Tuesday, October 30, 2007

Dollar to Take a Dive, says IMF Head

Prensa Latina
October 27, 2007

IMF (International Monetary Fund) director, Rodrigo Rato, forecast that the dollar is due for a disorganized and pronounced fall.

In declarations to the press, Rato said that the greenback may continue to fall rapidly, which, he added, would complicate the credit crisis in the United States.

Rato said there was a possibility of a worldwide recession in 2008 but this would not be his most important forecast.

“There is another scenario. A lesser economic growth in the United States, which would have an impact on Europe and Japan,” maintained Rato who is soon to leave his post in the IMF.

He also indicated that there is danger of a growing inflation as a result of the high oil prices, but also the hike in food product prices.

World markets suffered strong turmoil during the past two months from the mortgage risk in the United States.

“All these dangers come at a time when the world economy now confronts risks, unbalances, protectionism and high oil prices,” Rato concluded.

Just East of Eden: Iran, images and reflections

Gaither Stewart
Online Journal
Oct 30, 2007

While the drums of war roll and the US president invokes economic sanctions against Iran and continues to speak of World War III, questions and more questions emerge from the disastrous past of US-Iran relations. In this climate and after the great lie about Iraq, one is justified to wonder if Iran’s nuclear ambitions are the problem. The answer seems obvious — not at all. Oil is the issue.

Oil is always the issue when official America speaks of Iran.

Are the president’s threats of war against Iran simply electoral propaganda? Many Europeans believe so. For, they reason, America cannot sustain another military front. Europeans believe the president’s rhetoric is bluff, though a dangerous bluff, because it is combined with America’s historical engrained ignorance about Iran.

One recalls that as late as August 1978, the CIA predicted that the regime of Mohammad Reza Shah Pahlavi in Iran could easily last another 10 years. Despite revolts exploding all over ancient Persia, Western businessmen believed this, too, and swarmed over the country in search of lucrative contracts originating in the corrupt court of the Shahinshah in Tehran. Right up to the Shah’s end, Iran was a feast for Westerners. Even after the entire nation knew of the torture the Shah’s American trained secret police, SAVAK, practiced on dissidents and anyone even suspected of being subversive in the dreaded Evin prison in the western part of the mountainside city.

As an employee and Italian-English interpreter (it seemed nearly everyone in Tehran spoke English!) for a group of Italian companies, I was in the ancient and captivating country of Iran for much of the time during late 1977 and the year of 1978, up until the revolution was well underway. Iran, as most foreigners who have lived there will testify, is a special country, the kind that gets in your blood. Not all the foreigners were there for the money. Maybe it’s the dry heat in the summer, or the cold winters, or those enormous purple mountains ever present. I met foreigners who had been there almost forever. They didn’t want to leave. They were much like Iranians who like to travel, even emigrate, but they’re always drawn back home. They never leave completely.

While the CIA was making its rosy Iran situation reports, I witnessed the disintegration of the Iran created by the American puppet, Shah Pahlavi. The pre-revolution was a period when curfews kept the streets relatively clear after 8 or 9 o’clock; yet young people claimed that the resistance controlled the city after midnight. University students everywhere were on the warpath. The first students were shot down by the Shah’s police in the holy city of Qom itself.

Then, on ‘Black Friday’ in that same August 1978, the Shah’s troops opened fire on the mobs on a Tehran square killing hundreds or thousands. From day to day, millions of inebriated marchers, their lances lifted toward the heavens, screamed for the heads of the Pahlavis and waved their banners for the Ayatollah and the Islamic Republic. Inexorably, but much more quickly than expected, the circles tightened around the Shah and US interests there. The ‘people’ were exhilarated. People learned the lesson that the poor learn easily — how easy it is to die . . . and to kill. On the streets of Tehran, you smelled stale gas and felt the terror in the air. Tensions palpitated under the plaster of the great avenues. Mystery and suspicion smoldered under the tall trees up Khiabon Pahlavi to the north. No one knew for certain what was happening but the whole city stank of greater battles to come.

It stank of revolution.

I found it strange that in the growing chaos they continued working on new streets, somehow emblematic of the enduring millenary continuity of Persia-Iran. Still alive is the image of workers sleeping in tents under viaducts, their gray-black feet sticking out of the openings, the canvas flapping in the morning breeze.

Then when the great summer heat ended, they no longer worked at night under the floodlights with the pounding jackhammers that made the earth quiver and quake. In September, a general strike paralyzed the country. The young cab drivers at the traditional old hotel where I lived spoke openly of how they would hang the Shah and cut off the heads of the SAVAK beasts. All those wild kids! Leftists all, doomed to be devoured by the revolution they helped make.

Conservatives and foreign businessmen wondered when the Shah would make his move? What were their American protectors doing? Yet, you could smell it, the revolution. It was in the air. Sometimes I would try to tell the businessmen what was happening. But none of the company executives or the investors felt it; they were still intoxicated by the brilliance of past Persian glories and the apparent permanence of the Pahlavi dynasty. They didn’t want to know the reality either. Their investments in the Shah’s Iran were too great.

But the revolution was there.

In Tehran in 1978 you didn’t know who was who. Monarchists and Communists and Mullahs, and Islamic Marxists were everywhere making the revolution.

Yet, at night in the hotel bar time stopped. It was a sad and lonesome place, like all the hotel bars in all the African capitals of all the former European colonies. A place for lonely men. Images: a businessman sitting alone in a corner holds his glass in mid-air as if considering the evanescence of love and time. American technicians in dirty work clothes are loud at a big table in the middle. A Frenchman in a far corner stares vacantly and with a forefinger traces circular images in the moisture on the plastic tabletop. A waiter passes among them all with trays loaded with drinks.

On the other side of the world, Washington was paralyzed. No one there knew what to do. No one seemed to realize that the Shah’s glass castle was cracked and breaking on all sides. While the SAVAK continued to torture subversives and martial law became more and more severe, Ayatollah Khomeini moved from his exile in Najaf in Iraq to Paris, manifestations mushroomed throughout the country, and in front of my eyes young soldiers threw away their guns, jumped down off their military trucks and sided with the people. The Shah had lost control of the nation. Yet, Westerners were still blind. They waited for the US to move. German and French and Italian and Dutch work teams drove out of downtown hotels each morning to their works sites in the mountainous surroundings as if nothing of great significance were underway.

Paradoxically, in the later period, I attended a meeting, in a downtown office building, organized by Bechtel Corporation to celebrate the opening of its huge office in Tehran with over 100 employees. Close to political power and the CIA in the USA, the Bechtel engineering and construction company from San Francisco is dedicated, in its own words, ‘to making money.’ But it also helps to overthrow foreign governments judged unfriendly to US interests. Yet, in Iran, Bechtel and the US government failed miserably. It did nothing. It could do nothing, and its men vanished. Today, I note, Iran is not even listed among the many countries where Bechtel has worked to further American interests and to make money. Its history is not only a story of duplicity but also of incompetence.

Meanwhile, in Iran, chaos reigned. It was revolution!

Washington had total confidence in the Shah’s American-armed military forces that had made Iran the gendarme of the region. The entire West seemed as surprised and incredulous as were the businessmen I was associated with, who had counted on the US Marines to put things right. It couldn’t happen here, they all thought.

The Iranian Revolution was a severe blow to US power in the Middle East from which the world power has never recovered. The miscalculations, misjudgments and blindness to reality concerning Iran of 29 years ago have led the USA down erroneous paths ever since.

The subsequent history is well known. In January of 1979, the Shah fled to Egypt. In February, Ayatollah Khomeini returned from exile to become the leader of the emerging Islamic Republic of Iran where he was regarded as a semi-God.

Islam had invaded politics.

In February, Iranian students occupied the US Embassy in Tehran and its personnel became hostages, forcing the Ayatollah to side with the ferociously anti-American students. This was Iran’s sweet revenge for the US-organized coup d”tat that overthrew Premier Moussadeq in 1953 for his nationalization of Iran’s oil (read Iran, stop and always think oil!) and re-installed the amenable Shah on the throne.

The American hostages stayed put for over a year. New Iran didn’t really know what to do with them. It didn’t how to negotiate. The fundamentalists were busy making the Islamic republic and Khomeini learning to control power. What did the young revolutionaries, the mujahadeen and the Socialists and the Communists care? What did they care about diplomatic and international rules and niceties? This was not a tea party; this was revolution.

Iranians exulted again at the fiasco of the US military attempt to rescue the hostages. Another slap in Washington’s face. Oh, how they seethed on the banks of the Potomac. All their assessments were wrong, all attempts to salvage something from the disaster wrong, wrong timing, wrong policies.

So, in 1980 American-armed Iraq conveniently attacked Iran in chaos, while Washington turned up the heat and upped its own confusion by secretly selling more arms to Iran. Yep, to revolutionary Iran! In order to pay for the dirty war against the new leftwing Sandinista government in Nicaragua. The Iran-Contras scandal. La drole de guerre! America arms both sides. Until Iraq launched its Us-provided chemical warfare, killing thousands of Iranians.

Nonetheless, Iraq could never come near defeating Iran, no more than American armies today or its Blackwater mercenaries could defeat ancient Iran whose history reaches back to the beginnings of time. Iran is not tribal Afghanistan or artificially created and manipulated Iraq. From the Persian Gulf to the Caspian Sea, from villages of the Elbruz Mountains to the magic fountains of Isfahan, Iran is solidity. Iran is durability, part of our cultural heritage. This is territory of ancient peoples; according to some theories, the location of the mythical Garden of Eden and Cain’s land of Nod, somewhere East of Eden.

US, Israel support PKK

Press TV
October 29, 2007

PKK Kurdish rebel group and its sister organization, PEJAK, have been receiving support from the US and Israel, an American journalist claims.

“In the past months, Israel and the United States have been working together in support of PKK and its Iranian offshoot PEJAK, I was told by a government consultant with close ties to the Pentagon,” said Pulitzer Prize-winning, Seymour Hersh.

In an interview with Turkish gazette, Zaman, the leading American investigative journalist also revealed that the White House has lost control over PKK which has gone rogue.

Earlier, the renowned American journalist accused Washington and the Zionist regime of providing PKK and PEJAK with ‘training and equipment’ in a secret ploy to destabilize the region.

Commenting on PEJAK, Hersh asserted that Washington considers it as “part of an effort to explore alternative means of applying pressure on Iran.”

The Party for Free Life in Kurdistan (PEJAK) has been behind a string of deadly attacks on security forces in northwestern Iran. PEJAK is considered a terrorist group by Turkey, the United States, and the European Union.

Jeremy Scahill: US war of conquest in Iraq

FBI Whistleblower Sibel Edmonds to Tell All

Brad Friedman
Brad Blog
October 29, 2007

Attention CBS 60 Minutes: we’ve got a huge scoop for you. If you want it.Remember the exclusive story you aired on Sibel Edmonds, originally on October 27th, 2002, when she was not allowed to tell you everything that she heard while serving as an FBI translator after 9/11 because she was gagged by the rarely-invoked “States Secret Privilege”? Well, she’s still gagged. In fact, as the ACLU first described her, she’s “the most gagged person in the history of the United States of America.”

But if you’ll sit down and talk with her for an unedited interview, she has now told The BRAD BLOG during an exclusive interview, she will now tell you everything she knows.

Everything she hasn’t been allowed to tell since 2002, about the criminal penetration of the FBI where she worked, and at the Departments of State and Defense; everything she heard concerning the corruption and illegal activities of several well-known members of Congress; everything she’s aware of concerning information omitted and/or covered up in relation to 9/11. All of the information gleaned from her time listening to and translating wire-taps made prior to 9/11 at the FBI.

Here’s a handy bullet-point list, as we ran it in March of 2006, for reference, of what she’s now willing to tell you about.

“People say, ‘why doesn’t she just come forward and spill the beans?’ I have gone all the way to the Supreme Court and was shut down, I went to Congress and now consider that shut down,” she told The BRAD BLOG last week when we spoke with her for comments in relation to our story on former House Speaker Dennis Hastert’s original attempt to move a resolution through the U.S. House in 2000 declaring the 1915 massacre of 1.5 million ethnic Armenians in Turkey as “genocide.”

“Here’s my promise to the American Public: If anyone of the major networks — ABC, NBC, CBS, CNN, MSNBC, FOX — promise to air the entire segment, without editing, I promise to tell them everything that I know,” about everything mentioned above, she told us.

“I can tell the American public exactly what it is, and what it is that they are covering up,” she continued. “I’m not compromising ongoing investigations,” Edmonds explained, because “they’ve all been shut down since.”

“She’s Very Credible”

She has, in fact, spent years taking every reasonable step to see that the information she has goes through the proper channels. The Supreme Court refused to hear her whistleblower lawsuit, even in light of the Department of Justice forcing the removal of both her and her own attorneys from the courtroom when they made their arguments concerning why it was that she still had to remain gagged under the “States Secrets Privilege.”

On the morning that the SCOTUS refused to hear her case, the facade cracked on the front of the building. In a ridiculously ironic metaphor which would have been rejected by any credible screen-writer, a chunk of marble — just above an allegorical statue representing “Order” and just below the words “Equal Justice” — came crashing to the ground.

She has met with, and told her story to, U.S. senators including Republican Charles Grassley and Democrat Patrick Leahy, both of the Senate Judiciary Committee, both who found her extremely credible. 60 Minutes producers may remember when Grassley told them, “Absolutely, she’s credible…And the reason I feel she’s very credible is because people within the FBI have corroborated a lot of her story.”

In fact, the FBI itself has done so. Their Inspector General found her allegations, as described in the unclassified version of his report, to be “credible,” “serious,” and “warrant[ing] a thorough and careful review by the FBI.”

As far back as 2002, Grassley and Leahy co-wrote letters on Edmonds’ behalf to Attorney General John Ashcroft, FBI Director Robert Mueller, and DoJ Inspector General Glenn A. Fine, calling on all of them to take action in respect to the allegations she’s made.

“Certain officials in this country are engaged in treason against the United States and its interests and its national security,” she said during an interview an August 2005 interview on Democracy Now. That comment followed 60 Minutes’ revelation years before alleging that Edmonds had information revealing that a “Turkish intelligence officer” she worked with at the FBI “had spies working for him inside the US State Department and at the Pentagon.”

She’s briefed many legislative offices — as well as the 9/11 Commission — in regard to her claims, and now, she says, she’s even prepared to tell the media “the names of every single Congressional office who has received the names of the witnesses” to the crimes she’s detailed.

When we spoke last week, Edmonds seemed to reserve most of her frustration for Congressman Henry Waxman’s office. Waxman is the Democratic Chairman of the U.S. House Government Reform and Oversight Committee.

After briefing members of his security-cleared staff “inside the SCIF” — a high-security room in the U.S. Capitol, specially created for discussion of highly sensitive information — Edmonds says she was told on several occasions, prior to the 2006 Election, that her case would be one of the first heard in his committee, once he became Chairman.

“I even gave names of former and current FBI agents who were willing to go to Waxman’s office and give more information on all of this,” she said.

“Before the elections, I had a promise from Congressman Waxman’s office.” She claims they told her, before the election, “the only reason they couldn’t hold hearings, was because the Republicans were blocking it.”

“They said ‘your case will be one of the first ones we will hold investigations on,’” she told us. Now, however, since the Democrats have become the majority in the House, Waxman’s office is “going mum.” They won’t even respond to her calls.

The congressman’s office did not respond to several requests for comment on this story.

Two Other “Well-Known” Congressmen

Aside from the allegations she’s already made concerning Hastert, as we reported in some detail in early 2006, following up on a Vanity Fair exposé in 2005, Edmonds says there are at least “two other well-known” members of Congress that she’s prepared to name as well.

“There are other Congressional people, whose names have not come out,” she explained. “As [Waxman’s office knows] I’ll be able to give them file numbers and investigations, including investigations by the IRS. I will be giving details one by one, not just allegations.”

“But,” she added, “unfortunately nobody wants to have an investigation like that.”

For the record, she told The BRAD BLOG, the other two “well-known members” are from the House, both Republican, and “one of them is recently no longer there.”

So far, she says, “those names have not been public.”

“Kafka-esque”

Since leaving the FBI, and in the wake of her years-long ordeal, which she frequently describes as “Kafka-esque,” Edmonds has founded the National Security Whistleblowers Coalition.

In addition to the support she has received, at various times, from members of Congress, she’s received a great deal of support from members of the national security whistleblower community and government watchdog organizations.

As we reported last Spring, Veteran FBI counterintelligence agent John Cole has said he’s “talked to people who had read her file, who had read the investigative report, and they were telling me a totally different story” than that given publicly by FBI officials. “They were telling me that Sibel Edmonds was 100 percent accurate,” he said, “management knew that she was correct.”

Famed “Pentagon Papers” whistleblower Daniel Ellsberg has described Edmonds as “extremely credible.” In a 2005 interview on KPFA, Ellsberg said, “FBI agents we’ve talked to have, in every respect that was raised, have confirmed her story - that she’s a very credible witness.”

More than 30 groups, from across the political spectrum — including the Project on Government Oversight (POGO), Citizens for Responsibility and Ethics in Washington (CREW), the American Civil Liberties Union (ACLU), the September 11th Advocates, the Liberty Coalition, the Electronic Frontier Foundation (EFF), OMB Watch, Electronic Privacy Information Center (EPIC) and People for the American Way (PFAW) — all signed a letter in March of this year calling on the House Oversight Committee to “hold public hearings into the case of FBI Whistleblower Sibel Edmonds, and the erroneous use of the State Secrets Privilege to shut down all court proceedings in her case.”

That petition was sent almost precisely one year after The BRAD BLOG originally reported on a public petition to Congress, demanding they hold public hearings. More than 30,000 people, Edmonds says, have now signed that petition since it was first announced.

“Exhausted Every Channel”

In a speech given over the Summer in D.C. at the American Library Association (ALA, video here), Edmonds detailed the “Kafka-esque” nature of her unprecedented gag-order. Among the information still-regarded as “classified” under the States Secret Privelege: the fact that she was a translator for the FBI, where she was born, what languages she speaks, the date of her birth, the universities she attended, and the degrees she earned.

In fact, the interview that CBS’s 60 Minutes aired with her in 2004, was later retroactively classified by the Department of Justice under the same “privilege”!

But enough is enough. She’s now ready to tell all. To the public. But not (yet) to us. She will speak, however, to any broadcast network that would like to have her.

“I have exhausted every channel. If they want to, they can bring criminal charges against someone who divulges criminal activity, and see how far they’re going to get.”

But will any of the corporate mainstream networks take her up on the offer? It’d certainly be an explosive exclusive.

“I don’t think any of the mainstream media are going to have the guts to do it,” she dared them.

So whaddaya say 60 Minutes? We’ve given you scoops before that you ended up turning down — and likely later regretted. Will you be smart enough to take this one?

“You put me on air live, or unedited. If I’m given the time, I will give the American people the exact reason of what I’ve been gagged from saying because of the States Secrets Privilege, and why it is that I’m the most gagged person in the history of the United States.”

“My feeling is that none of them have the guts to do that,” she dared them, before charging, “they are all manipulated.”

“I keep using the word Kafkaesque…” she paused, during her speech at ALA, clearly showing her exasperation, “because…,” she continued slowly, “…I really can’t come up with a better word.”

David Horowitz Awareness Week: Islamo-Fascism Comes to Columbia

A.C. Bowen
Lew Rockwell
October 30, 2007

12:18 and still no David Horowitz. Typical of Columbia to start the program late. Roone Arledge Cinema, one of the smaller auditoriums on campus, was ¾ full of mostly white, mostly male, mostly Republican spectators, and they were getting restless. Four middle-aged Communist protesters were stationed outside in the rain handing anti-Horowitz handbills to students who had come to Lerner Hall for the engineering job fair. No one bothered to inform the protestors that they were at the wrong door. Finally, a hush fell over the crowd as a faceless Columbia bureaucrat assumed the speaker’s position in order to remind us to turn our cell phones off and avoid yelling Communist slogans once the speech began.

Polite applause greeted Horowitz’s appearance at the speaker’s podium. I was a bit disappointed myself, having expected a tall, grand, imposing figure with a posh accent in the mould of William F. Buckley circa 1968. Horowitz is short, rotund, balding, and speaks in a nasal, pseudo-Brooklyn twang. They don’t make ’em like they used to. Then again, considering Buckley’s overweening neo-conservatism, it seems they never did.

Horowitz led off with a few pleasant generalities about his alma mater, but soon strayed into more contentious territory. Columbia used to be a friendlier place 52 years ago, said he. Professors kept their political opinions to themselves and all viewpoints – even his own Communist one, a very unpopular one at the height of the era of McCarthyism – were tolerated from students. Now, alas, all the conservative faculty has been purged and the militant leftist academics (activists first and scholars second, natch) who remain wish to bring us back to the teaching methods of the 19th century, when professors at religious colleges merely spouted their doctrines and presented no opposing viewpoint to students. To be a conservative on campus these days, Horowitz said, is a character-building experience. As a student at a college which spoon-feeds pseudo-Marxist pablum to all of its incoming students through its much-vaunted Core Curriculum, I must agree in principle, if not in detail. At least we have Islamo-Fascism Awareness Week on 114 campuses (I thought it was 200 campuses, David? You’d better update your website) this week, though. That’ll show them terrists.

After outlining his basic views on the liberalization of our universities, Horowitz chose to enlighten the listeners about his reasons for creating the Week. There is nothing about the Week or its rhetoric, he said, which could or should be construed as anti-Islam or anti-Muslim. The Week, it seems, is all about separating the moderate Muslims from the Islamo-Fascists, and praising the former while decrying the latter. In fact, the very term Islamo-Fascism was coined by Muslims – Algerian Muslims, to be exact – who wished to speak out against the Islamic militant groups which had killed 150–200,000 of their co-religionists. He – Horowitz – first picked up the term from Christopher Hitchens, and thus did not think of it himself. In his Slate article, Hitchens disagrees with this description of the term’s provenance, but agrees with Horowitz’s use of it.

Horowitz went on to echo much of what Hitchens said in his article. That is, Islamic regimes have a long history of being Fascist. The Grand Mufti of Jerusalem was an acolyte of Hitler and wished to set up death camps for Jews in the Middle East modeled on ones in Germany and elsewhere. The Iranian Republican Guard, he said, goose-steps in homage to the SS. (Funny that the Russians – haters of all things Nazi – still goose-step as well.) Islamo-Fascists, Horowitz said, are first and foremost at war with moderate Muslims and Islamic countries whose regimes are not hyper-religious. As evidence he cites al-Qaeda’s bombing of a wedding in Iran. Actually, the bombing was in Jordan. (The US has certainly never blown up a wedding, has it? Okay, that one was a mistake. This one wasn’t.)

Why does any of this matter? Horowitz has an answer for that as well. We’re at war, he said, and “you can’t fight a war unless you can name your enemy.” Alas, all too often the enemy is right here at home. Sami al-Arian, for instance. Horowitz claims that al-Arian held pledge drives to raise money for Islamo-Fascist groups. “$500 to kill a Jew,” to be precise. This shows, he says, that leftist professors are in league with Islamo-Fascists around the world. In Horowitz’s words, the left “tried to save Saddam” and are now “supporting the nuclear program of the Persian Hitler.”

Ah, the “Persian Hitler” – still Columbia’s enemy du jour. Horowitz went on at some length about human rights abuses in Iran. Did you know that Ahmadinejad has just passed a law saying that couples can’t hold hands in public, and that this edict will be enforced by the Morality Police? Neither does the mainstream media. He’s right about one thing, though: hatred for America in the Middle East did not start with Bush. Horowitz blames it on Jimmy Carter. Then Clinton wanted to invade Iraq and the “entire Democratic congress was for it” but unfortunately this was in 1998, and Clinton got himself embroiled in more important matters with a certain “cupcake.” Damn those missed opportunities. Of course, when it came time for Bush to bomb Iraq, the Democrats reversed their former support.

Why, then, are we at war with Iraq? Because we’ve always been at war with Iraq. The Gulf War, he says, ended with a treaty. Part of the treaty involved Saddam not gassing Kurds any more, and the other part of the treaty involved Saddam allowing weapons inspectors into Iraq to search for weapons. Saddam violated both parts of this treaty and thus asked us to attack him. So that’s the reason, then. Nothing about yellowcake uranium or cooperation with al-Qaeda or anything else.

Now that we “know our enemy” and have a justification for fighting him, what would happen if we left Iraq? Hundreds of thousands of moderate Muslims would die. You know, “everyone who voted in the election that George Bush made possible”? Yeah, them. All dead. Iran would become the “major power” in Iraq and would invade all of its neighbors for “not being Muslim enough.” That having been done, Ahmadinejad would “wipe America off the map” just like he said in his Colu… wait. I seem to remember having watched that speech in person, but what I don’t remember is Ahmadinejad saying that he wants to wipe America off the map. Or Israel, for that matter. But Horowitz said he “watched the speech” and heard Ahmadinejad threaten to kill us all (”because if they detonate a dirty bomb in New York, it won’t distinguish between liberal and conservative”), so maybe my memory is failing. “That’s a gun to your head,” he kept reminding us. I suppose that questions about the morality of Osama’s guns versus Bush’s guns are better left to philosophers.

That’s okay, though, said Horowitz. None of the above horrors will come to pass because we’re not going to leave Iraq. Bush won’t leave it, and Hillary won’t leave it when she’s elected. Let’s repeat that, shall we? She won’t leave Iraq when she’s elected. (The slightest possibility makes you want to give your entire paycheck to Ron Paul.) The problem with that, he said, is that we’re fighting them over there, but we won’t fight them here. “Why are the traitorous New York Times editors not in jail?” he yelled. “They revealed state secrets in the middle of a war. In the middle of a war!” Same goes for the traitor Cindy Sheehan, whom Horowitz thinks should be cooling her heels in the next cell.

Horowitz continued for about 45 minutes in that same vein. Then came the question and answer session, with questions having been submitted in advance and fully vetted by the College Republicans. Of course, the questions were real softballs. “Why only Islamo-Fascism? What about American fascism?” Horowitz said that anyone who considered that America was at all fascist is “delusional.” Next question. “Are you familiar with the rate of tenured female professors in Iran?” “No.” Next question. “Why does the US deal with Islamo-Fascist regimes like Saudi Arabia?” “Unfortunately it’s a complicated world. ” The Saudi royal family is “corrupt and evil,” but because of environmental radicals we need Saudi oil and thus we need them as our allies, he said. Apparently, my question about the hypocrisy of his decrying of human rights abuses in Iran while promoting some of those very same abuses in the US wasn’t deemed worthy of his consideration.

As a parting thought, Horowitz offered this translation of the first amendment: that it is the right of individuals to make utter fools of themselves in public. If that translation is correct, then he is one of the nation’s foremost exploiters of the first amendment and ought to be congratulated. So, sir, my hat is off to you for having the cojones to promote your particular brand of neo-conservatism on 114 (or 200) college campuses. Similar kudos to the Columbia University College Republicans for providing Horowitz with enough rope to hang himself and a convenient forum to do it in.

Neocons Dream Up Nefarious Alex Jones - Ron Paul Plot

Kurt Nimmo
TruthNews
October 29, 2007

Neocons never rest, especially when they are tasked with shooting down the only Constitution-based presidential candidate out of fear he will, when elected, put an end to their clash of civilizations mass murder campaign.

For instance, the neocon blogger “Allahpundit,” posting on the Hot Air site, is busy accusing Ron Paul and Alex Jones of some sort of shadowy collusion. “…it seems now we’ve got money moving in both directions between America’s Greatest Patriot and this bottom-feeding Truther jackass: a $2,300 donation from Jones to Paul and a $1,300 payment this quarter from Paul’s campaign to ‘Jones, Alex.’ Assuming it’s the same Alex Jones, which seems a safe bet, pray tell what might that payment have been for?” writes the dirt-sniffing blogger.

Nothing nefarious here, folks. Indeed, Alex Jones donated to the Ron Paul campaign, as radio talk show hosts are allowed to donate to the political campaigns of their choice. As for the supposed “$1,300 payment” to Alex Jones, this was merely a refund. Jones made a mistake—he intended to donate $1,000, not $2,300, and the $1,300 was a refund. The transaction was noted by OpenSecrets, an organization covering presidential funding.

But never mind. In the demented recesses of the average neocon mind, this transaction is considered some sort of “sinister” conspiracy—one they hope may bring down the Ron Paul campaign, as the neocons want to make it look like Ron Paul is paying Alex Jones for favorable coverage on his radio show and websites.

It irks the neocons to no end that a real conservative is running for the presidency. Obviously, the cons want the snake Rudy Giuliani to reign as decider-commander in 2009—they have packed his campaign with their Machiavellian-Straussian “advisors,” including the swami of destruction, Norman Podhoretz, who never encountered a Muslim he did not want to kill, or at least make suffer by way of bunker-buster.

Finally, Rick Moran posted a partial retraction on the American Thinker site:

As far as the specific charge in my piece yesterday that the Paul campaign paid 9/11 truther and New World Order conspiracist Alex Jones $1300 in “services,” the facts of the matter are different. The “disbursement” that was paid to Mr. Jones was a partial refund of a campaign contribution made by Jones, who originally donated the maximum amount of $2300.

I regret the confusion caused by the difference between “services” rendered by Mr. Jones and the partial refund of his contribution.

Fair enough, except for the fact Moran took the opportunity to slam Alex Jones, Endgame, and Ron Paul. “Paul’s supporters will continue their campaign of intimidation against us, of that I am sure,” Moran concludes after quoting several venomous emails he received. “But I for one will not be deterred from reporting on the decidedly unbalanced and frightening nature of both his supporters and the direction his campaign would take America.”

Of course, as we live in Bushzarro world, it is not “unbalanced and frightening” that a gaggle of pernicious neocons want to launch World War IV, as they fondly call it.

For a bit more enlightenment on this story, check out the comments posted on the the Liberty Papers blog.

Martin Sheen Questions Official 9/11 Story

Paul Joseph Watson
Prison Planet
Monday, October 29, 2007

Actor Martin Sheen questioned the official 9/11 story, as well as the collapse of Building 7 and Larry Silverstein’s “pull it” comment during an anti-war march this past weekend in Los Angeles, saying that recent revelations about the attacks had caused him to have doubts.

Sheen was interviewed by We Are Change L.A. along with fellow actor Mark Ruffalo during an event hosted by the ANSWER Coalition at which around 20,000 people attended.

Emmy and Golden Globe Award-winning Martin Sheen, star of blockbuster films like Apocalypse Now and The West Wing, follows in the footsteps of his son Charlie Sheen, who publicly spoke of his doubts about the official 9/11 story back in March 2006.

Martin Sheen said that he was dubious about questioning the official story until his son introduced him to new information about the anomalies of what happened on that day.

“Up until last year, I was very dubious,” said Sheen, “I did not want to believe that my government could possibly be involved in such a thing, I could not live in a country that I thought could do that - that would be the ultimate betrayal,” he added.

“However, there have been so many revelations that now I have my doubts, and chief among them is Building 7 - how did they rig that building so that it came down on the evening of the day?” said Sheen.

Sheen also questioned the comments of Larry Silverstein, the leaseholder of the WTC complex, who told a September 2002 documentary that the decision was made to “pull” Building 7, a demolition industry term for the deliberate implosion of a structure.

“How convenient,” said Sheen, “When did they rig that building? That’s the most interesting question and I have not received a satisfactory answer - nobody could give me an answer to how you rig the building - what a coincidence - two weeks prior and then bring it down on the day, that is the one thing that I have not got a sensible answer about from anyone,” he concluded.

Sheen also stated that NORAD’s failure to follow its standard operating procedure on 9/11 was “something to wonder about”.

Click here to listen to the audio MP3.

Though Fox News and other attack dogs are likely to seize upon Sheen’s comments and run hit pieces, the National Institute of Standards and Technology itself had to admit recently that the total collapse of the twin towers at free fall speed could not be explained.

NIST also promised to investigate whether explosive devices were involved in the collapse of Building 7 in August last year.

The issue of Building 7 stoked controversy earlier this year when archive footage from news networks including BBC and CNN emerged that showed correspondents reporting the collapse the 47-story skyscraper over 20 minutes before it fell, leading some to charge that people with foreknowledge of the collapse were feeding networks a script as the events of 9/11 unfolded.

Watch the video:

Monday, October 29, 2007

George Carlin Questions "Received Reality" Of 9/11 Story

Grammy award winning comedian, actor says new investigation would be whitewash

Prison Planet | October 29, 2007
Paul Joseph Watson

Grammy-winning American stand-up comedian, actor, and author George Carlin spoke of his doubts about the official 9/11 story during a recent appearance at Borders bookstore in New York City, just a few blocks away from ground zero.

Asked what he thought of the 9/11 truth movement and how Bill Maher's show was interrupted by truthers last week, Carlin responded, "I always question the received reality."

"The consensus reality is often intentionally misleading," he added.

Asked if he would support a new investigation into 9/11, Carlin was skeptical, stating, "They don't investigate themselves in this country - it would be a whitewash, it would be like the Kennedy thing, it would be like everything."

"The people who are in charge do what they want and they will always do what they want, power does what it wants to and I wouldn't trust an investigation," Carlin concluded.

Watch the video.

Carlin was described by Comedy Central as the second greatest stand-up comedian of all time behind Richard Prior and is famous for his scathing black humor directed at American culture and the political climate.

During a recent appearance on Keith Olbermann's MSNBC show, Carlin said that America was "finished" because "no one questions things anymore" and that the population had been bought off by distractions, toys and gizmos.

Watch a stand-up routine where Carlin slams the education system and talks about the true power system that controls America.

On Track for U.S. Collapse

Michael S. Rozeff
Lew Rockwell
October 27, 2007

Bush and Cheney are steering the U.S. into a collapse. Only strong public voices by influential people can prevent the coming disaster. We desperately need for men and women who are known to the public and have credibility to speak up in the critical period ahead to avoid catastrophe.

  • A few weeks ago, Israel bombed a alleged nuclear facility in Syria. This is a warm-up for an attack on Iran.
  • In the last few days, the U.S. unilaterally tightened sanctions on Iran. Russia and China do not support this move.
  • A week ago Bush warned Iran that its attainment of nuclear arms would lead to World War III.
  • Russia, which has been assisting Iran in its nuclear construction program for decades, regards Western military action against Iran as unacceptable.
  • China has been arming Iran with missiles. Its relations with Iran have been improving for years.

We know that Bush and Cheney are capable of pre-emptive attack. We know that Bush will act if he believes he is right no matter what the costs are. In his distorted worldview, Iran with nuclear weapons is a scenario worth any cost to avoid.

We know that Bush, Cheney, and Rice have repeatedly warned Iran of meaningful consequences if Iran arms itself with nuclear weapons. We know that their terms in office end in 15 months. These are the critical months.

But it is by no means clear that the front-running candidates for office who may replace them hold substantially different views. Hillary Clinton has publicly called for sanctions against Iran and has called Iran a threat to Israel.

Why may an unprovoked attack on Iran lead to WWIII and why may it lead to the collapse of the U.S.?

Imagine this scenario. The U.S. encourages Israel to bomb the Natanz nuclear facility in Iran. Russia attempts to restrain an Iranian response but fails. Iran responds in any of many ways, such as launching missiles on Israel, firing on shipping in the Straits of Hormuz, mining the Straits of Hormuz, sending troops into Iraq, or allying its military with Hezbollah and attacking Israel from Lebanon.

The U.S., citing Iran’s aggressions (that will be the story), launches a full-scale attack on Iran designed to devastate the country. This attack has actually been planned by the U.S. for years. Syria is unable to maintain neutrality and quickly becomes a battleground between Iran and Israel.

The price of oil by this point has already soared to $200 a barrel. The U.S. begins to use its strategic reserve and to divert Iraqi production. Russia responds by taking steps to prevent its oil production from reaching the U.S. China responds by cutting off its support of the U.S. Treasury market. Venezuela halts oil shipments to the U.S. The first stages of WWIII are economic warfare designed to cripple the U.S. and halt its war-making capacity.

The U.S., unable to finance its deficits and fund its sovereign debt, is forced into raising interest rates drastically in order to borrow. The Fed is forced to print money. An inflationary spiral occurs. Meanwhile the high interest rates and high oil prices, not to mention the shock of a spreading conflict, drive the U.S. economy into severe decline. The U.S. attempts to raise taxes in order to fund itself, further crippling the economy. Gold soars to $1,500–$2,000 an ounce.

The U.S. attempts to bolster its military forces. The draft is reinstated. The severity of the emergency allows Bush and Cheney to assume emergency powers and begin a dictatorship. Elections are postponed.

The U.S. collapses.

Unfortunately, even if this scenario does not occur, the position of the U.S. is so precarious that any number of other scenarios equally disastrous lie in wait. This house needs urgently to be put in order or it will fall, and especially if it does not terminate its imperial adventures. The very fact that Bush and Cheney (or any major U.S. political officials) gain by starting WWIII is a terrible indictment of our entire political system.

Who can stop this? Who can prevent this? It will only take a few well-placed people to prevent this catastrophe. My guess is 5–20 people could sway public opinion against war or provide enough cover for Congressional dissenters to screw up their courage. Maybe even as few as 3 or 4 influential people could derail the Bush-Cheney train to disaster. They need to speak out at the right times and they must be heard. Previously mute or muted voices simply must speak out. They know who they are. They know that their silence will mean silent approval of a U.S. collapse.

Iran says documents show U.S. backing “terrorists”

Reuters
October 28, 2007

Iran has access to evidence of U.S. support for terrorist groups in the Middle East, a senior Iranian official was quoted as saying on Sunday.

Iran’s new chief nuclear negotiator, Saeed Jalili, made the allegation in comments to visiting Turkish Foreign Minister Ali Babacan, whose country may soon send troops to hunt down Kurdish guerrillas in northern Iraq.

Tehran says the rebels are operating in Iraq with U.S. forces present in the country and this shows Washington is refraining from tackling them.

Like Turkey, Iran also has faced cross-border attacks by Kurdish rebels and has shelled targets inside Iraq in response.

“Escalation of terrorism in the region is one of the direct results of the presence of occupiers in Iraq, particularly America,” Jalili, an ally of Iranian President Mahmoud Ahmadinejad, said according to the country’s state broadcaster.

“And there are documents and information available proving America’s support for terrorist groups in the region,” he said, without giving details. Jalili is also the new secretary of Iran’s Supreme National Security Council.

The United States often accuses Iran of backing and training militias responsible for some of the bloodshed threatening to tear Iraq apart. Tehran denies the charge and blames the violence in Iraq on the presence of U.S. forces.

The two countries are also locked in a stand-off over Tehran’s nuclear program, which Western powers suspect is aimed at developing bombs. Iran says it only wants to generate electricity.

Washington last week dubbed Iran’s Revolutionary Guard Corps a proliferator of weapons of mass destruction and accused its Qods force of backing terrorists. It also imposed sanctions on more than 20 Iranian companies, major banks and individuals.

At a joint news conference with Babacan, Iranian Foreign Minister Manouchehr Mottaki on Sunday also accused the United States and Israel of involvement in terrorism in the region.

“We see … their hand behind some of the regional terrorist activities,” Mottaki said.

Babacan, whose country’s ties with the United States have deteriorated sharply in recent weeks, thanked Iran for helping Turkey fight the PKK guerrillas and said the two sides had talked about continuing their cooperation.

The Kurdistan Workers Party (PKK) launched its campaign for a Kurdish homeland in southeastern Turkey in 1984. More than 30,000 people have been killed in the conflict since then.

Jalili on October 20 replaced Ali Larijani as Iran’s chief nuclear negotiator, a move analysts saw as signaling a toughening of Tehran’s position in the atom row.

NY Gov. Spitzer Embraces Real ID

FERNANDA SANTOS
The New York Times
October 29, 2007

Gov. Eliot Spitzer’s plan to provide three kinds of driver’s licenses, two that would meet new federal security regulations and a third that would be available to illegal immigrants, has put New York on pace to be among the first states to adopt the federal identification program known as Real ID.

Mr. Spitzer seemed to be ignoring the federal mandate several weeks ago when he announced that illegal immigrants would be allowed to get the same type of license as other state residents.

The proposal set off intense criticism — a Siena College poll of 620 registered voters found that 72 percent opposed it — even as Mr. Spitzer made clear that he would consider creating a class of driver’s licenses in the future to abide by federal regulations.

Mr. Spitzer’s new position, announced on Saturday in Washington, places New York among a handful of states agreeing to implement a federal identification system that has faced intense opposition from civil libertarians, immigration advocates and many lawmakers. Concerns focus on privacy protection and the costs to states that implement the Real ID program.

The program is supposed to be phased in nationally by 2013, but Mr. Spitzer wants to put his plan in place next year.

“The costs involved in this program are by no means insignificant,” said Jim Harper, director of information policy studies at the Cato Institute, a libertarian policy group in Washington.

The Department of Homeland Security puts the price of the program nationally at $23 billion over 10 years, while the National Governors Association estimates that the cost to states will exceed $11 billion in the first five years alone. Still, Congress appropriated just $40 million for start-up costs in 2006, leaving the burden of paying for most of the costs largely to the states.

“There’s going to be an irreducible expense that falls on you, and that’s part of the shared responsibility,” the secretary of homeland security, Michael Chertoff, said in August at a meeting of the National Conference of State Legislatures.

The Real ID law, which Congress passed two years ago, sets national standards for state-issued documents like driver’s licenses and other identification cards, requiring applicants to prove citizenship or legal residency to obtain them. One of the goals of the legislation was to make identification documents harder to forge.

Under the program, an estimated 245 million drivers will have to renew their licenses in person and present a form of photo identification and documents proving date of birth, Social Security number and address.

Proponents of the act say that it responds to recommendations of the 9/11 Commission and that its stricter and standardized rules could keep terrorists and illegal immigrants from obtaining legitimate identification.

But 17 states have passed laws defying the mandate, while others are considering similar measures.

One criticism that has been raised is that the personal information will be entered in databases that will be shared by every state, raising questions about how the data will be secured and how safe its storage will be.

“That’s an identity thief’s dream,” said Christopher Calabrese, counsel for the American Civil Liberties Union’s technology and liberty program.

Mr. Calabrese said that Mr. Spitzer’s proposal to create a driver’s license that would appeal largely to undocumented immigrants presents “a much more dangerous condition” for them.

“What we’re going to have,” he said, “is a list of undocumented aliens, and there’s no way New York will be able to keep the federal government’s hands off this list and protect the people whose names are on the list.

“Spitzer may have had the best of intentions at first,” Mr. Calabrese continued, “but he buckled to political pressure and it seems now that his good intentions have backfired.”

Mr. Spitzer’s new plan would also create an even more secure type of license, which would be particularly useful for New Yorkers who frequently cross into Canada.

CFR President: $200 Oil If War With Iran

Rogue Government
October 28, 2007

Richard Haass the President of the Council on Foreign Relations and Bilderberg luminary was recently interviewed by Katie Couric on the situation with Iran. During the interview, Haass predicted that the crisis over Iran’s nuclear program could come to a head within the next few months and that war with Iran would result in oil prices rising to $200 a barrel. Haass also made it clear that sanctions would not be effective in changing Iran’s stance on their nuclear program and that there was a real possibility of a U.S. military strike on Iran using aircraft and cruise missiles. When Couric specifically asked Haass if he thought we would see a war with Iran, he responded.

“I don’t think we are talking about invasion, the U.S. doesn’t have ground troops. There could be a military strike using aircraft and cruise missiles, but if you ask me over the next year or two years can I imagine the U.S. and Iran moving to conflict? The short answer is yes. Is it definite? Obviously not, but is it a real possibility; for sure.”

Haass also mentioned in the interview that war with Iran would result in the oil price reaching $200 a barrel. This specific prediction from Haass is interesting considering reports from previous Bilderberg meetings that the global elite have been seeking an increase in oil prices as part of an effort to further squeeze the U.S. middle class.

A $200 oil price is certainly not out of the realm of possibility considering oil recently eclipsed the $90 a barrel mark. The rising oil price has thus far been primarily due to a combination of geopolitical tensions in the Middle East along with the falling value of the U.S. Dollar. In addition, the Federal Reserve is widely expected to cut interest rates again which would send the price of oil even higher and the value of the U.S. Dollar even lower. Any military attack on Iran would certainly send oil prices much higher with the possibility of other countries with close ties to Iran like Venezuela cutting off oil sales in retaliation.

It is clear that the global elite are seriously considering military action against Iran as part of their goal to further their agenda for one world government. The major media networks have been out in full force spreading all sorts of propaganda in an effort to convince the masses that we need an invasion of Iran. The propaganda fails to mention that any invasion of Iran could have a devastating effect on the U.S. economy with the potential of skyrocketing gasoline prices. Hopefully, they’ll come to their senses and put a halt to any plans for a military strike against Iran. With countries like Pakistan and North Korea holding a nuclear arsenal, it doesn’t make any logical sense to go after a country like Iran that doesn’t even have a nuclear weapon. The only rationale for an invasion of Iran is raw imperialism, and unfortunately that’s what we are seeing unfold.

How to get the travelers file that Homeland Security has on you

Jamie Rhein
Gadling
Oct 27th 2007

Maybe your Homeland Security file is wafer thin — not much in it that would excite even your grandmother, but if you’re curious to find out what the U.S. government has been collecting on you, here’s the way to get the scoop. The Identity Project has down-loadable request forms that you fill out and mail to the address printed on the documents. You can find out some of the information, although possibly not all of it.

What you’ll eventually get back is any unclassified information like PNRs, APIS Data; and secondary search records. Huh? I don’t know quite what those mean. And, what good does it do to know that stuff? It seems the classified info is the juiciest. At least it’s a start and could help folks feel satisfied and more comfortable that they have a bit of a handle on what the government is up to when it comes to background checks.

Also, as we’ve pointed out, besides your travel habits, your gestures and behaviors, what you put up on the Internet is up for grabs when it comes to keeping track of just who and what you are. [via boingboing]

Texas Toll Opponents “Crazy,” “Dangerous”

Jim Forsyth
WOAI News Radio
October 25, 2007

Bexar County Judge Nelson W. Wolff used his State of the County address today to tear into opponents of toll roads in Bexar County, saying they are ‘crazy’ and ‘dangerous’ and suggesting once that if he ‘named the other members of Commissioner’s Court who support toll roads it might endanger their lives.’

Wolff said toll roads are ‘the right way,’ and he urged the Chamber of Commerce audience to cheer Metropolitan Planning Organization Chair Sheila McNeil, who was sued along with the MPO this week by toll road opponents who claim that the organization is illegally pushing for toll roads.

“We have some people who have had to take a lot of heat,” Wolff said. “One of them is Sheila McNeil who is the head of the MPO. Sheila, stand up. We owe you a round of applause for taking the heat from these crazy people who are jamming it down your throat every day!”

Wolff has been a long time supporter of toll roads, and he has mentioned the importance of building toll roads in his previous two State of the County speeches. But the vehemence of his denunciation of toll road opponents surprised some in his generally pro toll audience. Wolff didn’t mention by name which toll road opponents he thinks are ‘crazy’ or ‘dangerous’ but he did cite an incident following a meeting to discuss toll roads.

“We had an incident not too long ago, where the anti toll road people were here and sort of jumped (Regional Mobility Authority Chairman) Bill Thornton and I in the parking lot. I tried to get away from him and he kept following me. I finally turned around and asked him to get away from me, and he said ‘give me your best shot.’ I called the deputy across the street, and he came over and kept him away from me. Let me tell you, they are dangerous people.”

“We’re barely holding on with a three two vote on Commissioners Court supporting this project,” Wolff said. “I won’t tell you who the other two commissioners are, I don’t want to endanger their lives.”

Lyle Larson and Tommy Adkisson are toll road opponents on Bexar County Commissioner’s Court.

Then, Wolff suggested that Bexar County residents should be grateful that toll roads are being built.

“The roads on the side will be free, the toll lanes will be in the middle, you don’t have to get onto the toll lane, you should be happy we’re building it, because there will be less traffic on the free lanes.”

Wolff said he opposes any concessions agreement which would allow “a company from Spain” to build the toll roads, a reference to the Cintra-Zachry partnership which has the contract to build 40 miles of the State Highway 130 toll road.

“TexDOT wants to give it (the US 281 toll lane construction contract) to a company from Spain,” Wolff said. “We prefer that the public be involved. We need to stick with the public sector, we need to keep the tolls as low as possible, and allow that money to stay right here and not go someplace else, whether it be Spain or someplace else in Texas.”

Terri Hall, founder of Texans Uniting for Reform and Freedom, the leading anti toll group, agrees there is a lot that is crazy about toll roads, but toll road opponents aren’t among them.

“What’s crazy is charging us over and over again for what’s already paid for,” Hall said. “What’s crazy is claiming that they’re not tolling existing roads, when that’s exactly what they’re doing. And what’s dangerous is TexDOT failing to construct overpasses on 281 where deaths have occurred, so they can build ‘cash cow’ toll roads.”

Hall says she’s ‘amazed’ that a Chamber of Commerce audience cheered Wolff’s pro toll remarks, when toll roads will hurt local businesses and harm the county’s tax base.

“People are not going to go to the store, or buy that pair of shoes, when they have to pay all that money on tolls. That is going to hurt the tax base of Bexar County, and that’s the bottom line.”

Elsewhere in his State of the County speech, Wolff said he anticipates suggestions on an estimated $300 million dollar venue tax renewal proposal to be submitted to Commissioners Court by December, and a vote could be called on the issue next spring. He says officials are considering four potential uses for the venue tax money. Sports complexes, including facilities at UTSA, a Performing Arts Center, which could be built inside the existing Municipal Auditorium, expansion of the Riverwalk south and north, and improvements to the AT&T Center.

Billions over Baghdad

Donald L. Barlett and James B. Steele
Vanity Fair
October 2007

Hidden in plain sight, 10 miles west of Manhattan, amid a suburban community of middle-class homes and small businesses, stands a fortress-like building shielded by big trees and lush plantings behind an iron fence. The steel-gray structure, in East Rutherford, New Jersey, is all but invisible to the thousands of commuters who whiz by every day on Route 17. Even if they noticed it, they would scarcely guess that it is the largest repository of American currency in the world.

Officially, 100 Orchard Street is referred to by the acronym eroc, for the East Rutherford Operations Center of the Federal Reserve Bank of New York. The brains of the New York Fed may lie in Manhattan, but xeroc is the beating heart of its operations—a secretive, heavily guarded compound where the bank processes checks, makes wire transfers, and receives and ships out its most precious commodity: new and used paper money.

On Tuesday, June 22, 2004, a tractor-trailer truck turned off Route 17 onto Orchard Street, stopped at a guard station for clearance, and then entered the eroc compound. What happened next would have been the stuff of routine—procedures followed countless times. Inside an immense three-story cavern known as the currency vault, the truck’s next cargo was made ready for shipment. With storage space to rival a Wal-Mart’s, the currency vault can reportedly hold upwards of $60 billion in cash. Human beings don’t perform many functions inside the vault, and few are allowed in; a robotic system, immune to human temptation, handles everything. On that Tuesday in June the machines were especially busy. Though accustomed to receiving and shipping large quantities of cash, the vault had never before processed a single order of this magnitude: $2.4 billion in $100 bills.

Under the watchful eye of bank employees in a glass-enclosed control room, and under the even steadier gaze of a video surveillance system, pallets of shrink-wrapped bills were lifted out of currency bays by unmanned “storage and retrieval vehicles” and loaded onto conveyors that transported the 24 million bills, sorted into “bricks,” to the waiting trailer. No human being would have touched this cargo, which is how the Fed wants it: the bank aims to “minimize the handling of currency by eroc employees and create an audit trail of all currency movement from initial receipt through final disposition.”

Forty pallets of cash, weighing 30 tons, were loaded that day. The tractor-trailer turned back onto Route 17 and after three miles merged onto a southbound lane of the New Jersey Turnpike, looking like any other big rig on a busy highway. Hours later the truck arrived at Andrews Air Force Base, near Washington, D.C. There the seals on the truck were broken, and the cash was off-loaded and counted by Treasury Department personnel. The money was transferred to a C-130 transport plane. The next day, it arrived in Baghdad.

That transfer of cash to Iraq was the largest one-day shipment of currency in the history of the New York Fed. It was not, however, the first such shipment of cash to Iraq. Beginning soon after the invasion and continuing for more than a year, $12 billion in U.S. currency was airlifted to Baghdad, ostensibly as a stopgap measure to help run the Iraqi government and pay for basic services until a new Iraqi currency could be put into people’s hands. In effect, the entire nation of Iraq needed walking-around money, and Washington mobilized to provide it.

What Washington did not do was mobilize to keep track of it. By all accounts, the New York Fed and the Treasury Department exercised strict surveillance and control over all of this money while it was on American soil. But after the money was delivered to Iraq, oversight and control evaporated. Of the $12 billion in U.S. banknotes delivered to Iraq in 2003 and 2004, at least $9 billion cannot be accounted for. A portion of that money may have been spent wisely and honestly; much of it probably wasn’t. Some of it was stolen.

Once the money arrived in Iraq it entered a free-for-all environment where virtually anyone with fingers could take some of it. Moreover, the company that was hired to keep tabs on the outflow of money existed mainly on paper. Based in a private home in San Diego, it was a shell corporation with no certified public accountants. Its address of record is a post-office box in the Bahamas, where it is legally incorporated. That post-office box has been associated with shadowy offshore activities.
Coalition of the Billing

The first shipment of cash to Iraq took place on April 11, 2003—it consisted of $20 million in $1, $5, and $10 bills. It was arranged in small bills on the theory that these could quickly be circulated into the Iraqi economy “to prevent a monetary and financial collapse,” as one former Treasury official put it. Those were the days when American officials worried that the gravest threat facing Iraq might be low-grade civilian unrest in Baghdad. They didn’t have a clue as to the power of the insurgency that was to come. The initial $20 million came exclusively from Iraqi assets that had been frozen in U.S. banks as long ago as the Gulf War, in 1990. Subsequent airlifts of cash also included billions from Iraqi oil revenues controlled by the United Nations. After the creation of the Development Fund for Iraq (D.F.I.)—a kind of holding pit of money to be spent for “purposes benefitting the people of Iraq”—the U.N. turned over control of Iraq’s oil billions to the United States.

When the U.S. military delivered the cash to Baghdad, the money passed into the hands of an entirely new set of players—the staff of the American-led Coalition Provisional Authority. To many Americans, the initials C.P.A. would soon be as familiar as those of long-established government agencies such as D.O.D. or hud. But the C.P.A. was anything but a conventional agency. And, as events would show, its initials would have nothing in common with “certified public accountant.” The C.P.A. had been hastily created to serve as the interim government of Iraq, but its legality and paternity were murky from the start. The Authority was in effect established by edict outside the traditional framework of American government. Not subject to the usual restrictions and oversight of most agencies, the C.P.A. during the 14 months of its existence would become a sump for American and Iraqi money as it disappeared into the hands of Iraqi ministries and American contractors. The Coalition of the Willing, as one commentator observed, had turned into the Coalition of the Billing.

The first mention of the C.P.A. came on April 16, 2003, in a so-called freedom message to the Iraqi people by General Tommy R. Franks, commander of the coalition forces. A week after mobs ransacked Iraq’s National Museum of its treasures, unchallenged by American troops, General Franks arrived in Baghdad for a six-hour whirlwind tour. He met with his commanders in one of Saddam Hussein’s palaces, held a video conference with President Bush, and then quickly flew off. “Our stay in Iraq will be temporary,” General Franks wrote, “no longer than it takes to eliminate the threat posed by Saddam Hussein’s weapons of mass destruction, and to establish stability and help Iraqis form a functioning government that respects the rule of law.” With that in mind, General Franks wrote that he created the Coalition Provisional Authority “to exercise powers of government temporarily, and as necessary, especially to provide security, to allow the delivery of humanitarian aid and to eliminate weapons of mass destruction.” Three weeks later, on May 8, 2003, the U.S. and British ambassadors to the United Nations sent a letter to the U.N. Security Council, effectively delivering the C.P.A. to the United Nations as a fait accompli.

The day before, President Bush had appointed L. Paul Bremer III, a retired diplomat, as presidential envoy to Iraq and the president’s “personal representative,” with the understanding that he would become the C.P.A. administrator. Bremer had held State Department posts in Afghanistan, Norway, and the Netherlands; had served as an assistant to Henry Kissinger and Alexander Haig; and had closed out his diplomatic career in 1989 as ambassador-at-large for counterterrorism. More recently, he had been the chairman and chief executive officer of a crisis-management business called Marsh Crisis Consulting. Despite his State Department background, Bremer had been selected by the Pentagon, which had elbowed aside all contenders for authority in post-invasion Iraq. The C.P.A. itself was a creature of the Pentagon, and it would be Pentagon personnel who did the C.P.A.’s hiring.

Over the next year, a compliant Congress gave $1.6 billion to Bremer to administer the C.P.A. This was over and above the $12 billion in cash that the C.P.A. had been given to disburse from Iraqi oil revenues and unfrozen Iraqi funds. Few in Congress actually had any idea about the true nature of the C.P.A. as an institution. Lawmakers had never discussed the establishment of the C.P.A., much less authorized it—odd, given that the agency would be receiving taxpayer dollars. Confused members of Congress believed that the C.P.A. was a U.S. government agency, which it was not, or that at the very least it had been authorized by the United Nations, which it had not. One congressional funding measure makes reference to the C.P.A. as “an entity of the United States Government”—highly inaccurate. The same congressional measure states that the C.P.A. was “established pursuant to United Nations Security Council resolutions”—just as inaccurate. The bizarre truth, as a U.S. District Court judge would point out in an opinion, is that “no formal document … plainly establishes the C.P.A. or provides for its formation.”

Accountable really to no one, its finances “off the books” for U.S. government purposes, the C.P.A. provided an unprecedented opportunity for fraud, waste, and corruption involving American government officials, American contractors, renegade Iraqis, and many others. In its short life more than $23 billion would pass through its hands. And that didn’t include potentially billions more in oil shipments the C.P.A. neglected to meter. At stake was an ocean of cash that would evaporate whenever the C.P.A. did. All parties understood that there was a sell-by date, and that it was everyone for himself. An Iraqi hospital administrator told The Guardian of England that, when he arrived to sign a contract, the army officer representing the C.P.A. had crossed out the original price and doubled it. “The American officer explained that the increase (more than $1 million) was his retirement package.” Alan Grayson, a Washington, D.C., lawyer for whistle-blowers who have worked for American contractors in Iraq, says simply that during that first year under the C.P.A. the country was turned into “a free-fraud zone.”

Bremer has expressed general satisfaction with the C.P.A.’s work while at the same time acknowledging that mistakes were made. “I believe the C.P.A. discharged its responsibilities to manage these Iraqi funds on behalf of the Iraqi people,” he told a congressional committee. “With the benefit of hindsight, I would have made some decisions differently. But on the whole, I think we made great progress under some of the most difficult conditions imaginable, including putting Iraq on the path to democracy.”
The Bottomless Vault

To be fair, the C.P.A. really did need money desperately, and it really did need to start spreading it among the traumatized Iraqi population. It also needed to jump-start Iraq’s basic services. As the C.P.A. demanded ever greater amounts of cash, the pallets of $1, $5, and $10 bills were soon replaced by bundles of $100 bills. During the C.P.A.’s little more than a year of life, the New York Federal Reserve Bank made 21 shipments of currency to Iraq totaling $11,981,531,000. All told, the Fed would ship 281 million individual banknotes, in bricks weighing a total of 363 tons.

After arriving in Baghdad, some of the cash was shipped to outlying regions, but most of it stayed in the capital, where it was delivered to Iraqi banks, to installations such as Camp Victory, the mammoth U.S. Army facility adjacent to the Baghdad airport, and to Saddam’s former presidential palace, in the Green Zone, which had become the home of Bremer’s C.P.A. and the makeshift Iraqi government. At the palace the cash disappeared into a vault in the basement. Few people ever saw the vault, but the word was that during one short period it held as much as $3 billion. Whatever the figure, it was a major repository of the banknotes from America during the brief time the cash was under the care of the C.P.A. The money flowed in and out rapidly. When someone needed cash, a unit called the Program Review Board, composed of senior C.P.A. officials, reviewed the request and decided whether to recommend a disbursement. A military officer would then present that authorization to personnel at the vault.

Even those who picked up large sums usually did not actually see the vault. Once a disbursement had been made, the cash was brought to an adjoining room for pickup. This “secure room,” as one military officer called it, looked a lot like a vault itself: a thick metal door at the entrance, with the room beyond starkly furnished with only a table and chairs. The table would be piled high with cash. An authorized officer would sign papers for the money, then begin carting it upstairs—sometimes in sacks or metal boxes—to the Iraqi ministry or C.P.A. office that had requested it. Upon turning over the cash, the officer would be required to obtain a receipt—nothing more.

C.P.A. officials tried to keep a rough running tab on the amount disbursed to individual Iraqi agencies such as the Ministry of Finance ($7.7 billion). But there was little detail, nothing specific, on how the money was actually used. The system basically operated on “trust and faith,” as one former C.P.A. official put it. Once the cash passed into the hands of the Iraqis or any other party, no one knew where it went. The C.P.A. turned over $1.5 billion in cash to Iraqi banks, for instance, but later auditors could account for less than $500 million. The United Nations retained a team of auditors to look over American shoulders. They didn’t see much, because they were largely cut off from access while the C.P.A. held power. As a report by the U.N.’s accounting consultant, KPMG, noted dryly, “We encountered difficulties in performing our duties and meeting with key C.P.A. personnel.”

“There was corruption everywhere,” said one former military officer who worked with the C.P.A. in Baghdad in the months after the invasion. Some of the Iraqis who were put in charge of ministries after Saddam’s fall had never run a government agency before. Their inexperience aside, he said, they lived in constant fear of losing their jobs or their lives. All many cared about, he added, was taking care of themselves. “You could see that a lot of them were trying their best to get a quick retirement fund before they were ousted or killed,” he added. “You just get what you can while you’re in that position of power. Instead of trying to build the nation, you build yourself.”

Did any withdrawals from the vault pay for secret activities by government personnel? It is an obvious possibility. Much of the cash was clearly destined for American contractors or Iraqi subcontractors. Sometimes the Iraqis came to the palace to collect their cash; other times, when they were reluctant to show up at the American compound, U.S. military personnel had to deliver it themselves. One of the riskier jobs for some U.S. military men was to fill up a car with bags of cash and drive the money to contractors in Baghdad neighborhoods, handing it over like a postal worker delivering mail.

‘Fraud” was simply another word for “business as usual.” Of 8,206 “guards” drawing paychecks courtesy of the C.P.A., only 602 warm bodies could in fact be found; the other 7,604 were ghost employees. Halliburton, the government contractor once headed by Vice President Dick Cheney, charged the C.P.A. for 42,000 daily meals for soldiers while in fact serving only 14,000 of them. Cash was handed out from the backs of pickup trucks. On one occasion a C.P.A. official received $6.75 million in cash with the expectation he would shell it out in one week. Another time, the C.P.A. decided to spend $500 million on “security.” No specifics, just a half-billion dollars for security, with this cryptic explanation: “Composition TBD”—that is, “to be determined.”

The pervasiveness of this Why-should-I-care? attitude was driven home in an exchange with retired admiral David Oliver, the C.P.A.’s director of management and budget. Oliver was asked by a BBC reporter what had happened to all the cash airlifted to Baghdad:

Oliver: “I have no idea—I can’t tell you whether or not the money went to the right things or didn’t—nor do I actually think it’s important.”

Q: “Not important?”

Oliver: “No. The coalition—and I think it was between 300 and 600 people, civilians—and you want to bring in 3,000 auditors to make sure money’s being spent?”

Q: “Yes, but the fact is that billions of dollars have disappeared without a trace.”

Oliver: “Of their money. Billions of dollars of their money, yeah, I understand. I’m saying what difference does it make?”

The difference it made was that some American contractors correctly believed they could walk off with as much money as they could carry. The circumstances that surround the handling of comparatively small sums help explain the billions that ultimately vanished. In the south-central region of Iraq a contracting officer stored $2 million in a safe in his bathroom. One agent kept $678,000 in an unsecured footlocker. Another agent turned over some $23 million to his team of “paying agents” to deliver to contractors, but documentation could be found for only $6.3 million of it. One project officer received $350,000 to fund human-rights projects, but in the end could account for less than $200,000 of it. Two C.P.A. agents left Iraq without accounting for two payments of $715,000 and $777,000. The money has never been found.

To Frank Willis, a senior adviser to the Iraqi transportation ministry, the presence of so much cash circulating so freely gave the Green Zone a “Wild West” feel. A moderate Republican who worked for Reagan and voted for George W. Bush, Willis spent many years in executive roles in the State Department and the Department of Transportation before leaving government service in 1985. He was a top executive of a health institute in Oklahoma when, in 2003, an old friend from Washington called and asked if he would come to Iraq to help the C.P.A. get the various transportation systems running again.

“You’ve got to be crazy,” Willis told him at first. He says he was talked into going for 30 days, but once in Baghdad became caught up in the work and stayed for six grueling months. Willis says he wasn’t there a month before he felt the way things were being done was “terribly wrong.” One afternoon he returned to his office to find piles and piles of shrink-wrapped $100 bills stacked on a table. “This just got wheelbarrowed in,” one of his American colleagues explained. “What do you think of two million bucks?” The money had been “checked out” of Saddam’s old vault in the basement, two floors below, in order to pay a U.S. contractor hired by the C.P.A. to provide security.

The neat bundles of cash looked almost like play money, and the temptation to handle them was irresistible. “We were all in the room passing those things around and having fun,” Willis remembers. He and his colleagues played a game of football, tossing the bricks back and forth. “You could spin them but not throw a spiral,” Willis says with a laugh. When he called the American contractor to come get his money, Willis advised him, “You better bring a gunnysack.”
“Integrity Is a Core Principle”

The American contractor needing the gunnysack was a company called Custer Battles. The name was derived not from Little Big Horn but from the names of the company’s owners, Scott K. Custer and Michael J. Battles. Both were former army rangers in their mid-30s, and Battles also had once been a C.I.A. operative. The pair showed up on the streets of Baghdad with the blessing of the White House at invasion’s end, looking for a way to do business. At the time, the only American civilians who could gain access to the city were those approved by President Bush’s staff.

The Battles half of the team brought the White House access, secured when Michael Battles became the G.O.P.-backed candidate in the 2002 Rhode Island congressional primary for the privilege of losing to the Democratic incumbent, Patrick Kennedy. Battles not only lost the primary but was fined by the Federal Election Commission for misrepresenting campaign contributions. Nevertheless, he forged important political connections. His contributors included Haley Barbour, the longtime Washington power broker and former chairman of the Republican National Committee, who is now governor of Mississippi, and Frederic V. Malek, a former special assistant to President Nixon, who survived the Watergate scandal and went on to become an insider in the Reagan administration and both Bush administrations.

The C.P.A. awarded Custer and Battles one of its first no-bid contracts—$16.5 million to protect civilian aircraft flights, of which at the time there were few, into Baghdad International Airport. The company faced immediate obstacles: Custer and Battles didn’t have any money, they didn’t have a viable business, and they didn’t have any employees. Bremer’s C.P.A. had overlooked these shortcomings and forked over $2 million anyway, in cash, to get them started, simply ignoring long-standing requirements that the government certify that a contractor has the capacity to fulfill a contract. That first $2 million cash infusion was followed shortly by a second. Over the next year Custer Battles would secure more than $100 million in Iraq contracts. The company even set up an internal Office of Corporate Integrity. “Integrity is a core principle of Custer Battles’ corporate values,” Scott Custer stated in a press release.

The U.S. business community was impressed by this upstart. In May 2004, Ernst & Young, the global accounting firm, announced the finalists for its New England Entrepreneur of the Year Awards, honoring an ability “to innovate, develop, and cultivate groundbreaking business models, products, and services.” Among the honorees were Scott Custer and Michael Battles.

Four months later, in September 2004, the air force issued an order barring Custer Battles from receiving any new government contracts until 2009. The company had come to epitomize the way business was done in Baghdad. Custer Battles had billed the government $400,000 for electricity that cost $74,000. It had billed $432,000 for a food order that cost $33,000. It had charged the C.P.A. for leased equipment that was stolen, and had submitted forged invoices for reimbursement—all the while moving millions of dollars into offshore bank accounts. In one instance, the company claimed ownership of forklifts used to transport the C.P.A.’s cash (among other things) around the Baghdad airport. But up until the war the forklifts had been the property of Iraqi Airways. They were “liberated,” along with the Iraqi people, following hostilities. Custer Battles seized them, painted over the old name, and transferred ownership to its offshore businesses. The forklifts were then leased back to Custer Battles for thousands of dollars a month, a cost that Custer Battles passed along to the C.P.A. In 2006, a federal-court jury in Virginia ordered the company to pay $10 million in damages and penalties for defrauding the government. The jury found more than three dozen instances of fraud in which Custer Battles used shell companies in the Cayman Islands and elsewhere to manufacture phony invoices and pad its bills. During the same period Battles personally withdrew $3 million from the company coffers as a kind of bonus—or, as he put it, “a draw.” The jury decision in the whistle-blower lawsuit was subsequently overturned when the trial judge set the verdict aside, pointing out that the C.P.A. was not in fact a U.S.-government entity and hence Custer Battles could not be tried under the federal fraud act. That decision is under appeal.
The NorthStar Contract

How can billions of dollars simply vanish? Wasn’t there any accounting mechanism in place to keep track of the money?

La Jolla, California, is about as far away from Iraq in both distance and mind-set as one can get. The house at 5468 Soledad Road is a two-story dwelling with six bedrooms and five and a half baths, a typical California home of beige stucco under a red tiled roof. The neighborhood is lush and well kept. But in one respect 5468 Soledad is not a typical suburban house at all.

On October 25, 2003, the C.P.A. awarded a $1.4 million contract “to provide accountant and audit services” to help “in the management and accounting of the Development Fund for Iraq.” In other words, the purpose was to help Bremer and the C.P.A. keep tabs on the billions of dollars under their control, and to help make sure that the money was properly spent. The one-year C.P.A. contract was awarded to a company called NorthStar Consultants.

When a request was made to the U.S. government for a copy of this contract, officials at the Pentagon, which has oversight, dragged their feet for weeks. The document they eventually supplied had been strategically redacted. Nearly all the information about the contractor had been blacked out, including the name and title of the company officer who had executed the contract, the name of the person to call for information about the company, the last four digits of the company’s phone number, and the name of the U.S.-government official who had awarded the contract in the first place. But by cross-referencing public records and other sources it was possible to fill in some of the missing data. One path led to 5468 Soledad Road.

The house is owned by Thomas A. and Konsuelo Howell, according to San Diego County records. The couple apparently bought it new in 1999. State records indicate that several companies operate from the house. One of them is called International Financial Consulting, Inc., though it isn’t clear what this company actually does. Incorporated in 1998, I.F.C. was described as a venture in “business consulting,” according to papers Howell filed with the state. The Howells are listed as the only directors.

Another company operating out of 5468 Soledad is called Kota Industries, Inc., whose stated business is the “sale of furniture, home furnishings, flooring,” according to California records. Numerous business directories in the San Diego area ascribe similar activities to Kota, listing it as a remodeling, repairing, or restoration contractor. One directory describes its specialty as “kitchen, bathroom, basement remodeling.” Again, the Howells are the only officers and directors.

In January 2004, in the business-names index of San Diego County, Thomas Howell indicated that a third company was now based at 5468 Soledad, noting that it was owned by International Financial Consulting. This new company was NorthStar.

How did someone whose line of work includes home remodeling end up getting the contract to audit the billions being airlifted to Iraq? Thomas Howell is 60; he and his wife have lived in San Diego for at least two decades. Over the years, the couple has also maintained addresses in Fort Lauderdale, Florida, and Laredo, Texas. Neighbors describe the Howells as pleasant, but can add little else. “I know them, but I don’t know what they do,” said one. “That’s all I can tell you.” Two others could say only that they saw the Howells occasionally in the neighborhood. Were they aware that a company with an Iraqi contract had operated from the house? “Really?” said one. “No. I didn’t know that.”

Thomas Howell refuses to discuss the NorthStar contract in detail. A telephone exchange with him, reached at 5468 Soledad Road, went as follows.

A woman answered, “Kota Industries.”

“Could I speak with Mr. Thomas Howell?”

“May I ask who is calling?” the woman asked.

“My name is Jim Steele.”

“Wait just a second,” the woman said.

A few moments later, a man came on the line. “Tom Howell,” he said.

“My name is Jim Steele, and I am a writer with the magazine Vanity Fair. I would like to talk to you about NorthStar Consultants.”

Howell said, “Well, let me find a contact who can talk all this stuff with you. What is your phone number, Jim?”

Howell repeated the number and added, “O.K. Let me get somebody who can discuss all this stuff for you.”

“I’d just like to make sure here. Aren’t you president of the company?”

“That’s right,” said Howell.

“But you can’t … ”

“Well, I’m not … I can’t … You want to talk about the D.F.I. [Development Fund for Iraq] and that sort of stuff?” asked Howell.

“Well, yeah.”

“O.K.,” Howell replied, “I’ll get someone who’s authorized to talk about all that. I’ll have them give you a call or I’ll call you and give you their number.”

“Is this the military or your lawyer?”

“The military,” said Howell, abruptly ending the conversation with “O.K. Thanks. Good-bye.”

The next attempt was a visit to Howell’s home the following day. A stylishly dressed woman emerged from behind a locked fence. “May I help you?” she asked. The woman confirmed that she was Konsuelo Howell, and explained that it would be impossible to speak with her husband. “He is out of the country.”

He never did call back with the name of a Pentagon official “authorized” to speak about NorthStar. Nor did anyone from the Pentagon call. When a Pentagon public-affairs officer was queried about who might be able to discuss the contract, the officer said she needed a name, which, as it turned out, only Howell could provide. The Pentagon also failed to respond to a request for the information deleted from the NorthStar contract and the name of the person who had ordered it deleted.

When Howell was contacted again, three months later, he stated that the Department of Defense had told him that “they didn’t have anybody anymore specifically tasked with answering these questions.” As far as D.O.D. was concerned, Howell added, the issue was “closed.” Once again he refused to discuss the NorthStar contract in any detail: “The way I normally work with all my clients is: my work is confidential,” he said. “If they want to let it out, that’s fine. But I work for them. It’s their business.” Howell did say that NorthStar was his one and only U.S. government contract. How did he land it? “I saw it published on the Web, that it was out for bids,” he said.

As for how much auditing NorthStar really did in Iraq, the missing billions provide the best answer. The company did have personnel in Baghdad, though how many, and for how long, and for what purpose, is not known—another point Howell declines to discuss. Under the terms of C.P.A. Regulation No. 2, signed by Bremer on June 15, 2003, money coming into Iraq was supposed to be tracked by an “independent certified public accounting firm.” Howell was not a certified public accountant, nor were any of the people who worked for him. Bremer seems to have been unaware of this detail. When he was asked at a congressional hearing earlier this year about NorthStar, he answered, “I don’t know what kind of firm it was, other than it was an accounting firm.” Would it upset him, a congressman asked, if he found out there were no accountants on NorthStar’s staff? “It would,” Bremer answered, “if it were true.”

It is true. And rather than reissue the contract to a certified public accountant, someone in the government contract office simply eliminated the requirement, thereby making Howell eligible for the work.
The Baghdad-Bahamas Connection

When an unknown official at the Pentagon meticulously went through the NorthStar contract and used a thick-tipped marker to black out Thomas Howell’s name, title, office address, and phone number, he or she neglected to conceal one of the most intriguing aspects of the contract: NorthStar’s mailing address. It was P.O. Box N-3813 in Nassau, in the Bahamas.

High on a hill in Nassau, the main post office commands panoramic views of the capital city—the pink stuccoed Parliament building, bustling Bay Street with its hordes of tourists, and, beyond it, the giant cruise ships that dock in Nassau’s harbor. Just as you enter the post office, on a sprawling plaza beneath an overhang offering protection from the tropical sun and rain, there stand row after row of metal boxes, each bearing the capital letter N followed by a series of numbers. These are the private post-office boxes of Nassau. Because there is no home delivery in the city, it is the way people in the capital get their mail.

Box N-3813, four inches wide by five inches high, looks like all the other post-office boxes. It harbors many secrets that its users want to keep. No one knows whether anyone at the C.P.A. or the Pentagon questioned why one of its contractors used an offshore post-office box. It is undeniably true, however, that foreigners often use post-office boxes in the Bahamas and other tax havens for three purposes: to conceal assets, to avoid taxes, and to launder money. NorthStar would not be at all unusual among Iraq contractors in setting up its affairs this way. Post-office boxes in tax havens around the world have been flooded with contractor business based in Iraq.

Box N-3813, it turns out, has been the locus for all sorts of transactions by Americans and others looking to move money offshore. In addition to Howell’s NorthStar, this particular box also served as the address of record for a man named Patrick Thomson and for his Bahamian business called Lions Gate Management. Both figured prominently in one of the more spectacular offshore frauds in recent years, the collapse of Evergreen Security. The Caribbean-based Evergreen enticed thousands of investors, many of them U.S. retirees, to pour money into its so-called tax-sheltered offshore funds, with the promise of handsome returns. Some of the money came from hundreds of Caribbean trusts for which Thomson acted as trustee. A Ponzi scheme masquerading as a mutual fund, Evergreen siphoned $200 million from investors in the United States and two dozen other countries. One of its ringleaders was William J. Zylka, a New Jersey “con artist who falsified his background, credentials and wealth in order to perpetrate elaborate schemes,” according to court documents. He pocketed $27.7 million of Evergreen’s money.

Throughout the looting of Evergreen, Thomson was one of the firm’s three directors. During that time he also arranged for Howell to establish the same Nassau post-office box as NorthStar’s legal home. Identified in Nassau as a member of one of Scotland’s oldest publishing families, Thomson has operated out of one or more office buildings in the heart of Nassau for many years. Like most of those in the shadowy world of offshore deals, he has generally kept a low profile, the scandal over Evergreen Security being the one great exception. Thomson incorporated NorthStar for Howell in the Bahamas in January of 1998, as what is known as an “international business company,” or I.B.C. Despite their impressive name, I.B.C.’s are little more than paper operations. As a rule, they don’t carry on any business; they are empty vessels that can be used for anything. They have no real chief executive officer or board of directors, and they don’t publish financial statements. An I.B.C.’s books, if there are any, can be kept anywhere in the world, but no one can inspect them. I.B.C.’s aren’t required to file annual reports or disclose the identity of their owners. They’re shells, operating in total secrecy. In the last two decades, they have sprouted by the hundreds of thousands in tax havens worldwide.

In a telephone interview, Thomson discussed with great reluctance his role in creating NorthStar for Thomas Howell. How did they meet?

“I believe I was introduced to him through a friend with Citibank,” Thomson replied. “I believe Howell used to work for Citibank.” He said it was his recollection that Howell initially established NorthStar because of some consulting work he was doing in the Far East, not the Middle East. “This was before the Iraq war started,” he noted. “All we did was supply a company name.” Thomson said he had had no contact with Howell in years. He had heard that Howell was in Iraq, but declined to discuss the matter further.
Turning Off the Spigot

By the spring of 2004 the clock was winding down for L. Paul Bremer and the C.P.A. Within several months—on June 30—the Authority was scheduled to turn government operations over to the Iraqis, at least formally. There was palpable anxiety among officials and contractors about what would happen under the new Iraqi regime, and they launched an aggressive effort to get as much money into the pipeline as possible. On April 26, another shipment of cash-laden pallets, this one holding $750 million, arrived at Baghdad International Airport. On May 18 the Fed made a $1 billion shipment, which was followed on June 22 by the biggest single shipment ever made by the Fed anywhere—$2.4 billion. Another $1.6 billion arrived three days later, bringing the total of cash shipments to Iraq to $5 billion in the C.P.A.’s final three months.

The C.P.A. sought to make one more huge withdrawal. On Monday, June 28, as Bremer stole away from Baghdad unannounced—two days ahead of the scheduled handover of authority—another C.P.A. official put in hurried pleas to the Federal Reserve Bank for an additional $1 billion infusion, hoping to get the money before an Iraqi provisional government came to power. Internal e-mails from the Federal Reserve Bank show that the requests for money came from Don Davis, an air-force colonel serving as the C.P.A. comptroller and manager of the Development Fund for Iraq. But the Fed would have no part of the plan. Because Bremer had already “transferred authority (which is being reported in the press as 10:26 a.m. in Baghdad),” a Fed official explained, “the C.P.A. no longer had control over Iraq’s assets.”

In one of his last official acts before leaving Baghdad, Bremer issued an order—prepared by the Pentagon, he says—declaring that all coalition-force members “shall be immune from any form of arrest or detention other than by persons acting on behalf of their Sending States.” Contractors also got the same get-out-of-jail-free card. According to Bremer’s order, “contractors shall be immune from Iraqi legal process with respect to acts performed by them pursuant to the terms and conditions of a Contract or any sub-contract thereto.” The Iraqi people, who had had no say over Saddam Hussein’s illegal conduct during his dictatorship, would have no say over illegal conduct by Americans in their new democracy.

And the “Sending State” itself is not interested in pursuing misconduct. With the exception of a few low-level individuals, the Bush administration’s Justice Department has resolutely avoided the prosecution of corporate fraud stemming from the occupation of Iraq.

“In our fifth year in the war in Iraq,” according to Alan Grayson, the attorney for whistle-blowers, “the Bush administration has not litigated a single case against any war profiteer under the False Claims Act.” This at a time, Grayson told a congressional committee, when “billions of dollars are missing and many billions more wasted.” Grayson knows what he is talking about. He represented the whistle-blowers in the Custer Battles case brought under the False Claims Act—a case in which the Justice Department refused to get involved, and the only one that has gone to trial.

There is no true method of calculating the human cost of the war in Iraq. The monetary cost, grossly inflated by theft and corruption, is another matter. One simple piece of data puts this into perspective: to date, America has spent twice as much in inflation-adjusted dollars to rebuild Iraq as it did to rebuild Japan—an industrialized country three times Iraq’s size, two of whose cities had been incinerated by atomic bombs. Understanding how and why this happened will take many years—if understanding comes at all. There has been no rush to explain even this one small part of the story, that of the missing Iraqi billions. No one in the U.S. government wants to talk about NorthStar Consultants, much less about the money that disappeared. Bradford R. Higgins was the C.P.A.’s chief financial officer, on loan from the State Department, where he is assistant secretary for resource management and chief financial officer. Higgins says it was “a Department of Defense–managed operation”; he says that “I don’t know anyone at NorthStar” and that he did not oversee its operations. The C.P.A.’s comptroller and D.F.I. fund manager during the NorthStar days in 2003 was air-force colonel Don Davis. Through the air-force public-affairs office in the Pentagon, Davis declined to comment. L. Paul Bremer III, who wrote a 400-page book on his experiences as the C.P.A.’s administrator, stated in an interview that he had no input in the decision to hire NorthStar. He explained that “all of the contracting was done, by order of the secretary of defense, by the department of the army. They were our contracting arm … I don’t think I ever heard of NorthStar until some questions came up after I left.” Nor did he have any dealings with NorthStar’s Howell, he said. “If I met him, I have no memory of it.” Queries sent repeatedly to the army’s public-affairs desk in Baghdad and the Pentagon have gone unanswered, as have those to the office of the secretary of defense.

The simple truth about the missing money is the same one that applies to so much else about the American occupation of Iraq. The U.S. government never did care about accounting for those Iraqi billions and it doesn’t care now. It cares only about ensuring that an accounting does not occur.