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Social Security Battle; Iraq's Most Wanted; Syrian Troops Quit

Aired April 26, 2005 - 18:00   ET


LOU DOBBS, CNN ANCHOR: Tonight, the battle over so-called Social Security reform has escalated. The Senate Finance Committee considering President Bush's plan for Social Security reform. My guest, the committee's chairman and ranking Democrat.
Securing our borders. Immigration reform groups go to Capitol Hill today, fighting for strict border security and tighter immigration laws. Tonight, a Latino-American woman who's helping lead that fight for border security and immigration reform. She's our guest.

And investors against outsourcing. The rising backlash by investors against the export of American jobs to cheap overseas labor markets.

ANNOUNCER: This is LOU DOBBS, for news, debate and opinion, tonight.

DOBBS: Good evening.

The battle over the president's plan for so-called Social Security reform today entered a new and critical phase. President Bush traveled to Galveston, Texas, to sell his Social Security proposals amid new poll numbers that suggest his plan is losing voter support. At the same time, the Senate Finance Committee started deliberating on the reforms for the first time.

Judy Woodruff has the report.


SEN. DICK DURBIN (D), ILLINOIS: Do you want to turn your retirement security over to Wall Street?


JUDY WOODRUFF, CNN CORRESPONDENT (voice-over): Outside, dissent dominated, but inside, decorum prevailed.

SEN. CHARLES GRASSLEY (R), CHAIRMAN, FINANCE COMMITTEE: If there is going to be a bipartisan consensus for reform, the process has to begin in this committee.

WOODRUFF: As the Senate Finance Committee, guided by the steady hand of Iowa senator Chuck Grassley, began to tackle an overhaul of Social Security, the tone was collegial. UNIDENTIFIED MALE: The cooperation is so great it's turned into personal friendship.

WOODRUFF: The matter pressing.

GRASSLEY: The longer Social Security's future -- that future remains in doubt, the more people will worry about their own future prospects.

WOODRUFF: Senators agree on the problem. Eventually, Social Security won't be able to maintain solvency. In other words, the amount of money coming into the system won't be enough to pay out benefits that have been promised.

UNIDENTIFIED MALE: My grandchildren are going to be stuck with the bill. They either going to have their benefits cut or they're going to pay a whole lot more. Now, that is wrong.

WOODRUFF: Consensus on a solution, however, is a long way off. Members of Congress are sharply divided over President Bush's proposal for individual retirement accounts, allowing workers to invest some of their Social Security taxes in stocks and bonds. Democrats say they would just dig the hole deeper.

UNIDENTIFIED MALE: Where does the money come from to put into these private accounts? Where does that money come from? Well, the federal government would have to borrow it.

WOODRUFF: Senate Republicans, meanwhile, divided themselves, are handling the accounts like a hot potato. Polls showed the president's plan not a big hit and GOP senators, including Chairman Grassley, have indicated it is not a top priority.

Judy Woodruff, CNN, reporting.


DOBBS: President Bush today declared that now is the time for Congress to set aside political differences and fix the problems with Social Security. The president said the current Social Security system will not work for younger Americans.

Andrea Koppel reports from the White House.


ANDREA KOPPEL, CNN STATE DEPT. CORRESPONDENT (voice-over): In the final week of a 60-day nationwide push to sell his ideas to reform Social Security...

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: I've been to 23 states explaining the problem.

KOPPEL: ... the president again sought to reassure a powerful voting bloc.

BUSH: If you've retired, if you were born prior to 1950, the system will take care of you.

KOPPEL: But Mr. Bush's proposal to give younger workers the option to create private investment accounts funded with Social Security payroll taxes remains a nonstarter for Democrats, who gathered on Capitol Hill to show their resolve.


KOPPEL: And a new ABC News-"Washington Post" poll shows the president clearly has a tough road ahead. Sixty-four percent now disapprove of Mr. Bush's handling of Social Security reform, while only 45 percent support the president's ideas, down 11 percent in the last month alone.

STU ROTHENBERG, POLITICAL ANALYST: The bottom line on it is, though, the president is no better off now on Social Security reform than when he first introduced the idea. And, in fact, I'd argue he's worse off because he at least he had a time to sell it and he didn't. That's not good news.

KOPPEL (on camera): But preferring to see the glass as half full, the White House says the goal of this initial phase was to get out the word on the need to reform Social Security, something it believes it's accomplished. The challenge? To convince more Americans the president's ideas are the best way to do that.

Andrea Koppel, CNN, the White House.


DOBBS: Well, first, the U.S. Senate has to be convinced. And my guest later here will be Finance Committee Chairman Senator Charles Grassley and the ranking Democrat, Senator Max Baucus.

Well, at the Pentagon today, the chairman of the Joint Chiefs of Staff, General Richard Myers, today insisted the United States is winning the war in Iraq. But General Myers acknowledges the number of insurgent attacks has increased. Pentagon officials said U.S. troops recently came close to capturing al Qaeda's leader in Iraq as well.

Our senior Pentagon correspondent, Jamie McIntyre, with the story.


JAMIE MCINTYRE, CNN SR. PENTAGON CORRESPONDENT (voice-over): CNN has learned that these pictures of most wanted terrorist Abu Musab al- Zarqawi first broadcast by CNN last month came from a computer recovered in February by a U.S. special operations taskforce that nearly got Zarqawi himself.

GEN. RICHARD MYERS, JOINT CHIEFS OF STAFF: We were close. And if you go much further into this, then you get into some of the operational methods, which we can't discuss.

MCINTYRE: But officials do tell CNN the U.S. was tipped off that Zarqawi was on his way to a meeting in Ramadi on February 20. His vehicle was under aerial surveillance from a Predator spy plane, and checkpoints on the ground were set up to capture him.

After his truck turned to avoid a checkpoint, U.S. commandos ran it down, only to find that Zarqawi apparently escaped. Two men, Zarqawi's driver and security guard, were seized, along with Zarqawi's computer, said to contain a treasure trove of intelligence, including evidence which U.S. officials say reinforces the belief Zarqawi and Osama bin Laden are cooperating on some level.

DONALD RUMSFELD, DEFENSE SECRETARY: Maybe people, maybe money, maybe communications. Maybe an oath of allegiance. Who knows.

MYERS: Instructions.

RUMSFELD: Yes. But they're probably not detailed instructions, but broad direction, yes.

MCINTYRE: Intelligence in Iraq is getting better, Rumsfeld and Myers say, citing as an example the quick roundup of 10 suspects following the shoot-down of a civilian helicopter last week. So despite a recent upsurge in deadly attacks in Iraq, the Pentagon's top general remains optimistic.

MYERS: I'm going to say this: I think we are winning. OK? I think we're definitely winning. I think we've been winning for some time.


MCINTYRE: The Pentagon admits that judging solely by the number of attacks, it appears the insurgency is about as strong as it was a year ago. But Rumsfeld and Myers insist that's the wrong measure.

They argue that Zarqawi is on the run, intelligence is getting better all the time. And that ultimately Iraq's security forces, which they now say number 159,000, will be able to defeat the insurgents -- Lou.

DOBBS: As you know and have reported extensively, Jamie, we've been reporting here for some time that the insurgents are on the run. The Pentagon, General Myers, Secretary Rumsfeld, say the insurgency is the same size as a year ago.

What in the world is the metric by which they will judge either success or failure?

MCINTYRE: Well, they still contend the insurgency is relatively small. But it can be very lethal, and its effect can be far beyond the actual numbers and damages it's able to inflict.

And they still insist that it's essentially something that the United States and coalition forces cannot defeat militarily. It's got to be defeated through the political growth and the economic growth of Iraq and the general feeling of the population. A very difficult thing to measure, and something that is just going to have to play out over time. But we continue to get the glass half full perspective from the Pentagon, while others see it as half empty.

DOBBS: Well, we, of course, would not want anything less than optimism at the Defense Department, certainly. But at the same time, the issue in the United States Marine Corps, Marines crying out, their leaders, as well, saying they have not been able to be as effective as they might, lacking proper armor and proper protection.

Any reaction from General Myers or Secretary Rumsfeld today to that issue specifically?

MCINTYRE: Well, they weren't asked about that specifically today. But generally, the Pentagon has said that the complaints that they are hearing from some of the Marines and others who have come back relate to things that have happened either weeks or months ago, or sometimes even longer than that.

They said they're continuing to address the armor situation. The personal armor situation is that soldiers and Marines have their personal body armor that they need. There's still more vehicles that could be armored. And they ultimately say that armor is not the final solution, that it's to continue to draw down the number of U.S. troops and continue to get the Iraqis to take over the mission.

That's ultimately the exit strategy and the solution to the problem.

DOBBS: There are those, of course, Jamie, as you know, who would suggest, so long as U.S. forces are in Iraq, the issue is the safety and the well -- the preparation and precautions for our men and women in uniform there, irrespective of the number.

Jamie, we thank you very much. Jamie McIntyre reporting from the Pentagon.

U.S. weapons hunters say there's no evidence conclusively that Saddam Hussein moved any weapons of mass destruction to Syria. They Iraq Survey Group report appears to contradict the assertions of some U.S. officials who had declared Iraq may have transferred some of those weapons, material to Syria.

The Survey Group completed its work in Iraq last December. The group says it has exhausted its search for weapons of mass destruction, and, of course, found none.

The last Syrian troops and intelligence agents today quit Lebanon after a three-decade occupation. Many Lebanese declared the Syrian withdrawal marking the beginning of a new era for their country. Syrian troops began their occupation of Lebanon in 1976, when they tried to end the Lebanese Civil War. That civil war ended in 1990, but the Syrian troops remained.

Our Brent Sadler reports from Lebanon. (BEGIN VIDEOTAPE)

BRENT SADLER, CNN SR. INTERNATIONAL CORRESPONDENT (voice-over): Two armies on parade for an historic day. Lebanese soldiers and the last group of departing Syrian soldiers marking this ceremonial end to 29 years of Syrian entrenchment in Lebanese life.

For weeks, the Syrians have been uprooting their troops and tanks, forced to withdraw under intense international and Lebanese pressure. It followed the February assassination of former Lebanese Prime Minister Rafik Hariri in a massive bomb blast.

(on camera): This salute to Syria seems to end one aspect of an international crisis. But it may lead to another, focusing on Lebanon's Hezbollah, staunch allies of Syria.

(voice-over): The militant group labeled terrorists by the U.S. and Israel still has weapons. It remains at the forefront of international pressure to disarm.

At the border, some Lebanese dance for joy as the Syrians officially completed their pullout.

UNIDENTIFIED MALE: The day of freedom, it's the day of sovereignty. It's the day of happiness, simply.

SADLER: A chance, it's hoped, for Lebanon to stand on its own feet and for politicians to eventually manage their own affairs if the Syrians are well and truly gone.

Brent Sadler, CNN, Beirut.


DOBBS: Up next here, immigration reform groups take the battle for tighter border security and tougher immigration laws to Capitol Hill today. We'll have the story.

And is the outsourcing bubble about to burst? The rising backlash against the export of American jobs to cheap overseas labor markets.

Those stories are next.


DOBBS: We made it something of a campaign on this broadcast to feature those corporations, U.S. corporations, that outsource jobs to cheap overseas labor markets. And as corporate America continues to outsource American middle class jobs, Wall Street's enthusiasm for outsourcing is for the first time positively on the decline. Investors are dumping shares of outsourcers and other companies that have sent jobs to those cheap labor markets.

Christine Romans has the reports.


CHRISTINE ROMANS, CNN CORRESPONDENT (voice-over): Just what is Wall Street trying to tell the executive suite? Investors are fleeing the stocks of companies that make money, shipping American jobs to cheap overseas labor markets. On Wall Street, it's called a bear market when a stock declines 20 percent. The outsourcers are in the grip of it -- Satyam, Wipro, Infosys, Cognizant.

FRANCES KARAMOUZIS, GARTNER GROUP: This brick wall has been hit because everybody outsourced the low-hanging fruit.

ROMANS: A brick wall for the Indian companies and for the American companies that so eagerly jumped on the outsourcing bandwagon, IBM, EDS and Accenture.

KARAMOUZIS: They just in some cases outsourced the problems. So just because now it's 8,000 or 10,000 miles away doesn't make it any less of a problem. In fact, it's harder to attack.

ROMANS: On top of that, major new security concerns. Employees of an Indian call center were recently busted for stealing $400,000 from Citibank customers.

The rupee is strong. Employee turnover rates approach 90 percent for some companies. And red-hot growth in this business is slowing.

JACOB KIRKEGAARD, INSTITUTE FOR INTERNATIONAL ECONOMICS: Just because something is technically feasible to outsource and have a particular task carried out in India, that by no means means that this is profitable to do so.

ROMANS: Profit fell last quarter at Tata Consultancy, India's largest outsourcing company. Infosys predicted only flat revenue for the first quarter. And Wipro profit growth has slowed.


ROMANS: The hysteria has cooled on this industry and these stocks, but that won't keep American companies from outsourcing. A lot of these analysts say they think this is a bump in the road, to use a terrible cliche. That it's just a little pullback, not necessarily a full-blown depression.

DOBBS: But your report tonight marks the first time that broadly people on Wall Street are acknowledging outsourcing is in trouble.

ROMANS: They are acknowledging it indeed. And investors seem to be betting with their pocketbooks. They are selling these stocks.

DOBBS: Unfortunately, those jobs, as you say, continue to go overseas. And again, working men and women in this country remain the victims of the practice.

Christine, thank you very much.

ROMANS: You're welcome. DOBBS: Christine Romans.

While investors appear to be turning their backs on outsourcing, venture capital investors are increasingly calling on new companies to outsource. These firms want American companies to commit to exporting a significant number of their jobs to cheap foreign labor markets before they will invest.

Bill Tucker reports.


BILL TUCKER, CNN CORRESPONDENT (voice-over): If eBay or Yahoo! or Starbucks or Federal Express were startups today, chances are a lot fewer Americans would be working for them. To start a business now, entrepreneurs better be betting big on creating a portion of their jobs offshore. Currently, about half of the startups generate jobs outside of the United States. It's widely expected that soon the number will be 90 percent.

MARK HEESEN, NATIONAL VENTURE CAPITAL ASSOCIATION: It is a global international economy. And if you don't as a businessman understand that from a venture capitalist perspective, you're simply not going to get funded

TUCKER: Venture capitalists say what's going on is a radical transformation of the business model made possible by technology.

SAM JADALLAH, MOHR DAVIDOW VENTURES: What happened is that the cost of the bandwidth or cost of connectivity now has dropped so low that it's very easy for people to have near-free phone calls with each other on a daily basis. They can now do conference calling and have virtual meetings over the Internet.

TUCKER: Multiple people can work together in multiple countries. What this means is jobs no longer have an allegiance to people or a country, but to the place which gives them the most advantages in terms of cost in order to create a better return on investment.

MARCUS COURTNEY, WASHTECH: Companies don't only have a responsibility to their shareholders, they have a responsibility to the community, to their employees, as well as to their country that is helping provide that opportunity to balance the interest.

TUCKER: Right now, those scales are tipped firmly in the direction of the venture capitalists who hold the money.


TUCKER: Now, the reason this issue is so important is that small businesses are the driver of job creation, our economy, not large corporations. If those businesses must now ship their job growth overseas, well, Lou, it threatens the economy at its very base.

DOBBS: It's been threatening the economy throughout and at its base, as you say. And that's a great point. Many people do not realize that despite all of the focus on multinationals, the large corporations, that 80 percent of the jobs created in this country are created by small business. And now if the venture capitalists have joined this and have the temerity, the hubris to demand that these startups in which they have enough faith to invest send those jobs over, I mean, this is an absurdity.

TUCKER: They want the lower cost. They want to reduce their risk. They want to increase the returns. That's what it takes to get it, that's what they are going to demand for it.

DOBBS: And working Americans be damned.

TUCKER: That's right.

DOBBS: Bill Tucker, thank you very much.

Up next here, hundreds of protesters going to Washington. They are there to demand tighter border security, tougher immigration laws. Later, I'll be joined by one immigration expert who debunks the notion, as many have suggested illegal aliens will actually help save our Social Security system.

Stay with us.


DOBBS: A rally this week in Washington is aimed at drawing attention to the rising illegal alien crisis in this country. The group says their message is simple: secure our borders and secure them now.

Lisa Sylvester reports from Washington.


LISA SYLVESTER, CNN CORRESPONDENT (voice-over): Their message is simple. But immigration reform groups say Washington's leaders have not been listening. So now more than 400 people from all over the country traveled to D.C. to rally for change.

TERRY ANDERSON, RADIO HOST: Eighty percent-plus of the American people over and over and over have said we want the borders closed.

SYLVESTER: The group includes 18 talk radio hosts who took their shows on the road, broadcasting from a Washington hotel.

ROGER HEDGECOCK, RADIO HOST: Homeland security is a hoax if we don't have border security.

SYLVESTER: San Diego's Roger Hedgecock has a message for lawmakers. He's holding their feet to the fire.

HEDGECOCK: Secure the border first. Secure the border now. The Minutemen have shown it can be done with guys with folding chairs, binoculars and cell phones SYLVESTER: The Minutemen are also in Washington this week after their highly visible patrol of the Arizona border.

CHRIS SIMCOX, THE MINUTEMAN PROJECT: With the reports of the 9/11 Commission, the reports from the FBI, the CIA, all of our national security organizations admit that even now, three years after September 11, the greatest threat to our national security is the border with Mexico.

SYLVESTER: Dennis Snyder brought students from his California Charter School to lobby Congress. He says the growing illegal population is draining state resources.

DENNIS SNYDER, ESCONDIDO CHARTER HIGH SCHOOL: Obviously the taxpayers pay for our public education. And so all the influx of illegal aliens and students that are affecting our schools, which causes the taxpayers to build more schools.

SYLVESTER: Supporters of a tight U.S. border are growing in number and becoming more organized, a point they hope Washington begins to notice.


SYLVESTER: Radio host Roger Hedgecock has been bringing groups to Washington for more than a decade now to lobby lawmakers. And they usually average about 100 people or so. But this time the group is four times that size -- Lou.

DOBBS: And any sign that people there in Washington paying attention this time?

SYLVESTER: Well, one of the main things that they were lobbying for is Real ID. As you know, that's one of the current issues being debated in Congress right now. And they are hoping that the timing of their visit will perhaps be able to sway the debate over to their side -- Lou.

DOBBS: Absolutely. Lisa Sylvester, thank you.

More on the immigration crisis coming up next. A new study that contradicts what is a popular misconception among some in corporate America about illegal immigration and the impact on our workforce, Social Security and more.

Also ahead, I'll be talking with a Latino-American woman who is fighting to stop illegal aliens from crossing our borders. She says the fight has nothing to do with race.

And the escalating battle over Social Security. The two senators leading the debate are my guests.

All of that and a great deal more still ahead here.

(COMMERCIAL BREAK) DOBBS: In a moment here, I'll be talking with the author of a new study challenging the theory that immigrants and illegal aliens can actually help save Social Security in this country. But first, here are some of the other important stories tonight.

The woman who was arrested after she claimed she bit into a human finger in a bowl of Wendy's chili today agreed to return to California to face charges. Anna Ayala is charged with attempted grand larceny for what police now say was an outright hoax. Ayala faces up to seven years in prison if she's found guilty.

More finger pointing tonight, this time in Ohio, where a man is suing the owner of an Arby's franchise for $50,000. David Sheiding says he found a slice of skin from a fingertip in his chicken sandwich at Arby's. This claim apparently has some merit.

The manager of the restaurant admits he cut his finger slicing lettuce. This all happened in, of all places Tipp City, Ohio.

And in Florida today, Governor Jeb Bush signed into law the so- called Castle Doctrine. That measure allows people in public places to meet force with force and shoot would-be attackers without fear of prosecution. Twenty-four states already have a similar law now in place.

A new study out today examines the effect of immigrants and illegal aliens on our society. In particular, that study challenges a notion that is popular among some businesses that the two groups will actually solve the problem of our aging nation.

We asked the director of the study to solely analyze the impact of illegal aliens on our workforce and on our Social Security system.

Steven Camarota the director of research at the Center for Immigration Studies joining us tonight from Washington.

Good to have you with us.


DOBBS: Steve, like you, and I'm sure others, I've heard many CEOs and the heads of business associations in this country, including the U.S. Chamber of Commerce, suggest that illegal aliens are actually a great idea for the country because that's one solution to an aging population and the burden they place on our Social Security system. What did your study find?

CAMAROTA: That that is just not the case. If you look at the U.S. population, what share is working age, say, age 15 to 64, and then you pull out the roughly five or six million illegal aliens who are in the workforce, it turns out that the share is exactly the same with or without illegal aliens. They make up such a tiny fraction of the total population, even though obviously their numbers are very large overall, but that they make up a tiny fraction of the overall U.S. population that their presence in the United States doesn't really make us a more youthful society.

DOBBS: A more youthful society, but use the number 20. Bear Stearns is, I think you know, estimates the number of illegal aliens in this country to be as high as 20 million. What impact would that have on your findings?

CAMAROTA: Well, obviously, we find, like most researchers, that the numbers is more like 10 or 11 million illegal aliens. And if that number is correct, which I think it is, then the impact is trivial.

Put it this way: 66 percent of the U.S. population is of working age when you count the illegal aliens. If you pulled out all the illegal aliens, it would still be exactly the same at 66 percent, partly because a lot of illegal aliens are not actually of working age. Some are too old, some are too young and some aren't in the workforce I should point out as well.

DOBBS: Let's turn to the issue of totalization. President Bush's administration negotiating a totalization agreement with Mexico, which would allow those Mexican citizens who have worked in this country illegally to draw U.S. Social Security benefits. What is your judgment of the impact?

CAMAROTA: This is a very problematic agreement. Literally, this is the case -- I know it may sound unbelievable -- but an illegal alien who works in the United States with a false identity, a stolen identity and only for up -- and as little as 18 months, will then be able to return to Mexico, and if he paid any Social Security taxes, he will actually be able to collect a minimal payment from American taxpayers, even though he was in the United States illegally, even though it was -- he was working with a stolen identity. That is what this agreement will allow.

It's an enormous problem, because we obviously have about four or five million illegal aliens from Mexico in the United States working. Allowing them to take Social Security would create a huge drain on the system.

DOBBS: Well, Steve, let's boil that down. You said a minimal payment and a payment that would be available to an illegal alien and resident of Mexico within 18 months. What is a minimal payment?

CAMAROTA: Oh, well that -- if a person only worked in the United States for 18 months, then their monthly payment might be only $100 or $200. But if that person manages to work in the United States for the full 10 years, and there's an incentive to do that, that he would be fully invested in the U.S. Social Security system, and under this agreement that illegal alien would be able to collect fully the same benefit that an American would be able to collect who made the same wages.

What is even more -- let me just tell you one thing. What is even more outrageous about this deal, if you're an American in Mexico, you have to work for 24 years to be fully vested in the Mexican Social Security system, and it isn't even as generous as ours. In other words, an illegal alien can work here 10 years and get full Social Security benefits from American taxpayers. But an American working in Mexico legally would take 24 years he would have to work to get those full benefits. And that's the deal that President Bush has worked out with Vicente Fox.

DOBBS: In the example you are talking about, a quid pro quo, an American in Mexico, how long must a Mexican citizen work to bring back the benefits of a Mexican Social Security payment?

CAMAROTA: Right, well, that's one of the things that makes this so lopsided. Even in Mexico, a Mexican in Mexico has to work 24 years to be fully vested in the Mexican system. But if he works just a few years in the United States, he actually can begin to make claims on our system.

So what this does is create an enormous incentive for people to come and try to work in the United States illegally.

DOBBS: Steven Camarota, we thank you for being with us here tonight.

CAMAROTA: Thank you.

DOBBS: Amazing.

As we reported tonight, President Bush and Congress today were again talking Social Security reform. We want to hear from you on this issue in our poll tonight. Do you believe the president and Congress at this point should just drop the issue of Social Security? Yes or no. Cast your vote at We'll have the results later here tonight.

Our quote of the day tonight is from a Bush administration official, who today said the White House now supports attaching the Real ID Act to the emergency spending bill for the war on terror. Real ID would require proof of legal status in order to obtain a driver's license in this country. It is one of the most important issues before the Senate.

Joshua Bolton, director of the Office of Management and Budget, wrote a letter to the lawmakers leading that conference committee negotiation on the emergency supplemental. In that letter, Bolton says and we quote -- "the administration strongly urges the conferees to include the Real ID Act of 2005 in the final version of the bill. This important legislation will strengthen the ability of the United States to protect against terrorist entry and activities within the United States. In particular, the legislation tightens procedures for non-citizen entry and presence in the United States, facilitates the building of physical barriers where appropriate to protect U.S. borders, and facilitates the strengthening of state standards for the security and integrity of driver's licenses."

Hurray, Mr. President.

Well, some residents of Southern California may be wondering if Los Angeles has been officially annexed by Mexico. A billboard on an L.A. freeway now says "Los Angeles, Mexico," instead of "Los Angeles, California." The billboard is for a Spanish language newscast based in Los Angeles. Los Angeles, California, we might point out.

California hospitals are now on the verge of a financial collapse, in part because of the huge influx of illegal aliens. Last year, some California hospitals were forced to close, nine of them, primarily because that state has the highest percentage of uninsured patients in the entire nation. California officials estimate that of its seven million uninsured residents, a third, they estimate, are illegal aliens, but acknowledge that it could be higher. The hospitals are also required to implement earthquake safety measures that the Rand Corporation now estimates will cost those California hospitals $41 billion. That's more than the value of the entire California hospital system.

Drug companies are the biggest lobbyists according to a new "USA Today" report. In last year's elections, drug makers gave at least $17 million to federal candidates, including $1 million to President Bush, $500,000 to Senator John Kerry. At least 18 members of Congress received more than $100,000 apiece. The pharmaceutical industry also has a huge squad of 1,300 lobbyists, as well as private aircraft, of course, available for lawmakers' use.

Another new survey shows lawmakers have taken $16 million in privately funded trips over the past five years, according to the Political Money Line. Half of those trips were paid for by nonprofit groups that don't have to disclose who's providing the money.

The issue has come under heightened scrutiny now that funding for House Majority Leader Tom DeLay's travel has been questioned. A lot of other lawmakers are now, we're told, getting very nervous.

Coming up next -- a Latino American who says she strongly supports the president on everything except his policies on border security and illegal immigration.

And the Senate begins a battle over the future of Social Security. I'll be talking with two senators leading the debate. Coming up next. Stay with us.


DOBBS: My guest tonight is a Latino-American woman who is among those leading the fight against illegal immigration into this country. Lupe Moreno says the fight against illegal aliens is about people who are breaking the law to come to this country, not about race. Lupe Moreno is the co-founder of Latino-Americans for Immigration Reform, a volunteer for the Minuteman Project. She is in Washington, D.C., and joins us tonight. Good to have you with us.


DOBBS: OK, let me ask you, first, why is it so -- a cause for you in particular, that you are taking up the immigration reform issue in the border security issue?

MORENO: Well, for one thing, I think all these people are breaking our laws, and nobody seems to care about it. I do. I feel that my family had something to do with the start of this total destruction, of what is going on in our nation, and I feel an obligation to try to help to stop it.

DOBBS: You took part, as well -- you were a volunteer in the Minuteman Project. What was the reaction in the Latino community?

MORENO: Well, it depends on who you talk to. If you talk to American Latinos that believe in our laws, they thought it was great. A lot of them wished they could be here with us. If you talk to the radical Latinos, the ones that side with foreign nations, then they were very upset.

DOBBS: And you bring up the issue, I'm -- you would not have been in this position, but I've had certain groups call for a boycott of me and this broadcast -- Latino, open-borders activist groups, I should say -- many suggesting if, not all the way to racist, borderline racist in their judgment. How -- give us...

MORENO: They are breaking -- they are breaking our laws, Lou, and the only words that they could use, because they can't use any other words, is that we are racists. Well, we're not racists. We are standing up for what is right. We are standing up for this nation. They are standing up for foreign nations.

DOBBS: As you know, in Arizona, Proposition 200 received the support of nearly half of all Hispanic Arizonans who went to the polls. But these groups want to ignore the fact that Hispanics -- they want to attach open borders to some sort of racial issue, ignoring the fact that millions of Hispanics in this country want those borders secured. They want their families secured, and they want immigration reform to be rational and the law-breaking to quit.

MORENO: That's right.

DOBBS: Why is there such a blindness amongst some groups to that very real reality?

MORENO: Lou, I do -- I don't understand them, actually. I love this nation. This is my country. I was born here, and for people like La Raza, MALDEF and LULAC, to me these are traitor groups. I don't know where their heart is. They are very militant, very racist, because they hate America, they hate Americans, and they go around beating up poor senior citizens that only try to tell people what has been going on.

DOBBS: You know, when you say they beat up, and obviously we should -- when you say they beat up poor senior citizens, what do you mean?

MORENO: I have been doing this, fighting illegal immigration, for almost 12 years. I've been to rallies. I've been to protests. I've been to places where we tried to get our elected officials' way of thinking, trying to tell them something is wrong. We have had these groups come against us. We've had them dress up in complete black, black-hooded, up to their -- down to their shoes -- and they start fights. They start fights and they start throwing things at the seniors. They've practically spit in my face. They called me a racist more times than I can count. But you know what, it gets to the point where that word doesn't mean anything anymore. They are groups of hatred.

DOBBS: Well, unfortunately there are all sorts of small groups of hatred in this country. Luckily, they are diminished and minimized to the point of irrelevancy, at least in my judgment for all...

MORENO: Not in the Hispanic community, Lou. Not in the Hispanic community. We have real big problems that a lot of the Latino community does not want to acknowledge, but it's there, and it frightens me.

DOBBS: Well, we're going to ask to you come back to talk more about the subject. We're out of time, Lupe Moreno. We thank you for taking time to be with us here tonight. Come back soon. We wish you all the best.

MORENO: Thank you, so much.

DOBBS: "ANDERSON COOPER 360" begins at the top of the hour. Anderson Cooper with us now.

ANDERSON COOPER, HOST, "ANDERSON COOPER 360": Lou, thanks very much.

The top of the hour on 360, kids out of control in the classroom and at home. There was outrage after a kindergarten student was handcuffed by police. She was just five years old. The question is, should teachers be given more power to discipline students themselves? You're going to hear from both sides.

Plus, five tips for parents: how you can deal with your kids' tantrums. Also tonight, a murder-suicide mystery. Police say a 10- year-old boy killed his mother, then himself. Find out why a small town refuses to believe it's true. All that and more at the top of the hour. Lou?

DOBBS: Looking forward to it.

Still ahead here tonight -- the battle over Social Security, the chairman and ranking Democrat of the powerful Senate Finance Committee join me. They are going to be here to talk Social Security, so-called reform. Stay with us.


DOBBS: The powerful Senate Finance Committee today took up the issue of Social Security reform. The Chairman Charles Grassley and ranking Democrat Max Baucus told me they are making a good-faith effort at bipartisan cooperation on the issue. I asked Senator Grassley how the Senate can move ahead on this issue with survey and poll after poll showing a large majority of Americans don't want Washington touching Social Security at all.


SEN. CHARLES GRASSLEY (R), CHAIR., FINANCE COMMITTEE: Well, I think it's clear that people expect Congress to deal with at least the solvency part of Social Security. On the private and personal accounts, you know, I was hoping after 90 days of the president making this an issue, since the State of the Union message, that there would be a vast support for it. We still have several months before this is going to be before the United States Senate, and hopefully, you know, we regain some ground. But without a doubt, we have a responsibility to make sure the Social Security is solvent for our children and grandchildren.

DOBBS: As Senator Grassley says, Senator Baucus, our grandchildren are at issue here. But again, you are in support of reforming Social Security, but opposed to the private accounts and, again, the public, the people who at large elected you, gentlemen, and 98 other senators, say they don't want Social Security touched.

What's your reaction?

SEN. MAX BAUCUS (D) MONTANA: I think all members of the Senate understand that it's important to address the long-term financial challenge facing Social Security. But since the very beginning I've believed -- and your polls that you mentioned confirm this -- that it's probably not a good idea to begin by taking money away from Social Security to solve it. That is carving out the private accounts away from Social Security. And once we can put that issue aside, then get down to the main business at hand which is dealing with the long- term financial problems facing Social Security. But I think we can make some progress.

DOBBS: Senator Grassley, do you believe that President Bush has hurt his own campaign to reform Social Security which many argue of course, is unnecessary, by focusing on these first private accounts, then personal accounts, and then suggesting that Social Security would be bankrupt in less than 20 years?

GRASSLEY: I think early on, you know, maybe in the first month he did make a mistake by concentrating too much on personal accounts. But I think, you know, after I pointed that out, now it's two months ago, I think. I think they've changed their approach and they're talking about solvency as well as personal accounts. And I think that's what has brought it up on people's minds as something that Congress needs to be dealing with, at least the solvency provisions of it.

DOBBS: And Senator Baucus, as you know, there are many people who point out, that even if as some suggest Social Security were insolvent by 2042, which is a highly -- let's put it this way, equivocal number that still for 75 years the deficit would only amount to one half of one percent of our GDP. And at the same time the budget deficit for which you gentlemen and colleagues in the Senate and the House are responsible, that amounts to 3.6 percent of GDP, our trade deficit amounts to 6 percent of GDP.

Why is this in your mind so critical? BAUCUS: It's -- frankly on the table because the president has placed it there. We have in my judgment other issues that are even more critical than Social Security, because actually according to the Congressional Budget Office, the bipartisan office of the Congress, whose estimates we by law in Congress must go by, the Social Security Trust Fund is -- doesn't begin to become insolvent, the surplus doesn't begin to expire until the year 2052.

In the meantime as you said, I mean, it is amazing. We have Medicare Trust Fund due to go insolvent -- the trust fund insolvent in the year 2020, way before 2052. We have the huge fiscal deficit facing us. We have the huge current account deficit facing us. The dollar is under attack.

GRASSLEY: My feeling is that the Social Security problem is the lesser of those as you quantify them. I don't dispute what your question is. But if we can't solve a relatively smaller problem like Social Security, you know, will we ever be able to tackle those larger problems? And I see this as kind of an opportunity to do something that only a president can raise, but additionally if we can't succeed at this and take baby steps with this one, how can we take the giant steps on some of the other ones?

DOBBS: Well, Chairman Grassley, as you -- as you move forward now leading the Senate's effort on this, are you hearing from your colleagues in Congress and the U.S. House of Representatives who are standing for election next year with this host of problems that both you and Senator Baucus say loom larger, are you hearing from them this is going to be a real issue for us in the election next year?

GRASSLEY: Well, I think a practical matter is that all 535 members would just as soon never deal with Social Security, but we know that we need to deal with it. And we have this opportunity to deal with it. And so I'm taking the advantage of that opportunity. And as far as the House of Representatives is concerned, if we can't get something through the United States Senate, I wouldn't blame them for not taking it up, and I think in a sense, at least Republicans in the House of Representatives not walking a plank if they don't need to. So if we can't succeed in the Senate, I don't expect them to take it up in the House. I just don't expect them to.

BAUCUS: And I say it too, that Senator Grassley and I are good close personal friends. We agree on most everything. We're both pragmatic and practical. And this issue, I'm just trying to in a sort of congenial way convince my good friend Chuck Grassley that maybe we can just get private accounts away, not deal with that, but let's do stick with the long-term financial problems. And hey, we can go back to the good old days when he and I are working together to get something done.

DOBBS: Senator Grassley, Senator Baucus we thank you both for being here.

GRASSLEY: Thank you very much.

BAUCUS: Thank's, Lou. DOBBS: And still ahead, "Your Thoughts" on illegal immigration. And the results of our poll tonight on Social Security reform. A preview as well of what is ahead tomorrow. Stay with us.


DOBBS: And here is the way you voted in our poll tonight -- 80 percent of you say President Bush and Congress should just drop the issue of Social Security altogether, 20 percent say no, they shouldn't.

Taking a look now at some of "Your Thoughts" on the immigration crisis in this country.

Brendan O'Reilly, from East Patchogue, New York writes to say, "Lou, I've been wondering about something for a while, and I was hoping you could help me out. I believe that the federal government should be securing our borders. Now does that make me a Republican or a Democrat? I can't tell, because neither party is doing anything about it."

Bobbi in New Lennox, Illinois, "Anyone who wants to legalize illegal immigrants should go to Mexico with them. We are getting tired of paying for their medical care, lawyers, and jail time. Not be able to ask if they are legal is B.S. and it's time to stop pussyfooting around with the issue."

Eileen Dunn in Canton, Ohio, "The only thing more ludicrous than the corrupt Mexican government foisting its citizens on the United States is that the United lets them do it."

And Katherine in Oklahoma City, "Mexico does not need a plan to better the lives of its citizens. Mexico's plan is to send their citizens here to send the money back home. The U.S. taxpayer is Mexico's economic plan."

Sean Allen in Atlanta wrote in about our poll question last night in which we asked should the United States hold Mexico responsible for its citizens illegally crossing our border?

Sean said. "I voted no on last night's question. We should not be holding Mexico responsible for our border" patrol -- "border problems. We should be holding our senators and representatives responsible. All of us Americans should let our elected officials know they have very little time to not only address the problem, but fix it. Otherwise we will take back our country, not from illegal immigrants but from our ineffective legislators."

Al Nagengast from Payson, Alaska wrote to say, "Lou, illegal aliens are entitled to only one right: deportation!"

We thank you for sending in "Your Thoughts." Send us yours at Each of you whose e-mail is read on the broadcast receive as copy of my book "Exporting America." Sign up for our newsletter on our Web site at Thanks for being with us tonight. Please join us here tomorrow when I'll be talking with a national columnist who says it won't do any good to secure our borders as long as American employers continue to hire illegal aliens.

Also tomorrow, how improvements to technology are making it even easier to outsource one of our most prized creative industries.

And the fight for the filibusters: a leading Democratic senator who's fighting the Republican leadership over the president's judicial nominees.

All of that and a lot more tomorrow. Please join us. Thanks for being with us tonight. For all of us here. Good night from New York.

"ANDERSON COOPER 360" starts right now here on CNN -- Anderson.



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