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Lou Dobbs Tonight
Congress Gives in to Bush on War Funding
Aired December 19, 2007 - 19:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
KITTY PILGRIM, CNN CORRESPONDENT: Thanks, Wolf. Tonight the White House wins a major victory over congressional Democrats. The House of Representatives giving President Bush what he wants, money for the war in Iraq.
We'll have all that, all the day's news, much more straight ahead tonight.
ANNOUNCER: This is LOU DOBBS TONIGHT, news, debate and opinion for Wednesday, December 19.
Live from New York, sitting in for Lou Dobbs, Kitty Pilgrim.
PILGRIM: Good evening, everybody. House Democrats tonight retreated in the battle of the White House over funding in the war in Iraq. Congress voted for a massive spending bill that that includes $70 billion in war funding for Iraq and Afghanistan. It's a major set back for Democrats, for nearly a year Democrats have been trying to link funding for the war in Iraq with a firm timetable for withdrawal. Brianna Keilar reports from Capitol Hill. Brianna?
BRIANNA KEILAR, CNN CORRESPONDENT: Kitty, the spending bill now goes to President Bush and the fact it includes unconditional funding for the war in Iraq is a big disappointment for Democrats.
(BEGIN VIDEOTAPE)
KEILAR (on camera): The latest in series of set backs for democrats who have spent the year trying to get President Bush to change course in Iraq, a massive spending bill completely with about $70 billion for war spending, no strings attached. This is not where the Democrats thought back in 2006 as they appealed to voters unhappy with the war.
SEN. CHARLES SCHUMER, (D) NY: For Americans who want a change in course in Iraq, there's only one answer, whether you're Democrat, independent or Republican. It's to vote for Democratic candidates in the Senate and in the House.
KEILER: Voters agreed, giving Democrats a majority in Congress.
SEN. MITCH MCCONNELL, (R) MINORITY LEADER: As of last night we had 34 votes on Iraq this year.
KEILAR: As Republicans are quick to point out, not a single Democratic effort has forced a president to change his policy, even as measures passed the House they hit a brick wall in the Senate. The explanation from Democrats, simple math.
SEN. CARL LEVIN, (D) MI: The U.S. Senate is a peculiar place. It's the only congress or parliament in the world where a majority doesn't rule, you've got to get a super majority or 60 votes in order to overcome the filibuster.
KEILAR: But Republicans say Democrats wasted time, pursuing legislation that had no chance of passing.
MCCONNELL: This effort to kind of constantly score political points by putting up measures that are going no where, making no compromises, taking them down and accusing the other side of obstruction is not going it work.
(END VIDEOTAPE)
KEILAR (on camera): Republicans like Senate Minority Leader Mitch McConnell are being optimistic today. He touted recent military successes and said he is confident that Americans will rally behind those.
But as far as Democrats, in the words of Senate Majority Leader Harry Reid they are going put the pedal to the metal and keep pressure on Republicans and President Bush, Kitty.
PILGRIM: Brianna, do Democrats have anything to show for their fight to change the Iraq War policy?
KEILAR: Well, when you look at what they have done, there is no legislation. There is nothing legislatively. However, one government expert that I spoke with, he told me they have been successful in changing the political debate about the war in Iraq and while that isn't legislation he said that is a measure of success that can't be ignored, Kitty.
PILGRIM: Thanks very much, Brianna Keilar.
Congressional Democrats tonight are stepping up their offensive against the White House on interrogation videotapes. Democrat say the Justice Department has reversed itself and will allow the CIA to cooperate with an investigation into the tapes' destruction.
Meanwhile the White House is taking issue with "The New York Times" coverage of this controversy. Ed Henry reports from the White House.
(BEGIN VIDEOTAPE)
ED HENRY, CNN CORRESPONDENT (voice-over): On the same day firemen rushed to the White House compound to put out a fire, press secretary Dana Perino was struggling with another problem caused by a "New York Times" headline claiming the White House's role in the CIA videotapes case was wider than officials first said.
DANA PERINO, WHITE HOUSE PRESS SECRETARY: Implying that I had either changed my story or I or somebody else at the White House had misled the public. And that is not true and I have heard now from "The New York Times" that they will retract that headline.
HENRY: But most notable is the White House did not demand a correction of the story's key assertion, that four White House lawyers were involved in discussions with the CIA about whether to destroy the tapes showing interrogations of terror suspects.
PERINO: I'm not commenting on the underlying facts of the story. I'm sticking with what I had done in the past which is that there is a ...
HENRY: But in fact "The New York Times" story does suggest a wider role for the White House than Bush administration officials suggested earlier this month. When the story first broke administration officials anonymously told reports that former White House aide Harriet Miers had urged the CIA not to destroy the tapes. One senior official then telling CNN of the CIA, they were told not to destroy the tapes, it was fairly unequivocal and completely unanimous.
PERINO: I'm not accountable for all the anonymous sources that you turn up. I'm not. I'm accountable - I speak for the president and the White House. This says that I was misleading and I was not.
(END VIDEOTAPE)
HENRY (on camera): CNN has just learned from a U.S. official that the CIA's general counsel John Rizzo is now saying he is ready to appear voluntarily before the House Intelligence Committee to give his testimony about exactly what happened in this tape case and that the committee on Capitol Hill could actually start getting documents from the CIA on this case as early as Thursday. Kitty?
PILGRIM: Ed, what will the Houses committee zero in on in their investigation?
HENRY: Well, they certainly want to ask Rizzo as the top lawyer at the CIA exactly who knew what when and they'll want to probe who at the White House knew what when. Now that the "New York Times" is reporting that four White House officials knew about this tape controversy at some level, were involved in this decision at some level. They are certainly going to want to probe into find out whether or not the president knew sooner. As you know, White House officials still maintain the president only learned about the existence of the tapes and the destruction earlier this month, Kitty.
PILGRIM: So the timeline is absolutely critical to this. Thanks very much, Ed Henry.
HENRY: Thank you.
PILGRIM: Turning to the campaign trail. The Iowa caucuses are just two weeks ago and the campaigns are turning their attention to the next major contest, the New Hampshire primary and pollsters watching that contest are seeing some interesting changing. Bill Schneider has our report from Manchester, New Hampshire.
Bill? BILL SCHNEIDER, CNN CORRESPONDENT: It's mighty cold up here in New Hampshire, but this campaign is not frozen in place. What is changing most are the issues driving this campaign.
(BEGIN VIDEOTAPE)
SCHNEIDER (voice-over): They say if you don't like the weather in New England, wait a few minutes, just like politics.
A week ago Hillary Clinton and Barack Obama were neck and neck in New Hampshire. Now Clinton has regained her lead. What happened? Most of her gains came from seniors. Over the longer run, we are seeing a big shift in the issues, Iraq no longer dominates the campaign.
ANDY SMITH, UNIVERSITY OF NEW HAMPSHIRE: As Iraq drops in importance as an issue, it allows these other traditional issues that come up in any campaign, particularly the economy and health care as an issue related to the economy. It allows them to come up.
SCHNEIDER: Health care is now equally important to New Hampshire Democrats. That is an issue Democrats give Hillary Clinton high ratings on despite her bad experience with health care reform in the 1990s, actually, because of that experience.
SEN. HILLARY CLINTON, (D) PRESIDENTIAL CANDIDATE: Back in '93 and '94 we tried to come forward with a plan, we weren't successful. I have the scars to show for that experience.
SCHNEIDER: More voters are concerned about the economy, another issue where Democrats give Clinton high ratings.
CLINTON: When we husband became president, he inherited a lot of economic problems. As someone said the other day, there seems to be a pattern here. It takes a Clinton to clean up after to Bush.
SCHNEIDER: Pocketbook issues are moving to the forefront of this campaign.
SCOTT SPRADLING, WMUR: Candidates are now talking a lot more economic issues than they were just a few months ago.
SCHNEIDER: That explains Mitt Romney's continuing lead among New Hampshire Republicans. They say they trust Rudy Giuliani to deal with terrorism and John McCain to deal with Iraq, but Iraq and terrorism have been declining in importance. Which candidate do they trust most on the economy? Mitt Romney.
MITT ROMNEY, (R) PRESIDENTIAL CANDIDATE: I have worked in 20 countries around the world working on investments and helping managing businesses and so forth. That skill, that experience is essential.
(END VIDEOTAPE)
SCHNEIDER (on camera): When the economy is bad, the economy is the issue and here in New Hampshire you hear talk about another economic downturn, like the one this state suffered 15 years ago. Kitty?
PILGRIM: Thanks, Bill. Bill Schneider reporting from Manchester, New Hampshire.
And coming up, the Catholic Church leaders are at it again, pushing their pro-illegal alien agenda. Casey Wian will have a report. Casey?
CASEY WIAN, CNN CORRESPONDENT: Kitty, the Catholic Church is using the story of Christmas to promote illegal alien amnesty. We'll explain coming up, Kitty.
PILGRIM: Thanks, Casey. Also new evidence the Bush administration is utterly failing to close the gaping holes in border security. We will have that story and new charges that special interests are influencing members of Congress on the critical issue of toy safety. We'll have a special report on that. Stay with us.
(COMMERCIAL BREAK)
PILGRIM: A new report suggests the Bush administration's obsession with the Cuban trade and travel embargo might be having unintended consequences. The Government Accountability Office says more resources are directed towards making sure the embargo is enforced than toward preventing terrorists from entering this country.
Bill Tucker reports.
(BEGIN VIDEOTAPE)
BILL TUCKER, CNN CORRESPONDENT (voice-over): Passengers arriving from Cuba at Miami's international airport are far more likely to get a closer look and a second even closer look than arrivals from any other country. That increased attention is the result of making sure the Cuban trade embargo is not broken and it has a price. It's a price that the Government Accountability Office raises some tough questions in its report on competing priorities in enforcing the U.S. embargo on Cuba.
DAVID GOOTNICK, GAO DIRECTOR OF INTERNATIONAL AFFAIRS AND TRADE: What we found was an inordinate amount of time and effort, resources devoted by CBP to interrupting contraband that's being brought back in by U.S. citizens, largely cigars, Cuban rum and small amounts of pharmaceuticals.
TUCKER: The GAO found that 20 percent of passengers arriving from Cuba to Miami received second inspections while three percent of passengers arriving from other countries got a second closer look. That attention, the report cautions, taxes the resources of the Customs and Border Protection Bureau and, quote, "may strain CBP's ability to carry out its mission of keeping terrorists, criminals and other inadmissible aliens from entering the country."
Customers and Border Protection responded to the report saying, quote, "CBP is responding appropriately to the Treasury Department's U.S.-Cuba embargo." Customs and Border Patrol is not alone in this singularity of focus. The report notes that the Treasury's Office of Foreign Assets control has opened more investigations and levied more fines for embargo violations such as buying Cuban cigars, than for other violations of other sanctions, such as those on Iran.
(END VIDEOTAPE)
TUCKER (on camera): And we are potentially sacrificing our security for naught. The report finds that the embargo's effectiveness has been undermined by other countries who all engage in active trade with Cuba, Kitty. Everybody else gets around it. So the intended consequence is not there.
PILGRIM: Including Canada?
TUCKER: Exactly.
PILGRIM: Thanks very much, Bill Tucker.
TUCKER: You're welcome.
PILGRIM: Well, Catholic Churches across the country last night held services to honor International Migrants Day and to deny amnesty for millions of illegal aliens. Incredibly, priests compared modern day immigrants to Mary and Joseph. Casey Wian reports.
(BEGIN VIDEOTAPE)
CASEY WIAN, CNN CORRESPONDENT (voice-over): Declaring there is room at the inn for millions of immigrants living illegally in the United States, the Catholic Church says the Christmas story of Mary and the birth of Jesus mirrors that of many immigrants. Priests use that story to promote what they call comprehensive immigration reform on International Migrants Day.
REV. SCOTT SANTAROSA, DOLORES MISSION CATHOLIC CHURCH: On behalf of our parish community, I would like to welcome you on this International Migrants Day as we give thanks to God for the presence of our migrant brothers and sisters and recommit ourselves to work for a just and humane reform of United States immigration law.
WIAN: At a service in Los Angeles, the priest introduced an immigrant couple he called a modern day Mary and Joseph. Claudia says she is a U.S. citizen and has filed a petition for her husband.
CLAUDIA VIDALES, IMMIGRANT: So please use this opportunity to help him get papers for everybody because they need them.
WIAN: Then the congregation posed for a picture to send to the presidential candidates.
SANTAROSA: We call upon the presidential candidates to support immigration reform policy that is just, humane and comprehensive.
WIAN: While similar services took place in Chicago, New Jersey and San Antonio, another pro-amnesty religious went to the border and held a Posada (ph), Mexico's traditional pre-Christmas celebration.
Illegal alien Elvira Arellano who claimed sanctuary for a year in a Chicago Methodist church before finally being deported joined other families separated by the border. They shared food through the fence and prayed for amnesty.
ROCIO CARRILLO, MEXICAN IMMIGRATION (through translator): I'm happy and also outraged because I can't believe that this divides us. Because God created only one world, not many.
WIAN: Arellano, appearing healthy despite her hunger strike at the U.S. embassy in Mexico City, is continuing her campaign to stop all raids and deportations by U.S. Immigration authorities.
(END VIDEOTAPE)
WIAN (on camera): Arellano told a Mexican newspaper she is considering leading a march on Washington, DC to demand more rights for illegal immigrants on May Day next year. She doesn't say how as a deported felon she plans to reenter the United States. If she doesn't go, she is considering sending her 18 year old U.S. citizen son, Saul. Kitty?
PILGRIM: Casey, how much of this activity is linked to the growing congregations in these churches of illegal immigrants?
WIAN: Well, absolutely. There is a connection. The Catholic Church in the United States, it's been well documented that it's been having trouble filling its pews and one of the areas of growth is immigration, both legal and illegal immigrants so there is definitely an impetus for the Catholic Church to want to encourage as many illegal immigrants to stay in the United States as possible, Kitty.
PILGRIM: Thanks very much. Casey Wian.
Time now for some of your thoughts. Norman in Missouri wrote to us, "Most of the groups supporting rights for illegal immigrants loudly shout that their rights are covered by our Constitution. Am I wrong? I thought the Constitution only covered legal citizens. In any case, I'm tired of listening to their nonsense and that of our political leaders. Both my wife and I are now independents."
Stacy in Illinois wrote to us. "Congress has shot holes in yet another border bill. This Congress seems intent on doing whatever it wants regardless of what We the People are asking for. Let's just hope that the average American's frustrations are evident in the 2008 elections."
Eugene in California wrote, "Lou, I've been a Republican since 1969. However, since both political parties have ignored the will of the American people for decades, I am not registered as an independent."
We'll have more of your e-mail a little bit later in the broadcast. Each of you whose e-mail is read here receives a copy of Lou's new book, "Independents Day, Awakening the American Spirit." And coming up, why do dangerous toys from communist China wind up in the country. A government watchdog says it has the answer and we'll have a special report on that.
And did the U.S. government conspire to cover up the rape of an American citizen in Iraq? Congressman Ted Poe asked the Justice Department to investigate. You will be shocked by the response. Congressman Ted Poe joins me here. Stay with us.
(COMMERCIAL BREAK)
PILGRIM: Just days before Christmas, the House passed a bill to ban lead in toys and reform the Consumer Products Safety Commission. But a new report says Capitol Hill and U.S. toy companies are to blame for stores full of dangerous toys. The report by Public Citizen charges lawmakers are succumbing to the influence of special interests and passing trade agreements that put children's lives at risk.
Louise Schiavone reports.
(BEGIN VIDEOTAPE)
LOUISE SCHIAVONE, CNN CORRESPONDENT (voice-over): More toy recalls this week. Part of the avalanche of defective playthings exported in ever greater quantities from China. The latest. Soldier Bear toys, the defect as in 70 percent of all toy recalls this year, lead paint content.
Critics say it's yet another example of how trade agreements designed for bargain hungry American consumers have become a losing proposition for the United States.
LORI WALLACH, PUBLIC CITIZEN: They are exporting back all the environmental and health problems. Lead contamination, toxic contamination that you see actually hurting millions of people in China, they are importing all those problems back with the toys the same time they are paying sweat shop wages in China.
SCHIAVONE: According to Public Citizen's global trade watch latest snapshot, there have been 120 recalls this year, compared to roughly a dozen a year between 1972 and 1982.
The report also says that while unsafe 36 cent an hour sweat shop conditions prevail in China, corporate salaries at the U.S. toy companies are in the multimillions dollars, or on average, 21,000 times what those workers make. This as U.S. toy production jobs evaporated. That is what happened in a small Ohio town that used to make the Etch-a-Sketch toys after production was moved to China, wiping out 200 jobs.
SEN. SHERROD BROWN, (D) OH: The jobs leave, they lay off police and fire and teachers, the tax base erodes, family are devastated, whole neighborhoods sometimes are.
SCHIAVONE: The U.S. Toy Industry Association says it has taken measure to ensure the safety of toys in the future. They also said, quote, "As an industry and as the companies and individuals who make up our industry, we care very much about the health and safety of the children who play with our toys and of the factory workers that make them." Unquote.
But under current trade agreements it's difficult if not possible for U.S. business executives to inspect the Chinese factories that make their goods.
(END VIDEOTAPE)
SCHIAVONE (on camera): Kitty, contributing to the problem, a steady stream of job and funding cuts at the Consumer Products Safety Commission, leaving those who are assigned to be guardians of consumer safety virtually powerless to do so. Kitty?
PILGRIM: Louise, this is a classic case of government failing to protect the citizens and individuals at this point are pretty much on their own except with some help from groups like Public Citizen to check toys.
SCHIAVONE: That's true, 87 percent of toys in the United States are now imports. Used to be 60,000 people in the United States who made toys back in the 70s. Now there is only 9,000 people who make toys in the United States. So as you say, we're on our own, we go to the store if we're buying for children we just keep our fingers crossed.
PILGRIM: Let's hope the focus stays on it after the holiday season, too.
Thanks very much, Louise Schiavone.
That brings to the subject of tonight's poll. Do you believe that the Bush administration will ever take strong action against communist China to protect Americans from dangerous imports? Yes or no. Cast your vote at loubdobbs.com. We will bring you the results a little bit later in the broadcast.
Santa Claus this year can no longer rely on an American company to tailor his suit. The bright red outfit of Jolly Saint Nick is most likely made in communist China. The last domestic manufacturer of Santa Claus outfits, the Helco (ph) Company, stopped making the suits this year.
Now the company's president tells us there simply isn't the manufacturing base available in the United States anymore. The company's Santa suits have been seen in the movies, at White House events, on television. Helco had been making Santa suits for half a century. And now they simply sell suits made in factories overseas.
Coming up communist China buys a stake in one of the country's most powerful financial institutions, we have a special report on American for sale.
Also many voters remain undecided two weeks before the first primary election. Three top political analysts will tell us what that means for the candidates and their campaigns and the American woman who says she was gang raped in Iraq gives testimony on Capitol Hill. Was there a cover up by the State Department?
The woman's congressman, Ted Poe, will join us.
(COMMERCIAL BREAK)
PILGRIM: An American woman working for former Halliburton subsidiary Kellogg, Brown and Root in Iraq charges that she was gang raped by American contractors working for the companies.
Jamie Leigh Jones claims the U.S. government was involved in covering up this crime and her family went to Congressman Ted Poe for help and today Jones testified before a House Committee.
(BEGIN VIDEO CLIP)
JAMIE LEIGH JONES, FORMER HALLIBURTON/KBR EMPLOYEE: The KBR security then took me to a trailer and then locked me in a room with two armed guards outside my door. I was imprisoned in the trailer approximately for a day. One of the guards finally had mercy and let me use a phone. I called my dad who contacted Congressman Ted Poe who took actions to get me out of the country. I believe he saved my life.
(END VIDEO CLIP)
PILGRIM: Congressman Ted Poe joins me now. Thanks for being with us, sir. You have hearings and the Department of Justice seat and to you, remarks that the Department of Justice had thousands of lawyers, but not one was there. Why do you think that they did not attend the hearings, sir?
REP. TED POE (R), TEXAS: Well, their absence and their silence seems to speak volumes about what they're not doing in this case and similar cases. The Justice Department had the opportunity to be there and answer questions from the members of Congress about what happens when an American citizen like Jamie is a contract worker overseas and she is sexually assaulted by other American citizens. What is going on in those cases?
PILGRIM: Let's remind our viewers how long it's been since this incident occurred and how this woman has not seen any investigation come to a conclusion over this.
POE: This happened in 2005 and after she was rescued and brought back home, we inquired to the State Department to proceed with criminal investigations through the Justice Department and we have not heard anything from the Justice Department that lets us believe no one is in charge of these types of criminal investigations that occur in Iraq and other countries.
PILGRIM: Let me read the letter that the Justice Department sent to the committee in response to the invitation. And they wrote, "We want to advise you that the Department of Justice is committed to the investigation and prosecution of criminal misconduct by U.S. personnel overseas. These cases can be very challenging, but the department has and will continue to pursue them."
The government does have a responsibility to protect American civilians overseas. The Green Zone is under U.S. jurisdiction, is it not?
POE: No question about it. There is not a jurisdiction issue because of the nature of where this crime occurs in the Green Zone, under the control of the State Department. The Justice Department has jurisdiction to prosecute American citizens who commit crimes against other American citizens. There's not a jurisdiction problem at all.
PILGRIM: Do you see this being taken up? Have your inquiries been met with any positive response on the part of any government agency?
POE: We haven't received any answers one way or the other, just general comments as the one that you just read from the Justice Department. But it seems to me that really nothing is going on. This crime occurred two years ago. There are several perpetrators who committed this brutal attack against this very young person who was working over there and no one yet has been held accountable. Nobody has been arrested. Nobody has been prosecuted.
PILGRIM: What is the role of the company that employed this young woman?
POE: The companies overseas have an obligation for workers to have a safe work environment, but really the ball seems to me to be dropped with the Justice Department, who did not investigate the case, apparently at all, until Jamie now has gone public with this case. And now they seem to be somewhat interested, even though they are still not communicating with us about what they're doing, if anything, against these people who committed the crime.
PILGRIM: Jamie testified that every time she goes public, does a broadcast or brings it to the media spotlight, she gets a flurry of activity on the part of some government agencies. When you were last on the broadcast, you urged other Americans who were sexually assaulted by coworkers in Baghdad to come forward and contact your office immediately. What has been the response to that?
POE: Well yes, last week when we were here and talked about that, I have at least four young women who have called us, contacted us, and given us similar stories. They have not talked about it publicly until this show broadcasted the whole case last week. So there's at least four. Now we have learned today that there are even more that have contacted us. So that is what the results have been because she has gone public, other citizens who have crimes committed against them have gone public, contacted us and the same result though, no one has been prosecuted.
PILGRIM: What is the next step towards justice for this young women and others like her?
POE: The very next step is the chairman at the committee, Chairman Conyers, is going to personally contact the attorney general about this case and also Secretary Gates and to see what they're doing to move forward. Congress will then move legislatively if necessary, because the problem seems to be there are so many government agencies in Baghdad, but nobody seems to be in charge of a criminal investigation when it occurs. We're going to make that very clear, that the Justice Department will be in charge and needs to move forward on all cases.
PILGRIM: We applaud your efforts. Congressman Ted Poe, thank you very much, sir.
POE: Thank you, sir.
PILGRIM: When we return, three of the top political minds help us sort out the final push to the Iowa caucuses and beyond. And then, communist China's hacking. The Pentagon says we're safe, but some in Congress are not so sure. And we'll tell you what they plan to do about it. Also, flushed with green. Red China is on the march right down Wall Street. We'll have a special report next. Stay with us.
(COMMERCIAL BREAK)
PILGRIM: A Chinese government investment firm is investing $5 billion in Morgan Stanley. It's just the latest proposed deal that shows American assets are for sale. And the buyers with the cash are increasingly well not your average free market international company. They are foreign governments with their own national agendas. Christine Romans reports.
(BEGIN VIDEOTAPE)
CHRISTINE ROMANS, CNN CORRESPONDENT (voice-over): A $5 billion investment in Morgan Stanley, a stake in Bear Stearns, control of data storage company Iomega and a pending deal for a minority state in with 3com, a company that provides computer security for the Pentagon. All are Chinese government-linked investments in the U.S. economy, a growing trend. Record trade deficits have funneled trillions of American dollars into China's treasury, dollars now coming back to invest in U.S. and European companies.
JOHN TKACIK, HERITAGE FOUNDATION: The thing that I am concerned about is the penetration of our mid-level if not top information technology companies and this is something that is being guided by the Chinese government.
ROMANS: It's not like the 1980s when the Japanese were buying American real estate landmarks, he says. These are government linked purchases of strategic assets. The complicated 3com deal has raised concerns in Congress. Huawei is investing in private equity firm Bain Capital to acquire a minority stake in 3com, the Pentagon contractor.
National security experts say Huawei has close ties to China's military, something Huawei denies.
On the campaign trail, Republican presidential candidate Duncan Hunter had blasted that deal and called for fellow candidate, Mitt Romney, a co-founder of Bain Capital, to oppose it. REP. DUNCAN HUNTER (R), PRESIDENTIAL CANDIDATE: I think that the American people should hold his campaign accountable for teaming up with a Chinese company which has proven itself to be against the interests of American service personnel and American security and purchasing an American defense contractor, 3com.
ROMANS: Romney has not spoken publicly on the deal. Eight Republicans signed House resolution 730, saying the Huawei deal, quote, "should not be approved on national security grounds."
(END VIDEOTAPE)
ROMANS: The Huawei/Bain Capital/3com deal will undergo a national security review. A spokesman for those companies would not say whether that review process has already begun. The Treasury Department as a rule, as you know, Kitty, does no comment on those investigations.
PILGRIM: Yes, there's usually a void of information while the investigation is going on. You know, it's one thing to invest in a financial company. It's another thing for a foreign government to invest in a strategic, dual use technology company, correct?
ROMANS: And that is exactly what John Tkacik at the Heritage Foundation said. He said he doesn't really have any concerns about an investment into a financial company, like Morgan Stanley or Bear Sterns, although there are people who do have concerns about those kinds of deals. But it is the technology that he's very concerned about, about buying up technology assets. And the Chinese have $1.3, $1.4 trillion in foreign currency reserves. There are a lot more of these kind of deals that can come. We have to hope and some say we don't, have a process that will make sure that all of these deals are vetted for national security concerns.
PILGRIM: Thanks very much, Christine Romans.
The Defense Department submits a report every year to Congress on the military power of Communist China and now that report is required to address the issue of China's increasing cyber warfare capabilities.
(BEGIN VIDEOTAPE)
PILGRIM (voice-over): U.S. officials say China wants to dominate cyber warfare. In recent months, suspected Chinese hackers have been trying to breach U.S. government and defense-related computers. Earlier this month, security sources told CNN, the Department of Homeland Security reported an attempt to compromise computers at Tennessee's Oak Ridge National Laboratory. It may have originated in China.
In June, a cyber attack thought to be from China, shut down the Defense Department's unclassified computer system. Even Defense Secretary Robert Gates' computer was hit.
RUSSELL HSAIO, JAMESTOWN FOUNDATION: It was able to paralyze the information network of the Pentagon and that itself is the most important or most critical aspect of the recent developments in its capabilities.
PILGRIM: Earlier this year, the Chinese successfully launched an anti-satellite test which if real and launched against U.S. satellites, would have effectively crippled communication. The communist Chinese government took weeks to publicly comment on the test and Gates met China's President Hu Jintao to get some answers. Afterwards, Gates said he raised concerns with the Chinese, but there was no further discussion.
JOHN PIKE, GLOBALSECURITY.ORG: The anti-satellite test earlier this year was quite frustrating because the report from last year basically said nothing about it. And so you do have to wonder what other Chinese capabilities are being developed.
PILGRIM: This year's report to Congress on the military power of the People's Republic of China says the Chinese military seeks "electromagnetic dominance" as critical to win early in any conflict. "In 2005, the PLA began to incorporate offensive computer network operations into its exercises, primarily in first strikes against enemy networks. The PLA has established information warfare units to develop viruses to attack enemy computer systems and networks."
(END VIDEOTAPE)
PILGRIM: Now this report faces the problem of predicting what the Chinese are developing. For example, last year's report to Congress made no mention of an anti-satellite test. So U.S. authorities were entirely taken by surprise when the Chinese successfully launched one this year.
Well, a reminder now to vote in tonight's poll. Do you believe the Bush administration will ever take strong action against communist China to protect Americans from dangerous imports? Yes or no, cast your vote at LouDobs.com and we'll bring you the results in just a few minutes.
And coming up at the top of the hour, "OUT IN THE OPEN" with Rick Sanchez. Rick?
RICK SANCHEZ, CNN ANCHOR: So much news taking place. We've been following all these developments today, including Kitty, the situation out in northern California. Take a look at some of these pictures that we've just had coming in. This is a family. A dad takes his three kids out to the woods, he's looking for a Christmas tree for them. Well they haven't been able to find them in days and suddenly now a helicopter pilot is flying over, he spots them. He's going to join us. He's going to tell us the story live here on the air, as well as a family member. We will be bringing this story out in the open as it happens.
And then the story, this is like the water cooler story that the whole country is talking about. Show them the picture of Jamie Lynn Spears, if you would. Who does she look like? Britney Spears, right? You're not going to believe this, because of all the troubles that Britney Spears has had, this is her little sister, she is 16, she has got a big show on Nickelodeon that a lot of little girls watch. Again, she is 16, right, Kitty? She is pregnant.
There's a lot of talk about in this story. I mean there's the Hollyweird angle and everything that happens in the world of entertainment. There's also the angle of what's going on with the family and then there is a story about all of us who are parents and need to ask ourselves maybe we need to start thinking about how we deal with our teenagers, maybe give them the right information because one out of 13 girls in this country who are teenagers get pregnant, one out of 13. Back to you.
PILGRIM: Thanks very much, Rick Sanchez. Thanks, Rick. We look forward to it. Still ahead tonight, reports that one Republican presidential hopeful will drop out of the race. And we're going to discuss that and more with three of the best political analysts in the country. Stay with us.
(COMMERCIAL BREAK)
PILGRIM: New evidence tonight of the threat to our democracy posed by unreliable electronic voting machines. Colorado has just decertified thousands of machines across the state. A review by Colorado's secretary of state found many of the e-voting machines have problems with accuracy and security. Now the problems were found with equipment made by three of four providers used by the state. Fifty- two of Colorado's 64 counties are affected by this. The state and the manufacturers say they will work to solve the problems before the 2008 presidential elections.
Tom Tancredo is expected to end his presidential campaign. The "Atlantic Monthly" online reports that the Colorado congressman will drop out of the race tomorrow. Tancredo is a staunch anti-illegal immigration advocate, but while the subject has resonated with the Republican voters, his candidacy has not. CNN/Opinion Research Poll places Tancredo dead last among the registered Republicans in their choice for president. His campaign would not confirm or deny this report, but did confirm Tancredo will hold a news conference tomorrow.
I'm joined now by three of the nation's top political observers. In New York, we have Democratic strategist Hank Sheinkopf; Pulitzer Prize winning columnist for the "New York Daily News" Michael Goodwin and from Davenport, Iowa on the train with the Republican candidates is Jonathan Martin, senior political reporter with politico.com. And thank you all for joining us. And Jonathan, I commend you for taking your hat off but if you get cold during the course of this interview, you can put it back on, it's all right.
As long as you're standing in Iowa, let's start with some polls in Iowa. And we have the ABC News/"Washington Post" Democrat likely caucus goers. We have Barack Obama at 33 percent, Hillary Clinton at 20 (sic) percent and John Edwards at 20 percent. Jonathan, since you have -- you hold the turf, let's start with you. What do you make of this spread?
JONATHAN MARTIN, POLITICO.COM: Well I think in Iowa, you have basically a three-way race among Democrats. This is going to be a real dog fight up until January 3rd. And I think that Obama has really gained in recent weeks, but the endorsement that Clinton got on Sunday by the "Des Moines Register," one of the few papers left in America where the endorsement does carry some weight, will provide her a nice boost. And John Edwards has worked the state very hard and especially in the rural parts of Iowa, has a solid core of support.
PILGRIM: John Edwards has really covered the turf. What are you seeing in terms of activity, Jonathan, just because you're standing there? What are you seeing right now in terms of activity?
MARTIN: Democrats are blanketing the state. It's a bit different, the Democratic race versus the Republican side. On the Republican side, some of the top candidates like John McCain and Rudy Giuliani are not focusing their efforts really much here at all in Iowa. And on the democratic side, this is prime time here, this is where it's taking place. You have all the major Democrats working this state, going to all the small towns and doing this sort of old- fashioned retail style campaigning, and they're all here. And it's day in, day out and it's every corner of the state.
PILGRIM: Michael, it's a very tight race, isn't it?
MICHAEL GOODWIN, NEW YORK DAILY NEWS: It is, but it' also true that they don't all have the same stake in this. I think for example that Barack Obama has to win Iowa. John Edwards has to win Iowa. Neither one of them can afford to finish third.
Hillary Clinton can finish second, but not third. So I think there are different permutations that suit each of them differently. Obama can finish second to Edwards, that would be fine. Clinton can finish second to Edwards, that would be fine. But neither one wants to finish third, that's the big problem.
PILGRIM: Different number of chips on the table with each candidate. Hank, anything to add to this?
HANK SHEINKOPF, DEMOCRATIC STRATEGIST: I think Michael is really correct about this. Hillary Clinton if she doesn't come in first, it's OK, not great. But John Edwards, it's do or die. If he dies here, he's dead.
PILGRIM: Well let's talk about New Hampshire because Clinton has been gaining a bit in New Hampshire, even though she is focusing so heavily on Iowa. And let's take a look at the polls we have now. Democratic primary voters, we have Clinton at 38, Obama at 26, Edwards 14 and Richardson, 8.
Hank, thoughts on that?
SHEINKOPF: Senator Clinton needs to win New Hampshire if she's not going to win Iowa, if the numbers hold up at all. She's got to do that. Momentum is very important going into the other states and momentum has a lot do with this. And momentum in Iowa to some extent will determine electability. Voters tend to follow public opinion data, to a large extent.
GOODWIN: Right, New Hampshire comes five days after Iowa. Not going to be a lot of time, I don't think there are any debates really, maybe some forums in New Hampshire. But basically whoever wins Iowa and comes out of Iowa with head of steam is going to be charging into New Hampshire, particularly if it's Obama or Clinton. And so those numbers may not mean that much.
PILGRIM: And press reports on the wins will make a big difference.
GOODWIN: Absolutely.
PILGRIM: Let's go to the Republican side. Sorry Jonathan, let's just do this quick. And this is primary voters in New Hampshire, Republican. Romney still looks like he's got the lead at 34, McCain 22, Giuliani 16, Huckabee 10. Jonathan, thoughts on that?
MARTIN: Sure, two very interesting things.
First of all, Mitt Romney has kept his lead. He has still got a pretty solid margin there in New Hampshire, where he's really going to need a strong core of support because of his vulnerability now apparently in Iowa to Mike Huckabee. So New Hampshire for Romney, becoming perhaps a firewall.
But secondly what is really fascinating there is that McCain has emerged as Romney's toughest competitor. For awhile it was Giuliani and McCain. Giuliani pulling some money now off the TV there in New Hampshire, focusing his efforts further in the primary process. And McCain has now started to benefit, got some really key endorsements from up there and his numbers are now finally starting to move. So we could have a real battle between Romney and McCain in New Hampshire.
PILGRIM: If Romney wins in New Hampshire, what does that mean for frontrunners Giuliani and Huckabee, national?
GOODWIN: Well nationally Giuliani, I think is in trouble, just as he is in the early states. I mean, he's been slipping. He's done I think OK in the latest poll, but his numbers are about half of what they were four or five months ago. So he's in trouble in the early states. He has to win somewhere.
I think what we're looking at in the Republicans is probably multiple winners in the first states. So maybe Huckabee in Iowa, Romney or McCain in New Hampshire, maybe Thompson or Huckabee in South Carolina. And so it really scrambles that field and doesn't leave it settled whereas I think the Democrats will be much more settled after New Hampshire.
PILGRIM: Thoughts on this, Hank.
SHEINKOPF: Democrats have a much easier way to stabilize this. Giuliani, February 5th I believe he will be gone. I think that there will be a momentum going in after these early states. The problem that he faces in New Hampshire is the polls show the more you meet him, the less you like him. And people have to feel something good about you before they pull that lever.
PILGRIM: And he is betting on the southern push.
SHEINKOPF: He's betting on the southern push, not necessarily going to be there.
GOODWIN: Well Florida is a big state for Giuliani. He is not going to win Iowa or New Hampshire, looks like. Probably not South Carolina and Michigan, he has got the problem in Michigan with Romney's father have been governor there. So everywhere he goes, he has a somewhat different set of opponents, two people in each state kind of lining up against his interests. Florida is a big state for him, but Huckabee is really coming on strong in Florida now.
PILGRIM: We will take a break - oh go ahead, Jonathan, yes.
MARTIN: No, I was going to say Giuliani is basically relying on a chaotic or muddy, if you will, early state scenario. You have multiple winners in different states. It's still sort of uncertain enough. So by January 29th in Florida, he can emerge and use that as his springboard into those tsunami Tuesday states on February 5th. But it's a big gamble and it assumes there are multiple winners in those first contests.
PILGRIM: All right gentlemen, we have to take a quick break. We'll be right back. And some presidential candidates are getting in the holiday spirit. We're going to look at some of their holiday ads when we return with our panel, so stay with us.
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PILGRIM: We're back with Hank Sheinkopf, Michael Goodwin and Jonathan Martin. You know, the candidates have their holiday ads out and some of them are quite intriguing. Let's look at Rudy Giuliani going for humor here.
(BEGIN VIDEO CLIP)
RUDY GIULIANI (R), PRESIDENTIAL CANDIDATE: There are many things I wish for this holiday season. I wish for peace with strength, secure borders, a government that spends less than it takes in, lower taxes for our businesses and taxes and I really hope that all the presidential candidates can just get along.
UNIDENTIIFED MALE: I was with you right up until that last one.
(END VIDEO CLIP)
PILGRIM: Jonathan, does humor work?
MARTIN: Well Rudy figured out a way to get both his campaign message and Santa Claus in the same 30-second spot. So my hat's off to him.
PILGRIM: Michael, what do you think?
GOODWIN: I didn't find it that funny.
SHEINKOPF: There was nothing tremendously funny there. I mean, ho ho ho.
PILGRIM: Not a knee slapper. Let's look at Hillary Clinton's holiday ad. It's an intriguing one too.
(BEGIN VIDEO CLIP)
SEN. HILLARY CLINTON (D-NY), PRESIDENTIAL CANDIDATE: Where did I put universal Pre-K? Ah, there it is.
(END VIDEO CLIP)
PILGRIM: An attempt to bring up serious issues in a light way. Jonathan?
MARTIN: It's the exact same thing. These guys can't get off messages. They have to keep talking about their issues, but they just want to do so with a bow on top if you will.
PILGRIM: Do you really think, Michael, the American public needs to have these holiday ads? I mean, it does seem like a bit of a force to me.
GOODWIN: Yes, I don't know why they didn't just take some few days off or stay with the straight - at least for a few more days. I mean Christmas is next week. You could go through this week, I think, in a fairly serious vain. Do biography things, kind of sentimental things. But these jokey ones I don't quite get.
PILGRIM: It is the nature of this campaign with all these early primaries, that these candidates are just going for the punch line.
SHEINKOPF: People would really rather see television ads advertising products that they need to buy, because they really don't need to buy these candidates on Christmas. Too much already, go home.
GOODWIN: They can't disappear, though, either.
PILGRIM: Jonathan, let's look at the Obama ad. We're going to put that one up now.
(BEGIN VIDEO CLIP)
SEN. BARACK OBAMA (D-IL), PRESIDENTIAL CANDIDATE: In this holiday season, we're reminded that the things that unite us as a people are more powerful and enduring than anything that sets us apart. And we all have a stake in each other in something larger than ourselves. So from our family to yours, I'm Barack Obama and I approve this message.
UNIDENTIFIED FEMALE: Merry Christmas.
UNIDENTIFIED FEMALE: Happy Holidays.
(END VIDEO CLIP)
PILGRIM: More of a Christmas card there, Jonathan, right? MARTIN: It was a cute spot there at the end although the first part of it was still his message. He is not talking about issues, but Obama is talking about matters of hope and the kind of lofty aspirations. That's his whole pitch.
GOODWIN: I thought the family actually was a softer touch despite what he was saying. I wasn't really watching or listening to him. Seeing the kids and his wife I thought did soften it and make it more biographical.
SHEINPOKF: The Barack Obama spot was the best of the three. You know why? It was really human and it made sense. It was in context.
PILGRIM: OK, the panel has voted. All right thank you very much. Hank Sheinkopf, Michael Goodwin, Jonathan Martin, thank you.
Now the results of tonight's poll, 99 percent of you do not believe the Bush administration will ever take strong action against communist China to protect Americans from dangerous imports.
We have time for one last e-mail. Linda and Dalton in Idaho: "Dear Lou, your common sense is so refreshing. My 17-year-old and I watch you ever night, and when he turns 18 and registers, he and I will be Independents."
Thank you. We love hearing from you. Send us your thoughts at LouDobbs.com. Each of you whose e-mail is read here receives a copy of Lou's new book "Independents Day: Awakening the American Spirit."
Thanks for being with us tonight. Please joins us tomorrow. For all of us here, thanks for watching. Good night from New York. "OUT IN THE OPEN" with Rick Sanchez starts right now. Rick?
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