National Security Agency officials listened to phone conversations between U.S. troops in Iraq and their loved ones, alleges a new book called The Shadow Factory by James Bamford.  The Washington Post’s Joby Warrick reports that Bamford interviewed two former NSA officials who said that eavesdroppers would abuse their privilege to monitor military personnel by pruriently listening to obviously non-security related exchanges.

Intelligence officials have denied the charges. The Senate Intelligence Committee may hold hearings into the matter. All in all, it’s not the greatest advertisement for giving extended surveillance powers to the NSA.-MB

After eight years of crisp, pro-active government (2-3 unending wars, a surplus turned into trillions of debt, an economy that gets more disastrous by the day, dormant regulatory agencies) probably a lot of people are worried that a Barack Obama or John McCain administration will not bring the same "execution" to the executive branch that the George W. Bush administration did. Well, the President hears you and yesterday he signed an executive order to create a transition council that will offer advice about how the next administration governs. White House Chief of Staff Josh Bolten– with time on his hands since he’s not cooperating with a Congressional subpoena to turn over documents on the U.S. Atty. firings– will head the council.

As the Washington Post’s Dan Eggen points out, the transition council has a dark humor to it beyond just the historic incompetence of the Bush administration. Bush did a specifically awful job in his first year attending to holes in the bureaucracy. Perhaps still exhausted from round-the-clock efforts to prevent a recount in Florida, the president took months to name heads of federal agencies. Among the mountain of problems this lead to, the 9/11 commission noted that a hallowed out national security apparatus damaged efforts to prevent the 9/11 attacks. So, yeah, maybe Obama or McCain should take the transition council’s advice with a grain of salt.-MB

So says the Wall Street Journal’s Damian Paletta, Carrick Mollenkamp and John D. McKinnon about the plan to guarantee billions in bank debt and insure all bank deposits. This new moves to stave off the ever-growing Wall Street fallout would likely be coordinated with Great Britain. The British, going through a crisis of their own, have already announced that the equivalent of $432 billion in bank debt would be guaranteed.

In order for the Federal Deposit Insurance Corporation to back government lending to banks, the FDIC would have to invoke a rarely used regulatory rule that admits the U.S. financial system is at "systemic risk."

A better article on backing up bank debt might come in a day or so after the White House has decided how much it will cooperate with the British plan. It is astonishing, though, to think that just last week the bailout law Congress passed was considered an unprecedented government intervention into the markets. Now the two-week bailout debate looks like just a chapter in the story of the federal government’s response.-MB