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Lou Dobbs Tonight

Vice President Dick Cheney and Democratic Senator Zell Miller to speak at Republican National Convention, Category four hurricane approaching Bahamas, Radical Islamists hold hundreds hostage in southern Russia

Aired September 01, 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.


ANNOUNCER: this is LOU DOBBS TONIGHT for Wednesday, September 1. Here now for an hour of news, debate, and opinion is Lou Dobbs.
LOU DOBBS, HOST: Good evening.

Tonight, we're following a number of rapidly developing stories.

Delegates at the Republican National Convention tonight are expecting an all-out assault on the Democrats from Vice President Dick Cheney and Democratic Senator Zell Miller. We'll have that story for you.

And a category four hurricane is now approaching the Bahamas. It's barreling towards the east coast of Florida, with wind gusts of up to 185 miles an hour, sustained winds of 140 miles an hour. We'll have the latest update for you from the National Hurricane Center. The director of the center, Max Mayfield, will be with us.

And radical Islamist terrorists tonight holding hundreds of children and adults hostage in southern Russia. We'll have a report for you on that as well.

We begin tonight, though, with the Republican National Convention, where Vice President Dick Cheney will blast the Democrats and Senator Kerry in a primetime speech. Vice President Cheney is expected to say that this election comes at a defining moment in our country's history. Another primetime speaker is longtime Senator Zell Miller of Georgia. Senator Miller will tell this convention why he switched his loyalties to President Bush.

White House correspondent Dana Bash is with the Georgia delegation on the floor of Madison Square Garden, joining us now with the story. Dana?

DANA BASH, CNN WHITE HOUSE CORRESPONDENT: Well, Lou, again tonight we are going hear some high-profile testimony about why it's important, they think here, for George W. Bush to be commander in chief for another four years.

Vice President Cheney, of course will be the lead speaker on that issue. He is going to say, as you mentioned, that it is a defining moment in history, and that is why he thinks that George W. Bush is the man to lead. He also will say it's very much like it was after World War II, and that this is something that Americans must keep in mind, that he is the leader, not the Democrat on the other side.

He'll also go through what he calls a record of achievement in the Bush administration, domestic issues like education and tax cuts, also national security, a record he will say, is in sharp contrast to that of Democratic John Kerry. He'll say, quote, "And on the question of America's role in the world, the differences between Senator Kerry and President Bush are the sharpest, and the stakes for the country are the highest."

Now, aides say about 20 percent of the vice president's speech will be aimed at denouncing John Kerry and his candidacy. That is tradition for vice presidents. They generally give the sharpest attacks.

What is not tradition is to get an attack from somebody on the same side of the opponent. That is what we're going to get tonight here at the Republican convention, a Democrat, Zell Miller. He will be talking tonight about why he's crossing party lines to support George W. Bush for president.

He stood here in Madison Square Garden 12 years ago as a keynote speaker in the nominating convention of President Bill Clinton, at the time Candidate Bill Clinton. There he slammed the first President Bush, saying that he simply didn't get it on big issues like the economy.

Now he says the son needs another four years as president, not his fellow Democratic senator, John Kerry. Says he's not up to the job, saying, quote, "Right now, the world just cannot afford an indecisive America. Fainthearted self-indulgence will put at risk all we care about in this world. In this hour of danger, our president has had the courage to stand up, and this Democrat is proud to stand up for him."

Now, Democrats are infuriated by this, of course, as you can imagine. Nationally in his home state, they're actually running an ad with some of his speech from 1992 slamming first President George W. Bush. Republicans here at the convention, though, even though who've spent decades running against Zell Miller, as you can imagine, Lou, are quite happy to have him here.

DOBBS: We'll be looking forward to it. Thank you very much, Dana Bash from the floor of Madison Square Garden.

President Bush will arrive in New York City tonight to attend his convention, but first, he made one more campaign visit, this one to Ohio, of course, a key battleground state, the president's final stop on a nine-state journey to the convention. Tonight the president will meet with New York firefighters in the borough of Queens. The president will then speak to the convention tomorrow evening.

Senator John Kerry today struck back at his Republican critics. Senator Kerry said extremism has gained momentum in Iraq because of the Bush administration's policies. Senator Kerry also said the war on terror can be won, but only with the right policies. This presidential election is now only two months away. Some Democrats are expressing concern that Senator Kerry may be losing ground to President Bush. Some Democrats, in fact, are calling for changes in Senator Kerry's campaign staff.

Joining me now is the Democratic National Committee chairman, Terry McAuliffe.

Terry, good to have you with us.

TERRY MCAULIFFE, CHAIRMAN, DEMOCRATIC NATIONAL COMMITTEE: Good to be with you, Lou.

DOBBS: The -- let's start with the calls now for changes in the Kerry campaign. There have been missteps, as there are with any presidential campaign, but a lot of top Democrats are now talking privately and some publicly about changes. What do you think?

MCAULIFFE: Well, the campaign has clearly said there will not be any changes. There will be additions. I mean, we are now about 60 days away from the election We're headed into the fall campaign. I mean, many of the political operatives who had other jobs and other family considerations are now saying it's time to come into the campaign.

So you'll see a big expansion of getting people into the campaign to help us do the final 60 days. This election is so tight. It's going to, you know, be tight right up to the end, Lou. But we got to get all hands on deck.

John Kerry has told me from day one, Terry, all hands on deck. Everybody in this campaign, let's go. And that's what we're going to do.

DOBBS: Everyone is going. I, the Republicans with whom I speak, the Democrats with whom I speak, all acknowledge that there's about a 2 percentage point variance here in the vote. How in the world is Senator Kerry, challenging an incumbent president, going to capitalize and drive forward his message in presumably in an effort to win in November?

MCAULIFFE: Well, John Kerry's whole campaign is built upon, you know, creating 10 million new jobs his first term in office, tax cut for 99 percent of the taxpayers. I mean, when you have George Bush out there with the record he has to defend, he consistently is under 50 percent. Only 40 percent of Americans, Lou, think the country is headed in the right direction.

And today, the secretary of labor coming out and saying it's a great thing we outsource our jobs. I mean, go to Canton, Ohio, where the Timkin (ph) plant was just shut down. You tell those workers that it's a good thing to ship their jobs overseas. Or Fort Smith, Arkansas, the Whirlpool plant, all the layoffs there.

We need a president who's focused on all Americans out there. Many Americans have lost their job, they've lost their health and benefits, they've seen the education system in this country erode. We need new leadership.

And then finally a president who says we can't win the war on terror and that he miscalculated the war in Iraq.

DOBBS: Well, in fairness to President Bush, Terry, as you well know, he recanted the next day and offered a...

MCAULIFFE: Sure, after they whispered in his ear, you're right.

DOBBS: ... a new statement.

MCAULIFFE: Yes.

DOBBS: In point of fact, tonight, we're going to hear from a longstanding Democrat, a man so popular with your party that in 12 years ago that he gave the keynote for President Bill Clinton, soon to be President Bill Clinton. What is your reaction? Zell Miller knows the same facts you do. He has chosen to support President Bush and maintains that steadfastly he is a Democrat till the day he dies.

MCAULIFFE: Well, let's be very clear. He is not a Democrat. He left our party a long time ago. I say he's the Darth Vader of the Democratic Party. He has never attended a Democratic Senate meeting since he has come up to Washington to be a senator. He has continually worked for Republicans. He's not done anything for the Democratic Party.

And the reason he won't shift and switch parties, which he ought to do -- he ought to do the right thing and go over there, because he supports them -- is, he's selling books. This is all about Zell Miller selling books. And if he were just another Republican with a book, he wouldn't sell any. But a Democrat out whacking Democrats helps him sell books.

This is a blatant materialism for him to sell more books. Nobody cares what Zigzag Zell Miller thinks.

DOBBS: Terry McAuliffe, thank you very much.

MCAULIFFE: Great, Lou, thanks.

DOBBS: Good to have you here.

We'll have much more, of course, on this campaign ahead.

But turning now to a developing story overseas, radical Islamist terrorists tonight are holding as many as 200 children hostage after an attack on a school in southern Russia. Nearly 200 adults are also being held hostage. The gunmen attacked the school on the first day of what is the new school year in Russia, killing at least four people.

This is the latest in the series of brash attacks by radical Islamists around the world this week.

Ryan Chilcote now with a report from Moscow. (BEGIN VIDEOTAPE)

RYAN CHILCOTE, CNN CORRESPONDENT (voice-over): These sounds of gunfire are coming from a school. Students, their parents and teachers, had just gathered for a ceremony to kick off the academic year. More than a dozen armed men and women stormed the school, some of them, Russian officials say, wearing suicide belts.

UNIDENTIFIED MALE (through translator): It began by shooting. We were standing by the gates. There was a song playing, and we stood there. Then I saw three people with automatic weapons running out. I at first thought it was a joke, but then they started shooting in the air. We ran away.

CHILCOTE: Russian officials don't know how many hostages are inside but believe the number is in the hundreds, many of them children between the ages of 7 and 17. A very small number of children managed to escape in the chaos.

UNIDENTIFIED MALE (through translator): We were standing there, and they began shooting. We thought it was one of the parents shooting. Then these guys ran out, these Chechens, surrounded us, and began shooting in the air. Then we started to run away. We saw two people. They didn't say anything. They just shouted at us. We didn't understand.

CHILCOTE (on camera): The hostage-takers are threatening to blow up the school if Russian forces try to storm it. They will also, they say, kill 50 kids for every hostage taker killed by Russian fire.

Russian authorities are in contact with the assailants. One of the hostage takers' demands, that Russia pull its troops out of the troubled Russian region of Chechnya.

(voice-over): Several people have already been killed, several more wounded. Relatives are being kept away.

(on camera): It is Russia's third terrorist attack in eight days, attacks that have now taken the lives of more than 100 people.

Ryan Chilcote, CNN, Moscow.

(END VIDEOTAPE)

DOBBS: Still ahead here tonight, Florida is now bracing for the second massive hurricane in less than a month, and Hurricane Frances could be far more destructive than Hurricane Charley. Max Mayfield is the director of the National Hurricane Center. He's our guest tonight and within the next 20 minutes will be updating us with the very latest.

Exporting America, the U.S. Chamber of Commerce says the shipment of American jobs to cheap foreign labor markets is good for this country. I'll be talking with the head of the chamber, Tom Donohue, about that and the American trial lawyers. Then, soaring energy prices squeezing this country's middle class. We'll have a special report for you on what the White House is doing to fight those rising prices.

All of that and a great deal more still ahead here tonight.

(COMMERCIAL BREAK)

DOBBS: A demonstration inside the Republican National Convention today. Police, in fact, arrested 11 protesters on the floor of Madison Square Garden. That, as White House chief of staff Andrew Card was speaking. Members of the AIDS activist group ACT UP blew whistles and chanted, "Bush Kills." One delegate was slightly injured after he was punched in the head during the melee. The Secret Service said the demonstrators had valid floor passes.

Thousands of other protesters, meanwhile, formed a symbolic unemployment line which stretched three miles, from Wall Street to Madison Square Garden, the group holding pink flyers aloft which read, "The Next Pink Slip Might Be Yours."

And tonight, union members from across the country are holding a rally, a labor rally, outside the Garden. That group said it is fighting against a number of issues, including soaring healthcare costs, the outsourcing of jobs. And right now, we're told the rally is breaking up. And those are live pictures in midtown Manhattan.

My guest tonight has said that outsourcing will actually boost the wealth and the living standards of Americans overall. The president and CEO of the U.S. Chamber of Commerce is Tom Donohue, and he joins us tonight.

Good to have you here, Tom.

TOM DONOHUE, PRESIDENT AND CEO, U.S. CHAMBER OF COMMERCE: Thank you very much. Good to be back.

DOBBS: But let's begin with, first, the chamber's involvement in this race. For the first time, you're taking an active role in a presidential election. Why?

DONOHUE: Well, we have said for a long period of time that if they were to take John Edwards and put him on this ticket that we would review our longstanding practice of not engaging in the presidential campaign.

DOBBS: And John Edwards, why?

DONOHUE: John Edwards is a trial lawyer who received the major portion of all his support to run for office and to run for president and run for vice president from the worst of the class-action lawyers. And we are asking people a simple question. If Edwards is in the second-most powerful seat in America, he will be involved in the appointment of 1,000 regulators, probably 25 or 30 appeals court justices, and the way we figure it, four Supreme Court justices.

Is that what we want in this country? I don't think so.

DOBBS: It's obviously what you and the chamber have decided you don't want, but is there anything in the ticket, the formation of the Democratic ticket, that could have persuaded you to have supported the Democratic ticket?

DONOHUE: We support a lot of Democrats in the House and the Senate. Some of our people were just down in Arkansas supporting Blanche Lincoln and others. We would have stayed out of the presidential activity had any other Democrat been appointed.

Now, let me make one point.

DOBBS: Sure.

DONOHUE: We are not endorsing Bush. We are not opposing Kerry. We are going to go into the battleground states in a number of ways and raise these issues about Edwards. And if it has a positive effect, fine.

DOBBS: But you've formed a 527 group, the November Fund, specifically for this purpose, right?

DONOHUE: Others formed the fund, which we're going to support. Literally, they called up, two of them called up...

DOBBS: Is -- you know, it's amazing to me, Tom...

DONOHUE: No, I would have formed it...

DOBBS: ... do you, do you, do you...

DONOHUE: ... I would have formed it...

DOBBS: ... find it amusing at all, whether it's Kerry or whether it's Bush, neither Republicans nor Democrats, your organization or any other, seems to have any direct connection ever to these...

DONOHUE: Absolutely, I have an absolute...

DOBBS: ... amorphous 527s.

DONOHUE: ... direct collection to them. We're going to support them in a vigorous way. And the people that are running them, we know very much.

DOBBS: OK.

DONOHUE: But we're -- Very well. We are going to do this by the law. We're not going to do how a lot of those Democratic funds have done, where they won't report their givers, say, they say, Find us, fine us, that whether they're a party to the campaign. We're not having any of that.

DOBBS: But President Bush really said, Let's back away from these 527s. Let's get out of that business altogether. The fact that you're going after Edwards because he is a longstanding member of the trial bar, it's a little difficult not to be against Senator Kerry, if you're against Senator Edwards, isn't it?

DONOHUE: Well, I want to reserve the right not to go into the next presidential election. And I think we have found a way to say we've spent $100 million on legal reform in the last three years and made great progress. And it's a runaway legal system in this country. You know it in your own business. You know it, it's helping drive jobs out of this country.

And we really thought it was absolutely essential to do this. And I think we found the right way to do it. And we're going to do it with honor and character.

DOBBS: Well, I applaud you and laud you for that.

You've also been supporting outsourcing by corporate America, which I cannot be quite so laudatory about.

DONOHUE: Well, I understand that.

DOBBS: The labor secretary today, as Terry McAuliffe, the chairman of the DNC, pointed out, saying outsourcing is good for America. At a time when this president is running the very real risk, as you know, of being the first president since Herbert Hoover -- and this is the mantra coming straight from the Democratic Party, they're using this fact daily, nearly. But the fact remains, he could be the first president since Herbert Hoover to have actually lost jobs, net jobs, in the course of his presidency his first term.

DONOHUE: Well, of course, we do know one fundamental number. And that is, there are more people working in the United States today than in any time in our history.

DOBBS: Yes, but...

DONOHUE: Wait, this...

DOBBS: ... but Tom, you're too bright, you have too much integrity. I like you too much for you to do that. The fact is, I said net loss. And that's what we live in this country. We have more people living here today than we ever have in our life.

DONOHUE: That's exactly right. And we have, and what we're doing in outsourcing, by the way, it's minuscule. We have outsourced 250,000 to 300,000 jobs in the last 18 to 20 months. Our insourcing -- now, we're not talking about manufacturing. Insourcing on the exact same type of business, we're talking clerical, financial, all of that, they're...

DOBBS: We're talking engineers.

DONOHUE: Yes, engineers...

DOBBS: We're talking programmers, we're... DONOHUE: ... we're talking that -- insource -- Exactly. Insourcing is $60 billion a year more in the United States than we outsource. Look, I'm sorry about those numbers, but that's what they are.

DOBBS: You ought to be sorry about the numbers, Tom, and you and I both know why. The fact is, you're talking about foreign direct investment in the world's richest consumer economy, and that is the price of doing business here.

DONOHUE: No, I'm not.

DOBBS: (UNINTELLIGIBLE)...

DONOHUE: I'm talking about outsourcing and insourcing.

DOBBS: All right. Let me ask you this.

DONOHUE: Shoot.

DOBBS: You want, you care about this economy, you care about ability of business people to do business.

DONOHUE: Absolutely.

DOBBS: Why is it such a stretch for you and the chamber, for this administration, for this Republican Party and much of the Democratic Party, to simply say you're going put as a priority the quality of life for middle class Americans and those who aspire to be part of it, and step back from this?

Because it is so clear. We have a $600 billion trade deficit. People in your organization tell us they want to compete. They're not doing a very good job. The president of the United States says we're going to drive economic growth. We're losing over a percentage point on GDP growth because of that deficit that's chronic. It's been here for 28 years.

DONOHUE: Well, there's no question...

DOBBS: Why not be straight about it?

DONOHUE: There's no question there's a deficit. I think you're very straight about it if you say that the great preponderance of the deficit came from homeland security, post-9/11, and from the Iraqi war. You can also look at the tax issue. And if you want to take the top end, where Kerry said that's the only place he's going put the tax back...

DOBBS: Right.

DONOHUE: ... that won't buy him lunch. He's got a plan that would require to take the whole tax deal away and do more.

DOBBS: I'm talking, I guess, perhaps too much in a nonpartisan, bipartisan fashion. DONOHUE: Well, I'll be (UNINTELLIGIBLE)...

DOBBS: The well-being of the middle class.

DONOHUE: I understand. And I think the middle class are the ones that even Kerry said he'd leave the tax cut with. The bottom line is, we're creating jobs. The biggest problem is that by 2010, we'll be 10 million people short to fill jobs in this country. That's the problem.

DOBBS: Tom Donohue, as always, it's good to have you here. It's certainly among the problems. We'll talk about the priority for them. And I hope you'll come back soon to do that.

DONOHUE: I will.

DOBBS: Tom Donohue.

DONOHUE: And I hope you come visit us soon.

DOBBS: You got a deal.

DONOHUE: Thank you.

DOBBS: Coming up next, this country tonight is bracing for yet another hurricane. And this is a big one, headed toward Florida. Gusts are now being measured up to 185 miles an hour. This is a category four hurricane right now, and it could be accelerating. We're going to learn a lot more about this hurricane and the threat that it poses from the head of the National Hurricane Center, Max Mayfield. He'll join us with the very latest on where the storm will hit and when.

It's one tax this administration just can't seem to cut, rising energy prices burdening the middle class. Our series of special reports on the middle class squeeze continues tonight.

We'll be going live to Madison Square Garden, the Republican National Convention. We'll hear from three of this country's top political journalists on this campaign. I'll also be joined by the chairman of the Senate Intelligence Committee, Senator Pat Roberts.

All of that, a great deal more. Those stories, your e-mails, stay with us.

(COMMERCIAL BREAK)

ANNOUNCER: LOU DOBBS TONIGHT continues with more news, debate, and opinion. Here now Lou Dobbs.

DOBBS: All this week, of course, we're reporting on President Bush's plans to fight what we call the middle-class squeeze on this broadcast. Tonight, we're focusing on the rising prices of energy, near record-high prices on oil and gasoline amounting to a tax on middle class families throughout the country, a tax this administration so far has been unable to cut. Peter Viles reports.

(BEGIN VIDEOTAPE)

PETER VILES, CNN FINANCIAL NEWS (voice-over): It was an administration priority before September 11, but despite terrorism, war in Iraq, summer blackouts, $40 oil, $2 a gallon gasoline, the Bush energy plan still languishes in the Senate.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: I submitted a plan to the United States Congress that encourages conservation, encourages research on alternative sources of energy, encourages the use of coal and environmentally friendly ways exploring for natural gas. But in all we do, we better make sure that we no longer have to beg for energy from other parts of the world. This country can do a better job.

VILES: Both candidates agree, America needs a broad energy policy that reduces reliance on oil from the Middle East. The biggest difference, the same one that divided candidates Bush and Gore four years ago, whether to open up a wildlife refuge in Alaska to oil drilling.

TIM ADAMS, BUSH-CHENEY POLICY DIRECTOR: Because it's the best source for domestic exploration, if we're going to move this country toward energy independence, we must promote domestic exploration of oil and natural gas, and work to produce close to a million barrels a day, which is roughly equivalent to what we're importing from Saudi Arabia.

VILES: The Bush plan would also streamline the permitting process for new refineries, encourage new nuclear power plants, and put in place new tax credits for buyers of hybrid and fuel-cell vehicles. Analysts caution, however, oil prices may not respond to any of this.

JAMES HAMILTON, UNIVERSITY OF CALIFORNIA, SAN DIEGO: Energy prices are determined on a world market, they're driven by world events. I think it's been news coming out of Iraq and Venezuela and Russia this year that's moved the oil market, demand coming from China. It's a misconception to think that's something that's controlled in the White House, whoever occupies it.

VILES: Critics say Congress has turned the Bush energy policy into a giveaway to the energy industry, $31 billion in tax breaks that would have little impact on prices paid by consumers.

(on camera): Now, one key pocketbook issue to keep an eye on here, mergers in the utility industry. The Bush administration policy would allow consolidation in that industry, and consumer groups say that would only mean higher utility rates for middle class Americans.

Peter Viles, CNN, Los Angeles.

(END VIDEOTAPE) DOBBS: Joining me now from the floor of Madison Square Garden, more on the Republican National Convention, three of the country's top political journalists, Karen Tumulty, "TIME" magazine, Roger Simon, "U.S. News and World Report," and E.J. Dionne, columnist for "The Washington Post."

Thanks for being here.

First the performances of -- let's turn to the performances of the first lady, the first daughters last night. Karen, what did they contribute?

KAREN TUMULTY, "TIME" MAGAZINE: What about those Bush twins, huh? Well, I think that -- words fail me on the Bush twins. I think "bizarre" might be the first one that comes to mind.

The first lady was her usual sort of calm, reassuring presence. I don't -- you know, she certainly didn't hit it out of the park. But she performed as she always does.

I was sort of surprised, though, that it wasn't more personal about the president. She said several times during the speech, I know him better than anyone else does. And I was sort of expecting some glimpses of him that we haven't seen before. And I didn't see those.

DOBBS: And I'll turn to you, Roger. The Terminator, how did he do?

ROGER SIMON, "U.S. NEWS AND WORLD REPORT": He did great. I just want to defend the Bush twins for a second, though.

DOBBS: Surely.

SIMON: I think (UNINTELLIGIBLE)...

DOBBS: Now, you notice, Ron Brownstein defended the president here, and a day later, is not, no longer with us, Roger.

SIMON: He's out of here, so I want to stay off that subject.

The media always say that these things are too scripted, they're inauthentic, they're too predictable. But yet, when we get a genuine moment from two genuine young women, like it or hate it, then we dump on them.

TUMULTY: Wait a minute, Roger...

SIMON: I assume, I assume...

TUMULTY: ... they were reading from a script.

SIMON: ... they were talking -- but it sounded like a script that could have been written by them, which is why people hated it. I assume that they were talking to their generation. It's not a generation sitting here today, and perhaps we didn't appreciate it. But I think they were supposed to be themselves, and they were. As to Arnold Schwarzenegger, I think it was one of the best speeches I have ever heard at a convention. I have been coming, I'm embarrassed to say, since 1976 to these things. It was very entertaining, and convention speeches are rarely entertaining on purpose. And it was also very tough. It was not compassionate conservatism, it was red meat.

I mean, Arnold Schwarzenegger attacked Hubert Humphrey by name. Hubert Humphrey has been dead for more than a quarter century. And he praised Richard Nixon. So it was yet another red-meat night from what's turning into a red-meat convention. But...

DOBBS: Your thoughts, E.J.?

E.J. DIONNE, "THE WASHINGTON POST": Well, first of all, it is probably the first time in 30 years that a speaker from the podium said so many nice things about Richard Nixon. But I was struck, it was -- there are certain moments that were mean that were kind of hidden by the humor, calling all people who say the economy could be better "girly men" was probably the most extraordinary moment we've seen in the convention so far.

But on the -- on Mrs. Bush's speech, I think that was one of the best political documents that I have seen in a long time, because that speech was very carefully written, almost as a lawyer's brief, to answer the doubts of swing voters, particularly undecided women.

A lot of people say the president is reckless, he makes decisions just off the top of his head. She went out of her way to talk about how deliberate he was and how worried that he was, that the president really kind of likes to go to war a lot of people out there think. No, no, said Mrs. Bush. Nobody likes to go to war and certainly not my husband. I think that that was in some ways the most effective political speech we've seen at the convention.

DOBBS: Yes, I found it interesting. The first lady, I thought, was gracious. I thought she was not trying to put on a performance. And in that I thought was terrific in her performance. All that is happening within that convention, Zell Miller tonight, who will become the first man to ever deliver a keynote speech to both the Democrats and Republican conventions. What can we expect? How effective will it be, Karen?

KAREN TUMULTY, CNN NATIONAL POLITICAL CORRESPONDENT: Well, I think that Zell Miller is a very, at least in my experience in Washington, can be a very effective speaker. And this audience is absolutely going to love him. But the fact is that practically since the first week of the Bush administration when he was, I believe, the first Senate Republican to embrace the Bush tax -- I mean, the first Senate Democrat to embrace the Bush tax cuts, he's been really a Democrat in name only. But I think that he's likely to have much the same effect on this audience that, say, Ron Reagan did at the Democratic convention.

DOBBS: Karen, thank you, Roger Simon, E.J. Deion, we're going to have to break away. We thank you always for your insights, and we'll return to you as quickly as we can. Thank you, folks.

UNIDENTIFIED MALE: Thank you.

DOBBS: That brings to us the subject of our poll tonight, have the Democratic and Republican conventions influenced your vote, yes or no. Cast your vote at cnn.com/lou. We'll have the results coming up later in the broadcast.

And tonight's thought is on elections. When the shadow of the presidential and congressional election is lifted, we shall, I hope, be in a better temper to legislate. Those are the words of the 20th president of the United States, James Garfield.

Turning now to a rapidly developing story about the massive hurricane, in fact, a category four hurricane, that is approaching the Bahamas barreling toward the east coast of Florida, Governor Jeb Bush has declared Florida to be in a state of emergency. Hurricane Frances is currently a category four storm. It has sustained winds of 140 miles an hour, wind gusts rising as high as 185 miles an hour. Now, for the very latest on the storm I'm joined by Max Mayfield, the director of the National Hurricane Center in Miami. Max, first, thanks for taking time in what I know is a very busy period for you. What the latest developments?

MAX MAYFIELD, DIRECTOR, NATIONAL HURRICANE CENTER: Well, Lou, you said it's a very powerful and a very dangerous category four hurricane on our Sanford/Simpson (ph) hurricane scale. It's still, you know, a couple days away. We don't want to focus on that landfall point. Let's not make the same mistake that some people did with Charley. This is a much larger hurricane than Hurricane Charley, so wherever it hits, it will have a big impact of a large area.

DOBBS: There's another mistake I think that you would agree is not being made, Governor Bush already declaring a state of emergency. As I go through this list. Palm Beach County has issued a mandatory evacuation order for 300,000 residents there living across the coast. Brevard County urging 185,000 of its residents to evacuate by tomorrow. Indian River County, shelters already being set up. The right response?

MAYFIELD: Oh, absolutely. We've been talking with the state and local emergency managers actually all week long here in Florida. They've got some of the best people anywhere in the coastline and the inland counties as well. What we don't want to do though is have that shadow evacuation. You don't want people to evacuate unless they're told to do so by their local officials.. You know, if you live in a well constructed house outside of the storm surge evacuation zone and not in a mobile home, don't add to the traffic congestion by getting on to the roads and leaving.

DOBBS: And, Max, with the storm behind you there, what is your sense of it? I know this is difficult, but what is your sense of the strength of this hurricane? I know it's likely to weaken with landfall, but this seems somewhat more powerful than most storms.

MAYFIELD: Yes, yes. It certainly is. We don't have very many. We've had, I believe, 14 category four hurricanes, three category five hurricanes in the last 10 and some odd years. So we don't really see anything to make us think that this will weaken significantly. People need to be preparing as if they're going get hit by a major hurricane. We likely will see some fluctuations. It may weaken a little bit. But we really think it'll regain that strength. And right now, it's a very solid category four hurricane.

DOBBS: Max Mayfield, the director of the Hurricane National Center, as always we depend upon you for your insight and judgment on these things. We thank you for taking the time.

MAYFIELD: Thank you, sir.

DOBBS: Taking a look at some of your thoughts on our reporting on this broadcast. On "Broken Borders" specifically tonight, Patricia from Florida. "How can our government even suggest giving Social Security benefits to illegal aliens? It seems that everything I've ever worked hard for or dreamed of owning is now just handed over to illegal immigrants who possess no loyalty to this country."

Bob in Ohio. "Lou, explain to me why Greenspan says we might have to cut Social Security benefits and at the same time they are talking about giving illegal immigrants benefits."

Ilayudine (ph) from Arizona. "My parents escaped Hitler and Stalin and came here legally after waiting years and years to be admitted. Back then, they had to be healthy, to speak English and know the Constitution, among other things. Please, please, please know how many millions and millions of American citizens are desperate to have something done about this issue."

And Dale in Nevada. "Since NAFTA is so valuable to Mexico, why not make Mexico's continued participation in NAFTA contingent upon Mexico's genuine and effective effort to curb illegal immigration."

We love to hear from you. We love to share your thoughts. Send us your thoughts at loudobbs@cnn.com. And please send us your name and address. We are sending each of you whose e-mail is read on this broadcast a copy of my new book "Exporting America."

Coming up next, can we win the war on terror? Conflicting messages this week from the president. Senator Pat Roberts, chairman of the Senate Intelligence Committee. He joins me next from the Republican National Convention.

And exporting America, Senator John Kerry says he has a plan to help stem the flow of American jobs to cheap foreign markets. Roger Altman, senior economic adviser to the Kerry campaign, will be with us. Please stay with us.

(COMMERCIAL BREAK)

DOBBS: President Bush this week raised the possibility that the war on terror may be unwinnable. The president later made clear he believes the United States will win. But the president's remarks opened a debate about what constitutes victory in the global war against radical Islamist terrorism. I'm joined now by the highly respected chairman of the Senate Intelligence Committee, Senator Pat Roberts. Senator Roberts joins us tonight from the Republican National Convention in Madison Square Garden. Senator, good to have you with us.

SENATOR PAT ROBERTS, CHAIRMAN, SENATE INTELLIGENCE COMMITTEE: Lou, thank you. And you should be here. There's a chant behind me. They're asking for your name. Lou, Lou, Lou. They're chanting. They want you.

DOBBS: I'm sure they do, particularly the White House. And we won't specify why they would want me. Senator, we would like to address a number of issues. There's so many things going on this evening, but let me begin first, hundreds of people being held hostage in southern Russia tonight by radical Islamist terrorists, hundreds of them children. We have seen the violence that has erupted after a period of respite in Israel. Israel blaming Syria now for the actions of Hamas. Iraq radical Islamist terrorism goes on there. What is the United States, what is the civilized world to do?

ROBERTS: Basically you have to be resolute. You have to understand this is an international war against terrorism. This isn't anything new for Russia. There's a fellow called Besiov (ph). I think I have pronounced that right. He's the fellow that was behind that attack where they held the hostages in the theater. Now they've got a school, two airplanes, bus. Putin has said this is a war. Putin even suspects after he met with Chirac and Schroeder that basically there may be a tie to Al Qaida. One of the good things that's happening, and there isn't much good about this, is that NATO is now considering this. I hope this wakes up Europe to the fact that they will be able to contribute more to NATO. This is the kind of thing that NATO can step up. We're doing everything we can with the Russians, in terms of sharing our intelligence information to be of help.

DOBBS: Senator, the fact that Israel has singled out Syria, expecting retaliation, will that be in point of fact in the interest of the United States as we pursue this global war on terror? Is it simply absolutely necessary for Israel to conduct its policy in that way?

ROBERTS: Well, you can't dictate what another nation will do in terms of its sovereign or national interest. But we had a six months time period where we didn't have these attacks, and we thought we were making progress. Then you have, what is it, 16 people killed, horrible picture on the front of the "New York Times." Just a dreadful occurrence. And the Israelis truly believe that that came from Hamas and also from Syria. So they are threatening an attack at the source. Now, obviously, if their intelligence sources are accurate, that is a response they may well take. They have in the past. That is a situation that is ongoing just as well, just as the situation in regards to Iran. Now they are enriching their uranium, according to the IAEA, with enough of that to, what, I think five nuclear devices.

DOBBS: Right. Correct. ROBERTS: And then you have the situation in regards to the Sudan. The U.N. has to step up, can't just pass resolutions. Kofi Annan says we need 3,000 peacekeepers. I haven't seen too many people raise their hands. We, and I'm talking about the United States, have asked the African security council to send in 2,000 peacekeepers. Until we do something like that resolute in regards to the U.N., I'm afraid we're in for a tough time in regards to those poor folks in Sudan.

DOBBS: What was your reaction, Senator, when you heard President Bush say the war against terror is unwinnable?

ROBERTS: Well, you know, I heard a lot about that. And, of course, my friends across the aisle have made a big thing about that. I think he's talking about the fact that you're not standing on the USS Missouri with McArthur and saying OK, there is now peace and here's the treaty and you sign it and here's the understanding and here's the occupying force, and then we're going to have peace on down the road. That's not the case with this war. This war is a very nebulus war of attrition, by various terrorist groups. I think that is what he was referring to in terms of, quote, "winning the war against terrorism." I certainly think that he said, as of today, certainly, we will try to win it in terms of making America safer and the world safer.

DOBBS: Making America safer, restructuring the CIA and creating the national intelligence director, your proposals. Acting director of the CIA, John McLaughlin described your plan to divide the CIA as a step backward. Will you be talking with the acting director soon?

ROBERTS: I have contacted all 15 heads of the intelligence agencies in terms of personal conversation. I have tried to point out to people we are not trying to dismantle the CIA by any means. We have many fine people working for the CIA doing an outstanding job, laying their lives down for this country. But every time they come before the intelligence committee, Lou, they say we need more authority, certain priority funding. They've had the authority since 1947. We have tried 38 times to reform the intelligence community. Now that we have real reform and we step back from the trees and said, all right, we're not going to consider turf or committees or agencies, what would you do to have a national intelligence service. We're going to have a national intelligence director. We're going to enhance the CIA's position in regards to collection and also analyzing. They'll do a better job.

DOBBS: Senator Pat Roberts, we thank you very much for being with us here, as always.

ROBERTS: Lou, thank you so much.

DOBBS: Still ahead here, exporting America, Senator John Kerry says American companies must be more competitive to keep American jobs in this country. Is Senator Kerry backing away from his opposition to exporting? We'll find out. I'll be talking with Senator Kerry's senior economic adviser, Roger Altman. He's next. Stay with us.

(COMMERCIAL BREAK)

DOBBS: Well, Senator Kerry says that he will fight the shipment of American jobs to cheap overseas labor markets. He says lower health care and energy costs, corporate tax credits, all of those issues are definitive with the campaign. I am joined now by one of the campaign's senior economic advisers, in fact, an old friend, Roger Altman. Good to have you here.

ROGER ALTMAN, KERRY CAMPAIGN SENIOR ECONOMIC ADVISER: Thanks for having me, Lou.

DOBBS: Roger, let's be clear about this thing on outsourcing. You've heard the head of the chamber of commerce, we've heard the Bush administration say it's absolutely necessary that jobs be outsourced to cheap labor markets to keep this economy vigorous. Meanwhile, we're not creating jobs in this country at a rate to keep up with the rate of the growth of the labor force. What's the senator's position? For it, against it?

ALTMAN: Well, first of all, the difference between the two candidates on this issue, outsourcing, is the difference between night and day. One candidate says, it's good for the country, let's have more of it. Another candidate says, we need to do something about this, we need to strengthen the competitiveness of our employees. We need to lower the cost of doing business for our employers to help us keep more jobs here and create more jobs here. Big, big difference.

DOBBS: It's a big difference, but perhaps it's not one that is distinct, at least for me, if I may say. The fact is that this Democratic candidate for president said that the CEOs who send these jobs to cheap labor markets kill an American job to create one in a cheap foreign labor market are Benedict Arnold CEOs. We haven't heard him say that recently. We haven't heard a real specific plan to say to corporate America, you're not going to run this country. The country is going be run by the people. The Democratic party is the party traditionally for working men and women in this country, yet we see corporate interests with significant influence in both campaigns.

ALTMAN: Well, I think Senator Kerry is saying this. Let me try to be as clear as I can.

DOBBS: Surely.

ALTMAN: First, we can't build walls around the country. We can't ban outsourcing. What we can do is strengthen the employment base in this country and make our country more competitive and get back our fighting edge, get back our competitive edge. That's why he has said I want to lower the cost of doing business for American employers. I have got a plan to get health care costs down.

The rate of inflation in health care costs three to four times the rate of inflation in the rest of our economy. We've got to get energy costs down. We all know they're way out of control and hurting business badly. He's going to cut corporate tax rates, and he's going to say for any new job created in manufacturing and other categories vulnerable to outsourcing over the next two years, the employer will be relieved of the payroll tax cost of that new job, payroll tax holiday.

Those four points as a pro-competitiveness, pro-employer program for this country. Mr. Bush is saying, let's - you know, he's saying, in effect, let's get it on with more outsourcing. And I don't know how you could have a starker difference. If the question is Senator Kerry want to ban outsourcing, pass a law to prevent it? No, he doesn't because he knows we are in an integrated global economy and some of it is going to occur and some of it in the long run is healthy. But a lot of it does not have to occur. And that's the difference.

DOBBS: Well, then, let's ask the question. How much of it is necessary and by whose judgment is it?

ALTMAN: Well, Lou, I can't give you a number, but what I can say is...

DOBBS: OK. The reason I ask that is that the ambiguity has got to be alarming to millions of folks in this country who work for a living. They're faced with rising energy prices, as you say. They are faced with all sorts of burdens, rising education, as well as health care costs. The need to drive job creation in this country and yet free trade was an invention at least through NAFTA of the Democratic party, a Democratic president who you were serving. In point of fact, we have seen NAFTA does not work as it's currently constructed. The WTO is certainly challengeable in a host of areas. But a chronic trade deficit, where does he differ with the president on those issues?

ALTMAN: Well, first of all, we have to get our own economy to perform better. Part of the reason we have such a large trade deficit is that our own economy is not performing at an optimal level. I mean, I think you know the numbers. The Bush economic record, which parenthetically we haven't heard a word about the first two nights of this convention. Ask yourself why that is. Nevertheless it's the slowest...

DOBBS: This audience doesn't need to pose rhetorical questions.

ALTMAN: It's the slowest growth rate in a recovery in 70 years. Forget the tech bubble, the corporate scandals, 9-11, what they talk about. Measure it from the beginning of the recovery. Slowest growth rate in 70 years, worst job record in 70 years. Family incomes the acid test, the acid test, down under President Bush, down a lot. Every one of the eight Clinton years they were up.

DOBBS: Roger Altman, as always, good to talk with you.

ALTMAN: Thanks for having me.

DOBBS: A reminder now to vote in our poll. The question is have the Democratic and Republican conventions - although this one is not quite concluded - influenced how you will vote come November. Please vote yes or no. Cast your vote at cnn.com/lou. Results are coming up just in a moment. Also ahead we'll have your thoughts on the outrageous report showing how much corporate CEOs are profiting from the shipment of American jobs overseas. Stay with us.

(COMMERCIAL BREAK)

DOBBS: Taking a look now at more of your thoughts, many of you writing in about our report last night on CEOs making millions of dollars more when American jobs are shipped overseas, at the conclusion of a recent report.

Patrick in Dallas, Georgia. "Lou, I feel so much better about outsourcing our jobs now. CEOs who outsource get more money and we get to watch a movie on it. Wow, what a deal."

A reference, by the way, to the movie coming out "Outsourced."

Scott Awalls (ph) of Arvida (ph), Colorado. "These CEOs care only about their own wallets. How can the American people continue to afford products made in this country when they can't find a job that pays them enough to live on."

In our series of special reports on the middle class squeeze, Christopher Durby (ph) in Brainerd, Minnesota. "Thanks, Lou, for making the point that the middle class is under attack through the exporting of our jobs. I wish our elected officials defended our jobs as much as you do."

We thank you for being with us and we love hearing from you. Send us your e-mails at CNN.com/lou. Please include your full name and address. if your e-mail is read here, we send you a copy of my new book "Exporting America."

And still ahead here, the results of tonight's poll. And we'll have a preview of what's going to be here tomorrow. Stay with us.

(COMMERCIAL BREAK)

DOBBS: The results of our poll tonight. Ninety-three percent of you say that neither the Democratic nor Republican convention has influenced the way you're going to vote in November. And the second most powerful Republican in the U.S. Senate will be joining us here tomorrow. We hope you will as well. That's it from New York for tonight. I'm Lou Dobbs. Thanks for being with us. Good night from New York City. "ANDERSON COOPER 360" coming right up.

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


Aired September 1, 2004 - 18:00   ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
ANNOUNCER: this is LOU DOBBS TONIGHT for Wednesday, September 1. Here now for an hour of news, debate, and opinion is Lou Dobbs.
LOU DOBBS, HOST: Good evening.

Tonight, we're following a number of rapidly developing stories.

Delegates at the Republican National Convention tonight are expecting an all-out assault on the Democrats from Vice President Dick Cheney and Democratic Senator Zell Miller. We'll have that story for you.

And a category four hurricane is now approaching the Bahamas. It's barreling towards the east coast of Florida, with wind gusts of up to 185 miles an hour, sustained winds of 140 miles an hour. We'll have the latest update for you from the National Hurricane Center. The director of the center, Max Mayfield, will be with us.

And radical Islamist terrorists tonight holding hundreds of children and adults hostage in southern Russia. We'll have a report for you on that as well.

We begin tonight, though, with the Republican National Convention, where Vice President Dick Cheney will blast the Democrats and Senator Kerry in a primetime speech. Vice President Cheney is expected to say that this election comes at a defining moment in our country's history. Another primetime speaker is longtime Senator Zell Miller of Georgia. Senator Miller will tell this convention why he switched his loyalties to President Bush.

White House correspondent Dana Bash is with the Georgia delegation on the floor of Madison Square Garden, joining us now with the story. Dana?

DANA BASH, CNN WHITE HOUSE CORRESPONDENT: Well, Lou, again tonight we are going hear some high-profile testimony about why it's important, they think here, for George W. Bush to be commander in chief for another four years.

Vice President Cheney, of course will be the lead speaker on that issue. He is going to say, as you mentioned, that it is a defining moment in history, and that is why he thinks that George W. Bush is the man to lead. He also will say it's very much like it was after World War II, and that this is something that Americans must keep in mind, that he is the leader, not the Democrat on the other side.

He'll also go through what he calls a record of achievement in the Bush administration, domestic issues like education and tax cuts, also national security, a record he will say, is in sharp contrast to that of Democratic John Kerry. He'll say, quote, "And on the question of America's role in the world, the differences between Senator Kerry and President Bush are the sharpest, and the stakes for the country are the highest."

Now, aides say about 20 percent of the vice president's speech will be aimed at denouncing John Kerry and his candidacy. That is tradition for vice presidents. They generally give the sharpest attacks.

What is not tradition is to get an attack from somebody on the same side of the opponent. That is what we're going to get tonight here at the Republican convention, a Democrat, Zell Miller. He will be talking tonight about why he's crossing party lines to support George W. Bush for president.

He stood here in Madison Square Garden 12 years ago as a keynote speaker in the nominating convention of President Bill Clinton, at the time Candidate Bill Clinton. There he slammed the first President Bush, saying that he simply didn't get it on big issues like the economy.

Now he says the son needs another four years as president, not his fellow Democratic senator, John Kerry. Says he's not up to the job, saying, quote, "Right now, the world just cannot afford an indecisive America. Fainthearted self-indulgence will put at risk all we care about in this world. In this hour of danger, our president has had the courage to stand up, and this Democrat is proud to stand up for him."

Now, Democrats are infuriated by this, of course, as you can imagine. Nationally in his home state, they're actually running an ad with some of his speech from 1992 slamming first President George W. Bush. Republicans here at the convention, though, even though who've spent decades running against Zell Miller, as you can imagine, Lou, are quite happy to have him here.

DOBBS: We'll be looking forward to it. Thank you very much, Dana Bash from the floor of Madison Square Garden.

President Bush will arrive in New York City tonight to attend his convention, but first, he made one more campaign visit, this one to Ohio, of course, a key battleground state, the president's final stop on a nine-state journey to the convention. Tonight the president will meet with New York firefighters in the borough of Queens. The president will then speak to the convention tomorrow evening.

Senator John Kerry today struck back at his Republican critics. Senator Kerry said extremism has gained momentum in Iraq because of the Bush administration's policies. Senator Kerry also said the war on terror can be won, but only with the right policies. This presidential election is now only two months away. Some Democrats are expressing concern that Senator Kerry may be losing ground to President Bush. Some Democrats, in fact, are calling for changes in Senator Kerry's campaign staff.

Joining me now is the Democratic National Committee chairman, Terry McAuliffe.

Terry, good to have you with us.

TERRY MCAULIFFE, CHAIRMAN, DEMOCRATIC NATIONAL COMMITTEE: Good to be with you, Lou.

DOBBS: The -- let's start with the calls now for changes in the Kerry campaign. There have been missteps, as there are with any presidential campaign, but a lot of top Democrats are now talking privately and some publicly about changes. What do you think?

MCAULIFFE: Well, the campaign has clearly said there will not be any changes. There will be additions. I mean, we are now about 60 days away from the election We're headed into the fall campaign. I mean, many of the political operatives who had other jobs and other family considerations are now saying it's time to come into the campaign.

So you'll see a big expansion of getting people into the campaign to help us do the final 60 days. This election is so tight. It's going to, you know, be tight right up to the end, Lou. But we got to get all hands on deck.

John Kerry has told me from day one, Terry, all hands on deck. Everybody in this campaign, let's go. And that's what we're going to do.

DOBBS: Everyone is going. I, the Republicans with whom I speak, the Democrats with whom I speak, all acknowledge that there's about a 2 percentage point variance here in the vote. How in the world is Senator Kerry, challenging an incumbent president, going to capitalize and drive forward his message in presumably in an effort to win in November?

MCAULIFFE: Well, John Kerry's whole campaign is built upon, you know, creating 10 million new jobs his first term in office, tax cut for 99 percent of the taxpayers. I mean, when you have George Bush out there with the record he has to defend, he consistently is under 50 percent. Only 40 percent of Americans, Lou, think the country is headed in the right direction.

And today, the secretary of labor coming out and saying it's a great thing we outsource our jobs. I mean, go to Canton, Ohio, where the Timkin (ph) plant was just shut down. You tell those workers that it's a good thing to ship their jobs overseas. Or Fort Smith, Arkansas, the Whirlpool plant, all the layoffs there.

We need a president who's focused on all Americans out there. Many Americans have lost their job, they've lost their health and benefits, they've seen the education system in this country erode. We need new leadership.

And then finally a president who says we can't win the war on terror and that he miscalculated the war in Iraq.

DOBBS: Well, in fairness to President Bush, Terry, as you well know, he recanted the next day and offered a...

MCAULIFFE: Sure, after they whispered in his ear, you're right.

DOBBS: ... a new statement.

MCAULIFFE: Yes.

DOBBS: In point of fact, tonight, we're going to hear from a longstanding Democrat, a man so popular with your party that in 12 years ago that he gave the keynote for President Bill Clinton, soon to be President Bill Clinton. What is your reaction? Zell Miller knows the same facts you do. He has chosen to support President Bush and maintains that steadfastly he is a Democrat till the day he dies.

MCAULIFFE: Well, let's be very clear. He is not a Democrat. He left our party a long time ago. I say he's the Darth Vader of the Democratic Party. He has never attended a Democratic Senate meeting since he has come up to Washington to be a senator. He has continually worked for Republicans. He's not done anything for the Democratic Party.

And the reason he won't shift and switch parties, which he ought to do -- he ought to do the right thing and go over there, because he supports them -- is, he's selling books. This is all about Zell Miller selling books. And if he were just another Republican with a book, he wouldn't sell any. But a Democrat out whacking Democrats helps him sell books.

This is a blatant materialism for him to sell more books. Nobody cares what Zigzag Zell Miller thinks.

DOBBS: Terry McAuliffe, thank you very much.

MCAULIFFE: Great, Lou, thanks.

DOBBS: Good to have you here.

We'll have much more, of course, on this campaign ahead.

But turning now to a developing story overseas, radical Islamist terrorists tonight are holding as many as 200 children hostage after an attack on a school in southern Russia. Nearly 200 adults are also being held hostage. The gunmen attacked the school on the first day of what is the new school year in Russia, killing at least four people.

This is the latest in the series of brash attacks by radical Islamists around the world this week.

Ryan Chilcote now with a report from Moscow. (BEGIN VIDEOTAPE)

RYAN CHILCOTE, CNN CORRESPONDENT (voice-over): These sounds of gunfire are coming from a school. Students, their parents and teachers, had just gathered for a ceremony to kick off the academic year. More than a dozen armed men and women stormed the school, some of them, Russian officials say, wearing suicide belts.

UNIDENTIFIED MALE (through translator): It began by shooting. We were standing by the gates. There was a song playing, and we stood there. Then I saw three people with automatic weapons running out. I at first thought it was a joke, but then they started shooting in the air. We ran away.

CHILCOTE: Russian officials don't know how many hostages are inside but believe the number is in the hundreds, many of them children between the ages of 7 and 17. A very small number of children managed to escape in the chaos.

UNIDENTIFIED MALE (through translator): We were standing there, and they began shooting. We thought it was one of the parents shooting. Then these guys ran out, these Chechens, surrounded us, and began shooting in the air. Then we started to run away. We saw two people. They didn't say anything. They just shouted at us. We didn't understand.

CHILCOTE (on camera): The hostage-takers are threatening to blow up the school if Russian forces try to storm it. They will also, they say, kill 50 kids for every hostage taker killed by Russian fire.

Russian authorities are in contact with the assailants. One of the hostage takers' demands, that Russia pull its troops out of the troubled Russian region of Chechnya.

(voice-over): Several people have already been killed, several more wounded. Relatives are being kept away.

(on camera): It is Russia's third terrorist attack in eight days, attacks that have now taken the lives of more than 100 people.

Ryan Chilcote, CNN, Moscow.

(END VIDEOTAPE)

DOBBS: Still ahead here tonight, Florida is now bracing for the second massive hurricane in less than a month, and Hurricane Frances could be far more destructive than Hurricane Charley. Max Mayfield is the director of the National Hurricane Center. He's our guest tonight and within the next 20 minutes will be updating us with the very latest.

Exporting America, the U.S. Chamber of Commerce says the shipment of American jobs to cheap foreign labor markets is good for this country. I'll be talking with the head of the chamber, Tom Donohue, about that and the American trial lawyers. Then, soaring energy prices squeezing this country's middle class. We'll have a special report for you on what the White House is doing to fight those rising prices.

All of that and a great deal more still ahead here tonight.

(COMMERCIAL BREAK)

DOBBS: A demonstration inside the Republican National Convention today. Police, in fact, arrested 11 protesters on the floor of Madison Square Garden. That, as White House chief of staff Andrew Card was speaking. Members of the AIDS activist group ACT UP blew whistles and chanted, "Bush Kills." One delegate was slightly injured after he was punched in the head during the melee. The Secret Service said the demonstrators had valid floor passes.

Thousands of other protesters, meanwhile, formed a symbolic unemployment line which stretched three miles, from Wall Street to Madison Square Garden, the group holding pink flyers aloft which read, "The Next Pink Slip Might Be Yours."

And tonight, union members from across the country are holding a rally, a labor rally, outside the Garden. That group said it is fighting against a number of issues, including soaring healthcare costs, the outsourcing of jobs. And right now, we're told the rally is breaking up. And those are live pictures in midtown Manhattan.

My guest tonight has said that outsourcing will actually boost the wealth and the living standards of Americans overall. The president and CEO of the U.S. Chamber of Commerce is Tom Donohue, and he joins us tonight.

Good to have you here, Tom.

TOM DONOHUE, PRESIDENT AND CEO, U.S. CHAMBER OF COMMERCE: Thank you very much. Good to be back.

DOBBS: But let's begin with, first, the chamber's involvement in this race. For the first time, you're taking an active role in a presidential election. Why?

DONOHUE: Well, we have said for a long period of time that if they were to take John Edwards and put him on this ticket that we would review our longstanding practice of not engaging in the presidential campaign.

DOBBS: And John Edwards, why?

DONOHUE: John Edwards is a trial lawyer who received the major portion of all his support to run for office and to run for president and run for vice president from the worst of the class-action lawyers. And we are asking people a simple question. If Edwards is in the second-most powerful seat in America, he will be involved in the appointment of 1,000 regulators, probably 25 or 30 appeals court justices, and the way we figure it, four Supreme Court justices.

Is that what we want in this country? I don't think so.

DOBBS: It's obviously what you and the chamber have decided you don't want, but is there anything in the ticket, the formation of the Democratic ticket, that could have persuaded you to have supported the Democratic ticket?

DONOHUE: We support a lot of Democrats in the House and the Senate. Some of our people were just down in Arkansas supporting Blanche Lincoln and others. We would have stayed out of the presidential activity had any other Democrat been appointed.

Now, let me make one point.

DOBBS: Sure.

DONOHUE: We are not endorsing Bush. We are not opposing Kerry. We are going to go into the battleground states in a number of ways and raise these issues about Edwards. And if it has a positive effect, fine.

DOBBS: But you've formed a 527 group, the November Fund, specifically for this purpose, right?

DONOHUE: Others formed the fund, which we're going to support. Literally, they called up, two of them called up...

DOBBS: Is -- you know, it's amazing to me, Tom...

DONOHUE: No, I would have formed it...

DOBBS: ... do you, do you, do you...

DONOHUE: ... I would have formed it...

DOBBS: ... find it amusing at all, whether it's Kerry or whether it's Bush, neither Republicans nor Democrats, your organization or any other, seems to have any direct connection ever to these...

DONOHUE: Absolutely, I have an absolute...

DOBBS: ... amorphous 527s.

DONOHUE: ... direct collection to them. We're going to support them in a vigorous way. And the people that are running them, we know very much.

DOBBS: OK.

DONOHUE: But we're -- Very well. We are going to do this by the law. We're not going to do how a lot of those Democratic funds have done, where they won't report their givers, say, they say, Find us, fine us, that whether they're a party to the campaign. We're not having any of that.

DOBBS: But President Bush really said, Let's back away from these 527s. Let's get out of that business altogether. The fact that you're going after Edwards because he is a longstanding member of the trial bar, it's a little difficult not to be against Senator Kerry, if you're against Senator Edwards, isn't it?

DONOHUE: Well, I want to reserve the right not to go into the next presidential election. And I think we have found a way to say we've spent $100 million on legal reform in the last three years and made great progress. And it's a runaway legal system in this country. You know it in your own business. You know it, it's helping drive jobs out of this country.

And we really thought it was absolutely essential to do this. And I think we found the right way to do it. And we're going to do it with honor and character.

DOBBS: Well, I applaud you and laud you for that.

You've also been supporting outsourcing by corporate America, which I cannot be quite so laudatory about.

DONOHUE: Well, I understand that.

DOBBS: The labor secretary today, as Terry McAuliffe, the chairman of the DNC, pointed out, saying outsourcing is good for America. At a time when this president is running the very real risk, as you know, of being the first president since Herbert Hoover -- and this is the mantra coming straight from the Democratic Party, they're using this fact daily, nearly. But the fact remains, he could be the first president since Herbert Hoover to have actually lost jobs, net jobs, in the course of his presidency his first term.

DONOHUE: Well, of course, we do know one fundamental number. And that is, there are more people working in the United States today than in any time in our history.

DOBBS: Yes, but...

DONOHUE: Wait, this...

DOBBS: ... but Tom, you're too bright, you have too much integrity. I like you too much for you to do that. The fact is, I said net loss. And that's what we live in this country. We have more people living here today than we ever have in our life.

DONOHUE: That's exactly right. And we have, and what we're doing in outsourcing, by the way, it's minuscule. We have outsourced 250,000 to 300,000 jobs in the last 18 to 20 months. Our insourcing -- now, we're not talking about manufacturing. Insourcing on the exact same type of business, we're talking clerical, financial, all of that, they're...

DOBBS: We're talking engineers.

DONOHUE: Yes, engineers...

DOBBS: We're talking programmers, we're... DONOHUE: ... we're talking that -- insource -- Exactly. Insourcing is $60 billion a year more in the United States than we outsource. Look, I'm sorry about those numbers, but that's what they are.

DOBBS: You ought to be sorry about the numbers, Tom, and you and I both know why. The fact is, you're talking about foreign direct investment in the world's richest consumer economy, and that is the price of doing business here.

DONOHUE: No, I'm not.

DOBBS: (UNINTELLIGIBLE)...

DONOHUE: I'm talking about outsourcing and insourcing.

DOBBS: All right. Let me ask you this.

DONOHUE: Shoot.

DOBBS: You want, you care about this economy, you care about ability of business people to do business.

DONOHUE: Absolutely.

DOBBS: Why is it such a stretch for you and the chamber, for this administration, for this Republican Party and much of the Democratic Party, to simply say you're going put as a priority the quality of life for middle class Americans and those who aspire to be part of it, and step back from this?

Because it is so clear. We have a $600 billion trade deficit. People in your organization tell us they want to compete. They're not doing a very good job. The president of the United States says we're going to drive economic growth. We're losing over a percentage point on GDP growth because of that deficit that's chronic. It's been here for 28 years.

DONOHUE: Well, there's no question...

DOBBS: Why not be straight about it?

DONOHUE: There's no question there's a deficit. I think you're very straight about it if you say that the great preponderance of the deficit came from homeland security, post-9/11, and from the Iraqi war. You can also look at the tax issue. And if you want to take the top end, where Kerry said that's the only place he's going put the tax back...

DOBBS: Right.

DONOHUE: ... that won't buy him lunch. He's got a plan that would require to take the whole tax deal away and do more.

DOBBS: I'm talking, I guess, perhaps too much in a nonpartisan, bipartisan fashion. DONOHUE: Well, I'll be (UNINTELLIGIBLE)...

DOBBS: The well-being of the middle class.

DONOHUE: I understand. And I think the middle class are the ones that even Kerry said he'd leave the tax cut with. The bottom line is, we're creating jobs. The biggest problem is that by 2010, we'll be 10 million people short to fill jobs in this country. That's the problem.

DOBBS: Tom Donohue, as always, it's good to have you here. It's certainly among the problems. We'll talk about the priority for them. And I hope you'll come back soon to do that.

DONOHUE: I will.

DOBBS: Tom Donohue.

DONOHUE: And I hope you come visit us soon.

DOBBS: You got a deal.

DONOHUE: Thank you.

DOBBS: Coming up next, this country tonight is bracing for yet another hurricane. And this is a big one, headed toward Florida. Gusts are now being measured up to 185 miles an hour. This is a category four hurricane right now, and it could be accelerating. We're going to learn a lot more about this hurricane and the threat that it poses from the head of the National Hurricane Center, Max Mayfield. He'll join us with the very latest on where the storm will hit and when.

It's one tax this administration just can't seem to cut, rising energy prices burdening the middle class. Our series of special reports on the middle class squeeze continues tonight.

We'll be going live to Madison Square Garden, the Republican National Convention. We'll hear from three of this country's top political journalists on this campaign. I'll also be joined by the chairman of the Senate Intelligence Committee, Senator Pat Roberts.

All of that, a great deal more. Those stories, your e-mails, stay with us.

(COMMERCIAL BREAK)

ANNOUNCER: LOU DOBBS TONIGHT continues with more news, debate, and opinion. Here now Lou Dobbs.

DOBBS: All this week, of course, we're reporting on President Bush's plans to fight what we call the middle-class squeeze on this broadcast. Tonight, we're focusing on the rising prices of energy, near record-high prices on oil and gasoline amounting to a tax on middle class families throughout the country, a tax this administration so far has been unable to cut. Peter Viles reports.

(BEGIN VIDEOTAPE)

PETER VILES, CNN FINANCIAL NEWS (voice-over): It was an administration priority before September 11, but despite terrorism, war in Iraq, summer blackouts, $40 oil, $2 a gallon gasoline, the Bush energy plan still languishes in the Senate.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: I submitted a plan to the United States Congress that encourages conservation, encourages research on alternative sources of energy, encourages the use of coal and environmentally friendly ways exploring for natural gas. But in all we do, we better make sure that we no longer have to beg for energy from other parts of the world. This country can do a better job.

VILES: Both candidates agree, America needs a broad energy policy that reduces reliance on oil from the Middle East. The biggest difference, the same one that divided candidates Bush and Gore four years ago, whether to open up a wildlife refuge in Alaska to oil drilling.

TIM ADAMS, BUSH-CHENEY POLICY DIRECTOR: Because it's the best source for domestic exploration, if we're going to move this country toward energy independence, we must promote domestic exploration of oil and natural gas, and work to produce close to a million barrels a day, which is roughly equivalent to what we're importing from Saudi Arabia.

VILES: The Bush plan would also streamline the permitting process for new refineries, encourage new nuclear power plants, and put in place new tax credits for buyers of hybrid and fuel-cell vehicles. Analysts caution, however, oil prices may not respond to any of this.

JAMES HAMILTON, UNIVERSITY OF CALIFORNIA, SAN DIEGO: Energy prices are determined on a world market, they're driven by world events. I think it's been news coming out of Iraq and Venezuela and Russia this year that's moved the oil market, demand coming from China. It's a misconception to think that's something that's controlled in the White House, whoever occupies it.

VILES: Critics say Congress has turned the Bush energy policy into a giveaway to the energy industry, $31 billion in tax breaks that would have little impact on prices paid by consumers.

(on camera): Now, one key pocketbook issue to keep an eye on here, mergers in the utility industry. The Bush administration policy would allow consolidation in that industry, and consumer groups say that would only mean higher utility rates for middle class Americans.

Peter Viles, CNN, Los Angeles.

(END VIDEOTAPE) DOBBS: Joining me now from the floor of Madison Square Garden, more on the Republican National Convention, three of the country's top political journalists, Karen Tumulty, "TIME" magazine, Roger Simon, "U.S. News and World Report," and E.J. Dionne, columnist for "The Washington Post."

Thanks for being here.

First the performances of -- let's turn to the performances of the first lady, the first daughters last night. Karen, what did they contribute?

KAREN TUMULTY, "TIME" MAGAZINE: What about those Bush twins, huh? Well, I think that -- words fail me on the Bush twins. I think "bizarre" might be the first one that comes to mind.

The first lady was her usual sort of calm, reassuring presence. I don't -- you know, she certainly didn't hit it out of the park. But she performed as she always does.

I was sort of surprised, though, that it wasn't more personal about the president. She said several times during the speech, I know him better than anyone else does. And I was sort of expecting some glimpses of him that we haven't seen before. And I didn't see those.

DOBBS: And I'll turn to you, Roger. The Terminator, how did he do?

ROGER SIMON, "U.S. NEWS AND WORLD REPORT": He did great. I just want to defend the Bush twins for a second, though.

DOBBS: Surely.

SIMON: I think (UNINTELLIGIBLE)...

DOBBS: Now, you notice, Ron Brownstein defended the president here, and a day later, is not, no longer with us, Roger.

SIMON: He's out of here, so I want to stay off that subject.

The media always say that these things are too scripted, they're inauthentic, they're too predictable. But yet, when we get a genuine moment from two genuine young women, like it or hate it, then we dump on them.

TUMULTY: Wait a minute, Roger...

SIMON: I assume, I assume...

TUMULTY: ... they were reading from a script.

SIMON: ... they were talking -- but it sounded like a script that could have been written by them, which is why people hated it. I assume that they were talking to their generation. It's not a generation sitting here today, and perhaps we didn't appreciate it. But I think they were supposed to be themselves, and they were. As to Arnold Schwarzenegger, I think it was one of the best speeches I have ever heard at a convention. I have been coming, I'm embarrassed to say, since 1976 to these things. It was very entertaining, and convention speeches are rarely entertaining on purpose. And it was also very tough. It was not compassionate conservatism, it was red meat.

I mean, Arnold Schwarzenegger attacked Hubert Humphrey by name. Hubert Humphrey has been dead for more than a quarter century. And he praised Richard Nixon. So it was yet another red-meat night from what's turning into a red-meat convention. But...

DOBBS: Your thoughts, E.J.?

E.J. DIONNE, "THE WASHINGTON POST": Well, first of all, it is probably the first time in 30 years that a speaker from the podium said so many nice things about Richard Nixon. But I was struck, it was -- there are certain moments that were mean that were kind of hidden by the humor, calling all people who say the economy could be better "girly men" was probably the most extraordinary moment we've seen in the convention so far.

But on the -- on Mrs. Bush's speech, I think that was one of the best political documents that I have seen in a long time, because that speech was very carefully written, almost as a lawyer's brief, to answer the doubts of swing voters, particularly undecided women.

A lot of people say the president is reckless, he makes decisions just off the top of his head. She went out of her way to talk about how deliberate he was and how worried that he was, that the president really kind of likes to go to war a lot of people out there think. No, no, said Mrs. Bush. Nobody likes to go to war and certainly not my husband. I think that that was in some ways the most effective political speech we've seen at the convention.

DOBBS: Yes, I found it interesting. The first lady, I thought, was gracious. I thought she was not trying to put on a performance. And in that I thought was terrific in her performance. All that is happening within that convention, Zell Miller tonight, who will become the first man to ever deliver a keynote speech to both the Democrats and Republican conventions. What can we expect? How effective will it be, Karen?

KAREN TUMULTY, CNN NATIONAL POLITICAL CORRESPONDENT: Well, I think that Zell Miller is a very, at least in my experience in Washington, can be a very effective speaker. And this audience is absolutely going to love him. But the fact is that practically since the first week of the Bush administration when he was, I believe, the first Senate Republican to embrace the Bush tax -- I mean, the first Senate Democrat to embrace the Bush tax cuts, he's been really a Democrat in name only. But I think that he's likely to have much the same effect on this audience that, say, Ron Reagan did at the Democratic convention.

DOBBS: Karen, thank you, Roger Simon, E.J. Deion, we're going to have to break away. We thank you always for your insights, and we'll return to you as quickly as we can. Thank you, folks.

UNIDENTIFIED MALE: Thank you.

DOBBS: That brings to us the subject of our poll tonight, have the Democratic and Republican conventions influenced your vote, yes or no. Cast your vote at cnn.com/lou. We'll have the results coming up later in the broadcast.

And tonight's thought is on elections. When the shadow of the presidential and congressional election is lifted, we shall, I hope, be in a better temper to legislate. Those are the words of the 20th president of the United States, James Garfield.

Turning now to a rapidly developing story about the massive hurricane, in fact, a category four hurricane, that is approaching the Bahamas barreling toward the east coast of Florida, Governor Jeb Bush has declared Florida to be in a state of emergency. Hurricane Frances is currently a category four storm. It has sustained winds of 140 miles an hour, wind gusts rising as high as 185 miles an hour. Now, for the very latest on the storm I'm joined by Max Mayfield, the director of the National Hurricane Center in Miami. Max, first, thanks for taking time in what I know is a very busy period for you. What the latest developments?

MAX MAYFIELD, DIRECTOR, NATIONAL HURRICANE CENTER: Well, Lou, you said it's a very powerful and a very dangerous category four hurricane on our Sanford/Simpson (ph) hurricane scale. It's still, you know, a couple days away. We don't want to focus on that landfall point. Let's not make the same mistake that some people did with Charley. This is a much larger hurricane than Hurricane Charley, so wherever it hits, it will have a big impact of a large area.

DOBBS: There's another mistake I think that you would agree is not being made, Governor Bush already declaring a state of emergency. As I go through this list. Palm Beach County has issued a mandatory evacuation order for 300,000 residents there living across the coast. Brevard County urging 185,000 of its residents to evacuate by tomorrow. Indian River County, shelters already being set up. The right response?

MAYFIELD: Oh, absolutely. We've been talking with the state and local emergency managers actually all week long here in Florida. They've got some of the best people anywhere in the coastline and the inland counties as well. What we don't want to do though is have that shadow evacuation. You don't want people to evacuate unless they're told to do so by their local officials.. You know, if you live in a well constructed house outside of the storm surge evacuation zone and not in a mobile home, don't add to the traffic congestion by getting on to the roads and leaving.

DOBBS: And, Max, with the storm behind you there, what is your sense of it? I know this is difficult, but what is your sense of the strength of this hurricane? I know it's likely to weaken with landfall, but this seems somewhat more powerful than most storms.

MAYFIELD: Yes, yes. It certainly is. We don't have very many. We've had, I believe, 14 category four hurricanes, three category five hurricanes in the last 10 and some odd years. So we don't really see anything to make us think that this will weaken significantly. People need to be preparing as if they're going get hit by a major hurricane. We likely will see some fluctuations. It may weaken a little bit. But we really think it'll regain that strength. And right now, it's a very solid category four hurricane.

DOBBS: Max Mayfield, the director of the Hurricane National Center, as always we depend upon you for your insight and judgment on these things. We thank you for taking the time.

MAYFIELD: Thank you, sir.

DOBBS: Taking a look at some of your thoughts on our reporting on this broadcast. On "Broken Borders" specifically tonight, Patricia from Florida. "How can our government even suggest giving Social Security benefits to illegal aliens? It seems that everything I've ever worked hard for or dreamed of owning is now just handed over to illegal immigrants who possess no loyalty to this country."

Bob in Ohio. "Lou, explain to me why Greenspan says we might have to cut Social Security benefits and at the same time they are talking about giving illegal immigrants benefits."

Ilayudine (ph) from Arizona. "My parents escaped Hitler and Stalin and came here legally after waiting years and years to be admitted. Back then, they had to be healthy, to speak English and know the Constitution, among other things. Please, please, please know how many millions and millions of American citizens are desperate to have something done about this issue."

And Dale in Nevada. "Since NAFTA is so valuable to Mexico, why not make Mexico's continued participation in NAFTA contingent upon Mexico's genuine and effective effort to curb illegal immigration."

We love to hear from you. We love to share your thoughts. Send us your thoughts at loudobbs@cnn.com. And please send us your name and address. We are sending each of you whose e-mail is read on this broadcast a copy of my new book "Exporting America."

Coming up next, can we win the war on terror? Conflicting messages this week from the president. Senator Pat Roberts, chairman of the Senate Intelligence Committee. He joins me next from the Republican National Convention.

And exporting America, Senator John Kerry says he has a plan to help stem the flow of American jobs to cheap foreign markets. Roger Altman, senior economic adviser to the Kerry campaign, will be with us. Please stay with us.

(COMMERCIAL BREAK)

DOBBS: President Bush this week raised the possibility that the war on terror may be unwinnable. The president later made clear he believes the United States will win. But the president's remarks opened a debate about what constitutes victory in the global war against radical Islamist terrorism. I'm joined now by the highly respected chairman of the Senate Intelligence Committee, Senator Pat Roberts. Senator Roberts joins us tonight from the Republican National Convention in Madison Square Garden. Senator, good to have you with us.

SENATOR PAT ROBERTS, CHAIRMAN, SENATE INTELLIGENCE COMMITTEE: Lou, thank you. And you should be here. There's a chant behind me. They're asking for your name. Lou, Lou, Lou. They're chanting. They want you.

DOBBS: I'm sure they do, particularly the White House. And we won't specify why they would want me. Senator, we would like to address a number of issues. There's so many things going on this evening, but let me begin first, hundreds of people being held hostage in southern Russia tonight by radical Islamist terrorists, hundreds of them children. We have seen the violence that has erupted after a period of respite in Israel. Israel blaming Syria now for the actions of Hamas. Iraq radical Islamist terrorism goes on there. What is the United States, what is the civilized world to do?

ROBERTS: Basically you have to be resolute. You have to understand this is an international war against terrorism. This isn't anything new for Russia. There's a fellow called Besiov (ph). I think I have pronounced that right. He's the fellow that was behind that attack where they held the hostages in the theater. Now they've got a school, two airplanes, bus. Putin has said this is a war. Putin even suspects after he met with Chirac and Schroeder that basically there may be a tie to Al Qaida. One of the good things that's happening, and there isn't much good about this, is that NATO is now considering this. I hope this wakes up Europe to the fact that they will be able to contribute more to NATO. This is the kind of thing that NATO can step up. We're doing everything we can with the Russians, in terms of sharing our intelligence information to be of help.

DOBBS: Senator, the fact that Israel has singled out Syria, expecting retaliation, will that be in point of fact in the interest of the United States as we pursue this global war on terror? Is it simply absolutely necessary for Israel to conduct its policy in that way?

ROBERTS: Well, you can't dictate what another nation will do in terms of its sovereign or national interest. But we had a six months time period where we didn't have these attacks, and we thought we were making progress. Then you have, what is it, 16 people killed, horrible picture on the front of the "New York Times." Just a dreadful occurrence. And the Israelis truly believe that that came from Hamas and also from Syria. So they are threatening an attack at the source. Now, obviously, if their intelligence sources are accurate, that is a response they may well take. They have in the past. That is a situation that is ongoing just as well, just as the situation in regards to Iran. Now they are enriching their uranium, according to the IAEA, with enough of that to, what, I think five nuclear devices.

DOBBS: Right. Correct. ROBERTS: And then you have the situation in regards to the Sudan. The U.N. has to step up, can't just pass resolutions. Kofi Annan says we need 3,000 peacekeepers. I haven't seen too many people raise their hands. We, and I'm talking about the United States, have asked the African security council to send in 2,000 peacekeepers. Until we do something like that resolute in regards to the U.N., I'm afraid we're in for a tough time in regards to those poor folks in Sudan.

DOBBS: What was your reaction, Senator, when you heard President Bush say the war against terror is unwinnable?

ROBERTS: Well, you know, I heard a lot about that. And, of course, my friends across the aisle have made a big thing about that. I think he's talking about the fact that you're not standing on the USS Missouri with McArthur and saying OK, there is now peace and here's the treaty and you sign it and here's the understanding and here's the occupying force, and then we're going to have peace on down the road. That's not the case with this war. This war is a very nebulus war of attrition, by various terrorist groups. I think that is what he was referring to in terms of, quote, "winning the war against terrorism." I certainly think that he said, as of today, certainly, we will try to win it in terms of making America safer and the world safer.

DOBBS: Making America safer, restructuring the CIA and creating the national intelligence director, your proposals. Acting director of the CIA, John McLaughlin described your plan to divide the CIA as a step backward. Will you be talking with the acting director soon?

ROBERTS: I have contacted all 15 heads of the intelligence agencies in terms of personal conversation. I have tried to point out to people we are not trying to dismantle the CIA by any means. We have many fine people working for the CIA doing an outstanding job, laying their lives down for this country. But every time they come before the intelligence committee, Lou, they say we need more authority, certain priority funding. They've had the authority since 1947. We have tried 38 times to reform the intelligence community. Now that we have real reform and we step back from the trees and said, all right, we're not going to consider turf or committees or agencies, what would you do to have a national intelligence service. We're going to have a national intelligence director. We're going to enhance the CIA's position in regards to collection and also analyzing. They'll do a better job.

DOBBS: Senator Pat Roberts, we thank you very much for being with us here, as always.

ROBERTS: Lou, thank you so much.

DOBBS: Still ahead here, exporting America, Senator John Kerry says American companies must be more competitive to keep American jobs in this country. Is Senator Kerry backing away from his opposition to exporting? We'll find out. I'll be talking with Senator Kerry's senior economic adviser, Roger Altman. He's next. Stay with us.

(COMMERCIAL BREAK)

DOBBS: Well, Senator Kerry says that he will fight the shipment of American jobs to cheap overseas labor markets. He says lower health care and energy costs, corporate tax credits, all of those issues are definitive with the campaign. I am joined now by one of the campaign's senior economic advisers, in fact, an old friend, Roger Altman. Good to have you here.

ROGER ALTMAN, KERRY CAMPAIGN SENIOR ECONOMIC ADVISER: Thanks for having me, Lou.

DOBBS: Roger, let's be clear about this thing on outsourcing. You've heard the head of the chamber of commerce, we've heard the Bush administration say it's absolutely necessary that jobs be outsourced to cheap labor markets to keep this economy vigorous. Meanwhile, we're not creating jobs in this country at a rate to keep up with the rate of the growth of the labor force. What's the senator's position? For it, against it?

ALTMAN: Well, first of all, the difference between the two candidates on this issue, outsourcing, is the difference between night and day. One candidate says, it's good for the country, let's have more of it. Another candidate says, we need to do something about this, we need to strengthen the competitiveness of our employees. We need to lower the cost of doing business for our employers to help us keep more jobs here and create more jobs here. Big, big difference.

DOBBS: It's a big difference, but perhaps it's not one that is distinct, at least for me, if I may say. The fact is that this Democratic candidate for president said that the CEOs who send these jobs to cheap labor markets kill an American job to create one in a cheap foreign labor market are Benedict Arnold CEOs. We haven't heard him say that recently. We haven't heard a real specific plan to say to corporate America, you're not going to run this country. The country is going be run by the people. The Democratic party is the party traditionally for working men and women in this country, yet we see corporate interests with significant influence in both campaigns.

ALTMAN: Well, I think Senator Kerry is saying this. Let me try to be as clear as I can.

DOBBS: Surely.

ALTMAN: First, we can't build walls around the country. We can't ban outsourcing. What we can do is strengthen the employment base in this country and make our country more competitive and get back our fighting edge, get back our competitive edge. That's why he has said I want to lower the cost of doing business for American employers. I have got a plan to get health care costs down.

The rate of inflation in health care costs three to four times the rate of inflation in the rest of our economy. We've got to get energy costs down. We all know they're way out of control and hurting business badly. He's going to cut corporate tax rates, and he's going to say for any new job created in manufacturing and other categories vulnerable to outsourcing over the next two years, the employer will be relieved of the payroll tax cost of that new job, payroll tax holiday.

Those four points as a pro-competitiveness, pro-employer program for this country. Mr. Bush is saying, let's - you know, he's saying, in effect, let's get it on with more outsourcing. And I don't know how you could have a starker difference. If the question is Senator Kerry want to ban outsourcing, pass a law to prevent it? No, he doesn't because he knows we are in an integrated global economy and some of it is going to occur and some of it in the long run is healthy. But a lot of it does not have to occur. And that's the difference.

DOBBS: Well, then, let's ask the question. How much of it is necessary and by whose judgment is it?

ALTMAN: Well, Lou, I can't give you a number, but what I can say is...

DOBBS: OK. The reason I ask that is that the ambiguity has got to be alarming to millions of folks in this country who work for a living. They're faced with rising energy prices, as you say. They are faced with all sorts of burdens, rising education, as well as health care costs. The need to drive job creation in this country and yet free trade was an invention at least through NAFTA of the Democratic party, a Democratic president who you were serving. In point of fact, we have seen NAFTA does not work as it's currently constructed. The WTO is certainly challengeable in a host of areas. But a chronic trade deficit, where does he differ with the president on those issues?

ALTMAN: Well, first of all, we have to get our own economy to perform better. Part of the reason we have such a large trade deficit is that our own economy is not performing at an optimal level. I mean, I think you know the numbers. The Bush economic record, which parenthetically we haven't heard a word about the first two nights of this convention. Ask yourself why that is. Nevertheless it's the slowest...

DOBBS: This audience doesn't need to pose rhetorical questions.

ALTMAN: It's the slowest growth rate in a recovery in 70 years. Forget the tech bubble, the corporate scandals, 9-11, what they talk about. Measure it from the beginning of the recovery. Slowest growth rate in 70 years, worst job record in 70 years. Family incomes the acid test, the acid test, down under President Bush, down a lot. Every one of the eight Clinton years they were up.

DOBBS: Roger Altman, as always, good to talk with you.

ALTMAN: Thanks for having me.

DOBBS: A reminder now to vote in our poll. The question is have the Democratic and Republican conventions - although this one is not quite concluded - influenced how you will vote come November. Please vote yes or no. Cast your vote at cnn.com/lou. Results are coming up just in a moment. Also ahead we'll have your thoughts on the outrageous report showing how much corporate CEOs are profiting from the shipment of American jobs overseas. Stay with us.

(COMMERCIAL BREAK)

DOBBS: Taking a look now at more of your thoughts, many of you writing in about our report last night on CEOs making millions of dollars more when American jobs are shipped overseas, at the conclusion of a recent report.

Patrick in Dallas, Georgia. "Lou, I feel so much better about outsourcing our jobs now. CEOs who outsource get more money and we get to watch a movie on it. Wow, what a deal."

A reference, by the way, to the movie coming out "Outsourced."

Scott Awalls (ph) of Arvida (ph), Colorado. "These CEOs care only about their own wallets. How can the American people continue to afford products made in this country when they can't find a job that pays them enough to live on."

In our series of special reports on the middle class squeeze, Christopher Durby (ph) in Brainerd, Minnesota. "Thanks, Lou, for making the point that the middle class is under attack through the exporting of our jobs. I wish our elected officials defended our jobs as much as you do."

We thank you for being with us and we love hearing from you. Send us your e-mails at CNN.com/lou. Please include your full name and address. if your e-mail is read here, we send you a copy of my new book "Exporting America."

And still ahead here, the results of tonight's poll. And we'll have a preview of what's going to be here tomorrow. Stay with us.

(COMMERCIAL BREAK)

DOBBS: The results of our poll tonight. Ninety-three percent of you say that neither the Democratic nor Republican convention has influenced the way you're going to vote in November. And the second most powerful Republican in the U.S. Senate will be joining us here tomorrow. We hope you will as well. That's it from New York for tonight. I'm Lou Dobbs. Thanks for being with us. Good night from New York City. "ANDERSON COOPER 360" coming right up.

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