Business Typhoon Dobbs Blows for Middle Class

When the Republican National Convention opens on Aug. 30, a red-state flotsam will descend on a code-orange New York and

When the Republican National Convention opens on Aug. 30, a red-state flotsam will descend on a code-orange New York and an anemic economy that stubbornly refuses to generate jobs. As the latest employment figures from the Labor Department reveal, the economy added just 32,000 jobs in July, more than 90 percent below what many experts predicted. Like the Iraqi insurgents taking pot shots at Marines in the Sunni triangle, the economic quagmire that the White House insists on labeling a recovery continues to dog George W. Bush on the eve of his re-election bid.

For the past year, Lou Dobbs, CNN’s venerated business anchor, has transformed his nightly 6 p.m. show into a firing squad aimed at corporations and the Bush administration, both of whom, in his view, have exacerbated the unemployment crisis as companies continue to outsource American jobs overseas. On the same day the Republican convention opens, Mr. Dobbs’ book, Exporting America: Why Corporate Greed Is Shipping American Jobs Overseas , will hit bookstores.

“My God, if you can’t be against outsourcing, what the hell can you be against?” Mr. Dobbs said on a recent afternoon in his office on the fifth floor of CNN’s cavernous new headquarters inside the crystalline Time Warner Center. The host of CNN’s flagship nightly business program, Lou Dobbs Tonight , eased back in one of those ergonomic Herman Miller chairs, taking in a sprawling view of midday traffic languidly circling Columbus Circle through the floor-to-ceiling window. He wore a pinstriped navy suit with a starched white shirt, and his flaxen hair was brushed to a fine sheen.

“The middle class is America,” he continued between bites of a B.L.T. ordered up by his assistant. He sipped on a Diet Snapple. “Too many of our elites, from business to academic or journalistic, are forgetting that essential truth.”

Mr. Dobbs makes a curious stand-in as a devout middle-class crusader, but in the past year he has woven a new story: that of a Harvard-educated business journalist turned fiery populist who has become a champion of the American worker. And people seem to be buying it: His ratings are up 19 percent in total viewership from last year. Earlier this spring, The Wall Street Journal ‘s Daniel Henninger wrote that Mr. Dobbs was running his show “as if he were doing talk radio at 2 a.m. in Youngstown.” An editorial in The Economist trilled that Mr. Dobbs greeted “every announcement of lost jobs as akin to a terrorist assault.” John Castellani, the president of the Business Roundtable, a C.E.O. lobbying group, dubbed Mr. Dobbs’ anti-outsourcing campaign “a jihad.”

“It’s impossible to overstate that I truly believe the symbolism in preserving the middle class of this country. If we can’t do that, I’m not sure what we can do,” said Mr. Dobbs, speaking about the hot-button political issue of corporate America shipping high-tech and white-collar jobs to low-wage countries such as India and China.

The outsourcing issue has gained a lot of traction in the run-up to November’s election. John Kerry has routinely lashed out against the “Benedict Arnold C.E.O.’s” who send American jobs abroad, and has proposed legislation to curtail the practice. President Bush and party officials have been nervously eyeing each successive wave of dour economic news that Mr. Dobbs has embraced as his cause célèbre . These days, they just hope he will quietly slink away.

“The White House is very annoyed with me, it’s fair to say. I’m very annoyed with them on this issue,” Mr. Dobbs said as he looked at a photo of himself with Vice President Dick Cheney on his bookshelf. “Various representatives of the administration have suggested to me that because I’m a lifelong Republican, I bear some responsibility to accept whatever approach is taken by the Republican administration, which to me is utter nonsense. I think they’re wrong. I think the Clinton administration was wrong. And, who knows, there may be a Kerry administration, and I may think it’s wrong. And when I do, I’ll express my view. My audience expects it, and I will .”

With the publication of his book, the great big sucking noise that Ross Perot so famously plugged in his 1992 anti-NAFTA campaign may be back. Except this time, it’s not Mexico we’re warned to be scared of, it’s the enterprising Indians and Chinese. So much for Thomas Friedman’s sunny portraits in his New York Times column of Indian workers watching Friends and shopping at Target. In Mr. Dobbs’ America, we are told to look out for No. 1.

Is the ideological transformation of this cable news icon-a staunch Republican who owns a sprawling horse farm in northwest New Jersey, enjoys scuba diving and famously rankled his superiors at CNN before abandoning the network in 1999 to helm the Web site a firebrand for the middle class for real? Mr. Dobbs’ critics wonder if he has truly reoriented his thinking or, with Exporting America , has simply morphed from a business journalist to an opinion jock engaged in the battle for ratings against Fox News.

Exporting America reads like a series of vociferous editorials, with facts and statistics spelling the demise of the American middle class thanks to corporate profits and Washington’s obsession with expanding global trade.

“The millions of unemployed workers in this country deserve better, and so do the millions of Americans whose jobs are threatened by mindless trade, labor and immigration policies,” he writes in an early chapter.

The book is an extension of Mr. Dobbs’ broadcast, where nearly every night at 6 p.m. for the past year, viewers have tuned in to see Mr. Dobbs fire broadsides at corporations, C.E.O.’s, politicians and consultants such as McKinsey and Co. and Accenture, who have been responsible for-in his view-sending American jobs to far-flung countries while corporate profits soar and executive compensation spirals to new heights.

The worsening economic picture has given Mr. Dobbs heavy artillery. On Aug. 6, the Labor Department reported that in July, the U.S economy added only 32,000 jobs when most analysts had forecast that employment growth would top 250,000. The Dow dropped to its lowest level in 2004; oil reached a record high of $44 a barrel; and, in June, consumer spending plummeted to its lowest level in three years. As John Kerry will be happy to tell you, President Bush is at risk of presiding over the first administration since Herbert Hoover to witness a net loss of jobs.

It is in this climate that Mr. Dobbs blames the unholy alliance of “big business and big government” for the devastation of white-collar jobs long thought to be immune from the employment exodus that ravaged the manufacturing sector in the 1970’s.

Not all economists back Mr. Dobbs’ apocalyptic “us-versus-them” view of outsourcing.

“Right now, I share the view we’re really taking a weak domestic job market and focusing attention on a side issue, which is outsourcing,” said Paul Krugman, the New York Times columnist and author of The Great Unraveling . “My story is that it’s 1992 all over again. We have a mainly domestic problem, and the foreign component is getting wide attention. Once there is a good economic recovery under way, this will seem a lot less important.”

“I think that offshore outsourcing is attractive to companies that want to streamline operations,” said Stephanie Moore, an analyst at Forrester Research. “You have to look at the process holistically: By outsourcing, companies can lower their costs and increase their wealth creation and actually add jobs.”

President Bush’s economic advisors echo this view. In February, N. Gregory Mankiw, the chairman of the White House Council of Economic Advisors, faced a barrage of attacks after he told reporters that “outsourcing is a growing phenomenon, but it’s something that we should realize is probably a plus for the economy in the long run.”

As for the claims that he’s just hunting for more viewers with his populist stance, Mr. Dobbs bristles.

“This is madness. This is not intelligence, this is not rational, and this is not American, ” he said. “The Wall Street Journal , in my opinion, is a wonderful organization, but on the editorial side they are ideologues, and that adherence to ideology has primacy over openness and dialogue. It’s not unexpected. But it’s a shame that important voices will not be open and analyze the reality.

“Look, I love international trade,” he continued. “I love India so much I’ve taken my family there on vacation. The fact is, does one transfer a job to a foreign country to provide services and products to the home market? The answer is no . This is the first time it’s ever been attempted, and it’s idiotic.

“Henry Ford understood that if you pay high wages, people can afford to buy the cars they’re making-and if they can’t, unpleasant things are going to occur. If we look at wages, they are basically stagnant in this country for 30 years while profits have soared, and there has been very little participation in this growth for the working men and women in this country.”

Mr. Dobbs joined CNN in 1980, back when a 24-hour cable news channel was Ted Turner’s brainchild. In 1995, he launched CNNfn and became president of the division. He hosted Moneyline, which garnered the highest ad rates and became the most profitable business program on the air. Twice during this rise, Mr. Dobbs had reportedly been passed over for the CNN presidency, and on numerous occasions he threatened to walk away. In 1999, the private battles went public: During a Moneyline broadcast, Mr. Dobbs voiced his objections to then-CNN president Rick Kaplan’s decision to cut to Littleton, Colo., where President Bill Clinton was speaking at a memorial for the Columbine High School massacre. Mr. Dobbs opposed the direction on the air, saying, “CNN president Rick Kaplan wants us to return to Littleton.”

Several weeks later, after tussling with senior management over the terms of his investment in a nascent Web site called, Mr. Dobbs quit CNN-and his $1 million salary-for an Internet start-up about rockets and asteroids.

“It was no longer fun for me to fight with management. When it was no longer fun, I decided to leave,” Mr. Dobbs said, looking up at a model of the space shuttle perched on his desk. “I’ve always believed if one has a disagreement with management, one has an obligation to come to terms with it or walk away from it. I chose to walk away.”

But Mr. Dobbs returned to CNN in 2001, and he hasn’t lost his taste for stirring up trouble. Following Sept. 11, he called the war on terrorism a war on radical Islamists. In 2002, during the Enron conflagration, he opposed the indictment of the accounting firm Arthur Andersen, even after it was revealed that Andersen was an auditor of his Internet company, Space Holdings Inc. And in his new book, when Mr. Dobbs lists the hundreds of companies that have sent American jobs to other countries, Time Warner, CNN’s parent company, is squarely on the list.

“Time Warner was one of the first we put on,” he said. “First the producers said, ‘Are you sure you want to do this?’ And I said, ‘Absolutely.’ Because AOL outsources jobs, call centers-that sort of thing.”

CNN executives remain outwardly supportive of Mr. Dobbs’ vocal opposition to outsourcing.

All this comes at a time of transition for the program. Last month, executive producer Bill Dorman left CNN to head Bloomberg’s Asia operations, and the network has yet to fill his position.

Still, no matter what his doubters say, Mr. Dobbs’ rapid political transformation might be a return to his roots, of sorts. He grew up in rural Texas and Idaho; his father worked as a propane distributor and his mother was a bookkeeper. Throughout his childhood, Mr. Dobbs worked on farms and ranches.

“I’ve never been able to rationalize a social structure that does not honor work in any form,” he said. “I was always told to honor hard work, no matter what. That’s a value structure that has dissipated, perhaps, over time. I’m not sure what we honor now as a society, other than C.E.O.’s and senior management who make extraordinary sums of money not necessarily related to performance.

“We are desperate in this country for a countervailing power to that of corporate America politically,” he said. “If you’re not willing to protect the American middle class in the values that make the American dream possible, you’re not going to get my vote. And I don’t care what your party says.” Business Typhoon Dobbs Blows for Middle Class