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Lou Dobbs Tonight
Obama Focuses on the Economy; McCain is Still Confident of Winning; Issues are Driving the Voters; Fight for Pennsylvania; What about Campaign Reform?; Border Drug Wars; Broken Borders
Aired October 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, CNN ANCHOR: Wolf, thank you.
Tonight a new shift among Independent voters as the presidential race is tightening. With just five days to go before the election new polls show a narrowing margin between these presidential candidates, we'll have complete coverage for you from the campaign trail.
And Senator Obama's record-breaking fundraising making this presidential campaign the most expensive in history. Is the lasting legacy of this campaign a dangerous new mix of money and politics?
And tonight you won't hear anything about illegal immigration on the campaign trail. But communities all across this country are battling with the issue every day. One of those communities, Hazleton, Pennsylvania, at the center of a lawsuit tonight that could have a far-reaching impact on this nation. 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 Thursday, October 30th. Live from New York, Lou Dobbs.
DOBBS: Good evening, everybody. The latest opinion poll show the presidential race is tightening with just five days remaining until the election. Senator Obama's lead has narrowed as Independent undecided voters are choosing their candidates.
The McCain campaign is seizing on these new poll numbers to make a case that it can win next Tuesday. Senator McCain and Governor Palin bringing their message to key battleground states, and they're not giving up, even in places where Senator Obama holds a double-digit lead in the polls.
We have extensive coverage tonight. And we begin with Jessica Yellin with the Obama campaign.
(BEGIN VIDEOTAPE)
JESSICA YELLIN, CNN CONGRESSIONAL CORRESPONDENT (voice-over): In Sarasota, Florida, a town hit exceptionally hard by the housing crisis, Barack Obama drove home a familiar message.
SEN. BARACK OBAMA (D-IL), PRESIDENTIAL CANDIDATE: If you want to know where John McCain will drive this economy, just look in the rear- view mirror. Because when it comes to our economic policies, John McCain has been right next to George Bush.
NARRATOR: No tax breaks --
YELLIN: If that doesn't sink in, the Obama campaign is hoping this will.
NARRATOR: Wonder where John McCain would take the economy? Look behind you. John McCain wants to continue George Bush's economic policies. Look behind you, we can't afford more of the same.
YELLIN: He's seizing on new data that shows the nation's economy is shrinking.
OBAMA: Our family GDP is a direct result of a failed economic theory of eight years of trickle-down, Wall Street first, Main Street last, policies that have driven our economy into a ditch.
YELLIN: And in the battleground state of Missouri, a similar message from Senator Joe Biden.
SEN. JOSEPH BIDEN, (D-DE) VICE PRESIDENTIAL CANDIDATE: Who will make us better off four years from now?
YELLIN: Biden has been sticking to the talking points, after telling donors last week, that if elected, Obama will immediately be tested by an international crisis. A gaffe so bad, John McCain used it in an ad.
BIDEN: Mark my words...
YELLIN: Now Biden is relentlessly on message, and today, joking about it.
BIDEN: I didn't see the band up there. Hey, folks, how you guys doing? Thanks for being here. That's really nice of you, thank you. That's good, that's what you call getting off message. But I tell you, you guys look good.
YELLIN: As the campaign tries to get through these last few days, and these battleground states, without committing any memorable fouls.
(END VIDEOTAPE)
YELLIN: And Lou, Barack Obama remains bullish in his scheduling, today all three of the counties he visited went for George Bush in 2004. From Virginia Beach, he is now headed to Missouri. But I will tell you the campaign remains focused on the state he was in this morning -- Florida.
They want to win there. And tomorrow they're unveiling a new weapon, they're sending Al Gore to campaign for him in Florida -- Lou?
DOBBS: The closer, Al Gore, all right, Jessica, thank you very much.
(CROSSTALK)
DOBBS: Jessica Yellin, appreciate it.
Senator McCain today campaigning in the symbolically-named town of Defiance, Ohio. McCain is now in his final bus tour of the battleground state. He insists he can win this election by winning Independent voters. McCain also enlisted the help of one of Ohio's most famous sons, "Joe the Plumber", but not everything went as planned. Ed Henry has our report.
(BEGIN VIDEOTAPE)
ED HENRY, CNN WHITE HOUSE CORRESPONDENT (voice-over): There's nothing subtle about the final few days for John McCain. Who began Thursday in the Ohio city of Defiance, as in, let's defy the nay- sayers.
SEN. JOHN MCCAIN (R-AZ), PRESIDENTIAL CANDIDATE: We're a few points down, but we're coming back.
HENRY: But in a sign of just how difficult it will be for McCain to pull that off, a dreaded unscripted moment. Excitement had been building, because McCain's staff had told the senator and the press that Ohio's now-famous "Joe the Plumber" was in the crowd. Except he was not.
MCCAIN: Joe's with us today. Joe, where are you? Where is Joe? Is Joe here with us today? Joe, I thought you were here today. All right, well, you're all "Joe the Plumbers".
HENRY: Embarrassing, after all the time McCain has spent building up Joe as a symbol of his appeal with middle-class voters. A McCain aide claimed Joe decided not to come and staff couldn't get word to the senator in time. But Joe told CNN that after the campaign initially invited him, nobody ever called back to confirm. And he was not happy about being introduced at the event, anyway.
JOE WURZELBACHER "JOE THE PLUMBER", MCCAIN SUPPORTER: Get involved in the government and that way we can hold our politicians accountable.
HENRY: The McCain camp scrambled to get Joe to a second rally. But the damage was done. And McCain stumbled, mid-attack as he lashed out at Barack Obama's 30-minute television ad.
MCCAIN: He's measuring the drapes and he gave his first address to the nation before the election. Never mind.
HENRY: He recovered however to pounce on a comment by Obama who said if he loses, he'll be glad to work with a President McCain.
MCCAIN: That sounds like a great idea to me. Let's help him make it happen.
(END VIDEOTAPE) HENRY: Now the McCain camp did manage to get "Joe the Plumber" here to a rally. It just wrapped up behind me here in Mentor, Ohio, and I can tell you some of the applause from this large crowd here in Ohio for "Joe the Plumber" was just as loud or louder than the applause for John McCain.
It reminded me of some of the joint rallies John McCain has with Sarah Palin, in fact. A lot of times the crowd is bigger and louder when Sarah Palin is there, Lou.
DOBBS: Well that was a pretty good recovery for Senator McCain, when looking out there for "Joe the Plumber" and then announcing everybody is "Joe the Plumber". You got to give him credit.
HENRY: Well I don't think he had any other option. He seemed -- he was looking around, he said, where is he? I thought he was going to be here. So that was about his only way out, Lou.
DOBBS: Well I'm not sure it's the way out that would have occurred to me. Good for him. Thank you very much, Ed Henry. Thanks.
Both candidates are fighting for the edge in those critical battleground states. And while the national polls show the margin narrowing, polls from some key battleground states across the country show something quite different. Bill Schneider with our report.
(BEGIN VIDEOTAPE)
WILLIAM SCHNEIDER, CNN SENIOR POLITICAL ANALYST (voice-over): Barack Obama's momentum is building in some key states. Obama's lead in Nevada has increased from four points last month, to seven. North Carolina was tied early this month. Now Obama's six points ahead.
Pennsylvania looked good for Obama last month when he was leading John McCain by nine. Now, he's leading by 12. Ohio remains close, however. Obama led by three points early this month. Now he leads by four. What about McCain's home state of Arizona?
Where's the love? Well, McCain is leading in Arizona by seven points. George W. Bush carried Arizona by 11 points four years ago. California is anything but a battleground state. But Obama has been gaining there, too, according to the Field poll. Obama has gone from a solid 16-point lead in September to a whopping 22-point lead now.
That would be the biggest winning margin for any presidential candidate in California since World War II. Bigger than Lyndon Johnson in 1964. Bigger than Ronald Reagan in his home state. According to California's Field poll, issue voters are going for Obama by almost three to one.
OBAMA: The central question is of this election is -- what will our next president do differently?
SCHNEIDER: Voters who base their decision on personal qualities are going for McCain. MCCAIN: Senator Obama is running to spread the wealth. I'm running to create more wealth.
(APPLAUSE)
MCCAIN: Senator Obama is running to punish the successful. I'm running to make everyone successful.
(APPLAUSE)
SCHNEIDER: Only 13 percent of Obama voters in California say they are mainly voting against McCain. Thirty-one percent of McCain voters say they are casting a vote against Obama.
(END VIDEOTAPE)
SCHNEIDER: Now those national polls, Lou, could be showing a little buyer's remorse among some undecided voters who keep hearing that Obama is way ahead and they aren't buying it. But the question is, are there enough undecided voters left five days before the election, to enable McCain to overtake Obama?
DOBBS: You know what we're not hearing a lot of discussion about is the percentage of undecideds out there and those who are, if you will, weakly committed to a candidate, if committed is the appropriate word. We have a sizeable number of undecideds remaining in this race, do we not?
SCHNEIDER: Well you have a sizeable number of people who say they've decided, but they could change their minds. The question is are they changing their minds? A few might be. We really press people in our polling very hard and we say -- well if you really had to decide right now, how would you vote? And that shrinks the number of undecideds down to just a few percent, but some of them still say they could change their minds.
DOBBS: And I think we should point out, too, that when pressed, as you said CNN does, that is not always the recommended procedure, if you will, leaving aside those undecideds you can have some unintended consequences I think generally discussed among pollsters. Do we worry about that at all?
SCHNEIDER: We do -- we are concerned about that. And obviously we don't want to force an opinion on someone who really doesn't have one. But what we find out is when a voter has any inclination in one direction or another, more often than not, which is not invariably, but more often than not, they vote for the person they're inclined to favor right now.
DOBBS: The odds are with us?
SCHNEIDER: Yes.
DOBBS: In determining the odds.
SCHNEIDER: Yes. DOBBS: All right. Thanks, Bill Schneider. Appreciate it.
Turning now to the issue of voter registration fraud, and the left-wing organization, ACORN, remarkably, in the midst of at least 13 investigations in states, those investigations led by state authorities, also now the federal government investigating as well, ACORN is using the reporting of this network, namely focusing on myself and one of our finest journalists, Drew Griffin to try to find some, some interesting, giving them money.
ACORN, which calls itself the voice of low and moderate-income families and has maintained for a very long time that it's nonpartisan, now it says it's under attack from "ethically-challenged reporters, as it writes, like Lou Dobbs and Drew Griffin from CNN. ACORN needs your help to fight back against these smears. And to help ensure that all of our voters can vote on Election Day."
We asked ACORN just how much money they had raised in the name of myself and Drew Griffin. We're still waiting for a response. By the way, ACORN is out with a new poll attacking John McCain. It's sort of an interesting approach, for an organization that claims to be nonpartisan.
Well, time now for tonight's poll. The question is -- do you believe the national media in general has abandoned its objectivity in the coverage of this presidential campaign? Yes or no. We'd like to hear from you on this. Cast your vote at loudobbs.com. We'll have the results here later.
Up next, investigating voter registration fraud in Michigan. The state's attorney general, Mike Cox (ph) joins me.
And it's the most expensive political campaign in history. Where did all of the money come from? We'll have a report on whatever happened to campaign finance reform.
And can Governor Palin turn the tide for the McCain campaign in a Democratically-controlled state of Pennsylvania? We'll have that story as well and a great deal more. Stay with us.
(COMMERCIAL BREAK)
DOBBS: In these final days before the election, the fight in the battleground states is intensifying. Governor Palin held a rally this afternoon in Erie, Pennsylvania, despite poll numbers that show Senator Obama leading by 11 points. Senator McCain's campaign still says it can win the crucial state. Brian Todd has our report from Erie, Pennsylvania.
(BEGIN VIDEOTAPE)
GOV. SARAH PALIN (R-AK), VICE PRESIDENTIAL CANDIDATE: So Pennsylvania, are you ready to help us carry your state to victory?
(APPLAUSE) BRIAN TODD, CNN CORRESPONDENT (voice-over): A full assault on Pennsylvania, from a campaign convinced it can turn the tide where the Democrats have dominated for 20 years. Sarah Palin takes the point, starting with the critical blue collar belt in Erie.
PALIN: Only John McCain has the wisdom and experience to get our economy back on the right track. Because he has a pro-private sector, pro-growth agenda to get government back on your side.
TODD: Palin's connect-ability with working-class voters, union members and socially-conservative Democrats is a key reason she's here. Why a McCain strategist says they can quote, "move the needle in western, southern and central Pennsylvania." Palin's appearance with Erie native and former governor and homeland security chief, Tom Ridge, designed to bolster the campaign's standing with Pennsylvania's veteran community.
PALIN: Let's not retreat from wars that are almost won. And let's not gut the defense budget in a time of multiple conflicts and obvious dangers.
TODD: Drawing contrast with Barack Obama on security and taxes. Part of a grandeur scheme to pick off a state where Obama took a pounding by Hillary Clinton in the primaries. McCain campaign officials tell us those Clinton blue collar conservative Democrats are winnable for them.
They believe the double-digit lead for Obama in many Pennsylvania polls is deceiving. And local political science professor, Robert Speel agrees.
ROBERT SPEEL, PENN STATE UNIVERSITY-ERIE: Pennsylvania traditionally also in recent elections, the Democrat such as John Kerry or Al Gore have had a large lead prior to election day. And then when on the actual election, they only won Pennsylvania by a small margin. So Democrats often seem to poll better in Pennsylvania than they actually do on election day.
(END VIDEOTAPE)
TODD: Now Robert Speel says he'll still be surprised if McCain and Palin pull out a victory here in Pennsylvania on Tuesday. But he says, if they do win or at least draw close in this traditionally Democratic state it likely will mean that they're also drawing closer in places like Virginia and Florida. Those battleground states that we're all going to be watching so closely on Tuesday. Lou?
DOBBS: Thank you very much, Brian -- Brian Todd from Erie, Pennsylvania.
Well this general election campaign, the most expensive in history, more than $5 billion spent in the campaigns for the House, Senate, presidential races. Senator Barack Obama has spent more money than any other candidate ever to run for president. More than $600 million. Obama broke fundraising records because he went back on his pledge to accept public financing. As Lisa Sylvester now reports, this election is raising new concerns about mounting influence of money in politics.
(BEGIN VIDEOTAPE)
LISA SYLVESTER, CNN CORRESPONDENT (voice-over): Senator Obama ran a 30-minute infomercial on seven of the major networking cable stations. The cost? Between three to $5 million. CNN declined to run the ads. Never before has a candidate so close to an election, bought that much primetime space on that many stations. It is a mark of just how much money the Obama campaign has.
BILL BUZENBERG, CENTER FOR PUBLIC INTEGRITY: He has a tremendous advantage in money, there's no question. He's raised $640 million for this election, which -- much greater than the 370 million or so that John McCain has. He has a great deal more.
SYLVESTER: Senator Obama originally agreed to accept public financing in the general election and spending limits. But later, he opted out. That allowed Senator Obama to raise far more cash than Senator McCain, who was limited to $84 million. Political analysts say Obama's fundraising success may well be the death of public campaign finance.
THOMAS MANN, BROOKINGS INSTITUTION: There will be an effort to change it, but it isn't clear whether reformers can come up with a package that (A), can be approved, signed into law. And that, (B), then is a sufficient enticement for, for candidates to participate in it.
SYLVESTER: Republican critics complain that Obama's money advantage has led to over-the-top ads and overkill exposure.
CHERI JACOBUS, REPUBLICAN STRATEGIST: The money discrepancy is really astonishing. Because the amount of money that Barack Obama is spending can be construed as essentially buying this election.
SYLVESTER: An Obama spokesperson dismisses this as angry desperate attacks by the Republican Party, saying quote, "the very same lobbyists and special interests that dominate Washington today have funded and advised Senator McCain's campaign. Barack Obama's campaign has been funded by more than 3.1 million hard working Americans giving small donations."
(END VIDEOTAPE)
SYLVESTER: Obama has raised roughly half of his money from small donors, many of them online. But that, too, is a source of criticism from Republicans. In an interview Senator McCain raised concern about donors giving money online with prepaid credit cards. He says that money cannot be easily traced and it's not clear where the money came from, or who contributed it-- Lou?
DOBBS: Lisa, thank you very much. Lisa Sylvester from Washington.
Up next, illegal immigration, an issue ignored on the presidential campaign trail. One community at the forefront of the fight to control the impact of illegal immigration, is Hazleton, Pennsylvania. And it has its day in court. We'll have that live report.
More disturbing evidence tonight that Mexican drug cartel violence is spreading into the United States. We'll have details of a confidential FBI report obtained by this broadcast. Stay with us. We're coming right back.
(COMMERCIAL BREAK)
DOBBS: More evidence tonight of the deadly violence from Mexico's drug cartels is spreading further into the United States. LOU DOBBS TONIGHT has obtained a confidential report warning of possible cartel attacks against U.S. law enforcement officers on American soil. Casey Wian has our report.
(BEGIN VIDEOTAPE)
CASEY WIAN, CNN CORRESPONDENT (voice-over): It's the latest sign that Mexican drug cartel violence, which has killed more than 5,000 people in less than two years, is spreading to the United States. A confidential FBI report obtained by LOU DOBBS TONIGHT warns that Mexican drug cartel operatives in Texas are under orders from their bosses in Mexico to engage U.S. law enforcement if they're confronted.
According to the report, paramilitary forces known as lozetta (ph) are replacing other cartel members, who have been arrested in the U.S. These replacements are believed to be armed with assault rifle, bulletproof vests and grenades, and are occupying safe houses throughout the McAllen, Texas area.
ROBERT GILBERT, BORDER PATROL SECTOR CHIEF: The border is controlled by organized crime. And that's exactly who we're combating, not just the border patrol, but all the law enforcement in the border communities' organized crime that's out there.
WIAN: Gilbert runs the border patrol's Tucson sector, which accounts for about half of the agency's seizures of drugs and illegal aliens nationally. This week he said his agents and local law enforcement have been working on a drug cartel violence response plan for 18 months.
GILBERT: To date, it has not spilled across the border. Will it or not? We don't know. We're not going to take the chance of not being prepared if it does.
WIAN: U.S. law enforcement says the increased threat of violence is the result of successful operations targeting cartels. One of those was announced Thursday in Atlanta, where agents displayed photos of $22 million in cash seized from drug smugglers.
DAVID NAHMIAS, U.S. ATTORNEY, GEORGIA: The agents and officers also seized more than eight tons of marijuana and hundreds of pounds of cocaine.
WIAN: Authorities say nearly $1 million was seized from the truck of a Texas sheriff's deputy.
(END VIDEOTAPE)
WIAN: Mexican President Felipe Calderon began his war against drug traffickers 23 months ago. Since then, thousands of cartel members have been killed or apprehended. But cartel violence and corruption continues to spread, increasingly to the U.S. side of the border -- Lou?
DOBBS: Casey thanks so much -- Casey Wian from Los Angeles.
Federal immigrations agents today arrested the former manager of an Iowa meat-packing plant that hired illegal aliens. Immigration agents raiding Agriprocessors, one of this country's largest kosher meat packers. That raid back in May.
Nearly 400 illegal aliens were arrested working at the plant. Some of those as young as 13 years. Agents also confiscating dozens of fraudulent, so-called green cards. Yesterday Iowa's Department of Labor fined Agriprocessors nearly $10 million for wage violations. Another manager at the plant pleaded guilty in federal court yesterday to identity theft charges. She admitted helping illegal aliens obtain false visa numbers, so that they could be hired.
Hazleton, Pennsylvania, is one town that knows firsthand the impact of illegal immigration and what's required to fight back. The city's Illegal Immigration Reform Act was struck down by a federal judge more than a year ago. The case is now before an appellate court. At issue? Hazleton's right to hold employers and landlords responsible for doing business with illegal aliens. Bill Tucker has our report.
(BEGIN VIDEOTAPE)
BILL TUCKER, CNN CORRESPONDENT (voice-over): Just 200 yards from the birthplace of Liberty, Independence Hall in Philadelphia, Pennsylvania, lawyers came and judges convened to hear arguments over a town's limits on governing itself. The courtroom was packed.
The city of Hazleton arguing that its ordinances punishing employers who knowingly hire illegal aliens and landlords who rent to illegal aliens are proper and necessary. Lawyers for the ACLU and other groups contend the local ordinances are unconstitutional.
The city appealed to a federal appeals panel after losing its case in the lower district court. But much has changed since those initial arguments. The 9th Circuit Court of Appeals has ruled in favor of the state of Arizona, which has similar statutes and a federal district court ruled that Valley Park, Missouri's local ordinances modeled after Hazleton's, are legal.
KRIS KOBACH, ATTORNEY FOR HAZLETON: We urge the 3rd Circuit to remain consistent with what the 9th Circuit did out in California and uphold the abilities of cities and states to take limited steps to encourage the enforcement of federal immigration laws.
TUCKER: The ACLU argued the original court order should be allowed to stand. Otherwise, they argued, there will be a patchwork of immigration laws.
WITOLD WALCZAK, ATTORNEY, ACLU: If the court allows laws like Hazleton to go forward, what you're going to have is immigrant- friendly and immigrant-hostile enclaves in this country.
TUCKER: He rejects the argument that all Hazleton is trying to do is draft laws that are in compliance with federal law. And he argues that the notion of determining a person's legal status is more complicated than just knowing if they're unlawfully present in the country. The mayor of Hazleton stands by his law, which has never been enforced.
MAYOR LOU BARLETTA, HAZLETON, PA: I'll fight this all the way to the Supreme Court. I believe what we're doing is right and that we have the right to do this.
TUCKER: He may get that chance.
(END VIDEOTAPE)
TUCKER: Now just when that day might be, Lou, we don't know. According to the lawyers, it could take anywhere from four months to a year before the court issues its ruling. Lou?
DOBBS: All right. Bill, thank you very much -- Bill Tucker.
Up next, both presidential candidates say they're looking out for our struggling middle class. But does either really have a plan? Three top economic thinkers join us here.
And it's down to the final days of this campaign. Is there anything we still don't know about these two candidates? Well Stanley Kurtz (ph) of the "National Review Online" joins us here next to talk about a number of remaining questions and the rising incidents, if you will, of ambiguity. We'll be right back.
(COMMERCIAL BREAK)
ANNOUNCER: This is LOU DOBBS TONIGHT. News, debate and opinion.
Here again, Mr. Independent, Lou Dobbs.
DOBBS: Welcome back.
My next guest says that in these final days of the election, voters need to take a much closer look at Senator Obama and determine whether they really know him. My next guest says Senator Obama may have a more radical agenda than voters truly realize.
Joining me now is Stanley Kurtz, contributing editor to the "National Review Online," senior fellow at the Ethics and Policy Center. Stanley Kurtz, joining us tonight from Washington, D.C. Stanley, good to have you with us.
STANLEY KURTZ, NATIONAL REVIEW ONLINE: Lou, thanks for having me.
DOBBS: You've been - you've been looking into the Obama record for some time. Why has there been, in your judgment, so little interest on the part of the national media in looking into many of the issues that you have?
KURTZ: Well, Lou, I guess I have to put that down to a bias in the media. I think there's some pretty fundamental issues. For example, we're just now finding out there's a lot of evidence to indicate that Barack Obama was almost certainly a member of a pretty far-left-leaning third party, called the New Party.
Now when a presidential candidate had a close relationship with a third party, that's so fundamental. You would think the media would have to report that. So I have to put the failure to report that down to bias.
DOBBS: And when was he a member of the New Party?
KURTZ: This would be in 1996 when he ran for his first elective office, the Illinois state Senate. He was endorsed by the New Party. And all our evidence indicates that he was also a member of the New Party.
At a minimum, he worked very closely with the leadership of that party, which had a very redistributionist point of view, synchronizes very closely with what Senator Obama was saying on the 2001 radio broadcast the other day.
DOBBS: Let's listen in to Senator Obama, if we may. This is a campaigning in North Carolina yesterday, firing back at the label that Senator McCain has tried to hang on him, which is of course, socialist.
(BEGIN VIDEO CLIP)
OBAMA: Mainly he's called me a socialist for wanting to roll back the Bush tax cuts for the wealthiest Americans, so we can finally give tax relief to the middle class.
I don't know what's next. By the end of the week, he'll be accusing me of being a secret communist because I shared my toys in kindergarten.
(END VIDEO CLIP)
DOBBS: Well, you have to admit, Stanley, that's a pretty good line and very effective deflection. Do you believe -- and Senator McCain was asked this question, as to whether or not he believed Senator Obama is a socialist. And Senator McCain said no. Redistributionist, yes, but not a socialist.
What do you think?
KURTZ: I'd say that's about right. I think the labeling issue is a bit of a distraction. The important point is did Barack Obama is focused on the redistribution of income in a way that's much more radical than Senator McCain?
Certainly or even, I think, than mainstream American economics and political -- economic policy for the last 20 or 30 years. I mean, this is what matters. Whatever you want to call it.
Arguably, he's a socialist in the sense that he was once affiliated with a party that you could say was socialist. But again, it comes down to hair-splitting arguments that are a distraction from the fundamental point, which is that he's got a pretty far left- leaning economic inclination, which wants to redistribute wealth.
DOBBS: And redistributing wealth, redistributing wealth -- that is effectively, socialism. Is it not? So I'm sort of lost on this on why people are having a little trouble understanding what he's really talking about.
KURTZ: Well, Lou, in some technical definitions of socialism, we're talking about public ownership of the means of production.
DOBBS: Right.
KURTZ: And you know, nothing that Senator Obama has said openly advocates general public ownership of the means of production. But if you look at this New Party that he was so close to, they have something that verges on that position as perhaps a long-term agenda.
And in the short-term, they're trying in a pragmatic way, to move the economy closer and closer to that in a careful, incremental fashion. And you could certainly argue that Senator Obama has this incremental, radicalism.
He wants it in little pieces, little chunks. But the long-term goal, you could say, might be something close to socialism. But again, we would get distracted by the label and miss the basic radicalism of the point of view.
DOBBS: Stanley Kurtz, great to have you with us, thank you for joining us here.
KURTZ: Thanks for having me.
DOBBS: Up next, Michigan is now investigating cases of voter registration fraud. State's attorney general, Mike Cox, joins me.
And more contaminated food from communist China may be on its way to this country. We'll have that report.
And there's signs of the economy, as we are told, that is contracting, is in fact improving. What's going on? And what will be the impact on the election? Three of the country's best economic minds join me here next. Stay with us, we're coming right back.
(COMMERCIAL BREAK)
DOBBS: Joining me now, three of the best economic minds in the country. In our Washington, D.C. bureau, Professor Peter Morici of the Robert H. Smith School of Business at the University of Maryland, David Smick, author of "The World is Curved: Hidden Dangers to the Global Economy," and former Treasury Department economist, Bruce Bartlett -- Bruce, a former U.S. deputy assistant secretary for economic policy at the treasury. And thank you all for being here.
Let's go to a couple of developments, and let's begin first with the most notable report. And that is, that our -- the Commerce Department reporting that the economy in the third quarter contracted, Bruce, by 0.3 percent. Were you at all surprised?
BRUCE BARTLETT, FORMER U.S. TREASURY DEPARTMENT ECONOMIST: Oh, not at all. And remember, this is a very preliminary report. It will be revised probably downward in coming months and I think we're almost certainly going to see a decline in the fourth quarter of -- between three percent and four percent, probably.
DOBBS: Three percent to four percent?
BARTLETT: Yes.
DOBBS: Peter Morici, do you concur?
PROF. PETER MORICI, UNIVERSITY OF MARYLAND: No, I think it's going to be more shallow, the decline, than that. My feeling, as we -- we know that we're going to be going through a rough patch. But I don't think that we're going to be looking at a terribly deep decline. It's going to be significant. But I don't think it's as significant as Bruce is indicating.
DOBBS: And David Smick, you recently wrote that -- let's go to this, your editorial published in the "Washington Post" Sunday. You compared the global financial markets to a, quote, "rich, generous, but occasionally paranoid great uncle."
You said, "Normally this benevolent great uncle sprinkles money calmly and wisely throughout the family, taking a careful reading of risk and potential investment reward. But every so often, a deep paranoia overtakes him." Do you see any sign that that paranoia is subsiding, the panic is weakening?
DAVID SMICK, AUTHOR, "THE WORLD IS CURVED": Well, I think the fact that, you know, that Bernanke has got 12 fire hoses shooting liquidity into the system, I think we've talked about this before, Takes depression off of the table. We're talking about recession.
I think the paranoia still exists about credit card debt and auto debt next year, about this crisis moving from the banks to personal -- the personal balance sheets of the average American. But I think the greatest paranoia is international. When you look at what's happening internationally, you know, Lou, the model has been for the last several decades, the U.S. is the consumer of last resort. And the world sets up export platforms to -- you know, send their exports to the U.S. and build up excess savings.
And now with the global economy collapsing, that model is just crumbling. And we're going to see emerging markets. Now they're weakening very, very quickly. And the surprise has been that the European financial exposure to emerging markets is six times the U.S. bank exposure to the subprime. So you know the paranoid great uncle is paranoid right now because of global reasons.
DOBBS: And globalization itself right now, so-called, you know, you just laid out the model. The model is that United States has been financing these other economies. And doing so while, frankly, jeopardizing -- not jeopardizing, I mean we have literally squandered this nation's wealth in so doing.
Peter Morici, let's listen to, if you will -- each of you, please -- what Henry Waxman, the chairman of the House Committee on Oversight and Government Reform had to say today about the institutions. Nine financial institutions receiving taxpayer money in the Wall Street bailout. Here's what he said.
"I question the appropriateness of depleting the capital that taxpayers just injected into the banks through the payment of billions of dollars in bonuses, especially after one of the worst financial -- one of the financial industry's worst years on record."
We have talked with Congressman Waxman's office. They haven't received a response from anybody. What -- we are in -- in addition to this, half of the money spent so far on these banks will go over the next three years to dividends to their shareholders, as things stand right now. That is unconscionable, is it not, Professor Morici?
MORICI: Absolutely. We haven't seen hubris on the part of aristocrats like those in New York since just before the French Revolution. It's absolutely absurd that Vikram Pandit, who himself was paid $155 million to sell a bogus hedge fund and put the money in his pocket to Citigroup shareholders, is now prepared to dole out millions and millions more in bonuses to his executives for the privilege of running that bank into the ground, and then borrowing tens of millions of dollars from the American taxpayers.
It's not just Pandit, it's Stan over at Merrill Lynch and all the others. This is what destroyed Lehman Brothers. They took half the profits of Lehman Brothers, put it into the pockets of the executives, and essentially declared the place bankrupt. It's obscene, it's beyond reproach.
SMICK: You know, Lou, I -- I talked to a number of Japanese officials and bankers in the last week or two. And I've said, you know, you -- went through this experience in the '90s of a financial crisis. What did you learn? And I was surprised that quite a few said, we made the mistakes of giving the banks the money and not requiring anything.
And in fact, I said, what would you have done? He said, we would have basically -- we would have -- not privatized it. We would have -- taken the banks over, had a workout team essentially...
DOBBS: Well, David, I mean, that's what's...
SMICK: ... temporarily nationalizing...
DOBBS: That's what's happening here.
SMICK: Right. And...
DOBBS: As a matter of fact, we heard from the treasury secretary, we've heard from the Democratic leadership of this Congress, that they were dealing with the issue of CEO compensation. They're going to constrain it.
SMICK: Yes.
DOBBS: There will be no golden parachutes. Now we find out that they're lying through their teeth.
SMICK: Yes.
DOBBS: And neither party, Democrat or Republican, they -- you know...
SMICK: We both know --
DOBBS: Both of them.
SMICK: I don't think -- what -- the banks are being foolish. Because, you know --
DOBBS: The banks are being foolish? Wait a minute. I'm sorry, before we get to the banks --
SMICK: Yes.
DOBBS: Can we talk about $200 billion in taxpayer money, floating into the pockets of shareholders, who should be bearing the brunt and the responsibility of the failures of these institutions and the executives who are taking down billions of dollars --
MORICI: Well, these executives --
DOBBS: -- when they drove these institutions into the ground?
MORICI: These executives have quite simply purchased the United States Senate. Folks like Dodd and Schumer from New York. They've collected enormous campaign contributions from these guys. So now they're willing to turn a blind eye.
All the bailout bill did was keep them from giving golden parachutes to the five top executives and limit tax deductions on their pay. But the vast majority of executives at these institutions --
(CROSSTALK)
DOBBS: Bruce Bartlett -- I'm sorry, Peter.
MORICI: -- millions of dollars in bonuses.
DOBBS: I got to turn. Bruce, you're going to get the last word here, we're running out of time. Your thoughts on what in the world happened to -- you know, I thought the Republicans were supposed to have some compunction about prudence, responsibility, moral hazard.
I thought the Democrats were going to actually be serious about constraining excess compensation to CEOs and executives. Both of these parties are frauds, are they not?
BARTLETT: Yes, absolutely. What we're doing to the entire financial sector is turning it into Fannie Mae. We're making -- we're going to have a kind of public-private kind of partnership deal, where the risks are all borne by the government and all the profits go to private executives, as was the case with Fannie Mae.
And I think that that is fraught with risk. I think we need to sell off the government's share of these enterprises as soon as we possibly can and privatize them and have a true free market. But I don't think it's going to happen any time soon.
SMICK: But, you know, Lou, the deal was -- when the Congress said, we'll give you the money, to the banks, if you lend. They're not lending.
MORICI: That's right. We have the bankers --
SMICK: That's the tragedy.
DOBBS: Gentlemen, we appreciate it. Thank you very much. I mean, I don't know who -- you know I suppose both of these parties, the House, the Senate, the White House -- they all think that they fooled someone.
The only people they did fool certainly were those who they bought off with $150 billion. And of course, they took care of their contributors, both of these parties, on Wall Street. Thank you very much. David, appreciate it, Bruce, thank you, Peter, thank you very much for being with us, gentlemen.
Up next, new concerns about dangerous food imports from communist China -- you guessed it.
And up next, the threat of voter fraud posing to this election. Michigan's state attorney general, Mike Cox, joins me. We'll be talking about his investigation into voter fraud, including cases tied to ACORN.
We're coming right back.
(COMMERCIAL BREAK)
DOBBS: As we've reported extensively on this broadcast, the left-wing activist group ACORN is now under investigation in at least 13 states for widespread voter registration fraud.
Michigan's attorney general, Mike Cox, is investigating several cases of registration fraud in his state, including cases tied to ACORN. Attorney General Mike Cox joins us tonight from Farmington Hills, Michigan.
Mr. Attorney General, good to have you with us.
MIKE COX, MICHIGAN ATTORNEY GENERAL: It's good to be here, Lou.
DOBBS: How serious and widespread are the cases you're now investigating of voter registration fraud?
COX: Well, Lou, that's what we're trying to get to the bottom of. We've charged three people over the past week, one with ACORN and two others just yesterday with a group called the Community Voters Project, which is a similar third-party group.
It's not connected with local clerks and they put pressure on their employees. There's a quota system and the employees go out, and they -- with gross neglect, gross negligence, go out and get these bogus registrations, you know, with Mickey mouse, Donald Duck, the whole nine yards.
And as you know and as I know you reported at times --
DOBBS: Right.
COX: Even the "New York Times" indicated last week that over 30 percent of the ACORN registrations are bogus, fraud or fake, and that should be disconcerting to anyone who cares about free and fair elections.
DOBBS: Free and fair elections, and federally supported organizations like ACORN.
COX: Right.
DOBBS: As much as 40 percent of their money coming from the federal government. I don't believe most taxpayers even understand that.
You've arrested and charged an ACORN worker in Michigan, charged with six felony counts for submitting forged voter registration forms. Tell us about that case, if you could.
COX: Sure, Lou. Basically this guy went around and he felt the pressure of a quota from his ACORN supervisor so he went around and filled out people from the neighborhood or some dead people.
The folks that we charged yesterday, again, dead relatives put on there, and it's a problem. It's against a backdrop here in Michigan. The Department of Justice tells us that in 38 counties we have more registered voters than there are people eligible to vote, and, Lou, as you know, this is the first step for potential widespread fraud, especially in the area of absentee voting where a person doesn't show up at the polls.
DOBBS: And it's happening -- it's happening across the country. I was talking with election officials -- an election official today in Mississippi. One twenty-three percent voter registrations, that's the margin against the number of people over the age of 18.
COX: Right.
DOBBS: You know, it gets -- it's insane. I just want to go back to Antonio Johnson who's been arrested in your state.
COX: Right.
DOBBS: ACORN had this response saying, quote, "Antonio Johnson was employed by us for a total of eight days. He was subsequently terminated. At the time of his arrest we immediately offered our full cooperation to both the Michigan attorney general's office as well as the United States Department of Justice." This from Scott Levenson, the ACORN spokesman.
Would you describe the kind of cooperation, the response that you are getting from ACORN?
COX: Well, apparently they're not talking to each other, Lou, because the local director here in Michigan said that even if we get Mickey Mouse on the registration form, we're not going to filter it out, we're not going to stop it.
Now, you, I and everyone out there watching knows that Mickey Mouse isn't going to be a registered voter in the state of Michigan, but they are still going to try and pass that, but, unfortunately, with more, you know, John Smith, any other number of names that might get by local clerks and cause legitimate fraud, and it's an absolute shame.
DOBBS: Mike Cox, attorney general, state of Michigan. Thanks for being here. Appreciate it.
COX: Thank you, Lou.
DOBBS: Over the top of the hour, Campbell Brown, "NO BIAS, NO BULL." Campbell, what are you working on?
CAMPBELL BROWN, CNN ANCHOR: Thanks, Lou. Well, in a few minutes, we are going to catch up with John McCain on a bus in Ohio and having a little bit of trouble getting Joe the Plumber on board. We'll explain.
Also Barack Obama feeling so confident he's barnstorming through typically Republican states. We're going to show you how he's not just trying to win, but he is still going negative trying to clobber McCain. There is still plenty of unknowns out there, Lou, as you certainly know. We are going to look at one of the biggest for our young people. Are they actually going to turn out to vote? They haven't in previous years.
And we've also got some pre-Halloween stage craft that you're not going to want to miss. All that coming up, Lou.
DOBBS: All right, Campbell. Thank you very much.
Up next, serious concerns about the safety of our food supply. What is the federal government going to do about it? We'll have the story for you next. Stay with us.
(COMMERCIAL BREAK)
DOBBS: Communist China's media now reporting that manufacturers there are adding the toxic chemical melamine to animal feed. Melamine tainted candy imported from China has already been found in the United States as pet food.
But now they're concerns that there is more food that we eat that is contaminated.
Our Louise Schiavone has our report.
(BEGIN VIDEOTAPE)
LOUISE SCHIAVONE, CNN CORRESPONDENT (voice-over): From chocolates to seafood to baking condiments and pet food, importers of Chinese goods and Chinese consumers themselves are finding no end of alarm about the contamination of Chinese made products with core plastics compound melamine.
UNIDENTIFIED MALE: After the latest development on contaminated food products from mainland China.
SCHIAVONE: Even the Chinese state-run Xinhua news agency is carrying reports about the scandal.
WILLIAM HAWKINS, U.S. BUSINESS AND INDUSTRY: Chinese media is not a free or independent media. It's state-run media so this is a sign that the central government has decided that this has gone too far. It's hurting Chinese interests. Giving China a black eye in the world, and they are going to go out to get some of these people.
SCHIAVONE: This report from China's "Southern Daily" newspaper is replete with a depiction of where melamine is added to egg white in the production of so-called protein powder and reads, quote, "adding me melamine to animal feed has long been an open secret," end quote.
JOHN TKACIK, HERITAGE FOUNDATION: In order to cut costs, the Chinese will cheat. They will add melamine to -- to milk powder. They will add melamine to wheat gluten.
SCHIAVONE: Melamine tainted cooking ingredients from milk products to baking soda raised questions about the safety of imported crackers and chocolates, several already flagged by the Food and Drug Administration and a common children's favorite, pirates gold coin- shaped chocolates distributed only in Canada was recalled for melamine.
U.S. importer Sherwood Brands tells us that all candy they now import from China is tested before sold.
(END VIDEOTAPE)
SCHIAVONE: Lou, the FDA says about 210,000 foreign food companies are registered in the U.S. but insiders say only a fraction of those goods are inspected -- Lou?
DOBBS: Thank you very much, Louise Schiavone.
Well, our poll results: Eighty-six percent of you say the national media, in general, has abandoned its objectivity in the coverage of this presidential campaign.
We thank you for being with us tonight. Please join us tomorrow. For all of us here, thank you for watching. Good night from New York.
CAMPBELL BROWN "NO BIAS, NO BULL" starts right now -- Campbell?
BROWN: Thanks, Lou.
