Return to Transcripts main page
Lou Dobbs Tonight
Middle Class Hit Hard by Rising Commodity Prices; Congress Debates Stiffening Bankruptcy Rules; Interview with Henry Kissinger
Aired March 09, 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.
LOU DOBBS, HOST: Tonight, "Assault on the Middle Class": skyrocketing fuel prices are now threatening the standard of living of working Americans. President Bush today called upon Congress to pass sweeping energy reforms. The chairman of the House Energy Committee is our guest.
Illegal alien giveaway. Outrage tonight over the rising number of states that give illegal aliens benefits denied most American citizens. Why should lawbreakers be receiving preferential treatment in our colleges and universities? We'll debate that issue tonight in our "Face-off."
And former secretary of state, Henry Kissinger, will be here tonight to discuss China's rising economic and political power and the importance of a U.S. strategic response to China's challenge.
ANNOUNCER: This is Lou Dobbs, for news, debate and opinion, tonight.
DOBBS: Good evening.
Also tonight, big blue and big red. The U.S. government has reviewed IBM's sale of its personal computer business to China and delivered its verdict on whether that deal is a threat to our national security.
Losing our lead. Advocates of so-called free trade maintain that the United States can sustain huge trade deficits because we are a technology powerhouse. Not anymore. The United States has now lost its leadership in the global information technology race to a country with barely one percent of our population. And yes, that country is in Asia.
And Olympic peddling. American cyclist Lance Armstrong shows his true colors in the battle between New York City and Paris for the 2012 Olympics. Mr. Armstrong's colors are red, white and blue, but they're not American.
But first tonight, America's middle class is under siege. Working families now face record prices for gasoline and heating oil. At the same time, middle-class wages are stagnant, and American jobs are being exported to cheap overseas labor markets at an escalating rate.
Congress is on the brink of passing new bankruptcy rules that would make it much more difficult for middle-class working families to eliminate their debts.
From Los Angeles, Casey Wian reports on the soaring cost of oil and other commodities. From the White House, John King reports on President Bush's plan to protect our energy supplies. And from Capitol Hill, Joe Johns reports on the new bankruptcy legislation.
We begin with Casey Wian -- Casey.
CASEY WIAN, CNN CORRESPONDENT: Lou, rising energy and raw material prices are pushing up the cost of daily life for many Americans. And nowhere are those price increases more painful than at the gasoline pump.
(BEGIN VIDEOTAPE)
WIAN (voice-over): This L.A. gas station just raised its pump prices another 10 cents.
UNIDENTIFIED MALE: Right now it's taking, like, about $40 when it used to take, like, $20.
WIAN: Nationwide, the average gasoline price is 26 cents a gallon higher than a year ago. Prices are highest in California. On average, $2.23 a gallon for regular.
On the East Coast, home heating oil is rising even faster, up nearly 50 cents in the past year.
The causes are many: OPEC, heavy demand, bad weather, a weak dollar, even fears of terrorism. The results are being felt throughout the U.S. economy.
BRAD PROCTOR, GASPRICEWATCH.COM: Everything moves in this country by fuel. We're already starting to see the local impact is delivery folks: the flower delivery, pizza people. They're starting to put a surcharge on those deliveries. We're starting to see the airlines start putting surcharges on -- they went up a good $10 just last week alone.
WIAN: Shipping costs are going up, too. FedEx now adds an 8.5 percent fuel surcharge to its bills.
And it's not just fuel. From meat to metals, many commodity prices are soaring. Adjusted for inflation, one popular commodity price measure is at its highest level since the early 1980s.
General Electric this year raised prices of its big appliances because of rising raw materials costs. Even coffee is going up.
And it all spells trouble for U.S. workers. Not only are there jobs threatened by cheap overseas labor; the prices they pay for fuel and other commodities are being pushed higher by demand from China.
PETER MORICI, UNIVERSITY OF MARYLAND: The average working Joe is getting hit from two sides: cheap Chinese goods, which are driving down his wages, and rising oil prices and gasoline prices, which are driving up his cost of living.
WIAN: The good news is those inflationary pressures are not pushing interest rates sharply higher.
(END VIDEOTAPE)
WIAN: The bad news is the last time commodity prices spiked this high, U.S. workers were in which better shape to handle the price increases because their wages were rising, as well. And as you know, Lou, wages right now are stagnant -- Lou.
DOBBS: Casey, thank you. Casey Wian from Los Angeles.
President Bush today declared he fully understands Americans' concerns about rising gasoline prices. The president said America's energy problems are a national security issue. And he repeated his call for Congress to allow oil drilling in Alaska' biggest wildlife refuge.
Senior White House correspondent John King reports.
(BEGIN VIDEOTAPE)
JOHN KING, CNN CORRESPONDENT (voice-over): Prices at the pump are heading up again. And as always, the politicians are taking notice.
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: And higher prices at the gas pump and rising home heating bills and the possibility of blackout are legitimate concerns for all Americans.
KING: The average price of gas is $2 a gallon, and it's projected to rise 15 cents a gallon more by summer.
Focusing on energy issues in Ohio, the president said rising prices are a drag on the economy. And he again called on lawmakers to pass the energy plan he has failed to get through Congress for four years now, including allowing exploration at the Arctic National Wildlife Refuge.
BUSH: By applying the most innovative environmental practices, we can carry out the project with almost no impact on land or local wildlife.
KING: But most Democrats oppose drilling at the wildlife refuge and say the president has powers to help immediately.
In this letter a group of 16 senators, all but one Democrats, urged Mr. Bush to suspend purchases for the nation's strategic petroleum reserve, saying that plan will take an average of 92,000 barrels per day off the market during the height of the driving season, between April and the end of August.
The senators say Mr. Bush should also release some reserves into the market. SEN. CHARLES SCHUMER (D), NEW YORK: Instead of going out to Ohio and making a political speech, he should turn the spigot, open the escrow (ph) and bring fuel prices down.
KING: Mr. Bush says the reserves are for national emergencies. And the White House reiterated its longstanding opposition to tapping those stockpiles to counter seasonal or other market fluctuations.
BUSH: Congress is debating the Clear Skies Initiative. But I'm going to act to get results.
KING: As Mr. Bush traveled, Congress provided a reminder of the sharp partisan divide over energy and the environment. The Senate committee deadlocked on what Mr. Bush calls his Clear Skies Initiative, but critics call an effort to weaken the Clean Air Act.
(END VIDEOTAPE)
KING: Now, inventories of oil and gas are actually at a six-year high in this country. And Lou, many analysts believe that all this talk of higher prices, mostly in the markets, but also all these speeches from politicians are as much a factor in helping to drive up the prices as the laws of supply and demand -- Lou.
DOBBS: Were it only so, John. John King, our senior White House correspondent.
The chairman of the House Energy Committee, Congressman Joe Barton, will be our guest here in just moments. We'll be talking about this escalating energy crisis, the assault on our middle class, and what the Bush administration and the Congress must do.
Middle-class Americans with massive debts are likely to find it far more difficult to declare bankruptcy in the future. The Senate tonight is on the brink of passing the biggest overhaul of our bankruptcy laws in a quarter century.
Joe Johns has our report -- Joe.
JOE JOHNS, CNN CORRESPONDENT: Lou, it has been years since the Congress first started trying to take up bankruptcy reform. It is expected, as you said, to move a step closer to reality either tonight or sometime tomorrow, barring any last-minute snag. I say that, Lou, because there have been a number of last-minute snags over the years in the past.
We have a graphic of what is in this bill as written right now. The bill makes it harder for people filing bankruptcy to wipe out their debts and get a fresh start. It would force more people into repayment plans. It also puts a means test in place so that people who have excess income after expenses for things like housing and food would be required to pay at least something to creditors.
Of course, there are strong opposing viewpoints on this bill.
(BEGIN VIDEO CLIP) SEN. RICHARD DURBIN (D), ILLINOIS: This bill is being driven by the credit card and banking industry. You know, the same people that fill your mailbox with credit card applications you never asked for?
SEN. ORRIN HATCH (R), UTAH: It's time to bring this to an end. Frankly, we've been at it for eight years. We've worked to accommodate everybody we possibly could accommodate. It's been a bipartisan bill every time, a bipartisan vote every time, an overwhelming bipartisan vote every time, and by gosh, I think it's time to vote on this bill.
(END VIDEO CLIP)
JOHNS: Supporters of the bill say the bankruptcy code is being abused by people with expensive lifestyles. On the other hand, another of the opponents of the bill, say that in their view, people who need to be protected the most are not being protected at all in this bill.
It's been around the horn a number of times. A congressional leadership here sees an opening. That's why there's a certain urgency to all of this on Capitol Hill -- Lou.
DOBBS: Joe, thank you very much. Joe Johns reporting.
The U.S. Chamber of Commerce says the number of Americans filing for bankruptcy has increased nearly five times over the past 15 years to almost 1.5 million. The top three top causes of personal bankruptcy are illness and medical bills, divorce, and the loss of a job.
Consumer advocacy groups say abuses of the existing bankruptcy laws are minimal. And judges are already quite competent to deal with people who abuse the system.
Coming up next year, why some illegal aliens in this country are entitled to in-state tuition for college, a benefit that many students, U.S. citizens, are flatly denied.
And selling out. The Bush administration says IBM can sell critically important American technology and information to the Chinese. That story is next.
(COMMERCIAL BREAK)
DOBBS: Some envy, some outrage tonight among college students in this country. Incredibly, the law in some states now gives illegal aliens benefits that countless American students are denied. Colleges and universities are allowing illegal aliens to pay in-state tuition while many American students must pay full tuition.
Katharine Barrett has the story from Salt Lake City, Utah.
(BEGIN VIDEOTAPE)
KATHARINE BARRETT, CNN CORRESPONDENT (voice-over): For over two years now, Utah has allowed children of illegal aliens who attend three years of high school here and graduate to pay in-state college tuition rates, a third of what non-Utahans must pay. Seven other states have similar laws, and many more are debating the issue.
All are waiting for action on a long-stalled congressional effort called The Dream Act. But opposition is intensifying from those who say the laws favor lawbreakers over American citizens.
KELLY WOLFE, UNIVERSITY OF UTAH STUDENT: I think it's very unfair that we have to pay out-of-state tuition when illegal aliens are granted in-state tuition.
BARRETT: After seeing this ad placed by an immigrant reform group in the campus paper, five out-of-state students at the University of Utah took up the cause. They say the university is breaking federal immigration law and demand a refund of the difference between in-state and out-of-state tuition fees, $8,000 each.
One of those who would not be in college without Utah's hope is Omar Pasaye, who came to the U.S. illegally at age 5.
OMAR PASAYE, UNIVERSITY OF UTAH STUDENT: We're trying to make something out of ourselves, you know. We're trying to follow the rules as much as we can, you know?
BARRETT: Susel Najar is an immigrant, too, but her family went through nine years of paperwork and legal proceedings to gain citizenship.
SUSEL NAJAR, UNIVERSITY OF UTAH STUDENT: I went through the right steps. I suffered, my mom suffered, my brother suffered, we all suffered. And we're not getting -- we're just being punished. We're not getting anything in return.
Like why should they get a reward and we not? I don't know. It just doesn't make sense.
BARRETT: University administrators say those who fault the policy simply don't understand.
FRED ESPLIN, UNIVERSITY OF UTAH: I think people don't understand that these students are here by virtue of being with their family. They don't understand that the families involved have been paying taxes in the state for many years. They don't understand that the same criteria that these students have to meet, they could meet and be eligible for in-state tuition, too.
BARRETT (on camera): The undergrads here opposed to Utah's policy say they have nothing against their fellow struggling students. For them, it's a question of fairness.
NAJAR: If they want to help them out, then go ahead. But do it the right way and not the wrong way.
BARRETT (voice-over): Katharine Barrett, CNN, Salt Lake City, Utah. (END VIDEOTAPE)
DOBBS: Two members of Congress with strongly opposing viewpoints about the so-called Dream Act will join me here in just a few minutes. They'll be discussing and debating the impact this controversial proposal would have on American citizens and students.
House Republicans are demanding action on the issue of illegal aliens from Secretary of State Condoleezza Rice on the eve of her visit to Mexico. Thirty-two members of the U.S. Congress wrote a letter to Rice, urging her to tell Mexico to stop encouraging its citizens to cross our border illegally.
The letter specifically mentions a cartoon travel guide printed by the Mexican government, which we've reported on here. That handbook advises Mexican citizens how to cross the U.S. border and to evade our immigration laws and law enforcement officials.
Congressman JD Heyworth of Arizona authored the letter to Secretary Rice. The congressman says urging Mexico to stop its flagrant campaign to send its citizens illegally into the United States is critical to the future of U.S.-Mexican relations.
Immigration and Customs enforcement agents yesterday arrested 27 illegal aliens who were working at a North Carolina airport. Incredibly, the illegal aliens were working within a highly secure and sensitive area, doing maintenance work on passenger and cargo aircraft. The arrest was part of Operation Tarmac, an effort to find and prosecute illegal aliens who have access to sensitive areas at our nation's airports.
The 27 people arrested at the airport in Greensboro were from eight different countries, including Mexico and the Philippines. They are now awaiting deportation.
In California, Customs and Border Protection officers seized nearly 9,000 pounds of marijuana at the Otay Mesa border crossing. The $4 million haul of marijuana hidden behind packaged Easter baskets inside a tractor trailer with California license plates. The driver was a 33-year-old Mexican man who was questioned and then released.
Still ahead tonight, selling out our national security. Amazingly, the White House has no problem with the sale of vital American technology to China. We'll have a special report on that issue coming up next.
(COMMERCIAL BREAK)
DOBBS: The Bush administration has cleared the way for IBM to sell its personal computer business to China. IBM and China's government-owned Lenovo today announced the United States has completed its national security review of that deal. Now China will likely become the owner of critically important American technology despite concerns about the threat to our national security.
Christine Romans has the report. (BEGIN VIDEOTAPE)
CHRISTINE ROMANS, CNN CORRESPONDENT (voice-over): The super- secret Committee on Foreign Investments has brushed aside national security concerns, allowing China's purchase of IBM's PC business to move ahead. It amounts to a seal of approval from the departments of Treasury, Defense and Homeland Security and the White House. But the government will not comment on its decision.
The news, instead, came from IBM headquarters in Armonk, New York and from Lenovo's base in Beijing. And China watchers are concerned by the deal itself and by the secrecy of the review.
RICHARD D'AMATO, U.S. CHINA COMMISSION: This is not sort of mergers and acquisitions a la Wall Street. This is the Chinese government buying pieces of American technology. And by the way, they've got $600 billion of U.S. dollars saved up from their trade surpluses. So this is maybe the beginning of a spending spree by the Chinese government into U.S. high technology.
ROMANS: The concern is, what will China do with that technology? And in this case, with access to U.S. government computer servicing contracts? The government instead quietly allowing 25 years of American research and development to be passed to the communist Chinese.
DON STRASZHEIM, STRASZHEIM GLOBAL ADVISORS: There's really no technology that we can tell that's especially unique or sensitive in building PC -- desktop PCs or laptop PCs. Quite frankly, it's a product now that's about as generic as Cornflakes.
ROMANS: Still, three leading congressmen had demanded a briefing on the national security of this deal, asking whether China could use IBM to spy in this country to gain access to government computer systems or use IBM technology for their military.
(END VIDEOTAPE)
ROMANS: And those congressmen have yet to have that briefing on this process. They expect to meet with the Treasury Department sometime next week. By then, this deal is all but done.
DOBBS: Incredible. Christine, thank you very much. Christine Romans.
Former Secretary of State Henry Kissinger will be joining me here later in the broadcast. We'll be talking about China's rising military, political and economic challenge to the United States' geopolitical dominance.
A disturbing report out today says the United States has already lost its dominant position in the global information technology arena to another Asian country. According to the World Economic Forum, the top spot now belongs to Singapore. The United States has fallen to fifth place. Free trade advocates, of course, suggesting that we can sustain these massive trade deficits because we are a technology- driven service economy.
Singapore, followed by three Nordic countries, Iceland, Finland and Denmark. Singapore took the lead because of its quality of its mathematics and science education, and its spending on communications technology.
The American middle class is simply under assault. Coming up next, a leading congressman who wants sweeping energy reforms to relieve at least part of the burden on hard-working American families.
And Lance's divided loyalties. America's most celebrated cyclist says a country other than his own deserves to host the 2012 Olympics.
Stay with us.
(COMMERCIAL BREAK)
DOBBS: Our next guest says soaring crude oil prices highlight the need for urgent energy reform. In just a moment, I'll be talking with the chairman of the House Energy and Commerce Committee.
Now, here are some of the other important stories we're following tonight.
Scientists in Washington State are watching one of Mount St. Helens craters. They're trying to find out why the volcano blew a huge plume of steam and ash some seven miles in the air. Scientists don't think this explosion means a major eruption will follow, but this is precisely the sequence of the eruption back in 1980.
Federal drug agents in Atlanta have announced the largest bust ever of methamphetamine in the eastern United States. Agents seized about 174 pounds of crystal meth and $1 million in cash. Officials say the drugs would be worth millions on the street.
Civil engineers have given our nation's infrastructure a near- failing grade. The report looks at 12 categories of our infrastructure, including our roads and highways, power grids and drinking water systems, showing $1.6 trillion, $1.6 trillion should be spent over the next five years alone just to fix those problems.
More now on the top story of the evening, the rising cost of energy, the rising cost of gasoline, the ongoing assault on this country's working middle class. My next guest is calling upon Congress to pass sweeping energy reform along with President Bush. Congressman Joe Barton is chairman of the Energy and Commerce Committee, joining us tonight from Capitol Hill.
Mr. Chairman, good to have you with us.
REP. JOE BARTON (R-TX), CHAIRMAN, ENERGY & COMMERCE COMMITTEE: My pleasure, Lou.
DOBBS: These oil prices, the president's call, your own, for the passage of an energy reform -- an energy bill, I'll put it that way, how quickly could it have an impact, a positive impact on what is quickly becoming a crisis in terms of energy costs for Americans?
BARTON: Well, Lou, there are no real easy short-term solutions. But if you don't have the start of at least a long-term solution, you're just going to get further and further in the hole. And a lot of us from my generation, the '60s, remember the old TV show, "The Beverly Hillbillies," where Jed's out looking for some food and misses his game, and up from the ground comes a bubbling crude. Well, it doesn't work that way in the real world.
We're trying to find crude oil and natural gas below 15,000 feet, 20,000 feet. And part of our energy bill has to be to look in America and allow drilling up in ANWAR. But we also -- we want to do stuff on clean coal technology, the president's hydrogen fuel program. We want to import more liquefied natural gas. We want to promote conservation.
I mean, we really need a comprehensive program. And we're going to have that program on the House floor hopefully in the next month. And then if we can get the Senate to work with us, have a bill on the president's desk sometime this summer, hopefully.
DOBBS: By this summer, gasoline prices are projected to be approaching $2.20 a gallon. In point of fact, in some quarters they are that already.
We have an issue now in which working people in this country in our middle class are getting hit with high interest rates because rates are moving up. We're getting hit with high energy costs. We're looking at some intense economic pressures on the people that -- you sitting on Capitol Hill are to represent.
Can we really wait that long? Aren't there some steps that can be taken to deal with $55 barrel crude oil prices and move ahead?
BARTON: Well, the reason that prices are going up -- and I know that you know this, you've talked about it on your programs in the past -- is the demand is going up. The United States is going to increase its demand demand for oil 400,000 barrels this year alone. China's probably going to go up 1 million to 1.5 million barrels. There's not that capacity in the world.
So, you know, we have got to find a way to make what we have stretch further. We've got to find some alternative sources. And we're going to have to drill for some new sources, not just overseas, but here in the U.S.
DOBBS: The president calling for ANWAR drilling. You fully support that, Mr. Chairman?
BARTON: I support it. I don't want to tell people, though, that that's going to help this summer. It will probably take 5 to 10 years, if we vote this summer to allow drilling, it will take that long for it to get into the pipeline. But it could be as much as 2 million barrels a day once it does start to flow. And that will help once it starts flowing. The short term, we're going to have to do more drilling in the lower 48. We're also going to have to very quickly push the president's hydrogen research program which could begin to move us away from an oil and gas economy.
DOBBS: The fact is, a number of Democrats, in particular, calling upon the White House to open the strategic petroleum reserve, to quit filling the reserve, trying to free up about 92,000 barrels of oil. And at the same time, introduce the SPR oil into the market to relieve some pressure. What's your view of that?
BARTON: Well, I would oppose a large release from the strategic petroleum reserve. It would have some short-term benefit. But once you'd use that oil, it's gone. So I don't support any kind of a major long-term release from the reserve.
I would think that taking the oil that we're now getting from our royalty lands in the federal OCS, outer continental shell, and putting that into the open market and taking that money and putting that money into a trust fund, I think I could go along with something like that. But I wouldn't just totally release the reserve. I'm totally supportive of the president on that position.
DOBBS: OPEC is having its way right now in the market. One can argue about the power of markets and it's a true reflection of demand. But at this point, OPEC still retains, and other oil-producing nations outside of OPEC, the capacity to produce more oil.
BARTON: Not much.
DOBBS: Well, at this point, the overhang has been reduced to what level?
BARTON: Well, the numbers that I have -- and I double-checked them today, knowing I'd be on your program -- the reserve capacity in the world today is between 1 million and 1.5 million barrels out of an 84 million demand. And by the end of the year, that will be gone.
So the days when we could ask the Saudis to increase production 2 million or 3 million barrels or the Kuwaitis or the Iraqis, that's gone. We're approaching an era where there will be no surplus production capacity anywhere in the world. And the only way to get more oil is to bid the price higher, which is why you see the per- barrel price today around $55 a barrel.
DOBBS: And that capacity -- there are some, however, as you know, suggest that OPEC could raise capacity by at least 10 percent in the short term. For how long is another matter. But the idea of $55 a barrel oil, the prospect of $80 a barrel oil let's be really candid here. We're talking about, if we were to see a price hike of that nature, an immense transfer of wealth, we've already dependent on foreign production, not only oil, clothing and a host of other products and services now, we're talking about a crippling blow to this economy, perhaps to the European economy as well, are we not?
BARTON: Well, that's why we need to pass a comprehensive energy bill and revitalize our coal industry. We have 300 years of coal supply in this country, revitalize our nuclear power industry, revitalize our natural gas industry. And, again, let's really put research into the hydrogen economy.
But I would dispute your ascertain -- not you personally, but the people that say OPEC can increase production 10 percent. They don't have it. Saudi Arabia has not found a major oil field in 30 years. The one major province in the world where we know there are reserves that could be produced in the midterm is Iraq, and Iraq could double its production, but that's over the next 3 to 5 years. There's not reserve capacity out there that you just say, instead of producing 1,000 barrels, we want to produce 2,000 barrels a day. It's not there.
DOBBS: Throw a switch.
Mr. Chairman, we thank you for being here. Congressman Joe Barton, come back soon.
BARTON: Thank you, Lou. I appreciate being on your program.
DOBBS: That brings us to the subject of our poll tonight. "Do you believe the U.S. government should be acting immediately to influence higher oil production worldwide and lower energy prices?" Yes or no? Cast your vote at loudobbs.com. We'll have the results later in the broadcast.
Tonight, a homecoming surprise for one member of the Ohio National Guard who just returned from Iraq. Michael Darnell of Dayton, Ohio, bought a 1971 Corvette over the Internet while he was on his 14-month tour, but the car's previous owners delivered it in far worse condition than Darnell had either expected or been led to expect.
That's when his friends and his family and a local classic car detailing shop took over. They all donated their time and their money to completely recondition and restore the Corvette in time for Darnell's homecoming. A happy homecoming, indeed. Especially if you're into '71 Corvettes.
Taking a look now at some of your thoughts.
Mark Hoss of East Point, Georgia, "If someone wants to be a legitimate, functioning, contributing member of our society, we must know how to communicate. My immigrant relatives were eager to learn English and assimilate. Why has this changed? Because we have allowed it."
Rosalie Shoafstall of Apache Junction, Arizona, "why do we have to press 1 to get English when we are in an English speaking country?"
Mike Adkins in Midvale, Utah, "I support drivers licenses for illegal aliens with one restriction, they can only travel south."
And Mark in Webster, New York, "Lou, did you ever think that maybe the failure of the bill to increase minimum wages goes hand in hand with the administrations refusal to do anything about sealing our borders? What better to stop outsourcing than to bring cheap foreign labor here."
We love hearing your thoughts. Send them to us at loudobbs.com. Each of you whose e-mail is read on this broadcast receives a copy of my book, "Exporting America." Please include your name and address.
Also, if you'd like to receive our e-mail newsletter, sign up on our Web site, loudobbs.com.
It seems winning the Tour de France 6 times has gone to his head. Cyclist Lance Armstrong says Paris deserves to win the bid for the 2012 Olympics over New York City. Armstrong announced his support for Paris over New York the same day the International Olympic Committee visited Paris.
The French Capital is competing against New York, London, Madrid and Moscow. The IOC will select the host city on the 6th of July this year.
Just so you know, Lance Armstrong is an American. He couldn't be any more American. He's from Austin, Texas.
Next, why illegal aliens in some states are receiving in-state tuition for our colleges and universities while many American students are denied that benefit. Stay with us.
(COMMERCIAL BREAK)
DOBBS: The so-called Dream Act would give some illegal aliens in this country legal status. The legislation has been proposed in Congress twice. It is expected to be proposed again this year. It would also give some illegal aliens the opportunity to attend U.S. colleges and universities. often for lower tuition than American students, American citizen students are themselves paying.
The Dream Act is the subject of our debate in tonight's "Face- off."
Joining us now from Washington, D.C., Congresswoman Zoe Lofgren of California who supports the Dream Act, and Congressman Virgil Good of Virginia. He opposes it. Good to have you both here.
REP. ZOE LOFGREN (D), CALIFORNIA: Thank you, Lou.
PRE VIRGIL GOODE (R), VIRGINIA: Thank you, Lou.
DOBBS: Let me start with you, Congresswoman. Why should illegal aliens be given benefits that are denied other U.S. Citizens?
LOFGREN: Well, I think the basic premise is you don't visit the sins of the father on the son. And the way the act is written, it recognizes that there are children who basically had no decision on whether they would come to the United States at all who have lived here for many years. And the idea is that since their parents have been here paying property taxes, if they can go to college, that would be a good thing for them and for us. And I think it's the wise thing to do.
DOBBS: Let me ask you something because, is there, then, a requirement that these students, illegal aliens themselves, demonstrate that their parents have paid property taxes, have paid income taxes, and paid into Social Security?
LOFGREN: Well, the -- in the act, it requires that the student have come before they were 16, that they have lived at least five years in the United States, they graduate from high school. And the assumption is, since small kids don't live here by themselves, that they're here with a parent or guardian.
Frankly, if you live in either rental housing or buy them, you're paying property taxes either through your rent or through your bill itself. So you're paying taxes and sales taxes and the like. But the real issue is, you've got kids -- and I know some of these kids -- my kids went to school with in California who didn't make the decision. And here they are -- I'll give you an example...
DOBBS: No, no.
LOFGREN: ... of a kid. It's so compelling because it really tells the story.
DOBBS: Very quickly if you would.
LOFGREN: This kid came when he was in second grade with his parents. They came actually with a visa. The parents had been pursuing (UNINTELLIGIBLE) which ultimately they did not get. This kid does not speak the language where he came from, doesn't even remember his home country. He got 800 on the math SATs, 795 on the English. You know, he's been here basically his whole life. His parents have been paying taxes. He can't go to college. I don't think that makes sense for America.
DOBBS: What do you think, Congressman Goode?
GOODE: The Dream Act, like a number of other bills in the House and in the U.S. Senate, if passed, will only encourage more illegal immigration. Illegal immigration is swamping the United States. We have millions cross the border annually. They're estimated over 12 million people in the country illegally. It's a huge strain on the resources of this country, and this is a benefit that should not be extended to illegals. In Virginia, an illegal alien would get in- state tuition, and a next-door neighbor that lived across the line in North Carolina would have to pay the full freight. It doesn't make sense. We need to stop, in this country, rewarding the illegal behavior. Until we take a firm stand against rewards for coming into the country illegally, we're not going to stop the problem.
DOBBS: Congresswoman Lofgren, how do you respond to Congressman Goode's concerns? Because, they're shared by a lot of people.
LOFGREN: Well, I'll tell you what, in the Dream Act, it doesn't say -- all it says is each state can make their own decision on in- state tuition, and I think that's problem. But I think it's worth noting that there's a lot of times where you can have a family -- a guy I know, I was just discussing the other day, he's a legal resident. He's got a U.S. citizen 13-year-old. He's wife is a legal resident. He's got a 21-year-old son without any papers and no way to get his kid legal. So, you know, he's paid taxes his whole life.
I think there needs to be a way to allow people to become educated if the they've paid taxes, they've been here a long time. And I think, actually, we need to think about young people are not making the decision on whether to come here. They're just coming along with their parents, which is why so many of the religious institutions, the Lutherans that I belong to, the Catholics and others have said, we should support this.
Whatever you think on the overall immigration issue, and I think it's a scandal. We authorize 2,000 Patrol Agents and you know what the president put in his budget, money for 100, 100. So, I mean, lets look at where the real problem is here.
DOBBS: Well, what do you say, Congressman Goode? This Dream Act is, on its face, it seems to me, addressing an issue that is of some concern. It is also quite clearly on its face inequitable. But there are so many inequities and frankly contradictions and failures within our immigration policy, it's hard to get to -- to get to at least a beginning point, isn't it?
GOODE: The fact is, the Dream Act will encourage more illegal immigration because it rewards illegal behavior.
DOBBS: Right.
GOODE: It says if you come into this country for five years, you're going to get in-state tuition. You're going to get benefits. You're going to be eligible for Pell Grants. You're going to...
LOFGREN: Actually, it doesn't say that.
GOODE: If you're -- it grants them permanent resident status. And if it does that, they would be eligible for those other things. What they need to do is to go back to the country from which they came, apply like everyone else, and get in line. And not be moved to the head of the line by illegally coming into the United States.
DOBBS: As we saw in Katharine Barrett's report, there's great resentment on the part of students who have both have immigrated and been naturalized in this country, to those who are simply jumping, as you put it, the line, who frankly are just crossing a border illegally.
But let me ask you both this. Why is there such outrage -- outrageous, it seems to me, and utter cowardice on the part of our elected representatives, the United States Congress and the United States Senate to deal honestly with a question that in every opinion survey, every poll taken shows there is -- there about 70 percent saying we have to have security of our borders, we have to fix illegal immigration, and this has to stop.
Why is it there isn't courage amongst the 435 members of Congress to deal with this issue and the 100 senators?
LOFGREN: Lou, let me say this. I do think that we are terribly deficient in control of our borders. And we actually have complained considerably about the lack of Border Patrol agents that is in the president's budget. And frankly, it ought to be more than the 2,000 authorized, and we need more technology.
On the other hand, we changed the immigration act in 1996. And I think people would be very surprised. You say, well, they ought to stand in line and get a visa. We made it almost impossible in many cases for the immediate relatives -- I'm talking spouses even minor children, and certainly young adult children of American citizens to even qualify for a visa. So if we would fix some of those things so that most families to be together, as most American's think they should be...
DOBBS: We're going -- Congresswoman, I'm sorry, we've got -- Congressman Goode, you've got to get the last word for 30 seconds. We're out of time.
GOODE: Thank you, Lou. I would ask Zoe to vote for my bill to put troops on the border. That will help secure our borders. We need a lot more Border Patrol.
LOFGREN: Well, no one thinks it's a good idea. Not the military and not the (UNINTELLIGIBLE) security people.
GOODE: And it's -- it's passed the U.S. (UNINTELLIGIBLE)
(CROSSTALK)
DOBBS: Folks, we're going to have to break off there. Congressman Goode, Congresswoman Zoe Lofgren, we thank you both for being here.
LOFGREN: Thanks, Lou.
GOODE: Thank you. Thank you for addressing the issue.
DOBBS: Coming up, next here, the Chinese threat, according to one of the world's foremost experts on foreign policy. Former secretary of state Henry Kissinger is our guest here next.
(COMMERCIAL BREAK)
DOBBS: China this week unveiled a new law, a law that authorizes the use of military force against Taiwan if Taiwan declares independence. That announcement illustrates China's rising strategic, political challenge to this country. Secretary of State Henry Kissinger and I talked earlier. And I asked him how he seriously -- how seriously he views the emergence of China as an economic and political force.
(BEGIN VIDEOTAPE)
HENRY KISSINGER, FRM. SECRETARY OF STATE: The center of gravity of international affairs, in my view, is going to shift from the Atlantic, where it has been for 400 years, to the Pacific. And the interrelationship of the countries that you mentioned, together with China, will constitute the key to international affairs in Asia.
The United States is actually in the position that it can afford to have good relations with all of them: with Japan, with India, with China and with Russia. And so that we are in a position to -- to determine, as trends develop, which combination is the one that is most helpful to American and, to our understanding, of global interests.
So of course, it is possible that any one of these countries could suddenly emerge as a threat. In that case, we will make the adjustments that are necessary.
DOBBS: Why is it that, in your judgment, that academia, think tanks that have vested ideological interests usually are simply staying away from confronting this issue, studying it and advancing some ideas?
KISSINGER: There's been a tendency that you can separate economic problems and political problems and that you can leave the solution of this particular problem essentially to market forces which to some extent you have to do, to a considerable extent. But you have to relate the market forces to the political trends before it turns into the sort of competition that in previous interests produced military conflict.
DOBBS: Absolutely. Before competition becomes confrontation.
An example of what you're talking about is the European Union seeking to lift the weapons ban against exports to China. At the same time, the United States is providing over $160 billion in freight capital over the past year for the purchase of that kind of weapons systems should the Chinese choose.
Can we, in your judgment, as one of the foremost geopolitical thinkers of the past half century, can we continue to delink economics and geopolitical interests on the part of this country?
KISSINGER: No, we certainly cannot delink economic and geopolitical consideration, because one produces the other, and they're closely -- I think it's unfortunate that the Europeans made this kind of a test case by lifting -- if they had wanted to sell some less than high-tech weapons systems and could have discussed it issue by issue, but to make it an abstract confrontational issue is not good for the Atlantic relationship. And it also isn't good for the Chinese relationship with the rest of the world because it focuses attention on the aspect of the competition that everybody should make an effort to minimize.
DOBBS: To what degree, in your judgment, will the U.S. sign a relationship be influenced by an emerging India and other South Asian countries with which we've maintained an at arm's length relationship over the past decades? But it appears now that India's becoming a primary focus of U.S. policy. KISSINGER: The emergence of India is one of the major countries will significantly affect events in Asia and events in the world.
From an American strategic point of view, we should not treat these countries as if they were tools that we can manipulate for our purposes. The will have their own necessities and their own security requirements. But just as China will impact on the surrounding countries by the growth of its economy, almost independent of its specific policies from day to day, so will India have a historic impact, especially in Southeast Asia, and also towards the West, in the Indian Ocean.
Japan is going to be conducting a more national policy. And the requirement for the United States, it's not to use these countries for sort of one-shot pressures, but to look at what their dynamics are. And while maintaining good relations with China, to see how they interact with each other independent of what we do from day to day.
DOBBS: Henry Kissinger, as always, good to have you with us.
KISSINGER: Good to be here.
(END VIDEOTAPE)
DOBBS: Still ahead, the results of our poll tonight and a preview of what's ahead tomorrow. Please stay with us.
(COMMERCIAL BREAK)
DOBBS: Results of our poll tonight, 84 percent of you said the U.S. government should be acting immediately to influence higher oil production worldwide, and lower energy prices, 16 percent disagreeing.
Thanks for being with us tonight. Join us here tomorrow. How Mexican gang members are able to cross our borders and commit heinous crimes on U.S. soil. Our special report, and 2 leading members of Congress on the hearings on Capital Hill tomorrow on illegal immigration. We hope you'll be with us.
For all of us here, good night from New York. "ANDERSON COOPER 360" 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 March 9, 2005 - 18:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
LOU DOBBS, HOST: Tonight, "Assault on the Middle Class": skyrocketing fuel prices are now threatening the standard of living of working Americans. President Bush today called upon Congress to pass sweeping energy reforms. The chairman of the House Energy Committee is our guest.
Illegal alien giveaway. Outrage tonight over the rising number of states that give illegal aliens benefits denied most American citizens. Why should lawbreakers be receiving preferential treatment in our colleges and universities? We'll debate that issue tonight in our "Face-off."
And former secretary of state, Henry Kissinger, will be here tonight to discuss China's rising economic and political power and the importance of a U.S. strategic response to China's challenge.
ANNOUNCER: This is Lou Dobbs, for news, debate and opinion, tonight.
DOBBS: Good evening.
Also tonight, big blue and big red. The U.S. government has reviewed IBM's sale of its personal computer business to China and delivered its verdict on whether that deal is a threat to our national security.
Losing our lead. Advocates of so-called free trade maintain that the United States can sustain huge trade deficits because we are a technology powerhouse. Not anymore. The United States has now lost its leadership in the global information technology race to a country with barely one percent of our population. And yes, that country is in Asia.
And Olympic peddling. American cyclist Lance Armstrong shows his true colors in the battle between New York City and Paris for the 2012 Olympics. Mr. Armstrong's colors are red, white and blue, but they're not American.
But first tonight, America's middle class is under siege. Working families now face record prices for gasoline and heating oil. At the same time, middle-class wages are stagnant, and American jobs are being exported to cheap overseas labor markets at an escalating rate.
Congress is on the brink of passing new bankruptcy rules that would make it much more difficult for middle-class working families to eliminate their debts.
From Los Angeles, Casey Wian reports on the soaring cost of oil and other commodities. From the White House, John King reports on President Bush's plan to protect our energy supplies. And from Capitol Hill, Joe Johns reports on the new bankruptcy legislation.
We begin with Casey Wian -- Casey.
CASEY WIAN, CNN CORRESPONDENT: Lou, rising energy and raw material prices are pushing up the cost of daily life for many Americans. And nowhere are those price increases more painful than at the gasoline pump.
(BEGIN VIDEOTAPE)
WIAN (voice-over): This L.A. gas station just raised its pump prices another 10 cents.
UNIDENTIFIED MALE: Right now it's taking, like, about $40 when it used to take, like, $20.
WIAN: Nationwide, the average gasoline price is 26 cents a gallon higher than a year ago. Prices are highest in California. On average, $2.23 a gallon for regular.
On the East Coast, home heating oil is rising even faster, up nearly 50 cents in the past year.
The causes are many: OPEC, heavy demand, bad weather, a weak dollar, even fears of terrorism. The results are being felt throughout the U.S. economy.
BRAD PROCTOR, GASPRICEWATCH.COM: Everything moves in this country by fuel. We're already starting to see the local impact is delivery folks: the flower delivery, pizza people. They're starting to put a surcharge on those deliveries. We're starting to see the airlines start putting surcharges on -- they went up a good $10 just last week alone.
WIAN: Shipping costs are going up, too. FedEx now adds an 8.5 percent fuel surcharge to its bills.
And it's not just fuel. From meat to metals, many commodity prices are soaring. Adjusted for inflation, one popular commodity price measure is at its highest level since the early 1980s.
General Electric this year raised prices of its big appliances because of rising raw materials costs. Even coffee is going up.
And it all spells trouble for U.S. workers. Not only are there jobs threatened by cheap overseas labor; the prices they pay for fuel and other commodities are being pushed higher by demand from China.
PETER MORICI, UNIVERSITY OF MARYLAND: The average working Joe is getting hit from two sides: cheap Chinese goods, which are driving down his wages, and rising oil prices and gasoline prices, which are driving up his cost of living.
WIAN: The good news is those inflationary pressures are not pushing interest rates sharply higher.
(END VIDEOTAPE)
WIAN: The bad news is the last time commodity prices spiked this high, U.S. workers were in which better shape to handle the price increases because their wages were rising, as well. And as you know, Lou, wages right now are stagnant -- Lou.
DOBBS: Casey, thank you. Casey Wian from Los Angeles.
President Bush today declared he fully understands Americans' concerns about rising gasoline prices. The president said America's energy problems are a national security issue. And he repeated his call for Congress to allow oil drilling in Alaska' biggest wildlife refuge.
Senior White House correspondent John King reports.
(BEGIN VIDEOTAPE)
JOHN KING, CNN CORRESPONDENT (voice-over): Prices at the pump are heading up again. And as always, the politicians are taking notice.
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: And higher prices at the gas pump and rising home heating bills and the possibility of blackout are legitimate concerns for all Americans.
KING: The average price of gas is $2 a gallon, and it's projected to rise 15 cents a gallon more by summer.
Focusing on energy issues in Ohio, the president said rising prices are a drag on the economy. And he again called on lawmakers to pass the energy plan he has failed to get through Congress for four years now, including allowing exploration at the Arctic National Wildlife Refuge.
BUSH: By applying the most innovative environmental practices, we can carry out the project with almost no impact on land or local wildlife.
KING: But most Democrats oppose drilling at the wildlife refuge and say the president has powers to help immediately.
In this letter a group of 16 senators, all but one Democrats, urged Mr. Bush to suspend purchases for the nation's strategic petroleum reserve, saying that plan will take an average of 92,000 barrels per day off the market during the height of the driving season, between April and the end of August.
The senators say Mr. Bush should also release some reserves into the market. SEN. CHARLES SCHUMER (D), NEW YORK: Instead of going out to Ohio and making a political speech, he should turn the spigot, open the escrow (ph) and bring fuel prices down.
KING: Mr. Bush says the reserves are for national emergencies. And the White House reiterated its longstanding opposition to tapping those stockpiles to counter seasonal or other market fluctuations.
BUSH: Congress is debating the Clear Skies Initiative. But I'm going to act to get results.
KING: As Mr. Bush traveled, Congress provided a reminder of the sharp partisan divide over energy and the environment. The Senate committee deadlocked on what Mr. Bush calls his Clear Skies Initiative, but critics call an effort to weaken the Clean Air Act.
(END VIDEOTAPE)
KING: Now, inventories of oil and gas are actually at a six-year high in this country. And Lou, many analysts believe that all this talk of higher prices, mostly in the markets, but also all these speeches from politicians are as much a factor in helping to drive up the prices as the laws of supply and demand -- Lou.
DOBBS: Were it only so, John. John King, our senior White House correspondent.
The chairman of the House Energy Committee, Congressman Joe Barton, will be our guest here in just moments. We'll be talking about this escalating energy crisis, the assault on our middle class, and what the Bush administration and the Congress must do.
Middle-class Americans with massive debts are likely to find it far more difficult to declare bankruptcy in the future. The Senate tonight is on the brink of passing the biggest overhaul of our bankruptcy laws in a quarter century.
Joe Johns has our report -- Joe.
JOE JOHNS, CNN CORRESPONDENT: Lou, it has been years since the Congress first started trying to take up bankruptcy reform. It is expected, as you said, to move a step closer to reality either tonight or sometime tomorrow, barring any last-minute snag. I say that, Lou, because there have been a number of last-minute snags over the years in the past.
We have a graphic of what is in this bill as written right now. The bill makes it harder for people filing bankruptcy to wipe out their debts and get a fresh start. It would force more people into repayment plans. It also puts a means test in place so that people who have excess income after expenses for things like housing and food would be required to pay at least something to creditors.
Of course, there are strong opposing viewpoints on this bill.
(BEGIN VIDEO CLIP) SEN. RICHARD DURBIN (D), ILLINOIS: This bill is being driven by the credit card and banking industry. You know, the same people that fill your mailbox with credit card applications you never asked for?
SEN. ORRIN HATCH (R), UTAH: It's time to bring this to an end. Frankly, we've been at it for eight years. We've worked to accommodate everybody we possibly could accommodate. It's been a bipartisan bill every time, a bipartisan vote every time, an overwhelming bipartisan vote every time, and by gosh, I think it's time to vote on this bill.
(END VIDEO CLIP)
JOHNS: Supporters of the bill say the bankruptcy code is being abused by people with expensive lifestyles. On the other hand, another of the opponents of the bill, say that in their view, people who need to be protected the most are not being protected at all in this bill.
It's been around the horn a number of times. A congressional leadership here sees an opening. That's why there's a certain urgency to all of this on Capitol Hill -- Lou.
DOBBS: Joe, thank you very much. Joe Johns reporting.
The U.S. Chamber of Commerce says the number of Americans filing for bankruptcy has increased nearly five times over the past 15 years to almost 1.5 million. The top three top causes of personal bankruptcy are illness and medical bills, divorce, and the loss of a job.
Consumer advocacy groups say abuses of the existing bankruptcy laws are minimal. And judges are already quite competent to deal with people who abuse the system.
Coming up next year, why some illegal aliens in this country are entitled to in-state tuition for college, a benefit that many students, U.S. citizens, are flatly denied.
And selling out. The Bush administration says IBM can sell critically important American technology and information to the Chinese. That story is next.
(COMMERCIAL BREAK)
DOBBS: Some envy, some outrage tonight among college students in this country. Incredibly, the law in some states now gives illegal aliens benefits that countless American students are denied. Colleges and universities are allowing illegal aliens to pay in-state tuition while many American students must pay full tuition.
Katharine Barrett has the story from Salt Lake City, Utah.
(BEGIN VIDEOTAPE)
KATHARINE BARRETT, CNN CORRESPONDENT (voice-over): For over two years now, Utah has allowed children of illegal aliens who attend three years of high school here and graduate to pay in-state college tuition rates, a third of what non-Utahans must pay. Seven other states have similar laws, and many more are debating the issue.
All are waiting for action on a long-stalled congressional effort called The Dream Act. But opposition is intensifying from those who say the laws favor lawbreakers over American citizens.
KELLY WOLFE, UNIVERSITY OF UTAH STUDENT: I think it's very unfair that we have to pay out-of-state tuition when illegal aliens are granted in-state tuition.
BARRETT: After seeing this ad placed by an immigrant reform group in the campus paper, five out-of-state students at the University of Utah took up the cause. They say the university is breaking federal immigration law and demand a refund of the difference between in-state and out-of-state tuition fees, $8,000 each.
One of those who would not be in college without Utah's hope is Omar Pasaye, who came to the U.S. illegally at age 5.
OMAR PASAYE, UNIVERSITY OF UTAH STUDENT: We're trying to make something out of ourselves, you know. We're trying to follow the rules as much as we can, you know?
BARRETT: Susel Najar is an immigrant, too, but her family went through nine years of paperwork and legal proceedings to gain citizenship.
SUSEL NAJAR, UNIVERSITY OF UTAH STUDENT: I went through the right steps. I suffered, my mom suffered, my brother suffered, we all suffered. And we're not getting -- we're just being punished. We're not getting anything in return.
Like why should they get a reward and we not? I don't know. It just doesn't make sense.
BARRETT: University administrators say those who fault the policy simply don't understand.
FRED ESPLIN, UNIVERSITY OF UTAH: I think people don't understand that these students are here by virtue of being with their family. They don't understand that the families involved have been paying taxes in the state for many years. They don't understand that the same criteria that these students have to meet, they could meet and be eligible for in-state tuition, too.
BARRETT (on camera): The undergrads here opposed to Utah's policy say they have nothing against their fellow struggling students. For them, it's a question of fairness.
NAJAR: If they want to help them out, then go ahead. But do it the right way and not the wrong way.
BARRETT (voice-over): Katharine Barrett, CNN, Salt Lake City, Utah. (END VIDEOTAPE)
DOBBS: Two members of Congress with strongly opposing viewpoints about the so-called Dream Act will join me here in just a few minutes. They'll be discussing and debating the impact this controversial proposal would have on American citizens and students.
House Republicans are demanding action on the issue of illegal aliens from Secretary of State Condoleezza Rice on the eve of her visit to Mexico. Thirty-two members of the U.S. Congress wrote a letter to Rice, urging her to tell Mexico to stop encouraging its citizens to cross our border illegally.
The letter specifically mentions a cartoon travel guide printed by the Mexican government, which we've reported on here. That handbook advises Mexican citizens how to cross the U.S. border and to evade our immigration laws and law enforcement officials.
Congressman JD Heyworth of Arizona authored the letter to Secretary Rice. The congressman says urging Mexico to stop its flagrant campaign to send its citizens illegally into the United States is critical to the future of U.S.-Mexican relations.
Immigration and Customs enforcement agents yesterday arrested 27 illegal aliens who were working at a North Carolina airport. Incredibly, the illegal aliens were working within a highly secure and sensitive area, doing maintenance work on passenger and cargo aircraft. The arrest was part of Operation Tarmac, an effort to find and prosecute illegal aliens who have access to sensitive areas at our nation's airports.
The 27 people arrested at the airport in Greensboro were from eight different countries, including Mexico and the Philippines. They are now awaiting deportation.
In California, Customs and Border Protection officers seized nearly 9,000 pounds of marijuana at the Otay Mesa border crossing. The $4 million haul of marijuana hidden behind packaged Easter baskets inside a tractor trailer with California license plates. The driver was a 33-year-old Mexican man who was questioned and then released.
Still ahead tonight, selling out our national security. Amazingly, the White House has no problem with the sale of vital American technology to China. We'll have a special report on that issue coming up next.
(COMMERCIAL BREAK)
DOBBS: The Bush administration has cleared the way for IBM to sell its personal computer business to China. IBM and China's government-owned Lenovo today announced the United States has completed its national security review of that deal. Now China will likely become the owner of critically important American technology despite concerns about the threat to our national security.
Christine Romans has the report. (BEGIN VIDEOTAPE)
CHRISTINE ROMANS, CNN CORRESPONDENT (voice-over): The super- secret Committee on Foreign Investments has brushed aside national security concerns, allowing China's purchase of IBM's PC business to move ahead. It amounts to a seal of approval from the departments of Treasury, Defense and Homeland Security and the White House. But the government will not comment on its decision.
The news, instead, came from IBM headquarters in Armonk, New York and from Lenovo's base in Beijing. And China watchers are concerned by the deal itself and by the secrecy of the review.
RICHARD D'AMATO, U.S. CHINA COMMISSION: This is not sort of mergers and acquisitions a la Wall Street. This is the Chinese government buying pieces of American technology. And by the way, they've got $600 billion of U.S. dollars saved up from their trade surpluses. So this is maybe the beginning of a spending spree by the Chinese government into U.S. high technology.
ROMANS: The concern is, what will China do with that technology? And in this case, with access to U.S. government computer servicing contracts? The government instead quietly allowing 25 years of American research and development to be passed to the communist Chinese.
DON STRASZHEIM, STRASZHEIM GLOBAL ADVISORS: There's really no technology that we can tell that's especially unique or sensitive in building PC -- desktop PCs or laptop PCs. Quite frankly, it's a product now that's about as generic as Cornflakes.
ROMANS: Still, three leading congressmen had demanded a briefing on the national security of this deal, asking whether China could use IBM to spy in this country to gain access to government computer systems or use IBM technology for their military.
(END VIDEOTAPE)
ROMANS: And those congressmen have yet to have that briefing on this process. They expect to meet with the Treasury Department sometime next week. By then, this deal is all but done.
DOBBS: Incredible. Christine, thank you very much. Christine Romans.
Former Secretary of State Henry Kissinger will be joining me here later in the broadcast. We'll be talking about China's rising military, political and economic challenge to the United States' geopolitical dominance.
A disturbing report out today says the United States has already lost its dominant position in the global information technology arena to another Asian country. According to the World Economic Forum, the top spot now belongs to Singapore. The United States has fallen to fifth place. Free trade advocates, of course, suggesting that we can sustain these massive trade deficits because we are a technology- driven service economy.
Singapore, followed by three Nordic countries, Iceland, Finland and Denmark. Singapore took the lead because of its quality of its mathematics and science education, and its spending on communications technology.
The American middle class is simply under assault. Coming up next, a leading congressman who wants sweeping energy reforms to relieve at least part of the burden on hard-working American families.
And Lance's divided loyalties. America's most celebrated cyclist says a country other than his own deserves to host the 2012 Olympics.
Stay with us.
(COMMERCIAL BREAK)
DOBBS: Our next guest says soaring crude oil prices highlight the need for urgent energy reform. In just a moment, I'll be talking with the chairman of the House Energy and Commerce Committee.
Now, here are some of the other important stories we're following tonight.
Scientists in Washington State are watching one of Mount St. Helens craters. They're trying to find out why the volcano blew a huge plume of steam and ash some seven miles in the air. Scientists don't think this explosion means a major eruption will follow, but this is precisely the sequence of the eruption back in 1980.
Federal drug agents in Atlanta have announced the largest bust ever of methamphetamine in the eastern United States. Agents seized about 174 pounds of crystal meth and $1 million in cash. Officials say the drugs would be worth millions on the street.
Civil engineers have given our nation's infrastructure a near- failing grade. The report looks at 12 categories of our infrastructure, including our roads and highways, power grids and drinking water systems, showing $1.6 trillion, $1.6 trillion should be spent over the next five years alone just to fix those problems.
More now on the top story of the evening, the rising cost of energy, the rising cost of gasoline, the ongoing assault on this country's working middle class. My next guest is calling upon Congress to pass sweeping energy reform along with President Bush. Congressman Joe Barton is chairman of the Energy and Commerce Committee, joining us tonight from Capitol Hill.
Mr. Chairman, good to have you with us.
REP. JOE BARTON (R-TX), CHAIRMAN, ENERGY & COMMERCE COMMITTEE: My pleasure, Lou.
DOBBS: These oil prices, the president's call, your own, for the passage of an energy reform -- an energy bill, I'll put it that way, how quickly could it have an impact, a positive impact on what is quickly becoming a crisis in terms of energy costs for Americans?
BARTON: Well, Lou, there are no real easy short-term solutions. But if you don't have the start of at least a long-term solution, you're just going to get further and further in the hole. And a lot of us from my generation, the '60s, remember the old TV show, "The Beverly Hillbillies," where Jed's out looking for some food and misses his game, and up from the ground comes a bubbling crude. Well, it doesn't work that way in the real world.
We're trying to find crude oil and natural gas below 15,000 feet, 20,000 feet. And part of our energy bill has to be to look in America and allow drilling up in ANWAR. But we also -- we want to do stuff on clean coal technology, the president's hydrogen fuel program. We want to import more liquefied natural gas. We want to promote conservation.
I mean, we really need a comprehensive program. And we're going to have that program on the House floor hopefully in the next month. And then if we can get the Senate to work with us, have a bill on the president's desk sometime this summer, hopefully.
DOBBS: By this summer, gasoline prices are projected to be approaching $2.20 a gallon. In point of fact, in some quarters they are that already.
We have an issue now in which working people in this country in our middle class are getting hit with high interest rates because rates are moving up. We're getting hit with high energy costs. We're looking at some intense economic pressures on the people that -- you sitting on Capitol Hill are to represent.
Can we really wait that long? Aren't there some steps that can be taken to deal with $55 barrel crude oil prices and move ahead?
BARTON: Well, the reason that prices are going up -- and I know that you know this, you've talked about it on your programs in the past -- is the demand is going up. The United States is going to increase its demand demand for oil 400,000 barrels this year alone. China's probably going to go up 1 million to 1.5 million barrels. There's not that capacity in the world.
So, you know, we have got to find a way to make what we have stretch further. We've got to find some alternative sources. And we're going to have to drill for some new sources, not just overseas, but here in the U.S.
DOBBS: The president calling for ANWAR drilling. You fully support that, Mr. Chairman?
BARTON: I support it. I don't want to tell people, though, that that's going to help this summer. It will probably take 5 to 10 years, if we vote this summer to allow drilling, it will take that long for it to get into the pipeline. But it could be as much as 2 million barrels a day once it does start to flow. And that will help once it starts flowing. The short term, we're going to have to do more drilling in the lower 48. We're also going to have to very quickly push the president's hydrogen research program which could begin to move us away from an oil and gas economy.
DOBBS: The fact is, a number of Democrats, in particular, calling upon the White House to open the strategic petroleum reserve, to quit filling the reserve, trying to free up about 92,000 barrels of oil. And at the same time, introduce the SPR oil into the market to relieve some pressure. What's your view of that?
BARTON: Well, I would oppose a large release from the strategic petroleum reserve. It would have some short-term benefit. But once you'd use that oil, it's gone. So I don't support any kind of a major long-term release from the reserve.
I would think that taking the oil that we're now getting from our royalty lands in the federal OCS, outer continental shell, and putting that into the open market and taking that money and putting that money into a trust fund, I think I could go along with something like that. But I wouldn't just totally release the reserve. I'm totally supportive of the president on that position.
DOBBS: OPEC is having its way right now in the market. One can argue about the power of markets and it's a true reflection of demand. But at this point, OPEC still retains, and other oil-producing nations outside of OPEC, the capacity to produce more oil.
BARTON: Not much.
DOBBS: Well, at this point, the overhang has been reduced to what level?
BARTON: Well, the numbers that I have -- and I double-checked them today, knowing I'd be on your program -- the reserve capacity in the world today is between 1 million and 1.5 million barrels out of an 84 million demand. And by the end of the year, that will be gone.
So the days when we could ask the Saudis to increase production 2 million or 3 million barrels or the Kuwaitis or the Iraqis, that's gone. We're approaching an era where there will be no surplus production capacity anywhere in the world. And the only way to get more oil is to bid the price higher, which is why you see the per- barrel price today around $55 a barrel.
DOBBS: And that capacity -- there are some, however, as you know, suggest that OPEC could raise capacity by at least 10 percent in the short term. For how long is another matter. But the idea of $55 a barrel oil, the prospect of $80 a barrel oil let's be really candid here. We're talking about, if we were to see a price hike of that nature, an immense transfer of wealth, we've already dependent on foreign production, not only oil, clothing and a host of other products and services now, we're talking about a crippling blow to this economy, perhaps to the European economy as well, are we not?
BARTON: Well, that's why we need to pass a comprehensive energy bill and revitalize our coal industry. We have 300 years of coal supply in this country, revitalize our nuclear power industry, revitalize our natural gas industry. And, again, let's really put research into the hydrogen economy.
But I would dispute your ascertain -- not you personally, but the people that say OPEC can increase production 10 percent. They don't have it. Saudi Arabia has not found a major oil field in 30 years. The one major province in the world where we know there are reserves that could be produced in the midterm is Iraq, and Iraq could double its production, but that's over the next 3 to 5 years. There's not reserve capacity out there that you just say, instead of producing 1,000 barrels, we want to produce 2,000 barrels a day. It's not there.
DOBBS: Throw a switch.
Mr. Chairman, we thank you for being here. Congressman Joe Barton, come back soon.
BARTON: Thank you, Lou. I appreciate being on your program.
DOBBS: That brings us to the subject of our poll tonight. "Do you believe the U.S. government should be acting immediately to influence higher oil production worldwide and lower energy prices?" Yes or no? Cast your vote at loudobbs.com. We'll have the results later in the broadcast.
Tonight, a homecoming surprise for one member of the Ohio National Guard who just returned from Iraq. Michael Darnell of Dayton, Ohio, bought a 1971 Corvette over the Internet while he was on his 14-month tour, but the car's previous owners delivered it in far worse condition than Darnell had either expected or been led to expect.
That's when his friends and his family and a local classic car detailing shop took over. They all donated their time and their money to completely recondition and restore the Corvette in time for Darnell's homecoming. A happy homecoming, indeed. Especially if you're into '71 Corvettes.
Taking a look now at some of your thoughts.
Mark Hoss of East Point, Georgia, "If someone wants to be a legitimate, functioning, contributing member of our society, we must know how to communicate. My immigrant relatives were eager to learn English and assimilate. Why has this changed? Because we have allowed it."
Rosalie Shoafstall of Apache Junction, Arizona, "why do we have to press 1 to get English when we are in an English speaking country?"
Mike Adkins in Midvale, Utah, "I support drivers licenses for illegal aliens with one restriction, they can only travel south."
And Mark in Webster, New York, "Lou, did you ever think that maybe the failure of the bill to increase minimum wages goes hand in hand with the administrations refusal to do anything about sealing our borders? What better to stop outsourcing than to bring cheap foreign labor here."
We love hearing your thoughts. Send them to us at loudobbs.com. Each of you whose e-mail is read on this broadcast receives a copy of my book, "Exporting America." Please include your name and address.
Also, if you'd like to receive our e-mail newsletter, sign up on our Web site, loudobbs.com.
It seems winning the Tour de France 6 times has gone to his head. Cyclist Lance Armstrong says Paris deserves to win the bid for the 2012 Olympics over New York City. Armstrong announced his support for Paris over New York the same day the International Olympic Committee visited Paris.
The French Capital is competing against New York, London, Madrid and Moscow. The IOC will select the host city on the 6th of July this year.
Just so you know, Lance Armstrong is an American. He couldn't be any more American. He's from Austin, Texas.
Next, why illegal aliens in some states are receiving in-state tuition for our colleges and universities while many American students are denied that benefit. Stay with us.
(COMMERCIAL BREAK)
DOBBS: The so-called Dream Act would give some illegal aliens in this country legal status. The legislation has been proposed in Congress twice. It is expected to be proposed again this year. It would also give some illegal aliens the opportunity to attend U.S. colleges and universities. often for lower tuition than American students, American citizen students are themselves paying.
The Dream Act is the subject of our debate in tonight's "Face- off."
Joining us now from Washington, D.C., Congresswoman Zoe Lofgren of California who supports the Dream Act, and Congressman Virgil Good of Virginia. He opposes it. Good to have you both here.
REP. ZOE LOFGREN (D), CALIFORNIA: Thank you, Lou.
PRE VIRGIL GOODE (R), VIRGINIA: Thank you, Lou.
DOBBS: Let me start with you, Congresswoman. Why should illegal aliens be given benefits that are denied other U.S. Citizens?
LOFGREN: Well, I think the basic premise is you don't visit the sins of the father on the son. And the way the act is written, it recognizes that there are children who basically had no decision on whether they would come to the United States at all who have lived here for many years. And the idea is that since their parents have been here paying property taxes, if they can go to college, that would be a good thing for them and for us. And I think it's the wise thing to do.
DOBBS: Let me ask you something because, is there, then, a requirement that these students, illegal aliens themselves, demonstrate that their parents have paid property taxes, have paid income taxes, and paid into Social Security?
LOFGREN: Well, the -- in the act, it requires that the student have come before they were 16, that they have lived at least five years in the United States, they graduate from high school. And the assumption is, since small kids don't live here by themselves, that they're here with a parent or guardian.
Frankly, if you live in either rental housing or buy them, you're paying property taxes either through your rent or through your bill itself. So you're paying taxes and sales taxes and the like. But the real issue is, you've got kids -- and I know some of these kids -- my kids went to school with in California who didn't make the decision. And here they are -- I'll give you an example...
DOBBS: No, no.
LOFGREN: ... of a kid. It's so compelling because it really tells the story.
DOBBS: Very quickly if you would.
LOFGREN: This kid came when he was in second grade with his parents. They came actually with a visa. The parents had been pursuing (UNINTELLIGIBLE) which ultimately they did not get. This kid does not speak the language where he came from, doesn't even remember his home country. He got 800 on the math SATs, 795 on the English. You know, he's been here basically his whole life. His parents have been paying taxes. He can't go to college. I don't think that makes sense for America.
DOBBS: What do you think, Congressman Goode?
GOODE: The Dream Act, like a number of other bills in the House and in the U.S. Senate, if passed, will only encourage more illegal immigration. Illegal immigration is swamping the United States. We have millions cross the border annually. They're estimated over 12 million people in the country illegally. It's a huge strain on the resources of this country, and this is a benefit that should not be extended to illegals. In Virginia, an illegal alien would get in- state tuition, and a next-door neighbor that lived across the line in North Carolina would have to pay the full freight. It doesn't make sense. We need to stop, in this country, rewarding the illegal behavior. Until we take a firm stand against rewards for coming into the country illegally, we're not going to stop the problem.
DOBBS: Congresswoman Lofgren, how do you respond to Congressman Goode's concerns? Because, they're shared by a lot of people.
LOFGREN: Well, I'll tell you what, in the Dream Act, it doesn't say -- all it says is each state can make their own decision on in- state tuition, and I think that's problem. But I think it's worth noting that there's a lot of times where you can have a family -- a guy I know, I was just discussing the other day, he's a legal resident. He's got a U.S. citizen 13-year-old. He's wife is a legal resident. He's got a 21-year-old son without any papers and no way to get his kid legal. So, you know, he's paid taxes his whole life.
I think there needs to be a way to allow people to become educated if the they've paid taxes, they've been here a long time. And I think, actually, we need to think about young people are not making the decision on whether to come here. They're just coming along with their parents, which is why so many of the religious institutions, the Lutherans that I belong to, the Catholics and others have said, we should support this.
Whatever you think on the overall immigration issue, and I think it's a scandal. We authorize 2,000 Patrol Agents and you know what the president put in his budget, money for 100, 100. So, I mean, lets look at where the real problem is here.
DOBBS: Well, what do you say, Congressman Goode? This Dream Act is, on its face, it seems to me, addressing an issue that is of some concern. It is also quite clearly on its face inequitable. But there are so many inequities and frankly contradictions and failures within our immigration policy, it's hard to get to -- to get to at least a beginning point, isn't it?
GOODE: The fact is, the Dream Act will encourage more illegal immigration because it rewards illegal behavior.
DOBBS: Right.
GOODE: It says if you come into this country for five years, you're going to get in-state tuition. You're going to get benefits. You're going to be eligible for Pell Grants. You're going to...
LOFGREN: Actually, it doesn't say that.
GOODE: If you're -- it grants them permanent resident status. And if it does that, they would be eligible for those other things. What they need to do is to go back to the country from which they came, apply like everyone else, and get in line. And not be moved to the head of the line by illegally coming into the United States.
DOBBS: As we saw in Katharine Barrett's report, there's great resentment on the part of students who have both have immigrated and been naturalized in this country, to those who are simply jumping, as you put it, the line, who frankly are just crossing a border illegally.
But let me ask you both this. Why is there such outrage -- outrageous, it seems to me, and utter cowardice on the part of our elected representatives, the United States Congress and the United States Senate to deal honestly with a question that in every opinion survey, every poll taken shows there is -- there about 70 percent saying we have to have security of our borders, we have to fix illegal immigration, and this has to stop.
Why is it there isn't courage amongst the 435 members of Congress to deal with this issue and the 100 senators?
LOFGREN: Lou, let me say this. I do think that we are terribly deficient in control of our borders. And we actually have complained considerably about the lack of Border Patrol agents that is in the president's budget. And frankly, it ought to be more than the 2,000 authorized, and we need more technology.
On the other hand, we changed the immigration act in 1996. And I think people would be very surprised. You say, well, they ought to stand in line and get a visa. We made it almost impossible in many cases for the immediate relatives -- I'm talking spouses even minor children, and certainly young adult children of American citizens to even qualify for a visa. So if we would fix some of those things so that most families to be together, as most American's think they should be...
DOBBS: We're going -- Congresswoman, I'm sorry, we've got -- Congressman Goode, you've got to get the last word for 30 seconds. We're out of time.
GOODE: Thank you, Lou. I would ask Zoe to vote for my bill to put troops on the border. That will help secure our borders. We need a lot more Border Patrol.
LOFGREN: Well, no one thinks it's a good idea. Not the military and not the (UNINTELLIGIBLE) security people.
GOODE: And it's -- it's passed the U.S. (UNINTELLIGIBLE)
(CROSSTALK)
DOBBS: Folks, we're going to have to break off there. Congressman Goode, Congresswoman Zoe Lofgren, we thank you both for being here.
LOFGREN: Thanks, Lou.
GOODE: Thank you. Thank you for addressing the issue.
DOBBS: Coming up, next here, the Chinese threat, according to one of the world's foremost experts on foreign policy. Former secretary of state Henry Kissinger is our guest here next.
(COMMERCIAL BREAK)
DOBBS: China this week unveiled a new law, a law that authorizes the use of military force against Taiwan if Taiwan declares independence. That announcement illustrates China's rising strategic, political challenge to this country. Secretary of State Henry Kissinger and I talked earlier. And I asked him how he seriously -- how seriously he views the emergence of China as an economic and political force.
(BEGIN VIDEOTAPE)
HENRY KISSINGER, FRM. SECRETARY OF STATE: The center of gravity of international affairs, in my view, is going to shift from the Atlantic, where it has been for 400 years, to the Pacific. And the interrelationship of the countries that you mentioned, together with China, will constitute the key to international affairs in Asia.
The United States is actually in the position that it can afford to have good relations with all of them: with Japan, with India, with China and with Russia. And so that we are in a position to -- to determine, as trends develop, which combination is the one that is most helpful to American and, to our understanding, of global interests.
So of course, it is possible that any one of these countries could suddenly emerge as a threat. In that case, we will make the adjustments that are necessary.
DOBBS: Why is it that, in your judgment, that academia, think tanks that have vested ideological interests usually are simply staying away from confronting this issue, studying it and advancing some ideas?
KISSINGER: There's been a tendency that you can separate economic problems and political problems and that you can leave the solution of this particular problem essentially to market forces which to some extent you have to do, to a considerable extent. But you have to relate the market forces to the political trends before it turns into the sort of competition that in previous interests produced military conflict.
DOBBS: Absolutely. Before competition becomes confrontation.
An example of what you're talking about is the European Union seeking to lift the weapons ban against exports to China. At the same time, the United States is providing over $160 billion in freight capital over the past year for the purchase of that kind of weapons systems should the Chinese choose.
Can we, in your judgment, as one of the foremost geopolitical thinkers of the past half century, can we continue to delink economics and geopolitical interests on the part of this country?
KISSINGER: No, we certainly cannot delink economic and geopolitical consideration, because one produces the other, and they're closely -- I think it's unfortunate that the Europeans made this kind of a test case by lifting -- if they had wanted to sell some less than high-tech weapons systems and could have discussed it issue by issue, but to make it an abstract confrontational issue is not good for the Atlantic relationship. And it also isn't good for the Chinese relationship with the rest of the world because it focuses attention on the aspect of the competition that everybody should make an effort to minimize.
DOBBS: To what degree, in your judgment, will the U.S. sign a relationship be influenced by an emerging India and other South Asian countries with which we've maintained an at arm's length relationship over the past decades? But it appears now that India's becoming a primary focus of U.S. policy. KISSINGER: The emergence of India is one of the major countries will significantly affect events in Asia and events in the world.
From an American strategic point of view, we should not treat these countries as if they were tools that we can manipulate for our purposes. The will have their own necessities and their own security requirements. But just as China will impact on the surrounding countries by the growth of its economy, almost independent of its specific policies from day to day, so will India have a historic impact, especially in Southeast Asia, and also towards the West, in the Indian Ocean.
Japan is going to be conducting a more national policy. And the requirement for the United States, it's not to use these countries for sort of one-shot pressures, but to look at what their dynamics are. And while maintaining good relations with China, to see how they interact with each other independent of what we do from day to day.
DOBBS: Henry Kissinger, as always, good to have you with us.
KISSINGER: Good to be here.
(END VIDEOTAPE)
DOBBS: Still ahead, the results of our poll tonight and a preview of what's ahead tomorrow. Please stay with us.
(COMMERCIAL BREAK)
DOBBS: Results of our poll tonight, 84 percent of you said the U.S. government should be acting immediately to influence higher oil production worldwide, and lower energy prices, 16 percent disagreeing.
Thanks for being with us tonight. Join us here tomorrow. How Mexican gang members are able to cross our borders and commit heinous crimes on U.S. soil. Our special report, and 2 leading members of Congress on the hearings on Capital Hill tomorrow on illegal immigration. We hope you'll be with us.
For all of us here, good night from New York. "ANDERSON COOPER 360" 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
