Is DeSantis a Principled Governor or a Retaliatory Culture Warrior?


Governor DeSantis speaking to a crowd on clear day

In this week’s Reason Roundtable, editors Matt Welch, Peter Suderman, Katherine Mangu-Ward, and Nick Gillespie scrutinize Florida Gov. Ron DeSantis’ style of conservatism and touch on President Joe Biden’s upcoming visit with the House of Saud.

1:28: DeSantis and his approach to governance

30:36: Weekly Listener Question: You guys occasionally talk about the Libertarian Party, and you might be aware of the recent convention which saw power go to one faction that many describe as quite alienating. This has led to many of the traditional libertarians leaving the party altogether. My question for you all is do you think that the Libertarian Party is necessary for facilitating more libertarian representation in politics? If not, how do you see libertarian ideals grow in the traditional duopoly?

38:39: Biden’s forthcoming visit to Saudi Arabia

52:30: Media recommendations for the week

This week’s links: 

The Death of Walt Disney’s Private Dream City? by Zach Weissmueller and Danielle Thompson

Anti-LGBT Panics Are Bad for Everyone’s Liberty,” by Scott Shackford

Blame Biden for High Gas Prices,” by Nick Gillespie and Regan Taylor

Saudi Prince’s Plan for ‘Walkable’ City of Single-File Buildings Could Be Two Miles-Long Skyscrapers Instead,” by Christian Britschgi

Alex Epstein: Why the Future Needs More Fossil Fuels,” by Nick Gillespie 

Send your questions to roundtable@reason.com. Be sure to include your social media handle and the correct pronunciation of your name.

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  • Reason Speakeasy: Nick Gillespie and Brian Doherty talk ‘Dirty Pictures’

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Music: “Angeline,” by The Brothers Steve     

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Blue State Exodus: Many Consider Leaving One of The Biggest Democratic States

Blue State Exodus: Many Consider Leaving One of The Biggest Democratic States

By Beth Brelje of The Epoch Times

A Pennsylvania-based think tank that works with lawmakers to enact state policies has released results of a statewide poll that it says shows policymakers “a new pathway to prosperity” through the support of the foundation’s 23-point reform agenda.

The right-leaning Commonwealth Foundation released its May poll results on Thursday.

The unelected but powerful, policy-pushing foundation said its poll shows most Pennsylvania voters in all parties are united in their dissatisfaction with the direction the state is going—some to the point of wanting to move away.

The poll shows 68 percent say things in Pennsylvania have “pretty seriously gotten off on the wrong track” and 42 percent said they had considered moving to another state or personally knew someone who had already moved or thought about moving.

“Families are leaving for better jobs, educational opportunities, and quality of life in other states,” the Commonwealth Foundation said in a statement about the poll.

Asked if Pennsylvania is better, worse or the same for businesses than it was 10-years ago, 53 percent said worse, 33 percent said about the same and 14 percent said better.

The majority, 45 percent, graded Pennsylvania’s K-12 school system at a “C” level. Just 5 percent gave it an “A” but 8 percent graded it an “F.”

Of those polled, 41 percent were Republican, 45 percent Democrat, 14 percent independent, and 48 percent were men while 52 percent were women.

Across parties, the top category of concern voters picked was “Rising prices and inflation,” followed by “The economy and jobs,” and third, “Taxing and spending.” Very few participants picked COVID-19, education, or public safety as a top concern to consider in the November general election.

The majority of those polled agreed the following goals are important:

  • Ensuring all K-12 students have access to an excellent education.

  • Reducing government spending and regulatory red tape.

  • Reforming welfare and protecting the dignity of work.

  • Increasing the number of Pennsylvanians in the workforce.

  • Restoring public sector workers’ rights.

  • Making health care more accessible and affordable.

  • Making government more accountable and transparent.

In response to the poll, the Commonwealth Foundation is urging lawmakers to support its 23-point reform agenda, called Better Pennsylvania in 2023.

“If lawmakers or those running for office want to make life better for Pennsylvanians, they’ll adopt these polices and ensure everyone has an opportunity to flourish,” Jennifer Stefano, Commonwealth Foundation executive vice president said in a statement. Many of the proposed policies are items the foundation has advocated for in the past.

Here is a look at the agenda by category, including the percentage of people polled who supported the policy.

Education

  • Expanding tax credit scholarships, which allow businesses to donate money to nonprofit organizations that provide scholarships to low-income and middle-income children in Pennsylvania to attend pre-kindergarten or K-12 private school (85 percent support).

  • Creating education opportunity accounts, a government-funded account that parents can use for restricted educational expenses, including tuition, tutoring, online education programs, and therapies for students with special needs (84 percent support).

  • Establishing an independent authorizer for charter schools, such as a state board or universities, which would approve and renew charter schools; rather than the current system in which only school districts can approve charter schools (80 percent support).

  • Creating an A-F grading system that would give every one of Pennsylvania’s K through 12 schools a grade based on factors including state achievement, learning gains in assessment scores, and graduation rates (82 percent support).

Pennsylvania Economy

  • Passing a state constitutional amendment that would limit increases in government spending to the rate of inflation plus the rate of population growth. The limit could be exceeded with agreement from two-thirds of both houses of the General Assembly (82 percent support).

  • Lowering Pennsylvania’s tax rate for all businesses by eliminating $1 billion in state government-funded subsidies to select companies (80 percent support).

  • Requiring a vote by the state legislature to approve any new state regulation that would cost more than $1 million (77 percent support).

  • Withdrawing Pennsylvania from the multi-state Regional Greenhouse Gas Initiative (RGGI) because Governor Wolf entered into the agreement without legislative approval, and because it imposes additional taxes on electricity production (62 percent support).

Workforce

  • Requiring healthy adults (excluding seniors, individuals with disabilities, and those with young children) who receive welfare benefits to work, seek work or job training, or volunteer in their communities to continue receiving benefits (82 percent support).

  • Ensuring that individuals are eligible for welfare by verifying income, residency, and household composition twice a year (88 percent support).

  • Granting Pennsylvania businesses and individuals tax credits for donations to approved charitable organizations that provide basic needs such as childcare, medical care, food, clothing, shelter, and job placement (87 percent support).

  • Allowing certified nurse practitioners in Pennsylvania to work without the supervision of a doctor to increase access to health care (71 percent support).

  • Tying the length of time an individual can receive unemployment benefits to economic conditions. For example, shorter benefit periods when the unemployment rate is low; and longer benefit periods during a recession. This would encourage work and help shore up Pennsylvania’s depleted unemployment trust fund (78 percent support).

Accountable And Transparent Government

  • Enrolling all newly hired government employees into a 401(k)-style retirement plan, similar to what most employees in the private sector receive, instead of a guaranteed pension for life, to create predictable and affordable retirement benefits (83 percent support).

  • Removing government control of the sale and distribution of wine and liquor by selling all state-run liquor stores, and allowing private retail stores and wholesalers to sell alcohol (78 percent support).

  • Modernizing Pennsylvania election laws to include voter identification; clear voting deadlines; and limits on private, third-party funding of elections (86 percent support).

Safer Communities

  • Reforming Pennsylvania’s juvenile justice system to encourage alternatives to institutionalization, such as community-based rehabilitation programs for first-time and low-risk offenders (89 percent support).

  • Reducing outdated Pennsylvania licensing restrictions that prevent anyone with a criminal conviction who has paid their debt to society from getting a job (91 percent support).

Public Sector Unions

  • Stopping the use of taxpayer-funded public payroll systems to collect campaign contributions and other funds that government union leaders use for political purposes (87 percent support).

  • Requiring state and local governments to post labor contracts before voting on them, to give taxpayers transparency on the cost of government union contracts (90 percent support).

  • Requiring regular elections for government employees to vote on their union representation, something that has not happened for more than 30 years (88 percent support).

  • Requiring state and local governments notify all employees of their legal rights to join or not join a union (93 percent support).

  • Allowing government union members the right to end their union membership at any time (89 percent support).

Tyler Durden
Mon, 06/06/2022 – 17:00

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Over 45,000 Americans Have Applied To Sponsor Displaced Ukrainians


Ukrainian woman on a bus as she flees her home

In late April, the Department of Homeland Security (DHS) announced the launch of a new private sponsorship program through which American citizens could support Ukrainians displaced by the Russian invasion. According to DHS data shared with CBS News last week, over 45,000 Americans have applied to help resettle Ukrainians in the United States since the Uniting for Ukraine program began.

United Nations data indicate that more than 14 million Ukrainians have left their homes since Russia invaded Ukraine in late February. Nearly 7 million of them fled to neighboring countries. Though millions of displaced people have already returned to safer regions in Ukraine, much of the nation remains under siege—and many Ukrainians are seeking family reunification and more stable homes elsewhere in the world.

Roughly 6,500 Ukrainians had arrived in the U.S. through the sponsorship program as of June 1, while another 27,000 have been authorized to travel here to join their American sponsors. Those coming here aren’t refugees in the technical sense of the word. Rather, they’re parolees, which means they can only live and work in the country for two years. The relief is designed to be temporary, which will deprive many Ukrainians of a lasting haven. But the program is nonetheless an important component of the global response to the exodus in Eastern Europe.

It arose at least partially in response to deep deficiencies in the U.S. immigration system. The American refugee resettlement program slowed severely thanks to the Trump administration and pandemic-era restrictions on cross-border movement. Just 11,411 refugees were resettled in the U.S. in FY 2021, short of an annual cap of 62,500. Other visa pathways have severe application backlogs, meaning that few existing immigration options were well-suited to handle the massive flight of Ukrainians. The fact that 22,000 Ukrainians were admitted after crossing the southern border only solidifies the necessity of laying out a predictable, direct pathway.

This private sponsorship initiative cuts the refugee program and its agency-based resettlement process out of the mix entirely. Instead, private citizens must connect with displaced Ukrainians (via Facebook, for example) and agree to financially support them before they may come to the United States. This ensures that Ukrainians arrive with a built-in safety net. The program’s breadth is directly linked to citizen-level generosity and welcome—important factors for sustainable refugee resettlement. The resettlement structure also helps funnel Ukrainians into the communities best-equipped to receive them. About 15 percent of American sponsors live in the New York metro area, and all other top sponsorship regions are major cities—many of them with large Ukrainian populations.

Uniting for Ukraine isn’t a perfect answer for every displaced Ukrainian, but it allows private citizens to get involved in immigration relief in a novel way. A far-off emergency scenario can leave many benevolent people wishing they had a practical way to help. This program is a meaningful start. The fact that 45,000 people have already volunteered to participate bodes well for the future of private sponsorship.

The post Over 45,000 Americans Have Applied To Sponsor Displaced Ukrainians appeared first on Reason.com.

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SEC Preparing Historic Overhaul Of Market Structure, Making Retail Frontrunning Virtually Impossible

SEC Preparing Historic Overhaul Of Market Structure, Making Retail Frontrunning Virtually Impossible

In one of those “we’ll believe it when we see it” updates, moments ago the WSJ reported that the SEC – having been lambasted for years for doing nothing to contain the criminal casino also known as the stock market – is preparing to propose unprecedented changes to market structure as soon as this fall which would make it virtually impossible to frontrun retail orders.

According to the WSJ, SEC Chair Gary Gensler directed staff last year to explore ways to make the stock market “more efficient for small investors and public companies.” And while aspects of the effort are in varying stages of development, one idea that has gained traction is to require brokerages to send most individual investors’ orders to be routed into auctions where trading firms compete to execute them, effectively making frontrunning impossible and obsoleting the entire microwave/laser trading industry which is meant to do just one thing: trade ahead of slower (retail) orderflow.

Digging into the details, we find that the most consequential change being discussed would impact the way trades are handled after an investor places a so-called market order (i.e., adding liquidity) with a broker to buy or sell a stock. Market orders, which account for the majority of individual investors’ trades, don’t specify a minimum or maximum price the investor is willing to pay, and are ripe for frontrunning by countless subpennying algos which move the entire market away from the order and force it to chase the market higher or lower, creating massive “slippage” in the process, or profits for HFTs and internalizers, such as Citadel, which can then turn around and immediately take the other side of the trade locking in risk-free profits.

Gensler has said he wants to ensure that brokers execute orders at the best possible price for investors—the highest price for when an investor is selling, or the lowest price if they are buying.

Under current rules, brokers have to perform “reasonable diligence” to determine the likely best market for executing a trade. Many brokers route orders to big electronic trading firms called wholesalers, including Citadel Securities or Virtu Financial, which of course have been accused for over a decade that their entire business model is frontrunning retail orders, rather than to exchanges such as IEX and the Nasdaq, arguing that the wholesalers provide the best prices (spoiler alert: they don’t, but that’s the lie they spread for popular consumption, and instead by collecting tens of millions of risk free pennies every day, the profits such “internalization” creates allows Ken Griffin to buy a new massive mansion every quarter).

Of course, as regular readers know well, some brokers, such as Robinhood Markets, have converted their entire business model to essentially be middlemen for the Virtus and Citadels of the world, and while offering “zero cost” trades, they accept compensation from wholesalers for routing trades to their venues. And since said orderflow allows the internalizers to trade ahead of billions in dollars, effectively guaranteeing risk-free trades, the internalizers end up making orders of magnitude more than they pay to say Robinhood for the exclusive right to see all orderflow first.

Gensler has said this practice, known as payment for order flow, creates a conflict of interest and limits competition for individual orders.

Under the auctions being considered by the SEC, different firms would compete with each other to fill an individual investor’s trade.

Such a mechanism would fundamentally alter the business model of wholesalers, which can make more money by trading against small investors than they do on public exchanges, where they may find themselves trading with other sophisticated trading firms or institutional investors.

Translation: if PFOF is banned and if retail market orders enter an auction system, Robinhood is worth exactly $0, while those “feeder” firms which rely on Robinhood access to retail order flow will be far, far less profitable.

That’s why a number of Wall Street firms pushed back forcefully last year when it became apparent that Gensler was targeting their business models. Wholesalers and brokers ramped up their lobbying and campaign spending in Washington and published their own plans for improving the stock market. Virtu and Citadel Securities – which have been the names most often cited as frontrunners of retail orderflow, and in the case of Citadel, FINRA actually founds that’s precisely what Citadel does – have argued against the sort of changes the SEC is considering. In response, they revert to the oldest excuse in the playbook, that payment for order flow has underpinned a broad reduction to trading costs that has made the stock market more accessible.

Here’s the reality: PFOF is frontrunning of orderflow pure and simple, and while it may make trading slightly cheaper for retail investors, it also makes the entire market far more unstable as the core pillar of risk assets are HFTs which disappear at the first sign of trouble. In short: the liquidity provided by PFOF firms and their HFT algos is fake.

That doesn’t mean that the HFTs won’t fight tooth and nail to prevent the SEC from destroying them: billionaire Doug Cifu, CEO of Virtu, said the order-by-order competition sought by Gensler could allow trading firms more discretion in choosing which trades they fill. This could end up being more profitable in the short term for wholesalers, he said, but wouldn’t necessarily help investors.

“The SEC should engage all market participants before proposing significant untested changes that would harm retail investors’ execution quality and reduce retail investors’ access to our capital markets,” Mr. Cifu said in an emailed statement, reeking of desperation to preserve the status quo. As for Citadel, the Chicago-based HFT powerhour with an adjunct hedge fund did not even bother providing a comment to the WSJ.

* * *

And while we said that we’ll only believe it when we see it – because it is very bizarre to see the SEC actually pursue policies that truly protect markets and retail investors – the Journal reports that after a year of internal deliberations, the agency has homed in on a narrowing set of proposals. If the SEC votes to release them for public comment later this year, they would have a path to implementation, as Democrats hold a majority of seats on the commission.

The agency is also considering creating a more-stringent version of the so-called best-execution rule that directs brokers to find the most favorable terms for their customers, two of the people said. The rule that brokers currently follow was written by the Financial Industry Regulatory Authority, an industry body overseen by the SEC.

On the other side of the spectrum, the SEC is also weighing a proposal to allow stock exchanges to “subpenny,” i.e., quote shares in increments of less than 1 cent, a development that would enable venues like Nasdaq or the NYSE to better compete directly with HFT wholesalers, which can beat the prices publicly displayed on exchanges by adding or subtracting hundredths of a penny to the price of a stock. In other words, it would make the already crowded HFT playing field, so crowded it would be almost impossible to make a profit. Two people familiar with the matter said the agency is also considering an idea to harmonize the price increments, known as tick sizes, that are available on exchanges versus other venues.

In addition, SEC officials are aiming to reduce the maximum fee that exchanges can charge brokers to access their quotes, two of the people said. Like some of the other changes under consideration, such a move could encourage more orders to be sent to exchanges rather than to other venues.

The bottom line: don’t hold your breath, but it appears that some 13 years after this website first brought attention to the widespread scam that is HFT, the “high freaks” may be on their way out.

Not surprisingly VIRT stock slumped on the news, as did Robinhood, which is worth exactly $0.00 if it can’t sell retail orderflow to HFT internalizers.

And while Citadel is private, if it was public, its stock would share a similar pattern.

Tyler Durden
Mon, 06/06/2022 – 16:40

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Over 45,000 Americans Have Applied To Sponsor Displaced Ukrainians


Ukrainian woman on a bus as she flees her home

In late April, the Department of Homeland Security (DHS) announced the launch of a new private sponsorship program through which American citizens could support Ukrainians displaced by the Russian invasion. According to DHS data shared with CBS News last week, over 45,000 Americans have applied to help resettle Ukrainians in the United States since the Uniting for Ukraine program began.

United Nations data indicate that more than 14 million Ukrainians have left their homes since Russia invaded Ukraine in late February. Nearly 7 million of them fled to neighboring countries. Though millions of displaced people have already returned to safer regions in Ukraine, much of the nation remains under siege—and many Ukrainians are seeking family reunification and more stable homes elsewhere in the world.

Roughly 6,500 Ukrainians had arrived in the U.S. through the sponsorship program as of June 1, while another 27,000 have been authorized to travel here to join their American sponsors. Those coming here aren’t refugees in the technical sense of the word. Rather, they’re parolees, which means they can only live and work in the country for two years. The relief is designed to be temporary, which will deprive many Ukrainians of a lasting haven. But the program is nonetheless an important component of the global response to the exodus in Eastern Europe.

It arose at least partially in response to deep deficiencies in the U.S. immigration system. The American refugee resettlement program slowed severely thanks to the Trump administration and pandemic-era restrictions on cross-border movement. Just 11,411 refugees were resettled in the U.S. in FY 2021, short of an annual cap of 62,500. Other visa pathways have severe application backlogs, meaning that few existing immigration options were well-suited to handle the massive flight of Ukrainians. The fact that 22,000 Ukrainians were admitted after crossing the southern border only solidifies the necessity of laying out a predictable, direct pathway.

This private sponsorship initiative cuts the refugee program and its agency-based resettlement process out of the mix entirely. Instead, private citizens must connect with displaced Ukrainians (via Facebook, for example) and agree to financially support them before they may come to the United States. This ensures that Ukrainians arrive with a built-in safety net. The program’s breadth is directly linked to citizen-level generosity and welcome—important factors for sustainable refugee resettlement. The resettlement structure also helps funnel Ukrainians into the communities best-equipped to receive them. About 15 percent of American sponsors live in the New York metro area, and all other top sponsorship regions are major cities—many of them with large Ukrainian populations.

Uniting for Ukraine isn’t a perfect answer for every displaced Ukrainian, but it allows private citizens to get involved in immigration relief in a novel way. A far-off emergency scenario can leave many benevolent people wishing they had a practical way to help. This program is a meaningful start. The fact that 45,000 people have already volunteered to participate bodes well for the future of private sponsorship.

The post Over 45,000 Americans Have Applied To Sponsor Displaced Ukrainians appeared first on Reason.com.

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Elections Won’t Fix This

Elections Won’t Fix This

Authored by Jeffrey Tucker via The Brownstone Institute,

Americans have limitless faith in democracy. In the early 19th century, that charmed Alexis de Tocqueville. His book Democracy in America still rings true today because not much has changed. The entire country can be in ruins and even then, most people figure that it will all be improved or even solved come November. It’s been going on for our entire history. As a people, we believe our elections are what keep the people and not the dictators in charge. 

Surely some of this faith is necessary simply because it is the only option we have. The sitting president and his party are in deep trouble now, and most observers are predicting a rout in the midterm elections, granting us two additional painful years of inflation plus recession unfolding amidst what will surely be a brutal political stalemate and cultural upheaval. Then November will come again and with it another round of trust that the new president will figure something out. 

This faith in our elected leaders is belied by the experiences of the last 30 months. To be sure, the elected politicians are nowhere near blameless in what unfolded and they could have done far more to stop the disaster. Trump could have sent Fauci and Birx packing (maybe?), the Republicans could have voted no on trillions in spending (did they really have a choice?), and Biden could have renormalized the country (why didn’t he?). Instead they all went along…with what? With advisers from the bureaucracies, the people who have de facto ran the country for this entire grim period. 

Reading Scott Atlas’s book, one comes away with a very strange picture of how Washington worked in the first year of the pandemic. Once Trump gave the green light to lockdowns, the permanent bureaucracy had all it needed. In fact, this happened even before Trump approved it: the Department of Health and Human Services had already released its lockdown blueprint on March 13, 2020, a document which had already been weeks in the preparation. After the March 16 press conference, there was no going back. The “deep state” – by which I mean the permanent non-appointed bureaucracy and the pressure groups to which it answers – was running the show. 

The administrative state has probably not enjoyed such a good run since World War II or perhaps much earlier if ever. These were certainly the salad days. Merely by assigning a bureaucrat to type on a screen, the CDC could cause every retail business in the US to install plexiglass, force people to stand 6-feet apart, make the human face publicly invisible, close or open whole industries at will, and even scrap religious services and singing. To be sure, these were mere “recommendations” but states, cities, and corporations deferred for fear of liability should something go wrong. The CDC provided the cover but acted pretty much like a dictator. 

We know this for certain given the CDC’s response to the Florida’s judge’s decision to declare the transportation mask mandate illegal. The response was not that the mandate was both compliant with the law and necessary for public health. Instead, the agency and the Biden administration too rallied around a simple point: the judge’s decision cannot stand because courts should have no authority to override the bureaucracy. They actually said it: they demand total, unchecked, unquestioned power. Period. 

This is alarming enough but it speaks to a much larger problem: a hegemonic bureaucratic class that is not controlled by the political class and believes that it possesses total power. The implications extend far beyond the CDC. It applies to every executive agency of the federal government. They ostensibly operate under the authority of the office of the president but actually not even that is true. There are severe restrictions in place on the ability of the elected president to fire anyone among them. 

Trump couldn’t fire Fauci, at least not easily, and he was told this repeatedly. That pertains to millions of other employees in this category. This was not the traditional American system. In the days before 1880, it was routine for new administrations to toss out the old and bring in the new, and yes of course that included cronies. 

That system came to be derided as the “spoils system” and it was replaced by the administrative state with the Pendleton Act of 1883. This new law was passed in response to the assassination of President James Garfield. The culprit was an angry job seeker who had been rebuffed. The supposed fix, backed by Garfield’s successor Chester A. Arthur, was to create a permanent civil service, thus supposedly reducing the incentive to shoot the president. It initially pertained to only 10% of the federal workforce, but it had developed vast power by the time of the Great War. 

It wasn’t until I read Alex Washburne’s piece on Brownstone that the full implications became obvious to me. He cites the existence of something called the Chevron doctrine of deference to the agency. Whenever there is a question of an agency’s interpretation of the law, the court should defer to the agency and not to a strict reading of the law. Getting curious about this, I clicked through to the Wikipedia entry on the topic. 

Here is where we find the amazing revelation: this egregious rule came about only in 1984! The case in question was Chevron U.S.A., Inc. v. Natural Resources Defense Council, Inc. and the issue concerned the EPA’s interpretation of a Congressional statute. John Paul Stevens wrote in the majority opinion:

“First, always, is the question whether Congress has directly spoken to the precise question at issue. If the intent of Congress is clear, that is the end of the matter; for the court, as well as the agency, must give effect to the unambiguously expressed intent of Congress. If, however, the court determines Congress has not directly addressed the precise question at issue, the court does not simply impose its own construction on the statute . . . Rather, if the statute is silent or ambiguous with respect to the specific issue, the question for the court is whether the agency’s answer is based on a permissible construction of the statute.

All of this begs the question of what is permissible, but the critical thing is the dramatic shift in the burden of proof. A plaintiff against an agency must now demonstrate that the agency’s interpretation is impermissible. In practice, this rule has granted tremendous latitude and power to executive agencies to rule the whole system with or without political permission. 

And keep in mind what the chart looks like. 

The lower two-thirds of this chart is increasingly the government as we know it, and its power is unaccountable to the president, to Congress, to the courts, or to the voters. From what we know about the operations of the FDA, DOL, CDC, HHS, DHS, DOT, DOE, HUD, FED, and so on throughout every combination of letters you can think of, is that they are typically captured by private interests powerful enough to buy themselves influence, complete with revolving doors in and out. 

This creates a governing cartel that is a formidable force against democracy and freedom itself. This is a major and highly significant problem. It’s not clear that Congress can do anything about it. Worse, it’s not clear that any president or any court can really do anything about it, at least not without facing a barrage of brutal opposition, as Trump learned first hand. 

The administrative state is THE government. Elections? They provide just enough difference to lead people to believe they are in charge, but are they? Not according to the organization chart. This is the real problem with the US system today. This system cannot be found in the US Constitution. No one alive voted for it. It just gradually evolved – metastasized – over time. The last 30 months have demonstrated that it is a real cancer eating out the heart of the American experience, and not just here: every country in the world deals with some version of this problem. 

Americans’ romance with democracy continues unabated and right now, everyone I know is living for the great day in November when the existing crop of elected leaders can be shown a thing or two. Good. Throw the bums out. The question is: what should the new class of elected leaders do about this much deeper problem? Can they do anything about it even if they had the will? 

Keep in mind that it pertains not just to the public-health bureaucracies but to every aspect of public life in America. It’s going to take far more than a few elections to fix this. It is going to require focus and public support for a restoration of a genuine constitutional system in which the people rule with their elected leaders as their representatives, without the vast meta-layer of state control that pays no attention to the comings and goings of the elected class. 

In sum, the problems are much deeper than most people realize. These problems have been on display for the public in these past two-plus years. During this time, American life as we knew it was upended by an unaccountable administrative bureaucracy – in Washington but with reach into every state and city – that ignored the Constitution, evidence, public opinion, the pronouncements of elected leaders, and even the courts. 

Instead, this machinery of coercion ruled in concert with a network of private-sector actors, including media and financial companies, that have outsized influence and routinely use these agencies as weapons in their own economic interests at the expense of everyone else. 

This system is indefensible. Experiencing it first hand in the 1950s, Dwight Eisenhower decried the entire machine in his farewell address of 1961. He warned of the “danger that public policy could itself become the captive of a scientific-technological elite.” It is the task of statesmanship, he said, to uphold “the principles of our democratic system – ever aiming toward the supreme goals of our free society.”

Uprooting the entrenched, arrogant, hegemonic, and unaccountable administrative state that believes it operates with no limit to its power is the great challenge of our time. The public is probably nowhere near aware of the full extent of the problem. Until voters themselves figure it out, the politicians will have no mandate even to test a solution. 

Tyler Durden
Mon, 06/06/2022 – 16:20

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Bitcoin & Bond Yields Soar As Stocks Puke Payrolls-Gains

Bitcoin & Bond Yields Soar As Stocks Puke Payrolls-Gains

For once US Macro data did not disappoint today… because there were none.

Rate-hike expectations continue to rise (hawkishly) to its highest level since the May FOMC meeting and press conference…

Source: Bloomberg

Stock surged overnight (driven by enthusiasm about easing COVID restrictions in China, plus an influx in activity after several exchanges around the globe were closed last week for public holidays), recovering all the post-payrolls losses from an ugly Friday and prompting more asset-gatherers and commission-rakers to say ‘the bottom is in’. However, realization that surging bond yields were more a technical factor (heavy IG calendar) than fundamental, stocks puked all the gains back into the European close. The standard bid appeared, but the machines just could not hold it…

Nasdaq ended today down 1.5% from pre-payrolls levels as the majors basically feel back to Friday’s lows. Small Caps are the best performers, managing to get back to even…

From Friday’s close, stocks were basically unchanged (after Nasdaq rose 2% at its peak) before a late-day panic-bid lifted them…

Some “traders” are still nailing these turns…

As a reminder, AAPL just ‘death-cross’ed…

Source: Bloomberg

TWTR shares tumbled early on after Musk’s 13D filing, but buyers stepped in and limited the losses…

Stocks and bonds both fell (in price), with stocks having plenty of room for catch down for now…

Source: Bloomberg

Treasuries puked today on the back of a major IG issuance calendar. All the major selling pressure hit from the US cash equity open to European close leaving yields up 10bps across the curve…

Source: Bloomberg

All spot maturities 5Y and greater are back above 3.00%… and we note that the market is implying a totally flat term structure around 3.25% in one year…

Source: Bloomberg

It is also worth noting that European yield spreads are blowing out – back to COVID lockdown crisis levels (yields are higher too but this is the spread to Bunds)…

Source: Bloomberg

Time for the ECB to start buying again STAT! Italian ‘redenomination’ risk is soaring again…

Source: Bloomberg

The dollar rebounded from earlier losses today…

Source: Bloomberg

Bitcoin surged over the weekend, back above $31500, erasing last week’s puke…

Source: Bloomberg

And we note that Bitcoin’s recent outperformance relative to Ethereum has shifted that ratio back to significant support (for Ethereum)…

Source: Bloomberg

Gold slid lower on the dollar strength, back below $1850…

US NatGas surged over 9% today, back above $9 and at its highest close since Aug 2008…

US NatGas futures are now pricier than Day-Ahead European NatGas (“shared sacrifice”, right? “for democracy”?)

Source: Bloomberg

Finally, while it is noisy, we note that real yields are holding positive and it appears bitcoin and bullion are roughly tied to it…

And of course, unless you are living under a rock, US pump prices just hit a new record high…

Source: Bloomberg

Get back to work Mr.Biden!

Tyler Durden
Mon, 06/06/2022 – 16:00

via ZeroHedge News https://ift.tt/ZT3lAsS Tyler Durden

Respect The Fed? No, End The Fed!

Respect The Fed? No, End The Fed!

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

President Joe Biden has unveiled a three-part plan to fight inflation – or at least make people think he is fighting inflation.

One part of the plan involves having government agencies “fix” the supply chain problems that have led to shortages of numerous products. Of course, any attempt by the government to solve the supply chain problems (which were caused by prior government interventions such as shutting down the economy for over a year) will not just fail to solve the supply shortages but will create new problems.

Deficit reduction is another part of Biden’s anti-inflation plan. However, Biden is not proposing cutting welfare or warfare spending. Instead, his deficit reduction plan consists of “tax reforms to increase revenue,” which is DC-speak for tax increases. History shows that tax increases unaccompanied by spending cuts end up increasing the deficit.

The last and most important part of Biden’s inflation plan is recognizing that the Federal Reserve “has the primary responsibility to control inflation.” President Biden has pledged to “respect the Fed’s independence,” unlike former President Trump, who Biden accused of “demeaning the Fed” by subjecting the central bank to mean Tweets.

It is hard to believe that someone who has been in DC as long as Joe Biden really thinks Donald Trump was the first President to try to influence the Fed’s conduct of monetary policy. Since the Fed’s creation, Presidents have used public and private pressure to “convince” the Fed to tailor monetary policy to advance their policy and political goals. When it comes to “demeaning” the Fed, Trump has nothing on Lyndon Johnson, who, frustrated over the Fed’s refusal to tailor monetary policy to finance the Great Society and Vietnam war, threw the Fed chairman against a wall.

By “passing the buck” on inflation, Biden no doubt hopes to deflect blame from himself and his party before the midterm elections. Unlike Biden’s previous inflation scapegoats — greedy corporations and Vladimir Putin — the Fed actually is responsible for creating and controlling inflation.

Price increases in specific sectors of the economy may be caused by a variety of factors, but economy-wide price increases are always the result of the Federal Reserve’s easy money policies. Inflation is actually the act of money-creation by the central bank. Widespread price increases are a symptom, not a cause, of inflation.

Federal Reserve Chairman Jerome Powell remains committed to more rate increases this year. However, even if the Fed follows through on all its projected rate increases, rates will still be at historic lows. While there are those on the Fed board who want more and bigger rate increases, others worry that going too far too fast in increasing rates will cause a recession. Already many economic experts are saying America should be prepared for increase in unemployment caused by the Fed’s efforts to vanquish inflation. This “tradeoff” between high prices and high unemployment illustrates the insanity for our monetary policy.

Treasury Secretary and former Fed Chair Janet Yellen and Chairman Powell have both admitted they were wrong to publicly dismiss inflation as “transitory.” The fact that the two most recent Fed chairs made such a huge blunder (or purposely refused to admit what was clear to many people for over a year), shows the folly of relying on a secretive central bank to manage monetary policy. Instead of “respecting the Fed’s independence,” President Biden should work with Congress to audit, then end the Fed.

Tyler Durden
Mon, 06/06/2022 – 15:47

via ZeroHedge News https://ift.tt/JVazCd1 Tyler Durden

Lawsuit Against Kevin Spacey for Allegedly Touching Minor’s “Intimate Parts” Can Proceed

From today’s opinion by Judge Lewis Kaplan (S.D.N.Y.) in Rapp v. Fowler:

Plaintiff Anthony Rapp brings this action pursuant to New York’s Child Victims Act against Kevin Spacey Fowler, better known as Kevin Spacey, for sexual assault allegedly committed in Manhattan in 1986 when Mr. Rapp was 14 years of age….

Very briefly stated, Mr. Rapp claims that Mr. Fowler lifted him up, that Mr. Fowler’s hand his “grazed” Mr. Rapp’s clothed buttock for seconds as he did so, that Mr. Fowler placed Mr. Rapp back­ down on a bed, and Mr. Fowler then briefly placed his own clothed body partially beside and partially across Mr. Rapp’s. Mr. Rapp “wriggled out,” got up, and left the premises. Mr. Rapp testified at his deposition that there was no kissing, no undressing, no reaching under clothes, and no sexualized statements or innuendo. He acknowledges that the entire incident took no more than two minutes.

The complaint alleges that Mr. Fowler’s actions constituted assault, battery and intentional infliction of emotional distress. Mr. Rapp seeks compensatory and punitive damages….

Under the usually applicable New York statutes of limitations, these claims all would be time barred. In 2019, however, the Legislature enacted the Child Victims Act, which [revives otherwise time-barred claims based on] “injury … suffered as a result of conduct which would constitute a sexual offense … against a child less than eighteen years of age ….” …

[Mr. Fowler argues that, v]iewing the evidence in the light most favorable to the plaintiff and drawing in favor of the plaintiff all inferences reasonably drawn, as I must on Mr. Fowler’s motion [for summary judgment], a jury could not reasonably conclude that Mr. Fowler’s alleged actions constituted “a sexual offense as defined in article one hundred thirty of the penal law.” Mr. Rapp’s opposition to the motion relies exclusively on Penal Law Sections 130.52 and 130.55, which define the misdemeanors of forcible touching and sexual abuse in the third degree, respectively….

Forcible touching, in relevant part, occurs when a “person intentionally, and for no legitimate purpose … forcibly touches the sexual or intimate parts of another person for the purpose of degrading or abusing such person, or for the purpose of gratifying the actor’s sexual desire.” It “includes squeezing, grabbing or pinching.” …

The Appellate Division, First Department, of the New York Supreme Court has made clear that the term “intimate parts” as used in Penal Law Section 130.52, subd. 1, is not defined solely in terms of anatomy. In a case involve a kiss on the victim’s neck, it wrote: “… We conclude that, under general societal norms, the neck qualifies as an intimate part because it is sufficiently personal or private that it would not be touched in the absence of a close relationship between the parties. Moreover, since ‘intimacy is a function of behavior and not merely anatomy,’ the manner and circumstances of the touching should also be considered …. Here, defendant stripped naked, climbed onto the sleeping victim, and licked her neck. This conduct clearly fell within ‘the plain, natural meaning’ of the statute.” …

Accordingly, this Court is obliged to consider the manner and circumstances in which the touching allegedly took place in addition to the specific body parts with which contact allegedly was made. In this context, there is a genuine issue of material fact as to whether Mr. Fowler engaged in forcible touching of Mr. Rapp’s “intimate parts.” … [And] the record now before me, viewed in the light most favorable to the plaintiff, raises a genuine issue of material fact as to whether Mr. Fowler acted “for the purpose of gratifying … sexual desire.”

{There is no contention that there was any touching of Mr. Rapp’s “sexual parts.”}

The court held that the same analysis applied to the third-degree sexual abuse claim as well. Rapp’s “simple, common law assault claim” (which was based on “physical conduct placing the plaintiff in imminent apprehension of harmful contact,” rather than based on the harmful contact itself) couldn’t go forward, the court concluded, because the claim wasn’t covered by the Child Victims Act. But the court did allow the battery and intentional infliction of emotional distress claims to go forward.

The post Lawsuit Against Kevin Spacey for Allegedly Touching Minor's "Intimate Parts" Can Proceed appeared first on Reason.com.

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Ilya Shapiro Resigns From Georgetown University Law School


Candid of Ilya Shapiro on stage

Last week, Georgetown University Law School ended its investigation of incoming Center for the Constitution Director Ilya Shapiro. Administrators concluded that they would not discipline him over a poorly-worded tweet about Supreme Court Justice Ketanji Brown Jackson’s qualifications.

But now Shapiro has decided to resign from the position. In a statement, he explained that the university’s rationale—which gave him only a “technical” victory in this matter—would further imperil his teaching and his scholarship.

“After full consideration of the report of the Office of Institutional Diversity, Equity, and Affirmative Action (‘IDEAA Report’), and upon consultation with counsel, family, and trusted advisers, it has become apparent that my remaining at Georgetown has become untenable,” he wrote. “You cleared me on a jurisdictional technicality, but the IDEAA Report—and your own statements to the Law Center community—implicitly repealed Georgetown’s vaunted Speech and Expression Policy and set me up for discipline the next time I transgress progressive orthodoxy.”

The initial source of all this trouble was the following pair of tweets:

Objectively best pick for Biden is Sri Srinivasan, who is solid prog & v smart. Even has identify politics benefit of being first Asian (Indian) American. But alas doesn’t fit into the latest intersectionality hierarchy so we’ll get lesser black woman. Thank heaven for small favors?

Because Biden said he’s only consider[ing] black women for SCOTUS, his nominee will always have an asterisk attached. Fitting that the Court takes up affirmative action next term.

Shapiro apologized for them and was right to do so, since the bad phrasing could have left readers with the false impression that he was suggesting black women would make inferior SCOTUS appointees. But clearly, he wasn’t actually saying that: He meant to convey that he believed Sri Srinivasan was the best candidate from a progressive standpoint and would not be chosen due to gender and race considerations.

“Although my tweet was inartful, as I’ve readily admitted many times, its meaning that I considered one possible candidate to be best and thus all others to be less qualified is clear,” wrote Shapiro.

After subjecting Shapiro to a lengthy investigation, Georgetown determined he would go unpunished and should begin work. But the reasoning is key: Law Dean William Treanor said that the tweets had occurred prior to Shapiro taking the job, meaning they were not “subject to discipline.” Quite obviously, this left open the door to punishment in the future, if Shapiro tweeted (or said) something that caused a similar outcry. According to Shapiro:

Regardless even of the “effect” of what I tweeted on January 26, the IDEAA Report found that “if [I] were to make another, similar or more serious remark as a Georgetown employee, a hostile environment based on race, gender, and sex likely would be created.” (emphasis added.) On this theory, all sorts of comments that someone—anyone—could find offensive would subject me to disciplinary action. This would be a huge Sword of Damocles over my head as I try to engage in my educational mission.

Shapiro’s letter notes that there is a huge double standard at play here; he provides several examples of progressive faculty members’ statements that could have provoked offense among conservative and Republican students. None of these were investigated by IDEAA.

“All of these tweets were protected under Georgetown’s free-expression policy,” noted Shapiro. “But now they would all merit at least an ‘investigation’ to determine whether they violate the IDEAA’s theory of hostile educational environment that was selectively applied in my case. Apparently it’s free speech for thee, not for me.”

Shapiro has thus resigned his position, after all.

This is a frustrating outcome and one Georgetown could have easily avoided by sticking to its own free speech commitments, which expressly permit students and faculty to engage in broad free expression without fear of sanction. On paper, that commitment is clear: “It is Georgetown University’s policy to provide all members of the University community, including faculty, students, and staff, the broadest possible latitude to speak, write, listen, challenge, and learn,” it reads. “It is not the proper role of a university to insulate individuals from ideas and opinions they find unwelcome, disagreeable, or even deeply offensive. Deliberation or debate may not be suppressed because the ideas put forth are thought by some or even by most members of the University community to be offensive, unwise, immoral, or ill conceived.”

If Shapiro is not welcome at Georgetown, then that commitment is a hollow one.

The post Ilya Shapiro Resigns From Georgetown University Law School appeared first on Reason.com.

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