Sarah Palin's $159,050 Conflict of Interest

At Huffington Post, Chris Kelly writes:

While you read this, Alaska's First Dude, Todd Palin, is riding a snowmobile -- I'm sorry, snow machine -- 1971 miles from Big Lake to Fairbanks. In the course of performing this awesome feat, his Arctic Cat's powerful two-stroke engine will emit the same amount of hydrocarbons as an automobile driving from Chicago to San Francisco and back 150 times.

A small price for the rest of us to pay to honor the indomitability of the human spirit and one man's ability to sit and hold on.

It's not just a blaze of glory and aromatic hydrocarbon. A conventional two-stroke engine emits as much as a quarter of its fuel unburned, directly into the air. This week, as a participant in the Iron Dog™ snow machine race, Todd Palin will release as many cancer-causing and smog-forming pollutants as a Chevy Malibu driven around the Earth at its equator 28 times.

Seems like a lot of work, just to get away from Sarah Palin.

But Todd's not just doing it because he hates his home life and likes things that make loud noises and emit benzene. He does it because it's there. And for hundreds of thousands of dollars in cash and gifts from corporations who do business with the Governor's office.

For riding a snowmobile.

Something you could train a bear to do.

The Emperor Nero used to clean up at the Olympic games. It was eerie. He won everything. According to Suetonius, he once won a chariot race despite falling off and not finishing the course. That's how good he was. He also never wore the same clothes twice. So he would have fit right in with the Palins there also.

I'm not insinuating anything. I'm just saying.

The total purse value of this year's Iron Dog™ is $159,050. The sponsors include the petroleum giants Tesoro and Conoco-Phillips; State Farm, Wells Fargo, Frontier Airlines, Alaska Airlines and the Alaska First National Bank.

The Iron Dog™ has fewer than 40 entrants a year, and one of them is always Todd.

Does this smell? I'm probably the wrong person to ask. I hate the cold and I think motor sports is an oxymoron. But he is Alaska's First Lady, and Tesoro is an oil company.

Let's say this was Louisiana in the '30s. If Texaco sponsored a pancake-eating contest, and Huey Long's wife kept winning it, there would have been talk.

To be fair, Todd can't win the whole purse. There are lots of little door prizes just for rookies and women and steak dinners for Cutest Hat. Just like in Jack London days.

And, to be fair, Todd doesn't always walk away from the camping trip with the hundred grand first prize. He's only won four times.

Once after Sarah was elected to the Wasilla City Council, once after she was elected mayor, the year she was appointed to the Alaska Oil and Gas Commission, and the year she was elected governor.

Once-Secret Memos Question Hillary Clinton's Honesty

The Washington Times reports:

A decade before Sen. Hillary Rodham Clinton admitted fudging the truth during the presidential campaign, federal prosecutors quietly assembled hundreds of pages of evidence suggesting she concealed information and misled a federal grand jury about her work for a failing Arkansas savings and loan at the heart of the Whitewater probe, according to once-secret documents that detail the internal debates over whether she should have faced criminal charges.

Ordinarily, such files containing grand jury evidence and prosecutors' deliberations are never made public. But the estate of Sam Dash, a lifelong Democrat who served as the ethics adviser to Whitewater Independent Counsel Kenneth W. Starr, donated his documents from the infamous 1990s investigation to the Library of Congress after his 2004 death, unwittingly injecting into the public domain much of the testimony and evidence gathered against Mrs. Clinton from former law partners, White House aides and other witnesses.

The documents, reviewed by The Washington Times, identify numerous instances in which prosecutors questioned Mrs. Clinton's honesty, an issue that continues to dog her on the campaign trail after she was forced to acknowledge earlier this year exaggerating a story about coming under sniper fire as first lady during a visit to Bosnia in 1996.

For instance, the papers say prosecutors thought Mrs. Clinton first concealed her legal representation of Madison Guaranty Savings and Loan Association — and the money she made doing it — during the 1992 presidential campaign when she and her husband, then-Arkansas Gov. Bill Clinton, came under fire in a questionable Arkansas real estate project known as Whitewater.

Beginning in March 1992 and continuing over the next several years, Mrs. Clinton steadfastly denied that she ever "earned a penny" in representing her Rose Law Firm clients, including the failing thrift's owners, James and Susan McDougal — the Clintons' partners in the Whitewater Development Corp. project.

But the newly discovered records, more than 1,100 pages in 30 separate documents, tell a different story.

A June 1998 draft indictment of Mrs. Clinton's Rose firm partner Webster L. Hubbell, who followed the Clintons to Washington in 1993 as associate attorney general, said Mrs. Clinton did legal work for Madison "continuously" from April 1985 to July 1986. It also said she represented the thrift before the Arkansas Securities Department for approval to issue preferred stock, helped Madison obtain a questionable broker-dealer license to sell the stock and was actively involved in a failed Madison project known as Castle Grande.

The draft indictment clearly asserts that Mrs. Clinton, despite her denials, represented Madison and its projects "in a series of real estate and financial transactions." A separate 183-page report included in the Dash documents said Mr. Hubbell and Mrs. Clinton "concealed from federal investigators the true nature of their work" with Madison and its various entities.

Clinton campaign spokesman Jay Carson disputed the allegations.

"This is a baseless accusation which was looked into over a decade ago in an investigation that took $71.5 million and eight years to determine there was no case," he said.

But exit polls from Tuesday's North Carolina and Indiana primaries found that about half of the voters in each state said they didn't find Mrs. Clinton "honest and trustworthy."

Mrs. Clinton misspoke in March when she claimed she had come under sniper fire during a trip to Bosnia in 1996. She said she and her daughter, Chelsea, ran for cover under hostile fire shortly after her plane landed in Tuzla. She later admitted to making a "mistake."

The Library of Congress documents have not been released publicly. A library official said they are still being "processed."

In April 1998, Whitewater prosecutors, divided over Mrs. Clinton's truthfulness, argued over whether to indict her on charges of lying under oath about her legal work for Madison. Lawyers and others close to the probe said a draft indictment of the first lady became "a work in progress" after Mrs. Clinton's January 1996 grand jury appearance in U.S. District Court in Washington.

Prosecutors concluded at the time, the sources said, that she had testified falsely in denying doing legal work in the Castle Grande venture.

"There is concern among some about how successful they might be in bringing a criminal indictment against Mrs. Clinton for obvious reasons, but there is no lack of desire to do so," one lawyer familiar with the probe said at the time. The lawyer said the decision rested on two major points: whether there was sufficient evidence to contradict her sworn testimony and, more importantly, whether prosecutors could win the case in court.

No indictment was sought, but Whitewater prosecutors noted at the time, according to the Dash documents, that sworn statements by Mrs. Clinton were contradictory and misleading and that her involvement with Madison"s failed real estate project known as Castle Grande project was only fully detailed with the discovery of her Rose firm billing record summaries in the White House living quarters in January 1996 — two years after they had been subpoenaed.

A week before the summaries were found, the Resolution Trust Corp. (RTC) said in a Dec. 28, 1995, report it had little information on Mrs. Clinton's ties to Madison or Castle Grande. After their discovery, the agency concluded Mrs. Clinton was more involved with the two entities than was previously known.

The summaries said Mrs. Clinton billed Madison for 60 hours of legal work, spoke with Madison officials about the Castle Grande project on 14 occasions, discussed legal matters with Madison's owners — the McDougals — 16 times, had 28 meetings with Rose firm lawyers on Madison, and met with state regulators about Madison at least twice.

At the time, Madison was seeking help from Mrs. Clinton's Rose Law Firm in Little Rock to fend off state and federal regulators concerned that the thrift was insolvent. Madison also wanted to jump-start a questionable preferred stock deal to pump much-needed cash into the operation and was desperate to keep the government from shutting it down.

In December 1995, the Senate Whitewater Committee also made public handwritten notes of a telephone conversation that contradicted assertions made by Mrs. Clinton during the 1992 presidential race that she had little participation in the legal representation of Madison when state and federal regulators were deciding whether to shut it down.

The notes, by New York lawyer Susan Thomases, one of the first lady's closest advisers, said Mrs. Clinton had numerous conferences with officials at Madison, that she reviewed documents, that she made calls to discuss a preferred stock plan aimed at keeping the failing thrift afloat, and that "she did all the billing."

The committee released 350 pages of Madison files that said Mrs. Clinton, according to the billing summaries, had made significant claims on the thrift for legal services, and at one point was listed exclusively as the billing attorney. The summary is all that remains, since the original Rose firm billing records for Madison disappeared.

In May 1995, as the Whitewater investigation expanded into separate probes by Senate and House committees, the Federal Deposit Insurance Corp. (FDIC), the RTC and a federal grand jury, Mrs. Clinton denied in sworn affidavits any knowledge of a Madison real estate project known as Castle Grande, saying she had "no recollection" of doing legal work for the 1,050-acre development.

Madison was closed in 1989 at a cost to taxpayers of $70 million. Castle Grande failed at a taxpayers' loss of $4 million.

Another major area of concern, authorities said, was an option agreement regulators said "facilitated" a questionable $300,000 payment to Seth Ward, the Madison official to whom Mrs. Clinton had spoken about Castle Grande. The agreement was written by Mrs. Clinton and Mr. Hubbell and guaranteed Mr. Ward a payoff and negated his liability in the project. While the option was never exercised, it disguised the reason for the payment and created a paper trail to justify the outlay to Mr. Ward, who was Mr. Hubbell's father-in-law.

Mrs. Clinton told the RTC in May 1995 she had no memory of providing legal services for Mr. Ward and said in a sworn statement she did not know the Castle Grande name, thinking the project was called IDC even though the Castle Grande name was widely associated with the site.

Not truthful

According to the Dash documents on Whitewater, investigators also challenged Mrs. Clinton's public statements on what she knew at the time of Mr. Hubbell's March 1994 Justice Department resignation. Mrs. Clinton told reporters she thought he quit over an "internal billing dispute" with his former Rose firm partners that "likely would be resolved."

But the records said that three months before the resignation, Mrs. Clinton had been told by another Rose firm partner, Allen Bird, that Mr. Hubbell's "billing problems were very serious" and documents released during the Senate Whitewater hearings in 1996 said that two weeks before Mr. Hubbell resigned, Mrs. Clinton was notified formally that her former law partner was involved in a conflict-of-interest investigation and he might have lied in a sworn statement to federal regulators.

The Dash records also state that Mr. Hubbell's extensive role in a conflict in the Rose firm's representation of Madison and his testimony under oath to the RTC had meticulously been described in a March 1, 1994, memo written by White House Associate Counsel W. Neil Eggleston and forwarded to Mrs. Clinton by White House Deputy Chief of Staff Harold Ickes.

The records said Mr. Eggleston's seven-page memo described concerns by the RTC and the FDIC on whether the Rose firm had disclosed its prior legal representation of Madison in an FDIC lawsuit against the thrift's former auditors and whether Mr. Hubbell had disclosed his relationship with Mr. Ward in Castle Grande.

Mr. Eggleston's memo, according to the records, said the RTC had concluded the Rose firm disclosed neither the prior representation nor Mr. Hubbell's relationship, noting that an "ultimate finding" of nondisclosure would mean that "Mr. Hubbell was not truthful in his recollection." Mr. Eggleston said a finding against the firm would mean that it was "permanently barred from any further work for the RTC or the FDIC (and possibly other banking regulators.)"

He also said that while it was "not clear" whether the FDIC or the RTC would review the accusations under an actual conflict standard, there was the possibility of sanctions in the case, including "criminal liability," the records said.

The records also said Whitewater investigators were concerned that Mrs. Clinton played a key role in helping Mr. Hubbell obtain consulting contracts after his March 14, 1994, Justice Department resignation.

In a report titled "Hubbell Hush Money Summary," Whitewater investigators said that a day before Mr. Hubbell quit, Mrs. Clinton and other top administration officials met privately at the White House to arrange for him to receive hundreds of thousands of dollars in consulting fees at a time his cooperation in the Whitewater probe could have resulted in charges against the then-first lady.

The records said Mrs. Clinton took an active role in White House efforts to "take care of" Mr. Hubbell financially, helping to locate campaign supporters who divvied up more than $450,000 over the next nine months mostly for consulting work he never did.

In 1997, Mr. Starr subpoenaed White House records to determine whether the consulting fees were intended to guarantee Mr. Hubbell's silence in the Whitewater probe. Mr. Starr also wanted to know whether the White House had sought or directed the payments.

An Oct. 22, 1998, report said Mr. Hubbell's fees were arranged through "high administration officials or advisors," including Mrs. Clinton, whom was described as "the direct impetus for at least one client." Others who helped were identified as White House Chief of Staff Thomas F. "Mack" McLarty; former Democratic National Committee Chairman Truman Arnold; Washington lawyer Vernon Jordan; Small Business Administration Chairman Erskine Bowles, a former White House chief of staff; and U.S. Trade Representative Mickey Kantor, the Clinton-Gore campaign chairman in 1992 who later served as commerce secretary.

An April 21, 1998, report questioned why White House officials would choose to "support Hubbell and take care of him" at a time "[Mrs. Clinton] was on notice that Hubbell engaged in a widespread pattern and practice of cheating the [Rose Law Firm]." The report said a "sinister reason" could be Mr. Hubbell knew about Mrs. Clinton's role in doing legal work for Madison and other related companies.

A May 21, 1997, memo, noted that most of the company officials who paid him consulting fees said no work product was ever produced. The report said one employer told investigators the only document Mr. Hubbell produced was "his bill."

Mr. Hubbell pleaded guilty in December 1994 to mail fraud and income-tax evasion in the theft of $482,410 from his Rose firm clients and partners and failing to pay $143,747 in taxes. He was sentenced to 21 months in prison, serving 16 before being released.

The Whitewater probe ended on March 21, 2002, when Independent Counsel Robert W. Ray, who succeeded Mr. Starr, concluded in a final report there was "insufficient evidence" to bring charges against the Clintons. But the report also said statements by the Clintons to investigators were "factually inaccurate" and that White House delays in the production of evidence and the "unmeritorious litigation" by its lawyers "severely impeded the investigation's progress."

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.

Neil Bush's Firm Under Federal Scrutiny

The AP reports:

The Education Department's inspector general says he will review whether federal money is inappropriately being spent on programs by a company founded by Neil Bush, the president's brother.

Citizens for Responsibility and Ethics in Washington, a Washington-based watchdog group, called for the inquiry and released a letter this week from the department's inspector general, John Higgins Jr.

In it, Higgins said he would ask an assistant to examine the group's complaint.

The group contends school districts inappropriately are using federal dollars for Ignite! Learning Inc. programs. It says there is no proof the company's products are effective and claims the schools are using the products due to political considerations.

The company's president, Ken Leonard, said in a statement that Ignite! has not received any correspondence from the inspector general's office.

"Ignite! Learning has no knowledge of any customer that has procured our curriculum solutions through means which are other than completely ethical and in compliance with the typical guidelines of their various funding sources," Leonard said.

Ignite! sells a product it refers to as a Curriculum on Wheels, which comes with software to teach math, social studies and science and costs about $3,800 each, not including subscription costs.

Neil Bush is the chairman of the company, based in Austin, Texas.

More Questions Over White House E-Mail

The Associated Press reports:

An ethics advocacy group asked a federal judge Thursday to order the White House to preserve tapes used to back up its e-mail system.

Asserting that the White House may not have kept copies of e-mails that are at the heart of a dispute over the Bush administration's record-keeping, Citizens for Responsibility and Ethics in Washington filed a motion asking for a court order to preserve computer backup tapes.

"The White House is refusing to confirm that they have maintained e-mail going back to the beginning of the administration as they are required by law to do," said Melanie Sloan, executive director of Citizens for Responsibility and Ethics.

The group placed on the public record two Justice Department letters stating that the White House is maintaining all backup tapes that were in the possession of the White House Office of Administration as of Sept. 25, 2007, the date CREW sued the Executive Office of the President in the e-mail controversy.

The private group asked the Justice Department for information about what backup tapes were in the White House's possession, but the Justice Department has not provided an explanation.

The possibility that backup tapes may not contain copies of all White House e-mail is a new dimension to the controversy, which first arose in early 2006. CREW alleges that millions of White House e-mails are missing, and that the backup tapes contained the lone remaining copies.

"At present the missing e-mail records exist only on backup tapes and other mediums, if at all," CREW said in its court filing. "Thus, those backup tapes contain the only copies of important historical evidence of this presidency."

CREW is entitled to a temporary restraining order to prevent any further document destruction, the group said in its filing with U.S. District Judge Henry Kennedy, an appointee of President Clinton.

In the past, the White House has said it is aware that some e-mails may not have been automatically archived on a computer server for the Executive Office of the President and that the e-mails may have been preserved on backup tapes.

In response to the latest court filing, White House spokesman Scott Stanzel said that because the matter is in court, he is referring to previous White Houses comments on the issue.

The White House has said that its Office of Administration is looking into whether there are e-mails that were not automatically archived and that if there is a problem, the necessary steps will be taken to address it.

The first indication of a problem came in nearly two years ago when special counsel Patrick Fitzgerald raised the possibility that records sought in the CIA leak investigation involving the outing of Valerie Plame could be missing because of an e-mail archiving problem at the White House.

The issue arose again this year amid the controversy over the firing of U.S. attorneys. Aides to Bush improperly used Republican Party-sponsored e-mail accounts for official business and an undetermined number of e-mails were lost.

Phone-Jamming Scandal May Finally Be Solved

At the Huffington Post, Thomas B. Edsall writes:

One of the long-standing mysteries of the Bush presidency is whether the White House and Justice Department were involved in a 2002 New Hampshire voter suppression scandal that produced three criminal convictions but never touched the administration.

Now, with Democrats back in control of Congress, this mystery may finally get cleared up. John Conyers Jr. (D-Mich.), chairman of the House Judiciary Committee, and subcommittee chairs, plan to investigate the controversial role of the Justice Department in the case.

There are two key issues questions involving Justice:

First, whether top officials there blocked a New Hampshire prosecutor from pursuing leads involving the White House and both the Republican National and Senatorial Committees.

Second, whether the Department purposely delayed prosecution of the one defendant with ties to the RNC and NRSC until after the 2004 election. The Department did attempt on October 15, 2004, just over two weeks before the election, to block depositions of key witnesses in a civil suit brought by the New Hampshire Democratic Party.

The vote suppression/phone jamming operation was dreamed up in 2002 by Charles McGee, executive director of the New Hampshire Republican Party, who obtained phone numbers of Democratic support groups offering Election Day rides to the polls, according to McGee's court testimony.

McGee then hired an Idaho telemarketing company to flood those numbers with phony calls, blocking all legitimate requests for help getting rides to the polls.

Initially, McGee's plan worked perfectly. For two hours, the Idaho firm tied up Democratic Party and pro-Democratic union phone lines, preventing seniors and others needing a lift to their voting places from being able to request rides.

"The phones were starting to ring, and as I would pick up one phone, it automatically bumped over to another line," testified Manchester firefighter Jeffery S. Duval, who was working the phones at his union's headquarters. "There was nobody on any of the phones. The phone lines were dead once we went to pick them up... We gave the police department a call."

Realizing there could be criminal implications, Republican leaders quickly ordered the telemarketing company to stop the jamming, according to court testimony. The FBI and the Justice Department were then called in because the allegations involved violations of federal telecommunications law.

The effort helped John E. Sununu (R) beat Jeanne Shaheen (D) in a tight Senate race by 51 to 47 percent, a 19,151-vote margin.

In addition to the questions about the role of the Justice Department, there were strong indications of involvement on the part of the White House and other D.C.-based pro-Republican groups:

* Over the course of 4 hours on Election Day, just as New Hampshire police began investigating the scheme to jam the phones, James Tobin, Northeast Regional Director for the Republican National and Senatorial Committees, made 22 phone calls to the White House political office, according to court records.

* Later, when Tobin was tried, the Republican National Committee paid $2.8 million to cover his legal fees. Tobin was found guilty, but an appeals court threw out the verdict on the grounds that the judge's orders to the jury were inadequate, and ordered a new trial. No date has been set.

* Another defendant in the case testified that when the phone-jamming operation was brought to a halt, an American Gas Association lobbyist, Darrell Henry, said he would get the Chamber of Commerce to take over the effort to disrupt the Democratic get out the vote undertaking. When Henry was deposed, he refused to answer questions, asserting his Fifth Amendment right not to incriminate himself.

Danny Diaz, a RNC spokesman, contends a congressional inquiry into the New Hampshire case is unjustified: "The questions regarding the New Hampshire issue have been answered time and again. Additional activity on this front is solely for political purposes and is a questionable usage of taxpayer dollars."

In a letter to Acting Attorney General Peter D. Keisler, Conyers and the subcommittee chairs, Robert C. Scott (D-VA), Jerrold Nadler (D-NY), and Linda Sánchez (D-CA), detailed the Tobin-White House calls, the payment by the RNC of Tobin's legal fees, and then stated:

"Despite this compelling evidence of Washington involvement in the election day jamming of Democratic phone lines, however, the FBI Special Agent working this matter allegedly was instructed not to follow investigative leads back to Washington.

"In addition, the attorney for one of the phone jamming defendants has stated that he was told by a federal prosecutor that 'all decisions in this case had to be made subject to the approval of the Attorney General himself, who had to sign off on all actions in this case,' an unusual state of affairs for a criminal prosecution."

The prime mover behind the congressional inquiry is freshman Representative Paul Hodes (D-NH) who has been pressing both the House and Senate to take action.

The Great Iraq Swindle

How Bush Allowed an Army of For-Profit Contractors to Invade the U.S. Treasury

Rolling Stone reports:

How is it done? How do you screw the taxpayer for millions, get away with it and then ride off into the sunset with one middle finger extended, the other wrapped around a chilled martini? Ask Earnest O. Robbins -- he knows all about being a successful contractor in Iraq.

You start off as a well-connected bureaucrat: in this case, as an Air Force civil engineer, a post from which Robbins was responsible for overseeing 70,000 servicemen and contractors, with an annual budget of $8 billion. You serve with distinction for thirty-four years, becoming such a military all-star that the Air Force frequently sends you to the Hill to testify before Congress -- until one day in the summer of 2003, when you retire to take a job as an executive for Parsons, a private construction company looking to do work in Iraq.

Now you can finally move out of your dull government housing on Bolling Air Force Base and get your wife that dream home you've been promising her all these years. The place on Park Street in Dunn Loring, Virginia, looks pretty good -- four bedrooms, fireplace, garage, 2,900 square feet, a nice starter home in a high-end neighborhood full of spooks, think-tankers and ex-apparatchiks moved on to the nest-egg phase of their faceless careers. On October 20th, 2003, you close the deal for $775,000 and start living that private-sector good life.

A few months later, in March 2004, your company magically wins a contract from the Coalition Provisional Authority in Iraq to design and build the Baghdad Police College, a facility that's supposed to house and train at least 4,000 police recruits. But two years and $72 million later, you deliver not a functioning police academy but one of the great engineering clusterfucks of all time, a practically useless pile of rubble so badly constructed that its walls and ceilings are literally caked in shit and piss, a result of subpar plumbing in the upper floors.

You've done such a terrible job, in fact, that when auditors from the Special Inspector General for Iraq Reconstruction visit the college in the summer of 2006, their report sounds like something out of one of the Saw movies: "We witnessed a light fixture so full of diluted urine and feces that it would not operate," they write, adding that "the urine was so pervasive that it had permanently stained the ceiling tiles" and that "during our visit, a substance dripped from the ceiling onto an assessment team member's shirt." The final report helpfully includes a photo of a sloppy brown splotch on the outstretched arm of the unlucky auditor.

When Congress gets wind of the fiasco, a few members on the House Oversight Committee demand a hearing. To placate them, your company decides to send you to the Hill -- after all, you're a former Air Force major general who used to oversee this kind of contracting operation for the government. So you take your twenty-minute ride in from the suburbs, sit down before the learned gentlemen of the committee and promptly get asked by an irritatingly eager Maryland congressman named Chris Van Hollen how you managed to spend $72 million on a pile of shit.

You blink. Fuck if you know. "I have some conjecture, but that's all it would be" is your deadpan answer.

The room twitters in amazement. It's hard not to applaud the balls of a man who walks into Congress short $72 million in taxpayer money and offers to guess where it all might have gone.

Next thing you know, the congressman is asking you about your company's compensation. Touchy subject -- you've got a "cost-plus" contract, which means you're guaranteed a base-line profit of three percent of your total costs on the deal. The more you spend, the more you make -- and you certainly spent a hell of a lot. But before this milk-faced congressman can even think about suggesting that you give these millions back, you've got to cut him off. "So you won't voluntarily look at this," Van Hollen is mumbling, "and say, given what has happened in this project . . . "

"No, sir, I will not," you snap.

". . . 'We will return the profits.' . . ."

"No, sir, I will not," you repeat.

Your testimony over, you wait out the rest of the hearing, go home, take a bath in one of your four bathrooms, jump into bed with the little woman. . . . A year later, Iraq is still in flames, and your president's administration is safely focused on reclaiming $485 million in aid money from a bunch of toothless black survivors of Hurricane Katrina. But the house you bought for $775K is now assessed at $929,974, and you're sure as hell not giving it back to anyone.

"Yeah, I don't know what I expected him to say," Van Hollen says now about the way Robbins responded to being asked to give the money back. "It just shows the contempt they have for us, for the taxpayer, for everything."

Operation Iraqi Freedom, it turns out, was never a war against Saddam Hussein's Iraq. It was an invasion of the federal budget, and no occupying force in history has ever been this efficient. George W. Bush's war in the Mesopotamian desert was an experiment of sorts, a crude first take at his vision of a fully privatized American government. In Iraq the lines between essential government services and for-profit enterprises have been blurred to the point of absurdity -- to the point where wounded soldiers have to pay retail prices for fresh underwear, where modern-day chattel are imported from the Third World at slave wages to peel the potatoes we once assigned to grunts in KP, where private companies are guaranteed huge profits no matter how badly they fuck things up.

And just maybe, reviewing this appalling history of invoicing orgies and million-dollar boondoggles, it's not so far-fetched to think that this is the way someone up there would like things run all over -- not just in Iraq but in Iowa, too, with the state police working for Corrections Corporation of America, and DHL with the contract to deliver every Christmas card. And why not? What the Bush administration has created in Iraq is a sort of paradise of perverted capitalism, where revenues are forcibly extracted from the customer by the state, and obscene profits are handed out not by the market but by an unaccountable government bureaucracy. This is the triumphant culmination of two centuries of flawed white-people thinking, a preposterous mix of authoritarian socialism and laissez-faire profiteering, with all the worst aspects of both ideologies rolled up into one pointless, supremely idiotic military adventure -- American men and women dying by the thousands, so that Karl Marx and Adam Smith can blow each other in a Middle Eastern glory hole.

It was an awful idea, perhaps the worst America has ever tried on foreign soil. But if you were in on it, it was great work while it lasted.

Since time immemorial, the distribution of government largesse had followed a staid, paper-laden procedure in which the federal government would post the details of a contract in periodicals like Commerce Business Daily or, more recently, on the FedBizOpps Website. Competitive bids were solicited and contracts were awarded in accordance with the labyrinthine print of the U.S. Code, a straightforward system that worked well enough before the Bush years that, as one lawyer puts it, you could "count the number of cases of criminal fraud on the fingers of one hand."
There were exceptions to the rule, of course -- emergencies that required immediate awards, contracts where there was only one available source of materials or labor, classified deals that involved national security. What no one knew at the beginning of the war was that the Bush administration had essentially decided to treat the entire Iraqi theater as an exception to the rules. All you had to do was get to Iraq and the game was on.

But getting there wasn't easy. To travel to Iraq, would-be contractors needed permission from the Bush administration, which was far from blind in its appraisal of applicants. In a much-ballyhooed example of favoritism, the White House originally installed a clown named Jim O'Beirne at the relevant evaluation desk in the Department of Defense. O'Beirne proved to be a classic Bush villain, a moron's moron who judged applicants not on their Arabic skills or their relevant expertise but on their Republican bona fides; he sent a twenty-four-year-old who had never worked in finance to manage the reopening of the Iraqi stock exchange, and appointed a recent graduate of an evangelical university for home-schooled kids who had no accounting experience to manage Iraq's $13 billion budget. James K. Haveman, who had served as Michigan's community-health director under a GOP governor, was put in charge of rehabilitating Iraq's health-care system and decided that what this war-ravaged, malnourished, sanitation-deficient country most urgently needed was . . . an anti-smoking campaign.

Town-selectmen types like Haveman weren't the only people who got passes to enter Iraq in the first few years. The administration also greenlighted brash, modern-day forty-niners like Scott Custer and Mike Battles, a pair of ex-Army officers and bottom-rank Republican pols (Battles had run for Congress in Rhode Island and had been a Fox News commentator) who had decided to form a security company called Custer Battles and make it big in Iraq. "Battles knew some people from his congressional run, and that's how they got there," says Alan Grayson, an attorney who led a whistle-blower lawsuit against the pair for defrauding the government.

Before coming to Iraq, Custer Battles hadn't done even a million dollars in business. The company's own Website brags that Battles had to borrow cab fare from Jordan to Iraq and arrived in Baghdad with less than $500 in his pocket. But he had good timing, arriving just as a security contract for Baghdad International Airport was being "put up" for bid. The company site raves that Custer spent "three sleepless nights" penning an offer that impressed the CPA enough to hand the partners $2 million in cash, which Battles promptly stuffed into a duffel bag and drove to deposit in a Lebanese bank.

Custer Battles had lucked into a sort of Willy Wonka's paradise for contractors, where a small pool of Republican-friendly businessmen would basically hang around the Green Zone waiting for a contracting agency to come up with a work order. In the early days of the war, the idea of "competition" was a farce, with deals handed out so quickly that there was no possibility of making rational or fairly priced estimates. According to those familiar with the process, contracting agencies would request phony "bids" from several contractors, even though the winner had been picked in advance. "The losers would play ball because they knew that eventually it would be their turn to be the winner," says Grayson.

To make such deals legal, someone in the military would simply sign a piece of paper invoking an exception. "I know one guy whose business was buying weapons on the black market for contractors," says Pratap Chatterjee, a writer who has spent months in the Mideast researching a forthcoming book on Iraq contracts. "It's illegal -- but he got military people to sign papers allowing him to do it."

The system not only had the advantage of eliminating red tape in a war zone, it also encouraged the "entrepreneurship" of patriots like Custer and Battles, who went from bumming cab fare to doing $100 million in government contracts practically overnight. And what business they did! The bid that Custer claimed to have spent "three sleepless nights" putting together was later described by Col. Richard Ballard, then the inspector general of the Army, as looking "like something that you and I would write over a bottle of vodka, complete with all the spelling and syntax errors and annexes to be filled in later." The two simply "presented it the next day and then got awarded about a $15 million contract."

The deal charged Custer Battles with the responsibility to perform airport security for civilian flights. But there were never any civilian flights into Baghdad's airport during the life of their contract, so the CPA gave them a job managing an airport checkpoint, which they failed miserably. They were also given scads of money to buy expensive X-ray equipment and set up an advanced canine bomb-sniffing system, but they never bought the equipment. As for the dog, Ballard reported, "I eventually saw one dog. The dog did not appear to be a certified, trained dog." When the dog was brought to the checkpoint, he added, it would lie down and "refuse to sniff the vehicles" -- as outstanding a metaphor for U.S. contractor performance in Iraq as has yet been produced.

Like most contractors, Custer Battles was on a cost-plus arrangement, which means its profits were guaranteed to rise with its spending. But according to testimony by officials and former employees, the partners also charged the government millions by making out phony invoices to shell companies they controlled. In another stroke of genius, they found a bunch of abandoned Iraqi Airways forklifts on airport property, repainted them to disguise the company markings and billed them to U.S. taxpayers as new equipment. Every time they scratched their asses, they earned; there was so much money around for contractors, officials literally used $100,000 wads of cash as toys. "Yes -- $100 bills in plastic wrap," Frank Willis, a former CPA official, acknowledged in Senate testimony about Custer Battles. "We played football with the plastic-wrapped bricks for a little while."

The Custer Battles show only ended when the pair left a spreadsheet behind after a meeting with CPA officials -- a spreadsheet that scrupulously detailed the pair's phony invoicing. "It was the worst case of fraud I've ever seen, hands down," says Grayson. "But it's also got to be the first instance in history of a defendant leaving behind a spreadsheet full of evidence of the crime."

But even being the clumsiest war profiteers of all time was not enough to bring swift justice upon the heads of Mr. Custer and Mr. Battles -- and this is where the story of America's reconstruction effort gets really interesting. The Bush administration not only refused to prosecute the pair -- it actually tried to stop a lawsuit filed against the contractors by whistle-blowers hoping to recover the stolen money. The administration argued that Custer Battles could not be found guilty of defrauding the U.S. government because the CPA was not part of the U.S. government. When the lawsuit went forward despite the administration's objections, Custer and Battles mounted a defense that recalled Nuremberg and Lt. Calley, arguing that they could not be guilty of theft since it was done with the government's approval.

The jury disagreed, finding Custer Battles guilty of ripping off taxpayers. But the verdict was set aside by T.S. Ellis III, a federal judge who cited the administration's "the CPA is not us" argument. The very fact that private contractors, aided by the government itself, could evade conviction for what even Ellis, a Reagan-appointed judge, called "significant" evidence of fraud, says everything you need to know about the true nature of the war we are fighting in Iraq. Is it really possible to bilk American taxpayers for repainted forklifts stolen from Iraqi Airways and claim that you were just following orders? It is, when your commander in chief is George W. Bush.

There isn't a brazen, two-bit, purse-snatching money caper you can think of that didn't happen at least 10,000 times with your tax dollars in Iraq. At the very outset of the occupation, when L. Paul Bremer was installed as head of the CPA, one of his first brilliant ideas for managing the country was to have $12 billion in cash flown into Baghdad on huge wooden pallets and stored in palaces and government buildings. To pay contractors, he'd have agents go to the various stashes -- a pile of $200 million in one of Saddam's former palaces was watched by a single soldier, who left the key to the vault in a backpack on his desk when he went out to lunch -- withdraw the money, then crisscross the country to pay the bills. When desperate auditors later tried to trace the paths of the money, one agent could account for only $6,306,836 of some $23 million he'd withdrawn. Bremer's office "acknowledged not having any supporting documentation" for $25 million given to a different agent. A ministry that claimed to have paid 8,206 guards was able to document payouts to only 602. An agent who was told by auditors that he still owed $1,878,870 magically produced exactly that amount, which, as the auditors dryly noted, "suggests that the agent had a reserve of cash."

In short, some $8.8 billion of the $12 billion proved impossible to find. "Who in their right mind would send 360 tons of cash into a war zone?" asked Rep. Henry Waxman, chairman of the House Oversight Committee. "But that's exactly what our government did."

Because contractors were paid on cost-plus arrangements, they had a powerful incentive to spend to the hilt. The undisputed master of milking the system is KBR, the former Halliburton subsidiary so ubiquitous in Iraq that soldiers even encounter its customer-survey sheets in outhouses. The company has been exposed by whistle-blowers in numerous Senate hearings for everything from double-charging taxpayers for $617,000 worth of sodas to overcharging the government 600 percent for fuel shipments. When things went wrong, KBR simply scrapped expensive gear: The company dumped 50,000 pounds of nails in the desert because they were too short, and left the Army no choice but to set fire to a supply truck that had a flat tire. "They did not have the proper wrench to change the tire," an Iraq vet named Richard Murphy told investigators, "so the decision was made to torch the truck."

In perhaps the ultimate example of military capitalism, KBR reportedly ran convoys of empty trucks back and forth across the insurgent-laden desert, pointlessly risking the lives of soldiers and drivers so the company could charge the taxpayer for its phantom deliveries. Truckers for KBR, knowing full well that the trips were bullshit, derisively referred to their cargo as "sailboat fuel."

In Fallujah, where the company was paid based on how many soldiers used the base rec center, KBR supervisors ordered employees to juke the head count by taking an hourly tally of every soldier in the facility. "They were counting the same soldier five, six, seven times," says Linda Warren, a former postal worker who was employed by KBR in Fallujah. "I was even directed to count every empty bottle of water left behind in the facility as though they were troops who had been there."

Yet for all the money KBR charged taxpayers for the rec center, it didn't provide much in the way of services to the soldiers engaged in the heaviest fighting of the war. When Warren ordered a karaoke machine, the company gave her a cardboard box stuffed with jumbled-up electronic components. "We had to borrow laptops from the troops to set up a music night," says Warren, who had a son serving in Fallujah at the time. "These boys needed R&R more than anything, but the company wouldn't spend a dime." (KBR refused requests for an interview, but has denied that it inflated troop counts or committed other wrongdoing in Iraq.)

One of the most dependable methods for burning taxpayer funds was simply to do nothing. After securing a contract in Iraq, companies would mobilize their teams, rush them into the war zone and then wait, citing the security situation or delayed paperwork -- all the while charging the government for housing, meals and other expenses. Last year, a government audit of twelve major contracts awarded to KBR, Parsons and other companies found that idle time often accounted for more than half of a contract's total costs. In one deal awarded to KBR, the company's "indirect" administrative costs were $52.7 million, and its direct costs -- the costs associated with the actual job -- were only $13.4 million.

Companies jacked up the costs even higher by hiring out layers of subcontractors to do their work for them. In some cases, each subcontractor had its own cost-plus arrangement. "We called those 'cascading contracts,' " says Rep. Van Hollen. "Each subcontractor piles on a lot of costs, and eventually they would snowball into a huge payout. It was a green light for waste."

In March 2004, Parsons -- the firm represented by Earnest O. Robbins -- was given nearly $1 million to build a fire station in Ainkawa, a small Christian community in one of the safest parts of Iraq. Parsons subcontracted the design to a British company called TPS Consult and the construction to a California firm called Innovative Technical Solutions Inc. ITSI, in turn, hired an Iraqi outfit called Zozik to do the actual labor.

A year and a half later, government auditors visited the site and found that the fire station was less than half finished. What little had been built was marred by serious design flaws, including concrete columns so shoddily constructed that they were riddled with holes that looked like "honeycombing." But getting the fuck-ups fixed proved problematic. The auditors "made a request that was sent to the Army Corps, which delivered it to Parsons, who then asked ITSI, which asked TPS Consult to check on the work done by Zozik," writes Chatterjee, who describes the mess in his forthcoming book, Baghdad Bonanza. The multiple layers of subcontractors made it almost impossible to resolve the issue -- and every day the delays dragged on meant more money for the companies.

Sometimes the government simply handed out money to companies it made up out of thin air. In 2006, the Army Corps of Engineers found itself unable to award contracts by the September deadline imposed by Congress, meaning it would have to "de-obligate" the money and return it to the government. Rather than suffer that awful fate, the corps obligated $362 million -- spread out over ninety-six different contracts -- to "Dummy Vendor." In their report on the mess, auditors noted that money to nobody "does not constitute proper obligations."

But even obligating money to no one was better than what sometimes happened in Iraq: handing out U.S. funds to the enemy. Since the beginning of the war, rumors have abounded about contractors paying protection money to insurgents to avoid attacks. No less an authority than Ahmed Chalabi, the head of the Iraqi National Congress, claimed that such payoffs are a "significant source" of income for Al Qaeda. Moreover, when things go missing in Iraq -- like bricks of $100 bills, or weapons, or trucks -- it is a fair assumption that some of the wayward booty ends up in the wrong hands. In July, a federal audit found that 190,000 weapons are missing in Iraq -- nearly one out of every three arms supplied by the United States. "These weapons almost certainly ended up on the black market, where they are repurchased by insurgents," says Chatterjee.

For all the creative ways that contractors came up with to waste, mismanage and steal public money in Iraq, the standard remained good old-fashioned fucking up. Take the case of the Basra Children's Hospital, a much-ballyhooed "do-gooder" project championed by Laura Bush and Condi Rice. This was exactly the sort of grandstanding, self-serving, indulgent and ultimately useless project that tended to get the go-ahead under reconstruction. Like the expensive telephone-based disease-notification database approved for use in hospitals without telephones, or the natural-gas-powered electricity turbines green lighted for installation in a country without ready sources of natural gas, the Basra Children's Hospital was a state-of-the-art medical facility set to be built in a town without safe drinking water. "Why build a hospital for kids, when the kids have no clean water?" said Rep. Jim Kolbe, a Republican from Arizona.

Bechtel was given $50 million to build the hospital -- but a year later, with the price tag soaring to $169 million, the company was pulled off the project without a single bed being ready for use. The government was unfazed: Bechtel, explained USAID spokesman David Snider, was "under a 'term contract,' which means their job is over when their money ends."

Their job is over when their money ends. When I call Snider to clarify this amazing statement, he declines to discuss the matter further. But if you look over the history of the Iraqi reconstruction effort, you will find versions of this excuse everywhere. When Custer Battles was caught delivering broken trucks to the Army, a military official says the company told him, "We were only told we had to deliver the trucks. The contract doesn't say they had to work."

Such excuses speak to a monstrous vacuum of patriotism; it would be hard to imagine contractors being so blithely disinterested in results during World War II, where every wasted dollar might mean another American boy dead from gangrene in the Ardennes. But the rampant waste of money and resources also suggests a widespread contempt for the ostensible "purpose" of our presence in Iraq. Asked to cast a vote for the war effort, contractors responded by swiping everything they could get their hands on -- and the administration's acquiescence in their thievery suggests that it, too, saw making a buck as the true mission of the war. Two witnesses scheduled to testify before Congress against Custer Battles ultimately declined not only because they had received death threats but because they, too, were contractors and feared that they would be shut out of future government deals. To repeat: Witnesses were afraid to testify in an effort to ­recover government funds because they feared reprisal from the government.

The Bush administration's lack of interest in recovering stolen funds is one of the great scandals of the war. The White House has failed to litigate a single case against a contractor under the False Claims Act and has not sued anybody for breach of contract. It even declined to join in a lawsuit filed by whistle-blowers who are accusing KBR of improper invoicing in Fallujah. "For all the Bush administration claims to do in the war against terrorism," Grayson said in congressional testimony, "it is a no-show in the war against war profiteers." In nearly five years of some of the worst graft and looting in American history, the administration has recovered less than $6 million.

What's more, when anyone in the government tried to question what contractors were up to with taxpayer money, they were immediately blackballed and treated like an enemy. Take the case of Bunnatine "Bunny" Greenhouse, an outspoken and energetic woman of sixty-three who served as the chief procurement executive for the Army Corps of Engineers. In her position, Greenhouse was responsible for signing off on sole-source contracts -- those awarded without competitive bids and thus most prone to corruption. Long before Iraq, she had begun to notice favoritism in the awarding of contracts to KBR, which was careful to recruit executives who had served in the military. "That was why I joined the corps: to stop this kind of clubby contracting," she says.

A few weeks before the Iraq War started, Greenhouse was asked to sign off on the contract to restore Iraqi oil. The deal, she noticed, was suspicious on a number of fronts. For one thing, the company that had designed the project, KBR, was the same company that was being awarded the contract -- a highly unusual and improper situation. For another, the corps wanted to award a massive "emergency" contract to KBR with no competition for up to five years, which Greenhouse thought was crazy. Who ever heard of a five-year emergency? After auditing the deal, the Pentagon found that KBR had overcharged the government $61 million for fuel. "The abuse related to contracts awarded to KBR," Greenhouse testified before the Senate, "represents the most blatant and improper contract abuse I have witnessed during the course of my professional career."

And how did her superiors in the Pentagon respond to the wrongdoing highlighted by their own chief procurement officer? First they gave KBR a waiver for the overbilling, blaming the problem on an Iraqi subcontractor. Then they dealt with Greenhouse by demoting her and cutting her salary, citing a negative performance review. The retaliation sent a clear message to any would-be whistle-blowers. "It puts a chill on you," Greenhouse says. "People are scared stiff."

They were scared stiff in Iraq, too, and for good reason. When civilian employees complained about looting or other improprieties, contractors sometimes threatened to throw them outside the gates of their bases -- a life-threatening situation for any American. Robert Isakson, a former FBI agent who worked for Custer Battles, says that when he refused to go along with one scam involving a dummy company in Lebanon, he was detained by company security guards, who seized his ID badge and barred him from the base in Baghdad. He eventually had to make a hazardous, Papillon-esque journey across hostile Iraq to Jordan just to survive. (Custer Battles denies the charge.)

James Garrison, who worked at a KBR ice plant in Al Asad, recalls an incident when Indian employees threatened to go on strike: "They pulled a bus up, got them in there and said, 'We'll ship you outside the front gate if you want to go on strike.' " Not surprisingly, the workers changed their mind about a work stoppage.

You know the old adage: You don't pay a hooker to spend the night, you pay her to leave in the morning. That maxim also applies to civilian workers in Iraq. A soldier is a citizen with rights, a man to be treated with honor and respect as a protector of us all; if one loses a limb, you've got to take care of him, in theory for his whole life. But a mercenary is just another piece of equipment you can bill to the taxpayer: If one is hurt on the job, you can just throw it away and buy another one. Today there are more civilians working for private contractors in Iraq than there are troops on the ground. The totality of the thievery in Iraq is such that even the honor of patriotic service has been stolen -- we've replaced soldiers and heroes with disposable commodities, men we expected to give us a big bang for a buck and to never call us again.

Russell Skoug, who worked as a refrigeration technician for a contractor called Wolfpack, found that out the hard way. These days Skoug is back home in Diboll, Texas, and he doesn't move around much; he considers it a big accomplishment if he can make it to his mailbox and back once a day. "I'm doing a lot if I can do that much," he says, laughing a little.

A year ago, on September 11th, Skoug was working for Wolfpack at a base in Heet, Iraq. It was a convoy day -- trucks braved the trip in and out of the base every third day -- and Skoug had a generator he needed to fix. So he agreed to make a run to Al Asad. "If I would've realized that it was September 11th, I never would've went out," he says. It would turn out to be the last run he would ever make in Iraq.

An Air Force vet, Skoug had come to Iraq as a civilian to repair refrigeration units and air conditioners for a KBR subcontractor called LSI. But when he arrived, he discovered that LSI had hired him to fix Humvees. "I didn't know jack-squat about Humvees," he says. "I could maybe change the oil, that was it." (Asked about Skoug's additional assignment, KBR boasted: "Part of the reason for our success is our ability to employ individuals with multiple capabilities.")

Working with him on his crew were two other refrigeration technicians, neither of whom knew anything about fixing Humvees. Since Skoug and most of his co-workers had worked for KBR in Afghanistan, they were familiar with cost-plus contracting. The buzz around the base was that cost-plus was the reason LSI was hiring air-conditioning guys to work on unfamiliar military equipment at a cost to the taxpayer of $80,000 a year. "They was doing the same thing as KBR: just filling the body count," says Skoug.

Thanks to low troop levels, all the military repair guys had been pressed into service to fight the war, so Skoug was forced to sit in the military storeroom on the base and study vehicle manuals that, as a civilian, he wasn't allowed to check out of the building. That was how America fought terrorism in Iraq: It hired civilian air-conditioning techs to fix Humvees using the instruction manual while the real Humvee repairmen, earning a third of what the helpless civilians were paid, drove around in circles outside the wire waiting to get blown up by insurgents.

After much pleading and cajoling, Skoug managed to convince LSI to let him repair some refrigeration units. But it turned out that the company didn't have any tools for the job. "They gave me a screwdriver and a Leatherman, and that's it," he recalls. "We didn't even have freon gauges." When Skoug managed to scrounge and cannibalize parts to get the job done, he impressed the executives at Wolfpack enough to hire him away from LSI for $10,000 a month. The job required Skoug, who had been given no formal security training, to travel regularly on dangerous convoys between bases. Wolfpack issued him an armored vehicle, a Yugoslav-made AK-47 and a handgun, and wished him luck.

For nearly a year, Skoug did the job, trying at each stop to overcome the hostility that many troops felt for civilian contractors who surfed the Internet and played pool and watched movies all day for big dollars while soldiers carrying seventy-pound packs of gear labored in huts with broken air conditioning the civilian techs couldn't be bothered to repair. "They'd have the easiest thing to fix, and they wouldn't do it," Skoug says. "They'd write that they'd fixed it or that they just needed a part and then just leave it." At Haditha Dam, Skoug witnessed a near-brawl after some Marines, trying to get some sleep after returning from patrol, couldn't get a group of "KBR dudes" to turn down the television in a common area late at night.

Toward the end of Skoug's stay, insurgent activity in his area increased to the point where the soldiers leading his convoys would often drive only at night and without lights. Skoug and his co-workers asked Wolfpack to provide them with night-vision goggles that cost as little as $1,000 a pair, but the company refused. "Their attitude was, we don't need 'em and we're not buying 'em," says Thomas Lane, a Wolfpack employee who served as Skoug's security man on the night of September 11th.

On that evening, the soldiers leading the convoy refused to let Skoug drive his own vehicle back to Heet without night-vision goggles. So a soldier took Skoug's car, and Skoug was forced to be a passenger in a military vehicle. "We start out the front gate, and I find out that the truck that I was in was the frickin' lead truck," he recalls. "And I'm going, 'Oh, great.' "

The bomb went off about a half-hour later, ripping through the truck floor and destroying four inches of Skoug's left femur. "The windshield looked like there was a film on it," he says. "I find out later it was a film -- it was blood and meat and stuff all over the windshield on the inside." Skoug was loaded into the back of a Humvee, his legs hanging out, and evacuated to an Army hospital in Germany before being airlifted back to the States.

When Skoug arrived, it was his wife, Linda, who had to handle all his affairs. She was the one who arranged for an air ambulance to take him to Houston, where she had persuaded an orthopedic hospital to admit him as a patient. She had to do this because almost right from the start, Wolfpack washed its hands of Russell Skoug. The insurance policy he had been given turned out to be useless -- the company denied all coverage, beginning with a $72,597 bill for his stay in the German hospital. Despite assurances from Wolfpack chief Mark Atwood that he would cover all Skoug's expenses, neither he nor the insurance company would pay for the $16,000 trip in the air ambulance. Nobody paid for the operations Skoug had in Houston -- as many as three a day, every day for a month. And nobody paid for his subsequent rehab stint in another Houston hospital -- despite the fact that military law requires every company contracting with the government to fully insure all of its employees in the war zone.

Now that he's out, sitting at home on his couch with only partial use of his left hand and left leg, Skoug has a stack of unpaid medical bills almost three inches tall. As he speaks, he keeps fidgeting. He apologizes, explaining that he can't sit still for very long. Why? Because Skoug can no longer afford pain medication. "I take ibuprofen sometimes," he says, "but basically I just grin and bear it."

And here's where this story turns into something perfectly symbolic of everything that the war in Iraq stands for, a window into the soul of for-profit contractors who not only left behind a breathtaking legacy of fraud, waste and corruption but, through their calculating, greed-fueled hijacking of this generation's broadest and most far-reaching foreign-policy initiative, pushed America into previously unknown realms of moral insanity. When I contact Mark Atwood and ask him to explain how he could watch one of his best employees get blown up and crippled for life, and then cut him loose with debts totaling well over half a million dollars, Atwood, safe in his office in Kuwait City and contentedly suckling at the taxpayer teat, decides that answering this one question is just too much to ask of poor old him.

"Right now," Atwood says, "I just want some peace."

When Linda Skoug petitioned Atwood for help, he refused, pointing out that he had kept his now-useless employee on the payroll for four whole months before firing him. "After I have put forth to help you all out," he wrote in an e-mail, "you are going to get on me for your husband not having insurance." He even implied that Skoug had brought the accident upon himself by allowing the Army to place him at the head of the convoy: "He was not even suppose [sic] to be in the lead vehicle to begin with."

And that, ladies and gentlemen, is the story of the Iraq War in a nutshell. In the history of balls, the world has never seen anything like the private contractors George W. Bush summoned to serve in Operation Iraqi Freedom. Collectively, they are the final, polished result of 231 years of natural selection in the crucible of American capitalism: a bureaucrat class capable of stealing the same dollar twice -- once from the taxpayer and once from a veteran in a wheelchair.

The explanations that contractors offer for all the missing dollars, all the myriad ways they looted the treasury and screwed guys like Russell Skoug, rank among the most diabolical, shameless, tongue-twisting bullshit in history. Going back over the various congres­sional hearings and trying to decipher the corporate responses to the mountains of thefts and fuck-ups is a thrilling intellectual journey, not unlike tackling the Pharaonic hieroglyphs or the mating chatter of colobus monkeys. Standing before Congress, contractors and the officials who are supposed to monitor them say things like "As long as we have the undefinitized contract issue that we have . . . we will continue to see the same kinds of sustension rates" (translation: We can't get back any of the fucking money) and "The need for to-fitnessization was viewed as voluntary, and that was inaccurate as the general counsel to the Army observed in a June opinion" (translation: The contractor wasn't aware that he was required to keep costs down) and "If we don't know where we're trying to go and don't have measures, then we won't know how much longer it's going to take us to get there" (translation: There never was a plan in place, other than to let contractors rip off every dollar they could).

According to the most reliable estimates, we have doled out more than $500 billion for the war, as well as $44 billion for the Iraqi reconstruction effort. And what did America's contractors give us for that money? They built big steaming shit piles, set brand-new trucks on fire, drove back and forth across the desert for no reason at all and dumped bags of nails in ditches. For the most part, nobody at home cared, because war on some level is always a waste. But what happened in Iraq went beyond inefficiency, beyond fraud even. This was about the business of government being corrupted by the profit motive to such an extraordinary degree that now we all have to wonder how we will ever be able to depend on the state to do its job in the future. If catastrophic failure is worth billions, where's the incentive to deliver success? There's no profit in patriotism, no cost-plus angle on common decency. Sixty years after America liberated Europe, those are just words, and words don't pay the bills.

DoJ: "Oversight Board Failed To Report Intelligence Violations"

For 5 1/2 years, not one violation was passed along to the Attorney General.



The Houston Chronicle reports:

An independent oversight board created to identify intelligence abuses after the CIA scandals of the 1970s did not send any reports to the attorney general of legal violations during the first 5 1/2 years of the Bush administration's counterterrorism effort, the Justice Department has told Congress.

Although the FBI told the board of a few hundred legal or rules violations by its own agents after the Sept. 11, 2001, attacks, the board did not identify which of them were indeed legal violations. This spring, it forwarded reports of violations in 2006, officials said.

The President's Intelligence Oversight Board — the principal civilian watchdog of the intelligence community — is obligated under a 26-year-old executive order to tell the attorney general and the president about any intelligence activities it believes "may be unlawful." The board was vacant for the first two years of the Bush administration.

The FBI sent copies of its violation reports directly to Attorney General Alberto R. Gonzales. But the board's mandate was to provide independent oversight, so the absence of such communications has prompted critics to question whether the board was doing its job.

"It's now apparent that the IOB was not actively employed in the early part of the administration. And it was a crucial period when its counsel would seem to have been needed the most," said Anthony Harrington, who served as the board's chairman for most of the Clinton administration.

"The White House counsel's office and the attorney general should have known and been concerned if they did not detect an active and effective IOB," Harrington said. Senate Judiciary Committee chairman Patrick J. Leahy, D-Vt., added: "It is deeply disturbing that this administration seems to spend so much of its energy and resources trying to find ways to ignore any check and balance on its authority and avoid accountability to Congress and the American public."

White House spokeswoman Dana Perino said Friday that "the president expects every single person working in counterterrorism and intelligence strictly to follow the law — and if there are instances where that has not occurred, either intentionally or non-intentionally, he expects it promptly to be corrected." She said the White House was relying on the presidentially appointed director of national intelligence to monitor problems.

Through five previous administrations, members of the board — all civilians not employed by the government — have been privy to some of America's most secret intelligence operations and have served as a private watchdog against unpublicized abuses. The subjects of their investigations and the resulting reports are nearly all classified.

The Bush administration first appointed board members in 2003. Since then, the CIA and the National Security Agency have been caught up in controversy over interrogation tactics at secret prisons, the transfer of prisoners to countries that use torture, and domestic wiretapping not reviewed by federal courts.

Until recently, the board had not told the attorney general about any wrongdoing. "The Attorney General has no record of receiving reports from the IOB regarding intelligence activities alleged to be potentially unlawful or contrary to Executive Order or Presidential directive," the Justice Department told the House Judiciary Committee in a May 9 letter.

White House officials said the board began forwarding reports of problems shortly thereafter. White House officials declined to discuss the board's interactions with President Bush, and said its members could not be interviewed for this report.

President Gerald R. Ford created the board in the mid-1970s after the Church Committee identified numerous abuses by U.S. intelligence agencies. President Ronald Reagan made the board permanent with an executive order in 1981 and gave it the mission to identify legal violations.

Harrington said that under President Clinton, the board sent reports of legal violations by intelligence agencies promptly to the attorney general. Officials said it concluded that the administration showed poor judgment in supporting Iranian arms shipments to Bosnia, and it complained about the CIA's policy of employing known torturers or killers as informants in Latin America.

Perino said that during the first two years of the Bush administration, a career intelligence officer at the White House collected and reviewed reports in which the FBI and other intelligence agencies self-disclosed violations of civil liberties and privacy safeguards.

The board's three or four members — it has alternated over the years — are usually drawn from the larger President's Foreign Intelligence Advisory Board, which advises the commander in chief on U.S. intelligence policy and performance. The oversight board has been a mix of intelligence experts, such as George H.W. Bush's choice of former Air Force Gen. Lew Allen, and civilians from other walks of life, such as Bill Clinton's choice of Philadelphia investment banker Harold Pote.

The board now in place is led by former Bush economic adviser Stephen Friedman. It includes Don Evans, friend of the president and a former commerce secretary, former Adm. David Jeremiah and lawyer Arthur B. Culvahouse.

Perino said the board's "original unique mission and primary oversight role has been supplemented" in recent years by new layers of government. The administration now relies on the director of national intelligence — a job created in 2005 — to watch for abuses, along with presidentially appointed inspector generals. As a result, Bush is considering changes to Reagan's executive order, she said.

Clinton-era deputy national security adviser James B. Steinberg said, however, that "you have to have a civilian proxy who on one hand can be trusted with these secrets and can still call the operator on the carpet when they go astray. If you neuter these internal mechanisms, then you are basically saying there is no one watching the henhouse."

On Friday, the FBI and the Justice Department announced several reforms meant to strengthen internal oversight, including the creation of a legal "compliance office" inside the bureau and a review office inside the department that will regularly examine all violations.

Separately, Gonzales wrote the top Republican on the Senate Judiciary Committee, Sen. Arlen Specter of Pennsylvania, to defend his 2005 testimony that there had been no verified civil liberties abuses during the first three years of the efforts against terrorism. The Post reported last week that the FBI had sent Gonzales a half-dozen reports of violations of civil liberties and privacy safeguards before his testimony.

Gonzales wrote Friday that he did not consider the conduct in those reports to be abuses because the violations involved mistakes, not deliberate misconduct. "My testimony was completely truthful, and I stand by that testimony," he wrote.

Leahy scoffed at Gonzales' explanation. "The American people deserve an attorney general who will fully and accurately inform the Senate and the public about violations of civil liberties. Instead, they have one who misleads Congress and then hides behind dictionary definitions," he said.

White House Denies Request For Documents In Pat Tillman's Death

Cpl. Pat Tillman, shown in a 2003 file photo, was killed in Afghanistan by friendly fire on April 22, 2004. (Associated Press)

The Washington Post reports:

The White House has refused to give Congress documents about the death of former NFL player Pat Tillman, with White House counsel Fred F. Fielding saying that certain papers relating to discussion of the friendly-fire shooting "implicate Executive Branch confidentiality interests."

Reps. Henry A. Waxman (D-Calif.) and Thomas M. Davis III (R-Va.), the leading members of the House Committee on Oversight and Government Reform, objected to the refusal yesterday in letters to the White House and the Defense Department.

White House and Pentagon officials have turned over about 10,000 pages of material, but Waxman and Davis said those papers do not include critical documents that would show communications between senior administration officials and top military officers shortly after Tillman was killed in Afghanistan in 2004.

Tillman's celebrity, as one who gave up a professional football contract to join the Army after the Sept. 11, 2001, attacks, made his death major news. The military at first concocted a heroic story about how Tillman, a specialist posthumously promoted to corporal, had been killed in a fierce firefight with the enemy, despite obvious evidence that he had been shot by his own men at close range. More than a month later, a military investigation reported publicly that the death was not linked to enemy fire.

"The main focus of the committee's investigation is to examine what the White House and the leadership of the Department of Defense knew about Corporal Tillman's death and when they knew it," Waxman and Davis said in a letter to Fielding. "Unfortunately, the document production from the White House sheds virtually no light on these matters."

After an oversight hearing in April -- in which Tillman's family members testified -- the committee sought the documents to learn about the alleged coverup and the high-level discussions about how to spin the case. Waxman and Davis plan to hold another hearing on Aug. 1.

David Brooks: "End The Farce"

David Brooks writes:

In retrospect, Plamegate was a farce in five acts. The first four were scabrous, disgraceful and absurd. Justice only reared its head at the end.

The drama opened, as these dark comedies are wont to do, with a strutting little peacock who went by the unimaginative name of Joe Wilson.

Mr. Wilson claimed that his wife had nothing to do with his trip to investigate Iraqi purchases in Niger, though that seems not to have been the case. He claimed his trip proved Iraq had made no such attempts, though his own report said nothing of the kind.

In short order, Wilson established himself as the charming P.T. Barnum of the National Security set, an inveterate huckster who could be counted on to wrap every actual fact in six layers of embellishment. His small part in the larger fiasco of the Iraq war would not have registered a micron of attention had the villain of the epic — the vice president — not exercised his unfailing talent for vindictive self-destruction.

Act Two opened with a cast of thousands crowding the stage, filling the air with fevered vapors and gleeful rage. Perhaps you can remember those days, when the Plame story pretended to be about the outing of an undercover C.I.A. agent. Perhaps you can remember the howls of outrage from our liberal friends, about the threat to national security, the secret White House plot to discredit its enemies.

Perhaps you remember the media stakeouts of Karl Rove’s driveway, the constant perp-walk photos of Rove on his way to and from the grand jury, the delirious calls from producers (The indictment is coming today! The indictment is coming today!).

There were media types so eager to get Rove, so artificially appalled at the thought of somebody actually leaking classified information, they were willing to forgive prosecutor Patrick Fitzgerald for throwing journalists in jail. It was like watching a city of Ahabs getting deliriously close to the great white whale.

That was back when everybody thought Rove was the key leaker. But then it turned out he wasn’t. Richard Armitage was, as Fitzgerald knew from the start.

By the start of Act Three, nobody cared about the outing of a C.I.A. agent. That part of the scandal disappeared. And all that was left of Joe Wilson and Valerie Plame were the creepy photos in Vanity Fair.

Act Three was the perjury act, and attention shifted to the unlikely figure of Scooter Libby. As Joe Wilson was an absurd man with a plain name, Scooter Libby was a plain man with an absurd name. And the odder thing was that Libby was the only normal person in the asylum. People who knew him thought him discreet, honest and admirable. And yet the charges were brought and the storm clouds of idiocy gathered once more.

Republicans who’d worked themselves up into a spittle-spewing rage because Bill Clinton lied under oath were appalled that anybody would bother with poor Libby over lying under oath. Democrats who were outraged that Bill Clinton was hounded for something as trivial as perjury were furious that Scooter Libby might not be ruined for a crime as heinous as perjury. It was an orgy of shamelessness. The God of Self-Respect took sabbatical.

The trial and sentencing, Act Four, was, to be honest, somewhat anticlimactic. Fitzgerald, having lost all perspective, demanded Libby get a harsh sentence as punishment for crimes he had not been convicted of. The judge, casting himself as David against Goliath, demonstrated an impressive capacity for talking about himself.

And finally, yesterday, came Act Five, and a paradox. Scooter Libby emerged as the least absurd character in the entire drama, and yet he was the one who committed a crime. President Bush entered the stage like a character from another world, a world in which things make sense.

His decision to commute Libby’s sentence but not erase his conviction was exactly right. It punishes him for his perjury, but not for the phantasmagorical political farce that grew to surround him. It takes away his career, but not his family.

Of course, the howlers howl. That is their assigned posture in this drama. They entered howling, they will leave howling and the only thing you can count on is their anger has been cynically manufactured from start to finish.

The farce is over. It has no significance. Nobody but Libby’s family will remember it in a few weeks time. Everyone else will have moved on to other fiascos, other poses, fresher manias.

New British PM Gordon Brown Unveils 'Cabinet of Talents'

Story Highlights
• British PM Gordon Brown holds first meeting with newly appointed cabinet
• Brown promises "new government with new priorities"
• Alistair Darling named finance minister; David Miliband foreign secretary
• Jacqui Smith becomes UK's first female home secretary

CNN reports:

Newly installed British Prime Minister Gordon Brown has held his first cabinet meeting following the UK's biggest government shake-up since the Labour Party came to power in 1997.

Alistair Darling, a longterm political ally of Brown and formerly in charge of transport, was named to the key position of Chancellor of the Exchequer -- the finance role previously held by the new prime minister himself for 10 years.

Former environment minister David Miliband replaced Margaret Beckett as foreign secretary, becoming at 41 the youngest politician since the 1970s to hold one of the UK government's four senior cabinet posts.

"I am tremendously honored," said Miliband, a rising star within Labour ranks who had been tipped as a possible challenger to Brown for the party's leadership.

"The opportunities and challenges of the modern world require, in my view, a diplomacy that is patient as well as purposeful, which listens as well as leads," he told reporters.

Jacqui Smith became the UK's first female home secretary, replacing John Reid as he stepped down from government, while Jack Straw, a former home secretary and foreign secretary, was appointed justice minister.

Despite speculation that Brown would look beyond Labour ranks in building his cabinet, the only non-party appointment saw the former United Nations deputy secretary-general Mark Malloch Brown accept the job of minister for Africa, Asia and the U.N.

Marking the UK government's first change of leadership in a decade, Brown promised "a new government with new priorities" as he addressed reporters outside Dowing Street after taking over from Tony Blair on Wednesday.

"I will build a government that uses all the talents. I will invite men and women of good will to contribute their energies in a new spirit of public service."

Brown faces the task of re-building faith in a Labour administration which has seen its achievements -- including three straight general election victories, peace to Northern Ireland and a sustained economic boom -- tarnished by the Iraq war, the cash-for-honors row and the Blair government's perceived preoccupation with media spin.

Blair was questioned by police for a third time in their investigation of allegations that honors were offered for political contributions, the UK's Press Association reported Thursday. (Full story)

In other developments on Thursday, Brown split the Department of Education into two cabinet posts, separating responsibility for schools and children from a new Department for Innovation, Universities and Skills.

He also abolished the Department for Trade and Industry, creating a new Department for Business, Enterprise and Regulatory Reform.

CNN's European Political Editor Robin Oakley said Brown would introduce a different style of government, restoring a more serious tone to British politics after the "sofa-style" decision-making of the Blair years.

"He is a very serious, committed politician very much driven by the values that he learnt from his Presbyterian minister father. We're going to see a lot less glitz and glamour," said Oakley.

"It will be very much a more 'get on the with the job' style of government," said Oakley. "There will be a lot of serious purpose."