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Lou Dobbs Tonight
President Bush Defends Iraq Policy; California Firefighters Battle Destructive Wildfires
Aired October 28, 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, October 28. Here now, Lou Dobbs.
LOU DOBBS, CNN ANCHOR: Good evening.
Tonight: President Bush says the United States will stand its ground in Iraq. The president defended his policy six months after declaring an end to major combat operations in Iraq. Congressman Jim Saxton and former National Security Council official and CIA analyst Ken Pollack will be my guests.
Our special report, "The Great American Giveaway" -- tonight, government subsidies for agriculture in this country mean handouts for corporate farmers and tough times for family farmers. Lisa Sylvester reports.
And Democratic presidential candidates attack the president, as the economy shows signs of improvement. Ron Brownstein of "The Los Angeles Times," Roger Simon from "U.S. News & World Report" join me.
And the largest solar flare for the past century has left the surface of the sun hurtling towards Earth. A massive storm of charged particles will strike the Earth within the next 18 hours. Astrophysicist Charles Liu of the Rose Planetarium will join us to assess the likely impact.
In California tonight, firefighters are still battling to contain one of the most destructive series of wildfires in that state's history. The fires have now killed at least 16 people and burned more than 600,000 acres, an area almost the size of the state of Rhode Island. There are now 13 major fires burning. They stretch from the Simi Valley to the Mexican border. Firefighters are taking advantage of a break from the powerful Santa Ana winds that have fanned the flames with gusts up to 70 miles an hour.
We have two reports tonight, Miguel Marquez in the Rimforest in San Bernardino County. Brian Cabell is at Devil's Canyon in Los Angeles County.
We go to Brian first -- Brian.
BRIAN CABELL, CNN CORRESPONDENT: Lou, this is Devil's Canyon, as you say, an area about 15, 20 miles northwest of downtown Los Angeles, one of the prettiest areas in Southern California.
Yesterday, this entire mountainside here was entirely green. There was smoke in the background, threatening. But then, all last night, it turned to scorched earth, nothing but gray out there right now. The winds died down today, no flames visible right now as far as we can see. But this morning, a very different story, fire out of control in pockets all over the mountain, all over the canyon. Firefighters were monitoring those fires. Evacuations here had taken place hours earlier.
(BEGIN VIDEO CLIP)
CAPT. MARK KYLLINGSTAD, LOS ANGELES COUNTY FIRE DEPARTMENT: It was very orderly, because people who live in this area that this fire is part of living in Southern California, and that, if things go bad that and we start telling them to get ready to go, that they get packed up and they get ready to go.
(END VIDEO CLIP)
CABELL: After daybreak, there were still some hot spots out here in the canyon. And firefighters were out, those that were awake, setting backfires to protect the residents here.
And then, at daybreak also, choppers and fixed-wing aircraft were out here, an armada of them, dumping thousands upon thousands of gallons of water on the hot spots and on the flames. This is a big fire, more than 90,000 acres of it, but relatively unpopulated, only 40 homes burned here as a result. No deaths have been blamed on this fire as of yet.
But firefighters today Lou, have warned us that, even though it looks relatively calm out here, relatively harmless, no flames, very little smoke, they say, if the winds pick up and there's any embers out there, we could have problems again tonight -- Lou.
DOBBS: Brian, thank you -- Brian Cabell in Devil's Canyon in Los Angeles County.
There are three major fires burning tonight in San Diego County. The largest of those fires has now burned more than 300,000 acres along a 45-mile front. The so-called cedar fire is believed to be the largest fire ever in the history of California. It has already destroyed almost 900 homes. The California Department of Forestry today said it hopes to have this fire contained a week from tomorrow.
As this fire has spread, firefighters near exhaustion -- some are being pulled off the fire lines after they had worked for more than 36 hours straight without a break. San Diego mayor, Dick Murphy, today estimated the damage at $2 billion.
Further north, fires in San Bernardino County have burned almost 100,000 acres, destroying at least 500 homes. But the firefighters are meeting with some success now. Miguel Marquez reports from Rimforest in San Bernardino County. And he'll be joining us just as soon as we have the satellite signal back.
Turning to other news, the Pentagon today announced it's sending additional intelligence specialists to Iraq. The Pentagon said the specialists will try to improve the flow of intelligence to U.S. military commanders. In Iraq today, the coalition said another American soldier was and killed, six others wounded. There was also another suicide bomb attack on a police station. Two people were killed in that attack.
Ben Wedeman reports from Baghdad.
(BEGIN VIDEOTAPE)
BEN WEDEMAN, CNN CORRESPONDENT (voice-over): Another car bomb, more civilian victims, this attack in the town of Fallujah, west of Baghdad, just up the street from a police station.
Expressing their anger and grief through gunfire, Baghdad police marched in a funeral procession for one of their own killed in Monday's wave of car bombings in the capital. Three separate car bombs apparently aimed the Baghdad police stations killed more than 20 people. Concern is now growing, the Iraqi police, which coordinates closely with the U.S.-led coalition, is now the prime target of a shadowy, nameless resistance.
Meanwhile, the Red Cross is reassessing its presence in Iraq after a suicide bomber driving a van with Red Crescent markings killed 12 people, including two employees, just outside its office.
(on camera): Almost lost in the growing list of attacks, the assassination of Baghdad Deputy Mayor Faris al-Assam. He had just returned from the Madrid donors conference, where he had been lobbying for reconstruction money for Iraq. Coalition sources say he was shot dead outside his home.
Ben Wedeman, CNN, Baghdad.
(END VIDEOTAPE)
DOBBS: The United States is also still fighting a war in Afghanistan high in the mountains and a long way from the cameras of news organizations. Two more Americans have been killed in that war. They are civilian contractors who were working for the Central Intelligence Agency. The two men were helping Afghan army troops near the border with Pakistan. Nearly 20 enemy gunmen were killed in that same fight.
President Bush today delivered a blunt message to terrorists and insurgents in Iraq, saying the United States is not leaving. President Bush said the United States and its allies will stand their ground in Iraq. The president blamed the attacks on followers of Saddam Hussein and foreign terrorists.
Senior White House correspondent John King has the report -- John.
JOHN KING, CNN SR. WHITE HOUSE CORRESPONDENT: And, Lou, the president said in that Rose Garden news conference he was convinced beyond any doubt that the goal of the terrorists, whether they be Saddam loyalists or foreign fighters, was to drive the United States out of Iraq, also convince humanitarian groups and international troops not to come to Iraq.
Mr. Bush said he would not be intimidated by this, the president also saying that Iran and Syria must do a better job policing their borders to stop the flow of terrorists into Iraq. And the president, though, did acknowledge that, while he says his overall strategy is sound, there might need to be some adjustments.
(BEGIN VIDEO CLIP)
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: The strategy remains the same. The tactics to respond to more suiciders driving cars will alter on the ground, more checkpoints, whatever they decide. How to harden targets will change. And so we're constantly looking at the enemy and adjusting.
(END VIDEO CLIP)
KING: Now, a reflection in our latest poll today of the political environment Mr. Bush faces, questions and skepticism about his policy in postwar Iraq. Asked if the war in Iraq made the United States safer from terrorism, the American people, now 45 say safer; 43 percent say the war made the United States less safe.
Back in April, it was 58 percent who said the war in Iraq made the United States safer from terrorism, only 33 percent saying less safe, more criticism from the Democrats today. Several of the Democrats running for president criticized Mr. Bush's comments at his news conference. The Senate Democratic leader, Tom Daschle, said that, if this is progress in Iraq, Mr. Daschle said, he does not know how much more progress the United States can take.
Mr. Bush saying that -- at the news conference today that he understands this is a hot political issue. One reason he was in the Rose Garden was to respond to that criticism. But the president also promised to be even more aggressive in responding as the campaign heats up.
(BEGIN VIDEO CLIP)
BUSH: I will defend my record at the appropriate time, and look forward to it. I'll say that the world is more peaceful and more free under my leadership. And America is more secure. And that will be the -- that will be the -- that will be how I'll begin describing our foreign policy.
(END VIDEO CLIP)
KING: Now, you heard the president talk about possible changes in tactics. His military team, the defense secretary, Don Rumsfeld, the commanding general of U.S. forces in Iraq, other senior officials met at the White House several hours after the president's news conference to discuss strategy, sources telling us they have two urgent priorities.
One is improving the quality of the intelligence on the ground in Iraq, No. 2, accelerating the training and deployment of Iraqi police and other security forces -- Lou.
DOBBS: John, the 10th press conference of this president's term. Any idea why the White House chose, spontaneously, it seems, to have had this press conference today?
KING: Press Secretary Scott McClellan says a tentative decision was made during the president's Asia trip, that, once he got back, it would be a good opportunity to describe the trip and to meet with reporters for a news conference.
And they say, after the weekend and after this wave of recent attacks, not only the attacks and questions about the attacks, but the political criticism about the administration, they said the president decided first thing this morning would be a good time to go out and face the questions.
DOBBS: John, you keep very close account of these things. But, by my reckoning, this is the first time the president has acknowledged that there will be any adjustment in either strategy or tactics in Iraq.
KING: The president has consistently said he believed the strategy was working just fine and that, yes, there was a dangerous place in Iraq, but that progress was being made significantly. It was the first time we heard him specifically say in a public time to at least adjust the tactics some, yes, Lou.
DOBBS: John, thank you -- John King, our senior White House correspondent.
Coming up next: The increasingly sophisticated nature of the attacks in Iraq point to one group, according to my next guest. Ken Pollack once analyzed intelligence for the CIA, authored the book that many consider the template of the war against Saddam Hussein. Tonight, he joins us, and Congressman Jim Saxton, who has just returned from a trip throughout the Middle East and Iraq.
And our special report, "The Great American Giveaway" -- tonight, we focus on American farmers struggling, while big business reaps the benefits of government aid programs. Lisa Sylvester reports.
And a solar storm heading toward Earth at this very moment, one of the largest in history. Astrophysicist Charles Liu joins us.
Stay with us.
(COMMERCIAL BREAK)
DOBBS: My next guest says the terrorists and the insurgents in Iraq are clearly becoming more sophisticated, and that could indicate there are more al Qaeda in that country than the coalition has believed to this point.
I'm joined now by Ken Pollack, director of research at the Saban Center For Middle East Policy at the Brookings Institution and CNN analyst. Good to have you with us, Ken.
KENNETH POLLACK, CNN ANALYST: Thanks, Lou. Good to be here.
DOBBS: The tempo of these attacks is picking up. The sophistication is markedly improving. Does this augur a major offensive with which the U.S. military will have to contend in Baghdad and Iraq?
POLLACK: Well, I think, clearly, that's what the insurgents hope.
I think that the insurgents are trying to throw down the gauntlet to the United States. I think they're trying to say to the Iraqi people: We're here. We're going to make a lot of noise. We're going to really change the tenor of things. I think that they're trying to force the United States to dramatically change how it does business to take -- to be able to deal with these new attacks that they're launching.
DOBBS: The sophistication, the insidiousness of this terrorism, in the case of the bombing at the International Red Cross, that bomb was contained in an ambulance emblazoned with a red crescent. The bombings against at least one of the police stations, the bomb was carried in what appeared to be a police car. How are these things happening?
POLLACK: Well, look, you're getting to exactly the right points here, Lou, which is that one of two things may be going on.
We don't yet know exactly who is behind these attacks. It's other al Qaeda -- and, clearly, the sophistication of these attacks that you're talking about, the ruthlessness, the ability to coordinate them, suggests that this may very well be al Qaeda. If that's the case and there are more al Qaeda people in Iraq and they're having a better capability to launch attacks, that's a problem for the U.S.
The alternative is also very dangerous, which is that Saddam's own loyalists are becoming more and more sophisticated and more willing to actually kill themselves, conduct suicide attacks, which is not something we've seen in the past. That's also a dangerous trend.
DOBBS: Those trends being met with at least the first acknowledgement, as our White House correspondent John King just reported, the first suggestion by the president of a change in tactics in Iraq. We don't know what that change will -- what form those changes will take. What would you recommend?
POLLACK: Well, look, first, I think the administration is very smart to finally acknowledge this. I think it's necessary and I think that the American public have been out there and seeing these attacks, have been waiting to say, well, when are you going to do something different? And the administration coming forward, saying, we're going to try to do something different, that's a big step.
In terms of what to do different, a lot more focus has to go into intelligence work. And that intelligence work has to come in two focuses, one, tactical intelligence, getting people out on the ground, getting them to find out what's going on, being very aggressive, trying to locate these cells.
And, secondly, there's the strategic component as well, which really rests on the fate of the reconstruction. The more comfortable the Iraqi people are with the reconstruction, the more that they see their lights on, their water running, the happier they are, the more that they're going cooperate with the United States. And they are going to volunteer the information that is crucial.
DOBBS: Ken, there are few people who hold your credentials in the Middle East and understanding its politics. What this administration is not talking about, what even the critics of the Bush administration's Iraq policy are not focusing on, it seems to me, is, where are our friends in the region?
Saudi Arabia has not stepped forward. Neither has Kuwait, Jordan. This is a remarkably transparent lack of support on the part of countries that, at one point, 12 years ago, we were defending. Should there not be more of an effort by this administration, this government, to bring those so-called friendly countries in to support efforts in Iraq?
POLLACK: Certainly, I think the answer to that is yes.
But, unfortunately, part of the problem here is a result of the way that the administration got into the war. They got into the war in such a way that none of Iraq's allies were very comfortable with it. Some were certainly more comfortable than others. But all of them wished that the U.S. had handled things differently, wished that the U.S. had taken up the Arab-Israeli peace process first, that it done more to secure United Nations support.
The absence of those things, the fact that the administration didn't do them, makes them more reluctant to get involved now and that's something that I think the administration is going to have to find some very creative ways to deal with. And one way to do is, they could set up something along the lines of what we have with Afghanistan. You bring together all of the neighbors in a common conference and you allow them, you give them an opportunity to constantly talk with the United States and the new Iraqi leaders about what is going on in Iraq, so they get some input and they feel like they've got a role in the reconstruction.
That might get them to pony up some additional money, some additional forces.
DOBBS: A remarkable absence of involvement to this point.
Ken Pollack, as always, good to have you with us.
POLLACK: Thank you, Lou. Good to be with you.
DOBBS: Coming up next, "The Great American Giveaway" -- our special report tonight, a warning from one of this country's most influential investors, why the oracle of Omaha is concerned about those huge trade deficits. Peter Viles will report.
Stay with us.
(COMMERCIAL BREAK)
DOBBS: Tonight, in our series of special reports this week, "The Great American Giveaway," American government handouts to major farming corporations are making it almost impossible for the family farmer to compete. But those farm subsidies also cost the American taxpayer more than $100 billion over the past eight years.
Lisa Sylvester has the report from Washington.
(BEGIN VIDEOTAPE)
LISA SYLVESTER, CNN CORRESPONDENT (voice-over): Small family farms have been struggling to stay afloat in the last decade. They've looked to the government for help. But it's the agribusinesses and corporations that have collected the most. Since 1995, 10 percent of the largest American farms collected 71 percent of all farm subsidies, according to U.S. Department of Agriculture data.
TOM SCHATZ, CITIZENS AGAINST GOVERNMENT WASTE: Farm subsidies represent one of the most egregious wastes of tax dollars in Washington. They're inequitably distributed. They cost a lot of money.
SYLVESTER: The Fortune 500 companies raking in the most include the Archer Daniels Midland Corporation and some unexpected names, Chevron, John Hancock Mutual Life Insurance, DuPont, and Caterpillar. American consumers get hit twice. It's their tax dollars paying for these subsidies. And subsidizing large agribusinesses means American families pay more for products like corn, rice, wheat and sugar.
And U.S. agricultural policy is not winning friends overseas. The World Trade Organization talks stalled over the issue in September. Developing countries say the U.S. subsidies drive down global prices, shutting them out of their own markets.
CLYDE PRESTOWITZ, ECONOMIC STRATEGY INSTITUTE: If Mexican farmers can't make a living in Mexico raising corn or sugar or whatever their product, the easy alternative for them is to come north of the border and become illegal immigrants.
SYLVESTER: But farm groups insist the subsidies are needed, because, without them, there would not be a level playing field between the United States and other developed nations.
MARY KAY THATCHER, AMERICAN FARM BUREAU FEDERATION: It would be political suicide to unilaterally disarm and let everybody else go ahead and have their subsidies or their high tariff rates, because we wouldn't pick up any more places to export our goods and yet we'd open ourselves up to a lot more imports coming into this country.
(END VIDEOTAPE) SYLVESTER: But small family farmers say the subsidies are hurting them. They've watched their share of the subsidy pie shrink in the same few years, at the same time large agribusinesses have been gobbling up more of their small farms -- Lou.
DOBBS: Lisa, thank you very much -- Lisa Sylvester reporting from Washington.
American policies on farming aren't the only ones under fire tonight. One of this country's most successful, respected investors has issued a blunt warning on American trade policies. Warren Buffett warns that the United States is literally handing its net worth over to foreign investors.
Peter Viles is here now with the story.
"The Great American Giveaway," indeed, Pete.
PETER VILES, CNN CORRESPONDENT: It sure is.
This is a very stern warning, Lou, from Warren Buffett. And he's putting his money where his mouth is. For the time in his life, Buffett says he been betting against the American dollar.
(BEGIN VIDEOTAPE)
VILES (voice-over): In China, Commerce Secretary Don Evans carrying a message on trade: Watch out, because people back home are getting upset. The pressure is building, from Republicans like Don Manzullo, whose Illinois district is chockablock full of struggling factories, from Democrats like Brad Sherman, whose California district has been hurt by outsourcing of service jobs.
REP. BRAD SHERMAN (D), CALIFORNIA: The entire world economy is based on this bizarre notion of shipping huge amounts of goods and now services to the United States and accepting our promissory notes, our securities, ownership of our land. Well, eventually, we run out of securities that the world wants to buy. And then it crashes.
VILES: Now pressure from a new source, investor Warren Buffett, who writes in "Fortune" magazine -- quote -- "America's growing trade deficit is selling the nation out from under us." Buffett's calculations, there's roughly $50 trillion of wealth in the United States right now. But because of chronic trade deficits, foreigners own $2.5 trillion of it, or 5 percent of our national wealth, and because of trade deficits, are gaining roughly half-a-trillion a year.
STEVE EAST, ECONOMIST, FRIEDMAN BILLINGS RAMSEY: Mr. Buffett's point is well taken. The trade deficit isn't just something that could hurt us in the future. It's something that's hurting us right now. GDP would be 5.5 percent higher right now if it weren't for the trade deficit.
VILES: Back to Buffett. He's not just spouting off. He's putting his money behind his theory. Here's a chart of the U.S. dollar. And here's where Buffett started betting against the dollar, spring of last year, just about the time it peaked.
(END VIDEOTAPE)
VILES: Now, Buffett does have a plan to fix this, very simple. Let U.S. exporters sell the right to import goods into this country. Effectively, prices of exports would fall. Prices of imports would go up. Trade, by definition, would be in balance. It's very simple.
One problem, Lou, very doubtful the World Trade Organization would allow such a system.
DOBBS: The World Trade organize is posing major hurdles to rational trade policies, rational immigration policies right now.
VILES: We have locked into a system that benefits almost every other country in the world, because they want to sell to us, but it doesn't allow us to use unilateral policy to get out of this mess.
DOBBS: Benefiting nearly every country in the world, save this one.
VILES: It sure is.
DOBBS: The free-traders, notwithstanding.
Peter Viles, thank you.
That brings us tonight's poll question: Do you believe the federal government acts in your best economic interests usually, frequently, sometimes, or infrequently? Please cast vote at CNN.com/Lou. We'll have the results later in the show.
Coming up next: Congressman Jim Saxton has just returned from the Middle East and a visit to Iraq. He joins us. And then Ron Brownstein of "The Los Angeles Times" and Roger Simon of "U.S. News & World Report" will share their views on how the war is shaping the political landscape here at home. And one of the larger solar storms ever to emerge from the surface of the sun is headed for Earth. Astrophysicist Charles Liu, the American Museum of Natural History, joins us.
Please stay with us.
(COMMERCIAL BREAK)
DOBBS: As we've reported, more than 600,000 acres destroyed by wildfires in Southern California. Fires in San Bernardino County have burn almost 100,000 acres and destroyed 500 homes. But the firefighters are tonight reporting some success.
Miguel Marquez reports from Rimforest in San Bernardino, California -- Miguel.
MIGUEL MARQUEZ, CNN CORRESPONDENT: How are you there, Lou?
And this is proof of some of that success. It seems I'm at the rim of the World Highway, actually just below it. This morning, this was a forest. Right now, it is a safe zone. And it was protecting this area, the homes beyond the road where we stand, from the flames that are chopper -- the chopper pics from one of our affiliates is showing now, fire burning down north of San Bernardino, the Old Fire, apparently arson-caused, has been burning for several days.
Thousands of acres burned through. Two people have been killed, hundreds of homes destroyed. We shot some pictures of this area earlier today, as they were doing this burnout operation. Firefighters do this. They don't particularly like to do it, but they do it because they have no other choice. The fire is calling the shots. They had great wind conditions here to do this, because the wind -- the Santa Anas were blowing so stiffly, it kept the fire down toward the bottom of the hill, rather than up.
What's changing now, though, Lou, is that the fire is coming up this way, since the winds have now shifted. And that fire is going to make another run toward the top of this hill -- Lou.
DOBBS: Miguel Marquez, thank you very much.
To underscore, more than 600,000 acres have been destroyed. And, while there are some successes, as Miguel Marquez just reported, this fire, in no respect, is under control.
Turning now to the major story of the evening, the continuing war in Iraq, despite recent attacks the Pentagon continues to insist there are enough U.S. troops in that country. I'm joined by Congressman Jim Saxton, a member of the House Armed Services Committee, chairman of the Subcommittee on Terrorism. He's just returned from the Middle East and a visit to Iraq. Good to have you with us, congressman.
REP. JIM SAXTON (R), NEW JERSEY: Thank you, Lou.
DOBBS: The situation in Iraq obviously the scale of these attacks, their sophistication, their frequency are increasing.
How concerned are you about the stability of the country?
Do you really believe it's improving?
SAXTON: Well, like Ken Pollack said a few minutes ago on CNN, as you interviewed him, this is certainly a concern, and something that we've got to deal with. The attack on the Baghdad hotel actually occurred while we were in Iraq and that raised concerns. And the frequency and the severity of the attacks continues to raise concerns. But what I would like to also point out, though, there are a lot of things going on that don't seem to get reported in terms of getting life back to normal in Iraq.
DOBBS: Right.
SAXTON: The electric power is back on above prewar levels. Water's running again. Schools are reopening. We have rehabbed 1,600 schools since the war ended, so to speak. Security forces, it is estimated that we -- that they will need about 170,000 Iraqi security people in place. They've got 85,000 in place currently. And so the plan to get Iraq back to where it should be or where we'd like to see it in order for the Iraqi people to take care of themselves is well under way.
DOBBS: Bernard was here last evening and he talked about the urgency of the need for the $20 billion contained in the now in the legislation in conference. That $20 billion, whether it is a grant or a loan, do you really think that's material to the wellbeing of Iraqis and the security of U.S. forces there?
SAXTON: I certainly do. That, together with the now $13 billion that has been pledged by the international community moves us a long way toward the estimated $55 billion that will eventually be needed to put the country back together, to stabilize the country, get the oil industry up and running, to reopen all of the schools. We've got 1,600 open which are better than maybe 10 percent, 15 percent of the total. So there's been a lot accomplished so far, but certainly a lot to go. And the international effort to fund that rehab and that stabilization effort is absolutely necessary.
DOBBS: Congressman, you visited a number of U.S. allies in the region, Arab allies, Arab states. Do you have any sense that those nations which have depended upon us as I discussed with Ken Pollack over the years have willing to play a significant role Iraq and if not, why not?
SAXTON: Actually you get a mixed bag or mixed message from the countries. We visited Turkey, Kuwait, Bahrain, Qatar and Saudi Arabia. And everybody was different. For example, on the day we arrived in Turkey, two day after the parliament voted to authorize the use up to 10,000 troops to supplement activities that are going on currently in Iraq. We moved tonight Kuwait, we found out that they have to date used about a billion and a half Kuwaiti dollars to infuse into the war effort, if you will. Now translated that doesn't sound like a lot of money based on what we're contributing but if you converted that Iraqi economy to U.S. GDP dollars that would be almost $400 billion. Now we moved on to Saudi Arabia, for example, and they are very active in trying to limit the fund-raising that's going on in Saudi Arabia for Islamists charities. And to watch the flow -- stem the flow of the money going into the wrong places.
DOBBS: That's wonderful on the part of the Saudi government. But the fact is they are in the unique position to be helpful in Iraq yet the administration is not calling upon their overt, direct help, and one could rather easily, as many have argued, that the absolute duality of U.S. policy toward Saudi Arabia is the under pinning for much of our problems in the Middle East. Why not insist our so-called friends act like friends and assist in Iraq?
SAXTON: As I have said before we have been successful in some cases and less than successful in others. I am hopeful that everyone will get on board. And I believe as the Iraqi people gain in terms of their feeling of comfort or security, that they'll become more active and be of more help as well.
DOBBS: Congressman Jim Saxton, we thank you for being here tonight, appreciate it.
SAXTON: A pleasure.
DOBBS: The administration policy on Iraq is increasingly becoming a political I not only for Democrats but for Republican lawmakers, or at least some of them as well. Joining me to talk about these issues are Ron Brownstein, national political correspondent for "The Los Angeles Times", Roger Simon, political editor for "U.S. News and World Report." Good to see you both.
Hi, Lou.
Let me begin with you, Ron, since you are conveniently on the left. You've just heard the Congressman talk about the Iraq policy, the support and the latest polled shows erosion of independence narrowing of support for the president's policies.
How critical is it at this juncture?
RON BROWNSTEIN, "LOS ANGELES TIMES: Enormous polarization as well between Democrats and Republicans even on the most basic question of whether it was right to go to war in the first place. I notice in your poll, we're up to three-quarter of Democratic rank and file partisans saying that the U.S. should have never gone to war in Iraq in the first place and you're seeing the effect of that in the Democratic presidential race. There is no question that the combination of events on the ground, attitude among voters and the success of Howard Dean in the early state is pulling the field toward a more critical position of President Bush. Only two of the nine candidates overtly supported the $87 billion aid request. So, what we're heading for is a clear and pointed referendum on the president's policy toward dealing with terrorism, specifically Iraq, in the presidential election regardless of almost who is nominated as the Democratic choice.
DOBBS: Today, Roger, General Wesley Clark came out and just blasted President Bush, saying that any failure in intelligence is all about a moot discussion, belongs squarely on his desk, he is the man responsible for any failure. These attacks are getting very, to say the least, animated and bitter.
ROGER SIMON, "U.S. NEWS AND WORLD REPORT": They are, and I agree with Ron in the reasoning behind them. It's Because Howard dean did so well with them early on. And the fact the Democratic feel has moved over to his side to become more shrill, to try to capture the same vote helps Dean enormously. Several months ago you read stories how this was an angry man, how he was isolated and shrill. Well, now if you watch all of the Democratic debates are all like Howard Dean. I mean, General Clark was supposed to be a more acceptable version of Dean. Yes, he was against the war, he was more moderate, he was a general and a different branch of the Democratic party could embrace him. Well, as we have seen, there's no difference between General Clark and Howard Dean on the subject of George Bush.
DOBBS: No difference they're neck and neck in the national polling yet Dean is running significantly, I mean very significantly, ahead in New Hampshire. Ron, can Clark or any of these other candidates catch up?
BROWNSTEIN: That is the real question, Lou. Look, you have to different race. A race in Iowa and New Hampshire where the people know who these candidates are, they're watching ads on television, they're meeting them, they're seeing them in their media. And then you have these national numbers which are a much more loosely formed impression. The fact is where people are paying attention, Howard Dean is running about even, slightly behind Dick Gephardt in Iowa, way ahead in New Hampshire and raising more money than any other Democratic candidates which is allowing him buy television advertising and begin organizing. And the next round of states in February where the others are phantom presences at this point. It's a challenge for the other Democrats to find a strategy to slow down Dean and to emerge as the one clear alternative. We know he has to take it to the finals.
The question who, if anyone, can consolidate enough support to stand against him before he can put this away?
DOBBS: Looming also in contention here amongst the Democrats is the specter of improvement in Iraq. Congressman Saxton says things are getting better, obviously there are terrible casualties to American forces, but in are positives occurring as well, real improvement. We heard from the Federal Reserve today that employment is picking up. Suggesting very positive things in the economy.
How important is that to any of these Democratic candidates in the primary season?
SIMON: Well, an improved economy certainly helps George Bush, there's no doubt about that. I don't think the Democrats are worried things are going to improve in Iraq by November of next year. And in fact, neither the president nor his defense secretary held out much hope that that would happened.
DOBBS: Right. I'm talking about really amongst the Democrats, does an improving economy, we understand that that will be good for the Bush administration, good for the Republicans.
But does it play in to the Democratic primary politics at all?
SIMON: Not as much as an in a general. Obviously jobs is the focus of Democrats in all elects and it's going to be a huge focus in this election. A jobless recovery...
DOBBS: I think it has the focus...
(CROSSTALK)
SIMON: ...something that the Democrats are going to attack.
DOBBS: I think those jobs have the focus of the Republicans as well, Roger.
Ron, we just have a few seconds. BROWNSTEIN: Very quickly, Lou, the reality is, no matter what the external conditions are, the Democratic electorate is overwhelmingly anti-Bush. In that poll you put out today, his approval rating among Republicans was 93 percent. It was 16 percent among Democrats.
That's the driving force in the Democratic race. It's not likely to change between now and then. There's a competition among candidates to see who can basically convince their partisans that they'll be the toughest warrior against the president the Democrats don't like very much.
DOBBS: Ron Brownstein, Roger Simon, gentlemen, thank you very much. Appreciate it.
Coming up next, "Leading Questions," our series of special reports in conjunction with "The Economist" magazine tonight. We focus on the celebrity CEO. Are those multimillion dollar salaries and star quality enough to ensure success? We'll give you a hint -- no.
Stay with us.
(COMMERCIAL BREAK)
DOBBS: Tonight, we begin a series of special reports in conjunction with "The Economist" magazine focusing on leadership. We'll be looking at what makes a great CEO, how leadership styles have changed over the years and how they influence the quality of your investments and the conduct of corporations.
Tonight, CEO salaries. CEO pay has grown exponentially, as you know, in recent years. CEO performance simply hasn't kept up.
(BEGIN VIDEOTAPE)
DOBBS (voice-over): Twenty years ago, the average CEO made 42 times more than the average employee. Today, the average CEO makes 400 times more.
BUD CRYSTAL, EXECUTIVE COMPENSATION EXPERT: If I extrapolated what's going on, by about the year 2025 or so, would approximate what it was in 1789, where Louis XVI was king of France. And you know what happened to Louis XVI. And, of course, they got his wife too.
DOBBS: Maybe Europeans CEOs have learned from history. Their salaries are often only a quarter of their American counterparts.
DEREK BOK, AUTHOR, "THE COST OF TALENT": In Scandinavia, compensation levels like that would be an absolute scandal. They couldn't possibly be sustained.
DOBBS: Americans are losing their confidence in and patience with CEOs. A poll last year revealed only 23 percent of Americans trusted the bosses of large corporations. They scored even lower than journalists. Still, CEO pay isn't coming down.
FRANCES CAIRNCROSS, "THE ECONOMIST": The job of the chief executive has become much tougher. You're watched far more closely. You're watched by the communications business. You're watched by analysts. There are higher expectations of you. Society watches chief executives more than it would have done 20 years ago. The markets react much more quickly, much more fiercely.
DOBBS: When was the concept of the star CEO paid out of proportion with all others born?
Former Harvard President Derek Bok studied the history.
BOK: After World War II, when American had perhaps its most remarkable period of sustained growth, compensation of CEOs actually went up less rapidly than the compensation of blue collar workers. Then suddenly, in the 1970s, the CEO compensation began to take off. Now why did that happen? The growth of television. But as a result, the salaries of athletes and popular entertainers began to grow enormously. And I think that was somewhat contagious.
UNIDENTIFIED MALE: The CEOs themselves are very fond of saying, Well, look at what Arnold Schwarzenegger makes for a movie. Or look at what the sports star makes. Look at what Luciano Pavarotti. The arguments are very flawed. Every person I just mentioned is an individual performer. People pay money to see them do whatever it is they do in a world-class way.
DOBBS: Even Hollywood's star system, with stunning salaries of up to $30 million a film, is still at least an efficient market.
DAVID WIRTSCHAFTER, EXEC. VICE PRESIDENT, WILLIAM MORRIS AGENCY: A movie star is judged ultimately by how many people buy the product, how many people go to the movies.
UNIDENTIFIED MALE: It's easier to quantify. The box office is kind of the ultimate arbiter.
CAIRNCROSS: With a Hollywood star you know if they've been worth the investment the day the movie opens. Now, the effect of a good chief executive may take several years to come through. You don't see it immediately and it's much, much harder to measure.
RAKESH KHURANA, ASSISTANT PROFESSOR, HARVARD BUSINESS SCHOOL: A CEO works it a company with tens of thousands of employees. And to simply attribute that company's performance to a single individual largely borders on irrational.
DOBBS: In fact, a recent Harvard Business School study found that over 20 years, CEO performance explained only 14 percent of overall firm profitability.
UNIDENTIFIED MALE: You know, the easy part of pay for performance is high pay for high performance. You know, CEOs absorb that in their mother's milk. They know how to do that. But the hard part is low pay for low performance. Well, we won't take very much of a raise. But perish the thought that you should actually cut your pay. I mean, that's for the little people.
DOBBS: But others still argue that CEOs today constantly face make-or-break decisions and failure is a one-way street.
CAIRNCROSS: Boards are much more trigger happy than they used to be. And much more willing to chuck out a chief executive after 18 months or two years. The trouble is if you lose your job, you're dead. And hardly anybody returns from the dead. Wall Street remembers failure.
UNIDENTIFIED MALE: The argument that they may not have as long a shelf life as they used to is probably true. It's the old song, "Don't Cry for me, Argentina." You know, I mean, I get fired, I come away with $50 million. I'm crying all the way to the bank, you know.
DOBBS: But Hollywood does have comebacks.
DAD HAYES, ASSISTANT MANAGING EDITOR, "VARIETY": What's interesting about Hollywood stars is that they just seem to have nine lives. A lot of them, you know, John Travolta and Tommy Lee Jones -- you don't get the sense of, you know, wanting to kind of penalize an actor or a star whereas there's been a lot of bitterness about CEOs because the sense is that there's a public trust aspect to it. There's a shareholder responsibility as aspect to it.
DOBBS: So while Hollywood's star system has produced much of what entertains us, America's economic future is a much more serious business.
KHURANA: I think the CEO star system was always broken. The idea of placing your faith in a single individual has proven false over and over again in all aspects of history. And I think we can look at the handful of great companies in which people do this.
They develop people internally. They allow ordinary people to do extraordinary things. Those are the kinds of CEOs we need. Those are the kinds of CEOs in which corporate America was built. Those are the kind of CEOs that we need to return to.
(END VIDEOTAPE)
DOBBS: And that's the kind of CEO we'll be focusing on here tomorrow. We look a the performance of one CEO who has lifted his company performance to new heights, and its stock price as well. Join us tomorrow night.
Coming up next -- a storm of heated gas and particles from the surface of the sun will hit the Earth by tomorrow. Astrophysicist Charles Liu of the Rose Center for Earth and Space at the American Museum of Natural History joins us to explain the likely impact. Stay with us.
(COMMERCIAL BREAK) DOBBS: One of the most powerful solar flares ever recorded erupted from a giant sun spot this morning, sending a storm of charged particles hurdling toward Earth. Forecasters say this blast is moving toward Earth at a rate of almost five million miles an hour. It is expected to hit by midday tomorrow.
My guest is Charles Liu, he's astrophysicist at the Museum of Natural History, professor of astrophysics at CUNY, and he always joins us for all affairs celestial and to help us understand issues that are so complex I can't even begin to grasp what's going on. So thanks for being here.
CHARLES LIU, ASTROPHYSICIST, AMERICAN MUSEUM OF NATURAL HISTORY: My pleasure.
DOBBS: This -- the sun spot, it sounds in many ways horrific, five million miles an hour, the third most powerful ever. How concerned should we be?
LIU: All I can say is don't panic.
DOBBS: OK, I promise.
LIU: It's actually not as fearful as it sounds. Although it is the third most powerful storm ever measured on the sun, based on its X-ray flux. By the time it gets to the surface of the Earth, where we are, we human beings are hardly affected at all.
DOBBS: How big is it?
LIU: Well, it comes from a sun spot. Its area is over 100 times the size of the Earth. So it's coming toward us pretty fast.
DOBBS: I'm moving toward panic now, Charles.
LIU: The thing is, only very large systems, such as, say, power grids or pipeline systems, electrical conducting systems will affect -- be affected in any significant way. Earth's magnetic field protects everything on the surface in almost all ways.
DOBBS: It just got hit last week by a moderate sized solar flare.
LIU: That's right, and nothing happened to us, right?
DOBBS: Does that have a lasting effect? Is there anything that happens from a frequency of being hit?
LIU: Usually, no. The 11-year cycle that the sun has in sun spots right now is sort of on its way down. We had a max called solar max in the year 2000-2001, and we often get hit many, many times in a week or a month during solar max with almost no effect.
DOBBS: You don't expect there to be a significant amount of electrical outages or power grid problems? I know I'm putting you on the spot... LIU: Not at all.
DOBBS: ... because frankly there's no way to judge these things before.
LIU: It's hard to predict. When we are predicting the powers of storms and so forth coming in. But I would say that to the extent that technology affects our lives it may cause us some problems. But on a day-to-day level, just go outside and look at the northern lights that are coming down. They may be visible as far south as Hawaii. And very beautiful.
DOBBS: And in the continental United States?
LIU: Yeah, all throughout. If the weather's clear, let's hope that works out really well.
DOBBS: I'm with you, Charles. And thank you for being with us.
LIU: Always a pleasure.
DOBBS: To guide us through this. Charles Liu, thank you.
Coming up next, your e-mails, including your thoughts on the massive influx of illegal aliens into this country and what corporate America should be doing to stop it. Stay it us.
(COMMERCIAL BREAK)
DOBBS: Well, that just about says it all.
Stocks rallied on Wall Street after the Fed left interest rates unchanged, and said the job market is showing signs of improvement. The Dow today gained 140 points, the Nasdaq up nearly 50. And the S&P 500 up more than 15.
Let's take a look at some of your thoughts now. From San Rafael, California: "Why not go after the companies that hire these illegals? They get off, but these illegals are shipped back. If the corporations refused to hire them, they would not come here looking for jobs as they would not exist." That from Wendy Murphy.
From Ft. Collins, Colorado: "Dear Lou, I admire your courage in covering our immigration issues. Ours is a multi-ethnic household, and we are continually amazed that people who stand up for immigration control are branded as racist. This year, our economy will create two million jobs, if we're lucky, yet legal plus illegal immigration will probably be over three million. How does that compute?" That from Kip Dunn.
And from White Lake, Michigan: "We appreciate your series on the Great American Giveaway, especially the report on the illegal immigrants taking American jobs. The assumption that American workers do not want these jobs is false. What Americans do want is a fair wage. Raise the wage and there will be plenty of takers." That from Kathleen Linck. From Delmont, Pennsylvania: "Very interesting. President Bush wants Syria and Iran to tighten up their borders, while he cannot control those he is responsible for." Interesting point, Dick Boley. Thanks for e-mailing us.
E-mail us at loudobbs@cnn.com. That's our show for tonight. Thanks for being with us. For all of us here, good night from New York. "ANDERSON COOPER 360" is next.
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Firefighters Battle Destructive Wildfires>
Aired October 28, 2003 - 18:00 ET
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, October 28. Here now, Lou Dobbs.
LOU DOBBS, CNN ANCHOR: Good evening.
Tonight: President Bush says the United States will stand its ground in Iraq. The president defended his policy six months after declaring an end to major combat operations in Iraq. Congressman Jim Saxton and former National Security Council official and CIA analyst Ken Pollack will be my guests.
Our special report, "The Great American Giveaway" -- tonight, government subsidies for agriculture in this country mean handouts for corporate farmers and tough times for family farmers. Lisa Sylvester reports.
And Democratic presidential candidates attack the president, as the economy shows signs of improvement. Ron Brownstein of "The Los Angeles Times," Roger Simon from "U.S. News & World Report" join me.
And the largest solar flare for the past century has left the surface of the sun hurtling towards Earth. A massive storm of charged particles will strike the Earth within the next 18 hours. Astrophysicist Charles Liu of the Rose Planetarium will join us to assess the likely impact.
In California tonight, firefighters are still battling to contain one of the most destructive series of wildfires in that state's history. The fires have now killed at least 16 people and burned more than 600,000 acres, an area almost the size of the state of Rhode Island. There are now 13 major fires burning. They stretch from the Simi Valley to the Mexican border. Firefighters are taking advantage of a break from the powerful Santa Ana winds that have fanned the flames with gusts up to 70 miles an hour.
We have two reports tonight, Miguel Marquez in the Rimforest in San Bernardino County. Brian Cabell is at Devil's Canyon in Los Angeles County.
We go to Brian first -- Brian.
BRIAN CABELL, CNN CORRESPONDENT: Lou, this is Devil's Canyon, as you say, an area about 15, 20 miles northwest of downtown Los Angeles, one of the prettiest areas in Southern California.
Yesterday, this entire mountainside here was entirely green. There was smoke in the background, threatening. But then, all last night, it turned to scorched earth, nothing but gray out there right now. The winds died down today, no flames visible right now as far as we can see. But this morning, a very different story, fire out of control in pockets all over the mountain, all over the canyon. Firefighters were monitoring those fires. Evacuations here had taken place hours earlier.
(BEGIN VIDEO CLIP)
CAPT. MARK KYLLINGSTAD, LOS ANGELES COUNTY FIRE DEPARTMENT: It was very orderly, because people who live in this area that this fire is part of living in Southern California, and that, if things go bad that and we start telling them to get ready to go, that they get packed up and they get ready to go.
(END VIDEO CLIP)
CABELL: After daybreak, there were still some hot spots out here in the canyon. And firefighters were out, those that were awake, setting backfires to protect the residents here.
And then, at daybreak also, choppers and fixed-wing aircraft were out here, an armada of them, dumping thousands upon thousands of gallons of water on the hot spots and on the flames. This is a big fire, more than 90,000 acres of it, but relatively unpopulated, only 40 homes burned here as a result. No deaths have been blamed on this fire as of yet.
But firefighters today Lou, have warned us that, even though it looks relatively calm out here, relatively harmless, no flames, very little smoke, they say, if the winds pick up and there's any embers out there, we could have problems again tonight -- Lou.
DOBBS: Brian, thank you -- Brian Cabell in Devil's Canyon in Los Angeles County.
There are three major fires burning tonight in San Diego County. The largest of those fires has now burned more than 300,000 acres along a 45-mile front. The so-called cedar fire is believed to be the largest fire ever in the history of California. It has already destroyed almost 900 homes. The California Department of Forestry today said it hopes to have this fire contained a week from tomorrow.
As this fire has spread, firefighters near exhaustion -- some are being pulled off the fire lines after they had worked for more than 36 hours straight without a break. San Diego mayor, Dick Murphy, today estimated the damage at $2 billion.
Further north, fires in San Bernardino County have burned almost 100,000 acres, destroying at least 500 homes. But the firefighters are meeting with some success now. Miguel Marquez reports from Rimforest in San Bernardino County. And he'll be joining us just as soon as we have the satellite signal back.
Turning to other news, the Pentagon today announced it's sending additional intelligence specialists to Iraq. The Pentagon said the specialists will try to improve the flow of intelligence to U.S. military commanders. In Iraq today, the coalition said another American soldier was and killed, six others wounded. There was also another suicide bomb attack on a police station. Two people were killed in that attack.
Ben Wedeman reports from Baghdad.
(BEGIN VIDEOTAPE)
BEN WEDEMAN, CNN CORRESPONDENT (voice-over): Another car bomb, more civilian victims, this attack in the town of Fallujah, west of Baghdad, just up the street from a police station.
Expressing their anger and grief through gunfire, Baghdad police marched in a funeral procession for one of their own killed in Monday's wave of car bombings in the capital. Three separate car bombs apparently aimed the Baghdad police stations killed more than 20 people. Concern is now growing, the Iraqi police, which coordinates closely with the U.S.-led coalition, is now the prime target of a shadowy, nameless resistance.
Meanwhile, the Red Cross is reassessing its presence in Iraq after a suicide bomber driving a van with Red Crescent markings killed 12 people, including two employees, just outside its office.
(on camera): Almost lost in the growing list of attacks, the assassination of Baghdad Deputy Mayor Faris al-Assam. He had just returned from the Madrid donors conference, where he had been lobbying for reconstruction money for Iraq. Coalition sources say he was shot dead outside his home.
Ben Wedeman, CNN, Baghdad.
(END VIDEOTAPE)
DOBBS: The United States is also still fighting a war in Afghanistan high in the mountains and a long way from the cameras of news organizations. Two more Americans have been killed in that war. They are civilian contractors who were working for the Central Intelligence Agency. The two men were helping Afghan army troops near the border with Pakistan. Nearly 20 enemy gunmen were killed in that same fight.
President Bush today delivered a blunt message to terrorists and insurgents in Iraq, saying the United States is not leaving. President Bush said the United States and its allies will stand their ground in Iraq. The president blamed the attacks on followers of Saddam Hussein and foreign terrorists.
Senior White House correspondent John King has the report -- John.
JOHN KING, CNN SR. WHITE HOUSE CORRESPONDENT: And, Lou, the president said in that Rose Garden news conference he was convinced beyond any doubt that the goal of the terrorists, whether they be Saddam loyalists or foreign fighters, was to drive the United States out of Iraq, also convince humanitarian groups and international troops not to come to Iraq.
Mr. Bush said he would not be intimidated by this, the president also saying that Iran and Syria must do a better job policing their borders to stop the flow of terrorists into Iraq. And the president, though, did acknowledge that, while he says his overall strategy is sound, there might need to be some adjustments.
(BEGIN VIDEO CLIP)
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: The strategy remains the same. The tactics to respond to more suiciders driving cars will alter on the ground, more checkpoints, whatever they decide. How to harden targets will change. And so we're constantly looking at the enemy and adjusting.
(END VIDEO CLIP)
KING: Now, a reflection in our latest poll today of the political environment Mr. Bush faces, questions and skepticism about his policy in postwar Iraq. Asked if the war in Iraq made the United States safer from terrorism, the American people, now 45 say safer; 43 percent say the war made the United States less safe.
Back in April, it was 58 percent who said the war in Iraq made the United States safer from terrorism, only 33 percent saying less safe, more criticism from the Democrats today. Several of the Democrats running for president criticized Mr. Bush's comments at his news conference. The Senate Democratic leader, Tom Daschle, said that, if this is progress in Iraq, Mr. Daschle said, he does not know how much more progress the United States can take.
Mr. Bush saying that -- at the news conference today that he understands this is a hot political issue. One reason he was in the Rose Garden was to respond to that criticism. But the president also promised to be even more aggressive in responding as the campaign heats up.
(BEGIN VIDEO CLIP)
BUSH: I will defend my record at the appropriate time, and look forward to it. I'll say that the world is more peaceful and more free under my leadership. And America is more secure. And that will be the -- that will be the -- that will be how I'll begin describing our foreign policy.
(END VIDEO CLIP)
KING: Now, you heard the president talk about possible changes in tactics. His military team, the defense secretary, Don Rumsfeld, the commanding general of U.S. forces in Iraq, other senior officials met at the White House several hours after the president's news conference to discuss strategy, sources telling us they have two urgent priorities.
One is improving the quality of the intelligence on the ground in Iraq, No. 2, accelerating the training and deployment of Iraqi police and other security forces -- Lou.
DOBBS: John, the 10th press conference of this president's term. Any idea why the White House chose, spontaneously, it seems, to have had this press conference today?
KING: Press Secretary Scott McClellan says a tentative decision was made during the president's Asia trip, that, once he got back, it would be a good opportunity to describe the trip and to meet with reporters for a news conference.
And they say, after the weekend and after this wave of recent attacks, not only the attacks and questions about the attacks, but the political criticism about the administration, they said the president decided first thing this morning would be a good time to go out and face the questions.
DOBBS: John, you keep very close account of these things. But, by my reckoning, this is the first time the president has acknowledged that there will be any adjustment in either strategy or tactics in Iraq.
KING: The president has consistently said he believed the strategy was working just fine and that, yes, there was a dangerous place in Iraq, but that progress was being made significantly. It was the first time we heard him specifically say in a public time to at least adjust the tactics some, yes, Lou.
DOBBS: John, thank you -- John King, our senior White House correspondent.
Coming up next: The increasingly sophisticated nature of the attacks in Iraq point to one group, according to my next guest. Ken Pollack once analyzed intelligence for the CIA, authored the book that many consider the template of the war against Saddam Hussein. Tonight, he joins us, and Congressman Jim Saxton, who has just returned from a trip throughout the Middle East and Iraq.
And our special report, "The Great American Giveaway" -- tonight, we focus on American farmers struggling, while big business reaps the benefits of government aid programs. Lisa Sylvester reports.
And a solar storm heading toward Earth at this very moment, one of the largest in history. Astrophysicist Charles Liu joins us.
Stay with us.
(COMMERCIAL BREAK)
DOBBS: My next guest says the terrorists and the insurgents in Iraq are clearly becoming more sophisticated, and that could indicate there are more al Qaeda in that country than the coalition has believed to this point.
I'm joined now by Ken Pollack, director of research at the Saban Center For Middle East Policy at the Brookings Institution and CNN analyst. Good to have you with us, Ken.
KENNETH POLLACK, CNN ANALYST: Thanks, Lou. Good to be here.
DOBBS: The tempo of these attacks is picking up. The sophistication is markedly improving. Does this augur a major offensive with which the U.S. military will have to contend in Baghdad and Iraq?
POLLACK: Well, I think, clearly, that's what the insurgents hope.
I think that the insurgents are trying to throw down the gauntlet to the United States. I think they're trying to say to the Iraqi people: We're here. We're going to make a lot of noise. We're going to really change the tenor of things. I think that they're trying to force the United States to dramatically change how it does business to take -- to be able to deal with these new attacks that they're launching.
DOBBS: The sophistication, the insidiousness of this terrorism, in the case of the bombing at the International Red Cross, that bomb was contained in an ambulance emblazoned with a red crescent. The bombings against at least one of the police stations, the bomb was carried in what appeared to be a police car. How are these things happening?
POLLACK: Well, look, you're getting to exactly the right points here, Lou, which is that one of two things may be going on.
We don't yet know exactly who is behind these attacks. It's other al Qaeda -- and, clearly, the sophistication of these attacks that you're talking about, the ruthlessness, the ability to coordinate them, suggests that this may very well be al Qaeda. If that's the case and there are more al Qaeda people in Iraq and they're having a better capability to launch attacks, that's a problem for the U.S.
The alternative is also very dangerous, which is that Saddam's own loyalists are becoming more and more sophisticated and more willing to actually kill themselves, conduct suicide attacks, which is not something we've seen in the past. That's also a dangerous trend.
DOBBS: Those trends being met with at least the first acknowledgement, as our White House correspondent John King just reported, the first suggestion by the president of a change in tactics in Iraq. We don't know what that change will -- what form those changes will take. What would you recommend?
POLLACK: Well, look, first, I think the administration is very smart to finally acknowledge this. I think it's necessary and I think that the American public have been out there and seeing these attacks, have been waiting to say, well, when are you going to do something different? And the administration coming forward, saying, we're going to try to do something different, that's a big step.
In terms of what to do different, a lot more focus has to go into intelligence work. And that intelligence work has to come in two focuses, one, tactical intelligence, getting people out on the ground, getting them to find out what's going on, being very aggressive, trying to locate these cells.
And, secondly, there's the strategic component as well, which really rests on the fate of the reconstruction. The more comfortable the Iraqi people are with the reconstruction, the more that they see their lights on, their water running, the happier they are, the more that they're going cooperate with the United States. And they are going to volunteer the information that is crucial.
DOBBS: Ken, there are few people who hold your credentials in the Middle East and understanding its politics. What this administration is not talking about, what even the critics of the Bush administration's Iraq policy are not focusing on, it seems to me, is, where are our friends in the region?
Saudi Arabia has not stepped forward. Neither has Kuwait, Jordan. This is a remarkably transparent lack of support on the part of countries that, at one point, 12 years ago, we were defending. Should there not be more of an effort by this administration, this government, to bring those so-called friendly countries in to support efforts in Iraq?
POLLACK: Certainly, I think the answer to that is yes.
But, unfortunately, part of the problem here is a result of the way that the administration got into the war. They got into the war in such a way that none of Iraq's allies were very comfortable with it. Some were certainly more comfortable than others. But all of them wished that the U.S. had handled things differently, wished that the U.S. had taken up the Arab-Israeli peace process first, that it done more to secure United Nations support.
The absence of those things, the fact that the administration didn't do them, makes them more reluctant to get involved now and that's something that I think the administration is going to have to find some very creative ways to deal with. And one way to do is, they could set up something along the lines of what we have with Afghanistan. You bring together all of the neighbors in a common conference and you allow them, you give them an opportunity to constantly talk with the United States and the new Iraqi leaders about what is going on in Iraq, so they get some input and they feel like they've got a role in the reconstruction.
That might get them to pony up some additional money, some additional forces.
DOBBS: A remarkable absence of involvement to this point.
Ken Pollack, as always, good to have you with us.
POLLACK: Thank you, Lou. Good to be with you.
DOBBS: Coming up next, "The Great American Giveaway" -- our special report tonight, a warning from one of this country's most influential investors, why the oracle of Omaha is concerned about those huge trade deficits. Peter Viles will report.
Stay with us.
(COMMERCIAL BREAK)
DOBBS: Tonight, in our series of special reports this week, "The Great American Giveaway," American government handouts to major farming corporations are making it almost impossible for the family farmer to compete. But those farm subsidies also cost the American taxpayer more than $100 billion over the past eight years.
Lisa Sylvester has the report from Washington.
(BEGIN VIDEOTAPE)
LISA SYLVESTER, CNN CORRESPONDENT (voice-over): Small family farms have been struggling to stay afloat in the last decade. They've looked to the government for help. But it's the agribusinesses and corporations that have collected the most. Since 1995, 10 percent of the largest American farms collected 71 percent of all farm subsidies, according to U.S. Department of Agriculture data.
TOM SCHATZ, CITIZENS AGAINST GOVERNMENT WASTE: Farm subsidies represent one of the most egregious wastes of tax dollars in Washington. They're inequitably distributed. They cost a lot of money.
SYLVESTER: The Fortune 500 companies raking in the most include the Archer Daniels Midland Corporation and some unexpected names, Chevron, John Hancock Mutual Life Insurance, DuPont, and Caterpillar. American consumers get hit twice. It's their tax dollars paying for these subsidies. And subsidizing large agribusinesses means American families pay more for products like corn, rice, wheat and sugar.
And U.S. agricultural policy is not winning friends overseas. The World Trade Organization talks stalled over the issue in September. Developing countries say the U.S. subsidies drive down global prices, shutting them out of their own markets.
CLYDE PRESTOWITZ, ECONOMIC STRATEGY INSTITUTE: If Mexican farmers can't make a living in Mexico raising corn or sugar or whatever their product, the easy alternative for them is to come north of the border and become illegal immigrants.
SYLVESTER: But farm groups insist the subsidies are needed, because, without them, there would not be a level playing field between the United States and other developed nations.
MARY KAY THATCHER, AMERICAN FARM BUREAU FEDERATION: It would be political suicide to unilaterally disarm and let everybody else go ahead and have their subsidies or their high tariff rates, because we wouldn't pick up any more places to export our goods and yet we'd open ourselves up to a lot more imports coming into this country.
(END VIDEOTAPE) SYLVESTER: But small family farmers say the subsidies are hurting them. They've watched their share of the subsidy pie shrink in the same few years, at the same time large agribusinesses have been gobbling up more of their small farms -- Lou.
DOBBS: Lisa, thank you very much -- Lisa Sylvester reporting from Washington.
American policies on farming aren't the only ones under fire tonight. One of this country's most successful, respected investors has issued a blunt warning on American trade policies. Warren Buffett warns that the United States is literally handing its net worth over to foreign investors.
Peter Viles is here now with the story.
"The Great American Giveaway," indeed, Pete.
PETER VILES, CNN CORRESPONDENT: It sure is.
This is a very stern warning, Lou, from Warren Buffett. And he's putting his money where his mouth is. For the time in his life, Buffett says he been betting against the American dollar.
(BEGIN VIDEOTAPE)
VILES (voice-over): In China, Commerce Secretary Don Evans carrying a message on trade: Watch out, because people back home are getting upset. The pressure is building, from Republicans like Don Manzullo, whose Illinois district is chockablock full of struggling factories, from Democrats like Brad Sherman, whose California district has been hurt by outsourcing of service jobs.
REP. BRAD SHERMAN (D), CALIFORNIA: The entire world economy is based on this bizarre notion of shipping huge amounts of goods and now services to the United States and accepting our promissory notes, our securities, ownership of our land. Well, eventually, we run out of securities that the world wants to buy. And then it crashes.
VILES: Now pressure from a new source, investor Warren Buffett, who writes in "Fortune" magazine -- quote -- "America's growing trade deficit is selling the nation out from under us." Buffett's calculations, there's roughly $50 trillion of wealth in the United States right now. But because of chronic trade deficits, foreigners own $2.5 trillion of it, or 5 percent of our national wealth, and because of trade deficits, are gaining roughly half-a-trillion a year.
STEVE EAST, ECONOMIST, FRIEDMAN BILLINGS RAMSEY: Mr. Buffett's point is well taken. The trade deficit isn't just something that could hurt us in the future. It's something that's hurting us right now. GDP would be 5.5 percent higher right now if it weren't for the trade deficit.
VILES: Back to Buffett. He's not just spouting off. He's putting his money behind his theory. Here's a chart of the U.S. dollar. And here's where Buffett started betting against the dollar, spring of last year, just about the time it peaked.
(END VIDEOTAPE)
VILES: Now, Buffett does have a plan to fix this, very simple. Let U.S. exporters sell the right to import goods into this country. Effectively, prices of exports would fall. Prices of imports would go up. Trade, by definition, would be in balance. It's very simple.
One problem, Lou, very doubtful the World Trade Organization would allow such a system.
DOBBS: The World Trade organize is posing major hurdles to rational trade policies, rational immigration policies right now.
VILES: We have locked into a system that benefits almost every other country in the world, because they want to sell to us, but it doesn't allow us to use unilateral policy to get out of this mess.
DOBBS: Benefiting nearly every country in the world, save this one.
VILES: It sure is.
DOBBS: The free-traders, notwithstanding.
Peter Viles, thank you.
That brings us tonight's poll question: Do you believe the federal government acts in your best economic interests usually, frequently, sometimes, or infrequently? Please cast vote at CNN.com/Lou. We'll have the results later in the show.
Coming up next: Congressman Jim Saxton has just returned from the Middle East and a visit to Iraq. He joins us. And then Ron Brownstein of "The Los Angeles Times" and Roger Simon of "U.S. News & World Report" will share their views on how the war is shaping the political landscape here at home. And one of the larger solar storms ever to emerge from the surface of the sun is headed for Earth. Astrophysicist Charles Liu, the American Museum of Natural History, joins us.
Please stay with us.
(COMMERCIAL BREAK)
DOBBS: As we've reported, more than 600,000 acres destroyed by wildfires in Southern California. Fires in San Bernardino County have burn almost 100,000 acres and destroyed 500 homes. But the firefighters are tonight reporting some success.
Miguel Marquez reports from Rimforest in San Bernardino, California -- Miguel.
MIGUEL MARQUEZ, CNN CORRESPONDENT: How are you there, Lou?
And this is proof of some of that success. It seems I'm at the rim of the World Highway, actually just below it. This morning, this was a forest. Right now, it is a safe zone. And it was protecting this area, the homes beyond the road where we stand, from the flames that are chopper -- the chopper pics from one of our affiliates is showing now, fire burning down north of San Bernardino, the Old Fire, apparently arson-caused, has been burning for several days.
Thousands of acres burned through. Two people have been killed, hundreds of homes destroyed. We shot some pictures of this area earlier today, as they were doing this burnout operation. Firefighters do this. They don't particularly like to do it, but they do it because they have no other choice. The fire is calling the shots. They had great wind conditions here to do this, because the wind -- the Santa Anas were blowing so stiffly, it kept the fire down toward the bottom of the hill, rather than up.
What's changing now, though, Lou, is that the fire is coming up this way, since the winds have now shifted. And that fire is going to make another run toward the top of this hill -- Lou.
DOBBS: Miguel Marquez, thank you very much.
To underscore, more than 600,000 acres have been destroyed. And, while there are some successes, as Miguel Marquez just reported, this fire, in no respect, is under control.
Turning now to the major story of the evening, the continuing war in Iraq, despite recent attacks the Pentagon continues to insist there are enough U.S. troops in that country. I'm joined by Congressman Jim Saxton, a member of the House Armed Services Committee, chairman of the Subcommittee on Terrorism. He's just returned from the Middle East and a visit to Iraq. Good to have you with us, congressman.
REP. JIM SAXTON (R), NEW JERSEY: Thank you, Lou.
DOBBS: The situation in Iraq obviously the scale of these attacks, their sophistication, their frequency are increasing.
How concerned are you about the stability of the country?
Do you really believe it's improving?
SAXTON: Well, like Ken Pollack said a few minutes ago on CNN, as you interviewed him, this is certainly a concern, and something that we've got to deal with. The attack on the Baghdad hotel actually occurred while we were in Iraq and that raised concerns. And the frequency and the severity of the attacks continues to raise concerns. But what I would like to also point out, though, there are a lot of things going on that don't seem to get reported in terms of getting life back to normal in Iraq.
DOBBS: Right.
SAXTON: The electric power is back on above prewar levels. Water's running again. Schools are reopening. We have rehabbed 1,600 schools since the war ended, so to speak. Security forces, it is estimated that we -- that they will need about 170,000 Iraqi security people in place. They've got 85,000 in place currently. And so the plan to get Iraq back to where it should be or where we'd like to see it in order for the Iraqi people to take care of themselves is well under way.
DOBBS: Bernard was here last evening and he talked about the urgency of the need for the $20 billion contained in the now in the legislation in conference. That $20 billion, whether it is a grant or a loan, do you really think that's material to the wellbeing of Iraqis and the security of U.S. forces there?
SAXTON: I certainly do. That, together with the now $13 billion that has been pledged by the international community moves us a long way toward the estimated $55 billion that will eventually be needed to put the country back together, to stabilize the country, get the oil industry up and running, to reopen all of the schools. We've got 1,600 open which are better than maybe 10 percent, 15 percent of the total. So there's been a lot accomplished so far, but certainly a lot to go. And the international effort to fund that rehab and that stabilization effort is absolutely necessary.
DOBBS: Congressman, you visited a number of U.S. allies in the region, Arab allies, Arab states. Do you have any sense that those nations which have depended upon us as I discussed with Ken Pollack over the years have willing to play a significant role Iraq and if not, why not?
SAXTON: Actually you get a mixed bag or mixed message from the countries. We visited Turkey, Kuwait, Bahrain, Qatar and Saudi Arabia. And everybody was different. For example, on the day we arrived in Turkey, two day after the parliament voted to authorize the use up to 10,000 troops to supplement activities that are going on currently in Iraq. We moved tonight Kuwait, we found out that they have to date used about a billion and a half Kuwaiti dollars to infuse into the war effort, if you will. Now translated that doesn't sound like a lot of money based on what we're contributing but if you converted that Iraqi economy to U.S. GDP dollars that would be almost $400 billion. Now we moved on to Saudi Arabia, for example, and they are very active in trying to limit the fund-raising that's going on in Saudi Arabia for Islamists charities. And to watch the flow -- stem the flow of the money going into the wrong places.
DOBBS: That's wonderful on the part of the Saudi government. But the fact is they are in the unique position to be helpful in Iraq yet the administration is not calling upon their overt, direct help, and one could rather easily, as many have argued, that the absolute duality of U.S. policy toward Saudi Arabia is the under pinning for much of our problems in the Middle East. Why not insist our so-called friends act like friends and assist in Iraq?
SAXTON: As I have said before we have been successful in some cases and less than successful in others. I am hopeful that everyone will get on board. And I believe as the Iraqi people gain in terms of their feeling of comfort or security, that they'll become more active and be of more help as well.
DOBBS: Congressman Jim Saxton, we thank you for being here tonight, appreciate it.
SAXTON: A pleasure.
DOBBS: The administration policy on Iraq is increasingly becoming a political I not only for Democrats but for Republican lawmakers, or at least some of them as well. Joining me to talk about these issues are Ron Brownstein, national political correspondent for "The Los Angeles Times", Roger Simon, political editor for "U.S. News and World Report." Good to see you both.
Hi, Lou.
Let me begin with you, Ron, since you are conveniently on the left. You've just heard the Congressman talk about the Iraq policy, the support and the latest polled shows erosion of independence narrowing of support for the president's policies.
How critical is it at this juncture?
RON BROWNSTEIN, "LOS ANGELES TIMES: Enormous polarization as well between Democrats and Republicans even on the most basic question of whether it was right to go to war in the first place. I notice in your poll, we're up to three-quarter of Democratic rank and file partisans saying that the U.S. should have never gone to war in Iraq in the first place and you're seeing the effect of that in the Democratic presidential race. There is no question that the combination of events on the ground, attitude among voters and the success of Howard Dean in the early state is pulling the field toward a more critical position of President Bush. Only two of the nine candidates overtly supported the $87 billion aid request. So, what we're heading for is a clear and pointed referendum on the president's policy toward dealing with terrorism, specifically Iraq, in the presidential election regardless of almost who is nominated as the Democratic choice.
DOBBS: Today, Roger, General Wesley Clark came out and just blasted President Bush, saying that any failure in intelligence is all about a moot discussion, belongs squarely on his desk, he is the man responsible for any failure. These attacks are getting very, to say the least, animated and bitter.
ROGER SIMON, "U.S. NEWS AND WORLD REPORT": They are, and I agree with Ron in the reasoning behind them. It's Because Howard dean did so well with them early on. And the fact the Democratic feel has moved over to his side to become more shrill, to try to capture the same vote helps Dean enormously. Several months ago you read stories how this was an angry man, how he was isolated and shrill. Well, now if you watch all of the Democratic debates are all like Howard Dean. I mean, General Clark was supposed to be a more acceptable version of Dean. Yes, he was against the war, he was more moderate, he was a general and a different branch of the Democratic party could embrace him. Well, as we have seen, there's no difference between General Clark and Howard Dean on the subject of George Bush.
DOBBS: No difference they're neck and neck in the national polling yet Dean is running significantly, I mean very significantly, ahead in New Hampshire. Ron, can Clark or any of these other candidates catch up?
BROWNSTEIN: That is the real question, Lou. Look, you have to different race. A race in Iowa and New Hampshire where the people know who these candidates are, they're watching ads on television, they're meeting them, they're seeing them in their media. And then you have these national numbers which are a much more loosely formed impression. The fact is where people are paying attention, Howard Dean is running about even, slightly behind Dick Gephardt in Iowa, way ahead in New Hampshire and raising more money than any other Democratic candidates which is allowing him buy television advertising and begin organizing. And the next round of states in February where the others are phantom presences at this point. It's a challenge for the other Democrats to find a strategy to slow down Dean and to emerge as the one clear alternative. We know he has to take it to the finals.
The question who, if anyone, can consolidate enough support to stand against him before he can put this away?
DOBBS: Looming also in contention here amongst the Democrats is the specter of improvement in Iraq. Congressman Saxton says things are getting better, obviously there are terrible casualties to American forces, but in are positives occurring as well, real improvement. We heard from the Federal Reserve today that employment is picking up. Suggesting very positive things in the economy.
How important is that to any of these Democratic candidates in the primary season?
SIMON: Well, an improved economy certainly helps George Bush, there's no doubt about that. I don't think the Democrats are worried things are going to improve in Iraq by November of next year. And in fact, neither the president nor his defense secretary held out much hope that that would happened.
DOBBS: Right. I'm talking about really amongst the Democrats, does an improving economy, we understand that that will be good for the Bush administration, good for the Republicans.
But does it play in to the Democratic primary politics at all?
SIMON: Not as much as an in a general. Obviously jobs is the focus of Democrats in all elects and it's going to be a huge focus in this election. A jobless recovery...
DOBBS: I think it has the focus...
(CROSSTALK)
SIMON: ...something that the Democrats are going to attack.
DOBBS: I think those jobs have the focus of the Republicans as well, Roger.
Ron, we just have a few seconds. BROWNSTEIN: Very quickly, Lou, the reality is, no matter what the external conditions are, the Democratic electorate is overwhelmingly anti-Bush. In that poll you put out today, his approval rating among Republicans was 93 percent. It was 16 percent among Democrats.
That's the driving force in the Democratic race. It's not likely to change between now and then. There's a competition among candidates to see who can basically convince their partisans that they'll be the toughest warrior against the president the Democrats don't like very much.
DOBBS: Ron Brownstein, Roger Simon, gentlemen, thank you very much. Appreciate it.
Coming up next, "Leading Questions," our series of special reports in conjunction with "The Economist" magazine tonight. We focus on the celebrity CEO. Are those multimillion dollar salaries and star quality enough to ensure success? We'll give you a hint -- no.
Stay with us.
(COMMERCIAL BREAK)
DOBBS: Tonight, we begin a series of special reports in conjunction with "The Economist" magazine focusing on leadership. We'll be looking at what makes a great CEO, how leadership styles have changed over the years and how they influence the quality of your investments and the conduct of corporations.
Tonight, CEO salaries. CEO pay has grown exponentially, as you know, in recent years. CEO performance simply hasn't kept up.
(BEGIN VIDEOTAPE)
DOBBS (voice-over): Twenty years ago, the average CEO made 42 times more than the average employee. Today, the average CEO makes 400 times more.
BUD CRYSTAL, EXECUTIVE COMPENSATION EXPERT: If I extrapolated what's going on, by about the year 2025 or so, would approximate what it was in 1789, where Louis XVI was king of France. And you know what happened to Louis XVI. And, of course, they got his wife too.
DOBBS: Maybe Europeans CEOs have learned from history. Their salaries are often only a quarter of their American counterparts.
DEREK BOK, AUTHOR, "THE COST OF TALENT": In Scandinavia, compensation levels like that would be an absolute scandal. They couldn't possibly be sustained.
DOBBS: Americans are losing their confidence in and patience with CEOs. A poll last year revealed only 23 percent of Americans trusted the bosses of large corporations. They scored even lower than journalists. Still, CEO pay isn't coming down.
FRANCES CAIRNCROSS, "THE ECONOMIST": The job of the chief executive has become much tougher. You're watched far more closely. You're watched by the communications business. You're watched by analysts. There are higher expectations of you. Society watches chief executives more than it would have done 20 years ago. The markets react much more quickly, much more fiercely.
DOBBS: When was the concept of the star CEO paid out of proportion with all others born?
Former Harvard President Derek Bok studied the history.
BOK: After World War II, when American had perhaps its most remarkable period of sustained growth, compensation of CEOs actually went up less rapidly than the compensation of blue collar workers. Then suddenly, in the 1970s, the CEO compensation began to take off. Now why did that happen? The growth of television. But as a result, the salaries of athletes and popular entertainers began to grow enormously. And I think that was somewhat contagious.
UNIDENTIFIED MALE: The CEOs themselves are very fond of saying, Well, look at what Arnold Schwarzenegger makes for a movie. Or look at what the sports star makes. Look at what Luciano Pavarotti. The arguments are very flawed. Every person I just mentioned is an individual performer. People pay money to see them do whatever it is they do in a world-class way.
DOBBS: Even Hollywood's star system, with stunning salaries of up to $30 million a film, is still at least an efficient market.
DAVID WIRTSCHAFTER, EXEC. VICE PRESIDENT, WILLIAM MORRIS AGENCY: A movie star is judged ultimately by how many people buy the product, how many people go to the movies.
UNIDENTIFIED MALE: It's easier to quantify. The box office is kind of the ultimate arbiter.
CAIRNCROSS: With a Hollywood star you know if they've been worth the investment the day the movie opens. Now, the effect of a good chief executive may take several years to come through. You don't see it immediately and it's much, much harder to measure.
RAKESH KHURANA, ASSISTANT PROFESSOR, HARVARD BUSINESS SCHOOL: A CEO works it a company with tens of thousands of employees. And to simply attribute that company's performance to a single individual largely borders on irrational.
DOBBS: In fact, a recent Harvard Business School study found that over 20 years, CEO performance explained only 14 percent of overall firm profitability.
UNIDENTIFIED MALE: You know, the easy part of pay for performance is high pay for high performance. You know, CEOs absorb that in their mother's milk. They know how to do that. But the hard part is low pay for low performance. Well, we won't take very much of a raise. But perish the thought that you should actually cut your pay. I mean, that's for the little people.
DOBBS: But others still argue that CEOs today constantly face make-or-break decisions and failure is a one-way street.
CAIRNCROSS: Boards are much more trigger happy than they used to be. And much more willing to chuck out a chief executive after 18 months or two years. The trouble is if you lose your job, you're dead. And hardly anybody returns from the dead. Wall Street remembers failure.
UNIDENTIFIED MALE: The argument that they may not have as long a shelf life as they used to is probably true. It's the old song, "Don't Cry for me, Argentina." You know, I mean, I get fired, I come away with $50 million. I'm crying all the way to the bank, you know.
DOBBS: But Hollywood does have comebacks.
DAD HAYES, ASSISTANT MANAGING EDITOR, "VARIETY": What's interesting about Hollywood stars is that they just seem to have nine lives. A lot of them, you know, John Travolta and Tommy Lee Jones -- you don't get the sense of, you know, wanting to kind of penalize an actor or a star whereas there's been a lot of bitterness about CEOs because the sense is that there's a public trust aspect to it. There's a shareholder responsibility as aspect to it.
DOBBS: So while Hollywood's star system has produced much of what entertains us, America's economic future is a much more serious business.
KHURANA: I think the CEO star system was always broken. The idea of placing your faith in a single individual has proven false over and over again in all aspects of history. And I think we can look at the handful of great companies in which people do this.
They develop people internally. They allow ordinary people to do extraordinary things. Those are the kinds of CEOs we need. Those are the kinds of CEOs in which corporate America was built. Those are the kind of CEOs that we need to return to.
(END VIDEOTAPE)
DOBBS: And that's the kind of CEO we'll be focusing on here tomorrow. We look a the performance of one CEO who has lifted his company performance to new heights, and its stock price as well. Join us tomorrow night.
Coming up next -- a storm of heated gas and particles from the surface of the sun will hit the Earth by tomorrow. Astrophysicist Charles Liu of the Rose Center for Earth and Space at the American Museum of Natural History joins us to explain the likely impact. Stay with us.
(COMMERCIAL BREAK) DOBBS: One of the most powerful solar flares ever recorded erupted from a giant sun spot this morning, sending a storm of charged particles hurdling toward Earth. Forecasters say this blast is moving toward Earth at a rate of almost five million miles an hour. It is expected to hit by midday tomorrow.
My guest is Charles Liu, he's astrophysicist at the Museum of Natural History, professor of astrophysics at CUNY, and he always joins us for all affairs celestial and to help us understand issues that are so complex I can't even begin to grasp what's going on. So thanks for being here.
CHARLES LIU, ASTROPHYSICIST, AMERICAN MUSEUM OF NATURAL HISTORY: My pleasure.
DOBBS: This -- the sun spot, it sounds in many ways horrific, five million miles an hour, the third most powerful ever. How concerned should we be?
LIU: All I can say is don't panic.
DOBBS: OK, I promise.
LIU: It's actually not as fearful as it sounds. Although it is the third most powerful storm ever measured on the sun, based on its X-ray flux. By the time it gets to the surface of the Earth, where we are, we human beings are hardly affected at all.
DOBBS: How big is it?
LIU: Well, it comes from a sun spot. Its area is over 100 times the size of the Earth. So it's coming toward us pretty fast.
DOBBS: I'm moving toward panic now, Charles.
LIU: The thing is, only very large systems, such as, say, power grids or pipeline systems, electrical conducting systems will affect -- be affected in any significant way. Earth's magnetic field protects everything on the surface in almost all ways.
DOBBS: It just got hit last week by a moderate sized solar flare.
LIU: That's right, and nothing happened to us, right?
DOBBS: Does that have a lasting effect? Is there anything that happens from a frequency of being hit?
LIU: Usually, no. The 11-year cycle that the sun has in sun spots right now is sort of on its way down. We had a max called solar max in the year 2000-2001, and we often get hit many, many times in a week or a month during solar max with almost no effect.
DOBBS: You don't expect there to be a significant amount of electrical outages or power grid problems? I know I'm putting you on the spot... LIU: Not at all.
DOBBS: ... because frankly there's no way to judge these things before.
LIU: It's hard to predict. When we are predicting the powers of storms and so forth coming in. But I would say that to the extent that technology affects our lives it may cause us some problems. But on a day-to-day level, just go outside and look at the northern lights that are coming down. They may be visible as far south as Hawaii. And very beautiful.
DOBBS: And in the continental United States?
LIU: Yeah, all throughout. If the weather's clear, let's hope that works out really well.
DOBBS: I'm with you, Charles. And thank you for being with us.
LIU: Always a pleasure.
DOBBS: To guide us through this. Charles Liu, thank you.
Coming up next, your e-mails, including your thoughts on the massive influx of illegal aliens into this country and what corporate America should be doing to stop it. Stay it us.
(COMMERCIAL BREAK)
DOBBS: Well, that just about says it all.
Stocks rallied on Wall Street after the Fed left interest rates unchanged, and said the job market is showing signs of improvement. The Dow today gained 140 points, the Nasdaq up nearly 50. And the S&P 500 up more than 15.
Let's take a look at some of your thoughts now. From San Rafael, California: "Why not go after the companies that hire these illegals? They get off, but these illegals are shipped back. If the corporations refused to hire them, they would not come here looking for jobs as they would not exist." That from Wendy Murphy.
From Ft. Collins, Colorado: "Dear Lou, I admire your courage in covering our immigration issues. Ours is a multi-ethnic household, and we are continually amazed that people who stand up for immigration control are branded as racist. This year, our economy will create two million jobs, if we're lucky, yet legal plus illegal immigration will probably be over three million. How does that compute?" That from Kip Dunn.
And from White Lake, Michigan: "We appreciate your series on the Great American Giveaway, especially the report on the illegal immigrants taking American jobs. The assumption that American workers do not want these jobs is false. What Americans do want is a fair wage. Raise the wage and there will be plenty of takers." That from Kathleen Linck. From Delmont, Pennsylvania: "Very interesting. President Bush wants Syria and Iran to tighten up their borders, while he cannot control those he is responsible for." Interesting point, Dick Boley. Thanks for e-mailing us.
E-mail us at loudobbs@cnn.com. That's our show for tonight. Thanks for being with us. For all of us here, good night from New York. "ANDERSON COOPER 360" is next.
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Firefighters Battle Destructive Wildfires>
