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LOU DOBBS TONIGHT

Troop Withdrawal Details; Bush, Dems Spar on War; Is Our Foos Supply Safe?

Aired November 13, 2007 - 1900   ET

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


LOU DOBBS, CNN ANCHOR: And as fortune would have it, we will be doing the same thing here, Wolf. Thank you, look forward to seeing you.
Tonight, welcome from Seattle, Washington, tonight we're reporting on new evidence that corporate America is refusing to stand up for America's working men and women and their families and end the importation of cheap workers from overseas. We'll have a special report.

Also, rising concerns tonight that the American dream may never become a reality for an increasingly large number of our fellow Americans, particularly African Americans. We'll have that report.

And Boeing's Dreamliner (ph) aircraft, supposed to be one of the country's biggest success stories. But the Dreamliner (ph) now facing huge delays because Boeing exported much of the aircraft's production overseas. We'll have that report.

And a lesson for businesses across the entire country. Please join us for all of that, all the day's news, and much more straight ahead here tonight.

ANNOUNCER: This is LOU DOBBS TONIGHT: news, debate, and opinion for Tuesday, November 13, 2007. Live from Seattle, Washington, Lou Dobbs.

DOBBS: Good evening, everybody.

Senate Democrats tonight launching a new effort to restrict the president's conduct of the war in Iraq. Senate Majority Leader, Senator Harry Reid said Democrats will not approve anymore money for the war this year unless the president agrees to begin withdrawal of our troops. Democrats today said what they call the true cost of the wars in Iraq and Afghanistan have already risen to more than $1.5 trillion. Republicans immediately responded, accusing Democrats of inflating that number for partisan purposes.

Jessica Yellin has the report on the day's politics from Capitol Hill -- Jessica.

JESSICA YELLIN, CNN CONGRESSIONAL CORRESPONDENT: Lou, the White House and congressional Republicans say this report is riddled with errors and they call it an exercise in political hyperbole.

(BEGIN VIDEOTAPE) YELLIN (voice-over): Democrats say it is time to count the money funding the war.

SEN CHUCK SCHUMER (D), NEW YORK: The cost of the war is becoming the $800 billion gorilla in the room when it comes to opposition to the war.

YELLIN: Eight hundred billion dollars, that's how much the president has requested for the wars in Iraq and Afghanistan. But a new report by congressional Democrats claims the real cost of those wars has been double that, $1.6 trillion. That includes what Democrats call the hidden costs, like lost productivity and the rising price of oil. It's a far cry from the price tag the administration put on the Iraq war before combat began.

DONALD RUMSFELD, DEFENSE SECRETARY, JAN. 2003: Well, the Office of Management and Budget has come up with a number that's something under $50 billion for the cost.

YELLIN: Democrats argue the staggering numbers prove the Bush administration has misled Americans.

SEN. HARRY REID (D-NV), MAJORITY LEADER: We cannot afford this war, $12 billion a month? We just can't -- we can't continue.

YELLIN: But Republicans say they won't apologize for spending money of the war on terror.

SEN. MITCH MCCONNELL (R-KY), MINORITY LEADER: Of course the war has been a costly war, but we have been protected from attack here at home.

YELLIN: And they accuse the Democrats of using fuzzy math. In fact, the nonpartisan Congressional Budget Office conducted a similar study on the total cost of war and they came up with a significantly smaller figure. But Democrats who oppose the war want to make this point.

REP. STENY HOYER (D-MD), MAJORITY LEADER: We will and we must pay for whatever cost to protect the American people. But tragically, unfortunately, incredibly, the war is not making us safer.

(END VIDEOTAPE)

YELLIN: Now, Lou, all this comes as the Democrats in Congress and the White House are locked in a spending battle, and as you know, the Democrats want to highlight every penny spent in Iraq. So they can draw a contrast to their own domestic spending priorities which they say are being under funded. Lou?

DOBBS: And, their refusal to spend anymore money is effectively, is it not, Jessica, pure political theatrics, because it's unnecessary for them to take any further step for another year.

YELLIN: They say that that's true, the Bush administration does not need new war funding until about April of next year, but the White House would disagree. They very much want some sort of funding bill for Iraq to pass through Congress.

DOBBS: Thank you very much, Jessica Yellin.

The White House today reaffirmed the president's opposition to any legislation that contains a timetable for withdrawal. That has been his position throughout. The White House remains confident that it can defeat any Democratic initiative to limit the president's conduct of the war. By some estimates, the White House has blocked as many as 40 attempts to change direction on the policy in Iraq over the past year alone. Ed Henry has our report from the White House -- Ed.

ED HENRY, CNN WHITE HOUSE CORRESPONDENT: Lou, White House officials believe they will easily turn back this latest maneuver on Iraq. White House spokeswoman Dana Perino declaring that this Democratic report on war cost is an attempt to muddy the waters because of recent positive developments on the ground in Iraq. The president making no bones about approving massive amounts of spending on national security, today signing into law a $471 million defense bill, that's a $40 billion increase for the Pentagon's budget, and yet at the same time today, he vetoed a labor health bill, charging that it was just too expensive, because of an extra $10 billion in spending. Mr. Bush lampooning the fact that lawmakers on Capitol Hill have filled that labor health bill with 2,000 earmarks.

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: Some of these wasteful projects include a prison museum, a sailing school taught aboard a catamaran (ph), and Portuguese as a second language program. Congress owes the taxpayers much better than this effort.

(END VIDEO CLIP)

HENRY: The point here is that the president wants to try and restore fiscal responsibility to win back conservatives who are angry that federal spending has increased so much on his watch. But by signing the defense bill at the same time, that he's vetoing the labor health bill, it certainly opens the president to Democratic criticism that he's spending humongous sums on the wars in Iraq and Afghanistan while penny pinching on domestic programs like health care for Americans. Lou?

DOBBS: But at least not funding a prison museum -- Ed Henry, thank you, reporting from the White House.

New details tonight about U.S. troop withdrawals from Iraq. The military saying a combat brigade will leave Diyalah (ph) province north of Baghdad in the coming weeks, when the so-called troop drawdown is completed sometime by next July. There will still more than 130,000 of our troops in Iraq.

Jamie McIntyre has our report from the Pentagon -- Jamie.

JAMIE MCINTYRE, CNN SR. PENTAGON CORRESPONDENT: Well, Lou, every month, thousands of U.S. troops come home from Iraq, but what makes this redeployment a little different is that some of the troops this time will not be replaced. For instance, already this month, troops from the 10th Mountain Division and 82nd Airborne are on their way home.

But when the 1st Calvary Division begins to back up and leave over the next couple of weeks, one of the brigades in Diyalah (ph) province will not be replaced. That will be the beginning of the drawdown from 20 combat brigades to 19, and by the end of the summer 15 brigades. Now, U.S. commanders will be keeping a close watch to see if the recent positive trends, the drop in U.S. casualties and in IED attacks will continue, as the drawdown continues. They say they're ready to adjust if they don't -- Lou.

DOBBS: Jamie, still, 130,000 troops, by the time we get through with the brigade drawdown that you just reported, 130,000 by the midst of next year?

MCINTYRE: That's right, but here's the big catch. If when they get to the summer point, if the positive trends have continued, they have even more ambitious plans to draw down to about 100,000 by the beginning of 2009. But again, it's a very optimistic scenario, and we have known in the past that those optimistic scenarios have (INAUDIBLE) crashed into reality and had to be scuttled in the past.

DOBBS: Each of those optimistic projections, and point of fact, resulting in considerable disappointment. Jamie, thank you very much -- Jamie McIntyre reporting for us from the Pentagon.

Tonight, no American fatalities to report to you in Iraq, but the military said another of our troops was killed in Afghanistan. Eight of our troops have been killed in Afghanistan so far this month; 385 of our troops killed in Afghanistan since the war began; 1,753 troops wounded; 704 seriously. More of our troops killed in Afghanistan so far this year than in any other year since the war began six years ago.

Coming up here next, disturbing new testimony about the government's utter and complete failure to guarantee the safety of this nation's food supply. Lisa Sylvester will have the report -- Lisa.

LISA SYLVESTER, CNN CORRESPONDENT: Lou, large corporate agri- business firms are injecting carbon monoxide into meat packaging that could end up on your kitchen table. This is a story that you are not going to want to miss -- Lou.

DOBBS: And we won't, Lisa, thank you.

Also tonight, Yahoo reaches a settlement in a case that highlighted Yahoo's close links with China's communist regime and its cooperation with a police state for the purpose of commerce. We'll have the report.

And, we'll challenge corporate America's repeated assertions it can't find enough qualified Americans to fill key technology jobs. It turns out it just ain't so. Imagine that. We'll have that story, and a great deal more as we continue, live tonight with our "Independents Day" tour, live from, you guessed it, there's the Space Needle, Seattle, Washington. We'll be right back.

(COMMERCIAL BREAK)

DOBBS: New study show American colleges are producing more than enough graduates in Science and Math in this country to fill the needs of U.S. business, but corporate America continues to claim there simply aren't enough Americans trained in those fields and they must hire foreign workers, workers that of course end up being paid quite a bit less than American workers.

Bill Tucker has our report.

(BEGIN VIDEOTAPE)

BILL TUCKER, CNN CORRESPONDENT (voice-over): There is no shortage of students studying for careers in Math and Science. There is a shortage of jobs. That's the simply bottom line finding of a new study from the Urban Institute.

The study shows that between 1985 and 2000 435,000 U.S. citizens and permanent residents a year graduated with Bachelors, Masters, and Doctoral degrees in Science and Engineering. That's three times the number of jobs in Science and Engineering added per year, 150,000 during that time.

Separately Michael Teitelbaum at the Alfred P. Sloan Foundation told Congress last week that neither he nor a separate study by the RAND Corporation can find any evidence of worker shortages. These studies are not anomalies.

VIVEK WADHWA, HARVARD UNIVERSITY: Bottom line is that all of our research at Duke and now at Harvard shows the same thing. That there is no shortage of engineers; there's no shortage of scientists. Companies aren't going abroad because of skills. They're going abroad because it's cheaper.

TUCKER: As a result, Wadhwa says that more than half of the engineering graduate students at Duke don't pursue engineering as a career and there is another indicator that the market is anything but short of scientists and engineers.

PAUL ALMEIDA, DEPT. FOR PROF. EMPLOYEES, AFL-CIO: We should be trying to figure out how to incentivize (ph) students to advance in these Math and Science areas. It's clearly that there is no shortage. If there is a shortage, the supply and demand wages would be going up in these areas.

TUCKER: Wages in the science and engineering fields over the last five years when adjusted for inflation have been basically flat.

(END VIDEOTAPE)

TUCKER: Now Lou, that's the Urban Institute, the Alfred P. Sloan (ph) Foundation, Duke, Harvard, the RAND Corporation. Studies done independently of each other, different researches, different funding, all reaching the same basic conclusion that there is no worker shortage. Lou, the problem is not a lack of workers. The problem these studies all conclude is a lack of companies hiring them. And as we've reported many, many times on this program those companies either off-shore the work or as you mentioned at the top, demand more H-1B visas and then pay those workers less -- Lou.

DOBBS: We've been reporting on this issue, the exporting of American jobs, the outsourcing of American jobs, middle class jobs, for four years. And point of fact, the idea that all of these highly regarded, highly respected institutions have found the same thing that we have reported her for four years. Congress just last week, the subcommittee on technology and innovation, suggesting that 30 to 40 percent of American jobs now are at risk of being outsourced, in addition to the H-1B problem.

TUCKER: Right.

DOBBS: Let's put this in some context. Let's just deal with that H-1B program, which all of these companies want to bring those foreign workers in under. What's the number of Indian companies that are using H-1B visas, seeking H-1B visas for the purpose of outsourcing those jobs right here in the United States?

TUCKER: Well five of the top six users of the H-1B visa program, Lou, as you well know, are Indian companies.

DOBBS: Yes I did, but I wanted because I'm in Seattle, Washington, tonight Bill Tucker, and I thank you very much -- I want to repeat that just for the purpose, the benefit, the illumination, the education, the enlightenment of one of the -- this city's most famous citizens, Microsoft Chairman Bill Gates. Bill Gates is among those calling for more H-1B visas. In fact, Bill Gates wants an unlimited number of H-1B visas. And we really think it's important that he be brought up-to-date on this issue. Gates testified before a Senate committee in March -- by the way, he was the only witness and there was only one fellow chariot -- that was Senator Ted Kennedy -- and Gates said the United States should allow, as he put it, an infinite number of foreign workers. We can't get above infinite no matter what we do.

(BEGIN VIDEO CLIP)

BILL GATES, MICROSOFT CHAIRMAN: We have to welcome the great minds in this world, not shut them out of our country. Unfortunately, our immigration policies are driving away the world's best and brightest precisely when we need them the most.

(END VIDEO CLIP)

DOBBS: Bill Gates, you just heard the RAND Corporation, the Urban Institute, Harvard University, come on and look at the facts. Most of those H-1B visas are being used by Indian companies seeking to outsource jobs at a very, very reduced wage. In fact, most of the H-1B computer professionals in this country are brought in at the lowest skill levels; about half of the H-1B visa computer professionals recently admitted to the United States, in fact during the (INAUDIBLE) entry level salaries, so much for the advanced, best minds. These are entry level jobs, not the highly skilled jobs seeking those H-1B visas.

So Mr. Gates, I certainly hope that you and I can have a discussion on that. I'm sure that you would be delighted to do that, but I'm going to ask for something less than an infinite number of H- 1B visas and when we compromise, as a matter of fact, I want to return to two years ago levels.

Now a follow-up to our reports on how American technology companies are helping communist China crack down on its own citizens. Technology tonight ha a lot to be proud of, don't you think, in the reports that we're considering tonight. Yahoo today settled a lawsuit with two Chinese journalists, both of whom were jailed after Yahoo provided information about their online activities to communist Chinese government officials.

Yahoo's CEO, Jerry Yang (ph), testified about the incidents before Congress last week. Yang had the decency and the civility and the maturity to apologize to the mother of one of the jailed journalists after being urged to do so by members of that congressional panel.

Congressman Tom Lantos, the chairman of the House Foreign Affairs Committee, told Yang (ph) and other Yahoo executives at that hearing, quote, "while technically and financially you are giants, morally you are pygmies." Today Chairman Lantos said "it took a tongue lashing from Congress before these high-tech titans did the right thing and coughed up some concrete assistance for the family of a journalist whom Yahoo had helped send to jail."

Human Rights USA represented the two journalists, by the way. Attorney Morton Spar (ph) tells us more than 200 dissidents in communist China have been arrested as a result of information provided by U.S. Internet companies or by technology provided to China by U.S. companies.

That brings us to the subject of our poll tonight. The question is do you believe corporate America will ever regain its conscience? Yes or no. Please cast your vote at LouDobbs.com. We'll have the results here tonight as we continue from Seattle, Washington.

Let's take a look at some of your thoughts. Angel in Delaware wrote in to say "If idiots grew on trees, the White House would be an orchard." I had never heard that expression. I couldn't agree more.

Malinda in Missouri said "Why don't you throw your hat in the ring and run? That would make the elitists run for cover like the roaches they are." Well I think we can go to less extreme measures to get those roaches running.

And Scott in Missouri, "Those buffoons in Washington will get a clear message in the 2008 election. We once party-affiliated voters are becoming the Lou Dobbs Army of Independents. We need the will of the people to rein again, not special interests."

We'll have more of your thoughts here later in the broadcast. Each of you whose e-mail is read here receives a copy of my new book, "Independents Day: Awakening the American Spirit".

And by the way, in Phoenix, Arizona last night, a clear statement of that awakening, quite a turnout and I want to say thanks to the city of Phoenix for a warm welcome.

Still ahead, alarming new research showing the income gap is widening between families in this country. The American dream for many no longer a reality. We'll have a special report.

And the meat you eat may not be as fresh as you think nor as safe. What your federal government isn't telling you or any of us.

And tonight, an extraordinary story, a family fighting the state of Oregon to stop their foster child from being deported across the border to Mexico. We'll have that story and we'll meet the principal. Stay with us.

(COMMERCIAL BREAK)

DOBBS: Tens of millions of Chinese exports to this country are being recalled and many of those recalled products are toys, toys contaminated in many cases with lead. And this after toy brands in the country promised that this holiday shopping season would be America's safest. Well it turns out that millions of holiday lights and wreaths are also containing dangerous amounts of lead. Those all brought in from communist China, almost all of them, they're sold at major retailers around the country.

Those boxes come with clear labels, by the way, that do advise hand washing. When you see caution on a box of something made in China and nearly everything is, you better read it. They caution that you should wash your hands after handling the items because lead causes birth defects and cancer.

Those warnings are required because of a California law known as Proposition 65. By the way, that's a clue. That didn't happen because the governor or the legislature, Proposition 65, a public initiative, requiring a warning on any product with enough lead or toxic ingredients to cause either cancer or birth defects -- incredible.

Well shocking testimony about the safety of our food. Members of Congress heard that the federal government, the powerful meat industry and its lobbyists aren't telling American consumers the whole truth about the safety of our food. Imagine that.

We first reported here four months ago on a common industry practice that makes meat and seafood look fresher than it actually is. As Lisa Sylvester now reports, consumer groups are now demanding an end to that deceptive practice. (BEGIN VIDEOTAPE)

SYLVESTER (voice-over): Guess how old this meat is. Despite its bright red coloring it's actually nearly two years old, spoiled and well past its expiration date according to an Energy and Commerce Congressional subcommittee. Large food companies have been injecting meat packaging with carbon monoxide that gives it an artificial fresh look.

The committee chair grilled meat industry executives saying that consumers are being duped because the products are not labeled. In fact, some meat packages say all natural.

REP. BART STUPAK (D), MICHIGAN: Should science be allowed to deceive the consumer of the product they're about to purchase?

SYLVESTER: The companies argue shoppers should go by the sell by date, not by the look of the packaging, but consumer groups say that's not enough.

WENONAH HAUTER, FOOD AND WATER WATCH: This sell by date is so small that I can hardly see it with my progressive lenses and an elderly person would not be able to see it. This is deceptive packaging.

SYLVESTER: The U.S. Department of Agriculture approved carbon monoxide packaging based on data provided by the industry, but Representative Bart Stupak produced an internal e-mail from the company Hormel (ph) that called into question the validity of the data. Hormel (ph) acknowledges the memo, but says the process is still safe. The industry points out there have been no deaths or illnesses.

GREGORY PAGE, CARGILL, INC.: It allows us to pack case-ready product in our plant and provide the maximum available shelf life to consumers and provide them with a tamper-proof, leak-proof package that they then can rely on in their own homes.

SYLVESTER: Many major U.S. meat companies have told the government they either plan to or are opening to warning consumers that they can't rely on the color of meat to tell freshness. The European Union, Japan, and Canada have all banned the use of carbon monoxide in packaging.

(END VIDEOTAPE)

SYLVESTER: Now the Food and Drug administration has never done and independent review looking into the safety of carbon monoxide as a color fixative. Instead the FDA determined that it fell in a classification of chemicals generally recognized as safe -- Lou.

DOBBS: Generally recognized as safe, the United States falling behind the European Union, Japan, and other countries in banning this practice. It's so difficult I'm sure for many Americans to remember when this nation set the standard for consumer safety and for concern for health of the public. Thank you very much, Lisa -- Lisa Sylvester reporting from Washington. Appreciate it.

Up next, fewer Americans than ever are thinking about seizing the American dream. African Americans in particular slipping even farther behind in the quest for the American dream. We'll have that special report. It's outrageous.

And Senator Hillary Clinton's campaign admits planting a question at a public event. I'll be joined by three leading radio talk show hosts who will tell us what they think about, well the senator's conduct, this horse race and maybe even what was discussed just a little bit, some of the issues that we think these candidates might be talking about in the national interest, just a thought.

And new evidence of the complete absurdity of the U.S. immigration policy enforcement, an American child being sent to Mexico against the wishes of his parents and foster parents. We'll be talking with the parents, the foster parents, and a radio talk show host who has taken up their cause. All of that and a lot more when we continue from beautiful downtown Seattle, Washington, the "Independent State" tour continues.

(COMMERCIAL BREAK)

LOU DOBBS, CNN ANCHOR: Welcome back to Seattle where we're continuing our Independence Day tour.

One of the issues that I address in my new book is the issue of equality in this country as a fundamental national value we must preserve at any cost. And unfortunately, a major new study is confirming the American dream is becoming far harder for Americans to achieve especially for African-Americans. Researchers tracked incomes of more than 2,000 families over a period of 30 year. Their findings are disturbing, at best.

Christine Romans now reports on how African-Americans are rapidly losing ground in what we thought was an improving social picture. Our report, the war on the middle class.

(BEGIN VIDEOTAPE)

CHRISTINE ROMANS, CNN CORRESPONDENT: It's the American dream to do better than your parents and climb the income ladder. A new report compared working families over 30 years and found rare bipartisan consensus on the state of the American dream. Two-thirds of families are better off than their parents. But the report questions whether the American dream is a reality for black and white families alike.

JOHN MORTON, ECONOMIC MOBILITY PROJECT: If you're a middle income African-American parent in the 1960s your children have almost a 50 percent likelihood of being part of that lowest 20 percent income group as adults. And I think that's a fairly devastating finding.

ROMANS: And while almost half of middle class black children end up falling into the bottom 20 percent by income, only 16 percent of middle class white children did so. The study found achieving middle income status does not appear to protect black children the same way it protects white children. Another finding, upward economic mobility was driven by women.

JULIA ISAACS, BROOKINGS INSTITUTE: We saw incomes rise over the generations but that much of this was fuelled by women joining the labor force. The American dream is working but not equally for everyone.

ROMANS: Bottom line, they say the rags to riches stories more often found in Hollywood than reality. Only 6 percent of children born to parents at bottom of the income distribution make it to the top.

CAROL SWAIN, VANDERBILT UNIVERSITY. I believe that most people are like me. We want to live in a country where people can overcome circumstances of their birth where you can hope for your children to do a little better than you did and that's not happening now.

ROMANS: This report does not conclude why or prescribe policy fixes.

(END VIDEOTAPE)

ROMANS: Indeed, Lou, no solutions here. This report was meant to be a rare consensus on the economic situation of American families today. Consensus that both left and the right can agree on. Lou?

DOBBS: The fact is, we know, in recent polls that two-thirds of those surveyed doubt that their children will be able to create lives for themselves better than their own, which is a devastating statement about the health of the American dream for all Americans. But to suggest that African-Americans continue to have, after achieving middle class status, to have greater difficulty than American white middle class people is -- I mean, that is -- that's just crazy. It's something that shouldn't be happening in 2007.

ROMANS: It's absolutely devastating. Now it's time for the powers that be, Lou, to figure out how to fix this. It's 30 years after the civil rights movement.

DOBBS: Forgive me, Christine. The powers that be, you know, I'm not too big on the powers that be. It's time for us as independent- thinking Americans, voters, citizens, to take this matter into our own hands and assure that this economy of ours works for all of us. It's just outrageous. Christine, the -- is there any good news in this? Surely there is at least the news that the black middle class is growing and growing significantly?

ROMANS: I guess the good news in this is that the overall gains in income came from all these millions of women going to work over the past generation. It was a change in dynamic overall of the workforce, not some other issue that moved up the income for all of these families. What happens next for the next generation? What's going to be the thing if all of the women are already in the workforce, what's going to be the thing that will propel this forward for our children?

DOBBS: I guess a cynic could say the next logical step would be child labor, if that is the way in which to drive income. Christine, thank you very much. Christine Romans.

Up next here, new poll numbers out show Senator Clinton slipping in Iowa. Three of the best radio talk show hosts in the country join me. We'll be talking about that and all the day's political news.

And a foster family fighting the state of Oregon to keep their child in the United States. The foster parents among our guests here.

Stay with us. We'll continue our Independence Day tour live from Seattle, Washington. We'll be right back.

(COMMERCIAL BREAK)

DOBBS: I'm joined now by three of my favorite radio talk show hosts. With me here in Seattle, Dave Ross, KIRO; Dave also heard nationwide on the CBS Radio Network. And Michael Medved, nationally syndicated talk show host. And in our D.C. bureau, Joe Madison, WOL in Washington, heard all over the world on XM Radio. Good to have you.

Let's look at this new poll. Clinton and Obama, and just sort of -- let's get this horse race stuff out of the way. Clinton down to 44 percent, Obama down to -- up to 25 percent. Are you pretty excited, Dave, that to see there's a lot of electricity now in the democratic campaign?

DAVE ROSS, KIRO IN SEATTLE: I don't know. She's still got a dominating lead. She's got plenty of money. She's got her husband protecting her from the boys.

DOBBS: How about that protecting the little lady, as it were?

MICHAEL MEDVED, NATIONALLY SYNDICATED HOST: It's an indication they're worried and that they feel that they're in trouble and I think they should. I mean if you look at the most recent Zogby poll jus out today, she's only three points as head of Obama in Iowa. With her prohibitive lead, if she loses in Iowa and she could even conceivably finish third, she won't be dead, but she'll be in trouble.

DOBBS: You know, Joe Madison, I have to tell you, I hadn't thought about the dynamics of a man watching his wife run for president, but I don't -- I'm - I've got to be honest. I don't blame Bill Clinton for wanting to slap the dickens out of some of those idiots.

JOE MADISON, WOL IN WASHINGTON, D.C.: Some people think she should have slapped Bill Clinton a couple of times. But --

DOBBS: You're always keeping this in historical perspective.

MADISON: You got to have historical content. Let me tell you, I got to tell you, right now I'm not going to worry about the polls, Lou. I'm so upset with the news -- and I'm hoping tomorrow in Las Vegas that these candidates address these statistics that you read earlier today. I mean it is not brain surgery what's happening. To have Bill Gates on your program talk about importing more workers when we've got enough workers here to leapfrog over --

DOBBS: Speak of wanting to slap the dickens out of somebody.

MADISON: I mean what I heard and let me tell you, tomorrow morning I'm going to tell you what we're going to be talking about. Let's see if these candidates come up with solutions tomorrow. That's when I'm going to really be looking at. So forget about the polls right now. We've got some major issues right here. And any time you export jobs, you import workers, what the hell do you this going to happen to the middle class black or white in this country?

ROSS: How about the idea of taking some of that money that we're using rebuild Iraq and rebuild bridges in danger of collapsing and the highways that are crumbling? Those jobs can't be outsourced because they're right here there.

DOBBS: Well, you know I would have said that three years ago, Dave. But I watched these idiots bring in illegal aliens to help in the reconstruction in New Orleans as they drove out a 500,000 of their citizens and left them.

ROSS: Where were the unions?

DOBBS: Where are the unions?

ROSS: Unions should be insisting that these be union jobs. The unions' job is to keep wages up, right? Keep wages up, Americans will show up to work.

MADISON: They did at one time. I tell you, I got a little show and tell for you, Lou. Today, I brought with me my form. Remember I promised you I was going independent? This is the form. I it -- it's now official.

DOBBS: God bless you.

MADISON: I checked off no party. That's exactly the way I feel about it.

MEDVED: Wait.

DOBBS: Wait a minute. Michael, this is a special moment for Joe and me.

MADISON: Show and tell.

MEDVED: Now that you've had your wonderful feeling of exultation, I just don't understand when you re-register as independent in many states that means you have no voice in the primaries. It means absolutely nothing other than that. You want to vote in the primaries except in New Hampshire, you have to be registered as either republican or democrat, otherwise you're wasting your time with one of the fringe parties that never succeed in American life.

MADISON: Excuse me, excuse me, you forget, I live in Washington, D.C., the last great plantation of America. You know what difference does it make? For me, other than the fact that I'm going to independent voice because I'm sick of both of them --

MEDVED: Joe, in fairness, Washington, D.C., sends delegates to the republican convention and to the democratic convention. If you want to have some kind of choice or some kind of voice in between whether it should be Hillary or Obama or Edwards, you want to be a democrat.

MADISON: Not in Washington.

DOBBS: Forgive me Mr. Madison.

MADISON: I'm sorry.

DOBBS: Just to say one thing.

MADISON: Yes, Mr. Dobbs.

DOBBS: What difference does it make? You all with your clever parties and your partisan politics produced in 2004 in a nation of 300 million people the most racially ethnically religiously diverse nation on the face of the earth, you produced two candidates from the democrat and republican party, both sons of privilege, both graduates of Yale University and both members office skull and bones. Now I can understand why you're excited about people having the choice. Good lord, Michael, let's get real.

MADISON: And two families have controlled this government, two families for the last, what, 20 years.

DOBBS: All right.

MEDVED: The question is, if you don't like that, and obviously there are reasons --

ROSS: The only thing better would be a monarchy for crying out loud.

MEDVED: I will agree with you that a choice Kerry and Bush was less than inspiring.

DOBBS: Ha!

MEDVED: However, if you don't care for that, what's the answer? The answer is not saying that I'm going advocate participation in the political system. Political system ...

ROSS: Is there an independently wealthy candidate who's going to mount this campaign because where's the organization behind it?

DOBBS: Let me tell you I believe that watching. There are two candidates who have got some impulses that I like amongst these folks. Ron Paul has got some interesting ideas. John Edwards has got some interesting ideas. Together, they make, I think, a really interesting candidate. But the fact is, Ron Paul raised over $4 million in one day. If that doesn't serve notice to you what can happen when people get excited about a candidate, imagine the margin talking about at the center and everybody get excited about an independent candidate, populous candidate and really wanted to make a difference.

MEDVED: OK. When has that happened, Lou, where it's made a difference?

DOBBS: You're right. This is America, we can be innovative. We can't expect anything new. We have to keep making the same ...

ROSS: But you've got to do it day after day. I ran for office, right? To raise $1.5 million I had to make 9,500 phone calls. It takes money to run a campaign. If he can repeat that day after day, he's got a chance.

MADISON: I come from this school. A democrat can be a fox, a republican a wolf, a fox and a wolf are members of the canine family, politics is a dog eat dog business, and I don't intend to be the bone of either party.

DOBBS: Amen! You know Joe, just since you got that paper, you were smarter than hell before but you're getting smarter every minute.

MEDVED: Can I make one comment on that? A bone is usually part of a skeleton which means it's dead. And you be sent yourself from American political participation, you're dead.

MADISON: No.

DOBBS: Let me say to you --

MADISON: This political system is broke.

DOBBS: I couldn't agree with you more as you know, Joe. I want to congratulate you on being an independent. And I wasn't kidding when I said it's a special moment between Joe and me. It really is because he's one of my favorite folks. He's one of the people making a difference as are you guys.

ROSS: He should sneak into a party meeting and be subversive.

DOBBS: He's like me.

ROSS: Subversive.

DOBBS: Thanks a lot. Michael, good to have you. Joe, thank you.

Coming up at the top of the hour, "OUT IN THE OPEN," Rick Sanchez. Rick.

RICK SANCHEZ, CNN ANCHOR: Hey Mr. Lou, have you seen this John McCain video?

DOBBS: Which one? SANCHEZ: You're going to be seeing it in a little while. I mean it's - you know you can think all you want about Hillary Clinton, but when you use a word that demeans women the way it was used by one of his supporters and then to watch the way he reacts, we've got it. We've been working on this story all day. I'm telling you, he could be in some trouble for this. You're going see it at the top of our show.

DOBBS: The only problem with that Rick is I think all of them ought nobody trouble for wait they're conducting themselves.

SANCHEZ: Regardless of what words they use, right?

DOBBS: There you go.

SANCHEZ: Yes. This goes a little over the pail. I think you might agree. Also, talk about America's middle class getting of the shaft, man. They're now saying the hidden cost of Iraq, $1.6 trillion, $1.6 trillion. A lot of it borrowed from your friends over there in China. Of course, your kids, kids' kids, me kids, my kids' kids will be paying this for a long time and it's just really problematic.

And then Lou, one more thing. We've got this shooting in New York that everybody's talking about and early in the day everybody was coming down hard on the police officers who did this because you know they shot an unarmed black man. But we've been looking into details of this and the 911 call's out and you know what? There's some extenuating circumstances here. These officers may actually not have been so out of line. So we're going to break that down. And you know, just take a common sense approach to it, which is what we like to do. Back to you, my man.

DOBBS: Well, I'm glad I could set a standard for you. The fact of the matter is that $1.6 trillion may be a little short. Joe, what's the number, closer to $2.4 trillion by the time we're through. These are numbers. The real numbers that are important are 4,000 Americans almost killed in Iraq and nearly 30,000 wounds. Those are the big numbers. We look forward to it, Rick. Thank you very much.

SANCHEZ: Not to mention not just ones killed but ones coming back maimed, psychologically, physically who they have to deal with it for many years to come and so are the rest of us.

DOBBS: And I hope we deal with it better than we have at this point. Rick, thanks.

Coming up next, did Boeing jeopardize its new Dreamliner by outsourcing its manufacturing overseas trying to sell a couple of airplanes? Did they make a deal with the devil? You better believe it. We'll have that report.

And an extraordinary custody battle, Oregon trying to send an American citizen to Mexico even though its foster parents are desperate to adopt a child. I'll be talking to the foster parents and the radio talk show host who has taken up their cause. Stay with us. We'll be right back.

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DOBBS: An unusual custody battle involving an American citizen known as baby Gabriel in the northwest. His mother also an American citizen, a convicted criminal. His father, an illegal alien, a convicted criminal as well. Tonight, Gabriel living with his foster parents. Now the Oregon State Department of Human Services intends to take this child and send him to live with his grandmother in Mexico with a possibility of a monthly allowance paid for by Oregon taxpayers. The reasoning behind all of this is mind boggling especially considering the foster parents you're about to meet are fighting to adopt a child.

Joining me now is Gabriel's foster parents Steve and Angela Brandt and Lars Larson who has been championing the cause on his Portland, Oregon radio broadcast since last month when the Brandts first learn that they could lose little Gabriel. Thank you all for being here. Steve, Anglea, how did we get here? What does it look like is going to happen right now?

STEVE BRANDT, FOSTER PARENT: Well, it's been about, I guess, 45 days since this all started, since we contacted Lars with the story. And you know, we're at this point now, in between we've had adoption committee twice. Both times the adoption committee ruled against us. And you know, we've taken it to court because we feel that's our last chance.

DOBBS: How soon do the two of you think that your and let me ask you, Angela, how soon do you think you'll hear from the court as to what the possibilities are?

ANGELA BRANDT, FOSTER PARENT: Well, we expect to hear something from Lincoln county judge this week, whether or not they've accepted our paperwork. And then when there will be a hearing.

DOBBS: Let me tell you how I got interested in your case. I'm talking to Lars Larson on his radio show. He tells me about your case. And I couldn't believe it when Lars said that this state agency was refusing to talk to you, refusing to talk to foster parents who are the adoptive parents --

LARS LARSON, RADIO SHOW HOST: They want to adopt the child.

DOBBS: They thought they had been selected as the adoptive parent, since Gabriel was 4 months old. We called the same people you did to find out how intractable some folks were. We called both state senators. We called the congressional delegation. We called the State Department of Human Services, and these are rather arrogant people, with the exception of Senator Steve Gordon, who responded to us, he's outraged by this. First of all, my congratulations to you for doing what you're doing. This is ...

BRANDT: Thank you.

DOBBS: This is the way it's supposed to work, to both of you, I know it's very painful. This is a special needs child because of the addictive mother. What happens now, Lars?

LARSON: Well, this is an ugly situation because the State Department of Human Services is going to take this baby, 2 years old. He's been with the Brandts 21 months of the 25 months since his birth. They're going deport him. Now that's not the technical term. I guess you could call it exile. We don't even do this to criminals in America. We don't exile them from their own country.

DOBBS: We don't do this to illegal aliens.

LARSON: We don't. And he is an American citizen. The moment he crosses that line to go to Mexico you may think, grandmother has some DNA with him but the minute he crosses that lane, every civil right he has disappears. What's best for the child is supposed to under the law be what decides this case.

DOBBS: We have received word the governor of Oregon will, it turns out, review the case. He's asked the attorney general to review the case. What do you think?

LARSON: It shouldn't have taken that. Six weeks ago when we first brought this up, we said what is best for the child? To go off to a third world country where he has no rights and be raised by a woman he doesn't know, by a woman who's language he doesn't know.

DOBBS: Steve, Angela? Your thoughts? Our hearts go out to you. It is --

LARSON: He won't be last one, Lou.

DOBBS: Your thoughts tonight as we conclude?

BRANDT: Yeah, Lou, we're very upset. We thought we were -- we were told we were going to get this child. We're so upset because it's not in his best interest to send him to Mexico. You know, his -- he belongs with us. There's a bond already there. If we -- we can't be breaking that up and messing him up for life, possibly.

DOBBS: Well, I just want to thank you both. We all wish you the very best. It's -- and Lars, thank you.

LARSON: You're welcome.

DOBBS: You're championing a noble cause and a state government that is only now beginning to respond. I hope that the state of Oregon does far better than what it has so far. This is terrible. Let's be hopeful the governor's stepping in. Senator --

LARSON: And Lou, this could be happening in every state in America, out of sight.

DOBBS: Well, I appreciate it. And to both of you, Steve, Angela, thank you very much. All of the very best. And of course to little Gabriel, all the very best. We're going to stay on this. We're going to follow it up daily. See what support we can give you.

LARSON: Glad to let you know what we can find out.

BRANDT: Thank you.

DOBBS: All the best to the Brandt family.

Still ahead, an American aerospace giant outsourcing design, technology, latest aircraft, the plan backfiring somewhat. It turns out their idea of producing an airplane is a marketing campaign. It turns out that's not such a bright idea. We'll tell you all about that in a moment. Stay with us.

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