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Murray Waas reports on the website of the Atlantic that Alberto Gonzales is now telling investigators that he was being personally directed by President Bush when, as White House counsel, Gonzales made a much-discussed late-night visit in 2004 to the hospital room of then Attorney General John Ashcroft, in order to get Ashcroft to certify that the Bush administration's warrantless wiretapping program was legal.

During Congressional testimony last year, Gonzales repeatedly refused to answer persistent questioning from Sen. Chuck Schumer as to whether the president, or Vice President Cheney, had directed him to seek out Ashcroft in the hospital.



Cheney himself told CNN's Larry King shortly afterward: "I don't recall that I gave instructions to that effect."

It's an important question, because its answer would shed light on the extraordinary lengths to which the president was willing to go to see the wiretap program reauthorized. At the time of the hospital-room meeting, Ashcroft, in Waas's words, "had been in intensive care for six days, was heavily medicated, and was recovering from emergency surgery to remove his gall bladder."

Waas adds:

Deputy Attorney General James B. Comey has said that he believes that Gonzales and White House Chief of Staff Andrew Card, who accompanied Gonzales to Ashcroft's hospital room, were trying to take advantage of Ashcroft's grievously ill state--pressing him to sign the certification possibly without even comprehending what he was doing--and in the process authorize a government surveillance program which both Ashcroft and the Justice Department had concluded was of questionable legality.
Gonzales' claim has come to light as part of an investigation being conducted by the Inspector General for the Department of Justice into whether Gonzales lied to Congress. In a separate story posted today, Waas reports that DOJ investigators are also looking into whether Gonzales created a set of fictitious notes to provide a rationale for the president's reauthorization of the program.

Gonzales had claimed during his testimony that at a 2004 meeting just prior to the Ashcroft hospital visit, Congressional leaders had given their support to the program. Four of those leaders have since denied that. President Bush had cited Gonzales' notes of the Congressional meeting as a rationale for reauthorizing the program. But the notes weren't written until days after the meeting, and after Bush and Gonzales had officially reauthorized the program. Gonzales has told the investigators that Bush personally directed him to write the notes, though it is unclear when. Investigators believe that, depending on when they were written, the notes could be evidence of an effort to provide a post-hoc justification for the reauthorization of the program.

Update: Evidence of Bush's involvement in Gonzales visit to Ashcroft's hospital room was previously reported by Barton Gellman, who wrote in his recent book, Angler: The Cheney Vice Presidency: "The phone rang at Ashcroft's bedside. Bush told his ailing cabinet chief that Alberto Gonzales and Andy Card were on their way." It had not been known, however, that Gonzales has told DOJ investigators of Bush's involvement.

It looks there's another John McCain adviser with a personal background that doesn't exactly jibe with the candidate's recent effort to portray himself as a populist crusader for ordinary folks.

Last week in Green Bay, McCain declared: "At the center of the problem were the lobbyists, politicians, and bureaucrats who succeeded in persuading Congress and the administration to ignore the festering problems at Fannie Mae and Freddie Mac."

Of course, as Barack Obama has pointed out, McCain's campaign is a virtual who's who of former lobbyists for Fannie and Freddie.

But another McCain adviser has close personal ties to one of the industries that, like Fannie and Freddie, spent too long assuring the public that the housing market was in good health, and thereby forestalling efforts that might have protected homeowners and staved off a crisis.

Nancy Pfotenhauer, a senior economic adviser to McCain, has been all over the airwaves in recent days touting McCain's decision to "suspend" his campaign over the bailout. But her husband, Kurt Pfotenhauer, worked until late last year as the top lobbyist for the Mortgage Bankers Association, a trade group that in recent years downplayed fears of a housing bubble, only to be proved spectacularly wrong.

When MBA released a report in 2005 on the state of the housing market, its chief economist told reporters: "There are risks but they're far less dramatic than the hyperbole of recent months." An MBA vice president added: "We're trying to dismiss the overheated rhetoric on bubbles." Part of the purpose of the ho-hum rhetoric, it would appear, was to discourage government regulators from looking more closely at the problems in the market, and ultimately taking action to protect homeowners. And many experts blame that regulatory inaction in the housing market for the current financial crisis now shaking the country.

Since January, Kurt Pfotenhauer, who did not immeduately respond to a detailed request for comment, has served as the CEO of the American Land Title Association, a trade association representing the title insurance industry. But during the current crisis, his old employer, MBA, has been at the center of lobbying efforts -- successful it appears -- to oppose a provision, sought by Democrats, that would allow bankruptcy judges to modify mortgages on primary residents. The lending industry has long fought such measures, arguing that it would force lenders to increase mortgage rates. In a statement issued yesterday, the MBA asserted that the provision "would throw into question the value of the collateral that backs every mortgage made in this country -- the home." According to one Democratic lobbyist, MBA's current top lobbyist, Francis Creighton, has lately been "living in the halls" of Congress in an effort to influence lawmakers on the bill.

Allies of Kurt Pfotenhauer have lately been willing to tout his ties to the McCain campaign, through his wife, to bolster his professional credentials. An advanced notice of a speech Kurt was to give last week to the Indiana Land Title Association (ITLA), an ALTA affiliate, published in an Indiana newspaper and seemingly written by the ITLA, noted that he would "provide a public policy update from the nation's capital, with an emphasis on the housing and mortgage finance crisis." It added: "His wife, Nancy, is a senior advisor and national spokesperson for presidential candidate John McCain."

Of course, there's no reason why Nancy Pfotenhauer's career should be limited by her husband's lobbying work. But at the very least, Kurt Pfotenhauer's recent role as an advocate for banking interests that discouraged regulators from paying closer attention to the problems in the housing market raises questions about the backgrounds of the advisers John McCain surrounds himself with -- especially in light of the recent populist turn of his campaign rhetoric.

The national press may have mostly left Alaska, but the legal maneuvering over Trooper-Gate continues. Yesterday, Attorney General Talis Colberg filed suit to throw out the subpoenas issued to witnesses in the legislature's investigation.

Colberg, who was a little-known assemblyman and private-practice lawyer until Palin tapped him for the AG job, argued that the Senate Judiciary Committee lacks the authority to issue subpoenas. Since early September, the Palin camp has maintained that the state personnel board, whose members are appointed by the governor, is the only appropriate body to conduct an investigation -- though that claim would appear to hold little water.

The list of witnesses currently defying subpoenas includes Todd Palin, and several of the governor's key aides. Nonetheless, the legislators running the probe have said that independent investigator Steve Branchflower will wrap up his report by October 11 and release a report soon after.

In response to Colberg's move, Sen. Hollis French, the Democrat overseeing the legislature's probe, told the Anchorage Daily News: "For over 200 years, legislatures have exercised their right to oversee the activities of the executive branch. Denying us that authority undermines the basic democratic process."

A separate lawsuit filed by five Alaska legislators aims to stop the investigation, which was initiated by a 12-0 bipartisan vote, entirely.

Sen. Ted Stevens (R-AK), currently on trial for accepting gifts from powerful oil company VECO, netted more than $238.5 million in earmarks for Alaska this year, narrowly edging out Sen. Thad Cochran (R-MS) as the top-scoring politician. In his four decades in the Senate, 84-year-old Stevens has built a reputation for steering funding his state's direction, earning the nickname "Uncle Ted." The ranking, compiled by the non-profit Taxpayers for Common Sense, showed that the special-interest spending included $2 million on a study about hibernation as treatment for battlefield trauma. (Wall Street Journal)

Alaska Gov. and GOP Vice Presidential candidate Sarah Palin returned campaign contributions yesterday after media reports circulated that linked the money to corrupt state legislators, such as the recently indicted state senator John Cowdery. Today, the Washington Post reports that Palin accepted more than $25,000 in gifts while governor from mining and other lobbying interests, including a $1,200 gold-nugget pin. In the 2006 governor's race, Palin campaigned on ending government corruption and special interest dealings. (AP and Washington Post)

Sarah Palin (R-AK) will not release her financial records until the day after her first vice-presidential debate, almost two weeks after the original due date. The Federal Election Commission granted the extension after the Palin campaign said it was confused about the deadline and needed more time. Biden filed the paperwork last week. (AP)

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Looks like Rick Davis isn't the only lobbyist problem the McCain camp is dealing with these days.

Mother Jones reports that two actively-registered lobbyists are currently working on John McCain's campaign for president.

Wayne Berman, co-chairs McCain's national finance committee. James Jay Baker co-steers McCain's National Steering Committee of Sportsmen for McCain. Both work for the lobbying firm, Ogilvy Government Relations as managing directors.

This month, the NRA -- a client of Baker and Berman's -- launched attack ads against Barack Obama. MoJo points out that besides conflicting with McCain's claims for running a straight-shooting, non-lobbyist campaign, Berman and Baker's presence also could come into conflict with the actual campaign rules that banned active lobbyists from working full time for the campaign, or participating in 527s or groups that "oppose any presidential candidate."

From Mother Jones:

Asked whether he might be in violation of the campaign's conflict rules, Berman told Mother Jones, "Hmmm, I hadn't thought of that." He said he was currently lobbying for the NRA but not involved in the group's campaign activities. "I'm in full compliance with campaign policy," he maintained. "I will check over there....I will continue to be in compliance. If that requires me to make changes, I'll make them." He added, "You've done me a favor" by raising this issue.

We knew we hadn't seen the last news report on McCain campaign manager Rick Davis' ongoing ties to the lobby firm he founded, Davis Manafort.

Newsweek has taken a look at annual filings made by the company to the Virginia state government. Those filings, the most recent of which is from April of this year, list Davis as one of two officers and directors of the firm.

As the magazine notes, that information suggests that in recent days, the campaign "appear[s] to have overstated the extent to which Davis had severed his relationship with his lobbying firm." A statement posted on the McCain campaign website by a spokesman Wednesday morning -- in response to reports that Davis's firm was being paid by the home-loan giant Freddie Mac as recently as this month -- asserted that Davis "separated from his consulting firm, Davis Manafort, in 2006." And a campaign spokeswoman wrote in an email to Newsweek Tuesday that Davis "left" the firm that year.

Of course, the fact that someone is listed as an officer on a corporate filing doesn't prove that he was involved in the day-to-day running of the company during the period in question. But Newsweek's find will certainly keep the heat on Davis, who yesterday skipped lunch with reporters, at a time when McCain would prefer the focus to be on his own efforts, belated and vainglorious as they may be, to help avoid a financial meltdown.

The FBI yesterday released new evidence in their prosecution of Bruce E. Ivins, who is accused of sending the 2001 anthrax mailings, presenting an e-mail and more details about his conduct in the lab. The case, which began in 2001, has come under attack for failing to conclusively link Ivins to the anthrax attacks. Ivins committed suicide in July. (Washington Post)

Investigation of troubled insurance giant American International Group began in March, prompted by the company's record losses in Feb. The probe, one of 25 currently in process, is meant to determine if company leaders misrepresented their holdings to the public. This month the federal government funneled $85 billion to AIG, which has faced federal investigation in the past, to prevent the firm from going bankrupt. (Washington Post)

The House ethics committee yesterday initiated a formal investigation of Rep. Charles Rangel (D-NY), who has been accused of a range of abuses, including misusing the House's garage to store an old car and questionable real estate dealings. The allegations have led to calls that Rangel resign from the powerful Ways and Means Committee, which he chairs. Last week Rangel maintained his innocence and invited the committee to look into his affairs. (The Hill)

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The trial of Sen. Ted Stevens has officially begun, with attorneys making their opening statements at 9:30 this morning to the jury of mostly white-collar professionals.

It has been just under two-months since the sitting senator was indicted on seven counts of false statements for allegedly lying on his financial disclosure reports on gifts he received from the oil pipeline company, VECO. Stevens demanded a speedy trial and attempted to have the case moved to Alaska in part to accommodate his ongoing re-election campaign in Alaska. District Court Judge Emmet Sullivan complied with a quick court date, but declined to move the trial out of the jurisdiction in which the charges were filed -- Washington, D.C.

Among the witnesses scheduled for today, is John Hess, a former VECO engineer whose initials are on the renovation plans to Stevens' home, the Anchorage Daily News reports.

The star witness in the case is former VECO CEO Bill Allen. In attempts to discredit Allen, Stevens' attorneys have requested his medical history and recently alleged in court filings that Allen is receiving a windfall of $40 million for his cooperation with the case, a charge which has been disputed in subsequent filings.

Stevens own appearance on the stand has been the subject of much debate, with Stevens saying he intends to testify but will follow the advice of his lawyers.

We'll be bringing you updates throughout the day on this historic trial, so stay tuned.

A prosecutor in the trial against a prisoner who is on trial for war-crimes, has quit the case because of concern over the defendant's lack of due process, defense attorneys claim.

Lt. Col. Darrel Vandeveld filed a four page declaration stating that "potentially exculpatory evidence has not been provided" to the defense.

The prisoner, Mohammed Jawad, has been awaiting trial since his arrest in 2002 for attempting to commit murder for allegedly throwing a grenade into a jeep filled with troops. A judge recently set his trial for December.

From the Los Angeles Times:

"He was uncomfortable being a prosecutor under the conditions, and [his superiors] told him to do his job," [Michael] Berrigan [deputy chief defense counsel for the commissions] said, adding that Vandeveld then took his concerns to higher authorities but was rebuffed.

Both defense lawyers said Vandeveld had spelled out his allegations in the sealed affidavit. Vandeveld said in his declaration that prosecutors knew Jawad may have been drugged before the attack and that the Afghan Interior Ministry said two other men had confessed to the same crime.


The lead prosecutor has denied that "ethical qualms" with the trial were behind Vandeveld's motives, describing him as a "disgruntled" prosecutor "who was disappointed that his superiors did not agree with his recommendations in the case."

In a big admission from the Bush White House, Condoleezza Rice has admitted to Senate investigators that senior administration officials met repeatedly between 2002 and 2003 to discuss the CIA's use of harsh interrogation methods on detainees.

In written statements to Senate investigators looking into the use of torture against detainees, Rice gives new details about administration members who were involved, and their consideration of a military training program, SERE (Survival, Evasion, Resistance and Escape) to be used in interrogation.

From the L.A. Times:

In particular, Rice wrote in the Sept. 12 statement that officials discussed simulated torture techniques that elite U.S. soldiers were subjected to as part of a survival training program, and that she and other officials were told that such methods "had been deemed not to cause significant physical or psychological harm."

Rice, who was serving as national security advisor at the time of the discussions, did not identify the source of that assertion. She was referring to a U.S. military program known as Survival, Evasion, Resistance and Escape, or SERE, which at times has included waterboarding and other controversial methods subsequently employed by the CIA.

. . . Rice did not disclose who at the meetings, but said that she had "asked Atty. Gen. [John] Ashcroft personally to review and confirm the legal advice" being prepared by the Department of Justice on the CIA's interrogation plans.

Other senior officials who routinely attended so-called principals meetings included then-Defense Secretary Donald H. Rumsfeld; Alberto R. Gonzales, then the presidential counsel; and David S. Addington, the vice president's counsel.

TPMLivewire