"What I've experienced in the last six months is the ugly side of the American dream."

Last month, David Iglesias and I were looking out at the Statue of Liberty and Ellis Island where his dad had entered the US from Panama decades ago.  It was a hard moment for the military lawyer who, immediately after Attorney General Alberto Gonzales fired Iglesias as US Attorney for New Mexico, returned to active military duty as a Naval Reserve JAG.

Captain Iglesias, cool and circumspect, added something I didn't expect:

"They misjudged my character, I mean they really thought I was just going to roll over and give them what they wanted and when I didn't, that I'd go away quietly but I just couldn't do that. You know US Attorneys and the Justice Department have a history of not taking into consideration partisan politics. That should not be a factor. And what they tried to do is just wrong and illegal and unethical."  

When a federal prosecutor says something is illegal, it's not just small talk.  And the illegality wasn't small.  It's called, "obstruction of justice," and it's a felony crime.

Specifically, Attorney General Gonzales, Iglesias told me, wanted him to bring what the prosecutor called "bogus voter fraud" cases.  In effect, US Attorney Iglesias was under pressure from the boss to charge citizens with crimes they didn't commit.  Saddam did that.  Stalin did that.  But Iglesias would NOT do that - even at the behest of the Attorney General.  Today, Captain Iglesias, reached by phone, told me, "I'm not going to file any bogus prosecutions."

But it wasn't just Gonzales whose acts were "unethical, wrong and illegal."

It was Gonzales' boss.

Iglesias says, "The evidence shows right now, is that [Republican Senator Pete] Domenici complained directly to President Bush. And that Bush then called Alberto Gonzales, the Attorney General, and complained about my alleged lack of vigorous enforcement of voter fraud laws."

In other words, it went to the top.  The Decider had decided to punish a prosecutor who wouldn't prosecute innocents.

All day long I've heard Democrats dance with glee that they now have the scalp of Alberto Gonzales.  They nailed the puppet.  But what about the puppeteer?

The question that remains is the same that Watergate prosecutors asked of Richard Nixon, "What did the President know and when did he know it?"

Or, to update it for Dubya, "What did the President know and how many times did Karl Rove have to explain it to him?"

During the Watergate hearings, Nixon tried to obstruct the investigation into his obstruction of justice by offering up the heads of his Attorney General and other officials.  Then, Congress refused to swallow the Nixon bait.  The only resignation that counted was the one by the capo di capi of the criminal-political cabal:  Nixon's.  The President's.

But in this case, even the exit of the Decider-in-Chief would not be the end of it.  Because this isn't about finagling with the power of prosecutors, it's about the 2008 election.

"This voter fraud thing is the bogey man," says Iglesias.

In New Mexico, the 2004 announcement of Iglesias' pending prosecution of voters (which he ultimately refused to do) put the chill on the turnout of Hispanic citizens already harassed by officialdom.  The bogus "vote fraud" hysteria helped sell New Mexico's legislature on the Republican plan to require citizenship IDs to vote - all to stop "fraudulent" voters that simply don't exist.

The voter witch-hunt worked.  "Wrong" or "insufficient" ID was used to knock out the civil rights of over a quarter million voters in 2004.  In New Mexico, that was enough to swing the state George Bush by a mere 5,900 votes.

So what is most frightening is not the resignation of Alberto Gonzales, the Pinocchio of prosecutorial misconduct, but the resignation of Karl Rove.  Because New Mexico 2004 was just the testing ground for the roll-out of the "ID" attack planned for 2008.

And Rove who three decades ago cut his political fangs as chief of the Nixon Youth, is ready to roll.  To say Rove left his White House job under a cloud is nonsense.  He just went into free-agent status, an electoral hitman ready to jump on the next GOP nominee's black-ops squad.  The fact that Rove's venomous assistant, Tim Griffin, was set up to work for the campaign Fred Thompson, is a sign that the Lord Voldemort of vote suppression is preparing to practice his Dark Arts in '08.

It was Rove who convinced Bush to fire upright prosecutors and replace them with Rove-bots ready to strike out at fraudulent (i.e. Democratic) voters.

Iglesias, however, remains the optimist.  "I'm hopeful that I'll get back to the American dream.  And get out of the American nightmare."

Dreams.  Nightmares.  I have a better idea for America:  Wake up.

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Greg Palast is the author of Armed Madhouse:  From Baghdad to New Orleans - Sordid Secrets and Strange Tales of a White House Gone Wild