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Lou Dobbs Tonight

General Wants More Troops in Iraq; Senate, White House Working on Benchmarks for Iraqi Government; Bush Under Fire Over Iraq

Aired May 11, 2007 - 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, rising anger after Democrats sell out middle class Americans on the issue of so-called free trade.
We'll have a special report.

Also, apprehensions of illegal aliens on our southern border. The apprehensions are down. The Bush administration is claiming credit and ignoring reality again.

And firefighters are battling a huge fire on an island off of the California coast. Thousands of acres have been scorched. Thousands of people have been evacuated.

We'll have a live report.

ANNOUNCER: This is LOU DOBBS TONIGHT, news, debate and opinion for Friday, May 11th.

Live from New York, sitting in for Lou Dobbs, Kitty Pilgrim.

PILGRIM: Good evening, everybody.

We begin tonight with Iraq, where a top U.S. commander tonight says he needs more troops to fight insurgents. The commander, Major General Benjamin Mixon, leads troops in Diyala province, north of Baghdad.

Meanwhile, President Bush is facing rising concern in his own party about the war in Iraq and other issues. The president is responding to that criticism by showing more flexibility in his dealings with Congress.

Jamie McIntyre reports on General Mixon's urgent plea for more troops.

Andrea Koppel reports in the latest developments in the political battle over war funding.

And Ed Henry reports on the president's struggles to regain the political initiative.

We turn first to Jamie McIntyre -- Jamie.

JAMIE MCINTYRE, CNN SR. PENTAGON CORRESPONDENT: Well, Kitty, no sooner had Major General Benjamin Mixon started a security crackdown in Diyala province, that he realized he was undermanned. (BEGIN VIDEOTAPE)

MCINTYRE (voice over): As the U.S. military puts the squeeze on insurgents in Baghdad, they simply pop up in other parts of Iraq where there is less American security. Diyala province, just northeast of Baghdad, is a prime example.

On Thursday, one U.S. soldier was killed, nine others wounded on patrol. Part of a recent spike of violence that has the local U.S. commander calling for another round of reinforcements.

MAJ. GEN. BENJAMIN MIXON, MULTINATIONAL DIVISION North: We have put additional forces in there over the last couple months -- an additional Stryker battalion. But I'm going to need additional forces in Diyala province to get that situation to a more acceptable level.

MCINTYRE: General Mixon's request for backup has gone up the chain to Lieutenant General Raymond Odierno, who will have to decide whether fresh troops coming in to Iraq this month will complete the U.S. troop buildup should be dispatched to Diyala, or if he will need to shift troops from Baghdad or elsewhere in Iraq. One thing is for sure, there are no additional forces from the U.S. And despite Pentagon assurances that Iraq's 125 battalions are growing more capable by the day, none of them are up to the job either.

Speaking at Cambridge University in England, Iraq's president, Jalal Talabani, conceded U.S. troops will likely be needed well into 2009.

JALAL TALABANI, IRAQI PRESIDENT: We hope that the Congress will review this decision and help American army to stay until Iraqi army will be -- will be -- will be ready to replace them.

UNIDENTIFIED MALE: When might that be?

TALABANI: I think within one -- half -- two years.

(END VIDEOTAPE)

MCINTYRE: In just a few days, the final wave of the 30,000 additional U.S. troops will begin flowing into Iraq. By mid-June, the U.S. should be at full strength. One general told CNN the reason there is really no additional troops that could be sent to Iraq is that every Army soldier is either there, going there, or coming back -- Kitty.

PILGRIM: Jamie, you have said that not one of the Iraq's army 125 battalions is up to the job. Now, just how long will it take for the Iraqi army to be fully capable of fighting the insurgents without the U.S. support?

MCINTYRE: Well, right now, of the over 100 brigades that the -- battalions, rather, that the Iraqi army has, 10 are judged to be really self-sufficient. But they are not available to be plugged into Diyala province, and it's not clear that if they were, they could operate without significant U.S. help in that area. So, it's really unclear when we're going to be able to see an Iraqi army that can stand on its own. You heard President Talabani say he thinks it's going to be two years.

PILGRIM: All right. Thanks very much.

Jamie McIntyre.

Four more of troops have been killed in Iraq. One of them in Diyala province, just as Jamie McIntyre reported. Thirty-five of our troops have been killed in Iraq so far this month, 3,386 of our troops have been killed since the war began. 25,245 of our troops have been wounded, 11,270 of them seriously.

As the violence continues in Iraq, the political battle over funding the war is escalating in Washington. House Democrats want to restrict the funds available for the war. Senate Democrats have a different view. They are trying to reach a compromise with the White House.

Andrea Koppel reports from Capitol Hill -- Andrea.

ANDREA KOPPEL, CNN CONGRESSIONAL CORRESPONDENT: Kitty, that compromise would give the Pentagon the money it says it needs to keep funding the wars in Iraq and Afghanistan, while at the same time holding the Iraqi government and the Bush administration accountable for what happens next.

(BEGIN VIDEO TAPE)

SEN. HARRY REID (D-NV), MAJORITY LEADER: We all know that reaching consensus on a new bill to send the president won't be easy. Passions run high on this issue, very high.

KOPPEL (voice-over): Democratic leader Harry Reid was tight- lipped about what he wants in the Senate's bill. But a well placed Democratic source tells CNN talks with Republicans in the White House on brokering a deal are focused on benchmarks with teeth.

That's because, Democrats say, of key benchmarks or political goals the White House says it expects Iraq to meet, little or no progress has been made. A goal for Iraq to take responsibility for security in all its provinces by November may not be reached. Another to pass legislation to share oil revenues hasn't happened. And, experts say, it's unclear how much, if any, of a promised $10 billion of its own money Iraq has spent on reconstruction and infrastructure.

Still, the White House, which opposes benchmarks with strings attached, says the only date that really matters is September, because U.S. Commander David Petraeus has said that's when he'll know if his plan is working.

But today, a senior Republican, Virginia's John Warner, suggested he may not be willing to wait.

SEN. JOHN WARNER (R), VIRGINIA: I believe we have a responsibility to the -- first and foremost, to the men and women of the armed forces and their families, and to the country, for the Congress to watch very closely this situation and not defer until the September time frame.

(END VIDEO TAPE)

KOPPEL: Now, if a compromise is reached by early next week, a Democratic source tells CNN that the Senate could pass its own version of the spending bill by the end of the week. And then that means it will have to turn its attention to the much more difficult task of trying to meld those two bills together, the one in the Senate and the much tougher one in the House, some time before the Memorial Day holiday later this month -- Kitty.

PILGRIM: Thanks very much.

Andrea Koppel.

Now, President Bush says he will veto any attempt to restrict funding for the war or to set a withdrawal deadline. But the president is showing signs of flexibility on another issue related to the war, political and military benchmarks for the Iraqi government.

Ed Henry reports.

(BEGIN VIDEO TAPE)

ED HENRY, CNN WHITE HOUSE CORRESPONDENT (voice-over): The president tried an optimistic tone, rallying the Republican faithful at a Thursday night fundraiser.

GEORGE BUSH, PRESIDENT OF THE UNITED STATES: I don't want it to be said 50 years from now what happened to America in 2007. I want you to know I see the impending dangers. I understand the consequences of this historic moment. And we will succeed in Iraq.

HENRY: But there is no glossing over Mr. Bush's predicament.

REID: The president is in a bubble. He is isolated. Every day the ranks of dissatisfied Republicans grow.

HENRY: It's no longer just Democrats throwing the punches, with Republican intentions over Iraq spilling out in the open.

REP. JOHN BOEHNER (R-OH), MINORITY LEADER: There are no fissures in our conference.

TONY SNOW, WHITE HOUSE PRESS SECRETARY: The president has heard real criticism before.

HENRY: And now the president staunchest ally on Iraq...

TONY BLAIR, BRITISH PRIME MINISTER: I give my thanks to you, the British people.

HENRY: ... British Prime Minister Tony Blair, is leaving the stage.

THOMAS MANN, BROOKINGS INSTITUTION: He has fewer friends and I think he's beginning to realize that even a determined, principled president who is bent upon doing what he views is the right thing, runs out of room if he loses support within his own political party.

HENRY: So the president is on the defensive, showing a little more flexibility over including benchmarks in the war funding negotiations.

BUSH: I will continue to reach out to Democrats and Republicans to come up with a way to get this money to our troops as quickly as possible.

HENRY: And signing off on a trade pact that gave in to Democrats on labor and environmental standards.

MANN: It's the first sign that the president is willing to make significant concessions. I think the president is going to confront this choice again and again if he wants to salvage anything from his -- his second term.

(END VIDEO TAPE)

HENRY: But the president will have uphill battles securing victories on legacy items like immigration reform, which splits his party. He's now even having trouble trying to reauthorize a signature achievement of his first term, No Child Left Behind. He now has conservative opposition to that.

So, on immigration and education, ironically the president may get more help from Democrats than Republicans -- Kitty.

PILGRIM: That's interesting, Ed.

The president clearly has a huge struggle ahead of him. What are the consequences for the Republican Party if the president fails to regain the political initiative?

HENRY: Well, certainly, they were laying it on the line in that meeting Tuesday afternoon here at the White House. It got contentious with those 11 moderate Republicans.

That was one of the points they were making, is that they feel that the damage to the Republican Party could extend well into 2008 and beyond, both at the presidential and congressional level -- Kitty.

PILGRIM: Thanks very much.

Ed Henry.

Well, Tony Blair will visit the White House next week for what's likely to be his last meeting with the president, as British prime minister, anyway. Tony Blair has been the president's staunchest ally over the war in Iraq, and Blair will step down as the British prime minister at the end of June, and he's almost certainly to be replaced by finance minister Gordon Brown.

Now, Tony Blair and other European leaders are increasingly concerned about the radical Islamist terrorist threat in Europe. A senior U.S. official today told CNN intelligence agencies have discovered a terrorist plot to attack U.S. facilities in Germany. Three weeks ago, the State Department increased security at U.S. diplomatic offices in Germany.

Still to come, an island off of California engulfed by flames. Firefighters battling to save homes and businesses.

We'll have a live report.

Also, record flooding in Missouri. Dozens of communities are affected.

We'll have the latest on that.

And Democrats sell out the middle class and support the Bush administration's so-called free trade agenda.

We'll have a special report.

(COMMERCIAL BREAK)

PILGRIM: Firefighters are still battling a massive wildfire on Santa Catalina Island. That's off the coast of southern California.

Four thousand acres destroyed so far, about six square miles. Twenty-five hundred people were evacuated from their homes.

Now, this island is about 30 miles off of the coast of Los Angeles. And Dan Simon joins us now from Catalina Island with more -- Dan.

DAN SIMON, CNN CORRESPONDENT: Well, hi, Kitty.

For the people who live here, this place is absolutely paradise. The air is clean. There's very little crime. But that sense of calm was shattered yesterday when the fire broke out here on Catalina Island about 12:30 in the afternoon.

The fires were -- the flames were spread by about 20 to 30-mile- an-hour winds. The flames came dangerously close to many homes. At one point, the homes were just about a quarter of a mile from the fire. One house was lost, along with several businesses.

Kitty, as you mentioned, at this point the fire is about 10 percent contained and 4,000 achers have been scorched. But we're expecting an update here in just a little while, so we're expecting those numbers to increase dramatically, because crews really got some help with nature last night.

The winds died down and the temperatures decreased rapidly. So crews got some help. They are also getting some help from the firefighters who have been brought in here from the mainland. As you said, about 30 miles away is Los Angeles, along with Long Beach. That's where the ferries come in.

And the United States Marine Corps donated some hovercraft. And on those hovercraft have been the fire engines and all the resources necessary to battle this blaze.

As you can imagine, it's a tall order getting the resources out here. But crews have really done an outstanding job. They've kept those flames back, and they are expecting those numbers to increase.

As we said, we're going to get an update here in just a little bit.

Back to you.

PILGRIM: Dan, two points. One is, what are the ground conditions like? Is it particularly dry? And is that adding to the problem?

And also, it's an island. It must -- they must be facing logistical issues in getting equipment and people onto this island.

SIMON: No question about it.

In terms of the dryness, as you know, southern California has gotten very little precipitation this winter. Only about two inches. It's actually the driest season on record. And that's really what has enabled this fire to spread rapidly.

The conditions today, though, are pretty ideal for battling a blaze. Not much wind to speak of right now. The temperatures are down.

In terms of logistics, it is somewhat of a challenge getting a lot of people off the island in quick order. About 2,500 residents and tourists left the island yesterday. The only way really to get off is by ferry, so they had to bring in some extra ferries.

And as I alluded to earlier, getting all the engines and the fire personnel here is difficult. So the Marine Corps loaned some hovercraft. These are high-speed hovercraft, and they put all that heavy equipment on those -- on those boats, if you will, and that's how they got all those resources onto the island -- Kitty.

PILGRIM: All right. Thanks very much.

We wish them great success with that, but it looks like it's well under way.

Dan Simon, thank you.

Southern California is the scene of another massive wildfire this weekend. This one is in Los Angeles' historic Griffith Park. Now, this fire mostly contained tonight, but not before charring nearly 800 of the park's 4,000 acres. Today, California governor Arnold Schwarzenegger and local officials toured the park, pledging to restore the damaged areas.

(BEGIN VIDEO CLIP)

GOV. ARNOLD SCHWARZENEGGER (R), CALIFORNIA: I've shot, you know, all my -- a lot of my "Terminator" movies right here, 1, 2, and 3. And to see the very same places where we were and that we filmed destroyed is unbelievable.

It was very hard to take, especially when you see, for instance, the nursery that started in the '40s to be burned to the ground, and all the scorched hillsides and the canyons. And how close the flames really came to wipe out the residential areas, and how dangerous it really was.

(END VIDEO CLIP)

PILGRIM: Now, meanwhile, firefighters continue to battle wildfires on the East Coast of the country, also. There's now a second major wildfire scorching more than 100,000 acres in southeastern Georgia, and that fire has crossed over into northern Florida. And there more than 200 fires burning throughout the state of Florida, from the panhandle to southern Florida. More on fire in northern Florida.

We turn to CNN meteorologist Jacqui Jeras for the very latest on that -- Jacqui.

JACQUI JERAS, CNN METEOROLOGIST: Firefighters are describing conditions here as the worst they've ever seen. The fire has doubled in size in the last 24 hours.

The winds have been picking up this afternoon. The humidity has been dropping as the temperature has been rising.

More than 600 families have been evacuated from their homes. The town of Taylor has been evacuated as well.

All of those people live to the north of Interstate 10, where the fire still remains. However, it's inching closer and spreading to the south and to the west. And they are concerned that if it does reach the interstate, it could jump it and come right here into the town of Lake City.

(BEGIN VIDEO CLIP)

SONNY GREEN, FLORIDA DIVISION OF FORESTRY: Here in Florida, we're just entering, you know, what could be part of the worst season we've ever had. If we do get a change in the weather with the thunderstorms that are coming, we could have lightning as a result of that, and things could pick up in a hurry.

So it's -- we've got a long way to go yet. This is still a very dangerous fire, and one that we're going to watch very closely.

We'll be monitoring it all the time. We're going to have crews working tonight, around those residences, up Highway 441. And it's our hope to protect each and every one of them.

(END VIDEO CLIP)

JERAS: Lake City residents are already being advised to stay inside because the air quality is so poor. You can see the visibility all around me is extremely limited.

And that poor visibility has also prevented any aerial assaults on this fire today. No helicopters and no air tankers have been able to get up to help provide any relief.

Now, firefighters from all over the state are here in -- helping to fight with this effort. In fact, the street behind me, just a few hours ago, was filled with more than 50 tanker trucks ready to go out and help. You can see they have all pulled out to help relieve the crews there, but behind me there are still some bulldozers, and these may need to be sent out to help stop and set some of the fire lines.

PILGRIM: Jacqui Jeras reporting.

Now, rising floodwaters continue to be a major problem in parts of Missouri, where waters are expected to peak this weekend. Floodwaters are at or above record levels in parts of the northwest and central Missouri.

Levee breaks this week have flooded dozens of communities in the state. More than two dozens levees have been breached. Hundreds of people evacuated from their homes. The floods are the worst since 1993.

Time now for some of your thoughts.

And Dan in California wrote us an e-mail. "Upon reflection, I think you are taking the wrong approach on the illegal alien issue. We should keep the aliens who are trying to work and deport the employers who would sell the country down the drain to make a nickel."

And Marcus in New Mexico wrote to us. "I have a message for the Iraqi parliament. Take your two month summer vacation. Have fun, relax. And all of our troops with withdrawal from your country and do the same. When you return, give us a call."

George in Florida, "If the Iraqi parliament cares so little about their country that they're going to take a two month vacation, I think it's only fair that all our troops also take a two month vacation. And even better, never go back."

We will have more of your thoughts a little bit later in the broadcast. We look forward to that.

And coming up, Democratic leaders facing charges that they betrayed the American workers with their approval of a free trade deal.

We'll have the details.

The National Guard deployment may not be a reason for a decrease in illegal crossings from Mexico. It could simply be a matter of dollars and cents.

And we'll tell you why.

Stay with us.

(COMMERCIAL BREAK)

PILGRIM: Communist China's monthly trade surplus climbed to almost $17 billion for April. Now, those figures will put added pressure on Chinese officials who are due to meet with American trade representatives in Washington later this month.

Some U.S. lawmakers are pushing for punitive tariffs on Chinese goods if China continues to keep its currency undervalued. The undervalued currency gives China exporters a price advantage, adding to China's surplus, and also contributing to our exploding trade deficit.

House Democratic leaders today are facing rising criticism over their approval of a compromise fair trade deal. Now, critics say the Democrats rolled over for business and political interests, and middle class Americans will suffer.

Lisa Sylvester has our report.

(BEGIN VIDEOTAPE)

LISA SYLVESTER, CNN CORRESPONDENT (voice over): Democrats and Republicans were side by side on trade. House Speaker Nancy Pelosi announced what they call a breakthrough, a new baseline for labor and environmental standards.

REP. NANCY PELOSI (D-CA), HOUSE SPEAKER: Free trade must be fair trade. For that reason, we could only go forward because of the inclusion of basic internationally-recognized labor and environmental standards in our trade agreements that have been a long-standing Democratic priority.

SYLVESTER: The compromise paves the way for trade agreements with Peru and Panama. The congressional deal is being praised by the U.S. Chamber of Commerce, the Business Roundtable, and the National Retail Federation. But trade watchdog groups believe key Democrats, including Ways and Means chair Charlie Rangel, rolled over.

LORI WALLACH, PUBLIC CITIZEN: The standards are great. But it's frosting on a rotten cake that's going to lead to more job loss and downward pressure on our wages. It's totally unacceptable for our working Americans.

SYLVESTER: Rank and file Democrats have been calling for a moratorium on future trade deals. Instead, this new compromise could be a template for even more trade agreements and sets a path for renewal of trade promotion authority. Labor unions like the Teamsters and UNITE HERE were not happy.

BRUCE RAYNOR, UNITE HERE: I am more than surprised. I'm disappointed. These Democrats made a mistake. This is not the sentiment of the American people. American people are tired of losing jobs to third-world country.

SYLVESTER: Critics say the new labor and environmental concessions are unenforceable.

ALAN TONELSON, U.S. BUSINESS & INDUSTRY COUNCIL: They won't change U.S. trade flows one iota, and therefore won't create a single new job in this country and won't reduce the U.S. trade deficit by a single cent.

SYLVESTER: And the underlying problems with the trade agreements still exist. The deals are still structured to give companies a powerful incentive to move offshore, even with the new labor standards.

(END VIDEOTAPE)

SYLVESTER: There's criticism not just with the substance of this deal cut between Democratic leaders and Republicans. House members of the trade caucus were not pleased with the process, feeling they did not have enough input. Representative Marcy Kaptur saying the strongest voices for workers in the environment were not included -- Kitty.

PILGRIM: Lisa, it begs the question how valuable these labor and environmental factors are if they are not enforceable. It's window dressing, isn't it?

SYLVESTER: Well, that's what many of the Democrats, the rank- and-file Democrats are saying, that these provisions are not enforceable. That they haven't been able to enforce things like intellectual property rights, for instance, so what makes them think that they will possibly be able to enforce these environmental and these labor standard rules. And they say the bad elements of these trade agreements are still there -- Kitty.

PILGRIM: Thanks very much.

Lisa Sylvester.

And that trade deal is the subject of tonight's poll.

Now, do you believe the Democrats have sold out our middle class by agreeing to support President Bush's so-called free trade agenda? That's a yes or no vote here.

Cast your vote at loudobbs.com. And we'll bring you the results a little bit later in the broadcast.

Coming up, the Bush administration ignores reality and claims credit for a sharp decline of border apprehensions of illegal aliens.

Also, new details on communist China's huge espionage operation in the country.

And President Bush on the defensive. Is he a lame duck, or will he regain the political initiative? Three of the nation's best political analysts will join us.

(COMMERCIAL BREAK)

PILGRIM: The Bush administration claims its deployment of the National Guard to our border with Mexico is responsible for fewer illegal crossings into the United States. But, as Casey Wian reports, there could be a very basic reason why fewer illegal aliens are entering this country.

(BEGIN VIDEOTAPE)

CASEY WIAN, CNN CORRESPONDENT (voice-over): Border Patrol apprehensions of illegal aliens are down 27 percent so far this year. They are on pace to drop below 900,000 annually for the first time since 1989 when the first George Bush became president. Now his son claims that the drop in illegal crossings of the border is the result of his administration's increased enforcement efforts.

GEORGE W. BUSH, U.S. PRESIDENT: When you are apprehending fewer people, it means fewer are trying to come across. And fewer trying to come across, because we're deterring people from attempting illegal border crossings in the first place.

WIAN: But there's new evidence indicating the reason may not be the deployment of 6,000 National Guard troops powerless to apprehend anyone. It's the economy, stupid.

DAWN MCLAREN, ECONOMIST, ARIZONA STATE UNIVERSITY: When it comes to people crossing the southwest border, it's more the economy as a deterrent. What happens with the strengthening of Border Patrol and changes in policy and changes in procedure along the border, you simply have the people on the other side, the coyotes, the counter- Border Patrol, figuring out a way to get around.

WIAN: McLaren has studied the relationship between illegal alien apprehensions and national GDP growth since 1992. She found when the economy booms the Border Patrol is busy. When it's slowing, apprehensions drop.

In recent months a slump has hit the construction industry which has replaced agriculture as the nation's largest employer of illegal aliens. The Border Patrol admits it's possible an economic slowdown is a contributing factor to the decrease in illegal traffic but says, quote, "Our increased enforcement efforts, the National Guard, and the expansion of expedited removal or the major factors in the decline in apprehensions."

For 12 months in a row illegal alien apprehensions along the southwest border have declined. (END VIDEOTAPE)

WIAN (on camera): Economist say what's happening now along the border is a repeat of what happened after 9/11. Then the economy slumped. Border security increased and illegal crossings slowed. But the economy was the biggest factor. And when it rebounded, so did it illegal immigration. Kitty?

PILGRIM: That makes absolutely perfect sense. Thanks very much, Casey Wian.

More drug-related violence in Mexico today. Drug cartel gunmen killed three men near Nuevo Laredo which is a town close to the U.S. border. And yesterday four policemen assigned as body guards for a Mexican official were shot and killed. Despite recent pressure by Mexico's President Felipe Calderon violence between the warring drug cartels is escalating. Almost 1,000 people have been killed in drug- related violence in Mexico so far this year.

Turning now to the conviction of Chi Mak, he was found guilty of expiring to export American defense technology to communist China and of being an unregistered government agent of China. As Christine Romans now reports his trial shed light on Chinese techniques to collect American secrets. It's a rare and successful prosecution in what one counterintelligence official has described as an intensifying and troublesome pattern of Chinese spying.

(BEGIN VIDEOTAPE)

CHRISTINE ROMANS, CNN CORRESPONDENT (voice-over): Chi Mak's six- week trial highlights communist China's relentless efforts to steal American technology and is a rare conviction.

PETER LEITNER, HIGGINS FOUNDATION FOR COUNTERINTELLIGENCE: There is no great triumph here. It's should be something that is happening every month. We should be hearing of another conviction. But we don't. We wait years for convictions. That should never happen given the scale and extent of the espionage being waged against us.

ROMANS: Leitner says untold numbers of collectors likes Mak send pieces of information back to China not for money but for love of country. Intelligence analysts describe a grain of sand technique. Instead of building a beach, the Chinese steal it, they say, one grain at a time to assemble back home. They worry that students, technology workers and defense contractors are freely operating in the U.S., sending information to china to relatives and government handlers.

LEITNER: The Chinese communist government exploits this freedom and it exploits the affinity, the loyalty, the family relationships that Chinese Americans have with the greater Chinese community in China and elsewhere to advance espionage, to threaten and undermine the security of the United States.

ROMANS: The national counterintelligence executive Joel Brenner earlier this year called the Mak case symptomatic of, quote, "an intensifying and troublesome pattern." Quote, "Eh Chinese are leveraging the American R&D budget, your tax dollars and mine, in support of their own war-fighting capability," putting American lives at stake, he says, in the Taiwan Straits.

Chi Mak's defense worries the conviction will bring unfair scrutiny to other Chinese American professionals in the U.S.

(END VIDEOTAPE)

ROMANS (on camera): The Chinese Foreign Ministry routinely denies all spying accusations, but one retired FBI agent said China's spying is rooted in the idea that no matter how long someone is away, no matter where they live, they will always help china. He says that is all part of Chinese culture. All students, visitors and other immigrants were supposed to bring back information to benefit the country. Kitty?

PILGRIM: Fascinating case. Thanks very much. Christine Romans.

Coming up, congressional Democrats cave in to the Bush administration on the issue of free trade. Now three of the nation's leading political analysts will discuss that, and a lot more, straight ahead.

(COMMERCIAL BREAK)

PILGRIM: Republican presidential candidate Rudy Giuliani today reaffirmed his pro-choice stance on abortion rights. Now, Giuliani urged conservatives to look past this one issue as he looks for their support. And Giuliani said individual choice on abortion should be respected.

(BEGIN VIDEO CLIP)

RUDY GIULIANI, (R) PRESIDENTIAL CANDIDATE: In a country like ours, where people of good faith, people who are equally decent, equally moral, and equally religious, where they come to different conclusions about this, about something so very, very personal, I believe you have to respect their viewpoint.

(END VIDEO CLIP)

PILGRIM: Now, the former New York mayor also reaffirmed his personal stand against abortions. His personal stand. And he said that abortion is the most divisive issue in this country.

Another Republican presidential candidate, Mitt Romney, is talking about abortion saying he strongly opposed it. In a "Time" magazine interview Romney says he shifted his views on abortion in 2004. This weekend, Romney, who is a practicing Mormon, talks about religion in an interview with CBS's "60 Minutes."

(BEGIN VIDEO CLIP)

MIKE WALLACE, CBS NEWS CORRESPONDENT: One out of three people were worried about you as a president because you are a Mormon, why?

MITT ROMNEY, (R) PRESIDENTIAL CANDIDATE: There's part of the history of the church's past that I understand is troubling to people.

Polygamy, which was outlawed in our church in the 1800s, that's troubling to me. I have a great, great grandfather. They were trying to build a generation out there in the desert and so he took additional wives as he was told to do, and I must admit, I can't imagine anything more awful than polygamy.

(END VIDEO CLIP)

PILGRIM: Now, Romney also discusses the war in Iraq in that interview.

Joining me, are three of the country's best political analysts, Ed Rollins, former White House political director under President Reagan, Michael Goodwin, columnist for "The New York Daily News" and Democratic strategist Robert Zimmerman and thanks for being with us.

Let's go through the Giuliani, Romney issues first. Now, Giuliani, the most divisive issue in America, do you think so, Bob?

ROBERT ZIMMERMAN, DEMOCRATIC STRATEGIST: What it really is about is not Giuliani and Romney, is the fact that the Republican Party has become the latest victim of Karl Rove's divisive and vicious tactics.

This is what we're witnesses in the Republican Party. Where Rove's tactics of dividing people along religious grounds and demonizing opponents has now come back to haunt the Republican Party so that no moderate can emerge because the extreme religious radical right wing won't allow it.

PILGRIM: Michael?

MICHAEL GOODWIN, "NEW YORK DAILY NEWS": I think that's foolish. In fact, Republican platform has been basically pro-life since 1980. Gerald Ford is the only Republican to be the nominee since Roe v. Wade in 1973. So it has nothing to do with Karl Rove or recent developments. Just as the Democrats have been pro-choice all along.

So this is a real distinction between the parties, a real difference and Giuliani is bucking history by being pro choice and seeking the Republican nomination. I think he -- he -- I think was not clear during the debate. He's trying to be more clear now about what he is for and what he is not for. So I think this is a big step for him today.

PILGRIM: The spotlight is definitely on him on this issue. Ed?

ED ROLLINS, REPUBLICAN STRATEGIST: No question. There are certain people who feel very strongly on both sides of this issue. The vast majority of Americans are for something in between. Tell me what the circumstances are. Tell me what -- with some restrictions, parental notification, a whole variety of things. Actually there's only about six percent on both extremes that vote for extreme positions on this issue. The Republican Party, obviously, has been taking this as a major issue. Democrats refused to let one of their governors, Casey, even speak at the Democrat convention. The numbers aren't far that apart, about 39 percent of Democrats are pro life and about 41 percent of Republicans are pro life. So it's an issue that a lot of people aren't comfortable discussing. I think Mr. Giuliani has done the right thing. This has been his position and he needs to basically stick with it and ...

ZIMMERMAN: The issue here is not the fact that people are pro choice or people are, in fact, support -- are opposed to abortion. The issue here is the fact that under Karl Rove's political leadership he has demonized the opposition and created such divisions and such extremes, whether it's demonizing the gay community, attacking women who support women's right to choose and that's what we're seeing here.

The fact that Rudy Giuliani is unclear about his position, Mike, is not the problem. The fact that ruddy Giuliani does not have a firm position and is trying to navigate a Republican Party controlled by the right wing, that's the issue.

PILGRIM: Let's move on to Mitt Romney.

GOODWIN: If you insist.

PILGRIM: I have nothing to add to that.

We had an interesting comment about Mitt Romney. Al Sharpton said, those who really believe in God will defeat Romney and Romney, of course, called those remarks bigoted. A pretty ugly exchange this week. What's your view?

ZIMMERMAN: Obviously Al Sharpton should apologize for those comments. They really were certainly very hurtful and inflammatory. It doesn't belong in an intelligent discussion of a presidential campaign and I think it's really a reflection of the times we're living in. Whether it's attacking Mitt Romney over his Mormon faith or attacking individuals because they are pro choice or singling out individuals in the gay community with the gay marriage proposals that are put forward.

It's a reflection of the times we're living in that we're seeing this type of extremist rhetoric dominate.

GOODWIN: I thought he was going to blame Karl Rove for that, too.

PILGRIM: Really?

ROLLINS: For Al Sharpton?

GOODWIN: Yeah, that's where I thought he was going.

PILGRIM: That would be a stretch.

GOODWIN: Well?

ZIMMERMAN: I want to see you defend Al Sharpton on this one.

GOODWIN: Sharpton, did, in fact apologize which I think was the right thing to do.

ROLLINS: I don't think any man of God and obviously I respect Mr. Sharpton's religious beliefs shouldn't condemn anybody else for what their beliefs are. And I think to a certain extent I can be very cynical and say from a Republican's perspective being attacked by Al Sharpton is a benefit, but at the end of the day, I think it's a bad issue and I think it all needs to go away.

PILGRIM: Let's go to the big issue in Iraq and funding the war. A very big issue this week. Let's listen to what Senate majority leader Harry Reid had to say about this.

(BEGIN VIDEO CLIP)

SEN. HARRY REID, (D) NV: The president is in a bubble. He is isolated. Every day the ranks of dissatisfied Republicans grow. But I wish that my Republican colleagues, who now agree that President Bush's open-ended commitment has failed would put some teeth behind their views.

(END VIDEO CLIP)

PILGRIM: All right. What's your view? Is the president in a bubble?

ZIMMERMAN: A bubble is a very effective euphemism. It's a fact, it's not just that he's in a bubble. It's that his own team, his own administration, refuses to deal with reality. And that's really the greatest disservice here are for the great men and women who are fighting overseas.

What we've seen -- The republicans that came forward to the president, they are no profile in courage. After the fifth year in engagement in a war in Iraq and now they come forward before election time?

PILGRIM: The president has ...

ROLLINS: Filibuster tonight.

ZIMMERMAN: I will -- I yield to Mr. Rollins and I apologize.

PILGRIM: You're finished. Mr. Rollins next.

ROLLINS: The bottom line is the president I think is now reaching out to some Democrats and certainly his own party. He's going to make some concessions. The one concession he can't make is on the funding. As Secretary Gates made a very impassioned speech the other day, we spend so much money to get the guys there that basically you have to wait for two or three months and you're going to have to shut down so many programs in the Pentagon, it's a big gigantic government community and I think you have to fund it until you decide not to fund it.

PILGRIM: We've seen some flexibility from Mr. Bush on the benchmarks also.

GOODWIN: Well, he's said that. We don't know what he really means on by that. Whether it's on the Iraqi government or American progress. We don't really know.

I think the one thing that is clear from the last week skirmish over this is that the two-month funding that the House passed is a very bad idea. It's very bad politics as well as bad government.

So I think the Senate is not going to go for that. There is clearly continued negotiations over what the president will support so there can be a compromise. And I think the trade agreement shows that both sides now are eager to make deals on things and Iraq is by far the toughest. But I wouldn't be surprised to see that there comes out of this some bill. Because clearly September is some kind of deadline. Petraeus has said September is a time for review.

ZIMMERMAN: September is an arbitrary deadline. The reality is our soldiers are refereeing a civil war. And the reason the funding legislation was so important because it keeps pressure on the Bush administration and the Iraqi government to step up.

PILGRIM: Let's talk about the face-off between Bush and Congress - Yes, go ahead.

GOODWIN: Can I -- I don't think you put pressure on the administration by starving the troops. It's like taking hostages.

ZIMMERMAN: That's not the position, Michael, and you know that!

GOODWIN: That's what the funding is about. If you don't fund the military.

ZIMMERMAN: Michael, the troops will be well funded.

GOODWIN: By whom?

ROLLINS: By whom?

ZIMMERMAN: By the American taxpayer. By the Congress. The issue is not getting ...

GOODWIN: There has to be an authorization.

ZIMMERMAN: That will happen but the issue is it has to be done gradually.

GOODWIN: Let's do it. Let's do it.

ZIMMERMAN: Because the goal is not to give this administration a blank check.

PILGRIM: But you think funding as a tactic. Is it legitimate? ZIMMERMAN: It's not only legitimate, it's essential to hold this administration accountable. Our soldiers will be protected.

ROLLINS: Robert, you don't know that. First of all, you made your point. The Democrats made their point. You made your point. They passed the bill. They got vetoed, they couldn't override the president's veto. I think at this point in time as long as our troops there and it's not just basically stepping in between a civil war. They are trying to create some civilization out of chaos and it's not -- and I think those -- to a certain extent we've talked over and over again. This has become more of a police action than a warring action.

And the cut -- and anybody in the military will tell you to cut their resources or even the threat of cutting off their resources creates a psychological damage to them and that's not what we want to do.

GOODWIN: Certainly no general supports that. So when you want to say that the president doesn't back his generals or overrules the generals. That's exactly what Congress is doing. No military person would ever say cut the funding.

ZIMMERMAN: This administration is not supporting our troops. They are not providing the proper equipment to go into battle.

GOODWIN: So cutting the funding is the answer?

ZIMMERMAN: No, I think the way the administration is using the troops as a shield for their lack of success ...

ROLLINS: Wait a minute.

ZIMMERMAN: Yes, sir.

ROLLINS: In last night's show you talked about the $18 billion in replacing the Humvees, they are putting a much better piece of equipment in there.

ZIMMERMAN: In the congressional legislation.

ROLLINS: In the congressional legislation. It's certainly what the administration has asked for, too. So I think the bottom line here is we have to figure out where we are six months from now and if we can't make some progress, then I think there will be unanimous, not unanimous but near unanimous support to do something.

ZIMMERMAN: It's been four years, Ed, we know where we are.

PILGRIM: The debate does not seem to be playing well with the public. We have a poll that shows -- this particular debate is. But the polls say that the public is as disenchanted with Congress as it is with President Bush and look at these approval ratings. Congress, 35 percent. President Bush, 35 percent. Is the American public is sitting out there saying what is all this rhetoric about? What are these fights about? Do they even understand what's going on? ZIMMERMAN: Well, you know, I think it's true. While the polls show that the Congress' approval rating has dropped because the public isn't seeing anything getting down. I don't know any Democratic member of the House or Senate that wants to trade places with a Republican member of the House or Senate.

And in generic polls, Democrat versus Republicans, Democrats are doing OK.

GOODWIN: Look, and I think the public is fed up with Iraq. They are fed up with the squabbling in Washington as well, but they are clearly fed up with Iraq.

So I don't know that the public is going to pick a winner or a loser on the Iraq case. I think both sides are going to have to do this on substance, not politics.

ROLLINS: I think the failure is - and I think it's a leadership failure. I think the Democrats have not been able to properly position what they're back and I think Nancy Pelosi, whose numbers have suffered dramatically in the last month, she may be more popular than the president but she's at 45 percent.

And Harry Reid's numbers. You don't have the most articulate, effective communicators.

ZIMMERMAN: I think it's not even just that but you're on to a very important point, though, Ed. And that is the fact is Democrats are trying to bring about a new strategy and bring about a new mission in Iraq. We're trying to dig out of the tragedy this administration has given us and the reality is there aren't any solutions, just very tough choices.

PILGRIM: Robert, we have to leave it there. Thanks very much, gentlemen, always a pleasure. Ed Rollins, Robert Zimmerman, Michael Goodwin. Thank you.

Coming up in just a few minutes, THE SITUATION ROOM with Wolf Blitzer.

Wolf?

WOLF BLITZER, CNN HOST: Thanks, Kitty.

Coming up, Vice President Dick Cheney firing a new verbal warning shot at Iran from aboard an aircraft carrier in the U.S. Persian Gulf. Says the U.S. is prepared to use its naval power to prevent Iran from getting nuclear weapons or expanding its influence.

And this Mickey Mouse look-alike preaching hate. A children's show host working on behalf of Hamas that mimics killing Israelis. After worldwide outrage, you might be surprised to learn how the show's producers responded today. We have the latest.

And seek, deter and possibly destroy. What happens when a potentially threatening plane flies in air space it should not be in? We're going to show you. All that, Kitty, coming up right here in THE SITUATION ROOM.

PILGRIM: We looking forward to it, Wolf. Thanks very much. A reminder now to vote in tonight's poll. Do you believe the Democrats have sold out the middle class by agreeing to support President Bush's so-called free trade agenda? Yes or no. Cast your vote at loudobbs.com and we'll bring you the results in just a few minutes.

Coming up, "Heroes." Tonight, the inspiring story of a wounded soldier's determination to walk again. Stay with us for this.

(COMMERCIAL BREAK)

PILGRIM: Now, "Heroes." It's our tribute to the men and women who serve this country in uniform. Tonight, we bring you the story of an unwavering courage and determination. Army Specialist Sue Downes lost both of her legs while serving in Afghanistan, but this mother of two beat the odds. She's learning to walk again.

Barbara Starr has her story.

(BEGIN VIDEOTAPE)

BARBARA STARR, CNN CORRESPONDENT (voice-over): Army Specialist Sue Downs had just returned from R&R.

SPECIALIST SUE DOWNES, U.S. ARMY: I was in Afghanistan November 28th of '06. I was on patrol. We were in the mountains and we went over two anti-tank mines. I was a gunner.

STARR: This 27-year-old was trapped under an armored Humvee.

DOWNES: They said I started screaming, you know, for them to get the Humvee off of me because I had the turret shield on me.

STARR: The mother of two small children lost both her legs. On this day, Specialist Downes is overcoming the setback. Like many amputees, she has had follow-on surgery. There are painful efforts to try to bend her knee so she can put on prosthetics and walk. She is determined to walk.

DOWNES: The bottom of my leg hurts.

UNIDENTIFIED MALE: What's wrong?

DOWNES: The bottom of the stump right there, where it hurt yesterday.

STARR: She readily acknowledges all of the challenges ahead.

DOWNES: It's been tough mentally, more mentally than physically.

STARR: So does Sue Downes, who like so many badly injured troops, is now so determined to recover think of herself as a hero?

DOWNES: I was just doing my job. I think we all were. You know, heroes, I think we all deserve that title. I mean, we're going over there and putting our lives out there. You know, we're getting injured for the people here. So I think we deserve that title.

STARR: Barbara Starr, CNN, Walter Reed Army Medical Center.

(END VIDEOTAPE)

PILGRIM: Courageous woman. We'll be right back.

(COMMERCIAL BREAK)

PILGRIM: Now the results of tonight's poll. Ninety-seven percent of you believe Democrats have sold out the middle class by agreeing to support President Bush's so called free trade agenda.

Time now for some of your thoughts and Rick in Florida wrote to us, "The war on terror, the war on drugs, the war on illegal immigration. The only war we are winning is the war on the middle class. Day after day they are being eliminated."

And Megan in Tennessee. "I want to thank you for discussing the issue of religion in politics. They have come uncomfortably related. Can't anyone respect separation of church and state anymore?"

Paulette in Maryland. "If the Catholic Church wants amnesty for illegal immigrants, they should take full responsibility for them. They should provide healthcare, housing and jobs."

Tom in Colorado. "Regarding you article on the encroachment of the religious sector into the political arena, you could not be more correct. Anyone who believes that politics and religion is a good mix should take a trip to Iran."

J.B. in Georgia. "I told my husband after the Imus controversy that Al Sharpton and Jesse Jackson were setting the bar so high that even they would not be able to get over it. Talk about I told you so."

We love hearing from you. Send us your thoughts at loudobbs.com. Thanks for being with us tonight. Please join us tomorrow as religious leaders defy our immigration laws and give sanctuary to illegal aliens. Are they violating the doctrine of separation church and state? We'll have a special report on that. For all of you here, thanks for watching. Good night from New York. THE SITUATION ROOM starts right now with Wolf Blitzer.

Wolf?

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