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Carlyle's way Making a mint inside "the iron triangle" of defense, government, and industry. By Dan Briody January 8, 2002 Like everyone else in the United States, the group stood transfixed as the events of September 11 unfolded. Present were former secretary of defense Frank Carlucci, former secretary of state James Baker III, and representatives of the bin Laden family. This was not some underground presidential bunker or Central Intelligence Agency interrogation room. It was the Ritz-Carlton in Washington, D.C., the plush setting for the annual investor conference of one of the most powerful, well-connected, and secretive companies in the world: the Carlyle Group. And since September 11, this little-known company has become unexpectedly important. That the Carlyle Group had its conference on America's darkest day was mere coincidence, but there is nothing accidental about the cast of characters that this private-equity powerhouse has assembled in the 14 years since its founding. Among those associated with Carlyle are former U.S. president George Bush Sr., former U.K. prime minister John Major, and former president of the Philippines Fidel Ramos. And Carlyle has counted George Soros, Prince Alwaleed bin Talal bin Abdul Aziz Alsaud of Saudi Arabia, and Osama bin Laden's estranged family among its high-profile clientele. The group has been able to parlay its political clout into a lucrative buyout practice (in other words, purchasing struggling companies, turning them around, and selling them for huge profits)--everything from defense contractors to telecommunications and aerospace companies. It is a kind of ruthless investing made popular by the movie Wall Street, and any industry that relies heavily on government regulation is fair game for Carlyle's brand of access capitalism. Carlyle has established itself as the gatekeeper between private business interests and U.S. defense spending. And as the Carlyle investors watched the World Trade towers go down, the group's prospects went up. In running what its own marketing literature spookily calls "a vast, interlocking, global network of businesses and investment professionals" that operates within the so-called iron triangle of industry, government, and the military, the Carlyle Group leaves itself open to any number of conflicts of interest and stunning ironies. For example, it is hard to ignore the fact that Osama bin Laden's family members, who renounced their son ten years ago, stood to gain financially from the war being waged against him until late October, when public criticism of the relationship forced them to liquidate their holdings in the firm. Or consider that U.S. president George W. Bush is in a position to make budgetary decisions that could pad his father's bank account. But for the Carlyle Group, walking that narrow line is the art of doing business at the murky intersection of Washington politics, national security, and private capital; mastering it has enabled the group to amass $12 billion in funds under management. But while successful in the traditional private-equity avenue of corporate buyouts, Carlyle has recently set its sites on venture capital with less success. The firm is finding that all the politicians in the world won't help it identify an emerging technology or a winning business model. Surprisingly, Carlyle has avoided the fertile VC market in defense technology, which now, more than ever, comes from smaller companies hoping to cash in on what the defense establishment calls the revolution in military affairs, or RMA. Thus far, Carlyle has passed up on these emerging technologies in favor of some truly awful Internet plays. And despite its unique qualifications for early-stage funding of defense companies, the firm seems to have no appetite for the sector. Despite its VC troubles, however, the Carlyle Group's core business is set for some good times ahead. Though the group has raised eyebrows on Capitol Hill in the past, the firm's close ties with the current administration and its cozy relationship with several prominent Saudi government figures has the watchdogs howling. And it's those same connections that will keep Carlyle in the black for as long as the war against terrorism endures. For the 11th-largest defense contractor in the United States, wartime is boom time. No one knows that better than the Carlyle Group, which less than a month after U.S. troops began bombing Afghanistan filed to take public its crown jewel of defense, United Defense, a company it has owned for nearly a decade. That this company is even able to go public is testament to the Carlyle Group's pull in Washington. United Defense makes the controversial Crusader, a 42-ton, self-propelled howitzer that moves and operates much like a tank and can lob ten 155-mm shells per minute as far as 40 kilometers. The Crusader has been in the sights of Pentagon budget cutters since the Clinton administration, which argued that it was a relic of the cold war era--too heavy and slow for today's warfare. Even the Pentagon had recommended the program be discontinued. But remarkably, the $11 billion contract for the Crusader is still alive, thanks largely to the Carlyle Group. "This is very much an example of a cold war-inspired weapon whose time has passed," notes Steve Grundman, a consultant at Charles River Associates, a defense and aerospace consultancy in Boston. "Its liabilities were uncovered during the Kosovo campaign, when the Army was unable to deploy it in time. It is exceedingly expensive, and it was a wake-up call to the Army that many of its forces are no longer relevant." But the Carlyle Group was having none of that. While it is impossible to say what U.S. secretary of defense Donald Rumsfeld was thinking when he made the decision to keep the Crusader program alive, people close to the situation claim to have a pretty good idea. Mr. Carlucci and Mr. Rumsfeld are good friends and former wrestling partners from their undergraduate days at Princeton University. And while Carlyle executives are quick to reject any accusations of them lobbying the current administration, others aren't so sure. "In this particular effort, I felt that they were like any other lobbying group, apart from the fact that they are not," said one Washington, D.C., lobbyist with intimate knowledge of the Crusader negotiations, noting the fine line between lobbying and having a drink with an old friend. According to Greg McCarthy, a spokesperson for Representative J.C. Watts Jr. (R: Oklahoma), whose district is home to one of the Crusader's assembly plants, the Carlyle Group's influence was indeed felt at the Pentagon. "Carlyle's strength was within the DoD, because as a rule someone like Frank Carlucci is going to have access," says Mr. McCarthy. "But they have other staff types that work behind the scenes, in the dark, that know everything about the Army and Capitol Hill." Perhaps even more disconcerting than Carlyle's ties to the Pentagon are its connections within the White House itself. Aside from signing up George Bush Sr. shortly after his presidential term ended, Carlyle gave George W. Bush a job on the board of Texas-based airline food caterer Caterair International back in 1991. Since Bush the younger took office this year, a number of events have raised eyebrows. Shortly after George W. Bush was sworn in as president, he broke off talks with North Korea regarding long-range ballistic missiles, claiming there was no way to ensure North Korea would comply with any guidelines that were developed. The news came as a shock to South Korean officials, who had spent years negotiating with the North, assisted by the Clinton administration. By June, Mr. Bush had reopened negotiations with North Korea, but only at the urging of his own father. According to reports, the former president sent his son a memo persuasively arguing the need to work with the North Korean government. It was the first time the nation had seen the influence of the father on the son in office. But what has been overlooked was Carlyle's business interest in Korea. The senior Bush had spearheaded the group's successful entrance into the South Korean market, paving the way for buyouts of Korea's KorAm Bank and Mercury, a telecommunications equipment company. For the business to be successful, stability between North and South Korea is critical. And though there is no direct evidence linking the senior Bush's business dealings in Korea with the change in policy, it is the appearance of impropriety that excites the watchdogs. "We are clearly aware that former President Bush has weighed in on policy toward South Korea and we note that U.S. policy changed after those communications," says Peter Eisner, managing director at the Center for Public Integrity, a watchdog group in Washington, D.C., which has an active file on the Carlyle Group. "We know that former President Bush receives remuneration for his work with Carlyle and that he is capable of advising the current president, but how much further it goes, we don't know." While the Center for Public Integrity looks for its smoking gun, others in Washington say hard evidence is unimportant. "Whether the decisions made by the former president are a real or apparent conflict of interest doesn't matter, because in the public's eye they're equally as damaging," says Larry Noble, executive director and general counsel of the Center for Responsive Politics. "Bush [Sr.] has to seriously consider the propriety of sitting on the board of a group that is impacted by his son's decisions." And the controversy is expected only to increase as Carlyle's investments in Saudi Arabia are scrutinized during the war on terrorism. Mr. Eisner says that very little is known about Carlyle's involvements in Saudi Arabia, except that the firm has been making close to $50 million a year training the Saudi Arabian National Guard, troops that are sworn to protect the monarchy. Carlyle also advises the Saudi royal family on the Economic Offset Program, a system that is designed to encourage foreign businesses to open shop in Saudi Arabia and uses re-investment incentives to keep those businesses' proceeds in the country. But the money flowing out of Saudi Arabia and into the Carlyle Group is of even more interest. Immediately after the September 11 attacks, reports surfaced of Carlyle's involvement with the Saudi Binladin Group, the $5 billion construction business run by Osama's half-brother Bakr. The bin Laden family invested $2 million in the Carlyle Partners II fund, which includes in its portfolio United Defense and other defense and aerospace companies. On October 26, the Carlyle Group severed its relationship with the bin Laden family in what officials termed a mutual decision. Mr. Bush Sr. and Mr. Major have been to Saudi Arabia on behalf of Carlyle as recently as last year, and according to reports, the Federal Bureau of Investigation is currently looking into the flow of money from the bin Laden family. Carlyle officials declined to answer any questions regarding their activities in Saudi Arabia. But for all the questions, Carlyle has stayed clean in the eyes of the law. Lobbying laws in Washington, D.C., are ambiguous at best, requiring only that former politicians observe a one-year "cooling-off period" before they reënter the lobbying scene on behalf of industry. It is playing within this gray area that has given the Carlyle Group some of the best returns in the business. After David Rubenstein, a former aide in the Carter administration, and William Conway Jr., former chief financial officer of MCI Communications, hooked up at New York's Carlyle hotel in 1987 to form the company, the Carlyle Group spent two lost years investing in a hodgepodge of companies. It wasn't until 1989, when the company brought in Mr. Carlucci, fresh off his two-year stint as U.S. secretary of defense, that Carlyle got serious in government. In 1991 the company made a name for itself by facilitating a $590 million purchase of Citicorp stock for Prince Alwaleed bin Talal. Shortly thereafter, Carlyle snatched up defense contractors Harsco, BDM International, and LTV, turning the companies around and selling them to the likes of TRW, Boeing, and Lockheed Martin. The Carlyle Group has diversified its holdings since then, investing in everything from bottling companies to natural-food grocers. In the process, it has become one of the biggest, most successful private-equity firms in business, with annualized returns of 35 percent. (Judging by the early numbers from some of their funds, however, like many other private-equity funds, 2001 will be a considerably less profitable year for Carlyle.) "They are the new breed of private equity, acting more like a large mutual fund of private companies," says David Snow, editor of PrivateEquityCentral.net, a Web site that tracks private-equity firms. The numbers are impressive: Carlyle employs 240 people, as opposed to the 10 or 12 typical of most private-equity firms. It has ownership stakes in 164 companies, which collectively employ more than 70,000 people. George Soros invested $100 million in the group's funds; the California Public Employees' Retirement System is in for $305 million. Carlyle has succeeded by raising money first, then finding the talent to manage it. For instance, it raised a fund for buying out telecom companies and hired William Kennard, the former U.S. Federal Communications Commission chairman, to run it. Accused early on of being nothing more than a bunch of Washington grip-and-grinners, Carlyle has proven its critics wrong. At a Salomon Smith Barney private-equity conference last March, a panel of professional investment managers were asked who the best fund managers are. Carlyle cofounder Mr. Conway was one of two managers chosen. With its size and success, questions about the firm's ability to grow revenue has arisen. Carlyle has placed its bets for future growth on the VC markets, which it entered in 1996. But to date, it has found that venture capital is a game with far different rules than that of corporate buyouts. "They may be very established in private equity, but it seems to me that they don't really know the venture capital business," says one VC who has done deals with Carlyle. "In buyouts, you take over a company and fight the management, but in venture capital it's the opposite. You want to work with people." Carlyle executives admit as much. As a result, the Carlyle Europe Venture Partners fund has been slow to commit its capital. So far, it has spent just more than 20 percent of its $660 million, and 3 of its original 17 investments have already folded. None has gone public or been acquired. As Jack Biddle, cofounder of Novak Biddle Venture Partners, dryly puts it, "I haven't been involved in a lot of venture deals where the participation of a president mattered that much. In venture capital, it's all about the technology." For a firm that has made its money in highly regulated, politically charged industries, picking business-to-business plays is hardly second nature. While Carlyle has investments in highly regulated sectors like telecom and banking, it has avoided defense entirely, instead focusing on tech industries that have already gone flat. The firm's European fund alone boasts six B2B companies, two optical-networking companies, and Riot-E, a wireless media play. Jacques Garaïalde, managing director of the Europe fund concedes that expectations have been shifted. "Clearly, we can't make 100 times returns on B2B, but there are some situations in which we can make 3 times." But the struggles in its VC business may be offset, at least temporarily, by the expected windfall from the war on terrorism. The federal government has already approved a $40 billion supplemental aid package to the current budget, $19 billion of which is headed straight to the Pentagon. Some of the additional government spending is likely to find its way into Carlyle's coffers. The Bush administration isn't afraid to mix business and politics, and no other firm embodies that penchant better than the Carlyle Group. Walking that fine line is what Carlyle does best. We may not see Osama bin Laden's brothers at Carlyle's investor conferences any more, but business will go on as usual for the biggest old boys network around. As Mr. Snow puts it, "Carlyle will always have to defend itself and will never be able to convince certain people that they aren't capable of forging murky backroom deals. George Bush's father does profit when the Carlyle Group profits, but to make the leap that the president would base decisions on that is to say that the president is corrupt." LW:224;L:http://w http://www.google.com/ Translate search Search http://www.google.com/ search Search for the facts news.htmnews.htm How will President George W. Bush personally make millions (if not billions) from the War on Terror? The old fashioned way. He'll inherit it. Meet the Carlyle Group Former World Leaders and Washington Insiders Making Billions in the War on Terrorism Bush Baker Carlucci Darman Ramos Major US President Secretary of State Secretary of DefenseWhite House Budget Former President of Former Prime 1988-1992 Bush Administration Reagan Advisor the Phillipines Minister of England Former Director of Administration Bush / Clinton the CIA More on James Currently co-chair of Administrations Baker the RAND Center for Middle East Public Policy Advisory Board Carlyle Senior Carlyle Senior Carlyle Carlyle Managing Carlyle Asia Carlyle Europe Advisor Counselor Chairman/CEO Director Advisory Board Chairman Additional reporting by Lawrence Aragon, Mark Chediak, Julie Landry, Christopher Locke, Eric Moskowitz, Mark Mowrey, and Michael Parsons. Write to Dan Briody. Featured Article The ex-presidents' club Oliver Burkeman and Julian Borger The Carlyle Group in the Wednesday October 31, 2001 News The Guardian It is hard to imagine an address closer to the heart of American power. The offices of the Carlyle Group are on Pennsylvania Avenue in Washington DC, midway between the White House and the Capitol building, and within a stone's throw of the headquarters of the FBI and numerous government departments. Recent Discussions • A little Bushed over ties that blind • Canada's little known link to Carlyle • Carlyle Picks Up Two Pros and Fairchild • Chronology of the Carlyle Group stories. • Defense spending Carlyle Group Also see The Axis of Corporate Evil The address reflects Carlyle's position at the very United Defense Stock Data center of the Washington establishment, but amid Search: tick Ticker comp Name the frenetic politicking that has occupied the higher QuickQuote reaches of that world in recent weeks, few have paid it much attention. Elsewhere, few have even heard UDI GO of it. by Financials.com This is exactly the way Carlyle likes it. For 14 years now, with almost no publicity, the company has been signing up an impressive list of former politicians - including the first President Bush and his secretary of state, James Baker; John Major; one-time World Bank treasurer Afsaneh Masheyekhi and several south-east Asian powerbrokers - and using their contacts and influence to promote the group. Among the companies Carlyle owns are those which make equipment, vehicles and munitions for the US military, and its celebrity employees have long served an ingenious dual purpose, helping encourage investments from the very wealthy while also smoothing the path for Carlyle's defense firms. But since the start of the "war on terrorism", the firm - unofficially valued at $13.5bn - has taken on an added significance. Carlyle has become the thread which indirectly links American military policy in Afghanistan to the personal financial fortunes of its celebrity employees, not least the current president's father. And, until earlier this month, Carlyle provided another curious link to the Afghan crisis: among the firm's multi-million-dollar investors were members of the family of Osama bin Laden. The closest the Carlyle Group has previously come to public attention was last May, when a Seoul- based employee called Peter Chung was forced to resign from his £100,000-a-year job after sending an email to friends - subsequently forwarded to thousands of others - boasting of his plans to "fuck every hot chick in Korea over the next two years". The more business-oriented activities of Carlyle's staff have been conducted much more quietly: since it was founded in 1987 by David Rubenstein, a policy assistant in Jimmy Carter's administration, and two lawyer friends, the firm has been dispatching an array of former world leaders on a series of strategic networking trips. Last year, George Bush Sr and John Major traveled to Riyadh to talk with senior Saudi businessmen. In September 2000, Carlyle hired speakers including Colin Powell and AOL Time Warner chair Steve Case to address an extravagant party at Washington's Monarch Hotel. Months later, Major joined James Baker for a function at the Lanesborough Hotel in London, to explain the Florida election controversy to the wealthy attendees. We can assume that Carlyle pays well. Neither Major's office nor Carlyle will confirm the details of his salary as European chairman - an appointment announced shortly before he left the House of Commons after the election - but we know, for the purposes of comparison, that he is paid £105,000 for 28 days' work a year for an unrelated non-executive directorship. Bush gives speeches for the company and is paid with stakes in the firm's investments, believed to be worth at least $80,000 per appearance. The benefits have attracted political stars from around the world: former Philippines president Fidel Ramos is an adviser, as is former Thai premier Anand Panyarachun - as well as former Bundesbank president Karl Otto Pohl, and Arthur Levitt, former chairman of the SEC, the US stock market regulator. Carlyle partners, who include Baker and the firm's chairman, Frank Carlucci - Ronald Reagan's . In the scheme of the investments and in the scheme of the business of either party it was very small. We have to get this into perspective. http://w But I think there was a sense that there were questions being raised ww.herei and some controversy, and for such a small amount of money it was Why did it happen? nreality.c something that we wanted to put behind us. It was just a business Things we need to know om/911 decision." But if the Binladins' connection to the Carlyle Group lasted about September 11 http://w no more than six years, the current President Bush's own links to the MS Word and Acrobat ww.herei firm go far deeper. In 1990, he was appointed to the board of one of nreality.c Carlyle's first purchases, an airline food business called Caterair, om/911 which they eventually sold at a loss. He left the board in 1992, later to become Governor of Texas. Shortly thereafter, he was responsible for appointing several members of the board which controlled the investment of Texas teachers' pension funds. A few years later, the board decided to invest $100m of public money in the Carlyle Group. The firm's magic touch was already bringing results. Today, it is proving as fruitful as ever. BBC: DID BUSH TURN A BLIND EYE TO TERRORISM? BBC Newsnight Tuesday, November 6, 2001 (BBC TRANSCRIPT) E-Mail Article Printer Friendly Version GREG PALAST: The CIA and Saudi Arabia, the Bushes and the Bin Ladens. Did their connections cause America to turn a blind eye to terrorism? UNNAMED MAN: There is a hidden agenda at the very highest levels of our government. JOE TRENTO, (AUTHOR, "SECRET HISTORY OF THE CIA"): The sad thing is that thousands of Americans had to die needlessly. PETER ELSNER: How can it be that the former President of the US and the current President of the US have business dealings with characters that need to be investigated? PALAST: In the eight weeks since the attacks, over 1,000 suspects and potential witnesses have been detained. Yet, just days after the hijackers took off from Boston aiming for the Twin Towers, a special charter flight out of the same airport whisked 11 members of Osama Bin Laden's family off to Saudi Arabia. That did not concern the White House. Their official line is that the Bin Ladens are above suspicion - apart from Osama, the black sheep, who they say hijacked the family name. That's fortunate for the Bush family and the Saudi royal household, whose links with the Bin Ladens could otherwise prove embarrassing. But Newsnight has obtained evidence that the FBI was on the trail of other members of the] Bin Laden family for links to terrorist organisations before and after September 11th. This document is marked "Secret". Case ID - 199-Eye WF 213 589. 199 is FBI code for case type. 9 would be murder. 65 would be espionage. 199 means national security. WF indicates Washington field office special agents were investigating ABL - because of it's relationship with the World Assembly of Muslim Youth, WAMY - a suspected terrorist organisation. ABL is Abdullah Bin Laden, president and treasurer of WAMY. This is the sleepy Washington suburb of Falls Church, Virginia where almost every home displays the Stars and Stripes. On this unremarkable street, at 3411 Silver Maple Place, we located the former home of Abdullah and another brother, Omar, also an FBI suspect. It's conveniently close to WAMY. The World Assembly of Muslim Youth is in this building, in a little room in the basement at 5613 Leesburg Pike. And here, just a couple blocks down the road at 5913 Leesburg, is where four of the hijackers that attacked New York and Washington are listed as having lived. The US Treasury has not frozen WAMY's assets, and when we talked to them, they insisted they are a charity. Yet, just weeks ago, Pakistan expelled WAMY operatives. And India claimed that WAMY was funding an organisation linked to bombings in Kashmir. And the Philippines military has accused WAMY of funding Muslim insurgency. The FBI did look into WAMY, but, for some reason, agents were pulled off the trail. TRENTO: The FBI wanted to investigate these guys. This is not something that they didn't want to do - they wanted to, they weren't permitted to. PALAST: The secret file fell into the hands of national security expert, Joe Trento. The Washington spook-tracker has been looking into the FBI's allegations about WAMY. TRENTO: They've had connections to Osama Bin Laden's people. They've had connections to Muslim cultural and financial aid groups that have terrorist connections. They fit the pattern of groups that the Saudi royal family and Saudi community of princes - the 20,000 princes - have funded who've engaged in terrorist activity. Now, do I know that WAMY has done anything that's illegal? No, I don't know that. Do I know that as far back as 1996 the FBI was very concerned about this organisation? I do. PALAST: Newsnight has uncovered a long history of shadowy connections between the State Department, the CIA and the Saudis. The former head of the American visa bureau in Jeddah is Michael Springman. MICHAEL SPRINGMAN: In Saudi Arabia I was repeatedly ordered by high level State Dept officials to issue visas to unqualified applicants. These were, essentially, people who had no ties either to Saudi Arabia or to their own country. I complained bitterly at the time there. I returned to the US, I complained to the State Dept here, to the General Accounting Office, to the Bureau of Diplomatic Security and to the Inspector General's office. I was met with silence. PALAST: By now, Bush Sr, once CIA director, was in the White House. Springman was shocked to find this wasn't visa fraud. Rather, State and CIA were playing "the Great Game". SPRINGMAN: What I was protesting was, in reality, an effort to bring recruits, rounded up by Osama Bin Laden, to the US for terrorist training by the CIA. They would then be returned to Afghanistan to fight against the then-Soviets. The attack on the World Trade Center in 1993 did not shake the State Department's faith in the Saudis, nor did the attack on American barracks at Khobar Towers in Saudi Arabia three years later, in which 19 Americans died. FBI agents began to feel their investigation was being obstructed. Would you be surprised to find out that FBI agents are a bit frustrated that they can't be looking into some Saudi connections? MICHAEL WILDES, ( LAWYER) I would never be surprised with that. They're cut off at the hip sometimes by supervisors or given shots that are being called from Washington at the highest levels. PALAST: I showed lawyer Michael Wildes our FBI documents. One of the Khobar Towers bombers was represented by Wildes, who thought he had useful intelligence for the US. He also represents a Saudi diplomat who defected to the USA with 14,000 documents which Wildes claims implicates Saudi citizens in financing terrorism and more. Wildes met with FBI men who told him they were not permitted to read all the documents. Nevertheless, he tried to give them to the agents. WILDES: "Take these with you. We're not going to charge for the copies. Keep them. Do something with them. Get some bad guys with them." They refused. PALAST: In the hall of mirrors that is the US intelligence community, Wildes, a former US federal attorney, said the FBI field agents wanted the documents, but they were told to "see no evil." WILDES: You see a difference between the rank-and-file counter-intelligence agents, who are regarded by some as the motor pool of the FBI, who drive following diplomats, and the people who are getting the shots called at the highest level of our government, who have a different agenda - it's unconscionable. PALAST: State wanted to keep the pro-American Saudi royal family in control of the world's biggest oil spigot, even at the price of turning a blind eye to any terrorist connection so long as America was safe. In recent years, CIA operatives had other reasons for not exposing Saudi-backed suspects. TRENTO: If you recruited somebody who is a member of a terrorist organisation, who happens to make his way here to the US, and even though you're not in touch with that person anymore but you have used him in the past, it would be unseemly if he were arrested by the FBI and word got back that he'd once been on the payroll of the CIA. What we're talking about is blow-back. What we're talking about is embarrassing, career-destroying blow-back for intelligence officials. PALAST: Does the Bush family also have to worry about political blow-back? The younger Bush made his first million 20 years ago with an oil company partly funded by Salem Bin Laden's chief US representative. Young George also received fees as director of a subsidiary of Carlyle Corporation, a little known private company which has, in just a few years of its founding, become one of Americas biggest defence contractors. His father, Bush Senior, is also a paid advisor. And what became embarrassing was the revelation that the Bin Ladens held a stake in Carlyle, sold just after September 11. ELSNER: You have a key relationship between the Saudis and the former President of the US who happens to be the father of the current President of the US. And you have all sorts of questions about where does policy begin and where does good business and good profits for the company, Carlyle, end? PALAST: I received a phone call from a high-placed member of a US intelligence agency. He tells me that while there's always been constraints on investigating Saudis, under George Bush it's gotten much worse. After the elections, the agencies were told to "back off" investigating the Bin Ladens and Saudi royals, and that angered agents. I'm told that since September 11th the policy has been reversed. FBI headquarters told us they could not comment on our findings. A spokesman said: "There are lots of things that only the intelligence community knows and that no-one else ought to know. END OF TRANSCRIPT View the Newsnight report on demand Award-winning reporter Palast writes Inside Corporate America for the London Observer. To read other Palast reports, to contact the author or to subscribe to his column, go to GregPalast.Com news.htmnews.htm Also see Profiles: Counter terrorist John O'Neill Who Killed John O'Neill? The New Yorker From the Daily Brew John O'Neill: The Man Who Knew PBS Frontline Includes video interview with John O'Neill If you believe the media, John P. O'Neill was simply another innocent victim killed in the September 11 attacks on the World Trade Center. But you don't need much imagination to suspect something deeper was at work. Clearly, O'Neill was a man Osama bin Laden wanted dead. O'Neill had been a Deputy Director of the FBI, and Osama bin Laden's main pursuer in the US government. O'Neill had investigated the bombings of the World Trade Center in 1993, a US base in Saudi Arabia in 1996, the US embassies in Nairobi and Dar-Es-Salaam in 1998, and the USS Cole last year. But once the first plane hit the North Tower, Osama bin Laden wouldn't be the only man to profit from O'Neill's death. At the moment of impact, O'Neill became the man who knew too much. Just two weeks, TWO WEEKS, prior to the attack, O'Neill had left his job with the FBI. O'Neill had quit because he believed that the Bush administration had stymied the intelligence agency's investigations on terrorism. O'Neill charged that it had done so even as it bargained with the Taliban on handing over of Osama bin Laden in exchange for political recognition and economic aid. In the ultimate irony, O'Neill had gone public with these charges at the same time that he was leaving the FBI to become the head of security at the World Trade Center. "The main obstacles to investigate Islamic terrorism were US oil corporate interests, and the role played by Saudi Arabia in it," O'Neill reportedly told the authors of an explosive new book, Hidden Truth (Forbidden Truth in the US), by intelligence analysts Charles Brisard and Guillaume Dasquie. Brisard met O'Neill several times last summer and reports that O'Neill complained bitterly that the US State Department - and behind it the oil lobby who make up President Bush's entourage - blocked attempts to prove bin Laden's guilt. Released just last November, Brisard and Dasquie's book was mostly ignored by the US media. But it is beginning to cause a stir. Just two days ago, the story aired for the first time on US television when CNN's Paula Zahn interviewed former Iraqi chief U.N. weapons inspector Richard Bulter. (Read CNN transcript) "The most explosive charge, Paula, is that the Bush administration -- the present one, just shortly after assuming office slowed down FBI investigations of al Qaeda and terrorism in Afghanistan in order to do a deal with the Taliban on oil -- an oil pipeline across Afghanistan" Butler said. Maybe part of the reason Paula left Faux news is because she knew her right wing bosses would never let her run a story like this one. But what Paula didn't explore, or even mention, was that O'Neill was not alive to confirm or refute those charges. What CNN didn't find interesting was the fact that John P. O'Neill was in his 34th-floor office in the World Trade Tower when the first of two hijacked planes hit the building, or that he phoned a son and a friend to reassure them he was fine. What the US media have apparently found less interesting than the death of Clinton's dog is that we have only the government's version of what happened next. O'Neill is reported to have called FBI headquarters, and then re-entered one of the towers to help others. The official story is that O'Neill was inside when the buildings collapsed. How convenient for the Bush administration that Mr. O'Neill would not only die in the attack, but also that he would make such a call. Not only was the Bush administration's most dangerous critic forever silenced, but he also provided the administration the perfect story to explain his death. Can you imagine how the events of the past four months would have differed had John P. O'Neill, former Deputy Director of the FBI and head of security at the World Trade Tower at the time of the attacks, had been alive to tell this story? Can you imagine the uproar this story would be causing if Bill Clinton were still president? As things stand, only time will tell if O'Neill's story is investigated by the US press that found Monica Lewinsky worthy of two years of our lives. Certainly, the authors who have reported it are credible. Till the late 1990s, Brisard was the director of economic analysis and strategy for Vivendi, the giant French conglomerate that owns Universal Studios and effective control of USA Networks. He also worked for French secret services (DST), and wrote for them in 1997 a report on the now famous Al Qaeda network, headed by bin Laden. Dasquie is an investigative journalist and publisher of Intelligence Online, a respected newsletter on diplomacy, economic analysis and strategy. And Richard Bulter, who put the story in play on the US cable networks, is hardly an excitable conspiracy nut. Perhaps the CIA will investigate. But I wouldn't expect much from them. After all, they were apparently unable to penetrate the same Al Qaeda network that welcomed in John Walker, a confused 20 year old kid from California, who is reported to have met bin Laden himself. Forbidden Truth US - Taliban Secret Oil Diplomacy, Saudi Arabia and the Failed Search for bin Laden http://www.am azon.com/exec/ obidos/redirect ?tag=hereinreal ity- 20&path=tg/st ores/detail/- Now available in English, this book was /books/156025 banned in Switzerland at the request of 4149/reviews/q Osama Bin Laden's brother. It's all id=102722000 about State Department dealings with 0/sr=8-1 the Taliban prior to September 11 over http://www.am a gas pipeline that US energy azon.com/exec/ companies were trying to build. This obidos/redirect book highlights the struggle of former ?tag=hereinreal FBI man John O'Neill, who was killed on ity- September 11 working as head of 20&path=tg/st security at the Word Trade Center. Two ores/detail/- weeks earlier, he quit his job as FBI in /books/156025 protest because he felt that Big Oil 4149/reviews/q interests were interfering with his id=102722000 investigation of Islamic Terrorism. 0/sr=8-1 Looking behind the Bushes Great moments in a great American family Much of this article originally appeared in the Progressive Review during the 1992 campaign. It has been updated BUSH INDEX 1918 Prescott Bush Sr., leads a raid on a Indian tomb to secure Geronimo's skull for Skull & Bones. 1937 Prescott Bush's investment firm sets up deal for the Luftwaffe so it can obtain tetraethyl lead. 1942 Three firms with which Prescott Bush is associated are seized under the Trading with the Enemy Act. SARASOTA HERALD-TRIBUNE: The president of the Florida Holocaust Museum said Saturday that George W. Bush's grandfather derived a portion of his personal fortune through his affiliation with a Nazi- controlled bank. John Loftus, a former prosecutor in the Justice Department's Nazi War Crimes Unit, said his research found that Bush's grandfather, Prescott Bush, was a principal in the Union Banking Corp. in Manhattan in the late 1930s and the 1940s. Leading Nazi industrialists secretly owned the bank at that time, Loftus said, and were moving money into it through a second bank in Holland even after the United States declared war on Germany. The bank was liquidated in 1951, Loftus said, and Bush's grandfather and great-grandfather received $1.5 million from the bank as part of that dissolution . . . Loftus pointed out that the Bush family would not be the only American political dynasty to have ties to the "wrong side of World War II." The Rockefellers had financial connections to Nazi Germany, he said. Loftus also reminded his audience that John F. Kennedy's father, an avowed isolationist and former ambassador to Great Britain, profited during the 1930s and '40s from Nazi stocks that he owned. "No one today blames the Democrats because Jack Kennedy's father bought Nazi stocks," Loftus said. Still, he said, it is important to understand these historical connections for what they tell us about politics today. The World War II experience points out how easy it was then -- and remains today -- to hide money in multinational funds. SARASOTA HERALD TRIBUNE 1953 George Bush and the Liedtke brothers form Zapata Petroleum. Zapata's subsidiary, Zapata Offshore, later becomes known for its close ties to the CIA. 1954 The Bush family buys out the Liedtke brothers. 1955 George Bush sets up a Mexican drilling operation, Permago, with a frontman to obscure his ownership. The frontman later is convicted of defrauding the Mexican government of $58 million. 1959 Manuel Noriega recruited as an agent by the US Defense Intelligence Agency. 1960 Some investigators believe George Bush spent part of this year and the next in Miami on behalf of the CIA, organizing rightwing exiles for an invasion of Cuba. Is said to have worked with later Iran-Contra figure Felix Rodriguez. 1961 According to the Realist, CIA official Fletcher Prouty delivers three Navy ships to agents in Guatemala to be used in the Bay of Pigs invasion. Prouty claims he delivered the ships to a CIA agent named George Bush. Agent Bush named the ships the Barbara, Houston and Zapata. Bay of Pigs invasion fails. Right-wingers blame Kennedy for failure to provide air cover. CIA loses 15 men, another 1100 are imprisoned. George Bush invites Rep. TL. Ashley -- a fellow Skull & Boner -- down to Texas for a party in order to meet "an attractive girl." Bush writes that "she may be accompanied by an Austrian ski instructor but I think we can probably flush him at the local dance hall." Bush notes that he's had to unlist his phone because "Jane Morgan keeps calling me all the time." [From a letter in the Ashley archives uncovered by Spy magazine.] Zapata annual report boasts that the company has paid no taxes since it was founded. 1963 John F. Kennedy is assassinated. Internal FBI memo reports that on November 22 "reputable businessman" George H. W. Bush reported hearsay that a certain Young Republican "has been talking of killing the president when he comes to Houston." The Young Republican was nowhere near Dallas on that date. According to a 1988 story in The Nation, a memo from J. Edgar Hoover states that "Mr. George Bush of the CIA" had been briefed on November 23rd, 1963 about the reaction of anti-Castro Cuban exiles in Miami to the assassination of President Kennedy. George says it ain't him, admits he was in Texas but can't remember where. 1964 George Bush runs as a Goldwater Republican for Congress. Campaigns against the Civil Rights Act. 1966 Bush, runs as a moderate Republican, gets elected to Congress. Robert Mosbacher chairs Oil Men for Bush. Apache leader Ned Anderson meets with the Skull & Bones lawyer and George Bush's brother Jonathan who attempt to return the skull Prescott Bush had looted in 1933. Anderson refuses the skull because he says it isn't Geronimo's. 1968 George W. Bush joins Skull & Bones at Yale 1970 Bush loses Senate race to Lloyd Bentsen, despite $112,000 in contributions from a White House slush fund. Jim Baker is campaign chair. Bush later claims to have reported correctly all but $6000 in cash -- which he denies he got. A 1992 story in the New York Times says the $6000 was listed in records of Nixon's "townhouse operation" which was designed in part to make GOP congressional candidates vulnerable to blackmail. 1971 Bush is named UN Ambassador by Nixon. Bureau of Narcotics and Dangerous Drugs finds enough evidence of Noriega's involvement in drug dealing to indict him, but US Attorney's office in Miami considers grabbing Noriega in Panama for trial here to be impractical. State Department also urges BNDD to back off. 1972 Bill Liedtke gathers $700,000 in anonymous contributions for the Nixon campaign, delivering the money in cash, checks and securities to the Committee to Re-Elect the President (the infamous CREEP) one day before such contributions become illegal. Bill says he did it as a favor to George. 1973 Bush is named GOP national chair. Brings into the party the Heritage Groups Council, an organization with a number of Nazi sympathizers. Bush, according to Lowell Weicker, inquires as to whether records of the "townhouse operation" should be burned. Robert Mosbacher wins an offshore drilling concession from Philippine dictator Ferdinand Marcos. Watergate tapes indicate concern by Nixon and aide HR Haldeman that the investigation into Watergate might expose the "Bay of Pigs thing." Nixon also speaks of the "Texans" and the "Cubans." and mentions "Mosbacher." In another tape, Nixon decides following his re-election to get signed resignations from his whole government so he can centralize his power. Says Nixon to John Erlichman: "Eliminate everyone, except George Bush. Bush will do anything for our cause." 1974 Bush is named special envoy to China. 1975 DEA report notes Noreiga's involvement in drug trade. George W. Bush graduates from Harvard Business School 1976 Jerry Ford names George Bush CIA director, his fourth political patronage job in a little over five years. Bush later claims this is the first time he ever worked for the CIA. At his confirmation hearings, Bush says, "I think we should tread very carefully on governments that are constitutionally elected." Bush holds first known meeting with Noriega. Noriega starts receiving $110,000 a year from the CIA. Noriega found to be working for Cubans as well, but keeps his CIA gig. Bush sets up Team B within the CIA, a group of neo-conservative outsiders and generals who proceed to double the agency's estimate of Soviet military spending. Senate committee headed by Frank Church proposes revealing size of the country's black budget -- intelligence spending that, in contradiction to the Constitution, is kept secret even from the Hill. According to journalist Tim Weiner, Bush argues that the revelation would be a disaster and would compromise the agency beyond repair. By a one vote margin the matter is referred to the Senate. It never reaches the floor. Chilean dissident Orlando Letelier is assassinated by Chilean secret police agents. CIA fails to inform FBI of pending plot and of assassins' arrival in US. CIA claims the hit was the work of left-wingers in search of a martyr. Bush writes internal CIA memo asking to see cable on Jack Ruby visiting Santos Trafficante in jail. In 1992, Bush will deny any interest in the JFK assassination while CIA head. Bush claims nuclear war is winnable. 1977 Philippine dictator Marcos buys back Robert Mosbacher's oil concession. Mosbacher claims he was swindled. Philippine officials say they never saw any expenditures by Mosbacher on the project. 1978 Bush, Mosbacher and Jim Baker become partners in an oil deal. From a Washington Post article by Bob Woodward and Walter Pincus: "According to those involved in Bush's first political action committee, there were several occasions in 1978-79, when Bush was living in Houston and traveling the country in his first run for the presidency, that he set aside periods of up to 24 hours and told aides that he had to fly to Washington for a secret meeting of former CIA directors. Bush told his aides that he could not divulge his whereabouts, and that he would not be available." Former CIA chief Stansfield Turner denies such meetings took place. George W. Bush declares his candidacy for the Midland Congressional district. He wins the Republican primary and loses in the general election. George W. Bush begins operations of his oil firm, Arbusto Energy. With the help of Jonathan Bush, he assembles several dozen investors in a limited partnership including Dorothy Bush, Lewis Lehrman, William Draper, and James Bath, a Houston aircraft broker 1979 Fifty Bush family investors and friends, led by uncle Jonathan, a New York Republican Party official and an investment manager, invest $4.7 million to set up young Bush in a company called Arbusto. 1980 Bush becomes Reagan's vice presidential candidate. Runs as a rightwinger again. Mosbacher becomes chief fundraiser for Bush's presidential campaign. Forms a millionaire's club of 250 contributors, each of whom cough up $100,000. William Casey forms a working group to prepare for possible Carter October political surprise. In early October, an Iranian official meets with three top Reagan campaign aides. All three deny memory of the meeting in subsequent proceedings. On October 21, Reagan hints he has a secret plan to release the hostages. This is right around the alleged date of a Paris meeting at which the so-called "October Surprise" was settled. Some allege that at this meeting it was agreed to end the arms embargo against Iran if Iran would release its hostages after the election. While Bush's presence at this meeting has been denied by the House committee investigating the October Surprise, Bush's whereabouts at this critical time remain in doubt. The White House, in fact, has leaked conflicting stories. Rep. Dan Quayle goes on a Florida golfing vacation with seven other men and Paula Parkinson -- an insurance lobbyist who later posed nude for Playboy. Parkinson describes Quayle as a husband on the make, but says she turned him down because she was already having an affair with another congressman. Marilyn Quayle says, "anybody who knows Dan Quayle knows he would rather play golf than have sex." The Reagan-Bush campaign receives stolen copies of Carter's briefing books. Bush's campaign manager, James Baker, forces the dismissal of Bush aide Jennifer Fitzgerald, described in a 1982 Time story as having "much to say about where Bush goes, what he does and whom he sees." Bush continues to pay Fitzgerald out of his own pocket. 1981 Reagan-Bush inaugurated. Hostages released moments before. Shortly thereafter, arms shipments to Iran resume from Israel and America. In July, an Argentinean plane chartered by Israel crashes in Soviet territory. It is found to have made three deliveries of American military supplies to Iran. In a 1991 story in Esquire, Craig Unger quotes Alexander Haig as saying "I have a sneaking suspicion that someone in the White House winked." Says Unger: "This secret and illegal sale of military equipment continued for years afterwards." James Baker named Reagan's chief of staff. SEC filings for Zapata Oil for 1960-66 are found to have been "inadvertently destroyed." Reagan authorizes CIA assistance to Contras. 1982 CIA director William Casey begins Operation Black Eagle to expand US role in Central America. Urges use of "selected Latin American and European governments, organizations and individuals" in the project. Inslaw, a computer software company, signs a $10 million contract to install a case-tracking program in 94 US Attorney's offices. Four months later, after obtaining a copy of Inslaw's proprietary version of the program, the government cancels the contract and begins an aggressive campaign to force the company into bankruptcy. Later sources claim that the program was installed by the CIA and sold to various foreign intelligence agencies. After $3 million is poured into Arbusto with little oil and no profits, just tax shelter George W. Bush changes the company name to Bush Exploration Oil Co. Subsequently he is kept afloat by an investment from Philip Uzielli, a Princeton friend of James Baker III. For the sum of $1 million, Uzielli bought 10% of the company at a time in 1982 when the entire enterprise was valued at less than $400,000. Subsequently, to save the company George W. Bush merges with Spectrum 7, a small oil firm owned by William DeWitt and Mercer Reynolds. DeWitt had graduated from Yale a few years earlier than Bush and was the son of the former owner of the Cincinnati Reds. Bush becomes president of Spectrum 7. He also gets 14% of the Spectrum's stock. Meanwhile, 50 original investors in Arbusto get paid off at about 20 cents on the dollar. 1983 Noriega meets again with George Bush. Bush presents an autographed photo to a WWII Ukrainian leader under the Nazis, whose regime killed 100,000 Jews. KAL 007 crashes under circumstances that remain suspicious to this day. Bush promotes Jennifer Fitzgerald from appointments secretary to executive assistant. Seven staffers resign in protest. Fitzgerald tells the New York Post: "Everyone keeps painting me as this old ogre. I really don't worry about it. All these bizarre things just simply aren't true." Neil Bush forms his first oil company. He puts in $100, his partners contribute $160,000 and Neil is named president of the firm, JNB Exploration. Jeb Bush's business partner, Alberto Duque, goes bankrupt, is eventually convicted of fraud and is sentenced to 15 years in prison. 1984 Jeb Bush lobbies the Department of Health & Human Services on behalf of Cuban--American businessman Miguel Recarey, Jr., whose medical firm later collapses. Recarey, who was close to mobster Santos Trafficante, later disappears with at least $12 million in federal funds. George Bush takes part in meetings to plan increased "third country" aid to the Contras.. CIA mines Nicaraguan harbors. Spectrum 7 Corporation, an Ohio oil exploration outfit owned by Dubya's Yalie pal William DeWitt Jr., buys out Bush Exploration, setting up young Bush as CEO at $75,000 a year and giving him 1.1 million shares of the firm's stock. The company's fortunes soon sink, with $400,000 in losses and a debt of $3 million. 1985 Jennifer Fitzgerald is sent to work on Capitol Hill after stories arise linking her romantically with George Bush. Stuart Spencer's public relation firm starts receiving over $350,000 from Panama to improve Noriega's image. CIA starts using BCCI as a conduit. George Bush thanks Oliver North for "dedication and tireless work with the hostage thing, with Central America." Bush will later deny knowing about the Contra effort until late 1986. Neil Bush joins the board of Silverado S&L, serves until 1988. Silverado loans his partners in JNB $132 million which they never repay. Silverado will eventually collapse at a taxpayer cost of $1 billion. 408 TOW anti-tank missiles are shipped from Israel to Iran. A day later, US hostage Benjamin Weir is released. 1986 VP Bush goes to Honduras to promote support for the Contras. Takes along baseball players Nolan Ryan and Gary Carter. Contra figure Felix Rodriguez meets with Donald Gregg, Bush's national security advisor, to complain about Iran-Contra operatives skimming funds from the Contras. Bush may have made several secret visits to Damascus between 1986- 88 according to a 1992 report in Time, which said two senior GOP senators were pressing for a probe. The allegation is that Bush went to negotiate the release of hostages in Lebanon but in fact stonewalled Syria, "playing for campaign timing. Republicans want to get to the bottom of intelligence-community suspicions that the US somehow blew a chance to free Terry Anderson and his fellow captives." Iranian arms runner Manucher Ghorbanifar proposes "diversion" of profits from Iran arms sales to Contras. George W. Bush and partners receive more than $2 million of Harken Energy stock in exchange for their failing oil well operation, which had lost $400,000 in the prior six months. Bush puts up about $500,000 and gets a $120,000 annual consulting fee along with $131,250 in stock options. After Bush joined Harken, the largest stock position and a seat on its board were acquired by Harvard Management Company. The Harken board gave Bush $600,000 worth of the company's publicly traded stock, plus a seat on the board plus a consultancy that paid him up to $120,000 a year. When Harken runs short of cash it hooks up with investment banker Jackson Stephens of Little Rock, Arkansas, who arranges a $25 million stock purchase by Union Bank of Switzerland. Sheik Abdullah Bakhsh, who joins the board as a part of the deal, is connected to the infamous BCCI. 1987 Bush's former chief of staff, Daniel Murphy, flies to Panama with South Korean influence peddler Tongsun Park on a private plane owned by arms dealer Sargis Soghnalian to meet with Noriega. Murphy later tells a Senate subcommittee that he informed Noriega that he need not resign before the 1988 election despite the Reagan administration public pressure to the contrary. Bill Casey dies. Lee Atwater accuses Robert Dole of spreading stories about Bush and Jennifer Fitzgerald. An agreement is worked out, as reported by Sidney Blumenthal in the Washington Post: "The Dole people didn't spread any rumors and promised not to do it again. And the Bush people haven't spread rumors about the Dole people spreading rumors and won't do it again. " Harken Energy project gets rescued by aid from the BCCI-connected Union Bank of Switzerland in a deal brokered by Jackson Stephens, later to show up as a key supporter of Bill Clinton. 1988 Dan Quayle is named VP candidate. Stuart Spencer is assigned to improve Dan Quayle's image, the same job he handled for Noriega and Nixon. Quayle embarrasses campaign by such statements as "[The Holocaust] was an obscene period in our nation's history," adding that "I didn't live in this century." Prisoner who claimed he sold marijuana to Quayle is put into solitary confinement by the head of federal prisons, aborting a planned news conference shortly before the election. Silverado S&L goes under after receiving 126 cease & desist orders in past four years from the Topeka office of the Office of Thrift Supervision. These orders found conflict of interests, insider abuse and other violations. Dwight Chapin, ex-Nixon dirty trickster, gets job in Bush campaign. Rudi Slavoff becomes head of Bulgarians for Bush. In 1983, Slavoff organized an event honoring Austin App, promoter of the theory that the Holocaust was a hoax. Slavoff joins other GOP ethnic leaders in the Coalition of American Nationalities co-chaired by Edward Derwinski. Among them is a former member of an Hungarian pro-Nazi party. After press revelations, eight of the leaders accused of anti-semitism resign from the campaign. Bush says: "Nobody's giving in... These people left of their own account." GOP flier warns that "all the murderers, rapists and drug pushers and child molesters in Massachusetts vote for Michael Dukakis." Bush establishes Team 100, which will eventually grow to 249 individuals who contribute nearly $25 million in soft money to help the GOP cause. The contributions also apparently help the contributors, various of whom get ambassadorial appointments, legislative favors, and intervention on regulatory and criminal matters. Bush denies knowledge of Noriega's involvement in drug dealing. The Willie Horton ad is aired. Credit for similar tactics is given to campaign guru Lee Atwater, whose PR firm had represented drug- connected Bahamian prime minister Oscar Pinding and the Philippines' Marcos. Atwater himself had represented UNITA, the CIA-backed Africa rebel group. Fred Malek, ex-Nixon aide, resigns from the Bush campaign after it's revealed that he compiled a list of Jews in the Labor Dept. as part of a Nixon investigation of a "Jewish cabal." A few days before the supposedly surprise arrest of five BCCI officials, some of the world's most powerful drug dealers quietly withdraw millions of dollars from the bank. Some government investigators believe the dealers were tipped off by sources within the Bush administration. Although Felix Rodriguez, former leading cop under Batista, claims he left the CIA in 1976, Rolling Stone reports that he is still going to CIA headquarters monthly to receive assignments and get his bulletproof Cadillac serviced. Bankruptcy judge George Bason Jr. concludes that the government stole Inslaw's software through "trickery, fraud and deceit." Stock market drops 43 points on false rumor that Washington Post was about the publish the Bush-Fitzgerald story. 1989 Bush inaugurated. Aides tell the press that the new administration would rather "stay one step behind than be one step ahead." Bush authorizes CIA support to Noriega's opposition, giving Noriega an excuse to annul Panama's elections. Bush claims executive privilege to avoid testifying in the Oliver North trial, thus becoming first president to use this power to keep his acts as vice president under wraps. Dan Quayle declares changes in Soviet Union "just a public relations extravaganza." Bush brother Prescott flies to Shanghai after the Tiananmen Square massacre to close a deal for an $18 million resort there, despite his brother's ban on high-level Chinese contacts. Prescott says, "We aren't a bunch of carrion birds coming in to pick the carcass. But there are big opportunities in China, and America can't afford to be shut out." Prescott Bush also visits Japan, searching for consulting contracts just ten days before his brother arrives on a presidential tour. The Japanese firm that paid Prescott a quarter-million dollar consulting fee comes under investigation for exchange law violations and links to the Japanese mob. C. Boyden Gray, the president's top ethics official, corrects his 1985 and 1986 financial disclosure forms. He forgot to include $98,000 in income. George Bush signs the S&L bailout bill promising that "these problems will never happen again." The Chicago Tribune reports: "After 14 fishing outings, the President has failed to catch a single fish." At White House behest, the DEA lures drug dealer to Lafayette Park to make arrest in front of presidential home for the benefit of Bush's upcoming drug speech. At first, drug dealer is dubious, asks DEA agent, "Where the fuck is the White House?" Defense secretary nominee John Tower runs into confirmation troubles when it is revealed that he has received hundreds of thousands of dollars in consulting fees from defense contractors. Runs into more trouble with revelations of womanizing and drinking. His nomination is rejected. The sale of three communications satellites to China is announced. Prescott Bush is a $250,000 consultant in the deal. GOP memo is leaked implying that House Speaker Tom Foley is a homosexual. President Bush signs a top-secret directive ordering closer ties with Iraq, which opens the way for $1 billion in new aid just a little more than a year before Bush goes to war against that country. The agricultural credit allows Saddam Hussein to use his hard currency for a massive military buildup. A second judge concurs that the government stole Inslaw's software. The Statistical Abstract of the United States, published by the US government, reports that the GNP of East Germany during the 1980s was greater than that of West Germany. The figures come from the CIA. Bahrain officials suddenly break off offshore drilling negotiations with Amoco and decide to deal with Harken Energy, George Bush Jr.'s firm. Harken has had a series of failed ventures and no cash, so the Bass brothers are brought in to finance Harken's efforts at a cost of $50 million. Neil Bush bails out of JNB Exploration, the firm where he became president with a $100 ante, leaving his partners to worry about its debt. Days earlier he forms Apex Energy with a personal investment of $3000. The rest of the money -- $2.7 million -- comes from an SBA program designed to help "high risk start-up companies." Like JNB, it proves to be just that. Apex will later go belly-up with no assets. Two months after his father's inauguration, George W. Bush announces that he and a syndicate of investors have purchased the Texas Rangers. The investors are Edward "Rusty" Rose, Richard Rainwater, Bill DeWitt, Roland Betts (a former Yale frat brother) and Tom Bernstein (Bett's partner in a film investment concern). While Bush appears to lead the group, Rainwater makes clear that Rose is to control how the business is run. Bush's stake in the $86 million deal is 2%, financed with a $500,000 loan from a Midland Bank of which he had been a director and $106,000 from other sources. Rainwater and Rose put up 14.2 million, Betts and Bernstein invested about $6 million and the balance comes from smaller investors and loans. Bush will eventually sell his share for $15 million. 1990 Federal regulators give Bush son Neil the mildest possible penalty in the $1 billion failure of the Silverado S&L. The deal is so good that Bush drops his appeal. Among other things, Neil, as a Silverado director, voted to approve over $100 million in loans to his business partners. January: Bahrain awards exclusive offshore drilling rights to Harken Oil. This is a surprise as Harken is in very shaky financial condition, has never drilled outside of Texas, Louisiana and Oklahoma and had never drilled undersea at all. The Bass brothers are brought in by Harken for sufficient equity - $25 million - to proceed with the effort. Harvard Management increases its investment. Harken's stock price rises from $4.50 to $5.50. June Harken drills two dry holes in Bahrain. George W. Bush sells two- thirds of his Harken Energy stock at the top of the market for $850,000, a 200% profit, but makes no report to the SEC until March 1991. Bush Jr. says later the SEC misplaced the report. An SEC representative responds: "nobody ever found the 'lost' filing." One week after Bush's sale, Harken reports an earnings plunge. Harken stock falls more than 60%. Bush uses most of the proceeds to pay off the bank loan he had taken a year earlier to finance his portion of the Texas Rangers deal. August: Saddam Hussein invades Kuwait. Harken's stock price drops substantially. Two months after Bush sells his stock, Harken posts losses for the 2nd quarter of well over $20 million and is shares fall another 24 %, by year end Harken is trading at $1.25. Bush has insisted that he did not know about the firm's mounting losses and that his stock sell-off was approved by Harken's general counsel. George W. Bush is asked by Carlyle Group to serve on the board of directors of Caterair, one of the nation's largest airline catering services which it had acquired in 1989. The offer is arranged by Fred Malek, long time Bush associate who is then an advisor to Carlyle. October: Arlington, Texas Mayor Richard Greene signs a contract that guarantees $135 million toward the new Texas Ranger Stadium's estimate price of $190 million. The Rangers put up no cash but finance their share through a ticket surcharge. From the team's operating revenues, the city will earn a maximum of $5 million annually in rent, no matter how much the Rangers reap from ticket sales and television (a sum that will rise to $100 million a year). Another provision permitts the franchise to buy the stadium after the accumulated rental payments reached a mere $ 60 million. The property acquired so cheaply by the Rangers includes not just a fancy new stadium with a seating capacity of 49,000 but an additional 270 acres of newly valuable land. Legislation is passed and signed that authorizes the Arlington Sports Facilities Development Authority with power to issue bonds and exercise eminent domain over any obstinate landowners. Never before had a Texas municipal authority been given the license to seize the property of a private citizen for the benefit of other private citizens. A recalcitrant Arlington family refuses to sell a 13 acre parcel near the stadium site for half its appraised value. The jury awards more than $4 million to the family. Fred Malek returns to power with ambassador status to head up planning for the economic summit. S&L industry is losing money at the rate of $3 million a minute. Bailout chief estimates total cost at $325-500 billion. Some 200 young soccer players have their games canceled for security reasons because Bush wants to go fishing on the Potomac nearby. Says one seven-year-old player: "We had a tough soccer game and he's just going fishing. He could play somewhere else." Bush son Jeb gets the federal government to pay off the $4,5 million he owed to a failed Florida thrift. Jeb pays $500,000. Bush brother Jonathan's east coast brokerage fined in two states for violating laws and Jonathan is barred from public trading in Massachusetts. Bush's attorney general, Richard Thornberg, is warned about BCCI but does nothing. Federal court of appeals throws out the Inslaw case on the grounds that it did not belong in bankruptcy court. Bush says, "The economy is headed in the right direction." 1991 January: President Bush attacks Iraq. February: Dubya, as the official in charge at Harken, reports his stock sale to the SEC - eight months late. April - The SEC begins an investigation into Harken dealings. Chairman Richard Breeden, who was appointed by the senior Bush and served him as an economic policy adviser, hails from Baker & Botts, a big Texas oil law firm where he was a partner. Inside the SEC, James Doty, general counsel and the official in charge of any litigation that might come out of the Harken investigation, is another alumnus of Baker & Botts. And as a private attorney, before joining the government, Doty represented the younger Bush in matters related to Dubya's ownership of the Rangers. Former top aide to White House Chief of Staff John Sununu goes to work for a prominent figure in the BCCI scandal less than a month after leaving the Bush administration. Edward Rogers Jr. signs a $600,000 contract to give legal advice to Sheik Kamal Adham, an ex-Saudi intelligence officer who is being investigated for his role in BCCI's takeover of First American Bancshares. The Miami acting US Attorney is allegedly rebuffed by the Justice Department in his efforts to indict BCCI and some of its principal officers on tax fraud charges. Justice Department later denies this occurred. Danny Casolaro, a reporter investigating the Inslaw story, is found dead in a motel room bathtub, the day after he met a key source. The death was ruled a suicide. Perhaps he is despondent over the loss of his briefcase, which is missing from the room. George Bush spends three nights in a Houston hotel so he can claim Texas residency. Texas has no income tax. Neil Bush bails out of Apex Energy after collecting $320,000 in salary plus expenses. Bill Daniels, cable-TV magnate who has been lobbying against regulation of the cable industry, offers Neil a job. According to a representative, he "thought Neil deserved a second chance." 1992 New York Times reports that three of Bush's top fundraisers are being sued in connection with bank failures and another pleaded guilty to mail fraud in connection with an S&L. These men include the GOP national finance chair, vice chair and two co-chairs of the President's Dinner, which raised $9 million for Republican causes. Former US Attorney General Elliot Richardson, representing the owners of Inslaw, tells Mother Jones, "I don't know any case where the government has stonewalled like this." First of Harken Energy's wells off Bahrain comes up dry. George W. Bush takes a leave of absence from the firm to work in his father's campaign, saying "I don't want to involve this company in any kind of allegations of conflicts or whatever may arise." Village Voice reports that President Bush has taken at least 76 partisan flights during his term, at a cost to the taxpayers of over $6 million. Nixon's Jew hunter Fred Malek is back as Bush's campaign manager. Campaign sells photo opportunities with the president at a fundraiser for $92,000 each. Washington, DC, loses $52,000 in taxes because Bush claims to be a Texas resident. Donald H. Alexander contributes $100,000 to Team 100; shortly thereafter he's named ambassador to the Netherlands. Bush says: "I will do what I have to do to be reelected." JERRY URBAN, HOUSTON CHRONICLE, JUNE 4, 1992: The Financial Crimes Enforcement Network -- known as FinCEN -- and the FBI are reviewing accusations that entrepreneur James R. Bath guided money to Houston from Saudi investors who wanted to influence US policy under the Reagan and Bush administrations, sources close to the investigations say . . . The federal review stems in part from court documents obtained through litigation by Bill White, a former real estate business associate of Bath . . . White became entangled in a series of lawsuits and countersuits with Bath, who for some six years has prevailed in the courts. . . . In sworn depositions, Bath said he represented four prominent Saudis as a trustee and that he would use his name on their investments. In return, he said, he would receive a 5 percent interest in their deals. Tax documents and personal financial records show that Bath personally had a 5 percent interest in Arbusto '79 Ltd., and Arbusto '80 Ltd., limited partnerships controlled by George W. Bush, President Bush's eldest son. Arbusto means 'bush' in Spanish. Bath invested $ 50,000 in the limited partnerships, according to the documents. There is no available evidence to show whether the money came from Saudi interests. George W. Bush's company, Bush Exploration Co., general partner in the limited partnerships, went through several mergers, eventually evolving into Harken Energy Corp., a suburban Dallas-based company . . . Bush said that to his knowledge, Bath's investment was from personal funds, and no Saudi money was invested in Arbusto. Bath, 55, a former U.S. Air Force pilot, declined to comment for the record. Spokesmen for FinCEN and the FBI also declined to comment. According to a 1976 trust agreement, drawn shortly after Bush was appointed director of the Central Intelligence Agency, Saudi Sheik Salem M. Binladen appointed Bath as his business representative in Houston. Binladen, along with his brothers, owns Binladen Brothers Construction, one of the largest construction companies in the Middle East. According to White, Bath told him that he had assisted the CIA in a liaison role with Saudi Arabia since 1976. Bath has previously denied having worked for the CIA . . . Bath received a 5 percent interest in the companies that own and operate Houston Gulf Airport after purchasing it on behalf of Binladen in 1977. 1993 The SEC ends a perfunctory investigastion of Harken. With the new Ranger stadium being readied to open the following spring, George W. Bush announces that he would be running for governor. He is says his campaign theme will be self-reliance and personal responsibility rather than dependence on government. PBS FRONTLINE: [From a French source] The Saudi authorities' decision to issue an arrest warrant for Osama bin Laden on 16 May 1993 does not threaten to affect the relationship between the bin Ladens and the royal family. Osama, one of Mohammed's youngest son, has been known for years for his fundamentalist activities . . . King Fahd's two closest friends were: Prince Mohammed Ben Abdullah (son of Abdul Aziz' youngest brother), who died in the early '80s and whose brother, Khaled Ben Abdullah (an associate of Suleiman Olayan), still has free access to the king; and Salem bin Laden, who died in 1988 . . . Like his father in 1968, Salem died in a 1988 air crash...in Texas. He was flying a BAC 1-11 which had been bought in July 1977 by Prince Mohammed Ben Fahd. The plane's flight plans had long been at the center of a number of investigations. According to one of the plane's American pilots, it had been used in October 1980 during secret Paris meetings between US and Iranian emissaries. Nothing was ever proven, but Salem bin Laden's accidental death revived some speculation that he might have been "eliminated" as an embarrassing witness. In fact, an inquiry was held to determine the exact circumstances of the accident. The conclusions were never divulged . . . There was also a political aspect to Salem bin Laden's financial activities . . . Salem bin Laden played a role in the US operations in the Middle East and Central America during the '80s. On his death in 1968, Sheik Mohammed left behind not only an industrial and financial estate but also a progeny made up of no less than 54 sons and daughters, the fruit of a number of marriages . . . Upon Sheik Salem's death, the leadership of the group passed to his eldest son, Bakr, along with thirteen other brothers who make up the board of the bin Laden group. The most important of these are Hassan,Yeslam and Yehia. Most of these brothers have different mothers and different nationalities as well. Each has his own set of affinities, thus contributing to the group's international scope. Bakr and Yehia are seen as representatives of the "Syrian group"; Yeslam, of the "Lebanese group". There is also a "Jordanian group." Abdul Aziz, one of the youngest brothers, represents the "Egyptian group" and is also manager of the bin Laden group's Egyptian branch, which employs over 40,000 people. Osama bin Laden is, incidentally, the only brother with a Saudi mother. FRONTLINE 1994 George W. Bush is elected Governor of Texas, defeating Ann Richards 53 to 46 %. 1999 George W. Bush celebrates the Martin Luther King holiday by staying inside the Governor's Mansion with the windows closed so he wouldn't hear the thousands of Martin Luther King celebrants listening to speeches right outside his window on the Texas capitol grounds, less than a football field away . . NEWSMAX: Soon-to-be GOP presidential nominee George W. Bush was suspended during his service in the Texas Air National Guard for failing to take a physical that included a drug test, The Sunday Times of London reports . . . "In April 1972 the Pentagon implemented a drug- abuse testing program that required officers on 'extended active duty', including reservists such as Bush, to undergo at least one random drug test every year," reported the Times. "The annual medical exam that year included a routine analysis of urine, a close examination of the nasal cavities and specific questions about drugs." . . . But in May 1972, he took a leave of absence from the Guard to work on the Senate campaign of Winton Blount, a friend of George Bush Sr., then a Texas congressman. Bush Jr. applied for a transfer from Houston to Dannelly Air Force Base in Montgomery, Alabama. But, says the Times, documents show no evidence that once in Alabama, Bush ever attended the required training. Bush's commander for the period in question, Gen. William Turnipseed, now retired, claims the young airman never showed up for regular drills . . . The Texas Governor has been plagued by drug questions since last summer, when he claimed to be drug free for the last 25 years . . . Still, despite a deluge of media speculation over Bush's possible past cocaine use, not a single witness has come forward to say they saw him use the drug. On the other hand, no fewer than six witnesses have claimed in published reports that President Clinton used cocaine. "Some people have too much freedom." -- George W. Bush 2000 "Jeb's the smart one" -- George Bush Sr. to dinner partner Former President George Bush tries to block Gen. Manuel Noriega's release from a US prison because he fears the Panamanian strongman wants to kill him. Noriega attorney Frank Rubino says the assertion was made by Assistant US Attorney Pat Sullivan, who represented the government at a parole hearing for Noriega. * "Please! Don't kill me." -- George W. Bush to Larry King, mocking what Karla Faye Tucker said when asked "What would you say to Governor Bush?" prior to her execution by lethal injection (as reported by Talk magazine, September 1999). PRATAP CHATTERJEE, SAN FRANCISCO BAY GUARDIAN: early last October, every member of a ninth grade girls track team and the freshman the football team at suburban Houston's Deer Park High School's north campus returned from practice reporting severe breathing problems. That day Deer Park registered 251 parts of ozone per billion, more than twice the federal standard, and Houston surpassed Los Angeles as the smoggiest city in the United States. One of the biggest sources of Deer Park's pollution is a plant owned by Enron, Houston's wealthiest company - and the single largest contributor ($555,000 and counting) to the political ambitions of Texas Governor and Republican presidential nominee George W. Bush. Kenneth Lay, the chief executive of Enron, has personally given over $100,000 to Bush's political campaigns, more than any other individual . . . Enron is best known as the largest buyer and seller of natural gas in the country. Its 1999 revenues of $40 billion make it the 18th largest company in the United States . . . Texas activists say that this tight connection between Bush and Lay bodes ill for the country, if Bush is elected. Andrew Wheat, from Texans for Public Justice, a campaign finance advocacy group in Austin, compared the symbiotic relationship between Enron and the Governor to "cogeneration" - a process used by utilities to harness waste heat vented by their generators to produce more power. "In a more sinister form of cogeneration, corporations are converting economic into political power," Wheat explained. http://prorev.com/bush.htmhttp://prorev.com/bush.htmDubya as president FROM THE CAMPAIGN THE BOOK ON BUSH The most startling article yet on George W. Bush comes from none other than Paul Krassner, the Moses of the alternative press, in what he declares to be the next to last issue of the Realist. Krassner claims to have obtained the report of a special consultant hired by the Bush campaign to analyze the findings of a private investigator also employed by Bush to discover what others might reveal about the Republican candidate. Krassner says he got the document from a source high in the Bush campaign. This may sound weird, but it's the sort of thing that politicians actually do these days. The Review has previously reported on an similar investigation apparently ordered by Hillary Clinton for the 1992 campaign (The investigator in that case ended up dead in a gang style slaying). The Bush report is pretty mild stuff compared to the Clinton saga but it does include charges of plagiarism, fraternity hazing, public drunkenness, drunken driving, group sex, cocaine and heroin use, and a woman who claims she and a friend purchased some "bad shit" from Bush, with her friend almost dying as a result. Unlike Clinton's story, there is no mention of murder, suicide, major drug or other criminal racketeering. The dossier was perhaps best summed up by one alleged sexual partner, a Brazilian woman, who said of her sex with Bush: "I could've of done it in my sleep. In fact, I may have." On the other hand, there is nothing in the report that recommends Bush for the presidency. Or for any other job, for that matter. A few excerpts: On charges of public drunkenness including an incident in which W allegedly flew a Coast Guard plane over East Texas in a state of inebriation and started to dive bomb a tower: "One or two stories like this do us no damage. If, however, the public fixes in its mind an image of W as a fall- down puking drunk, that it isn't exactly great. If this does come out, I suggest we admit everything, but explain it all took place when he was 'under the age of 25.'" "There is not question that on several occasions W was stopped by police and released on account of his family." On group sex -- once allegedly over 24 hours: "Clinton paved a broad path here; we should be able to follow him down it without much consequence." "Of more concern are two instances, neither of which were included in the written report (due to sensitivity) where a theesome or foursome may have included another male. One alleged participant says, 'Junior was so far gone in my opinion that he probably doesn't even remember it' . . . Analysis: This is the sort of thing that wouldn't really do any politician outside of San Francisco much good. The path Clinton paved isn't this wide." On a woman who claimed to have gotten drugs from Dubya: "As you know, 'Sarah Andrews' (not her real name) is being held in her family's compound in New England. . . . Analysis: None of this is good, but it seems containable. Sarah is unlikely to talk, especially when she's under house guard." "In casual conversation at the end of our talk, the PI mentioned that he'd done 'three or four' previous reports on other politicians because 'everybody wants to know what the other side will find out." He went on to say that what he'd dug up here 'wasn't much more than what he saw in similar cases.'" CAVEAT: It is possible that, in a preemptive move, Krassner was given the material so the campaign could later lambaste it as coming from a radical publication. It is also possible that some of the information was deliberately planted so it could be disproved later, thereby discrediting the whole story. THE REVIEW LIST Questions the media probably won't ask George W. Bush In 1984, after your firm, Arbusto Energy, had fallen on hard times, you managed to get a job as the 30-something president of Spectrum 7 Energy Corporation, the firm that purchased Arbusto. You also got 14% of the Spectrum's stock. Meanwhile, your 50 investors in Arbusto got paid off at about 20 cents on the dollar. Is this the sort of thing your new economic advisor, Lawrence Lindsey, was thinking of when he said Americans had become too greedy? Or might he have been thinking of the deal in 1986 when, after Spectrum 7 had lost $400,000 in six months, you sold it to Harken Energy, becoming a major Harken stockholder and receiving a good salary as a director and consultant? Or was it that time when you sold two-thirds of your Harken stock for a 200% profit on June 22, 1990, just 40 days before the start of the Gulf War and one week before the company announced a $23 million quarterly loss, setting off a 60% drop in share price over the next six months? Why were you so valuable to these companies given your less than impressive business acumen? When you and your Harken partners ran short of cash and hooked up with investment banker Jackson Stephens of Little Rock, Arkansas, he got you a $25 million stock purchase by Union Bank of Switzerland. Did you know that Sheik Abdullah Bakhsh, who joined your board as a part of the deal, was connected to BCCI? Did you know that the United Bank was connected to BCCI (including its operations in Panama), the Nugan Hand Bank (a notorious CIA-front in Australia), and Ferdinand Marcos? Did you know that it was Jackson Stephens who introduced the players in what would turn out to be the infamous First American- BCCI deal? Why do your think the government of Bahrain chose Harken to drill its offshore wells even though it had never dug overseas or in water before? Why do you think it chose Harken, with no relevant experience, over Amoco, with plenty of it? Did you ever discuss with your dad Harken-Bahrain deal? Did any sheiks or other officials ever express any concern over the failure of Harken to find any oil? Do you think they really cared? Tell us again why you waited almost a year past the legal deadline to file the necessary SEC report on your Harken stock deal. You borrowed $180,000 from Harken at a low rate. Did you ever pay it back or was it included among that $341,000 Harken listed in SEC documents as loaned to executives and later forgiven? You have worked closely with a number of persons with CIA ties. Do you think it is healthy for the country to have three presidents in a row so closely connected with this intelligence agency? Do you think it is healthy for the country to have three presidents in a row who are Yale men? Your grandfather Prescott was on the board of Brown Harriman which helped provide some of the financing for the Soviet and Nazi regimes. Do you think this was a wise idea? As president would you continue this tradition in our policy towards China? During World War II your grandfather had property seized under the Trading with Enemy Act. Was he pro-Nazi or just a proto-neo- capitalist ahead of his time? What is the American voter to make of the fact that two of your brothers, one father, one grandfather, and one uncle have been involved in unseemly scandals of one sort or another? How do you distinguish your ethical code from theirs? One of your Uncle Prescott's hot deals resulted in an early but major transfer of sensitive technology to the Chinese government. Your father in 1989 lifted sanctions that blocked such ventures. Do you approve of Uncle Prescott and your father's behavior in these matters? As president would you allow such deals to continue? Do you approve of your uncle and father's role in what has become to be known as the "October Surprise?" You invested $600,000 in the Texas Rangers and later sold out for $15 million. What did you do for the Rangers in between? How much of this profit reflected your ability to get the city of Arlington to condemn land for a ball park at 1/6 its true worth and then impose a 1/2 cent sales tax to subsidize your business? Is this an example of what you meant in 1993 when you said, "The best way to allocate resources in our society is through the marketplace. Not through a governing elite?" Can you name a business deal you have been in that hasn't raised ethical questions? That has made a profit without some form of government subsidy? Why did you have to hire private investigators to find out what dirt private investigators might be able to dig up on you? Do you think that you have used more or less cocaine than, say, Marion Barry or Bill Clinton? Discuss this remark by Michael King in the Texas Observer: "Although by his own admission George W. was an indifferent student, he was nevertheless the deserving-by-both beneficiary of the oldest most illegitimate, and most sacrosanct form of affirmative action. . . It's business as usual." Since you want to help "instill individual responsibility" and give people a "future of opportunity, instead of dependence on government," why did you and your neighbors at the exclusive Rainbo Club development get a tax break from your government? In what ways do such tax breaks differ from welfare benefits other than that welfare recipients are more needy? Do you believe that being a member of a secret society dedicated to promoting fraternal nepotism in public office is consistent with being president of a democracy? If the words "skull and bones" are mentioned at a White House news conference, will you -- as the tradition of the society demands -- feel compelled to leave the room? BUSH'S RUNNING MATE VEEP STAKE Richard Cheney and Joe Lieberman are two of the most curious choices for vice president of recent times. While commentators have come up with a number of contorted explanations, the most obvious one is being ignored: Cheney and Lieberman's real constituency is not a collection of voters but the defense industry, which they can be expected to serve as faithfully as they have in the past. Lieberman comes from the land of the Sikorsky helicopters and told Connecticut voters as recently as last October that "In my view, one layoff is one too many because each and every worker represents the very heart and soul of our national defense." Selecting a couple of reliable Pentagon pimps is important at this time for reasons not widely reported: there is strong bipartisan support for a planned massive increase in defense spending. The build-up would raise the size of the Pentagon budget relative to GDP by about 50%. This is not a secret plan. For example, Defense Daily reported on August 16 that the Marine Commandant, General James Jones, was talking about going from "about 2.9 percent through a gradual ramp-up to about 4 and 4.5 percent of the US Gross Domestic Product. And the Washington Post said: "The nation's military leaders say they will loyally obey the president's marching orders until the moment he leaves office in January. But when it comes to money matters, they already are targeting the next administration." Just in the short term, the increases sought are "equal to almost the entire budget for the Education Department." Said a civilian Pentagon official, "the service requests have been unrestrained." Writes the Post: "'We're going for the big money,' said an officer on the staff of the Joint Chiefs, adding that his bosses are 'a little bit like kids in the candy store.'" The military especially likes Bush but won't be disappointed with Gore who told the Veterans of Foreign Wars a few years ago: "It is the Republican Congress themselves that would cut defense at the turn of the century to try to make their numbers fit together. Again, look beyond the rhetoric and look at the facts. Let me repeat. It is the Republican defense budget, not President Clinton's, that drops in the next century. President Clinton's budget, which is also there for your to see, does not. It increases." *** PUBLIC I: Under the guidance of Richard Cheney, a get-the-government- out-of-my-face conservative, Halliburton Company over the past five years has emerged as a corporate welfare hog, benefiting from at least $3.8 billion in federal contracts and taxpayer-insured loans. One of these loans was approved in April by the US Export-Import Bank. It guaranteed $489 million in credits to a Russian oil company whose roots are imbedded in a legacy of KGB and Communist Party corruption, as well as drug trafficking and organized crime funds, according to Russian and US sources and documents. Those claims are hotly disputed by the Russian oil firm's holding company . . . If Halliburton has benefited from government generosity, it also has reciprocated with substantial political contributions, largely to Republicans. During Cheney's five years at the helm, the company has donated $1,212,000 in soft and hard money to candidates and parties, according to numbers compiled by the non-partisan Center for Responsive Politics. In the five years prior to his arrival, the company had given $534,750. THE DALLAS MORNING NEWS reports that GOP vice presidential candidate Dick Cheney failed to vote in 14 of 16 elections since moving to Texas in 1995. Cheney's Democratic rival for the vice presidency, Sen. Joe Lieberman of Connecticut, has a five-for-six rate of election participation over the same period according to the paper. 1987 was a big year in the Reagan administration. The Iran-Contra chickens were coming home to roost. The previous December, CIA director William Casey had developed a brain tumor and lost his ability to speak. In February 1987 he resigned and died soon afterwards. That same month, former National Security Director Robert McFarlane tried to commit suicide. Also in February, the Tower Commission laid the blame on White House chief of staff Donald Regan for the "chaos that descended upon the White House" in the Iran-Contra affair. The commission praised Bush for his "vigorous reaffirmation of US opposition to terrorism in all forms" Regan was forced to resign.In November a joint congressional investigation of Iran Contra issued a bland report that cleared Vice President Bush. Key to the exculpation was senior House Republican member Richard Cheney. When he became president Bush appointed Tower as Defense Secretary and fellow Tower Commission member Brent Scowcroft as national security adviser. The Senate refused to confirm Tower and Bush named the loyal Cheney in his stead. Cheney's voting record was slightly more conservative than mine -- Newt Gingrich. In 10 years in the House, [Dick Cheney]... chocked up a conservative voting record that rivaled Senator Jesse Helms's. -- Business Week GREG PIERCE, WASHINGTON TIMES: As secretary of defense, Richard B. Cheney entertained major Republican contributors at private meetings at the Pentagon, the Associated Press reports, citing documents gathered by congressional fund-raising investigators. Mr. Cheney was host for at least two GOP donor gatherings inside the Defense Department in 1991 and in 1992, the records show. "If he's having an open house for contributors at the Pentagon, it does bring back reminiscences of the Lincoln Bedroom," said Larry Makinson, executive director of the Center for Responsive Politics . . . On Aug. 19, 1992, members of the Presidential Roundtable (minimum donation $5,000) attended a briefing with Mr. Cheney . . . A Republican National Committee brochure that touted the benefits of joining the Presidential Roundtable included a picture of Mr. Cheney briefing members at the Pentagon. SAM SMITH, "WHOSE WAR IS IT?," TPR 1992: George Bush's behavior in [the Iraq] affair is bizarre even by presidential standards, let alone constitutional ones. He has barely consulted the joint chiefs of staff while making a commitment of American troops close to that in Vietnam. When Defense Secretary Cheney made a televised announcement that the US might be sending more troops to Saudi Arabia, Gen. Colin Powell learned of it while on his way back from the Middle East. And the president has clearly not consulted Congress. The question inevitably arises: whose war is this going to be? Sununu's? Cheney's? Millie's? Some of the speculation has bordered on the grotesque. The emir of conventional journalism, David Broder, wrote on November 18: "It is almost impossible to imagine a more serious, calm, cautious, rational and prudent set of people than those the president has assembled." The New York Times's R. W. Apple Jr., who got off to a bad start in August characterizing Bush as "tough" and "statesmanlike," had recovered enough by December to write: "Right from the start, foreign policy professionals have complained that Mr. Bush, something of a foreign policy professional himself, has drawn the circle too tight, limiting discussions of really important positions to himself, Secretary of State James A. Baker 3rd, Defense Secretary Dick Cheney and Brent Scowcroft, his national security advisor." One foreign editor on the case described the vision of the White House as being as though looking through a "rifle sight." There is no apparent consideration of long-term effects, cultural factors, the links with other regional issues or history. I suspect that for George Bush, invading Iraq would not really be a war at all, but as with Noriega, more of a personal match -- tennis by other means. An old preppie treating the whole world as his country club. TPR, FEBRUARY 1992: Extra! reports that People magazine's Dirk Mathison made three surreptitious visits [to Bohemian Grove] last July, aided by members of the Bohemian Grove Action Network. Among the activities he witnessed was a speech by former Navy Secretary John Lehman, who said the Pentagon estimated that 200,000 Iraqis were killed in the recent war. Other policy addresses were by Richard Cheney, Joseph Califano, and Elliott Richardson. Mathesin, however, was recognized by an official of Time Warner (People's owner), who made him leave. Mathesin had plenty of material and turned in a story, but after an initially enthusiastic response, the piece was killed, just as early stories on the Grove for NPR and Time had been scotched. THE LIST State rankings of Texas under George Bush - Teacher salaries at beginning of 1st term , 36 - Teacher salaries at beginning of 2nd term, 38 - Teacher salaries plus benefits, 50 - High school completion rate, 48 - SAT scores - 1996 combined math & verbal: 995, 44 - SAT scores - 1998 combined math & verbal: 995, 44 - Highest % of children without health insurance, 1 - Highest % of poor working parents without insurance, 1 - Highest % of population without health insurance, 2 - Highest number of people stripped of Medicare benefits, 1 - Highest teen birth rate, 5 - Per capita funding for public health, 48 - Delivery of social services, 47 - Mothers receiving prenatal care, 45 - Child support collections, 45 - Number of executions, 1 - Teen smoking - down nationally, flat in Texas, - Teen drug use - down nationally, up 30% in Texas - Pollution released by manufacturing plants, 1 - Greenhouse gas emissions, 1 - Spending for parks and recreation, 48 - Spending for the arts, 48 - Public libraries and branches, 46 - Spending for the environment, 49 - Best place to raise children, 48 - Home ownership, 44 - Highest homes insurance rates in the nation, 1 - Spending for police protection, 47 BILLIONAIRES FOR BUSH (OR GORE) Similarities between the candidates: - Father was a powerful Washington insider - Opposes raising the minimum wage to match the cost of living - Supports corporate-managed trade: (NAFTA, WTO & IMF) - Favored repeal of federal guarantee of assistance to poor children - Got rich in a business subsidized by taxpayers Bush: oil & gas, baseball stadiums; Gore: agribusiness - Supports Federal Reserve policy of keeping wages low to prop up stock prices - Will continue taxpayer subsidies of generous CEO salaries - Supports tens of billions of dollars in corporate subsidies - Will continue to tax earnings from stock market at lower rate than income from actual work - Supports repeal of Depression-era banking regulations designed to protect small depositors - Raised record amounts of campaign cash from wealthy corporate donors - Same color and gender as every other President - In the richest 5% of population - Mediocre golfer - 66 corporations have given to both Bush and Gore FEELING BUSH'S PAIN [The web site, GWBush.com, has obtained a number of letters from inmates imprisoned on drug charges that compare their "youthful indiscretions" with those of Dubya. Here's one] Boy, do I feel your pain. Why are people always dredging up what you did a decade, even two or three decades ago? After all, Henry Hyde and Bob Livingston were still enjoying "youthful indiscretions" at our age! And what about those in Congress who "experimented" with drugs? (You and I just abused them!). Hell, the same drugs they "experimented" with, they're mandating 10 and 20, even life sentences for first time, non-violent experimenters -- far more than for bank robbery and rape. If (select) drugs are worthy of such irrational sentences, why can't people avoid responsibility for "lesser" offenses, say, "experimenting" with bank robbery, or "experimenting" with rape? Nah, this drug thing they're hanging on you isn't right. Like you say, it's time to "forgive and forget." I noticed the press you are getting for being coked up at your Dad's inauguration. Strictly your business I figure. Besides, drinking heavy like you did, a pinch of Peruvian marching powder can really help titrate that buzz. It's like Oreos and milk, isn't it? I've been there. But can I give you some advice? Switch to pot. That disco dust and alcohol can make you mean, while pot mellows you out - you know what I mean. Besides, it makes you a hell of a lot more "compassionate." You ain't itchin' to pull the trigger on every execution that comes across your desk (especially the 14 year olds you pushed to be able to fry)! Speaking of forgetting, I've been rotting in federal prison for years now. The only one who hasn't forgotten me is my federal prosecutor. Don't get me wrong, I sort of like Paul (I call him Paul; he calls me scumbag druggie). He's like a pit bull you can't help but grow fond of, even though he'd be a lot happier, I'll bet, if he "experimented" like you and me. Come to think of it, being forgotten isn't all that great. Your wife, your dog, and especially the message it sends to the kids. Forgiving though, that's more in line with the "compassionate" thing you are pushing. I like the "responsibility" thing too. Yes George (can I call you George?; we're so alike I feel we could be friends) it's time to accept responsibility for your actions, then to forget, then forgive. Just like you say. -- Kevin McHall Reg. No. 05689-052 PO Box 9000 Seagoville, Texas 75159-9000 GREAT MOMENTS OF THE BUSH CAMPAIGN DAVID LETTERMAN: How do you look so youthful and rested? GEORGE W. BUSH: Fake it. DAVID LETTERMAN: And that's pretty much how you're going to run the country? *** DAVID LETTERMAN: Let me remind you of one thing, governor: the road to Washington runs through me. GEORGE W. BUSH: It's about time you had the heart to invite me. [Boos] DAVID LETTERMAN: You're winning delegates left and right, governor. *** DAVID LETTERMAN: You often say: I'm a uniter, not a divider. What does that mean? GEORGE W. BUSH: It means when it comes time to sew up your chest cavity, we use stitches as opposed to opening it up. [Boos] WHY GROWN UP MEN ACT THE WAY THEY DO [The following, while not providing information new to TPR readers, represents something of a break-through in the mainstream press, which (with a few exceptions such as Esquire) has treated Yale's hyper-powerful and bizarre fraternity as if it was also a member of Skull & Bones] STEPHEN PROTEHRO, SALON: Though a seniors-only society, Skull and Bones is more than a tad sophomoric. Each May on "Tap Day," senior Bonesmen troll around Yale's campus, selecting, or "tapping," 15 juniors for membership in the upcoming class. The initiation rites that follow sound like something out of Fred Flintstone's Water Buffalo Lodge or a Robert Bly retreat. Each knight, as neophytes are called, reportedly regales his fellow initiates with his sexual exploits. (He may or may not be naked and may or may not be lying in a coffin.) During initiation, he endures some sort of physical challenge (mud wrestling? diving into a dung pile?) before being born again with a new name and a new identity. In the outside world, members are never to speak about their society. If outsiders raise the topic, Bonesmen are supposed to leave the room. Members take their secrecy oath seriously -- no insider has ever published an exposé -- so it is impossible to separate the realities from the rumors that swirl around the society. One rumor has each new member receiving a $15,000 payout. Another says the interior of the "Tomb" (the eerie Gothic headquarters where twice-a-week meetings are held) is decorated with human remains, including the skulls and bones of notables such as Mexican revolutionary Pancho Villa and Apache warrior Geronimo. -- SALON BUSH AT LARGE "The lessons learned are is that the United States must not retreat within our borders. That we must promote the peace. In order promote the peace we've got to have strong alliances--alliances in Europe, alliances in the Far East. In order promote the peace, I believe we ought to be a free-trading nation. ... The lessons of Acheson and Marshall are is that our nation's greatest export to the world has been, is, and always will be the incredible freedoms we understand in the great land called America."-- George W. Bush I asked [Bush] about the efforts of Southern Baptists to convert Jews, and he responded: "I mean, that's the Southern Baptists. But I don't think that this is a government function." --Franklin Foer "When Forbes pushed [Bush] to explain how, precisely, his administration would respond to rising oil costs, Bush fell apart. His answer: "We'd keep plans in place to say to our drillers, 'Keep on exploring.' -- Tucker Carlson THE REVIEW LIST Books the George Bush campaign claims its candidate has been reading while running for president -- "Acheson: The Secretary of State Who Created the American World," by James Chace. 512 pages. -- A biography of John D. Rockefeller. 774 pages. -- A book on Chinese-American relations. 476 pages. -- Total pages of books Bush is said to be reading: 1,762 "Sitting down and reading a 500-page book on public policy or philosophy or something." -- George W. Bush when asked to name something he isn't good at (Talk magazine, September 1999). THE REVIEW LIST Nicknames Given George W. Bush W. II Two Too Guv G.W. G-Dub G-Bub Shrub Dubya Junior Bushie Guv-Dub Bushbush George II George Two George Too Boy George King George http://www.eskimo.com/~recall/bleed/calmast.htm OPERATION http://www.eskimo.com/~recall/bleed/calmast.htm JUST BECAUSE The Progressive Review Archives OCTOBER 2002 JOHN LINDH GETS 20 YEARS; OIL BARONS WHO CONSORTED WITH TALIBAN STILL FREE WORLD SOCIALIST WEB SITE - At the sentencing hearing, [John] Lindh tearfully read a prepared apology recounting how he wound up as a Taliban soldier after going first to Yemen to study Arabic and then to Pakistan to attend an Islamic school. He said he arrived in Afghanistan on September 6, 2001 and decided to join the Taliban after hearing reports of "numerous atrocities committed by the Northern Alliance against civilians ... massacres, child rape, torture and castration." Lindh alluded to how he was caught in the shifting tides of US geopolitical interests. "I saw the war between the Taliban and the Northern Alliance as a continuation of the war between the mujahedin and the Soviets. I knew that the mujahedin had been supported by the United States. In addition, I knew that the Northern Alliance continued to be funded and armed by the Russian government throughout the 1990s and up until last year," Lindh continued. . . Lindh concluded, "I went to Afghanistan with the intention of fighting against terrorism and oppression, not to support it.". . . [Defense counsel George Harris] added that there was concern that a public trial would disclose the US government's own ties to the Taliban if Lindh argued that he was being subjected to selective prosecution. "Our research showed that the US government made substantial payments to the Taliban in 2001, during the months leading up to September 11 - the last payment was $43 million in June - for opium poppy eradication, which the Taliban did fairly successfully," he said. "Now, according to reports, that situation has changed dramatically. In addition, there was evidence that the US was supporting the efforts of Unocal to cooperate with the Taliban to build a natural gas pipeline through Afghanistan. Meetings were being held for that purpose right up to September 11. There was also a telephone company interested in Afghanistan. John Lindh was the only person prosecuted for providing services to the Taliban, however." BBC, December 1987 - A senior delegation from the Taleban movement in Afghanistan is in the United States for talks with an international energy company that wants to construct a gas pipeline from Turkmenistan across Afghanistan to Pakistan. A spokesman for the company, Unocal, said the Taleban were expected to spend several days at the company's headquarters in Sugarland, Texas. Unocal says it has agreements both with Turkmenistan to sell its gas and with Pakistan to buy it. The Afghan economy has been devastated by 20 years of civil war But, despite the civil war in Afghanistan, Unocal has been in competition with an Argentinean firm, Bridas, to actually construct the pipeline. Last month, the Argentinean firm, Bridas, announced that it was close to signing a two-billion dollar deal to build the pipeline, which would carry gas 1,300 kilometers from Turkmenistan to Pakistan, across Afghanistan. In May, Taleban-controlled radio in Kabul said a visiting delegation from an Argentinean company had announced that pipeline construction would start "soon". SEPTEMBER 2002 VERNON LOEB, WASHINGTON POST - A new study by the Army's Center of Military History has found that the U.S. military would have to commit 300,000 peacekeeping troops in Afghanistan and 100,000 in Iraq if it were to occupy and reconstruct those nations on the scale that occurred in Japan and Germany after World War II. The study was requested by the Army's director of transformation in May as part of a force structure review undertaken in light of significant new troop demands in Afghanistan, ongoing commitments in the Balkans and potential peacekeeping duties in Iraq. Although no one inside or outside the Pentagon is proposing anything close to post-World War II occupation forces in either Afghanistan or Iraq, Army officers say the study underscores the extent of new long-term force commitments the United States could be required to make. JAMES LAXER, TORONTO GLOBE & MAIL - Make note of Sept. 20, 2002. Historians will surely mark it as a seminal moment in our new century. On that date, an old debate ended and a new one began. For the past decade, analysts have been debating the question of whether the United States would follow the course of former powerful states such as Britain and Rome and proclaim itself an empire. In George W. Bush's National Security Strategy, submitted to the U.S. Congress on Sept. 20, the White House espouses a doctrine that is explicitly imperialist. The document envisions a world in which the United States will enjoy permanent military dominance over all countries, allies and potential foes alike. Indeed, in its sweeping declaration that the U.S. "has no intention of allowing any foreign power to catch up with the huge lead the United States has opened since the fall of the Soviet Union," the distinction between friends and foes becomes much less important than it was in the past. The United States now spends as much on its military as all the other countries in the world combined spend on their militaries. According to the Bush document, the U.S. military will "be strong enough" to dissuade any potential challenger from "pursuing a military buildup in hopes of surpassing, or equaling, the power of the United States." The meaning of the doctrine is clear. It dashes the aspirations of those who had hoped that the world was moving toward a system of international law that would allow for the peaceful resolution of conflicts, through covenants and courts. In place of this, a single power that shuns covenants and courts has proclaimed that it intends to dominate the world militarily, intervening preemptively where necessary to exorcise threats. . . Those who want a world in which no power is supreme and which laws and covenants are used to settle conflicts will begin a new debate -- about how to contend with imperial America. ARUNDHATI ROY - What does the term "anti-American" mean? Does it mean you are anti- jazz? Or that you're opposed to freedom of speech? That you don't delight in Toni Morrison or John Updike? That you have a quarrel with giant sequoias? Does it mean that you don't admire the hundreds of thousands of American citizens who marched against nuclear weapons, or the thousands of war resisters who forced their government to withdraw from Vietnam? Does it mean that you hate all Americans? This sly conflation of America's culture, music, literature, the breathtaking physical beauty of the land, the ordinary pleasures of ordinary people with criticism of the U.S. government's foreign policy (about which, thanks to America's "free press", sadly most Americans know very little) is a deliberate and extremely effective strategy. It's like a retreating army taking cover in a heavily populated city, hoping that the prospect of hitting civilian targets will deter enemy fire. . . WHILE THOUSANDS OF AMERICANS gathered in Washington to protest peacefully, JC Penney and other stores were selling this: "Forward Command Post $44.99 Take command of your soldiers from this fully outfitted battle zone. 75-piece set includes one 111/2"H figurine in military combat gear, toy weapons, American flag, chairs and more. Assembled dimensions; 32x16x32"H. Plastic. 10 lbs. Ages 5 and up. Notes the Antiwar site: "We have also located similar products at two online toy stores, eToys and KB Toys. Both companies are owned by KB Holdings, 2833 S. Jones Blvd., Suite 8, Las Vegas, NV 88102. Phone number 303-228-9000, fax number 303-226-8600" http://yorick.infinitejest.org:81/1/cards.htmlhttp://yorick.infinitejest.org:81/1/cards.html AMERICAN TRADING CARDS MINUTES OF SILENCE KARACHIAN, DAWN, PAKISTAN - A friend sent in this email that she got from someone in America who's originally from Karachi. It's self-explanatory. It goes like this: "If you are still shaken by the horrifying scenes of September 11, please observe a moment of silence for the 3,000 civilian lives lost in the attacks. "While we're at it, let's have 13 minutes of silence for the 130,000 Iraqi civilians killed in 1991 by order of President Bush Sr. Take another moment to remember how Americans celebrated and cheered in the streets. "Now another 20 minutes of silence for the 200,000 Iranians killed by Iraqi soldiers using weapons and money provided to young Saddam Hussein by the American government before the great eagle turned all its power against Iraq. "Another 15 minutes of silence for the Russians and 150,000 Afghan civilians killed by troops supported and trained by the CIA. Plus 10 minutes of silence for 100,000 Japanese killed in Hiroshima and Nagasaki by the Atomic bombs dropped by the US. "We've just kept quiet for one hour: one minute for the Americans killed in NY, DC, and Pennsylvania, 59 minutes for their victims throughout the world. If you are still in awe, let's have another hour of silence for all those killed in Vietnam, which is not something Americans like to admit. "Or for the massacre in Panama in 1989, where American troops attacked poor villagers, leaving 20,000 Panamanians homeless and thousands more dead. Or for the millions of children who have died because of the US embargoes on Iraq and Cuba. "Or the hundreds of thousands brutally murdered throughout the world by US-sponsored civil wars and coups d'etat (Chile, Argentina, Uruguay, Bolivia, Guatemala, El Salvador to name a few). HOMELAND INSANITY BALTIMORE SUN - At the risk of sounding heretical, it's time to pull the plug on the plan to create a Department of Homeland Security. Better yet, drive a stake through its heart. Months of debate have made clear that this bureaucratic boondoggle offers no promise of making the homeland more secure. Worse, it takes the focus off the need for tighter oversight of the nation's security systems. . . . Few lawmakers have openly opposed this sacred cow. The proposal whisked through the House in a matter of hours before the summer recess. It is bogged down in the Senate largely because of a partisan dispute over worker rules. Mr. Bush is taking advantage of the opportunity to mow down longstanding worker rights and protections, saying he needs greater flexibility to hire, fire and move workers around. That alone is a good reason to deep-six this plan. Civil service laws may well need some updating to attract and retain a quality work force. But the changes should be carefully applied throughout the government to avoid creating a class system in which workers at some agencies are treated better than those at others. REPORTERS COMMITTEE FOR FREEDOM OF THE PRESS - Media aiming to cover this year's Sept. 11 events at Guantanamo Bay, Cuba, faced tightened press limits at the U.S. Naval station, including restroom escorts and restricted interviews. Guantanamo Bay, which includes Camp Delta where nearly 600 suspected terrorists are detained, has upheld a high degree of media management since the detainees began arriving in January, said Miami Herald reporter Carol Rosenberg. But restrictions have become more severe in recent weeks, she noted. In the past, reporters were allowed to speak with people on base in civilian clothes, Rosenberg said. "Now, there's a virtual absolute control over who we talk to and how, and a deep degree of distrust of allowing reporters to talk to people doing their job." The tightened restrictions include monitored interviews with U.S. military personnel, media escorts on the side of the base where the detainees are held including restrooms and vending machines, according to a Sept. 14 report by Paisley Dodds of The Associated Press. Rosenberg said that the 17 reporters and crew who traveled to Guantanamo were told that unauthorized interactions with civilians were not permitted, not even in eating establishments or to ask to which organization they belonged. "Anywhere where you might have any sort of ordinary interaction with anyone on that base you had an escort at your elbow," Rosenberg said. "It was more obtrusive than any other time." DAILY MIRROR, UK - President Bush faced world anger last night over America's seven- nation nuclear hit list. British MPs joined the outcry after a leaked Pentagon report revealed contingency plans to use nuclear weapons against China, Russia, Iran, Iraq, North Korea, Syria and Libya. The secret policy was denounced as warmongering "lunacy." Alarmed officials from Moscow to Tehran warned that the "power crazy" President, buoyed up by the successful campaign in Afghanistan, could plunge the world into chaos. British politicians said the strategy threatened the stability of the NATO alliance . . . The review says the US must be ready to use nuclear weapons against China, Russia, Iran, Iraq, North Korea, Syria and Libya. It then identified four areas where the US should be prepared to press the button: In an Arab-Israeli conflict, in a war between China and Taiwan, in an attack by North Korea on South Korea and in an attack by Iraq on Israel or another neighbor. Additionally, the weapons could be used against targets able to withstand conventional attack and in retaliation for the use of nuclear, biological or chemical weapons. . . . US Secretary of State Colin Powell insisted the report did not signal imminent action. He said: "We should not get carried away with some sense the US plans to use nuclear weapons in some contingency in the near future. "It's not the case. What the Pentagon has done with this is sound military, conceptual planning. "Not a single nation is being targeted by an American nuclear weapon on a day-to-day basis." MICHAEL I. NIMAN, ALTERNET - America got its made-for-television bust of a real al- Qaeda cell right in the American heartland, in Buffalo, New York. News of the Buffalo raid quickly dominated international media, since it was the first-ever bust of any al-Qaeda terrorists on American soil and the first major U.S. terrorism arrest since the September 2001 attacks. . . [Governor] Pataki, who had no role in the investigation, grabbed the limelight, explaining how the five suspects "trained at al-Qaeda camps" and heard Osama bin Laden speak. . . Special Agent Ahearn, standing in front of the cameras with the taller Pataki visibly towering behind him, reported that no weapons were found and that there was no evidence that the suspects were supporting or planning any specific terrorist actions. The entire case against the five Americans consists of the fact that they allegedly, while on a pilgrimage to study Islam in Pakistan, took a side trip into Taliban Afghanistan and visited what later became known in the American media as the "al-Farooq terrorist training camp." The trip allegedly took place before the Sept. 11 attacks and the onset of "the war on terrorism," at a time when it was legal to travel to Afghanistan, when the U.S. was funding Taliban drug eradication efforts and when U.S. oil companies were still hoping to cut a deal with the Taliban to build a trans-Afghanistan pipeline. While the five are charged with "Providing Material Support or Resources to Designated Terrorist Organizations," Ahearn could not be specific as to what sort of resources the men were providing or if there was any further evidence that would be forthcoming. . . If this scant evidence remains as the basis for these terrorism charges, various Americans now may be exposed to similar charges, based on where they might have traveled and whom they might have heard speak. Labor and church activists, for example, who traveled to Sandinista-controlled Nicaragua or FMLN controlled areas of El Salvador in the 1980s, could be charged with similar crimes, especially if they spent money (providing support) while traveling. Similarly, church and community delegations visiting Cuba could find themselves facing similar charges, especially if they took in one of Fidel Castro's epic speeches. Of course, these are not terrorist organizations or nations, but in the eyes of the State Department they were, and in the case of Cuba, they are, supporters of terrorism, true or not. CRIMINAL COMPLAINT WHEN IN DOUBT, KILL AN AFGHAN AND NOT A CANADIAN VERNON LOEB WASHINGTON POST - Two Air Force F-16 pilots have been charged with involuntary manslaughter and assault in the allegedly reckless dropping of a bomb in April on Canadian troops engaged in a live-fire training exercise near Kandahar in southern Afghanistan, the Air Force announced. . . The incident, which killed four Canadian soldiers and wounded eight others, triggered consternation in Canada, where a member of parliament criticized President Bush for not giving an immediate public comment. Bush extended his "heartfelt sympathy" a day later. . . If convicted of all charges, the two could face more than 64 years in prison. Both have been recalled to active duty to face the charges, which were recommended by Air Force Brig. Gen. Stephen T. Sargeant and Canadian Brig. Gen. Marc J. Dumais, who jointly headed the investigation. DURING THE NIGHT of 30 June to 1 July the United States air force bombed the village of Kakrakai, in Uruzgan province, killing 50 and wounding more than 100, most of them women and children attending a wedding. The United Nations sent members of their own mission in Afghanistan to the spot, as well as delegates from the World Health Organization, the High Commissioner for Refugees etc. A first draft report said that no one had fired at the US planes and US investigators were trying to cover up the evidence in the hope that interest in the event would die down. The UN, worried about the repercussions from such a report, decided to request a second "more responsible" version, and not to make it public, but send it to the US and Afghan governments. The UN claimed that its delegates on the spot did not have the military skills to carry out such an investigation. CAMP DELTA RICHARD WALLACE, DAILY MIRROR, UK - Here 598 al-Qaeda and Taliban suspects from 38 countries - including seven Britons - are held without charge, without legal rights and for some, without hope. For 167 of the 168 hours in a week their world is a cramped 8ft x 6ft 8in cell. Their day-to-day existence in a remote corner of the US Naval Base on the south- east of the island is pitiful. The strain of living in such conditions - condemned by human rights groups again last week - has taken a severe toll. The Daily Mirror has learned that more than 30 of the men have attempted suicide. . . US officials also confirmed to us that 37 other detainees are being treated for severe mental health problems. And 18 of those psychiatric cases are so severely traumatized that they are receiving daily treatment and powerful drugs to stave off a variety of symptoms. . . A new Amnesty International report says the detainees are in legal limbo and face a serious breach of their human rights. They are routinely denied the right to see lawyers, although they could face trial by special US military courts with power to pass death sentences. The Mirror quizzed guards, doctors, nurses and military officials during a heavily-escorted three-day visit. Our every move was monitored. And it was difficult to get any information, either on or off the record. But despite the tight restrictions the Mirror has pieced together the most accurate picture yet of life for the detainees. And it's not pretty. . . Delta, surrounded by thick green netting to keep out prying eyes, is brightly lit by powerful arc lights 24 hours a day and the camp is ringed with seven wooden guard towers manned by sharpshooters. There are regular incidents when some prisoners go stir crazy, shouting and screaming as they climb and claw their cell walls in despair. But most of the time there is an eerie, pathetic silence. On our two visits to the camp there wasn't a sound and it was hard to believe there was any life behind the wire at all. . . The 30 who have tried to end their lives have taken desperate and pathetic measures. A few have used the plastic utensils issued with their meals to try and slash their wrists. Some repeatedly banged their heads against the metal wall in their cells or punched the walls in frustration. . . . Disgracefully, yet just within the guidelines of the Geneva Convention, they are allowed only two 15-minute showers a week when they are also given a freshly laundered orange two-piece prison suit. . . The ultimate punishment is The Cooler, a metal box which is air- conditioned and lit, with just enough room for the offender to move around in. DAVID LJUNGGREN, REUTERS - Canadian Prime Minister Jean Chretien has linked the Sept. 11 suicide attacks to the perceived arrogance and selfishness of the United States and the West. Chretien is the first leader of a western major nation to suggest that the suicide hijackers might have been motivated by what he describes as the misguided policies of a rich and powerful West that did not understand the need for restraint. The veteran prime minister, who has been in power for nine years, told the CBC in an interview that there was "a lot of resentment" about the way in which powerful nations treated the increasing number of poor and dispossessed people in the world. "You know, you cannot exercise your powers to the point of humiliation for others. That is what the Western world -- not only the Americans, the Western world -- has to realize. Because they (the have-nots) are human beings too. . . And I do think the Western world is getting too rich in relation to the poor world and necessarily, you know, we're looked upon as being arrogant, self-satisfied greedy and with no limits. And Sept. 11 is an occasion for me to realize it even more." . . . Chretien comes from the moderate left of Canada's ruling Liberal Party, which has sometimes looked upon Republican administrations with suspicion. Canadian Transport Minister David Collenette -- also on the left of the party -- went further in an interview with the CBC that was broadcast in the same Sept. 11 package as the prime minister's. He likened some leading players in the United States to bullies on an ice hockey rink. . . . Chretien's reflective comments were highly unusual for a man known as a down-to- earth politician with little time for the deeper philosophy of governance. The one skill the West and the United States seemed to lack was that of knowing when to exercise some restraint, he said. "It's always the problem when you read history -- (no one) knows when to stop. There's a moment, you know, when you have to stop," he told the CBC, saying he had made this point to a group of Wall Street executives unhappy that Canada had full diplomatic relations with arch U.S. foe Cuba. "And I said that day...'When you're (as) powerful (as) you are, you guys, it's the time to be nice'." DUNCAN CAMPBELL, GUARDIAN, LONDON - Relatives of the victims of the September 11 attacks brought a packed Baptist church to its feet in downtown Los Angeles on the eve of the anniversary, with calls against a war on Iraq. The meeting was one of many addressed by relatives of those who died but who are opposed to military action in retaliation. The occasion at the First Baptist church was advertised as 'A Gathering for Civil Liberties and Peaceful Tomorrows' and as a way of remembering those who had been killed. Its organizers said they hoped it would be a forerunner of many others aimed at stopping a war in Iraq and addressing the issue of civil liberties. Kelly Campbell, the sister-in-law of Craig Amundson, who was killed in the Pentagon, and Craig's brother, Barry, are one of 40 sets of relatives involved in the organization, September 11 Families for Peaceful Tomorrows. The title is taken from Martin Luther King's saying that "wars are poor chisels for peaceful tomorrows". Both told the gathering they did not believe that a war was a suitable memorial for the dead. PETER FORD, CHRISTIAN SCIENCE MONITOR - Ronald McDonald, either as the most reliable purveyor of modestly priced meals or as standard-bearer for American junk-food imperialism, isn't making a big deal out of being American when he's abroad. Indeed, since Sept. 11, some foreign franchise holders have been making a big deal out of not being American. Some stores in Lebanon, Egypt, and elsewhere in the Middle East have been hit by consumer boycotts over US policies. When the US bombing raids started over Afghanistan, Bambang Rachmadi put big green signs in front of his 85 McDonald's restaurants in Indonesia proclaiming their Muslim ownership, and piped in Arabic Muzak. At the Yogyakarta branch, a raised area with low tables is reserved for patrons who want to take off their shoes and eat sprawled on mats, in the traditional style of central Java. There they can choose a burger and fries or a "Rice Package," combining fried chicken, scrambled eggs, and rice. Dispensers pump out not ketchup, but the ubiquitous Indonesian chili sauce called "sambal." In France, you can have your McDonald's cheeseburger made with Roquefort. In Turkey, customers order double kofte burgers, made with meat patties containing onions and flavored with Turkish spices. In China, the Big Mac is still two all-beef patties on a sesame seed bun. But its known as a "ju wu ba," which means "Great Imperial Warlord." CLARE NULLIS ASSOCIATED PRESS - Departing U.N. human rights chief Mary Robinson, in a bleak assessment of the state of human rights, accused governments of hiding behind the ongoing war on terrorism to trample civil liberties and crush troublesome opponents. "Suddenly the T-word is used all the time," Robinson said, referring to terrorism. "And that's the problem." The United States, Russia and China were among the nations she said were ignoring civil rights in the name of combating international terrorist groups. "Everything is justified by that T-word," the 58-year-old former Irish president said in an interview with The Associated Press. "I hope that countries will put human rights back on the agenda because it tended to slip after September 11." BEST NAME FOR BUSH'S WAR: OPERATION JUST BECAUSE PHILIP SHENON, SIDNEY MORNING HERALD - The ignorance and ineptitude of FBI supervisors and lawyers in Washington obstructed agents all over America from pursuing evidence that could have provided them in advance with a "veritable blueprint" of the September 11 attacks, a Senate report has found. The report by the Senate Judiciary Committee, which is expected to be made public next month, is the result of an investigation that began shortly after the terrorist attacks. It focuses on the mishandling of the case against Zacarias Moussaoui, the only person charged with involvement in the September 11 attacks. Though the blundering mishandling of his case was particularly deplorable, it may be indicative of the FBI's bungling of other sensitive counter-terrorism cases before September 11, the report suggests. In the Moussaoui case, the report found, FBI counter-terrorism specialists and the bureau's lawyers were so ignorant of federal surveillance laws that they did not understand that they had ample evidence to press for a warrant to search Moussaoui's belongings. Instead, they aggressively blocked the search warrant sought by desperate field agents, who believed last August that they might have found a terrorist who might use a commercial airplane as a weapon. STACY HUMES-SCHULZ, FINANCIAL TIMES - A majority of Europeans think that US foreign policy is partially to blame for the September 11 terrorist attacks on New York and Washington. A survey of American and European attitudes towards foreign relations found that 55 per cent of respondents from six European countries agreed that US policy had contributed to the attacks. The poll also found widespread public support within the US for an invasion of Iraq, with 75 per cent of American respondents in favor of using military force to overthrow Saddam Hussein and incite regime change. But both European and American respondents were cautious about the US entering Iraq alone, with 65 per cent of Americans and 60 per cent of Europeans urging the US to gain allied support and approval from the United Nations. A mere 10 per cent of Europeans would support US military action in Iraq without backing from the UN and allies. The survey of 9,000 Europeans and Americans was jointly undertaken by the Chicago Council on Foreign Relations and the German Marshall Fund of the United States. PREVIOUSLY UNPUBLISHED PHOTOS OF BUSH ON SEPTEMBER 11 KATE CLARK, INDEPENDENT, LONDON - Weeks before the terrorist attacks on 11 September, the United States and the United Nations ignored warnings from a secret Taliban emissary that Osama bin Laden was planning a huge attack on American soil. The warnings were delivered by an aide of Wakil Ahmed Muttawakil, the Taliban Foreign Minister at the time, who was known to be deeply unhappy with the foreign militants in Afghanistan, including Arabs. Mr Muttawakil, now in American custody, believed the Taliban's protection of Mr bin Laden and the other al-Qa'ida militants would lead to nothing less than the destruction of Afghanistan by the US military. He told his aide: "The guests are going to destroy the guesthouse." The minister then ordered him to alert the US and the UN about what was going to happen. But in a massive failure of intelligence, the message was disregarded because of what sources describe as "warning fatigue". At the same time, the FBI and the CIA failed to take seriously warnings that Islamic fundamentalist students had enrolled in flight schools across the US. . . The emissary went first to the Americans, traveling across the border to meet the consul general, David Katz, in the Pakistani border town of Peshawar, in the third week of July 2001. They met in a safe house belonging to an old mujahedin leader who has confirmed to The Independent that the meeting took place. Another US official was also present &SHY; possibly from the intelligence services. Mr Katz, who now works at the American embassy in Eritrea, declined to talk about the meeting. But other US sources said the warning was not passed on. JOSEPH FARAH, WORLDNET DAILY - An al-Qaida training videotape, captured in Afghanistan, shows Osama bin Laden's terrorists are not only planning attacks with weapons of mass destruction but are preparing to kill Americans with drive-by shootings and home break-ins, through ambushes of law-enforcement officers and targeted assassinations on golf courses, Worldnet Daily has learned. The videotape was produced, U.S. analysts believe, for al-Qaida's internal use and did not appear to be an external propaganda device. . . "None of these training scenarios depicts the type of fighting that al-Qaida engages in within Afghanistan," noted one intelligence expert who saw the tape. The training video shows al- Qaida operatives practicing the following kinds of assaults: Using pickup trucks with shooters concealed in the bed of the trucks; using motorcycles as a shooting platform for drive-bys and assassinations; execution of prisoners; ambushes of law-enforcement officers; residential assassinations; assassination on a golf course using a rocket-propelled grenade and rifle fire; drive-up kidnapping of target walking on a street; use of tunnels, storm drains and sewers for infiltration during urban raids; rappelling from rooftops of buildings to make entry on upper floors; use of motorcycles for grenade attacks; and raids on buildings with large numbers of occupants perhaps schools or office buildings. Analysts point out that all scenarios involving prisoners and hostages ended in execution. None included plans for negotiated settlements for escape by terrorists. . . The "perfect day" as seen by al-Qaida would combine attacks designed to produce a maximum number of casualties with attacks that would give them the opportunity to get "face time" on the news channels to deliver their rhetoric, explained one expert who viewed the video. GREAT MOMENTS IN ANTI-TERRORISM [This story of the nation’s capital being defended by a 25-footer reminds your ex-hooligan editor of his vessel, the Coast Guard cutter Spar, a 1940s buoy tender and search and rescue vessel. She was fitted out with a 3 inch 50 gun aft, but since it would only fire two points forward of the beam, we could only fire at ships from which we were running away. But since we only had a flank speed of 15, we couldn’t really do that either. I concluded that in battle we would have to rely on moral suasion.] DAVID A. FAHRENTHOLD, WASHINGTON POST - A U.S. Coast Guard boat with twin machine gun mounts began patrolling the Anacostia and Potomac rivers yesterday, the first time in decades the Coast Guard has permanently stationed a boat in the Washington area. The vessel, 25 feet long with a crew of four, was unveiled yesterday morning at a ceremony near Coast Guard national headquarters in Southwest. Dubbed a "homeland security" boat, it cost about $175,000 and is the first of 26 such vessels the Coast Guard plans to have across the country, according to Cmdr. Jim McPherson, a Coast Guard spokesman. . . "We wanted to guard the water gateway to the capital, and we needed a permanent presence here," McPherson said. THE WAR AGAINST WHATEVER DRUDGE REPORT - The legendary [Norman] Mailer rips the United States in a shock Q & A, calling it "so big, so powerful, and so vain..." and warns "every American has to ask himself, 'Am I ready to die for my ideas?'" . . . Mailer claims: "The British have a love of their country that is profound. They can revile it, tell dirty stories about it. But deep down their patriotism is deep. In America we're playing musical chairs - don't get caught without a flag or you're out of the game. Why do we need all this reaffirmation? It's as if we're a three hundred pound man who's seven feet tall, superbly shaped, absolutely powerful, and every three minutes he's got to reaffirm the fact that his arm pits have a wonderful odor. We don't need compulsive, self-serving patriotism. It's odious..." "Culturally, emotionally America is growing more loutish, arrogant, and vain. I detest this totally promiscuous patriotism. Wave a little flag and become a good person? Ugly. If we have a depression or fall into desperate economic times, I don't know what's going to hold the country together... There's just too much anger here, too much ruptured vanity, too much shock, too much identity crisis. And worst of all, too much patriotism. Patriotism in a country that's failing has a logical tendency to turn fascistic... ||| BOSTON GLOBE - US officials acknowledged that they are uncertain how many Al Qaeda and Taliban fighters were killed during a 12-day offensive and whether others escaped or are still hiding in the mountains of eastern Afghanistan. American, Canadian, and Afghan troops scoured the hills and the booby-trapped caves of Paktia province for the remnants of Al Qaeda and Taliban forces and for additional intelligence information following Operation Anaconda . . . However, celebrations by US and Afghan allied forces over the success of the operation, the most intense during the five-month-long war in Afghanistan, remained tempered by conflicting versions of enemy casualties . . . Originally, US commanders estimated that 150 to 200 enemy fighters were hiding in the mountains of Shah-e-Kot district. After a few days of surprisingly heavy resistance, US commanders revised that estimate to as high as 1,000. Afghan military commanders predicted the enemy force could even be significantly larger . . . US spokesmen have said they believe that as many as 800 of the enemy fighters may have been killed in the 12-day assault. But as US and allied forces this week started to search the villages and cave complexes, they found little evidence of Al Qaeda or Taliban casualties. MORE MARCH 2002 ||| PATRICK MARTIN, WORLD SOCIALIST WEB SITE - The 2003 budget released by the White House proposes enormous increases in spending on the military, on spying both at home and abroad, and on domestic repressive measures. This is to be combined with further gargantuan tax cuts for the wealthy, and a virtual freeze on all domestic social spending. It is the outline for an American garrison state, armed to the teeth, the population regimented, at war continuously in one or another far-flung region of the world. Bush proposed the biggest increase in military spending, in both absolute amount and in percentage terms, since the first years of the Reagan administration. Pentagon spending would rise by 14 percent in 2003, to $379 billion. Another $16.8 billion in the Department of Energy budget finances the production of nuclear warheads, bringing to the total military budget to nearly $396 billion. This total is truly staggering, yet it has gone with little criticism, or even comment, in the American media. Under conditions of mounting social needs at home, and with no substantial military antagonist abroad, the US government nonetheless proposes to spend better than $1 billion a day on the military machine. MORE ||| JOHN PILGER, MIRROR, LONDON - Donald Rumsfeld, the Defense Secretary, says he has told the Pentagon to "think the unthinkable." Vice President Dick Cheney, the voice of Bush, has said the US is considering military or other action against "40 to 50 countries" and warns that the new war may last 50 years or more. A Bush adviser, Richard Perle, explained. "(There will be) no stages," he said. "This is total war. We are fighting a variety of enemies. There are lots of them out there . . . If we just let our vision of the world go forth, and we embrace it entirely, and we don't try to piece together clever diplomacy but just wage a total war, our children will sing great songs about us years from now." ||| SCOTSMAN - Britain is ready to use its nuclear arsenal against any rogue state which deploys chemical or biological weapons on UK troops, Geoff Hoon, the Defense Secretary, warned. Mr Hoon raised further the tensions surrounding the imminent deployment of 1,700 British marines in Afghanistan with his controversial comments, aimed at Iraq, Libya, Iran and North Korea. Echoing President Bush's recent approach, he suggested that they were four "countries of concern" which may not be deterred from unleashing weapons of mass destruction by the threat of a nuclear strike. Mr Hoon warned the defense committee in the House of Commons that these countries should be "absolutely confident" that Britain would fire nuclear weapons on them if they deployed their own chemical or biological weapons. His comments exacerbated fears about prospective allied military action against Iraq. MORE ||| ISABEL VINCENT NATIONAL POST, CANADA - Osama bin Laden's al-Qaeda terrorist network has been active in the Balkans for years, most recently helping Kosovo rebels battle for independence from Serbia with the financial and military backing of the United States and NATO. The claim that al-Qaeda played a role in the Balkan wars of the 1990s came from an alleged FBI document former Yugoslav leader Slobodan Milosevic presented in his defense before the Hague tribunal last week. Mr. Milosevic faces 66 counts of war crimes and genocide. Although Hague prosecutors have challenged the veracity of the document, which Mr. Milosevic identified as a Congressional statement from the FBI dated last December, Balkan experts say the presence of al- Qaeda militants in Kosovo and Bosnia is well documented. Today, al-Qaeda members are helping the National Liberation Army, a rebel group in Macedonia, fight the Skopje government in a bid for independence, military analysts say. Last week, Michael Steiner, the United Nations administrator in Kosovo, warned of "importing the Afghan danger to Europe" because several cells trained and financed by al-Qaeda remain in the region . . . "Many members of the Kosovo Liberation Army were sent for training in terrorist camps in Afghanistan," said James Bissett, former Canadian ambassador to Yugoslavia and an expert on the Balkans. "Milosevic is right. There is no question of their participation in conflicts in the Balkans. It is very well documented." In the years immediately before the NATO bombing of Yugoslavia in 1999, the al-Qaeda militants moved into Kosovo, the southern province of Serbia, to help ethnic Albanian extremists of the KLA mount their terrorist campaign against Serb targets in the region. MORE ||| ILENE R. PRUSHER, CHRISTIAN SCIENCE MONITOR - Key Al Qaeda officials, possibly including Ayman al-Zawahiri, the No. 2 to Osama bin Laden, were present in the fortified Shah-i-Kot caves of this region just before the recent US attacks. Local villagers, who spoke on the condition that their village not be identified, provided details on how they were recruited to blast a new network of caves for these fighters - who were formulating plans for additional terrorist attacks on the US - and to provide an escape route for later use. If the workers and mullah are to be believed, the Al Qaeda base that was attacked but not destroyed by Operation Anaconda included computers, satellite phones, maps of major American cities, and pictures of huge US bridges that the men said they could not name. The tales that Al Qaeda's temporary labor force tell are unsettling on many levels. They suggest that some US intelligence sources have been double-dealing them. They suggest that the local population - who will be crucial in any campaign to route out Al Qaeda from this harsh and formidable mountain range - is feeling torn between the US and their Muslim brothers who are calling them to join in a jihad against the dominance of infidels. As the US continues its mopping up efforts in the aftermath of Operation Anaconda, understanding exactly who these villagers were helping is perhaps just one of the many threads officials will begin to unravel. "It started almost two months ago, and I am happy because I made a lot of money from them," says Jalad Khan, a driver who could only hope to make the 70,000 Pakistani rupees ($1,100) that Al Qaeda paid him in two to three years. "They gave us food and goat meat, and we were laughing every day. We were having a very good time - it was like a picnic." That picnic ended hastily, four different men interviewed in one village say, when word spread that the US would begin bombing the next day. A few of the some 100 workers helping the Al Qaeda fighters were also "working" with US forces. So they were able to give the mostly Arab and Chechen fighters a day's notice that Operation Anaconda was about to begin. That information enabled the fighters to send the families traveling with them to a safer place, and spurred the comfortable departure of some of the more senior Al Qaeda figures, who also sent their extraordinarily well-paid workers home. MORE FEBRUARY 2002 ||| MATTHEW ROTHSCHILD, THE PROGRESSIVE - Deep inside the sixth of eight glowing articles in its series "10 Days in September" about what wonderful crisis managers George W. Bush and Condoleezza Rice are, The Washington Post buried the following bit of information: The Pentagon was considering poisoning Afghanistan's food supply. Secretary of Defense Rumsfeld prepared a briefing for Bush on September 17, Bob Woodward and Dan Balz reported. Rice, head of the National Security Council, "and Frank Miller, the senior NSC staffer for defense, went with the President to the Pentagon. Before the briefing, Miller previewed the classified slide presentation prepared for Bush and got a big surprise," Woodward and Balz reported. "One slide about special operations in Afghanistan said: Thinking Outside the Box - Poisoning Food Supply. Miller was shocked and showed it to Rice. The United States doesn't know how to do this, Miller reminded her, and we're not allowed. It would effectively be a chemical or biological attack-clearly banned by treaties that the United States had signed, including the 1972 Biological Weapons Convention. "Rice took the slide to Rumsfeld. 'This slide is not going to be shown to the President of the United States,' she said. "Rumsfeld agreed. 'You're right,' he said." Why this wasn't a major story in itself is beyond me: The Secretary of Defense wanted to propose to the President that he poison Afghanistan's food supply! The Pentagon, unchastened by reports that it had intentionally destroyed Iraq's water supply ten years ago, was still at its old tricks, planning at the highest levels to pull a similarly lethal and illegal stunt in Afghanistan, one that is banned by the Geneva Convention. MORE ||| WAYNE MADSEN - A shootout occurred between Moore County sheriff's deputy Randall Butler and two Special Forces soldiers wearing civilian clothes near rural Robbins, North Carolina, close to the US Army base at Fort Bragg. The training exercise was dubbed "Robin Sage" and involved civilian clothing- clad Special Forces personnel conducting training activities off base . . . ABC News reported that the sheriff's deputy pulled over a car being driven by the troops. When the two Special Forces personnel attempted to disarm the uniformed deputy (believing he was part of their exercise, or so they claim), the deputy shot them, killing one and injuring the other. The Sheriff of Moore County claims the Army never informed him of the exercise and his personnel were not involved in it in any way, although they have been involved in the past in other Fort Bragg military exercises . . . This sort of incident is commonplace in dictatorships where the civilian police remain independent of the national security and military apparatus, i.e. countries in Latin America and Africa. It can not and must not be allowed to happen here. The names of the soldiers were not released. Deputy Sheriff Randall Butler has been placed on administrative leave with pay. ||| PATRICK ORR THE IDAHO STATESMAN Boise probably will be invaded by a small, stealthy group of U.S. Marines this fall - creeping along the Greenbelt, near back yards, and inside buildings. But before checking out real estate prices and schools in Canada, relax - it´s just an exercise. In an effort to better understand urban warfare and get some valuable experience in reconnaissance and intelligence- gathering in a real city instead of a simulation, the Marine Corps plans to visit Boise for some interactive war games. "This is going to be great training for them to test new techniques, to help teach them to (work) in an urban environment," Boise Police Chief Don Pierce said. "It is going to be an interesting and fun community event. There will be a role for citizens to play." MORE ||| CRAIG NELSON, SIDNEY MORNING HERALD - A surprise awaited me as I walked into the airport terminal outside Kandahar that serves as the base for coalition forces in southern Afghanistan. "You've been PNG'd", a colleague told me. Excuse me? "PNG'd. Declared persona non grata," he explained. I didn't know whether to laugh or shake my head at the ludicrousness of it all. During my four months of reporting from Afghanistan, I've been threatened with guns pointed at my head, and been tied up and interrogated, but I had never been pronounced unacceptable with such rhetorical grandeur . . . My offence, coalition spokesman Major Chris Lemay told me before he directed the soldier to usher me out, was writing in an article published in the Herald on Saturday that Australian special operations forces were at the base. Forget the publication elsewhere of the same information. I had broken the taboo of official secrecy. My fall was fast and precipitous. Within a matter of days, the first reporter working for an Australian news organization to gain access to Australian troops in Afghanistan had become the first reporter for an Australian news organization to be expelled from their midst . . . MORE ||| WASHINGTON TIMES - The Bush administration is no longer standing by a 24-year-old U.S. pledge not to use nuclear weapons against non-nuclear states, a senior administration official said. Washington is "not looking for occasions to use" its nuclear arsenal, John Bolton, undersecretary of state for arms control and international security, said in an interview. But "we would do whatever is necessary to defend America's innocent civilian population," he said. In case of an attack on the United States, "we would have to do what is appropriate under the circumstances, and the classic formulation of that is, we are not ruling anything in and we are not ruling anything out," Mr. Bolton said. "We are just not into theoretical assertions that other administrations have made," he said in reference to a 1978 commitment by the Carter administration not to use nuclear weapons against non-nuclear states unless they attack the United States in alliance with nuclear-armed countries. MORE ||| PAUL REYNOLDS BBC - The Pentagon is reported by the New York Times to be setting up a secret unit to engage in propaganda as the United States develops President Bush's declared war on terror worldwide. . . The Americans are well versed in the "black arts." The most famous case of recent years was the evidence given to a Congressional Committee in the run-up to the Gulf War. A young Kuwaiti woman said that Iraqi soldiers had ripped babies from incubators after their invasion. The Committee was much moved. It turned out that the young woman was the daughter of the Kuwaiti ambassador and that there was no credible evidence for her claim. That case showed the value of black propaganda - it is designed for the short term. What mattered then was to mobilize American opinion behind military action. .. Sometimes, the truth does emerge quite quickly and the propaganda fails. The then US Secretary of State Alexander Haig came a cropper once when he claimed that the Soviet Union was dropping a deadly chemical he called "yellow rain" onto Afghanistan (yes, Afghanistan has featured in the propaganda war before), Laos and Cambodia. The "yellow rain" had its own sting - it turned out to be droppings from bees. Sometimes, the lie takes longer to emerge. President Richard Nixon, for example, hid the extent of the American invasion of Cambodia during the Vietnam War. And President Lyndon Johnson pretended that American warships had been attacked by the North Vietnamese in the Gulf of Tonkin to justify escalating the conflict. ||| BEN FENTON, TELEGRAPH, LONDON - The seeds of renewed civil war in Afghanistan have already been planted, the CIA said in a report made public. The analysis of an increasingly lawless situation backs Britain's view that more needs to be done to prop up the infant regime of Hamid Karzai as he tries to stabilize his country. With the CIA and the State Department both urging a greater effort by America and its allies to maintain peace, the White House is coming under pressure to launch a fresh peacekeeping initiative. The rest of the Bush administration, and in particular the Pentagon, has been reluctant to do anything more than it is already doing, except in pursuit of Osama bin Laden, his al-Qa'eda terrorist network and the Taliban. Intelligence analysis suggests that a return to the civil war that wracked the country after Soviet invaders were driven out in 1989 is not imminent. But the CIA has identified rising tensions between the Tajik and Uzbek ethnic groups in Afghanistan and areas of lawlessness where the influence of the central government has not been extended. MORE ||| DAVE MONIZ AND JIM DRINKARD, USA TODAY - Evidence continues to grow that National Guard units across the country are undermanned and have faked their troop level reports to Washington for years in order to protect their flow of federal money and to hide their inability to retain troops. The latest evidence was revealed in court documents introduced during a January military trial in Indiana. A series of e-mail messages from a senior Indiana National Guard officer details a longstanding practice of false troop reporting to the Pentagon and National Guard headquarters in Washington, D.C. . . Indiana Guard officials state in the messages that they believe similar methods are practiced in other states. . . In December, USA TODAY reported allegations from more than 40 officers that at least seven states had inflated rolls with phony troops known as "ghosts." MORE ||| REP DENNIS J. KUCINICH (D-OHIO) - How can we justify in effect canceling the First Amendment and the right of free speech, the right to peaceably assemble? How can we justify in effect canceling the Fourth Amendment, probable cause, the prohibitions against unreasonable search and seizure? How can we justify in effect canceling the Fifth Amendment, nullifying due process, and allowing for indefinite incarceration without a trial? How can we justify in effect canceling the Sixth Amendment, the right to prompt and public trial? How can we justify in effect canceling the Eighth Amendment which protects against cruel and unusual punishment? We cannot justify widespread wiretaps and internet surveillance without judicial supervision, let alone with it. We cannot justify secret searches without a warrant. We cannot justify giving the Attorney General the ability to designate domestic terror groups. We cannot justify giving the FBI total access to any type of data which may exist in any system anywhere such as medical records and financial records. We cannot justify giving the CIA the ability to target people in this country for intelligence surveillance. We cannot justify a government which takes from the people our right to privacy and then assumes for its own operations a right to total secrecy. . . Let us pray that our nation's leaders will not be overcome with fear. Because today there is great fear in our great Capitol. And this must be understood before we can ask about the shortcomings of Congress in the current environment. The great fear began when we had to evacuate the Capitol on September 11. It continued when we had to leave the Capitol again when a bomb scare occurred as members were pressing the CIA during a secret briefing. It continued when we abandoned Washington when anthrax, possibly from a government lab, arrived in the mail. It continued when the Attorney General declared a nationwide terror alert and then the Administration brought the destructive Patriot Bill to the floor of the House. It continued in the release of the Bin Laden tapes at the same time the President was announcing the withdrawal from the ABM treaty. It remains present in the cordoning off of the Capitol. It is present in the camouflaged armed national guardsmen who greet members of Congress each day we enter the Capitol campus. It is present in the labyrinth of concrete barriers through which we must pass each time we go to vote . . . Our Congress gave the President the ability to respond to the tragedy of September the Eleventh. We licensed a response to those who helped bring the terror of September the Eleventh. But we the people and our elected representatives must reserve the right to measure the response, to proportion the response, to challenge the response, and to correct the response. Because we did not authorize the invasion of Iraq. We did not authorize the invasion of Iran. We did not authorize the invasion of North Korea. We did not authorize the bombing of civilians in Afghanistan. We did not authorize permanent detainees in Guantanamo Bay. We did not authorize the withdrawal from the Geneva Convention. We did not authorize military tribunals suspending due process and habeas corpus. We did not authorize assassination squads. We did not authorize the resurrection of COINTELPRO. We did not authorize the repeal of the Bill of Rights. We did not authorize the revocation of the Constitution. We did not authorize national identity cards. We did not authorize the eye of Big Brother to peer from cameras throughout our cities. We did not authorize an eye for an eye. Nor did we ask that the blood of innocent people, who perished on September 11, be avenged with the blood of innocent villagers in Afghanistan. We did not authorize the administration to wage war anytime, anywhere, anyhow it pleases. We did not authorize war without end. We did not authorize a permanent war economy. Yet we are upon the threshold of a permanent war economy DENNIS KUCINICH ||| JEFF ADLER WASHINGTON POST - A judge dismissed a challenge to the imprisonment of 300 suspected terrorists at a U.S. Navy base in Cuba, saying no federal court has jurisdiction over the detention camp because it is on foreign soil. U.S. District Judge A. Howard Matz said the Coalition of Clergy, Lawyers, and Professors has no standing to file a petition on behalf of the prisoners, who were captured in the war in Afghanistan, and that no federal court has jurisdiction over the detention facility known as Camp X-Ray because it is not within U.S. territory. . . Erwin Chemerinsky, a University of Southern California law professor representing the coalition, said he would appeal the decision to the 9th U.S. Circuit Court of Appeals in San Francisco. "I don't think there can be a situation where no court can have jurisdiction," he said. MORE HOLY WAR UPDATE MUCH as we appreciate John Ashcroft's attempts to enlighten us on the religious history of America, he understands it about as well as he does the Constitution, which is to say not much at all. A better source might be Tom Tomorrow's web blog, where the subject has uncovered some lively contributions from people who were actually alive during the times of which Mullah John professes to speak so knowledgably, such as: THOMAS JEFFERSON - If we did a good act merely from the love of God and a belief that it is pleasing to Him, whence arises the morality of the Atheist? It is idle to say, as some do, that no such thing exists. We have the same evidence of the fact as of most of those we act on, to wit: their own affirmations, and their reasonings in support of them. I have observed, indeed, generally, that while in Protestant countries the defections from the Platonic Christianity of the priests is to Deism, in Catholic countries they are to Atheism. Diderot, D'Alembert, D'Holbach, Condorcet, are known to have been among the most virtuous of men. Their virtue, then, must have had some other foundation than love of God.' GEORGE WASHINGTON - The United States is in no sense founded upon the Christian Doctrine THOMAS JEFFERSON - I have ever judged of the religion of others by their lives.... It is in our lives, and not from our words, that our religion must be read. By the same test the world must judge me. But this does not satisfy the priesthood. They must have a positive, a declared assent to all their interested absurdities. My opinion is that there would never have been an infidel, if there had never been a priest. ABRAHAM LINCOLN - The Bible is not my book, and Christianity is not my religion. I could never give assent to the long, complicated statements of Christian dogma THOMAS JEFFERSON - I do not find in orthodox Christianity one redeeming feature THE BUSH increase in the defense budget is enough to double the gross domestic product of Afghanistan for more than two years. || ANN COULTER, NATIONALLY SYNDICATED COLUMNIST, SPEAKING TO THE CHRISTIAN POLITICAL ACTION CONFERENCE - When contemplating college liberals, you really regret once again that John Walker is not getting the death penalty. We need to execute people like John Walker in order to physically intimidate liberals, by making them realize that they can be killed too. Otherwise they will turn out to be outright traitors. ||| REPORTERS WITHOUT BORDERS [RSF] - Doug Struck, correspondent with the Washington Post en Afghanistan, was restrained at gunpoint by American soldiers while he was investigating the impact of an American missile fired in Afghanistan. The group has asked the Secretary of State to provide explanations concerning this incident. . . According to information obtained by RSF, on 10 February 2002, Struck was threatened and restrained at gunpoint by American soldiers, who said they would shoot him if he did not respect a security perimeter around the US missile impact area. "If you go further, you would be shot," said the commanding officer. The Washington Post said it was "baffled" by this incident. . . RSF points out that on 20 December 2001, Joao Silva and Tyler Hicks, photographers with the New York Times, and David Guttenfelder, photographer with Associated Press, were roughed up and threatened by Afghans in the presence of members of American special forces in Meelawa, near Tora Bora. The American commandos refused to allow US journalists to be present in this area, and local Afghan forces were in charge of preventing the press from reaching it. According to David Guttenfelder, members of the US special forces personally gave orders to Afghans to arrest them. Film was confiscated from the photographers. ||| STEVEN ERLANGER NEW YORK TIMES - The German foreign minister, Joschka Fischer, warned the Bush administration not to treat its allies like satellite states in some new empire or move unilaterally against states like Iraq. Fischer thereby added a prominent German voice to a new wave of anxious continental criticism of Washington's post-Afghanistan foreign policy. Fischer, a Green with a strong pro- American reputation, joined his French counterpart, Hubert Vedrine, in slamming the "simplistic" language of President George W. Bush in his State of the Union address, in which he described an "axis of evil" made up of Iran, Iraq and North Korea. "The international coalition against terror is not the foundation to carry out just anything against anybody, and particularly not on one's own," Fischer said, referring to Iraq. "All the European foreign ministers see it that way," he said in a long interview with the conservative German daily Die Welt. ||| CARLOTTA GALL, NY TIMES - Afghan prisoners captured by American forces in two night raids here last month said that they were beaten and abused by American soldiers, despite their protests that they supported the leader of the interim government, Hamid Karzai. The men were among 27 Afghans who were released on Thursday after 16 days' detention in the American base in Kandahar, about 150 miles southwest of Oruzgan . . . Abdul Rauf, 60, the police chief in this small mountain town, said he was beaten, kicked until his ribs cracked and punched by American soldiers when they stormed the district headquarters in the night of Jan. 23-24 and took him and his men prisoner. An American officer apologized to him when he was released, he said, asking forgiveness and saying their capture had been a mistake. "I can never forgive them," Mr. Rauf said in an interview today as he lay on cushions at his home, still clearly suffering from his ordeal. "Why did they bomb us? Why did they do this?" . . . ||| MOLLY MOORE WASHINGTON POST - Several of the 27 former prisoners, who were released Wednesday, said U.S. soldiers treated them so harshly that two men lost consciousness during the beatings while others suffered fractured ribs, loosened teeth and swollen noses. "They were beating us on the head and back and ribs," said Allah Noor, 40, a farmer and policeman for the new government who said he suffered two fractured ribs at the military base where the men were imprisoned. "They were punching us with fists, kicking me with their feet. They said, 'You are terrorist! You are al Qaeda! You are Taliban!' " . . . The U.S. forces, who were wearing masks, tied the detainees' hands and feet, blindfolded them and slipped hoods over their heads, according to several of the prisoners. Each of the prisoners interviewed said they had been beaten, kicked and punched with the soldiers' fists, feet and in some cases, gunstocks. "I thought they were going to kill me," said Ziauddin, 50, who was working as a guard for the new post-Taliban government and said two of his upper teeth had been knocked loose. "We had no idea why they were beating us. We were completely innocent." They were then loaded into helicopters and flown to the U.S. base at Kandahar. When the men reached the base, "They told us to lie on the cold floor," said Allah Noor, the policeman. As the soldiers were beating the men, the prisoners were screaming, "We're Karzai's people. We have been for two months." All 27 men were forced onto their stomachs, with their hands tied behind their backs and their feet chained, according to each of four former prisoners interviewed. They were then all connected with a rope, they said. "They were walking on our backs like we were stones," Rauf said. "They hit me in the head. My nose hit the ground and became very swollen." MORE THE WAR AGAINST SCREWED UP CALIFORNIA DUDES BRIAN MCWILLIAMS, WASHINGTON POST NEWSBYTES - The FBI declined to comment on allegations that federal agents have commandeered online chat accounts belonging to the teen-aged operator of anti-government site Raisethefist. However, the agency denies allegations that it has harassed associates of 18-year-old self-proclaimed anarchist Sherman Martin Austin. According to several of Austin's supporters, someone has repeatedly logged into the teen's accounts on America Online's AOL Instant Messenger (AIM) real-time chat service while he was in police custody. Austin, a resident of Sherman Oaks, Calif., has been incarcerated in a high-security federal jail in Manhattan since Saturday on charges of disorderly conduct following a protest against the World Economic Forum in New York. A friend listed on Austin's AIM Buddy List who identified himself only as "James" said he was threatened Monday by someone he suspects was an FBI agent using Austin's account. "He told me, 'Your ass is next, pal,'" James said. Laura Bosley, a spokesperson for the FBI's Los Angeles field office, declined to say whether the FBI would commandeer someone's AIM account as part of an investigation, citing its ongoing nature. But she said FBI agents would never harass associates of a suspect. . . Matt Yarborough, head of the cyberlaw section at Fish and Richardson and a former assistant U.S. attorney, said it was "certainly possible" that FBI agents commandeered Austin's AIM accounts as part of their undercover work on the case. "I've dealt with federal agents who did things that made my stomach turn. But, assuming these claims are true, the agents might see this as a good technique for flushing people out," said Yarborough, who noted that Austin may also have been instructed to sign on to his AIM account while in custody. However, Mark Rasch, vice president of cyberlaw at Predictive Systems and a former federal prosecutor, said it was most likely that one of Austin's enemies, and not the FBI, was responsible for hijacking his AIM accounts. MORE THE WAR AGAINST WHATEVER ||| ANDREW BUSHELL, WASHINGTON TIMES - Dozens of Afghan warlords were given $200,000 payments and satellite phones to secure their cooperation in the war against the Taliban and its al Qaeda allies, according to bankers, money changers and others close to the transactions. More than 35 local commanders made banking transactions involving identical $200,000 sums late last year, in at least some cases after meetings with U.S. officials. The transactions totaled more than $7 million and helped prompt a spending spree on four-wheel-drive vehicles in Pakistan. . . Asked about the payments, a senior Western diplomat based in Pakistan said, "It sounds like someone in the State Department finally learned how Afghanistan works. The commanders have become fairly adept at selling themselves, and they always need money for guns.". . . However a State Department official in Washington denied knowledge of such a program, calling it "bizarre" and "not something the State Department would normally do." A CIA spokesman declined to comment. MORE ||| MIKE FLUGENNOCK of Mikey 'Zine has discovered a bright side to the Bush war against the evil triad of Iran, Iraq and North Korea: we can look forward to "M*A*S*H*, the Next Generation". SEPTEMBER 11 ||| CHARISSE JONES USA TODAY - In the neighborhoods closest to the site of the worst terrorist attacks in U.S. history, a new fear has taken hold. Despite assertions by local and federal officials that the air downtown is safe to breathe, many who live and work there remain concerned about toxins such as lead, PCBs and asbestos that the terrorist attacks may have left behind. Since the attacks Sept. 11, many recovery workers, residents and students downtown have complained of tightness in their chests, bloody noses, sinus infections and other respiratory ailments. Roughly one in four firefighters who have been working at Ground Zero have what some are calling ''World Trade Center cough'' or another respiratory complaint, fire department officials say. About 750 have had to take medical leave, according to the firefighters' union. Tests of eight Port Authority employees working at Ground Zero showed elevated levels of mercury in their blood. Though no one is certain that working at the site caused the problem, subsequent tests found that the mercury levels of six workers returned to normal after they were reassigned. Now, the Environmental Protection Agency and local health officials are under fire from politicians and others who accuse them of failing to adequately inform the public about potential long-term health risks from asbestos, heavy metals and various chemicals. MORE JONATHAN MILLER AND ROB LEMKIN, OBSERVER, LONDON - Syed Kaing Mabbul was a coconut farmer on the exquisitely beautiful island of Basilan in the southern Philippines, the hottest new target in President George W. Bush's global war on terrorism. His misfortune, his mother told us, is that he has the same name as a commander of the Abu Sayyaf, a bloodthirsty group of Islamic extremists financed by robbery, piracy, ransom and - in the past, at least - by Osama bin Laden. About 150 Americans, the advance party of a force of about 650, are already in the southern Philippines for a six-month 'military' exercise that began formally last Thursday. Their task is to train Filipino soldiers how better to fight Abu Sayyaf, and to rescue kidnapped missionaries Martin and Gracia Burnham of Wichita, Kansas, who have been in captivity for eight months. Syed fled the island last May, and has been living in a lean-to shack on the outskirts of Zamboanga City, on the island of Mindanao, about 15 miles north of Basilan across a turquoise sea. Local Muslims took us to meet Syed's mother, Azirah Mabhul. She told us he had been betrayed to the army by seven fellow Muslims who had split a bounty of a million pesos (about £14,000). 'They picked up my son at 8am,' she told us. 'They brought him to Malagutay Brigade Camp, blindfolded him, beat him, stripped him, then hung him upside down for eight hours. They inserted ground-up chilli paste into his rectum to force him to confess to belonging to Abu Sayyaf.' Azirah said that when she finally located her son, he still couldn't sit down. 'Mum,' he said, 'I just can't take the pain any more.' MORE ||| A ROYAL CANADIAN MOUNTED POLICE "Criminal Intelligence Brief " released under Canada's access to information laws, suggests that the U.S. strikes in Afghanistan may have targeted drug production facilities, not merely terrorist sites. ||| FAIR - In February 2000, reports in Dutch and French newspapers revealed that several officers from the 4th Psyops Group had worked in the news division at CNN's Atlanta headquarters as part of an "internship" program starting in the final days of the Kosovo War. Coverage of this disturbing story was scarce but after FAIR issued an Action Alert on the story, CNN stated that it had already terminated the program and acknowledged that it was "inappropriate." [The Review reported the story - TPR] Even if the Psyops officers working in the newsroom did not directly influence news reporting, the question remains of whether CNN may have allowed the military to conduct an intelligence-gathering mission against the network itself. The idea isn't far-fetched- according to Intelligence Newsletter, a rear admiral from the Special Operations Command told a Pysops conference that the military needed to find ways to "gain control" over commercial news satellites to help bring down an "informational cone of silence" over regions where special operations were taking place. One of CNN's Psyops "interns" worked in the network's satellite division. (During the Afghanistan war the Pentagon found a very direct way to "gain control"-it simply bought up all commercial satellite images of Afghanistan, in order to prevent media from accessing them.) It's worth noting that the 4th Psyops group is the same group that staffed the National Security Council's now notorious Office of Public Diplomacy, which planted stories in the U.S. media supporting the Reagan Administration's Central America policies during the 1980s. Described by a senior U.S. official as a "vast psychological warfare operation of the kind the military conducts to influence a population in enemy territory," the OPD was shut down after the Iran-Contra investigations, but not before influencing coverage in major outlets including the Wall Street Journal, New York Times and Washington Post. The OPD may be gone, but the Bush administration's recent recess appointment of former OPD head Otto Reich as assistant secretary of state for Western Hemisphere affairs is not reassuring. It suggests, at best, a troubling indifference to Reich's role in orchestrating the OPD's deception of the American people. MORE PSYOPS STORY ||| TERRY JONES, THE OBSERVER - To prevent terrorism by dropping bombs on Iraq is such an obvious idea that I can't think why no one has thought of it before. It's so simple. If only the UK had done something similar in Northern Ireland, we wouldn't be in the mess we are in today . . . It is well known that the best way of picking out terrorists is to fly 30,000ft above the capital city of any state that harbors them and drop bombs - preferably cluster bombs. It is conceivable that the bombing of Dublin might have provoked some sort of protest, even if just from James Joyce fans, and there is at least some likelihood of increased anti-British sentiment in what remained of the city and thus a rise in the numbers of potential terrorists. But this, in itself, would have justified the tactic of bombing them in the first place. We would have nipped them in the bud, so to speak. I hope you follow the argument. Having bombed Dublin and, perhaps, a few IRA training bogs in Tipperary, we could not have afforded to be complacent. We would have had to turn our attention to those states which had supported and funded the IRA terrorists through all these years. The main provider of funds was, of course, the USA, and this would have posed us with a bit of a problem. Where to bomb in America? It's a big place and it's by no means certain that a small country like the UK could afford enough bombs to do the whole job . . . . In those American cities we couldn't afford to bomb, we could have rounded up American citizens with Irish names, put bags over their heads and flown them in chains to Guernsey or Rockall, where we could have given them food packets marked 'My Kind of Meal' and exposed them to the elements with a clear conscience. MORE ||| HINDUSTAN TIMES - Alarmed that it was losing support overseas for its war on terrorism, the US has created the office of strategic influence as part of its effort to influence public sentiment and policy makers in both friendly and unfriendly countries. The Pentagon recently created the office of strategic influence, which proposes to broaden its mission of information dissemination into allied nations in the Middle East, Asia and even western Europe, military officials were quoted as saying. The office, the New York Times reported, would assume a role traditionally led by civilian agencies, mainly the State Department . . . The report said little information was available about the office and its multi-million dollar budget, drawn from a $10 billion emergency supplement to the Pentagon budget authorized by Congress in October, has not been disclosed. Headed by Brig. Gen. Simon P. Worden of the Air Force, the new office has begun circulating classified proposals calling for aggressive campaigns that use not only the foreign media and the internet, but also covert operations. The new office "rolls up all the instruments within the Department of Defense to influence foreign audiences," assistant for operations, Thomas A. Timmes, a former Army colonel and psychological operations officer, said at a recent conference. The plans, which have not received final approval from the George W Bush administration, have stirred opposition among some Pentagon officials who say they might undermine the credibility of information that is openly distributed by the defense department's public affairs officers, the New York Times reported. MORE ||| WHY THEY HATE US: In downtown Washington there is a five story high billboard filled with nothing but blue sky and clouds and the legend: "We're above the rest." ||| HUMAN RIGHTS WATCH - Since September 11, the U.S. government has extended new military assistance to governments engaged in serious human rights abuse, including torture, political killings, illegal detention, religious persecution, and attacks on civilians during armed conflict, Human Rights Watch said in a report released today. The report says Congress and the administration have degraded human rights policy by lifting sanctions on arms transfers to countries with poor human rights records and by cutting required approval times for such transfers. On January 9, for example, the United States rewarded Tajikistan for its support of the war on terrorism by lifting an eight-year-old ban on arms sales to that Central Asian state. Tajikistan has a history of torture, suppression of political opposition and the media, and arrests based on religion. "These transfers won't make the United States more secure in the long run," said Joost R. Hiltermann, Executive Director of the Arms Division of Human Rights Watch. "And they make the United States complicit in the abuse of civilians in other countries." In recent months, the United States has made almost daily announcements of foreign military aid, including deliveries of defense equipment, proposed arms sales, financial support, and military training. It has had to lift sanctions on several nations to allow such aid to go through. The United States has also dramatically increased military assistance to old allies that have gained new importance since September 11. In October, the United States began delivering weapons and ammunition to anti-Taliban forces in Afghanistan. Although it urged them to respect human rights, the United States made little effort to keep the equipment out of the hands of the worst human rights abusers. Some warlords are now maneuvering to undermine the new Afghan government's efforts to restore the rule of law. Uzbekistan will receive $43 million in security aid, including $25 million in military assistance and training and $18 million for border security, as a result of its cooperation in the war on terrorism. Uzbekistan has a dismal human rights record, which includes torture and extensive religious persecution. REPORT ||| PHILIP BOWRING, SUNDAY HERALD - It may seem curious that Washington should be the source of a stream of criticism of its few allies in the Arab world while giving active support to Israel's violent occupation of, and ethnic cleansing in, Palestine. But such things become more understandable when one runs up against the arrogance, ignorance and prejudice of much of the New York-based media which so often sets the agenda for US foreign policy, overriding the more measured analysis of US interests, or international ethics, presented by the State Department. It becomes understandable when one sees at first hand how the media and much of academia has been seduced by Samuel Huntington's ''clash of civilizations'' theories, which effectively demonize Islam generally, rather than just its wilder manifestations. Through his thesis, Professor Huntington has helped spread the belief that being a good Muslim and a good American are incompatible, a dangerous doctrine for US domestic security as well as its international position. MORE ||| CAROLYN BOWER & AISHA SULTAN ST LOUIS POST-DISPATCH - The Pattonville event was planned to promote understanding. It ended after questions became "more like badgering," sponsor says. Sheila Musaji and a group of parents in the Pattonville School District planned an evening to promote understanding of the Islamic faith. And they expected to find a sympathetic audience in the Pattonville PTA. But the evening took a hostile turn when some people who don't routinely attend PTA sessions showed up. One called Islam a violent religion and suggested Musaji was lying about her faith. "I have never had an experience quite like that before," Musaji said. Pat DeWitt, president of the Pattonville Council of PTAs, called it "one of the worst evenings of my life." . . . Particularly disturbing to Musaji and other parents were hostile questions and palm-size booklets distributed at the end of the meeting. The booklets show comic-strip drawings of a Muslim threatening to kill a Christian. In the end, the Christian converts the Muslim to Christianity . . . For 20 minutes Musaji talked about the basic tenets of Islam and common misconceptions. Then she asked for questions. One of the first questions: "I want to know why an American would join a religion like this? What would possess you to do that?" Then the questioning became more hostile and loud. After listening to the tone of the questions, DeWitt said, she stood and reminded people that the purpose of the meeting was to provide information, not debate. At one point, a man stood up and said: "It doesn't matter what she said, it's all a lie. It's a violent religion." Musaji said she left the podium after that comment . . . Meanwhile, Musaji said some Baptist friends have said they would show up to support her at her next presentation at the International Festival at the Maryland Heights Community Center MORE MARCH 2002 ||| William M. Arkin, LA TIMES - The Bush administration, in a secret policy review completed early this year, has ordered the Pentagon to draft contingency plans for the use of nuclear weapons against at least seven countries, naming not only Russia and the "axis of evil"--Iraq, Iran, and North Korea--but also China, Libya and Syria. In addition, the U.S. Defense Department has been told to prepare for the possibility that nuclear weapons may be required in some future Arab-Israeli crisis. And, it is to develop plans for using nuclear weapons to retaliate against chemical or biological attacks, as well as "surprising military developments" of an unspecified nature. These and a host of other directives, including calls for developing bunker-busting mini-nukes and nuclear weapons that reduce collateral damage, are contained in a still-classified document called the Nuclear Posture Review, which was delivered to Congress on Jan. 8. Like all such documents since the dawning of the Atomic Age more than a half-century ago, this NPR offers a chilling glimpse into the world of nuclear-war planners: With a Strangelovian genius, they cover every conceivable circumstance in which a president might wish to use nuclear weapons--planning in great detail for a war they hope never to wage. MORE http://www.latimes.com/news/opinion/la-op-arkinmar10.story ||| David Abel, BOSTON GLOBE - Two major military contractors and an independent research team led by MIT scientists produced flawed studies that exaggerated the success of a key test used to justify spending billions of dollars on the fledgling national missile defense program, according to two reports obtained by the Globe. The long-awaited reports, to be released by the General Accounting Office, detail the flawed analysis of critical missile-defense technologies provided by the contractors, Boeing Co. and TRW, verified by senior researchers at the Massachusetts Institute of Technology's Lincoln Laboratory, and hailed by the Pentagon's recently renamed Missile Defense Agency . . . ''The data are garbage - they had to use all these software shenanigans and throw out two-thirds of the data to make it look like a success,'' said a congressional source close to the GAO investigation. ''Up to now, there has been no independent verification of the contractors' claims. This pulls out the rug from those calling the test a success. By any definition, there's no way to call it a success.'' MORE http://www.boston.com/dailyglobe2/063/nation/MIT_team_tied_to_questionable_m issile_studies+.shtml ||| REUTERS - In Gardez, a major split opened up among Afghan troops involved in the fighting. The area's top local commander, a Pashtun, demanded hundreds of mainly ethnic Tajiks reinforcements sent from Kabul be withdrawn from the battle and sent home. "We propose to (Afghan interim leader) Mr. Hamid Karzai to instruct the newcoming troops to go back to their places of origin," Commander Mohammad Ismail, commander of Paktia Province's local Pashtun forces, told a news conference. "I can assure you we obey and support the interim administration. The point is if the issue of Shahi Kot (site of the battle) is resolved, (Northern Commander) Gul Haider's troops might claim it, which is what we oppose. "We take this opportunity that the issue of Paktia be purely left to the people of Paktia," he said . . . Asked if the Americans agreed that Haider's reinforcements should go home, Ismail said through a translator: "The Americans are not involved in the internal affairs of our country. They are promoting a policy of anti al-Qaeda activity. They have not occupied us and are not our bosses. "They are supporting us in restoring stability. I stress they are not our bosses. This is an issue decided by our government." . . . Behind the Bushes THE NEW GENERATION BEHIND THE BUSHES INDEX RICHARD ARMITAGE SEVENTEEN PARAGRAPHS into a story on Bush's retention of CIA director George Tenet, the NY Times quietly drops a bombshell, "Meanwhile, Gen. Colin L. Powell, Mr. Bush's choice to be secretary of state, has selected Richard Armitage, his close friend and a former Pentagon official, to be the deputy secretary, two Republicans close to the Bush transition team said. Mr. Armitage was initially a front- runner for deputy at the Defense Department, and resisted entreaties to work for General Powell, fearing it might interfere with their friendship. But the general has prevailed upon Mr. Armitage to join him at the State Department, associates said." Meanwhile, indeed. Nothing - not even Ashcroft - raises so many warning flags about the intentions of the Bush administration than does the resurrection of this veteran of some of the sleaziest and most corrupt periods of American foreign policy, including the CIA-drug trade love fest in SE Asia and the Iran-Contra scandal. If we had a press and a Democratic Party worthy of their names, the Armitage appointment would be major news. Here, for starters, are some reasons why: OLIVER NORTH, "UNDER FIRE:" [William] Casey handed [Robert] McFarlane a sheet of paper on which he had outlined plans for a new CIA anti-terrorism unit . . . [it] officially sanctioned a secret entity with a mandate to coordinate our government's response to international terrorism - preemptively if possible, retroactively if necessary. I became its first chairman . . . My associates on the Task Force included Noel Koch (and later Richard Armitage) from Defense, Dewey Clarridge and Charlie Allen from the CIA, Buck Revell and Wayne Gilbert from the FBI, Bob Oakley from State, and Art Moreau (and later General Jack Moellering) from the Joint Chiefs of Staff" INDEPENDENT COUNSEL'S REPORT ON IRAN CONTRA: Director Casey's unswerving support of President Reagan's contra policies and of the Iran arms sales encouraged some CIA officials to go beyond legal restrictions in both operations. Casey was instrumental in pairing North with [Richard] Secord as a contra-support team when the Boland Amendment in October 1984 forced the CIA to refrain from direct or indirect aid. He also supported the North-Secord combination in the Iran arms sales, despite deep reservations about Secord within the CIA hierarchy. Casey's position on the contras prompted the chief of the CIA's Central American Task Force, Alan D. Fiers, Jr., to "dovetail" CIA activities with those of North's contra-resupply network, in violation of Boland restrictions. Casey's support for the NSC to direct the Iran arms sales and to use arms dealer Manucher Ghorbanifar and Secord in the operation, forced the CIA's Directorate of Operations to work with people it distrusted . . . Contrary to their testimony to the presidentially appointed Tower Commission and the Select Iran/contra Committees of Congress, Independent Counsel determined that Secretary Weinberger and his closest aides were consistently informed of proposed and actual arms shipments to Iran during 1985 and 1986 . . . The notes demonstrated that Weinberger's early testimony that he had only vague and generalized information about Iran arms sales in 1985 was false, and that he in fact had detailed information on the proposed arms sales and the actual deliveries. The notes also revealed that Gen. Colin Powell, Weinberger's senior military aide, and Richard L. Armitage, assistant secretary of defense for international security affairs, also had detailed knowledge of the 1985 shipments from Israeli stocks. Armitage and Powell had testified that they did not learn of the November 1985 HAWK missile shipment until 1986 . . . There was little evidence that Powell's early testimony regarding the 1985 shipments and Weinberger's notes was willfully false. Powell cooperated with the various Iran/contra investigations and, when his recollection was refreshed by Weinberger's notes, he readily conceded their accuracy. Independent Counsel declined to prosecute Armitage because the OIC's limited resources were focused on the case against Weinberger and because the evidence against Armitage, while substantial, did not reach the threshold of proof beyond a reasonable doubt. US STIPULATION IN OLIVER NORTH TRIAL: Stipulation 61 - In late March 1985, North advised McFarlane that the initial deliveries of US arms from DoD to Honduras had gone well. The Honduran government had expressed its gratitude through those who were supporting the Resistance. North proposed that McFarlane ask Secretary of Defense Weinberger to convey President Reagan's and McFarlane's thanks to DoD personnel who had effected the expedited procurement for the Honduran government, including Assistant Secretary of Defense Richard Armitage and General Gast . . . Stipulation 92 - In late March 1986, Elliott Abrams offered Honduran President Azcona immediate additional security assistance. LtCol North prepared a memorandum from Admiral Poindexter to President Reagan (with copies to Vice President Bush and Chief of Staff Regan) describing the results of Abrams' discussions with Azcona . . . The Honduran army and navy specifically requested a sophisticated ground-to-air missile on the ground that the US had already furnished such weapons to the Resistance. The total cost for the items ultimately agreed upon was approximately 20 million. Among [sic] of the additional assistance to Honduras (in addition to President Reagan, Vice President Bush, Regan, and Admiral Poindexter) were LtGen Gast (Director of DSAA), Assistant Secretary of Defense Richard Armitage, and Deputy Assistant Secretary of Defense Nestor Sanchez. PROJECT PHOENIX: Several figures -- including Theodore Shackley, Thomas Clines and Richard Armitage - later associated with the Iran Contra scandal were involved in Project Phoenix, which was financed in part with opium money. It has been alleged that the close relationship with SE Asian drug dealers continued after the US withdrawal from Vietnam, with Iran used as a conduit for drugs and money. It has also been reported that, as a sequel to Project Phoenix, an off-the-books assassination program was established in Iran. RALPH MCGEHEE: [Ralph McGehee is a former CIA officer who has exposed agency wrongdoing] The Phoenix or Phuong Hoang Operation was originally designed to "neutralize," that is assassinate or imprison, members of the civilian infrastructure of the [Vietnamese] National Liberation Front. Phoenix offices were set up from Saigon down to the district level. Their functions were to: (1) collate intelligence about the "Vietcong Infrastructure"; (2) interrogate civilians picked up at random by military units carrying out sweeps through villages; (3) "neutralize" targeted members of the NLF . . . The original Phoenix concept was quickly diluted, for two main reasons: (1) pressure from the top to fill numerical quotas of person to be neutralized; (2) difficulties at the bottom of identifying NLF civilian infrastructure, who were often indistinguishable from the general population, and the near impossibility of proving anyone membership in the NLF. The result was vastly to increase the numbers of innocent persons rounded up and imprisoned, indiscriminately murdered, and brutally tortured in an effort to show results . . . Between 1968 and 1972 hundreds of thousands of Vietnamese civilians were rounded up and turned over to the Vietnamese police for questioning. Such interrogation has usually been marked by brutal torture. AFTER THE WAR: At the end of 1975, Armitage became as a special consultant to the Department of Defense, working out of Bangkok and dealing with unrepatriated prisoners and the missing in action. Armitage also started a mysterious business called the Far East Trading Company. Meanwhile, from 1976 to 1979 in Iran, Richard Secord was supervising the sale of US military aircraft and weapons to Middle Eastern nations. During this same period, there are reports that Shackley, Clines, Secord, and Armitage set up several curious corporations and subsidiaries around the world including Lake Resources, Stanford Technology Trading Group, Companie de Services Fiduciaria, CSF Investments and Udall Research Corporation. ARMITAGE AND POWELL: Powell and Armitage apparently met first in 1981, and later, when Powell served as chairman of the joint chiefs, "they started to call each other daily to share information and bounce ideas off each other," according to a 1993 profile in USA Weekend. "They have become sounding boards for just about anything the other guy wants to discuss. Often they talk, if only briefly, two or three times a day." Newsweek reported that Armitage "may be Powell's closest friend." ARMITAGE AND ROSS PEROT: Perot and Armitage met in 1986, when Armitage was working on the POW-MIA issue. Perot, bothered by problems with the POW program as well as reports of Armitage's involvement with drug traffickers, urged Armitage to resign. Armitage told the St. Louis Post Dispatch, "I found out he was putting his mouth on me, and I asked him to come to my office." Armitage told Perot that federally investigators had cleared him. Perot went to see President Bush who said it was a matter for the FBI. Perot then met with FBI Director William Webster and subordinates, pointing out, among other things, that Armitage had given a character reference for a Vietnamese woman convicted of conducting a major illegal gambling operation in Arlington, Virginia. Bush nominated Armitage to be Secretary of the Army in 1989 but Armitage withdrew before the confirmation hearing following reports that Perot and veteran organizes were gearing up to oppose him. Syndicated columnist Jack Anderson reported in 1986 that the President's Commission on Organized Crime had questioned Armitage about his relationship with the Vietnamese refugee. Powell sided with Armitage on the issue. [The pro-CIA Time Magazine rises to Armitage's defense] GEORGE J. CHURCH, TIME MAGAZINE, 1987: Among the targets of Perot's current probe are some whose names have surfaced in connection with Iranscam. He has been looking into the alleged links between ex-CIA agents Thomas Clines and Theodore Shackley, retired Generals Richard Secord and John Singlaub, Iranian born Businessman Albert Hakim and other former and present Government officials going back to the early 1960's. "I think we'll conclude that Admiral Poindexter and Colonel North were bit players," he told the Washington Post, "and the major characters were people who were in the weapons business for years, some of whom had CIA connections." A far more curious target is Assistant Secretary of Defense Richard Armitage, a man widely respected for his integrity and effectiveness. After his appointment in 1981, Armitage began working in Southeast Asia to track down reports of MIAs in Viet- Nam; Perot suspected him of not doing enough. Last October, Perot met with Armitage at the Pentagon and bluntly demanded that he resign. Perot's stated reason was that Armitage had written, on Pentagon stationery, a glowing character reference for a Vietnamese woman refugee, Nguyet Thi O'Rourke, who had been convicted of running a gambling operation in Virginia. Armitage later conceded that using Pentagon stationery had been "dumb", but not illegal or improper. At the meeting, Armitage vigorously denied any implication that he had anything to do with an illicit arms or drug network . . . Lately, Perot and his investigators have been interviewing people who have also been questioned by the Christic Institute, a Washington public interest law firm. Christic last year filed a suit in Miami against Clines, Shackley, Secord, Singlaub, Hakim and 24 others; Armitage is mentioned several times but is not a defendant. The suit charges that some of the defendants became involved in drug smuggling from Southeast Asia in the early 1960's and later in a series of shady weapons deals around the world, using the profits to finance covert anti-Communist activities. But the lawsuit's allegations, many of which are inaccurate or based on false assumptions, are a shaky foundation on which to base an investigation. Armitage calls the suit "malicious" and has a four-page list of factual refutations. For example, an affidavit filed by the Christic Institute's attorney claims that Armitage was in Bangkok setting up a company that allegedly served as a front for the movement of opium money during a period in the late 1970's; part of that time he was actually living in Washington and working as administrative assistant to Senator Robert Dole. ARMITAGE AND BURMA: UNOCAL is the leading American investor in Myanmar, a target of widespread sanctions and boycotts for its repressive regime. In 1997 Richard Armitage reportedly went to Burma on a trip sponsored by the Burma/Myanmar Forum, a Washington group with major funding from UNOCAL. RICHARD ARMITAGE SOURCES LIST NEIL BUSH || MICHAEL ISIKOFF, NEWSWEEK - What was Neil Bush doing in Jidda, Saudi Arabia, last week? Officially, the president's youngest brother was a keynote speaker at an international business forum. . . Newsweek has learned the presidential sibling also had another agenda: recruiting Middle East investors for an educational-software firm that, industry sources say, may benefit enormously from the new $26.5 billion education bill signed by President George W. Bush. Neil Bush's Austin-based firm, called Ignite, has raised about $18 million since last year, mostly from foreign investors in Japan, Taiwan and the Middle East, said Ignite exec Kenneth Leonard. The company is exploring joint ventures with computer software firms in Dubai and is seeking contracts with the United Arab Emirates' Ministry of Education and other foreign governments, said Leonard, who has accompanied Bush on three trips to the Mideast since George W became president. Neil Bush's business career has created problems for his family in the past. In 1990, while his father was president, he was reprimanded by federal regulators for his role as a director of the failed Silverado Savings & Loan. Bush told Newsweek he has avoided contacting U.S. officials during his recent travels and said there was nothing improper about his seeking business from foreign governments. . . Bush also said he doesn't talk to the White House about Ignite. "I don't get permission from my brother to do business." But some rivals say Bush's role in Ignite could help the firm cash in on a booming new market in "digital learning"-in part due to a fresh infusion of funds for school districts from his brother's education bill. Ignite recently began marketing its first product-an American-history software program-to local school officials. "There's only about four or five [educational-software] firms in a position to take advantage of all this new money, and Neil Bush's company is one of them," said a rival. MORE 2/02 LOUIS DUBOSE, AUSTIN CHRONICLE In 1990, Neil Bush paid a $50,000 fine and was banned from banking activities for his role in taking down Silverado, which actually cost taxpayers $1.3 billion. A Resolution Trust Corporation suit against Bush and other officers of Silverado was settled in 1991 for $26.5 million . . . A Republican fundraiser set up a fund to help defer costs Neil incurred in his S&L dealings . . . As a director of a failing thrift in Denver, Bush voted to approve $100 million in what were ultimately bad loans to two of his business partners. And in voting for the loans, he failed to inform fellow board members at Silverado Savings & Loan that the loan applicants were his business partners. Federal banking regulators later followed the trail of defaulted loans to Neil Bush oil ventures, in particular JNB International, an oil and gas exploration company awarded drilling concessions in Argentina -- despite its complete lack of experience in international oil and gas drilling . . . LYNNE CHENEY ANEMONA HARTOCOLLIS, NY TIMES: Lynne Cheney, wife of the vice president, has challenged Judith A. Rizzo, deputy chancellor for instruction in New York City schools, on what should be taught in the wake of the Sept. 11 attacks, though Dr. Rizzo said her original remarks were misinterpreted. A Sept. 30 article in The Washington Post quoted Dr. Rizzo as saying: "Those people who said we don't need multiculturalism, that it's too touchy-feely, a pox on them. I think they've learned their lesson. We have to do more to teach habits of tolerance, knowledge and awareness of other cultures." In response, Mrs. Cheney, in a speech to the Dallas Institute of Humanities and Culture, said that the argument that it had now become more important to teach multiculturalism implied that "it was our failure to understand Islam that led to so many deaths and so much destruction." Mrs. Cheney said that while it was important to teach about world cultures, she would urge schools to put added emphasis on American history. She cited a survey of 55 colleges that found American history was not a required course. RICHARD CHENEY ||| MARTIN A. LEE SAN FRANCISCO BAY GUARDIAN November 13, 2000 - During former defense secretary Richard Cheney's five-year tenure as chief executive of Halliburton, Inc., his oil services firm raked in big bucks from dubious commercial dealings with Iraq. Cheney left Halliburton with a $34 million retirement package last July when he became the GOP's vice-presidential candidate. Of course, U.S. firms aren't generally supposed to do business with Saddam Hussein. But thanks to legal loopholes large enough to steer an oil tanker through, Halliburton profited big-time from deals with the Iraqi dictatorship. Conducted discreetly through several Halliburton subsidiaries in Europe, these greasy transactions helped Saddam Hussein retain his grip on power while lining the pockets of Cheney and company. According to the Financial Times of London, between September 1988 and last winter, Cheney, as CEO of Halliburton, oversaw $23.8 million of business contracts for the sale of oil-industry equipment and services to Iraq through two of its subsidiaries, Dresser Rand and Ingersoll-Dresser Pump, which helped rebuild Iraq's war-damaged petroleum-production infrastructure. The combined value of these contracts exceeded those of any other U.S. company doing business with Baghdad. . . With Cheney at the helm since 1995, Halliburton quickly grew into America's number-one oil-services company, the fifth-largest military contractor, and the biggest nonunion employer in the nation. Although Cheney claimed that the U.S. government "had absolutely nothing to do" with his firm's meteoric financial success, State Department documents obtained by the Los Angeles Times indicate that U.S. officials helped Halliburton secure major contracts in Asia and Africa. Halliburton now does business in 130 countries and employs more than 100,000 workers worldwide. MORE 1/02 ||| ROBERT MOORE, CENTER FOR PUBLIC INTEGRITY - When a generous patron of President Bush and the Republican Party sought political backing for his company's multi-billion dollar Alaskan pipeline project, he turned to Vice President Dick Cheney, head of the administration's energy policy task force, known formally as the National Energy Policy Development Group. Forrest Hoglund, Chairman and CEO of Arctic Resources Co., was one of an undisclosed number of executives from private energy companies that advised Cheney and members of his task force last year. Hoglund has also been a generous contributor to Republican causes; he has given more than $200,000 since 1997. The Bush administration has refused to disclose the names of the outside advisers to its energy policy task force. In a meeting with Cheney last year, Hoglund told the Center for Public Integrity, he asked Cheney to support Arctic Resources' Alaskan pipeline project. The task force, in its final recommendations to President Bush, did not include the specific pipeline route from Alaska that Arctic Resources sought. But it did endorse expediting the necessary permits to build a pipeline along an unspecified route from Alaska to the lower 48 states. MORE 1/02 VEEP STAKE Richard Cheney and Joe Lieberman are two of the most curious choices for vice president of recent times. While commentators have come up with a number of contorted explanations, the most obvious one is being ignored: Cheney and Lieberman's real constituency is not a collection of voters but the defense industry, which they can be expected to serve as faithfully as they have in the past. Lieberman comes from the land of the Sikorsky helicopters and told Connecticut voters as recently as last October that "In my view, one layoff is one too many because each and every worker represents the very heart and soul of our national defense." Selecting a couple of reliable Pentagon pimps is important at this time for reasons not widely reported: there is strong bipartisan support for a planned massive increase in defense spending. The build-up would raise the size of the Pentagon budget relative to GDP by about 50%. This is not a secret plan. For example, Defense Daily reported on August 16 that the Marine Commandant, General James Jones, was talking about going from "about 2.9 percent through a gradual ramp-up to about 4 and 4.5 percent of the US Gross Domestic Product. And the Washington Post said: "The nation's military leaders say they will loyally obey the president's marching orders until the moment he leaves office in January. But when it comes to money matters, they already are targeting the next administration." Just in the short term, the increases sought are "equal to almost the entire budget for the Education Department." Said a civilian Pentagon official, "the service requests have been unrestrained." Writes the Post: "'We're going for the big money,' said an officer on the staff of the Joint Chiefs, adding that his bosses are 'a little bit like kids in the candy store.'" The military especially likes Bush but won't be disappointed with Gore who told the Veterans of Foreign Wars a few years ago: "It is the Republican Congress themselves that would cut defense at the turn of the century to try to make their numbers fit together. Again, look beyond the rhetoric and look at the facts. Let me repeat. It is the Republican defense budget, not President Clinton's, that drops in the next century. President Clinton's budget, which is also there for your to see, does not. It increases." *** PUBLIC I: Under the guidance of Richard Cheney, a get-the-government-out-of-my-face conservative, Halliburton Company over the past five years has emerged as a corporate welfare hog, benefiting from at least $3.8 billion in federal contracts and taxpayer-insured loans. One of these loans was approved in April by the US Export-Import Bank. It guaranteed $489 million in credits to a Russian oil company whose roots are imbedded in a legacy of KGB and Communist Party corruption, as well as drug trafficking and organized crime funds, according to Russian and US sources and documents. Those claims are hotly disputed by the Russian oil firm's holding company . . . If Halliburton has benefited from government generosity, it also has reciprocated with substantial political contributions, largely to Republicans. During Cheney's five years at the helm, the company has donated $1,212,000 in soft and hard money to candidates and parties, according to numbers compiled by the non-partisan Center for Responsive Politics. In the five years prior to his arrival, the company had given $534,750. THE DALLAS MORNING NEWS reports that GOP vice presidential candidate Dick Cheney failed to vote in 14 of 16 elections since moving to Texas in 1995. Cheney's Democratic rival for the vice presidency, Sen. Joe Lieberman of Connecticut, has a five-for-six rate of election participation over the same period according to the paper. 1987 was a big year in the Reagan administration. The Iran-Contra chickens were coming home to roost. The previous December, CIA director William Casey had developed a brain tumor and lost his ability to speak. In February 1987 he resigned and died soon afterwards. That same month, former National Security Director Robert McFarlane tried to commit suicide. Also in February, the Tower Commission laid the blame on White House chief of staff Donald Regan for the "chaos that descended upon the White House" in the Iran-Contra affair. The commission praised Bush for his "vigorous reaffirmation of US opposition to terrorism in all forms" Regan was forced to resign.In November a joint congressional investigation of Iran Contra issued a bland report that cleared Vice President Bush. Key to the exculpation was senior House Republican member Richard Cheney. When he became president Bush appointed Tower as Defense Secretary and fellow Tower Commission member Brent Scowcroft as national security adviser. The Senate refused to confirm Tower and Bush named the loyal Cheney in his stead. Cheney's voting record was slightly more conservative than mine -- Newt Gingrich. In 10 years in the House, [Dick Cheney]... chocked up a conservative voting record that rivaled Senator Jesse Helms's. -- Business Week GREG PIERCE, WASHINGTON TIMES: As secretary of defense, Richard B. Cheney entertained major Republican contributors at private meetings at the Pentagon, the Associated Press reports, citing documents gathered by congressional fund-raising investigators. Mr. Cheney was host for at least two GOP donor gatherings inside the Defense Department in 1991 and in 1992, the records show. "If he's having an open house for contributors at the Pentagon, it does bring back reminiscences of the Lincoln Bedroom," said Larry Makinson, executive director of the Center for Responsive Politics . . . On Aug. 19, 1992, members of the Presidential Roundtable (minimum donation $5,000) attended a briefing with Mr. Cheney . . . A Republican National Committee brochure that touted the benefits of joining the Presidential Roundtable included a picture of Mr. Cheney briefing members at the Pentagon. SAM SMITH, "WHOSE WAR IS IT?," TPR 1992: George Bush's behavior in [the Iraq] affair is bizarre even by presidential standards, let alone constitutional ones. He has barely consulted the joint chiefs of staff while making a commitment of American troops close to that in Vietnam. When Defense Secretary Cheney made a televised announcement that the US might be sending more troops to Saudi Arabia, Gen. Colin Powell learned of it while on his way back from the Middle East. And the president has clearly not consulted Congress. The question inevitably arises: whose war is this going to be? Sununu's? Cheney's? Millie's? Some of the speculation has bordered on the grotesque. The emir of conventional journalism, David Broder, wrote on November 18: "It is almost impossible to imagine a more serious, calm, cautious, rational and prudent set of people than those the president has assembled." The New York Times's R. W. Apple Jr., who got off to a bad start in August characterizing Bush as "tough" and "statesmanlike," had recovered enough by December to write: "Right from the start, foreign policy professionals have complained that Mr. Bush, something of a foreign policy professional himself, has drawn the circle too tight, limiting discussions of really important positions to himself, Secretary of State James A. Baker 3rd, Defense Secretary Dick Cheney and Brent Scowcroft, his national security advisor." One foreign editor on the case described the vision of the White House as being as though looking through a "rifle sight." There is no apparent consideration of long-term effects, cultural factors, the links with other regional issues or history. I suspect that for George Bush, invading Iraq would not really be a war at all, but as with Noriega, more of a personal match -- tennis by other means. An old preppie treating the whole world as his country club. TPR, FEBRUARY 1992: Extra! reports that People magazine's Dirk Mathison made three surreptitious visits [to Bohemian Grove] last July, aided by members of the Bohemian Grove Action Network. Among the activities he witnessed was a speech by former Navy Secretary John Lehman, who said the Pentagon estimated that 200,000 Iraqis were killed in the recent war. Other policy addresses were by Richard Cheney, Joseph Califano, and Elliott Richardson. Mathesin, however, was recognized by an official of Time Warner (People's owner), who made him leave. Mathesin had plenty of material and turned in a story, but after an initially enthusiastic response, the piece was killed, just as early stories on the Grove for NPR and Time had been scotched. CARLYLE GROUP VICTOR THORN, BABEL MAGAZINE - A few weeks ago, James Baker publicly offered advice to the Bush Administration on how they should proceed with their war on Iraq. What he and every newscaster or commentator failed to mention was that Baker is now employed by the highly-influential Carlyle Group, which is the eleventh largest defense contractor in the United States. . . If you're not familiar with them, the Carlyle Group has become a powerhouse in affecting the direction in which our foreign policy takes, especially in regard to war. They accomplish this by hiring former government officials, then investing in private companies that are subject to government change (i.e. the military and telecommunications). Who, you may ask, do they employ to secure their government contracts? Well, check-out this list for starters: - Frank Carlucci - Department of Health, Education and Welfare - 1970's Deputy Director, CIA - 1978-81 Deputy Secretary of Defense - 1981-82 National Security Director - 1987-89 - George Bush - CIA Director - 1976-77 Vice President of the United States - 1981-89 President of the United States - 1989-93 - James Baker - Chief of Staff - 1981-85 Secretary of the Treasury - 1985-89 Secretary of State - 1989-93 - Dick Darman - Former White House Budget Chief William Kennard - Former Head, FCC - Arthur Levitt - Former Head, SEC - John Major - Former Prime Minister, Britain - Fidel Ramos - Former Philippine President - Afsaneh Beschloss - Treasurer & Chief Investment Officer of the World Bank - Anand Panyarachum - Former President, Thailand Karl - Otto Pohl - Former President, Bundesbank Louis Vuitton - French Aerobus Company - Park Tae Joon - Former South Korean Prime Minister - Alwaleed Sin Talal bin Abdulaziz Alsaud - Saudi Arabian Prince - George Soros - New World Order/Bilderberg luminary & int'l financier - Fred Malek - George Bush Sr's campaign manager. . . Carlyle also employs the former chairman of BMW and Nestle, is interviewing former Clinton cabinet members (to insure that they have both sides of the aisle covered), plus once hired Colin Powell and AOL Time-Warner Chairman Steve Case to speak at a meeting at Washington D.C.'s Monarch House. . . The Washington Business Journal simply says, "The Carlyle Group seems to play be a different set of rules." ||| STEVE GELSI, CBS MARKET WATCH - In October of 1997, The Carlyle Group purchased a majority stake in United Defense Industries in the midst of a slowdown in U.S. military spending following the end of the Cold War. After Sept. 11, President George W. Bush proposed huge increases in military spending now pending before Congress. The languishing defense sector has heated up and with it military-flavored IPOs have surfaced from several players including Tuesday's Anteon International (ANT: news, chart, profile), Integrated Defense Technologies (IDE: news, chart, profile), Man Tech International (MANT: news, chart, profile) and upcoming information technology specialist Veridian. The $400 million United Defense Industries IPO was the first to debut in the latest salvo of weapons debutantes. When the maker of military vehicles went public in December, Frank Carlucci owned 40,000 shares at an average strike price of $4.71, according to the company's IPO filings. The IPO debuted at $19 per share and has since risen to more than $27 per share. Carlucci is showing a tidy paper profit of $892,000 on his stake in United Defense Industries - pretty respectable. Granted, there are lockup periods governing when insiders can sell their shares, but in this time of post dot-com meltdowns and a barren IPO landscape, it's amazing to see that such big profits are still possible. Carlyle filed a $160 million IPO for U.S. Marine Repair, a Norfolk, Va. specialist in maintaining and refurbishing Navy ships. Although the IPO market may soon tire of all these military deals, this one should do fairly well and provide another nice payday for The Carlyle Group. With access to folks like Secretary of Defense Donald Rumsfeld and Vice President Dick Cheney, Carlyle seems to have the defense game rigged as one of the biggest military contractors in the country. Sure it's just good business to buy low and sell high, but the Carlyle Group seems to be a bit too well connected. 3/02 MORE ||| JASON NISSÉ, INDEPENDENT, LONDON President George W Bush's administration, already on the back foot over its connections with the collapsed energy giant Enron, faces questions over a massive defense contract which aided an investment firm with Bush family links. Last September, the Army signed a $665 million contract to develop the Crusader Advanced Field Artillery System, a $12 billion weapons programmed being built by United Defense Industries. Last week, Mr Bush signed a defense appropriation bill which included $487 million for the programmed. This has helped Carlyle Group, the well-connected Washington-based investment group, which controls UDI, to float the defense contractor on the New York stock exchange . . . Its chairman is Frank Carlucci, who was Defense Secretary in the Reagan administration and is a close friend of Donald Rumsfeld, the current Defense Secretary. The two were members of the same wrestling team at Princeton University. The chairman of Carlyle Europe is John Major, the former British Prime Minister. An adviser to Carlyle in Asia is George Bush Snr, the former president and father of the current president. And George W Bush himself was, for five years, on the board of Caterair, a business Carlyle backed. "It's the first time the President of the United States' father is on the payroll of one of the largest US defense contractors," said Charles Lewis, a director of the Center for Public Policy . . . Carlyle denies that any of its managers, directors or advisers used their influence to aid contracts for UDI. MORE *** MARK FINEMAN, LA TIMES - Even by Washington standards, the Carlyle Group has some serious clout. President George W. Bush's father works for Carlyle; so does former Defense Secretary Frank C. Carlucci, whose close friend Donald H. Rumsfeld now runs the Pentagon; and so does a stellar cast of retired generals and Cabinet secretaries, including former Secretary of State James A. Baker III. And even by Wall Street standards, the Carlyle Group has some serious money: $12.5 billion in investments at last count . . . On a single day last month, Carlyle earned $237 million selling shares in United Defense Industries, the Army's fifth-largest contractor. The stock offering was well timed: Carlyle officials say they decided to take the company public only after the Sept. 11 attacks. The stock sale cashed in on increased congressional support for hefty defense spending, including one of United Defense's cornerstone weapon programs . . . By any standard, the Carlyle Group has the right address. Its suite of offices are on Pennsylvania Avenue midway between the White House and Congress - a 15-minute walk to each . . . As its reputation grew, so did the group's star-studded management roster. It added former Joint Chiefs of Staff Chairman Gen. John M. Shalikashvili; Arthur Levitt, the long-serving former chairman of the Securities and Exchange Commission; former British Prime Minister John Major; former Secretary of State Baker; and former President Bush MORE *** DAILY TEXAN - The Carlyle Group is a global private investment firm, anchored in Washington, D.C., with heavy stakes in military contracting. What makes Carlyle significant is the powerhouse payroll of the firm which includes former U.S. president George Bush, former secretary of state and current G.W. Bush confidant James Baker, former defense secretary Frank Carlucci, and former British prime minister John Major. Those versed in process of revolving door politics will realize that the Carlyle Group is perhaps the world's pinnacle of cronyism and business opportunism . . . The Carlyle Group can profit heavily from military action in the Middle East. The Wall Street Journal recently raised issues with former president Bush's involvement in the Carlyle Group and Judicial Watch, no friend of liberals or Democrats, has called for Bush's outright resignation from a group that could profit from his son's economic and military decisions. George W.'s escalation of the war will create more and more military contracts, boosting stocks in Carlyle portfolios, profiting the elder Bush, and, eventually, George W. *** REUTERS - Defense companies are back after a five-year absence from the market for new equity issues. And they could not have picked a better time. The war in Afghanistan and the government commitment to a long fight against terrorism at home and abroad foreshadow increases both in defense budgets and, more importantly, in the government spending in new equipment and technology, analysts said . . . Demand for United Defense shares, which are expected to sell at between $18 and $20 apiece, is strong, sources in the investing community say . . . United Defense, which produces combat vehicles, artillery and missile launchers, is well aware of the opportunity to capitalize on such momentum. ``The terrorist attacks of Sept. 11, 2001 have generated strong Congressional support for increased defense spending,'' the company said in its filing with U.S. regulators. Taking advantage of the favorable climate for defense companies, the banks managing United Defense's IPO have sped up the deal . . . Initially, the company said it would raise up to $300 million. A month later, when it set the price range for its shares, its expectations had increased to $422 million . . . United Defense will sell 21.1 million shares, but the company's main stockholder, private equity firm Carlyle Group, will get more than half of the money raised. MANHATTAN INSTITUTE [JOHN J. DIIULIO JR. AND STEPHEN GOLDSMITH, whom George Bush is placing in charge of his cash-for-Christ program, are senior fellows of the conservative Manhattan Institute and colleagues of Charles Murray, author of the notorious "Bell Curve." As we have pointed out, the problem with Bush's plan is not that religious organizations would get public funds for public services, but that Bush is crediting to these groups virtues that have far more to do with their community base than with their "faith base." By making an invidious distinction between religious and secular community groups, Bush would be in clear violation of the Constitution in a way that community-based programs coincidentally including religious groups would not be.] * NY TIMES: For years, Mr. DiIulio, who taught at Princeton before the University of Pennsylvania, was known more for his work on criminal justice issues than on his interest in faith-based programs. He was among the voices loudly advocating increased prison construction in the early 1990's . . . Mr. Goldsmith, a former prosecutor, was a two-term mayor in Indianapolis who privatized everything from golf course construction to sewage treatment and showed an interest in revitalizing long-neglected inner-city neighborhoods . . . "There's a lot of respect for Stephen Goldsmith," said Rabbi David Saperstein, director of the Religious Action Center of Reform Judaism. "Many in the Jewish community know him and respect him, but any time you have a formal government endorsement of religion that this faith-based office conveys, that takes us down a path that too often in our history has turned out to be disastrous for religious freedom and religious tolerance." * NORMAN SOLOMON: The Manhattan Institute was founded in 1978 by William Casey, who later became President Reagan's CIA director. Since then, the Institute's track record with authors has been notable. Funneling money from very conservative foundations, the Institute has sponsored many books by writers opposed to safety-net social programs and affirmative action. During the 1980s, the Institute's authors included George Gilder (Wealth and Poverty), Linda Chavez (Out of the Barrio) and Charles Murray (Losing Ground). Murray's Losing Ground -- a denunciation of social programs for the poor -- catapulted him to media stardom in 1984 . . . Along with ongoing subsidies from a number of large conservative foundations, the Manhattan Institute has gained funding from such corporate sources as the Chase Manhattan Bank, Citicorp, Time Warner, Procter & Gamble and State Farm Insurance, as well as the Lilly Endowment and philanthropic arms of American Express, Bristol-Myers Squibb, CIGNA and Merrill Lynch. * MANHATTAN INSTITUTE: "Education and Welfare: Meeting the Challenge: A Message from CCI [a division of Manhattan Institute]Chairman, Mayor Stephen Goldsmith : . . . The conference brought together public officials like Wisconsin Governor Tommy Thompson and scholars like Dr. Charles Murray to discuss how governments and private groups have reduced dependency and increased self-sufficiency . . . Fifteen years after the Manhattan Institute published Charles Murray's landmark study of American welfare policy, "Losing Ground," the presentations showed that ideas once seen as radical now form the mainstream of the welfare debate." * VILLAGE VOICE, Aug 8, 2000: Absent in the sticky Philadelphia heat was the drumbeat of the fire- breathing, nay-saying Christian Right. In its place, singing the praises of the Jesus-influenced candidate and following a script laid out by the Manhattan Institute . . . The social scientists from the Manhattan Institute rolled out their charts and reported that kids who go to church in poor neighborhoods do fewer drugs and thus, churches, mosques, and synagogues "should be supported as uniquely qualified agencies of social control that matter a great deal in the lives of adolescents in America's most disorganized and impoverished communities." INSTITUTE FOR PUBLIC ACCURACY * PROGRESSIVE REVIEW, August 2000: Besides helping to make "faith-based" the politicians' favorite euphemism for 'religious,' the [Manhattan Institute] has fostered the notorious Charles Murray as well as one of George Bush's favorite writers, Michael Magnet, author of the 'The Dream and the Nightmare,' the latter being all those poor folks mucking up the place. In a review in the Texas Observer, Michael King wrote: "Poor people are poor and nasty because they choose to be so, and any attempt by the community at large to ameliorate their unhappy circumstances is by definition counterproductive. And though he tap- dances around the subject in various statistical ways, the undeserving poor (a.k.a. the underclass), whom Magnet pities and despises in almost equal measures, are most specifically the black urban poor: those foul-mouthed, crack-smoking, baby-dropping, white-folks mugging, wild-running Caliban-caricatures of the suburban imagination, who refuse to work because they have learned (apparently from reading Norman Mailer, Michael Harrington, and R.D. Laing) that they can act crazy on street corners selling dope without fear of retribution while readily pocketing twenty grand a year on welfare. "What are the solutions to this cultural catastrophe? Do nothing - only much more nothing. Scratch these neo-cons and one inevitably turns up Charles Murray (of Losing Ground and The Bell Curve), the "brilliant" sociologist who has concluded repeatedly that all welfare programs should be abolished because they do more harm than good (especially by allowing able-bodied mothers to stay home with their kids when they should be on the job market keeping wages down). Lately Murray has taken to saying the same thing about public education, since certain children are, well, ineducable. (We all know who they are.) Magnet suspects Murray is right, although he says he wouldn't go that far - the requisite political will is unfortunately lacking, and perhaps in the short-term, "casualties would be too great." He counsels instead the usual draconian measures to force welfare mothers (only the deserving widowed or divorced, of course) into the job market, although with surprisingly liberal provisions for day care and Head Start programs." [According to the Manhattan Institute, "Referring to this book, Gov. Bush has said, other than the Bible, that it was the most important book he had read..."] The Manhattan Institute is obsessed with such matters. Eric Alterman, in the Nation, described another of its good works: "The great book of the New Right's assault on traditional forms of knowledge was Charles Murray's anti-welfare tract Losing Ground: American Social Policy, 1950-1980 (1984) The Manhattan Institute inaugurated an extraordinary campaign to sell Murray to the public. Once the book was published, [MI President William Hammett] sent 700 copies to journalists, politicians and academics and hired a PR expert to turn the unknown author into a media celebrity. He paid journalists $500 to $1,500 each to participate in a seminar on Murray and his thought. The book itself proved to be the prototype of "The Bell Curve:" Murrayite ideology mixed with pseudo-science and killer public relations . . . Welfare causes poor (read "black") people to breed like bunnies, and "we" would be doing everyone a favor if we just stopped encouraging "them." "We tried to provide more for the poor, and we created more poor instead," as Murray argued . . . A decade later, Murray would undertake an even grander mission on behalf of his sponsors. It would be to make racism scientifically respectable. Murray's research was considered so controversial that this time the Manhattan Institute refused to have anything to do with him, and he was shunted off to the American Enterprise Institute." New York artist-activist Robert Lederman [notes that] Hitler himself, while schmoozing with the Vatican in 1933, said, "Secular schools can never be tolerated because such schools have no religious instruction, and a general moral instruction without a religious foundation is built on air; consequently, all character training and religion must be derived from faith . . . we need believing people." MANHATTAN INSTITUTE JOHN NEGROPONTE TERRY ALLEN, IN THESE TIMES: Like spooks from an abandoned B-Movie graveyard, officials of the Reagan-Bush era are emerging from the dirt and showing up inside the George W. Bush administration. The latest resurrection is John Negroponte, whom Bush recently nominated as ambassador to the United Nations. As US ambassador to Honduras from 1981 to 1985, Negroponte abetted and covered up human rights crimes. He was a zealous anti-Communist crusader in America's covert wars against the leftist Sandinista government in Nicaragua and the FMLN rebels in El Salvador. The high-level planning, money and arms for those wars flowed from Washington, but much of the on-the-ground logistics for the deployment of intelligence, arms and soldiers was run out of Honduras. US military aid to Honduras jumped from $3.9 million in 1980 to $77.4 million by 1984. So crammed was the tiny country with US bases and weapons that it was dubbed the USS Honduras, as if it were simply an off-shore staging ground. The captain of this ship, Negroponte was in charge of the US Embassy when, John Negroponte on CNN's Cold War. According to a 1995 four-part series in the Baltimore Sun, hundreds of Hondurans were kidnapped, tortured and killed by Battalion 316, a secret army intelligence unit trained and supported by the Central Intelligence Agency. As Gary Cohn and Ginger Thompson wrote in the series, Battalion 316 used "shock and suffocation devices in interrogations. Prisoners often were kept naked and, when no longer useful, killed and buried in unmarked graves." Members of Battalion 316 were trained in surveillance and interrogation at a secret location in the United States and by the CIA at bases in Honduras . . . Negroponte tried to distance himself from the pattern of abuses, even after a flood of declassified documents exposed the extent of US involvement with Battalion 316. In a segment of the 1998 CNN mini-series Cold War, Negroponte said that "some of the retrospective effort to try and suggest that we were supportive of, or condoned the actions of, human rights violators is really revisionistic." PAUL O'NEILL FINANCIAL TIMES: By making controversial proposals - [Paul] O'Neill backs the abolition of taxes on business - the Treasury secretary signals that the administration feels itself stronger than before, and is now ready to tackle larger problems. For starters, Mr. O'Neill says, it is time to review the purpose of taxation. Rather than seeing it as a simple mechanism to raise revenue, America must ask why it exists. It must also challenge progressive taxation, something no Republican administration has done before in a serious way. It must ask "how much money we the people as a collective group need to extract from each other to pay for public goods and services". National defense is a federal responsibility, says Mr. O'Neill, but all other outlays need review. Mr. O'Neill would include America's entitlement programmers for senior citizens in his survey. Currently, the government guarantees pensions and senior healthcare. Mr. O'Neill questions this guarantee, the roots of which lie in Roosevelt's New Deal. "Able-bodied adults should save enough on a regular basis so that they can provide for their own retirement and, for that matter, health and medical needs," he says . . . Mr. O'Neill "absolutely" backs the abolition of taxes on corporations. Instead, he says, the tax burden should be shifted to the individual. MORE JULIAN BORGER, GUARDIAN: The Bush administration's generous tax-cut plans were put into perspective when it was reported that the new treasury secretary, Paul O'Neill, earned more than $56 million last year as chairman of Alcoa Inc., the giant aluminum corporation . . . The cabinet is a veritable tycoons' club with seven of its members owning assets worth more than $10 million. Eleven of the remaining 12 are millionaires . . . The president has assets valued at $11 million - $21 million, including a sizable Texas ranch. Much of that money was made while he was a manager and share owner of the Texas Rangers baseball team, which benefited greatly from state funding of its stadium. . .THE BUSH CABINET thus bests Clinton, 77% of whose initial cabinet were millionaires, a presidential record at the time. JOHN POINDEXTER ||| JOHN SUTHERLAND GUARDIAN, LONDON - John M Poindexter had been appointed to head a new agency "to counter attacks on the US." . . . The agency which Poindexter will run is called the Information Awareness Office. You want to know what that is? Think, Big Brother is Watching You. IAO will supply federal officials with "instant" analysis on what is being written on email and said on phones all over the US. Domestic espionage. You want to test it out? Text-message any American friend, "Bmb OK. Allah gr8." . . . Poindexter is frighteningly smart and very unscrupulous. He graduated top of his class at the Naval Academy in 1958 and went on to a PhD in physics at the California Institute of Technology . . . He is the model for Tom Clancy's hero, Jack Ryan. After the assassination attempt on President Reagan in 1981, Poindexter was called in to review White House security. Reagan was impressed and appointed him a national security adviser, in 1983, with the rank of vice-admiral. At this point, things started to go wrong. He and Oliver North were found to be up to their necks in the Iran-Contra (guns for hostages) scam, which blew up in 1986. Poindexter was charged and found guilty of conspiracy, obstruction of justice, and the destruction of evidence in 1990; this was overturned on appeal the following year. The case against them was that they meticulously wiped out 5,000 incriminating emails - but forgot about the back-up tapes. Even smart guys goof sometimes. Poindexter was also accused by a Costa Rican government commission of being involved in cocaine trafficking to raise funds for the contras, though this was never proved . . . Both North and Poindexter have gone on to do well. North has a radio chat program that rivals Rush Limbaugh in rightwing virulence. Poindexter was recruited by Syntek Technologies, a firm in bed with Darpa. His hand was back in the hi-tech cookie jar. As a company vice-president, Poindexter helped develop Genoa - an "intelligence mining, information harvesting" system designed to explore (clandestinely) large computer databases. Listen in on America's electronic conversations, that is. MORE JOHN MARKOFF, NY TIMES - John M. Poindexter, the retired Navy admiral who was President Ronald Reagan's national security adviser, has returned to the Pentagon to direct a new agency that is developing technologies to give federal officials instant access to vast new surveillance and information- analysis systems . . . Mr. Poindexter, who is 65, was a controversial figure both for his role in the Iran- contra scandals and for his efforts to assert military influence over commercial computer security technologies. With Oliver L. North, a former National Security Council aide, Mr. Poindexter was convicted in 1986 as part of the guns-for-hostages deal that provoked a Congressional investigation. The conviction was overturned in 1991 on grounds that the men had been granted immunity from prosecution as a result of their testimony before Congress . . . As national security adviser, Mr. Poindexter was involved with a Reagan administration initiative in 1984 known as National Security Decision Directive, N.S.D.D.-145, which gave intelligence agencies broad authority to examine computer databases for "sensitive but unclassified information." In a later memorandum, Mr. Poindexter expanded this authority to give the military responsibility for all computer and communications security for the federal government and private industry. MORE COLIN POWELL [Back when Colin Powell was last in the news -- as a possible 1996 presidential candidate -- we proposed a few questions for him] - Who won the Gulf War? - If the answer is the US, then how come Saddam Hussein is still in power? - Well then, if that's the case, when exactly did Hussein stop being the "modern-day Hitler" as we were told at the time? - How many people did your troops kill during the Gulf war? - Why did we have to kill that many? - How many dead Iraqi draftees did your troops bulldoze into mass graves? - Wasn't the immolation of retreating Iraqi soldiers along the "Highway of Death" a bit excessive? - How many oil refineries were ignited by your own bombs? - How much radioactive material did you leave in the Iraqi desert? - How many civilians did our troops kill in Panama? - How many were buried in mass graves? - Is the sort of censorship, disinformation, and misinformation provided by the military during the Gulf war and Panamanian invasion what we could expect from a Powell presidency? - What differences are there between American-style democracy and the civilian operations carried out by the US military in places such as Panama, Kuwait and Somalia? - Which style of governance would your administration favor? - Describe the nature of your professional experience with each style of governance. - Why did you help to cover up allegations of a massacre of 400 Vietnamese at My Lai? - While in Vietnam what steps, if any, did you take to stop war crimes such as the shooting of unarmed civilians from US helicopters? - Why did Iran-Contra prosecutor Lawrence Walsh find your testimony in his investigation to be "at least misleading" although it "did not warrant prosecution?" - Describe your efforts to reduce the more than $30 billion in Pentagon "problem disbursements" i.e. money that was spent but the military can't figure who spent or authorized it to be spent. - Does the fact that about half the front-line troops in the Gulf War were from ethnic minorities reflect your concern for civil rights? - Why do you think it is that a higher percentage of American veterans than non-veterans are unemployed, homeless or imprisoned? - You have shown considerable interest in the Buffalo Soldiers. Discuss their role in the ethnic cleansing of native Americans by the US military. - You urged military men to resign if they also opposed Clinton's policy on gays in the military. Name one or more other issues in which you expressed public opposition to your commander-in-chief? - Are you at all concerned about the growing intrusion of the military into democratic American life -- including law enforcement? Discuss. - What can you tell us that would reassure that in voting for you we would not only put a military man in office but the military as well. -- Progressive Review, November 1995 POWELL AND MY LAI There may be isolated cases of mistreatment of civilians and POWs . . . This by no means reflects the general attitude throughout the Division . . . In direct refutation of this portrayal is the fact that relations between American soldiers and the Vietnamese people are excellent. - Colin Powell Excerpt from 1968 memo dismissing claims that there had been a massacre of civilians at My Lai. Powell issued this memo without having done any research into the matter. POWELL AND THE JROTC PROGRESSIVE REVIEW, March 1996: Much of the military's intrusion [into civilian affairs under Clinton] has been accomplished without public notice. For example, the Pentagon has greatly expanded JROTC programs. Last year, the American Friends Service Committee found retired military personnel teaching approximately 310,000 students, ages 14 and up, in about 2200 high schools (with another 700 on the docket). As the AFSC pointed out: "Public schooling strives to promote respect for other cultures, critical thinking and basic academic skills in a safe environment. In contrast, JROTC introduces guns into the schools, promotes authoritarian values, uses rote learning methods, and consigns much student time to learning drill, military history and protocol, which have little relevance outside the military. It pays off, though, for the Pentagon. Although the JROTC denies it is engaged in recruiting, 45% of all cadets completing the program sign up, mostly as enlisted personnel. AFSC also found that JROTC programs are more often found in schools with a high proportion of non-white students -- now providing 54% of all cadets -- and in non-affluent schools." And what are these cadets being taught? Says the report: "A comparison of the JROTC curriculum and two widely used civilian high school civics and history textbooks demonstrates that the JROTC curriculum falls well below accepted pedagogical standards. Units on citizenship and history are strikingly different from standard civil texts on these subjects. For example . . . the JROTC text portrays citizenship as being primarily achieved through military service, provides only a short discussion of civil rights; and downplays the importance of civilian control of the military. . . . In comparison to the civilian history text, historical events in the JROTC curriculum are distorted . . History is described as a linear series of accomplishments by soldiers, while the progress engendered by regular citizens is marginalized. America's wars are treated as having been inevitable. While it claims to provide leadership training with broad relevance, in fact the JROTC curriculum defines leadership as respect for constituted authority and the chain of command, rather than as critical thinking and democratic consensus-building . . . Finally, the text encourages the reader to rely uncritically on the military as a source of self-esteem and guidance." Further, at a time that schools are trying desperately to discourage violence, the JROTC is teaching students how to kill more effectively. It is also teaching them -- in a text that addresses the "Indian menace" that "Fortunately the government policy of pushing the Indians farther West, then wiping them out, was carried out successfully. " And just where did the idea come from for the expansion of military indoctrination in our high schools? From none other than that very media model of a major modern general -- Colin Powell. Following the LA uprising in 1992, writes Steven Stycos in the Providence Phoenix, the chair of the Joint Chiefs of Staff "proposed a massive expansion of the program. Powell urged the new units be targeted to inner-city youth as an alternative to drug use and gang membership." In New England the number of students involved nearly tripled. Was Powell seeking citizen officers to balance the academy-trained military? Absolutely not. The JROTC students are grunt-fodder. Besides, while referring to ROTC as "vital to democracy," Powell closed 62 college-based ROTC units during this same period. The inevitable result was that the proportion of academy-trained officers rose and the role of the citizen-officer diminished. You may recall that Powell was the man whom the media pushed for president, depicting him as in the mold of Dwight Eisenhower. The media forgot to tell us that while Eisenhower warned of a growing military-industrial complex, Powell has been one of its biggest beneficiaries and boosters. While Eisenhower fought to restore democracy, Powell fought to preserve sheikdoms. While the Eisenhower-era military followed the wartime orders of strong civilian leaders like Churchill and Roosevelt, the Powell-era military won't even follow Bill Clinton's orders in peacetime. While Eisenhower was part of a unique military demobilization after the Second World War, Powell was among those who prevented demobilization after the Cold War. On top of which he wants kids to know that the Indians were a menace. NEW REPUBLIC: Powell's career began as an Army Ranger during the Vietnam War. As Deputy Assistant Chief of Staff for Operations at a base in Vietnam, he was ordered to investigate claims of Army massacres at My Lai (where US forces murdered hundreds on March 16, 1968 - Powell had no involvement with that tragedy). Powell's cosmetic "investigation" of allegations by Tom Glen, who knew about the slaughter, claimed that his charges were false since Glen's superiors stated that he could not have witnessed abuses of Vietnamese. It wasn't until many months later that another soldier, Ron Ridenhour, complained to his Congressman, that serious inquiries into the My Lai massacre began within the Army, at Washington headquarters. -- The New Republic, April 17, 1995 MARK ROBINOWITZ: Just before leaving office, President Bush pardoned Casper Weinberger, preventing any prosecution for his involvement in the illegal arms for hostages deals. This act was one of the best things for Powell's future political career, since he was deeply involved in the scandal. There will never be a trial of his former boss, Defense Secretary Weinberger, where he'd have to testify. The US aided both Iran and Iraq during their 8-year long war, in which one million people died. No one knows how many thousands were killed with the 2,000+ missiles Powell helped send to Iran. NATIONAL SECURITY ARCHIVE: Weinberger testified before the [Senate Select] Committee [on Intelligence] that later that day he received a call from Poindexter informing him of the President's action [to send weapons to Iran]. Weinberger ... instructed military aide, Major General Colin Powell, to arrange the transfer of the weapons ... to the CIA, and that the matter was to be closely held at the direction of the President. General Powell had had previous discussions with North about the program and about Israel's problems in getting replacement TOW's [missiles]. .... According to [Assistant DOD Secretary] Armitage and a CIA official, Powell worked with Major General Vincent Russo of the Defense Logistics Agency to provide the material securely and without any loss of funds for the Army. -- The National Security Archive, "The Chronology: The Documented Day-by-Day Account of the Secret Military Assistance to Iran and the Contras," Warner Books, 1987, p. 262 JANE MAYER AND DOYLE MCMANUS: Weinberger reluctantly ordered his military aide, Major General Colin L. Powell, to arrange the sale of TOW's for North's new deal." -- "Landslide: The Unmaking of the President 1984-1988," p. 197 MARK ROBINOWITZ: After Powell became Reagan's National Security Advisor, he threatened to cut off US aid to any Central American country that refused to support the US-backed Contra war against Nicaragua . . . In December 1989, while Powell was Joint Chiefs of Staff -- the top military leader for all US forces -- George Bush invaded Panama in an attack condemned by almost every other country on Earth. Portrayed as a "surgical strike" on Manuel Noriega, it did virtually nothing to stem the flow of drugs into the US. (Noriega's replacements installed by the US Southern Command were also linked to the profitable drug trade.) CENTRAL AMERICAN HUMAN RIGHTS COMMISSION: The US Army used highly sophisticated weapons--some for the first time in combat--against unarmed civilian populations . . . The human costs of the invasion are substantially higher than the official figures . . . The actual death toll has been obscured through US military practices including: 1) Incineration of corpses prior to identification; 2) Burial of remains in common graves prior to identification; and 3) US military control of administrative offices of hospitals and morgues, permitting the removal of all registries to US military bases . . . A thorough, well- planned propaganda campaign has been implemented by US authorities to ... deny the brutality and extensive human and material costs of the invasion. MARK ROBINOWITZ: Powell, as Joint Chiefs of Staff, presided over the bloody Persian Gulf war. John Lehman, Reagan's first Navy Secretary, reportedly confided in 1991 at a gathering at the "Bohemian Grove" (an all-male retreat for corporate and political leaders in northern California) that 200,000 people were killed in the Gulf War . . . US forces bulldozed Iraqi draftees into mass graves, bombed retreating forces on the "Highway of Death," set oil refineries on fire, dropped uranium tipped shells across the desert (over 40 tons of radioactive uranium was scattered), and threatened to use nuclear weapons before the conflict started. But, since strict Pentagon censorship prohibited virtually any photographic documentation of the slaughter, Americans who only watched TV never learned what happened in the desert . . . Powell claims that he never received an illegal order during his military career, but orders to bomb civilians in Iraq and Panama (among many other locations) certainly could be classified as war crimes, which Powell should have refused to carry out under both the Uniform Code of Military Justice (which mandates that soldiers refuse illegal orders) and the Nuremberg Principles. Instead, Powell's only documented opposition to any policy was about Clinton's efforts to end anti-gay witchhunts in the military -- Powell urged military men to resign if they also opposed Clinton's policies. MICHAEL POWELL REUTERS: New Federal Communications Commission Chairman Michael Powell named Walt Disney Co. executive Marsha MacBride as the agency's new chief of staff. MacBride served as a vice president in Disney's Washington office, which was heavily involved in lobbying the FCC to place strict conditions on the America Online-Time Warner combination which was concluded earlier this month. She has served in various capacities at the FCC for roughly 10 years, including as a legal advisor to Powell on mass media and cable television issues . . . Disney urged the FCC, as well as antitrust authorities, to require AOL-Time Warner to allow consumers access to whatever content they choose regardless of the provider and not limit the interactive nature of content from rival companies. The FCC and Federal Trade Commission approved the combination with conditions, including one by the FTC that prevents the new company, now AOL Time Warner Inc., from interfering with content from rival providers. OTTO REICH JASON VEST, AMERICAN PROSPECT: Part of the problem with naming [Otto] Reich to State is that while diplomacy can be, and sometimes is, conducted quietly, it is not the same as covert action, which has a tendency to either (a) be abused by those who find it more expedient, or (b) complicate policy situations through unnecessary subterfuge or the creation of unintended consequences. Lest one think that Reich has moved past this proclivity for spinning from the shadows, Reich still seems a proud propagandist at heart, particularly on an issue of great concern throughout this hemisphere: sweatshops. If you point your web browser to www.wrapapparel.org, you'll find the homepage of what appears to be a group devoted to championing the oppressed and exploited worker. The Worldwide Responsible Apparel Production program bills itself as an independent, non-profit effort to certify that the clothes you wear were produced under humane and legal conditions, and proudly trumpets the vita of its vice-chairman, "Ambassador Otto Reich." WRAP is, in fact, a creature of the American Apparel Manufacturers Association, and according to Terry Collingsworth, an attorney with the International Labor Rights Fund, it was "set up as an industry dominated monitoring project as a cover to avoid legitimate monitoring. It's a dodge, and is so regarded by everyone except the industry." The National Labor Committee's Charles Curnahan goes further, calling it "the worst, the lowest you can go" of industry-backed "rights" groups, but says that he wasn't surprised to find Reich near the top of WRAP's board. "Given the work he did in the Office of Public Diplomacy," he says, "this isn't too much of a stretch -- it's the same thing: propaganda and psychological warfare." . . . In the view of Larry Birns, the head of Washington's Council on Hemispheric Affairs, the combination of Reich's hard-line views, current business connections, and Iran- Contra past would make him a disastrous choice to be the United States' point person for Latin America. "It would be of interest to anticipate the violent polemical struggle between Fortune 500 U.S. multinationals, most of whom denounced Helms-Burton for interfering with trade with Cuba, and the State Department's Latin American office under an ideologically driven Reich." . . . "If confirmed, [Reich's] tenure will inevitably be littered with hemispheric vendettas, abusive run-ins with strong-willed regional leaders, and a cheerful indifference to state department rules and regulations," Birns says. "During his years in the public sector, Reich seemingly has found it against the very marrow of his personality and basic nature to be able to walk down a straight path.” MORE PAUL DE LA GARZA & DAVID ADAMS, ST. PETERSBURG TIMES: In a bow to conservatives, his brother and the Cuban-American community in Florida, President Bush nominated a controversial figure from the Reagan White House to a top State Department post with responsibility over Cuba policy. The selection of Otto J. Reich, a Cuba hard-liner, for assistant secretary of state for western hemispheric affairs sets the stage for an acrimonious battle during his Senate confirmation. A former ambassador to Venezuela, the Cuban-born Reich played a role in the Iran-Contra affair, the Reagan administration's most embarrassing foreign policy initiative . . . He was a key figure in prohibited, covert propaganda activities in the United States designed to discredit the Marxist government of Nicaragua. In his current role as a lobbyist, he has worked for companies that benefit from the American embargo on Cuba, which he helped tighten . . . From the summer of 1983 until late 1986, Reich ran a controversial government office designed to generate American public support for the US-backed war in El Salvador and for the U.S.-backed Contra rebels in Nicaragua. In 1987, the U.S. comptroller general found that Reich and associates in the Office of Public Diplomacy for Latin America and the Caribbean waged a media campaign supporting the Contra rebels. An internal Public Diplomacy memo said the goal was to "concentrate on gluing black hats on the Sandinistas and white hats" on the Contras. The office relied on Army psychological-warfare specialists and was accused of smearing US journalists the administration found especially critical of its Central America policy. In a 1985 interview with New York magazine, Reich said reporters were having sexual relations with heterosexual and homosexual Sandinista agents in exchange for favorable coverage. ROBERT REILLY - Robert Reilly in 1981 to head of U.S. Information Agency: "It is time we recaptured the words 'balance' and 'objectivity' from the rhetorical excesses of the left and reestablished them to stand for the full truth about this country - the last and best hope for freedom in the world." - 1996 National Review article: "Only the act of sodomy differentiates an active homosexual from a heterosexual . . . The homosexual rationalization is so successful that even the campaign against AIDS is part of it, with its message that 'everyone is at risk.' He now says, "I find it personally and morally repugnant to discriminate against someone because they're a homosexual. . . I would avidly enforce the anti-discrimination statutes that apply in this position." - Wrote that the Supreme Court decision legalizing abortion, "has given impetus to the process of the rebarbarization of man in the 20th century." JOHN WALTERS MIKE MALES, ALTERNET: John Walters is a veteran of drug policy shambles. As the deputy director under former drug czar William Bennett, he helped craft drug war policies that have shattered millions of lives, wasted billions of dollars and exacerbated America's drug crisis. He's a hard-core ideologue who misrepresents the facts and spouts tough-on-crime rhetoric . . . ONDCP's goals, established in Bennett's 1989 National Drug Control Strategy when Walters was his deputy director, specifically targeted drug "use itself," not abuse or addiction. Policies stigmatized and punished "casual users ... because it is their kind of drug use that is most contagious." Conversely, the strategy de-emphasized treating addiction because drug addicts are "a mess" who "make the worst possible advertisement for new drug use." Bennett's strategy of neglecting drug abusers while punishing casual users worked exactly as designed. In the 1980s and early 1990s, arrests and imprisonments for drug law violations skyrocketed, self- reported drug use fell and drug abuse exploded. Federal Drug Abuse Warning Network reports showed overdoses and hospitalizations skyrocketing, especially for those drugs most targeted by the drug war. In 1980, when Reagan took office, 28,000 Americans were hospitalized for abuse of heroin, cocaine and methamphetamine. In 1992, when Bush left office, the number was 175,000. In 2000, the latest figures available, 250,000. THEODORE OLSON It's easy to imagine an infinite number of situations where the government might legitimately give out false information. It's an unfortunate reality that the issuance of incomplete information and even misinformation by government may sometimes be perceived as necessary to protect vital interests. - Solicitor-General Theodore Olson, speaking to the Supreme Court THE LIST: DSL Dubya as a Second Language 1. Vocabulary Barriffs: barriers Cuff Links: handcuffs Grecians: Greeks Inebriating: enthralling Obscufate: obfuscate Pillared: pilloried Preservation: perseverance Presumptive: presumptuous Slovokian: Slovenian Subscribe: ascribe Subsidation: Subsidization Tacular weapons: tactical weapons Tenants: tenets Terriers: tariffs Vile: viable Vulcanize: balkanize 2. Grammar More and more of our imports come from overseas, You teach a child to read and he or her will be able to pass a literacy test. - President Bush at Townsend TN Elementary School Well, I think if you say you're going to do something and don't do it, that's trustworthiness. -- Aug. 30, 2000. Laura and I really don't realize how bright our children is sometimes until we get an objective analysis. I was raised in the West. The west of Texas. It's pretty close to California. In more ways than Washington, DC, is close to California Reading is the basics for all learning I understand small business growth. I was one. The senator has got to understand if he's going to have - he can't have it both ways. He can't take the high horse and then claim the low road, If you're sick and tired of the politics of cynicism and polls and principles, come and join this campaign. How do you know if you don't measure if you have a system that simply suckles kids through. We ought to make the pie higher. I think we need not only to eliminate the tollbooth to the middle class, I think we should knock down the tollbooth. The most important job is not to be governor, or first lady in my case. Will the highways on the Internet become more few? I know how hard it is for you to put food on your family. This is still a dangerous world. It's a world of madmen and uncertainty and potential mential losses. Rarely is the question asked: Is our children learning There needs to be debates, like we're going through. There needs to be town-hall meetings. There needs to be travel. This is a huge country. When I was coming up, it was a dangerous world and you knew exactly who they were. It was us versus them and it was clear who them was. Today we are not so sure who the they are, but we know they're there. This is Preservation month. I appreciate preservation. This is what you do when you run for president. You've got to preserve." -- To several hundred children at an elementary school in Nashua that was celebrating what it called Perseverance Month (not Preservation Month). What I'm against is quotas. I'm against hard quotas, quotas that basically delineate based upon whatever. However they delineate, quotas, I think, vulcanize society. Tell them I have learned from mistakes I may or may not have made. 3. Style I mean, these good folks are revolutionizing how businesses conduct their business. And like them, I am very optimistic about our position in the world and about its influence on the United States. We're concerned about the short-term economic news, but long-term, I'm optimistic. And so, I hope investors, you know -- secondly I hope investors hold investments for periods of time -- that I've always found the best investments are those that you salt away based on economics." -- Jan. 4, 2001. I am mindful of the difference between the executive branch and the legislative branch. I assured all four of the leaders that I know the difference, and that difference is they pass the laws and I execute them." -- Dec. 18, 2000. The Legislature's job is to write law. It's the executive branch's job to interpret law." -- Nov. 22, 2000. Natural gas is hemispheric. I like to call it hemispheric in nature because it is a product that we can find in our neighborhoods." -- Dec. 20, 2000. PROGRESSIVEREVIEW THE CORPORADOES INDEX UNDERNEWS MAIL US earlier stories SEP 2002 DONNA MILLSAP OREGON HERALD - Regal Cinemas, by their own words, the "largest cinema chain in the world," is forcing customers to view ads to help pay their bills. Our investigation indicates Oregon customers, by a large majority, do not wish to view any advertising in any form when they pay for entertainment. Regal employees, confused and obviously uneducated in at least this area, have no good answers and management refuses comment. The real problem, in addition to having to pay for ads, is not knowing when the film will begin. Will there be previews, will the movie begin on time? . . . The Cinema Billboard Network, which is a division of Screenvision Cinema Network, boasts: "We have a captive audience watching your advertisement. No interruptions! The patrons sitting in the theaters are not going anywhere." Not all movie companies allow ads before their movies. The general counsel to Buena Vista, which distributes Disney movies, explained in 1990 why Disney generally prohibits advertising in theaters before its movies: "We do not believe people should be held hostage to unavoidable commercials in theaters any more than on their telephones." According to the Los Angeles Times, New Line Cinema and Warner Bros. don't allow in-theater advertising before their films. GRETCHEN MORGENSON with ANDREW ROSS SORKIN, NY TIMES - Tyco International agreed to pay a severance package of $44.8 million in cash to Mark H. Swartz, its chief financial officer, while he was under investigation by a grand jury in Manhattan that later indicted him on fraud charges. A copy of the Aug. 1 agreement was obtained yesterday from a person close to the investigation of Mr. Swartz and L. Dennis Kozlowski, Tyco's former chief executive. It was approved on Aug. 14 by two board members serving on Tyco's compensation committee. The amount paid to Mr. Swartz was not disclosed to shareholders, though the complex formula that Tyco used to devise his exit agreement was outlined in a document attached to its most recent quarterly filing. DAN GILLMOR, SAN JOSE MERCURY NEWS - Jack Valenti says he and his movie-industry employers are all for compromise in the copyright wars. But the solutions they advocate for an admittedly tough dilemma, copyright infringement, are grossly one-sided. . . In fact, the entertainment cartel has in recent years grossly tipped the balance. Spending millions of dollars on campaign contributions and lobbying, it has persuaded Congress to enact laws reflecting a radical view of information and its use. The major media/entertainment companies believe that control of information -- absolute control over how it can be used -- belongs to the owner of the copyright. They insist, moreover, that copyrights should be able to last indefinitely. This is not a compromise, no matter what Valenti calls it. This is a radical agenda, one that overturns tradition and would ultimately wipe out the public domain, without which our culture would be vastly poorer. ERIN MADIGAN, STATELINE - For a Kansas-based Web company electronic government is turning into big business, as cash-strapped state governments search for ways to fund online services. NIC (National Information Consortium) builds and manages government Web sites by charging user fees for access. The publicly held company has operated Indiana's state government Web site since 1995, and currently does business with eight local and 16 other state governments. Other NIC clients include Idaho, Iowa, Kansas, Hawaii, New Hampshire and Utah. Of these 17 states, 14 charge fees so only taxpayers that use the service cover the cost. . . Critics say charging fees denies some individual users or organizations needed and readily accessible state services. . . Darrell West, director of the Center for Public Policy at Brown University and author of a new study on state and federal e-government, is concerned subscriber fees could stop poor residents or those who live in rural areas from gaining access to certain services on state Web sites. QUESTION OF THE DAY What president cut taxes four times, reduced the national debt by a third, and reported budget surpluses every year in office? ANSWER OF THE DAY Calvin Coolidge. Not too many months after he left the White House, the country was plunged into a depression -- something that has happened every time America has significantly reduced its national debt. IS THE MARKET BEING RIGGED? John Crudele of the New York Post points to big purchases of index futures at stock market crisis moments as evidence the government may be manipulating what happens on Wall Street. He writes that in 1989 a member of the Federal Reserve Board, Robert Heller, suggested just such a tactic. Writes Crudele: "Essentially, whenever there is heavy buying of these futures contracts it causes the underlying stock market to rise. The futures contracts can be bought cheaply; they are highly leveraged so you get more bang for each buck, and they eliminate the need for a rigger to purchase, say, all 30 stocks that make up the Dow. Heller explained that the process was simple. And it is. The trouble is, the government never has had authority to rig the stock market. . . . Take last Thursday, when the Dow was down more than 200 points and the House was passing a resolution to investigate the President of the United States. Exactly when the debate was going on in Congress, the S&P 500 futures contracts shot up in price like someone needed a market rally awfully bad." Review, 1998 MBA BRAINS FOUND SIMPLE ENOUGH FOR COMPUTER TO ASSESS Confirming anecdotal evidence about America's managerial class, the Educational Testing Service has announced that a computer will replace one of the humans formerly used to evaluate essay answers on the Graduate Management Admissions Test. According to the Washington Post, the computer program, based on previous successful answers, will "search for vocabulary and syntactic structure to find key words and phrases as evidence of a 'good argument.' Although a human evaluator will also check the work, the plan assumes that a computer can find the words "bottom line" and "outside the box" as well as a real person. - 1998 Economics Affects The Poor's Life-Span More Than Drinking, Smoking, Lack Of Exercise A study in the Journal of the American Medical Association, reports that the poor have a death rate 2.77 times higher than that of other Americans -- even when smoking, drinking alcohol, overeating and lack of exercise are accounted for. These factors are responsible for about 13% of the low income death rate. Even Americans making between $10,000 and $29,000 had a death rate 2.14 higher than those earning $30,000 plus after subtracting the effect of harmful habits. And while the poor having greater smoking and weight problems, contrary to common perception they drink less than wealthier groups of Americans. Sixty percent of the poor don't drink at all compared to 31% of those earning $30,000 or more. The study was funded by the National Institute on Aging and the Robert Wood Johnson Foundation. - 1998 LISA GIRION, THE LOS ANGELES TIMES - In a setback for multinational corporations, a federal appeals panel ruled that such companies can be held liable in U.S. courts for aiding and abetting human-rights violations committed abroad. The ruling, which the panel said was unprecedented, came in a case that accuses El Segundo, California-based Unocal Corp. of turning a blind eye to alleged human- rights abuses, including murder and rape, against Burmese villagers who were forced by Myanmar government soldiers to work on a $1.2 billion natural-gas pipeline. The decision by a panel of the 9th U.S. Circuit Court of Appeals in Pasadena, California, was seen as a breakthrough for foreigners seeking to hold multinational corporations accountable for their alleged complicity with repressive foreign regimes in human-rights abuses. At least ten similar lawsuits are pending around the United States against corporations, including Chevron- Texaco and Coca-Cola, and human-rights lawyers have several other cases waiting in the wings. JOHN M. BRODER, NY TIMES - Widespread power failures during California's energy crisis of 2000 and 2001 could have been avoided if five independent energy companies had not withheld electricity they were capable of producing, a study by state regulators said today. The investigation by the California Public Utilities Commission said the five companies - Duke, Dynegy, Mirant, Reliant and AES/Williams - had withheld power from their California plants. This contributed to the "unconscionable, unjust and unreasonable electricity price spike that California experienced during the energy crisis," the report said. The commission did not directly accuse the companies of deliberately trying to drive prices up. Officials said investigations were continuing into possible price manipulation and collusion among the companies. FEBRUARY 2002 ||| JOHN BRESNAHAN & DAMON CHAPPIE, ROLL CALL - In early 1998, Enron Corp. secured a $750,000 contract for political operatives tied to House Majority Whip Tom DeLay (R-Texas) to secretly conduct an aggressive grassroots campaign pushing energy deregulation, according to documents obtained by Roll Call and interviews with individuals involved with the effort. The contract was awarded after DeLay personally recommended to Enron officials that they hire the team of strategists who make up the inner circle of his political and fundraising machine. In a January 1998 meeting at his home in Sugarland, Texas, DeLay reviewed plans to have Enron bankroll a new grassroots operation to jump-start the deregulation debate with three of his operatives MORE ||| TAMARA LYTLE, ORLANDO SENTINEL - A Wall Street money-management firm was busy buying millions in plummeting Enron stock on behalf of Florida's pension fund last year at about the same time it was advising the state of New York to sell its shares. U.S. Sen. Bill Nelson, D-Fla., said that he wants to know why Alliance Capital Management had such bad advice for Florida's pension fund for teachers, state and local workers while recommending the opposite for New York's. Florida lost more than $300 million on its Enron investments - more than any other state . . . Alliance Capital has come under fire because one of its executives, Frank Savage, also sat on the board of directors of Enron. Critics say that presented a conflict of interest and that Savage should have warned Alliance Capital's investors when he discovered the precarious state of Enron's finances. Florida has since fired Alliance Capital and is considering suing the company. MORE ||| ENRON INFORMATION LINE: Even if you don't have a question, the number is worth calling. 1-213-213-6070 [DAVID MARTIN, an independent investigator who has previously done work on the Vince Foster mystery and other cases, sent $25 to the Office of the Medical Examiner of Harris County, Texas and obtained a notarized copy of the autopsy of former Enron executive, J. Clifford Baxter. Here are some of things Martin found in it.] ||| DAVID MARTIN, GREAT SPECKLED BIRD - 1. Although the "Manner of Death" on page 1 is given as "suicide," no effort is made in the autopsy to support that conclusion, and, indeed, there is no supporting evidence for suicide in the autopsy. The conclusion could only have been reached based upon something extraneous to the autopsy. 2. The strongest evidence in the autopsy report is most consistent with murder. Under EVIDENCE OF INJURY on page 3 we find, "The defect is stellate and, when the wound edges are repositioned, measures 7.2 centimeters in the horizontal direction and 4.5 centimeters in the vertical direction." This suggests a wound inflicted by a starburst of rat shot pellets which were far enough from the muzzle of the weapon to have separated from one another by as much as 2.83 inches before striking the head. Who would, or could, shoot themselves in the temple like this? A friend of mine has consulted with a technician at CCI Ammunition, a company that makes .38 caliber rat shot charges like the one apparently causing the death of Baxter. The technician says that a general rule of thumb is 1 inch of spread for every one foot of distance between the gun muzzle and the target. That suggests that the gun would have been between two and three feet from Baxter's temple when it was fired, a rather peculiar way for someone to shoot himself. Maybe Baxter wanted to give himself a sporting chance. In the paragraph above the EVIDENCE OF INJURY we read that "The palmar surface of the left hand is remarkable for an irregular, red, recent abrasion occurring at the base of the fifth digit, which measures 1/4 inch along the linear axis. There is an irregular abrasion on the palmar surface of the distal phalanx of the fifth digit, which measures 1.5 centimeters. This injury consists of discontinuous superficial abrasions with a trail of black material." Such an injury, though very slight, is not consistent with Baxter having shot himself while seated in his car. Rather, it suggests that he had recently fallen to his left (consistent with being shot in the right temple) and attempted to break to fall by extending his left hand, perhaps on an asphalt road. The black material should have been tested to see what it is, but apparently it was not. 3. The car was much nearer to the house than news reports have indicated, for what that might be worth. As in the original Houston Chronicle report, the autopsy report says Baxter was found in his car in the 5200 block of Palm Royale Boulevard. We learn for the first time here, though, that his home was at 5211 Palm Royale Boulevard. He was less than a block from home, and could have been in front of his own house. 4. His dress, workout pants and a t-shirt, are most consistent with his having just ventured out from his house rather than his having been out in some public place. MORE ||| REUTERS - The Houston Astros smacked the disgraced Enron Corp. right out of their ballpark, buying back the naming rights for the stadium from the fallen energy trader for $2.1 million. The park born in 2000 as Enron Field for now will be called Astros Field until the baseball club can find a new buyer for the naming rights. The two parties agreed to the deal before a scheduled hearing on the matter in a U.S. Bankruptcy Court in New York set for later on Wednesday. Enron in 1999 agreed to pay $100 million to put its name on the stadium for 30 years. Wednesday's deal nullifies the remaining 27 years of the naming rights contract, and gives Enron some much-needed cash. MORE ||| PETER ASMUS, GREENBIZ - One of the few energy-related assets Enron maintained was its wind-turbine-manufacturing subsidiary, Enron Wind Corporation. Even though wind power has been the fastest-growing power supply source over the past decade, Enron had been trying to sell its wind unit for more than a year. Enron seemed oblivious to the true value of the United States' last major wind company. Or perhaps it just viewed a company whose revenues grew from $50 million in 1997 to $750 million in 2001 as a source of cash to shore up its shaky financial footing . . . To its credit, Enron supported curbing emissions to global climate change. Yet the firm failed to recognize that the value of one of the few energy-related hard assets it owned - Enron Wind Corp. - showed tremendous profit potential due to global climate change concerns. "We are one of the top three wind turbine manufacturers in each of the top three world wind power markets: the United States, Germany, and Spain," said Adam Umanoff, CEO and president of Enron Wind Corporation. Among those interested in Enron Wind, which is not part of the bankruptcy proceeding that has engulfed its ailing corporate parent, is UBS Warburg of Great Britain. If snatched up by a European firm, the billions of U.S. dollars in private and public sector capital invested into wind technology will have failed to sustain even one major domestic wind turbine manufacturer . . . MORE ||| CHRISTOPHER STERN WASHINGTON POST - During 2000 and 2001, a period when Global Crossing Ltd.'s stock was falling along with demand for its international telecommunications network, 14 company insiders sold more than $482 million worth of shares in the firm. Global Crossing chairman and founder Gary Winnick reaped the biggest gains over those two years - a total of more than $280 million, according to figures provided by Thomson Financial/Lancer Analytics . . . Winnick and other company officials have defended the sales, saying the transactions were fully disclosed to investors and others as part of Global Crossing's routine reports to federal regulators. But the sales were made during a period now under scrutiny by the Securities and Exchange Commission and the FBI. The agencies are looking into charges that the company, which filed for bankruptcy protection last month, reported inflated revenue numbers in an effort to mislead investors, creditors and regulators about its financial condition. MORE ENRON [From testimony before a House committee by Enron Vice President Sherron Watkins. Watkins is being asked by Rep. Greg Ganske about her memo to Kenneth Lay warning him of massive financial irregularities in the company's accounts.] GANSKE: Did you keep a copy for your own personal files? WATKINS: Yes, I did. Yes, I did. GANSKE: And where did you keep those files? At home? WATKINS: No. GANSKE: At work? WATKINS: No, in a lockbox. GANSKE: In a lockbox. So you were enough concerned about this that you wanted to put this somewhere where it couldn't be destroyed. WATKINS: Yes. GANSKE: Were you worried about your own personal safety? WATKINS: At times, I mean, just because the company was a little bit radio-silent back to me, so I didn't know how they were taking my memos or the investigation. GANSKE: Why would you be worried about your personal safety? WATKINS: Because it was the seventh-largest company in America. GANSKE: And you were dealing with a really powerful person- WATKINS: Yes. GANSKE: . . . and a really powerful company. DERIVATIVE AMERICA & THE ENRON GENERATION THE word from the Secretary of State that what this country really needs is "rebranding" provides further confirmation that America itself has become a derivative, a socio-political version of those financial instruments Roy Davis has described as having "no intrinsic value, but derive their value from something else . . . The job of a derivatives trader is like that of a bookie once removed, taking bets on people making bets." John Maynard Keynes explained it more than 60 years ago: "'Professional investment may be likened to those newspaper competitions in which the competitors have to pick out the six prettiest faces from a hundred photographs, the prize being awarded to the competitor whose choice most nearly corresponds to the average preferences of the competitors as a whole; so that each competitor has to pick, not the faces which he himself finds the prettiest, but those which he thinks likeliest to catch the fancy of the other competitors, all of whom are looking at the problem from the same point of view. It is not a case of choosing those which, to the best of one's judgment, are really the prettiest, nor even those which average opinion genuinely thinks the prettiest. We have reached the third degree when we devote our intelligences to anticipating what average opinion expects the average opinion to be. And there are some, I believe, who practice the fourth, fifth and higher degrees.'" Since the rise of metastatic media and mass mood manipulation, America has become similarly removed from the first degree of itself. The process described by Keynes applies as well to politicians as it does to gold trading, witness Bill Clinton's weekly meetings with pollsters to determine what he should think and say over the coming days. Or consider the media, which now widely substitutes perceptions for news; features talk shows that offer perceptions of the validity of previous perceptions; and which, even when still reporting news, does so only after careful consideration of what the viewers want to see, which by definition bars anything that is new and thus news. Even war has become another degree of itself. War used to be something to win against an enemy that had a name. There were some relatively firm standards - such as a surrender - to indicate when that had occurred. Now we are told that we are in a war not against somebody but against a character flaw called evil doing, and that the war may not be over for 5, 10, or 50 years depending on who is talking about it. This, of course, is not really a war at all, but a new status quo that has been declared, one in which violence and paranoia and strip searches are not just part of a sacrifice one must make for a better future. They are the future. Thus have America's leaders become rogue traders of reality, creating derivatives of it for their own purposes at extraordinary risk to the rest of us, demanding that we bet our all on a psychic 401K that is invested only in megalomaniacal notions of foreign relations and in a dictator's notion of security. How has this happened? One reasonable hypothesis is that the character of Enron's management is not a perversion of elite values at all, but rather a revealing insight into what has occurred in the rest of society as well, including the media, academia, and politics. You even find it in the military, witness the current chair of the Joint Chiefs of Staff, General Richard Meyers, who actually says things like "facilitize" (a derivative of "facilitate" which is a derivative of "assist") and who excused the slaughter of 16 innocent Afghans by arguing that "the difference between a normal Afghan citizen and a Taliban is very thin," much as if he were a corporate representative explaining misdelivered order. The trend is particularly striking in politics. The last two administrations have been characterized by the invasive influence of an arrogant, autistic, and amoral class of late 20th century MBAs and similar members of the technocratic elite. This class has junked sixty years of social democracy, helped wreck the Russian economy, made every American worker a temp-in-waiting, carpet bombed the English language, trashed every moral concept in their way, and twisted reality so effectively they even convinced many that they were sex objects. And they are everywhere. You will find them running schools and universities and managing once great museums. They talk mush, think mush, market mush, report mush, and defend mush. They attempt to make up in certitude what they lack in wisdom; they can't tell the difference between a phrase and a product; and they create infantile and self-serving distortions of economic principles that they declare to be the only principles in life worth observing. They are, in the end, just so many more televangelists, but with themselves as God. Perhaps worst of all, they are without the capacity for shame. Like other sociopaths, they are remorseless. The fraud, the huckster, the salesman are not new phenomena in America; what is new is that they now so strongly control every estate of our society. Those of a nature that would have once caused Americans to close the door, hang up, or say "no thank you," now teach our children, run our government, and tell us what to think. They are the Enron generation, filled with postmodern versions of Willy Loman: "He don't put a bolt to a nut, he don't tell you the law or give you medicine. He' s a man way out there in the blue, riding on a smile and a shoeshine." America, in its first degree, made things people wanted, said things that needed to be said, and fixed things, including itself, that needed fixing. Now it is out there in the blue, riding only on a smile and a shoeshine. The problem, as Willy Loman discovered, comes "when they start not smiling back - that's an earthquake. And then you get yourself a couple of spots on your hat, and you're finished." - SAM SMITH ||| ASSOCIATED PRESS is reporting that Enron executives urged employees to invest all their retirement money in Enron stock, according to Rep. Henry Waxman who obtained a videotape of a company meeting. ||| MARK SHERMAN, ASSOCIATED PRESS - The nation's fourth-largest bankruptcy has gotten scant attention in Washington because it occurred around the same time as the largest. But like Enron, Global Crossing Ltd. was a major player in the capital. . . Global Crossing's campaign contributions have come in large chunks - unregulated soft money to both parties, favoring Democrats but not to the extent that Enron directed its money to Republicans. Lawmakers on key committees have been a focus. MORE ||| PATRICE HILL, WASHINGTON TIMES - The Clinton administration provided more than $1 billion in subsidized loans to Enron Corp. projects overseas at a time when Enron was contributing nearly $2 million to Democratic causes. Clinton officials refused to finance only one out of 20 projects proposed by the energy company between 1993 and 2000 to build power plants, natural-gas pipelines and other big-ticket energy facilities around the world, according to the Export-Import Bank and the Overseas Private Investment Corp., the agencies that provided the subsidies. In addition, the administration, which lauded Chairman Kenneth L. Lay as an exemplary "corporate citizen," granted about $200 million worth of insurance against political risks for nine Enron projects in such politically volatile areas as Argentina, Venezuela and the Gaza Strip, according to documents the agencies provided to the Senate Finance Committee. MORE ||| MARCY GORDON ASSOCIATED PRESS - Former Enron chairman Kenneth Lay offered a seat on the company's board in 1999 to Robert Rubin, who was then treasury secretary, and lobbied Rubin and his successor on issues affecting Enron, documents obtained show. The notes and letters show that Lay pressed Enron's interests to Clinton administration officials. Last month, the Bush administration disclosed a series of telephone calls from Lay - one of President Bush's biggest campaign contributors - to members of the Bush Cabinet as the company was sliding toward bankruptcy last fall. MORE ||| CARL LIMBACHER, NEWSMAX - The National Enquirer may finally be able to add some desperately needed spice to the otherwise enervating Enrongate scandal, with a report hitting newsstands Friday that claims the collapsed energy giant was knee-deep in wild sex parties and CIA espionage . . . Some highlights reported by NE: "Enron executives frequented several Houston strip clubs and billed thousands of dollars directly to the company - including a tab for VIP rooms where sexual favors were dispensed to big spenders. "Typically a group of five or six would come in for lunch, drink a few martinis and get private lap dances from the girls. They paid with credit cards that clearly said 'Enron' on them," a source at one of the clubs told the tabloid. "Anything goes in the VIP room. It isn't uncommon for the girls to provide sexual favors for big spenders. And a lot of these middle-aged Enron executives were some of the biggest spenders in the club. "Enron-sponsored parties would often spiral out of control with senior officials' bar tabs skyrocketing to over $10,000." . . . The story takes a cloak-and-dagger twist with the allegations that both the Clinton and Bush administrations signed off on CIA help for the corporate giant. "There have been at least 20 CIA agents on the payroll of Enron for the last eight years," a source familiar with several ongoing Enrongate probes told the tabloid. MORE ||| RUSSELL MOKHIBER & ROBERT WEISSMAN - Frank Easterbrook and Daniel Fischel are University of Chicago law professors who believe that, when it comes to making profits, nothing - not even the law - should stand in the way. (For almost two decades, Easterbrook has also been a federal appeals court judge.) Twenty years ago, writing about antitrust crimes in the Michigan Law Review, Easterbrook and Fischel, then both professors at the University of Chicago, wrote that managers not only may, but should, violate the rules when it is profitable to do so. And it is clear that they believed that this rule should apply beyond just antitrust. In a nutshell, this is the Chicago School view of corporate law that has taken hold over the past 20 years. Under this view, if a Fed Ex truck needs to double park to make a delivery - double park. No problem. Pay the $20 fine. Just as long as you are still making money, violate the law. Or course, when it comes to corporate crime and violence, we aren't talking about just double parking. We're talking about fraud, corruption, pollution, price-fixing, occupational disease, and bribery. The Chicago School says these are "externalities" and related fines and penalties should simply be viewed as the "costs of doing business." . . . Lawmakers of both parties are shamelessly portraying Enron and Arthur Andersen as rotten apples, even though those same lawmakers were just until recently on the take from both corporations, and doing the dirty work of defeating laws that would have governed both . . . As Easterbrook and Fischel so clearly show, the corporate world is now governed by an ideology that is rotten to the core. After all, as the great Chicago professors teach us, it is the duty of managers to violate the law when it is profitable to do so. MORE ||| GLOBAL CROSSING made big payments and forgave loans to executives even as it headed for bankruptcy court the Wall Street Journal reports. JOSEPH N. DISTEFANO, PHILADELPHIA INQUIRER: To manage its far-flung financial interests, avoid local taxes and shroud high-stakes deals from investor scrutiny, Enron Corp. organized a sprawling network of 2,000 corporate subsidiaries in 23 states and 62 countries. Hundreds of Enron units were set up in offshore tax havens such as the Cayman Islands; others were under the laws of Brazil, England and other places Enron did business, according to the bankrupt company's annual report. But the largest number of Enron subsidiaries - - 685, not counting duplicate names -- were set up in Delaware, where the creation and care of corporate entities is big business. The speed, secrecy and state tax exemptions offered by Delaware, along with its business-friendly courts, have long enticed everyone from blue-chip corporations to international gangsters. State officials say more than half of Fortune 500 and New York Stock Exchange companies are chartered there, and the General Accounting Office cites Delaware as a haven for foreign money launderers. You can start a Delaware company without going there. First, pick a Delaware-registered corporation agent. They advertise in magazine and on the Web. For just $85 in fees, you're in business. You don't need to open a bank account; disclose your profits, sales or purpose; or even give your name. Yearly fees of $50 to Delaware and another $100 or so to your agent will keep you there. GOING FOR THE GOLD IGNORED BY the stenographic media is the possibility that the Enron scandal may be eclipsed by other derivative-based disasters, most notably one involving the shaky gold markets. It has been left to concerned gold traders and market aficionados to blow the whistle on this crisis in the making. One exception in the press is Kelly Patricia O'Meara of Insight Magazine who writes in the current issue: "There are many in the world of high finance who aren't buying the official line and warn that Enron is just the first to fall from a shaky house of cards. Many analysts believe that this problem is nowhere more evident than at the nation's bullion banks, and particularly at the House of Morgan (J.P. Morgan Chase). One of the world's leading banking institutions and a major international bullion bank, Morgan Chase has received heavy media attention in recent weeks both for its financial relationships with bankrupts Enron and Global Crossing Ltd. as well as the financial collapse of Argentina . . . "In recent years Morgan Chase has invested much of its capital in derivatives, including gold and interest-rate derivatives, about which very little information is provided to shareholders. Among the information that has been made available, however, is that as of June 2000, J.P. Morgan reported nearly $30 billion of gold derivatives and Chase Manhattan Corp., although merged with J.P. Morgan, still reported separately in 2000 that it had $35 billion in gold derivatives. Analysts agree that the derivatives have exploded at this bank and that both positions are enormous relative to the capital of the bank and the size of the gold market. "It gets worse. J.P. Morgan's total derivatives position reportedly now stands at nearly $29 trillion, or three times the U.S. annual gross domestic product. "Wall Street insiders speculate that if the gold market were to rise, Morgan Chase could be in serious financial difficulty because of its "short positions" in gold. In other words, if the price of gold were to increase substantially, Morgan Chase and other bullion banks that are highly leveraged in gold would have trouble covering their liabilities. One financial analyst, who asked not to be identified, explained the situation this way: 'Gold is borrowed by Morgan Chase from the Bank of England at 1 percent interest and then Morgan Chase sells the gold on the open market, then reinvests the proceeds into interest-bearing vehicles at maybe 6 percent. At some point, though, Morgan Chase must return the borrowed gold to the Bank of England, and if the price of gold were significantly to increase during any point in this process, it would make it prohibitive and potentially ruinous to repay the gold.'" One reason no one knows for sure what is happening in the gold market is because those that do know aren't saying. For example: how has the Fed and the US government used the gold market for their own purposes? The Gold Anti- Trust Action group has dug up some tantalizing, oblique references. There is, for example, this comment from a former Fed governor during a meeting of the Federal Open Market Committee on March 26, 1991: "I would hesitate for us to have foreign currency holdings that have swap puts that just sit there, [which] is now becoming the case for our gold." At another FOMC meeting, in January 1995, then Federal Reserve Governor Lawrence Lindsey asks about the legal authority to engage in a Mexican financial rescue package then under discussion. J. Virgil Mattingly, general counsel of the Fed and FOMC, replied: "I don't think there is a legal problem in terms of the authority. The statute is very broadly worded in terms of words like 'credit' - it has covered things like the gold swaps - and it confers broad authority." Here is Fed Chairman Alan Greenspan before the House Banking Committee and Senate Agricultural Committee in July 1998: "Nor can private counter-parties restrict supplies of gold, another commodity whose derivatives are often traded over-the-counter, where central banks stand ready to lease gold in increasing quantities should the price rise." In January 2000, Greenspan wrote a letter to Senator Lieberman attempting to explain his testimony: "This observation simply describes the limited capacity of private parties to influence the gold market by restricting the supply of gold, given the observed willingness of some foreign central banks - not the Federal Reserve - to lease gold in response to price increases . . . The Federal Reserve owns no gold and therefore could not sell or lease gold to influence its price. Likewise, the Federal Reserve does not engage in financial transactions related to gold, such as trading in gold options or other derivatives. Most importantly, the Federal Reserve is in complete agreement with the proposition that any such transactions on our part, aimed at manipulating the price of gold or otherwise interfering in the free trade of gold, would be wholly inappropriate." But now consider a lawsuit in which Edward A. J. George, Governor of the Bank of England and a director of the Bank of International Settlements, is quoted as having written: "We looked into the abyss if the gold price rose further. A further rise would have taken down one or several trading houses, which might have taken down all the rest in their wake. Therefore at any price, at any cost, the central banks had to quell the gold price, manage it. It was very difficult to get the gold price under control but we have now succeeded. The U.S. Fed was very active in getting the gold price down. So was the U.K." AS GATA would point out later, "The 'abyss' was the problem of covering the short physical gold position evidenced by a mountain of gold derivatives on the books of the bullion banks." It was none other than former Treasury Secretary and now Harvard president Lawrence Summers, who in a 1988 paper explained why a number of gold specialists are highly skeptical of the banks' and government's role in gold prices. Summers, then Nathaniel Ropes professor of political economy at Harvard, co- authored with Robert B. Barsky an article entitled "Gibson's Paradox and the Gold Standard." A principal conclusion of the article is that in a genuinely free gold market unaffected by "government pegging operations," gold prices will move inversely to real long-term interest rates, rising when real rates fall, and falling when real rates rise. Last August, the Golden Sextant web site offered this analysis: "Gibson's paradox continued to operate for another decade after the period covered by Barsky and Summers. But sometime around 1995, real long-term interest rates and inverted gold prices began a period of sharp and increasing divergence that has continued to the present time. During this period, as real rates have declined from the 4% level to near 2%, gold prices have fallen from $400/oz. to around $270 rather than rising toward the $500 level as Gibson's paradox and the model of it constructed by Barsky and Summers indicates they should have. The historical evidence adduced by Barsky and Summers leaves but one explanation for this breakdown in the operation of Gibson's paradox: what they call 'government pegging operations' working on the price of gold. What is more, this same evidence also demonstrates that absent this governmental interference in the free market for gold, falling real rates would have led to rising gold prices which, in today's world of unlimited fiat money, would have been taken as a warning of future inflation and likely triggered an early reversal of the decline in real long-term rates." GATA, which would like to see gold prices function freely, claims that financial giants such as Goldman Sachs and Morgan have conspired with the Treasury to keep gold prices low. It sees this practice as risking a short covering panic, endangering the US gold supply, and helping countries such as Russia, China, and Japan who are happily buying the cheap gold. And it notes that the US Mint has included in its inventory some "deep storage gold," which GATA suspects may be gold that is still to be mined. Banks have loaned gold, have shorted gold, and may have manipulated gold prices with the help of the government. If so, a marked rise in gold prices could cause a short covering panic since the demand for gold would outstrip the actual supply. In one of the bizarre examples of what can happen, a gold price rice in the recent past caused two mining companies to belly up. Why? Well in part because they had been convinced by their financial advisors to short their own product. Even Marx had more respect for capitalism than that. The size of the derivatives - gold and otherwise - held by Morgan is staggering and therein lies what could be a fatal problem; as one analyst put it, "Morgan is too big to fail and it's too big to bail." MORE MORE MORE ||| DOCUMENTS OBTAINED BY PUBLIC Citizen suggest that as governor of Texas, President Bush helped promote Enron Corp.'s foreign and domestic business agenda on behalf of company CEO Kenneth Lay In 1999, for example, Lay sent Bush a letter asking him to meet with the Romanian prime minister when he visited Houston. Lay noted that Enron had just finalized a gas marketing joint venture with Petrom and had a Bucharest office. Lay noted that "we are committed to participation in the Romania energy and water markets." In 1997, Lay sent Bush a letter noting that Bush would be meeting with Uzbekistan's ambassador and saying that Enron was negotiating a $2 billion joint venture to develop Uzbekistan's natural gas. Lay noted that "this project can bring significant economic opportunities to Texas" and said that "I am delighted that the two of you are meeting." In 1997, Lay sent Bush a letter thanking him for calling then-Pennsylvania Gov. Tom Ridge, noting that "I am certain that will have a positive impact on the way he and others in Pennsylvania view our proposal to provide cheaper electricity to consumers." In 1997, Lay sent Bush a letter thanking him for his efforts to find a middle ground on the debate regarding electricity industry restructuring in Texas. "Thanks to your leadership . . . we made significant progress towards the goal of making the state's electricity industry fully competitive. . . . Enron looks forward to continuing to work with you." In 1998, Lay, as chair of the governor's business council, sent a letter to Bush thanking him for his "outstanding and committed leadership" in getting eight bills passed that made changes to the legal system to help business. In 1998, Lay wrote Bush to bring his attention to a federal tax bill relating to wind production tax credits that Lay was supporting for Enron's wind energy business and asked Bush to send a letter to U.S. House Ways and Means Committee Chairman Bill Archer in support of the measure. MORE PHOTOCOPIES ||| FLOYD NORRIS & DAVID BARBOZA NY TIMES - Kenneth L. Lay sold $100 million in Enron stock last year, the company disclosed, with a large part of that coming from selling shares back to the company after he was warned by Sherron S. Watkins that the company might collapse "in a wave of accounting scandals." The sales, disclosed in a report filed by Mr. Lay with the Securities and Exchange Commission, included $20 million of shares sold in the three weeks after Ms. Watkins, an Enron official, sent her warning to Mr. Lay. It is not clear how much profit Mr. Lay made on his sales, many of which came while he was encouraging Enron employees to buy shares . . . Despite the sales, family members said yesterday that Mr. Lay, who is 59, faced serious financial difficulties as he struggled to repay loans taken out to make investments, many of which have lost value. ||| SCOTT POLLS - 78% of American adults believe that senior Enron executives should spend some time in jail. Among American investors, 85% believe jail time is in order for Enron officials. Those numbers represent an increase from two weeks ago when 66% of adults thought jail time was appropriate . . . 40% of Americans now expect the Enron bankruptcy to seriously hurt the U.S. economy, while 33% say it will not . . . Despite the intense interest in the Enron story, it is not clear at this time whether either political party has an Enron advantage. MORE ||| SHAILA K. DEWAN - Even as Enron (news/quote) insiders have become Washington's favorite and perhaps most politically profitable target, Houston's lawmakers have been slow to join in. Instead of vitriol, they have expressed sorrow, focusing on the plight of former employees. Representative Sheila Jackson-Lee, a Democrat whose district includes Enron's headquarters, has appeared most prominently in news accounts as the author of bills intended to protect pensions and as a Washington shepherd for a group of ex-Enron workers bused in by the Rev. Jesse Jackson. "I've been in the mode of action," as opposed to inquisition, she said in an interview earlier this month . . . Such restraint is not the norm for Ms. Jackson-Lee, who is known to relish publicity and weigh in on issues large and small. "It's out of character for her not to stand up and be waving the flag for morality," said Tony Williams, a Democratic campaign consultant here. "You've got to wonder why she's being so quiet. Sheila's supposed to be the people's person." To some, the reason for the silence is clear: money. Ms. Jackson-Lee owes her political career to Mr. Lay, who supported her, despite her liberal views, to help beat her predecessor. In Congress, she and another Democratic Houston representative, Ken Bentsen, are among the biggest recipients of Enron campaign money. Along with Gene Green, a third Democratic representative from Houston, they have returned at least some of their campaign contributions from Enron. But others who had their campaign coffers enriched by Enron have used more direct means of distancing themselves from the company. Representative Billy Tauzin, Republican of Louisiana, has even suggested that "maybe somebody ought to go to the pokey for this." Ms. Jackson-Lee received the bulk of her Enron money for the 1994 election, when she won her seat. MORE ||| JOHN BRESNAHAN, ROLL CALL - In the spring of 2000, as the presidential battle between George W. Bush and then Vice President Al Gore heated up, Enron Corp. lobbyists in Washington quietly launched an effort to reach out to the Gore campaign and his allies on Capitol Hill . . . Enron's Washington office came up with a "Gore 2000 Strategy," a copy of which was obtained by Roll Call. This document outlines a "six-month action plan "designed to help Enron officials build ties with Gore at the same time the Houston-based firm and its employees were on their way to becoming the top donors to Bush's White House campaign, kicking in more than $113,000 in direct contributions . . . Enron donated just $13,750 to the Gore campaign, according to federal election records. MORE ||| ELLEN NAKASHIMA & PETER BEHR WASHINGTON POST - As an Enron Corp. division vice chairman, Thomas E. White was responsible for the nuts-and- bolts performance of big energy-management contracts with an impressive roster of customers, ranging from J.C. Penney Co. to the Archdiocese of Chicago. How well White did that job has now become an issue in the aftermath of Enron's collapse, as investigators try to determine whether White's unit, Enron Energy Services, contributed to the massive misstatement of Enron's profits over the past four years. White, who retired in 1990 from the Army as a brigadier general, returned to the Pentagon last year as President Bush's choice as secretary of the Army - an appointment for which his business expertise was highly touted. Now he and others who worked at EES are answering investigators' questions about the unit's operations. White has declined to discuss publicly his 11-year executive career at Enron. "I have fully cooperated with investigators on the subject of Enron and will continue to do so," he told a reporter. MORE NEAL TRAVIS, NY POST - Bill Clinton may have a lot more to answer for. Some of Ken Lay's powerful friends in Washington say the former Enron chief has good reason to take the Fifth before Congress and to stall investigators as long as possible. These friends suggest, quite seriously, that President Bush could pardon "Kenney boy" in the event he's convicted in the scandal. "We'd have the Marc Rich precedent on our side," notes one GOP moneybags. "Clinton certainly raised - or should it be lowered? - the pardon bar in that case." He's probably right. The hoo-hah about Clinton's late-night, last-minute pardoning of the fugitive financier quickly died down and the threatened congressional investigations seem to have petered out. Should Bush want to keep his Texas pal out of the pokey (if it comes to that), he could grant a presidential pardon at the end of 2004, right after his re-election - or his defeat. MORE THE LIST Amount given by Enron to political parties, 1991-2001 Republican Party: $2,943,548 Democratic Party: $992,740 Green Party: $0 || RONALD FINK, CFO MAGAZINE - In an appearance before the Securities and Exchange Commission late last month, former Enron CFO Andrew Fastow is said to have invoked the Fifth Amendment when asked about his role in the company's downfall. Just days before, Fastow's lawyer reportedly told one newspaper that Fastow bears no responsibility for the company's collapse - the largest in U.S. corporate history. But Fastow's own comments suggest that he does. In an interview with CFO in mid-1999, Fastow asserted that he had helped keep almost $1 billion in debt off Enron's balance sheet through the use of a complex and innovative arrangement. "It's not consolidated and it's non- recourse," he told CFO. That would seem to depend on how you define "non-recourse." In fact, the 10-Q that Enron filed on November 19, 2001, states plainly that the debt ultimately was Enron's responsibility. According to the filing, the $915 million debt was backed by Enron's obligation to extinguish it, if necessary with cash. That obligation, as reported in the 10-Q, would fall to Enron if the company experienced a downgrade below investment grade by any of the three major credit rating agencies. Sure enough, that downgrade took place shortly after the disclosure of the $915 million obligation, along with another $3 billion in similar off-balance- sheet liabilities. And that downgrading, in turn, prompted Enron's bankruptcy filing. The debt that Fastow discussed with CFO was needed for a partnership called Marlin, which helped finance the Atlantic Water Trust, Enron's unconsolidated subsidiary. The Atlantic Water Trust in turn invested in Azurix, a subsidiary that owned a majority of the water facilities of a U.K. company known as Wessex. "What we did," Fastow told CFO, "is we set up a trust, issued Enron Corp. shares into the trust, and then the trust went to the capital markets and raised debt against the shares in the trust, using the shares in the trust as collateral." During the 1999 interview, Fastow boasted that the Atlantic Water Trust was so effective at minimizing Enron's balance-sheet exposure that several banks that had not been involved in the transaction later "came back and marketed it to us" as their own invention. MORE ||| BOB PORT, NY DAILY NEWS - Yet another White House official has a long history with Enron. White House counsel Alberto Gonzales, who has been mentioned as a possible Bush nominee for the Supreme Court, received more than $100,000 in political contributions from the energy industry in recent years as a justice on the Texas Supreme Court. Enron and Enron's law firm were Gonzales' biggest contributors in his 2000 judicial election, giving $35,450. Gonzales also worked for Enron's law firm from 1982 through 1992. In addition, Gonzales served as special counsel to the host committee for a 1990 world economic summit held in Houston. Former Enron CEO Kenneth Lay was chairman of that committee. Now Gonzales is the White House advocate for keeping secret the roster of people who helped Vice President Cheney devise the administration's energy policy. ||| RUSS BAKER, NATION - On December 14, Bush invoked executive privilege in refusing to comply with two subpoenas from [Rep. Dan] Burton's panel, the House Committee on Government Reform, seeking information from the Justice Department. One, a continuation of Burton's late-1990s anti-Clinton crusade, requested internal prosecutorial memos outlining Janet Reno's decision not to appoint an independent counsel to investigate impropriety in Clinton/Gore fundraising. The second concerned an FBI investigation in Boston more than twenty-five years ago. When Burton's committee requested internal prosecutorial memos from the case, the Administration balked, saying that such a release would have a chilling effect on confidential advice offered within the executive branch. . . Why is Bush trying to stake a claim of executive privilege in two closed investigations in which there is no longer any threat to law enforcement or prosecution? Indeed, the political fallout from any revelations about Janet Reno's decision not to pursue an independent investigation of Clinton/Gore campaign finances could only hurt Democrats. [Law professor and executive privilege expert Charles Tiefer] and others worry that this may be part of a far-reaching strategy. "President Bush will want to stake out his secrecy powers in cases like these where he can't be accused of covering up a matter of political or corrupt self-interest," says Tiefer. "Next year, if the investigating accountants put together a criminal case against Enron, but for inexplicable reasons the Justice Department refuses to charge anyone except low-level or insignificant Enron officials, the same type of President-ordered cover-up would be used to prevent Congress and the public from finding out why no serious indictments occurred." MORE ||| MOLLY IVINS - On Jan. 25, the administration ordered federal agencies to review their contracts with Arthur Andersen and Enron, saying the scandal swirling around the companies raise doubts about whether they should continue to receive taxpayer money. This would be well and good if the same administration had not, on Dec. 27, repealed a Clinton-era rule that prevents the government from awarding federal contracts to businesses that have broken environmental, labor, tax, civil rights or other laws. What we have here is not so much hypocrisy as complete incoherence. Shouldn't they have to wait at least a month before they contradict themselves? Or maybe the Bush doctrine is that you can give government contacts to chronic lawbreakers as long as they're not in the headlines. MORE ||| THE REASON I got involved is that Andersen is in big trouble and they were looking for someone to sprinkle some holy water on them. -Paul A. Volcker Jr., former Federal Reserve chairman and new chief of an Arthur Andersen oversight committee. ||| NO PERSON involved in pursuing this investigation has any conflict or any ties that would require a recusal. - Justice Department explaining why an independent prosecutor is not needed to investigate Enron, a major backer of the Bush administration. ||| LA TIMES - Nearly half said that the Bush administration's actions in regard to Enron have been at least unethical (35%) if not outright illegal (12%) while only a quarter think the administration did nothing wrong. . . The survey found strong public support for independent oversight of investigations into the Enron collapse. After being told that Attorney General John Ashcroft recused himself because of having accepted campaign contribution from Enron, six out of ten said that the Justice department cannot be trusted to be impartial in this issue, and that a special prosecutor should be appointed to oversee the case." MORE WHEN FORTUNE SMILED "Fortune is painted blind, with a muffler afore her eyes" - William Shakespeare The following is from an Enron brag sheet distributed in Latin America a while back. - 100 Best Companies to Work for in America (Fortune Magazine, January 11, 1999) - Forbes A-List of Companies - Top Power Company in the World (Forbes Global Business Magazine, January 11, 1999) - The Fortune Global 500 - The World's Largest Corporations (Fortune Magazine, August 3, 1998) - World's Most Respected Companies (Financial Times, November 30, 1998) It is then mentioned that Fortune had rated Enron the "most innovative company" in 1996, 1997, 1998, and 1999. || GREG PALAST - There's a whole band of power pirates out there fiddling the books, rigging the markets, and buying and selling politicians like bags of sugar - from Argentina to Houston to Washington to New York. In fact, you simply can't divide the collapse of Enron from the collapse of Argentina. Enron wasn't a bad apple - the entire system of deregulating electricity is rotten, root and branch. Arthur Andersen didn't have a few bad boys. As an investigator, I've watched their financial finagling run amok - all under the name of 'innovation.' They just don't get it: one, two, a hundred Enrons are charging down on us, and a dozen Argentinas - unless we restore the right to put the reins on these let-the-markets- rule pirates. That's why kids were in the streets of Seattle, and are now protesting the World Economic Forum. It's more than a protest, it's a wake-up call" MORE ||| JAMES RIDGEWAY, VILLAGE VOICE - Why would a man who wanted to hire a bodyguard one day kill himself the next? This is the question that rattles conspiracy theorists in the case of Cliff Baxter, the Enron whistleblower whose death by gunshot last week in Sugar Land, Texas, was ruled a suicide. Baxter had been subpoenaed to testify this week on Capitol Hill. Those who doubt the official line think he's another Vince Foster, murdered in cold blood to stop him from spilling the beans on Enron chief Ken Lay and blowing open the whole scam-offshore accounts, political connections, and all. Skeptics [in the Baxter death] are homing in on the Harris County coroner, Joye M. Carter, a former D.C. medical examiner who graduated from Howard and currently is attached to Baylor and the University of Texas. After performing a court-requested autopsy, Carter's office declared the former Enron exec had killed himself. While saying they respected that decision, local police said they intended to continue investigating. Carter has had her share of controversy. In 1998, Harris County paid a former employee in the medical examiner's office $375,000, after a jury agreed Carter fired her for reporting potentially illegal cover-ups. Then a federal court awarded another whistleblower $250,000 after she was fired for reporting that an unlicensed physician had performed autopsies. In 2000, writes The Houston Chronicle, a Harris County commissioner asked the county to hire an outside law firm to review Carter's hiring and firing practices. MORE THE LIST Some Enron losses Georgia: $127 million worth of Enron Ohio: $114 million. Washington state: $42 million Alabama: $47 million. University of California pension fund: $144 million loss. Teamsters: over $100 million. California's Public Employee Retirement Fund: $100 mil. Florida, $300 million. New York City: $110 million ||| DAVID LAWARUS, SAN FRANCISCO CHRONICLE - While the White House insists that details of its talks with Enron officials remain secret, a memo outlining those discussions reveals the extent to which the Houston energy giant lobbied to influence government policy. The memo, a copy of which was obtained by The Chronicle, was handed by former Enron Chairman Ken Lay to Vice President Dick Cheney last April when the two met to discuss the administration's response to California's energy crisis. The White House acknowledged that aspects of the memo resembled elements of Cheney's energy plan, but it refused to say whether the document was included in notes that Cheney now refuses to divulge to congressional investigators . . . The three-page document contains eight points spelling out Enron's case for why federal authorities should refrain from imposing price caps or other measures sought by California officials to stabilize runaway electricity prices. A number of the positions in the memo subsequently made it into Cheney's energy plan or were reflected in comments by senior administration officials. MORE ||| CATHRYN CONROY, COMPUSERVE NEWS - A day after former Enron executive John Clifford Baxter was found dead in his parked Mercedes with a gunshot wound to the head, the medical examiner ruled it a suicide. Not so fast. A top homicide investigator with the Sugar Land (Texas) Police Department isn't positive it was a suicide and is still actively gathering evidence in the case. And that is why the suicide note found next to Baxter's body has not yet been released. The New York Post reports that detective Billy Baugh is retracing Baxter's movements in the days prior to his death. In addition, he is checking the car for blood splatters and fingerprints and running ballistic tests on the gun that was found in Baxter's hand . . . Adding to the mystery: A family friend told the New York Post that Baxter's wife says he was home in bed just hours before his body was found at 2:23 a.m. on Friday, January 25. "His wife couldn't believe he could get out of bed without her knowing it," said the friend. The Sugar Land Police Department says it isn't disagreeing with the findings of the medical examiner, but wants to be sure nothing is overlooked in the investigation. Meanwhile, CBNC reported that the suicide note says Baxter was distraught about Enron's collapse and the prospect of having to testify against former colleagues and friends. MORE ||| PHILIP DELVES BROUGHTON, TELEGRAPH, LONDON - Enron was a company in love with itself. Office affairs were rampant, divorce among senior executives an epidemic, and stories of couples steaming up glass-walled offices after late-night meetings were the talk of Houston. "It was insane," says a former energy trader, soothing her financial injuries with a margarita. "There were no rules for people, even in our personal lives. Everything was about the company and everything was supposed to be on the edge - sex, money, all of it." . . . Jeff Skilling, the executive who transformed Enron under the more genteel rule of Ken Lay, the former chief executive, decorated his house all black and white, Enron's corporate colors, from the marble to the sofas to the flowers, wallpaper and pictures. The Enron wives became known around town for their Mercedes, fur-trimmed sweaters and leather trousers . . . [Skilling] wanted to recruit the best, which meant persuading the leading business school graduates, from places such as Harvard and Stanford, to choose Houston over New York or Silicon Valley. He did so by creating the same culture of unselfconscious greed and reward which Wall Street was forced to suppress by the insider-trading scandals of the late 1980s. He built his own Bonfire of The Vanities in Houston and everyone wanted to feel its warmth . . . Managers employed a system known as "rank or yank". Every employee's performance was ranked 1-5. Five meant you were out. The bottom 15 per cent of workers were fired each year. For the best workers the incentives were staggering. Bonus day was known at the company as Car Day, because of the lines of extraordinary sports cars arriving for the most successful employees. MORE ||| WASHINGTON POST - Former Enron executives disclosed that a top Bush campaign adviser, Edward Gillespie, served as the company's key conduit to the White House and House leaders. Gillespie's firm received $525,000 over nine months last year from Enron for lobbying that included the energy task force and economic stimulus legislation with tax provisions that would have helped Enron. MORE ENRON EXPLAINED I It was the fault of the press. The press caused it. - Mrs. Ken Lay ENRON EXPLAINED II [According to Biz Ethics, the following is circulating among former Enron employees] Traditional Capitalism: You have two cows. You sell one and buy a bull. Your herd multiplies, and the economy grows. You sell them and retire on the income. Enron Capitalism: You have two cows. You sell three of them to your publicly listed company, using letters of credit opened by your brother-in-law at the bank, then execute a debt/equity swap with an associated general offer so that you get all four cows back, with a tax exemption for five cows. The milk rights of the six cows are transferred through an intermediary to a Cayman Island company secretly owned by the majority shareholder who sells the rights to all seven cows back to your listed company. The Enron annual report says the company owns eight cows, with an option on one more. ||| JONI JAMES, MIAMI HERALD - Florida House Speaker Tom Feeney plans to appoint a select committee to investigate how the state pension fund lost $306 million on Enron stock. Feeney's plan - coupled with investigations already under way at the pension fund and the attorney general's office - will bring to three the number of state entities investigating the ill-timed stock purchases by a contract fund manager on behalf of the pension plan . . . The State Board of Administration, which oversees the $96 billion pension fund, has joined a class- action lawsuit against the directors of Enron and its accounting firm, Arthur Anderson. MORE ||| DRUDGE REPORT - Enron-stung GOPers are discreetly eyeing the collapse of Global Crossing [which became the 4th largest bankruptcy in history] and its Chairman Gary Winnick, a top Democrat donor who helped DNC head Terry McAuliffe turn a $100,000 stock investment - into $18,000,000. McAuliffe arranged for Winnick to play golf with President Clinton in 1999 after his cash windfall. Winnick then gave a million dollars to help build Clinton's presidential library . . . "McAuliffe is a guy who made millions and millions and millions off this Global Crossing stock? And the company goes bankrupt. And he has the gonads to criticize anyone on Enron," blasted [a] Bush insider who asked not to be identified . . . For McAuliffe, Global Crossing turned out to be a bonanza. The stock had soared in the late 90s, when Winnick once bragged that he was the "richest man in Los Angeles." McAuliffe operated out of an office in downtown Washington that belonged to Winnick - to help the mogul "work on deals." McAuliffe told the NY Times' Jeff Gerth in late '99 that his initial $100,000 investment grew to be worth about $18 million, and he made millions more trading Global's stock and options after it went public in '98. MORE ||| WORTH MAGAZINE - In 1995, Cincinnati billionaire Carl Lindner, whom McAuliffe had successfully courted as a donor, put up money for McAuliffe to buy American Heritage Homes, then the second-largest home builder in Florida. And in 1997, Los Angeles businessman Gary Winnick, also a Democratic donor, gave McAuliffe an early opportunity to invest $100,000 in Winnick's new company, Global Crossing, an owner and operator of undersea fiber-optic cables. When the stock subsequently soared, McAuliffe made a reported $18 million from that $100,000 investment. Two years later, McAuliffe arranged for Winnick to play golf with President Clinton, and Winnick then gave a million dollars to help build Clinton's presidential library. So it went in the 1990s: McAuliffe was helping the rich and powerful gain access to Bill Clinton, and everyone was making money. Anyone who suggested that there was something inappropriate about all the back-scratching-something that reeked of access peddling-only sounded like a spoilsport. With the stock market boom and the Internet gold rush and the whole country making money, why not join the party? MORE ||| DICK MORRIS, NY POST - Democrats seeking to blame President Bush and the GOP for the Enron scandal need to look more closely at their own house - especially at the work done by the former Democratic National chairman, Sen. Christopher J. Dodd. While many candidates of both parties have received campaign contributions from Enron and its "independent auditor" Arthur Andersen, very few have passionately fought their cause in Washington as diligently as Chris Dodd. It was on account of Dodd's tireless efforts that Arthur Andersen was able to act as both "independent auditor" and management consultant to Enron for $100 million a year. That role - so fraught with conflict of interest that it makes a joke of the concept of outside auditors protecting shareholders - has been identified as one of the major causes of the debacle. In 1995, it was Dodd who rammed through legislation, overriding President Clinton's veto, to protect firms like Andersen from lawsuits in cases just like Enron. The Dodd bill limited liability for lawyers and accountants for "aiding and abetting" corporate fraud by their clients, making them liable only for their "proportionate" share of the blame, rather than for the entire fraud. So, if an accounting firm kept secret the true picture of a corporation's finances, it would only be liable for part of the total fraud on the investors. For shareholders, this law is awful - the fraudulent company has usually lost nearly all its value before the shareholder learns about it, so there's nothing left. For the accounting firm, though, it's great - the shareholders can't pin the total losses on you. MORE ||| JOHN MCCASLIN, WASHINGTON TIMES - Enron-funded pundits. That's what columnist Andrew Sullivan, senior editor of the New Republic, has labeled those journalists who pocketed Enron cash before the company collapsed in bankruptcy. The list of scribes includes: Bill Kristol, Weekly Standard editor (paid $100,000 for serving on an Enron advisory board); Lawrence Kudlow, National Review contributing editor (got $50,000 from the Houston company); Paul Krugman, New York Times columnist (received $50,000 for serving on Enron's advisory board); Peggy Noonan, Wall Street Journal columnist (pocketed as much as $50,000 for helping prepare Enron's annual report and one speech for former Enron CEO Kenneth L. Lay). So, what's a journalist with his or her hand stuck in a crumbling Enron cookie jar to do? "Let's say these Enron-funded pundits did nothing illegal or unethical," writes Mr. Sullivan. "Let's say they just took $50,000 minimum from this company for legit extracurricular work. Maybe they didn't know what a scam Enron was at the time. The point is at some point in the future any big corporation could be a scandal. "And what does the pundit do then? He can disclose, sure, as Krugman and Noonan have," he observes. "But that doesn't get rid of the problem, unless they actually return the money." No, there's an even bigger problem. One that smacks against the integrity and ethics that should have been remembered from Journalism 101. "Haven't these pundits essentially undermined themselves as independent watchdogs of the culture?" Mr. Sullivan asks. "Isn't the entire point of the press to be independent - observers of problems, not part of them?" MORE MARCH 2002 ||| JACQUELINE TRESCOTT WASHINGTON POST - Smithsonian Secretary Lawrence M. Small told a congressional panel that the $2.5 billion needed to modernize the institution's museums and the National Zoo will have to be raised from both government and private sources. But Rep. Maurice Hinchey (D-N.Y.) told Small he had already seen enough of soliciting funds from corporations and individuals, and then rewarding them with their names on halls, buildings and theaters. "Frankly, just speaking as an individual citizen, I deeply resent it. You didn't start this but you seem to me to be the biggest cheerleader. What we are experiencing is crass commercialization," Hinchey said. "I think it is a bad thing - we are selling ourselves very, very cheaply. I would hope that it would stop. I would hope you will do something to stop it. I hope that this Congress would recognize its responsibility and fund all of what goes on so we wouldn't have to stoop so low. This is very troubling." . . . Three Republicans on the House Appropriations subcommittee said they found some benefit in the corporate partnerships. Rep. Ralph Regula (R-Ohio) said the films of the National Zoo done by the Animal Planet network "really raise awareness." Rep. George Nethercutt (R-Wash.) said, "If the regents take a hard look and don't put out flashing neon signs, I think it is a matter of taste." Rep. Zach Wamp (R-Tenn.) added that he could imagine Theodore Roosevelt would be encouraged to have Chiquita Banana company support an ape exhibition. MORE ||| RALPH NADER criticized Smithsonian Secretary Lawrence Small for ignoring the taxpayers who pay most of his salary and selling this nation's great legacy to a weapons manufacturer whose revenues are derived heavily from taxpayers. Nader also denounced the Smithsonian chief's decision to belittle the contribution of an individual and promote a big corporation instead. Nader was responding to news that the Smithsonian has agreed to rename the movie theater in the popular National Air & Space Museum after the Lockheed Martin Corp. The company is expected to announce soon a $10 million gift to the Smithsonian. Until now the Air & Space Museum theater has borne the name Samuel P. Langley, the aviation pioneer. The Smithsonian is governed by a 17-member Board of Regents, including Vice President Dick Cheney and Chief Justice William Rehnquist. "Cheney, Rehnquist and Small are disrespecting the taxpayers," Nader said. "Besides, individuals have made this nation great," Nader said. "The Smithsonian should honor individual achievement, not corporate glory-mongering." In recent years, Lockheed Martin has settled several lawsuits related to the use or release of toxic chemicals. "The Smithsonian's mission is to promote the increase and diffusion of knowledge, not to honor corporate polluters," Nader said. "Just how is Lockheed accounting for this contribution on its tax returns?" MORE RICHARD A. OPPEL Jr. & KURT EICHENWALD, NY TIMES - A House committee sent a letter to Mr. Skilling, the former Enron chief executive, saying that recent interviews with other Enron officials "appear to raise serious questions" about whether Mr. Skilling told the truth before Congress last month. The interviews, with three Enron accounting executives, concern one of the most contentious and significant episodes of suspected financial manipulation at Enron: How much Mr. Skilling knew and approved of the restructuring of four partnerships known as the Raptors a year ago that essentially allowed Enron to delay the disclosure of hundreds of millions of dollars in losses. When those losses became public in October, they began the cascade of negative disclosures that ultimately led to Enron's collapse in December. Today, the House Energy and Commerce Committee, which heard Mr. Skilling's testimony on Feb. 7, sent him a letter stating that the interviews - conducted by investigators for a special committee of the Enron board - suggest he was aware of much of the details of the restructuring, despite his statement that he did not know it was intended to conceal losses or that anything was wrong with Enron's financial statements. MORE ||| DON VAN NATTA JR. & NEELA BANERJEE - Eighteen of the energy industry's top 25 financial contributors to the Republican Party advised Vice President Dick Cheney's national energy task force last year, according to interviews and election records . . . Critics of the process said that President Bush and Mr. Cheney were quick to respond to executives from the energy sector not only because of campaign contributions but also because they share the philosophy of the oil patch, where both made fortunes. 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Services Facilities Modification & Repair Operations, Maintenance & Logistics Emergency Response Security Solutions Printer Friendly Version of this Page Contact Info Dennis Wright dennis.wright@ halliburton.com Related Info Health, Safety & Environment Energy Services Solutions Flexible Pipe Reinforced Thermo- plastic Pipe EvaluationReal Time Reservoir SolutionsDrillingWell CompletionEnhancementWell MaintenancePipelinesSubseaDeepwaterPipeline & Process ServicesSurface EquipmentOil & GasGovernment OperationsInfrastructureFertilizers & Synthesis GasLNG/GTL/Stranded GasPetrochemicals & PolymersPetroleum RefiningPulp & PaperPower About Halliburton Founded in 1919, Halliburton is one of the world's largest providers of products and services to the petroleum and energy industries. 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KBR's non-energy business meets the engineering and construction needs of governments and civil infrastructure customers. KBR also provides operations and maintenance for a wide variety of facilities. " Those who would give up essential liberties for a measure of security, deserve neither liberty nor security."- Benjamin Franklin EFF Analysis Of The Provisions Of The USA PATRIOT Act That Relate To Online Activities (Oct 31, 2001) Introduction On October 26, 2001, President Bush signed the USA Patriot Act (USAPA) into law. With this law we have given sweeping new powers to both domestic law enforcement and international intelligence agencies and have eliminated the checks and balances that previously gave courts the opportunity to ensure that these powers were not abused. Most of these checks and balances were put into place after previous misuse of surveillance powers by these agencies, including the revelation in 1974 that the FBI and foreign intelligence agencies had spied on over 10,000 U.S. citizens, including Martin Luther King. A Rush Job The bill is 342 pages long and makes changes, some large and some small, to over 15 different statutes. This document provides explanation and some analysis to the sections of the bill relating to online activities and surveillance. Other sections, including those devoted to money laundering, immigration and providing for the victims of terrorism, are not discussed here. Yet even just considering the surveillance and online provisions of the USAPA, it is a large and complex law that had over four different names and several versions in the five weeks between the introduction of its first predecessor and its final passage into law. While containing some sections that seem appropriate -- providing for victims of the September 11 attacks, increasing translation facilities and increasing forensic cybercrime capabilities -- it seems clear that the vast majority of the sections included have not been carefully studied by Congress, nor was sufficient time taken to debate it or to hear testimony from experts outside of law enforcement in the fields where it makes major changes. This concern is amplified because several of the key procedural processes applicable to any other proposed laws, including inter-agency review, the normal committee and hearing processes and thorough voting, were suspended for this bill. Were our Freedoms the Problem? The civil liberties of ordinary Americans have taken a tremendous blow with this law, especially the right to privacy in our online communications and activities. Yet there is no evidence that our previous civil liberties posed a barrier to the effective tracking or prosecution of terrorists. In fact, in asking for these broad new powers, the government made no showing that the previous powers of law enforcement and intelligence agencies to spy on US citizens were insufficient to allow them to investigate and prosecute acts of terrorism. The process leading to the passage of the bill did little to ease these concerns. To the contrary, they are amplified by the inclusion of so many provisions that, instead of aimed at terrorism, are aimed at nonviolent, domestic computer crime. In addition, although many of the provisions facially appear aimed at terrorism, the Government made no showing that the reasons they failed to detect the planning of the recent attacks or any other terrorist attacks were the civil liberties compromised with the passage of USAPA. Executive Summary Chief Concerns The EFF's chief concerns with the USAPA include: 1. Expanded Surveillance With Reduced Checks and Balances. USAPA expands all four traditional tools of surveillance -- wiretaps, search warrants, pen/trap orders and subpoenas. Their counterparts under the Foreign Intelligence Surveillance Act (FISA) that allow spying in the U.S. by foreign intelligence agencies have similarly been expanded. This means: a. Be careful what you put in that Google search. The government may now spy on web surfing of innocent Americans, including terms entered into search engines, by merely telling a judge anywhere in the U.S. that the spying could lead to information that is "relevant" to an ongoing criminal investigation. The person spied on does not have to be the target of the investigation. This application must be granted and the government is not obligated to report to the court or tell the person spied up what it has done. b. Nationwide roving wiretaps. FBI and CIA can now go from phone to phone, computer to computer without demonstrating that each is even being used by a suspect or target of an order. The government may now serve a single wiretap, FISA wiretap or pen/trap order on any person or entity nationwide, regardless of whether that person or entity is named in the order. The government need not make any showing to a court that the particular information or communication to be acquired is relevant to a criminal investigation. In the pen/trap or FISA situations, they do not even have to report where they served the order or what information they received. The EFF believes that the opportunities for abuse of these broad new powers are immense. For pen/trap orders, ISPs or others who are not named in the do have authority under the law to request certification from the Attorney General's office that the order applies to them, but they do not have the authority to request such confirmation from a court. c. ISPs hand over more user information. The law makes two changes to increase how much information the government may obtain about users from their ISPs or others who handle or store their online communications. First it allows ISPs to voluntarily hand over all "non-content" information to law enforcement with no need for any court order or subpoena. sec. 212. Second, it expands the records that the government may seek with a simple subpoena (no court review required) to include records of session times and durations, temporarily assigned network (I.P.) addresses; means and source of payments, including credit card or bank account numbers. secs. 210, 211. d. New definitions of terrorism expand scope of surveillance. One new definition of terrorism and three expansions of previous terms also expand the scope of surveillance. They are 1) § 802 definition of "domestic terrorism" (amending 18 USC §2331), which raises concerns about legitimate protest activity resulting in conviction on terrorism charges, especially if violence erupts; adds to 3 existing definition of terrorism (int'l terrorism per 18 USC §2331, terrorism transcending national borders per 18 USC §2332b, and federal terrorism per amended 18 USC §2332b(g)(5)(B)). These new definitions also expose more people to surveillance (and potential "harboring" and "material support" liability, §§ 803, 805). 2. Overbreadth with a lack of focus on terrorism. Several provisions of the USAPA have no apparent connection to preventing terrorism. These include: a. Government spying on suspected computer trespassers with no need for court order. Sec. 217. b. Adding samples to DNA database for those convicted of "any crime of violence." Sec. 503. The provision adds collection of DNA for terrorists, but then inexplicably also adds collection for the broad, non-terrorist category of "any crime of violence." c. Wiretaps now allowed for suspected violations of the Computer Fraud and Abuse Act. This includes anyone suspected of "exceeding the authority" of a computer used in interstate commerce, causing over $5000 worth of combined damage. d. Dramatic increases to the scope and penalties of the Computer Fraud and Abuse Act. This includes: 1) raising the maximum penalty for violations to 10 years (from 5) for a first offense and 20 years (from 10) for a second offense; 2) ensuring that violators only need to intend to cause damage generally, not intend to cause damage or other specified harm over the $5,000 statutory damage threshold; 3) allows aggregation of damages to different computers over a year to reach the $5,000 threshold; 4) enhance punishment for violations involving any (not just $5,000) damage to a government computer involved in criminal justice or the military; 5) include damage to foreign computers involved in US interstate commerce; 6) include state law offenses as priors for sentencing; 7) expand definition of loss to expressly include time spent investigating, responding, for damage assessment and for restoration. 3. Allows Americans to be More Easily Spied Upon by US Foreign Intelligence Agencies. Just as the domestic law enforcement surveillance powers have expanded, the corollary powers under the Foreign Intelligence Surveillance Act have also been greatly expanded, including: a. General Expansion of FISA Authority. FISA authority to spy on Americans or foreign persons in the US (and those who communicate with them) increased from situations where the suspicion that the person is the agent of a foreign government is "the" purpose of the surveillance to anytime that this is "a significant purpose" of the surveillance. b. Increased information sharing between domestic law enforcement and intelligence. This is a partial repeal of the wall put up in the 1970s after the discovery that the FBI and CIA had been conducting investigations on over half a million Americans during the McCarthy era and afterwards, including the pervasive surveillance of Martin Luther King in the 1960s. It allows wiretap results and grand jury information and other information collected in a criminal case to be disclosed to the intelligence agencies when the information constitutes foreign intelligence or foreign intelligence information, the latter being a broad new category created by this law. c. FISA detour around federal domestic surveillance limitations; domestic detour around FISA limitations. Domestic surveillance limits can be skirted by the Attorney General, for instance, by obtaining a FISA wiretap against a US person where "probable cause" does not exist, but when the person is suspected to be an agent of a foreign government. The information can then be shared with the FBI. The reverse is also true. Future Actions The EFF urges the following: 1. That law enforcement and the intelligence agencies will use these new powers carefully and limit their use to bona fide investigations into acts of terrorism. 2. That if these laws are misused to spy on innocent people, that the courts will appropriately punish those who misuse them and that Congress will reexamine its decision to grant such broad, unchecked powers. 3. That if these laws are misused to harm the rights of ordinary Americans involved in low level crimes unrelated to terrorism, the courts will refuse to allow evidence collected through use of these broad powers to be used in prosecuting them. 4. That the many vague, undefined terms in the USAPA will be defined in favor of protecting civil liberties and privacy of Americans. These include: the definition of "content" of e-mails which cannot be retrieved without a warrant. the definition of "without authority" in the computer trespass statute to include only those who have intentionally broken into computers that they have no relationship with, including educational institutions and other organizations that may not have formal "contractual" relationships with users. 5. That ISPs and others served with "roving" wiretaps and other Orders that do not specify them will require that the Attorney General give them certification that the order properly applies to them. 6. That Congress will require the law enforcement and intelligence agencies who operate under provisions of the USAPA that are set to expire in December, 2005, to provide them with comprehensive reports about their use of these new powers to enable Congress to reasonably determine whether these provisions should be renewed. (see related EFF statement) I. Expanded Surveillance with Reduced Checks and Balances A. A Brief, Incomplete Introduction to Electronic Surveillance under US Law. US law has provided four basic mechanisms for surveillance on people living in the United States: interception orders authorizing the interception of communications; search warrants authorizing the search of physical premises and seizure of tangible things like books or other evidence; "pen register" and "trap-and-trace device" orders (pen/trap orders), which authorize the collection of telephone numbers dialed to and from a particular communications device; and subpoenas compelling the production of tangible things, including records. Each mechanism has its own proof standards and procedures based on the Constitution, statutes, or both. US law also provides two separate "tracks" with differing proof standards and procedures for each of these mechanisms depending upon whether surveillance is done by domestic law enforcement or foreign intelligence. All of these have been expanded by the USAPA. For instance, when surveillance is conducted for domestic law enforcement purposes, the probable cause standard of the Fourth Amendment applies to interception orders and search warrants. But a court order compelling an ISP to produce e-mail logs and addresses of past e-mail correspondents uses a lower standard: the government must show specific and articulable facts showing reasonable grounds to believe that the records are relevant and material to an ongoing criminal investigation. A pen/trap order uses an even lower standard: the government need only tell the court that the surveillance is relevant to a criminal investigation. The standard for subpoenas is also very low. Where foreign intelligence surveillance is concerned, however, the standard of proof and procedures for each mechanism has been different. One key difference is that foreign intelligence surveillance is not based on the concept of criminality. Under the Foreign Intelligence Surveillance Act (FISA), the key issue is whether the intended surveillance target is an "agent of a foreign power" or a "foreign power." Only if the target is a U.S. citizen or permanent resident alien must the government show probable cause of criminality. Second, FISA allows a secret court to authorize US intelligence agencies to conduct surveillance using each of the four basic mechanisms listed above. For instance, FISA interception orders involving U.S. persons are issued by the secret court based on an application from the Attorney General stating reasons to believe that the surveillance target is an agent of a foreign power or a foreign power, certifying that "the purpose" of the surveillance is to gather foreign intelligence information, and several other facts and representations. The secret court's role here, however, is quite limited: it is not supposed to "second-guess" the government's certifications or representations. (Unsurprisingly, the secret FISA court has only denied one application in its over twenty-year existence.) Moreover, unlike ordinary interception orders, FISA does not require reports to the court about what the surveillance found; no reports of what is being sought or what information is retrieved are ever available to the public. Thus, the secret court's only practical accountability is in a district court when a surveillance target is prosecuted and seeks to suppress the fruits of FISA surveillance. FISA's requirements are even weaker if the electronic surveillance is directed solely at means of communications used exclusively between or among foreign powers and when it is unlikely that communications to which a U.S. person is a party will be intercepted; in such cases, surveillance may proceed for up to a year without a court order. Immediately after the September 11 attacks, electronic surveillance was conducted pursuant to FISA orders. There have been no reports that the limitations of FISA power posed any problems for the government. Domestic Law Enforcement Foreign Intelligence Surveillance 1. Intercept Orders. Title III (named after the section of the original 1. FISA Intercept Orders. legislation, the Omnibus Crime Control and Safe Streets Secret Court. No public information about what Act of 1968) surveillance is a traditional wiretap that surveillance requested or what surveillance allows the police to bug rooms, listen to telephone actually occurs, except for a raw annual report of conversations, or get content of electronic number of requests made and number granted communications in real time. (the secret court has only refused one request) Obtained after law enforcement makes a Previous standard was certification by Attorney showing to a court that there is "probable cause" General that "the purpose" of an order is a to believe that the target of the surveillance suspicion that the target is a foreign power or an committed one of a special list of severe crimes. agent of a foreign power. Law enforcement must report back to the court Attorney General is not required to report to the what it discovers. court what it does. Up to 30 days; must go back to court for 30-day Up to 90 days, or 1 year (if foreign power) extensions (Courts do not treat unopened e-mail at ISPs as real-time communications.) 2. Pen/Trap. Pen/Trap surveillance was based upon the physical wiring of the telephone system. It allowed law enforcement to obtain the telephone numbers of all calls made to or from 2. FISA Pen/Trap. a specific phone. Previous FISA pen/trap law required not only showing of Allowed upon a "certification" to the court that relevance but also showing that the communications the information is relevant to an ongoing device had been used to contact an "agent of a foreign criminal investigation. power." Court must grant if proper application made While this exceeds the showing under the ordinary Does not require that the target be a suspect in pen/trap statute, such a showing had function of that investigation and law enforcement is not protecting US persons against FISA pen/trap surveillance. required to report back to the court. Prior to USAPA there had been debate about how this authority is to be applied in the Internet context. 3. FISA Physical search warrants See FISA 50 USC § 1822. USAPA extends duration of 3. Physical search warrants physical searches. Judicial finding of probable cause of criminality; return Under previous FISA, Attorney General (without court on warrant. Previously, agents were required at the time order) could authorize physical searches for up to one year of the search or soon thereafter to notify person whose of premises used exclusively by a foreign power if premises were searched that search occurred, usually by unlikely that US person will be searched; minimization leaving copy of warrant. USAPA makes it easier to obtain required. A.G. could authorize such searches up to 45 surreptitious or "sneak-and-peek" warrants under which days after judicial finding of probable cause that US target notice can be delayed. is or is an agent of a foreign power; minimization required, and investigation may not be based solely on First Amendment-protected activities. 4. Subpoenas for stored information. 4. FISA subpoenas Many statutes authorize subpoenas; grand juries may Previously, FISA authorized collection of business issue subpoenas as well. EFF's main concern here has records in very limited situations, mainly records relating been for stored electronic information, both e-mail to common carriers, vehicles or travel, and only via court communications and subscriber or transactional records order. held by ISPs. Subpoenas in this area are governed by the USAPA permits all "tangible things," including business Electronic Communications Privacy Act (ECPA). records, to be obtained via a subpoena (no court order). Domestic Law Enforcement Foreign Intelligence Surveillance II. Increased Surveillance Authority The USAPA removes many of the checks and balances that prevented both police and the foreign intelligence agencies from improperly conducting surveillance on US citizens who are not involved in criminal or terrorist activity. For Internet users, it opens the door for widespread surveillance of web surfing, e-mails and peer to peer systems. In addition, the protections against the misuse of these authorities -- by the foreign intelligence agencies to spy on US citizens and by law enforcement to use foreign intelligence authority to exceed their domestic surveillance authority -- have been greatly reduced. A. Law enforcement intercept orders (Wiretaps) Wiretaps (for telephone conversations) can only be issued for certain crimes listed in 18 USC §2516. USAPA adds to this list. This restriction has never applied to interception of electronic communications. 1. Adds Terrorism. USAPA sec. 201 adds terrorism offenses (Note: this is probably redundant since list already included most if not all terrorist acts --e.g., murder, hijacking, kidnapping, etc.) 2. Adds Computer Fraud and Abuse Act (CFAA), 18 USC §1030. USAPA sec. 202 adds felony violations of the CFAA (see below for discussion of changes to CFAA). 3. Removes voicemail from Title III purview. USAPA sec. 209 allows police to get voicemail and other stored wire communications without an intercept order; now, only search warrant needed. 4. Exempts certain interceptions from requirement of judicial authorization Computer trespassers, see below. B. Law enforcement search warrants. 1. Single-jurisdiction search warrants for terrorism and for electronic evidence. In general, search warrants must be obtained within a judicial district for searches in that district. Fed.R.Crim.Pro. 41. USAPA relaxes this rule. USAPA sec. 219 Adds terrorist investigations to the list of items where single- jurisdiction search warrants may be issued. Allows issuance in any district in which activities related to terrorism may have occurred for search of property or person within or outside the district. USAPA sec. 220. Once a judge somewhere approves a warrant for seizing unopened e-mail less than 180 days old, that order can be served on any ISP/OSP or telecommunications company nationwide, without any need that the particular service provider be identified in the warrant. 2. "Sneak-and-peek" warrants greatly expanded. USAPA sec. 213. Can delay notification for "a reasonable period" and can be "extended for good cause shown" to court for any wire or electronic communication or tangible property. Problematic because notice to a searched person is a key component of Fourth Amendment reasonableness. C. Law enforcement Pen/Trap orders Pen/trap orders are issued by a court under a very low standard; USAPA does not change this standard. USAPA instead expands the reach of pen/trap orders. 1. Expressly includes Internet information, e.g., e-mail and Web browsing information. USAPA sec. 216 modifies 18 USC § 3121(c) to expressly include routing, addressing information, thus expressly including e-mail and electronic communications. "Contents" of communications excluded, but USAPA does not define what it includes (dialing, routing, addressing, signalling information) or what it excludes (contents). Serious questions about treatment of Web "addresses" and other URLs that identify particular content. DOES NOT SUNSET. Applies to those not named (nationwide). Previously, pen/trap orders limited by court's jurisdiction, so had to be installed in judicial district. Now, court shall enter ex parte order authorizing use anywhere within the US if court has jurisdiction over crime being investigated and attorney for US Government has certified that information "likely to be obtained" is "relevant to an ongoing criminal investigation." Order applies to any provider "whose assistance may facilitate the execution of the order, " whether or not within the jurisdiction of the issuing court. But if entity is not named, may require that US attorney provide written or electronic certification that the order applies to the person or entity being served. DOES NOT SUNSET. IF government agency uses its own technology (e.g., Carnivore), then and "audit trail" is required, e.g., 30 day report back to court. No mandate that equipment facilitate surveillance. sec. 222 (prevents CALEA application here). D. Law enforcement subpoenas (and some court orders) for stored information 1. USAPA sec. 210 amends Electronic Communications Privacy Act (ECPA). Expands records that can be sought without a court order to include: records of session times and durations, temporarily assigned network addresses; means and source of payments, including any credit card or bank account number. Allows disclosure of customer records by the service provider on the same basis that it currently allows content. Expands "emergency" voluntary disclosure to government of both content and customer records if reason to believe immediate danger of death or serious physical injury. Also expands ECPA 2703(d) court-ordered mandatory disclosure to government. USAPA Sec. 212. 2. USAPA sec. 211. Reduction of Privacy for Cable Records. Previously, the Cable Act had mandated strong privacy protection for customer records of cable providers; USAPA overrides these protections for customer records related to telecommunications services. This is a major change because several courts have already held that these privacy protections don't apply for telecommunications services. E. Information sharing between law enforcement and intelligence community Because foreign intelligence surveillance does not require probable cause of criminality and because of the fear that foreign intelligence surveillance aimed at foreign agents would violate the rights of US persons, the law has tried to keep foreign intelligence surveillance (including evidence gained therefrom) separate from law enforcement investigations. USAPA greatly blurs the line of separation between the two. 1. Easier to Use FISA authority for Criminal Investigations. USAPA Sec. 218 Foreign intelligence gathering now only needs to be "a significant purpose" not "the purpose" (edits to 50 USC § 1804(a)(7)(b), and 1823 (a)(7)(B)). FISA court only looks to see that certifications present and are not "clearly erroneous". Courts have said that it is not the function of the courts to "second guess" the certifications. 2. Now Can Disclose Formerly Secret Grand Jury Information to Intelligence Services. USAPA §203(a). Amends Federal Rule of Civil Procedure 6. Grand jury information now can be disclosed to intelligence services when "matters involve foreign intelligence or counterintelligence per 50 USC §401a or foreign intelligence information (defined below)" 3. Foreign Intelligence Information. New category of information that can be disclosed to foreign intelligence agents. Any info, whether or not concerning a US person, that "relates" to the ability of the US to protect against an actual or potential attack, sabotage or international terrorism or clandestine intelligence activities; any info, whether or not concerning a US Person, that "relates" to the national defense or security or the conduct of foreign affairs. DOES NOT SUNSET. 4. Disclose Criminal Wiretap Information With Any Government Official, Including Foreign Intelligence Services Section 203(b) amends 18 USC §2517. Allows disclosure of contents of wiretaps or evidence derived therefrom to any other government t official, including intelligence, national defense and national security, "to the extent such contents include foreign intelligence or counterintelligence or foreign intelligence information (see definition above) 5. General Authority to Disclose Section 203(d). Notwithstanding other law, lawful for foreign intelligence or counterintelligence or foreign intelligence information (see definition above) to be disclosed to anyone to assist in performance of official duties. USAPA Sec. 504 also authorizes general coordination between law enforcement and FISA surveillance. F. FISA 1. Intercept orders: adds "roving wiretap" authority to FISA. USAPA §206 amends 50 USC §1805. FISA court now may authorize intercepts on any phones or computers that the target may use. The foreign intelligence authorities can require anyone to help them wiretap. Previously they could only serve such orders on common carriers, landlords, or other specified persons. Now they can serve them on anyone and the Order does not have to specify the name of the person required to assist. No requirement that request for authority identify those. Roving wiretap authority raises serious Fourth Amendment problems because it relaxes the "particularity" requirements of the Warrant Clause. Such authority already exists under Title III. Increases duration of FISA intercept orders. USAPA §207 amends 50 USC §1805(e)(1) concerning surveillance on agents of a foreign power (not US persons) from 90 to 120 days. 2. FISA search warrants Extend time for surveillance. USAPA §207 amends 50 USC §1824(d) for judicially authorized physical searches to a) 90 days (up from 45), or b) if agent of a foreign power (employee or member of a foreign power but not US persons), 120 days. 3. FISA pen/trap orders USAPA Sec. 214. Amends 50 USC 1842 and 1843 (emergency) to allow pen/trap orders when they are concerning foreign intelligence information and: a. are not concerning a US person or; b. ARE concerning a US person, and to protect against international terrorism or clandestine intelligence activities, provided that such investigation is not conducted solely upon the basis of 1st Amendment activities. 4. FISA subpoenas and similar authorities Broad authority for compelling business records. Under current law, only records of common carriers, public accommodation facilities, physical storage facilities and vehicle rental facilities can be obtained with a court order. USAPA 215: Amends 50 USC §1862 to allow application to FISA court for an order to compel the production of any business record from anyone for any investigation to protect against international terrorism or clandestine intelligence activities (but cannot investigate a US person solely for First Amendment activities). a. No showing needed that the person is the agent of a foreign power. b. Order to a court--MUST be granted if application meets requirements c. Order won't say that it is under this section d. Persons served by it are gagged e. Semiannual list of applications and list granted, denied but no reporting of actual documents seized or their usefulness required to court or to Congress. G. Other changes related to surveillance 1. New surveillance of communications "relevant" to computer trespasser investigation USAPA sec. 217; Changes to 18 USC § 2510. In addition to the three traditional forms of surveillance, the USAPA adds another area where any government employee, not just law enforcement, may conduct content surveillance of US persons. This is when computer owner and operator "authorizes" surveillance and law enforcement agent "has reasonable grounds to believe contents of communication will be relevant" to investigating computer trespass and does not acquire anyone else's communications. Allows interception of messages suspected of being sent through a computer without "authorization." a. The term "authorization" is not defined, giving the owner/operator of protected computer and the government agent great discretion. b. BUT this does not include someone who is known to have an existing contractual relationship to access all or part of the computer. According to DOJ, ISP customers who send spam in violation of ISP's terms of service would not be trespassers. 2.Civil liability for certain unauthorized disclosures. USAPA sec. 223. This provision provides a small bit of relief for those who discover that law enforcement or the foreign intelligence authorities have disclosed information about them improperly. a. Allows Administrative discipline. Amends 18 USC §§ 2520, 2707 b. Allows §2712 Civil actions with a $10,000 recovery limit, but only for willful disclosures. [It's a $10K statutory damages minimum ("actual damages, but not less than $10,000, whichever amount is greater")] 3. Disclosure of Educational Records. amends 20 USC §1232g. USAPA sec. 507-8. a. Upon written application to a court (pen/trap standard), the Attorney General may require an educational agency to collect educational records "relevant" to an authorized investigation of a listed terrorist offense or "domestic or international terrorist offense." If application correct, court shall grant. (pen/trap standard) b. Same for National Education Statistics Act surveys 4. Similarly expands quasi-subpoena power for many other records. USAPA §505 authorizes issuance of national security letters for certain phone billing records, bank records, credit records on same showing as for FISA pen/trap (but no court order). III. Changes With Little Relationship to Fighting Terrorism. The EFF is also deeply dismayed to see that the Attorney General seized upon the legitimate Congressional concern following the September 11, 2001 attacks to pad the USAPA with provisions that have at most, a tangential relationship to preventing terrorism. Instead, they appear targeted at low and mid-level computer defacement and damage cases which, although clearly criminal, are by no means terrorist offenses and have no business being included in this bill. A. Computer Fraud and Abuse Act (CFAA 18 USC § 1030). The CFAA provides for civil and criminal liability for acts exceeding the "authority" to access or use a computer connected to the Internet. It is used to prosecute those engaging in computer graffiti, website defacement and more serious computer intrusion and damage. It has also been applied in civil cases to spammers and those sending unwanted bots to gather information from the websites of others. The USAPA makes several changes to this law, none of which seems aimed at preventing or prosecuting terrorist offenses -- which are separately defined and already include the use of computers to commit terrorism . An earlier version of the bill would have made many violations of the statute "terrorist" offenses. After outcry from EFF members and many others, most, but not all see below, of the offenses under §1030 were removed from the "terrorist" definition. However, instead the penalties and scope of §1030 were greatly expanded. The changes include: 1. Adds an "attempt to commit an offense" under §1030 to the list of illegal activities with the same penalties as an offense. Sec. 814. 2. The law now applies if the damage is done to computers outside the US that affect US Interstate commerce. Sec. 814 3. Includes state court convictions under similar statutes as priors for purposes of a second conviction with increased penalties. Sec. 814. 4. Increases penalties for violations of the statute. Sec. 814(1) "Loss" under the statute now expressly includes time spent responding and assessing damage, restoring data, program, system or information, any revenue lost, cost incurred or other consequential damages. Sec. 814. B. Computer Crimes under CFAA Defined as "Terrorist Offenses" As far as the investigation has revealed so far, computer crime played no role in the September 11, 2001 attack or in any previous terrorist attacks suffered by the United states. Computer crime, especially when it results in danger to lives, is a serious offense, the USAPA adds it to the list of "terrorist offenses." Although it is obviously possible that a computer crime in the future could be part of a terrorist offense, the definition of "terrorism" already includes murder, hijacking, kidnapping and similar crimes that would be the result of a "cyberterrorist" attack. Yet without explanation, early versions of the USAPA included even low level computer intrusion and web defacement as "terrorist offenses." The final bill was not so draconian, but still includes the following (among others unrelated to computer crime) as a "terrorist offense" under 18 USC §2332b(g)(5)(B): 1. An act calculated to influence or affect the conduct of government by intimidation or coercion or to retaliate against government conduct (this lsnguage was in existing law AND EITHER 2. violates 18 USC §1030(a)(1) accessing restricted or classified information on computers that require protection for reasons of national security, national defense or §11(y) of Atomic Energy Act of 1954 with reason to believe could that the information could injure US or advantage a foreign nation, and who willfully communicates the information to one not entitled to it, OR 3. violates 18 USC §1030(a)(5)(A)(i) resulting in damage that: a. causes medical care problem, physical injury, public health or safety, OR b. affects computer system used by or for a government entity in furtherance of the administration of justice, national defense, or national security. 4. If an offense is a federal terrorism offense per 18 USC 2332b(g)(5)(B): a. RICO procedures apply. Sec. 813. This includes seizure of assets pre-conviction, forfeiture post- conviction and many other procedural provisions previously applicable just to organized crime and the drug war. b. 8 year statute of limitation §3286 (sec. 809) c. Alternate maximum penalties (sec. 810) 15 year max penalty 810(c)(1) and if death of a person results, for any term or for life. d. Included in 803: harboring or concealing terrorists e. Included in 805: Material support 18 USC 2339A f. 806 Assets: "of any individual, entity or organization engaged in planning or perpetrating any act of domestic or international terrorism" and all assets, "affording any person a source of influence over any such entity or organization." g. USAPA sec. 805. Amends 18 USC 2339A. Material support for terrorists now includes "expert advice or assistance"; e.g., biochemist's advice on how to increase lethality of biological agents. Previous 2339A included "training"; statute requires "knowing or intending that they [material support or resources] are to be used in preparation for, or in carrying out, a violation . . .. [of, inter alia, 2332b] -- so this requires knowing or intentional facilitation. Under 2339A facilitator may be culpable whether or not underlying offense committed; also, scienter does not require "specific intent to commit the underlying action," but only knowledge that "are to be used" for a specified offense -- however, normally this is interepreted to mean that facilitator "aware that that result is practically certain to follow from his conduct.'" If a facilitator was virtually certain that particular recipients would in fact use the provided resources to commit a terrorist crime, it would be immaterial whether the facilitator knew precisely when or where the criminal conduct would occur. Major First Amendment problem for information otherwise available in the public domain. IV. Sunset Provisions USAPA sec. 224. Several of the surveillance portions of the USAPA will expire on December 31, 2005. The EFF is pleased that at least some of the more severe changes in the surveillance of U.S. persons contained in the USAPA will expire on December 31, 2005 unless renewed by Congress. We are concerned, however, that there is no way for Congress to review how several of these key provisions have been implemented, since there is no reporting requirement to Congress about them and no requirements of reporting even to a judge about several others. Without the necessary information about how these broad new powers have been used, Congress will be unable to evaluate whether they have been needed and how they have been used in order to make an informed decision about whether and how they should continue or whether they should be allowed to expire without renewal. A. The provisions that expire include: Sec. 201. Authority To Intercept Wire, Oral, And Electronic Communications Relating To Terrorism. Sec. 202. Authority To Intercept Wire, Oral, And Electronic Communications Relating To Computer Fraud And Abuse Offenses. Sec. 203(b), (d). Authority To Share Criminal Investigative Information. Sec. 206. Roving Surveillance Authority Under The Foreign Intelligence Surveillance Act Of 1978. Sec. 207. Duration Of FISA Surveillance Of Non-United States Persons Who Are Agents Of A Foreign Power. Sec. 209. Seizure Of Voice-Mail Messages Pursuant To Warrants. Sec. 212. Emergency Disclosure Of Electronic Communications To Protect Life And Limb. Sec. 214. Pen Register And Trap And Trace Authority Under Fisa. Sec. 215. Access To Records And Other Items Under The Foreign Intelligence Surveillance Act. Sec. 217. Interception Of Computer Trespasser Communications. Sec. 218. Foreign Intelligence Information. Sec. 220. Nationwide Service Of Search Warrants For Electronic Evidence. Sec. 223. Civil Liability For Certain Unauthorized Disclosures. B. The following provision do not expire: Sec. 203(a),(c): Grand jury sharing of info Sec. 208. Designation Of Judges: increases number of FISA judges Sec. 210: ECPA Scope of Subpoenas for records of electronic communications--clearly allowing e-mails routing information : Sec. 211: ECPA Clarification of scope: privacy provisions of Cable Act overridden for communication services offered by cable providers (but not for records relating to cable viewing) Sec. 213: Sneak & Peek: delay notification of execution of a warrant Sec. 216: Modification of pen/trap authorities: (in original PATRIOT, would have sunsetted) Sec. 219: Single jurisdiction search warrants for terrorism Sec. 222 Assistance to law enforcement Sec. 225. Immunity For Compliance With Fisa Wiretap. Can continue all investigations active at the time of expiration. OPERATION TIPS FACT SHEET Operation TIPS (Terrorism Information and Prevention System) was introduced as a program in development in January 2002. This document contains information a bout the background and purpose of the program as it has developed over the past six months, a list of the industries that will be invited to participate in the final program, specific information about the design of the reporting system, and information about existing similar systems. OVERVIEW This reporting system is being developed by the Department of Justice in coordination with several other federal agencies, including the Office of Homeland Security, the Department of Labor, the Federal Bureau of Investigation, and FEMA, as a part of Citizen Corps. The program was announced in concept in January 2002 for the stated purpose of creating a national information sharing system for specific industry groups to report suspicious, publicly observable activity that could be related to terrorism. The program is scheduled to be operational in the fall of 2002 as one of the new Citizen Corps programs. The initiative's design is based on existing programs, such as Highway Watch and Coast Watch, that allow truckers and ship captains to report dangerous conditions along their routes. In response to significant demand among industry groups, Operation TIPS would make these programs available nationwide by providing specific industry groups a single phone number for reporting potentially terrorist-related activities occurring in public areas. Specifically, industry groups have looked to the Justice Department to offer a r eliable and cost-effective system that their workers could use to report information to state, local, and federal law enforcement agencies about unusual activities they might observe in the normal course of their daily routines. Similarly, law enforcement agencies have sought a system for receiving terrorist tips that would avoid overburdening the 911system. The Operation TIPS hotline would also offer some unique improvements upon current systems by: Providing a centralized telephone hotline and web-based reporting system that automatically and immediately routes tips to appropriate federal, state, and local law enforcement nationwide; Providing specific industry groups with a means of reporting non-emergency, potentially terrorist-related activity; and Enabling law enforcement officials to "connect the dots" and take appropriate action on potentially terrorist-related activities that may be occurring simultaneously. INDUSTRIES Industries interested in participating will be given printed materials on how to contact the reporting center, and would in turn provide information and any training to their workers directly. Many industries already provide this type of information as part of their security and job training. Operation TIPS would offer its hotline service to workers involved in the transportation, trucking, shipping, maritime, and mass transit industries. Industry associatio ns and groups in these areas will be invited to receive information about the hotline so their workers can participate in the program if they so choose. Other industry associations involved in the above-mentioned industries could also seek participation by contacting the Department of Justice. At the outset of the program, the Department of Justice planned to engage the postal and utility industries to participate because their workers maintain regular public routes in the communities they serve, putting them in a unique position to recognize potentially dangerous activity along transportation routes and in public places. In addition, the inclusion of postal workers and utility workers made sense because they have been identified as targets for terrorism. Postal workers in New Jersey and Washington, D.C. were victims of the anthrax terrorist attacks last year, and postal workers across the country were affected by the recent pipe bomb attacks. As attac ks on utility plants and water systems could affect the public health and safety of millions of people, these facilities have long been considered prime targets of domestic and international terrorism. The Department never intended that workers calling the hotline would report on anything other than publicly observable activities. However, given the concerns raised during the program development phase about safeguarding against all possibilities of invasion of individual privacy, the Department of Justice has decided that the hotline number will not be shared with any workers, including postal and utility workers, whose work puts them in contact with homes and private property. REPORTING SYSTEM The National White Collar Crime Center (NW3C) is a non-profit corporation whose membership includes law enforcement agencies, state regulatory bodies with criminal investigative authority, and state and local prosecution offices. NW3C has offered to host the hotline call center. They can also provide the technical infrastructure and personnel for the project. The hotline project would be funded by a grant from the Bureau of Justice Assistance for approximately $800,000 (FY'02 funds) to establish and operate the call center. NW3C has the capacity to both receive information via the hotline and through electronic submissions of information, and to serve as a central point for distribution of that information to the app ropriate law enforcement agencies at all levels. The information received can be routed automatically to law enforcement agencies through virtual private network (VPN) technology, National Law Enforcement Telecommunication System (NLETS) transmission, or encrypted data transmission via the Internet. The information can be submitted using Secure Sockets Layering (SSL) technology to ensure the confidentiality of the submitter. NW3C can facilitate information flow to state, loca l, and federal entities that want to receive information from the TIPS hotline through stakeholder meetings with each state. Agencies opting to receive TIPS information would be responsible for determining how to respond to the tips they receive. Based on information from existing hotlines, it is estimated that the reporting center would receive 12-25 calls each month per every 1,000 workers in the participating industries. EXISTING SYSTEMS/HOTLINES The following is a list of some of the similar programs and hotlines already in operation around the country. They do not accomplish the same goals as Operation TIPS and/or receive information from the same groups of people, but they illustrate the effectiveness of such programs in addressing public safety needs: Coast Watch Maritime industries currently report all chemical, radiological, etiological, oil and biological releases to the National Response Center, w hich has expertise in dealing with the release of hazardous materials and emergency situations. Highway Watch Created by the American Trucking Association in 1998, this national safety initiative trains professional truck drivers to recognize and report a variety of incidents-such as stranded motorists, drunk drivers, changing road conditions, poor signage, accidents, etc. The American Trucking Association wants to expand this program beyond the six states currently served and to include terrorism prevention. River Watch This program is based in Michigan and engages the boating public and shoreline owners and operators to assist the Michigan State Police and relevant federal agencies in protecting the borders from illegal entry into the country by undocumented aliens, drug smuggling, etc. AMBER Alert The AMBER Plan, created in 1996 as a powerful legacy to 9 year-old Amber Hagerman who wa s kidnapped and murdered in Texas, is a voluntary partnership between law-enforcement agencies and broadcasters to activate urgent bulletins in the most serious child-abduction cases. The goal of an AMBER Alert is to instantly galvanize the entire community to assist in the search for and safe return of the child. The AMBER Alert system was responsible for the recent rescue of two teenage girls who were abducted in California. Truckers and motorists were engaged in looking for the girls after they were alerted to the description of the suspect's vehicle. An anonymous tip from a motorist ultimately led to the safe return of the girls. Treasury Department's Financial Crimes Enforcement Network (FinCEN) FinCEN established a Financial Institutions Hotline for the voluntary reporting to law enforcement of suspicious transactions that may relate to terrorist activity. The purpose of the hotline is to facilitate the immediate transmittal of t his information to law enforcement. 1-800-BeAlert Hotline The U.S. Customs Service provides the 1-800-BeAlert Hotline to allow the general public to report violations of federal law enforced by the U.S. Customs Service, such as the smuggling of drugs, jewelry, etc. Bureau of Alcohol, Tobacco, and Firearms (ATF) ATF has four nationwide hotline programs: 800-ATF-GUNS, 888 ATF-BOMB, 888 ATF-FIRE, and 888 STF- TIPS, each of which was created in the mid or late 1990s. These toll-free numbers give members of the public the means to report any suspected criminal misuse of firearms, bombing activity, arsons, and general criminal activity. According to ATF, in 2001, hundreds of significant investigative leads were received on the hotlines and were referred to the ATF field offices for follow-up investigation. Massachusetts Transit Crime Watch In December of 1998, the Massachusetts Neighborho od Crime Watch Commission (MNCWC) and the Massachusetts Bay Transportation Authority (MBTA) Police Department launched Transit Crime Watch, a unique crime watch program designed to provide crime prevention education to the one million passengers who ride the MBTA daily. The program instructs and encourages commuters to contact the police when they observe an emergency situation, suspicious activity, or a crime in progress. Signs are posted both on and around each subway line, bus ter minal, and commuter rail station advertising the MBTA Police phone number and promoting the use of emergency call boxes to report crime and suspicious activity. Terrorist Tipline The National White Collar Crime Center (NW3C) was selected by Attorney General John Ashcroft immediately following the terrorist attacks of September 11 to serve as the single on-line portal for the public to report information regarding terrorist activity to the FBI. To date this pag e has received more than 200,000 tips from the public. We at EchelonWatch are deeply saddened by the terrible events of September 11. We extend our deepest sympathies to the victims and their families. We support vigorous and appropriate actions by intelligence and law enforcement agencies to prevent more attacks from taking place. The goal of EchelonWatch is not to disband legitimate intelligence operations but to insist that they be subject to proper oversight. It is now more important than ever to subject powerful surveillance systems to the proper oversight and control by the institutions of democratic government. Effective operation against terrorists and strong oversight are not at all incompatible. We expect that in the coming months, the redoubled effort to prevent terrorism will lead to an expansion of Echelon and the related communications surveillance systems. Unfortunately, history shows that times of national crisis are often accompanied by enormous pressure to expand surveillance in ways that threaten privacy and civil liberties without enhancing security, such as spying on lawful political activities. That is why Congress and the democratic institutions of other nations must take their oversight responsibilities more seriously - making sure not just that the system is effective, but also that its capabilities are well understood, and that it isn't used to violate our privacy and civil liberties. Echelon is perhaps the most powerful intelligence gathering organization in the world. Several credible reports suggest that this global electronic communications surveillance system presents an extreme threat to the privacy of people all over the world. According to these reports, ECHELON attempts to capture staggering volumes of satellite, microwave, cellular and fiber-optic traffic, including communications to and from North America. This vast quantity of voice and data communications are then processed through sophisticated filtering technologies. This massive surveillance system apparently operates with little oversight. Moreover, the agencies that purportedly run ECHELON have provided few details as to the legal guidelines for the project. Because of this, there is no way of knowing if ECHELON is being used illegally to spy on private citizens. This site is designed to encourage public discussion of this potential threat to civil liberties, and to urge the governments of the world to protect our rights.
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