ROBERT SIEGEL, host:

There has been strong reaction today to the news that the State Department granted limited immunity to Blackwater employees. Those are the security contractors who were involved in a deadly shooting in Baghdad on September 16th. Democrats say the administration is letting the guards off Scott free. The State Department says not so. Anyone responsible for a crime will still be prosecuted. It's still unclear who promised the limited immunity, who knew about it and what it will mean for the investigation.

NPR's national security correspondent Jackie Northam is here to talk about what we do know. And Jackie, Blackwater continues to dominate much of the conversation in Washington. What are today's developments here?

JACKIE NORTHAM: Well, Robert, this shooting incident in Baghdad last month which left 17 Iraqi civilians dead has just created something of a political feeding frenzy here in D.C. And so when news like this breaks, it just ratchets up the intensity.

Today, Senate Judiciary Committee Chairman Patrick Leahy called the Bush administration the amnesty administration, saying if you get caught from misconduct or incompetence, you'll be granted immunity. Presidential candidate Barack Obama called on Condoleezza Rice to say if she knew about this and whether she agreed with it. And Henry Waxman, the Democratic chair of the House Oversight Committee, started firing off letters to key State Department officials, asking them to answer from the very point to the questions about this. So they're trying to get to the bottom of it.

SIEGEL: And what is the administration saying about it? Specifically, what is the State Department saying about it?

NORTHAM: Well, neither White House nor the State Department are confirming or denying this. However, people I spoke with would say that the complication over the immunity is why the State Department handed off its investigation of this incident to the FBI. And it's apparently also what led to last week's resignation of Richard Griffin who headed up the diplomatic security corps.

The White House is saying that everything is under review right now. The State Department says it won't address on ongoing investigation. However, it did say that it does not have the authority to grant full immunity, only limited immunity which what happened here. Which means any statement that the witnesses make cannot be used against him. However, they still can be prosecuted for a criminal offense.

SIEGEL: Jackie, do we know if the Department of Justice has signed off on that immunity deal?

NORTHAM: Well, it is becoming increasingly clear that the State Department investigators did not tell the Justice Department or the FBI that they were offering this limited protection to the Blackwater employees. People I spoke with over the past few days say the two agencies probably would not have signed off on this. The State Department went ahead. And what that means now is that building the case will be much more difficult, it'll be much more complicated and protracted.

SIEGEL: Now while we have this news unfolding here in Washington, the Iraqi government is also indicating that the shooting incident will not go away quietly. Today, Baghdad approved the draft law that would revoke immunity for foreign contract.

NORTHAM: That's right. The bill would scrap decree that was issued back in 2004 just as the U.S. was handing control of the country to an interim Iraqi government. That decree insulated any foreign contractors from prosecution by the Iraqis. And this has been a real point of contention for the Iraqis because they see it as allowing foreign contractors to act with impunity. But the bill still has to be passed by Iraq's parliament. And that's not a foregone conclusion.

SIEGEL: NPR national security correspondent Jackie Northam. Jackie, thank you very much.

NORTHAM: Thank you, Robert.

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