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LOU DOBBS TONIGHT

New Beginning; Sotomayor Showdown; Amnesty Agenda; Selling out National Security

Aired June 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: Thanks, Wolf. Good evening, everybody.

The president calls for a new beginning in relations with the Muslim world. President Obama telling Muslims the United States made mistakes in the past and promised an even handed approach in the future.

Also, Supreme Court nominee, Judge Sonia Sotomayor, makes a new attempt to explain her wise Latina comment, what Democrats say was simply a poor choice of words. But now there's evidence it wasn't the first time Sotomayor linked group and identity politics with law.

And sharp divisions among liberals and pro amnesty advocates over legislation that would make it easier for Americans to bring their same-sex partners into the United States. That's the subject of our "Face Off" debate tonight.

And the fight over the future of the Republican Party -- the authors of a provocative new book "The Grand New Party" join us to tell us how Republicans can win.

We begin tonight with the president's appeal for a new beginning with Muslims. In a speech in Cairo, President Obama called for democracy and human rights in the Muslim world. And a new alliance against what he called violent extremists. Not once did President Obama use the phrase "radical Islamist terrorists" or "terrorists."

President Obama also drew a parallel between the murder of six million Jews in the Holocaust and Palestinians living under Israeli occupation. The president said we will be blind to the truth, as he put it, if we see the Arab/Israeli conflict from only one side. President Obama also appeared to some to apologize for U.S. policy in the Muslim world.

(BEGIN VIDEO CLIP)

BARACK OBAMA (D-IL), PRESIDENT OF THE UNITED STATES: Given our interdependence, any world order that elevates one nation or group of people over another will inevitably fail. So, whatever we think of the past, we must not be prisoners to it. Our problems must be dealt with through partnership. Our progress must be shared.

(END VIDEO CLIP)

DOBBS: President Obama tonight visiting Germany -- Jill Dougherty in Washington reporting on the president's speech.

(BEGIN VIDEOTAPE)

JILL DOUGHERTY, CNN FOREIGN AFFAIRS CORRESPONDENT (voice-over): President Obama said the bond between Israel and the United States is unbreakable, but...

OBAMA: The United States does not accept the legitimacy of continued Israeli settlements.

(APPLAUSE)

DOUGHERTY: And there was more.

OBAMA: So, let there be no doubt. The situation for the Palestinian people is intolerable. And America will not turn our backs on the legitimate Palestinian aspiration for dignity, opportunity and a state of their own.

DOUGHERTY: Quoting the Koran, Mr. Obama drew applause when he denounced extremist killings in a message to moderate Muslims.

OBAMA: None of us should tolerate these extremists. They have killed in many countries. They have killed people of different faiths, but more than any other, they have killed Muslims.

DOUGHERTY: On Iran, President Obama said the U.S. is willing to move forward without preconditions on the basis of mutual respect. But, Iran should not be allowed to have nuclear weapons.

OBAMA: This is not simply about America's interests. It's about preventing a nuclear arms race in the Middle East that could lead this region and the world down a hugely dangerous path.

(END VIDEOTAPE)

DOUGHERTY: No single nation, he said, should get to decide who gets to have nuclear weapons. And he -- and that is why he supports a nuclear-free world. And although he didn't use the name, he did have a message for Iranian President Mahmoud Ahmadinejad. He said, denying the Holocaust is baseless, ignorant, and hateful. Lou?

DOBBS: Jill, thank you very much -- Jill Dougherty.

Congressional Republicans quick to criticize the president's speech, particularly his remarks on Iran and the Israeli/Palestinian conflict -- House Minority Leader John Boehner said President Obama was unfair to Israelis by saying they are equally to blame for the conflict as Palestinians. Congressman Boehner also blasted the president for his comments on Iran.

(BEGIN VIDEO CLIP)

REP. JOHN BOEHNER (R-OH), MINORITY LEADER: His point about Iran, where he continues to say that he'll sit down with the Iranians without any preconditions, I just think that that puts us in a position where America looks weak in the eyes of -- of their rulers.

(END VIDEO CLIP)

DOBBS: Congressman Boehner also asked how the president can promise to close the Guantanamo Bay prison without having a plan for the distribution of the detainees.

Joining me now for more on the impact of the president's speech our senior political correspondent, Candy Crowley -- Candy, good to have you with us.

CANDY CROWLEY, CNN SR. POLITICAL CORRESPONDENT: Thanks, Lou. It was an interesting, interesting speech that is being seen both here and in the Arab and the Islamist world certainly in a couple of different ways. I think you saw what the president's critics are now complaining about, worried about, and that is what they call moral equivalency as you mentioned.

The idea that somehow the Holocaust, that (INAUDIBLE) think of the Jews is the same thing as the Palestinians and their quest for territories, so there is that. There is also really the sort of subtle argument here is sort of the difference between soft power and hard power.

You heard a whole change in language from former President Bush to President Obama and you hear a different, more equal, less sort of combative approach. The only time that the president even seemed to mention power was when he said, listen, let us remember that we didn't want to go to Afghanistan.

We went there because we were attacked and more than 3,000 people died, and I'd leave Afghanistan today if I thought we had taken care of the extremists that caused 9/11. So that -- but that was the only sort of what you would call muscular talk in the president's entire speech.

It was much more an effort to reach out and -- and by and large the umbrella thought that the president wanted to put out there in so many ways was new page, new president. I'm not George Bush.

DOBBS: Establishing clearly that and at the same time, again, extending an apologetic tone through that speech and also being criticized for it -- your thoughts?

CROWLEY: Well, you know, it's a -- quite literally speaking, there was no, quote, "apology". But certainly when it came to Iraq, the president wanted to make a clear line between a war of choice, which is what he called Iraq, and the Afghanistan war. He said that the U.S. moved away from its ideals after 9/11 in fear and in anger.

There are many, many who would look and say, wait a minute, that's an apology. And as you know, before he even left on this trip, critics of the president were saying this is an apology tour. He had said no, no apologies here. I'm just going to lay it out.

So, he put it out in a way that doesn't include, you know, I'm sorry, I regret, but he certainly made it clear that he did not approve of nor would he continue to follow the actions of George Bush.

DOBBS: All right, Candy Crowley, thank you very much from Washington.

We'd like to know what you think, and our poll question tonight is -- are you concerned that President Obama seems compelled to continue to apologize for the United States wherever he travels? Yes or no? Cast your vote at loudobbs.com. We'll bring you those results here later in the broadcast.

Another major political issue, the showdown over the president's Supreme Court nominee, Judge Sonia Sotomayor -- Judge Sotomayor today spent a third day on Capitol Hill, meeting with the senators who will vote on her confirmation. One of those senators, Susan Collins, said Judge Sotomayor told her, her wise Latina comment was made in 2001 to simply be aspirational. Brianna Keilar has our report.

(BEGIN VIDEOTAPE)

BRIANNA KEILAR, CNN CORRESPONDENT (voice-over): Delivered to the Senate Judiciary Committee today, boxes of documents about Sonia Sotomayor and answers to the committee's questionnaire. Her net worth, every event where she's spoken, potential conflicts of interests, like any matter involving Fendi, the high-end Italian purse maker and her former longtime client.

But for all the questions, there isn't one that gets at the central concern Republicans have -- will Sotomayor's personal experience influence her rulings? Before 2007, nominees were asked about their views on judicial activism, but based on a bipartisan agreement, the Judiciary Committee decided the subject was better left for the confirmation hearing and also for the interviews Sotomayor is having with senators. Just today, Maine Republican Susan Collins asked her to clarify comments about how a wise Latino would more often than not reach a better conclusion than a white male.

SEN. SUSAN COLLINS (R), MAINE: That was a comment that had troubled me, so I questioned her at length about it. The judge explained to me that she intended it to be an aspirational comment. She assured me that she understands when deciding cases that she needs to put aside any personal experiences that might color her decisions and as she said it, that the law is the law.

(END VIDEOTAPE)

KEILAR: Clearly, Lou, this issue is not settled, and it's going to continue to dominate Sotomayor's confirmation process going forward, Lou.

DOBBS: Well, Brianna, just what does Judge Sotomayor mean by aspirational? How does that explain anything?

BLITZER: No, that's certainly something that we want to know, and Senator Collins was asked about that more than once, really, what you heard there, Lou, was as far as she would go. As you know, some of these speeches that Sotomayor has given have been before students, law students, so it begs the question was she trying to inspire them?

Was she trying to tell them that there's a role for everyone in the profession of law? We just don't know, of course, although we would like to and we expect to learn more going forward through this process.

DOBBS: All right, Brianna, thank you very much -- Brianna Keilar from Capitol Hill.

The White House and Democratic Party continue to insist that Judge Sotomayor made a, quote, "poor choice of words back in 2001 when she said Latina women would make better judges than white males." But it turns out she said something very much like that before -- seven years before. Let's compare what she said on both occasions.

In 2001, Judge Sotomayor said, quote, "I would hope that a wise Latina woman with the richness of her experience would more often than not reach a better conclusion than a white male who hasn't lived that life." Now, take a look at what she said at a conference in Puerto Rico in 1994.

Sotomayor said, quote, "I would hope that a wise woman with the richness of her experience would, more often than not, reach a better conclusion" -- two speeches seven years apart almost identical language. Republicans say it's hard to believe that Judge Sotomayor simply made a poor choice of words in 2001.

Troubling evidence tonight that terrorists and foreign spies can secure sensitive U.S. military technology and do so legally and a deadly new wave of violence along our border with Mexico -- Mexican drug cartels escalating their violence.

(COMMERCIAL BREAK)

DOBBS: More than 40 people have been killed in drug violence along the Mexican border so far this week -- the latest victims, two Mexican police officers in the border city of Juarez. Over the weekend, 33 people were killed, nine more reported killed Monday. Among the dead, five patients who were shot inside a drug rehabilitation clinic -- more than 12,000 people have been killed in drug violence in Mexico over the past two and a half years.

Another American city is going to issue ID's to illegal immigrants. The city council of Oakland, California, has voted for a plan that would offer identification cards to anyone who lives in the city, including illegal aliens. Similar programs already in effect in New Haven, Connecticut and San Francisco -- Bill Tucker with our report.

(BEGIN VIDEOTAPE)

BILL TUCKER, CNN CORRESPONDENT (voice-over): Oakland, California is following in the steps of New Haven, Connecticut, and the city across its bay, San Francisco. Oakland City Council voting to issue city identification cards to all of its residents, including illegal aliens. Groups supporting more restrictive immigration policies are outraged by the action.

DAN STEIN, FED. FOR AMER. IMMIG. REFORM: These ID's are issued in direct violation of U.S. immigration law trying to establish a form of lawful residency for people with no right to be in the country.

TUCKER: Because the critics say the ID cards create the appearance of legal presence in the country. But members of the Oakland City ID Card Coalition hailed the program as a step towards equality for all of the city's residents. This city's vice mayor co- sponsored the program. He calls it essential.

IGNACIO DE LA FUENTE, VICE MAYOR, OAKLAND, CALIF.: People cannot even open a bank account. That means that they have cash in their pockets. They become targets of crime. Many issues that are real- life issues that go beyond in my opinion and my ability to -- to impact, you know, legal or documented or the immigration debate.

TUCKER: De La Fuente (ph) says Oakland's program will be modeled on New Haven's program, which began issuing ID cards in 2007 to a storm of controversy. Legal challenges to the programs in New Haven and San Francisco have failed. But beyond the legal issues, critics from groups fighting illegal immigration like the Center for Immigration Studies say there is a fiscal reality that looms even larger.

JESSICA VAUGHN, CTR. FOR IMMIGRATION STUDIES: I'm astonished that the city of Oakland would take this step, because of all we know about the fiscal -- the strains that illegal immigration imposes on communities, both fiscal strains and social strains and all the public safety risks.

TUCKER: The state of California currently has a more than $20 billion budget deficit, and Oakland has a $95 million budget deficit.

(END VIDEOTAPE)

TUCKER: And Oakland has pretty aggressive hopes in terms of implementing its plan. The vice mayor saying today they hope to have their program up and running in about eight to 10 weeks, Lou.

DOBBS: Well that's, you know, and we've got right now just one out of every $6 that Americans are receiving now are coming from either the state or the federal government. Sixty percent -- think about this -- 60 percent of all income in this country -- 60 percent of all the voters in this country, their income comes from the state or from the federal government in greater measure than what they pay in taxes.

So, it's going to be a difficult vote, I would think, to defeat that in Oakland or San Francisco or New Haven where voters are getting more money back from the government than they're -- than they're paying in taxes. Bill Tucker thanks a lot.

TUCKER: You're welcome.

DOBBS: Congress tonight defying the president. A House panel has blocked President Obama's efforts to kill the Criminal Alien Assistance Program. That program helps states pay for the incarceration of criminal illegal aliens. The president's budget sought to eliminate that program. Instead, the congressional panel calls for spending $300 million on that plan next year.

A controversial conflict tonight between immigration reform and gay marriage and that's the subject of our "Face Off" debate and an investigation revealing how easy it is for this nation's enemies to obtain our sensitive military technology and equipment.

(COMMERCIAL BREAK)

DOBBS: Congressional investigators today confirmed what we've been reporting here for years, that terrorists and foreign spies can easily obtain some of our most sensitive military technologies and obtain them, of course, legally. The Government Accountability Office set up fake companies. They bought U.S. military equipment, and then they shipped it overseas. Some of that equipment can be used in nuclear weapons. Chris Lawrence reports from the Pentagon.

(BEGIN VIDEOTAPE)

CHRIS LAWRENCE, CNN CORRESPONDENT (voice-over): You don't need night-vision goggles to see there's a problem here -- American companies selling these lenses and other weapons parts to potentially hostile governments and terrorists.

GREGORY KUTZ, GAO INVESTIGATOR: You have nuclear applications, guided-missile applications, improvised explosive devices potentially being used in Iraq against our own soldiers.

LAWRENCE: The Government Accountability Office says American parts are bought, sold, and sent who knows where.

UNIDENTIFIED MALE: They're items that were shipped to places like Pakistan, China, and Iran or Hezbollah.

LAWRENCE: To prove the lack of oversight, GAO investigators set up a fake company, address and e-mail. They used a credit card to buy parts from American companies, like equipment used in smart bombs. These chips helped steer guided missiles and even after a real American company was punished for selling them to China, GAO's fake company got an order for 10.

UNIDENTIFIED MALE: We never really had to meet with anybody, talked to them on the phone.

LAWRENCE: Some parts were strictly military, others had dual uses. This high voltage switch has medical applications; it can also be used to detonate nuclear weapons. The GAO got approval for 100.

REP. BETTY SUTTON (D), OHIO: It's as if our own country has become a terrorist bazaar.

LAWRENCE: Some distributors do ask buyers to sign an end-use agreement, which just states how you plan to use the equipment. UNIDENTIFIED MALE: So, if I wanted to do something bad, with what I got, I'd just sign this and say I promise not to use this to create a nuclear, biological or chemical weapon, honest.

(CROSSTALK)

UNIDENTIFIED MALE: Signed Osama bin Laden. It would be believable and enforceable.

UNIDENTIFIED MALE: Well, we signed it in all cases, and I don't believe there are any other checks done.

LAWRENCE: But there are hardly any restrictions on buying this equipment in the U.S., so the distributors who sold to GAO's fake company didn't break any laws.

UNIDENTIFIED MALE: The scandal here may be what is legal, not what is illegal.

(END VIDEOTAPE)

LAWRENCE: Now, you're not allowed to export a lot of this stuff, but the GAO proved that's laughable. Investigators shipped fake, dummy versions of some of the chips and smart bomb equipment that they bought to a country in Southeast Asia, a country known to be a transit point for terrorists. And, Lou, they did it all from the post office and FedEx right here in Washington, D.C.

DOBBS: Quite a government, huh? Chris, thank you very much -- Chris Lawrence reporting from the Pentagon.

Other stories we're following here tonight -- the man authorities say tried to fake his own death is expected to plead guilty tomorrow to placing false distress calls and intentionally crashing an aircraft. Prosecutors say Marcus Schrenker left Indiana in his single-engine aircraft in January.

He then parachuted out of a plane in Alabama, fled on a motorcycle that he had hidden, and the plane then ran out of gas over the Florida panhandle and crashed. There were no injuries. Schrenker was on the run for days before finally federal marshals found him.

The Securities and Exchange Commission today charged the founder and former CEO of Countrywide with fraud -- the SEC charging Angelo Mozilo and two other former executives of Countrywide with deliberately misleading investors about the high risk of the company's mortgages. Mozilo is also charged with insider trading for selling his Countrywide stock for nearly $140 million.

In Massachusetts, a 12-year-old little leaguer has accomplished something few pitchers have ever done. Colby Gauge (ph), not only pitched a perfect game, he also struck out each and every batter he faced, 18 batters in a row, walked up to the plate, only to be sent right back to the dugout, striking out -- Gauge's team winning 13-0. Congratulations, Colby. And provocative new ideas tonight on how the Republican Party can reinvent itself as the grand new party and a showdown over Americans who want to bring same-sex partners into the United States. That's the subject of our "Face Off" debate.

(COMMERCIAL BREAK)

ANNOUNCER: Here again, Mr. Independent, Lou Dobbs.

DOBBS: A unique controversy unfolding in this country in the debate over immigration reform and gay rights. An immigration reform bill called the Uniting American Families Act seeks to grant legal residency to same-sex partners. While gay marriage advocates support the legislation, some of those seeking comprehensive immigration reform so-called say this bill will doom their cause. Lisa Sylvester has our report.

(BEGIN VIDEOTAPE)

LISA SYLVESTER, CNN CORRESPONDENT (voice-over): Congress has been here before, with three other attempts in recent years to pass comprehensive immigration reform. But an internal disagreement among key supporters is threatening to rip apart the coalition of proponents.

At issue, whether immigration benefits for married people should be extended to include same-sex couples. The U.S. Conference of Catholic Bishops and the National Hispanic Christian Leadership Conference have been staunch allies for immigration reform.

But a provision that allows gays and lesbians to sponsor their partners for permanent U.S. residency is not sitting well. Reverend Samuel Rodriguez says it's not only a moral issue but a political one.

REV. SAMUEL RODRIGUEZ, NATL. HISPANIC CHRISTIAN LEADERSHIP CONF.: And to include same-sex benefits, a cultural wedge issue that at the end of the day serve as the death knell to comprehensive immigration reform legislation I think works contrary to the cause of comprehensive immigration reform.

SYLVESTER: Representatives Mike Honda and Neil Abercrombie are among the co-sponsors of the bill which is being pushed by gay and lesbian groups. They point to cases like that of Shirley Tann (ph), an illegal alien from the Philippines who has been ordered to leave the country.

She and her American have twin sons. Honda and Abercrombie believe they can get comprehensive immigration reform passed even with the same-sex language included.

REP. NEIL ABERCROMBIE (D), HAWAII: We're not going to run away from people who are being discriminated against. Not in this country, not now, not forever.

SYLVESTER: There are an estimated 35,000 bi-national gay and lesbian couples who could be impacted by the proposed legislation. (END VIDEOTAPE)

SYLVESTER: Reverend Rodriguez says to get an immigration bill through Congress it's going to take the votes of the centrists or blue-dog Democrats, and including the same-sex provision in the bill he says will erode that support and without that support it will be nearly impossible to pass comprehensive immigration reform, Lou.

DOBBS: Lisa, thank you very much. Lisa Sylvester.

Well, the controversy over the "Uniting American Families Act" is the topic of tonight's face off debate.

Joining me now, former state department official, David Seminara who says the same-sex partner immigration legislation presents some insurmountable problems. Good to have you with us. And Congressman Jerrold Nadler, member of the House Judiciary Committee, who has sponsored the issue for years and says it needs to be passed and right away. Congressman, good to have you with us.

REP. JERROLD NADLER (D), HOUSE JUDICIARY COMMITTEE: Good to be here.

DOBBS: Let me begin with you. Federal law does not recognize same-sex partnership. Why should immigration and naturalization, why should that agency recognize it?

NADLER: Because the United States government should not be cruel to people except when absolutely necessary. And to keep loving couples apart, to say that you can't be with your -- with your -- with your partner in the United States or given the laws of the other country, your partner can't be with you in the other country, you can't be together at all, is simply cruel and it's inhuman and there's no reason to do it and the United States government should not work gratuitous cruelty.

DOBBS: Mr. Seminara, why do you say that's a bad idea on a humanitarian grounds as Congressman Nadler says, he makes a persuasive case?

DAVID SEMINARA, FORMER STATE DEPARTMENT OFFICIAL: Well, first of all, Lou, I'm not against the idea of same-sex marriages and civil unions -- excuse me -- civil unions or domestic partnerships. But I think the problem with this bill is that it puts the cart before the horse, in that it creates a relationship, legal status in immigration law that does not exist here in the United States and has simply no legal standing. It will create tremendous opportunities for fraud in the category of visas that's already ripe with abuse.

NADLER: With all due respect, that's nonsense. We do not have gay marriage. This is not part of the gay marriage debate. It is simply an attempt to stop being cruel to couples unnecessarily and to their children.

And with respect to fraud, you can have fraudulent shared marriages now. The same protections five years: in jail, $250,000 fine for a sham same-sex relationships for immigration purposes will deter exactly as effectively or as ineffectively as it deters it for heterosexual sham marriages now.

SEMINARA: But...

DOBBS: Go ahead, Dave.

SEMINARA: ...that's simply -- on paper it appears as though there are stern penalties for people who commit marriage fraud, but the reality of the situation, Lou, is that very, very few people ever go to prison for committing marriage fraud.

I'll give you an example, May of last year, a Lebanese immigrant in Michigan was -- she pled guilty for committing marriage fraud and she was actually a mole for Hezbollah. She'd gotten jobs in both the CIA and the FBI. And she was actually -- she pled guilty to marriage fraud and was fined only $750 and she didn't do a day of jail time. It's not a deterrent because...

NADLER: That may be an argument for harsher penalties or better enforcement of the laws respecting sponsoring partners, heterosexual partners, but it's not an argument against extending this law to gay couples. The law should be enforced.

DOBBS: If I may...

SEMINARA: Well -- sure.

DOBBS: I'm sorry, go ahead, Dave.

SEMINARA: Well, what I was going to say is, the major deterrent for Americans not to engage in a fraudulent marriage, either for money or for other reasons, is not the threat of going to jail, because very few people ever go to jail. The major deterrent is the legal entanglements that go along with marriage.

So that if I decide to marry someone in the Philippines, for example, for $10,000. What I would be most afraid of is that that person will come to the United States and then after two years when they get their Green Card they can divorce me and then take half of my assets. But with domestic partnerships, that threat isn't there.

DOBBS: Let's turn to the Conference of Catholic Bishops has come up, as you know, Congressman, against your bill, saying, in part, this: "While the bishops support many of the provisions in the Reuniting Families Act, your decision to include in the bill the Uniting American Families Act which would provide marriage-like immigration benefits to same-sex relationships makes it impossible for the bishops to support this year's version of your bill."

Well, let me just put it this way. I mean, do you think it makes sense to risk passage of the entire legislation?

NADLER: I think -- I think that whenever you're -- there's a question of egregious discrimination against a group, you must take on the issue head-on. For many years a former Congressman Adam Clayton Powell used to attach anti-discrimination, anti-Jim Crowe amendments to the legislation and he was considered wrong but he prevailed in the end. And everybody now says that was the right and moral thing to do.

I do think that given the small number of people involved, 35,000 couples altogether, maybe a couple hundred eventually a year once the backlog is taken care of, I hope that people when they see the overall bill and it satisfies them in many, many ways, will support this bill and we will pass it, despite this.

DOBBS: Let me ask you both this, because against the backdrop, and this is the part not under discussion, obviously, we're somewhere between 500,000 and a million people entering this country illegally every year, including overstaying their visas.

Against that backdrop of a total lack -- lack of enforcement of either border security or port security or U.S. immigration law, is this really a quibble really at the margin and one that is perhaps being overstated in its importance?

NADLER: Well, I would say that it...

SEMINARA: Not...

DOBBS: Go ahead.

NADLER: I would say that in terms of the opposition, yes, it's a quibble. It's a small number of people. And it's being overstated in terms of its importance, given all the statistics you just cited in terms of its impact on the country. In terms of its impact on American notions of fairness and in terms of its impact on the individuals involved, it's not a quibble.

DOBBS: Mr. Seminara.

SEMINARA: I absolutely disagree with that. Marriage to a U.S. citizen or green cardholder is by far the most common way for nationals to gain Green Cards. Last year alone there were over 400,000 foreign nationals that gained the Green Cards in this manner and it's also the number one program that's subject to the most fraud.

So this is by far the most common way for people living in other countries to either legalize their status in the U.S. or to come here as new arrivals, so this is...

NADLER: This is the current law. That's the current law.

DOBBS: I'm sorry, Congressman, we're going to have...

NADLER: What we're talking about is a very small addition.

DOBBS: Dave Seminara, thank you very much for being with us. We appreciate it.

SEMINARA: Thank you.

DOBBS: Congressman Jerrold Nadler, thank you for being with us. NADLER: You're quite welcome.

DOBBS: Still ahead, The "Buy American" provision in the federal stimulus package is now under attack by the "New York Times."

And why a Mexican company is about to build a brand new plant, but not in Mexico, here in the United States.

(COMMERCIAL BREAK)

DOBBS: The "Buy American" provision of the federal stimulus bill -- law is under attack. A "New York Times" editorial says the provision will end up costing as many American jobs as it creates.

Brooke Baldwin has our report.

(BEGIN VIDEOTAPE)

BROOKE BALDWIN, CNN CORRESPONDENT (voice-over): The United States of America, one of the most open markets in the world.

PETER MORICI, UNIVERSITY OF MARYLAND: We had a $700 billion trade deficit when the economy tumbled, and we lost 6 million jobs in manufacturing over the last eight years. Free trade has not done America's workers much good.

BALDWIN: Some argue one way for Americans to keep working? Buy American. It's a provision that was added to the economic stimulus bill earlier this year that applies to companies bidding on federal contracts. It requires them to buy products made in America by American-owned companies, using American labor, as long as international trade treaties are honored. But the "New York Times" argues, whether it is from the point of view of diplomacy or of job creation, "Buy American" is a terrible idea.

Canada thinks so, too, its iron and steel industry is urging the Canadian government to take up the issue with the U.S. Prime Minister Stephen Harper says his country is losing billions of dollars in bids.

STEPHEN HARPER, PRIME MINISTER OF CANADA: I do think that the proliferation of domestic preferences in sub-national government procurement is really problematic. It's part of the creeping protectionism.

BALDWIN: Keep in mind America's trade deficit in Canada when NAFTA was signed was almost $11 billion. In 2008? It was more than $74 billion.

SEN. BYRON DORGAN (D) NORTH DAKOTA: It is unbelievable to me, we've had $700 billion and $800 billion a year trade deficits and other countries are upset? They're the beneficiaries of this. They're the ones that have in many cases closed their markets even as they've accessed our markets. Let's have a little fairness.

BALDWIN: The North Dakota Democrat said Americans cannot be embarrassed by the need to put Americans back to work on American factory floors once again.

(END VIDEOTAPE)

BALDWIN: And it just so happens, today the lobby group for Canadian manufacturers sent a letter to the prime minister asking him to talk to President Barack Obama as soon as possible. What do they want? An exemption from the buy-American provision and as it just so happens, both President Obama and Prime Minister Harper will be in France Saturday for the 65th anniversary of D-Day, and perhaps, Lou, they'll be talking trade in Normandy.

DOBBS: A $75 billion trade surplus with the Canadians is not adequate?

BALDWIN: No.

DOBBS: All right. Thank you very much.

BALDWIN: Thank you.

DOBBS: Appreciate it. Brooke Baldwin.

In Louisiana, a new textile plant is opening there. And it's owned by a company from Mexico that says it will hire American workers.

Sean Callebs has our report.

(BEGIN VIDEOTAPE)

SEAN CALLEBS, CNN CORRESPONDENT (voice-over): You don't see a lot of this these days; construction winding up on a brand new factory -- a textile plant in southwest Louisiana that will provide about 75 well-paid jobs. The American dream, right, flying in the face of the recession to prove good old USA ingenuity and grit can make it happen. Except, it's not an American company pulling the strings; a yarn company from Mexico is moving in.

RAPHAEL ZAGA, OWNER, GRUPO ZAGA: This is very exciting. It's a dream come true. Less than 60 days ready to start producing yarn and to try export to every part of the world, so we are very, very excited.

CALLEBS: The plan is to open the factory in late July or early August.

(on camera): That's right, a Mexican company is moving here, not the other way around. The Zaga family says they can do it because this factory is going to be located near U.S. cotton fields, so they'll save money and no longer have to export cotton hundreds of miles into Mexico. They say they'll also save money on shipping, because it will be located close to major ports and rail lines.

(voice-over): The Zaga Yarn Factory is going up on the edge of an industrial park in Lacassine, Louisiana, a town so small it doesn't have a mayor. School board member Julius Caraway and the principal of the one school in town, David Troutman, have concerns.

To locals what's been going on behind this fence has been a big mystery.

DAVID TROUTMAN, PRINCIPAL, LACASSINE HIGH: I haven't seen any job applications, you know...

CALLEBS: Floating around.

TROUTMAN: ...floating around or advertisement that they need x amount of these kind of workers or those kind of workers, you know, I haven't seen any of that.

JULIUS CARAWAY, LACASSINE SCHOOL BOARD MEMBER: We want to put our people to work. We don't mind others coming in, but we'd like to put some of our people to work, too.

CALLEBS: Locals are worried the Zagas will do all their hiring from Mexico. Fearful the Lacassine area will not only lose out on jobs but also concerned that schools, utilities and other essential services may be overwhelmed.

In an effort to allay such worries, the Zagas told me something they haven't told the locals.

ZAGA: All the workers will be from here. What we are doing here is putting the plant and putting the friends here, the people will be locals from here.

CALLEBS (on camera): a lot of local residents like to say this country was built with a can-do spirit and they want to know why a Mexican factory can do what many U.S. companies say they can't right now, and that is build a state of the art facility, employ scores of people and make a profit, all in a down economy.

CARAWAY: Everybody's saying the loss of industry from the United States moved to other countries because of cheaper labor.

CALLEBS (voice-over): The Zagas say jobs will pay between $10 and $15 an hour and maintain that all employees will come from the surrounding area. If true, Lacassine residents say it would be the American dream, even if that dream would be stamped, "Made in Mexico."

Sean Callebs, CNN, Lacassine, Louisiana.

(END VIDEOTAPE)

DOBBS: Coming up at the top of the hour, Campbell Brown -- Campbell.

CAMPBELL BROWN, CNN ANCHOR, "NO BIAS, NO BULL": Hey there, Lou.

The president, of course, as you know, in Germany now, after giving this groundbreaking speech in Cairo, calling for a new relationship between the U.S. and the Islamic world. We're going to play a lot more than just sound bites. We'll also look at whether the president's speech made the U.S. Look weaker or stronger.

Plus, tonight's great debate, can moderate Muslims defeat extremists. Two sides are going to square off at the top of the hour -- Lou.

DOBBS: Oh, joy. Campbell, thank you.

Up next here, two of the nation's leading journalists offer their ideas for a new Republican Party.

(COMMERCIAL BREAK)

DOBBS: The Republican Party for some time has been a party in search of both a leader and an agenda. My next two guests have some ideas to help. "New York Times" columnist Ross Douthat and Reihan Salam of "Atlantic" magazine; they are the co-authors of the book "Grand New Party: How Republicans can win the working class and save the American dream." Great to have you both here.

ROSS DOUTHAT, COLUMNIST, "NEW YORK TIMES": Thanks for having us.

DOBBS: Let me ask first -- as we begin -- just how tough do you think this assignment is, how likely that the Republicans can turn things around, say, before 2010?

DOUTHAT: Well, it's going to be tough, Lou. I think Republicans need to look hard in the mirror and they need to realize there are a lot of trends running against them.

If you look at the sections of the American population that are growing, they're almost all sections that Republicans are losing. If you look across the board, the Democratic Party seems to be going from strength to strength. We are not under any illusions that this is an easy job.

The goal, I think, is to make sure that it's not 10 or 15 years in the wilderness, that it's two, four or six years.

DOBBS: As we talk about the working class, working men and women, the middle class, as you and I have discussed before, it's seldom I hear a Republican at any time talking about working men and women. They'll talk about jobs that are created by American business, but they don't talk about the man and the woman doing those jobs with a personal connection, the way in which Democrats have. Can that be overcome? Can that be changed?

REIHAN SALAM, "THE ATLANTIC": You know something? That was the big liability in 2008. Far more Americans believe Barack Obama understood where they were coming from economically and they simply thought that John McCain was out of touch.

That is not a matter of policy. It's a matter of gut-level connection -- do you get it or do you not? I think that what the Republicans really need is a generation of politicians who seem to get it. I think that the irony is that Republicans really are the party of the American middle. They're not the party of the poor, they're not the party of the rich, so much as they are the party of, as you suggest, those working class folks.

Why can't they speak to them? That's something that fortunately, I think, is starting to change. You are seeing the gap between Democrats and Republicans in the poll numbers start to close. You're also seeing Republicans starting to offer smarter solutions on health care, something that you've talked a fair bit about. I think I'm actually pretty optimistic about Republican prospects going forward.

DOBBS: One of those -- well, one part of those prospects improving, as you both know so well. Let me quote here, "the cliche is that politics is about addition, and the GOP needs to add more Hispanics or gays or women to its coalition. Republicans will never win that fight. Conservatives must argue why they are right, not endlessly apologize for their alleged wrongs." Do you concur?

DOUTHAT: I do, up to a point. I think whoever said that was astute in the sense that when you are crafting a political agenda, you can't just narrowly target it to a series of discreet, ethnic, religious, social groups, whatever. You need an agenda that speaks to all Americans. That's the problem the Democrats ran into in the '80s and '90s. They seemed more like a coalition of vulcanized groups than a real political party.

However, the problem for Republicans is that often they want to argue that they're right about issues that voters don't really want to talk about. Republicans are very good at talking about national security. They are not as good at talking about -- as Reihan says -- about health care, about education, about jobs. That's the challenge for the party.

Argue that you're right, but argue that you're right on issues Americans are focused on.

DOBBS: And I should point out, that was Jonah Goldberg, "Los Angeles Times" columnist who wrote that.

As you look at the Republican Party, we are talking 10, 15 years to turn around. There are people around the country right now trying to assimilate this, that is, in the most recent polls that 36 percent of Americans identify themselves as independent, guys. 35 percent identify themselves as Democrats, and only 23 percent identify themselves as Republicans. That is real uphill work.

There are those, let me say, who are independents, if I may, who are not discouraged in any way that there are fewer people applying themselves as both Democrats and Republicans.

SALAM: Well, this is just the new politics we have in America right now. It's much more fluid. A lot of those folks who are independents now were Republicans in the '90s and the '80s. The Republican Party can win them back, but it has to win them back not through a naked appeal of partisan loyalty, but on the basis of real substantive policies.

I think that that's where the Republicans are headed, provided we get past some of these side shows about Sonia Sotomayor and whatever is the flavor of the month, political gimmick. I think that the party really needs to get those core issues right. And they are starting to do that.

DOBBS: Is it helpful that there is a contest between Rush Limbaugh, Dick Cheney and Michael Steel as leader of the Republican Party right now?

DOUTHAT: I mean, no, probably not. I think that people can overestimate the significance of the whole war over whether Rush Limbaugh is the head of the Republican Party when 2010 and 2012 roll around. Voters aren't going to be concerned about that.

What you do see there is a problem facing any political party that's lost a couple of elections, which is to say, one, its normal leaders aren't there because the party has been losing. Two, it's gotten smaller. So figures like Limbaugh -- Limbaugh plays a very valuable role in the conservative coalition, but his role is to preach to the converted. It's not to win new converts. As the party shrinks and his voice gets louder, it can be a problem.

DOBBS: That is a very interesting point, Ross. Thank you very much Ross Douthat. Reihan Salam, thank you very much.

SALAM: Thank you.

DOUTHAT: Thank you.

DOBBS: The "Grand New Party." It will be interesting to see if the party pays attention, gentlemen. Thanks for being here.

Tonight's poll results are next and some of your thoughts.

(COMMERCIAL BREAK)

DOBBS: Tonight's poll results, 67 percent of you say you are concerned that President Obama seemed compelled to continue to apologize for the United States whenever he travels abroad.

Time now for some of your thoughts.

James in Virginia said, "The second amendment secures the right for law-abiding citizens to possess firearms. State and local authorities cannot abridge that right. If the courts rule to the contrary, might they next restrict free speech?"

Rick in Indiana, "Lou, the second amendment is a fundamental right, but it seems like it's the law-abiding citizen that is always penalized. I enjoy your show. You always keep me thinking. Keep up the good work."

We'll try.

William in Indiana, "The United States is a special place where a responsible person has the right to keep and have arms in their home. Why do we have to fight for this right year after year?" Michael in New Hampshire, "This administration is failing us already. China steals our technologies, pirates our music and movies, manipulates their currency to devalue ours, hacks our defense computers and our government speaks to them like they are a great ally."

Zane in Arizona, "Thank you for your coverage on our unsecured borders. I live in southeast Arizona where we are affected by choices made by someone 2,500 miles away in D.C. If they want the real picture of what goes on, they can sleep on my couch for a week."

Send us your thoughts to loudobds.com. Each of you whose email is read here receives a copy of my book "Independents Day."

And please join me on the radio Monday through Fridays for "The Lou Dobbs Show" 2:00 to 4:00 p.m. each afternoon on WOR 710 Radio in New York. Go to loudobbsradio.com to get the local listings in your area for the show.

Thanks for being with us tonight. Join us here tomorrow. For all of us, thank you for watching.

Good night from New York.

Now, Campbell Brown.

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