Month: August 2017

Cory Booker’s Revolutionary Marijuana Reform Bill Doesn’t Have a Snowball’s Chance in Hell

Sen. Cory Booker (D-NJ) today introduced a far-reaching marijuana reform bill that will likely never come up for a vote or obtain a single Republican co-sponsor.

In a universe where it stood even the slightest chance of being passed into law, the Marijuana Justice Act of 2017 would remove marijuana from the federal drug schedule, allow all current federal marijuana prisoners to petition for new sentences, expunge the convictions of former federal marijuana prisoners, withhold federal law enforcement funding from states that do not liberalize their own marijuana laws, and create a community reinvestment fund for communities affected by the drug war, to which Congress will appropriate $500 million a year, every year, until 2040.

Booker’s bill essentially forces all of the states to legalize marijuana–or go without federal funding for law enforcement and prisons–and currently has zero co-sponsors.

Booker is not the first person to introduce a federal marijuana reform bill that will never see the Senate (or House) floor. Reps. Ron Paul and Barney Frank introduced the first federal repeal bill way back in 2011. That bill called for the repeal of federal prohibition and for states to set their own marijuana policies. In addition to Paul and Frank, there were four Democratic co-sponsors.

Booker addressed the incoherence of maintaining federal prohibition while states forge ahead with various legalization schemes during a Facebook Live event at 12:30 p.m. today. He decried the cruelty of denying veterans an alternative to prescription drugs, and outlined the disparate impact marijuana laws have on communities of color.

His reasons for reforming federal marijuana laws are as good as his legislation is bad.

Congress is closer to revisiting marijuana’s place in Schedule I than it has ever been. Just last week, Rep. Trey Gowdy, a Republican congressman from South Carolina and a former prosecutor, grilled the interim director of the Office of National Drug Control Policy as to why marijuana is in a more restrictive schedule than cocaine and amphetamines.

But if you wanted to craft a bill that would alienate Republicans in Washington, D.C., and governors and state legislators of both parties across the country, you’d be hard pressed to surpass the Marijuana Justice Act of 2017.

Booker’s bill would ensure the federal government would provide nothing for prison maintenance, construction, or staffing to any state in which the percentage of minorities arrested or convicted for a marijuana-related offense exceeded the percentage of minorities in the overall state population. And reduce federal funding for state and local law enforcement by 10 percent.

Recidivism reduction and drug rehab funding would be exempt from this rule, but you’d need an army of Government Accountability Office inspectors to keep state facilities compliant. As with equitable sharing reviews, inspectors would be able to tackle only a few facilities at a time, and only several years after the fact. (In the alternate universe where this bill gets so much as a committee hearing, congressional delegates from states likely to be affected strangle this provision before lunch.)

And then there’s the $500 million-per-year Community Reinvestment Fund, some of which would be diverted from non-compliant states. The rest would simply be appropriated. Booker chose not to include a federal excise tax on marijuana sales. (Could it be that this is not a serious bill?)

The fund would pay for reentry services, job training, and “expenses related to the expungement of convictions,” as well as “public libraries, community centers, and programs and opportunities dedicated to youth.”

Library funding in a marijuana reform bill doesn’t fly, even on Earth 2.

The most reasonable provision in the bill is re-sentencing for current federal pot prisoners. When the U.S. Sentencing Commission changed the federal sentencing guidelines for drug offenses in April 2014, it voted later that year to allow more than 40,000 prisoners to petition for shorter sentences, in line with what they would’ve received had they been sentenced under the new guidelines.

Congress had the opportunity to intervene, but didn’t. The Sentencing Commission could do something like that again, but they wouldn’t be able help federal pot prisoners serving mandatory minimums. Only Congress can do that, and thus far, it hasn’t even when the opportunity presented itself.

After passage of the Fair Sentencing Act in 2010, which effectively increased the quantity of crack-cocaine required to trigger a federal mandatory minimum, criminal justice reformers encouraged Congress to make those changes retroactive. Seven years later, neither the Senate nor the House has come close to doing so.

The most viable proposal in Booker’s bill isn’t viable.

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The Fed’s Monetary Tantrum Will Push The Economy Into Outright Deflation

Via MauldinEconomics.com,

It is increasingly evident that the US economy is not taking off like some predicted after the election.

President Trump and the Republicans haven’t passed any of the fiscal stimulus measures we hoped to see. Banks and energy companies have got some regulatory relief, and that helps. But it’s a far cry from the sweeping healthcare reform, tax cuts, and infrastructure spending we were promised.

Serious, major tax reform could postpone a US recession to well beyond 2020, but what we are going to get instead is tinkering around the edges.

On the bright side, unemployment has fallen further, and discouraged workers are re-entering the labor force. But consumer spending is still weak, so people may be less confident than the sentiment surveys suggest.

Inflation has perked up in certain segments like healthcare and housing, but otherwise it’s still low to nonexistent.

Is this, by any stretch of the imagination, the kind of economy in which the Federal Reserve should be tightening monetary policy?

No – yet the Fed is doing so.

Making Up for Past Mistakes

It’s partly because they waited too long to end QE and to begin reducing their balance sheet.

FOMC members know they are behind the curve, and they want to pay lip service to doing something before their terms end. Plus, Janet Yellen, Stanley Fischer, and the other FOMC members are religiously devoted to the Phillips curve.

That theory says unemployment this low will create wage-inflation pressure. That no one can see this pressure mounting seems not to matter: It exists in theory and so must be countered.

The attitude among central bankers, who are basically all Keynesians, is that messy reality should not impinge on elegant theory. You just have to glance at the math to recognize the brilliance of the Phillips curve!

It was Winston Churchill who said, “However beautiful the strategy, you should occasionally look at the results.” Fact is, the lack of wage growth among the bottom 70–80% of workers (the Unprotected class) constitutes a real weakness in the US economy.

If you are a service worker, competition for your job has kept wages down.

It Will Backfire in a Big Way

The risk here is that the Fed will tighten too much, too soon.

We know from recent FOMC minutes that some members have turned hawkish in part because they wanted to offset expected fiscal stimulus from the incoming administration. That stimulus has not been coming, but the FOMC is still acting as if it will be.

What happens when the Fed raises interest rates in the early, uncertain stages of a recession instead of lowering them? I’m not sure we have any historical examples to review. Logic suggests the Fed will curb any inflation pressure that exists and push the economy into outright deflation.

Deflation in an economy as debt-burdened as ours is could be catastrophic.

We would have to repay debt with cash that is gaining purchasing power instead of losing it to inflation. Americans have not seen this happen since the 1930s. It wasn’t fun then, and it would be even less fun now.

Worse, I doubt Trump’s FOMC appointees will make a difference. Trump appears to be far more interested in reducing the Fed’s regulatory role than he is in tweaking its monetary policies.

Let me make an uncomfortable prediction: I think the Trump Fed—and since Trump will appoint at least six members of the FOMC in the coming year, it will be his Fed—will take us back down the path of massive quantitative easing and perhaps even to negative rates if we enter a recession.

The urge to “do something,” or at least be seen as trying to do something, is just going to be too strong.

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US Air Force To Test Launch ICBM From California Tonight

Tonight the U.S. Air Force will test launch an unarmed Minuteman 3 intercontinental ballistic missile California, its fourth such test in 2017.  The 30th Space Wing says the missile was to be launched between 12:01 a.m. and 6:01 a.m. Wednesday from Vandenberg Air Force Base, located 130 miles northwest of Los Angeles.

In a statement, Vandenberg base said the test would show the “effectiveness, readiness, and accuracy” of the weapon system.

Col. Michael Hough, 30th Space Wing commander, is the launch decision authority. “Team V is postured to work with Air Force Global Strike Command to test launch the Minuteman III missile,” said Hough. “Our long history in partnering with the men and women of the 576th Flight Test Squadron shows that the Western Range stands ready and able to create a safe launch environment.”

The 576th Flight Test Squadron will be responsible for installed tracking, telemetry, and command destruct systems on the missile.

* * *

While Minuteman missiles are regularly tested with launches from Vandenberg that send unarmed re-entry vehicles 4,200 miles (6,800 kilometers) across the Pacific to a target area at Kwajalein Atoll, the latest U.S. launches come amid tensions with North Korea as that nation develops its own ICBMs.

According to military analysts, who analyzed North Korea’s latest, 2nd in one month ICBM test, a broad part of the mainland United States, including Los Angeles and Chicago, is now in range of Pyongyang’s weapons. In response to last Friday’s launch, the U.S. Air Force flew two B-1 bombers over the Korean Peninsula on Sunday in a show of force. The U.S. also said it conducted a successful test of a missile defense system located in Alaska.

Speaking to repoters, on Tuesday afternoon Rex Tillerson said that the US is not seeking regime change in North Korea, adding ” we are not your enemy”, although he conceded that the US is seeking to apply “peaceful pressure” on the Kim regime. He also clarified that the US does not blame China for the situation in North Korea, but wants it to use its economic leverage on Pyongyang. From Reuters:

  • U.S. SECRETARY OF STATE TILLERSON SAYS U.S. IS SEEKING TO APPLY “PEACEFUL PRESSURE” ON NORTH KOREA, SAYS OPTIONS ARE LIMITED
  • U.S. SECRETARY OF STATE TILLERSON SAYS U.S. DOES NOT BLAME CHINA FOR SITUATION IN NORTH KOREA, BUT WANTS IT TO USE ECONOMIC INFLUENCE ON PYONGYANG
  • TILLERSON SAYS U.S. DOES NOT SEEK REGIME CHANGE IN NORTH KOREA, “WE ARE NOT YOUR ENEMY”
  • TILLERSON SAYS WOULD LIKE TO HAVE A DIALOGUE WITH NORTH KOREA AT SOME POINT
  • TILLERSON SAYS U.S. AT PIVOT POINT IN RELATIONSHIP WITH CHINA, LOOKING AT HOW TO DEFINE RELATIONSHIP IN FUTURE

Previous Minuteman ICBM launches this year were conducted in February, April and May. That month, the Air Force also conducted a test of a missile interceptor launched from Vandenberg which destroyed a mock warhead over the Pacific.

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6 Key Questions About RussiaGate

Authored by Charles Hugh Smith via OfTwoMinds blog,

Guilt by association is insidious because it can't be cleared in court.

The claims that Russia meddled in the 2016 U.S. election are now known as RussiaGate, in a loose reference to the Watergate scandal of the early 1970s.

In the U.S., the issue has been poisoned by profound partisanship: those who feel disenfranchised by the election of Donald Trump are trying to use RussiaGate to unseat or cripple the Trump presidency, while those who elected Trump feel RussiaGate is nothing but an attempt by the corrupt status quo to disenfranchise them.

Let's see if we can clarify the issues with some key questions.

1. Did Russia meddle in the 2016 U.S. election? This is the entire thing in a nutshell. But this raises a second question: did Russia successfully meddle in the 2016 U.S. election? In other words, we have two investigations: one to identify verifiable, legally actionable evidence of meddling, and a second investigation into the effects of any meddling–should evidence arise that would stand up in court.

2. What federal laws or statutes were broken? This is a serious charge, and the first step in any investigation is to nail down precisely what federal laws were broken? The next step is to assemble evidence for the criminal activity that will stand up in court.

3. What standard of evidence/proof is required in a federal court to convict the accused? Is intent a necessary component of the laws that were broken? What precisely constitutes burden of proof? It isn't enough to accuse persons unknown of wrong-doing: the precise laws that were broken must be identified and the case against specific individuals must be built on verifiable evidence that will stand up in federal court.

Recall that this is not about partisan talking points–it's about justice. Those who reckon justice counts for nothing in this investigation disqualify themselves. If justice no longer matters in America, there is no America left to defend.

4. If incontrovertible evidence of Russian meddling arose in 2016, why did the federal agencies under the Obama administration (Department of Justice, F.B.I., etc.) do nothing? While we can cook up various theories, the common-sense conclusion is 1. no federal laws were broken and/or 2) there was insufficient evidence that would stand up in court.

5. Precisely what meddling occurred? Somebody meeting with a Russian does not constitute proof of anything. rather, this is the classic witch-hunt accusation of the McCarthyite "Red Scare" of the 1950s–guilt by association: you were seen conversing with a Communist, thus you must also be a Communist–or at a minimum, you are tainted by association and thus under a cloud of suspicion that can never be cleared because no accusation of guilt in a court of law is ever made.

Guilt by association is insidious because it can't be cleared in court. Those accused of guilt by association are not innocent until proven guilty–they are guilty until proven innocent, a proof that can never satisfy the accusers.

A precisely defined chain of verifiable actions is required to prove meddling beyond reasonable doubt. So date, all the accusations have failed to meet this most fundamental standard of evidence of wrong-doing.

As for the claim that "all 17 U.S. intelligence agencies concur that blah-blah blah"– Where precisely is the evidence? If there is no verifiable evidence and no chain of events that can be substantiated with hard evidence that will stand up in federal court, then all we really have is accusations of guilt by association, i.e. a witch-hunt.

6. What evidence supports the claim that Russian meddling actually influenced the election? The claim that Russians hacked the Democratic National Committee emails has fallen apart for lack of evidence; it now seems clear that the hack was an inside-the-DNC whistleblowing incident.

As for the claim that Russian meddling negatively impacted the campaign of Hillary Clinton: the most damaging bits were all verifiably accurate in the public record:

— The Podesta emails were in fact Podesta emails.

— The video of candidate Clinton apparently collapsing on the curb was not fabricated; it was a video recorded by an amateur bystander.

— Reports of pay-to-play and other unsavory activities within the Clinton Foundation predate the election by years.

— Candidate Clinton's comments on "deplorables" were her own words.

Again, standards of evidence and proof of guilt of federal crimes require a precise chain of events and actions for which there is evidence that will stand up in federal court, , i.e. evidence that will persuade a jury or federal judge and that can withstand cross-examination and the inquiries of experts hired by the defense.

Given the absolute paucity of actionable, verifiable evidence to date, RussiaGate is so far nothing but a series of unsupported accusations of guilt by association, i.e. a witch-hunt. This is why some in the mainstream media have characterized the whole thing as a "nothing-burger."

Compare RussiaGate to Watergate. Watergate was always about compiling evidence of activities that violated federal laws. People who broke federal laws were identified, evidence was compiled and presented in a court of law where the accused were able to defend themselves against an indictment presented by federal prosecutors. Some were acquitted, many were convicted, others plea-bargained a conviction with a reduced sentence.

Those making accusations in RussiaGate must now put up or shut up: either present the evidence that supports federal indictments, or confess to the pursuit of a witch hunt, i.e. unsubstantiated accusations of guilt by association. Anything less than the presentation of actionable evidence that leads to indictments and convictions is not justice–it's just another witch-hunt that besmirches everyone who participates in the witch-hunt.

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General Kelly In 2014: Human Trafficking And Drug Cartels ‘Most Concerning’ Threat Facing U.S.

Content originally published at iBankCoin.com

Was recently installed White House Chief of Staff John Kelly’s stance on human trafficking and drug cartels a factor in President Trump’s decision to promote the man originally picked to head up Homeland Security?

In a revealing 2014 interview, the retired 4-star US Marine Corps general told PRISM magazine that the ‘most concerning’ threat facing the United States comes from international criminal networks trafficking in drugs and sex workers:

These are international criminal networks – everything gets in. Hundreds and hundreds of tons of illicit narcotics. Relatively small amounts are taken out of the flow by our border controls. Tens of thousands of sex workers, in many cases adolescents, come into the United States every year through these networks to serve the sex industry. I spoke at a human rights conference at the University of South Florida, in Tampa. The audience was shocked when I talked about sex workers. –Gen John Kelly

Speaking Trump’s language

Upon taking office, President Trump made the fight against human trafficking and pedophilia a top priority for his administration – kicked off by a human trafficking awareness ad released in early February by the Department of Homeland Security (headed by… General Kelly, 67).

That was only the beginning. Five days later on February 9, Trump signed an Executive Order to combat human trafficking (“Presidential Executive Order on Enforcing Federal Law with Respect to Transnational Criminal Organizations and Preventing International Trafficking”).

Then in late February, Trump told a room of advisors and representatives from anti-trafficking organizations that he vowed to fight the ‘epidemic’ of human trafficking, promising to bring the ‘full force and weight‘ of the U.S. government to address the problem. Of note, a record 1500+ arrests of pedophiles or sex traffickers were made during Trump’s first month in office.

And in a June speech at a launch ceremony for the State Department’s 2017 Trafficking in Persons Report, Ivanka Trump said that ending human trafficking is in our ‘moral and strategic interests,’ and a top White House priority.

“Ending human trafficking is a major foreign policy priority of the Trump administration,” -Ivanka Trump

Finally, last Friday, President Trump told a group of law enforcement officials on New York that human trafficking is possibly worse ‘than it’s ever been in the history of the world.’

You go back 1,000 years, where you think of human trafficking, you go back 500 years, 200 years, 100 years, human trafficking, they say — think of it, what they do — human trafficking is worse now, maybe, than it’s ever been in the history of this world. -Donald Trump

Map of human trafficking, polarisproject.org

In 2004, the State Department estimated between 600,000 and 800,000 people are trafficked across an international border each year – of which 70 percent are thought to be female, and 50 percent minors. According to the Daily Caller: The Polaris Project, a human trafficking-focused NGO, estimates that the issue of human trafficking in the U.S. is getting worse. From 2015 to 2016, reported human trafficking cases jumped by 35 percent; reports of labor trafficking, in particular, jumped by 47 percent from 2015 to 2016.

MS-13

Trump’s February Executive Order was aimed at international cartels dealing in both drugs and human trafficking – and MS-13 has been singled out as a primary threat.

These groups are drivers of crime, corruption, violence, and misery. In particular, the trafficking by cartels of controlled substances has triggered a resurgence in deadly drug abuse and a corresponding rise in violent crime related to drugs. Likewise, the trafficking and smuggling of human beings by transnational criminal groups risks creating a humanitarian crisis.

In addition to AG Jeff Sessions targeting MS-13 last month, Trump vowed to ‘destroy the vile criminal cartel’ during last Friday’s speech to law enforcement professionals. “[MS-13 has] transformed peaceful parks and beautiful quiet neighborhoods into blood-stained killing fields,” Trump said. “They’re animals. We cannot tolerate as a society the spilling of innocent, young, wonderful vibrant people”

For a brief look into the gang, Tucker Carlson recently traveled to El Salvador for his week-long series “Hunting MS-13,” which includes an interview with a cartel assassin:

 

To that end, Gen. Kelly also shared his thoughts on cartels in 2014 with PRISM magazine:

These are international criminal networks – everything gets in. Hundreds and hundreds of tons of illicit narcotics. Relatively small amounts are taken out of the flow by our border controls.

“Could someone come in with a weapon of mass destruction, biological weapon travel on this network?” Of course! Last year [2013], this network carried 68,000 children into the United States. We are dealing with a very efficient network, which worries me.

Can you see why Trump chose Kelly from the beginning? 

John Kelly is a plain spoken pragmatist who lost his son in President Bush’s ill fated desert wars. He understands crime – both within the United States, and the external elements which fuel the problem. He speaks of democracy and sovereign rights. When asked by PRISM magazine in 2014 about anti-American sentiment brewing in South America, Kelly responded “if they are all functioning democracies – as we understand it with a functioning free press, with functioning human rights protections, with militaries sub-ordinate to civilian control – they have every right to go in any direction they want and choose their alliances.”

In other words, Kelly’s core values are in alignment with the constitution and the ‘law and order’ presidency Trump promised when he was elected. He’s also a disciplinarian, a seasoned voice of reason, and perhaps most importantly – a key member of the shrinking circle of advisors the President can trust.

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US Construction Spending Just Collapsed

Headline growth in US construction spending collapsed in July to just 1.6% YoY – the weakest since 2011.

As Reuters reports, U.S. construction spending unexpectedly fell in June as investment in public projects recorded its biggest drop since March 2002. The Commerce Department said on Tuesday that construction spending tumbled 1.3 percent to $1.21 trillion – the lowest level since September 2016 – drastically missing economists' estimates of a 0.4% increase.

This downside surprise suggests notable downside revisions to Q2 GDP (from its 2.6% annualized level).

However, most ironic in the government's report was, amid The White House constant chatter of the need for infrastructure spending in America, Federal government construction spending crashed 9.5% – the largest drop since December 2010.

Public construction spending has hovered in negative territory for the most part of the past year and requires a strong infrastructure spending for its revival. The latest data suggest state and local investment was weaker-than-previously estimated and imply a further modest downward revision to 2Q GDP.

In June, investment in public construction projects plunged 5.4 percent, the biggest drop since March 2002. The decline pushed public construction spending to its lowest level since February 2014. Outlays on state and local government construction projects fell 5.1 percent in June, also the largest fall since March 2002.

As Bloomberg Intelligence notes, the trends in the underlying components of construction spending of late are disconcerting, though the private sector slowdown could prove temporary as housing supply needs to increase. The public sector’s bleak performance is unlikely to see a significant change without a significant fiscal boost in the form of a well-thought-out infrastructure spending program.

Looking at taxpayer-funded spending on America’s highways, schools and water systems, the White House’s infrastructure plan appears long overdue. Government projects’ share of total construction outlays was less than 22 percent in June, the smallest since 2006.

Does this look 'transitory' to you?

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Los Angeles Just “Won” the 2028 Summer Olympics. That Is SUCH Bad News.

So Los Angeles will be hosting the Summer Olympics for a third time, in 2028 (the city previously hosted Olympics in 1932 and 1984). The city had originally tried to win hosting rights for the 2024 Games, which went to Paris instead. The International Olympic Committee (IOC), which has had trouble finding cities willing and able to host its quadrennial summer boondoggles, went ahead and gave LA the nod 11 years from now.

My advice for residents in the city I once called home and where Reason Foundation, the nonprofit that publishes this website, is to start packing your bags.

Really, just GTFO. 2028 may seem like a long time away, but it will sneak up on you and the last place anyone wants to be is in a city that has pledged billions—over $5 billion, in LA’s case—to stage a boondoggle that will almost certainly suck all sorts of tax dollars and private resources out of the real economy and flush them down a unisex toilet in the basement of the Edifice Complex.

As Garrett Quinn explained for Reason in 2015, it’s virtually impossible for a city to break even when hosting a Summer Games. The expected revenue is around $6 billion and the gate is split between the host city and the IOC (which takes a whopping 70 percent of the TV revenues alone!).

So before the first athlete gets bounced for failing a drug test, LA is already $2 billion in the red, assuming the bidders’ cost estimate is correct, which it almost certainly isn’t. The Beijing Games cost $40 billion and the London version cost $20 billion. Russia ponied up $50 billion for the poorly provisioned Sochi Games and Brazil has consistently lied about how much its Rio Games cost (officials say $13 billion while outside analysts put it closer to $20 billion). Montreal hosted the Games back in 1976, arguably at the peak of Cold War interest in the Olympics, and spent 30 years paying off its debt. But at least Bruce Jenner defeated communism (in the figure of Nikolai Avilov) in the decathlon back then. Americans will doubtless be more interested in the Games when they are held in LA than they are elsewhere, but history is rapidly leaving the Olympics behind for all sorts of reasons, including all the awful mascots.

Despite lip service to using existing venues and getting corporate donors, don’t expect the city fathers of LA, which has a massive inferiority complex that often drives it to go bigger than necessary, to tighten their belts on this shining moment. Especially since they will no doubt be arguing that new kayak runs and velodromes will become cash-flow-positive venues for decades after the Olympic torch has left the area to burn a hole in the budget of some other sad-sack city. Take a tour of the venues of the 2004 Athens Games, why don’t you? They were the most expensive iteration up until that point in time but the facilities literally started falling apart after the final race had been run.

It’s true that by most accounts, LA’s 1984 Games didn’t swamp the city in debt. In fact, there’s reason to believe LA made a profit hosting the event. But that was decades ago and so far no other host city has come close to achieving that feat. “The best way for a city to win on the Olympics is to decline to bid,” wrote Reason’s Ed Krayewski in July, when it became clear that Paris and LA had finished first and second in bids for the 2024 Games (surprise: they were the only two cities to bid!). That sounds about right, and it’s true of the economics of most stadiums for football, baseball, and hockey/basketball too. The Olympics, like hosting an NFL franchise and gifting them a stadium built with tax dollars, is a luxury good, an act of conspicuous consumption that is morally offensive in an age of unfunded pension liabilities, rotten school outcomes, and crumbling roads and bridges.

Watch “Sports Stadiums Are Bad Public Investments. So Why Are Cities Still Paying for Them?”

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Kamala Harris is Being Aggressively Manufactured for 2020 by Wealthy Clinton Donors

Kamala Harris’ coming out party as the person chosen to be manufactured as a puppet for the rich and powerful going into 2020 became obvious last month with the publication of an article in The New York Post titled, Dems’ Rising Star Meets With Clinton Inner Circle in Hamptons. Here are a few excerpts:

The Democrats’ “Great Freshman Hope,” Sen. Kamala Harris, is heading to the Hamptons to meet with Hillary Clinton’s biggest backers.

The California senator is being fêted in Bridgehampton on Saturday at the home of MWWPR guru Michael Kempner, a staunch Clinton supporter who was one of her national-finance co-chairs and a led fund-raiser for her 2008 bid for the presidency. He was also listed as one of the top “bundlers” for Barack Obama’s 2012 re-election campaign, having raised $3 million.

Guests there to greet Harris are expected to include Margo Alexander, a member of Clinton’s inner circle; Dennis Mehiel, a Democratic donor who is the chairman of the Battery Park City Authority, even though he lives between a sprawling Westchester estate and an Upper East Side pad; designer Steven Gambrel and Democratic National Committee member Robert Zimmerman.

Washington lobbyist Liz Robbins is also hosting a separate Hamptons lunch for Harris.

continue reading

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By Propping Up Obamacare With Illegal Payments, Trump Is Eroding the Rule of Law

For a prime example of how the poorly conceived policy of Obamacare interacts with the Trump administration’s disregard for the rule of law, look no further than the debate over the health law’s subsidy payments to health insurance companies.

Over the last several months, as Republicans have struggled with legislation to repeal and replace Obamacare, President Trump has repeatedly warned that the health care law is already failing. If Congress did nothing, he said last week, he would let it “implode.” That may sound passive, but coming from Trump, it was an active threat to hasten the law’s demise.

Since taking office, the president has dangled the possibility that his administration might cut off payments being made to insurers as part of Obamacare—money that insurers say is vital to stabilizing the health law’s insurance exchanges. Over the weekend, he raised the idea again, tweeting that, should Congress fail to act, bailouts for insurance companies “will end very soon.”

The threat is meant to be leverage to force a recalcitrant Congress to act. In fact, it’s a reckless move, because the payments are illegal and never should have been made in the first place.

As surface politics, Trump’s threat is poorly chosen—cutting off the payments would cause premiums to rise. As policy and precedent, it’s even worse—these payments are unconstitutional, and Trump’s threats suggest he believes he has the legal authority to choose whether or not to make them.

The debate over these subsidies offers a window into how the failings of Obamacare, the weaknesses of Congress, and the Trump administration’s policy bluster are interacting to the detriment of the rule of law. But to understand the larger implications, it helps to know a little bit about the interlocking subsidies and side payments called for under the health care law.

The payments in question are known as cost-sharing reduction (CSR) subsidies. Health insurers operating under the law are required to reduce deductibles and copayments for individuals who make less than 250 percent of the poverty line, a group that encompasses a little more than half of enrollees. The federal government then pays insurers directly in order to cover the cost of further subsidizing this population.

These subsidies come in addition to the insurance subsidies that Obamacare offers to people earning up to 400 percent of the poverty line. Essentially, it’s an additional layer of financial assistance designed to reduce the out-of-pocket cost burden that even Obamacare’s already subsidized insurance places on the near poor.

The CSR payments provide a considerable boost to health insurers’ bottom line: about $7 billion last year, and an expected $10 billion this year. By 2026, the payments are expected to total about $130 billion.

Unsurprisingly, health insurers are keen to keep them going. Their argument for continuing the payments is fairly straightforward: They are part of the statute of the Affordable Care Act. Under the law, insurers would be required to offset the out of pocket costs for lower-income people regardless of whether the CSR subsidies are paid. So insurers would almost certainly sue to regain the payments if Trump cut them off. If the payments are not made, insurers say they will raise premiums in order to compensate.

The important complication is that even though the payments are written into the law, money to pay them was never appropriated by Congress. Under the Constitution, Congress must appropriate money in order for the executive branch to spend it.

The Obama administration explicitly asked for a Congressional appropriation of money for the CSR payments, but Congress never provided it. The administration then made the payments anyway, and the Trump administration has so far continued the practice.

Under the Constitution, however, only Congress has the power to appropriate funds. In 2014, House Republicans sued the Obama administration for exceeding its constitutional authority by spending money on the payments without authorization and thereby usurping the congressional power of the purse. The Obama administration argued that it was required to follow the text of Obamacare.

In May of last year, a federal judge agreed with House Republicans. U.S. District Judge Rosemary Collyer ruled that the Obama administration had unambiguously overstepped its authority in making the payments without an explicit fiscal go-ahead from the legislative branch. “Congress authorized reduced cost sharing but did not appropriate monies for it, in the [fiscal year] 2014 budget or since,” she wrote in her decision. “Congress is the only source for such an appropriation, and no public money can be spent without one.” However, Collyer also stayed her decision in order to give the Obama administration time to appeal.

The lawsuit would have continued under a Hillary Clinton administration. But Donald Trump’s win in November threw its status into uncertainty. Since the election, both the Trump administration and House Republicans have asked for and been granted delays. They now suggest they would like to resolve the matter out of court.

Many insurers are already losing money in the exchanges and are skittish about the future of Obamacare. The lack of certainty about whether CSR payments will continue to be made has caused them to hedge their bets by raising premiums. This is politically unpopular, and as a result, both Republican and Democratic members of Congress have indicated that they want to see the CSR subsidies paid in order to stabilize the jittery Obamacare exchanges. Trump, of course, has refused to commit one way or another, saying explicitly on several occasions that he hopes the threat of cutting off the payments will bring Democrats to the negotiating table, or push Republicans in Congress to act.

The result is a cascade of linked policy and political failures, in which partisan convenience has trumped both good sense and constitutional duty at nearly every turn.

The original health care law, which was passed over the unanimous objections of the opposing political party, was designed to work only if future lawmakers acted from a position of total political support by authorizing money to make the CSR payments. The Obama administration then chose to implement the law in a way that defied Congress and exceeded its constitutional authority.

Many Republicans in Congress now apparently want to keep making the CSR payments in order to not undermine the exchanges. Even Mitch McConnell has said that, in the absence of a repeal bill, the markets must be stabilized. But GOP lawmakers, despite cautioning Trump against cutting off the payments, have not appropriated money for them via independent legislation (although some are now suggesting that this may be on the table).

Meanwhile, the Trump administration has acted in a way that simultaneously increases policy uncertainty while undermining the rule of law. As recently as last week, Health and Human Services Secretary Tom Price, who supported the House lawsuit against the subsidies when he was in Congress, refused to say whether the payments ought to be continued.

This should not be a drawn-out decision, left open for months at a time. Nor should it be treated as a blunt cudgel for gaining political leverage. If Trump and his team truly believe that the CSR payments are unconstitutional, they should have stopped making them immediately.

Instead, the president has continued to make the payments while openly musing about the possibility of cutting them off in hopes of improving his political bargaining position. In doing so, he has not only caused chaos and instability in the marketplaces. He has effectively taken the position that this is all a matter of executive discretion. It is not. Either the CSR subsidies are statutorily required and clearly appropriated by Congress, or they are not. Judge Collyer’s decision on this question was clear: The payments have not been authorized. They should never have been paid.

By refusing to commit, and by treating the payments as optional, Trump is arguably expanding on the errors of his White House predecessor, which at least maintained that it had a legal obligation, based on statute, to make the payments, with or without explicit congressional appropriation.

Trump’s decision to hold the CSR subsidies hostage for political gain sets a dangerous precedent that will surely be followed by those who succeed him. What is ultimately at stake here is not only the future of the health care law, but of the constitutional separation of powers and the limits of executive branch authority. Trump’s ham-fisted attempt at dealmaking is eroding those limits, and in the long run we are all worse off for it.

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“I’m Going To Redefine Terror”: Bay Area Resident Accused Of Aiding ISIS, Planned To Murder 10,000 People

Authored by Mac Slavo via SHTFplan.com,

As ISIS has shown in their own magazine, they’ll probably never try to pull off a massive terror attack on American soil. Instead, they’ll indoctrinate useful idiots who already live here, and convince them to engage in numerous small attacks, similar to the bombings, knifings, and shootings that have plagued Europe in recent years. It’s a strategy that is far less likely to be foiled, costs significantly less, and can be maintained long after ISIS is overrun in the Middle East.

And what also makes this strategy so enticing is that these small attacks, which are so much more difficult to prevent, is that they can add up over time. They have the potential to accumulate death tolls that dwarf previous terror attacks, and there is little doubt that groups like ISIS are working to make that happen right now.

For instance, a 22-year-old man named Amer Sinan Alhaggagi from Oakland, California was indicted on terror related charges last week, after he allegedly “attempted to provide services and personnel to the Islamic State of Iraq and al-Sham (ISIS).”

However, that justice department statement is a very sanitized version of what he’s actually being accused of. His plans, which were unearthed by undercover agents working for the FBI, suggest that he intended to kill as many as 10,000 people in the Bay Area with a wide variety of attacks; which included bombings, mass poisonings, and arson.

In that December 2016 court hearing, prosecutors revealed Alhaggagi talked about plans to sell cocaine laced with rat poison in Bay Area nightclubs. The undercover agent says he was looking for information on the exact mixture of strychnine and cocaine to use in that scheme. He showed the agent an ISIS bomb-making manual he downloaded on a computer and he sent the agent photographs of guns he said he obtained.

 

“He then told confidential source number one, ‘I live close to San Francisco, that’s like the gay capital of the world. I’m going to handle them right, LOL,’ meaning laughing out loud. ‘I’m going to place a bomb in a gay club, Wallah or by God, I’m going to tear up the city.’ And I quote, ‘The whole Bay Area is going to be up in flames,'” the federal prosecutor explained to Judge Westmore in his argument to have Alhaggagi detained.

 

He also told the court how Alhaggagi took the undercover agent, posing as an ISIS supporter from Salt Lake City, on a tour of the Bay Area including the Cal Berkeley campus. The feds say he wanted to plant backpack bombs at the dorms and went along with the undercover agent to set up a storage unit where he would store supplies for his plans.

Alhaggagi even attempted to get a job with the Oakland Police Department, with the goal of using that position to attain weapons that he couldn’t make himself.

He told the court, “If he was unable to make bombs himself, then his intent was to get employed by a police department and steal weapons from the police department once employed there and in that context, he said and I quote, ‘I’m going to redefine terror.'”

 

Oakland police were tipped off by the feds and there was never any chance Alhaggagi would get a job at the department.

This is the new reality of terrorism. It’s no longer just about foreigners sneaking into our country to carry out sophisticated plans. It’s about ordinary individuals who already live here, and are more than capable of blending into our society. They don’t have to pull off 9/11 style attacks. They can simply murder lots of people in very ordinary ways.

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