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Lou Dobbs Tonight
Interview With Deputy Secretary of State Richard Armitage; President Bush Defends War in Iraq
Aired March 19, 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)
JOHN KING, CNN ANCHOR (voice-over): Tonight, a year of war. President Bush defends Operation Iraqi Freedom and says it has made the world a better place.
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: It's a good thing that the men and women across the Middle East looking to Iraq are getting a glimpse of what life in a free country can be like.
KING: Deputy Secretary of State Richard Armitage will be our guest and we'll talk to former Clinton National Security Adviser Samuel Berger.
Al Qaeda cornered. The battle intensifies between Pakistani troops and at least 300 al Qaeda fighters believed to be defending al Qaeda's second in command.
In "Heroes" tonight, a Vietnam veteran who has made it his mission to feed and give a much needed break to Americans wounded in Iraq and Afghanistan.
HAL KOSTER, OWNER, FRAN O'BRIEN STADIUM STEAKHOUSE: We are just making sure that these guys are treated a little better than we were when we got home.
KING: And "America's Bright Future." Tonight, a special report on a group of Colorado high school students learning about money by running their own credit union.
(END VIDEOTAPE)
ANNOUNCER: This is LOU DOBBS TONIGHT for Friday, March 19. Sitting in for the vacationing Lou Dobbs for an hour of news, debate and opinion, John King.
KING: Good evening.
President Bush today strongly defended the war in Iraq and has said it has made the world a safer place. However, the State Department is warning Americans it is -- quote -- "deeply concerned" that al Qaeda is planning to strike American targets around the world. The president's speech to officials from dozens of U.S. partners in the war on terror came exactly a year to the day when the war in Iraq began.
White House correspondent Dana Bash is live now at the White House with a report -- Dana.
DANA BASH, CNN WHITE HOUSE CORRESPONDENT: John, the president called this day one year ago when he ordered airstrikes into Iraq a day of deliverance, and he used the speech today to highlight what he said have been the good things that have come to Iraqi people.
He said no more torture chambers, no more mass graves. He made only a passing reference, though, to weapons of mass destruction. That was the central reason for going to war. And those, of course, have not yet been found. But some of the countries that opposed the war in Iraq were actually in the audience today represented there, like France and Germany. The president said that even if they disagreed they can all agree now the world is better off without Saddam Hussein.
(BEGIN VIDEO CLIP)
BUSH: There have been disagreements in this matter among old and valued for friends. Those differences belong to the past. All of us can now agree that the fall of the Iraqi dictator has removed a source of violence, aggression, and instability in the Middle East.
(END VIDEO CLIP)
BASH: Now, with the bombing last week of a train in Spain and a subsequent defeat of a key ally there, and, of course, bombings this week in Iraq, the administration has been working desperately behind the scene to try to keep the coalition there together.
And today, the president's message to more than 80 diplomats who were in the East Room here at the White House was that no country is safe from terrorism whether or not they supported the war in Iraq. And he said any sign of weakness will be seen as a retreat by the terrorists.
(BEGIN VIDEO CLIP)
BUSH: Each attack is designed to demoralize our people and divide us from one another. And each attack must be answered not only with sorrow, but with greater determination, deeper resolve, and bolder action against the killers.
(END VIDEO CLIP)
BASH: Now, Mr. Bush was speaking as much to American voters here who are divided whether or not Iraq was the right thing to do as he was to allies, and the president's political opponents immediately jumped on him saying that the war in Iraq wasn't necessary and that perhaps it has taken away from the broader war on terrorism -- John.
KING: And, Dana, the president himself and key deputies on his national security team working the phones today reaching out to key allies overseas. Is that routine or is that a sense of trepidation that there could be cracks in the coalition?
BASH: Well, we are told that there definitely is concern among people here at the White House that allies are getting a little bit skittish.
Dr. Rice, Condoleezza Rice, the national security adviser, has been working the phones all week long talking to key allies in Italy, her counterpart in France and elsewhere talking about the fact that they need to stay the course on the broader war on terrorism, but also specifically in Iraq. The president himself talked to the president of Poland today. They are trying desperately to keep that country from keeping their troops -- from taking their troops out of Iraq -- John.
KING: Dana Bash for us tonight at the White House, thank you very much.
And within an hour of the president's speech, several explosions rocked Baghdad. A senior military official said insurgents fired rockets or mortars that may have penetrated the heavily guarded coalition headquarters in Baghdad. No one was wounded. The attack came just hours after Secretary of State Colin Powell made an unannounced visit to coalition headquarters in the Green Zone. Powell acknowledged that there has been a spike in violence against the coalition and soft targets in Iraq, but he said the coalition will not be deterred.
(BEGIN VIDEO CLIP)
COLIN POWELL, SECRETARY OF STATE: This is not the time to say let's stop what we're doing and pull back. This is the time to redouble our efforts in every way, law enforcement activities, intelligence activities, and deal with this threat to the civilized world and not run and hide and think that it won't come and get us. It will come and get us.
(END VIDEO CLIP)
KING: Since the United States invaded Iraq one year ago, 572 American troops have been killed in the operation; 139 of them were killed during the initial campaign; 433 have died since the president declared the end of major combat in Iraq last May. The number of American troops in Iraq has dropped from 200,000 during the war to roughly 130,000 now.
Earlier today, Deputy Secretary of State Richard Armitage told me he expects that violence in Iraq to continue. We discussed international support for the war and how it has evolved over the last year. We'll have my conversation with the deputy secretary of state later in the broadcast. I'll also talk with former National Security Adviser Samuel Berger.
Democratic presidential challenger Senator John Kerry marked the anniversary by praising U.S. troops in Iraq and criticizing President Bush. Kerry released a statement from vacation in Idaho, calling American troops the best and the brightest. But Senator Kerry said President Bush has not told the truth about the war from the beginning and he said -- quote -- "It's time to take the targets off the backs of U.S. soldiers, reduce the burden on America's taxpayers and finish the job in Iraq" -- end quote. France's foreign minister is once again speaking out against the war in Iraq. Dominique de Villepin says the world is more dangerous now than it was before the invasion. De Villepin told the French newspaper "Le Monde" that terrorism did not exist in Iraq before the war. Now he says Iraq is one of the principal sources of global terror.
The United Nations is sending a team to Iraq as soon as possible. That team is going at the request of the Iraqi Governing Council and the U.S.-led coalition. And while the U.N.'s role in Iraq's future is still unclear, this will pose a crucial test for the organization.
Kitty Pilgrim has the report.
(BEGIN VIDEOTAPE)
KITTY PILGRIM, CNN CORRESPONDENT (voice-over): U.N. Secretary- General Kofi Annan and the U.S. Special Envoy to Iraq Lakhdar Brahimi said the U.N. was not looking for a job in Iraq.
LAKHDAR BRAHIMI, U.N. SPECIAL ENVOY TO IRAQ: I think the Iraqis in the Governing Council and out of the Governing Council are overwhelmingly demanding that the U.N. plays a role.
PILGRIM: The United Nations withdrew their team from Iraq after the bombing of their headquarters in August that killed, among areas, U.N. Envoy Sergio Vieira de Mello.
Now the U.N. is going back in to assist in the transfer of sovereignty to the Iraqis, scheduled for June 30. Iraq has been torn by particularly bloody bombings in event week. L. Paul Bremer, the head of the coalition provisional authority, says the attacks are directly related to the elections.
PAUL BREMER, U.S. ADMINISTRATOR IN IRAQ: I think it is quite likely that we will face a concerted effort by the terrorists between now and June 30.
PILGRIM: Looking at the U.N. track record in Afghanistan, where a U.N. team has been trying to organize voter registration, only about a tenth of voters have been registered, and Afghan President Hamid Karzai was forced to admit, because of that, elections planned for June could be delayed.
ABRAHAM SOFAER, HOOVER INSTITUTION: I think it will be easier to get the voters registered in Iraq than in Afghanistan. Although we are having a lot of security problems in Iraq, the overall security situation, the control of the country as a whole, is much more in the hands of the coalition authority and will be in the hands of the council and the Iraqi police and army by June 30.
PILGRIM: For that reason, the U.N. says general elections may be possible in Iraq by January of next year.
(END VIDEOTAPE) PILGRIM: Now, the U.N. may step in to an expanded role in Iraq in the future, for example, heading up some kind of coalition of multinational forces, but all of that is just talk at this point, John.
KING: Just talk, but talk that has intensified since the newly elected Spanish prime minister has said he will pull his troops out if there's no U.N. mandate?
PILGRIM: That's exactly right. And, as you know, he campaigned on that issue. And so it's a very important point for him. He has not backed down from that point.
KING: Much to be resolved still about the U.N. role.
Kitty Pilgrim, thank you very much.
And coming up next, fierce fighting between al Qaeda forces and Pakistani troops to capture a leader of the radical Islamist terrorist group. We'll talk to Deputy Secretary of State Richard Armitage and former National Security Adviser Samuel Berger.
Plus, in our feature series "Heroes," a hot meal and a night away from hospital food, courtesy of one veteran.
And March madness, but not on the basketball court. We'll have a special report on rising gasoline prices.
That and much, much more ahead. Stay with us.
(COMMERCIAL BREAK)
KING: Pakistani forces today say they will -- quote -- "finish the al Qaeda fighters at any cost."
Intense fighting continues in the mountains along Pakistan's border with Afghanistan. Pakistani officials believe they have cornered Osama bin Laden's top lieutenant. A Pakistani general today said his troops are prepared to use whatever means necessary to root out hundreds of al Qaeda fighters currently in hiding. He said, simply -- quote -- "The mission is to get these people dead or alive."
It's an operation of intense interest to U.S. military officials.
And CNN Pentagon correspondent Jamie McIntyre joins me now -- Jamie.
JAMIE MCINTYRE, CNN MILITARY AFFAIRS CORRESPONDENT: And, John, the U.S. is watching closely what is going on in Pakistan along that border region.
And we're told that the good weather, the clear skies has given the U.S. intelligence gathering apparatus a better look at what is going on, on the ground. Still, though, the best intelligence is coming from people on the ground, people captured by the Pakistani military and interrogated. That's where the evidence comes that Ayman al-Zawahri, Osama bin Laden's No. 2, may be among those people being protected by Islamic militants.
But today, U.S. government officials continued to say they don't know who, if anyone, is there. And that was a view echoed by U.S. Defense Secretary Donald Rumsfeld when he talked to CNN's Larry King in an interview that will be aired tonight.
(BEGIN VIDEO CLIP)
DONALD RUMSFELD, SECRETARY OF DEFENSE: Occasionally, when someone is captured, you can interrogate them and find out still additional information. I don't know -- the situation today, of course, in Pakistan has caused a lot of press attention. And it's not clear to me who is there, if anybody. But certainly there are an awful lot of fine Pakistani forces working hard.
(END VIDEO CLIP)
MCINTYRE: An awful lot of U.S. forces on the other side of the border waiting to see if anyone tries to escape over the border. The U.S. has Predator spy planes, unmanned spy planes flying long the border region, but it won't say if those planes are flying over Pakistani airspace.
However, if you go back to my original statement that U.S. officials say the clear skies are giving them a better view, you can put two and two together and pretty much figure out that the U.S. has some eyes in the skies over this situation -- John.
KING: Eyes in the skies, presumably perhaps even eyes on the ground. Jamie, the longer this goes on -- the anticipation rose, yesterday, of course. The longer this goes on, does that raise concern at the Pentagon that perhaps whoever this high-value target could be might have more time to get away?
MCINTYRE: Well, the conventional wisdom at the Pentagon is that in all likelihood there's a good likelihood that the people will slip away. It's just very hard in this kind of region to have a sort of hole-proof net around the area.
So there is a lot of concern about that. There's also concern about raising expectations. But I think the feeling is the longer it goes on and they're not able to get away the more likely they will be able to figure out who is there.
KING: Jamie McIntyre tonight for us at the Pentagon -- thank you, Jamie.
The president and vice president of Taiwan survived assassination attempts today in the southern city of Tainan. The two were campaigning ahead of Saturday's closely contested presidential election when they were shot. President Chen Shui-bian was shot in the stomach. Vice President Annette Lu was shot in the leg. Both were released from a hospital and an investigation is under way. Officials say Saturday's election will go on as scheduled.
And coming up next in "Heroes," one Vietnam vet shows his gratitude to soldiers wounded in Iraq with steaks and beer. We'll tell you why those soldiers are getting much more than a warm meal.
And as the war in Iraq reaches the war in Iraq reaches the one- year mark, I'll talk with Deputy Secretary of State Richard Armitage and former Clinton National Security Adviser Samuel Berger about what's ahead in the global war on terror.
(COMMERCIAL BREAK)
KING: Every Friday night at a steakhouse called Fran O'Brien's in Washington, D.C., a group of soldiers get together for dinner and drinks on the house. They are the soldiers of Ward 57 at the Walter Reed Army Medical Center, the amputee ward.
Lisa Sylvester has their story.
(BEGIN VIDEOTAPE)
KOSTER: You doing all right, man?
UNIDENTIFIED MALE: Yes, I'm doing fine.
KOSTER: How you doing tonight
LISA SYLVESTER, CNN CORRESPONDENT (voice-over): Hal Koster, the owner of Fran O'Brien's in Washington, D.C., thought a decent meal was the least he could do for the soldiers injured in Iraq and Afghanistan. So he started the Friday suppers last October. Hal can relate to what they have been through. He's a Vietnam vet.
KOSTER: We are just making sure that these guys are treated a little better than we were when we got home. That's all.
SYLVESTER: When the dinners first started, only one guy showed up, the next week, a couple more. Now they regularly feed more than 40 people. Even the occasional celebrity shows up.
(on camera): These soldiers appreciate not having to eat hospital food one night out of the week. But what they really enjoy is talking to others who understand what they are going through.
SGT. MICHAEL CAIN, U.S. ARMY: Everyone enjoys themselves over here, and everybody loves it here. And their morale is really good.
SYLVESTER: Staff Sergeant Daniel Metzdorf lost his leg when a bomb detonated southwest of Baghdad in late January. He's grateful to be alive. Three other soldiers died that day.
STAFF SGT. DANIEL METZDORF, U.S. ARMY: I lost my limb, but that's nothing. The hospital has given me a brand new leg. It's a small injury compared to what some of these guys have gone through.
SYLVESTER: Alex Leonard's convoy was attacked in Iraq. The Humvee he was driving was hit by a roadside bomb. When he looked down, he was missing his right leg.
SPC. ALEX LEONARD, U.S. ARMY: Actually, I'm glad it was me than one of the other guys that we were with.
SYLVESTER: These soldiers have no regrets.
METZDORF: They came and asked me, if I had one wish, my one wish would be to go back over with my soldiers in Iraq and just do what I love doing.
SYLVESTER: Their brush with death makes them cherish the things that matter, their love for their country, their love for their families and the companionship of good friends.
Lisa Sylvester, CNN, Washington.
(END VIDEOTAPE)
KING: What a great piece.
Tonight's thought is on heroes. "Nurture your mind with great thoughts. To believe in the heroic makes heroes" -- those words from the former British Prime Minister Benjamin Disraeli.
And coming up, Iraq one year later. Deputy Secretary of State Richard Armitage and former Clinton National Security Adviser Samuel Berger will join us. Then, the exporting of America pits big business against small and local communities against national organizations. We'll have a special report tonight.
And whatever happened to buy American? Presidential campaign merchandise imported from a country now under U.S. trade sanctions. That story and a great deal more still ahead.
(COMMERCIAL BREAK)
KING: Earlier today, I discussed the war in Iraq and the broader war on terror with the No. 2 man at the State Department, Deputy Secretary Richard Armitage. And I began by raising the French foreign minister's complaint that in his view the Iraq war has increased the terrorist threat.
(BEGIN VIDEOTAPE)
RICHARD ARMITAGE, DEPUTY SECRETARY OF STATE: I think I simply disagree. Terrorism had emanated from Iraq before a year ago. There is still a great battle going on there now. And if we're successful -- and we fully intend to be successful -- the Middle East and indeed the world will be a much safer place.
KING: More bombings in Baghdad today, some violence over the past 72 hours or so leading up, if you will, to the one-year anniversary. What is your sense. Who is doing this and why?
My own view is that this violence that we're seeing will continue, certainly, to try to disrupt the turnover of sovereignty to Iraqis on 1 July. I think the closer we get to that date, the closer Iraq is to being a multiethnic, multireligious society, well on the path to democracy, the more it threatens the interest of those who do not want to see a secular government.
So, to answer the first part of your question, clearly, there are some of the former regime elements. But more and more, it looks like other outsiders who are intent on destroying secular governments are doing the violence.
KING: Saddam Hussein has been in the custody of the United States for quite some time now. Is the United States learning anything meaningful from him at all? And I understand from your comments in recent days, sir, you think he's being a bit of a wise guy?
ARMITAGE: Well, I have felt he's been a wise guy for some time and it certainly appears he's being that way now with his interlocutors.
But, as I also said in recent days, I think we are going to have a while before we can connect all the dots in what he's telling us. And clearly, whatever he tells us will have to be checked against other people's recollection and intelligence that is collected ton ground.
KING: Is he cooperating at all or is he simply debating?
ARMITAGE: Well, I don't know since I wasn't personally involved that I can characterize it. I would say that he appears to be enjoying himself.
KING: Since the election in Spain and the change of government, the newly elected prime minister says he will pull his troops out. He has said that he believes the Bush administration's approach to the war on terrorism has been a failure, that in fact that violence and the use of military force is inspiring more terrorism. Romano Prodi at the European Union has said the same thing, Mr. de Villepin today.
Is there a debate among long-standing allies of this country, the United States, about the strategy, the Bush administration's strategy, and how would you answer those critics?
ARMITAGE: We were attacked wantonly on 9/11.
And we decided we're not going to take it anymore. And President Bush summoned a mighty coalition to kick the Taliban out of sanctuary and kick al Qaeda out of sanctuary in Afghanistan. So clearly those who you think that you can conquer the global war on terrorism without some resort to military force are dead wrong.
KING: It's a debate not only overseas, a debate in this country now in the middle of a presidential campaign in which the president's Democratic opponent, Senator John Kerry, says the approach is a failure. And he says that the administration, including your State Department, sir, have been stubborn and arrogant, sticking to a policy that he says is a failure and driving away allies. How would you answer him?
ARMITAGE: Well, I attended the president's speech today. And I noticed the flags of 84 countries arrayed behind the president. These are the 84 nations in the world who are with us in the global war on terrorism. So I think that graphic demonstration or tableau ought to answer Senator Kerry's remarks.
KING: I want to turn our attention, sir, to the military operation under way along the Pakistan-Afghanistan border. Very hard to get definitive information out of there, but sources within Pakistan say they believe they have surrounded up in that remote area Osama bin Laden's No. 2, Ayman al-Zawahri. Do we have any reliable information that that is the case, sir, and what do you know about that operation?
ARMITAGE: Yes, the Pakistanis have told us the same thing. I have no independent corroboration.
It is the case, however, that there seems to be quite a battle going on and the Pakistani forces have committed a large amount of energy and commitment of people to the prosecution of those who are destabilizing Pakistan as well as Afghanistan.
KING: What would be the significance if it, in fact, is bin Laden's No. 2? And as you answer the question, how much U.S. resources involved in helping here?
ARMITAGE: Well, I don't think I'm inclined to answer the second part.
But, on the first part, I think it would be important, but it is certainly not going to stop terrorism. We believe we've got about three-quarters of the higher-ranking al Qaeda leadership dead or locked up. I think it would be a good psychological blow to be able to take down Zawahri and Osama bin Laden, but that in itself is not going to stop terrorism.
As the director of our Central Intelligence Agency, Mr. Tenet, indicated recently, with the greater difficulty that the leadership of al Qaeda is having directing terrorism, it seems that al Qaeda cells have become somewhat more regionally oriented and somewhat more autonomous.
(END VIDEOTAPE)
KING: Our thanks to the deputy secretary of state, Richard Armitage.
And that brings us to the topic of tonight's poll question: Do you believe the war in Iraq has increased or decreased the global terror there, increased, decreased, or no difference? Cast your vote at CNN.com/Lou. We'll bring you the results later in the program.
Former Clinton White House National Security Adviser Samuel Berger is among those advising Democratic Senator Kerry.
I spoke to Mr. Berger a short time ago and asked him if he believes President Bush has an effective exit strategy for Iraq. (BEGIN VIDEOTAPE)
SAMUEL BERGER, FORMER NATIONAL SECURITY ADVISER: If he does, I don't think we have seen it yet.
I think it's extraordinarily important that we succeed in Iraq, whether one was for this war or against this war. An Iraq that descends into chaos and turmoil would be a disaster for the region and a disaster for the world. And, conversely, an Iraq that came together and was stable and pluralistic would be healthy for the region. So we've got a lot at stake here.
But we're going to turn sovereignty over on June 30 to the Iraqis, but we don't know what Iraqis or what form this will take. And, essentially, we're going to sign a certificate of title to the Iraqis and we don't know who, what, or what form that will take. That doesn't sound to me like a plan.
KING: The president in his speech said he wanted to let bygones be bygones. He specifically mentioned Germany and France. But the French foreign minister today said that, in his view, the Iraq war has increased the terrorist threat in the world, not decreased it, as President Bush would say. Who do you agree with?
BERGER: Well, I don't think that we're any safer from terrorism today than we were before the Iraqi war. I don't think that Iraq and Saddam Hussein was involved in September 11 or tied to al Qaeda. I do think that the fact that we've done this basically alone, without allies, without much of a plan for the occupation, has created a cauldron, and it has become magnet for terrorists from around the world, and a source of great resentment to the United States as demonstrated by the most recent survey research by the Pew Group, showing our ratings falling all around the world.
So I don't think we are safer today from terrorism than we were before the Iraqi war.
KING: You say you don't think we're any safer from terrorism today. That is one of the great debating points in this race for president. And in trying to make that contrast, the Bush administration suggests that Senator Kerry would go from the war approach, the aggressive, proactive approach of the Bush administration, to treating the war on terrorism more like a law enforcement matter.
I want you to listen to something Condoleezza Rice, your successor as national security adviser in the White House, said yesterday, how she defines this choice.
(BEGIN VIDEO CLIP)
CONDOLEEZZA RICE, NATIONAL SECURITY ADVISER: Whether the right response to the act of war that was committed against this country on September 11, when they went after the Twin Towers and the Pentagon, and perhaps the Capitol and the White House were on the list, whether that act of war is going to be answered by an American strategy that is bold and decisive and takes the fight to them, or whether we're going to go back to days when we thought that principally this was a law enforcement action and we would use kind of minimal military force once in a while.
That's what led to September 11. It was the fact that the country was not really mobilized to take on the war that had been launched against us.
(END VIDEO CLIP)
KING: Samuel Berger, sounds not only like a criticism of Senator Kerry, but also a criticism of your days in the Clinton White House.
BERGER: Well, I think it's a total red herring. First of all, I don't there's any administration, Democrat or Republican, or Green, for that matter, that would not have responded to September 11 with the full force of American power.
We never had a law enforcement -- we did not law enforcement approach even before September -- during the Clinton administration. We used all of the tools at our disposal in the pre-9/11 context from cruise missiles to diplomacy. There is a role for the FBI to investigate. But I think that's really a bumper sticker. It's not an argument.
KING: What is your sense today -- the president had 80-some nations invited to the East Room today. He had all the flags behind him. He says there is a thriving coalition in the war on terrorism. Of course, the newly-elected Spanish prime minister has said he would pull his troops from Iraq. He calls that a fiasco. He says that the use of military force is only increasing and inspiring the terrorists.
What is your assessment on this day of the current status of the war and the president's international support in it?
BERGER: I think we're losing altitude rather than gaining altitude. I think we're losing allies rather than gaining allies. I'm very sorry to see the Spanish withdraw from Iraq because I think it's important that they stay. But that's a fact. We had the Poles wavering whether they will go or stay.
You know, you can put a lot of countries -- I'm sure the Marshall Islands, which is part of our coalition, was in the White House today. The fact is that over 80 percent of the troops in Iraq are us and the British. And if you take the British out, over 90 percent are American, and about 80 percent are us and the British. So this is a coalition mostly in name.
The fact of the matter is, on the ground, there are Americans, some Brits and a smattering of others.
KING: Well, then finish this sentence for me in closing. You are an adviser to the Kerry campaign. This is a key issue in this presidential campaign. Finish this sentence then for me. You believe that Senator Kerry would be more effective in leading the war on terrorism than President Bush because... BERGER: Because I think it will take a new president to strike a new bargain with our allies which says, we're prepared to share decisions if you're prepared to share the risks.
KING: Samuel Berger, former national security adviser in the Clinton administration. Sir, thank you very much for your time.
BERGER: Thank you, John.
KING: When we return, march madness at the gas pumps. And some say the worst is still to come. We'll have that report up next.
(COMMERCIAL BREAK)
KING: Crude oil prices resume their march higher today, closing at just under $38 a barrel. That means more upward appreciate on gasoline prices here in the United States. That, of course, means more unhappy motor is. Peter Viles has that report.
(BEGIN VIDEOTAPE)
PETER VILES, CNN CORRESPONDENT: March Madness, sweeping the country. No, not on the basketball court but at the bump. Los Angeles full service premium, that's right, $2.89 a gallon.
UNIDENTIFIED MALE: I think they are outrageous. I don't think there's any reason for it.
VILES: New York City, $2 a gallon and higher.
UNIDENTIFIED MALE: They are way too high. It's ridiculous. Sometimes they go up the next thing you know they will bring them down a little bit. When you turn around they bring them up even more.
VILES: Months before the summer driving season gasoline prices are spiking. $1.74 on average across the country. $1.91 in New York, over $2 a gallon in Las Vegas and Los Angeles. One reason, a patchwork system of different gasoline blends and regulations in different states.
PETER BEUTEL, OIL ANALYST: We have too many different grades of gasoline particularly in the summer. If you deliver gasoline in New York Harbor, on one side of the river in New Jersey, you are delivering gasoline with MTBE, if you deliver it in New York you are delivering it with ethanol.
VILES: But the problem is also global. Demand is rising and supply is not because OPEC is holding back production. Much of the new demand comes from China, tens of millions of Chinese discovering the joys of the automobile.
GUY CARUSO, ADMINISTRATOR ENERGY INFORMATION ADMIN.: We are thinking China may have grown as much as 400,000 barrels a day last year, which is about almost one-third of the growth in global oil demand. VILES: Crude prices have shot up 40 percent since September are now higher than they were a year ago when the U.S. attacked Iraq. Iraq's oil is flowing, but the continuing turmoil there is helping to keep global prices high.
(on camera): This price squeeze at the pump is likely to get worse before it gets better. The Bush administration now says it expects gas prices to rise another 10 cents per gallon over the next two months. Peter Viles, CNN, New York.
(END VIDEOTAPE)
KING: An editorial cartoon in today's papers perhaps helps capture some of the anxiety. It shows a brink's armored truck that has been robbed. The caption underneath, "no, they left the money but they siphoned all our gas." Our thanks to syndicated cartoonist, Bill Schur (ph).
Another steep selloff on Wall Street. The Dow tumbled nearly 110 points. The Nasdaq fell 22 points, the S&P 500 lost more than 12. Today Christine Romans joins us now.
CHRISTINE ROMANS, CNN FINANCIAL CORRESPONDENT: And now the Nasdaq is down 8 of the last nine weeks. It's been a tough run overall, 9 percent the Nasdaq is down in that time. And for this week, the Nasdaq well 2 percent, the Dow is down another half a percent and the S&P 500, John, is now down two weeks in a row, that hasn't happened since late last year.
This job market mystery still has economists scratching their head. We learned this week the jobless line is the shortest since early 2001. Economists say that indicates the firings have slowed, but high productivity, outsourcing and cautious CEOs have kept hiring minimal and they are more than 3 million long-term unemployed people. That number rose in the latest week. That doesn't include the half a million that dropped off the roles when their extended benefits expired in December. And it also doesn't count the discouraged workers. The hiring hasn't happened yet. And John, no one, still, knows when it will.
KING: So, Christine, we spent a lot of time this part of the program talking about corporate and executive greed, a cheery story on a Friday?
ROMANS: I have a cheery story for you. The CEO of Ford is going to give his bonus to his workers. It is about $1.5 million and it will go toward tuition assistance for employees' kids. He said he wanted to thank his employees for the company's performance last year. He doesn't take a salary but no crying for Bill Ford, he obviously is related to the founder of the countries. He has his own 2.7 million shares of company stock. But he will give up his restricted stock bonus, about $1.5 million to employees.
KING: A nice thing to do. Christine Romans, thank you very much. Have a great weekend.
Now for a look at some of your thoughts on exporting America.
Michael Howard of Royal Palm Beach, Florida writes, "With millions of Americans slated for retraining, how much does it cost to train people to ask, you want fries with that?"
Wayne of Raleigh, North Carolina, "Thanks for providing a voice for the few middle-class workers left in America. The issue is jobs, the backbone of America is our ability to work and support our families."
On America's foreign policy and the war on terror. Kathy of Denver, Colorado. "I was dismayed to hear Condoleezza Rice link the September 11 attacks to Iraq and Saddam Hussein. It is misleading to continue to suggest that the Iraq war had anything to do with al Qaeda."
And Deborah Gabel of Newport Beach, California, "Taking an offensive position reflects decisive action. We can be proud that the United States showed leadership and the ability to make a decision rather than to wait, see, which red, yellow, or orange alert we could bow to today."
We love hearing from you always. Email us at loudobbs@CNN.com. And a reminder now to weigh in on tonight's poll question. "Do you believe the war in Iraq has increased, decreased, or made no difference to the global terror threat." Cast your vote at CNN.com/lou. We'll bring you the results a bit later in the show.
When we return, exporting America, presidential products made by cheap foreign labor. Critics blast the Bush administration for not being made in America.
The issue of trade is creating a sharp political debate in an already intense election year. We'll take a look at the divisions forming within several national organizations.
(COMMERCIAL BREAK)
KING: The debate over the exporting of American manufacturing to cheap foreign labor markets has caused a deep divide within American business, smaller manufacturers are increasingly at odds with their larger counterparts over the issue. Now some local businesses are fighting back, Bill Tucker reports.
(BEGIN VIDEOTAPE)
BILL TUCKER, CNN CORRESPONDENT: Trade is rarely personal, it is ships and cargo. The closest it gets to personal for most people is a lower price. Not so for many small and medium-sized manufacturers. They take trade very personally and they are angry, frustrated with groups like the National Association of Manufacturers.
PETER DIVENERE, DEMCO MANUFACTURING: Maybe because they don't have to meet a payroll every week and they don't work with 35 people on the floor every day and have to face them and tell them that layoffs are coming down. The work is being stepped up offshore. TUCKER: The National Association of Manufacturers responds to the criticism being leveled at it by noting that the problem is not trade. The problem is runaway healthcare and energy costs.
MICHAEL BAROODY, If we don't address the cost that government could do something about from healthcare to regulation to taxes to litigate the legal system, then we will continue to lose jobs.
TUCKER: Dissatisfied manufacturers are not alone. At the local level many Chamber of Commerce groups share the feeling of disappointment in their group's efforts to keep jobs in America. The National Chamber says it understand the frustration but says the trade is our future and to that end it has programs designed to show smaller towns of businesses how to adapt.
LESLIE SCHWEITZER, U.S. CHAMBER OF COMMERCE: This is very hands on. This is not something that we go in and do a program and then we leave. We are very actively involved in helping these small businesses to understand the resources, both federally and privately.
TUCKER: And that's great, but that's cold comfort to a town where Thompson (ph) just closed its television tube plant and laid off 1,000 workers.
AARON DEWEESE, MARION, IND. CHAMBER OF COMMERCE: I'm worried about the mom and pop businesses that -- that are certainly going to feel the loss of an estimated 36 million dollars in wages that the Thompson workforce represented.
TUCKER: The Marion Chamber of Commerce is planning to take its case to Washington, D.C. personally. Bill Tucker, CNN, New York.
(END VIDEOTAPE)
KING: A bit of an embarrassment today for the Bush-Cheney campaign. The campaign is selling fleece pull-overs that were made in Myanmar, a country formerly known as Burma. President Bush banned imports from that country last year citing a repressive military regime and human rights violation.
According to a statement from the Bush-Cheney campaign the manufacturer of the jackets said the order was a mistake. The Bush- Cheney camp said that it is committed to making sure that only products made in the U.S.A. are sold on its website. And joining me now for more on all of the week's big developments, tonight's newsmakers. Steve Forbes, editor-in-chief of "Forbes" magazine, Jim Ellis, chief of correspondents at "Businessweek" and Bill Powell, managing editor at "Fortune."
Gentlemen, it was one year ago tonight that the bombing started in Iraq. Steve Forbes, one year later, are you confident that this president has an exit strategy?
STEVE FORBES, "FORBES": I think he has a winning strategy on the war against terror. Not only do you have a critical country in the Middle East that is going in a liberal Democratic path for the first time in that region, outside of Israel, Libya has finally 'fessed up to their weapons of mass destruction. The Iranians are under pressure and the North Koreans are in disarray so in totality, the war on error it's been a huge progress in the past 12 months.
KING: Do you agree with that, an exit strategy for Iraq specifically?
JIM ELLIS, "BUSINESSWEEK": I don't think we have an exit strategy yet. The coalition of the willing that we sort of trumpeted a lot about hasn't turned out to be much of a coalition. I think we have seen now with the change of government in Spain and also the sort of reticence by the polls. We don't quite know how we're going to get out of this. I think we're right, but unfortunately we sort of underestimated the difficulty in actually making this work.
KING: Do you think a year ago, tonight, the president would have thought that they would not have a plan, yet, a firm plan for turning power to a new Iraqi government, that you would still had violence like this?
BILL POWELL, "FORTUNE": No. I think he thought that there would not be violence like this and presumably that they would have a plan. That part of the equation is discouraging. I would say on the question of whether there's an exit strategy if there is one, already, then Iraq is in more trouble than we think. The fact is, we -- hopefully with NATO and the United Nations need to be there at least in a military sense and we need to be there for a long time to come. That's, I think, what the administration has got to tell people.
KING: Let's stick on the point of international support. An interesting week. The elections in Spain, then you have Romano Prodi of the European Union and now the French foreign minister not only questioning the war in Iraq but the whole strategy against terrorism saying that military force is in their view creating more terrorists, not rooting out the terrorists. How does that affect how the president carries this forward?
POWELL: I think it's not going to affect at lee in the short term what President Bush strategy is. I think he is eagerly seeking to internationalize the effort in Iraq. You know, we'll see what -- whether the U.N. steps up to the plate there or not. I think that's still in play.
KING: And how does that ripple, the international questions coming in the middle of a U.S. presidential campaign.
ELLIS: I think it puts the pressure on the president to actually sort of get some international support behind this. That's one of the things the Democrats are hammering him about. The problem is that it's very difficult right now for a lot of Europeans to see that our battle is basically their battle also.
That basically the fight against terrorism and the fight against the sort of destabilizing forces in the Mideast is against the western way of life, it's against individual freedoms, women's rights, capitalism and basically whether they like it or not, whether they like the United States or not, their battle is the same one as ours.
KING: The United Nations team is about to go back in. Do you think this administration is prepared to give significant power to the United Nations and do you believe the U.N. is up to the job?
FORBES: The answer is, I hope they don't give too much power to it, because the U.N. elsewhere in most other parts of the world have made a mesh of it, you see it in Haiti and elsewhere, they are not up to the job. Ultimately, it is going to be in our court no matter who we bring with us.
I think Jim is exactly right, we have to do a better job in explaining to the European public this is a war against women, what al Qaeda is doing, it's a war against civilization. You try to stand on the sidelines in the 1930s and we nearly lost civilization because of it. You got to step up. It's all of our fight.
KING: Jim, let me start with you, a great deal of criticism from Senator Kerry because of the president's approach. Do you think he has with any clarity, told the American people what would he do differently?
ELLIS: I think the one thing he is going for him right now is that perhaps with the change in administrations the foreign countries that have not wanted to side with the U.S. will look at that as a new opportunity to sort of forge sort of rapprochment with us.
I think that right now that's the only thing he really brings to the party, because a lot of the battle here is -- it's going to be the same battle.
KING: Is that a convincing message for Senator Kerry? Vote for me and the French will like us?
POWELL: It's got to be put more subtly, needless to say. But I think there is room for him to run here in the sense, if he can make the case saying, look, the Bush administration has basically trashed relations with too many allies. We've got to succeed in Iraq. I can make that happen in part, because I'm willing to be more inclusive in the decision making.
FORBES: That is going to beg the question. What sit that he would do differently? Put more troops in? Less troops? Where is he going to find the money? What's he going to do about North Korea? What's he going to do about Iran?
To say I'll talk more to our allies, we can talk a lot, but the bottom line is you have to do something. What would he do differently? He hasn't provided an answer yet. He has no answer.
KING: Let's turn our attention to the other big issue which is the economy. For the third week in a row initial jobless claims are down. Does that convince you that we are turning a corner, not in terms of growth, but in terms of jobs, something the president can campaign on, jobs. FORBES: I think jobs are starting to be created as businesses become convinced that this recovery is for real. I think there's going to be a bigger problem out there. We see it in gasoline prices and other things. These aren't isolated incidences. The fed went from deflation, sort of stalling the engine to flooding the engine. We've got an inflation problem. And the longer the fed doesn't do anything about it, the more we're going to read stories of shortage of shipping, the shortage of this, prices are going up. And that's going to be a mess more after the election, but it is going to be at the gas pump now.
KING: Do you see jobs coming into the economy?
ELLIS: I think Steve is right that we have hit bottom, but I don't think that's going to mean there's been a lot of job creation. There's been a lot of changes in the economy. And we've never had a recovery where we had the duel forces of China and India out there sucking jobs away from the U.S.. There are viable alternatives in a lot of areas. We never had that before so we can't use the past as a predictor of how the recovery is going to be.
KING: A different giant sucking sound than perhaps a campaign past. Can this president articulate a way to get away from this?
POWELL: The one thing I would say, we also have not had China as a market in the past, either, to sell U.S. goods to. And I think that's an important part of the equation. I think the president is on this issue hostage to the job numbers John, and you know. At this point I have to agree with Jim, I think it's clearly less than robust in terms of the job creation numbers and things don't hurry up, it's trouble.
KING: We need to end it on that note. Thank you, have a great weekend.
And a reminder to you, please check our Web site for the complete list of companies we've confirmed to be exporting America. It's at cnn.com/out.
And coming up next, the remarkable story of a group of high school students getting real life lessons in the business world. We'll tell you why they are part of "America's Bright Future" when we return. Please stay with us.
(COMMERCIAL BREAK)
KING: Now the results of tonight's poll question. 89 percent of you believe the war in Iraq has increased the global terror threat. 7 percent believe it has decreased that threat. And 4 percent believe it has made no difference at all.
All this week we've highlighted the brightest and most talented people from all across the country. Tonight we introduce to you a group of high school students from Colorado who run a credit union right in their school. Casey Wian has their story from Englewood, Colorado. (BEGIN VIDEOTAPE)
UNIDENTIFIED FEMALE: The winner is...
UNIDENTIFIED MALE: Katelyn Poselle in 7th grade.
CASEY WIAN, CNN CORRESPONDENT (voice-over): This student just won $40, part of a promotion by the Kent Denver School's Credit Union, which is run by high school students. A math teacher founded the operation in 1984.
DONNA DUVALL SERRANO, TEACHER SPONSOR: It gives them real financial knowledge. It gives them job experience. It gives them people skills.
WIAN: It's a real financial institution with nearly $2 million in deposits and 1,000 accounts held by students, parents, even teachers.
PATRICK JOBIIN, PRES. KENT DENVER CREDIT UNION: It's a great experience with banking and understanding how the financial world works. You know, we can deal with everything here. We see how interest rates work and dealing with cash. So it will definitely work if I do any type of profession which deals with money, which most do.
WIAN: 36 students operate the credit union, ranging from tellers to senior management, to a very unusual loan committee. They're considering a student's application for a debit card.
JOBIIN: I was wondering if anyone in here knows him very well.
UNIDENTIFIED FEMALE: I went to like preschool with him.
SERRANNO: Does he do his homework? Is he responsible?
WIAN: Kent Denver says it's only had a few defaults or delinquencies in two decades. Competition for the credit union jobs which pay $6 an hour, 8 during summer training, is fierce.
HILLARY HOFFMAN, V.P. TELLER SUPERVISOR: I would say the credit union is probably the No. 1 most competitive activity at Kent. I think we have 93 students applying for 20 spots this year.
WIAN: About 20 percent of them go on to jobs in banking or finance.
(on camera): Kent Denver's Credit Union is affected by some of the same forces as all financial institutions, including the sluggish economy. Its assets peaked at $2.4 million four years ago and have since dropped to 1.9 million.
(voice-over): Today they expected a minor run on deposits because it's the last day of school before spring break. Casey Wian, CNN, Englewood, Colorado.
(END VIDEOTAPE) KING: That's our show for tonight. Thanks for being with us. Lou will be back on Monday and he'll be talking with Mark Racicot, chairman of the committee to reelect President Bush.
My thanks to the fabulous staff of this show for putting up with me all week. For all of us here, have a great weekend. Good night from New York. "ANDERSON COOPER 360" up next.
TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com
President Bush Defends War in Iraq>
Aired March 19, 2004 - 18:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
(BEGIN VIDEOTAPE)
JOHN KING, CNN ANCHOR (voice-over): Tonight, a year of war. President Bush defends Operation Iraqi Freedom and says it has made the world a better place.
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: It's a good thing that the men and women across the Middle East looking to Iraq are getting a glimpse of what life in a free country can be like.
KING: Deputy Secretary of State Richard Armitage will be our guest and we'll talk to former Clinton National Security Adviser Samuel Berger.
Al Qaeda cornered. The battle intensifies between Pakistani troops and at least 300 al Qaeda fighters believed to be defending al Qaeda's second in command.
In "Heroes" tonight, a Vietnam veteran who has made it his mission to feed and give a much needed break to Americans wounded in Iraq and Afghanistan.
HAL KOSTER, OWNER, FRAN O'BRIEN STADIUM STEAKHOUSE: We are just making sure that these guys are treated a little better than we were when we got home.
KING: And "America's Bright Future." Tonight, a special report on a group of Colorado high school students learning about money by running their own credit union.
(END VIDEOTAPE)
ANNOUNCER: This is LOU DOBBS TONIGHT for Friday, March 19. Sitting in for the vacationing Lou Dobbs for an hour of news, debate and opinion, John King.
KING: Good evening.
President Bush today strongly defended the war in Iraq and has said it has made the world a safer place. However, the State Department is warning Americans it is -- quote -- "deeply concerned" that al Qaeda is planning to strike American targets around the world. The president's speech to officials from dozens of U.S. partners in the war on terror came exactly a year to the day when the war in Iraq began.
White House correspondent Dana Bash is live now at the White House with a report -- Dana.
DANA BASH, CNN WHITE HOUSE CORRESPONDENT: John, the president called this day one year ago when he ordered airstrikes into Iraq a day of deliverance, and he used the speech today to highlight what he said have been the good things that have come to Iraqi people.
He said no more torture chambers, no more mass graves. He made only a passing reference, though, to weapons of mass destruction. That was the central reason for going to war. And those, of course, have not yet been found. But some of the countries that opposed the war in Iraq were actually in the audience today represented there, like France and Germany. The president said that even if they disagreed they can all agree now the world is better off without Saddam Hussein.
(BEGIN VIDEO CLIP)
BUSH: There have been disagreements in this matter among old and valued for friends. Those differences belong to the past. All of us can now agree that the fall of the Iraqi dictator has removed a source of violence, aggression, and instability in the Middle East.
(END VIDEO CLIP)
BASH: Now, with the bombing last week of a train in Spain and a subsequent defeat of a key ally there, and, of course, bombings this week in Iraq, the administration has been working desperately behind the scene to try to keep the coalition there together.
And today, the president's message to more than 80 diplomats who were in the East Room here at the White House was that no country is safe from terrorism whether or not they supported the war in Iraq. And he said any sign of weakness will be seen as a retreat by the terrorists.
(BEGIN VIDEO CLIP)
BUSH: Each attack is designed to demoralize our people and divide us from one another. And each attack must be answered not only with sorrow, but with greater determination, deeper resolve, and bolder action against the killers.
(END VIDEO CLIP)
BASH: Now, Mr. Bush was speaking as much to American voters here who are divided whether or not Iraq was the right thing to do as he was to allies, and the president's political opponents immediately jumped on him saying that the war in Iraq wasn't necessary and that perhaps it has taken away from the broader war on terrorism -- John.
KING: And, Dana, the president himself and key deputies on his national security team working the phones today reaching out to key allies overseas. Is that routine or is that a sense of trepidation that there could be cracks in the coalition?
BASH: Well, we are told that there definitely is concern among people here at the White House that allies are getting a little bit skittish.
Dr. Rice, Condoleezza Rice, the national security adviser, has been working the phones all week long talking to key allies in Italy, her counterpart in France and elsewhere talking about the fact that they need to stay the course on the broader war on terrorism, but also specifically in Iraq. The president himself talked to the president of Poland today. They are trying desperately to keep that country from keeping their troops -- from taking their troops out of Iraq -- John.
KING: Dana Bash for us tonight at the White House, thank you very much.
And within an hour of the president's speech, several explosions rocked Baghdad. A senior military official said insurgents fired rockets or mortars that may have penetrated the heavily guarded coalition headquarters in Baghdad. No one was wounded. The attack came just hours after Secretary of State Colin Powell made an unannounced visit to coalition headquarters in the Green Zone. Powell acknowledged that there has been a spike in violence against the coalition and soft targets in Iraq, but he said the coalition will not be deterred.
(BEGIN VIDEO CLIP)
COLIN POWELL, SECRETARY OF STATE: This is not the time to say let's stop what we're doing and pull back. This is the time to redouble our efforts in every way, law enforcement activities, intelligence activities, and deal with this threat to the civilized world and not run and hide and think that it won't come and get us. It will come and get us.
(END VIDEO CLIP)
KING: Since the United States invaded Iraq one year ago, 572 American troops have been killed in the operation; 139 of them were killed during the initial campaign; 433 have died since the president declared the end of major combat in Iraq last May. The number of American troops in Iraq has dropped from 200,000 during the war to roughly 130,000 now.
Earlier today, Deputy Secretary of State Richard Armitage told me he expects that violence in Iraq to continue. We discussed international support for the war and how it has evolved over the last year. We'll have my conversation with the deputy secretary of state later in the broadcast. I'll also talk with former National Security Adviser Samuel Berger.
Democratic presidential challenger Senator John Kerry marked the anniversary by praising U.S. troops in Iraq and criticizing President Bush. Kerry released a statement from vacation in Idaho, calling American troops the best and the brightest. But Senator Kerry said President Bush has not told the truth about the war from the beginning and he said -- quote -- "It's time to take the targets off the backs of U.S. soldiers, reduce the burden on America's taxpayers and finish the job in Iraq" -- end quote. France's foreign minister is once again speaking out against the war in Iraq. Dominique de Villepin says the world is more dangerous now than it was before the invasion. De Villepin told the French newspaper "Le Monde" that terrorism did not exist in Iraq before the war. Now he says Iraq is one of the principal sources of global terror.
The United Nations is sending a team to Iraq as soon as possible. That team is going at the request of the Iraqi Governing Council and the U.S.-led coalition. And while the U.N.'s role in Iraq's future is still unclear, this will pose a crucial test for the organization.
Kitty Pilgrim has the report.
(BEGIN VIDEOTAPE)
KITTY PILGRIM, CNN CORRESPONDENT (voice-over): U.N. Secretary- General Kofi Annan and the U.S. Special Envoy to Iraq Lakhdar Brahimi said the U.N. was not looking for a job in Iraq.
LAKHDAR BRAHIMI, U.N. SPECIAL ENVOY TO IRAQ: I think the Iraqis in the Governing Council and out of the Governing Council are overwhelmingly demanding that the U.N. plays a role.
PILGRIM: The United Nations withdrew their team from Iraq after the bombing of their headquarters in August that killed, among areas, U.N. Envoy Sergio Vieira de Mello.
Now the U.N. is going back in to assist in the transfer of sovereignty to the Iraqis, scheduled for June 30. Iraq has been torn by particularly bloody bombings in event week. L. Paul Bremer, the head of the coalition provisional authority, says the attacks are directly related to the elections.
PAUL BREMER, U.S. ADMINISTRATOR IN IRAQ: I think it is quite likely that we will face a concerted effort by the terrorists between now and June 30.
PILGRIM: Looking at the U.N. track record in Afghanistan, where a U.N. team has been trying to organize voter registration, only about a tenth of voters have been registered, and Afghan President Hamid Karzai was forced to admit, because of that, elections planned for June could be delayed.
ABRAHAM SOFAER, HOOVER INSTITUTION: I think it will be easier to get the voters registered in Iraq than in Afghanistan. Although we are having a lot of security problems in Iraq, the overall security situation, the control of the country as a whole, is much more in the hands of the coalition authority and will be in the hands of the council and the Iraqi police and army by June 30.
PILGRIM: For that reason, the U.N. says general elections may be possible in Iraq by January of next year.
(END VIDEOTAPE) PILGRIM: Now, the U.N. may step in to an expanded role in Iraq in the future, for example, heading up some kind of coalition of multinational forces, but all of that is just talk at this point, John.
KING: Just talk, but talk that has intensified since the newly elected Spanish prime minister has said he will pull his troops out if there's no U.N. mandate?
PILGRIM: That's exactly right. And, as you know, he campaigned on that issue. And so it's a very important point for him. He has not backed down from that point.
KING: Much to be resolved still about the U.N. role.
Kitty Pilgrim, thank you very much.
And coming up next, fierce fighting between al Qaeda forces and Pakistani troops to capture a leader of the radical Islamist terrorist group. We'll talk to Deputy Secretary of State Richard Armitage and former National Security Adviser Samuel Berger.
Plus, in our feature series "Heroes," a hot meal and a night away from hospital food, courtesy of one veteran.
And March madness, but not on the basketball court. We'll have a special report on rising gasoline prices.
That and much, much more ahead. Stay with us.
(COMMERCIAL BREAK)
KING: Pakistani forces today say they will -- quote -- "finish the al Qaeda fighters at any cost."
Intense fighting continues in the mountains along Pakistan's border with Afghanistan. Pakistani officials believe they have cornered Osama bin Laden's top lieutenant. A Pakistani general today said his troops are prepared to use whatever means necessary to root out hundreds of al Qaeda fighters currently in hiding. He said, simply -- quote -- "The mission is to get these people dead or alive."
It's an operation of intense interest to U.S. military officials.
And CNN Pentagon correspondent Jamie McIntyre joins me now -- Jamie.
JAMIE MCINTYRE, CNN MILITARY AFFAIRS CORRESPONDENT: And, John, the U.S. is watching closely what is going on in Pakistan along that border region.
And we're told that the good weather, the clear skies has given the U.S. intelligence gathering apparatus a better look at what is going on, on the ground. Still, though, the best intelligence is coming from people on the ground, people captured by the Pakistani military and interrogated. That's where the evidence comes that Ayman al-Zawahri, Osama bin Laden's No. 2, may be among those people being protected by Islamic militants.
But today, U.S. government officials continued to say they don't know who, if anyone, is there. And that was a view echoed by U.S. Defense Secretary Donald Rumsfeld when he talked to CNN's Larry King in an interview that will be aired tonight.
(BEGIN VIDEO CLIP)
DONALD RUMSFELD, SECRETARY OF DEFENSE: Occasionally, when someone is captured, you can interrogate them and find out still additional information. I don't know -- the situation today, of course, in Pakistan has caused a lot of press attention. And it's not clear to me who is there, if anybody. But certainly there are an awful lot of fine Pakistani forces working hard.
(END VIDEO CLIP)
MCINTYRE: An awful lot of U.S. forces on the other side of the border waiting to see if anyone tries to escape over the border. The U.S. has Predator spy planes, unmanned spy planes flying long the border region, but it won't say if those planes are flying over Pakistani airspace.
However, if you go back to my original statement that U.S. officials say the clear skies are giving them a better view, you can put two and two together and pretty much figure out that the U.S. has some eyes in the skies over this situation -- John.
KING: Eyes in the skies, presumably perhaps even eyes on the ground. Jamie, the longer this goes on -- the anticipation rose, yesterday, of course. The longer this goes on, does that raise concern at the Pentagon that perhaps whoever this high-value target could be might have more time to get away?
MCINTYRE: Well, the conventional wisdom at the Pentagon is that in all likelihood there's a good likelihood that the people will slip away. It's just very hard in this kind of region to have a sort of hole-proof net around the area.
So there is a lot of concern about that. There's also concern about raising expectations. But I think the feeling is the longer it goes on and they're not able to get away the more likely they will be able to figure out who is there.
KING: Jamie McIntyre tonight for us at the Pentagon -- thank you, Jamie.
The president and vice president of Taiwan survived assassination attempts today in the southern city of Tainan. The two were campaigning ahead of Saturday's closely contested presidential election when they were shot. President Chen Shui-bian was shot in the stomach. Vice President Annette Lu was shot in the leg. Both were released from a hospital and an investigation is under way. Officials say Saturday's election will go on as scheduled.
And coming up next in "Heroes," one Vietnam vet shows his gratitude to soldiers wounded in Iraq with steaks and beer. We'll tell you why those soldiers are getting much more than a warm meal.
And as the war in Iraq reaches the war in Iraq reaches the one- year mark, I'll talk with Deputy Secretary of State Richard Armitage and former Clinton National Security Adviser Samuel Berger about what's ahead in the global war on terror.
(COMMERCIAL BREAK)
KING: Every Friday night at a steakhouse called Fran O'Brien's in Washington, D.C., a group of soldiers get together for dinner and drinks on the house. They are the soldiers of Ward 57 at the Walter Reed Army Medical Center, the amputee ward.
Lisa Sylvester has their story.
(BEGIN VIDEOTAPE)
KOSTER: You doing all right, man?
UNIDENTIFIED MALE: Yes, I'm doing fine.
KOSTER: How you doing tonight
LISA SYLVESTER, CNN CORRESPONDENT (voice-over): Hal Koster, the owner of Fran O'Brien's in Washington, D.C., thought a decent meal was the least he could do for the soldiers injured in Iraq and Afghanistan. So he started the Friday suppers last October. Hal can relate to what they have been through. He's a Vietnam vet.
KOSTER: We are just making sure that these guys are treated a little better than we were when we got home. That's all.
SYLVESTER: When the dinners first started, only one guy showed up, the next week, a couple more. Now they regularly feed more than 40 people. Even the occasional celebrity shows up.
(on camera): These soldiers appreciate not having to eat hospital food one night out of the week. But what they really enjoy is talking to others who understand what they are going through.
SGT. MICHAEL CAIN, U.S. ARMY: Everyone enjoys themselves over here, and everybody loves it here. And their morale is really good.
SYLVESTER: Staff Sergeant Daniel Metzdorf lost his leg when a bomb detonated southwest of Baghdad in late January. He's grateful to be alive. Three other soldiers died that day.
STAFF SGT. DANIEL METZDORF, U.S. ARMY: I lost my limb, but that's nothing. The hospital has given me a brand new leg. It's a small injury compared to what some of these guys have gone through.
SYLVESTER: Alex Leonard's convoy was attacked in Iraq. The Humvee he was driving was hit by a roadside bomb. When he looked down, he was missing his right leg.
SPC. ALEX LEONARD, U.S. ARMY: Actually, I'm glad it was me than one of the other guys that we were with.
SYLVESTER: These soldiers have no regrets.
METZDORF: They came and asked me, if I had one wish, my one wish would be to go back over with my soldiers in Iraq and just do what I love doing.
SYLVESTER: Their brush with death makes them cherish the things that matter, their love for their country, their love for their families and the companionship of good friends.
Lisa Sylvester, CNN, Washington.
(END VIDEOTAPE)
KING: What a great piece.
Tonight's thought is on heroes. "Nurture your mind with great thoughts. To believe in the heroic makes heroes" -- those words from the former British Prime Minister Benjamin Disraeli.
And coming up, Iraq one year later. Deputy Secretary of State Richard Armitage and former Clinton National Security Adviser Samuel Berger will join us. Then, the exporting of America pits big business against small and local communities against national organizations. We'll have a special report tonight.
And whatever happened to buy American? Presidential campaign merchandise imported from a country now under U.S. trade sanctions. That story and a great deal more still ahead.
(COMMERCIAL BREAK)
KING: Earlier today, I discussed the war in Iraq and the broader war on terror with the No. 2 man at the State Department, Deputy Secretary Richard Armitage. And I began by raising the French foreign minister's complaint that in his view the Iraq war has increased the terrorist threat.
(BEGIN VIDEOTAPE)
RICHARD ARMITAGE, DEPUTY SECRETARY OF STATE: I think I simply disagree. Terrorism had emanated from Iraq before a year ago. There is still a great battle going on there now. And if we're successful -- and we fully intend to be successful -- the Middle East and indeed the world will be a much safer place.
KING: More bombings in Baghdad today, some violence over the past 72 hours or so leading up, if you will, to the one-year anniversary. What is your sense. Who is doing this and why?
My own view is that this violence that we're seeing will continue, certainly, to try to disrupt the turnover of sovereignty to Iraqis on 1 July. I think the closer we get to that date, the closer Iraq is to being a multiethnic, multireligious society, well on the path to democracy, the more it threatens the interest of those who do not want to see a secular government.
So, to answer the first part of your question, clearly, there are some of the former regime elements. But more and more, it looks like other outsiders who are intent on destroying secular governments are doing the violence.
KING: Saddam Hussein has been in the custody of the United States for quite some time now. Is the United States learning anything meaningful from him at all? And I understand from your comments in recent days, sir, you think he's being a bit of a wise guy?
ARMITAGE: Well, I have felt he's been a wise guy for some time and it certainly appears he's being that way now with his interlocutors.
But, as I also said in recent days, I think we are going to have a while before we can connect all the dots in what he's telling us. And clearly, whatever he tells us will have to be checked against other people's recollection and intelligence that is collected ton ground.
KING: Is he cooperating at all or is he simply debating?
ARMITAGE: Well, I don't know since I wasn't personally involved that I can characterize it. I would say that he appears to be enjoying himself.
KING: Since the election in Spain and the change of government, the newly elected prime minister says he will pull his troops out. He has said that he believes the Bush administration's approach to the war on terrorism has been a failure, that in fact that violence and the use of military force is inspiring more terrorism. Romano Prodi at the European Union has said the same thing, Mr. de Villepin today.
Is there a debate among long-standing allies of this country, the United States, about the strategy, the Bush administration's strategy, and how would you answer those critics?
ARMITAGE: We were attacked wantonly on 9/11.
And we decided we're not going to take it anymore. And President Bush summoned a mighty coalition to kick the Taliban out of sanctuary and kick al Qaeda out of sanctuary in Afghanistan. So clearly those who you think that you can conquer the global war on terrorism without some resort to military force are dead wrong.
KING: It's a debate not only overseas, a debate in this country now in the middle of a presidential campaign in which the president's Democratic opponent, Senator John Kerry, says the approach is a failure. And he says that the administration, including your State Department, sir, have been stubborn and arrogant, sticking to a policy that he says is a failure and driving away allies. How would you answer him?
ARMITAGE: Well, I attended the president's speech today. And I noticed the flags of 84 countries arrayed behind the president. These are the 84 nations in the world who are with us in the global war on terrorism. So I think that graphic demonstration or tableau ought to answer Senator Kerry's remarks.
KING: I want to turn our attention, sir, to the military operation under way along the Pakistan-Afghanistan border. Very hard to get definitive information out of there, but sources within Pakistan say they believe they have surrounded up in that remote area Osama bin Laden's No. 2, Ayman al-Zawahri. Do we have any reliable information that that is the case, sir, and what do you know about that operation?
ARMITAGE: Yes, the Pakistanis have told us the same thing. I have no independent corroboration.
It is the case, however, that there seems to be quite a battle going on and the Pakistani forces have committed a large amount of energy and commitment of people to the prosecution of those who are destabilizing Pakistan as well as Afghanistan.
KING: What would be the significance if it, in fact, is bin Laden's No. 2? And as you answer the question, how much U.S. resources involved in helping here?
ARMITAGE: Well, I don't think I'm inclined to answer the second part.
But, on the first part, I think it would be important, but it is certainly not going to stop terrorism. We believe we've got about three-quarters of the higher-ranking al Qaeda leadership dead or locked up. I think it would be a good psychological blow to be able to take down Zawahri and Osama bin Laden, but that in itself is not going to stop terrorism.
As the director of our Central Intelligence Agency, Mr. Tenet, indicated recently, with the greater difficulty that the leadership of al Qaeda is having directing terrorism, it seems that al Qaeda cells have become somewhat more regionally oriented and somewhat more autonomous.
(END VIDEOTAPE)
KING: Our thanks to the deputy secretary of state, Richard Armitage.
And that brings us to the topic of tonight's poll question: Do you believe the war in Iraq has increased or decreased the global terror there, increased, decreased, or no difference? Cast your vote at CNN.com/Lou. We'll bring you the results later in the program.
Former Clinton White House National Security Adviser Samuel Berger is among those advising Democratic Senator Kerry.
I spoke to Mr. Berger a short time ago and asked him if he believes President Bush has an effective exit strategy for Iraq. (BEGIN VIDEOTAPE)
SAMUEL BERGER, FORMER NATIONAL SECURITY ADVISER: If he does, I don't think we have seen it yet.
I think it's extraordinarily important that we succeed in Iraq, whether one was for this war or against this war. An Iraq that descends into chaos and turmoil would be a disaster for the region and a disaster for the world. And, conversely, an Iraq that came together and was stable and pluralistic would be healthy for the region. So we've got a lot at stake here.
But we're going to turn sovereignty over on June 30 to the Iraqis, but we don't know what Iraqis or what form this will take. And, essentially, we're going to sign a certificate of title to the Iraqis and we don't know who, what, or what form that will take. That doesn't sound to me like a plan.
KING: The president in his speech said he wanted to let bygones be bygones. He specifically mentioned Germany and France. But the French foreign minister today said that, in his view, the Iraq war has increased the terrorist threat in the world, not decreased it, as President Bush would say. Who do you agree with?
BERGER: Well, I don't think that we're any safer from terrorism today than we were before the Iraqi war. I don't think that Iraq and Saddam Hussein was involved in September 11 or tied to al Qaeda. I do think that the fact that we've done this basically alone, without allies, without much of a plan for the occupation, has created a cauldron, and it has become magnet for terrorists from around the world, and a source of great resentment to the United States as demonstrated by the most recent survey research by the Pew Group, showing our ratings falling all around the world.
So I don't think we are safer today from terrorism than we were before the Iraqi war.
KING: You say you don't think we're any safer from terrorism today. That is one of the great debating points in this race for president. And in trying to make that contrast, the Bush administration suggests that Senator Kerry would go from the war approach, the aggressive, proactive approach of the Bush administration, to treating the war on terrorism more like a law enforcement matter.
I want you to listen to something Condoleezza Rice, your successor as national security adviser in the White House, said yesterday, how she defines this choice.
(BEGIN VIDEO CLIP)
CONDOLEEZZA RICE, NATIONAL SECURITY ADVISER: Whether the right response to the act of war that was committed against this country on September 11, when they went after the Twin Towers and the Pentagon, and perhaps the Capitol and the White House were on the list, whether that act of war is going to be answered by an American strategy that is bold and decisive and takes the fight to them, or whether we're going to go back to days when we thought that principally this was a law enforcement action and we would use kind of minimal military force once in a while.
That's what led to September 11. It was the fact that the country was not really mobilized to take on the war that had been launched against us.
(END VIDEO CLIP)
KING: Samuel Berger, sounds not only like a criticism of Senator Kerry, but also a criticism of your days in the Clinton White House.
BERGER: Well, I think it's a total red herring. First of all, I don't there's any administration, Democrat or Republican, or Green, for that matter, that would not have responded to September 11 with the full force of American power.
We never had a law enforcement -- we did not law enforcement approach even before September -- during the Clinton administration. We used all of the tools at our disposal in the pre-9/11 context from cruise missiles to diplomacy. There is a role for the FBI to investigate. But I think that's really a bumper sticker. It's not an argument.
KING: What is your sense today -- the president had 80-some nations invited to the East Room today. He had all the flags behind him. He says there is a thriving coalition in the war on terrorism. Of course, the newly-elected Spanish prime minister has said he would pull his troops from Iraq. He calls that a fiasco. He says that the use of military force is only increasing and inspiring the terrorists.
What is your assessment on this day of the current status of the war and the president's international support in it?
BERGER: I think we're losing altitude rather than gaining altitude. I think we're losing allies rather than gaining allies. I'm very sorry to see the Spanish withdraw from Iraq because I think it's important that they stay. But that's a fact. We had the Poles wavering whether they will go or stay.
You know, you can put a lot of countries -- I'm sure the Marshall Islands, which is part of our coalition, was in the White House today. The fact is that over 80 percent of the troops in Iraq are us and the British. And if you take the British out, over 90 percent are American, and about 80 percent are us and the British. So this is a coalition mostly in name.
The fact of the matter is, on the ground, there are Americans, some Brits and a smattering of others.
KING: Well, then finish this sentence for me in closing. You are an adviser to the Kerry campaign. This is a key issue in this presidential campaign. Finish this sentence then for me. You believe that Senator Kerry would be more effective in leading the war on terrorism than President Bush because... BERGER: Because I think it will take a new president to strike a new bargain with our allies which says, we're prepared to share decisions if you're prepared to share the risks.
KING: Samuel Berger, former national security adviser in the Clinton administration. Sir, thank you very much for your time.
BERGER: Thank you, John.
KING: When we return, march madness at the gas pumps. And some say the worst is still to come. We'll have that report up next.
(COMMERCIAL BREAK)
KING: Crude oil prices resume their march higher today, closing at just under $38 a barrel. That means more upward appreciate on gasoline prices here in the United States. That, of course, means more unhappy motor is. Peter Viles has that report.
(BEGIN VIDEOTAPE)
PETER VILES, CNN CORRESPONDENT: March Madness, sweeping the country. No, not on the basketball court but at the bump. Los Angeles full service premium, that's right, $2.89 a gallon.
UNIDENTIFIED MALE: I think they are outrageous. I don't think there's any reason for it.
VILES: New York City, $2 a gallon and higher.
UNIDENTIFIED MALE: They are way too high. It's ridiculous. Sometimes they go up the next thing you know they will bring them down a little bit. When you turn around they bring them up even more.
VILES: Months before the summer driving season gasoline prices are spiking. $1.74 on average across the country. $1.91 in New York, over $2 a gallon in Las Vegas and Los Angeles. One reason, a patchwork system of different gasoline blends and regulations in different states.
PETER BEUTEL, OIL ANALYST: We have too many different grades of gasoline particularly in the summer. If you deliver gasoline in New York Harbor, on one side of the river in New Jersey, you are delivering gasoline with MTBE, if you deliver it in New York you are delivering it with ethanol.
VILES: But the problem is also global. Demand is rising and supply is not because OPEC is holding back production. Much of the new demand comes from China, tens of millions of Chinese discovering the joys of the automobile.
GUY CARUSO, ADMINISTRATOR ENERGY INFORMATION ADMIN.: We are thinking China may have grown as much as 400,000 barrels a day last year, which is about almost one-third of the growth in global oil demand. VILES: Crude prices have shot up 40 percent since September are now higher than they were a year ago when the U.S. attacked Iraq. Iraq's oil is flowing, but the continuing turmoil there is helping to keep global prices high.
(on camera): This price squeeze at the pump is likely to get worse before it gets better. The Bush administration now says it expects gas prices to rise another 10 cents per gallon over the next two months. Peter Viles, CNN, New York.
(END VIDEOTAPE)
KING: An editorial cartoon in today's papers perhaps helps capture some of the anxiety. It shows a brink's armored truck that has been robbed. The caption underneath, "no, they left the money but they siphoned all our gas." Our thanks to syndicated cartoonist, Bill Schur (ph).
Another steep selloff on Wall Street. The Dow tumbled nearly 110 points. The Nasdaq fell 22 points, the S&P 500 lost more than 12. Today Christine Romans joins us now.
CHRISTINE ROMANS, CNN FINANCIAL CORRESPONDENT: And now the Nasdaq is down 8 of the last nine weeks. It's been a tough run overall, 9 percent the Nasdaq is down in that time. And for this week, the Nasdaq well 2 percent, the Dow is down another half a percent and the S&P 500, John, is now down two weeks in a row, that hasn't happened since late last year.
This job market mystery still has economists scratching their head. We learned this week the jobless line is the shortest since early 2001. Economists say that indicates the firings have slowed, but high productivity, outsourcing and cautious CEOs have kept hiring minimal and they are more than 3 million long-term unemployed people. That number rose in the latest week. That doesn't include the half a million that dropped off the roles when their extended benefits expired in December. And it also doesn't count the discouraged workers. The hiring hasn't happened yet. And John, no one, still, knows when it will.
KING: So, Christine, we spent a lot of time this part of the program talking about corporate and executive greed, a cheery story on a Friday?
ROMANS: I have a cheery story for you. The CEO of Ford is going to give his bonus to his workers. It is about $1.5 million and it will go toward tuition assistance for employees' kids. He said he wanted to thank his employees for the company's performance last year. He doesn't take a salary but no crying for Bill Ford, he obviously is related to the founder of the countries. He has his own 2.7 million shares of company stock. But he will give up his restricted stock bonus, about $1.5 million to employees.
KING: A nice thing to do. Christine Romans, thank you very much. Have a great weekend.
Now for a look at some of your thoughts on exporting America.
Michael Howard of Royal Palm Beach, Florida writes, "With millions of Americans slated for retraining, how much does it cost to train people to ask, you want fries with that?"
Wayne of Raleigh, North Carolina, "Thanks for providing a voice for the few middle-class workers left in America. The issue is jobs, the backbone of America is our ability to work and support our families."
On America's foreign policy and the war on terror. Kathy of Denver, Colorado. "I was dismayed to hear Condoleezza Rice link the September 11 attacks to Iraq and Saddam Hussein. It is misleading to continue to suggest that the Iraq war had anything to do with al Qaeda."
And Deborah Gabel of Newport Beach, California, "Taking an offensive position reflects decisive action. We can be proud that the United States showed leadership and the ability to make a decision rather than to wait, see, which red, yellow, or orange alert we could bow to today."
We love hearing from you always. Email us at loudobbs@CNN.com. And a reminder now to weigh in on tonight's poll question. "Do you believe the war in Iraq has increased, decreased, or made no difference to the global terror threat." Cast your vote at CNN.com/lou. We'll bring you the results a bit later in the show.
When we return, exporting America, presidential products made by cheap foreign labor. Critics blast the Bush administration for not being made in America.
The issue of trade is creating a sharp political debate in an already intense election year. We'll take a look at the divisions forming within several national organizations.
(COMMERCIAL BREAK)
KING: The debate over the exporting of American manufacturing to cheap foreign labor markets has caused a deep divide within American business, smaller manufacturers are increasingly at odds with their larger counterparts over the issue. Now some local businesses are fighting back, Bill Tucker reports.
(BEGIN VIDEOTAPE)
BILL TUCKER, CNN CORRESPONDENT: Trade is rarely personal, it is ships and cargo. The closest it gets to personal for most people is a lower price. Not so for many small and medium-sized manufacturers. They take trade very personally and they are angry, frustrated with groups like the National Association of Manufacturers.
PETER DIVENERE, DEMCO MANUFACTURING: Maybe because they don't have to meet a payroll every week and they don't work with 35 people on the floor every day and have to face them and tell them that layoffs are coming down. The work is being stepped up offshore. TUCKER: The National Association of Manufacturers responds to the criticism being leveled at it by noting that the problem is not trade. The problem is runaway healthcare and energy costs.
MICHAEL BAROODY, If we don't address the cost that government could do something about from healthcare to regulation to taxes to litigate the legal system, then we will continue to lose jobs.
TUCKER: Dissatisfied manufacturers are not alone. At the local level many Chamber of Commerce groups share the feeling of disappointment in their group's efforts to keep jobs in America. The National Chamber says it understand the frustration but says the trade is our future and to that end it has programs designed to show smaller towns of businesses how to adapt.
LESLIE SCHWEITZER, U.S. CHAMBER OF COMMERCE: This is very hands on. This is not something that we go in and do a program and then we leave. We are very actively involved in helping these small businesses to understand the resources, both federally and privately.
TUCKER: And that's great, but that's cold comfort to a town where Thompson (ph) just closed its television tube plant and laid off 1,000 workers.
AARON DEWEESE, MARION, IND. CHAMBER OF COMMERCE: I'm worried about the mom and pop businesses that -- that are certainly going to feel the loss of an estimated 36 million dollars in wages that the Thompson workforce represented.
TUCKER: The Marion Chamber of Commerce is planning to take its case to Washington, D.C. personally. Bill Tucker, CNN, New York.
(END VIDEOTAPE)
KING: A bit of an embarrassment today for the Bush-Cheney campaign. The campaign is selling fleece pull-overs that were made in Myanmar, a country formerly known as Burma. President Bush banned imports from that country last year citing a repressive military regime and human rights violation.
According to a statement from the Bush-Cheney campaign the manufacturer of the jackets said the order was a mistake. The Bush- Cheney camp said that it is committed to making sure that only products made in the U.S.A. are sold on its website. And joining me now for more on all of the week's big developments, tonight's newsmakers. Steve Forbes, editor-in-chief of "Forbes" magazine, Jim Ellis, chief of correspondents at "Businessweek" and Bill Powell, managing editor at "Fortune."
Gentlemen, it was one year ago tonight that the bombing started in Iraq. Steve Forbes, one year later, are you confident that this president has an exit strategy?
STEVE FORBES, "FORBES": I think he has a winning strategy on the war against terror. Not only do you have a critical country in the Middle East that is going in a liberal Democratic path for the first time in that region, outside of Israel, Libya has finally 'fessed up to their weapons of mass destruction. The Iranians are under pressure and the North Koreans are in disarray so in totality, the war on error it's been a huge progress in the past 12 months.
KING: Do you agree with that, an exit strategy for Iraq specifically?
JIM ELLIS, "BUSINESSWEEK": I don't think we have an exit strategy yet. The coalition of the willing that we sort of trumpeted a lot about hasn't turned out to be much of a coalition. I think we have seen now with the change of government in Spain and also the sort of reticence by the polls. We don't quite know how we're going to get out of this. I think we're right, but unfortunately we sort of underestimated the difficulty in actually making this work.
KING: Do you think a year ago, tonight, the president would have thought that they would not have a plan, yet, a firm plan for turning power to a new Iraqi government, that you would still had violence like this?
BILL POWELL, "FORTUNE": No. I think he thought that there would not be violence like this and presumably that they would have a plan. That part of the equation is discouraging. I would say on the question of whether there's an exit strategy if there is one, already, then Iraq is in more trouble than we think. The fact is, we -- hopefully with NATO and the United Nations need to be there at least in a military sense and we need to be there for a long time to come. That's, I think, what the administration has got to tell people.
KING: Let's stick on the point of international support. An interesting week. The elections in Spain, then you have Romano Prodi of the European Union and now the French foreign minister not only questioning the war in Iraq but the whole strategy against terrorism saying that military force is in their view creating more terrorists, not rooting out the terrorists. How does that affect how the president carries this forward?
POWELL: I think it's not going to affect at lee in the short term what President Bush strategy is. I think he is eagerly seeking to internationalize the effort in Iraq. You know, we'll see what -- whether the U.N. steps up to the plate there or not. I think that's still in play.
KING: And how does that ripple, the international questions coming in the middle of a U.S. presidential campaign.
ELLIS: I think it puts the pressure on the president to actually sort of get some international support behind this. That's one of the things the Democrats are hammering him about. The problem is that it's very difficult right now for a lot of Europeans to see that our battle is basically their battle also.
That basically the fight against terrorism and the fight against the sort of destabilizing forces in the Mideast is against the western way of life, it's against individual freedoms, women's rights, capitalism and basically whether they like it or not, whether they like the United States or not, their battle is the same one as ours.
KING: The United Nations team is about to go back in. Do you think this administration is prepared to give significant power to the United Nations and do you believe the U.N. is up to the job?
FORBES: The answer is, I hope they don't give too much power to it, because the U.N. elsewhere in most other parts of the world have made a mesh of it, you see it in Haiti and elsewhere, they are not up to the job. Ultimately, it is going to be in our court no matter who we bring with us.
I think Jim is exactly right, we have to do a better job in explaining to the European public this is a war against women, what al Qaeda is doing, it's a war against civilization. You try to stand on the sidelines in the 1930s and we nearly lost civilization because of it. You got to step up. It's all of our fight.
KING: Jim, let me start with you, a great deal of criticism from Senator Kerry because of the president's approach. Do you think he has with any clarity, told the American people what would he do differently?
ELLIS: I think the one thing he is going for him right now is that perhaps with the change in administrations the foreign countries that have not wanted to side with the U.S. will look at that as a new opportunity to sort of forge sort of rapprochment with us.
I think that right now that's the only thing he really brings to the party, because a lot of the battle here is -- it's going to be the same battle.
KING: Is that a convincing message for Senator Kerry? Vote for me and the French will like us?
POWELL: It's got to be put more subtly, needless to say. But I think there is room for him to run here in the sense, if he can make the case saying, look, the Bush administration has basically trashed relations with too many allies. We've got to succeed in Iraq. I can make that happen in part, because I'm willing to be more inclusive in the decision making.
FORBES: That is going to beg the question. What sit that he would do differently? Put more troops in? Less troops? Where is he going to find the money? What's he going to do about North Korea? What's he going to do about Iran?
To say I'll talk more to our allies, we can talk a lot, but the bottom line is you have to do something. What would he do differently? He hasn't provided an answer yet. He has no answer.
KING: Let's turn our attention to the other big issue which is the economy. For the third week in a row initial jobless claims are down. Does that convince you that we are turning a corner, not in terms of growth, but in terms of jobs, something the president can campaign on, jobs. FORBES: I think jobs are starting to be created as businesses become convinced that this recovery is for real. I think there's going to be a bigger problem out there. We see it in gasoline prices and other things. These aren't isolated incidences. The fed went from deflation, sort of stalling the engine to flooding the engine. We've got an inflation problem. And the longer the fed doesn't do anything about it, the more we're going to read stories of shortage of shipping, the shortage of this, prices are going up. And that's going to be a mess more after the election, but it is going to be at the gas pump now.
KING: Do you see jobs coming into the economy?
ELLIS: I think Steve is right that we have hit bottom, but I don't think that's going to mean there's been a lot of job creation. There's been a lot of changes in the economy. And we've never had a recovery where we had the duel forces of China and India out there sucking jobs away from the U.S.. There are viable alternatives in a lot of areas. We never had that before so we can't use the past as a predictor of how the recovery is going to be.
KING: A different giant sucking sound than perhaps a campaign past. Can this president articulate a way to get away from this?
POWELL: The one thing I would say, we also have not had China as a market in the past, either, to sell U.S. goods to. And I think that's an important part of the equation. I think the president is on this issue hostage to the job numbers John, and you know. At this point I have to agree with Jim, I think it's clearly less than robust in terms of the job creation numbers and things don't hurry up, it's trouble.
KING: We need to end it on that note. Thank you, have a great weekend.
And a reminder to you, please check our Web site for the complete list of companies we've confirmed to be exporting America. It's at cnn.com/out.
And coming up next, the remarkable story of a group of high school students getting real life lessons in the business world. We'll tell you why they are part of "America's Bright Future" when we return. Please stay with us.
(COMMERCIAL BREAK)
KING: Now the results of tonight's poll question. 89 percent of you believe the war in Iraq has increased the global terror threat. 7 percent believe it has decreased that threat. And 4 percent believe it has made no difference at all.
All this week we've highlighted the brightest and most talented people from all across the country. Tonight we introduce to you a group of high school students from Colorado who run a credit union right in their school. Casey Wian has their story from Englewood, Colorado. (BEGIN VIDEOTAPE)
UNIDENTIFIED FEMALE: The winner is...
UNIDENTIFIED MALE: Katelyn Poselle in 7th grade.
CASEY WIAN, CNN CORRESPONDENT (voice-over): This student just won $40, part of a promotion by the Kent Denver School's Credit Union, which is run by high school students. A math teacher founded the operation in 1984.
DONNA DUVALL SERRANO, TEACHER SPONSOR: It gives them real financial knowledge. It gives them job experience. It gives them people skills.
WIAN: It's a real financial institution with nearly $2 million in deposits and 1,000 accounts held by students, parents, even teachers.
PATRICK JOBIIN, PRES. KENT DENVER CREDIT UNION: It's a great experience with banking and understanding how the financial world works. You know, we can deal with everything here. We see how interest rates work and dealing with cash. So it will definitely work if I do any type of profession which deals with money, which most do.
WIAN: 36 students operate the credit union, ranging from tellers to senior management, to a very unusual loan committee. They're considering a student's application for a debit card.
JOBIIN: I was wondering if anyone in here knows him very well.
UNIDENTIFIED FEMALE: I went to like preschool with him.
SERRANNO: Does he do his homework? Is he responsible?
WIAN: Kent Denver says it's only had a few defaults or delinquencies in two decades. Competition for the credit union jobs which pay $6 an hour, 8 during summer training, is fierce.
HILLARY HOFFMAN, V.P. TELLER SUPERVISOR: I would say the credit union is probably the No. 1 most competitive activity at Kent. I think we have 93 students applying for 20 spots this year.
WIAN: About 20 percent of them go on to jobs in banking or finance.
(on camera): Kent Denver's Credit Union is affected by some of the same forces as all financial institutions, including the sluggish economy. Its assets peaked at $2.4 million four years ago and have since dropped to 1.9 million.
(voice-over): Today they expected a minor run on deposits because it's the last day of school before spring break. Casey Wian, CNN, Englewood, Colorado.
(END VIDEOTAPE) KING: That's our show for tonight. Thanks for being with us. Lou will be back on Monday and he'll be talking with Mark Racicot, chairman of the committee to reelect President Bush.
My thanks to the fabulous staff of this show for putting up with me all week. For all of us here, have a great weekend. Good night from New York. "ANDERSON COOPER 360" up next.
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President Bush Defends War in Iraq>
