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Lou Dobbs Tonight
Insurgents Bomb Wedding Party; New Bush Doctrine Calls for Leading World to Democracy, Blair Silent; Dems Promise to Speak Out on Issues
Aired January 21, 2005 - 18:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
(BEGIN VIDEOTAPE)
KITTY PILGRIM, HOST (voice-over): Tonight, insurgents explode a huge car bomb near a mosque in Baghdad. Factional violence is escalating. Is Iraq on the brink of civil war?
JOHN NEGROPONTE, U.S. AMBASSADOR TO IRAQ: We're doing everything we can to ensure that security conditions permit people to vote.
PILGRIM: "The Bush Doctrine:" President Bush declares he'll spread democracy around the world. Tonight, why this country's closest ally is no longer giving the United States its unequivocal support.
Exporting safety? Some of our biggest airlines outsource vital maintenance work to cheap overseas labor markets. We'll tell you why you should be concerned.
UNIDENTIFIED MALE: When we go overseas, we find that there is no security background check being done on these individuals.
PILGRIM: And deep freeze. A huge snowstorm will bring chaos to many parts of this country this weekend. Tonight, where the storm is headed and when it will strike.
(END VIDEOTAPE)
ANNOUNCER: This is LOU DOBBS TONIGHT for Friday, January 21. Here now for an hour of news, debate and opinion, sitting in for Lou Dobbs, Kitty Pilgrim.
PILGRIM: Good evening.
Tonight there are fears Iraq is on the brink of a civil war. That could make it much harder for the United States to achieve its goals.
Terrorists today blasted worshippers near a mosque in Baghdad, killing at least 14 people. The attack was the latest assault on the majority Shiite community. It comes just nine days before Iraq's election.
Jeff Koinange reports from Baghdad.
(BEGIN VIDEOTAPE) JEFF KOINANGE, CNN CORRESPONDENT (voice-over): More than a dozen lives were destroyed by a car bomb just after Friday morning prayers at this Shia mosque on the southern edge of Baghdad.
And a little further south, a celebration turned tragic when an ambulance drove into a wedding party and exploded. Several people, including the suicide bomber, were killed, and a large number of guests were wounded.
And in the town of Heet in the volatile Sunni Triangle, insurgents attacked a police station, using rocket-propelled grenades and machine guns. They ransacked the station, took the weapons, blew up the building, escaping in two police cars.
And a follow-up videotape has been released by the group calling itself the Islamic Resistance Moment, the group that says it kidnapped eight Chinese hostages several days ago.
A voice on the tape demands the Chinese government forbid its citizens from entering Iraq, adding this would be considered a positive gesture in granting mercy on the hostages.
The U.S.'s highest-ranking diplomat in Iraq says the landmark elections will prove a turning point for the country.
NEGROPONTE: I think this election is a very, very important milestone towards the establishment of an enduring democracy here and a system of government whereby Iraqis will be able to settle their differences through peaceful, political means.
KOINANGE: Salad Hadin Mekbi (ph), a government engineer, agrees and voices the feelings of a terrified community.
UNIDENTIFIED MALE (through translator): We hope that these elections will bring a better future for the Iraqi people. I have high hopes for the future to get better and better.
KOINANGE (on camera): Just how soon things can get better is anyone's guess. Right now Iraqis are just hoping to get through a day without violence, something that seems less and less likely as the election day draws near.
Jeff Koinange, CNN, Baghdad.
(END VIDEOTAPE)
PILGRIM: The Pentagon has approved a huge incentive plan to stem the flow of Special Forces troops out of the military.
Military officials are increasingly concerned about the rising number of experienced Navy SEALs, Army Green Berets, and other troops who are quitting at the end of their enlistments. Many of those troops are joining private contractors who pay much higher salaries.
The Pentagon says the incentive package is worth $168 million over three years. The Iraqi elections are the first big test of the new Bush doctrine of spreading freedom around the world. The president made liberty the centerpiece of his inauguration speech yesterday, but the president is not saying how far he will go to spread democracy.
White House correspondent Suzanne Malveaux reports -- Suzanne.
SUZANNE MALVEAUX, CNN CORRESPONDENT: Well, Kitty, as a matter of fact, today we saw the end, the final end of the pomp and circumstance for the ceremonies for the inauguration for the president.
Of course, the focus changing now, this to the president's agenda, the statement he made in his inaugural address yesterday, talking about the focus to bring democracy and freedom around the world. Let's take a listen.
(BEGIN VIDEO CLIP)
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: Today, America speaks anew to the peoples of the world. All who live in tyranny and hopelessness can know the United States will not ignore your oppression or excuse your oppressors. When you stand for your liberty, we will stand with you.
(END VIDEO CLIP)
MALVEAUX: Now, Kitty, there are some Bush critics as well as political observers who say they believe this could send a message to nuclear powers like North Korea or Iran, some sort of potential threat.
Some senior administration officials say he does not necessarily see it that way, but clearly, the Bush administration is going to be faced with a delicate balancing act, on the one hand, rewarding those allies in the war on terror, at the same time, of course, holding some of them accountable for those human rights and democratic reforms.
The president faces his first big test when it comes to how persuasive he will be in bringing forward that message of democracy. That is when next month he meets with the Russian president, Vladimir Putin, to push forward in what some of those things they see perhaps as anti-democratic steps that Russia has taken over the last couple months -- Kitty.
PILGRIM: Thank you very much, Suzanne Malveaux.
Well, there's been a cool reaction in Europe to President Bush's inauguration address. That's not surprising, because President Bush faces opposition in countries such as France and Germany.
More troubling is the fact there's rising concern about the president's policies in Britain, our closest ally.
Robin Oakley reports from London.
(BEGIN VIDEOTAPE) ROBIN OAKLEY, CNN CORRESPONDENT (voice-over): President Bush may have wowed Washington by pledging to take on tyrannies across the world, but the media in Britain reflected a different mood.
"The Guardian" called it the most combative inauguration speech in 50 years. To "The Daily Mirror," it was "messianic" and "warlike."
And with Washington highlighting Iran's nuclear arms ambitions, the same note of alarm was sounded by a former member of Tony Blair's cabinet.
ROBIN COOK, FORMER U.K. FOREIGN SECRETARY: This is no time to start imposing liberty from 38,000 feet through a bomb thrown in another country.
OAKLEY: Mr. Blair, soon to face his electors, has lost support by backing the war in Iraq. He offered no comment on the speech. And analysts note he hasn't rushed to endorse Condoleezza Rice's new list of the six outposts of tyranny: Iran, North Korea, Burma, Cuba, Belarus, and Zimbabwe.
PETER KELLNER, POLLSTER: I can see no circumstances whatsoever in the next few years in which it would be politically possible for a British government of any political character to support another military action by the United States.
OAKLEY: Since Blair's opinion poll rating drops every time he's seen with him, Mr. Bush shouldn't expect an invitation to Britain before this year's general election.
On Iraq, the two are bound together. But analysts say that on other issues, Mr. Blair will be quite happy now to emphasize his detachment.
On Iran, Britain's backing France and Germany on maintaining a dialogue, not a confrontation. And Mr. Blair says he's ready, like the rest of the European Union, to defy Washington by ending the embargo on arms sales to China.
JACK STRAW, U.K. FOREIGN SECRETARY: There is an issue of consistency here, because there are embargoes on China, Zimbabwe and Burma. There's not an embargo, for example, in respect to North Korea, which has a terrible human rights record.
OAKLEY (on camera): Elections shape political tactics. Mr. Bush has won his contest. Now for Mr. Blair, there's clearly a benefit in stepping gently away from White House rhetoric, at least for awhile.
Robin Oakley, CNN, London.
(END VIDEOTAPE)
PILGRIM: On Capitol Hill, Democrats are defiant as President Bush pushes sweeping domestic reforms. Democratic lawmakers are promising a tough fight against what they call Republican, quote, "extreme policies," unquote. Congressional correspondent Joe Johns has our report.
(BEGIN VIDEOTAPE)
JOE JOHNS, CNN CORRESPONDENT (voice-over): Despite the drumming they took in the last election, there is plenty of fight left in congressional Democrats.
SEN. HARRY REID (D-NV), MINORITY LEADER: We will work with the president, but I do say this, that we're not going to shy away from living up to the values and priorities that we believe are important in our country today.
JOHNS: Standing their ground early in the new Congress on issues that seem all but settled, some top Democrats on the Senate Judiciary Committee, including Senator Edward Kennedy, are pressing Alberto Gonzales, the president's pick for attorney general, to answer more written questions about his views on the law, because they see some of his answers to earlier questions as unsatisfactory and evasive.
Some other Democrats, including senators Barbara Boxer and Robert Byrd, slowed down the confirmation vote of Condoleezza Rice for secretary of state because they wanted more time for debate.
The administration is not happy.
ANDREW CARD, WHITE HOUSE CHIEF OF STAFF: We all know that Dr. Rice will be a great secretary of state. And she should move into that position quickly, and I wish the Senate would confirm her. But you know, petty politics is playing a role in this, and that's unfortunate.
JOHNS: Democrats also forced a debate on election reform by holding up the counting of Ohio's electoral votes, delaying the certification of President Bush's election for a couple of hours.
So what's the point? With diminished power, Democrats say they'll use congressional procedures where they can to highlight Social Security and five other issues.
REP. NANCY PELOSI (D), MINORITY LEADER: Health, education, jobs, clean environment, strong national defense, with accountability in terms of spending.
JOHNS: But with battles over the judiciary ahead in the Senate and even a possible Supreme Court nomination, some Democrats say it's a risky strategy to complain too much.
WILL MARSHALL, DEMOCRATIC LEADERSHIP COUNCIL: You have to pick your fights carefully. Democrats shouldn't go after every single judge nomination, and they don't.
JOHNS: And a former Democratic senator who just left Capitol Hill is urging his ex-colleagues not to get off on the wrong foot.
JOHN BREAUX (D-LA), FORMER SENATOR: Try to find ways to work together because, if we don't, there will be nothing that will be done in the Congress. It will be total stalemate, and, in that case, everybody loses. Both parties lose.
(END VIDEOTAPE)
JOHNS: For their part, Congressional Republicans say they will not allow the feistiness of the Democrats to get out of hand. For starters, Republicans say, they plan a spirited defense of Condoleezza Rice when the nomination comes up next week -- Kitty.
PILGRIM: All right. Thanks a lot.
Joe Johns.
New developments tonight in the escalating United Nations oil- for-food scandal. Now it follows reports that former President Jimmy Carter and former vice-presidential candidate Jack Kemp met an Iraqi- American businessman involved in the scandal.
Senior United Nations Correspondent Richard Roth is here with the report -- Richard.
RICHARD ROTH, CNN SENIOR UNITED NATIONS CORRESPONDENT: Kitty, developments, though we don't know if it really means anything at this point or will amount to anything.
The leader of one U.N. oil -- the U.N. oil-for-food investigation, Paul Volcker, has said oil for food is complicated. If you peel away one level, you find something else. Not surprisingly, you're going to see the names of public figures come up as several oil-for-food probes continue, especially when a defendant decides to cooperate.
This week, we saw the first person to plead guilty in the oil- for-food case, Samir Vincent, an Iraq-American businessman who bought oil from Iraq and resold it at a great profit. Baghdad also gave him hundreds of thousands of dollars to lobby to get sanctions lifted on his country.
Vincent was convicted among other things of failing to register as an agent of a foreign government. Since the Justice Department says Vincent tried to lobby former Clinton and Bush administration officials on behalf of Saddam Hussein, it was only a matter of time since a name or two was disclosed.
However, there's absolutely no indication whatsoever that the people who met with Vincent did anything improper.
Former Republican vice-presidential candidate Jack Kemp confirms to CNN he answered questions about Vincent from the FBI several months ago. He said he cooperated fully and that they had no further questions. Kemp told CNN he met with Vincent after the Iraqi-American called after reading a column Kemp wrote on the Middle East on economic development.
At one point, Kemp put Vincent's name on a planned committee to establish a Marshall Plan in Iraq after the fall of Saddam. He was one of two dozen people on that list, but the committee never got started.
Kemp says he never advocated with the Bush administration a program for sanctions to be lifted. First, Kemp said, there needed to be full access for weapons inspectors.
Kemp says his ideas on Iraq were rebuffed by the Bush administration.
Former President Jimmy Carter also crossed paths with Samir Vincent. He was present when Carter met with Iraqi clerics in early 1999 to hear their views on the plight of children in Iraq and the impact of U.S. sanctions.
Jimmy Carter has not been interviewed by the FBI and says he did not lobby the Bush administration to get sanctions lifted.
Another Washington figure, former Defense Secretary Frank Carlucci, reportedly gave a good reference on Vincent to Kemp. Carlucci and his firm, The Carlisle Group, deny doing any business with Vincent or his company, Phoenix International.
Another name on Kemp's proposed committee, former U.N. Ambassador Richard Holbrooke. He says he never heard of or met Vincent -- Kitty.
PILGRIM: Richard, this is a lot of detail, and, as you say, you peel off layer after layer, you keep getting down. When is the final Volcker report going to be released?
ROTH: The Volcker interim report originally scheduled, we told you here on Monday, for the 31st of January now highly likely February 7, and that's just an interim report. It's going to be months away for his report, and you can expect this year to be filled with congressional reports and maybe even a congressional leak or two.
PILGRIM: And lots more detail.
Thanks very much.
Richard Roth.
Well, still to come, "Deep Freeze." A massive winter storm sweeping across the country, and, tonight, we'll tell you when and where the storm will strike.
And "Power Play." How an old-fashioned Latin American strongman believes he can threaten the United States, our oil supplies and get away with it.
(COMMERCIAL BREAK)
PILGRIM: An arctic blast is driving temperatures down to the single digits across large parts of the country tonight.
North Carolina -- residents were greeted with another snowfall this morning, and the snow has wreaked havoc on roads in Raleigh, and over a thousand road accidents were reported. None, however, fatal.
And now residents in the Northeast and the Midwest are bracing for the first major snowstorm of the season. Now this is a live picture from our affiliate KARE in Minneapolis, Minnesota, where the snow is already making driving pretty dangerous.
Rob Marciano is at the CNN Weather Center and has the latest on the snowstorm. -- Rob.
ROB MARCIANO, CNN METEOROLOGIST: Hi, Kitty.
Snowing heavily at last observation in Minneapolis, as you saw, and they've already seen three to five inches of snow already. More on the way.
And this thing is steadily marching toward Chicago along a very strong and strengthening jetstream that will eventually pick up some moisture as well.
Out of the Dakotas this thing has come, and into the Minnesota area where, as mentioned, three to five inches of snow have already fallen, and they're in the thick of it right now.
This moisture stream will continue to pour eastward, engulfing the Chicago area later on tonight where winter storm warnings are posted for 10-plus inches of snow there, and then that moisture coupled with the Gulf of Mexico moisture and eventually some Atlantic moisture is going to run into some extremely cold air.
Bitterly cold air expected tonight. Again, 12 in New York, 18 in D.C., 18 in Chicago. So, certainly, cold enough for snow pretty much everywhere north of the Mason Dixon line.
So we do have a weekend of heavy snow potential that is pretty high. Look at these snow tallies as this thing marches off to the East -- again, 8-plus, probably 10-plus in Chicago -- picks up some moisture, slams it across the western slopes of the Appalachians, maybe a foot or more there, then taps the moisture from the Atlantic Ocean, the gulf stream there, a little bit warmer. Sometimes these things get cranking a little bit more from that.
So Saturday night into Sunday morning is when we expect the heaviest snow to begin from, say, Baltimore up through Philadelphia, up I-95 towards New York, and now we've stretched this 12-inch plus line a little bit farther north.
And the National Weather Service has issued a blizzard warning effective tomorrow through Sunday morning for the New York City area and through much of Long Island with winds gusting at 35 miles an hour there, low visibility, and biting cold temperatures.
This snow will stick around. Temperatures easily below freezing from D.C. up through Boston tomorrow. That's the latest from here. We'll keep you updated throughout the weekend.
Kitty, back to you. PILGRIM: Well, we know it's coming at us. Thanks very much.
Rob Marciano.
Thanks, Rob.
Well, those cold temperatures have sparked the biggest rise in fuel demand in the past 14 years. Oil prices today came close to $50 a barrel. The spike in demand causes the United States to be more and more dependent on foreign oil.
Now Secretary of State nominee Condoleezza Rice took on one of main countries supplies those imports during her confirmation hearings.
(BEGIN VIDEO CLIP)
PILGRIM (voice-over): Condoleezza Rice surprised many by underlining troubled relations with Venezuela during her confirmation hearing.
CONDOLEEZZA RICE, SECRETARY OF STATE NOMINEE: It's extremely unfortunate that the Chavez government has not been constructive, and we do have to be vigilant and to demonstrate that we know the difficulties that that government is causing for its neighbors.
PILGRIM: The problem is Venezuela supplies some 13 percent of oil, and it's the fourth largest supplier for U.S. oil.
Last year, in a fiery speech, Chavez threatened to cut off oil exports to the United States, and, in the current international climate with the war in the Middle East, that is a worry.
CAROL GRAHAM, BROOKINGS INSTITUTION: Particularly given that we've got lots of other problems with oil-producing countries elsewhere on the globe, no, we need Venezuela's oil. It's been -- it's always been sort of a touchy relationship because of that. It's very difficult to completely pick a fight with Venezuela.
PILGRIM: Chavez has gone out of his way to antagonize the United States, befriending Saddam Hussein and Cuba's Fidel Castro. He routinely indulges in long tirades against the United States.
Regional experts point out Chavez may talk tough, but Venezuela also needs the U.S. market.
PETER MAXIM, INTER-AMERICAN DIALOGUE: It's a mutual dependence. Venezuela sends its oil to the United States. The refineries for the kind of oil Venezuela produces are found only in the United States. So Venezuela doesn't -- can't just from one day to the next ship its oil to other markets.
PILGRIM: The relationship between Chavez and the United States turned bitter during a 2002 coupe when Chavez accused the United States of backing opposition leaders to oust him. He regained power within two days, but the incident poisoned the relationship. (END VIDEOTAPE)
PILGRIM: Now most regional experts say Condoleezza Rice was correct to point out how disruptive Chavez is to the region and say Chavez' continuing role as a force against democracy will likely increase during the second term.
Still ahead, how some major airlines may be compromising our safety and security just to save a buck. We'll have a special report.
And the senator who calls the need for immigration reform the most urgent problem facing this country. He'll join us.
(COMMERCIAL BREAK)
PILGRIM: In "Exporting America" tonight, some of this country's largest airlines are exporting critical maintenance work to cheaper foreign labor markets. Now critics say it poses a threat not only to American jobs, but to our national security as well.
Lisa Sylvester reports from Washington.
(BEGIN VIDEOTAPE)
LISA SYLVESTER, CNN CORRESPONDENT (voice-over): You might have never heard of Taca airlines, El Salvador's official airline, but you may have flown on a plane that was overhauled by their mechanics.
U.S. carriers, including JetBlue, are increasingly farming out heavy maintenance work overseas. JetBlue sends its airlines to El Salvador and Canada for major maintenance overhauls every 15 months.
America West Airlines also sends some of its planes to El Salvador for maintenance; Northwest Airlines, to Singapore and Hong Kong.
American Airlines does the least amount of maintenance outsourcing, but even their mechanics have noticed problems.
DANNY GONZALES, AMERICAN AIRLINES MACHINIST: Some of that stuff is outsourced, and we get it back, and we have to redo it. And I keep telling management here, is that you're wasting more money, more time.
SYLVESTER: Since 1988, the number of foreign repair stations doing work for U.S. carriers has increased 325 percent, according to the AFL-CIO transportation and trades department. At the same time, thousands of American maintenance jobs have been lost.
The foreign repair shops have to be certified by the Federal Aviation Administration, and supervisors have to be licensed by the FAA, but the individual mechanics working on the plane do not have to be FAA-licensed. JetBlue defends the use of foreign maintenance workers.
DAVE RAMAGE, VICE PRESIDENT, JETBLUE: There's almost an inference that if you go outside the borders of the States that you're getting a lower-quality work, and, quite frankly, that is so far from the truth that it's amazing that people would think that because these companies are required to perform for the same standards as everybody else.
SYLVESTER: Critics are concerned not only about the thousands of American jobs lost and safety concerns, but also the risk to national security. U.S. airline mechanics have to pass an FBI background check, but the FAA does not require foreign workers to submit to a similar background test.
MARK TAYLOR, AIRCRAFT MECHANICS FRATERNAL ASSOCIATION: Now, when we go overseas, we find that there is no background check being done on these individuals, and they're performing the same exact work that we do inside the United States.
(END VIDEOTAPE)
SYLVESTER: The FAA would not make anyone available for an interview today, but the agency says it has improved its oversight of maintenance outsourcing. It requires air carriers to submit a list of the foreign repair shops, and FAA inspectors do perform on-site visits to make sure the shops are following U.S. maintenance guidelines -- Kitty.
PILGRIM: All right. Thanks very much.
Lisa Sylvester.
Well, that does bring us to the subject of tonight's poll. Do you believe that outsourcing maintenance on U.S. airplanes to foreign countries poses a risk to air travel? Yes or no. Cast your vote at loudobbs.com. We'll bring you the results later in the show.
Also ahead tonight, "Border Crisis." Why one high-profile senator says immigration reform is our nation's most urgent concern.
And then "Assault on the Middle Class." Why some say job security is a thing of the past for working Americans. Our special report is next.
(COMMERCIAL BREAK)
ANNOUNCER: LOU DOBBS TONIGHT continues. Sitting in for Lou Dobbs, Kitty Pilgrim.
PILGRIM: In a moment, I'll talk with Senator Chuck Hagel about his plan to reform immigration in this country.
But, first, these stories.
The body of a Wal-Mart cashier was found today in Texas, 400 miles from where she was abducted Wednesday night. A suspect is in custody in Arizona. Pictures of the kidnapping were captured on a Wal-Mart surveillance tape.
The head of the Federal Communications Commission is stepping down. During his four years in the post, Michael Powell cracked down on indecent material and fought for deregulation of the telecom industry. In a statement today, Powell said he plans to spend time with his family before pursuing other opportunities.
And there's stormy weather in space tonight after some massive solar explosions, and those explosions, known as flares, could trigger an amazing display of northern lights tonight, but those flares can also disrupt satellites and communications networks.
We have reported extensively here on our nation's border crisis. As many as three million illegal aliens crossed our boarder last year. My guest tonight says immigration reform is the most urgent problem in America.
Senator Chuck Hagel is a member of the intelligence committee and foreign relations committee. He's also chairman of the subcommittee on international economic policy, export and trade promotion. And Senator Hagel joins us from Washington.
Thanks for being with us, sir.
SEN. CHUCK HAGEL (R), NEBRASKA: Thank you, Kitty.
PILGRIM: You know, the most important issue, when you have Social Security reform and others, that does get attention, and we are giving it full attention, as you know, on this show. Why do you say this?
HAGEL: Well, because our borders, north and south, thousands of miles, are the most critical, urgent issue facing our country. Why? It is security. It's economics.
And to continue to defer dealing with immigration reform continues to put America in a very dangerous situation. We have illegals crossing our southern border, northern border every hour, every day.
Reports last week, for example, focused on various international terrorist groups starting to talk with groups south of the United States about getting some terrorists into this country.
It undermines our economic growth in this country by essentially supporting a black market in the economy. It deals directly with security and economics and our geopolitical relationships around the world, especially with our two closest friends and allies and neighbors, Canada and Mexico. So I'd say that's pretty urgent.
PILGRIM: I would say so. How much do you not sleep at night thinking about our porous borders and the security risks for terrorists coming through?
HAGEL: Well, Kitty, that is certainly one of the more urgent dynamics of this. And the fact is it is happening. And I know that we are focused on it. I know especially the last three years, homeland security and State Department, and the states that represent -- are represented along that border are all dealing with it. But we've got to do far more. And we can't just put Band-aids on it, talking about driver's licenses. Those are just symptoms of a bigger problem. We've got to get into a very core discussion and action on reforming our entire immigration process.
Another dynamic of this is pushing back the good people that want to come to this country, Kitty, the good people who are in this country now, just like your forefathers and mine came to this country for the right reasons. And we want to encourage those immigrants into this country. They're the very fabric and soul of our country.
But there are some bad ones. We've got 10 to 12 million immigrants here illegally. We don't even know where they are. We don't know who they are. We need to start getting some sense of that to begin with, so we can concentrate on the problem areas and the problem people.
PILGRIM: How does your proposal, Senator, differ from President Bush's guest worker plan?
HAGEL: Well, mine's a comprehensive immigration reform plan, Kitty. What the president is talking about is, in general terms, with principles.
I support his efforts. I support his leadership. I support his -- his courage. But he has not come up to Capitol Hill -- he may in this Congress, but he didn't in the last Congress -- with an actual proposal. He's not really proposed anything in the terms -- in terms of legislation.
And what I would do, I would take it much deeper and wider. In my Bill that I had introduced last year -- we'll introduce again this year -- in terms of real reform across the board. Not just worker visas, but let's try to focus on the 10 to 12 million illegals who are here now, start cataloging them. Where are they? Let's get them into a cycle, into a queue.
If they want to stay and be part of our society, let's find them. That's not amnesty. We're talking about six basic things. We're talking about criminal records. Have they paid their taxes? Have they been here five years? They're going to have to pay a $1,000 fine. Will somebody vouch for them? Are they working now? This is not amnesty.
But yet the good ones, and most of the people here are here for the right reasons, for hope, a better future for themselves, but mainly their families. And they're productive. They're something that's very -- these immigrants, they're very important to our country.
Let's find them. Let's get them into a queue of legality so they can start working toward eventual citizenship or whatever they want, so we can take our resources and focus on the ones who are here to do harm to our country and put a new focus on our border security.
PILGRIM: Not amnesty, Senator, but certainly accountability. Thanks very much for explaining it to us.
HAGEL: Thank you.
PILGRIM: Senator Chuck Hagel.
HAGEL: Thank you.
PILGRIM: Well, we conclude our series of special reports we call "The Assault on the Middle Class."
Tonight we look at the fading job security in this country as outsourcing and corporate consolidation replace loyalty in the workplace.
Christine Romans reports.
(BEGIN VIDEOTAPE)
CHRISTINE ROMANS, CNN CORRESPONDENT (voice-over): Gone, the same commute to the same office or factory over and over for 30 years. Gone, retirement at 60 or 65 and a solid pension. Today's worker has remarkably less job security and more anxiety.
KATE WENDLETON, THE FIVE O'CLOCK CLUB: It's just very nerve- wracking if you find that you went to a company, thought you were going to stay at a company four, five, six years, and then you get downsized again. That is pretty wrenching.
ROMANS: Wrenching and common. Workers today can expect more than 10 jobs in their first 20 years in the labor market. They'll pay more out of their own pocket for healthcare, and some of those workers will take on a second job. More than five percent of the American workforce holds down two jobs. That's nearly eight million people.
Workers used to have a contract with their employer: 40 hours a week and benefits in exchange for nearly lifetime employment. That contract has expired.
JOHN CHALLENGER, CEO, CHALLENGER, GRAY & CHRISTMAS: Companies used to ride with their people through their down times, waiting for the better times when they really needed them.
ROMANS: Today companies need mergers and routinely fire thousands of employees at a time.
CHALLENGER: Companies treat their people as just in time. They shift their work force levels up and down.
ROMANS: And sometimes shift their work force overseas. Today's workers compete with millions of manufacturing workers in China and technology workers in India and Eastern Europe.
According to the Economic Policy Institute, a swelling trade deficit with China has destroyed 1.5 million American factory jobs.
DONALD LOWMAN, TOWERS PERRIN: We had a lot of job reductions, job relocations overseas as companies outsource, then look for ways to do things more economically. And so I think it's obviously raised a lot of questions in employees' minds about what can they really count on?
ROMANS: A generation ago you could count on most households having one earner, and that earner was a man. Today, men and women are scrambling in the same competitive jobs market.
(END VIDEOTAPE)
ROMANS: And studies show men worry about job security more than women do, possibly, Kitty, because women never enjoyed that lifelong employment contract.
PILGRIM: Thanks very much. Christine Romans.
Still to come, the push for Middle East peace: what Palestinians are doing to stop other Palestinians from attacking Israelis. Former Prime Minister Benjamin Netanyahu joins me next.
And then "Heroes," how this soldier led his unit to safety after its leadership failed. Our special report is next.
(COMMERCIAL BREAK)
PILGRIM: Two thousand Palestinian security forces deployed across the northern Gaza Strip today in an effort to prevent attacks on Israeli communities. Newly elected Palestinian President Mahmoud Abbas is negotiating with leaders of radical Islamist terrorist organizations for a cease-fire. Militant leaders, however, say they will only halt attacks if Israel stops military operations.
Well, joining me now is former Israeli prime minister and current finance minister, Benjamin Netanyahu.
And thank you for joining me, sir.
BENJAMIN NETANYAHU, FORMER ISRAELI PRIME MINISTER: Good to be with you.
PILGRIM: What do you think of the latest development, about Palestinian units deployed at very critical checkpoints? What's your your assessment?
NETANYAHU: We'll see. We had a cabinet meeting a few days ago in Jerusalem, in which we said let's give the new leadership a chance to show that they're different from the old leadership of Arafat.
And the quickest way to find out is if they actually take concrete action to stop Hamas and the other terrorist groups from firing rockets into our cities and killing our children.
If they do it, we'll applaud and continue with negotiations with them. If they don't do it, well, we'll do what any government has to do and take action to stop this rocketing. PILGRIM: As you say, a very new administration, and Prime Minister Ariel Sharon broke off talks and now has sent conciliatory greetings for the Muslim holiday. A little it stop and start. Do you think that's the way it will be or do you hope for better?
NETANYAHU: These are not political negotiations. We had negotiations with the -- our military people with their security people, with the hope of seeing some responsible action, which means to actually begin to prevent terrorist actions and rocketing of civilians and eventually to dismantle these terrorist organizations.
I think that's the minimal requirement that we and the international community expect of the Palestinian leadership.
You say it's a new leadership. It's not quite a new leadership. These are Arafat's old crowd. And they really have to break with Arafat's legacy. Otherwise it's like installing in Iraq Saddam's deputy, or in Afghanistan, the Taliban deputy.
Clearly, you want to see a break. It's not so much personalities. It's not so much the identity of the individual as the policy pursued by this leadership. They have to fight terror. That's the only way we'll have peace.
PILGRIMS: There have been very hopeful signals, however, running on an antiviolence platform, meeting with Islamic leaders, Jihadist leaders saying -- calling for a ceasefire. These are very, very positive signs. Do you think Mahmoud Abbas will have the will, the strength and the control to actually execute these promises?
NETANYAHU: You put your finger on it, Kitty. It's the question of does he have the will? Frankly, does he have the guts?
I'd say that if he -- if he shirks from this, and he may well shirk from it, then he will fail. He may fail and live to see his failure, and if he tests it, there's a personal risk involved, but that's what leadership is. It always means taking on personal risk.
That's what leaders do. Otherwise you don't need to be a leader. We don't need you if you don't take risks.
PILGRIM: One of the -- one of the big variables is the timetable for withdrawing of Jewish settlements. Do you think that this will follow the agreed-upon timetable? Will there be difficulty with this? Or do you think is doable in the coming year?
NETANYAHU: I think it's doable. I frankly prefer to have it done with the plebiscite in Israel to mitigate the pressures that are building up there.
But a lot of it, I think, will depend on the security situation. And if -- the prime minister has said that if we have terror, then that's going to change his plans.
I think it's in everyone's interest to see that this terror stops and, in fact, the mechanisms of terrorists, the instruments of terror, are dismantled.
And that will be the real -- the first real test of the Palestinian leadership. That's how it will show that it's a new leadership, not merely in the technical sense, but in the practical and profound sense that we all expect.
PILGRIM: Let me call upon your expertise as finance minister. This entire process of withdrawing of settlements will involve money. It will involve a lot of resources. How do you assess that, the ability to do that going forward?
NETANYAHU: Well, we've budgeted it. And the Israeli economy is doing significantly better than most economies. The GDP grew at 4.2 percent this year after shrinking just less than two years ago. So we're in very rapid growth. Our stock market has nearly doubled in about 20 months, actually more than doubled.
And the whole economic situation is such that we can -- we can finance this. If we need a little help from our friends, we won't be shy to ask, but so far I think we're holding our own.
And what is happening in Israel is that we're conducting very rapid, very broad free market reforms. S&P just upgraded us.
I don't think people are looking now at Israel as a geopolitical risk or a security risk. Terror in general has declined by 95 percent. They're looking and they're asking, will the reformist policies continue? And I can tell you as long as I have anything to do with it, they will. I think Israel is a very good investment.
PILGRIM: Certainly, a hopeful moment. And thanks very much for joining us tonight...
NETANYAHU: Thank you.
PILGRIM: ... to talk to us about it. Benjamin Netanyahu, thank you, sir.
NETANYAHU: Good to be with you.
PILGRIM: In "Heroes" tonight, a young soldier who took control in the midst of chaos. Sgt. Cesar Desantiago was awarded one of the military's highest honors for courage under fire.
Casey Wian has his story.
(BEGIN VIDEOTAPE)
CASEY WIAN, CNN CORRESPONDENT: At Fort Campbell, Kentucky, the 101st Airborne's famed Rakkasans have returned from a training mission. They're one tour of duty in Iraq. Now they prepare for a second.
For Sgt. Cesar Desantiago, the scene is bittersweet. He didn't go with his fellow soldiers this time, because he's just days away from leaving the Army. SGT. CESAR DESANTIAGO, 101ST AIRBORNE: I've got to leave the Army, because I got married and I've got a baby on the way. And I want to be here for my baby.
WIAN: Desantiago is just 21-year-old, but already he's a decorated soldier. Courage and bravery under fire earned him a Bronze Star.
On April 8, 2003, in a fierce battle to control the city of Ar- Hallah (ph), Desantiago took over when his leader froze in fear. With bullets flying and three of his buddies injured, Desantiago led his fellow soldiers as they stormed a building.
DESANTIAGO: I was going to be point man, and I was going to be the first man in the door. And I was pretty nervous at that point.
I got the order to launch two grenades into a window on the second floor, so I did. And they went right in through the building, so that eliminated all the threat.
I was the first man in every door down in that main building where we were taking fire from. And I successfully got out my whole team.
WIAN: Desantiago survived many more encounters with the enemy before returning home a year ago. The Bronze Star surprised him.
DESANTIAGO: I thought, "Whoa, I didn't expect so much." I mean, I felt like I did what came to my mind at that time. I didn't think it was so big.
WIAN: Desantiago plans to go to college and has applied to be a policeman in Hopkinsville, Kentucky.
Casey Wian, CNN, reporting.
(END VIDEOTAPE)
PILGRIM: Elections in Iraq, why increasing violence could put the country's first Democratic elections in jeopardy. I'll discuss that and much more with four of the nation's top journalists.
Stay with us.
(COMMERCIAL BREAK)
PILGRIM: Joining me now from Washington are four of this country's top journalists: Ron Brownstein of "The Los Angeles Times"; Karen Tumulty of "TIME" magazine; Roger Simon, "U.S. News & World Report." And joining me here in New York is Steve Shepard of "BusinessWeek." And thank you all for being with me.
Steve, I'll start with you, since you're sitting right next to me.
Let's -- let's actually play to your expertise, the stock market. First time in 20 years it's been down for the first three weeks of the year. Should we start to worry or what?
STEVE SHEPARD, "BUSINESSWEEK": I think it's telling us a little bit more about what happened in 2004. Since Bush was reelected, we had a very strong rally, and it probably was a bit excessive. And so I think the market is backtracking.
You know, everybody says if it's down in January it's going to be down for the year and all that stuff. I mean, that's like, you know, hemlines and all these other indicators that don't mean anything.
So yes, we're off to a decline and probably a slow start, and there's some reasons for concern. But it's way too early to head for the hills.
PILGRIM: So don't believe all that witchcraft they come up with?
SHEPARD: I don't think so.
PILGRIM: OK. Well, let's do a segue into an important issue that's facing this country, and that's the privatization of Social Security, which is, of course, linked to markets. And let me draw in the rest of my panel.
One of the plans is for private accounts. Private accounts would presumably have some access to stock-based instruments. Let's start with Ron.
Ron, what do you think of the president's proposal?
RON BROWNSTEIN, "LOS ANGELES TIMES": Well, we're still waiting for the specifics, of course, on it. But there is a surprising amount of preliminary skirmishing that is suggesting it's going to be a very complex battlefield in both the House and the Senate.
The chairman of the House Ways and Means Committee the other day, Bill Thomas, who is a very independent, sometime ornery operator in Washington, gave some very complex and sort of Delphic comments that left the impression he did not believe the president's plan, as it's been floated, was really politically viable, that he might be moving in very different directions.
You have different camps in both parties, Kitty. You have Democrats who believe that they need to do nothing but oppose it. Others who think they have to come up with an alternative solution.
You have Republicans who want to go for the individual accounts but not long-term benefit cuts. Others are somewhat in the reverse. And some who feel that they're better not off not touching this at all.
So pulling this together is going to be quite a challenge; a lot of people moving in different directions at this point.
PILGRIM: Take quite a bit of political capital. Roger?
ROGER SIMON, "U.S. NEWS & WORLD REPORT": You know, you hate to say something is dead in the water before it's even gotten in the water, but at this point it's really hard to see how George Bush -- how George Bush puts together a winning coalition to vote for this bill. We haven't even seen the bill yet.
I mean, we've got the general outlines of the plan, which is to create an atmosphere of crisis, to convince the American people there is a crisis in Social Security, and then to threaten higher taxes unless we reform Social Security, and basically use the same tactics that he used during the campaign to gain reelection.
The trouble is too many members of his own party aren't buying this. And it's hard to see how he puts together enough Republican and Democratic votes to do this at all.
PILGRIM: I just wanted to add, nevertheless on this program we've examined the sort of resources that are left to older Americans at this point, and they are going to dwindle over the decades. Karen?
KAREN TUMULTY, "TIME" MAGAZINE: Well, I was just going to say along those lines, the resistance from his own party, the one part of Chairman Thomas' comment that was not Delphic was his description of this plan as a dead horse, which for anyone who's seen "The Godfather, Part I," the imagery is -- is hard to miss on what Congress thinks at this point.
BROWNSTEIN: But it wasn't clear if he was talking, though, about the concept of Social Security reform itself or the individual accounts. He was very critical at points on Medicare reform and helped steer that through.
The one thing the president -- there are a couple things the president has going for him in this. One is that, over the long term, people feel something has to be done. Now, whether it's his solution or not is another question.
The other thing is the concept of allowing people more control over their retirement and investment is popular to an extent. Now, whether that means undermining or reducing the guaranteed benefits that Social Security provide, again, is another questions.
But he is swimming with something of a current in public opinion that does want -- we've seen over the past generation with people involved in 401(k)s and so forth, we have more investors and people more comfortable with that to some extent.
SIMON: It depends on what poll you look at. The latest "New York Times" poll showed that 60 percent of those responding would not put their money in private accounts. And 50 percent, or a majority, said that George Bush was more concerned with Wall Street than he was with the average American when he's talking about this.
So I don't sense any huge groundswell out there to privatize Social Security or a portion of Social Security.
SHEPARD: Particularly among...
PILGRIM: Let's get Steven in on this. Yes.
SHEPARD: Particularly among the people who need it most. The lower-income people who don't participate in 401(k)'s are not likely to takes voluntary accounts in Social Security, either. So the plan won't help the people who need it most.
TUMULTY: You know what?
PILGRIM: Guys, let's just move on to really a review of what happened yesterday, which I thought was riveting, the inaugural speech. And there's been a good bit of debate today about whether it was a patriotic speech or a combative speech. What are the reviews? Let's start with Steve.
SHEPARD: Well, I mean, it was positively Wilsonian, and you know, make the world safe for democracy. It was essentially a foreign policy speech.
I'm struck by the hints in there about what he was saying about domestic policy, including Social Security. You know, liberty around the world means sort of an end to collective action in the United States. Individual responsibility is what we want, which equals the ownership society, which he calls private accounts in Social Security.
I think there were real hints of linking liberty around the world to individual liberty at the home.
PILGRIM: So you cut to the bottom line and it was domestic?
SHEPARD: I saw it in there a little bit.
PILGRIM: Yes. OK. Go ahead, Karen. Iran.
TUMULTY: I think the real question, however, is -- overseas where this goes next? Because this comes on, you know, the same day that Vice President Cheney gets on the Imus radio show and suggests that he wouldn't be surprised if Israel takes after Iran.
So the president...
PILGRIM: What?
TUMULTY: And we are going to stand up for people around the world, oppressed people, who want us to stand up for them. So the question is, so where do we go next? Is it China? Is it Uzbekistan? Where -- how far in a war-weary country are we ready to take this division?
BROWNSTEIN: Right. There is -- there is a century-long history, Kitty, of presidents giving sweeping declarations of fealty to democracy. The real issue is what price are they willing to pay to hold that commitment? And will American -- will American society support them as they do it?
Pay any price, bear any burden was very stirring, as well, in 1961, but we didn't really want to cash that check in Vietnam when it came a decade later. And that's the real question, ultimately, the impact this will have.
PILGRIM: Well, gentlemen and ladies, we have to end it right there. That's the last word, I'm sorry to say, but to be discussed, I'm sure, over dinner. Roger Simon, Roger Brownstein, Karen Tumulty, and Steve Shepard, thanks very much for joining me.
Still ahead, the results of tonight's poll, a preview of what's ahead on Monday.
(COMMERCIAL BREAK)
PILGRIM: Now the results of tonight's poll. Ninety-three percent of you believe outsourcing maintenance on U.S. airplanes to foreign countries poses a risk to air travel. Seven percent do not.
Well, thanks for being with us tonight. Please join us on Monday. The author of a new book called "The United States of Europe" says the European Union is determined to be the next superpower. He will join us.
And our special report, "Broken Borders," how states are cracking down on illegal aliens.
For all of us here, have a great weekend. Good night from New York. "CNN SPECIAL REPORT: IRAQI ELECTIONS" is next.
TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com
Aired January 21, 2005 - 18:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
(BEGIN VIDEOTAPE)
KITTY PILGRIM, HOST (voice-over): Tonight, insurgents explode a huge car bomb near a mosque in Baghdad. Factional violence is escalating. Is Iraq on the brink of civil war?
JOHN NEGROPONTE, U.S. AMBASSADOR TO IRAQ: We're doing everything we can to ensure that security conditions permit people to vote.
PILGRIM: "The Bush Doctrine:" President Bush declares he'll spread democracy around the world. Tonight, why this country's closest ally is no longer giving the United States its unequivocal support.
Exporting safety? Some of our biggest airlines outsource vital maintenance work to cheap overseas labor markets. We'll tell you why you should be concerned.
UNIDENTIFIED MALE: When we go overseas, we find that there is no security background check being done on these individuals.
PILGRIM: And deep freeze. A huge snowstorm will bring chaos to many parts of this country this weekend. Tonight, where the storm is headed and when it will strike.
(END VIDEOTAPE)
ANNOUNCER: This is LOU DOBBS TONIGHT for Friday, January 21. Here now for an hour of news, debate and opinion, sitting in for Lou Dobbs, Kitty Pilgrim.
PILGRIM: Good evening.
Tonight there are fears Iraq is on the brink of a civil war. That could make it much harder for the United States to achieve its goals.
Terrorists today blasted worshippers near a mosque in Baghdad, killing at least 14 people. The attack was the latest assault on the majority Shiite community. It comes just nine days before Iraq's election.
Jeff Koinange reports from Baghdad.
(BEGIN VIDEOTAPE) JEFF KOINANGE, CNN CORRESPONDENT (voice-over): More than a dozen lives were destroyed by a car bomb just after Friday morning prayers at this Shia mosque on the southern edge of Baghdad.
And a little further south, a celebration turned tragic when an ambulance drove into a wedding party and exploded. Several people, including the suicide bomber, were killed, and a large number of guests were wounded.
And in the town of Heet in the volatile Sunni Triangle, insurgents attacked a police station, using rocket-propelled grenades and machine guns. They ransacked the station, took the weapons, blew up the building, escaping in two police cars.
And a follow-up videotape has been released by the group calling itself the Islamic Resistance Moment, the group that says it kidnapped eight Chinese hostages several days ago.
A voice on the tape demands the Chinese government forbid its citizens from entering Iraq, adding this would be considered a positive gesture in granting mercy on the hostages.
The U.S.'s highest-ranking diplomat in Iraq says the landmark elections will prove a turning point for the country.
NEGROPONTE: I think this election is a very, very important milestone towards the establishment of an enduring democracy here and a system of government whereby Iraqis will be able to settle their differences through peaceful, political means.
KOINANGE: Salad Hadin Mekbi (ph), a government engineer, agrees and voices the feelings of a terrified community.
UNIDENTIFIED MALE (through translator): We hope that these elections will bring a better future for the Iraqi people. I have high hopes for the future to get better and better.
KOINANGE (on camera): Just how soon things can get better is anyone's guess. Right now Iraqis are just hoping to get through a day without violence, something that seems less and less likely as the election day draws near.
Jeff Koinange, CNN, Baghdad.
(END VIDEOTAPE)
PILGRIM: The Pentagon has approved a huge incentive plan to stem the flow of Special Forces troops out of the military.
Military officials are increasingly concerned about the rising number of experienced Navy SEALs, Army Green Berets, and other troops who are quitting at the end of their enlistments. Many of those troops are joining private contractors who pay much higher salaries.
The Pentagon says the incentive package is worth $168 million over three years. The Iraqi elections are the first big test of the new Bush doctrine of spreading freedom around the world. The president made liberty the centerpiece of his inauguration speech yesterday, but the president is not saying how far he will go to spread democracy.
White House correspondent Suzanne Malveaux reports -- Suzanne.
SUZANNE MALVEAUX, CNN CORRESPONDENT: Well, Kitty, as a matter of fact, today we saw the end, the final end of the pomp and circumstance for the ceremonies for the inauguration for the president.
Of course, the focus changing now, this to the president's agenda, the statement he made in his inaugural address yesterday, talking about the focus to bring democracy and freedom around the world. Let's take a listen.
(BEGIN VIDEO CLIP)
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: Today, America speaks anew to the peoples of the world. All who live in tyranny and hopelessness can know the United States will not ignore your oppression or excuse your oppressors. When you stand for your liberty, we will stand with you.
(END VIDEO CLIP)
MALVEAUX: Now, Kitty, there are some Bush critics as well as political observers who say they believe this could send a message to nuclear powers like North Korea or Iran, some sort of potential threat.
Some senior administration officials say he does not necessarily see it that way, but clearly, the Bush administration is going to be faced with a delicate balancing act, on the one hand, rewarding those allies in the war on terror, at the same time, of course, holding some of them accountable for those human rights and democratic reforms.
The president faces his first big test when it comes to how persuasive he will be in bringing forward that message of democracy. That is when next month he meets with the Russian president, Vladimir Putin, to push forward in what some of those things they see perhaps as anti-democratic steps that Russia has taken over the last couple months -- Kitty.
PILGRIM: Thank you very much, Suzanne Malveaux.
Well, there's been a cool reaction in Europe to President Bush's inauguration address. That's not surprising, because President Bush faces opposition in countries such as France and Germany.
More troubling is the fact there's rising concern about the president's policies in Britain, our closest ally.
Robin Oakley reports from London.
(BEGIN VIDEOTAPE) ROBIN OAKLEY, CNN CORRESPONDENT (voice-over): President Bush may have wowed Washington by pledging to take on tyrannies across the world, but the media in Britain reflected a different mood.
"The Guardian" called it the most combative inauguration speech in 50 years. To "The Daily Mirror," it was "messianic" and "warlike."
And with Washington highlighting Iran's nuclear arms ambitions, the same note of alarm was sounded by a former member of Tony Blair's cabinet.
ROBIN COOK, FORMER U.K. FOREIGN SECRETARY: This is no time to start imposing liberty from 38,000 feet through a bomb thrown in another country.
OAKLEY: Mr. Blair, soon to face his electors, has lost support by backing the war in Iraq. He offered no comment on the speech. And analysts note he hasn't rushed to endorse Condoleezza Rice's new list of the six outposts of tyranny: Iran, North Korea, Burma, Cuba, Belarus, and Zimbabwe.
PETER KELLNER, POLLSTER: I can see no circumstances whatsoever in the next few years in which it would be politically possible for a British government of any political character to support another military action by the United States.
OAKLEY: Since Blair's opinion poll rating drops every time he's seen with him, Mr. Bush shouldn't expect an invitation to Britain before this year's general election.
On Iraq, the two are bound together. But analysts say that on other issues, Mr. Blair will be quite happy now to emphasize his detachment.
On Iran, Britain's backing France and Germany on maintaining a dialogue, not a confrontation. And Mr. Blair says he's ready, like the rest of the European Union, to defy Washington by ending the embargo on arms sales to China.
JACK STRAW, U.K. FOREIGN SECRETARY: There is an issue of consistency here, because there are embargoes on China, Zimbabwe and Burma. There's not an embargo, for example, in respect to North Korea, which has a terrible human rights record.
OAKLEY (on camera): Elections shape political tactics. Mr. Bush has won his contest. Now for Mr. Blair, there's clearly a benefit in stepping gently away from White House rhetoric, at least for awhile.
Robin Oakley, CNN, London.
(END VIDEOTAPE)
PILGRIM: On Capitol Hill, Democrats are defiant as President Bush pushes sweeping domestic reforms. Democratic lawmakers are promising a tough fight against what they call Republican, quote, "extreme policies," unquote. Congressional correspondent Joe Johns has our report.
(BEGIN VIDEOTAPE)
JOE JOHNS, CNN CORRESPONDENT (voice-over): Despite the drumming they took in the last election, there is plenty of fight left in congressional Democrats.
SEN. HARRY REID (D-NV), MINORITY LEADER: We will work with the president, but I do say this, that we're not going to shy away from living up to the values and priorities that we believe are important in our country today.
JOHNS: Standing their ground early in the new Congress on issues that seem all but settled, some top Democrats on the Senate Judiciary Committee, including Senator Edward Kennedy, are pressing Alberto Gonzales, the president's pick for attorney general, to answer more written questions about his views on the law, because they see some of his answers to earlier questions as unsatisfactory and evasive.
Some other Democrats, including senators Barbara Boxer and Robert Byrd, slowed down the confirmation vote of Condoleezza Rice for secretary of state because they wanted more time for debate.
The administration is not happy.
ANDREW CARD, WHITE HOUSE CHIEF OF STAFF: We all know that Dr. Rice will be a great secretary of state. And she should move into that position quickly, and I wish the Senate would confirm her. But you know, petty politics is playing a role in this, and that's unfortunate.
JOHNS: Democrats also forced a debate on election reform by holding up the counting of Ohio's electoral votes, delaying the certification of President Bush's election for a couple of hours.
So what's the point? With diminished power, Democrats say they'll use congressional procedures where they can to highlight Social Security and five other issues.
REP. NANCY PELOSI (D), MINORITY LEADER: Health, education, jobs, clean environment, strong national defense, with accountability in terms of spending.
JOHNS: But with battles over the judiciary ahead in the Senate and even a possible Supreme Court nomination, some Democrats say it's a risky strategy to complain too much.
WILL MARSHALL, DEMOCRATIC LEADERSHIP COUNCIL: You have to pick your fights carefully. Democrats shouldn't go after every single judge nomination, and they don't.
JOHNS: And a former Democratic senator who just left Capitol Hill is urging his ex-colleagues not to get off on the wrong foot.
JOHN BREAUX (D-LA), FORMER SENATOR: Try to find ways to work together because, if we don't, there will be nothing that will be done in the Congress. It will be total stalemate, and, in that case, everybody loses. Both parties lose.
(END VIDEOTAPE)
JOHNS: For their part, Congressional Republicans say they will not allow the feistiness of the Democrats to get out of hand. For starters, Republicans say, they plan a spirited defense of Condoleezza Rice when the nomination comes up next week -- Kitty.
PILGRIM: All right. Thanks a lot.
Joe Johns.
New developments tonight in the escalating United Nations oil- for-food scandal. Now it follows reports that former President Jimmy Carter and former vice-presidential candidate Jack Kemp met an Iraqi- American businessman involved in the scandal.
Senior United Nations Correspondent Richard Roth is here with the report -- Richard.
RICHARD ROTH, CNN SENIOR UNITED NATIONS CORRESPONDENT: Kitty, developments, though we don't know if it really means anything at this point or will amount to anything.
The leader of one U.N. oil -- the U.N. oil-for-food investigation, Paul Volcker, has said oil for food is complicated. If you peel away one level, you find something else. Not surprisingly, you're going to see the names of public figures come up as several oil-for-food probes continue, especially when a defendant decides to cooperate.
This week, we saw the first person to plead guilty in the oil- for-food case, Samir Vincent, an Iraq-American businessman who bought oil from Iraq and resold it at a great profit. Baghdad also gave him hundreds of thousands of dollars to lobby to get sanctions lifted on his country.
Vincent was convicted among other things of failing to register as an agent of a foreign government. Since the Justice Department says Vincent tried to lobby former Clinton and Bush administration officials on behalf of Saddam Hussein, it was only a matter of time since a name or two was disclosed.
However, there's absolutely no indication whatsoever that the people who met with Vincent did anything improper.
Former Republican vice-presidential candidate Jack Kemp confirms to CNN he answered questions about Vincent from the FBI several months ago. He said he cooperated fully and that they had no further questions. Kemp told CNN he met with Vincent after the Iraqi-American called after reading a column Kemp wrote on the Middle East on economic development.
At one point, Kemp put Vincent's name on a planned committee to establish a Marshall Plan in Iraq after the fall of Saddam. He was one of two dozen people on that list, but the committee never got started.
Kemp says he never advocated with the Bush administration a program for sanctions to be lifted. First, Kemp said, there needed to be full access for weapons inspectors.
Kemp says his ideas on Iraq were rebuffed by the Bush administration.
Former President Jimmy Carter also crossed paths with Samir Vincent. He was present when Carter met with Iraqi clerics in early 1999 to hear their views on the plight of children in Iraq and the impact of U.S. sanctions.
Jimmy Carter has not been interviewed by the FBI and says he did not lobby the Bush administration to get sanctions lifted.
Another Washington figure, former Defense Secretary Frank Carlucci, reportedly gave a good reference on Vincent to Kemp. Carlucci and his firm, The Carlisle Group, deny doing any business with Vincent or his company, Phoenix International.
Another name on Kemp's proposed committee, former U.N. Ambassador Richard Holbrooke. He says he never heard of or met Vincent -- Kitty.
PILGRIM: Richard, this is a lot of detail, and, as you say, you peel off layer after layer, you keep getting down. When is the final Volcker report going to be released?
ROTH: The Volcker interim report originally scheduled, we told you here on Monday, for the 31st of January now highly likely February 7, and that's just an interim report. It's going to be months away for his report, and you can expect this year to be filled with congressional reports and maybe even a congressional leak or two.
PILGRIM: And lots more detail.
Thanks very much.
Richard Roth.
Well, still to come, "Deep Freeze." A massive winter storm sweeping across the country, and, tonight, we'll tell you when and where the storm will strike.
And "Power Play." How an old-fashioned Latin American strongman believes he can threaten the United States, our oil supplies and get away with it.
(COMMERCIAL BREAK)
PILGRIM: An arctic blast is driving temperatures down to the single digits across large parts of the country tonight.
North Carolina -- residents were greeted with another snowfall this morning, and the snow has wreaked havoc on roads in Raleigh, and over a thousand road accidents were reported. None, however, fatal.
And now residents in the Northeast and the Midwest are bracing for the first major snowstorm of the season. Now this is a live picture from our affiliate KARE in Minneapolis, Minnesota, where the snow is already making driving pretty dangerous.
Rob Marciano is at the CNN Weather Center and has the latest on the snowstorm. -- Rob.
ROB MARCIANO, CNN METEOROLOGIST: Hi, Kitty.
Snowing heavily at last observation in Minneapolis, as you saw, and they've already seen three to five inches of snow already. More on the way.
And this thing is steadily marching toward Chicago along a very strong and strengthening jetstream that will eventually pick up some moisture as well.
Out of the Dakotas this thing has come, and into the Minnesota area where, as mentioned, three to five inches of snow have already fallen, and they're in the thick of it right now.
This moisture stream will continue to pour eastward, engulfing the Chicago area later on tonight where winter storm warnings are posted for 10-plus inches of snow there, and then that moisture coupled with the Gulf of Mexico moisture and eventually some Atlantic moisture is going to run into some extremely cold air.
Bitterly cold air expected tonight. Again, 12 in New York, 18 in D.C., 18 in Chicago. So, certainly, cold enough for snow pretty much everywhere north of the Mason Dixon line.
So we do have a weekend of heavy snow potential that is pretty high. Look at these snow tallies as this thing marches off to the East -- again, 8-plus, probably 10-plus in Chicago -- picks up some moisture, slams it across the western slopes of the Appalachians, maybe a foot or more there, then taps the moisture from the Atlantic Ocean, the gulf stream there, a little bit warmer. Sometimes these things get cranking a little bit more from that.
So Saturday night into Sunday morning is when we expect the heaviest snow to begin from, say, Baltimore up through Philadelphia, up I-95 towards New York, and now we've stretched this 12-inch plus line a little bit farther north.
And the National Weather Service has issued a blizzard warning effective tomorrow through Sunday morning for the New York City area and through much of Long Island with winds gusting at 35 miles an hour there, low visibility, and biting cold temperatures.
This snow will stick around. Temperatures easily below freezing from D.C. up through Boston tomorrow. That's the latest from here. We'll keep you updated throughout the weekend.
Kitty, back to you. PILGRIM: Well, we know it's coming at us. Thanks very much.
Rob Marciano.
Thanks, Rob.
Well, those cold temperatures have sparked the biggest rise in fuel demand in the past 14 years. Oil prices today came close to $50 a barrel. The spike in demand causes the United States to be more and more dependent on foreign oil.
Now Secretary of State nominee Condoleezza Rice took on one of main countries supplies those imports during her confirmation hearings.
(BEGIN VIDEO CLIP)
PILGRIM (voice-over): Condoleezza Rice surprised many by underlining troubled relations with Venezuela during her confirmation hearing.
CONDOLEEZZA RICE, SECRETARY OF STATE NOMINEE: It's extremely unfortunate that the Chavez government has not been constructive, and we do have to be vigilant and to demonstrate that we know the difficulties that that government is causing for its neighbors.
PILGRIM: The problem is Venezuela supplies some 13 percent of oil, and it's the fourth largest supplier for U.S. oil.
Last year, in a fiery speech, Chavez threatened to cut off oil exports to the United States, and, in the current international climate with the war in the Middle East, that is a worry.
CAROL GRAHAM, BROOKINGS INSTITUTION: Particularly given that we've got lots of other problems with oil-producing countries elsewhere on the globe, no, we need Venezuela's oil. It's been -- it's always been sort of a touchy relationship because of that. It's very difficult to completely pick a fight with Venezuela.
PILGRIM: Chavez has gone out of his way to antagonize the United States, befriending Saddam Hussein and Cuba's Fidel Castro. He routinely indulges in long tirades against the United States.
Regional experts point out Chavez may talk tough, but Venezuela also needs the U.S. market.
PETER MAXIM, INTER-AMERICAN DIALOGUE: It's a mutual dependence. Venezuela sends its oil to the United States. The refineries for the kind of oil Venezuela produces are found only in the United States. So Venezuela doesn't -- can't just from one day to the next ship its oil to other markets.
PILGRIM: The relationship between Chavez and the United States turned bitter during a 2002 coupe when Chavez accused the United States of backing opposition leaders to oust him. He regained power within two days, but the incident poisoned the relationship. (END VIDEOTAPE)
PILGRIM: Now most regional experts say Condoleezza Rice was correct to point out how disruptive Chavez is to the region and say Chavez' continuing role as a force against democracy will likely increase during the second term.
Still ahead, how some major airlines may be compromising our safety and security just to save a buck. We'll have a special report.
And the senator who calls the need for immigration reform the most urgent problem facing this country. He'll join us.
(COMMERCIAL BREAK)
PILGRIM: In "Exporting America" tonight, some of this country's largest airlines are exporting critical maintenance work to cheaper foreign labor markets. Now critics say it poses a threat not only to American jobs, but to our national security as well.
Lisa Sylvester reports from Washington.
(BEGIN VIDEOTAPE)
LISA SYLVESTER, CNN CORRESPONDENT (voice-over): You might have never heard of Taca airlines, El Salvador's official airline, but you may have flown on a plane that was overhauled by their mechanics.
U.S. carriers, including JetBlue, are increasingly farming out heavy maintenance work overseas. JetBlue sends its airlines to El Salvador and Canada for major maintenance overhauls every 15 months.
America West Airlines also sends some of its planes to El Salvador for maintenance; Northwest Airlines, to Singapore and Hong Kong.
American Airlines does the least amount of maintenance outsourcing, but even their mechanics have noticed problems.
DANNY GONZALES, AMERICAN AIRLINES MACHINIST: Some of that stuff is outsourced, and we get it back, and we have to redo it. And I keep telling management here, is that you're wasting more money, more time.
SYLVESTER: Since 1988, the number of foreign repair stations doing work for U.S. carriers has increased 325 percent, according to the AFL-CIO transportation and trades department. At the same time, thousands of American maintenance jobs have been lost.
The foreign repair shops have to be certified by the Federal Aviation Administration, and supervisors have to be licensed by the FAA, but the individual mechanics working on the plane do not have to be FAA-licensed. JetBlue defends the use of foreign maintenance workers.
DAVE RAMAGE, VICE PRESIDENT, JETBLUE: There's almost an inference that if you go outside the borders of the States that you're getting a lower-quality work, and, quite frankly, that is so far from the truth that it's amazing that people would think that because these companies are required to perform for the same standards as everybody else.
SYLVESTER: Critics are concerned not only about the thousands of American jobs lost and safety concerns, but also the risk to national security. U.S. airline mechanics have to pass an FBI background check, but the FAA does not require foreign workers to submit to a similar background test.
MARK TAYLOR, AIRCRAFT MECHANICS FRATERNAL ASSOCIATION: Now, when we go overseas, we find that there is no background check being done on these individuals, and they're performing the same exact work that we do inside the United States.
(END VIDEOTAPE)
SYLVESTER: The FAA would not make anyone available for an interview today, but the agency says it has improved its oversight of maintenance outsourcing. It requires air carriers to submit a list of the foreign repair shops, and FAA inspectors do perform on-site visits to make sure the shops are following U.S. maintenance guidelines -- Kitty.
PILGRIM: All right. Thanks very much.
Lisa Sylvester.
Well, that does bring us to the subject of tonight's poll. Do you believe that outsourcing maintenance on U.S. airplanes to foreign countries poses a risk to air travel? Yes or no. Cast your vote at loudobbs.com. We'll bring you the results later in the show.
Also ahead tonight, "Border Crisis." Why one high-profile senator says immigration reform is our nation's most urgent concern.
And then "Assault on the Middle Class." Why some say job security is a thing of the past for working Americans. Our special report is next.
(COMMERCIAL BREAK)
ANNOUNCER: LOU DOBBS TONIGHT continues. Sitting in for Lou Dobbs, Kitty Pilgrim.
PILGRIM: In a moment, I'll talk with Senator Chuck Hagel about his plan to reform immigration in this country.
But, first, these stories.
The body of a Wal-Mart cashier was found today in Texas, 400 miles from where she was abducted Wednesday night. A suspect is in custody in Arizona. Pictures of the kidnapping were captured on a Wal-Mart surveillance tape.
The head of the Federal Communications Commission is stepping down. During his four years in the post, Michael Powell cracked down on indecent material and fought for deregulation of the telecom industry. In a statement today, Powell said he plans to spend time with his family before pursuing other opportunities.
And there's stormy weather in space tonight after some massive solar explosions, and those explosions, known as flares, could trigger an amazing display of northern lights tonight, but those flares can also disrupt satellites and communications networks.
We have reported extensively here on our nation's border crisis. As many as three million illegal aliens crossed our boarder last year. My guest tonight says immigration reform is the most urgent problem in America.
Senator Chuck Hagel is a member of the intelligence committee and foreign relations committee. He's also chairman of the subcommittee on international economic policy, export and trade promotion. And Senator Hagel joins us from Washington.
Thanks for being with us, sir.
SEN. CHUCK HAGEL (R), NEBRASKA: Thank you, Kitty.
PILGRIM: You know, the most important issue, when you have Social Security reform and others, that does get attention, and we are giving it full attention, as you know, on this show. Why do you say this?
HAGEL: Well, because our borders, north and south, thousands of miles, are the most critical, urgent issue facing our country. Why? It is security. It's economics.
And to continue to defer dealing with immigration reform continues to put America in a very dangerous situation. We have illegals crossing our southern border, northern border every hour, every day.
Reports last week, for example, focused on various international terrorist groups starting to talk with groups south of the United States about getting some terrorists into this country.
It undermines our economic growth in this country by essentially supporting a black market in the economy. It deals directly with security and economics and our geopolitical relationships around the world, especially with our two closest friends and allies and neighbors, Canada and Mexico. So I'd say that's pretty urgent.
PILGRIM: I would say so. How much do you not sleep at night thinking about our porous borders and the security risks for terrorists coming through?
HAGEL: Well, Kitty, that is certainly one of the more urgent dynamics of this. And the fact is it is happening. And I know that we are focused on it. I know especially the last three years, homeland security and State Department, and the states that represent -- are represented along that border are all dealing with it. But we've got to do far more. And we can't just put Band-aids on it, talking about driver's licenses. Those are just symptoms of a bigger problem. We've got to get into a very core discussion and action on reforming our entire immigration process.
Another dynamic of this is pushing back the good people that want to come to this country, Kitty, the good people who are in this country now, just like your forefathers and mine came to this country for the right reasons. And we want to encourage those immigrants into this country. They're the very fabric and soul of our country.
But there are some bad ones. We've got 10 to 12 million immigrants here illegally. We don't even know where they are. We don't know who they are. We need to start getting some sense of that to begin with, so we can concentrate on the problem areas and the problem people.
PILGRIM: How does your proposal, Senator, differ from President Bush's guest worker plan?
HAGEL: Well, mine's a comprehensive immigration reform plan, Kitty. What the president is talking about is, in general terms, with principles.
I support his efforts. I support his leadership. I support his -- his courage. But he has not come up to Capitol Hill -- he may in this Congress, but he didn't in the last Congress -- with an actual proposal. He's not really proposed anything in the terms -- in terms of legislation.
And what I would do, I would take it much deeper and wider. In my Bill that I had introduced last year -- we'll introduce again this year -- in terms of real reform across the board. Not just worker visas, but let's try to focus on the 10 to 12 million illegals who are here now, start cataloging them. Where are they? Let's get them into a cycle, into a queue.
If they want to stay and be part of our society, let's find them. That's not amnesty. We're talking about six basic things. We're talking about criminal records. Have they paid their taxes? Have they been here five years? They're going to have to pay a $1,000 fine. Will somebody vouch for them? Are they working now? This is not amnesty.
But yet the good ones, and most of the people here are here for the right reasons, for hope, a better future for themselves, but mainly their families. And they're productive. They're something that's very -- these immigrants, they're very important to our country.
Let's find them. Let's get them into a queue of legality so they can start working toward eventual citizenship or whatever they want, so we can take our resources and focus on the ones who are here to do harm to our country and put a new focus on our border security.
PILGRIM: Not amnesty, Senator, but certainly accountability. Thanks very much for explaining it to us.
HAGEL: Thank you.
PILGRIM: Senator Chuck Hagel.
HAGEL: Thank you.
PILGRIM: Well, we conclude our series of special reports we call "The Assault on the Middle Class."
Tonight we look at the fading job security in this country as outsourcing and corporate consolidation replace loyalty in the workplace.
Christine Romans reports.
(BEGIN VIDEOTAPE)
CHRISTINE ROMANS, CNN CORRESPONDENT (voice-over): Gone, the same commute to the same office or factory over and over for 30 years. Gone, retirement at 60 or 65 and a solid pension. Today's worker has remarkably less job security and more anxiety.
KATE WENDLETON, THE FIVE O'CLOCK CLUB: It's just very nerve- wracking if you find that you went to a company, thought you were going to stay at a company four, five, six years, and then you get downsized again. That is pretty wrenching.
ROMANS: Wrenching and common. Workers today can expect more than 10 jobs in their first 20 years in the labor market. They'll pay more out of their own pocket for healthcare, and some of those workers will take on a second job. More than five percent of the American workforce holds down two jobs. That's nearly eight million people.
Workers used to have a contract with their employer: 40 hours a week and benefits in exchange for nearly lifetime employment. That contract has expired.
JOHN CHALLENGER, CEO, CHALLENGER, GRAY & CHRISTMAS: Companies used to ride with their people through their down times, waiting for the better times when they really needed them.
ROMANS: Today companies need mergers and routinely fire thousands of employees at a time.
CHALLENGER: Companies treat their people as just in time. They shift their work force levels up and down.
ROMANS: And sometimes shift their work force overseas. Today's workers compete with millions of manufacturing workers in China and technology workers in India and Eastern Europe.
According to the Economic Policy Institute, a swelling trade deficit with China has destroyed 1.5 million American factory jobs.
DONALD LOWMAN, TOWERS PERRIN: We had a lot of job reductions, job relocations overseas as companies outsource, then look for ways to do things more economically. And so I think it's obviously raised a lot of questions in employees' minds about what can they really count on?
ROMANS: A generation ago you could count on most households having one earner, and that earner was a man. Today, men and women are scrambling in the same competitive jobs market.
(END VIDEOTAPE)
ROMANS: And studies show men worry about job security more than women do, possibly, Kitty, because women never enjoyed that lifelong employment contract.
PILGRIM: Thanks very much. Christine Romans.
Still to come, the push for Middle East peace: what Palestinians are doing to stop other Palestinians from attacking Israelis. Former Prime Minister Benjamin Netanyahu joins me next.
And then "Heroes," how this soldier led his unit to safety after its leadership failed. Our special report is next.
(COMMERCIAL BREAK)
PILGRIM: Two thousand Palestinian security forces deployed across the northern Gaza Strip today in an effort to prevent attacks on Israeli communities. Newly elected Palestinian President Mahmoud Abbas is negotiating with leaders of radical Islamist terrorist organizations for a cease-fire. Militant leaders, however, say they will only halt attacks if Israel stops military operations.
Well, joining me now is former Israeli prime minister and current finance minister, Benjamin Netanyahu.
And thank you for joining me, sir.
BENJAMIN NETANYAHU, FORMER ISRAELI PRIME MINISTER: Good to be with you.
PILGRIM: What do you think of the latest development, about Palestinian units deployed at very critical checkpoints? What's your your assessment?
NETANYAHU: We'll see. We had a cabinet meeting a few days ago in Jerusalem, in which we said let's give the new leadership a chance to show that they're different from the old leadership of Arafat.
And the quickest way to find out is if they actually take concrete action to stop Hamas and the other terrorist groups from firing rockets into our cities and killing our children.
If they do it, we'll applaud and continue with negotiations with them. If they don't do it, well, we'll do what any government has to do and take action to stop this rocketing. PILGRIM: As you say, a very new administration, and Prime Minister Ariel Sharon broke off talks and now has sent conciliatory greetings for the Muslim holiday. A little it stop and start. Do you think that's the way it will be or do you hope for better?
NETANYAHU: These are not political negotiations. We had negotiations with the -- our military people with their security people, with the hope of seeing some responsible action, which means to actually begin to prevent terrorist actions and rocketing of civilians and eventually to dismantle these terrorist organizations.
I think that's the minimal requirement that we and the international community expect of the Palestinian leadership.
You say it's a new leadership. It's not quite a new leadership. These are Arafat's old crowd. And they really have to break with Arafat's legacy. Otherwise it's like installing in Iraq Saddam's deputy, or in Afghanistan, the Taliban deputy.
Clearly, you want to see a break. It's not so much personalities. It's not so much the identity of the individual as the policy pursued by this leadership. They have to fight terror. That's the only way we'll have peace.
PILGRIMS: There have been very hopeful signals, however, running on an antiviolence platform, meeting with Islamic leaders, Jihadist leaders saying -- calling for a ceasefire. These are very, very positive signs. Do you think Mahmoud Abbas will have the will, the strength and the control to actually execute these promises?
NETANYAHU: You put your finger on it, Kitty. It's the question of does he have the will? Frankly, does he have the guts?
I'd say that if he -- if he shirks from this, and he may well shirk from it, then he will fail. He may fail and live to see his failure, and if he tests it, there's a personal risk involved, but that's what leadership is. It always means taking on personal risk.
That's what leaders do. Otherwise you don't need to be a leader. We don't need you if you don't take risks.
PILGRIM: One of the -- one of the big variables is the timetable for withdrawing of Jewish settlements. Do you think that this will follow the agreed-upon timetable? Will there be difficulty with this? Or do you think is doable in the coming year?
NETANYAHU: I think it's doable. I frankly prefer to have it done with the plebiscite in Israel to mitigate the pressures that are building up there.
But a lot of it, I think, will depend on the security situation. And if -- the prime minister has said that if we have terror, then that's going to change his plans.
I think it's in everyone's interest to see that this terror stops and, in fact, the mechanisms of terrorists, the instruments of terror, are dismantled.
And that will be the real -- the first real test of the Palestinian leadership. That's how it will show that it's a new leadership, not merely in the technical sense, but in the practical and profound sense that we all expect.
PILGRIM: Let me call upon your expertise as finance minister. This entire process of withdrawing of settlements will involve money. It will involve a lot of resources. How do you assess that, the ability to do that going forward?
NETANYAHU: Well, we've budgeted it. And the Israeli economy is doing significantly better than most economies. The GDP grew at 4.2 percent this year after shrinking just less than two years ago. So we're in very rapid growth. Our stock market has nearly doubled in about 20 months, actually more than doubled.
And the whole economic situation is such that we can -- we can finance this. If we need a little help from our friends, we won't be shy to ask, but so far I think we're holding our own.
And what is happening in Israel is that we're conducting very rapid, very broad free market reforms. S&P just upgraded us.
I don't think people are looking now at Israel as a geopolitical risk or a security risk. Terror in general has declined by 95 percent. They're looking and they're asking, will the reformist policies continue? And I can tell you as long as I have anything to do with it, they will. I think Israel is a very good investment.
PILGRIM: Certainly, a hopeful moment. And thanks very much for joining us tonight...
NETANYAHU: Thank you.
PILGRIM: ... to talk to us about it. Benjamin Netanyahu, thank you, sir.
NETANYAHU: Good to be with you.
PILGRIM: In "Heroes" tonight, a young soldier who took control in the midst of chaos. Sgt. Cesar Desantiago was awarded one of the military's highest honors for courage under fire.
Casey Wian has his story.
(BEGIN VIDEOTAPE)
CASEY WIAN, CNN CORRESPONDENT: At Fort Campbell, Kentucky, the 101st Airborne's famed Rakkasans have returned from a training mission. They're one tour of duty in Iraq. Now they prepare for a second.
For Sgt. Cesar Desantiago, the scene is bittersweet. He didn't go with his fellow soldiers this time, because he's just days away from leaving the Army. SGT. CESAR DESANTIAGO, 101ST AIRBORNE: I've got to leave the Army, because I got married and I've got a baby on the way. And I want to be here for my baby.
WIAN: Desantiago is just 21-year-old, but already he's a decorated soldier. Courage and bravery under fire earned him a Bronze Star.
On April 8, 2003, in a fierce battle to control the city of Ar- Hallah (ph), Desantiago took over when his leader froze in fear. With bullets flying and three of his buddies injured, Desantiago led his fellow soldiers as they stormed a building.
DESANTIAGO: I was going to be point man, and I was going to be the first man in the door. And I was pretty nervous at that point.
I got the order to launch two grenades into a window on the second floor, so I did. And they went right in through the building, so that eliminated all the threat.
I was the first man in every door down in that main building where we were taking fire from. And I successfully got out my whole team.
WIAN: Desantiago survived many more encounters with the enemy before returning home a year ago. The Bronze Star surprised him.
DESANTIAGO: I thought, "Whoa, I didn't expect so much." I mean, I felt like I did what came to my mind at that time. I didn't think it was so big.
WIAN: Desantiago plans to go to college and has applied to be a policeman in Hopkinsville, Kentucky.
Casey Wian, CNN, reporting.
(END VIDEOTAPE)
PILGRIM: Elections in Iraq, why increasing violence could put the country's first Democratic elections in jeopardy. I'll discuss that and much more with four of the nation's top journalists.
Stay with us.
(COMMERCIAL BREAK)
PILGRIM: Joining me now from Washington are four of this country's top journalists: Ron Brownstein of "The Los Angeles Times"; Karen Tumulty of "TIME" magazine; Roger Simon, "U.S. News & World Report." And joining me here in New York is Steve Shepard of "BusinessWeek." And thank you all for being with me.
Steve, I'll start with you, since you're sitting right next to me.
Let's -- let's actually play to your expertise, the stock market. First time in 20 years it's been down for the first three weeks of the year. Should we start to worry or what?
STEVE SHEPARD, "BUSINESSWEEK": I think it's telling us a little bit more about what happened in 2004. Since Bush was reelected, we had a very strong rally, and it probably was a bit excessive. And so I think the market is backtracking.
You know, everybody says if it's down in January it's going to be down for the year and all that stuff. I mean, that's like, you know, hemlines and all these other indicators that don't mean anything.
So yes, we're off to a decline and probably a slow start, and there's some reasons for concern. But it's way too early to head for the hills.
PILGRIM: So don't believe all that witchcraft they come up with?
SHEPARD: I don't think so.
PILGRIM: OK. Well, let's do a segue into an important issue that's facing this country, and that's the privatization of Social Security, which is, of course, linked to markets. And let me draw in the rest of my panel.
One of the plans is for private accounts. Private accounts would presumably have some access to stock-based instruments. Let's start with Ron.
Ron, what do you think of the president's proposal?
RON BROWNSTEIN, "LOS ANGELES TIMES": Well, we're still waiting for the specifics, of course, on it. But there is a surprising amount of preliminary skirmishing that is suggesting it's going to be a very complex battlefield in both the House and the Senate.
The chairman of the House Ways and Means Committee the other day, Bill Thomas, who is a very independent, sometime ornery operator in Washington, gave some very complex and sort of Delphic comments that left the impression he did not believe the president's plan, as it's been floated, was really politically viable, that he might be moving in very different directions.
You have different camps in both parties, Kitty. You have Democrats who believe that they need to do nothing but oppose it. Others who think they have to come up with an alternative solution.
You have Republicans who want to go for the individual accounts but not long-term benefit cuts. Others are somewhat in the reverse. And some who feel that they're better not off not touching this at all.
So pulling this together is going to be quite a challenge; a lot of people moving in different directions at this point.
PILGRIM: Take quite a bit of political capital. Roger?
ROGER SIMON, "U.S. NEWS & WORLD REPORT": You know, you hate to say something is dead in the water before it's even gotten in the water, but at this point it's really hard to see how George Bush -- how George Bush puts together a winning coalition to vote for this bill. We haven't even seen the bill yet.
I mean, we've got the general outlines of the plan, which is to create an atmosphere of crisis, to convince the American people there is a crisis in Social Security, and then to threaten higher taxes unless we reform Social Security, and basically use the same tactics that he used during the campaign to gain reelection.
The trouble is too many members of his own party aren't buying this. And it's hard to see how he puts together enough Republican and Democratic votes to do this at all.
PILGRIM: I just wanted to add, nevertheless on this program we've examined the sort of resources that are left to older Americans at this point, and they are going to dwindle over the decades. Karen?
KAREN TUMULTY, "TIME" MAGAZINE: Well, I was just going to say along those lines, the resistance from his own party, the one part of Chairman Thomas' comment that was not Delphic was his description of this plan as a dead horse, which for anyone who's seen "The Godfather, Part I," the imagery is -- is hard to miss on what Congress thinks at this point.
BROWNSTEIN: But it wasn't clear if he was talking, though, about the concept of Social Security reform itself or the individual accounts. He was very critical at points on Medicare reform and helped steer that through.
The one thing the president -- there are a couple things the president has going for him in this. One is that, over the long term, people feel something has to be done. Now, whether it's his solution or not is another question.
The other thing is the concept of allowing people more control over their retirement and investment is popular to an extent. Now, whether that means undermining or reducing the guaranteed benefits that Social Security provide, again, is another questions.
But he is swimming with something of a current in public opinion that does want -- we've seen over the past generation with people involved in 401(k)s and so forth, we have more investors and people more comfortable with that to some extent.
SIMON: It depends on what poll you look at. The latest "New York Times" poll showed that 60 percent of those responding would not put their money in private accounts. And 50 percent, or a majority, said that George Bush was more concerned with Wall Street than he was with the average American when he's talking about this.
So I don't sense any huge groundswell out there to privatize Social Security or a portion of Social Security.
SHEPARD: Particularly among...
PILGRIM: Let's get Steven in on this. Yes.
SHEPARD: Particularly among the people who need it most. The lower-income people who don't participate in 401(k)'s are not likely to takes voluntary accounts in Social Security, either. So the plan won't help the people who need it most.
TUMULTY: You know what?
PILGRIM: Guys, let's just move on to really a review of what happened yesterday, which I thought was riveting, the inaugural speech. And there's been a good bit of debate today about whether it was a patriotic speech or a combative speech. What are the reviews? Let's start with Steve.
SHEPARD: Well, I mean, it was positively Wilsonian, and you know, make the world safe for democracy. It was essentially a foreign policy speech.
I'm struck by the hints in there about what he was saying about domestic policy, including Social Security. You know, liberty around the world means sort of an end to collective action in the United States. Individual responsibility is what we want, which equals the ownership society, which he calls private accounts in Social Security.
I think there were real hints of linking liberty around the world to individual liberty at the home.
PILGRIM: So you cut to the bottom line and it was domestic?
SHEPARD: I saw it in there a little bit.
PILGRIM: Yes. OK. Go ahead, Karen. Iran.
TUMULTY: I think the real question, however, is -- overseas where this goes next? Because this comes on, you know, the same day that Vice President Cheney gets on the Imus radio show and suggests that he wouldn't be surprised if Israel takes after Iran.
So the president...
PILGRIM: What?
TUMULTY: And we are going to stand up for people around the world, oppressed people, who want us to stand up for them. So the question is, so where do we go next? Is it China? Is it Uzbekistan? Where -- how far in a war-weary country are we ready to take this division?
BROWNSTEIN: Right. There is -- there is a century-long history, Kitty, of presidents giving sweeping declarations of fealty to democracy. The real issue is what price are they willing to pay to hold that commitment? And will American -- will American society support them as they do it?
Pay any price, bear any burden was very stirring, as well, in 1961, but we didn't really want to cash that check in Vietnam when it came a decade later. And that's the real question, ultimately, the impact this will have.
PILGRIM: Well, gentlemen and ladies, we have to end it right there. That's the last word, I'm sorry to say, but to be discussed, I'm sure, over dinner. Roger Simon, Roger Brownstein, Karen Tumulty, and Steve Shepard, thanks very much for joining me.
Still ahead, the results of tonight's poll, a preview of what's ahead on Monday.
(COMMERCIAL BREAK)
PILGRIM: Now the results of tonight's poll. Ninety-three percent of you believe outsourcing maintenance on U.S. airplanes to foreign countries poses a risk to air travel. Seven percent do not.
Well, thanks for being with us tonight. Please join us on Monday. The author of a new book called "The United States of Europe" says the European Union is determined to be the next superpower. He will join us.
And our special report, "Broken Borders," how states are cracking down on illegal aliens.
For all of us here, have a great weekend. Good night from New York. "CNN SPECIAL REPORT: IRAQI ELECTIONS" is next.
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