President Bush’s approval rating, the “lowest mark of his presidency,” according to a new Wall Street Journal/Harris poll.

This morning, USA Today reported that three telecommunications companies – AT&T, Verizon and BellSouth – provided “phone call records of tens of millions of Americans” to the National Security Agency. Such conduct appears to be illegal and could make the telco firms liable for tens of billions of dollars. Here’s why:

1. It violates the Stored Communications Act. The Stored Communications Act, Section 2703(c), provides exactly five exceptions that would permit a phone company to disclose to the government the list of calls to or from a subscriber: (i) a warrant; (ii) a court order; (iii) the customer’s consent; (iv) for telemarketing enforcement; or (v) by “administrative subpoena.” The first four clearly don’t apply. As for administrative subpoenas, where a government agency asks for records without court approval, there is a simple answer – the NSA has no administrative subpoena authority, and it is the NSA that reportedly got the phone records.

2. The penalty for violating the Stored Communications Act is $1000 per individual violation. Section 2707 of the Stored Communications Act gives a private right of action to any telephone customer “aggrieved by any violation.” If the phone company acted with a “knowing or intentional state of mind,” then the customer wins actual harm, attorney’s fees, and “in no case shall a person entitled to recover receive less than the sum of $1,000.”

(The phone companies might say they didn’t “know” they were violating the law. But USA Today reports that Qwest’s lawyers knew about the legal risks, which are bright and clear in the statute book.)

3. The Foreign Intelligence Surveillance Act doesn’t get the telcos off the hook. According to USA Today, the NSA did not go to the FISA court to get a court order. And Qwest is quoted as saying that the Attorney General would not certify that the request was lawful under FISA. So FISA provides no defense for the phone companies, either.

In other words, for every 1 million Americans whose records were turned over to NSA, the telcos could be liable for $1 billion in penalties, plus attorneys fees. You do the math.

– Peter Swire and Judd Legum

UPDATE: Many of you had questions about this legal analysis. Peter provides the answers here. We’ll continue to address your questions as this story develops.

UPDATE II: Orrin Kerr agrees with our analysis in the New York Times:

Orin Kerr, a former federal prosecutor and assistant professor at George Washington University, said his reading of the relevant statutes put the phone companies at risk for at least $1,000 per person whose records they disclosed without a court order.

“This is not a happy day for the general counsels” of the phone companies, he said. “If you have a class action involving 10 million Americans, that’s 10 million times $1,000 “” that’s 10 billion.”

A special grand jury investigating Kentucky state government hiring practices “indicted Gov. Ernie Fletcher on three misdemeanors for conspiracy, official misconduct and political discrimination.” Fourteen other indictments are currently under seal, likely covering alleged crimes committed by Fletcher’s staff that occurred before Fletcher “pardoned all administration officials except himself.”

Criminally-indicted Rep. Tom DeLay (R-TX) writes House Speaker Dennis Hastert (R-IL): “I have recently made the decision to pursue new opportunities to engage in the important cultural and political battles of our day from an arena outside of the U.S. House of Representatives. As a result, I am informing you of my intention to formally resign as the representative of the 22nd Congressional District of Texas to be effective at the close of business on June 9, 2006.”

Alphonso Jackson’s story about canceling a government contract because the contractor criticized President Bush was part of a larger effort to “educate” influential minority business leaders about how things “work” in Washington. A new Dallas Business Journal story has more from his controversial April 28 speech:

Before joining the federal government, Jackson said, he was “na¯ve about how things worked in Washington.”

“After about six months on the job, I had a person come in and say, ‘I don’t think you understand how government works. We don’t bid out anything in government.’ I said, ‘What do you mean? That’s illegal.’ He went on about the lists people get on.

“A lot of blacks and Hispanics don’t know about the lists,” Jackson said. “I didn’t know about this. So we started this process where every time a businessperson of color came in to see me, I’d tell them, ‘Go down to the (minority small business) office and get registered — then I can work with you.

According to Jackson, once you are on the list and get a contract, the money never stops flowing:

Jackson also told the group about a contractor who started with a $50,000 HUD contract in 1992. About six months ago, Jackson said, the agency terminated the contract and redistributed the work to three smaller, disadvantaged firms.

“This is going to astound you,” he said. “When we terminated the contract it was worth $111 million. That’s how government works. Once you get the contract, they just keep giving you tax dollars.”

Jackson stressed that “HUD provides ‘business opportunities for many in this room to get rich,’” adding that “one contract can make you wealthy.” That was the purpose of the speech, to explain to a well-heeled crowd (including former Dallas Cowboys players Roger Staubach and Emmitt Smith) how to rake in cash from the federal government.

It’s not about providing a valuable service at a fair price. It’s about getting on the list, getting the money flowing and making sure you don’t criticize the President. Whether the details of Jackson’s speech were fact or fiction, it’s a grossly irresponsible message and a violation of the public trust.

The Wall Street Journal today reports that the major oil companies successfully “beat back” attempts by Congress to have oil companies pay their fair share in taxes:

Exxon Mobil Corp., Chevron Corp. and ConocoPhillips beat back an attempt by senators to raise their taxes by nearly $6 billion.

The Senate version of the bill at one point included a provision that would have cost the five largest oil companies — companies with average daily production of 500,000 barrels; gross receipts of more than $1 billion dollars in 2005 and an ownership in a refinery of 15% or more — about $5 billion by changing how they account for oil inventory. House Republicans dropped the provision from the final version of the bill.

A separate Senate measure would have stripped $700 million in tax incentives for large oil companies to explore for oil and gas. That provision, too, was dropped from the compromise bill that emerged from House-Senate negotiations.

Looks like Big Oil has been putting their record profits to good use.

PoliticalMoneyLine has a new analysis on how they’ve been spending their money. In 2005, the top ten oil companies spent a whopping $33,173,092 lobbying Congress and the Bush administration. The numbers are broken down by company below: Read more

Senate Judiciary Committee Chairman Arlen Specter (R-PA) has announced he would “call executives from the telephone companies to testify before Congress about the relationship with the NSA and what sort of data was provided.” Meanwhile, leading networks analyst Valdis Krebs called the program “a waste of time, a waste of resources. And it lets the real terrorists run free.”

find it newsworthy that a Bush cabinet member and his aide have offered contradictory statements to explain potentially illegal conduct.

President Bush spoke moments ago about a USA Today report on a massive NSA database that collects information about all phone calls made within the United States. Bush did not deny any of the contents of the article, but he did say:

First, our intelligence activities strictly target Al Qaeda and their known affiliates. Al Qaeda is our enemy, and we want to know their plans.

USA Today, 5/11/06:

The National Security Agency has been secretly collecting the phone call records of tens of millions of Americans, using data provided by AT&T, Verizon and BellSouth, people with direct knowledge of the arrangement told USA TODAY.

The NSA program reaches into homes and businesses across the nation by amassing information about the calls of ordinary Americans “” most of whom aren’t suspected of any crime.

Collecting information on “tens of millions of Americans” doesn’t seem very targeted.

to be chief financial officer for the Homeland Security Department is David Norquist. His credentials: at his previous job at the Pentagon, Norquist allowed Halliburton “to conceal alleged overcharges in an investigation by a United Nations oversight board.” TPM Muckraker has more.