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LOU DOBBS TONIGHT

Blistering Attack on Obama's Policies; Voters not Impressed with Obama's Overseas Tour; Senate Passing Bills in Secret?; Democracy at Risk

Aired July 30, 2008 - 19:00   ET

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


LOU DOBBS, HOST: Wolf, thank you.
Tonight a blistering new attack by the McCain campaign against Senator Obama, McCain comparing Obama to celebrities including Paris Hilton and Britney Spears.

And tonight new concerns about the integrity of our voting system, some lawmakers actually demanding e-voting machines that have no paper trails. What in the world are they thinking? We'll be telling you.

And, tonight, the FDA finally admitting in public what we've been reporting here now for a month, that Mexico is the source of the salmonella outbreak in this country. We'll have all of that, all the day's news and much more from an independent perspective, straight ahead here tonight.

ANNOUNCER: This is LOU DOBBS TONIGHT: news, debate, and opinion for Wednesday, July 30th. Live from New York, Lou Dobbs.

DOBBS: Good evening, everybody.

The McCain campaign today launched its most personal attack against Senator Obama in a new television ad, the McCain campaign calls Obama the biggest celebrity in the world and asks if Obama's ready to lead.

The Obama campaign criticized what it calls McCain's old-style politics, accusing McCain of launching false and negative attacks. But some in the media are beginning to notice Obama's increasingly presidential style. A "Washington Post" columnist today described Obama as the Democratic Party's presumptuous nominee. We have extensive coverage tonight beginning with Dana Bash, reporting from Washington.

(BEGIN VIDEOTAPE)

SEN. JOHN MCCAIN (R-AZ), PRESIDENTIAL CANDIDATE: It's wrong and...

DANA BASH, CNN CONGRESSIONAL CORRESPONDENT (voice-over): On the stump, rapid-fire attacks on Barack Obama's policies.

MCCAIN: He wants to raise your taxes to pay for bigger government. We've been doing that for years and it hasn't worked. BASH: Yet, on the air...

(BEGIN VIDEO CLIP, CAMPAIGN AD)

UNIDENTIFIED FEMALE: He's the biggest celebrity in the world.

(END VIDEO CLIP)

BASH: John McCain is now comparing his rival to Britney Spears and Paris Hilton, mocking him as a vapid celebrity.

(BEGIN VIDEO CLIP, CAMPAIGN AD)

UNIDENTIFIED FEMALE: But is he ready to lead?

(END VIDEO CLIP)

BASH: With this new ad, McCain strategists are trying to channel their frustration with the attention Obama gets into a hit on his readiness and seriousness.

VOICE OF RICK DAVIS, MCCAIN CAMPAIGN MANAGER: It's much more something you expect from someone releasing a new movie than running for president.

BASH: McCain advisers say they are convinced Obama comes across as arrogant and are trying to capitalize on that.

VOICE OF STEVE SCHMIDT, SENIOR MCCAIN ADVISER: This is a close election. We've seen much presumption from the Obama campaign.

BASH: But a new CNN Opinion Research poll shows McCain advisers may be wrong on that. Only 37 percent say they view Obama as arrogant. Pretty close to what they say about John McCain.

(MUSIC)

BASH: The Obama campaign responded to McCain's new ad by accusing him of, quote, "a steady stream of false, negative attacks. Some might say oops he did it again." This is the latest in a series of McCain attack ads against Obama.

(BEGIN VIDEO CLIP, CAMPAIGN AD)

UNIDENTIFIED MALE: He hadn't been to Iraq in years. He voted against funding our troops.

(END VIDEO CLIP)

BASH: And much sharper rhetoric.

MCCAIN: The bottom line is that Senator Obama's words, for all our eloquence and passion, don't mean all that much.

BASH: Even some of McCain's allies worry he's going too far. CRAIG FULLER, REPUBLICAN STRATEGIST: I think people have sort of sat back and maybe got back on their heels a little bit and said, gee, that's not exactly what we want to see, even those of us who are in the Republican Party.

(END VIDEOTAPE)

BASH: And this afternoon, the Obama campaign rather responded to the McCain campaign's ad. And in fact we have it right now. Let's listen to part of it.

(BEGIN VIDEO CLIP, CAMPAIGN AD)

UNIDENTIFIED FEMALE: He (INAUDIBLE) politics of the past. John McCain, his attacks on Barack Obama, not true, false, baloney, the low road, baseless...

(END VIDEO CLIP)

BASH: The McCain campaign sources say they are pursuing their current strategy here with a very specific target in mind. That is, blue collar and small-town voters whom they think are simply turned off by what one senior McCain adviser called Obama's narcissism -- Lou.

DOBBS: Thank you very much, Dana Bash reporting.

Well some in the predominantly liberal national media are beginning to question Senator Obama's presidential style that he has taken on the campaign trail. In fact, "Washington Post" columnist Dana Milbank today said Obama's long been the Democratic Party's presumptive nominee. Now Milbank is saying that he is really his party's presumptuous nominee.

Milbank saying, quote, "Obama's biggest challenger may not be Republican John McCain but rather his own hubris." Milbank notes that Obama has become what he calls a president in waiting. One example, Obama's use of a presidential-style seal of a campaign event last month, one that neglected to include E pluribus unum, by the way. Another example, Obama's newly painted Boeing 757 aircraft, sprayed with, of course, the Obama campaign slogan.

Much of the national media remains strongly biased in favor of Senator Obama. That was clear during Obama's overseas tour last week. The highly respected project for excellence in journalism says coverage of Obama's trip accounted for 51 percent of all campaign stories last week, 51 percent, and they also reported that Obama was -- what it called a significant or dominant factor in 81 percent of all campaign reports last week.

By contrast, Senator McCain was a significant dominant factor in only 53 percent of campaign coverage. Despite all of that, Senator Obama did not achieve a bounce in the polls from his overseas adventure, a bounce that his campaign had hoped for, of course. In point of fact, the latest "USA Today"/Gallup poll gives McCain a four- point lead among likely voters, 49 percent to 45 percent. Other polls also indicate Obama's grand tour failed to excite voters in this country. Voters telling pollsters that Obama's trip did not help increase his standing with them on foreign policy issues.

Bill Schneider has our report.

(BEGIN VIDEOTAPE)

WILLIAM SCHNEIDER, CNN SENIOR POLITICAL ANALYST (voice-over): It's called "lowering expectations."

SEN. BARACK OBAMA (D-IL), PRESIDENTIAL CANDIDATE: Probably a week of me focusing on international issues doesn't necessarily translate into higher poll numbers here in the United States.

SCHNEIDER: He's right. A month ago Barack Obama led John McCain by five points, now by seven, not a significant change. The trip certainly looked like a presidential tour.

OBAMA: People of the world, this is our moment. This is our time.

SCHNEIDER: Do Americans think Obama was presumptuous? Not really. By nearly two to one, the public says what Obama did overseas was appropriate for a presidential candidate.

MCCAIN: I'm starting to feel a little left out. Maybe you are, too.

SCHNEIDER: Does the public think the press coverage was too positive? Not really. Thirty-nine percent said it was too positive. But 60 percent said it was about right or too negative. The trip was intended to enhance Obama's credibility on foreign policy, particularly Iraq. But McCain still leads Obama on Iraq by about the same margin as before the trip.

But it's not because voters prefer McCain's Iraq policy, it's because McCain leads on every foreign policy issue. But, get this, Obama leads McCain on gas prices. But it's not because voters prefer Obama's energy policy. More than two-thirds want more off-shore oil drilling, which McCain supports and Obama doesn't. It's because Obama leads McCain on every domestic issue, including gas prices. McCain has been very aggressive in criticizing his opponent.

(BEGIN VIDEO CLIP, CAMPAIGN AD)

UNIDENTIFIED FEMALE: He's the biggest celebrity in the world. But is he ready to lead?

(END VIDEO CLIP)

SCHNEIDER: Do voters think McCain is attacking Obama unfairly? Forty percent do. Nearly 60 percent do not. Only 22 percent think Obama has been attacking McCain unfairly.

(END VIDEOTAPE) SCHNEIDER: So, it doesn't look like either Obama's trip or McCain's criticisms have had a lot of impact. Hey, it's summer, people are worried about other things, like how can they afford to drive to the beach -- Lou?

DOBBS: Bill, thank you very much. Bill Schneider.

Well, new indications tonight of the success of the surge strategy in Iraq. Nine of our troops were killed in Iraq over this month. That is the lowest monthly total of the entire war. Additionally, troops this month found the remains of two of our soldiers who had been missing since last year. In another indication of success in Iraq, the number of attacks dropped to just 25 a day this month, comparing with a total of 170 attacks each day just over a year ago.

President Bush today took action on another key issue. The president, signing a housing bill to rescue nearly half a million homeowner facing foreclosure. President Bush signed the bill into law early this morning, out of public view. The White House initially had threatened to veto this legislation, in part, because of a provision that grants states $4 billion to buy homes that have already been foreclosed upon.

The housing bill includes a bailout plan for mortgage giants Fannie Mae and Freddie Mac, should that bailout be needed. Another example of the supposedly free market Bush administration intervening in the market with a government bailout.

Well, still ahead here, the Senate has passed nearly all of its legislation in secret, without even the senators knowing. What's in that legislation? Did you know that? Well, how about that? We'll have that special report. The Senate probably doesn't want you to pay attention or the Republican National Committee or the Democratic National Committee, but nonetheless, we're going to tell you all about it.

In another threat to our democracy, many of those very same senators, still pushing e-voting machines that leave no paper trails for recounts, we'll have that incredible story as well and a great deal more still ahead. Stay with us.

(COMMERCIAL BREAK)

DOBBS: A bitter fight this week in Congress over the Senate's practice of passing critical legislation in absolute secret without public debate. A staggering 94 percent of all Senate legislation is passed with no debate. No discussion at all of the policy or how your tax money is spent. Tonight, one leading senator is demanding that the government become somewhat accountable to American taxpayers -- imagine that.

Lisa Sylvester with our report.

(BEGIN VIDEOTAPE) LISA SYLVESTER, CNN CORRESPONDENT (voice-over): The bickering on Capitol Hill has reached new heights. Lawmakers' ratings have reached new lows. Senator Tom Coburn says bills are being approved by the Senate without debate, without amendments, and that 94 percent of the time, without lawmakers formerly voting on the legislation.

SEN. TOM COBURN (R), OKLAHOMA: I think that fails the test of our founder's vision of a Senate. I think we will rue the day that we've gone down this path.

SYLVESTER: This week, Senator Coburn, a medical doctor and fiscal conservative, led a Republican revolt against an omnibus bill offered by Senate Majority Leader Harry Reid. That bill was full of popular measures, including increased money for unsolved civil rights crimes and for child pornography prosecutions. But it carried a price tag of more than $11 billion.

SEN. HARRY REID (D-NV), MAJORITY LEADER: They vote against Americans with Lou Gehrig disease. They voted against American mothers who suffer from postpartum depression. They vote against justice for people murdered during the civil rights struggle.

SYLVESTER: Many of those measures in the omnibus bill, Coburn says he actually supports. But the bill also included pork, money to build a museum in Poland and to set up a Star Spangled Banner commission. And Coburn says when lawmakers are merely rubber-stamping legislation, that ads to the budget deficit.

UNIDENTIFIED MALE: This is $11.3 billion worth of additional spending at a time when American families are struggling to get by that if we don't have the money, we're going to borrow it from there children and their grandchildren.

SYLVESTER: Coburn is still holding up more than 80 pieces of legislation until, he says, there's an open debate and amendment process. His stance has earned him the ire of Senator Reid and the title of "Dr. No."

(END VIDEOTAPE)

SYLVESTER: Senator Coburn's office sent out a press release, saying, quote, "whether we like it or not, the federal government's long and bipartisan era of borrowing without limits and Enron style accounting will come to an end." And Coburn added, "It's time the U.S. government lives within its means, just as every American family does every day --Lou.

DOBBS: Well, every revolution begins with one man or woman. And it appears that this revolution is certainly at the point with Tom Coburn. I mean what he's doing is both in my judgment at least clear- headed and courageous.

SYLVESTER: And many of his colleagues are actually praising him. I mean he stood up and is basically saying, raising his hand and saying no more. That this process of unanimous consent has added to the budget deficit. We just had new projected figures, $482 billion and he says at some point this has got to come to an end and he says that point is now.

DOBBS: And let's hope that somewhere, in the Senate, he finds some colleagues with the courage to stand with him, for the benefit of the country. It is also to be hoped, in addition to the fiscal responsibility involved here, Lisa, it would also be nice to think that those senators, and with that rather sanctimonious tone taken by the majority leader, Senator Harry Reid that they would actually read the legislation, as he intoned those very serious issues that some of the legislation dealt with -- any prospect of that occurring?

SYLVESTER: You know this is one of the big things that many people don't even realize, is that lawmakers often frequently pass bills and you've got pages and pages of bills and they often don't actually read those bills.

DOBBS: And all we have to do to validate that reality is to look at the consequences of what passes for public policy these days.

Thank you very much, Lisa Sylvester.

The current Senate has passed, by the way, 855 bills in secret by so-called unanimous consent, which is simply a code expression for passing it without public debate or even a vote. To put that in perspective, the Senate passed only 53 measures by an actual roll call vote. And just three measures by voice vote. The 855 measures that your senators passed without your knowledge or debate or your input cost you more than $9 billion.

Time now for our poll question: Do you believe the Senate should read more than six percent of the laws that they now pass?

Yes or no? We'd like to hear from you. Cast your vote at loudobbs.com. We'll have the results here later.

Alarming new evidence tonight of something we've been reporting here for many years. Our so-called free trade policies in this country are failing American workers. A new report finding that the United States has lost more than two million jobs to communist China alone since China entered the World Trade Organization in 2001, including 200,000 science and engineering jobs.

According to the Economic Policy Institute, those trade policies also cost American workers more than $19 billion in lost wages last year alone. The job losses have affected all 50 of our states, with California, Texas, New York, Illinois and Ohio losing the largest number of jobs.

Up next here, democracy at risk and why Congress refuses to protect the integrity of our voting system by demanding a paper trail. We'll have that report and why some leading members of Congress are calling on the president to stop enforcing U.S. immigration laws, Congressman Luis Gutierrez among them. He'll be my guest here next. Stay with us.

(COMMERCIAL BREAK) DOBBS: Coming up next, the Food and Drug Administration finally admitting what this broadcast has been reporting for a month, that this broadcast was absolutely correct in our reporting on Mexico's link to our nationwide salmonella outbreak. We'll have that story next.

(COMMERCIAL BREAK)

DOBBS: We've reported extensively on this broadcast about the unreliability of electronic voting machines without a paper record. But, now, Congress is proposing legislation that would continue funding touch screen voting machines without a paper trail.

As Kitty Pilgrim now reports, the legislation comes at a time when many states are banning that technology and moving to verifiable paper ballots.

(BEGIN VIDEOTAPE)

KITTY PILGRIM, CNN CORRESPONDENT (voice-over): A bill put forward by Senators Dianne Feinstein and Bob Bennett calls for new election security measures, audits of all elections, millions of dollars to states for new election equipment, and money for research on new voting technology. But the bill would also provide funds for touch screen voting machines that leave no paper trail. Groups that advocate a return to paper ballots are outraged.

JOHN BONIFAZ, VOTER ACTION: This bill amounts to a public boondoggle for the private companies that have marketed these flawed electronic voting machines. We're talking about the allocation of millions of more taxpayer dollars to a product that we know is unreliable in accounting and recording of voting.

PILGRIM: The bill would allow electronic votes to be counted and audited electronically.

WARREN STEWART, VERIFIED VOTING FOUNDATION: We can't have a situation in which the correctness of election results is dependent on the correctness of software because you cannot guarantee the correctness of software.

PILGRIM: For that reason, paper ballots which can be recounted easily and accurately, are gaining ground. Many states have banned electronic voting, or have laws that phase it out, including Florida, California, Iowa, Maryland, Tennessee, New Mexico, Colorado. Virginia and a handful of other states have a policy to eventually replace touch screen machines as they wear out with paper ballots.

Because of that, about half of the nation's voters will cast paper ballots this year, up from 35 percent in 2004. Senator Feinstein would prefer a bill requiring paper ballots, but could not get one passed. She calls this measure a compromise.

(END VIDEOTAPE)

PILGRIM: Now Senator Feinstein's home state has decertified touch screen voting machines and moved to a paper ballot system. Her office today explained they would like to require a paper trail in this new legislation. They have proposed bills in the past that have called for it but those bills failed, and now they have to deal with the reality of what they can get passed in Congress. That's what they say.

DOBBS: If Congress were to pass this, Congress should be run out of the nation's capital. It's bad enough that a sitting senator would introduce the legislation. This is irresponsible, unconscionable legislation, and they -- Senator Feinstein, whatever else she is, is sufficiently knowledgeable and intelligent enough to know that without accountability, anything can happen in this democracy of ours.

PILGRIM: They had a hearing today. She started it by saying, I wish we could have paper ballots, but...

DOBBS: But.

PILGRIM: ... and then they continued the hearing, talking about...

DOBBS: They should put a nail on that door, shut the room off until this little whim -- this madness passes. One would think that she would pay some attention to what's happening in her home state. Oh, I forgot, she's a sitting senator in the state of California, my goodness.

Kitty, thank you very much -- Kitty Pilgrim.

And yes, Senator Feinstein, we assure you LOU DOBBS TONIGHT will be following your every move through this new edition of utter legislative madness. We like to make those promises to certain people who always gain our attention and, of course, favor.

We should note, as well, that Congress has already spent billions of dollars on electronic voting machines that simply don't work. The Help America Vote Act was passed back in 2002 to reform this country's troubled voting system after of course the events of 2000. Just over $3 billion was allocated to help states upgrade their antiquated outdated voting systems. Much of that money went to e-voting systems that were prone to computer hacking, glitches and incorrectly recorded votes, and most of them without a paper trail. That, of course, means there could be no recount.

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

Susan in Connecticut: "As a wife, mother, and part owner of a small manufacturing business in a global economy, I want to hear what the presidential hopefuls are going to do in a political arena littered with greed, misappropriation and deceit. I would bet that many don't want either of the candidates attempting to clean up the mess the current administration will leave behind."

And Jean in Texas said: "Dear Lou, I don't want my president to be a citizen of the world. I want him to be the upholder of the Constitution of the United States and the protector and defender of the citizens of this country. Other countries elect leaders to look after their best interests. I think it's time for Americans to do the same. Now for the big question, where do we find that candidate?"

That is the question.

And Michael in Connecticut: "Mr. Dobbs, I would like to thank you. I am a 14-year-old kid in a middle class family. I know how much you despise the way the federal government is handling the issues facing our country today. Because of the absurdity of our two party system, when I turn 18, I'm registering as an Independent."

Well, I just want to say first of all thank you. And we look forward to having your vote amongst the reasonable majority in this country. We'll have more of your thoughts here later in the broadcast.

Up next, outspoken pro-amnesty Congressman Luis Gutierrez demanding the federal government stop enforcing U.S. immigration law and carrying out raids on employers -- illegal employers of illegal aliens. Congressman Gutierrez joins me.

And the Food and Drug Administration finally, finally admitting what we've been reporting here for a month, Mexico is the source of the salmonella outbreak in the United States, a congressman who today harshly criticized the FDA joins me.

Stay with us. We're coming right back.

(COMMERCIAL BREAK)

DOBBS: Welcome back.

Country of origin labeling, it's part of the farm bill that became law five years ago. There's a possibility that one day it may actually be enforced and soon. The Agriculture Department has just issued what it calls an interim final rule on the program. Country of origin labeling or C.O.L. covered meat, vegetables, some nut and herbs that come into the country. The rules go into effect on the 30th of September but in the five years that C.O.L. has been the law, it has never been funded or implemented. The food industry lobbyists and their friends in Congress have seen to that.

Well, the FDA could have traced the source of our current salmonella outbreak much earlier had C.O.L. been enforced. We'll follow this to September 30th to see what the public interest finally take precedence amongst your elected officials over special interests and the lobbyists who are nose-to-nose with them on a daily basis.

The FDA today confirmed the salmonella strain responsible for the massive outbreak across this country has been found at a second farm in Mexico. The outbreak first linked to tomatoes and then peppers has sickened 1,300 people here. It's a story this broadcast, as you know, has covered extensively. We think the number of people sickened in this outbreak could be 30,000 to 40,000 people.

David Atchison, who is the Food Safety Chief at the FDA, has finally admitted what we've been reporting for weeks, the source of the outbreak was produce from Mexico.

(BEGIN VIDEO CLIP)

DR. DAVID ATCHISON, FOOD SAFETY CHIEF, FOOD & DRUG ADMINISTRATION: We've had our investigators in Mexico. They have been investigating a specific farm, taking sample, looking for signs of the salmonella St. Paul outbreak. Two hours ago, we learned we got a positive sample in both the water used for irrigation and a sample of serrano peppers from the same farm that matched the outbreak strain of salmonella Saint Paul. This is a key breakthrough.

(END VIDEO CLIP)

DOBBS: A key breakthrough. A key breakthrough that took the agency four months to find, as I say, as many as 40,000 Americans may have been sickened. We know for a fact that more than 1,200 people were taken ill.

Congressman Dennis Cardoza chaired the meeting of that House Subcommittee of Horticulture and Organic Agriculture that Dr. Atchison was testifying before. The Congressman joins me now.

Good to have you with us.

REP. DENNIS CARDOZA (D), CALIFORNIA: Pleasure to be with you, Lou.

DOBBS: Congressman, I know that you've been following this throughout.

CARDOZA: I have.

DOBBS: And I can't imagine your frustration level. But the idea that an official of the FDA could stand there, responsible, sit there responsible, before you and your committee, and for the safety of the American people, and, frankly, just lay that out, as if the previous four months hadn't transpired. How frustrated were you today?

CARDOZA: Well, you add that in context with the fact this is not the first time FDA has testified in my committee. We have -- thought well were through this when we did the leafy green and the spinach square a few years ago.

DOBBS: Right.

CARDOZA: We told them, if they need more assistance, to ask for it, we'd provide it. But to take so long to get -- you know, they've devastated the industry. Over $300 million lost to farmers, 1,300 people sickened. Two, three or more have actually died over this. "Washington Post" had a very effective story today about a person who only had one kidney and is permanently damaged from this. It's a very serious issue. And I'm very unhappy with the --

DOBBS: And do you know -- do you know, Congressman, that the FDA wouldn't take the calls from LOU DOBBS TONIGHT reporter who's been primary on this, Louise Schiavone, because they felt I was being too harsh in my criticism of them?

CARDOZA: Well, they should listen to some of the folks who have been devastated by their lack of action.

DOBBS: Yes, but how is it we get to a point in this country where the United States Congress doesn't have enough power or influence over a government to say to its leadership, you are responsible for the lives of American people, we are serious people, and we are Americans, and we deserve -- we deserve a government that works, how complicated is that?

CARDOZA: It sounds exactly like what I told him today at the hearing. It was very frustrating.

DOBBS: What happens next?

CARDOZA: Well, we're going to continue to look at this. We're going to try to propose legislation. There's three serious pieces of legislation that would mandate food tracking. I was very disturbed today to find out that less than one-half of 1 percent of all the produce that comes across the border actually ever gets tested any way, and that doesn't get tested for everything, when they could test -- there's no background screening. We don't really know nearly enough about what's coming across the border. That's fine if -- if you don't care, but we subject our farmers --

DOBBS: It's fine if you don't live in America.

CARDOZA: But my point is, they should have to play by the same rules that we do, and that's all we ask, and our farmers need that protection. Our people need that protection.

DOBBS: Congressman, as we've reported here now for literally years, as our food imports have risen above -- have grown to 20 percent of the food in the food supply chain, our inspections have declined to, as you pointed, to less than 1 percent. 30 years ago, we were watching the FDA do 50,000 inspections.

Today, they're doing a third of that. This is a mad -- this is utter madness. This White House, is there any possibility, as a lame duck president, that they're going to do anything serious, responsible and important for the American consumer?

CARDOZA: Well, we are seeing them finally move towards country of origin labeling. As you said, it's taken way too long. Clearly, we need to -- you know this country -- our farmer prose dues some of the safest food in the world. And I think there are other countries that also produce safe foods. I don't even think that what we're seeing is fair to Mexican farmers, frankly --

DOBBS: You don't think it's fair -- Congressman, can I ask you a question --

CARDOZA: I'm sorry, but --

DOBBS: No, I have to say to you, you have been at the forefront of this, but this is not an issue about being fair to other countries, this is an issue in protecting the American consumer --

CARDOZA: I agree --

DOBBS: -- there is no other interest at all on the table here.

CARDOZA: Well, I'll just tell you that this it's unfair to our farmers, it's unfair to our consumers. I would say that one bad actor in Mexico is unfair to Mexican farmers as well because they were devastated in this. Everybody gets armed when there's a food safety outbreak. That's what I was trying to convey, Lou. Think it's a terrible situation think what's happened here is just dreadful. I think our FDA, as I said in our hearing today, just dropped the ball on this and should have done a much better job.

DOBBS: Well, we appreciate your at least providing oversight over an organization that has no leadership and no leadership with any character whatsoever or apparently any sense of responsibility to the American consumer. We hope that your oversight --

CARDOZA: We'll keep on it, Lou.

DOBBS: -- moves them to action.

Thank you very much.

CARDOZA: Thank you.

DOBBS: Congressman Cardoza, thank you very much.

Still head, a new threat, convicted felons working in our troubled mortgage industry, don't worry, we're all about free markets. We wouldn't want to interfere in a free market with regulation and oversight, we'll have that special report.

And the pro illegal alien lobby, don't worry about it, we don't need silly laws enforcing security at our borders, enforcing U.S. immigration laws, no, none of that. I'll talk with Congressman Luis Gutierrez here next.

(COMMERCIAL BREAK)

DOBBS: Federal immigration officials tonight have a new strategy to reduce the number of illegal aliens in this country. Immigration and customs enforcement says it will institute a so called self deport program. Fugitive illegal aliens who have been ordered deported can now turn themselves in during a three week period in August. Participants in the program will not be detained and will be given up to 90 days in which to put their affairs in order. ICE then will make arrangements for them to leave the country. Transportation for some will be paid for by the taxpayer.

This is a pilot program. It will run in five cities. No indications tonight of how many fugitive illegal aliens, if any, will actually show up for this voluntary program. The Congressional Hispanic Caucus today demanded an end to workplace enforcement raid until the President and Congress move forward on so called immigration reform or amnesty.

Congressman Luis Gutierrez and other members of the caucus protested workplace raids this weekend. They visited the site of a raid on an Iowa meat processing plant. Congressman Gutierrez joins me now from Capitol Hill.

Congressman, good to have you with us.

REP. LUIS GUTIERREZ (D), CONG. HISPANIC CAUCUS: Thank you for having me, Lou.

DOBBS: Let's start with workplace enforcement. These are illegal employers of illegal aliens. Why should they not have to follow the law?

GUTIERREZ: We're not saying they shouldn't follow the law. What we're saying is we need comprehensive immigration reforms. You should take all of the ingredients if we're going to be successful in enforcing our work force law.

And Lou isn't it interesting that we heard testimony from over a dozen teenagers who were working at the plant and met a man who had lost his hand. We met women who were abused sexually abused at the plant. They weren't paying them overtime, unsafe working conditions and yet the federal government indicted 393 undocumented workers there but what happened to the owners that were exploiting these workers and indeed exploiting all of us?

DOBBS: That's a good question. What happened?

GUTIERREZ: Nothing happened to them, Lou. They took 393 people and they accused them of aggravated identity theft.

Here's the interesting part of what our government did. One hundred and twenty-five of those Social Security numbers didn't exist, Lou. Simply made up. And they weren't attached to a name because you can attach any name to any social security. Actually, they were sold, from testimony we heard, by people at the meat packing plant for people to come work there.

Number one, how can you steal somebody's identity if it doesn't exist? Shouldn't the name and social security number and all of the information be the same? That isn't what happened. Surely, people were working there, undocumented, in this plant, as you suggest, and you use the word "illegally" at the plant.

But, Lou, I met -- I don't want to exaggerate, I met at least 35 women with children who are wearing these tracking devices, black ankle bracelets, who's going to feed them, Lou? They don't have a court date until next January? Why are we treating them in such a dehumanizing fashion?

DOBBS: Well, I think that's absolutely fair question. And so let me begin by asking you, why would you not, given this situation, not want us to enforce all of those laws that are designed to protect the workplace, designed to protect workers, to -- and to have every employer be required right now to sign up for E-Verify, because it's 99.5 percent -- as you know, 99.5 percent effective -- in coming up with a valid match on immigration status in this country.

Why are we not seeing that happen?

GUTIERREZ: First thing, there are still kinks to be worked out in the e-verify --

DOBBS: No, sir, it's 99.5 percent effective -- the general accountability office makes that point, not me --

GUTIERREZ: -- but there's a lawsuit --

DOBBS: Sure --

GUTIERREZ: -- against the social security officials because of bad match --

DOBBS: It's America, there's a lawsuit against everything --

GUTIERREZ: Wait, wait just one second. We are a nation of rule, of law --

DOBBS: Wait a minute, you're the one saying don't enforce the laws because you want a comprehensive immigration bill --

GUTIERREZ: That's not what I said. Yet --

DOBBS: We got the law, why not enforce it?

GUTIERREZ: I think there are some laws -- Lou, I went and saw the impact of the enforcement. What we did, is we took career criminal prosecutors, and they indicted people for things they know they hadn't done --

DOBBS: Congressman --

GUTIERREZ: -- we shouldn't use --

DOBBS: Congressman --

GUTIERREZ: -- corrupt tactics.

DOBBS: Corrupt?

GUTIERREZ: Yes, they are --

DOBBS: Wait --

GUTIERREZ: -- absolutely no evidence of --

DOBBS: Congressman, you're silting in that chair saying you don't want the law enforced until a new law is created --

GUTIERREZ: I say our immigration system is broken and until we fix our immigration system in a comprehensive -- otherwise, Lou, what we have, is we have about 90 women running around with a bracelet, dehuman -- just deplorable conditions --

DOBBS: Congressman, dehumanizing --

GUTIERREZ: Yes, that's what they're doing to them --

DOBBS: They're dehumanizing -- no, no no --

GUTIERREZ: -- Lou, the kids go to school and the other kids make fun of them and saying, your mom's a criminal, as though they were a drug dealer, some kind of thief. They were working without document nation this country. Even ICE, and according to that --

DOBBS: Congressman, I've got to get a word in -- can I get a word in?

GUTIERREZ: Lou, you know something, we're such great friends, I figure I could talk for a little while on your show.

DOBBS: Now it's my turn. My turn?

GUTIERREZ: Sure, Lou.

DOBBS: OK. Why, if we're worried about dehumanizing people, is this government not insisting that Mexico, first, behave like a nation -- a sovereign nation with respect for not only our borders, but its own, and for its own people? And why does this not -- this nation not have a mature and responsible foreign policy toward Mexico that requires it, first of all, to honor its people?

And, secondly, through our aid and our foreign policy, supports their people in Mexico? Why, if we're worried about dehumanizing people, do we tolerate this nonsense in which we allow an entire hemisphere, in point of fact, but first Mexico, to send people here, impoverished, for a better life, and create great difficulties for both countries?

GUTIERREZ: First of all --

DOBBS: If you're really concerned about dehumanizing people --

GUTIERREZ: Well, look, Lou, think that's unfair to ask if I'm really concerned.

DOBBS: I don't mean to question your sincerity, my question is why not put it in the first priority?

GUTIERREZ: Can I say the following?

DOBBS: Sure.

GUTIERREZ: I think it's our joint responsibility. I think it's a hemispheric responsibility to deal with our immigration law. I've been a proponent of e-verify, making sure we have sufficient border patrol agents, but I know that until -- look, Lou, the fact is we share a boarder between a third world country and a first world country. The largest boarder in the world between two society, one impoverished and one doing well -- that is the reality of what we have.

I join you because -- you know in 1993, I voted against the North American Fair Trade Agreement because I said what it's going to do is impoverish Mexican workers even more and it's not going to do anything for American workers. It's just simply going to make corporate America richer. That's what happened. Let's stop make corporate America -- make the dollars off American workers and the dollar off workers in its totality.

DOBBS: At least marginal agreement.

GUTIERREZ: We still not to get together, Lou.

DOBBS: We got a deal. Good to have you here.

GUTIERREZ: All right, thank you so much.

DOBBS: Up next, the federal government has a new plan to save our nation's crumbling highways. Sell them to the highest bidder. There's a solution that only your government could come up with.

And did the state of Florida leave its homeowners open to fraud? We'll tell you just who Florida allowed to become unbelievably mortgage brokers.

Stay with us. We're coming right back.

(COMMERCIAL BREAK)

DOBBS: Florida Governor Charlie Crist and three other state officials tonight are facing criticism after reports that the state allowed thousands of convicted criminals to work in the mortgage industry. Felons convicted of fraud and extortion were allowed to work with struggling homeowners.

Susan Candiotti has our report.

(BEGIN VIDEOTAPE)

SUSAN CANDIOTTI, CNN CORRESPONDENT: Former boxer Calvin Washington, who's been on disability for years for a head injury, was offered a refinancing deal to make home repairs.

CALVIN WASHINGTON, FORMER BOXER: Offered me $25,000 and they were going to fix me some handicap ramps.

CANDIOTTI: Did these people give you the money?

WASHINGTON: No.

CANDIOTTI: What did they do?

WASHINGTON: They didn't do anything for me.

CANDIOTTI: Washington, who also suffered a stroke, is among the most vulnerable mortgage fraud victims in Florida. Stung, not once but twice, lied to he says by mortgage professionals who also turned out to be convicted felons.

An eight-month "Miami herald" investigation produced stunning numbers. More than 4,000 licensed brokers who cleared background checks despite convictions for fraud, bank robbery, extortion that should have disqualified them. The paper found that more than 2,000 registered but unlicensed loan originators on the books committed financial crimes, including fraud and money laundering.

(on camera): Your reaction when you heard these statistics?

RITCH WORKMAN, PRES., FL. ASSN. OF MORTGAGE BROKERS: I was absolutely furious.

CANDIOTTI (voice-over): Florida's Mortgage Broker Association had been urging the state's regulatory agency to toughen its oversight since 2002.

WORKMAN: It devalues my license because now I can't say, hey, don't worry, I'm a mortgage broker, I've got a background check and I'm licensed and I'm educated, without the consumer thinking, well, so was that guy and that guy was a felon.

CANDIOTTI: Scott Alameda was a felon, convicted on federal cocaine trafficking charges. Even told Florida regulators about it on his broker application. It should have disqualified him. It didn't. His boss wrote on his behalf that Alameda would be an asset. His mother said the state should let him get on with his life. Alameda did before the law caught up with him.

Prosecutors say he and his partners wrote about 130 loans, pleading guilty to rip-offs totaling nearly $13 million. Florida's Cabinet is now ordering an investigation into whether its own regulatory agency allowed convicted felons in the mortgage business.

GOV. CHARLIE CRIST (R), FLORIDA: What's at work here is trust and whether or not we put people in positions of trust related to mortgages.

CANDIOTTI: When it comes to Scott Alameda, Calvin Washington's mother has a thing or two to say about trust.

UNIDENTIFIED FEMALE: I wish I could look at his face. Ooh, I would like to tell him something.

WASHINGTON: I think they just ripped me off.

(END VIDEOTAPE)

CANDIOTTI: Now, Florida's regulatory agency is under orders to come up with some new rules to keep felons out of the mortgage business. Too late for victims who lost millions and, in some cases, their homes -- Lou.

DOBBS: That's a heart-wrenching report, Susan. For Calvin, I mean what is the next step? Is there any -- is there any recourse at all? CANDIOTTI: Well, for him, he is fortunate. He had a legal service agency go to bat for him. And he was able to recover some money. So he's getting along, but obviously those people are hurting to begin with.

DOBBS: Thank you very much, Susan Candiotti. And our commendation as well to "The Miami Herald," terrific investigative reporting.

Coming up at the top of the hour, the "ELECTION CENTER" and Campbell Brown.

Campbell, tell us all about it.

CAMPBELL BROWN, CNN ANCHOR: Lou in a few minutes, the last combination we expected to see this political year, Paris Hilton, Britney Spears and Barack Obama. John McCain's campaign has put them all together in a new attack ad. We'll show it to you and debate whether it's fair or over the top.

Also, Arnold Schwarzenegger. We have an exclusive interview with the governor. We talked to him about whether or not California is ready for the big one.

And what Congress is up to right now instead of doing something about gas prices -- Lou.

DOBBS: Look forward to it, Campbell. Thank you.

And a reminder to join me on the radio Monday through Friday for "The Lou Dobbs Show." Among my guests tomorrow, Margaret Veteran, Harvey Eisen, Glenn Renwick from Progressive Insurance will be with me to discuss his company's about develop ago more efficient car. Go to loudobbs.com to find listings.

And a reminder now to vote in our poll. Tonight's question: Do you believe the Senate should read more than 6 percent of the laws they pass, as they do now?

Yes or no? Cast your vote at loudobbs.com. We'll bring you the results in just a few minutes.

Up next, you won't believe the government's latest proposal to save our crumbling highways. Only government could come up with this solution.

Stay with us. We'll be right back.

(COMMERCIAL BREAK)

DOBBS: We reported on state government proposals to sell off parts of their infrastructure to private, often foreign investors. Now the Bush administration is pushing a plan for more private investment to finance federal highway and mass transit projects.

Carrie Lee has our report. (BEGIN VIDEOTAPE)

CARRIE LEE, CNN CORRESPONDENT: Transportation Secretary Mary Peters concedes the government's way of managing the transportation network is broken. She's proposing what she calls a new, a different and a better approach to improve the transport system. Two key components, more tolls on highways, more state level leasing to the highest private bidder; bidders that may focus more on profit than public service. Increasingly, foreign-owned firms are willing to pay the most.

REP. TOM PETRI (R), WISCONSIN: People who are elected for two or four-year more terms are electing to join 20 or 30 or more year contracts, for revenue, selling off for a long period of time assets of the taxpayers who elected them. There's no value added by people coming in from Australia or other places except to insulate them from the politics of raising tolls on the traveling public.

LEE: The Chicago Skyway signed a 99-year lease to an Australian Spanish conglomerate in 2005. Car tolls have risen fivefold. A year later, the same company signed a 75-year deal for the Indiana toll road.

REP. EARL BLUMENAUER (D), OREGON: They get the right to raise the tolls. They have control about development for 10 miles on either side of that turnpike. These are things that pinch people in Indiana and I'm not certain they knew what they were getting into.

LEE: The Bush administration expects a more than $3 billion deficit for next year in the Highway Trust Fund, the main source of highway funding.

(END VIDEOTAPE)

LEE: Now, next year Congress will consider a new six-year transportation bill and it could authorize more than $400 billion in spending.

So, Lou, Transportation Secretary Peters says this Bush plan is aimed at shaping that debate. And it's going to be a big one.

DOBBS: Whatever shaping a debate means. What it means is that this administration, like the fools in Indiana, are trying to sell off infrastructure. Pennsylvania, across the -- showing some good judgment in resisting Governor Rendell there.

But the idea that some fool elected to office in any capacity, whether a congressman, a governor, state legislator, thinks he or she has the right to sell American assets -- taxpayer assets -- I mean, this is nuts.

Carrie, thanks a lot.

LEE: Sure.

DOBBS: Well, New York Governor David Paterson, speaking of the devil, is proposing selling off parts of New York's infrastructure to ease the state's budget problems. The governor says privatizing roads, bridges and tunnels could close New York's massive budget deficit. Opponents call the proposal to sell those roads, bridges and tunnels, "a fiscal gimmick."

I call them just utter idiocy.

Tonight's poll results -- only 99 percent of you say the Senate should read more than the current 6 percent of the laws they now pass.

We thank you for being with us tonight. Join us here tomorrow.

Good night from New York.

The "ELECTION CENTER" with Campbell Brown begins right now -- Campbell.