GOP fury after report claims IRS 'recycled' Lerner hard drive

The top Republican on one of the House committees investigating the IRS targeting scandal reacted furiously late Wednesday to a report that ex-IRS official Lois Lerner's hard drive had been recycled, making it likely that many emails sent to and from Lerner prior to the summer of 2011 will never be recovered. 

The Politico report cited two anonymous sources, as well as Sen. Orrin Hatch, R-Utah, who confirmed that the Senate Finance Committee had been told that the hard drive had been discarded.

"If the IRS truly got rid of evidence in a way that violated the Federal Records Act and ensured the FBI never got a crack at recovering files from an official claiming a Fifth Amendment protection against self-incrimination, this is proof their whole line about 'losing' e-mails in the targeting scandal was just one more attempted deception," House Oversight and Government Reform Committee chairman Darrell Issa, R-Calif., said in a statement. "Official records, like the e-mails of a prominent official, don't just disappear without a trace unless that was the intention."

Lerner headed the IRS division that processed applications for tax-exempt status. The IRS acknowledged last year that agents had improperly scrutinized applications for tax-exempt status by Tea Party and other conservative groups.

Congressional investigators have been probing the agency for more than a year. However, IRS officials did not inform Congress of the lost emails until June 13.

Republicans on the House Ways and Means Committee have charged that the agency knew as early as February that the emails were missing. They have also said that email records of six IRS employees believed to be involved in the scandal in addition to Lerner have not been found. 

The missing emails are mainly messages to and from people outside the IRS, including the White House and other major offices and departments.

The IRS was able to recover 24,000 Lerner emails from 2009 to 2011 because Lerner had copied in other IRS employees. The agency said it pieced together the emails from the computers of 83 other IRS employees.

Poll finds faith in Congress at historic single-digit low

Americans' confidence in Congress has never been so low. 

A new Gallup survey finds just 7 percent of Americans have a high level of confidence in Capitol Hill -- that's low even by congressional standards. 

Not only is the figure the lowest since Gallup started asking the question in 1973, but it's the lowest for any U.S. institution on record. 

About a third of Americans reported having "some" confidence in Congress. But just 7 percent reported having a "great deal" and "quite a lot." 

Compare that with public sentiment toward the military (three in four Americans have high confidence) or small business (62 percent have high confidence). 

Faith in Congress is taking a body blow after a stretch where the public has perceived the institution as doing very little, gripped by partisan gridlock and struggling to pass even routine measures. 

The poll of 1,027 adults was conducted June 5-8, and had a margin of error of 4 percentage points.

Sources: Benghazi attack suspect captured, en route to US

EXCLUSIVE: A suspected terrorist linked to the 2012 Benghazi terror attack that killed four Americans has been captured inside Libya by U.S. forces and currently is en route to the United States, Fox News has learned. 

Sources told Fox News that the suspect, Ansar al-Sharia commander Ahmed Abu Khattala, was captured Sunday during a joint U.S. military and law enforcement operation, and will face prosecution in the United States. 

President Obama signed off on the mission on Friday night, Fox News is told. Khattala was captured south of Benghazi by U.S. special operators and is on his way to the U.S. aboard a Navy ship. 

Khattala was long thought to be one of the ringleaders of the deadly attack, in which U.S. Ambassador Chris Stevens and three other Americans died. He had openly granted media interviews since the 2012 attack, but until now evaded capture. 

The capture marks the first time the United States has caught one of the suspects in the 2012 assault. 

"He didn't know what hit him," one source told Fox News of the capture. According to sources, there was no firefight -- a small Special Forces team with one FBI agent took part in the mission. 

Pentagon Press Secretary Rear Adm. John Kirby confirmed the capture in a brief statement late Tuesday morning, calling Khattala a "key figure in the attacks on U.S. facilities in Benghazi." 

Kirby said: "There were no civilian casualties related to this operation, and all U.S. personnel involved in the operation have safely departed Libya." 

White House Press Secretary Jay Carney called the development an "important milestone." 

The administration has faced sustained criticism from some in Congress and the families of the victims over the fact that no one had been brought to justice since that day in 2012. 

State Department official Sean Smith, and CIA contractors Tyrone Woods and Glen Doherty were also killed during the attack. 

ISIS moving seized US tanks, Humvees to Syria

Syrian and Iraqi terrorist forces obtained significant numbers of tanks, trucks, and U.S.-origin Humvees in recent military operations in Iraq and those arms are being shipped to al Qaeda rebels in Syria, according to U.S. officials.

U.S. intelligence agencies reported this week that photos of the equipment transfers were posted online by the Islamic State of Iraq and the Levant (ISIL), also known as ISIS, the ultra-violent terror group that broke away from al Qaeda but shares its goals and philosophy.

Pentagon spokesman Cmdr. Bill Speaks confirmed the weapons transfers and expressed concerns about the captured arms.

“We’re aware of reports of some equipment—namely Humvees—and the pictures that have been posted online,” Speaks said in an email. “We are certainly concerned about these reports and are consulting with the Iraqi government to obtain solid confirmation on what assets may have fallen into ISIL’s hands.”

Speaks added that the loss of the equipment to the terrorist group is “really a matter for the Iraqi government to speak to publicly” because “it is their equipment.”

Exact numbers of captured arms and equipment are not known. The insurgents raided all the arms depots and vehicles belonging to Iraq’s Second Division, based in Mosul, which included a motorized brigade and several infantry brigades.

A defense official warned that ISIL claims that they have captured advanced weaponry, such as Blackhawk helicopters, are suspect.

“We do know that they made false claims last week, particularly with Blackhawk helicopters, which have never been sold to Iraq,” the official said.

Cantor upset in Virginia GOP primary by Tea Party backed challenger

House Majority Leader Eric Cantor lost his GOP Virginia primary race to Tea Party-backed challenger Dave Brat Tuesday night in a stunning upset.
Brat, an economics professor and political novice, latched onto the hot-button issue of immigration, accusing Cantor, the No. 2 Republican in the GOP-led House, of supporting immigration legislation that would give “amnesty” to millions of people living illegally in the United States.

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“If you go knocking door to door, you’ll know the American people think they’re in trouble,” Brat told Fox News. “It was a miracle. God gave us this win.”
Brat, a Princeton graduate and seminar student who teaches at Randolph-Macon College, a small liberal arts school north of Richmond, attempted to downplay the Tea Party vs. Washington establishment narrative about the race.
He said he enjoyed Tea Party support but was a candidate focused on Republican principles including free markets and “adherence to the Constitution.”
Cantor conceded defeat about an hour after the race was called, confirming the biggest upset victory of this year's election cycle and a major blow to the core of the GOP.
“It’s disappointing,” he told a small crowd in Richmond. “But I believe in this country. I believe there is opportunity around the next corner.”
Cantor also thanked volunteers, supporters and campaign staffers. And he called serving as the state’s 7th District congressman and as majority leader one of the highest honors of his life.
Brat won 56 percent of the vote, compared to 44 percent for Cantor, with all precincts reporting. Approximately 18,000 more votes were cast in Tuesday's primary than in 2012, when Cantor easily defeated another Tea Party-backed challenger, Floyd Bayne.
In the closing weeks of the race, Brat tried to tie the seven-term congressman’s support for legal status for children who have illegally entered the country to the situation of hundreds of children from Central America pouring illegally across the southern U.S. border, creating a humanitarian crisis.
Cantor, once considered next in line to take over for House Speaker John Boehner, R-Ohio, fought back in part by pointing out that he helped block Senate plans "to give illegal aliens amnesty."
Cantor and other House Republican leaders had advocated a more step-by-step approach to immigration reform that would in part begin with tighter border security, instead of the comprehensive bill backed by the Senate.
Brat also said Cantor, who was first elected in 2000 and has ties to Tea Party-backed lawmakers in Congress, had spent too much time in Washington and lost touch with the conservative base in his Richmond-area district.
Despite the attacks, Cantor had appeared well positioned for reelection.
The most recent campaign finance reports showed he spent more than $1 million in April and May but still has more than $1.5 million in the bank.
Brat, by contrast, raised just more than $200,000 for his campaign, according to the reports.
"Dollars don't vote, people do," he told Fox News.
Large corporations and other groups donated heavily to the incumbent.
The American Chemistry Council, whose members include many blue chip companies, spent more than $300,000 on TV ads promoting Cantor. And the political arms of the American College of Radiology, the National Rifle Association and the National Association of Realtors had five-figure independent spending to promote him.
Brat helped offset the cash disadvantage with endorsements from conservative activists, like radio host Laura Ingraham, and with help from Tea Party activists angry at Cantor.
The upset sent shock waves across Capitol Hill with speculation about whether Cantor would resign his leadership post and if any Republican incumbent would now dare to support immigration reform. Cantor aides did not respond Tuesday when asked if the 51-year-old would launch a write-in campaign in November.

“Eric Cantor and I have been through a lot together," Boehner said. "He’s a good friend and a great leader, and someone I’ve come to rely upon on a daily basis as we make the tough choices that come with governing. My thoughts are with him and (wife) Diana and their kids tonight.”

Soon after Cantor conceded, questions also began to arise about what the result means for Boehner's future as Speaker. The conventional wisdom is that Boehner has been strengthened by Cantor's defeat, as his strongest potential challenger for the Speaker's gavel has been removed. 

One former senior House Republican close to Boehner described Cantor's loss as "devastating to the party," before adding that it may not be to Boehner "as there is no one else now."
"We need Boehner now more than ever," said the former member. "Can Boehner step up?"

Democrats reveled in the loss.

"From Day One of (President) Obama’s presidency, Eric Cantor has used every dirty trick to block the Democratic agenda," the Democratic Congressional Campaign Committee said in a fundraising e-mail.

"Eric Cantor has long been the face of House Republicans' extreme policies, debilitating dysfunction and manufactured crises.  Tonight is a major victory for the tea party as they yet again pull the Republican Party further to the radical right," said House Minority Leader Nancy Pelosi, D-Calif. "As far as the midterm elections are concerned, it's a whole new ballgame."

Cantor, a former Virginia state legislator, was elected to Congress in 2000. He became majority leader in 2011.

The Brat victory was by far the biggest of the 2014 campaign season for Tea Party forces, though last week they forced veteran Mississippi Sen. Thad Cochran into a June 24 runoff with state Sen. Chris McDaniel.
"Thad Cochran, Eric Cantor. They were playing with fire," a source familiar with both campaigns told Fox News. "It will force the Republicans to move further to the right. ... You have what could be chaos for leadership. They could get caught up in the politics of this and that gets them away from any legislative agenda."
Cantor's defeat appears to be the first ever suffered in a primary by a sitting House majority leader. Former House Speaker Thomas Foley, D-Wash. and Senate Democratic leader Tom Daschle of South Dakota both lost their seats at the polls in 1994 and 2004, respectively, but they fell to Republicans, not to challengers from within their own parties.
Jay S. Poole, a Cantor volunteer, said Brat tapped into widespread frustration among voters about the gridlock in Washington and issues such as immigration.
"I can't tell you how amazing this is to me," Poole said.
In the fall, Brat will face Democrat Jack Trammel, also a professor at Randolph-Macon, in the solidly Republican district.

Hillary Clinton says family 'dead broke' after White House

Intelligence officials predicted two detainees in Bergdahl swap would return to senior Taliban positions, report claims

U.S. intelligence officials predicted that two of the detainees freed from Guantanamo Bay in exchange for the release of Army Sgt. Bowe Bergdahl from Taliban captivity would return to senior positions in the militant group, according to a published report. 
The Wall Street Journal reports that analysis was contained in a classified assessment prepared by spy agencies during deliberations about whether to agree to the prisoner exchange. The analysis also said that two others were likely to assume active roles within the Taliban. 
The intelligence assessment was reportedly described to select lawmakers during classified briefings about the prisoner swap given by the administration last week. The existence of the assessment is being revealed as Defense Secretary Chuck Hagel prepares to testify before the House Armed Services Committee about the prisoner exchange Wednesday. 
The five detainees are Mohammed Fazl, a former Taliban army chief of staff; Noorullah Noori, a former commander in northern Afghanistan; Khairullah Khairkhwa, a former interior minister; Mohammed Nabi Omari, another Taliban official; and Abdul Haq Wasiq, the deputy intelligence chief.
Of those five, a senior U.S. official tells the Journal that Fazl and Khairkhwa are likely to resume senior leadership roles, while Noori and Omari are expected to resume active roles. Wasiq is considered unlikely to resume an active role with the Taliban. According to documents obtained and released by the website Wikileaks, Wasiq had arranged to meet with U.S. forces to provide information about Taliban leader Mullah Mohammad Omar that could be used in attempting to capture him prior to Wasiq's detention in 2001.  
The Journal reports that one U.S. document says Wasiq was "resentful" that he was imprisoned while cooperating with the U.S. 
The Obama administration has defended the prisoner exchange on the grounds that Qatar, which took in the detainees, would allow the U.S. to monitor and track them. The Journal reports that Qatar has also agreed to offer a  "re-education program" designed to draw the five away from militancy. 
If that doesn't work, U.S. officials say, the administration would not hesitate to target the men should they attempt to return to the battlefield. 
As Pentagon spokesman Rear Adm. John Kirby put it, "They re-enter the fight at their own peril."

China billionaire eyes US market after snatching up taxpayer-backed Fisker

 Bailey: "Get use to it because this is just the beginning. The American Government started selling us out a long time ago!"


Fisker Automotive -- the U.S. electric car company that failed to repay roughly $139 million in federal loans before going bankrupt -- is now owned by a Chinese company eager to unleash its cut-rate acquisition on the American auto industry.
The company’s assets were acquired earlier this year by China's biggest auto parts supplier, Wanxiang Group, for $149.2 million in a U.S. bankruptcy auction.
The company reportedly could start selling Fisker’s ill-fated Karma plug-in car later this year in the United States and Europe.
Billionaire company founder and Chairman Lu Guanqiu has aspired to get into the auto industry since the 1980s and the electric-car business for roughly the past 15 years.
And the acquisition of Fisker and its battery supplier, A123 Systems, which each came with key patents, should make Guanqiu's company well positioned to compete.
Wanxiang acquired A123 Systems in a 2012 bankruptcy sale, after the company failed to repay millions to the same federal loan program that helped Fisker.
"I'll put every cent that Wanxiang earns into making electric vehicles,” Guanqiu, who outbid at least one other Chinese investor, told Bloomberg Businessweek this spring. "I'll burn as much cash as it takes to succeed, or until Wanxiang goes bust."
The remark reflects the opinion of industry experts who think Guanqiu’s determination and record of success could indeed make him a player in the market along with Toyota, whose Prius is the most popular hybrid sold in America.
Fisker received the taxpayer-funded millions through the Energy Department’s Advanced Technology Vehicles Manufacturing Loan Program, which has provided $8.4 billion in funding since 2009.
The program came under scrutiny after the department lost the roughly $139 million on Fisker, which filed for bankruptcy in 2013. Fisker received $192 million from the program before funding was pulled.
The situation resulted in criticism about the Obama administration’s eagerness to back “green-energy” projects like Fisker and failed solar panel company Solyndra, despite indications they could not compete in the marketplace.
The Energy Department also lost about $42 million on a loan to a shuttered Michigan company that made vans for the disabled. However, the loan program had success with electric car maker Tesla Motors Inc., which reportedly repaid its $452 million loan in 2013.
Critics have also complained that Guanqiu didn’t step in to save Fisker and U.S. taxpayers, instead waiting for the bankruptcy sale.
An Energy Department spokeswoman later told reporters: “While the outcome is not what we hoped for, the [agency] explored every option available and closely followed federal legal processes in an effort to get the best possible recovery for the taxpayer.”
Fisker in its five-year run also reportedly burned through roughly $1 billion in private investment money.
The Karma comes with a small gasoline engine that kicks in when the battery runs out of power. Fisker sold about 1,800 models from 2011 and 2012, at about $100,000 each, before a series of problems halted production.
Wanxiang also is reportedly considering completely the development of a second Fisker model -- a more affordable mid-sized, gas-electric hybrid named the Atlantic.
Right now, the new owner plans to produce the vehicles in Finland but reportedly is considering the potential for U.S. manufacturing.