Guns and Guitars

minisgunsandguitarsYoutube

Two years ago, I scored a 2006 Fender Telecaster that needed new paint and new frets. Paying an experienced luthier to do the work would’ve cost twice as much as the guitar, so I decided to do it myself with the assistance of Daniel Thompson’s Guns and Guitars channel on YouTube.

Thompson’s pitch is that relatively handy people can modify their own guitars (and guns) using inexpensive, simple, and sometimes homemade tools. The focus on thrift and utility over prestige and features makes Guns and Guitars the perfect resource for neophytes who don’t want to spend just as much (or more) on equipment as they would on an expert’s help.

If Thompson can’t show you how to make a functional tool out of scrap, he’ll advocate the cheapest one that will produce the best results—the perfect ethos for uncertain times.

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China Officially Charges Two Detained Canadians With Espionage

China Officially Charges Two Detained Canadians With Espionage

Tyler Durden

Fri, 06/19/2020 – 06:20

More than 18 months have passed since Michael Kovrig, a former Canadian diplomat working for an NGO on the mainland, and Michael Spavor, a Canadian businessman specializing in running novelty tours to North Korea, were abruptly arrested by police in China and informed they were under investigation (in China, police can take you into custody before the investigation even begins) for threatening China’s national security – an extremely serious charge.

Since then, the two men have been confined to Chinese prisons, denied contact with their families, and have had only minimal contact with Canadian diplomats. Their arrests were widely seen as retaliation for the arrest of Huawei CFO Meng Wanzhou in Vancouver, which occurred just days before Kovrig, the first of three Canadians to be apprehended (one was later released) disappeared.

Since their arrest, Kovrig and Spavor have been held in solitary confinement and subjected sometimes brutal interrogations, according to people familiar with their cases. Before the pandemic, each man had been allowed visits with consular officials, but those were suspended months ago.

On Friday, the two men were formally indicted on espionage charges, suggesting that, if Canada doesn’t simply allow Meng to walk free, both may be facing lengthy prison terms in China. Or even the possibility of execution. Canada has denounced their arrests as arbitrary and accused Beijing of using these two men as political pawns in retaliation for the arrest of Meng, who is facing extradition to the US.

Both men have been accused of “spying on national secrets” and sharing intelligence with “outside entities.” China’s court system is completely controlled by the CCP and has an almost 100% conviction rate once charges are handed down, according to the BBC.

The case has deeply strained relations between the two countries, and this latest decision will likely cause relations between Beijing and Ottawa to deteriorate even further.

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Italy Once Again On The Eurozone Worry List

Italy Once Again On The Eurozone Worry List

Tyler Durden

Fri, 06/19/2020 – 05:00

Authored by Nick Corbishley via WolfStreet.com,

Over half of Italian companies reported facing a liquidity shortfall by the end of 2020 and 38% reported “operational and sustainability risks,” according to a survey of 90,000 companies conducted by Italy’s national statistics institute ISTAT.

The national Italian business lobby, Confcommercio, recently estimated that 60% of restaurants and other businesses were short on liquidity and 30% had complained about the extra costs of implementing anti-contagion safety measures so they can start serving customers after lockdown.

The tourism industry, which accounts for 13% of GDP and has been crucial in keeping Italy’s economy afloat over the past decade, providing jobs for an estimated 4.2 million people, is in post-lockdown limbo. The borders have opened but foreign tourists still remain elusive. And with many local residents in no financial position to go on holiday this year, domestic demand is unlikely to pick up as much of the slack as tourism businesses are desperately hoping.

Tourism was one of the few parts of the economy that has been growing in recent years. Last year, for instance, it grew by 2.8% while Italy’s industrial output shrank by 2.4%. In an economy that hasn’t grown for well over 10 years while public debt continues to grow at a frightening rate, its fastest growing sector has just been hit with the mother of all sledgehammers.

Italy’s manufacturing industry, which was already struggling before the crisis, is also in trouble. In April, when Italy was in the grip of one of the most severe lockdowns in Europe, ISTAT’s industrial turnover index plunged by 46.9% while the unadjusted industrial new orders index fell by 49.0% with respect to the same month of the previous year. Since then, many businesses have reopened but activity remains low.

To weather the lull, many companies need credit. But this is easier said than done in Italy, unless you’re a multi-billion dollar company. Car giant Fiat Chrysler is on the verge of being granted a €6.3 billion state-backed loan — more than any other European carmaker. Even Atlantia, the firm that operated and maintained the Morandi Bridge in Genoa that collapsed in 2018, resulting in 43 fatalities, is hoping to hit up the government for a €1.7 billion loan.

Meanwhile, hundreds of thousands of small businesses continue to wait. In the early days of the crisis the Conti government said that debt guarantees would be made available to unlock up to €740 billion in funding for businesses. Yet by May 20, just 301,777 of 607,391 requests for assistance had been granted, according to a report by Italy’s bicameral investigative commission. (An accepted request doesn’t mean a loan has actually been dispensed).

For those companies that fall through the cracks of Italy’s emergency loan system, many of which were functioning perfectly well before the coronavirus crisis, the temptation is to go cap in hand to mafia-affiliated loan sharks, who are more than happy to help out. In Calabria the Ndrangheta “initially come in with offers of low interest rates, because their end goal is to take over the business, via usury, and use it to launder their illicit proceeds,” says Public Prosecutor Nicola Gratteri.

Even before this crisis began, Italy’s half-broken banking system and endless morass of red tape made getting a business bank loan an almost impossible task — apart from for the legions of zombie firms that already owed banks huge amounts of debt they will never repay and which would periodically get restructured. In the last crisis the share of the industry capital stock sunk in zombie firms more than doubled, from 7% to 19% between 2007 and 2013, according to the OECD. Something similar, but on an even larger scale, is likely to happen by the end of this crisis.

And that is the last thing that Italy’s economy and banking system need. Despite a massive clean-up effort in recent years, non-performing loans (NPLs) still account for 7% of Italy’s total loans, one of the highest ratios in Europe. That’s down from almost 17% five years ago, thanks to the mass securitization of Italian NPLs. Investors in these securitized NPLs expected to earn their return based largely on the proceeds from the sale of the underlying collateral.

The process of securitization depended on two basic conditions that are now in question:

1. investors’ willingness to invest in sliced and diced toxic debt a la Italiana; and

2. the ability of debt collectors to recover and sell the underlying assets.

The lockdown made condition 2 virtually impossible. Courts were closed. The Italian housing market, where the collateral for housing-related loans would have to be sold, was brought to a standstill. And debt collectors were unable to reach borrowers to negotiate even partial payments on unpaid loans.

If collections in Italy keep falling, the income generated might not be enough to pay the investors that bought the securitized non-performing loans. In that case, according to the Wall Street Journal, investors in the mezzanine and junior securities would lose their investments and Italy’s already financially challenged government, which guaranteed the senior securities to make the deals attractive, would have to foot some of the bill.

Italy’s banking system will soon be engulfed by a new wave of non-performing loans as legions of companies, households, and individuals default on their debt during the post-lockdown era. When that happens and NPL ratios in Italy’s banking sector soar well into double figures again, just as the market for securitized Italian NPLs begins to crumble, Italy’s banking system will not only be back where it was circa 2015, it will be in an even worse place.

The Italian government is already in fiscal tightspot. By the end of this year its debt will already have surged to around 155%-160% of GDP, from last year’s 136% — the result of three simultaneous processes: massive growth in government spending to counter the virus crisis, a dizzying slump in tax revenues, and a sharp decline in GDP.

If Italy’s government is unable to deal with the approaching tsunami of bad debt, external help will soon be needed. Other Eurozone members will be in the same boat, which is why the ECB is quietly talking about creating a bad bank to “warehouse” hundreds of billions of euros of unpaid debt. Getting the blessing of some Northern European countries, particularly Germany, for the scheme will be a tough task, especially given the current standoff between the German Constitutional Court and the ECB. But for Italy’s economy, time is of the utmost essence.

*  *  *

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Brickbat: Isn’t This How World War II Started?

polishczechflags_1161x653

The Polish government admits its troops briefly invaded and occupied part of the Czech Republic but says it was all a “misunderstanding.” A Czech government official explained, “Polish soldiers mistakenly deterred our citizens from entering a church on the Czech territory in close vicinity of the Czech-Polish borders.” The Polish government says troops aiding its border guard simply set up a guard station in the wrong location. Both sides say the matter was quickly resolved and there are no hard feelings.

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Brickbat: Isn’t This How World War II Started?

polishczechflags_1161x653

The Polish government admits its troops briefly invaded and occupied part of the Czech Republic but says it was all a “misunderstanding.” A Czech government official explained, “Polish soldiers mistakenly deterred our citizens from entering a church on the Czech territory in close vicinity of the Czech-Polish borders.” The Polish government says troops aiding its border guard simply set up a guard station in the wrong location. Both sides say the matter was quickly resolved and there are no hard feelings.

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NATO To Probe French & Turkish Warships Near Clash Incident Off Libya

NATO To Probe French & Turkish Warships Near Clash Incident Off Libya

Tyler Durden

Fri, 06/19/2020 – 04:15

Perhaps predictably given Erdogan’s increased threats and foreign adventurism, cracks loom in the NATO alliance over Libya, leading to an official probe by Secretary-General Jens Stoltenberg.

It started last week after France complained that Turkey is still breaking a UN arms embargo in effect on war-torn Libya. When a French frigate attempted to intercept a Turkish vessel suspected of running arms into Tripoli on June 10, it was reportedly “engaged” via radar, as if a missile strike was impending. The AP details, based on French defense sources:

According to a French defense official, the frigate Courbet was “lit up” three times by Turkish naval targeting radar when it tried to approach a Turkish civilian ship suspected of involvement in arms trafficking. The Courbet backed off after being targeted.

The French vessel was part of NATO’s naval operation in the Mediterranean, Sea Guardian, at the time of the June 10 incident.

The French frigate Courbet, via RFI.

Being “lit up” is is in reference to alleged Turkish radar targeting three times, suggesting an attack was imminent.

The civilian cargo ship suspected by the French navy of breaking the UN arms embargo was reportedly being escorted by no less than three Turkish warships.

Paris declared it a “hostile act” – something which Ankara denies. The French Foreign Ministry further accused the Turkish ships of “extremely aggressive” intervention against a NATO ally.

“We have made sure that NATO military authorities are investigating the incident to bring full clarity into what happened,” Stoltenberg told reporters Thursday, announcing the official probe.

Starting last year Turkey very publicly ramped up military support to Tripoli’s UN-recognized government, which had long been under assault by Gen. Khalifa Haftar and his LNA forces. Haftar forces weeks ago pulled back, finally ending the offensive, which many analysts attributed to superior Turkish military hardware and assistance. 

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Egypt & Ethiopia Are On Verge Of War Over Water As Nile Crisis Escalates

Egypt & Ethiopia Are On Verge Of War Over Water As Nile Crisis Escalates

Tyler Durden

Fri, 06/19/2020 – 03:30

Via AlMasdarNews.com,

A new report in the major Russian online newspaper Vzglyad, details prospects for the inevitability of war between Egypt and Ethiopia, if not today, then in the future.

Via Reuters: “Ethiopia sees the dam as essential for its electrification and development, while Sudan and Egypt view it as a threat to essential water supplies.”

According to the Russian-language report, negotiations between Egypt, Sudan and Ethiopia resumed on Sunday over a set of issues related to building a huge hydroelectric station on the Nile.

“The Ethiopians are building on the Blue Nile, Africa’s largest hydroelectric power plant, surpassing the Sayano Shushenskaya Hydropower Station,” journalist Yevgeny Krotikov said, pointing out that Ethiopia would become the second largest generator of electricity in Africa.

And Bloomberg confirms that the Russia-sponsored talks have failed :

A last ditch attempt to resolve a decade-long dispute between Egypt and Ethiopia over a huge new hydropower dam on the Nile has failed, raising the stakes in what – for all the public focus on technical issues – is a tussle for control over the region’s most important water source.

The talks appear to have faltered over a recurring issue: Ethiopia’s refusal to accept a permanent, minimum volume of water that the Grand Ethiopian Renaissance Dam, or GERD, should release downstream in the event of severe drought.

Via CNN

The Blue Nile is the main artery that feeds the Grand Nile, and the construction of the dam will lead to severe decay in the valley waters, where up to 90% of the Egyptian population lives.

Last year, an open conflict (between Ethiopia and Egypt) was avoided at the Russia-Africa summit in Sochi.

The current exacerbation is due to the fact that the Ethiopians have started filling the dam reservoir and will do so in record time, with a duration of three years.

“Now, it is incomprehensible that any compromise could take place. It was spent. Egypt is guilty of missing an opportunity. A warm congratulations can be sent to the ‘Arab Spring’ and Muslim Brotherhood,” Krotikov  argued.

“The next round of negotiations is likely to end with nothing. It is no longer possible to stop Ethiopia from its chosen path, with any international pressure. And Egypt, long ago, lacked the tools to exert such pressure on Addis Ababa. Things are moving towards war, and what can only be postponed for several years until the project works at full capacity, and its real consequences will appear on public life in Egypt.”

The report concluded: “After that, Cairo will have no choice but to try to solve the problem in a simple and severe manner.”

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EU Car Sales Crash 57% In May As Europe Grapples With Massive Inventory Glut

EU Car Sales Crash 57% In May As Europe Grapples With Massive Inventory Glut

Tyler Durden

Fri, 06/19/2020 – 02:45

New car sales in the EU plunged in May, falling 57% to 623,812, as Europe grapples with the same problem that the U.S. has had for weeks: a glut of inventory, despite re-opening some factories and re-starting production in certain areas.

All 27 EU member states posted double digit declines in new car sales, with the U.K. falling an astounding 89%, according to MarketWatch

Production coming out of the EU remains “well blow” pre-crisis levels but the lack of demand continues to contribute to a growing inventory problem. This, in turn, has created a slowdown in an industry that’s already moving at a crawl to begin with. Jobs and profits are both threatened from the glut, in addition to the monumental threat they both still continue to face from the ongoing global pandemic.

Unsold cars on dealer lots are “at least 30% above normal” according to industry analysts, while unsold inventory in Germany alone was about $17 billion worth. 

Antje Woltermann, managing director of the ZDK industry group: “Unsold stocks are climbing, and on the other hand vehicles are not leaving the lots.”

While Europe is struggling, many have looked to China, where sales were up 6% in May, for signs of optimism. For example, Stephan Wöllenstein, chief executive of Volkswagen Group China said: “The return of these kinds of figures is encouraging and gives us continued cautious optimism going forward.” 

But those numbers don’t account for the recent second wave of lockdowns, including in Beijing, that China now faces. 

Countries like France and Germany continues to try and spur sales with government incentives, but Germany is focusing primarily on EVs while the glut is in traditional ICE cars.

Recall, in May, we were ahead of the curve when we noted that European car registrations had plunged 76% in April. According to the European Automobile Manufacturers Association, the number of new cars sold fell from 1,143,046 to just 270,682 YOY in that month. 

The ACEA said at the time: “The first full month with COVID-19 restrictions in place resulted in the strongest monthly drop in car demand since records began.” 

It looks as though that trend has continued through May. 

April’s numbers were worst than March, though May’s registration numbers seem to show that there could be some respite for sales when those numbers are released.

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Why the DACA Rescission Failed CJ Robert’s APA “Severability” Analysis

Yesterday, I posted my high-level analysis of DHS v. Regents of California, the DACA case. This lengthy post will dive deeper into the weeds. I’ll presume familiarity with the facts of the case, the history of the litigation, and knowledge of basic APA doctrine.

Chief Justice Roberts’s analysis has eight major parts.

First, Roberts held that the DACA rescission is subject to judicial review. This conclusion is significant. In 2016, the Obama administration argued that DAPA itself was not subject to review because DAPA was a general non-enforcement policy. And in 2020, the Trump administration argued that the DACA rescission was not subject to review, because the rescission was also a general non-enforcement policy. (Republican and Democratic agencies agree on little but non-reviewability). But Roberts rejects both positions. He argues that DACA “is not simply a non-enforcement policy.” Why? Critically, the policy confers benefits:

The benefits attendant to deferred action provide further confirmation that DACA is more than simply a non-enforcement policy. As described above, by virtue of receiving deferred action, the 700,000 DACA recipients may request work authorization and are eligible for Social Security and Medicare. Unlike an agency’s refusal to take requested enforcement action, access to these types of benefits is an interest “courts often are called upon to protect.” Chaney. Because the DACA program is more than a non-enforcement policy, its rescission is subject to review under the APA.

Defenders of DACA have long argued that the policy is merely an act of prioritization: certain people are de-prioritized for removal. Chief Justice Roberts has killed that argument. As a result, Texas’s long-pending challenge to DACA has now cleared the reviewability hurdle. That case can proceed to the merits. These holdings were small concessions for the Court’s four liberals to pay for a favorable judgment.

Second, Chief Justice Roberts limited his review to the Duke memorandum, and disregards the Nielsen memorandum. I think this analysis is correct. The Nielsen memo added additional justifications that were not in the agency action. Roberts write:

The policy reasons that Secretary Nielsen cites as a third basis for the rescission are also nowhere to be found in the Duke Memorandum. That document makes no mention of a preference for legislative fixes, the superiority of case-by-case decisionmaking, the importance of sending a message of robust enforcement, or any other policy consideration. Nor are these points included in the legal analysis from the Fifth Circuit and the Attorney General. They can be viewed only as impermissible post hoc rationalizations and thus are not properly before us.

Judge Bates put the administration in a tough bind. They did the best they could.

Third, Roberts finds that the rescission is arbitrary and capricious. But he expressly rejects the approaches of three courts of appeals. These courts held that the Secretary was wrong to rely on the Fifth Circuit’s decision, because the Fifth Circuit was wrong. For example, the Ninth Circuit held that the Fifth Circuit erred in Texas v. U.S. Therefore, the Secretary’s analysis was arbitrary and capricious:

DACA is being implemented in a manner that reflects discretionary, case-by-case review, and at least one of the Fifth Circuit’s key rationales in striking down DAPA is inapplicable with respect to DACA. With respect for our sister circuit, we find the analysis that seemingly compelled the result in Texas entirely inapposite. And because the Acting Secretary was therefore incorrect in her belief that DACA was illegal and had to be rescinded, plaintiffs are likely to succeed in demonstrating that the rescission must be set aside. Chenery I, 318 U.S. at 94.

But Chief Justice Roberts did not adopt this approach. He did not disagree with the Fifth Circuit’s decision. He could have. That holding would have made this case much easier. To the contrary, he recited the Fifth Circuit’s analysis without any criticism whatsoever.

Does this recitation suggest Roberts agrees with Judges Smith and Elrod? Possibly. Roberts explains that Secretary Duke was “bound by the Attorney General’s legal determination” concerning Texas v. U.S. He added, “Whether DACA is illegal is, of course, a legal determination, and therefore a question for the Attorney General.” Even if the Attorney General relied on an erroneous precedent, the DHS Secretary could not have disagreed. But I am inclined to believe that Roberts endorsed the Fifth Circuit’s rationale. I’ll explain why in the next part.

Fourth, Roberts concludes that part of DACA is lawful: specifically, the power to forbear removal. The legal debate only concerned the conferral of benefits, such as work authorization. Roberts doesn’t quite say that conferring benefits is illegal. In his typical fashion, Roberts hedges on all important legal questions. The manner in which he relies on the Fifth Circuit suggests he leans that way. But it is ultimately noncommittal. I don’t think the rest of the Kagan Court would have joined a more express analysis.

Let’s walk through the Court’s discussion of the Smith/Elrod decision. Roberts explains that the “core” of the challenge involved conferring benefits.

But Duke did not appear to appreciate the full scope of her discretion, which picked up where the Attorney General’s legal reasoning left off. The Attorney General concluded that “the DACA policy has the same legal … defects that the courts recognized as to DAPA.” So, to understand those defects, we look to the Fifth Circuit, the highest court to offer a reasoned opinion on the legality of DAPA. That court described the “core” issue before it as the “Secretary’s decision” to grant “eligibility for benefits”—including work authorization, Social Security, and Medicare—to unauthorized aliens on “a class-wide basis.” The Fifth Circuit’s focus on these benefits was central to every stage of its analysis. And the Court ultimately held that DAPA was “manifestly contrary to the INA” precisely because it “would make 4.3 million otherwise removable aliens” eligible for work authorization and public benefits.

Roberts added an important footnote: forbearance from removal is separate from conferring benefits.

 FN5: As the Fifth Circuit noted, DAPA recipients were eligible for Social Security and Medicare benefits because they had been designated “lawfully present.” Lawful presence is a statutory prerequisite for receipt of certain benefits. It is not the same as forbearance nor does it flow inexorably from forbearance. Thus, while deferred action recipients have been designated lawfully present for purposes of Social Security and Medicare eligibility, agencies can also exclude them from this designation, see 45 CFR § 152.2(8) (2019) (specifying that DACA recipients are not considered lawfully present for purposes of coverage under the Affordable Care Act).

Later, Roberts would fault Duke for not expressly excluding DACA recipients from the regulations for purposes of the benefits.

He explains that the essential element of DACA is forbearance from removal.

But there is more to DAPA (and DACA) than such benefits. The defining feature of deferred action is the decision to defer removal (and to notify the affected alien of that decision). And the Fifth Circuit was careful to distinguish that forbearance component from eligibility for benefits. … In other words, the Secretary’s forbearance authority was unimpaired.

Did the Fifth Circuit restrict Dukes’s power to halt deportations? No. And the failure to address that element was an error.

In short, the Attorney General neither addressed the forbearance policy at the heart of DACA nor compelled DHS to abandon that policy. Thus, removing benefits eligibility while continuing forbearance remained squarely within the discretion of Acting Secretary Duke, who was responsible for “[e]stablishing national immigration enforcement policies and priorities.” 6 U. S. C. § 202(5). But Duke’s memo offers no reason for terminating forbearance. She instead treated the Attorney General’s conclusion regarding the illegality of benefits as sufficient to rescind both benefits and forbearance, without explanation….

Roberts’s analysis resembles something of a severability framework. He assumed (and perhaps agreed) that part of DACA was unlawful: the conferral of benefits. But other parts were perfectly permissible: forbearing removal. The Secretary’s decision to halt the entire policy thus botched severability. She used a sledgehammer, rather than a scalpel. Because Dukes’s failed to properly sever the impermissible portion of the DACA memorandum, her entire rescission is arbitrary and capricious.

Think about that remedy for a moment. Perhaps the Court could have used a severability analysis for the rescission memo. That is, hold that DHS has justified the cancellation of benefits, but has not justified the cancellation of forbearance. (I privately speculated about such an outcome–let the Dreamers stay, but they can’t work). Roberts could have vacated part of the rescission memo, but left other parts intact. He didn’t. He vacated the entire memo. And why did Roberts use a sledgehammer instead of a scalpel? Because Dukes used a sledgehammer instead of a scalpel. In other words, Duke’s punishment for failing to sever DACA, was Robert’s decision not to sever the rescission memo. A delicious John Roberts blue plate special.

Sixth, Roberts grounds his severability analysis in the admin law chestnut, State Farm.

There, the National Highway Traffic Safety Administration (NHTSA) promulgated a requirement that motor vehicles produced after 1982 be equipped with one of two passive restraints: airbags or automatic seatbelts. Four years later, before the requirement went into effect, NHTSA concluded that automatic seatbelts, the restraint of choice for most manufacturers, would not provide effective protection. Based on that premise, NHTSA rescinded the passive restraint requirement in full.

We concluded that the total rescission was arbitrary and capricious. As we explained, NHTSA’s justification supported only “disallow[ing] compliance by means of ” automatic seatbelts. It did “not cast doubt” on the “efficacy of airbag technology” or upon “the need for a passive restraint standard.” Given NHTSA’s prior judgment that “airbags are an effective and cost-beneficial lifesaving technology,” we held that “the mandatory passive restraint rule [could] not be abandoned without any consideration whatsoever of an airbags-only requirement.”

Roberts then applies this framework to the DACA rescission:

While the factual setting is different here, the error is the same. Even if it is illegal for DHS to extend work authorization and other benefits to DACA recipients, that conclusion supported only “disallow[ing]” benefits. It did “not cast doubt” on the legality of forbearance or upon DHS’s original reasons for extending forbearance to childhood arrivals. Thus, given DHS’s earlier judgment that forbearance is “especially justified” for “productive young people” who were brought here as children and “know only this country as home,” the DACA Memorandum could not be rescinded in full “without any consideration whatsoever” of a forbearance-only policy, State Farm.

Dukes’s flaw was rescinding DACA “in full.” What should she have done instead? Roberts offers a proposal in a footnote:

DHS could have addressed the Attorney General’s determination that such benefits were impermissible under the INA by amending 8 CFR § 1.3 to exclude DACA recipients from those benefits without rescinding the DACA Memorandum and the forbearance policy it established. But Duke’s rescission memo shows no cognizance of this possibility.

Dukes’s failed to address this partial-illegality, and the precise remedy Roberts conjured up.

The SG tried to preempt this point in his reply brief. DOJ was obviously worried about this anti-saving construction:

The Government acknowledges that “[d]eferred action coupled with the associated benefits are the two legs upon which the DACA policy stands.” Reply Brief 21. It insists, however, that “DHS was not required to consider whether DACA’s illegality could be addressed by separating” the two. Ibid. According to the Government, “It was not arbitrary and capricious for DHS to view deferred action and its collateral benefits as importantly linked.”

No such luck.

Perhaps. But that response misses the point. The fact that there may be a valid reason not to separate deferred action from benefits does not establish that DHS considered that option or that such consideration was unnecessary.

In short, DHS is to be faulted for not considering a more narrowly tailored way to accomplish their goal. I framed that test quite deliberately. Roberts’s test resembles strict scrutiny. Roberts applied an over-inclusiveness standard to the arbitrary and capricious standard. Indeed, it is even stricter than strict scrutiny: the failure to anticipate the precise remedy that the Chief Justice–and no one else–conjured up has rendered the action unlawful.

Indeed, this approach resembles the mirror image of the rational basis test. With rational basis review, the Court can manufacture reasons to uphold a governmental policy, even if the government did not actually entertain that justification. Roberts flips the script. He manufactures reasons to invalidate a governmental policy, even if no one–not a single judge, litigant, or even academic–considered it. Roberts moved the goal posts. No agency can possibly conceive of every possible way to address a problem.

Seventh, Roberts responds to Justice Thomas, who criticizes this severability analysis. Thomas wrote:

Even assuming the majority correctly characterizes the Fifth Circuit’s opinion, it cites no authority for the proposition that arbitrary and capricious review requires an agency to dissect an unlawful program piece by piece, scrutinizing each separate element to determine whether it would independently violate the law, rather than just to rescind the entire program.

Roberts replies:

State Farm teaches that when an agency rescinds a prior policy its reasoned analysis must consider the “alternative[s]” that are “within the ambit of the existing [policy].” Here forbearance was not simply “within the ambit of the existing [policy],” it was the centerpiece of the policy: DACA, after all, stands for “Deferred Action for Childhood Arrivals.” But the rescission memorandum contains no discussion of forbearance or the option of retaining forbearance without benefits. Duke “entirely failed to consider [that] important aspect of the problem.”

Thomas replied that State Farm does not apply in this unique context. DHS shifted positions not out of policy preferences, but because a court declared part of the policy unlawful.  He wrote:

The majority has no answer except to suggest that this approach is inconsistent with State Farm. But in doing so, the majority ignores the fact that, unlike the typical “prior policy” contemplated by the Court in State Farm, DACA is unlawful. Neither State Farm nor any other decision cited by the majority addresses what an agency must do when it has inherited an unlawful program. It is perhaps for this reason that, rather than responding with authority of its own, the majority simply opts to excise the “unlawful policy” aspect from its discussion.

Thomas is right. Indeed, DHS may have not grounded the rescission solely on policy grounds because of precedents like State Farm. And policy concerns would not override reliance interests. Roberts has no response to this point. This unique case does not fit the State Farm paradigm.

Thomas drives this point home forcefully:

By requiring more, the majority has distorted the APA review process beyond recognition, further burdening all future attempts to rescind unlawful programs. Plaintiffs frequently bring successful challenges to agency actions by arguing that the agency has impermissibly dressed up a legislative rule as a policy statement and must comply with the relevant procedures before functionally binding regulated parties. But going forward, when a rescinding agency inherits an invalid legislative rule that ignored virtually every rulemaking requirement of the APA, it will be obliged to overlook that reality. Instead of simply terminating the program because it did not go through the requisite process, the agency will be compelled to treat an invalid legislative rule as though it were legitimate

Finally, Thomas also questions whether Dukes could have “severed” the forbearance element from the benefits element. In short, if DHS modified every single regulation that confers benefits on DACA recipients, the agency would run into countless APA challenges. It would never be accomplished. The far easier path is to simply rescind the root cause: the DACA policy, rather than make dozens of piecemeal changes.

The majority’s interpretation of the Fifth Circuit’s opinion is highly questionable. Because a grant of deferred action renders DACA recipients eligible for certain benefits and work authorization, it is far from clear that the Department could separate DACA’s “forbearance component” from the major benefits it conferred without running into yet another APA problem. The majority points to the fact that, under the Patient Protection and Affordable Care Act of 2010, relevant regulations exclude those receiving deferred action through DACA from coverage. But that misses the point. Those regulations were promulgated before “anyone with deferred action under the DACA process applie[d]” for those benefits. By contrast, DACA recipients have been eligible for and have received Medicare, Social Security, and work authorization for years. DHS therefore is not writing on a blank slate. Under the majority’s rule, DHS would need to amend all relevant regulations and explain why all recipients of deferred action who have previously received such benefits may no longer receive them. Alternatively and perhaps more problematically, it would need to provide a reason why other recipients of deferred action should continue to qualify, while DACA recipients should not. It thus seems highly likely that the majority’s proposed course of action would be subject to serious arbitrary and capricious challenges.

Roberts certainly knows that trying to modify dozens of regulations would be problematic. He does not seriously expect the administration to take these steps on remand. Nor did he expect the administration to revise the census form last summer. He dangles a meaningless offer of relief–one last chance!–to assuage his perverse sense of minimalism.

Eighth, Roberts also holds that Dukes failed to adequately consider reliance interests. In other words, even if Dukes jumped through hoop the fecund mind of John Roberts can concoct to survive A&C review, the memo was still inadequate. Why? Roberts has more hoops to jump through:

Had Duke considered reliance interests, she might, for example, have considered a broader renewal period based on the need for DACA recipients to reorder their affairs. Alternatively, Duke might have considered more accommodating termination dates for recipients caught in the middle of a time-bounded commitment, to allow them to, say, graduate from their course of study, complete their military service, or finish a medical treatment regimen. Or she might have instructed immigration officials to give salient weight to any reliance interests engendered by DACA when exercising individualized enforcement discretion.

No memorandum can possibly touch all the bases. It is impossible. And now, even if the agency attempts to issue a new memorandum, district courts around the country will use Roberts’s dictum as a checklist. The failure to consider and address these issues renders the rescission unlawful.

This sort of narrow tailoring exceeds strict scrutiny, the kind Roberts would not apply in any other context. Not for Free Speech. Not for substantive due process. Certainly not for the Second Amendment.

***

I sincerely hope this case is a ticket good for one ride on the John Roberts express. This framework, if taken seriously–which I do not–would make it impossible for any agency to modify an old policy that is in effect. There will always be countless ways to address reliance interests. My prediction: the DACA case will soon be treated like the APA analysis in the Census case. Another blip in administrative law that was only needed for the moment.

Of course, there may be an upside. If President Trump loses in November, his administration could rush through a package of questionable executive actions, on which people will quickly rely upon, rendering it impossible for President Biden to rescind them. I’m sure Roberts will find a way to respond in kind.

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Publishing Staff Threaten To Quit Unless JK Rowling’s New Book Is Canceled

Publishing Staff Threaten To Quit Unless JK Rowling’s New Book Is Canceled

Tyler Durden

Fri, 06/19/2020 – 02:00

Authored by Steve Watson via Summit News,

Staff at Publishing house Hachette have threatened to quit unless the company cancels its association with JK Rowling and scraps plans to publish her new book because they argue the author is ‘transphobic’.

The Daily Mail reported that “Staff in the children’s department at Hachette announced they were no longer prepared to work on the book” over Rowling’s recent assertions that biological sex is real and that there are only two genders.

The Mail further reported that the publishing staffers “said they were opposed to her comments and wanted to show support for the trans lobby.”

“These staff are all very ‘woke’, mainly in their twenties and early thirties, and apparently it is an issue they feel very strongly about.” the report adds.

According to an ‘insider’ “It was a handful of staff, and they are entitled to their views. If they were being asked to edit a book on domestic abuse, and they were a survivor of domestic abuse, of course they would never be forced to work on it. But this is a children’s fairy tale. It is not the end of the world. They will all be having chats with their managers.”

Hachette is backing Rowling, having issued a statement saying “We are proud to publish JK Rowling’s children’s fairy tale The Ickabog. Freedom of speech is the cornerstone of publishing.”

“We fundamentally believe that everyone has the right to express their own thoughts and beliefs. That’s why we never comment on our authors’ personal views and we respect our employees’ right to hold a different view.” the company added.

“We will never make our employees work on a book whose content they find upsetting for personal reasons, but we draw a distinction between that and refusing to work on a book because they disagree with an author’s views outside their writing, which runs contrary to our belief in free speech.” the statement also noted.

via ZeroHedge News https://ift.tt/2YeN66E Tyler Durden