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Lou Dobbs Tonight

Divine Political Agenda?; Attorney General Gonzales Contradicted By Former Aide on Capitol Hill; Mexican Trucks on U.S. Roads: Security Threat?

Aired March 29, 2007 - 20:00   ET

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


LOU DOBBS, CNN ANCHOR: Tonight: new questions about whether Attorney General Alberto Gonzales is telling the truth or lying in the storm over those fired U.S. attorneys. The former top aide to the attorney general today testifying before Congress and contradicting his former boss.
The Senate defies President Bush and sets up a showdown with the White House over the withdrawal of our troops from Iraq.

And the standoff between our strongest ally and Iran is intensifying tonight. Fifteen British sailors and marines mark day six as hostages -- those stories and much more coming up next.

ANNOUNCER: This is a special edition of "LOU DOBBS TONIGHT," news, debate and opinion for Thursday, March 29.

Live from Washington, Lou Dobbs.

DOBBS: Good evening, everybody.

Tonight, the former chief of staff to Attorney General Alberto Gonzales contradicted his ex-boss. And he says Alberto Gonzales was involved in the decision to fire those U.S. attorneys.

The Senate passed a $123 billion war spending bill and, with it, a deadline for bringing our troops home from Iraq. President Bush, he says he stands by his veto threat of that legislation.

Kelli Arena tonight reports on what the attorney general has said and the contradictions in Kyle Sampson's testimony.

Ed Henry reports tonight on President Bush's defiant words, after the Senate votes to bring our troops home by next March.

Barbara Starr reports on the standoff between Iraq and Britain and Tehran's new accusation against the British sailors and marines captured by the Iranians six days ago.

We begin tonight with Kelli Arena -- Kelli.

KELLI ARENA, CNN JUSTICE CORRESPONDENT: Lou, Kyle Sampson never veered from his insistence that the firing of those U.S. attorney generals was not improper. But it's one of the only things that he and the attorney general agree on.

(BEGIN VIDEOTAPE)

ARENA (voice-over): Kyle Sampson didn't fall on his sword; he swung it.

Attorney General Alberto Gonzales' ex-chief of staff told a hostile Congress that his old boss was wrong to claim he wasn't involved in discussions about the fired U.S. attorneys. In fact, Sampson said he talked it over with Gonzales from the get-go, in early 2005.

KYLE SAMPSON, FORMER CHIEF OF STAFF TO ATTORNEY GENERAL ALBERTO GONZALES: He and I had discussions about it during the thinking phase of the process. Then, after the sort of more final phase of the process, in the fall of 2006, began, we discussed it.

ARENA: Keep an eye on the timeline here. Sampson says that Gonzales was involved in discussions about the firings back in 2005, when he was still White House counsel.

But here's what Gonzales said about his role just two weeks ago.

ALBERTO GONZALES, ATTORNEY GENERAL OF THE UNITED STATES: Was not involved in seeing any memos, was not involved in any discussions about what was going on.

ARENA: Addressing those contradictions, Justice officials said in a statement, the attorney general -- quote -- "was kept aware of some conversations during the process."

But even that is a far cry from what his former chief of staff said today.

SAMPSON: We had talked over the course of a couple of years about the strengths and weaknesses of U.S. attorneys.

ARENA: Senators smelled a rat, or at least an attempt by the embattled attorney general to put more distance between himself and the firings than actually existed.

SEN. CHARLES SCHUMER (D), NEW YORK: The credibility of the attorney general on this issue has been, more or less, shattered by what happened -- what happened in that hearing room.

ARENA: More shattering still, Sampson admitted, under pressure, that he regrets putting New Mexico U.S. attorney general David Iglesias on the hit list.

SAMPSON: In hindsight, sitting here today.

SCHUMER: Correct.

SAMPSON: I don't -- I would not.

(END VIDEOTAPE)

ARENA: Senators can't wait to get their hands on Gonzales, who's scheduled to testify on April 17.

And, Lou, as one lawmaker put it, they will finally get to deal with him eyeball to eyeball.

DOBBS: Kelli, thank you very much -- Kelli Arena.

One man who has not been heard from yet is White House adviser Karl Rove. The Democrats want to question Rove to see what role, if any, he may have played in the firing of the eight U.S. attorneys.

Brian Todd has that part of the story.

(BEGIN VIDEOTAPE)

BRIAN TODD, CNN CORRESPONDENT (voice-over): He joked about the U.S. attorney story the night before.

UNIDENTIFIED MALE: We just want to ask you some questions about -- we -- we...

KARL ROVE, SENIOR ADVISER TO PRESIDENT BUSH: Lots of people want to ask me questions.

(LAUGHTER)

TODD: Hours later, Senate Democrats, clearly frustrated they couldn't question Karl Rove, grilled former Justice official Kyle Sampson about him, zeroing in on e-mails, meetings, trying to discover whether Rove's fingerprints were on the firings of eight U.S. attorneys.

Sampson is asked, did he collaborate with Rove to get former Rove aide Tim Griffin appointed to one of those posts?

SAMPSON: I don't remember Karl Rove ever talking to me in person or on the phone. I don't remember anyone telling me that Mr. Rove was interested in Mr. Griffin being appointed.

SEN. EDWARD KENNEDY (D), MASSACHUSETTS: Then, do you know why you would mention it in your e-mail, where you have said that was important to Harriet and Karl, if there was no reason? Do you know -- do you have any idea why you would write that?

SAMPSON: As I said, that was based on an assumption. I knew it was important to Sara Taylor and to Scott Jennings, both of whom reported to Mr. Rove.

TODD: Sampson, pressed on an e-mail he sent last November to White House lawyers -- the subject, the U.S. attorney replacement plan.

SEN. PATRICK LEAHY (D-VT), JUDICIARY COMMITTEE CHAIRMAN: You told Ms. Miers and Mr. Kelley that you had not informed anyone in Karl's shop, which you considered a -- quote -- "pre-execution necessity" -- close quote. By Karl? Are you referring to Karl Rove?

SAMPSON: Yes.

TODD: Sampson says the plan was circulated to Rove.

Why are the senators targeting the president's top political adviser?

BRUCE FEIN, FORMER ASSOCIATE DEPUTY ATTORNEY GENERAL: By insinuating that it's Karl Rove who has the clearance here, it's insinuating that it's a partisan process, not a non-political or politically even-handed application of uniform standards of law enforcement.

(END VIDEOTAPE)

TODD: Bruce Fein says the insinuation of partisanship in the firings doesn't imply Rove did any illegal, but he says it could erode the public's confidence in who President Bush placed in those U.S. attorney jobs -- Lou.

DOBBS: And erode the confidence of the country in an independent Justice Department.

Brian, thank you very much -- Brian Todd.

TODD: Thank you.

DOBBS: Tonight, the White House issued this terse statement in support of the attorney general -- quote -- "The president is confident the attorney general can overcome these challenges."

President Bush is under pressure tonight, not only because of the U.S. attorney firings, but also because of the deadline that Congress will send him to pull our troops out of Iraq.

Ed Henry now has the report of a beleaguered president who is trying to fight back.

(BEGIN VIDEOTAPE)

ED HENRY, CNN WHITE HOUSE CORRESPONDENT (voice-over): In pictures and words, a not-so-subtle message from the president: While Democrats are busy investigating, Republicans are legislating.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: And so we had a very productive session, a session of friends talking amongst friends, all aiming to put a strategy together of how we can work together to secure this nation and keep it prosperous.

HENRY: Never mind that the president, who has spent very little time cultivating lawmakers, never previously had all the House Republicans over to the White House at the same time. But, in this hour of need, with controversy raging over the firing of eight U.S. attorneys, the administration is eager to show they're focused on the nation's business.

QUESTION: Is it a distraction as the president tries to... (CROSSTALK)

DANA PERINO, DEPUTY WHITE HOUSE PRESS SECRETARY: He's not distracted.

HENRY: For the second straight day, the president threatened to veto a war funding bill passed by the Senate Thursday that would begin withdrawing U.S. troops from Iraq within 120 days.

BUSH: We stand united in saying loud and clear that, when we have got our troops in harm's way, we expect that troop to be fully funded. And we have got commanders making tough decisions on the ground. We expect there to be no strings on our commanders.

HENRY (on camera): The White House is already charging that the Army and Marines are borrowing money from other accounts in order to pay for equipment, because of the holdup in war funding. Democrats are firing back that, if the president wants to get money to the battlefield so fast, he shouldn't veto the bill.

Ed Henry, CNN, the White House.

(END VIDEOTAPE)

DOBBS: And that war-funding legislation passed by the Senate today would have all of our troops out of Iraq by the end of March 2008. It passed narrowly, but with the support of two Republican senators.

Andrea Koppel reports from Capitol Hill.

(BEGIN VIDEOTAPE)

SEN. BARACK OBAMA (D), ILLINOIS: The ayes have -- are 51. The nays are 47.

ANDREA KOPPEL, CNN CONGRESSIONAL CORRESPONDENT (voice-over): But, by the slimmest of margins, Senate Democrats passed the bill, and, with the help of two Republicans, Nebraska's Chuck Hagel and Oregon's Gordon Smith, practically dared Mr. Bush to veto it.

SEN. HARRY REID (D-NV), MAJORITY LEADER: The ball is in the president's court. We have done what we have to do to take care of people who are fighting for us.

KOPPEL: Like the House version, the $123 billion Senate bill is chockablock with sweeteners, pet projects to help farmers, Iraq war veterans, and victims of Hurricanes Katrina and Rita.

Republicans called it a ploy to buy votes, but even more alarming, they said, the bill's goal, to withdraw most U.S. combat troops from Iraq by March 31, 2008. That's five months earlier than the August 31 deadline agreed to by the House.

Republicans said Democrats had, in effect, set a date for defeat. SEN. RICHARD SHELBY (R), ALABAMA: It is the wrong message at the wrong time. Surely, this will embolden the enemy. It will not help our troops in any way. It's a big mistake.

KOPPEL: The challenge now for appointed lawmakers in the House and Senate: to bridge their differences on a date for withdrawal before the bill is sent to the president's desk -- a bigger challenge, how to proceed if Mr. Bush makes good on a threat to veto it.

SEN. PATTY MURRAY (D), WASHINGTON: We challenge the president not to veto a bill that finally takes care of those men and women who have worked so hard for us.

KOPPEL (on camera): And, despite the fact that Senate Democrats and Republicans have already selected their members to negotiate with the House, over in the House, Republicans and Democrats have yet to do so, Which means any effort to reconcile their differences will have to wait until at least the middle of next month. That's when Congress returns from its spring break.

Andrea Koppel, CNN, Washington.

(END VIDEOTAPE)

DOBBS: And violence all across Iraq today -- a car bomb went off near a parking lot in -- south of Baghdad. At least four people were killed there. But that wasn't the worst of it, by far. In two separate bombings in crowded Shia marketplaces, 119 people were killed, more than 170 others wounded.

And one of our soldiers has died of a non-combat-related illness. Seventy-nine of our troops in Iraq have died this month; 3,245 of our troops have been killed since this war began, 24,314 of our troops wounded, 10,841 of them seriously.

Up next here: Iran shows no sign of backing down six days after its forces captured 15 British sailors and marines in the Persian Gulf. We will have the latest.

And the divine agenda in American politics: religious leaders of all persuasions rating presidential candidates and pushing issues, all on faith.

And the plan to give amnesty to millions of illegal aliens in this country is heating up on Capitol Hill. I will be joined by Congressman Luis Gutierrez, who is leading the charge, and Congressman Brian Bilbray, who is trying to stop it.

Stay with us.

(COMMERCIAL BREAK)

DOBBS: Tonight, the standoff between this nation's strongest ally and Iran is intensifying. It's been six days now since Iran captured 15 British sailors and marines while they were inspecting a cargo ship in the Persian Gulf. Barbara Starr has our report.

(BEGIN VIDEOTAPE)

BARBARA STARR, CNN PENTAGON CORRESPONDENT (voice-over): Iranian TV showed more video of 15 British sailors and marines taken away on a small boat by Iranian forces. Iran says the British were inside their waters. The British say they were not.

The Iranians promised to free the only female detained, seaman Faye Turney. That is now suspended, Iran says. Tehran released a new letter Turney purportedly wrote, calling on the British to withdraw from Iraq.

A body-language expert says Turney is obviously under duress.

UNIDENTIFIED MALE: Well, if we look at this smile here, it's certainly not a genuine smile.

STARR: An Iranian military official made his case with a map and a GPS device, saying the British violated Iranian boundaries. The British Ministry of Defense Wednesday used the same technique.

CNN has learned that, minutes after the British are surrounded and captured, their commanders call a nearby U.S. Navy helicopter and patrol boat, asking the U.S. to try contacting the British sailors and marines. A British helicopter sees one of the small British boats headed for the Iranian coastline, the seized troops sitting in the front. The Iranians are at the wheel. There are unconfirmed reports of gunfire.

The British had brief radio contact with someone speaking in broken English, saying the seized troops were in "no harm" and being "taken to a safe place." When the British crew protested, the radio went silent.

Vice Admiral Kevin Cosgriff, the top U.S. naval commander in the Middle East, in an interview with the Dow Jones News Service, criticized the Iranian action. "It's aggressive. It's illegal," he said.

The State Department, hoping for a diplomatic solution to the crisis, is focused on protecting a vital economic region.

NICHOLAS BURNS, UNDERSECRETARY OF STATE FOR POLITICAL AFFAIRS: The Gulf is not an Iranian lake. It is an international waterway. And we will protect, as we have since the late 1940s...

STARR (on camera): Iran now says the British have violated their water space several times. As the war of words escalates, there's no longer any predictions about when the marines and sailors may be released.

Barbara Starr, CNN, the Pentagon.

(END VIDEOTAPE) DOBBS: Tensions between Iran and Britain and the West are driving world oil prices higher. The price of crude oil today surged above $66 a barrel. That is the highest price this year.

The world -- the White House has strongly rejected a charge by Saudi King Abdullah that U.S. troops in Iraq constitute what the Saudi king calls an illegitimate foreign occupation.

White House spokesman Dana Perino said U.S. forces are in Iraq under U.N. resolutions, and at the invitation of the Iraqi people. The United States and Saudi Arabia have long been allies, but the Saudis are seeking more of a leadership role in the Middle East, and apparently not too concerned about upsetting one of their largest oil markets.

Coming up next: Mexican truckers may soon have unlimited access to American highways, if the Department of Transportation and this White House have their way. It is seen by many as an outright threat to our national security. We will have that report.

And the Mexican government meddling in the case of imprisoned former Border Patrol agents Ramos and Compean? A new lawsuit suggests just that, a lawsuit filed against President Bush's White House. We will have the report.

And the divine agenda: religious leaders pushing their causes into the political arena. The line between church and state, blurred or obliterated?

Stay with us for all of that and a great deal more straight ahead.

(COMMERCIAL BREAK)

DOBBS: Religious leaders are trying to direct our national political agenda on issues from immigration, to the presidential race, to the Middle East peace process.

As Christine Romans reports now, religious leaders of all persuasions and faiths are vigorously pushing their divine agendas.

(BEGIN VIDEOTAPE)

CHRISTINE ROMANS, CNN CORRESPONDENT (voice-over): Thirty-five United States congressmen call for Americans to spend five minutes a week praying to build a spiritual prayer wall around America, until God heals our land. A divine agenda in American political life.

RICHARD PARKER, HARVARD UNIVERSITY: It's been this way from the very beginning. And it's been for good and ill. I mean, if you look at every major social reform movement in the United States, you will find the hand of religion in it.

ROMANS: Reform or interference? Conservative evangelical leader James Dobson tells "U.S. News & World Report," the actor and former Senator Fred Thompson is not Christian enough to be president, complimenting, instead, another former lawmaker, Newt Gingrich. Married three times, he recently admitted to an extramarital affair.

Dobson says Senator Thompson hasn't clearly communicated his religious faith. Quote: "Many evangelical Christians might find this a barrier to supporting him."

CHARLES DUNN, ROBERTSON SCHOOL OF GOVERNMENT DEAN, REGENT UNIVERSITY: It carries a lot of weight with this constituency. There are people -- we would call them true believers.

ROMANS: Believers who are a force in politics -- Pew Research says 24 percent of voters in the 2004 election were white evangelical Christians.

At the same time, the Israel lobby, the American-Israel Public Affairs Committee, woos American political leaders. And the Catholic Church vigorously supports illegal immigration.

CARDINAL ROGER MAHONY, ARCHDIOCESE OF LOS ANGELES: We simply cannot exclude them. We must find ways to bring them into the full light of our society.

ROMANS: Even promoting Senator Kennedy's proposals.

MARK KRIKORIAN, EXECUTIVE DIRECTOR, CENTER FOR IMMIGRATION STUDIES: You say specifically that there's a religious duty to vote for Ted Kennedy's immigration bill, that is going too far.

ROMANS: Religious moral authority critics say crosses the line into political meddling.

(END VIDEOTAPE)

ROMANS: Religious organizations have tax-exempt status and are prohibited from electioneering from the pulpit. They cannot endorse or oppose specific candidates. It's a fine line between moralizing free speech and potentially violating the tax code -- Lou.

DOBBS: Or just outright obliterating that line.

The -- Fred Thompson, he is a Christian, right?

ROMANS: His spokespeople say he is a Christian; he's baptized into the Church of Christ; he is a Christian.

DOBBS: All right.

Well, we have got that all cleared up. And -- and now we can sort out what religion has to do with presidential politics. Obviously it's having more and more to do with all kinds of politics in this country.

Christine, thank you very much -- Christine Romans.

That brings us to the subject of our poll tonight: should the Internal Revenue Service begin enforcing the laws against religious organizations that engage in political lobbying and conduct, yes or no? Cast your vote at LouDobbs.com. We will have the results here later.

And one of the world's largest women's groups in the country is up in arms tonight over a Bush administration program that would help men be better fathers. It's called the Promoting Responsible Fatherhood Initiative. And the White House is spending $50 million on it.

But the National Organization for Women says it is illegal, because it doesn't include women. Well, the White House rejects that argument, saying any program that teaches men to become better fathers will help children and women.

Up next here: the latest efforts to block what many see as a giveaway to the government of Mexico by the Bush administration. What's new? It's the plan to allow Mexican trucks to travel deep into the heart of the United States. And many claim that this is a tremendous national security risk, and they're trying to stop it.

And border betrayal: a new move to uncover the Mexican government's role in the prosecution of two former Border Patrol agents convicted on the testimony of an illegal alien Mexican drug smuggler.

And later: a new amnesty bill that would give U.S. citizenship to millions of illegal aliens. One of the bill's co-sponsors joins me, and so does one of its most outspoken opponents.

Stay with us. We will be right back.

(COMMERCIAL BREAK)

DOBBS: Tonight, a Bush administration plan that would allow Mexican trucks to carry goods all over the United States deep into the country's heartland is meeting new opposition. Critics say that, if the White House were to have its way, even more illegal aliens and more illegal drugs would flood unimpeded into this country.

Lisa Sylvester now reports on the latest efforts to block the administration and to keep America safe.

(BEGIN VIDEOTAPE)

JENNIFER TIERNEY, TRUCK SAFETY COALITION: Good girl. Yes, good girl.

LISA SYLVESTER, CNN CORRESPONDENT (voice-over): Jennifer Tierney misses her dad. He died at the age of 55 in a collision with a tractor trailer. She's now a member of the Truck Safety Coalition. The group opposes a Department of Transportation pilot program that would allow hundreds of Mexican trucks to travel anywhere in the United States.

TIERNEY: They absolutely do not have the same safety standards as U.S. trucks. They do not require the random alcohol and drug testing that's required here in the United States. They can cross the border after having worked 14, 16 hours, and still legally drive 11 more hours in the United States.

SYLVESTER: Congressman Duncan Hunter has introduced legislation that would block the program, unless new requirements are met. Transportation officials would have to show how Mexican carriers will comply with U.S. regulations and how authorities will enforce those rules.

And U.S. law enforcement would need access to Mexican truckers driving in criminal records.

REP. DUNCAN HUNTER (R-CA), PRESIDENTIAL CANDIDATE: There is no way for our American law enforcement officials to know whether or not one of these drivers who's driving in a truck and trailer, which could have tens of millions of dollars worth of illegal drugs in it, whether or not he's been arrested four, five, six, seven, eight times for narcotics in Mexico.

SYLVESTER: Independent U.S. truck drivers say national security and safety are not the only worries. They could lose their jobs.

TODD SPENCER, EXECUTIVE VICE PRESIDENT, OWNER-OPERATOR INDEPENDENT DRIVERS ASSOCIATION: The net effect of what they're trying to do is take trucking, a $623 billion annual -- $623 billion industry in America, and simply outsource a significant chunk of those jobs to another country.

SYLVESTER: The Department of Transportation intends to move forward, despite the criticism, saying, "The cross-border trucking demonstration program will bring real benefits and real dollars to the American economy, while maintaining all U.S. safety and security standards."

(END VIDEOTAPE)

SYLVESTER: The Department of Transportation would like to begin the pilot program as early as April. But a Senate committee voted to block funding for the program, until the Transportation Department releases more details of the plan, and can show that the pilot project meets congressionally mandated safety and security standards -- Lou.

DOBBS: It's amazing what -- what this administration tries to run and pull.

Thank you very much. Appreciate it. Lisa Sylvester.

Newly released figures show the number of legal immigrants into the United States becoming U.S. citizens is now at a record high. According to the Pew Hispanic Center, the number of naturalized citizens in 2006 -- or rather 2005 was almost 13 million people. That's 52 percent of all legal immigrants now living in the United States. And nearly 2.5 million Latin immigrants became citizens between 1995 and 2005. For the first time, immigrants from Latin America and Asia outnumbered the number of European immigrants applying for American citizenship. The study found the number of Mexican immigrants becoming citizens has risen an astonishing 144 percent over the past decade. But the report also points out Mexicans are still less likely to become citizens than any other immigrant groups.

Was the Mexican government instrumental in the prosecution of two former border patrol agents Ignacio Ramos and Jose Compean? We may soon know because of a lawsuit filed seeking to force the Bush administration to release documents in this case. Casey Wian has the story.

(BEGIN VIDEOTAPE)

CASEY WIAN, CNN CORRESPONDENT (voice-over): The anti- government corruption group Judicial Watch is suing the Bush administration to release documents related to the vigorous prosecution of two border patrol agents who shot a Mexican drug smuggler transporting 743 pounds of marijuana in 2005. Former Agents Ignacio Ramos and Jose Compean are serving more than a decade in federal prison for wounding Osbaldo Aldrete-Davila, an illegal alien, and not properly reporting the shooting near the Mexican border.

TOM FITTON, PRES., JUDICIAL WATCH: We want to know about any backroom deals involving this drug runner that was used as a prosecution witness against these boater patrol agents. We want to know if there are any secret deals, especially between the United States and Mexico and what went on there.

WIAN: Official records show the investigation began when the drug smuggler's mother in Mexico contacted the mother of a border patrol agent in Arizona. The questions about the Mexican government's involvement intensified, after homeland security investigators briefed members of Congress on the case. Reportedly, they said the investigation began with a complaint from the Mexican consulate.

REP. TED POE (R) TEXAS: I don't know that they would have been prosecuted had there not be some type of involvement from a foreign power, namely, Mexico.

WIAN: Tuesday, on a special edition of "Lou Dobbs Tonight," prosecutor Johnny Sutton denied there were orders from Mexico or Washington, DC to prosecute the case.

DOBBS: The Mexican council contacted who?

JOHNNY SUTTON, U.S. ATTORNEY: The Mexican consulate wrote the standard letter that they always write in these kind of cases.

DOBBS: Are you sure it was the standard letter?

SUTTON: These cases - well, I don't know. The letter was sent to homeland security, but I can tell you that this case originated like any other case that we try in El Paso.

WIAN: But there was no case against the drug smuggler, even though DEA documents show the same homeland security investigator involved in the Ramos-Compean case had clear evidence Aldrete-Davila was tied to a second drug load while he was under U.S. government protection.

(END VIDEOTAPE)

WIAN: Those documents show the owner of a stash house in Texas identified Aldrete-Davila as the owner of a 750-pound load of marijuana. He was identified by name, by physical description. He was even picked out of a photo line-up. Yet, he, not the agents, went free, Lou.

DOBBS: Thank you very much, Casey, Casey Wian, following this case throughout from its very beginning.

A new bipartisan piece of legislation that's been introduced in the House could give amnesty to as many as 20 million illegal aliens and it may be the Bush administration's last and best chance to make so-called comprehensive immigration reform a reality. Joining me now, one of the bill's most vocal critics, Congressman Brian Bilbray of California and one of the bill's co-sponsors, Congressman Luis Gutierrez of Illinois. Good to have you both here.

Congressman, this legislation, it reflects the efforts of McCain, Kennedy. It's the second time that you moved the legislation forward. Why is there any reason for this bill to be passed at this point in this forum?

REP. LUIS GUTIERREZ (D) ILLINOIS: Well, I think we saw that simply building a new fence between the border of the United States of America and Mexico and the partial immigration reform bill that was passed last year doesn't resolve the problem of immigration reform. They've given that a chance. I think there's a new Democratic majority that has a commitment in the House of Representatives to hearing the case. I'd like to share with you, but we were never given a chance to bring the bill to the floor or even have a debate in the Judiciary Committee. We're going to have that opportunity now. And so it's much better. We practiced it last year. It went through. There's a lot of work that needs to be done. That's why I'm here. If it were a done deal, I'd be home. I'm here with you because it's not a done deal, Lou. ... the debate alive

DOBBS: And this man here is to make sure as well that you -- that you have to keep spending some late evenings.

REP. BRIAN BILBRAY (R) CALIF: Yes, sir.

DOBBS: Congressman Bilbray, you're going to fight this bill obviously all the way. Why?

BILBRAY: Because there's amnesty written all over it. It's a very innovative package. It's got this so-called touchback which is really just -- there's sort of a sham little way of going it, but it rewards those who are illegally here and says that America is no longer going to enforce its immigration policies with the fact that we're not going to allow people to have citizenship. We're not going to allow them to have permanent residency. This bill does all the things that the Kennedy and McCain proposal did last year, only it adds some really bizarre spins to it.

DOBBS: What do you say Congressman Gutierrez? GUTIERREZ: I say the following. And I just want to take a second, "Dallas Morning News," we could add 15,000 agents to keep illegal immigrants from sneaking in, unmanned aerial vehicles, grants monies to states and cities, creates a criminal penalty for anyone caught avoiding a border agent, introduce harsher sentences for immigrants involved in gang activities, build 20 few facilities for 20,000 detainee illegal immigrants. For Mr. Bilbray to say that we aren't doing something, the truth is our immigration system is broken. But I don't think any of those things, Lou, you and I will disagree are necessary and are lacking in our current broken immigration system. So we propose to them and at the same time, I think -- I know what we do is we approach this with a sense of fairness and balance because in justice there is fairness and balance and we say to those that are here, I have 700 pages. There isn't amnesty written anywhere in those 700 pages.

DOBBS: Usually Congress is very direct so I'm very shocked.

GUTIERREZ: To pay a $2,000 fine, to learn English in civics classes, to pay all your back taxes to get at the end of the line, to be able to get a permit to work here six years, I think most of the American public will say that's a fair proposal.

BILBRAY: That was a proposal in '86. It's been defined by the law books as amnesty and the fact is when you say the back of the line, they're not talking the back of the line. They say that if you go over in six years and show up anywhere, we'll allow you to come back immediately. If you say you're illegal, you have people lining up that would love to come here legally that they'll be in front of.

DOBBS: You were over with the White House talking about the president's enthusiasm for comprehensive immigration reform. Do you guys have a love fest? I mean, this -- he's locked up really tight with his favorite legislator, Senator Ted Kennedy, and by definition, Congressman Gutierrez and the Democrats on this, did he president persuade you?

BILBRAY: The president is absolutely so far off base on this, it's astonishing to see somebody like Mr. Kennedy who could bad mouth the president at every turn, all at once embrace him over a proposal of that -- to reward illegal immigration. It's the same failed policies of '86, the same failed policies that lost last year and frankly, it's the one that will drag the Democrats before the American people if they try it again. The Republicans paid their price for not having interior enforcement. The bill that's being proposed here, none of them have true employer enforcement across the board, comprehensive - you've got a phased in system that some people have to get checked. But not everybody down there.

GUTIERREZ: It's just not true, we have the most robust interior enforcement ever proposed before the Congress of the United States and I hope afterwards you and I can spend some time over some coffee so we can share some more time. Lou, we have biometric system in here, unheard of, never attempted before. And we say it is a must. So that if you're in the United States of America, you can't work unless you have a Social Security, maybe it will have your fingerprint, maybe it'll have your photo, but it will be biometric and it will put harsh penalties against anybody that hires anyone without that ID. That ends illegal immigration as we know it.

DOBBS: The last time you and I talked Congressman, we talked about -- everybody is talking about coming out of the shadows and do this or that. At the same time saying that illegal aliens are insinuated in an indispensable way into our economy and society. So there's a little bit of room for discussion on that.

But one of the things that's most mind-boggling about all of this is the suggestion that there's some desperate need for illegal immigrants in this country, that there's a desperate need for -- for as many as, you know, an additional 20 million illegal -- or legal, in this case it would be legalized -- another 20 million immigrants under the terms of this proposal. But I want to -- you and I talked the last time. You said you'd check me out on these numbers. This is the state of legal immigration in this country. We are bringing two million people a year into this country admitted legally into the United States, 400,000 H1 visas are granted each year, 900,000 other employment visas issued each year, 660,000 student visas issued each year, 455,000 temporary employment transfers granted and did I mention a million people are given permanent residency status in this country each year, 700,000 people achieve U.S. citizenship each year. My goodness. What are we talking about? It's not like we have walls that are impenetrable just as the open borders and the amnesty lobby wants. We're talking over three million people, congressman.

GUTIERREZ: Well, let me just say the following. If you don't want students to overstay their visas and stay in this country undocumented, if you don't want temporary workers to stay in this country undocumented, then you need a fool-proof system that makes sure that every employee -- I'm just trying -- if I could, you really need a fool-proof system. I not only sit on the Judiciary, it sit on the financial services committee. And so when Alan Greenspan came before us, I said what do you think? He said --

BILBRAY: Look, you don't have to give amnesty and you don't have to open up the gates for illegal immigration and -- and go for un- control. You go with H.R. 98. Sylvester Reyes, a former border patrol agent sitting down with David Dreier, Republican, and the border patrol agents -- the border patrol agents were asked if there was one thing to do to control illegal immigration, what would you do? And they said a true check system, a true document and your -- your documentation does not follow everyone the way that Sylvester Reyes' does.

GUTIERREZ: Sylvester Reyes now is a primary sponsor of this.

DOBBS: We got strange bedfellows here, a leading Democrat, the chairman of the House intelligence and Republican Congressman Bilbray and Senator Ted Kennedy embraced by this --

GUTIERREZ: That's bipartisanship.

DOBBS: Yes, it is. You know what else it is? Mighty curious. Thank you very much. Congressman Gutierrez, thank you very much. GUTIERREZ: Thank you.

DOBBS: Bipartisanship. You see a lot of it around Capitol Hill.

BILBRAY: In this case, it's the only way we're going to get it done.

DOBBS: I know, I know.

GUTIERREZ: There aren't enough Democrats.

DOBBS: I think -- unfortunately, you've got me there. I think there are plenty of both members of both parties. Thank you both.

Up next, the impact of free trade, so-called, on the American economy and American workers and their families. I'll be joined by Congresswoman Marcy Kaptur and Congressman Brad Sherman here next.

And one of the country's biggest retailers firings thousands of workers and offering them their old job some time later, but with much less pay. You've got to love what passes for economic policy. We'll have that outrageous report on another major retailer under fire, billions of their credit customers, well, their personal information is no longer so personal. Stay with us. We'll be right back.

(COMMERCIAL BREAK)

DOBBS: When somebody talks about something called fast track authority or trade promotion authority, I know that you watching and listening at home -- the excitement is starting to build, right? But there is one of the most critical issues facing this Congress as the president is seeking a renewal of his fast track authority to negotiate so-called free trade agreements. Yesterday on Capitol Hill, witnesses weighed in on free trade, so I'm giving a grim assessment of the impact on American workers. My guests obviously leading that hearing yesterday and Congresswoman Marcy Kaptur, Democrat of Ohio, a long-stranding critic of free trade and policies that do not place the American worker in primacy in domestic policy and Congressman Brad Sherman. He's a Democrat of California and chairman of the Foreign Affairs Committee's subcommittee on terrorism, nonproliferation and trade. Good to have you with us.

REP. BRAD SHERMAN (D) CALIF: Good to be here.

DOBBS: This Congress has a unique opportunity. It's unique for five years. And that is to decide whether or not the president gets to continue what I consider an absolutely idiotic trade policies. Is he going to succeed? Is your leadership going to allow him to succeed? Have Nancy Pelosi and Harry Reid, are they going to sell out the American worker and go ahead with fast track authority for the president?

SHERMAN: I think that's still weighing in the balance and I think we need to make it clear that we don't need to take fast track and just put a few conditions on it. We need to stop it. But even if we stop it -- DOBBS: Hallelujah, Mr. Chairman, hallelujah.

SHERMAN: That doesn't erase anything.

DOBBS: No.

SHERMAN: All that does is --

DOBBS: Could stop the bleeding a bit, huh?

SHERMAN: Yeah, but since we've got this $800 billion trade deficit last year, we'll run an $800 billion trade deficit at least this year, it's -- even if we stop it, we're not going to be radically changing our foreign policy.

DOBBS: Congresswoman, do you agree with the chairman that it's an open question here or are you more hopeful?

REP. MARCY KAPTUR (D) OHIO: Well, of course I've seen what's happened in past Congresses and I always have hope and I think that we have an opportunity this year to say, we have to turn this in a different direction. We've got to stop outsourcing our jobs. We have to start reinvesting in America. We can't keep knocking two points off our GDP because of our growing trade deficit of now nearly $ 3/4 trillion. That's lost strength, lost economic strength for our country.

DOBBS: I don't think most people realize that the 24 quarters of the Bush presidency, the fact is the trade deficit has been a drag in 18 of those quarters on economic growth. And I know this is tough, but the idea that a Democratic Congress elected as some say on November 7th to change direction in Iraq, but also I clearly believe to support, to help, and to nurture a middle class that is under absolute assault. How can the Democratic party leading both houses of Congress -- and I know you both stand for the American worker, for middle class men and women that are families, but for your leadership as -- and over the Senate, Max Baucus for crying out loud. The senator from Montana saying let's do it. Just make a couple of little tweaks. How in the world do you fight that, Mr. Chairman?

SHERMAN: Well, you get on shows like this and you urge people to contact their member of Congress and say Nancy Reagan had it right when she said just say no. I think she was referring to fast track.

DOBBS: Well, fast track and other bad things. How about that? You've seen a lot Congresswoman Kaptur and you've -- you've held forth on your views in this country. Business has such an absolute dominant influence on Capitol Hill, both Houses of Congress and obviously the White House. Is there any way in which we'll ever see labor organizations that have built so much, unions that have built so much, of the rights and the prerogatives and the quality of life for American workers, will they ever be in your judgment the countervailing influence to corporate power that they have been in decades past?

KAPTUR: Well, I think that trade unions, religious groups, environmental groups, citizens groups, consumer groups are joining together today, over 712 of them across our country announced strong opposition to fast track. I call it a fast ball. What we want is -- in this baseball season, we want to stop all fastballs through Congress and we want the ability to amend agreements. We want to work through the American people so that we don't have this sort of take it or leave it attitude that these administrations give Congress a bill that we can't amend. You just had people here an immigration. We tried to stop the hemorrhage from Mexico into our country, in the agricultural countryside back in 1993 when NAFTA was debated. We were not allowed to amend the agreement. We could have prevented a lot of the harm that's been going on.

DOBBS: I just want to say that it was at least, to me, listening to both of you and watching you over the course of your service, it's encouraging and it should be to everyone, I think, to see two public servants working on behalf of the American worker. So, you know, bless you and keep it rolling. And thanks for being here tonight.

KAPTUR: Thank you very much. Thank you.

DOBBS: Marcy Kaptur and Brad Sherman. I thank you both for being here.

Coming up at the top of the hour, "Larry King Live" and that means our Larry.

LARRY KING, CNN ANCHOR: Hey, Lou. Thanks for being with us last night.

DOBBS: My pleasure.

KING: Coming up tonight, two of the senators who grilled the attorney general's former chief of staff today about those fired prosecutors and one of the fired prosecutors, too. Plus the two comedians who got Karl Rove rapping last night. It's all ahead at the top of the hour. Were you there, Lou?

DOBBS: Larry, thank you very much.

Coming up next, same job, lower pay. One of the country's biggest retailers -- here we go -- firing thousands of its workers. Guess what? They do want to rehire some of them, but for a lot less money.

And millions of credit cards stolen. Those numbers and all of that information, personal information. How did one of the country's largest retailers allow it to happen, and who is hacking? Stay with us.

(COMMERCIAL BREAK)

DOBBS: The parent company of retailer T.J. Maxx now says information from almost 46 million credit card customers stolen by hackers. The thefts, disclosed by the company back in January, but now we're only learning about how large and how serious this security breach was. The company says its computers were hacked over a year and a half-long period that ended, they say, in January. The company says the identity of the hackers remains unknown.

New evidence tonight that the rich are reaping financial benefits in this economy that are disproportionate to what is happening to our middle class, who are being pressured to work for lower wages. As Kitty Pilgrim reports, one of the country's biggest retailers firing tens of thousands of workers, and then offering the same job for a lot less pay.

(BEGIN VIDEOTAPE)

KITTY PILGRIM, CNN CORRESPONDENT: New data shows that the top 1 percent of Americans are now 400 times richer than average Americans.

BOB GREENSTEIN, CENTER ON BUDGET AND POLICY PRIORITIES: We have not seen these kinds of gaps since before the Great Depression. We have now had two years in a row in which we had huge income gains at the top, and people in the middle and below did not share.

PILGRIM: He says the rich disproportionately benefit from the Bush administration tax cuts.

The American worker has been downsized, outsourced, laid off, and now companies are replacing experienced workers with cheaper ones.

The second largest electronics retailer in the country, Circuit City, is firing 3,400 of its best-paid workers. In an outrageous offer, the company says it will give these workers the opportunity to reapply for those same jobs at lower pay.

JONATHAN JACOBY, CENTER FOR AMERICAN PROGRESS: Having worked for a number of years for the company and moved their way up and developed their skills to be better salespeople is then rewarded by, in this case, oh, so you have to actually get laid off and come back, maybe if you want at a lower wage.

PILGRIM: Watchdog groups say big corporate chains like Wal-Mart make an effort to squeeze out older, long-term workers, who cost the company more in wages and health care.

DAVID NASSAR, WAL-MART WATCH: For the best part of the past two years, we've seen Wal-Mart engage in policies to try to get rid of workers who have stayed too long with the company. The only difference between Circuit City's decision today and Wal-Mart is that Wal-Mart has been underhanded about it.

PILGRIM: All of this is especially outrageous at a time when the CEOs of Wal-Mart and Circuit City are compensated in millions of dollars.

(END VIDEOTAPE)

PILGRIM: Labor experts say the economic war on the middle class has intensified. Now, for example, at Circuit City, the workers can reapply for their job, but they have to wait 10 weeks to apply for it. And the retailer can fill the job during that time. So on top of less money, there are no guarantees that the job will still be there, Lou. DOBBS: That's a tough one, Kitty. Thank you very much.

Still ahead, we'll have the results of our poll. Stay with us.

(COMMERCIAL BREAK)

DOBBS: The results of our poll tonight: 95 percent of you say the Internal Revenue Service should begin enforcing laws against religious organizations that engage in political lobbying.

We thank you for being with us tonight. Please join us here tomorrow. For all of us, thanks for watching. Good night from Washington. "LARRY KING LIVE" begins right now.

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