Cheney's Subpoenaed E-Mails Missing

Vice President's email lost for key week in CIA leak probe

MSNBC reports:

When Special Counsel Patrick Fitzgerald wanted to find out what was going on inside Vice President Dick Cheney's office, the prosecutor in the CIA leak probe made a logical move. He dropped a grand jury subpoena on the White House for all the relevant e-mail.

One problem: Even though White House computer technicians hunted high and low, an entire week's worth of e-mail from Cheney's office was missing. The week was Sept. 30, 2003, to Oct. 6, 2003, the opening days of the Justice Department's probe into whether anyone at the White House leaked the identity of CIA operative Valerie Plame.

That episode was part of the picture that unfolded Tuesday on Capitol Hill, where Democrats on a House committee released new information about one of the Bush White House's long-running issues, its problem-plagued e-mail system.

For the first time, a former White House computer technician went public with the details. Steven McDevitt revealed in written statements submitted to Congress how a plan was developed to try to recover the missing e-mail for Fitzgerald.

Ultimately, 250 pages of electronic messages were retrieved from the personal e-mail accounts of officials in Cheney's office, but whether that amounted to all the relevant e-mail is a question that may never be answered.

McDevitt made clear that it was a sensitive issue inside the White House.

"I worked with ... White House Counsel on efforts to provide an explanation to the special prosecutor," McDevitt wrote. "This included providing a briefing to the special prosecutor's staff on this subject."

McDevitt provided no details of the meetings with White House Counsel Harriet Miers and others in the counsel's office in late 2005 and early 2006. The White House refused to comment on those meetings.

White House on defensive

The White House put the best face on a bad hearing Tuesday of the House Oversight and Government Reform Committee, defending the administration's handling of its electronic messages.

McDevitt said that one estimate from a 2005 analysis was that more than 1,000 days of e-mail were missing from January 2003 to Aug. 10, 2005. McDevitt said "the process by which e-mail was being collected and retained was primitive and the risk that data would be lost was high." The "low end" estimate was about 470 days, he added.

The White House says a substantial amount of what had been believed to be missing e-mail had been located.

"We are very energized about getting to the bottom of this" issue, Theresa Payton, chief information officer at the White House Office of Administration, testified to the committee.

"This is a form of sandbagging," replied Oversight Committee Chairman Henry Waxman, D-Calif., who pointed out that by the time the White House fixes its e-mail problems, "you'll be out of office."

E-mail shortcomings

McDevitt's statements detailed shortcomings that he said have plagued the White House e-mail system for six years. He said:

* The White House had no complete inventory of e-mail files.
* There was no automatic system to ensure that e-mail was archived and preserved.
* Until mid-2005 the e-mail system had serious security flaws, in which "everyone" on the White House computer network had access to e-mail. McDevitt wrote that the "potential impact" of the security flaw was that there was no way to verify that retained data had not been modified.
* A new e-mail archiving system that would have addressed the problems was "ready to go live" on Aug. 21, 2006.

Payton told Waxman's committee she canceled the new system in late 2006 because it would have required modifications and additional spending. An alternative system is under way, she said.

Payton's predecessor, Carlos Solari, told the House committee that he was puzzled that the new system had been rejected and that he had "absolutely" believed that the system Payton rejected would be implemented.

When President Bush leaves office, presidential records and federal records at the White House will be turned over to the National Archives. Waxman produced a memo pointing to a lack of cooperation between the White House and the Archives.

"We still know virtually nothing about the status of the alleged missing White House e-mails," the Archives' general counsel, Gary Stern, wrote to his boss last September.

GOP Halts Effort to Retrieve White House E-Mails

Theresa Payton, White House Office of Administration chief information officer, and Allen Weinstein, United States archivist, testify on Capitol Hill. (By Manuel Balce Ceneta -- Associated Press)

The Washington Post reports:

After promising last year to search its computers for tens of thousands of e-mails sent by White House officials, the Republican National Committee has informed a House committee that it no longer plans to retrieve the communications by restoring computer backup tapes, the panel's chairman said yesterday.

The move increases the likelihood that an untold number of RNC e-mails dealing with official White House business during the first term of the Bush administration -- including many sent or received by former presidential adviser Karl Rove -- will never be recovered, said House Democrats and public records advocates.

The RNC had previously told the House Oversight and Government Reform Committee that it was attempting to restore e-mails from 2001 to 2003, when the RNC had a policy of purging all e-mails, including those to and from White House officials, after 30 days. But Chairman Henry A. Waxman (D-Calif.) disclosed during a hearing yesterday that the RNC has now said it "has no intention of trying to restore the missing White House e-mails."

"The result is a potentially enormous gap in the historical record," Waxman said, including the buildup to the Iraq war.

Spokesman Danny Diaz said in a statement that the RNC "is fully compliant with the spirit and letter of the law." He declined further comment.

Administration officials have acknowledged that Rove and many other White House officials routinely used RNC accounts for government business, despite rules requiring that they conduct such business through official communications channels. The RNC deleted all e-mails until 2004, when it exempted White House officials from its e-mail purging policy.

About 80 White House aides used RNC accounts for official government business, committee staff members said. Rove, for example, sent or received 140,000 e-mails on RNC servers from 2002 to 2007, and more than half involved official ".gov" accounts, the panel has said.

The RNC dispute is part of a broader debate over whether the Bush administration has complied with long-standing statutory requirements to preserve official White House records -- including those reflecting potentially sensitive policy discussions -- for history and in case of future legal demands.

The committee is investigating allegations that vast stores of official Bush administration e-mails have also gone missing from the White House, which scrapped a Clinton-era archiving system and has struggled with data retention problems.

A former White House technology manager told the committee in statements released yesterday that the Bush administration's e-mail system "was primitive and the risk that data would be lost was high."

Steven McDevitt, who left the White House in 2006, said he supervised an internal study that found hundreds of days in which no electronic messages were stored for one or more White House offices from January 2003 to August 2005. The study stated a range when tallying the total number of days in which an office had no recorded e-mails, from 473 -- which had been previously reported -- to more than 1,000, McDevitt said.

McDevitt also said security was so lax that e-mail could be modified by anyone on the computer network until the middle of 2005.

Administration officials defended their efforts to fix the problems, and said they are still working to locate and identify e-mails reported as missing. "We are very energized about getting to the bottom of this," said Theresa Payton, chief information officer at the Office of Administration.

At the hearing, Payton and GOP lawmakers attacked the 2005 White House study overseen by McDevitt, calling it flawed and unreliable. McDevitt said the 250-page study involved numerous senior technology officials as well as outside contractors.

Rep. Thomas M. Davis III (Va.), the committee's ranking Republican, said in a statement that the missing e-mail allegations are "based on a discredited internal report conveniently leaked to the media." He also said that yesterday's hearing was "less about preserving records and more about resurrecting the spurious claim that the White House 'lost millions of official e-mails.'"

Davis also said, based on a briefing by Payton, that the actual number of days with missing e-mails was 202. "A substantial portion of the so-called 'missing' e-mails appear not to be missing at all, just filed in the wrong digital drawer," Davis said. No other committee member followed up on that allegation during the hearing.

Politicos Squabble Over 'Missing' White House E-Mails

At NewsBlog, Anne Broache reports:

Democrats and Republicans were warring Tuesday over reports that the White House has "lost"--or simply failed to keep--archives of e-mails belonging to the president and his advisers.

Since last spring, the U.S. House of Representatives Committee on Oversight and Government Reform has been investigating reports that an estimated 5 million messages from 473 days between 2003 and 2005 allegedly vanished from e-mail servers housed within the president's office.

A hearing convened by the committee gave Democratic leaders a new chance to press White House officials publicly on how and when they expect to recover the files.

"We still know virtually nothing about the status of the alleged missing White House e-mails," said Committee Chairman Henry Waxman (D-Calif.).

Allen Weinstein, archivist of the United States, said the National Archives and Records Administration had similarly gotten no response from the White House to its queries about what's going on. "I'm concerned about maintaining the fullest possible presidential records," he told the committee.

Republican leaders said they were also concerned about the prospect of missing nuggets of presidential history, but they accused the Democrats of failing to acknowledge the White House's ongoing efforts to retrieve the messages. Republican Ranking Member Tom Davis (R-Va.) said the White House has said it has since reduced the number of days' worth of missing e-mails from 473 to 202 after discovering that those messages had been filed "in the wrong digital drawer" as part of a switch from the Lotus Notes to Microsoft Exchange e-mail system in 2002.

White House Chief Information Officer Theresa Payton assured the committee that her office is working actively on a multi-step restoration process. Their early results have identified an unspecified number of the previously "missing" messages, though those results still have to be validated.

When pressed by Davis, Payton also said she felt "very comfortable" that they would be able to reconstruct any remaining lost documents from "disaster recovery backup tapes," although she said that process would be time-consuming and could cost at least $15 million.

Did advisers use Republican National Committee accounts?
A separate issue under scrutiny revolves around charges that Karl Rove and some 50 other presidential advisers were using Republican National Committee accounts to conduct official business and thus subvert federal record-keeping laws. The RNC has said it had virtually no records of e-mails sent on its servers by Rove and others before November 2003, which Democrats argue is troubling because those messages may contain important official information about the president's decision to go to war in Iraq.

Waxman said he heard from RNC officials as recently as Monday that the White House had made no effort to request backup tapes from the committee that may contain those files. He scolded White House officials for their inaction. Both Payton and her boss, White House Office of Administration director Alan Swendiman, said they wouldn't be responsible for making such requests but would look into who is.

Republicans accused the Democrats of pursuing the investigation simply to dig up dirt on Rove and waste hundreds of thousands of dollars of money that the RNC could be using to shore up its candidates' campaigns.

"Are we simply going on a fishing expedition at $40,000 to $50,000 a month?" Rep. Darrell Issa (R-Calif.) asked National Archives and White House officials at the hearing. "Do any of you know of a single document, because this committee doesn't, that should've been in the archives but in fact was done at the RNC?"

"I think the issue is always, were there official government public records on that system?" responded Gary Stern, general counsel to the National Archives.

The loss of documents in either case is potentially significant because federal laws, including the Presidential Records Act, requires the White House to preserve all documents related to the president and vice president's official business and turn them over to the National Archives. Personal records, including political campaign-related materials, are expected to be filed separately and not subject to the same restrictions. The matter has already sparked a lawsuit from an advocacy group called Citizens for Responsibility and Ethics in Washington.

Clinton administration's archiving problems
The Bush administration isn't the first to encounter problems with missing e-mails. During the mid-1990s, the Clinton administration at one point relied on a flawed e-mail archiving system that failed, among other things, to preserve e-mails sent by people whose names began with the letter D. The situation resulted in congressional hearings and some $11 million spent on reconstructing the some 200,000 missing e-mails, Waxman said.

The problems for the Bush administration apparently started soon after the White House decided to shift its e-mail system from Lotus Notes to Microsoft Exchange in 2002. It also replaced the automated records storage system devised by the Clinton administration with a system that one of its own experts described as "primitive," according to Waxman.

According to the committee, the archive system is an "ad hoc" process called "journaling," in which a White House staffer or contractor manually copies e-mails and saves them on various White House servers. Democrats cast more than a little suspicion on that practice. They cited testimony outside the hearing from a former White House technology worker who said, at least during some points in 2005, those files and directories were available to all 3,000 employees under the umbrella of the executive office of the president.

White House CIO Payton, who began her job in May 2006, said she was unaware of anything of the sort. She also said she had no knowledge of anyone intentionally deleting or tampering with files and later said the copying of messages is automatic, not manual.

"We want to make sure we get all the e-mails over to the (National Archives) at transition" to the next president, she told the committee.

Briefing: The Power of the Fed

With the economy teetering on recession, the nation’s central bank recently took the unprecedented step of lowering interest rates twice in three weeks. How does the Fed influence interest rates, the economy—and your life?

The Week Daily reports:

What exactly does the Fed do?

It operates like a big dam, regulating the flow of money into the economy. The Fed’s goal is to prevent both “droughts’’—recessions—and “floods’’—inflation. Congress created the Federal Reserve System in 1913, after a string of bank collapses battered the economy and stripped millions of people of their life savings. Today the Fed—a network of 12 government banks spread across the country—is responsible for keeping prices stable and long-term interest rates moderate. That may sound arcane, but the Fed’s machinations affect everything from the price of home loans to whether the economy is adding jobs or losing them. When the Fed manages the economy well, said former Fed official Robert McTeer, “fewer people go to prison, more are healthier because they can afford to take better care of themselves, even the environment gets better taken care of.”

How does the Fed have such a huge impact?

It all stems from its ability to manipulate how much money is available to businesses and individuals seeking loans. When the Fed wants to lower rates, it buys billions of dollars worth of government-backed bonds, thereby pumping money into the banking system. The increased availability of money reduces its cost—that is, the rate of interest. To raise rates, the Fed sells securities, which drains money from the system. By tinkering with rates, the Fed can tighten or loosen the amount of money coursing through the economy. Last August, when bond and stock markets were on the brink of a meltdown, the Fed cut the Fed funds rate by a quarter-point, which pumped $38 billion into the banking system. That reassured investors, who sent the stock indexes soaring, which calmed consumer jitters—at least for a while. “The Fed’s control over the money supply,” said Gregory Mankiw, a former economic advisor to President Bush, “is a powerful lever to move overall demand for goods and services.”

How does the Fed set its rates?

It’s a murky process mostly done in private. The decision to raise or lower rates is made by the Federal Open Market Committee, which includes the Fed chairman, Ben Bernanke, and five regional Fed officials. The panel makes an assessment of the economy, weighing everything from unemployment levels and retail sales to housing starts and manufacturing output. If the economy seems to be slowing, it can cut rates to encourage borrowing and spending. If the economy is overheating, it can raise rates to reduce the risk of inflation. It’s an inexact science. “Policy makers must rely on estimates,” says a Fed publication, “aware that they could act on the basis of misleading information.” The Fed rarely reveals what specific data guided a particular decision, which bothers critics. “The nation pays a terrible price for allowing this cloistered governing institution to evade serious public scrutiny,” said William Greider, author of a critical book on the Fed.

Whom does the Fed answer to?

Pretty much nobody. By design, the Fed is insulated from politics. Its top officials are presidential appointees, but they have staggered terms, so no one president can pack the bank with loyalists. The Fed is funded with interest on the accounts it controls, so Congress can’t use the budget to punish it. But this doesn’t mean the Fed is apolitical. In early 1972, a presidential election year, inflation was accelerating, usually a signal for the Fed to raise rates. Instead, then—Fed Chairman Arthur Burns, formerly a top aide to President Richard Nixon, kept rates low. “The policy helped re-elect the president,” said historian Allen Matusow, “but also assured the next cycle of boom and bust.” In 2001, then–Fed Chairman Alan Greenspan was roundly criticized by Democrats when he said that he did not believe President Bush’s proposed tax cuts would lead to a budget deficit. He turned out to be wrong, but not before he swayed many wavering lawmakers to support Bush’s plan.

Do rate cuts always have their intended effect?

Hardly, and the current financial situation may be a case in point. Banks seldom hesitate to pass on their higher borrowing costs to customers. But they’re not always so quick to share lower costs. Since the Fed’s most recent cuts, corporate loan rates have actually increased, by about 1.25 points, and banks and credit card companies have on average raised, not lowered, the rates they charge consumers. That’s probably because banks are trying to make up for the massive losses they’ve incurred in the mortgage crisis, by borrowing at low rates from the Fed and lending at higher rates to businesses and consumers.

Is there anything the Fed can do about that?

No. The Fed can’t order banks to make loans or lower rates. The Fed, in fact, may be quietly encouraging banks to raise their rates, some analysts say, hoping that this strategy will help banks shore up their mortgage-battered finances. But banks can’t make money on high-priced loans that no one wants. With the economy slowing, consumers are spending and borrowing much less. Businesses, in turn, have less motivation to build new stores and plants and stock up on inventory. When rate cuts fail to stimulate demand for new loans, as is currently the case, the Fed is said to be “pushing on a string.” Given the economy’s rapid deterioration, the Fed may be pushing for some time.

The Prosecution of Governor Siegelman

CBS News reports:

Is Don Siegelman in prison because he’s a criminal or because he belonged to the wrong political party in Alabama? Siegelman is the former governor of Alabama, and he was the most successful Democrat in that Republican state. But while he was governor, the U.S. Justice Department launched multiple investigations that went on year after year until, finally, a jury convicted Siegelman of bribery.

Now, many Democrats and Republicans have become suspicious of the Justice Department’s motivations. As correspondent Scott Pelley reports, 52 former state attorneys-general have asked Congress to investigate whether the prosecution of Siegelman was pursued not because of a crime but because of politics.

Ten years ago life was good for Don Siegelman. After he became governor, many believed he was headed to a career in national politics. In 1999, Siegelman’s pet project was raising money to improve education, so he started a campaign to ask voters to approve a state lottery. He challenged Republicans to come up with a better idea.

“You tell us how you’re going to pay for college scholarships. You tell us how you’re going to put state of the art computers inside every school in this state,” he said.

But now the applause has long faded. Today, Siegelman is at a federal prison camp in Louisiana. He’s doing seven years. The main charge against him was that he took a bribe, giving a position on a state board to businessman Richard Scrushy, who had made a big donation to that lottery campaign. There was a star witness, Nick Bailey, a Siegelman aide who had a vivid story to tell.

“Mr. Bailey had indicated that there had been a meeting with Governor Siegelman and Mr. Scrushy, a private meeting in the Governor's office, just the two of them,” says Doug Jones, who was one of Siegelman’s lawyers. “And then, as soon as Mr. Scrushy left, the governor walked out with a $250,000 check that he said Scrushy have given him for the lottery foundation.”

“Had the check in his hand right then and there? “ Pelley asks.

“Had the check in his hand right then,” Jones says.

“That Scrushy had just handed to him, according to Bailey's testimony?” Pelley asks.

“That's right, showed it to Mr. Bailey. And Nick asked him, ‘Well, what does he want for it?’ And Governor Siegelman allegedly said, ‘A seat on the CON Board.’ Nick asked him, ‘Can we do that?’ And he said, ‘I think so,’” Jones says.

The CON board regulates hospital construction, and Scrushy ran a healthcare company. Both Siegelman and Scrushy were convicted in federal court.

But, as 60 Minutes found out, the imprisonment of Don Siegelman is not nearly as simple as that.

“I haven't seen a case with this many red flags on it that pointed towards a real injustice being done,” says Grant Woods, the former Republican attorney general of Arizona.

Woods is one of the 52 former state attorneys-general, of both parties, who’ve asked Congress to investigate the Siegelman case.

“I personally believe that what happened here is that they targeted Don Siegelman because they could not beat him fair and square. This was a Republican state and he was the one Democrat they could never get rid of,” Woods says.

Now a Republican lawyer from Alabama, Jill Simpson, has come forward to claim that the Siegelman prosecution was part of a five-year secret campaign to ruin the governor. Simpson told 60 Minutes she did what’s called “opposition research” for the Republican party. She says during a meeting in 2001, Karl Rove, President Bush’s senior political advisor, asked her to try to catch Siegelman cheating on his wife.

"Karl Rove asked you to take pictures of Siegelman?" Pelley asks.

"Yes," Simpson replies.

"In a compromising, sexual position with one of his aides," Pelley clarifies.

"Yes, if I could," Simpson says.

She says she spied on Siegelman for months but saw nothing. Even though she was working as a Republican campaign operative, Simpson says she wanted to talk to 60 Minutes because Siegelman’s prison sentence bothers her conscience.

Simpson says she wasn’t surprised that Rove made this request. Asked why not, she tells Pelley, “I had had other requests for intelligence before.”

“From Karl Rove?” Pelley asks.

“Yes,” Simpson says.

Rove was a strategist in Alabama. Simpson says she worked with him on several campaigns.

60 Minutes contacted Rove. Through his lawyer, he denied Simpson’s allegations. One of Rove’s close Alabama associates was Republican consultant Bill Canary. Simpson says she was on a conference call in 2002 when Canary told her she didn’t have to do more intelligence work because, as Canary allegedly said, “My girls” can take care of Siegelman. Simpson says she asked “Who are your girls?”

“And he says, ‘Oh, my wife, Leura. You know, she's the Middle District United States Attorney.’ And he said, ‘And then Alice Martin. She is the Northern District Attorney, and I've helped with her campaign,’” Simpson says.

“Federal prosecutors?” Pelley asks.

“Yes, Sir,” she says.

Bill Canary denies the conversation ever happened. He told 60 Minutes he never tried to influence any government official in the case. His wife Leura Canary and Alice Martin are top federal prosecutors in the state. Both were appointed by President Bush, and their offices investigated Siegelman. Details of some of those investigations leaked to the press. And Siegelman lost his 2002 re-election campaign narrowly to Republican Bob Riley.

Two years later, as Siegelman geared up to run again, the Justice Department took one of its Siegelman investigations to trial-an indictment involving an alleged Medicaid scam.

“He’s indicted. He goes to trial. That's a pretty big deal to have your former governor on trial. Everybody's there. The government gives their opening argument. The judge says, ‘I want to see you in chambers because this case, there's no case here,’" Grant Woods says.

Woods says the judge threw the case out, without a witness testifying. “The case is so lame that he throws it out,” he says.

Vindicated, Siegelman focused on winning the 2006 election. And that’s when Jill Simpson says she heard the Justice Department was going to try again. She says she heard it from a former classmate and work associate Rob Riley, the son of the new Republican governor.

“Rob said that they had gotten wind that Don was going to run again,” she says.

“And Rob Riley said what about that?” Pelley asks.

“They just couldn't have that happen,” Simpson says.

Asked how they were going to prevent that from happening, she says, “Well, they had to re-indict him, is what Rob said.”

Simpson told this same story, under oath, to Congressional investigators in a closed session. Rob Riley told 60 Minutes he never talked to Jill Simpson about this.

Four months after Simpson says they spoke, Siegelman was indicted on new charges. Doug Jones, Siegelman’s lawyer, says one of the prosecutors told him that Justice Department headquarters in Washington had ordered a top to bottom review of the case. Today, the Alabama prosecutors deny that it was Washington - but whoever ordered it, there was a big boost to the investigation.

“They started over. People started getting subpoenas that had never gotten subpoenas before, for testimony, for records. The governor's brother, his bank records started getting subpoenaed. The net was cast much wider than had ever been cast before,” Jones says.

“You know, on the other hand, what's wrong with the Department of Justice vigorously investigating a case if they think there is an indictment to be made on public corruption charges?” Pelley asks.

“Well, you still have to investigate crimes, not people. It undermines the entire system of justice because at that point anybody can be a target. Any prosecutor can look across the table and say, ‘You know what? I just don't like you,’” Jones says.

The prosecution was handled by the office of U.S. Attorney Leura Canary, whose husband Bill Canary had run the campaign of Siegelman’s opponent, Gov. Riley.

“Why would you do it that way?” Woods asks. “Why wouldn't you say, ‘You know what? We're going to bring in someone from another jurisdiction to do it. There's a lot of United States attorneys around the country. We'll have somebody come in and do this case.’ That's not what happened in Alabama. Every time they had the chance to go the extra mile to be independent and objective, they didn't do it.”

Leura Canary handled the case for eight months. When defense attorneys objected, she turned it over to her assistants and says that she had nothing further to do with it.

In this new investigation, prosecutors zeroed in on that vivid story told by Siegelman’s aide, Nick Bailey, who said he saw the governor with a check in his hand after meeting Richard Scrushy. Trouble was, Bailey was wrong about the check, and Siegelman’s lawyer says prosecutors knew it.

“They got a copy of the check. And the check was cut days after that meeting. There was no way possible for Siegelman to have walked out of that meeting with a check in his hand,” Jones explains.

“That would seem like a problem with the prosecution's case,” Pelley remarks.

“It was a huge problem especially when you've got a guy who's credibility was going to be the lynch pin of that case. It was a huge problem,” Jones says.

And there was another problem with the prosecutor’s star witness: Nick Bailey was a crook. Unknown to Siegelman, Bailey had been extorting money from Alabama businessmen. Facing ten years in prison, Bailey agreed to cooperate with prosecutors to get a lighter sentence.

60 Minutes went to talk to Bailey. The Justice Department wouldn’t let our cameras into the prison, but we met with him for hours.

Bailey told 60 Minutes that before the Siegelman trial, he spoke to prosecutors more than 70 times, and he admitted that during those conversations he had trouble remembering details. He told 60 Minutes the prosecutors were so frustrated, they made him write his proposed testimony over and over to get his story straight.

If Bailey’s telling the truth, his notes, by law, should have been turned over to the defense. But Siegelman’s lawyers tell 60 Minutes they never saw any such notes and never had a chance to show the jury just how much Bailey’s story had changed.

No one at the Justice Department would be interviewed for this story, but they did send a statement which read, in part, "This case was brought by career prosecutors … based upon the law and the evidence alone. After considering that evidence … a jury of Mr. Siegelman's peers found him guilty beyond a reasonable doubt.”

But Grant Woods, the former attorney general of Arizona, says the case should never have gone to trial. “The prosecutor's gotta look at it and say, ‘Hey, is this the sort of thing that we're really talking about when we're talking about bribery?’ Because what the public needs to know here is there is no allegation that Don Siegelman ever put one penny in his pocket,” he says.

Richard Scrushy did make donations totaling $500,000 to that education lottery campaign, and after serving on the hospital board under three previous governors, Scrushy was re-appointed by Siegelman.

But Woods says that’s politics, not bribery. “You do a bribery when someone has a real personal benefit. Not, ‘Hey, I would like for you to help out on this project which I think is good for my state.’ If you're going to start indicting people and putting them in prison for that, then you might as well just build nine or ten new federal prisons because that happens everyday in every statehouse, in every city council, and in the Congress of the United States,” he says.

“What you seem to be saying here is that this is analogous to giving a great deal of money to a presidential campaign. And as a result, you become ambassador to Paris,” Pelley remarks.

“Exactly. That's exactly right,” Woods says.

Siegelman was campaigning in the 2006 Democratic primary as he went to trial. “We’re going to turn this bus into what we call the night shift, because after the trial every day we’re gonna be hittin the trail every day,” he said.

But he lost in the primary. After two months, the jury deadlocked twice, then, voted to convict on its third deliberation. Many legal minds were shocked when federal judge Mark Fuller, at sentencing, sent Siegelman directly to prison without allowing the usual 45 days before reporting.

“He had him manacled around his legs like we do with crazed killers. And whisked off to prison just like that. Now what does that tell you? That tells you that this was personal. You would not do that to a former governor,” Woods says.

“Would you do that to any white collar criminal?” Pelley asks.

“No, I haven't seen it done,” Woods says.

“Help me understand something. You're blaming the Republican administration for this prosecution. You're saying it was a political prosecution. You are a Republican. How do I reconcile that?” Pelley asks.

“We're Americans first. And you got to call it as you see it. And you got to stand up for what's right in this country,” Woods says.

Karl Rove and others at the White House were subpoenaed to testify before Congress but they refused to appear. And the Justice Department has refused to turn over hundreds of documents in the case.

A Bloody Stalemate In Afghanistan

Eyes in the Sky: At Camp Blessing, battalion members — led by Lt. Col. Bill Ostlund, far right — watch a monitor showing Capt. Dan Kearney’s troops six miles away. [photos by Lynsey Addario]

In the New York Times magazine, Elizabeth Rubin writes:

We tumbled out of two Black Hawks onto a shrub-dusted mountainside. It was a windy, cold October evening. A half-moon illuminated the tall pines and peaks. Through night-vision goggles the soldiers and landscape glowed in a blurry green-and-white static. Just across the valley, lights flickered from a few homes nestled in the terraced farmlands of Yaka China, a notorious village in the Korengal River valley in Afghanistan’s northeastern province of Kunar. Yaka China was just a few villages south and around a bend in the river from the Americans’ small mountain outposts, but the area’s reputation among the soldiers was mythic. It was a known safe haven for insurgents. American troops have tended to avoid the place since a nasty fight a year or so earlier. And as Halloween approached, the soldiers I was with, under the command of 26-year-old Capt. Dan Kearney, were predicting their own Yaka China doom.

The Korengal Valley is a lonely outpost of regress: most of the valley’s people practice Wahhabism, a more rigid variety of Islam than that followed by most Afghans, and about half of the fighters confronting the U.S. there are homegrown. The rest are Arabs, Pakistanis, Chechens, Uzbeks; the area is close to Pakistan’s frontier regions where Osama bin Laden, Ayman al-Zawahiri and other Al Qaeda figures are often said to be hiding out. The Korengal fighters are fierce, know the terrain and watch the Americans’ every move. On their hand-held radios, the old jihadis call the Americans “monkeys,” “infidels,” ‘’bastards” and “the kids.” It’s psychological warfare; they know the Americans monitor their radio chatter.

As far as “the kids” are concerned, the insurgents are ghosts — so the soldiers’ tactics often come down to using themselves as bait. The insurgents specialize in ambushes, harassing fire and hit-and-run attacks. NATO’s military advantage in such a war is air power. The soldiers don’t hesitate to call in Big Daddy (who, in today’s military, often flies in with the voice of a female pilot). But while these flying war machines are saviors to the soldiers, they cannot distinguish between insurgents and civilians.

I went to Afghanistan last fall with a question: Why, with all our technology, were we killing so many civilians in air strikes? As of September of last year, according to Human Rights Watch, NATO was causing alarmingly high numbers of civilian deaths — 350 by the coalition, compared with 438 by the insurgents. The sheer tonnage of metal raining down on Afghanistan was mind-boggling: a million pounds between January and September of 2007, compared with half a million in all of 2006.

After a few days, the first question sparked more: Was there a deeper problem in the counterinsurgency campaign? More than 100 American soldiers were killed last year, the highest rate since the invasion. Why were so many more American troops being killed? To find out, I spent much of the fall in the Korengal Valley and elsewhere in Kunar province alongside soldiers who were making life-and-death decisions almost every day — decisions that led to the deaths of soldiers and of civilians.

Subduing the Valley

Over the last two years, the Americans have steadily increased their presence in Kunar province, fanning out to the small platoon-size outposts that have become the signature of the new counterinsurgency doctrine in both Afghanistan and Iraq. The Korengal Outpost, nicknamed the KOP, was built in April 2006 on the site of a former timber mill and motel. The soldiers of Battle Company of the 173rd Airborne Brigade Combat Team live there in dusty tents and little wooden huts. They now have hot food and a small chow tent with an Internet linkup and a few phones for calling home. But the place was protected by not much more than concertina wire and sentries. Nearly every time I arrived at the KOP our helicopter was greeted by sniper fire or the dushka — a Russian-made antiaircraft gun.

Dan Kearney was essentially lord of the Korengal Valley. A self-described Georgia army brat, he grew up idolizing his warrior dad, Frank Kearney, and wanted to move in his father’s world of covert and overt operations. (His father is now a lieutenant general in Special Operations command.) Kearney often calls himself a dumb jock, playing the crass, loudmouthed tough guy with his soldiers. He had been in Iraq and told me he had gone emotionally dead there with all the dying and killing, and stayed that way until the birth of his son a year ago. His hardest day in Iraq was when a close friend, Rob Shaw, was severely wounded by an improvised explosive device that killed his first sergeant and a bunch of their friends — and the next thing he knew their colonel was asking Kearney to step in for Shaw and lead the company.

But as hard as Iraq was, he said, nothing was as tough as the Korengal. Unlike in Iraq, where the captains and lieutenants could let down their guard in a relatively safe, fortified operating base, swapping stories and ideas, here they had no one to talk to and were almost as vulnerable to enemy fire inside the wire as out. Last summer, insurgents stormed one of the bases in a nearby valley and wounded 16.

And unlike every other place I’ve been in Afghanistan — even the Pech River valley, just an hour’s drive away — the Korengal had no Afghan police or district leaders for the Americans to work with. The Afghan government, and Afghans down the valley, seemed to have washed their hands of the Korengalis. As Kearney put it to me one day at the KOP, the Korengal is like a tough Los Angeles neighborhood, “and we’re the L.A.P.D. kicking in the door, arresting guys, demanding information about the gangs, and slowly the people say, ‘No, we don’t know anything, because that guy in the gang, he’s with my sister, and that other guy, he’s my uncle’s cousin.’ Now we’ve angered them for so many years that they’ve decided: ‘I’m gonna stick with the A.C.M.’ ” — anticoalition militants — “ ‘who are my brothers and I’m not gonna rat them out.’ ”

So what exactly was his job out here? To subdue the valley. It’s a task the Marines had tried, and then the soldiers of the Army’s 10th Mountain Division — a task so bloody it seemed to drive the 10th Mountain’s soldiers to a kind of madness. Kearney’s soldiers told me they’d been spooked by the weird behavior of their predecessors last May: near the end of their tour, many would sit alone on the fire base talking to themselves. Privates disobeyed their sergeants, and squad leaders refused to step outside the wire to show the new boys the terrain. No one wanted to be shot in the last days of his tour.

Kearney kept his soldiers on a tight leash at first. Col. John Nicholson, a brigade commander with the 10th Mountain Division, had promised the Afghans he would not bomb their homes. When Kearney and the 173rd Airborne Brigade Combat Team officially took over from the division’s 3rd Brigade Combat Team on June 5, they kept that promise. “My guys would tell me they didn’t know which houses they’re shooting from, and I’d tell them they can’t shoot back into the villages,” Kearney recalled. “They hated me.” The insurgents were testing the new captain, he suspected, by deliberately shooting from homes. On July 10, the Korengalis ambushed his soldiers from one house they often used — a three-story mansion on a fertile outcropping, with balconies overlooking the valley, that belonged to Haji Matin, a timber baron turned insurgent leader. It had been the scene of fighting in the past.

When Kearney’s moment of decision came, two of 2nd Platoon’s sergeants, Kevin Rice and Tanner Stichter, had been shot, and the fight was still going on. Kearney could see a woman and child in the house. “We saw people moving weapons around,” Kearney told me. “I tried everything. I fired mortars to the back side to get the kids to run out the front. I shot to the left, to the right. The Apache” — an attack helicopter — “got shot at and left. I kept asking for a bomb drop, but no one wanted to sign off on the collateral damage of dropping a bomb on a house.” Finally, he said, “We shot a javelin and a tow” — both armor-piercing missiles. “I didn’t get shot at from there for two months,” Kearney said. “I ended up killing that woman and that kid.”

Kearney could often sound cold-blooded, like when he’d march into the mess tent in shorts, improvising rap lyrics about killing bad guys. But then he’d switch to counselor, trying to salvage a soldier’s marriage, or he’d joke with a Korengali elder about arranging a marriage between his own infant son and the elder’s daughter to make peace. The performances steeled him against shouldering so much mortality. As he put it, “The only reason anyone’s listening to me in this valley right now is ’cause I’m dropping bombs on them.” Still, he wasn’t going to let himself shoot at houses every time his unit took fire: “I’d just create more people that hate me.”

A Blood Feud

In late 2001, the B-52 symbolized, for many Afghans, liberation from Taliban rule. They wove images of the plane into their carpets. Urban legends sprang up about the B-52’s power, how the planes glided along unscathed, even as the Taliban barraged them with antiaircraft fire. Kabulis spread the story that the B-52s had dropped thousands of leaflets saying, “Hit us if you can!” — and afterward the Taliban didn’t waste their bullets on the B-52s.

But the jets that defeated the Taliban were wiping out innocent families as well. In July 2002, Special Forces in the mountains of Oruzgan thought they were destroying a high-value Taliban target, but instead they rocketed and bombed an engagement party. About 40 Afghans were killed and nearly 100 were wounded.

Such mistakes have continued, though the causes can change. The insurgents regularly use civilians as shields, children as spotters and women as food suppliers. NATO killing civilians is great propaganda for the Taliban. At the same time, to Afghans with little technological sophistication, the scale and impersonality make the accidents seem intentional. Many are convinced the Americans are deliberately bombing them and even deliberately aiding a Taliban comeback. The reality is that bombs are only as accurate as the intelligence on the ground — and since 9/11, the U.S. and NATO have used air power as a substitute for ground troops.

By now, seven years of air strikes and civilian casualties, humiliating house searches and arbitrary detentions have pushed many families and tribes to revenge. The Americans then see every Afghan in those pockets of recalcitrance as an enemy. If you peel back the layers, however, there’s always a local political story at the root of the killing and dying. That original misunderstanding and grievance fertilizes the land for the Islamists. Whom do you want to side with: your brothers in God’s world or the infidel thieves?

Hostile Fire: U.S. troops carry the body of Staff Sgt. Larry Rougle, who was killed when the insurgents ambushed their squad in the Korengal Valley. More Photos >
In the case of the Korengal Valley, the story began about a century ago, when the tribesmen now known as Korengalis were kicked out of the province of Nuristan (immediately north of Kunar province) and settled in the Korengal, which was rich with timber forests and farmland. Over time they made an alliance with one branch of the large Safi tribe, which once dominated Kunar politics. But down the road along the Pech River valley, the rest of the Safis opposed the Korengalis.

As the Afghans tell the story, from the moment the Americans arrived in 2001, the Pech Valley timber lords and warlords had their ear. Early on, they led the Americans to drop bombs on the mansion of their biggest rival — Haji Matin. The air strikes killed several members of his family, according to local residents, and the Americans arrested others and sent them to the prison at Bagram Air Base. The Pech Valley fighters working alongside the Americans then pillaged the mansion. And that was that. Haji Matin, already deeply religious, became ideological and joined with Abu Ikhlas, a local Arab linked to the foreign jihadis.

By 2007, the Americans understood what happened. Last year, the governor of Nuristan even sat them down with the Korengali elders to try and mediate between the two sides. Nothing came of it. Kearney tried to dig deeper, sending e-mail messages to anthropologists and Afghan experts to get their guidance. He spent hours listening to Haji Zalwar Khan — who acted as the valley’s representative to the Americans and the government — talk about history and grievances. Haji Zalwar, a jihadi veteran of the anti-Soviet fight, bore the valley’s burden almost alone and had the grim demeanor to prove it. Kearney met as many villagers as possible to learn the names of all the elders and their families. But he inherited a blood feud between the Korengalis and the Americans that he hadn’t started, and he was being sucked into its logic.

“Serious P.T.S.D.”

Last autumn, after five months of grueling foot patrols up and down the mountains, after fruitless encounters with elders who smiled in the morning and were host to insurgents in the evening and after losing friends to enemy fire, Captain Kearney’s men could relate to the sullen, jittery rage of their predecessors in the 10th Mountain Division. Many wondered what they were doing out there at all.

Kearney refused to entertain that thought. He would tell his visitors, whether generals or reconstruction teams, that his campaign plan was clear, if modest: “It’s World War II Pacific-island hopping, turning one village at a time.” Over five months, he had gained about 400 yards of terrain. When some generals and colonels had flown in for a quick tour, and Kearney was showing them the lay of the land, one officer said to another, as Kearney later recalled it, “I don’t know why we’re even out here.” Another officer jumped in to talk up the logic of the operation. Kearney told me he thought: Sort your stuff out before you come out here. My boys are sucking it up and dying. . . . For besides being lord of the valley, he had another role to play — motivator, disciplinarian and confidant to his soldiers. “It’s like being in charge of a soap opera,” he told me. “I feel like Dr. Phil with guns.”

One full-moon night I was sitting outside a sandbag-reinforced hut with Kearney when a young sergeant stepped out hauling the garbage. He looked around at the illuminated mountains, the dust, the rocks, the garbage bin. The monkeys were screeching. “I hate this country!” he shouted. Then he smiled and walked back into the hut. “He’s on medication,” Kearney said quietly to me.

Then another soldier walked by and shouted, “Hey, I’m with you, sir!” and Kearney said to me, “Prozac. Serious P.T.S.D. from last tour.” Another one popped out of the HQ cursing and muttering. “Medicated,” Kearney said. “Last tour, if you didn’t give him information, he’d burn down your house. He killed so many people. He’s checked out.”

As I went to get some hot chocolate in the dining tent, the peaceful night was shattered by mortars, rockets and machine-gun fire banging and bursting around us. It was a coordinated attack on all the fire bases. It didn’t take long to understand why so many soldiers were taking antidepressants. The soldiers were on a 15-month tour that included just 18 days off. Many of them were “stop-lossed,” meaning their contracts were extended because the army is stretched so thin. You are not allowed to refuse these extensions. And they felt eclipsed by Iraq. As Sgt. Erick Gallardo put it: “We don’t get supplies, assets. We scrounge for everything and live a lot more rugged. But we know the war is here. We got unfinished business.”

For sanity, all they had was the medics’ tent, video games and movies — “Gladiator,” “Conan the Barbarian,” “Dogma,” Monty Python. Down the road in the Pech Valley, soldiers played cricket with Afghan kids and had organized boxing and soccer matches. Lt. Kareem Hernandez, a New Yorker running a base on the Pech River, regularly bantered over dinner with the Afghan police. Neighbors would come by with tips. But here in the Korengal, the soldiers were completely alienated from the local culture. One night while watching a scene from HBO’s “Rome” in which a Roman soldier tells a slave he wants to marry her, a soldier asked which century the story was set in. “First B.C. or A.D.,” said another soldier. The first shook his head: “And they’re still living like this 800 meters outside the wire.”

At the end of the summer, Kearney told his dad, “My boys are gonna go crazy out here.” The army sent a shrink, and Kearney got a wake-up call about his own leadership. He discovered that half his men thought he was playing Russian roulette with their lives and the other half thought he stuck too closely to the rules of engagement. “The moral compass of the army is the P.L. and the C.O.” — the platoon leader and the commanding officer, Kearney told me. “I told every one of my P.L.’s that they have to set that moral standard, that once you slip to the left, you can’t pull your guys back in.”

Operation Rock Avalanche

On October 19, Kearney and Battle Company were air assaulted into the insurgents’ backyard for a mission that many thought insane. It was called Rock Avalanche and would last about six days. One of its main targets was the village of Yaka China.

Kearney, being the good soldier, tried to pump up his boys with the promise that they would be going after insurgents who had killed their friends and whose grizzled faces were plastered on their bad-guy family-tree wall at the KOP. They would upset the guerrillas’ safe haven and their transit routes from Pakistan. They would persuade the villagers to stop harboring the bad guys by offering an $11 million road project that had just been approved by NATO and Kabul and would be built by the Kunar Provincial Reconstruction Team. And they’d complete the “human terrain mapping” that is part of the new counterinsurgency doctrine — what families dominate, who’s married, who’s feuding, are there divisions to be exploited?

It was a lot to ask of young soldiers: play killer, cultural anthropologist, hearts-and-minds winner and then killer again. Which is why, just hours before the mission was to begin, some soldiers were smearing black-and-green war paint on their faces when their sergeant shouted: “Take it off. Now!” Why? They’d frighten the villagers.

It seemed a moot point as Rock Avalanche got under way. Apache gunships were scanning the ridges for insurgents. Other helicopters were dropping off more soldiers. An unmanned drone was whining overhead as it sent infrared video feeds to a large screen back at the battalion’s headquarters, Camp Blessing, six miles north of the KOP.

Almost immediately, high on a mountainside looking down on Yaka China, Kearney had to play God. In a ditch to his left, Jesse Yarnell, a young intelligence officer, along with John, an Afghan interpreter, were intercepting insurgents on their two-way radios saying, “We see them, we’re going to wait.”

“They’re right down there!” said Kevin Caroon as he gazed out of his night vision. Caroon, from Connecticut and a father of two, was an Air Force JTAC — the joint terminal attack controller who talks the combat pilots onto their targets. “See that? Two people moving south 400 meters away from us,” Caroon said, pointing down the mountain face. More insurgents were located nearby.

“Sir, what do you want to do?” Caroon asked Kearney.

“I want them dead,” Kearney said.

“Engage them?”

“Yes. Take ’em out.”

Caroon radioed the pilot his instructions, “On-scene commander’s intent is to engage.” And that was it.

A sudden wail pierced the night sky. It was Slasher, an AC-130 gunship, firing bullets the size of Coke bottles. Flaming shapes ricocheted all around the village. Kearney was in overdrive. The soldiers back at the KOP were radioing in that the drone was tracking 10 men near the tree line. Yarnell was picking up insurgent radio traffic. “They’re talking about getting ready to hit us,” someone said. The pilot could see five men, one entering a house, then, no, some were in the trees, some inside, and then, multiple houses. He wanted confirmation — were all these targets hostile? Did Kearney have any collateral-damage concerns? Cursing, Kearney told them to engage the men outside but not to hit the house. The pilots radioed back that men had just run inside. No doubt there would be a family. Caroon reminded Kearney that Slasher had only enough fuel to stay in position for 10 more minutes.

“What do you want to do, sir?” Caroon asked him.

Kearney radioed his soldiers back at the KOP to contact his boss, Lt. Col. Bill Ostlund. Ostlund, a Nebraska social scientist who could switch effortlessly from aggressive bomber to political negotiator talking family values with Afghan tribal elders, was in the crowded tactical-operations room at Camp Blessing watching the drone’s video feed and getting the same intelligence. He signed off on collateral damage, and Kearney turned to Caroon: “Take out the compound. And anyone that comes out.”

Flaming rockets flashed through the sky. Thunder rumbled and echoed through the valley. Then there was a pause. Slasher asked Caroon whether the insurgents were still talking. Kearney shouted over to Yarnell in his ditch, “You picking anything up?” Nothing. More spitting rockets.

The night seemed incomprehensible and interminable. Slasher departed and Gunmetal — an Apache helicopter — swept in. Radio communication kept breaking down. At one point the crew of Gunmetal, sensing no hostile intent, refused Kearney’s orders to fire. Then suddenly Gunmetal was rocketing at figures scattering for cover. Then Slasher was back in the sky doing more “work.” In the predawn light Bone — the nickname for the B-1 bomber that seemed to be the soldiers’ favorite — winged in and dropped two 2,000-pound bombs above the village. Finally, around dawn, a weary Kearney, succumbing to gallows humor, adrenaline and exhaustion, said: “O.K., I’ve done my killing for the week. I’m ready to go home.”

Kearney estimated that they killed about 20 people, adding: “I’m not gonna lie. Some are probably civilians.”

In the logic of war, the best antidote for the menacing ghostliness of the ambushing enemy is killing and knowing you’ve killed them. The soldiers in the Korengal almost never had that kind of satisfaction. Any insurgents, if they were killed, would be buried fast, and all that was left in their wake were wounded civilians. That morning, after a long night of fighting, was no different. Within an hour or so, Lt. Matt Piosa, an earnest, 24-year-old West Point grad, and his patrol were in Yaka China. They radioed that the village elders were asking to bury their dead. They’d also collected wounded civilians. The tally was bad — 5 killed and 11 wounded, all of them women, girls and boys.

Kearney radioed Camp Blessing the bad news and dropped his head between his knees. Killing women and children was tragedy enough. But civilian casualties are also a political issue. If he didn’t manage to explain his actions to the Yaka China villagers and get them to understand his intentions, he could lose them to the enemy. Meanwhile, Yarnell and his team were intercepting radio messages like: “Be very quiet. Move the things over here. Pray for us.” At least some of the insurgents from the previous night’s fight had survived to fight again. The planes were tracking them hiding along a creek. But after the civilian casualties of the night before, senior commanders were refusing to give Kearney clearance to bomb or rocket them.

The short day was fading. The sun dropped behind the peaks. The cold winds rattled our bones. The soldiers tried to make light of their conviction that they’d be attacked by those insurgents dissolving into the villages. Their fears were realized.

Hearts and Minds

To try to acquire allies, Kearney and some of his men flew down the next day to Yaka China. With nowhere else to land, the Black Hawk helicopters descended on the roof of a house not far below the compound that Slasher, the AC-130, had rocketed the night of the 19th. Dust and dried grass whipped across the house and the villagers’ faces. Just to endear themselves even more, the soldiers from Battle Company had to step on harvested corn as they climbed down; it was drying on the second story.

The adversaries faced off in the courtyard as chickens sprinted in and out. On one side were Kearney, Ostlund and Larry LeGree, a naval nuclear engineer and head of the Provincial Reconstruction Team, together with their entourage, including interpreters, all in futuristic high-tech gear. On the other side were the Korengali elders, who looked as if they stepped out of “Lord of the Rings” with their crooked walking sticks, beards dyed red and blue eyes framed by kohl. With no Afghan government out here, the elders are the only channel for communication. The younger men sat on the ground, wrapped in shawls and bold indifference.

Kearney squatted and told the Korengalis that when he came to this region he hoped to walk into Yaka China and find out what the villagers needed. Instead, he found that there were some 50 insurgents in and around the village. He pointed to the evidence — military radio batteries that his men had found, binoculars, rockets, an old pistol, a small pamphlet titled, in Arabic, “How to Kill,” and one in Pashto, “The Concise Book on the Virtues of Jihad” — that had been collected in the general area by Afghan soldiers and Americans. It was not a very incriminating haul, and everyone knew it.

The day before, a U.S. medevac had airlifted out the wounded civilians from the village. Humanitarian assistance was air-dropped in, including concrete for retaining walls, rice and blankets for winter. The provisions were not compensation, Kearney told the elders. “It’s what the government does for their people when there is security here,” he said. He asked them to tell him where in the mountains the insurgents were hiding their supplies. “That way I don’t have to come in here and shoot at you and identify the good guys from the bad guys,” he said.

To keep his bearings amid the hostile faces, Kearney kept appealing to Haji Zalwar Khan, the leading go-between among the valley’s elders. He made his fortune in the timber trade and blamed the Americans for shutting it down. He tried to placate both the Americans and the insurgents. He was not about to side with Kearney in public. “How can I know where you found these things?” he asked, referring to the jihadi items. “In the mountain? The house? How do I know whom they belong to?”

Kearney smiled. He was getting used to the routine between the Americans and the villagers — miscommunication and deception. The encounter felt as much performative, a necessary part of the play, as substantive. And I wondered how Kearney was going to keep his sanity for 10 more months.

Just a week or so earlier, I had been at the KOP when villagers from Aliabad — a mile south of the KOP, and the home village of Haji Zalwar Khan — complained to Kearney that some ordinance had hit a house. Later they sent up the homeowner’s teenage son to wrest compensation from Kearney. As we walked to the KOP’s entrance to meet the boy, a shot rang out, then another. The bullets smacked the dirt in front of us. Kearney shoved me into a shack where an Afghan was cooking bread. A few more shots were fired. It was “One-Shot Freddy,” as the soldiers refer to him, an insurgent shooter everyone had a theory about regarding the vintage of his gun, his identity, his tactics — but neither Kearney’s scouts nor Shadow the drone could ever track him. I accidentally slashed my forearm on a nail in the shack and as I watched the blood pool I thought that if I had to live with Freddy and his ilk for months on end I, too, would see a forked tongue in every villager and start dreaming of revenge.

Kearney was angry. “Taliban shot your house?” he asked the boy from Aliabad. An interpreter translated.

No, said the boy, Americans did.

“What’d we shoot with?”

“I don’t know the weapon, but there’s little holes and two big holes.”

“I didn’t shoot into Aliabad,” said Kearney, adding that if one of his soldiers had, it was because insurgents were firing from the village.

“No one shoots from the village,” said the boy, though everyone knew insurgents had wounded several of Kearney’s soldiers by shooting from the mosque, the cemetery, the school. . . .

The boy changed course, “God knows better than me,” and that sent Kearney on a riff: “Yes. God does and God talks to me and told me they do.” And by the way, hadn’t the boy noticed that the bad guys always start shooting first?

“O.K., then shoot them, not our house,” the boy said.

“Then tell me where the bad guys are,” Kearney said. The boy said he didn’t know. What he knew was that the Americans were always shooting at the village.

This went on for some time. When the boy again protested that no one shoots from his village, Kearney interrupted him. “Aminullah does,” he said. Aminullah was a native of Aliabad and a rising figure in the valley’s insurgency.

The boy smiled.

“You’re smiling because you know I’m right,” Kearney said.

“You’re right,” the boy said. “So shoot the cemetery, not our house.”

Kearney moved closer to him. “Look, if you want help with your house, all you have to do is ask. But don’t accuse us every time something goes wrong.”

The boy laughed and repeated that he didn’t know where the bad guys were.

“It’s crazy, man. They must be ghosts!” Kearney said, laughing.

“Aminullah doesn’t come to Aliabad anymore,” the boy said, perhaps trying to give Kearney a bone.

Kearney leapt at it. “So Aminullah is bad?”

“Yes.”

“Ah! Finally! We’re getting somewhere.” Kearney took off his helmet and squeezed his hands together and rocked as he sat on a wall. “What about Mohammad Tali, he’s a good guy isn’t he?” Kearney asked.

Smiling again, the boy looked at the dirt: “No. You already told us he’s a bad guy.”

“Ah!” Kearney said, throwing up his hands. “So you were down there in the village when I gave radios and food. But instead you say I shoot at you all the time?” Kearney swung his legs back and forth. “Hey dude, ask yourself. Why would I bring you radios and food and shoot at you? Does Aminullah? No. What happened that day after I left?” The boy said all he knew was that the villagers went home and “they” started shooting. “Where?” Kearney asked, “from your village?”

“What can I say? The Americans were in my village.”

“Yeah, so I was doing good stuff for you guys and they shot at me. And what I’m trying to say is they could have shot at you again. And if I shoot at your house I’ll help. We’ll fix up that wall. I’m not here to hurt you.”

Everyone was getting restless in the little check post. Kearney tried to lighten up a bit. He asked the boy what he thought about the Americans.

“You build roads and clinics and schools and are here to help,” the boy said.

“Cop out,” Kearney shouted, chuckling. “Easy answer. Hey dude, you can say we’re rotten and messing up your lumber trade.” The boy laughed. Kearney laughed. Pfc. Michael Cunningham, the radio operator, and Sgt. Taylor White, who always manned the check post, both laughed.

“See, I knew it,” Kearney said. “That’s what you really think. Think I want to be here?”

“Yeah,” the boy said. “I think so.”

“Dude. I got a wife and son. I came here to help you out. If you give me as much help as possible I’ll get out of here a hell of a lot faster.”

Kearney told him to enjoy Ramadan, and then shouted, “Where’s my fuzzy friend?” as he looked about for Jericho, the puppy whose ears were chopped off by an Afghan worker: it was pre-emptive preparation for dog fighting — the ears would just give an enemy dog something to grab onto. “I need someone to make me happy. Jericho, I need some love.” Jericho appeared, leaping about. Kearney picked him up. “Hey, what’s up buddy? You’re a good boy. You smell like dirt.”

Kearney turned to Cunningham and White and said, “Well, he’s the first to admit Aminullah’s bad.” And give or take a little unreliable information shared here and there, that was the Korengal routine.

Fight Time

The day after the meeting with the elders of Yaka China, Yarnell and John could hear insurgents trying to pinpoint where Kearney and his men were. The helicopters had moved us to a ridge line, about 8,400 feet high, straddling the Korengal and Shuriak Valleys. The insurgents used the deep caves, boulders and forests as hideouts and transit routes between Pakistan and Afghanistan. We could hear someone who called himself Obeid saying he’d do whatever the Yaka China elders decided — whether to cooperate with the Americans or take revenge. By evening the elders had apparently reached their verdict. It was fight time.

Kearney, too, had reached a verdict. He would fool the insurgents, feigning a troop extraction when the helicopters came for resupply and pushing out his best guys in small “kill teams.” We heard the insurgents say, “We have wolves on them,” meaning spotters. A hoarse, whispering insurgent had eyes on either Sgt. Larry Rougle and his scouts or on Lieutenant Piosa and his rear guard. There was joking that Rougle and Piosa should dance and see which one the whisperer was spying on. Then nothing happened for almost 24 hours.

Rougle — who was called Wildcat — was on his sixth deployment since Sept. 11, 2001. He was with the first group of Rangers in Afghanistan. Even his rough background was something of a legend; he would tell how he grew up in a South Jersey gang, shot a guy, went to “juvie,” and there taught himself Russian (though he was estranged from his Russian father), taught himself politics, history, zoology. At night out in the woods, he’d tell his fellow scouts, “You know penguins are monogamous?”

I hung out with Piosa and his crew. His white skin, red hair and blue eyes belied the months of constant warfare he and his platoon had scraped through. It was a beautiful autumn afternoon and the soldiers were joking around, heating up Meals Ready to Eat, spitting gobs of Copenhagen and then, in a moment, recess was over. The insurgents were on them. Bullets ricocheted all through the woods. A strange silence fell as everyone scrambled for cover. Three of us crouched behind a skinny pine tree. And the silence broke: curses, shouting.

“Where’s it coming from?”

“Where are my guys?”

“Jones, are you seeing things?”

More bullets. Cracks against the tree trunks. Bits of confusing information were coming in on Piosa’s radio.

“They’re comin’ up the low ground at 2-4” — Sergeant Rice’s call sign.

“One W.I.A. hit in the arm.” Then there was panic and screaming.

“The enemy’s overtaken the hill,” bellowed Pvt. Sterling Dunn from further down the trees.

“2-4 is hit” — that was Rice.

“Wildcat is run over the hill” — that was Rougle.

“Get a team to run up there and take that hill. They pushed Wildcat over the hill!” Piosa shouted, trying over and over to reach Rice and Rougle, but getting no answer. The battalion surgeon, Capt. Joel Dean, and a sergeant sprinted up the hill to get to the wounded. As the first Americans neared Rice and Rougle’s positions they were fired on from those same positions. What was going on?

I followed Piosa through the brush toward the ridge. We came upon Rice and Specialist Carl Vandenberge behind some trees. Vandenberge was drenched in blood. The shot to his arm had hit an artery. Rice was shot in the stomach. A soldier was using the heating chemicals from a Meal Ready to Eat to warm Vandenberge and keep him from going into shock.

Piosa moved on to the hill where the men had been overrun. I saw big blue-eyed John Clinard, a sergeant from North Carolina, falling to pieces. He worshiped Rougle. “Sergeant Rougle is dying. It’s my fault. . . . I’m sorry. . . . I tried to get up the hill. . . .” Sergeant Rougle was lying behind him. Someone had already covered him with a blanket. Only the soles of his boots were visible.

“There’s nothing you could do,” Piosa said, grabbing Clinard’s shoulder. “You got to be the man now. You can do it. I need you to get down to Rice and Vandenberge and get them to the medevac.” Clinard wiped his face, seemed to snap to and headed off through the trees.

Two of Rice’s squad mates appeared, eyes dilated. They couldn’t believe they’d seen, up close, the ghosts they’d been fighting for the last five months. “I saw him in the eyes,” Specialist Marc Solowski said. “He looked at me. I shot him.” He and Specialist Michael Jackson had crawled up the hill twice trying to retake it. Each time the insurgents in “manjammies” whipped them back with machine-gun fire. There was blood on the stones around us. Some thought they saw blood trailing down toward the village of Landigal, where they were sure an insurgent had dashed into a cottage.

“We’re not losing this hill again,” Piosa shouted. “This hill is ours!” He wanted bombs to be dropped immediately.

“There’s women praying in that house,” Dunn shouted back.

I was fixating on Rougle’s black hat, lying by the bloodied rock patch where Dunn was sitting, when Sergeant Stichter, Dunn’s senior, appeared, out of breath and shaking, back from tending to Vandenberge. He needed water. The F-15 known as Dude was en route, the Apaches were chasing men and Kearney — who had bolted down the mountain, throwing grenades in caves — was barking orders. Kearney was badly shaken. He adored Rougle, and he’d broken down when he saw his big old buddy Rice bleeding at the landing zone. Rice comforted him and then lumbered to the helicopter, just asking to talk to his wife before they put him under.

The insurgents had run off with some of Rougle, Rice and Vandenberge’s stuff — ammunition, communication equipment, night vision goggles, machine guns. Kearney wanted the equipment back. He wanted to punish the valley. Stichter had his eyes on a guy pacing a rooftop in Landigal and wanted to blow his head off. Specialist Mitchell Raeon, whose uniform was now soaked in Rougle’s blood, had the guy in his scope but couldn’t range that far. “That’s a female,” Dunn said.

Kearney had identified insurgents who’d dashed into a house and wanted to hit them, but Stichter got back word from Camp Blessing saying the target was too close to other houses. Kearney sent back a reminder — you let some guys get away the other night. It was impossible to know for sure, but Kearney believed they were the guys who had killed Rougle, and now, he said, you’re going to let another group get away?

Someone cursed, then said, “They’re all leaving the house.”

Kearney radioed down to one of his lieutenants at an observation post. “Where are they going?” Yarnell heard the insurgents say they were coming back for the rest of the equipment. And then, with no warning, an F-15 dropped a bomb on Landigal, but off target, or so it seemed. Kearney was furious. He was sure headquarters had intentionally missed the house he had wanted hit.

I noticed Raeon was packing and unpacking Rougle’s things. Rougle’s scouts were in disarray, rudderless, and admitting it. Raeon said he kept seeing in his mind Rougle’s face alert and then dead, switching back and forth; he wanted it to stop.

The next day brought another brief firefight, and Rougle’s scouts rallied swiftly. They said they felt him watching and proud. There were more bomb drops and refusals to drop bombs, and then Becky, everyone’s favorite Apache pilot, swept in. Not only did she offer the comforting voice of a woman seeping right into their ears, but Becky was one of the most aggressive shooters. She flew up and down the canyon walls seeking out and rocketing insurgents. We heard them on the radio again boasting about retreating to safety under fire. They talked about the strike in Landigal that they thought might have killed Azizullah — “a real bad guy,” the radio operator told me.

Kearney was watching a crow flying above us. “Taliban are right,” he said. “Like they said yesterday, follow the birds, they follow the Americans. I wish I was made as strong as haj” — their nickname for insurgents. “They were balls to do what they did. And guess what? I’m not gonna lie. They won.”

Killing Together

As we waited for dusk to get back to the KOP, we all knew the insurgents were nearby, eyes on Kearney, eyes on the soldiers down in the valley. Even nightfall was no comfort because the full moon was floodlighting the Korengal. I returned to the KOP by helicopter with Kearney, while 1st and 2nd Platoons had to make the long trek back on foot. As soon as 1st Platoon set off, the insurgents struck with a devastating L-shaped ambush. All Kearney could do, back at the KOP, was calm his boys on the radio, get in the medevac and invoke the gods of war. The Apaches, Slasher and Bone dropped bombs all night. The soldiers and insurgents were so close that when Slasher, the AC-130, flew in, the pilot coordinated not with the JTAC but with Sgt. Roberto Sandifer, the platoon’s forward observer, who at that moment was under fire watching one of his guys die.

Around midnight, 1st Platoon filed into the KOP, eyes bulging, drenched in sweat, river water and blood. They were hauling the belongings of Mohammad Tali, a high-value target. Specialist Sal Giunta had killed him.

The next day I climbed up to the KOP and found Specialist Giunta, a quiet Iowan lofted into a heroism he didn’t want. His officers were putting him up for a medal of honor. Giunta told me the story of that night, how they’d barely moved 300 yards before they were blasted. Giunta was fourth in the file when it happened, and he jumped into a ditch. He couldn’t figure out why they were getting hit from where Joshua Brennan and baby-faced Franklin Eckrode should have been leading up ahead. He knew it must be bad, but as he leapt up to check he got whacked with a bullet in his armored chest plate. It threw him down. They were taking fire from three sides. He grabbed some grenades: “I couldn’t throw as far as Sergeant Gallardo. We were looking like retards and I decided to run out in front of the grenades.” He found Eckrode with gunshot wounds. “He was down but moving and trying to fix his SAW” — a heavy machine gun — “so I just kept on running up the trail. It was cloudy. I was running and saw dudes. Plural.”

He couldn’t figure out who they were. Then he realized they were hauling Brennan off through the forest. “I started shooting,” he recalled. “I emptied that magazine. They dropped Brennan.” Giunta scrambled up to Brennan. He was a mess. His lower jaw was shot off. “He was still conscious. He was breathing. He was asking for morphine. I said, ‘You’ll get out and tell your hero stories,’ and he was like, ‘I will, I will.’”

They were still taking fire. No one was there to help. Hugo Mendoza, their platoon medic, was back in another ditch, calling: “I’m bleeding out. I’m dying.” Giunta saw Brennan’s eyes go back. His breathing was bad. Giunta got Brennan to squeeze his hand. A medic showed up out of the sky. They prepared Brennan to be hoisted to the medevac in a basket. Soon he would be dead.

As the medevacs flew out, Sergeant Sandifer had talked in air cover: Slasher, the AC-130. The pilot was a woman and, Sandifer later told me, “It was so reassuring for us to hear her voice.” She spotted guys hiding and asked if she was clear to engage. “ ‘You’re cleared hot,’ I told her. And we killed two people together.” But, at this point, the killings were no consolation to Sandifer.

As Giunta said, “The richest, most-trained army got beat by dudes in manjammies and A.K.’s.” His voice cracked. He was not just hurting, he was in a rage. And there was nothing for him to do with it but hold back his tears, and bark — at the Afghans for betraying them, at the Army for betraying them. He didn’t run to the front because he was a hero. He ran up to get to Brennan, his friend. “But they” — he meant the military — “just keep asking for more from us.” His contract would be up in 18 days but he had been stop-lossed and couldn’t go home. Brennan himself was supposed to have gotten out in September. He’d been planning to go back to Wisconsin where his dad lived, play his guitar and become a cop.

Sandifer was questioning why they were sticking it out in the Korengal when the people so clearly hated them. He was haunted by Mendoza’s voice calling to him: “I’m bleeding out. I’m dying.” He worried that the Korengal was going to push them off the deep end. In his imagination it had already happened. One day an Afghan visited their fire base, Sandifer told me. “I was staring at him, on the verge of picking up my weapon to shoot him,” he said. “I know right from wrong, but even if I did shoot him everyone at the fire base would have been O.K. We’re all to the point of ‘Lord of the Flies.’ ” And they still had 10 months to go in the Korengal.

I wondered how Kearney was going to win back his own guys, let alone win over the Korengalis. Just before I left, Kearney told me his biggest struggle would be holding his guys in check. “I’ve got too many geeking out, wanting to go off the deep end and kill people,” he said. One of his lieutenants wanted to shoot every Afghan in the face. Kearney shook his head. He wished he could buy 20 goats and let the boys beat and burn them and let loose their rage. He tried to tell them the restraints were a product of their success — that there was an Afghan government with its own rules. “I’m balancing plates on my goddamn nose is what I’m doing,” he said. “All it’s gonna take is for one of these guys to snap.”

But leave the Korengal, as the colonel had suggested, and let some other company deal with it? No way. He’d spent five months learning the valley, getting involved in it; he couldn’t just pull out. At least he would keep the insurgents busy here so the other companies could do hearts and minds unimpeded down along the Pech river. “I lost seven dudes here,” he told me. “It’s too much blood. I don’t want to give this up. This is mine.”

Colonel Ostlund and his officers, and the governor of Kunar and his officials, held an all-day meeting with the Korengali elders. The elders wanted to talk about Rock Avalanche and the devastation that had rained down on them. Colonel Ostlund told them, “If anything should happen to Captain Kearney, pain and misery will knock on many doors in the Korengal.” He gave them 10 days to pick sides — the insurgents or the government. Only then would he consider going ahead with the road project. Their answer came back. They would leave the valley altogether. But they didn’t, and 10 days later insurgents pulled off another ambush of a platoon from the 173rd. The entire patrol went down, either wounded or killed. Kearney told me recently that they had wounded Abu Ikhlas and killed some other bad guys. He said he was pretty sure that Haji Matin, the embittered timber lord, had been killed, too. But the dialogue with the Korengalis was pretty much the same as it had been. Only the winter snows have brought some minor respite to the valley.

Joint Terminal Attack Controller Gabe Beck, center, speaks with a bomber pilot while a "troops in contact" incident unfolds in the Korengal Valley. Working with pilots, Beck calls in airstrikes while weighing the possibility of collateral damage.

Lt. Matt Piosa rests inside a bunker. The 173rd Airborne division Battle Company established the bunker after a difficult battle with insurgents to control the strategic high grounds near the Korengal Outpost.

Captain Dan Kearney, second from left, and Staff Sgt. Mike Nestell discuss recent fighting with village elders. Haji Zalwar Khan is at far right.

A soldier with the battle company, left, and an Afghan Army soldier walk with an elder as they conduct a patrol in the Korengal Valley.

A soldier plays a video game in the Korengal Outpost command center.

Soldiers with the battle company take shelter from a mortar barrage in a bunker at the Korengal Outpost.

Capt. Dan Kearney bows his head in frustration after the denial of his request for an air strike against men walking nearby with weapons. Above his head, the laser of an AC-130 plane tracks a potential target.

Cpt. Dan Kearney, kneeling, arrives to check on Staff Sgt. Rice, after Rice was shot in an insurgent ambush.

Sgt. Tanner Stichter tends to a wounded Specialist Carl Vandenberge.

Soldiers take shelter behind a tree trunk as they await the arrival of a medevac helicopter. The helicopter will airlift the body of Staff Sgt. Larry Rougle, who was killed in the insurgent ambush.

Specialist Carl Vandenberge, right, and Staff Sgt. Kevin Rice, left, are assisted as they walk to a medevac helicopter after being shot by insurgents in the ambush.

U.S. troops carry the body of Staff Sgt. Larry Rougle, who was killed when the insurgents ambushed their squad in the Korengal Valley.

A soldier sits alone in the dust of a medevac helicopter as it departs with the body of his comrade Staff Sgt. Rougle.

Governors Oppose New Medicaid Rules

The New York Times reports:

Governors of both parties strongly objected on Saturday to a half-dozen new federal Medicaid regulations that they said would shift billions of dollars in costs to the states, forcing them to consider cutbacks in services.

The rules, scheduled to take effect in the next few months, would reduce federal payments for public hospitals, teaching hospitals and services for the disabled, among others.

State officials voiced their concerns as they arrived here for the winter meeting of the National Governors Association.

Federal health officials said the new rules were needed to end creative financing techniques that states had used to obtain excessive amounts of federal Medicaid money.

But governors said the Bush administration was unilaterally reshaping Medicaid in ways that would harm some of their most vulnerable citizens. Moreover, they said, the rules are taking effect at a time when the national economic slowdown is cutting into state tax revenues.

“Governors strongly oppose the changes,” said Gov. Jim Douglas of Vermont, a Republican who is chairman of the association’s Health and Human Services Committee. “The timing could not be worse.”

One of the rules would ban the use of federal Medicaid money to help pay for the training of doctors, a use that has been allowed since the inception of Medicaid more than 40 years ago. Another would set new limits on Medicaid payments to hospitals and nursing homes operated by states, cities, counties and other units of government.

A third rule would limit Medicaid coverage of rehabilitation services for people with disabilities, including serious mental illnesses.

Federal officials estimate that the rules will save the federal government $15 billion over five years. But that figure may be low. California alone says it could lose $12 billion over five years.

Congress delayed some of the rules last year, but they will soon take effect unless Congress intervenes again.

Gov. Arnold Schwarzenegger of California, a Republican, said the rule changes “would effectively end the federal government’s participation in many crucial components of the Medicaid program.”

Dr. Rhonda M. Medows, commissioner of the Georgia Department of Community Health, said: “We understand the need for financial safeguards, but these rules, taken together, would have a tremendous adverse impact. They would undermine the health care safety net for the entire state of Georgia, reducing federal Medicaid payments for hospitals, nursing homes and school clinics.”

The National Conference of State Legislatures joined governors in criticizing what it described as “the regulatory activism” displayed in the new rules.

The federal government and the states share the cost of Medicaid, which provides health insurance to more than 60 million low-income people, including 30 million children.

Dennis G. Smith, director of the federal Center for Medicaid and State Operations, said the rules were needed to “protect the fiscal integrity of the Medicaid program.” Since 2003, he said, federal officials have persuaded 30 states to end “questionable Medicaid financing arrangements.” The purpose of such arrangements is to maximize the use of federal money while holding down the use of state and local revenue.

Although the most blatant problems have been corrected, the administration says, many states still use federal Medicaid money for purposes unrelated to Medicaid.

“We believe that paying for graduate medical education is outside the scope of Medicaid’s role, which is to provide medical care to low-income people,” Mr. Smith said. “There is no explicit authorization under the Medicaid statute to subsidize the training of physicians.”

Robert M. Dickler, chief health care officer at the Association of American Medical Colleges, said, “It’s a little surprising that the federal government would just now discover that there’s no legal basis for the Medicaid payments it’s been making for medical education since 1965.”

Stan Rosenstein, the Medicaid director in California, said the payments were justified because “interns and residents provide a tremendous amount of care to Medicaid beneficiaries.”

The federal government says this rule would save $1.8 billion over five years. But New York, which trains 15 percent of the nation’s doctors, says it would lose more than that alone. State officials are also concerned about a rule that would eliminate federal contributions for a whole category of public spending on health care for the poor — specifically, spending by autonomous units of local government like the Denver Health and Hospital Authority.

“As a result of this rule, we will lose $60 million a year,” said Dr. Patricia A. Gabow, chief executive of the Denver agency, which operates a 477-bed public hospital, the city’s public health department and its ambulance service. “We were part of the city government for more than 130 years. In 1997, we became an independent governmental entity, but we don’t have taxing authority. So we don’t qualify as a public provider, and we can’t draw down critically important subsidies for services we provide to the entire community.”

Larry S. Gage, president of the National Association of Public Hospitals, said the rule’s importance went far beyond Medicaid because it would compromise the ability of public hospitals to provide vital services like trauma care and burn treatment.

New York City Health and Hospitals Corporation, the largest municipal health care system in the country, which gets 60 percent of its budget from Medicaid, said the rules would have “a potentially devastating impact” and could force cutbacks in services.

A group of 17 states, including Connecticut, Michigan and New Jersey, told the administration that the new restrictions were “simply awful public policy.” Senators Jeff Bingaman, Democrat of New Mexico, and Elizabeth Dole, Republican of North Carolina, are fighting the rule on public hospitals.

The rule “would have a devastating effect on North Carolina’s Medicaid system, costing our hospitals hundreds of millions of dollars annually,” Mrs. Dole said.

The Medicaid rules were overshadowed last year by a battle over insurance for children.

“We can have a legitimate discussion about expanding the Children’s Health Insurance Program,” said Governor Douglas of Vermont. “But the Medicaid rules are different. They renege on commitments already made.”

In Vermont, Mr. Douglas said, “we’ve come to rely on Medicaid to help pay for special education and other services to children with disabilities.”

Medicaid is a crucial part of the foundation on which many states were planning to build coverage for the uninsured.

Deborah S. Bachrach, a deputy commissioner in the New York State Health Department, said, “The new Medicaid rules make it difficult to pay for current programs and nearly impossible to expand coverage to all.”