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Lou Dobbs Tonight
Bush: Tax Cuts Will Drive Economy; Interview With John Snow
Aired June 17, 2003 - 18:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
ANNOUNCER: This is LOU DOBBS TONIGHT for Tuesday, June 17. Here now Lou Dobbs.
LOU DOBBS, CNN ANCHOR: Good evening everyone.
Better days ahead. Today the White House said this economy will grow stronger in the second half of the year. President Bush said the tax cuts just approved by Congress will drive the economy.
White House Correspondent Suzanne Malveaux joins us live now -- Suzanne.
SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT: Well, Lou, very much President Bush looking and sounding like candidate Bush.
Earlier today at a community college in Virginia, the big focus, the big push of course is the economy. White House aides say that despite his post-war popularity they know that this is the one issue that really resonates with voters.
The latest poll showing some 30 percent say the economy is the most important problem, 12 percent say it's unemployment, but the White House, of course, realizing they not only have to strengthen the economy but also make sure that voters sort of see that it's Bush's policy that is responsible for these improvements.
The Bush administration aides today stressing really the economic indicators painting a rosy picture, saying that the inflation rate is flat, they expect better growth in the second part of the year and, of course, Bush aides want that the president gets the credit for the recovery.
(BEGIN VIDEO CLIP)
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: The Jobs in Growth bill will pass back money to the people who sent the money to Washington in the first place and it will help with a -- it helps because when people have more money in their pocket they're going to demand an additional good or a service and we need an increased demand in a sluggish economy and when somebody demands an additional good or a service in our economy, somebody is going to produce that good or a service, and when that happens someone is likely to find work. The Jobs in Growth bill came at the right time.
(END VIDEO CLIP) MALVEAUX: And, Lou, also the right time the administration feels for fund-raising. President Bush tonight kicking off a huge fund- raising blitz, it's a $2,000 a plate dinner this evening in Washington. It's expected he is going to break all fund-raising records, including his own, perhaps as much as $250 million in the next couple of months -- Lou.
DOBBS: Money the order of the day with the White House. Suzanne, thank you very much, Suzanne Malveaux.
Well, earlier I talked with Treasury Secretary John Snow who said this economy is already in recovery and growth will pick up soon.
(BEGIN VIDEO CLIP)
JOHN SNOW, TREASURY SECRETARY: I think we're seeing already some positive signs, the stock market, some better news coming out of the manufacturing sector, and we're looking at the growth rates for the second half that are going to be a nice pickup over the first half.
(END VIDEO CLIP)
DOBBS: And we'll have the interview with Secretary Snow at the money summit later in the show.
Turning now to the Middle East, the White House today stepped up its efforts to sell the road map for Middle East peace to Israeli and Palestinian leaders. The State Department said Secretary of State Colin Powell will arrive in Jerusalem Friday. The secretary is expected to meet with Israeli Prime Minister Ariel Sharon and Palestinian leaders. Secretary Powell will then travel to Jordan.
The Bush administration's new Middle East envoy is already there. Assistant Secretary of State John Wolf and Palestinian Prime Minister Mahmoud Abbas met for the first time in Gaza City today. Abbas also met with Palestinian militant groups. He urged them to declare a cease-fire with Israel. Hours later, a seven-year-old Israeli girl was killed in a shooting in the West Bank.
Matthew Chance joins us live now from Gaza with the very latest -- Matthew.
MATTHEW CHANCE, CNN CORRESPONDENT: Lou, thank you.
More tragedy and more bloodshed in the Israeli-Palestinian conflict that as talks with the main Palestinian groups here and the Palestinian Prime Minister Mahmoud Abbas to try and declare a cease- fire with the Israelis end here in Gaza without any breakthrough.
We'll start, though, with the latest violence. And Israeli ambulance workers tell us, as you mentioned, a seven-year-old Israeli girl has been killed near the West Bank town of Kalkilya when a car in which she was traveling was shot at by unidentified gunmen. Officials also say that her five-year-old sister has also been critically injured, her father also lightly injured in that attack. We don't have much more information at this stage but, obviously, we'll bring you more as soon as it comes through to us, but this latest violence of course only underlines just how urgent is the need here for a cease-fire in this conflict.
The Palestinian prime minister, as I mentioned, Mahmoud Abbas, has been meeting with the main Palestinian militant groups here in Gaza urging them to stop their campaign of violence against Israelis.
But what they're saying is that without concrete guarantees from the Israelis that Israel will suspend its policy of assassinating leaders of the militant groups, Hamas and Islamic Jihad saying until that happens they will keep up what they call their resistance to Israeli occupation. What that means is that the violence, the bloodshed will carry on.
DOBBS: Matthew, thank you very much, Matthew Chance reporting from Gaza.
In Iraq today, an Iraqi sniper shot and killed an American soldier in Baghdad. He was the 50th U.S. serviceman to die in Iraq since the first of May. The shooting came as Operation Desert Scorpion entered its third day.
The crackdown against anti-American paramilitary fighters and Iraqis loyal to Saddam Hussein has resulted in the arrests of more than 400 people. Soldiers on those raids also saw combat in the war and hoped to be home by now but the army says it doesn't have enough troops to replace them.
Our Senior Pentagon correspondent Jamie McIntyre joins us live with the story -- Jamie.
JAMIE MCINTYRE, CNN SR. PENTAGON CORRESPONDENT: Well, Lou, because of ballooning global commitments, the U.S. Army is fresh out of reinforcements. Most of the soldiers now in Iraq can expect a nine-month tour of duty even those who have already served in Afghanistan. Soldiers of the 3rd Infantry Division who bore the brunt of the initial combat are needless to say disappointed.
(BEGIN VIDEO CLIP)
SGT. JEFFREY ELLIS, ALPHA COMPANY GUNNER: They expected us to come straight home. It's real hard on like my girlfriend.
CAPT. ANDY HILMES, COMPANY COMMANDER: I'm not going to lie. I'm not going to sugar coat anything. The guys were devastated. I personally was devastated, you know. We all have family back home waiting on us.
UNIDENTIFIED MALE: I was a little irritated, you know. It seems like there's plenty of other soldiers to do it. Why do we have to do it?
(END VIDEO CLIP) MCINTYRE: In 1991, when the Army sent the equivalent of eight divisions to Iraq it still had ten divisions left. Now, the Army has ten divisions total and only one, the 1st Cavalry Division in Fort Hood, Texas is complete and ready for deployment on short notice.
At his retirement last week, Army Chief of Staff General Eric Shinseki, who infuriated the Pentagon with his prewar prediction it would take several hundred thousand troops to secure Iraq, delivered something of a parting shot. "The Army" he charged "is two divisions short."
(BEGIN VIDEO CLIP)
GEN. ERIC SHINSEKI, U.S. ARMY CHIEF OF STAFF: Beware the 12 division strategy for a ten division Army. Our soldiers and families bear the risk and hardship of carrying a mission load that exceeds what force capabilities we can sustain.
(END VIDEO CLIP)
MCINTYRE: The Pentagon insists the problem isn't that the Army is too small but rather that too many U.S. military personnel, 320,000 by one estimate, are doing jobs that should be done by civilians -- Lou.
DOBBS: A remarkable piece of reasoning, Jamie. The fact remains that the forces were cut by half over the course of the time between this and the last war in Iraq. Is there any sign that Secretary Rumsfeld, the Pentagon, are going to seriously address the fact that U.S. forces are stretched too think around the world, not only in Iraq?
MCINTYRE: Well, you know it's interesting, Lou, because during the campaign candidate Bush and his campaign staff sharply criticized the Clinton administration for cutting the Army by two divisions from 12 to ten saying that was too deep, but once they got in office the administration wasn't interested in increasing the Army's manpower in fact, they talked about cuts.
That, of course, all changed on September 11 but the Pentagon continues to talk about trying to get, increase the manpower and the combat strength by shifting more of the administrative jobs to the private sector and not adding to what they call the end strength or the overall size of the U.S. military.
DOBBS: And, Jamie, the Pentagon today released more information about the ambush of the Army unit that Private Jessica Lynch was part of. Tell us about that.
MCINTYRE: Well, we're not learning a lot more but we have learned a little bit more about the raid that happened that day, the ambush that happened that day to the maintenance convoy that Jessica Lynch was a part of and one of the things that we discovered is that there was quite a bit of heroism that day as those Army troops fought off Iraqi attackers near Nasiriya. The vehicle that Jessica Lynch was traveling in was hit apparently by a rocket-propelled grenade and turned over. This is when they made essentially a wrong turn in the desert and ended up in hostile territory. Jessica Lynch, we're told, doesn't really remember anything from that point until she woke up in an Iraqi hospital.
But other members who survived that ordeal have told stories of other soldiers firing a lot of ammunition, fighting to the point where they had no more fight left to give before sustaining fairly heavy casualties -- Lou.
DOBBS: Jamie, thank you and Private Lynch has been in hospital now for more than two months. Jamie, thank you very much, Jamie McIntyre our Senior Pentagon Correspondent.
Still ahead here tonight, nuclear threat, Iran, nuclear weapons, and international pressure, former defense secretary and our regular contributor William Cohen will join us.
And, it's high noon in Houston, an angry showdown between energy giant El Paso and its shareholders some of whom are attempting a coup. Casey Wian is live in Houston. He'll have the story for us next. Stay with us.
(COMMERCIAL BREAK)
DOBBS: Our e-mail boxes seem to be filled with increasing amounts of spam. It is becoming one of the greatest aggravations of modern cyber life in this country. Microsoft has now launched an offensive against the relentless public enemy.
Katharine Barrett joins us now from Seattle, Washington with the very latest -- Katherine.
KATHARINE BARRETT, CNN CORRESPONDENT: That's right, Lou.
Microsoft is attempting to drag deceptive spammers out of the shadows of cyberspace and straight into court. They filed today 15 lawsuits against spammers accused of flooding the company's e-mail systems with as many as two billion pieces of deceptive and offensive mailing. Another two lawsuits were filed today in the United Kingdom on a similar matter.
That legal action is just part of an all-out offensive against spam on legal, technical, and political arenas. Microsoft joins other e-mail services, e-mail providers in taking spammers to court.
Earlier this year, AOL, parent of course of this company, sued over 100 spam senders. Earthlink has also pursued spammers on criminal charges. Still, many others are operating though beyond the reach of U.S. law coming out of countries like China, which makes them much harder to pursue.
One Microsoft software engineer I spoke with today just a short while ago called this nothing short of a war between the spammers and anti-spammers who are working as fast as they can on a technical level to block these e-mails. But the volume of spam soared 85 percent in the past year. E-mail system servers already filter out about 40 to 70 percent of what comes in as spam each day.
But joining Microsoft today at its press conference was Washington State's attorney general. She pointed out that some of what still gets through is far worse than merely inconvenient.
(BEGIN VIDEO CLIP)
CHRISTINE GREGOIRE, WASHINGTON STATE ATTY. GENERAL: Some 20 percent of spam is where we're getting pornography from. That's coming into the homes of families who don't want to see that sort of thing in their home for their children let alone for themselves. Ninety percent of the viruses are passed on by spam so it's not just a nuisance. It's a huge cost to business. It's a cost and an annoyance to consumers.
(END VIDEO CLIP)
BARRETT: And, in a letter to Congress earlier this spring, Microsoft founder Bill Gates called spam a threat to the viability of e-mail as a method of communications -- Lou.
DOBBS: Katharine, it's not our imagination when we think that our e-mail boxes are being filled with more and more spam.
BARRETT: No, to some extent it's a numbers game. The spammers know that even if they get a tiny fraction through they just have to send more, throw more at the system.
DOBBS: Katharine, thank you very much, Katharine Barrett from Seattle, Washington tonight.
BARRETT: My pleasure.
DOBBS: On Wall Street today, stocks rose for the fifth time in the past six sessions. Stocks closed just slightly higher, the Dow up four points, the NASDAQ rose two points, the S&P skyrocketed almost a point.
Susan Lisovicz is here now with the market for us tonight, Susan a little gain but a gain is a gain.
SUSAN LISOVICZ, CNN CORRESPONDENT: A little gain is a gain and after yesterday's huge gain it's kind of a surprise to some people who are watching the market.
Lou, investors buying for a second day on upbeat information on the state of the economy. It's not often that inflation is considered a friend but given the concerns about deflation the largest jump in the core consumer price index since last August was viewed by Wall Street as a positive.
Industrial production exceeded expectations of a flat reading, and Americans continue to rush into the housing market. Housing starts surged six percent in May. Pfizer, the most actively traded issue on the big board extended its gains another 4.5 percent on bullish earnings forecasts.
Electronics retailer Circuit City added more than 13 percent after narrowing its quarterly loss.
Microsoft which, Lou as you just mentioned, is stepping up its legal battle against spam closed up better than half a buck.
On the losing side, Coke shed two percent on word of an informal inquiry by the SEC into allegations of deceptive marketing and accounting practices raised in a suit filed against the company last month.
AT&T fell nearly five percent on the day after a downgrade to sell from Merrill Lynch which cited increased competition and dissatisfaction with its recovery in enterprise systems. AT&T the biggest drag on the Dow although the index still managed to eke out a gain.
Declining issues, however, edged out advancers at the NYSE, and volume which was below average yesterday, Lou, picked up today coming in at nearly 1.5 billion shares.
DOBBS: That's a pretty good pickup from 1.3 yesterday.
LISOVICZ: And, yes, all three major indices up better than 2.25 percent yesterday.
DOBBS: Terrific. Thanks very much Susan Lisovicz.
Former Rite-Aid Chief Executive Martin Grass today agreed to plead guilty to two counts of conspiracy. That deal calls for an eight year prison sentence. Grass will pay $3.5 million.
He was indicted last year along with three other Rite-Aid executives. His trial had been scheduled to begin next week. Grass is one of 73 executives in all of corporate America now to be charged with some form of criminal wrongdoing, 16 of those from Enron.
If the deal is accepted, Grass will become the second executive to be sent to jail. So far, ImClone's Sam Waksal is the only executive sentenced to jail throughout this corporate corruption scandal which began 561 days ago when Enron filed for bankruptcy.
Coming up next tonight, attention sport utility drivers, new crash tests rate the best and the worst in SUVs and there's more bad than good.
Emerging diseases, our series of special reports this week, tonight we focus on monkeypox. Kitty Pilgrim will report. That's coming up. Stay with us.
(COMMERCIAL BREAK)
DOBBS: The Insurance Institute today released the results of its first ever side impact crash test for sport utility vehicles. The test ranked 12 small SUVs following a 30-mile-an-hour impact to the driver's side.
The top two performers the Subaru Forester, side airbags, and the Ford Escape with side airbags, the Forester is the only one of the SUVs which earned a top rating in the side and frontal crash tests. Among the worst performers in the side impact test Mitsubishi's Outlander, Toyota's RAV4, and the For Escape without side airbags.
Kathleen Koch joins us now from Ruckersville, Virginia, with more on the story. Kathleen, these are concerning test results at the least I would think.
KATHLEEN KOCH, CNN CORRESPONDENT: They are and what the Insurance Institute was trying to do, Lou was to replicate the kind of crash we see on our roads every day, that's an SUV or a pickup broad- siding another vehicle.
They created a special barrier to use and here it is. You can see that it's much taller and much more contoured than the very low and relatively flat fronted barrier the federal government has been using in its tests for years.
Let's take a look at the crash test of a Subaru Forester, the one you said rated the top in this test. Now when the barrier crashes into it at 31 miles per hour, yes, it is a violent crash but still nonetheless the driver of this vehicle would likely have survived.
David Zuby is here from the Insurance Institute, David what made the difference?
DAVID ZUBY, INSUR. INST. FOR HIGHWAY SAFETY: Well, the big difference is that the Forester comes equipped with a standard side airbag that offers protection for both the chest and the head. So, when a moving barrier struck the side of the Forester, this airbag deployed from inside the seat, inflated with air and cushioned the dummy's head and chest from the intruding side structure.
KOCH: Saving the driver's life. Now, the same thing did not happen, though, in many of these tests where the vehicles failed. Let's take a look at the Mitsubishi Outlander now. That Outlander did not have an airbag for the dummy that was in the front seat and you can see a huge difference. David, tell us what happened in this case.
ZUBY: That's right. Obviously there's no side airbag here and, in addition, we've got a fair amount of more intrusion into this structure, so when the barrier came in and pushed against the door of the Mitsubishi Outlander, it went straight in and hit the dummy itself. The dummy's head hit the barrier.
We measured very high forces that would indicate a severe risk of a serious injury. We also measured significant crushing of the dummy's chest indicating that had that been a person they would have suffered serious chest injuries.
KOCH: They might have died. David, now obviously let's take a look at one vehicle that interestingly both was the best and the worst, the Ford Escape. If we can play that video you'll see a side- by-side comparison of the close shot of the head of the dummy where there was an airbag and then the Ford Escape where there was not. Tell us how much of a difference these airbags are really making, these side airbags.
ZUBY: Well, this test is a good example of how much difference the airbag by itself can make because you've got the exact same vehicle. The only difference is the airbag. The outcome for the rear seat passenger was exactly the same. The structure deformed exactly the same.
In the case of the test without the airbag, the driver would have suffered serious injuries whereas in the case with the airbag the driver is protected from those serious injuries and may well have walked away from that crash.
KOCH: David Zuby, thank you very much.
And, Lou, it's important to point out that Mitsubishi is among the manufacturers who say they believe that this is a very extreme test. It's not yet been accepted by any of the auto makers or by the federal government and they believe that their vehicles, as they say, comply with all federal safety standards -- back to you.
DOBBS: Kathleen, thank you very much, Kathleen Koch from Ruckersville, Virginia.
That brings us to tonight's poll. "What do you look for first when you buy a car, safety, style, fuel efficiency, or price?" Cast your vote at cnn.com/lou. We'll have preliminary results in the polling later in the show.
Now the final results of yesterday's poll. The question, "What do you think of the recent stock market rally?" Fifteen percent of you said too much too soon, 48 percent said downdraft ahead, 20 percent said just what we needed, 17 percent said even more to come.
Our nightly check on the national debt now, tonight it stands at almost $6,600,000,000,000. The debt has risen almost $16 billion from just last night.
When we continue here, monkeypox, in our series of special reports on emerging diseases, Kitty Pilgrim will examine the latest threat through the eyes of one of its youngest victims.
And, shareholders revolt in Houston; investors try a coup in El Paso and at El Paso. We'll have a live report for you. Stay with us.
(COMMERCIAL BREAK)
DOBBS: Millions of Americans suffer from depression and according to a new study more than half of them receive inadequate care.
Medical Correspondent Elizabeth Cohen joins us now with more on this new study -- Elizabeth.
ELIZABETH COHEN, CNN MEDICAL CORRESPONDENT: Lou, this is a major new study coming out of Harvard University and what they found is that one out of six Americans suffers from depression. This is a huge number, bigger than what other studies have found in the past and, that as you said most of them are not getting adequate treatment.
Let's take a look at the specific numbers. What they found is that four out of five patients received inadequate treatment and they looked at 9,000 patients so that's a big study.
First of all there were drug dosage problems. People were getting wrong dosages of the anti-depression drugs. Also, the patients were just sort of on their own discontinuing treatment, and also that patients were using unproven treatments. Rather than going to the doctor and getting a prescription, they were just sort of trying whatever they thought might work.
The bottom line of the study, according to the author who wrote it, he said look depression is a disease and people need to start treating it more like a disease. If you had cancer you wouldn't treat that on your own and people shouldn't try to treat depression on their own. They need to go see their doctor and the stigma needs to come off of depression -- Lou.
DOBBS: Elizabeth, that's a fascinating study. At the same time, it leaves a difficult question that's persisted for some time. How does one know whether one is just having a bad day, feeling a little let down, or clinically depressed?
COHEN: Right, there are very specific things that people can look for. There's a long list of symptoms and I'll read them in a second, and what you need to say is out of all these symptoms am I experiencing at least five of them every day for two weeks?
So, let's take a look at what the specific symptoms are. They are: decreased interest or pleasure in activities; appetite change with weight gain or weight loss; decreased or increased sleeping; fatigue or loss of energy; feeling worthless or guilty; being either agitated or slowed down; difficulty thinking or concentrated; and recurrent thoughts of death or suicide.
And, again, this isn't just sort of feeling one of these Monday and not feeling them Tuesday. That wouldn't be clinical depression. It would be feeling at least five of these things every day for two weeks or more -- Lou.
DOBBS: Elizabeth Cohen, thank you very much.
Health officials today confirmed that a Kansas woman has that state's first case of monkeypox. It's also the first case west of the Mississippi River. The woman was bitten by a prairie dog about two weeks ago while she was in Missouri. Fifteen other cases of monkeypox have been confirmed nationwide. Another 81 cases are now under investigation.
As part of our continuing series this week on emerging diseases, Kitty Pilgrim now looks at the spread of monkeypox.
(BEGIN VIDEOTAPE)
KITTY PILGRIM, CNN CORRESPONDENT: It started innocently enough. Three-year-old Cheyenne Kautzer got two prairie dogs from a 4-H Club swap meet in Wisconsin but one of the prairie dogs bit the child and she became the first person in this country to be confirmed with monkeypox.
TAMMY KAUTZER: Her eye was almost completely swollen. She had bumps on her body. Her glands were sticking out of her neck where you could actually see them. For the first three days I was scared. I didn't know whether she was going to make it.
PILGRIM: Both her mother and father also came down with the disease. The prairie dog died and the second prairie dog also became ill. The Marshfield Clinic in central Wisconsin was frantic to find what caused the sickness. They knew it came from the animal but realized it could also be spread person-to-person.
DR. KURT REED, MARSHFIELD CLINIC RESEARCH FOUNDATION: I really couldn't find anything and so we wondered are we dealing with a virus from North America that just hasn't been previously reporte or characterized.
At that point we had no knowledge about exposure to animals from western Africa.
PILGRIM: That is exactly what they had. Monkeypox is a western African disease, never before seen in the Western Hemisphere. Originally found in monkeys, it's related to smallpox and passes from animal to animal, or animal to human. The prairie dogs have been traced to an Illinois pet shop and are thought to have been infected by an African giant rat. So far the outbreak has been relatively contained to midwestern states. Wisconsin reported 34 cases, Illinois, 19, Indiana, 24, Missouri, one, and Ohio, two. Dr. Byron Dilenival (ph) is on exotic pet veterinarian. He says the mass wholesale of exotic animals is a problem.
UNIDENTIFIED MALE: It's when they go through those distributors or wholesalers they come in contact with more exotic species, like the Gambian rat, things from outside this country. Then act as a vector to then transmit it to humans or other animals.
PILGRIM: Some experts worry the country's borders are too open to animals with infectious diseases and consumers overlook the diseases exotic animal can carry.
JEFF BENDER, UNIVERSITY OF MINNESOTA: Thousands of animals pass our borders through our ports of quarantine. If there is a take-home message, it's that there are some pets that are more appropriate than others. There are some pets that -- or some animals that really don't make good pets.
(END VIDEOTAPE) PILGRIM: Cheyenne, by the way, has recovered and now has a new puppy. Monkeypox can be fatal. No one in this country has died of the disease but the sale of prairie dogs is now banned in the country. And it is a crime in some states to release them into the wild -- Lou.
DOBBS: Is it only the prairie dogs carrying this disease?
PILGRIM: So far, yes. But there is great concern that some animals may have been in close approximate to these prairie dogs in pet stores so it's on going investigation. They say keep your eyes open for all symptoms in new pets.
DOBBS: I think this is where we say, oh great.
OK, Kitty, thanks. Kitty Pilgrim.
Another person has died from the SARS virus in Canada. The 67- year-old man died yesterday in the Toronto area, the country's first death to the virus since June 7. Thirty-Four Canadians have now died from the SARS virus.
Earlier today the World Health Organization said the virus has been stopped dead in its tracks. That, their words, saying it is absolutely under control, at least for now. The agency, however, added that a single imported case or lapse in infection control could reignite an outbreak. That announcement came as the WHO lifted the travel advisory for Taiwan. An advisory still remains in place for Beijing. The disease has killed more than 800 people, sickened more than 8,000 world wide since being detected last fall in China.
We'll continue our special report on emerging diseases tomorrow here with a closer look at the SARS virus. In addition, we'll be joined by one of the leading experts in the field of viruses. Dr. Beatice Han (ph) will discuss how many emerging diseases such as SARS are jumping from animals to humans and the threat they pose to all of us. That's tomorrow, 6:00 p.m. Eastern here on CNN.
And it brings us to our "Thought of the Day" on illnesses.
"A disease known is half cured. That reassuring note from British author and scholar Thomas Fuller.
The United Nations nuclear watch dog group wants access to those Iranian nuclear facilities without prior notice. Iran says the price for that kind of access would be more advanced nuclear technology. Iran's nuclear program is at the center of discussion this week in Vienna.
And joining us now to further this discuss this debate is former defense Secretary William Cohen in our Washington, D.C. studios.
Bill, good to have you here.
WILLIAM COHEN, FMR. DEFENSE SECRETARY: Good evening, Lou.
This is starting to have some resonance to the North Korean position, is it not?
COHEN: I think we've known for sometime that Iran was on a course to develop a nuclear capability. It's one of the reasons why the administration had protested to Russian leader Putin and to the Chinese and others to prevent the flow of that technology moving into Iran. Most recently, you had the Atomic Energy Inspector or official, I should say, ElBaradei, who indicated during a tour that Iran failed to disclose that they had imported certain nuclear materials and had reprocessed them, calling now for a much closer intrusive inspection on certain facilities. So I think this is building now. Certainly the E.U. is concerned, as well as the IAEA, which is the Atomic Energy Inspection Agency as such. They're now forcing or trying to force Iran to agree to a protocol of inspection of those sites that now are suspect.
DOBBS: But they've been trying to do that for some time. We're now joined by others in that call.
But the question I ask, Bill, was doesn't this sound a lot like the North Korean position?
COHEN: Well, it does sound similar. It does present a real challenge for us and not only us, but the entire world. That's why I think that the E.U. now is coming to support the hopefully support the United States position to bring as much international pressure against Iran to either open up its facilities for greater inspection or to certainly put pressure on Russia, China and others for continuing to support any kind of commercial nuclear capability for Iran.
DOBBS: Tehran has protested the U.S. endorsement of those student protests in Iran. Russia has taken something of a middle road rather than stepping forward to apply pressure against the Iranians on the issue of nuclear weapons.
Where are we headed here?
Where should we be headed?
COHEN: I think we should let things unfold within Iran. The students have been gaining some momentum to be sure. And the Iranian clerics have become concerned. They look at two historical precedents. One in Tiananmen Square some 14 years ago this year where the Chinese officials cracked down on those student riots and such and suppressed the desire for more freedom. The other historical precedent occurred in Eastern Germany where you saw the wall come tumbling down and a change of certainly regime there. So they're looking at both of those very closely now to see where they go. I think what we do is we continue to promote our values but not engage in what has previously been described by some as a covert effort to, quote, "Destabilize the Iranian regime." I think that would be a mistake.
DOBBS: Bill thank you very much. Bill Cohen tonight from Washington.
Coming up next here, the challenge of the economy. Treasury Secretary John Snow will share his views on tax cuts job growth, and best way to drive this economy.
And, the dark underbelly of the economy, pot, porn and illegal immigration. Eric Schlosser looks inside the black market in his new book, "Reefer Madness," and he joins us now to talk about a nation showing some signs of psychosis and hypocrisy. He is our guest next. Stay with us.
(COMMERCIAL BREAK)
DOBBS: It's been four months since Treasury Secretary John Snow took over the department, joining the Bush administration. In that time Snow has been the president's leading advocate for tax cuts and job growth, selling the plan to taxpayers and, of course, Congress.
I talked with the treasury secretary earlier and asked him if the tax cuts will indeed generate more than a million jobs over the next 12 to 18 months.
(BEGIN VIDEOTAPE)
JOHN SNOW, TREASURY SECRETARY: I'm confident it will. People will have more money in their pockets. Small businesses become more profitable as they pay less taxes. They get the benefit of the expensing.
The dividend - the reduction in the dividend tax, the reduction of the capital gains tax, all these together I think are going to encourage more spending and more investment. And as that happens, our outlook is for a million-plus additional jobs.
DOBBS: You mentioned the stock market. We have seen some remarkable gains since the March lows. Is this market moving too fast? Is this a short, brief period of "irrational exuberance," to follow the Fed chairman's famous phrase, in a very short period of time?
SNOW: Well, the pickup is encouraging. One thing I think treasury secretaries should not do, though, is predict markets. The...
DOBBS: (UNINTELLIGIBLE) know what else, I do (ph).
(LAUGHTER)
SNOW: The fundamentals, though, look to me to be pretty good. I think corporate America has leaned out its cost structure and, as demand comes back, and I think it will, there's a lot of upside potential in the profitability. That ought to get capitalized in the stock market, but I don't want to predict the stock market, although I will say I'm very encouraged.
DOBBS: CEOs are not very optimistic. They're not hiring. Is there any sign that you see that the business leadership in this country is finally coming out and taking charge, showing the leadership that they're supposedly being paid to exercise?
SNOW: Well, Lou, you put your finger on a really good, good point. We've got the consumers performing well. We've got the housing market performing well. We've got low interest rates. We've got cost coming out of our American industry. What we don't have yet is capital spending and we haven't had it for three years.
I think capital spending comes back when business people see their inventories go down even lower and when they see their sales numbers rise. Hopefully with this tax bill they're going to see that soon and then they'll get back to being more aggressive.
DOBBS: This tax bill comes, as you know, Mr. Secretary, with a huge price tag in terms of the deficit, projections from $400 billion now to estimates of some almost a half trillion dollars in the next fiscal year. Is that a healthy thing for this economy or is it a drag on this economy offsetting the benefits of that tax cut?
SNOW: Well, this is a deficit we can afford. I think the real deficit - the deficit we can't afford is the deficit in growth and the deficits in jobs. This is a 4 percent deficit. We've had much higher deficits in the past. And this is a deficit that's occurring at a time when the economy is underemployed. You really worry about deficits...
DOBBS: Right.
SNOW: ...when you've got full employment, strong economic growth, because then you've got the risk of inflation and high interest rates. Today we have the lowest inflation and the lower interest rates in many, many years.
DOBBS: Are you hopeful about what is happening in France and in Germany and even Japan?
SNOW: We need another growth engine in this world economy. I think we're going to get our growth rates back up to where they should be, as I mentioned earlier. But I'm worried about the growth rates in the rest of the G-7, the big industrialized economies of the world. There are some hopeful notes, though.
In Germany, there is legislation pending to free up labor markets. In France, there is legislation pending to deal with the serious issue of pensions and the huge burden pensions are on the economy. And, in Japan, steps are being taken on the banking crisis and deregulation. But it's really important that those steps come to fruition because the world economy can't depend only on one engine, the United States.
DOBBS: And, in the issue of corporate corruption, if I may go back to that, you said recently that you believe there should be far more oversight of Freddie Mac, Fannie Mae, the largest mortgage entities in the country that control about half of the nation's mortgages. Are we going to see that?
SNOW: Well, I think there needs to be clearly more disclosure, more transparency. I'd like to see the '34 act applied to Freddie Mac and to the home loan banks. Of course, Fannie Mae is under that now and we applaud them for going under it. But, yes, I think more oversight, more disclosure, more transparency is called for. DOBBS: I know you've had a number of members of your department looking into the financial impact on the markets as a result of whatever is transpiring at Freddie Mac. We don't know yet fully what has transpired there. What is your best judgment now?
SNOW: Well, I think it's actually too early to say. We're just in the fact-finding phase. It doesn't look like what's transpired is a threat to the soundness of the financial system. On the other hand, I do think we need to get at the heart of what happened here and clear the air on it.
DOBBS: One final question, with these tax cuts, with all the stimulus in this economy, with burgeoning deficits, stubborn jobless recovery to this point, are we going to be better off next year than we were four years ago?
SNOW: Well, I'll tell you this. I think we're a lot better off because George Bush is in the White House than we would have been if he weren't. And, yes, I think we will be better off.
(END VIDEOTAPE)
DOBBS: Treasury Secretary John Snow.
Checking now the U.S. trade deficit, tonight it stands at more than $233 billion.
And a reminder to vote in tonight's poll. The question: "What do you look for first when buying a car? Safety? Style? Fuel- efficiency? Or Price?"
Cast your vote at cnn.com/lou. We'll have preliminary results for you later in the show.
A dramatic shareholder showdown in Houston tonight. Stockholders in El Paso staged a revolt against El Paso's board of governors. The preliminary vote tally suggests the attempted coup failed, and the board was re-elected.
But as Casey Wian now reports, the impact of this revolt will be lasting.
(BEGIN VIDEOTAPE)
CASEY WIAN, CNNfn CORRESPONDENT (voice-over): You could call natural gas giant El Paso "Enron Lite." The similarities include accounting tricks to hide massive debt, off-balance sheet partnerships, failed telecommunications businesses, even the suicide of a company official. And of course, lawsuits from shareholders furious that their stock at one point lost more than 90 percent of its value.
Unlike Enron, El Paso has avoid the bankruptcy and criminal charges. Instead, management has narrowly survived a four-month battle with a group of dissident shareholders, known here as "the blue slate." JACK PESTER, EL PASO SHAREHOLDER: It's pretty simple. El Paso was terribly mismanaged and really had no concept or idea of what they were doing and they ran a lot of good assets into the ground.
WIAN: The dissident group is led by former El Paso Director Selim Zilkha and Oscar Wyatt, another longtime energy industry executive. They say they want to return El Paso to the basics of the energy business.
SELIM ZILKHA, DISSIDENT SHAREHOLDER: I will be watching. That's my next step.
WIAN: Current management argues it's in the process of riding the El Paso ship, and points to the fact that its stock has nearly tripled from its February low. Many shareholders remained undecided going into the meeting.
JOE CROCHET, EL PASO SHAREHOLDER: I don't know right now. I'm (UNINTELLIGIBLE) make up my mind.
WIAN: The vote won't be official for weeks. The apparently unsuccessful proxy fight could have longer lasting implications.
KARL MILLER, ENERGY INDUSTRY CONSULTANT: This company represents everything that needs to be changed in corporate America today. And it really represents also an opportunity for the institutional investors, who represent retail investors by virtue of the funds that they manage -- it offers them an opportunity to step up and make the right decision in the corporate governance arena and really demonstrate to the rest of corporate America that you will vote in favor of change.
WIAN: Both sides agree the El Paso proxy fight has already forced needed change.
(END VIDEOTAPE)
WIAN: Among those changes, four new independent board members, a search for a new CEO, and a renewed focus on El Paso's core business, the largest network of natural gas pipelines in North America -- Lou.
DOBBS: Casey, it looks like the upturn in the company stock came just in time. That played a big part in the mood of shareholders there today.
WIAN: Absolutely. To use a cliche, it was a cliff hanger. People on both sides had no idea which way the vote was going to go going into the meeting. And in fact, the leader of the dissident group still was not conceding defeat, even after the company's announcement this afternoon -- Lou.
DOBBS: Terrific. Thank you very much, Casey. Casey Wian reporting live from Houston, Texas.
Turning to our "Quote of the Day," Deloitte Consulting today introduced something called Bull Fighters software. It searches document for business jargon and unnecessarily complex language. Bull, only one half of the rather popular word used to describe that sort of thing in language. When describing the reason for creating this program, one Deloitte Consulting partner put it this way: "We have had it with repurposeable, value-added, knowledge capital and robust, leverageable mindshare. Enough already!" That from Brian Fugure, partner at Deloitte Consulting.
Still's ahead, inside the black market: drugs, illegal immigrants and pornography. The underground of this nation's economy is booming. Eric Schlosser is the author of the new book "Reefer Madness," and he will join us.
Later, many of you e-mailed us about your outrage about those cell phone fees. We'll share some of your thoughts about Peter Viles and more coming up.
Stay with us.
(COMMERCIAL BREAK)
DOBBS: The U.S. economy has been improving steadily yet slowly. But this country's underground business has been booming. Author Eric Schlosser says the black market and marijuana, pornography and illegal migrant workers generates about $1 trillion a year. It's about one- tenth of our entire economy. It continues to grow. Eric Schlosser makes his case in his new book entitled "Reefer Madness." He joins us now. Good to have you here.
ERIC SCHLOSSER, AUTHOR, "REEFER MADNESS": Thanks for having me.
DOBBS: You talked about a country that is having problems when we talk about the sentencing for marijuana users, we talk about border security, and yet literally millions of illegal immigrants are crossing our borders over the course of the past several years. How do you reconcile this disconnect?
SCHLOSSER: There is a disconnect between what people want and what the laws are allowing them to have. It was interesting looking at the corporate executives who have been charged in these scandals and how many have actually gone to prison. That graphic you had earlier -- in my book, I write about people for relatively minor marijuana crimes going to prison for life. And in terms of the border, we've had a huge increase in illegal immigration, in black market labor. And that's again, these companies have been able to employ these workers and profit from doing so in violation of not only of immigration law, but of overtime and minimum wage laws.
DOBBS: As a young reporter in southern Arizona, working near the obviously the Mexican border -- the same issues you describe were relevant then. That's three decades ago. When is it going to end? You know, the war against terror, we're not bolstering security and stopping illegal immigration, nor are we dealing with growers who are providing the minimal payment, compensation for the work of these illegal immigrants.
SCHLOSSER: What's changed is that when you were a reporter in Arizona, this problem was mainly confined to California and the Southwest. It's now nationwide. And you find that sort of illegal immigration now in New York City and in the Northeast. So it's got to change when the companies who are recruiting these workers are forced to change their working conditions. And these are very big companies that are profiting from it. It's not just little mom-and-pop operations.
DOBBS: And we might say that you don't approach this from the typical, if you will, I would call it bleeding heart perspective. You approach it with a very cold eye and reasonable eye to the economics involved in what we're really as consumers in this country doing to our nation and to these people for not being willing to pay $50 more a year each to support them.
SCHLOSSER: To double the wages of the poorest workers in America would cost $30 to $50 a year. And thank you for saying that. I mean, as an investigative reporter, I'm trying to lay out the facts. People can come to their own conclusions about what to do about it.
DOBBS: Some of the other facts that you deal with on pornography, it's a very difficult, awkward subject for many people in this country to deal with. But the companies that profit from pornography -- nothing illegal itself in pornography, it's a question of values and the role of pornography. Some of the largest companies, media companies, including this one, AOL Time Warner, the parent of this network, it's remarkable, this transformation over a period of time.
SCHLOSSER: And if you were to go back 30 years, "Deep Throat" was one of the most profitable films ever made. That money went mainly to organized crime figures. Today the money in pornography is being earned by big, big corporations. About 500 million a year in cable and satellite pay-per-view, about 200 million a year to the big hotel chains. So this is an example of the black market becoming the mainstream. Becoming a corporate commodity.
DOBBS: The underground economy, the way you explore it and put it into context. Eric, fascinating reading and provocative reading. And it's about time we had some stimulus to think about these issues.
SCHLOSSER: Thank you.
DOBBS: Thank you very much, Eric Schlosser. The book is called "Reefer Madness."
Still ahead here, we'll share some of your thoughts about protecting our ports and more. And we'll have the preliminary results of tonight's poll. Stay with us.
(COMMERCIAL BREAK)
DOBBS: Tonight's poll results. The question, what do you look for first when buying a car? Twenty-three percent of you say safety, 23 percent say style, 19 percent fuel efficiency, 35 percent said price. Taking a look at some of your thoughts. R. Terry of Chicago wrote in about port security saying -- "7 million containers enter our ports each year. That comes to about 19,000 containers per day. We can put hundreds of weapons of mass destruction inspectors on the ground in Iraq, yet when it comes to inspecting 19,000 containers, all you hear is that it is too much of a huge task."
John Whitten of Norfolk, Virginia, wrote about the number of government taxes added to cell phone bill, as Peter Viles reported here last night: "Here in Norfolk," he points out, "the city tacks on a 25 percent "use" tax to the total bottom line of the bill. On top of all other taxes, all other charges, all other services, anything that appears on the phone bill, the city of Norfolk, Virginia screws you for another 25 percent."
Lilith Marie Hass of Long Beach, California wrote: "I love your show. The corporate crime watch and national debt are serious topics no one else seems to have the courage to cover, and you do it so eloquently. In regard to the recall of Governor Gray Davis in California, why do you people forget that it was Texas energy corporations that bankrupted California in the first place?"
And finally, Madeleine Brown of East North port, New York wrote: "I would like to congratulate you and your staff on the beautiful first program of LOU DOBBS TONIGHT. The new format extremely interesting, very pleasing to the eyes. Thank you very much for continuing to be the best news show in town for the great new look." And we thank you very much.
And we love hearing from you. Always, send us your thoughts at loudobbs@cnn.com. And that's our show for tonight. Thanks for being with us. Tomorrow, we continue our series of special reports on the impact of emerging diseases in this country. Former ambassador to the United Nations, James Kirkpatrick, will also be here. Please join us. For all of us here, good night from New York.
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ANNOUNCER: This is LOU DOBBS TONIGHT for Tuesday, June 17. Here now Lou Dobbs.
LOU DOBBS, CNN ANCHOR: Good evening everyone.
Better days ahead. Today the White House said this economy will grow stronger in the second half of the year. President Bush said the tax cuts just approved by Congress will drive the economy.
White House Correspondent Suzanne Malveaux joins us live now -- Suzanne.
SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT: Well, Lou, very much President Bush looking and sounding like candidate Bush.
Earlier today at a community college in Virginia, the big focus, the big push of course is the economy. White House aides say that despite his post-war popularity they know that this is the one issue that really resonates with voters.
The latest poll showing some 30 percent say the economy is the most important problem, 12 percent say it's unemployment, but the White House, of course, realizing they not only have to strengthen the economy but also make sure that voters sort of see that it's Bush's policy that is responsible for these improvements.
The Bush administration aides today stressing really the economic indicators painting a rosy picture, saying that the inflation rate is flat, they expect better growth in the second part of the year and, of course, Bush aides want that the president gets the credit for the recovery.
(BEGIN VIDEO CLIP)
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: The Jobs in Growth bill will pass back money to the people who sent the money to Washington in the first place and it will help with a -- it helps because when people have more money in their pocket they're going to demand an additional good or a service and we need an increased demand in a sluggish economy and when somebody demands an additional good or a service in our economy, somebody is going to produce that good or a service, and when that happens someone is likely to find work. The Jobs in Growth bill came at the right time.
(END VIDEO CLIP) MALVEAUX: And, Lou, also the right time the administration feels for fund-raising. President Bush tonight kicking off a huge fund- raising blitz, it's a $2,000 a plate dinner this evening in Washington. It's expected he is going to break all fund-raising records, including his own, perhaps as much as $250 million in the next couple of months -- Lou.
DOBBS: Money the order of the day with the White House. Suzanne, thank you very much, Suzanne Malveaux.
Well, earlier I talked with Treasury Secretary John Snow who said this economy is already in recovery and growth will pick up soon.
(BEGIN VIDEO CLIP)
JOHN SNOW, TREASURY SECRETARY: I think we're seeing already some positive signs, the stock market, some better news coming out of the manufacturing sector, and we're looking at the growth rates for the second half that are going to be a nice pickup over the first half.
(END VIDEO CLIP)
DOBBS: And we'll have the interview with Secretary Snow at the money summit later in the show.
Turning now to the Middle East, the White House today stepped up its efforts to sell the road map for Middle East peace to Israeli and Palestinian leaders. The State Department said Secretary of State Colin Powell will arrive in Jerusalem Friday. The secretary is expected to meet with Israeli Prime Minister Ariel Sharon and Palestinian leaders. Secretary Powell will then travel to Jordan.
The Bush administration's new Middle East envoy is already there. Assistant Secretary of State John Wolf and Palestinian Prime Minister Mahmoud Abbas met for the first time in Gaza City today. Abbas also met with Palestinian militant groups. He urged them to declare a cease-fire with Israel. Hours later, a seven-year-old Israeli girl was killed in a shooting in the West Bank.
Matthew Chance joins us live now from Gaza with the very latest -- Matthew.
MATTHEW CHANCE, CNN CORRESPONDENT: Lou, thank you.
More tragedy and more bloodshed in the Israeli-Palestinian conflict that as talks with the main Palestinian groups here and the Palestinian Prime Minister Mahmoud Abbas to try and declare a cease- fire with the Israelis end here in Gaza without any breakthrough.
We'll start, though, with the latest violence. And Israeli ambulance workers tell us, as you mentioned, a seven-year-old Israeli girl has been killed near the West Bank town of Kalkilya when a car in which she was traveling was shot at by unidentified gunmen. Officials also say that her five-year-old sister has also been critically injured, her father also lightly injured in that attack. We don't have much more information at this stage but, obviously, we'll bring you more as soon as it comes through to us, but this latest violence of course only underlines just how urgent is the need here for a cease-fire in this conflict.
The Palestinian prime minister, as I mentioned, Mahmoud Abbas, has been meeting with the main Palestinian militant groups here in Gaza urging them to stop their campaign of violence against Israelis.
But what they're saying is that without concrete guarantees from the Israelis that Israel will suspend its policy of assassinating leaders of the militant groups, Hamas and Islamic Jihad saying until that happens they will keep up what they call their resistance to Israeli occupation. What that means is that the violence, the bloodshed will carry on.
DOBBS: Matthew, thank you very much, Matthew Chance reporting from Gaza.
In Iraq today, an Iraqi sniper shot and killed an American soldier in Baghdad. He was the 50th U.S. serviceman to die in Iraq since the first of May. The shooting came as Operation Desert Scorpion entered its third day.
The crackdown against anti-American paramilitary fighters and Iraqis loyal to Saddam Hussein has resulted in the arrests of more than 400 people. Soldiers on those raids also saw combat in the war and hoped to be home by now but the army says it doesn't have enough troops to replace them.
Our Senior Pentagon correspondent Jamie McIntyre joins us live with the story -- Jamie.
JAMIE MCINTYRE, CNN SR. PENTAGON CORRESPONDENT: Well, Lou, because of ballooning global commitments, the U.S. Army is fresh out of reinforcements. Most of the soldiers now in Iraq can expect a nine-month tour of duty even those who have already served in Afghanistan. Soldiers of the 3rd Infantry Division who bore the brunt of the initial combat are needless to say disappointed.
(BEGIN VIDEO CLIP)
SGT. JEFFREY ELLIS, ALPHA COMPANY GUNNER: They expected us to come straight home. It's real hard on like my girlfriend.
CAPT. ANDY HILMES, COMPANY COMMANDER: I'm not going to lie. I'm not going to sugar coat anything. The guys were devastated. I personally was devastated, you know. We all have family back home waiting on us.
UNIDENTIFIED MALE: I was a little irritated, you know. It seems like there's plenty of other soldiers to do it. Why do we have to do it?
(END VIDEO CLIP) MCINTYRE: In 1991, when the Army sent the equivalent of eight divisions to Iraq it still had ten divisions left. Now, the Army has ten divisions total and only one, the 1st Cavalry Division in Fort Hood, Texas is complete and ready for deployment on short notice.
At his retirement last week, Army Chief of Staff General Eric Shinseki, who infuriated the Pentagon with his prewar prediction it would take several hundred thousand troops to secure Iraq, delivered something of a parting shot. "The Army" he charged "is two divisions short."
(BEGIN VIDEO CLIP)
GEN. ERIC SHINSEKI, U.S. ARMY CHIEF OF STAFF: Beware the 12 division strategy for a ten division Army. Our soldiers and families bear the risk and hardship of carrying a mission load that exceeds what force capabilities we can sustain.
(END VIDEO CLIP)
MCINTYRE: The Pentagon insists the problem isn't that the Army is too small but rather that too many U.S. military personnel, 320,000 by one estimate, are doing jobs that should be done by civilians -- Lou.
DOBBS: A remarkable piece of reasoning, Jamie. The fact remains that the forces were cut by half over the course of the time between this and the last war in Iraq. Is there any sign that Secretary Rumsfeld, the Pentagon, are going to seriously address the fact that U.S. forces are stretched too think around the world, not only in Iraq?
MCINTYRE: Well, you know it's interesting, Lou, because during the campaign candidate Bush and his campaign staff sharply criticized the Clinton administration for cutting the Army by two divisions from 12 to ten saying that was too deep, but once they got in office the administration wasn't interested in increasing the Army's manpower in fact, they talked about cuts.
That, of course, all changed on September 11 but the Pentagon continues to talk about trying to get, increase the manpower and the combat strength by shifting more of the administrative jobs to the private sector and not adding to what they call the end strength or the overall size of the U.S. military.
DOBBS: And, Jamie, the Pentagon today released more information about the ambush of the Army unit that Private Jessica Lynch was part of. Tell us about that.
MCINTYRE: Well, we're not learning a lot more but we have learned a little bit more about the raid that happened that day, the ambush that happened that day to the maintenance convoy that Jessica Lynch was a part of and one of the things that we discovered is that there was quite a bit of heroism that day as those Army troops fought off Iraqi attackers near Nasiriya. The vehicle that Jessica Lynch was traveling in was hit apparently by a rocket-propelled grenade and turned over. This is when they made essentially a wrong turn in the desert and ended up in hostile territory. Jessica Lynch, we're told, doesn't really remember anything from that point until she woke up in an Iraqi hospital.
But other members who survived that ordeal have told stories of other soldiers firing a lot of ammunition, fighting to the point where they had no more fight left to give before sustaining fairly heavy casualties -- Lou.
DOBBS: Jamie, thank you and Private Lynch has been in hospital now for more than two months. Jamie, thank you very much, Jamie McIntyre our Senior Pentagon Correspondent.
Still ahead here tonight, nuclear threat, Iran, nuclear weapons, and international pressure, former defense secretary and our regular contributor William Cohen will join us.
And, it's high noon in Houston, an angry showdown between energy giant El Paso and its shareholders some of whom are attempting a coup. Casey Wian is live in Houston. He'll have the story for us next. Stay with us.
(COMMERCIAL BREAK)
DOBBS: Our e-mail boxes seem to be filled with increasing amounts of spam. It is becoming one of the greatest aggravations of modern cyber life in this country. Microsoft has now launched an offensive against the relentless public enemy.
Katharine Barrett joins us now from Seattle, Washington with the very latest -- Katherine.
KATHARINE BARRETT, CNN CORRESPONDENT: That's right, Lou.
Microsoft is attempting to drag deceptive spammers out of the shadows of cyberspace and straight into court. They filed today 15 lawsuits against spammers accused of flooding the company's e-mail systems with as many as two billion pieces of deceptive and offensive mailing. Another two lawsuits were filed today in the United Kingdom on a similar matter.
That legal action is just part of an all-out offensive against spam on legal, technical, and political arenas. Microsoft joins other e-mail services, e-mail providers in taking spammers to court.
Earlier this year, AOL, parent of course of this company, sued over 100 spam senders. Earthlink has also pursued spammers on criminal charges. Still, many others are operating though beyond the reach of U.S. law coming out of countries like China, which makes them much harder to pursue.
One Microsoft software engineer I spoke with today just a short while ago called this nothing short of a war between the spammers and anti-spammers who are working as fast as they can on a technical level to block these e-mails. But the volume of spam soared 85 percent in the past year. E-mail system servers already filter out about 40 to 70 percent of what comes in as spam each day.
But joining Microsoft today at its press conference was Washington State's attorney general. She pointed out that some of what still gets through is far worse than merely inconvenient.
(BEGIN VIDEO CLIP)
CHRISTINE GREGOIRE, WASHINGTON STATE ATTY. GENERAL: Some 20 percent of spam is where we're getting pornography from. That's coming into the homes of families who don't want to see that sort of thing in their home for their children let alone for themselves. Ninety percent of the viruses are passed on by spam so it's not just a nuisance. It's a huge cost to business. It's a cost and an annoyance to consumers.
(END VIDEO CLIP)
BARRETT: And, in a letter to Congress earlier this spring, Microsoft founder Bill Gates called spam a threat to the viability of e-mail as a method of communications -- Lou.
DOBBS: Katharine, it's not our imagination when we think that our e-mail boxes are being filled with more and more spam.
BARRETT: No, to some extent it's a numbers game. The spammers know that even if they get a tiny fraction through they just have to send more, throw more at the system.
DOBBS: Katharine, thank you very much, Katharine Barrett from Seattle, Washington tonight.
BARRETT: My pleasure.
DOBBS: On Wall Street today, stocks rose for the fifth time in the past six sessions. Stocks closed just slightly higher, the Dow up four points, the NASDAQ rose two points, the S&P skyrocketed almost a point.
Susan Lisovicz is here now with the market for us tonight, Susan a little gain but a gain is a gain.
SUSAN LISOVICZ, CNN CORRESPONDENT: A little gain is a gain and after yesterday's huge gain it's kind of a surprise to some people who are watching the market.
Lou, investors buying for a second day on upbeat information on the state of the economy. It's not often that inflation is considered a friend but given the concerns about deflation the largest jump in the core consumer price index since last August was viewed by Wall Street as a positive.
Industrial production exceeded expectations of a flat reading, and Americans continue to rush into the housing market. Housing starts surged six percent in May. Pfizer, the most actively traded issue on the big board extended its gains another 4.5 percent on bullish earnings forecasts.
Electronics retailer Circuit City added more than 13 percent after narrowing its quarterly loss.
Microsoft which, Lou as you just mentioned, is stepping up its legal battle against spam closed up better than half a buck.
On the losing side, Coke shed two percent on word of an informal inquiry by the SEC into allegations of deceptive marketing and accounting practices raised in a suit filed against the company last month.
AT&T fell nearly five percent on the day after a downgrade to sell from Merrill Lynch which cited increased competition and dissatisfaction with its recovery in enterprise systems. AT&T the biggest drag on the Dow although the index still managed to eke out a gain.
Declining issues, however, edged out advancers at the NYSE, and volume which was below average yesterday, Lou, picked up today coming in at nearly 1.5 billion shares.
DOBBS: That's a pretty good pickup from 1.3 yesterday.
LISOVICZ: And, yes, all three major indices up better than 2.25 percent yesterday.
DOBBS: Terrific. Thanks very much Susan Lisovicz.
Former Rite-Aid Chief Executive Martin Grass today agreed to plead guilty to two counts of conspiracy. That deal calls for an eight year prison sentence. Grass will pay $3.5 million.
He was indicted last year along with three other Rite-Aid executives. His trial had been scheduled to begin next week. Grass is one of 73 executives in all of corporate America now to be charged with some form of criminal wrongdoing, 16 of those from Enron.
If the deal is accepted, Grass will become the second executive to be sent to jail. So far, ImClone's Sam Waksal is the only executive sentenced to jail throughout this corporate corruption scandal which began 561 days ago when Enron filed for bankruptcy.
Coming up next tonight, attention sport utility drivers, new crash tests rate the best and the worst in SUVs and there's more bad than good.
Emerging diseases, our series of special reports this week, tonight we focus on monkeypox. Kitty Pilgrim will report. That's coming up. Stay with us.
(COMMERCIAL BREAK)
DOBBS: The Insurance Institute today released the results of its first ever side impact crash test for sport utility vehicles. The test ranked 12 small SUVs following a 30-mile-an-hour impact to the driver's side.
The top two performers the Subaru Forester, side airbags, and the Ford Escape with side airbags, the Forester is the only one of the SUVs which earned a top rating in the side and frontal crash tests. Among the worst performers in the side impact test Mitsubishi's Outlander, Toyota's RAV4, and the For Escape without side airbags.
Kathleen Koch joins us now from Ruckersville, Virginia, with more on the story. Kathleen, these are concerning test results at the least I would think.
KATHLEEN KOCH, CNN CORRESPONDENT: They are and what the Insurance Institute was trying to do, Lou was to replicate the kind of crash we see on our roads every day, that's an SUV or a pickup broad- siding another vehicle.
They created a special barrier to use and here it is. You can see that it's much taller and much more contoured than the very low and relatively flat fronted barrier the federal government has been using in its tests for years.
Let's take a look at the crash test of a Subaru Forester, the one you said rated the top in this test. Now when the barrier crashes into it at 31 miles per hour, yes, it is a violent crash but still nonetheless the driver of this vehicle would likely have survived.
David Zuby is here from the Insurance Institute, David what made the difference?
DAVID ZUBY, INSUR. INST. FOR HIGHWAY SAFETY: Well, the big difference is that the Forester comes equipped with a standard side airbag that offers protection for both the chest and the head. So, when a moving barrier struck the side of the Forester, this airbag deployed from inside the seat, inflated with air and cushioned the dummy's head and chest from the intruding side structure.
KOCH: Saving the driver's life. Now, the same thing did not happen, though, in many of these tests where the vehicles failed. Let's take a look at the Mitsubishi Outlander now. That Outlander did not have an airbag for the dummy that was in the front seat and you can see a huge difference. David, tell us what happened in this case.
ZUBY: That's right. Obviously there's no side airbag here and, in addition, we've got a fair amount of more intrusion into this structure, so when the barrier came in and pushed against the door of the Mitsubishi Outlander, it went straight in and hit the dummy itself. The dummy's head hit the barrier.
We measured very high forces that would indicate a severe risk of a serious injury. We also measured significant crushing of the dummy's chest indicating that had that been a person they would have suffered serious chest injuries.
KOCH: They might have died. David, now obviously let's take a look at one vehicle that interestingly both was the best and the worst, the Ford Escape. If we can play that video you'll see a side- by-side comparison of the close shot of the head of the dummy where there was an airbag and then the Ford Escape where there was not. Tell us how much of a difference these airbags are really making, these side airbags.
ZUBY: Well, this test is a good example of how much difference the airbag by itself can make because you've got the exact same vehicle. The only difference is the airbag. The outcome for the rear seat passenger was exactly the same. The structure deformed exactly the same.
In the case of the test without the airbag, the driver would have suffered serious injuries whereas in the case with the airbag the driver is protected from those serious injuries and may well have walked away from that crash.
KOCH: David Zuby, thank you very much.
And, Lou, it's important to point out that Mitsubishi is among the manufacturers who say they believe that this is a very extreme test. It's not yet been accepted by any of the auto makers or by the federal government and they believe that their vehicles, as they say, comply with all federal safety standards -- back to you.
DOBBS: Kathleen, thank you very much, Kathleen Koch from Ruckersville, Virginia.
That brings us to tonight's poll. "What do you look for first when you buy a car, safety, style, fuel efficiency, or price?" Cast your vote at cnn.com/lou. We'll have preliminary results in the polling later in the show.
Now the final results of yesterday's poll. The question, "What do you think of the recent stock market rally?" Fifteen percent of you said too much too soon, 48 percent said downdraft ahead, 20 percent said just what we needed, 17 percent said even more to come.
Our nightly check on the national debt now, tonight it stands at almost $6,600,000,000,000. The debt has risen almost $16 billion from just last night.
When we continue here, monkeypox, in our series of special reports on emerging diseases, Kitty Pilgrim will examine the latest threat through the eyes of one of its youngest victims.
And, shareholders revolt in Houston; investors try a coup in El Paso and at El Paso. We'll have a live report for you. Stay with us.
(COMMERCIAL BREAK)
DOBBS: Millions of Americans suffer from depression and according to a new study more than half of them receive inadequate care.
Medical Correspondent Elizabeth Cohen joins us now with more on this new study -- Elizabeth.
ELIZABETH COHEN, CNN MEDICAL CORRESPONDENT: Lou, this is a major new study coming out of Harvard University and what they found is that one out of six Americans suffers from depression. This is a huge number, bigger than what other studies have found in the past and, that as you said most of them are not getting adequate treatment.
Let's take a look at the specific numbers. What they found is that four out of five patients received inadequate treatment and they looked at 9,000 patients so that's a big study.
First of all there were drug dosage problems. People were getting wrong dosages of the anti-depression drugs. Also, the patients were just sort of on their own discontinuing treatment, and also that patients were using unproven treatments. Rather than going to the doctor and getting a prescription, they were just sort of trying whatever they thought might work.
The bottom line of the study, according to the author who wrote it, he said look depression is a disease and people need to start treating it more like a disease. If you had cancer you wouldn't treat that on your own and people shouldn't try to treat depression on their own. They need to go see their doctor and the stigma needs to come off of depression -- Lou.
DOBBS: Elizabeth, that's a fascinating study. At the same time, it leaves a difficult question that's persisted for some time. How does one know whether one is just having a bad day, feeling a little let down, or clinically depressed?
COHEN: Right, there are very specific things that people can look for. There's a long list of symptoms and I'll read them in a second, and what you need to say is out of all these symptoms am I experiencing at least five of them every day for two weeks?
So, let's take a look at what the specific symptoms are. They are: decreased interest or pleasure in activities; appetite change with weight gain or weight loss; decreased or increased sleeping; fatigue or loss of energy; feeling worthless or guilty; being either agitated or slowed down; difficulty thinking or concentrated; and recurrent thoughts of death or suicide.
And, again, this isn't just sort of feeling one of these Monday and not feeling them Tuesday. That wouldn't be clinical depression. It would be feeling at least five of these things every day for two weeks or more -- Lou.
DOBBS: Elizabeth Cohen, thank you very much.
Health officials today confirmed that a Kansas woman has that state's first case of monkeypox. It's also the first case west of the Mississippi River. The woman was bitten by a prairie dog about two weeks ago while she was in Missouri. Fifteen other cases of monkeypox have been confirmed nationwide. Another 81 cases are now under investigation.
As part of our continuing series this week on emerging diseases, Kitty Pilgrim now looks at the spread of monkeypox.
(BEGIN VIDEOTAPE)
KITTY PILGRIM, CNN CORRESPONDENT: It started innocently enough. Three-year-old Cheyenne Kautzer got two prairie dogs from a 4-H Club swap meet in Wisconsin but one of the prairie dogs bit the child and she became the first person in this country to be confirmed with monkeypox.
TAMMY KAUTZER: Her eye was almost completely swollen. She had bumps on her body. Her glands were sticking out of her neck where you could actually see them. For the first three days I was scared. I didn't know whether she was going to make it.
PILGRIM: Both her mother and father also came down with the disease. The prairie dog died and the second prairie dog also became ill. The Marshfield Clinic in central Wisconsin was frantic to find what caused the sickness. They knew it came from the animal but realized it could also be spread person-to-person.
DR. KURT REED, MARSHFIELD CLINIC RESEARCH FOUNDATION: I really couldn't find anything and so we wondered are we dealing with a virus from North America that just hasn't been previously reporte or characterized.
At that point we had no knowledge about exposure to animals from western Africa.
PILGRIM: That is exactly what they had. Monkeypox is a western African disease, never before seen in the Western Hemisphere. Originally found in monkeys, it's related to smallpox and passes from animal to animal, or animal to human. The prairie dogs have been traced to an Illinois pet shop and are thought to have been infected by an African giant rat. So far the outbreak has been relatively contained to midwestern states. Wisconsin reported 34 cases, Illinois, 19, Indiana, 24, Missouri, one, and Ohio, two. Dr. Byron Dilenival (ph) is on exotic pet veterinarian. He says the mass wholesale of exotic animals is a problem.
UNIDENTIFIED MALE: It's when they go through those distributors or wholesalers they come in contact with more exotic species, like the Gambian rat, things from outside this country. Then act as a vector to then transmit it to humans or other animals.
PILGRIM: Some experts worry the country's borders are too open to animals with infectious diseases and consumers overlook the diseases exotic animal can carry.
JEFF BENDER, UNIVERSITY OF MINNESOTA: Thousands of animals pass our borders through our ports of quarantine. If there is a take-home message, it's that there are some pets that are more appropriate than others. There are some pets that -- or some animals that really don't make good pets.
(END VIDEOTAPE) PILGRIM: Cheyenne, by the way, has recovered and now has a new puppy. Monkeypox can be fatal. No one in this country has died of the disease but the sale of prairie dogs is now banned in the country. And it is a crime in some states to release them into the wild -- Lou.
DOBBS: Is it only the prairie dogs carrying this disease?
PILGRIM: So far, yes. But there is great concern that some animals may have been in close approximate to these prairie dogs in pet stores so it's on going investigation. They say keep your eyes open for all symptoms in new pets.
DOBBS: I think this is where we say, oh great.
OK, Kitty, thanks. Kitty Pilgrim.
Another person has died from the SARS virus in Canada. The 67- year-old man died yesterday in the Toronto area, the country's first death to the virus since June 7. Thirty-Four Canadians have now died from the SARS virus.
Earlier today the World Health Organization said the virus has been stopped dead in its tracks. That, their words, saying it is absolutely under control, at least for now. The agency, however, added that a single imported case or lapse in infection control could reignite an outbreak. That announcement came as the WHO lifted the travel advisory for Taiwan. An advisory still remains in place for Beijing. The disease has killed more than 800 people, sickened more than 8,000 world wide since being detected last fall in China.
We'll continue our special report on emerging diseases tomorrow here with a closer look at the SARS virus. In addition, we'll be joined by one of the leading experts in the field of viruses. Dr. Beatice Han (ph) will discuss how many emerging diseases such as SARS are jumping from animals to humans and the threat they pose to all of us. That's tomorrow, 6:00 p.m. Eastern here on CNN.
And it brings us to our "Thought of the Day" on illnesses.
"A disease known is half cured. That reassuring note from British author and scholar Thomas Fuller.
The United Nations nuclear watch dog group wants access to those Iranian nuclear facilities without prior notice. Iran says the price for that kind of access would be more advanced nuclear technology. Iran's nuclear program is at the center of discussion this week in Vienna.
And joining us now to further this discuss this debate is former defense Secretary William Cohen in our Washington, D.C. studios.
Bill, good to have you here.
WILLIAM COHEN, FMR. DEFENSE SECRETARY: Good evening, Lou.
This is starting to have some resonance to the North Korean position, is it not?
COHEN: I think we've known for sometime that Iran was on a course to develop a nuclear capability. It's one of the reasons why the administration had protested to Russian leader Putin and to the Chinese and others to prevent the flow of that technology moving into Iran. Most recently, you had the Atomic Energy Inspector or official, I should say, ElBaradei, who indicated during a tour that Iran failed to disclose that they had imported certain nuclear materials and had reprocessed them, calling now for a much closer intrusive inspection on certain facilities. So I think this is building now. Certainly the E.U. is concerned, as well as the IAEA, which is the Atomic Energy Inspection Agency as such. They're now forcing or trying to force Iran to agree to a protocol of inspection of those sites that now are suspect.
DOBBS: But they've been trying to do that for some time. We're now joined by others in that call.
But the question I ask, Bill, was doesn't this sound a lot like the North Korean position?
COHEN: Well, it does sound similar. It does present a real challenge for us and not only us, but the entire world. That's why I think that the E.U. now is coming to support the hopefully support the United States position to bring as much international pressure against Iran to either open up its facilities for greater inspection or to certainly put pressure on Russia, China and others for continuing to support any kind of commercial nuclear capability for Iran.
DOBBS: Tehran has protested the U.S. endorsement of those student protests in Iran. Russia has taken something of a middle road rather than stepping forward to apply pressure against the Iranians on the issue of nuclear weapons.
Where are we headed here?
Where should we be headed?
COHEN: I think we should let things unfold within Iran. The students have been gaining some momentum to be sure. And the Iranian clerics have become concerned. They look at two historical precedents. One in Tiananmen Square some 14 years ago this year where the Chinese officials cracked down on those student riots and such and suppressed the desire for more freedom. The other historical precedent occurred in Eastern Germany where you saw the wall come tumbling down and a change of certainly regime there. So they're looking at both of those very closely now to see where they go. I think what we do is we continue to promote our values but not engage in what has previously been described by some as a covert effort to, quote, "Destabilize the Iranian regime." I think that would be a mistake.
DOBBS: Bill thank you very much. Bill Cohen tonight from Washington.
Coming up next here, the challenge of the economy. Treasury Secretary John Snow will share his views on tax cuts job growth, and best way to drive this economy.
And, the dark underbelly of the economy, pot, porn and illegal immigration. Eric Schlosser looks inside the black market in his new book, "Reefer Madness," and he joins us now to talk about a nation showing some signs of psychosis and hypocrisy. He is our guest next. Stay with us.
(COMMERCIAL BREAK)
DOBBS: It's been four months since Treasury Secretary John Snow took over the department, joining the Bush administration. In that time Snow has been the president's leading advocate for tax cuts and job growth, selling the plan to taxpayers and, of course, Congress.
I talked with the treasury secretary earlier and asked him if the tax cuts will indeed generate more than a million jobs over the next 12 to 18 months.
(BEGIN VIDEOTAPE)
JOHN SNOW, TREASURY SECRETARY: I'm confident it will. People will have more money in their pockets. Small businesses become more profitable as they pay less taxes. They get the benefit of the expensing.
The dividend - the reduction in the dividend tax, the reduction of the capital gains tax, all these together I think are going to encourage more spending and more investment. And as that happens, our outlook is for a million-plus additional jobs.
DOBBS: You mentioned the stock market. We have seen some remarkable gains since the March lows. Is this market moving too fast? Is this a short, brief period of "irrational exuberance," to follow the Fed chairman's famous phrase, in a very short period of time?
SNOW: Well, the pickup is encouraging. One thing I think treasury secretaries should not do, though, is predict markets. The...
DOBBS: (UNINTELLIGIBLE) know what else, I do (ph).
(LAUGHTER)
SNOW: The fundamentals, though, look to me to be pretty good. I think corporate America has leaned out its cost structure and, as demand comes back, and I think it will, there's a lot of upside potential in the profitability. That ought to get capitalized in the stock market, but I don't want to predict the stock market, although I will say I'm very encouraged.
DOBBS: CEOs are not very optimistic. They're not hiring. Is there any sign that you see that the business leadership in this country is finally coming out and taking charge, showing the leadership that they're supposedly being paid to exercise?
SNOW: Well, Lou, you put your finger on a really good, good point. We've got the consumers performing well. We've got the housing market performing well. We've got low interest rates. We've got cost coming out of our American industry. What we don't have yet is capital spending and we haven't had it for three years.
I think capital spending comes back when business people see their inventories go down even lower and when they see their sales numbers rise. Hopefully with this tax bill they're going to see that soon and then they'll get back to being more aggressive.
DOBBS: This tax bill comes, as you know, Mr. Secretary, with a huge price tag in terms of the deficit, projections from $400 billion now to estimates of some almost a half trillion dollars in the next fiscal year. Is that a healthy thing for this economy or is it a drag on this economy offsetting the benefits of that tax cut?
SNOW: Well, this is a deficit we can afford. I think the real deficit - the deficit we can't afford is the deficit in growth and the deficits in jobs. This is a 4 percent deficit. We've had much higher deficits in the past. And this is a deficit that's occurring at a time when the economy is underemployed. You really worry about deficits...
DOBBS: Right.
SNOW: ...when you've got full employment, strong economic growth, because then you've got the risk of inflation and high interest rates. Today we have the lowest inflation and the lower interest rates in many, many years.
DOBBS: Are you hopeful about what is happening in France and in Germany and even Japan?
SNOW: We need another growth engine in this world economy. I think we're going to get our growth rates back up to where they should be, as I mentioned earlier. But I'm worried about the growth rates in the rest of the G-7, the big industrialized economies of the world. There are some hopeful notes, though.
In Germany, there is legislation pending to free up labor markets. In France, there is legislation pending to deal with the serious issue of pensions and the huge burden pensions are on the economy. And, in Japan, steps are being taken on the banking crisis and deregulation. But it's really important that those steps come to fruition because the world economy can't depend only on one engine, the United States.
DOBBS: And, in the issue of corporate corruption, if I may go back to that, you said recently that you believe there should be far more oversight of Freddie Mac, Fannie Mae, the largest mortgage entities in the country that control about half of the nation's mortgages. Are we going to see that?
SNOW: Well, I think there needs to be clearly more disclosure, more transparency. I'd like to see the '34 act applied to Freddie Mac and to the home loan banks. Of course, Fannie Mae is under that now and we applaud them for going under it. But, yes, I think more oversight, more disclosure, more transparency is called for. DOBBS: I know you've had a number of members of your department looking into the financial impact on the markets as a result of whatever is transpiring at Freddie Mac. We don't know yet fully what has transpired there. What is your best judgment now?
SNOW: Well, I think it's actually too early to say. We're just in the fact-finding phase. It doesn't look like what's transpired is a threat to the soundness of the financial system. On the other hand, I do think we need to get at the heart of what happened here and clear the air on it.
DOBBS: One final question, with these tax cuts, with all the stimulus in this economy, with burgeoning deficits, stubborn jobless recovery to this point, are we going to be better off next year than we were four years ago?
SNOW: Well, I'll tell you this. I think we're a lot better off because George Bush is in the White House than we would have been if he weren't. And, yes, I think we will be better off.
(END VIDEOTAPE)
DOBBS: Treasury Secretary John Snow.
Checking now the U.S. trade deficit, tonight it stands at more than $233 billion.
And a reminder to vote in tonight's poll. The question: "What do you look for first when buying a car? Safety? Style? Fuel- efficiency? Or Price?"
Cast your vote at cnn.com/lou. We'll have preliminary results for you later in the show.
A dramatic shareholder showdown in Houston tonight. Stockholders in El Paso staged a revolt against El Paso's board of governors. The preliminary vote tally suggests the attempted coup failed, and the board was re-elected.
But as Casey Wian now reports, the impact of this revolt will be lasting.
(BEGIN VIDEOTAPE)
CASEY WIAN, CNNfn CORRESPONDENT (voice-over): You could call natural gas giant El Paso "Enron Lite." The similarities include accounting tricks to hide massive debt, off-balance sheet partnerships, failed telecommunications businesses, even the suicide of a company official. And of course, lawsuits from shareholders furious that their stock at one point lost more than 90 percent of its value.
Unlike Enron, El Paso has avoid the bankruptcy and criminal charges. Instead, management has narrowly survived a four-month battle with a group of dissident shareholders, known here as "the blue slate." JACK PESTER, EL PASO SHAREHOLDER: It's pretty simple. El Paso was terribly mismanaged and really had no concept or idea of what they were doing and they ran a lot of good assets into the ground.
WIAN: The dissident group is led by former El Paso Director Selim Zilkha and Oscar Wyatt, another longtime energy industry executive. They say they want to return El Paso to the basics of the energy business.
SELIM ZILKHA, DISSIDENT SHAREHOLDER: I will be watching. That's my next step.
WIAN: Current management argues it's in the process of riding the El Paso ship, and points to the fact that its stock has nearly tripled from its February low. Many shareholders remained undecided going into the meeting.
JOE CROCHET, EL PASO SHAREHOLDER: I don't know right now. I'm (UNINTELLIGIBLE) make up my mind.
WIAN: The vote won't be official for weeks. The apparently unsuccessful proxy fight could have longer lasting implications.
KARL MILLER, ENERGY INDUSTRY CONSULTANT: This company represents everything that needs to be changed in corporate America today. And it really represents also an opportunity for the institutional investors, who represent retail investors by virtue of the funds that they manage -- it offers them an opportunity to step up and make the right decision in the corporate governance arena and really demonstrate to the rest of corporate America that you will vote in favor of change.
WIAN: Both sides agree the El Paso proxy fight has already forced needed change.
(END VIDEOTAPE)
WIAN: Among those changes, four new independent board members, a search for a new CEO, and a renewed focus on El Paso's core business, the largest network of natural gas pipelines in North America -- Lou.
DOBBS: Casey, it looks like the upturn in the company stock came just in time. That played a big part in the mood of shareholders there today.
WIAN: Absolutely. To use a cliche, it was a cliff hanger. People on both sides had no idea which way the vote was going to go going into the meeting. And in fact, the leader of the dissident group still was not conceding defeat, even after the company's announcement this afternoon -- Lou.
DOBBS: Terrific. Thank you very much, Casey. Casey Wian reporting live from Houston, Texas.
Turning to our "Quote of the Day," Deloitte Consulting today introduced something called Bull Fighters software. It searches document for business jargon and unnecessarily complex language. Bull, only one half of the rather popular word used to describe that sort of thing in language. When describing the reason for creating this program, one Deloitte Consulting partner put it this way: "We have had it with repurposeable, value-added, knowledge capital and robust, leverageable mindshare. Enough already!" That from Brian Fugure, partner at Deloitte Consulting.
Still's ahead, inside the black market: drugs, illegal immigrants and pornography. The underground of this nation's economy is booming. Eric Schlosser is the author of the new book "Reefer Madness," and he will join us.
Later, many of you e-mailed us about your outrage about those cell phone fees. We'll share some of your thoughts about Peter Viles and more coming up.
Stay with us.
(COMMERCIAL BREAK)
DOBBS: The U.S. economy has been improving steadily yet slowly. But this country's underground business has been booming. Author Eric Schlosser says the black market and marijuana, pornography and illegal migrant workers generates about $1 trillion a year. It's about one- tenth of our entire economy. It continues to grow. Eric Schlosser makes his case in his new book entitled "Reefer Madness." He joins us now. Good to have you here.
ERIC SCHLOSSER, AUTHOR, "REEFER MADNESS": Thanks for having me.
DOBBS: You talked about a country that is having problems when we talk about the sentencing for marijuana users, we talk about border security, and yet literally millions of illegal immigrants are crossing our borders over the course of the past several years. How do you reconcile this disconnect?
SCHLOSSER: There is a disconnect between what people want and what the laws are allowing them to have. It was interesting looking at the corporate executives who have been charged in these scandals and how many have actually gone to prison. That graphic you had earlier -- in my book, I write about people for relatively minor marijuana crimes going to prison for life. And in terms of the border, we've had a huge increase in illegal immigration, in black market labor. And that's again, these companies have been able to employ these workers and profit from doing so in violation of not only of immigration law, but of overtime and minimum wage laws.
DOBBS: As a young reporter in southern Arizona, working near the obviously the Mexican border -- the same issues you describe were relevant then. That's three decades ago. When is it going to end? You know, the war against terror, we're not bolstering security and stopping illegal immigration, nor are we dealing with growers who are providing the minimal payment, compensation for the work of these illegal immigrants.
SCHLOSSER: What's changed is that when you were a reporter in Arizona, this problem was mainly confined to California and the Southwest. It's now nationwide. And you find that sort of illegal immigration now in New York City and in the Northeast. So it's got to change when the companies who are recruiting these workers are forced to change their working conditions. And these are very big companies that are profiting from it. It's not just little mom-and-pop operations.
DOBBS: And we might say that you don't approach this from the typical, if you will, I would call it bleeding heart perspective. You approach it with a very cold eye and reasonable eye to the economics involved in what we're really as consumers in this country doing to our nation and to these people for not being willing to pay $50 more a year each to support them.
SCHLOSSER: To double the wages of the poorest workers in America would cost $30 to $50 a year. And thank you for saying that. I mean, as an investigative reporter, I'm trying to lay out the facts. People can come to their own conclusions about what to do about it.
DOBBS: Some of the other facts that you deal with on pornography, it's a very difficult, awkward subject for many people in this country to deal with. But the companies that profit from pornography -- nothing illegal itself in pornography, it's a question of values and the role of pornography. Some of the largest companies, media companies, including this one, AOL Time Warner, the parent of this network, it's remarkable, this transformation over a period of time.
SCHLOSSER: And if you were to go back 30 years, "Deep Throat" was one of the most profitable films ever made. That money went mainly to organized crime figures. Today the money in pornography is being earned by big, big corporations. About 500 million a year in cable and satellite pay-per-view, about 200 million a year to the big hotel chains. So this is an example of the black market becoming the mainstream. Becoming a corporate commodity.
DOBBS: The underground economy, the way you explore it and put it into context. Eric, fascinating reading and provocative reading. And it's about time we had some stimulus to think about these issues.
SCHLOSSER: Thank you.
DOBBS: Thank you very much, Eric Schlosser. The book is called "Reefer Madness."
Still ahead here, we'll share some of your thoughts about protecting our ports and more. And we'll have the preliminary results of tonight's poll. Stay with us.
(COMMERCIAL BREAK)
DOBBS: Tonight's poll results. The question, what do you look for first when buying a car? Twenty-three percent of you say safety, 23 percent say style, 19 percent fuel efficiency, 35 percent said price. Taking a look at some of your thoughts. R. Terry of Chicago wrote in about port security saying -- "7 million containers enter our ports each year. That comes to about 19,000 containers per day. We can put hundreds of weapons of mass destruction inspectors on the ground in Iraq, yet when it comes to inspecting 19,000 containers, all you hear is that it is too much of a huge task."
John Whitten of Norfolk, Virginia, wrote about the number of government taxes added to cell phone bill, as Peter Viles reported here last night: "Here in Norfolk," he points out, "the city tacks on a 25 percent "use" tax to the total bottom line of the bill. On top of all other taxes, all other charges, all other services, anything that appears on the phone bill, the city of Norfolk, Virginia screws you for another 25 percent."
Lilith Marie Hass of Long Beach, California wrote: "I love your show. The corporate crime watch and national debt are serious topics no one else seems to have the courage to cover, and you do it so eloquently. In regard to the recall of Governor Gray Davis in California, why do you people forget that it was Texas energy corporations that bankrupted California in the first place?"
And finally, Madeleine Brown of East North port, New York wrote: "I would like to congratulate you and your staff on the beautiful first program of LOU DOBBS TONIGHT. The new format extremely interesting, very pleasing to the eyes. Thank you very much for continuing to be the best news show in town for the great new look." And we thank you very much.
And we love hearing from you. Always, send us your thoughts at loudobbs@cnn.com. And that's our show for tonight. Thanks for being with us. Tomorrow, we continue our series of special reports on the impact of emerging diseases in this country. Former ambassador to the United Nations, James Kirkpatrick, will also be here. Please join us. For all of us here, good night from New York.
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