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John Harrison at the University of Virginia School of Law has long been one of the preeminent conservative law professors in the country, and one of the leading constitutional scholars and legal historians; so when I saw his new aricle draft, Executive Power, I asked him to guest-blog about it, and he graciously agreed. I very much look forward to his posts.
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John Harrison at the University of Virginia School of Law has long been one of the preeminent conservative law professors in the country, and one of the leading constitutional scholars and legal historians; so when I saw his new aricle draft, Executive Power, I asked him to guest-blog about it, and he graciously agreed. I very much look forward to his posts.
from Latest – Reason.com https://ift.tt/2M22KfQ
via IFTTT
With the ongoing debacle over the 737 MAX seemingly getting worse by the day, a potentially far more ominous development hit today when rating agency Fitch warned that it may downgrade Boeing as the grounding of the ill-fated airplane stretches into the 5th month.
Citing regulatory uncertainty around the return to service of Boeing’s workhorse jet and the “growing logistical challenge” of getting parked planes back in the air, Fitch said Boeing’s credit rating was threatened as its cut its credit outlook for the aerospace giant while confirming its single-A, the sixth-highest investment-grade rating, and adding that there’s also a risk that the company will have to make costlier concessions to airlines.
The challenge for Boeing is not just how to get the grounded planes in the air; in the longer term, Fitch said the Max’s grounding presents a significant public-relations challenge that will remain a risk for “Boeing’s reputation and brand” into next year and beyond.
“Fitch also expects there will be a lingering operating-margin impact for several years after the 737 Max returns to service,” the ratings company said.
Boeing is currently rated A2 by Moody and A by S&P, which both have stable outlooks on the company, although we expect these to be cut soon now that Fitch has broken the seal. S&P said last week that Boeing’s announcement that it will be taking a $5.6 billion pretax charge to compensate for the grounding of the 737 Max wouldn’t affect the company’s credit ratings. But S&P warned that more damaging effects to Boeing’s financials or a “substantial loss” in market share to the 737 could warrant a downgrade.
While Boeing’s bonds were unchanged after Fitch’s report, BA stock dropped and since Boeing is the most important Dow member, the industrial average quickly slumped to session lows.
via ZeroHedge News https://ift.tt/2M6r3to Tyler Durden
Authored by Bryce Coward via Knowledge Leaders Capital blog,
When the US government gets near its statutory debt limit, congress must lift the debt limit in order for the Treasury to continue to issue debt to pay for government expenses. Simple enough. However, even after the debt limit is reached, the Treasury can use “extraordinary measures” so that the government can keep paying its various agencies and service providers. “Extraordinary measures” is really just the Treasury drawing down its checking account at the Fed, the same way an individual would draw down their checking account if they were between jobs.
The act of the Treasury drawing down its account at the Fed is kind of like a mini version of quantitative easing in that it adds liquidity to the system that otherwise would not have been there. So far the Treasury has drawn down its checking account at Fed by a cool $200bn since May, or $100bn per month.
On the flip side, when the debt ceiling impasse is finally settled, and it looks like that is going to happen any day now per Treasury Secretary Mnuchin’s comments, the Treasury will need to build back up its checking account balance at the Fed.
This means issuing enough debt over the next few months to not only cover ongoing expenses, but also enough to add back the $200bn it has withdrawn from its checking account so far. The extra issuance of debt is kind of like quantitative tightening in that it removes liquidity from the system.
I would suggest that removing liquidity from the system at a time when growth is likely to be slowing anyways, as we showed here, will add an extra layer of risk to liquidity sensitive assets over the next few months.
via ZeroHedge News https://ift.tt/2LBhWkG Tyler Durden
Former FBI Director James Comey has been under investigation for misleading President Trump – telling him in private that he wasn’t the target of an ongoing FBI probe, while refusing to admit to this in public.
According to RealClearInvestigations‘ Paul Sperry, “Justice Department Inspector General Michael Horowitz will file a report in September which contains evidence that Comey was misleading the president” while conducting an active investigation against him.
Even as he repeatedly assured Trump that he was not a target, the former director was secretly trying to build a conspiracy case against the president, while at times acting as an investigative agent. –RCI
According to two US officials familiar with Horowitz’s upcoming report on FBI misconduct, Comey was essentially “running a covert operation” against Trump – which began with a private “defensive briefing” shortly after the inauguration. RCI‘s sources say that Horowitz has pored over text messages between the FBI’s former top-brass and other communications suggesting that Comey was in fact conducting a “counterintelligence assessment” of the president during their January 2017 meeting in New York.
What’s more, Comey had an FBI agent in the White House who reported the activities of Trump and his aides, according to ‘other officials familiar with the matter.’
The agent, Anthony Ferrante, who specialized in cyber crime, left the White House around the same time Comey was fired and soon joined a security consulting firm, where he contracted with BuzzFeed to lead the news site’s efforts to verify the Steele dossier, in connection with a defamation lawsuit. -RCI
According to the report, Horowitz and his team have examined over 1 million documents and conducted over 100 interviews – including sit-downs with Comey and other current and former FBI and DOJ employees. “The period covering Comey’s activities is believed to run from early January 2017 to early May 2017, when Comey was fired and his deputy Andrew McCabe, as the acting FBI director, formally opened full counterintelligence and obstruction investigations of the president.”
McCabe’s deputy, Lisa Page, appeared to dissemble last year when asked in closed-door testimony before the House Judiciary Committee if Comey and other FBI brass discussed opening an obstruction case against Trump prior to his firing in May 2017. Initially, she flatly denied it, swearing: “Obstruction of justice was not a topic of conversation during the time frame you have described.” But then, after conferring with her FBI-assigned lawyer, she announced: “I need to take back my prior statement.” Page later conceded that there could have been at least “discussions about potential criminal activity” involving the president. -RCI
Comey coordination
Sperry notes that Comey wasn’t working in isolation on the Trump effort. In particular, Horowitz has looked at the January 6, 2017 briefing on the infamous ‘Steele Dossier’ – a meeting which was used by BuzzFeed, CNN and others to legitimize reporting on the dossier’s salacious and unsubstantiated claims.
Comey’s meeting with Trump took place one day after the FBI director met in the Oval Office with President Obama and Vice President Joe Biden to discuss how to brief Trump — a meeting attended by National Security Adviser Susan Rice, Homeland Security Secretary Jeh Johnson, Deputy Attorney General Sally Yates and National Intelligence Director James Clapper, who would soon go to work for CNN. -RCI
While Comey claims in his book, “A Higher Loyalty” that he didn’t have “a counterintelligence case file open on [Trump],” former federal prosecutor and National Review columnist Andrew McCarthy notes that just because Trump’s name wasn’t on a formal file or surveillance warrant doesn’t mean that he wasn’t under investigation.
“They were hoping to surveil him incidentally, and they were trying to make a case on him,” said McCarthy. “The real reason Comey did not want to repeat publicly the assurances he made to Trump privately is that these assurances were misleading. The FBI strung Trump along, telling him he was not a suspect while structuring the investigation in accordance with the reality that Trump was the main subject.”
What’s more, the FBI couldn’t treat Trump as a suspect – formally, as they didn’t have the legal grounds to do so according to former FBI counterintelligence lawyer Mark Wauck. “They had no probable cause against Trump himself for ‘collusion’ or espionage,” he said, adding “They were scrambling to come up with anything to hang a hat on, but had found nothing.”
What remains unclear is why Comey would take such extraordinary steps against a sitting president. The Mueller report concluded there was no basis for the Trump-Russia collusion conspiracy theories. Comey himself was an early skeptic of the Steele dossier — the opposition research memos paid for by Hillary Clinton’s campaign that were the road map of collusion theories – which he dismissed as “salacious and unverified.” -RCI
According to House Intelligence Committee Vice Chairman Devin Nunes (R-CA), Comey and the rest of the FBI’s top team (including Peter Strzok and Lisa Page) were attempting to “stop” Trump’s presidency for political reasons.
“You have the culmination of the ultimate spying, where you have the FBI director spying on the president, taking notes [and] illegally leaking those notes of classified information” to the MSM, said Nunes in a recent interview.
Read the rest of Sperry’s report here.
via ZeroHedge News https://ift.tt/2JXtCem Tyler Durden
Authored by Michael Snyder via The Economic Collapse blog,
The U.S. military is following many of the exact same patterns that we witnessed during our previous wars in the Middle East, and that even includes setting up shop at a key military base deep in the heart of the Arabian peninsula. After the U.S. invasion of Iraq in 2003, the U.S. military abandoned Prince Sultan Air Base in Saudi Arabia, but now they are back. Hundreds of U.S. troops are already there working hard to get the base operational, and as you will see below, a tremendous amount of new construction is planned. The base covers “well over a hundred square miles”, and so it has more than enough room to serve as a central hub for a new Middle East war.
Tensions with Iran have escalated dramatically over the past few weeks, but apparently somebody anticipated that the U.S. would need to use this base even before then, because according to NBC News U.S. troops were already arriving back in June…
In June the U.S. military began moving equipment and hundreds of troops back to a military base in Saudi Arabia that the U.S. deserted more than 15 years ago, according to two U.S. officials familiar with the deployment.
Over the coming weeks the deployment to Prince Sultan Air Base, intended to counter the threat from Iran, will grow to include fighter jets and Patriot long-range missile defense systems, the officials said. The Patriots have already arrived at the base and should be operational in mid-July, while the aircraft are expected to arrive in August.
And it turns out that the U.S. military has used this base during all of our previous wars in the Middle East.
For example, according to Air Force Magazine the U.S. military first occupied Prince Sultan Air Base for a few months during Operation Desert Storm…
The US Air Force first occupied the sprawling base in two frantic months from November 1990 to January 1991, then departed. Five years later, USAF and coalition forces moved back into the base. It quickly became a massive facility, home to a state-of-the-art air operations center and serving as the hub for air activity in the region.
Then later on, the base played a key role during the U.S. invasion of Afghanistan. The following comes from the Military Times…
Starting with the January 1991 air war against Iraq after its invasion of Kuwait the previous summer, the U.S. flew a wide range of aircraft from Prince Sultan air base, originally known as al-Kharj. Supported by an all-American array of creature comforts like fast-food restaurants and swimming pools, U.S. forces there flew and maintained Air Force fighters and other warplanes.
The base also served as a launch pad for the December 1998 bombing of Iraq, code-named Operation Desert Fox, which targeted sites believed to be associated with Iraq’s nuclear and missile programs. In 2001, the base became home to the U.S. military’s main air control organization, known as the Combined Air Operations Center, which orchestrated the air war in Afghanistan until it was relocated in 2003 to al-Udeid air base in Qatar.
But U.S. activity at the base didn’t reach a crescendo until Operation Iraqi Freedom in 2003. Here is more from Air Force Magazine…
Other delicate negotiations came down to the wire just before the start of Operation Iraqi Freedom. “We’ve had very productive meetings regarding military cooperation with Saudi Arabia in the event of military action against Iraq,” State Department official Richard Boucher announced Feb. 26, 2003.
That day, newspapers reported that the Saudis granted formal permission for PSAB to be used in the war against Saddam Hussein’s Iraq. Operation Iraqi Freedom began March 19.
Once again, PSAB pulled its weight in the air campaign. Fuel was a metric showing just how far PSAB had come since 1996. Prince Sultan Air Base operated at maximum rates during major combat operations in Operation Iraqi Freedom from March 19 to May 1, 2003. During that time, the 363rd Fuels Management Flight issued more than one million gallons per day. Officials had previously expanded the fuel storage capacity at Prince Sultan from two million to more than 15 million gallons.
So as you can see, every time the U.S. has decided to go to war in the Middle East, Prince Sultan Air Base has played a leading role.
And now after all this time we have suddenly returned.
This time around, it appears that the U.S. is planning for a very long stay. According to NBC News, existing roads and runways will be reinforced and expanded, and the U.S. military is even going to “build a medical facility”…
While Prince Sultan Air Base is an active facility, portions of the base will need an upgrade to accommodate the U.S. military, including reinforcing and expanding roads and runways, one U.S. official said. Base housing will also need updating, the official said, and the U.S. will build a medical facility. Many of the U.S. service members deployed there over the past few weeks are engineers preparing the base for the new mission.
Apparently whoever is in charge of making these sorts of decisions is not very optimistic about peace with Iran.
A tremendous amount of money and effort is required for a project like this, because it is basically the equivalent of putting up a small American city in the middle of nowhere. The base covers “well over a hundred square miles”, and all the way back in 2002 Wolf Blitzer called it “a little sliver of America in the middle of the Arabian Peninsula”…
“By the time the base complex was completed in 1999, it had cost the government of Saudi Arabia more than $1 billion and covered well over a hundred square miles,” found Air Force historian Daniel L. Haulman.
Food was also a priority. Baskin-Robbins ice cream set up shop as did other popular vendors such as Pizza Inn and Burger King. In time, the exchange provided a small haven of food, shopping, and diversion. “It’s a little sliver of America in the middle of the Arabian Peninsula,” enthused CNN’s war correspondent Wolf Blitzer, who visited the base in December 2002 as forces there prepared for intensifying action against Iraq.
I suppose that the Saudis want us to be as comfortable as possible if we are going to fight a war that will greatly benefit them.
After all, the Saudis and the Iranians have been engaged in a proxy war for many years, and so the Saudis would be absolutely thrilled to see the U.S. military bomb the living daylights out of them.
And Saudi Arabia’s minister of state for foreign affairs actually sounds quite eager for the action to start…
“Any attack on the freedom of navigation is a violation of international law,” Adel Aljubeir said in a Twitter post.
“Iran must realise its acts of intercepting ships, including most recently the British ship, are completely unacceptable. The world community must take action to deter such behaviour,” he added.
But as I discussed in a previous article, if the American people truly understood what a war against Iran would be like, there would be millions of protesters in Washington D.C. right now trying to stop it from happening. It would be a horrible, bloody, apocalyptic war that would set the entire Middle East ablaze, and it would set the stage for the sort of nightmare scenarios that I have been relentlessly warning about.
Unfortunately, so far only a very small portion of the U.S. population seems alarmed about any of this.
Meanwhile, the Pentagon is rapidly preparing for war, and Prince Sultan Air Base is now buzzing with U.S. military activity for the very first time since the invasion of Iraq.
via ZeroHedge News https://ift.tt/2Z4Rkf9 Tyler Durden
For years, the area around the Red Sea, the Bab al-Mandab strait and the Gulf of Aden was the preferred venue for maritime pirates – mostly of Somali and Yemeni origin – who had become the scourge of Suez-crossing tankers headed to and from the Persian Gulf, at least until a coordinated military response by US and regional navies successfully eradicated much of the local piracy threat. But as piracy off Africa’s east (and occasionally west) coast faded, a nest of pirates appears to have re-emerged in the highly trafficked Singapore Strait in the South China Sea.
It was there that pirates stormed and raided a South Korean-flagged cargo ship early on Monday, “stealing thousands of dollars in cash and even the sailors’ shoes” according to Reuters citing South Korean authorities.
Two people sustained minor injuries when seven pirates – who were armed with guns and knives – boarded the bulk carrier CK Bluebell and made off with $13,000 and belongings including mobile phones, clothes and shoes from the crew of 22, officials from the oceans and fisheries ministry said.
The dry bulk vessel CK Bluebell had set sail from its anchorage off Singapore on Saturday afternoon, heading northeast for South Korea’s port of Incheon, Marine Traffic ship tracking data showed.
Korean officials said the ship was sailing normally after the robbery.
“Seven pirates, including one carrying a gun and two armed with knives, got on board and assaulted the sailors for about 30 minutes,” an official at the Ministry of Maritime Affairs and Fisheries told the Yonhap news agency.
While the incident took place near the Singapore Strait, a busy sea lane that runs past Indonesia, Malaysia and Singapore, Singapore’s Maritime and Port Authority (MPA) said the incident did not take place in city-state’s waters.
“The MPA was informed by the Korea Coast Guard that it took place in the South China Sea near Anambas Islands,” a spokesman said.
The pirate attack takes place after China’s Ministry of Transport raised its security recommendation for Chinese vessels in the nearby Malacca Strait, between the Malay peninsula and the Indonesian island of Sumatra earlier this month.
A Chinese official declined to specify the reason for the new security level, saying only that the decision was the result of comprehensive research taking into account all factors.
While tougher policing on the route has made piracy less frequent on the strategic shipping route in recent years – similar to the decline in piracy off Africa’s coastline – piracy has seen an increase on the world’s seas, with the International Chamber of Commerce recording 201 incidents of maritime piracy and armed robbery in 2018, up from 180 in 2017.
The South China Sea is home to vital shipping lanes, but in recent years has also become a flashpoint for tensions between China and several regional nations which have overlapping claims over islands and reefs.
via ZeroHedge News https://ift.tt/2M6AKrA Tyler Durden
Many thanks to Eugene and the gang for letting me write for the Conspiracy. I have been a longtime reader, and it is an honor to join the roll. Now, down to business.
In two previous posts, Randy Barnett and I explained that NFIB v. Sebelius already resolved two of the most important questions in Texas. First, Chief Justice Roberts’s NFIB decision already held that the individual mandate, standing by itself, creates an injury-in-fact. Second, Chief Justice Roberts’s NFIB decision already held that the individual mandate, standing by itself, is unconstitutional.
In this post, and two others, I will analyze oral arguments, which were held on July 9 before a three-judge panel: Judges Jennifer Walker Elrod, Kurt D. Engelhardt, and Carolyn Dineen King. You can listen here:
This first post will focus on standing.
Randy and I have explained that the basis for standing in NFIB was the pocketbook injury imposed by the individual mandate on two private plaintiffs. That is, they had to purchase insurance they did not want. The penalty, which did not even go into effect until 2014, could not have played a role in the NFIB standing inquiry. This position was clarified during oral arguments. Justice Kagan asked now-Judge Greg Katsas, the lawyer for NFIB, whether people who were subject to the mandate, but not the penalty would have standing.
Justice Kagan: Mr. Katsas, do you think a person who is subject to the mandate but not subject to the penalty would have standing?
Under the ACA’s original design, some people would be subject to the mandate, but were exempted from the penalty. Katsas replied that they would be injured:
Mr. Katsas: Yes, I think that person would, because that person is injured by compliance with the mandate.
Justice Kagan: What would that look like? What would the argument be as to what the injury was?
Mr. Katsas: The injury—when that person is subject to the mandate, that person is required to purchase health insurance. That is a forced acquisition of an unwanted good. It’s a classic pocketbook injury.
During oral argument in the 5th Circuit, Judge Elrod posed a similar question to the question posed by Justice Kagan seven years earlier. I have transcribed the following exchange between Judge Elrod and Robert Henneke, the lawyer for the private plaintiffs. (I cleaned up some cross-talk, made my best guess at inaudible words, and added clarifying comments in brackets.) The colloquy begins at 1:25:14.
Henneke: The ACA contemplates that the individual mandate carries the force of a command, because [certain] categories of persons are subject to it, without the penalty.
Judge Elrod: Those people have standing, even if they were buying insurance, if they were in one of those exempted categories. Like back at the time of the original argument, I believe Justice Kagan asked a question about that. Whether or not people who don’t have to pay the penalty automatically were exempt, would they have standing?
Judge Elrod is exactly right. The Tax Cuts and Jobs Act of 2017 made the penalty $0 for everyone who was subject to the mandate. But, the Affordable Care Act of 2010 set the penalty for $0 for some people who were still subject to the mandate. And they too would have been injured.
Rob Henneke explored this point further:
Henneke: There is a similar command there. It’s a great point you bring up your honor. I want to go back to the history of NFIB. And address the appellant’s argument that my clients’ harm is self-inflicted. This was resolved in the case history of NFIB. Your honor will recall in NFIB the shared responsibility payment … was not effective until 2014. NFIB was [decided in] 2012. The sole basis for the NFIB individual plaintiffs as set forth in their declarations was the individual mandate. Not the penalty. And in denying the government’s Motion to Dismiss on standing, the NFIB trial court, as did Judge O’Connor, correctly held that the individuals had an injury. This argument was carried through the 11th circuit and all the way to the supreme court where it was addressed during the 1st day of oral argument, in questions from both the Chief Justice and Justice Kagan.
Henneke then read from the colloquy between Justice Kagan and Greg Katsas from 2012. To be sure, NFIB did not address the basis for standing. Judge Elrod flagged this point:
Elrod: What do you say to those who might say, well, they argued that, but the Court didn’t actually make a standing [holding], maybe it could be considered driveby standing? Some people use that colloquial term. While there might be questions on a topic, may we ask in our court, questions today, but it doesn’t mean we’ve answered question a certain way.
Henneke replied:
Henneke: We can say with certainty that the Supreme Court in NFIB did proceed forward to resolve the merits of the case. It is implicit it was resolving this question of the individual plaintiff standing in the affirmative by reaching the merits, after addressing this during oral argument. And I think the trial court again correctly did so here. So I see if you look at the case history of NFIB, that this is ground that is well covered, that individual plaintiffs standing has been addressed and resolved.
I agree. The only way for Chief Justice Roberts to have reached the merits, was if the private plaintiffs had standing. And the only basis for standing in 2012 was the mandate, not the penalty which would be assessed in 2014.
The Department of Justice agreed on this point. August E. Flentje argued for the federal government. He explained at 1:10:48:
Flentje: We think the individual plaintiffs have standing here based on the combined impact of the mandate, which requires them to buy insurance and the insurance reforms which ensure that the insurance they must buy is unsatisfactory. That is an injury that is sufficient for district court jurisdiction for this court’s jurisdiction and to evaluate the merits.
Call it “driveby standing,” or whatever you like, but this simple aspect of NFIB is enough to resolve the injury-in-fact question in Texas.
I do need to address an allegation concerning the two private Plaintiffs in Texas, John Nantz and Neill Hurley. Recently, an article in Healthcare Dive suggested that the case may be moot. Why? During a press call, a reporter from Healthcare Dive asked Robert Henneke if Nantz and Hurley were still enrolled in ACA plans. According to the reporter, Henneke replied, “I’m going to respect the privacy of my clients by not discussing in any more detail their current health situation or current access to care or insurance.” From this statement, the article suggested that the case may be moot.
This charge is extremely serious. If in fact Nantz and Hurley are no longer subject to the mandate, that Rob Henneke brazenly lied to the Fifth Circuit. He could not credibly claim that they were injured if they were now insured. Any suggestion of mootness would be based entirely on speculation, and on the allegation that an officer of the court lied to the Fifth Circuit. If there is any evidence, the intervenors should bring it forward. Henneke’s refusal to answer the question doesn’t cut it.
Indeed, lawyers have no duty to answer any questions from the press–even on a press call designed to help their clients’ case. Lawyers do have a duty to protect the confidences of their client–especially in this sort of high-stakes litigation. I pose a question for the practicing attorneys reading this post: if a reporter called you after an oral argument, and asked for facts about your clients beyond those stated in the record, what would you do? I expect the answer would be the same for most competent lawyers: “No comment, please refer to the pleadings.”
A lawyer’s refusal to answer questions about his client, and nothing more, does not provide even the faintest basis for a suggestion of mootness. Attorneys have a duty to apprise the court of changes in their clients status–especially when that change affects the court’s jurisdiction.
If history is any guide, these two individuals will be hounded by the press, at every juncture, to determine whether in fact they remain subject to the mandate. I wrote about this sort of press scrutiny in Unraveled. During the run-up to King v. Burwell, reporters camped outside the home of the plaintiffs. Mike Carvin, who represented the Plaintiffs, told me, that the “press was harassing these poor people.” Henneke no doubt wants to protect his clients from such harassment.
In King v. Burwell, Solicitor General Verrilli chose not push the issue. Here is the excerpt from Unraveled (p. 380):
After Carvin explained that each of the four plaintiffs has standing, Justice Ginsburg finished her questioning: “I don’t want to detain you on this any more but I will ask the government what their position is on standing.” Later Justice Alito joked, “Should we have a trial here on this issue and find what the facts are?” Appellate courts are not supposed to find new facts, but rather must stick with the record developed in the lower courts. . . .
Solicitor General Verrilli did not ask the Court to dismiss the case due to a lack of standing. Because Carvin represented that at least one Virginian had standing, Verrilli would “infer that at least one of the [Plaintiffs] has standing.” With respect to standing, a senior DOJ official told me the government’s position was very carefully thought through, it wasn’t just winging it up there. Unless we have proof that that one person didn’t make the requisite income to trigger the obligation to purchase insurance, then we did not have the basis for objecting to standing. More specifically, the Solicitor General’s Office deemed Mike Carvin a person of integrity who understood the rules. If he wasn’t making a representation that anything has changed from the plaintiffs’ affidavits, then we have to assume that at least one person has standing. With standing out of the way, the advocates could move on to the merits.
Unless and until Henneke makes a representation that something changed from the affidavits, there is no basis to suggest otherwise.
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Many thanks to Eugene and the gang for letting me write for the Conspiracy. I have been a longtime reader, and it is an honor to join the roll. Now, down to business.
In two previous posts, Randy Barnett and I explained that NFIB v. Sebelius already resolved two of the most important questions in Texas. First, Chief Justice Roberts’s NFIB decision already held that the individual mandate, standing by itself, creates an injury-in-fact. Second, Chief Justice Roberts’s NFIB decision already held that the individual mandate, standing by itself, is unconstitutional.
In this post, and two others, I will analyze oral arguments, which were held on July 9 before a three-judge panel: Judges Jennifer Walker Elrod, Kurt D. Engelhardt, and Carolyn Dineen King. You can listen here:
This first post will focus on standing.
Randy and I have explained that the basis for standing in NFIB was the pocketbook injury imposed by the individual mandate on two private plaintiffs. That is, they had to purchase insurance they did not want. The penalty, which did not even go into effect until 2014, could not have played a role in the NFIB standing inquiry. This position was clarified during oral arguments. Justice Kagan asked now-Judge Greg Katsas, the lawyer for NFIB, whether people who were subject to the mandate, but not the penalty would have standing.
Justice Kagan: Mr. Katsas, do you think a person who is subject to the mandate but not subject to the penalty would have standing?
Under the ACA’s original design, some people would be subject to the mandate, but were exempted from the penalty. Katsas replied that they would be injured:
Mr. Katsas: Yes, I think that person would, because that person is injured by compliance with the mandate.
Justice Kagan: What would that look like? What would the argument be as to what the injury was?
Mr. Katsas: The injury—when that person is subject to the mandate, that person is required to purchase health insurance. That is a forced acquisition of an unwanted good. It’s a classic pocketbook injury.
During oral argument in the 5th Circuit, Judge Elrod posed a similar question to the question posed by Justice Kagan seven years earlier. I have transcribed the following exchange between Judge Elrod and Robert Henneke, the lawyer for the private plaintiffs. (I cleaned up some cross-talk, made my best guess at inaudible words, and added clarifying comments in brackets.) The colloquy begins at 1:25:14.
Henneke: The ACA contemplates that the individual mandate carries the force of a command, because [certain] categories of persons are subject to it, without the penalty.
Judge Elrod: Those people have standing, even if they were buying insurance, if they were in one of those exempted categories. Like back at the time of the original argument, I believe Justice Kagan asked a question about that. Whether or not people who don’t have to pay the penalty automatically were exempt, would they have standing?
Judge Elrod is exactly right. The Tax Cuts and Jobs Act of 2017 made the penalty $0 for everyone who was subject to the mandate. But, the Affordable Care Act of 2010 set the penalty for $0 for some people who were still subject to the mandate. And they too would have been injured.
Rob Henneke explored this point further:
Henneke: There is a similar command there. It’s a great point you bring up your honor. I want to go back to the history of NFIB. And address the appellant’s argument that my clients’ harm is self-inflicted. This was resolved in the case history of NFIB. Your honor will recall in NFIB the shared responsibility payment … was not effective until 2014. NFIB was [decided in] 2012. The sole basis for the NFIB individual plaintiffs as set forth in their declarations was the individual mandate. Not the penalty. And in denying the government’s Motion to Dismiss on standing, the NFIB trial court, as did Judge O’Connor, correctly held that the individuals had an injury. This argument was carried through the 11th circuit and all the way to the supreme court where it was addressed during the 1st day of oral argument, in questions from both the Chief Justice and Justice Kagan.
Henneke then read from the colloquy between Justice Kagan and Greg Katsas from 2012. To be sure, NFIB did not address the basis for standing. Judge Elrod flagged this point:
Elrod: What do you say to those who might say, well, they argued that, but the Court didn’t actually make a standing [holding], maybe it could be considered driveby standing? Some people use that colloquial term. While there might be questions on a topic, may we ask in our court, questions today, but it doesn’t mean we’ve answered question a certain way.
Henneke replied:
Henneke: We can say with certainty that the Supreme Court in NFIB did proceed forward to resolve the merits of the case. It is implicit it was resolving this question of the individual plaintiff standing in the affirmative by reaching the merits, after addressing this during oral argument. And I think the trial court again correctly did so here. So I see if you look at the case history of NFIB, that this is ground that is well covered, that individual plaintiffs standing has been addressed and resolved.
I agree. The only way for Chief Justice Roberts to have reached the merits, was if the private plaintiffs had standing. And the only basis for standing in 2012 was the mandate, not the penalty which would be assessed in 2014.
The Department of Justice agreed on this point. August E. Flentje argued for the federal government. He explained at 1:10:48:
Flentje: We think the individual plaintiffs have standing here based on the combined impact of the mandate, which requires them to buy insurance and the insurance reforms which ensure that the insurance they must buy is unsatisfactory. That is an injury that is sufficient for district court jurisdiction for this court’s jurisdiction and to evaluate the merits.
Call it “driveby standing,” or whatever you like, but this simple aspect of NFIB is enough to resolve the injury-in-fact question in Texas.
I do need to address an allegation concerning the two private Plaintiffs in Texas, John Nantz and Neill Hurley. Recently, an article in Healthcare Dive suggested that the case may be moot. Why? During a press call, a reporter from Healthcare Dive asked Robert Henneke if Nantz and Hurley were still enrolled in ACA plans. According to the reporter, Henneke replied, “I’m going to respect the privacy of my clients by not discussing in any more detail their current health situation or current access to care or insurance.” From this statement, the article suggested that the case may be moot.
This charge is extremely serious. If in fact Nantz and Hurley are no longer subject to the mandate, that Rob Henneke brazenly lied to the Fifth Circuit. He could not credibly claim that they were injured if they were now insured. Any suggestion of mootness would be based entirely on speculation, and on the allegation that an officer of the court lied to the Fifth Circuit. If there is any evidence, the intervenors should bring it forward. Henneke’s refusal to answer the question doesn’t cut it.
Indeed, lawyers have no duty to answer any questions from the press–even on a press call designed to help their clients’ case. Lawyers do have a duty to protect the confidences of their client–especially in this sort of high-stakes litigation. I pose a question for the practicing attorneys reading this post: if a reporter called you after an oral argument, and asked for facts about your clients beyond those stated in the record, what would you do? I expect the answer would be the same for most competent lawyers: “No comment, please refer to the pleadings.”
A lawyer’s refusal to answer questions about his client, and nothing more, does not provide even the faintest basis for a suggestion of mootness. Attorneys have a duty to apprise the court of changes in their clients status–especially when that change affects the court’s jurisdiction.
If history is any guide, these two individuals will be hounded by the press, at every juncture, to determine whether in fact they remain subject to the mandate. I wrote about this sort of press scrutiny in Unraveled. During the run-up to King v. Burwell, reporters camped outside the home of the plaintiffs. Mike Carvin, who represented the Plaintiffs, told me, that the “press was harassing these poor people.” Henneke no doubt wants to protect his clients from such harassment.
In King v. Burwell, Solicitor General Verrilli chose not push the issue. Here is the excerpt from Unraveled (p. 380):
After Carvin explained that each of the four plaintiffs has standing, Justice Ginsburg finished her questioning: “I don’t want to detain you on this any more but I will ask the government what their position is on standing.” Later Justice Alito joked, “Should we have a trial here on this issue and find what the facts are?” Appellate courts are not supposed to find new facts, but rather must stick with the record developed in the lower courts. . . .
Solicitor General Verrilli did not ask the Court to dismiss the case due to a lack of standing. Because Carvin represented that at least one Virginian had standing, Verrilli would “infer that at least one of the [Plaintiffs] has standing.” With respect to standing, a senior DOJ official told me the government’s position was very carefully thought through, it wasn’t just winging it up there. Unless we have proof that that one person didn’t make the requisite income to trigger the obligation to purchase insurance, then we did not have the basis for objecting to standing. More specifically, the Solicitor General’s Office deemed Mike Carvin a person of integrity who understood the rules. If he wasn’t making a representation that anything has changed from the plaintiffs’ affidavits, then we have to assume that at least one person has standing. With standing out of the way, the advocates could move on to the merits.
Unless and until Henneke makes a representation that something changed from the affidavits, there is no basis to suggest otherwise.
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US equity markets and bond yields are rising after Bloomberg reports, according to a person briefed on the discussions, that Congress and the White House are finalizing an agreement that would raise the debt limit until July 2021 and increase government spending for two years.
However, the short-term Bill curve remains ‘kinked’ around the debt-ceiling X-date for now…
Time is running short for the House to vote on the deal before they leave for a six-week recess on July 26.
If the budget negotiations can’t be concluded in time, lawmakers may decide to pass a debt ceiling extension into October. That would avoid the risk of a default in the short-term but would extend uncertainty for markets.
via ZeroHedge News https://ift.tt/2Z0aMtr Tyler Durden
