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Authored by Charles Hugh Smith via OfTwoMinds blog,

If targeting political extremes generates the most profit, then that’s what these corporations will pursue.

As many of you know, oftwominds.com was falsely labeled propaganda by the propaganda operation known as ProporNot back in 2016. The Washington Post saw fit to promote ProporNot’s propaganda operation because it aligned with the newspaper’s view that any site that wasn’t pro-status quo was propaganda; the possibility of reasoned dissent has vanished into a void of warring accusations of propaganda and “fake news” –which is of course propaganda in action.

Now we discover that profit-maximizing data-mining (i.e. Facebook and Google) can–gasp–be used for selling ideologies, narratives and candidates just like dog food and laundry detergent. The more extreme and fixed the views and the closer the groups are in size (i.e. the closer any electoral contest), the more profitable the corporate data-mining becomes.

Meanwhile, back at the ranch, the data-mining gets all the important stuff wrong. As correspondent GFB explains, oftwominds.com was identified as “propaganda” by data-mining, which concluded that any site that posted content that wasn’t pro-Hillary was automatically propaganda:

At least we now know why your site was flagged as a source of Russian disinformation:

Cambridge Analytica is hired by the Russians to data mine to find the most efficacious targets for their disinformation campaign – and in the course of doing research, they find that a number of individuals who visit your site have shown – in other social media actions – to have anti-Hillary, or anti-powers-that-be tendency. They conclude the number of visitors that have that data profile would suggest that it is likely most, if not all visitors to your site would likely have the same view – and so any visitor to your site gets flagged to be targeted, if possible, by the disinformation campaign.

Now look at in reverse – someone who is investigating possible unscrupulous data mining re: the campaign, and through there own data mining notice that visitors to your site get an inordinate amount of targeted disinformation – – – and they conclude (incorrectly) that oftwominds.com is likely the source of that targeting.

Setting aside the quasi-monopoly on vast data-mining of users held by Facebook and Google, we have to ask: what sort of “democracy” do we end up with when data-mining ignores the “independent” middle/moderate voters in favor of the ends of the spectrum which can be more easily whipped up into a frenzy that might just lead to a few more votes being cast (Recall that voter participation in the US is abysmally low compared to other democracies.)

It also turns out that data-mining draws all sorts of false conclusions about individuals, groups and sites. For example, if you visit a “prepper” site then the algorithms will reckon you’re pro-gun ownership. If you visit the Sierra Club website, then you’re targeted as a “social liberal,” and so on.

But in the mad rush to monetize their vast trawling of user data, Facebook, Google et al., niceties such as accuracy and the undermining of civil society don’t matter: these are privately owned corporations whose only responsibility is to maximize profits for their owners and managers.

If targeting political extremes generates the most profit, then that’s what these corporations will pursue. It’s nothing personal–maximizing profit by any means available is why they exist.

Of related interest:

Facebook Is a Utility Which Can’t Charge Its Users (July 22, 2010)

How Much of our Discord Is the Result of the “Engagement” Advert Revenue Model of Social Media? (October 24, 2017)

Should Facebook, Google and Twitter Be Public Utilities? (March 5, 2018)

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My new book Money and Work Unchained is $9.95 for the Kindle ebook and $20 for the print edition. Read the first section for free in PDF format. If you found value in this content, please join me in seeking solutions by becoming a $1/month patron of my work via patreon.com.

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Google and Facebook are poised to see their combined share of the US advertising market fall for the first time this year, the Wall Street Journal reported Monday. But luckily for Alphabet shareholders, the tech behemoth is already looking at compensatory streams of revenue.

According to Reuters, in an unprecedented challenge to Amazon’s dominance of the e-commerce market, Google is teaming up with retailers like Target Corp., Walmart Inc., Home Depot Inc., Costco Wholesale Corp and Ulta Beauty Inc. to take a cut of their sales in exchange for facilitating sales by allowing retailers to list their products directly on Google’s search platform. Products will also appear on Google Express shopping service and the Google assistant for mobile phones and voice devices.

In exchange for Google touting their products and linking to their loyalty programs, the retailers will hand over a slice of every purchase to Google. The search giant has tried to convince brands that partnering with it is their only hope of beating back the threat posed by Amazon.

The pitch? Google is trying to convince brands that, by partnering with Google – and forking over a piece of their sales to Larry and Sergei – they will be able to exert greater influence over shoppers’ decisions. Perhaps the biggest utility, according to Google, is that customers will be able to make purchases using Google’s smart home assistant, granting them a toehold in the voice shopping market, what Reuters describes as “the next frontier for e-commerce.”

Google first got the idea for this new service after realizing that millions of customers were submitting image searches of products with questions like “where can I buy this?”

However, most of these searchers, Google discerned, ended in a purchase via Amazon.

The previously unreported initiative sprang from Google’s observation that tens of millions of consumers were sending image searches of products, asking “Where can I buy this?” “Where can I find it?” “How can I buy it?” “How do I transact?” Daniel Alegre, Google’s president for retail and shopping, told Reuters exclusively.

Over the past two years, mobile searches asking where to buy products soared by 85 percent, Alegre said.

But the current default choice for many consumers is a Google search that ends with an Amazon purchase, analysts said. The new Google program, Shopping Actions, will be available in the United States to retailers of all sizes and could help retail chains keep those customers.

“We have taken a fundamentally different approach from the likes of Amazon because we see ourselves as an enabler of retail,” Alegre said. “We see ourselves as part of a solution for retailers to be able to drive better transactions … and get closer to the consumer.” For consumers faced with a surfeit of choices, the idea is to make online buying easier by giving them a single shopping cart and instant checkout – a core feature of Amazon’s retail dominance.

Instead of buying the product off of Amazon, customers will be able to add items from a diverse array of brands to one consolidated Google shopping cart – just like how Amazon has its shopping cart. Retailers will also have the option of listing their products on Google Home’s voice shopping service.

For example, a shopper looking for sneakers on Google on his phone can see a retailer’s listing and add that to his Google Express cart. Later, the customer can stand in the kitchen, and use the Google Home voice device to add paper towels to the same cart and buy everything at once.

Retail partners saw the average size of a customer’s shopping basket increase by 30 percent, Alegre said, pointing to early results from the Shopping Actions program.

Ulta Beauty’s average order value has jumped 35 percent since partnering with Google, Chief Executive Officer Mary Dillon said. Ulta sells makeup and skin care products from brands such as MAC, Estee Lauder and Clinique.

Over the past six months, Target said the number of items in shoppers’ Google Express baskets have increased by nearly 20 percent, on average, as a result of its tie-up with the internet company.

Target and Wal-Mart have already agreed to list their products on the service as they seek to outmaneuver Amazon.

“Brands are looking at Google as the enemy of the enemy and that makes Google their friend,” said Guru Hariharan, CEO of retail technology firm Boomerang Commerce, referring to the competition between Amazon and chains like Walmart and Target.

Target shoppers “love the ease and convenience of making their Target run without lifting a finger by using a voice interface,” Chief Information and Digital Officer Mike McNamara said.

“This is just the beginning for Target and Google,” he added. Target shoppers will soon be able to link their online account and loyalty card with their Google accounts and get 5 percent off on purchases and free shipping, McNamara said.

But the implications for voice shopping shouldn’t be ignored.

Smart voice devices like Amazon Echo and Google Home will be installed in 55% of US homes by 2022, according to Juniper Research. Amazon’s Alexa platform could generate $10 billion in revenues by 2020, according to a report from RBC Capital Markets estimated.

The question now is: Is it too late for Google to mount a meaningful challenge to Amazon? Or will customers migrate to the new service?

* * *

Google, Amazon, and Facebook shares were lower as news about the falling advertising revenue – as well as outrage over Cambridge Analytica’s purported use of Facebook data – hammers shares lower.

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Authored by Ron Paul via The Ron Paul Institute for Peace & Prosperity,

President Trump’s recent cabinet shake-up looks to be a real boost to hard-line militarism and neo-conservatism. If his nominees to head the State Department and CIA are confirmed, we may well have moved closer to war.

Before being chosen by Trump to head up the CIA, Secretary of State nominee Mike Pompeo was one of the most pro-war Members of Congress. He has been militantly hostile toward Iran, and many times has erroneously claimed that Iran is the world’s number one state sponsor of terror. The truth is, Iran neither attacks nor threatens the United States.

At a time when President Trump appears set to make history by meeting North Korean leader Kim Jong-un face-to-face, Pompeo remains dedicated to a “regime change” policy that leads to war, not diplomacy and peace. He blames Iran – rather than the 2003 US invasion – for the ongoing disaster in Iraq. He enthusiastically embraced the Bush policy of “enhanced interrogation,” which the rest of us call “torture.”

Speaking of torture, even if some of the details of Trump’s CIA nominee Gina Haspel’s involvement in the torture of Abu Zubaydah are disputed, the mere fact that she helped develop an interrogation regimen that our own government admitted was torture, that she oversaw an infamous “black site” where torture took place, and that she covered up the evidence of her crimes should automatically disqualify her for further government service.

In a society that actually valued the rule of law, Haspel may be facing time in a much different kind of federal facility than CIA headquarters.

While it may be disappointing to see people like Mike Pompeo as Secretary of State and Gina Haspel as the head of the CIA, it shouldn’t be all that surprising. The few areas where President Trump’s actions are consistent with candidate Trump’s promises are ripping up the nuclear deal with Iran and embracing the torture policies of President George W. Bush. Candidate Trump in late 2015 promised to bring back waterboarding “and a whole lot worse” if he became president. It seems that is his intention with the elevation of Pompeo and Haspel to the most senior positions in his Administration.

We should be concerned, of course, but the real problem is not really Mike Pompeo or Gina Haspel. It is partly true that “personnel is policy,” but it’s more than just that. It matters less who fills the position of Secretary of State or CIA director when the real issue is that both federal agencies are routinely engaged in activities that are both unconstitutional and anti-American. It is the current Executive Branch over-reach that threatens our republic more than the individuals who fill positions in that Executive Branch. As long as Congress refuses to exercise its Constitutional authority and oversight obligations – especially in matters of war and peace – we will continue our slide toward authoritarianism, where the president becomes a kind of king who takes us to war whenever he wishes.

I am heartened to see some Senators – including Sen. Rand Paul – pledging to oppose President Trump’s nominees for State and CIA. Let’s hope many more join him – and let’s hope the rest of the Congress wakes up to its role as first among equals in our political system!

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Less than six months after exclaiming his concerns about algorithmic censorship on social media, and fears about becoming a ‘ministry of truth’… Alex Stamos, Facebook’s chief information security officer, is leaving the tech giant following “internal disagreements” over how the company should handle disinformation spread over its platform, according to the New York Times.

His departure was reportedly planned long before the Cambridge Analytica scandal erupted over the weekend.

Stamos famously unleashed a scathing tweet storm late last year warning the FBI and intrusive Democratic lawmakers (who are again banging the regulation drum) that “censorship is easy”, but separating Russian bots from legitimate posters would be much, much harder, and essentially would require Facebook or the government to become a “Ministry of Truth” – referring to a government ministry from George Orwell’s 1984 responsible for rewriting history.

“It’s very difficult to spot fake news and propaganda using just computer programs,” Stamos said in a series of Twitter posts on Saturday.

“Nobody of substance at the big companies thinks of algorithms as neutral,” Stamos wrote, adding that the media is simplifying the matter.

“Nobody is not aware of the risks.”

“So if you don’t worry about becoming the Ministry of Truth with ML systems trained on your personal biases, then it’s easy!“

Stamos, according to the NYT, had reportedly clashed with other senior executives over how the company should handle disclosures of “Russian interference” on its platform. Stamos called for more transparency and disclosure.

His repeated conflicts led to his day-to-day responsibilities being reassigned late last year in preparation for his departure – which wasn’t expected to happen until August.

After his day-to-day responsibilities were reassigned to others in December, Mr. Stamos said he would leave the company. He was persuaded to stay through August to oversee the transition of his duties because executives thought his departure would look bad, the current and former employees said. He has been overseeing the transfer of his security team to Facebook’s product and infrastructure divisions. His group, which once had 120 people, now has three, the current and former employees said.

Stamos is the first senior employee to leave the company since the controversy surrounding the purported $100,000 in fraudulent ad spending by a “Russian troll farm” was first publicly confirmed in September.

Facebook shares, which entered correction territory during Monday’s session, were down 1% after hours, back at the lows of the day…

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We first got a glimpse that not all is optimistic at Morgan Stanley on Sunday afternoon, when we reported that Michael Zezas, the bank’s chief US public policy strategist warned that unlike 2017, when the bank was bullish and cheerful, “something was different this year.” That something was that much of the upside from Trump’s tax reform is already priced in, and that, as Zezas said, “it feels less like ‘morning in America’ than ‘happy hour in America’. In that sense, we’re pushing back on the notion that US policy actions have meaningfully extended the market cycle, instead arguing that markets have already largely reflected, and are currently pricing in, the benefits they delivered.”

Worse, Morgan Stanley warned that “it is possible that spending on capex and wage growth will prevent a full pass-through, meaning 2018 earnings expectations may be too high.” Translation: the market is priced beyond perfection.

But if that piece was the preview, we got the main event this morning when Morgan Stanley’s chief US equity strategist Michael Wilson, who was already downcast  on the market for 2018, predicted that not only is the stock market meltup over, but worse, January may have marked the market top for the year.

“Back in January when stocks were rising sharply, we heard numerous calls for a “meltup” being made by prognosticators and investors. Of course, that’s how tops are made and we think January marked the top for sentiment, if not prices, for the year” said Wilson who echoed JPMorgan in pointing out that while retail may have made tentative steps to return to the market, “with volatility moving higher we think it will be difficult for institutional clients to gross up to or beyond the January peaks.”

So for those bulls who missed the furious buying scramble of late January, is there still a chance for a repeat performance? Not according to Wilson, who notes that “when we look at our internal data combined with industry flows and sentiment, we think there is a strong case that January was the melt-up, or at least the culmination of it.”

Furthermore, the brief blow off top which stunned everyone, including Jeremy Grantham who predicted a near-term meltup was imminent, wasn’t even that: Wilson says that he had “several clients tell us they think it was too brief a period to qualify as a proper melt up scenario; but we suggested January’s move was perhaps just a punctuation mark on a 59% rally in the S&P 500 from the February 2016 lows (26.6% annualized). In other words, by the time people are calling for a melt-up, it is basically over. Tax cuts were the event to capture investors’ imagination, but the reality is that the market had been pricing tax legislation in for months, if not quarters.”

Wilson uses two metrics to justify his call that “peak sentiment/positioning is behind us are” and that it’s all downhill from here.

First, he shows gross leverage by the bank’s hedge fund clients, which he believes is a good measure of investor willingness to assume risk. In January, this chart showed all time highs on a beta and delta adjusted basis. He also notes that “that this high was two years in the making aligning with our conclusion above that the melt up was almost done by the time it was being widely called for.”

The January top was also right before the February 5 volatility shock which is what forced clients to reduce the total risk they are holding to a more tolerable level, as shown below. And with volatility moving higher from the cycle low in January, “it will be very difficult for gross leverage to approach the old highs anytime soon.”

Second, Morgan Stanley also looks at the simplest measure of retail sentiment – the American Association of Individual Investors % Bulls – which Wilson likes “because there is a long history of data and the major peaks and troughs coincide with important market turning points.” As we showed previously, retail sentiment reached its most bullish – or rather euphoric – reading since 2010 in late January, and while it had not been a major turning point, it “did mark a pause in the velocity of the stock market recovery from the great recession.”

Of course, since no analyst leaves themselves without a hedging loophole, Wilson caveats that he doesn’t view this setup “as a smoking gun for a market top in price” but he does admit that it will mark a top in sentiment for quite awhile, “meaning it is unlikely retail will reach higher heights of excitement this year” concluding rhetorically “after all, what’s on the horizon that would get them more excited than a tax cut?”

In light of today’s market action which saw the market-leading tech sector finally crack, Wilson may be 2 out of 2, first calling the 2017 surge correctly, and now the drop.

Wilson wasn’t any more optimistic when looking at the broader economy. Echoing Zezas’ Sunday comments, Wilson said that “if we just roll forward the current bottom-up estimates, the forward earnings per share would be $166 and $170 by June 30 and September 30, respectively. That is approximately 3% and 5% higher than today’s $161. Not exciting, but not very bad either.”

“However, those numbers might need to come down if we start to see some evidence of lower margins since consensus forecasts assume no operating margin degradation. That is another reason why we think the S&P 500 makes its highs for the year this summer. It’s also a wild card that has big idiosyncratic risk at the stock level in our view.”

In other words, with the S&P closing just above 2,710, and below Morgan Stanley’s base case of 2,750, it is safe to say that in the next few weeks, the bank will shift its outlook to the bear case which sees the S&P sliding back down to 2,300.

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Having rejected a plan for imposing $30 billion in tariffs on Chinese imports last week, saying they weren’t big enough; President Trump is reportedly planning to unveil by Friday, a package of $60 billion in annual tariffs against China.

Trump is following through on a long-time threat that he says will punish China for intellectual property infringement and create more American jobs, and, as The Washington Post reports, the timing of the tariff package, which Trump plans to unveil by Friday, was confirmed by four senior administration officials.

The package could be applied to more than 100 products, which Trump argues were developed by using trade secrets the Chinese stole from U.S. companies or forced them to hand over in exchange for market access.

WaPo also notes that many of the financial ministers at the G-20 meeting have also alleged that China should make changes to its trade policies, but so far most have tried to cajole Beijing multilaterally, a strategy that Trump has said doesn’t work.

Trump this month announced 25 percent tariffs on imported steel and 10 percent for aluminum and they will also take effect Friday.

As Bloomberg reminds us, Canada and Mexico are already excluded from the levies, and the Trump administration has left the door open for Australia and possibly other allies to win a similar concession if they can show they are trading fairly and are national-security partners. Planned retaliation from the European Union to China has triggered concerns over a global trade war.

And as we warned previously, the recently announced global steel and aluminum tariffs (with various exemptions) by the Trump administration were just a (Section 232) preview of the main event: Trump’s imminent trade war with China, which as Credit Suisse previews, will be unveiled any moment in the form of tariffs and restrictions on trade with China, reportedly in retaliation for Chinese IP violations.

First, a reminder on the all-important Section 301:

• What is Section 301? Section 301 of the 1974 Trade Act allows the President to, among other things, “impose duties or other import restrictions on the products of [a] foreign country,” if the President determines that that country is violating a trade agreement or “engages in discriminatory or other acts or policies which are unjustifiable or unreasonable and which burden or restrict United States commerce.“ The U.S. relied heavily on the provision during the Reagan era (an administration in which the current USTR Robert Lighthizer served as Deputy USTR) into the early 1990s, but it has been used infrequently since the World Trade Organization was formed in 1995 and provided a forum for dispute resolution.

How will Section 301 figure in the upcoming US-Chinese trade war, and what are the key points:

• Last August, President Trump instructed his U.S. Trade Representative Robert Lighthizer to initiate a Section 301 investigation into China’s forced technology transfer policies.
• While the results of the 301 investigation are not due until August 2018, the President appears poised to act on the issue in the coming weeks.
• The President is reported to be seriously considering a package of tariffs on Chinese imports (targeting between $30BN and $60BN worth).
• Reports have stated that Administration officials have used China’s manufacturing roadmap, “Made in China 2025,” in deciding what goods to impose tariffs on. This will likely further concern Chinese leaders.
• In addition, the Administration has discussed rescinding licenses for Chinese businesses and employing other such methods to restrict Chinese investment in the United States. The President’s recent decision to block a Singaporean company’s bid to takeover a U.S. company underscores his aversion to Chinese direct investment (the company had Chinese affiliations).
• As part of the 301 action, the Administration has also reportedly discussed visa restrictions and a mandate that U.S. stock exchanges limit who can list in a U.S. market. It remains unclear whether the restrictions will go this far, but the President has, to date, been hawkish in his trade policy and there seem to be fewer and fewer moderating voices in the White House.
• The 301 investigation and potential actions resulting from it seem to complement congressional efforts to restrict Chinese investment through legislation broadening the jurisdiction of the Committee on Foreign Investment in the United States (CFIUS). We believe this legislation is on track to be signed into law in Q3 2018.

What to expect? here are some high-level thoughts from Credit Suisse:

• The Chinese will likely respond in kind, beginning a succession of tit-for-tat trade policies between the two countries.
• The United States has the option to take a multilateral approach and work with allied nations to initiate their own WTO dispute regarding Chinese technology transfer policies. However, at this point, the U.S. appears more likely to instead take unilateral retaliatory action without WTO authorization, which may run afoul of the U.S.’s WTO obligations.
• If the U.S. acts unilaterally (as it appears it will), China will likely bring a challenge before the World Trade Organization (WTO).
• The President appears committed to maintaining his “tough on China” stance. Even after losing top advisor Gary Cohn after the imposition of steel and aluminum tariffs, the President appears steadfast in his campaign against China’s trade practices and Chinese investment in the U.S, and we expect continued restrictive trade policies with respect to China.
• The President’s actions may not receive the congressional backlash that his steel and aluminum tariffs did. Many U.S. corporations are frustrated with China’s policy requiring foreign companies to turn over source code and other proprietary technology in exchange for access to the Chinese market. However, if the President takes this as far as he currently seems to be planning to, punitive measures by China coupled with the chilling of foreign investment could be a major concern for U.S. corporations.

In terms of specifics, the US trade deficit last year hit an all time high of $375BN.

The Trump administration is planning imposing tariffs on up to $60bn of Chinese goods, or roughly 13% of goods import from China ($505BN), and 2.75% of total US goods import according to Danske Bank; the tariffs will target tech products, telecoms & clothing.

A snapshot of the key aspect of the US-China trade relationship:

• the US exports soybeans, pharmaceuticals, vehicles and aircraft.
• the US imports textiles,clothing, manufactures of metals,electronics and toys.

How to trade it?

As noted last week, when discussing which industries and companies would be impacted, we said that there are some obvious sectors such as industrials (cars, planes), agriculture, and technology. Below, courtesy of Strategas,  is a list of US companies which derive the largest percentage of their total revenue from China. As trade war looms, it would be prudent for investors to start thinking about potential risks to the companies they own if they have sufficient business in China.

 

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Barely a day after President Trump outraged his political opponents by calling out Special Counsel Robert Mueller by name in a series of angry tweets, the Washington Post is reporting that the president’s legal team has provided written descriptions of certain key moments to the Mueller probe as they push to limit the scope of a presidential interview, should they agree to one.

According to the report, Trump has reportedly told aides that he’s “champing at the bit” to sit for an interview. But his lawyers, who are carefully negotiating terms, have sought to restrain the president, worried he might inadvertently perjure himself or – worse – accidentally walk into a perjury trap.

Given the time-sensitive nature of the investigation (Trump and his allies would like it to end as swiftly as possible) Trump on Monday added storied Washington lawyer Joseph diGenova, the husband of former Reagan Justice Department official and former Senate Intelligence Committee chief counsel Victoria Toensing, to his legal team.

While neither the special counsel nor the White House would comment on the report, lead attorney John Dowd said last week that the back-and-forth with Mueller had been “helpful.”

John Dowd, an attorney for the president, declined to comment on any records provided to the special counsel.

“We have very constructive, productive communications with the special counsel and his colleagues,” he said in an interview Friday.

“We’re blessed to have them,” Dowd said of the conversations with Mueller’s team. “I think it’s helpful to them and of course I think it’s very helpful to us.”

Written materials turned over include summaries of internal memos and correspondence between the president and senior officials. Lawyers with the special counsel’s office have said their questions fall into two separate categories:

The written materials provided to Mueller’s office include summaries of internal White House memos and contemporaneous correspondence about events Mueller is investigating, including the ousters of national security adviser Michael Flynn and FBI Director James B. Comey. The documents describe the White House players involved and the president’s actions.

Special counsel investigators have told Trump’s lawyers that their main questions about the president fall into two simple categories, the two people said: “What did he do?” and “What was he thinking when he did it?”

Trump’s lawyers expect Mueller’s team to ask whether Trump knew about Flynn’s communications with Russian Ambassador Sergey Kislyak during the presidential transition, for example, and what instructions, if any, the president gave Flynn about the contact, according to two advisers.

Trump said in February that he fired Flynn because he had misled Vice President Pence about his contact with Kislyak. He said he fired Comey because he had mishandled an investigation of Democratic presidential candidate Hillary Clinton.

The records do not include Trump’s personal version of events but provide a narrative of the White House view, the people said. Trump’s lawyers hope the evidence eliminates the need to ask the president about some episodes.

In recent weeks, there have been conflicting reports about the Mueller probe, with some suggesting that it could wind down over the coming weeks and months, while others hinted at a longer time frame.

However, these reports have largely omitted one crucial detail: The timeline of the probe largely depends on Trump.

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The FBI’s pro-Hillary, anti-Trump campaign has backfired dramatically, as one-by-one Trump seems to be draining the real swamp, most recently exemplified by what The Wall Street Journal Editorial Board, calls The McCabe March Madness…

For a microcosm of the current madness of American politics, look no further than the weekend meltdown after Attorney General Jeff Sessions fired former FBI deputy director Andrew McCabe late Friday.

Mr. Sessions acted on a recommendation by the FBI’s own Office of Professional Responsibility, but Democrats and the media ignored that and called the firing part of Donald Trump’s plot to undermine the FBI and steal American democracy.

Mr. Trump then seemingly tried to confirm the accusations with a Twitter fusillade hailing Mr. McCabe’s firing and escalating without cause to attack special counsel Robert Mueller. Which triggered another round of claims that Mr. Trump’s days in office are numbered, or should be.

As Mr. Trump and his antagonists drive each other insane, it’s hard to keep your eye on what matters.

Start with the obligation of FBI agents to tell the truth. Mr. Sessions’s statement was a straightforward explanation that he fired Mr. McCabe for a serious violation of duty.

The Justice Department’s Inspector General has been examining the department’s handling of the investigation of Hillary Clinton’s private email server – a probe demanded by Democrats on grounds that former FBI Director James Comey’s 2016 intervention cost her the election. The IG uncovered “allegations of misconduct” by Mr. McCabe, Mr. Sessions’s statement said, which it forwarded to the FBI’s Office of Professional Responsibility (OPR) that is composed of career officials.

Mr. Sessions added that both the IG and OPR reports “concluded that Mr. McCabe had made an unauthorized disclosure to the news media and lacked candor—including under oath—on multiple conclusions. The FBI expects every employee to adhere to the highest standards of honesty, integrity, and accountability. As the OPR proposal stated, ‘all FBI employees know that lacking candor under oath results in dismissal and that our integrity is our brand.’”

Ergo, Mr. McCabe had to be fired.

The IG’s report remains secret, and we hope it will become public shortly. But if Mr. Sessions’s summary is accurate, failing to fire Mr. McCabe would have been a terrible signal to the bureau’s agents.

Every agent at some point or another in a career is likely to testify in court. If a deputy director can get away with fudging answers, then every agent will assume he can too. The reference to “under oath” is also significant, since the FBI often charges people with the felony of making false statements without being under oath. The IG and OPR must have felt Mr. McCabe’s lack of candor was serious enough to warrant making him swear to tell the truth.

In response to his firing, Mr. McCabe said that “I answered questions truthfully and as accurately as I could amidst the chaos that surrounded me. And when I thought my answers were misunderstood, I contacted investigators to correct them.” He added that “to be accused of lacking candor when at worst I was distracted in the midst of chaotic events, is incredibly disappointing and unfair.”

The rest of his statement was devoted to blaming the OPR recommendation on Mr. Trump “and this Administration’s ongoing war on the FBI and the efforts of the Special Counsel investigation.” But Mr. McCabe knows that OPR lawyers aren’t Trump partisans and its director was appointed by Mr. Mueller when he was running the FBI in 2004.

All of which should have been cause for Mr. Trump to let the dismissal speak for itself, but the President is too self-involved for such restraint. Instead he tweeted on Saturday, “Andrew McCabe FIRED, a great day for the hard working men and women of the FBI – A great day for Democracy.”

He later blasted Mr. Comey, among others. And, for bad measure, his lawyer John Dowd suggested that Deputy Attorney General Rod Rosenstein should stop Mr. Mueller’s probe. Mr. Trump then attacked Mr. Mueller for hiring Democratic prosecutors.

Naturally, Mr. McCabe and his partisans let it be known that he had shared with Mr. Mueller memos that he had written after his meetings with Mr. Trump. Oh, and John Brennan, Barack Obama’s CIA director, tweeted in response to Mr. Trump’s tweet that, “When the full extent of your venality, moral turpitude, and political corruption becomes known, you will take your rightful place as a disgraced demagogue in the dustbin of history.”

Our politics really is debased when a former intelligence chief intimates that a President will be destroyed based on some information yet to be disclosed. Would he mind sharing what he knows on the record rather than leaking it to his press-corps pals? We’ve never believed in conspiracies about the “deep state,” but the not-so-subtle threats from Messrs. Brennan, Comey and McCabe will persuade many Trump voters that they and others are out to destroy the President no matter the truth.

The country should be waiting for the facts of the multiple investigations to come out and then make a political judgment. Instead the brawl over the 2016 election has become a blood feud in which the facts seem irrelevant.

This is going to get a lot uglier before it’s over.

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