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Lou Dobbs Tonight

Obama Blasts Wall Street; This is Change?; Blagojevich Thrown out; Border Drug Violence

Aired January 29, 2009 - 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, tonight, Governor Blagojevich expected to speak at any moment. We'll be bringing his comments to you. That, after the Illinois Senate voted to throw him out of office. We'll have that for you live.

Also here tonight, President Obama blasting what he calls shameful bonuses on Wall Street. What can the president do about it? What will he do about it? We'll have complete coverage.

And tonight the almost $1 trillion so-called stimulus package goes to the Senate. But only a small part of that money is actually to fix our crumbling highways, bridges and railroads. Our special coverage "Lou's Line-Item Veto" continues tonight.

Also a member of Congress telling homeowners they should fight back against foreclosure urging them to squat in their homes. That congresswoman is Marcy Kaptur. She's among our guests here tonight. We'll have that, all the day's news and a lot more straight ahead right here.

ANNOUNCER: This is LOU DOBBS TONIGHT: news, debate, and opinion for Thursday, January 29th. Live from New York, Lou Dobbs.

DOBBS: Good evening, everybody. President Obama today launched a scathing attack against Wall Street for handing out a staggering almost $20 billion in bonuses last year. President Obama said it's utterly shameful for Wall Street to have handed out such huge bonuses when the economy is in such dire straits.

(BEGIN VIDEO CLIP)

BARACK OBAMA (D-IL), PRESIDENT OF THE UNITED STATES: They have to start acting in a more responsible fashion if we are to, together, get this economy rolling again.

(END VIDEO CLIP)

DOBBS: President Obama telling bankers now is not the time for them to receive and hand out such huge bonuses. The president standing up -- Ed Henry has the report from the White House. Ed?

ED HENRY, CNN WHITE HOUSE CORRESPONDENT: Well, Lou, this president is trying to connect with the American people who are feeling so much economic pain right now. There's no easier way to do that, frankly, than to rip into some of the Wall Street bosses who are a big fat target right now. So the president pounced on this report from the New York State comptroller saying that last year there was more than $18 billion in bonuses given out to various Wall Street employees, even as many of their companies were crumbling, and they were coming to Washington seeking government handouts, laying off some of their employees as well.

You remember that earlier this week the Obama administration pressured Citigroup to refuse delivery on that $50 million corporate jet that had caused so much controversy. Now the president himself -- that was done by Treasury officials -- now the president himself weighing in on this bonus issue himself.

(BEGIN VIDEO CLIP)

OBAMA: That is the height of irresponsibility. It is shameful. And part of what we're going to need is for the folks on Wall Street who are asking for help to show some restraint and show some discipline and show some sense of responsibility. The American people understand that we've got a big hole that we've got to dig ourselves out of, but they don't like the idea that people are digging a bigger hole even as they're being asked to fill it up.

(END VIDEO CLIP)

HENRY: Now, we're getting new information from senior officials here who say that the president next week plans to back that talk up with some action, that he's planning to unveil a major financial reform package, beyond just the stimulus bill that's currently floating through Congress, but something that would deal with fixing the financial system, and that there would be a specific provision cracking down on Wall Street bonuses. Lou?

DOBBS: Well, that's the issue. It is the president's comments obviously welcome to anyone who has been critical of the excesses and the greed of Wall Street, the sheer irresponsibility, his capacity, however, to back that up and to effect change. For example, in this stimulus bill right now, in the TARP legislation, and in the -- and actually, the $350 million that remains to be spent, all of this money has been sprinkled around with what I have referred to here, all around Hank Paulson's little buddies on Wall Street, without any regard to the taxpayer, to those facing tough times across this country, and no effort whatsoever to curtail excessive CEO compensation on Wall Street, for that matter, across the board. These CEOs behave as if they own these firms rather than the shareholders. How will the president proceed?

HENRY: An important to make, Lou, you're absolutely right because back in September when leaders in both parties passed that TARP legislation, the bailout legislation, they basically promised that that legislation would have tough provisions to crack down on excessive CEO pay. Critics since then have noted, though, that there was a giant loop hole in there, and that basically there's not a strong enforcement mechanism to actually make that legislation work.

(CROSSTALK)

HENRY: And has all kinds of other issues as well, but you'll remember President Obama was a senator at that time and he voted for that legislation. It really didn't have strong provisions.

DOBBS: Let me assure you, I remember, and I also remember it was the responsibility of both the House and the Senate to have assured that those -- that excessive compensation was indeed policed in the legislation. In point of fact, without question, a loop hole was purposefully and consciously inserted into the legislation.

HENRY: I never thought that you forgot, Lou.

DOBBS: I didn't forget for a moment. Thank you very much, Ed Henry. As Ed just reported, Wall Street firms handing out more than $18 billion of bonuses last year as those very same financial institutions were on the verge of collapse, and begging for tens of billions of dollars in your taxpayer money.

That is the sixth largest bonus payout in Wall Street history, by the way. The average bonus for Wall Street employees last year was $112,000 the New York State controller said and this despite the fact that Wall Street firms lost more than $35 billion last year, more than three times the record losses of 2007. You can see why they deserved a bonus.

House Speaker Nancy Pelosi today rejecting charges she's responsible for any part of the bitter partisan divisions on the almost $1 trillion so-called stimulus package. Not a single Republican in the House voted in favor of the bill even though President Obama called for bipartisan support. Dana Bash has the story for us from Capitol Hill.

(BEGIN VIDEOTAPE)

DANA BASH, CNN CONGRESSIONAL CORRESPONDENT (voice-over): House Speaker Nancy Pelosi insists passing an 800-plus billion dollar stimulus bill in eight days was pure victory.

REP. NANCY PELOSI (D-CA), HOUSE SPEAKER: I take credit for the great action taken by the Congress.

BASH: Yet to some the fact that it was so partisan, no Republican votes, suggests Democratic leaders made some tactical errors by adding pet projects that won't stimulate the economy.

REP. JIM COOPER (D), TENNESSEE: Here we are in the first week of the most exciting new presidency in a half century and the old bulls are back trying to conduct business as usual.

BASH: That's a fellow Democrat who voted no. But Pelosi bristles at any suggestion that her leadership caused the partisan divide.

PELOSI: I didn't come here to be partisan. I didn't come here to be bipartisan. I came here to my colleagues to be nonpartisan, to work for the American people. To do what is in their interest.

BASH: Now, an even bigger $900 billion stimulus bill moves to the Senate, and Democratic groups are pressuring several GOP senators with ads, hoping to make this vote bipartisan.

UNIDENTIFIED MALE: Tell Congress to support the Obama plan for jobs. Not the failed policies of the past.

BASH: Yet already a dozen GOP senators lined up to voice the same criticisms of their House brethren. Not enough tax cuts and too much spending on programs that won't stimulate the economy.

SEN. JON KYL (R), ARIZONA: Republicans have appreciated the president's outreach to present ideas, but we are too often met with this response -- we won. And therefore, we're going to do it our way.

(END VIDEOTAPE)

BASH: Now, in the Senate, Republicans will have a bit more of a chance to do it their way. They'll have more opportunity to offer amendments to change the Democrats' stimulus bill. But Lou, again, it's not just Republicans complaining. We talked to a few Democratic senators who say that they just see too many programs that they don't think actually stimulate the economy. For example, one senator pointed out $75 million in programs to stop smoking. Lou?

DOBBS: All right. Thank you very much. Dana, if you will stay with us. We're going to bring in two of our colleagues, of course senior White House correspondent, Ed Henry, senior political correspondent Candy Crowley. Thank you, both.

Candy, day 10 of the Obama administration. What happened to all that post-partisan, bipartisan spirit we were hearing all about?

CANDY CROWLEY, CNN SR. POLITICAL CORRESPONDENT: Well it certainly depends on which side you talk to as to who is being partisan and who isn't obviously the Republicans think. Listen, we had Democrats on our side in the House voting against this bill, so it was a bipartisan no. But the fact of the matter is that I think Obama's courtship at this point has to look -- be looked at in a broader scale.

Perhaps he's picking up some points for tougher votes, when he does see more Democrats moving away from him. And also I think in the end, despite his desire to have bipartisan support, for this bill, President Obama still comes out looking pretty good. Because what he can say is, I tried. I went up there. I invited them for coffee. I talked to them.

DOBBS: By the way, indeed, he did. As to whether or not a charm offensive should be sufficient to gain a vote on something as important as $1 trillion is another issue. And it's, again, a very peculiar thing. Ed, the president's declaring victory after that House vote. Is the White House expecting the same result in the Senate?

HENRY: Well, they are certainly hoping for a better result. And what they hope is that there's some tinkering with the tax cuts, there's some tinkering with the spending that you and others have been talking about so much. And that maybe they'll... DOBBS: Let me interrupt just real quickly. Let me interrupt real quickly. Governor Blagojevich stepping outside his home to address the cameras -- just want to explain he's going to speak now. Let's listen in.

ROD BLAGOJEVICH, FORMER ILLINOIS GOVERNOR: Let me begin by saying that I'm obviously saddened and disappointed but not at all surprised by what the state Senate did today. It was something that I knew they would do. A long time ago, pursuant to a variety of different dynamics that were taking place since the world changed for us on December the 9th. At some point I'd be happy to share some of those insights and thoughts with you.

But I'm really here today just to say how grateful Patty and I and our daughters Amy and Annie are for the opportunity to be able to serve the people of Illinois as their governor, for the past six years. How blessed I personally feel to have had a chance to get up every day and try to fight for ordinary people, average people, people who otherwise don't have a voice.

And how grateful I am that it wasn't just getting up and fighting for them, but that we over the last six years have been able to achieve a lot of things for real ordinary people and do it in a way, as I said earlier today, without burdening them, without burdening the middle class, without raising taxes. Expending health care for all our kids, getting all of our senior citizens free public transportation, getting all of our uninsured women access to mammograms and pap smears and God forbid cancer is found, the treatment necessary to cure them and make them healthy.

Giving all of our 3 and 4-year-olds and every parent of a 3 and 4-year-old the same opportunities to send their kids to preschool, like Patty and I have had an opportunity to do for our kids, put a record amount of money in education without raising taxes on people, raise the minimum wage two times for low-wage workers, when President Bush wouldn't raise it even once, just real things for real people who otherwise don't generally have a voice and are generally not the priorities of government. I'm obviously sad by what's happened, but again, as I said, not at all surprised.

And I want to say to all of you, the people of Illinois, who I've been blessed to represent as governor for the last six years, and before that, as a congressman for six years, and before that as a state legislator, and before that as a prosecutor that I love the people of Illinois today, now, more than I ever did before.

UNIDENTIFIED FEMALE: (INAUDIBLE)

BLAGOJEVICH: Thank you. And the fight goes on. Just because I'm not governor anymore doesn't mean I'm not going to keep fighting for you and for the causes that I've fought for my whole life, for ordinary people like my parents who worked hard and struggled to build a better life for their children, who knew what the struggles were, who had fierce and challenges, but also had hopes and aspirations and big dreams for their kids. Those simple values that they teach us in Sunday School, the Golden Rule, that you should do unto others as you would have others do unto you, those are the things I'm going to keep fighting for now that I'm in private life.

And I also want to say that I'm going to keep fighting to clear my name. I'm disappointed in the state Senate actions, because they deprived me of an opportunity to bring witnesses and prove my innocence. I wanted to do that sooner rather than later. I guess I'll just have to wait until I have my day in court. But again, to the people of Illinois, God bless all of you.

Thank you for giving me a chance to represent you. I want you to know I haven't let you down. I've gotten up every day thinking about you, fighting for you, pushing and prodding for you, being frustrated on your behalf, frustrated in a phony kind of politics that burdens you with everything, frustrated with a phony kind of politics where politicians talk a big game, but are not interested in getting anything done for you.

We've done real things for you, real tangible, meaningful things that have improved your lives. And I want you to know again how much I appreciate you, and how much I love you, and I just want you to know, give me a chance so I can show you I haven't let you down, that I've been about trying to do what is right for you. Thank you. And God bless you.

(CROSSTALK)

DOBBS: Former governor -- former Governor Rod Blagojevich making those comments rather emotional at several points, basically defending himself, the former governor. By the way, losing that impeachment vote today 59-0 in the Illinois State Senate. Lieutenant Governor, Patrick Quinn, is now the governor of the state of Illinois. I want to turn, Candy Crowley, your thoughts on seeing this step that we knew, this phase of what has been both the prosecution and some would argue the persecution of Rod Blagojevich?

This man has been vilified. He's -- evidence that is going to be coming forth in his trial, has already been released by the U.S. attorney. But there doesn't seem to be a single person in the state of Illinois supporting the former governor at any juncture along this path.

CROWLEY: No. Frankly, the people that you are hearing that sigh of relief from really are Illinois politicians who think that Governor Blagojevich -- former Governor Blagojevich was an embarrassment. They believe that he did exactly the things that he is suspected of, tried to sell the U.S. Senate seat once held by Barack Obama.

They feel his round of TV interviews was embarrassing. That if he really wanted to defend himself, he could have come to the Illinois Legislature and made a lawyerly response to it. Instead, we saw pretty much what we saw here, which was very much what he has been saying all along. I think it's an attempt to rewrite the legacy which I think still opens with the paragraph of the impeached governor.

DOBBS: Dana Bash, Ed Henry, I want to very quickly -- we just got a few seconds here. I want to -- this legislation, the stimulus package now moving, of course, to the Senate. Is there -- do either of you detect any sense amongst Republicans, that they're going to have to do more than be reflexive with calls for tax cuts, and the Democrats and the Obama administration is going to have to do more than be reflexive just calling for more pork barrel spending, that there's going to have to be careful consideration of a host of important issues, which as presidential candidate, President Obama was able to avoid, along with Senator John McCain, issues like what we're going to have to do to adjust our trade policies, what we're going to have to do to support manufacturing in this country, what we're going to have to do to support our middle class working men and women against the cheapest labor competition in the world. Because without all of those issues, it seems clear to me, and to others, that no amount of stimulus can succeed. Dana?

BASH: I think you're going to be disappointed to hear this, but my sense is that in the short term, meaning next week when this is going to be debated in the Senate, you're not likely to hear those global discussions, important discussions about those issues. I think it's going to be primarily about what's before them, the near $1 trillion of taxpayer money that they're going to be spending, and whether or not they can be for or against it.

However, in terms of the negotiations just over that, my sense is that they want to get this through the Senate, and then once they come together with the House, the White House is going to get involved. And as Ed and Candy have been talking about...

DOBBS: Any doubt that it will succeed in the Senate?

BASH: No, I don't think there's any doubt that (INAUDIBLE) in the Senate...

DOBBS: Ed Henry.

HENRY: I think she's right about that obviously Dana that the stimulus is very likely to pass in the Senate. I think broadly speaking to your question about the future, though, Lou, we're told by White House officials that in the meeting that Barack Obama had with Senate Republicans this week, not House Republicans, that one was focused all on the stimulus. But Senate Republicans kept pushing him on beyond the stimulus.

We want to know what are you going to do on housing and foreclosures, is there going to be a second TARP. And they were pressing him and he was trying to answer them. Because they do realize there's a much broader picture here. And just throwing money at the problem is not necessarily going to solve it, Lou.

DOBBS: Or cutting taxes alone. I appreciate it very much. Candy Crowley, Dana Bash, Ed Henry, as always, thanks.

In our poll tonight our question is we'd like to know what you think about the excess of Wall Street compensation. Here's the question. Do you believe the Obama administration will have the principle and guts to do more than talk about excessive Wall Street compensation? Yes or no. Cast your vote at loudobbs.com. We'll have the results for you later. And I don't want anybody to misunderstand me. I fully support, commend and compliment President Obama for having the guts to do something no one has done from the White House in a very long time. And that's talk about principle, morality and values that apply even to CEOs and to the nation's financiers.

Well in "Lou's Line-Item Veto" tonight, we'll continue going through the huge spending and borrowing legislation line by line. It's something very few of our elected representatives have done. Tonight we'll tell you how little of the so-called stimulus money will be spent on infrastructure, on rebuilding highways, bridges, water systems and railroads.

Coming up next, much more on governor -- former Governor Blagojevich's removal from office, three top political analysts join us. Also the Archbishop of Los Angeles, Cardinal Roger Mahony under federal investigation, we'll tell you all about that.

And lawmakers in Texas trying to protect American citizens from violent Mexican drug cartels; the federal government is doing nothing. A special report here next.

(COMMERCIAL BREAK)

DOBBS: New controversy tonight over the already controversial Archbishop of Los Angeles, Cardinal Roger Mahony, reports saying Cardinal Mahony is now under investigation by a grand jury to determine whether he failed to protect children from sexual abuse by priests. Cardinal Mahony himself says he has quote, "no idea what's going on." Mahony said "we were mystified and puzzled by the whole thing."

Cardinal Mahony of course is no stranger to controversy. His diocese reached nearly $700 million settlement with more than 500 victims of sexual abuse two years ago. Cardinal Mahony has also said point blank that his followers should disregard U.S. immigration laws as a matter of Catholic conscience.

Turning now to the deadly drug cartel violence raging along our southern border, Texas lawmakers tonight are stepping up trying to do what the federal government has failed to do, to provide resources necessary to fight the growing drug -- drug cartel violence from Mexico. Casey Wian has our report.

(BEGIN VIDEOTAPE)

CASEY WIAN, CNN CORRESPONDENT (voice-over): Across the Rio Grande from El Paso, Texas lies Sudad Juarez (ph), ground zero for the deadly drug war spreading throughout Mexico and across the border to the United States. Last year there were 1,600 drug cartel related murders in Juarez. And now there are growing signs that the violence is spreading into Texas.

UNIDENTIFIED MALE: It's already spilling into our communities across the state in the form of increasingly brazen transnational gangs. We have seriously hindered the drug cartel's ability to move contraband across our border. They're relying more and more upon those unprincipled gangs to do their dirty work.

WIAN: Perry says Texas has spent nearly $150 million in the past three years on border security efforts, adding that Washington has failed to provide the needed resources. Texas U.S. Senator Kay Bailey Hutchison who is considering running for governor against Perry next year agrees. She's proposing $100 million a year in federal funding for border law enforcement agencies struggling with crossover drug cartel violence.

SEN. KAY BAILEY HUTCHISON (R), TEXAS: We know that the border local law enforcement agencies do not have the capacity to match these drug cartels. They have the state of the art equipment, and they have guns, they have Ak-47s. And we want our local law enforcement to have the support to be able to combat these drug cartels.

WIAN: Cameron County, Texas Sheriff Omar Lucio says "our local police are outnumbered, outgunned and do not have the financial resources to match the cartel's unlimited financial budget." El Paso, Texas, remains one of the safest cities in America. But right across the border from El Paso in Juarez, more than 40 police officers were killed last year. Another was decapitated earlier this month.

(END VIDEOTAPE)

WIAN: For now, the Department of Homeland Security says it has a contingency plan in place to deploy the military to the border if Mexican drug cartel violence overwhelms local law enforcement in border communities -- Lou.

DOBBS: I couldn't help but note that Governor Perry saying that there had been some sort of stopping of the shipment and the transit of huge quantities of marijuana, methamphetamines, heroin and cocaine across the border from Mexico? Mexico remains the principle source of all of those drugs into the United States. What in the world is he talking about?

WIAN: Well, there have been improvements, according to people like Governor Perry and the Department of Homeland Security. But the intelligence reports that I'm seeing are saying that there are still huge quantities of drugs just waiting for the opportunity to come across that border. It's a little more difficult for the drug cartels now, but the drugs are still coming across in huge numbers, Lou.

DOBBS: There is -- there is no question for anyone who is concerned about the children, the young people, those addicts in this country, of methamphetamines, marijuana, cocaine, and heroin that we have to secure that border to stop what we are witnessing. And it is shameful what the Bush administration has done.

This is a shame that cannot continue one hopes under the Bush administration. More than 6,000 Mexican citizens killed over the past year. It is a tragedy, and the Department of Defense Casey Wian, we should point out releasing its report saying that they are concerned about two nation states that face the prospect of sudden collapse under the correct conditions, those two nation states being of course Pakistan and Mexico. Casey, thank you very much. Reporting from El Paso, Texas.

At least 17 people were killed, millions of others across the country left without electricity after that powerful winter storm. The storm covered several states with sleet, snow and ice. About seven inches of snow fell in the Buffalo, New York area, some parts of the northeast hit with as much as 10 inches of snow. Ice, snow knocking out power lines making some roads nearly impassable. And the state of Arkansas, for example, tonight thousands of residents there in Arkansas are without power. We're told it could be days before electricity is fully restored.

Up next here, outrage over the stimulus package's failure to provide enough money to rebuild our infrastructure. Our special coverage "Lou's Line-Item Veto" continues tonight.

Also a standoff between President Obama and some of his top military commanders over the issue of troop withdrawals from Iraq, I'll be joined by our military analyst, General David Grange.

And some homeowners are fighting back against foreclosure by exercising, if you will, squatter's rights in their homes. We'll tell you all about that and we'll be talking with a congresswoman who recommends the practice.

(COMMERCIAL BREAK)

DOBBS: Seething anger tonight at the federal government's utter failure to help homeowners in danger of losing their homes, even as the government is spending literally trillions of dollars to help out banks, investment companies. There were more than three million foreclosure filings last year, a million people foreclosed upon. Now, one lawmaker, Congresswoman Marcy Kaptur says it's time for homeowners to fight back, exercising squatter's rights.

Drew Griffin, of our Special Investigations Unit, with the report.

(BEGIN VIDEOTAPE)

DREW GRIFFIN, CNN SPECIAL INVESTIGATION UNIT CORRESPONDENT (voice over): The notices came to her home in April. Andrea Guice's bank foreclosed on her, behind in payments, out of work, a husband sick, she had nowhere to go.

So she decided to follow the advice of her Congresswoman, and go nowhere. Guice is part of a new movement in the Housing crisis, squatters.

(on camera) For lack of a better term, you're kind of squatting in this house, aren't you?

ANDREA GUICE, FORECLOSED HOMEOWNER: Basically, yes. Yes.

GRIFFIN: Last resort?

GUICE: Last resort, yes. GRIFFIN (voice over): More than 4,000 properties were foreclosed on in Toledo's Lucas County last year. This year, it could be worse. There's a county clerk whose full-time job is typing up and sending out foreclosure notices.

UNIDENTIFIED MALE: Tomorrow morning this will be mailed out.

GRIFFIN: Elected officials are saying Toledo is not in a recession, it is a depression. It is this bleak backdrop that inspired Toledo Congresswoman Marcy Kaptur to take the floor of the House earlier this month to tell her constituents to stay put.

REP. MARCY KAPTUR, (D) OHIO: So I say to the American people, you be squatters in your own homes; don't you leave.

GRIFFIN: Kaptur says she has had it with government bailouts for Wall Street banks, but nothing for homeowners. She is advocating for a legal revolution, a demand that not one of her constituents leaves their home without an attorney and a fight.

(on camera) Even if they've been foreclosed on, don't leave?

KAPTUR: If they've had no legal representation of a high quality, I tell them stay in their homes.

GRIFFIN (voice over): Kaptur is behind a strategy called produced the note. Mortgages have been so divvied up on Wall Street that banks are having a hard time finding that original paperwork, adding a delay to foreclosures.

She is also pushing banks to rework loans, especially those banks getting bailouts and holding mortgages of folks getting tossed out.

KAPTUR: They are vultures. They prey on our property assets. And I guess the reason I'm so adamant on this is because I know property law and its power to protect the individual home owner. And I believe that 99.9 percent of our people have not had good legal representation in this.

GRIFFIN: Without a lawyer, Andrea Guice bought a $147,000 home with nearly $40,000 down.

GUICE: I should have had an attorney. I really should have had the attorney. I did not know.

GRIFFIN: She admits she didn't read the paperwork, didn't learn, until it was too late, she had a sub-prime loan. Her payments of $883 a month jumped in a year to more than $1,500. When it did, she stopped paying.

(on camera) So they foreclosed on you?

GUICE: They have foreclosed on me, yes.

GRIFFIN (voice over): The law firm representing the bank in Guice's foreclosure declined comment to CNN. Another one of the banks Guice believes holds her notes, Wells Fargo, said it wouldn't comment on individual cases, but tries to work with homeowners.

Backed by her Congresswoman, Guice simply is not budging.

(END VIDEOTAPE)

GRIFFIN: Lou, no one's saying, "don't pay your mortgage." What the Congresswoman is saying if you're being foreclosed on, don't just leave. Don't assume you have to leave your house. And you're going to have a run, I know.

And I think what she'll you is, look, we bailed out the banks, but part of that bailout was to help the homeowners, the counselors, the lawyers. Well, in Toledo, Ohio, where are they? Lou.

DOBBS: Indeed, a question across the country that is being asked. Drew, to get it straight, Miss Guice paid how much for that house?

GRIFFIN: I couldn't believe it either, Lou. It was $147,000 house. I saw the paperwork. She put down nearly $40,000.

DOBBS: Just about 30 percent.

GRIFFIN: There's no reason she needed to be in this sub-prime. She admits she got hood winked.

DOBBS: And Wells Fargo is the mortgage holder?

GRIFFIN: Is the end-run mortgage holder, right. Not the person that wrote up the loan, as you know.

DOBBS: Right.

GRIFFIN: This loan was written up by a broker and sold probably ten times.

DOBBS: Well, we should -- you know, the fact is that the mortgage brokers, the people who are involved in this, should be being prosecuted in point of fact. Let me be very -- just arch about this, if I may -- they deserve to be prosecuted, because this is unfair.

I would hope Wells Fargo would have the decency, the honesty, the integrity and the national -- a sense of national obligation to straighten this out. It is not adequate, Wells Fargo, for you to say you don't talk about individual cases, because that's all we've got in this country are individual cases, people.

Drew thank you very much.

GRIFFIN: Thank you, Lou.

DOBBS: Drew Griffin, outstanding reporting.

Joining me now is Congresswoman Marcy Kaptur. You just saw her in Drew Griffin's report. Congresswoman, let me say to you, if I may, with all objectivity that I can muster, the fairness and balance, God bless you for taking this position. Because it's about time one of our elected representatives has the guts to say what you've said.

KAPTUR: Well, thank you, Lou, very much. You know, 10 percent of our properties have been foreclosed here in the last two years. And our community is not unique. And what has become very clear is that even though we were promised that the Wall Street bailout was primarily to address this home foreclosure crisis, it hasn't made a bit of difference.

DOBBS: But what I have to ask you now is that Congress has had the opportunity, the Democrats have been in charge of that Congress for two years. We have seen the Republican administration for eight years give corporate America a free hand.

We have seen both the Clinton administration and the Bush administration push back regulation. When are we going to see action by this Congress to relieve, to help the homeowner and take urgent, immediate action because this is not in any way -- anything less than a tragedy?

KAPTUR: It's a national crisis. And it is the proximate cause of this economic downturn; the housing foreclosure crisis. I did everything I could when Congress reconvened this year to urge the President, our Speaker, our leadership to move the FDIC and the SEC into their proper position in this economy to do these workouts.

And that has not been done. And this week we had to pass a stimulus bill in the House to try to pick up some of the casualties and give them a little life support. But the real problem is, that the FDIC and the SEC have been superseded by the U.S. Treasury Department, --

DOBBS: Right.

KAPTUR: -- which has no history in workouts. And that's the problem. They're using the wrong agency to resolve this crisis.

DOBBS: And Sheila Bair, the Chair of the FDIC, we've got to give great credit. She has been talking about this issue --

KAPTUR: Yes.

DOBBS: -- throughout. She has been sensitive and forthright about the issue. You know, I guess the issue here also becomes, we are a nation of laws. At what point does telling a person, as you have, to just exercise squatter's rights -- at what point are you bumping up against the issue of breaking the law?

KAPTUR: Well, you know, Lou, the problem is that these families haven't had proper legal representation. Most of these companies on Wall Street can't even find the loan, and they have not properly noticed the homeowner under the Truth and Lending Act and the Real Estate Practices Act. DOBBS: Right.

KAPTUR: If you really look at the fine print, these Wall Street firms can't find the loan. They've divided it up into so many pieces, so there's a legitimate question in the law as to where that deed, where that loan actually is.

DOBBS: In point of fact, it's not -- to be clear, if there's no note, there is no debt?

KAPTUR: That's right.

And if you don't have proper legal representation -- and I mean good legal representation -- what happens to the homeowner in places like our region is, they're law abiding people. They're afraid and they leave the property.

I say your biggest right is to hold on to your property. The law is on your side.

DOBBS: Marcy Kaptur, I'm sure that millions of Americans and the folks in Ohio appreciate you being on their side.

KAPTUR: Thank you.

DOBBS: Marcy Kaptur, thank you very much, Congresswoman from Ohio.

KAPTUR: Thank you.

DOBBS: Still up ahead, only a small part of the nearly $1 trillion stimulus bill going to fix our crumbling infrastructure. We'll tell you what you need to know, in "Lou's Line-Item Veto."

And former Governor Blagojevich says he'll clear his name.

We'll be talking about that, and a host of other issues, including the fact that the President of the United States stood up and actually stood up and said the right thing about what is happening with compensation on Wall Street.

Three top political analysts join me here next. We'll be right back.

(COMMERCIAL BREAK)

DOBBS: Good news, the senate has got its own version of the economic spending package. Our examination of the details of the legislation, the focus of our continuing "Lou's Line-Item Veto."

Tonight we focus on an element of the legislation that on its face deserves support: infrastructure investment. With the expected loss of one million construction jobs this year alone, you would think an intelligent, aggressive and substantial infrastructure investment program would be a priority for the Democratic leadership and the White House. You would be mistaken. Kitty Pilgrim has our report.

(BEGIN VIDEOTAPE)

KITTY PILGRIM, CNN CORRESPONDENT (voice over): Doug Pruitt is a successful contractor with 1,500 workers. Pruitt's Sundt Construction has infrastructure projects that include highways, bridges, dams and light rails.

But some of his projects have dried up. He has had to lay off about 100 workers so far. Nationally unemployment in construction averages more than 10 percent.

DOUG PRUITT, SUNDT CONSTRUCTION: There are several projects that were actually approved, that are not funded today or been de-funded. A lot of university work, several highway and bridge work projects have been de-funded, a lot of university work, several highway and bridge work, projects have been de-funded.

So it's putting a lot of stress on our industry here in Arizona.

NANCY PELOSI, HOUSE SPEAKER: The Bill is passed.

PILGRIM: Criticism of the stimulus is that while it was touted as an infrastructure program, only an estimated $66 billion of the more than $800 billion package is actually going to highways, mass transit, water and rail. And even by the broadest measure, including construction in related industries, estimates put it at $150 billion.

The work needs to be done. The American Society of Civil Engineers gives our nation's infrastructure a grade of "D" saying $2.2 trillion is needed over the next five years to bring it up to good condition.

SEN. JAMES INHOFE, (R) OKLAHOMA: Well, I thought this might be an opportunity to do something about infrastructure in America, providing the jobs, getting these things done. We could have had an opportunity here to put a larger percentage there, at least 10 percent of the total amount, and get something done that's meaningful.

PILGRIM: The Federal Highway Administration estimates that 30,000 jobs are supported with every $1 billion of federal dollars put toward highway spending. The Associated General Contractors of America, a trade organization of 33,000 members, lobbied hard to get money for infrastructure into the stimulus bill, saying the industry will lose 1.3 million jobs this year.

STEVE SANDHERR, GENERAL CONTRACTORS OF AMERICA: You've got states and local governments that have cut back. At the same time projects that are funded through private development funds are being held back as well.

PILGRIM: It's those cutbacks that have business owners like Doug Pruitt worrying that more of his work force will have to file for unemployment.

(END VIDEOTAPE)

PILGRIM: Now, the question is, how long will it take to get those jobs up and running. Now, the Congressional Budget Office has said it'll take five years to spend 85 percent of the money.

President Obama's director of the Office of Management and Budget told Congress three-quarters of the money would be spent in 18 months.

DOBBS: That's quite a range in estimates, which we've been reporting here.

This is some of the most expedient process ever applied to legislation, which the President was sent by President Bush, by a Democrat Congress back five months ago. Now, let's hope that something better will prevail in the Senate.

Thank you very much, Kitty. Kitty Pilgrim.

I hope you will consider calling and emailing your Congressmen and Senators. Give them your view on the course of this spending legislation, what you think about it, what you think it ought to be.

We invite you to go to our Website, Loudobbs.com. All of the contact information, re-elected officials, phone numbers and email addresses are there.

And a reminder to join us here tomorrow in "Lou's Line-Item Veto." We examine the money and the spending bill for small business. Small businesses create just about 80 percent of the jobs in this country. Do you think there's sufficient funding for those businesses in this so-called stimulus package? Well, we'll be telling you all about it tomorrow night in "Lou's Line-Item Veto."

Up next here, President Obama and House Speaker Pelosi taking credit for this new spending plan. Will they be working with Republicans in the Senate? Does it matter? I'll be talking with three of the best political analysts next.

And President Obama and his top military leaders clashing on a timetable for troop withdrawals from Iraq. We'll be talking with our military strategist, General David Grange, here, next.

We'll be right back, stay with us.

(COMMERCIAL BREAK)

DOBBS: Well, joining me now, Pulitzer-prize winning columnist, of New York Daily News and CNN Contributor, Michael Goodwin; and New York bureau chief of Washington Post, Keith Richburg; Carol Swain, professor of political science and law at Vanderbilt University, also, editor of Immigration and CNN contributor. Good to have you all here.

Let me start right now with the vote on Carol Swain, no Republican voting for that House stimulus package. Were you surprised? PROF. CAROL SWAIN, VANDERBILT UNIVERSITY: Well, I think that they're doing their job. Because so much is at stake, it's very important that we have some opposition to make sure that the proper -- that the package is what it could be.

DOBBS: Do you think the Republicans have a responsibility to do far more than just reflexively say tax cut, tax cut, tax cut?

SWAIN: Of course they do. I mean -- of course they do.

DOBBS: What do you think, Michael?

MICHAEL GOODWIN, NEW YORK DAILY NEWS: I was surprised, frankly, that Obama supported what was essentially the House Democratic bill, plus his tax cut plan which was designed to attract Republicans. So it seemed to be that there was very little public debate, it was Charlie Rangel wrote the thing, Nancy Pelosi, I mean, they sort of presented it as a fait accompli.

DOBBS: And Nancy Pelosi didn't even refer to it as stimulus package, she was talking about the new world order in effect.

GOODWIN: And all these things that the Democrats have wanted to do for years that could never get into a regular budget. Now we're going to borrow money to do all these things. These are not emergency things they are not a stimuli, as you said.

SWAIN: I believe that they feel that this is their only opportunity, given the economic situation, that if they don't get it in this bill, they're not going to be able to get it later.

DOBBS: Keith?

KEITH RICHBURG, WASHINGTON POST: Yes, I agree. The problem with the Republican side in the House was they'd lost a lot of credibility, basically because all they say is tax cut, tax cut, tax cut.

And secondly, they were not deficit hawks during the six years they controlled everything under President Bush --

DOBBS: Yes.

RICHBURG: -- and spending went up in the Iraq war. We're spending off the books. So all of a sudden, now that Democrats are in charge, they're really concerned about spending and borrowing.

So they lost a lot of credibility. I think the Obama administration just wanted to get this thing out of the House in whatever form and go to the Senate.

DOBBS: Senate Minority Leader Mitch McConnell today, saying something rather interesting about this and said, "we need to let taxpayers keep more of what they earn, which is sort of the mantra -- if you will for Republicans. He goes on to say, "Finally we should not be spending taxpayer dollars we don't have on programs we don't need." RICHBURG: Well, as I said, the problem with the Republican side is they've lost so much credibility over the years.

DOBBS: Well what about the McConnell statement?

RICHBURG: Well, because investing in school repair, is that something that's not needed? Investing in --

DOBBS: Is it stimuli?

RIGHBURG: It's stimulative if it's something that you have to do anyways. And I think the Obama side is saying, let's just do it now and get it over with and it will add in increasing jobs.

GOODWIN: Yes, I don't think Obama played a big enough role in this, and I'm surprised that he let the House Democrats set his agenda for him. I don't think that was a good thing. Nancy Pelosi is not well regard now; she is not the bipartisan person that Obama said he wants to be. I think he should have taken more control of this and done his own bill.

DOBBS: Done his own bill. It's about $2 billion a page. No one that we could determine had fully read the legislation, staffs have not done complete workups on it, in which we have pretty good intelligence on. We're told that that's changing almost as we speak.

(CROSS TALK)

DOBBS: But the fact is the Senate which has a requirement -- not a requirement, unfortunately it's not a requirement, a reputation of being a deliberative body Carol Swain, surely there will be original thinking, more responsible thinking brought to bear on this. Are you hopeful?

SWAIN: If they start with this Congress actually reading this legislation, that will be change we can use because it has been known that staffers have undue influence on legislation --

DOBBS: Right.

SWAIN: -- and many members of Congress never read it.

DOBBS: President Barack Obama today said that basically I'm going to put the -- I'm not going to do that. I just got a cheer, President Obama having the principle -- I don't care whether it's the politics or the principle -- but having the guts to stand up and say excessive compensation on Wall Street is not going to stand -- my words not his but he gave that clear impression, you're reaction?

RICHBURG: I think that's exactly what the American people want to hear. And I think he can actually follow it up and do something about it now other talk about it.

GOODWIN: It's obviously a very public popular position. My problem is that we should not have given the money to the banks. I mean, we are in the situation -- DOBBS: But the Congress lied to the American people --

GOODWIN: Right.

DOBBS: -- saying that they were going to stop the executive compensation -- excessive compensation in the first TARP bill. They lied.

GOODWIN: And so now what we have is the fact that government telling the banks what to do. I don't think we want to be in that position.

DOBBS: You know what? At this point, I sure don't want the banks telling us what to do. All right, I appreciate it, Michael Goodwin thank you, Carol Swain, Keith Richburg, thank you.

SWAIN: Thank you.

DOBBS: At the top of the hour, Campbell Brown, "No Bias, No Bull". Campbell, tell us all about it.

CAMPBELL BROWN, CNN ANCHOR: Hi Lou.

You showed some of it at the top of the hour. But not all of it, it was a pretty remarkable event, Rod Blagojevich, hours after being fired by the Illinois legislature, in front of his House explaining his side of the story.

And as we've come to learn, he would not stop talking. We're going to show you that.

Also President Obama cracking down on Wall Street excess, he's saying what a lot of Americans are feeling right now. We're going to hear the President in his own words, that as well coming up at the top of the hour -- Lou?

DOBBS: Thank you very much Campbell, we look forward to it -- we may not have shown it all. I thought we have but I can tell you this, we showed all of it I could stomach.

Thanks Campbell.

Coming up, the sharp disagreement on the issue of troop withdrawals from Iraq between the President and his top military commanders, at least some of them. Our military analyst General David Grange joins us here next. We'll be right back.

(COMMERCIAL BREAK)

DOBBS: Well, President Obama and the U.S. commander in Iraq, General Ray Odierno, sharply disagree on the issue of the rate of troop withdrawals from Iraq. President Obama who met with his joint chiefs yesterday wants our combat troops out of Iraq within 16 months, but the General Odierno wants a much slower withdrawal.

Joining me now at Lou Dobbs our military analyst General David Grange. David, first of all it's good to see you. What do you make of this difference of opinion between the commander-in-chief and one of his top generals?

BRIG. GEN. DAVID GRANGE (RET.), CNN MILITARY ANALYST: Well, it's the General's responsibility to tell the commander-in-chief what his best assessment is on the ground. And it doesn't synchronize exactly with the promises made from the campaign with our President.

So what the President has to do is say, who am I going to listen to? Am I going to honor what I said in the campaign or go with ground troops? And I think the commander on the ground knows that. What I would recommend the President does is just say hey, I'm still going to try to 16 months, but I may do two brigades one month, I may skip three months, I'm going to go with the ground commander.

DOBBS: But going with the ground commander, with what you just said, puts him in a bad position. Do you get the sense that the General Odierno is saying that he can meet that demand of 16 months, it's a question of rate because it looks like there was something more profound in than just mere rate?

GRANGE: Well, the beginning of the discussion, I believe was his next few months, but as time goes on, it could change again. So again, it goes back to you got to listen to your troops on the ground and then compare that to the other advice you get on other secretarial people and that in the cabinet and make your decision.

But the people on the ground can smell the battle; they know what's going on. So it would not be too smart not to listen to him.

DOBBS: Absolutely and how smart will everyone be on the issue of Pakistan? This President has committed himself to engagement of more troops, the generals, their view, are they in absolute agreement there? Is everyone in concurrence?

GRANGE: I think everyone is in concurrence with more troops. But again, the troops themselves will not win this fight. You have to have these other elements of power that we've talked about in the past, the economic information, et cetera. And you have to use that in order to not have to go into Pakistan which we won't do, to the sanctuaries and those types of things.

So I think the President is correct, go after this extremists, take them down but do it with other elements of power to make it work for the long term.

DOBBS: Again, the issue of what we ran into in Iraq, what we have heard President after President say he would not do and that has put us in a position of not being able to extricate our forces under an intelligently crafted and considered exit plan. Does such a thing exist for Afghanistan?

GRANGE: I think the exit plan is being constructed as we speak. I think there's a lot of buzz going on in Washington right now with a new strategy, with what they call a whole of nation approach, using all elements of power, coordinating with adjacent country's desires and working with the local populous.

And if that's the case, I believe it will work and it will have a very workable exit strategy.

DOBBS: All right, General David Grange, as always, thank you.

GRANGE: My pleasure.

DOBBS: For our poll results, 59 percent of you do not believe the Obama administration will have the principle and guts to do more than talk about excessive Wall Street compensation. Now they certainly have the guts to take it on as an issue, which is something recent Presidents have not had the guts to do. So we will see how that works out.

Time now for some of your thoughts.

Danny in Pennsylvania, "I'd like to suggest that any state getting from the bailout be required harboring illegal aliens. California is billions of dollars in debts but spends millions on illegal aliens."

And Marci in Illinois said, Lou "When will Congress stop playing 'don't ask, just pass' emergency spending?" Great question, we'll find out probably as soon as next week.

We love hearing your thoughts, send those thoughts to us at Loudobbs.com. Thank you for being with us tonight. Join us here tomorrow.

Campbell Brown "No Bias, No Bull" starts right now -- Campbell.