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Lou Dobbs Tonight

New York Governor Eliot Spitzer Fights for his Political Career; Mortgage Blame Game; Presidential Politics and H-1B Visas

Aired March 10, 2008 - 19:00   ET


LOU DOBBS, CNN ANCHOR: Thank you, Wolf.
Tonight Governor Eliot Spitzer of New York is fighting for his political life after reports he met with at least one prostitute. Governor Spitzer apologizes to his family and the public, but refuses to acknowledge what he did wrong or to quit. We'll have all of that, the latest on the presidential campaign and of course all the day's news straight ahead here tonight.

ANNOUNCER: This is LOU DOBBS TONIGHT: news, debate, and opinion for Monday, March 10. Live from New York, Lou Dobbs.

DOBBS: Good evening, everybody. Governor Eliot Spitzer tonight is refusing to resign after he allegedly met with a prostitute in a Washington hotel. A source tells CNN that Governor Spitzer's involvement with the prostitute was caught on a federal wiretap.

In a statement Spitzer apologized for his conduct but did not confirm nor deny that he met with a prostitute. Governor Spitzer's political opponents immediately calling for his resignation. The Republican Governors Association said it is time for what it called honest leadership. We'll have complete coverage here tonight. We begin with Mary Snow reporting from New York.


MARY SNOW, CNN CORRESPONDENT (voice-over) "The New York Times" headline linking New York Governor Eliot Spitzer to a prostitution ring was so shocking New York reporters at first thought it was a joke, but soon after Spitzer with his wife by his side made this public statement.

GOV. ELIOT SPITZER (D), NEW YORK: I have acted in a way that violates my obligations to my family that violates my or any sense of right and wrong. I apologize first and most importantly to my family. I apologize to the public whom I promised better. I do not believe that politics in the long run is about individuals, it is about ideas, the public good, and doing what is best for the state of New York. But I have disappointed and failed to live up to the standard I expected of myself. I must now dedicate some time to regain the trust of my family.

SNOW: Spitzer, a father of three daughters took no questions and said he would report back in short order. Two sources with knowledge of the investigation tell CNN the New York governor allegedly met with a prostitute in a Washington hotel. The charges are especially shocking since the New York Democrat had built a reputation fighting corruption on Wall Street while he served as attorney general. "TIME" magazine even called him crusader of the year. His political star rose when he was elected in 2006.

SPITZER: So I pledge to toil each and every day so as to not disappoint the hard-working people of this state who have placed their trust in this future.

SNOW: For now Spitzer is calling this a private matter.


SNOW: Now Spitzer made no indication that he would step down. If he does, Lieutenant-Governor David Paterson would become governor. Now among lawmakers expressing shock tonight is fellow Democrat Governor Jon Corzine of neighboring New Jersey, he calls these allegations serious and disturbing saying they're completely at odds with the man I know -- Lou?

DOBBS: And the reality is that his office has made no indication whatsoever, has indicated in no way that he plans to step down. Despite what would be not a personal affair, but rather a violation of law, if indeed, these allegations are true.

SNOW: Yeah, we checked in with his office within the past hour asking a press officer there, is he going to step down? Is he going to be making a statement? There were some rumors he might speak at 7:00. The press office said no, that was not going to be happening and that he did not indicate. They just referred to his statement made earlier today, saying that he made no indication he would step down.

DOBBS: All right, thank you very much, Mary Snow.

Governor Spitzer came into office promising tougher ethical and moral standards. But Spitzer quickly faced charges that his office tried to smear New York Senate Majority Leader Joseph Bruno. Spitzer also took me on, on the issue of giving away driver's licenses to illegal aliens. The good governor believed that was a great idea until he was forced to back down and retreat from his position.

Spitzer's poll numbers simply collapsed during that episode from 69 percent when he was elected in November 2006 to just 25 percent following that episode. Well CNN tonight has learned that federal investigators have wiretap evidence that links Governor Spitzer with a high-end prostitution ring. A knowledgeable source telling CNN that Spitzer is identified as quote, "client number nine." And he met with a prostitute in Washington on the 13th of February, the day before, of course, Valentine's Day. Kelli Arena has our report from Washington -- Kelli.

KELLI ARENA, CNN JUSTICE CORRESPONDENT: Lou, sources say that there is wiretap evidence because this was part of a larger investigation, takedown of a very high prostitution ring known as the Emperor's Club VIP. Charges against four people involved in that ring were unsealed last week.

And the feds say it charged between 1,000 and more than $5,000 an hour depending on the prostitute. The criminal complaint has a great deal of detail, Lou, and it does mention a client nine which sources do tell us refers to Governor Spitzer. The complaint says that client nine arranged to meet with a prostitute, as you said on the night before Valentine's in Washington, D.C.

A source tells us that the encounter took place at the Mayflower Hotel. It's a very upscale establishment here, Lou. Client nine allegedly asked to be reminded of what the prostitute looked like, was told that she was American, 5'5", 105 pounds, so it certainly wasn't his first time. There was also allegedly a great deal of discussion about payment because client nine owed some money.

And a detailed plan laying out how the prostitute was going to get into his hotel room. Now after that alleged meeting the prostitute spoke to her supervisor said client nine wasn't a problem. Things went very well and that he paid her $4,300. Now one source tells us that the IRS was first tipped off to this whole thing when it was investigating a money laundering scheme and noticed payments coming in from what this source called a high-ranking official.

Sources say investigators will now look into where Spitzer allegedly got the money, how he made his payments, and whether he broke any banking laws. The IRS was the one that brought the FBI into the investigation, Lou, and that's where we stand now.

DOBBS: Thank you very much, Kelli Arena reporting from Washington.

Joining me now to analyze what this scandal will likely do and the impact it will have on the governor's conduct and his career, two of the finest political analysts anywhere, Democratic strategist Hank Sheinkopf who can tell us how the Democratic Party is reacting right now and how it is likely to react and Pulitzer Prize winning columnist Michael Goodwin of the "New York Daily News" who has been of course reporting on Spitzer's career for years.

Both Hank and Michael, thank you both for being here. Let me start out by just turning first to the issue of this client nine. Hank Sheinkopf, what do you make of that?

HANK SHEINKOPF, DEMOCRATIC STRATEGIST: Let me respond to the whole thing in a different way. This is a tragedy for that family. That's the first thing that comes to mind. And I have been involved with public figures who have melted down, some very serious scandals in this country professionally and it is never pleasant to see anything like this. To be called client nine after the kind of career he has had to be known forever as client nine is an extraordinary thing for this man.

DOBBS: Does this suggest to you there is far more at work here than simply engaging the services of a prostitute for pay? SHEINKOPF: Based upon the facts as we know them today, there may very well be and then there may not. We don't know enough, but I think competent criminal counsel would certainly have an opinion about it.

MICHAEL GOODWIN, "NEW YORK DAILY NEWS": Lou, if this was a local police bust somewhere, you know perhaps he gets a misdemeanor, a listing on the john list, but this is a federal investigation, involving the IRS and U.S. attorney and the southern district of Manhattan, so this is not going to go away easily.

And that's why I think ultimately Spitzer will have to quit if it is not tonight it will be tomorrow or three days or three weeks. But he can't withstand this because just in the reports of Kelli Arena and Mary Snow, there are so many questions that come out, right? Was this the first time? How did you pay? How many times did you show up on the wiretap? Why did you owe money? What for? Did you use government credit cards, government e-mails. I mean there are so many things here.

DOBBS: Movement of money. Wire fraud...


DOBBS: Communications.

GOODWIN: Yeah, so I mean apart of the crimes there is just the pattern of conduct that will come out, so there is no way he can withstand this.

DOBBS: On the issue whether it be -- whether wire fraud would be one of the considerations for the prosecutors or not. Where is the Democratic Party tonight? We have not heard a rally to the defense of this governor in any way from any part as far as we are aware of any part of the Democratic Party?

SHEINKOPF: When these things happen, first of all, people go into a state of shock especially with this fellow. Not expected under any circumstances. This is the sheriff of Wall Street and how far he has fallen. Democratic Party is probably trying to catch its breath. This is not a national issue. It's an issue only because Eliot -- nationally because Eliot Spitzer is prominent. His national career was over the day the trooper gauge (ph) stuff started. So that being said, where does it go now, now it is about the destruction of one man and whether New York State will have a new governor and when.

DOBBS: You don't think it ended with the driver's licenses for illegal aliens?

SHEINKOPF: Well I think that was the final straw.


DOBBS: Well there is somebody who did however foresee this for whom it wasn't unexpected and you and I are seated next to him...


DOBBS: Michael Goodwin writing in the "New York Daily News" on the 14th of October had this to say. I don't know if we have this up as a full screen, but I want to read it. And he was talking about it -- writing about this in your column, concerning trooper-gate.


DOBBS: The rapid unraveling of Spitzer's tenure. Now remember this is back on the 14th of October of last year. The rapid unraveling of Spitzer's tenure is starting to resemble another political collapse, Jim McGreevey, like Spitzer, the New Jersey governor, won in a landslide and was soon up to his neck in nonstop corruption scandals, lousy government, and a shaky relationship with the truth. I mean that's about as clear, clear and prescient a statement as one could expect.

UNIDENTIFIED MALE: Well it was well written too...


DOBBS: Don't overdo it here, Michael.


DOBBS: I'll give you a lot of credit, but don't...



DOBBS: Your modesty is certainly not in the equation is it?

GOODWIN: No, look, Spitzer has been I think a huge disappointment almost from day one of being governor. As you said, he did promise this kind of great sweeping change day one. And from day two he has had nothing but trouble that he created himself and you asked Hank earlier about where is the Democratic Party? They abandoned him long ago. None of them will rally around him now because none of them trust him.

SHEINKOPF: He has no friends. In public life in order to get things done you have to have friends.

DOBBS: In life period.

SHEINKOPF: Well public life particularly.

DOBBS: because no one, no one...


DOBBS: ... forgive me, gets where they are, stays where they are by themselves.

GOODWIN: My father long ago told me, he said be careful how you treat people on the way up the ladder because you'll meet them on the way down.

DOBBS: And may we all have lots of friends no matter the circumstance.


DOBBS: Obviously, Governor Spitzer, in great need of. I've got to say one thing. Michael Goodwin went on to say, and I think this is worth pointing out, that Spitzer is not as far gone as Governor McGreevey at that point but he is moving downhill faster and earlier than McGreevey did. Unless he gets his act together, he could meet the same end and have the same legacy that a New Jersey political scientist pinned on the disgraced McGreevey. He wasted the governorship.

Thank you very much, gentlemen. We appreciate your insight, Hank Sheinkopf and Michael Goodwin.

Also the subject of our poll tonight, the question is straight forwardly, do you believe New York's governor, Eliot Spitzer, should resign. We'd love to hear from you on this. Yes or no? Cast your vote at We'll have the results upcoming.

Next here the mortgage crisis is worsening, political and corporate elites refusing to take responsibility. Christine Romans will have our report -- Christine?

CHRISTINE ROMANS, CNN CORRESPONDENT: Lou, the housing downturn is out of control and all the fingers point at someone else -- Lou.

DOBBS: Christine, thank you very much. We look forward to that report.

And big corporations rushing to replace well paid American workers with cheap foreign labor and as quickly as possible. We will have that report.

And the Clinton-Obama campaigns well they are struggling to end their deadlock over the Florida and Michigan primaries. I will be talking with influential Governor Ed Rendell of Pennsylvania here next. He'll give us his ideas on how to fix this. Stay with us. We'll be right back.


DOBBS: Well this economy remains in turmoil and our mortgage crisis continues to worsen. So far, the nation's banks, mortgage lenders and realtors have refused to accept their responsibility for creating this crisis in the first place. Some corporate elites in fact are blaming the struggling homeowners themselves. Christine Romans has our report.


ROMANS (voice-over): A housing downturn out of control and all the fingers point at someone else. ANDREW JAKABOVIC, CENTER FOR AMERICAN PROGRESS: To the extent we are seeing a sort of a circular firing squad of all the players there is some reason that wherever the blame is being pointed it's accurate but that doesn't absolve the person who is doing the finger pointing.

ROMANS: Countrywide is under federal investigation for its role in the housing meltdown. It wrote many of the home loans that Americans can no longer afford. But the embattled CEO blames falling home prices.

ANGELO MOZILO, FORMER CEO, COUNTRYWIDE FINANCIAL: The primary cause for increasing delinquencies and foreclosures is that for the first time since the great depression there is a nationwide deterioration in single family real estate values combined with now increasing unemployment.

ROMANS: The CEO of realtor RE/MAX International blames the big banks.

UNIDENTIFIED MALE: Wall Street probably is more to blame than anybody.

ROMANS: For packaging and reselling risky loans as investments, he also blames speculators.

DAVE LINIGER, REMAX INTERNATIONAL: A very significant number of the foreclosed properties were non occupant owners who bought them as investments. And they're just literally walking away from the mortgage payment.

ROMANS: New York's attorney general has accused appraisers of inflating home values in collusion with lenders. Some home buyers say their mortgage brokers encouraged them to overstate their earnings. And banks and mortgage companies pedaled fancy new types of loans for virtually no money down with adjustable rates.

UNIDENTIFIED FEMALE: I think we couldn't afford the house to begin with and the bank gave us the loan that we couldn't afford.

ROMANS: All under the nose of banking regulators.

SEN. CHRISTOPHER DODD (D), CONNECTICUT: Where were the regulators, why didn't they do more. Were they asleep at the switch?

ROMANS: Senator Dodd blasted federal banking officials charging they neglected their banking oversight and consumer protection duties.


ROMANS: Instead the focus for many years has been on pushing record homeownership but without effective policing of the marketplace, record homeownership has now become, Lou, record foreclosures and record pain for American homeowners.

DOBBS: With all apologies to Senator Dodd there, Christine, perhaps Congress bears some responsibility as well? They have an oversight of -- responsibility to prod if you will those regulators to move into the markets and to be regulating those institutions.

ROMANS: We asked where the responsibility lies. I'll tell you it is mostly the homeowners who say wow I feel stupid or oh I should have known. You don't hear anybody else taking the blame.

DOBBS: Well one hopes that everyone in this country will begin to assess, irrespective of whether you're Republican or Democrat, liberal or conservative, that there is a role for government regulation in these markets and to watch over these institutions for precisely the reason that we are living through right now.

ROMANS: All we heard about was financial market innovation and how it was going to make us all richer and happier, Lou.

DOBBS: Unbelievable. Well I guess I shouldn't say unbelievable because by this point after having seen so much of it I should say believable, but it still, it continues to just shock me of what we can -- what we can permit in this country. Christine, thank you very much, Christine Romans.

Rising prices across the board are eroding the incomes of middle- class Americans. Crude oil today continued its climb. Crude oil hitting almost $108 a barrel and that will drive up the price of nearly every product in the economy. Food prices are soaring as well, driven higher by those higher energy costs.

Eggs are up 30 percent, milk, dairy and baked goods up as much as 8 percent last year. And corn now in high demand as a fuel source in addition to being much needed in our food supply, it has risen 50 percent. And the United States Department of Agriculture now says prices are likely to continue, that climb for at least the next year.

New evidence today that prescription drugs are ending up in the nation's drinking water, traces of antibiotics, mood stabilizers and sex hormones among the pharmaceuticals found in the water supplies of 41 million Americans. That is according to an investigation by The Associated Press.

And I want to say right now, absolute compliments and commendation to The Associated Press, which is one of the few news organizations in this entire country carrying out serious investigative journalism, the AP's findings raising serious questions about how municipalities are able to keep our water safe.


MAE WU, NAT'L RESOURCES DEFENSE COUNCIL: The thing is there are a lot of different treats techniques for treating water and the water utilities aren't required to use every single technique that's out there and so there is no one process that can get rid of all of these chemicals.

(END VIDEO CLIP) DOBBS: Most of the chemicals, the pharmaceuticals entered the water supply through human waste according to that report by the AP. But local utilities insist the water supply is safe. The federal government says it is a growing concern however, but doesn't require any testing, nor has it set any safety limits for pharmaceuticals in the water supply.

Well pollution it is a new sin according to the Vatican. The Vatican saying it is bringing its list of sinful behavior up to date. Genetic manipulation and economic injustice will also be considered sins now. According to the Vatican, the new sins are behaviors that damage society as a whole not just the individual. A church official added that bioethics hold the greatest danger to the modern soul.

Up next big business moves to bring more cheap foreign labor into this country replacing American workers, we'll have that report.

And the tight Democratic race for the presidency could lead to new primaries in Florida and Michigan. Influential Pennsylvania Governor, Democrat Ed Rendell joins me.

And will New York's governor, Eliot Spitzer, face criminal charges for allegedly meeting with a prostitute and perhaps more? We'll examine that issue and a great deal more straight ahead. Stay with us.


DOBBS: It just goes on and on. Corporate America is now demanding the right to import more cheap labor from overseas into this country to replace American workers. Bill Gates is expected to push Congress to raise the limit of H-1B visas as he did last year. Microsoft is just one of dozens of tech companies lobbying Congress now for more of these visas, a plan supported by each, each of these presidential candidates regardless of party. Bill Tucker has our report.


BILL TUCKER, CNN CORRESPONDENT (voice-over): The message from CompeteAmerica, a lobbying group for coalition of multinational corporations is clear. They're demanding more H-1B visas for highly skilled individuals.

ROBERT HOFFMAN, COMPETEAMERICA: The choice is really simple. If the labor pool isn't there, if we can't find the people with the skills that we need to work in the United States then we have to consider our options overseas.

TUCKER: Presidential candidates McCain, Obama and Clinton all support that demand. What CompeteAmerica ideally wants is summed up in last year's Senate testimony by Microsoft's Bill Gates.

UNIDENTIFIED MALE: Even though it may not be realistic I don't think there should be any limit. TUCKER: The current cap is 65,000 plus another 20,000 for foreign students with graduate degrees. The Programmers Guild, the coalition of high tech workers, is fighting any increase noting they have experienced members with graduate degrees being overlooked for work.

KIM BERRY, PROGRAMMERS GUILD: They need more H-1Bs because they need to hire the new graduates out of school. Well these people have no experience, so if that's what they need they could just as well take these people with 10 or 20 years of experience, hire them as new grads, give them the same training.

TUCKER: Supporters of this current guest worker program say it is for the brightest and the best, but that's not how the visas are awarded. They are awarded by random lottery.

VIVEK WADHWA, HARVARD UNIVERSITY: You have got scientists. You have got doctors competing with low-level programmers. And it does not discriminate. Everyone is feeding from the same dish here. It puts the best (INAUDIBLE) at a disadvantage.

TUCKER: That is not the only flaw. Four government-produced reports in 1996, in 2000, in 2003, and again in 2006, document problems with the program. In several independent reports show H-1B tech workers are typically paid less than an American worker doing the same job. And incredibly, eight of the top 10 users of the program are not American companies.

(on camera): Critics of the H-1B program point to that fact as well as the most recent jobs report as indications that we don't need to be giving away increasingly scarce American jobs.

Bill Tucker, CNN, New York.


DOBBS: And those eight of 10 companies that are receiving the H- 1B visas, they're not receiving them to do business, for example, somewhere else. They're doing it so that they can outsource domestically as well as internationally good paying American jobs.

Well the deadline for application for H-1B visas is April 1, April, Fool's Day and a record number of visa petitions are expected this year. Last year the United States received more than 120,000 visa petitions over two days. That is nearly the double the cap of 65,000.

Time now for some of your thoughts. Tom in California wrote in to say "The arrogance of our politicians these days is appalling. Governor Spitzer while trying to cram illegal driver's licenses down the throats of New Yorkers and indeed the rest of America is simultaneously involved in illegal prostitution."

Debra in Washington, "Lou, regarding the Spitzer story, those girls are doing jobs most of us won't do. We need to bring them out of the shadows and give them a path to legalization after paying a fine. Those opposed to their legal status are sexist. Well, it works for the illegal aliens!" We take your point.

And Jean in New York, "Lou, this is one for the books. Mr. Moral man, pro illegal alien, sanctuary city with a gold spoon in his mouth Spitzer now involved in prostitution. Well, Mr. Spitzer it's time for you to go and maybe with any luck our great New York City will lose its sanctuary status and do what the people want. He was and has been doing what he wanted! Legal and illegal, now let's get someone who will do what the people of New York want."

We'll have more of your thoughts here later. Each of you whose e-mail is read here receives a copy of my book "Independents Day: Awakening the American Spirit".

And please join me for our radio show each afternoon, "The Lou Dobbs Show", every week day from 3:00 to 6:00 p.m. Eastern. You can log on to to find the local listings for "The Lou Dobbs Show". We hope you will listen in.

Up next, the very latest on the sex scandal that could force New York Governor Spitzer out of office, I will be joined by three of the very best political analysts.

And Senators Clinton and Obama, they're still at it battling for every convention delegate. Will Florida and Michigan do a redo? I will be talking with one of the nation's most influential politicians, certainly one of its most influential governors, Governor Ed Rendell of Pennsylvania.

And late-breaking developments in the scandal over the Pentagon's refusal to give Boeing that huge tanker aircraft contract, a leading congressional opponent of the Pentagon's decision joins us here tonight. Stay with us. We're coming right back with that and a great deal more.


DOBBS: Democratic presidential candidates are fighting for every convention delegate of course. New demands for a new primary vote in both Florida and Michigan, the earlier primaries voided by the Democratic national party for moving those primaries up.

Pennsylvania's Governor Ed Rendell has proposed a plan to allow voters to be heard. He joins me tonight from Scranton, Pennsylvania. Governor, good to have you with us.


DOBBS: I am great. I think most Americans, whether Democratic, Republican or Independent think the folks in Michigan and Florida should be heard. What do you think?

RENDELL: Absolutely. I mean, first of all, you can't punish the people for things that politicians did. The people of Florida and the people of Michigan have a right to weigh in on what is the closest nomination battle in a long, long time. And for Democrats, it's silly because one of the big four states in the fall, as you know, Pennsylvania, Ohio, Florida and Michigan. For Democrats to win, we have to carry at least three out of four. How can we disenfranchise Florida, Floridians and Michiganders and expect them to support us in the fall? Makes no sense at all.

DOBBS: If you've come up with a way you think that those primary elections could be held reasonably, efficiently and well?

RENDELL: Well, Governor Crist and Governor Granholm have both said they would be willing to have revotes in their state. But that they can't afford the cost of a second primary.

So Governor Corzine and myself and a lot of other people like James Carville and others have said let the campaigns, let good Democrats from around the country weigh in and raise the money to finance what it would cost for Michigan and Florida to have these revotes.

I think it is roughly $30 million, less than $30 million. If the two campaigns did it themselves, that is about 10 days of fund-raising for the two campaigns combined on the Internet, as unbelievable as that is. But you wouldn't have to do it straight out of the campaign because you wouldn't be encumbered by federal election laws because this money would be going to the states.

So you could get people to give at a far greater level. I think Democrats from around the country want to see Florida and Michigan vote.

DOBBS: Well at this point, you are supporting Senator Clinton. Do you suppose that Senator Obama may have misgivings about you and Senator Corzine, also a supporter of Senator Clinton leading that effort?

RENDELL: Well, I was on another network with Tom Daschle, who is supporting Senator Obama and he said he thought it was fair and something that the Obama campaign would have to consider. Look, if you are Senator Obama and you hope to be the nominee in the fall, what good is it to win the nomination and have people in Florida and Michigan so angry they're not going to come out and support us.

DOBBS: I want to turn the subject if I may because labor is an important part in Pennsylvania. The idea that the United States government is awarding a contract to Airbus instead of Boeing -- is there any way in the world that you can imagine that that makes any sense?

RENDELL: Lou, what they have done is so wrong and so inappropriate. It is really unspeakable. First of all on the merits, Boeing has far more experience. Airbus has done none of these tankers.

Secondly, over the course of the cycle of, life cycle of these tankers, Boeing will come out cheaper because of energy use. But aside from that, I don't know if your listeners know, they probably do since it's your show. But we are suing, the United States government is suing Airbus in front of the WTO for unfair subsidies. How can we give the second biggest contract in defense history to someone we are suing for unfair trade practices? That would be like -- Pennsylvania or any other state giving state contracts and state business to people who don't pay their taxes.

DOBBS: Great news about this broadcast, Governor Rendell, is I have to keep up with the audience. They are demanding -- demanding to have this thing squared up. Let me ask you, the news about Governor Eliot Spitzer. So far refusing to resign, the allegations of meeting with a prostitute. Your thoughts tonight?

RENDELL: Well, first I am very saddened because Eliot Spitzer is - and I don't agree with everything he does from a policy standpoint, but he's a very talented person. So I am very saddened by this. I am saddened especially for his wife and family. How this gets resolved, I think, before we rush to judgment. I heard some of the e-mails I think we need to know a little bit more about what the extent of his involvement was. It's my understanding that wasn't cleared up today. But I think before we rush to judgment, we have got to get all the facts on the table.

DOBBS: Governor Ed Rendell. As always, thank you for being with us.

RENDELL: Thanks, Lou, keep fighting.

DOBBS: Thank you, sir. We will.

Up next, much more on the tanker bill. Boeing protesting the award of the air force tanker contract to the European consortium that produces the Airbus. I will be talking to one of those fighting this inane decision, Congressman Todd Tiahrt joins us. He's a leading critic of the contract and he joins us.

And New York's Governor Eliot Spitzer caught up in allegations of being involved in a prostitute sex ring that could end his career. We'll hear what our distinguished panel of political analysts have to say about all of that and a great deal more. Stay with us. We're coming right back.


DOBBS: Boeing tonight announcing it will seek an independent review of the Pentagon's decision to award Europe a huge tanker aircraft contract from the Air Force Department. Boeing lost that contract to EADS. Boeing saying its proposal would have created or secured 44,000 jobs in this country.

Congressman Todd Tiahrt of Kansas says the Pentagon is "outsourcing our national security" and joins me now. Congressman, good to have you with us.

REP. TODD TIAHRT (R), KANSAS: Lou, it is great to be with you and let me first thank you for putting my Web site up on your television station. I've got 250,000 hits on that Web site because of you. Thanks. DOBBS: Well, thank you. And I understand that we actually crashed your site to begin with. I apologize for that. But all is well that ends well.

I want to say to you, thank you for taking on this issue and I'm going to say that to you -- as a republican congressman, for you to be siding with workers in this country is a delight to me because I frankly don't think the Democrats do enough. The Republicans talk in abstractions and institutional terms, but not in terms of workers. It is a delight to have you tell the Air Force this administration that American jobs matter.

TIAHRT: Yes, they do. And you know, we made this such an unleveled playing field for American companies, it is just absolutely wrong. We have got all these barriers that we've created on this specific contract, why it is such an outrage we're not only outsourcing our national security, but we created a situation where an American manufacturer can barely win.

DOBBS: How so? How so?

TIAHRT: Three of the four last big contracts - we should have suspected it when we lost the bid to give the president's helicopter, Marine One, a new face. That went to a foreign manufacturer. Then the light utility helicopter went to a foreign manufacturer. Now, all of this unlevel playing field is as plain as the nose on your face.

This air refueling tanker goes to a foreign manufacturer and it's because we don't count for illegal subsidies. We don't account for legal subsidies. We don't make any consideration for the loss of jobs and we give Europeans a benefit on waivers, on regulations. So it's definitely going to cost more money to build the same product in America as it does in Europe.

DOBBS: I have actually, I didn't think I would say this with less than a year running, but I truly believe this, congressman, that if this contract goes ahead, then every congressman and woman who supports it, every senator who supports it, and this president, there should be absolute recalls and impeachment because this is the death now of American national security and it is that serious in my opinion. Do you disagree?

TIAHRT: Well, I wouldn't support you on impeaching the president of course. But I would support you in creating American jobs. And you know the federal government has done so much to prevent us from creating and keeping jobs. It's like a wall keeping us from bringing jobs back into America.

And if we don't change the rules and make it a level playing field, we're going to continue to see jobs outside of national security go overseas, as they have been doing for the last 10 years.

Now, you and I may disagree on free trade. I support free trade, but only when it's fair. And it's very clear in this instance, it is not fair. DOBBS: Congressman, you know, this is one of the things -- there is no one who supports free enterprise democracy more than me. There is no one including you or the CEO of any company in this country that is more of a capitalist than I am. But I don't believe in unfettered capitalism and I believe in looking at the facts.

And the facts are that corporate America has had it - let me put it this way - has been remarkably confused. This administration has been remarkably deceitful in talking about free trade. You talk about fair trade. Name the last free trade agreement that is fair. Name the last time this administration made a lick of sense in terms of the facts on what is happening to our trade deficit. And then to outsource as you put it national security on a U.S. Air Force contract for tankers and to turn away from Boeing, one of the leading corporations in the entire world, is insane.

TIAHRT: It is an absolute outrage. We have created these barriers. If I had time to explain this, I would tell you how the federal government is driving jobs overseas. It's just not companies that are making decisions to go overseas. There are costs they can't control costs - costs that are driven by the federal government and we're doing nothing to eliminate or reduce those costs.

DOBBS: Congressman Tiahrt, governors or my mind tonight with Governor Rendell being with us. He said it straightforwardly, you are saying it straightforwardly. We have got to start making sense out of what we are doing in this country when it comes to American jobs. Congressman, at the risk of crashing your site again, we are going to put up that Web site.

TIAHRT: Thank you.

DOBBS: And we thank you for everything you are doing for the American worker. Congressman Tiahrt, thank you.

You can connect, go to his Web site at if we can put that up, his Web site will be -- you can get a link at That will take you straight to his Web site. Congressman Tiahrt, again thank you. We appreciate everything you are doing.

TIAHRT: Thank you, Lou.

DOBBS: Up next, will New York Governor Eliot Spitzer resign in the face of the growing sex scandal? And how likely is a dream ticket? Is that Clinton-Obama, Obama-Clinton? We'll be talking with three of the best political analysts about that and a great more here next. Stay with us.


DOBBS: Joining me now, three of the very best political analysts and three of my very favorite political analysts. Republican strategist, former chairman of the Huckabee campaign and LOU DOBBS TONIGHT contributor, Ed Rollins, welcome back, Ed. And "Pulitzer Prize" winning columnist, "New York Daily News" and LOU DOBBS TONIGHT contributor Michael Goodwin. And Democratic strategist, LOU DOBBS TONIGHT contributor Robert Zimmerman, Democratic national committeeman. Robert is also a Senator Hillary Clinton supporter for all of you supporting Senator Obama at this point. They can do this. Whatever is necessary.



DOBBS: Just gets better and better. Well since you are the most recently arrived, let me ask you. Senator, senator, Governor Spitzer, can he survive this? Governor Spitzer, can he survive this?

ED ROLLINS, REPUBLICAN STRATEGIST: No, absolutely. There's no way he can survive it. As the story will unfold in the next 24 hours, in all probability he committed a crime. If the facts are correct and he moved this prostitute from New York by train to Washington, that's violation of the act, which is a felony. And you know it's -- there is wire, money being transferred. All the facts aren't out there. But as they're being reported, there is no way you can survive. Plus, you know not only is he a hypocrite, basically he may well very end up be a charged felon.

GOODWIN: I think it's likely that he basically is holding the governorship as hostage in the negotiations over a plea deal. It's the one thing he has to trade right now is his job. So perhaps that's why he didn't resign today. That's speculation. But there is a sense in Albany that he is trying to negotiate a plea deal. What does he have to offer? His job.

DOBBS: What do you think?

ZIMMERMAN: You know, obviously the facts are going to come out in the next several days. The story will be told. If the facts are as we suspect, it's very hard to imagine him staying in office. This is such a tragedy not just for his family, but for the state. And his statement today didn't do us any - didn't do his case any good or help the state. His reference to this being a personal tragedy. It is one for the state, not just for his family.

And the other point is, when he talked about the idea that politics is not just about men, it's about ideas and vision. It takes men of character to make those ideas and visions reality. He didn't get it.

DOBBS: I have to say, you all are the experts here. But to see Governor Spitzer standing up there with, his poor wife behind his right shoulder. He does not introduce her. He does not acknowledge her. Her head, she is downcast. And then he is talking as Robert says about this is the politics isn't about individuals. What in the world was going through their minds?

ROLLINS: I have been around this business for 40 years. I'm always amazed by the hypocrisy and the idiocy. And this is pure, unadulterated idiocy. This is a guy who wanted to be president, not just governor. He wanted to be president. And he goes down to testify before a congressional hearing, arranges for a prostitute to meet him there, day before Valentine's Day. Then he puts his poor wife up there, which is just a pathetic sight to watch. I think our hearts go out to her and the kids. It's just outrageous behavior for a leader.

GOODWIN: And Lou, it could be too that the wife is there merely to protect him. That she's there because through her eyes, we look at it as a tragedy. If he is there alone, there is not much of a tragedy, and there's just a lot of anger at this jerk. So who knows if she is not just a prop to protect him?

ZIMMERMAN: Silda Spitzer is not a prop. I know you didn't mean it disrespectfully, Mike, but she is not a prop. She is an incredibly accomplished woman and a bright woman and clearly was there out of love for her husband and support and I give her credit for that, as I do for what she has contributed.

But I will tell you something. The reason I use the word tragedy is because he showed such potential as attorney general and through arrogance.

DOBBS: Do you think he survives?

ZIMMERMAN: No, I don't.

DOBBS: Do you think he should survive?

ZIMMERMAN: If the facts as are they appear to be, no, I don't. I think we have to let a next day or two to pass for the facts to come out.

DOBBS: Implication for the national political party? And implication if any for Senator Clinton or Senator Obama?

ZIMMERMAN: I think ultimately this situation with Governor Spitzer involving a prostitute is not going to have national ramifications. And I think to a great degree, the presidential campaign is going to be much bigger in this situation in New York.

DOBBS: Let me ask you this -- turning to a new subject and that is the dream ticket which involves Robert Zimmerman's candidate and this dream ticket between Senators Obama and Senator Clinton. Much discussion from the Clinton side apparently without consulting the Obama side.

ROLLINS: The last time I looked, Obama had more votes, he had more delegates. So usually before you negotiate for second, you are in first. So I think to a certain extent he batted it back. It was a stupid thing to do. It may be a dream ticket, but they've got a long ways to go and no one can tell -- this guy is still winning. And there is no reason for him to basically say, OK, you beat me.

DOBBS: We'll be right back with the dream team here on national politics. Reminder first if I may, to vote in our poll. Do you believe New York Governor Eliot Spitzer should resign? Yes or no? We'd love to hear from you. Cast your vote at We'll have the results for you in just a few moments. Coming up at the top of the hour, "The Election Center" with Campbell Brown. Campbell, let me guess - no, I won't guess. What are you working on tonight?

CAMPBELL BROWN, CNN ANCHOR: What are we working on, Lou? If there's any other story at the top of the hour, it is an explosive combination, sex and politics. We are going to have the latest on the federal investigation into New York Governor Eliot Spitzer's alleged night with a high-priced prostitute. We'll also though going to pay plenty of attention to presidential politics. Barack Obama is warning followers that the Clintons are trying to hoodwink you. We're going to tell you why he is so upset and we'll see you at the top of the hour.

DOBBS: Thank you very much, Campbell. And we'll be right back with our panel of all starts right here, next. Stay with us.


DOBBS: All right Robert Zimmerman, in just a moment we're going to turn to that other political party, even though your party seems to be dominating all of the top of the mind issues these days.

Governor Rendell, just here talking about getting the redo in Miami, in Florida and in Michigan. What do you think?

ZIMMERMAN: What I think is I'm fed up with the Clinton campaign and the Obama campaign and the Democratic National Committee all posturing about what has to be done.

There has to be a revote in Michigan and Florida. We don't need anymore posturing. We don't need to have fundraising online. We've got to have the resolve to do it and I am just fed up with the fact that no one is coming together to really protect the voting interest of the two states.

DOBBS: One question -- how is it the Democratic Party leadership and the Democratic National Committee by implication were so stupid as to come up with this situation, allow the situation to be created. So stupid as to come up with this punishment and how the candidates were so stupid to sign on to the disenfranchisement of the voters of Michigan and Florida in the first place?

ZIMMERMAN: Is that multiple choice?

DOBBS: Pick any one.

ZIMMERMAN: It's great to be back.

DOBBS: Great to have you.

ZIMMERMAN: The reality is the state governments of Michigan and Florida chose to jump the calendar. They were wrong. The problem is the Democratic National Committee and campaigns were not resourceful enough to negotiate a deal. That's the travesty here. ROLLINS: The travesty is your chairman, Howard Dean, who has never been able to lead his party effectively. It was a compromised choice to begin with and I think to a certain extent didn't represent the mainstream of your party.

DOBBS: By the way, who is the head of the Republican National Committee?


GOODWIN: Do they have one?

ROLLINS: It's someone new today.

ROLLINS: Mike Duncan is the chairman. A guy named Frank Donatelli is a wonderful, wonderful guy who is going in to run it for John McCain. Donatelli is an old friend of mine and a great, great talent.

GOODWIN: I'd like to - Lou, I'd like to congratulate Robert. I think he's made perfect sense tonight. He went after Eliot Spitzer, said he shouldn't resign. He's going after Hillary Clinton's campaign and the whole DNC. I think it's wonderful.

ROLLINS: Democrats for McCain.

ZIMMERMAN: I'm just a populous, Independent Democrats. That's all there is to it.

GOODWIN: A straight talking Democrat.

DOBBS: One of my very favorite Democrats as well. But in all serious, the courage to not go along with the high-bound orthodoxies that make up both political parties. I join Ed in that. And Ed knows that we have pretty high regard for him too, his ability to rise above partisanship. You have no need to do so. You're a journalist. Let me ask you this. Could we get it more screwed up than we've got it this year?

GOODWIN: Well, it's odd because in many ways it is the most exciting campaign in the long time. The issues are enormously complex. And of course the candidates are both attractive and flawed at the same time. And yet this process -- we're talking so much about process instead of the issues and the solutions to the problems. That's the problem. We're bogged down in process now both in reality and in our conversations.

DOBBS: This campaign at this point has two sides to it. This is not always obvious because of all the attention focused on Senators Obama and Clinton. There's a Republican component, a fellow by the name of Senator John McCain. What in the world is he doing? Is this going to be an advantage or disadvantage as we watch this battle in the Democratic Party?

ROLLINS: Let me just assume to say, I think John McCain now has some time to go put a team together. He came from nowhere. This is the guy who was the front runner for two years.

DOBBS: He's trying to get back there.

ROLLINS: Now he's going to go raise money. Now he's going to put a team together. A long, long ways to go here. And my sense is anyone who underestimates John McCain, this is a guy who was tortured not only by Vietcong, he was tortured by his own party and he's now the nominee. It's now his party for the foreseeable future.

ZIMMERMAN: That's a very important point. If you look at the most recent "Newsweek" poll, the idea of John McCain running on the record of the most unpopular president of modern times is running even with Barack Obama and Hillary Clinton. That tells you that Democrats have a lot of work to do and too many of them are taking this race for granted.

GOODWIN: I also think McCain needs to become better on the economy. He's running as a national security candidate. And I think the economy is going to bite him if he isn't careful about it.

DOBBS: Michael Goodwin, Robert Zimmerman, old friend Ed Rollins. Good to have you back.

ROLLINS: Nice to be back, thank you.

DOBBS: The results of our poll tonight, 85 percent of you say New York's governor, Eliot Spitzer, should resign.

Time now for some of your thoughts.

Steve in Montana saying: "These idiots that gave the tanker contract to another country must have been flying at high altitudes without an oxygen mask. This is un-American and they should lose their jobs."

And I agree with you 100 percent.

Paul in Arizona: "I don't like having a corrupt government, but I can live with it. I am having problems accepting government that is both corrupt and stupid. I registered as an Independent last year.

Good going. Let's hope everybody joins up. We love hearing from you. Send us your thoughts at Each of you whose e-mail is read here receives a copy of my book "Independents Day: Awakening the American Spirit."

We thank you for being with us tonight. Join us here tomorrow. Among our guests will be Congressman Barney Frank, chairman of the House Financial Services Committee, who is working on new, much-needed legislation to help prevent home foreclosures and to mitigate the pain of millions of American families.

For all of us here, thanks for watching. Good night from New York. The "Election Center" with Campbell Brown begins now.