Month: July 2019

Legal Duty to Report Your Coworkers’ Off-the-Job Crimes?

Last August, I wrote about the New Jersey Appellate Division decision:

Say a coworker is chatting with you at work, and the coworker says something that suggests that he’s having sex with a teenager who’s just below the age of consent. The relationship has nothing at all to do with your company. It’s not on company property. It’s not on company time. It’s not enabled by the coworker’s job. Nor is there a state statute obligating you to report suspected sex crimes you hear about.

What do you do? Maybe you might call the police, to tip them off to the possible crime. Or maybe you’re not sure there is a crime (the coworker hasn’t outright confessed to the crime). Or maybe you’re wary of the police, and don’t want to get them involved. Or maybe you’re not wild about the state’s statutory rape law—you’re not going to violate it yourself, but you don’t want to turn someone in for it. Or maybe (rightly or wrongly) you just don’t want to be seen as the kind of guy who turns his acquaintances in to the police.

Well, in New Jersey, you’d better call the police—or else you could get sued by the victim. Indeed, the victim could also sue your employer for your failure, so your employer had better have a policy requiring employees to call the police in such situations, and had better develop a track record of enforcing the policy. That’s what a New Jersey decision from a couple of weeks, G.A.-H. v. K.G.G., threatens.

The New Jersey Supreme Court agreed to consider the case, and I just learned that late last month it reversed the Appellate Division decision. It didn’t decide the general legal question of whether such a coworker duty exists, holding instead that, on the facts of this particular case, no such duty would be triggered in any event. But at least the Appellate Division decision is no longer precedent. An excerpt:

In this case, we consider whether defendant A.M. (Arthur) was obligated to report that his co-worker K.G.G. (Kenneth) was engaged in a sexual relationship with a [15-year-old]; whether their employer, GEM Ambulance, LLC (GEM), is vicariously liable for Arthur’s failure to report; and whether GEM negligently retained, trained, or supervised Arthur or Kenneth.

Plaintiff [sued not just Kenneth but also Arthur and GEM], alleg[ing] that Arthur should have reported Kenneth to supervisors at GEM and that GEM was both vicariously liable for Arthur’s failure to report Kenneth’s conduct and negligent in retaining, training, and supervising Arthur and Kenneth…. The Appellate Division … [held that the case could go forward] because, in its view, “the common law does not necessarily preclude the imposition of” a duty to report that a co-worker is engaged in a sexual relationship with a minor and the record here was not sufficiently developed to determine whether Arthur knew of Kenneth’s illicit sexual relationship with plaintiff.

We reverse … [because] no reasonable trier of fact could find that Arthur knew or had special reason to know that Kenneth was engaged in a sexual relationship with a minor. Accordingly, Arthur had no duty to report Kenneth…. [W]e need not decide whether a co-worker or employer with knowledge or a special reason to know that a co-worker or employee is engaged in a sexual relationship with a minor has a legal duty to report that co-worker or employee….

In J.S. v. R.T.H. (N.J. 1998), this Court held that a spouse owes children sexually abused by her husband a duty of care “to take reasonable steps to prevent or warn of the harm” when she has “actual knowledge or special reason to know that her husband is abusing or is likely to abuse an identifiable victim.” We need not decide whether that duty should apply to co-workers because no reasonable trier of fact could find that Arthur knew or had special reason to know that Kenneth was engaged in an illegal sexual relationship with a minor.

The plaintiff has pointed to the following facts to establish a duty of care for Arthur to report Kenneth:  (1) Kenneth walked plaintiff to her bus stop  while she carried a backpack; (2) Kenneth  gave inconsistent accounts of the  age of his “girlfriend” when bragging to co-workers about his “girlfriend”; and (3) Kenneth showed Arthur pictures or videos of a naked female on his flip-phone. However, those facts do not establish that Arthur knew Kenneth was engaged in a sexual relationship with a minor—nor do those facts establish a “special reason [for Arthur] to know” that Kenneth was engaged in a sexual relationship with a minor.

It is often difficult to know someone’s age based upon appearance alone…. Nothing in the record suggests that Arthur viewed any pictures or  videos of plaintiff.   But, even assuming he did, in order for Arthur to know  that plaintiff was below the age of consent, he would have had to perceive the difference between someone who is above or below the age of consent based upon appearance alone and from a small cellphone image. A small cellphone image of a naked female does not give rise to a “special reason to know” that Kenneth was engaged in a sexual relationship with a minor.

We further hold that there are no facts presented upon which liability could attach to GEM. Because Arthur did not commit a tort, GEM cannot be held vicariously liable for his conduct.  And the record does   not adequately support plaintiff’s claim for negligent retention, training, or supervision. Although plaintiff has pointed to various actions by Kenneth that occurred at work, the only tort in this case is Kenneth’s off-duty abuse of plaintiff.  That Kenneth bragged about having a younger “girlfriend” at work  and also drove a GEM ambulance to plaintiff’s bus stop [to meet plaintiff] does not make GEM negligent in retaining, training, or supervising Kenneth or Arthur….

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Legal Duty to Report Your Coworkers’ Off-the-Job Crimes?

Last August, I wrote about the New Jersey Appellate Division decision:

Say a coworker is chatting with you at work, and the coworker says something that suggests that he’s having sex with a teenager who’s just below the age of consent. The relationship has nothing at all to do with your company. It’s not on company property. It’s not on company time. It’s not enabled by the coworker’s job. Nor is there a state statute obligating you to report suspected sex crimes you hear about.

What do you do? Maybe you might call the police, to tip them off to the possible crime. Or maybe you’re not sure there is a crime (the coworker hasn’t outright confessed to the crime). Or maybe you’re wary of the police, and don’t want to get them involved. Or maybe you’re not wild about the state’s statutory rape law—you’re not going to violate it yourself, but you don’t want to turn someone in for it. Or maybe (rightly or wrongly) you just don’t want to be seen as the kind of guy who turns his acquaintances in to the police.

Well, in New Jersey, you’d better call the police—or else you could get sued by the victim. Indeed, the victim could also sue your employer for your failure, so your employer had better have a policy requiring employees to call the police in such situations, and had better develop a track record of enforcing the policy. That’s what a New Jersey decision from a couple of weeks, G.A.-H. v. K.G.G., threatens.

The New Jersey Supreme Court agreed to consider the case, and I just learned that late last month it reversed the Appellate Division decision. It didn’t decide the general legal question of whether such a coworker duty exists, holding instead that, on the facts of this particular case, no such duty would be triggered in any event. But at least the Appellate Division decision is no longer precedent. An excerpt:

In this case, we consider whether defendant A.M. (Arthur) was obligated to report that his co-worker K.G.G. (Kenneth) was engaged in a sexual relationship with a [15-year-old]; whether their employer, GEM Ambulance, LLC (GEM), is vicariously liable for Arthur’s failure to report; and whether GEM negligently retained, trained, or supervised Arthur or Kenneth.

Plaintiff [sued not just Kenneth but also Arthur and GEM], alleg[ing] that Arthur should have reported Kenneth to supervisors at GEM and that GEM was both vicariously liable for Arthur’s failure to report Kenneth’s conduct and negligent in retaining, training, and supervising Arthur and Kenneth…. The Appellate Division … [held that the case could go forward] because, in its view, “the common law does not necessarily preclude the imposition of” a duty to report that a co-worker is engaged in a sexual relationship with a minor and the record here was not sufficiently developed to determine whether Arthur knew of Kenneth’s illicit sexual relationship with plaintiff.

We reverse … [because] no reasonable trier of fact could find that Arthur knew or had special reason to know that Kenneth was engaged in a sexual relationship with a minor. Accordingly, Arthur had no duty to report Kenneth…. [W]e need not decide whether a co-worker or employer with knowledge or a special reason to know that a co-worker or employee is engaged in a sexual relationship with a minor has a legal duty to report that co-worker or employee….

In J.S. v. R.T.H. (N.J. 1998), this Court held that a spouse owes children sexually abused by her husband a duty of care “to take reasonable steps to prevent or warn of the harm” when she has “actual knowledge or special reason to know that her husband is abusing or is likely to abuse an identifiable victim.” We need not decide whether that duty should apply to co-workers because no reasonable trier of fact could find that Arthur knew or had special reason to know that Kenneth was engaged in an illegal sexual relationship with a minor.

The plaintiff has pointed to the following facts to establish a duty of care for Arthur to report Kenneth:  (1) Kenneth walked plaintiff to her bus stop  while she carried a backpack; (2) Kenneth  gave inconsistent accounts of the  age of his “girlfriend” when bragging to co-workers about his “girlfriend”; and (3) Kenneth showed Arthur pictures or videos of a naked female on his flip-phone. However, those facts do not establish that Arthur knew Kenneth was engaged in a sexual relationship with a minor—nor do those facts establish a “special reason [for Arthur] to know” that Kenneth was engaged in a sexual relationship with a minor.

It is often difficult to know someone’s age based upon appearance alone…. Nothing in the record suggests that Arthur viewed any pictures or  videos of plaintiff.   But, even assuming he did, in order for Arthur to know  that plaintiff was below the age of consent, he would have had to perceive the difference between someone who is above or below the age of consent based upon appearance alone and from a small cellphone image. A small cellphone image of a naked female does not give rise to a “special reason to know” that Kenneth was engaged in a sexual relationship with a minor.

We further hold that there are no facts presented upon which liability could attach to GEM. Because Arthur did not commit a tort, GEM cannot be held vicariously liable for his conduct.  And the record does   not adequately support plaintiff’s claim for negligent retention, training, or supervision. Although plaintiff has pointed to various actions by Kenneth that occurred at work, the only tort in this case is Kenneth’s off-duty abuse of plaintiff.  That Kenneth bragged about having a younger “girlfriend” at work  and also drove a GEM ambulance to plaintiff’s bus stop [to meet plaintiff] does not make GEM negligent in retaining, training, or supervising Kenneth or Arthur….

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Epstein-Clinton Connection Forged By Alleged ‘Madam’ Ghislaine Maxwell

Prolific pedophile Jeffrey Epstein was introduced to former President Bill Clinton through Epstein’s longtime confidant and alleged procurer of young women – Ghislaine Maxwell. 

The daughter of embattled publisher and suspected Russian-funded Mossad agent Robert Maxwell, The 57-year-old Maxwell maintained a high orbit as an East Coast socialite, according to Politico.

It is unclear how Epstein and the Oxford-educated Maxwell first met, however they reportedly dated around 1992 shortly after her father’s death. Then in 1995, Epstein named a now-defunct Palm Beach business “Ghislaine Corp.” In 2003, Epstein described Maxwell as his “best friend.” 

She was also procuring young, often underage girls, to feed Epstein’s sexual urges according to Epstein accusers and witnesses. 

According to court filings, Maxwell was said to have hired, supervised and fired household staff, while directing the visits of dozens of “massage therapists” to Epstein’s residence, according to a Wall Street Journal report earlier this month. 

In depositions taken in 2009 and 2010 as part of civil lawsuits against Mr. Epstein, household employees said Ms. Maxwell was a central figure in Mr. Epstein’s private life. Several said Ms. Maxwell hired, supervised, and fired household staff, while directing the visits of dozens of “massage therapists”—typically young women.

Juan Alessi, who said in one of the depositions that he served as the Palm Beach house manager from around 1992 through 2002, described a basket of sex toys in Ms. Maxwell’s bathroom closet. He said he would find them around when he cleaned up after visits from the young women. –WSJ

“The defendant worked with others, including employees and associates who facilitated his exploitation of minors, by among other things, contacting victims and scheduling their sexual encounters with the defendant,” according to US prosecutors, ostensibly referring to Maxwell. 

And then there’s the Clintons…

According to Politico, “Maxwell first grew close with the Clintons after Bill Clinton left office, vacationing on a yacht with Chelsea Clinton in 2009, attending her wedding in 2010, and participating in the Clinton Global Initiative as recently as 2013, years after her name first emerged in accounts of Epstein’s alleged sexual abuse.” 

Chelsea was in turn introduced to Epstein through Maxwell’s ex, billionaire founder of Gateway computer, Ted Waitt of La Jolla, CA. 

A person close to Chelsea Clinton described Waitt as a “very close family friend” of Clinton and her husband, Marc Mezvinsky, and said the couple met Maxwell through him in 2011. The person said Clinton and her husband ended their friendship with Maxwell when she and Waitt broke up in early 2011, and disputed that Maxwell and Chelsea Clinton were ever “close.” 

Two people familiar with the relationship between Maxwell and the Clintons said Maxwell, Clinton and Mezvinsky flew together on a private plane to rendezvous with Waitt for a trip on Waitt’s yacht. One of those people said the trip took place in 2009.

Waitt, whose philanthropic endeavors focus on the world’s oceans, has given somewhere between $10 million and $25 million to the Clinton Foundation. –Politico

Not true, according to a friend of Maxwell, who told Politico: “The Clintons were relatively intimate with her,” a friend of Maxwell told Politico. Meanwhile, “In 2002 and 2003, flight logs reportedly show that Bill Clinton flew on 26 flight legs on Epstein’s private jet,” according to the report. 

So that we’re clear – the Clintons became “relatively intimate” with Maxwell – who was known as Epstein’s inseparable assistant and ‘sex scheduler’ – long after Epstein admitted to being a pedophile in a controversial 2008 plea deal.

Maxwell’s ties to Clintonworld, meanwhile, would last another decade.

One friend of Maxwell’s, who spoke on the condition of anonymity, described their surprise upon showing up at a dinner party at her Upper East Side apartment around 2005 to find Doug Band, then a top adviser to Bill Clinton and the Clinton Foundation, among the 8 to 10 guests. In 2006, a charity run by Epstein, C.O.U.Q. Foundation, gave $25,000 to the Clinton Foundation, the Daily Beast reported. –Politico

“Ghislaine was the contact between Epstein and Clinton,” a person familiar with the relationship told Politico. “She ended up being close to the family because she and Chelsea ended up becoming close.” 

A spokesperson for Clinton has disputed that the two women were ever close, while Bill Clinton issued a statement via spokesman Angel Urena, claiming “President Clinton knows nothing about the terrible crimes Jeffrey Epstein pleaded guilty to in Florida some years ago, or those with which he has been recently charged in New York.” 

Urena said the flight legs comprised four trips in 2002 and 2003 and that staff and Secret Service were present on all flights. Urena said Epstein visited Clinton at his Harlem office once in 2002 and that he briefly visited Epstein’s apartment one time. –Politico

The Trump connection

Politico also reveals the depth of President Trump’s relationship with the Maxwells – in particular Robert Maxwell – which went back “to at least the late 1980s” until the Czech-born Daily Mirror owner died after falling off his Yacht, Lady Ghislaine, in the Atlantic Ocean (ruled an accident). 

An item from a May 1989 gossip column placed Trump and both Maxwells at a party aboard the elder Maxwell’s yacht, named the Lady Ghislaine, that featured caviar flown in from Paris and former Republican Sen. John Tower of Texas. The item notes that Trump compared his own larger yacht with Maxwell’s.

As it happened, Trump’s yacht, the Trump Princess, had originally belonged to the Saudi arms dealer Adnan Khashoggi — the uncle of slain Washington Post contributor Jamal Khashoggi — and Maxwell’s yacht had originally belonged to one of Adnan’s brothers.

“He was a character and a colorful guy, and I think we were lucky to have seen even a short time of him in New York,” Trump told Larry King of Maxwell two weeks later. “He was my kind of a guy.” 

In 1997, Maxwell “bummed a ride” on Trump’s private jet along with the author of a New Yorker profile of Trump – Mark Singer, who referred to Maxwell’s father as an “inadequate swimmer.” 

Meanwhile, Maxwell was instrumental in Jeffrey Epstein’s rise within her sphere of influence. 

It is unclear whether Ghislaine Maxwell first introduced Trump and Epstein, who socialized together at least as early as 1992, but she was crucial in ensuring Epstein’s access to Trump’s world. Archival video unearthed on Wednesday by NBC from that year shows Trump and Epstein surrounded by dancing women at Mar-a-Lago, with Maxwell smiling in the background.

And with that, Maxwell also began recruiting for Epstein – as detailed in a lawsuit brought by former Mar-a-Lago changing room attendant Virginia Roberts Guiffre – who claims she was approached by Maxwell in 1998 to meet Epstein, after which the two of them participated in her sexual abuse.

Maxwell has denied the entire thing.  

According to the Daily Telegraph, Maxwell also introduced Epstein to British Royal Prince Andrew – the two of whom were pictured with Epstein accuser Virginia Roberts, who claims to have seen Bill Clinton on Epstein’s infamous island while she was being sex-trafficked. 

Epstein also attended a birthday party for Queen Elizabeth at Windsor Castle in 2000. That same year, Maxwell and Prince Andrew attended what the Daily Mail described as a “hookers and pimps”-themed Halloween party hosted by Heidi Klum.

A month later, in early December 2000, Trump, his future wife Melania, Epstein and Maxwell all attended a surprise 60th birthday for Barbara Amiel, a British socialite, that was also attended by the likes of Anna Wintour, Charlie Rose and William F. Buckley.

Tina Brown, a notable magazine editor, recalled that around this period Maxwell would reach out to her to socialize when Prince Andrew came to New York. “She was a bit mysterious,” Brown recalled.

In short – when it comes to the socially awkward Jeffrey Epstein and his connection to the elite circles he mingled in, it’s all about Ghislaine. 

via ZeroHedge News https://ift.tt/2K0tfj5 Tyler Durden

Here’s a phrase you’ll never hear again in the USA

“Gentlemen… the National Debt… is paid.”

That sentence has been uttered in Washington DC exactly one time ever, by a Senator announcing that the US government was officially debt free.

That was on January 8, 1835 when the debt that the United States government had accrued since it’s birth was finally paid off.

Never again would the United States be debt free.

It took 174 years for the debt to rack up to a mind boggling $11 TRILLION in 2009.

And then it took only ten years to balloon ANOTHER $11 trillion.

Today the national debt is larger than the entire economy of the USA, $22 trillion.

It took 147 years to get a trillion dollars into debt. The USA now routinely adds at least $1 trillion in debt every 365 days.

And why exactly are we adding all this debt? These are the good times!

The economy has been growing for a decade. The stock market is pumping up to all time highs. Almost every asset class is practically bursting with wealth. We’ve even seen record tax revenues.

And still, routine spending is a trillion dollars more than the government collects.

Any semblance of financial restraint is not even an afterthought on politicians’, or their constituents’, mind.

This is really insane.

Back in 2009, people were actually talking about how troubling the debt was… when it was half of what it is now.

A 2009 Forbes article is almost adorable as it predicts the US debt will be $14 trillion by 2019. Only about 50% off… and still, the author was extremely concerned. As he should have been.

As we all should be, even more so now.

Back then, 7.7% of the revenue the federal government collected went towards servicing the debt, about $162 billion.

This year about 15.4% of the $3.4 trillion tax revenue was spent entirely on interest payments for America’s massive debts. That’s $523 billion of productivity taxed away, because the politicians don’t care to balance the budget and pay down the debt.

That is just the interest. It’s like if you or I paid just the minimum balance on our credit card every month, while spending 33% more than we earn each year.

Eventually, your card would be declined.

But the US government has the power to raise the limit on it’s own credit card, the debt ceiling, which it routinely does.

They may be able to ignore economic realities for much longer than we can. But rest assured, the same principles apply.

Remember, these are the good times, interest rates are low, and everyone still considers the US government good for their debts.

But suppose a recession take a chunk out of tax revenue. Or suppose the US gets embroiled in even more, larger, costlier wars– far fetched, right?

There’s no telling what kind of turmoil this unsustainable debt could cause, even without a major event. From Rome to the Weimar Republic, massive debts have wreaked havoc on the value of money, and society in general.

That’s not to say that the same would necessarily happen in the USA. But what is certain is that countries with healthy finances fare better.

It is the Universal Law of Prosperity: take in more money than you spend. And when that hasn’t even been an afterthought for politicians in decades, it is time to prepare for the havoc that could wreak on society.

Rational people don’t ignore these things.

There are so many steps that you can take to insulate yourself from the consequences of this runaway debt.

One is to move some of your savings into precious metals like gold and silver. Chances are that what’s been true for the last few thousand years will continue to be true: they hold their value.

It also makes sense to spread some of your risk outside the USA.

That could mean getting a second passport, so that one country doesn’t get to dictate where you can live, work, and travel.

Foreign property gives you somewhere to go in the worst case scenario. Foreign bank accounts mean you have some money outside the reach of certain governments, and American lawyers.

And the best thing about taking all these steps to survive and thrive through the likely turmoil the debt will cause, is that you aren’t any worse off, even if nothing happens.

There is absolutely no downside to protecting yourself and your family with these, and many other “Plan B” strategies.

Source

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Students Slam Obama Immigration Quote… When They Think It’s From Trump

Authored by Cabot Phillips via Campus Reform,

President Donald Trump announced that he would use ICE to track down and deport illegal aliens who have been convicted of a crime.

The move prompted outrage from many on the Left who accused the practice of being anti-immigrant and unprecedented.

Proponents of the move pointed out this week that President Barack Obama gave his support to the same policy when he was in office and bragged of deportations of criminals having increased 80 percent during his tenure.

In 2014, Obama gave an immigration address from the White House, in which he said: 

We are a nation of laws. Undocumented workers broke our immigration laws, and I believe that they must be held accountable, especially those who may be dangerous. That’s why over the past six years deportations of criminals are up 80 percent, and that’s why we’re going to keep focusing on threats to our security. 

Wanting to know what college students would think of this quote and whether Obama was “racist” for wanting to deport illegal aliens convicted of a crime, Campus Reform‘s Cabot Phillips headed to Georgetown University to find out. 

After being told the quote came from “a president,” students offered near-universal condemnation for it, as well as the policy of deporting criminals. 

“I think that policy comes from a place of white American nationalism,” one said, before another added, “Donald Trump has embraced this rhetoric of racism and xenophobia that’s not beneficial to our country at all.”

“I don’t think that quote stands true,” another stated.

“It’s just really awful.”

After gathering their responses, Phillips played each student the video of Obama’s speech, showing them he was the president the quote belonged to. 

“I thought it was the Trump administration that said something like that,” one bewildered student said, while another agreed, saying “I didn’t expect it to be Obama… it never occurred to me that it could be him.”

“It’s quite surprising. I thought that was from Trump,” another said.

“My understanding of Obama vs Trump is that Obama was more liberal as far as amnesty… I expected that quote to come from Trump.”

One student said it reminded him how hypocritical many politicians have become:

“One person can say something five years ago and next thing you know it doesn’t apply to them anymore and they can now be the morality police for whoever is in office now.”

What did the others have to say? 

Watch the full video to find out…

via ZeroHedge News https://ift.tt/2OkK5yW Tyler Durden

Ceasefire On The Rocks? Trump Sanctions Chinese Firm For Importing Iranian Crude

A huge escalatory step in the US-led economic war on Tehran and its global oil exports, and amid continued trade tensions with Beijing: the US State Department said Monday the US will impose new sanctions against a Chinese company for transporting Iranian crude in contravention of US sanctions. As the WSJ reports: 

Secretary of State Mike Pompeo told The Wall Street Journal on Monday that Chinese company Zhuhai Zhenrong and one of its executives knowingly violated U.S. law barring the import of Iranian crude oil.

China had previously been part of the so-called waiver program, which had granted eight countries exceptions which allowed temporary imports of Iranian oil, but which expired May 2 of this year.

Crude oil is unloaded at Zhoushan, East China’s Zhejiang province in February 2018. Image source: VCG

The US did not renew the waiver program, known as ‘Significant Reduction Exceptions,’ in what was seen globally as a serious escalation by Washington attempting to bring Europe and other economic partners to heel over continued dealings with Tehran. 

The Chinese company has been identified as Zhuhai Zhengrong Co Ltd, which Pompeo accused of violating US law over its continued Iran crude imports. Notably, its CEO will also be under sanction. 

The WSJ continued:

The company and the executive will be barred from engaging in any foreign exchange, banking or property transactions under U.S. jurisdiction. The company couldn’t be immediately located for comment. Chinese officials did not respond to a request for comment.

Pompeo said while addressing reporters in Florida, “We’ve said that we will sanction any sanctionable behavior and we mean it.”

Crucially, CNN noted late last week following Iran’s navy capturing a British-flagged tanker that the White House could once again be on a war footing following President Trump backing off the previously planned strike on Iranian positions last month: “President Trump has privately adopted a more hawkish tone on Iran in recent days, according to three people familiar with the developments, as tensions increase in the Gulf,” the report said.  

via ZeroHedge News https://ift.tt/2GqugQF Tyler Durden

RIP Mark Kleiman, Who Brought Rigor, Dispassion, and Candor to a Frequently Overheated Drug Policy Debate

Back in 1989, Mark Kleiman published a book, Marijuana: Costs of Abuse, Costs of Control, that exemplified his calm, methodical, just-the-facts approach to drug policy. Kleiman argued that federal efforts to curtail cannabis consumption were ineffective and diverted resources from programs that had a better public safety payoff. Three years later, in Against Excess: Drug Policy for Results, he came out in favor of legalizing marijuana, arguing that the costs of prohibition outweighed its benefits. At a time when three-quarters of Americans still supported marijuana prohibition, Kleiman’s position was striking, especially coming from a widely quoted and consulted academic who had the ear of policy makers.

When fellow libertarians complained to me about Kleiman’s legendary prickliness, I would remind them of that history, which illustrated his best qualities: intellectual rigor and honesty, combined with a willingness to draw unpopular conclusions when he believed they were justified by the evidence. I did not always agree with Kleiman’s conclusions, but I admired his method, which acknowledged subtleties and uncertainties, anticipated counterarguments, and insisted on empirical support for claims that were frequently asserted as articles of faith.

“Eventually we must learn to discuss our drug policies without raising our voices,” Kleiman wrote in Against Excess. “A drug-crazed drug warrior can be as great a public menace as a drug-crazed addict.” He never lost sight of the burdens imposed by coercive drug policies, even when he supported them.

That’s the Mark Kleiman I will miss. His rhetoric as a partisan Democrat, which was sometimes directed at me for reasons that were hard to fathom, could be short on facts and long on feelings. But his policy analysis, whether or not you agreed with him, was a model of logic and dispassion.

Kleiman, who died yesterday at the age of 68 due to complications following a kidney transplant, favored noncommercial legalization of marijuana, fearing the public health consequences of mixing cannabis and capitalism. He also had a soft spot for psychedelics, recognizing their low abuse potential and potentially profound benefits for individuals who use them properly. Years ago I was startled when I ran into him during a psychedelic conference at a Unitarian church in San Francisco, where he wore a tie-dyed T-shirt under a blazer. Later I learned that he was a longtime friend of Earth and Fire Erowid, proprietors of the indispensable drug information website Erowid.org.

When it came to drugs such as heroin, cocaine, methamphetamine, tobacco, and alcohol, Kleiman took a harder line, discounting their benefits and emphasizing their hazards. During a 2008 Cato Unbound debate, I asked him whether, given the damage done by irresponsible and excessive drinking, he favored a return to alcohol prohibition, his response was characteristically candid:

Under existing U.S. conditions, I wouldn’t. There’s no public support for it. Compliance would be poor, and the illicit market large. The amount of public force required to overcome such a strong cultural pattern is greater than the evils of alcohol can justify….

Were I asked to legislate for a nation where alcohol was currently banned and where drinking was not currently a well-established practice, I’d be inclined to leave the law as it was. Why import a drug problem you don’t already have?

Kleiman thought the government should continue to prohibit relatively unpopular drugs such as heroin, cocaine, and (nonprescription) methamphetamine, arguing that it helped keep a lid on problems that might otherwise get out of control. But he never pretended that prohibition was cost-free, and he argued that in many respects it (and the criminal justice system more generally) was excessively punitive.

“We have a highly intrusive and semi-militarized drug enforcement effort that is often only marginally constitutional and sometimes more than marginally indecent,” Kleiman wrote in The American Interest several years ago. “Most drug use is harmless, and much of it is beneficial…No harm, no foul. Mere use of an abusable drug does not constitute a problem demanding public intervention.”

Kleiman understood that prohibition makes life worse for those who defy it, while arguing that such costs could be justified if banning drugs prevented others from developing habits that hurt them and others. Although the average cost of drug addiction is indisputably higher under prohibition, he suggested, the total cost could well be higher if legalization led to a big enough increase in abuse.

Even while Kleiman insisted on balancing costs against benefits, he conceded that the challenge of identifying and measuring them, combined with the difficulty of anticipating unintended consequences, frequently made that project questionable.   “Perhaps, if the AIDS epidemic had been foreknown,” he wrote in Against Excess, “a convincing argument could have been made that the increase in heroin addiction as a result of one or another form of legal availability would have been more than compensated for by the reduction in HIV transmission.”

While Kleiman was quick to acknowledge the ways that drug policies could go horribly wrong, he never gave up hope that better results could be achieved through carefully designed and enforced bans, taxes, licenses, and regulations. He was impatient with the argument that prohibition is fundamentally unjust because it deploys state violence against people who have not violated anyone’s rights, and he did not seem to perceive a moral problem with decriminalizing drug use while continuing to treat drug suppliers as criminals.

Despite our differences, Kleiman was always happy to engage in debate, and he was a formidable opponent. He was a lively (and entertainingly profane) interview subject who gave good quotes, and he could be remarkably gracious. After I reviewed Against Excess in Reason, praising his honesty but pulling no punches, he wrote a very kind letter to the editor thanking me for offering “well-reasoned criticism” and “giv[ing] a fair reading to a book whose conclusions he does not endorse.” Not long after he attacked me as an uninformed ideologue when I criticized Barack Obama’s response to a question about rescheduling marijuana, he and I both participated in a conference where he enthusiastically shook my hand and praised my presentation.

Kleiman, who cut his teeth as policy analyst at the Justice Department and later held a series of academic positions, most recently as a professor of public policy at New York University, could be counted on to call bullshit where he saw it. He criticized opposition to vaping as a harm-reducing alternative to smoking, for example, and debunked claims that marijuana causes psychosis and drives violent crime. While he tended to overestimate the ability of smart and knowledgeable people like him to fine-tune the nation’s drug habits, he was open to evidence and arguments that complicated that mission. Discussions of drugs and criminal justice in this country would be greatly improved if more people followed his example.

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RIP Mark Kleiman, Who Brought Rigor, Dispassion, and Candor to a Frequently Overheated Drug Policy Debate

Back in 1989, Mark Kleiman published a book, Marijuana: Costs of Abuse, Costs of Control, that exemplified his calm, methodical, just-the-facts approach to drug policy. Kleiman argued that federal efforts to curtail cannabis consumption were ineffective and diverted resources from programs that had a better public safety payoff. Three years later, in Against Excess: Drug Policy for Results, he came out in favor of legalizing marijuana, arguing that the costs of prohibition outweighed its benefits. At a time when three-quarters of Americans still supported marijuana prohibition, Kleiman’s position was striking, especially coming from a widely quoted and consulted academic who had the ear of policy makers.

When fellow libertarians complained to me about Kleiman’s legendary prickliness, I would remind them of that history, which illustrated his best qualities: intellectual rigor and honesty, combined with a willingness to draw unpopular conclusions when he believed they were justified by the evidence. I did not always agree with Kleiman’s conclusions, but I admired his method, which acknowledged subtleties and uncertainties, anticipated counterarguments, and insisted on empirical support for claims that were frequently asserted as articles of faith.

“Eventually we must learn to discuss our drug policies without raising our voices,” Kleiman wrote in Against Excess. “A drug-crazed drug warrior can be as great a public menace as a drug-crazed addict.” He never lost sight of the burdens imposed by coercive drug policies, even when he supported them.

That’s the Mark Kleiman I will miss. His rhetoric as a partisan Democrat, which was sometimes directed at me for reasons that were hard to fathom, could be short on facts and long on feelings. But his policy analysis, whether or not you agreed with him, was a model of logic and dispassion.

Kleiman, who died yesterday at the age of 68 due to complications following a kidney transplant, favored noncommercial legalization of marijuana, fearing the public health consequences of mixing cannabis and capitalism. He also had a soft spot for psychedelics, recognizing their low abuse potential and potentially profound benefits for individuals who use them properly. Years ago I was startled when I ran into him during a psychedelic conference at a Unitarian church in San Francisco, where he wore a tie-dyed T-shirt under a blazer. Later I learned that he was a longtime friend of Earth and Fire Erowid, proprietors of the indispensable drug information website Erowid.org.

When it came to drugs such as heroin, cocaine, methamphetamine, tobacco, and alcohol, Kleiman took a harder line, discounting their benefits and emphasizing their hazards. During a 2008 Cato Unbound debate, I asked him whether, given the damage done by irresponsible and excessive drinking, he favored a return to alcohol prohibition, his response was characteristically candid:

Under existing U.S. conditions, I wouldn’t. There’s no public support for it. Compliance would be poor, and the illicit market large. The amount of public force required to overcome such a strong cultural pattern is greater than the evils of alcohol can justify….

Were I asked to legislate for a nation where alcohol was currently banned and where drinking was not currently a well-established practice, I’d be inclined to leave the law as it was. Why import a drug problem you don’t already have?

Kleiman thought the government should continue to prohibit relatively unpopular drugs such as heroin, cocaine, and (nonprescription) methamphetamine, arguing that it helped keep a lid on problems that might otherwise get out of control. But he never pretended that prohibition was cost-free, and he argued that in many respects it (and the criminal justice system more generally) was excessively punitive.

“We have a highly intrusive and semi-militarized drug enforcement effort that is often only marginally constitutional and sometimes more than marginally indecent,” Kleiman wrote in The American Interest several years ago. “Most drug use is harmless, and much of it is beneficial…No harm, no foul. Mere use of an abusable drug does not constitute a problem demanding public intervention.”

Kleiman understood that prohibition makes life worse for those who defy it, while arguing that such costs could be justified if banning drugs prevented others from developing habits that hurt them and others. While the average cost of drug addiction is indisputably higher under prohibition, he suggested, the total cost could well be higher if legalization led to a big enough increase in abuse.

Even while Kleiman insisted on balancing costs against benefits, he conceded that the challenge of identifying and measuring them, combined with the difficulty of anticipating unintended consequences, frequently made that project questionable.   “Perhaps, if the AIDS epidemic had been foreknown,” he wrote in Against Excess, “a convincing argument could have been made that the increase in heroin addiction as a result of one or another form of legal availability would have been more than compensated for by the reduction in HIV transmission.”

While Kleiman was quick to acknowledge the ways that drug policies could go horribly wrong, he never gave up hope that better results could be achieved through carefully designed and enforced bans, taxes, licenses, and regulations. He was impatient with the argument that prohibition is fundamentally unjust because it deploys state violence against people who have not violated anyone’s rights, and he did not seem to perceive a moral problem with decriminalizing drug use while continuing to treat drug suppliers as criminals.

Despite our differences, Kleiman was always happy to engage in debate, and he was a formidable opponent. He was a lively and profane interview subject who gave good quotes, and he could be remarkably gracious. After I reviewed Against Excess in Reason, praising his honesty but pulling no punches, he wrote a very kind letter to the editor thanking me for offering “well-reasoned criticism” and “giv[ing] a fair reading to a book whose conclusions he does not endorse.” Not long after he attacked me as an uninformed ideologue when I criticized Barack Obama’s response to a question about rescheduling marijuana, he and I both participated in a conference where he enthusiastically shook my hand and praised my presentation.

Kleiman, who cut his teeth as policy analyst at the Justice Department and later held a series of academic positions, most recently as a professor of public policy at New York University, could be counted on to call bullshit where he saw it. He criticized opposition to vaping as a harm-reducing alternative to smoking, for example, and debunked claims that marijuana causes psychosis and drives violent crime. While he tended to overestimate the ability of smart and knowledgeable people like him to fine-tune the nation’s drug habits, he was open to evidence and arguments that complicated that mission. Discussions of drugs and criminal justice in this country would be greatly improved if more people followed his example.

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Maybe No Rate Cut In July?

Authored by Chris Whelan via TheInstitutionalRiskAnalyst.com,

We caused a bit of a fuss last week on CNBC by suggesting that the Federal Open Market Committee will not cut the target for Fed funds this month.  We suggested instead that the Federal Reserve Board will first end the runoff of the System Open Market Account (SOMA) and then “wait and see” about any change in the rate target.

Readers of The Institutional Risk Analyst know that we tend not to follow the crowd, especially when the data suggests that the narrative is at odds with actual market conditions. To us, any sudden and poorly considered change in policy by the Fed could create even more structural problems than we already face.

The basic problem facing the FOMC is that the combination of shrinking the Fed SOMA balance sheet, Basel III and the various other rules and regulations meant to “protect” banks has the effect of actually reducing liquidity.  The quarter ended June, for example, saw a lot of liquidity exit the market as we wrote last week.  With the short-term markets still clearly tightening, the FOMC is in the position of having to compensate for overly restrictive prudential regulations and the negative impact of a shrinking balance sheet.

Our colleague Ralph Delguidice at Pavillion Global Markets summarized the situation nicely in a note last week.

“The problem with repo continues to be that Basel 3 was designed to make balance sheet expensive, and the private money markets are growing increasingly illiquid as a result. In a recent post the NYFRB “Liberty Street” blog demonstrates the impact of the IOER cuts (to discourage reserves) as purely transitory; with repos and various other money market rates edging back towards—and even above—the top of the target range over and over.

Once again, we see that if efforts to push private cash into GC repo flows by lowering the IOER does not incentivize capital constrained primary dealers to keep rates in the target zone, then efforts to steepen the curve from the front with fed-funds cuts may be equally futile.

Even if they do get repo rates lower—perhaps by offering repo directly in the Standing Repo Facility (SRF), the problem will be keeping mid curve yields from falling even faster. The FX basis is driven primarily by short rate differentials, and lower LIBOR will reduce FX swap costs bringing hedged foreign buyers back into the US curve.”

Whereas in past cycles the FOMC limited “fine tuning” to the adjustment of key interest rates, since 2008 the Fed has attempted the impossible by trying to manage the entire yield curve.  The foray into quantitative easing or “QE” began this quixotic adventure, putting the Fed in the position of manipulating the entire term structure of interest rates via open market operations. We actually saw somebody suggest on Twitter last week that changing the rate of interest paid on excess reserves (IOER) actually “sterilizes” the runoff of the SOMA balance sheet.  Really?

Imagine the situation if the FOMC were to actually follow the advice of the howling mob of equity analysts and captive economists, cutting the FF target while continuing to run off the Fed balance sheet. The SOMA is currently shrinking at an 8% annual rate according to our friends at Grant’s Interest Rate Observer.  How far would the FOMC need to reduce the Fed funds rate to compensate for this relentless tightening of liquidity in the US banking system?  Try zero.

We all are left to ponder the conflict between momentary policy, on the one hand, and prudential policy on the other.  If the Fed were able to adjust Basel III and the other rules imposed upon banks since 2008 in order that they may prove their liquidity, there would be no need for an interest rate cut.  Indeed, looking at the chart below from FRED showing the 10-year Treasury note and the 30-year fixed mortgage from Freddie Mac, interest rates are near the low end of the range going back five years.

If we take the upward surge in US interest rates in 2016 following the election of Donald Trump and draw a line straight across to today, we have pretty much come full circle.  The difference is that since that time, the Fed has withdrawn hundreds of billions in liquidity from the system via QT, shrinking the deposit base of US banks dollar for dollar as securities owned by the Fed are redeemed by the Treasury.  Both the management of the Fed’s balance sheet and the liquidity rules that apply to US banks have actually been hurting economic growth.  One hand in Washington is working against the other.

Since 2008, the FOMC has been over-compensating with monetary policy to boost the economy and fight deflation.  Bank regulators, on the other hand, have been turning large banks into islands of liquidity that periodically cut off their clients to prove their ability to fund themselves in times of stress.  The market breakdown seen in December 2018 illustrates this conflict in rather graphic terms. The chart above show the $1.2 trillion decline in excess reserves since 2014.  Will the Fed repeat the December fiasco again this Fall?

The Fed was created a century ago to ensure a flexible currency system, yet the current conflict between monetary policy and prudential regulation of banks is a serious national problem.  It’s as though we have wound back the clock to 1907, when the Treasury and J.P. Morgan & Co were the only sources of liquidity to the US financial system in times of financial crisis. Today’s toxic mix of radical money policy and retrograde prudential regulation of bank liquidity is the functional equivalent of being back on the gold standard a century ago.

Jim Grant wrote in his classic 2014 book, “The Forgotten Depression: 1921: The Crash That Cured Itself,” of the Fed’s conflict of visions.

“The Federal Reserve Act was drafted in a world of peace and limited government. It was implemented in a world of war and statism. It was as if a central bank designed to function on Earth were somehow relocated to Mars.  Fixed exchange rates and free gold movement were the hallmarks of prewar monetary arrangements; the Federal Reserve had to adapt on the fly to untethered exchange rates and immobilized gold stocks.”

A century later, the US government is still struggling to get it right when it comes to providing a flexible currency to fuel the American dream.  Ask not whether we should cut the target for Fed funds.  Ask instead why liquidity is not moving through the US financial system in a prudent and reasonable fashion.

via ZeroHedge News https://ift.tt/2Z6c1HA Tyler Durden

Registered Sex Offender Weiner Moves Back In With Wife Huma Abedin And 7-Year-Old Son

Anthony Weiner has been a free man for a few months now, ever since he left a Bronx halfway house, and now it appears he’s moving back in with his wife, Hillary Clinton aide Huma Abedin, and their seven-year-old son Jordan.

The Daily Mail reported that the 54-year-old ex-Congressman and former mayoral candidate was seen rolling boxes and designer garment bags into Abedin’s home over the weekend. Weiner has never lived in the lower Manhattan apartment where Huma moved with their seven-year-old son Jordan soon after the disgraced politician went to prison. Abedin had filed for divorce, but has since withdrawn her petition, after the two parties decided to settle the issue privately. Abedin initially filed for divorce on the day Weiner entered his guilty plea for sexting a 15-year-old girl.

It’s not clear where Weiner had been staying since leaving his Bronx halfway house, where he was sent after spending 21 months in custody.

When he was leaving his halfway house in May, Weiner told reporters he hoped to get his family back and make up for lost time.  Weiner, who is a registered level one sex offender, said “I hope to be able to live a life of integrity and service, and I’m glad this chapter of my life is behind me.”

Weiner

Anthony Weiner moving his things

Since his release, Weiner has reportedly been pushing a marijuana business on potential investors, and shopping a book deal around.

The DM offered some amusing eye-witness details about an awkward encounter with Weiner at a coffeeshop.

A source told DailyMail.com of the meeting: “Weiner was advising the other man on how to approach investors and said, ‘”Tell them you have this great venture and then be like, I know the perfect guy’.”

“Weiner appeared to be referring to himself and explaining how to get other money on board but conceal his involvement.”

He told one potential investor that the “sexual stuff shouldn’t matter.” 

The “stuf” he referred to were explicit text messages he exchanged with a 15-year-old girl while he was married in September 2016.

Among them was one text which read: “I would bust that tight p***y so hard you would leak and limp for a week.”

He originally made contact with the girl on Twitter. 

But given the Congressman’s tainted reputation, we imagine a multimillion dollar book deal is his best shot at making a living comparable to what he enjoyed before his political career finished prematurely when Weiner accidentally tweeted a close-up shot of his bulging genitals.

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