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Lou Dobbs Tonight

President Bush Defends Economic Policy; E-Democracy

Aired March 10, 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: President Bush says critics of his economic policies are defeatists.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: We'll prove the pessimists wrong again.

DOBBS: Controversy over electronic voting. Today, two leading senators demand paper records for touch-screen machines.

SEN. HILLARY CLINTON (D), NEW YORK: We have to restore trust in our voting and we have to do it now.

DOBBS: E-democracy in our "Face-Off" tonight. The marketing director of Diebold and a security expert with two very different views on e-voting.

The export of American jobs could turn the United States into a Third World country, so says economist Paul Craig Roberts. He's our guest.

And the power struggle in the Sierra Club, America's oldest environmental group struggling with immigration and population growth. I'll be joined by former Colorado Governor Richard Lamm, running for the Sierra Club's board of directors.

(END VIDEOTAPE)

ANNOUNCER: This is LOU DOBBS TONIGHT for Wednesday, March 10. Here now for an hour of news, debate and opinion, Lou Dobbs.

DOBBS: Good evening.

President Bush today struck back at unnamed critics of his economic policies. The president said his opponents have a tired, defeatist mind-set. President Bush said economic isolationism, as he termed it, would lead to retaliation from other countries, retaliation that would cost American jobs.

But the president made not mention of this country's growing trade deficit. The trade deficit rose to a record $43 billion in January, as Americans bought huge quantities of foreign-made goods.

Senior White House correspondent John King reports -- John.

JOHN KING, CNN SR. WHITE HOUSE CORRESPONDENT: And, Lou, the president making that aggressive defense of his approach today in one of the state's hardest hit by the decline in the manufacturing sector, Ohio, one of the places where the debate over outsourcing U.S. jobs to cheap overseas labor markets is most emotional.

You see the president here. He's touring a factory that exports 60 percent of its products. The president used that factory tour to make his very assertive case that free and fair trade, as he calls it, is part of the solution in a difficult jobs market, not part of the problem, as many of his critics say.

Now, as the president made his way through Ohio, he is mindful of the fact that no Republican has won the White House without carrying that very critical state, the president saying those who say trade is bad or that want to erect what the president calls protectionist barriers, the president says they do not understand the global economy.

(BEGIN VIDEO CLIP)

BUSH: One in five factory jobs in this country directly depends on trade. The surest way to threaten those jobs is a policy of economic isolation. The surest way to add more jobs is a confident policy, a confident economic policy that trades with the world.

(END VIDEO CLIP)

KING: Now, the president never mentioned his Democratic opponent, Senator John Kerry by name, but aides say he had Senator Kerry in mind. Senator Kerry supported NAFTA. He supported trade preferential treatment for China. But he now says, if elected, he would review all major trade agreements.

The White House says that is protectionist. Senator Kerry also would repeal some of the Bush tax cuts. The White House says that would damage the economy. The president addressed that directly today.

(BEGIN VIDEO CLIP)

BUSH: That old policy of tax and spend is the enemy of job creation. The old policy of economic isolationism is a recipe for economic disaster.

(END VIDEO CLIP)

KING: It is a tough sell for the president. In Ohio, the unemployment rate is 6.2 percent. Again, 160,000 manufacturing jobs lost during the Bush presidency.

And as the president made his case in Ohio, today, Lou, word back here at the White House that, five months after the president promised to name a so-called manufacturing czar, the administration has settled on a Nebraska businessman for that post. Tony Raimondo will be announced soon, by the White House, we are told. He is an outspoken advocate of free trade. Senator Kerry says this is too little, too late. Senator Kerry also says, in his word, one more government bureaucrat cannot make up for the loss of 2.5 million manufacturing jobs -- Lou.

DOBBS: John, I think we all have to be curious. The president for a second day has talked about economic isolationism. Who is he referring to? Is there anyone calling for economic isolationism?

KING: Well, the administration says that Senator Kerry is trying to have it both ways on trade. Again, Senator Kerry voted for NAFTA. He voted for China's preferential trade status. He now says he would review trade agreements and he would possibly try to amend those trade agreements.

So that is one reason, because the senator has a mixed record on this. The White House did not mention him by name, but they says he certainly had him in mind. But, again, Senator Kerry saying he's no protectionist. He simply wants a fair deal for U.S. workers. Look for eight more months of this debate, Lou.

DOBBS: Again, I have got to press the point a bit, John, if I may, because the term economic isolationist suggests putting fences around the country, around our borders. John Kerry, no one else in public life that I know of, has made such a request.

KING: And that is part of the rebuttal that you hear from the Kerry campaign to the president's remarks today.

What the president says is, if you put those trade agreements back on the table, if you even say you are going to reconsider NAFTA, you're going to reconsider the trade agreement with China -- Senator Kerry has said he opposes the Free Trade Agreement of the Americas, a proposal making its way through the Congress now.

The White House says that even at the suggestion of reviewing those trade agreements, that foreign competitors would retaliate against the United States. Now, as you are making the point, many of this president's critics say that's an unfair criticism.

DOBBS: John, thank you very much -- John King, our senior White House correspondent.

During his speech in Ohio today, President Bush made a point of emphasizing the contribution of the Honda Motor Company to the state and national economy. President Bush said 16,000 Americans work for Honda in Ohio. Honda hired those workers to gain access to the world's biggest consumer car market. And the company's profits go straight back to Japan.

Bill Tucker reports.

(BEGIN VIDEOTAPE)

BILL TUCKER, CNN CORRESPONDENT (voice-over): Speaking in Cleveland, Ohio, President Bush made an interesting claim. BUSH: Foreign companies recognize the quality of American workers and that is one of the reasons why so many have chosen to locate plants in our country.

TUCKER: The quality of American workers is not in question. But that's not why many foreign automakers have plants in the United States.

ALAN TONELSON, U.S. BUSINESS & INDUSTRY COUNCIL: No, no, and they are not here because of free trade and globalization, either. The United States imposed quotas on all foreign automobile imports. We basically said jump. They said, how high? And they did exactly what the U.S. government wanted them to do.

TUCKER: The policy was imposed in the early '80s and it has worked wonders. Foreign automakers now have plants and joint ventures in 11 states. There are plants in Michigan, California, Illinois. And those employ United Auto Workers. Plants in South Carolina, Alabama, Ohio, Tennessee, Mississippi, Indiana, Kentucky, and a soon- to-open Toyota plant in Texas all will be non-union.

Sounds great, right? Well, not everyone thinks so. After all, we're granting access to our markets and those companies are taking the profits away.

REP. MARCY KAPTUR (D), OHIO: It's as though they are siphoning off some of our wealth -- and they are -- and we're getting nothing for it in their homelands. That's why I think these trade agreements have to be amended, why, with every nation where we have a deficit, we ought to have major trade negotiations under way either to open their markets or to stop playing like Uncle Sap.

TUCKER: But instead of recognizing its economic power, the United States seems reluctant to use it.

(END VIDEOTAPE)

TUCKER: And, meanwhile, the big three become the big two, with Ford and General Motors the only domestic automakers left. And in the process, the Motor Vehicle Manufacturers of America become, well, the more global-sounding Alliance of Automobile Manufacturers -- Lou.

DOBBS: Politics and economics.

TUCKER: You betcha.

DOBBS: Bill, thank you very much -- Bill Tucker.

Senator Kerry also on the offensive tonight, this time against the president's tax policies. In a campaign stop in Chicago, Senator Kerry called for bigger tax cuts for middle-class Americans, but tax increases for those who make more than $200,000 a year. Senator Kerry also criticized President Bush's record on job creation.

(BEGIN VIDEO CLIP) SEN. JOHN KERRY (D-MA), PRESIDENTIAL CANDIDATE: George Bush thinks exporting our jobs is good economic policy. I believe that creating jobs here in America, keeping good jobs here, and exporting goods is good for our economy.

(END VIDEO CLIP)

DOBBS: Later in the day, Senator Kerry met with former rival Howard Dean. Senator Kerry hopes to win over Governor Dean's supporters and donors, but Dean has not yet officially endorsed Kerry.

A new offensive tonight in the campaign advertising wars. President Bush's reelection campaign has filed a complaint with the Federal Election Commission over a new Media Fund ad. The $5 million advertisement running in 17 states accuses President Bush of -- quote -- "eroding the American dream" -- end quote. The Bush-Cheney team said Media Fund paid for it using what are called soft money donations, which would violate new campaign finance laws. Media Fund says the charges are baseless.

Meanwhile, a group of gay Republicans who supported President Bush four years ago launched their own campaign against him. The Log Cabin Republicans' ad shows Vice President Cheney supporting gay rights during a debate in 2000. The ad calls on the White House to drop its support for a constitutional amendment banning gay marriage.

Joining us now on these campaign ad wars, "Los Angeles Times" national political correspondent Ron Brownstein, senior CNN political analyst Bill Schneider, both in Washington tonight.

Let me turn to you first, Ron.

The ads, so-called 527 ads, soft money and lots of it in support of Kerry and against Bush, will it stand up?

RON BROWNSTEIN, CNN POLITICAL ANALYST: That is an open question, Lou.

The Federal Election Commission is now in the middle of a rule- making that will really decide what will happen to these committees. Very quickly, basically what we're seeing is the outsourcing, to use a word much in the news these days, of many of the activities that used to be done at the Democratic National Committee, both issue advertising, campaign advertising in support of the nominee, and also grassroots organizing in support of the nominee.

With McCain-Feingold, the campaign finance reform law, the national parties can no longer accept soft money. So Democrats created these parallel groups which are taking the same contributions that used to go to the parties and doing the same things. The FEC is going to tell us later this spring whether they can do so through the election.

DOBBS: Bill, what's the problem of making a determination? These are 527s. Rob Glaser, George Soros two of the principal sources of money for those campaigns, both have said that they are going after George Bush. Doesn't that take them out of the category that would be defensible before the FEC.

WILLIAM SCHNEIDER, CNN SR. POLITICAL ANALYST: Well, they seem to be trying to influence a federal election. It sounds like electioneering.

If they are electioneering using the ads, they are supposed to form a political committee, which is then supposed to be registered. It's supposed to have limited and regulated contributions, rather than these totally unlimited, unregulated soft money contributions that they can spend as much of as they wish without divulging the name of their contributors.

They are supposed to be subject to the federal campaign finance laws. They claim, well, they are not explicitly advocating voting for Bush -- or against Bush, voting for Kerry, so they don't come under the rules, but that's a tough argument to make.

DOBBS: We have heard from Senator McCain, Ron, that he will sue to get enforcement under the campaign finance laws. We haven't heard from Senator Russ Feingold. Will we?

BROWNSTEIN: I don't know the answer to that question.

I do suspect that whatever happens, whatever the FEC decides, this is going to end up in the courts. This has become very important for a surprising reason, Lou, which I think would be surprising to many listeners, is that, over the last 20 years, the Democrats have been more dependent than the Republicans on the unlimited big-money contributions.

Republicans have an enormous advantage in the smaller -- quote -- "hard-dollar contributions." That is where Bush is raising this huge war chest. And the Democrats do rely on this. That's why you see this activity occurring on the Democratic side, not on the Republican side, where Bush is raising an unprecedented amount of money from relatively smaller contributions.

DOBBS: Bill, that sounds like an important political advantage that could be exploited by the Bush campaign, could it not?

SCHNEIDER: And they are indeed doing that.

The Democrats are in a very awkward position. The Democrats advocated -- most Democrats were strong advocates of campaign finance reform. And what they are doing right now is exploiting a loophole. Now, they justify that loophole by saying, well, they are just trying to level the playing field. President Bush has been so successful in raising money, they are trying to be equal with him, but they are doing it by exploiting a loophole.

DOBBS: Ron Brownstein, Bill Schneider, we thank you both. Imagine that, somebody in Washington trying to exploit a loophole.

(LAUGHTER)

DOBBS: Thank you, gentlemen. Still ahead here, President Bush wants to cut federal spending. Local police chiefs say budget cuts would limit their ability to fight crime.

New questions tonight about e-voting. The marketing director of one of the leading manufacturers of e-voting machines, Diebold, and a computer security expert who says there are big problems, they face off tonight.

And a leading economist who says the export of American jobs could turn the United States into a Third World country.

Economist Paul Craig Roberts is our guest.

Stay with us.

(COMMERCIAL BREAK)

DOBBS: Insurgents in Iraq killed two American civilians and an Iraqi working for the coalition provisional authority. They were shot today by men dressed in Iraqi police uniforms South of Baghdad. Coalition troops later arrested six people, including five wearing police uniforms.

U.S. Marines in Haiti have shot and killed another two gunmen. The Marine opened fire after those gunmen were fired shots at their patrol in the capital of Port-au-Prince. None of the Marines were wounded. U.S. Marines have killed four people in Haiti since they arrived at the beginning of this month.

Meanwhile, growing money concerns tonight from police forces all across the country. Police chiefs from cities are protesting massive proposed cuts to law enforcement programs. The Senate this week began debating the 2005 federal budget. It calls for $1.5 billion cut to law enforcement. Officials in one small city say those cuts could have a devastating impact on their ability to fight crime and terrorism.

Kelli Arena reports.

(BEGIN VIDEOTAPE)

KELLI ARENA, CNN JUSTICE CORRESPONDENT (voice-over): Plano, Texas, just outside Dallas, is home to about a quarter of a million people and to several major corporations, including J.C. Penney and Frito-Lay. The city's police chief says, as big cities increase defenses, it's even more important for smaller cities like Plano to be on guard.

GREG RUSHIN, PLANO POLICE CHIEF: I would think that terrorists could then go to somewhere where it isn't quite secure. And, of course, it could be another city, a city like Plano, Texas, for example.

ARENA: Plano's police department has already eliminated about 9 percent of its work force and the chief says proposed budget cuts would do even more damage.

RUSHIN: That sleeve coverage gives us some extra protection as well.

ARENA: The Bush administration wants to siphon about $1.5 billion from federal programs that directly help local police.

JOE POLISAR, PRESIDENT, INTERNATIONAL ASSOCIATION OF POLICE CHIEFS: Targeting these critical programs for reductions of this magnitude has the potential to significantly weaken the ability of state and local law enforcement agencies to protect our communities.

ARENA: The grants that are being cut pay for things like overtime or equipment like Plano's bomb-disarming robot.

(on camera): The administration argues, while some programs are being cut, overall, local governments are getting more federal dollars.

TOM RIDGE, HOMELAND SECURITY SECRETARY: There's been a huge infusion of additional dollars to first-responders, be they first- preventers, the law enforcement community, the first-responders, in the past three years.

ARENA: But because Plano is not identified as one of the top 50 terror targets, it won't benefit as much as New York or Washington. Plano police understand the distinction, but say they still have a job to do and can't without proper funding.

Kelli Arena, CNN, Washington.

(END VIDEOTAPE)

DOBBS: A prosecutor in New York City is taking legal action to stop what is at least an unusual stand by an inmate on Rikers Island. The prisoner has copyrighted his name and he's demanding half-a- million dollars every time his name is used in court.

Queen's district attorney, Richard Brown, has had enough. He has filed lawsuits in civil court to stop the scam. This is not the first time a prisoner has copyrighted his name. There have been at least three other cases in New York.

Well, the potential for a different kind of scam has proponents of electronic voting on the offensive. Experts on both sides of the e-voting debate face off next on voting it threatens or strengthens our democracy.

And then the influx of millions of illegal immigrants into this country has sparked a power struggle at the nation's oldest environmental group. Former Colorado Governor Richard Lamm, who is running for the board of the directors of the Sierra Club, is our guest tonight.

We'll have that and a great deal more. Please stay with us.

(COMMERCIAL BREAK)

DOBBS: More than 50 million of us are expected to vote on touch- screen voting machines in the general election this November. Those machines are so controversial that today two more lawmakers demanded that they be able to print paper records.

Kitty Pilgrim reports.

(BEGIN VIDEOTAPE)

KITTY PILGRIM, CNN CORRESPONDENT (voice-over): E-voting looks simple, but how do you know the machine hasn't been hacked? Senators Bob Graham and Hillary Clinton today called for legislation to create a paper trail for e-voting, saying the machines absolutely can be hacked.

CLINTON: People who are very knowledgeable about source codes and hacking and the like, for the fun of it, they've been, you know, talking about how easy it would to skew our elections. I don't think any of us want that.

PILGRIM: A litany of problems already turned up. In the Georgia primaries, smart cards were left unprogrammed. In California, ballots were sent to the wrong precincts. Maryland also had some of the wrong encoders for the machines.

DAN WALLACH, RICE UNIVERSITY: There have been problems where we have significantly more votes cast than there are voters living in that particular precinct.

A lot of these are software glitches. What we haven't seen evidence of yet, but it could certainly happen, is, we might actually, at some point, have somebody trying to corrupt an election and try to manipulate the results.

PILGRIM: Back in January, the state of Maryland hired a team of computer security experts to try to break into its e-voting machines. The team picked the lock on the voting bay in 10 seconds and found they could easily hack the software because the security upgrades from Microsoft had not been installed. That was in January. The primary was last week on Super Tuesday. Maryland election officials say they didn't have time to change the software or the locks before the primary, but they did put tamper-proof tape over the locks.

(END VIDEOTAPE)

PILGRIM: Now, security experts say no primary race was close enough that any e-voting glitches so far would have made a difference, but they do admit the systems are still vulnerable and new safeguards have to be put in place -- Lou.

DOBBS: Kitty, thank you very much -- Kitty Pilgrim.

We'll have much more on the e-voting controversy in our "Face- Off" segment tonight. And computer security expert Rebecca Mercuri and Mark Radke of Diebold Election Systems will be here to debate whether this country is ready for electronic voting. Ready for not, here comes November.

Plus, the country's oldest environmental group debating the impact of millions of illegal immigrants on our environment. Former Colorado Governor Richard Lamm is running for the Sierra Club board. He is our guest tonight.

And the exporting of America could turn this nation into a Third World country, according to economist Paul Craig Roberts. He's our guest tonight.

Stay with us.

(COMMERCIAL BREAK)

DOBBS: Tonight's "Face-Off" focuses on the controversy surrounding electronic voting.

Mark Radke is the director of marketing at Diebold Election Systems. He says the machines his company designs make it easier for voters to cast and verify their vote, joining us tonight from Cleveland, Ohio.

Good to have you here, Mark.

MARK RADKE, DIRECTOR OF MARKETING, DIEBOLD ELECTION SYSTEMS: Thank you.

DOBBS: Computer security expert Rebecca Mercuri disagrees, however. She says paperless e-voting machines gives voters no independent confirmation of their vote. She is a Harvard University research fellow and joins us tonight from Philadelphia.

Thanks for being here, Rebecca.

Let me begin first, Mark, with you. It appears that there were some problems with e-voting, some that would be, I guess, considered hardware or structural issues, others just simply people not yet being properly trained to do their jobs. Is your company prepared to say that they can absolutely deal with concerns about verification and providing an audit trail should a recount be required in any precinct or district or county or jurisdiction this fall?

RADKE: Lou, let me just mention, first of all, that, during Super Tuesday, Diebold had over 55,000 touch-screen voting stations deployed throughout all of Georgia, throughout Maryland, and in several counties within California. And to date, I have not heard of one security issue or any case of election fraud that has occurred.

If a recount is required, we do have the capability of going back and uploading the memory card of all the voting stations. And let me take a step back as well. Before any of the voting stations are deployed for any election, each and every voting station, touch-screen station, is tested. It goes through what is called logic and accuracy testing. And that testing requires a person within the jurisdiction to test the selections on the screen and then verify that the final result that is printed from the printed copy on the voting machine equals their selections.

(CROSSTALK)

DOBBS: Rebecca, are you reassured by Mark's...

REBECCA MERCURI, JOHN F. KENNEDY SCHOOL OF GOVERNMENT: No, not at all.

In fact, it's interesting that he should say they didn't have any problem in Georgia. There were some voters in Georgia who were only given the ballot for the flag. They were not allowed to vote. And, in fact, what they were told was, well, that's the ballot we gave you, so, even though that's the wrong ballot, too bad.

And voters in California were told the same thing, although not with his machines. And so, when they talk about there's this testing that's being performed, the testing really does not reflect the actual conditions on Election Day. And there's all sorts of things that go on behind the scene that we really don't ever really hear about.

As far as these paper -- when it prints out this paper after the fact, the voter doesn't get to see that. That's all done behind the scene. And the voter doesn't have any way of confirming that that ballot is actually the one that they really cast.

DOBBS: Mark?

RADKE: Lou, could I respond to that, please?

Yes, I would just like to say that the situation in Georgia, as an example, was a procedural issue. And it had nothing to do with the operation of the voting equipment. It was a situation where the voters -- in fact, I was in Georgia on Super Tuesday -- the voters could walk in and they could sign what's called a voter certificate. And if they signed a certificate which signed -- which was a nonpartisan certificate, they passed it over to the poll worker and that particular type of card was encoded for that voter.

The voter signed the wrong sheet. It was passed over to the poll worker. The collect ballot style was programmed based on that piece of paper and the machine worked 100 percent accurately.

DOBBS: Right. I want to show...

MERCURI: Well, look, I...

DOBBS: I'm sorry. Go ahead.

MERCURI: I have been a poll worker in Pennsylvania and in New Jersey. I'm also a computer scientist.

And when we would have that problem, where a voter would do the wrong thing then we were given an opportunity to correct that. We had a way of voiding that on the machine. They would step their head out of the machine and we would tell them, OK, we would void and we had a procedure for that. So, the fact that your machine doesn't allow the people to do that, or that you haven't implemented procedures in place in the various counties where your machines are being used is irresponsible.

RADKE: Rebecca, I'm going to correct you here because we do have a procedure that does allow a person who receives the wrong ballot, if it occurs to them during the voting process at that point in time they can notify a polling official so they can cancel the ballot at that time.

MERCURI: Well, those voters weren't given that chance.

DOBBS: May I share with you and obviously our viewers two views on this subject and I'd like you both to comment. We ask Deforest Soaries, who is, as you both know, the head of the Election Assistance Commission, if e-voting, in his judgment, was secure without a paper trail and this is his response if we could roll that, please.

(BEGIN VIDEO CLIP)

DEFOREST SOARIES, U.S. ELECTION ASSISTANCE COMM: We today have the capacity to have a virtually ever free elections with current set- up and the current standards that we implement.

(END VIDEO CLIP)

DOBBS: Now, that's reassuring and I presume, Mark, you agree with it?

RADKE: I do. Let me just mention, though, Lou that if the federal government and or states in particular, require a printed receipt for a voter or something that is dropped into a secure ballot box we certainly have the expertise and qualifications and technology to provide that solution. That is not a question whatsoever. And that can be retrofitted to all of our existing machines if that is a requirement.

Today, though, Lou, there are no standards or testing requirements for that type of a product. That is the issue.

DOBBS: That is a big part of the issue. And Rebecca, your thoughts on Mr. Soaries comments.

MERCURI: That is absolutely incorrect. Every election we have, thousand of votes go missing in all sorts of states. These numbers are very huge. In fact, in the Diebold machines themselves in the California recall election, some 5 percent of the votes were not cast overall.

They were not recorded and we have instances where thousands of votes just go missing and then this is blamed on the voters. They say well the voters deliberately went in and did not cast the ballots. The problem is we have no way of providing an independent audit of this. And the fact we don't have any standards is certainly not my fault. I have been talking about voter verified paper ballots since 1992.

So that fact that the industry has not stepped up to the plate to do this is certainly not my fault.

DOBBS: Legislators are beginning to step up as you both know. Senator Graham, Senator Clinton, both today advancing the issue. Let me ask you both to listen to this comment from Senator Clinton.

(BEGIN VIDEO CLIP)

SEN. HILLARY CLINTON, (D) NEW YORK: These security concerns have been inflamed by statements of people like Walden O'Dell, the CEO of Diebold, a major electronic voting machine manufacturer, who said, not once but several times, and in writing as well as verbally, that he would do anything to ensure that President Bush would be re-elected.

(END VIDEO CLIP)

DOBBS: Now, Mark, obviously that calls for some reaction from you from Diebold on the statements from your CEO and it's obviously the source of a great deal of concern amongst those who are looking to e-voting in relying on the machines from your company.

RADKE: I'd like to state a couple points on that issue. First of all, our CEO has outwardly expressed his regret that his business has been basically mixed with his personal preference in this situation. And he has gone to the media and expressed that very fact. He has also guaranteed a lower profile when it comes to political issues.

In addition to that, though, again, his operation or his position within the company does not affect the operation or the functionality of our voting machines whatsoever.

DOBBS: Rebecca, your thoughts?

MERCURI: Well, what we basically have turned over to is a system of what we call faith based voting, where essentially the companies are in control. Whenever we've had problems with this equipment, we were giving no opportunity to examine the codes. We're told it's all proprietary.

And basically there's no opportunity to verify that either the ballots that you cast or what you intended or the vote totals are actually correct. All this is controlled by the vendors, and in some cases the election community, but largely it's just turned over to the vendors and it's a proprietary nature.

This is unacceptable. We need checks and balances. We have government officials overseeing the elections and we should not have vendors running our elections.

DOBBS: Mark...

RADKE: I'd like to respond to that, if you would mind.

DOBBS: If you can do it in 15 seconds.

RADKE: You got it. Diebold has actually been -- our system been reviewed by four independent unbiased agencies looking for the security aspects of our equipment and it has passed those tests. There have been selected recommendations that have been done including in our software.

MERCURI: To the 1990 standards not to any current standards. And the Harvard standards don't yet exist. So it's unfortunate.

DOBBS: Rebecca, Mark...

RADKE: Actually, we have passed the 2000.

I'm sorry, Lou.

DOBBS: Please finish.

RADKE: I was going to mention our -- Rebecca let me finish, please. That our latest version of software has passed every 2002 federal election commission test.

MERCURI: That's not in use right now. Those are not the ones that are in use right now.

DOBBS: Rebecca, Mark, we thank you both. I hope you both will come back with us as this issue is obviously critically important to all of us here who are planning to cast a vote that counts in November. Mark, Rebecca, thank you.

MERCURI: Absolutely.

RADKE: Thank you, Lou.

DOBBS: When we continue, I'll be joined by Richard Lamm. The former governor of Colorado says the United States has been facing an immigration problem since the early '80s. He now wants this country's oldest environmental group to take the stand on the environmental issue of immigration, he says. He is our guest next. Please stay with us.

(COMMERCIAL BREAK)

DOBBS: A power struggle is under way tonight inside the nation's oldest environmental group, the Sierra Club. My guest tonight is running for the board of directors of the Sierra Club on the platform that immigration reform should be added to the clubs environmental agenda. He says the huge influx of legal immigrants as well as illegal into this country is threatening the environment and the very quality of life in America.

Richard Lamm served three terms as the governor of the state of Colorado. He's professor of public policy at the University of Denver joining us tonight from Denver. Good to have you with us.

RICHARD LAMM, FRM. GOV. OF COLORADO: Thank you.

DOBBS: You are being called a lot of names, as you well know. There is a firestorm of controversy about moving the Sierra Clubs in the direction of immigration as a concern for environmental protection. How is this going to end?

LAMM: Well, the club is using club funds now to fight us. And I think that it's -- they will probably win, because I think breaking their own club rules and their breaking the California corporate code.

But you know there's two fights here allow, Lou. You're right, one fight is the question of immigration and population, should it be an environmental issue. The second one is the way the people are doing it. I mean, they are calling us right wing racist. I have never run a campaign where this level of vituperdness (ph) has taken place. This is incredible.

DOBBS: I have talked with several people associated with -- who are obviously who work to make certain that we are aware of hate groups in this country, to make certain that we have some perspective on that. They raise some concern on groups that are supporting some members in the slate of candidates in the board. Are you at all associated with any group that could be construed of a hate group or a racist group.

LAMM: Lou, I'm a Democrat. You know, I came out of the liberal wing of the Democratic party. My first job out of law school was a civil rights attorney. My wife marched in Selma. This is just ridiculous stuff. I think as you know, and as you personally found out because of the courageous work you've done. I mean, immigration splits, you have "The Wall Street Journal," you've got Pat Buchanan on the right, you've got the were all one world there should be no borders. And then have you my environmental viewpoint that says ecosystem doesn't need 300 more million consumer Americans.

DOBBS: And you, some people may not recall you have written extensively on the issue of immigration as well as voicing your concern about the environment. In a nutshell, if we can do that on television news which is what we do every evening here, in a nutshell your concern about relating immigration controls and population growth to the environment.

LAMM: Lou, it just seems to me it's almost a matter of definition. Every environmental book, ecology book has population as part of it. You know, if I had a magic wand and wave it that I could have the Sierra Club win every battle it was fighting right now and for the next 50 years, yet they ignored a population. You still would not want to live in this country. No American I ever talked to wants to live in an America of a billion people or even half a billion people.

DOBBS: Which is the projection for the population of the United States by the end of the century. Current growth -- current population growth rates both natural birth and immigration.

LAMM: If I could leave anything carved over the capitol when I left, it would be something like beware of solutions that were appropriate to the past and disastrous to the future. Of course immigration has made this country, that doesn't mean, it was an empty continent when the Statue of Liberty went up. We've got to understand now that the environment in the United States with all the traffic and all of the air pollution and the water pollution, the consumption, we need actually to have an argument and a discussion about population. And the Sierra Club should be part of that.

DOBBS: We thank you for being here, Governor Lamm, we appreciate it. And I will be talking tomorrow with leadership of the Sierra Club opposing you for their views just so that everyone's views are expressed here. And we thank you very much. The president of the board of directors of the Sierra Club, Larry Fahn.

Thanks again, Governor Lamm.

LAMM: My pleasure.

DOBBS: That brings us to the topic of "Tonight's Poll." Do you believe illegal immigration and population growth are related to environmental concerns, yes or no.

Cast your vote at cnn.com/lou. We'll have the results coming up later in the show.

You when you continue, I'll be joined by economist Paul Craig Roberts. He says the case for free trade has simply collapsed. Stay with us.

(COMMERCIAL BREAK)

DOBBS: Tonight the results of the first national poll on outsourcing show the American public is very concerned about jobs being exported overseas, this poll also suggests the issue will play a significant part in the presidential election. According to a CNN/"USA Today"/Gallup poll, 61 percent of Americans are concerned they will loose their job to a foreign country, 38 percent says they are not concerned.

My next guest says concerns about the exporting of American are well founded. Economist Paul Craig Roberts says the shipments of American jobs could turn this country into a third world country. Paul Craig Roberts, served during the Reagan administration and is here with us tonight, good to have you here.

PAUL CRAIG ROBERTS, ECONOMIST: Thank you, Lou.

DOBBS: This has become a remarkable issue in a number of economists are simply ignoring the issue or saying that they don't want to deal with it at this particular time because there's not enough data.

What's your reaction?

ROBERTS: Well, you see they think it's the beneficial workings of free trade what it really is a labor arbitrage (ph), a substitution of cheap labor for expensive labor. This wasn't possible until recently. It took the collapse of world socialism. It took the rise of the high speed Internet. Now they have a chance to simply put skilled, cheap, foreign labor in the role that was filled by American labor. DOBBS: And within that -- there's a suggestion that if you are concerned about the American middle class, that you are really a trader of the precepts off free trade and sophisticated thought if there's any reason to be concerned about that. This economy, this country was built on a middle class who's jobs are being exported.

ROBERTS: Exactly. When you lose high value added jobs, you lose occupations. And we can already see the effect in enrollments. You know, this year, the enrollments in computer engineering jobs dropped 23 percent. In MIT announced the enrollment in the engineers has dropped 33 percent in the last two years.

And education. We are hearing from in particular the Bush administration, many private businessmen running public companies saying the issue is really just retrain everybody, everybody will be fine. Reeducate them for a new world.

How do you react?

ROBERTS: What you have to retrain them for is non-tradable service jobs. Because whatever incentive is operating because one product or service to leave will operate for the replacement. And so what you see happening, if you look at, for example, the Bureau of Labor statistics on February 11, released its 10 year projections for American job growth. And 7 of the 10 are these biggest areas of job growth are very menial, low paid service jobs. Hospital orderlies, none of them produce export goods or services.

DOBBS: The president today said be very careful talking about the issues because 20 percent of all the jobs in the country are related to trade. He talked about economic isolationism, defeatists, protectionists, who is talking about protectionism, who is talking about economic isolationism.

ROBERTS: There is no constituency for protectionism, all the big firms want to go offshore because the labor savings are large. I don't know who the protectionists are. There's no constituency.

DOBBS: The idea we have lost, the private sector jobs, it was reflected in the last unemployment report, 21,000 jobs created, 21,000 in government.

ROBERTS: In government.

DOBBS: The private sector has been hammered here and I don't think most people are aware that the job losses over the past three years are -- would even be greater if we pulled out the public sector jobs that have been added to the nation's payroll.

ROBERTS: Even worse, Lou, we've had now recovery for two years and a quarter despite the so-called economic recovery we lost another three quarter of a million jobs. This is unprecedented. And it's happened despite extremely low interest rates and very stimulated fiscal policy whether you measure it by tax cuts or deficit.

DOBBS: What is the solution, Paul? First I'm going to ask you the big questions. What's the solution on outsourcing? What's the solution on a trade deficit that -- we now have an accumulated trade deficit in debt of $3 trillion. The claims are mounting. 7 trillion in national debt?

ROBERTS: Lou, I'm afraid I don't have a solution. I'm trying to make people aware that there's a problem. And as you already noted, a lot of people are in denial and the real question is how long does it go on before the economists and the policy makers acknowledge that we do have a problem.

DOBBS: How many more jobs can our men and women lose in this country before somebody does something?

ROBERTS: How many more jobs will be lost? High value added. High productivity jobs. Middle class jobs. Jobs that were the ladders of mobility. Those are the jobs that it pays to outsource or hire over the Internet.

DOBBS: You are a terrific economist. How concerned are you about the trade deficit itself soaring now past half a trillion. Talking about 5 percent of GDP?

ROBERTS: Well, the way we finance it, Lou, we give foreigners ownership of our assets. The acquire ownership of our real estate, of our companies, of the corporate and government bonds so we lose all the future income streams that are associated with the assets when we lose the ownership. So it's a bad thing. And how it is going to come into balance, that's the real question because if you are -- if you can't close your trade deficit, with exports, the only other way is currency collapse.

DOBBS: And we haven't been able to run a trade surplus in this country of more that two decades.

ROBERTS: You can't run a trade surplus when you are producing offshore for your home markets.

DOBBS: Paul Craig Roberts, I was hoping you would come here with not only your great vision and illumination of the issue but also a solution. But I'm afraid that's going to have to wait for some policy makers.

ROBERTS: Going to take a lot of minds to think about it, Lou, and they better get busy thinking.

DOBBS: I sure join you in the hope that that picks up quickly. Paul Craig Roberts, thank you very much.

Turning now for a look at some of your thoughts, many of you wrote in about exporting America and what the president now calls economic isolationism.

Edward Jacques of Chicopee, Massachusetts. "Lou, I come from the time when we were told to buy American to support the United States. Now we're told that it's good for America to outsource jobs. What do we tell our workers when they lose their jobs?" John Gamble, New York, New York. "I find it more than a little hypocritical of the current administration so strongly promotes American independence in regard to national defense while at the same time zealously supporting unregulated trade policies."

Mark Vernon of Houston, Texas. "As a nation, we are allowing the American dream to be sold to the lowest bidder. Even though this is an election year, I wish the president could see this issue as an opportunity to compromise his carved in granite policies for the welfare of the nation. Admitting one is sometimes on the wrong path is a sign of strength in leadership not weakness."

And Don Klinger of Cherry Hill, New Jersey wrote, "As to the recent series of attacks on you by the financial establishment, they bring to mind the quote from Gandhi. First they ignore you, then they ridicule you, and then they attack you, and then you win."

Well that, I certainly appreciate the association with Gandhi and certainly your support. Thank you very much. Please send us your thoughts to loudobbs@CNN.com.

On Wall Street, stocks fall for a third straight day. The Dow lost 160 points. The Nasdaq fell 31. The S&P down 17. Christine Romans is here. Investors had a lot not to like in that trade deficit report.

CHRISTINE ROMANS, CNN CORRESPONDENT: They certainly did and they sent stocks sharply lower. A 10-week low for the Dow and the Nasdaq. The Dow has now lost 300 points, Lou, in just three days. Three problems today, the 10-year note yield at 3.72 percent telling stock investors there is something very wrong in the economy. Second, confidence is eroding. ABC Money's read of consumer comfort fell to a four-month low. And, Lou, most important, the monster trade deficit. Many fear it's reaching an inflection point and something has got to give. Here are the numbers. In January the U.S. reported near record amounts of goods and exports fell, Lou, despite a weak U.S. dollar. What does it mean for the economy and a president hungry for jobs growth?

(BEGIN VIDEO CLIP)

ROBERT HORMATS, GOLDMAN SACHS INTERNATIONAL: He can't be very happy with this, not so much because of the aggregate numbers but because there is an impact of a lot of these imports on jobs, particularly manufacturing jobs.

(END VIDEO CLIP)

ROMANS: The trade imbalance with China ballooned to $11.5 billion in January showing no signs of letting up and feeding those concerns that our appetite for cheap Chinese products translates into lost jobs. The latest snapshot of trade showing that nothing has changed from the beginning of this year to last year. Last year's trade deficit overall, Lou, $490 billion. It's not improving.

DOBBS: Another record. All right. Christine Romans, thank you. Up next. We'll have the results of our poll tonight, but first a reminder to check our website for the growing list of companies that we have now confirmed to be exporting America. CNN.com/lou. We'll continue in just a moment, stay with us.

(COMMERCIAL BREAK)

DOBBS: The results of tonight's poll. 82 percent of you responding that you believe illegal immigration and population growth are related to environmental concerns. 18 percent of you say not.

That's our show for tonight. We thank you for being with us. Tomorrow night here, I'll be joined by economics writer and author, Jim Glassman who's called me in the past a table-thumping protectionist. We'll see if he's changed his mind or whether we can persuade one another on several issues. Also Sierra Club president Larry Fahn will be here to share his views on the relationship between immigration, environment and the future of his organization. And former INS agent, Michael Cutler, testifies before Congress tomorrow and he will join us as well.

For all of us here, thanks for being with us. Good night from New York.

TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com







Aired March 10, 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: President Bush says critics of his economic policies are defeatists.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: We'll prove the pessimists wrong again.

DOBBS: Controversy over electronic voting. Today, two leading senators demand paper records for touch-screen machines.

SEN. HILLARY CLINTON (D), NEW YORK: We have to restore trust in our voting and we have to do it now.

DOBBS: E-democracy in our "Face-Off" tonight. The marketing director of Diebold and a security expert with two very different views on e-voting.

The export of American jobs could turn the United States into a Third World country, so says economist Paul Craig Roberts. He's our guest.

And the power struggle in the Sierra Club, America's oldest environmental group struggling with immigration and population growth. I'll be joined by former Colorado Governor Richard Lamm, running for the Sierra Club's board of directors.

(END VIDEOTAPE)

ANNOUNCER: This is LOU DOBBS TONIGHT for Wednesday, March 10. Here now for an hour of news, debate and opinion, Lou Dobbs.

DOBBS: Good evening.

President Bush today struck back at unnamed critics of his economic policies. The president said his opponents have a tired, defeatist mind-set. President Bush said economic isolationism, as he termed it, would lead to retaliation from other countries, retaliation that would cost American jobs.

But the president made not mention of this country's growing trade deficit. The trade deficit rose to a record $43 billion in January, as Americans bought huge quantities of foreign-made goods.

Senior White House correspondent John King reports -- John.

JOHN KING, CNN SR. WHITE HOUSE CORRESPONDENT: And, Lou, the president making that aggressive defense of his approach today in one of the state's hardest hit by the decline in the manufacturing sector, Ohio, one of the places where the debate over outsourcing U.S. jobs to cheap overseas labor markets is most emotional.

You see the president here. He's touring a factory that exports 60 percent of its products. The president used that factory tour to make his very assertive case that free and fair trade, as he calls it, is part of the solution in a difficult jobs market, not part of the problem, as many of his critics say.

Now, as the president made his way through Ohio, he is mindful of the fact that no Republican has won the White House without carrying that very critical state, the president saying those who say trade is bad or that want to erect what the president calls protectionist barriers, the president says they do not understand the global economy.

(BEGIN VIDEO CLIP)

BUSH: One in five factory jobs in this country directly depends on trade. The surest way to threaten those jobs is a policy of economic isolation. The surest way to add more jobs is a confident policy, a confident economic policy that trades with the world.

(END VIDEO CLIP)

KING: Now, the president never mentioned his Democratic opponent, Senator John Kerry by name, but aides say he had Senator Kerry in mind. Senator Kerry supported NAFTA. He supported trade preferential treatment for China. But he now says, if elected, he would review all major trade agreements.

The White House says that is protectionist. Senator Kerry also would repeal some of the Bush tax cuts. The White House says that would damage the economy. The president addressed that directly today.

(BEGIN VIDEO CLIP)

BUSH: That old policy of tax and spend is the enemy of job creation. The old policy of economic isolationism is a recipe for economic disaster.

(END VIDEO CLIP)

KING: It is a tough sell for the president. In Ohio, the unemployment rate is 6.2 percent. Again, 160,000 manufacturing jobs lost during the Bush presidency.

And as the president made his case in Ohio, today, Lou, word back here at the White House that, five months after the president promised to name a so-called manufacturing czar, the administration has settled on a Nebraska businessman for that post. Tony Raimondo will be announced soon, by the White House, we are told. He is an outspoken advocate of free trade. Senator Kerry says this is too little, too late. Senator Kerry also says, in his word, one more government bureaucrat cannot make up for the loss of 2.5 million manufacturing jobs -- Lou.

DOBBS: John, I think we all have to be curious. The president for a second day has talked about economic isolationism. Who is he referring to? Is there anyone calling for economic isolationism?

KING: Well, the administration says that Senator Kerry is trying to have it both ways on trade. Again, Senator Kerry voted for NAFTA. He voted for China's preferential trade status. He now says he would review trade agreements and he would possibly try to amend those trade agreements.

So that is one reason, because the senator has a mixed record on this. The White House did not mention him by name, but they says he certainly had him in mind. But, again, Senator Kerry saying he's no protectionist. He simply wants a fair deal for U.S. workers. Look for eight more months of this debate, Lou.

DOBBS: Again, I have got to press the point a bit, John, if I may, because the term economic isolationist suggests putting fences around the country, around our borders. John Kerry, no one else in public life that I know of, has made such a request.

KING: And that is part of the rebuttal that you hear from the Kerry campaign to the president's remarks today.

What the president says is, if you put those trade agreements back on the table, if you even say you are going to reconsider NAFTA, you're going to reconsider the trade agreement with China -- Senator Kerry has said he opposes the Free Trade Agreement of the Americas, a proposal making its way through the Congress now.

The White House says that even at the suggestion of reviewing those trade agreements, that foreign competitors would retaliate against the United States. Now, as you are making the point, many of this president's critics say that's an unfair criticism.

DOBBS: John, thank you very much -- John King, our senior White House correspondent.

During his speech in Ohio today, President Bush made a point of emphasizing the contribution of the Honda Motor Company to the state and national economy. President Bush said 16,000 Americans work for Honda in Ohio. Honda hired those workers to gain access to the world's biggest consumer car market. And the company's profits go straight back to Japan.

Bill Tucker reports.

(BEGIN VIDEOTAPE)

BILL TUCKER, CNN CORRESPONDENT (voice-over): Speaking in Cleveland, Ohio, President Bush made an interesting claim. BUSH: Foreign companies recognize the quality of American workers and that is one of the reasons why so many have chosen to locate plants in our country.

TUCKER: The quality of American workers is not in question. But that's not why many foreign automakers have plants in the United States.

ALAN TONELSON, U.S. BUSINESS & INDUSTRY COUNCIL: No, no, and they are not here because of free trade and globalization, either. The United States imposed quotas on all foreign automobile imports. We basically said jump. They said, how high? And they did exactly what the U.S. government wanted them to do.

TUCKER: The policy was imposed in the early '80s and it has worked wonders. Foreign automakers now have plants and joint ventures in 11 states. There are plants in Michigan, California, Illinois. And those employ United Auto Workers. Plants in South Carolina, Alabama, Ohio, Tennessee, Mississippi, Indiana, Kentucky, and a soon- to-open Toyota plant in Texas all will be non-union.

Sounds great, right? Well, not everyone thinks so. After all, we're granting access to our markets and those companies are taking the profits away.

REP. MARCY KAPTUR (D), OHIO: It's as though they are siphoning off some of our wealth -- and they are -- and we're getting nothing for it in their homelands. That's why I think these trade agreements have to be amended, why, with every nation where we have a deficit, we ought to have major trade negotiations under way either to open their markets or to stop playing like Uncle Sap.

TUCKER: But instead of recognizing its economic power, the United States seems reluctant to use it.

(END VIDEOTAPE)

TUCKER: And, meanwhile, the big three become the big two, with Ford and General Motors the only domestic automakers left. And in the process, the Motor Vehicle Manufacturers of America become, well, the more global-sounding Alliance of Automobile Manufacturers -- Lou.

DOBBS: Politics and economics.

TUCKER: You betcha.

DOBBS: Bill, thank you very much -- Bill Tucker.

Senator Kerry also on the offensive tonight, this time against the president's tax policies. In a campaign stop in Chicago, Senator Kerry called for bigger tax cuts for middle-class Americans, but tax increases for those who make more than $200,000 a year. Senator Kerry also criticized President Bush's record on job creation.

(BEGIN VIDEO CLIP) SEN. JOHN KERRY (D-MA), PRESIDENTIAL CANDIDATE: George Bush thinks exporting our jobs is good economic policy. I believe that creating jobs here in America, keeping good jobs here, and exporting goods is good for our economy.

(END VIDEO CLIP)

DOBBS: Later in the day, Senator Kerry met with former rival Howard Dean. Senator Kerry hopes to win over Governor Dean's supporters and donors, but Dean has not yet officially endorsed Kerry.

A new offensive tonight in the campaign advertising wars. President Bush's reelection campaign has filed a complaint with the Federal Election Commission over a new Media Fund ad. The $5 million advertisement running in 17 states accuses President Bush of -- quote -- "eroding the American dream" -- end quote. The Bush-Cheney team said Media Fund paid for it using what are called soft money donations, which would violate new campaign finance laws. Media Fund says the charges are baseless.

Meanwhile, a group of gay Republicans who supported President Bush four years ago launched their own campaign against him. The Log Cabin Republicans' ad shows Vice President Cheney supporting gay rights during a debate in 2000. The ad calls on the White House to drop its support for a constitutional amendment banning gay marriage.

Joining us now on these campaign ad wars, "Los Angeles Times" national political correspondent Ron Brownstein, senior CNN political analyst Bill Schneider, both in Washington tonight.

Let me turn to you first, Ron.

The ads, so-called 527 ads, soft money and lots of it in support of Kerry and against Bush, will it stand up?

RON BROWNSTEIN, CNN POLITICAL ANALYST: That is an open question, Lou.

The Federal Election Commission is now in the middle of a rule- making that will really decide what will happen to these committees. Very quickly, basically what we're seeing is the outsourcing, to use a word much in the news these days, of many of the activities that used to be done at the Democratic National Committee, both issue advertising, campaign advertising in support of the nominee, and also grassroots organizing in support of the nominee.

With McCain-Feingold, the campaign finance reform law, the national parties can no longer accept soft money. So Democrats created these parallel groups which are taking the same contributions that used to go to the parties and doing the same things. The FEC is going to tell us later this spring whether they can do so through the election.

DOBBS: Bill, what's the problem of making a determination? These are 527s. Rob Glaser, George Soros two of the principal sources of money for those campaigns, both have said that they are going after George Bush. Doesn't that take them out of the category that would be defensible before the FEC.

WILLIAM SCHNEIDER, CNN SR. POLITICAL ANALYST: Well, they seem to be trying to influence a federal election. It sounds like electioneering.

If they are electioneering using the ads, they are supposed to form a political committee, which is then supposed to be registered. It's supposed to have limited and regulated contributions, rather than these totally unlimited, unregulated soft money contributions that they can spend as much of as they wish without divulging the name of their contributors.

They are supposed to be subject to the federal campaign finance laws. They claim, well, they are not explicitly advocating voting for Bush -- or against Bush, voting for Kerry, so they don't come under the rules, but that's a tough argument to make.

DOBBS: We have heard from Senator McCain, Ron, that he will sue to get enforcement under the campaign finance laws. We haven't heard from Senator Russ Feingold. Will we?

BROWNSTEIN: I don't know the answer to that question.

I do suspect that whatever happens, whatever the FEC decides, this is going to end up in the courts. This has become very important for a surprising reason, Lou, which I think would be surprising to many listeners, is that, over the last 20 years, the Democrats have been more dependent than the Republicans on the unlimited big-money contributions.

Republicans have an enormous advantage in the smaller -- quote -- "hard-dollar contributions." That is where Bush is raising this huge war chest. And the Democrats do rely on this. That's why you see this activity occurring on the Democratic side, not on the Republican side, where Bush is raising an unprecedented amount of money from relatively smaller contributions.

DOBBS: Bill, that sounds like an important political advantage that could be exploited by the Bush campaign, could it not?

SCHNEIDER: And they are indeed doing that.

The Democrats are in a very awkward position. The Democrats advocated -- most Democrats were strong advocates of campaign finance reform. And what they are doing right now is exploiting a loophole. Now, they justify that loophole by saying, well, they are just trying to level the playing field. President Bush has been so successful in raising money, they are trying to be equal with him, but they are doing it by exploiting a loophole.

DOBBS: Ron Brownstein, Bill Schneider, we thank you both. Imagine that, somebody in Washington trying to exploit a loophole.

(LAUGHTER)

DOBBS: Thank you, gentlemen. Still ahead here, President Bush wants to cut federal spending. Local police chiefs say budget cuts would limit their ability to fight crime.

New questions tonight about e-voting. The marketing director of one of the leading manufacturers of e-voting machines, Diebold, and a computer security expert who says there are big problems, they face off tonight.

And a leading economist who says the export of American jobs could turn the United States into a Third World country.

Economist Paul Craig Roberts is our guest.

Stay with us.

(COMMERCIAL BREAK)

DOBBS: Insurgents in Iraq killed two American civilians and an Iraqi working for the coalition provisional authority. They were shot today by men dressed in Iraqi police uniforms South of Baghdad. Coalition troops later arrested six people, including five wearing police uniforms.

U.S. Marines in Haiti have shot and killed another two gunmen. The Marine opened fire after those gunmen were fired shots at their patrol in the capital of Port-au-Prince. None of the Marines were wounded. U.S. Marines have killed four people in Haiti since they arrived at the beginning of this month.

Meanwhile, growing money concerns tonight from police forces all across the country. Police chiefs from cities are protesting massive proposed cuts to law enforcement programs. The Senate this week began debating the 2005 federal budget. It calls for $1.5 billion cut to law enforcement. Officials in one small city say those cuts could have a devastating impact on their ability to fight crime and terrorism.

Kelli Arena reports.

(BEGIN VIDEOTAPE)

KELLI ARENA, CNN JUSTICE CORRESPONDENT (voice-over): Plano, Texas, just outside Dallas, is home to about a quarter of a million people and to several major corporations, including J.C. Penney and Frito-Lay. The city's police chief says, as big cities increase defenses, it's even more important for smaller cities like Plano to be on guard.

GREG RUSHIN, PLANO POLICE CHIEF: I would think that terrorists could then go to somewhere where it isn't quite secure. And, of course, it could be another city, a city like Plano, Texas, for example.

ARENA: Plano's police department has already eliminated about 9 percent of its work force and the chief says proposed budget cuts would do even more damage.

RUSHIN: That sleeve coverage gives us some extra protection as well.

ARENA: The Bush administration wants to siphon about $1.5 billion from federal programs that directly help local police.

JOE POLISAR, PRESIDENT, INTERNATIONAL ASSOCIATION OF POLICE CHIEFS: Targeting these critical programs for reductions of this magnitude has the potential to significantly weaken the ability of state and local law enforcement agencies to protect our communities.

ARENA: The grants that are being cut pay for things like overtime or equipment like Plano's bomb-disarming robot.

(on camera): The administration argues, while some programs are being cut, overall, local governments are getting more federal dollars.

TOM RIDGE, HOMELAND SECURITY SECRETARY: There's been a huge infusion of additional dollars to first-responders, be they first- preventers, the law enforcement community, the first-responders, in the past three years.

ARENA: But because Plano is not identified as one of the top 50 terror targets, it won't benefit as much as New York or Washington. Plano police understand the distinction, but say they still have a job to do and can't without proper funding.

Kelli Arena, CNN, Washington.

(END VIDEOTAPE)

DOBBS: A prosecutor in New York City is taking legal action to stop what is at least an unusual stand by an inmate on Rikers Island. The prisoner has copyrighted his name and he's demanding half-a- million dollars every time his name is used in court.

Queen's district attorney, Richard Brown, has had enough. He has filed lawsuits in civil court to stop the scam. This is not the first time a prisoner has copyrighted his name. There have been at least three other cases in New York.

Well, the potential for a different kind of scam has proponents of electronic voting on the offensive. Experts on both sides of the e-voting debate face off next on voting it threatens or strengthens our democracy.

And then the influx of millions of illegal immigrants into this country has sparked a power struggle at the nation's oldest environmental group. Former Colorado Governor Richard Lamm, who is running for the board of the directors of the Sierra Club, is our guest tonight.

We'll have that and a great deal more. Please stay with us.

(COMMERCIAL BREAK)

DOBBS: More than 50 million of us are expected to vote on touch- screen voting machines in the general election this November. Those machines are so controversial that today two more lawmakers demanded that they be able to print paper records.

Kitty Pilgrim reports.

(BEGIN VIDEOTAPE)

KITTY PILGRIM, CNN CORRESPONDENT (voice-over): E-voting looks simple, but how do you know the machine hasn't been hacked? Senators Bob Graham and Hillary Clinton today called for legislation to create a paper trail for e-voting, saying the machines absolutely can be hacked.

CLINTON: People who are very knowledgeable about source codes and hacking and the like, for the fun of it, they've been, you know, talking about how easy it would to skew our elections. I don't think any of us want that.

PILGRIM: A litany of problems already turned up. In the Georgia primaries, smart cards were left unprogrammed. In California, ballots were sent to the wrong precincts. Maryland also had some of the wrong encoders for the machines.

DAN WALLACH, RICE UNIVERSITY: There have been problems where we have significantly more votes cast than there are voters living in that particular precinct.

A lot of these are software glitches. What we haven't seen evidence of yet, but it could certainly happen, is, we might actually, at some point, have somebody trying to corrupt an election and try to manipulate the results.

PILGRIM: Back in January, the state of Maryland hired a team of computer security experts to try to break into its e-voting machines. The team picked the lock on the voting bay in 10 seconds and found they could easily hack the software because the security upgrades from Microsoft had not been installed. That was in January. The primary was last week on Super Tuesday. Maryland election officials say they didn't have time to change the software or the locks before the primary, but they did put tamper-proof tape over the locks.

(END VIDEOTAPE)

PILGRIM: Now, security experts say no primary race was close enough that any e-voting glitches so far would have made a difference, but they do admit the systems are still vulnerable and new safeguards have to be put in place -- Lou.

DOBBS: Kitty, thank you very much -- Kitty Pilgrim.

We'll have much more on the e-voting controversy in our "Face- Off" segment tonight. And computer security expert Rebecca Mercuri and Mark Radke of Diebold Election Systems will be here to debate whether this country is ready for electronic voting. Ready for not, here comes November.

Plus, the country's oldest environmental group debating the impact of millions of illegal immigrants on our environment. Former Colorado Governor Richard Lamm is running for the Sierra Club board. He is our guest tonight.

And the exporting of America could turn this nation into a Third World country, according to economist Paul Craig Roberts. He's our guest tonight.

Stay with us.

(COMMERCIAL BREAK)

DOBBS: Tonight's "Face-Off" focuses on the controversy surrounding electronic voting.

Mark Radke is the director of marketing at Diebold Election Systems. He says the machines his company designs make it easier for voters to cast and verify their vote, joining us tonight from Cleveland, Ohio.

Good to have you here, Mark.

MARK RADKE, DIRECTOR OF MARKETING, DIEBOLD ELECTION SYSTEMS: Thank you.

DOBBS: Computer security expert Rebecca Mercuri disagrees, however. She says paperless e-voting machines gives voters no independent confirmation of their vote. She is a Harvard University research fellow and joins us tonight from Philadelphia.

Thanks for being here, Rebecca.

Let me begin first, Mark, with you. It appears that there were some problems with e-voting, some that would be, I guess, considered hardware or structural issues, others just simply people not yet being properly trained to do their jobs. Is your company prepared to say that they can absolutely deal with concerns about verification and providing an audit trail should a recount be required in any precinct or district or county or jurisdiction this fall?

RADKE: Lou, let me just mention, first of all, that, during Super Tuesday, Diebold had over 55,000 touch-screen voting stations deployed throughout all of Georgia, throughout Maryland, and in several counties within California. And to date, I have not heard of one security issue or any case of election fraud that has occurred.

If a recount is required, we do have the capability of going back and uploading the memory card of all the voting stations. And let me take a step back as well. Before any of the voting stations are deployed for any election, each and every voting station, touch-screen station, is tested. It goes through what is called logic and accuracy testing. And that testing requires a person within the jurisdiction to test the selections on the screen and then verify that the final result that is printed from the printed copy on the voting machine equals their selections.

(CROSSTALK)

DOBBS: Rebecca, are you reassured by Mark's...

REBECCA MERCURI, JOHN F. KENNEDY SCHOOL OF GOVERNMENT: No, not at all.

In fact, it's interesting that he should say they didn't have any problem in Georgia. There were some voters in Georgia who were only given the ballot for the flag. They were not allowed to vote. And, in fact, what they were told was, well, that's the ballot we gave you, so, even though that's the wrong ballot, too bad.

And voters in California were told the same thing, although not with his machines. And so, when they talk about there's this testing that's being performed, the testing really does not reflect the actual conditions on Election Day. And there's all sorts of things that go on behind the scene that we really don't ever really hear about.

As far as these paper -- when it prints out this paper after the fact, the voter doesn't get to see that. That's all done behind the scene. And the voter doesn't have any way of confirming that that ballot is actually the one that they really cast.

DOBBS: Mark?

RADKE: Lou, could I respond to that, please?

Yes, I would just like to say that the situation in Georgia, as an example, was a procedural issue. And it had nothing to do with the operation of the voting equipment. It was a situation where the voters -- in fact, I was in Georgia on Super Tuesday -- the voters could walk in and they could sign what's called a voter certificate. And if they signed a certificate which signed -- which was a nonpartisan certificate, they passed it over to the poll worker and that particular type of card was encoded for that voter.

The voter signed the wrong sheet. It was passed over to the poll worker. The collect ballot style was programmed based on that piece of paper and the machine worked 100 percent accurately.

DOBBS: Right. I want to show...

MERCURI: Well, look, I...

DOBBS: I'm sorry. Go ahead.

MERCURI: I have been a poll worker in Pennsylvania and in New Jersey. I'm also a computer scientist.

And when we would have that problem, where a voter would do the wrong thing then we were given an opportunity to correct that. We had a way of voiding that on the machine. They would step their head out of the machine and we would tell them, OK, we would void and we had a procedure for that. So, the fact that your machine doesn't allow the people to do that, or that you haven't implemented procedures in place in the various counties where your machines are being used is irresponsible.

RADKE: Rebecca, I'm going to correct you here because we do have a procedure that does allow a person who receives the wrong ballot, if it occurs to them during the voting process at that point in time they can notify a polling official so they can cancel the ballot at that time.

MERCURI: Well, those voters weren't given that chance.

DOBBS: May I share with you and obviously our viewers two views on this subject and I'd like you both to comment. We ask Deforest Soaries, who is, as you both know, the head of the Election Assistance Commission, if e-voting, in his judgment, was secure without a paper trail and this is his response if we could roll that, please.

(BEGIN VIDEO CLIP)

DEFOREST SOARIES, U.S. ELECTION ASSISTANCE COMM: We today have the capacity to have a virtually ever free elections with current set- up and the current standards that we implement.

(END VIDEO CLIP)

DOBBS: Now, that's reassuring and I presume, Mark, you agree with it?

RADKE: I do. Let me just mention, though, Lou that if the federal government and or states in particular, require a printed receipt for a voter or something that is dropped into a secure ballot box we certainly have the expertise and qualifications and technology to provide that solution. That is not a question whatsoever. And that can be retrofitted to all of our existing machines if that is a requirement.

Today, though, Lou, there are no standards or testing requirements for that type of a product. That is the issue.

DOBBS: That is a big part of the issue. And Rebecca, your thoughts on Mr. Soaries comments.

MERCURI: That is absolutely incorrect. Every election we have, thousand of votes go missing in all sorts of states. These numbers are very huge. In fact, in the Diebold machines themselves in the California recall election, some 5 percent of the votes were not cast overall.

They were not recorded and we have instances where thousands of votes just go missing and then this is blamed on the voters. They say well the voters deliberately went in and did not cast the ballots. The problem is we have no way of providing an independent audit of this. And the fact we don't have any standards is certainly not my fault. I have been talking about voter verified paper ballots since 1992.

So that fact that the industry has not stepped up to the plate to do this is certainly not my fault.

DOBBS: Legislators are beginning to step up as you both know. Senator Graham, Senator Clinton, both today advancing the issue. Let me ask you both to listen to this comment from Senator Clinton.

(BEGIN VIDEO CLIP)

SEN. HILLARY CLINTON, (D) NEW YORK: These security concerns have been inflamed by statements of people like Walden O'Dell, the CEO of Diebold, a major electronic voting machine manufacturer, who said, not once but several times, and in writing as well as verbally, that he would do anything to ensure that President Bush would be re-elected.

(END VIDEO CLIP)

DOBBS: Now, Mark, obviously that calls for some reaction from you from Diebold on the statements from your CEO and it's obviously the source of a great deal of concern amongst those who are looking to e-voting in relying on the machines from your company.

RADKE: I'd like to state a couple points on that issue. First of all, our CEO has outwardly expressed his regret that his business has been basically mixed with his personal preference in this situation. And he has gone to the media and expressed that very fact. He has also guaranteed a lower profile when it comes to political issues.

In addition to that, though, again, his operation or his position within the company does not affect the operation or the functionality of our voting machines whatsoever.

DOBBS: Rebecca, your thoughts?

MERCURI: Well, what we basically have turned over to is a system of what we call faith based voting, where essentially the companies are in control. Whenever we've had problems with this equipment, we were giving no opportunity to examine the codes. We're told it's all proprietary.

And basically there's no opportunity to verify that either the ballots that you cast or what you intended or the vote totals are actually correct. All this is controlled by the vendors, and in some cases the election community, but largely it's just turned over to the vendors and it's a proprietary nature.

This is unacceptable. We need checks and balances. We have government officials overseeing the elections and we should not have vendors running our elections.

DOBBS: Mark...

RADKE: I'd like to respond to that, if you would mind.

DOBBS: If you can do it in 15 seconds.

RADKE: You got it. Diebold has actually been -- our system been reviewed by four independent unbiased agencies looking for the security aspects of our equipment and it has passed those tests. There have been selected recommendations that have been done including in our software.

MERCURI: To the 1990 standards not to any current standards. And the Harvard standards don't yet exist. So it's unfortunate.

DOBBS: Rebecca, Mark...

RADKE: Actually, we have passed the 2000.

I'm sorry, Lou.

DOBBS: Please finish.

RADKE: I was going to mention our -- Rebecca let me finish, please. That our latest version of software has passed every 2002 federal election commission test.

MERCURI: That's not in use right now. Those are not the ones that are in use right now.

DOBBS: Rebecca, Mark, we thank you both. I hope you both will come back with us as this issue is obviously critically important to all of us here who are planning to cast a vote that counts in November. Mark, Rebecca, thank you.

MERCURI: Absolutely.

RADKE: Thank you, Lou.

DOBBS: When we continue, I'll be joined by Richard Lamm. The former governor of Colorado says the United States has been facing an immigration problem since the early '80s. He now wants this country's oldest environmental group to take the stand on the environmental issue of immigration, he says. He is our guest next. Please stay with us.

(COMMERCIAL BREAK)

DOBBS: A power struggle is under way tonight inside the nation's oldest environmental group, the Sierra Club. My guest tonight is running for the board of directors of the Sierra Club on the platform that immigration reform should be added to the clubs environmental agenda. He says the huge influx of legal immigrants as well as illegal into this country is threatening the environment and the very quality of life in America.

Richard Lamm served three terms as the governor of the state of Colorado. He's professor of public policy at the University of Denver joining us tonight from Denver. Good to have you with us.

RICHARD LAMM, FRM. GOV. OF COLORADO: Thank you.

DOBBS: You are being called a lot of names, as you well know. There is a firestorm of controversy about moving the Sierra Clubs in the direction of immigration as a concern for environmental protection. How is this going to end?

LAMM: Well, the club is using club funds now to fight us. And I think that it's -- they will probably win, because I think breaking their own club rules and their breaking the California corporate code.

But you know there's two fights here allow, Lou. You're right, one fight is the question of immigration and population, should it be an environmental issue. The second one is the way the people are doing it. I mean, they are calling us right wing racist. I have never run a campaign where this level of vituperdness (ph) has taken place. This is incredible.

DOBBS: I have talked with several people associated with -- who are obviously who work to make certain that we are aware of hate groups in this country, to make certain that we have some perspective on that. They raise some concern on groups that are supporting some members in the slate of candidates in the board. Are you at all associated with any group that could be construed of a hate group or a racist group.

LAMM: Lou, I'm a Democrat. You know, I came out of the liberal wing of the Democratic party. My first job out of law school was a civil rights attorney. My wife marched in Selma. This is just ridiculous stuff. I think as you know, and as you personally found out because of the courageous work you've done. I mean, immigration splits, you have "The Wall Street Journal," you've got Pat Buchanan on the right, you've got the were all one world there should be no borders. And then have you my environmental viewpoint that says ecosystem doesn't need 300 more million consumer Americans.

DOBBS: And you, some people may not recall you have written extensively on the issue of immigration as well as voicing your concern about the environment. In a nutshell, if we can do that on television news which is what we do every evening here, in a nutshell your concern about relating immigration controls and population growth to the environment.

LAMM: Lou, it just seems to me it's almost a matter of definition. Every environmental book, ecology book has population as part of it. You know, if I had a magic wand and wave it that I could have the Sierra Club win every battle it was fighting right now and for the next 50 years, yet they ignored a population. You still would not want to live in this country. No American I ever talked to wants to live in an America of a billion people or even half a billion people.

DOBBS: Which is the projection for the population of the United States by the end of the century. Current growth -- current population growth rates both natural birth and immigration.

LAMM: If I could leave anything carved over the capitol when I left, it would be something like beware of solutions that were appropriate to the past and disastrous to the future. Of course immigration has made this country, that doesn't mean, it was an empty continent when the Statue of Liberty went up. We've got to understand now that the environment in the United States with all the traffic and all of the air pollution and the water pollution, the consumption, we need actually to have an argument and a discussion about population. And the Sierra Club should be part of that.

DOBBS: We thank you for being here, Governor Lamm, we appreciate it. And I will be talking tomorrow with leadership of the Sierra Club opposing you for their views just so that everyone's views are expressed here. And we thank you very much. The president of the board of directors of the Sierra Club, Larry Fahn.

Thanks again, Governor Lamm.

LAMM: My pleasure.

DOBBS: That brings us to the topic of "Tonight's Poll." Do you believe illegal immigration and population growth are related to environmental concerns, yes or no.

Cast your vote at cnn.com/lou. We'll have the results coming up later in the show.

You when you continue, I'll be joined by economist Paul Craig Roberts. He says the case for free trade has simply collapsed. Stay with us.

(COMMERCIAL BREAK)

DOBBS: Tonight the results of the first national poll on outsourcing show the American public is very concerned about jobs being exported overseas, this poll also suggests the issue will play a significant part in the presidential election. According to a CNN/"USA Today"/Gallup poll, 61 percent of Americans are concerned they will loose their job to a foreign country, 38 percent says they are not concerned.

My next guest says concerns about the exporting of American are well founded. Economist Paul Craig Roberts says the shipments of American jobs could turn this country into a third world country. Paul Craig Roberts, served during the Reagan administration and is here with us tonight, good to have you here.

PAUL CRAIG ROBERTS, ECONOMIST: Thank you, Lou.

DOBBS: This has become a remarkable issue in a number of economists are simply ignoring the issue or saying that they don't want to deal with it at this particular time because there's not enough data.

What's your reaction?

ROBERTS: Well, you see they think it's the beneficial workings of free trade what it really is a labor arbitrage (ph), a substitution of cheap labor for expensive labor. This wasn't possible until recently. It took the collapse of world socialism. It took the rise of the high speed Internet. Now they have a chance to simply put skilled, cheap, foreign labor in the role that was filled by American labor. DOBBS: And within that -- there's a suggestion that if you are concerned about the American middle class, that you are really a trader of the precepts off free trade and sophisticated thought if there's any reason to be concerned about that. This economy, this country was built on a middle class who's jobs are being exported.

ROBERTS: Exactly. When you lose high value added jobs, you lose occupations. And we can already see the effect in enrollments. You know, this year, the enrollments in computer engineering jobs dropped 23 percent. In MIT announced the enrollment in the engineers has dropped 33 percent in the last two years.

And education. We are hearing from in particular the Bush administration, many private businessmen running public companies saying the issue is really just retrain everybody, everybody will be fine. Reeducate them for a new world.

How do you react?

ROBERTS: What you have to retrain them for is non-tradable service jobs. Because whatever incentive is operating because one product or service to leave will operate for the replacement. And so what you see happening, if you look at, for example, the Bureau of Labor statistics on February 11, released its 10 year projections for American job growth. And 7 of the 10 are these biggest areas of job growth are very menial, low paid service jobs. Hospital orderlies, none of them produce export goods or services.

DOBBS: The president today said be very careful talking about the issues because 20 percent of all the jobs in the country are related to trade. He talked about economic isolationism, defeatists, protectionists, who is talking about protectionism, who is talking about economic isolationism.

ROBERTS: There is no constituency for protectionism, all the big firms want to go offshore because the labor savings are large. I don't know who the protectionists are. There's no constituency.

DOBBS: The idea we have lost, the private sector jobs, it was reflected in the last unemployment report, 21,000 jobs created, 21,000 in government.

ROBERTS: In government.

DOBBS: The private sector has been hammered here and I don't think most people are aware that the job losses over the past three years are -- would even be greater if we pulled out the public sector jobs that have been added to the nation's payroll.

ROBERTS: Even worse, Lou, we've had now recovery for two years and a quarter despite the so-called economic recovery we lost another three quarter of a million jobs. This is unprecedented. And it's happened despite extremely low interest rates and very stimulated fiscal policy whether you measure it by tax cuts or deficit.

DOBBS: What is the solution, Paul? First I'm going to ask you the big questions. What's the solution on outsourcing? What's the solution on a trade deficit that -- we now have an accumulated trade deficit in debt of $3 trillion. The claims are mounting. 7 trillion in national debt?

ROBERTS: Lou, I'm afraid I don't have a solution. I'm trying to make people aware that there's a problem. And as you already noted, a lot of people are in denial and the real question is how long does it go on before the economists and the policy makers acknowledge that we do have a problem.

DOBBS: How many more jobs can our men and women lose in this country before somebody does something?

ROBERTS: How many more jobs will be lost? High value added. High productivity jobs. Middle class jobs. Jobs that were the ladders of mobility. Those are the jobs that it pays to outsource or hire over the Internet.

DOBBS: You are a terrific economist. How concerned are you about the trade deficit itself soaring now past half a trillion. Talking about 5 percent of GDP?

ROBERTS: Well, the way we finance it, Lou, we give foreigners ownership of our assets. The acquire ownership of our real estate, of our companies, of the corporate and government bonds so we lose all the future income streams that are associated with the assets when we lose the ownership. So it's a bad thing. And how it is going to come into balance, that's the real question because if you are -- if you can't close your trade deficit, with exports, the only other way is currency collapse.

DOBBS: And we haven't been able to run a trade surplus in this country of more that two decades.

ROBERTS: You can't run a trade surplus when you are producing offshore for your home markets.

DOBBS: Paul Craig Roberts, I was hoping you would come here with not only your great vision and illumination of the issue but also a solution. But I'm afraid that's going to have to wait for some policy makers.

ROBERTS: Going to take a lot of minds to think about it, Lou, and they better get busy thinking.

DOBBS: I sure join you in the hope that that picks up quickly. Paul Craig Roberts, thank you very much.

Turning now for a look at some of your thoughts, many of you wrote in about exporting America and what the president now calls economic isolationism.

Edward Jacques of Chicopee, Massachusetts. "Lou, I come from the time when we were told to buy American to support the United States. Now we're told that it's good for America to outsource jobs. What do we tell our workers when they lose their jobs?" John Gamble, New York, New York. "I find it more than a little hypocritical of the current administration so strongly promotes American independence in regard to national defense while at the same time zealously supporting unregulated trade policies."

Mark Vernon of Houston, Texas. "As a nation, we are allowing the American dream to be sold to the lowest bidder. Even though this is an election year, I wish the president could see this issue as an opportunity to compromise his carved in granite policies for the welfare of the nation. Admitting one is sometimes on the wrong path is a sign of strength in leadership not weakness."

And Don Klinger of Cherry Hill, New Jersey wrote, "As to the recent series of attacks on you by the financial establishment, they bring to mind the quote from Gandhi. First they ignore you, then they ridicule you, and then they attack you, and then you win."

Well that, I certainly appreciate the association with Gandhi and certainly your support. Thank you very much. Please send us your thoughts to loudobbs@CNN.com.

On Wall Street, stocks fall for a third straight day. The Dow lost 160 points. The Nasdaq fell 31. The S&P down 17. Christine Romans is here. Investors had a lot not to like in that trade deficit report.

CHRISTINE ROMANS, CNN CORRESPONDENT: They certainly did and they sent stocks sharply lower. A 10-week low for the Dow and the Nasdaq. The Dow has now lost 300 points, Lou, in just three days. Three problems today, the 10-year note yield at 3.72 percent telling stock investors there is something very wrong in the economy. Second, confidence is eroding. ABC Money's read of consumer comfort fell to a four-month low. And, Lou, most important, the monster trade deficit. Many fear it's reaching an inflection point and something has got to give. Here are the numbers. In January the U.S. reported near record amounts of goods and exports fell, Lou, despite a weak U.S. dollar. What does it mean for the economy and a president hungry for jobs growth?

(BEGIN VIDEO CLIP)

ROBERT HORMATS, GOLDMAN SACHS INTERNATIONAL: He can't be very happy with this, not so much because of the aggregate numbers but because there is an impact of a lot of these imports on jobs, particularly manufacturing jobs.

(END VIDEO CLIP)

ROMANS: The trade imbalance with China ballooned to $11.5 billion in January showing no signs of letting up and feeding those concerns that our appetite for cheap Chinese products translates into lost jobs. The latest snapshot of trade showing that nothing has changed from the beginning of this year to last year. Last year's trade deficit overall, Lou, $490 billion. It's not improving.

DOBBS: Another record. All right. Christine Romans, thank you. Up next. We'll have the results of our poll tonight, but first a reminder to check our website for the growing list of companies that we have now confirmed to be exporting America. CNN.com/lou. We'll continue in just a moment, stay with us.

(COMMERCIAL BREAK)

DOBBS: The results of tonight's poll. 82 percent of you responding that you believe illegal immigration and population growth are related to environmental concerns. 18 percent of you say not.

That's our show for tonight. We thank you for being with us. Tomorrow night here, I'll be joined by economics writer and author, Jim Glassman who's called me in the past a table-thumping protectionist. We'll see if he's changed his mind or whether we can persuade one another on several issues. Also Sierra Club president Larry Fahn will be here to share his views on the relationship between immigration, environment and the future of his organization. And former INS agent, Michael Cutler, testifies before Congress tomorrow and he will join us as well.

For all of us here, thanks for being with us. Good night from New York.

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