Dan Froomkin article from yesterday (see the comments !)

White House Fails Self-Examination

By Dan Froomkin

Special to washingtonpost.com

Tuesday, June 10, 2008; 1:14 PM

A glimpse of what "internal review" means to this White House supports the theory that top Bush aides have little interest in self-examination or public disclosure.

After a Sept. 2006 Congressional report based on records from convicted influence peddler Jack Abramoff's lobbying firm revealed 485 contacts between Abramoff and his associates and White House officials, then-press secretary Tony Snow promised White House lawyers would take a "good hard look" at the relationship with Abramoff. "We'll let you know what they found out," Snow said. "That's an important concern, and it's worth looking into."

Four days later, an assistant to political guru Karl Rove was jettisoned from the White House. Susan Ralston, who had worked for Abramoff before Rove, had accepted tickets to nine events from her old boss while providing him information and access.

And with that, White House spokeswoman Dana Perino announced: Our review of the House Government Reform Committee's report is complete. . . . We expect nothing more after our thorough review."

How thorough was that review? A new Abramoff report released by the House Oversight and Government Reform Committee yesterday -- this one based on documents and testimony from White House officials -- finds no evidence of any review at all.

"The Committee asked several former White House officials interviewed or deposed by the Committee whether the White House contacted them to inquire about their contacts with Mr. Abramoff. None of the White House officials who spoke with the Committee had any recollection of White House officials asking them about their contacts with Mr. Abramoff or his associates," the report states.

"[T]he White House never questioned five former White House officials who were key points of contact for the Abramoff team. For example, [Matt Schlapp, a former White House director of political affairs] who testified that Mr. Abramoff was a resource for him and was known and respected at the White House while he was serving there, did not recall any consultation from White House officials before they made public statements about Mr. Abramoff's minimal contacts with the White House." And so on.

"This evidence suggests that the White House failed to conduct even the most basic internal investigation of the White House relationship with Mr. Abramoff before making public statements characterizing the connection between Mr. Abramoff and the White House."

Pete Yost writes for the Associated Press: "In response, White House spokesman Tony Fratto noted the 'difficulty of conducting in-house investigations while there are other ongoing investigations outside the White House.' The Justice Department has been investigating the Abramoff scandal since 2004."

The Coverage

Marisa Taylor writes for McClatchy Newspapers: "Convicted superlobbyist Jack Abramoff influenced White House actions while his firm wooed administration officials over expensive meals and plied them with box tickets to sporting events, according to a House of Representatives committee report released Monday.

"The House Committee on Oversight and Government Reform said Monday that it had received new White House documents and testimony that confirmed 80 White House contacts with Abramoff and uncovered 70 others despite White House assertions that Abramoff had vastly overblown his administration connections. Abramoff, who's cooperating with federal prosecutors after pleading guilty in an expanding corruption investigation, previously reported that his former firm had more than 400 contacts with White House officials.

"The House report obtained photos of Abramoff meeting President Bush on six occasions, including political receptions. Bush has said he doesn't remember Abramoff, and the White House has refused to release the photos. The committee posted low-quality versions of them on its Web site Monday after receiving them from the White House."

James V. Grimaldi writes in The Washington Post: "Then-lobbyist Jack Abramoff influenced some White House decisions by lavishing exclusive sports tickets and meals on political staff members, but there is no evidence that President Bush was involved, a congressional panel said in a draft report yesterday. . . .

"Primary among successes by Abramoff's team, the report found, was persuading Bush officials to seek the removal of Alan Stayman from the State Department position overseeing the relationship with the Commonwealth of the Northern Mariana Islands, a major client of Abramoff and his firm, Greenberg Traurig. . . .

"In the Stayman matter, an e-mail exchange showed the potential sensitivity in the White House. Public affairs director Matt Schlapp wrote, 'how do we fix this?' Monica Kladakis, a personnel deputy, replied, 'I think we can do something about it, but . . . I don't want a firing scandal on our hands.'

"Among those getting tickets was senior adviser Karl Rove, who paid Abramoff $150 for three tickets to the NCAA basketball tournament on March 17, 2002. Rove also had use of the suite at Verizon Center to treat his class of College Republicans to a Washington Capitals hockey game on Nov. 9, 2002. . . .

"White House spokesman Tony Fratto said the report 'confirms what has become clear in all of this -- Abramoff was spectacularly unsuccessful in influencing administration policy.'"

The authors of the report note that their investigation was "hindered in several ways that limit the scope of the Committee's conclusions.

"First, six individuals, including three former White House officials, whom the Committee sought to depose or interview refused in whole or in part to answer the Committee's questions on Fifth Amendment grounds. Second, the Committee did not take the depositions of several relevant lobbyists identified in the 2006 Committee staff report, including Mr. Abramoff himself, because the Department of Justice expressed concern that congressional depositions could undermine ongoing investigations. Third, the Justice Department asked to withhold documents from the Committee out of a similar concern. Fourth, several of the individuals deposed or interviewed by the Committee asserted that they were unable to recall the specifics of some of the matters under investigation, which occurred four to seven years ago."

And then there's this: "It is possible the investigation was also made more difficult by the fact that some White House officials may have used e-mail accounts maintained by the Republican National Committee to discuss Abramoff matters among themselves. The RNC informed the Committee that it has retained few or no e-mails for these officials for the relevant time period."

Karl Rove Was Fired

Karl Rove's official explanation for why he decided to leave the White House last August was "I just think it's time."

But according to a new Rove biography by Paul Alexander, it wasn't a time of his choosing. In "Machiavelli's Shadow: The Rise and Fall of Karl Rove," Alexander writes that Rove was fired.

"On a Sunday in midsummer, George W. Bush accompanied Karl Rove to the Episcopalian Church Rove sometimes attended. Though he did not consider himself a believer, Rove still went to church on occasion, at least for appearance's sake. On the other hand, Bush enjoyed attending church and had since he had joined the Methodist Church years before at his wife's urging. So, on this Sunday, Rove thought he was doing what he often did: spending time with the man for whom he had worked, almost exclusively, for nearly a decade and a half. The two men entered the church along with their wives. They made their way to the front of the congregation. Then, during their time in the church, Bush gave Rove some stunning news.

"'Karl,' Bush said, 'there's too much heat on you. It's time for you to go.'"

In the calm solitude of the church, these were no doubt the last words Rove expected to hear. But Bush had said them. They were now a reality. As anyone who serves at the pleasure of the president knows, Rove had to do as he was told."

"'Yes, sir, Mr. President. I understand.'"

"He did, too. After that Sunday, what Rove had to do was in-vent a story he could tell the world-literally the world, since news of his departure from the White House would be splashed on the front pages of newspapers around the globe-that would claim he was leaving of his own accord when in fact he was not."

Alexander attributes that scene to "a source close to a key adviser to the president." He also quotes "one of Bush's counselors" in a conversation with "a political consultant" about Bush's rationale: "'There were four main reasons,' the counselor said. First, problems might still arise in Texas as a result of information Jack Abramoff may not have yet given regarding the DeLay investigation. Second, government documents had been altered by Rove's former assistant Susan Ralston when she had changed Rove's calendar, at his instruction, to cover up meetings he had had with Abramoff. Third, potential violations of the Hatch Act had occurred when Rove's PowerPoint presentation was used in lecturing government workers about how to help Republicans get elected. Fourth, the Senate Judiciary Committee had the e-mails that proved Rove was involved in the US attorney scandal. With all of this, Bush had no choice but to let Rove go."

Torture Watch

The American Civil Liberties Union is calling on Congress to focus on the National Security Council role in setting the nation's torture policies.

The ACLU explains: "The recent Justice Department Inspector General report on the FBI's role in interrogations helps substantiate that the NSC was the decision-maker on interrogations. The IG reports that there were 'regular (sometimes weekly)' meetings on detainee issues by the NSC Policy Coordinating Committee (that included top attorneys from the relevant agencies), and that unresolved issues were bumped up first to the NSC Deputies Committee (made up of the number two officials at departments such as Justice, Defense, State, and the CIA), and then to the NSC Principals Committee (chaired by Rice and including Cheney, the Attorney General, the director of the CIA, and secretaries of Defense and State). Although the IG's focus was on the FBI, he describes various efforts by Justice Department and FBI officials to raise concerns about the interrogations, and many of those expressions of concern went to NSC officials or to NSC committees."

The group's senior legislative counsel Christopher Anders said in statement: "The Inspector General's references to the National Security Council provide a small window into what has been a completely hidden and ignored piece of the torture puzzle -- but perhaps the most important piece of all. It is now the job of Congress to crack that window open more, and shed some light on what was going on in the basement of the White House. The central locus of decisions on torture may very well have been the National Security Council under Condoleezza Rice's leadership, but the NSC and Rice have made it through four years since Abu Ghraib with almost no oversight or attention. It is time for the NSC and Rice to be held accountable for any torture authorized under her watch."

NPR's Bob Garfield over the weekend asked former White House spokesman turned author Scott McClellan to account for his mouthing of torture talking points. Garfield played an example from June 2004, when McClellan has this to say about Bush: "He does not condone torture and he has never authorized the use of torture. The President has made that very clear in the past, and he continues to hold that view, because we are a nation of - certain laws and certain values, and torture is not consistent with our values and with our laws."

McClellan told Garfield: "On the waterboarding issue, I now look back on that, and I didn't know the specifics about that. I wasn't briefed into that from a classification standpoint. But I was told by others in the administration that it's not torture, and I did go out and defend that.

"And some actually in the administration view it that way. They view what they were telling me as the truth. I don't see how stepping back from it and knowing what we know now about that, that you can view it as anything but torture."

McClellan To Testify

Michael Abramowitz writes in The Washington Post: "Former White House press secretary Scott McClellan has agreed to testify next week before the House Judiciary Committee about his assertions that top Bush administration officials misled him about their role in the leak of the identity of CIA operative Valerie Plame Wilson.

"In his new book, 'What Happened,' McClellan writes that then-White House political adviser Karl Rove and then-vice presidential chief of staff I. Lewis 'Scooter' Libby deceived him about their involvement in the leak -- prompting him to pass on inaccurate information to reporters.

"The disclosure drew the attention of Judiciary Committee Chairman John Conyers Jr. (D-Mich.). He has expressed particular interest in McClellan's assertion that he had been directed by then-White House Chief of Staff Andrew H. Card Jr. to vouch for Libby's lack of involvement, as he had for Rove."

McClellan was on MSNBC's Countdown last night, where he told Keith Olbermann: "I'll tell them what I know. I am not going to get into things that I don't know about."

Senate Intel Report Watch

Olbermann also asked McClellan for his reaction to the Senate Intelligence Committee report released last week. As I wrote in Friday's column, the long-awaited report found that the administration's most compelling charges in the run-up to war -- for instance, that Saddam Hussein was about to supply al-Qaeda with nuclear weapons -- were simply made up.

McClellan: "What I do know is that the White House never wanted to have the way the case was made, the way the intelligence was used to sell the war to the American people looked into or investigated by Congress. This was delayed for quite some time. And finally Chairman Rockefeller, Senator Rockefeller, pushed this forward to get to the truth. And the White House can continue to bury their heads in the sand, but the reality is still the same. I think the American people see it for exactly what it is."

The Philadelphia Inquirer editorial board writes: "President Bush awarded the Medal of Honor last week to Army Pfc. Ross McGinnis, a Pennsylvania native who died in Iraq after throwing himself on a grenade, saving the lives of four other soldiers.

"Three days later, the Senate released a report that concluded that Bush and his aides repeatedly overstated the threat posed by Iraq in the run-up to the war.

"McGinnis' valor is without question. The 19-year-old from Knox, Pa., gave his life not only to his country but especially to the fellow soldiers he saved in Baghdad in December 2006. Presenting the Medal of Honor to McGinnis' parents was 'a high privilege,' said Bush. His sentiments are echoed by many Americans.

"But the timing of the award and the Senate intelligence committee report serves as a stark reminder that the deaths of McGinnis and more than 4,000 U.S. casualties might have been avoided were it not for Bush & Co.'s rush to war."

Deal or No Deal?

Lolita C. Baldor reports from Washington for the Associated Press: "The Bush administration is conceding for the first time that the United States may not finish a complex security agreement with Iraq before President Bush leaves office.

"Faced with stiff Iraqi opposition, it is 'very possible' the U.S. may have to extend an existing U.N. mandate, said a senior administration official close to the talks. That would mean major decisions about how U.S. forces operate in Iraq could be left to the next president, including how much authority the U.S. must give Iraqis over military operations and how quickly the handover takes place. . . .

"The Bush administration is seeking an agreement with Baghdad that would provide for a normal, permanent U.S. military and diplomatic presence in Iraq. The word 'permanent' has been a flashpoint for many who oppose the war, both in the U.S. and Iraq."

And here's an administration attempt at giving the word "permanent" a whole new non-meaning.

Baldor's official repeated the administration position "that the agreement will not call for permanent U.S. bases on Iraqi soil.

"Instead, the proposed agreement would allow U.S. troops or personnel to operate out of U.S., Iraqi or joint facilities through either short or long-term contracts, said the official, who spoke on condition of anonymity because the negotiations are not public.

"'The idea that the U.S. will have a normal, diplomatic and military presence, and need access to facilities -- not necessarily our facilities, but need facilities -- is permanent,' said the official, who is close to the ongoing talks.

"Those facilities, the official said, could belong to the Iraqis, and the U.S. would simply be using them on a renewable basis. Or they could be existing U.S. facilities that over time would be taken over by the Iraqis."

Meanwhile, however, Baldor's Associated Press colleague Bushra Juhi reports from Baghdad: "The U.S. State Department's top Iraq adviser said Tuesday he believes an agreement to establish a long-term security relationship between Iraq and the United States will be completed by the end of July.

"'We're confident it can be achieved, and by the end of July deadline,' David Satterfield told reporters in Baghdad's U.S.-guarded Green Zone."

Leila Fadel writes for McClatchy Newspapers: "Iraqi lawmakers say the United States is demanding 58 bases as part of a proposed 'status of forces' agreement that will allow U.S. troops to remain in the country indefinitely.

"Leading members of the two ruling Shiite parties said in a series of interviews the Iraqi government rejected this proposal along with another U.S. demand that would have effectively handed over to the United States the power to determine if a hostile act from another country is aggression against Iraq. Lawmakers said they fear this power would drag Iraq into a war between the United States and Iran.

"'The points that were put forth by the Americans were more abominable than the occupation,' said Jalal al Din al Saghir, a leading lawmaker from the Islamic Supreme Council of Iraq. 'We were occupied by order of the Security Council,' he said, referring to the 2004 Resolution mandating a U.S. military occupation in Iraq at the head of an international coalition. 'But now we are being asked to sign for our own occupation. That is why we have absolutely refused all that we have seen so far.'

"Other conditions sought by the United States include control over Iraqi air space up to 30,000 feet and immunity from prosecution for U.S. troops and private military contractors. The agreement would run indefinitely but be subject to cancellation with two years notice from either side, lawmakers said."

And Ashraf Khalil writes for the Los Angeles Times: "Iraqi Prime Minister Nouri Maliki concluded a three-day visit to Iran after meeting Monday with Ayatollah Ali Khamenei, who warned that the continued presence of U.S. troops was 'the main obstacle on the way to progress and prosperity in Iraq.'"

Bush in Europe

Dan Eggen writes for The Washington Post: "President Bush and European Union leaders threatened Iran on Tuesday with new financial sanctions unless the country curbs its nuclear ambitions and opens facilities to international inspection.

"Following a two-hour meeting that touched on Iran and a host of issues including climate change and trade, Bush and his European counterparts indicated they were prepared to go beyond current United Nations sanctions to try to ensure Iran does not develop a nuclear weapon. . . .

"'Now is the time for there to be strong diplomacy,' Bush said after the meeting, appearing with Slovenian Prime Minister Janez Jansa and European Commission President José Manuel Barroso.

"'They can either face isolation, or they can have better relations with all of us,' Bush said. 'We'll find new sanctions if need be.'"

In this morning's Post, Eggen wrote from Slovenia about how "Bush opened a farewell tour of Europe on Monday night in this tiny, picturesque nation, which is basking in its status as the current head of the European Union and the most successful state to emerge from the violent breakup of Yugoslavia in the 1990s."

A Strong Dollar?

Gerard Baker and Tom Baldwin writes in the Times of London: "President Bush issued a call for a rise in the value of the US dollar on currency markets yesterday in a signal of mounting official alarm in Washington about the effect of the slumping greenback on the world's largest economy.

"In an exclusive interview with The Times on the eve of the United States-European Union summit in Slovenia, Mr Bush expressed concern about the dollar's continuing weakness and said that he favoured an appreciation in the US exchange rate.

"'We want the dollar to strengthen,' he said on Air Force One as it crossed the Atlantic bound for the summit."

But Deb Riechmann writes for the Associated Press that in his press availability today, Bush "essentially rejected the idea of possible government intervention to prop up the value of the U.S. dollar. He said he believed in a strong-dollar policy, but that world economies will end up setting the value of the dollar."

Sheryl Gay Stolberg and Steven R. Weisman write in the New York Times that in commenting on the dollar, "Mr. Bush may have had political considerations in mind, both domestic and foreign.

"The last time Mr. Bush went to Europe, in April, some Republicans faulted him for looking out of touch on the economy. This week's trip, with glamorous cities like Berlin, Rome, London and Paris on the itinerary, is already being characterized by his critics as a summer vacation while gasoline rises above $4 a gallon and Americans feel the pinch at grocery stores."

Housing Watch

Bush has often cited rising minority home ownership as a milestone achievement under his "ownership society" programs.

Carol D. Leonnig writes in The Washington Post: "In 2004, as regulators warned that subprime lenders were saddling borrowers with mortgages they could not afford, the U.S. Department of Housing and Urban Development helped fuel more of that risky lending.

"Eager to put more low-income and minority families into their own homes, the agency required that two government-chartered mortgage finance firms purchase far more 'affordable' loans made to these borrowers. HUD stuck with an outdated policy that allowed Freddie Mac and Fannie Mae to count billions of dollars they invested in subprime loans as a public good that would foster affordable housing.

"Housing experts and some congressional leaders now view those decisions as mistakes that contributed to an escalation of subprime lending that is roiling the U.S. economy.

"The agency neglected to examine whether borrowers could make the payments on the loans that Freddie and Fannie classified as affordable. . . .

"'For HUD to be indifferent as to whether these loans were hurting people or helping them is really an abject failure to regulate,' said Michael Barr, a University of Michigan law professor who is advising Congress. 'It was just irresponsible.'"

Immigration Watch

Nicole Gaouette writes in the Los Angeles Times: "The Bush administration, in an aggressive new effort to keep illegal immigrants out of the workforce, on Monday ordered all companies doing business with the federal government to begin ensuring their employees can legally work in the U.S."

Julia Preston writes in the New York Times: "An executive order, signed by the president on Friday and announced on Monday. . . . expands the E-Verify program, which has been the target of criticism and lawsuits by employers' groups and advocates for immigrants who say the Social Security database it draws upon to check workers' status is riddled with errors that could lead to legal workers' being fired or rejected for employment."

Justice Watch

Brian Ross, Anna Schecter and Murray Waas report for ABC News that current and former employees of the Justice Department's Office of Juvenile Justice and Delinquency Prevention allege that political appointees who issued grants "ignored the staff rankings in favor of programs that had political, social or religious connections to the Bush White House."

Impeachment (Non) Watch

The Associated Press reports: "Rep. Dennis Kucinich, a former Democratic presidential contender, said Monday he wants the House to consider a resolution to impeach President Bush.

"Speaker Nancy Pelosi consistently has said impeachment was 'off the table.'

"Kucinich, D-Ohio, read his proposed impeachment language in a floor speech. He contended Bush deceived the nation and violated his oath of office in leading the country into the Iraq war.

"Kucinich introduced a resolution last year to impeach Vice President Dick Cheney."

Thinkprogress.org has the video.

Twilight Watch

Over at NiemanWatchdog.org, where I am deputy editor, we're out with part two of my series on what top administration officials might be doing to make it difficult for their successors to roll back their policies. Today's focus is on the ways a president can entrench people and policies within the executive branch bureaucracy.

History Watch

The Associated Press reports: "First lady Laura Bush acknowledged President Bush's unpopularity, but said Monday that history will vindicate her husband's two-term presidency.

"In an interview on ABC's 'Good Morning America,' Mrs. Bush noted the ousting of the Taliban in Afghanistan and Saddam Hussein in Iraq.

"'I know he may not be that popular right now, but we've liberated two countries -- 50 million people have been liberated from very brutal regimes -- and I think that's really important,' she said.

"She said the president has stood on the side of emerging democracies in central Europe.

"'He's going to have a really unbelievably great legacy, with the advantage of hindsight,' she said."

Late Night Humor

Jon Stewart marvels at how little coverage the Senate Intelligence Committee report got last week.

Cartoon Watch

John Cole and David Horsey on the verdict of history; Rex Babin on mission accomplished; RJ Matson on the Senate Intelligence report.

HISTORIC: WaPo Article on the Kucinich Impeachment effort

Kucinich Forces Vote On Bush's Impeachment

By Ben Pershing

washingtonpost.com Staff Writer
Wednesday, June 11, 2008; Page A02

Having failed in efforts to impeach Vice President Cheney, Rep. Dennis J. Kucinich (D-Ohio) escalated his battle against the administration this week by introducing 35 articles of impeachment against President Bush, using a parliamentary maneuver that will probably force a vote today.

Kucinich's impeachment measure accuses Bush of taking the country to war in Iraq under false pretenses; he introduced it as a "privileged resolution," which requires the House to take it up within two legislative days. Any lawmaker may offer a privileged resolution, but it is usually done only by party leaders.

Kucinich, upon introducing his articles of impeachment Monday evening, insisted on reading the resolution into the Congressional Record, a process that took nearly five hours. He finished reading it late yesterday after the close of legislative business.

As they have previously, Democratic leaders staunchly oppose Kucinich's impeachment effort. They expect to table the resolution by referring it to the Judiciary Committee, where they expect it to die.

House Majority Leader Steny H. Hoyer (D-Md.) suggested yesterday that engaging in a lengthy debate over impeaching Bush in the waning days of his administration is not a productive use of the House's time.

Kucinich tried a similar maneuver last November, bringing an impeachment measure against Cheney to the floor as a privileged resolution. It was referred to the Judiciary Committee.

Dan Froomkin on WH Contempt/US Congress

Dan Froomkin: Hi everyone and welcome! I know there's a presidential campaign going on, but pay attention. There's still a lot of important stuff going on in this White House.

Today's column (hopefully coming very soon) starts off with my thoughts about yesterday's congressional hearing into the missing White House e-mails. My conclusion: The Bush White House has made a mockery of the Presidential Records Act. I've also recently written about FISA, Bush the Space Cowboy, the Secret Rove and -- for those of you who just can't get enough campaign news -- about Bush's apparently cluelessness about what a drag he'll be on the Republican ticket.

*snip*

Berkeley, Calif.: What is the attorney general's justification for keeping secret any opinion written by the office of legal counsel? Do any credible legal scholars agree with him? The concept of a secret law seems very un-American to me.

Dan Froomkin: Bingo. Who really can defend secret law -- other than a few addled Cheneyites? It's just not American.

The House Strikes Back

Contempt

Paul Kane writes in The Washington Post: "The House yesterday escalated a constitutional showdown with President Bush, approving the first-ever contempt of Congress citations against West Wing aides and reigniting last year's battle over the scope of executive privilege.

"On a 223 to 32 vote, the House approved contempt citations against White House Chief of Staff Joshua B. Bolten and former White House counsel Harriet E. Miers over their refusal to cooperate with an investigation into the mass firings of U.S. attorneys and allegations that administration officials sought to politicize the Justice Department.

"The vote came after a morning of tense partisan bickering over parliamentary rules, including a GOP call for a vote on a motion to close the chamber that briefly forced lawmakers to leave a memorial service for Rep. Tom Lantos (D-Calif.), who died this week. The conflict was capped later in the day when most House Republicans walked off the floor and refused to cast a final vote. They accused Democrats of forcing a partisan vote on the contempt citations instead of approving a surveillance bill supported by Bush.

"Democrats said they were left with no choice but to engage in a legal showdown with Bush because he has refused for nearly a year to allow any current or former West Wing staff member to testify in the inquiry. Citing executive privilege, the president has offered their testimony on the condition that it is taken without transcripts and not under oath."

Richard B. Schmitt writes in the Los Angeles Times: "Democrats accused Republicans of pulling a political stunt. They said the contempt question was hardly a partisan issue because it concerned the system of checks and balances under the Constitution. Choosing not to enforce the subpoenas would be giving 'tacit consent to the dangerous idea of an imperial presidency, above the law,' said House Majority Leader Steny H. Hoyer (D-Md.) . . .

"Under the law, contempt of Congress charges are investigated by the U.S. attorney for the District of Columbia. But the Justice Department has taken the position in previous cases that it will not allow a U.S. attorney to conduct such an investigation if the department has determined that executive privilege was well-founded."

But: "

Under the resolution, even if the Justice Department declines to investigate, the House can file its own civil lawsuit against Miers and Bolten. Such a suit would be filed in federal court in Washington by the general counsel of the House. It could come at any time and would not depend on the approval of the Justice Department."

Here's the angry response from Perino:

"Today, the United States House of Representatives did something that had never been done in the entire 150-year history of the contempt of Congress statute: it voted to hold in contempt two top White House officials who had been directed by the President not to comply with House Judiciary Committee subpoenas on the basis of the President's assertion of Executive Privilege. The officials in question are the Chief of Staff to the President and the former Counsel to the President, two of the very closest advisers upon whom a President must rely. This action is unprecedented, and it is outrageous. It is also an incredible waste of time -- time the House should spend doing the American people's legislative business. . . .

"This is as a blatant sop to the far left and shameful behavior by House Democrats."

See also:
#1 Mukasey Refuses Probe of Bush Aides: http://ap.google.com/article/ALeqM5hq-4ZBiiUcq8IsbGQ0SHW04WS4kgD8V49BB03

Rice's Management at Issue

Is Condi being set up for a FALL? Why else would THIS article appear in the Washington Post? Are things at the top getting right wicked ...? I wish they would nail her on her WAR CRIMES, not her "management problems" ..

Critics Cite Blackwater, Baghdad Embassy and Passports

Many in the State Department's rank and file
see Secretary Condoleezza Rice as aloof,
reliant on her closest aides and
out of touch with the other employees.
(By Wathiq Khuzaie -- Getty Images)

By Glenn Kessler

Washington Post Staff Writer
Saturday, November 10, 2007; Page A01

Shortly after Condoleezza Rice took charge of the 57,000-person State Department in 2005, she said she relished the challenge of "line responsibility" in leading a large organization. "I really enjoy that," she said in an interview. "Some of my favorite times here have been my budget and high-level management reviews."

Nearly three years later, Rice is under fire from inside and outside the State Department for a range of crises that are largely managerial in nature -- the failure to monitor private security guards in Iraq, the delays in opening the huge U.S. Embassy under construction in Baghdad and the resistance of some Foreign Service officers to being forced to serve there. Over the summer, the department also fell woefully short in processing passport applications, resulting in ruined vacation plans for many Americans.

Within the department, Rice is viewed by many rank-and-file employees as an aloof manager who relies on a tight circle of aides, leaving her out of touch with the rest of the staff, in contrast to her predecessor, Colin L. Powell, a retired Army general who won praise from workers for treating them as though they were his "troops." At her last town hall meeting with employees 2 1/2 years ago, Rice told staffers: "I consider myself the chief management officer of this department." But a poll by the American Foreign Service Association indicated that an overwhelming majority did not feel that Rice was their advocate.

The latest controversy about forced assignments to Iraq has only heightened internal resentment of Rice's management style. "I personally do not like the ultimatum-giving," said one Foreign Service officer. "It is not what State is about."

Senior State Department officials dispute such charges, contending that Rice has moved quickly to deal with emerging problems at State despite her hectic overseas schedule. "Given what is on the secretary's plate, the myriad issues, the travel, the contact with foreign leaders and meetings at the White House, I never cease to be amazed at how up to speed she is on key management issues," said Deputy Secretary John D. Negroponte, who noted that he is the department's chief operating officer.

At a contentious hearing before the House Oversight and Government Affairs Committee last month, Democrats aggressively questioned Rice over what one lawmaker labeled "seriously deficient" management. Asked to explain her oversight of State's private security contractors, Rice offered an answer that, to some lawmakers, seemed to deflect responsibility: "I certainly regret that we did not have the kind of oversight that I would have insisted upon."

Committee Chairman Henry A. Waxman (D-Calif.) said he was taken aback by Rice's responses. "She acted as if she had nothing to do with it," he said. "There are too many issues we know about, in which people were not given the oversight they needed, in what seems to be a pattern of indifference to management."

Rice's management has come under fire before. As national security adviser during President Bush's first term, she was criticized by many insiders for permitting a dysfunctional policymaking process while fierce battles raged among top Cabinet members.

At State, Rice has pushed ambitious efforts to reshape how foreign aid is distributed and to shift key diplomatic jobs from Europe to emerging powers such as China and India. The foreign-assistance overhaul, in which Rice personally approved country-by-country budget numbers, was criticized by lawmakers and some within the department because it appeared to minimize the advice of specialists in the field. The job shifts were put in place so quickly that a number of Foreign Service officers who had been promised plum posts in Paris and elsewhere had to be told that those positions no longer existed. Henrietta H. Fore, undersecretary of state for management, said 285 overseas jobs have been shifted so far, with another 85 slated for movement.

Rice's defenders said she has taken on hard issues that previous secretaries ducked because they wanted to avoid dissent. They said she has been hampered by the fact that a key management job -- deputy secretary of state -- was vacant for eight months, after Robert B. Zoellick left in July 2006. Rice struggled for months to fill the post, which was unoccupied for the longest period in State Department history, until Negroponte came on board early this year.

Early on, Rice set up a seventh-floor office at State headquarters that in many ways echoed the style of one of the most successful secretaries of state, James A. Baker III, who served under President George H.W. Bush. Baker relied on a small group of senior officials to set policy. But aides also said Rice fancies herself as more like another predecessor, George P. Shultz, who was revered for listening to the bureaucracy's concerns.

When Rice is not traveling, she meets at 8 a.m. weekdays with a few top aides for half an hour to map out her day, before meeting with other top department officials. In the evenings, she holds a wrap-up meeting with close aides to review and plan ahead. Spokesman Tom Casey said Rice has visited the offices of about two dozen bureaus of the State Department and, since March, has met with a dozen desk officers to get their views.

Some State veterans compare Rice's management unfavorably with that of Powell, who was secretary during Bush's first term. Powell held large staff meetings daily; Rice cut those to three per week. And twice a week, she holds smaller meetings with undersecretaries and key regional assistant secretaries. Unlike Powell, who was an avid e-mailer, Rice does not use e-mail.

Powell worked closely with his deputy, Richard L. Armitage, who by all accounts carried the bulk of the management load. Armitage tried to make sure decision memos were acted on within 24 hours, whereas under Rice such memos may languish for days, a former official said.

"Powell did spend time on management issues," said John R.Bolton, former ambassador to the United Nations, who served under Powell and Rice and whose new book, "Surrender Is Not an Option," is critical of how Rice has directed foreign policy. "Rice is typical of secretaries of state in that they generally don't pay attention to management issues," Bolton said.

For any manager of a large organization, making sure problems come to the attention of top officials is critical. When Powell became chairman of the Joint Chiefs of Staff, he handed out rules to his staff, including "Bad news doesn't get any better with time" and "If there is a problem brewing, I want to know of it early." Some officials think that problems at State have trouble coming to Rice's attention early enough.

Another official who served under both secretaries said Powell asked more detailed questions when facing bad news. "You could not have a greater contrast between two people," he said, speaking on the condition of anonymity because he still deals with the government. "He had a style in which people were encouraged to talk about their problems."

A third official who served under both secretaries recalled how, after an assistant secretary of state made a mistake resulting in several days of negative news coverage, Powell treated that person with civility. By contrast, the official said, Rice becomes angry over even minor news accounts, turning furiously to the relevant assistant secretary for an explanation. "Dressing someone down like that is not great for morale and does not encourage people to bring up bad news," he said.

In a change that may have limited Rice's exposure to the rest of the building, Rice moved news conferences to the fancier higher floors of State's headquarters. While Powell held news media sessions outside -- after escorting out foreign officials -- Rice wanted a more dignified venue. Powell, after meeting with the media, chatted with workers in the lobby, reaching out to lower-level staff.

Senior officials disagree that Rice is isolated. "As secretary, you get information because you ask questions and you don't lock the door," said Pat Kennedy, director of State's office of management policy and a nominee for undersecretary for management. "She is open to discussion, and in the meetings she asks pointed questions."

Lawmakers have questioned why Rice has not anticipated potential problems. On the passport issue, for example, the State Department had estimated that passport applications would increase 33 percent because of new travel rules, but they jumped 51 percent instead, leaving State unable to handle the load. Rice forced 300 junior diplomats to give up their summer jobs to process passport applications and ordered that systems be streamlined to prepare for future surges.

Though there had been a number of deadly incidents involving contract security guards over the years, Rice did not order an investigation until after a Sept. 16 shootout in Baghdad involving guards from the private security contractor Blackwater left 17 Iraqi civilians dead.

And recognition of staffing issues and problems with the construction of the U.S. Embassy in Baghdad did not emerge until after Rice installed a new ambassador there this year. The embassy was short-staffed, and construction problems have delayed the opening of the $592 million complex.

Ryan C. Crocker, the U.S. ambassador in Iraq, said it is the "responsibility of the ambassador" to notify the secretary of state of problems -- and not the secretary's job to dig deeper if the news appears good.

Kennedy credits Rice with pushing for action after the Blackwater shootings. Before he departed for Baghdad on his first trip to review the incident, 12 days after the shootings, Rice told him she wanted an initial report "done fully but fast" -- in 96 hours, Kennedy said.

"Some might argue that such a review should have been taken earlier," Negroponte said. "But she moved very rapidly to deal with the situation. A test of a manager is that if problems come up, you are able to deal with them effectively."

Let's try this one more time: There isn't going to be any oversight in any type of market "trading" any time soon. The US Treasury Secretary will see to THAT. He's plenty of time to do something about it but doesn't. The US Treasury is at BEST a racket designed to keep money in the pockets of only those in the highest income brackets and at worst, playing the market to its own advantage.

The market on all levels is kaput; it's dominated by LARGE players; huge-profit billionaires and big time institutional investors including government agencies from the US and around the world. Many of these (take the Quebec Teacher's Pension Fund) are now bankrupt do to "bad paper" that were backed by liar loan mortgages - paper that could not be rated. Sure there are some Joe Potatoes investors shorting and the like (although that time has pretty much passed unless you can really justify the broker's fee to pay for your trades - or have a broker's license), but in the main the money which is NOT smart has gone into futures and commodity trading that THINKS the problem is oil and therefore wants to bet on commodities' prices going up due to the "inflation" of goods prices.

But the smart money has moved on, guys - the WaPo is misleading you (I sing with a caustic tone) ...

the truth is the MONEY is in copper as it leads to URANIUM. Super profits to be had! And no one, I assure you is going to regulate that money invested. In fact, the big funds are trading off shore, far away from REGULATION!!

The "energy" trading game is really being done in negotiating behind the scenes as to who is going to benefit from so-called carbon credits AND who can get the foot up on building new nuclear reactors. That's the REAL energy trading -- and that is only subliminally referred to in this article. Biodiesel fuels may LOOK like the future but they are NOT, people will notice that no solar, wind, water, air energy is being created. They will eventually notice that the earth cannot support dirty energy mining either. But meanwhile manipulation of the energy trading market will continue UNABATED - it's the red herring in the whole pile of utter .. um .. crap.

Everybody's been HAD; this article is an example of the "too little, too late" school of charm. Would that they had noticed all this during the post 9/11 market meltdown and profit taking in 2001, eh? What happened then boyz at the WaPo? How come nothing was said about regulation and oversight THEN?

You know a useful article might be one about sticking noses into the new NASDAQ trading .. and coming to grips with gambling addiction!! But I guess we'll just sit it out on the sidelines waiting for the "1929" type suicides to occur which have been remarkably slow to start .. YET.

Energy Traders Avoid Scrutiny

As Commodities Market Grows, Oversight Is Slight

By David Cho

Washington Post Staff Writer
Sunday, October 21, 2007; Page A01

One year ago, a 32-year-old trader at a giant hedge fund named Amaranth held huge sway over the price the country paid for natural gas. Trading on unregulated commodity exchanges, he made risky bets that led to the fund's collapse -- and, according to a congressional investigation, higher gas bills for homeowners.

But as another winter approaches, lawmakers and federal regulators have yet to set up a system to prevent another big fund from cornering a vital commodity market. Called by some insiders the Wild West of Wall Street, commodity trading is a world where many goods that are key to national security or public consumption, such as oil, pork bellies or uranium, are traded with almost no oversight.

Part of the problem is that the regulator, the federal Commodity Futures Trading Commission, has had a hard time keeping up with the sector it oversees. Commodity trading has exploded in complexity and popularity, growing six-fold in trading volume since 2000 -- the year that a handful of giant energy companies, including Enron, successfully lobbied to get Congress to exempt energy markets from government regulation.

Meanwhile CFTC's staffing has dropped to its lowest level in the agency's 33-year history. Its computer systems that monitor trades are outdated. Its leadership has seen frequent turnover.

"We are facing flat budgets and exponential growth in the industry," said CFTC Acting Chairman Walter Lukken. "Over the long term this type of budgetary situation is not sustainable."

The House Agriculture Committee is holding a hearing Wednesday on whether to expand the CFTC's authority and budget. In the Senate, Carl M. Levin (D-Mich.) has proposed a bill that would require all energy commodity exchanges to register with the agency and establish trading limits on investors. But similar efforts over the last few years have failed to make it out of committee. And this year, getting the House and Senate to vote on the matter may not be easy, given their busy agendas.

Some who work in the commodities markets question whether the CFTC, even if it got more money, would be an effective monitor because much of the trading occurs in private and is untraceable. Others criticized Levin's bill as overly broad, saying it could stifle markets that, Amaranth notwithstanding, have been working well.

Lawmakers acknowledged there are issues that have to be ironed out. But they are also concerned about time running out this year.

"We need to put a cop back on the beat in U.S. energy markets to stop excessive speculation and trading abuses," Levin said. "We have all seen what can happen if we don't act."

He was talking about Amaranth and its former star trader, Brian Hunter.

Hunter started trading energy commodities at age 24. After a tumultuous stint at Deutsche Bank, he was hired in 2004 by Amaranth Advisors, a hedge fund in Greenwich, Conn.

After making the fund $100 million in profits in natural gas in 2005, Hunter was promoted to head of energy trading. He began to take gigantic positions in natural gas on a regulated exchange called the New York Mercantile Exchange, or Nymex. Hunter largely traded highly volatile futures contracts, which allow investors to make complex bets on what price a commodity will fetch at various points in the future.

At one point in the summer of 2006, Hunter controlled up to 70 percent of natural gas commodities on Nymex that were scheduled to supply companies and homes in November of last year and more than 40 percent of contracts for the entire winter season, according to a report into Amaranth's activities by the Senate permanent subcommittee on investigations.

His positions were so big he could cause the price to move in the way he wanted by buying or selling massive amounts of his holdings in the last 30 minutes of trading on Nymex, a move known as "smashing the close," federal regulators say Nymex expressed concern over Hunter's activities and sent several warnings. Finally, in August 2006, Nymex ordered him to reduce his holdings. Hunter obeyed, but then simply replicated his positions on an unregulated commodity exchange run by Intercontinental Exchange (ICE), one of dozens in the industry, the congressional report said. And Hunter kept making trades.

Because ICE was not subject to any oversight, neither Nymex nor federal regulators could see what he was doing. Nevertheless, the volatility in gas prices that summer became so severe that even Hunter predicted it might draw official attention.

"Boy I bet you see some CFTC inquiries," Hunter wrote in an e-mail to another trader, according to the congressional report.

"Until they monitor [unregulated exchanges] no big deal," came the response.

In August, natural gas prices remained unusually high due to Amaranth's activity, according to the Senate investigation, even though adequate supplies combined with unusually warm forecasts made it apparent there would be plenty for the winter.

At the same time, many utilities across the country were locking in prices they would pay for the natural gas they would receive in the winter. They had no way of knowing what Amaranth was doing, said David Schryver, executive vice president of the American Public Gas Association.

But a few hedge funds became suspicious.

One of those, Centaurus, appeared to figure out the pattern behind Amaranth's investment strategy and positioned itself to make a profit at Amaranth's expense. On the last day of trading in August, Amaranth started selling off its gas contracts for September, but Centaurus countered by buying up Amaranth's positions. The two funds battled frantically over gas prices until the closing bell. Prices moved in the way that Centaurus had bet on.

Eventually Amaranth's losses totaled $6 billion. It lost the ability to pay back its debtors and closed its doors.

But homeowners lost out, too, because many utilities locked in prices for natural gas at just the wrong moment when gas prices were high. The ultimate cost nationwide has not been tallied, but one utility, the Municipal Gas Authority of Georgia, calculated that its 243,000 customers paid an extra $18 million in the 2006-07 winter season because of Amaranth. More than half of American homes are heated by natural gas. (and also half of those have no insulation, I'll betcha!!)

The CFTC filed a civil suit this summer accusing Hunter, who is still trading natural gas, of attempting to manipulate natural gas prices in 2006. Hunter, through his spokesman, denied the charge and said he would prove his innocence in court.

"It is worth asking whether the CFTC's sudden decision to file a headline-grabbing action against Brian Hunter was politically-motivated," Brian Maddox, Hunter's spokesman, wrote in an e-mail. "The CFTC's action came after several days of hearings conducted by the [Senate] criticizing the CFTC for ineffective regulation of natural gas."

Lawmakers and even some in the industry say more oversight of commodities is needed. ICE, the unregulated exchange that hosted the debacle, has begun to share some trading information with the CFTC. But there is little agreement on how far a new law should go, or whether commodity trading can be effectively monitored.

That's in part because a significant percentage of commodity trading doesn't happen on any organized exchanges, regulated or not. They take place in private, as over-the-counter trades. It is difficult to know how many of these are occurring.

Commodities markets also have become complex with many trading futures contracts as well as financial tools called derivatives and swaps, whose value is based on the risk of futures contracts. Gathering data on these products has been a challenge for the CFTC.

The evolution of the markets has led to some tension between the CFTC and the Federal Energy Regulatory Commission, the agency that oversees the commercial use of energy resources, which is directly impacted by commodity trading. The two agencies have both gone after unscrupulous traders.

For now lawmakers are focusing on increasing the authority of the CFTC, which has a stronger relationship with the commodity exchanges.

Levin's bill would require unregulated exchanges to comply with some of the same standards that the CFTC requires of a regulated body such as Nymex. For instance, unregulated markets would have to set limits on trader positions and share trading information with the CFTC. Levin's proposal would not seek to regulate trades that occur in private. Levin hopes to attach the measure to a farm bill currently moving through the Senate.

Exchanges are wary of these moves, warning of unintended consequences. Jeff Sprecher, the chairman and chief executive of ICE, said active unregulated exchanges serve an important function in helping determine the price of a commodity. Over-regulating them could squash that activity and encourage traders to flee to the less transparent venue of over-the-counter trading.

"No one could have imagined that you would have a [commodity] energy market develop the way it did," added James Newsome, chief executive of Nymex. "The markets are changing so quickly that there is no way you could keep up with the changes from a rules standpoint."

But Dan Berkovitz, a top Levin aide, said

traders "hesitate when somebody's watching. And when nobody's watching, traders will go wild."