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Lou Dobbs Tonight

Intelligence Blunders; Prison Terror Probe; Bloody Iraq; Sino- Russian Military Exercise; Poor Grades for Education System; Judith Miller Still in Jail

Aired August 17, 2005 - 18:00   ET


LOU DOBBS, CNN ANCHOR: Good evening, everybody.
Tonight, shocking new evidence of critical intelligence and policy failures, some of which were hidden from the 9/11 Commission that might possibly have prevented the September 11 attacks. We'll have that story.

Also tonight, our public education system is completely failing millions of our high school graduates. Only half of those applying for college have the skills necessary to succeed.

And tonight, almost 10 percent of the Mexican population has entered the United States illegally, crossing our broken borders and taking advantage of our failed immigration policies. Tonight, we'll report to you why nearly half of Mexico's 100 million people say they want to move to the United States, and many of them say they're willing to cross our borders illegally to do so. We'll have that special report.

We begin tonight with assertions that the United States missed critical warnings about the rise of al Qaeda that could have possibly stopped the radical Islamist terrorists who carried out the September 11 attacks. Newly declassified documents say the State Department warned the Clinton administration about the rising threat from Osama bin Laden five years before 9/11.

Meanwhile, an Army intelligence officer says military attorneys refused to allow him to give the FBI information about some of the 9/11 hijackers.

Andrea Koppel, at the State Department, reports on the terror warning to the Clinton administration. And David Ensor, in Washington, reports on the military's failure to share intelligence with the FBI.

We begin with Andrea Koppel at the State Department -- Andrea.

ANDREA KOPPEL, CNN STATE DEPARTMENT CORRESPONDENT: Lou, that warning came almost 10 years ago in top-secret documents that were written by some especially sharp intelligence analysts here at the State Department. It came just about three months after bin Laden, who had been living in Sudan for about three years, was finally kicked out.

(BEGIN VIDEOTAPE) KOPPEL (voice over): Today his name and face are instantly recognized by millions around the world. But in 1996, Osama bin Laden was still relatively unknown.

However, according to newly declassified documents, in July 1996, State Department intelligence analysts warn the Clinton administration that if bin Laden moved his base from Sudan to Afghanistan, where hundreds of Arab Mujahidin received terrorist training, he could prove more dangerous to U.S. interests in the long run.

Two years later, in August 1998, bin Laden's al Qaeda network attacked the U.S. embassies in Kenya and Tanzania. And three years after that came 9/11.

TOM FITTON, JUDICIAL WATCH: The Clinton administration needs to answer some tough questions.

KOPPEL: Tom Finton is the president of Judicial Watch, a conservative legal advocacy group which first obtained the declassified documents.

FITTON: Why didn't it take stronger action against bin Laden?

KOPPEL: But following the '98 East Africa bombings, President Clinton did retaliate, ordering the U.S. military to launch cruise missiles at suspected al Qaeda training camps in Afghanistan, and stepping up diplomatic efforts to force bin Laden out. The CIA, for its part, had already established a special unit focused exclusively on bin Laden.

JOHN MCLAUGHLIN, FORMER CIA DEPUTY DIRECTOR: Bear in mind the context here was that we were at war with many other terrorist groups at that moment, including Hezbollah, for example, which until bin Laden's treachery, had killed more Americans than any other terrorist unit in the world.

KOPPEL: John McLaughlin is the former deputy director of the CIA.

MCLAUGHLIN: Bin Laden was a rising star, if you will, in the terrorist world. But our counterterrorism forces were deployed then across a very wide front.


KOPPEL: State Department analysts also offered a rather prophetic assessment, one that rings true even today. They said while keeping bin Laden on the run might "inconvenience him," they said his al Qaeda network would remain resilient -- Lou.

DOBBS: Andrea, thank you.

An Army intelligence officer today revealed new information about what he says was a major intelligence blunder one year before September 11. Lieutenant Colonel Anthony Shaffer says military attorneys blocked his efforts to share vital intelligence with the FBI about some of the 9/11 hijackers.

David Ensor has our report -- David.

DAVID ENSOR, CNN NATIONAL SECURITY CORRESPONDENT: Lou, as you say, veteran Army intelligence officer Lieutenant Colonel Anthony Shaffer says his intelligence team repeatedly tried to warn the FBI back in 2000 about a U.S.-based terrorist cell that included Mohamed Atta, the 9/11 hijacker, but that military lawyers blocked the team from sharing its fears with the FBI. Shaffer insists he also told the 9/11 Commission about it, too.


LT. COL. ANTHONY SHAFFER, U.S. ARMY: We through the Able Danger process discovered two of the three cells which conducted 9/11 to include Atta. Now -- and I -- that was, to me, significant in that they actually pulled me aside after the meeting and said, "Please come talk to us and give us more detail."

ENSOR: The former 9/11 Commission responded to the allegation last week when Shaffer first made it anonymously, saying that their memorandum of meeting with him back in 2003 "does not record any mention of Mohamed Atta or any of the other future 9/11 hijackers, or any suggestion that their identities were known to anyone at the Defense Department before 9/11."

Now, at the Pentagon today, officials are saying that Undersecretary of Defense Stephen Cambone and his staff are looking into all of this very closely -- Lou.

DOBBS: David, thank you.

Counterterrorism officials tonight are also investigating possible links between radical Islamists and a gang member in a state prison in California. Their reports, that that gang member and others were plotting to attack National Guard recruitment centers, synagogues and other targets.

Kelli Arena has the report -- Kelli.

KELLI ARENA, CNN CORRESPONDENT: Lou, this all started with a string of gas station robberies and the subsequent arrest of the two suspects. Their names are Levar Washington and Gregory Patterson.

When police searched Washington's home, that's when the FBI's joint terrorism task force was brought in. Now, officials say they found jihadist material. Sources describe that as documents with radical Islamic rhetoric, some making positive statements about Osama bin Laden.

They also found what some investigators describe as a possible target list. Law enforcement sources say that list included, as you said, three National Guard facilities in the Los Angeles area, as well as the Israeli consulate, and two synagogues. It also had a reference to the date September 11. Lawyers for both those men deny any terror connection. Patterson's lawyer says that he's hoping the fact that his client is Muslim isn't leading investigators to jump to conclusions.


WINSTON MCKESSON, LAWYER FOR GREGORY PATTERSON: This is a country where we honor the bill of rights. Particularly, the First Amendment talks about the freedom of religion. And I would hope we're not jumping to conclusions just because these young men may be sympathetic to the Muslim faith to think that they're necessarily terrorists.


ARENA: The investigation has led to the arrest of at least one other man, a Pakistani national. Government sources say that investigators are also interviewing two California inmates. Investigators believe that those men may have information about jihad recruiting within prisons.

Now, officials aren't commenting publicly yet, Lou. Sources say that they won't until they're really clear about exactly what they're dealing with.

DOBBS: Thank you very much. Kelli Arena.

The insurgency in Iraq continues to accelerate. Two more of our troops have been killed. One in Baghdad, the other in Mosul. And nearly 50 Iraqis were killed today in a series of car bomb attacks in the Iraqi capital.

Barbara Starr reports from the Pentagon.


BARBARA STARR, CNN PENTAGON CORRESPONDENT (voice over): It was one of the most vicious and coordinated suicide car bomb attacks in Baghdad in weeks. First, a car bomb detonated at the main bus terminal. Then, as Iraqi police arrived, another suicide car bomb.

Casualties were taken to a nearby hospital, where a third bomb exploded. At least 43 Iraqis killed, 88 wounded.

At Fort Bragg, North Carolina, 700 paratroopers from the 82nd Airborne Division have unexpected orders for Iraq. The highly-trained Combat Infantry Unit will now provide prison security. The U.S. is opening a new facility northeast of Baghdad, in part because the once notorious Abu Ghraib Prison is near capacity.

CNN has learned military commanders this week are reviewing recommendations to temporarily increase the number of troops in Iraq for upcoming elections. No final decisions have been made, but the proposals call for adding 20,000 troops to the current 138,000 on duty. That could be done by keeping some troops in place longer than planned, sending some troops already earmarked to Iraq earlier than expected. Or ordering fresh troops into battle.

The chairman of the Joint Chiefs of Staff was in Baghdad to discuss the fragile security situation.

GEN. RICHARD MYERS, CHAIRMAN, JOINT CHIEFS: And I assured the president, President Talabani, I assured him that, "The United States will stay with you, with the Iraqi people, until this mission is finished."


STARR: Now, Lou, Defense Secretary Donald Rumsfeld says that delay in drafting the Iraqi constitution is, in his words, not helpful. The Pentagon very strongly feels keeping political progress on track will be crucial to ending the insurgency and getting Iraq back on its feet -- Lou.

DOBBS: Barbara Starr. Thank you very much.

Still ahead, new fears that the illegal immigration crisis in this country could escalate dramatically. It turns out that half of Mexico's population wants to come to the United States.

And new details tonight of how British police bungled a surveillance operation against radical Islamist terrorists and killed an innocent Brazilian citizen.


DOBBS: There are heightened concerns tonight about the escalating illegal immigration and border security crisis that squarely faces this country. Now as many as 50 million citizens of Mexico say they want to come to the United States, and many of them say they're willingly ready to cross our border illegally.

Casey Wian reports.


CASEY WIAN, CNN CORRESPONDENT (voice over): Nearly half of Mexico's 106 million people want out of their country. Two surveys of Mexicans conducted in February and May of this year by the Pew Hispanic Center found 41 and 46 percent would go to live in the United States if they had the means and opportunity. Incredibly, 21 percent, or more than 20 million people, say they would be inclined to cross the border illegally.

GARY HUFBAUER, INST. FOR INTERNATIONAL ECONOMICS: There's a huge gap there in income, and, of course, America seems like the promised land to poor Mexicans, but even to middle-income Mexicans.

WIAN: In fact, the survey challenges the popular notion that only the poorest Mexicans flee to the United States. The desire to leave Mexico was almost identical across income groups.

STEVEN CAMAROTA, CENTER FOR IMMIGRATION STUDIES: What the survey showed is that educated and uneducated people both want to come to the United States, which is important, because it suggests that immigration to the U.S. isn't just an act of desperation. And it isn't motivated by just wage differentials. It's motivated by lots of things.

WIAN: Including the desire to escape rampant corruption, inefficient bureaucracy, and escalating violence, especially along the border. On that front, Mexican President Vicente Fox reacted to the recent declarations of states of emergency by the governors of New Mexico and Arizona.

VICENTE FOX, MEXICAN PRESIDENT (through translator): My call to the United States government, whether it's state or the federal government, instead of criticizing we should make suggestions. Instead of working each side on their own, we should work together. That's the only way we will be able to win.

WIAN: But a scheduled meeting Wednesday between Secretary of State Condoleezza Rice and her Mexican counterpart was canceled.

SEAN MCCORMACK, STATE DEPT. SPOKESMAN: This was through mutual -- mutual agreement. It had nothing to do with policy matters.

WIAN: Both the United States and Mexico say their relationship remains strong. Still, news this week that Mexico's economy weakened in the second quarter is another blow to the Mexican people. And another incentive to cross the border.


WIAN: Now, Mexico's economy is struggling, even though oil prices are at record highs. Instead of tapping into its massive oil reserves, Mexico has become increasingly dependent on money its citizens send home from the United States -- Lou.

DOBBS: Increasingly dependent. Those remittances now their number one source of capital from abroad, eclipsing their oil industry in Mexico, Casey. This is an extraordinary...

WIAN: Approaching $20 billion.

DOBBS: I'm sorry?

WIAN: And approaching $20 billion a year.

DOBBS: And this is an extraordinary survey put out by the Pew Hispanic Center. I don't know of another example in which nearly half of the people of a country would say they're willing to -- willing -- they're eager to leave their home of birth to migrate. It's extraordinary.

WIAN: It really is. And it does not bode well for Mexico's future, because overwhelmingly, the people who want to leave Mexico tend to be younger. And they, you would think, would be the best hope for economic turnaround in Mexico.

Vicente Fox ran as a reformer, and it's pretty clear he hasn't made much progress in reforming his economy -- Lou.

DOBBS: He's reformed little. He is -- he focuses on U.S. policies and Mexican citizens in this country, while ignoring the plight of just about 80 percent of his population. The people of Mexico, your heart has to go out to them. They're confronted with incompetent government, corrupt government, and a failed economy when we thought it had so much promise under NAFTA.

It's extraordinary, and it suggests the failure of our policies toward Mexico, which should be helping the working man and woman in Mexico rather than incentivizing illegal immigration for the exploitation by U.S. employers.

Thank you.

WIAN: And a lot of people say there's not much historical precedent for change like that as needed in Mexico to come from the outside. So people are suggesting that there's not much the U.S. can do, that it has to come from within Mexico -- Lou.

DOBBS: One certainly hopes, and one hopes soon. Casey, thank you. Casey Wian.

In Arizona tonight, four Mexican illegal aliens are under arrest in a massive marijuana bust. Agents say those illegal aliens were cultivating a three-mile-wide marijuana growing operation in one of Arizona's national forests. Agents have dug up thousands of plants so far. They say it will take days for them to finish.

Police are searching for other suspects. Governor Napolitano of Arizona of course this week declaring a state of emergency because of the immigration crisis and border security crisis along the state's southern border with Mexico.

Today's quote of the day comes from Mexican government spokesman Ruben Aguilar. He says more Mexicans should be allowed into the United States to live and work because of a surge of drug gang violence in Mexico. He says, "The security situation should bring advances more quickly in a migration accord, an accord that allows a legal flow, an orderly flow with respect for human rights that assures the security of the United States as much as Mexico."

An astounding piece of reasoning, an astounding request. Aguilar says, however, Mexican national security is not threatened by rising drug gang violence along our southern border. That, despite the fact that more than 800 Mexican citizens have been killed in drug gang violence just this year.

A battle is brewing over illegal aliens who work as day laborers in communities all around this country. Tonight, in Herndon, Virginia, the town council holds its second day of hearings on whether taxpayer dollars should be used to build a day laborer center for illegal employees and workers. The issue has sparked a fierce local and even national debate over whether that is an appropriate use of taxpayer money. Imagine that.

Lisa Sylvester reports from Herndon, Virginia.


CHRIS CORE, RADIO HOST: Bosses make the rules. I don't...

LISA SYLVESTER, CNN CORRESPONDENT (voice over): WMAL 630 radio is tracking the illegal immigration debate. When callers were asked to dial up Herndon's city hall to discuss the proposed day labor center, there were so many calls it jammed the switchboard. Radio host Chris Core says it's not just a small town issue, it's a national concern, with many U.S. cities facing the same problem.

CORE: This whole issue about Herndon is simply because the line has been drawn. And, you know, it isn't Herndon in particular. I know there are lots of places like this. It's just the fight is in Herndon.

SYLVESTER: The day laborer center would cost taxpayers $170,000, and the primary beneficiaries would be transient workers, many of them illegal aliens. The workers now gather outside a 7-Eleven store by the dozens, swarming any vehicle looking to hire.

MAYOR MICHAEL O'REILLY, HERNDON, VIRGNIA: There's a national debate or issues dealing with immigration, but we're just trying to take care of what we consider to be a local problem.

SYLVESTER: Herndon residents say the public loitering is driving down property values and raises safety concerns.

AUBREY STOKES, HERNDON AREA RESIDENT: The proposed site is located very close to where I live. And there's very valid fear that a lot of pedestrian traffic would be going through my neighborhood to get to the proposed site.

SYLVESTER: The issue has the attention of national groups, including Judicial Watch. The organization is threatening to sue the town if the center is approved.

FITTON: The taxpayers of Herndon are forced to subsidize the illegal hiring of illegal workers through this plan. They'll be using public property and using taxpayer funds. And Judicial Watch believes that's wrong.

It's also illegal. The town can't do that.

SYLVESTER: The town council heard from dozens of citizens at its hearing Tuesday night. So many that the hearing was carried over for a day. With more than 60 speakers still slated to give their opinions, Herndon officials are looking at another very late night of debate.

Lisa Sylvester, CNN, Herndon, Virginia.


DOBBS: Up next here, shocking testimony at the sentencing hearing for the confessed BTK killer. We'll have the very latest for you from Wichita, Kansas, next.

And then war games, off China. China and Russia have teamed up to send a strong message to the United States. That message and our special report are next.


DOBBS: More than 30 years after his killing rampage began, the sentencing hearing for Dennis Rader began in Wichita, Kansas. Prosecutors vowed to close the chapter and to seek the harshest sentencing possible for the self-confessed BTK serial killer.

Jonathan Freed is in Wichita, Kansas, and has the latest -- Jonathan.

JONATHAN FREED, CNN CORRESPONDENT: Lou, I was in that courtroom today when this hearing got under way, and I can tell you that some of the most intriguing things that happened were not what was seen on camera. Even before Dennis Rader walked into the courtroom, Steven Relford, who is the son of Shirley Vian, who was murdered by Rader in 1977, was standing up. He was the only person standing in the courtroom with his gaze fixed very solidly, very determinedly on the door that he knew Dennis Rader was about to walk through.

And when Rader walked through that door, Steven Relford just bored in on him with his gaze and refused to look away. It wasn't clear whether or not their eyes met, but Relford just stood there. And he didn't sit down until the judge walked in and instructed the entire courtroom to be seated.

Relford at that point had no choice. And then he still sat forward on the edge of his seat and just kept looking at Dennis Rader. From his vantage point, Lou, he would have seen him in profile.

Other things that were going on were the Otero children. The Otero family, father and mother and two children, were the first murders attributed to BTK, Lou, in 1974. Charlie, Carmen and Danny, the Otero children, who are grown now, of course, were in the courtroom. And they were quite composed at the beginning, but they just gave way to tears when close-ups, photographs of their parents and of their siblings with marks on their necks, and other wounds, were shown on a very large screen in that courtroom.

Now, Dennis Rader said that he told police that he had no remorse. Police officers, Lou, said that he showed no remorse whatsoever, and that Rader even at one point, Lou, described himself as a monster.

Back to you.

DOBBS: Thank you very much, Jonathan. When do we expect the sentencing to actually take place?

FREED: Well, it could happen tomorrow, depending on the pace of how many people are left to go. We still need to hear from the defense.

They are suggesting that Rader himself may say a few words. It's called allocution.

They say here in Kansas it's very unusual in this jurisdiction in Wichita for a defendant not to say a few words at his sentencing. Then the families would have a chance to interject as well and make their victim impact statements. It could be tomorrow, perhaps as late as Friday.

DOBBS: As the prosecutor put it, Jonathan, perhaps there can be closure of this chapter of this grotesque, tragic episode finished and resolved for the families, one hopes.

Jonathan Freed in Wichita. Thank you.

Coming up next here, fatal mistakes in the London subway. A new report points the blame at London police in the death of an innocent man. We'll have that report.

And wasted minds. Many high school graduates are shockingly unprepared for college. We'll have the full story next.


DOBBS: New details tonight of an astonishing series of mistakes by British police who were hunting radical Islamist terrorists, mistakes that led to the death of an innocent Brazilian man and an apparent police cover-up. A leaked report shows that London police repeatedly shot the Brazilian citizen in the suspicion that he was a suicide bomber, although he was not even trying to flee.

Ray Stewart of ITN reports from London.


RAY STEWART, ITN CORRESPONDENT (voice over): The documents obtained by ITV News showed that Jean Charles de Menezes' violent death was caused by basic police errors. And it's the man in charge of the police involved, Sir Ian Blair, who is now under the spotlight. Did the Metropolitan Police chief try to cover up the reasons why an innocent man was shot dead?

The catalog of mistakes started here during a surveillance operation at the block of flats in south London supposedly containg terror suspects. One officer was supposed to film suspects if they left the building, but he didn't get a picture of Mr. de Menezes when he came out the front door. Why? He was otherwise engaged.

"As he walked out of my line of vision, I checked the photographs and transmitted that it would be worth somebody else having a look. I should point out that as I observed, this male exited the block. I was in the process of relieving myself."

"At this time, I was not able to transmit my observations and switch on the video camera at the same time. There is, therefore, no video footage of this male."

STEWART: If he had managed to get a picture of Jean Charles, other officers may have realized he wasn't one of the men they wanted. Instead, he was followed to Stockwell tube station, where further mistakes were made. Initial police reports suggested he was wearing a suspiciously bulky jacket, that he jumped the ticket barrier and ran onto the train. We now know none of that is true. One officer had Mr. De Menezes under control before he was killed.

UNIDENTIFIED MALE: I grabbed the male in the denim jacket by wrapping both my arms around his torso, pinning his arms to his side. I then pushed him back onto the seat where he had been previously sitting. I then heard a gunshot very close to my left ear, and was dragged away onto the floor of the carriage.

STEWART: Several shots later Jean Charles de Menezes was dead. But why doesn't this tally with what the police claimed at the time? Here's what the police commissioner said soon after the shooting.

IAN BLAIR, LONDON POLICE COMMISSIONER: We have to consider what would have happened if these officers had not shot. And that man had been a suicide bomber and got on the tube.

STEWART: The reality, as we know now, is Mr. De Menezes was not a suicide bomber. He was, in fact, an innocent victim.

BLAIR: The information I have available is that this shooting is directly linked to the ongoing and expanding anti-terrorist operation.

STEWART: The reality is that the building Mr. De Menezes lived in was under surveillance. The police had the right address, but the wrong man.

BLAIR: As I understand the situation, the man was challenged and refused to obey police instructions.

STEWART: The reality we now know is that no challenges were issued, and no instructions given by officers. And it's now emerging that Sir Ian Blair is pleading to the government to let the police investigate the shooting rather than outsiders. The home secretary gave a very firm no.

Ray Stewart, ITV News.


DOBBS: One of the British terror suspects who fled to Italy after the second wave of bombings in London will be extradited to Britain. An Italian court today ruled that Hamdi Isaac must be returned to Britain within 35 days. He will stand trial on charges he participated in the attempted bombing against London's mass transit system on the 21st of July. In the West Bank, a Jewish settler grabbed a rifle from an Israeli guard and shot and killed three Palestinians. The man was arrested. The shooting comes as Israeli soldiers in Gaza were forcibly removing hundreds of settlers who had refused to leave. Guy Raz reports.


GUY RAZ, CNN CORRESPONDENT (voice-over): The moment both soldiers and settlers dreaded, now under way in earnest. Struggles were expected, so was the resistance and the arrests. But in the end, those who chose to stay and resist were no match for the thousands of Israeli soldiers.

Some burnt barricades, a futile attempt to stop Israel's military machine. But many simply left with anger, with heavy hearts, but they didn't struggle.

Few in the settlement have come to terms with this process, but all have now accepted the reality of disengagement.

UNIDENTIFIED MALE: For 30 years we built and built and built. And one day they come and take it all. For what?

RAZ: Svika (ph) spent the day inside the synagogue, where hundreds of defiant youngsters milled about waiting for the inevitable evacuation. Today, the prime minister was called a Nazi, by the very same people who once celebrated him.

Hurt me, the prime minister appealed in a televised news conference. I am responsible for this. I will take the blame.

The scenes were dramatic on the first day of evacuation. But surprisingly, the army says things were calmer than expected with an estimated 60 percent of the settlers already out.

(on camera): For now, it's still a low-intensity standoff. But an emotional test for both soldiers and settlers, brothers, now opponents as well.

Guy Raz, CNN, Neveh Dekalim Settlement, Gaza.


BLITZER: In the Pacific, China and Russia are displaying their rising military might in their first-ever joint military exercises. The war games involve 10,000 troops, and they are meant to send a clear message to the United States. Stan Grant reports.


STAN GRANT, CNN CORRESPONDENT (voice-over): The ghosts of China's military past. The faces of old leaders gaze down on weapons of the cold war. This museum outside Beijing, a graveyard of old guns, planes and missiles. Yet China's growing economic strength is building military muscle. China's defense spending up 13 percent, now $30 billion U.S. dollars. The Pentagon claims the real figure more than double that, $65 billion.

The aim, to breathe fire into the dragon. In the words of China's premier Wen Jiabao, insuring the army is capable of winning any war it fights.

Already the biggest army in the world, China is building weapons to fight in space, or on the sea. A growing fleet of nuclear and diesel submarines, more than 2500 combat aircraft, boost in communication and command systems, smarter missiles. The Pentagon reporting more than 700 short-range missiles pointing at Taiwan, China's biggest flash point.

Now China testing its strength alongside old foes Russia: the first-ever joint exercises involving up to 10,000 troops.

(on camera): This is a Soviet MIG jet fighter from the cold war era. It's still the case today that China is one of Russia's best customers when it comes to military hardware. One of the reasons for having the joint exercises is a chance for China to go shopping once again.

(voice-over): China has been buying weapon-carrying ships and submarines, and adding to its air power with new Russian fighter bombers. U.S. Defense Secretary Donald Rumsfeld already has raised concerns about China's rush to arms. But some Chinese analysts say the U.S. is wrong to see a threat.

JIN CANRONG, RENMIN UNIVERSITY OF CHINA: China is a country now run by technocrats, not revolutionary generation.

GRANT: The leaders and the weapons of the Cold War may be museum pieces, but some fear a new arms race is only just beginning.

Stan Grant, CNN, Beijing.


DOBBS: China and Russia are calling their joint military exercises peace mission 2005. The Pentagon is closely watching these maneuvers, and whatever message China seeks to send, they're receiving.

"The Washington Times" reports the U.S. pacific command will be using EP-3 surveillance aircraft along China's coast to monitor the exercises, and two U.S. Navy surveillance ships have already moved into the region.

Russian president Vladimir Putin is showing off his own military capabilities. The Russian leader and former KGB agent today flew in a supersonic strategic bomber and helped launch a cruise missile over the arctic. Yes, there he is in his red helmet. The training mission came on the first day of the Moscow International Air Show. The U.s. Air Force is also participating in the event.

Coming up next here, "Wasted Minds:" a shocking new report finds that many of our teenagers are grossly unprepared for college, as many as half taking the country's leading college entrance exams.

And then Judith Miller, in jail for six weeks for protecting her confidential sources in the White House CIA leak. Paul Steiger, the managing editor of "The Wall Street Journal" will join me here next. Stay with us.


DOBBS: An astonishing indictment tonight of this nation's education system. According to a new study by ACT, the nation's leading college testing firm, roughly half of this year's high school graduates do not have the reading skills necessary to succeed in college. And shockingly, their math and science preparation is even worse. Bill Tucker reports.


BILL TUCKER, CNN CORRESPONDENT (voice-over): They have their diplomas, but most of the high school graduating class of 2005 are not ready for college. Only half of the students taking the ACT college admission test were found the reading comprehension skills necessary for college, less than half had adequate math skills, and barely one- quarter are ready when it comes to college's level science.

MICHAEL PETRILLI, THOMAS B. FORDHAM FDN.: You know, we've known this for years and years. It's like someone's pulling a fire alarm but nobody's moving. This is very serious. We have greater and greater competition from around the world. Other countries are taking academics very seriously. They're making sure that their students are taking rigorous courses, and we're simply not doing enough.

TUCKER: Only 56 percent of high school students take or exceed the recommended core curriculum for college-bound students, a number that has remained consistent for the last decade. Students, their parents and our schools are failing to recognize that we are now locked in a global competition. That failure has consequences.

PAUL PETERSON, HARVARD UNIVERSITY: There is a shortage of talent in the United States today of top-level talent. There's a big shortage. We need to bring people in from around the world. And now after 9/11, with all the concern about passports and visas and all of that, it's getting harder to bring people in from abroad, and so business is feeling very pinched. It's really time for our educational system to step up.

TUCKER (on camera): And one other trend worth noting, more women than men are making plans to attend college. And Lou, that is a trend that is confirmed by more testing services, the ACT And SAT.

DOBBS: Paul Peterson at Harvard just saying something that's remarkable, because it really betrays a suggestion that our institutions of higher education have been depending on foreign students to make up for the failure of American students.

TUCKER: Well, I think what Paul is trying to say there is ...

DOBBS: I know what he's trying to say, but that's what he's portraying is that expectation. So now, because we have issue, we'd better start looking to ourselves.

TUCKER: Exactly.

DOBBS: One would hope. Bill Tucker, thank you.

We'd like to know what you think about this shocking new data on the state of our educational system, our public educational system. Do you believe Congress, state and local politicians are doing enough to address the urgent educational needs of this country?

We know the roles of educators and parents are critical, as well as the students themselves. But tonight let's just focus on Congress, state and local politicians, whether they're doing enough to deal with this urgent, educational crisis.

Cast your vote at We'll have the results later here.

And now joining me to discuss ACT's latest report card on the state of our educational system, is Dick Ferguson. He is the chief executive officer of ACT, joining us from Cedar Rapids, Iowa. Dick, good to have you here.


DOBBS: As Bill Tucker reported, this is astonishing that fewer than half of those taking this test are likely to succeed in college. How concerned are you?

FERGUSON: We are deeply concerned by the issue that we're facing as a nation, Lou. The data that we have, are predicated on the actual performances of students over the last several years, as we look to their readiness to take the entry-level college courses that most freshmen students do take.

There is some good news. The good news is that we see increases in the number of minority youngsters who are aspiring to college, and certainly increase in students as a whole looking to attend college. So that is a good thing. But we need to get them prepared for the work that they're going to face when they get there.

DOBBS: Absolutely. And to be clear, it's possible to infer from what you just said, that those minority students are not performing as well as they have in the past. That's not really the case, is it?

FERGUSON: No, it's not. Actually we have seen some increases in the performance of our minority youngsters, increases in our Hispanic population of ACT tested students, and their scores have increased over time. DOBBS: And men and women in this country have traditionally tested fairly even. But men testing higher in science and women in, if you will, verbal, does that remain the case?

FERGUSON: That does remain the case to this day. And that, of course, reflects course-taking behaviors on the part of students. You know, our really serious problem, Lou, has mostly to do with the absence of the course-taking in math and science in the high school years.

DOBBS: Kids running from math and science in point of fact?

FERGUSON: We're simply seeing a decline in the number of students who are taking those higher courses which are so key to their readiness for college and ultimately, their readiness for careers in those high-tech fields and so forth where there are great opportunities in the future.

DOBBS: Dick, many -- we've reported on this broadcast constantly, and for years, that we're not preparing our young people with educations in mathematics and science. But when you talk about reading comprehension falling to the levels that you are reporting and describing here, that's also extraordinarily troubling.

We hear lots of debates about the No Child Left Behind, about the importance of various programs in public education. But public education in this country, based on what you're saying, is literally failing a generation of our young people.

FERGUSON: We have a big challenge ahead of us. And it's not a universal one. We have school districts that are performing extremely well, doing the work that they need to do. There are those that lack the resources to do their job in an effective manner. So we clearly know we have our work cut out for us.

Now, the federal government, with its No Child Left Behind program, is taking a step to improve youngsters' performance in our K through eight sector. And we're seeing results from that. What we hope is ultimately that that will in fact pay off in the future. That will require, however, that youngsters make the right decisions when they're in middle school and moving into high school.

DOBBS: And have the right teachers with the necessary backgrounds in science and mathematics to teach compellingly those subjects to young people, right?

FERGUSON: And as you know, that is a major issue in the fact that we have unfortunately, far too many young people who are in classrooms, particularly in the math and science areas, where often the teachers are not certified in those fields. That is a challenge that our schools face. And we're going to have to help them with that.

DOBBS: Well, thank you for helping us understand the dimension of the problem, and focusing the national attention upon this critical issue. Dick Ferguson, the CEO of ACT. Thanks for being here. FERGUSON: Thank you, Lou.

DOBBS: When we come back, "New York Times" Pulitzer Prize winning reporter Judith Miller remains in jail tonight for a story she didn't write, for protecting the confidentiality of sources she promised to protect.

I'll be talking to the managing editor of the "Wall Street Journal" who is fighting for a shield law for journalists who are protecting their confidential sources and the First Amendment. Stay with us.


DOBBS: Tonight Judith Miller is entering her seventh week in prison. The Pulitzer Prize winning reporter has now been in jail for 42 days for protecting her confidential sources in the White House CIA leak case. My guest tonight recently led a delegation of journalists to visit Judith Miller in prison. Paul Steiger is the chair of the board of directors of the Committee to Protect Journalists and, of course, the managing editor of the "Wall Street Journal." Paul, good to have you here.


DOBBS: What is -- how does Judy feel? What is your sense of the way she is handling this very difficult situation?

STEIGER: Well, you know, I saw her two weeks ago, Lou, and we could see her through the plastic glass, and talked to her one at a time through a phone. And, you know, she was high energy, positive, you know, no sign of despair or depression. But, you know, she's in a jail. She's brushing her hair with a toothbrush, because you can't have a hair brush, because it might be used as a weapon. So she's in jail.

DOBBS: It is a remarkable situation that the only person in jail, in connection with what is now just about a two-year investigation of the CIA-White House leak case is Judy Miller. How do you react?

STEIGER: Well, it's an irony. It almost -- it feels a little bit unAmerican that someone is in jail to make them talk, and to make them talk about confidential sources. And, you know, we sort of glibly toss around the notion of confidential sources. But what this means is, if I give you my promise that I won't reveal your name, you can give me important information, as in the case of Deep Throat.

DOBBS: Or the Pentagon Papers. Or any number of critically important stories.

STEIGER: Absolutely. So it's not about journalists, it's about the public getting access to a flow of information that can be very critical. DOBBS: You and I both know there is little there -- no, there is no profit whatsoever in trying to explain that a journalist who has chosen in this case, Judy Miller, to protect her confidential sources, and to bear the responsibility and the punishment for defying the judge demanding those confidential sources. It's a difficult, difficult situation. It has to -- it is an act of great courage on the part of Judy Miller, no matter what anyone thinks from the left or right of this.

But what it seems clear is people have forgotten, this is about the First Amendment. The public's right to know, as you say, not whether you are a liberal or conservative, a Republican or Democrat with an ax to grind ideological in the case of the White House CIA leak case. But that's really the way it's breaking, isn't it?

STEIGER: Yes. Well -- and I think, you know, I have friends both on the right and the left who, you know, the people on the left want her to talk because they think she might provide evidence against Karl Rove, who is their bete noire. And I have friends on the right who feel there's much too much leaking. And anytime you can put a journalist in jail, that's good.

But, you know, I think more people are starting to understand, at least I hope so, that it's important to protect sources, to protect the flow of information.

DOBBS: As the head of the Committee to Protect Journalists, typically you're worried about journalists who are being held in prisons or killed, or tortured, in countries all around the world, but not in this country. Does this just feel entirely and completely alien to you?

STEIGER: Well, it is an anomaly, as you know. The Committee to Protect Journalists was founded 25 years ago with the idea of trying to extend America's press freedoms abroad where people regularly -- journalists are regularly locked up for doing their jobs, whether it's Cuba or China or Zimbabwe. This is something that we've tried to make a case against. It becomes more difficult when folks in those countries can say well, what about you, you're locking up journalists, too.

DOBBS: Many organizations, journalists in this country, but particularly the media organizations, the corporations themselves, are they doing enough to bring attention to what is being done to Judy Miller and per force, that treatment to the First Amendment?

STEIGER: I -- I mean, I think that media organizations are trying. I think that there's a concern, you know, not to be seen as doing special pleading for our own interests, not to overplay the story.

But I also think that there have been, you know, regular visits to Judy, for example, to dramatize her case. There have been editorials. There was just yesterday in the "New York Times," an op ed by Senator Dole who was one of the sponsors of the bill that this investigation is based on. DOBBS: Federal shield law.

STEIGER: Right. No, not the federal shield law. He was one of the sponsors of the legislation protecting CIA agents from disclosure, saying he doesn't think there's a case here.

DOBBS: Well, not only does he not think there's a case, he thinks it's a mistake to treat the First Amendment and Judy Miller and any other journalist in this way which he had made clear in the editorial, for which I give him great credit.

But the corporation that is these -- we tend to separate the corporation and the media organization, the journalists. Do the corporations themselves have a role here?

STEIGER: You know, I think that the role of the journalistic media organizations is to try to be sure that the case is covered fairly. But what I think is important now is for the prosecutor who's had a long time to pursue this case...

DOBBS: Pat Fitzgerald.

STEIGER: show his hand, and to make a case. And to see what he can do, you know, without Judy's testimony.

DOBBS: Paul Steiger, as always, well said, thanks for being here.

STEIGER: Thank you, Lou.

DOBBS: Still ahead, we'll have the results of our poll. The question, "do you believe Congress, state and local politicians are doing enough to address the urgent educational needs of this country?" We recognize parents, educators, also of course, and students themselves have a critical role, but let's focus on Congress, state and local politicians for tonight. We'll have the results right after this. Stay with us.


DOBBS: Now the results of our poll tonight. 96 percent of you say Congress, state and local politicians are not doing enough to address the urgent educational needs of this country.

Thanks for being with us tonight. Please join us here tomorrow. Making English the official language. More Americans than ever don't speak the language of our country. We'll report on the rising movement to make English our official language.

And then, students from Saudi Arabia in this country attending class, segregated class, women and men separated because the funding for that particular class comes from Saudi Arabia. We'll tell you about the public university that is allowing Saudi Arabia to get away with it. We'll have that special report. And the latest on an American town divided over whether to provide day laborer sites at taxpayer expense for illegal aliens. Please join us here tomorrow. Thanks for being with us tonight. Good night from New York. "ANDERSON COOPER 360" starts right now.