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Lou Dobbs Tonight
Slowing Economy; Economic Stimulus Argument; Further Word from the Campaign Trail
Aired January 18, 2008 - 19:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
LOU DOBBS, CNN ANCHOR: Thank you, Wolf.
Tonight President Bush says our slowing economy needs a temporary shot in the arm, as he put it, to boost economic growth. The president's plan will offer some help, without question but it certainly wouldn't end the faith-based economic policies that have devastated our working men and women and their families. We'll have complete coverage of those public policies and what needs to be done, what the president and the Democratic and Republican presidential candidates want to do, all of that, the day's news and much more straight ahead here tonight.
ANNOUNCER: This is LOU DOBBS TONIGHT: news, debate, and opinion for Friday, January 18th. Live from New York, Lou Dobbs.
DOBBS: Good evening, everybody. President Bush today announced plans to give the economy $145 billion shot in the arm, as he put it. President Bush acknowledged there is a risk of a downturn in the economy, but insists the economy will be just fine. Republican and Democratic presidential candidates offering their own prescriptions to help the economy. Democratic candidates calling for at least $70 billion of help for the economy while Republicans are demanding more tax breaks for big companies, among other measures. Kathleen Koch reports now from the White House. Kathleen?
KATHLEEN KOCH, CNN WHITE HOUSE CORRESPONDENT: Lou, this is quite a turnaround for a president who has long advocated let the market work. Don't intervene. But today President Bush acknowledged the federal government had to do something to give the faltering economy a boost.
(BEGIN VIDEOTAPE)
KOCH (voice-over): A shot in the arm to keep the economy healthy, a rare admission by a president that the economy he once described as strong and getting stronger needs help.
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: The fundamentals are strong but there's uncertainty.
KOCH: The stimulus package President Bush is prescribing would be large, $140 to $150 billion. It would include tax incentives for businesses and tax relief for the American people. President Bush wouldn't give specifics, but sources on Capitol Hill say the White House has suggested tax rebates, similar to those given in 2001. Individuals and families received checks for between $300 and $600. BUSH: This gross package must be built on broad-based tax relief that will directly affect economic growth and not the kind of spending projects that would have little immediate impact on our economy.
KOCH: Democrats insist spending programs combined with tax rebates would be most effective.
SEN CHUCK SCHUMER (D), NEW YORK: We know that extending unemployment insurance is one of the most effective stimulus proposals, because we deployed it successfully in the past and it gets the most bang for the buck.
KOCH: Democrats are also upset that tax rebates would not help the poorest Americans, those who don't earn enough to pay income taxes.
(END VIDEOTAPE)
KOCH: But Democrats do applaud the president's decision not to insist that his tax cuts due to expire in 2010 be included in the stimulus package. Now when might the stimulus package become a reality, both sides are saying as soon as possible or they would like to see something passed perhaps in a matter of weeks. Lou?
DOBBS: Well that would certainly be a wise course for both political parties to follow, the leadership of Congress and the president, and the president trumping all of the candidates both Republican and Democrat in his proposals, a substantially larger package proposed by the president today than any of those candidates.
KOCH: Quite so, Lou, yes, indeed, larger than anyone had even expected. We were hearing in the realm of 100 billion, perhaps 120 billion but the 140, 150 billion number that was put out today by Treasury Secretary Paulson, Lou, was quite larger than many had expected but they say that's what the economy needs to begin to turn around.
DOBBS: I'm sure there is no discussion, I was going to be facetious about it but I'll be straightforward. I'm sure there was no discussion at all about regulating those markets, particularly the sub prime mortgage market, the mortgage lending industry, and the banking industry that put themselves and the economy itself at risk.
KOCH: No, Lou, as a matter of fact, the White House stayed very studiously away from specifics but in particular, when reporters posed questions about the housing market, any injection, any specifics to help that area of the economy, the White House basically indicated they feel right now they've done enough.
DOBBS: Well, we shall, as they say, see. We thank you very much, at least there is action about to be taken, it appears. Kathleen Koch from the White House.
There are serious concerns tonight that the president's proposals, even if implemented would do little to nothing to help our nation's beleaguered middle class. Working men and women and their families are suffering from the crippling effects of a decade of faith-based economic policies and a failure to regulate markets and industry. So the idea that a government tax rebate will offer long- term help is questionable at best. Christine Romans has our report.
(BEGIN VIDEOTAPE)
CHRISTINE ROMANS, CNN CORRESPONDENT (voice-over): The big question -- will it work?
HENRY PAULSON, TREASURY SECRETARY: This is something that has worked well before, has worked in 2001, worked in 2003, get to consumers, put money in the hands of people, letting them spend it, rather than the government spend it.
ROMANS: Just how successful were those checks to 92 million taxpayers in 2001? Americans spent two-thirds of that cash over the next six months. According to the National Bureau of Economic Research, one thing, the recession, will it avert a recession this time?
MARK ZANDI, MOODYSECONOMY.COM: This stimulus plan won't stop that from happening but it could mitigate the severity of the downturn, it could make it shorter, it could make it less severe.
ROMANS: Sounds great, right? Labor economist Peter Morici says not so fast.
PETER MORICI, UNIVERSITY OF MARYLAND: A stimulus plan is like an aspirin. It will make us feel better for a little while but it won't solve the problem. Until we fix the trade deficit, until we fix the banks in New York, the U.S. economy is going to continue to lag, grow slowly and middle income Americans are going to suffer.
ROMANS: Suffer from an ongoing housing crash, that trade deficit topping $650 billion last year, the national debt a whopping $9 trillion. Those New York banks and brokers, hat in hand, to foreign governments and wealthy investors for emergency cash infusions of their own.
(BELL RINGING)
ROMANS: Alarm bells so loud rare bipartisan agreement has Washington moving ahead on a plan that must be temporary and quick.
UNIDENTIFIED MALE: When we get the legislation, we're going to run like a bunny here to, to, to get the relief out.
ROMANS: The president today told manufacturing workers in Frederick, Maryland that once Congress passes it, the country will be quote, "just fine."
(END VIDEOTAPE)
ROMANS: The president speaking to factory workers, some three million manufacturing jobs have been lost since the last recession. The recovery, in fact, the weakest many say in post-war history, despite massive fiscal and monetary stimulus already, Lou.
DOBBS: The reality is this is a very difficult economy right now to stimulate. It has been over stimulated by any standard over the course of the past five to six years without great result in terms of solid growth and structural improvement in this economy. The idea that this administration is, to hear Henry Paulson, the Treasury secretary say they're going to put money in the hands of the people, my gosh, they must have been biting through their lips to have to say that.
ROMANS: They're very clear that they want to make sure this is happening quickly and that it's short term and it's temporary. A lot of talk about temporary today, Lou, except when they talk about the president's tax cuts. They want to make those permanent but they want this to be, they want this to be temporary.
DOBBS: The best part of this economic package by this administration is that this administration is the one that is temporary. It is -- this is an administration, through its policies of deregulation, through its policies of failing to regulate and to provide oversight to these markets, to the banking industry, to the financial services industry, its failure to deal with trade industry -- trade policies that are demonstrably, absolutely disastrous for this country, the best thing is that the program is temporary perhaps, the solutions obviously will not be permanent by the thought, the brilliant people in the economic team of this administration, but thank God, this administration is temporary.
ROMANS: Long-term issues you're talking about, Lou, now a lot of debate about those today, we're talking about a very short term fix to the economy for right now, which leaves those other issues still at large.
DOBBS: Absolutely. Well hopefully during the course of this presidential election we will see some consensus develop around these issues and solutions. Christine, thank you very much, Christine Romans.
In our poll question tonight, President Bush says if Congress passes an economic stimulus package the country will be quote, "just fine." Do you agree? Yes or no. Cast your vote at LouDobbs.com. We'll have the results here later in the broadcast.
The president's plan today failed to lift the stock market. The Dow Jones Industrials fell another 60 points, closing at a new 10- month low. Most Republican presidential candidates welcome the president's stimulus proposal, but Senator John McCain expressed reservations. He said the Republican Party must stop what he called quote, "out of control government spending." Mary Snow reports from Hilton Head, South Carolina. One day before the Republican primary.
(BEGIN VIDEOTAPE)
(APPLAUSE)
MARY SNOW, CNN CORRESPONDENT (voice-over): It didn't take long for the president's economic stimulus plan to make it out onto the campaign trail.
SEN. JOHN MCCAIN (R-AZ), PRESIDENTIAL CANDIDATE: I want to talk a minute about spending, the president just gave a speech...
SNOW: In South Carolina Republican presidential hopeful John McCain said he'd like to work with the president and Congress as the president suggested, but he told crowds his priority is to cut government spending. McCain rolled out his own stimulus package a day ahead of the president that calls for a cut in corporate tax rate and a call to extend tax cuts now slated to expire in 2010. When asked about the president's plan, former Senator Fred Thompson expressed caution about a stimulus package that had too many promises.
FRED THOMPSON (R), PRESIDENTIAL CANDIDATE: He is talking about a package that would apparently entail about $150 billion that would mostly involve factory base. I think that if we're going to have a stimulus plan that's probably the direction that we need to go in.
SNOW: Mike Huckabee said he thought President Bush's stimulus package was on the right track.
MIKE HUCKABEE (R), PRESIDENTIAL CANDIDATE: Not even the IRS understands.
SNOW: He told crowds in South Carolina he wants to replace the income tax with a national sales tax, so-called spare tax.
HUCKABEE: Nothing would more readily revive our economy and give back the capacity for economic prosperity than completely scrapping our current tax system.
SNOW: Two candidates not in South Carolina also weighed in. In Nevada, Mitt Romney said the president's plan made sense, and that his economic stimulus package would be coming out soon, and had similar features. Rudy Giuliani called the president's package a positive step, and touted his idea for tax cuts to stimulate economic growth.
(on camera): And as Republican presidential hopefuls made their final pitches here, state officials reported that South Carolina's unemployment rate went up to 6.6 percent, that's the fifth consecutive month there's been an increase. Lou?
(END VIDEOTAPE)
DOBBS: Mary, thank you very much. Mary Snow reporting from Hilton Head, South Carolina.
Democratic presidential candidates today strongly criticizing the president's plan, no surprise there. Senator Clinton, Senator Obama and Senator Edwards all saying the package would provide little or no help to tens of millions of Americans. All three of them making a last-minute push to win votes of course in tomorrow's Nevada caucuses. Jessica Yellin has our report from Las Vegas.
(BEGIN VIDEOTAPE)
UNIDENTIFIED MALE: You are what we have...
JESSICA YELLIN, CNN CONGRESSIONAL CORRESPONDENT (voice-over): On the campaign trail the candidates are promising to heal economic wounds.
HILLARY RODHAM CLINTON (D-NY), PRESIDENTIAL CANDIDATE: I think your government, that you pay tax dollars to, should do more to help small businesses.
JOHN EDWARDS (D), PRESIDENTIAL CANDIDATE: We modernize our unemployment insurance laws to cover more people that we get help to the states directly.
SEN. BARACK OBAMA (D-IL), PRESIDENTIAL CANDIDATE: I call for a tax rebate, every American immediately gets $250 and then an additional $250 if the economy keeps on getting worse.
YELLIN: Sounds substantive, right? Well while the candidates are talking issues, the campaigns or their supporters are on the attack.
UNIDENTIFIED MALE: Hillary Clinton (SPEAKING FOREIGN LANGUAGE).
YELLIN: The ad says Hillary Clinton's supporters went to court to prevent working people from voting and Hillary Clinton has no shame. The ad is paid for by a labor union that supports Barack Obama. Now John Edwards is calling Obama a hypocrite since the ad is paid for by one of those reviled special interest groups.
EDWARDS: I hope Senator Obama will call for this ad, first denounce the ad, second call for it to be stopped.
H. CLINTON: But don't take it from me...
YELLIN: And Camp Clinton is getting in on the circular firing squad, leaping on this from Obama.
OBAMA: I think Ronald Reagan changed the trajectory of America in a way that, you know, Richard Nixon did not and in a way that Bill Clinton did not.
YELLIN: Clinton supporters say they're stupefied, baffled that Obama would praise Ronald Reagan, a man they say made life worse for women, minorities and the homeless and proves she's the real Democrat in the race.
(END VIDEOTAPE)
YELLIN: And Lou, the tit-for-tat of course does not end there. Senator Clinton just moments ago reacted to these new ads, the Spanish language ads calling Senator Obama on the mat saying that the ads that are running on his behalf are shameless, offensive, and untrue, and that he should denounce them. Bottom line, there's not a lot of love lost out here on the Democratic field's campaign trail. Lou?
DOBBS: Well, if Senator Obama likes Ronald Reagan so much, why in the world would they all not in that Democratic Party, Reagan was once a Democrat, as a matter of fact, why wouldn't they try not to be so -- I mean these people are carving each other up and doing so in the most petty and clumsy and regrettable fashions.
YELLIN: And when Clinton and Obama have attacked each other, the one who benefits is John Edwards so he could be smiling today.
DOBBS: If he's not smiling, I don't know what in the world it would take to make the man smile. Did they offer any explanation about why Senator Obama decided suddenly to take on President Clinton?
YELLIN: Well, look, part of his message all along has been we don't want to go back to the '90s. If she harkens back to this good old time he wants to remind people or point out that not everything was great in the '90s and that Senator Clinton -- President Clinton -- he also wants to make an appeal to Independents and Republicans and that may be what he's doing by invoking Ronald Reagan's name.
DOBBS: Well, this campaign is providing more than its fair share of amusing and sometimes, absolutely inexplicable twists and turns. Thank you very much, Jessica, for keeping us as clear on this as possible. Jessica Yellin, thank you.
More on the election campaign ahead here. Also rising concern in this country about escalating drug wars in Mexico. Casey Wian is on our southern border tonight. Casey?
CASEY WIAN, CNN CORRESPONDENT: Lou, parts of Mexico including Tijuana right behind me are in the grip of an all-out drug war. We'll tell you about the latest efforts by the U.S. and Mexican government to fight the drug cartel. Lou?
DOBBS: Thank you, Casey. Looking forward to it.
Also a victory for Marines everywhere, for Americans everywhere, in an unusual legal case in Chicago. I try not to be too often less than objective about what is happening, but I have to tell you, this story tonight warms my heart. I think it will warm yours, about justice being exacted in our justice system on behalf of one of those men serving in this nation's uniform.
Urgent new concerns tonight about the threat to our democracy and the integrity of our voting system from paperless voting. There are some states who just don't care. Let's find out whether you do or not. We'll have the story and a great deal more, next. We're coming right back.
(COMMERCIAL BREAK)
DOBBS: Drug cartel violence continues to escalate throughout Mexico. At least 12 people were shot and killed in the border city of Tijuana alone this week. Now the Mexican government is asking for help, tracing the American guns it says contribute to the violence. Casey Wian has our report from the California/Mexico border.
(BEGIN VIDEOTAPE) WIAN (voice-over): Terrified children carried to safety in Tijuana, a city under the siege of drug cartel violence. For three hours Thursday, gunmen fought Mexican soldiers, state and local police, after federal agents attempted to raid a house near the U.S. border that police called a drug cartel hideout.
EDGAR MILLAN, MEXICAN PUBLIC SAFETY DEPT. (through translator): Inside the house, six bodies of men were found gagged, blindfolded with the (INAUDIBLE).
WIAN: In this case, bullets to the head. Police say one gunman was also killed. Several officers were injured. Officials arrested four suspected shooters and flew them to Mexico City for questioning.
UNIDENTIFIED MALE (through translator): Two of the arrested were policemen. One of them, municipal and the other ministerial.
WIAN: Just the latest suspected link between Mexican law enforcement and drug cartels. Tuesday, a Tijuana police official, his wife and 12-year-old daughter, plus two other police officers were gunned down. A day later, U.S. Attorney General Michael Mukasey met with his counterpart, Eduardo Medina Mora.
They announced plans for an electronic database to help Mexican officials better track U.S. guns found south of the border. Mexico has long complained that the illegal supply of illegal guns from the U.S. contributes to drug cartel violence.
MICHAEL MUKASEY, U.S. ATTORNEY GENERAL: The United States is committed to addressing the flow of illegal guns into Mexico. We recognize that the control of our border is an important national security priority for both our governments and that this is a two-way street.
WIAN: President Bush has proposed a $1.4 billion aid package to help Mexico fight the cartels.
(END VIDEOTAPE)
WIAN: As expected, Mexican President Felipe Calderon's efforts to fight the drug cartels with federal troops has resulted in escalated violence all along the U.S./Mexico border. Last year, 2,500 people were killed in the Mexican drug wars and Lou, it appears that so far this year, things are no different.
DOBBS: And the very idea that the U.S. attorney general would be talking about border security and talking about it in terms of the movement of guns from this country into Mexico without either the attorney general nor his Mexican counterpart in that government raising the issue that the Mexican border is the primary source of methamphetamines, cocaine, heroin and marijuana into the United States, not to mention illegal immigration, it is unconscionable.
WIAN: That the Mexican government always makes the argument that there wouldn't be drug wars if it wasn't for drug consumers in the United States and guns that come from the United States but it's very clear that if the Mexicans did a better job helping the United States secure our southern border the drug wars would be a lot less intense.
DOBBS: Help us (INAUDIBLE) southern border take responsibility for their northern border. And by the way, when we talk about the flow of things across that border we should refer to this estimated 25 to $45 billion a year that flow into Mexico from the United States for those illegal drugs, in which provides the incentive for the open borders that the government of Mexico so desperately demands. Thank you for bringing us up-to-date, thank you very much, Casey Wian.
Up next here a new poll shows Barack Obama leading Hillary Clinton by a comfortable margin among black Democrats. That is a change. We'll have a special report on why that's happened and how important the race issue will be in this campaign. And by the way, anybody who thinks we're going to be moving away from the race issue in this country, well, apparently we're all going to be disappointed in that respect by this campaign.
And a U.S. Marine deployed in Iraq takes a Chicago attorney to court for a mean-spirited act of vandalism. We'll tell you all about it. We'll tell you how it turned out, and it turned out right for a change. Stay with us.
(COMMERCIAL BREAK)
DOBBS: I don't have the privilege often enough, certainly, to bring you just great news, and a story of justice, actually prevailing in this country. Tonight, I can tell you that a legal victory for the Marine Corps is in hand, a victory for everyone in uniform, and certainly for the American people. The case involved Marine Sergeant Mike McNulty (ph) and Chicago attorney Jay Grodner (ph). While Grodner (ph) was in court, charged with a mean-spirited act of vandalism against the sergeant's car, McNulty (ph) couldn't be there in person. That's because he's in Iraq, on his second tour of duty. Bill Tucker has our report.
(BEGIN VIDEOTAPE)
BILL TUCKER, CNN CORRESPONDENT (voice-over): Illinois attorney Jay Grodner (ph) couldn't bother to show up in court on time Friday. He was charged with criminal damage to property, for intentionally scratching this car, and causing $2,400 in damage to it. A car with military plates, belonging to Marine Sergeant Michael McNulty (ph). McNulty (ph) wasn't in court.
He couldn't show up. He's in Iraq. In Chicago the judge wasn't amused. He admonished Grodner (ph), placed him under arrest, and ordered him to post a $20,000 bond. A group of McNulty (ph) supporters were on hand to enjoy the spectacle. In the end, Grodner (ph) was returned to court.
He pled guilty to the charge, and agreed to pay $600 to the Semper Fi Injured Marine Fund plus 30 hours of community services and pay any associated court costs. The Semper Fi Fund provides money to support injured Marines and sailors and their families.
(END VIDEOTAPE) TUCKER: Now the police report says that when confronted, Grodner (ph) made anti-war and anti-military comments. The attorney now appears eager to put all of this behind him telling LOU DOBBS TONIGHT that he plans on leaving Illinois, perhaps even moving out of the country. He had no comment on his alleged anti-military, anti-Marine opinions. Perhaps his silence showed the better part of his discretion, Lou, because the prosecutor, the judge, and the deputy in court were all former Marines.
DOBBS: Well the Semper Fi Fund seems to be the appropriate place. As a matter of fact this broadcast will make, we'll call it a substantial donation to that fund as well just to celebrate, celebrate justice being done. This is a wonderful story. How in the world did they happen to catch this fool?
TUCKER: Well Sergeant McNulty (ph) had gone to pick up a friend of his, he was getting ready to deploy, he went to pick him up for breakfast, parked his car on the street, went and got his buddy, came back and the guy was standing there, Grodner (ph) the attorney was standing there in his car and laughing about the scratch that was on the car, and there were a lot of people, including Sergeant McNulty's (ph) brother, who says he should be commended for not just smashing the guy's windpipe but he called the cops, police came and a police report was filed.
DOBBS: Again, justice prevails, I mean, congratulations to the judge, the prosecutor, to the law enforcement, and of course to Sergeant McNulty (ph) and we can say with great gusto and heartfelt, Semper Fi. That is delightful. I love that story.
(CROSSTALK)
DOBBS: I love the fact that a man who feels that way about the United States military is leaving this country, too. Thank you very much.
TUCKER: You're welcome.
DOBBS: Time now for some of your thoughts. LaMora in Virginia, "The pro-amnesty coalition says that if we get rid of all illegal aliens the U.S. economy would collapse. Well they're here now in multitudes and the American economy is collapsing. Que pasa?" A well- observed fact.
And Robyn in Arkansas wrote in about the president's proposed stimulus package saying, "Lou, wow, an $800 rebate. What will I spend it on? Well luxury goods of course, like 2-ply toilet paper, non- generic soup, and an extra gallon of milk."
Robert in Oregon, "Is the stimulus package just a fancy word for corporate welfare?" Well perhaps not this time. We hope that that can be certainly the case at least.
And Rand in Illinois said "I need that $800 tax rebate, then I can rehire my chauffeur." We'll have more of your thoughts here later in the broadcast. You notice these are pretty American thoughts, I'm kind of liking this a lot. Each of you whose e-mail is read here receives a copy of my new book "Independents Day: Awakening the American Spirit". It is the book that corporate America, the Democratic Party, the Republican Party and the fools who try to run this country don't want you to read. I do. I'm begging you. Please.
Up next, rising concerns about e-voting and the risk of chaos at polling places all across the country, that chaos could begin tomorrow in South Carolina, by the way. Also Democratic presidential candidates stepping up their battle for votes of African Americans. We'll tell you how that's going for them. We'll have the latest opinion poll.
And President Bush proposing a temporary boost to our economy, three of our best political analysts will be here next. Stay with us. We're coming right back.
(COMMERCIAL BREAK)
DOBBS: About 75 million Americans will cast their votes this year on electronic touch screen machines, but many of those machines won't have a paper trail, won't have a paper record of those votes. As we reported on this broadcast for two years now, the machines leave voting districts vulnerable to miscounts and outright fraud. Kitty Pilgrim has our report.
(BEGIN VIDEOTAPE)
KITTY PILGRIM, CNN CORRESPONDENT (voice-over): Twenty states are still using electronic voting machines that don't have a reliable way to recount the votes on paper. Congressman Rush Holt has proposed a $630 million emergency bill to help states pay for the paper backup on Election Day in November.
REP. RUSH HOLT, (D) NJ: If we can get as many counties as possible to do the right thing, and we're trying to do that by offering to pay for the paper-based voting system if they choose to do it, and to pay for the audits, if they choose to do it.
PILGRIM: Many still paperless districts are in key election states. Although there is a growing movement to decertify some electronic voting machines. California, Colorado, Ohio, have all moved to decertify certain machines in recent months. But South Carolina still uses a nearly identical version of the ES&S IVotetronic (ph) system that have been decertified in other states. In South Carolina, computer scientists say there are fundamental problems with the way machines are designed.
PROF. DUNCAN BUEL, UNIVERSITY OF SOUTH CAROLINA: They're not very complicated, deep subtle errors. These are very, simple straightforward things that we teach students never to do when they're undergraduates in a computer science curriculum.
PILGRIM: ES&S answers the charges of design flaws saying, "All of our systems have been thoroughly tested and examined under realistic election conditions before those systems are ever made available to states for additional testing and consideration.
In South Carolina, legislators say the election committee does not want to change the system for the primary.
PHIL LEVENTIS, SOUTH CAROLINA STATE SENATE: This one would have been so easy to do with paper, just raw paper ballots, but for some reason, our elections commission says absolutely not.
PILGRIM: The South Carolina election commission responded, "we have security measures and end-to-end controls in place to protect us from known theoretical voting system vulnerabilities."
(END VIDEOTAPE)
PILGRIM (on camera): Now, Common Cause says Congress has to move fast to pass this measure in time for the presidential election, adding, "We know these machines malfunction." Lou?
DOBBS: I've had the privilege of getting to know some of the folks in the South Carolina legislature. These are responsible, intelligent - it's a great group of people. Why in the world are they permitting this to happen? This doesn't make any sense at all.
PILGRIM: We talked to many of the people in the government in South Carolina and they say they have met deep resistance from the election committee and they can't get it passed them. They basically will not acknowledge there are problems with this system.
DOBBS: It is confounding to think that we and the people of South Carolina basically have to cross their fingers and our fingers hoping that this thing works right, that is hardly the way to deal with this issue. All right, thank you very much, Kitty Pilgrim.
The professor who said that these folks were ...
PILGRIM: Duncan Buel.
DOBBS: ... programming this machine that a level his undergraduates wouldn't be allowed to.
PILGRIM: He was pretty explicit about how ...
DOBBS: His name?
PILGRIM: Duncan Buel.
DOBBS: I loved the way he described it. Thank you. Kitty Pilgrim.
Senator Barack Obama making gains with black voters according to a new poll, big gains in fact. The CNN/Opinion Research poll shows 59 percent of black Democrats are now supporting Obama, while 31 percent are supporting Senator Clinton. Suzanne Malveaux has our report from Charleston, South Carolina, on how the issue of race is playing out in this Democratic campaign.
(BEGIN VIDEOTAPE)
SUZANNE MALVEAUX, CNN CORRESPONDENT (voice-over): While the candidates may be downplaying the race factor, make no mistake, for some voters, it's bubbling just below the surface.
SAMUEL ROBINSON, AWENDAW, SC TOWN COUNCIL: It's not going to go away. Pigmentation. One of the truisms of this life is, I can't wash off this black. I can't bleach it off.
DIANE WIGGINS, SOUTH CAROLINA VOTER: There's too much history with the fact that there's, there is too much racism, and I believe that the blacks are the more racist than the whites.
MALVEAUX: Almost everyone we talked to said race is not a factor in deciding who goes to the White House.
JANIE POLUTTA, CHARLESTON RESIDENT: I think the qualifications are what's important.
CHERYL MACK, CLINTON SUPPORTER: We are united. Regardless of our race, color or creed.
MALVEAUX: But some who think race is a factor say it's almost a little embarrassing to admit.
CAROL SMALLS, SUPPORTS OBAMA: If Obama gets in there, it's truly a change, and that's what I would like to see, and it has nothing to do with his color.
Well you know what? I'm going to be honest, that's all I can be, yeah, I think I would like to see a black man in there.
MALVEAUX: Understandably, Barack Obama is a source of black pride, but he has transcended race and won the support of many white voters as well. But in South Carolina, dig beneath the surface and you find an unease.
WIGGINS: I feel that they have so much anger towards us, what is it, African Americans, they're not African Americans. They're Americans. Whether they're black, white, yellow, green, whatever. This is what I'm saying. They play such a big card on being an African American. They're not. And this is what makes me angry.
MALVEAUX: Why does it anger you?
WIGGINS: Because they say that they, you know, everybody should be equal and so forth. They're not. They're not, we're not equal.
MALVEAUX: What do you mean by that?
WIGGINS: Because everybody's playing the white card, the black card.
MALVEAUX: There is mistrust on both sides. Some suspect Obama's win in almost all-white Iowa was a fluke. Why do you suppose there were whites, though, in Iowa who were publicly supporting a black man?
ROBINSON: It was fashionable.
MALVEAUX: There is also among some black voters a nagging doubt about whether whites in South Carolina will give Obama a chance.
ROBINSON: When we close the curtain, when the lights go down low, and we can vote our prejudices, because we're hidden.
(END VIDEOTAPE)
MALVEAUX (on camera): Lou, what he's referring to is the fact that South Carolina is a primary, a closed process like New Hampshire, therefore, there is some doubt, some fear even whether or not you can even measure accurately the kind of support that is behind Barack Obama. Lou?
DOBBS: By the way, first of all, Suzanne, a wonderful report, and the ability to get close to the reality there, remarkable job, I must say. The idea that race in South Carolina is somehow a different issue, given its history, is, of course, valid, but the reality is, in Iowa, in New Hampshire, and I'm sure it's going to be the case as well in South Carolina, Senator Obama has won tremendous white support, and to hear the gentleman dismiss that as fashionable, is to me perhaps the saddest comment of those, among those several sad comments that I did hear.
MALVEAUX: There is a certain skepticism among some people, perhaps you can even see it as cynicism, that this can't transcend race. But what we did hear from a lot of people, they believe that South Carolina is changing, that it has changed and that if they feel that if race is not at least the first factor, perhaps it is the secondary one. Most people say, Lou, that they hope that it really is the platform of the candidate that will make the difference here but they also admit there will be a segment in the population that will still take race into account.
DOBBS: Of course the reality there is that if the United States does not elect Senator Obama as either the candidate or the president, that we are a racist society, that if we do not either nominate or elect Senator Clinton, we're a sexist society, and neither of those is, in my judgment, at least, even remotely valid, a conclusion to whatever does transpire here, and it sounds as though a lot of folks in South Carolina and perhaps around the nation feel that that's precisely what it would suggest.
MALVEAUX: And I think everybody's going to have to come up with their own conclusions. Some people may reach that conclusion, Lou.
DOBBS: Well, for them, I'm sorry. I think we're a lot better than that, and I think you're going to see that we're a lot better than that. I don't know who is going to be elected but I know we're a lot better than that rationale. Thank you very much, Suzanne Malveaux, a terrific report.
Coming up next, the president introduces a plan to stimulate our economy. Will it help America's struggling middle class?
Also on the eve of important contests in both Nevada and South Carolina, presidential candidates are talking about their economic plans. And there may be more than just national security behind Rudy Giuliani's position on a virtual border fence. We'll hear about that when we talk with our distinguished panel of political analysts next. Stay with us.
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DOBBS: Joining me now, three of the best political analysts in the country. Here in New York, Pulitzer Prize winning columnist, "New York Daily News" Michael Goodwin, syndicated columnist Miguel Perez. In our Washington, DC bureau, Roger Simon, chief political economist, Politico.com. Gentlemen, thanks for being here. Let's start with what happened to the truce, Miguel? This is turning into just ignorance, in my humble estimation, less humble than estimation, in Democratic Party. I mean, what in the world is going on?
MIGUEL PEREZ, SYNDICATED COLUMNIST: I think already the polls are beginning to show, Lou, that they're both, Senator Clinton and Senator Obama are hurting, and Edwards is picking up in the polls because of the fighting. The voters don't want to see this. The voters want to see the candidates dealing with issues and this race baiting and all of this stuff going on, it's really -- it's crazy.
DOBBS: Could you have possibly anticipated such a thing, Michael?
MICHAEL GOODWIN, "NEW YORK DAILY NEWS": Yes. Yes, I did. In fact, after the debate last -- earlier this week, when they had their truce, I wrote that you can't put these genies back in the bottle, and that's what the truce tried to do but it's out, it's going to stay out. It's going to flare occasionally. Because I think both of them have, in a way a similar problem. Which is they've got to drive up the negatives of the other person among certain groups.
DOBBS: Is it a point of fact, Roger Simon, is it the background, the legacy, the mind-set of the Democratic Party in particular, and my judgment, the Republican Party is owned lock, stock and barrel by corporate America, they simply, they have the majority voting stock in the Democratic Party, but the Democratic Party is truly the party, a group and identity politics, are we watching this simply explode in their faces?
ROGER SIMON, POLITICO.COM: We're watching it get very ugly. Nevada is an interesting stew of contending interests, and contending party groups within the Democratic Party. You have Latinos. You have African Americans and you have big labor. Sometimes those groups have the same agenda. Sometimes they don't. You can expect each candidate to exploit his or her advantages, and emphasize the disadvantages of their opponents in contests like this.
GOODWIN: And Lou, don't forget, too, in New Hampshire, when Hillary Clinton won by appealing to women. I mean she saw that, after losing Iowa, that became her way out. DOBBS: Let's go to what happened, the Nevada caucuses, of course, are tomorrow. In the labor union backing Senator Barack Obama, putting out a Spanish language radio spot, attacking Senator Clinton, that we referred to earlier in the broadcast, here's what the ad says. "Hillary Clinton does not respect our people. Hillary Clinton should not allow her friends to attack our people's right to vote this Saturday. Senator Obama wants our votes. He respects our votes, our community, and our people." Miguel ...
PEREZ: It's obviously meant to mean our Latino people, right. Is that what they're saying?
DOBBS: Apparently there is a whole separate group of people in this country, according to that labor union, the culinary workers, UNITE-HERE. It is the kind of thing I think every American should be offended, especially Hispanic Americans.
PEREZ: You know, when we talk about pandering, that's what we mean by pandering. Again, if they were serious about talking to us about the issues, that's fine but when it comes to this kind of thing where they basically distort reality, then we're all in trouble, all America suffers.
DOBBS: I mean, are we going to reach a point in this country because this campaign, we should be celebrating the fact we have put forward a woman to run for the president of the United States, a black man to run for president of the United States in the case of Senator Edwards, a guy who rose from very humble circumstances, we should be proud of that. We're going to see this nonsense, this ignorance become the defining characteristic of the campaign?
GOODWIN: I'm afraid we might, yes, and Lou, as to that ad itself, what's kind of backfire possibility is, the union, I think, actually had a good grievance there with the way the teachers' union, which is a Hillary Clinton backer, tried to stop the caucuses, for the casino workers, only after the union endorsed Obama, but by making it an Hispanic versus others issue, it could backfire on Obama.
DOBBS: Roger?
SIMON: Race is never far below the surface in American life, in American politics. We don't like to talk about it but it's always there, and there was no accident to that we've only had two elected black governors in u.s. History, one of them is serving now. Only three elected black senators. One of whom is serving now. Since reconstruction.
There's got to be some reason behind that, and Barack Obama is subtly in some ways but clearly selling redemption as his theme. He's not saying vote for me because I'm black. He's saying if you do vote for me, it sends a good message about the United States and yourself to the world, that we can ignore race and elect a black man in this country.
Hillary Clinton doesn't like that argument, because she thinks it's unfair and she says look, it's not just based on race. It's based on experience. It's based on what you can do. It's not just the dreamers. It's the doers. That's the tension there.
DOBBS: And a lot more tension in this race and we're going to be back with our panel in just a moment, but first, John Roberts, he is in Columbia, South Carolina, with a preview of what's coming up in the election center at the to the top of the hour.
John?
ROBERTS: Hey, Lou. Thanks very much. CNN election center coming up at the top of the hour, the economy, recession and the possibility of tax rebates are all the talk of the campaign trail today, and it isn't as simple as Republicans cheer, Democrats boo. I'll talk rebates and overall goals with Congressman Ron Paul. What's he really up to here in his campaign? We're also following potentially important changes in strategy by the Democratic candidates, and there is one way guaranteed to make a South Carolina conservative boiling mad. Find out how, coming up at the top of the hour, Lou. We'll see you soon.
DOBBS: Thank you very much, John. A reminder to vote in our poll tonight, the question, President Bush says if congress passes an economic stimulus package the country will be just fine. Do you agree? Yes or no? Cast your vote at loudobbs.com. Results upcoming and we'll return with our panel in one moment. Stay with us. We're going to find up what those Republicans are up to.
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DOBBS: We're back with Michael Goodwin, Miguel Perez and Roger Simon. Roger, the Republicans, I mean, my gosh, Mike Huckabee is starting to make, he's starting to sound really different than he did in New Hampshire, and Iowa.
GOODWIN: Well, he's facing a tough contest in South Carolina. It really is a must win state for him. He did win Iowa, but that seems like a long time ago. There's a big evangelical population in South Carolina, a lot of Southern Baptists. He's a Southern Baptist minister and if he's ever going to play the family values and Bible card, this is the place to play it and he's playing it.
DOBBS: How many cards are there to play in this thing? I mean, we're running out of cards to count. We've got race. We've got gender. We've got ethnicity. I mean, we've got evangelicals. I don't know.
GOODWIN: Well, and who is it, Penn of Clinton's campaign has a book out "Microtrends." The groups are getting broken down into smaller and smaller segments and they're being targeted. The Internet lets you target, direct mail. All of these things are targeting groups.
DOBBS: Miguel, is this our fault in the media, we tolerate this, that we put up with this and we play off of it and even deal with the candidates in the terms that they define?
PEREZ: In some ways because it is. I think we need to challenge a couple of reporters in the last couple of days have actually challenged Bill Clinton, on reporter challenged Bill Clinton, another reporter challenged Romney. I think we need to do that a lot more often. Because they're getting caught when we do that. Very important.
DOBBS: Let me quote to you if I may from your recent, your latest column. Saying, "Senator John McCain has the potential to motivate Latino voters." This is where you're right. "Latino Americans who live next door to illegal immigrants may have enough votes to elect the next president. In the end the immigration may swing this election but in the opposite way than the conservative candidates expected."
Why do you have that being the case?
PEREZ: Well, on the Democratic side, you have Hillary and you have Obama both favoring comprehensive immigration reform, which means some kind of legalization plan, on the Republican side ...
DOBBS: We call that amnesty. Go ahead.
PEREZ: We call it amnesty, we've agreed on that, and then on the other side you have only McCain, as far as Latinos are concerned, so McCain is the leverage for Latinos. Listen, what happens is Democrats usually take Latinos for granted. They give us a lot of lip service and they do nothing for us.
DOBBS: And 60 percent of Latinos, Hispanic Americans ...
PEREZ: Vote for them.
In this case now we have McCain to say hey listen, we have an alternative. That's our leverage.
DOBBS: And white folks of all stripes vote for either Democrat or Republican Party and these are the two parties that have made the dad-gum mess we're in. So let's be real clear, all races are absolutely equal in their stupidity in the two parties.
PEREZ: I mentioned this to you last week. I was waiting for Bloomberg. Because a lot of Latinos are tired of both parties, just like we are here.
GOODWIN: Very often on this program.
DOBBS: Sounds like we need a new candidate to get tired of.
GOODWIN: Lou, we're not going to have to wait long for Bloomberg. He's out there today. His speech yesterday in New York City is supposed to be a state of the city speech. In fact, it was really an announcement speech. He left town immediately to travel to Texas and California so he's running. The question is, does he make it official or does he back off?
SIMON: Well, if someone can show me a way that Michael Bloomberg gets the 270 electoral votes I'll buy him a drink or dinner or something. He may be running but he does not have a strong case, unless both parties nominate extremists that drive voters into the arms of an independent candidate. And I don't think that's very likely this time.
DOBBS: I'm sorry, an extremist from these parties?
SIMON: He needs to have candidates who don't represent a moderate position in either party. He needs extremes on the Democratic side. He needs extremes on the Republican side. So most voters who are in the middle say well, my gosh, there's no choice. I have to go for an independent candidate, even though independents rarely win but how likely is it that both the Republican Party and the Democratic Party are going to nominate this time extreme candidates who will scare voters to a third party position?
GOODWIN: I'll give you an example right there.
DOBBS: Going to have to be a quick one.
GOODWIN: Huckabee and Edwards would leave the middle open.
DOBBS: Huckabee and Edwards is the extremes?
GOODWIN: Yes. Of the people who have a real shot.
DOBBS: OK. That's interesting. We'll take that up, let's say Monday. Roger Simon, you've got a lot of work to do down there. Thank you for sharing part of your evening with us. Roger Simon, politico.com. Thank you, sir. Michael Goodwin, Miguel Perez, gentlemen, as always thank you both.
And still ahead the results of our poll, some of your thoughts and a great deal more, well, a lot more. Stay with us.
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DOBBS: Ninety-seven percent of you do not agree with President Bush that the economy will be just fine if Congress passes an economic stimulus package.
Time now for a few of your thoughts. Al in New York wrote in about the Mexican government fund $100 million ad campaign to promote amnesty for illegal aliens in this country. "Dear Lou. Instead of Mexico's government wasting on this bogus amnesty campaign, they should spend it creating jobs, better education and healthcare for their own people in their own country."
Doug in Alabama. "Lou, what the hell is going on? We send Mexico money to fight crime, they use it to fight us and advertise for us to keep the illegal aliens. We've got to wake up before Bush leaves office."
Scott in California. "Lou, what is next? Can we expect communist China running ads extolling the virtues of their system? It wouldn't be surprising given the state of our economy. Heck, we'd probably buy it like every other product that China exports." And Richard in Ohio. "Lou, it looks like the Democrats got their wish, at least in Nevada. Pandering to the illegals is going to pay off and that many of them will be voting in our election process. What's next, sign a paper stating you're a citizen and get a passport?"
And Scott in California. "Lou, Senator Clinton's 'no woman is illegal' may be the precursor to 'no voter is illegal.'"
Something to think about. We love hearing from you and we ask you to send us your thoughts at loudobbs.com. Each of you whose e- mail is read here receives a copy of my new book. "Independents Day, Awakening the American Spirit." The book that corporate America, the Democratic Party the Republican Party, they are just dying for you to go out and buy this book and read it and act on it.
Thanks for being with us tonight. Please join us here tomorrow for all of us, we thank you for watching. Good night from New York. CNN "Election Center" with John Roberts and Anderson Cooper begins right now. John?
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