Streetwise Professor

November 7, 2017

If the Dems Keep This Up, Ima Gonna Run Outta Popcorn

Filed under: Politics,Russia — The Professor @ 9:59 pm

The Democratic establishment has gone to DefCon One over Donna Brazile’s (so far only excerpted) blasts directed at the Hillary campaign. The biggest return salvo was in the form of an open letter signed by dozens and dozens, including notables such as Huma Abedin (Hillary’s constant companion, who frequently wore an outfit to match Hillary’s–yeah, I don’t want to know either), Robby Mook (campaign director), and–wait for it–Marc Elias (the Perkins Coie lawyer who was the intermediary between the Clinton campaign and Fusion GPS, which in turn was the connection to Christopher Steele of dossier infamy). The whole thing is a hoot, but this part totally cracked me up: “It is particularly troubling and puzzling that she would seemingly buy into false Russian-fueled propaganda, spread by both the Russians and our opponent, about our candidate’s health.”

I mean it had to be the Russians, right? Had. To. Be.

First, this is now the Democrats’ Theory of Everything: THE RUSSIANS DONE IT. Second, who could possibly have had any doubts about Hillary’s health? That nagging cough? Nothing! The fainting spell (or freezing episode) or whatever it was on 9/11/16? Just “overheating.” Brazil also points out some odd Hillary public behavior, most notably her infamous “basket of deplorables” comment, which led Brazile to wonder whether Clinton was so mentally out of it that she wasn’t aware that she was speaking in public, rather than at a closed event.

In other words, far more than the rest of us, Donna Brazile had the ability to observe closely Hillary’s health, and it raised grave concerns in her mind. Yet Hillary’s phalanx of flunkies denies Brazile’s first hand knowledge, and instead blames her concerns on Russian propaganda.

Unbelievable. The only thing Russian about this entire episode is the Hillary cabal’s obfuscation of her health issues, which brings back memories of the last days of Chernenko or Brezhnev.

For her part, Brazile has been nothing if not entertaining. First, she denied that the word “rigged” is in her book. Well, it is definitely in the Politico piece which is allegedly an excerpt, and everyone who read that concluded that Brazile was accusing the DNC of rigging the process against Bernie: if not, why the candles and the music to put her at peace before the confessional phone call to Sanders? But maybe her book has undergone a quick rewrite (perhaps like James Comey’s letter regarding Hillary’s server, which included the legally damning phrase “grossly negligent” before it didn’t). Or something.

Second, Brazile accuses the campaign leadership of being sexist, and treating her like a slave. Randy Mook in particular comes in for damning criticism. I’m not a big Brazile fan, but Mook is a first class creep, so it’s an easy call regarding whom to pull for here.

Third, she makes some rather odd statements about murdered campaign Seth Rich. This has sent conspiratorial minds–of which there are far too many these days–into paroxysms of theorizing.

There are many conjectures about Brazile’s motives. Self-protection is a leading candidate in the comments section. Shifting blame and making money are others. Revenge is also in the running. Another theory making the rounds is that she is attempting (perhaps at the behest of the Bernie branch of the party) to torpedo a potential Hillary! 2020 repeat. Yes, some think that Hillary is in fact scheming to run again. I can understand many Democrats’ horror at the thought–she would be a very serious contender to tie William Jennings Bryan and Adlai Stevenson as three time losers (though Stevenson, of course, only was the party’s standard bearer twice, losing the party’s nomination to JFK in 1960, as Hillary did to Obama in 2008).

I’m going with “all of the above.” I think this is a seriously overdetermined mixture of the personal and the political. Whatever it is, I hope she keeps on it. Though if she does I’ll have to restock the popcorn because I’m going through it like crazy.

Circling back to the Russia obsession. Have you noticed that the Russians are inveterate liars spewing disinformation everywhere, except when a Russian is dishing dirt on Trump, in which case they are telling the gospel truth? The dossier is one example: to the Dems and Never Trump Republicans, it is Matthew, Mark, Luke, and John rolled up into one. Another example is the recent story that the lawyer who met with Donald Jr., one Natalia Veselnitskaya, claims that Junior “hinted at a review” of the Magnitsky Act if Veselnitskaya could provide evidence in writing of Clinton skullduggery.

Did he give an exaggerated knowing wink? Or maybe he did the whole “grin, grin, nudge, nudge, wink, wink, say no more!”thing. I mean, seriously.

So since when did Veselntiskaya–a Russian!–become unimpeachably credible? Especially in light of numerous revelations suggesting that the Russians were (are?) not acting in a partisan way, but were (are?) merely intending to sow political chaos. In which case (a) they are succeeding beyond their wildest expectations, and (b) Huma and the Gang are accessories after the fact, and are compounding the chaos spawned by whatever Russian interference there was by overreacting to Russian interference.

Another revelation about Veselnitskaya came out today. In Congressional testimony in July, Bill Browder alleged that she hired Fusion GPS to conduct a smear campaign against Browder, a Russian bête noire.* Today it was reported that she met with Fusion GPS’s Glenn Simpson both immediately before and immediately after the Trump Tower meeting. You know, kinda like a briefing and debriefing. We also know that some time before this the Hillary campaign via Marc Elias had hired Fusion GPS to dig dirt on Trump (“opposition research” we’re told).

I don’t know about you, but to me that screams set-up. The Clinton-Fusion-Russia nexus is just too tight. (Note to the sickening hypocrisy. The outrage over the Trump Jr.-Veselnitskaya meeting is that he was looking for compromising material on Hillary. First, isn’t that just “opposition research”, per the Democrats’ defense of the Clinton hiring of Fusion? Second, for the people who hired dirt diggers par excellence-Fusion GPS–to get dirt on Trump from the Russians to wax indignant about Trump responding to offers of dirt on Hillary from Russians pegs the chutzpah meter–and mine goes to 11!)

So here’s where we are. Donna Brazile blasted Hillary and her campaign. Hillary’s henchpeople responded by saying that Brazile was a dupe for propaganda put out by those lyin’ no good Russkies. Meanwhile, the Hillary campaign hired a propaganda outfit with deep connections with the Russians, including Russians who just so happened to be in meetings that the Democrats and the media (but I repeat myself) claim compromised Trump. But to believe that, you have to believe that the lyin’ no good Russkies are telling the truth. Just this once!

Did I get that right? Pretty sure that I did. Truth is indeed stranger than fiction.

* Do not consider this an endorsement of Browder. In fact, I am not a Browder fan. I will detail the reasons for my distrust and dislike in an upcoming post.

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November 3, 2017

Did Donna Brazile Find a Horse’s Head in Her Bed This Morning?

Filed under: Politics — The Professor @ 10:53 pm

Who you gonna believe, Donna Brazile or your lyin’ eyes? I read the Politico piece  carefully, and I damn sure reached the conclusion that Brazile had confessed to Bernie Sanders that the DNC had rigged the process. But Donna says No! I said nothing of the sort. Indeed, she has started a hash tag, #NeverSaidHillaryRiggedElection.

So I read the article again, and I still conclude that’s exactly what she said.

Several people commented last night that Brazile’s jeremiad had put her in mortal danger. Today’s furious attempt to deny what was clearly said the day before surely does suggest that Donna awoke this morning to find a horse’s head in her bed, and that got her mind right.

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November 2, 2017

Donna Brazile Unloads on Hillary, and Gives SWP a Target Rich Environment!

Filed under: Politics,Russia — The Professor @ 7:16 pm

Donna Brazile–a long time Democratic operative and DNC official–has a book coming out. And the excerpt in Politico is damning of the erstwhile leaders of the Democratic Party.

To me the most interesting reveal is that the Lightworker left the Democratic Party’s finances is an utter, absolute shambles:

Obama left the party $24 million in debt—$15 million in bank debt and more than $8 million owed to vendors after the 2012 campaign—and had been paying that off very slowly. Obama’s campaign was not scheduled to pay it off until 2016. Hillary for America (the campaign) and the Hillary Victory Fund (its joint fundraising vehicle with the DNC) had taken care of 80 percent of the remaining debt in 2016, about $10 million, and had placed the party on an allowance.

This fits with my image of Obama as Mr. Magoo, who cheerily drove along, always coming out ahead, while leaving carnage in his wake. We already knew about how Democratic officeholders at the state, local, and Congressional levels were scourged during the Obama administration: now we know he did the same to the Democratic Party’s finances.

This, in turn, left the DNC vulnerable to the Clinton mafia, who basically extended juice loans to the DNC. In return for financing the party to allow it to exist, Hillary’s campaign demanded, and received, control over its finances, and most of its key personnel choices. Hillary used this arrangement to launder campaign contributions in a way that clearly was intended to circumvent federal limits on donations to individual campaigns.

Oh, and “launder” isn’t my word choice: it’s Politico’s. Here’s how Brazile explains it:

“Gary, how did they do this without me knowing?” I asked. “I don’t know how Debbie relates to the officers,” Gary said. He described the party as fully under the control of Hillary’s campaign, which seemed to confirm the suspicions of the Bernie camp. The campaign had the DNC on life support, giving it money every month to meet its basic expenses, while the campaign was using the party as a fund-raising clearinghouse. Under FEC law, an individual can contribute a maximum of $2,700 directly to a presidential campaign. But the limits are much higher for contributions to state parties and a party’s national committee.

Individuals who had maxed out their $2,700 contribution limit to the campaign could write an additional check for $353,400 to the Hillary Victory Fund—that figure represented $10,000 to each of the 32 states’ parties who were part of the Victory Fund agreement—$320,000—and $33,400 to the DNC. The money would be deposited in the states first, and transferred to the DNC shortly after that. Money in the battleground states usually stayed in that state, but all the other states funneled that money directly to the DNC, which quickly transferred the money to Brooklyn [i.e., Clinton campaign headquarters].

“Wait,” I said. “That victory fund was supposed to be for whoever was the nominee, and the state party races. You’re telling me that Hillary has been controlling it since before she got the nomination?”

Gary said the campaign had to do it or the party would collapse.

“That was the deal that Robby struck with Debbie,” he explained, referring to campaign manager Robby Mook. “It was to sustain the DNC. We sent the party nearly $20 million from September until the convention, and more to prepare for the election.”

The states’ take for being the front for this fundraising scheme? “Yet the states kept less than half of 1 percent of the $82 million they had amassed from the extravagant fund-raisers Hillary’s campaign was holding, just as Gary had described to me when he and I talked in August.” One percent? Credit card companies collect more for processing payments.

Brazile claims that this was not illegal, merely unethical. I have no doubt that it was unethical. The legality is hardly obvious, given that it effectively allowed the Clinton campaign to blow through the $2,700 limit on individual contributions to campaigns. Blow through by a factor of 13. That’s all. No big deal, right?

Hillary, you might recall, claimed to be a stalwart supporter of campaign finance reform. But here she was playing a shell game that made a travesty of existing contribution limits.

And who is this “Gary”, you ask?

GiGi! That’s right. The Gary is none other than Gary Gensler. The Saint of the CFTC. Crusader for financial probity. Yet he was neck deep in a scheme that not only was a mockery of the campaign finance system, but which also effectively made the DNC the adjunct of the Clinton campaign during the primary season, when it was supposed to be non-partisan.

Ah, what ambition does to a man’s morals, eh there, Gar? Appalling. It profits a man nothing to give his soul for the whole world . . .  but for the Secretary of the Treasury?

Brazile seems to cut Gensler some slack. After all, he didn’t negotiate the deal. He just counted the beans.

Like Al Capone’s accountant.

There’s one other terribly revealing thing about all this. No, not that Hillary is a grotesquely unethical and manipulative woman: that’s hardly news. What’s eye opening is that she was so insecure that she felt that she had to rig the Democratic primaries by suborning the DNC, and making it her creature.

Yet the woman who was so nervous about winning her own party’s nomination wants us to believe that the only way she wasn’t anointed as president must have been the nefarious doings of the likes of the Russians and Jim Comey.

And now that I mention the Russians, consider this. An alternative explanation for the release of the DNC emails is that it was the work of a disenchanted Bernie Bro, not a Russian hacker. I always thought this was plausible, and none other than stalwart Democratic operative Donna Brazile makes it eminently clear that Bernie supporters working in the DNC would have had every reason to be outraged, because their guy was getting shafted the way only the Clintons can.

So by going after Hillary, Donna Brazile has created a target rich environment for the likes of me. Not just Hillary, but Obama, Gary Gensler, and the Russians hacked the DNC conventional wisdom. And that was just an excerpt. I can hardly imagine what the whole book will bring.

I never thought I’d say this, but here it goes: Thanks, Donna!

 

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October 31, 2017

Kelly Causes Mass Apoplexy, Again

Filed under: Civil War,History,Politics,Uncategorized — The Professor @ 7:56 pm

John Kelly shares his boss’ ability to cause mass apoplexy on the left. And I think he knows it, and does it deliberately.

Kelly caused today’s mass freakout by making remarks about Robert E. Lee and the Civil War. He committed three grave sins.

First, he criticized presentism, which is an -ism that the left wholeheartedly endorses:

“There are certain things in history that were not so good, and other things that were very, very good,” Kelly said. “I think we make a mistake as a society, and certainly as individuals, when we take what is accepted as right and wrong, and go back 100, 200, 300 years or more and say, ‘What Christopher Columbus did was wrong.'”

“Five hundred years later, it’s inconceivable to me that you would take what we think now and apply it back then. I just think it’s very very dangerous. It shows you how much of a lack of appreciation of history and what history is,” said Kelly, a retired Marine Corps General.

Just so. Exactly.

Then, he defended Robert E. Lee as an honorable man:

“Robert E. Lee was an honorable man who gave up his country to fight for his state,” Kelly said. “One hundred and fifty years ago, that was more important than country — it was always loyalty to state back in those days.”

As a matter of historical truth, this is also spot on. Who disputes that Lee chose his state over the United States?–but only after secession, and when his state was threatened with invasion.

Whether this conduct is honorable or not is fundamentally subjective. Honor–as Lee understood it, and as people like Kelly understand it–means living up to a certain code of conduct, adhering to one’s beliefs, even at great personal cost. The underlying beliefs are not objectively verifiable: they inhere in the subject. Honor involves adhering to them.

Now, you may object to Lee’s code, and what his beliefs were. But it is nigh on to impossible to dispute that he made his choice in good conscience, fully recognizing the personal risks he was taking.

Insofar as that code is concerned, Lee was acting on the basis of a theory of the United States, and the Constitution thereof, that was widely held in the South. Namely, that the Union was a compact of sovereign states, and that states had the right to depart from the Union of the federal government infringed on the rights of the states. In this view, the purpose of Union was to defend the rights of the states, and an infringement by the federal government on those rights justified the dissolution of the Union.

The Civil War basically ended that theory as a practical force in American politics, but it was a viable, and widely held, theory in 1861. And under that theory, one was a citizen of the US via one’s citizenship in a state. The state was more basic, more fundamental, than the union of the states.

Many object that Lee swore an oath to the US. A couple of things here. First, hard cases–situations where basic principles are in conflict–make bad law. Lee indeed agonized over his oath and his divided loyalties. Second, under the theory that Lee (and others) operated, obligations went both ways: the federal government had obligations to the states, and their citizens. In the minds of many Southerners, the government’s violation of its obligations relieved them of theirs. And rightly or wrongly, many Southerners viewed those rights to be at risk as the result of Lincoln’s election in 1860.

This theory was taken very seriously. So seriously, in fact, that it greatly–and some would argue fatally–impaired the Confederate war effort. Southern governors, most notably Joseph Brown of Georgia, drove Jefferson Davis to distraction with their strict insistence that the Confederate government in Richmond respect the rights of their states. Jefferson Davis was one of those who claimed that this was indeed fatal to the South because it undermined a unified war effort necessary to achieve victory. When he said the epitaph of the Confederacy was “Died of a Theory,” the theory he was referring to was that of states’ rights.

It is true that many have dishonestly claimed that the insistence on states’ rights shows that the Civil War wasn’t about slavery. In fact, these are not alternative theories of secession, or the war, but complementary ones. The right that Southern states were insistent upon, to the point of dissolving the Union, was that of a state to choose its “domestic institutions.” And the domestic institution the Southerners were willing to fight over was that of slavery.

You may argue against the theory, but you can’t credibly argue that Lee was dishonorable in adhering to the principles thereof. One may be an honorable and faithful servant of a false god.

Among his contemporaries–including many Northerners–Lee was considered an honorable man, and indeed perhaps, the archetypal honorable man. Recall that Grant saluted Lee on the steps of the McClean House at Appomattox, after accepting the surrender.

Lee was also from an honor culture, or cultures, actually–the South, and the military (and the antebellum military was deeply infused with Southern cultural values). Lee’s idea of honor no doubts resonates with Kelly, the product of another honor culture, the US Marine Corps.

Again, you may dislike or even ridicule this culture (as Twain did in Huckleberry Finn) but you cannot deny its existence or fundamental features, or claim that Lee did not strive to adhere to its values and strictures.

But Kelly’s biggest sin was this:

Now it’s different. But the lack of an ability to compromise led to the Civil War, and men and women of good faith on both sides made their stand where their conscience had them make their stand.

This is what really got heads exploding. Deep thinkers like Rep. Ted Lieu (D-CA), Jake Tapper (you know, the ex-VH1 reporter who made his bones by doing snarky, superficial, and rather sleazy programs on, say, the legal battles over the Lynyrd Skynyrd legacy), and Ta-Nehiesi Coates inveighed against Kelly for daring even to suggest this.

In fact, Kelly’s remark is correct, as a matter of logic and of history.

Insofar as logic is concerned, a necessary condition for conflict is the failure to reach agreement–compromise. Those who make a deal aren’t fighting.

Insofar as history is concerned, sectional conflict was avoided throughout the 19th century through arduously negotiated compromises. The Missouri Compromise (1820), the Compromise Tariff (1833), the Compromise of 1850, the Kansas-Nebraska Act. Sectional compromise was the leitmotif of mid-19th century American political history: the Civil War was the exception to that rule, the time when compromise failed.

Abraham Lincoln’s political idol–Henry Clay–was known as “the Great Compromiser” for his work in negotiating the first three of these. But Clay was dead in 1860, as was another major figure in negotiating deals, Daniel Webster. Moreover, the political balance had changed, and the pernicious effects of Kansas-Nebraska made compromise even more difficult.

But nonetheless compromises were attempted. The Crittenden Compromise, introduced to Congress in December, 1860, was the most notable of these. It was satisfactory to southerners, but not to northerners, so it died aborning. (One of Crittenden’s sons became a Union general, another a Confederate general. The latter died in battle in 1861.)

Yet even in March 1861, Lincoln was making conciliatory gestures to the South in an attempt to achieve compromise. Lincoln ran explicitly denying any intent to interfere with slavery where it existed (a position he also took during the debates with Douglas), and conceded fundamental states rights principles to the South in his inaugural address:

have no purpose, directly or indirectly, to interfere with the institution of slavery in the States where it exists. I believe I have no lawful right to do so, and I have no inclination to do so.

Those who nominated and elected me did so with full knowledge that I had made this and many similar declarations and had never recanted them; and more than this, they placed in the platform for my acceptance, and as a law to themselves and to me, the clear and emphatic resolution which I now read:

Resolved, That the maintenance inviolate of the rights of the States, and especially the right of each State to order and control its own domestic institutions according to its own judgment exclusively, is essential to that balance of power on which the perfection and endurance of our political fabric depend; and we denounce the lawless invasion by armed force of the soil of any State or Territory, no matter what pretext, as among the gravest of crimes.

Note well this sentence: “we denounce the lawless invasion by armed force of the soil of any State or Territory, no matter what pretext, as among the gravest of crimes.” Lee would have agreed: he viewed the prospect of an invasion of Virginia by the government of the US to be a lawless act, and it is on that issue of lawlessness which he and Lincoln disagreed.

Lincoln went so far as to accept what was an anathema to abolitionists–the Fugitive Slave Act–arguing that the controversy was a matter of details (“a merely unsubstantial controversy as to how it should be kept”), not Constitutional principle:

It is scarcely questioned that this provision was intended by those who made it for the reclaiming of what we call fugitive slaves; and the intention of the lawgiver is the law. All members of Congress swear their support to the whole Constitution–to this provision as much as to any other. To the proposition, then, that slaves whose cases come within the terms of this clause “shall be delivered up” their oaths are unanimous. Now, if they would make the effort in good temper, could they not with nearly equal unanimity frame and pass a law by means of which to keep good that unanimous oath?

There is some difference of opinion whether this clause should be enforced by national or by State authority, but surely that difference is not a very material one. If the slave is to be surrendered, it can be of but little consequence to him or to others by which authority it is done. And should anyone in any case be content that his oath shall go unkept on a merely unsubstantial controversy as to how it shall be kept?

In other words, even Lincoln was perfectly willing to reach a compromise that preserved slavery where it existed, and which allowed Southerners to retrieve escaped slaves from anywhere in the US.

The basis for compromise on the lines of those thrashed out 1820-1854 existed, and many on both sides strove to realize it. But the Fire Eaters in the South in particular rejected it. So it is historical fact that the war came because the politicians of 1860-1861 failed to reach compromises like those their predecessors had accomplished a few decades before, despite attempts to do so.  There is a very solid historical basis for what Kelly said.

Now of course any such compromise would have perpetuated slavery. But this is something that Northerners were overwhelmingly willing to accept. And here is the irony. By rejecting the compromises that the North (and the Republicans specifically) would have been willing to offer that would have extended slavery, the Southern radicals embarked on a course that resulted in its destruction within a handful of years. They turned the would-be successor to the Great Compromiser into the Great Emancipator.

The morals of sectional compromise are also not nearly as clearcut as the Ta-Nahiesi Coateses of the world would have it. Yes, Lincoln would have willingly been complicit in the perpetuation of a great evil–something that he recognized as a great evil. But by rejecting Southern terms, and insisting on Union, Lincoln unleashed a war that resulted in the deaths of ~2.5 percent of the US population–and about 20 percent of the military age male population in the South. As Lincoln said in his Second Inaugural, “every drop of blood drawn by the lash was paid by another drawn by the sword.” War is a great evil too. You may prefer one evil to another, but you have to acknowledge that it is indeed a choice between great evils.

This raises another issue that I will write about in the future. It is relatively straightforward to understand why the South seceded, and to recognize that at root it left over slavery. It is harder to understand why the North fought to keep them in the Union. It most certainly was NOT to eradicate slavery: even by 1863, emancipation did not have majority support in the North, and the 13th Amendment was passed in 1865 only by the slimmest of margins, and with the help of some very swampy political dealings.

So why? I have some conjectures–largely unsatisfying–that I’ll share in the future. Suffice it to say it is far too neglected a subject, especially in contrast to the  vast amount of ink spilled over explaining secession.

In sum, for all of the freaking out that Kelly’s remarks induced, he has a far firmer grasp on historical truths than those freaking out do.

But he had to know that what he said would spark a backlash. Yet he went ahead. This is actually quite fascinating, and revealing. He did so after the left attempted to shut him up and shout him down for going after the execrable Florida representative over the Trump phone call to the widow of a soldier killed in Niger. By speaking up on such a controversial topic so soon afterwards Kelly is making it very clear that he will NOT be intimidated.

Further, it demonstrates on matters of substance that Kelly’s beliefs track Trump’s very closely–or should I say that Kelly’s sincere beliefs track positions that Trump has staked out? Further proof that anyone thinking that the temperamental difference between Trump and his chief of staff reflects differences in political positions is sadly deluded. Indeed, Kelly’s gravitas (isn’t it funny that word is usually reserved for Democrats, even those who don’t really have it?)  will make Trump far more effective. Kelly is an effective spokesman, and an unapologetic one.

Semper Fi. That makes him a very formidable foe for the left.He is not afraid of a fight, and knows how to win one.

 

 

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October 30, 2017

Michael Weiss: Stupid or Dishonest? I’m Going With “Both!”

Filed under: Politics,Russia — The Professor @ 7:18 pm

The usual suspects spent the weekend wetting themselves over the news of an impending Mueller indictment. This morning the eagerly anticipated event happened: Mueller indicted Paul Manafort and a heretofore nobody–Manafort’s former business associate Rick Gates.

BFD. The indictments had nothing to do with Trump, Trump’s campaign, or Trump collusion with the Russians. It involved Manafort’s concealment of his dealings with the Ukrainians (the ousted pro-Russia Yanukovych regime) and moneys associated therewith.

As Andrew McCarthy notes, the indictment seems shaky and overcharged, and a boon to Trump because it is an implicit validation of his assertion of no collusion. He further claims that the indictment is an attempt to pressure Manafort into cooperating.

Well, if that were the intent, it is likely that Mueller failed. Usually such cooperation would be negotiated in advance of an actual indictment, and the cooperator would then plead guilty to a reduced charge: that’s the negotiated quid pro quo. Here, it looks as if Mueller threw everything he had (which isn’t much) against Manafort, and then Manafort pled not guilty–hardly the actions of a cooperating witness.

As an aside, my friend, Houston attorney Tom Kirkendall, the most dogged follower of the Enron prosecutions, has told me that shaky overcharging in order to coerce witnesses is the MO of Mueller assistant Andrew Weissman, who was in charge of the Enron cases. Weissman is truly a piece of work, as detailed in this Rowan Scarborough article.

It is particularly interesting–and appalling–to note that Weissman was head of the DOJ Fraud Section that allowed a Russian the FBI (under Mueller’s and Comey’s directorships) had implicated in a vast bribery scheme connected to the Uranium One deal–including donations to the Clinton Foundation–to plead to a trivial charge (likely in violation of DOJ charging guidelines) with virtually no publicity. Quite a contrast, eh? Quite revealing that the one time where Weissman went against his normal MO resulted in the burying of a case that was highly damaging to the Clintons.

The most damning thing the Manafort indictment indicates is that Trump showed very bad judgment, and a serious lack of due diligence, in hiring Manafort. Another example of Trump’s injudicious choice of associates is one George Papadopolous, a Trump campaign advisor who pled guilty to lying to investigators. Throw in Carter Page, and it is clear that Trump’s campaign was so desperate to attract people that it scraped the bottom of the barrel and didn’t look too closely at what it dredged up. Trump is paying now for that carelessness.

The Papadopolous plea does provide some comic relief, however, for CNN’s Michael Weiss attempts to leverage it into evidence of Trump collusion with Russia. As with most Weiss efforts, it is a laughable failure, making up in gruesome wordiness for what it lacks in substance (or logic, for that matter).

Where to begin?

Well, let’s start with the biggest howler–a classic bait-and-switch. One wonders if Weiss is too stupid to recognize the fundamental logical defects in his argument, or thinks we are so stupid that we’ll miss it:

But “[o]n or about” April 26, 2016, Papadopoulous again met with the Professor in a London hotel. The complaint reads that the Professor told him he had “just returned from a trip to Moscow where he had met with high-level Russian government officials” where he learned that the Russians “have dirt” on Hillary Clinton; “the Russians had emails of Clinton” — “they have thousands of emails.”

This date is important because The Washington Post only first reported on June 14, 2016, that the hackers working for the Kremlin had penetrated the servers of the Democratic National Committee. And while this correspondence, first published by WikiLeaks in late July, days before the Democratic National Convention, was distinct from Clinton’s personal emails and those she turned over to the FBI as part of the investigation into her use of a personal server to conduct government business while she was secretary of state, it nonetheless caused a scandal within the Democratic Party.

Did you see what he did there? The first quoted paragraph refers to “thousands of emails [of Clinton]” the Russians claimed to have in April. The second paragraph refers to Democratic National Committee emails, the leaking of which was reported almost two months later. Two very different things. Very different. The emails the alleged interlocutor for the Russians mentioned are NOT the emails that subsequently appeared on Wikileaks, meaning that Weiss is either to stupid to know the difference, or so dishonest that he is trying to obscure the difference in order to make a hit on Trump.

It’s trivially easy to see what was going on here. Everybody and his 5th cousin knew about Hillary’s secret server by April, 2016, and there was widespread speculation that the Russians (and the Chinese, and the Iranians, and your Aunt Fanny) had hacked it. The Russians were clearly trying to entice the Trump campaign by dangling the bait of Hillary emails.

This pretty much blows the collusion narrative to smithereens, eh? If Trump (or his campaign) was colluding with the Russians, why would as late as April the Russians have to use an intermediary to attract  Trump’s attention by claiming to have the widely-speculated about Hillary emails?

Obviously: they wouldn’t.

This is a piece with the Trump Tower meeting, where a Russian intermediary again attempted to attract Trump’s attention by claiming to have dirt on Hillary. Again, if the Russians were already providing information to Trump, that would have been completely unnecessary.

Note that the Weiss article makes it plain that the alleged Russian-connected source (who was not Russian, but presumably a Greek or maybe a Cypriot, and who mainly asserted tight connections) was willing to tell whoppers to convince Papadopolous of her ability to deliver the goods: she introduced Papadopolous to a Russian national who claimed to be Putin’s niece. Hilarious. Did she also claim to have connections with Marie of Roumania?

So, according to Weiss, the Russians told outrageous lies, but Papadopolous–and the Trump camp–were supposed to know that the claims regarding Hillary emails were gospel. Gospel I tells ya!

OK. Sure.

But the hilarity has just begun! Note that if the Russians were referring to Hillary emails, if Weiss believes the Russians were telling the truth (as his story requires) that would be an admission that Hillary’s server had indeed been hacked. Andy Kaufmann lookalike Rep. Adam Schiff (D-CA, who is more absurd than Andy ever was) has made a similar implicit admission.

I really think they are too stupid to have figured that out. LOL.

But there’s more! (Isn’t there always?) The Trump campaign spurned the Papadopolous offer. But it’s even better than that: the alleged mastermind of the Russo-Trump collusive scheme–Manafort himself–is the one who told Papadopolous to pound sand:

In the event, no meeting ever took place. CNN reported in August 2017 that it was in fact Paul Manafort who “immediately dismissed the idea of meeting with top Russian officials and advised Trump to do the same.”

Manafort “[i]mmediately dismissed.” Self-satirizing.

The cherry on top of this comic sundae is this:

Gibbs is quite right to stress in his affidavit that using “nongovernmental intermediaries,” such as academics and think tankers, is one way Russian intelligence advances the Kremlin’s interests overseas. And there’s recent precedence for this in London, as I’ve documented elsewhere.

Uhm, Mike–the US does that too. And I would add journalists to that list: no conjecture there, as this is a widely documented fact. Further, I am highly confident that you fall into the category of U.S. “nongovernmental intermediary” as both a think tanker and a journalist. Heck, maybe this pathetic excuse of an article is just another example of that.

I could go on, but eviscerating this piece (of what, I’ll leave to your imagination) is far too easy. I need a much bigger challenge. So should I shoot fish in a barrel or steal candy from babies?

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October 26, 2017

John Kelly is From Mars: The New York Times is From Planet Clueless

Filed under: Military,Politics — The Professor @ 7:55 pm

It’s quite amusing to observe the dismay and panic expressed in this NYT article about Trump’s Chief of Staff, John Kelly. OH MY GOD. HE ACTUALLY BELIEVES IN TRUMP’S AGENDA! WE THOUGHT HE WAS GOING TO TAME THE BEAST! WE’RE DOOMED! DOOMED I SAY!

For all of the talk of Mr. Kelly as a moderating force and the so-called grown-up in the room, it turns out that he harbors strong feelings on patriotism, national security and immigration that mirror the hard-line views of his outspoken boss. With his attack on a congresswoman who had criticized Mr. Trump’s condolence call to a slain soldier’s widow last week, Mr. Kelly showed that he was willing to escalate a politically distracting, racially charged public fight even with false assertions.

And in lamenting that the country no longer holds women, religion, military families or the dignity of life “sacred” the way it once did, Mr. Kelly, a retired four-star Marine general whose son was killed in Afghanistan, waded deep into the culture wars in a way few chiefs of staff typically do. Conservatives cheered his defense of what they consider traditional American values, while liberals condemned what they deemed an outdated view of a modern, pluralistic society.

A Marine who “harbors strong feelings on patriotism.” Who could ever conceive of such a thing? And interesting choice of words, isn’t it? “Harbor” is often used to suggest something illicit, like harboring a fugitive, or to insinuate concealment. No, I would imagine that Kelly wears his patriotism on his sleeve.

And again, what does one expect from a career Marine who achieved four star rank? Yes, there are exceptions–cf. Smedley Butler–but high ranking Marines do tend to be conventionally patriotic, and in the right tail of the patriotism distribution.

And a Marine who takes national security seriously. Again–who knew?

Insofar as immigration is concerned, this should not be surprising either, for two reasons. First, as the transnational progressives/globalists at the NYT never cease telling us, there is a strong correlation between American nationalist beliefs (which, I must note, are different in key ways from the European nationalism which the likes of the NYT and its readership wrongheadedly confuse it with) and hostility to open borders. Second, is it any surprise that Trump chose someone who was in agreement with him on immigration to head DHS, which is responsible for immigration policy?

This article is self-satirizing. Which makes thing easy for me. I just have to point you to it, and you can take the laughs from there.

The Times and others (including house broken “conservatives” like Jennifer Rubin at the WaPo, who cites Kelly as a reason there should be no generals in the White House) somehow think that because the steely, disciplined, controlled Kelly is temperamentally different from the mercurial and indisciplined Trump that he must be ideologically different as well.

What idiocy! I would in fact think it highly likely that Kelly is more innately and consistently committed to MAGA and a MAGA agenda than Trump: Trump has been all over the ideological map in the last nearly 40 years, and there is a lingering suspicion that his new identity as American nationalist champion is little more than a cannily chosen political strategy, rather than a matter of conviction.

In contrast, there is little doubt that Kelly is a man of conviction, and the irony–which is driving the NYT into apoplexy, and which is probably enriching many therapists on the Upper West Side (who are probably themselves getting therapy)–is that it is eminently possible that Kelly will get Trump to internalize those convictions, and moreover, attempt to achieve them in a more disciplined, strategic, and steady way.

In other words, NYT: be very, very careful what you ask for. You just might get it.

One last thing. The very article that frets neurotically about Kelly’s pointed remarks about how few Americans serve in uniform (he calls those that do “the one percent”) and how little those who don’t serve know about those who do provides proof of the ignorance that Kelly criticizes. For catch this:

Correction: October 27, 2017 

An article on Thursday about the White House chief of staff, John F. Kelly, misidentified the branch of the armed forces in which his son, who was killed in combat, served. He was a Marine, not a soldier.

Anyone with passing familiarity with the US military would know that members of the United States Marine Corps are not “soldiers,” and indeed, bridle at the term: they are Marines, dammit. There was a time (and there may still be occasions) where making that mistake could get you a black eye and a bloody nose. The NYT (including the writer, fact checkers, editors) obviously does not even have passing familiarity with the US military, which is why they  find someone like Kelly utterly unfathomable.

John Kelly is from Mars: the New York Times is from the Planet Clueless.

 

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October 24, 2017

Maybe the Clinton Campaign Should Have Used a Staten Island Hosting Service Instead

Filed under: Politics,Russia — The Professor @ 8:48 pm

Today’s breathless “EXCLUSIVE” about Russia’s nefarious plots in the US is from the Daily Beast. In a nutshell, the crafty Russkies used a web hosting service in Staten Island to spread their fake news and propaganda on BLM and other issues.

The shambolic nature of the effort chronicled in the DB (appropriate acronym!) is laughable when compared to the massively expensive digital efforts of the Clinton and Trump campaigns. Here is a long Politico tongue bath slobbering all over the Clinton operation. And Clinton also had the benefit of the efforts of tech titan Eric Schmidt.

Here is a snarky Medium piece, which in the end grudgingly acknowledges the effectiveness of the Trump campaign.  Trump’s efforts specifically focused on Facebook, and at one point in the campaign he was spending $70 million a month on the digital portion of his campaign.

The sophistication and magnitude of the campaign efforts dwarfed anything the Russians did, Staten Island servers or no. Contrasted with the massive Republican and Democratic efforts to jam the airways and inter webs , the Russians’ activities were like a weak electromagnetic signal received from a distant star system. Background radiation at ground zero of a nuclear test.

Yet the hysterics focus on that, because in the end, it’s all they’ve got. It’s hard to know what is more laughable: the story itself, or the fact that anyone takes it seriously. But “journalists” like Miriam Elder at Buzzfeed (deeply implicated in the dissemination of the Steele dossier, an act Mikhail Fridman et al may well soon cause her to regret to the end of her days) cackle in glee at it. They actually think it is significant, a smoking gun. Amazing.

For those needing a schadenfreude booster, I strongly suggest the Politico article, released two months and a day before the election. But be careful! It could lead to a schadenfreude overdose, for virtually every paragraph contains a statement which in retrospect is  a howler that makes the Clinton campaign look very, very bad:

What cities Clinton campaigns in and what states she competes in, when she emails supporters and how those emails are crafted, what doors volunteers knock on and what phone numbers they dial, who gets Facebook ads and who gets printed mailers — all those and more have Kriegel’s coding fingerprints on them.

To understand Kriegel’s role is to understand how Clinton has run her campaign — precise and efficient, meticulous and effective, and, yes, at times more mathematical than inspirational. Top Clinton advisers say almost no major decision is made in Brooklyn without first consulting Kriegel.

So why hasn’t Hillary blamed him yet?

Now, with Donald Trump investing virtually nothing in data analytics during the primary and little since, Kriegel’s work isn’t just powering Clinton’s campaign, it is providing her a crucial tactical advantage in the campaign’s final stretch. It’s one of the reasons her team is confident that, even if the race tightens as November approaches, they hold a distinctive edge. As millions of phone calls are made, doors knocked and ads aired in the next nine weeks, it is far likelier the Democratic voter contacts will reach the best and most receptive audiences than the Republican ones.

“Donald Trump investing virtually nothing in data analytics.” Hahahahaha. Famous last words! It’s just that the Trump people were smart enough to keep their massive effort (which was disproportionately digital and largely eschewed the massive TV ad buys that the more conventional campaign lavished money on–3 times as much as Trump, in fact) under wraps, while the narcissists in the Clinton campaign chose to preen and brag about their superiority.

Karma is a bitch.

But as they say, there’s more!

Some Republicans aren’t just nervous about losing to Clinton in November. They’re alarmed at the possibility of falling multiple cycles, even a generation, behind in creating a culture of data-intensive campaigns. Romney hardly had an autonomous analytics department. Trump has called data “overrated.” Kriegel, meanwhile, is incubating the next generation of Democratic talent — his team rivaled the size of Trump’s entire headquarters operation for much of the primary — the no-name analysts of 2016 who will emerge as the key players in 2018 and 2020.

Think of all that wasted money. Small is beautiful!

And more!

One Democratic strategist, an Obama veteran with knowledge of the Clinton campaign, marveled at Kriegel’s sway in Brooklyn. “I have never seen a campaign that’s more driven by the analytics,” the strategist said. It’s not as if Kriegel’s data has ever turned around Clinton’s campaign plane; it’s that her plane almost never takes off without Kriegel’s data charting its path in the first place.

Apparently Kriegel’s data did not include exotic places like “Wisconsin.”

And I guess Wisconsin, Michigan, and Pennsylvania weren’t battleground states, ‘cuz otherwise they would have consulted The Amazing Kriegel:

Four years ago, Kriegel similarly won the trust of Obama’s top brass as the battleground states analytics director in The Cave, the much-heralded Obama 2012 data war room. “We didn’t make a single decision about battleground state strategy without first talking to Elan about his numbers,” said Jeremy Bird, then Obama’s national field director and now a Clinton consultant.

Har!:

As Trump has stumped in far-afield states like Mississippi, Washington and Texas, Republicans have implored his team to incorporate some data inputs to something as fundamental as the candidate’s schedule.

So tell me again who had the idiotic schedule?

I can’t stop laughing. The Democrats just KNEW that all tech-y, science-y, big data types were progressives and the Trump people were knuckle dragging idiots licking stamps to fix to mailers printed on a mimeograph machine. But in reality, the Trump people beat them at their own game. Or maybe not. Note that in the Politico article a main focus of the Kriegel analysis was deciding where to place TV ads, whereas the Trump campaign figured out that targeted Facebook appeals would be much more effective. In other words, the Clinton campaign grafted new analytic methods on top of old school media, while the Trump people focused on new media. Clinton played the old game in new ways, and Trump played a new game. Yet the Clinton people–and their media acolytes–were so busy with bragging about their own superiority that they never knew what hit them. Maybe they should have hired Sergey Kashyrin and some Russian trolls instead. It would have been a lot cheaper, in any event!

These different but related stories are a testament to the absurdity of American politics at present. The attention lavished on the Staten Island server specifically, and the fringe Russian propaganda effort generally, shows how unhinged the losers of the 2016 election have become in their desperation to find an explanation and an excuse for their defeat, and a way to try to undo the result of that election. The Politico story reveals unintentionally the real reason for that loss: a smug, self-satisfied elite operating in a bubble, thinking it knew everything worth knowing, and all the while completely oblivious to a seismic political movement that was largely a reaction to them.

 

 

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October 22, 2017

Cranking the Russian Absurdity to 11: Logical Consistency Need Not Apply

Filed under: Politics,Russia,Uncategorized — The Professor @ 4:37 pm

The absurdity of the Russia collusion investigation knows no bounds. The most recent iteration is that a Russian troll farm placed Facebook ads that promoted political division in the US. A far cry that from Trump personally canoodling with Putin, but put that aside. Front and center among the most recent allegations is that said troll farm placed material advancing Black Lives Matters themes with the intent of stoking racial division.

Members of the Congressional Black Caucus are extremely critical of Facebook for failing to derail the ads:

“This is a very fragile moment in time for African-Americans across this country,” Rep. Cedric Richmond (D-La.), chairman of the CBC, told reporters. “What we needed Facebook to understand is that they play a role in the perception of African-Americans, and they are influencers that use their platform to influence this country.”

. . . .

CBC lawmakers said they think the Russian ads promoting Black Lives Matter would have been easily flagged, and likely not seen by as many as 10 million people, had Facebook employed more people of color. Sandberg committed to adding a person of color to the board of directors soon, Richmond told reporters.

Several comments about this.

First, far be it from me to defend Facebook, but can you imagine the hue and cry had Facebook blocked similar–or even identical–content from any BLM-affiliated or sympathetic group or individual? The CBC would have been first in line to scream censorship. And does anyone believe that “people of color” at FB would have been more likely to flag and suppress pro-BLM messages? In what universe? Thus, this chin pulling is a case of ad hominem argument: it is not the content that they find objectionable, but who placed the content and for what purpose. (I doubt that the foreign origin of the material matters either: I imagine that the same people would be quite comfortable with similar messages being spread by ideological allies from say, Venezuela or Cuba. The alleged Russian origin only looks problematic in hindsight in the aftermath of the election.)

Second, the Obama administration was very sympathetic to the BLM agenda. Obama hosted BLM leader DeRay McKesson at the White House. I daresay he met privately with DeRay and other BLM leaders more than he met with some cabinet secretaries. Even more outspoken than the president was his Attorney General, Eric Holder. Holder traveled to Ferguson, Missouri at the height of the turmoil there and made remarks that hewed very closely to the BLM line–that was pretty damned divisive.  He gave speeches praising BLM.  BLM played a prominent role at the Democratic convention in 2016, and Holder said “black lives matter” during his speech there.

Again, if such BLM-themed remarks are racially divisive when made in Facebook ads placed by Russians (allegedly) and seen by a relatively small number of people, aren’t they much more so if expressed repeatedly by the president and the country’s chief law enforcement official at a time this issue was very raw, and receiving wall-to-wall coverage in all forms of media? Is BLM-themed rhetoric dangerous per se or not? If it is, that is true regardless of who says it.

And if advancing BLM-related themes is inherently bad, why are the same people criticizing the Facebook ads (and Facebook) the most outspoken defenders of kneeling NFL players, and the most vocal critics of a president who criticizes those players?

The logical fallacies and logical contradictions are rampant.

Third, assuming the allegations re Russia are correct, and indeed, assuming that this was part of a political influence operation run by Russian intelligence, it is nothing new! The Russians/Soviets have done this for years and years and years. The medium–social media–is new, but the methodology is tried-and-true: the Soviets/Russians have always used available media as part of these operations, so it should be no surprise that they have turned to social media given its current dominance. Further, the Russians/Soviets have focused on sowing racial division in particular during periods of racial strife in the US (e.g., the disinformation campaign claiming that AIDS was a CIA plot to kill black people). It is only the historical idiocy of the American establishment/political class that leads them to find something novel and uniquely dangerous in this new iteration of a very old game.

Indeed, when I argued years ago that ZeroHedge was a Russian influence operation it was precisely because it exhibited tells and used methodologies that I became aware of during the height of the Cold War. I noted specifically the seeding of pro-Occupy stories and themes in ZeroHedge as an indication that it was an influence operation. Replace Occupy with BLM and ZH with FB, and the analogy is exact. Again, anyone who thinks this is something new and a unique threat to the Republic is an historical idiot.

Indeed, look at the similarities with what is alleged about the social media strategy and ZeroHedge. ZH has long run very contradictory messages. Yes, there were many Occupy-themed posts. But there were also many Ron Paul-liberatarian posts, and anti-Obama administration posts. The common theme was that the posts addressed controversial issues in inflammatory ways. There was no common ideological line: they pushed everybody’s buttons. This is exactly what is alleged in the Facebook-Russia story.

This hysteria over this recent–and rather mild, by historical standards–iteration on this methodology wreaks of desperation to rationalize a devastating political loss, and an intent to delegitimize the winner of that election.

The triviality and triteness of this alleged conduct is all the more evident when one considers another story–one which the media is doing its damndest to ignore. The Hill–hardly a fellow traveler of Breitbart–has run several stories detailing the myriad links (including specifically financial links) between the Clintons and Russia, which were contemporaneous with the decision by the US government to approve the sale of Uranium One (which owned 20 percent of US uranium production) to Russia. Further, The Hill reports that the FBI had engaged in a thorough investigation of corruption surrounding the deal, which ultimately resulted in an indictment and conviction of one of the Russian principals–something which the FBI and DOJ announced with virtually no fanfare. Further, the plea covered a fraction of the criminal conduct that had been uncovered, greatly undercharged the offense, and was delayed until after it could have scotched the Uranium One deal.  Congress and the government body that must approve foreign takeovers over national security-sensitive companies were kept in the dark about the massive bribery scheme. The US informant has been gagged and threatened with criminal prosecution if he talks to Congress.

The Clinton Foundation was at the center of a nexus of connections between the corrupt parties to the transaction. The fact that many of the main actors in the Trump-Russia imbroglio–Hillary, Mueller, Comey, Rosenstein, and McCabe–were also deeply involved in the events reported by The Hill makes it all too much, really.

Today the Daily Caller–yes, closer to Breitbart than The Hill–notes the potential connection with the Russian spy ring story of 2010.

I’m not going to try to parse these stories–it is not necessary to do so for my present purpose here. Suffice it to say that the connections reported by The Hill–which, in turn, were allegedly uncovered as part of an FBI investigation that resulted in a conviction–are far more substantial and better documented than any of those that involving Trump, despite the assiduous efforts of legions of journalists and investigators to find the latter. What’s more, The Hill allegations involve Hillary Clinton’s actions while she held the most senior post in the president’s cabinet, and the concealment of the details from Congress and the American public required the complicity of Holder and Obama, as well as the FBI. All of which means that if the more flimsy allegations against Trump warrant a special counsel and numerous Congressional inquiries, those against Clinton (and the Obama administration) deserve at least as much, if not more.

Again–is a little logical consistency too much to ask for? That was a rhetorical question, folks.

The upshot of all of this is that the frenzy regarding Russia right now has little, if any, relationship to its substantive importance. The new social media-related allegations are ad hominem in nature: if advancing a BLM narrative is racially divisive, and that is inherently bad, Russian troll farms are the least important offenders. Obama, Holder, and Colin Kaepernick are far more culpable. Further, the alleged conduct is par for the Russian course, and indeed, is exactly the kind of activity that I pointed out in 2009–and which was well known decades before that. Lastly, the Democratic hysteria over Russia has to be the greatest case of projection in political history, when one considers the myriad Clinton-Russia connections.

This cranking of the Russia absurdity to 11 has nothing to do with facts or realities or even logical consistency. In fact, I should say especially logical consistency. The grotesque inconsistencies demonstrate instead that it has everything to do with a peculiarly American disinformation campaign intended to overturn the results of an election, and to kneecap the victor thereof.

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October 17, 2017

Dead Penguins Don’t Matter If They Don’t Advance a Political Point

Filed under: Climate Change,Politics — The Professor @ 7:25 pm

What, you didn’t hear/read the story about the “massive breeding failure” among Adélie penguins, in which only two–yes two–offspring of 18,000 breeding pairs survived? Well, there’s a reason for that.

You can guarantee that you would have heard about it 24/7 had it been even remotely plausible to pin this catastrophe on anthropogenic global warming. Algore, every A through Z list celebrity (looking for an opportunity to distract from Harvey Weinstein’s shrubbery), every politician from Australia to Zimbabwe would have been on about it incessantly, at high volume, and in the highest dudgeon.

But the die-off was due to–wait for it–excessive sea ice which greatly increased the distance that the adults had to go to get food. So because they died for the wrong reason–and indeed, died for a highly inconvenient reason (or would that be truth?)–the story made barely a ripple. Move along, nothing to see.

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October 12, 2017

Trump Treasury Channels SWP

SWP doesn’t work for the Trump Treasury Department, and is in fact neuralgic to the idea of working for any government agency. Yet the Treasury’s recent report on financial regulatory reform is very congenial to my thinking, on derivatives related issues anyways. (I haven’t delved into the other portions.)

A few of the greatest hits.

Position limits. The Report expresses skepticism about the existence of “excessive speculation.” Therefore, it recommends limiting the role of position limits to reducing manipulation during the delivery period. Along those lines, it recommends spot month on limits, because that is “where the risk of manipulation is greatest.” It also says that limits should be designed so as to not burden unduly hedgers. I made both of these points in my 2011 comment letter on position limits, and in the paper submitted in conjunction with ISDA’s comment letter in 2014. They are also reflected in the report on the deliberations of the Energy and Environmental Markets Advisory Committee that I penned (to accurately represent the consensus of the Committee) in 2016–much to Lizzie Warren’s chagrin.

The one problematic recommendation is that spot month position limits be based on “holistic” definitions of deliverable supply–e.g., the world gold market. This could have extremely mischievous effects in manipulation litigation: such expansive and economically illogical notions of deliverable supplies in CFTC decisions like Cox & Frey make it difficult to prosecute corners and squeezes.

CFTC-SEC Merger. I have ridiculed this idea for literally decades–starting when I was yet but a babe in arms 😉 It is a hardy perennial in DC, which I have called a solution in search of a problem. (I think I used the same language in regards to position limits–this is apparently a common thing in DC.) The Treasury thinks little of the idea either, and recommends against it.

SEFs. I called the SEF mandate “the worst of Frankendodd” immediately upon the passage of the law in July, 2010. The Treasury Report identifies many of the flaws I did, and recommends a much less restrictive requirement than GiGi imposed in the CFTC SEF rules. I also called out the Made Available For Trade rule the dumbest part of the worst of Frankendodd, and Treasury recommends eliminating these flaws as well. Finally, four years ago I blogged about the insanity of the dueling footnotes, and Treasury recommends “clarifying or eliminating” footnote 88, which threatened to greatly expand the scope of the SEF mandate.

CCPs. Although it does not address the main concern I have about the clearing mandate, Treasury does note that many issues regarding systemic risks relating to CCPs remain unresolved. I’ve been on about this since before DFA was passed, warning that the supposed solution to systemic risk originating in derivatives markets created its own risks.

Uncleared swap margin. I’ve written that uncleared swap margin rules were too rigid and posed risks. I have specifically written about the 10-day margining period rule as being too crude and poorly calibrated to risk: Treasury agrees. Similarly, it argues for easing affiliate margin rules, reducing the rigidity of the timing of margin payments (which will ease liquidity burdens), and overbroad application of the rule to include entities that do not impose systemic risks.

De minimis threshold for swap dealers. I’m on the record for saying using a notional amount to determine the de minimis threshold to determine who must register as a swap dealer made no sense, given the wide variation in riskiness of different swaps of the same notional value. I also am on the record that the $8 billion threshold sweeps in firms that do not pose systemic risks, and that a reduced threshold of $3 billion would be even more ridiculously over inclusive. Treasury largely agrees.

The impact of capital rules on clearing. One concern I’ve raised is that various capital rules, in particular those that include initial margin amounts in determining liquidity ratios for banks, and hence their capital requirements, make no economic sense, and and unnecessarily drive up the costs banks/FCMs incur to clear for clients. This is contrary to the purpose of clearing mandates, and moreover, has contributed to increased concentration among FCMs, which is in itself a systemic risk. Treasury recommends “the deduction of initial margin for centrally cleared derivatives from the SLR denominator.” Hear, hear.

I could go into more detail, but these are the biggies. All of these recommendations are very sensible, and with the one exception noted above, in the Title VII-related section I see no non-sensical recommendations. This is actually a very thoughtful piece of work that if followed, will  undo some of the most gratuitously burdensome parts of Frankendodd, and the Gensler CFTC’s embodiment (or attempts to embody) those parts in rules.

But, of course, on the Lizzie Warren left and in the chin pulling mainstream media, the report is viewed as a call to gut essential regulations. Gutting stupid is actually a good idea, and that’s what this report proposes. Alas, Lizzie et al are incapable of even conceiving that regulations could possibly be stupid.

Hamstrung by inane Russia investigations and a recalcitrant (and largely gutless and incompetent) Republican House and Senate, the Trump administration has accomplished basically zero on the legislative front. It’s only real achievement so far is to start–and just to start–the rationalization and in some cases termination (with extreme prejudice) of Obama-era regulation. If implemented, the recommendations in the Treasury Report (at least insofar as Title VII of DFA is concerned), would represent a real achievement. (As would rollbacks or elimination of the Clean Power Plan, Net Neutrality, and other 2009-2016 inanity.)

But of course this will require painstaking efforts by regulatory agencies, and will have to be accomplished in the face of an unrelentingly hostile media and the lawfare efforts of the regulatory class. But at least the administration has laid out a cogent plan of action, and is getting people in place who are dedicated to put that plan into action (e.g., Chris Giancarlo at CFTC). So let’s get on with it.

 

 

 

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