Bush's Lap Dogs:

ABUSES IN IRAQ WERE ALSO covered up by Joseph Schmitz, who served as Bush's inspector general at the Pentagon. What Schmitz lacked in relevant training to monitor the Defense Department's $400 billion budget — "I am neither an accountant nor an auditor by background," he admitted to Congress — he more than made up for with his political pedigree. The son of a former GOP congressman, Schmitz worked for both Ronald Reagan and Newt Gingrich, and his brother served as a deputy counsel to George H.W. Bush and as a "pioneer" fund-raiser for George W. Bush.

Schmitz served Bush well as inspector general. In the wake of Abu Ghraib, he declared — without any formal investigation — that the scandal was the work of "bad eggs" in the junior ranks, not a direct result of the interrogation techniques approved by the president. He also turned a blind eye to war profiteering by contractors like Halliburton and Blackwater. "I haven't seen any real deliberate gouging of the American taxpayer," he said in 2004. "But we are looking." Not very hard, apparently: Schmitz sent only a single auditor to Iraq, and then quietly called him home in 2003 after just three months on the job.

According to those who worked with him, Schmitz spent much of his time as inspector general obsessively researching the history of Baron Friedrich von Steuben, George Washington's inspector general for the Continental Army. He also devoted three months to personally redesigning the inspector general's official seal to incorporate von Steuben's family motto: "Always under the protection of the Almighty."

But Schmitz always made time to shield administration officials from criminal investigation and congressional oversight. In 2004, according to Congressional documents, Schmitz blocked an inquiry by his own staff into John Shaw, an undersecretary to Donald Rumsfeld who was suspected of steering a lucrative Iraqi contract to an associate. Distrust in the IG's office grew so intense that Schmitz's senior staffers reportedly used code names for officials they were investigating so that their boss wouldn't torpedo their efforts. In a report to Congress, Schmitz also omitted testimony by Rumsfeld and Paul Wolfowitz and blacked out the names of White House officials suspected of colluding with Boeing on a fraudulent deal that would have cost taxpayers $5 billion.

Under fire for withholding evidence from Congress to shield the very officials he was supposed to be investigating — as well as for spending more than $100,000 in public funds on a ceremony honoring von Steuben — Schmitz resigned in 2005. He soon found a more comfortable home, however, at the helm of one of the shady contractors he had failed to properly oversee. He is now chief operating officer of the Prince Group, parent company to the mercenary security force Blackwater USA.

His replacement, Lt. Gen. Claude "Mick" Kicklighter, isn't likely to be any tougher on fraud and waste in the administration. A Rumsfeld and Wolf- owitz loyalist, Kicklighter previously served in an administration post that has become virtually synonymous with fraud and waste: The general was in charge of transforming the Coalition Provisional Authority in its final days into the U.S. Embassy in Baghdad.

A FEW INSPECTORS — NEARLY all of them holdovers from the Clinton administration — continued to do their jobs. Nikki Tinsley of the Environmental Protection Agency revealed that the White House actively misled residents of Lower Manhattan about toxic dangers after September 11th. Earl Devaney of the Interior Department worked tirelessly to bring down Steven Griles, the former deputy secretary now imprisoned for his complicity in the Jack Abramoff scandal. And Glenn Fine of the Justice Department exposed the FBI's illegal abuse of the Patriot Act to spy on average Americans. "A lot of the trouble for Alberto Gonzales came out of the work the inspector general did," says Rep. Miller. "It's the perfect example of why we need competent, tough, independent IGs."

To squelch such independence, the president has turned to his ultimate loyalist, Clay Johnson III — his prep-school pal from Andover and roommate at Yale. As a top official at the White House Office of Management and Budget, Johnson has made no secret that the administration expects inspectors to be seen and not heard. Testifying before Congress, he asserted that the "proper relationship" of the IGs is "to work together" with the agency heads they are supposed to monitor. Johnson also disparaged aggressive IGs like the Clinton holdovers, calling them "junkyard dogs."

To keep the inspectors in line, Johnson has browbeaten them into signing what amounts to a loyalty oath. According to Ervin, the former inspector for Homeland Security, Johnson held a meeting with the IGs and demanded that each of them sign a series of "principles" promising to work "in partnership" with their cabinet secretaries. "Clearly, the intent was to intimidate people," says Ervin, who refused to sign and was soon out of a job. Ervin's replacement, Richard Skinner — who had previously done a heck of a job as the acting inspector general of FEMA — now prints Johnson's loyalty principles at the front of his semiannual reports to Congress.

No inspector general has been more criticized for his lack of independent oversight than Robert "Moose" Cobb, who served as associate White House counsel under Alberto Gonzales before being appointed inspector general of NASA in 2002. According to a report by the President's Council on Integrity and Efficiency, an office run by fellow IGs to police the work of their peers, Cobb helped cover up the theft of nearly $2 billion in rocket-engine data from NASA's servers. The council also found that Cobb had tipped off Sean O'Keefe, the head of NASA, to impending FBI search warrants, and sought O'Keefe's input on how he should structure his "independent" audits.

Cobb wasn't nearly so considerate of those under him: According to the council, he berated subordinates as "knuckle-draggers" and "fucksticks," causing more than half of his staff to quit. As his own hand-picked assistant testified before Congress, "Mr. Cobb's arrogance, his abusive, bullying style, absence of managerial experience, limited understanding of investigative processes, egotism and misplaced sense of self-importance make it impossible for him to successfully manage and lead an organization."

The president's council concluded that Cobb should be subject to discipline "up to and including removal." But Clay Johnson left Cobb's punishment up to NASA administrator Michael Griffin, who asked only that Cobb work with an "executive coach" to further his "professional growth."

Such ineptitude and blind loyalty have implications far beyond the hurt feelings of disgruntled staffers. NASA, which funds much of the government's research into global warming, has been accused of trying to silence agency scientists like James Hansen, who warn that the world has less than a decade to forestall a climate catastrophe. "I would like an independent NASA watchdog investigating whether government scientists are free to research climate change," says Miller, oversight chair of the House science committee.

Now that the Democrats have regained control of Congress, they are seeking to restore a measure of independence to the inspectors general. Under a bill passed by the House on October 3rd, IGs — who now serve strictly at the pleasure of the president — would be given seven-year terms and could be fired only for cause. "The government needs more junkyard dogs," says Sen. Grassley, a Republican veteran of six administrations. But even if the current bill becomes law, Grassley notes, real oversight won't happen without change at the top to encourage honesty from below. "Whistle-blowers are the essence of IGs doing their job," he says. "The government is too big — you don't know where the skeletons are buried, you don't know where the fraud is being committed. You've gotta have leads, and the leads come from whistle-blowers. We need a president who will hold a Rose Garden ceremony honoring these people. Everyone from the top of the federal bureaucracy down to the janitor needs to know that whistle-blowers are patriots — and not the skunks at a picnic."