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LOU DOBBS TONIGHT

Iraq Crisis Talks; Al-Sadr Loyalists Boycott Iraqi Government; More U.S. Troops Going to Baghdad as Violence Worsens; U.S. Airlines On Sale to Foreign Investors; Bashar Ja'afari Interview

Aired November 29, 2006 - 18:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


LOU DOBBS, CNN ANCHOR: Tonight, President Bush and the Iraqi prime minister are preparing for talks in Jordan that could determine whether the United States succeeds or fails in Iraq. We'll have reports tonight from Amman, Baghdad and the Pentagon.
The president is also determined to push his quiet agenda to create a North American union of the United States, Mexico and Canada without the approval of the people or the Congress.

We'll have that special report and a great deal more straight ahead here tonight.

ANNOUNCER: This is LOU DOBBS TONIGHT, news, debate and opinion for Wednesday, November 29th.

Live in New York, Lou Dobbs.

DOBBS: Good evening, everybody.

President Bush and the Iraqi prime minister tomorrow will hold talks in Jordan that could determine whether Iraq slides into an all- out civil war. Their talks come amid increasing signs that the Iraqi prime minister has lost control of his country to radical Islamist insurgents and terrorists.

U.S. officials say the outcome of this war depends on whether the United States can win the battle for Baghdad. The U.S. military today announced it's sending at least three more battalions to Baghdad.

Ben Wedeman reports tonight from Amman, Jordan, on the high stakes in tomorrow's meeting between President Bush and the Iraqi prime minister.

Arwa Damon tonight reports from Baghdad on a new revolt that threatens the future of the entire Iraqi government.

And Jamie McIntyre reporting from the Pentagon tonight on the military's decision to send thousands more troops to Baghdad.

We turn first to Ben Wedeman with the president tonight in Jordan -- Ben.

BEN WEDEMAN, CNN INTERNATIONAL CORRESPONDENT: Yes, Lou, well, President Bush was supposed to meet with Iraqi Prime Minister Nuri al- Maliki, but the meeting was canceled. American and Jordanian officials say it was not a snub, just a question of scheduling.

Whether you believe that or not, it is not an auspicious start to a Mideast mission that was from the beginning a tall order.

(BEGIN VIDEOTAPE)

WEDEMAN (voice over): It would hardly seem like the best time to visit the region. President Bush's grand ambitions for the Middle East lie in disarray.

In Iraq, what was supposed to be a beacon of democracy has become a black hole of sectarian violence and anarchy. The administration still insists it's not civil war, though what Iraqi officials describe sounds almost as bad.

MOWAFFAK AL-RUBAIE, IRAQI NATIONAL SECURITY ADVISER: This is a war between the extremists and the moderates in the whole region. And that's why it's concentrating its effort in Iraq. If they lose, they lose in the whole region. If they win, god forbid, they will disrupt the whole region again.

WEDEMAN: Perhaps glimpsing post-pullout reality, Iraqi president Jalal Talabani is now rubbing shoulders with the leaders of Iran, who seem as determined as ever, threats of sanctions notwithstanding, to pursue a nuclear option, flushed with growing regional clout.

In Lebanon, the U.S.-backed government is under siege.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: And that government is being undermined, in my opinion, by -- by extremist forces encouraged out of Syria and Iran. Why? Because a democracy will be a major defeat for those who articulate extremist points of view.

WEDEMAN: Across the region, hopes for a blossoming of democracy have been dashed as almost every experiment in political liberalization in Egypt, in Iraq, in the Palestinian territories has empowered or emboldened Islamic hard-liners.

(END VIDEOTAPE)

WEDEMAN: Lou, there will be a meeting, of course, tomorrow morning between Maliki and President Bush. First they'll have breakfast, then they'll have a closed meeting, and then a press conference.

Interestingly enough, the Iraqi prime minister has announced that as soon as he gets back to Baghdad, he'll hold another press conference. It will be interesting to hear what he has to say -- Lou.

DOBBS: Ben, thank you very much.

Ben Wedeman.

As Ben just reported today, a clear demonstration of the Iraqi prime minister's political weakness and his opposition. Radical Islamist lawmakers in Baghdad today suspended their support for al- Maliki's government to protest his meeting with the president now scheduled for tomorrow. The Iraqi parliament has a total of 275 seats, including Shia, Sunnis and Kurds.

The most powerful bloc among the Shia is the United Iraqi Alliance. It's led by Prime Minister al-Maliki and has 128 of those seats. Thirty members of that bloc walked out today, all of them controlled by and supporters of the anti-American cleric, Muqtada al- Sadr.

Al-Sadr also controls six of the 32 government ministries, including health and transportation. They also walked out today.

Arwa Damon has our report from Baghdad -- Arwa.

ARWA DAMON, CNN CORRESPONDENT: Lou, Iraqi Prime Minister Nuri al-Maliki's ability to hold his government together is in question.

(BEGIN VIDEOTAPE)

DAMON (voice over): An army of followers. Radical Shia cleric Muqtada al-Sadr's speeches rally the masses. The anti-American political bloc threw its clout behind Nuri al-Maliki, giving him the prime ministership by a single vote, but Prime Minister Maliki's base is crumbling because he has not canceled plans to meet with President Bush in Jordan.

SAILH AL-UQAILI, SADR BLOC SPOKESMAN (through translator): The Sadr bloc in the house of representatives and the Sadr movement and ministers are suspending their membership of parliament and the government.

DAMON: The Sadr bloc holds at least 30 seats in parliament, controls six ministries. And if their demands, number one being a timetable for the withdrawal of U.S. troops, are not met, they threaten to fully withdraw from the government.

In the struggle to control power, this is al-Sadr's biggest political move, a reminder to Nuri al-Maliki and the United States of the power he wields, power that is bolstered by the Mehdi militia, thousands of well-armed fighters believed to be behind much of the sectarian violence here.

As the strength of the government is publicly being tested, not much is changing in the streets of Iraq. In Baghdad, at least three car bombs exploded in a single afternoon. Iraqi police found 52 bodies in 24 hours. And many Iraqis question why they ever went to the polls to vote for this.

(END VIDEOTAPE)

DAMON: Few Iraqis think he's the man for the prime minister's job. Now Nuri al-Maliki has to prove to the United States that he can pull it together, another ally whose confidence in him is shaky -- Lou.

DOBBS: Arwa Damon from Baghdad.

The U.S. military now sending as many as 20,000 more of our troops to the Iraqi capital. The reinforcements are the latest sign the Iraqi government is unable to secure its own capital without U.S. support.

Jamie McIntyre reports from the Pentagon -- Jamie.

JAMIE MCINTYRE, CNN SR. PENTAGON CORRESPONDENT: Well, Lou, as Iraqi forces have failed to step up, once again U.S. forces have to step in. U.S. commanders tired of waiting for Iraqi battalions to show up in Baghdad have instead decided to order additional U.S. troops into the Iraqi capital.

Pentagon sources say that three battalions of U.S. Army troops will be moving into the Iraqi capital. That is about 1,600 troops. Even with more than 300,000 Iraqi troops in uniform, the Pentagon says many are unwilling to leave their home areas and others are just unsuitable for work in Baghdad.

(BEGIN VIDEO CLIP)

GEN. PETER PACE, JOINT CHIEFS CHAIRMAN: There are some units around Iraq that if moved into Baghdad would not be helpful. If a Sunni unit somewhere else in Iraq moved into a Shia neighborhood, or a Shia unit someplace else in Iraq moved into a Sunni neighborhood, it's not going to help the problem.

(END VIDEO CLIP)

MCINTYRE: The chairman of the Joint Chiefs also dismissed a report from ABC News suggesting that he was considering turning over the insurgent stronghold of Al Anbar Province to Iraqi security forces and moving the Marines there to Baghdad. General Pace says he's been meeting with colonels and captains just back from Iraq, and while they're considering almost everything, he said abandoning Anbar Province is not on the table -- Lou.

DOBBS: Thank you very much.

Jamie McIntyre from the Pentagon.

Well, in Iraq, two more of our troops have been killed. One soldier killed in Al Anbar Province, another killed north of Baghdad.

Sixty-four of our troops have been killed so far this month, 2,884 of our troops have been killed since the war began; 21,921 of our troops wounded, 9,847 of them so seriously they could not return to duty.

Our troops still have not found a missing U.S. pilot whose F-16 fighter jet crashed northwest of Baghdad Monday. The Air Force today said the pilot was operating out of Balad Air Base, north of the Iraqi capital. Officials believe the pilot was probably killed in that crash.

Large numbers of Iraqis are also being killed in this war, of course. As many as 3,700 killed last month alone.

Former secretary of state Colin Powell today said Iraq's violence has now escalated to the level of civil war. Powell, of course, a prominent supporter of the president's decision to go to war. Powell went to the United Nations in February of 2003 to argue that Saddam Hussein possessed weapons of mass destruction, an assertion that of course later turned out to be wrong.

The Iraq Study Group will issue its report on the future direction of American strategy in Iraq one week from today. The bipartisan group is led by former secretary of state James Baker. The leading Democrat on the group, Lee Hamilton, spoke just a short time ago.

(BEGIN VIDEO CLIP)

LEE HAMILTON, IRAQ STUDY GROUP: Let me say two things about the Iraq Study Group.

Number one, early this afternoon we reached a consensus. And number two, we will announce that on December 6th.

That's all I can say.

(END VIDEO CLIP)

DOBBS: Again, that report will be released next Wednesday, one week from today.

Iranian president Ahmadinejad today offered his opinion of what the United States should do in Iraq. Ahmadinejad wrote a letter, as he styled it, to the American people, saying the United States should withdraw from Iraq. Ahmadinejad also tried to play the role of political analyst for the United States, telling congressional Democrats that they will "be held to account by the people and by history" if they do not change U.S. policy, the responsibility for which they now have a share.

The U.S. ambassador to the United Nations, John Bolton, was not impressed at all.

(BEGIN VIDEO CLIP)

JOHN BOLTON, U.S. AMBASSADOR TO U.N.: With respect to President Ahmadinejad's letter, which I understand from press reports is addressed to the American people, this American person hasn't seen it yet. And I know you in the press have it, so maybe that's who he's really addressing the letter to. But I won't comment on it until I see it, although I understand it's only five pages, and not 18 pages like the last one, so that's a step ahead.

(END VIDEO CLIP)

DOBBS: And unlike that last letter, a very important issue was missing from the Iranian president's letter, making no mention at all of Iran's nuclear weapons program or proposed sanctions against Iran if they continue to proceed with their nuclear weapons program.

Still ahead here, the illegal alien lobby is now threatening the U.S. Congress and the American people with massive new street demonstrations and protests. Tonight we'll have a special report on the illegal alien movement's challenge to the new democratically- elected Congress.

Also, the Bush administration is determined to create a North American union without consultation or approval of the people of this country or our Congress.

We'll have that story.

And the risk to our democracy from e-voting. The looming threat to the next presidential election from paperless voting the subject of our next special report.

Stay with us.

(COMMERCIAL BREAK)

DOBBS: A new push tonight to grant amnesty to millions of illegal aliens in this country. And new leadership in Mexico going to office later this week plans for a North American union expected to move ahead without congressional or, of course, the approval of the American people.

Casey Wian tonight reports on amnesty advocates pressuring the new Congress to quickly pass so-called comprehensive immigration reform. That's right. Here we go again.

And Christine Romans reports on the effort to create the security and prosperity of partnership that many call a North American union.

We begin with Casey Wian in Los Angeles tonight -- Casey.

CASEY WIAN, CNN CORRESPONDENT: Lou, the streets of Los Angeles and other U.S. cities could soon be filled with demonstrators demanding amnesty for illegal aliens.

(BEGIN VIDEOTAPE)

WIAN (voice over): Some organizers of this spring's protests in favor of illegal alien amnesty say they may take to the streets again if the new Democratic-controlled Congress does not pass an immigration reform bill that includes amnesty within its first 100 days in power.

SAUL SOLORZANO, CENTRAL AMERICAN RESOURCE CENTER: I certainly believe that 100 days are plenty to have Congress act on the immigration issue. The First Amendment gives the right to petition the government. And I think that civil participation is important, and I think that people will be posed to go back and again ask for action.

WIAN: Solorzano says the perfect storm now exists with President Bush, Republican party chair Mel Martinez, and top Democratic lawmakers all favoring a path to citizenship for millions of illegal aliens. However, the House Democratic leadership has failed to include illegal immigration or border security among its top legislative priorities.

New Senate leader Harry Reid says an immigration bill will be among the first 10 introduced in the Senate.

SEN. HARRY REID (D-NV), MINORITY LEADER: It was tremendously heartwarming to see how the Hispanic community throughout America responded to what we tried to do, we Democrats tried to do. We won big-time with the Hispanics. We won because they accepted what we were trying to do, comprehensive immigration reform.

WIAN: Reid says he wants a guest worker program and a path to legalization for illegal aliens and he has no problem with threats of new demonstrations.

REID: I've always said that those marches were good. They didn't hurt a thing. They were peaceful and they were powerful. That's what America is all about.

WIAN: He also says there will be no additional funding for the border fence bill signed by President Bush. Ironically, that bill was passed in part because of frustration with previous pro-amnesty protests.

(END VIDEOTAPE)

WIAN: Other spring protest organizers we spoke with say they are in no hurry to return to the streets. They say they are pursuing a strategy of unity with the new Democratic leadership -- Lou.

DOBBS: Harry Reid sounded just enthralled by the fact that the Democratic vote among Hispanic voters that did go to the polls rose from 60 to 69 percent. Such euphoria on that move?

WIAN: Yes, it was certainly surprising that he was so euphoric about that, and especially his comments about amnesty and the border fence from a senator who, as you well know, Lou, was not too many years ago a strong advocate of border security.

DOBBS: Right. And I think it's -- I think it's illuminating that Senator Reid attaches the fact that a person of Hispanic origin in this country voted for a Democrat, in his judgment, simply on the basis of comprehensive immigration reform in the Senate, as if Hispanic-Americans would not be as unhappy and dissatisfied with the Bush administration and the Republican Congress as any other American irrespective of their ethnicity.

WIAN: He seems to be buying into the argument that many of the amnesty advocates make that are linking race with the issue of border security, which we know from election results in Arizona and other places is not true -- Lou.

DOBBS: Not true, but it looks like we -- if that performance is any indication, in my opinion, it looks like we may be back to the same tactics on the part of the Democratic leadership in the Senate as we saw on the part of the Republican leadership.

Casey, thank you very much.

Casey Wian.

When Mexican president Vicente Fox leaves office this week and Felipe Calderon takes his place, President Bush will be the last of the so-called three amigos. Bush, Fox, and, of course, Canadian prime minister Paul Martin were the originators of the so-called Security and Prosperity Partnership, which critics call nothing more than a North American union. It means open borders, commerce of all costs, and, by the way, without the approval of either American voters or the U.S. Congress.

Christine Romans reports.

(BEGIN VIDEOTAPE)

CHRISTINE ROMANS, CNN CORRESPONDENT (voice over): Waco, Texas, 2005. Under these three men, the Security and Prosperity Partnership was born. An effort, the governments say, to harmonize regulation and increase cooperation between three very different countries.

The Mexican president in Cancun this spring...

VICENTE FOX, MEXICAN PRESIDENT (through translator): We need to elevate the competitiveness of our economies.

ROMANS: And a new Canadian prime minister joining the discussions as this North American partnership barrels ahead, with departments and ministries of all three governments working quickly to integrate North America by 2010. The official progress report boasting, "Implementation is on track."

And now Mexico's new president, Felipe Calderon, widely expected to keep the progress moving. Critics, though, say there's too little transparency and no congressional oversight.

TOM FITTON, JUDICIAL WATCH: There's nothing wrong with neighboring governments talking to each other, synchronizing their watches to make sure they're all on the same page in the cases of emergency or on trade issues or even on the flows of goods and people. But if policies are being made that the American people might oppose, or that are contrary to the law, especially as it relates to immigration, you know, they're doing something a bit more nefarious.

ROMANS: He points to SPP documents urging the free flow of goods and people across borders and a wish list from business interests that borders remain open during a flu pandemic. Worse, critics say foreign policy elites are promoting a European-style union, erasing borders between the three countries and eventually moving to a single North American currency called the amaro (ph).

A Commerce Department spokesman, however, denies this -- "There is absolutely no plan for a common currency."

(END VIDEOTAPE)

ROMANS: Speculation about that erupted again this week after some in the Canadian business contingent included a list of their long-term goals for the SPP. But people involved with the partnership between the three countries are very quick to distance themselves, Lou, from that very, very unpopular idea.

DOBBS: The fact is -- and everyone watching you and that report tonight -- for any American to think that it is acceptable for the president of the United States and this executive department of his government, his administration, our government, to proceed without the approval of Congress or a dialogue and a debate and a -- and a public voice from the people of this country is absolutely unconscionable.

ROMANS: The defense of those folks who are saying that they're involved with the SPP is that they're not doing anything that would require congressional approval or voter approval. They're just harmonizing the regulations between the three countries.

DOBBS: What they're doing is creating a brave new world, an Orwellian world, in which the will of the people is absolutely irrelevant. And I think we've had a sampling of what's going to happen to people who do that in the future.

I can't imagine this standing. But then again, I couldn't imagine its beginning nor the fact that it's gotten this far.

Christine, thank you.

Christine Romans.

That bring us to the subject of our poll tonight. A North American union, Mexico, the United States and Canada, a really good idea or a really bad idea?

Cast your vote, please, at LouDobbs.com. We'll have the results here later.

And just ahead, long lines, missing votes and voter machine breakdowns. The election of 2006 not error-free. We'll tell you what some lawmakers want to do to prepare for our presidential election in two years.

And a new study shows the American dream is just a dream for many Americans. College tuition costs are spiraling out of control.

We'll have that special report.

And the selling of our skies and our national security. Shocking new evidence tonight that the United States government wants to give control of our airlines to foreign investors, or is it the U.S. government, or is it the Bush administration?

We'll have the answers here next.

Stay with us. (COMMERCIAL BREAK)

DOBBS: From California to Kentucky, electronic voting machines proved to be anything but failure-proof during the midterm elections. Now some lawmakers are trying to make certain that missing votes and machine breakdowns and possibly machine manipulations are at least not part of our next presidential election.

Kitty Pilgrim reports.

(BEGIN VIDEOTAPE)

KITTY PILGRIM, CNN CORRESPONDENT (voice over): It wasn't a meltdown, but it was far from trouble-free.

DOUG CHAPIN, ELECTIONLINE.ORG: While you can point to results and say, well, the results were -- were clean, there's enough doubt about the process in individual voters' eyes that we've got work to do to increase voter confidence in the system in '08 and beyond.

PILGRIM: In Denver, long lines lasted hours when the electronic voting registration failed.

In Florida's 13 congressional district, the 18,000 votes didn't register. Did voters abstain or did the machines drop them? No answer yet. The recount complicated because there is no paper trail.

In Georgia, Illinois, Texas, New Jersey and Ohio, charges of vote-flipping, the machine showing the wrong candidate on the screen.

Because activists were so vocal before the election, some of the problems may have been headed off. For example, in Maryland, a disastrous primary turned into a smooth Election Day.

In troubled Cuyahoga County, Ohio, Election Day was relatively smooth but expensive because of last-minute precautions. The county is talking about dropping the current voting system.

Lawmakers are looking ahead to 2008 with tough new legislation requiring voter-verified paper trail and random audits.

REP. RUSH HOLT (D), NEW JERSEY: The legislation also would require that the software be made available for inspection. It would require that there be no wireless connections or Internet connections to the voting machines. And I think those would go a long way toward restoring confidence.

PILGRIM: Holt believes that legislation, because it has so many co-sponsors, will pass easily in the new year.

(END VIDEOTAPE)

PILGRIM: In Sarasota County, the home of the missing 18,000 votes, an audit found several discrepancies in a retest of the equipment. Now, the voting machines had miscounts. That race is still contested and the state-run audit is not complete, even now -- Lou.

DOBBS: And it's almost irresistible, Congressman's Holt's legislation, to -- and it's certainly not a complete panacea for this -- this issue. But his legislation, it seems, straightforwardly, it should be enacted in order to at least reduce that level of possible problems.

PILGRIM: It certainly seems like common sense.

DOBBS: Kitty Pilgrim, thank you very much.

Time now for some of your thoughts.

Elaine in Michigan, "How do we expect our children to follow the law when they see illegal immigrants breaking them constantly and our government going along with it?"

And Bill in New Jersey: "Dear Lou, It is instructive that the Chinese government, one of the most repressive on earth, selects the Justice Department of the United States for lessons in the suppression of dissent. What do the Chinese know about the Justice Department that we can only surmise?"

And Debbie in Tennessee: "What happened to the American in the American Civil Liberties Union? Why is the American Civil Liberties Union fighting for non-Americans? American taxpayers and American towns are drowning in debt from the illegal aliens, why aren't the ACLU groupies fighting for these Americans?"

Send us your thoughts to LouDobbs.com. More of your thoughts, upcoming. Each of you whose e-mail is read here receives a copy of my new book, "War on the Middle Class".

And for more on this country's war on the middle class, and faith-based trade policies that are contributing to it, my column is on the CNN.com Web site or LouDobbs.com.

Coming up next, the war on our middle class. A new study highlights the crisis in American higher education and the crisis for American middle class families.

Also, if the ports deal with Dubai wasn't enough, we now have a new national security giveaway to concern ourselves with. The Bush administration preparing to give foreign investors control of American Airlines. We'll have that special report and we'll also update you on what's going on with those Dubai port world deals.

President Bush and the Iraqi prime minister, preparing for talks in Jordan. I'll be joined by three of the country's best political analysts here next.

Stay with us.

(COMMERCIAL BREAK)

DOBBS: The rare type of radioactive material linked to the death of a former Russian spy has now been discovered on two British airliners. British Airways is asking tens of thousands of passengers who may have flown on those jetliners to contact health authorities. Two Boeing 767s at London's Heathrow Airport tested positive, and a third was grounded.

The airline says the health risk is low. But it's trying to reach people who may have been aboard those jets since October 25th and have come into contact with polonium 210, the deadly substance.

A deal that drew outrage and condemnation all across the nation, in part because of our reporting here, may be finally coming to a resolution. D.P. World, a Dubai-owned company, says it is accepting what it calls final bids for its U.S. port operations within the next two weeks. The bidders, who were not identified by Dubai Ports World -- they do, however, say all of the bidders are American.

The original deal that allowed the Dubai company to take over operations at six U.S. ports was first highlighted back in February on this broadcast. Following the uproar, D.P. World said it would sell all its 21 port operations to an American-owned company.

Apparently the Bush administration didn't learn much from its Dubai Port fiasco. Incredibly, it appears the Bush administration is going ahead with a plan to give control of our airlines to foreign investors, despite the fact that the United States Congress has expressly disapproved that idea.

Bill Tucker has the report.

(BEGIN VIDEOTAPE)

BILL TUCKER, CNN CORRESPONDENT (voice-over): Domestic control of our airlines appears to be coming to an end. That, despite overwhelming bipartisan opposition in Congress to a rule change that would give day-to-day operational control to foreign investors.

REP. FRANK LOBIONDO, (R) NEW JERSEY: Aviation is a very critical component of homeland security and of our economy. And I don't think we can afford to do anything which even brings into question that homeland security would not be under complete control of the United States and the United States interest.

TUCKER: Rumors of the imminent change prompted members of the House Committee on Transportation and Infrastructure to remind the White House of their opposition in a letter, quote, "... Congress has taken a strong position that a major change to the current law regarding foreign ownership of U.S. airlines should be accomplished only by Congressional action, not unilaterally imposed by the Executive Branch. Making the rule final in the face of bipartisan Congressional opposition would be a very poor start to the 110th Congress..."

The administration says it not only has the right to make the rule change, Congress is making a big deal out of nothing. Yet back in February, the representative of the Department of Transportation conceded the obvious. JEFFREY SHANE, DEPT. OF TRANSPORTATION: They would be able to make the commercial decisions that define the shape of the product, the quality of the product, the routes that were flown.

TUCKER: As well as what planes to buy, where they're maintained.

REP. PETER DEFAZIO (D), OREGON: I mean, the national security implications losing control of the Civilian Reserve Air Force fleet, the massive job losses for American pilots, flight attendants and others associated with the airlines, and in all probability dramatic cutbacks in domestic service.

TUCKER: If DOT makes the change, DeFazio and Lobiondo say Congress will override it.

(END VIDEOTAPE)

TUCKER: Now, we repeatedly called the Transportation Department asking for comment, asking if a rule change will, in fact, be announced soon. The Department had no comment.

Lou, this is all being done as so often it is in the name of free trade. The United States, seeking to gain landing rights in Europe and in London. Amazingly, those European airlines already have landing rights here. We're not denying those right, we're just giving away the airlines to land in Europe.

DOBBS: Well, "we" is a big word. The Bush administration, with its manifest -- what does George Bush -- I mean, straightforward, this administration, do they understand this is an American government, a democracy, a representative government?

It is absolutely insufferable to tolerate this kind of arrogance. Thank goodness that the Congress is standing up. And thank goodness we're going to have some oversight and some checks and balances, we hope, in this new government.

Bill Tucker, thank you very much.

A disturbing -- that's what we need here, is another disturbing report, illustrating the higher education crisis in this country. While college costs are skyrocketing, financial aid is dwindling. And middle class Americans, of course, paying an ever higher price.

Lisa Sylvester reports.

(BEGIN VIDEOTAPE)

LISA SYLVESTER, CNN CORRESPONDENT (voice-over): There is a crisis in American higher education that is largely being ignored by the nation. That's a new stark warning from the National Conference of State Legislatures.

DENIS MERRILL, CONNECTICUT STATE HOUSE: It's pretty clear that access to higher education is shrinking, and that that has tremendous for the country because other countries are starting to catch up. SYLVESTER: In plain terms, the bipartisan group of legislators spells out: "The American higher education system no longer is the best in the world. For every 100 ninth graders who enter high school, only 18 finish college within six years."

The report, highlighting the gap between the haves and have nots warns the poorest individuals have only an 8 percent chance of obtaining a college degree, compared to a 70 percent chance for the wealthiest individuals.

MARI LUNA DE LA ROSA, THE INST. FOR COLLEGE ACCESS: When you take into account the rising cost of college, that college is becoming more inaccessible, especially for students who are in the low income ranges and backgrounds.

SYLVESTER: College tuition rates have increased 35 percent over the last five years, more than double the rate of inflation, according to the College Board. Pell Grants used to cover the cost of a public education. Now students are lucky if it covers a third. That means more middle class families are going into debt.

DANIEL RAPPAPORT, STUDENT: I had financial aid my first two years of college, and once it went away, that's thousands of more dollars that I have to put in.

SYLVESTER: Cost is not the only reason students are failing to earn a college diploma. Some drop out because of shortcomings at the high school level. They start college inadequately prepared.

(END VIDEOTAPE)

SYLVESTER: The legislative group recommends that states and the federal government, rather than continuing to shift the cost to students and their parents, need to increase public funding for higher education. Also more emphasis needs to be placed on making sure high schoolers are taking college preparatory classes -- Lou.

DOBBS: Lisa, the idea that only 18 out of 100 students entering high school make it through college over a six-year period, that's so astounding. The very idea that with all of these great state-funded and taxpayer-funded universities and colleges across this country, that we can't do better than that is shameful.

SYLVESTER: It's pathetic, it's sad and it's a real problem that people need to know and be aware of, and that really our lawmakers need to do something about it because it is a crisis as this reports has outlined, Lou.

DOBBS: And as I say here and I've said in every other quarter that I can, our public education system is a great equalizer in this society. But when you look at numbers that say that eight percent of the poor in this country, that's the probability that their kids will be going through college, and 70 percent for the wealthy, that speaks volumes about what we can look at as the bridge -- the gap, rather, between the haves and the have notes for the next generation. It's -- we've got to do something. Lisa, thank you very much. Lisa Sylvester from Washington.

James Baker's Iraq Study Group may recommend talks with both Iran and Syria. I'll be talking with Syria's ambassador to the United Nations about what his government's position is in helping the United States in the Middle East.

And a heated exchange between President Bush and the newly elected senator from Virginia, Jim Webb. We'll tell you what the showdown was all about. Stay with us.

(COMMERCIAL BREAK)

DOBBS: The Iraq Study Group may push both Syria and Iran to the forefront in the Iraq war.

Joining me now, the Syrian ambassador to the United Nations, Bashar Ja'afari.

Good to have you with us, Ambassador.

BASHAR JA'AFARI, SYRIA AMB. TO U.N.: Thank you very much for meeting with me again.

DOBBS: This Iraq Study Group before it has published its documents and its recommendations has been -- has elevated both Syria and Iran as a possible -- a possible -- change agent and perhaps a major player in resolving Iraq. Is your government ready to help?

JA'AFARI: We welcome the study elaborated by Mr. Baker and Hamilton. And I think that we know very well Mr. Baker because we worked with him a long time ago, and we know his skills as diplomat and his capacities in confidence-building measures in the area.

So we are -- we have been actually turned towards any overture (ph) on the side of the American administration for quote some -- a long time. The problem is that, you know, we are waiting for the other side, I mean, the American administration, to take any step, any positive step.

DOBBS: Any positive step. And what would that positive step be? Simply picking up the phone and calling and saying, let's talk, or -- the question I have, really, is to what degree can Syria, since it -- you and I have discussed this before. You say Syria has played no role in Iraq. What positive role can they play?

JA'AFARI: There is, Lou, a broad agreement all over the world, either among what do you qualify as pro-Syrians or among who you qualify as anti-Syrians, that the role of Syria should not be neglected or ignored.

DOBBS: Well, the United States classifies your country, your nation, as a sponsor of terrorism and makes no -- there's no equivocation about it. Is there a possibility in what would be your interest in helping the United States, first, resolve the situation in Iraq, and extricate itself from what is near, at least, if not the worst, a civil car? JA'AFARI: Any help from Syria should be based on the rule of reciprocity. The help should not be unilateral. We, too, we are waiting for gestures coming from the American administration at many levels in Iraq, in Lebanon and in Palestine. We are an original player in the area, and the American administration should discuss with us in this -- at the time.

DOBBS: As you know, there is some concern amongst a number of analysts that if this war in Iraq is not resolved, that not only will Iraq remain in a -- what is near or some suggest now a civil war, but also Lebanon will be further destabilized, Jordan and certainly possibly Syria as well. You talk about reciprocity. What would you have the United States reciprocate with?

JA'AFARI: We need peace in the area. We need to solve the Arab- Israeli conflict and the Palestinian question. We need to see a Palestinian state established in Palestine. This is what we need. We need to see the American troops withdrawing from Iraq, and we want to see Lebanon stabilized once again.

DOBBS: Ambassador Ja'afari, we thank you for being here.

JA'AFARI: Thank you very much.

DOBBS: Good to see you again.

JA'AFARI: I appreciate it.

DOBBS: Just ahead, President Bush and Virginia's newest democratically-elected Jim Webb -- well, he's democratically-elected but he's a Democrat -- they're going head-to-head over Iraq, of all things. We'll have that story.

And the president and the Iraqi prime minister meet tomorrow in Jordan. And I'll be joined by three of the country's best political minds next. Stay with us.

(COMMERCIAL BREAK)

DOBBS: Well, something of a brush-up at the White House between President Bush and the newly elected senator from Virginia, Jim Webb. It's the talk of Washington, we are told, tonight. Jim Webb, a highly decorated Vietnam veteran, his son serving in Iraq with the Marine Corps. The President and Jim Webb met at the White House. Jim Webb says he tried to avoid it.

Here's the exchange as it went, we're told.

Bush: "How's your boy?"

"I'd like to get them out of Iraq, Mr. President."

"That's not what I asked you," Mr. Bush said. "How's your boy?"

Senator-elect Webb: "That's between me and my boy, Mr. President." The senator says he wasn't looking for a confrontation. But Jim Webb is not exactly a fellow to back away from one, either.

Joining me now is Mark Halpern. He's the political director at ABC News, co-author a scary book, "The Way to Win: Taking the White House in 2008".

Good to have you here.

And Democratic strategist, Democratic National Committee member Robert Zimmerman, and all-around good guy.

And Errol Louis, columnist at the "New York Daily News", member of the Editorial Board, also a pretty good fellow.

Good to have you here.

What do you make of the senator-elect's comeback?

ERROL LOUIS, "NEW YORK DAILY NEWS": Well, you know, he's saying, oh, gee, I went out of my way. He tried to walk away from the president. He says he didn't want the confrontation. But he didn't have to be there. You know, he didn't have to sort of ratchet it up in the way that he did. And so I think he's kind of still on the campaign trail a little bit. I mean, he got elected by people who were pretty angry at the president and apparently that has clung to him a little bit.

DOBBS: Well, we can't blame him, in my opinion, too much, Mark, because there are a lot of folks who are governing as if they were still on the campaign trail. I'm not naming any names.

MARK HALPERN, ABC NEWS: Well, if Washington's going to be different in January, I think this is a preview. Jim Webb is one of eight new senators on the Democratic side. A lot of these people are iconoclastic. They don't give a rip, as Bill Clinton would say, about the normal...

DOBBS: Hallelujah!

HALPERN: .. about the normal...

(CROSSTALK)

HALPERN: ... pass the plate to these candidates, because they're going to be senators come January, and I think you're going to see of this not just at the White House but all over Capitol Hill.

ROBERT ZIMMERMAN, DEMOCRATIC STRATEGIST: And I think Jim Webb is not on the campaign trail. I think this is who he is. He's the real deal and I give him credit for his candor. And I think what you're also seeing is an emerging coalition amongst Republicans and Democratic moderates in the House and Senate to get things done and to hold this administration accountable on Iraq.

DOBBS: Robert Zimmerman, we're going to have every word you utter up there ready to hold before you when the 110th Congress takes hold. And we all, of course, hope you're right.

The "New York Times" publishing the classified memo from Stephen Hadley, the national security adviser, saying, quote, "... The reality on the streets of Baghdad suggests Maliki is either ignorant of what is going on, misrepresenting his intentions or that his capabilities are not yet sufficient to turn his good intentions into action."

Errol?

LOUIS: Well, you know, look, it will, over time, probably be seen as one of the factors that helped destabilize that government. But as we've seen from the Muqtada al-Sadr faction walking out, that pretty much everything in that memo was true. I don't know if you had to go much further than the casualty reports, the unfolding civil war that everyone's watching, the open talk...

DOBBS: You mean the reality?

LOUIS: ... the open talk of partition of the country. It's all falling apart and that prime minister has got to take that responsibility at some point.

DOBBS: Muqtada al-Sadr pulled 30 from the block of 128 in the Parliament, six ministers of the 32 in the Iraqi government -- Mark.

HALPERN: Look, the Bush administration said, look, military progress: slow, economic progress: slow. But what they've always pointed to is political progress. This is a real threat to the unraveling of political progress in Iraq. Whatever the American military commitment is, the president would like to leave behind a strong government.

This suggests that they have doubts that the current government, which is in office for awhile unless something dramatic happens, is not necessarily going to be able to hold the center, to the extent that there is one, in Iraq. It's a big -- there are 101 theories about why everything was written. But there's -- all of them are bad for progress.

DOBBS: And, as Mark is suggesting, finding -- holding the center in Iraq, finding the center in the United States is critically important, because as President Ahmadinejad of Iran points out, the Democrats now will share with the new Congress policy responsibility for what happens.

ZIMMERMAN: We don't need to be lectured by the president of Iran about policy responsibility or about history or, for that matter, about integrity. The man has truly disgraced himself in the civilized world by his conduct.

But the point here is you do see in the Congress now emerging, in fact even from the coalition that's going to hold this administration accountable for its Iraq policy -- and even encouraged by comments by the nominee, by Bob Gates, the secretary of defense nominee -- designee, in terms of the way he's responded to inquiries during his confirmation process, pointing out that the administration, in fact, made mistakes. There has to be a different approach to addressing this issue. And clearly the bottom line, I think that's emerging, is this is the Iraq government's civil war to win or to lose.

And it is not going to be -- it's not going to help America in the war on terror to be refereeing a civil war.

DOBBS: So you're saying that the Democrats in 2008 wouldn't be holding the Republican administration accountable for the conduct of the war in Iraq, and put it squarely on the Iraqis?

ZIMMERMAN: I'm saying to you that we're going to always hold the administration accountable for bringing us into this war. But we're also going to work collectively to try to resolve it.

DOBBS: Does that work for you?

LOUIS: Well, it's the only path forward. I mean, you've got new regional players. You just had one of them on the show with you. Syria, Iran, they are regional players. They are saying so. They are announcing it.

That letter wasn't aimed -- it was addressed to Americans. It wasn't for Americans. It was for the whole rest of the world, to say that we're on the world stage, we're a regional player, and you will not move forward without talking to Iran and Syria.

ZIMMERMAN: One of the great travesties of the Bush administration's policies in Iraq is that they have done for Iran what Iran could not do on their own. Iran fought Iraq for eight years to try to be a central player in the Middle East. Our incursion there and the tragically inexcusable way we executed it resulted in making Iran a major player.

DOBBS: Robert Zimmerman, Mark Halpern, thank you very much. Errol, thank you very much.

You gave us a lot to chew on here. And that book about winning is still -- I think it ought to be -- do you think we should ban that book?

ZIMMERMAN: I think that Democrats ought to read that book.

(CROSSTALK)

HALPERN: Ban it or buy it, "The Way to Win".

DOBBS: Ban it or buy it, you got it.

Thanks for being here, gentlemen.

Still ahead, the results of our poll tonight. We'll have more of your thoughts. Stay with us.

(COMMERCIAL BREAK)

DOBBS: The results of our poll? 94 percent of you saying you believe a North American union is a really bad idea.

Time now for more of your thoughts quickly.

Gina in New York: " Dear Lou, All American that drive cars and use oil heat support terrorism and that other wacko, Chavez. Tunnel- vision politicians who don't want us to use our own energy resources are also supporting terrorists."

Jody in Maryland: "How ironic! American corporations can legally do business with terrorist countries but it's illegal to bring Cuban cigars into the USA. What's going here? Have we totally lost our marbles?"

Thanks for watching tonight.

Good night from New York.

"THE SITUATION ROOM" begins now with Wolf Blitzer -- Wolf.

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