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Lou Dobbs Tonight

President Bush Begins Three Days Of Intensive Consultations About Strategy Of Iraq War; Democrat Under Investigation Just Won Reelection And Is Demanding Powerful Committee Seat Back; Treasury Secretary Henry Paulson Leading Top-Level Government Delegation To Beijing; Investigation Into Poisoning Assassination Of Alexander Litvinenko Developing On Three Fronts; Gary Ackerman Interview; Ted Poe, Walter Jones Interview

Aired December 11, 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 calls the war in Iraq the calling of our time and says the United States must succeed. But President Bush stops short of saying victory is his goal.
We'll have special reports tonight from the White House and Baghdad.

And a new ethics scandal in Washington. A Democratic congressman under investigation by the FBI is set to take over the congressional panel that overseas, you guessed it, the FBI budget.

We'll have that report, all of the day's news, a great deal more straight ahead here tonight.

ANNOUNCER: This is LOU DOBBS TONIGHT, news, debate and opinion for Monday, December 11th.

Live in New York, Lou Dobbs.

DOBBS: Good evening, everybody.

President Bush today began three days of intensive consultations about his strategy in the war in Iraq. President Bush went to the State Department, and there he insisted the United States must achieve success in Iraq, but the president did not use the word "victory," a word he has used frequently in the past.

The president's consultations come amid signs the Iraqi government is rapidly losing support among its own supporters. An increasing number of Iraqis say the war cannot be won without major political reform.

Ed Henry reports from the White House on the president's struggle to come up with a new strategy.

Nic Robertson reports from Baghdad on reports that a power struggle has broken out within the Iraqi government.

And Brian Todd reports tonight from Washington on new questions about the competence of the incoming head of the House Intelligence Committee, Congressman Silvestre Reyes. We turn first to Ed Henry -- Ed.

ED HENRY, CNN WHITE HOUSE CORRESPONDENT: Lou, a short time ago here the president wrapped up a meeting with retired generals and other military experts, part of a high-stakes effort to chart a new course in Iraq.

(BEGIN VIDEOTAPE)

HENRY (voice-over): Struggling to find the way forward in Iraq, the president stopped at the State Department to show is he in listening mode about new ideas.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: Success is a country that governs, defends itself, that is a free society that serves as an ally in this war on terror. And the reason why that's vital is because Iraq is a central component of defeating the extremists who want to establish safe haven in the Middle East.

HENRY: The president calling Iraq a central component instead of what he has said over and over, the central front in the war on terror. But White House spokesman Tony Snow quickly insisted it was not a change, raising questions about whether the president has a dramatic new approach. Or are these internal reviews by the State and Defense departments really just an attempt to give him political cover to ignore the recommendations of the bipartisan Iraq Study Group?

TONY SNOW, WHITE HOUSE PRESS SECRETARY: He is not selecting from a menu, from one column A or one from column B, but, instead, taking a very good, hard look at all of the analysis and all of the opinions and making decisions.

HENRY: But confronted with the stunning change of heart by a Republican senator...

SEN. GORDON SMITH (R), OREGON: Being blown up by the same bombs day after day, that is absurd. It may even be criminal.

HENRY: ... the White House did not sound ready for big change.

(on camera): A Republican senator is saying the president's policy may be criminal and it's immoral, and you are just saying.

SNOW: What would you like us to say? Should I...

HENRY: Don't you think you should answer for that? You're saying -- you said from this podium over and over that the strategy is victory, right?

SNOW: And it continues to be.

HENRY: You have a Republican senator saying there is no clear strategy, that you don't have a strategy.

SNOW: Well, let's let Senator Smith hear what the president has to say. We understand that this is a time where politics are emotional in the wake of an election. And you know what? Senator Smith is entitled to his opinion.

(END VIDEOTAPE)

HENRY: Senator Smith is entitled to his opinion, but his views will not necessarily be heard here. A key distinction as the president gets set to unveil what we expect to be a major speech probably before Christmas -- Lou.

DOBBS: Ed, thank you very much.

Ed Henry from the White House.

The White House tonight is strongly denying reports that Iraqi politicians are plotting to remove Prime Minister Nuri al-Maliki from office. The White House declares it has full confidence in al-Maliki, but lawmakers in Baghdad say they are trying to oust al-Maliki amid rising concern about the government's failure to stop the violence.

Nic Robertson has the report from the Iraqi capital -- Nic.

NIC ROBERTSON, CNN SR. INTERNATIONAL CORRESPONDENT: Lou, a spokesman from the prime minister's office says absolutely not, that he's not about to be thrown out of office. However, there are deep political divisions.

Just a couple of weeks ago, the firebrand cleric Muqtada al-Sadr removed his parliamentarians from the parliament here, some 30 MPs. That was the first indication of the prime minister losing some of his key allies within the -- within the parliament.

We've also seen some Sunni politicians join Muqtada al-Sadr. But what leading -- what leading government members are telling us now is that, within the government, across sectarian lines, they are trying to form a group that can bring an end to the sectarian violence. They describe themselves as moderates, but there certainly has been talk about the possibility of a cabinet reshuffle. But the prime minister's office saying no, the prime minister is here to stay.

Also, we've heard over the weekend some harsh criticism by Iraq's president, Jalal Talabani, of the Iraq Study Group's report. He says that it's unjust, unfair, and dangerous. He says this is the case because if U.S. troops are put in large numbers into the Iraqi army to train them, he said that -- that undermines the sovereignty of the Iraqi army, and if it undermines the sovereignty of the Iraqi army, it undermines the sovereignty of Iraq.

This is a stunning criticism by President Jalal Talabani. He is a Kurd, and until now has been a very staunch ally of the United States -- Lou.

DOBBS: Nic, thank you.

Nic Robertson from Baghdad.

Insurgents have killed six more of our troops in Iraq. Three of them killed in a single roadside bomb attack north of Baghdad yesterday. Forty-two of our troops have been killed in Iraq so far this month, on track now for this to be one of the deadliest months of this war.

2,932 of our troops have been killed since the war began. 22,057 of our troops have been wounded, 9,890 of them so seriously wounded they could not return to duty within three days.

Eighteen people on a U.S. Marine Sea Stallion helicopter today were injured when it made a hard landing in Al Anbar Province. The U.S. military says that hard landing was probably not caused by enemy fire.

The Iraq Study Group strongly criticized U.S. intelligence agencies for failing to have a clear understanding of the enemy in Iraq. It appears the congressman set to lead the House Intelligence Committee, Congressman Silvestre Reyes, also has some questionable lack of basic knowledge about the nature of the enemy.

Brian Todd reports from Washington -- Brian.

BRIAN TODD, CNN CORRESPONDENT: Lou, the man who will soon oversee U.S. intelligence agencies and authorize their money was indeed thrown off during a recent interview when he was asked about al Qaeda. Democratic congressman Silvestre Reyes, a six-year member of the House Intelligence committee and now tapped to be chairman, spoke with "Congressional Quarterly."

He was asked, "Is al Qaeda Sunni or Shia?" His response, "Predominantly -- probably Shiite.":

Al Qaeda is made up mostly of Sunnis. But Reyes could also not identify Hezbollah, long considered a terrorist group by the State Department.

The reporter, Jeff Stein, was accused of cheap shots when a previous article by him pointed out the top FBI counter-terror officials didn't know the difference between a Sunni and a Shiite. We asked Stein, was he ambushing them or Reyes?

(BEGIN VIDEO CLIP)

JEFF STEIN, "CONGRESSIONAL QUARTERLY": I don't sneak up on them at all. I'm not there to ask them this question. I go to ask them what their policies are, what they think about certain intelligence issues, counterterrorism issues.

(END VIDEO CLIP)

TODD: Reyes' office issued us this statement: "The 'C.Q.' interview covered a wide range of topics other than the selected points published in the story. As a member of the Intelligence Committee since before 9/11, I'm acutely aware of al Qaeda's desire to harm Americans. The Intelligence Committee will keep its eye on the ball and focus on the pressing security and intelligence issues facing us."

An aide to Speaker-Elect Nancy Pelosi tells CNN she does not regret choosing Reyes and still has full confidence in him -- Lou.

DOBBS: Thank you very much.

Brian Todd from Washington.

The British government tonight is apparently dropping the phrase "the war on terror." The British Foreign Office has reportedly told government officials to stop using the expression because it believes the phrase could anger Muslims.

However, many radical Islamists in Britain have no hesitation about their support of terrorism. A top British official yesterday said the security services are monitoring 30 conspiracies and a terrorist attack in Britain over the Christmas holiday is, according to the British government officials, highly likely.

Still ahead here, a congressman under investigation by the FBI is set to take charge of a committee that supervises the FBI budget.

We'll have that special report.

And a blistering attack by U.S. trade officials on communist China's unfair trade practices. But is our government still trying to appease Beijing? Will there be a change of policy?

We'll have the report.

And a water dispute between the United States and Mexico could threaten water supplies throughout the entire western United States.

We'll have that special report, all of the day's news straight ahead.

Stay with us.

(COMMERCIAL BREAK)

DOBBS: The Democrats vow to take on the culture of corruption in Washington, but are they just part of it? The Democratic congressman likely to head the committee that overseas the FBI budget is himself under investigation by the FBI. And the congressman who was found with $90,000 in his freezer headed for another term after being reelected to the House.

Lisa Sylvester reports on one Democrat under FBI scrutiny. His new job will give him oversight of the budget of the FBI.

Andrea Koppel reports on another Democrat under investigation who just won reelection and is now demanding his powerful committee seat back.

We begin tonight with Lisa Sylvester -- Lisa.

LISA SYLVESTER, CNN CORRESPONDENT: Lou, we saw former congressman Bob Ney and former congressman Duke Cunningham -- both lawmakers are now disgraced and out of office. But it's not just Republicans. Now there are allegations of wrongdoing involving a Democrat from West Virginia.

(BEGIN VIDEOTAPE)

SYLVESTER (voice-over): Depending on who you ask, Representative Alan Mollohan is either a very savvy real estate investor or a congressman who may have become rich by helping key friends.

KEN BOEHM, NATIONAL LEGAL & POLICY CENTER: In he year 2000 he was worth several hundred thousand dollars. Just four years later he was worth between - he had more than $6 million, as much as $24 million in assets.

SYLVESTER: According to financial disclosure reports, those assets include more than a dozen condos in Washington, D.C., and a North Carolina beach house. Mollohan and a former congressional staffer, Laura Kuhns, bought real estate investments along the Carolina coast.

Congressman Mollohan tapped the same congressional aide to head up one of five nonprofit organizations he set up in his West Virginia district. In the last five years, Mollohan, who sits on the Appropriations Committee, helped channel more than $150 million in taxpayer money to keep these economic development nonprofits thriving.

The National Legal and Policy Center filed a 500-page complaint with the Justice Department this year detailing Mollohan's business arrangements. But in a strange twist, Mollohan may end up chairing the very subcommittee that has jurisdiction over the Justice Department's budget.

MELANIE SLOAN, CITIZENS FOR ETHICS: It's well known that Mr. Mollohan is now under investigation by the Justice Department and the FBI, and it's a very awkward position for the FBI or the Justice Department to go to Mr. Mollohan, to talk about their appropriations, at the same time he is in charge of their purse strings.

SYLVESTER: A spokesman for Mollohan said, "The allegations and suggestions of wrongdoing made by the NLPC are utterly false," and added that the congressman made his fortune from an inheritance that he reinvested in a booming real estate market.

In a statement, Mollohan's former congressional aide said, "I have never personally profited from earmarks in any way, nor have earmarks funded my real estate investments or other personal purchases."

(END VIDEOTAPE)

SYLVESTER: The complaint filed against Mollohan also looks at campaign contributions. The executives and officers of these nonprofits that received millions of dollars in federal earmarks were quite generous to the Mollohan re-election campaign. They donated more than $12,000 between 2004 and 2006 -- Lou.

DOBBS: Lisa, thank you.

Lisa Sylvester from Washington.

Congressman William Jefferson, the Louisiana Democrat, won a strong election victory in a runoff Saturday, even though he is under investigation by the FBI. And now he will have to battle the Democratic leadership if he wants his committee seats back.

Andrea Koppel reports from Washington.

(BEGIN VIDEOTAPE)

REP. WILLIAM JEFFERSON (D), LOUISIANA: God bless you all.

ANDREA KOPPEL, CNN CONGRESSIONAL CORRESPONDENT (voice-over): Congressman William Jefferson had hardly finished celebrating his reelection Saturday when he began lining up support for another campaign -- winning back his seat on the powerful House Ways and Means Committee.

CNN has learned that Jefferson told Congressman Mel Watt, the outgoing chairman of the Congressional Black Caucus, he wants to be reinstated. That could put the eight term Louisiana Democrat on a collision course with Speaker-Elect Nancy Pelosi, who forced him off the tax writing committee in June.

REP. NANCY PELOSI (D-CA), HOUSE SPEAKER ELECT: It's very sad, but we are a Democratic -- our House Democratic Caucus is determined to uphold a high ethical standard. We've said it and now we are doing it.

KOPPEL: Pelosi's concern back then, that government allegations Jefferson may have accepted bribes, including $90,000 from an FBI informant found in his freezer, would hurt Democrats at the polls in November. Pelosi promised voters Democrats would get rid of what she called a Republican culture of corruption. And several Democratic aides told CNN, despite Jefferson's weekend win, it's "very unlikely he'll get his Ways and Means seat back."

Jefferson's office did not return our calls.

Jefferson maintains he's innocent and he's not been indicted or charged with any crime and an FBI investigation continues.

In June, he accused Pelosi of putting politics over his hard work, especially in the wake of Hurricane Katrina.

JEFFERSON: It is more of a scapegoat, I think, for the -- for the convenience of an argument that Mrs. Pelosi wants to make to gain the advantage in a political debate.

KOPPEL: Pelosi's decision to remove Jefferson from the committee prompted a sharp rebuke from the Congressional Black Caucus in June, which both sides tried to smooth over last week.

PELOSI: We're a family and like every family, from time to time, we have our disagreements.

(END VIDEOTAPE)

KOPPEL: And following Jefferson's victory Saturday, the Black Caucus again sprang to his side, trumpeting his victory, declaring that the voters have spoken resoundingly, and calling on all members of Congress to rally behind Jefferson -- Lou.

DOBBS: Andrea, thank you.

Andrea, at this point any indication whatsoever that the Justice Department is going to proceed with charges?

KOPPEL: Lou, we are getting an indication from DOJ that they may have some more information in April, but they are not expecting anything imminent.

DOBBS: Well, the congressman might be forgiven if he were to take think that justice is not swift in Washington, D.C., certainly.

Andrea, thank you very much.

Andrea Koppel from Washington.

That brings us to the subject of our poll tonight.

Do you agree with the soon-to-be House Speaker Nancy Pelosi? Do you believe congressmen who are being investigated for corruption should hold senior committee positions? Yes or no?

Please cast your vote at LouDobbs.com. Those results will be coming up here shortly.

As the investigation into the Foley ethics scandal widens, there's word tonight that some on the Democratic side knew about the congressman's inappropriate e-mails to male panels. CNN is told that Congressman Rahm Emanuel, a Democrat from Illinois, was among those aware of the inappropriate e-mails. And two Democratic leadership aides apparently knew about those e-mails and tried to peddle them to reporters more than a year ago.

Coming up next here, a high-powered U.S. delegation, including half a dozen members of the president's cabinet, heading to China. Are they going there with hat in hand or with strong words for the communist Chinese government?

We'll have a report on what this high-powered delegation is going to do. Maybe.

And traces of the Polonium-210 that killed a Russian spy spreading seemingly all over western Europe. How did airport radiation detection systems miss it? That's the question we have. Tonight we'll have the answers.

And the new water war. Mexico wants to stop the United States from plugging leaks in a canal along our border with Mexico.

We'll have that report and a great deal more. Stay with us.

(COMMERCIAL BREAK)

DOBBS: The Bush White House and its supporters in corporate America have been working overtime for the past six years to appease communist China on a host of issues. Most especially in terms of our record trade deficit with China.

Treasury Secretary Henry Paulson is now leading a top-level government delegation to Beijing for the first so-called strategic economic dialogue with China. That delegation is going to Beijing despite new evidence China has repeatedly broken world trade organization rules.

Christine Romans reports.

(BEGIN VIDEOTAPE)

CHRISTINE ROMANS, CNN CORRESPONDENT (voice-over): U.S. trade representative Susan Schwab delivering to Congress today a five-year checkup on China's trade compliance, detailing China's backsliding, finding "frustrating barriers to doing business in China..." and "worrisome signs that China's market liberalization efforts have slowed."

WILLIAM HAWKINS, U.S. BUSINESS & INDUSTRY COUNCIL: This USTR report that's coming out today pretty much lays out what the Chinese strategy is. It's ignoring their WTO, World Trade Organization, obligations.

ROMANS: China steals U.S. intellectual property, subsidizes its industrial base, undervalues its currency to make its exports more attractive. And according to the USDR, "hinders market access for the U.S." Since China entered the WTO, the U.S. trade gap with China has exploded.

Schwab dropping the report on the Hill on her way to Beijing with the treasury secretary, the fed chief, a handful of cabinet members and agency chiefs. A stunning array of administration officials heading for talks in China, but expectations running low and cynicism running high.

CAROLYN BARTHOLOMEW, U.S. CHINA COMMISSION: What on earth are they doing taking all these people over there if they think they aren't going to accomplish something? And also, what kind of message does that send to the Chinese government?

ROMANS: Congressman Randy Forbes says it's the same message the U.S. has been sending all along.

REP. RANDY FORBES (R), VIRGINIA: We basically define success as just being willing to have the Chinese talk with us. And if for some reason they ever agree with us on an issue, we just think that's a homerun. ROMANS: He says China makes promises that it does not keep, and U.S. policy has been woefully inadequate to meet China's mercantilist nationalist strategy.

(END VIDEOTAPE)

ROMANS: It was President Clinton who pushed to get China into the WTO, and now, five years later, this administration is calling China's compliance record "mixed."

Well, there was plenty of eyeball rolling on the Hill tonight that the administration is already playing diplomatic semantics with exactly what China's record is on the eve of their own big trade mission over there.

DOBBS: I love the idea that this administration would -- I'm shocked that they would play semantics with any public policy term. But this is absurd.

The idea that the United States laying out -- the trade representative laying out a list of absolute disasters in compliance and, of course, talking about a five-year record of deficits that amount to, what, somewhere in the neighborhood of, what, over a trillion dollars?

ROMANS: Absolutely. And pointing out in the report, Lou, how our exports have grown 190 percent over that period and how China has jumped from our 15th largest to fourth largest export market. But when you look at the -- at the red arrows in the piece hat show the deficit, it shows you just incredible what the deficit has actually been.

DOBBS: The simple straightforward fact is this administration is responsible for giving all of the levers and all of the advantage to the Chinese in this trade relationship and this geopolitical relationship because it simply does not have any kind of rationale policy, as you just pointed out.

Thank you very much, Christine Romans.

Time now for some of your thoughts.

Tom in Arizona wrote in and said, "Lou, the change of parties in Congress only changed the robbers of the middle class, not the robbery of the middle class."

Let's hope that changes.

And N. Bailey in Arizona said, "Do you think all U.S. citizens can put a moratorium on paying taxes until the Congress agrees to stop giving our country away? After all, if we don't own it, why should we pay for it?"

R.A. in Texas, "The Democrats have no more interest in preserving America's sovereignty, independence and freedoms than the Republicans have. America has a two-party political system, one fascist, the other communist."

Tough.

And Eugene in California, "Lou, about 35 years ago I joked with friends that our country would keep running even if a chimpanzee were elected president. I stand corrected."

Send us your thoughts at LouDobbs.com. We'll have more of your thoughts here later.

Each of you whose e-mails are read here receives a copy of my new book, "War on the Middle Class."

Up next, the Polonium-210 that killed a former Russian spy has been traced to various parts of Europe. How did it manage to find its way through all of those fancy sensitive radiation detection systems put in place to guard against terrorist attacks?

We'll have that report.

And a battle over water rights. Mexico doesn't want the United States to fix a leaking canal on our side of the border. We'll tell you why, but it's all part and parcel of what is the U.S.-Mexican relationship to date.

And it won't look a lot like Christmas for travelers at Seattle- Tacoma airport. We'll have a report on why the Christmas trees have been removed from sight, and we'll tell you about Rabbi Grinch.

Stay with us.

(COMMERCIAL BREAK)

DOBBS: The investigation into the poisoning assassination of Alexander Litvinenko is developing on three fronts tonight.

In Hamburg, Germany, police are scouring the home of four more people. They have tested positive for exposure to polonium-210 radiation. They were apparently contaminated by a German businessman who stayed at the home before he met with Litvinenko in London. German police say he may be one of the perpetrators, in fact, in this case.

In Moscow, another man at that London meeting questioned by Russian and British authorities, he claims he gave testimony purely as a witness. In London, police are said to be focusing their efforts now on the Millennium Hotel where the November 1st meeting took place with Litvinenko and seven bar workers. They have also tested positive for exposure to the radioactive poisoning.

All of which raises disturbing questions, and amongst the most disturbing, how did all of these people who left trails of radioactivity behind them everywhere they went go undetected by sensitive radiation detectors put in place in the war on terror?

Bill Tucker reports. (BEGIN VIDEOTAPE)

BILL TUCKER, CNN CORRESPONDENT (voice-over): We have the technology to detect radioactive materials on people. We use it at nuclear facilities. It's used at seaports and in airports and scanners for packages and baggage. But not for people.

FRANK GAFFNEY, CENTER FOR SECURITY POLICY: We have an open society, a free society. It is child's play to figure out ways to get into it and to screw it up. The job of securing it perfectly against every conceivable threat is an insurmountable problem. There's no getting around it. It's a question of triage.

TUCKER: The good news is radioactive materials are very difficult to transport. There are systems to detect them. Consuming enough of them to turn a person into a dirty bomb that represented a serious threat might not even be possible, but, there is a but.

PETER KANT, RAPISCAN SYSTEMS: Biology may limit your ability to ingest enough nuclear radiological material to actually become an effective, in this case, dirty bomb. And if you are able to ingest enough, then the sensors may be able to overcome that just by the sheer volume of radiological and nuclear material, but we just don't know. We just simply don't know.

TUCKER: There are other scenarios more chilling, such as infectious diseases for which there is no scanning technology.

(END VIDEOTAPE)

TUCKER: In the case of polonium, while it is highly radioactive, it's easy to conceal, and it doesn't represent a dangerous threat, unless it's ingested. Now, there are traces that are being found by the police that Lou mentioned.

And, Lou, the police are telling us those traces are most likely being left behind by sweat from Litvinenko and other people as they move from place to place.

DOBBS: To be honest with you, Bill, I have absolutely no confidence in what the police are saying here. We have four people seriously contaminated. These investigators at this point, neither in the continent nor in the U.K., are able to say how they were contaminated or how Litvinenko was contaminated.

TUCKER: Right.

DOBBS: And the idea that, again, five years after September 11, that they do not have radioactive detection in the machines in these airports is insane, particularly when our Homeland Security officials tell us point-blank that they're most concerned about a dirty bomb. How can we possibly rationalize that?

TUCKER: Well, they can't rationalize it. They don't detect it on people. They would in your baggage, but not if you were carrying it, oddly enough. DOBBS: Amazing. Bill, thank you very much. Bill Tucker.

Five of the six Muslim religious leaders who were removed from a U.S. Airways flight in Minneapolis have retained the Counsel on American Islamic Affairs, CARE, to represent them in any legal action against the airline. A spokesman for CARE says they are seeking a meeting with the airline and that it was premature to discuss what actions might be taken, although they are prepared, they say, to go to court if a settlement cannot be reached.

In November, passengers aboard the U.S. Airways flight complained the Muslim leaders were acting suspiciously, changing seats, asking for seat belt extensions. The men were removed from the flight, held for several hours before being released.

A deal to allow Dubai Ports World to own and operate American ports drew outrage all across the country at the beginning of this year. The Bush administration agreed to that deal in January. It's a story we first reported shortly thereafter.

But there is word tonight that D.P. World has finally agreed to sell those port interests. The buyer is the American insurance giant AIG. Dubai is located in the United Arab Emirates, a country linked to backers of the 9/11 attacks.

Mexico is deploying thousands of troops to battle drug cartels locked in a vicious turf war. Those troops will be headed to the Mexican state of Michoacan, located on the Pacific coast. Mexico faces rampant drug trafficking and crime. The country is a principal conduit for major supplies of drugs, in fact, the largest supply of those drugs entering the United States, among them, methamphetamine, cocaine, heroin, and marijuana.

Officials say the 5,000 soldiers and marines will be there to conduct raids and make arrests, as well as search for and destroy drug plantations. The drug cartel's activities have resulted in hundreds of murders in the region, this year alone as competing cartels are fighting for control of the region and, of course, lucrative trafficking rights.

A new battle over water tonight between Mexico and the United States. Millions of gallons of water are seeping from a canal on our side of the border into Mexico. The United States wants to plug the leak. Mexico is saying doing so would cause hardship on its side of the border.

Casey Wian reports.

(BEGIN VIDEOTAPE)

CASEY WIAN, CNN CORRESPONDENT (voice-over): The All-American Canal runs 82 miles along California's border with Mexico, but its name belies the fact that much of its water seeps underground into Mexico, irrigating crops owned by Mexican and American farmers.

But the water rightfully belongs to the United States and it plans to line the canal with cement to stop the loss of millions of gallons of water to Mexico each year. The project is on hold, however, because a Mexican business group and U.S. environmentalists are suing. They claim lining the canal would deprive 30,000 Mexicans of jobs and force many to cross the border illegally.

MALISSA MCKEITH, CURE ATTORNEY: The most critical issue facing the United States right now is the migration problems from Mexico. This water issue will only make that problem worse. It will force a lot of poor Mexicans out of work, and one of the only alternatives for those Mexicans will be to migrate to the United States.

WIAN: California water officials scoff at that notion. Under a 2003 agreement with the federal government and other western states, California agreed to a 15 percent reduction in its use of Colorado River water.

Recaptured water from the All-American Canal is supposed to make up part of the shortage. Mexico already receives nearly half a trillion gallons of Colorado River water each year.

JERRY ZIMMERMAN, CALIF. COLORADO RIVER BOARD: We'd encourage Mexico to do something similar to what California has done and to address what it needs to do within the Republic of Mexico to meet its critical water supply needs.

WIAN: Specifically, better water conservation infrastructure and management. In fact, the United States has offered technical assistance to Mexico in those areas, but Mexico hasn't accepted.

For now, the All-American Canal project has been halted temporarily by the Ninth Circuit Court of Appeals. If that decision stands, it could unravel the entire Colorado River water sharing agreement and throw the water supply of much of the western United States into chaos.

(END VIDEOTAPE)

WIAN: At the very least, legal challenges have already doubled the cost of the project in just the past four years to a quarter of a billion dollars -- Lou.

DOBBS: That Ninth Circuit Court of Appeals out there is a pretty interesting group of folks, isn't it?

WIAN: They sure are. They keep us pretty busy, Lou.

DOBBS: OK, thank you very much, Casey Wian.

Coming up next, we'll tell you who is pleading for a pardon for two U.S. Border Patrol agents who received harsh sentences for doing their jobs.

And we'll talk with a Democratic Congressman who says it's good foreign policy to share our nuclear technology with India.

And find out why the Christmas trees are being taken down in one of this nation's major airports. We'll have special coverage and perhaps offer a little kindly advice to the airport authority there about what they can do about Christmas. Stay with us.

(COMMERCIAL BREAK)

DOBBS: A landmark agreement to give U.S. nuclear technology to India authorized by Congress last week. The president expected to sign it this week.

Congressman Gary Ackerman supports that deal. He objected to our reporting on the issue. He joins us here tonight. We should point out he's also the co-chair of the India caucus -- the caucus for India and for Indian-Americans.

Good to have you here.

REP. GARY ACKERMAN, (D) NEW YORK: Thank you, Lou.

Good to be with you.

DOBBS: Now, I will -- at the outset, let me just say I think this is a very bad deal. I think it's a bad deal because it's inconsistent with overall policy which is, you know -- everyone in Congress is fond of saying now and this president, you know, they want to make things comprehensive. But they don't want to make anything comprehensible. This seems to fit the bill. U.S. -- you've got some mangoes here with you, Congressman. Can we see these?

The Congressman has a great sense of humor as well as a number of points to make. But the technology for mangoes deal, that Rob Portman, our U.S. -- then- U.S. trade representative put together, strikes me as utterly ludicrous.

ACKERMAN: But that has nothing to do with the nuclear deal that the Congress has just passed. And it's for civilian energy. This is not nuclear weapons.

DOBBS: right.

ACKERMAN: you know, there's -- there are five countries that are in the nuclear club: the U.S., China, Great Britain, France, Soviet Union.

DOBBS: You mean the official club?

ACKERMAN: The official club. Those are countries that tested 36 years ago, and the deal is nobody else can get into the nuclear club. And nobody's supposed to deal with them.

The reality is most of the world -- we've been working very hard to do this -- has signed on to the NPT, Nuclear Nonproliferation Treaty. India never has. If a country doesn't, they're not obligated to abide by the rules or regulations or guidelines, and people don't trade with them on a nuclear level.

India tested shortly thereafter and wasn't grandfathered in. They are a nuclear power. They have nuclear weapons. They've tested nuclear weapons. They live between two great enemies that are nuclear powers, bad neighborhood.

DOBBS: Pakistan and China.

ACKERMAN: Pakistan and China, which have nuclear weapons. And India is saying...

DOBBS: But why should we be sending our technology to India without any guarantees whatsoever?

ACKERMAN: No, there are guarantees. That's the whole thing. Under what we have now, which is no protocol, India does whatever it wants. It's a sovereign country...

DOBBS: Right.

ACKERMAN: ... nuclear weapons, nuclear energy. Nobody gets to look at it. Under this deal, what we really get is not the mangoes, but we get a compliance for two-thirds of India's nuclear plants. The IAEA goes in there...

DOBBS: I think it's important for us to explain to everyone here, Congressman, what those two-thirds are. Those are 14 civilian...

ACKERMAN: Correct.

DOBBS: ... plants, not the six military plants...

ACKERMAN: Correct, seven.

DOBBS: and -- OK.

And at this point the estimates are that, by that shift in energy and oversight, which we will not have over the military, nor will any international organization, the judgment is by most critics and those authorities that I happen to believe, that that will provide fuel for 50 additional warheads, weapons, every year.

ACKERMAN: What this deal does is the Indians have to declare their facilities either civilian or military. If they declare them civilian, which they have for two-thirds, they are under complete U.N. safeguards, constant surveillance...

DOBBS: No, I understand.

ACKERMAN: ... We will have the only and a first-time glimpse into the Indian nuclear technology that we have ever had.

DOBBS: Right.

ACKERMAN: The deal is not complete.

DOBBS: But why is that a U.S. interest? Why is that not a United Nations interest, an IAEA interest? And why isn't the proliferation, by the way, the support that India is providing Iran also something that should be of concern to us, as well?

ACKERMAN: well, India is not supplying Iran with anything that's nuclear. That's for sure.

But the U.N. is interested. The rest of the world is interested, and the IAEA is. And everybody's basically...

DOBBS: How is this consistent...

ACKERMAN: .... very, very supportive of this deal because it gives us a foot in the door with India. And what we give to India is technology and wherewithal to help with their civilian nuclear.

Lou, every country that's developing, China, India, name any one you want...

DOBBS: But I happen...

ACKERMAN: ... they're going nuclear. Nuclear energy. Nuclear energy.

DOBBS: Well, it seems to me this country might be thinking in a different direction. Certainly it should be thinking in a direction that makes some sense to all of our relationships around the world, specifically, the Middle East. If you are comfortable with Iran being a nuclear power, you're suggesting...

ACKERMAN: Very, very much against it.

DOBBS: OK. I cannot find any way in which, on the basis of the reasoning that you're putting forward, that we would have a different position toward Iran than we would India.

ACKERMAN: Let me explain it.

DOBBS: OK. We're out of time, Congressman. I mean, we really are.

ACKERMAN: The message is to Iran and North Korea and the other rogue states: that if you want to be treated like India, be like India.

DOBBS: Right.

ACKERMAN: Be a democracy. Don't be an aggressor nation. Open up your facilities for us to inspect, put them under U.N. safeguards and guarantees...

DOBBS: And we'll give you...

ACKERMAN: ... 24 hours a day, and we'll help you with your civilian program.

We're not going to do that with North Korea. We're a long way from that. I'm not talking to that issue because I'm not in favor of it, or with Iran, either. DOBBS: Congressman Ackerman, thank you very much for being here.

ACKERMAN: Thank you.

DOBBS: Thank you for the mangoes.

ACKERMAN: Enjoy.

DOBBS: Thank you.

Coming up shortly here, the "SITUATION ROOM" with Wolf Blitzer -- Wolf.

WOLF BLITZER, CNN ANCHOR: Thanks very much, Lou.

A Republican hawk turns on the president's Iraq strategy, and now he is explaining why he believes the war in Iraq may even be criminal. Senator Gordon Smith, my guest. I'll ask him who should be held accountable.

An international gathering in Tehran questions the existence of the Holocaust. Among those attending, America's own David Duke, formerly of the Ku Klux Klan.

Also, killing Castro. Did a Florida Congresswoman call for his assassination? Or did a British documentary put the words into her mouth?

And "Apocalypto" politics. Mel Gibson, searching for redemption in a box office hit.

All that, Lou, coming up right here in the "SITUATION ROOM".

DOBBS: thank you, Wolf.

Something is missing tonight at the Seattle Tacoma Airport. Where have all those Christmas trees gone? All the Christmas trees had to be taken down because one man objected.

Joshua Levs has the report.

(BEGIN VIDEOTAPE)

JOSHUA LEVS, CNN CORRESPONDENT, CNN NEWSROOM (voice over): Seattle-Tacoma International Airport, Christmas time imagery, but the trees have been taken down. It started with this rabbi's complaint, but this is not what he wanted.

RABBI ELAZAR BOGOMILSKY, HOST, "SHMOOZE RADIO": The Jewish community at-large is offended by the removal of the Christmas trees.

LEVS: What he wanted was for something to be placed alongside one of the trees, a Menorah. He says the Hanukkah symbol, as seen in other public displays, represents triumph of freedom over oppression.

BOGOMILSKY: It's not just a message for Judaism, it's a message of hope for everyone.

LEVS: But he didn't just ask, he threatened a lawsuit. And the commission that oversees the airport says there was not time to reach a resolution.

PATTI DAVIS: Frankly, we are faced with the choice of either spending unknown amounts of the public's dollars and countless hours of litigation, or trying to figure out how to accommodate all these cultures all at once, when we were underway trying to bring half a million people through the SEA-TAC airport, in the busiest possible season.

LEVS: So the trees came down and tempers went up.

UNIDENTIFIED MALE: It's kind of sad that we have to do that now, it seems to try to please everybody.

UNIDENTIFIED FEMALE: To take away the Christmas tree, to me, is just saying Christmas doesn't count, when it's an aspect of Christmas.

LEVS: Airport employees are angry, too.

UNIDENTIFIED MALE: Everybody has been outraged enough they're going to bring in their own solution tomorrow and to demonstrate, I suppose, and bring their own Christmas trees and we're going to display them at the ticket counters.

LEVS: Joshua Levs, CNN, Atlanta.

(END VIDEOTAPE)

DOBBS: Joining me now, our senior legal analyst Jeffrey Toobin.

Jeffrey, the Rabbi Grinch took away those Christmas trees. I mean, this is terrible.

JEFFREY TOOBIN, CNN LEGAL ANALYST: It's just -- it's hard to imagine how everyone could have been more wrong than they were in this situation. First of all, the rabbi had no right to say the Christmas trees should go. The Christmas trees should stay...

DOBBS: Well...

TOOBIN: He didn't say that.

DOBBS: You're right.

TOOBIN: But had he no right to insist on a Menorah because...

DOBBS: A religious symbol.

TOOBIN: Well, it's a religious symbol. But it's not so religious that it can't appear in public. That's -- the courts have regularly said that Christmas trees and menorahs are OK.

DOBBS: But let's talk about where we are in this country right now. Some -- a rabbi walks in and tells SEA-TAC they're going to sue because they're not putting up a Menorah. The fact is there is no reason for the -- for the airport to take down the Christmas tree whatsoever in law, is there?

TOOBIN: Not at all. In fact, the Supreme Court has held since 1984, the famous reindeer rule, that if a symbol of Christmas is mostly secular, like a reindeer or a Christmas tree or Santa Claus, that is not a violation of the separation of church and state, so the rabbi had no right to ask that the Christmas tree be....

DOBBS: It makes you wonder why the Sea-Tac Airport -- it has a general counsel. Why...

TOOBIN: Didn't they know?

DOBBS: ... he or she knows about the doggoned reindeer rule, and why did they cave? And the people in Seattle and Tacoma ought to be furious with this airport.

TOOBIN: Of course, they should. Now ...

DOBBS: And this rabbi ought to be talked to, because he is way over his skis.

TOOBIN: He is. But you know what might be nice, is if the airport said, you know what, we'll put up a Menorah. Lots of communities have both. You don't have to...

DOBBS: But why -- but the point is, its Christmas tree is not a religious symbol. It's a -- it's, in point of fact, become a commercial symbol.

TOOBIN: Exactly. Exactly.

DOBBS: And, you know, the rabbi is messing with hundreds of billions of dollars in revenue for this economy.

TOOBIN: It's -- well, it's a little more responsibility on the rabbi took on, I think, but...

DOBBS: A Jon Stewart would put it, you know, this is a Christmas tree-based economy.

TOOBIN: It is, indeed.

DOBBS: I love having the opportunity to steal from Jon Stewart, anyway.

So people in Seattle, put up your Christmas trees. Tell the rabbi to settle down. Maybe you guys can talk about some other symbols if you want to use them, but at least, you know, enjoy the season.

TOOBIN: Everybody should -- it's a little common sense. Everybody should accommodate each other, you know.

DOBBS: I don't care about that, frankly. Everybody use a little common sense.

TOOBIN: Exactly. But the idea is, everybody can put up their own symbols and nobody fights. That's what the First Amendment is about. It's reducing tensions, not adding to them.

DOBBS: Ah. Are you going to call the rabbi? Or do you want me to?

TOOBIN: You call him, Lou.

DOBBS: Coming up next, two Border Patrol agents facing lengthy jail terms for shooting and injuring a drug dealer. They've won important powerful support, and tonight I am pleased to tell you we'll be joined by two congressmen who are actually doing something about it. Stay with us.

(COMMERCIAL BREAK)

DOBBS: Outrage continues to go over the case of two U.S. Border Patrol agents, Ignacio Ramos and Jose Compean, given harsh sentences for shooting an illegal alien, Mexican drug smuggler. Members of Congress asking President Bush to pardon those two agents. Among those congressmen making that request, Congressman Walter Jones, Republican, North Carolina; Congressman Ted Poe, Republican from Texas.

Gentlemen, thanks for being here. What are the odds that this president is going to do anything, Congressman Poe? Let me start with you.

REP. TED POE (R), TEXAS: I don't know if the president will grant this pardon or not, but it's certainly something that he can be and should do in this particular case.

Our government was on the wrong side. We -- literally the wrong side of the border. More concerned about a drug dealer than we were Border Patrol agents. It sends the wrong message to the Border Patrol. They prosecuted the wrong person. And...

DOBBS: Anything in your experience that suggests what in the heck was this prosecutor and this government, the U.S. Justice Department, thinking here?

POE: I'm not sure what the hidden motives were, but spending so much money in prosecuting this case -- if they spent as much money and time protecting the border as they were prosecuting these two border agents, our borders would be secure right now.

DOBBS: Congressman Jones, what -- are we going to see an investigation?

REP. WALTER JONES (R), NORTH CAROLINA: Yes, sir. I hope so, Lou. And let me say in addition to what Ted Poe just said, I have written, and many of my colleagues joined me, three letters to the president of the United States, four letters to the United States Attorney General Gonzales, one letter to Tony Snow. I have yet to receive a response from the president of the United States to my letter, joined by many of my colleagues.

I would like to say very quickly, I would hope that the people watching this show will call 1-202-456-1111. That is the White House telephone number. And say, Mr. President, for goodness sakes, for goodness sakes, let's give these men the pardon. As Ted said, they have no business being in jail.

DOBBS: Right.

JONES: Or going to jail, excuse me.

DOBBS: Have we got that telephone number up? I'm asking our producers right now for people to call? I'm not getting -- OK. So if we could put that up.

We'll also put it on the Web site. Also, the attorney general's number and also the email addresses for those of you who want to weigh in with the attorney general and the president on this issue.

Gentlemen, we're flat out of time, and I apologize for the brevity of the conversation. I hope you come back soon. We have until, what, January 17th?

POE: That's correct. January 17th.

JONES: The 17th, right.

DOBBS: All right. Well, Congressmen Poe, Congressman Jones...

JONES: Please call. Please call.

DOBBS: ... thank you both for your efforts. And we -- as I say, we'll have those addresses up on the site. Thank you both.

POE: Thank you, Lou.

JONES: Thank you, sir.

DOBBS: Still ahead, the results of our poll tonight. Stay with us.

(COMMERCIAL BREAK)

DOBBS: Our poll: 96 percent of you say congressman who are being investigated for corruption shouldn't hold senior committee positions.

Thanks for being with us tonight. For all of us here, good night from New York. "THE SITUATION ROOM" begins now with Wolf Blitzer -- Wolf.

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