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I posted a story last week that showed how The Intercept was taken for a ride by the National Security Council (NSC) and National Security Agency (NSA), and used to plant a story attacking private contractors. The Intercept‘s story was co-bylined by Jeremy Scahill and Matthew Cole, the former ABC News reporter who has the distinction of putting not one but two whistleblowers — John Kiriakou and more recently Reality Winner — behind bars.

The story got some push back, probably because people seemed to think I was supporting private contractors and Erik Prince, who founded the company Blackwater. He was allegedly involved in a contractor project “to set up a large intelligence network and run counterterrorist propaganda efforts,” according to BuzzFeed, which ran a story that complemented The Intercept‘s piece.

Well, I stand by my story. Both outlets got played. And to be clear, I’ve criticized private military contracting for twenty years and am no fan, to put it mildly, of Erik Prince.

I detailed in my original piece how The Intercept employed surveillance, blackmail and other sleazy tactics routinely used by intelligence agencies in reporting its story. But the main point was that The Intercept‘s story was fundamentally flawed and its key assertions were inaccurate.

Matthew Cole. Note to confidential sources who talk to him: Prison food sucks.

I have a raft of new information below that further decimates Scahill and Cole’s fanciful tale, whose chief beneficiaries were Lockheed Martin, Boeing, Northrop Grumman and other private contractors that are already making billions of dollars on the disastrous wars in Afghanistan and Iraq. Those contractors — and the national security agencies that spoon fed the story to Scahill and Cole — are surely laughing at The Intercept, all the way to the bank.

Here’s The Intercept‘s lede:

The Trump administration is considering a set of proposals developed by Blackwater founder Erik Prince and a retired CIA officer — with assistance from Oliver North, a key figure in the Iran-Contra scandal — to provide CIA Director Mike Pompeo and the White House with a global, private spy network that would circumvent official U.S. intelligence agencies, according to several current and former U.S. intelligence officials and others familiar with the proposals. The sources say the plans have been pitched to the White House as a means of countering “deep state” enemies in the intelligence community seeking to undermine Donald Trump’s presidency. The creation of such a program raises the possibility that the effort would be used to create an intelligence apparatus to justify the Trump administration’s political agenda.

Parts of the story were true — The Intercept was hand-delivered contracts by national security sources who are seeking to kill the proposals, developed by a company named Amyntor — but its entire premise was false. The Amyntor program they are discussing is not illegal or “black”; it’s being reviewed through legal and authorized oversight channels, and would be an official, non-black government program run by intelligence agencies. “The Intercept may not like the proposed program, but it is not illegal,” I wrote in my first piece.

The story was pushed, directly or indirectly, to The Intercept and other publications by Michael Anton, the far-right lunatic and spokesman for the NSC whom I recently wrote about here. This is ironic because in a story earlier this year The Intercept disparaged Anton, accurately, as being “obsessed” with nuclear apocalypse.

Michael Anton: Twiddled Scahill and Cole like Yo-Yos.

Several sleazy NSA veterans who work on the Trump NSC, including Rob Joyce, had a hand in this media operation as well. Some media outlets who got the same information, including the normally credulous Washington Post, declined to publish stories because they realized they were being played.

Jeff Morley, a friend and longtime Washington journalist, wrote me a letter criticizing my story:

So let’s talk about your criticism of Scahill and Cole’s piece in The Intercept. I don’t see much dispute about some of the facts of the matter. The Intercept reported that working collaborators of Erik Prince have put forward a proposal in which a private security firm Amyntor, would undertake intelligence tasks for the CIA including counterterrorism, rendition, and propaganda.

It seems to me your difference is less about facts than about the interpretation of the proposal. This is hard to assess because the words “illegal” and “black” do not appear in the Intercept piece. Are you saying the Amyntor proposal was for non-classified work? Is that what the proposal says?  This is an important factual point, and I don’t have the proposal.

So here’s my AlterNet piece on the subject. I didn’t use any facts of the national security state. I don’t see any factual errors. I don’t think I’m in love with the CIA, NSA and NSC. I wasn’t used by them. Is this a story not worth reporting?

To which I would say, yes, it is worth reporting, but, as always, with skepticism, without being used, and getting the facts right. Let me go through some of the criticism I have received and rebut it, and I’ll destroy The Intercept‘s embarrassingly wrong story along the way.

Morley writes, “the words ‘illegal’ and ‘black’ do not appear in The Intercept piece.” Fine, but the story’s language suggested strongly that this was an illegal program, referring to “a global, private spy network that would circumvent official U.S. intelligence agencies,” and quoting a former intelligence official saying, “It is a direct-action arm, totally off the books.”

Morley’s own story also suggested this was a black, illegal program in its headline: “The Last Thing America Needs Is Trump Armed with His Own Private CIA; Oliver North and the recurring presidential dream of running secret operations ‘off the books’.”

This is simply false. The Amyntor program, good or bad, was legal and entirely “on the books.” It would be run by the CIA, covered by congressional oversight and the president would run it. You can say that the CIA is evil and Donald Trump is an idiot all you want, but the program was not “off the books.”

Furthermore, Erik Prince and Oliver North have nothing to do with Amyntor’s program, other than knowing some of the company officials. They are not part of the Amyntor team and didn’t stand to gain from its proposal. (Buzzfeed‘s less sensational story cited a source who said that while “Prince is close to some Amyntor officials, he has nothing to do with” its proposals.)

Prince has been promoting a plan — which is sharply criticized by one of his former employee’s here — that would “replace U.S. troops in Afghanistan with mercenaries, preferably his.” That plan might be a a terrible one — more below — but it’s not the same thing as the Amyntor plan. But Scahill has been milking Blackwater and Prince for ages — though brave Cap’n Jerkoff has never mustered the courage to call Prince — so he tossed in his name and North’s because they’re red meat to the large knee-jerk lefty component of his audience.

The Intercept story was planted by the National Security Council to benefit major private defense contractors with which it is allied — the ones already feeding at the bloody trough of the Iraq and Afghanistan wars — and who don’t want Amyntor or other small-fry companies moving in on their turf. In short, this was the military-industrial complex making use of naive — at best — reporters to promote its dishonest but profitable narrative.

Look, I’m not endorsing the Amyntor plan, and I don’t know enough about it to evaluate it fully, but it’s certainly no loopier than the Pentagon’s failed policies of the past 16 years. You say you don’t like private contractors? They’re already running our overseas wars, they’re just doing it very, very badly.

The separate plan Prince has been promoting — on TV, which suggests it’s not top secret — would greatly reduce the number of U.S. troops in Afghanistan and replace them with a much smaller number of contractors, and with more help from Afghanistan’s national security forces.

Would it work? I seriously doubt it; I don’t think anything can salvage our Afghanistan misadventure, and we should have pulled out long ago. Should any firm owned by Prince get such a contract? Probably not, given his horrendous track record.

But should the United States be looking at reducing the number of troops deployed abroad and rethinking the wars in Afghanistan and Iraq? Absolutely, and so Prince’s plan should be rationally looked at, even if it — and he — is rejected.

My view is that nation-building never works, that it is designed to benefit the “nation-builder,” and that Afghanistan and Iraq are far worse off as a result of the respective U.S.-led invasions, occupations and “reconstructions.” The worst tragedy is for Iraqis and Afghans, but there are also a huge number of American 22-year-olds who have been killed and wounded since 9/11, and taxpayers have paid out countless billions to foot the bill.

The war in Afghanistan is the longest in our history, and there has been a staggering loss of blood and treasure — in a losing effort. Meanwhile, the default position of the powerful national security establishment remains that any time there is a problem abroad, call the Pentagon, send in troops and bombs away.

This is terrible for the country, and the world, but it’s great for the bloated military-industrial complex. Northrop Grumman, Boeing and Lockheed Martin all have lucrative war-related Indefinite Duration, Indefinite Quantity (IDIQ) contracts. It’s like an ATM machine that just keeps giving out money, and the contractors and their Pentagon allies will seek to destroy any new company that tries to get a piece of the action — which led to the Intercept story.

Giant defense contractors currently fly gasoline from the United States to Afghanistan, at a cost to taxpayers of up to $400 a gallon. If the media did its job and reported such stories, there would be pitchforks out.

Here’s another unreported story of note:

Last November 6, two days before the election, the Pentagon parked $500 million in a Northrop Grumman bank account. The money was never used for its original purpose — and it’s not clear where it went — but Northrop Grumman took a 20 percent handling fee. Loan sharks don’t even get 20 percent, but Northrop Grumman does and pocketed $100 million on the deal, for basically handling a wire transfer fee. This amounts to a RICO operation.

And that’s where we get back to the Intercept story. After taking office, Trump’s administration reached out to Northrop about using some of its government-allocated money to get a program going to counter ISIS online. ISIS has several dozen online vehicles and two magazines, which are published in six languages.

Despite spending billions since 9/11, the U.S. has nothing significant on the Internet or dark web, hence ISIS has command of the “air waves” and the narrative. It’s not expensive to counter ISIS online; it just requires a little bit of brainpower, language skills, and a small amount of money.

That’s what Amyntor wanted to do. Maybe it was the wrong company for the job, but somebody needs to do it. Instead, we have The Intercept being used to shoot down a legal, on the books program in order to promote its sources’ agendas, and the military-industrial complex’s mega-profits.

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