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Inside Roll Call's (sub. req.) overview of legislative maneuvers on the two Democratic surveillance bills is this bit of analysis about how the Senate Judiciary Committee will lose influence over the Senate bill if it doesn't mark up what the intelligence committee has reported out:

If Judiciary doesn’t act on anything, the panel could forfeit its right to weigh in and the Rockefeller measure would proceed as-is to the Senate floor. (There’s no guarantee Reid would bring it up if that happened, however.)

“If [Judiciary members] want to stay in the game, they’re going to have to mark something up,” pointed out one civil liberties activist.

The panel's top senators, Pat Leahy (D-VT) and Arlen Specter (R-PA), suggested yesterday that the committee might not act on the intelligence committee's bill if the White House doesn't allow it to see documents outlining the legal basis for the Bush administration's surveillance program. But that implicit threat might backfire. To be out of the legislative process over surveillance programs that Judiciary has struggled for nearly two years to oversee would be a huge blow to the committee's prestige. Furthermore, it might be a missed opportunity to modify what civil libertarians consider the bill's excesses, including retroactive legal immunity for telecommunications companies and a diminished role for the FISA Court over foreign-to-domestic surveillance.

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The government’s largest terrorist financing case ended yesterday in a mistrial. The prosecution of the Holy Land Foundation was supposed to be a high profile win for the Justice Department. The case has been controversial since allegations surfaced that a "summary of wiretapped conversations attributed inflammatory anti-Jewish statements to members of the charity that were not found in the actual transcripts of the conversations.” (US News & World Report)

Is Blackwater heading south? To the border, that is. Blackwater is planning on building a massive 824-acre military training site just eight miles from the U.S.-Mexico border. According to Salon, Blackwater executives have “lobbied the U.S. government since at least 2005 to help train and even deploy manpower for patrolling America's borders.” (Salon)

A NASA spokesman said that denying the Associated Press’s request to see a database on safety lapses in U.S. aviation on the grounds that it might scare the public "was probably not the best thing to do." NASA will review the AP’s request, submitted 14 months ago, and will release a final report after they analyze all the data. (The Washington Post)

Mitt Romney’s make-over is proving expensive. Harper’s Magazine is reporting that Romney “has employed more than a hundred different consultants, making combined payments to them of at least $11 million—roughly three times the amount spent by John McCain or Rudy Giuliani.” But even with all this money for branding, or perhaps because of it, “the image of slickness is heightened by Romney’s appearance and persona” and “the problem of phoniness can never be far from the brain.” (Harpers)

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Ambassador Patrick Kennedy has finally delivered his assessment of the State Department's relationship with security contractors in Iraq to Condoleezza Rice. Behind closed doors yesterday, the ambassador, who was tasked with making a comprehensive review of State's contractors following the Nisour Square shooting, told the secretary of state that there were serious problems "with virtually every aspect of the department’s security practices, especially in and around Baghdad, where Blackwater has responsibility," reports The New York Times.

Combined with today's report from Stuart Bowen, the special inspector general for Iraq reconstruction, that finds an "environment" conducive to waste and fraud in the oversight of DynCorp's $1.2 billion Iraq contract, it's easy to see why one State Department official told the paper that the department's contracting process is caught in "a perfect storm of bad events."

Among Kennedy's recommendations is to create a "special coordination center" with the U.S. military to ensure that contractor movements within a military commander's area of operations don't conflict with the commander's orders. It's unclear whether that means the military would actually control contractor operations, as Defense Secretary Bob Gates is reportedly considering, but it would move Blackwater, DynCorp and Triple Canopy contractors out of the exclusive control of the State Department for the first time. When Gates returns from his European trip, he and Rice will discuss the future of State contractors in Iraq.

In a great understatement, Kennedy also recommends closer coordination with the Iraqi ministries:

“They don’t have the right communications, they don’t have the right procedures in place, and you’ve got people operating on their own,” said one official who has been briefed on the report but who spoke on the condition of anonymity because it has not been released yet. “This is not up to the degree it should be.”

And, needless to say, they're also vulnerable to being murdered by drunken Blackwater contractors during rip-roaring Green Zone Christmas parties.

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Earlier today, Blackwater's Anne Tyrrell disputed an allegation from Rep. Henry Waxman (D-CA) that the company has committed tax fraud by classifying guards as independent contractors instead of employees with the following statement:

The U.S. Small Business Administration has determined in an official finding applying "the criteria used by the IRS for Federal income tax purpose," that "Blackwater security contractors are not employees."

But according to the Small Business Administration, that's not exactly true.

SBA spokeswoman Christine Mangi says that SBA did make such a determination -- on November 2, 2006. But it was in reference to a dispute about who was a company employee on a project to provide services to Navy vessels in Guam, not Iraq. The ruling, she says, "was for this particular procurement," not an SBA finding about Blackwater personnel in general, contrary to the suggestion of Blackwater's response to Waxman.

Furthermore, Mangi explains, the IRS hardly has to defer to the SBA determination about who's an independent contractor and who's an employee. "Our findings are for the sole purposes of our small business contracting programs and, to the best of our knowledge, carry no legal weight outside of our programs," she says.

Tomorrow morning the House Judiciary Committee will hold a heading on whether politics spurred a series of prosecutions, focusing on the cases of Cyril Wecht and former Gov. Don Siegelman (D-AL).

Unfortunately, Dana Jill Simpson, the Republican lawyer who has given sworn statements that implicate Karl Rove in the decision to prosecute Siegelman is not on the witness list.

Siegelman's legal team has long-maintained that the decision to prosecute the former Democratic governor was an assault from Republicans in the state with connections at the Department of Justice. One of Siegleman's former lawyers and former US attorney for Alabama, Doug Jones, is set to testify tomorrow. Jones already told House investigators that in 2004 lawyers in Montgomery mentioned that when the case against Siegelman stalled, they were told by Justice Department officials in Washington to "take another look at everything." Jones gave the same story to The New York Times last month.

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It's not just Blackwater! Rep. Henry Waxman (D-CA) has another State Department security contractor in his sights -- industry pioneer DynCorp, which, in addition to guarding diplomats in northern Iraq, has reaped over $1 billion from State since 2004 to help train the Iraqi police.

Corruption and mismanagement in the Iraqi police is an old story. The U.S.'s special inspector general for Iraq, Stuart Bowen, told Waxman's House oversight committee earlier this year that DynCorp had significantly overbilled the State Department. But the extent of the misconduct is unknown: department officials have failed for months to provide documentation about the origins and terms of the contract to the committee, despite numerous promises. Making matters even fishier, State representatives told Waxman's staff that a single official handles all DynCorp contracts with the department and has for a decade -- far longer than is typical in agency-contractor relationships.

Waxman wrote to Secretary of State Condoleezza Rice today to remind her that the committee wants the documents on the DynCorp contract that the department promised it in May. There's an urgency here: last month, a commission headed by Marine General James Jones found the Iraqi police in serious disarray.

Full text of the letter after the jump.

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Tomorrow, Dick Thornburgh, the attorney general for the final year of George H. W. Bush's presidency, will testify to Congress about his experience of the politicization of the Justice Department.

Thornburgh's run-in with Alberto Gonzales' DoJ came via the case of Dr. Cyril Wecht, a celebrity forensic pathologist, prominent Pennsylvania Democrat, and up until his indictment on a raft of fraud charges, coroner of Allegheny County. Thornburgh is one of Wecht's defense lawyers, and his complaints stem from what he's called the "sheer intensity" of the investigation, which involves relatively minor accusations that Thornburgh says should have been handled by the state ethics commission.

As a means of showing the relative triviality of the charges (the 84-count indictment doesn't put a price tag on Wecht's fraud), Wecht's lawyers have calculated that the cumulative cost for the 37 charges in the indictment that involve improperly charging the county for gasoline and mileage costs add up to $1,778.55. The most colorful of the charges, of course, involve the elaborate body snatching scheme: prosecutors allege that Wecht gave a local Catholic university unclaimed bodies in exchange for laboratory space.

The source of the investigation's "intensity" is U.S. Attorney for Pittsburgh Mary Beth Buchanan, a member of the DoJ's inner circle who played a role in the U.S. attorney firings. It's not the first time that Buchanan has drawn fire. During the heat of the scandal, a former assistant U.S. attorney in the district (from 1995-2000, before Buchanan took over) publicly called on Buchanan to resign because of "the extent to which she has looked to Washington for direction and political advancement." Or to put it in plainer terms: Buchanan has prosecuted a number of Democrats but no Republicans.

According to Wecht's lawyers, Thornburgh among them, Buchanan's office was single-minded in their pursuit of their high-profile quarry. Although Wecht holds the modest position of county coroner, he's a prominent Democrat in the state, even once running for the Senate in 1982. And it's only a minor exaggeration to say that he's made an appearance in just about every well-known murder case in the past 30 years, including O.J. Simpson, JonBenet Ramsey, Vincent W. Foster Jr., Martha von Bülow, not to mention Elvis Presley and both Kennedy brothers.

Here's Thornburgh's story, which he laid out in an affidavit this summer and will tell to the House Judiciary Committee tomorrow. Not long after Thornburgh began representing Wecht in the summer of 2005, Buchanan began pressing to indict him on a number of fraud charges. Finally, in December, she sent him a target letter, usually a sign of imminent indictment.

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Another day, another letter from top Senate Judiciary Committee members Pat Leahy (D-VT) and Arlen Specter (R-PA) demanding the warrantless surveillance documents they subpoenaed from the White House and the Justice Department 100 years ago.

Last week, the White House released the judiciary committee's long-sought material -- documentation of the legal basis for the warrantless surveillance program -- to the Senate intelligence committee instead. That committee was about to complete draft legislation of a new surveillance bill, and the White House desperately wanted to include a provision granting retroactive legal immunity to telecommunications companies that complied with the warrantless surveillance program. The White House conditioned access to the documents on a willingness to grant immunity. Sure enough, quid met quo.

Only judiciary committee members, cut off from the documents, didn't appreciate the White House conditioning access to the documents on providing immunity, which Leahy and Specter say "would turn the legislative process upside down." After all, there is the small matter of a subpoena here. In their latest letter today to White House Counsel Fred Fielding, the two senators remind the White House that the path to approving the bill runs through their committee, which will mark up the bill ahead of next month's scheduled floor debate. "If the Administration wants our support for immunity, it should comply with the subpoenas, provide the information, and justify its request."

Full text of the letter after the jump.

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Blackwater spokeswoman Anne Tyrrell just released the following statement in response to Rep. Henry Waxman's (D-CA) allegations that Blackwater has committed tax evasion:

Chairman Waxman has released a new thirteen page letter alleging that Blackwater cannot treat its personnel in Iraq and Afghanistan as “independent contractors,” and contends that they must be treated as employees for IRS purposes. The Chairman’s contention is incorrect.

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It just gets worse and worse for Blackwater's relationship with the House Oversight and Government Reform Committee.

Today, committee chairman Henry Waxman (D-CA) accused Blackwater CEO Erik Prince of hiding "tens of millions of dollars, if not more" in Social Security, Medicare and retirement taxes by classifying its security guards in Iraq as independent contractors. In a letter (pdf) to Prince, Waxman also called a financial settlement reached with one such former independent contractor "deplorable." The settlement required that the ex-guard not disclose a March 2007 IRS ruling that Blackwater's tax records were out of whack; and the guard was specifically prevented from disclosing that to any "politician" or "public official."

Either last year or early this year (it's not clear from the letter), a former Blackwater guard sought to determine whether the tax code designates him a Blackwater employee, which would entitle him to compensation for the money he spent paying his own taxes in 2005. The company received the IRS arbitration (pdf) in March: the services rendered by the ex-guard for the company in Iraq qualified him as an employee. That would explain why the non-Blackwater private guards in Iraq on the same State Department contract, working for DynCorp and Triple Canopy, work as full-time employees of their companies, which take care of their tax liability.

In testimony earlier this month to the committee, Blackwater CEO Erik Prince described the company's decision to classify Blackwater's guards as independent contractors as a "model that works," preferred by the guards for providing flexibility. He did not mention the IRS ruling in his sworn testimony, despite questions from Washington, D.C. Delegate Eleanor Holmes Norton into Blackwater's hiring practices.

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