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Lou Dobbs Tonight
Liberal Media Bashes Governor Palin; Lobbyists Share Blame for the Financial Crisis; Democracy at Risk
Aired September 30, 2008 - 19:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
LOU DOBBS, HOST: You've got your work waiting for you. Thank you very much, John. Tonight, Senators Obama and McCain announcing they're determined to thwart the will of the people. They say they're going to save the massive Wall Street bailout. We'll have complete coverage.
And tonight, charges that this nation's most powerful lobby, the U.S. Chamber of Commerce, helped create this housing and financial crisis. We'll tell you how in our special report.
And tonight, country origin labeling finally going into effect for some of our food. But still gaping holes in the federal government's food safety program, so-called.
And among my guests tonight, two leading Congressman who have had a belly full of efforts to ram a Wall Street bailout down the throats of Congress and the American people. All of that, all the day's news and much more, from an independent perspective, straight ahead here tonight.
ANNOUNCER: This is LOU DOBBS TONIGHT: news, debate, and opinion for Tuesday, September 30th. Live from New York, Lou Dobbs.
DOBBS: Good evening, everybody. Senators McCain and Obama today joining forces, defying the will of the people and trying to save that massive Wall Street bailout that Congress just rejected. McCain and Obama both acting as cheerleaders for the Bush administration and the Democratic Congressional leadership.
Congress receiving so many e-mails from their constituents, nearly all of them opposing this bailout that a House of Representatives Web site crashed. Some lawmakers who voted against the bailout today introduced their own legislation trying to re- regulate the markets and tackle our financial and housing crisis.
We have extensive coverage tonight and we begin with Ed Henry in Washington who is following the McCain campaign.
(BEGIN VIDEOTAPE)
ED HENRY, CNN WHITE HOUSE CORRESPONDENT (voice-over): Advisers to John McCain say he's tired of being a political punching bag over the failure of the bailout, so he's fighting back.
SEN. JOHN MCCAIN (R-AZ), PRESIDENTIAL CANDIDATE: Yesterday, the country and the world looked to Washington for leadership and Congress once again came up empty handed.
HENRY: McCain trying to shift blame away from himself for parachuting in on negotiations, but he was careful to only take aim at Congress as a whole, never slamming Barack Obama by name, trying to strike a bipartisan tone.
MCCAIN: I think I need to talk to America and hear what their solutions are because we're going to have to get the support of all Americans to address this together.
HENRY: Leaders in both parties want to pivot out of the debacle of Monday's finger pointing to show voters they're ready to work together. Democratic sources say Senate Majority Leader Harry Reid was planning to rip McCain in a speech Tuesday morning. But pulled back.
SEN. HARRY REID (D-NV), MAJORITY LEADER: The blame game needs to end. And we need to move forward on doing what's right for our country.
HENRY: To that end, McCain declared that, like Obama, he supports raising the FDIC insurance limit from $100,000 to $250,000, as a way of reviving talks on Capitol Hill. But the partisanship is far from over. As McCain spoke in positive tones, his campaign released a new ad alleging Obama and other Democrats sparked the crisis by not reigning in Fannie Mae and Freddie Mac.
UNIDENTIFIED FEMALE, CAMPAIGN COMMERCIAL: "The Post" says, McCain pushed for stronger regulation while Mr. Obama was notably silent.
(END VIDEOTAPE)
HENRY: Now Senator McCain also said today that inaction is not an option, so he's clearly casting his lot with either this bailout version or an updated version of it, despite the fact that many of those Republican no-votes from yesterday do not appear to be changing, especially with the Capitol switchboard overwhelmed right now with angry constituents saying they're not in favor of the bailout. Lou?
DOBBS: Yeah, it's no question about the fact that the safe vote was the yes vote. Eighteen of 22 Republican Congressman who are retiring voted for this bailout, so I mean that's really remarkable. And why in the world strategically has Senator McCain chosen to align himself with Senator Obama and push for this Wall Street bailout, which Congress has rejected? This makes literally no sense either in terms of principle or in terms of tactical politics, Ed.
HENRY: People close to the McCain camp insist two reasons. They cite one is that as you heard Senator McCain saying inaction is not an option. That while this is not a perfect piece of legislation, clearly he feels that something needs to be done.
And secondly, with about 10 percent of the electorate roughly undecided in this very tight election, the McCain camp is estimating that the thing they don't want to see, those voters in the middle, is sort of all this partisan sniping we saw yesterday on both sides. And so that's why we heard him talk about bipartisanship, finding solutions.
DOBBS: Yeah.
HENRY: Obviously, a lot of people who don't like this solution, but he still says he's pushing ahead for one, Lou.
DOBBS: Well, you know and with that he may be pushing his campaign right over the edge, along -- it's hard to say at this point, but it makes literally no sense whatsoever. And it's always great when you hear something reduced to aphorisms like action -- inaction is not an option. That's as close as people apparently in Washington, D.C. can come to understanding the issues. Thank you very much, Ed Henry.
Senator Obama, for his part, is also aggressively, well, selling the bailout to the American people. Senator Obama refuses to acknowledge that the American people and the representatives have spoken. He says it's time for that Wall Street bailout plan to be pushed through, no matter what. Jessica Yellin has our report.
(BEGIN VIDEOTAPE)
JESSICA YELLIN, CNN CONGRESSIONAL CORRESPONDENT (voice-over): Today, Barack Obama is selling the so-called financial rescue package to two audiences. To voters he argues the bill will help working families.
SEN. BARACK OBAMA (D-IL), PRESIDENTIAL CANDIDATE: What it means is if we don't act, it will be harder for you to get a mortgage for your home or the loans you need to go to college or a loan you need to buy a car.
YELLIN: And to members of Congress, he says it's time to compromise.
OBAMA: To the Democrats and Republicans who opposed this plan yesterday, I say step up to the plate. Do what's right for this country.
YELLIN: The Democrats floated one idea he believes could win more votes. Currently, the government insures up to $100,000 in bank accounts. Obama proposes increasing that federal insurance to cover up to $250,000. He's calling it:
OBAMA: A step that would boost small businesses and make our banking system more secure and help restore confidence by reassuring families that their money is safe.
YELLIN: Obama says the fiscal crisis is an outrage and he promises changes will come.
OBAMA: But while there's plenty of blame to go around, and many in Washington and Wall Street deserve it, all of us now have a responsibility to solve this crisis because it affects the financial well being of every single American.
(END VIDEOTAPE)
YELLIN: As you know, Lou, many Americans, as you and Ed were discussing, remain unconvinced that the bailout is necessary and the Obama campaign says well President Bush is to blame for the opposition. They argue he just hasn't done a good enough job of selling the bailout plan. So Obama is taking it on himself to persuade working families that this isn't a bailout of Wall Street, but a rescue effort that would affect their bottom line. Lou?
DOBBS: Unbelievable. I mean the thinking in the Obama campaign in no way superior to that of the McCain campaign. Let me see if I've got this right. Senator Obama wants to raise the FDIC guaranteed deposits to $250,000. He thinks that's going to bring him more votes.
These are the very same people he says that he's going to raise taxes on, those people who are making the kind of income who would have over a quarter of a million dollars in the bank. Who in the heck is doing his economic thinking now?
YELLIN: Well just to tell you what his aides say to me, that's targeted at small businesses. It's not at individual people who own 250, it's for small businesses that keep that cash on hand in the bank.
DOBBS: Well, fascinating. I think we're getting quite a bit of information now as we approach election day. We're learning more and more about these two men that I have to believe the American people are finding very, very interesting. Thank you very much, Jessica Yellin.
Well if Senators Obama and McCain have any doubt about the stale of opposition to this bailout, they should try taking a look at their own e-mails. Millions of e-mails have flooded Capitol Hill. Nearly all of them, and I mean nearly all of them, from voters who are simply furious with the very idea that Congress would even think about bailing out Wall Street.
Voters sending in so many e-mails, constituents sending in so many e-mails to those Congressman and senators that the Web site for the House simply crashed. Officials have now sharply restricted access by constituents to that site. And by the way, if you want to send an e-mail to your Congressman or senator, well you can go to our Web site, which is fully operational and from there you can dispatch your e-mail to your Congressman, your senator, to your president, to whomever you want to. Fully operational, loudobbs.com, there to help you send off a note to the relevant parties on Capitol Hill.
Well there's been no shortage of mistakes and gaffes on the campaign trail. But in this campaign, liberal media elites are not treating these candidates equally. Far from it in fact. Much of the national liberal media in fact has been hammering Governor Sarah Palin for her so-called gaffes. They have all but ignored the blunders of Senator Joseph Biden just days before Thursday's vice-presidential debate. Lisa Sylvester has our report, fair and balanced. (BEGIN VIDEOTAPE)
LISA SYLVESTER, CNN CORRESPONDENT (voice-over): There's been plenty of blunders on the campaign trail. This one from Senator Joe Biden.
SEN. JOSEPH BIDEN, (D-DE) VICE PRESIDENTIAL CANDIDATE: When the stock market crashed, Franklin Roosevelt got on television and didn't just talk about the, you know the princes of greed.
(BUZZER)
SYLVESTER: Wrong. Franklin Roosevelt wasn't the president during the stock market crash. Herbert Hoover was and in 1929, Americans didn't watch TV, they listened to radio. Here's another one. Biden sounds like he's going to take down his own running mate.
BIDEN: I guarantee you, Barack Obama ain't taking my shotguns, so don't buy that malarkey. Don't buy that malarkey. They're going to start peddling that to you. I got two. If he tries to fool with my Beretta, he's got a problem.
SYLVESTER: Senator Biden's gaffes fly into the radar of mainstream media, but "Washington Post" and CNN media critic Howard Kurtz says Governor Sarah Palin's seem to be magnified.
HOWARD KURTZ, CNN CONTRIBUTOR: There's a tremendous disparity between the coverage that Joe Biden and Sarah Palin are getting. When Biden makes a mistake, it is nowhere near the big story that's endlessly repeated the way it is when Governor Palin does so.
SYLVESTER: "Newsweek" editor and CNN analyst Fareed Zakaria wrote a sharply-worded editorial that Palin wasn't ready to be vice president. A point he reiterated on CNN.
FAREED ZAKARIA, CNN ANALYST: It's not that she doesn't know the right answer, it's that she clearly does not understand the question.
SYLVESTER: But Palin's defenders say the liberal elite media is being plain nasty. And Sarah Palin's approval rating as Alaska's governor is a strong 68 percent because she has something that counts with voters.
BRIAN DARLING, HERITAGE FOUNDATION: If you look at Sarah Palin, she's not a career legislator, she's a real person who got involved in politics and I think most Americans look at her and can more identify with Sarah Palin than any of the other candidates running for federal office.
(END VIDEOTAPE)
SYLVESTER: Sarah Palin said quite confidently that she's not only ready but willing and able to serve as vice president and she has a message that resonates with voters. And keep in mind, Lou, as governor of Alaska, she actually has more executive experience than any of the other candidates in this race. Lou? DOBBS: I think we can say it, all three of them, including John McCain. It's fascinating that there is this just venomous, venal, petty, nasty response on the part of the liberal national media to Sarah Palin. I mean, whatever her shortcomings, and we all have them, my God, it is so unfair, so obvious in its bias, that the national media, there seems to be no limit to what it's willing to do to attack this woman.
SYLVESTER: Well, there certainly have been a number of these interviews and the McCain campaign says this is essentially gotcha journalism where they're trying to put her on the spot. But we have seen that in some cases that's even backfired. You know cases like for instance the passport, you know she came out and said you know lots of people, lots of Americans don't have passports and can understand her answer, which she said look, I was working two jobs, I wasn't backpacking through Europe at the time, so she really does have a message that resonates with those voters.
DOBBS: Yeah, you know I really -- I wonder about this, but as you reported and as we're documenting here, the fact is my guess is that Joe Biden's gaffes, mistakes, blunders have to outnumber hers by somewhere in the neighborhood of five or six to one. Does that seem like a reasonable ratio to you?
SYLVESTER: Well I can tell you there are a lot more of these gaffes of Biden that are not being necessarily being reported. Another one was, for example, where he said he was in Iraq and he was essentially fired upon several times shot at I think is the way he phrased it. Well, then later on you know the campaign cleaned it up a little bit, that there were shots fired near him, so a number of those things like that, but they're not necessarily reported, Lou.
DOBBS: So maybe there's that gender bias working here as well in the liberal -- you know it's turning out that it seems like the liberal national media has a lot of problems with gender, doesn't it? I mean it's fascinating.
You'd think the little darlings would take some sensitivity training or something, wouldn't you? You don't have to answer that, Lisa. Thank you very much. Outstanding reporting as always. Lisa Sylvester.
That brings us to the subject of our poll tonight. Do you believe it's time for the liberal national media to take note that Senator Biden has made far more misstatements than Governor Palin? Yes or no. I guess I should have asked here tonight that what do you think -- he should step aside for someone else on the ticket, but that's another conspiracy theory to bring up at another time. Cast your vote at loudobbs.com. We would love to have your vote here and we'll have the results later in the broadcast.
Up next, some lawmakers determined to stand up for the will of the people, you know the way they do it in a democracy, rule of the majority and all of that. They're presenting now a new plan to tackle our financial housing crisis that won't involve a bailout of Wall Street. I know -- I know the folks on Wall Street are getting a little nervous about that, but nonetheless, we're going to bring you two of the lawmakers who are putting forward just exactly that plan.
Also, did lobbyists representing corporate elites help create this crisis? Goodness gracious, we'll have that report.
And new food safety rules are now in effect, rules that raise new questions about our entire food safety system. Stay with us. We're coming right back.
(COMMERCIAL BREAK)
DOBBS: Remember all the talk of doomsday, if that bailout for Wall Street was rebuffed? Well, Wall Street today rebounded. After a record-breaking point loss yesterday, the Dow today climbing almost 500 points, recovering much of that 777 points lost in yesterday's plunge. The market recovering about $800 billion in market cap.
The dollar also soaring against major currencies today as those folks who suggested there was a collapse and a meltdown imminent because of the rejection of the Wall Street bailout were proved to be complete idiots. The government's actions in this financial crisis has done nothing to build confidence in economic, financial or political leadership.
From the Bush administration to both Houses of Congress, to the campaign trail, fear mongering is the message of the day. They've tried to talk down these markets and this economy for two weeks. As they tried to ram that bailout down the throats of the American people.
(BEGIN VIDEO CLIP)
HENRY PAULSON, TREASURY SECRETARY: I am convinced that this bold approach will cost American families far less than the alternative.
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: Government intervention is not only warranted, it is essential.
BEN BERNANKE, FEDERAL RESERVE CHAIRMAN: I believe if the credit markets are not functioning, the economy will just not be able to recover in a normal, healthy way.
SEN. JOHN MCCAIN (R-AZ), PRESIDENTIAL CANDIDATE: If we do not act, every corner of our country will be impacted. We cannot allow this to happen.
OBAMA: This is a critical time for everyone, Democrats and Republicans need to come together to help to save the lives of the economy.
REP. NANCY PELOSI (D-CA), HOUSE SPEAKER: I think everybody knows that we must intervene. And so we will act and we will act deliberatively and in a bipartisan way and soon.
SEN. JUDD GREGG (R), NEW HAMPSHIRE: Getting this done soon, promptly, is absolutely critical to the confidence of the markets.
SEN. HARRY REID (D-NV), MAJORITY LEADER: We're going to get this done and stay in session as long as it takes to get it done.
(END VIDEO CLIP)
DOBBS: Well, they stayed. And fortunately for the nation, Congress did get it done. They blew out the Wall Street bailout, reasoning winning out. Members of Congress listening to their constituents for a change and telling the Democratic leadership of this Congress and their president that all of that fear mongering, all of that talking down of this great country, our economy and our markets was for naught.
And today, the rally proved both on Wall Street and international currency markets that the United States Congress was right to reject that Wall Street bailout. The U.S. Chamber of Commerce has been a principal lobbyist behind all of the nonsense that we've witnessed over the past couple of weeks and it's been under fire for its role in the nation's crisis itself.
A new report charges that the Chamber of Commerce lobbied for corporate practices that may have led to this crisis directly. And that member companies of the Chamber now stand to profit. Imagine that. Bill Tucker has our story.
(BEGIN VIDEOTAPE)
BILL TUCKER, CNN CORRESPONDENT (voice-over): In the midst of the current financial crisis, a new report from the American Association for Justice puts the blame for Wall Street's disaster on what it calls an aggressive lobbyist.
Quote, "The U.S. Chamber of Commerce is hoping that few will remember that for the past decade it shamelessly led the fight to eliminate corporate accountability, one of the major factors that led to the current financial crisis."
The report charges the Chamber with trying to protect reckless financial institutions that committed sub prime fraud. Fought prosecutions of corporate executives, sued the Securities and Exchange Commission to block reforms and measures designed to protect investors and mutual funds and argued for greater deregulation, among other things.
The lobbyist group responsible for the report represents trial lawyers. The U.S. Chamber declined our request for an interview, but provided this written statement saying quote, "The U.S. Chamber of Commerce representing millions of businesses of every size has been a leader in efforts to strengthen corporate accountability improve transparency in boardrooms and ensure a vibrant economy. We are not interested in responding to the irresponsible allegations of the national trial lawyers' lobbying organization, allegations designed only to further their own narrow political agenda."
(END VIDEOTAPE)
TUCKER: And speaking of political agendas, it was the CEO of the U.S. Chamber of Commerce, Tom Donohue, who back in 2002, said, and I quote, "there is no right for business to go to government to take care of their follies and their errors." Lou?
DOBBS: Well that's where they are right now...
(CROSSTALK)
DOBBS: And by the way, there is something ironic and I think terrifically funny about the Trial Lawyers Association being locked up with the biggest business lobby, the Chamber of Commerce.
(CROSSTALK)
DOBBS: Maybe they can have a discussion about tort reform while they're at it. I mean this is -- the Chamber of Commerce has subsumed their voice of CEOs all across this country. I've said for sometime, I'm one of those people that's pro business and pro labor. And if people can't handle competing values in their minds contemporaneously, then there's something wrong. Because the American people do understand the role of labor, the role of business and the importance of -- to our economic system.
But this is madness what the Chamber of Commerce has embarked upon, this push against (INAUDIBLE) against regulation, against accountability, and for them to suggest they've been for accountability is the height of well, absurdity. We've got to come to better than this. And that means that CEOs of major corporations have got to stand up on themselves, not behind the veil of the Chamber of Commerce or the Business Roundtable, but stand up as business leaders have in the past and speak for the interests of the country, the community, their workers, their stake holders.
That has been absent throughout all of this. Let's hope somebody finds the courage or just the simple sense of duty to do so. Bill Tucker, thank you very much.
We'll have much more on this financial crisis and the intelligent ways in which to address it. None of which have been of course considered so far by this administration or Democratic leadership in Congress. I'll be talking with leading economic strategists and author David Smick and members of Congress proposing a new plan. Get ready, it doesn't include billions of your taxpayer dollars to bail out all of those folks on Wall Street.
Congressman Peter DeFazio and Congresswoman Marcy Kaptur join me. They're leading that effort. And our democracy at risk, dangerous new laws threatening the integrity of our voting process just five weeks before the election. Does anybody care whether or not the people are registering to vote are doing so legally? Well apparently not the courts. We'll have that report and more. Stay with us. We're coming right back.
(COMMERCIAL BREAK)
DOBBS: A presidential election now 35 days away. Election fraud still posing a dangerous threat to this democracy. Perhaps even worsening. Early voting began today in Ohio. After the State Supreme Court there ruled that absentee voters could register and cast their ballots on the same day. As Kitty Pilgrim now reports, that new law could lead to massive election fraud in that critical swing state.
(BEGIN VIDEOTAPE)
UNIDENTIFIED MALE: You're here to vote, let's go vote. They opened up early.
KITTY PILGRIM, CNN CORRESPONDENT (voice-over): In Ohio today, new rules allow one-stop voting. From now until October 6th, new voters can register to vote and cast an absentee ballot at the same time. But how can all those new registrations be checked before the votes are counted?
KEVIN DEWINE, DEP. CHAIR. OHIO REP. PARTY: There's a great opportunity for people who otherwise shouldn't be allowed to vote to be able to cast a ballot and we think that with the crush of other election activities that are going on in Ohio, that the Board of Elections workers, we think they're going to be hard pressed to get through and take care of all of the verification.
PILGRIM: No photo ID is required. New Ohio voters have only to write down the last four digits of their Social Security number or write down their driver's license number. They can also register with the utility bill, cell phone bill, bank statement or paycheck, even college ID if those documents include name and address. Ohio Secretary of State, Democrat Jennifer Brunner, changed the rules on absentee voting by directive.
LARRY WOLPERT (R), OHIO ST. REPRESENTATIVE: There wasn't anything voted on. The General Assembly did not vote on this. The people's representatives did not vote on this. She issued a directive and said this is the way it's going to be. That's the reason why we had to sue in court.
PILGRIM: The Republicans lost their suit against the rule in the Ohio Supreme Court. They charge the Democratic secretary of state changed the rules to usher in scores of new voters for presidential candidate Barack Obama. She denies the charge. The secretary of state's office estimates that a quarter of all votes cast in this election, more than a million and a half, will be absentee ballots.
(END VIDEOTAPE)
PILGRIM: Now Secretary of State Brunner's office today said there are safeguards for checking the registration of new voters. They're satisfied with the proof of identity requirements, but critics say election boards are unprepared to register and check this quantity of new voters just before an important election, Lou.
DOBBS: Has everybody lost their minds? There's no way for these volunteers to check that. I mean it's an absurdity.
PILGRIM: Yeah, the officials we spoke to today say the county boards are just overwhelmed with the volume that they have to do at this point. It's such a big election.
DOBBS: Well, it is a big election, important election, but apparently no one cares about that. Kitty, thank you very much. Kitty Pilgrim.
Well, Ohio is one of more than 30 states, believe it or not, that allow registered voters to vote early. Eight states, Iowa, Maine, Minnesota, Montana, New Hampshire, North Dakota, Wisconsin and Wyoming all allow their voters to not only register, but register and cast -- register and cast their ballots right on election day. Pretty convenient. That's what we like in a democracy, convenience.
Up next, troubling new concerns about our broken food system. Safety, don't worry about it. New safety rules aren't even close to being enough. We'll have a special report. Two lawmakers join me They say they've got a rescue plan for our financial system that won't cost taxpayers a dime. George Bush, Nancy Pelosi, Senator Harry Reid, they won't be interested in this. But I'll bet you will. Stay with us, we'll be right back.
(COMMERCIAL BREAK)
DOBBS: This breaking news just in to CNN. The Senate will vote on a massive $700 billion Wall Street bailout tomorrow evening. That vote scheduled, it will come two days after the House of Representatives voted down that Wall Street bailout, sending a powerful message to the Bush administration and the Democratic leadership in Congress, which apparently the Senate leadership now wants to ignore. The House is due to reconsider the bill again Thursday after the Jewish holiday. Again, the Senate will be voting on the Wall Street bailout tomorrow evening.
Meanwhile, a group of House Democrats today proposing an alternative plan to deal with this financial crisis. Announcing a five-point plan, they call this legislation the no-bailout act. The plan calls for government regulators to step in and regulate the markets rather than a taxpayer bailout of Wall Street. Congressman Peter DeFazio of Oregon and Congresswoman Marcy Kaptur of Ohio leading the new effort, and they join us now. Good to have you both here. What will be the cost of the taxpayer of your new plan, congresswoman?
REP. MARCY KAPTUR (D), OHIO: Our plan doesn't cost anything because we oriented toward the market, not the government. And we follow the plan that was used back in the '80s and late '70s for the Resolution Trust Corporation, with all of the troubles back then, 3,000 bank failures, hundreds of agriculture banks, continental Illinois bank failure, inflation at 21 percent. And over 3,000 banks were resolved. Frankly, all the banks in Texas were closed. But at that time, William Isaac, who was chair of the Federal Deposit Insurance Corporation developed a net worth certificate as well as procedures so that $100 billion worth of resolution was accomplished for $1.8 billion out of the insurance fund of the FDIC.
DOBBS: Congressman, let me ask you here, have you had any reaction from the House leadership at all, the speaker to this plan? Because as Congresswoman Kaptur said, it's reminiscent of the Resolution Trust Corporation. It also sounds like it draws on some of the experience from the early '90s in both Sweden and Finland as suggested by Bill Isaac, former head of the FDIC. Is there any truth to that? REP. PETER DEFAZIO (D), OREGON: Absolutely. And what we're offering them is something that enjoys broad Republican support, should enjoy broad Democratic support. Let's try the minimalist, regulatory approach. Now, the markets spoke before we voted down that plan yesterday. If you read "The New York Times" today, they say actually liquidity and lending froze up yesterday in anticipation that the Paulson bailout would pass. I think the Paulson bailout is based on a false premise, shoveling this money into bad debt on Wall Street is going to solve this problem.
DOBBS: Can I ask you both something? The head of the Congressional Budget Office said this idiotic bailout of Wall Street was likely, was likely to cause a deeper crisis than the one that we're currently going through. Why isn't anybody paying attention to this in either the White House, the Democratic leadership or the campaign trail? Both Obama and McCain act like they have no knowledge of what the heck is going on here.
KAPTUR: They haven't really identified the basis of the problem. Our banking system is fundamentally sound. This is a credit crunch and a housing foreclosure challenge. They haven't identified the root cause. We can deal with the credit crunch through changes in accounting standards. The Securities and Exchange Commission today, as a result of the work that we've been doing so much over the last week and a half, to try to get them to look at those accounting standards is the reason that our local banks are short on credit to re-evaluate those standards and then to deal with the home foreclosure crisis in a way that it matters on Main Street, locks in on Main Street.
DEFAZIO: Lou, you know, credible economists say to us, look, if you adopt Paulson's plan, you throw this money at the top on Wall Street under the premise it will free up credit among the banks, which many of them question, 400 at least, they say but it definitely doesn't go to the root of the problem in housing. And what do you do when housing values go down and there's another trench of maybe another trillion dollars of bad securities on Wall Street and Paulson comes back for more money or the next treasury secretary? We've got to try something else.
DOBBS: We should point out here, just so everybody keeps it straight, no one has any idea of the so-called toxic securities, no one has any idea how many of these there are in the system, period. We have no idea, nor can the Treasury Department suggest what the number is. Some people have estimates but we know we're being low balled right now, right?
KAPTUR: Lou, we know 75 percent of the sub prime loans are good and performing -- 25 percent that may have trouble, we're not sure what the composition of those are, but we should put those into a special housing trust corporation where we can work them out with bank examiners in a way that we did back in the '80s and be very disciplined and prudent about the way we do this.
DOBBS: Two questions and one is sort of a statement as my want from time to time. One is, there can't be much excitement because you're not calling for taxpayer money in the leadership or the White House. And that will upset Henry Paulson because he won't be able to take care of his buddies on Wall Street. But the second part of this is, will we have public hearings? Will you actually invite the American public to have a voice here? Will you actually put together hearings in which we can hear competing viewpoints on this issue from the world's best -- the country's best informed experts?
DEFAZIO: Look at it this way. We got a lot of experts who back this approach, doesn't cost anything. Why not try this and if this works, great. If it doesn't work, that would give us time to go through the regular process with hearings, hearing from the American public, looking at getting at the underpinnings of this crisis. And then if we're going to put taxpayer money on the line, having a much better way of doing it. But maybe we can do it without putting the taxpayers on the line.
KAPTUR: And Lou, among those experts, 9 would like to invite Raymond Stall (ph) from my district in Vermillion, Ohio, who basically says "let all the Wall Street people hurt just like the rest of us normal people do. I don't owe them a living. Corruption and poor management brought on all of this. If these people were to be fired and prosecuted and put into prison, then that might be one thing. But to allow the same people to be in charge makes no sense to me or anyone else."
DOBBS: You know what? I think he sounds like an expert to testify anywhere. I like the sentiment. Is this bailout plan, I mean, the arrogance of the Senate, the arrogance of these two presidential candidates, Obama and McCain, demanding that this legislation be passed, this Wall Street bailout, is this thing going to die tomorrow?
DEFAZIO: I hope so. I hope the Senate has the guts to stand up for the people they represent. I've already talked to a few senators called me today, Maria Cantwell from Washington is very interested in our approach and says she's taking it to Judd Gray (ph).
DOBBS: Good.
KAPTUR: You know what I hope for, Lou? I hope for one courageous senator who will filibuster for the sake of the nation.
DOBBS: You know --
DEFAZIO: Maybe two.
KAPTUR: Maybe two.
DOBBS: So they can stay rested, because they've got a lot of fools to work against in that Senate. I would hope that there's enough courage there. The House proved itself to be filled with men and women who are willing to stand up for what's right and to turn down the special interest and the ignorant, arrogant leadership of your House, the Senate, and of course, the fellow over at 1600 Pennsylvania. Thank you both. It's an exciting proposition. I wish you all the best.
KAPTUR: Oh by the way, have your listeners go to Kaptur, let's play bailout on YouTube. They'll be surprised.
DEFAZIO: Even better, have your listeners post the number for the Capitol switchboard, flood the Capitol switchboard tomorrow and call the Senate.
KAPTUR: That's a good idea.
DOBBS: Now that's a good idea. We're going to help you. We're going to have that and we're going to have -- we'll have that on our Web site, LouDobbs.com. We're going to put up that number. Now you want the number for the Capitol or you want the number for the House?
DEFAZIO: For the Capitol. It's the side on the Senate. We got to go for the Senate. We've got to stop the Senate tomorrow just like the House stopped it yesterday.
DOBBS: OK, we're going to have that number up. We're going to put that number up at the end of this -- on the other side of this break and ask everybody to do as Congressman DeFazio suggested. Call, e-mail and god speed. Thank you both very much. Congresswoman Kaptur, thank you Congressman DeFazio.
Up next, the presidential candidates, well they're out of control, they're out of touch. Now they're fighting to save the Wall Street bailout that the American people absolutely reject. Three of the most popular radio talk show hosts in the country will be here. And it took six years for the federal government to pass legislation that may, maybe not, could possibly protect our food supply. It's outrageous. That report on country of origin labeling, next. We'll be right back.
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DOBBS: Recent salmonella and e. Coli outbreaks have many of us again questioning the safety of the foods we eat. Today, federal country of origin labeling finally went into effect, six years after that law was first passed. But country of origin labeling not the solution, the entire solution to our food safety concerns. Louise Schiavone has our report.
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LOUISE SCHIAVONE, CNN CORRESPONDENT (voice-over): Country of origin labeling is finally the rule for broad categories of meats, fruits and vegetables. The U.S. Department of Agriculture says consumers will have more knowledge than ever about their foods, but consumer groups say it's taken six years to get here.
PATTY LOVERA, FOOD & WATER WATCH: The meat industry has spent millions of dollars over the years lobbying against this type of labeling.
SCHIAVONE: The American Meat Institute says the new rules will be expensive and cumbersome because it's difficult to segregate U.S. livestock from animals imported from Canada and Mexico. JIM PREVOR, PERISHABLEPUNDIT.COM: What they are doing is saying they're going to label all their beef, Canada, Mexico, and United States. If they take one cow from outside the United States and slaughter it that day, they can claim that that day was a mix production run and label it with all three countries.
SCHIAVONE: Even so, country of origin labeling will cover beef, pork, lamb and chicken, fresh and frozen fruits and vegetables, macadamia nuts, pecans and ginseng. But the biggest exception, anything defined as processed foods.
JAYDEE HANSON, INTL CENTER FOR TECHNOLOGY ASSESSMENT: The food processors have fought this since 2002. And they're still a little on the winning side.
SCHIAVONE: Among the exempted foods, roasted peanuts, packaged salad mixes with more than one ingredient, breaded chicken tenders and marinated meats, even bacon. In Europe, where country of origin labeling started in 1996, leaders are following U.S. developments.
AMB. JOHN BRUTON, EUROPEAN COMM. DELEGATION: It isn't just important what country the goods came from, it's important to know what the process was whereby the goods were produced and whether, for example, there was genetic modification involved or not.
SCHIAVONE: Country of origin labeling won't be cheap. The USDA estimates it will cost $2.5 billion in the first year alone.
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SCHIAVONE: The USDA told us that it drafted consumer-driven regulations according to the narrow specifications of the law passed by Congress. But some lawmakers, like Bart Stupak of the House Oversight Subcommittee say the USDA has dragged its feet on labeling and the rules still don't go far enough. Lou?
DOBBS: Louise, thanks - Louise Schiavone from Washington.
The presidential candidates still pushing for that Wall Street bailout, believe it or not. Three of the best radio talk show hosts in the country join me here next and also upcoming alternatives to the massive bailout. One of the country's leading experts on the international economy, David Smick, joins me with his global solution to this financial crisis.
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DOBBS: Joining me now, one of the most respected economic thinkers in the country, journalist David Smick says there should be a global solution to this financial crisis, as it is a global problem.
David is the author of the brand new very important book, "The World Is Curved: Hidden Dangers To the Global Economy." I recommend his book to you highly. Great to have you here.
DAVID SMICK, AUTHOR: Great to be here. DOBBS: This is -- we've just seen, in my opinion, the United States Congress stand up and tell this -- the Democratic leadership of Congress and this president and Henry Paulson to go stick it because they're not going to be railroaded on it. What do you think?
SMICK: I think we -- what bothers me right now is that we've had this magic pill mentality that if we only pass this pill or do this bailout, the magic pill will make this go away. I'm afraid to say this is going to be a credit crunch regardless of what Congress does. It's going to go into next year and we ought to prepare for it. We ought to prepare the average small business and the average person to protect them, or at least soften the blow. The banks have lost a trillion and a half dollars of capital. These banks are leveraged, 10 to 12 to one.
DOBBS: Some of them, 20 to 30 to one.
SMICK: But even the conservative banks. That means $15 to $20 trillion that was in the credit system before is gone.
DOBBS: It's gone and I'm not sure that this Congress or this president understands that whatever they did with this money, the $700 billion that they thought would be the panacea, the magic bullet, the magic pill, I can't understand where that thinking came from because most of these folks have lived through the 1987 collapse of the stock market.
They've had lived through the 1995 monetary crisis and currency crisis. What is happening? Where are the wise men in our financial marketplaces in this country? Because it's not Henry Paulson. It's certainly not the people at -- well, Merrill Lynch or Bear Stearns.
SMICK: Well, one of the problems I have is Washington is thinking domestically. And the solution is really going to be a global solution. There are $6 trillion in global money market funds sitting idle right now. There are trillions more in hedge funds, sovereign funds and all the rest. Now we may not like these capital flows but ultimately, they're going to be the short-term solution to refinancing the American system.
When you listen to Hank Paulson, what he says is, bail out now, reforms later. I don't understand why we're not offering reforms of the -- of our system right now. I mean, the reforms --
DOBBS: The reason -- let me hazard a guess. One is, he's taking care of his buddies on Wall Street. This is the free market, smile Mr. Market and all will be fine mentality of this administration for eight years. This is a legion of fools in that economic team and no reason to expect them to change simply because we have a major financial crisis in this country, is there?
SMICK: Well, you know, when you look at the events of the last two days or last week, the manipulation and really the foolish handling of market expectations. I mean, the American people ought to be angry for one additional reason. They're told the world is coming to an end. DOBBS: Let me put it -- these jackasses, whether they be Harry Reid, Nancy Pelosi, Barney Frank, Chris Dodd, President Bush, Henry Paulson, are talking down this economy, these markets, and they owe the American people an apology. And I mean, without equivocation, an absolute apology.
SMICK: If you're an elderly person last night and you say -- you called your broker and you said, the world's coming apart, so you sell everything, you sell every stock in your portfolio, in your small little retirement portfolio and you wake up this morning and the market rebounds by 485 and you say, what happened to my future? I mean, you know, it really is unconscionable.
DOBBS: And these leaders, if this market moves further it's going to be as much a crisis of competence in these so-called leaders. These people owe the American people an apology. David Smick, your book is wonderful. We recommend it highly to everyone. It's a great treatise on our globalized economy and the crisis, even the mortgage crisis only the beginning, as the sub, subtitle.
SMICK: Well, it's a book that explains it for the average person.
DOBBS: It is. And this is heavy going stuff and you did a brilliant job. Thank you very much, David Smick.
Up at the top of the hour "THE ELECTION CENTER" and Campbell Brown. Campbell, what are you talking about?
CAMPBELL BROWN, CNN ANCHOR: Hi, Lou. Well we're going to follow up on what you've been talking about, what exactly is going on on Wall Street. An optimism apparently in the markets today. Who do we have to thank for that? Is it the president? Is it the future president? Is it our lawmakers on Capitol Hill? We're going to get a read on what exactly is happening on Capitol Hill, how close they are to a deal. Better not hold your breath, at least not yet anyway.
Also, Lou, as you know, Governor Palin has been saying that you can see Russia from part of Alaska. Well we sent our Gary Tuchman there tonight. He's going to show us exactly what he can see. All that coming up in "THE ELECTION CENTER." Lou?
DOBBS: Thanks, Campbell. Up next, three of the best radio talk show hosts in the country. We'll be right back.
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DOBBS: Three of my favorite radio talk show hosts joining me now. In our D.C. bureau, Wilmer Leon of XM Radio, good to have you with us, Wilmer.
WILMER LEON, XM RADIO: Thanks, Lou.
DOBBS: Chris Plante, WMAL, Washington, D.C. And here in New York studios, John Gambling, WOR. John, great to see you.
JOHN GAMBLING, WOR: Good to see you again, Lou.
DOBBS: Let me start. What are your listeners saying about this defeat of the bailout?
GAMBLING: About 50/50. Half think it's the perfect thing to have happened and the other half say, hey, there's got to be a bailout. And as I listen to this and have talked about it for the last couple of weeks, like all of us here, I'm not sure I know any more today than I knew two weeks ago. But one thing I do hear, with the various options available and being suggested, that a bailout of some sort needs to be done. There seems to be some consensus there.
DOBBS: OK. How about you, Chris, your thoughts?
CHRIS PLANTE, WMAL: I'm hearing a great deal of anger mostly from people and contempt of Congress, which is probably appropriate in this circumstance. I think people feel like we're being lied to, like we're being misled, like the people responsible for it are the people who are promising the cure, like there are political agendas being everything. The Democrats are trying to socialize another segment of the economy and people are very, very angry.
DOBBS: Wilmer, your thoughts?
LEON: Well, my listeners basically see this as democracy in action, the fact that the congressional representatives actually listened to their constituents and voted against this.
DOBBS: Hallelujah.
LEON: Exactly. A lot of people are really not seeing this as a bailout, but seeing it as a scam. Henry Paulson wants $700 billion and no oversight? That's -- that violates one of the fundamental principles of our constitution, which is checks and balances. It makes no sense.
DOBBS: Well, you know, "Newsweek" had a cover of Henry Paulson calling him King Henry. And, indeed, they're right. Thank goodness they brought him back to earth. We also heard here tonight on this broadcast, Marcy Kaptur, congressman from Ohio, Congressman DeFazio.
GAMBLING: Very interesting.
DOBBS: No bailout -- the no bailout act in which they would follow a straightforward path that does not involve taxpayer money to solve it. I've got to tell you, it worked in Sweden, it worked in Finland, it worked in this country. Why aren't these fools in Washington, D.C. doing that?
GAMBLING: Because it's not big enough. You even mentioned that in your interview. It's not big enough but it makes a lot of sense. And I thought that the two Congress people made a lot of sense saying, hey, let's give it a shot, see what happens, we've got nothing to lose.
DOBBS: And it wouldn't cost a lot. It's got that much going for it.
Chris, let me ask you something, Governor Sarah Palin, everybody wants her to get out of the ticket because she keeps making these foibles. By our count, she's made far fewer than Joe Biden and far less serious gaffes and blunders.
PLANTE: I think this is just one of the most brutal beatings I've seen in my more than two decades in Washington. I think it's completely unfair. If you do stack them up against Joe Biden's gaffes and it's polite to call them gaffes - if Sarah Palin had said that FDR was president in 1929 and he went on television to address the nation, she would be fishing by a small lake by now.
DOBBS: That would be all over the "New York Times" front page.
LEON: That's ridiculous. I mean, so much of what Sarah Palin is saying is showing, as Fareed Zakaria said, she has no clue. It's not that she doesn't know the answer, it's that she doesn't really understand the question. She has foreign policy experience because she can see Russia from her backyard. I can see the moon from my backyard. That doesn't make me an astronaut. That's ridiculous.
PLANTE: If that's her biggest gaffe.
DOBBS: Wait a minute, stop. Wilmer has just come up with a great line and I think, I'm going to applaud that.
GAMBLING: It is a good line.
PLANTE: Thursday night will tell. Look, Thursday night is make or break for Sarah Palin. Everybody's going to make popcorn and going to be looking forward to this. I know that I am.
LEON: Oh, she'll do well.
PLANTE: And it is a big night for her. And she is to some extent or another unproven but she has also received the most extraordinary hatchet job that I have ever seen in Washington.
LEON: She'll do well, but --
GAMBLING: You know, her response, too, 60,000 people in Florida. I mean, nobody's done that in a long, long time.
DOBBS: By the way, there's one thing, too, this business about the not having a passport. You know, she may be on the right side of this. Only one out of four Americans have a passport. So that may work in her --
LEON: She's less well traveled than I am. That's terrible.
DOBBS: I'm sorry?
LEON: She's less well traveled than I am. That's terrible.
DOBBS: You know what, it's OK. It's OK to be just a plain ol' American, just a regular fellow.
GAMBLING: And I think Americans are saying that and showing that.
DOBBS: And you know what? I kind of embrace that myself because being an independent populist, you guys are going to have to explain your ideology and all your partisanship. John, great to have you.
GAMBLING: Great to have you. Having said that, the cringe factor with Sarah is pretty high.
DOBBS: Why did I let him do that? Chris Plante, Wilmer Leon, thank you, thank you. John Gambling, thanks for letting me finish. Tonight's poll, 65 percent of you say it's time for the liberal national media to take note that Senator Biden has made far more misstatements than Governor Palin. Thanks for being with us tonight. Good night from New York. "THE ELECTION CENTER" with Campbell Brown begins right now. Campbell?
