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Lou Dobbs Tonight
Fed Chairman Urges Cuts in Social Security; Pennsylvania Threatened By Outsourcing
Aired February 25, 2004 - 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.
(BEGIN VIDEOTAPE)
LOU DOBBS, CNN ANCHOR: Tonight: a clear warning from the Fed chairman. Congress, he says, will have to cut the future Social Security benefits of tens of millions of baby boomers who are nearing retirement age.
In Pennsylvania, the export of American jobs overseas is threatening to destroy the state's economy, so say lawmakers who are proposing some of the toughest laws in the country to restrict outsourcing.
MIKE MCGEEHAN (D), PENNSYLVANIA STATE REPRESENTATIVE: The shameful practice of outsourcing is continuing. And it's impacting literally millions of Americans.
DOBBS: Presidential hopeful John Kerry today announced a plan to limit outsourcing. Democratic National Committee Chairman Terry McAuliffe is our guest.
In "Failing Grades" tonight, No Child Left Behind, one of the most far-reaching reforms in modern education history and one of the most controversial.
And "Passion of the Christ" opens today. After months of protests and hype. My guests tonight are a priest, a pastor and a rabbi, all of whom, unlike most of the movie's critics and supporters, have actually seen the film.
(END VIDEOTAPE)
ANNOUNCER: This is LOU DOBBS TONIGHT for Wednesday, February 5. Here now for an hour of news, debate and opinion is Lou Dobbs.
DOBBS: Good evening.
Democratic presidential candidate Senator John Kerry today announced a plan to curb the massive outflow of American jobs to cheap overseas labor market, what we call here "Exporting America." Senator Kerry said he wants companies to give workers three months notice if they want to send jobs overseas and to disclose those plans to the government. It is the latest in a series of attacks on outsourcing by Senator Kerry and his principal remaining rival for the nomination, Senator John Edwards.
(BEGIN VIDEOTAPE) DOBBS (voice-over): Senator Kerry today unveiled his plans to cut back on outsourcing of American jobs.
SEN. JOHN KERRY (D-MA), PRESIDENTIAL CANDIDATE: We're going to require full disclosure to the American public about how many jobs are being overseas, where they are going, why they are going and companies will no longer be able to simply surprise their workers with a pink slip instead of a paycheck.
DOBBS: Kerry's plan, three months notice to affected employee, local state and federal agencies for companies planning to outsource, a federal government accounting of jobs lost to outsourcing, an end to tax credits that give companies breaks for moving jobs offshore, and no outsourcing of federal contracts when possible.
Outsourcing is a hot topic in Ohio.
PROF. RICK FARMER, UNIVERSITY OF AKRON: Among voters in the Democratic primary in Ohio, NAFTA is going to be a very important issue, because labor is such a large percentage of the vote there. And if John Kerry wants to win Ohio, he needs to explain to the labor voters why he voted in favor of NAFTA and why his position on NAFTA is not contrary to their interests.
DOBBS: A fourth of Ohio's 192,000 lost manufacturing jobs were due to trade and outsourcing. More than 14,000 other jobs were lost as a direct result of NAFTA. And Senator John Edwards is focused on outsourcing as well in most of his speeches.
SEN. JOHN EDWARDS (D-NC), PRESIDENTIAL CANDIDATE: They said that the outsourcing of millions of American jobs over the next decade was good for the American economy. What planet do these people live on?
DOBBS: Edwards plan to curb outsourcing, a 10 percent tax cut for companies that manufacture goods in the United States employing American workers and the elimination of tax breaks for companies moving their headquarters overseas.
(END VIDEOTAPE)
DOBBS: Senator Edwards' campaign swing through Rochester, New York, earlier this week was rewarded today. Senator Edwards picked up an endorsement from long-time Mayor William Johnson. Johnson cited Senator Edwards' commitment to protecting and creating American jobs. The Rochester area has lost more than 11,000 manufacturing jobs over the past two years.
House Minority Leader Nancy Pelosi today called on Congress to give manufacturing companies tax breaks to help keep jobs in this country. Congresswoman Pelosi said American workers cannot wait any longer for help. The National Association of Manufacturers welcomed part of the California Democrats' plan, but said she has not been a supporter of manufacturing companies for very long.
Also on Capitol Hill, two Democratic lawmakers introduced a bill to prevent U.S. taxpayer dollars from being used to outsource jobs to other countries. Congresswoman Rosa DeLauro and Congressman John Dingell said outsourcing should not be an option for the federal government.
Turning from jobs to another critical issue now facing this government, the federal budget and the future of Social Security. Federal Reserve Chairman Alan Greenspan today called on Congress to take control of the soaring federal budget deficit and to cut Social Security benefits for future retirees. The Fed chairman said lawmakers must take action to avoid tax increases that would hurt the economy as well.
Kitty Pilgrim reports.
(BEGIN VIDEOTAPE)
KITTY PILGRIM, CNN CORRESPONDENT (voice-over): Get used to these pictures. There will be more of them. The first wave of the 77 million baby boomers is about to start retiring in four years. Alan Greenspan told the House Budget Committee, with so many retirees, the Social Security system is overextended.
Greenspan proposed having retirees collect less, lower the cost of living adjustments and collect later in life, because people live longer.
ALAN GREENSPAN, FEDERAL RESERVE CHAIRMAN: Dramatic demographic change is certain to place enormous demands on our nation's resources, demands we almost surely will be unable to meet unless action is taken.
PILGRIM: In 1983, the Social Security system was nearly broke. Greenspan chaired a special commission to find a way to make it solvent again. Some say today's proposals don't go far enough.
PETER ORSZAG, BROOKINGS INSTITUTION: It is important to realize That the two specific steps that he put forward today would be helpful in addressing the long-term deficit in Social Security, but they would only solve about a third of the problem. So a lot more would be necessary.
PILGRIM: The comments set off a quick reaction from Democratic candidates.
KERRY: No matter what was said in Washington just this morning, the wrong way to cut the deficit is to cut Social Security benefits.
EDWARDS: The answer is not to cut Social Security benefits for those who need them and depend on them.
PILGRIM: Talking about cutting Social Security benefits is always the so-called third rail of politics, a lethal topic. Today, it was no different.
(END VIDEOTAPE)
PILGRIM: Congress is unlikely to amend Social Security in an election year. But Greenspan said today something has to be done right away to give future retirees time to make alternate financial plans -- Lou.
DOBBS: An astounding, candid statement from the Fed chairman.
PILGRIM: It was a little bit of a shock, but he just came right out and said it.
DOBBS: And the reaction from the Senate -- the presidential candidates, Senators Kerry and Edwards, not surprising. Thank you, Kitty.
President Bush said there is no need to cut Social Security benefits for current retirees or for people nearing retirement. President Bush today should the best way to cut the deficit is for Congress to pass his budget plan for 2005.
Senior White House correspondent John King has the report -- John.
JOHN KING, CNN SR. WHITE HOUSE CORRESPONDENT: Well, Lou, Mr. Bush had a meeting in the Oval Office not long after Chairman Greenspan made that dramatic testimony.
Now, the president, you'll remember, in the last campaign, called for letting those investing in Social Security to take a small bit of their payroll taxes and invest in the stock market or private investments. The president made the case for that plan today, but he also made clear he was not prepared in this election year to deal with the bigger structural issues, as suggested by Chairman Greenspan.
(BEGIN VIDEO CLIP)
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: My position on Social Security benefits is this, that those benefits should not be changed for people at or near retirement. As you know, in the 2000 campaign, I articulated a point of view that we ought to have personal savings accounts for younger workers. That would make sure those younger workers receive benefits equal to or greater than that which is expected. I still maintain the same position.
(END VIDEO CLIP)
KING: White House aides concede the president understands those bigger structural issues like raising the retirement age, like perhaps cutting cost of living increases need to be dealt with. But it is his view they should be dealt with in a bipartisan way after the presidential election.
And, Lou, it was very interesting watching both parties try to gain partisan advantage from Chairman Greenspan's testimony today. Democrats liked what he said about growing deficits, threatening living standards in this country. Republicans loved it when Chairman Greenspan said, if you are dealing with a deficit, cut spending before you raise taxes and that, in his view, if spending is kept under control, that those 10-year Bush tax cuts should remain permanent. Chairman Greenspan saying they would help the economy -- Lou.
DOBBS: John, both parties, Democrats and Republicans, have mad more than ample opportunity since the Greenspan commission in 1983 to deal with the very serious threats to the Social Security system of this country. The idea that neither party wants to, with some courage in an election year, deal with what the Fed chairman said is a clear and present danger, that's -- that doesn't sit too well, I would suspect, with many voters.
KING: It probably doesn't sit well with the voters. It certainly doesn't sit well with even many members of Congress. Remember, President Bush had convened a commission chaired by the now late New York Senator Daniel Patrick Moynihan just a while back.
And all these issues were on the table, including the president's, of course, plan for those private investment accounts. But then the stock market went down and the recession early in the Bush administration. And everybody backed away from this. Nobody wanted to touch it. It's clear now, Lou, that at least the view of this administration is that it's not worth debating it in this election year, that Congress will not deal wit.
So, from a political standpoint, the president's view is, put it off until next year.
DOBBS: John King, thank you.
Still ahead here, one of the most controversial movies ever, "The Passion of the Christ," finally opens.
(BEGIN VIDEOTAPE)
UNIDENTIFIED MALE: It's the truth, very powerful.
(END VIDEO CLIP)
DOBBS: In the Martha Stewart trial, the defense rests after attorneys call only one witness, a live report from federal court in New York.
And after President Bush effectively launches his reelection campaign, Democratic National Committee Chairman Terry McAuliffe is our guest. Stay with us.
(COMMERCIAL BREAK)
DOBBS: Mel Gibson's controversial film "The Passion of the Christ" has opened across the country. That film is attracting huge crowds and a lot of controversy.
Eric Philips reports.
(BEGIN VIDEOTAPE)
ERIC PHILIPS, CNN CORRESPONDENT (voice-over): "The Passion of Christ" depicts the final hours of Jesus' life, leading up to his crucifixion.
UNIDENTIFIED MALE: It just takes a heavy toll, an unrelenting toll.
PHILIPS: Some call it far too graphic and gory. Director Mel Gibson calls it real
MEL GIBSON, DIRECTOR: I want people to understand the reality of the story. I want them to be taken through an experience. I want them to feel.
PHILIPS: Many pastors across the country want non-Christians to feel led to come to Christ after viewing this film. But not everyone is celebrating his film's release. Some Jewish leaders are decrying the film, saying it's anti-Semitic, blaming Jews for Jesus' death.
RABBI LEO M'ABRAMI-BETH, MOVIEGOER: The way Jews are being portrayed, as some kind of bloody murders, that troubles me a great deal.
PHILIPS: Although moviegoers are walking away with different reaction, one thing is the same. They are walking away talking. We spoke with this woman both before and after she saw the movie.
UNIDENTIFIED FEMALE: I'm sure I will be spiritually moved, but I'm not sure if I'm going to be shocked.
Horrifying, it was haunting and it was beautiful, all at the same time.
(END VIDEOTAPE)
PHILIPS: And we are live here in Kennesaw, Georgia, just north of Atlanta, in the heart of the Bible Belt, where people here, as well as nationwide, have had an opportunity up until today to hear from spiritual leaders, to hear from Mel Gibson himself, and even to hear from P.R. experts.
But today, those same people had an opportunity to view this film, "The Passion of the Christ," for themselves and to judge its merits. The film did open today in more than 2,000 theaters nationwide. And, already, many shows are sold out for days to come. It's rated R for its graphic content -- Lou.
DOBBS: Eric, thank you very much -- Eric Philips.
We'll have more on this controversial film later in the broadcast, when I talk with three religious leaders, a priest, a pastor, a rabbi, all three of whom have seen the movie and they have three quite different reactions.
It is also the subject of our poll tonight: Are you planning to see this movie, "The Passion of the Christ," yes or no? Cast your vote at CNN.com/Lou. We'll have the results later.
Turning now to the Martha Stewart trial, Stewart's defense today rested its case after calling only one witness, whose testimony lasted just 45 minutes. Martha Stewart didn't take the stand in her own defense.
Mary Snow is at the federal courthouse in Lower Manhattan with the story -- Mary.
MARY SNOW, CNN CORRESPONDENT: Lou, today's quick ending for the defense was in stark contrast to the government's case of four weeks. They call 21 witnesses. And Stewart's team expressed, confidence was behind their decision for the brevity of their case and for not having Martha Stewart testify.
Their one witness was an attorney put on the stand to counter the prosecution's version of what Martha Stewart told government investigators following her sale of ImClone stock. But the government had the final say. And the last thing jurors heard today was a potentially damaging audiotape of Stewart's co-defendant, Peter Bacanovic, contradicting earlier testimony from Stewart's business manager about an agreement to sell ImClone once it hit $60.
And that $60 agreement is at the heart of the defense case. Attorneys are going to give their closing arguments early next week and the jury is set to get this case next Wednesday -- Lou.
DOBBS: Mary, thank you -- Mary Snow.
Coming up next, Super Tuesday just six days away. Senator John Edwards is fighting for a much needed victory. I'll be talking with Democratic National Committee Chairman Terry McAuliffe about the Democrats and their challengers next.
And still ahead in "Exporting America," Pennsylvania has set a new standard for legislation to keep jobs in this country. We'll have that report. We'll also be joined by Congressman Dan Burton of Indiana and software company Parasoft co-founder Adam Kolawa. They will face off on the subject of outsourcing -- all of that and a great deal more still ahead here.
Please stay with us.
(COMMERCIAL BREAK)
DOBBS: Well, this week, the Democratic presidential candidates facing two new challenges, one from President Bush, who effectively launched his reelection campaign this week with a speech attacking front-runner Senator John Kerry, the other from Ralph Nader, who said he is running for president as an independent.
Joining me now from Washington, the chairman of the Democratic National Committee, Terry McAuliffe.
Very good to have you here.
TERRY MCAULIFFE, DNC CHAIRMAN: Great to be back, Lou.
DOBBS: How concerned are you, first of all, about Ralph Nader's entry into the contest?
MCAULIFFE: Not overly concerned.
I wish he hadn't run. He made the decision. But he's running as an independent and not as a Green Party member. He has told me as late as last night when I spoke to him that his goal is to beat George Bush and he wants to beat Bush as much as I do. I disagreed. I don't think that's possible. However, he said he wants to work with us to defeat George Bush. I take him at his word. Hopefully, at the end of the day, he will support the Democratic nominee for president.
DOBBS: Do you expect that to occur?
MCAULIFFE: Well, he's out traveling. He's in Texas campaigning about George Bush. He thinks George Bush has been a disastrous president. The jobs, obviously, clean water, clean air, something he's cared about his whole life, very concerned about what George Bush has done.
I think, when we get into October 1 -- I said, last night, I said, Ralph, on October 1, I hope you're back with us, supporting the Democratic nominee, because we're going to accomplish what you want to do, get this country moving again, creating jobs, and getting rid of the worst environmental president we have ever had.
DOBBS: We had a lightning bolt from the Fed chairman today, saying that Congress simply has to deal with this federal budget deficit and it has to begin wrestling with the idea of cutting back benefits for future retirees. Your reaction?
MCAULIFFE: No surprise to me. This is what the Republicans have wanted to do all along.
Listen, George Bush and the Republicans in Congress would like to get rid of Social Security as we know it today. They want to roll back different programs. Seniors today are really counting on Social Security to take care of them in the time they need it. He is either going to have to raise taxes or he's going to have to cut benefits. George Bush has to come clean with the American people.
And sending an economic report up to Congress last week which says that we're going to create 2.6 million new jobs, which they backed off immediately, and four pages that system we should send our jobs overseas is not a Bush economic plan. And that's why we're in very good shape today. George Bush's reelect is down. Democrats are doing great. We're close to getting a nominee. But everybody is unified. We got to get rid of George Bush.
DOBBS: Terry, I quite understand your mission. But, also, the Democrats and Republicans, it seems at least to me, bear equal responsibility for the shambles in which we find Social Security in this country. It's been long delayed, long deferred.
The president has said that he does not want to deal with this issue in this election year. The Democratic candidates had, if you will, a reflexive statement today, but really nothing of substance. Do you think there's any possibility that the Democratic Party can take the lead and say they do want to deal with this and move legislation to address the issue?
MCAULIFFE: Well, as much as I love you, Lou, I've got to disagree with you.
I just remind you of the eight great years we had under the Clinton/Gore administration, when they added about 28 years to the financial solvency of Social Security, really added funds to protect it for many years to come. With George Bush, with his reckless tax cuts to the top 1 percent, the gigantic deficit that we now have in our country, a $10 trillion shift under George Bush, you get a Democratic as president, and all the viewers go out there and we put a Democrat in office, I'll tell you, we'll go back to creating jobs, we'll go back to creating surpluses in this country.
George Bush has no plan. All he keeps saying is, let's make the tax cuts to the top 1 percent. All we're doing is making this deficit bigger and bigger. Our kids are going to have to pay for this, Lou. My five children are going to have to worry about this deficit. It's time to take some serious action, create jobs. And George Bush has to get his head out of a hole and realize what is going on in this country. And we have got to get this country back to work again.
DOBBS: You're saying you don't want to deal with it either during this current year?
MCAULIFFE: Well, I mean, Lou, I will give you reality. We don't control the United States House. We don't control the United States Senate. We don't control the White House.
This is George Bush and the Republican Party government, no ifs, ands or buts. We're in this mess because of the Republicans. You put a Democrat back in control in the White House and in the House and the Senate, we'll go back to job creation. We'll be going back to surpluses. Bill Clinton added years to the financial solvency of Social Security under his presidency.
George Bush's presidency, the only thing you can see now is he has put Social Security in a crisis situation. He has underfunded education, underfunded health care, unfunded mandates on homeland security. He has not made us safer. And these are the issues of what this election is all about, Lou.
DOBBS: Terry McAuliffe, thanks for being with us.
MCAULIFFE: Great to be with us. Thank you.
DOBBS: We wanted to share with you a cartoon that caught our attention here. It is on the subject of outsourcing and the Bush administration support of exporting work overseas, as expressed by Chairman of Council Economic Advisers Greg Mankiw.
The cartoon reads, "For a defense of administration policy that outsourcing U.S. jobs is good, we go now to Bangalore, India, to a White House spokesman named Ravi Singh Jai (ph)." Thanks to cartoonist Mike Luckovich at "The Atlanta Journal-Constitution," who was kind enough to share his work with you and us.
Just ahead, the battle against the outsourcing of American jobs is sweeping through state legislators. Pennsylvania the latest state to join the battle. We'll have a report for you.
And our series of special reports, "Failing Grades," tonight focusing on No Child Left Behind.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: It's going to leave a lot of children behind. It is going to work the hardest handicaps on the poorest children simply by the underfunding and the punishment mechanisms.
(END VIDEO CLIP)
DOBBS: The cornerstone of President Bush's domestic agenda. We'll bring you a report card two years later.
And the very passionate debate about "The Passion of the Christ." We'll hear from three religious leaders who have three different views of this controversial movie.
(COMMERCIAL BREAK)
DOBBS: Pennsylvania has joined the list of states lining up to ban the overseas outsourcing of state contracts. A bill was recently introduced that would penalize companies that ship American jobs overseas.
Bill Tucker reports.
(BEGIN VIDEOTAPE)
UNIDENTIFIED MALE: Thirty thousand jobs in the last 2 1/2 years have been wiped out.
BILL TUCKER, CNN CORRESPONDENT (voice-over): Declaring outsourcing a threat to the future of Pennsylvania, a bill has been introduced in the state legislature. It is among the toughest in the country. If approved, the bill would not allow state or local contracts to be awarded to companies that would outsource the work.
It would require companies to disclose if they outsource more than 100 jobs to a foreign country. And if a company does outsource more than 100 jobs, it would be precluded from receiving any state aid or state and local contracts for seven years. In the words of one legislator, Pennsylvania is bleeding jobs, the taste is bitter, and he says support for an anti-outsourcing bill is strongly bipartisan.
MCGEEHAN: The jobs that were lost in steel and the jobs that were lost in textiles, we retrained them for I.T. jobs. They are being displaced a second time in their lifetime. That's obscene. That's wrong. And I think the legislature in Pennsylvania is going to stand up and say, enough is enough. TUCKER: The issue of disclosure is also gaining attention from legislators in Florida. Two years ago, the state awarded a $280 million contract to Convergys, which freely admits it outsources work to India.
UNIDENTIFIED MALE: Those firms should not do business with the state of Florida if they're willing to privatize their work force out of this country. If they want the benefit of taxpayer dollars, then they ought to keep the jobs here. I think it's only fair.
TUCKER: Convergys responds by saying, it created jobs in Florida.
(END VIDEOTAPE)
TUCKER: Six hundred jobs, to be exact. And the company says that all of those jobs went to Florida residents, as required by the contract -- Lou.
DOBBS: The issue in Pennsylvania is becoming critical, obviously.
TUCKER: Yes.
DOBBS: I talked with Congressman John Peterson today. In that state's -- most of that state's delegation is wrestling with this issue, trying to come to terms in a state that has been buffeted by the loss of manufacturing jobs, high value jobs, as well. Thank you very much, Bill.
Outsourcing is at the heart of tonight's face off. Joining us now, Congressman Dan Burton of Indiana. Congressman Burton says outsourcing poses a threat to our national security.
On the other side of this issue is Adam Kolawa, the co-founder, the CEO of the software company Parasoft who says the benefits of outsourcing far outweigh the negatives.
Welcome to you both. Thanks for being here to discuss this issue which is not only controversial, but is complex as think as any of us would like it to be.
Adam, let me turn to you first. The idea that we have lost hundreds of thousands of jobs in the past year, that we are projected by one study, the UC Berkeley study, to have 14 million jobs at risk here to outsourcing, how do you see that contributing to anything at all for working men and women in this country contributing to high value jobs?
ADAM KOLAWA, CHMN, CEO PARASOFT CORP: Well, you know, I would like to talk only about outsourcing in the software industry, because that's what I really know. There is a lot of outsourcing which is happening in other sectors, which is telecom and things like that. And I don't want to talk about that.
Let me give you a scenario how outsourcing really works for me and how it works in the software industry. Imagine that you have a company and you are running this company. And you need to make a payroll every month or every 2 weeks. Now you are running out of money or you are need to really make your company profitable.
What you do is you are trying to make sure you can reduce you costs. One way to reduce the cost is outsource part of the work force you have. And let's say you outsource 20 percent of your work force. Let's say that you didn't outsource and you failed. What is better to do? Is it better to fail as the company and 60 percent of your employees would stay or 80 percent which stayed don't have jobs anymore? What would you say to that?
DOBBS: You're asking me?
KOLAWA: Right, because that is the question I think politicians have to answer.
DOBBS: I think the question would be why in the world would you be in a business which you could not work indigenously to the economy? And if it's important to you -- are you an international company?
KOLAWA: I am international.
DOBBS: Are you putting those jobs overseas in order to be near a market and drive product in that market?
KOLAWA: No, I mean at the beginning...
DOBBS: Then I think you are outsourcing and I think you are ultimately going to export both your knowledge base within your company, your intellectual property and you are going to -- you're forestalling the inevitable.
Because if your only advantage is on cost of labor, I don't think you've got much of an opportunity strategically and you are going to get outthought, outmaneuvered and outhustled by foreign competition.
KOLAWA: OK. Now if we continue. OK, what's happening is...
DOBBS: Let me bring in Congressman Burton here. Congressman Burton's state, the largest number of manufacturing operations in the country, in the state of Indiana. We've lost 2.6 million, is it generally agreed upon estimate of the number of jobs we've lost over the last three years. Your party, your president, has basically embraced the idea of outsourcing, has presided over this -- this flood, this torrent of jobs that have left the country. Your feeling, sir?
REP. (R) INDIANA: First of all, let me say, Lou that the president has done some things that I think have helped stem the tide, so to speak, of the loss of jobs going overseas with the tax cuts and the incentives that the administration has pushed through the Congress. But after saying that, we have lost 2.5 to 3 million manufacturing jobs that probably aren't going to come back to the United States. We're losing as many as 20,000 job as month so a lot needs to be done. We need to have regulations in this country regarding small business change. We need more tax cuts for business, which would create an incentive for them to be able to stay here. And then we need to deal with our foreign trading partners, much more severely. The value of the currency in China is 40 to 50 percent underfunded which gives them a tremendous advantage in trade. And as a result they have $120 billion surplus right now.
DOBBS: Let me turn to you now, Adam. In answering your question, as best and as honestly as I could, what you are -- is your reaction to that?
KOLAWA: Well, what I think is we are politicizing the issue which is really a matter of industry maturing and I think outsourcing is the part of maturing process which industry is going through. Every industry went through this process and we need to go through this process.
DOBBS: I'm sorry, who went through this process?
KOLAWA: Every other industry which is a mature industry went through a similar process of outsourcing.
DOBBS: No, sir, no, sir. No, no, if I may say just straight out.
KOLAWA: OK.
DOBBS: The fact of the matter is, that we have seen outsourcing accelerated at unprecedented level in high value jobs primarily in technology and very high value jobs. It's never happened before in history.
The second part of that statement is not to suggest, I hope, that we should just accept it as if we're some sort of indifferent idiots what is happening to working men and women in this country and allow you or any other company doing business in this country and internationally to do what you wish irrespective of its impact on our society.
KOLAWA: I really disagree with this and I respectfully disagree with this. What we think we are building the jobs and let me tell you how. What we are building, is because we are able to reduce the cost and because we are able to outsource the tasks which are really not critical for our development as the company, we are able to use that manpower which we have to create much better focus and much better products to...
DOBBS: So now you are outsourcing because it is not simply cheaper labor and not cheaper as you first stated but now because you're innovating and creating new products?
KOLAWA: No, what I am saying to you I am trying to continue the scenario in how it is really helping us. OK, and what would happen is because you free your work force from work which is really not creative the work can produce new intellectual property and it can actually build better products. Now the better products can be used to get the company produce...
DOBBS: Adam, you make it sound now as if you are outsourcing and taking American jobs away as a matter of convenience to your other employees to free them up for innovation. In point of fact, in software in this country, the 25 percent of that work is being done, by some estimates, overseas that work could be done here, as well. And I'm not sure I -- I can tell you quite, clearly I don't grasp, why you think it should be your prerogative with a U.S. based company to simply export labor? Why should we not be able, competitively, to constrain companies such as yours?
KOLAWA: We are not exporting labor, we are specializing. And that's the process, specialization. In the software industry...
DOBBS: I have to turn to Congressman Burton for a conclusion here. Congressman, you are somewhat at odds with your own party and leadership in the White House. What do you think needs to be done?
BURTON: First of all, our trade agreements should be bilateral. We should be hard-nosed with our trading partners. China, for instance, which has the biggest trade surplus in the world with us should be taken to task because they have under valued their currency and as a result they entice people, like this gentlemen, to send jobs overseas.
Our industrial base is jeopardized. If we ever have to go to war again like we did in World War II we're going to have a real problem, because our industrial base is being eroded along with our jobs. We need to change that so we're safe militarily, No. 1, and we're protecting American jobs.
I believe in free trade, but I also believe in fair trade. And that means we need to negotiate very hard with our trading partners and the multilateral trade agreements like NAFTA simply don't work.
DOBBS: Just a concluding thought, if I may react, Adam, and Congressman, the idea that these jobs are being exported overseas, whether it be to Eastern Europe, whether it be to India, whether it be to China, the fact that we're running a half trillion dollar trade deficit in this country, does it amuse either of you? Do either of you grasp the irony that we sort of put it down into a free trade, so this mindless mantra of free trade while our trading partners understand this is not -- anything other than a zero sum game. That they have a strategy, that they have an approach, and they have a plan while we keep saying we're not responsible. Just an adjunct to free trade? Adam, your thoughts?
KOLAWA: Well, I don't think so. I think we are developing our organization.
DOBBS: You think it's serendipity?
KOLAWA: I really think it is a political issue which people are using this to get political votes instead of thinking how their business needs to be done. DOBBS: I am going to have to call it there and I thank you both for being here. Adam, Congressman, thank you very much, gentlemen, for being here.
Coming up next, a violent new movie about the final hours of the life of Jesus Christ. Critics say that it could deeply hurt relations between Christians and Jews. We'll be talking with three religious leaders, Father Jim Martin, Rabbi Adam Minsk and a Pastor Kevin Jonas next.
And later our special report, failing grades, a government program designed to save our schools could be doing more harm than good. That and a great deal more still ahead. As always, please stay with us.
(COMMERCIAL BREAK)
DOBBS: Mel Gibson's "The Passion of the Christ" opened today to sold- out audiences all across the country. This film depicts the final hours of Jesus' life, as if you didn't know what this film was about, and it has been panned by many critics who say it is not historically accurate, simply too violent and it creates divisions between Christians and Jews.
Joining us now to talk about this movie is Father Jim Martin, good to have you here. And Pastor Kevin Jonas, good to have you here. And Rabbi Adam Mintz. Good to have you with us.
This movie is, at least in my memory, is the most controversial film I've ever heard of. I don't know how much of that is -- springs true and spontaneously from the culture we're in and how much of it is hype. Did you like the movie?
FATHER JAMES MARTIN, ASSOCIATE EDITOR, "AMERICA MAGAZINE": I didn't. I think while there are a lot of parts I found very moving I thought some parts were somewhat anti-Semitic and I thought the violence was way over the top for this kind of movie.
DOBBS: You thought it was anti-semitic which is the principle charge against it from a Catholic priest that is -- that's a serious charge.
MARTIN: Well, in parts, it was anti-Semitic. I thought the way that Pilate was portrayed vis-a-vis Pontius Pilate who I think Mel Gibson sort of let off the hook. Pilate was a very brutal governor of Jerusalem at the time. And I thought in contrast (UNINTELLIGIBLE) came off as this villain. And I think that's a very irresponsible way...
DOBBS: (UNINTELLIGIBLE) is whom?
MARTIN: He's the high priest at the time that Jesus is around.
DOBBS: Let me turn to you, pastor. Your thoughts?
REV. KEVIN JONAS, PASTOR, WYCKOFF ASSEMBLY: I thought it was a powerful movie. It was difficult to watch because of the violence, but it was an incredible display of love and I felt like it showed the Jewish people, compassionate especially the people in the crowd. There were numerous instances of people showing compassion in torment over what Christ was going through.
DOBBS: Jewish people.
JONAS: Jewish people in the crowd. Including carrying the cross, the giving of water, of course, he was surrounded by Jews, his believers, his mother, Mary, John, his followers were with him and they were also Jew. He was a Jew.
DOBBS: The only people not Jewish would be the Romans themselves, correct?
JONAS: The Romans were the only parties that were involved in this story and I believe it was accurate out of the gospels with few artistic deviations.
DOBBS: Rabbi, your thoughts?
RABBI ADAM MINTZ, LINCOLN SQUARE SYNAGOGUE: As a movie-goer, a movie lover, I found the movie much too violent. Violent, gory, very difficult to watch. I can't remember the last time I looked at my watch so many times during a two-hour movie.
DOBBS: The fact that it's not in English, did that contribute to the clock watching?
MINTZ: No question about that. Not only sit not in English but it's in an ancient language that really sounds like gibberish and even for people who know Hebrew it was very difficult language to make out anything.
DOBBS: The anti-Semitic charge, do you give it validity?
MINTZ: I felt at least one scene was very much anti-Jewish. The scene of a Jewish mob, a large Jewish group in this square and they are the ones who were screaming, crucify him! And the Roman governor, Pilate is seen almost as weakling as if he is being pushed by the Jews.
DOBBS: Is that not within the creative license? I don't know what is going through Mel Gibson's mind and I can't imagine what his motives were, they are obviously powerful and apparently sincere attempt artistically to express his religious faith and precepts. He maintains steadfastly he is not being anti-Semitic. Is this far too much criticism, Father, to lay on an artist who has chosen to deal with a controversial topic. In any case?
MARTIN: Well, I think his intent is sincere. We have to give him the benefit of the doubt. The final product is another story. I think that while he did not -- I'm sure he did not intend to make an anti-Semitic film, his selection of which gospel passages he chose I think contributed to this picture of the Jews as primarily responsible for Christ's death. So it's not enough to just say it's in the gospels, it's which gospels do you pick?
DOBBS: I take it that you consider the anti-Semitism of the movie somewhat more strongly than the Rabbi. You feel it somewhat more broader.
MARTIN: I think the Catholic church worked very hard to prevent some of these passion plays from becoming anti-Semitic. I think he stepped into a lot of the traps, unfortunately. One of the biggest traps is letting Pilate off the hook, which I think he does in the movie. Pilate comes across as very thoughtful, persuasive character
DOBBS: Your thoughts?
JONAS: The image he is speaking of is directly out of the gospels. To leave a segment of the gospels out is to leave a segment of our faith. For those of us that believe that the Bible is sincere, that the Bible is accurate, that the Bible is to be believed literally, to remove one -- to remove one verse, to remove one line, to remove one image is to forsake that segment of your faith.
DOBBS: You're not accusing Mel Gibson of doing that simply because as an artist he had to do so?
JONAS: No, I'm saying he left it in. The accusation here is including crucify him, in the picture, is anti-Semitic and it's not. The Bible that I read was written by Jews. I serve a God that was Jewish. And that Jewish faith, we don't consider ourselves separate from but grafted in.
DOBBS: Rabbi, you get the last word.
MINTZ: I would -- I can't say what Mel Gibson intended but I think the question is not so much his intention but what the result is going to be. If people come out of the movie with an impression from that scene that you discussed as being anti-Jewish, as if the Jews were unnecessarily violent or cruel toward Jesus, I think for that Mel Gibson would have to answer and we would have to be able to address that issue, as well.
DOBBS: We are literally out of time but I just have to ask this. Did this movie in any way disturb or enhance your personal religious beliefs?
MARTIN: Well, it was very emotional to watch it. As some points I could feel myself entering the story. But I think it exempted the story so much from the ministry and the resurrection as to be almost meaningless.
DOBBS: Pastor Jonas?
JONAS: It greatly influenced my faith. Encouraged me and the images will affect me for the rest of my life.
MINTZ: Troubled me. And if anything, it made me go back and try to understand the story of the last 12 hours of Jesus more thoroughly. DOBBS: I can't help but think as we're wrapping up here, and I thank you all three of you being here, this is creating a discussion broadly about religion and faith that otherwise would not have been, I think I'm perhaps prejudiced always in the favor of the artist. But it even has wayward fellows like me thinking about it and talking about it. We thank you very much for the opportunity.
A reminder now to vote in our poll tonight. Are you planning to see "The Passion of the Christ?" Yes or no." Cast your vote at CNN.com/lou. We'll have the results for you in just a few minutes.
Coming up next, it was supposed to be leave no child behind. But some teachers say that law is leaving too many students in schools far behind. Our series of "Special Reports" this week, failing grades, education in America continues next.
(COMMERCIAL BREAK)
DOBBS: Our special report, "Failing Grades," education in America tonight, No Child Left Behind, one of the most far reaching attempts at education reform. But many educators say it is simply expensive, confusing, and desperately underfunded at the same time. The once popular law is now a growing controversy over the state of education in this country.
Peter Viles reports.
(BEGIN VIDEOTAPE)
PETER VILES, CNN CORRESPONDENT (voice-over): Born two years ago with bipartisan support the No Child Left Behind law is now suffering growing pains.
UNIDENTIFIED FEMALE: Put the reading journals back into the basket.
VILES: Critics from Vermont to Utah say it's a mandate without the money to pay for it. It labels hundreds of schools of failing based on a confusing thousand page law which contains no national standard but plenty of national rules.
WILLIAM MATHIS, SUPERINTENDENT, RUTLAND NORTHEAST DIST: It's going to have the opposite effect. It's going to leave a lot of children behind. It's going to work the hardest handicaps on the poorest children simply by the underfunding and the punishment mechanism. So, I think it's harmful.
VILES: Behind the criticism, nobody likes to be told that their school is failing. Leicester Central school in Vermont is a rural school with 75 kids that failed by a whisker to meet Vermont's relatively high standards.
CAROL ECKELS, PRINCIPAL LEICESTER CENTRAL SCHOOL: When we made the list it was devastating to the staff.
LAURA CORO, FOURTH GRADE TEACHER, LEICESTER CENTRAL SCHOOL: I'll never forget the day. The principle called a special meeting we were like, wow, what is going on. And we came in here and we all sat down and she told us we had a check mark. That we were a failing school and I was mortified.
VILES: The president has time and again defended the idea of testing and holding schools accountable.
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: I have heard every excuse in the book about measurement. You are testing too much, you are teaching the test. Don't test. If you don't test you have a system that just shuffles the kids through, and that's unacceptable.
VILES: The Department of Education has not yet released national data on how many American schools are making good progress and how many are failing. And whether the law is fully funded or not it is expensive. Federal education spending has rocketed 55 percent in three years to $36 billion last year.
(END VIDEOTAPE)
VILES: And critics say that's not enough. Senator Ted Kennedy argues the administration has underfunded this law by $9 billion in the coming year. The administration says fund something adequate and that in fact billions of dollars have sat unused in the Federal Treasury because states didn't always claim them on time.
DOBBS: At the end of the day, it just isn't working and it's not working for too many kids. The Department of Education doesn't seem to be getting it done.
VILES: Well, they are at a bit of a disadvantage, because this is really a ten or 11 year project for this law to run its course. It's being attacked now in the first and second year. Senator Kennedy has said that he is at a crossroads on this whether or not to introduce legislation to change it.
DOBBS: And we'll be talking to Senator Kennedy, on the subject of education later this week.
Pete, thank you very much.
On Wall Street, stocks ended what was a five session losing streak. The Dow gaining 357 points. The Nasdaq up 17. The S&P up almost five.
New trouble tonight for Disney chief Michael Eisner. Christine Romans here with the report, Christine.
CHRISTINE ROMANS, CNN CORRESPONDENT: This country's largest pension fund says it has lost confidence in Michael Eisner, Lou. CALper says it can not support Eisner, and the company's performance over the past five years has been dismal. And an individual adviser Glass Lewis, also recommends voting against Eisner and two board members. It says the Disney board has been notoriously insular, famously gullible and blindly loyal to Mr. Eisner." The firm said yes, the board has made progress towards independence but just not enough.
Also, a peek this week into the paycheck of some of Wall Street's titans. Goldman Sach's CEO Hank Paulson pay check doubled last year, Lou. He received 21 million in restricted stock on top of 600,000 salary, even has Goldman grappled with regulators on several front.
At JP Morgan William Harrison made 20 million last year.
His merger partner Jamie Dimon of Bank One got 19 million.
And Cendant's CEO fared even better, 23 million for Henry Silverman and he exercised $37 million in stock option. A good time if you're a CEO, and AT&T announcing it's going to cut another 8 percent of its work force, 4,600 workers, fired 18,000 last year.
DOBBS: Thank you, Christine.
Coming up next, the results of our poll and a reminder to check our Web site for the complete list of the companies we've confirmed to be "Exporting America." Cnn.com/lou. We'll continue in a moment, stay with
(COMMERCIAL BREAK)
DOBBS: Now the results of "Tonight's Poll." Forty-three percent of you plan on seeing the movie "Passion of Christ," 57 percent do not.
That's our show for tonight. We thank you for being with us.
Tomorrow Senator Ted Kennedy joins us to talk about the education crisis and how to fix it. And a trade war brewing between the United States and Europe. I'll be talking with European Union trade commissioner Pascal Lamy. He'll be with us, we you are as well.
For all of us here good night from New York. "ANDERSON COOPER" is next.
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Threatened By Outsourcing>
Aired February 25, 2004 - 18:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
(BEGIN VIDEOTAPE)
LOU DOBBS, CNN ANCHOR: Tonight: a clear warning from the Fed chairman. Congress, he says, will have to cut the future Social Security benefits of tens of millions of baby boomers who are nearing retirement age.
In Pennsylvania, the export of American jobs overseas is threatening to destroy the state's economy, so say lawmakers who are proposing some of the toughest laws in the country to restrict outsourcing.
MIKE MCGEEHAN (D), PENNSYLVANIA STATE REPRESENTATIVE: The shameful practice of outsourcing is continuing. And it's impacting literally millions of Americans.
DOBBS: Presidential hopeful John Kerry today announced a plan to limit outsourcing. Democratic National Committee Chairman Terry McAuliffe is our guest.
In "Failing Grades" tonight, No Child Left Behind, one of the most far-reaching reforms in modern education history and one of the most controversial.
And "Passion of the Christ" opens today. After months of protests and hype. My guests tonight are a priest, a pastor and a rabbi, all of whom, unlike most of the movie's critics and supporters, have actually seen the film.
(END VIDEOTAPE)
ANNOUNCER: This is LOU DOBBS TONIGHT for Wednesday, February 5. Here now for an hour of news, debate and opinion is Lou Dobbs.
DOBBS: Good evening.
Democratic presidential candidate Senator John Kerry today announced a plan to curb the massive outflow of American jobs to cheap overseas labor market, what we call here "Exporting America." Senator Kerry said he wants companies to give workers three months notice if they want to send jobs overseas and to disclose those plans to the government. It is the latest in a series of attacks on outsourcing by Senator Kerry and his principal remaining rival for the nomination, Senator John Edwards.
(BEGIN VIDEOTAPE) DOBBS (voice-over): Senator Kerry today unveiled his plans to cut back on outsourcing of American jobs.
SEN. JOHN KERRY (D-MA), PRESIDENTIAL CANDIDATE: We're going to require full disclosure to the American public about how many jobs are being overseas, where they are going, why they are going and companies will no longer be able to simply surprise their workers with a pink slip instead of a paycheck.
DOBBS: Kerry's plan, three months notice to affected employee, local state and federal agencies for companies planning to outsource, a federal government accounting of jobs lost to outsourcing, an end to tax credits that give companies breaks for moving jobs offshore, and no outsourcing of federal contracts when possible.
Outsourcing is a hot topic in Ohio.
PROF. RICK FARMER, UNIVERSITY OF AKRON: Among voters in the Democratic primary in Ohio, NAFTA is going to be a very important issue, because labor is such a large percentage of the vote there. And if John Kerry wants to win Ohio, he needs to explain to the labor voters why he voted in favor of NAFTA and why his position on NAFTA is not contrary to their interests.
DOBBS: A fourth of Ohio's 192,000 lost manufacturing jobs were due to trade and outsourcing. More than 14,000 other jobs were lost as a direct result of NAFTA. And Senator John Edwards is focused on outsourcing as well in most of his speeches.
SEN. JOHN EDWARDS (D-NC), PRESIDENTIAL CANDIDATE: They said that the outsourcing of millions of American jobs over the next decade was good for the American economy. What planet do these people live on?
DOBBS: Edwards plan to curb outsourcing, a 10 percent tax cut for companies that manufacture goods in the United States employing American workers and the elimination of tax breaks for companies moving their headquarters overseas.
(END VIDEOTAPE)
DOBBS: Senator Edwards' campaign swing through Rochester, New York, earlier this week was rewarded today. Senator Edwards picked up an endorsement from long-time Mayor William Johnson. Johnson cited Senator Edwards' commitment to protecting and creating American jobs. The Rochester area has lost more than 11,000 manufacturing jobs over the past two years.
House Minority Leader Nancy Pelosi today called on Congress to give manufacturing companies tax breaks to help keep jobs in this country. Congresswoman Pelosi said American workers cannot wait any longer for help. The National Association of Manufacturers welcomed part of the California Democrats' plan, but said she has not been a supporter of manufacturing companies for very long.
Also on Capitol Hill, two Democratic lawmakers introduced a bill to prevent U.S. taxpayer dollars from being used to outsource jobs to other countries. Congresswoman Rosa DeLauro and Congressman John Dingell said outsourcing should not be an option for the federal government.
Turning from jobs to another critical issue now facing this government, the federal budget and the future of Social Security. Federal Reserve Chairman Alan Greenspan today called on Congress to take control of the soaring federal budget deficit and to cut Social Security benefits for future retirees. The Fed chairman said lawmakers must take action to avoid tax increases that would hurt the economy as well.
Kitty Pilgrim reports.
(BEGIN VIDEOTAPE)
KITTY PILGRIM, CNN CORRESPONDENT (voice-over): Get used to these pictures. There will be more of them. The first wave of the 77 million baby boomers is about to start retiring in four years. Alan Greenspan told the House Budget Committee, with so many retirees, the Social Security system is overextended.
Greenspan proposed having retirees collect less, lower the cost of living adjustments and collect later in life, because people live longer.
ALAN GREENSPAN, FEDERAL RESERVE CHAIRMAN: Dramatic demographic change is certain to place enormous demands on our nation's resources, demands we almost surely will be unable to meet unless action is taken.
PILGRIM: In 1983, the Social Security system was nearly broke. Greenspan chaired a special commission to find a way to make it solvent again. Some say today's proposals don't go far enough.
PETER ORSZAG, BROOKINGS INSTITUTION: It is important to realize That the two specific steps that he put forward today would be helpful in addressing the long-term deficit in Social Security, but they would only solve about a third of the problem. So a lot more would be necessary.
PILGRIM: The comments set off a quick reaction from Democratic candidates.
KERRY: No matter what was said in Washington just this morning, the wrong way to cut the deficit is to cut Social Security benefits.
EDWARDS: The answer is not to cut Social Security benefits for those who need them and depend on them.
PILGRIM: Talking about cutting Social Security benefits is always the so-called third rail of politics, a lethal topic. Today, it was no different.
(END VIDEOTAPE)
PILGRIM: Congress is unlikely to amend Social Security in an election year. But Greenspan said today something has to be done right away to give future retirees time to make alternate financial plans -- Lou.
DOBBS: An astounding, candid statement from the Fed chairman.
PILGRIM: It was a little bit of a shock, but he just came right out and said it.
DOBBS: And the reaction from the Senate -- the presidential candidates, Senators Kerry and Edwards, not surprising. Thank you, Kitty.
President Bush said there is no need to cut Social Security benefits for current retirees or for people nearing retirement. President Bush today should the best way to cut the deficit is for Congress to pass his budget plan for 2005.
Senior White House correspondent John King has the report -- John.
JOHN KING, CNN SR. WHITE HOUSE CORRESPONDENT: Well, Lou, Mr. Bush had a meeting in the Oval Office not long after Chairman Greenspan made that dramatic testimony.
Now, the president, you'll remember, in the last campaign, called for letting those investing in Social Security to take a small bit of their payroll taxes and invest in the stock market or private investments. The president made the case for that plan today, but he also made clear he was not prepared in this election year to deal with the bigger structural issues, as suggested by Chairman Greenspan.
(BEGIN VIDEO CLIP)
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: My position on Social Security benefits is this, that those benefits should not be changed for people at or near retirement. As you know, in the 2000 campaign, I articulated a point of view that we ought to have personal savings accounts for younger workers. That would make sure those younger workers receive benefits equal to or greater than that which is expected. I still maintain the same position.
(END VIDEO CLIP)
KING: White House aides concede the president understands those bigger structural issues like raising the retirement age, like perhaps cutting cost of living increases need to be dealt with. But it is his view they should be dealt with in a bipartisan way after the presidential election.
And, Lou, it was very interesting watching both parties try to gain partisan advantage from Chairman Greenspan's testimony today. Democrats liked what he said about growing deficits, threatening living standards in this country. Republicans loved it when Chairman Greenspan said, if you are dealing with a deficit, cut spending before you raise taxes and that, in his view, if spending is kept under control, that those 10-year Bush tax cuts should remain permanent. Chairman Greenspan saying they would help the economy -- Lou.
DOBBS: John, both parties, Democrats and Republicans, have mad more than ample opportunity since the Greenspan commission in 1983 to deal with the very serious threats to the Social Security system of this country. The idea that neither party wants to, with some courage in an election year, deal with what the Fed chairman said is a clear and present danger, that's -- that doesn't sit too well, I would suspect, with many voters.
KING: It probably doesn't sit well with the voters. It certainly doesn't sit well with even many members of Congress. Remember, President Bush had convened a commission chaired by the now late New York Senator Daniel Patrick Moynihan just a while back.
And all these issues were on the table, including the president's, of course, plan for those private investment accounts. But then the stock market went down and the recession early in the Bush administration. And everybody backed away from this. Nobody wanted to touch it. It's clear now, Lou, that at least the view of this administration is that it's not worth debating it in this election year, that Congress will not deal wit.
So, from a political standpoint, the president's view is, put it off until next year.
DOBBS: John King, thank you.
Still ahead here, one of the most controversial movies ever, "The Passion of the Christ," finally opens.
(BEGIN VIDEOTAPE)
UNIDENTIFIED MALE: It's the truth, very powerful.
(END VIDEO CLIP)
DOBBS: In the Martha Stewart trial, the defense rests after attorneys call only one witness, a live report from federal court in New York.
And after President Bush effectively launches his reelection campaign, Democratic National Committee Chairman Terry McAuliffe is our guest. Stay with us.
(COMMERCIAL BREAK)
DOBBS: Mel Gibson's controversial film "The Passion of the Christ" has opened across the country. That film is attracting huge crowds and a lot of controversy.
Eric Philips reports.
(BEGIN VIDEOTAPE)
ERIC PHILIPS, CNN CORRESPONDENT (voice-over): "The Passion of Christ" depicts the final hours of Jesus' life, leading up to his crucifixion.
UNIDENTIFIED MALE: It just takes a heavy toll, an unrelenting toll.
PHILIPS: Some call it far too graphic and gory. Director Mel Gibson calls it real
MEL GIBSON, DIRECTOR: I want people to understand the reality of the story. I want them to be taken through an experience. I want them to feel.
PHILIPS: Many pastors across the country want non-Christians to feel led to come to Christ after viewing this film. But not everyone is celebrating his film's release. Some Jewish leaders are decrying the film, saying it's anti-Semitic, blaming Jews for Jesus' death.
RABBI LEO M'ABRAMI-BETH, MOVIEGOER: The way Jews are being portrayed, as some kind of bloody murders, that troubles me a great deal.
PHILIPS: Although moviegoers are walking away with different reaction, one thing is the same. They are walking away talking. We spoke with this woman both before and after she saw the movie.
UNIDENTIFIED FEMALE: I'm sure I will be spiritually moved, but I'm not sure if I'm going to be shocked.
Horrifying, it was haunting and it was beautiful, all at the same time.
(END VIDEOTAPE)
PHILIPS: And we are live here in Kennesaw, Georgia, just north of Atlanta, in the heart of the Bible Belt, where people here, as well as nationwide, have had an opportunity up until today to hear from spiritual leaders, to hear from Mel Gibson himself, and even to hear from P.R. experts.
But today, those same people had an opportunity to view this film, "The Passion of the Christ," for themselves and to judge its merits. The film did open today in more than 2,000 theaters nationwide. And, already, many shows are sold out for days to come. It's rated R for its graphic content -- Lou.
DOBBS: Eric, thank you very much -- Eric Philips.
We'll have more on this controversial film later in the broadcast, when I talk with three religious leaders, a priest, a pastor, a rabbi, all three of whom have seen the movie and they have three quite different reactions.
It is also the subject of our poll tonight: Are you planning to see this movie, "The Passion of the Christ," yes or no? Cast your vote at CNN.com/Lou. We'll have the results later.
Turning now to the Martha Stewart trial, Stewart's defense today rested its case after calling only one witness, whose testimony lasted just 45 minutes. Martha Stewart didn't take the stand in her own defense.
Mary Snow is at the federal courthouse in Lower Manhattan with the story -- Mary.
MARY SNOW, CNN CORRESPONDENT: Lou, today's quick ending for the defense was in stark contrast to the government's case of four weeks. They call 21 witnesses. And Stewart's team expressed, confidence was behind their decision for the brevity of their case and for not having Martha Stewart testify.
Their one witness was an attorney put on the stand to counter the prosecution's version of what Martha Stewart told government investigators following her sale of ImClone stock. But the government had the final say. And the last thing jurors heard today was a potentially damaging audiotape of Stewart's co-defendant, Peter Bacanovic, contradicting earlier testimony from Stewart's business manager about an agreement to sell ImClone once it hit $60.
And that $60 agreement is at the heart of the defense case. Attorneys are going to give their closing arguments early next week and the jury is set to get this case next Wednesday -- Lou.
DOBBS: Mary, thank you -- Mary Snow.
Coming up next, Super Tuesday just six days away. Senator John Edwards is fighting for a much needed victory. I'll be talking with Democratic National Committee Chairman Terry McAuliffe about the Democrats and their challengers next.
And still ahead in "Exporting America," Pennsylvania has set a new standard for legislation to keep jobs in this country. We'll have that report. We'll also be joined by Congressman Dan Burton of Indiana and software company Parasoft co-founder Adam Kolawa. They will face off on the subject of outsourcing -- all of that and a great deal more still ahead here.
Please stay with us.
(COMMERCIAL BREAK)
DOBBS: Well, this week, the Democratic presidential candidates facing two new challenges, one from President Bush, who effectively launched his reelection campaign this week with a speech attacking front-runner Senator John Kerry, the other from Ralph Nader, who said he is running for president as an independent.
Joining me now from Washington, the chairman of the Democratic National Committee, Terry McAuliffe.
Very good to have you here.
TERRY MCAULIFFE, DNC CHAIRMAN: Great to be back, Lou.
DOBBS: How concerned are you, first of all, about Ralph Nader's entry into the contest?
MCAULIFFE: Not overly concerned.
I wish he hadn't run. He made the decision. But he's running as an independent and not as a Green Party member. He has told me as late as last night when I spoke to him that his goal is to beat George Bush and he wants to beat Bush as much as I do. I disagreed. I don't think that's possible. However, he said he wants to work with us to defeat George Bush. I take him at his word. Hopefully, at the end of the day, he will support the Democratic nominee for president.
DOBBS: Do you expect that to occur?
MCAULIFFE: Well, he's out traveling. He's in Texas campaigning about George Bush. He thinks George Bush has been a disastrous president. The jobs, obviously, clean water, clean air, something he's cared about his whole life, very concerned about what George Bush has done.
I think, when we get into October 1 -- I said, last night, I said, Ralph, on October 1, I hope you're back with us, supporting the Democratic nominee, because we're going to accomplish what you want to do, get this country moving again, creating jobs, and getting rid of the worst environmental president we have ever had.
DOBBS: We had a lightning bolt from the Fed chairman today, saying that Congress simply has to deal with this federal budget deficit and it has to begin wrestling with the idea of cutting back benefits for future retirees. Your reaction?
MCAULIFFE: No surprise to me. This is what the Republicans have wanted to do all along.
Listen, George Bush and the Republicans in Congress would like to get rid of Social Security as we know it today. They want to roll back different programs. Seniors today are really counting on Social Security to take care of them in the time they need it. He is either going to have to raise taxes or he's going to have to cut benefits. George Bush has to come clean with the American people.
And sending an economic report up to Congress last week which says that we're going to create 2.6 million new jobs, which they backed off immediately, and four pages that system we should send our jobs overseas is not a Bush economic plan. And that's why we're in very good shape today. George Bush's reelect is down. Democrats are doing great. We're close to getting a nominee. But everybody is unified. We got to get rid of George Bush.
DOBBS: Terry, I quite understand your mission. But, also, the Democrats and Republicans, it seems at least to me, bear equal responsibility for the shambles in which we find Social Security in this country. It's been long delayed, long deferred.
The president has said that he does not want to deal with this issue in this election year. The Democratic candidates had, if you will, a reflexive statement today, but really nothing of substance. Do you think there's any possibility that the Democratic Party can take the lead and say they do want to deal with this and move legislation to address the issue?
MCAULIFFE: Well, as much as I love you, Lou, I've got to disagree with you.
I just remind you of the eight great years we had under the Clinton/Gore administration, when they added about 28 years to the financial solvency of Social Security, really added funds to protect it for many years to come. With George Bush, with his reckless tax cuts to the top 1 percent, the gigantic deficit that we now have in our country, a $10 trillion shift under George Bush, you get a Democratic as president, and all the viewers go out there and we put a Democrat in office, I'll tell you, we'll go back to creating jobs, we'll go back to creating surpluses in this country.
George Bush has no plan. All he keeps saying is, let's make the tax cuts to the top 1 percent. All we're doing is making this deficit bigger and bigger. Our kids are going to have to pay for this, Lou. My five children are going to have to worry about this deficit. It's time to take some serious action, create jobs. And George Bush has to get his head out of a hole and realize what is going on in this country. And we have got to get this country back to work again.
DOBBS: You're saying you don't want to deal with it either during this current year?
MCAULIFFE: Well, I mean, Lou, I will give you reality. We don't control the United States House. We don't control the United States Senate. We don't control the White House.
This is George Bush and the Republican Party government, no ifs, ands or buts. We're in this mess because of the Republicans. You put a Democrat back in control in the White House and in the House and the Senate, we'll go back to job creation. We'll be going back to surpluses. Bill Clinton added years to the financial solvency of Social Security under his presidency.
George Bush's presidency, the only thing you can see now is he has put Social Security in a crisis situation. He has underfunded education, underfunded health care, unfunded mandates on homeland security. He has not made us safer. And these are the issues of what this election is all about, Lou.
DOBBS: Terry McAuliffe, thanks for being with us.
MCAULIFFE: Great to be with us. Thank you.
DOBBS: We wanted to share with you a cartoon that caught our attention here. It is on the subject of outsourcing and the Bush administration support of exporting work overseas, as expressed by Chairman of Council Economic Advisers Greg Mankiw.
The cartoon reads, "For a defense of administration policy that outsourcing U.S. jobs is good, we go now to Bangalore, India, to a White House spokesman named Ravi Singh Jai (ph)." Thanks to cartoonist Mike Luckovich at "The Atlanta Journal-Constitution," who was kind enough to share his work with you and us.
Just ahead, the battle against the outsourcing of American jobs is sweeping through state legislators. Pennsylvania the latest state to join the battle. We'll have a report for you.
And our series of special reports, "Failing Grades," tonight focusing on No Child Left Behind.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: It's going to leave a lot of children behind. It is going to work the hardest handicaps on the poorest children simply by the underfunding and the punishment mechanisms.
(END VIDEO CLIP)
DOBBS: The cornerstone of President Bush's domestic agenda. We'll bring you a report card two years later.
And the very passionate debate about "The Passion of the Christ." We'll hear from three religious leaders who have three different views of this controversial movie.
(COMMERCIAL BREAK)
DOBBS: Pennsylvania has joined the list of states lining up to ban the overseas outsourcing of state contracts. A bill was recently introduced that would penalize companies that ship American jobs overseas.
Bill Tucker reports.
(BEGIN VIDEOTAPE)
UNIDENTIFIED MALE: Thirty thousand jobs in the last 2 1/2 years have been wiped out.
BILL TUCKER, CNN CORRESPONDENT (voice-over): Declaring outsourcing a threat to the future of Pennsylvania, a bill has been introduced in the state legislature. It is among the toughest in the country. If approved, the bill would not allow state or local contracts to be awarded to companies that would outsource the work.
It would require companies to disclose if they outsource more than 100 jobs to a foreign country. And if a company does outsource more than 100 jobs, it would be precluded from receiving any state aid or state and local contracts for seven years. In the words of one legislator, Pennsylvania is bleeding jobs, the taste is bitter, and he says support for an anti-outsourcing bill is strongly bipartisan.
MCGEEHAN: The jobs that were lost in steel and the jobs that were lost in textiles, we retrained them for I.T. jobs. They are being displaced a second time in their lifetime. That's obscene. That's wrong. And I think the legislature in Pennsylvania is going to stand up and say, enough is enough. TUCKER: The issue of disclosure is also gaining attention from legislators in Florida. Two years ago, the state awarded a $280 million contract to Convergys, which freely admits it outsources work to India.
UNIDENTIFIED MALE: Those firms should not do business with the state of Florida if they're willing to privatize their work force out of this country. If they want the benefit of taxpayer dollars, then they ought to keep the jobs here. I think it's only fair.
TUCKER: Convergys responds by saying, it created jobs in Florida.
(END VIDEOTAPE)
TUCKER: Six hundred jobs, to be exact. And the company says that all of those jobs went to Florida residents, as required by the contract -- Lou.
DOBBS: The issue in Pennsylvania is becoming critical, obviously.
TUCKER: Yes.
DOBBS: I talked with Congressman John Peterson today. In that state's -- most of that state's delegation is wrestling with this issue, trying to come to terms in a state that has been buffeted by the loss of manufacturing jobs, high value jobs, as well. Thank you very much, Bill.
Outsourcing is at the heart of tonight's face off. Joining us now, Congressman Dan Burton of Indiana. Congressman Burton says outsourcing poses a threat to our national security.
On the other side of this issue is Adam Kolawa, the co-founder, the CEO of the software company Parasoft who says the benefits of outsourcing far outweigh the negatives.
Welcome to you both. Thanks for being here to discuss this issue which is not only controversial, but is complex as think as any of us would like it to be.
Adam, let me turn to you first. The idea that we have lost hundreds of thousands of jobs in the past year, that we are projected by one study, the UC Berkeley study, to have 14 million jobs at risk here to outsourcing, how do you see that contributing to anything at all for working men and women in this country contributing to high value jobs?
ADAM KOLAWA, CHMN, CEO PARASOFT CORP: Well, you know, I would like to talk only about outsourcing in the software industry, because that's what I really know. There is a lot of outsourcing which is happening in other sectors, which is telecom and things like that. And I don't want to talk about that.
Let me give you a scenario how outsourcing really works for me and how it works in the software industry. Imagine that you have a company and you are running this company. And you need to make a payroll every month or every 2 weeks. Now you are running out of money or you are need to really make your company profitable.
What you do is you are trying to make sure you can reduce you costs. One way to reduce the cost is outsource part of the work force you have. And let's say you outsource 20 percent of your work force. Let's say that you didn't outsource and you failed. What is better to do? Is it better to fail as the company and 60 percent of your employees would stay or 80 percent which stayed don't have jobs anymore? What would you say to that?
DOBBS: You're asking me?
KOLAWA: Right, because that is the question I think politicians have to answer.
DOBBS: I think the question would be why in the world would you be in a business which you could not work indigenously to the economy? And if it's important to you -- are you an international company?
KOLAWA: I am international.
DOBBS: Are you putting those jobs overseas in order to be near a market and drive product in that market?
KOLAWA: No, I mean at the beginning...
DOBBS: Then I think you are outsourcing and I think you are ultimately going to export both your knowledge base within your company, your intellectual property and you are going to -- you're forestalling the inevitable.
Because if your only advantage is on cost of labor, I don't think you've got much of an opportunity strategically and you are going to get outthought, outmaneuvered and outhustled by foreign competition.
KOLAWA: OK. Now if we continue. OK, what's happening is...
DOBBS: Let me bring in Congressman Burton here. Congressman Burton's state, the largest number of manufacturing operations in the country, in the state of Indiana. We've lost 2.6 million, is it generally agreed upon estimate of the number of jobs we've lost over the last three years. Your party, your president, has basically embraced the idea of outsourcing, has presided over this -- this flood, this torrent of jobs that have left the country. Your feeling, sir?
REP. (R) INDIANA: First of all, let me say, Lou that the president has done some things that I think have helped stem the tide, so to speak, of the loss of jobs going overseas with the tax cuts and the incentives that the administration has pushed through the Congress. But after saying that, we have lost 2.5 to 3 million manufacturing jobs that probably aren't going to come back to the United States. We're losing as many as 20,000 job as month so a lot needs to be done. We need to have regulations in this country regarding small business change. We need more tax cuts for business, which would create an incentive for them to be able to stay here. And then we need to deal with our foreign trading partners, much more severely. The value of the currency in China is 40 to 50 percent underfunded which gives them a tremendous advantage in trade. And as a result they have $120 billion surplus right now.
DOBBS: Let me turn to you now, Adam. In answering your question, as best and as honestly as I could, what you are -- is your reaction to that?
KOLAWA: Well, what I think is we are politicizing the issue which is really a matter of industry maturing and I think outsourcing is the part of maturing process which industry is going through. Every industry went through this process and we need to go through this process.
DOBBS: I'm sorry, who went through this process?
KOLAWA: Every other industry which is a mature industry went through a similar process of outsourcing.
DOBBS: No, sir, no, sir. No, no, if I may say just straight out.
KOLAWA: OK.
DOBBS: The fact of the matter is, that we have seen outsourcing accelerated at unprecedented level in high value jobs primarily in technology and very high value jobs. It's never happened before in history.
The second part of that statement is not to suggest, I hope, that we should just accept it as if we're some sort of indifferent idiots what is happening to working men and women in this country and allow you or any other company doing business in this country and internationally to do what you wish irrespective of its impact on our society.
KOLAWA: I really disagree with this and I respectfully disagree with this. What we think we are building the jobs and let me tell you how. What we are building, is because we are able to reduce the cost and because we are able to outsource the tasks which are really not critical for our development as the company, we are able to use that manpower which we have to create much better focus and much better products to...
DOBBS: So now you are outsourcing because it is not simply cheaper labor and not cheaper as you first stated but now because you're innovating and creating new products?
KOLAWA: No, what I am saying to you I am trying to continue the scenario in how it is really helping us. OK, and what would happen is because you free your work force from work which is really not creative the work can produce new intellectual property and it can actually build better products. Now the better products can be used to get the company produce...
DOBBS: Adam, you make it sound now as if you are outsourcing and taking American jobs away as a matter of convenience to your other employees to free them up for innovation. In point of fact, in software in this country, the 25 percent of that work is being done, by some estimates, overseas that work could be done here, as well. And I'm not sure I -- I can tell you quite, clearly I don't grasp, why you think it should be your prerogative with a U.S. based company to simply export labor? Why should we not be able, competitively, to constrain companies such as yours?
KOLAWA: We are not exporting labor, we are specializing. And that's the process, specialization. In the software industry...
DOBBS: I have to turn to Congressman Burton for a conclusion here. Congressman, you are somewhat at odds with your own party and leadership in the White House. What do you think needs to be done?
BURTON: First of all, our trade agreements should be bilateral. We should be hard-nosed with our trading partners. China, for instance, which has the biggest trade surplus in the world with us should be taken to task because they have under valued their currency and as a result they entice people, like this gentlemen, to send jobs overseas.
Our industrial base is jeopardized. If we ever have to go to war again like we did in World War II we're going to have a real problem, because our industrial base is being eroded along with our jobs. We need to change that so we're safe militarily, No. 1, and we're protecting American jobs.
I believe in free trade, but I also believe in fair trade. And that means we need to negotiate very hard with our trading partners and the multilateral trade agreements like NAFTA simply don't work.
DOBBS: Just a concluding thought, if I may react, Adam, and Congressman, the idea that these jobs are being exported overseas, whether it be to Eastern Europe, whether it be to India, whether it be to China, the fact that we're running a half trillion dollar trade deficit in this country, does it amuse either of you? Do either of you grasp the irony that we sort of put it down into a free trade, so this mindless mantra of free trade while our trading partners understand this is not -- anything other than a zero sum game. That they have a strategy, that they have an approach, and they have a plan while we keep saying we're not responsible. Just an adjunct to free trade? Adam, your thoughts?
KOLAWA: Well, I don't think so. I think we are developing our organization.
DOBBS: You think it's serendipity?
KOLAWA: I really think it is a political issue which people are using this to get political votes instead of thinking how their business needs to be done. DOBBS: I am going to have to call it there and I thank you both for being here. Adam, Congressman, thank you very much, gentlemen, for being here.
Coming up next, a violent new movie about the final hours of the life of Jesus Christ. Critics say that it could deeply hurt relations between Christians and Jews. We'll be talking with three religious leaders, Father Jim Martin, Rabbi Adam Minsk and a Pastor Kevin Jonas next.
And later our special report, failing grades, a government program designed to save our schools could be doing more harm than good. That and a great deal more still ahead. As always, please stay with us.
(COMMERCIAL BREAK)
DOBBS: Mel Gibson's "The Passion of the Christ" opened today to sold- out audiences all across the country. This film depicts the final hours of Jesus' life, as if you didn't know what this film was about, and it has been panned by many critics who say it is not historically accurate, simply too violent and it creates divisions between Christians and Jews.
Joining us now to talk about this movie is Father Jim Martin, good to have you here. And Pastor Kevin Jonas, good to have you here. And Rabbi Adam Mintz. Good to have you with us.
This movie is, at least in my memory, is the most controversial film I've ever heard of. I don't know how much of that is -- springs true and spontaneously from the culture we're in and how much of it is hype. Did you like the movie?
FATHER JAMES MARTIN, ASSOCIATE EDITOR, "AMERICA MAGAZINE": I didn't. I think while there are a lot of parts I found very moving I thought some parts were somewhat anti-Semitic and I thought the violence was way over the top for this kind of movie.
DOBBS: You thought it was anti-semitic which is the principle charge against it from a Catholic priest that is -- that's a serious charge.
MARTIN: Well, in parts, it was anti-Semitic. I thought the way that Pilate was portrayed vis-a-vis Pontius Pilate who I think Mel Gibson sort of let off the hook. Pilate was a very brutal governor of Jerusalem at the time. And I thought in contrast (UNINTELLIGIBLE) came off as this villain. And I think that's a very irresponsible way...
DOBBS: (UNINTELLIGIBLE) is whom?
MARTIN: He's the high priest at the time that Jesus is around.
DOBBS: Let me turn to you, pastor. Your thoughts?
REV. KEVIN JONAS, PASTOR, WYCKOFF ASSEMBLY: I thought it was a powerful movie. It was difficult to watch because of the violence, but it was an incredible display of love and I felt like it showed the Jewish people, compassionate especially the people in the crowd. There were numerous instances of people showing compassion in torment over what Christ was going through.
DOBBS: Jewish people.
JONAS: Jewish people in the crowd. Including carrying the cross, the giving of water, of course, he was surrounded by Jews, his believers, his mother, Mary, John, his followers were with him and they were also Jew. He was a Jew.
DOBBS: The only people not Jewish would be the Romans themselves, correct?
JONAS: The Romans were the only parties that were involved in this story and I believe it was accurate out of the gospels with few artistic deviations.
DOBBS: Rabbi, your thoughts?
RABBI ADAM MINTZ, LINCOLN SQUARE SYNAGOGUE: As a movie-goer, a movie lover, I found the movie much too violent. Violent, gory, very difficult to watch. I can't remember the last time I looked at my watch so many times during a two-hour movie.
DOBBS: The fact that it's not in English, did that contribute to the clock watching?
MINTZ: No question about that. Not only sit not in English but it's in an ancient language that really sounds like gibberish and even for people who know Hebrew it was very difficult language to make out anything.
DOBBS: The anti-Semitic charge, do you give it validity?
MINTZ: I felt at least one scene was very much anti-Jewish. The scene of a Jewish mob, a large Jewish group in this square and they are the ones who were screaming, crucify him! And the Roman governor, Pilate is seen almost as weakling as if he is being pushed by the Jews.
DOBBS: Is that not within the creative license? I don't know what is going through Mel Gibson's mind and I can't imagine what his motives were, they are obviously powerful and apparently sincere attempt artistically to express his religious faith and precepts. He maintains steadfastly he is not being anti-Semitic. Is this far too much criticism, Father, to lay on an artist who has chosen to deal with a controversial topic. In any case?
MARTIN: Well, I think his intent is sincere. We have to give him the benefit of the doubt. The final product is another story. I think that while he did not -- I'm sure he did not intend to make an anti-Semitic film, his selection of which gospel passages he chose I think contributed to this picture of the Jews as primarily responsible for Christ's death. So it's not enough to just say it's in the gospels, it's which gospels do you pick?
DOBBS: I take it that you consider the anti-Semitism of the movie somewhat more strongly than the Rabbi. You feel it somewhat more broader.
MARTIN: I think the Catholic church worked very hard to prevent some of these passion plays from becoming anti-Semitic. I think he stepped into a lot of the traps, unfortunately. One of the biggest traps is letting Pilate off the hook, which I think he does in the movie. Pilate comes across as very thoughtful, persuasive character
DOBBS: Your thoughts?
JONAS: The image he is speaking of is directly out of the gospels. To leave a segment of the gospels out is to leave a segment of our faith. For those of us that believe that the Bible is sincere, that the Bible is accurate, that the Bible is to be believed literally, to remove one -- to remove one verse, to remove one line, to remove one image is to forsake that segment of your faith.
DOBBS: You're not accusing Mel Gibson of doing that simply because as an artist he had to do so?
JONAS: No, I'm saying he left it in. The accusation here is including crucify him, in the picture, is anti-Semitic and it's not. The Bible that I read was written by Jews. I serve a God that was Jewish. And that Jewish faith, we don't consider ourselves separate from but grafted in.
DOBBS: Rabbi, you get the last word.
MINTZ: I would -- I can't say what Mel Gibson intended but I think the question is not so much his intention but what the result is going to be. If people come out of the movie with an impression from that scene that you discussed as being anti-Jewish, as if the Jews were unnecessarily violent or cruel toward Jesus, I think for that Mel Gibson would have to answer and we would have to be able to address that issue, as well.
DOBBS: We are literally out of time but I just have to ask this. Did this movie in any way disturb or enhance your personal religious beliefs?
MARTIN: Well, it was very emotional to watch it. As some points I could feel myself entering the story. But I think it exempted the story so much from the ministry and the resurrection as to be almost meaningless.
DOBBS: Pastor Jonas?
JONAS: It greatly influenced my faith. Encouraged me and the images will affect me for the rest of my life.
MINTZ: Troubled me. And if anything, it made me go back and try to understand the story of the last 12 hours of Jesus more thoroughly. DOBBS: I can't help but think as we're wrapping up here, and I thank you all three of you being here, this is creating a discussion broadly about religion and faith that otherwise would not have been, I think I'm perhaps prejudiced always in the favor of the artist. But it even has wayward fellows like me thinking about it and talking about it. We thank you very much for the opportunity.
A reminder now to vote in our poll tonight. Are you planning to see "The Passion of the Christ?" Yes or no." Cast your vote at CNN.com/lou. We'll have the results for you in just a few minutes.
Coming up next, it was supposed to be leave no child behind. But some teachers say that law is leaving too many students in schools far behind. Our series of "Special Reports" this week, failing grades, education in America continues next.
(COMMERCIAL BREAK)
DOBBS: Our special report, "Failing Grades," education in America tonight, No Child Left Behind, one of the most far reaching attempts at education reform. But many educators say it is simply expensive, confusing, and desperately underfunded at the same time. The once popular law is now a growing controversy over the state of education in this country.
Peter Viles reports.
(BEGIN VIDEOTAPE)
PETER VILES, CNN CORRESPONDENT (voice-over): Born two years ago with bipartisan support the No Child Left Behind law is now suffering growing pains.
UNIDENTIFIED FEMALE: Put the reading journals back into the basket.
VILES: Critics from Vermont to Utah say it's a mandate without the money to pay for it. It labels hundreds of schools of failing based on a confusing thousand page law which contains no national standard but plenty of national rules.
WILLIAM MATHIS, SUPERINTENDENT, RUTLAND NORTHEAST DIST: It's going to have the opposite effect. It's going to leave a lot of children behind. It's going to work the hardest handicaps on the poorest children simply by the underfunding and the punishment mechanism. So, I think it's harmful.
VILES: Behind the criticism, nobody likes to be told that their school is failing. Leicester Central school in Vermont is a rural school with 75 kids that failed by a whisker to meet Vermont's relatively high standards.
CAROL ECKELS, PRINCIPAL LEICESTER CENTRAL SCHOOL: When we made the list it was devastating to the staff.
LAURA CORO, FOURTH GRADE TEACHER, LEICESTER CENTRAL SCHOOL: I'll never forget the day. The principle called a special meeting we were like, wow, what is going on. And we came in here and we all sat down and she told us we had a check mark. That we were a failing school and I was mortified.
VILES: The president has time and again defended the idea of testing and holding schools accountable.
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: I have heard every excuse in the book about measurement. You are testing too much, you are teaching the test. Don't test. If you don't test you have a system that just shuffles the kids through, and that's unacceptable.
VILES: The Department of Education has not yet released national data on how many American schools are making good progress and how many are failing. And whether the law is fully funded or not it is expensive. Federal education spending has rocketed 55 percent in three years to $36 billion last year.
(END VIDEOTAPE)
VILES: And critics say that's not enough. Senator Ted Kennedy argues the administration has underfunded this law by $9 billion in the coming year. The administration says fund something adequate and that in fact billions of dollars have sat unused in the Federal Treasury because states didn't always claim them on time.
DOBBS: At the end of the day, it just isn't working and it's not working for too many kids. The Department of Education doesn't seem to be getting it done.
VILES: Well, they are at a bit of a disadvantage, because this is really a ten or 11 year project for this law to run its course. It's being attacked now in the first and second year. Senator Kennedy has said that he is at a crossroads on this whether or not to introduce legislation to change it.
DOBBS: And we'll be talking to Senator Kennedy, on the subject of education later this week.
Pete, thank you very much.
On Wall Street, stocks ended what was a five session losing streak. The Dow gaining 357 points. The Nasdaq up 17. The S&P up almost five.
New trouble tonight for Disney chief Michael Eisner. Christine Romans here with the report, Christine.
CHRISTINE ROMANS, CNN CORRESPONDENT: This country's largest pension fund says it has lost confidence in Michael Eisner, Lou. CALper says it can not support Eisner, and the company's performance over the past five years has been dismal. And an individual adviser Glass Lewis, also recommends voting against Eisner and two board members. It says the Disney board has been notoriously insular, famously gullible and blindly loyal to Mr. Eisner." The firm said yes, the board has made progress towards independence but just not enough.
Also, a peek this week into the paycheck of some of Wall Street's titans. Goldman Sach's CEO Hank Paulson pay check doubled last year, Lou. He received 21 million in restricted stock on top of 600,000 salary, even has Goldman grappled with regulators on several front.
At JP Morgan William Harrison made 20 million last year.
His merger partner Jamie Dimon of Bank One got 19 million.
And Cendant's CEO fared even better, 23 million for Henry Silverman and he exercised $37 million in stock option. A good time if you're a CEO, and AT&T announcing it's going to cut another 8 percent of its work force, 4,600 workers, fired 18,000 last year.
DOBBS: Thank you, Christine.
Coming up next, the results of our poll and a reminder to check our Web site for the complete list of the companies we've confirmed to be "Exporting America." Cnn.com/lou. We'll continue in a moment, stay with
(COMMERCIAL BREAK)
DOBBS: Now the results of "Tonight's Poll." Forty-three percent of you plan on seeing the movie "Passion of Christ," 57 percent do not.
That's our show for tonight. We thank you for being with us.
Tomorrow Senator Ted Kennedy joins us to talk about the education crisis and how to fix it. And a trade war brewing between the United States and Europe. I'll be talking with European Union trade commissioner Pascal Lamy. He'll be with us, we you are as well.
For all of us here good night from New York. "ANDERSON COOPER" is next.
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Threatened By Outsourcing>
