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It's a free country, damn it, and the FEC ought to quit hasslin' John McCain.

That, at least, is the shorter version of the letter the McCain campaign's lawyer Trevor Potter (a former FEC chairman himself) sent the FEC yesterday. In the letter, Potter argued that the campaign didn't need the FEC's say-so to opt out of the public financing system. As the AP reports:

...Potter said the Supreme Court concluded that public financing for campaigns is constitutional because it is voluntary. "As a result, candidates have a constitutional right to withdraw from the program."

To recall the stakes: the public financing system for the primaries entails a $54 million spending limit, an amount that McCain has pretty much already spent. If the FEC were to decide that he could not leave the program, it would be an incredible problem for his campaign.

Of course, the chances of the FEC of doing anything are zilch right now, because David Mason, the Republican chairman, is one of only two commissioners. Four nominees are stuck in the Senate because of the fight over Hans von Spakovsky. But Mason has written the McCain campaign to tell them that McCain cannot withdraw from the program without the FEC's say-so, since McCain effectively entered into a contract when he opted in to the program last year.

Potter, as you can see above, doesn't think much of that argument. But then there's the other problem: the McCain campaign's creative financing, the very clever $1 million bank loan last December. The burning question for Mason is whether the loan was just clever enough or too clever by half.

We outlined the deal in detail here. But the basic idea is that McCain's lawyers knew he could not use the $5.8 million in public matching funds the FEC had certified for his campaign as collateral for the loan, since that would have effectively locked him into the program. So the campaign promised the bank that if he lost the primary, he'd opt out of public financing, but stick in the race, and then opt back in, get those matching funds, and then pay off the bank. That way, voila! he wasn't using that prior certification as collateral. If you're confused, you're not the only one.

The bank's lawyers (one of them another former FEC chairman) laid it out in a letter which also made its way to the FEC:

"The bank does not now have, nor did it ever receive from (McCain's campaign) committee, a security interest in any certification of matching funds," [Scott] Thomas and lawyer Matthew S. Bergman wrote....

The loan documents specifically state that the collateral did not include McCain's right to the public funds. But the agreement with Fidelity & Trust Bank of Bethesda, Md., required him to reapply for matching funds if he withdrew from public financing and lost early primary contests.

"It is our understanding that, to date, none of those events have occurred," the bank lawyers wrote.

Very clever.

So now we'll see if the FEC's current chairman buys all this. And no matter what he says, it seems likely this issue is far from resolved.

Last week, Col. Morris Davis, the former prosecutor told reporters that he'd had a conversation with the Pentagon's general counsel William Haynes, during which Haynes had said about the Gitmo tribunals that "We can't have acquittals, we've got to have convictions."

It made Haynes, already a controversial figure because of his role crafting the Pentagon's interrogation policies, even more controversial. Davis said that he resigned when he was put under Haynes' chain of command.

And now Haynes is gone.

A press release this afternoon from the Department of Defense:

The Department of Defense announced today that General Counsel of the Department of Defense William J. Haynes II is returning to private life next month.

Secretary of Defense Robert M. Gates said of Haynes, “I am sorry to see Jim leave the Pentagon. I have valued his legal advice and enjoyed working with him. Jim held this important post longer than anyone in history and he did so during one of America’s most trying periods. He has served the Department of Defense and the nation with distinction.”

Said Haynes, “I thank the President and the Secretary of Defense for their confidence and for the opportunity to serve. I leave the Pentagon humbled and inspired by the selfless sacrifices of the men and women, uniformed and civilian, who defend our country. And, I thank their families.”

Haynes had already tried to move out of the Pentagon once -- the White House nominated him to be a federal appeals court judge, a nomination that ultimately failed due to Democratic opposition.

From Justin over at ABC:

Thirty-five counts won't keep Rick Renzi down.

The Arizona congressman will not step down in the face of a federal indictment handed down last Friday, he announced in a press release late Monday evening.

"“I will not resign and take on the cloak of guilt because I am innocent," the statement read. "My legal team. . .will handle these legal issues while I continue to serve my constituents."

Renzi is scheduled to be arraigned on March 6th.

Karl Rove, now a frequent talking head on Fox News, for the first time publicly addressed the Don Siegelman case today. You can watch his appearance here:

It amounted to a complete denial that he ever knew Dana Jill Simpson (he might have met her at a fundraiser, he said, but didn't "believe" that he ever had) and that she ever worked on any campaign with which he was involved. "I never asked her to do a darn thing," he said. "It's a lie what she said."

Simpson, a Republican lawyer, told 60 Minutes and congressional investigators (under oath) that Rove had asked her to take a picture of Siegelman cheating on his wife -- and that this was just one of many requests that he'd made of her. Simpson also has testified that she was on a conference call where Rove's friend William Canary recalled talking to his buddy Karl about sicking the Justice Department on Siegelman, adding that “my girls would take care of him,” referring to U.S. attorney Leura Canary (his wife) and another U.S. attorney in the state.

Rove also took the opportunity to scold 60 Minutes for not interviewing him again after first conducting an off the record interview with him "five months ago." He did not say whether he would have agreed to do an on-camera interview if he'd known precisely what 60 Minutes was going to report. But "60 Minutes is now the National Enquirer of network news," in his estimation.

Simpson will be on MSNBC tonight on the Dan Abrams show.

Another day, another public declaration by President Bush that the Democrats are exposing the U.S. to another terrorist attack.

Meanwhile, reporters tried to get White House spokeswoman Dana Perino to explain how the White House simultaneously condemns the Democrats for letting the Protect America Act lapse when the law lapsed because the administration and Republicans opposed it. See if you can target the recurring theme. From today's press briefing:

Q So what does the White House think of the op-ed from the Democrats that accuse the President of using scare tactics and playing political games? And they say if the President really believed the expiration of the act created a danger, he should have accepted their offer for an extension.

MS. PERINO: Well, one, the House proved that they couldn't even pass an extension, so that wasn't an option. An extension wasn't an option. But we had a response to the op-ed, that I issued.

I think that fear-mongering and the use of the phrase "scare tactics" is something that the Democrats -- it must be, like, one of their favorite words, or it must poll very well, because they use it almost every time.

What we have done is state facts; that this is what the law said; this is what the intelligence community says that they need; this is what the bill in front of the House says, and it's one that was designed with the intelligence community, in concert with them, so that they would be able to have the buy-in and say that they would get what they need out of that bill. It passed 68-29; we think they should go ahead and pass it.

The issue really right now between the House and the Senate, as far as I can tell, the biggest issue is retroactive liability protection, and in their op-ed they just had a passing glance to that issue. But it is one of the biggest sticking points, because at the end of the day if we don't have the companies helping us, then we won't have a program.

And later:

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In the wake of last night's 60 Minutes report, attorneys for Don Siegelman will be requesting a special counsel to investigate the politicization of the prosecution.

Vince Kilborn, one of the attorneys handling Siegelman's appeal, said that the request, which will be addressed to Attorney General Michael Mukasey, will focus on 60 Minutes' revelation that prosecutors had such problems with Nick Bailey, the government's star witness, that he had to write out his testimony over and over again to get it straight. Such notes would have been required to be turned over to Siegelman's counsel before trial. Prosecutors turned over no such material, 60 Minutes reported.

Kilborn said that the request will focus on the obvious conflict of interest for the local U.S. attorney's office and the Justice Department to initiate an investigation. The request will be placed in the context of the U.S. attorneys firings scandal, which demonstrated the politicization of the Department. "There needs to be a hard look at this case by someone independent."

Mukasey has said that issues with Siegelman's case should first be heard on appeal. But Kilborn said that would mean that Siegelman would spend another "year or so, maybe two" before he had a hope of being vindicated. "That's just not acceptable."

Kilborn said he expected to send his letter tomorrow.

Rep. Rick Renzi's (R-AZ) case is moving along, with the judge setting an arraignment date for March 6th.

Renzi's lawyers have said that he's innocent and will plead not guilty. The judge also set a trial date for April 29th (a date one would expect to be pushed back).

House Minority Leader John Boehner (R-OH) began a push for Renzi to resign on Friday, but for now, at least, he seems to be laying low.

Stepping up the pressure on House Democrats, the Foundation for the Defense of Democracies has launched a national ad campaign criticizing Democrats for not passing the Senate's surveillance bill.

According to the group's press release, the ad "will be seen on cable and satellite stations throughout the country and is also seen locally in 17 media markets across the United States." The ads target 15 House Democrats, such as Rep. Tim Walz (D-MN). Brian Wise, the spokesman for the group, told me that the group had chosen the 15 because they were Dems "who we believe understand the issue and who would be the most effective to pushing the House leadership to vote on this." He added: "politics really has nothing to do with it."

You can see the ad here:

It's similar in tone to an ad the House Republicans put together last week -- and similarly misleading. It claims that the lapse of the Protect America Act has meant that "new surveillance against terrorists is crippled."

Dems, including Sen. Jay Rockefeller (D-WV), the force behind the Senate bill, vehemently disagree. And as even The Washington Times concluded, the lapse of the law would have "little effect" on surveillance collection.

Wise said that the lapse of the act has meant that "we can no longer do electronic surveillance on new targets" without a warrant and that such warrants "can take hours, days, weeks to process." Administration officials have claimed that the lapse has "impaired" intelligence collection.

You can see the group's press release below. The ad is actually paid for by an affiliated 501(c)(4) group called Defense of Democracies, which Wise said was formed last week.

The group claims to be "non-partisan," but has a decided rightward slant in its leadership. Wise said that the group had never run ads before, but that "the importance of this issue" had pressed the group to act. He said a "number of donors, patriotic Americans, we like to call them," had provided the money for the buy. He would not disclose who they were, and such non-profits are not required to disclose their donors.

Update: The Minnesota blog Bluestem Prairie, which got on the case this weekend, lists the following Dems as targets:

Joe Courtney and Chris Murphy (CT); Carol Shea-Porter and Paul Hodes (NH); Jason Altmire (PA); Ron Klein and Tim Mahoney (FL); Gabrielle Giffords and Harry Mitchell (AZ); Jerry McNerney (CA); Melissa Bean (IL); Joe Donnelly (IN); Nancy Boyda (KS); Michael Arcuri and Kirsten Gillbrand (NY) ; Steve Kagen (WI)

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The Democratic National Committee filed a complaint (pdf) today with the FEC concerning Sen. John McCain's (R-AZ) campaign financing problem. So where do things stand then? Keep in mind this is an unprecedented situation, so it's not really clear where things will go next.

The main problem remains: FEC Chairman David Mason says that "a candidate enters into a binding contract with the Commission” when that candidate opts in to the public financing system, so McCain will just have to wait until the FEC is up and running again to be formally released (remember that a logjam in the Senate over four nominees for the FEC has tied its hands). To which McCain and his lawyers say phooey: It's a candidate's "constitutional right" to opt out.

Very soon, the McCain campaign, already spending its way past $50 million, will be in violation of the public campaign financing system's $54 million spending limit for the primary (that cap lasts through the party's convention). Barring a miracle in the Senate, the FEC will remain unable to act officially with only two commissioners.

The DNC's complaint adds another variable to the mix. After receiving the complaint and giving two weeks for a response from McCain's campaign, FEC staff will ultimately give a recommendation to the commissioners whether to initiate a formal investigation. But ... since the FEC doesn't have a quorum, i.e. the four commissioners needed to act, the FEC could not approve an investigation.

From there, things could find their way into court. “The DNC may simply be setting the stage for a federal lawsuit to make John McCain obey campaign finance laws,” observed David Donnelly of Campaign Money Watch.

The McCain camp has said that they will respond to Mason's letter from last week. They'll do their best to explain why the campaign's very clever bank loan did not lock McCain into the system by using promised federal matching funds as collateral. But even if Mason were to conclude that McCain should be able to opt out (a big "if"), he's made clear that McCain cannot opt out without the FEC's say-so. So things seem likely to continue to get more and more interesting regardless of what happens.

In an election season when the electorate is passionately debating the relative merits of change, experience and straight talk, Milwaukee’s 6th District gave their one-term alderman, Michael McGee, a plurality of their votes in a 9-candidate race last Tuesday. He will face Milele Coggs in the aldermanic runoff in April.

What’s so unusual?

McGee is running his re-election campaign from his jail cell. He was arrested last May, and is still behind bars. Charged with 12 counts of election fraud, bribery and contempt in the state court and nine federal counts, which include bribery and extortion, he faces a theoretical, though unlikely, 115-year sentence if convicted of all the felonies. Though he posted bond on the state charges, the judge in the federal court is holding McGee without bail because he was allegedly intimidating witnesses even from prison in order to influence their testimony. McGee could take office from jail if elected, because his trial dates are after this April’s runoff. If convicted as a felon, he would be removed from office.

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