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This afternoon, Judge Amit Mehta of the U.S. District Court of the District of Columbia rejected President Donald Trump’s attempt to block a congressional subpoena seeking financial records from Trump’s accountants.

Here is the introduction to Judge Mehta’s opinion in Trump v. Committee on Oversight and Reform:

I do, therefore, . . . solemnly protest against these proceedings of the House of Representatives, because they are in violation of the rights of the coordinate executive branch of the Government, and subversive of its constitutional independence; because they are calculated to foster a band of interested parasites and informers, ever ready, for their own advantage, to swear before ex parte committees to pretended private conversations between the President and themselves, incapable, from their nature, of being disproved; thus furnishing material for harassing him, degrading him in the eyes of the country . . .

– President James Buchanan

These words, written by President James Buchanan in March 1860, protested a resolution adopted by the U.S. House of Representatives to form a committee—known as the Covode Committee—to investigate whether the President or any other officer of  the Executive Branch had sought to influence the actions of Congress by improper means. . . . Buchanan “cheerfully admitted” that the House of Representatives had the authority to make inquiries “incident to their legislative duties,” as “necessary to enable them to discover and to provide the appropriate legislative remedies for any abuses which may be ascertained.” But he objected to the Covode Committee’s investigation of his conduct. He maintained that the House of Representatives possessed no general powers to investigate him, except when sitting as an impeaching body. Buchanan feared that, if the House were to exercise such authority, it “would establish a precedent dangerous and embarrassing to all my successors, to whatever
political party they might be attached.”

Some 160 years later, President Donald J. Trump has taken up the fight of his predecessor. On April 15, 2019, the Committee on Oversight and Reform of the House of Representatives issued a subpoena for records to Mazars USA LLP, a firm that has provided accounting services to President Trump. The subpoena called for Mazars to produce financial records and other documents relating to President Trump personally as well as various associated businesses and entities dating back to 2011—years before he declared his candidacy for office. The decision to issue the subpoena came about after the President’s former lawyer and confidant, Michael Cohen, testified before the House Oversight Committee that the President routinely would alter the estimated value of his assets and liabilities on financial statements, depending on the purpose for which a statement was needed. For instance, Cohen said that the President provided inflated financial statements to a bank to obtain a loan to purchase a National Football League franchise. But when it came time to calculate his real estate taxes, the President would deflate the value of certain assets. To support his accusations, Cohen produced financial statements from 2011, 2012, and 2013, at least two of which were prepared by Mazars.

Echoing the protests of President Buchanan, President Trump and his associated entities are before this court, claiming that the Oversight Committee’s subpoena to Mazars exceeds the Committee’s constitutional power to conduct investigations. The President argues that there is no legislative purpose for the subpoena. The Oversight Committee’s true motive, the President insists, is to collect personal information about him solely for political advantage. He asks the court to declare the Mazars subpoena invalid and unenforceable.

Courts have grappled for more than a century with the question of the scope of Congress’s investigative power. The binding principle that emerges from these judicial decisions is that courts must presume Congress is acting in furtherance of its constitutional responsibility to legislate and must defer to congressional judgments about what Congress needs to carry out that purpose. To be sure, there are limits on Congress’s investigative authority. But those limits do not substantially constrain Congress. So long as Congress investigates on a subject matter on which “legislation could be had,” Congress acts as contemplated by Article I of the Constitution.

Applying those principles here compels the conclusion that President Trump cannot block the subpoena to Mazars. According to the Oversight Committee, it believes that the requested records will aid its consideration of strengthening ethics and disclosure laws, as well as amending the penalties for violating such laws. The Committee also says that the records will assist in monitoring the President’s compliance with the Foreign Emoluments Clauses. These are facially valid legislative purposes, and it is not for the court to question whether the Committee’s actions are truly motivated by political considerations. Accordingly, the court will enter judgment in favor of the Oversight Committee.

 

No doubt this opinion will be appealed. Trump’s attorneys may succeed in obtaining a stay, or otherwise slowing down these proceedings, but I expect they will ultimately be unsuccessful.

Assuming Congress must be able to identify a legitimate legislative purpose when seeking such information, Judge Mehta is correct to conclude that that any such requirement is amply satisfied here. The President is not a private individual. His financial information is relevant to the legislature’s authority to determine whether foreign emoluments are to be permitted and under what conditions, as well as to whether presidential conduct implicates his oath of office or could justify an impeachment inquiry. Whether or not relevant legislation has been introduced or a formal impeachment inquiry has been opened is irrelevant, as Congress is not required to introduce legislation before investigating whether any such legislation is desirable, nor is Congress required to open a formal impeachment proceeding before looking into whether such a proceeding would be justified, and it would be a stark departure from traditional separation of powers norms for a court to conclude otherwise.

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We begin this episode with a quick tour of the 5-4 Apple antitrust decision that pitted two Trump appointees against each other. Matthew Heiman and I consider the differences in judging styles that produced the split—and the role that 25 years of living with Silicon Valley “platform billionaires” may have played in the decision.

Eric Emerson joins us for the first time to talk about the legal fallout from the latest tariff increases on Chinese products. Short version: companies have some short-term tactics to explore (country of origin, drawback, valuation), but large importers/resellers will have to grapple with larger and costlier strategies of supply chain diversification and localization.

Meanwhile, China has not been taking the trade war lying down. In addition to its own tariff increases, it now seems to be enforcing its demanding cybersecurity law more aggressively against foreign firms. I suggest that we may also be seeing retaliation in Chinese courts as well.

In related news, Nick Weaver and I debate the potentially sweeping new Executive Order on Securing the Information and Communications Technology and Services Supply Chain.

Maury Shenk explains the UK Supreme Court ruling that expands the court’s authority over the UK’s intelligence agencies—despite clear Parliamentary language to the contrary. Bottom line: Bad news for UK intelligence. Hidden good news for the US: Turns out that there is something worse than activist judges interpreting a written constitution – activist judges who can more or less make up the constitution they interpret.

It was a cybersecurity disaster week for some of the biggest names in tech. Nick helps me understand which bugs were worst, Cisco’s, Intel’s, or Microsoft’s. Then we review the equally bad week that the NSO Group and its WhatsApp exploit had.

Cleaning up in a lightning round:  We cover the order requiring the Chinese owner of Grindr to sell by mid-2020. We also cover Canada’s approach to social media, which spurs me to offer unwonted praise for France’s Macron and his moderation. The EU has a plan for sanctions on cyberattackers; Matthew and I doubt it will get much use. Is too much fuss being made over leak investigators using Web bugs to see if defense counsel at Guantanamo have been leaking; Nick and I disagree, at least a bit.

And the podcast closes with yet another installment in our long-running feature, “This Week in Internet Sex Toy Law.” Suffice it to say that the latest case can’t be understood without consulting both Orin Kerr and Jerry Seinfeld.

Download the 264th Episode (mp3).

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The views expressed in this podcast are those of the speakers and do not reflect their firms, clients, spouses, or families.

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Give The New York Times credit for publishing, over the weekend, a long investigative piece about the strange enthusiasm of Democratic presidential candidate Bernie Sanders for the communist strongman Daniel Ortega, who ruled Nicaragua in the 1980s and is in power there again today.

It bears remembering, though, that the group of Democratic presidential candidates who might be described as Ortega groupies extends well beyond the self-described socialist senator from Vermont.

One of the newest additions to the Democratic presidential field is the mayor of New York, Bill de Blasio. The Times reported back in 2013 that during the 1980s, de Blasio “helped raise funds for the Sandinistas in New York and subscribed to the party’s newspaper, Barricada, or Barricade.”

Sanders visited Nicaragua in 1985; de Blasio went there in 1988.

The Times reported that in the late 1980s, when Ortega was in power, de Blasio “oversaw efforts to solicit and ship millions of dollars in food, clothing and supplies to Nicaragua.” The Times reported in 2013 that de Blasio “to this day…speaks admiringly of the Sandinistas’ campaign.”

Then there’s the man polls indicate is the front-runner for Democratic presidential nomination, Joe Biden. A former aide to George W. Bush, Peter Wehner, has written in the Wall Street Journal that “In the early 1980s, the U.S. was engaged in a debate over funding the Contras, a group of Nicaraguan freedom fighters attempting to overthrow the Communist regime of Daniel Ortega. Mr. Biden was a leading opponent of President Ronald Reagan’s efforts to fund the Contras.”

The voting records bear that out. On October 3, 1984, Biden voted to prohibit the Reagan administration from spending money against Nicaragua from the intelligence budget. The amendment was rejected, 42-57. On June 6, 1985, the Senate approved an amendment offered by Georgia Democrat Sam Nunn to release $38 million in humanitarian aid to the Contra rebels fighting Ortega’s Sandinistas. The amendment passed, but Biden was one of 42 Senators who opposed it. Both votes wound up on the annual scorecards of Americans for Democratic Action, a liberal interest group.

Biden voted again in March 1987 for halting aid to the Contras. In 1986 Biden wanted to require the Reagan administration to negotiate with Ortega’s government before sending any money to the contras.

Somewhat comically, Biden fetched up in December 2018 with a piece in Americas Quarterly headlined “The Western Hemisphere Needs U.S. Leadership.” Now, Biden concedes, “Instead of respecting the will of their people, the governments of Nicolás Maduro in Venezuela and Daniel Ortega in Nicaragua have confronted peaceful protesters with force, even armed vigilantes. They have limited the freedoms of expression and assembly necessary for political dialogue and arrested their political opponents.”

In fairness to Biden, one can be a critic of a regime, a leader, or its polices while simultaneously thinking that it is unwise for the American government to provide financial support to a group dedicated to overthrowing that regime. Just as President Trump is hesitant to move militarily against Iran for fear of repeating the Iraq War, politicians in the 1980s were hesitant to back anticommunist forces for fear of repeating the Vietnam War.

For Democrats hoping to run against President Trump in 2020, though, the Ortega story is a complexifier. It makes it harder for Democrats to criticize Trump for cozying up to North Korea if the Democrats themselves were cozying up to Ortega. It makes it harder for Democrats to criticize Trump as an isolationist who is abandoning U.S. interests and principles overseas if the Democrats themselves wanted to cut loose the Contras and consign the people of Nicaragua to a communist authoritarian strongman.

The real resonance, though, has less to do with Daniel Ortega and Nicaragua as a foreign policy case about the merits of American intervention, and more to do with the threat of Ortega-style policies here in the United States. Reasonable people may disagree about how involved America should get in rescuing Nicaragua from socialism. What’s troubling, though, is the idea that a significant wing of the Democratic party might want to emulate precisely the policies—redistribution, central planning, disrespect of property rights—that have left Nicaragua as the poorest country in Central America.

If President Trump wants to illuminate the point, he might offer the Nicaraguan strongman a visa to the United States. Let Ortega campaign alongside Sanders, de Blasio, and Biden in New Hampshire, South Carolina, Pennsylvania, Wisconsin, and Iowa. Let the 2020 Democrats compete for the Bolshevik comandante‘s endorsement.

Ira Stoll is editor of FutureOfCapitalism.com and author of JFK, Conservative.

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Meth dealing. Money laundering. Murder.

These are just a few of the crimes for which members of the Southern California-based Mongols Motorcycle Club have been arrested. But regardless of the crimes they stand accused of committing while wearing the Mongols patch, Central District of California Court Judge David O. Carter recently thwarted yet another attempt by federal law enforcers to confiscate the bike club’s brand.

During a sentencing hearing on Friday for racketeering charges against the entirety of the Mongol Nation, Carter ordered the club to pay a fine of $500,000 and serve five years probation. When prosecutors also asked Carter to forfeit the Mongols’ trademark for their patch, which bears a figure on a motorcycle resembling Genghis Khan, Carter ruled against the request.

The feds have been after the Mongol patch for years, arguing that displaying the logo is as dangerous as the crimes committed by the club members. As previously reported at Reason, the long legal fight brings together free speech violations, asset forfeiture, and intellectual property. When prosecutors received pretrial authority to go after the patch in 2008, law enforcement confiscated jackets and other items bearing the imagery despite not filing charges for a crime.

Prosecutors briefly enjoyed a win when a California jury decided in January that they could take the trademarked patch away from the group. This decision was eventually overturned by Carter in February. He concluded that the seizure of the trademark violated the First Amendment right to free expression and the Eighth Amendment protection from excessive punishment.

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So Game of Thrones is finis. This seems like a good time to recount how various consumer brands riffed off the show, even episodes depicting what were essentially war crimes. (In the second-to-last episode of the series, Daenerys Targaryen kills thousands of innocent city dwellers with the help of her fire-breathing dragon. As the official Snickers Twitter feed puts it, “Not smooth.”)

Indeed, the speed with which brands hitched their wagon to the show demonstrates what the German poet Hans Magnus Enzensberger bemoaned as “the capacity of the capitalist society to reabsorb, suck up, swallow, ‘cultural goods’ of widely varying digestibility” (so too does the rise of Che Guevara t-shirts and t-shirts satirizing those shirts). Joseph Schumpeter famously identified “the perennial gale of creative destruction” as the “essential fact about capitalism.” In response to ever-shifting demands from consumers, producer are “incessantly revolutioniz[ing] the economic structure from within, incessantly destroying the old one, incessantly creating a new one.”

So it is also with cultural expression, especially in an age of meme-ing, deep fakes, and nearly frictionless reproduction. Now more than ever, pop culture (including advertising) is a perpetual meaning machine in which appropriation, reappropriation, and misappropriation are ubiquitous and inevitable. Because of the rise of empowering technology and the related breakdown of gatekeepers, more of us than ever before are joining a conversation once restricted to the high priests of politics, the academy, or the corporate suite.

Folks who believe we are in the days of “late capitalism”—the period in which the internal contradictions outlined by Marx and Engels are becoming visible, suggesting we are only days, months, or years from a proletarian revolution—might want to chomp on a Snickers themselves. In the past couple of decades, increases in international trade have helped to lift billions out of poverty and, even more amazingly, deliver middle-class standards of living to a majority of the planet’s population. T

he internet is awash in user-generated content, and whatever you can say about social media, it’s made more of us participants rather than mere observers in our culture. That’s all very smooth.

Here are some Twitter ads featuring Game of Thrones (courtesy of Lexy Garcia). Enjoy them before we all move on the next thing.

Well, wish I thought of this earlier.

…The Nut King

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( ???? _???? ) ????
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<( ) —–????
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/ ????
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|| || ????

— Mr. Peanut (@MrPeanut) May 19, 2019

When the hanger sets in, “TOAST THEM ALL” ????????????

— Subway® (@SUBWAY) May 13, 2019

Burn a city to the ground after it surrenders? Not smooth. Eat a Creamy SNICKERS. #GameofThrones ????????

— SNICKERS® (@SNICKERS) May 13, 2019

So… who will be on top tonight (i.e.: sit on the throne when all is said and done)? Perhaps we can offer this solution and have the best of both worlds. pic.twitter.com/rjVuznoQ2c

— Trojan Brand Condoms (@TrojanCondoms) May 19, 2019

 

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