Biden DOJ Sues To Block Arizona’s Proof Of Citizenship Voting Law

Biden DOJ Sues To Block Arizona’s Proof Of Citizenship Voting Law

The Biden administration sued Arizona on Tuesday to block a new law requiring proof of citizenship in order to vote in federal elections.

Biden Attorney General Merrick Garland

Calling it a “textbook violation of the National Voter Registration Act,” Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division said that the law’s requirement was “onerous” – and took particular issue with provisions such as “requiring election officials to reject voter registration forms based on errors or omissions that are not material to establishing a voter’s eligibility to cast a ballot.”

The new law would require voters to prove citizenship using documentation such as a driver’s license, passport, birth certificate or naturalization papers.

A sign points voters to a voting center for the Democratic primary in Sun City, Arizona, U.S., March 17, 2020. REUTERS/Cheney Orr/File Photo

Clarke added that the new law, scheduled to take effect in January after it was signed into law by GOP Gov. Doug Ducey, is similar to an Arizona law struck down by the US Supreme Court in 2013.

The suit describes how the attorney for Arizona legislators warned them that the bill would violate federal law and contradict the earlier Supreme Court ruling. House Speaker Pro Tempore Travis Grantham said trying again “is a fight worth having,” according to the court filing.

State Attorney General Mark Brnovich suggested the Justice Department was encouraging undocumented immigrants to vote by filing the lawsuit. “I will once again be in court defending Arizona against the lawlessness of the Biden administration,” Brnovich said Tuesday. –NBC News

State AG Mark Brnovich said in response to the lawsuit: “Arizona has passed a law that turns the clock back on progress by imposing unlawful and unnecessary requirements that would block eligible voters from the registration rolls for certain federal elections,” tweeting later: “It’s another round of Brnovich v. Biden as his DOJ continues its attempts to undermine our election integrity laws.”

As ABC13 notes:

Arizona Attorney General Mark Brnovich told Clarke in a letter that he intendeds to defend Arizona’s H.B. 2492 all the way up to the U.S. Supreme Court if needed. He pointed to his victory in a separate election integrity suit from last year, in which he argued successfully in front of the Supreme Court that Arizona election integrity laws and policies did not violate the nation’s Voting Rights Act or the Constitution.

In his letter, Brnovich chided Clarke and the DOJ for using its resources “to challenge a common sense law,” while at the same time the Biden administration is “opening our borders to encourage a flood of illegal immigration.”

Brnovich questioned whether the DOJ was attempting “to undermine [Arizona’s] sovereignty” and “destabilize” the state’s election infrastructure.

“I hope that is not your intention,” he noted. “I strongly urge you to reconsider your pursuit of this misguided suit and to instead recognize Arizona’s constitutional authority to conduct lawful and secure elections.”

According to Gov. Ducey, the measure would address the more than 11,000 voters in 2020 that had not provided proof of citizenship, in a state where President Biden won by less than 11,000 votes.

Tyler Durden
Wed, 07/06/2022 – 11:05

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

Are US Gasoline Refiners Running Out Of Steam?

Are US Gasoline Refiners Running Out Of Steam?

Authored by Tsvetana Paraskova via OilPrice.com,

  • As petroleum stocks dwindle and demand soars, refining margins are skyrocketing.

  • U.S. refiners have been operating at full tilt in recent weeks to keep up with demand.

  • There is a growing concern that refiners may not have much room to safely increase capacity.

U.S. refineries have been operating at or near maximum utilization levels in recent weeks as demand recovers. Petroleum stocks are sitting at multi-year lows, and refining margins are sky-high.   Refinery utilization at 95% is at its highest since before COVID—September 2019. Yet, refiners don’t have much room to safely raise capacity usage further, while the summer season with heat waves and hurricanes could suddenly take some capacity off the market, further straining gasoline supply and putting upward pressure on gasoline prices. 

Refiners are running crude processing at full tilt. They are responding to U.S. President Joe Biden’s continuous pestering to produce more gasoline and lower prices at the pump, immediately, saying that there isn’t much spare capacity left to boost utilization rates without compromising safe operations. Analysts are of the same opinion, too. 

More Relief At The Pump On The Way?

A recent drop in international crude oil prices, which saw in June their first monthly drop since November 2021, coupled with lower gasoline demand and growing stocks in the past two weeks, have helped the average U.S. gasoline price ease back to below $5 a gallon, at $4.807 on July 4, down from a record-high of $5.016 on June 14.  

Gas demand currently sits at 8.93 million b/d, which is lower than last year’s rate of 9.11 million b/d at the end of June. On the other hand, total domestic gasoline stocks increased by 2.6 million bbl to 221.6 million bbl. These supply/demand dynamics and decreasing oil prices have pushed pump prices lower. As these trends continue, drivers will likely continue to see relief at the pump,” AAA said last week, just before the July 4 holiday weekend. 

The trend of high gasoline production is set to continue in the near future as refiners run at full tilt to take advantage of the high refining margins. The crack spreads are well above historical averages due to low inventories both in the U.S. and globally, fuel demand rising to near pre-pandemic levels, and lower product exports from Russia, the Energy Information Administration said last month. The EIA expects America’s refinery utilization to reach a monthly average level of 96% twice this summer, “near the upper limits of what refiners can consistently maintain.” 

In its June Short-Term Energy Outlook (STEO), the administration forecast that U.S. refinery utilization would be relatively high this summer in response to strong wholesale prices for petroleum products. These petroleum product prices have increased more than the price of the crude oil used to make them.

In the week of June 24, the average U.S. refinery utilization rate stood at 95%, with the East Coast and Gulf Coast rates at 98%, per EIA’s latest weekly report. It should also be noted that operable capacity across America’s refineries is now 17.944 million bpd, down by 1 million bpd compared to 18.976 million bpd two years ago. Several refineries have either shut down or started preparations to produce biofuels since the pandemic crashed fuel demand and posed uncertainty about the long-term business case for refiners.  

Risk Of Unexpected Outages Are Higher At Top Utilization Levels

But as refiner run rates rise, the risk of sudden outages also grows, analysts say. 

“Running hard increases general stress on a unit, increasing the risk of an unplanned outage,” Robert Campbell, head of oil products research at consultancy Energy Aspects, told Bloomberg last week. 

Testing the upper limits of refinery utilization could wear down processing units faster and requires more cooling of the equipment, especially in hot weather, according to Campbell. 

A sudden outage at a refinery this summer could exacerbate the fuel crunch as it would lower already low inventories. 

Then there is the Atlantic hurricane season, expected to repeat another above-average hurricane activity this year for the seventh consecutive above-average season, the National Oceanic and Atmospheric Administration (NOAA) warned in May, days ahead of the official start of the hurricane season on June 1. For the 2022 hurricane season, NOAA is forecasting a likely range of 14 to 21 named storms, of which 6 to 10 could become hurricanes, including 3 to 6 major hurricanes. 

If one or more of those expected major hurricanes make landfall along the U.S. Gulf Coast, where a lot of refining capacity is located, some refiners could be forced to preventively shut down or could be at risk of flooding, which would additionally tighten the fuel market in the United States.

Currently, U.S. refiners are producing at or near maximum levels, and they reiterated this in a letter last month in response to President Biden’s call to produce more gasoline and lower gasoline bills for American consumers. 

“Without corresponding increases in crude oil production, any benefit from incremental refining capacity would be essentially nullified by the increased crude oil demand and likely higher price,” the presidents of the American Fuel & Petrochemical Manufacturers (AFPM) and the American Petroleum Institute (API) wrote in a letter to the President. 

“That’s why it’s important to increase crude oil production. This global crude oil supply issue is not likely to be solved quickly, even if more refining capacity were available,” they say.  

Tyler Durden
Wed, 07/06/2022 – 10:45

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Job Openings Plunge By Most Since Covid Crash, Remain Stubbornly High: Nearly 2 Openings For Every Unemployed Worker

Job Openings Plunge By Most Since Covid Crash, Remain Stubbornly High: Nearly 2 Openings For Every Unemployed Worker

After recent reports that the US labor market had suddenly hit a brick wall, with mass layoffs surging…

… and job openings according to third-party trackers such as Revello showing that total job postings plunged by 22.5%, the biggest change on record…

… many were looking to see if these dismal trends would be confirmed by today’s closely watched JOLTs report, arguably the Fed’s favorite indicator of labor market softness (or tightness as the case is right now).

Well, for the second month in a row that did not happen, and instead the two-month delayed JOLTS report showed that in May, job openings did plunge by a whopping 427K, the biggest revised one-month drop since the covid crash, to 11.254 million but the drop was from a bigly upward revised 11.681 million in April (originally 11.4 million), the second highest print on record.

According to the report, the largest decreases in job openings were in professional and business services (-325,000), durable goods manufacturing (-138,000), and nondurable goods manufacturing (-70,000).

What is just as remarkable, is that despite one of the biggest drops in job openings on record, the continued tightening in the labor market, there was still a whopping 5.3 million more vacant jobs than unemployed workers in April, nearly double the 5.95 million total unemployed workers), suggesting that the US labor market remains extremely tight – and broken –  with the US unofficially sliding into recession.

And with far more job openings than unemployed workers, this meant that in May there were again less than 1 unemployed workers – a near-record low 0.52 to be exact – for every job opening.

With the number of job openings tumbling, it is not surprising that the number of hires also shrank, dropping from a downward revised 6.527MM to 6.489MM in May. According to the BLS, hires decreased in finance and insurance (-40,000).

One last observation comes from the May quits rate: after the number of Americans quitting their job hit an all time high 4.510 million last November, the number of people quitting their jobs has been declining modestly, and in April dropped to 4.270 Million, the lowest since January. Still, the number remains stubbornly high as workers continue to have much of the leverage and are happy to quit their job in search of better paying options elsewhere, hardly the stuff that indicates that wage-price spiral is about to end.

Tyler Durden
Wed, 07/06/2022 – 10:32

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Norway-Russia Tensions Escalate Over Sanctions Impacting Arctic Islands

Norway-Russia Tensions Escalate Over Sanctions Impacting Arctic Islands

Authored by Kyle Anzalone via The Libertarian Institute,

The latest point of confrontation between NATO and Russia is the Svalbard archipelago, located midway between Norway and the North Pole. Moscow claims Oslo is restricting trade with the island’s hundreds of Russian residents.

A top member of the Russian legislature is now calling for Moscow to leave its agreement with Oslo that resolved the territorial dispute over the far-northern archipelago. 

During a discussion about Norway restricting trade to the islands in the Russian Duma, the body’s speaker, Vyacheslav Volodin, requested the head of the chamber’s international affairs committee to look into “denouncing” the treaty. The agreement was signed in 2010.

In June, a shipment of goods to a Russian-operated mining colony on Svalbard was turned back. Moscow claimed the move by Oslo deprived the miners of needed food and medicine.

“Norwegian authorities are trying to leave Russian miners without food, which is inherently immoral. This violates human rights and the principles of humanism,” said Russian Senator Konstantin Kosachev. 

Konstantin went on to claim that Norway’s blocking of shipments violated international agreements. Oslo disputed the accusations saying it had not broken treaties and was legally enforcing sanctions.

The shipment was “stopped on the basis of the sanctions that prohibit Russian road transport companies from transporting goods on Norwegian territory,” Norway’s Foreign Minister Anniken Huitfeldt said.

Huitfeldt noted there were potential options to allow the Kremlin to supply the miners without violating sanctions. The Russian Foreign Ministry promised Moscow would take “retaliatory measures” in response, though did not elaborate on what that might entail.

Last month, according to Reuters, the Russian foreign ministry said it had “summoned Norway’s chargé d’affaires to protest against the restrictions, which it said have disrupted the delivery of critical supplies, including food and medical equipment.”

Tyler Durden
Wed, 07/06/2022 – 10:15

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US Services Surveys Signal “Bout Of Stagflation” Ahead, Employment Contracts Most Since COVID Collapse

US Services Surveys Signal “Bout Of Stagflation” Ahead, Employment Contracts Most Since COVID Collapse

With sentiment in freefall, and US macro data serially surprising to the downside – enough to prompt dramatic reductions in expectations for The Fed’s rate-hike trajectory – analysts expected Services surveys to follow their Manufacturing brethren lower in June.

  • S&P Global US Services PMI printed 52.7 in June, up from the flash print of 51.6 but down from the May print of 53.4

  • US ISM Services printed 55.3 in June, down from 55.9 in May, but better than the expected 54.0

Source: Bloomberg

Notably, S&P Global points out that US Composite New Orders fall for first time in almost two years.

The S&P Global US Composite PMI Output Index posted 52.3 in June, down from 53.6 in May. The latest rise extended the current sequence of expansion to two years, but was the softest since January. The slowdown in growth was broad based, with both manufacturing and services seeing weaker increases at the end of the second quarter. Business confidence also waned, dropping to the lowest since September 2020.

A weaker expansion in output reflected a renewed contraction in new orders, the first in almost two years. New business was down across both monitored sectors, with new export orders also falling. Rates of input cost and output price inflation remained sharp in June, but eased amid softer demand conditions.

Most notably, employment for both Services and Manufacturing contracted in June according to ISM…

Chris Williamson, Chief Business Economist at S&P Global Market Intelligence, said:

June saw signs of a broad-based weakening of the economy with demand now falling in both the manufacturing and service sectors. While the survey data point to a stalling of GDP at the end of the second quarter, a downshifting in the forward-looking new orders index and drop in companies’ future output expectations hints at falling economic activity as we head through the summer.

Demand for goods and services from households is showing signs of moderating substantially due to the rising cost of living. Meanwhile, tighter financial conditions are starting to hit, and it was notable that the service sector slowdown was led by a steep drop in financial services activity.

“Meanwhile there was welcome news in terms of a marked easing in upward price pressures, but it’s clear that price growth remains elevated despite coming off recent peaks, all of which points to a bout of stagflation in the near term.”

Not exactly the ‘picture of health’ The Fed keeps painting as being capable of withstanding multiple rate-hikes for the rest of the year.

Tyler Durden
Wed, 07/06/2022 – 10:04

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Americans’ Trust in Government Institutions Hits a New Low


Congress institutions trust decline Gallup poll presidency Supreme Court public schools

Americans’ confidence in major institutions like Congress, the criminal justice system, and the media has eroded in the past year, according to an annual Gallup poll. Of the 16 institutions included in the survey, Gallup reports that not a single one saw an increase in the number of respondents who say they “trust” that institution. Some of the declines, meanwhile, are quite striking. Just 23 percent of Americans say they trust the presidency, down 15 points from last year’s poll. The Supreme Court saw an 11-point drop in trust, from 36 percent to 25 percent, this year (and the survey was taken before the recent Dobbs abortion ruling). Congress somehow managed to decline a bit further, falling from 12 percent to just 7 percent.

Even institutions that most Americans continue to trust, like small businesses (68 percent) and the military (64 percent), saw slight declines in this year’s poll. Public schools, technology companies, and the media also lost trust with Americans this year, though not as dramatically as the more explicitly political institutions.

Democrats’ average trust in all 16 institutions fell by four points and Republicans’ average trust fell by five points. It’s the continuation of a long-running trend, though one that seems to have accelerated in the past two years—perhaps due to the number of institutions that had less-than-adequate responses to the pandemic.

“Notably, confidence in the major institutions of the federal government is at a low point, at a time when the president and Congress are struggling to address high inflation, record gas prices, increased crime, and gun violence, continued illegal immigration, and significant foreign policy challenges from Russia and China,” summarizes Gallup senior editor Jeffrey M. Jones.

“We don’t believe in anything any more,” writes CNN’s Chris Cillizza, who argues that declining trust in institutions shows how “a void has been created, which has led to a deep skepticism coursing through our culture.”

But that seems like a backward interpretation of what’s going on. Doesn’t it seem more likely that fewer Americans trust institutions—particularly government institutions, ranging from Congress to public schools—because those institutions have shown they do not deserve to be trusted?

Government institutions are not the ancient deities of Neil Gaiman’s imagination—they do not draw their power from the number of people who worship them. Indeed, the causality runs exactly in the opposite direction. Governments that accomplish useful purposes without causing too many new problems are rewarded with civic trust. It would be foolish for people to keep blindly trusting institutions that have repeatedly failed.

Trust must be earned, and institutions that earn trust are those that deliver on their promises. Amazon has an approval rating many times higher than Congress in no small part because people know that they can trust it to deliver products at low cost and on time.

The way to rebuild trust in our failing institutions, then, is pretty obvious. Instead of taking on new tasks for which governments are ill-suited—like the redistribution of resources or the imposing of virtue on society, as many on the left and right would like—those institutions should focus on doing the things they were created to do. Congress should balance the budget. The media should inform, not inflame. Public schools should educate children, not lock them out for two years.

Trust is earned by being accountable and functional. No wonder government institutions are polling so poorly.


FOLLOW-UP

The 21-year-old man, Robert E. Crimo III, accused of killing seven people and wounding dozens more at a Fourth of July parade in the Chicago suburb of Highland Park, Illinois, was charged Tuesday with seven counts of first-degree murder. Despite a history of promising violent action—police visited Crimo in 2019 after he threatened to kill himself, and later seized his knife collection after a family member reported other threats—Crimo was able to legally purchase the guns he allegedly used in Monday’s attack.

Two years ago, Illinois instituted a so-called “red flag” law along the lines of which President Joe Biden and a bipartisan group of lawmakers have called for passing at the federal level. The law allows police to confiscate weapons from otherwise law-abiding gun owners who are determined to be a threat to themselves or others.

In this case, like in many others, the red flag law on the books seems to have failed.


FREE MINDS

Dolly the sheep, the world’s first successfully cloned animal, was born 26 years ago this week. But the technology remains ethically fraught and scientifically difficult, even though the potential to use cloning to save endangered species (or resurrect extinct ones) remains tantalizing.

Now there might be a breakthrough, reports The Daily Beast‘s Neel V. Patel:

In a new study published in Nature Communications, Japanese researchers have outlined a new technique used to clone mice from freeze dried skin cells for the first time ever. The new technique paves the way for facilities around the world (even in poorer communities) to engage in what’s called biobanking: the storage of cells from certain animal species so they may be cloned later on should their numbers dwindle and their gene pools suffer from increased inbreeding.

As part of the study, the researchers freeze-dried skin cells from mouse tails and stored them away for nine months before attempting to make clones from them. Though the freeze-drying outright killed the cells, the researchers did some tinkering and learned they could still create viable cloned embryos by inserting the dead cells into mouse eggs where the nuclei were already removed.

Scientists were about to produce a total of 75 cloned mice using the new technique. Success rates ranged from 0.2 percent to 5.4 percent in various tests—not great, but a promising start—and the cloned mice were able to successfully breed with noncloned mice.


FREE MARKETS

Oil prices fell sharply on Wednesday, tumbling below $100 per barrel for the first time in months. Let’s start with the good news, which is that falling oil prices (if they remain at these levels) will likely translate into lower prices at the gas pump in the near future:

The bad news, however, is that falling oil prices could be yet another signal of a coming recession. A recession would quell demand for oil and gas, canceling out the higher prices created by the war in Ukraine’s effect on supply, The Wall Street Journal explains:

The war shows no immediate signs of winding down, but traders’ attention is shifting to the possibility that a downturn in economic growth could cool demand for fuel. Consumer spending and industrial orders showed signs of slowing in data released last week, underscoring investors’ building concerns about the possibility of a recession.

Maybe the White House can find some of those Bush-era “Mission Accomplished” banners in a box in the basement?


QUICK HITS

• The Food and Drug Administration has suspended its ban on Juul vaping products until the company’s lawsuit challenging the ban can be heard in court.

• British Prime Minister Boris Johnson could be on his way out after two senior ministers resigned and said they’d lost confidence in Johnson’s leadership.

• How the overturning of Roe v. Wade could shake up America’s established political alliances.

• Is artificial intelligence going to be totalitarian?

• Never talk to the FBI give the FBI personal information about your children:

The post Americans' Trust in Government Institutions Hits a New Low appeared first on Reason.com.

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China Slams US For “Technological Terrorism” As Chipmaking Gear Curbs Expand

China Slams US For “Technological Terrorism” As Chipmaking Gear Curbs Expand

As Washington and Beijing move towards technological decoupling, semiconductor chips and equipment have become the center point of national security efforts. The US has placed export controls against Chinese technology firms from purchasing chips and equipment. Now Washington is pushing the Netherlands to ban one of its top chipmakers from selling semiconductor equipment to Chinese companies. 

Bloomberg first reported Washington’s recommendation to Dutch chip equipment maker ASML Holding NV to halt selling some of its older deep ultraviolet lithography, or DUV, systems. Even though these machines are one generation behind cutting-edge, they can still make high-tech chips for automobiles and consumer electronics. 

Responding to the Bloomberg report, Chinese Foreign Ministry spokesman Zhao Lijian criticized Washington on Wednesday for “technological terrorism” as both countries are locked in a chip race. 

“This is yet another example of the US practice of coercive diplomacy by abusing state power and wielding technological hegemony. It is classic technological terrorism … This will only remind all countries of the risks of technology dependence on the US and prompt them to become independent and self-reliant at a faster pace,” Zhao told a regular news briefing Wednesday in Beijing.

If the Netherlands agrees, it will significantly increase the type of chipmaking equipment now prohibited for export to China. 

Washington has also pressured Japan to stop shipping semiconductor machines to China. 

Meanwhile, the writing was on the wall. Amir Anvarzadeh of Asymmetric Advisors said, “Chinese chipmakers have been hoarding second-hand equipment since the Trump era.” 

Anvarzadeh said banning the most advanced machines was “clearly not enough to halt China’s advancement in semiconductors, especially since much of the chips used for defense purposes are using geometries that were far less advanced.”

Since the Trump-era tariffs on consumer goods and export curbs on semiconductor chips and equipment for Chinese firms — China has been the biggest buyer of chipmaking gear in the last two years. 

The move by Trump to begin the curbs has been continued under the Biden administration, showing a much larger issue of America’s survival and worry about China catching up in the chip race.

Wall Street analysts responding to the Bloomberg report say a complete ban preventing ASML from exporting semiconductor equipment, such as deep ultraviolet lithography systems, is unlikely. Here are the thoughts of several analysts (list courtesy of Bloomberg): 

Evercore ISI analyst C.J. Muse (outperform) says the most likely outcome is continued restrictions on extreme ultraviolet lithography technology, but a full ban of ASML’s DUV portfolio may not materialize

  • Notes that ASML has paused shipments of its latest immersion tool NXT:2050i to China
  • ASML and the Netherlands will push back on bans of tools that are readily available from competitors
  • Thinks the Biden administration is looking to collaborate on a joint agreement with China

Citi analyst Atif Malik says more focused restrictions, such as curbing sales of US tech to SMIC, more likely than a broad-based ban

  • Views a full chip equipment ban as more directly linked to potential foreign policy escalations
  • Still, in a separate note, analyst Amit Harchandani (buy) says there could be more export control scrutiny around shipment to local Chinese chipmakers

Degroof analyst Michael Roeg (buy) says the discussion is not new, “yet it can easily scare investors”

  • There should be no impact on ASML and other chip tool makers in the short term “as there is no ban, and perhaps it will not come at all”
  • ASML could even see a short-term boost in demand as Chinese customers could be tempted to hoard DUV immersion equipment

Bloomberg Intelligence analysts Masahiro Wakasugi and Brian Moran say ASML’s sales could fall by 5% to 10% if it’s banned from selling deep ultraviolet tools in China

If ASML halts semiconductor equipment exports to China on behalf of Washington, the US must be prepared to accept the consequences.  

Tyler Durden
Wed, 07/06/2022 – 09:52

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

Americans’ Trust in Government Institutions Hits a New Low


Congress institutions trust decline Gallup poll presidency Supreme Court public schools

Americans’ confidence in major institutions like Congress, the criminal justice system, and the media has eroded in the past year, according to an annual Gallup poll. Of the 16 institutions included in the survey, Gallup reports that not a single one saw an increase in the number of respondents who say they “trust” that institution. Some of the declines, meanwhile, are quite striking. Just 23 percent of Americans say they trust the presidency, down 15 points from last year’s poll. The Supreme Court saw an 11-point drop in trust, from 36 percent to 25 percent, this year (and the survey was taken before the recent Dobbs abortion ruling). Congress somehow managed to decline a bit further, falling from 12 percent to just 7 percent.

Even institutions that most Americans continue to trust, like small businesses (68 percent) and the military (64 percent), saw slight declines in this year’s poll. Public schools, technology companies, and the media also lost trust with Americans this year, though not as dramatically as the more explicitly political institutions.

Democrats’ average trust in all 16 institutions fell by four points and Republicans’ average trust fell by five points. It’s the continuation of a long-running trend, though one that seems to have accelerated in the past two years—perhaps due to the number of institutions that had less-than-adequate responses to the pandemic.

“Notably, confidence in the major institutions of the federal government is at a low point, at a time when the president and Congress are struggling to address high inflation, record gas prices, increased crime, and gun violence, continued illegal immigration, and significant foreign policy challenges from Russia and China,” summarizes Gallup senior editor Jeffrey M. Jones.

“We don’t believe in anything any more,” writes CNN’s Chris Cillizza, who argues that declining trust in institutions shows how “a void has been created, which has led to a deep skepticism coursing through our culture.”

But that seems like a backward interpretation of what’s going on. Doesn’t it seem more likely that fewer Americans trust institutions—particularly government institutions, ranging from Congress to public schools—because those institutions have shown they do not deserve to be trusted?

Government institutions are not the ancient deities of Neil Gaiman’s imagination—they do not draw their power from the number of people who worship them. Indeed, the causality runs exactly in the opposite direction. Governments that accomplish useful purposes without causing too many new problems are rewarded with civic trust. It would be foolish for people to keep blindly trusting institutions that have repeatedly failed.

Trust must be earned, and institutions that earn trust are those that deliver on their promises. Amazon has an approval rating many times higher than Congress in no small part because people know that they can trust it to deliver products at low cost and on time.

The way to rebuild trust in our failing institutions, then, is pretty obvious. Instead of taking on new tasks for which governments are ill-suited—like the redistribution of resources or the imposing of virtue on society, as many on the left and right would like—those institutions should focus on doing the things they were created to do. Congress should balance the budget. The media should inform, not inflame. Public schools should educate children, not lock them out for two years.

Trust is earned by being accountable and functional. No wonder government institutions are polling so poorly.


FOLLOW-UP

The 21-year-old man, Robert E. Crimo III, accused of killing seven people and wounding dozens more at a Fourth of July parade in the Chicago suburb of Highland Park, Illinois, was charged Tuesday with seven counts of first-degree murder. Despite a history of promising violent action—police visited Crimo in 2019 after he threatened to kill himself, and later seized his knife collection after a family member reported other threats—Crimo was able to legally purchase the guns he allegedly used in Monday’s attack.

Two years ago, Illinois instituted a so-called “red flag” law along the lines of which President Joe Biden and a bipartisan group of lawmakers have called for passing at the federal level. The law allows police to confiscate weapons from otherwise law-abiding gun owners who are determined to be a threat to themselves or others.

In this case, like in many others, the red flag law on the books seems to have failed.


FREE MINDS

Dolly the sheep, the world’s first successfully cloned animal, was born 26 years ago this week. But the technology remains ethically fraught and scientifically difficult, even though the potential to use cloning to save endangered species (or resurrect extinct ones) remains tantalizing.

Now there might be a breakthrough, reports The Daily Beast‘s Neel V. Patel:

In a new study published in Nature Communications, Japanese researchers have outlined a new technique used to clone mice from freeze dried skin cells for the first time ever. The new technique paves the way for facilities around the world (even in poorer communities) to engage in what’s called biobanking: the storage of cells from certain animal species so they may be cloned later on should their numbers dwindle and their gene pools suffer from increased inbreeding.

As part of the study, the researchers freeze-dried skin cells from mouse tails and stored them away for nine months before attempting to make clones from them. Though the freeze-drying outright killed the cells, the researchers did some tinkering and learned they could still create viable cloned embryos by inserting the dead cells into mouse eggs where the nuclei were already removed.

Scientists were about to produce a total of 75 cloned mice using the new technique. Success rates ranged from 0.2 percent to 5.4 percent in various tests—not great, but a promising start—and the cloned mice were able to successfully breed with noncloned mice.


FREE MARKETS

Oil prices fell sharply on Wednesday, tumbling below $100 per barrel for the first time in months. Let’s start with the good news, which is that falling oil prices (if they remain at these levels) will likely translate into lower prices at the gas pump in the near future:

The bad news, however, is that falling oil prices could be yet another signal of a coming recession. A recession would quell demand for oil and gas, canceling out the higher prices created by the war in Ukraine’s effect on supply, The Wall Street Journal explains:

The war shows no immediate signs of winding down, but traders’ attention is shifting to the possibility that a downturn in economic growth could cool demand for fuel. Consumer spending and industrial orders showed signs of slowing in data released last week, underscoring investors’ building concerns about the possibility of a recession.

Maybe the White House can find some of those Bush-era “Mission Accomplished” banners in a box in the basement?


QUICK HITS

• The Food and Drug Administration has suspended its ban on Juul vaping products until the company’s lawsuit challenging the ban can be heard in court.

• British Prime Minister Boris Johnson could be on his way out after two senior ministers resigned and said they’d lost confidence in Johnson’s leadership.

• How the overturning of Roe v. Wade could shake up America’s established political alliances.

• Is artificial intelligence going to be totalitarian?

• Never talk to the FBI give the FBI personal information about your children:

The post Americans' Trust in Government Institutions Hits a New Low appeared first on Reason.com.

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Rabobank: What About Deflation?

Rabobank: What About Deflation?

By Elwin de Groot, Head of Macro Strategy at Rabobank

When we invoked Mundell & Fleming’s “Unholy Trinity” of i) independent monetary policy, ii) a fixed (stable) exchange rate and iii) the free movement of capital in yesterday’s Global Daily, we couldn’t have been timed better. Although we actually applied the type of reasoning to the ECB’s aims of setting rates (and spreads), controlling the amount of base money and trying to prevent fragmentation at the same time, it was the original Mundell-Fleming type that put its mark on markets yesterday.

Of course we are talking about the EURUSD exchange rate which fell straight through the 1.035 ‘technical barrier’ (a previous low set late 2016, early 2017) all the way to a 20-year low of 1.0240, leading to speculation among market participants that parity is now “within reach”.

The reason behind the currency’s weakness is the growing doubt in the market that the ECB may be able to push through a series of rate hikes –which, as a reminder, it has yet to start– before any recession kicks in. The yield on 2-year German Schätze fell more than 15bp to 0.43%. Our FX strategist, Jane Foley, notes that while we have been warning of recession risks in the Eurozone for some time, broader market concerns surrounding from energy security in Europe have been hitting home in recent sessions. This in turn is focusing attention on Eurozone fragmentation risks and the tricky policy position of the ECB, all of which is EUR negative.

And what about deflation? That’s a surprising question I got from a Dutch client last week and it even caught me off-guard. But they were right, it’s not a scenario to be entirely dismissed for 2023. Newton’s Third Law of Motion, which states that when one body exerts a force on another body, the second body exerts a force on the first body that is equal in magnitude but opposite in direction, often can be applied to economies and markets as well. This is not to say that this means things are predictable (far from it!), but it does remind us of the possibility that what goes up, can also come down.

So is ‘demand destruction’ now at work? Well, perhaps were seeing the first signs of it. Although headline PMI surveys in Europe are still “above 50”, forward-looking indicators such as order-intake and export orders in industry have fallen below that threshold in recent months. In any case, many commodity prices are seemingly experiencing Newton’s law of gravitation. Brent oil fell below $105 a barrel (end-June it was still trading at EUR 120), base metal prices (notably copper) are sliding and even agri commodities have fallen quite sharply over the last several weeks. For the latter, a case in point is palm oil, which is down 40% since its intraday record set in May. The reason: Indonesia raised its export quotas in order to get rid of excess stockpiles – which themselves are the result of its temporary export ban in April-May. Talking about action-reaction.

Of all major base metals and agri-commodities including, believe it or not, wheat and softs such as sugar and cotton, there is only one commodity whose (nearest-term future) price is still above the levels recorded just before war in the Ukraine broke out: iron ore. It is therefore no surprise that Bloomberg’s broad commodity price index has now fallen all the way back to 112.4 (it stood at 113.5 on 22 February), after having reached 136.6 on 9 June. In other words, in less than a month, all commodity price gains since the Ukraine war have been wiped out.

The last big ‘hold-out’ in that respect is European energy. The 1-m forward benchmark contract for European gas briefly jumped above $170 yesterday, which is the highest level since 8 March. A strike by Norwegian offshore workers that started Monday and broadened Tuesday was arguably the immediate cause for the jump in gas prices, but this comes against the backdrop of fears that Russian supply through Nordstream-1 may not come back on after maintenance work on the pipeline has been finished later this month. Norway is the UK’s largest gas supplier and is now also responsible for around 25 percent of European mainland’s gas, second after Russia, the FT reports. The positive news this morning, though, is that the Norwegian government has intervened in the industrial conflict (it has the power to do so under certain conditions), proposing ‘compulsory wage arbitration’ between the Lederne union representing the sector’s workers and employers. How much is securing the supply of a crucial input to everyone involved worth? I guess that is a question that will be asked a lot more in what looks like already being a hot European summer.

Meanwhile, UK PM Johnson may also be sweating – not just because of the summer heat. Although he has been under fire for months, Johnson still enjoyed the support of his cabinet members for a long time. This support is now crumbling. Last night, Health Minister Javid and Finance Minister Sunak resigned almost simultaneously out of dissatisfaction with his leadership. Replacements were immediately appointed in the persons of Barclay and Zahawi, but given the ongoing unrest, the question is how long they can enjoy their new office. It could mean that the government will come up with popular measures, such as another tax cut, in an effort to regain the confidence of voters and party members. Remarkably, traders in the British pound showed little sympathy for Prime Minister Johnson last night. There was no price reaction and EUR/GBP is now trading just below 0.86. This suggests that the British economy might be better off with a new prime minister.

Tyler Durden
Wed, 07/06/2022 – 09:30

via ZeroHedge News https://ift.tt/zjsmVo9 Tyler Durden

Biden Faces Major Decision In Khashoggi Fiancée’s Suit Vs Saudi Crown Prince

Biden Faces Major Decision In Khashoggi Fiancée’s Suit Vs Saudi Crown Prince

A federal judge has given the Biden administration an August 1 deadline to render an opinion on whether Saudi Crown Prince Mohammed bin Salman should be granted sovereign immunity in a civil suit filed by Hatice Cengiz, the widow of journalist Jamal Khashoggi. 

Mohammed bin Salman, commonly referred to as MBS, stands accused of ordering Khashoggi’s October 2018 murder at the Saudi consulate in Istanbul. A Washington, DC resident and writer for the Washington Post, Khashoggi was an outspoken critic of the crown prince and was launching an organization called Democracy for the Arab World Now (DAWN).

“In the Court’s view, some of the grounds for dismissal advanced by defendants might implicate the interests of the United States; moreover, the Court’s resolution of defendants’ motions might be aided by knowledge of the United States’ views,” wrote Judge John Bates, according to Middle East Eye.

The judge’s deadline will arrive just two weeks after Biden’s mid-July trip to Saudi Arabia. Human rights activists have condemned Biden for a visit that will betray his campaign promise—animated by Khashoggi’s murder—to turn the kingdom into an international “pariah.”  

Biden’s pledge came at a 2019 Democratic debate. When asked if he would “punish” senior Saudi leaders for Khashoggi’s murder, Biden replied

“Yes….Khashoggi was in fact murdered and dismembered, and I believe on the order of the crown prince. And I would make it very clear we were not going to in fact sell more weapons to them. We were going to in fact make them pay the price, and make them in fact the pariah that they are. There’s very little social redeeming value…in the present government in Saudi Arabia.”

The Biden administration leveled sanctions against 76 Saudis associated with the murder, but spared MBS.  

The backlash over Biden’s Saudi Arabia trip would grow exponentially if it’s quickly followed by a recommendation of sovereign immunity that shields MBS from Khashoggi’s fiancee, who paced outside the Saudi consulate deep into the night, waiting for him to come back outside. 

The White House has the option to simply give the court notice that it has no view on the sovereign immunity question.

However, even if the Biden administration is content to see MBS face civil suit scrutiny, the U.S. government may have its own reasons to help kill the lawsuit: If the case proceeds to discovery, plaintiff attorneys will be pressing the U.S. government to release its own sensitive files on the murder.

Indeed, when the suit was filed, DAWN executive director Sarah Leah Whitson said“We look forward to seeing MBS in court and finally obtaining discovery of all of the evidence—including who knew what, when, in our own government—implicating MBS and his co-conspirators in this vicious crime.” DAWN is a plaintiff alongside Cengiz.

MBS has acknowledged the Saudi government’s responsibility for the murder, but denies any personal involvement in it. A CIA assessment concluded with “medium to high confidence” that MBS “personally targeted Khashoggi.” Noting the killers were from MBS’ top security units, the CIA said, “We assess it is highly unlikely this team of operators…carried out the operation without Muhammed bin Salman’s authorization.”

The application of the U.S. Foreign Sovereign Immunities Act—a 1972 law that supports a longstanding international principle that rulers and governments shouldn’t be subject to other country’s laws—is complex. In making a determination on a claim of sovereign immunity, courts grant considerable deference to the executive branch.  

“Courts’ deference to executive suggestions of immunity stems from a recognition of the executive’s exclusive control over and superior expertise in the implementation of foreign policy,” explains Eleanor Runde at Lawfare. “But whether executive branch suggestions of immunity are absolutely binding or merely weighty is an open question.”

The suit by Cengiz and DAWN also targets some 30 other Saudis accused of participating in the plot to lure Khashoggi to the Saudi consulate under the pretext of giving him a certificate of marriage eligibility, murder him and dismember his body, which has never been recovered.  

Drawing on media accounts citing intelligence and other sources, the complaint filed in the civil suit covers the grisly details of a highly-organized plot (start on page 34) that even included a Khashoggi body double walking around Instanbul in the dead man’s clothes. The New York Times video embedded below provides a more cinematic overview that incorporates security camera footage. 

 

 

Tyler Durden
Wed, 07/06/2022 – 09:10

via ZeroHedge News https://ift.tt/19QxC2L Tyler Durden