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LOU DOBBS TONIGHT

Executive pay cap; Stimulus Showdown; Buy American?; Health Care for Children; Broken Borders

Aired February 4, 2009 - 19:00   ET

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


LOU DOBBS, HOST: Thank you, Wolf. Tonight, President Obama launches a high-profile effort to crack down on corporate greed and excess. Will it be enough? We'll have complete coverage for you tonight.

Also, President Obama, again using fear mongering to try to break the deadlock over that massive borrowing and spending bill, warning of economic catastrophe if the Senate and the House do not pass that economic stimulus package.

And tonight the Obama administration also refusing to support ""Buy American"" provisions in both the House and the Senate, that so- called stimulus bill will apparently be without that American worker support. What in the world has the White House decided -- all of that, all the day's news and much more straight ahead here tonight.

ANNOUNCER: This is LOU DOBBS TONIGHT; news, debate and opinion for Wednesday, February 4th. Live from New York, Lou Dobbs.

DOBBS: Good evening, everybody. President Obama today declared he will limit the compensation of executives whose companies receive taxpayer bailout money in the future, limit that money to $500,000, President Obama again saying that greed and excess on Wall Street is utterly shameful.

But the executive pay limits will not apparently apply to any of the firms that have already received tens of billions of dollars in taxpayer money. Many are saying the president's announcement today is simply politics. Dan Lothian has our story from the White House.

(BEGIN VIDEOTAPE)

DAN LOTHIAN, CNN WHITE HOUSE CORRESPONDENT (voice-over): It's the new price of asking for federal bailout money. Your top executives will get a pay grade downgrade.

BARACK OBAMA (D-IL), PRESIDENT OF THE UNITED STATES: What gets people upset and rightfully so are executives being rewarded for failure, especially when those rewards are subsidized by U.S. taxpayers, many of whom are having a tough time themselves.

LOTHIAN: Under a plan to rein in outsized salaries and bonuses, Mr. Obama and his Treasury secretary, Timothy Geithner, said senior executives from the most distressed companies can't make more than $500,000. Stocks to boost salaries can't be sold until all bailout money is paid back. Big spending on jets, office renovations and holiday parties must be reported. And shareholders will have more say in executive pay.

TIMOTHY GEITHNER, TREASURY SECRETARY: Economic recovery will require restoring confidence in the leadership of these institutions.

LOTHIAN: AIG, Bank of America and Citigroup, which have received billions in bailout money, don't fall under this plan. Only banks negotiating future agreements with the government will be restricted. But this appears to be built on an honor system. And White House press secretary Robert Gibbs had a hard time explaining how enforcement would work.

ROBERT GIBBS, WHITE HOUSE PRESS SECRETARY: Let me get -- I will get clarification from Treasury on that.

LOTHIAN: Compensation experts say this move will play well on Main Street, but not Wall Street.

DAVID SCHMIDT, EXECUTIVE COMPENSATION EXPERT: Anytime you have an outside influence, in this case, the government, determining what pay should be, can always be a little problematic.

(END VIDEOTAPE)

LOTHIAN: And Lou, you saw how Robert Gibbs said that he wanted to get more clarification from the Treasury Department. I can tell you after attending a briefing with senior administration officials, it really does appear to be an honor system where companies will put the information out there on the Internet. They'll provide some transparency for the public. Lou.

DOBBS: Well self-regulation worked so well on Wall Street, why not try it again, right? Unbelievable.

LOTHIAN: Yes, that's the criticism. But you know what, Robert Gibbs points out is that you had the revelation of the million-dollar renovation of that office. You had that pricey jet, that order that was canceled. He said this was not something that was not brought about by any rules or regulations. This was something that the story got out there through transparency that the media picked up on it, the public went wild and executives decided to make some changes.

DOBBS: Yeah, I think that the bully pulpit is a good place to start but real teeth will be required to change a lot of very different imperatives in corporate America. I loved your, Dan, the executive compensation expert who thought it might be problematic if the government interferes in compensation. I wonder how problematic it is when the taxpayer interferes and saves Citibank and Citigroup, AIG, Bank of America and all these other institutions. They didn't seem to think that was too problematic, did they?

LOTHIAN: Well, and certainly people out there who see their tax dollars going out the door every day and they're still trying to save their home and save their jobs will think the same as well.

DOBBS: Yeah, absolutely, Dan, thanks a lot.

LOTHIAN: OK.

DOBBS: Dan Lothian from the White House. Well, executive compensation has soared in recent years in corporate America. Many CEOs are being paid 400 times more than their front-line average employees. CEO compensation at the three companies receiving the greatest amount of bailout money illustrates the scale and the scope, the dimension of the problem. Bank of America CEO Kenneth Lewis earned nearly $25 million for a year's work back in 2007.

AIG's then CEO Martin Sullivan, well, he got more than $14 million that year, and Citigroup CEO Dick Rumpandant (ph) earned just over $3 million. But we should point out he was only appointed CEO in December of 2007. President Obama and other top officials are blatantly accusing, blatantly using the politics of fear to push for even more so-called stimulus measures.

They want that bill in the Senate passed without any scrutiny, without any thinking. British Prime Minister Gordon Brown today topping Barack Obama, however. Gordon Brown saying the world is in depression. House Speaker Nancy Pelosi had her own contribution to hyperbole today. She said 500 million Americans lose their jobs every month. She misspoke of course, the total is about a half a million in December and President Obama today warning about the danger of an economic catastrophe.

(BEGIN VIDEO CLIP)

BARACK OBAMA (D-IL), PRESIDENT OF THE UNITED STATES: A failure to act and act now will turn crisis into a catastrophe and guarantee a longer recession, a less robust recovery, and a more uncertain future. Millions more jobs will be lost. More businesses will be shuttered. More dreams will be deferred.

(END VIDEO CLIP)

DOBBS: The Obama administration is just a little over two weeks old, and it appears already that the politics of hope have given way to the rhetoric of fear. It is my opinion, frankly, time to start talking down our economy, for our political leaders to stop using fear mongering to pass economic legislation and to insist on more thinking and a lot less rhetoric.

The $1 trillion borrowing and spending plan masquerading as stimulus tonight is in deep trouble in the Senate. Senators from both parties are scrambling, they say, to save this plan. President Obama is pushing those senators to pass the legislation before Presidents Day. Dana Bash has our report from Capitol Hill.

(BEGIN VIDEOTAPE)

DANA BASH, CNN SENIOR CONGRESSIONAL CORRESPONDENT (voice-over): Three centrist senators invited for one-on-one meetings with President Obama about his stimulus package. Each came out saying he heard their concerns loud and clear. Cut excess spending or lose their votes.

SEN. OLYMPIA SNOWE (R), MAINE: He understand that there have been issues, concerns and opposition to a number of the initiatives included in the stimulus plan, and that's why he's prepared, and his team is prepared, to work with members of both sides of the political aisle.

BASH: Snowe handed the president a list of spending programs she wants out because she says they don't create jobs. Things like $6 billion for federal building renovations and $1 billion for the Census Bureau. Snowe's GOP colleague from Maine, Susan Collins, has been in a flurry of meetings with Republicans and Democrats who want to scrub excess spending from the near $900 billion bill.

SEN. SUSAN COLLINS (R), MAINE: He recognizes that some of the provisions that were added in the House and some in the Senate as well do not really belong in the bill.

BASH: The White House knows that without Snowe and Collins support, a stimulus bill is not likely to pass the Senate. But the reason Mr. Obama and Democratic leaders are suddenly so eager to negotiate is because a growing number of fellow Democrats want changes, too. In fact, more than a dozen Senate Democrats met Monday night to discuss a bipartisan amendment to slash some $50 billion in spending.

SEN. BEN NELSON (D), NEBRASKA: It really is an opportunity for us to make the changes that I think need to be made to bring about the kind of support.

BASH: But even as the president was promising these senators bipartisan compromise, he was rallying Democrats to fight for their plan, urging a private gathering of Senate Democrats to give in only so much.

SEN. CLAIRE MCCASKILL (D), MISSOURI: The message was lean forward, get on offense. The people of this country spoke very loudly and very clearly that they wanted change.

(END VIDEOTAPE)

BASH: In fact, a source at that meeting with President Obama and Senate Democrats told us something that he said that may be a window into his approach. According to this source, President Obama said, "I know I've been spending a lot of time with Republicans. I want Republican support. But, he said, not at the expense of the American people". Lou.

DOBBS: Well, again, compelling rhetoric, but certainly not based on anything factual. The idea that the American people want the stimulus package flies in the face of the two most recent polls. That is the Gallup poll yesterday showing only 38 percent approve of the legislation that's now constructed. And today the Rasmussen poll showing more people oppose this legislation than support it. Where are they getting the idea that -- how can we substantiate their claim that the American people want this?

BASH: You know, I think that it is going to be answered in the next maybe 24 to 48 hours to see what really happens in the Senate, Lou. Just moments ago I found out that there was yet another meeting, maybe about an hour ago of not Republicans, but Democrats, still working on that amendment to try to scrub or strip out a lot of spending.

And in fact they're working not just -- again, Democrats working across the aisle with Republicans. And they might have that offer tomorrow, so maybe that's your answer in terms of rhetoric bumping up with reality.

DOBBS: The reality is that the two most recent surveys showed that that support is not there. Secondly, we have been going, as you know, Dana, through this legislation and, frankly, this legislation is -- and I'm saying this as an independent, not as a partisan in this at all. This legislation is extraordinarily weak.

It has no compelling economic theory behind it. There is no analysis that demonstrates what jobs would be created, what the economic impact would be. The game is being played frankly in a very shallow way in Washington, D.C. at a time when we need deep thinking and profound results. Dana thanks a lot -- Dana Bash.

Coming up here next, President Obama apparently being influenced by corporate America, special interests, lobbyists, you know the people he said he wouldn't be. He is refusing now to support ""Buy American"" provision in the so-called stimulus bill. We'll be telling you about that.

We'll tell you what he had to say about Harley Davidson products on the campaign trail, what he had to say about made America as a candidate, and what he's saying now as a president. Folks, we're only two weeks into this administration and we have got a problem.

The Senate wants to spend billions of taxpayer dollars on renewable energy programs as stimulus and job creation. Will it do either? We'll have that special report in "Lou's Line-Item Veto" here next. Stay with us.

(COMMERCIAL BREAK)

DOBBS: Wells Fargo deciding to cancel a lavish 12-day corporate junket to Las Vegas. Wells Fargo announced that decision last night shortly after our report aired. Wells Fargo received $25 billion of taxpayer bailout money to stay afloat. The bank's proposed 12-day retreat has been, we're told, an annual tradition for as many as 1,000 of its employees. This year's conference was going to be held at two of the most expensive hotels in Las Vegas.

The bank says the trip was planned for Wells Fargo employees and employees of the newly acquired Bank of Wachovia. I suppose though that the folks over at Wachovia could kind of get used to the culture there of Wells Fargo. Maybe it had been an opportunity for them to get together and learn how to help struggling homeowners. Because we want to update you tonight on one of Wells Fargo's very important clients, a client that they have ignored, as apparently they have so many other of their customers. This client is fighting for her home. She's fighting for her home through foreclosure. We first told you about homeowner Andrea Guice of Ohio last week. Tonight, she tells us she has yet to hear from a single Wells Fargo employee about any effort to modify her mortgage. As we reported, Guice put $40,000 down on her $147,000 home and she still ended up with a sub-prime mortgage.

Her monthly payments were nearly doubled to more than $1,500 a month. Guice paid her new higher payments for three years, going through her life savings, until she was no longer able to afford those payments. Guice is unfortunately just among a number of several homeowners who are now exercising squatter rights in their own home and they were advised to do so by their congresswoman, Congresswoman Marcy Kaptur.

As for the mortgage broker who sold Guice that loan, he no longer works we're told at Home Lend Mortgage. That's the company where Guice purchased her loan. A manager with Home Lend says the broker, as he put it, relocated to a new job in Florida. So if you're in Florida I suggest you look out for him.

As for Wells Fargo, I suggest you look out for them too. They didn't have the courtesy to return our calls today or Congresswoman Kaptur's or Ms. Guice's calls. Last week you should know that Wells Fargo told us they don't comment on individual cases. My comment was that individual cases are called people, and they're supposed to be serving people, but especially the taxpayers who saved their institution.

We hope Wells Fargo might, just might, gain a little sense of community and individual responsibility. We will continue to follow this story and keep you fully apprised.

Well, President Obama tonight is backing away from one of his key promises during the presidential campaign, "Buy American". President Obama apparently is now caving into pressure from special interest groups and even foreign governments who want to gut the "Buy American" provision from the stimulus legislation now in the Senate -- Bill Tucker with our report.

(BEGIN VIDEOTAPE)

BILL TUCKER, CNN CORRESPONDENT (voice-over): On the campaign trail, candidate Obama was very concerned about the American worker. Now that he's in the White House, President Obama suddenly appears concerned about appearing protectionist. With some exceptions, the House-passed stimulus bill says that all steel and iron used for bailout work projects must be American made. The White House says they're open to different wording.

GIBBS: The balance he wants to strike is to continue to get our economy going without -- without unnecessarily -- starting something with trading partners all over the world and global partners -- that will hinder getting our economy moving again.

TUCKER: Other countries are pressuring the White House, including threats to file a complaint with the World Trade Organization if the provision passes. Last year out on the presidential campaign trail then Senator Obama attacked his opponent, Senator McCain, for being opposed to buying American-made motorcycles for the Secret Service.

No protectionist worries then. Perhaps the president is also listening to the U.S. Chamber of Commerce now. The latest letter from the Chamber to congressional leadership is signed by 100 companies, many of which are not American, and warns of pending trade wars. The much smaller trade group, Alliance for American Manufacturing, has its own message for Congress and the president.

SCOTT PAUL, ALLIANCE FOR AMER. MANUFACTURING: The fact is that countries around the world have domestic sourcing requirements. They have them in the European Union. They have them in Canada. They have them in Asia. There's not going to be any American steel that goes into a single Chinese rail project that's contemplated in the Chinese stimulus plan.

TUCKER: "Buy American" provisions have been a part of government procurement contracts since at least 1933. One key Democrat in the Senate is promising they will continue.

SEN. SHERROD BROWN (D), OHIO: We're going to see these "Buy American" provisions strengthened in the Senate version of the stimulus package. We're going to see that included in the bill that only goes to the president. We're going to see the president sign it.

TUCKER: And those provisions, as they've always been, will be trade agreement compliant, said Senator Brown.

(END VIDEOTAPE)

TUCKER: Now, we, of course, will continue to follow this issue and let you know if the "Buy American" provisions are removed. We have reported this before, but it is worth repeating again -- there have been no trade wars as the result of any "Buy American" provisions. "Buy American" provisions, Lou, which I should point out, President Obama, then the candidate, called plain common sense back when he was campaigning to be our president.

DOBBS: He said it very clearly in the campaign. He said it is not protectionism, it is common sense. And today, last night more accurately, he's talking about protectionism. This is a disappointing reversal on the part of this president on an issue critically important to many of those who supported him, many of those who voted for him.

It's critically important, if this president hasn't the courage and the principle to back up what he said during the campaign, then on this issue we are more than witnessing a flip-flop by a president. We're watching this nation actually be put into great jeopardy because it means that we're on a path to simply turning over the keys to the European Union, which as you report, already has its own subsidies and its own support and to the World Trade Organization as a superior organization to that of our laws, our sovereign laws in this sovereign nation.

It's insane what they're doing. And the mealy-mouth of parsing here is, well it's unbecoming and I have to find -- tell you frankly, it is so unlike what I think any of us expected from this president. Certainly the American working man and woman who depends on leadership for their own protection and that's not protectionism. Bill Tucker, thank you very much.

Well, a lot of anger tonight at the U.S. Chamber of Commerce's outright opposition to that "Buy American" provision in both the House and the Senate. The U.S. Chamber of Commerce -- now, you wonder why they even call themselves the U.S. Chamber of Commerce -- is utterly refusing to act in the interest of American workers or for that matter, the American economy. So we ask you to join us tonight in, well, demanding the removal of U.S. from the U.S. Chamber of Commerce.

I think it would be kind of interesting if the Chamber knew how people felt about their using "U.S." because it's pretty clear they're not interested in the U.S. national interest and they're not interested in the U.S. worker. They're not interested in the U.S. interest at all. You can find a link to the Chamber's Web site, if you'd like to send them a thought, at loudobbs.com. We'll keep you posted on their thoughts. We hope you'll keep them posted on your thoughts.

We'd like to know what you think. Here's our poll question tonight in keeping with that. Do you believe the U.S. Chamber of Commerce should, in the interest of honesty, drop "U.S." from its title? Yes or no. Cast your vote at loudobbs.com. We'll be bringing you the results here later.

President Obama today signed into law the SCHIP legislation. That legislation expanding children's health coverage but opponents say it will make it easier for illegal aliens to receive tax-payer funded health insurance. They also warn that it expands government and title programs at a time when the federal government is already bloated. Lisa Sylvester has our report.

(BEGIN VIDEOTAPE)

LISA SYLVESTER, CNN CORRESPONDENT (voice-over): Twice vetoed by President Bush, the SCHIP legislation was made law by President Obama.

OBAMA: In a decent society, there are certain obligations that are not subject to tradeoffs or negotiations and health care for our children is one of those obligations.

SYLVESTER: The law reauthorizes the children's insurance program for seven million kids, expands the program to four million more, and allows children of legal immigrants to sign up. The additional cost, $32.8 billion, paid for with the 62-cent cigarette tax.

REP. ANNA ESHOO (D), CALIFORNIA: Today, a promise is being kept to America's children. They will be insured with health insurance.

SYLVESTER: But SCHIP was hotly debated in Congress, Republicans leading the opposition, arguing that it will expand government- sponsored health insurance, and that it loosens the identity document requirement so that even people living in the United States illegally might be able to access the program.

REP. NATHAN DEAL (R), GEORGIA: At a time when we are hearing people saying, we want you to secure our borders, we want you to protect us. We're saying we're going to open it up to anybody who just wants to tell you they're a citizen.

SYLVESTER: Other groups take issue with the cigarette tax, pointed to a campaign promise by President Obama of no new taxes for those making less than $250,000 a year.

PHIL KERPEN, AMERICANS FOR PROSPERITY: So this tax is going to fall very heavily on lower-income and middle-income folks who were promised that they wouldn't see any tax increases.

SYLVESTER: Republicans offered amendments to change the legislation, but with Democrats now running the show on Capitol Hill, most of their concerns were brushed aside.

(END VIDEOTAPE)

SYLVESTER: And on loosening the identity checks, Representative Michael Burgess said that you have to show your ID before you cash a check at a grocery store, so why wouldn't we require someone to show identification before they receive this health care benefit? Lou.

DOBBS: I guess it's because it's just our money, Lisa, ours and our fellow citizen's money. They're not too concerned about that, I think, in Washington, D.C. That's amazing.

SYLVESTER: Yeah and you know I think it's the obvious thing. But often times in Washington, on Capitol Hill, they don't know necessarily do what is obvious or right, Lou.

DOBBS: As I have noticed here of late, Lisa, thank you very much. I know you have as well. Lisa Sylvester, thank you very much.

Well up next new questions about whether the employee so-called Free Choice Act will help workers or just the unions.

And more evidence that Mexico's drug cartel wars are worsening, the number of gang members in this country are rising. We'll be right back with those stories.

(COMMERCIAL BREAK)

DOBBS: Sobering new statistics tonight about gang activity in this country. The FBI reporting a million people belong to more than 20,000 criminal gangs in this country. Many of the gang members have direct ties to Mexico's violent drug cartels -- Casey Wian with our report from El Paso, Texas.

(BEGIN VIDEOTAPE) CASEY WIAN, CNN CORRESPONDENT (voice-over): Four-year-old Roberto Lopez, Jr. (ph) was walking to a community center with his sister one afternoon last month when he was killed by a stray bullet.

LT. JOHN ROMERO, LOS ANGELES POLICE DEPT.: We believe that the motivation for the shooting is gang involvement. It is gang related.

WIAN: The suspect, an alleged gang member nicknamed Dopey, already this year the Los Angeles Sheriff's and Police Departments have investigated 36 shooting or stabbing deaths. Up to 80 percent of crime in some jurisdictions like Los Angeles is gang related.

MAYOR ANTONIO VILLARAIGOSA, LOS ANGELES: Working hard to address the violence in these neighborhoods, but unfortunately, despite those efforts, this young boy is no longer with us and it's an absolute tragedy, it just is.

WIAN: Nationwide criminally active gang membership has soared 25 percent since 2005, to about one million people, according to the newly released National Gang Threat Assessment. The report details the spread of gangs across international borders and into suburban neighborhoods.

DANIEL MCMULLEN, FBI: If there are better opportunities to recruit gang members in an area that has not traditionally seen gang activities then you'll find gang members moving there. There may be territory that's ripe for the drug trade.

WIAN: Also among its findings, gang members are the primary retail level distributors of most illicit drugs. Some gangs traffic illicit drugs at the regional and national levels. Several are capable of competing with U.S.-based Mexican drug trafficking organizations. U.S.-based gang members illegally cross the U.S./Mexico border for the express purpose of smuggling illicit drugs and illegal aliens from Mexico into the United States.

One of most alarming findings is the growing number of gang members with military training. According to a recent law enforcement intelligence report obtained by LOU DOBBS TONIGHT, one-third of the U.S. law enforcement agencies in southern California reported gang members with military training in their jurisdictions.

(END VIDEOTAPE)

WIAN: Some local agencies report U.S. gang members in possession of sensitive military equipment and weapons. It's another parallel of what's happening across the border in Mexico where former military members have been working with drug cartels for years, and those who refuse face death. On Monday in Cancun, a retired former Mexican general who had just taken the job on Monday as the top drug official in that area, was found shot to death on Tuesday. More than 195 U.S. cities are now the site of operation by Mexican drug cartels, according to the U.S. law enforcement, Lou.

DOBBS: And yet we do not see a concerted effort on the part of the U.S. -- U.S. authorities to deal with the drug cartels, to secure these borders, to secure the ports, and they continue to permit this vast smuggling of illicit drugs, methamphetamines, cocaine and heroin into the United States. This is truly an era of shame for the United States in the war on drugs.

WIAN: Yeah, it's not for want -- or lack of programs. Big cities along the border and elsewhere have dozens of anti-gang programs. The federal government participates in many of those. As you mentioned, Lou, as long as that border is open to illegal aliens, drug traffickers and drugs coming across, the gangs will continue to spread across the border.

DOBBS: No one should kid themselves here, Casey. Let me say it very explicitly. It's one of the reasons that border remains wide open, to suit the interests of both the cartels and the corrupt distribution network, and those who profit from the devastation and the death of illegal drugs in this country. It's that straight forward. Casey, thanks a lot. Casey Wian reporting from El Paso, Texas, tonight.

Up next here, lawmakers want to spend billions of dollars of taxpayer money on so-called renewable energy programs. But will those programs actually stimulate the economy or create jobs anytime soon? We'll tell you.

And the fight to stop corporate America and ethnocentric special interest groups from killing the most successful program against illegal immigration tonight. The congressman trying to save that measure, e-verify, joins us here next. We'll be right back.

(COMMERCIAL BREAK)

DOBBS: The house version of the so-called economic stimulus bill includes a multiyear extension of e-verify. E-verify is the single most effective federal program against illegal immigration. The democratic leadership in congress, the U.S. chamber of commerce, and other special interests, want that program absolutely dead. Some lawmakers, however, are fighting to make certain it lives. Among them, Congressman Lamar Smith of Texas. He joins us tonight from Capitol Hill.

Congressman, good to have you with us. You know, as we report on this issue with e-verify, it is set to expire, as of right now, March 3rd, I believe that's correct.

REP. LAMAR SMITH (R), TEXAS: That's correct.

DOBBS: The fact that the cowards in congress would play the games that they have, to kill this legislation and try to do so in the absence of oversight on the part of the American people, I mean, that's scurrilous.

SMITH: It is. And, of course, this is a program that's supported by an overwhelming majority of the American people. It is absolutely right that we keep and protect these jobs for American citizens and for legal immigrants. This is a program that doesn't cost anything. It costs employers about a minute per employee to check to make sure they're legal and in the country legally. I don't know who couldn't favor that, to tell you the truth. But there are some people who are opposed. It really makes you wonder whether they really want to save these jobs for American citizens and whether they want to really reduce illegal immigration or not so --

DOBBS: Well, the American people, congressman, excuse me, should really know, once again, the U.S. chamber of commerce is leading the fight against e-verify, a long with the democratic leadership in both the senate and the house, and the Obama administration. The U.S. chamber of commerce has become an organization that's anti-American. It is anti-U.S. anti-worker. Anti-rule of law in this country. They are a -- I mean, what is your -- what is your reaction to the role of the U.S. chamber in this?

SMITH: I have to tell you, I'm surprised and disappointed, too. I hope they'll see the light. I don't think it helps them at all to be on the opposite side of the American workers. We all should want to protect these jobs for American citizens and legal immigrants. The center for immigration studies just came out and said they believe there will be 300,000 illegal immigrants who will get jobs, unless we have this program up and going. And as you said, it's set to expire. We need to continue it. We need to make it mandatory to all federal contractors.

DOBBS: If you would, repeat that. How many again?

SMITH: 300,000 is the estimate of the number of illegal immigrants that will get jobs under the house stimulus program, if we don't have the e-verify program that applies to these federal contractors.

DOBBS: I mean, this is -- and it's not an accident that obviously the Obama administration is pushing e-verify away from being available to employers, particularly in construction. The house, open borders, and of course the liberal wing, "The New York Times," they wrote in a front page article about the federal program. Here's what they had to say. "Internal directives by immigration officials in 2006 raised arrest quotas for each team in the national fugitive operations program, eliminated a requirement that 75 percent of those arrested be criminals, and then allowed the teams to include non- fugitives in their count." Now, while arresting criminal illegal aliens is important, what kind of message does it send when a liberal bastion like "The New York Times" tells us they want to give non- criminal aliens a pass?

SMITH: They're basically what they're saying, everyone who's in the country is, we're going to give you amnesty because we don't want the government to try to deport you. We only want the government to go after certain types of individuals who may have committed other serious crimes. But that's a horrible message. We need to send the message that if you're in the country illegally, you're going to go home --

DOBBS: Are you going to be successful in preserving e-verify or is it dead? SMITH: I am hopeful we will be. At least the president has said he supports it in theory. The secretary of homeland security said she supports it. So to the extent we can get support for the e-verify program and get people to understand this is essential to protect American job we can get it in there.

DOBBS: Congressman Lamar Smith, thank you for being with us. Appreciate it.

Up next, the hard push on Capitol Hill by organized labor to change the way workers unionize. And a warning for the president and others from a union.

(COMMERCIAL BREAK)

DOBBS: In Lou's line-item veto tonight, we focus on the $14 billion in spending and borrowing legislation. This time for renewable energy programs, so-called. President Obama promised to invest in clean energy during his campaign. But how would this investment stimulate our economy now and how many jobs would it create now? Kitty Pilgrim with the answers.

(BEGIN VIDEOTAPE)

KITTY PILGRIM, CNN CORRESPONDENT: In a perfect world, energy would be clean, plentiful and cheap, generated by wind and sun. A great goal but some say not appropriate for a stimulus plan.

PETER VAN DOREN, CATO INSTITUTE: Voter sentiment for renewable energy is kind of a make-believe fantasy that somehow money can come from heaven and make things beautiful and cheap and green all at the same time and no one's bills go up and of course none of that's possible.

PILGRIM: There are lots of reasons for our economy and environment to invest in wind and solar energy but wind and solar are capital-intensive industry, not labor intensive. So job creation would be expensive.

According to the Center for American Progress, it would take $50,000 of taxpayer money to create every green job, a government subsidized job in an industry already heavily subsidized. The house stimulus proposal of $18 billion would be ten times the current government funding for renewable energy. The senate plan of $14 billion is seven times higher. And neither plan would spend the money quickly.

REP. DARRELL ISSA (R), CALIFORNIA: Whether you're talking 14 or 18, you only have about 2 that could possibly be properly spent in the first two years. These projects are taking ten-plus years to get off the ground because even those who say they're environmentalists don't want them in their backyard.

PILGRIM: And the Congressional Budge Office says the new funding would not be stimulative. "We therefore expect that the proportion of spending that would occur in the first few years would be lower than for the existing programs, reflecting the time it would take doe to establish new programs." Some say the heavily subsidized renewable energy industry does not deserve even more money.

THOMAS PYLE, INST. FOR ENERGY RESEARCH: That money doesn't grow on trees. It comes from somewhere. So if we are spending taxpayer dollars to prop up these industries that wouldn't otherwise exist in the private sector, we are diverting those resources away from other things.

(END VIDEOTAPE)

PILGRIM: Even some of the critics we talked to today said renewable energy development is a very good long-term goal for the country, but many think it does not deserve a place in stimulus plan, Lou.

DOBBS: Stimulus plans like this one, piled up higher and higher all the time. The senate going through -- I mean, it's -- you know, the American people are wising up to this. And the Rasmussen poll this morning showing more people are opposed. The Gallup poll showing up 38 percent supported the thing the way it is. I mean this is a bad joke. And this is not very funny, given this change of leadership, the American people expecting real leadership on this, not a bunch of PR nonsense. Kitty Pilgrim.

Please join us tomorrow. We'll be reporting tomorrow on the $88 million provision, for example, in the senate's bill for a coast guard polar icebreaker. That won't pay for the construction of an icebreaker, it just pays for its design. How does that stimulate the economy? How does it create jobs? The answers tomorrow on Lou's line- item veto.

And coming up here next, will this country be better off without lawyers? Raise your hand if you think so. Phillip Howard, the best selling author of "Life without Lawyers" joins me.

And the nation's most powerful labor union is using some political capital from the last election to threaten their candidate who is now president of the United States.

(COMMERCIAL BREAK)

DOBBS: A bold threat tonight from one of the most powerful unions in the country, a bold threat to democratic lawmakers and President Obama. The Service Employees International Union marching on Capitol Hill today, marching to demand that democrats pass the so- called employee free choice act. The Service Employees Union, which did help many democrats win election, including the president, said that those democrats must keep their promises or else. Drew Griffin with our report.

(BEGIN VIDEOTAPE)

DREW GRIFFIN, CNN CORRESPONDENT: The battle has been waged inside this Indianapolis office building for three years. But the fight at the corner of Illinois and Market Streets is about to spread to every Main Street in the U.S. This noisy protest by members of the service employees' international union is specifically about janitors, but nationally, it's about the employee free choice act.

DAVE BEGO, EMS OWNER: Check is real simple. They want to eliminate the secret ballot election.

GRIFFIN: Dave Bego says in his case, the workers don't want the union.

BEGO: They've been after us for almost three years. And they've only got 10 or 12 people interested in what they have to sell.

GRIFFIN: Bego runs EMS, a national janitorial service based in Indianapolis. He started it 20 years ago and has never been unionized. Its workers, at least those chosen to talk to us, say that's the way they want it.

UNIDENTIFIED MALE: I think the union, everybody needs a union, and unions are good, but with this company, we've been treated pretty fair and the work is good.

GRIFFIN: The SEIU says the real reason Bego's firm does not have a union is because workers who try to organize, like Shanika Brown and Harry Webster, are fired. Why has it been so hard to convince your other fellow employees of EMS to do that?

UNIDENTIFIED FEMALE: Fear.

UNIDENTIFIED MALE: A lot of intimidation.

GRIFFIN: Bego denies it but says if his workers want a union, fine, as long as they can vote in secret. He even took out this ad in the Indianapolis newspaper telling the SEIU to fish or cut bait.

BEGO: Let's have an election, let's have it now. If our people choose to join your union, we'll live with it. If they don't, pack your bags and go talk to another company or go to another city.

GRIFFIN: Did they fish?

BEGO: They did not fish. We never heard one word.

GRIFFIN: Andy Stern is the powerful president of the Service Employees' International Union. And says folks all over the country soon will be hearing from his union.

BEGO: Isn't our whole democracy based on you don't know how I vote, I don't know how you vote, and that is the basic fairness in the election?

ANDY STERNS, SEIU PRESIDENT: This isn't necessarily an election. This is people wanting to start an organization. This is the worker's choice. They can have a secret ballot or legally affirm by a majority of them signing cards.

GRIFFIN: Right now, it is democrats in congress and the white house who will have to deal with Sterns. The SEIU was the largest contributor to democratic campaigns this election, $85 million. And the union says 2,000 members of SEIU gave up their jobs to work full time for Barack Obama. Sterns says politicians who made promises better keep them or else.

STERNS: We can lobby, we can petition, we can use the same things we do in the electoral process to unelect people.

GRIFFIN: So everybody should be scared of you?

STERNS: Everybody should be scared of living up to their promise.

(END VIDEOTAPE)

GRIFFIN: Lou, how serious is he about that threat? They have set aside millions of dollars on reserve to unelect any of these politicians that stern says don't come through with their campaign promises. Back in Indianapolis, that business owner thinks that the democrats will have no choice but to pass this freedom of choice act for employees.

DOBBS: That's a straight-forward threat, isn't it?

GRIFFIN: Yeah, it is. There's no beating around the Bush with Mr. Sterns. He says what he wants and he's, so far, getting what he wants. He has backed these democrats with money, time, effort, sweat from his union, and he expects some changes. That's what the American people voted for, he says.

DOBBS: We well, the American people voted for lots of things, but I don't know a lot of people voted to end a secret ballot. That's pretty radical, even in this era of nationalization and socialization of our economy, isn't it?

GRIFFIN: Well, that will be the hang-up, I'm sure, in congress if it gets that far. I asked him point blank is there any wiggle room on this. The answer's no, they want it.

DOBBS: Thank you very much, Drew. Drew Griffin.

The Service Employees' International has a long track record of lobbying amongst other things for amnesty for illegal aliens as well. The SEIU also has tied with the so-called community organizing group ACORN. In fact, it shares buildings with groups such as ACORN are included, by the way in the stimulus bill, a bill calling for more than $4 billion, by the way, for something called neighborhood stabilization activities. That means fund for advocacy groups such as acorn, which is partisan groups supporting President Obama and others through its voter registration drives and other activities. ACORN is under investigation in more than a dozen states. ACORN, a major supporter of the democrats across the country.

Reminder to join me on the radio Monday through Friday for the Lou Dobbs show. Go to loudobbs.com to get the local listings for the show in your area and you can listen to me in San Francisco on talk 910AM, KNEW.

And up at the top of the hour, Campbell Brown, "NO BIAS, NO BULL."

Campbell what are you working on?

CAMPBELL BROWN, CNN ANCHOR: Hey, Lou. We are looking at the fine print of President Obama's plan to crack down on corporate bailouts and greed. Is this really good policy or just a PR move? We're going to be talking about that coming up.

Also ahead, two weeks into the new administration and Dick Cheney has got plenty to say about whether President Obama can keep us safe from terror. He warns the new white house may not be tough enough. You'll hear this provocative new interview with the former vice president at the top of the hour, Lou.

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

Up next, "Life without Lawyers" a brand-new best-seller from Phillip Howard. Stay with us.

(COMMERCIAL BREAK)

DOBBS: Philip Howard is the author of the provocative new book "Life without Lawyers, Liberating Americans from Too Much Law." Phillip, great to have you here.

PHILIP HOWARD, AUTHOR, "LIFE WITHOUT LAWYERS": Nice to be here Lou.

DOBBS: I want to turn to a couple things I think are just going to shock some people, amongst the factoids, if you will, in your book. 78 percent of middle and high school teachers in America have been threatened with lawsuits or accused of violation of rights by students. HIPPA regulations that paperwork you're forced to sign at each doctor's office appointment acknowledging your right to policy, adds $1 billion in medical costs. The list goes on and on. This is insane.

HOWARD: It is insane. We're drowning in laws in this society. If we look at this --

DOBBS: I love what you said on leadership. "We lack leaders because we basically made leadership unlawful. America doesn't allow a teacher to run a classroom or a judge to dismiss a $54 million claim for a loss of pants. Washington is legally dead, unable to breathe any sense into outmoded laws, unable to prevent special interests from feeding off its carcass." I love that. I'm going to quote that everywhere. But that said, what do we do about it? I mean, teachers can't teach. Judges can't make judgments. And our lawmakers -- well, god knows they can make enough laws, but they're right, there's just a carcass right now in Washington, D.C.

HOWARD: Washington's paralyzed. Poor President Obama can't stimulate the economy because he doesn't have the authority to spend the money.

DOBBS: This is a Christmas tree, look at all the pretty ornaments.

HOWARD: Even if you wanted him to do something, he couldn't do it because of all the laws choked up. So you have to restore the authority of a teacher to run a classroom. Pull back the laws. Every school ought to be run as if it were a charter school.

DOBBS: And help me out here. We've got lawyers who make money by hour. They are being paid to take as long as possible. They're being incentivized to drag everything out. You can't get a speedy trial in this country, whether it's a civil trial or -- a civil trial or a criminal trial. The constitution requires that. Lawyers are destroying the fabric of this country on that basis alone.

HOWARD: Yeah, it's a -- we tried to create a legal system where everything would be perfect.

DOBBS: This is not good. When people can't have a trial --

HOWARD: No, it's the enemy of the good. It's five years on average for a medical malpractice case to get to settlement. Five years. During that entire five years, the patient is getting nothing if they're injured by a mistake. And the doctor can't sleep at night.

DOBBS: What are we going to do about it?

HOWARD: We have to overhaul our legal infrastructure. Pull it back. Let people be free to take responsibility.

DOBBS: "Life without Lawyers." Thanks very much. Good to have you here. Very good book.

Tonight's poll results, 93 percent of you say the U.S. chamber of commerce should, in the interest of honesty, drop "U.S." from its title. Thanks for being with us tonight. Campbell Brown, "NO BIAS, NO BULL," starts right now.

Campbell?

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