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Lou Dobbs Tonight

Bonus Bonanza; More Money for AIG; Ohio Fighting Back

Aired March 17, 2009 - 19:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

LOU DOBBS, HOST: Tonight the outrage over AIG bonuses escalating. New questions about the policies in the Obama administration and the conduct of lawmakers on Capitol Hill who failed to supervise AIG and change the law. We're going to find out how and why they did that.

Also tonight, good news on the economy, that's right. You heard it here first. Good news on our economy, housing construction surging. New evidence that this recession, as I said, could end this year and, as I've said repeatedly, there's no chance of a depression.

Tonight, what some are calling a vast left wing conspiracy to influence what you see and hear in the national media, how could it be? I'll be talking with the journalist who wrote a provocative article on the impact of liberal reporters, left wing writers and socialist academics. He's among my guests here tonight. Join us for all of that, all the day's news and much more, straight ahead right here.

ANNOUNCER: This is LOU DOBBS TONIGHT; news, debate and opinion for Tuesday, March 17th. Live from New York, Lou Dobbs.

DOBBS: Good evening, everybody.

Congressional Democrats tonight seething with anger over massive bonuses paid by AIG to its top executives, those Democrats are threatening to pass legislation that would tax those bonuses up to 100 percent. Some of the Democrats, of course, utterly failed to supervise AIG and relevant legislation when AIG was placing huge bets on the housing market. One reason for the failure perhaps lawmakers from both political parties receiving hundreds of thousands of dollars in campaign contributions from the insurance company.

Meanwhile, we know much more tonight about the $160 million in taxpayer funded bonuses at the center of this outrage. Seventy-three AIG executives each received more than $1 million in retention bonuses, including one executive who earned more than $6 million. The New York attorney general saying 11 of the executives have now left AIG despite receiving so-called retention bonuses. Dana Bash has our report from Capitol Hill.

(BEGIN VIDEOTAPE)

DANA BASH, CNN CONGRESSIONAL CORRESPONDENT (voice-over): Suddenly a mad scramble to strip AIG executives of their bonuses.

SEN. HARRY REID (D-NV), MAJORITY LEADER: Recipients of these bonuses will not be able to keep all their money.

BASH: Senate Democrats issuing AIG this warning.

SEN CHUCK SCHUMER (D), NEW YORK: If you don't return it on your own, we'll do it for you.

BASH: How would they do it? The leading Democratic idea to take away $165 million in AIG bonuses is an excise tax, both on the company and on the individuals who got the bonuses.

UNIDENTIFIED MALE: We will act, and we will take this money back and return it to its rightful owners, the American taxpayers. We will take this money back by taxing virtually all of it.

SEN. MAX BAUCUS (D), MONTANA: The basic question is what's the highest tax that we can impose on those bonuses that is sustainable in court?

BASH: Democratic leaders in the House aren't as hot on taxing companies. One idea there is to take AIG to court for giving bonuses with taxpayer money.

REP. BARNEY FRANK (D), FINANCIAL SERVICES CHMN.: I think we should be suing to get those bonuses back, not as the government that gave money to this private entity but as the owner saying you know what, you got bonuses that you didn't deserve. And we want them back on the merits.

BASH: As for Republicans, they're pounding away at Treasury Secretary Timothy Geithner for not blocking the bonuses before giving AIG billions.

SEN. MITCH MCCONNELL (R-KY), MINORITY LEADER: What I'd like to know first is how it happened when we had an extraordinary leverage, a mere two weeks ago, when we handed over $30 billion.

(END VIDEOTAPE)

BASH: But the reality is that Congress has had ample opportunity to do it themselves, to actually have prevented AIG potentially from getting these bonuses before it happened. In fact, Lou, get this. Just last month, the Senate actually passed a provision by Democrat Ron Wyden and Republican Olympia Snowe that would have basically done what the senators and the Democratic senators what they want to do right now, which would have been to tax the companies who give bonuses, actually tax those bonuses...

DOBBS: Right.

BASH: But that provision did not go through. It was actually dropped during backroom negotiations with the House and also the White House, Lou.

DOBBS: OK. You know, it was dropped. Who dropped it? Who killed it? BASH: That is the -- I don't know, what, $165 million question that we've been asking all day long, Lou. I mean we talked to the Democratic leader asking was it a mistake? What happened? Didn't get an answer and that's part of the issue. But there's another ripple here.

And that is that what was put in to deal with executive compensation and bonuses, that would just deal with anything that happened after February 11th, 2009, so essentially that gave AIG and a lot of other companies a pass.

DOBBS: But we know...

BASH: So the other thing we're looking at is why that was put in there, why that date was put in there, because the person in charge of that provision, Senator Chris Dodd, the banking chairman, he vehemently denies to CNN that he put that date in there. So that is another big mystery that we're trying to get a handle on.

DOBBS: So what we have is a Senate that we knew was not reading legislation. We have a leadership that's not admitting what happened or how. And the relevant committee chairmen don't know what is going on with the legislation under their agents. Is that correct?

BASH: That's pretty much what it is. But you know, I can tell you what they're telling us. And what they're telling us about what they know and don't know may not be what they really know and don't know.

DOBBS: When they start telling us -- when they start telling us the truth, we'll start spending some time listening. How about that? Dana thanks a lot. I appreciate it. Good reporting.

BASH: Thank you.

DOBBS: Some of the most outspoken critics of AIG are also the biggest recipients of campaign contributions from AIG last year. Imagine that. Banking Committee Chairman Senator Chris Dodd, as Dana Bash just reported, involved in that amendment. He denies that it was his amendment -- receiving, however, the most money from AIG, $103,000, in fact.

Dodd facing questions, serious questions about those cut price mortgages he received from financial -- Wide Financial (ph), another company at the center of our financial crisis. Also President Barack H. Obama when he was a U.S. senator receiving more than $100,000 from AIG last year as he ran for president.

By the way, his Republican opponent in the race, you remember him, Senator John McCain, he was next on the list -- he down the list. He received $60,000. AIG also putting up $36,000 for the purpose of supporting Senator Hillary Clinton, now secretary of state, of course.

And Finance Committee chairman -- you want to cover your bases if you're AIG -- Senator Max Baucus. He got just about $25,000. All of those political contributions raising suspicions that AIG was trying to strongly influence the policies of Washington's most powerful elected officials. Leaving the question, how did they do?

Well, one leading member of Congress, Senator Chuck Grassley, proposing extreme measures to deal with the AIG executives responsible for the firm's near collapse and collecting bonuses at the same time. Senator Grassley suggesting the executives might even consider committing suicide, a proposal that I like to call the Grassley penalty -- sounds pretty good. Listen to this.

(BEGIN VIDEO CLIP)

SEN. CHARLES GRASSLEY (R), IOWA: I would suggest the first thing that would make me feel a little bit better towards them, if they'd follow the Japanese example and come before the American people and take that deep bow and say I'm sorry and then either do one of two things, resign or go commit suicide. And in the case of the Japanese, they usually commit suicide before they make any apology.

(END VIDEO CLIP)

DOBBS: You got to admire Senator Grassley. A lot of people would use the expression hara-kiri. He was talking about what -- I guess he meant at the time, but later the senator clarified his remarks saying he did not mean to suggest that AIG executives should kill themselves. The senator said he is simply demanding more statements of remorse and contrition from executives at the center of this scandal -- the Grassley penalty.

The president's top economic adviser Lawrence Summers today raising the possibility the government could give even more taxpayer money to AIG. I guess because it's worked out so well so far. That of course would be on top of the $170 billion that AIG has been given already. Summers telling CNN's Ed Henry quote, "We can't let anger stop us from taking the steps that are necessary to maintain the stability of the financial system" -- my, my.

Ed Henry joins me now. Ed, this is getting cuter and cuter. What in the world are this White House and Larry Summers thinking about now?

ED HENRY, CNN WHITE HOUSE CORRESPONDENT: Well, Lou, for the second straight day President Obama tried to talk up his economic agenda, tried to say that the big challenges facing the nation cannot be ignored, but ignored they were as his top aides were faced with all kinds of questions. Robert Gibbs, the spokesman, as well as other senior aides from reporters about the AIG bonuses and all this bubbling outrage and all of that and when I spoke to Larry Summers, he said look, we're outraged too.

We're upset about the way AIG ran its company into the ground, what they've done to the entire financial system, but he said we're outraged as well about it. And as you heard in Dana's piece, some Republicans like Mitch McConnell are saying, wait a second, this may be false outrage, why didn't they speak up the two weeks ago when the White House had a chance, they had some leverage, as they were about to give more taxpayer money to AIG, why didn't they attach some strings? I pressed Larry Summers on that question. And he basically said look, if Treasury Secretary Geithner pushed too hard, AIG may have collapsed just like Lehman Brothers and we would have an even bigger meltdown. Take a listen to how he put it.

(BEGIN VIDEO CLIP)

LAWRENCE SUMMERS, NATIONAL ECONOMIC COUNCIL CHMN.: What he did not do and what would have been irresponsible to do, as outrageous as these payments are, would have been to put at risk the stability of the financial system. To have courted the kind of disaster that followed the decision to let Lehman Brothers simply collapse might have felt good briefly, but it would have touched the lives of the huge number of Americans who would unnecessarily have become unemployed or seen destruction of their lifetime savings.

(END VIDEO CLIP)

HENRY: So as you noted, I also asked Larry Summers what if AIG comes back to the White House, comes back to the Treasury Department and says down the road we want more taxpayer bailout funds. Larry Summers said basically we can't govern out of anger. As angry as this White House and others are, if they need to help prop up AIG, if that's what it's going to take to keep the financial system on its feet, that they may have to do that. So it certainly sounds like the door is open to more taxpayer funds down the road if AIG asks for it and obviously that may cause even more anger out there, Lou.

DOBBS: I have to say, I'm shocked that Larry Summers would indulge in such, such a lack of intellectual forthrightness. To compare Lehman Brothers and AIG, Lehman Brothers never receiving the support of the Republican administration six months ago, and AIG from the outset receiving the support of the Republican administration, it has taken money and money and money and money throughout. And to suggest that to constrain those taxpayer funds at some point would be the same as Lehman Brother, I can't even imagine how you could compare those two situations, Ed.

HENRY: I think what he was trying to suggest was that, as you'll remember, after Lehman Brothers did go down -- and you're absolutely right, there are some key differences between these two companies. But after Lehman Brothers did not get any help and collapsed, there are many in both parties who believe that led to a spiraling of this financial crisis.

But I think obviously the idea that AIG may get even more money points up what a lot of critics said at the very beginning of all this last fall, which that once you started giving some of these companies some bailout money, they'd be so addicted to it that when will it end? When will it stop?

DOBBS: Yeah...

HENRY: And we've heard again and again, they're too big to fail, we've got to prop them up and... DOBBS: Let me say that the second part of this is the suggestion that AIG would have failed because the -- Timothy Geithner, the treasury secretary, had imposed some serious restrictions on their executives' bonuses is just simply nonsense. Let me be very clear and you can pass that along to the president's economic adviser, and it's the kind of nonsense we really don't need to hear from a White House spokesman, whether it be this administration or the last. We've had enough pabulum spewed by Hank Paulson, the previous treasury secretary, really would like to hear an end to that. Ed, thank you very much -- Ed Henry.

HENRY: Thanks, Lou.

DOBBS: President Obama's expected to speak at a St. Patrick's Day event that's being held at the White House, by the way, this hour. We'll be bringing that to you live here just as soon as it begins -- a lot of green at the White House.

Also ahead, some unexpected good news on the economy and the housing market and take that, you naysayers, you negative nay-bombs. We'll tell you all about it as the recovery takes hold.

And we'll have a special report on one state showing the entire nation how to fight back against this recession. Spit it in the eye. Get moving. We'll be right back.

(COMMERCIAL BREAK)

DOBBS: Unemployment 8.1 percent across the country, but it's even higher in Ohio. Ohio lost more than 90,000 manufacturing jobs over the past year, 34,000 manufacturing jobs cut in January alone. Ohio is trying to reinvent itself, however, from a rust belt relic to a state supporting new industry, creating new jobs in a new century -- Bill Tucker with our report from Lorain, Ohio.

(BEGIN VIDEOTAPE)

BILL TUCKER, CNN CORRESPONDENT (voice-over): HPM has been in Mount Gilead, Ohio, since 1877. Once it made apple pressing machines. Until about three years ago its primary business was selling parts and machines to the auto business. Today most of HPM's business is making parts for wind turbines.

UNIDENTIFIED MALE: It offers a steady growth potential for companies such as ours to supply components. If we did not find wind turbine business, we'd be in very difficult financial situations.

TUCKER: HPM was ahead of the curve of many manufacturers. It has only been in the last year or so that other companies which supply the auto industry have begun to recognize the opportunities in the wind turbine industry. But in many cases, it's a grudging recognition. It seems many would rather stick with the devil they know than the one they don't.

ROB DUMONT, TOOLING, MFG. & TECHNOLOGIES ASSN.: There is a real reticence on the part of many of our members to move away from the automotive industry and get into other areas. They recognize I believe that it is a -- it's not only a learning curve but it's a production curve as well.

TUCKER: The state has targeted alternative energy as the number one industry for transforming its workforce. HPM helped by the state, partners with a technical college to train the workers it needs. And over the past two years, Ohio has been very aggressive about funding economic development projects of all types.

According to state officials, those projects have created more than 53,000 jobs and saved another 200,000 jobs. Ohio is the only state that's increased exports every year for the past decade. Still, Ohio has lost more than 200,000 jobs in the past year and its unemployment rate is 8.8 percent.

LT. GOV. LEE FISHER (D), OHIO: The short run is not pretty. It is not rosy. Things will probably in our economy get worse before they get better. But we need to be optimistic, we need to be confident, and we need to be determined to make the short-term and long-term investments that will make Ohio more competitive.

TUCKER: Ohio, like other states, is facing financial challenges with its budget.

(END VIDEOTAPE)

TUCKER: And Lou, Ohio is kind of unique in that it is running contrary to the national trend. This is a state which is taking steps to trim its payroll, to bring its budget in line. There are 3,000 fewer employees working for the state today than there were two years ago. But Lou, in a lot of ways, there's probably no better picture of the challenge this state and this economy faces than this parking lot behind me where there are thousands of unsold Hondas sitting on the parking lot of a Ford plant, which has been shut down. Lou?

DOBBS: It gets complicated these days, doesn't it? Bill, thank you very much.

TUCKER: It does. It does indeed.

DOBBS: Bill Tucker reporting from Lorain, Ohio. Joining me now to sort out some of the complexities is the man who has to do that every day for the people of Ohio. We're joined now by the governor of Ohio, Governor Ted Strickland. Good to have you with us.

GOV. TED STRICKLAND (D), OHIO: It's good to be with you, Lou.

DOBBS: 8.8 percent unemployment. You've got some very serious challenges, as compared to other states across the union, some with more challenges. But you're here to talk about new green initiatives trying to position the state and the industry in your state for the future. How is that going, and what do you expect the future to look like?

STRICKLAND: Well, I think there's a great promise for Ohio in alternative energy, renewable energy, advanced technologies. I'm here in New York today speaking to about 200 firms from Spain; two of those firms are very interested in investing hugely in Ohio. One wants to build a wind farm out in Lake Erie.

DOBBS: Right.

STRICKLAND: And we're very excited about that.

DOBBS: Out in the lake?

STRICKLAND: Out in the lake -- out in the lake and Lake Erie freezes, so this would be perhaps the first time a large wind farm had actually been constructed on water that freezes.

DOBBS: I have three reactions just very quickly as you say that, Governor. One is you're talking to companies from Spain. Why in the world can't we find American initiatives and capital? Secondly, you're building it out in the middle of Lake Erie, that's innovative. But my God where -- you think you might hear from an environmentalist or two (INAUDIBLE).

STRICKLAND: We're dealing with that, Lou, and we're determined to. This is Ohio's future. Solar energy is big in Ohio. It's growing. We've got some wonderful start-up companies in the northwestern part of Ohio in the Toledo area. And we think solar power and wind power, bio fuels, clean coal technologies, even nuclear power, all of these things have a future in Ohio.

DOBBS: And you're optimistic, obviously, or you wouldn't be governor of the state.

STRICKLAND: Yeah.

DOBBS: But the challenges you face are significant. I was just looking down here at the numbers. Job declines just in January, 22,000 lost in the services sector; the financial sector 6,800; the government you lost 4,800 jobs in government. You must be the only state in the union where the public sector is paying attention to what's happening in the private sector and professional and business services. Are you going to see those numbers -- that trend reverse itself?

(CROSSTALK)

STRICKLAND: Well they must -- they must reverse. Lou, we can't -- I'm not going to give up on Ohio. We can't give up on this country. And that means we've got to work every day in a focused way to turn this economy around. In Ohio we're trying to do it by focusing on the things that are most growthful to our state and that's energy certainly.

The health care industry is a growing industry in Ohio. A lot of research is going on. Biomedical research is going on. But we are focusing on education. Even in the midst of this recession, we're holding the line on college tuition. We froze college tuition for four years at most of our institutions.

DOBBS: Good.

STRICKLAND: We're putting more money, even in the middle of this recession, into elementary and secondary education.

DOBBS: Are you keeping kids in school, in high school, public education...

STRICKLAND: Absolutely. That's exactly what we're trying to do. And we're working at it. Listen, every day I get up and I think about education and what we're going to do in Ohio to make sure that we educate our kids and we make college affordable for our young people. That's the only hope for our future, but it is a good future in Ohio. And I invite people watching this show to come to Ohio. We'll treat them well, we'll welcome them, and we'll make them a part of the Ohio family.

DOBBS: You got to -- well we've got -- our executive producer, Jim McGinnis (ph), is from Ohio, as he constantly reminds us.

STRICKLAND: And I'm trying to get him to come back.

DOBBS: You got it. Well Governor Strickland, it is great talking with you. I wish you all the best. Many challenges but you've got yourself straight ahead at it, so that's good and good for the people of Ohio.

STRICKLAND: Thank you, Lou.

DOBBS: Wish you...

STRICKLAND: Thanks for having me.

DOBBS: Thank you. Appreciate it, Governor.

STRICKLAND: Thank you.

DOBBS: Up next, rising outrage over those AIG bonuses. Who's to blame? Well a lot of people don't want to be honest about this, but we're going to point toward the Obama administration and all of those fun folks on Capitol Hill. We'll whisper it so nobody's offended, though.

And I'll be joined by three of the country's best radio talk show hosts here next and finally some good news on the economy. We'll have it. Several times even in this hour. We'll be right back.

(COMMERCIAL BREAK)

DOBBS: Good news on the economy. Did I -- did I say that? Good news on the economy, a new indication that this recession will likely end this year, new home building surging by more than 20 percent last month. That is the first increase since June of last year.

And meanwhile, a small increase in wholesale prices, those prices suggesting that there is strengthening demand for products and factories and what refineries charge for their products and a further indication that the risk of deflation may be easing, stocks rallying on that news. The Dow Jones industrials gaining almost 180 points; the Dow Jones industrials closing at 7395; stocks have soared 13 percent over the past week alone.

Housing may be showing signs of improvement, but some companies still cutting jobs. Caterpillar today said more than 2,400 of its employees in Illinois, Indiana and Georgia will be losing their jobs. It was just last month that President Obama told laid off workers at Caterpillar that the stimulus money would help the company rehire workers. You remember that.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: And I'm not the only one who thinks so. Yesterday Jim, the head of Caterpillar, said that if Congress passes our plan, this company will be able to rehire some of the folks who were just laid off. And that's a story I'm confident will be repeated at companies across the country.

(END VIDEO CLIP)

DOBBS: The president got a little ahead of himself. Shortly after he spoke at that very same event, Caterpillar's CEO Jim Owens who's also an adviser to the president on the economy, flatly contradicted President Obama, and made it very clear that it would be more likely that they moved in a different direction.

(BEGIN VIDEO CLIP)

JIM OWENS, CEO, CATERPILLAR: The reality is we'll probably have to have more layoffs before we start hiring again. But I think it's going to take a while before the stimulus package kicks in.

(END VIDEO CLIP)

DOBBS: Apparently the stimulus package hasn't kicked in yet for Caterpillar. Those 2,400 layoffs that the -- that the -- excuse me -- the company announced are on top of the 20,000 jobs the company said it would cut this year.

Well, let's take a look now at some of your thoughts. Joyce in Arizona said, "Lou, can you tell me where to go to apply for a job with AIG? They have the kind of bonus structure I'm looking for."

And Maya or Maya in Idaho, "Hey Lou, I'm writing a check for my taxes this week. Which AIG executive should I make it out to?"

And we always love hearing from you. Send us your thoughts to loudobbs.com.

Up next here, President Obama finally doing something sort of to tackle the escalating drug cartel violence along our border with Mexico. And the outrage over AIG bonuses could make it harder for the president to push his agenda through Congress. I'll be joined by three of the country's top radio talk show hosts here next.

(COMMERCIAL BREAK)

DOBBS: Joining me now three of my favorite radio talk show hosts. From KCMO Kansas City, Chris Stigall. How are you?

CHRIS STIGALL, KCMO IN KANSAS CITY: Lou, feeling good. Happy St. Pat's.

DOBBS: And to you. In Washington, D.C. from WHFS and WPGC, Guy Lambert. Good to have you with us, Guy.

GUY LAMBERT, WHFC: Thanks for having me.

DOBBS: In New York City from WABC Radio, what's that name? Mark Simone.

MARK SIMONE, WABC RADIO: Great to be back.

DOBBS: Let me just say, we're watching something sort of amazing in these AIG bonuses. There's a mystery tonight as to what happened with the snow amendment that would have constrained this sort of thing in the stimulus package. It's curious how the Dodd amendment was added which he now denies he did. It seems like no one knows what's happening with trillion of dollars, Mark, in stimulus packages or how bonuses get permitted.

SIMONE: First of all, all these guys, republicans, democrats, white house, they knew about these bonuses. We always have these bonuses.

DOBBS: It's a Wall Street deal.

SIMONE: It's a Wall Street deal. Let's go back to Eliot Spitzer who chased Hank Greenberg out of AIG years ago. Had he stayed maybe we wouldn't have had this meltdown. He was a pretty good CEO. Also they're going to tax to death these guys to get their bonus back even though it's the London office and most are British citizens. I don't know how you tax them.

DOBBS: I'm not sure how you -- with the constitution like ours I know it's honored more the breach these days. But Guy, isn't it kind of unconstitutional to tax retroactively?

LAMBERT: Hey, Lou, plain and simple, when you buy a house, you sit down and you look at the paperwork before you sign it, don't you? You would think -- thought rather that Chris Dodd would have pretty much done the same thing. Listen, this thing is really getting out of hands. You have moms and dads that wake up every morning, feed their kids, send them to school, hop in the car, spend an hour getting to work, get home to learn that, wow, my hard earned tax dollars have been spent by the -- or rather bonuses have been given to these top executive. People are outraged to say the least.

DOBBS: How do you think they feel, those folks you're talking about, guy, when you've got Chris Dodd and Harry Reid, all of them scratching their heads saying, well, I don't know how that happened? What do you think, Chris? STIGALL: Well, look, that's just it. It's kind of like follow the -- we're all supposed to be a bunch of cats and they've got the ball of yarn and we're supposed to look where they shake it. We're a little too smart for them. We know that they're the folks that have known about these bonuses for a long time. "The New York Times" is reporting it, politico is reporting it, you're reporting it. The jig is up. They knew about the bonuses. Time to stop pummeling AIG and put them accountable for.

SIMONE: Out of $180 billion bailout, 165 million is like 35 cents. And we're hearing from guys that, men and women who threw away a trillion dollars on stimulus. You talk about waste. Let's take a look at them, too.

DOBBS: I think you're exactly right. But at the same time, I just want to put up one thing, if we've got this, a full screen that shows how these political contributions went. And if there's some confusion about why people can't figure out who wrote what and who took what out of the stimulus package, could we put that full screen up on the political contributions? Well, there's Dodd. $103,000. I guess we're going to do this one at a time. And then here's number two, Barack Obama. We're going to stop with Barack Obama because we'll all get worn out.

SIMONE: It is a hell of a coincidence.

DOBBS: It is. And number one and two, we're going to be back to find out what all that money buys. We'll see if it's a successful investment and maybe the best investment that's been made by anybody here in the last year or so. We'll be right back with our panel in a moment.

But first our poll question, do you believe we should immediately dispense with the too big to fail policy? We'd like to hear from you. Yes or no. Cast your vote at loudobbs.com.

(COMMERCIAL BREAK)

DOBBS: We're back with our panel right now, Chris Stigall, Guy Lambert, Mike Simone.

It seems to me that history could have been changed if one fellow by the name of John McCain back at the end of September when he said he was going to suspend his campaign, come back and exert leadership. If he'd stood up against this T.A.R.P., the Wall Street bailout, think about how history could have been changed. What do you think?

LAMBERT: Lou, once again, it's a case of what if. What if John McCain did do that? The fact of the matter is that we are where we are today. We need to address the issue where we are today and move forward. As folks always say, you know, it could have been a case of what if. And I think that's where we're at right now. What if, Lou?

DOBBS: Go ahead.

STIGALL: Well, Lou, the only thing is that moment in time, in history set in motion the standard we find ourselves in today. That was the moment John McCain could have made his mark and said, just based on this pork stance alone, remember, despite it being a disastrous bill, it was loaded with pork. It was full of earmarks. That was a campaign promise he said he'd vote against and he didn't.

DOBBS: They add $150 billion in pork to get it through. This time they didn't need extra. They built the pork right in.

SIMONE: Why do you have to spend all $1 trillion in one bill? Why couldn't you try $100, see how that works?

DOBBS: The incremental thing kind of worked because they had $787 billion in the stimulus package this time then they added $410 billion in omnibus spending. So the numbers are starting to add up.

STIGALL: And it was all urgent, Lou. It was a panic, urgent, a panic. Now look at us all.

SIMONE: We had a 1,000 point rise in the stock market, housing starts are up.

DOBBS: Just hold the money. Hold the money. Because it looks like the recovery is on the way.

By the way, good news on the economy. Good news on the market. You know, we're now, since President Obama took office, we're only down about 7 percent. So things are improving for him and investors on Wall Street, hallelujah. Thank you, gentlemen, we appreciate you being with us.

Up next, the national liberal media's push to influence what you read, see and hear. It is a conspiracy that journalists Michael Calderon, he wrote an article on the issue, he reveals it. We'll share with you all the sinister undertones. New efforts to keep Mexico's drug wars from escalating. We'll be focusing on that next here.

(COMMERCIAL BREAK)

DOBBS: And this just in to CNN, new details tonight on the Obama administration's apparent plan to send reinforcements to our border with Mexico. More than 127 federal agents will be reassigned to the border. The Associated Press is reporting that those agents will come from Immigration and Customs Enforcement and Alcohol, Tobacco, Firearms. But critics say it look like a token gesture with thousands dead at the hands of the drug cartels in Mexico and with those cartels distributing their elicit drugs across 230 cities in the United States.

This just in to CNN, the president apparently deciding to move over 100 agents to the border, bringing them from Immigrations and Customs Enforcement and Alcohol, Tobacco And Firearms.

The United States senate also struggling to find ways to try to halt the deadly cartel violence. Senators today hearing from those on the front lines of the border drug wars. But the hearing turned into a battle, a political battle over our constitutional rights. Two leading senators fighting over curtailing our second amendment rights to bear arms to appease the Mexican government. Casey Wian has our report.

(BEGIN VIDEOTAPE)

CASEY WIAN, CNN CORRESPONDENT: Arizona Attorney General Terry Goddard warned a senate committee that Mexican drug cartel violence is spreading to the United States.

TERRY GODDARD, ARIZONA ATTORNEY GENERAL: I'm very concerned both at the possibility of innocent victims getting caught in the crossfire, if you will.

WIAN: Across the border from El Paso in Ciudad Juarez Monday, a Mexican general took over as police chief. His predecessor resigned.

SEN. ARLEN SPECTOR (R), PENNSYLVANIA: When you have a police chief in Juarez who was forced out of office because they're killing his deputies, how much closer can you come to the total breakdown of law and order?

WIAN: U.S. law enforcement officials praised Mexican President Felipe Calderon for engaging the cartels.

ANTHONY PLACIDIO, DRUG ENFORCEMENT ADMIN.: I believe this government is making progress and that the violence we see is actually a signpost of success.

DOBBS: They also praised the initiative that will transfer hundreds of millions in U.S. military equipment to Mexico. One senator was skeptical.

SEN. DIANNE FEINSTEIN (D), CALIFORNIA: We contacted the state department and have been told that the helicopters and surveillance aircraft will not be available till 2011.

DOBBS: Alabama Republican Jeff Sessions advocated expanded law enforcement. He had a heated exchange with Dick Durbin of Illinois who echoed the Obama administration's position that the United States must do more to curb gun trafficking.

SEN. RICHARD DURBIN (D), ILLINOIS: Guns are a serious problem. The fact that thousands of guns are flowing there is arming these gun cartels.

SEN. JEFF SESSIONS (R), ALABAMA: We have the constitutional right in America to keep and bear arms. We're not changing our constitution.

DURBIN: I would just say --

SESSIONS: I just would say that people being killed at such an extraordinary rate across the border in Mexico so much hundreds of times higher than in the United States where we have guns, too. DURBIN: I recognize the right of American citizens to defend themselves, to use guns legally for sporting and hunting. We have a responsibility and to ignore it by saying well, if we weren't irresponsible, somebody else would be irresponsible is cold comfort to people living in a country where 6,000 innocent people were killed last year mainly because of American firearms and the insatiable American appetite for drugs.

SESSIONS: I don't think it's all our fault.

DURBIN: I never said it was.

(END VIDEOTAPE)

WIAN: To clarify a couple of things Senator Durbin did say, first, that 6,000 innocent people were killed in the cartel wars last year. Well, there clearly have been innocent victims. The Mexican government says more than 90 percent of those killed were involved in the drug trade. Durbin and other senators also claimed thousands of guns crossed the border into Mexico from the United States every day. An I.C.E. official testifying at the hearing said the real number, Lou, is in the hundreds, not the thousands.

DOBBS: Yeah, I'd like to see the audit on all of that nonsense. Durbin, with all due respect to the senator, to suggest that the reason for the violence, as he put it, American firearms, is he aware of the five principal drug cartels at war with each other, the outright law of those. What in the world is a chairman of a committee doing speaking so irresponsibly? That's absolutely -- I find it astonishing. Where do we go from here with that committee?

WIAN: Well, he seems to be echoing the statements of the Obama administration. Eric Holder said that, you know, he wanted to resume the assault weapons ban, to help Mexico allegedly help Mexico or theoretically help Mexico curtail this drug cartel violence. As many other senators on that committee today pointed out, if some of those guns weren't coming from the United States, Mexican drug cartels would get them from either the Mexican army or from other nations, Lou.

DOBBS: I don't know if Senator Durbin has ever been to northern Mexico, but I'd sure like to go there with him. I'd like to show him around. And, you know what else I'd like to do? I just like to suggest, perhaps, to the senator that he think about this, that his -- his affinity with the Obama administration and the efforts of the president and the attorney general Eric Holder, to try to roll back our second amendment rights, will be, by the fiercest, I guarantee you, the most substantive resistance in the history of -- of politics in this, in this century so far at least. I mean it is just disgusting to hear that. I had been calling for secure borders here since September 11th. I have been calling for secure ports since September 11th. And now, this man, Senator Durbin has the effrontery, talking about securing the borders and winning the war on drugs because he finds it convenient to the interest of the president of Mexico. There may be a conflated interest shared. I have to say it is astonishing the man has no sense of context and what he is saying. WIAN: You mention border security, the governments have fallen short in the border security efforts. And a lot of drug trafficking and arms trafficking would be taken care of if there was border security between the U.S. and Mexico.

DOBBS: Wouldn't it be nice if there is enough interest in securing our borders so that we could stop the devastation, literally, of millions of young lives in this country because we haven't seen fit to fight the war on drugs. Casey, thank you very much. Casey Wian reporting.

I want to make a correction to something I said last week. I made a mistake talking with correspondent Lisa Sylvester after her report on President Obama's unveiling the education initiative in front of the U.S. Hispanic chamber of commerce. In my conversation with Lisa, I said the Hispanic chamber of commerce is interested in the export of American capital and American production to Mexico and Mexico's export of drugs and illegal aliens into the U.S. I believe any opens borders policy does facilitate not only illegal immigration but also the trafficking of massive amounts of illicit drugs. I of course do not believe that the chamber support or condones either drug or human trafficking. My apologies to the U.S. chamber of commerce, the U.S. Hispanic chamber of commerce. And I hope that they will forgive me for that misspeaking.

Up next, new evidence of the liberal agenda in the media. The author of a provocative new article and politico.com will tell you about something that could well be a conspiracy. We'll be right back.

(COMMERCIAL BREAK)

DOBBS: Politico.com, reporting on a blog that counts many left leaning reporters as members and folks, operates in secrecy where journalists who should be competing for one another instead are apparently sharing story ideas and information. Michael Calderone, media reporter for politico.com joins us. Good to have you with us.

MICHAEL CALDERONE, POLITICO.COM: Good to be here.

DOBBS: You are the first to write about the group of characters. I think most folks even in the blogosphere, used to traditional media, would expect some of the best known journalists in the country along with other politicos, if I may, would be working independently and certainly not working together but rather as competitors.

CALDERONE: Sure, what most of the members on the list I have spoken to say they're not crafting ideas or following any sort of talking points but more so putting it, ideas whether, you know I'm a writing a piece on health care, or I'm looking into the Israeli- Palestinian situation. By doing that then they're getting a lot of input from other people on this list. What some other folks, you know, see is maybe there is something to this. Because it is all kept private. Completely off the record. And so to outsiders they think there could be something sinister going on.

DOBBS: Yeah, it does, particularly -- and in this day and age where there is so much, well campaign-like activities going on, in this administration right now, and concerted efforts to attack certain public figures whether in the media or otherwise, we haven't seen a lot of that before. We are seeing it certainly now. There are also reporters, politico, including Mike Allen, Ben Smith, you have also got folks I should mention like Jeffrey Toobin, Paul Krugman, and Jeffrey Toobin from CNN. I love the way you close the piece with Joe Klein talking about how he thinks he said all he should see at this point. That had a nice ominous ring to it.

CALDERONE: Well, with Joe Klein like a lot of other people say these types of lists -- he acknowledged he is on other listserves, are helpful for him in his work. I should say there are lists on the right. There are lists on the left. Lists for specific areas that people are interested in whether social security or health care. Why we profile this particular one it seemed to be much more comprehensive. Several hundred members. Kind of swept across a lot of left-of-center magazines, you know, straight, mainstream reporters. As well as academics, policy people. So it seemed to cover a broad swath especially in the Washington, D.C., and New York circles.

DOBBS: Michael Calderon is reporting on the facts here. I don't mean -- the inference, what I guess I am saying, my inference, that there is some kind of, well, unusual cooperative activity amongst journalists. That's my conclusion. It isn't certainly his assertion, fair to say, isn't it not, Michael?

CALDERONE: Very fair. People share your position. I am putting it out there. People can decide if they think it is skull and bones type thing or journalists helping each out in a private setting.

DOBBS: I think it is a bunch of left wing, liberals getting together -- no, just kidding. I'm not sure what it is. It is unusual. I would expect competition rather than cooperation because it gives it if you will a certain ideological cast. Michael Calderon, great reporting great to have you with us.

CALDERONE: Great to be here. Appreciate it.

DOBBS: Our poll results tonight. 95 percent of you say we should immediately dispense with the "too big to fail" policy.

And a few more of your thoughts.

James in Arizona said, "Lou how about retaliating against Mexico by sealing our borders?" That might be very helpful indeed.

And Linda in Georgia, "People say that unless the bonuses are paid to AIG executives, they will move on to better jobs. If they were anything to begin with, AIG wouldn't have needed a government bailout. Let them go with the taxpayers' blessing." I concur with you again. I love the audience of this broadcast. Very wise indeed. Send us your thoughts to loudobbs.com. Join me on the radio Monday through Friday for the "Lou Dobbs Show."

That's it for tonight. Thank you for being with us.

Campbell Brown, "NO BIAS, NO BULL," starts right now. Campbell.