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Lou Dobbs Tonight
President Bush Faces U.S. Steel Tariff Decision; French Diplomats Strike
Aired December 01, 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.
LOU DOBBS, CNN ANCHOR: Tonight: Army reservists stand up for their rights. Their officer stands up for his troops. And the Pentagon calls that insubordination.
On strike: Believe it or not, French diplomats work not only for their governments, but also for their unions. French diplomats around the world went on strike today, because the French government is unwilling to pay the high price of competing with U.S. foreign policy.
"America's Bright Future": our special report on the remarkable children and teenagers in this country with extraordinary talents and minds. Tonight, we bring you the story of a young inventor.
And in "Broken Borders," millions of illegal aliens in this country enjoying the benefits of citizenship, because our government is unwilling to enforce security at our borders. Tonight, we'll be joined by former Immigration and Naturalization Service Special Agent Michael Cutler.
ANNOUNCER: This is LOU DOBBS TONIGHT for Monday, December 1. Here now, Lou Dobbs.
DOBBS: Good evening.
Tonight: U.S. commanders say they will continue their aggressive tactics against insurgents and terrorists after the most ferocious battle in Iraq since the fall of Saddam Hussein. American soldiers guarding supply convoys killed as many as 54 Iraqis in a series of fierce engagements in Samarra, about 75 miles north of Baghdad. Five American troops were wounded in the battle. None suffered serious wounds. An American soldier was killed elsewhere in Iraq today, when his convoy was attacked west of Baghdad.
Walt Rodgers in Baghdad has the report -- Walt.
WALTER RODGERS, CNN SR. INTERNATIONAL CORRESPONDENT: Hello, Lou.
The U.S. Army does indeed confirm that the action in Samarra Sunday afternoon was the biggest combat action U.S. forces have seen since the declared end of the war last May. And this time, it was the Iraqi supporters loyal to Saddam Hussein who got badly mauled.
The estimates range between 46 to 54 Iraqi dead. Body counts are an imprecise science. Only five Americans were injured. And four of those Americans are now back serving with their units. Here is what happened. Two groups of Iraqi guerrillas, between 30 and 40 guerrillas in each group, set an ambush in Samarra, a town which is known for its loyalties to Saddam Hussein, set the ambush for two U.S. convoys, logistical and supply, bringing money to two banks up there.
Captain Andy Deponai was there.
(BEGIN VIDEO CLIP)
CAPT. ANDY DEPONAI, U.S. ARMY: We believe it was -- they split their force in half as well and had a well-planned attack against each bank site. And we think we're looking at anywhere from 30 to 40 individuals at each bank site. And they had broken themselves down into squad and team size elements, so they could attack each bank from all sides.
(END VIDEO CLIP)
RODGERS: One of the Iraqis' hiding places was a mosque. They were actually using a mosque to hide their RPGs and their automatic weapons. When the Americans came into view, they came charging out of that mosque.
The aim was clearly to kill Americans in this ambush, although the Iraqis may well have known that this was a bank transaction as well and may have been trying to rob the money, which was coming there. Clearly, the Americans overwhelmed the Iraqis with their firepower. The American tanks are built to withstand a nuclear battlefield in Europe. And, consequently, when the Iraqi insurgents came charging with their RPGs and guns, the tanks were impervious. That's why the Americans had a rout.
Still, the Iraqis in the town were quick to blame the Americans. Of course, you might perhaps expect that, because this is a town where one of the safest things you do is blame the Americans -- Lou.
DOBBS: Walt, the coordination of these attacks, culminating in a ferocious battle, does this suggest that U.S. intelligence continues to be a serious shortcoming?
RODGERS: I don't think so, Lou.
The U.S. intelligence was pretty spot on in this incident in Samarra. The Americans knew. They even sensed -- one of the soldiers said, when he didn't see many civilians on the street, he knew there was an ambush. Remember, the U.S. forces had brought money to that town four times in the last three weeks. Each of the times, they came in for small-arms fire.
So the Americans were not deceived. It wasn't really what you call a particularly embarrassing ambush for the Americans, because the Americans rolled into Samarra with four main battle tanks. And they had such firepower that it was the Iraqis themselves who made fools of themselves -- Lou.
DOBBS: Walt, thank you very much -- Walt Rodgers reporting from Baghdad. Troops involved in the battle of Samarra today said they were surprised by the scale of the insurgents' attacks. But U.S. commanders said the enemy is making a dreadful mistake if it believes it can defeat American troops equipped with tanks and Bradley Fighting Vehicles.
Our senior Pentagon correspondent, Jamie McIntyre, reports now on the changing tactics in this war in Iraq -- Jamie.
JAMIE MCINTYRE, CNN MILITARY AFFAIRS CORRESPONDENT: Well, Lou, as Walt Rodgers just noted, this was the most coordinated and largest attack since the end of major combat. But, from a strictly military standpoint, U.S. commanders say it was spectacularly unsuccessful.
(BEGIN VIDEO CLIP)
BRIG. GEN. MARK KIMMITT, U.S. DEPUTY CHIEF OF OPERATIONS: Any enemy that is looking at eight tanks, four Bradley Fighting Vehicles and 93 coalition soldiers and still decides to fight is making a dreadful mistake. So I wouldn't consider that sophisticated at all.
(END VIDEO CLIP)
MCINTYRE: Now, Pentagon officials say it does appear that the attackers clearly knew that the U.S. was coming to Samarra to provide two banks with the new Iraqi dinars.
The insurgents set up roadblocks and attacked from various angles simultaneously, using small-arms mortars and rocket-propelled grenades in the kind of maneuver tactics that are more conventional on the battlefield. Now, the U.S. says, if this represents a new enemy tactic, it is one that the U.S. is well equipped to handle.
(BEGIN VIDEO CLIP)
GEN. PETER PACE, VICE CHAIRMAN, JOINT CHIEFS OF STAFF: They attacked and they were killed. So I think it will be instructive to them for future analysis, when they're thinking about what they're going to do next.
(END VIDEO CLIP)
MCINTYRE: Now, fighting the U.S. on the battlefield using conventional tactics is a prescription for failure, according to military experts, and could also be a sign of desperation.
But, frankly, U.S. commanders are at a loss to explain why the Iraqi insurgents have may have challenged U.S. firepower this way. They may have been trying to make a bold statement and simply miscalculated how well protected that convoy was. Nobody here seems to believe that this was actually an attempt to steal the money that was being delivered to the banks. As one Pentagon official said, this was not a bank heist that went awry -- Lou.
DOBBS: Jamie, thank you very much -- Jamie McIntyre, our senior Pentagon correspondent. The United States has too few regular Army units to carry out its considerable numbers of missions around the world. While the Pentagon has been innovative, creative and, to this point, successful, in managing this country's war-fighting resources, an unusually heavy burden and some would say unfair burden has fallen upon reservists and the National Guard.
Army reservists in upstate New York are being asked to sign a waiver that would clear the way for them to be deployed overseas again. This would be the second deployment for the 401st Civil Affairs Battalion in a year. By law, reservists receive 12 months downtime between overseas deployments unless they waive that right. Some reservists at the 401st are unwilling to sign that waiver.
Deborah Feyerick joins us now outside Rochester, New York -- Deborah.
DEBORAH FEYERICK, CNN CORRESPONDENT: Well, Lou, that's the big question. The Army has a policy for reservists that, if they do spend a year in combat, that they're entitled to come home for at least a year. But because of the shortage, a number of these soldiers are being asked to sign these waivers. There has been a lot of confusion among the soldiers. They've been seeking out their commanding officers to find out, do they have to sign these waivers and go back if they don't want to go back?
(BEGIN VIDEO CLIP)
CHRIS DRITSCHEL, U.S. ARMY SPECIALIST: I feel I already signed the contract saying I'm going to be in the Army for this amount of time. And I shouldn't have to sign anything else saying, well, I'm going to volunteer for this. I don't have to go. I don't see any reason why I should have to go if I've been there once already.
(END VIDEO CLIP)
FEYERICK: Now, Christopher Dritschel is one of those people who signed the waiver. But then he tore it up, saying that, if he didn't have to go, he wasn't going to go. Dritschel's bags are packed. He's been ordered to show up at Fort Bragg.
However, he is concerned that he will have to go without getting the proper amount of rest he can. One of his officers, a man by the name of Captain Steven McAlpin, stood up for his soldiers. But the Army called this insubordination. They kicked him out of the reserves.
(BEGIN VIDEO CLIP)
CAPT. STEVE MCALPIN, U.S. ARMY RESERVE: They're asking these soldiers to go up and beyond, when, legally, they're entitled to some rights of a stabilization period following a deployment.
(END VIDEO CLIP)
FEYERICK: Now, the soldiers can go back whenever the Army calls them up. They have tried to be considerate to make sure that the soldiers get the proper amount of rest.
But this is causing confusion within the ranks of the soldiers, because they don't know, can they go back? Do they have to go back? Should they go back? But it looks like they are going to go back once the New Year's comes -- Lou.
DOBBS: Deborah, thank you very much -- Deborah Feyerick reporting from Rochester, New York.
For more now on this issue and the strains facing our Army reservists and National Guard, I'm joined by General David Grange.
Good to have you with us, Dave.
RETIRED BRIG. GEN. DAVID GRANGE, CNN MILITARY ANALYST: Thank you, Lou.
DOBBS: This issue in particular -- let's start with Captain McAlpin, standing up, it appears, for his troops in this case. How would you react to that situation? To be thrown out of the reservists, a 25-year veteran, that seems remarkably severe.
GRANGE: Well, there is nothing wrong. And, in fact, it is duty of any commander to stand up for his troops, his or her troops, in any situation that they have a gripe. And I guess the captain did that.
The issue is, was he insubordinate to his chain of command? And that's for the Uniform Code of Military Justice to determine. It is an issue that is brought up, but it is tied to this bigger issue of understanding the law, the policies of mobilization.
DOBBS: Well, let's talk about the -- we saw the young -- the young soldier talking about the waiver. And these waivers are obviously affecting the entire unit and one presumes a reservist well beyond the 401st. Why, first, is the waiver necessary?
GRANGE: Well, I think there may be a little bit of a misunderstanding here as well with the unit.
And that is that, right now, the United States of America, the armed forces, are under what is known as partial mobilization. That gives the president the right to mobilize up to a million reservists for 24 months of time. And that is 24 months of mobilization time. Now, the policy of Department of Defense is to give soldiers a year break after a year of duty overseas, or even if it is the duties in the United States of America, but a year break back in their civilian status.
DOBBS: Right.
GRANGE: But it is a policy. It is not bound by law.
So, if they ask for a waiver, it is -- I'm not sure why they would ask for a waiver under 24 months.
DOBBS: General, why would the 401st be redeployed for a third time, not a second time, here?
GRANGE: Well, this is, again, one of the bigger issues involved, bigger than Captain McAlpin or others. And that is that, for instance, he's in a civil affairs unit.
The civil affairs are mainly made up of reservists, not active forces. And I think it is 96 percent of the civil affairs troops in the United States Army are in the reserves. So it's a high-use, but low-number unit. And these type of missions in Afghanistan and in Iraq require a lot of civil affairs troops, which the military is very short of.
DOBBS: There is also talk that the unit will be deployed to Fort Bragg for training, even if it isn't redeployed. This smacks of, if you will, retaliation in some ways.
GRANGE: Well, I hope it is not retaliation. I hope that what is happening is that the chain of command, the commanders of this unit, are going to Fort Bragg to train for readiness, if in fact they are deployed, because that eats up a lot of preparation time before they move the units overseas.
DOBBS: General, in point of fact, this strain that we're seeing put upon our reserves, upon our National Guard, it really goes fundamentally to the issue. Despite what this Pentagon and this secretary of defense has been maintaining for some time, we simply don't have enough regular Army to carry out the missions that have been imposed upon our young men and women in uniform all around the world, in addition to Iraq and Afghanistan.
GRANGE: That's exactly right. The military is too small for the task at hand. And what happens is, and another two or three second-, third-order effects will reach probably a culminating point of a crisis on shortages of troops.
DOBBS: General David Grange, thank you very much.
GRANGE: My pleasure.
DOBBS: Coming up next: The president steels himself for reaction to a massive rollback of a controversial tariff. Lisa Sylvester and White House correspondent Suzanne Malveaux report.
And then, in our special report tonight, "Broken Borders," a former INS special agent says this country does far too little to keep illegal aliens from crossing our borders. Michael Cutler joins us.
And "America's Bright Future," our series of special reports on this country's most promising young minds and talents, continues tonight -- an inventor who succeeded where the experts said he would fail. Bill Tucker will have his story.
(COMMERCIAL BREAK)
DOBBS: Thousands of French diplomats all around the world went on strike today, but the rest of the globe seemed to hardly notice. The diplomats stopped work for the day to protest budget cuts by the French Foreign Ministry. Unions -- yes, the French diplomats have unions -- say those cuts undermine President Chirac's goal of increasing France's global influence.
(BEGIN VIDEO CLIP)
LIONEL RUELLAN, STRIKING DIPLOMAT: We can't carry on like this. We need to change the policy. We need to stop reducing the employees over the world and try to make a living and represent France overseas, basically, in proper ways.
(END VIDEO CLIP)
DOBBS: Some critics might say that France has very little influence anyway and its leaders should stop pretending, for the benefit of their diplomats around the world, that France is once again a world power.
Diplomats on both sides of the Atlantic have been busy discussing U.S. steel tariffs, those tariffs introduced and imposed by President Bush 18 months ago to protect the U.S. steel industry from foreign competition. Tonight, however, President Bush appears ready to back down from the tariffs, a decision that could have important political consequences in this country.
Lisa Sylvester reports from Washington.
(BEGIN VIDEOTAPE)
LISA SYLVESTER, CNN CORRESPONDENT (voice-over): President Bush, visiting workers in Canton, Michigan, says he wants to protect American jobs and to keep U.S. markets open. But the two goals are not always mutually compatible. Steel producers say a decision to lift tariffs would hurt the industry just as it is getting back on its feet.
DAN DIMICCO, CEO, NUCOR STEEL: Only one third of what was needed to be done has been done. The acquisitions have started. The consolidations have started. It takes years to put through the transition, so you can achieve the benefits of that consolidation.
SYLVESTER: In March of 2002, the White House instituted tariffs on foreign steel to help the beleaguered American steel industry. But the World Trade Organization ruled last month, the tariffs violate international trade laws.
The European Union, Japan, South Korea and China threatened to block U.S. exports on numerous goods, including Harley-Davidson motorcycles, citrus products and textiles, if the United States did not reverse course. That could have sparked an all-out trade war.
ANDY LAPERRIERE, INTERNATIONAL STRATEGY & INVESTMENT: I think it would be economically and politically costly to have a trade war. It would be negative for financial markets. It would be negative for the economy. And I think it would be negative politically. SYLVESTER: The states who stand to benefit from the repeal, Florida and Washington state -- citrus and apple growers were worried about a loss of exports -- and Michigan. Automakers had been complaining they had to pay more for American steel. The administration may try to argue, it tried to keep protections in place as long it could.
BRINK LINDSEY, CATO INSTITUTE: They can say they did something for the steel industry. And now they can turn around to downstream industry, since we have cut them off early for your sake as well.
SYLVESTER: But lifting tariffs carries a political price tag with voters in steel-producing states, Pennsylvania, West Virginia and Ohio, key swing states.
(END VIDEOTAPE)
SYLVESTER: Lou, tomorrow, President Bush will face some of his toughest critics on this issue. He has a fund-raiser in Pittsburgh at the headquarters of the U.S. Steel Corporation -- Lou.
DOBBS: Not the best of timing, perhaps.
(LAUGHTER)
SYLVESTER: Not at all, Lou. It's going to be a tough visit for President Bush.
DOBBS: Lisa Sylvester, Thank you very much.
The White House believes the president can lift the steel tariffs without suffering major political damage, however. President Bush is likely to use some votes in steel-producing states, but he will probably win support in those states that have suffered from higher steel prices.
White House correspondent Suzanne Malveaux, traveling with the president tonight, joining us from Newark, New Jersey -- Suzanne.
SUZANNE MALVEAUX, CNN CORRESPONDENT: Well, Lou, a White House spokesman says the president has not made a decision yet, that they're still in consultations.
But administration sources telling us it is all but a done deal to lift those tariffs. Of course, that would have huge economic and political implications for the president. Just take Michigan, one of those battleground states. This is where the president was earlier at a small manufacturing plant. It would work in his favor. You know that Michigan -- he lost Michigan in 2000. But this is where, of course, factories and auto plants they say have been hurt by the tariffs.
It is also a place where his conservative base, they say that they're staunch advocates of free trade and they believe that President Bush abandoned their cause.
President Bush, earlier today, touching on that issue.
(BEGIN VIDEO CLIP)
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: We got some of greatest entrepreneurs in America. And, therefore, it seems like to make sense to me that we ought to be opening up markets for us to sell our goods. But the other thing I want you to understand is, we're going make sure it is fair. We want the playing field to be level, so we can compete in a fair way.
(END VIDEO CLIP)
MALVEAUX: Of course, lifting these tariffs could hurt him as well in those key battleground states. We're talking about West Virginia, as well as Ohio, as well as Pennsylvania, those steel- producing states.
But, of course, the political calculus here, Lou, is that they know that these possible sanctions with E.U., Japan, China and others hitting those products that are in states that are critical to a Bush reelection, talking about Florida oranges, Ohio motorcycles, other goods, they figure that it really is in their interests and their best interests to lift these tariffs, that it would be better overall for the economy, that the Bush administration could take the hit and they'll focus on that manufacturing sector and building those jobs -- Lou.
DOBBS: We'll see how that calculation works, Suzanne.
The president is talking fair trade. It is interesting to hear him using that expression, because this administration has been pushing free trade, as you well know, since inauguration day. This marks, does it not, a significant change in at least tone, tenor, if not policy.
MALVEAUX: Of course.
And, also, he has been talking about free trade and fair trade. It is one of those ways that he has been saying, in kind of a roundabout way, that he believes, of course, that, yes, this tariff was in place for a good reason, that, yes, they needed to protect the American steel industry within a three-year period. They may have to settle for 20 months.
DOBBS: Suzanne Malveaux, reporting from New Jersey, thank you very much.
Later here, I'll be talking about these steel tariffs, the likely lifting of those tariffs by the president and its effect on the steel industry. I'll be talking with Wilbur Ross. He is chairman of the International Steep Group, one of the most successful restructuring financiers in the country who has quite a few things to say about free and fair trade.
That brings us to the subject of tonight's poll. The question: Do you think ending tariffs on imported steel is unfair to U.S. steelworkers, yes or no? Cast your vote at CNN.com/Lou. We'll have the results later here.
When we continue, "Broken Borders" -- tonight, two disturbing reports on how government agencies have failed the American public at our borders. Kitty Pilgrim will report. And Michael Cutler, former senior special agent with the Immigration and Naturalization Service, joins us.
And "America's Bright Future" -- tonight, a teenage inventor who found a way to fight disease and deadly infection, when older minds said it couldn't be done. Bill Tucker will have the story.
(COMMERCIAL BREAK)
DOBBS: The Department of Homeland Security tomorrow will end a program to track potential terrorists in this country. That program, which requires men and boys from 25 Middle Eastern countries living in the United States to register with the government, was put into place following the terrorist attacks of September 11. A new program to track foreigners is expected to begin January 5.
Tonight, "Broken Borders" -- not only do more than 1,000 illegal aliens enter this country each and every day, but programs to inspect imported food are, at best, random. The Food and Drug Administration has now linked four companies in Mexico to the hepatitis outbreak in four states that killed three people and sickened more than 600 others. The FDA is now investigating in Mexico whether those plants are owned by American companies and whether they fail to meet the U.S. safety standards.
Kitty Pilgrim reports.
(BEGIN VIDEOTAPE)
KITTY PILGRIM, CNN CORRESPONDENT (voice-over): Mexico's still exports green onions to this country, but not by the four Mexican firms tied to the hepatitis A outbreak. A four-person team from the FDA and the CDC are inspecting operations in Mexican farms, from packing sheds to the water supply. The FDA does not normally do on- site inspections, except in the case of outbreaks. Activists say that needs to change.
CAROLINE SMITH DEWAAL, FOOD SAFETY DIRECTOR, CENTER FOR SCIENCE IN THE PUBLIC INTEREST: And they should be checking for things like the health conditions, the sanitation conditions, and whether the farms in fact have clean water. These kinds of checks should be standard for produce coming to the U.S. and not just used when there is a public health emergency.
PILGRIM: Back in 20001 and 2002, the FDA banned cantaloupes from Mexico after a salmonella outbreak. Controls were tightened. And only just now, after the Mexican government began a certification program, are Mexican cantaloupes being allowed back into the country again.
Back in 1997, strawberries from Mexico caused a hepatitis outbreak. No new cases have been reported since November 21. And the current outbreak seems to be contained. But 615 people were stricken with hepatitis A after eating at a Chi-Chi's restaurant near Pittsburgh. Three died.
Victims of the outbreaks are suing four American distributors or suppliers of the onions, Castellini Company of Kentucky, NewStar Fresh Food of California, Apio Fresh LLC of California, and Boskovich Farms of California.
(END VIDEOTAPE)
PILGRIM: One of the distributors, Apio Fresh, told us today they voluntarily asked their customers to pull all green onions off the market. They also suspended shipments from Mexico -- Lou.
DOBBS: Kitty, thank you very much -- Kitty Pilgrim.
We have been reporting here for months on how our broken borders have allowed an estimated 10 million illegal aliens to enter and reside in this country. They are now enjoying many of the benefits of citizenship, including education, free health care and, of course, employment.
My guest tonight has for decades been at the forefront of the fight against illegal immigration. Michael Cutler spent 30 years at the Immigration and Naturalization Service, retiring last year as senior special agent.
Good to have you with us, Michael.
MICHAEL CUTLER, FORMER SENIOR INS AGENT: Thank you. Good to be here.
DOBBS: The question cries out. And our viewers write in almost daily. What is it about illegal that American policy-makers don't quite understand?
CUTLER: Well, they don't seem to understand the word illegal. And we also seem to have a problem with the word alien. All too often, I see where journalists will refer to aliens who are illegally in the United States as undocumented workers, undocumented immigrants.
(CROSSTALK)
DOBBS: Where did that start, the idea of saying undocumented...
CUTLER: It actually started with President Jimmy Carter. A memo came out that was disseminated to all field agents and all personnel that, if we used the term illegal alien, that they would actually discipline us.
They wanted to change the mind-set. It reminded me of "1984," the idea of newspeak. We're going to change the words. We'll change the vernacular. And, consequently, we'll change the thought processes.
DOBBS: Political correctness... CUTLER: Absolutely.
DOBBS: ... its incipient stage.
CUTLER: Well, I believe that was the first example of political correctness.
DOBBS: Well, it also -- well, we can go back to 1971 "incursions" on the part of Nixon administration instead of "invasions" and "bombing attacks."
CUTLER: That's correct.
DOBBS: It's a time honored device, I think, of government, whether Democratic or totalitarian.
CUTLER: Well, bureaucracies do it all the time.
DOBBS: Absolutely.
The bureaucracy that was the INS, that is now homeland security and ICE, the thousands of border patrol agents, the men and women who are charged with securing our borders, how must they feel?
There is no will, apparently, on the part of other our policymakers or this administration or the administration's previous to enforce security at the borders, yet that is their charge. How -- What is their morale? What is their attitude?
CUTLER: Well, I always joke that there can be no problem with something that doesn't exist. If there is no morale, then, you know -- but the problem is it's not just the border patrol.
Half of the illegal aliens currently living inside our country today didn't run the border. They were admitted through ports of entry by our inspectors, as did the 19 terrorists who wreaked havoc on us.
So the bottom line is, what we need to understand is that immigration and law enforcement has to stand on three legs. We hear about the border patrol. We're aware of inspectors, but the third leg that keeps on getting neglected and ignored is interior enforcement that the special agents do.
DOBBS: And the terrorists of September 11, it's always important to note there was a crossing at the Canadian border, not the Mexican border.
It's -- often people look at it, when we talk about broken borders, we purposely make that plural.
CUTLER: Right.
DOBBS: It's not just the southern border. It's also the northern border.
CUTLER: And it's also the borders that exist at ports of entry, airports.
DOBBS: Absolutely.
CUTLER: And that's something that we keep neglecting.
DOBBS: The decision today to eliminate the program requiring the registration of young men and boys from 25 Middle Eastern countries and to put it aside and not worry about it until the 5th of January, when a new program will be introduced, what do we do with that two- month -- approximately two-month gap there?
CUTLER: Pray to God that nobody else falls through the cracks. And that's part of what the problem is.
You know, we also have 27 countries right now where their citizens are exempt the requirement of getting visas before they come to the United States. So we really don't even know who were admitted. We're allowing that system to rest on a name on a passport and nothing more than that.
DOBBS: Michael, with your experience, and with all you have seen and experienced, what's the solution?
CUTLER: We've got to change the Philosophy. We need more agents, more resources. We need the support of both political parties. They've got to stop politicizing this process. Democrats are looking for voters, and the Republicans are looking for cheap labor. And we're caught in the middle.
DOBBS: And I think you just said it. Well, the American people are caught in the middle. It's time something was done about it.
CUTLER: Absolutely.
DOBBS: I hope you'll come back soon as we explore this issue in the months ahead.
CUTLER: I welcome the opportunity. And I thank you for having me.
DOBBS: Thank you, Michael Cutler.
Let's take a look at some of your thoughts tonight.
From Miami, Florida: "Lou, I just want to thank you for your continuing coverage regarding the outsourcing of tech jobs and to shed light on one of the most important topics of all: the economy. What's happening with our country that we're so eager to give it away in a hand basket?"
On "Broken Borders," from Port Orange, Florida: "Lou, since you speak so eloquently about the illegals, why not stress the fact that we are not safe from terrorists since they can simply walk across our open borders. If the terrorists did come over the borders, who in the heck would know? Certainly not Homeland Security." And from Austin, Indiana: "I'm a senior, American citizen, and it is sad that we, as senior citizens, must choose to buy medicine or food when illegal immigrants are assured both when they enter the United States of America."
And from Tucson, Arizona: "Dear Lou, thank you for standing up against the illegals that come across our borders and cost us millions each year. I live in Tucson and have watched our hospital bills escalate to take care of them when so many of our Americans can't afford insurance to take care of their families. Our jail costs are unbelievable, let alone what it costs us to let them go to school for nothing. Our government is nuts to let that go on. If people want to come to the U.S., make them do it legally. I don't have a problem with that."
We love hearing from you. E-mail us at LouDobbs@CNN.com.
Coming up next here, turmoil inside two of the country's best- known biggest companies. Christine Romans will have the story.
And outgoing Boeing chairman and CEO Phil Condit and the man who will replace him join me.
Stay with us.
(COMMERCIAL BREAK)
DOBBS: Another rally on the market today, lifting the NASDAQ to its highest level in almost two years. And major shake-ups today in the leaderships of two of big American companies.
Christine Romans is here with all of that for us -- Christine.
CHRISTINE ROMANS, CNN CORRESPONDENT: On the first day of what is historically the best month for stocks, an 18-month high for the Dow and for the S&P 500.
Worried that stocks have rallied too far too fast? Sam Stowbah (ph) at S&P said don't. The S&P 500 up 34 percent, less than the average first year of a bull market. He said it would probably go a little further next year.
Now, on to the board room drama of the day. Roy Disney resigned from the board of Walt Disney, and Lou, he didn't go quietly.
He said Michael Eisner was the one who should go, because under his watch, Disney has suffered a creative brain drain, low morale because of micromanagement and poor performance.
Then board member Stanley Gold resigned, also calling for Eisner's ouster and decrying improvements in corporate government as image over substance.
Disney's board, once voted the worst in corporate American, was voted last year most improved by "Business Week," but critics argue Eisner has a "my company, my board" mentality. Until Disney replaces its board, it will continue to have those problems, many of those experts say.
Now, the tale of Boeing's CEO departure today is much different. Corporate governance experts say that the buck stops with the CEO, and Phil Condit stepped up to recent controversy.
Last week, Condit's No. 2 was ousted for improperly hiring an Air Force official. Louis Platt was named nonexecutive chairman and Harry Stonecipher takes the CEO mantle immediately, splitting Condit's job.
One ethics professor told me that there are some straight shooters on the Boeing board and that that might be a good direction for this company as it goes forward.
DOBBS: Well, Boeing's board, independent. We'll be talking with Phil Condit, the outgoing CEO and Stonecipher, the replacement here. But it's an interesting dichotomy. Disney's board and Boeing's, stepping up, insisting on accountability in one case and the other not.
ROMANS: Eisner stays and Condit goes.
DOBBS: Christine Romans, thank you.
Talk radio and conservatism, two entities long thought to be interchangeable. But a group of liberal investors say they're about to change all of that.
The newly formed Progress Media says it will buy radio stations in New York, Los Angeles, San Francisco, Philadelphia and Boston. They'll counter Rush Limbaugh. And the comedian Al Franken and actress Janeane Garofalo, they'll be the primary talent, apparently.
The new network plans to be up and running by next spring, just as the presidential campaign goes into high gear.
In Hollywood, political activists will gather for a so-called "Hate Bush" event tomorrow evening in Beverly Hills.
The wife of Seinfeld director and creator Harry David sent invitations to actresses Julia Louis-Dreyfus and Heather Thomas, among others. Its purpose, to prevent the, quote, "advancement of the current extremist right-wing agenda," end quote.
The new Iowa poll shows Howard Dean retaking the lead in Iowa from Dick Gephardt. WHO-TV in Des Moines found likely caucus goers supporting Dean over Gephardt by 10 points. Gephardt previously enjoyed a 17-point lead.
Tonight's quote is from another Democratic candidate for president on what is perhaps the most important issue now facing the economy, the defense of American jobs.
And we quote, "I'd like to see something that we haven't seen in this country among a lot of people, and that is economic patriotism. Let's have some commitment to do what's right for the American economy, for American workers, for American businesses. That's something the law can't require, but any American who cares about our country ought to be supporting."
That from Senator Joseph Lieberman of Connecticut.
Coming up next, a rollback of the steel tariffs will have a widespread effect on a number of industries and workers in this country. Wilbur Ross, the chairman of the International Steel Group, joins us to talk about why he thinks tariffs have succeeded and should be kept in place.
Stay with us.
(COMMERCIAL BREAK)
DOBBS: My next guest says the president was right to put those tariffs on imported steel and that if he's going to lift them, something else has to be done to protect the steel industry.
Wilbur Ross, chairman of the International Steel Group and chairman and CEO of W.L. Ross and Company joins me now.
Good to have you here, Wilbur.
WILBUR ROSS, CHAIRMAN, INTERNATIONAL STEEL GROUP: Thank you, Lou. Good to be here again.
DOBBS: The president, was he trying to avoid a trade war? Was it that simple?
ROSS: I think it's more complicated than that. But certainly what Laami (ph) did with saying he would put in tariffs on very innocent industries that have nothing to do with steel really is direct meddling in the U.S. presidential election. Imagine how angry the French would be if Bush did something like that in their election.
DOBBS: And since we buy far more of their products than they do from us, you might ask who the heck cares?
ROSS: Oh, yes. In fact, half of the total deficit that we have in trade is with Europe, Japan and Canada, three high cost countries, because they play games. It isn't because they're inherently lower costs.
DOBBS: And it looks like the administration may, in point of fact, allow them to play games. What can the president do? He's caught in a difficult political as well as economic situation.
ROSS: Yes.
DOBBS: What can he do to protect us?
ROSS: I think there are a number of things.
First of all, the 201 procedure, which is the one that led us to the steel tariffs, where the ITC found in the industry's favor, is a long and expensive process. Streamlining that in some way, so that if there is more dumping later, we can deal with it quickly, would be a very big help.
DOBBS: You know, a lot of people say, you know, U.S. steel producers simply don't want to compete on productivity with European steel makers, with Asian steel makers.
ROSS: The fact is we are more productive than they are. Our company takes less than one man hour to make a ton of steel. The Europeans average 2.6. The Chinese average 6.
DOBBS: The position being, then, that they're dumping. And the American steel worker, there are now 150,000 people who have their jobs invested in that industry. Can those jobs survive?
ROSS: They can, if the continuity lets the industry continue to restructure. We pretty much have done what we need do. We have 31 steel companies in bankruptcy with around 35,000 active employees and 100,000 retirees who will be left with no health benefits if those companies go down the drain.
DOBBS: You believe this president, this Congress will keep those -- maintain a commitment to those companies and those workers?
ROSS: I don't know about to those workers. I think he will do something to help the steel industry, and I think he's becoming much more conscious of the problem. I like him saying "fair trade"...
DOBBS: Yes, we heard that today for the first time.
ROSS: ... instead of just "free trade". New rhetoric. New rhetoric.
DOBBS: Hopefully, there will be some meaning behind it. But you can't always bank on that in Washington.
ROSS: No. But at least rhetoric may be a start.
DOBBS: There you go. Wilbur Ross, good to have you with us. Thank you.
ROSS: Thank you. Good to be on.
DOBBS: When we continue, a shake-up at the top of the world's largest aerospace company. Outgoing chairman/CEO of Boeing, Phil Condit, and his successor, Harry Stonecipher, will join me next.
Stay with us.
(COMMERCIAL BREAK)
DOBBS: I'm joined now by the past and future leaders of the country's leading aerospace company.
Phil Condit today resigned under pressure from his board as the CEO and co-chairman of his company. Condit said he wanted to put the distractions and controversies of the past year behind Boeing and instead put focus on performance. Harry Stonecipher, named Boeing's new CEO and president. Stonecipher retired last year after serving as vice chairman, president and chief operating officer. Both join us tonight from Boeing headquarters in Chicago.
Good to have you both here.
HARRY STONECIPHER, NEW BOEING CEO: Thank you.
PHIL CONDIT, OUTGOING BOEING CEO: Thank you, Lou.
DOBBS: A difficult day, I know, for you, Phil. And a difficult charge for you, Harry, as you look to the future of the company.
Let me start, Phil, the controversies that have embroiled Boeing, starting with the tanker controversy, the leases, the firing of your CFO last week, charges of inappropriate conduct, unethical conduct in two other cases, principle cases.
How did you get to this point, Phil?
CONDIT: Well, one of the things I really want is I want this company to succeed. And what I saw was unless we did something, took some pretty dramatic action, the focus was going to be on these issues.
The rest of the company is running superbly. We've got great programs, they're doing great things, but the distractions were taking away from that.
I said to the board, "Look, if it's going to make this company better, and more successful, I'd be willing to step away and make a change if we can take it forward."
They talked about it a lot. And they ended up saying, "OK, that's what we'll do." That's what we did.
DOBBS: Phil, straight up, this was your idea. You weren't forced out by your board of directors?
CONDIT: Absolutely straight up. This was me leading with that statement, the board talking about it, reaching a decision and I had exactly zero pressure to do that. Nobody even said to me, "Would you consider it?"
DOBBS: Mike Sears and Darleen Druyun using inside information, is the allegation, to win contracts. The issue of the tanker contracts, these represent ethical breeches that one doesn't associate with Boeing.
You have an independent board of directors, you have a clear-cut governance policy, and yet this and more happened under your watch. How did it happen?
CONDIT: Well, first, let's deal with what the allegations are and what we found in our investigation. What we found was that Mike talked to Darleen about potential employment, ahead of when she recused herself. We found no evidence whatsoever that any information was exchanged or anything was granted. It was just that conversation.
The real issue for us was that it didn't come out until we dug into it. So we don't think there was anything gained by Boeing in that process. But we also felt we had to act and did.
DOBBS: Harry, is it your -- if I may turn to Harry Stonecipher now, the man who's going to have to carry the mantle forward, you were there during many of the allegations as chief operating officer, going back to the Raytheon deal, to a number of the other issues.
Harry, what do you do here? Phil turning in his resignation, stepping aside, is that -- because many people will suggest it -- to blunt the investigations and the hearings on Congress that sure to follow all that has transpired at Boeing this year?
STONECIPHER: Well, I think we have to go ahead and answer all the allegations, continue the investigation. And we have good policies and procedures. And as you mentioned, this is a very ethical company with great integrity.
And when people violate those policies and procedures, then you have to deal with it. And in fact we did. And we did when it happened. Unfortunately, some of the investigations were flawed and brought about some further allegations.
So we're going to have to be sure that we answer all the questions. All of the questions for everyone.
DOBBS: And how long do you think it's going to take for you to come to a conclusion on a number that -- I mean, you've got the satellite division; you've got the commercial aircraft division; you've got military procurement; you've got these other issues. I mean, this is -- it's a short word. It's a mess.
STONECIPHER: My -- it's not a mess. We've got a lot of great people doing a lot of great things. And...
DOBBS: Well, if you don't -- Harry, if you don't call that a mess, I don't know what you would call a mess.
STONECIPHER: It's the concentration of right now, let's get the tanker program straightened out. The commercial guys have been doing a great job. And they're going to bring forward to the board this month a brand new airplane for us to consider. And I'll be concentrating on the problems in the defense area.
DOBBS: And, Harry, Phil has built a reputation in this country as an ethical and effective executive, your board is independent. You have separated the chairman and the CEO function.
Do you have further plans in mind? Are you going to look for another CEO? Is there a search under way? STONECIPHER: There is no search underway, as there's -- the board has a succession process that it continually looks at and has. And I'm sure that in due course down the road they will decide that Harry Stonecipher has been here long enough. If I'm performing, it will be a little longer than it will be if I'm not performing. So we'll...
DOBBS: But you plan on being there for a considerable period of time?
STONECIPHER: Absolutely. As I -- I was pleased to work beside Phil, implementing the strategy that he define, and I'm happy to be the one that will go forward and try to implement his vision.
DOBBS: Now the execution. Harry Stonecipher, CEO of Boeing, Phil Condit, former CEO. Gentlemen, we thank you both for being here.
CONDIT: Thank you.
STONECIPHER: Thank you, Lou.
DOBBS: Coming up next, "America's Bright Future," our series of special reports on some of the remarkable young people who together make this nation's future loom so brightly.
And tonight, the experts said it couldn't be done. But one young man found a solution to a difficult problem that older minds said it couldn't be done. That's next.
(COMMERCIAL BREAK)
DOBBS: Well, 57 percent of you said yes to the question, "Do you think ending tariffs is unfair to U.S. steel workers?" Forty-three percent said no.
Tonight, a young man who caught the attention of the scientific community at the age of 15. Bill Tucker has his story.
(BEGIN VIDEOTAPE)
BILL TUCKER, CNN CORRESPONDENT (voice-over): They are the menace of summer, spreading malaria, yellow fever, encephalitis and West Nile Virus. And thanks to this young man, a new sonic weapon has been added to the arsenal against mosquitoes.
MICHAEL NYBERG, INVENTED MOSQUITO CONTROL MACHINE: When I put the sound into the water, these air bladders will resonate. And they vibrate so much that they'll explode from the tissue that's holding them in. And without these air bladders, they'll essentially suffocate.
TUCKER: Michael Nyberg was only 15 when he made his discovery, and that's after he was told it would not work. Amazingly, his machine kills only mosquito larva and harms nothing else, meaning that it can be used where spraying and pesticides are prohibited. JOSEPH CONLON, MOSQUITO CONTROL ASSN: This was absolutely out of the blue, which is quite remarkable and, again, quite welcome for someone thinking outside the box, so to speak, to thinking beyond standard and normal mosquito control procedures.
TUCKER: Not content to just stop at the idea, Michael and his father started a business, New Mountain Innovations. The business remains small because they focused on selling mainly to health departments.
NYBERG: So far I see it fairly successful. I mean, we've taken this idea. We built the first unit is a storm drain unit. And we built that two years ago and started selling it, and it's grown in popularity this year.
TUCKER: This winter, Mike and his dad will unveil a unit that will work in marshlands, which they hope will open up a consumer market. Not bad for a guy that's just a freshman at Clarkson University in upstate New York, where he's studying engineering.
Michael is an Eagle Scout, a member of his school's Air Force ROTC, and Michael is a young man with his eyes set on the future.
NYBERG: My future? I hope that after -- well, after working in the Air Force, I hope to work with NASA in their space program but also work with the New Mountain Innovations.
The new frontier. It's just the idea of going out there in space, in a totally different world, and it's nothing like you've probably been on, nothing you can experience on earth.
TUCKER: So what's next for Michael? He's turning his focus to water.
(END VIDEOTAPE)
TUCKER: Michael's noticed that there's literally water everywhere, but Lou, only three percent of the available water can be used.
DOBBS: And Michael's on the case.
TUCKER: He is.
DOBBS: Remarkable young man. Thank you very much, Bill Tucker.
That's our show for tonight. We thank you for being with us. For all of us here, good night from New York City.
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Diplomats Strike>
Aired December 1, 2003 - 18:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
LOU DOBBS, CNN ANCHOR: Tonight: Army reservists stand up for their rights. Their officer stands up for his troops. And the Pentagon calls that insubordination.
On strike: Believe it or not, French diplomats work not only for their governments, but also for their unions. French diplomats around the world went on strike today, because the French government is unwilling to pay the high price of competing with U.S. foreign policy.
"America's Bright Future": our special report on the remarkable children and teenagers in this country with extraordinary talents and minds. Tonight, we bring you the story of a young inventor.
And in "Broken Borders," millions of illegal aliens in this country enjoying the benefits of citizenship, because our government is unwilling to enforce security at our borders. Tonight, we'll be joined by former Immigration and Naturalization Service Special Agent Michael Cutler.
ANNOUNCER: This is LOU DOBBS TONIGHT for Monday, December 1. Here now, Lou Dobbs.
DOBBS: Good evening.
Tonight: U.S. commanders say they will continue their aggressive tactics against insurgents and terrorists after the most ferocious battle in Iraq since the fall of Saddam Hussein. American soldiers guarding supply convoys killed as many as 54 Iraqis in a series of fierce engagements in Samarra, about 75 miles north of Baghdad. Five American troops were wounded in the battle. None suffered serious wounds. An American soldier was killed elsewhere in Iraq today, when his convoy was attacked west of Baghdad.
Walt Rodgers in Baghdad has the report -- Walt.
WALTER RODGERS, CNN SR. INTERNATIONAL CORRESPONDENT: Hello, Lou.
The U.S. Army does indeed confirm that the action in Samarra Sunday afternoon was the biggest combat action U.S. forces have seen since the declared end of the war last May. And this time, it was the Iraqi supporters loyal to Saddam Hussein who got badly mauled.
The estimates range between 46 to 54 Iraqi dead. Body counts are an imprecise science. Only five Americans were injured. And four of those Americans are now back serving with their units. Here is what happened. Two groups of Iraqi guerrillas, between 30 and 40 guerrillas in each group, set an ambush in Samarra, a town which is known for its loyalties to Saddam Hussein, set the ambush for two U.S. convoys, logistical and supply, bringing money to two banks up there.
Captain Andy Deponai was there.
(BEGIN VIDEO CLIP)
CAPT. ANDY DEPONAI, U.S. ARMY: We believe it was -- they split their force in half as well and had a well-planned attack against each bank site. And we think we're looking at anywhere from 30 to 40 individuals at each bank site. And they had broken themselves down into squad and team size elements, so they could attack each bank from all sides.
(END VIDEO CLIP)
RODGERS: One of the Iraqis' hiding places was a mosque. They were actually using a mosque to hide their RPGs and their automatic weapons. When the Americans came into view, they came charging out of that mosque.
The aim was clearly to kill Americans in this ambush, although the Iraqis may well have known that this was a bank transaction as well and may have been trying to rob the money, which was coming there. Clearly, the Americans overwhelmed the Iraqis with their firepower. The American tanks are built to withstand a nuclear battlefield in Europe. And, consequently, when the Iraqi insurgents came charging with their RPGs and guns, the tanks were impervious. That's why the Americans had a rout.
Still, the Iraqis in the town were quick to blame the Americans. Of course, you might perhaps expect that, because this is a town where one of the safest things you do is blame the Americans -- Lou.
DOBBS: Walt, the coordination of these attacks, culminating in a ferocious battle, does this suggest that U.S. intelligence continues to be a serious shortcoming?
RODGERS: I don't think so, Lou.
The U.S. intelligence was pretty spot on in this incident in Samarra. The Americans knew. They even sensed -- one of the soldiers said, when he didn't see many civilians on the street, he knew there was an ambush. Remember, the U.S. forces had brought money to that town four times in the last three weeks. Each of the times, they came in for small-arms fire.
So the Americans were not deceived. It wasn't really what you call a particularly embarrassing ambush for the Americans, because the Americans rolled into Samarra with four main battle tanks. And they had such firepower that it was the Iraqis themselves who made fools of themselves -- Lou.
DOBBS: Walt, thank you very much -- Walt Rodgers reporting from Baghdad. Troops involved in the battle of Samarra today said they were surprised by the scale of the insurgents' attacks. But U.S. commanders said the enemy is making a dreadful mistake if it believes it can defeat American troops equipped with tanks and Bradley Fighting Vehicles.
Our senior Pentagon correspondent, Jamie McIntyre, reports now on the changing tactics in this war in Iraq -- Jamie.
JAMIE MCINTYRE, CNN MILITARY AFFAIRS CORRESPONDENT: Well, Lou, as Walt Rodgers just noted, this was the most coordinated and largest attack since the end of major combat. But, from a strictly military standpoint, U.S. commanders say it was spectacularly unsuccessful.
(BEGIN VIDEO CLIP)
BRIG. GEN. MARK KIMMITT, U.S. DEPUTY CHIEF OF OPERATIONS: Any enemy that is looking at eight tanks, four Bradley Fighting Vehicles and 93 coalition soldiers and still decides to fight is making a dreadful mistake. So I wouldn't consider that sophisticated at all.
(END VIDEO CLIP)
MCINTYRE: Now, Pentagon officials say it does appear that the attackers clearly knew that the U.S. was coming to Samarra to provide two banks with the new Iraqi dinars.
The insurgents set up roadblocks and attacked from various angles simultaneously, using small-arms mortars and rocket-propelled grenades in the kind of maneuver tactics that are more conventional on the battlefield. Now, the U.S. says, if this represents a new enemy tactic, it is one that the U.S. is well equipped to handle.
(BEGIN VIDEO CLIP)
GEN. PETER PACE, VICE CHAIRMAN, JOINT CHIEFS OF STAFF: They attacked and they were killed. So I think it will be instructive to them for future analysis, when they're thinking about what they're going to do next.
(END VIDEO CLIP)
MCINTYRE: Now, fighting the U.S. on the battlefield using conventional tactics is a prescription for failure, according to military experts, and could also be a sign of desperation.
But, frankly, U.S. commanders are at a loss to explain why the Iraqi insurgents have may have challenged U.S. firepower this way. They may have been trying to make a bold statement and simply miscalculated how well protected that convoy was. Nobody here seems to believe that this was actually an attempt to steal the money that was being delivered to the banks. As one Pentagon official said, this was not a bank heist that went awry -- Lou.
DOBBS: Jamie, thank you very much -- Jamie McIntyre, our senior Pentagon correspondent. The United States has too few regular Army units to carry out its considerable numbers of missions around the world. While the Pentagon has been innovative, creative and, to this point, successful, in managing this country's war-fighting resources, an unusually heavy burden and some would say unfair burden has fallen upon reservists and the National Guard.
Army reservists in upstate New York are being asked to sign a waiver that would clear the way for them to be deployed overseas again. This would be the second deployment for the 401st Civil Affairs Battalion in a year. By law, reservists receive 12 months downtime between overseas deployments unless they waive that right. Some reservists at the 401st are unwilling to sign that waiver.
Deborah Feyerick joins us now outside Rochester, New York -- Deborah.
DEBORAH FEYERICK, CNN CORRESPONDENT: Well, Lou, that's the big question. The Army has a policy for reservists that, if they do spend a year in combat, that they're entitled to come home for at least a year. But because of the shortage, a number of these soldiers are being asked to sign these waivers. There has been a lot of confusion among the soldiers. They've been seeking out their commanding officers to find out, do they have to sign these waivers and go back if they don't want to go back?
(BEGIN VIDEO CLIP)
CHRIS DRITSCHEL, U.S. ARMY SPECIALIST: I feel I already signed the contract saying I'm going to be in the Army for this amount of time. And I shouldn't have to sign anything else saying, well, I'm going to volunteer for this. I don't have to go. I don't see any reason why I should have to go if I've been there once already.
(END VIDEO CLIP)
FEYERICK: Now, Christopher Dritschel is one of those people who signed the waiver. But then he tore it up, saying that, if he didn't have to go, he wasn't going to go. Dritschel's bags are packed. He's been ordered to show up at Fort Bragg.
However, he is concerned that he will have to go without getting the proper amount of rest he can. One of his officers, a man by the name of Captain Steven McAlpin, stood up for his soldiers. But the Army called this insubordination. They kicked him out of the reserves.
(BEGIN VIDEO CLIP)
CAPT. STEVE MCALPIN, U.S. ARMY RESERVE: They're asking these soldiers to go up and beyond, when, legally, they're entitled to some rights of a stabilization period following a deployment.
(END VIDEO CLIP)
FEYERICK: Now, the soldiers can go back whenever the Army calls them up. They have tried to be considerate to make sure that the soldiers get the proper amount of rest.
But this is causing confusion within the ranks of the soldiers, because they don't know, can they go back? Do they have to go back? Should they go back? But it looks like they are going to go back once the New Year's comes -- Lou.
DOBBS: Deborah, thank you very much -- Deborah Feyerick reporting from Rochester, New York.
For more now on this issue and the strains facing our Army reservists and National Guard, I'm joined by General David Grange.
Good to have you with us, Dave.
RETIRED BRIG. GEN. DAVID GRANGE, CNN MILITARY ANALYST: Thank you, Lou.
DOBBS: This issue in particular -- let's start with Captain McAlpin, standing up, it appears, for his troops in this case. How would you react to that situation? To be thrown out of the reservists, a 25-year veteran, that seems remarkably severe.
GRANGE: Well, there is nothing wrong. And, in fact, it is duty of any commander to stand up for his troops, his or her troops, in any situation that they have a gripe. And I guess the captain did that.
The issue is, was he insubordinate to his chain of command? And that's for the Uniform Code of Military Justice to determine. It is an issue that is brought up, but it is tied to this bigger issue of understanding the law, the policies of mobilization.
DOBBS: Well, let's talk about the -- we saw the young -- the young soldier talking about the waiver. And these waivers are obviously affecting the entire unit and one presumes a reservist well beyond the 401st. Why, first, is the waiver necessary?
GRANGE: Well, I think there may be a little bit of a misunderstanding here as well with the unit.
And that is that, right now, the United States of America, the armed forces, are under what is known as partial mobilization. That gives the president the right to mobilize up to a million reservists for 24 months of time. And that is 24 months of mobilization time. Now, the policy of Department of Defense is to give soldiers a year break after a year of duty overseas, or even if it is the duties in the United States of America, but a year break back in their civilian status.
DOBBS: Right.
GRANGE: But it is a policy. It is not bound by law.
So, if they ask for a waiver, it is -- I'm not sure why they would ask for a waiver under 24 months.
DOBBS: General, why would the 401st be redeployed for a third time, not a second time, here?
GRANGE: Well, this is, again, one of the bigger issues involved, bigger than Captain McAlpin or others. And that is that, for instance, he's in a civil affairs unit.
The civil affairs are mainly made up of reservists, not active forces. And I think it is 96 percent of the civil affairs troops in the United States Army are in the reserves. So it's a high-use, but low-number unit. And these type of missions in Afghanistan and in Iraq require a lot of civil affairs troops, which the military is very short of.
DOBBS: There is also talk that the unit will be deployed to Fort Bragg for training, even if it isn't redeployed. This smacks of, if you will, retaliation in some ways.
GRANGE: Well, I hope it is not retaliation. I hope that what is happening is that the chain of command, the commanders of this unit, are going to Fort Bragg to train for readiness, if in fact they are deployed, because that eats up a lot of preparation time before they move the units overseas.
DOBBS: General, in point of fact, this strain that we're seeing put upon our reserves, upon our National Guard, it really goes fundamentally to the issue. Despite what this Pentagon and this secretary of defense has been maintaining for some time, we simply don't have enough regular Army to carry out the missions that have been imposed upon our young men and women in uniform all around the world, in addition to Iraq and Afghanistan.
GRANGE: That's exactly right. The military is too small for the task at hand. And what happens is, and another two or three second-, third-order effects will reach probably a culminating point of a crisis on shortages of troops.
DOBBS: General David Grange, thank you very much.
GRANGE: My pleasure.
DOBBS: Coming up next: The president steels himself for reaction to a massive rollback of a controversial tariff. Lisa Sylvester and White House correspondent Suzanne Malveaux report.
And then, in our special report tonight, "Broken Borders," a former INS special agent says this country does far too little to keep illegal aliens from crossing our borders. Michael Cutler joins us.
And "America's Bright Future," our series of special reports on this country's most promising young minds and talents, continues tonight -- an inventor who succeeded where the experts said he would fail. Bill Tucker will have his story.
(COMMERCIAL BREAK)
DOBBS: Thousands of French diplomats all around the world went on strike today, but the rest of the globe seemed to hardly notice. The diplomats stopped work for the day to protest budget cuts by the French Foreign Ministry. Unions -- yes, the French diplomats have unions -- say those cuts undermine President Chirac's goal of increasing France's global influence.
(BEGIN VIDEO CLIP)
LIONEL RUELLAN, STRIKING DIPLOMAT: We can't carry on like this. We need to change the policy. We need to stop reducing the employees over the world and try to make a living and represent France overseas, basically, in proper ways.
(END VIDEO CLIP)
DOBBS: Some critics might say that France has very little influence anyway and its leaders should stop pretending, for the benefit of their diplomats around the world, that France is once again a world power.
Diplomats on both sides of the Atlantic have been busy discussing U.S. steel tariffs, those tariffs introduced and imposed by President Bush 18 months ago to protect the U.S. steel industry from foreign competition. Tonight, however, President Bush appears ready to back down from the tariffs, a decision that could have important political consequences in this country.
Lisa Sylvester reports from Washington.
(BEGIN VIDEOTAPE)
LISA SYLVESTER, CNN CORRESPONDENT (voice-over): President Bush, visiting workers in Canton, Michigan, says he wants to protect American jobs and to keep U.S. markets open. But the two goals are not always mutually compatible. Steel producers say a decision to lift tariffs would hurt the industry just as it is getting back on its feet.
DAN DIMICCO, CEO, NUCOR STEEL: Only one third of what was needed to be done has been done. The acquisitions have started. The consolidations have started. It takes years to put through the transition, so you can achieve the benefits of that consolidation.
SYLVESTER: In March of 2002, the White House instituted tariffs on foreign steel to help the beleaguered American steel industry. But the World Trade Organization ruled last month, the tariffs violate international trade laws.
The European Union, Japan, South Korea and China threatened to block U.S. exports on numerous goods, including Harley-Davidson motorcycles, citrus products and textiles, if the United States did not reverse course. That could have sparked an all-out trade war.
ANDY LAPERRIERE, INTERNATIONAL STRATEGY & INVESTMENT: I think it would be economically and politically costly to have a trade war. It would be negative for financial markets. It would be negative for the economy. And I think it would be negative politically. SYLVESTER: The states who stand to benefit from the repeal, Florida and Washington state -- citrus and apple growers were worried about a loss of exports -- and Michigan. Automakers had been complaining they had to pay more for American steel. The administration may try to argue, it tried to keep protections in place as long it could.
BRINK LINDSEY, CATO INSTITUTE: They can say they did something for the steel industry. And now they can turn around to downstream industry, since we have cut them off early for your sake as well.
SYLVESTER: But lifting tariffs carries a political price tag with voters in steel-producing states, Pennsylvania, West Virginia and Ohio, key swing states.
(END VIDEOTAPE)
SYLVESTER: Lou, tomorrow, President Bush will face some of his toughest critics on this issue. He has a fund-raiser in Pittsburgh at the headquarters of the U.S. Steel Corporation -- Lou.
DOBBS: Not the best of timing, perhaps.
(LAUGHTER)
SYLVESTER: Not at all, Lou. It's going to be a tough visit for President Bush.
DOBBS: Lisa Sylvester, Thank you very much.
The White House believes the president can lift the steel tariffs without suffering major political damage, however. President Bush is likely to use some votes in steel-producing states, but he will probably win support in those states that have suffered from higher steel prices.
White House correspondent Suzanne Malveaux, traveling with the president tonight, joining us from Newark, New Jersey -- Suzanne.
SUZANNE MALVEAUX, CNN CORRESPONDENT: Well, Lou, a White House spokesman says the president has not made a decision yet, that they're still in consultations.
But administration sources telling us it is all but a done deal to lift those tariffs. Of course, that would have huge economic and political implications for the president. Just take Michigan, one of those battleground states. This is where the president was earlier at a small manufacturing plant. It would work in his favor. You know that Michigan -- he lost Michigan in 2000. But this is where, of course, factories and auto plants they say have been hurt by the tariffs.
It is also a place where his conservative base, they say that they're staunch advocates of free trade and they believe that President Bush abandoned their cause.
President Bush, earlier today, touching on that issue.
(BEGIN VIDEO CLIP)
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: We got some of greatest entrepreneurs in America. And, therefore, it seems like to make sense to me that we ought to be opening up markets for us to sell our goods. But the other thing I want you to understand is, we're going make sure it is fair. We want the playing field to be level, so we can compete in a fair way.
(END VIDEO CLIP)
MALVEAUX: Of course, lifting these tariffs could hurt him as well in those key battleground states. We're talking about West Virginia, as well as Ohio, as well as Pennsylvania, those steel- producing states.
But, of course, the political calculus here, Lou, is that they know that these possible sanctions with E.U., Japan, China and others hitting those products that are in states that are critical to a Bush reelection, talking about Florida oranges, Ohio motorcycles, other goods, they figure that it really is in their interests and their best interests to lift these tariffs, that it would be better overall for the economy, that the Bush administration could take the hit and they'll focus on that manufacturing sector and building those jobs -- Lou.
DOBBS: We'll see how that calculation works, Suzanne.
The president is talking fair trade. It is interesting to hear him using that expression, because this administration has been pushing free trade, as you well know, since inauguration day. This marks, does it not, a significant change in at least tone, tenor, if not policy.
MALVEAUX: Of course.
And, also, he has been talking about free trade and fair trade. It is one of those ways that he has been saying, in kind of a roundabout way, that he believes, of course, that, yes, this tariff was in place for a good reason, that, yes, they needed to protect the American steel industry within a three-year period. They may have to settle for 20 months.
DOBBS: Suzanne Malveaux, reporting from New Jersey, thank you very much.
Later here, I'll be talking about these steel tariffs, the likely lifting of those tariffs by the president and its effect on the steel industry. I'll be talking with Wilbur Ross. He is chairman of the International Steep Group, one of the most successful restructuring financiers in the country who has quite a few things to say about free and fair trade.
That brings us to the subject of tonight's poll. The question: Do you think ending tariffs on imported steel is unfair to U.S. steelworkers, yes or no? Cast your vote at CNN.com/Lou. We'll have the results later here.
When we continue, "Broken Borders" -- tonight, two disturbing reports on how government agencies have failed the American public at our borders. Kitty Pilgrim will report. And Michael Cutler, former senior special agent with the Immigration and Naturalization Service, joins us.
And "America's Bright Future" -- tonight, a teenage inventor who found a way to fight disease and deadly infection, when older minds said it couldn't be done. Bill Tucker will have the story.
(COMMERCIAL BREAK)
DOBBS: The Department of Homeland Security tomorrow will end a program to track potential terrorists in this country. That program, which requires men and boys from 25 Middle Eastern countries living in the United States to register with the government, was put into place following the terrorist attacks of September 11. A new program to track foreigners is expected to begin January 5.
Tonight, "Broken Borders" -- not only do more than 1,000 illegal aliens enter this country each and every day, but programs to inspect imported food are, at best, random. The Food and Drug Administration has now linked four companies in Mexico to the hepatitis outbreak in four states that killed three people and sickened more than 600 others. The FDA is now investigating in Mexico whether those plants are owned by American companies and whether they fail to meet the U.S. safety standards.
Kitty Pilgrim reports.
(BEGIN VIDEOTAPE)
KITTY PILGRIM, CNN CORRESPONDENT (voice-over): Mexico's still exports green onions to this country, but not by the four Mexican firms tied to the hepatitis A outbreak. A four-person team from the FDA and the CDC are inspecting operations in Mexican farms, from packing sheds to the water supply. The FDA does not normally do on- site inspections, except in the case of outbreaks. Activists say that needs to change.
CAROLINE SMITH DEWAAL, FOOD SAFETY DIRECTOR, CENTER FOR SCIENCE IN THE PUBLIC INTEREST: And they should be checking for things like the health conditions, the sanitation conditions, and whether the farms in fact have clean water. These kinds of checks should be standard for produce coming to the U.S. and not just used when there is a public health emergency.
PILGRIM: Back in 20001 and 2002, the FDA banned cantaloupes from Mexico after a salmonella outbreak. Controls were tightened. And only just now, after the Mexican government began a certification program, are Mexican cantaloupes being allowed back into the country again.
Back in 1997, strawberries from Mexico caused a hepatitis outbreak. No new cases have been reported since November 21. And the current outbreak seems to be contained. But 615 people were stricken with hepatitis A after eating at a Chi-Chi's restaurant near Pittsburgh. Three died.
Victims of the outbreaks are suing four American distributors or suppliers of the onions, Castellini Company of Kentucky, NewStar Fresh Food of California, Apio Fresh LLC of California, and Boskovich Farms of California.
(END VIDEOTAPE)
PILGRIM: One of the distributors, Apio Fresh, told us today they voluntarily asked their customers to pull all green onions off the market. They also suspended shipments from Mexico -- Lou.
DOBBS: Kitty, thank you very much -- Kitty Pilgrim.
We have been reporting here for months on how our broken borders have allowed an estimated 10 million illegal aliens to enter and reside in this country. They are now enjoying many of the benefits of citizenship, including education, free health care and, of course, employment.
My guest tonight has for decades been at the forefront of the fight against illegal immigration. Michael Cutler spent 30 years at the Immigration and Naturalization Service, retiring last year as senior special agent.
Good to have you with us, Michael.
MICHAEL CUTLER, FORMER SENIOR INS AGENT: Thank you. Good to be here.
DOBBS: The question cries out. And our viewers write in almost daily. What is it about illegal that American policy-makers don't quite understand?
CUTLER: Well, they don't seem to understand the word illegal. And we also seem to have a problem with the word alien. All too often, I see where journalists will refer to aliens who are illegally in the United States as undocumented workers, undocumented immigrants.
(CROSSTALK)
DOBBS: Where did that start, the idea of saying undocumented...
CUTLER: It actually started with President Jimmy Carter. A memo came out that was disseminated to all field agents and all personnel that, if we used the term illegal alien, that they would actually discipline us.
They wanted to change the mind-set. It reminded me of "1984," the idea of newspeak. We're going to change the words. We'll change the vernacular. And, consequently, we'll change the thought processes.
DOBBS: Political correctness... CUTLER: Absolutely.
DOBBS: ... its incipient stage.
CUTLER: Well, I believe that was the first example of political correctness.
DOBBS: Well, it also -- well, we can go back to 1971 "incursions" on the part of Nixon administration instead of "invasions" and "bombing attacks."
CUTLER: That's correct.
DOBBS: It's a time honored device, I think, of government, whether Democratic or totalitarian.
CUTLER: Well, bureaucracies do it all the time.
DOBBS: Absolutely.
The bureaucracy that was the INS, that is now homeland security and ICE, the thousands of border patrol agents, the men and women who are charged with securing our borders, how must they feel?
There is no will, apparently, on the part of other our policymakers or this administration or the administration's previous to enforce security at the borders, yet that is their charge. How -- What is their morale? What is their attitude?
CUTLER: Well, I always joke that there can be no problem with something that doesn't exist. If there is no morale, then, you know -- but the problem is it's not just the border patrol.
Half of the illegal aliens currently living inside our country today didn't run the border. They were admitted through ports of entry by our inspectors, as did the 19 terrorists who wreaked havoc on us.
So the bottom line is, what we need to understand is that immigration and law enforcement has to stand on three legs. We hear about the border patrol. We're aware of inspectors, but the third leg that keeps on getting neglected and ignored is interior enforcement that the special agents do.
DOBBS: And the terrorists of September 11, it's always important to note there was a crossing at the Canadian border, not the Mexican border.
It's -- often people look at it, when we talk about broken borders, we purposely make that plural.
CUTLER: Right.
DOBBS: It's not just the southern border. It's also the northern border.
CUTLER: And it's also the borders that exist at ports of entry, airports.
DOBBS: Absolutely.
CUTLER: And that's something that we keep neglecting.
DOBBS: The decision today to eliminate the program requiring the registration of young men and boys from 25 Middle Eastern countries and to put it aside and not worry about it until the 5th of January, when a new program will be introduced, what do we do with that two- month -- approximately two-month gap there?
CUTLER: Pray to God that nobody else falls through the cracks. And that's part of what the problem is.
You know, we also have 27 countries right now where their citizens are exempt the requirement of getting visas before they come to the United States. So we really don't even know who were admitted. We're allowing that system to rest on a name on a passport and nothing more than that.
DOBBS: Michael, with your experience, and with all you have seen and experienced, what's the solution?
CUTLER: We've got to change the Philosophy. We need more agents, more resources. We need the support of both political parties. They've got to stop politicizing this process. Democrats are looking for voters, and the Republicans are looking for cheap labor. And we're caught in the middle.
DOBBS: And I think you just said it. Well, the American people are caught in the middle. It's time something was done about it.
CUTLER: Absolutely.
DOBBS: I hope you'll come back soon as we explore this issue in the months ahead.
CUTLER: I welcome the opportunity. And I thank you for having me.
DOBBS: Thank you, Michael Cutler.
Let's take a look at some of your thoughts tonight.
From Miami, Florida: "Lou, I just want to thank you for your continuing coverage regarding the outsourcing of tech jobs and to shed light on one of the most important topics of all: the economy. What's happening with our country that we're so eager to give it away in a hand basket?"
On "Broken Borders," from Port Orange, Florida: "Lou, since you speak so eloquently about the illegals, why not stress the fact that we are not safe from terrorists since they can simply walk across our open borders. If the terrorists did come over the borders, who in the heck would know? Certainly not Homeland Security." And from Austin, Indiana: "I'm a senior, American citizen, and it is sad that we, as senior citizens, must choose to buy medicine or food when illegal immigrants are assured both when they enter the United States of America."
And from Tucson, Arizona: "Dear Lou, thank you for standing up against the illegals that come across our borders and cost us millions each year. I live in Tucson and have watched our hospital bills escalate to take care of them when so many of our Americans can't afford insurance to take care of their families. Our jail costs are unbelievable, let alone what it costs us to let them go to school for nothing. Our government is nuts to let that go on. If people want to come to the U.S., make them do it legally. I don't have a problem with that."
We love hearing from you. E-mail us at LouDobbs@CNN.com.
Coming up next here, turmoil inside two of the country's best- known biggest companies. Christine Romans will have the story.
And outgoing Boeing chairman and CEO Phil Condit and the man who will replace him join me.
Stay with us.
(COMMERCIAL BREAK)
DOBBS: Another rally on the market today, lifting the NASDAQ to its highest level in almost two years. And major shake-ups today in the leaderships of two of big American companies.
Christine Romans is here with all of that for us -- Christine.
CHRISTINE ROMANS, CNN CORRESPONDENT: On the first day of what is historically the best month for stocks, an 18-month high for the Dow and for the S&P 500.
Worried that stocks have rallied too far too fast? Sam Stowbah (ph) at S&P said don't. The S&P 500 up 34 percent, less than the average first year of a bull market. He said it would probably go a little further next year.
Now, on to the board room drama of the day. Roy Disney resigned from the board of Walt Disney, and Lou, he didn't go quietly.
He said Michael Eisner was the one who should go, because under his watch, Disney has suffered a creative brain drain, low morale because of micromanagement and poor performance.
Then board member Stanley Gold resigned, also calling for Eisner's ouster and decrying improvements in corporate government as image over substance.
Disney's board, once voted the worst in corporate American, was voted last year most improved by "Business Week," but critics argue Eisner has a "my company, my board" mentality. Until Disney replaces its board, it will continue to have those problems, many of those experts say.
Now, the tale of Boeing's CEO departure today is much different. Corporate governance experts say that the buck stops with the CEO, and Phil Condit stepped up to recent controversy.
Last week, Condit's No. 2 was ousted for improperly hiring an Air Force official. Louis Platt was named nonexecutive chairman and Harry Stonecipher takes the CEO mantle immediately, splitting Condit's job.
One ethics professor told me that there are some straight shooters on the Boeing board and that that might be a good direction for this company as it goes forward.
DOBBS: Well, Boeing's board, independent. We'll be talking with Phil Condit, the outgoing CEO and Stonecipher, the replacement here. But it's an interesting dichotomy. Disney's board and Boeing's, stepping up, insisting on accountability in one case and the other not.
ROMANS: Eisner stays and Condit goes.
DOBBS: Christine Romans, thank you.
Talk radio and conservatism, two entities long thought to be interchangeable. But a group of liberal investors say they're about to change all of that.
The newly formed Progress Media says it will buy radio stations in New York, Los Angeles, San Francisco, Philadelphia and Boston. They'll counter Rush Limbaugh. And the comedian Al Franken and actress Janeane Garofalo, they'll be the primary talent, apparently.
The new network plans to be up and running by next spring, just as the presidential campaign goes into high gear.
In Hollywood, political activists will gather for a so-called "Hate Bush" event tomorrow evening in Beverly Hills.
The wife of Seinfeld director and creator Harry David sent invitations to actresses Julia Louis-Dreyfus and Heather Thomas, among others. Its purpose, to prevent the, quote, "advancement of the current extremist right-wing agenda," end quote.
The new Iowa poll shows Howard Dean retaking the lead in Iowa from Dick Gephardt. WHO-TV in Des Moines found likely caucus goers supporting Dean over Gephardt by 10 points. Gephardt previously enjoyed a 17-point lead.
Tonight's quote is from another Democratic candidate for president on what is perhaps the most important issue now facing the economy, the defense of American jobs.
And we quote, "I'd like to see something that we haven't seen in this country among a lot of people, and that is economic patriotism. Let's have some commitment to do what's right for the American economy, for American workers, for American businesses. That's something the law can't require, but any American who cares about our country ought to be supporting."
That from Senator Joseph Lieberman of Connecticut.
Coming up next, a rollback of the steel tariffs will have a widespread effect on a number of industries and workers in this country. Wilbur Ross, the chairman of the International Steel Group, joins us to talk about why he thinks tariffs have succeeded and should be kept in place.
Stay with us.
(COMMERCIAL BREAK)
DOBBS: My next guest says the president was right to put those tariffs on imported steel and that if he's going to lift them, something else has to be done to protect the steel industry.
Wilbur Ross, chairman of the International Steel Group and chairman and CEO of W.L. Ross and Company joins me now.
Good to have you here, Wilbur.
WILBUR ROSS, CHAIRMAN, INTERNATIONAL STEEL GROUP: Thank you, Lou. Good to be here again.
DOBBS: The president, was he trying to avoid a trade war? Was it that simple?
ROSS: I think it's more complicated than that. But certainly what Laami (ph) did with saying he would put in tariffs on very innocent industries that have nothing to do with steel really is direct meddling in the U.S. presidential election. Imagine how angry the French would be if Bush did something like that in their election.
DOBBS: And since we buy far more of their products than they do from us, you might ask who the heck cares?
ROSS: Oh, yes. In fact, half of the total deficit that we have in trade is with Europe, Japan and Canada, three high cost countries, because they play games. It isn't because they're inherently lower costs.
DOBBS: And it looks like the administration may, in point of fact, allow them to play games. What can the president do? He's caught in a difficult political as well as economic situation.
ROSS: Yes.
DOBBS: What can he do to protect us?
ROSS: I think there are a number of things.
First of all, the 201 procedure, which is the one that led us to the steel tariffs, where the ITC found in the industry's favor, is a long and expensive process. Streamlining that in some way, so that if there is more dumping later, we can deal with it quickly, would be a very big help.
DOBBS: You know, a lot of people say, you know, U.S. steel producers simply don't want to compete on productivity with European steel makers, with Asian steel makers.
ROSS: The fact is we are more productive than they are. Our company takes less than one man hour to make a ton of steel. The Europeans average 2.6. The Chinese average 6.
DOBBS: The position being, then, that they're dumping. And the American steel worker, there are now 150,000 people who have their jobs invested in that industry. Can those jobs survive?
ROSS: They can, if the continuity lets the industry continue to restructure. We pretty much have done what we need do. We have 31 steel companies in bankruptcy with around 35,000 active employees and 100,000 retirees who will be left with no health benefits if those companies go down the drain.
DOBBS: You believe this president, this Congress will keep those -- maintain a commitment to those companies and those workers?
ROSS: I don't know about to those workers. I think he will do something to help the steel industry, and I think he's becoming much more conscious of the problem. I like him saying "fair trade"...
DOBBS: Yes, we heard that today for the first time.
ROSS: ... instead of just "free trade". New rhetoric. New rhetoric.
DOBBS: Hopefully, there will be some meaning behind it. But you can't always bank on that in Washington.
ROSS: No. But at least rhetoric may be a start.
DOBBS: There you go. Wilbur Ross, good to have you with us. Thank you.
ROSS: Thank you. Good to be on.
DOBBS: When we continue, a shake-up at the top of the world's largest aerospace company. Outgoing chairman/CEO of Boeing, Phil Condit, and his successor, Harry Stonecipher, will join me next.
Stay with us.
(COMMERCIAL BREAK)
DOBBS: I'm joined now by the past and future leaders of the country's leading aerospace company.
Phil Condit today resigned under pressure from his board as the CEO and co-chairman of his company. Condit said he wanted to put the distractions and controversies of the past year behind Boeing and instead put focus on performance. Harry Stonecipher, named Boeing's new CEO and president. Stonecipher retired last year after serving as vice chairman, president and chief operating officer. Both join us tonight from Boeing headquarters in Chicago.
Good to have you both here.
HARRY STONECIPHER, NEW BOEING CEO: Thank you.
PHIL CONDIT, OUTGOING BOEING CEO: Thank you, Lou.
DOBBS: A difficult day, I know, for you, Phil. And a difficult charge for you, Harry, as you look to the future of the company.
Let me start, Phil, the controversies that have embroiled Boeing, starting with the tanker controversy, the leases, the firing of your CFO last week, charges of inappropriate conduct, unethical conduct in two other cases, principle cases.
How did you get to this point, Phil?
CONDIT: Well, one of the things I really want is I want this company to succeed. And what I saw was unless we did something, took some pretty dramatic action, the focus was going to be on these issues.
The rest of the company is running superbly. We've got great programs, they're doing great things, but the distractions were taking away from that.
I said to the board, "Look, if it's going to make this company better, and more successful, I'd be willing to step away and make a change if we can take it forward."
They talked about it a lot. And they ended up saying, "OK, that's what we'll do." That's what we did.
DOBBS: Phil, straight up, this was your idea. You weren't forced out by your board of directors?
CONDIT: Absolutely straight up. This was me leading with that statement, the board talking about it, reaching a decision and I had exactly zero pressure to do that. Nobody even said to me, "Would you consider it?"
DOBBS: Mike Sears and Darleen Druyun using inside information, is the allegation, to win contracts. The issue of the tanker contracts, these represent ethical breeches that one doesn't associate with Boeing.
You have an independent board of directors, you have a clear-cut governance policy, and yet this and more happened under your watch. How did it happen?
CONDIT: Well, first, let's deal with what the allegations are and what we found in our investigation. What we found was that Mike talked to Darleen about potential employment, ahead of when she recused herself. We found no evidence whatsoever that any information was exchanged or anything was granted. It was just that conversation.
The real issue for us was that it didn't come out until we dug into it. So we don't think there was anything gained by Boeing in that process. But we also felt we had to act and did.
DOBBS: Harry, is it your -- if I may turn to Harry Stonecipher now, the man who's going to have to carry the mantle forward, you were there during many of the allegations as chief operating officer, going back to the Raytheon deal, to a number of the other issues.
Harry, what do you do here? Phil turning in his resignation, stepping aside, is that -- because many people will suggest it -- to blunt the investigations and the hearings on Congress that sure to follow all that has transpired at Boeing this year?
STONECIPHER: Well, I think we have to go ahead and answer all the allegations, continue the investigation. And we have good policies and procedures. And as you mentioned, this is a very ethical company with great integrity.
And when people violate those policies and procedures, then you have to deal with it. And in fact we did. And we did when it happened. Unfortunately, some of the investigations were flawed and brought about some further allegations.
So we're going to have to be sure that we answer all the questions. All of the questions for everyone.
DOBBS: And how long do you think it's going to take for you to come to a conclusion on a number that -- I mean, you've got the satellite division; you've got the commercial aircraft division; you've got military procurement; you've got these other issues. I mean, this is -- it's a short word. It's a mess.
STONECIPHER: My -- it's not a mess. We've got a lot of great people doing a lot of great things. And...
DOBBS: Well, if you don't -- Harry, if you don't call that a mess, I don't know what you would call a mess.
STONECIPHER: It's the concentration of right now, let's get the tanker program straightened out. The commercial guys have been doing a great job. And they're going to bring forward to the board this month a brand new airplane for us to consider. And I'll be concentrating on the problems in the defense area.
DOBBS: And, Harry, Phil has built a reputation in this country as an ethical and effective executive, your board is independent. You have separated the chairman and the CEO function.
Do you have further plans in mind? Are you going to look for another CEO? Is there a search under way? STONECIPHER: There is no search underway, as there's -- the board has a succession process that it continually looks at and has. And I'm sure that in due course down the road they will decide that Harry Stonecipher has been here long enough. If I'm performing, it will be a little longer than it will be if I'm not performing. So we'll...
DOBBS: But you plan on being there for a considerable period of time?
STONECIPHER: Absolutely. As I -- I was pleased to work beside Phil, implementing the strategy that he define, and I'm happy to be the one that will go forward and try to implement his vision.
DOBBS: Now the execution. Harry Stonecipher, CEO of Boeing, Phil Condit, former CEO. Gentlemen, we thank you both for being here.
CONDIT: Thank you.
STONECIPHER: Thank you, Lou.
DOBBS: Coming up next, "America's Bright Future," our series of special reports on some of the remarkable young people who together make this nation's future loom so brightly.
And tonight, the experts said it couldn't be done. But one young man found a solution to a difficult problem that older minds said it couldn't be done. That's next.
(COMMERCIAL BREAK)
DOBBS: Well, 57 percent of you said yes to the question, "Do you think ending tariffs is unfair to U.S. steel workers?" Forty-three percent said no.
Tonight, a young man who caught the attention of the scientific community at the age of 15. Bill Tucker has his story.
(BEGIN VIDEOTAPE)
BILL TUCKER, CNN CORRESPONDENT (voice-over): They are the menace of summer, spreading malaria, yellow fever, encephalitis and West Nile Virus. And thanks to this young man, a new sonic weapon has been added to the arsenal against mosquitoes.
MICHAEL NYBERG, INVENTED MOSQUITO CONTROL MACHINE: When I put the sound into the water, these air bladders will resonate. And they vibrate so much that they'll explode from the tissue that's holding them in. And without these air bladders, they'll essentially suffocate.
TUCKER: Michael Nyberg was only 15 when he made his discovery, and that's after he was told it would not work. Amazingly, his machine kills only mosquito larva and harms nothing else, meaning that it can be used where spraying and pesticides are prohibited. JOSEPH CONLON, MOSQUITO CONTROL ASSN: This was absolutely out of the blue, which is quite remarkable and, again, quite welcome for someone thinking outside the box, so to speak, to thinking beyond standard and normal mosquito control procedures.
TUCKER: Not content to just stop at the idea, Michael and his father started a business, New Mountain Innovations. The business remains small because they focused on selling mainly to health departments.
NYBERG: So far I see it fairly successful. I mean, we've taken this idea. We built the first unit is a storm drain unit. And we built that two years ago and started selling it, and it's grown in popularity this year.
TUCKER: This winter, Mike and his dad will unveil a unit that will work in marshlands, which they hope will open up a consumer market. Not bad for a guy that's just a freshman at Clarkson University in upstate New York, where he's studying engineering.
Michael is an Eagle Scout, a member of his school's Air Force ROTC, and Michael is a young man with his eyes set on the future.
NYBERG: My future? I hope that after -- well, after working in the Air Force, I hope to work with NASA in their space program but also work with the New Mountain Innovations.
The new frontier. It's just the idea of going out there in space, in a totally different world, and it's nothing like you've probably been on, nothing you can experience on earth.
TUCKER: So what's next for Michael? He's turning his focus to water.
(END VIDEOTAPE)
TUCKER: Michael's noticed that there's literally water everywhere, but Lou, only three percent of the available water can be used.
DOBBS: And Michael's on the case.
TUCKER: He is.
DOBBS: Remarkable young man. Thank you very much, Bill Tucker.
That's our show for tonight. We thank you for being with us. For all of us here, good night from New York City.
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Diplomats Strike>
