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LOU DOBBS TONIGHT

Clinton and Obama on the Offensive in Texas and Ohio; McCain in a Cash Crunch; Congressman Renzi Indicted over Land Deal; Consumer Product Safety Commission under Scrutiny; Industrial States Losing Quality Jobs

Aired February 22, 2008 - 19:00   ET

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


KITTY PILGRIM, CNN CORRESPONDENT: Thanks Wolf.
Tonight, Senators Clinton and Obama escalate their battle for votes in Texas and Ohio, both races extremely tight. The candidates are fighting for every single vote. We'll have all that, all the day's news, much more straight ahead tonight.

ANNOUNCER: This is LOU DOBBS TONIGHT: news, debate, and opinion for Friday, February 22. Live from New York, sitting in for Lou Dobbs, Kitty Pilgrim.

PILGRIM: Good evening, everybody. Senators Clinton and Obama tonight are on the offensive in Texas and Ohio. Both candidates insisting they can win their party's nomination after their showdown last night. Meanwhile, Senator John McCain faces new questions about the conduct of his campaign and the role of special interests and lobbyists. We have extensive coverage of the Democratic and Republican campaign.

We begin with Candy Crowley in the Democratic race -- Candy?

CANDY CROWLEY, CNN SR. POLITICAL CORRESPONDENT: Kitty, a solid evening for Hillary Clinton turned into a pretty rocky day at many levels.

(BEGIN VIDEOTAPE)

(APPLAUSE)

CROWLEY (voice-over): They parted well.

SEN. HILLARY RODHAM CLINTON (D-NY), PRESIDENTIAL CANDIDATE: No matter what happens in this contest, and I am honored, I am honored to be here with Barack Obama. I am absolutely honored.

(APPLAUSE)

(MUSIC)

CROWLEY: And both felt good enough about how the debate went, they did a little evening celebrating.

SEN. BARACK OBAMA (D-IL), PRESIDENTIAL CANDIDATE: I promise you, we will not just win Texas, we will win this nomination, we will win this general election.

CROWLEY: They are looking at different crystal balls.

H. CLINTON: We are going to not only pick a nominee right here in Texas, but we are going to lay the groundwork for a great campaign this fall.

CROWLEY: Daylight was less forgiving than the night. The morning papers brought news she has lost ground in her must-win states. Her lead shrinking to seven points in Ohio, a tie in Texas.

Another story about money problems questioned her campaign's spending, including a single day expenditure of almost $100,000 on pre-caucus party food. But outside the disappointing news in her political world, there was real-life tragedy. The death of a motorcycle policeman escorting the Clinton motorcade in Dallas.

H. CLINTON: We are just heartsick over this loss of life in the line of duty.

CROWLEY: A sobering tragedy, which took its toll on her day. She moved forward with the Dallas event, pitching a central theme of her campaign, her experience in a perilous world.

H. CLINTON: The president has to be ready and prepared to make decisions, sometimes in a split second. You know, I have been honored to represent all of you, traveling around the world to more than 80 countries. I know a lot of the leaders. I know a lot of the influential people in these countries.

CROWLEY: But she told an audience in Ft. Worth, it wasn't the time for politics and went to visit the dead officer's family. Campaigning in southern Texas for most of the day, Barack Obama was taking some incoming about his statement that he would meet with the new Cuban leader without a change in behavior.

SEN. JOHN MCCAIN (R-AZ), PRESIDENTIAL CANDIDATE: I think it's naive to think that you can sit down and have unconditional talks with a person who is part of a government that has been a state sponsor of terrorism, not only in the hemisphere, but throughout the world.

(END VIDEOTAPE)

CROWLEY: The Obama campaign shot back that McCain simply wants to continue with failed U.S. policy that for 50 years has not served U.S. interests or the Cuban people. In a written statement, Obama went on to say that he believes this fall American people will choose the promise of the future -- Kitty?

PILGRIM: Thanks. Candy Crowley from Austin, Texas.

As Candy reported, Senator John McCain today tried to shift the discussion away from a "New York Times" article questioning his conduct. McCain saying he wants to talk about the issues that matter most to Americans. But McCain still faces tough questions about the role of lobbyists in his campaign. Dana Bash reports from Indianapolis -- Dana?

DANA BASH, CNN CONGRESSIONAL CORRESPONDENT: Kitty, one of the golden rules of political damage control is to show you're not afraid to answer questions about a controversy, but then you try to move on. John McCain is trying to do just that.

(BEGIN VIDEOTAPE)

BASH (voice-over): At a town hall in Indianapolis, it was all about changing the subject. John McCain tried to do that with tough talk on Cuba. So tough he even suggested he wants Fidel Castro to die.

MCCAIN: As you know, Fidel Castro announced that he would not remain as president, whatever that means and -- but -- and I hope that he has the opportunity to meet Karl Marx very soon.

BASH: But on "The New York Times" story suggesting he had an inappropriate relationship with a lobbyist, which enveloped his campaign a day earlier, McCain refused to answer more questions.

MCCAIN: I had a press conference yesterday morning, I answered every question. I do not intend to discuss it further.

BASH: That, even as President Bush's spokesman attacked "The New York Times", accusing the paper of intentionally trying to torpedo GOP presidential candidates. "The New York Times" does try to drop a bombshell on the Republican nominee, said White House spokesman, Scott Stanzel. That is something the Republican nominee has faced in the fast and will probably face in this campaign.

MCCAIN: My campaign is not doing that anymore.

BASH: McCain wants to move on, but the story has turned a spotlight on the lobbyists and insiders who play key roles in his campaign. Of McCain's five top advisers, two, Rick Davis and Charlie Black are senior partners in Washington lobbying firms. Steve Schmidt and Mark McKinnon do not lobby, but work for firms that do.

MCCAIN: I'm proud to have them as part of my team.

BASH: The man running against Washington's special interests says there's nothing wrong with having advisers who lobby.

MCCAIN: It's not whether the individuals, many of whom are very honorable, it's whether a system or people have violated the trust of the people as the representatives.

BASH (on camera): One senior adviser, Charlie Black, still actively lobbies Congress while he works for the McCain campaign. Black tells CNN he helps McCain strictly on a volunteer basis, and insists he never lobbies McCain, whom he's known for 30 years, on any issue for a client -- Kitty?

(END VIDEOTAPE) PILGRIM: Dana Bash.

Senator McCain tonight also facing questions about how he will finance his campaign through the spring and the summer. Now, Senator McCain has signed up for public financing for the general election. But that agreement limits the amount of money he can spend on the primary campaign. Now, McCain has almost reached that limit, and that means he can spend virtually no money until the GOP convention in September.

Senator McCain continues to raise money, though. In fact, his fund-raising has accelerated since that "New York Times" article. In the past 24 hours, McCain's campaign has raised nearly $2 million.

A congressman from McCain's home state of Arizona has been indicted on charges, including extortion, wire fraud, and money laundering. Congressman Rick Renzi is accused of collecting hundreds of thousands of dollars in a fraudulent land deal. Brianna Keilar reports from Washington.

(BEGIN VIDEOTAPE)

BRIANNA KEILAR, CNN CORRESPONDENT: Arizona Republican Congressman Rick Renzi now facing 35 criminal charges, including conspiracy, money laundering, extortion, and insurance fraud, and the possibility of time behind bars.

DIANE HUMETEWA, U.S. ATTORNEY: Each of these are felony counts. Ten to 20 years in prison and up to a fine of $250,000.

KEILAR: The government accuses Renzi of using his official position in Congress for financial gain. Federal prosecutors say Renzi insisted that a group of Arizona land investors buy property owned by Renzi's former business partner, James Sandlin. In exchange, Renzi would make sure the investors got his congressional support for a federal land deal they wanted.

The indictment says Renzi told investors, "no Sandlin property, no bill, and promised a free pass for the land deal through the House of Representatives. Prosecutors say the deal made Sandlin $4.6 million richer, and allowed Sandlin to pay off a $700,000 debt he owed Renzi. And they allege Renzi covered up the flow of money into his personal bank account.

ANDREA WHALEN, IRS CRIMINAL DIVISION: The highly intricate investigation we are talking about today required agents to trace the flow of funds through numerous corporations and business entities and an array of personal and business bank accounts.

KEILAR: The indictment also says Renzi misused money from his business, an insurance company, taking hundreds of thousands of dollars in clients' insurance premiums and funneling the money into his campaign account. Renzi denies the charges. His lawyer issued a statement saying, "Congressman Renzi did nothing wrong. We will fight these charges until he is vindicated and his family's name is restored." (END VIDEOTAPE)

KEILAR: Renzi is not finding support from Republican leaders. House Minority Leader John Boehner called these charges completely unacceptable for a member of Congress and is urging Congressman Renzi to seriously consider if he can effectively serve in Congress -- Kitty.

PILGRIM: Thanks very much, Brianna Keilar. We will have much more on the presidential campaign later in the broadcast. And we will take a look at Texas and Ohio, the next major battlegrounds. Three of the best political analysts in the nation will join us.

The war remains a top issue in this election campaign and today there is news of another positive development in the fight to secure Iraq. The powerful radical Islamist cleric, Muqtada al-Sadr, is extending his cease-fire for another six months.

Arwa Damon reports from Baghdad -- Arwa.

ARWA DAMON, CNN INTERNATIONAL CORRESPONDENT: Kitty, U.S. and the Iraqi officials are breathing something of a sigh of relief with the announcement of the extension of the (INAUDIBLE) militia cease-fire. It's been credited by the U.S. military as being one of the main factors contributing to the reduced levels of violence, and it's also widely viewed as being a smart political move on Muqtada al-Sadr's part.

The radical cleric's militia has been blamed for much of the sectarian violence here, but now the U.S. military uses much softer language when referring to him and he's widely known for his anti- American rhetoric. But there's much speculation still as to how much control al-Sadr retains over his militia and analysts say that it is fractured, although this continuation does allow the U.S. military to continue to target what it calls rogue elements.

And while this is a welcome move, U.S. and Iraqi forces do continue to battle al Qaeda in the northern part of the country where the focus on Baghdad has pushed much of the insurgency. The U.S. is now trying to apply the same tactics to bring those Northern provinces under control. And now the U.S. might be forced to choose between two allies, as tensions escalated along the Turkish/Iraqi border.

On Thursday, Turkish ground troops backed by the Air Force launched an incursion a few miles into northern Iraq. Turkey saying it was hunting down Kurdish rebels, but the move prompted Iraqi's deputy foreign minister to say that these actions are a red line that Turkey does not want to cross. And this underscores yet another potential flashpoint in the overall effort to stabilize this very volatile region -- Kitty?

PILGRIM: Thank you very much, Arwa Damon reporting from Baghdad.

Two more of our troops have died in Iraq. A Marine was killed in combat in al Anbar province west of Baghdad. A soldier also died of an illness in the Iraqi capital. Twenty-six of our troops have been killed so far this month -- 3,970 of our troops have been killed since the war began -- 29,203 troops wounded -- 13,060 of them seriously.

Still to come, troubling new evidence our middle class is reeling from economic downturn.

Christine Romans will have the report -- Christine.

CHRISTINE ROMANS, CNN CORRESPONDENT: Kitty, look no further than your local car-repo lot for signs that America's middle class may be in distress. Those lots are full. Car repossessions are rising by double digits -- Kitty.

PILGRIM: Thanks, Christine. We look forward to that report.

Also, middle class jobs are rapidly disappearing in a state that could play a decisive role in this election. We'll have that report.

Also, the credit crunch is pummeling employers of more than half of the workers in this country. We'll have a special report on that.

Stay with us.

(COMMERCIAL BREAK)

PILGRIM: There's new evidence today that unsafe products from communist China are still finding their way into American homes. The Consumer Product Safety Commission today announced recalls of three children's products, all made in China. Magnetic dartboards, the magnets present a choking hazard, children's memory testing cards with high levels of lead paint and children's jewelry containing high levels of lead. Now some of those products have been on sale in the United States since 2001.

The nation's toy brands today proposed new, and what they call, stricter safety standards. But those new standards are voluntary. No toy maker will be forced to abide by them. Congress is also considering legislation for new safety standards that would be mandatory. The Senate is expected to take up that measure next month.

Well those recalls illustrate the utter incompetence of the Consumer Product Safety Commission. The commission's job is to keep those unsafe products from reaching our shores. And the head of that agency, Nancy Nord, is under fire for her failure to see the threat posed by products from communist China.

Louise Schiavone reports.

(BEGIN VIDEOTAPE)

LOUISE SCHIAVONE, CNN CORRESPONDENT (voice-over): Recalled this month, 64,000 Cinderella 12-volt electric ride-on toys made in China, fire hazard -- 6,600 spider-man water bottles made in China, choking hazard -- 11,000 bracelet sets made in China, lead hazard, all among hundreds of thousands of recalled product from China just this month. And here's what the head of the Consumer Product Safety Commission has to say about this U.S. trading partner. NANCY NORD, ACTING CHAIR, CPSC: The Chinese government, in particular, appears by all accounts genuinely committed to improving the quality of the products they export to the United States.

SCHIAVONE: Critics say the statement in a Washington speech is wishful thinking, at a minimum.

ALAN TONELSON, U.S. BUS. & INDUSTRY COUNCIL: As an advocate for the American people and an advocate for their safety, Commissioner Nord should be focused on holding the Chinese to results.

SCHIAVONE: With a staff of 400, a field inspection team of 85, and a laboratory of 20 product testers, by its own definition, the CPSC is overwhelmed.

NORD: There are over $2 trillion worth of products imported into the United States every year by over 800,000 importers at more than 300 U.S. ports of entry. We simply cannot inspect our way to product safety.

SCHIAVONE: A leading consumer advocacy group says that's not good enough.

JOAN CLAYBROOK, PUBLIC CITIZEN: She's not using her regulatory authority. She's using her conversational authority with Chinese officials over dinner to say that we're going to have safer products. And that's really meaningless.

SCHIAVONE: But strikingly the acting director draws a sharp distinction between trade policies and statutory safety obligations to American consumers.

NORD: Safety is not a trade issue. And we will be vigilant in making sure that imports that come into this country are safe. Again, safety is not a trade issue.

SCHIAVONE: In defense of Nord, the CPSC stated, acting Chairman Nord effectively and thoroughly enforces U.S. laws and CPSC statues and directives, not the ideals that some critics wish were laws.

(END VIDEOTAPE)

SCHIAVONE: Kitty, leaders of the U.S./China Commission charge that China has built its enormous economic growth on the backs of American consumers exporting not just products, but hazards, sickness, and in a few cases, death, even as the CPSC appeases China and U.S. business -- Kitty.

PILGRIM: Louise, this is ridiculous, trillions of dollars of imports, that's not a trade issue? That doesn't make sense.

SCHIAVONE: And another thing that Nancy Nord said in this speech in Washington this week is that China and the Chinese government, Chinese industry, really seemed to get it now. Well, let's say they do get it, which as we know, is debatable. There are five million industrial establishments in China and the Chinese government says itself that they are just beginning to modernize safety checks at these facilities. There's just no way that Americans can count on these products.

PILGRIM: Who would guess that defending Chinese producers is in her job description. Thanks very much, Louise Schiavone.

Well that brings us to our poll tonight: Do you find it outrageous that the Consumer Product Safety Commission says communist China is committed to improving the quality of the products it exports? Yes or no. Cast your vote at loudobbs.com. We'll bring you the results a little bit later in the broadcast.

Coming up next, Americans faced with losing their jobs and their homes now faced losing their cars. We'll have a special report on that.

And industrial states face a dramatic loss of quality jobs. Can they be replaced? We'll have that story.

Stay with us.

(COMMERCIAL BREAK)

PILGRIM: The nation's loss of quality jobs is hitting our industrial states especially hard. Ohio lost almost 25 percent of its manufacturing jobs last year. And the jobs the states did gain were mostly in the low-paying service sector.

Bill Tucker has our report.

(BEGIN VIDEOTAPE)

BILL TUCKER, CNN CORRESPONDENT (voice-over): Ohio is staggering under the weight of job losses, losses driven by a manufacturing sector decimated by imports. Since the year 2000, the state has lost 236,000 manufacturing jobs or one quarter of the total. American trade groups blame Chinese imports for most of the damage.

CHARLES MCMILLION, MGB INFORMATION SERVICES: When you losing manufacturing jobs to imports, it creates a downward spiral. You know you lose your manufacturing job then I lose my restaurant that's close by because I'm dependent. I lose my car dealership because you're not buying a car.

TUCKER: It's a trickle-down standstill. Construction jobs decline. Wholesalers and retailers lost jobs, so did information and financial services, according to a new study by the American Manufacturing Trade Action Coalition, which advocates changes in U.S. trade policy. In the last seven years, Springfield lost 10 percent of its jobs; Canton, almost nine percent; Dayton, almost eight percent; Mansfield, 6.5 percent; Youngstown, almost 6.5 percent. In Ohio, the issue is clear.

OBAMA: In Youngstown, Ohio, I talked to workers who have seen their plant shipped overseas as a consequence of bad trade deals like NAFTA. Literally seeing equipment unbolted from the floors of factories and shipped to China.

TUCKER: This 527 (ph) ad supporting Senator Clinton makes the point too.

UNIDENTIFIED MALE: If speeches could create jobs, we wouldn't be facing a recession.

TUCKER: There was some job growth in the health services sector, restaurant, and bars too, but the kind of work vulnerable to economic weakness. The government also created jobs largely in education and in prisons. But the people of Ohio are hurting and want presidential candidates to understand they want to work.

REP. MARCY KAPTUR (D), OHIO: We want to be able to provide a living wage for our families again. Not just living off of imports coming in here, but producing here in the United States. That's what we would like the presidential candidates to address. Ohio is waiting for that, from any of the candidates.

TUCKER: And they've all been invited to tour the state with Ohio's congressional delegation.

(END VIDEOTAPE)

TUCKER: Now Congresswoman Kaptur says that as of yet, none of the candidates have responded to that invitation, probably because it would take the contenders not to mega rallies, but Kitty to quiet meetings, where those reports and those numbers would be replaced by people and families and it would be more than a photo-op. Kaptur and the congressional delegation want them to see what the reality of policy is out there.

PILGRIM: Well I guess you can take comfort from the fact that it's being talked about on the campaign trail now, but that doesn't create jobs.

TUCKER: Exactly.

PILGRIM: Thanks very much, Bill Tucker.

Well time now for some of your thoughts.

Mark in Texas wrote to us: "Is Nancy Nord aware that she is head of the Consumer Product Safety Commission rather than the Manufacturer Protection Safety Commission?"

And Rick in Pennsylvania wrote: "Lou, after looking at the presidential candidates and the policies, especially on illegal immigration I hope there is the option of none of the above to choose. The only loser in this election will be the middle class. Love your show; keep up the great work of keeping us informed."

We will have more of your e-mails a little bit later in this broadcast. Each of you whose e-mail is read here receives a copy of Lou's new book, "Independents Day: Awakening the American Spirit."

The Homeland Security Department today officially took control of a 28-mile section of virtual fence designed to protect our border with Mexico. DHS says it will have 670 miles of physical and virtual fencing completed this year. The Secure Fence Act of 2006 called for 700 miles of physical fencing along our 2,000-mile-long border with Mexico.

Senators Clinton and Obama both supported that law, but in last night's debate, Senator Clinton said the policy should be reviewed. Senator Obama said he would reverse the policy and would rely on increased border patrols and high-tech surveillance.

Coming up, troubling new evidence our middle class is on the brink of financial collapse. We'll have a special report.

Also, the credit crunch is worsening. Our economy's ability to create well-paid jobs is at risk.

And the presidential campaign could be a tipping point. The next few days could determine who will win the Democratic nomination. Three top political analysts will join us, so stay with us.

(COMMERCIAL BREAK)

PILGRIM: Tonight, the millions of middle class families already struggling to save their homes from foreclosure are also struggling to save their cars. Auto repossessions are nearing their highest level in a decade. Over the past year, auto repossessions are up 10 percent. Christine Romans reports.

(BEGIN VIDEOTAPE)

ROMANS: Meet Art and Cyro. Repo men, on their way to repossess a truck from an owner four months behind on payments. They'll take it back to Art Christiansen's repo lot. Like many across the country, full to capacity with vehicles Americans couldn't pay for.

ART CHRISTENSESN, COMMERCIAL SERVICES CORP.: They over finance with their homes, they over finance with the cars, over finance with the credit cards.

ROMANS: Like homes and credit cards, defaults on auto loans are skyrocketing. And car repossessions at this lot are up 25 percent to 30 percent. On all kinds of cars, including luxury vehicles.

Ratings agency, Fitch, sees rise in defaults not only on riskier sub prime car loans, but also on traditional prime loans, made to buyers with good credit. These defaults, a combination of loose lending, a weakening economy, and job losses. So repo lots are filling up as repossessions rise.

TOM WEBB, MANHEIM CONSULTING: We were up 10 percent in 2007. Probably up another seven percent to 10 percent this year, which would bring us up to the highest level in a decade. ROBERT MANNING, ROCHESTER INST. TECH.: And it shows us how severe the downturn in the American economy is becoming, that people are having to make a decision about whether to be able to afford to pay their car note or not.

ROMANS: The bottom line, people took out car notes they couldn't afford and lenders freely gave them.

MANNING: The reality of it is, of course, is that the consumer has to be responsible for their actions, but now we're going to find out where were the regulators and why were lenders making loans that they knew could not possibly be repaid?

ROMANS: The owner of this repoed truck said he just got behind in his payments.

CYRO MIRANDA, COMMERCIAL SERVICE CORP.: Today or tomorrow he's going to make his payments, pay the late fees, and he'll get his car back.

ROMANS: And that's exactly what he did.

(END VIDEOTAPE)

ROMANS: Of course, losing a car is the height of financial distress. For many, this is the ride to work. It's not just auto loans increasingly in trouble, Kitty. Credit card and student loan defaults are also rising right now.

PILGRIM: That's a very disturbing trend. Thank you very much, Christine Romans.

Well, the employers of more than half the workforce in this country, America's small businesses, are now being dragged into the mortgage and credit crisis. Tightened standards for loans and increased credit card interest rates are adding up to a bleak future for many who plan to strike out on their own.

(BEGIN VIDEOTAPE)

PILGRIM (voice-over): After 30 years in banking, small business owner Marilyn Landis now owns a financial consulting company. She's advising a client this week in New Hampshire. She runs a seven year old company with ten employees. But constant business travel expenses and a computer upgrade pushed her credit to the limits.

MARILYN LANDIS, SMALL BUSINESS OWNER: It's all billable, client pays me back, but my credit card balances have tripled, just simply with the amount of travel. Another credit card company, because my balances have gone up, it triggered an increase in interest rate of 20 percent in one credit card and another credit card reduced my credit line by half.

PILGRIM: About 30 percent of U.S. banks have toughened their small business lending standards, and 80 percent have tightened credit for commercial real estate loans. KAREN KERRIGAN, SMALL BUS. & ENTREPRENEURSHIP COUN.: The situation has become much, much more difficult. Whereas two years ago, where an individual may have used the equity on their home, that was good enough collateral to start a business, now banks are saying, look, that's not good enough. You not only need good collateral, but you also need a really solid business plan, and probably a flawless credit score as well.

PILGRIM: There is new evidence people are giving up their plans to start or expand a small business. And that is a problem for middle class Americans. More than 90 percent of new jobs in this economy are created by small businesses. But one in five banks reported a drop- off in inquiries for business credit over the last three months. And government-backed small business loans are down 14 percent from this time last year.

(END VIDEOTAPE)

PILGRIM: The small business association tracks the number of new loans to small businesses. The government backed lending program is the largest single source of long-term credit to businesses in the country. And new express loans in that program have fallen 23 percent from last year's levels.

Coming up, voting on primary day in Texas may not be as simple as one person, one vote. We'll have that story for you.

Also, Senator McCain defends his character and says he's putting questions about his conduct behind him. We'll ask our panel of leading political analysts if McCain can actually do that.

Stay with us.

(COMMERCIAL BREAK)

PILGRIM: The Texas primary is a must-win for Hillary Clinton, according to analysts and even her own camp. But the Texas primary process has some bizarre twists and turns that may benefit Barack Obama.

Bill Schneider reports -- Bill.

WILLIAM SCHNEIDER, CNN SENIOR POLITICAL ANALYST: Well, Kitty, here in Texas they have a unique system for picking delegates. I call it the Tex-Mex plan.

(BEGIN VIDEOTAPE)

SCHNEIDER (voice-over): Tex-Mex restaurants have these things call combination plates, where you get a little bit of this and a little of that. Same way Democrats pick delegates in Texas.

PAUL BUNKA, "TEXAS MONTHLY": We have 126 by election, 67 by caucus, and 35 more are what they call P-L-E-Os, which are party leaders and elected officials. SCHNEIDER: The 37 page menu, officially called the Texas Delegate Selection Plan explains how it works. First, there's a primary, the results are determined by state senate district. Simple, not so much.

BUNKA: The senatorial districts do not all have the same number of delegates chosen. The ones with big Democratic turnouts get up to eight and the small ones can be as low as two.

SCHNEIDER: Hillary Clinton is expected to do well in low turnout Latino districts. Those districts elect fewer delegates than high turnout African-American districts, where Barack Obama is likely to be strong. But the primary is only the first step.

WILLIAM JEFFERSON CLINTON, FORMER PRESIDENT OF THE UNITED STATES: Texas is the only place in America where you can vote twice in the same election without going to jail.

SCHNEIDER: On primary night, voters are supposed to go to precinct caucuses, where they can vote again to select more delegates.

BUNKA: You vote in the primary, but then you have to have the motivation to go back at 7:15 to the site of the primary where your precinct election was held and vote for your candidate. And it may be a long evening.

SCHNEIDER: Who runs the caucuses? The guys says if no precinct captain shows up, it's whoever gets there first. Imagine Clinton and Obama voters rushing to grab control. It's enough to give you the same thing you could get from a combination play. Heartburn.

(END VIDEOTAPE)

SCHNEIDER: And one more thing. In section one, part B, paragraph three, item a of Texas's delegate selection plan, it says, "participation in Texas's delegate selection process is open to all voters who wish to participate as Democrats, and that includes independents, who tend to like Barack Obama, and Republican s, who may want to vote to stop Hillary Clinton -- Kitty.

PILGRIM: Bill, I'm glad you sorted that out for us. Because it is complicated. But could it all in end in Texas? I guess that's the question.

SCHNEIDER: Well, the idea. Texas could be the end game. Hillary Clinton's own husband and other advisers say she has to win Texas and Ohio. If she does, she'll be the nominee. If she doesn't win them both, she won't be the nominee. What happens if she wins, but by narrow margins? She'll be behind in delegates.

If that happens, she will find it, I think, useful to trying to on, because she'll claim, we've stopped Barack Obama's momentum. But then she has to catch up in delegates. But if she loses Texas, it's going to be tough -- Kitty.

PILGRIM: Thanks very much. Bill Schneider. Thanks, Bill. Now, for more about the upcoming Texas primary, also about last night's Democratic debate, and all the week's political news, we have three of the smartest political minds in the country.

Pulitzer Prize winning columnist for the "New York Daily News" and LOU DOBBS TONIGHT contributor, Michael Goodwin. Syndicated columnist, and LOUD DOBBS TONIGHT contributor, Miguel Perez, and New York Bureau Chief for the "Washington Post," Keith Richburg. And thank you all for being here.

You know, we just went through this highly complicated. I hope you followed this. Let's look at the poll numbers for Texas. I think they would be very instructive. And it looks pretty much like a dead heat. We have Clinton at 48 percent and Obama at 47 percent.

Miguel, give me your quick answer on that.

MIGUEL PEREZ, SYNDICATED COLUMNIST: I think Obama has the momentum. I think he's going to surprise everybody in Texas. I think that the Hispanic vote that everybody's attributing -- or assuming is going to the Clintons, I think has been shifting gradually toward Obama and I think he's going to surprise everybody in Texas.

PILGRIM: A big race, 193 delegates. Michael.

MICHAEL GOODWIN, "NEW YORK DAILY NEWS": Right. Well, there has been a pattern throughout the last group, 10 states or so, where she tends to have a lead, and then he wins before that and the polls begin to shift as the campaign moves to that state. We've already seen some of that in Texas. She had a 10-point lead, at one point, maybe more than that, a couple weeks ago, it was ten points. Now it's tied. I didn't think he did very well in the debate last night, so I suspect that will help him as well.

PILGRIM: We'll get to the debate in a second, Keith.

KEITH RICHBURG, "WASHINGTON POST": I agree with that. That "Washington Post-ABC" poll had some ominous news for Hillary Clinton just because she was ahead by double digits a couple of weeks ago and now they're essentially tied.

PILGRIM: What about this less than five percent gain, if she's less than five percent win?

RICHBURG: That's the huge problem for her. Even if she wins, you know, by a narrow margin, she would have to win by a landslide blowout to accumulate enough delegates to overtake him. So, even winning for her, although, you know, it gives her bragging rights and she can complain she stopped her momentum, she's going to have to make up something like 150 delegates before she can actually claim that it's a real tie.

GOODWIN: Well, also, what's going on in the meantime, because of this momentum, the superdelegates, a few have abandoned her. Some of the undecideds are going with him. So, in the period where she can't do anything, she can't win until March 4th, she's still losing superdelegates during this time.

PILGRIM: And there's been a request by her campaign, if you're not --

GOODWIN: Right, freeze it.

RICHBURG: Freeze it.

PILGRIM: Just wait. It seems fair enough, right?

GOODWIN: Well, there's no reason why people - I mean, maybe the delegates from Texas. But those who have been in states that have already voted, there's no requirement. That's the whole thing. There are no rules.

PILGRIM: That makes good sense. Let's take a look at Ohio while we're at it. Because this is the one-two punch here. And we have Clinton just slightly ahead, 50 percent to Obama's 43 percent. There's a Cleveland debate coming up. Big economy, health care issues. That's very important to this group. Some suggested that this area may be, especially Cleveland, maybe be Hillary country because of sort of the blue-collar workforce there. Next 10 days are key, right, Miguel?

PEREZ: Yes, especially in Ohio with the teamsters endorsing Obama. I think that may shift things around toward Obama. But in response to what some of my colleagues here were saying, if Hillary manages to win by a very narrow margin in Ohio and Texas, Obama still has the lead, and then it drags into, probably into the Democratic convention, and that's what they want to try to avoid. They don't want to leave it up to the superdelegates. They don't want to leave it up to Michigan and Florida. Because then it's really going to get ugly.

PILGRIM: What's on Ohio. Michael?

GOODWIN: Well, I agree with Miguel to the extent that nobody wants to superdelegates to make or break a tie. But in fact they're going to. There's no way either one can get a majority without the superdelegates. So it's just a matter of how and when you get there. Ohio is clearly key. I mean, I think that -- one problem for the party is that it doesn't want to have a nominee who's lost the last couple of primaries, the last big ones, anyway.

PILGRIM: Right.

GOODWIN: So if she does beat him, then he is wounded in that way and it will keep it going forward. It may not give her the delegates she needs, but they'll have to go forward because the party wants to winner to come into the convention as a winner, not as a wounded leader.

PILGRIM: Yes. And this divided convention could be very destructive. Go ahead, Keith.

RICHBURG: Absolutely. I was going to say, you know, Ohio has almost the same exact demographics as Wisconsin, except bigger. And that's a state that she should have won. Ohio is a state that she should win. You've got blue-collar workers there. You got unemployment, a lot of union members, a lot of older Democrat there. You know, it just doesn't look good because Wisconsin should have been her state and it wasn't.

PILGRIM: The seniors are mostly for Clinton, though?

RICHBURG: Well, they should be for her, but we'll have to see if that maintains. She's been able to hold on to them, that's pretty much been the only group she's been able to hold on to. We'll just have to see whether his momentum is now so much with the teamster's endorsements, with all these superdelegates coming out, whether she's going to get swamped on March 4th.

PILGRIM: You know, another big issue in Ohio, as we're talking about Ohio's health care issue. Clinton has a slightly more detailed plan. Obama's plan would leave out many Americans. Does she have an advantage over that? Because health care after all is one of the biggest issues, especially in Ohio.

PEREZ: I think when they discuss the intricate details of both plans, basically they confuse all Americans. Nobody understands anything about what they're talking about. They really need to clarify things.

GOODWIN: Yes. I think there's some weakness in her plan in the sense of a mandate and the issue of how it would be enforced. How you would basically penalize somebody who chooses not to buy health insurance, even if they can't afford to. So, this is a very complicated subject, and its pure complications, as Miguel said, scare people so much, that even if it's a good plan, it might not, you know, get any traction. And don't forget, it still has to get through congress. So, the notion that if we get Hillary we're getting the plan, uh-huh.

PILGRIM: It's such an emotional issue.

RICHBURG: And just to add on that too. I agree with everything there. You know, the one thing that struck me from that debate last night is they basically agree on health care. They basically agree on immigration. They basically agree on economic policy. She tries to say there are these great fundamental differences between them, there aren't really.

So, people are voting, do you like Hillary, or do you like Barack Obama? Who do you think can actually inspire people, implement the change, or is her experience more important? More people aren't going to vote on the health plan.

PILGRIM: Let's try to bring back the issues. We'll have a couple more issues when we go -- we'll take a break and have more with our panel coming up.

First, "Election Center," coming up at the top of the hour. John Roberts joins us now. John, what are you working on?

JOHN ROBERTS, CNN, ANCHOR: Hey, Kitty. Thanks very much. CNN "Election Center" coming up at the top of the hour. We are looking tonight at how the Clinton campaign is spending its money. Nearly $100,000 for sandwiches, $13,000 for pizza, and $5 million for consultants in one month. John McCain may not be having trouble raising money right now, but we'll tell you why he could at least hit a wall when it comes to spending it. See you at the top of the hour with that and other stories on the political front. Kitty.

PILGRIM: We look forward to it, John.

A reminder now to vote in tonight's poll. Do you find it outrageous that the Consumer Product Safety Commission says communist China is committed to improving the quality of the products it exports? Yes or no. Cast your vote at loudobbs.com and we'll bring you the results in just a few minutes.

Also, up next, much more with our panel. So stay with us.

(COMMERCIAL BREAK)

PILGRIM: We're back with our political panel. You know, one of the things that's very important to Americans, and we've seen it in poll after polls is immigration, both candidates -- both Obama and Clinton addressed it in the debate. Let's take a quick listen to that.

(BEGIN VIDEO CLIP)

SEN. BARACK OBAMA (D-IL), PRESIDENTIAL CANDIDATE: We have to require that undocumented workers who are provided a pathway to citizenship, not only learn English, pay back taxes, and pay a significant fine, but also that they're going to the back of the line. So that they're not getting citizenship before those who have applied legally.

SEN. HILLARY CLINTON (D-NY), PRESIDENTIAL CANDIDATE: We need a path to legalization, to bring the immigrants out of the shadows. Give them the conditions that we expect them to meet, paying a fine for coming here illegally, trying to pay back taxes over time, and learning English.

(END VIDEO CLIP)

PILGRIM: Now, Senator Clinton said she would introduce this amnesty agenda in the first 100 days in office.

Your reaction, Miguel?

PEREZ: That was new. That was the only thing that was new in that whole debate regarding immigration. Because their positions are pretty similar. I pointed that out to Lou on this program yesterday that they do have some differences. I think Obama has been the straight talker on immigration, where Hillary has wavered a couple of times.

But you know, after I did that, a few of the viewers here sent me a few e-mails, saying I'm definitely on Hillary's and I'm biased and all that. And I've got a surprise for them. I think Obama lost me on the debate last night when he talked about Cuba.

PILGRIM: Cuba. We'll get to Cuba in a second. Immigration first.

GOODWIN: Well, the thing that struck me last night. The difference between them. They're very similar on the path to legalization. Obama did say, we have to do something about the influx of undocumented workers. She flip-flopped on the fence.

Now, I interviewed her in April of 2006. She was a very big on the fence at the time, necessary part of any package. They both voted for it. Last night, she said, maybe a fence is appropriate in some cases. That's a big change. And of course, in Texas, it's a big issue.

PILGRIM: Yes. It's fairly clear they're trying to play it politically. Keith.

RICHBURG: Right. Just one thing I would add, I thought that when Obama mentioned, and he was the only who mentioned this, we have to do something to get Mexico and get their economy moving again so people don't come. I just thought that was a very effective and it shows he was trying to link it as a foreign policy issue and not simply an immigration issue here.

PILGRIM: Miguel brings up Cuba, and you know, this sort of how do you deal with rogue nations like Cuba. Miguel.

PEREZ: Well, you know, I'm a Cuban-American, first of all. So, you know, he lost me and I think he lost all of south Florida last night when Obama said that he would unconditionally deal with whoever succeeds, you know follow Castro. I think it's - McCain called it dangerously troublesome or something.

He used a word to describe this. Basically, I agree with McCain. I think it's a very naive, dangerously naive, extremely naive to just meet with these people without getting something in return. You need something in return. Elections, free the prisoners, do something toward democracy if you're going to go meet with them.

PILGRIM: Yes. This is a charge against Obama, that he's naive in dealing with rogue nations.

GOODWIN: And this is right up in McCain's window. I mean he loves this. This is a perfectly tailor-made thing for McCain in the general election. Hillary can't really make that argument. When she comes up to the plate and then walks away from it because she and Obama are going for the same voters. But with McCain, it's a way of really shaking the independents and uniting the Republican base.

PILGRIM: OK. Keith. RICHBURG: I thought that was the one clear distinction between them. Where he made the statement, and it really struck me, where he said, I think it's arrogant for the U.S. president to say, you have to earn a meeting with me. I think we should just go meet with anybody without preconditions. Clear difference between him and Clinton.

PILGRIM: Very, very striking. But we have to end it there.

Michael Goodwin, Miguel Perez, Keith Richburg. Thank you, gentleman.

Still ahead, "Heroes," our weekly tribute to our men and women in uniform. And tonight, an airman honored for valor in Afghanistan. Stay with us.

(COMMERCIAL BREAK)

PILGRIM: Time now for "Heroes." It's our weekly tribute to our men and women in uniform. Air force Technical Sergeant Jason Dryer was badly wounded in Afghanistan, but not before he earned the Bronze Star for valor. Katherine Barrett has his story.

(BEGIN VIDEOTAPE)

KATHERINE BARRETT, CNN, CORRESPONDENT: You'll never here air force Technical Sergeant Jason Dryer complain. But the shrapnel injuries for which he's receiving the Purple Heart makes standing at attention painful. Drier is also receiving a Bronze Star with Valor. The honors put the discomfort in perspective.

TECH. SGT. JASON DRYER, U.S. AIR FORCE: They have a lot of meaning for me, because I'm part of history now. I'm part of those guys that came out of certain conflicts and they get awarded and you just belong to that -- a part of that brethren.

BARRETT: Dryer's brotherhood is the tight knit core of Air Force special operations combat air controllers. During his heaviest action in Afghanistan last April, Dryer coolly called in air power beating back wave after wave of insurgent attacks.

UNIDENTIFIED MALE: With the team pinned down, Sergeant Dryer directed 40-mm gunfire from an AC-130 against the cave complex, annihilating the cave and its inhabitants. Throughout the engagement, Sergeant Dryer provided unprecedented terminal attack control that proved decisive to countering the enemy's lethal intent.

BARRETT: Special operations airmen are proud to be quiet professionals, recalling the day a road side bomb blasted him 35 feet through the air. Dryer is softer spoken than most.

DRYER: We had already gone through 36 hours of work and had barely minimum sleep. So, we're heading back. It was a long, arduous process over rough terrain. And when we we're turning back to my friend and said, I can't wait for this to be over. I turned back and I don't remember anything else. I woke up in my friend's arms with all my clothes cut off, all bloody and what not. BARRETT: Medivac back to Kandahar, Dryer suffered serious leg wounds and other injuries but refused to stay sidelined.

LT. COL. JEFFREY STAHAN, U.S. AIR FORCE: About 10 days after he was wounded, all he wanted to do is get back in the field and get back in the fight with the men. It was amazing to me as commander to go out there and pin that. And he was limping around and just as I was leaving, he was getting on a gun jeep to go out and do another mission. It was amazing to see.

BARRETT: And despite the thug of family ties, Airman Dryer wants nothing so much as to get his knees fixed and march back to battle.

Katherine Barrett, for CNN, at McChord Airforce Base, Tacoma, Washington.

(END VIDEOTAPE)

PILGRIM: We wish him the very best.

And now the results of tonight's poll -- 94 percent of you find it outrageous that the Consumer Product Safety Commissions says communist China is "committed to improving the quality of its products it exports."

Time now for some more of your e-mails. And thousands of you are sending us your opinions about the NAFTA super (AUDIO GAP) that will cut through Texas. It's known as the Trans-Texas Corridor.

Barbara in California wrote: " Lou, the state of California recalled a governor who wanted to override the voice of the people. Now we will see if the state of Texas has the same courage."

And Barry in Pennsylvania wrote: "Dear Lou, I just wonder how many politicians will lose their property due to 'Eminent Domain' for the NAFTA superhighway. If I was a betting man, I'd have to say none!"

Daryl in Florida: "Lou, the Democrats and Republican s are running this nation like corporate America runs their companies...right into the ground."

And Rita in Virginia wrote: "Lou, I have been an Independent for over 30 years. I am glad I finally have some company, but this year I believe it doesn't matter what party your affiliation is, we still have very poor candidates to choose from."

Lou in Pennsylvania wrote: " Lou, my wife has been an Independent for years -- the intelligent one in the family. If this year's batch of candidates is the best organized political parties have to offer for the highest office in the country, I'm declaring my Independence as well. She's been right all along. Thanks, Lou, and keep up the good work."

Well we love hearing from you. Send us your thoughts at loudobbs.com Each of you whose e-mail is read here receives a copy of Lou's new book, "Independence Day: Awakening the American Spirit."

Thanks for being with us tonight. Please join us tomorrow. For all of us here, good night from New York.

The "Election Center" with John Roberts starts right now -- John.

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