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Lou Dobbs Tonight

Judge Orders Feeding Tube Removed from Brain-Damaged Woman; Press Conference With Sheriff Jeff Dawsy; Interview with Fred Bergsten

Aired March 18, 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.


KITTY PILGRIM, HOST: Tonight, we're moments away from a news conference about a major development in the case of the missing Florida girl, Jessica Lunsford. We'll bring you that news conference as soon as it begins.
For another developing story we're following tonight, a 10-year legal battle to determine Terri Schiavo's fate that reaches a climax. Congress intervenes at the last minute and tonight a decision on whether Terri Schiavo will be allowed to die.

Also tonight, illegal alien pay-off: Wal-Mart pays a record fine, but escapes criminal sanctions, even though illegal aliens cleaned its stores.

And nuclear showdown: escalating nuclear tensions with North Korea and Iran.

ANNOUNCER: This is LOU DOBBS for news, debate and opinion, tonight. Sitting in for Lou Dobbs, Kitty Pilgrim.

PILGRIM: Good evening.

Tonight an extraordinary clash between Congress and state courts over a critical issue of life and death. Now, at issue is whether Terri Schiavo should be allowed to die 15 years after she collapsed. Congress tried to stop the removal of Terri Schiavo's feeding tube, but the Florida judge presiding over the case ruled against Congress.

Joe Johns has been following the day's dramatic developments in Congress -- Joe.

JOE JOHNS, CNN CORRESPONDENT: Kitty, it certainly has been dramatic. Five subpoenas issued by the House of Representatives, a committee on that side. Meanwhile, on the Senate side, the Senate Health Committee issuing an invitation to Terri Schiavo and his -- and her husband to appear here on Capitol Hill March 28. All of this an attempt to try to keep that feeding tube in place.

As you've reported, the feeding tube has been removed. Extraordinary measures on Capitol Hill, things this Congress is not known for, particularly when it comes to trying to intervene in family and medical decisions.

Just a little while ago, the house majority leader, Tom DeLay, put out a statement, giving his latest justification for it, in part saying, "Right now murder is being created against a defenseless American citizen in Florida. Terri Schiavo's feeding tube should be immediately replaced and the Congress will continue working with ways to save her."

Mr. Delay spoke just a little while ago on CNN.

(BEGIN VIDEO CLIP)

REP. TOM DELAY (R-TX), MAJORITY LEADER: The United States Constitution protects every citizen in America from having their life taken from them. It's obvious that Florida and Florida law do not protect this United States citizen under the United States Constitution to be starved to death.

She's not -- I mean, this is pretty amazing to me that Florida law is stronger on abusing an animal. If you did this to an animal, you would go to prison for a year and be fined $5,000 or both.

(END VIDEO CLIP)

JOHNS: There is still an issue outstanding of legislation. The House and Senate tried late this week to work on the some legislation on the Terri Schiavo matter. They were unable to come to agreement.

A clear possibility, and some say almost a certainty, that the House and Senate will try once again on Monday to work out their differences on that legislation.

Meanwhile, as we have noted earlier, Michael Schiavo, his attorney went on CNN and other media, and really just issuing a blast against a number of members of Congress, both Democrats and Republicans. Of course, those Democrats and Republicans are now taking issue with some of the things he said.

Kitty, back to you.

PILGRIM: All right. Thank you very much, Joe Johns. Well, joining me now for more on this very complicated case is Jeffrey Toobin, CNN senior legal analyst.

And Jeffrey, thanks for joining us. Let's start with the whole Congress versus the courts scenario. This is very unusual, isn't it?

JEFFREY TOOBIN, CNN LEGAL ANALYST: This is unusual at so many different levels.

The status quo now is the feeding tube has been removed. Some court has to order the feeding tube to be replaced. The state courts have basically checked out of it. They have said this is our decision.

So apparently Terri Schiavo's parents have filed a federal lawsuit, to try to get the federal courts to do it, and this legislation is a possibility, and that may lead to another federal lawsuit.

PILGRIM: Now, this feeding tube has been removed twice previously, correct?

TOOBIN: Correct.

PILGRIM: And there's a certainly amount of time during which -- that she can survive while this is out...

TOOBIN: Said to be a week to two weeks.

PILGRIM: And what are the options? So we've just talked about Congress and the courts. What are the options in Congress? They're at recess now or they will reconvene Monday?

TOOBIN: That is the -- Tom DeLay was just talking to Wolf Blitzer and said that they may reconvene on Monday.

It is by no means clear that Congress could pass a constitutional way of getting involved. Congress passes legislation that applies across the board to all citizens. It is virtually unprecedented for them to pass a law directed as a single medical case. That would surely be challenged in the courts and, of course, the clock is now ticking with the -- with the feeding tube removed.

PILGRIM: The great argument is that the Constitution protects life fundamentally, so that would be the justification for doing that?

TOOBIN: That would be one justification, but there is also something in the Constitution called a prohibition on bills of attainder, and what that means is Congress is not supposed to pass laws directed at specific individuals. That's one issue.

Also, matters relating to individual people like this are generally the province of the states. The state of Florida has spoken here. That is sure to set off another court clash.

PILGRIM: What about the living will issue? Where does that stand?

TOOBIN: Well, I think Americans have received a terrific reminder that if you want to have -- avoid this kind of circumstance, you have -- you sign a living will before you have a medical problem.

PILGRIM: The absence of one now...

TOOBIN: The absence of one is a crucial factor here, because the whole -- one of the big issues in the litigation is what did Terri Schiavo intend? Her husband has said repeatedly she did not want to live this way, and the courts have ultimately agreed with her -- with him, saying this is simply her will we are exercising.

Her parents feel very differently. They've fought on in the courts. They've lost so far. They're still fighting.

PILGRIM: The U.S. Supreme Court has refused this, correct? Could it go there?

TOOBIN: It could go back. That wouldn't be entirely surprising. What the Florida legislature did is they passed a law saying put the feeding tube back. The Florida Supreme Court said that's unconstitutional. The United States Supreme Court said we will not review that decision.

But these are new federal lawsuits filed. The Supreme Court could get involved again.

PILGRIM: We need a legal analyst to sort through this. Thank you very much, Jeffrey Toobin.

Well, let's go now to Carol Lin in Clearwater, Florida. That's where the case judge today ordered Terri Schiavo's feeding tube removed. Carol, what's the latest on that?

CAROL LIN, CNN CORRESPONDENT: Well, the latest here is that Terri Schiavo's parents' attorney has been given a series of news conferences, trying to update reporters on exactly what may happen next.

I know you've been going through a lot of the different legal angles, but the bottom line is their best hope right now is with the eleventh circuit court of appeals. They are asking for an emergency weekend to review this case.

Also, the Schindlers, Terri Schiavo's parents, have filed a lawsuit against Judge George Greer, the circuit court judge here in Pinellas County, as well as a suit against the husband in federal courts, saying that they have denied Terri Schiavo her rights, her rights to due process.

They're hoping that the courts will need to address this, and by addressing it, they may find -- figure out a way to reinsert her tube until it is processed, essentially.

In the meantime, the mood here has been very somber. It's been a day filled with various Christian groups and so-called right to life groups who have been praying.

We've heard some details of when the feeding tube was disconnected from Terri Schiavo, that the husband had sent a representative to the room. There was a doctor, as well as a series of healthcare workers there who said prayers, and the mood was considered peaceful and calm.

The Schindlers had been sitting vigil by their daughter's bedside throughout most of the day, but at that point when the tube was to be removed, they were asked to leave the room, Kitty. It has been a really tough day for all sides of this story.

PILGRIM: Thanks very much, Carol Lin.

Well, that does bring us to the subject of tonight's poll. And we would like you to respond. We're interested in what you think. Who do you believe should decide Terri Schiavo's fate on this very important issue: the courts, Congress, her parents or her husband? We don't take this poll lightly, but we are interested in our viewers' opinions. Cast your vote at LouDobbs.com. We'll bring you the results a little bit later in the show.

Well, a news conference on the very latest develop in the search for Jessica Lunsford is expected in just a few minutes. We'll bring you that, to you live, as soon as that happens.

And also up next, the world's biggest retailer pays the price for allowing illegal aliens to work in its stores. Stay with us.

(COMMERCIAL BREAK)

PILGRIM: In our series of "Broken Borders" tonight, Wal-Mart has agreed to pay $11 million to settle charges that it allowed hundreds of illegal aliens to work as janitors in its stores. This is fine is a record for the Immigration and Customs Enforcement, but it's a small percentage of what Wal-Mart earns in one day.

Christine Romans reports.

(BEGIN VIDEOTAPE)

CHRISTINE ROMANS, CNN CORRESPONDENT (voice-over): Wal-Mart Friday tried to put the ugly episode behind it, paying $11 million to settle Operation Rollback, a federal sting operation that found 352 illegal aliens working at Wal-Mart stores in 21 states. For that price, Wal-Mart doesn't have to admit guilt, it avoids criminal charges, and no executives have been fired. It's a record settlement of immigration abuses, but Wal-Mart used more friendly language to describe the penalty.

"As a part of our ongoing partnership with the government, we've agreed to contribute $11 million to help support the fair enforcement of immigration law." The government hailed the size of the settlement, but Wal-Mart, with $288 billion in sales last year, rings up that much in 19 minutes at the cash register. In a press conference, government officials had nothing but praise for the retail giant.

THOMAS MARINO, U.S. ATTORNEY: Wal-Mart has stepped forward from the beginning of the investigation, cooperated 100 percent with us, and I want to make something clear. The law allows us to prosecute the individual employer who employs the illegal aliens. Wal-Mart was not the employer.

ROMANS: Wal-Mart has blamed its subcontractors for the hiring, and 12 of those companies will plead guilty to criminal charges. But critics doubt that Wal-Mart was so clueless about illegal aliens working in its stores.

JAMES LINDSEY, PLAINTIFFS' ATTORNEY: They had to know. These people worked in the stores seven nights a week, 365 days a year, they didn't speak English. And Wal-Marts are located in some of the tiniest towns in the country. It's like you're watching Andy of Mayberry and a group of Mongolians move to town.

ROMANS: Lindsey represents the illegal alien workers in a civil lawsuit pending in New Jersey. (END VIDEOTAPE)

ROMANS: But by writing a check, Wal-Mart has avoided criminal charges in this case, and Wal-Mart has promised that it will make sure that these immigration violations just don't happen again -- Kitty.

PILGRIM: I guess that's called settling the case, right, Christine?

ROMANS: Absolutely.

PILGRIM: Thanks very much. Christine Romans.

Well, we are waiting for a news conference on the very latest developments in the search for Jessica Lunsford. It is expected in just a few minutes. We'll bring you that live as soon as it happens.

Also coming up on this program, nuclear showdown, escalating nuclear tensions with North Korea and Iran. I'll be joined by Bobby Inman, former director of the National Security Agency.

Stay with us.

(COMMERCIAL BREAK)

PILGRIM: In Iraq today, an American soldier was shot and killed almost two years to the day after the war began. The military said the task force Baghdad soldier was on patrol in northeast Baghdad when the gunman opened fire. More than 1,500 Americans have been killed in Iraq since the start of the war.

The Pentagon is spending millions of dollars on a project that many hope will save countless American lives. The goal is to develop a new generation of soldiers using robot technology.

Senior Pentagon correspondent Jamie McIntyre reports.

(BEGIN VIDEOTAPE)

JAMIE MCINTYRE, CNN SR. PENTAGON CORRESPONDENT (voice-over): This explosion two months ago in Iraq is a result of U.S. soldiers employing the latest in robot technology using a small radio- controlled vehicle called the PackBot to detonate a roadside bomb. The PackBot was developed by iRobot, a cutting-edge company outside Boston co-founded by Helen Greiner, an MIT engineer who saw her future in "Star Wars."

HELEN GREINER, CHAIRMAN, IROBOT CORPORATION: When I was 11, I went to see "Star Wars" with my parents and I was just -- I was really inspired by R2D2. R2D2 wasn't just a machine. You know, he had a personality, he had an agenda.

MCINTYRE: While the versatile PackBot can't think for itself, it can do reconnaissance, disarm bombs and search caves. And it worked so well in Iraq and Afghanistan, the Pentagon just put in an $18 million order for 150 more. (on camera): It will be a long time before robots every replace humans, but what they're perfect for is dirty, dull or dangerous jobs.

(voice-over): The next challenge for robot designers, deadly urban combat. So future urban assaults like the siege of Falluja may be done with the aid of swarms of small robots.

Just like tiny mechanical spiders searched for Tom Cruise in the movie "Minority Report," these rudimentary machines in development by iRobot use the same swarm principle. They talk to each other so one operator can control hundreds at a time.

VICE ADM. JOE DYER (RET.), IROBOT GOVERNMENT INDUSTRIAL DIVISION: But over time we're going to see robots that can take a mission, go out and execute it, navigate themselves, see, communicate back, gather information, come back and deliver that information in a human-like function.

MCINTYRE: Joe Dyer is a retired Navy admiral and F-18 pilot who now works for iRobot. He predicts the world of robots envisioned by sci-fi genius Isaac Asimov ad depicted in the movie "I, Robot" is maybe 25 years away.

DYER: "I, Robot" the movie we think had it about right. You'll start to see androids that you might want to go out and have a beer with.

MCINTYRE: And while Dyer says humans will remain in the loom (ph) for a long time, at iRobot (UNINTELLIGIBLE) sort of like people. In the lobby hangs a memorial to a PackBot who died in the line of duty.

Jamie McIntyre, CNN, Boston.

(END VIDEOTAPE)

PILGRIM: And we've been waiting for a news conference from the Citrus County, Florida, sheriff's office on the disappearance of 9- year-old Jessica Lunsford. Sara Dorsey has been following the story for us, and she joins us now from Citrus County, Florida -- Sara.

SARA DORSEY, CNN CORRESPONDENT: Well, Kitty, the latest is a family member tells us that the Lunsford family was informed a search warrant to search the area behind the home that John Couey was staying with is in the hand of Citrus County officials. I'm going to get out of the way a little bit here so you can see the area. Police -- Citrus County sheriff's officers, rather, have roped off this entire area with police tape.

Now, John Couey is the man who was named a couple nights ago as a person of interest in this case. He is a convicted sex offender. He lives just across the street from the Lunsford home, so the Lunsford home I believe is what you're seeing now, and then if we can pan over, there's a trailer off in the distance. And that would be where John Couey was staying. Police first named him a person of interest for several reasons. One being he was not staying in the home he was registered in, rather staying in this trailer very close to where Jessica Lunsford disappeared from three weeks ago.

Other reasons, when investigators went to the home, knocking to ask family members if indeed John was staying there, they lied to investigators. They learned he had taken a bus trip under a different name to Savannah.

At that point police questioned him and then lost him for a while because Savannah officials did not have jurisdiction. He was later taking into custody in Augusta, Georgia, where he has been questioned by Citrus County sheriff's officials and FBI agents.

Earlier in the day we were hearing he had said nothing that would really move this case forward, and then about an hour and a half ago, Citrus County sheriff's officers just emerged on this area, shutting off a nearly two-block radius. You can see sheriff's, officials cars everywhere.

We saw a Citrus County crime scene investigation truck come in here, also an emergency response team come into this area. Again, we are waiting for a press conference that will be held in Inverness, Florida, at the Citrus County sheriff's headquarters. That is 20 minutes late. It's been continually pushed back, so we're waiting to hear what they're going to say.

But right now the Citrus County sheriff's officials are telling us there is a major development in this case. And that's obvious just from looking what's going on here.

Earlier in the day we were broadcasting from right in front of the Lunsford home. All the media has now been pushed back. And we are waiting again to hear exactly what the latest development is -- Kitty.

PILGRIM: All right. Thanks very much, Sara Dorsey, for that recent update. Thank you very much.

And we'll of course continue to follow all the latest developments on this investigation. We'll bring you the Citrus County sheriff's new conference as soon as it begins, and we are expecting it momentarily.

Also, coming up next on the program, nuclear showdown, the threat from North Korea and Iran. A leading expert on intelligence and national security will join me.

And also, the high cost of free trade, rising calls for a crackdown on China's unfair trade policies.

Stay with us.

(COMMERCIAL BREAK) SHERIFF JEFF DAWSY, CITRUS COUNTY POLICE DEPARTMENT: ... standing with me, and understanding that there were some things that I had to take care of before I came out here.

This will be a very short news conference. I will take some -- some questions. It will not be filled with a lot of facts and information because I don't have a whole lot.

But you've asked if my investigation will ever take a specific turn. Ladies and gentlemen, it did take a specific turn. John Couey is now the point of investigation.

John Couey today -- as you well know, yesterday, as you very well know, he was interviewed by my investigators throughout the day. The FBI sent their polygrapher up there that did the polygraphs on the family members.

John Couey was polygraphed today, and at the end of the polygraph, he says, "You don't need to tell me the results. I already know what they are. Could I have the investigators come back in?"

And the investigators came back in. He apologized to the investigators for wasting their time.

And I'm now going to use the word that you probably waited for me to use. John Couey admitted to abducting Jessica and subsequently taking her life. I really don't have a whole lot of information for you besides that.

If anybody has any questions, I will be leaving here to go to the family. As you all are very well aware, that my security has enhanced around the residence, and it will remain there.

My PIOs and you have worked very well together. I ask that you understand this is a very tough time not only for me, it's a very tough time for the family. My PIOs will be in contact with them, and we will try to be in contact with you and orchestrate whatever we can to facilitate.

With that, again, I'm going to answer a few questions. I do want to try to stay halfway composed for you.

QUESTION: (UNINTELLIGIBLE)?

DAWSY: He's told us a general area.

QUESTION: Any luck in finding her (UNINTELLIGIBLE)?

DAWSY: This will take hours.

QUESTION: The search is under way now?

DAWSY: Pretty much so.

QUESTION: How long (UNINTELLIGIBLE)?

DAWSY: Oh, I don't know that yet.

QUESTION: When are you expecting, though (UNINTELLIGIBLE)?

DAWSY: Well, remember, this is breaking news. And I wish I could give you all the figures.

We are in the process of talking with our state attorney here. He's not going anywhere up there. He's on a no-bond, and we will bring him back once we do everything correct.

And, you know, we've talked about building a case. And this is not a time to sing anybody's praises, but I will tell you that we have built a case, a very methodical case, and I've got my man.

QUESTION: Sheriff, is there any negotiating (UNINTELLIGIBLE) that's taking death penalty off the table in exchange for cooperation of...

DAWSY: I have not be made aware of -- that would have to be cleared through me, and that didn't get cleared through me.

QUESTION: Did he give you a timeline of when he abducted Jessica, how long he held her, what he did? I mean, did he...

DAWSY: No.

QUESTION: ... sort of lay out...

DAWSY: He's probably doing that as we speak, but again, it's very early. And as the night goes on, I'll be very -- I'll be made aware of what happens.

Yes, sir?

QUESTION: Did he give you an idea of how he got in? No sign...

DAWSY: I can't go through that right now. We are now are in a major criminal case, and I'm going to shut down some of the information, understandably so, on the criminal end until I can approach the state attorney's office with all facts and figures.

QUESTION: Sheriff, have you been in touch with...

QUESTION: What brought to this change of heart...

DAWSY: I don't know, I wasn't up there. I'm just telling you, my investigators, after he finished with the polygrapher, he turned to him and said, "Bring the investigators in," and started to confess.

QUESTION: Sheriff, can you tell me, have you talked to Mark Lunsford and what his reaction might have been?

DAWSY: That was the reason why it took me so long to come out here. We were locating Mark and subsequently calling Jessica's mom to let them know -- at the same time, and then to come out and brief you. And that's what took us a little bit longer. QUESTION: What was that conversation like, sir?

DAWSY: I don't know. I mean, I just was told by my -- one of my commanders that the information has been relayed. And then I knew you guys were on a timeline and I wanted to come out to you guys.

QUESTION: About what time was the confession?

QUESTION: (UNINTELLIGIBLE) if he took her from the home? Or was she outside?

DAWSY: Again, that's the criminal end of it. As soon as I get verification, I will get back to you. I don't have -- again, let me explain. I don't have a whole lot of data. I wanted to come out and let you to hear it from me.

Thank you.

QUESTION: Sheriff, what was his demeanor when he confessed?

DAWSY: Again, I wasn't there. I mean, it must have been fairly -- I'm searching for the word. I apologize. I'm a little brain fade right now.

I guess it was cordial. You know, I don't think, you know, we had to hold him down or anything. He asked for them to come in.

UNIDENTIFIED FEMALE: One last question.

DAWSY: One last question.

UNIDENTIFIED FEMALE: One last question.

QUESTION: Are there any other cases in Citrus County now that you think we may need to re-look at John Couey because there are things that we hadn't investigated before?

DAWSY: We're going to look. We -- he had talked to us quite a while. We're going to look at a lot of things, but nothing of any major magnitude. And, you know, that's really the only questions -- I'm stumbling right now, and I apologize. I'm not...

QUESTION: Details (OFF-MIKE)

DAWSY: No, again, I apologize. I'm going to the residence. You will see me there, and I imagine I will see you there also.

QUESTION: But no other, like, sexual molestation cases that hadn't been...

DAWSY: Not that I'm aware of, OK.

UNIDENTIFIED FEMALE: Timeline for media, we're working on getting some -- putting some facts and timelines together for you.

PILGRIM: A very different statement from Jeff Dawsy, who has said, I've got my man. John Evander Couey admitted to abducting Jessica Lunsford and admitted to taking her life.

We now go to Sara Dorsey, who is on the scene -- Sara.

SARA DORSEY, CNN CORRESPONDENT: Well, Kitty, a very tragic ending to this week search for missing 9-year-old Jessica Lunsford. Just moments ago, in fact, I'll have the photographer pan over. This is the granddaughter, we are told, of Ruth and Archie Lunsford, which would make her Mark's niece, I believe. She's just hearing the news standing around with media members that John Couey did in fact admit to abducting and subsequently killing Jessica Lunsford.

Now, from here, as you can see, this area is crawling with sheriff's officials. The sheriff himself says he's heading over to this home. This area is blocked off. And we are told that now the search will go on to try to locate the body of Jessica Lunsford. Apparently John Couey told investigators a general area to look. We see that the area that is really blocked off the most is that behind the home that John Couey was staying in.

And Kitty, again to give you some background, just a few nights ago, the sheriff came out naming John Couey as a person of interest. And the reason why they did that is he was a sex offender -- a convicted sex offender. And when this case first started, the sheriff, of course, starts looking at the family and then goes out. They looked at sex offenders in this general area. John Couey, did not fall into that category, but once those sex offenders where are where they were supposed to be, they went to the whole entire county.

That's when John Couey's name came up, because he was not staying in the home he was registered in. When police started -- sheriff's officials started digging, they found out Couey had been staying in a trailer just really across the street from where Jessica Lunsford disappeared from. As investigators started digging the family member that Couey was living with lied to them about him staying there.

They later learned, of course, that they had been lied to, and came back, and got more information. They also learned that Couey left town, telling people that investigators would be looking for him. He left on a bus ticket that was in someone else's name, not his own, and fled to the Savannah area. He was picked up by authorities there, but they didn't have jurisdiction to hold him under the warrant that was out, because he was not a suspect in this case, so they didn't have a particular warrant relating to the Jessica Lunsford case to hold him on.

He was let go in Savannah, eventually they did find hem in Augusta, they have questioned him. And again, we just found out minutes ago in that press conference, he has admitted to kidnapping and killing 9-year-old Jessica Lunsford -- Kitty.

PILGRIM: All right, thank you very much, Sara Dorsey has been following this story for us in Citrus County, Florida.

And we'll be right back in a moment. Stay with us.

(COMMERCIAL BREAK) PILGRIM: Tonight Secretary of State Condoleezza Rice is in Asia. North Korea's nuclear ambitions are at the top of her agenda. And Rice will meet with senior Japanese officials in Tokyo, tomorrow. Then she's going to fly to South Korea and China. Rice wants Asian countries to help persuade North Korea to rejoin talks on it's nuclear weapon's program.

Joining me to talk about North Korea and other threats is one of the countries most distinguished former intelligence officials, Admiral Bobby Inman, a former director of the National Security Agency, and former deputy director of the CIA.

And thanks for being with us this evening.

ADMIRAL BOBBY INMAN, FORMER INTELLIGENCE OFFICER: You're welcome.

PILGRIM: You know, the trip through Asia is really to garner support for North Korea, is it not?

INMAN: It is, but it's very important that she go to Asia early. She'd been to Europe. Asia is terribly important to us in the years out ahead. As you look at the threats, North Korea becoming a nuclear power stands pretty close to the top of that list.

PILGRIM: What kind of language might we hear? And if the language has been very strong, but is it time to even be more stronger?

INMAN: She'll be direct about the need to get on with the negotiations, but she'll also, I hope, be very strong at rejecting the idea of bilateral communications. We tried that. We negotiated with them in '94, and they promptly violated it. The reason we need China to lead this, China's the only country that's got real leverage over North Korea. They can cut off their energy supply. And if China lead the discussions, the odds are high that China will oversee the actual carrying out of the agreement.

PILGRIM: Now, China's been hosting previous rounds of six-party talks. What more can they do?

INMAN: Continue to talk. But to really put the pressure on North Korea to get back in the talks. The problem here, we probably aren't going to be able to keep North Korea from having nuclear weapons. They probably already have them. The concern with North Korea is that they'll sell them, that they might sell them to terrorists. They've sold everything else that's movable that they have. It's an impoverished nation ruled by a despot, and looking for any sort of support. This is the one country, right now, that I fear might sell nuclear weapons.

PILGRIM: The great worry is that while all this talking is going on, they're getting more and more advanced, that makes more time for North Korea, which makes a considerable amount of money exporting weapons to proceed. INMAN: My personal guess is they have already some weapons in the process. But there's been a lot of work the last several years of putting together, if you detect that they are in fact trying to ship a weapon, how do you interdict it?

We've not worried about it before, but North Korea makes us worry about it.

PILGRIM: Well, she's at the spearhead of this issue. Let me ask you something that I really can't let you go without asking you. The -- John Negroponte, the U.S. Ambassador to Iraq, now head of the national intelligence director, how do you see his role changing from the way intelligence works in the past?

INMAN: He's been a user of intelligence in a variety of very senior positions. When you're looking at restructuring the whole intelligence community, where do you put the resources, and how do you judge the quality of what's being produced?

Intelligence professionals are like college professors, which I am one. You work on the things that interest you, but it may not be what the user needs. John Negroponte brings extraordinary experience at a lot of levels as a user of intelligence. And that's what I'm banking on. That with coupling with Mike (ph) -- the -- the director of the NSA, he's an old friend. And I suddenly bobbled the name, I apologize.

PILGRIM: Oh, that's all right. Thank you very much for giving us your insight into the agency, and thanks very much for being with us, Bobby Inman, retired director of National Security Agency. Thank you.

INMAN: Thank you very much.

PILGRIM: Coming up next, the high cost of so-called free trade. Why one free trader now says the United States needs to take action against China. Stay with us.

(COMMERCIAL BREAK)

PILGRIM: Now, we reported extensively here on the high cost of so-called free trade, and it includes our exploding trade deficit, millions of American jobs which are lost to cheap foreign labor markets.

And my next guest is a long-time advocate of free trade, but now he says the United States and others must take action against China for its unfair trade practices. Fred Bergsten is the director of the Institute for International Economics, and he joining us from Washington.

And thanks for being with us.

FRED BERGSTEN, DIR. INSTITUTE FOR INTERNATIONAL ECONOMICS: Good to be here. PILGRIM: You know, the great argument is America's -- American's benefit from a lot of cheap, Chinese products that come into our country and, you know, it's not so bad, because it improves cost of living. But there's an enormous down side to this, isn't there?

BERGSTEN: Well, the U.S. as a whole benefits enormously from international trade. Our economy is about $1 trillion per year better off, cheaper imports, much higher paying export jobs, much higher productivity because of international competition. And we can gain another $500 billion per year if we would go all the way to global free trade. So the overall picture is very positive.

At the moment we have a big and growing trade deficit. That's because we as a country are buying more from the rest of the world then we sell. We've got to get our own house in order to correct that, by reducing our budget deficit. But we've got to get some help from other countries. And the Chinese and others Asians are blocking the necessary adjustment by preventing the dollar exchange rate from declining to a level that would make our country more competitive in international markets.

PILGRIM: What should we do about the China problem, the manipulation of the currency, and the infringement on copy rights, the real chronic problems that we have with a trading partner like China that doesn't make for a level playing field?

BERGSTEN: Well, the biggest part of the problem overwhelmingly is the exchange rate. There are some specific trade issues like you mentioned, but the big one is the exchange rate. China pegs its currency to the dollar. As the dollar has declined over the last three years against the euro, the yen and other currencies, China has ridden the dollar down. The Chinese have actually become more competitive over the last three years by riding the dollar down. Becoming more competitive through a cheaper currency that makes their products even more competitive in world markets.

We need -- and in doing so, as a big trade surplus country, they are violating all the international rules of the game. The rules of the international monetary fund on exchange rates. The rules of the WTO on trade. So what we need to do is take a very active and aggressive lead, mobilize the international community, get the International Monetary Fund to implement its own rules, go after the Chinese and require them to re-value their currency, move it up in value 20, 25 percent, and level the playing field in that way.

PILGRIM: Get a lot tougher with China.

Let me ask you something, and it's a sort of what does it mean to us question. We have this enormous account deficit, we have rising oil prices. In fact, oil hit a record against today. Do you see problems for the American economy ahead given the mix of things that we have going? And you're a respected global economist. You certainly have the weapons at hand to decide whether we're in trouble or not.

BERGSTEN: Well, I think there is two risks to the American economy, which is strong at the moment, and has a very promising underlying prospect. But there are 2 big risks. These trade deficits could at some early point lead to a very sharp decline of the dollar exchange rate. That would push up inflation here, it could push up interest rates sharply, that would trash the stock market and it could push our economy down very sharply.

At the same time, energy prices are going up. Oil could easily go to 60, $70 a barrel, even more. And the interaction of high energy prices and a crashing dollar would be poison for the economy.

Those were the two things that happened in the 1970s. They created the term stagflation. And in the late 1970s, we in this country wound up with double-digit inflation, 20 percent interest rates and the worst recession since the 1930s.

Now, I don't think we'll have that again. But the combination of high energy prices, of big trade deficit leading to the risk of a fall in the dollar are poisonous. We need to take policy actions to prevent both of those things happening.

There is time to do it. It can be done. But we have no effective policies in either area at this time.

PILGRIM: Thank you so much for bringing it to our attention, Fred Bergsten. Thank you.

BERGSTEN: My pleasure.

PILGRIM: On a much lighter note now, our featured series "America's Bright Future." Tonight a 15-year-old with exceptional musical abilities. As a freshman in high school Steve Renko has already gained national recognition for his remarkable ability to play of drums. Bill Tucker has his story.

(BEGIN VIDEOTAPE)

BILL TUCKER, CNN CORRESPONDENT (voice-over): The sounds of Ernie Krivda's Fat Tuesday big band fill the practice hall. All but one of these musicians has been playing for decades. Steve Renko is 15- years-old. He's been playing since his father got his first drum set at 16 months. He won his first drum contest when he was eight-years- old.

STEVE RENKO, 15-YEAR-OLD DRUMMER: I play to make people happy, basically. I just like making people happy. Whatever it -- when they're clapping, dance, singing along, whatever, I like that a lot.

TUCKER: And to that end, there's the big band, there's the school band, the after-school jazz ensemble, and his personal favorite, the rock band.

RENKO: My typical day usually consists of school and then some drumming thing.

TUCKER: His most recent honor, to be selected to perform at the pre and post-Grammy celebrations in Los Angeles. Steve is a freshman at St. Ignatius High School in Cleveland, one of the top Jesuit all- boys schools in the country.

RENKO: Being a drummer, you know, it helps you learn to be disciplined. It helps me in school a lot, you know, with my homework and stuff.

TUCKER: His drum teacher knew he was something special from their first meeting.

BOB MCKEE, STEVE'S DRUM COACH: He sat down and played along with the record that sounded better than the guy on the record. I said, well, ten-years-old, that's pretty good, you know.

TUCKER: The leader of the big band he plays with agrees.

ERNIE KRIVDA, THE FAT TUESDAY BIG BAND: There are other prodigies out there, but it's a rare thing, and it's a rare thing in jazz.

TUCKER: Asked what he would do if one of his favorite bands like Slipknot or System of a Down came knocking on the door?

RENKO: I would talk to my dad first, because he's been in the business for a long time. He would know what to do.

TUCKER: His dad's answer? Education first.

Bill Tucker, CNN.

(COMMERCIAL BREAK)

PILGRIM: We wish him the best of luck.

Well, tonight's thought is on the value of creativity. We thought you would like this. And here it is. "I look forward to an American which will reward achievement in the arts as we reward achievement in business or statecraft. I look forward to an American which commands respect throughout the world, not only for its strength, but for its civilization as well."

Coming up, three of the nation's leading journalists will join me. Stay with us.

(COMMERCIAL BREAK)

PILGRIM: New developments in the Terri Schiavo case. Lawyers for the House of Representatives are tonight readying an appeal to the U.S. Supreme Court. Now, this after their first appeal was rejected by the Supreme Court of Florida. The lawyers plan to file their new appeal later tonight.

Now, the appeals involved enforcing subpoenas that a House committee issued earlier today. Those appeals were intended to prevent Terri Schiavo's feeding tube from being removed. Well, joining me now are three of the country's best journalists. From Washington, we have Karen Tumulty of "Time" magazine. From Boston, Roger Simon of "U.S. News & World Report." And joining me in New York, is Jim Ellis of "Businessweek." And thank you all for being here.

You know, I'll start with the Terri Schiavo case. And we've been watching it all day. It's just been heart-wrenching, very difficult, generating a good deal of discussion here in our room. And getting a variety of opinions.

Let's start with you, Karen, do you see this as a critical case for the country?

KAREN TUMULTY, TIME: You know, I don't know if it's -- what I think it is is a terrible tragedy for a family. And, you know, it certainly -- it touches one of our deepest, both cultural and ethical, divides. But I do find it a second tragedy that this has somehow been thrown now into the political arena.

PILGRIM: Roger, but does it not bring up issues that we should all be discussing in any case, that it's a test case?

ROGER SIMON, U.S. NEWS AND WORLD REPORT: Well, the issue that we should be discussing is the issue of living wills, that is making your wishes known before you are in a terrible accident as to whether you want your life prolonged by artificial means or not. Instead, we're discussing whether Congress is going to turn this tragedy into a farce.

Congress has no standing in this case. Once upon a time, there was a Republican, I think his name was Ronald Reagan who said government should get out of our lives. Instead, you have these farcical subpoenas, subpoenaing Terri Schiavo to come and testify even though she's been in a persistent vegetative state for 15 years. This is cruel.

PILGRIM: Well, it's a device to actually halt what's going on, which was the removal of the feeding tube. But yet it does bring up this whole issue, Roger, that you talk about of Congress versus the courts.

Jim, do you think that this is an appropriate play out of the different arguments?

JIM ELLIS, BUSINESSWEEK: I have to admit that I see this as sort of turning this into a circus atmosphere simply for political gain. I mean understand for a lot of the -- particularly the Republican base -- this is a hot-button issue that's very closely linked to the abortion issue. And this is a great way to score points, but I don't know if it does anything for the family.

This is a case that's been through the courts for quite a number of years. And it's not as if this hasn't been decided before.

Also, there's also a real question of whether the government, federal government actually has standing in this. We've already seen political games in this, in the Florida state, you know, legislature, and also with the governor there. So I really don't know what we're getting out of this other than a few politicians getting some extra votes.

PILGRIM: All right. Let's talk about another politically difficult issue: and that's the Medicaid budget. We had developments in that. And of course that has broader implications for all of American society.

Karen, let me ask you, where do you think we stand on this whole debate? Because we've had a setback this week for President Bush.

TUMULTY: Well certainly, the setback this week of course, was that the House of Representatives passed a budget that was much in line with what the White House wanted, which was fairly sharp cuts in Medicaid spending growth. The Republicans in Congress, of course, don't like them called cuts, they like to refer to them as savings. But basically it means the states will get more money than they were hoping for for Medicaid.

The Senate voted along the lines of what the governors' are asking, which is that before we start talking about specific amounts to cut or restrain the program, or whatever you want -- whatever euphemism you want to use, they want to see the program itself looked at from top to bottom. Because the fact is Medicaid, the healthcare program for the poor is essentially gobbling up state budgets.

There are a lots of states right now that spend more on Medicaid than they do on education. And something has got to be done in a systemic way to the whole system. Because otherwise, if the president is looking for a federal entitlement that's on the brink of crisis and needs an overhaul, it's Medicaid.

PILGRIM: Roger, perhaps even more important than the Social Security debate?

SIMON: It's unfortunately not more important to the president. But I think you're right, I think it is more important, simply because the real crisis is coming in Medicare and Medicaid. I mean, the crisis is here. That is the system truly on the verge of collapse, not Social Security.

But this debate, this wild debate in the Senate last night showed -- well, we all knew that the leadership of the Democrats and the leadership of the Republicans don't talk to each out, but now we learned that the House leadership of the Republicans and the Senate leadership of the Republicans don't talk to each other.

You have two houses of Congress who can't pass a budget, and are on a collision course as to what they're going to do about Medicaid. They're going to have to get together and agree on something, or else there won't be a budget. And we won't get to issues like Social Security and border security, and other matters.

PILGRIM: Jim, I'm going to let you have the last word on this. Is it as dire as...

ELLIS: Well, obviously Medicaid reform is needed. The problem we have here, the big danger for the administration at least is that they're going to lose momentum.

I mean, if they can't get the Republicans in the Senate to sort of talk to Republicans in the House on this issue, at the same time that he's having trouble getting Social Security changes through -- made basically a lot of his policies fall apart. I mean, that still leaves you with tax reform. But I'm not sure you're going to get that through this year anyway.

So it makes it look as if a lot of opportunities for the president are just going to be passed over.

PILGRIM: And are we at this kind of impasse in Congress, do you think?

ELLIS: I think that this is a lot more difficult to do, simply because the Republican governors don't want to cut Medicaid spending as much as the president would like. And unfortunately, he's going to -- they have to go back to the voters, they understand that, the president does not.

PILGRIM: Thanks so much. You've teared me right up on this one.

Jim Ellis, Karen Tumulty and Roger Simon, thank you very much for being with us. Have a great weekend.

All right. Let's do the results of tonight's poll. I was very serious poll: 7 percent of you believe the courts should decide Terri Schiavo's fat, 2 percent say Congress, 26 percent say her parents and 65 percent say her husband.

Thanks for being with us tonight. Please join us on Monday. American citizens take action to secure our border. And the Mexican president believes he's entitled to complain about it. The co-founder of the Minuteman Project will join us.

Also, the Secretary of Veteran's Affairs on a new program to give veterans returning from Iraq and Afghanistan a second chance at a new career.

And "Assault on the Middle Class." Why many senior citizens are beginning entirely new careers in their golden years.

Well, 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 18, 2005 - 18:00   ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
KITTY PILGRIM, HOST: Tonight, we're moments away from a news conference about a major development in the case of the missing Florida girl, Jessica Lunsford. We'll bring you that news conference as soon as it begins.
For another developing story we're following tonight, a 10-year legal battle to determine Terri Schiavo's fate that reaches a climax. Congress intervenes at the last minute and tonight a decision on whether Terri Schiavo will be allowed to die.

Also tonight, illegal alien pay-off: Wal-Mart pays a record fine, but escapes criminal sanctions, even though illegal aliens cleaned its stores.

And nuclear showdown: escalating nuclear tensions with North Korea and Iran.

ANNOUNCER: This is LOU DOBBS for news, debate and opinion, tonight. Sitting in for Lou Dobbs, Kitty Pilgrim.

PILGRIM: Good evening.

Tonight an extraordinary clash between Congress and state courts over a critical issue of life and death. Now, at issue is whether Terri Schiavo should be allowed to die 15 years after she collapsed. Congress tried to stop the removal of Terri Schiavo's feeding tube, but the Florida judge presiding over the case ruled against Congress.

Joe Johns has been following the day's dramatic developments in Congress -- Joe.

JOE JOHNS, CNN CORRESPONDENT: Kitty, it certainly has been dramatic. Five subpoenas issued by the House of Representatives, a committee on that side. Meanwhile, on the Senate side, the Senate Health Committee issuing an invitation to Terri Schiavo and his -- and her husband to appear here on Capitol Hill March 28. All of this an attempt to try to keep that feeding tube in place.

As you've reported, the feeding tube has been removed. Extraordinary measures on Capitol Hill, things this Congress is not known for, particularly when it comes to trying to intervene in family and medical decisions.

Just a little while ago, the house majority leader, Tom DeLay, put out a statement, giving his latest justification for it, in part saying, "Right now murder is being created against a defenseless American citizen in Florida. Terri Schiavo's feeding tube should be immediately replaced and the Congress will continue working with ways to save her."

Mr. Delay spoke just a little while ago on CNN.

(BEGIN VIDEO CLIP)

REP. TOM DELAY (R-TX), MAJORITY LEADER: The United States Constitution protects every citizen in America from having their life taken from them. It's obvious that Florida and Florida law do not protect this United States citizen under the United States Constitution to be starved to death.

She's not -- I mean, this is pretty amazing to me that Florida law is stronger on abusing an animal. If you did this to an animal, you would go to prison for a year and be fined $5,000 or both.

(END VIDEO CLIP)

JOHNS: There is still an issue outstanding of legislation. The House and Senate tried late this week to work on the some legislation on the Terri Schiavo matter. They were unable to come to agreement.

A clear possibility, and some say almost a certainty, that the House and Senate will try once again on Monday to work out their differences on that legislation.

Meanwhile, as we have noted earlier, Michael Schiavo, his attorney went on CNN and other media, and really just issuing a blast against a number of members of Congress, both Democrats and Republicans. Of course, those Democrats and Republicans are now taking issue with some of the things he said.

Kitty, back to you.

PILGRIM: All right. Thank you very much, Joe Johns. Well, joining me now for more on this very complicated case is Jeffrey Toobin, CNN senior legal analyst.

And Jeffrey, thanks for joining us. Let's start with the whole Congress versus the courts scenario. This is very unusual, isn't it?

JEFFREY TOOBIN, CNN LEGAL ANALYST: This is unusual at so many different levels.

The status quo now is the feeding tube has been removed. Some court has to order the feeding tube to be replaced. The state courts have basically checked out of it. They have said this is our decision.

So apparently Terri Schiavo's parents have filed a federal lawsuit, to try to get the federal courts to do it, and this legislation is a possibility, and that may lead to another federal lawsuit.

PILGRIM: Now, this feeding tube has been removed twice previously, correct?

TOOBIN: Correct.

PILGRIM: And there's a certainly amount of time during which -- that she can survive while this is out...

TOOBIN: Said to be a week to two weeks.

PILGRIM: And what are the options? So we've just talked about Congress and the courts. What are the options in Congress? They're at recess now or they will reconvene Monday?

TOOBIN: That is the -- Tom DeLay was just talking to Wolf Blitzer and said that they may reconvene on Monday.

It is by no means clear that Congress could pass a constitutional way of getting involved. Congress passes legislation that applies across the board to all citizens. It is virtually unprecedented for them to pass a law directed as a single medical case. That would surely be challenged in the courts and, of course, the clock is now ticking with the -- with the feeding tube removed.

PILGRIM: The great argument is that the Constitution protects life fundamentally, so that would be the justification for doing that?

TOOBIN: That would be one justification, but there is also something in the Constitution called a prohibition on bills of attainder, and what that means is Congress is not supposed to pass laws directed at specific individuals. That's one issue.

Also, matters relating to individual people like this are generally the province of the states. The state of Florida has spoken here. That is sure to set off another court clash.

PILGRIM: What about the living will issue? Where does that stand?

TOOBIN: Well, I think Americans have received a terrific reminder that if you want to have -- avoid this kind of circumstance, you have -- you sign a living will before you have a medical problem.

PILGRIM: The absence of one now...

TOOBIN: The absence of one is a crucial factor here, because the whole -- one of the big issues in the litigation is what did Terri Schiavo intend? Her husband has said repeatedly she did not want to live this way, and the courts have ultimately agreed with her -- with him, saying this is simply her will we are exercising.

Her parents feel very differently. They've fought on in the courts. They've lost so far. They're still fighting.

PILGRIM: The U.S. Supreme Court has refused this, correct? Could it go there?

TOOBIN: It could go back. That wouldn't be entirely surprising. What the Florida legislature did is they passed a law saying put the feeding tube back. The Florida Supreme Court said that's unconstitutional. The United States Supreme Court said we will not review that decision.

But these are new federal lawsuits filed. The Supreme Court could get involved again.

PILGRIM: We need a legal analyst to sort through this. Thank you very much, Jeffrey Toobin.

Well, let's go now to Carol Lin in Clearwater, Florida. That's where the case judge today ordered Terri Schiavo's feeding tube removed. Carol, what's the latest on that?

CAROL LIN, CNN CORRESPONDENT: Well, the latest here is that Terri Schiavo's parents' attorney has been given a series of news conferences, trying to update reporters on exactly what may happen next.

I know you've been going through a lot of the different legal angles, but the bottom line is their best hope right now is with the eleventh circuit court of appeals. They are asking for an emergency weekend to review this case.

Also, the Schindlers, Terri Schiavo's parents, have filed a lawsuit against Judge George Greer, the circuit court judge here in Pinellas County, as well as a suit against the husband in federal courts, saying that they have denied Terri Schiavo her rights, her rights to due process.

They're hoping that the courts will need to address this, and by addressing it, they may find -- figure out a way to reinsert her tube until it is processed, essentially.

In the meantime, the mood here has been very somber. It's been a day filled with various Christian groups and so-called right to life groups who have been praying.

We've heard some details of when the feeding tube was disconnected from Terri Schiavo, that the husband had sent a representative to the room. There was a doctor, as well as a series of healthcare workers there who said prayers, and the mood was considered peaceful and calm.

The Schindlers had been sitting vigil by their daughter's bedside throughout most of the day, but at that point when the tube was to be removed, they were asked to leave the room, Kitty. It has been a really tough day for all sides of this story.

PILGRIM: Thanks very much, Carol Lin.

Well, that does bring us to the subject of tonight's poll. And we would like you to respond. We're interested in what you think. Who do you believe should decide Terri Schiavo's fate on this very important issue: the courts, Congress, her parents or her husband? We don't take this poll lightly, but we are interested in our viewers' opinions. Cast your vote at LouDobbs.com. We'll bring you the results a little bit later in the show.

Well, a news conference on the very latest develop in the search for Jessica Lunsford is expected in just a few minutes. We'll bring you that, to you live, as soon as that happens.

And also up next, the world's biggest retailer pays the price for allowing illegal aliens to work in its stores. Stay with us.

(COMMERCIAL BREAK)

PILGRIM: In our series of "Broken Borders" tonight, Wal-Mart has agreed to pay $11 million to settle charges that it allowed hundreds of illegal aliens to work as janitors in its stores. This is fine is a record for the Immigration and Customs Enforcement, but it's a small percentage of what Wal-Mart earns in one day.

Christine Romans reports.

(BEGIN VIDEOTAPE)

CHRISTINE ROMANS, CNN CORRESPONDENT (voice-over): Wal-Mart Friday tried to put the ugly episode behind it, paying $11 million to settle Operation Rollback, a federal sting operation that found 352 illegal aliens working at Wal-Mart stores in 21 states. For that price, Wal-Mart doesn't have to admit guilt, it avoids criminal charges, and no executives have been fired. It's a record settlement of immigration abuses, but Wal-Mart used more friendly language to describe the penalty.

"As a part of our ongoing partnership with the government, we've agreed to contribute $11 million to help support the fair enforcement of immigration law." The government hailed the size of the settlement, but Wal-Mart, with $288 billion in sales last year, rings up that much in 19 minutes at the cash register. In a press conference, government officials had nothing but praise for the retail giant.

THOMAS MARINO, U.S. ATTORNEY: Wal-Mart has stepped forward from the beginning of the investigation, cooperated 100 percent with us, and I want to make something clear. The law allows us to prosecute the individual employer who employs the illegal aliens. Wal-Mart was not the employer.

ROMANS: Wal-Mart has blamed its subcontractors for the hiring, and 12 of those companies will plead guilty to criminal charges. But critics doubt that Wal-Mart was so clueless about illegal aliens working in its stores.

JAMES LINDSEY, PLAINTIFFS' ATTORNEY: They had to know. These people worked in the stores seven nights a week, 365 days a year, they didn't speak English. And Wal-Marts are located in some of the tiniest towns in the country. It's like you're watching Andy of Mayberry and a group of Mongolians move to town.

ROMANS: Lindsey represents the illegal alien workers in a civil lawsuit pending in New Jersey. (END VIDEOTAPE)

ROMANS: But by writing a check, Wal-Mart has avoided criminal charges in this case, and Wal-Mart has promised that it will make sure that these immigration violations just don't happen again -- Kitty.

PILGRIM: I guess that's called settling the case, right, Christine?

ROMANS: Absolutely.

PILGRIM: Thanks very much. Christine Romans.

Well, we are waiting for a news conference on the very latest developments in the search for Jessica Lunsford. It is expected in just a few minutes. We'll bring you that live as soon as it happens.

Also coming up on this program, nuclear showdown, escalating nuclear tensions with North Korea and Iran. I'll be joined by Bobby Inman, former director of the National Security Agency.

Stay with us.

(COMMERCIAL BREAK)

PILGRIM: In Iraq today, an American soldier was shot and killed almost two years to the day after the war began. The military said the task force Baghdad soldier was on patrol in northeast Baghdad when the gunman opened fire. More than 1,500 Americans have been killed in Iraq since the start of the war.

The Pentagon is spending millions of dollars on a project that many hope will save countless American lives. The goal is to develop a new generation of soldiers using robot technology.

Senior Pentagon correspondent Jamie McIntyre reports.

(BEGIN VIDEOTAPE)

JAMIE MCINTYRE, CNN SR. PENTAGON CORRESPONDENT (voice-over): This explosion two months ago in Iraq is a result of U.S. soldiers employing the latest in robot technology using a small radio- controlled vehicle called the PackBot to detonate a roadside bomb. The PackBot was developed by iRobot, a cutting-edge company outside Boston co-founded by Helen Greiner, an MIT engineer who saw her future in "Star Wars."

HELEN GREINER, CHAIRMAN, IROBOT CORPORATION: When I was 11, I went to see "Star Wars" with my parents and I was just -- I was really inspired by R2D2. R2D2 wasn't just a machine. You know, he had a personality, he had an agenda.

MCINTYRE: While the versatile PackBot can't think for itself, it can do reconnaissance, disarm bombs and search caves. And it worked so well in Iraq and Afghanistan, the Pentagon just put in an $18 million order for 150 more. (on camera): It will be a long time before robots every replace humans, but what they're perfect for is dirty, dull or dangerous jobs.

(voice-over): The next challenge for robot designers, deadly urban combat. So future urban assaults like the siege of Falluja may be done with the aid of swarms of small robots.

Just like tiny mechanical spiders searched for Tom Cruise in the movie "Minority Report," these rudimentary machines in development by iRobot use the same swarm principle. They talk to each other so one operator can control hundreds at a time.

VICE ADM. JOE DYER (RET.), IROBOT GOVERNMENT INDUSTRIAL DIVISION: But over time we're going to see robots that can take a mission, go out and execute it, navigate themselves, see, communicate back, gather information, come back and deliver that information in a human-like function.

MCINTYRE: Joe Dyer is a retired Navy admiral and F-18 pilot who now works for iRobot. He predicts the world of robots envisioned by sci-fi genius Isaac Asimov ad depicted in the movie "I, Robot" is maybe 25 years away.

DYER: "I, Robot" the movie we think had it about right. You'll start to see androids that you might want to go out and have a beer with.

MCINTYRE: And while Dyer says humans will remain in the loom (ph) for a long time, at iRobot (UNINTELLIGIBLE) sort of like people. In the lobby hangs a memorial to a PackBot who died in the line of duty.

Jamie McIntyre, CNN, Boston.

(END VIDEOTAPE)

PILGRIM: And we've been waiting for a news conference from the Citrus County, Florida, sheriff's office on the disappearance of 9- year-old Jessica Lunsford. Sara Dorsey has been following the story for us, and she joins us now from Citrus County, Florida -- Sara.

SARA DORSEY, CNN CORRESPONDENT: Well, Kitty, the latest is a family member tells us that the Lunsford family was informed a search warrant to search the area behind the home that John Couey was staying with is in the hand of Citrus County officials. I'm going to get out of the way a little bit here so you can see the area. Police -- Citrus County sheriff's officers, rather, have roped off this entire area with police tape.

Now, John Couey is the man who was named a couple nights ago as a person of interest in this case. He is a convicted sex offender. He lives just across the street from the Lunsford home, so the Lunsford home I believe is what you're seeing now, and then if we can pan over, there's a trailer off in the distance. And that would be where John Couey was staying. Police first named him a person of interest for several reasons. One being he was not staying in the home he was registered in, rather staying in this trailer very close to where Jessica Lunsford disappeared from three weeks ago.

Other reasons, when investigators went to the home, knocking to ask family members if indeed John was staying there, they lied to investigators. They learned he had taken a bus trip under a different name to Savannah.

At that point police questioned him and then lost him for a while because Savannah officials did not have jurisdiction. He was later taking into custody in Augusta, Georgia, where he has been questioned by Citrus County sheriff's officials and FBI agents.

Earlier in the day we were hearing he had said nothing that would really move this case forward, and then about an hour and a half ago, Citrus County sheriff's officers just emerged on this area, shutting off a nearly two-block radius. You can see sheriff's, officials cars everywhere.

We saw a Citrus County crime scene investigation truck come in here, also an emergency response team come into this area. Again, we are waiting for a press conference that will be held in Inverness, Florida, at the Citrus County sheriff's headquarters. That is 20 minutes late. It's been continually pushed back, so we're waiting to hear what they're going to say.

But right now the Citrus County sheriff's officials are telling us there is a major development in this case. And that's obvious just from looking what's going on here.

Earlier in the day we were broadcasting from right in front of the Lunsford home. All the media has now been pushed back. And we are waiting again to hear exactly what the latest development is -- Kitty.

PILGRIM: All right. Thanks very much, Sara Dorsey, for that recent update. Thank you very much.

And we'll of course continue to follow all the latest developments on this investigation. We'll bring you the Citrus County sheriff's new conference as soon as it begins, and we are expecting it momentarily.

Also, coming up next on the program, nuclear showdown, the threat from North Korea and Iran. A leading expert on intelligence and national security will join me.

And also, the high cost of free trade, rising calls for a crackdown on China's unfair trade policies.

Stay with us.

(COMMERCIAL BREAK) SHERIFF JEFF DAWSY, CITRUS COUNTY POLICE DEPARTMENT: ... standing with me, and understanding that there were some things that I had to take care of before I came out here.

This will be a very short news conference. I will take some -- some questions. It will not be filled with a lot of facts and information because I don't have a whole lot.

But you've asked if my investigation will ever take a specific turn. Ladies and gentlemen, it did take a specific turn. John Couey is now the point of investigation.

John Couey today -- as you well know, yesterday, as you very well know, he was interviewed by my investigators throughout the day. The FBI sent their polygrapher up there that did the polygraphs on the family members.

John Couey was polygraphed today, and at the end of the polygraph, he says, "You don't need to tell me the results. I already know what they are. Could I have the investigators come back in?"

And the investigators came back in. He apologized to the investigators for wasting their time.

And I'm now going to use the word that you probably waited for me to use. John Couey admitted to abducting Jessica and subsequently taking her life. I really don't have a whole lot of information for you besides that.

If anybody has any questions, I will be leaving here to go to the family. As you all are very well aware, that my security has enhanced around the residence, and it will remain there.

My PIOs and you have worked very well together. I ask that you understand this is a very tough time not only for me, it's a very tough time for the family. My PIOs will be in contact with them, and we will try to be in contact with you and orchestrate whatever we can to facilitate.

With that, again, I'm going to answer a few questions. I do want to try to stay halfway composed for you.

QUESTION: (UNINTELLIGIBLE)?

DAWSY: He's told us a general area.

QUESTION: Any luck in finding her (UNINTELLIGIBLE)?

DAWSY: This will take hours.

QUESTION: The search is under way now?

DAWSY: Pretty much so.

QUESTION: How long (UNINTELLIGIBLE)?

DAWSY: Oh, I don't know that yet.

QUESTION: When are you expecting, though (UNINTELLIGIBLE)?

DAWSY: Well, remember, this is breaking news. And I wish I could give you all the figures.

We are in the process of talking with our state attorney here. He's not going anywhere up there. He's on a no-bond, and we will bring him back once we do everything correct.

And, you know, we've talked about building a case. And this is not a time to sing anybody's praises, but I will tell you that we have built a case, a very methodical case, and I've got my man.

QUESTION: Sheriff, is there any negotiating (UNINTELLIGIBLE) that's taking death penalty off the table in exchange for cooperation of...

DAWSY: I have not be made aware of -- that would have to be cleared through me, and that didn't get cleared through me.

QUESTION: Did he give you a timeline of when he abducted Jessica, how long he held her, what he did? I mean, did he...

DAWSY: No.

QUESTION: ... sort of lay out...

DAWSY: He's probably doing that as we speak, but again, it's very early. And as the night goes on, I'll be very -- I'll be made aware of what happens.

Yes, sir?

QUESTION: Did he give you an idea of how he got in? No sign...

DAWSY: I can't go through that right now. We are now are in a major criminal case, and I'm going to shut down some of the information, understandably so, on the criminal end until I can approach the state attorney's office with all facts and figures.

QUESTION: Sheriff, have you been in touch with...

QUESTION: What brought to this change of heart...

DAWSY: I don't know, I wasn't up there. I'm just telling you, my investigators, after he finished with the polygrapher, he turned to him and said, "Bring the investigators in," and started to confess.

QUESTION: Sheriff, can you tell me, have you talked to Mark Lunsford and what his reaction might have been?

DAWSY: That was the reason why it took me so long to come out here. We were locating Mark and subsequently calling Jessica's mom to let them know -- at the same time, and then to come out and brief you. And that's what took us a little bit longer. QUESTION: What was that conversation like, sir?

DAWSY: I don't know. I mean, I just was told by my -- one of my commanders that the information has been relayed. And then I knew you guys were on a timeline and I wanted to come out to you guys.

QUESTION: About what time was the confession?

QUESTION: (UNINTELLIGIBLE) if he took her from the home? Or was she outside?

DAWSY: Again, that's the criminal end of it. As soon as I get verification, I will get back to you. I don't have -- again, let me explain. I don't have a whole lot of data. I wanted to come out and let you to hear it from me.

Thank you.

QUESTION: Sheriff, what was his demeanor when he confessed?

DAWSY: Again, I wasn't there. I mean, it must have been fairly -- I'm searching for the word. I apologize. I'm a little brain fade right now.

I guess it was cordial. You know, I don't think, you know, we had to hold him down or anything. He asked for them to come in.

UNIDENTIFIED FEMALE: One last question.

DAWSY: One last question.

UNIDENTIFIED FEMALE: One last question.

QUESTION: Are there any other cases in Citrus County now that you think we may need to re-look at John Couey because there are things that we hadn't investigated before?

DAWSY: We're going to look. We -- he had talked to us quite a while. We're going to look at a lot of things, but nothing of any major magnitude. And, you know, that's really the only questions -- I'm stumbling right now, and I apologize. I'm not...

QUESTION: Details (OFF-MIKE)

DAWSY: No, again, I apologize. I'm going to the residence. You will see me there, and I imagine I will see you there also.

QUESTION: But no other, like, sexual molestation cases that hadn't been...

DAWSY: Not that I'm aware of, OK.

UNIDENTIFIED FEMALE: Timeline for media, we're working on getting some -- putting some facts and timelines together for you.

PILGRIM: A very different statement from Jeff Dawsy, who has said, I've got my man. John Evander Couey admitted to abducting Jessica Lunsford and admitted to taking her life.

We now go to Sara Dorsey, who is on the scene -- Sara.

SARA DORSEY, CNN CORRESPONDENT: Well, Kitty, a very tragic ending to this week search for missing 9-year-old Jessica Lunsford. Just moments ago, in fact, I'll have the photographer pan over. This is the granddaughter, we are told, of Ruth and Archie Lunsford, which would make her Mark's niece, I believe. She's just hearing the news standing around with media members that John Couey did in fact admit to abducting and subsequently killing Jessica Lunsford.

Now, from here, as you can see, this area is crawling with sheriff's officials. The sheriff himself says he's heading over to this home. This area is blocked off. And we are told that now the search will go on to try to locate the body of Jessica Lunsford. Apparently John Couey told investigators a general area to look. We see that the area that is really blocked off the most is that behind the home that John Couey was staying in.

And Kitty, again to give you some background, just a few nights ago, the sheriff came out naming John Couey as a person of interest. And the reason why they did that is he was a sex offender -- a convicted sex offender. And when this case first started, the sheriff, of course, starts looking at the family and then goes out. They looked at sex offenders in this general area. John Couey, did not fall into that category, but once those sex offenders where are where they were supposed to be, they went to the whole entire county.

That's when John Couey's name came up, because he was not staying in the home he was registered in. When police started -- sheriff's officials started digging, they found out Couey had been staying in a trailer just really across the street from where Jessica Lunsford disappeared from. As investigators started digging the family member that Couey was living with lied to them about him staying there.

They later learned, of course, that they had been lied to, and came back, and got more information. They also learned that Couey left town, telling people that investigators would be looking for him. He left on a bus ticket that was in someone else's name, not his own, and fled to the Savannah area. He was picked up by authorities there, but they didn't have jurisdiction to hold him under the warrant that was out, because he was not a suspect in this case, so they didn't have a particular warrant relating to the Jessica Lunsford case to hold him on.

He was let go in Savannah, eventually they did find hem in Augusta, they have questioned him. And again, we just found out minutes ago in that press conference, he has admitted to kidnapping and killing 9-year-old Jessica Lunsford -- Kitty.

PILGRIM: All right, thank you very much, Sara Dorsey has been following this story for us in Citrus County, Florida.

And we'll be right back in a moment. Stay with us.

(COMMERCIAL BREAK) PILGRIM: Tonight Secretary of State Condoleezza Rice is in Asia. North Korea's nuclear ambitions are at the top of her agenda. And Rice will meet with senior Japanese officials in Tokyo, tomorrow. Then she's going to fly to South Korea and China. Rice wants Asian countries to help persuade North Korea to rejoin talks on it's nuclear weapon's program.

Joining me to talk about North Korea and other threats is one of the countries most distinguished former intelligence officials, Admiral Bobby Inman, a former director of the National Security Agency, and former deputy director of the CIA.

And thanks for being with us this evening.

ADMIRAL BOBBY INMAN, FORMER INTELLIGENCE OFFICER: You're welcome.

PILGRIM: You know, the trip through Asia is really to garner support for North Korea, is it not?

INMAN: It is, but it's very important that she go to Asia early. She'd been to Europe. Asia is terribly important to us in the years out ahead. As you look at the threats, North Korea becoming a nuclear power stands pretty close to the top of that list.

PILGRIM: What kind of language might we hear? And if the language has been very strong, but is it time to even be more stronger?

INMAN: She'll be direct about the need to get on with the negotiations, but she'll also, I hope, be very strong at rejecting the idea of bilateral communications. We tried that. We negotiated with them in '94, and they promptly violated it. The reason we need China to lead this, China's the only country that's got real leverage over North Korea. They can cut off their energy supply. And if China lead the discussions, the odds are high that China will oversee the actual carrying out of the agreement.

PILGRIM: Now, China's been hosting previous rounds of six-party talks. What more can they do?

INMAN: Continue to talk. But to really put the pressure on North Korea to get back in the talks. The problem here, we probably aren't going to be able to keep North Korea from having nuclear weapons. They probably already have them. The concern with North Korea is that they'll sell them, that they might sell them to terrorists. They've sold everything else that's movable that they have. It's an impoverished nation ruled by a despot, and looking for any sort of support. This is the one country, right now, that I fear might sell nuclear weapons.

PILGRIM: The great worry is that while all this talking is going on, they're getting more and more advanced, that makes more time for North Korea, which makes a considerable amount of money exporting weapons to proceed. INMAN: My personal guess is they have already some weapons in the process. But there's been a lot of work the last several years of putting together, if you detect that they are in fact trying to ship a weapon, how do you interdict it?

We've not worried about it before, but North Korea makes us worry about it.

PILGRIM: Well, she's at the spearhead of this issue. Let me ask you something that I really can't let you go without asking you. The -- John Negroponte, the U.S. Ambassador to Iraq, now head of the national intelligence director, how do you see his role changing from the way intelligence works in the past?

INMAN: He's been a user of intelligence in a variety of very senior positions. When you're looking at restructuring the whole intelligence community, where do you put the resources, and how do you judge the quality of what's being produced?

Intelligence professionals are like college professors, which I am one. You work on the things that interest you, but it may not be what the user needs. John Negroponte brings extraordinary experience at a lot of levels as a user of intelligence. And that's what I'm banking on. That with coupling with Mike (ph) -- the -- the director of the NSA, he's an old friend. And I suddenly bobbled the name, I apologize.

PILGRIM: Oh, that's all right. Thank you very much for giving us your insight into the agency, and thanks very much for being with us, Bobby Inman, retired director of National Security Agency. Thank you.

INMAN: Thank you very much.

PILGRIM: Coming up next, the high cost of so-called free trade. Why one free trader now says the United States needs to take action against China. Stay with us.

(COMMERCIAL BREAK)

PILGRIM: Now, we reported extensively here on the high cost of so-called free trade, and it includes our exploding trade deficit, millions of American jobs which are lost to cheap foreign labor markets.

And my next guest is a long-time advocate of free trade, but now he says the United States and others must take action against China for its unfair trade practices. Fred Bergsten is the director of the Institute for International Economics, and he joining us from Washington.

And thanks for being with us.

FRED BERGSTEN, DIR. INSTITUTE FOR INTERNATIONAL ECONOMICS: Good to be here. PILGRIM: You know, the great argument is America's -- American's benefit from a lot of cheap, Chinese products that come into our country and, you know, it's not so bad, because it improves cost of living. But there's an enormous down side to this, isn't there?

BERGSTEN: Well, the U.S. as a whole benefits enormously from international trade. Our economy is about $1 trillion per year better off, cheaper imports, much higher paying export jobs, much higher productivity because of international competition. And we can gain another $500 billion per year if we would go all the way to global free trade. So the overall picture is very positive.

At the moment we have a big and growing trade deficit. That's because we as a country are buying more from the rest of the world then we sell. We've got to get our own house in order to correct that, by reducing our budget deficit. But we've got to get some help from other countries. And the Chinese and others Asians are blocking the necessary adjustment by preventing the dollar exchange rate from declining to a level that would make our country more competitive in international markets.

PILGRIM: What should we do about the China problem, the manipulation of the currency, and the infringement on copy rights, the real chronic problems that we have with a trading partner like China that doesn't make for a level playing field?

BERGSTEN: Well, the biggest part of the problem overwhelmingly is the exchange rate. There are some specific trade issues like you mentioned, but the big one is the exchange rate. China pegs its currency to the dollar. As the dollar has declined over the last three years against the euro, the yen and other currencies, China has ridden the dollar down. The Chinese have actually become more competitive over the last three years by riding the dollar down. Becoming more competitive through a cheaper currency that makes their products even more competitive in world markets.

We need -- and in doing so, as a big trade surplus country, they are violating all the international rules of the game. The rules of the international monetary fund on exchange rates. The rules of the WTO on trade. So what we need to do is take a very active and aggressive lead, mobilize the international community, get the International Monetary Fund to implement its own rules, go after the Chinese and require them to re-value their currency, move it up in value 20, 25 percent, and level the playing field in that way.

PILGRIM: Get a lot tougher with China.

Let me ask you something, and it's a sort of what does it mean to us question. We have this enormous account deficit, we have rising oil prices. In fact, oil hit a record against today. Do you see problems for the American economy ahead given the mix of things that we have going? And you're a respected global economist. You certainly have the weapons at hand to decide whether we're in trouble or not.

BERGSTEN: Well, I think there is two risks to the American economy, which is strong at the moment, and has a very promising underlying prospect. But there are 2 big risks. These trade deficits could at some early point lead to a very sharp decline of the dollar exchange rate. That would push up inflation here, it could push up interest rates sharply, that would trash the stock market and it could push our economy down very sharply.

At the same time, energy prices are going up. Oil could easily go to 60, $70 a barrel, even more. And the interaction of high energy prices and a crashing dollar would be poison for the economy.

Those were the two things that happened in the 1970s. They created the term stagflation. And in the late 1970s, we in this country wound up with double-digit inflation, 20 percent interest rates and the worst recession since the 1930s.

Now, I don't think we'll have that again. But the combination of high energy prices, of big trade deficit leading to the risk of a fall in the dollar are poisonous. We need to take policy actions to prevent both of those things happening.

There is time to do it. It can be done. But we have no effective policies in either area at this time.

PILGRIM: Thank you so much for bringing it to our attention, Fred Bergsten. Thank you.

BERGSTEN: My pleasure.

PILGRIM: On a much lighter note now, our featured series "America's Bright Future." Tonight a 15-year-old with exceptional musical abilities. As a freshman in high school Steve Renko has already gained national recognition for his remarkable ability to play of drums. Bill Tucker has his story.

(BEGIN VIDEOTAPE)

BILL TUCKER, CNN CORRESPONDENT (voice-over): The sounds of Ernie Krivda's Fat Tuesday big band fill the practice hall. All but one of these musicians has been playing for decades. Steve Renko is 15- years-old. He's been playing since his father got his first drum set at 16 months. He won his first drum contest when he was eight-years- old.

STEVE RENKO, 15-YEAR-OLD DRUMMER: I play to make people happy, basically. I just like making people happy. Whatever it -- when they're clapping, dance, singing along, whatever, I like that a lot.

TUCKER: And to that end, there's the big band, there's the school band, the after-school jazz ensemble, and his personal favorite, the rock band.

RENKO: My typical day usually consists of school and then some drumming thing.

TUCKER: His most recent honor, to be selected to perform at the pre and post-Grammy celebrations in Los Angeles. Steve is a freshman at St. Ignatius High School in Cleveland, one of the top Jesuit all- boys schools in the country.

RENKO: Being a drummer, you know, it helps you learn to be disciplined. It helps me in school a lot, you know, with my homework and stuff.

TUCKER: His drum teacher knew he was something special from their first meeting.

BOB MCKEE, STEVE'S DRUM COACH: He sat down and played along with the record that sounded better than the guy on the record. I said, well, ten-years-old, that's pretty good, you know.

TUCKER: The leader of the big band he plays with agrees.

ERNIE KRIVDA, THE FAT TUESDAY BIG BAND: There are other prodigies out there, but it's a rare thing, and it's a rare thing in jazz.

TUCKER: Asked what he would do if one of his favorite bands like Slipknot or System of a Down came knocking on the door?

RENKO: I would talk to my dad first, because he's been in the business for a long time. He would know what to do.

TUCKER: His dad's answer? Education first.

Bill Tucker, CNN.

(COMMERCIAL BREAK)

PILGRIM: We wish him the best of luck.

Well, tonight's thought is on the value of creativity. We thought you would like this. And here it is. "I look forward to an American which will reward achievement in the arts as we reward achievement in business or statecraft. I look forward to an American which commands respect throughout the world, not only for its strength, but for its civilization as well."

Coming up, three of the nation's leading journalists will join me. Stay with us.

(COMMERCIAL BREAK)

PILGRIM: New developments in the Terri Schiavo case. Lawyers for the House of Representatives are tonight readying an appeal to the U.S. Supreme Court. Now, this after their first appeal was rejected by the Supreme Court of Florida. The lawyers plan to file their new appeal later tonight.

Now, the appeals involved enforcing subpoenas that a House committee issued earlier today. Those appeals were intended to prevent Terri Schiavo's feeding tube from being removed. Well, joining me now are three of the country's best journalists. From Washington, we have Karen Tumulty of "Time" magazine. From Boston, Roger Simon of "U.S. News & World Report." And joining me in New York, is Jim Ellis of "Businessweek." And thank you all for being here.

You know, I'll start with the Terri Schiavo case. And we've been watching it all day. It's just been heart-wrenching, very difficult, generating a good deal of discussion here in our room. And getting a variety of opinions.

Let's start with you, Karen, do you see this as a critical case for the country?

KAREN TUMULTY, TIME: You know, I don't know if it's -- what I think it is is a terrible tragedy for a family. And, you know, it certainly -- it touches one of our deepest, both cultural and ethical, divides. But I do find it a second tragedy that this has somehow been thrown now into the political arena.

PILGRIM: Roger, but does it not bring up issues that we should all be discussing in any case, that it's a test case?

ROGER SIMON, U.S. NEWS AND WORLD REPORT: Well, the issue that we should be discussing is the issue of living wills, that is making your wishes known before you are in a terrible accident as to whether you want your life prolonged by artificial means or not. Instead, we're discussing whether Congress is going to turn this tragedy into a farce.

Congress has no standing in this case. Once upon a time, there was a Republican, I think his name was Ronald Reagan who said government should get out of our lives. Instead, you have these farcical subpoenas, subpoenaing Terri Schiavo to come and testify even though she's been in a persistent vegetative state for 15 years. This is cruel.

PILGRIM: Well, it's a device to actually halt what's going on, which was the removal of the feeding tube. But yet it does bring up this whole issue, Roger, that you talk about of Congress versus the courts.

Jim, do you think that this is an appropriate play out of the different arguments?

JIM ELLIS, BUSINESSWEEK: I have to admit that I see this as sort of turning this into a circus atmosphere simply for political gain. I mean understand for a lot of the -- particularly the Republican base -- this is a hot-button issue that's very closely linked to the abortion issue. And this is a great way to score points, but I don't know if it does anything for the family.

This is a case that's been through the courts for quite a number of years. And it's not as if this hasn't been decided before.

Also, there's also a real question of whether the government, federal government actually has standing in this. We've already seen political games in this, in the Florida state, you know, legislature, and also with the governor there. So I really don't know what we're getting out of this other than a few politicians getting some extra votes.

PILGRIM: All right. Let's talk about another politically difficult issue: and that's the Medicaid budget. We had developments in that. And of course that has broader implications for all of American society.

Karen, let me ask you, where do you think we stand on this whole debate? Because we've had a setback this week for President Bush.

TUMULTY: Well certainly, the setback this week of course, was that the House of Representatives passed a budget that was much in line with what the White House wanted, which was fairly sharp cuts in Medicaid spending growth. The Republicans in Congress, of course, don't like them called cuts, they like to refer to them as savings. But basically it means the states will get more money than they were hoping for for Medicaid.

The Senate voted along the lines of what the governors' are asking, which is that before we start talking about specific amounts to cut or restrain the program, or whatever you want -- whatever euphemism you want to use, they want to see the program itself looked at from top to bottom. Because the fact is Medicaid, the healthcare program for the poor is essentially gobbling up state budgets.

There are a lots of states right now that spend more on Medicaid than they do on education. And something has got to be done in a systemic way to the whole system. Because otherwise, if the president is looking for a federal entitlement that's on the brink of crisis and needs an overhaul, it's Medicaid.

PILGRIM: Roger, perhaps even more important than the Social Security debate?

SIMON: It's unfortunately not more important to the president. But I think you're right, I think it is more important, simply because the real crisis is coming in Medicare and Medicaid. I mean, the crisis is here. That is the system truly on the verge of collapse, not Social Security.

But this debate, this wild debate in the Senate last night showed -- well, we all knew that the leadership of the Democrats and the leadership of the Republicans don't talk to each out, but now we learned that the House leadership of the Republicans and the Senate leadership of the Republicans don't talk to each other.

You have two houses of Congress who can't pass a budget, and are on a collision course as to what they're going to do about Medicaid. They're going to have to get together and agree on something, or else there won't be a budget. And we won't get to issues like Social Security and border security, and other matters.

PILGRIM: Jim, I'm going to let you have the last word on this. Is it as dire as...

ELLIS: Well, obviously Medicaid reform is needed. The problem we have here, the big danger for the administration at least is that they're going to lose momentum.

I mean, if they can't get the Republicans in the Senate to sort of talk to Republicans in the House on this issue, at the same time that he's having trouble getting Social Security changes through -- made basically a lot of his policies fall apart. I mean, that still leaves you with tax reform. But I'm not sure you're going to get that through this year anyway.

So it makes it look as if a lot of opportunities for the president are just going to be passed over.

PILGRIM: And are we at this kind of impasse in Congress, do you think?

ELLIS: I think that this is a lot more difficult to do, simply because the Republican governors don't want to cut Medicaid spending as much as the president would like. And unfortunately, he's going to -- they have to go back to the voters, they understand that, the president does not.

PILGRIM: Thanks so much. You've teared me right up on this one.

Jim Ellis, Karen Tumulty and Roger Simon, thank you very much for being with us. Have a great weekend.

All right. Let's do the results of tonight's poll. I was very serious poll: 7 percent of you believe the courts should decide Terri Schiavo's fat, 2 percent say Congress, 26 percent say her parents and 65 percent say her husband.

Thanks for being with us tonight. Please join us on Monday. American citizens take action to secure our border. And the Mexican president believes he's entitled to complain about it. The co-founder of the Minuteman Project will join us.

Also, the Secretary of Veteran's Affairs on a new program to give veterans returning from Iraq and Afghanistan a second chance at a new career.

And "Assault on the Middle Class." Why many senior citizens are beginning entirely new careers in their golden years.

Well, for all of us here, good night from New York. "ANDERSON COOPER 360" is next.

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