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Lou Dobbs Tonight

Banks under Siege; What Economic Policy; Triple Threat to the U.S.; Down on Obama; Illegal Alien Stimulus; Importing Nurses

Aired March 09, 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: Thank you, Wolf.

Tonight new evidence the stock market has no confidence in President Obama's economic policies. Investors are now ignoring the president's assertions that he isn't a socialist. We'll have complete coverage of the issue and the controversy.

Also tonight the government's huge stimulus package would give jobs to hundreds of thousands of illegal aliens. Some lawmakers say that's just fine. We'll have that special report.

And tonight, a rising number of Americans say they have no religion. We'll examine what this means for our society, our nation. I'll be talking with two of the country's leading thinkers on religion and politics, all of 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 Monday, March 9th. Live from New York, Lou Dobbs.

DOBBS: Good evening, everybody. The White House today launched an all-out attack against critics of the president's tax, borrow and spend policies. White House press secretary Robert Gibbs saying the president has taken what he called strong and decisive action to tackle our economic crisis. This, after the president himself tried to convince skeptics he believes in free market principles saying he's no socialist, but that didn't convince the stock market.

The Dow Jones industrials today down another 80 points. It's now at a new 12-year low. The Dow has plunged almost 20 percent since the president's inauguration on January 20th. Some Republican lawmakers say it is now time for the Obama administration to take dramatic action to shore up our banking system and prove that it believes in the free market -- Candy Crowley with our report from Washington.

(BEGIN VIDEOTAPE)

CANDY CROWLEY, CNN SR. POLITICAL CORRESPONDENT (voice-over): Somewhere inside this building, Treasury Secretary Timothy Geithner has sorted through how, whether and which financial institutions should get federal help, $250 billion was set aside to stabilize big banks in big trouble. That's in addition to the 350 billion already spent by the Bush administration. There is an additional 25 billion for Citigroup and 20 billion for Bank of America. Stable banks lend money, which as the president noted to "The New York Times" is the point. BARACK OBAMA (D-IL), PRESIDENT OF THE UNITED STATES: Our commitment is to make sure that any actions we take to maintain stability in the system begin to loosen up credit and lending once again so that businesses and consumers can borrow.

CROWLEY: The choices for the administration include giving financial institutions short-term loans with interest, purchasing more bank stocks or as Geithner has already outlined a public private plan to buy up bad assets. Senator Richard Shelby, the top ranking Republican on the Banking Committee says there's another option, let the banks fail.

SEN. RICHARD SHELBY (R), ALABAMA: But some of our big banks are zombie banks. Some of our banks basically are walking dead. The market believes some of them have basically already failed or failing. And if we prop them up the question is how long will this last and how much money to the taxpayers.

CROWLEY: Ditto, John McCain thinks on FOX News who thinks the same should go for the auto industry and says the Obama administration is not stepping up to the plate.

SEN. JOHN MCCAIN (R), ARIZONA: I don't think they have made the hard decision and that is to let these banks fail, to let General Motors go into bankruptcy and reemerge and reorganize with new contracts with labor and others.

CROWLEY: Administration officials push back against the notion that bank bailouts will be a bottomless pit and the president told "The Times" an awful lot of banks are in decent shape. But he made it clear failed banks are unacceptable.

OBAMA: No, no, no. But what we'll have to do is we'll probably have to take more significant action to deal with those institutions.

CROWLEY: Administration aides say financial institutions like Citibank and Bank of America are simply too big to fail, said one aide, "it would send shock waves through the entire system."

(END VIDEOTAPE)

CROWLEY: Shelby argues if you take a look at the market, you understand the shockwaves are already there. And he recalls testimony by former Fed Chief Paul Volcker (ph) who said some banks are not only too big to fail, some are too big to exist. Lou.

DOBBS: It's amazing to hear both McCain and Shelby on the same day talk about banks failing, Citigroup, its stock today closing at $1.05. That is just five or six cents north of failing. This is -- where is this headed?

CROWLEY: Well we'll see. At the moment, there's nothing that any lawmaker can do about how they spend the rest of the TARP money, the other 350 billion, which is really pretty much already been allocated. It does spell some trouble unless there is significant improvement in the economy. It does spell some trouble if the administration has to go back and ask for more money. Now they've already put a place marker in the current budget just in case they needed to go back for some more bank industry bailout. But it's going to get tougher and tougher as we go along if there are not some successes along the way.

DOBBS: When we have place makers in legislation rather than policy, we've got already a worsening problem. Thank you very much Candy. Candy Crowley.

The White House today declared the president remains focused each and every day on our economic crisis, but critics say the president has been overwhelmed by the severity of this recession and his policies of bigger government could actually worsen the crisis. Ed Henry has our report from the White House. Ed, so where is the president's focus?

ED HENRY, CNN WHITE HOUSE CORRESPONDENT: Well, Lou, as you noted, senior aides here insist that he is focused on the economy, but the president is facing tough questions tonight about whether he's filling his plate with so many side issues that it's preventing him from really focusing full time on this financial crisis.

You know today he signed an executive order overturning a Bush policy that limited the types of stem cell research that can receive federal dollars. Tomorrow the president giving a major speech on education reform, all this coming after Warren Buffett, an informal economic adviser to this president told CNBC it's a mistake when you have one overriding objective, to in the words of Buffett quote, "try and muddle it up with a bunch of other things."

One reporter today asked Robert Gibbs whether it's smart to be focusing on some side issues at a time when a reporter said the house is on fire. Robert Gibbs responded the president is trying to save the whole house, not just a few rooms.

(BEGIN VIDEO CLIP)

ROBERT GIBBS, WHITE HOUSE PRESS SECRETARY: Which room are you going to put out first or are you going to call the fire department and ask them to put it all of it out or are you going to say you know what? We love the living room. Start over there. And if you can, get quickly to the kitchen and next to the den. We could do that and maybe by the time they get to the kitchen or the den the whole house is in ashes.

(END VIDEO CLIP)

HENRY: Now Robert Gibbs' point was that it was not one single factor that caused this crisis. You can include everything from the foreclosure crisis, the banking issues you were just talking about with Candy, as well as education reform, a failing education system in the estimation of some critics, as well as soaring health care costs that the president has talked about that's also dragging down the economy. So what Robert Gibbs is saying is the president is trying to tackle all of this at once, but as you can see, even some people who have advised the president, like Warren Buffett are saying it may be too much too soon -- Lou.

DOBBS: And yet we see his press secretary at the White House act out of some sort of precious, too cute by half (ph) personality with absolutely irrelevant nonsense about Warren Buffett's central point, which is the primary issue is an economic crisis that this president spent his first six weeks saying was dire, it would lead to catastrophe and now it's worthy of distraction. This makes no sense.

HENRY: Certainly as you heard from Warren Buffett himself, he believes there should be a singular focus on the financial crisis. Obviously there are other issues out there the president does have to tackle, but as you were talking about with Candy, I think a lot of the pressure is really on the Treasury secretary, Timothy Geithner. There were some high expectations about a month ago, as you know, when he first rolled out what was suppose to be the next phase of these bank bailouts. Wall Street, but also people on Main Street criticized there was not enough details there. Here we are about a month later and we still don't have those details, Lou.

DOBBS: Don't have details, Geithner doesn't even have his top 17 deputies in place at Treasury and the stock market has lost 20 percent since this president was sworn in. He has his own bear market. That's the definition of a bear market, a 20 percent decline. This is now the Obama bear market and there is not -- there is this sort of silly antics on the part of his press secretary to talk about rooms on fire. You know, a silly analogy and not worthy of the White House or a spokesman for it, in my opinion. Thank you very much, Ed Henry. Appreciate it.

HENRY: Thank you.

DOBBS: The president's focus on his domestic agenda appears to be distracting much of his administration from tackling what are now escalating threats to American interest around the world. Communist Chinese ships aggressively harassing an unarmed U.S. ship in the South China Sea in international waters. At the same time, North Korea and Iran are stepping up their preparations for a possible military conflict. Kitty Pilgrim has our report.

(BEGIN VIDEOTAPE)

KITTY PILGRIM, CNN CORRESPONDENT (voice-over): Three aggressive actions by U.S. adversaries, China harasses U.S. vessels in international waters, North Korea threatens war if the U.S. interferes with its missile test. Iran is thought to have enough nuclear material for a bomb. No clear U.S. response.

KIM HOLMES, HERITAGE FOUNDATION: We don't really have a lot of clarity on what it is they plan to do. There's a lot of problems out there that need the direct attention of the president.

PILGRIM: Take for example this weekend, several Chinese ships surrounded and harassed an unarmed U.S. Navy vessel in international waters. The U.S. policy response: A diplomatic protest.

GIBBS: We're going to continue to operate in those international waters and we expect the Chinese to observe international law around there.

PILGRIM: The Obama administration admits Chinese ships have been quote, "increasingly aggressive". Secretary of State Hillary Clinton was criticized on her trip to Beijing when she offered more military cooperation.

GORDON CHANG, AUTHOR, "COMING COLLAPSE OF CHINA": A month ago, out of the blue, Hillary Clinton offers to resume military-to-military ties and really gets nothing in return.

PILGRIM: Another example North Korea has threatened war with the United States if it interferes with its so-called satellite tests, which most believe is a cover for a long-range missile test. U.S. policy on the upcoming North Korean missile launch: Nothing so far.

ADMIRAL MIKE MULLEN, JOINT CHIEFS CHAIRMAN: There have been no decisions with respect to what America might do. The president has made no decisions. Secretary Gates and I have made no recommendations, but it's an area that we watch with great concern and I would hope that North Korea would not be provocative.

PILGRIM: Admiral Mullen also admitted Iran has enough nuclear material to make a bomb, but just two months ago, Defense Secretary Gates said quote, "there is no immediate military threat from Iran."

(END VIDEOTAPE)

PILGRIM: Some foreign policy analysts wonder why the Obama administration is throwing away negotiating advantages by naively opting to change U.S. foreign policy without asking for anything in return from countries like Russia, Iran, North Korea and China -- Lou.

DOBBS: This is -- if it weren't so serious, it would be laughable. The idea as Mullen, the good admiral says we have no recommendations, we have no policies, we have no plan, no clue, basically is what they are saying about what they are doing.

PILGRIM: Yes, watching it closely. That doesn't really...

DOBBS: I mean they're starting to -- the Pentagon is starting to sound like the State Department, which started sounding like well the Chamber of Commerce long ago. Kitty Pilgrim, thank you very much.

Well still ahead here, rising evidence that President Obama's stimulus package could benefit illegal aliens before unemployed American citizens, what's the problem? We'll tell you about that.

Also why you shouldn't take investing advice from this man -- Warren Buffett is a good guy, but he's got a really bad record over the last four months and some startling comments today. We'll be right back.

(COMMERCIAL BREAK)

DOBBS: Billionaire investor Warren Buffett, one of those who gives economic advice to President Obama says he's never seen Americans and American consumers more fearful than they are now. In a television interview this morning on CNBC, Buffett offered his opinion on the state of our economy.

(BEGIN VIDEO CLIP)

WARREN BUFFETT, CEO, BERKSHIRE HATHAWAY: The economy, ever since we talked in September, we talked about it being an economic Pearl Harbor and how what was happening in the financial world would move over to the real world very quickly. It's fallen off a cliff and not only has the economy slowed down a lot, people have really changed their behavior like nothing I have ever seen.

(END VIDEO CLIP)

DOBBS: Fallen off a cliff, that's a big difference as for the -- to the advice that he had offered investors just last October when the recession was nearly a year old. In "The New York Times", Buffett referring to the stock market said at the time, quote, "buy American. I am and quote I have been buying American stocks." He added "fears regarding the long term prosperity of the nation's many sound companies make no sense."

Buffett didn't offer a time frame for when the market would recover, but since that "New York Times" column, The Dow Jones industrials have lost 26 percent and shares of Buffett's own company, Berkshire Hathaway, are lagging the market down 39 percent. In this morning's television interview, Buffett said "in five years the American economy will be running fine."

Stocks today closing at the lowest level however since 1997, investors unconvinced that there is any plan that would fix this economy or that there is any leadership that will be beneficial from the Obama administration. Lisa Sylvester has our report.

(BEGIN VIDEOTAPE)

LISA SYLVESTER, CNN CORRESPONDENT (voice-over): Stock values have been headed in only one direction, down, the Dow Jones industrials closing at a new 12-year low. Since president Obama took office in January, the Dow Jones has dropped nearly 21 percent. Retirement funds, personal savings and college funds taking the hit, bankers are looking for fast answers.

JACK ABLIN, HARRIS PRIVATE BANK: I think the Democrats have a lot to worry about. I mean this is their show now and no longer you know can we use that this is what we inherited rhetoric.

SYLVESTER: Jack Ablin of Harris Bank says the markets are not responding positively to some of the administration's proposals. He says Obama's plans to cap home mortgage interest deductions and limit charitable contribution deductions for upper income families and use the proceeds to expand health coverage does not create a climate favorable for investors and risk takers.

Other analysts wonder if the Treasury Department can really dig the economy out? Trillions have been spent but no signs of a recovery in the first few weeks. More than a dozen senior positions at the Treasury Department remain unfilled leaving Treasury Secretary Timothy Geithner without a lot of back up support when he needs it most. That's worrying for some investors.

J. PATRICK CAVE, CYPRESS GROUP: He's got a team of coaches that's half filled out and I think that is the proper analogy. You're expected to play both offense and defense.

SYLVESTER: The White House says the positions will be filled when the right people are found and put through the process. They filled three top jobs over the weekend. Democrats insist their plan will work, but they say a recovery won't happen overnight.

SEN CHUCK SCHUMER (D), NEW YORK: The three legs to the stool, the money to get -- create jobs and get the economy going in the stimulus, the housing program, which should find a floor to the housing market and next the shaking up of financial institutions.

SYLVESTER: Wall Street is notorious for looking for short term gains or at least signs of better things to come. With things not turning around quickly, the president's message of hope that brought him into office may start to ring hollow among those looking for a fast fix.

(END VIDEOTAPE)

SYLVESTER: And Jack Ablin with the Harris Bank says from an investor's standpoint, when we changed administrations, we went from Goldilocks to Robin Hood and investors have to see that there is a payout for risk taking and with some of the president's tax and budget plans, they are just not seeing that, Lou.

DOBBS: All right, thank you very much, Lisa. Appreciate it. Lisa Sylvester.

Angry Californians tonight are lashing out against their state government's tax and spend policies. Thousands of Californians rallying this weekend protesting new tax hikes, many blaming Governor Arnold Schwarzenegger. The governor and the State Legislature Democratically-led approved tax increases and service cuts trying to help close a $42 billion budget deficit. But the message of outrage taxpayers hasn't been heard by a lot of California lawmakers. In fact, state legislators have now introduced hundreds of new spending bills just since last month's budget compromise.

New outrage tonight that hundreds of thousands of illegal aliens will receive jobs under the federal stimulus plan. A new study show those jobs would be primarily in the construction industry. The hiring of illegal immigrants would be prevented however if businesses were using the federal E-Verify program. E-Verify is the most successful federal program to prevent illegal workers from taking American jobs. Casey Wian has our report from Los Angeles -- Casey.

CASEY WIAN, CNN CORRESPONDENT: Lou, the federal stimulus bill is expected to create about two million construction jobs, many of them on highway projects like this one over the next several years, but about 15 percent of those jobs or about 300,000 positions could go to illegal aliens, according for the center -- according to the Center for Immigration Studies.

That's because Congress decided to remove a provision that would have required all contractors receiving federal money, federal stimulus money to enroll in the E-Verify program and use it. Now an E-Verify mandate was part of the House's version of the stimulus bill, but it was not in the Senate's bill and it did not make the final version.

(BEGIN VIDEO CLIP)

STEVEN CAMAROTA, CENTER FOR IMMIGRATION STUDIES: This was a conscious effort. It was in there and they took it out. Why did they take out E-Verify? Well it's hard to say, but it seems that it was an effort to give something to the ethnic advocacy groups within the Democratic Party and this way at least it's like a cutback in enforcement of immigration laws.

(END VIDEO CLIP)

WIAN: Now all of this is happening while a growing number of businesses are voluntarily signing up for E-Verify. The Department of Homeland Security is expected to process 17 million inquiries for more than 100,000 employers using the E-Verify system just this year and despite it's rapidly rise in popularity, the Obama administration has delayed until May 21st, making E-Verify mandatory for all federal contractors. This is causing many border security advocates to say that this administration is simply trying to weaken immigration law enforcement, Lou.

DOBBS: And there shouldn't be a surprise there. President Obama as a candidate made it very clear he was in favor of amnesty; he's in favor of driver's license for illegal aliens. It's a very direct record that he put forward. It's one of the clearest in fact I think you could say for any part of his campaign. But the idea that E- Verify -- I talked with Senator Jeff Sessions today, who tried to put forward an amendment that would extend E-Verify for five years, Casey and Senator -- Senator Harry Reid, the majority leader would not permit, when Senator Mitch McConnell, the minority leader advanced it as an amendment wouldn't permit and objected to it's inclusion.

So there is a vast within the ominous bill, a six month extension. This is -- this is such double speak on the part of -- frankly the administration and Senator Harry Reid. And saying one thing to their constituents, saying another once they have the power to move an amendment forward.

WIAN: Yes and Lou, and to that point, then candidate Obama and his now Department of Homeland Security Secretary Janet Napolitano (ph) both publicly came out in support of E-Verify, that this administration and the Democratic leadership in Congress seem to be doing everything they can to delay its further implementation, Lou.

DOBBS: Yes and I don't think that we should in any way pretend that we are shocked that it would be politics as usual despite all the hoopla about change that we could believe in up until about November 4th. All right, Casey, thank you very much -- Casey Wian from Los Angeles.

You can help save E-Verify. As we've reported, it is the most successful federal program aimed at keeping illegal immigrants out of our work force in this country. It has an accuracy rate, by the way, of better than 99 percent. Tell your elected officials in Congress that you want them to save E-Verify and please go to our Web site at loudobbs.com to contact your senators or your congressman.

We'd like to know also what you think tonight. Our poll question is do you believe the Obama administration and the congressional Democratic leadership are actively working to effectively end immigration law enforcement in this country? Yes or no. Cast your vote at loudobbs.com. We'll have the results here later in the broadcast.

Up next, a sex scandal exposed. Hundreds of pages of messages between the former Detroit mayor and his chief of staff released today. We'll take a look with you.

Also a shocking robbery attempt caught on video with a key piece of evidence left behind. That's coming up next.

(COMMERCIAL BREAK)

DOBBS: Well, some outrage tonight over new efforts to bring more foreign nurses into the United States. New legislation in Congress would bring in as many as 50,000 nurses from cheap foreign labor markets. It's all happening as millions of Americans are unemployed and millions more being laid off. And thousands upon thousands of qualified applicants are being turned away from our nursing schools. Ines Ferre joins me now with the story -- Ines.

INES FERRE, CNN CORRESPONDENT: Yes, Lou, the bill is called The Nursing Relief Act of 2009 and it asks for a new nonimmigrant category for up to 50,000 nurses a year from countries like the Philippines, India and China. Now the U.S. faces a shortage of nurses with more than 100,000 job openings, a number that could be five times higher by the year 2025.

One of the bill sponsors, Republican John Shadegg, told CNN quote "I would prefer to fill these vacancies with Americans, however in the short run these shortages far exceed the U.S. supply of registered nurses and nursing school candidates combined." Now, the issue came up during the health care summit last week where President Obama disagreed with bringing in foreigners to do the job.

(BEGIN VIDEO CLIP)

BARACK OBAMA (D-IL), PRESIDENT OF THE UNITED STATES: The notion that we would have to import nurses makes absolutely no sense. We could be training nurses right here in the United States and there are a lot of people who would love to be in that health profession and yet we just aren't providing the resources to get them trained. That's something that we've got to fix. (END VIDEO CLIP)

FERRE: And there are plenty of qualified Americans eager to train to become nurses. The problem is lack of faculty and education funding.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: We documented last year that 50,000 qualified applications to schools in nursing were turned away. In fact, there's an application acceptance rate of less than half, so it would seem more reasonable to look at bringing in the people who are right here in the United States who want jobs, very well paying jobs.

(END VIDEO CLIP)

FERRE: And The Nursing Association says that foreign nurses are often at the low end of the pay scale, but the average nursing salary is about $61,000 a year, a salary that plenty of Americans, Lou, would love to have.

DOBBS: Yes and I think we have to be very, very straightforward here. The reason those foreign nurses are being brought in is not simply a shortage of American nurses. It is because we have not provided the resources to train those nurses. It is because hospitals and those hospital-owned, the companies that own those hospitals are bringing in the cheapest labor possible. They are trying to avoid paying that salary. It's the same reason that's behind the -- all of the visa workers coming into this country. And people should be very honest about that. This president knows that and it's got to be stopped as a matter of public policy.

FERRE: And one of the facts was that you know these faculty members are often -- they often earn less than a registered nurse practicing, so oftentimes they'll want -- they'd like to be teaching, but they are out there because they are earning more money. Yes, one of the things is that in the budget, the 2010 budget plan, there's $330 million for addressing this nursing shortage. The Nursing Institute says that that's great, but we need more.

DOBBS: Absolutely. We need more and we also need leadership from this president. This can't wait until 2011 for a resolution. Thank you very much. Ines Ferre.

Time now for some of your thoughts; Jan in Georgia said: "Our president wants 'change' all right, yours, mine and everyone's. Soon we won't have any money left."

Tom in Florida: "Lou, this is a call to all America. Tell our government to stop the madness. They are spending taxpayers' money like they are kids in a candy store." My friend, they are.

And Jack in Ohio: "There's a lot of talk about whether we have hit the bottom yet in this economic adventure -- I like that -- this economic adventure. I think (Treasury Secretary) Geithner based on his experience is absolutely, if not uniquely, qualified to get us there."

We love hearing from you. Send us your thoughts to loudobbs.com.

Tonight, more salacious text messages released from the sex and perjury scandal involving former Detroit Mayor Kwame Kilpatrick and his former chief of staff, Christine Beatty. Those texts were used as evidence in a police whistle blowing trial last year. A few "G" rated samples in the 1,400 messages pulled from the city pagers. The former mayor telling his chief of staff by text, "I realized you are the wind beneath my wings. I love you so much it hurts sometimes." Beatty says to him, "You are everything that I never dreamed I could have in a lover." If you get by the grammatical errors and construction of the sentence, it probably means something better than it was actually written as. Perhaps the most ironic text from Beatty, "Erase your messages, sent and received." Clearly that didn't work out, the mayor serving four months in jail for obstruction of justice. Beatty is serving for bad judgment.

Former NBA star Charles Barkley is out of jail tonight. He served a three day sentence for drunk driving in the famous tent city, reporting to the jail in Phoenix Saturday morning. Sheriff saying he didn't wear a jail uniform or the signature pink underwear because he was part of a work release program and also because he's about 6'8" and 300 pounds. Barkley stayed in a separate tent from other inmates as his meals were brought to him. They are baloney sandwiches like the other inmates there. Tonight, we'll find out.

A brave store owner is safe and uninjured after fighting off an armed robber in the city Brockton, Massachusetts. It was all caught on video. The robber is seen pushing behind the counter with a loaded shotgun. The store owner fights back, putting the robber in a choke hold. The robber ran away, leaving a sneaker. It could be the clue in solving a recent string of robberies. Let's hope so.

In Illinois tonight two parishioners are recovering from knife wounds after wrestling a gunman who had shot and killed their pastor during services yesterday. Police say 27-year-old Terry Sedlacek walked into the First Baptist Church in Merryville, Illinois, changed words with a pastor, shot and killed him. He was trying to deflect, the pastor was, the gunshot with his bible. Two men tackled the shooter until police arrived. He's charged with murder and battery. He suffers from Lyme disease and takes medication that causes sometimes erratic behavior.

Severe weather across the Midwest causing serious damage. Thunderstorms ripping through Indiana, a tornado hitting southern Lawrence County. Dozens of homes destroyed, gas lines ruptured, no serious injuries however. Ohio, heavy rains there leaving streets swamped in the northern part of the state which has already suffered two serious floods. Businesses have been piling up sandbags for more rain, which are expected tonight.

Up next, many states are threatening your second amendment right to bear arms even as they declare they're upholding the constitution. We'll straighten that out. And a startling new study on the impact of organized religion on American society. I'll be joined by leading authorities on religion, politics and society here next. Stay with us. We'll be right back.

(COMMERCIAL BREAK)

DOBBS: The number of Americans who don't believe in religion is rising and rising dramatically according to the American religious identification survey. 15 percent of those polls say they have no religion. It's up 8 percent since 1990. The study found that northern New England was the least religious area of the country. The number of Americans with no religion rose in each state. Christians are down from 86 percent in 1990. It showed 12 percent of those polled believe in a higher power, but not a traditional god as defined by organized religion. Joining me now with more on the state of religion in this country and its likely impact on our society, we're joined by Tony Perkins, the president of the Family Research Council, co-author of "Personal Faith, Public Policy," and William Donohue, president of the Catholic League. Gentlemen, great to have you with us. Your reaction, Bill, first to the numbers. They are dramatic.

WILLIAM DONOHUE, PRESIDENT, CATHOLIC LEAGUE: They are. They confirm what the Pew survey found out last year. You know, we live in a society for the last quarter century marked by radical individualism. The three most dreaded words are thou shalt not. What you have here is that the vast majority of the people who don't believe in religion, don't believe in the traditional god. Notice they are not atheists or agnostics, they are simply saying I don't want to be told what to do with my life. Not surprisingly, Vermont is number one in this. Why? Every hippy dippy in the country in the last 25 years moved up to Vermont and is reaping the benefits.

DOBBS: Let's see if we can get collaboration on that. Tony has every hippy dippy, is that correct?

DONOHUE: Yes.

DOBBS: Have they all moved, or are they anywhere else?

TONY PERKINS, FAMILY RESEARCH COUNCIL: Let me get my dictionary. If this poll is taken next year will the out come be different, as the economy goes downward, I think people are going to be driven to religion. Actually, the decline was in the 1990s. Since the last poll was taken in 2001 to present, the decline has been less than 1 percent. It's not been a dramatic decline in this decade, it was in the decade of the '90s. We are seeing that decline ease up. I would say you might even see a reversal. What's happening, those 76 percent that identified themselves as Christians, 44 percent were born again or evangelical, showing a trend toward conservatism in religious faith.

DOBBS: As we are watching religion lose people, it is certainly a fact of 21st century life that people are participating in organized religion. In the Catholic Church it's moving from the northeast to the southwest. Evangelicals are disaffected from politics. Catholics are seemingly split rather rigorously on the political spectrum. Both Catholics and Protestants certainly in this country, Christians, are moving into the public square with their political beliefs and doing so with a greater freedom to do so than I have seen anytime in my career. Do you agree, Tony?

PERKINS: It's not without resistance, Lou. And first let me just say this, not to disagree with you, but the decline has been in the main line denominations. That's where you see the significant decline of double digits. You're actually seeing a growth in the nondenominational movement where people are many times more conservative in their beliefs.

DOBBS: For the heathens among us, what do you mean when you say non-denominational nondenominational?

PERKINS: In the survey they showed more people are no longer identifying with a particular denomination such as Baptist or Methodist. Evangelical Christian, but nondenominational. That might be a part of why we are seeing a decline as opposed to a growth. Some are intimidated to show their religion.

DOBBS: I have to get you in here.

DONOHUE: The greater the growth, the more progressive, they are dying. The same within the Catholic Church. From my perspective, that's a good thing. If your profession is a nun, or priest. The hippy dippy is not just in Vermont. It's all over the United States. Tony said things leveled off since 2000. What happened in 2001, 9/11. They begin to rethink things. I'm not pessimistic about the future.

DOBBS: Tony Perkins, we thank you both. Appreciate it.

PERKINS: Good to be with you.

DOBBS: Senator Tom Coburn says there's no way he'll vote for the spending bill unless there are drastic changes. Senator Coburn joins me here next.

Many states adding restrictions to your second amendment right to bear arms.

Mayor Michael Bloomberg and his efforts to sue gun makers and make them responsible for what outlaws do. That story, next.

(COMMERCIAL BREAK)

DOBBS: A major defeat for New York's Mayor, Michael Bloomberg, and what have been about four years of efforts to sue the nation's gun makers. The U.S. Supreme Court rejecting the city's lawsuit against the fire arms industry. Bloomberg arguing the industry violated the law because some of the guns were used in crimes in New York City trying to make the gun makers liable. Among the manufactures sued by Bloomberg were Colt, Smith and Wesson, Beretta and Glock. The Supreme Court action today supports the gun makers obviously. A 2005 federal law provides gun makers with broad immunity from lawsuits. The mayor said the city is examining whether to pursue other legal options. They are out of luck. Elsewhere in the country, our right to bear arms under the second amendment is also under assault. The FBI providing instant background checks for all who purchase guns. Some states insist on doing their own checks and then they add restrictions on the gun owners and the process and a few fees. Bill Tucker has the report.

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BILL TUCKER, CNN CORRESPONDENT: States don't have to charge for background checks on gun purchases. Background checks are required by federal law, the FBI provides the service for free. Currently 29 states use the service at no charge to the buyer or the state. Other states handle the checks differently. Eight states do their own background checks leaving background checks up to the feds. 13 states run their own checks on purchases of both handguns and rifles, running a check against the FBI data base and the state's data base charging fees for the checks. Wisconsin needs more money for state law enforcement programs, so it wants to raise the fees on handguns from $8 to $30. It's more than twice the actual cost of running the background check according to the Wisconsin Attorney General's Office. The actual cost to the state, $13.

The Brady Group, advocates of gun control and the name sake of the background checks, defends it state's right to charge the fee saying, "If a state wants to offer Brady background checks without a fee, they are free to do so." The state legislatures in those states have to make up the funding the state agency, which charges the fee would lose. It's the action that angers defenders to bear arms. It amounts to little more than gun control.

LARRY PRATT, GUN OWNERS OF AMERICA: I think it goes beyond balancing the budget of the gun owners. They are trying to discourage gun ownership. They argue it's discouraged by pricing and regulating the second amendment beyond the reach of many citizens. Gun rights groups say if the states want to save money, they should cut state spending and let the federal government handle the background checks. We're already paying for it with tax dollars.

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DOBBS: It's double jeopardy. It's an effort to control gun ownership. Thank you very much, Bill Tucker.

A reminder to vote in our poll. Like to hear from you, yes or no, please at loudobbs.com. We look forward to your vote.

Up next, the senate showdown over a spending bill loaded with pork barrel spending. Senator Coburn joins us. It's Barbie's birthday. Wow, that's news. We'll tell you something about her you don't know. It will be something I don't know, either. We'll be right back.

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DOBBS: A Senate vote on a massive $410 billion spending bill is expected as soon as tomorrow. Senate Republicans say the bill is loaded with thousands of earmarks, almost 9,000 of them. Among the senators vowing to vote against the legislation is Senator Tom Coburn of Oklahoma. Senator Coburn joins us tonight. Senator, great to have you with us.

SEN. TOM COBURN (R), OKLAHOMA: Good to be with you, Lou.

DOBBS: Let me just sort of share with everybody a couple of the things that are in there. Because we said, you know, the Republicans say, these are facts. In the kind of spending that you're talking about include the following here, if we can put this up for our viewers. $1.9 million water taxi service, Pleasure Beach, Connecticut. $1.8 million, swine odor and manure -- I love this one -- swine odor and manure management research, Ames, Iowa. It sort of implies they're going to get rid of swine odor, doesn't it?

COBURN: They've been working on it for 10 years. They hadn't done it yet.

DOBBS: $238,000, Polynesian Voyaging Society, Honolulu, Hawaii.

COBURN: You can get that mental picture in your mind in a little ancient canoe? We're going to pay for it.

DOBBS: I've got it. And this is the kind of nonsense -- there are 8,500 of these things stuck in that bill. I mean, that's crazy.

COBURN: It's $7.7 billion more importantly that we don't need to spend. Some of these may be good plans and good ideas, but the question comes -- the American people ask, what's our priority right now? Our priority ought to be putting people to work, solving our financial problems, fixing the housing crisis, and not doing things that make politicians look good that our grandkids are going to pay for.

DOBBS: I was talking to a teacher today on my radio show, and he had a great idea. He was explaining how he explains to his third- grade students as he teaches them, they wanted to know what a stimulus package was, and he started explaining it. And finally, got through the explanation, and he says what it means is that each of you has a credit card in which we've run up all sorts of debt before you even get a chance to use the credit card. Which I thought was pretty good.

COBURN: Well, it's actually counter to everything that this country stands for. You know, we became a great country because one generation would sacrifice for the next. One would work harder to create greater opportunity. And we're doing that just in reverse.

Don't lose sight of the fact that this bill is 8 percent above last year's level, when inflation was less than 3 percent, and we just increased the average agency under this bill by 80 percent with the stimulus bill.

DOBBS: This is...

COBURN: They're clueless. They are absolutely clueless when it comes to common sense, and they've refused to make long-term choices that might be difficult for them politically, but would be good for the country.

DOBBS: Congressman Steny Hoyer said that the president has no business or power to tell Congress to roll back earmarks. House Speaker Nancy Pelosi defended those earmarks as an appropriate function of Congress. He's the one who said there wouldn't be any earmarks. Where do we go from here? Is this just more political nonsense?

COBURN: It is nonsense. But remember all the claims you'll hear. I wasn't a big fan of President Bush's fiscal policies, but what you hear on the floor of the House and the Senate is how bad Bush was in terms of spending money.

DOBBS: Right.

COBURN: The problem is that President Obama, Bush, Clinton before them, can't spend a penny until we let them.

DOBBS: Right.

COBURN: And so it's us. And we refuse to be grown up and adult and consequently...

DOBBS: I can't...

COBURN: ... really damaging our country right now.

DOBBS: Well, I can't wait for that day of political maturity that you just suggested. Let's hope it arrives sooner.

COBURN: One other thing -- the president can veto this bill. And he ought to. And he'll send a message that would excite the American people.

DOBBS: You know, Senator, I'm just sure he's going to do exactly that. Aren't you?

COBURN: Well, I'll pray about it tonight, and hopefully we'll have some divine intervention.

DOBBS: You got it. Well, thank you very much, Senator Tom Coburn.

COBURN: Good to see you.

DOBBS: At the top of the hour, no bias, no bull, Campbell, what are you working on?

CAMPBELL BROWN, CNN ANCHOR: Hey there. The latest plans for the president's massive infusion to the cash to the banking system, now as you know, the leading senate republicans say it's time to let weak banks go bust. Big names like city bank. Take a no bias no bull look and if this is a way to boost confidence in our nation's banks. Ali Velshi will be here to walk us through it all.

DOBBS: A story about the legendary doll Barbie celebrating the 50th birthday today. Mattel introduced Barbie in 1929. Can you believe I'm talking to you about Barbie? Of course I am. Barbie is not only an icon in this country, but around the world. The company estimated 90 percent of American girls between the ages of 3 to 10 on a Barbie. In case you didn't know -- this is the part you didn't know and perhaps you didn't as well, Barbie was originally designed based on a German sex doll. Up next, the results of our poll. Stay with us anyway.

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DOBBS: Our poll results, 78 percent of you say the Obama administration and democratic leadership are working to effectively end law enforcement in this country. I keep voting on the LOU DOBBS TONIGHT poll. I'm usually in the majority poll but I seem to be a minority with the government. Anyone out there hear me? We hear you and we feel your pain. Believe me.

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