Karl Rove Destroyed My Life

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By Paul Alexander

Last week, Al Gore sent an email message urging supporters to give money to Don Siegelman’s legal defense fund. Gore is the latest in a string of high profile supporters to suggest Siegelman, the former Governor of Alabama, was the victim of a Republican plot when he was found guilty of bribery, conspiracy and fraud in 2006, and sentenced to seven years in prison.

Now, in the waning days of the Bush administration, Siegelman is trying to win back his freedom -- not to mention his good name -- in a courtroom in Atlanta. Earlier this year, an appeals court granted his release after he had served nine months, saying the Governor’s appeal had raised "substantial questions" about the case against him. Siegelman’s cause was helped by a bipartisan group of 54 former state attorneys general from across the country who filed a federal appeals brief supporting his bid to overturn the conviction. Republican insiders have also come forward to say Siegelman was unfairly targeted by Rove and his circle.

Making it in prison depends on one’s level of tolerance. I’m used to mopping in my wife’s kitchen. It was just a bigger floor.

Siegelman’s appeal was heard earlier this month and the verdict will determine whether he returns to prison to finish out his sentence, or goes free.

How did a former governor -- and a rising star in the Democratic Party -- end up in a situation like this?

On June 29, 2006, Siegelman and Richard Scrushy, the CEO of HealthSouth, a chain of medical rehabilitation services with facilities both in the United States and abroad, were found guilty by a jury in Montgomery, Alabama, of federal bribery charges. A year later, Judge Mark Fuller, who had clear conflicts of interest in the case -- a company in which he holds a major stake received a $175 million government contract at one point during the legal proceedings -- sentenced Scrushy to almost seven years in prison. Siegelman got 88 months.

There was one central transaction that sent these men to prison for all this time. Not long after Siegelman had been elected governor in 1998, he convinced Scrushy to contribute $500,000 to a political action committee, which was supporting the establishment of a lottery in Alabama to pay for higher education. At the same time, he talked Scrushy into serving on a state hospital regulatory board on which he had already served three times -- appointed by both Democrats and Republicans -- and from which he had recently resigned. To US attorney Leura Canary, the wife of William "Bill" Canary, the close friend and former business associate of Karl Rove, the act constituted bribery, for which she charged the two men. Among the many other charges, dismissed by the jury, this was the one that stuck.

QUESTION: First, was the act for which you and Richard Scrushy convicted actually a crime?

SIEGELMAN: Fifty-four state attorneys general filed a friend of the court brief stating that it has never been a crime in America for a politician or a public official to appoint a contributor to anything, whether it’s ambassador or cabinet member or a member of a board or an agency. The only thing that is a crime is if you swap a position for money. And there has got to be an express agreement that’s provable. Otherwise, the United States Supreme Court says it’s an infringement on a person’s first amendment right to freely associate and make contributions.

QUESTION: The case with you and Scrushy seems especially weak.

SIEGELMAN: Scrushy had just recently resigned from the board and the person I had defeated, Job James, had appointed one of Scrushy’s vice presidents to the position. When I got elected I called Scrushy and said, "I want you to serve in my administration like you did in three previous administration." And he said, "Oh, Governor, do I have to? I just resigned from that board. Can’t I get you the name of somebody?" I said, "Nope, it’s either you or nobody." So he went onto the board reluctantly. And this poor guy is still in prison today.

QUESTION: Many observers believe he is because he would not cooperate with the prosecution to convict you.

SIEGELMAN: In an effort to get me, the prosecution went to Scrushy before they indicted him and said, "Just tell us Siegelman extorted the money; just tell us he twisted your arm." He said, "I can’t do that because that’s not what happened." They went to him after he was indicted and said, "Okay, we will give you another chance. Tell us Siegelman twisted your arm and tried to extort money." He said, "I can’t say that because that’s not what happened." During the trial, he was sitting at the defense table, and they came and got him again and gave him a third chance to throw me under the bus by lying for the prosecution and he wouldn’t do it. This is not the way the justice system in this country is supposed to work.

QUESTION: Describe what happened to you after you were sentenced.

SIEGELMAN: Scrushy and I were taken from the courtroom less than thirty seconds after the gavel came down in handcuffs, shackles, and chains around our waist and ankles. We were put in the back of a police car and driven to Atlanta where we were taken to a maximum-security prison and put in solitary confinement. Then they moved me around the country from prison to prison until I ended up in the swamps of Louisiana.

QUESTION: What was prison like?

SIEGELMAN: You can just imagine. But making it in prison depends on one’s level of tolerance. I’m used to mopping and sweeping floors in my wife’s kitchen. It was just a bigger floor and I had to mop it every day.

Seriously, all my life I’ve worked to try to correct and perfect our system of government to make it more fair, and here I was in the middle of something that wasn’t fair. If God had a purpose in this, it was for me to see how the system is flawed so I can do something about it. There are some things I’d like to see corrected -- flaws in the system that can result in innocent people going to prison. When I get out of this situation for good, I’ll be back before the Judiciary Committee advocating changes.

QUESTION: You have claimed Karl Rove was a driving force behind your prosecution.

SIEGELMAN: We know from documentary evidence and from testimony that Rove was involved in the firing of the US attorneys [at the start of Bush’s second term] and he’s been identified at the scene of the crime in my case. We know that others worked with Rove to carry out his conspiracies to subvert our system of justice and to abuse the power of his office and to misuse the power of the Department of Justice for political purposes.

QUESTION: Some people believe Rove wanted your political career damaged because of your standing in the Democratic Party.

SIEGELMAN: I had endorsed Al Gore in 2000 -- the first governor to do so -- and it wasn’t long after that that they started the investigation. I had made plans after my 2002 re-election -- which I ultimately lost because of the bad press generated by these investigations -- to hit the primary states. I had been secretary of state for eight years, attorney general for four years, lieutenant governor for four years, and governor for four years -- I had all these friends around the country -- so I thought I could gin up a campaign not for me but against George W. Bush, against his war, against his economic policies, and against his education policies.

There is no question in my mind that Rove played a key role in what happened to me. From the beginning, the investigation was started by Rove’s client, the state attorney general Mark Pryor; then the prosecution was carried out by the wife of Rove’s best friend and his former business partner. [They had previously worked as political consultants together in Alabama.] We have a live witness who claims that Bill Canary -- Rove’s partner -- said Rove had taken my case to the Department of Justice. Now it’s up to Congress -- and the House and the Senate judiciary committees -- to bring Rove before the House Judiciary Committee.

QUESTION: Actually, the House Judiciary Committee has already subpoenaed Rove to testify and he has refused to appear.

SIEGELMAN: That’s why it’s so important for the House and the Senate to hold Rove in contempt of Congress and exercise their inherent authority to enforce that subpoena by sending the Capital police to go get him and bring him in or by pursuing the thing through litigation. But one way or the other, it is critically important that the subpoena be upheld. Otherwise, it sends the message to all his accomplices that they are free to carry out their mischief in the future with impunity because nothing is going to happen to him.

QUESTION: Do you believe your case will be taken up by the Obama administration?

SIEGELMAN: There are lots of good fights, and I know that Obama is looking to end the war in Iraq, to provide health care to all Americans, to fix the economy, and to deal with global warning -- there are so many important issues that are out there -- but restoring people’s faith and trust in the government, assuring people the Department of Justice will no longer be used as a political weapon in this country, is vital. We are not going to allow the torture of prisoners in Guantanamo, nor are we going to permit the torturing of witnesses until we get the correct testimony to put political enemies in jail in this country.

A lot of Americans are aware of the injustices that have been going on in the Bush administration. They need to know that the Obama administration is not going to tolerate these kinds of injustices. I am hopeful that the Obama administration will work with an interested House Judiciary Committee (and hopefully a Senate Judiciary Committee) in finding the truth.

QUESTION: Do you hold George W. Bush accountable for what happened to you?

SIEGELMAN: All I know if that for a long time Karl Rove held himself up as a co-president with George Bush. He bragged about being his drinking buddy, his kicking-around buddy in the White House. They shared good times together. He was Bush’s "brain." He was the genius behind Bush. For a long time, I thought they were inseparable. They were as close as close can be. I don’t know what Rove told President Bush. But we need to find out.

I’ve already spent nine months in prison and the guy who gave the money is still in jail for making a contribution so I could persuade the people of Alabama to vote for an education lottery so their children could go to college for free. We need to know how far my case goes up in the Bush administration.

QUESTION: Tell me about the charge of obstruction of justice for which you were convicted.

SIEGELMAN: The obstruction of justice charge is ludicrous. Honda Motor Company offered to give me a motorcycle. Now if I had taken it, they may have had a case -- Siegelman took a motorcycle, an unpaid gift -- but I said no to Honda and bought the motorcycle. The prosecution in my case ended up convicting me for accepting a campaign contribution to a lottery and paying for a free motorcycle.

QUESTION: What are your feelings about your appeal?

SIEGELMAN: I am not worried one way or the other. I hope and believe that the Eleventh Circuit will see through this and reverse and rescind, which means they’ll acquit me of the charges. If not, it’s another fight the Good Lord has put me into and there’s a reason for it. There are enough people in America made aware of Rove’s shenanigans in this case, we’d have a good fight on our hands.

QUESTION: Will you run for public office again?

SIEGELMAN: I don’t think so. I’m at a point in my life where I’d like to help others. Everyone says, "Never say never," but at this point I do not see it in the cards.

Gaza: The Untold Story

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By Ramzy Baroud

It’s incomprehensible that a region such as the Gaza Strip, so rich with history, so saturated with defiance, can be reduced to a few blurbs, sound bites and reductionist assumptions, convenient but deceptive, vacant of any relevant meaning, or even true analytical value.
The fact is that there is more to the Gaza Strip than 1.5 million hungry Palestinians, who are supposedly paying the price for Hamas’s militancy, or Israel’s ‘collective punishment’ whichever way the media decide to brand the problem.

More importantly, Gaza’s existence since time immemorial must not be juxtaposed with its proximity to Israel, failure or success in ‘providing’ a tiny Israeli town - itself built on conquered land that was seen only 60 years ago as part of the Gaza province - with its need for security. It’s this very expectation that made the killing and wounding of thousands of Palestinians in Gaza a price worth paying, in the callous eyes of many.

These unrealistic expectations and disregard of important history will continue to be costly, and will only serve the purpose of those interested in swift generalizations.

Yes, Gaza might be economically dead, but its current struggles and tribulations are consistent with a legacy of conquerors, colonialism and foreign occupations, and more, its people’s collective triumph in rising above the tyranny of those invaders.

In relatively recent history, Gaza became a recurring story following the 1948 influx of refugees, who were driven from their homes by Zionist militias or fled for their families’ sake, hoping to return once Palestine was recovered. They settled in Gaza, subsisting in absolute poverty, a situation that continues, more or less, to this day.

The history of Gaza, and the place itself was largely irrelevant, if not revolting from the point of view of the refugees who poured into the Strip mostly from the south of Palestine, for it represented the pinnacle of their loss, humiliation and, at times, despair. It mattered little to the peasant refugees as they fled to Gaza that that they probably walked on the same ancient road that ran along the Palestinian coast when Gaza was once the last metropolis for travellers to Egypt, just before they embarked on an unforgiving desert journey through Sinai.

So what if Gaza was described as the city, as told in the Book of Judges, where Samson performed his famous deed and perished. Christianity was relevant to the refugees insofar as a few of Gaza’s ancient churches provided shelter to the tired bodies escaping snipers, bullets and massacres. Even the strong belief amongst Muslims that Prophet Muhammad’s - peace be upon him - great-grandfather Hashem died on one of his journeys from Makkah to the Levant and was buried in Gaza, was largely sentimental. His shrine in Gaza City was visited by numerous refugees, who kneeled and prayed to God that they, some day soon, would be sent back to their humble existence, and their ways of life from which they have been forcefully estranged.

But Gaza’s history became more relevant to the refugees when it appeared that their temporary journey to the Strip was likely to be extended. Only then the area’s many stories of conquerors, tragedies, triumphs but also sheer goodness, became of essence. A pilgrim to the Holy Land, who passed through Gaza in 570 AD, wrote in Latin, “Gaza is a splendid city, full of pleasant things; the men in it are most honest, distinguished by every generosity, and warm to friends and visitors.”

Gaza’s history became even more relevant when the refugees realized that their violent encounters with Israel were not yet over, and that they needed the moral tenacity to survive what would eventually be viewed as one of most severe humanitarian catastrophes in recent memory. And indeed, there was much history to marvel upon, and from which to extract strength and substantiation.

Conquerors came and went, and Gaza stood where it still stands today. This was the recurring lesson for generations, even millennia. Ancient Egyptians came and went, as did the Hyksos, the Assyrians, the Persians, the Greeks, the Romans, the Ottomans, the British, and now the Israelis. And through it all, Gaza stood strong and defiant. Neither Alexander the Great’s bloody conquest of 332 BC, nor Alexander Janneus’s brutal attack of 96 BC broke Gaza’s spirit or took away from its eternal grandeur. It always rose again to reach a degree of civilianisation unheard of, as it did in the 5th century AD.

It was in Gaza that the Crusaders surrendered their strategic control of the city to Saladin in 1170, only to open up yet another era of prosperity and growth, occasionally interrupted by conquerors and outsiders with colonial designs, but to no avail.

All the neglected ruins of past civilisations were only reminders that Gaza’s enemies would never prevail, and would, at best, merely register their presence by another neglected structure of concrete and rocks.

Now Gaza is undergoing another phase of hardship and defiance. Its modern conquerors are as unpitying as its ancient ones. True, Gaza is ailing, but standing, it people resourceful and durable as ever, defiant as they have always been, and hell-bent on surviving, for that’s what Gazans do best. And I should know, it’s my hometown.

Regulator Let IndyMac Bank Falsify Report

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By Binyamin Appelbaum and Ellen Nakashima

Agency Didn't Enforce Its Rules, Inquiry Finds

A senior federal banking regulator approved a plan by IndyMac Bank to exaggerate its financial health in a May federal filing, allowing the California company to avoid regulatory restrictions only two months before it collapsed, a federal inquiry has found.

The same regulatory agency, the Office of Thrift Supervision, allowed similar legerdemain by other banks, according to a letter sent yesterday to members of Congress by the Treasury Department's inspector general, Eric Thorson. The letter did not provide details about the other incidents.

The finding that OTS on several occasions "blessed a fiction," in the words of one congressional staffer, renews questions about the agency's relationship with the companies it regulates and about its complicity in the collapse this year of several of the nation's largest thrifts, including Washington Mutual and Countrywide Financial.

The Washington Post reported last month that OTS allowed thrifts to lend massively while reserves against future losses dwindled. Even as problems became apparent, the agency continued to prioritize deregulation. The latest findings underscore that OTS failed to enforce its own rules.

"The role of the Office of Thrift Supervision, as the name says, is to supervise these banks, not conspire with them," said Sen. Charles E. Grassley (R-Iowa). "It's good the inspector general has opened a full-blown audit as a result of this case. Everyone ought to be paying very close attention."

The regulator named in Thorson's letter, Darrel Dochow, was removed from his position yesterday as director of OTS's west division, which supervised Washington Mutual, Countrywide, IndyMac and Downey Savings and Loan, among other banks that have been seized or sold this year.

It is the second time Dochow has been removed from a position as a senior thrift regulator. He was demoted in the early 1990s after federal investigators found that he had delayed and impeded proper regulation of Charles Keating's failed Lincoln Savings and Loan.

Dochow did not return calls to his office and home. An OTS spokesman also did not return calls. In a letter to the inspector general, OTS director John M. Reich described Dochow's actions as a "relatively small factor in the events leading to the failure of IndyMac." Dochow has been reassigned to work in Washington on "special projects" and as head of human resources, pending completion of the inquiry, according to a memo sent to OTS staff yesterday.

Thorson's investigation has its roots in a standard review of IndyMac's failure. The review was triggered because OTS is an arm of the Treasury.

During that review, Thorson found the Dochow incident described in documents provided by IndyMac's accounting firm, Ernst & Young. Thorson presented those findings to Treasury Secretary Henry M. Paulson Jr., who urged him to investigate, according to a Treasury spokeswoman.

The core allegation is that Dochow allowed IndyMac to count money it got in May in describing its financial condition at the end of March.

Banks are required to file a report with regulators every three months detailing their financial condition, in addition to the reports filed by all publicly traded companies. IndyMac's initial filing for the first quarter showed that the amount of money it had on hand to cover potential losses was just large enough to meet regulatory requirements. But days after it submitted the filing, IndyMac was told by Ernst & Young that some numbers needed to be adjusted. The changes would drop the company below the capital threshold. Instead of "well capitalized," IndyMac would be categorized as "adequately capitalized," according to Thorson's letter.

Such a downgrade would threaten IndyMac's survival. Thrifts classified as "adequately capitalized" need special permission from regulators to gather deposits through brokers who funnel money from investors around the country. The use of brokers is restricted to healthy institutions because the money is seen as "hot," meaning that investors are quick to move money around, which can destabilize a weak institution.

At the end of March, 36 percent of IndyMac's $18.7 billion deposit base came through brokers, according to the company's regulatory filings.

IndyMac executives, who learned about the problem in early May, wanted permission to inject $18 million into the company's capital cushion. But that would solve the problem only if the bank could pretend the money was injected at the end of March.

Thorson wrote that Dochow gave his permission during a May 9 conference call, and the company submitted the new numbers.

The company's first-quarter earnings report, filed on May 12, includes the same numbers sent to banking regulators, apparently repeating the overstatement of the company's actual capital cushion as of March 31. The filing goes on to describe the company as "well capitalized."

Securities experts said the filing could raise legal issues because it is a crime to knowingly make false statements in the financial records of a public company.

The new numbers also averted an intervention by the Federal Deposit Insurance Corp., which could have acted to limit the eventual cost of IndyMac's failure. The FDIC now estimates the cost at about $8.9 billion. The agency is funded by the banking industry.

"It is their job to be a cop," said Bart Dzivi, a lawyer who represents financial services institutions in Northern California. "But Darrel Dochow and senior management take the view, 'We're working with these institutions to help them with their problems.' They see themselves as consultants, not cops."

A spokesman for Thorson declined to expand on his statement that other banks were allowed to make similar revisions to financial statements. Asked at a briefing with members of Congress whether he would describe the problems as "systemic," Thorson responded, "Yes," according to a congressional aide who attended the briefing.

Dochow was appointed regional director in September 2007 after serving as the No. 2 in the western region. Dochow got the job shortly after playing a leading role in persuading Countrywide to move under OTS supervision, a major coup for the agency, which is funded by fees from the companies it oversees. He was paid $230,000 in 2007, according to government records.

Dochow's efforts to help IndyMac extended beyond his support for the bank's revised financial filings.

At another point last spring, Dochow limited the scope of a review by OTS regulators of IndyMac's portfolio of loans and other assets, overruling the advice of others in the agency, according to a source with knowledge of the incident.

The current episode echoes Dochow's involvement in the collapse of Lincoln Savings and Loan.

In September 1987 Dochow halted an examination of Lincoln, which was meant to determine whether the bank had an adequate capital cushion, at the request of his then-boss, Federal Home Loan Bank Board Chairman M. Danny Wall, according to a congressional investigation. Attorneys for Lincoln and its chief executive, Keating, had threatened to sue the bank board, OTS's predecessor, if the exam went ahead.

When the exam finally happened eight months later, it revealed that Lincoln was engaged in unsafe, unsound lending practices, booking inappropriate income and inappropriately sending money to its holding company. The company was placed in conservatorship soon thereafter and taxpayers eventually spent $2.7 billion bailing it out. Dochow was demoted and sent to a regional job.

Then-Rep. Charles E. Schumer (D-N.Y.) said at hearings in November 1990 that Dochow had been carrying out the will of his superiors. Schumer noted that Dochow said in a statement that he got the impression the bank board "would like to see the Lincoln matter resolved amicably."

"In a sense, it's difficult to blame Mr. Dochow, because he apparently was simply carrying out orders, the desires of his superior, to resolve this amicably," Schumer said. "Unfortunately, that desire cost us billions of dollars. And I think it's that attitude that's the real problem here."

Rep. Dennis Kucinich on His Battle With the Banks

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By Rep. Dennis Kucinich

Once they were as gods, but the deities of the American banking system are now in ruins, plunged from their pedestals into the maw of taxpayer largesse. Congress voted to give the banks $700 billion, lifting them temporarily out of their sepulcher of debt, while revealing a deep truth about the condition of America’s financial powers:

They never had the money they said they had as they constructed their debt-based monetary system which now lies in ruins. Their decisions on behalf of depositors, shareholders and investors were lacking in basic integrity and common sense. Green gods bailing out with their golden parachutes.

There was a time when their power was real. Come with me to Cleveland 30 years ago today.

Dec. 15, 1978, Cleveland, Ohio

I awoke to find a curt payment demand that was dropped on my front step by a grandfatherly man who supplemented his Social Security delivering the morning newspaper. The headline plastered across the front page:

Cleveland Trust: Pay Up. Bank would relent if Muny Light were sold, Forbes believes.

One of America’s largest banks, Cleveland Trust, led local banks in demanding immediate payment from the city by midnight, Dec. 15, of $14.5 million in short-term loans.

I regarded the headline skeptically. Having lived in 21 different places by the time I was 17, including a couple of cars, I had come to an encyclopedic knowledge of dun letters, sent to my parents by battalions of bill collectors seeking immediate payment for televisions, cars and a variety of household appliances that never seemed to work. I first came to regard these credit alarms with trepidation, later with impassiveness, with the expectation that as our family grew to two adults and seven children it would soon be on the move again, incurring new delinquencies with each new address. Lack of access to money, housing and credit seemed to be a permanent condition.

Now, having fought through a thicket of consequence to become America’s youngest mayor, elected on a promise to stop the privatization of the city’s electric system, I was faced with paying off loans taken out by the previous mayor, for the financing of municipal projects of dubious value.

The banks refused to extend terms of payment and connived with City Council members to block alternative payment plans, such as the sale of city land or tax revenues. The banks knew the city couldn’t otherwise pay. They demanded instead the sale of the city’s electric system, Muny Light, to an investor-owned electric company, the Cleveland Electric Illuminating Co. (CEI). The president of the Cleveland Council, George Forbes, had met with the head of Cleveland Trust bank, who insisted on the sale of Muny Light as a precondition for extending the city credit. This was a case of the bank blackmailing the city, pure and simple.

The alternative to accepting the bank’s blackmail was default. Cleveland could become the first city since the Depression to default on its financial obligations. Cities rely on credit for everyday operations and for meeting long-term financial obligations, such as infrastructure improvements. If banks called in their loans, the city would head toward dire straits. No one knew that better than the law firm of Squire Sanders and Dempsey, which had served as bond counsel for the city of Cleveland while the city entered fiscal peril and was simultaneously, though not coincidentally, the principal law firm for the Cleveland Electric Illuminating Co. Through Squire Sanders and Dempsey, CEI had access to the intricacies of the city of Cleveland’s financial records.

Under the previous administration, the city began using bond funds for general operating purposes. As mayor, I inherited $40 million worth of debt that had to be refinanced before the end of my first year in office. Under my predecessor, the city had illegally spent money it did not have, and yet it had the key to every bank in town and the confidence of the bond rating houses, at precisely the same time it was preparing for the sale of the municipal electric system to CEI.

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Cleveland Trust and another bank demanding the sale of Muny Light, National City, were principal stock owners in CEI. Several members of CEI’s board sat on the boards of local banks as interlocking directorates. There was a myriad of bank-utility business relations. Cleveland Trust bank, which handled CEI’s demand deposits, pension funds and other assets, would directly profit from the sale of Muny Light. In a way, the banks were the private utility. With the sale, CEI would have an electricity monopoly in Cleveland and would be able to name its price for electricity and get it. Everyone in the Muny Light territory would receive at least a 20 percent rate increase as the rates would be raised to CEI’s levels.

The city was self-sufficient with Muny Light for many years. Muny provided power to 46,000 homes with low electric rates, which contributed to the economic growth of the city. That was until the late 1960s and early ’70s, when a series of suspicious mechanical failures and power outages diminished the system’s reliability. At that time, under heavy lobbying from CEI, the Cleveland City Council delayed the passage of legislation for $9.8 million in repairs to Muny Light’s generators, thereby forcing the city to purchase power at a premium from its competitor, CEI. The city became increasingly dependent on an interconnection between CEI and Muny Light, a high-voltage line over which power could be transferred from CEI to the city, to ensure reliability. The city’s power system began to experience more unexplained power failures. CEI began to make public overtures to purchase Muny Light. The sale of Muny Light to CEI was soon supported by most of Cleveland’s media, business, political and labor interests.

In November 1976, the City Council passed legislation authorizing the sale of Muny Light for a fraction of its value. I was clerk of Cleveland’s Municipal Court at the time and I objected to the sale. I was advised that there was no way to stop the sale, but I saw it differently. Cleveland had a long history of municipal power. I could sense a terrible injustice was being visited upon the people of the city by its leading institutions, which were conspiring to deprive the city of its public power system.

I organized a petition drive that attracted support from city neighborhoods served by Muny Light. A full civic campaign was born with an intense effort made under brutal weather conditions to gather the signatures necessary to put the issue on the ballot. There was much at stake besides the monetary value of the system: The people’s right to own an electric system. And the historic position of Muny Light, one of America’s first municipal electric utilities, founded 70 years earlier by Cleveland Mayor Tom Johnson. Muny Light provided electricity to about one-third of the homes and businesses in the city at a peak savings of 20-30 percent over the rates charged by CEI. Additionally, Muny Light provided millions of dollars annually in savings to taxpayers by serving 76 city facilities. It also provided Cleveland’s street lighting. High electric rates and higher taxes would follow if Muny were sold. The private sector was forcing the sale for its own profit at the expense of the community.

On Jan. 4, 1977, the Atomic Safety and Licensing Board (ASLB), in an antitrust review required of any company applying to operate a nuclear power plant, ruled that CEI had conspired to put Muny Light out of business. CEI tried to force Muny Light into price-fixing and blocked Muny expansion, stopped the installation of Muny Light pollution-abatement equipment and forced the city to buy power it didn’t need. In addition, the ASLB uncovered a CEI budget planning report for 1971 that spoke of a five-year plan “to reduce and ultimately eliminate” Muny Light.

The ASLB determined that CEI deliberately caused a Christmas-season blackout on the Muny Light system and sent salesmen into Muny Light territory offering “reliable CEI service.” The private utility illegally tripled the cost of purchased power, thereby driving up Muny Light’s operating costs. CEI illegally blocked Muny Light’s access to power from other companies, all in violation of federal antitrust law. As a condition of receiving its license to operate a nuclear power plant, CEI had to provide Muny Light with access to cheap power. Documents showed that CEI executives believed the purchase of Muny Light would increase CEI’s earnings by $2.732 a share, eliminate a competitive threat, and push the company’s growth rate to 10 percent, further enhancing investment.

Documents in the case also demonstrated CEI’s successful attempts to subvert media editorial policy through cunning use of the company’s large advertising budget. Over the years, several local reporters lost their jobs after writing reports unfavorable to CEI, and CEI bragged internally about placing verbatim company-written propaganda as general media editorial content.

Confronted with the federal finding that bolstered a previously filed $330 million antitrust damage suit, the Cleveland city administration’s response was incredible: “Now CEI has to buy Muny Light!”

At the same time the campaign to sell Muny Light accelerated, a high-powered rifle shot ripped through my house, just missing my head.

A cavalcade of media editorials commenced favoring the transfer of Muny Light to CEI.

During an ensuing legal battle over the validity of the referendum petitions, I became a candidate for mayor. I promised that if elected I would save the system. I won the election. My first act in office was to cancel the sale of Muny Light. I next had to pay off a $14 million CEI electricity bill that the previous administration owed and wanted to satisfy through the sale of the light system.

I had been in the mayor’s office barely a year, facing a municipal horror story of huge snow storms, massive water main breaks and a police strike. I had cut city spending by 10 percent through eliminating corrupt contracts, payroll padding and attritional cutbacks. Through the year, I struggled with a recall attempt for firing a police chief. The recall was backed by banks, utility and real estate interests with a last-minute appeal printed by the Plain Dealer to sell Muny Light. Credit rating agencies, which had looked the other way while CEI was attempting to gain Muny Light in the previous administration, downgraded the city’s finances.

Another Muny Light-related attempted assassination was averted when I was rushed to a hospital vomiting blood from a profusely bleeding ulcer. Some years later, a congressional investigation produced information from an undercover agent of the Maryland State Police that the assassination attempt was to occur while I was the grand marshal in a local parade. A local television investigative report claimed the assassin’s services were purchased because I refused to sell the electric system.

One month later, I was back at work trying to find a way to save Muny Light. The utility’s financial difficulties, though contrived largely through interference with the system by CEI, were depicted as so overwhelming that only the sale of the electric system itself would save the city from financial catastrophe. I held several meetings with bank officials. and it became clear we were heading for trouble on the question of refinancing. The banks were going to try to force me to sell the electric system. I went public with a plea for an income tax increase to protect the city’s solvency.

On Dec. 15, I made a last-minute appeal to Cleveland Trust. It was 8 o’clock in the morning. I met with Brock Weir, the chairman of Cleveland Trust, Council President Forbes and our host, a local businessman. I had the intention of protecting Muny Light and avoiding a default.

“There’s just one thing you’ve got to do,” said the Council president, who strongly favored the sale.

Weir, the bank CEO with the stern visage: “If you sell Muny Light, we’ll roll over the notes. I can get you $50 million in new financing. We’d get other banks to participate.” It was a bribe.

My thoughts went to the street just outside the boardroom. Some 20 years earlier, a few blocks from where this meeting was taking place, I slept with my brothers and sister and parents in a car, homeless. I remembered an apartment where my parents sat underneath the pale yellow light of a kitchen wall lamp, counting their pennies on an old porcelain-topped table. The pennies dropped, click, click, click. Pennies to pay the utility bills.

It matters how much people pay for electricity. It matters if the public owns its own system and has political and financial control over rates. I could hear the pennies dropping, click, click, click, as Mr. Weir insisted on the sale of Muny Light. I remembered my family and the struggles of people like them. I couldn’t do it. I couldn’t sell. Not for $50 million, not for anything.

“I’m not going to sell, even if it means my career,” I said, as Council President Forbes looked on in surprise.

“Why do you want to end your career? Sell the system. Get rid of it!” he said.

“Is there some other way we can work this out?” I asked Brock Weir.

He shook his head “No.”

Throughout that day, every media outlet in Cleveland echoed the sentiment of Cleveland Trust’s chairman, including the morning newspaper headline, with such depth of coverage and intensity that it seemed the city itself would crumble unless I agreed to the sale, which also included a provision dropping the $330 million antitrust damage suit.

The objective condition of the city’s finances received no honest review. The sale of Muny Light was depicted as the only way the city could avoid fiscal disaster. The majority leader of the City Council held a news conference live on the 6 o’clock news. He declared that if I sold Muny Light, “the chairman of the Cleveland Trust bank has informed the council that his bank will purchase $50 million worth of city bonds. So, in effect, we have a plan sitting on the mayor’s desk that will absolutely end the city’s financial problems, if he will put his signature on it.”

The $50 million bribe had been brought out into the open in a manner that now suggested it was a legitimate offer, a fake solution to a fake crisis. I refused to sell.

As Cleveland television stations covered the event live, with a countdown clock that looked like a twisted version of New Year’s Eve, midnight struck. Television networks of several countries recorded the grim event: The city of Cleveland became the first American city to go into default since the Great Depression. The default was over just $14.5 million dollars in credit.

When I called for a congressional investigation a few days later, Cleveland Trust denied it wanted Muny Light, CEI denied it wanted Muny Light, the council president denied the chairman of Cleveland Trust wanted Muny Light, and the majority leader said he was mistaken when he said live on the 6 o’clock news that the bank chairman offered $50 million in credit for Muny Light. Muny Light was no longer the issue. It was the mayor and his obstinacy that caused the crisis. So went the waltz into a netherworld devoid of truth, justice, reality or morality.

Though the people of Cleveland supported keeping Muny Light by a margin of 2 to 1 in a referendum a few months later, and passed an income tax increase by the same margin in order for the city to pay off the defaulted bond anticipation notes, the state of Ohio intervened and put the city into fiscal receivership. I lost the mayor’s race in 1979. The banks renegotiated the defaulted notes, at a profit. The city lost its antitrust suit against CEI in 1981, in a hung jury. An appeal failed.

I was out of major public office for almost 15 years until, in 1993, Cleveland announced an expansion of Muny Light (now called Cleveland Public Power). At that time, the City Council and others decided that I had made the right decision in refusing to sell Muny Light. The city and its residents had saved hundreds of millions of dollars through Muny Light’s reduced electric rates and the savings the taxpayers enjoyed from Muny’s lower-cost power for street lighting and city buildings.

I attempted another political comeback and this time succeeded, getting elected to the state Senate with the motto: “Because he was right.” My campaign literature showed a radiant light bulb behind my name. Two years later, I was elected to Congress, with the slogan “Light up Congress.” Today I am the chairman of the House Government Oversight Domestic Policy Subcommittee, which has broad jurisdiction over most government departments and agencies, including the Nuclear Regulatory Commission, and electric utility matters generally.

The Cleveland Electric Illuminating Co. is now a subsidiary of First Energy Co., which was fined by the NRC for various safety violations and, a few years ago, was found to have primary responsibility for the 2003 blackout that left 50 million people throughout the northeastern United States without electricity.

Cleveland Trust no longer exists. No other bank involved in the default survives, except for National City, which next week faces extinction through shareholder approval of a takeover by PNC bank. I have spent much time trying to save National City.

One newspaper, the Cleveland Press, which advocated that CEI be Cleveland’s sole electricity provider, ceased publication. The other strong proponent of the sale of Muny Light, the Plain Dealer, struggles to survive.

The city’s electric system endures and this past year celebrated its 100th anniversary.

Schwarzenegger, Dems try to find budget compromise

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By JUDY LIN

With Republicans on the sidelines, Gov. Arnold Schwarzenegger and Democratic leaders met Tuesday to fashion a midyear fix for California's swelling budget deficit.

Senate President Pro Tem Darrell Steinberg emerged from the initial round of discussions and told reporters the talks had been positive. Less than a week ago, Schwarzenegger had threatened to veto the Democratic budget plan that is the basis for the current discussions.

"We're all very committed to making an $18 billion dent into this problem before the end of the year," said Steinberg, D-Sacramento. "That's our obligation."

He said a legislative vote on a compromise could come next week.

The Democratic plan would begin to address the deficit with $9.3 billion in tax and fee increases, $7.3 billion in cuts and another $1.5 billion in labor concessions, court rollbacks and other moves.

Republicans oppose it because of the tax increases. Last week, Schwarzenegger said he would veto it because it failed to include sufficient measures to stimulate the state's economy.

But California's ballooning deficit — projected to hit $42 billion over the next 18 months — is leading to severe consequences that have forced Schwarzenegger and Democrats to act quickly.

Last week, a state panel halted work on 2,000 public works projects because the state could no longer afford to pay for them and Schwarzenegger ordered two-day-a-month furloughs for state workers.

On Monday, the state controller warned that California will run out of cash within 70 days if lawmakers don't act quickly to bridge the growing divide between revenue and spending.

Steinberg said he and Assembly Speaker Karen Bass, D-Los Angeles, were willing to give Schwarzenegger more of what he wanted. That could include making concessions on labor rules and environmental regulations to accelerate work on infrastructure projects, agreeing to build more toll roads in the state and expanding help to homeowners facing foreclosure.

Republicans did not participate in Tuesday's budget negotiations.

Senate Minority Leader Dave Cogdill, R-Modesto, said Republicans would return to the Capitol if a deal were to be reached but said his caucus remained opposed to the package. He and other Republicans believe it is illegal because it contains tax increases yet was passed without a two-thirds vote in the Legislature.

"There's nothing for us to talk about today," said Cogdill, strolling through the Capitol in jeans and a leather jacket.

Anti-tax groups have vowed to sue if Schwarzenegger signs the plan, challenging its legality. Proposition 13, passed by voters 30 years ago, requires a two-thirds vote by lawmakers to raise taxes.

Democrats say they have found a way to get around the two-thirds requirement by claiming their $18 billion plan does not technically increase the amount of taxes on Californians.

Instead, they say it eliminates gas taxes and replaces them with a variety of other charges, including raising the state sales tax by three-quarters of a percentage point, boosting personal income taxes by 2.5 percent, taxing companies that extract oil from California and collecting taxes from independent contractors upfront.

It then replaces the gas taxes with what Democrats call a gasoline fee that would go solely to transportation projects. Because the fee is dedicated to a single purpose, it does not require a two-thirds vote, Democrats say.

Schwarzenegger has said it is necessary to raise taxes, but his opinion about the method contained in the Democratic plan is uncertain. Last week, he called the Democrats' proposal a "terrible budget" that would "punish the people of California." And in a meeting with local leaders in the Central Valley last week, he said their plan included "illegal taxes."

It was not clear Tuesday why the governor had decided to negotiate on a plan that only days ago he said contained provisions that were not legal. His spokesman, Aaron McLear, said Schwarzenegger would not sign anything that is illegal.

After meeting with the Democratic leaders, Schwarzenegger headed to a park near the Sacramento River for a news conference to denounce the halt in public works projects. He was asked whether he would sign a budget plan that contained tax increases but was passed only by a simple-majority vote.

"I prefer having my Republican friends at the table, and I prefer to get a two-thirds vote. But we do need revenue increases," he said. "To save California, I'm forced to negotiate just with the Democrats. This is the situation I am forced in because of lack of participation by the Republicans."

Schwarzenegger said he would let others debate the plan's legality, ultimately deciding "what is a fee and what is a tax?"

Cheney’s admissions to the CIA leak prosecutor and FBI

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By murrayw

Vice President Dick Cheney, according to a still-highly confidential FBI report, admitted to federal investigators that he rewrote talking points for the press in July 2003 that made it much more likely that the role of then-covert CIA-officer Valerie Plame in sending her husband on a CIA-sponsored mission to Africa would come to light.

Cheney conceded during his interview with federal investigators that in drawing attention to Plame’s role in arranging her husband’s Africa trip reporters might also unmask her role as CIA officer.

Cheney denied to the investigators, however, that he had done anything on purpose that would lead to the outing of Plame as a covert CIA operative. But the investigators came away from their interview with Cheney believing that he had not given them a plausible explanation as to how he could focus attention on Plame’s role in arranging her husband’s trip without her CIA status also possibly publicly exposed. At the time, Plame was a covert CIA officer involved in preventing Iran from obtaining weapons of mass destruction, and Cheney’s office played a central role in exposing her and nullifying much of her work.

Cheney revised the talking points on July 8, 2003– the very same day that his then-chief of staff, I. Lewis (Scooter) Libby, met with New York Times reporter Judith Miller and told Miller that Plame was a CIA officer and that Plame had also played a central role in sending her husband on his CIA sponsored trip to the African nation of Niger.

Both Cheney and Libby have acknowledged that Cheney directed him to meet with Miller, but claimed that the purpose of that meeting was to leak other sensitive intelligence to discredit allegations made by Plame’s husband, former ambassador Joseph C. Wilson IV, that the Bush administration misrepresented intelligence information to go to war with Iraq, rather than to leak Plame’s identity.

That Cheney, by his own admission, had revised the talking points in an effort to have the reporters examine who sent Wilson on the very same day that his chief of staff was disclosing to Miller Plame’s identity as a CIA officer may be the most compelling evidence to date that Cheney himself might have directed Libby to disclose Plame’s identity to Miller and other reporters.

This new information adds to a growing body of evidence that Cheney may have directed Libby to disclose Plame’s identity to reporters and that Libby acted to protect Cheney by lying to federal investigators and a federal grand jury about the matter.

Still, for those in search of the proverbial “smoking gun”, the question as to whether Cheney directed Libby to leak Plaime’s identity to the media at Cheney’s direction or Libby did so on his own by acting over zealously in carrying out a broader mandate from Cheney to discredit Wilson and his allegations about manipulation of intelligence information, will almost certainly remain an unresolved one.

Libby was convicted on March 6, 2007 of four felony counts of lying to federal investigators, perjury, and obstruction of justice, in attempting to conceal from authorities his own role, and that of other Bush administration officials, in leaking information to the media about Plame.

One of the jurors in the case, Dennis Collins, told the press shortly after the verdict that he and many other jurors believed that Libby was serving as a “fall guy” for Cheney, and had lied to conceal the role of his boss in directing information about Plame to be leaked to the press.

The special prosecutor in the CIA leak case, Patrick Fitzgerald, said in both opening and closing arguments that because Libby did not testify truthfully during the course of his investigation, federal authorities were stymied from determining what role Vice President Cheney possibly played in directing the leaking of information regarding Plame that led to the end of her career as a covert CIA officer, and jeopardized other sensitive intelligence information.

Speaking of the consequences of Libby’s deceit to the FBI and a federal grand jury, Fitzgerald, who is also the U.S. attorney for Chicago, said in his Feb. 20, 2007 closing argument: “There is talk about a cloud over the Vice President. There is a cloud over the White House as to what happened. Do you think the FBI, the Grand Jury, the American people are entitled to a straight answer?”

The implication from that and other comments made by Fitzgerald while trying the case was that Libby had lied and placed himself in criminal jeopardy to protect Cheney and to perhaps conceal the fact that Cheney had directed him to leak information to the media about Plame.

Although it has been widely reported in the media that Cheney and Libby have denied that Cheney directed Libby ever to speak to reporters about Plame, those reports have been erroneous. As Washington Post.com columnist Dan Froomkin wrote in this largely overlooked column, Libby instead had told both the FBI and a federal grand jury that he was uncertain as to whether or not Cheney had directed him to talk to reporters about Plame.

An FBI agent testified at Libby’s trial, as Froomkin pointed out, that Libby had told the FBI that during a July 12, 2003 conversation that Libby had with Cheney, the two men possibly discussed “whether to report to the press that Wilson’s wife worked for the CIA.”

That conversation occurred exactly four days after Cheney ordered the revision of the talking points and Libby had his conversation with Judith Miller about Plame.

And immediately after that July 12, 2003 conversation between Cheney and Libby, Libby spoke by phone with Matthew Cooper, then a correspondent for Time magazine, and confirmed for Cooper that Plame worked for the CIA and that she had played a role in sending her husband to Niger.

A contemporaneous FBI report recounting the agents’ interview with Libby also asserts that Libby had refused to categorically deny to them that Cheney had directed him to leak information to the press about Plame. A heavily redacted copy of Libby’s interviews with FBI agents was turned over this summer to the House Committee on Oversight and Government Reform.

The committee’s chairman, Rep. Henry Waxman (D-Ca.) wrote Attorney General Michael Mukasey on June 3, 2008, reiterating an earlier request that Mukasey turn over to the committee the FBI report of its interview of Vice President Cheney in regards to the Plame matter:

“In his interview with the FBI, Mr. Libby states that it was `possible’ that Vice President Cheney instructed [Libby] to disseminate information about Ambassador Wilson’s wife to the press. This is a significant revelation and, if true, a serious matter. It cannot be responsibly investigated without access to the Vice President’s interview.”

Mukasey declined to release the Cheney report to Waxman in particular, and Congress in general.

But a person with access to notes of Cheney’s interview with federal investigators described to me what Cheney said during those interviews. Later the same person read to me verbatim portions of the interview notes directly relevant to this story.

***

At the time of the leak of Plame’s identity, Cheney, Libby and other Bush administration officials were attempting to discredit Wilson because of the charges that he was making that the White House had manipulated intelligence information to take the nation to war with Iraq. Wilson, a retired career diplomat and former ambassador, had traveled to Niger in February 2002 on a CIA- sponsored mission to investigate allegations that Saddam Hussein’s regime had attempted to procure uranium from the African nation. Wilson reported back to the CIA that the allegations were most certainly untrue.

Despite numerous warnings from the CIA and elsewhere in government that the Niger allegations were most likely false or even contrived, President Bush cited them in his 2002 State of the Union address as a rationale to go to war with Iraq.

On July 6, 2003, Wilson published an op-ed in The New York Times charging that the Bush administration had “twisted” intelligence when it cited the alleged Niger-Iraq connection in the president’s State of Union earlier that year. At the time, U.N. weapons inspectors in Iraq could not find out weapons of mass destruction. Wilson’s allegations were among the first from an authoritative source that the administration might have misled the nation to go to war.

A central part of the effort to counter Wilson’s allegations entailed discrediting him by suggesting that his slection for the trip had been a case of nepotism. Cheney, Libby, then-White House political adviser Karl Rove, and other White House officials told reporters that Wilson’s wife, who worked at the CIA, had been primarily responsible for selecting him to go to Niger.

The day after Wilson’s op-ed, on July 7, 2003, Cheney personally dictated talking points for then-presidential secretary Ari Fleischer and other White House officials to use to counter Wilson’s charges and discredit him.

A central purpose for writing the talking points was to demonstrate that the Vice President’s office had played little if any role in Wilson being sent to Niger and that Cheney was not told of Wilson’s mission prior to the war with Iraq.

In talking points Cheney dictated on July 7, Cheney wrote as his first one: “The Vice President’s office did not request the mission to Niger.” The three other talking points asserted that the “Vice President’s office was not informed of Joe Wilson’s mission”; that Cheney’s office was not briefed about the trip until long after it occurred, and that Cheney and his aides only learned about the trip when they received press inquiries about it a full year later.

***

About a month prior to Wilson having written his own op-ed for the Times, he had told his story of his mission to Niger to New York Times columnist Nicholas Kristof, who wrote a detailed account of Wilson’s trip and his allegations.

In reaction to that column, Cheney personally made inquiries about the matter to both then-CIA director George Tenet and then-CIA deputy director John McLaughlin, apparently on either June 11 or June 12, 2003, according to evidence made public at Libby’s federal criminal trial. Both Tenet and McLaughlin told Cheney of Plame’s role (in reality, a tenuous one) to the selection of her husband for the Niger mission.

On June 12, Cheney and Libby spoke, and Cheney told Libby about Plame’s supposed role.

In notes that Libby took of the conversation, Libby wrote that Cheney said he been told by the CIA officials that Wilson’s mission to Niger “took place at our behest”-in reference to the CIA. More specifically, the notes indicted the mission was undertaken at the request of the CIA’s covert Counterproliferation Division. The notes said that Cheney told Libby that he had been informed that Wilson’s “wife works in that division.”

Cheney then instructed Libby, according to the notes, to ask the CIA to set the record straight by saying that the Vice President’s office “didn’t known about [the] mission” and “didn’t get the report back”, in reference to the fact that Cheney’s office never received a copy of a CIA debriefing report of Wilson after he returned from Niger.

Surprisingly, despite the prominence of Kristof in particular, and the Times in general, the column was largely ignored– at least for a while.

But Wilson’s own July 6, 2003 Times op-ed column by rekindled the issue. Stoking the flames, Wilson appeared on Meet the Press that same morning to discuss his column.

Wilson’s column, prosecutor Fitzgerald asserted at Libby’s trial, ignited a “firestorm.”

Wilson’s charges, Fitzgerald went on to say, “came in the fourth month of the war in Iraq, the fourth month when weapons of mass destruction were not found. Coming as they did, they ignited a media firestorm… the White House was stunned.”

In a handwritten notation at the bottom of the July 6 op-ed, Cheney wrote out several rhetorical questions regarding Wilson and Plame: “Have they [the CIA] done this before? Send an Amb. to answer a question? Do we ordinarily send people out pro-bono to work for us? Or did his wife send him on a junket?”

The next day, July 7, Cheney crafted talking points to be distributed to the media which emphasized that his office had not requested that Wilson go to Niger, that the CIA had not told him about Wilson’s findings, and that he personally only learned of the matter long after the U.S. invaded Iraq– from press reports.

The four talking points dictated by Cheney to his press aide, Catharine Martin, stated:

*The Vice President’s office did not request the mission to Niger.
* The Vice President’s office was not informed of Joe Wilson’s mission.
*The Vice President’s office did not receive a briefing about Mr. Wilson’s mission after he returned.
*The Vice President’s office was not aware of Mr. Wilson’s mission until recent press reports accounted for it.

Martin, in turn, sent those talking points on to, among others, Ari Fleischer, the-then White House press secretary, who utilized them in his briefing or “gaggle” for the press that morning.

Fleischer told reporters that same day, according to a transcript of the briefing: “The Vice President’s office did not request the mission to Niger. The Vice president’s office was not informed of his mission and he was not aware of Mr. Wilson’s mission until recent press accounts… accounted for it. So this was something that the CIA undertook… They sent him on their own volition.”

Also hat same day, Fleischer, who was planning to leave his position as White House press secretary, had lunch with Libby, during which, according to Fleisher’s testimony at Libby’s trial, Libby spoke extensively about the role of Plame in sending her husband on the Niger mission.

At the lunch, Fleischer would testify, Libby told him: “Ambassador Wilson was sent by his wife. His wife works for the CIA.” Fleischer testified that Libby even referred to Wilson’s wife by her maiden name, Valerie Plame.

“He added it was `hush-hush’, and on the QT,’ and that most people didn’t know it,” Fleisher testified.

The very next morning, on July 8, Libby met with reporter Judith Miller of the New York Times for two hours for breakfast at the St. Regis Hotel in downtown Washington in an effort to staunch the damage done by Wilson’s column.

Miller testified at Libby’s trial during the breakfast Libby told her that Wilson’s wife worked at the CIA and that Plame had played a role in selecting him for his Niger mission.

In testimony before the federal grand jury in the CIA leak case, Libby testified that Cheney had instructed him before the breakfast to “get everything out.” Regarding the allegations that he leaked information to Miller about Plame, Libby told federal investigators that he had never done so.

During the same breakfast, Libby also disclosed to Miller portions of a then-still classified National Intelligence Estimate which Cheney believed demonstrated that the CIA was to blame for robustly endorsing the Niger information as accurate.

President Bush had personally and secretly declassified portions of the NIE for the specific purpose of leaking them to Miller. In disclosing selective portions of the NIE to Miller, only the President, the Vice President, and Libby knew about the secret declassification.

“So far as you know, the only three people who knew about this would be the President, the Vice President, and yourself,” Libby was asked by Fitzgerald during one session by Libby before the federal grand jury hearing evidence in the CIA leak case,

“Correct, sir,” Libby answered.

Also that same day, July 8, 2003, Cheney met again Cathy Martin– this time on Cheney’s office on Capitol Hill. During the meeting, according to an account Martin gave federal investigators, Cheney told Martin that he wanted some changes and additions made to the talking points devised the previous day that had already been disseminated to Fleischer and other White House communications aides.

Martin told investigators that Cheney dictated the changes to her, and in each case, she took down word for word what the Vice President said. (Martin later repeated this same account under oath during Libby’s trial.)

Cheney told Martin that he wanted the very first of the talking points to now read: “It is not clear who authorized Joe Wilson’s trip to Niger.”

Cheney, of course, knew that the CIA had authorized Wilson’s trip and had sent Wilson to Niger. Both Cheney and Libby had been told by a large number of CIA and State Department officials by then that such was the case, according to the sworn testimony of those officials at Libby’s trial. And the day before, Fleisher had told the press that Wilson’s mission to Niger was “something that the CIA undertook” and that they had also “sent him on their own volition.”

Why would Cheney change the talking points from the day before if he knew that the CIA had sent Wilson and he and his staff had encouraged Fleischer to say that the day before? Obviously, saying it was unclear who had authorized Wilson’s trip to Niger was not only untrue, it also pointed reporters in the direction of asking about Plame?

Asked about this during his FBI interview, Cheney was at a loss to explain how the change of the talking points focusing attention on who specifically sent Wilson to Niger would not lead reporters might lead to exposure of Plame’s role as a CIA officer.

There was a matter, as well, as to why Cheney changed the talking points to say it was unclear who sent Wilson when in fact he had admitted earlier during the same interview with investigators that he clearly knew it was the CIA.

Finally, of course, there was the fact that on the very same day that Cheney changed the talking points that Libby was meeting with Miller and telling Miller that Plame worked for the CIA and had sent her husband to Niger.

In his closing argument during the Libby trial, however, Fitzgerald did mention the issue briefly. None of the media covering the trial, however (with the sole exception once again being Dan Froomkin), appeared to understand its significance or broader context, and did not report it.

Noting the change of Cheney’s July 7 and July 8, 2003 talking points, Patrick Fitzgerald said: “The question of who authorized became number one. That’s a question that would lead to the answer: Valerie Wilson.”

***

Four days later, on July 12, 2003 Cheney and Libby strategized again as to how to beat back Wilson’s allegations. They had traveled together, and with thief families, to the Norfolk Naval Station for the commissioning of the nuclear-powered Nimitz-class aircraft carrier, the U.S.S. Ronald Reagan.

On the flight home, Cheney pressed Libby to talk to reporters to once again, hoping to beat back Wilson’s allegations and discredit the former diplomat. Immediately after landing, Libby spoke to then-Time magazine correspondent Matthew Cooper and confirmed for him that Plame worked for the CIA and had played a role in sending her husband to Niger. It was regarding that conversation that Libby told the FBI it was “possible” that Cheney might have told him to discuss Plame.

On July 2, 2007, President Bush commuted Libby’s thirty month prison sentence, saying he was doing so out of compassion for Libby’s family and because he believed that he believed that the sentence was excessive. The White House declined to say whether Bush might consider a full pardon for Libby.

In the next few days, it will become known whether Libby will in fact be pardoned by President Bush in his final days in office.

In the meantime, what the Vice President and the President told the FBI during their own FBI interviews during the Plame investigation will not be officially disclosed by the White House. Despite the fact that prosecutor Fitzgerald has said told Congress that he has no objections to the provision of the reports to Congress, the Bush administration has refused to follow through.

Housing Starts Fall Through the Floor

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By Dean Baker

The Census Bureau reported a sharp drop in housing starts in November from a downwardly-revised October rate. The 625,000 annual rate of construction reported for November is 24.8 percent below the September rate. It is 47.0 percent below the November 2007 rate and it is 70.9 percent below the rate in November of 2005 at the peak of the building boom. In fact, the start reported for November is lower than any rate reported for the last fifty years.

The November drop hit all regions of the country, but the Northeast saw the sharpest downturn. Starts fell by 34.6 percent in the region and are now down by 60.2 percent from year ago levels. This seems to be a case where the Northeast is catching up with the rest of the country, since starts had previously fallen somewhat less in the region. It is worth noting that the absolute levels of starts in the Northeast were far lower than in the other three regions, so this drop has much impact on the national economy.

This plunge in starts is a necessary part of the adjustment process in the housing market. There is no way to eliminate the vast inventory of unsold new and existing homes without a sharp slowing in construction. However, the drop in the last two months suggests that the housing market is in a qualitatively different state than it had been even three months ago.

Presumably, builders are cutting back in large part because credit conditions have tightened to the point that they have no choice. This would be consistent with the tightening of credit that took hold in September.

It is important to recognize that this is not necessarily a case of a “credit crunch” inhibiting economic activity. Given the vast oversupply of homes on the market, building new homes in many areas is not a good business proposition right now. Newly built homes can be expected to sit on the market for more than a year in many areas and may eventually sell for prices that are far below recent levels. Banks would be wise not to make loans to builders under such circumstances even if the banks were fully solvent and solidly capitalized.

It will be interesting to see how this plunge in starts is reflected in prices. There is a considerable lag in the data in the key price indices. The indices reflect contracted prices, but only get reported after sales are closed. The sales that are contracted in November will mostly be closed in January, which means that we will not get price data for the month until February.

However, if the plunge in starts reflects the inability of builders to continue to get credit from banks, then it likely indicates that they are also having difficulty obtaining the credit needed to sustain large inventories of unsold homes. This would imply a large sell-off of inventory, presumably at sharply lower prices. If this is the case, we should expect to see a big upturn in new home sales in the November report that will come out next week, with substantial price declines. (The new home sales data show contract prices, so they are more current than other indices.)

If builders are cutting prices to dump inventory, it does not appear that homeowners have yet followed the same path. The Mortgage Bankers Association's purchase applications index continues to show very low levels, even as mortgage interest rates are approaching 5.0 percent. The low measure on this index is the most glaring refutation of the claim that people are unable to get credit. If creditworthy applicants were being denied loans by banks unable or unwilling to lend, then the ratio of mortgage applications to home sales should be soaring. Since there is no notable increase in this ratio, access to credit is obviously not an issue.

The drop in housing starts indicates that housing will again be a sharp negative in GDP this quarter. With sharp downturns in consumption and a weakening trade picture, 4th quarter GDP is certain to show an extraordinary decline.

It's Official: We're Just a Few Years from Peak Oil

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By George Monbiot

Can you think of a major threat for which the British government does not prepare? It employs an army of civil servants, spooks and consultants to assess the chances of terrorist attacks, financial collapse, floods, epidemics, even asteroid strikes, and to work out what it should do if they happen. But there is one hazard about which it appears intensely relaxed. It has never conducted its own assessment of the state of global oil supplies and the possibility that one day they might peak and then go into decline.

If you ask, it always produces the same response: "global oil resources are adequate for the foreseeable future." It knows this, it says, because of the assessments made by the International Energy Agency (IEA) in its World Energy Outlook reports. In the 2007 report, the IEA does appear to support the government's view. "World oil resources," it states, "are judged to be sufficient to meet the projected growth in demand to 2030;" though it says nothing about what happens at that point, or whether they will continue to be sufficient after 2030. But this, as far as Whitehall is concerned, is the end of the matter. Like most of the rich world's governments, the United Kingdom treats the IEA's projections as gospel. Earlier this year, I submitted a Freedom of Information request to the UK's Department for Business, asking what contingency plans the government has made for global supplies of oil peaking by 2020. The answer was as follows: "the Government does not feel the need to hold contingency plans specifically for the eventuality of crude oil supplies peaking between now and 2020."

So the IEA had better bloody well be right. In the report on peak oil commissioned by the US Department of Energy, the oil analyst Robert L.Hirsch concluded that "without timely mitigation, the economic, social and political costs" of world oil supplies peaking "will be unprecedented." He went on to explain what "timely mitigation" meant. Even a worldwide emergency response "10 years before world oil peaking", he wrote, would leave "a liquid fuels shortfall roughly a decade after the time that oil would have peaked." To avoid global economic collapse, we need to begin "a mitigation crash program 20 years before peaking." If Hirsch is right and if oil supplies peak before 2028, we're in deep doodah.

So burn this into your mind: between 2007 and 2008 the IEA radically changed its assessment. Until this year's report, the agency mocked people who said that oil supplies might peak. In the foreword to a book it published in 2005, its executive director, Claude Mandil, dismissed those who warned of this event as "doomsayers". "The IEA has long maintained that none of this is a cause for concern," he wrote. "Hydrocarbon resources around the world are abundant and will easily fuel the world through its transition to a sustainable energy future." In its 2007 World Energy Outlook, the IEA predicted a rate of decline in output from the world's existing oilfields of 3.7 percent a year. This, it said, presented a short-term challenge, with the possibility of a temporary supply crunch in 2015, but with sufficient investment any shortfall could be covered. But the new report, published last month, carried a very different message: a projected rate of decline of 6.7 percent, which means a much greater gap to fill.

More importantly, in the 2008 report the IEA suggests for the first time that world petroleum supplies might hit the buffers. "Although global oil production in total is not expected to peak before 2030, production of conventional oil … is projected to level off towards the end of the projection period." These bland words reveal a major shift. Never before has one of the IEA's energy outlooks forecast the peaking or plateauing of the world's conventional oil production (which is what we mean when we talk about peak oil).

But that is as specific as the report gets. Does it or doesn't it mean that we have time to prepare? What does "towards the end of the projection period" mean? The agency has never produced a more precise forecast -- until now. For the first time, in the interview I conducted with its chief economist Fatih Birol, it has given us a date. And it should scare the pants off anyone who understands the implications.

Fatih Birol, the lead author of the new energy outlook, is a small, shrewd, unflustered man with thick grey hair and Alistair Darling eyebrows. He explained to me that the agency's new projections were based on a major study it had undertaken into decline rates in the world's 800 largest oil fields. So what were its previous figures based on? "It was mainly an assumption, a global assumption about the world's oil fields. This year, we looked at it country by country, field by field and we looked at it also onshore and offshore. It was very very detailed. Last year it was an assumption, and this year it's a finding of our study." I told him that it seemed extraordinary to me that the IEA hadn't done this work before, but had based its assessment on educated guesswork. "In fact nobody had done this research," he told me. "This is the first publicly available data".

So was it not irresponsible to publish a decline rate of 3.7 percent in 2007, when there was no proper research supporting it? "No, our previous decline assumptions have always mentioned that these are assumptions to the best of our knowledge -- and we also said that the declines [could be] higher than what we have assumed."

Then I asked him a question for which I didn't expect a straight answer: could he give me a precise date by which he expects conventional oil supplies to stop growing?

"In terms of non-OPEC [countries outside the big oil producers' cartel]", he replied, "we are expecting that in three, four years' time the production of conventional oil will come to a plateau, and start to decline. … In terms of the global picture, assuming that OPEC will invest in a timely manner, global conventional oil can still continue, but we still expect that it will come around 2020 to a plateau as well, which is of course not good news from a global oil supply point of view."

Around 2020. That casts the issue in quite a different light. Mr Birol's date, if correct, gives us about 11 years to prepare. If the Hirsch report is right, we have already missed the boat. Birol says we need a "global energy revolution" to avoid an oil crunch, including (disastrously for the environment) a massive global drive to exploit unconventional oils, such as the Canadian tar sands. But nothing on this scale has yet happened, and Hirsch suggests that even if it began today, the necessary investments and infrastructure changes could not be made in time. Fatih Birol told me "I think time is not on our side here."

When I pressed him on the shift in the agency's position, he argued that the IEA has been saying something like this all along. "We said in the past that one day we will run out of oil. We never said that we will have hundreds of years of oil … but what we have said is that this year, compared to past years, we have seen that the decline rates are significantly higher than what we have seen before. But our line that we are on an unsustainable energy path has not changed."

This of course is face-saving nonsense. There is a vast difference between a decline rate of 3.7 percent and a rate of 6.7 percent. There is an even bigger difference between suggesting that the world is following an unsustainable energy path -- a statement almost everyone can subscribe to -- and revealing that conventional oil supplies are likely to plateau around 2020. If this is what the IEA meant in the past, it wasn't expressing itself very clearly.

So what do we do? We could take to the hills, or we could hope and pray that Hirsch is wrong about the 20-year lead time, and begin a global crash programme today of fuel efficiency and electrification. In either case, the British government had better start drawing up some contingency plans.

The Grinning Skull

Go to Original
By Rebecca Solnit

The Homicides You Didn't Hear About in Hurricane Katrina

What do you do when you notice that there seems to have been a killing spree? While the national and international media were working themselves and much of the public into a frenzy about imaginary hordes of murderers, rapists, snipers, marauders, and general rampagers among the stranded crowds of mostly poor, mostly black people in New Orleans during Hurricane Katrina, a group of white men went on a shooting spree across the river.

Their criminal acts were no secret but they never became part of the official story. The media demonized the city’s black population for crimes that turned out not to have happened, and the retractions were, as always, too little too late. At one point FEMA sent a refrigerated 18-wheeler to pick up what a colonel in the National Guard expected to be 200 bodies in New Orleans’s Superdome, only to find six, including four who died naturally and a suicide. Meanwhile, the media never paid attention to the real rampage that took place openly across the river, even though there were corpses lying in unflooded streets and testimony everywhere you looked -- or I looked, anyway.

The widely reported violent crimes in the Superdome turned out to be little more than hysterical rumor, but they painted African-Americans as out-of-control savages at a critical moment. The result was to shift institutional responses from disaster relief to law enforcement, a decision that resulted in further deaths among the thirsty, hot, stranded multitude. Governor Kathleen Blanco announced, "I have one message for these hoodlums: These troops know how to shoot and kill, and they are more than willing to do so if necessary, and I expect they will." So would the white vigilantes, and though their exact body count remains unknown, at least 11 black men were apparently shot, some fatally.

The parish of Orleans includes both the city of New Orleans on one side of the Mississippi and a community on the other side called Algiers that can be reached via a bridge called the Crescent City Connection. That bridge comes down in another town called Gretna, and the sheriff of Gretna and a lot of his henchmen turned many of the stranded in New Orleans back at gunpoint from that bridge, trapping them in the squalor of a destroyed city, another heinous crime that was largely overlooked. On the Gretna/Algiers side of the river, the levees held and nothing flooded. Next door to Gretna, Algiers is a mostly black community, but one corner of it down by the river, Algiers Point, is a white enclave, a neighborhood of pretty little, well-kept-up wooden houses -- and of killers.

What do you do when you notice that there seems to have been a killing spree? By my second visit to New Orleans almost a year and a half after the hurricane that devastated the place, I had more than enough information to know that something very wrong had happened in Algiers Point. In a report on New Orleans for TomDispatch in March of 2007, I wrote:

"During my trips to the still half-ruined city, some inhabitants have told me that they, in turn, were told by white vigilantes of widespread murders of black men in the chaos of the storm and flood. These accounts suggest that, someday, an intrepid investigative journalist may stand on its head the media hysteria of the time (later quietly recanted) about African-American violence and menace in flooded New Orleans."

I found that journalist in my friend A.C. Thompson who, backed by the Nation magazine, launched an investigation just concluded this week, 21 months after I first approached him. His courageous and meticulous investigation tracked down victims and persecutors, clarified what happened on those days of mayhem in Algiers Point, sued to gain access to, and sifted through, the coroner’s records that mentioned some bulllet-riddled bodies, and dug up some previously unreported police crimes. His stunning report in the Nation, "Katrina’s Hidden Race War," suggests that there’s still more there to find.

A lot of the pieces of the Algiers Point killing spree were out in the open. Several weeks after Hurricane Katrina, community organizer and former Black Panther Malik Rahim had told Amy Goodman on her nationally syndicated program Democracy Now!, "During the aftermath, directly after the flooding, in New Orleans hunting season began on young African American men. In Algiers, I believe, approximately around 18 African American males were killed. No one really know[s] what’s the overall count."

Rahim’s count seems high, but the real toll remains unknown. The young medics who staffed the Common Ground Clinic, co-founded by Rahim, also knew that there had been a spate of killings: like everyone else who came in, the killers and their associates had felt the need to tell their stories, as well as get their tetanus shots or blood pressure meds. The medics, whom Rahim credits with defusing a potential race war in Algiers by reaching out to everyone equally, told me they’d heard murder confessions from the vigilantes and their cohorts (but respected their confidentiality by not passing along names or identifying information).

CNN and the Times Picayune, New Orleans’s paper of record, both published a photograph of a member of the "self-appointed posse" in Algiers Point napping next to five shotguns, an AK-47 assault rifle, and a pistol, but they never got around to asking if the band of white guys had actually used the guns. As it happened, not only did they use the guns, but they confessed -- or boasted -- on videotape to their shootings and killings, tape that ended up in a little-seen documentary called "Welcome to New Orleans." I passed along what I knew to A.C., but a lot of it hadn’t been a secret, just easily visible dots no one was connecting. None was more visible than the attempted murder of Donnell Herrington.

What It’s Like to Be Murdered

One balmy September afternoon, under the shade of the broad-armed oaks of New Orleans’s City Park, Donnell Herrington told us what it’s like to be murdered -- for the men who attacked him shortly after Hurricane Katrina drowned his city intended to kill him and nearly succeeded. Donnell is a soft-spoken guy now in his early thirties and he worries the question of why they shot him, of what they thought they were doing. On what possible grounds could you blast away with a shotgun at a guy walking down a public street who hadn’t even seen you, let alone threatened you?

He knows they consider themselves justified, and he wrestles with the question, but each time it comes up he finally concludes it was a hate crime. It was because he was black.

"I didn’t approach these guys in any way possible for them to react the way they did. It wasn’t a reaction at all it. It was just a hate crime, because a reaction is when somebody try to bring bodily harm on you and you react in self-defense. When the guy actually stepped out and pulled the trigger, I didn’t see him, I didn’t even know what happened to me. The only thing I can remember is feeling a lot of pressure hit my neck and it literally knocked me off my feet."

The close-up shotgun blast had punctured his jugular vein and he had only a little time to get help before he bled to death. He told his friend and cousin to run, found his way to his feet, only to be shot in the back yet again. He fell down again, got up again -- a former athlete, Herrington is many kinds of strong -- and stumbled away, one hand to the blood spurting from his neck.

Herrington had been desperate to get out of the ravaged city where, two days earlier, he’d seen his grandparents’ neighborhood flood, rescued them and a lot of neighbors by boat, left them to be evacuated from the elevated Interstate, walked across the Crescent City Connection to his home in Algiers on the other side of the Mississippi, found its roof crushed by a huge bough, and decided there was nothing left to do but get out himself. On September 1st, day three of the catastrophe, he had set out with his teenage cousin and a friend for the ferry landing in Algiers Point. There, they had been told, you could actually be evacuated when so many people were stranded in the heat and chaos of a drowned city. Not long into that flight they ran into the white men with guns.

On the one-year anniversary of the catastrophe, millions of Americans watched Spike Lee’s When the Levees Broke: A Requiem in Four Acts on HBO. Most of the film is made up of people talking straight into the camera about their Katrina, and one of the talkers is a sweet-voiced, brown-skinned guy: Herrington. He tells the camera:

"We walking down the street, which was in Algiers and I’m talking to my cousin. I had a bottle of water in my hand, and I’m talking to him, we’re talking about different things and before you know it, I heard a boom, a blast. My body lifted up in the air, and I hit the ground, and, you know, my cousin was standing over me and he was howling and he hollering my name and asking if I was okay, and he was hysterical at this time, and looking at the blood on my shirt and my arms.

"And I looked up and saw a white guy with a white t-shirt in his hands coming toward me, so I managed to get up by the grace of God. I managed to get up, and they had some debris in the street, and so when I turned away from the guy he turned toward me with the shotgun, looked like he was trying to reload. So as I turned away from him I jumped over the debris and I heard another bang. Some of the buckshots hit me in the back, and I hit the ground again."

In the film, Herrington pulls up his shirt and shows his torso, peppered with lumps from the buckshot. And then he gestures at the long, twisting, raised scar wound around his neck like a centipede or a snake: "And this is the incision from the surgery from the buckshots that penetrated my neck and hit my jugular vein."

A victim of a horrific attempted murder told his story in a national television special and, though I’m sure lots of viewers wanted to do something, those who really could have done something did nothing. Lee’s film cut away to then governor Kathleen Blanco vowing more law and order against the supposedly rampaging African-American menace of New Orleans.

Herrington is a kind man; one of the first things he said to us was, "I asked God to forgive those guys that done this thing to me. It was kind of hard to even bring myself to that but I know it’s the right thing to do, but at the same time those guys have gotta answer for their actions."

He was a Brink’s truck driver at the time of Katrina, a man with a clean record routinely in charge of hundreds of thousands of dollars in cash, and he attempted to evacuate Katrina with a pocketful of his own cash -- which only underscores how preposterous it was for his prospective murderers to see him as a thief. He nearly bled to death before a local couple drove him to the nearest medical center, where his throat was sewn up. More than three years later, it’s clear that the trauma is still with him.

His friend and cousin were chased down, threatened with pistols, called "nigger," but finally allowed to go, traumatized by their own brush with men who made it clear they’d be happy to kill them.

"Like Pheasant Season in South Dakota"

In 1892, Homer Plessy, a light-skinned black man, was arrested in New Orleans for riding a streetcar then reserved for whites only. A precursor of Rosa Parks, he pursued a landmark lawsuit that went all the way to a racist Supreme Court, which issued the infamous "separate but equal" doctrine that stood until the civil rights battles of the postwar era.

That same year Charles Allan Gilbert drew a picture of a beautiful woman sitting in darkness at her dressing table, her head with mounded hair and its reflection arranged so that if you look at the celebrated drawing another way you see a grinning skull whose teeth are the rows of bottles of perfume and powder. For a year or more -- Katrina was one of the biggest news stories of the past century -- journalists swarmed like ants over New Orleans. The national and international news media, left, right, and center, big and small, print and radio, television and film, saw the beautiful woman and saw as well bogeymen in the shadows of their own lurid imaginations. And they declined to see the big white skull laughing at them.

That death grin can, however, be caught on the faces of the tipsy white people who confess on camera to murdering their neighbors. Separate but equal may have been abolished in the courts, but these people were gunning down African-American men just for walking in the streets in the aftermath of the storm -- segregation by bullet -- gunning them down on the grounds that no black man had the right to be there and any of them was a menace.

On one of my visits to New Orleans after Katrina, I met with Rahim, a solid older man with long dreadlocks who told me in his rumbling voice of the bodies he’d seen in the streets of Algiers and gave me a copy of the documentary Welcome to New Orleans. It showed one of the corpses rotting, in plain sight, under a sheet of corrugated sheet metal. It also showed white vigilantes whooping it up and talking openly about what they had done. At a barbeque shortly after Katrina struck, a stocky white guy with receding white hair and a Key West t-shirt chortles, "I never thought eleven months ago I’d be walking down the streets of New Orleans with two .38s and a shotgun over my shoulder. It was great. It was like pheasant season in South Dakota. If it moved, you shot it."

A tough woman with short hair and chubby arms adds, "That’s not a pheasant and we’re not in South Dakota. What’s wrong with this picture?"

The man responds happily, "Seemed like it at the time."

A second white-haired guy explains, "You had to do what you had to do, if you had to shoot somebody, you had to shoot. It’s that simple."

A third says simply, "We shot ‘em."

I vowed to Rahim then that I would get the murders investigated. After all, it wasn’t just rumors; it was a survivor telling his story on national television and apparent murderers telling theirs in a documentary. Despite the solid evidence, no one was following up -- not the Pulitzer-winning journalists I contacted through friends, nor the filmmaker who captured Herrington, nor the national radio host Rahim spoke to of mass murder, nor the coroners who had some very interesting corpses on their hands, nor the New Orleans police who talked to Herrington in the hospital and whom he approached afterward, no one until the Nation provided A.C. the resources to do it right.

The worst crimes in disasters are usually committed by institutional authorities and those aligned with them. They fear an unpoliced public and believe private property so sacred a right that they’re willing to kill to defend it, or in this case, just on the off-chance that a passerby might fancy their television set. This is the conclusion of the sociologists who have been studying disasters for decades, many of whom I’ve spoken with in the past few years. And this is the pattern of disasters, like the 1906 San Francisco earthquake, in which the public behaved well but the military -- which essentially became a hostile occupying army -- terrorized the public in the name of preventing looting, shot many innocents, and may have killed scores overall. (In some outrageous incidents, New Orleans police evidently gunned down unarmed African-Americans themselves in the wake of Katrina.)

Looting is a term that should be abolished. In major disasters, when the monetary economy evaporates and needs are desperate, taking water, or food, or diapers, or medicine from shuttered stores -- which is what much of the so-called looting consisted of -- is largely legitimate requisitioning. The rest is theft, and in the days after Katrina there was also some theft -- by the New Orleans police, for example, who cleaned out a Cadillac dealership and helped themselves to goods in a WalMart, as well as by stranded citizens who figured they’d been abandoned or imprisoned in the ruined city and that all rules were gone.

Looting is an incendiary, inexact word, suggesting mayhem far beyond the acquisition of commodities. One Algiers Point vigilante claimed to fear that they would come for his elderly mother, but most of the flooded-out evacuees were looking for food, water, information about family members, and a way out of the wreckage. Another vigilante told A.C. that they could tell the three black men they blasted with a shotgun were looters because they were carrying sports apparel with them. That the victims might be evacuating with their own clothing did not occur to these homicidal fabulists, nor did they seem to think that shooting men who might possibly have taken something of modest value from elsewhere was an overreaction.

The vigilantes of Algiers Point seem to have killed, by their own admissions -- or boasts -- several African-American men. A.C. was able to get first-hand accounts of eleven shootings, and my initial sources had told me they heard admissions of about seven killings. One militia member shot a black man dead at close range as he attempted to break into a corner store, another member told A.C., the only time one of the shootings seems tied in any way to a potential property crime. The police and coroner produced almost no record of what went on there and then.

The vigilantes of Algiers Point were classic white-flight people. They had spent decades regarding the central city with terror and resentment, and so saw Katrina not as a tragedy that happened to the neighbors, but as a moment when the dangers confined to the other side of the river were swarming across it. Because the riot was already in their heads, they became the crazed murderers they claimed to fear -- though fear may not have been the driving motive for all of them.

A.C. was told that they turned themselves into an informal militia after one of their number was brutally carjacked by a black man, but another source told me that her relatives were gleeful about the chance to fight a race war against African-Americans and encouraged to do so by law enforcement. Like Rahim, she calls what went on "hunting" and spoke of a photograph she was sent of a vigilante posing like a big-game hunter next to a black murder victim. Which suggests the catastrophe of Katrina was just cover for getting away with a Klan-style killing spree.

"Look Away, Look Away, Look Away, Dixie Land"

Why couldn’t anyone in the mainstream see the story of vigilantes on a rampage? Why didn’t anyone want to see it?

Racism is the obvious answer, the racism that made the killings invisible to some and made others think they weren’t an issue. The racism and corruption of the New Orleans law enforcement system is old news, and it’s not surprising, though it is shameful, that stories like Herrington’s didn’t even trigger police reports, let alone investigations. But the whole world was watching New Orleans and, at one point or another, every major news outlet in the country had someone on the ground there. Maybe a deeper racism made these crimes unimaginable, even when enough evidence was there, even when the skull was laughing out loud. Certainly the murderers have, until now, lived with a strange sense of impunity that has made them cocky and candid about what went down in Algiers Point in the wake of the storm.

These were the people who broke down in the aftermath of Katrina, who reverted to savagery, not the crowds stranded in the Superdome, or the Convention Center, or on the elevated freeways, or in schools and other inadequate refuges from the flooding that overtook New Orleans. It’s important to keep in mind, despite the false stories the media spread in the immediate aftermath of the hurricane, and this grim, true story three years later, that the response to Katrina was mostly about altruism, courage, and generosity. That was the case whether you are considering people like Herrington, who stayed behind to take care of others, or the "Cajun Navy" of white guys with boats, who headed into the city immediately after the storm to rescue the stranded, or the many who took in evacuees or otherwise tried to help, or what, by now, must be hundreds of thousands of volunteers who arrived in the months and years after the storm to cook and build and organize to bring New Orleans back.

It’s also important to keep in mind that, while the small minority who became a freelance militia murdered casually, the catastrophic loss of life in Louisiana -- about 1,500 people, disproportionately elderly -- was largely due to decisions made by another small minority: elected and appointed government authorities, from Mayor Ray Nagin, who hesitated to call a mandatory evacuation and never provided the resources for the most destitute and frail to evacuate, to FEMA director Michael Brown, who posed and dithered while tens of thousands suffered, to New Orleans’s police chief and Louisiana’s governor, both of whom chose to regard a drowned and overheated city as a law-enforcement crisis rather than a humanitarian relief challenge.

In many, many cases, supplies and rescuers were kept out of the city, hospitals were prevented from evacuating the dying, and the ability of civil society to do what the government would not -- save the stranded, succor the sick -- was hindered at every turn. But this story we know. Now, it’s time to know the other half, the grinning skull, the version that turns everything we were told in the first days upside-down and inside out, the story of murders in plain sight almost no one wanted to see. Look at them. Now, may some measure of justice be done.