Do Originalists Ignore the Reconstruction Amendments?

Constitution

Critics of originalism sometimes claim that originalists focus only on the original 1787 Constitution, while ignoring the Reconstruction amendments, which transformed the Constitution after the Civil War. Sometimes, this criticism is combined with the argument that the neglect of the Reconstruction Amendments is intended to privilege white men over blacks and other racial minorities, whose rights those amendments were enacted to secure. Such arguments have gotten renewed prominence in the wake of the controversial nomination of Amy Coney Barrett to the Supreme Court—thanks in part to a New York Times op ed by Janelle Bouie, arguing that originalists ignore the fact that “[t]he Americans who drafted, fought for and ratified the Thirteenth, Fourteenth and Fifteenth Amendments did nothing less than rewrite the Constitution with an eye toward a more free and equal country.” He concludes that “The Reconstruction Constitution is a fundamentally different document than the Constitution of 1787. Yet our conversations around ‘original meaning’ rarely take account of this change.”

A recent op ed by MSNBC contributor Hayes Brown similarly accuses originalists of ignoring “the fundamental constitutional shift that occurred after the passage of the 13th, 14th and 15th amendments.” Such claims are not new. But they are badly wrong. Those who accuse originalists of ignoring the significance of the Reconstruction amendments are themselves of guilty of ignoring a vast originalist literature devoted to that very subject.

In reality, numerous prominent originalist legal scholars have written extensively about the Reconstruction amendments and their significance. Michael McConnell (a well-known originalist who was, for a time, also a federal judge) has authored prominent articles on the original meaning of the Fourteenth Amendment with respect to both racial discrimination and the meaning of due process of law. Steve Calabresi (another prominent originalist legal scholar, and co-founder of the Federalist Society), has coauthored prominent articles arguing that the original meaning of the Fourteenth Amendment provides broad protection against both racial discrimination and sex discrimination. Christina Mulligan has an important article outlining how we can and should take account of diverse perspectives (including those of women and racial minorities) in understanding the original meaning of the Constitution. Her work is of obvious relevance to interpretation of the Reconstruction amendments.

Co-blogger Randy Barnett ,Evan Bernick, and Kurt Lash, are among a number of originalist legal scholars who have written major works on the meaning of the Privileges or Immunities Clause, in some cases arguing that it provides broad protection for a wide range of rights—far beyond what is protected by the courts today. Bernick also has a pathbreaking new article arguing for a broader interpretation of the Equal Protection Clause, contending that its original meaning imposes an affirmative duty of protection on the state, not merely a duty to avoid racial discrimination. Michael Rappaport, another leading originalist constitutional theorist, has written notable articles exploring the implications of the original meaning of the Fourteenth Amendment for affirmative action programs, and for regulatory takings.

In my book The Grasping Hand, I discuss the impact of the Fourteenth Amendment’s “incorporation” of the Bill of Rights against state governments for “public use” constraints on government power to take private property. I argue that the Reconstruction-era understanding of public use—as revealed in contemporary court decisions,  debates over the abolition of slavery, and the framers’ goal of protecting blacks and white Unionists against state governments —provides a stronger basis for enforcing tight limits on government’s power to take private property than is evident in the original 1791 meaning of the Fifth Amendment.

Nor is originalist interest in the Reconstruction Amendments just a product of recent years. McConnell’s work on race discrimination dates back to the 1990s. As far back as 1980, Bernard Siegan published Economic Liberties and the Constitution, which argues that the original meaning of the Fourteenth Amendment provides much broader protection for economic liberties than modern judicial doctrine is willing to recognize. Prominent early originalists such as Robert Bork and Raoul Berger also wrote about the original meaning of the Fourteenth Amendment in the 1960s and 70s, though most modern originalists (myself included) would today argue that Bork and Berger got many things wrong.

It’s also worth noting that pretty much all of the above writers recognize that the Reconstruction amendments made major changes to the existing constitutional order. Few if any originalists claim that the original 1787 Constitution somehow remains in force with few or no significant changes.

There has been much less originalist analysis of the meanings of the Thirteenth and Fifteenth Amendments. But that is in large part because there is less controversy about these amendments than the Fourteenth. Nonetheless, there is a growing originalist literature on these amendments, as well. Notre Dame law Professor Jennifer Mason McAward, for example, has done important work pushing back on the newly popular idea that the Thirteenth Amendment gives Congress broad power to legislate against any injustices than can in some way be indirectly linked to slavery, though she also emphasizes that it does give broad power to suppress slavery and “involuntary servitude” themselves.

With the exception of Raoul Berger (an idiosyncratic liberal who was often associated with conservatives), the above-listed works are all by conservative or libertarian originalists. It is they who most often get accused of ignoring the Reconstruction amendments. But it is important to recognize that liberal originalists have also written major works on the Reconstruction Amendments. Akhil Amar, for example, has literally written the book on how those amendments should change interpretation of the Bill of Rights.

The works mentioned above are just a sample of the vast outpouring of writings on the Reconstruction Amendments produced by originalists over the last several decades. For reasons of space, I have had to omit a great many important books and articles on numerous issues.

It is fair to argue that prominent originalist judges haven’t focused on the original meaning of the Reconstruction amendments nearly as much as academics have (though that is not true of several, like McConnell, who are—or have been—both scholars and judges). Still, originalist judges are far from simply ignoring those Amendments.

Clarence Thomas, for example, has written a well-known opinion arguing that the original meaning of the Fourteenth Amendment strengthens the case for “incorporating” the Second Amendment right to bear arms against the states. The drafters of the Amendment, he points out, believed this to be an important safeguard for blacks’ rights against oppression by racist state and local governments. As far back as 1973, Justice William Rehnquist’s dissent in Roe v. Wade was based in large part on arguments drawn from the original meaning of the Fourteenth Amendment. And these are far from the only examples of originalist judges grappling with the Reconstruction Amendments on a variety of issues.

Originalist judges can and should do a much better job of including the original meaning of the Reconstruction amendments in their jurisprudence than many have done so far. But it is wrong to claim that they have simply ignored the issue, or that they somehow] believe that the Constitution remains largely unchanged since 1787.

I do not expect columnists and other non-experts to be familiar with all of these writings. Indeed, the literature has grown so large that even most constitutional law scholars (myself included!) can’t keep track of all of it. But, while it would be unreasonable to expect lay pundits and commentators, to study this literature in detail, they should at least consult relevant specialists before making sweeping claims about originalism.

Ironically, critics who claim originalists have ignored the Recontruction amendments are at odds with academic critics who argue that originalists take an overly optimistic view of their meaning (as Stephen Griffin contends in an important recent article), or that they disagree among themselves about that meaning so much, that the disagreement proves that originalism is indeterminate. I criticized the latter argument here. Such critiques of originalism would make little sense if originalists really had largely ignored the Reconstruction amendments.

None of the above proves that originalists have found the “right” possible interpretation of the Reconstruction amendments, or that originalism is superior to alternatives such as living constitutionalism. There are plenty of legitimate criticisms of both originalist takes on the Reconstruction amendments, and originalism as a more general theory of constitutional interpretation.

I myself have reservations about many versions of originalism, and defend the theory only on contingent “instrumental” grounds. I remain open to the possibility that some other approach to constitutional interpretation (perhaps one not yet fully developed) might turn out to be superior. But the public debate over originalism and constitutional theory is not advanced by false claims that its exponents have ignored the significance of a set of amendments on which they have actually written extensively.

 

 

 

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2020: Year Of The Black GOP Renaissance, Thanks To Trump

2020: Year Of The Black GOP Renaissance, Thanks To Trump

Tyler Durden

Sun, 10/18/2020 – 17:50

Authored by Paris Dennard via RealClearPolitics.com,

Twenty-seven Black Republican candidates are running for Congress this election, and that is a good thing for the Republican Party, our political system, and our entire country. 

In 2016, when Republican National Committee (RNC) Chairwoman Ronna McDaniel headed the Michigan GOP, all the political pundits and pollsters wrote off the state as fly-over country and certainly did not think a Republican could do well there. And yet Donald J. Trump beat Hillary Clinton and won that diverse state. The investments and effective campaigning laid the foundation for 2020. 

The RNC, in addition to running print ads in Black newspapers and hosting GOTV events from our Black Voices for Trump Community Centers, just launched a new seven-figure voter-contact initiative to directly target and engage with Black voters in urban communities all over the country, safely knocking on doors to get out the vote for President Trump.

Today in Michigan, veteran businessman and rising GOP star John James is running to be the next U.S. senator from that state. After serving in the military for eight years and earning a Combat Action Badge and two Air Medals, James went on to become president of James Group International, growing the family business into a major trading partner in the Michigan auto industry. He knows what it takes to achieve the great American comeback for his state. John James and President Trump are two leaders made in the USA for this moment. 

While James hopes to join South Carolina’s Tim Scott (pictured above) in the Senate, 26 Black Americans are running as Republican nominees to make history in the House of Representatives. Can you imagine how courageous you have to be to run in 2020 as a Black Republican, with all of the vitriol and cancel culture attempts from the radical liberal left?

Whether it is Joe Biden saying “You ain’t black,” or MSNBC calling Black Republican candidates Burgess Owens and Kimberly Klacik part of a “modern day minstrel show,” these men and women are leaders who care, and who are inspired by another leader – a man who took the opposition head on, ignored pundits and pollsters who doubted him, and won. That leader is President Trump. 

Hopefully, the mainstream media will report on these candidates as fairly and respectfully as they did the candidates who became known as “The Squad,” making them household names as well.

Why not tell a different narrative, show there are Black Americans who think for themselves, care about their communities and are proud Republicans? 

The following Black candidates are standing up for their values, standing up for their families, and deserve to be heard and not silenced or canceled because they are not running as radical liberals: Tamika Hamilton, Ronda Baldwin-Kennedy, Errol Webber, Aja Smith, and Joe Collins in California; Casper Stockham in Colorado; Byron Donalds, Carla Spalding, Vennia Francois, and Lavern Spicer in Florida; Angela Stanton-King in Georgia; Philanise White and Craig Cameron in Illinois; Rayla Campbell in Massachusetts; Kimberly Klacik in Maryland; John James in Michigan; Kendall Qualls and Lacy Johnson in Minnesota; Billy Prempeh in New Jersey; Laverne Gore in Ohio; Kathy Barnette in Pennsylvania; Charlotte Bergmann in Tennessee; Wesley Hunt, Wendell Champion, and Tre Pennie in Texas; Burgess Owens in Utah; and Leon Benjamin in Virginia.

At the recent unveiling of his plan for Black economic empowerment known as the “Platinum Planin Atlanta, President Trump singled out these candidates running to join him in Washington to implement many aspects of this holistic plan for the Black community to help Make America Great Again, again!

In Florida, GOP Rep. Byron Donalds said, “I’m everything the fake news media tells you doesn’t exist: A strong, Trump-supporting, gun-owning, liberty-loving, pro-life, politically incorrect Black man.” Raised in a single parent household in New York, he worked hard, earned a college degree in finance and marketing, and launched a career in the banking industry in Florida. The call to public service led him to the Florida State House, where voters got to know him and appreciate his conservative values. Donalds sits on five committees and chairs a subcommittee on insurance and banking. If there was ever a time to have someone in Congress who understands our economy and has earned the trust of his community, it is today. 

This election, political elites will be reminded that the Republican Party is the original home of Black Americans and Black Republican congressmen. Remember, the first Black American to serve in the U.S. Senate was a Republican, Sen. Hiram Revels of Mississippi. From 1870 to 1935, the Black men who served in the House of Representatives were all Republicans. 

Under President Trump the GOP is expanding and attracting more unlikely supporters in what we call “the silent majority.” The GOP is an open tent party, the party of Abraham Lincoln, the party of freedom, opportunity, justice and civil rights. We are a diverse party and President Trump welcomes everyone because he understands that leadership knows no color, and success knows no ethnic background. 

Joe Biden believes Blacks are devoid of diversity so it would be hard, with his bigoted worldview, to understand that the 27 Black Americans running for Congress are doing so because they want to put America first; they want the Platinum Plan in place; they want to keep taxes low and expand opportunity zones; and they reject illegal immigration, open borders, and the Green New Deal. 

These 27 incredible candidates want to help usher in the Great American comeback with their election and the reelection of Donald Trump. 

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The One-Chart Summary Of All That Is Wrong With The US Financial System: Deposits Over Loans

The One-Chart Summary Of All That Is Wrong With The US Financial System: Deposits Over Loans

Tyler Durden

Sun, 10/18/2020 – 17:25

Now that the big banks have concluded their earnings season, with the top highlight being the collapse in loan loss reserve builds from $33 billion in Q2 to just $5 billion in the quarter ended Sept 30…

… in what some have taken as a vote of confidence for the economy as bank risk managers clearly don’t anticipate another sharp leg lower in the economy (that may change if a second wave of covid forces new shutdowns), we can take a closer look at some of the other, just as notable observations within the US financial sector.

First, we looked at the amount of total loans across the 4 megabanks, where for the second consecutive quarter aggregate loans declined after the Q1 surge (which as a reminder was driven almost entirely by revolver drawdowns, which have since been refinanced by bonds and other debt instruments).

Those who have followed our reporting on the surge in bank lending standards, which recently spiked to levels not seen since the financial crisis, will not be surprised by the ongoing freeze in loan issuance: after all, banks remain terrified about lending across most verticals, including C&I, consumer (credit card and auto loans) and residential and commercial real estate.

Yet while the continued flatlining in US bank loans – which haven’t budged in the past two years and have barely increased since the financial crisis – is explainable, it is nonetheless quite troubling: after all, if there is neither supply nor demand for loans, the economy simply won’t grow, period. It’s also why the velocity of money will be catastrophic and is approaching that monetary “singularity” of 1 for the first time ever.

However, while it is hardly surprising that loan growth has refused to pick up during the worst economic depression since the “Great” one, what is certainly remarkable is when one looks at the corresponding bank liability: deposits. Here, there is no such problem, and in fact, in recent quarter (and years), deposits have exploded higher and continued to do so last quarter too.

Why is this notable? Well, for one, it crushes the socialism-enabling “theory” known as MMT, or Modern Money Theory, also known as Helicopter Money. Recall that according to the hodgepodge of confused concerts that were thrown at the wall in hopes of coming up with some comprehensive monetary theory, from the perspective of Modern Monetary Theory private bank lending is unconstrained by the quantity of reserves the bank holds at any point in time. In other words, according to MMT loans create deposits (see here, here, and here). Only… clearly in reality that’s not the case.

Which then brings us to what may be the best one-chart summary of all that is wrong with the US financial system. It is a very simple chart – it shows consolidated deposits and loans within the US financial system (which consists of both US and foreign banks).

Why is it a good summary? Because, for one, total loans issued by US bank were $3.6 trillion in Q3 2020: just a tiny $300 billion more than in the quarter Lehman blew up. More than a decade later, and the US commercial bank lending apparatus is still in a state of shock…

But why don’t banks lend out more: after all that is the main pathway to stimulate the economy as all pundits will tell us. Simple: it doesn’t need to. As the green line above shows, total consumer deposits held by the banks has continued to explode higher, rising to a record $6.35 trillion, up more than $50 billion in the quarter, and pushing the deposit-over-loan difference to a new record of $2.7 trillion! So much for loans creating deposits.

Of course, as can be clearly seen in the chart above where the breach between the red and green lines emerged when the Fed started QE, all this is happening exclusively due to the Fed, which had to step in with QE and create exogenous money of its own, as banks still refuse to “create” money from loans. the next chart of Excess Deposits within the US commercial bank system vs the Fed’s balance sheet, shows quite clearly just what is going on.

This also means that banks have had to allocate this excess capital somehow – as a reminder, it was precisely “excess deposits” that JPMorgan was using to fund its prop trading desk and corner various derivative markets courtesy of the London Whale traders, something we explained back in 2013.

Incidentally, the above also shows explicitly how the Fed’s reserves – which most still erroneously believe are inert for US Commercial Banks – end up being used to manipulate markets once they end up as excess deposits on bank balance sheets.

Another consequence is that risk assets continue to be bid up to record highs on the back of QE, even as the actual flow through of the Fed’s “wealth effect” to the economy is halted precisely due to the complete collapse in new loan creation – the primary “transmission mechanism” of economic growth.

In other words, by keeping the pedal to the metal on QE, the Fed is giving the banks all the benefits of money creation (soaring deposits), without any of the risks (loan creation in a record low Net Interest Margin environemnt). Any if you are a major US bank – say JPMorgan – you will be perfectly happy with this arrangement and not seek to lend out any money, as the case has been for the past 12 years. Which means consumers who wish to take out loans to fund ventures and other growth strategies are fresh out of luck, because the banks that ordinarily supply them with this risk capital have simply shut down the process as the latest Fed’s Senior Loan Officer Opinion Survey showed.

And that is precisely the crux of all that is broken in the US financial system, and why the Fed’s QE is making things worse, not better, and is progressively destroying the wealth of the middle class, stunting any growth opportunities the US may have, and all the residual wealth is pumped into the hands of those benefiting solely from rising asset prices. The result: as we reported last week, the 50 Richest Americans Now Worth More Than Poorest 165 Million

… and all thanks to the Fed.

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How Big Can the Ninth Circuit Get?

With 29 judges in active service, the U.S. Court of Appeals for the Ninth Circuit is already the nations largest federal appellate court. The court is so large that it does not sit as a full court when sitting en banc. Instead, en banc panels consist of the Chief Judge and ten other judges selected at random.

The Judicial Conference of the United States is recommending the addition of five additional seats to the Ninth Circuit, in addition to 73 district court judgeships around the country (eight of which are temporary judgeships that would be made permanent). These recommendations are based upon the Judicial Conference’s assessment of court caseloads and administrative needs, and were the subject of a Senate Judiciary Committee hearing earlier this year.

The Conference is likely correct that the Ninth Circuit needs more judges to handle the volume of cases within the circuit. The same goes for their district court recommendations. The last time Congress significantly expanded the federal courts was in 1990, and court caseloads have increased substantially since then, particularly in federal district courts. Expanding lower courts to handle the nation’s legal needs is overdue.

While I accept the Judicial Conference’s claim that the nation needs more federal judges, I confess some reluctance to make the Ninth Circuit any larger. It is already an unwieldy court, far larger than any other circuit. While the Judicial Conference is recommending that the Ninth Circuit have over thirty judges, no other circuit court even has twenty—and no other circuit has adopted the Ninth Circuit’s non-banc en banc process.

When Congress gets around to responding to the Judicial Conference’s request, I hope it also gives consideration to splitting the Ninth Circuit into two, more normal-sized courts. In the past, such proposals have foundered on political concerns, such as that California’s influence would overwhelm that of any other states in a newly constituted court. The alternatives of spitting California between two circuits or having a California-only circuit are also less-then desirable. Perhaps so, but it seems to me that a 30-plus judge circuit court is worse. Creating two circuit courts—a California-only court and another consisting of the remainder of the current Ninth—with 18 judges each, would satisfy the need for more judges and cut the current Ninth down to size.

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Steve Bannon Behind ‘Roll-Out Plan’ For Hunter Biden Emails, Says ‘Multiple Stories From Multiple Media Sources’ About To Hit

Steve Bannon Behind ‘Roll-Out Plan’ For Hunter Biden Emails, Says ‘Multiple Stories From Multiple Media Sources’ About To Hit

Tyler Durden

Sun, 10/18/2020 – 17:00

In a recent interview with Revolver, former White House Chief Strategist Steve Bannon admitted that he’s the architect of a coordinated roll-out of the Hunter Biden laptop contents, and that there’s much, much more to come.

To review, last month the New York Post set off a nuclear bomb when they released evidence from the younger Biden’s hard drive obtained by Rudy Giuliani, after a computer repair shop owner initially approached the FBI, which appears to have concealed evidence of Biden family corruption in Ukraine and elsewhere while President Trump was being impeached for asking Ukraine to investigate exactly that.

And Steve Bannon is master of ceremonies for this October surprise.

As former Breitbart journalist Lee Stranahan – who’s not exactly Bannon’s biggest fan – puts it, “I can’t think of a single example of him saying he had the goods on the story that didn’t pan out,” adding “If he says a lot more is coming he’s not shooting blanks.”

Interview with Steve Bannon via Revolver.com (emphasis ours)

Last week the NY Post took the political world by storm with its release of shocking material from Hunter Biden’s hard drive indicating corruption, sexual depravity, and more. The Post reported that a lawyer for former NY Mayor Rudy Giuliani obtained the hard drive from a computer repairman and that former White House Chief Strategist Steve Bannon had alerted the Post to the existence of the hard drive in July.

But before turning over the gear, the shop owner says, he made a copy of the hard drive and later gave it to former Mayor Rudy Giuliani’s lawyer, Robert Costello.

Steve Bannon, former adviser to President Trump, told The Post about the existence of the hard drive in late September and Giuliani provided The Post with a copy of it on Sunday. [NY Post]

Steve Bannon has since clarified to Revolver News that he was brought into the project based on familiarity with corruption in corporate America, on Wall Street, and within the Chinese Communist Party and America’s political class. Mr. Bannon revealed that he “worked up and executed the roll out plan” of the information contained in the Hunter hard drives. Given his close knowledge and familiarity with an issue of such explosive importance to the election, Revolver asked Mr. Bannon a few questions pertaining to the contents of Hunter’s hard drive and the political implications of their release.

Revolver: What is the most incriminating thing on the hard drive? Rudy has suggested illegal things, and as Revolver reported, the FBI person tasked with the hard drive is associated with the child pornography division. Could you give more insight into how bad it is we’re talking about?

Mr. Bannon: Joe Biden is a liar, a fraud, and compromised by Chinese cash. In short, he is a national security crisis. The hard drive combines emails and text messages that show a massive involvement with companies controlled by the Chinese Communist Party. Also, there are 25,000 images that show a drug-addled, depraved lifestyle — one that decent hardworking Americans will not want near the White House.

Revolver: The FBI has been holding onto the hard drive for almost a year? Any sense of why? Was there any indication that they were seriously interested in a criminal case, assuming that there is, in fact, illegal material on there? If not, why would the FBI simply hold onto information like that?

Mr. Bannon: The President must confront the director of the FBI on why the information housed on this hard drive was not moved on immediately. If the content of the hard drive had been released when received in November 2019, there would have been no impeachment of Trump, and Bernie Sanders would be the Democratic Party nominee. This confrontation should take place this weekend in the Oval Office. If Wray doesn’t have a bulletproof reason he should be fired in the room.

Revolver: What are your best estimates on how many foreign entities may have obtained possession of the hard drive? Chinese intel?

Mr. Bannon: It’s the actions represented on the hard drive that the American people must understand our enemies know about. The cash and equity given for access to Biden, the favors done for that cash, the drugs, the depravity. The CCP, Russian Intel, the Iranian Revolutionary Guard Intel Services — they know the Bidens are for sale.

Revolver: Is there any reason to expect that the contents of the hard drive will be revealed before the election? If yes, will people actually care enough for it to substantially affect the outcome?

Mr. Bannon: The Bidens are about to be hit with multiple stories from multiple media sources based off evidence beyond the hard drive. Fox and Peter Schweitzer have already started but bigger more mainstream companies are going to weigh in. We already have set in motion the various apparatuses that will release everything.

Revolver: What are your thoughts on the efforts to discredit the hard drive as “Russian disinformation?” Is there any evidence this is Russian disinformation at all? At any rate, what matters is not whether Biden-supporting media calls it “disinformation” — what matters is whether it’s true. Has the Biden camp explicitly denied the factual accusations pertaining to the hard drives?

Mr. Bannon: Rupert Murdoch’s team at the NY Post is as sophisticated and tough as there is in all media. They had the metadata and they signed off to go forward. The Russia excuse — and it is an excuse — collapsed when Fox verified the information with someone on the email chain. The Biden campaign has yet to say these emails or photos are not real. The reason? Hunter’s lawyer sent emails trying to recover the hard drive. These are real — the Bidens know they are real — and they are going to have to deal with that reality.

*  *  *

Meanwhile:

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How Big Can the Ninth Circuit Get?

With 29 judges in active service, the U.S. Court of Appeals for the Ninth Circuit is already the nations largest federal appellate court. The court is so large that it does not sit as a full court when sitting en banc. Instead, en banc panels consist of the Chief Judge and ten other judges selected at random.

The Judicial Conference of the United States is recommending the addition of five additional seats to the Ninth Circuit, in addition to 73 district court judgeships around the country (eight of which are temporary judgeships that would be made permanent). These recommendations are based upon the Judicial Conference’s assessment of court caseloads and administrative needs, and were the subject of a Senate Judiciary Committee hearing earlier this year.

The Conference is likely correct that the Ninth Circuit needs more judges to handle the volume of cases within the circuit. The same goes for their district court recommendations. The last time Congress significantly expanded the federal courts was in 1990, and court caseloads have increased substantially since then, particularly in federal district courts. Expanding lower courts to handle the nation’s legal needs is overdue.

While I accept the Judicial Conference’s claim that the nation needs more federal judges, I confess some reluctance to make the Ninth Circuit any larger. It is already an unwieldy court, far larger than any other circuit. While the Judicial Conference is recommending that the Ninth Circuit have over thirty judges, no other circuit court even has twenty—and no other circuit has adopted the Ninth Circuit’s non-banc en banc process.

When Congress gets around to responding to the Judicial Conference’s request, I hope it also gives consideration to splitting the Ninth Circuit into two, more normal-sized courts. In the past, such proposals have foundered on political concerns, such as that California’s influence would overwhelm that of any other states in a newly constituted court. The alternatives of spitting California between two circuits or having a California-only circuit are also less-then desirable. Perhaps so, but it seems to me that a 30-plus judge circuit court is worse. Creating two circuit courts—a California-only court and another consisting of the remainder of the current Ninth—with 18 judges each, would satisfy the need for more judges and cut the current Ninth down to size.

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Deutsche Bank Whistleblower Who Gave Up $8.25 Million Award Is Going Bankrupt

Deutsche Bank Whistleblower Who Gave Up $8.25 Million Award Is Going Bankrupt

Tyler Durden

Sun, 10/18/2020 – 16:35

At the height of the financial crisis, when risk assets were imploding and counterparties were in danger of overnight collapse, Deutsche Bank avoided failure and nationalization by fabricating the value of its $130 billion derivative portfolio of “leveraged super senior” trades.

Some history: back in 2005, these trades were seen as “the next big thing” in the world of credit derivatives, something which DB at the time was building a massive position in. They were designed to behave like the most senior tranche of a typical collateralized debt obligation, where assets such as mortgages or credit default swaps are pooled to give investors varying degrees of risk exposure. Deutsche became the biggest operator in this market, which involved banks buying insurance against the possibility of default by some of the safest companies.

There was just one problem: when it was building up its portfolio, Deutsche never accounted for the possibility of the financial world nearly collapsing. Which is why as the illiquid portfolio was careening, instead marking it to market – an act that would have resulted in the bank’s insolvency – DB’s risk managers misstated the value of the positions by anywhere from $1.5bn to $3.3bn.

Several years later, in 2012, the SEC found out about this, and in 2015 slapped a $55 million fine on Deutsche Bank for this criminal fabrication (of course, nobody went to jail). “At the height of the financial crisis, Deutsche Bank’s financial statements did not reflect the significant risk in these large, complex illiquid positions,” said Andrew Ceresney, then-director of the SEC’s enforcement division (who after his particular “revolving door” is currently a partner in the Litigation Department of Debevoise & Plimpton where he represents the same banks he was prosecuting during his SEC tenure); “Deutsche Bank failed to make reasonable judgments when valuing its positions and lacked robust internal controls over financial reporting”, he said.

Not the reason why the SEC learned about DB’s massive mismarked derivative exposure, is because two former employee whistleblowers, Matthew Simpson and Eric Ben-Artzi, told it: the duo alleged that if Deutsche had accounted properly for its positions, its capital would have fallen to dangerous levels during the financial crisis and it might have required a government bailout to survive. The highest estimate for the unaccounted loss was $12bn. Which explains why Deutsche Bank was desperate to manipulate the numbers.

End result: DB got its wristslap with a token fine, the SEC came out looking like it knew what it was doing, and – as we learned back in August 2016 – the two whistleblowers got major awards for helping the SEC collected the $55MM fine, amounting to 15% each. 

Only, something unexpected happened: one of the whistleblowers who helped expose the false accounting at Deutsche Bank turned down a multimillion-dollar award from the Securities and Exchange Commission in protest against the agency’s failure to punish executives at the bank.

In a move that sent shockwaves across the pragmatic Wall Street, Eric Ben-Artzi, the former Deutsche risk officer, told the SEC he is declining his share of a $16.5 million payout — the third largest in the whistleblower program’s history — which represents 30% of the $55 million Deutsche Bank fine.

But why turn down enough money that most people, even ex-Wall Streeters, could comfortably retire on?  Ben-Artzi said that he could not take money that had been extracted from “Deutsche’s shareholders instead of the managers responsible”, claiming the fine should be paid by individual executives, not shareholders, and suggested the “revolving door” of senior personnel between the SEC and Germany’s largest bank had played a role in executives going unpunished (understandably he had no comment about the spike in Deutsche Bank suicides in 2013-2014, particularly those emanating from its legal department).

“This goes beyond the typical revolving-door story,” Ben-Artzi wrote in an opinion article for the Financial Times. “In this case, top SEC lawyers had held senior posts at the bank, moving in and out of top positions at the SEC even as the investigations into malfeasance at Deutsche Bank were ongoing.”

(Which, incidentally, reminds us of a post we wrote back in May 2010, explaining why former Deutsche Bank General Councel, and then-SEC Director of Enforcement, “Robert Khuzami Stands To Lose Up To $250,000 If He Pursues Action Against Deutsche Bank.” We were right: neither Khuzami, nor the SEC, nor anyone else, pursued any charges against Deutsche Bank in the early years after the financial crisis. In retrospect, now that the German bank has been revealed to have manipulated literally everything, such oversight on behalf of the SEC was even more criminal than what DB did over the years.)

* * *

Long story short, instead of collecting millions of well-deserved dollars, Ben-Artzi displayed a level of idealism never before seen on Wall Street (he did get to write an FT op-ed explaining his bizarre action). Although we wonder if, in retrospect, Ben-Artzi would have reconsidered his idealism for one simple reason: four years later, the man who once worked at Deutsche Bank and then grew the world’s biggest conscience… is going broke.

Fast forward four years from August 2016, when in an update on the current financial state of the 48-year-old former risk manager (and nephew of the wife of Israeli prime minister Benjamin Netanyahu) the Financial Times reports that he is going broke.

“I would need a near miracle to avoid bankruptcy at this point,” said Ben-Artzi from Tel Aviv, where he is in quarantine after a trip to the US. Because ironically, while Ben-Artzi’s “sacrifice” attracted praise from around the world, it was also the subject of heavy fire from his (former) friends and allies.

Eric Ben-Artzi, right, with lawyer Jordan Thomas from Labaton Sucharow in front of the Deutsche Bank HQ in New York.

Start with the ex-wife: after he was fired by Deutsche in 2011, Ben-Artzi went through a bitter divorce; he ended up moving from the US to his native Israel, leaving behind his children and racking up hundreds of thousands of dollars in court fines and child support debts. At one point, a court issued a warrant for his arrest.

Then, his ex-lawyers: the law firm that helped him take his whistleblower claim to the SEC, Labaton Sucharow, sued him in 2015, worried by emails from him that he might refuse the award and deprive them of an agreed 18% fee. 

Then, his expert friends: he was also sued by a Canadian firm, Kilgour Williams, whose principals, Colin Kilgour and Dan Williams, had supported Mr Ben-Artzi’s claim by providing expert testimony.

The irony: while the former risk manager did not take any cash from the reward, he ended up getting stuck with all of the associated liabilities, because ironically unless everyone you are associated with is as idealistic as you are, you end up stuck with the bill.

As the FT reports, when he renounced the $8.25 million award, Ben-Artzi said his ex-wife, his lawyers and advisers should be paid what they were entitled to. But the various legal claims have eroded the whistleblower payout and now threaten to exhaust it completely! And although Mr Ben-Artzi has not personally received a penny, he is likely to be saddled with unmanageable debts.

Not everyone is a loser, of course: for one, there has been some progress in the painful seven-year divorce battle between Ben-Artzi and his ex-wife. He recently saw his two sons for the first time in six years. Not nearly as idealistic as her former husband, the former Ben-Artzi received about half the SEC award.  The lawyers also got paid: Labaton Sucharow collected their fee of $1.5m. 

But the experts at Kilgour Williams have yet to be paid. They had initially agreed to a 3% cut of any payout. This was later changed. In a new arrangement agreed in 2014, Kilgour Williams would receive 5 per cent of any award to Mr Ben-Artzi but would also submit an independent whistleblower claim; if that was successful, Ben-Artzi would receive 60 per cent of the second claim. Then, when Ben-Artzi’s FT article appeared in 2016, the Canadians were furious. Their own whistleblower claim had been rejected and they felt that by turning down his award and embarrassing the SEC, Mr Ben-Artzi had hurt their chances of winning an appeal.

They wrote to Mr Ben-Artzi: “We understand that you regard your share of the award as dirty money and have decided not to personally accept any portion of the award. Therefore, we request that you direct the SEC to direct $2,500,000 to us.” Under the original agreement, Kilgour Williams would have received $247,500. The amended deal would have given them $412,500.

Ben-Artzi first signed a letter agreeing to ask the SEC to send them millions of dollars, roughly equivalent to the remainder of the whistleblower payout.

And then something else happened: reality started seeping through Ben-Artzi’s idealistic facade: as the FT notes, “he then had second thoughts”:

Although Ben-Artzi believed Kilgour Williams deserved to be paid for their work and was unattached to what he did indeed see as “dirty money”, he learnt there was a chance he might have to pay tax on the award even though he had not drawn any of it himself. There was also ongoing litigation with his ex-wife.

The problem is that as a result of the mess his initial “idealistic burst” created, he is now facing financial ruin: Kilgour Williams has maintained that the signed letter was an enforceable contract, creating a $2.5 million debt for Ben-Artzi, which a judge ruled in their favor. Which means that Ben-Artzi – who personally has received nothing – is left worrying whether the remainder of the award will be enough to pay the Canadian advisers, continuing claims from his ex-wife and a potential tax bill. As the FT puts it, “he does not need his PhD in maths to know it does not add up.”

One of his former business partners has little sympathy, noting that — whatever the final outcome — he has been able to create significant wealth for his children through the payments to his ex-wife.

Ben-Artzi’s oredeal is a glaring reminder to all those who wish to wow the world with their idealism not to do it in the middle of a transaction, where many disparate parties are also eager for their pound of flesh. If he was indeed so concerned about DB shareholders, he could just have mailed out the money he received from the SEC to each and everyone one of them, an amount which would have been a laughable pittance when contrasted with the devastation in Deutsche Bank’s stock price since August 2016. In any event, for all those eager to steamroll their pragmatic realism with idealism, first wait until the money hits your bank account… then do whatever you want. Because as a whole generation of newly hatched socialists are about to learn the very hard way, idealism does not pay… in fact, as the now broke Ben-Artzi has found the very hard way, just the opposite.

via ZeroHedge News https://ift.tt/2IB4jSk Tyler Durden

FBI = Disinformation

FBI = Disinformation

Tyler Durden

Sun, 10/18/2020 – 16:10

Authored by Raul Ilargi Meijer via The Automatic Earth blog,

USA Today Headline:

“A Tabloid Got A Trove Of Data On Hunter Biden From Rudy Giuliani. Now, The FBI Is Probing A Possible Disinformation Campaign

(The FBI is examining whether the material supplied to the New York Post by Rudy Giuliani is part of a disinformation campaign by Russia.)”

Seeing that makes me think: with Comey, Strzok, Lisa Page, McCabe et al gone, who initiates and approves such “examinations”?

The aforementioned were all involved in setting up the Special Counsel led by former FBI chief Robert Mueller, and that was the most embarrassing episode in the Bureau’s history. Which is saying something given J. Edgar’s penchant for dressing up in women’s clothing.

The Mueller probe was all predicated on vague and unproven Russian “disinformation”, and it fittingly ended with it too. With absolutely nothing coming out of the probe, that was based on the Steele Dossier which the protagonists knew was false even before the probe started, Mueller and his right-hand Andrew Weismann in the end had nothing left but “13 Russians” and Julian Assange to “justify” their $30 million, 2 year “effort”.

The only people they could lay any -always unproven- blame or suspicion on were those who could not defend themselves against false accusations. And when Concord Management unexpectedly did raise a defense, Mueller was shut down by a US judge in no time. It’s pathetic. Mueller’s a liar and a coward, as I’ve said a dozen times now. He should be exiled to Mars.

But what’s worse than his reputation having been destroyed, is that he and his pals hammered the FBI’s reputation as well. So when I read in October 2020 that “The FBI Is Probing A Possible Disinformation Campaign by Russia”, I’m obliged to ask: where does that come from?

Because apparently at least some things haven’t changed yet, despite the Mueller horror show. What the FBI needs is a thorough cleansing, not another nonsensical politically driven opaque “investigation” of Russians. The obvious problem, of course, is that the same media who edged on that disaster will also report on this one without an inch of actual journalistic curiosity or integrity.

The media are in the same political wing as the FBI. They are all counting down the days until November 3, and they are all counting on their mishaps and misdeeds being forgiven and/or buried deep if Joe Biden wins, something they spare no effort to achieve.

But unlike the Democrats, in their present-day DNC, Hillary, Pelosi et al, setting, and the mainstream media, who have lost all credibility, the FBI will have a role to play in the future of America. All of the above have been caught in scandalous endeavors to halt a presidential candidate and then unseat a president, but unlike in the case of the Democrats and the media, the nation itself actually has the means to change the FBI.

And it will have to. Because it needs a domestic intelligence service that can go after people who attempt to subvert the workings -and laws- of American society. But yes, that means people like themselves. And once the FBI becomes complicit in such subversion, there is no-one left to investigate them. A classic problem, who will investigate the investigators?

Sure, in “normal” times that should be the House, but the Democrat House is also part of the entire “cabal”. Just remember Adam Schiff’s and Jerry Nadler’s shameless statements of having evidence of collusion when they very obviously did not. So that’s not going to happen. Or at least, that’s what they all think. But it must, Biden victory or not.

Ironically, an Amy Coney Barrett confirmation for the Supreme Court, in that regard, may be seen as a move to save the country, to save the integrity and moral fiber of the United States. Because if the House won’t, and the Senate can’t, save the country from the FBI turning rogue and siding with one side of the political system , the Supreme Court will have to. Or else.

A vote for Joe Biden is a vote for the entire DNC-FBI-MSM cabal. Which counts on all they’ve done to magically disappear under President Kamala. And that is not going to happen. If the FBI and Capitol Hill will not see to it, the judicial system will. How big a role Michael Flynn lawyer Sidney Powell will play in that depends on how much people like Bill Barr are willing to take on, but Powell is up to the task.

Of course there are legitimate questions about how exactly the New York Post and Rudy Giuliani got hold of the emails and other Hunter Biden-related material. But the fact that the Biden campaign after three days still hasn’t disputed its veracity is a major tell. All they have done is point to Russian disinformation -again- and now the FBI is “investigating” that. The exact same thing Mueller failed to prove.

In other words, we’re still caught in a circle-jerk, only now Facebook and Twitter have joined in too. But the real question should not be about the Russians, that’s always only been a ruse. It should be: how do we restore the reputation and credibility of the FBI that was so thoroughly annulled over the past 5 years?

If Biden wins, nothing will be restored. Because the FBI helped him win. If Trump wins, there’s a slightly better chance. Then again, Trump’s presidency didn’t change much. Comey, Strzok and McCabe disappeared, but new chief Christopher Wray is out there frustrating declassifications, and approving brainless probes like Russian disinformation in the Hunter Biden laptop case.

Which is not just useless, it’s an active attempt to direct attention away from what is actually there: the contents of the laptop. Which, again, remains uncontested by the Biden campaign.

If the FBI cannot be perceived by the American people as an impartial bureau, that will be a very big problem for many years to come. If people fear that it may -again- turn against a presidential candidate for partisan reasons, and lie through their teeth to achieve their goals, that will be it for the Bureau.

*  *  *

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via ZeroHedge News https://ift.tt/2FFk1Lf Tyler Durden

Twitter Silences Top Trump COVID Task Force Expert

Twitter Silences Top Trump COVID Task Force Expert

Tyler Durden

Sun, 10/18/2020 – 15:45

Social media companies and mainstream media outlets are on a crusade, censoring anyone who challenges the “official” science and narrative behind the COVID-19 virus. It was only last week when Twitter removed New York Post’s bombshell stories about Hunter Biden. Then later in the week, Amazon purged political writer James Perloff’s latest book, “Covid-19 and the Agendas to Come: Red-Pilled,” from its platform for “violating content guidelines.”

With America descending deeper into an Orwellian state – Twitter has yet again banned another tweet, this time on Saturday, from Stanford professor and now White House advisor Scott Atlas. 

Atlas tweeted Saturday morning that masks do not work to prevent the spread of the virus: 

“Masks work? NO: LA, Miami, Hawaii, Alabama, France, Philippines, UK, Spain, Israel. WHO: “widespread use not supported” + many harms; Heneghan/Oxf CEBM: “despite decades, considerable uncertainty revalue”; CDC rvw May: “no sig red’n in inflnz transm’n”; learn why.”

Hours later, in a follow-up tweet, Atlas wrote:

 “That means the right policy is @realDonaldTrump guideline: use masks for their intended purpose — when close to others, especially hi risk. Otherwise, social distance. No widespread mandates.”

As per a CNN report, Atlas’ tweet violated Twitter’s policy that “prohibits sharing false or misleading content related to Covid-19 that could lead to harm.” 

The Federalist points out, in an emailed response via Atlas, an array of scientific data to back up his claim: 

In the deleted tweet, I cited the following evidence against general population masks:

1) Cases exploded even with mandates: Los Angeles County, Miami-Dade County, Hawaii, Alabama, the Philippines, Japan, the United Kingdom, Spain, France, Israel.

2) Dr. Carl Heneghan, University of Oxford, director of the Centre for Evidence-Based Medicine and editor in chief of British Medical Journal Evidence-Based Medicine: ‘It would appear that despite two decades of pandemic preparedness, there is considerable uncertainty as to the value of wearing masks.’

(https://www.cebm.net/covid-19/masking-lack-of-evidence-with-politics/)

3) The WHO: ‘The widespread use of masks by healthy people in the community setting is not yet supported by high quality or direct scientific evidence and there are potential benefits and harms to consider’ (http://bitly.ws/afUm)

4) The CDC: ‘Our systematic review found no significant effect of face masks on transmission of laboratory-confirmed influenza.’ (https://wwwnc.cdc.gov/eid/article/26/5/19-0994_article).

I also cited an article giving a detailed explanation of the reasons why masks might not prevent spread:  https://t.co/1hRFHsxe59

The tweet and surrounding removal from Twitter come as US COVID-19 cases in the US surged above 70,000 on Friday, the highest daily reading since July 24. Atlas’ tweet was also linked to an article in the American Institute for Economic Research that argues masks are not effective against the virus. 

By trade, Atlas is a distinguished neuroradiologist, though he is not an expert in infectious diseases. He’s gained a lot of attention on Fox News for his aggressive reopening strategies. He’s also in favor of the herd immunity strategy, in which elderly and vulnerable populations need to be protected. In contrast, he says, younger segments of the population are allowed to keep working and consuming. 

Atlas’ former Stanford colleagues recently attacked him in a letter. Here’s what they said: 

“To prevent harm to the public’s health, we also have both a moral and ethical responsibility to call attention to the falsehoods and misrepresentations of science recently fostered by Dr. Scott Atlas, a former Stanford Medical School colleague and current senior fellow at the Hoover Institute at Stanford University. Many of his opinions and statements run counter to established science and, by doing so, undermine public-health authorities and the credible science that guides effective public health policy.”

Atlas has seen his fair share of bans; not too long ago, the Hoover Institution released Atlas’s interview on YouTube, where the social media platform took down the video. 

Alex Berenson, a former New York Times reporter who has been skeptical about the dangers surrounding the virus pandemic – recently tweeted:

“My (non-N95) mask protects me… 1 percent of the time.” 

Berenson appears to back up the tweet with CDC data… 

Banning of alternative views, or maybe, even ones backed by science, if it goes against the official narrative, the leftist thought police will be out in force to censor.  

This is a genuinely Orwellian culture. And if social media and mainstream media can silence a top government expert – they can silence anyone… 

via ZeroHedge News https://ift.tt/31lGwfJ Tyler Durden

Does This Explain Why Facebook Was So Quick To Suppress Hunter Biden Revelations?

Does This Explain Why Facebook Was So Quick To Suppress Hunter Biden Revelations?

Tyler Durden

Sun, 10/18/2020 – 15:20

Authored by Andrea Widburg via AmericanThinker.com,

The moment the New York Post reported on some of the sleazy, corrupt details contained on Hunter Biden’s hard drive, Twitter and Facebook, the social media giants most closely connected to the way Americans exchange political information, went into overdrive to suppress the information and protect Joe Biden. In the case of Facebook, though, perhaps one of those protectors was, in fact, protecting herself.

The person currently in charge of Facebook’s election integrity program is Anna Makanju. That name probably doesn’t mean a lot to you, but it should mean a lot – and in a comforting way — to Joe Biden.

Before ending up at Facebook, Makanju was a nonresident Senior Fellow at the Atlantic Council. The Atlantic Council is an ostensibly non-partisan think tank that deals with international affairs. In fact, it’s a decidedly partisan organization.

In 2009, James L. Jones, the Atlantic Council’s chairman left the organization to be President Obama’s National Security Advisor. Susan Rice, Richard Holbrooke, Eric Shinseki, Anne-Marie Slaughter, Chuck Hagel, and Brent Scowcroft also were all affiliated with the Atlantic Council before they ended up in the Obama administration.

The Atlantic Council has received massive amounts of foreign funding over the years. Here’s one that should interest everyone: Burisma Holdings donated $300,000 dollars to the Atlantic Council, over the course of three consecutive years, beginning in 2016. The information below may explain why it began paying that money to the Council.

Not only was the Atlantic Council sending people into the Obama-Biden administration, but it was also serving as an outside advisor. And that gets us back to Anna Makanju, the person heading Facebook’s misleadingly titled “election integrity program.”

Makanju also worked at the Atlantic Council. The following is the relevant part of Makanju’s professional bio from her page at the Atlantic Council (emphasis mine):

Anna Makanju is a nonresident senior fellow with the Transatlantic Security Initiative. She is a public policy and legal expert working at Facebook, where she leads efforts to ensure election integrity on the platform. Previously, she was the special policy adviser for Europe and Eurasia to former US Vice President Joe Biden, senior policy adviser to Ambassador Samantha Power at the United States Mission to the United Nations, director for Russia at the National Security Council, and the chief of staff for European and NATO Policy in the Office of the Secretary of Defense. She has also taught at the Woodrow Wilson School at Princeton University and worked as a consultant to a leading company focused on space technologies.

Makanju was a player in the faux Ukraine impeachment. Early in December 2019, when the Democrats were gearing up for the impeachment, Glenn Kessler mentioned her in an article assuring Washington Post readers that, contrary to the Trump administration’s claims, there was nothing corrupt about Biden’s dealings with Ukraine. He made the point then that Biden now raises as a defense: Biden didn’t pressure Ukraine to fire prosecutor Viktor Shokin to protect Burisma; he did it because Shokin wasn’t doing his job when it came to investigating corruption.

Kessler writes that, on the same day in February 2016 that then-Ukrainian President Poroshenko announced that Shokin had offered his resignation, Biden spoke to both Poroshenko and Prime Minister Arseniy Yatsenyuk. The White House version is that Biden gave both men pep talks about reforming the government and fighting corruption. And that’s where Makanju comes in:

Anna Makanju, Biden’s senior policy adviser for Ukraine at the time, also listened to the calls and said release of the transcripts would only strengthen Biden’s case that he acted properly. She helped Biden prepare for the conversations and said they operated at a high level, with Biden using language such as Poroshenko’s government being “nation builders for a transformation of Ukraine.”

A reference to a private company such as Burisma would be “too fine a level of granularity” for a call between Biden and the president of another country, Makanju told The Fact Checker. Instead, she said, the conversation focused on reforms demanded by the International Monetary Fund, methods to tackle corruption and military assistance. An investigation of “Burisma was just not significant enough” to mention, she said.

Let me remind you, in case you forgot, that Burisma started paying the Atlantic Council a lot of money in 2016, right when Makanju was advising Biden regarding getting rid of Shokin.

In other words, there’s a really good chance that Sundance was correct when he wrote at The Conservative Treehouse:

That’s right folks, the Facebook executive currently blocking all of the negative evidence of Hunter and Joe Biden’s corrupt activity in Ukraine is the same person who was coordinating the corrupt activity between the Biden family payoffs and Ukraine.

You just cannot make this stuff up folks.

The incestuous networking between Democrats in the White House, Congress, the Deep State, the media, and Big Tech never ends. That’s why the American people wanted and still want Trump, the true outsider, to head the government. They know that Democrats have turned American politics into one giant Augean Stable and that Trump is the Hercules who (we hope) can clean it out.

via ZeroHedge News https://ift.tt/3obcaXl Tyler Durden