PENGUIN BOOKS

ARMED MADHOUSE

Greg Palast has the rare distinction of being singled out by Prime Minister Tony Blair, who called the investigative reporter a liar for Palast’s 1998 undercover exposé of the cash-for-access deals within Blair’s cabinet, the Observer’s award-winning “Lobbygate” story. Not that Palast is loved by America’s powers that be. AWhite House spokesman said simply, “We hate that sonovabitch.” But Tribune Magazine calls him “The most important investigative reporter of our time” for his reports for BBC Newsnight and the Guardian and Observer. However, notes the Asia Times, “The top investigative journalist in the United States is persona non grata in his own country’s media.” Formerly an investigator of corporate fraud and racketeering for US labor unions, government and consumer groups, Palast is the author of the international bestseller The Best Democracy Money Can Buy. He is best known in his native USA as the journalist who broke the story of howjeb Bush purged thousands of black Florida citizens from voter rolls before the 2000 election, thereby handing the White House to his brother George. His report on the spike of the FBI investigations of the bin Ladens before September 11 and other stories have won him a record six “Project Censored” for reporting the news American media blocked from publication and broadcast in the USA.

Palast is also the author of Democracy and Regulation, a treatise on energy corporations and government control, commissioned by the United nations and based on his lectures at Cambridge University and the University of Sao Paulo. Beginning in the 1970s, having earned his degree in finance studying under Milton Friedman and free-trade. luminaries, Palast went on to challenge their vision of a New Global Order, working for the United Steelworkers of America, the Enron workers’ coalition in Latin America and consumer and environmental groups worldwide. As an investigator for the Chugach Natives of Alaska, he uncovered the oil company frauds which led to the grounding of the Exxon Valdez. Palast, Guerilla News Network’s Guerilla of the Year, is Patron of the Trinity College Philosophical Society, an honor previously held by Jonathan Swift and Oscar Wilde. His writings have won the Financial Times David Thomas Prize – nd inspired the Eminem video Mosh.

ARMED MADHOUSE

Undercover dispatches from a dying regime

GREG PALAST

PENGUIN BOOKS

PENGUIN BOOKS

Published by the Penguin Group

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First published in the United States of America by Dutton, a member of Penguin Group (USA) Inc. 2006

First published in Great Britain, with additional material, by Allen Lane 2006

Published in Penguin Books with further additional material 2007

2

Copyright © Greg Palast, 2006, 2007

All righrs reserved

The moral right of the author has been asserted

Portions of this book have appeared in some form in Harper’s magazine, the Guardian and Observer newspapers, The Nation, In These Times, Lobster, TomPaine.com, alternet.org and Old Trout.

Except in the United States of America, this book is sold subject to the condition that it shall not, by way of trade or otherwise, be lent, re-sold, hired out, or otherwise circulated without the publishers prior consent in any form of binding or cover other than that in which it is published and without a similar condition including this condition being imposed on the subsequent purchaser

ISBN: 978-0-14-196364-8

To Gil and Gladys Palast. The originals.

CONTENTS

THE BEGINNING
“Like the Cowardly Dog He Was”

CHAPTER 1

THE FEAR

Who’s Afraid of Osama Wolf?

Including Marines in a tube, learning to speak Terrorist, Bush’s Khan job, National Security Document 199-I and Osama’s Mission Accomplished. What are you afraid of? Our Fear Salesman-in-Chief has some-thingfor everyone.

CHAPTER 2

THE FLOW

Trillion Dollar Babies

A five-and-a-half-part tale including Nose-Twist’s Hidden Hand, Kissingers man in the dream palace, the No-Brainer vs. The Witches’ Brew, the Other Downing Street memo, the Houston Insurgency, Amy’s alligator boots, Mr. 5%, a call to Riyadh, Wolfowitz Dāmmerung and “especially the oil.”

CHAPTER 3

THE NETWORK

The World as a Company Town

The holistic system of systems, petro-dollars, electro-dollars, the assassination of Hugo Chávez, Euro-nations, Mundell’s Toilet and coming down from Hubbert’s Peak. Mr. Friedman tees off.

CHAPTER 4

THE CON

Kerry Won. Now Get Over It…

… because they’re putting ’08 in their pocket. Republicans just seem to have that winning spirit. They also have caging lists, felons of the future, rotting ballots, snuffed canaries, and a lock on the votes of Kissinger-Americans and the undead.

CHAPTER 5

THE CLASS WAR

Hope I Die Before My Next Refill

Dispatches from the war of the movers and shakers against the moved and shaken, including No Child’s Behind Left, the Grinch That Stole Overtime and the Chdvez of Louisiana. Welcome to 1927.

THE END

The House I Live In

NEW ADDED BONUS CHAPTER!

BUSTED

… and How to Steal Back Your Vote

New to this edition. First, the untold story of how the White House drowned New Orleans—and why Homeland Security charged our merry team of investigators as terrorists. Then, how they’ll steal your vote in 2008—and how to steal it back.

Insurgency USA—Join Today!

Acknowledgments, Sources, and Resources

Index

Illustration Credits

The Armed Madhouse Soundtrack

THE BEGINNING

“Like the Cowardly Dog He Was”

President Jeb Bush declared his reelection victory early, in August, before the machines were fully programmed, but the results were nevertheless assured. President Jeb accepted a call from “Hillary Kerry Gore”— the virtual candidate, put up as quadrennial opponent, designed to lose—who always made the same moving concession speech, “American democracy has triumphed again,” written for her by Karl Rove. The official voting won’t take place until November.

“Our nation,” Vice-President Kate Harris assures us, “is safer and more prosperous than at any time in our history.”

But there are dissenters from this happy new America—shivering in their basements: Michaelites with their icons of St. Moore. The film-director/holy man was martyred when, through a rapid expansion caused by self-righteousness and fried food, he simply exploded onstage at the 2011 Cannes Film Festival, a fitting end given his final film, I Hate the Bushes So Much I Could Explode!

There are few complaints, certainly none expressed openly after the Health Insurance Riots of 2009 when the last licensed union members were “removed” to Guantanamo. “Orange Suit City” is now America’s eighth largest metropolis, “safer and more prosperous than ever.”

Still, every morning, the Rio Grande chokes with swarms of obese, illiterate Texans wading across to their 70-cents-an-hour jobs in the maquiladoras of Juarez.

Now, more than ever, America is the Lord’s land. Wal-Mart super-mega stores have metastasized into monumental “Retail Cathedrals” where true believers in cheap and disposable appliances come to pray and pay.

And we are well entertained. We have 11,000 TV channels, with every program chosen personally by Rupert Murdoch’s brain, now wired up in a pickle jar on the desk of Fox network president Roger Ailes. Tonight, Bill Clinton launches his fourth autobiography—with even more whoppers than the last three: “I was born in a log cabin mobile home”— “I did not sleep with that woman Hillary!”

The sovereign government of Iraq is still holed up, as it had been for the past decade, in the U.S. embassy in Baghdad. This week, Iraq’s President du Jour declared his own reelection victory. “Iraq is safer and more prosperous today than at any time in Iraqi history,” he said as mortar rounds whumped into the compound.

And back in the USA, after curfew, one can hear the screams and cries of the tots in the workhouses, locked behind the menacing signs, NO CHILD’S BEHIND LEFT.

Democracy flourishes. Yesterday, President bin Laden of Eurasia also reelected himself and received a congratulatory phone call from President Bush. “How long can we keep this up?” whispered Osama. Our President replied, “Just as long as the boobs and rednecks and berserkers and believers stay whipped up and angry… forever and ever, pardner.”

Nameless barbarians will assassinate the President tomorrow. Or will appear to. It’s all in the plan, where made-for-TV dramas and news are switched as needed to titillate the numbed public. “President Bush died like the cowardly dog he was,” the “terrorists” will say… and another Bush will replace him vowing to fight the unseen enemy in a war without end nor hope of an end.

If my report from the future gives you the creeps, the present ain’t a joyride either. The day before I wrote this, Carlos Arredondo, forty-four, of Hollywood, Florida, attacked a military van first with a sledgehammer and then set it and himself on fire. For twenty minutes he had repeatedly pleaded for the three harbingers of death to leave his home after they had delivered the news that his son was dead in Iraq. A total of 26% of his body was burned as the three Marines, the casualty assistance team, looked on. Neighbors said Arrendondo went crazy. I don’t think so. I think he went sane.

What’s insane is a regime that grants no asylum from militarized greed, whose sole saving grace is its incompetence: If they knew what they were doing, it would be worse. Arredondo put into action the wisdom of my late teacher, Allen Ginsberg: The soul, he wrote, should not die ungodly in an armed madhouse.

Loo Reading

Before I took up journalism just a few years ago, I worked for a living. I was an investigator, a “forensic economist.” Like the forensic pathologists on TV, I sliced into cadavers for evidence of fraud, racketeering and conspiracy; but in my case I cut into the bodies of companies; Exxon and Enron were two of them.¹ My idea had been to apply those old-style gumshoe techniques to reporting. The results can be viewed by most of the planet on my broadcasts for BBC Television’s Newsnight. In the USA, these investigative reports have appeared on Channel Nothing, thereby maintaining America’s news virginity inviolate.

I like to read in the loo, so this book, like my last, can be read in short spurts, in any order. To that end, I’ve eliminated the consistency and continuity that I despise in other books. Nevertheless, be aware of the chronological arc. We move from September 11, 2001 (The Fear), to fear’s foreign outing in the oil fields of Iraq (The Flow), to the widening global economic conflict (The Network), to the concomitant need to manipulate the elections of 2004 and 2008 (The Con), concluding with the drowning of New Orleans, the Gettysburg of The Class War.

Chapter One. In most wars, strategic intelligence is the key. For the Bush Administration, the key is strategic stupidity. As the FBI told us when we found their confidential bin Laden files, there are certain things the public “ought not to know.” Chapter One, The Fear, tells you a bit of what you are not supposed to know, from the pre—September 11 investigations of terrorists spiked by the FBI, to the writings of Osama bin Laden, to health insurance in America. In other words, it’s the chapter with the most laughs.

Chapter Two. Then it’s war. Conspiracy theorists believe George Bush, long before the invasion of Iraq, had a plan to control its oil. That’s wrong. He had two plans and my investigative team obtained both. The conflict between these two plans is what has kept our soldiers pinned down on the Tigris. The war is about the oil, for certain—not to get it for our SUVs, but to prevent us from getting it. The war is not about bringing down Saddam but about lifting up OPEC. In The Flow, we discover that the real insurgents come from Houston.

Chapter Three. Class war goes global. Three decades ago, I co-authored a book, The World as a Company Town, on a new phenomenon, “globalization.” Hardly anyone noticed, except for a malevolent, dwarfish gnome who had seized control of the economics department of the University of Chicago. Milton Friedman, rather than recoil at my warnings, thought a future world of multinational mega-corporations kicking down national boundaries and dictating their terms to hapless, helpless democracies would be really cool. Today, Friedman has grown a foot taller, glued on a lopsided moustache, and under the name “Thomas,” this newly morphed Friedman writes hosannas to the brave new free-trade horror show, most recently in a book, The World Is Flat. Chapter Three answers Milton Thomas Friedman by way of the movie The Network.

Chapter Four. In November 2000, for the London Observer newspaper, I revealed that, five months before the presidential election, Florida’s Governor Jeb Bush and his Secretary of State Katherine Harris had ordered the purge of 57,000 citizens from Florida’s voter rolls, supposedly convicts barred from voting. Most were Black, almost all innocent of any crime except VWB, Voting While Black. The faux-felon purge gave Jeb’s brother George Bush the presidency. Now, there’s no sense stealing the White House if you have to give it back four years later. To prevent the voters from interfering with the outcome, something extraordinary occurred in the 2004 presidential election: three and a half million ballots were cast but never counted. And guess whose votes didn’t count? Chapter Four, The Con, is the story of confidential Republican party “caging lists” that made their way to BBC, of empty ballot boxes in New Mexico and George Bush’s plurality among the undead. It doesn’t give away anything to tell you: Kerry won. More important is how the 2008 race will begin with a one-million-vote head start for the Republican candidate for president before a single ballot is officially cast.

Chapter Five. Sometimes, the ranks of the loser class must be thinned. Most of those drowned in the New Orleans flood of 2005 lived near the shorter levees along Lake Pontchartrain. The lower your income, the lower your sea barriers… and the lower your trade barriers. Chapter Five, The Class War, is about the death of General Motors, the rise of China and what that means for your Social Security and social insecurity. The president is solving the problem. Unfortunately, he’s the President of Venezuela.

New Afterword: Busted. After Armed Madhouse hit the streets in 2006, I thought the story was complete. But, later in the year, in tracking down some hoary new info in New Orleans, my film crew was charged by the Department of Homeland Security with violating anti-terror laws. Beyond the fun tale of how our terror-busters ended up capturing me instead of Osama, I’ve added here un-fun revelation of exactly how the White House let New Orleans down.

Then, the 2006 midterm elections, despite the election of a Democratic majority to Congress, exposed how the GOP has already locked up the race for 2008 with imaginative new ballot-box shenanigans. Because I don’t want to end on an angry note, this new chapter explains now only how they’ll steal your vote but how you can steal it back.

Everyone wants to write an immortal book, one that transcends time. This isn’t it. Hopefully. Everything you will read here—about stolen elections, stolen countries, stolen dignity and lives—will, knock wood, be forgotten in the new American Elysium, the Eden of Democracy that awaits us in the future. More likely, the book will be confiscated under Patriot Act VII.

Here’s what you will get between the covers: news not allowed on your nightly tube, old-fashioned gumshoe investigative reports for BBC Television’s Newsnight, where my stories are exiled to safety in London, and a few reports expanded from those journalistic safehouses, Harper’s magazine, Britain’s Guardian papers, and several seditious Web sites.

Think of these chapters as a way to count backward from ten: At the end, you can snap your fingers and wake up; the spell is broken, the hypnotic narcosis of America’s Fox-ified news is gone.

Before you enter these pages, I should warn you: I am not a nice man. Ask Alan Colmes, Fox’s house Liberal. He once said to me, “Greg, you have no respect for the office of the President.” No, I don’t. Not one iota. But I’m not prejudiced: It’s not just Oval Office residents who make me gag, it’s holders of offices in state capitols, in corporate towers and in a few churches too.

You want something heartwarming, Alan? Buy a puppy. But if you want just the facts, ma’am—facts rarely cuddly or cute—here’s your book.