The Attorney General is now admittedly in contempt of Congress, having lied to them. He probably knows or fears that another of the domestic surveillance programs is going to become public knowledge and needed to cover his butt. The Republican-controlled Congress will not take any action against him - they stand by mute while the Bush administration strips us of our rights.
Why is this important? First off, all the authority conferred on the Administration and Congress resides in "We the People". When the administration lies to Congress, they are lying to US, who are the source of all political authority in this country. We are supposed to have a representative government (as opposed to a democracy), and the administration is subverting that process of checks and balances to their own ends, claiming Imperial powers in "wartime".