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CNN LOU DOBBS MONEYLINE
Progress Made in Israeli-Palestinian Talks
Aired May 29, 2003 - 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: Wolf, thank you very much.
And, good evening everyone. Target Scumbags, U.S. commanders say they will crush the Iraqi gunmen who killed five American soldiers this week. Senior Pentagon Correspondent Jamie McIntyre will have the report.
Crimes of the times, the deepening scandal over plagiarism and falsification at "The New York Times," Peter Viles will report.
Howard Kurtz of the "Washington Post" will be here to discuss reporting standards in the media.
And, patriot debts, many reservists can't pay their bills because of the Pentagon's bureaucracy and incompetence. Bill Tucker will have that report.
And, Senator Bill Nelson who has accused the government of ineptitude will be our guest.
Our top story tonight, U.S. commanders in Iraq say they will destroy the Iraqi gunmen who were attacking coalition forces. Lieutenant General David McKiernan said the coalition will apply all necessary combat power to remove opposition forces. A Marine Corps General was more blunt. He called the gunmen scumbags.
Senior Pentagon Correspondent Jamie McIntyre joins us with the story -- Jamie.
JAMIE MCINTYRE, CNN SR. PENTAGON CORRESPONDENT: Well, for U.S. troops patrolling Baghdad there is no relief in sight. Take, for instance, the battle weary 3rd Infantry Division which is being relieved in Baghdad, but instead of going home as originally hoped, they're being dispatched to other hotspots in Iraq.
U.S. commanders admit much of Iraq remains a combat zone but they downplay the rash of guerrilla-style attacks that in recent days have left five U.S. soldiers dead and more than a dozen others wounded.
(BEGIN VIDEO CLIP)
LT. GEN. DAVID MCKIERNAN, U.S. ARMY: I said I think they are orchestrated at the local level and I believe that our initial reports would indicate that there is a connection between Ba'athist holdouts in that area. We have apprehended over the last couple weeks several Ba'athists and taken them under detention. This might be a reaction to that and so in my mind that's the leading contender for who's behind these attacks.
(END VIDEO CLIP)
MCINTYRE: But while U.S. commanders believe that they have die- hard Ba'athist loyalists on the run, Ahmed Chalabi, the leader of the Iraqi National Congress believes that the trouble stems from the failure so far of U.S. troops to capture Saddam Hussein.
(BEGIN VIDEO CLIP)
AHMED CHALABI, IRAQI NATIONAL CONGRESS: Saddam is still alive and he's still in Iraq and he's renewing his activity, his network of distributed leaflets in the past few days in Iraq, and they are trying their best to foment discontent among the Iraqi people.
(END VIDEO CLIP)
MCINTYRE: Chalabi and U.S. commanders agree on one thing, though, that the majority of the Iraqi people want Saddam Hussein gone and are providing key information to route out the remaining resistance.
(BEGIN VIDEO CLIP)
MAJOR GENERAL JAMES MATTIS, U.S. MARINE CORPS: There are still some regime thugs in our area. We're having to deal with them. They're not significant. They're relatively easy to whack when we have to take them out. The Iraqis point them out to us. They are a big help. They don't want these people around anymore except where they're still intimidated by them.
(END VIDEO CLIP)
MCINTYRE: In a just completed radio interview, a nationwide radio interview, Defense Secretary Donald Rumsfeld also complained that Iran was contributing to the trouble by broadcasting inflammatory messages into Iraq, stirring up anti-American sentiment. He again called Iran unhelpful, but when asked point blank if the U.S. was gearing up for war with Iran, he said "not to my knowledge" -- Lou.
DOBBS: Jamie, the words of the two generals reassuring but in point of fact five Americans have died in Iraq in the past 24 hours. Specificity, what is this Pentagon that has to this point by all appearances been reluctant to take significant steps going to do to provide security for our forces there?
MCINTYRE: Well, I think that they would disagree that they haven't taken significant steps. The commanders believe that they're adapting very quickly to the tactics employed by some of these resisters. They're putting in a weapons control program. They are greatly increasing the number of patrols.
They're targeting the people that they believe are responsible and they're carrying out a very aggressive campaign, again moving some of these combat troops into other areas where they think there are pockets of resistance. So, they say they are meeting the military challenge head on.
DOBBS: I understand that there might be a difference of perspective from a number of quarters on this issue but five American service members dead in 24 hours is that considered an acceptable level of casualty?
MCINTYRE: Yes, I don't think any level is acceptable to them but they do admit that Iraq remains a combat zone and it is not a peaceful situation. There are remnants of the regime that they have to route out and while they're doing that, they may take some casualties.
But the U.S. says it has the staying power. It has the resources and the Pentagon has told the commanders there that anything they feel they need to get the job done they will get from the Pentagon.
DOBBS: I said five dead over the past 24 hours, I meant five dead over this week. Jamie McIntyre, as always, thank you very much, Jamie McIntyre our Senior Pentagon Correspondent.
British Prime Minister Tony Blair is the first foreign leader to visit Iraq since the overthrow of Saddam Hussein and today Blair praised the performance of British troops in carrying out that overthrow. Blair also thanked his troops for their courage.
(BEGIN VIDEO CLIP)
TONY BLAIR, BRITISH PRIME MINISTER: I think what will be very clear is that when people look back on this time and look back on this conflict, I honestly believe they will see this as one of the defining moments of our century and you did it.
(END VIDEO CLIP)
DOBBS: And, President Bush will be in the Middle East next week. Mr. Bush will meet with U.S. troops in Qatar, but first the president goes to Poland, a close ally in the war against Saddam Hussein.
President Bush will then travel to St. Petersburg in Russia to join celebrations marking that city's 300th anniversary. The president then goes to France. There he will participate in the G8 summit of leading industrialized countries. And then, he goes to Egypt to meet with Arab leaders.
From there, he travels to Jordan for a historic summit with the Israeli and Palestinian prime ministers. President Bush will end his trip in Qatar with a visit to the headquarters of Central Command.
Ahead of their summit with President Bush, Ariel Sharon and Mahmoud Abbas met in Jerusalem today. The two prime ministers tried to resolve disagreements about security and plans to create a Palestinian state.
Kelly Wallace joins us now live from Jerusalem -- Kelly. KELLY WALLACE, CNN CORRESPONDENT: Lou, both sides indicating some progress was made behind closed doors during this two and a half hour working dinner and both sides definitely facing some pressure from the American administration to make some progress now before next week's summit with President Bush.
The Israelis are saying there was a good atmosphere between the two men, Palestinians describing it as serious, candid, and beneficial. Sources are telling us that Israeli Prime Minister Ariel Sharon offered to pull Israeli troops out of West Bank towns and also out of parts of the Gaza Strip if the Palestinians are prepared to take charge of security in those areas.
The Israelis also said that they are going to implement a number of unilateral measures to ease the plight of the Palestinian people. Some of these measure they had put forward two weeks ago but then pulled back after five suicide bombings, measures such as now allowing Palestinians with permits to access Israel from the West Bank and the Gaza Strip, issuing more work permits for the Palestinians and releasing some administrative detainees.
Now, the Palestinians say these steps are welcome but that Prime Minister Mahmoud Abbas is looking for more substantive measures on the ground. In his meeting, Palestinian sources said, he called for an end to Israeli military operations in the West Bank and the Gaza Strip and end to targeting killings which Palestinians call assassinations, freezing of settlement activity in the West Bank and the Gaza Strip, and also an end to the siege of Palestinian President Yasser Arafat.
Now, both sides are saying the two men have agreed to continue their discussions, resume talks at the prime minister level and also at other levels, and we do know that American officials are expected to be in the region as early as Friday working with both sides on the statements that are likely to come out of next week's summit.
Both sides then expected to announce exact steps they are willing to take, in the words of one official, Lou, to indicate that this roadmap is truly on the road to peace -- Lou.
DOBBS: The process underway, Kelly Wallace, thank you very much, Kelly Wallace reporting from Jerusalem.
Now, a dramatic and exclusive story about the war against Saddam Hussein, for the first time we can tell you how the headquarters of coalition ground forces in Camp Doha in northern Kuwait narrowly escaped destruction from an Iraqi missile on March 27, eight days after the war began.
A CNN crew was there and captured the event. The access was unprecedented and some of the video you're about to see was reviewed by the Department of Defense security officials.
Mike Boettcher joins us now live. Mike, tell us what happened when Iraq fired that missile.
MIKE BOETTCHER, CNN NATIONAL CORRESPONDENT: Well, Lou, it all began as you said on March 27 at 8:30 a.m. Zulu. That would be mid- morning Kuwait time, during what is called the BUA, which is the Battlefield Update Assessment.
Let's take a look at what occurred at that point when they're going through that assessment in the headquarters. This is inside the war room in Kuwait, exclusive access, where the generals are discussing the battle plan for that day and the coming days.
Then suddenly, there will be a warning. Lightning will be shouted out, meaning an incoming Iraqi missile has been spotted. At that point, they will put on their gas masks and they will go to Mach 4. We see it now.
Then they carry on with their duties. About 200 people inside of this room, everyone from intelligence officers to operations officers, not knowing that a missile is inbound aimed right at their building. According to the deputy commander, General Fuzzy Webster, the Iraqis had to have very good intelligence.
(BEGIN VIDEO CLIP)
MAJ. GEN. WILLIAM WEBSTER, COALITION GROUND FORCES: We've been operating out of these two buildings that are together here at Camp Doha for ten years and so there's been a long time for that information to get back from agents to Saddam and for him to lay that grid into his weapon systems and prepare to shoot it.
(END VIDEO CLIP)
BOETTCHER: Seconds before that missile would have impacted at the headquarters or right nearby it, two Patriot missiles were fired. They did their job protecting (unintelligible) headquarters. It was a very close call, however, and we can report it now -- Lou.
DOBBS: Mike, thank you very much. Those Patriot missiles appear to have stood up impressively in this conflict.
BOETTCHER: Absolutely. I was standing in Dharan in Saudi Arabia back in 1991 when Patriots were fired then. We just assumed they work and found out later on that they didn't work very well. These did work.
They tracked exactly on that missile and then they were able to plot the trajectory and that's how they knew it would have landed right there at (unintelligible) headquarters. Because they knew the trajectory, they were able to trace it back and two A-10s in the area near Basra, north of Basra, were launched to take out that battery and they did -- Lou.
DOBBS: Mike, thank you very much, fascinating story, Mike Boettcher reporting.
We'll have more on this dramatic story in a special edition of "CNN PRESENTS: INSIDE THE WAR ROOM." We'll present that Sunday, 8:00 p.m. Eastern, 5:00 p.m. Pacific, right here on CNN. Turning now to our "Quote of the Day," from a U.S. Senator who supports preemptive strikes against terrorists: "I can tell you that if the terrorists are able to launch and get on our soil, we are in a lot more trouble than if we go at them before they can take off from whatever country might be hosting them," that from Senator Sam Brownback, Republican, of Kansas.
Still ahead here, our series of special reports on healthcare continues tonight as we focus on the cure for millions of uninsured Americans.
Also, we asked them to fight but the Pentagon bureaucracy screwed up the paychecks for our troops. Senate Armed Services Committee member, Senator Bill Nelson, joins us to tell us what he expects the Pentagon to do to fix it.
(COMMERCIAL BREAK)
DOBBS: The latest SARS outbreak is worsening and it may be significantly larger than first estimated. The number of probable cases in Toronto could jump from 12 to more than 60 if a broader definition of SARS is applied. World health officials now say Canada's current definition is too limited. More than 7,000 Canadians are currently under quarantine.
Last night we reported on the Democrats' plans for reforming this country's healthcare system. Tonight, we focus on the Republican proposals in this healthcare debate, Kitty Pilgrim reports.
(BEGIN VIDEOTAPE)
KITTY PILGRIM, CNN CORRESPONDENT (voice-over): A typical job in a typical company, what is one of the key selling factors for the American worker, salary, hours, perks? Forget it. It's health coverage, not something to be ignored politically.
With a series of new Democratic proposals on healthcare, Republicans are focusing on their own proposals. One of the key Republican thinkers on this issue is Bill Frist, first a doctor and now a Senator, top on his agenda, reforming and strengthening Medicare to include prescription drugs for seniors.
That will be taken up next week in the Finance Committee with floor action anticipated later in June. Over the next ten years, seniors will spend $1.8 trillion on prescription drugs. None of that is covered. President Bush has proposed a tax credit to boost individual health coverage.
ROBERT MOFFIT, THE HERITAGE FOUNDATION: The president's agenda is to target tax relief in the form of tax credits or direct premium subsidies to individuals and families who do not get health insurance through the place of work, and the president has proposed a $90 billion program over a period of ten years to target those individuals and families who do not or can not get health insurance through the place of work. PILGRIM: Most Americans do get coverage from their employer. Eighty-six percent of Americans, some 160 million who are working have health insurance coverage. Still, 41 million Americans are without insurance and many of those don't get health benefits because their companies don't offer it or they are part-time workers or they don't qualify.
PAUL GINSBURG, CTR. FOR STUDYING HEALTH SYS. CHANGE: The premise of it is that there are working people that have some income but not enough to afford health insurance. These are people whose employers do not provide coverage and the president's tax credit proposal would offer tax credit for individuals to go into the individual insurance market and purchase health insurance on a subsidized basis.
PILGRIM: The Fiscal 2004 budget resolution recently passed includes $50 billion to expand access to health coverage to uninsured Americans. Public opinion is strong. One study finds a strong majority when asked say healthcare should be provided equally to everyone, just as public education is, regardless of age, health status, or employment.
(END VIDEOTAPE)
PILGRIM: Now, Democrats have taken the headlines in recent weeks with their flurry of new proposals. Now, the Republican plans have been long in the works. They're equally well thought out, so expect the debate to heat up in the next few weeks with Republicans taking back a few of those headlines -- Lou.
DOBBS: And with Senator Frist in the Senate a physician is that helpful at all here?
PILGRIM: It certainly is. I mean the man is very well versed in the entire subject. He is putting forward a proposal to strengthen Medicare to include prescription drugs. That's expected sometime next week.
DOBBS: Howard Dean, a physician, is that a leg up for him?
PILGRIM: I wouldn't wonder.
DOBBS: OK, Kitty, thank you very much.
Tomorrow night here we'll focus on the healthcare benefits received by members of Congress and federal employees. Bill Tucker will tell us all why we might want that plan for our families.
And, that brings us to the subject of tonight's poll: "Do you believe the federal government should be playing a larger role in the nation's healthcare system, yes, no, or what healthcare system?" Cast your vote at cnn.com/moneyline. We'll have the preliminary results later in the broadcast.
Now, the final results of yesterday's poll. The question was: "Do you think your portion of the tax cut is just right, not enough, or too much?" Seven percent said just right, 46 percent said not enough, 47 percent said too much.
Coming up next, U.S. troops under fire from an American bank, but red tape at the Pentagon is the real problem. Senator Bill Nelson of the Armed Services Committee is outraged. He says this is inexcusable and he joins us next.
And, more fallout tonight from the scandal at "The New York Times," Howard Kurtz of the "Washington Post" joins us to share his views on the scandal and the impact on the media.
(COMMERCIAL BREAK)
DOBBS: A bureaucratic Pentagon has a number of Army reservists and members of the Army National Guard in trouble with the Bank of America. The Pentagon falling deeply behind on reimbursement of the troops for their travel and other expenses and that has reservists unable to pay their credit card bills, Bill Tucker reports.
(BEGIN VIDEOTAPE)
BILL TUCKER, CNN CORRESPONDENT (voice-over): When reservists are called to active duty they're responsible for paying their way to the base and they're responsible for paying their housing if there's no housing available on the base.
To help with those expenses, the Pentagon gives those reservists a credit card with payment terms of 30 days. The idea is that the Defense Department will then reimburse the soldier or sailor before the bill is due. That's the idea.
The reality is the Pentagon has been slow to pay, leaving reservists to field collection phone calls from Bank of America. The Pentagon admits the problem saying the size and the speed of the mobilization was unprecedented and they also say they're committed to fixing the problem.
BRYAN HUBBARD, DEFENSE FINANCE AND ACCOUNTING SERV.: First, we've authorized overtime for all of our employees who are dedicated to delivering great service to America's servicemen. Second, we're working with the Army to bring on additional reserve units to augment our workforce. And three, we hired twice as many contractors who are involved in processing these vouchers to get the job done and bring that backlog down.
TUCKER: Expenses for roughly 23,000 reserve and Army National Guard members are currently backlogged in the system. A spokeswoman for Bank of America says most of the collection calls have now stopped. The bank is working with the Pentagon, being more flexible, and extending its past due date out to 75 days.
(END VIDEOTAPE)
TUCKER: Since 1991, the Defense Financial Accounting Services Division has consolidated 300 financial units down to 26. Efficiency, however, doesn't seem to have made it through the consolidation. It's currently taking 23 days to process what it typically does in eight -- Lou.
DOBBS: Well, that's not exactly a Rumsfeldian improvement in efficiency, is it?
TUCKER: It's certainly not a lean, mean, paying machine, Lou, no.
DOBBS: All right, Bill Tucker thank you.
Well, our next guest called upon the Pentagon to fix this problem. Senator Bill Nelson of Florida is a member of the Senate Armed Services Committee joins us tonight from our Miami Bureau, Senator, good to have you with us.
SEN. BILL NELSON (D), FLORIDA: Thanks, Lou.
DOBBS: What did the Department of Defense say when you brought this to their attention?
NELSON: Well, they first said it wasn't true. They said we pay our bills within three days and I said well that's certainly not the information I have for about 23,000 Army and National Guard reservists, so you better check it and you better get that credit card company to stop harassing those soldiers who have been called to active duty. They called back right after Memorial Day and said you were right.
DOBBS: And, did they in fact intercede with the Bank of America specifically here?
NELSON: Yes, they did. They told the bank to stop the harassing phone calls and I mean that's just common sense. We ought to be honoring these people that we called to active duty, not harassing them.
DOBBS: Absolutely, and how in the world did this Pentagon, Secretary of Defense Rumsfeld has made a very big point of streamlining, bringing, introducing efficiency, productivity here, how in the world could we be watching this process balloon to 23 days and this bureaucratic problem persist?
NELSON: Well, it's bureaucratic bungling. It is a big bureaucracy and there are going to be mistakes and this was a doozie (ph) of a mistake.
DOBBS: What does this say about the way this Pentagon is operating? Is this anomalous or is there an issue about the way, and we say the Pentagon that we are permitting our men and women in uniform to be treated in this country?
NELSON: I don't think so, Lou. I think, you know, the extraordinary outpouring of sentiment that is so positive for all these young men and women, and by the way it's not just the ones in uniform because you know how integral the CIA and the FBI and other federal agencies have been to this war effort over in Iraq and Afghanistan, I think there's genuine good will all over the country and when a mistake is made like this, it's inexcusable but it's now corrected so let's move on.
DOBBS: And you're satisfied with the response of the Department of Defense here?
NELSON: As long as they have done what they told me that they've corrected this problem immediately, I think now we ought to ask of the Air Force and the Navy, the Marines, to make sure that it's not a problem on their reservists, but hopefully this episode is behind us.
DOBBS: And I know, Senator Nelson, you'll be following up to make certain that what the Pentagon said they would do they in fact do. Senator Nelson, it's great to have you here.
NELSON: Thanks, Lou. Have a good evening.
DOBBS: You too.
When we continue our "Thought of the Day" on truth.
Then, the budget crisis across this country is turning one city into a fine mess as police issue tickets for everything under the sun. Maria Hinojosa will have that story for us.
And, a second reporter says goodbye to "The New York Times" amid a broad investigation of the gray lady. "Washington Post" media reporter and media watchdog, host of CNN's "RELIABLE SOURCES" Howard Kurtz joins us. Stay with us.
(COMMERCIAL BREAK)
DOBBS: New York City is facing a massive budget deficit and city officials have discovered a way to generate extra income. They're writing tickets for some of the most obscure infractions of obscure ordinances and the city's residents don't particularly like it. And, when New Yorkers don't like it, you hear about it. And the New York police, New York's finest -- they're on the front lines of this controversy. They've actually taken out a newspaper and a radio ad saying, "Don't blame us."
Maria Hinojosa reports.
(BEGIN VIDEOTAPE)
MARIA HINOJOSA, CNN CORRESPONDENT (voice-over): Imagine getting a summons for feeding pigeons.
UNIDENTIFIED MALE: Nobody really likes the pigeons, but they're here and I guess we have to live with them.
HINOJOSA: Or for taking up two seats on the subway.
UNIDENTIFIED MALE: People are tired and they want to stretch out. There are seats and they want to relax.
HINOJOSA: Yolanda Rodin's (ph) restaurant got five tickets.
UNIDENTIFIED FEMALE: This ticket doesn't cost less than $150.
HINOJOSA (on camera): You're telling me you got $150 ticket because the curtains . . .
UNIDENTIFIED FEMALE: Yes, I did.
HINOJOSA: . . . were drawn? And you got another $150 ticket because your restaurant was closed at 5:15 in the morning?
UNIDENTIFIED FEMALE: Yes.
HINOJOSA (voice-over): Michael Barkley (ph) can relate. He got a ticket for displaying a faded registration sticker.
UNIDENTIFIED MALE: I feel frustrated. They say you can't fight City Hall and basically, I'm going to because I'm not paying it.
HINOJOSA: Then there's the pregnant teenager on the cover of the "Daily News," ticketed for sitting on the subway steps.
UNIDENTIFIED FEMALE: I told him, like, I'm pregnant because my back hurts. And I was like, I was carrying a lot of stuff. I just sat there for a second. She goes, well, you can't sit there.
HINOJOSA: City newspapers are in a feeding frenzy about what one calls the "summer of citations."
PAT LYNCH, PATOLMEN'S BENEVOLENT ASSN.: City Hall has turned the New York City police department into a revenue-generating agency rather than a policing agency.
HINOJOSA: One man was fined because the awning of his store was too wordy.
UNIDENTIFIED MALE: I cannot change the law. This is city law. We need the business. We need to fix.
HINOJOSA: Another got a ticket for sitting on a milk crate.
UNIDENTIFIED MALE: They should have told me (UNINTELLIGIBLE) too. Why did he have to give me a ticket?
HINOJOSA: In that case, police say they were trying to clear a dangerous corner. But the mayor says the silly summons uproar was manufactured by the tabloids.
MICHAEL BLOOMBERG, MAYOR OF NEW YORK CITY: I think it's time to get on with it. The fact of the matter is the police are doing a great job at keeping the quality of life in this city where we want it, and if occasionally there is a ticket that doesn't make a lot of sense, maybe in the case of the mom to-be, it's a shame that that happened.
HINOJOSA: Some residents say this is all about making money for a city facing a nearly $4 billion deficit. UNIDENTIFIED MALE: The city needs the revenue. I think that's the bottom line. It's a matter of revenue, and I think we're dealing with the letter of the law this time around. Not really the spirit of the law.
HINOJOSA (on camera): Next year's city budget already includes a projected $130 million more from tickets and fines, but the mayor's office insist that more money doesn't mean more fines, it's just that they've gotten more expensive. It used to cost you $25 to be a litterbug in New York. Now it'll cost you double.
Maria Hinojosa, CNN, New York.
(END VIDEOTAPE)
DOBBS: And another outrage in New York, this one at "The Times." "The New York Times" has accepted the resignation of Pulitzer prize- winning reporter Rick Bragg. Bragg said he resigned because of a noxious atmosphere at the times in the wake of the Jayson Blair scandal. The revelation that Blair fabricated details in dozens of reports sparked a widespread investigation at the newspaper.
Peter Viles reports.
(BEGIN VIDEOTAPE)
PETER VILES, CNNfn CORRESPONDENT (voice-over): Jayson Blair is long gone, but the Blair scandal at "The New York Times" is alive and kicking, kicking "The Times" right in the reputation. Now "Times" columnist Maureen Dowd under fire for editing the president's words to change their meaning.
Two weeks ago she quoted him saying of al Qaeda, "They're not a problem anymore."
But that's not exactly what he said. He said, "Right now, about half of all the top al Qaeda operatives are either jailed or dead. In either case, they're not a problem any more."
The Dowd deletion drew immediate criticism.
ZEV CHAFETS, NY DAILY NEWS COLUMNIST: I didn't understand why she had done it. I mean, I thought it was intellectually dishonest.
CLAY WATERS, TIMESWATCH.ORG: I think it was very dishonest. She purposely deleted (ph) a full sentence from a Bush quote just to make him look kind of naive with the war on terrorism.
VILES: Editing quotes is a common practice, but not when the goal is to change their meaning.
CARYL RIVERS, JOURNALISM PROF., BOSTON UNIV: It's certainly permissible to take a part of a quote. But one of the things you have to be careful when you take a part of a quote is that you're not missing the context or distorting the quote. VILES: "The Times" originally said it was looking into the issue, but then Dowd this week ran a second column containing the entire quote from the president and now, "The Times" says the matter is closed.
So, too, the matter and "The Times" career of star writer Rick Bragg. He quit the paper this week, after his colleagues attacked him in public for allegedly relying too heavily on the work of stringers.
UNIDENTIFIED MALE: It's unprecedented. There does seem to be a poisonous atmosphere at "The Times."
VILES: You may not recognize his name but probably remember some of the stories, including his memorable tale of Osceola McCarty, the 87-year-old Mississippi woman who saved up $150,000 by washing clothes and then gave all that money to a small college.
(END VIDEOTAPE)
VILES: Back to the Maureen Dowd issue. Her column, nationally syndicated in one fewer paper effective tomorrow. "The Lufkin Daily News," Lufkin, Texas, will tell its readers tomorrow morning that she is -- quote -- "no longer wanted" -- in the pages of that newspaper -- Lou.
DOBBS: And, Maureen Dowd printed the entire quote without the ellipsis. How -- did "The Times" comment on why that is restorative or remedial?
VILES: They did not. There was no editor's note. There was no explanation. And this is a newspaper that takes great pains to explain all the back and forth in its reporting to cover its tracks a lot. It's unusual that they would revisit an issue without telling its readers that they were revisiting an issue. We asked about that, they said the matter is closed.
DOBBS: All right. And closed, unfortunately, as well for Rick Bragg. That is, if I may say -- that's just a crazy ending to a very talented person's career. Thank you very much. Peter Viles.
Media watchdog Howard Kurtz from "The Washington Post" will join us on more on "The New York Times" scandal and the scrutiny of the media later in this broadcast.
That brings us to our "Thought of the Day" and that thought is: "The truth is rarely pure and never simple," author and playwright Oscar Wilde.
Checking now on the trade deficit, it stands at more than $207 billion. At this rate, the trade deficit will top half a trillion by the end of the year.
Still ahead, as I said, Howard Kurtz, media writer "The Washington Post."
And money manager Harvey Eisen of Bedford Oak Advisers. He says the bear market's over and he'll be here to tell us all how we can make a great deal of money in this market.
And a spell binding drama in Washington, D.C., the national spelling bee. Nothing quite like it. We love it. We think you will too, and we'll have the results. And a tough word or two. So get ready.
We're coming back.
(COMMERCIAL BREAK)
DOBBS: Joining me now, "Washington Post" writer Howard Kurtz. He's also the host of our "RELIABLE SOURCES" broadcast on CNN and joins us from Washington, D.C.
Good to have you with us.
HOWARD KURTZ, "WASHINGTON POST": Thanks.
DOBBS: This is reaching proportions of absurdity at "The Times" that I think are remarkable. Can -- can you figure this thing out?
KURTZ: Well, you have a lot of pent-up anger. I have talked to many people in the newsroom in the last couple of days who are just seething with resentment, both at Rick Bragg, the latest reporter to resign over not crediting a stringer, and its senior editors who some people believe allowed a system to fester, where at least some reporters, Bragg being the most prominent, you know, often relied on others who didn't get credit to do their own reporting even on feature stories opposed to, you know, breaking news, where you have to parachute into a city under a tight deadline.
DOBBS: Now, Rick Bragg, as, I think, most people know, a Pulitzer prize-winning journalist, a wonderful writer, a terrific author. Did he really do something that is so at odds with the craft that is not crediting a stringer? Don't other reporters, as he said, do the same thing?
KURTZ: It is certainly true that "The New York Times" and some other paper have a well established army of stringers and researcher and interns who often do a lot of the scut (ph) work of journalism and don't get credit particularly at "The Times."
Bragg told me that he -- that this was no secret, that the editors knew what he was doing, that that's what they want national correspondent to do. Well, those remarks, his aggressive defense of the story for which he received a two-week suspension, later leading to his resignation, just touched off a firestorm of anger among other national correspondents who say that they almost never use stringers except in the most tight circumstances. And if they were going to do a story about a bunch of struggling oystermen in Florida going out on a boat, they'd go out on the boat themselves rather than send the stringer.
I think here, what you have here, Lou, is that in the wake of the Jayson Blair fabrication scandal, it suddenly is a heightened scrutinized of atmosphere, poisonous atmosphere as Rick Bragg put it to me. And the place just seems to be in revolt and things that once might have been considered a slap on the wrist now are getting, you know, lots of news coverage.
DOBBS: Maureen Dowd, again, another Pulitzer Prize winner, very popular columnist, the use of her ellipsis -- and you are not only a media writer, host of "RELIABLE SOURCES," but media savant and watchdogs, I'm going to put you on the spot. Is what she did -- because it did change the meaning of what the president said in that deleted quote -- put that in some perspective for us. How serious an offense is that?
KURTZ: It's pretty minor, in my view. Columnists always deal with compression. I've put ellipsis in quotes plenty of times to save space. I think she probably shouldn't have done it because it does slightly change the meaning. I think it was not the best judgment that she's ever exercised.
But at the same time, if the newsroom wasn't reeling from the revelation that a reporter had fabricated or plagiarized or made up 36 stories, talking here about Jayson Blair, and the Rick Bragg controversy as well, then we probably wouldn't even be talking about this.
I think "The New York Times" is a great newspaper, but clearly under editor Howell Raines there has been a lot of pent-up resentment, as I said earlier, about the way the place is run. So to some extent, people who there who've been unhappy for a while, some people have left, are using these controversies as an outlet or vehicle or newspeg, as we say in the business, to vent their displeasure at the way "The New York Times" is run.
I've never seen anything like this. That newsroom is, as one correspondent told me today, is in a state of open revolt.
DOBBS: And Rick Bragg, is he a victim of this noxious atmosphere, this revolt in the newsroom, as you put it, because he is closely aligned with Howell Raines, the executive editor?
KURTZ: Well, Bragg certainly believes that. He's a long-time favorite of Howell Raines. There have been a number of people at the paper who haven't liked him. And I think that, although in retrospect, I think it was probably not the best idea to send a stringer out onto an oyster boat for four days and then write the story yourself giving the impression that you're there -- this all comes down to truth in packaging, Lou.
I do think that, if it wasn't for the current atmosphere, after all, that the story was written a year ago, Rick Bragg would still be working at "The New York Times" today. He feels bruised. People are mad at him. He told me he resigned because he didn't want to cause any more hurt feelings at the paper.
But on the other hand, an awful lot of people at "The New York Times" who work hard every day, who try to adhere to the highest standards, and they feel like they've been unfairly maligned by these two episodes. And I have some sympathy with them as well. DOBBS: And certainly "The New York Times" along with as your publication, "The Washington Post" and "The Wall Street Journal," the three leading national newspapers, some people have suggested this opens up a broader attack on the media. To me it seems this is purely a -- a "New York Times" problem. It is remarkable, it seems to me, and I don't see any analog anywhere else in the media.
KURTZ: The fact is a lot of other major news organizations have had similar problems. You can go back to 1981 and the Janet Cooke embarrassment here at "The Washington Post, Steven Glass at "The New Republic," couple of "Boston Globe" columnists. The list goes on. Photographer at "The L.A. Times" who faked a picture during the Iraq war.
All of these things, together with these problems at "The New York Times," add up to kind of a drip, drip, drip. A corrosive effect. I think, on the public's view on us in the media. And that, overall, is the kind of problem -- credibility problem, I think, that goes well beyond the specifics of one or two bad apples in the barrel on West 43rd Street.
DOBBS: What happens at "The New York Times"?
KURTZ: I think "The Times" will survive this, but I do think that, you know, they've got a committee that's going to come up with some management reforms. They probably need to do a better job of crediting stringers and interns who do some of the hard work but never get any recognition within the paper. I think eventually they'll put this behind them.
But I do think they haven't done a very effective job just handling the PR here, Lou. Senior editors have not given interviews in recent days. If a major corporation did this "The Times" editorial page would be all over them. And I think, you know, any institution should be under scrutiny, should be held to respond in the press.
DOBBS: Hardly what you would call professional courtesy on the part of "The New York Times."
And of course we've left out the political dynamic of this, "The New York Times," the leading liberal newspaper in the country. Conservatives are having a field day. How is that contributing to this controversy?
KURTZ: Well conservatives have beaten up on "The Times" for a long time. And in fact, when Howell Raines took over as editor, he had been, as you know, the editor of the very liberal editorial page. And there was a lot of talk about would he push the news coverage in a leftward direction? Some conservatives believed he has.
It's kind of ironic that that has ended up not being the major controversy of Raines' tenure. Instead, the way the kind of autocratic way, the bulldozer management style in which he runs the newsroom has -- now has him being blamed, unfairly perhaps in part in the Jayson Blair case since he was lied to and deceived just as other editors were, though there were warning signs in that case. A little more legitimate criticism, I think, in the Rick Bragg case because some of Bragg's colleagues have raised questions in the past about his reporting style.
So the ideology here is a factor. And as you say, conservative critics who don't much care for "The New York Times," they are enjoying this.
DOBBS: Howard Kurtz, we enjoyed having you with us tonight. Thank you very much, Howard Kurtz, "the Washington Post," host of "RELIABLE SOURCES."
Turning now to the markets, blue chip stocks down today, but the market finished mixed. It's on the verge of its third straight winning month, in fact. The Dow down 82 points. The Nasdaq up 12 points. The S&P 500 down 3.5 points. Christine Romans here with the mixed market.
CHRISTINE ROMANS, CNNfn CORRESPONDENT: A mixed market. The Nasdaq at another 11 month high. For the Dow, it was the first down day, Lou, in six days. And the volume picked up today, best volume in a couple of months, 1.6 billion shares of the Big Board. And much of that volume, a billion of that, coming at lower prices.
Still more issues rose than fell on the Big Board. And 163 stocks hit new 52 week highs. The Dow still on track for a 3 percent gain for May and the first stretch of three winning months in a row since late 2001.
After the bell, Microsoft is down slightly. AOL is up. Here's why. Microsoft agreed today to pay AOL Time Warner $750 million to settle claims that Microsoft unfairly used its dominance to cripple Netscape, which is now a part of AOL Time Warner. Also, AOL can use Microsoft's Internet Explorer on its service with no royalties, and the two pledged to make their instant messaging systems work better together.
Also, Lou, the latest on the campaign that's being called "Come Home America." Ingersoll-Rand will stay in Bermuda, were it avoids millions of dollars in taxes. Forty-one percent of its shareholders voted to return to the United States, but that wasn't enough -- Lou.
DOBBS: Here we go. This is going to be an increasingly large issue. Christine, thanks a lot. Christine Romans.
We'll have much more on the market. In just a few moments, we'll be talking with market seer and manager Harvey Eisen.
But first, our nightly check of the national debt. It stands now at almost $6,600,000,000 and rising, of course.
A reminder to vote in our poll. The question, do you believe the federal government should play a larger roll in the nation's health care system? Yes, no, or what health care system? Cast your vote at cnn.com/moneyline. We'll have the preliminary results coming up in the broadcast. When we do continue, we'll be talking with the leading money manager about his investment strategies and find out whether it's really time to breathe a sigh of relief at the demise of the bear market. We'll be joined by Harvey Eisen, chairman, CEO of Bedford Oak Advisers next.
And it had been a century of Hope. Legendary entertainer Bob Hope turns 100. We'll take a look at his career, his incomparable contribution to our troops abroad in times of war. Stay with us.
(COMMERCIAL BREAK)
DOBBS: Well, despite a mixed day today on Wall Street, the unmistakable trend has been positive over recent months. Here to discuss strategy for managing your money is Howard Eisen. He is chairman, CEO of Bedford Oak Advisors.
Howard, great to have you here.
HOWARD EISEN, CHMN. & CEO, BEDFORD OAK ADVISORS: Thanks, Lou.
DOBBS: A mixed market today but up strongly year to date. More of the same to come?
EISEN: I think so.
DOBBS: And we start with how much more?
We'll start with that question.
EISEN: Well, I was told the last time I was here last July, when I told you the market bottomed, and told you the market test in October and the market tested in March. We have put in a major bottom. We have had a 3 1/2 year bear market. The bear market is over, and all you have to think about is if you have question is does George Bush like living in the White House -- Lou.
DOBBS: And the answer being, stimulate that economy?
EISEN: That guy loves it and pulled out every stop. He's got rates at 45-year low. He's got Greenspan eating out of his hand. He's got Snowe pounding the tax thing through. He's got the dollar in the tank so U.S. goods are attractive. I mean, it's all teed up.
DOBBS: And within all of this, this is a nice positive bright atmosphere.
Are there any negatives?
Is there any risk for investors here?
EISEN: Sure. What are you kidding? You could wake up tomorrow and there could be something that happened two years ago on 9/11. We have got this SARS problem, which is terrifying to people. You've got world that's a hot bed of activity. You could wake up and have another problem. But X that, which none of us know. X that, the economy is going to do better. The markets are going to do better. The key is it's the third year of the presidential cycle. I mean, look, history tells you never had a down third year of a presidential cycle, so the market is fine. However, short term, it's very overbought and you are going to have a correction.
DOBBS: Right. We're up 17 percent so far from the beginning of the year on the Nasdaq.
EISEN: Right.
DOBBS: That's pretty strong. What do you expect to happen?
EISEN: Well, the market bottomed as you know in early March right before the war. We've had this big rally. The rally's over. It may continue for a couple of more days or weeks, but bottom line, you have the meat of the move. You should have a slow down. All the negative news come out. You talked about earlier with unemployment not improving. The bottom line is, pull backs now are buys.
DOBBS: And, what would you be buying?
EISEN: Well, you and I have talked about this. You can buy high quality companies. I remember talking about AOL-TIME Warner company I think you're somewhat familiar with.
DOBBS: Yes.
EISEN: At 40, 30, 20 and 10. I finally got it right.
So, what would you be buying?
I think you buy high-quality companies. I think you do the same thing you've always done. I think you go for quality. I think you go with companies with a management. Look, best example is look at company like CitiCorp. This change in the tax law dividends is a big, big deal.
DOBBS: What else besides Citigroup?
EISEN: I think financials are great. I love Jamie Diamond at Bank One. I love Washington Mutual. The big pharma companies are backing down again. I mean, you and me are the fastest growing part of the population. That's the trouble we're in and taking more pills, buddy.
DOBBS: Exactly. Within the pharmaceutical, what's the most attractive?
EISEN: I love a company called WebMD which is the way to play healthcare through the Internet. It is the greatest way to cut costs in a bureaucratic system. You just had this survey saying and people said what healthcare system? It's because of the cost. We have great healthcare, but you just have to cut the cost.
DOBBS: And it has been rising 17 percent over the past year.
EISEN: Unbelievable.
DOBBS: In what Greenspan suggested a -- let me rephrase that. A falling -- the prospect of falling inflation is a concern.
EISEN: What a bunch of nonsense. Can you even imagine.
DOBBS: Frankly, since you ask, Harvey, no, I can't. But I can always say, thank you very much for you taking time to share your wisdom with us here. We appreciate it.
EISEN: Times are going to get better, Lou.
DOBBS: I love it.
EISEN: We're OK.
DOBBS: All right. Harvey Eisen. Thank you.
EISEN: Good to see you.
DOBBS: We have a winner from the Scripps Howard National Spelling Bee.
(BEGIN VIDEO CLIP)
SAI GUNTURI, SPELLING BEE CHAMPION: Pococurante, P-o-c-o-c-u-r- a-n-t-e, pococurante.
UNIDENTIFIED FEMALE: He is the champion.
(END VIDEO CLIP)
DOBBS: The winner is Sai Gunturi, a 13-year-old eight grader from Dallas, Texas. One of 251 boys and girls that began that competition yesterday. Sai, will collect $12,000 and some other prizes for his victory. By the way, the winning word means not concerned, indifferent nonchalant. Our congratulations to the winner. All the kids involved in the spelling bee and to Scripps Howard for a terrific contest.
From the national contest to a national treasure, Bob Hope celebrating his 100th birthday. His career spanned vaudeville, radio, movie television. His most important contribution to many may be the USO shows abroad. He took his show and groups, of willing entertainers on the road to entertain soldiers from World War II though Operation Desert Storm. He is the only American civilian ever to be named honorary veteran of the United States armed forces.
When we continue we'll share some of your thoughts about the tax cuts, the trade deficit and a whole lot more. We'll have the important preliminary results of tonight's poll. Stay with us.
(COMMERCIAL BREAK)
DOBBS: The preliminary results of our poll, "Do you believe the federal government should play a bigger role in the nation's healthcare system?"
52 percent say yes, 15 percent said no, 33 percent said what healthcare system?
Let's take a look at some of your thoughts.
Ralph Mills, of Rancho Palos Verdes, California. "I am less concerned about whether the tax cut is just right, or not, for me, and more concerned about how my children and grandchildren will pay the whopping and growing national debt. And now I'm going to pay my growing state and local taxes that we are inheriting, in part, from Washington."
Well, last night's poll question about the tax cut, Robert Intriago, El Dorado Hills, California, said, "I was surprised to see that 42 percent the respondents believed it was 'too much.' My question is: of those who believe that the tax cuts are too much, how many plan to return the money to the treasury?"
On the road map to peace, Henry Weiler, of Bethesda, Maryland, said, "Lou, you seem to believe Ariel Sharon about ending the occupation. That's great. Now I know I can interest you in a real deal on some ocean front property in Idaho!"
Well, Idaho is lovely state, and I am always interested. We appreciate hearing from you. Send us your e-mail at loudobbs@cnn.com. Thanks fro being with us tonight. For all us here, good night from New York.
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