I. Lewis "Scooter" Libby:
Cheney Aide Libby Is Indicted On Perjury, Other Charges

Powerful Adviser Resigns Post; Rove Remains in Legal Jeopardy 

ANNE MARIE SQUEO and JOHN D. MCKINNON / Wall Street Journal 28oct2005

In a critical blow to an already hobbled Bush administration, I. Lewis "Scooter" Libby, the vice president's chief of staff, was charged with five criminal counts by a federal grand jury for his involvement in the leaking of a covert agent's identity.

Mr. Libby was indicted on two counts of making false statements, two counts of perjury and one count of obstruction of justice. Mr. Libby allegedly lied to investigators about how and when he learned of the identity of Valerie Plame, a Central Intelligence Agency official, and then disclosed her identity to reporters. (Read the indictment)

He resigned after the charges were made public. Vice President Cheney issued a statement saying he had accepted Mr. Libby's resignation "with deep regret." He added that Mr. Libby was entitled to a presumption of innocence in the case and praised his longtime aide as "one of the most capable and talented individuals I have ever known."

At a news conference, Special Counsel Patrick Fitzgerald said the inquiry was substantially complete, though he added ominously, "It's not over."

According to the indictment, Mr. Libby lied to FBI agents twice in 2003 and then committed perjury in his grand jury testimony in March 2004. Intentionally disclosing the identity of an undercover intelligence agent can be a crime under a 1982 law. Significantly, Mr. Fitzgerald didn't allege any violation of that law but instead chose to focus on assertions Mr. Libby wasn't forthcoming with investigators.

At his news conference, Mr. Fitzgerald said that when Mr. Libby was first interrogated, he "gave the FBI compelling story" —— that in conversations about Ms. Plame, he was "just passing gossip from one reporter to another." Mr. Fitzgerald said, "If only it were true. It is not true, according to the indictment."

While Mr. Cheney hasn't been charged with any crime, he is named in the indictment as the person who told Mr. Libby about Ms. Plame. That raises the prospect that his role will be explored in any trial and he may even be called to testify. As such, questions about Mr. Cheney and his role in the leak may continue to dog him for some time.

The long—awaited charges were supposed to bring a climactic end to a two—year inquiry that has involved the questioning of two dozen administration officials, including President Bush and Mr. Cheney.

On Thursday evening, however, Mr. Fitzgerald informed Karl Rove, Mr. Bush's chief political adviser and deputy chief of staff, that he wouldn't be indicted today but was still in potential legal jeopardy, signaling that a legal cloud will continue to hang over the White House.

Mr. Rove's attorney, Robert Luskin, yesterday said Mr. Fitzgerald "has advised Mr. Rove that he has made no decision about whether or not to bring charges and that Mr. Rove's status has not changed. …We are confident that when the Special Counsel finishes his work, he will conclude that Mr. Rove has done nothing wrong."

Charging Mr. Libby will bring an uncomfortable spotlight on the vice president's office. While little known outside Washington, Mr. Libby was the most powerful adviser to one of the most powerful vice presidents in U.S. history. In addition to being chief of staff, Mr. Libby was Mr. Cheney's national security adviser and held the title of assistant to the president.

The initial purpose of the probe was to determine whether White House officials exposed the identity of a covert Central Intelligence Agency official, Ms. Plame, to undercut criticisms of the war in Iraq by her husband, former ambassador Joseph Wilson. After Mr. Fitzgerald took on the case as a special prosecutor in December 2003, however, he quickly won the broader authority to investigate other crimes that came up in the course of his probe.

The timing of the charges couldn't be worse for Mr. Bush, whose second term hasn't shown the same surefooted style of his first term. In recent months, the president has been hit by a series of setbacks —— the withdrawal Thursday of Supreme Court nominee Harriett Miers amid pressure from his own party's conservative stalwarts; mounting criticism of the war in Iraq as American lives lost topped 2,000; and a bungled response to Hurricane Katrina. His approval ratings now hover at just under 40% and his ambitious plans to remake Social Security and the U.S. tax system are stuck in first gear.

More broadly, the move is the clearest evidence yet of the heavy political and emotional price that Mr. Bush and his aides are paying for their decision to invade Iraq to prevent it from becoming a nuclear power. While Mr. Bush insists that he has no plans to depart from the course he's set, he now faces the risk that the war's conduct —— both past and present —— could virtually consume his presidency, and leave him with a legacy of failure. An October poll from the Pew Research Center shows that for the first time, more Americans believe that Mr. Bush's presidency will be remembered as a failure than as a success.

The charges also add to the legal woes of the Republican Party at large, undermining hard—won control of all the levers of power in Washington. The party is already reeling from a succession of legal and ethical woes that have hit the majority leaders of the House and Senate, as well as a criminal investigation into a top lobbyist who was a big Bush fundraiser.

Democrats used the indictments to launch a broader assault on White House credibility. "This case is bigger than the leak of highly classified information," said Senate Minority Leader Harry Reid of Nevada. "It is about how the Bush White House manufactured and manipulated intelligence in order to bolster its case for the war in Iraq and to discredit anyone who dared to challenge the president."

Even though Mr. Rove has escaped indictment for now, the continued scrutiny of him is sure to dilute his effectiveness and could significantly hurt the White House.

Best known for being a superb political strategist who has clinched victories for Mr. Bush in two gubernatorial and presidential campaigns, he's also taken on a more strategic role in the White House, straddling politics and policy issues and frequently serving as Mr. Bush's voice in negotiations in Congress.

Some Republicans link the administration's recent setbacks on Hurricane Katrina and Supreme Court nominee Harriet Miers to Mr. Rove's legal distractions —— and say they fear worse now. More than just a political "architect,'' Mr. Rove puts his hands on virtually every major policy initiative the White House cooks up. As deputy chief of staff, Mr. Rove oversees political affairs, as well as the top policy councils —— domestic, national security and economic and leads what the White House has come to call "stratergy,'' ——the intersection between politics and policy.

Even if Mr. Rove remains in the White House, Mr. Bush is expected to reshuffle the management of his administration. Such a shake—up may be long overdue. Many of his top aides have been with him since the election campaign of 2000 and are worn out. Second terms often result in shake—ups of White House staff, and there has been much speculation that Mr. Bush could bring in someone like Ken Mehlman, the head of the Republican National Committee, or Ed Gillespie, a lobbyist, to top positions.

Longer term, the Republican party faces mid—term congressional elections in a year with a weakened leader. A president is a standard—bearer for his party in any mid—term election, even though he is not on the ballot, and Mr. Bush is a particularly troubled standard—bearer right now. Even if things were going well, history suggests Republicans would lose seats next year in Congress, which they control by 14 seats in the House and five in the Senate. In five of the last six two—term presidencies, the president's party lost seats in both houses midway through the second term.

The investigation has also sorely tested another institution —— the media. Mr. Fitzgerald aggressively solicited the testimony of several reporters, demanding that they reveal their confidential sources. Long a sacred principle, the notion of never revealing an anonymous source came under intense pressure. Two reporters, Time magazine's Matthew Cooper and New York Times reporter Judith Miller, fought highly public legal battles with Mr. Fitzgerald over the right to refuse subpoenas. Mr. Cooper chose to testify after receiving a last—minute waiver from a source. Ms. Miller refused, and served 85 days in jail, saying that she didn't have a sufficient waiver. She finally agreed to testify, saying that she had discussed Ms. Plame, albeit perhaps not by name, with Mr. Libby, a contradiction of Mr. Libby's public statements. Amid the debate over their respective decisions was a fear that prosecutors will now feel more empowered to go after journalists' sources.

The origins of the leak case goes back to early 2003, a time when the country was polarized over the U.S. push to oust Saddam Hussein and a presidential election was gearing up. The debate over whether to go to war with Iraq was heated and the Bush administration came under fire for rushing the invasion and basing its urgency on flawed information. Controversy arose after the president's January 2003 State of the Union address, where he included the now—infamous "16 words:" "The British government has learned that Saddam Hussein recently sought significant quantities of uranium from Africa."

Two months later, those words were debunked by the head of the International Atomic Energy Agency and Mr. Wilson began a behind—the—scenes campaign to turn up the pressure on the White House, telling people that he had been sent by the government on a fact—finding mission to Niger in February 2002 and had found no evidence of the uranium claims. Mr. Wilson went public on July 6, 2003, writing an opinion piece in the New York Times entitled "What I Didn't Find in Africa," and appearing on NBC's "Meet the Press."

Within a week, the first news account connecting Mr. Wilson's trip with his wife's employment at the CIA appeared in a column by Robert Novak in the Chicago Sun—Times. Mr. Wilson and several Democrats were outraged, saying administration officials had orchestrated a smear campaign that violated a 1982 law that bars intentionally disclosing the identity of an undercover intelligence agent.

Mr. Wilson accused Mr. Rove directly. In a speech in August 2003, he said: "At the end of the day, it's of keen interest to me to see whether or not we can get Karl Rove frog—marched out of the White House in handcuffs. And trust me, when I use that name, I measure my words." In subsequent televised interviews, he softened his position to leave out the handcuffs.

Despite that rhetoric, few people in those early days expected the case to escalate to this level. But congressional Democrats and even news organizations pushed for an independent prosecutor to investigate the matter, which had been turned over to the Justice Department by the CIA as is customary when classified information appears publicly. Critics, though, said that such an investigation couldn't be conducted fairly and independently while being overseen by John Ashcroft, the attorney general at the time who knew Mr. Rove well.

A new Deputy Attorney General, James Comey, appointed his close friend and no—nonsense prosecutor, Mr. Fitzgerald, the U.S. Attorney in Chicago, to spearhead the case. Mr. Comey granted him broad prosecutorial authority to follow the facts wherever they lead without needing to check back with the Justice Department.

——Christopher Cooper and Jeanne Cummings contributed to this article