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LOU DOBBS TONIGHT

President Bush to Address Nation on Iraq Wednesday; Democrats Threatening to Withhold Funding for War; Battle Plan

Aired January 8, 2007 - 18:00   ET

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


LOU DOBBS, HOST: Tonight, the White House says President Bush will present his new plan for Iraq Wednesday evening.
We'll have live reports tonight from the White House, Capitol Hill, and the Pentagon.

And a Middle East scholar and former military commander in Iraq join us.

And Democrats were going to save the day on November 7th with a five- day work week in their new Congress. Well, not yet, and not soon. Instead, they took the day off so they could watch a little football.

We'll have that special 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, January 8th.

Live in New York, Lou Dobbs.

DOBBS: Good evening, everybody.

President Bush will address the nation Wednesday evening to announce his new plan for the war in Iraq. President Bush is expected to order at least 20,000 more of our troops to Iraq and spend a billion dollars more on a new jobs program for Iraqis. But the idea of increasing the number of our troops is facing stiff opposition from Democrats and even some Republicans. And supporters of a troop increase are concerned as well that the president's proposals may be inadequate to defeat the insurgency.

Suzanne Malveaux reports from the White House on what president is likely to say Wednesday evening.

Dana Bash reports tonight from Capitol Hill on the Democratic leadership's determination to challenge the president on the issue of the war in Iraq.

And Jamie McIntyre tonight reporting from the Pentagon on whether any troop increase at all will be more successful than previous offenses.

We turn first to Suzanne Malveaux -- Suzanne.

SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT: Well, Lou, today, President Bush hosted a small group of Republicans here at the White House, including Senator Gordon Smith. You may recall Smith shocked his colleagues when last month he went to the Senate floor and said that he was at the end of his rope, he could no longer support the president's Iraq policy, that to continue repeating a failed policy would be absurd or perhaps even criminal.

Well I spoke with him. And he said that the president -- he and the president have put that aside. But now he has fresh new concerns about what the president is calling a new strategy.

(BEGIN VIDEOTAPE)

MALVEAUX (voice over): While sectarian violence threatens to throw Iraq into civil war, President Bush is refining his new plan to fix it. Sources say it's called "A New Way Forward." The president will officially unveil it to the nation in a 25-minute speech at 9:00 Eastern Wednesday night. But sources familiar with the president's deliberations say Mr. Bush and his top advisers know this is going to be a hard sell.

TONY SNOW, WHITE HOUSE PRESS SECRETARY: Some are going to agree. Some are going to disagree. I mean, that's -- that's necessary. But I think if this can be conducted in the spirit of getting it done right, I think it will be constructive for all concerned

MALVEAUX: The most controversial aspect of it, the call for sending at least 20,000 U.S. troops to Iraq, and perhaps other areas in the region. Administration officials have been debating whether to send them in all at once as a big show of force, or phase them in for month to month, depending on whether the Iraqis meet certain military and political goals.

Sources familiar with the deliberation say the phased-in approach seems to be winning the day. But lawmakers attending various meetings at the White House expressed reservations.

REP. GEORGE MILLER (D), CALIFORNIA: Any request for additional troops is going to have to be accompanied by a very, very strong justification and, in fact, a detailed plan as to what would the purpose of that escalation of those troops be.

MALVEAUX: The president is also considering sending some troops to Kuwait as a contingency force, as some Democrats have called for.

The plan also includes a major economic component: an expected billion-dollar new jobs program to get Iraqis back to work, more State Department officials that will head to Iraq to coordinate reconstruction projects for the Iraqi companies.

(END VIDEOTAPE)

MALVEAUX: And Lou, of course following the president's Wednesday address, expect a big sell. President Bush going to Ft. Benning in Georgia, of course, to talk to troops. And then the following day, Secretary Rice, she will take off on Friday. That is, heading to the Middle East and Europe to push this plan forward -- Lou. DOBBS: Suzanne, give us a sense of the White House, at least the staff thinking there, that any Congress, whether Republican or Democrat, should support a new strategy after what will have been almost four years of warfare in Iraq that is by the president's own admission a failure?

MALVEAUX: Well, the thinking here at the White House, administration officials are saying, look, this is the last chance. And this is going to be a long-term effort. But they all acknowledge here, it's going to be a very tough sell.

And this is something, the final push here, to see if this so-called surge is actually going to work while the Iraqis get their own political house in order. But Lou, there are some skeptics, of course, who are saying that they're not necessarily sure this is going to work.

DOBBS: Suzanne, thank you very much.

Suzanne Malveaux from the White House.

Leading congressional Democrats tonight are accusing the president of planning to escalate the war in Iraq. Those Democrats say any troop increases in Iraq would be unacceptable. Many Democrats say they're willing to take tough action to stop any troop increase as well.

Dana Bash reports from Capitol Hill.

(BEGIN VIDEOTAPE)

DANA BASH, CNN CONGRESSIONAL CORRESPONDENT (voice over): Democrats opposed to sending more troops to Iraq are now openly considering using a controversial congressional tool, withholding funding for what they call an escalation of the war.

UNIDENTIFIED MALE: If the president wants more troops, might Congress consider not allowing the funding for that?

SEN. HARRY REID (D-NV), MAJORITY LEADER: We'll take a look at everything.

UNIDENTIFIED MALE: Including that?

REID: We're going to take a look at it, of course.

BASH: That is a significant shift. Until now, cutting off any funding for troops has been the third rail of Iraq war politics. Even Democrats who want the U.S. out of Iraq now have drawn the line at withholding money for the mission for fear it would endanger troops and cause political backlash. But Democrats, now in control of Congress, are under intense pressure to use their new power and the power of the purse to stop the president from sending more troops to Iraq.

SEN. BARACK OBAMA (D), ILLINOIS: My office is now investigating what tools are available to us to condition or constrain appropriations. But what I've also said is that I'm not willing to create a situation in which troops who are already in Iraq might be shortchanged. It creates a difficult situation for Democrats.

BASH: Difficult, indeed. The tension ripping through the new Congress about how to respond to the president's revised Iraq strategy is palpable.

The House speaker was more cautious, but promises the president's plan will be heavily scrutinized in oversight hearings across the Capitol.

REP. NANCY PELOSI (D-CA), HOUSE SPEAKER: Democrats will not cut off funding for our troops. What the president needs to know -- and that's what I was telling him yesterday -- is that congressional oversight is alive and well.

BASH: Republicans who support beefing up forces in Iraq warn Democrats are treading in dangerous territory.

SEN. LINDSEY GRAHAM (R), SOUTH CAROLINA: The stakes are extremely high. Please, Congress, understand what you're proposing when you say cut off funding or capping troops. You're proposing defeat.

(END VIDEOTAPE)

BASH: But Democrats are also considering a resolution, perhaps, capping the number of troops in Iraq, or a symbolic measure that would say that sending more troops to Iraq would be a mistake.

But Lou, on the issue of cutting off funding for an escalation in troops in Iraq, even those who support that, Democrats, that is, say that may be impractical, or at least unconstitutional, because the commander in chief, of course, says military strategy in Congress did approve this war -- Lou.

DOBBS: Thank you very much.

Dana Bash from Capitol Hill.

As elected officials in our nation's capital debate the war in Iraq, insurgents are killing more of our troops. Seven more of our troops were killed over the past four days. Three of them were airmen serving in an explosive ordinance unit. Nine of our troops have been killed so far this month.

3,013 of our troops killed since the war began, 22,714 of our troops wounded. 10,142 of them so seriously, they couldn't return to duty within three days.

Insurgents in Baghdad today killed at least four Iraqis when they attacked a bus on the highway to Baghdad International Airport. Nine Iraqis were wounded. The highway one of Iraq's most heavily guarded and attacked roads.

Military officials are confident their new plan to win the battle for Baghdad will succeed. Those officials say they've learned some hard lessons from the previous unsuccessful offensives to secure Baghdad. Leading amongst those offenses, Operation Together Forward.

Jamie McIntyre reports from the Pentagon.

(BEGIN VIDEOTAPE)

JAMIE MCINTYRE, CNN SR. PENTAGON CORRESPONDENT (voice over): Operation Together Forward, the joint U.S.-Iraqi plan to take back Baghdad, was highly touted when it was announced last summer. But within just a few months, it was an acknowledged failure.

MAJ. GEN. WILLIAM CALDWELL, SPOKESMAN, MULTINATIONAL FORCE, IRAQ: Operation Together Forward has made a difference in the focus areas but has not met our overall expectations of sustaining a reduction in the levels of violence.

MCINTYRE: Despite committing close to 10,000 additional U.S. troops, including a Stryker brigade moved to Baghdad instead of being sent home, violence in the Iraqi capital only got worse. In retrospect, U.S. commanders concede the flaws in the Together Forward plan were glaringly obvious: too few Iraqi troops to keep the peace after U.S. forces did the heavy lifting, and too much focus on the Sunni insurgents while ignoring Shia death squads.

The top ground commander in Iraq, Lieutenant General Ray Odierno, told reporters in Baghdad, "We overestimated the availability of Iraqi security forces initially. So we were able to clear areas, but we were not able to hold the areas."

Odierno says this time the U.S. will have a more balanced approach, going after both Sunni and Shia extremists. And U.S. troops will stay to protect the people.

Frederick Kagan is one of the outside advisers President Bush is listening to.

FREDERICK KAGAN, AMERICAN ENTERPRISE INST.: We're talking about a longer-term operation where we stay in the neighborhoods that we've cleared, partnered with Iraqi units. It's a very different concept from what went on in Together Forward.

MCINTYRE: Pentagon sources say the Army is participating in initial increase or plus-up, as the Pentagon is calling it, of three brigades, roughly 10,000 soldiers, including, perhaps, a brigade of the 82nd Airborne Division, which has just arrived in Kuwait. In addition, sources say, a Marine regiment will likely have its tour extended in neighboring Anbar province, while another fresh regiment is sent in, adding about 4,000 troops there. Two additional Army brigades would be held in reserve either in Kuwait or in the U.S.

(END VIDEOTAPE)

MCINTYRE: Pentagon sources say the additional troops could begin moving into Baghdad within a week of President Bush's announcement Wednesday night. But what no one can say is when those troops might start to come home -- Lou. DOBBS: No. And even when they do say when those troops are likely to come home, they're always wrong, as you have reported here over the last three and almost four years now about the continual extensions.

Jamie, I have to ask you, at this point, why should any American citizen have any more faith in the espousals of a Frederick Kagan or any other senior military admitting that they are only now coming to terms with the reality that it would be helpful to the cause to create jobs, to bolster the economy, and to better the lives of Iraqis? I mean, that's palpable nonsense that it would be discussed now rather than anytime over the previous three years.

MCINTYRE: Well, you know, it has been discussed over the previous years, and there have been programs to try to do that.

DOBBS: Right.

MCINTYRE: They just -- they haven't worked.

DOBBS: Right.

MCINTYRE: And what they've done is tried to analyze why it hasn't worked. It really comes down to two options, though. You either throw in the towel or give it one last shot. And what we're seeing here is one last shot.

And the question is, how long will that last? Pentagon sources tell me that they're talking about at least six months.

Folks like Mr. Kagan suggest it's going to have to be at least 18 months. And even General Odierno told reporters yesterday that he thought the U.S. would have to be there for several more years.

So that's what we're looking at.

DOBBS: That's what we're hearing. What we're looking at is what is now a four-year-long conflict in which the president of the United States acknowledges it is one that we are neither winning nor losing.

Jamie, thank you very much.

Jamie McIntyre from the Pentagon.

Still ahead here, Governor Arnold Schwarzenegger proposes new benefits for illegal aliens in his state, subsidized by taxpayers, of course.

We'll have that report.

And new questions about why National Guard troops on our border with Mexico withdrew when confronted by gunmen who had crossed the border from Mexico.

And why in the world are Democrats not working that five-day week they promised back in November? It's got something to do with football and other critical national issues.

Stay with us.

(COMMERCIAL BREAK)

DOBBS: Just three days after calling for a new era of post- partisanship in California politics, Governor Schwarzenegger has angered members of his own party and the public, proposing new benefits for illegal aliens. The governor proposing mandatory state subsidized state health insurance for all state residents.

Peter Viles reports.

(BEGIN VIDEOTAPE)

PETER VILES, CNN CORRESPONDENT (voice over): California Governor Arnold Schwarzenegger is proposing that everyone in his state, including those here illegally, be required to purchase health insurance.

GOV. ARNOLD SCHWARZENEGGER (R), CALIFORNIA: If you can't afford it, the state will help you buy it, but you must be insured.

VILES: He argues that since the state is obligated to pay for emergency room treatment for illegal aliens, it makes financial sense to force them to buy subsidized health insurance.

SCHWARZENEGGER: Our question, the decisions that our team has made, was not should we treat them or not treat them. The question really is, how can we treat them in the most cost-effective way? We are trying to be realistic here and not live in denial.

VILES: Republicans immediately criticized the governor's plan, saying it would attract and reward illegal aliens.

MICHAEL VILLINES, CALIF. STATE ASSEMBLY: If they break the law coming into our country, they will get benefits that they wouldn't receive if they played by the rules. And that kind of message is a very dangerous message for a nation that supposedly believes in the rule of law to send anywhere around the world, especially in our own neighborhoods.

UNIDENTIFIED MALE: This would be a further validation of saying illegal behavior is OK, and I don't think that's where Californians want to go. Californians have been very clear about that.

VILES: Schwarzenegger estimates the cost of subsidizing insurance for illegal aliens at roughly $2.5 billion a year. California already spends heavily on healthcare for illegals.

In 2004, an estimated 43 percent of all births covered by the state's Medi-Cal program were to illegal aliens. The cost of those 105,000 deliveries was $400 million.

(END VIDEOTAPE)

VILES: And Lou, this is a national problem, to be sure. At Parkland Hospital in Dallas, Texas, the hospital where President Kennedy died, it's now estimated 75 percent of the babies born at that hospital are born to illegal aliens -- Lou.

DOBBS: Seventy-five percent.

VILES: And this is one of the biggest maternity wards in the United States, 16,000 babies born there every year, 12,000 of them born to illegals.

DOBBS: Now, correct me if I'm wrong in this, Pete, but the very generous Governor Schwarzenegger, who now describes himself something as a centrist, even as he proposes something this radical, which is -- you've got to love about California and really American politics -- 43 percent of Medicaid is going to -- say that again -- in California.

VILES: Forty-three percent of the births in this state that are subsidized by the state's health program, 43 percent are to illegal aliens. And that number has been growing a little bit in the past couple of years.

DOBBS: It's remarkable. The reaction to this, I suppose, I think it's fair to say, is only beginning to set in.

Peter Viles, thank you very much, reporting from Los Angeles.

That brings us to the subject of our poll tonight. Do you believe the United States should provide taxpayer-funded healthcare to illegal aliens? Yes or no?

Please cast your vote at loudobbs.com. We'll have the results here upcoming.

Toys 'r' Us tonight says it will give a $25,000 prize to the parents of a newborn baby. The prize, part of the store's new year baby contest.

Now, originally, Toys 'r' Us said it would not give the mother the prize because she is an illegal alien from China. A firestorm of criticism apparently erupted from Chinese illegal immigrant groups and some elected officials in New York who support those illegal immigrant groups, and Toys 'r' Us has reversed its decision.

An estimated 300,000 babies are born to illegal aliens in this country each and every year. And as you just heard Peter Viles report from California, at no small expense to taxpayers.

A Dallas-based pizza chain has decided that the U.S. dollar is no longer the only currency it will accept at its stores. In Texas, starting today, Pizza Patron customers will pay for their pizza in pesos.

Pesos at Pizza Patron. It's got a ring to it.

A spokesman for Pizza Patron told us the company caters to the Hispanic community and many of their customers visit Mexico, frequently, they say. And they have a few extra pesos in their pockets. So this is the way to serve those customers who frequent Mexico and keep a few pesos. The company's trying out the peso plan. If I get one more "P" into this, I will have to apologize for another two months. The chain operates in Texas, Arizona, California, Colorado and Nevada. And if we spent much time, we could think about what all of those states have in common.

Thousands of Mexican federal troops tonight are in Tijuana. They're there to crack down on violent drug gang violence.

The forces were ordered to Tijuana by Mexico's new president, Felipe Calderon. The drug gangs operated in and around Tijuana, smuggling illegal drugs into the United States, responsible for much of the violence in the border region.

Casey Wian has our report.

(BEGIN VIDEOTAPE)

CASEY WIAN, CNN CORRESPONDENT (voice over): Mexican federal troops confiscating the weapons of 2,300 Tijuana police officers. Many suspected of connections to Mexican drug cartels. The crackdown by more than 3,000 Mexican soldiers as new president Felipe Calderon's effort to seize control of large parts of Mexico from ruthless drug traffickers.

GEORGE GRAYSON, COLLEGE OF WILLIAM & MARY: Calderon is saying emphatically that there's a new sheriff in town. On the watch of his predecessor, Vicente Fox, there was a little or no concerted effort against the drug cartels. And as a result, you had any number of cities where there was virtually co-sovereignty

WIAN: The calderon crackdown began last month in his home state of Michoacan. Nine bodies were discovered over the weekend, bound and gagged, apparent victims of drug cartels.

Near Tijuana, major highway were packed as soldiers searched for weapons and drugs. Published reports from Mexico say drug trafficking activity in the area came to a virtual standstill this weekend.

A spokesman for the U.S. Border Patrol says agents are monitoring the situation. But he says it's too early to tell if Operation Tijuana has reduced the flow of drugs across the U.S. border.

Tijuana is a major American tourist destination. The U.S. State Department in September alerterted Americans to the threat of drug violence in Tijuana and elsewhere in Mexico, but is noncommittal about updating that alert.

SEAN MCCORMACK, STATE DEPT. SPOKESMAN: They take a look at it with an objective eye as to the situation on the ground. And if we need to issue something (ph), we will.

WIAN: After walking off the job for a day, Tijuana police are back on patrol unarmed, responding only to nonviolent incidents. Federal troops are expected to remain in control for at least three weeks while investigators check Tijuana police weapons for links to drug violence.

(END VIDEOTAPE)

WIAN: That show of force is in sharp contrast to the U.S. military presence on the border, where, of course, last week National Guard troops retreated when they saw four armed men advancing from Mexico -- Lou.

DOBBS: That's still incredible. President Bush making much of sending 6,000 National Guardsmen to the border. It turns out he didn't sent them to the border. He sent them near the border.

Some of them got near the border, I suppose, near enough to call it on the border. But the idea of the United States National Guard retreating from this nation's borders tells you more than almost any other snapshot of an event could.

WIAN: And the Border Patrol says that those National Guard members acted just like they were supposed to act. That they're only allowed to raise their weapons and fire if they feel that their lives are directly in danger.

They're not allowed to apprehend anyone, no matter whether they be illegal aliens, drug smugglers armed, whoever they may see. They're supposed to retreat and wait for the Border Patrol to come in and help them out. This time the bad guys got away -- Lou.

DOBBS: If it were only this time, it would be nice, but as you and I both know, that is the more likely result than the exception.

WIAN: Right.

DOBBS: Casey, thank you very much.

Casey Wian.

Well, more validation tonight on something that we have been reporting here for years. A new report from the Justice Department says illegal aliens who are arrested are more than likely to be arrested again and again and again.

This report shows that some illegal aliens, in fact, are arrested as many as six times. The federal government study of 100 illegal aliens arrested in 2004 revealing that 73 of those were arrested and then released over and over again. In fact, 429 times for a variety of crimes.

Coming up next, a new free trade zone. A plan that threatens American jobs and our sovereignty, but it turn out it's precisely what President Bush's father had in mind when he put forward that vision thing.

We'll have that special report.

And a hundred hours, an ambitious agenda for Democrats. But first, they need to prepare. They're taking a day off today. We'll tell you why.

And just what was that gas-like odor that ripped Manhattan this morning? A mysterious malodorous odor. We will have the details coming up here next.

Stay with us.

(COMMERCIAL BREAK)

DOBBS: Tonight, a proposal for an expanded so-called free trade zone from Alaska to the tip of South America. It's a plan from the business elites, the political elites, that will cost more American jobs, cost more American sovereignty, but it would fulfill the president's father's vision.

Bill Tucker reports.

(BEGIN VIDEOTAPE)

BILL TUCKER, CNN CORRESPONDENT (voice over): It's not a new idea. President Bush talked about it back in 1991.

GEORGE HERBERT WALKER BUSH, FMR. PRESIDENT OF THE UNITED STATES: It is a big idea, a new world order, where diverse nations are drawn together in common cause.

TUCKER: Now former United States trade investor Robert Zoellick is talking about it again with renewed vigor. This time, a new world order with business at the helm of trade and economic policy. Advocating what he calls the Association of American Free Trade Agreements, a separate nongovernment entity which would include North, Central, and South America.

ROBERT SCOTT. ECONOMIC POLICY INST.: What Zoellick is really proposing here is a stealth trade agenda. It's not a national agenda. He's proposing to set up what is essentially a private organization to try to achieve what he couldn't get done when he was the U.S. trade representative. And this is a business agenda.

TUCKER: It's an agenda that goes hand in hand with the United States, Mexico, and Canada, working quietly and behind the scenes to promote a common market with common deregulation for the benefit of multinational corporations. It's an agenda that so far has resulted in an increase in U.S. corporate profits of 45 percent, while wages of American workers have risen only 3 percent in the last five years.

ALAN TONELSON, U.S. BUSINESS & INDUSTRY COUNCIL: The main danger raised by Zelic's (ph) proposal is that the future of American international economic policy, which affects not only our nation's prosperity but its national security, will be set not by the American people and their elected representatives, but by a small corporate elite is that accountable to no one but itself.

TUCKER: Effectively surrendering the sovereignty of the United States.

(END VIDEOTAPE)

TUCKER (on camera): And as justification for trusting those who would have the authority? The argument is made that free trade promotes democracy and the welfare of the people.

But, Lou, one has to look further than China to see whether that, in fact, is true.

DOBBS: You know, talking about Zelic's proposal, it's not Zelic's proposal. It's daddy's proposal. And people better understand that they mean exactly what they're saying. It's a new world order they're trying to create. And they're trying to do so not only without approval or consent of the governing of this country, but despite the popular will. This is a straightforward assault by the elitists in this country.

And I appreciate it, Bill. Thanks very much.

Bill Tucker.

Let's take a look at some of your thoughts now.

J.M. in Texas and said, "Please explain again a citizen's voice in government. Apparently, if I were an illegal alien in need of Social security benefits I could have a voice. Possibly I could get more answers if I were a Mexican drug smuggler with a much deserved bullet in my posterior."

And Scott in Michigan: "Dear Lou, do you have the address to the Bush Ranch in Crawford, Texas? My friends and I want to send directions to the Mexican nationals. They need to know he has work waiting for them, but if he's not there to just go in and help themselves."

Dwight in South Carolina: "If government workers (city, county, state and federal) were being displaced or their salaries affected by the illegal immigrants, the problem of illegal immigration would disappear quickly."

Send us your thoughts to loudobbs.com. We'll have more of your thoughts coming up here later. Each of you whose e-mail is read here receives a copy of my book, "War on the Middle Class".

Up next, officials in the metropolitan and New York area are still trying to figure out the source a foul smell that engulfed the city and parts of New Jersey this morning. We'll have the latest on this mystery.

And two of the country's most distinguished authorities on the war in Iraq join me to discuss what should be in the president's plan.

And House Democrats have called a time-out before the first 100 hours even begins. And the reason is straightforward. It's a very American reason, but also a little laughable.

Stay with us. (COMMERCIAL BREAK)

DOBBS: Our top stories tonight: the president will announce his new strategy in Iraq in a speech to the nation Wednesday evening. Senator Gordon Smith, who met the president today, says the president will call for another 20,000 troops in Iraq.

The Democratic leadership in Congress says the president is trying to escalate the war. They say that's simply unacceptable. Some Democrats are considering withholding funds to pay for the war.

Governor Schwarzenegger in California, he wants more benefits for illegal aliens subsidized by taxpayers in his state. Governor Schwarzenegger wants all state residents, including illegal aliens, to buy state subsidized health insurance.

Another troubling security incident at the Port of Miami today. A bomb squad exploded a suspicious device that was about to be loaded onto a cruise ship. The Coast Guard says the package was tested six times. Each time it came back positive for C-4 plastic explosives. The officials say the package contained sprinkler parts, which contain a substance that closely resembles plastic explosives.

Today's incident is just a day after another terrorism scare at the port, three men trying to drive a truck past without proper documents. The bomb squad cleared the truck. The scare reportedly stemmed from miscommunication. The men, of Middle Eastern dissent, all in the country legally, however. Charges against them were dropped.

Officials, still trying to find the cause a mystery smell that spread across of much of Manhattan and parts of New Jersey today. At least seven people were hospitalized complaining of symptoms such as shortness of breath. Some schools and stores were even evacuated. Some train services suspended for a while. Emergency crews found nothing dangerous in the air. One theory is that it could have been a leak of a chemical that's used to give natural gas an aroma, smelling a bit like sulfur, which is what a lot of people were smelling, they say, during their morning commute and arrival at their offices. The bottom line is, nobody in Manhattan knows what happened or why.

Austin, Texas has a mystery of its own tonight. Police shut down ten blocks of downtown Austin for a time, after dozens of birds were found dead in the streets. Again, officials found no sign of dangerous chemicals in the air. No people were affected. Hazmat teams picked up the dead birds. They're being examined for signs of poison or viral agents. Officials don't believe the bird flu is involved. But, again, they don't know what caused the problem.

The new Congress has a lot of work to do. It promised to push through major legislation in its first 100 hours. National security, minimum wage, stem research: all issues the Democratic majority in the House wants to tackle right away. So what did they do in all of that enthusiasm? Well, they took this day off.

Lisa Sylvester reports. (BEGIN VIDEOTAPE)

LISA SYLVESTER, CNN CORRESPONDENT (voice-over): It's Monday, and do you know where your House lawmakers are? Most are not in Washington. They had the day off. That's despite a brand-new pledge by the Democratic leadership to work a five-day work week.

GARY RUSKIN, CONG. ACCOUNTABILITY PROJECT: Where are they? You know, for $165,200 a year plus a list of perks a train length long, we expect them to work a five-day week. And where are they?

SYLVESTER: Here's a clue: some are kicking off the congressional season in Arizona, watching Monday night's college football championship game between Ohio State and the University of Florida. House Majority Leader Steny Hoyer granted a request by Ohio Representative John Boehner to cancel House business on Monday so they could go to the game.

Here's Hoyer talking about it on the floor on Friday.

REP. STENY HOYER, (D) MARYLAND: In the spirit of comity, I know if Maryland were playing, I would want to be accommodated. And I wanted to accommodate my friend, Mr. Boehner. So we've don that.

SYLVESTER: House Democrats explain it this way: they've reset the start clock, saying they didn't really intend to start official business until after Monday.

REP. NANCY PELOSI, (D-CA) SPEAKER OF THE HOUSE: One hundred hours will begin tomorrow so that we could have given three-day layover as we promised we would, so that everyone would have a chance to see the bills.

SYLVESTER: Last Congress was pegged the "Do-Nothing Congress" for its short work week and empty promises. Hopefully, this Congress is not working off the same play books.

(END VIDEOTAPE)

SYLVESTER (on camera): And prior Congresses were actually a lot worse. They were sworn in and then immediately took off the next two weeks.

By the way, Lou, the House did not make it into work today. But the Senate was there, working from 11:30 and breaking just before 5:30 -- Lou.

DOBBS: Well, good for them. A robust, just about six hours of work, impressive.

SYLVESTER: It must be nice.

DOBBS: Amazing.

Thank you very much.

Lisa Sylvester from Washington.

Now we know the clock will start tomorrow, when the House takes up its first legislation. The clock will only run when legislation is actually being debated and voted upon, not during procedural matters or general speechmaking, which will eliminate a lot of hours. We'll be watching the clock. We'll keep a running tab on what Congress can actually do in 100 hours. Stay with us.

Coming up next, two of the leading authorities on the war in Iraq say a troop surge is just unthinkable.

And your Social Security dollars could be going to Mexican nationals who work here illegally. But it gets even better if you happen to live in California. Stay with us for that story as well and a great deal more.

(COMMERCIAL BREAK)

DOBBS: Joining me now, two of the country's most diminished authorities on the war in Iraq and the Middle East. Colonel Thomas Hammes served in Iraq with the U.S. Marine Corps, setting up bases for the new Iraqi army. Vali Nasr, professor of Middle East and South Asia politics at Naval Postgraduate School. Good to have you with us.

Let's start right out. A surge. That is the term of art now -- not reinforcements, not raising the number of troops, a surge. What's your reaction, Colonel?

COL. THOMAS HAMMES, U.S. MARINE CORPS (RET): 20,000 troops for a period of time is more a dribble than a surge. We've already sent 20,000 into Baghdad before. We've tried this. Unless it's tied to some coherent political strategy, 20,000 troops is insufficient. It just won't accomplish anything.

DOBBS: All right, Colonel Hammes is a war fighter. You have a more scholarly and academic viewpoint. What is -- where would you depart from the colonel's view?

VALI NASR, NAVAL POSTGRADUATE SCHOOL: I think he's generally right. What Iraq needs is not more troops. What it needs is a political plan. A year ago, we talked about national unity government and reconciliation. We've gone a year, nothing's happened. And the troops would be useful if they were to support a political plan.

Iraq is in a situation of chaos and violence because it does not have a political settlement. What it needs first and foremost is a road map for peace between these factions. And I have not yet seen that on the table as part of this new package.

DOBBS: And, at the same time, there is every indication that this administration wants to spend another $1 billion to create jobs. That there is suddenly this view that they've got to reintroduce the idea of hearts and minds. Does it strike you as just dumbfounding that this administration is talking about these issues almost four years into this war, and has not succeeded in any one of these areas? NASR: I think the jobs, then, hearts and minds are always important. But that's not what Iraq right now needs. Iraq needs a political settlement. That's the best way of winning hearts and minds.

And also there is a danger. When you send in 20,000 troops and you want to take on new mission of going after Shia militias, you may end up with a bigger insurgency than the one you have now. The Shia militias may be terrible in terms of what they're doing, but they're not attacking Americans. And if we end up provoking a Shia insurgency in southern Iraq, we're going to be having many more surges on top of this one.

DOBBS: Colonel, the idea of 20,000 troops, creating jobs, all of this, four years later, is there such a thing as saying four years is enough? You have, speaking of this administration and these general staff officers, you have had four years to succeed, and you have failed. Why in the world should we believe you're any smarter today than you were four years ago?

HAMMES: Well, he's changed a lot of the personnel in the process, and that's an important first step. But we've also got to have a serious discussion -- 20,000 will not bring success -- an honest discussion of the hundreds of thousands that General Shinseki said it would take in the first place.

A true surge would be 150,000 additional troops, 300,000, sustain them for four years. That requires a massive increase in size of the Army and the Marine Corps.

If this is truly the most important event of our generation, then we should treat as such. So far, the administration's not been serious about this war.

DOBBS: Not serious about this war -- 22,000 wounded, more than 3,000 killed. At what point?

HAMMES: The Army and the Marine Corps have been serious. The administration -- we're still years into this -- we're years into it, we have not changed our personnel policies. We haven't changed our procurement policies. And we don't have a viable political plan. That's what a serious administration does together, is bring a coherent plan together.

DOBBS: All right, the Democrats say that they want to not fund this. I don't think that that's frankly political possible, nor do I think it's morally correct that they would withdraw funding from our troops there.

But at the same time, there has to be a result here. What is the most intelligent result with -- allowing us to achieve whatever objectives we can? And at the same time save as many American and Iraqi lives as possible?

NASR: I think what the Democrats should do is either ask the administration themselves, take the initiative to put forward a political plan, a road map for a political settlement in Iraq, that would allow the United States to gradually extricate itself from Iraq. And you're not going to have security and peace in Iraq until the various warring parties have a settlement they can live with. And we don't have a road map for that, and that is not part of the discussion at all. Neither the Republicans, nor the Democrats, nor the critics, nor those who support the administration, none of them have put on the table the notion of what it is to get peace to these warring sides. Putting benchmarks on a policy that already has not worked is not a substitute for a road map.

DOBBS: Let's go to what has transpired here. Abizaid is out. Casey is on his way to be chief of staff of the Army. You have Fallon, Admiral Fallon moving in. Negroponte is taking the number two job at the State Department after giving up the number one job in intelligence. What sense does this make to you?

HAMMES: I'm certainly not qualified to comment on the personnel moves. The key point is, if you don't provide enough resources, it doesn't matter who the personnel are. You have to get serious about this.

DOBBS: Are we giving our troops enough resources right now?

HAMMES: No, we're not. There are insufficient numbers of troops. Four years in, we're still using the same poor-quality armored vehicles we went in with at the beginning. We have American companies prepared to make better armored vehicles. We have American repair depots that are working part-time when the troops need equipment. All we have to do is tell them to work full-time.

DOBBS: And Professor, let me turn to you, the same issue. We have changed, for the first time, we have seen a substantial change in the assignments of top people, the general staff. Is it adequate? And will their replacements be any more capable?

NASR: Well, the people who are going to be on the ground are the ones who pass information to Washington about the reality on the ground, and then execute what the policy in Washington is. And to that extent, maybe new people are better.

But this is the point at which, when the president is announcing a new strategy, that he has to put forward a new plan for Iraq. We have to admit that what we started in January 2006 with a national unity government and reconciliation has failed. It's time to call a spade a spade and come up with a new plan, and then these people could implement it.

DOBBS: And you would think it would be time to equip and provide sufficient resources and materiel for our troops, almost four years in, right, Colonel?

HAMMES: Way past time.

DOBBS: Colonel Hammes, thank you very much. Professor Nasr, thank you very much. Gentlemen.

Coming up at the top of the hour, "THE SITUATION ROOM" with Wolf Blitzer. Wolf, tell us about it.

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

We're following a developing story right now. There are some shocking new pictures of Saddam Hussein after his execution. They're surfacing right now on the Internet, and it's adding new fuel to the fiery controversy over his hanging. This is what United States does not need right now.

Also, President Bush's poised to order thousands more troops to Iraq. But what do forces already on the ground think of the idea? CNN's Arwa Damon is embedded with U.S. military forces on the ground. We're going to get their reaction.

And Senator John McCain. He's been calling for more troops for some time. It's not a widely popular idea. So how will it impact his presidential hopes?

Plus, we're going to have details of the stem cell discovery that could turn around the entire debate. We'll show you what researchers say they've discovered.

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

DOBBS: Thank you, Wolf.

Just ahead here, our guests on an outrageous plan to allow Mexican nationals who've worked in the United States illegally after a year and a half to collect full Social Security benefits. The Bush administration with another interesting idea. Stay with us.

(COMMERCIAL BREAK)

DOBBS: In 2004, President Bush struck a deal with President Fox of Mexico that could jeopardize your Social Security. A deal would allow illegal aliens, granted amnesty to claim credit for time they worked here illegally. We might not have even known details of this deal if it weren't from our guests tonight. Shannon Benton is executive director of the Trea Senior Citizens League. Shannon, good to have you here.

SHANNON BENTON, TREA SR. CITIZENS LEAGUE: Thank you, Lou. It's good to be here.

DOBBS: And the Trea is the retired enlisted association and you had to file a freedom of information to get this.

BENTON: We did. About three and a half years ago, we filed a freedom of information act request through regular channels. When documents were not forthcoming, we did go forward and file a lawsuit against a Social Security Administration and the U.S. State Department to gain access to these documents.

DOBBS: And the basic plan is to give, after a year and a half, full benefits -- Social Security benefits to illegal aliens?

BENTON: Yes, 18 months, whereas U.S. citizens normally have to work 40 quarters or 10 years.

DOBBS: And let's go to another part of this issue. I mean every citizen has to be outraged at this because particularly, as the General Accountability Office points out, they don't even know -- first of all, no one has an exact count on the number of illegal aliens, Mexican nationals in this country at all, so they can't make an intelligent estimate on the cost, can they.

BENTON: No, they can't make an intelligent estimate on the cost and they also asked the Social Security actuaries to reissue a report with what would be better estimates. And to the best of our knowledge, that report has not been forthcoming.

DOBBS: How do you respond to the charge that this administration would allow individuals who've broken a U.S. law to enjoy the benefits of Social Security like this?

BENTON: Well, we don't want to speculate on what thoughts were behind the totalization agreement in the first place. What we are hoping is that legislation will be passed that will force all totalization agreements to go before Congress. And that they have to be approved, not simply rejected.

DOBBS: And they're actually two proposals to do exactly that. This becomes law, correct?

BENTON: Yes.

DOBBS: All they have to do -- unless senator, it's Senator Ensign?

BENTON: Senator Ensign recently introduced a bill that would require these bills be approved before Congress.

DOBBS: And in the House?

BENTON: And in the House, it was Congressman Cubin.

DOBBS: We just want to give them credit. The idea that these -- these son of a guns -- I mean the temerity of this thing, trying to sneak this by. What do you think of a government, an administration that would try to sneak this through and resist the public's right to know on this agreement?

BENTON: Well, it frustrated us and it frustrated us to the point where we did have to file a lawsuit just to get access to the documents.

DOBBS: Shannon, I want to say to you that you are a much nicer person than me, because it does more than frustrate me. It is outrageous that citizens would have to file freedom of information to get this kind of information about the conduct of their government.

And I think it's absolutely utterly and completely in my opinion, to be absolutely clear, it's utterly despicable. I thank you for your courage, and persistence and for getting this information for the benefit of all of us.

BENTON: Well, thank you, Lou.

DOBBS: Thank you very much, Shannon Benton.

Still ahead here, the results of tonight's poll. More of your thoughts, please stay with us.

(COMMERCIAL BREAK)

DOBBS: The results of our poll tonight, 97 percent of you say the United States should not be providing taxpayer-funded headgates to illegal aliens as Governor Schwarzenegger of California is now proposing.

Time to look at a few more of your thoughts.

Forest in Texas said: "Why are members of Congress that have been convicted of felonies permitted to receive pensions? I received a retirement pension for service performed in the army. If I had been convinced of a felony while in the army, I would have been discharged, send to prison and given up military rank and all of that forfeited as well, pay and allowances."

Darrell in Georgia: "Lou, maybe when these armed illegals confront the National Guard, the Guard could just ask them if they also want a social security card and a driver's license before we allow them to pass through the border."

And Winston in Tennessee: "Lou, with respect, I disagree with your opinion that those National Guardsmen were not in danger. I am confidence those Guardsmen were well aware of the danger of being prosecuted by the Justice Department."

Send us your thoughts at LouDobbs.com. We appreciate hearing from you. Thanks for being with us tonight. Please join us here tomorrow. For all of us, thanks for watching. Good night from New York and "THE SITUATION ROOM" with Wolf Blitzer begins right now.

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