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Lou Dobbs Tonight
New Worries Over E-Voting; New York Yankees Pitcher Killed in Plane Crash; Republicans Losing Ground?; Bush Administration Cannot Confirm That North Korea Carried Out Weapons Test; Peter Hoekstra Interview
Aired October 11, 2006 - 18:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
KITTY PILGRIM, CNN ANCHOR: Good evening, everybody.
At least two people were killed today when a small plane crashed into the apartment building in New York City. Now, reports say one of the victims was New York Yankees Pitcher Cory Lidle. He was 34.
The small plane involved was a four-seater, much like this one. Now, the crash immediately raised fears of a terrorist attack. But federal and local officials say there are no indications of any terrorist involvement.
Anderson Cooper reports from the scene right now -- Anderson.
ANDERSON COOPER, CNN ANCHOR: Kitty, the plane, we know, took off from New Jersey's Teterboro Airport.
According to New York's mayor, Michael Bloomberg, it circled the Statue of Liberty, then headed up the East River. That's about when they lost contact with it, just around the area of the 59th Street Bridge. At 2:48 p.m. today, a 911 call came in. An eyewitness saw the plane hitting the building. A large fireball erupted several stories up.
We're getting a number of eyewitness reports. Here's some of what people saw.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: I just saw -- I turned back. I was running with the dog. And I turned back. It was a huge fireball.
And, you know, I was just running in the street and screaming to everybody, "Call police, call police."
UNIDENTIFIED MALE: I work in that building, and they evacuated everybody out. And debris was still coming down when we came out of the building. I was so scared, let me tell you. I was so scared, because I thought it was another terrorist attack.
UNIDENTIFIED FEMALE: I was on the -- I was walking down toward 72nd Street on the corner. I heard the loud crash. And then I turned the corner. There were flames coming out of the side of the building. And, all of a sudden, about a minute later, debris from the side of the building fell down to the street. And then it was a cloud of black smoke, and you couldn't see anything else.
(END VIDEO CLIP)
COOPER: As many as 11 firefighters were injured in -- in fighting this fire. Five civilians were injured as well -- two fatalities that we know about. Michael Bloomberg, the mayor of New York, has confirmed two fatalities, both people aboard that aircraft.
The aircraft, CNN has confirmed, belonged to, was registered to New York Yankee pitcher Cory Lidle. The two bodies were found in the streets. And, according to sources with knowledge of the investigation, Kelli Arena is reporting that Cory Lidle's passport was also found in the street.
Michael Bloomberg gave a press conference just a short time ago. Here's some of what he talked about.
(BEGIN VIDEO CLIP)
MICHAEL BLOOMBERG (R), MAYOR OF NEW YORK: Two people that I talked to were in one of the apartments when at least eight pieces of metal -- I don't know how much -- came through their window. They ran out of the apartment. And we evacuated the building. And now the building is being reoccupied.
(END VIDEO CLIP)
COOPER: Emergency officials are on the scene. At one point, there were more than 150 firefighters on the scene. The investigation is still continuing.
You can actually see the apartment now from where I'm standing. It's just two blocks south of where I am. I'm on 74th. The apartment is on 72nd.
We have been seeing firefighters inside and investigators inside that apartment for the last hour, hour-and-a-half, taking photographs, examining the crime scene. At this point, we don't know what happened to the aircraft, what caused it to slam into that building.
It is not facing the river, where planes are allowed to fly. So, it certainly is off the normal flight pattern. One eyewitness I talked to who was on a bridge described the plane as flying erratically. He described it as flying in a zigzag pattern, before slamming into the building.
So, at this point, the investigation is well under way. And we're still waiting for more details of exactly what caused the crash, and to get final confirmation of the identities of those on board -- Peggy -- Kitty.
PILGRIM: Anderson, we understand that people are being allowed back into the building?
COOPER: That's right. Some people not fully back into the building, but those people below the impact zone, which is about at the 40th floor, are being allowed to reoccupy it. Obviously, the entire building was evacuated.
We actually talked to one construction worker who was working about 10 stories above the impact zone. He says he actually saw the plane as it was approaching the building, obviously, the loud explosion. They ran into the elevator. He and several other of the -- the workers in the building took the elevator, stopping at several floors, trying to find out if there was anyone else on those floors.
And, then, once they started to see smoke, they took the elevator all the way down to the -- to the -- to the ground floor. There was a certain amount of debris also in the streets -- but, as far as we know, no fatalities from that falling debris.
PILGRIM: All right, thanks very much, Anderson Cooper.
And following this crash, the North American Aerospace Defense Command -- it's known as NORAD -- scrambled fighter aircraft over numerous American cities. Now, NORAD said they put some aircraft up and readied others as a precaution, even know they believed the incident was not terrorism.
Now, NORAD sources would not what cities were involved. A Massachusetts National Guard spokesman, however, says fighters took off from Otis Air Force Base on Cape Cod.
We will be following this story throughout the broadcast. We will bring you any developments as they happen. And we will also have a live update from the scene.
Turning now to the war in Iraq, insurgents have killed six more of our troops. Three Marines were called in Al-Anbar Province. That's west of Baghdad. Three soldiers were killed in the Iraqi capital; 2,752 of our troops have been killed in Iraq; 20,895 troops have been wounded. And, of those troops, 9,432 were seriously wounded.
The army chief of staff today said the United States may keep 140,000 troops in Iraq for at least four more years. General Peter Schoomaker's assessment reflects the bleak security situation in Iraq. And a new private report says more than 600,000 Iraqis may have died as a result of the war.
Jamie McIntyre reports from the Pentagon.
(BEGIN VIDEOTAPE)
JAMIE MCINTYRE, CNN SENIOR PENTAGON CORRESPONDENT (voice-over): No one precisely how many Iraqis have died since the U.S. invasion in 2003, but data collected by a team of Iraqi doctors and analyzed by experts at Johns Hopkins University puts the number at a staggering 655,000. That's a big surprise to the top U.S. commander.
GENERAL GEORGE CASEY, COMMANDER, MULTINATIONAL FORCE IN IRAQ: The 650,000 number seems way, way beyond any number that I have seen. I have not seen a number higher than 50,000. And, so, I don't give that much credibility at all.
MCINTYRE: The study, published in the British medical journal "Lancet," is based on a survey of more than 12,000 Iraqis at 47 sites across the country. It found the death rate, which was 5.5 per 1,000 Iraqis before the war, has jumped to 13.3 per 1,000 now.
And, based on that, it projects between 400,000 and 900,000 have died, above what would have been expected, with the most probable total being 655,000.
Critics question if the survey is skewed because the number is so much higher than previous estimates that relied on actual body counts.
MICHAEL O'HANLON, SENIOR FELLOW IN FOREIGN POLICY STUDIES, BROOKINGS INSTITUTION: Their numbers are about one-tenth the kind of numbers you have gotten in this study. So, even if we were missing a lot of individual bodies, I don't think the numbers are going to grow by a factor of 10. I think the survey methodology is very suspect.
MCINTYRE: The report comes as Army Chief of Staff General Peter Schoomaker confirmed he's drawing up troop rotation plans to maintain the current number of troops in Iraq, roughly 150,000, for at least the next four years, even though Defense Secretary Donald Rumsfeld argues no one knows how many troops will be needed for how long.
DONALD RUMSFELD, SECRETARY OF DEFENSE: General Schoomaker and the Army does not set force levels in Iraq. They're not the ones who determine how many will be there and until what year they will be there.
(END VIDEOTAPE)
MCINTYRE: That's done by General George Casey, the top U.S. commander in Iraq, who, today, insisted again today he does not need more U.S. troops, even as he admitted that the level of violence is -- quote -- "as high as it's ever been" -- Kitty.
PILGRIM: All right, thanks very much, Jamie McIntyre.
We have new developments tonight in the North Korea nuclear crisis. Communist North Korea today threatened to conduct more nuclear tests. The North Korean regime also declared that new sanctions against North Korea would be a -- quote -- "act of war." The regime said it would physically retaliate for any new sanctions. It did not give details.
Now, President Bush today strongly defended his policies on communist North Korea and Iraq -- the president making a new attempt to convince voters he's on the right track, ahead of the midterm elections.
Ed Henry reports from the White House.
(BEGIN VIDEOTAPE)
ED HENRY, CNN WHITE HOUSE CORRESPONDENT (voice-over): Just four weeks before the midterm elections, the president became the prognosticator in chief.
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: I think the elections will be decided by security and the economy. This Foley issue bothered a lot of people, including me. But, I think, when they get in that booth, they're going to be thinking about, you know, how best to secure the country from attack, and, you know, how best to keep the economy growing.
HENRY: With Republicans struggling to regain their footing after the Mark Foley page scandal, the president tried to reframe the election as a referendum on the war on terror, claiming yet again Iraq is the central front.
BUSH: The stakes are high. As a matter of fact, they couldn't be higher. If we were to abandon that country before the Iraqis can defend their young democracy, the terrorists would take control of Iraq and establish a new safe haven from which to launch new attacks on America.
HENRY: But, with violence escalating, and Republicans, like Senator John Warner, charging Iraq is drifting sideways, the president's once mighty edge on national security has dissipated. While acknowledging tough times in Iraq, he implored his party to get tough with Democrats.
BUSH: When you pull out before the job is done, that's cut and run, as far as I'm concerned. And that's cut and run as far as most Americans are concerned. And, so, yes, I'm going to continue to reminding them of their words and their votes.
HENRY: In the wake of North Korea's recent nuclear tests, the president faced a barrage of queries about his vow three years ago to not allow them to obtain a nuclear weapon.
Mr. Bush dodged a question about where the red line with North Korea is now, and tried to shift the blame to the Clinton administration.
BUSH: I appreciate the efforts of previous administrations. It just didn't work.
HENRY: But former Clinton officials note, on their watch, North Korea never produced plutonium.
WENDY SHERMAN, FORMER STATE DEPARTMENT ADVISER: During the Bush administration, there has been a 400 percent increase in the amount of plutonium produced. We have gone from one to two nuclear weapons to four, six, eight, or 10.
(END VIDEOTAPE)
HENRY: Now, in a sign of his frustration, the president mused that, on Iraq, his critics said he went it alone. Now he's trying diplomacy, and people are saying he should go it alone this time and act militarily. Instead, the president insisted he's going to stick with diplomacy through the so-called six-party talks, and push for tough sanctions before the United Nations -- Kitty.
PILGRIM: Thanks very much, Ed Henry.
Well, a new CNN opinion poll shows that Republicans are facing an increasingly tough fight in the upcoming elections. The polls says Democrats are gaining ground on national security and some other issues.
Bill Schneider reports.
(BEGIN VIDEOTAPE)
WILLIAM SCHNEIDER, CNN SENIOR POLITICAL ANALYST (voice-over): If this midterm election is about Iraq, Republicans are in trouble.
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: These are tough times in Iraq.
SCHNEIDER: Increasing casualties have eroded public support for the war. In a recent CNN poll by Opinion Research Corporation, Americans now oppose the war in Iraq by nearly 2-1, the lowest level of support ever.
President Bush tried to frame the election around other issues.
BUSH: I think the elections will be decided by security and the economy.
SCHNEIDER: Republicans won the last two elections on security. It may not work this time.
Republicans have lost their lead on the terrorism issue for the first time since 9/11. Most Americans believe the Iraq war has made the United States less safe from terrorism. The poll was taken before North Korea announced it had conducted a nuclear test.
What about the economy?
BUSH: I understand that the economy is always a salient issue in campaigns. We have had some experience with that in my family.
SCHNEIDER: With gas prices down and the stock market up, you would think the economy would help the president's party. But, while the economy has been growing, most workers' wages have not. And homeowners are worried about a slump in housing prices, often their biggest investment.
The public gives Democrats a nearly 20-point lead on handling the economy. It's not a Republican issue. Republicans were probably relieved that it took nearly an hour for the Mark Foley scandal to come up at President Bush's news conference.
BUSH: We want to make sure what we understand what Republicans knew and what Democrats knew.
SCHNEIDER: That issue appears to have taken a toll on Republicans. When asked which party would do a better job on moral issues like same-sex marriage and stem cell research, Democrats now have a strong lead.
(END VIDEOTAPE)
SCHNEIDER: President Bush does not want this midterm to be the Iraq election or the Foley election. But it's not clear the president can control the agenda -- Kitty.
PILGRIM: Thanks very much, Bill Schneider.
Well, later in the broadcast, three of the country's finest political analysts will join me.
Plus: new concerns about threat to our democracy from e-voting.
Also, the U.S. government is making it easier for illegal aliens to send money to their home countries.
And, also, we will go back to the Upper East Side of Manhattan for the latest on the New York City plane crash.
Stay with us.
(COMMERCIAL BREAK)
PILGRIM: President Bush said once again today that he is committed to building both a real and virtual fence on the U.S. southern border with Mexico. The president challenged critics who said he is not truly committed to building this fence, but he also said a border fence is not the real answer to this nation's illegal immigration crisis.
(BEGIN VIDEO CLIP)
BUSH: You can't fence the entire border, but what you can do is, you can use a combination of fencing and technology to make it easier for the Border Patrol to enforce our border. I happen to believe, however, that, in order to make sure the border is fully secure, we need a guest worker program, so people aren't sneaking in, in the first place.
(END VIDEO CLIP)
PILGRIM: Now, as President Bush vows to continue his push for so-called comprehensive immigration reform, the U.S. government is making it even easier for illegal aliens to send money home to their families. And critics say this new policy will only entice more illegal aliens to enter the United States.
Casey Wian reports.
(BEGIN VIDEOTAPE) CASEY WIAN, CNN CORRESPONDENT (voice-over): Apparently oblivious to the promised federal crackdown on illegal immigration, the U.S. Federal Reserve is expanding a program that helps Mexican illegal aliens send money home. It's called Directo a Mexico.
The Fed's marketing material says it's the most convenient way to transfer your money to Mexico. The Fed says your family receives more pesos for every dollar you send, because Directo a Mexico offers the best exchange rate. And it reassures illegal alien customers they won't lose their money, even if they're deported.
Texas Congressman Jeb Hensarling is on the committee overseeing the Federal Reserve.
REP. JEB HENSARLING (R), TEXAS: Well, of course it's a mixed message. I mean, we have got a branch of the federal government arguably giving tacit approval to people who come here illegally.
WIAN: One hundred and fifty U.S. financial institutions have signed up for Directo a Mexico. The only I.D. required of customers is Mexico's matricula consular, widely used by illegal aliens.
DR. STEVEN CAMAROTA, CENTER FOR IMMIGRATION STUDIES: To control illegal immigration, it takes a lot of things. It takes the border. It takes going after employers. And you don't want to do stupid things, like making it easier for illegals to transfer money back and forth. So, you require proper identification whenever someone wants to transfer money out of the country. It's very simple. We could do it.
WIAN: The Fed says most of the funds being transferred now are Social Security payments to retirees in Mexico, but it hopes to attract more individual workers, now using Western Union and similar services.
The Atlanta Federal Reserve Bank, which runs the Directo a Mexico program, says immigration laws are not its area of focus. The Mexican Central Bank this month announced, remittances from the United States have jumped nearly 20 percent so far this year, and are on pace to total $24 billion, smashing last year's record. Remittances are now neck-and-neck with oil as Mexico's second largest source of foreign revenue, behind only illegal drugs.
(END VIDEOTAPE)
WIAN: But some prominent Mexicans are now beginning to question that economic model. In just the past week, Mexico's Central Bank governor and its leading industrialist both criticized the country's increased reliance on money from Mexicans working abroad -- Kitty.
PILGRIM: Thanks very much, Casey Wian.
Well, sentencing for -- two new developments in the case for the U.S. Border Patrol agents. Now, they are convicted of shooting a Mexican drug smuggler. And sentencing for the agents will take place next Thursday. A federal judge in Texas turned down their request to delay the sentencing.
Now, lawyers for Ignacio Ramos and Jose Compean were attempting to delay sentencing until after a congressional hearing into their case later this year. The agents were convicted of shooting the smuggler, the drug smuggler, while trying to protect our southern border. The drug smuggler testified against the agents, with full immunity from prosecution. And he remains a free man tonight.
Well, tonight, the Bush administration says it will accept charitable donations of heating oil from Venezuela. Energy Secretary Samuel Bodman says he sees no problem with taking charity from the government of Hugo Chavez and its state-controlled oil firm, Citgo.
Now, this is the same Hugo Chavez who called President Bush a devil during a speech during the United Nations. Bodman says -- quote -- "I can't find my way clear to object to Venezuela being charitable. I view it as a charitable contribution, and I wish more companies did it."
Well, states across this nation, including Alaska, have already announced that they will refuse energy help from Venezuela, after the Chavez speech.
Still ahead: There's brand new concern tonight over the condition of this nation's voting machines, with less than four weeks before Election Day. We will have a special report.
Plus, credit card companies are being accused of putting profits before principles, and targeting this nation's cash-strapped middle- class.
Also, we will have the very latest on today's deadly plane crash in New York City. It may have killed a member of the New York Yankees. We will be live on the scene.
Stay with us.
(COMMERCIAL BREAK)
PILGRIM: New worries tonight about e-voting. States are buying used voting machines. And activists are concerned that these machines are not properly certified. And, once again, the machines undergo upgrades. They may no longer meet state standards.
(BEGIN VIDEOTAPE)
PILGRIM (voice-over): The worries over electronic voting are compounded by the fact that several states are having to install used machines that were refurbished for this election.
Election officials in Tennessee are struggling to get the electronic voting equipment they need. The chairman of Davidson County Election Commission says they ordered 619 machines from ES&S, but later needed 100 more.
He says ES&S could not provide 100 new machines right away. But the company said they could send refurbished used machines from Pennsylvania for the early voting in coming weeks.
EDDIE BRYAN, CHAIRMAN, DAVIDSON COUNTY, TENNESSEE, ELECTION COMMISSION: In the first, we were going to get all refurbished machines. And we complained so much that they ended up sending us the 619 which are new machines, and the other 100 are from Pennsylvania.
PILGRIM: ES&S says the machines are fine: "We provided 619 new iVotronics, in keeping with our contractual agreement with Davidson County. In addition, we provided the county with another 100 touch- screen machines, all of which have been thoroughly tested and meet rigorous standards for accuracy."
But Tennessee isn't the only state using hand-me-downs. Overhauled e-voting machines were also used in recent Pennsylvania election in Bucks County and Allegheny County and several others.
COLLIN LYNCH, CARNEGIE MELLON UNIVERSITY: We, as voters, really don't know what's going on inside those machines at any time, whether they came direct from the factory or from some other state. We don't know. And the companies are not really permitting anyone to check.
(END VIDEOTAPE)
PILGRIM: Now, the chain of custody for these machines is the real issue. Experts say the machines can be tampered with, and malicious codes inserted, as these machines pass from one jurisdiction to another.
Well, time now for some of your thoughts.
V. in Florida: "I think the greatest danger to the citizens of the USA is the war on the middle class. We are suffering already from that one."
Jim in Colorado writes: "Based on your story, the tourism industry is out to destroy our country by overwhelming our limited resources with illegal aliens. Fool me once, shame on you. Fool me 11 million times, shame on me."
And Mike in Texas writes: "What we all know now, that the U.N. will not do anything to North Korea, because China, France, and Russia will not support it. Get the U.S. out of the U.N., and get the U.N. out of the U.S."
Do e-mail us at LouDobbs.com. We will have more of your thoughts a little bit later in the broadcast.
And each of you whose e-mail is read here will receive a copy of Lou's new book, "War on the Middle Class."
And, for more of Lou's thoughts on the war on the middle class, you can read his commentary on our Web site, LouDobbs.com.
Coming up: Congressman Peter Hoekstra is calling for an emergency summit meeting on Capitol Hill to discuss the widening North Korean nuclear threat. He will be my guest. Also, a new report is blasting credit card firms for waging nothing less than an all-out war on the middle class. We will have the story.
And the latest on today's plane crash into a New York City high- rise -- CNN now confirming it killed a star Yankees pitcher.
Stay with us.
(COMMERCIAL BREAK)
PILGRIM: In the last few minutes, New York Yankees owner George Steinbrenner has confirmed that pitcher Cory Lidle was killed in today's plane crash in New York City. One other person was killed.
Allan Chernoff has the very latest from Manhattan's Upper East Side -- Allan.
ALLAN CHERNOFF, CNN SENIOR CORRESPONDENT: That's right, Kitty.
George Steinbrenner, the principal owner of the Yankees, has just released a statement, saying, "This is a terrible and shocking tragedy that has stunned the entire Yankees organization."
Apparently, the plane that did crash into the building here on New York's Upper East Side was owned by Cory Lidle, the New York Yankee pitcher, and he apparently was in that plane.
We understand that he was in there with an instructor. But, reportedly, he had 75 hours of flight time under his belt, and was working on more flying when this tragedy did occur.
It all happened at about 2:45 this afternoon. Witnesses say they heard the plane flying very low and some say that it zigzagged a little, curved a little and then slammed right into the building. People who did not actually see it said they thought it was a car crash or a truck crashing perhaps, slammed into the building. Of course, burst into flames. Firefighters were on the scene very quickly. Put the fire out in pretty good amount of time. About 40 minutes or so. And we did speak with one witness a little bit after the crash occurred.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: Everybody started running. When I looked up I seen a small plane crash into the building. It was like he was having a malfunction. It was like he was trying to swerve away from the building, like land in the water, but he was already too close to it. And then he turned down and just hit the building and everybody started running up the block.
(END VIDEO CLIP)
CHERNOFF: We understand there were two fatalities, Cory Lidle and the other person in the plane. Eleven firefighters with minor injuries brought to area hospitals. But incredibly, it seems no one was seriously injured on the ground and also in the actual building itself, at least those are the initial reports we have from area hospitals -- Kitty.
PILGRIM: Thanks very much. Alan Chernoff.
Turning to the North Korea nuclear crisis, the Bush administration still cannot confirm that North Korea actually carried out a weapons test. U.S. intelligence officials continue to analyze data about the test. Barbara Starr reports from the Pentagon.
(BEGIN VIDEOTAPE)
BARBARA STARR, CNN PENTAGON CORRESPONDENT (voice-over): Three days after North Korea said it detonated its first nuclear device underground, the U.S. intelligence community doesn't know if it's true.
DONALD RUMSFELD, DEFENSE SECRETARY: It's unlikely we will know everything because it is a closed society, and it is absent certain kinds of intelligence, it's impossible to know of certain knowledge, certain things that take place in a closed society.
STARR: A U.S. official with access to classified information tells CNN, "The bottom line is, we cannot confirm at this point it was a nuclear test."
The working assumption is it was a nuke. But with billions of dollars in spy plane satellites and sensors on the hunt, why doesn't the U.S. know for sure? Did Kim Jong-Il fool the United States?
JOHN PIKE, GLOBALSECURITY.ORG: I think that one crucial piece of evidence that they're looking for sounds like it simply isn't there. The smoking gun that they would have been looking for would be radioactivity.
STARR: The underground test may have been so deep that radiological sensors will not pick up any positive readings. Intelligence analysts also tell CNN that the North Koreans may have deliberately buried the bomb in a way that would muffle the seismic shock wave, making it hard to verify if it's nuclear and how big the blast really was.
Pyongyang wanted to keep spy planes and satellites from seeing what was going on. Preparations were made at several sites. A senior U.S. military commander confirmed to CNN that the only knowledge the test was about to happen came from China.
The intelligence community is now analyzing pictures of the site to see if there is a crater. The tenet of assessment, the North Koreans had a small test that simply didn't work too well.
(END VIDEOTAPE)
STARR: Kitty, everyone is now waiting to see if North Korea does conduct a second larger test to try and convince the world that it does have nuclear weapons. The only question may be whether the U.S. intelligence community can figure out what happened on that first test before a second test occurs -- Kitty.
PILGRIM: That would be good. Thanks very much, Barbara Starr.
Well, the federal budget deficit fell to its lowest level in four years. The budget got close to $247 billion and President Bush cited the results as proof that his pro-growth policies are working. The president also said we reached the goal three years ahead of schedule.
And tonight, this nation's major credit card firms are being accused of waging an all-out war on the middle class. A government report says these firms are attempting to boost profits on the backs of cash-strapped middle class Americans. Congress says these credit card companies must be stopped. Bill Tucker reports.
(BEGIN VIDEOTAPE)
BILL TUCKER, CNN CORRESPONDENT (voice-over): Americans owe more than $1.8 trillion to credit card companies. Consumers hold more than 691 million credit cards and use them to pay for everything from grocery to postage, clothes, gasoline, even taxes.
ROBERT MANNING, AUTHOR, CREDIT CARD NATION: The average American family who has unexpectedly high medical expenses or loses their jobs or has a family crisis or huge school expenses, it's going to end up on their credit cards. The banks know it. It's why it's the most profitable product that they sell and the most complex to understand.
TUCKER: A fact that the report from the Government Accountability Office makes clear. Among other findings of the year- long study, the average penalty for making a late payment in 2005 was $34. That's up 115 percent from ten years ago.
One third of consumers were charged interest on debt they had already paid. Consumers charge penalty rates sometimes as high as 30 percent when they paid late or exceeded their credit limit. Consumers not told that they are charged for making a single bill payment by telephone. Fee disclosures that are difficult to understand.
SEN. CARL LEVIN (D), MICHIGAN: They are small amounts or they seem like small amounts when you talk about them. Five dollars, $10, $15. But these are hard for middle income people to pay and they add up to huge amounts of profit which are unconscionable based on the way in which this money is extracted from people. Without disclosure that is adequate.
TUCKER: For example, there is the universal default provision allowing banks to unilaterally raise your interest rate.
(END VIDEOTAPE)
TUCKER: Now Congress does not have regulatory authority over interest rates but it does have authority over fees. And Kitty, Senator Levin says that if the credit card companies have a grace period, here, this report released today, they can take action themselves or he says he is willing to prompt Congress to take action against them. PILGRIM: We'll see how it plays out. Thanks very much, Bill Tucker.
And that does bring us to the subject of tonight's poll. Do you believe the federal government is doing all it can to protect Americans from the predatory practices of credit card companies? Yes or no. Cast your vote at LouDobbs.com. We'll bring you the results a little bit later in the broadcast.
And do join us next Wednesday, October 18th, for a LOU DOBBS TONIGHT special report, war on the middle class. Lou will be reporting live from Kansas City, Missouri and that's next Wednesday, 7:00 p.m. Eastern here on CNN. Coming up we'll hear from the chairman of the House Committee on Intelligence and the U.S. response to North Korea's nuclear weapons test.
Also a panel of the nation's leading political analysts will be here with their insight on North Korea, the increasing heat from the Foley scandal and more and the impact on the midterm elections. Stay with us for that.
(COMMERCIAL BREAK)
PILGRIM: A prominent House Republican tonight is calling for an end to the partisan squabbling over North Korea's nuclear menace.
Congressman Pete Hoekstra chairs the House Select Committee on Intelligence and he sent a letter to President Bush requesting a bipartisan summit on North Korea so this country can project a united front against nuclear proliferation and Congressman Hoekstra joins us live from Grand Rapids, Michigan.
Thanks for being with us, sir.
REP. PETER HOEKSTRA (R), MICHIGAN: Hi, Kitty.
PILGRIM: Hi. Let's just read a little bit from your letter so that our viewers know how you feel.
And it reads, "The threats we face from North Korea's provocative acts are too great to be used as fodder for the upcoming elections. America must be united against North Korea's belligerence and on our call for an end to nuclear weapons proliferation around the world."
You've called this political gamesmanship. Do you think that this will be heated or, going into an election season, this is just one more voice in the wilderness?
HOEKSTRA: Well, I hope it's not one more voice in the wilderness. I hope that it is heated. I think it's absolutely necessary.
We need to demonstrate to the American people that, right now, on an issue like North Korea, that public policy is more important than partisan politics. You know, over the last couple of days, Democrats have been blaming Republicans; Republicans have been blaming Democrats about how we got here.
The focus needs to be on North Korea. This is a rogue regime. They lie; they cheat; and they distort. This is not a problem within the United States. This is a problem with the kind of government that we are dealing with today.
PILGRIM: You know, I'd like to quote from Senator McCain, because he's made comments that blame the Democrats for the failed policy. But it also reflects on North Korea, considerably.
And he said, "Every time the Clinton administration warned the Koreans not to do something, not to kick out the IAEA inspectors, not to remove fuel rods from their reactor, they did it. And they were rewarded every time, by the Clinton administration, with further talks."
In a way, though, North Korea's reaction to either approach has been the same. They do what they please.
HOEKSTRA: That's exactly right. The focus is on North Korea.
I think Senator McCain responded and responded so forcefully -- I believe he did that last night -- was because, the day before, Senator Clinton had gone after the Bush administration and blamed the Bush administration. I applaud Senator McCain for defending the president.
But we need to move beyond that now, get the bipartisan leadership in Washington together to talk about this issue, understand what we know and do not know about North Korea, provide input to the president as to where we think we ought to be going, and then move forward in a united way.
The president has done this very, very effectively before where he's gotten us together, gotten our input so that he can move forward confidently.
PILGRIM: Let's turn to -- the U.N. Secretary General Kofi Annan called for the U.S. to hold one-on-one talks with North Korea. And President Bush had this to say. Let's listen from his press conference earlier today:
(BEGIN VIDEO CLIP)
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: Saying as loud as I can and as clear as I can that there is a better way forward for North Korea and that we will work within the context of the six- party talks.
People say you don't talk to North Korea. Look, we had a representative, a United States representative at the table in the six-party talks. The North Korean leader knows our position.
(END VIDEO CLIP) PILGRIM: Now this was a fairly heated exchange at today's press conference, a bit of frustration you can hear in the president's voice.
What's your reaction to that remark?
HOEKSTRA: Well, I agree with the president. I mean, one of the things that we found after the North Koreans violated the 1994 framework, we found and got new insights into who they are and how they work.
We're going to need verification on any new agreement. Verification can really only come through China. They're the only one that can reach down into North Korea to make sure that North Korea is adhering to any agreements that are made.
Plus, Taiwan, South Korea and Japan have to be a party of this. They need to reinforce the message to China that says: If you don't rein in North Korea, excuse us, we may need to go down the nuclear path.
This has to be a regional solution. It cannot be a bilateral solution between the United States and North Korea, because it just will not work. There are too many other countries in that part of the world who have a vested interest in what happens. And they deserve and need a seat at the table.
PILGRIM: And we've also had North Korea reacting to even the hint of pressure, saying that U.S. pressure would be seen as an act of war, a declaration of war. So they're already rationing up the rhetoric even without a conclusion to the discussions on sanctions.
HOEKSTRA: Well, there's another insight into exactly the kind of country that we are dealing with. They break the '94 agreement, they cheat and they lie, they set off their potentially nuclear weapon, they fire their ballistic missiles on July 4, and now they're talking about going to war.
That's why this points out this needs to be a regional solution. And the most important thing is that America needs to stand united. Because not only is North Korea watching, the Chinese are watching, radical Islamists are watching and Iran is watching, because they all believe that they can maybe push us around and that we are divided.
We need to show strength and unity.
PILGRIM: Well, thank you very much for coming on this broadcast to explain that to us and the American public. Representative Peter Hoekstra, thank you, sir.
HOEKSTRA: Thank you.
PILGRIM: A reminder now to vote in tonight's poll. Do you believe the federal government is doing all that it can to protect Americans from predatory practices of credit card companies? Yes or no. Cast your vote at LouDobbs.com and we'll bring you the results in just a few minutes.
And just ahead, things are getting ugly as Republicans try to hold on in the midterm elections. Congressman Christopher Shays locked in a tight race cut loose with some scathing rhetoric and our panel of political experts will be on next with the very latest polling. Stay with us.
(COMMERCIAL BREAK)
PILGRIM: Coming up shortly here on CNN is THE SITUATION ROOM with Wolf Blitzer -- Wolf.
WOLF BLITZER, CNN ANCHOR: Thanks very much, Kitty. We're going to have the latest on the breaking news in New York City. The plane crash -- the plane that crashed into a Manhattan high-rise killed Yankee pitcher Cory Lidle. We're live at the scene with the latest.
Also we'll have more on the plane Lidle was flying. CNN's Miles O'Brien, himself a licensed pilot, owns a very similar plane. He's going to be joining us. And echoes of 9/11, we'll hear from New Yorkers about the terror fears that went through their minds in the chaos and the confusion after the crash. All that, Kitty, coming up right here in THE SITUATION ROOM.
PILGRIM: Thanks so much, Wolf.
Well, congressional ethics, the war in Iraq, nuclear threat from North Korea, all of these issues are likely to weigh on voters' minds in the midterm elections next month. And for some analysis, we turn to three of the best political minds in the country.
Former White House political director, Republican strategist Ed Rollins, Michael Goodwin of the "New York Daily News" and Democratic strategist Robert Zimmerman. Thanks for being with us.
We really should start with North Korea. North Korea has now threatened the United States saying we've declared war basically and they will respond with physical measures. It seems even after they test, they still ratchet up the pressure. What do you make of this?
ROBERT ZIMMERMAN, DEMOCRATIC STRATEGIST: What it really reflects is a collapse of the Bush administration's credibility in foreign policy. Now, granted, North Korea's been difficult for every presidency back to Ronald Reagan.
But the reality here is that we do need the six party talks because ultimately China does have an extraordinary leverage over North Korea. And hopefully this administration -- it's not a partisan -- this issue really is above partisan politics. Because hopefully this administration will be able to find a way to restore its credibility and be able to bring China to the table and either through the appropriate sticks and the appropriate penalties, make it clear that North Korea has an enormous price to pay if they don't cooperate with the six party discussions.
PILGRIM: Isn't it really up to China, their so-called ally in this? Correct?
MICHAEL GOODWIN, "NEW YORK DAILY NEWS": Right. Supposedly. But I think it does point out not so much the failure of the Bush administration, as Robert said, but the difficulty of the world we live in now. What do you do with a rogue nation like North Korea that has nuclear weapons, probably.
We can either attack them or we can keep talking to them. But the talking doesn't seem to be working. It is right to involve the other regional powers, particularly China and South Korea, Japan, Russia. They all are closer geographically. They all clearly have a stake in it.
So it's important that we work with our allies. If that doesn't work, then I think we're back where we start, which is what do we do on our own?
PILGRIM: And I'll get to you in a second. I want to go to Condoleezza Rice's comment about the six party talks as long as we're on that topic.
(BEGIN VIDEO CLIP)
CONDOLEEZZA RICE, SECRETARY OF STATE: If he wants a bilateral deal, it's because he doesn't want to face the pressure of other states that have leverage. It's not because he wants a bilateral deal with the United States. He doesn't want to face the leverage of China or South Korea or others.
(END VIDEO CLIP)
PILGRIM: Now, North Korea walked out of these talks. How do we even get them to ...
ED ROLLINS, REPUBLICAN STRATEGIST: First of all, let's be realistic about this. First of all, the problems with North Korea go back to Truman. Every president has had problems with them. And this is not a government, this is a nut case dictator, who is the son of another nut case dictator who lives in a totally isolated world.
The only thing that he would care that would be boycotted would be his Hennessy cognac that he drinks $600,000 a year worth of.
He has a starving people. He doesn't care what happens to his people. He lives in this incredible life in which it doesn't matter what the world thinks of him and never has. So I'm very pleased that our allies are basically willing to do some things with us. But I don't know other than invade anything that we can do to change them.
We've tried to put all sorts of pressure on them. But he has been willing over the past to let his people starve and die. And so I think from our perspective, sanctions and everything else are something that's not going to affect him.
ZIMMERMAN: But we do know China has a great deal of leverage over the issues of energy, in particular, oil with North Korea. And that's one option that has to be explored. And likewise as well, secretary of state Colin Powell gave Bill Clinton credit for freezing plutonium. And in fact that resulted in the fact that during the Clinton administration, nuclear weapon was not produced. They quadrupled their plutonium stockpile during this administration.
It's not -- this is really not about partisanship. It's about the fact that this administration has got to be able to restore its credibility in the world stage to bring leverage to bear.
ROLLINS: I'm not making it about partisanship. We're asking China to do a lot and I hope China will do a lot and I hope Japan will do a lot but I'm just not has optimistic. And it can't be about bipartisanship. It really has to be about strength and leadership.
But I don't think we're dealing with a rational man. I think his goal is to sit down, just as his goal is to have nuclear weapons so he can say he is one of the world powers, I think his goal also is to sit down with President Bush one on one so he can walk off and tell us all ...
(CROSSTALK)
PILGRIM: OK. We're going to move to another topic. Not for any other reason other than we have to cover another topic.
Republican Congressman Chris Shays commented on the Democrats demand that speaker Hastert resign. And I want to read this quote in the "Hartford Current."
"I know the speaker didn't go over a bridge and leave a young person in the water and then have a press conference the next day."
Pretty harsh statement, the congressman clearly making a reference to Senator Edward Kennedy's incident at Chappaquiddick.
ROLLINS: This is very unlike Congressman Shays and it was a tragic accident that occurred a long time ago and a lot of Republicans have had fun with it over the years. But I think it's way beyond the pale and I'm sorry the congressman said that.
GOODWIN: I think it probably wasn't necessary although I'm one of those who thinks any time Ted Kennedy starts talking about morality, it is fair to bring it up. But I do think that probably the Foley incident is not going to be a huge issue in the polls. I think that those who might be most offended by it, let's say those who might be the values voters are not going to vote for Democrats as a result. They might stay home in certain districts.
But I think that Foley is not going to drive a lot of people in the Democrat camp. President Bush said today the election is going to be about the economy and the war on terror, especially Iraq. I think there's a little bit of hope he thinks those are his strengths. I'm not so sure they are but I think he's basically right. That would be the fundamental issue in the voting booth.
ZIMMERMAN: It is out of character for congressman shays to speak that way. But his flip-flopping on Iraq reflects also the desperation of his candidacy. He's sounding and acting very much like a typical losing politicians.
But the Foley issue, and I would differ with Mike on this. Foley is not the issue, the issue with the number of congressional leaders who knew about this predatory signals that Foley was sending out and about these "overly friendly" e-mails he was sending out, the fact that he informed the speaker and went back, like Congressman Reynolds, and encouraged Foley to run again. It's about the accountability of the Republican leadership in the House. That's what the story is and those kinds of issues is going to be what determine it is midterm elections.
PILGRIM: Let me just -- we do have a poll conducted by Associated Press. And it is what voters are more interested in. And the poll shows that 70 percent talk about politics with friends and family. Forty three percent talk about politics at work. And 28 percent talk about politics at their place of worship.
Politics is a topic that's really out there. We're talking about the partisanship but is politics partisanship or is politics issues at this point?
GOODWIN: I think it depends on who these people are. In certain areas at places of worship, it's going to be one kind of discussion. They talk about it in the office, it could be nothing more than what was on the news or in the newspaper. But I think that people are interested. You're going to have a big drop-off and turnout in the midterm election as Ed has pointed out. So I think it really is going to be who does come out to vote in a midterm election.
ROLLINS: The American public is very frustrated. Politics in New York, last week was whether the Mets and the Yankees were going to play in the World Series. Obviously the Yankees are now out so there is other issues. But I think the critical thing here is that Americans are very frustrated by the political system. Since 2000, we've had very, very polarized electorate -- and we're going to have a very close election again. And people aren't going to be satisfied with the end result. I think that's part of the frustration. They don't think things are getting done.
PILGRIM: Bob, last word, quick.
ZIMMERMAN: Bottom line is I think that poll reflects the fact that this election is about issues and it's about accountability when you see Democrats in the CNN poll winning in every category from moral values to competence in the war on terrorism to competence in the economy, I think it reflects the fact that the country is coming together and the active voters are coming around the Democratic message.
PILGRIM: All right. Robert Zimmerman, Michael Goodwin, Ed Rollins, thank you very much.
And still ahead, the results of tonight's poll ahead. Stay with us. (COMMERCIAL BREAK)
PILGRIM: Now the results of tonight's poll. Ninety-eight percent of you say the federal government is not doing all it can to protect Americans from predatory practices of credit card companies. Let's look at some of your thoughts.
Bob in Wisconsin, "Knowing the abysmal track record of Congress and the Bush administration on matters such as Iraq, illegal immigration and job outsourcing, affordable healthcare and the energy crisis, how can we even imagine they will find a way to resolve our growing tension with North Korea?"
Do send us your thoughts at LouDobbs.com and thanks for being with us tonight. Please join us tomorrow. Good night from New York. THE SITUATION ROOM starts right now with Wolf Blitzer -- Wolf.
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