In my last column, I tried to deflate expectations a bit about the likely consequences of the work of Special Counsel Patrick Fitzgerald; to bring them down to the realistic level at which he was likely to proceed. I warned, for instance, that there might not be any indictments, and Fitzgerald might close up shop as the last days of the grand jury's term elapsed. And I was certain he would only indict if he had a patently clear case.

Now, however, one indictment has been issued -- naming Vice President Cheney's Chief of Staff Lewis "Scooter" Libby as the defendant, and charging false statements, perjury and obstruction of justice. If the indictment is to be believed, the case against Libby is, indeed, a clear one.

Having read the indictment against Libby, I am inclined to believe more will be issued. In fact, I will be stunned if no one else is indicted.

Indeed, when one studies the indictment, and carefully reads the transcript of the press conference, it appears Libby's saga may be only Act Two in a three-act play. And in my view, the person who should be tossing and turning at night, in anticipation of the last act, is the Vice President of the United States, Richard B. Cheney.

The Indictment: Invoking the Espionage Act Unnecessarily

Typically, federal criminal indictments are absolutely bare bones. Just enough to inform a defendant of the charges against him.

For example, the United States Attorney's Manual, which Fitzgerald said he was following, notes that under the Sixth Amendment an accused must "be informed of the nature and cause of the accusation." And Rule 7(c)(1) of the Federal Rules of Criminal Procedure requires that, "The indictment . . . be a plain, concise and definite written statement of the essential facts constituting the offense charged." That is all.

Federal prosecutors excel at these "plain, concise and definite" statement indictments - drawing on form books and institutional experience in drafting them. Thus, the typical federal indictment is the quintessence of pith: as short and to the point as the circumstances will permit.

Again, Libby is charged with having perjured himself, made false statements, and obstructed justice by lying to FBI agents and the grand jury. A bare-bones indictment would address only these alleged crimes.

But this indictment went much further - delving into a statute under which Libby is not charged.

Count One, paragraph 1(b) is particularly revealing. Its first sentence establishes that Libby had security clearances giving him access to classified information. Then 1(b) goes on to state: "As a person with such clearances, LIBBY was obligated by applicable laws and regulations, including Title 18, United States Code, Section 793, and Executive Order 12958 (as modified by Executive Order13292), not to disclose classified information to persons not authorized to receive such information, and otherwise to exercise proper care to safeguard classified information against unauthorized disclosure." (The section also goes on to stress that Libby executed, on January 23, 2001, an agreement indicating understanding that he was receiving classified information, the disclosure of which could bring penalties.)

What is Title 18, United States Code, Section 793? It's the Espionage Act -- a broad, longstanding part of the criminal code.

The Espionage Act criminalizes, among other things, the willful - or grossly negligent -- communication of national-defense related information that "the possessor has reason to believe could be used to the injury of the United States or to the advantage of any foreign nation." It also criminalizes conspiring to violate this anti-disclosure provision

But Libby isn't charged with espionage. He's charged with lying to our government and thereby obstructing justice. So what's going on? Why is Fitzgerald referencing the Espionage Act?

The press conference added some clarity on this point.

Libby's Obstruction Has Blocked An Espionage Act Charge

The Special Counsel was asked, "If Mr. Libby had testified truthfully, would he be being charged in this crime today?" His response was more oblique than most.

In answering, he pointed out that "if national defense information which is involved because [of Plame's] affiliation with the CIA, whether or not she was covert, was classified, if that was intentionally transmitted, that would violate the statute known as Section 793, which is the Espionage Act." (Emphasis added). (As noted above, gross negligence would also suffice.)

But, as Fitzgerald also noted at his press conference, great care needs to be taken in applying the Espionage Act: "So there are people," he said, "who argue that you should never use that statute because it would become like the [British] Official Secrets Act. I don't buy that theory, but I do know you should be very careful in applying that law because there are a lot of interests that could be implicated in making sure that you picked the right case to charge that statute."

His further example was also revealing. "Let's not presume that Mr. Libby is guilty. But let's assume, for the moment, that the allegations in the indictment are true. If that is true, you cannot figure out the right judgment to make, whether or not you should charge someone with a serious national security crime or walk away from it or recommend any other course of action, if you don't know the truth.... If he had told the truth, we would have made the judgment based upon those facts...." (Emphases added.)

Finally, he added. "We have not charged him with [that] crime. I'm not making an allegation that he violated [the Espionage Act]. What I'm simply saying is one of the harms in obstruction is that you don't have a clear view of what should be done. And that's why people ought to walk in, go into the grand jury, you're going to take an oath, tell us the who, what, when, where and why -- straight." (Emphasis added)

In short, because Libby has lied, and apparently stuck to his lie, Fitzgerald is unable to build a case against him or anyone else under Section 793, a provision which he is willing to invoke, albeit with care.

And who is most vulnerable under the Espionage Act? Dick Cheney - as I will explain.

Libby Is The Firewall Protecting Vice President Cheney

The Libby indictment asserts that "[o]n or about June 12, 2003 Libby was advised by the Vice President of the United States that Wilson's wife worked at the Central Intelligence Agency in the Counterproliferation Division. Libby understood that the Vice President had learned this information from the CIA."

In short, Cheney provided the classified information to Libby - who then told the press. Anyone who works in national security matters knows that the Counterproliferation Division is part of the Directorate of Operations -- the covert side of the CIA, where most everything and everyone are classified.

According to Fitzgerald, Libby admits he learned the information from Cheney at the time specified in the indictment. But, according to Fitzgerald, Libby also maintained - in speaking to both FBI agents and the grand jury - that Cheney's disclosure played no role whatsoever in Libby's disclosure to the media.

Or as Fitzgerald noted at his press conference, Libby said, "he had learned from the vice president earlier in June 2003 information about Wilson's wife, but he had forgotten it, and that when he learned the information from [the reporter] Mr. [Tim] Russert during this phone call he learned it as if it were new."

So, in Fitzgerald's words, Libby's story was that when Libby "passed the information on to reporters Cooper and Miller late in the week, he passed it on thinking it was just information he received from reporters; that he told reporters that, in fact, he didn't even know if it were true. He was just passing gossip from one reporter to another at the long end of a chain of phone calls."

This story is, of course, a lie, but it was a clever one on Libby's part.

It protects Cheney because it suggests that Cheney's disclosure to Libby was causally separate from Libby's later, potentially Espionage-Act-violating disclosure to the press. Thus, it also denies any possible conspiracy between Cheney and Libby.

And it protects Libby himself - by suggesting that since he believed he was getting information from reporters, not indirectly from the CIA, he may not have had have the state of mind necessary to violate the Espionage Act.

Thus, from the outset of the investigation, Libby has been Dick Cheney's firewall. And it appears that Fitzgerald is actively trying to penetrate that firewall.

What Is Likely To Occur Next?

It has been reported that Libby's attorney tried to work out a plea deal. But Fitzgerald insisted on jail time, so Libby refused to make a deal. It appears that only Libby, in addition to Cheney, knows what Cheney knew, and when he knew, and why he knew, and what he did with his knowledge.

Fitzgerald has clearly thrown a stacked indictment at Libby, laying it on him as heavy as the law and propriety permits. He has taken one continuous false statement, out of several hours of interrogation, and made it into a five-count indictment. It appears he is trying to flip Libby - that is, to get him to testify against Cheney -- and not without good reason. Cheney is the big fish in this case.

Will Libby flip? Unlikely. Neither Cheney nor Libby (I believe) will be so foolish as to crack a deal. And Libby probably (and no doubt correctly) assumes that Cheney - a former boss with whom he has a close relationship -- will (at the right time and place) help Libby out, either with a pardon or financially, if necessary. Libby's goal, meanwhile, will be to stall going to trial as long as possible, so as not to hurt Republicans' showing in the 2006 elections.

So if Libby can take the heat for a time, he and his former boss (and friend) may get through this. But should Republicans lose control of the Senate (where they are blocking all oversight of this administration), I predict Cheney will resign "for health reasons."

Commentary:
One thing puzzled me throughout the investigation. Fitzgerald allowed Rove (and others) to come back to the Grand Jury repeatedly so they could correct the record ("tell the truth, the whole truth and nothing but the truth."). Why would he do that? According to press reports, Rove told the Grand Jury the media told him about Ms. Wilson which wasn't true. Just before the indictments were handed down Rove changed his story and Fitzgerald let him go. Why would he do that?

Dean makes a compelling argument. It's plausible he's letting Rove (and others) off because he's after Cheney. It's the only logical argument I've heard so far.