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LOU DOBBS TONIGHT

Terror Arrests; Homeland Security; No Boundaries; Sanders and Paul Discussion

Aired June 9, 2005 - 18:00   ET

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

LOU DOBBS, CNN ANCHOR: Good evening, everybody. Tonight, an astonishing proposal to expand our borders to incorporate Mexico and Canada and simultaneously further diminish U.S. sovereignty. Have our political elites gone mad? We'll have a special report.
Border violence raging in Mexico. Assassins murder a Mexican police chief in cold blood. Yet, incredibly, the Mexican government declares U.S. warnings about border violence unnecessary.

And massive population growth in our western states is straining already short water supplies. Twenty-six western states are in the grip of the worst drought ever. We'll have that report.

Our top story tonight, the widening investigation into an alleged radical Islamist terrorist plot in California. Federal agents arrested a fifth suspect today. The FBI says that there could be even more arrests.

But prosecutors have backed away from earlier assertions that those suspects were planning specific attacks on hospitals and supermarkets. Those officials now say the suspects were planning to carry out terrorist attacks in the United States and to kill Americans.

Chris Lawrence reports from Lodi, California, the center of the FBI investigation -- Chris.

CHRIS LAWRENCE, CNN CORRESPONDENT: Lou, right now, investigators are examining the evidence that was seized during FBI raids of a local mosque and two private homes. Two of the five men have been arrested for lying to FBI agents.

Now, authorities say this man, Umer Hayat, a local ice cream truck driver, and his son Hamid had first denied and then admitted that Hamid attended a terrorist training camp in Pakistan and then asked to come back to the U.S. to carry out his mission.

(BEGIN VIDEO CLIP)

MCGREGOR SCOTT, U.S. ATTORNEY: He also confirmed that the camp was run by al Qaeda operatives and that they were being trained on how to kill Americans.

(END VIDEO CLIP)

LAWRENCE: U.S. attorney McGregor Scott says there will be zero tolerance for hate crimes or retaliation. The mayor of Lodi spent about two hours today meeting with the Muslim community.

That's important, because the other men detained are two imams, or Muslim spiritual leaders, and one of their sons. The people in the neighborhood have very different reactions to these accusations, from a neighbor who knows Umer Hayat to another man who talked about his relations with his Muslim neighbors.

(BEGIN VIDEO CLIP)

BRIAN RUX, NEIGHBOR: I've always heard it's been pretty good. You know, no problems. But I've always speculated that day of 9/11, and then this has confirmed it, that there has been terrorists or those kind of people in this town the whole time.

(END VIDEO CLIP)

(BEGIN VIDEO CLIP)

LES KOLB, NEIGHBOR: He's always been cordial -- to me, anyhow. He'd say "Hi" when you'd see him in the morning. He introduced to himself to me, and he called himself Michael.

So he was Mike to me. And he would say, "Hi, Les, how you doing?" And I would say. "Hi, Mike, how you doing?" And we talked about whether the ice cream business any good this year.

(END VIDEO CLIP)

LAWRENCE: Well, right now, Umer Hayat has bigger worries, although his attorney reminds us that right now he's only charged with making a false statement. His son, Hamid, will be in court tomorrow for a bail hearing -- Lou.

DOBBS: Chris Lawrence from Lodi, California. Thank you.

President Bush, seeking to extend and expand the Patriot Act, today emphasized the role of the Patriot Act in the arrest and conviction of more than 200 terrorists. In a speech in Columbus, Ohio, President Bush pushed Congress to renew some of the aspects of the legislation that have drawn the sharpest criticism from civil liberties activists.

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: At the end of this year, 16 critical provisions of the Patriot Act are scheduled to expire. Some people call these sunset provisions. That's a good name, because letting that -- those provisions expire, would leave law enforcement in the dark.

(END VIDEO CLIP)

DOBBS: Those 16 provisions include so-called library provisions, allowing the government to search certain business records and another that allows the FBI to tap multiple phones used by the same person. The American Civil Liberties Union is critical of those powers, saying, "Americans have a reasonable expectation that their federal government will not gather records about their health, their wealth and the transactions of their daily life without probable cause of a crime and without a court order."

However, we asked the ACLU for their position on the risk associated with shipping the very same financial and medical records overseas when companies outsource to cheap foreign labor markets and when companies lose confidential records. An attorney for the ACLU said, "While outsourcing is not a civil liberties issue, when you ship information overseas, we lose the control of what happens to it and the security is lost."

A major setback today on the global war against radical Islamist terrorism. A German appellate court upheld the acquittal of a key suspect in the September 11 attacks. The German appellate court turned down an appeal by prosecutors who said the acquittal of Abdelghani Mzoudi was flawed.

Prosecutors say Mzoudi provided logistical support for the September 11 hijackers and terrorists. In today's ruling, German authorities declared Mzoudi will be deported to Morocco unless he leaves Germany voluntarily.

There are rising fears in this country that terrorists may try to destroy critical oil and natural gas facilities. One leading terrorism expert says those facilities are easy targets for terrorists. Those fears tonight are being cited by opponents of a new liquefied natural gas plant in New England.

Karen Schaler reports.

(BEGIN VIDEOTAPE)

KAREN SCHALER, CNN CORRESPONDENT (voice-over): About 50 miles from Boston, residents of Fall River, Massachusetts, are fighting to keep a proposed liquefied natural gas, or LNG facility, out of their community. Key concerns? The environmental impact and the potential of the facility becoming a terrorist target.

RICHARD CLARKE, FMR. COUNTERTERRORISM CHIEF: The words of bin Laden, attack the American infrastructure, attack the American economy. The words of bin Laden, attack oil and natural gas facilities.

SCHALER: The LNG import terminal would be built in a populated area with narrow waterways that would need extensive dredging, allowing giant super tankers to transport millions of gallons of volatile LNG to the docking site.

MAYOR EDWARD LAMBERT, FALL RIVER, MASSACHUSETTS: We are vehemently opposed to having a project that jeopardizes our lives and our livelihoods rammed down our throats for the benefit of industry profits when safer alternatives are available.

SCHALER: The Federal Energy Regulatory Commission is considering 16 proposed LNG sites across the country, including Fall River. Federal Reserve Chairman Alan Greenspan supports increasing LNG in the U.S. to improve energy efficiency.

ALAN GREENSPAN, FEDERAL RESERVE CHAIRMAN: Increasing availability of LNG around the world should lead to much greater flexibility and efficiency in the allocation of energy resources.

SCHALER: Yet, images like this, showing the aftermath of a deadly LNG explosion in Kenya, and this LNG disaster in Algeria, have many civic leaders in this country fighting to keep these facilities out of their communities.

(on camera): The mayor of Fall River has made the trip here to Washington to file a request with the Federal Energy Regulatory Commission asking for a special hearing. The commission says so far it has not made any final decisions, and even if the project is given the green light, state officials still have final veto power.

Karen Schaler, for CNN, Washington.

(END VIDEOTAPE)

DOBBS: Border security is arguably the critical issue in this country's fight against radical Islamist terrorism. But our borders remain porous. So porous that three million illegal aliens entered this country last year, nearly all of them from Mexico.

Now, incredibly, a panel sponsored by the Council on Foreign Relations wants the United States to focus not on the defense of our own borders, but rather create what effectively would be a common border that includes Mexico and Canada.

Christine Romans has the report.

(BEGIN VIDEOTAPE)

CHRISTINE ROMANS, CNN CORRESPONDENT (voice-over): On Capitol Hill, testimony calling for Americans to start thinking like citizens of North America and treat the U.S., Mexico and Canada like one big country.

ROBERT PASTOR, IND. TASK FORCE ON NORTH AMERICA: The best way to secure the United States today is not at our two borders with Mexico and Canada, but at the borders of North America as a whole.

ROMANS: That's the view in a report called "Building a North American Community." It envisions a common border around the U.S., Mexico and Canada in just five years, a border pass for residents of the three countries, and a freer flow of goods and people.

Task force member Robert Pastor.

PASTOR: What we hope to accomplish by 2010 is a common external tariff which will mean that goods can move easily across the border. We want a common security perimeter around all of North America, so as to ease the travel of people within North America.

ROMANS: Buried in 49 pages of recommendations from the task force, the brief mention, "We must maintain respect for each other's sovereignty." But security experts say folding Mexico and Canada into the U.S. is a grave breach of that sovereignty.

FRANK GAFFNEY, CENTER FOR SECURITY POLICY: That's what would happen if anybody serious were to embrace this strategy for homogenizing the United States and its sovereignty with the very different systems existing today in Canada and Mexico.

ROMANS: Especially considering Mexico's problems with drug trafficking, human smuggling and poverty. Critics say the country is just too far behind the U.S. and Canada to be included in a so-called common community. But the task force wants military and law enforcement cooperation between all three countries.

UNIDENTIFIED MALE: Indeed, an exchange of personnel that bring Canadians and Mexicans into the Department of Homeland Security.

ROMANS: And it wants temporary migrant worker programs expanded with full mobility of labor between the three countries in the next five years.

(END VIDEOTAPE)

ROMANS: The idea here is to make North America more like the European Union. Yet, just this week, voters in two major countries in the European Union voted against upgrading -- updating the European constitution. So clearly, this is not the best week to be trying to sell that idea.

DOBBS: Americans must think that our political and academic elites have gone utterly mad at a time when three-and-a-half years, approaching four years after September 11, we still don't have border security. And this group of elites is talking about not defending our borders, finally, but rather creating new ones. It's astonishing.

ROMANS: The theory here is that we are stronger together, three countries in one, rather than alone.

DOBBS: Well, it's a -- it's a mind-boggling concept. Christine Romans, thank you, as always.

There is no greater example than our next story as to why the United States must maintain its border security with Mexico, and importantly, secure that border absolutely. The police chief of the violent Mexican border town, Nuevo Laredo, was today executed. It was his first day on the job.

Alejandro Dominguez, seen here at his swearing-in ceremony, was ambushed by a number of gunmen several hours just after that ceremony as he left his office. The assassins fired more than three dozen rounds that struck Dominguez.

He was the only person who volunteered to become Nuevo Laredo's police chief. The position has been vacant for weeks after the previous chief of police resigned. The town is at the center of what is a violent war between Mexican drug lords. The State Department has issued two travel warnings for Americans about that area just this year. And amazingly, the Mexican government calls those State Department warnings unnecessary.

Still ahead, the military recruiting crisis is escalating. New questions tonight about the viability of the all-volunteer military. General David Grange is our guest.

And "Living Dangerously," our special report. Rising population growth in the West, dangerous water shortages, the worst drought arguably ever. We'll have that report for you next.

(COMMERCIAL BREAK)

DOBBS: Two more Americans have been killed in Iraq. A Marine killed in a traffic accident in western Iraq, a soldier killed in an accident north of Baghdad.

Insurgents today attacked a convoy that was carrying U.S. supplies west of Baghdad. Several trucks and SUVs were destroyed in the attack. No word yet on casualties.

In Baghdad, seven Iraqis were killed in an explosion at a bomb- making factory. Police said the explosion happened as insurgents were putting explosives into a car.

The war in Iraq is certainly a leading contributor for the slowdown in military recruiting. The Army says it will miss last month's already lowered recruiting target of 6,700 soldiers. It will miss it by 25 percent. The recruiting goal for the entire year is 80,000 troops.

At the same time, the U.S. Army plans to raise the target for the number of junior officers by 300 to 4,600 officers. The Army hopes to achieve that goal, it turns out now, by streamlining waivers for older candidates and by allowing more waivers for minor criminal or civil offenses.

Joining me now to discuss the military's escalating recruiting crisis is General David Grange.

General, good to have you with us.

BRIG. GEN. DAVID GRANGE (RET.), CNN MILITARY ANALYST: Thank you, Lou.

DOBBS: We have talked about the issues that are contributing to this dramatic shortfall from recruiting goals by the Army. What's going to happen?

GRANGE: Well, I think the military's going to take several actions in order to meet the goals that they've been unable to meet. A change in the age, for instance. And actually, it hasn't changed, it's just a waiver -- a different way to look at the waivers on the age of officers coming in, becoming officers.

Maybe one indication. But I think there's going to be some other drastic measures possibly taken.

DOBBS: General, the character of our military is so strong, the standards so high, but now, as the military is -- the Army is missing its recruiting goals, the Pentagon is making decisions that are effectively lowering those standards, that can't be good for morale. It can't be good for the general staff to sit there and look at standards that they were so proud of and to watch them decline simply because right now they cannot recruit effectively, can it?

GRANGE: Well, we don't want to have standards lowered. And I don't really think they're lowering the standards. And here's why I say that.

Actually, what they're talking about now in some of the news articles that we've looked at is that they're changing or highlighting things that are already allowed to have a waiver. And if the waiver is something on a minor offense, that maybe someone is over the years mature enough now that has proven that it's not an issue, that's not really lowering -- lowering the standard.

DOBBS: General, you are in Chicago tonight, and not Washington, D.C., right?

GRANGE: That's correct.

DOBBS: Dave Grange and I have known each other awhile. I think that we can kid one another from time to time on these things. But the fact is, it's no joking matter when we see the volunteer Army missing its recruiting goals.

No amount of waivers, no amount of change standards, if we may, if not lowered can recover from 40 percent shortfalls month to month in recruiting. We are looking at a severe critical issue here. What can be done? What should be done, in your estimate?

GRANGE: Well, I'll tell you, Lou, there's going to be a lot of talk about a draft. I personally don't agree with a draft.

I agree with some of these changes where maybe they're delegating waivers to a different echelon within a command. As an example, a 42- year-old lieutenant, to me, that's OK. I mean, I was in better shape at 40 years old than I was at 18 years old. And I think a lot of parents would like to have that type of maturity lead their sons and daughters if they're in a combat situation.

So I'm not hung up on those type of waivers, as long as those people meet the standard to be a -- to be a platoon leader, for instance, in the military. But what's going to have to happen, I think, is some type of national service -- we've talked about this a little before -- not just for the military, but for the whole nation. Because the nation itself, for homeland defense and other reasons, our own borders need help. DOBBS: Yes. It's a nation, this nation of ours, in which shared sacrifice and shared burdens are becoming increasingly diminished. And one has to wonder about whether or not that is good for the country, good for the nation.

We thank you for being here, as always, General David Grange.

GRANGE: Thank you, Lou.

DOBBS: President Bush's approval rating has slipped 11 points over the past four months. It now stands at 46 percent. In tonight's poll, our question is, why do you believe President Bush's approval ratings have fallen, Social Security reform, the war in Iraq, or illegal immigration? Please cast your vote at LouDobbs@cnn.com. We'll have the results later here in the broadcast.

Coming up next, ripping off America. China stealing the creations of American inventors, and they're getting away with it. How one American company was destroyed by China's unfair trade practices. We'll have that story next.

And a meeting between the Democrat who said Republicans haven't worked an honest day in their lives and another who call President Bush a loser. Howard Dean, Senator Harry Reid, together on Capitol Hill.

Stay with us.

(COMMERCIAL BREAK)

DOBBS: Twenty-six western states remain in the grip of the worst drought ever, and the rapid population growth in the western states is straining the supply of usable water. Now, recent rains have done very little to stem the drought, but have added to destruction instead.

Casey Wian reports.

(BEGIN VIDEOTAPE)

CASEY WIAN, CNN CORRESPONDENT (voice-over): The catastrophic La Conchita and Laguna Beach mudslides are dramatic evidence that at least in southern California the drought is a fading memory. The region has had more than three times its normal rainfall since October.

Hundreds of miles north, snow lingers in the mountains above California's San Joaquin Valley, the nation's most productive agricultural region. Twice the normal snow pack means water managers are for now more concerned about flood control than water conservation.

DANIEL VINK, LOWER TULE RIVER IRRIGATION DISTRICT: This is the first year after five years that we haven't had a drought. Obviously one year does not end a drought, but it sure goes a long way to help impact the water supplies in this area. WIAN: Water now spills over the top of the Friant Dam.

(on camera): For five years, the only water that was released from the Friant Dam was a relative trickle, just enough to keep the San Joaquin River flowing. Now an extra seven billion gallons a day is gushing out of the dam.

(voice-over): A stark contrast exists in southern Nevada, which depends on the Colorado River system for 90 percent of its water. Lake Mead recovered slightly this winter but remains nearly 80 feet below capacity, and is expected to drop another 20 feet this year. Strict water conservation measures remain in force.

PAT MULROY, SOUTHERN NEVADA WATER AUTHORITY: We are far from out of the danger zone. I mean, we don't know if last winter was simply a wet year in the middle of a dry cycle or whether it really signaled the end of a drought period.

WIAN: The national drought map displaying the driest areas in darker colors shows the worst of the drought easing during the past three months.

DOUGLAS LE COMTE, DROUGHT SPECIALIST, NOAA: There is a danger when you have one wet year like this, because historically we've seen cases where there have been long strings of dry winters only to be interrupted by one wet winter. So there's no guarantee that we won't reverse to a drier pattern come -- come next year.

WIAN: Water managers worry that customers will become complacent and abandon the conservation measures that have helped ease the historic drought. That's more important than ever with the West's population growth far outpacing its supply of water.

Casey Wian, CNN, Friant, California.

(END VIDEOTAPE)

DOBBS: Severe droughts -- and this one is no exception -- often result in devastating wildfires. One of those wildfires has already begun in Arizona, where a rapidly-moving brushfire has forced the evacuation of at least 30 homes near Wickenberg.

The Bureau of Land Management tells us that fire has now grown to 2,000 acres. The bureau says the fire should be fully contained by tomorrow evening, however.

The governor of Montana faces what he says could be a fire season of historic magnitude after a seven-year drought in that state. Making matters even worse, about half of the state's National Guard troops trained to fight those wildfires are now in Iraq and serving in Afghanistan.

In a bold move, the governor asked the Pentagon to return his National Guard troops to fight the wildfires that could ravage the state. The Pentagon refused to send them home.

Joining me now is the governor of Montana, Brian Schweitzer.

Governor Schweitzer, good to have you with us.

GOV. BRIAN SCHWEITZER (D), MONTANA: Well, it's great to be back, Lou.

DOBBS: Governor, this decision of yours to request the return of your National Guard troops from Iraq and Afghanistan, on what basis did you do so, and what was specifically the Pentagon's reaction?

SCHWEITZER: Well, you know, this has been an ongoing process. It's been about five years of really one of the worst droughts in the history of Montana.

We were faced with the middle of the winter, where we had historically low snow pack. And, of course, snow pack is money in the bank. That's the water that will be in the rivers during the next year, and it's what restores the moisture levels in our soils.

So in the middle of the winter, we were looking at what could have been one of the worst fire seasons ever. So good management says, let's get the resources we might need in place if we do have that sort of situation.

So we just suggested that, how about if we rotate some of our National Guard folks home so that they're in our communities in case we have a blowup in fires. This is predictable.

July and August, that's when we have fires in Montana. So we thought it would be a great move to rotate the trooms home, give us a little bigger force in Montana when we needed them in July and August. And so we asked the National Guard and they said no.

DOBBS: Just straight out, no?

SCHWEITZER: Yes, they said, well, if you need somebody, we'll send somebody from other states. But the fires that we have in Montana are in wild lands. These are big mountains, and this is where we don't have roads.

You fight them with helicopters. You fight them with people that are trained to fly in mountains. There's not that many helicopter pilots in the National Guard that are trained. You can't send me somebody from Indiana.

DOBBS: And the fact of the matter is that most of the Black Hawk helicopters that are used are also in Iraq and Afghanistan, aren't they?

SCHWEITZER: Here's my assets. We have 12 Black Hawks, nine are in Iraq. We have three --- three of the Chinooks, the CH-47s, but we don't have all the crews that we need.

The Black Hawks will carry about 660 gallons of water, and those big old Chinooks will carry 2,000 gallons of water. When you've got wildfires, you need to have a helicopter on them when they're three or four acres, not 3,000. If they get to 3,000 acres, they'll probably burn until it snows in September.

DOBBS: Governor, you also have taken note of the fact that not only are you facing a wildfire season that could, as I think you put it, be of historic magnitude, but you're also concerned about what is obviously the changing role of the National Guard in this country. How concerned are you about that?

SCHWEITZER: A dozen years ago, we had a military that was approximately 10-1 active duty to Reserve and Guards. Now we're about 2-1.

So we're calling on our guards in a higher proportion than we have at any time in history. And so I think we need to start a discussion between the governors who, like myself, are the commanders in chief of our National Guards, and those that are in charge of the active forces. Because part of the Guards' mission is homeland security, whether it be natural disasters, such as fires or floods or tornadoes or hurricanes, or some of the other unthinkables.

When you take our assets such as our manpower and our helicopters and our planes, when you take our trucks, our jeeps, I think you have to have a discussion about how can the governors be responsible for our homeland security in each and every one of our states and then take away our assets.

DOBBS: An important question. And one that we'll be exploring on this broadcast, I assure you, for some time.

Governor Brian Schweitzer, thank you for being here.

SCHWEITZER: Great to be back, Lou. Thanks.

DOBBS: A problem of a very different nature in the Southeastern United States. The first named storm of the Atlantic hurricane season is now expected to hit the eastern Alabama coastline Saturday.

Right now, Tropical Storm Arlene is headed toward western Cuba. It's expected to slam ashore there tonight. Forecasters say flooding is expected in Cuba and Florida as well. Authorities have warned those living on the Gulf Coast to be on alert. Some of those residents still haven't fully recovered from the last hurricane season.

On Capitol Hill today, Democratic National Committee Chairman Howard Dean met with another outspoken Democrat, Senate Minority Leader Harry Reid. They're meeting was planned long before Dean's recent comments, saying Republicans haven't worked an honest day in their lives and saying that the GOP is a party of mainly white Christians. Dean and Reid said the meeting wasn't to talk about those comments, but to discuss education, the economy, the war in Iraq. Dean, for his part, said Republicans are trying to use his recent comments as a distraction.

(BEGIN VIDEO CLIP)

HOWARD DEAN, DNC CHAIRMAN: We're going to talk about our agenda. We're not going to let the Republicans set the agenda, and to be quite hones, we're not going to let you set the agenda. We're going to set the agenda.

(END VIDEO CLIP)

DOBB: Senator Reid responded to dean's controversial comments. Senator Reid said Dean had, quote, misspoken. But Senator Reid added that Dean isn't the first politician to do so. You may recall that Reid himself caused some controversy recently when he called President Bush a loser. Previously he had called the president a liar.

Coming up next, United States trade policy failing American workers. Two Congressmen say an immediate pullout from the World Trade Organization is the only solution. Those Congressmen join us next.

And the invasion of illegal aliens in this country is nothing short of a crisis. The county commissioner of one American community says he has a plan that will help to stop this invasion. He is our guest next. Stay with us.

(COMMERCIAL BREAK)

DOBBS: Tonight China and its unfair trade practices are stealing American innovation. One U.S. company saw its business plunge after China ripped off its designs. The company sued and won a record- setting reward. But it has yet to receive any of the money that China was ordered to pay. Bill Tucker reports from Orlando, Florida.

(BEGIN VIDEOTAPE)

BILL TUCKER, CNN CORRESPNODNET (voice-over): This crime is every bit as real as this crime. But the one seen here caught on tape by an undercover investigator is theft on a much larger scale. It is the sale of pirated goods and technology by a Chinese company which stole the proprietary lighting technology from an American company, Super Vision of Orlando, Florida. Super Vision's products can be found as close to home as New York's Times Square and as far away as Tokyo, 1999 was a bad year.

BRETT KINGSTONE, CEO, SUPER VISION: In 1999, I believe, we showed a 50 percent decline in our sales in Asia, just in the first year since the counterfeiting started. So it was a huge impact. And we probably lost between 25 and 30 percent of our sales in Europe and South America.

TUCKER: Super Vision fought back. And a jury in Orange County, Florida, gave it the largest award ever granted in such a case, $41.5 million. Super Vision has never seen a penny of that money. The assets of the Chinese company were transferred offshore where they can't be touched.

(on camera): What happened to Super Vision isn't unique. It's a story that is repeated time and time again to companies all across the United States at a staggering cost to the companies, and to the economy. (voice-over): There is no precise number, but everyone agrees the annual cost are in the hundreds of billions of dollars.

PAT CHOATE, AUTHOR: The Department of Commerce estimates that every $1 billion of trade or commerce equates out to about 10,000 jobs. $300 billion of counterfeiting means 3 million stolen jobs. That's a lot.

TUCKER: And that undermines our economy.

REP. LAMAR SMITH, (R) TEXAS: If we let other countries steal those ideas from us and then make them at a fraction of the cost, you know, that is undercutting our industry. It's costing us jobs.

TUCKER: For Super Vision's Kingstone it portends something even worse.

KINGSTONE: I think if it continues for another couple of decades, we may not have a manufacturing economy or a middle class.

TUCKER: Since 2000, the United States has not brought a single case of intellectual property theft before the World Trade Organization.

Bill Tucker, CNN, Orlando, Florida.

(END VIDEOTAPE)

DOBBS: My guests tonight sponsored a critically important resolution in Congress. The resolution calling on the United States to withdraw from the World Trade Organization.

Congressman Bernie Sanders, an independent from Vermont who introduced the legislation declared, "WTO rules have failed the American worker, the American standard of living and the American dream. WTO rules have made American jobs our No. 1 export."

The resolution's co-sponsor, Congressman Ron Paul, Republican of Texas said, "for the United States to give up any bit of its sovreignty to these unelected and unaccountable organizations, including the WTO, is economic suicide."

Today's resolution failed by 338 votes to 86. My guests, nonetheless, believe that opposition to the so-called free trade agreements is rising. Congressman Sanders, Congressman Paul join us now. Good to have you with us.

REP. BERNIE SANDERS, (I) VERMONT: Good to be with you, Lou.

REP. RON PAUL, (R) TEXAS: Thank you.

DOBBS: Perhaps disspiriting that you would see a vote of that magnitude against your resolution. Let's begin with you, Congressman Sanders. What is your reaction?

SANDERS: No, I'm not disspirited at all. Congressman Paul five years ago made a great effort bringing forth an amendment and today we got 50 percent more votes. We went from 56 to 86 votes. That tells me that there is a growing momentum on the floor of the House, and among the American people, to end our disastrous trade policies, which is causing the collapse of the middle class, the loss of millions of decent-paying jobs, and the growing gap between the rich and the poor.

So I think more and more members are -- of Congress are catching on, are going to be voting for change. And I think we have an excellent chance to defeat CAFTA when it comes up in a few weeks.

DOBBS: Congressman Paul, you were one of three dozen Republicans to vote in favor of withdrawing from the WTO. What does that suggest to you about the direction of the Republican Party itself? Many would be surprised that that many Republicans were willing to withdraw.

PAUL: Yes. I was impressed. And there were some committee chairman on there, there was people in the leadership that voted with us. That was very impressive to me. And I think this does spell a lot of trouble for CAFTA.

So it's much more difficult to get out of the WTO than it is to continue the policy, and that is get further entrenched in more of these agreements. So I would say that this is a sign, which has been whispered around the Hill already, that CAFTA's in trouble, and it will be awhile before they bring it up, because they just don't have the votes.

DOBBS: Let me ask you both, again, turning back to you, Congressman Sanders, why in the world representatives from both parties -- why in the world aren't those Congressmen more concerned about what is now a 30-year track record of trade deficits, now at record levels, why aren't they more concerned about working men and women in this country, Democrats and Republicans, who are just being slammed by these trade policies -- jobs lost, pain exacted on their families, and frankly, fools running around talking about retraining without suggesting what those jobs are that they should be retraining for.

REP. BERNIE SANDERS, (I) VERMONT: Lou, what is particularly disheartening is that if we do not change our trade policies, what all the studies tell us is that the next generation will have for the first time in the modern history of America, a lower standard of living than our generation.

What all of the studies suggest is that most of the new jobs that are going to be created are low-wage jobs, which require only a high school degree on-the-job training, low wages, poor benefits. We're losing the General Motors type jobs. As you know, GM just announced they're going to cut another 25,000 workers. It is quite possible in 20 years the entire automobile industry will be in China. And our kids will be flipping hamburgers at McDonald's or working at Wal-Mart.

To answer your question, I have to -- I don't know what Ron thinks, but to my mind it has to do with the power of big money. Right here on Capitol Hill, these large corporations throw money around, they lobby, they give campaign contributions, they contribute to the political parties. And unfortunately, too many members of Congress vote the money and not their constituents.

DOBBS: A compelling statistic that we recently reported on this broadcast, the pharmaceutical industry alone, two lobbyists for every Congressman on Capitol Hill. Congressman Paul, Republicans are considered to be the, if you will, the party of fat cats. How threatened do you feel when the Democrats are also succumbing at the same rate to the power of corporate America and its lobbyists?

PAUL: Well --

DOBBS: Do you feel a little threatened?

PAUL: Well, I think the longer we're around here, Bernie and I, the more we realize on some of these issues there's not a whole lot of difference when it comes to foreign policy and trade policy. There's a lot of agreement. And I certainly agree, money talks.

But there's a lot of ignorance around here, too. And I say this in an academic sense. There's a lot of misunderstanding. There are some sincere people here who really believe that they're doing the right thing. But money really talks. The pharmaceutical industry is a perfect example of it.

And as long as they have that much influence, there's going to be a lot of arm-twisting. So we have a tougher battle, we're competing against the party leadership as well as the money, and we still make inroads. So that mean, I believe, we're on the right track.

SANDERS: Let me just pick up...

DOBBS: Before I do, Congressman, let me ask you -- because we're out of time -- but I've really got to ask this last question, because we are out of time. If you would give me -- both of you, a succinct answer. Working men and women watching you gentlemen here tonight, sitting on Capitol Hill, serving the country, what are the odds that we're going to see real representation of the views, the interests and the values of American working men and women anytime soon?

PAUL: Well, I would say we're not going to see it anytime soon. But I believe that we have to believe it can happen or we shouldn't be here in Congress. We have to be optimistic enough to work within the system to try to change it. But I think it will come. But, unfortunately, I think there's going to be a lot of pain and suffering before we wise up and do the right thing.

SANDERS: I would agree with Ron. I think we need a revolution in our political culture. We need people to be involved in politics 365 days a year. And we need people to organize to take on the big money interests, which now have a stranglehold on Washington.

DOBBS: Congressman Bernie Sanders, Congressman Ron Paul, thank you both for being here.

PAUL: Thank you.

SANDERS: Thank you. DOBBS: A reminder now to vote in our poll tonight. "Why do you believe President Bush's approval ratings have fallen? Social Security reform, the war in Iraq or illegal immigration?" Cast your vote at LouDobbs.com. We'll have the results later in the broadcast.

Still ahead, the invasion of illegal aliens -- how a county commissioner in one state has fought back against firms that employ illegal aliens. That commissioner is our guest here next. Stay with us.

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DOBBS: The influx of illegal aliens into this country has reached nothing short of a crisis as we report here almost nightly. Since the federal government has failed absolutely to deal with the issue of illegal immigration and border security, my next guest proposes his own plan to handle what he calls the imminent invasion from Mexico. Robert Vasquez is commissioner of Canyon County, Idaho. He wants to sue the people who hire illegal aliens. That plan would make Canyon County, Idaho, the only local government in this country to use federal racketeering statutes against people who employ illegal aliens.

Commissioner Robert Vasquez joins us tonight from Boise, Idaho. Commissioner, good to have you with us.

ROBERT VASQUEZ, CANYON COUNTY COMMISSIONER: Thank you, Mr. Dobbs. Pleasure to be here, Mr. Dobbs.

DOBBS: The idea that employers are hiring illegal aliens, clearly in violation of law throughout the country, how has it reached a point in which local authorities, state authorities and of course federal authorities have ignored the blatant illegality of doing so?

VASQUEZ: Well, I was listening to your previous segment. I believe that certainly those World Trade Organizations have had some influence in the passage of NAFTA, and certainly in the preparation of CAFTA. It's merely the establishment of the 21st Century slave trade, as I see it. It affects not only my county, but the United States. And I'm pleased to see that representative Bernie Sanders and others are taking action on that.

DOBBS: Commissioner, the idea that you bring to bear, that is using racketeering statutes, to actually go after the -- those firms that hire illegal aliens, how soon can you do what you propose? And precisely what will happen, in your judgment, to those employers?

VASQUEZ: Well, Mr. Dobbs, we're on a fast track, as I see it. We initiated this action in March. We brought in Howard Foster, who's an attorney from Johnson Bell. He rendered an opinion letter indicating that we had standing. And from there we're proceeding with the investigation. When that investigation is concluded, we'll proceed to the next step, which will involve the filing of a brief -- and then possibly the lawsuit to follow.

DOBBS: Without naming names, unless, of course, you want to name names, which -- describe quickly if you could, the companies that are hiring illegal aliens and how many in your community?

VASQUEZ: My understanding is that it's across the labor spectrum, from construction to restaurants, et cetera. And certainly any business that is hiring people in 10 to 100 employees is susceptible to that. I've been told by many that, well, you know, we've had to do this because we have to compete. Well, I disagree with that. There's no reason to break the law because your neighbor's breaking the law.

DOBBS: Commissioner, the idea of going after these firms, what has been the reaction in the community? Do you have support, or is there broad opposition to what you're trying to accomplish in Canyon County?

VASQUEZ: Yes. Obviously I have great, I believe, support from the rank and file, the people that understand that I am working on their behalf. As you indicated to your previous guests, congress can work the benefit of the working man. And that's what I'm attempting to do to secure jobs for American citizens

Those that are opposed to me are the people that are hiring the illegal aliens, profiting from the exploitation of their labor, and passing on the costs of those individuals to their fellow taxpayers.

DOBBS: Well, many farmers, construction companies, in your region tell us that they don't feel they can survive without that illegal labor. How do you react?

VASQUEZ: Well, if your business depends on breaking the law and the exploitation of labor, then perhaps you don't need to be in business.

DOBBS: Commissioner Robert Vasquez, we thank you. We'll be talking as you move this initiative ahead. Thank you.

VASQUEZ: Thank you.

DOBBS: Tonight's "Quote of the Day" is on immigration reform, if you can call it that. House majority leader, Congressman Tom DeLay, described President Bush's admission about his immigration policy. "He admitted," said Tom DeLay, "that the president hasn't done a very good job in being clear to the American people where he's coming from and what he's going to try to do better." We're going to find out what he's going to do better.

Coming up next, we'll share some of your thoughts and I'll respond to what some call a political bias on this broadcast, and we are going to confess our broadcast here tonight. Stay with us.

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DOBBS: Let's take a look now at some of your thoughts.

Chuck Williams in Indian Rocks Beach, Florida: "How can we possibly keep small insects and fish out of our country when we can't keep full grown people out?" From C. Ofsonka from Durham, North Carolina: "Aren't all government officials who do nothing to curb illegal immigration aiding and abetting a criminal activity and thus open to prosecution?"

And Fernando Pena, San Jose, California: "As a Latino, I am sickened by groups such as MECHA and MALDEF. These are racist anti- American groups. Their goal is simple: to fully Latinize the USA and to ultimately turn America into a Spanish-speaking country."

And, Dave in Fayetteville, Georgia: "I don't know where I was when `we the people' lost control of this country to a bunch of fools on a hill, but I want to be around when we take it back. Keep up the fight, Lou."

And, Howard Hickey in Winfield, Kansas: "Guess if I want an American-made car I'll need to buy a Toyota, Nissan or Subaru. What do you say?" I say, good luck to all of us.

And two viewers wrote in to complain about my supposed political bias on this broadcast.

J.D. Polly in Titusville, Florida: "You keep showing your liberal bias."

And, Jim Teraz of Irvine, California, wrote, "You are showing your true conservative colors..."

Now, I know it's frustrating to some of our viewers, but this broadcast is not biased by the Democrats or Republicans. In fact, I often wonder how anyone can be biased in favor of either political party these days. But on this broadcast, we do want to confess our bias. We are in favor of America, and we are in favor of Americans, and we will continue to demonstrate that bias as best we can each and every evening here. We love hearing from you. Send us your thoughts at LouDobbs@CNN.com.

Each of you whose e-mail is received on this broadcast receives a copy of my book, "Exporting America." Also, if you would like to receive our e-mail newsletter, sign up on our website at LouDobbs@CNN.com.

Still ahead, the results of our poll tonight. The question, why do you believe President Bush's approval ratings have fallen? And, we'll have a preview of what's ahead tomorrow. Please stay with us.

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DOBBS: The results now of tonight's poll: 18 percent of you say President Bush's approval ratings have fallen because of Social Security reform; 52 percent say because of the war in Iraq; 30 percent, because of illegal immigration.

Thanks for being with us tonight. Please join us here tomorrow. Our special report, "Living Dangerously" -- some of the most beautiful places to live in this country are also the most dangerous. Fault lines, sand bars, volcanoes and more, putting American communities and lives at risk. And, former acting CIA director John McLaughlin joins us to talk about the terror arrests in California, the Patriot Act, and more.

Please be with us. Thanks for being with us tonight. For all of us here, good night from New York. "ANDERSON COOPER 360" starts right now. Anderson?

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