The Evidence to Prove the Russian Hack

In this post, I’m going to lay out the evidence needed to fully explain the Russian hack. I think it will help to explain some of the timing around the story that the CIA believes Russia hacked the DNC to help win Trump win the election, as well as what is new in Friday’s story. I will do rolling updates on this and eventually turn it into a set of pages on Russia’s hacking.

As I see it, intelligence on all the following are necessary to substantiate some of the claims about Russia tampering in this year’s election.

  1. FSB-related hackers hacked the DNC
  2. GRU-related hackers hacked the DNC
  3. Russian state actors hacked John Podesta’s emails
  4. Russian state actors hacked related targets, including Colin Powell and some Republican sites
  5. Russian state actors hacked the RNC
  6. Russian state actors released information from DNC and DCCC via Guccifer 2
  7. Russian state actors released information via DC Leaks
  8. Russian state actors or someone acting on its behest passed information to Wikileaks
  9. The motive explaining why Wikileaks released the DNC and Podesta emails
  10. Russian state actors probed voter registration databases
  11. Russian state actors used bots and fake stories to make information more damaging and magnify its effects
  12. The level at which all Russian state actors’ actions were directed and approved
  13. The motive behind the actions of Russian state actors
  14. The degree to which Russia’s efforts were successful and/or primary in leading to Hillary’s defeat

I explain all of these in more detail below. For what it’s worth, I think there was strong publicly available information to prove 3, 4, 7, 11. I think there is weaker though still substantial information to support 2. It has always been the case that the evidence is weakest at point 6 and 8.

At a minimum, to blame Russia for tampering with the election, you need high degree of confidence that GRU hacked the DNC (item 2), and shared those documents via some means with Wikileaks (item 8). What is new about Friday’s story is that, after months of not knowing how the hacked documents got from Russian hackers to Wikileaks, CIA now appears to know that people close to the Russian government transferred the documents (item 8). In addition, CIA now appears confident that all this happened to help Trump win the presidency (item 13).

1) FSB-related hackers hacked the DNC

The original report from Crowdstrike on the DNC hack actually said two separate Russian-linked entities hacked the DNC: one tied to the FSB, which it calls “Cozy Bear” or APT 29, and one tied to GRU, which it calls “Fancy Bear” or APT 28. Crowdstrike says Cozy Bear was also responsible for hacks of unclassified networks at the White House, State Department, and US Joint Chiefs of Staff.

I’m not going to assess the strength of the FSB evidence here. As I’ll lay out, the necessary hack to attribute to the Russians is the GRU one, because that’s the one believed to be the source of the DNC and Podesta emails. The FSB one is important to keep in mind, as it suggests part of the Russian government may have been hacking US sites solely for intelligence collection, something our own intelligence agencies believe is firmly within acceptable norms of spying. In the months leading up to the 2012 election, for example, CIA and NSA hacked the messaging accounts of a bunch of Enrique Peña Nieto associates, pretty nearly the equivalent of the Podesta hack, though we don’t know what they did with that intelligence. The other reason to keep the FSB hack in mind is because, to the extent FSB hacked other sites, they also may be deemed part of normal spying.

2) GRU-related hackers hacked the DNC

As noted, Crowdstrike reported that GRU also hacked the DNC. As it explains, GRU does this by sending someone something that looks like an email password update, but which instead is a fake site designed to get someone to hand over their password. The reason this claim is strong is because people at the DNC say this happened to them.

Note that there are people who raise questions of whether this method is legitimately tied to GRU and/or that the method couldn’t be stolen and replicated. I will deal with those questions at length elsewhere. But for the purposes of this post, I will accept that this method is a clear sign of GRU involvement. There are also reports that deal with GRU hacking that note high confidence GRU hacked other entities, but less direct evidence they hacked the DNC.

Finally, there is the real possibility that other people hacked the DNC, in addition to FSB and GRU. That possibility is heightened because a DNC staffer was hacked via what may have been another method, and because DNC emails show a lot of password changes off services for which DNC staffers had had their accounts exposed in other hacks.

All of which is a way of saying, there is some confidence that DNC got hacked at least twice, with those two revealed efforts being done by hackers with ties to the Russian state.

3) Russian state actors (GRU) hacked John Podesta’s emails

Again, assuming that the fake Gmail phish is GRU’s handiwork, there is probably the best evidence that GRU hacked John Podesta and therefore that Russia, via some means, supplied Wikileaks, because we have a copy of the actual email used to hack him. The Smoking Gun has an accessible story describing how all this works. So in the case of Podesta, we know he got a malicious phish email, we know that someone clicked the link in the email, and we know that emails from precisely that time period were among the documents shared with Wikileaks. We just have no idea how they got there.

4) Russian state actors hacked related targets, including some other Democratic staffers, Colin Powell and some Republican sites

That same Gmail phish was used with victims — including at a minimum William Rinehart and Colin Powell — that got exposed in a site called DC Leaks. We can have the same high degree of confidence that GRU conducted this hack as we do with Podesta. As I note below, that’s more interesting for what it tells us about motive than anything else.

5) Russian state actors hacked the RNC

The allegation that Russia also hacked the RNC, but didn’t leak those documents — which the CIA seems to rely on in part to argue that Russia must have wanted to elect Trump — has been floating around for some time. I’ll return to what we know of this. RNC spox Sean Spicer is denying it, though so did Hillary’s people at one point deny that they had been hacked.

There are several points about this. First, hackers presumed to be GRU did hack and release emails from Colin Powell and an Republican-related server. The Powell emails (including some that weren’t picked up in the press), in particular, were detrimental to both candidates. The Republican ones were, like a great deal of the Democratic ones, utterly meaningless from a news standpoint.

So I don’t find this argument persuasive in its current form. But the details on it are still sketchy precisely because we don’t know about that hack.

6) Russian state actors released information from DNC and DCCC via Guccifer 2

Some entity going by the name Guccifer 2 started a website in the wake of the announcement that the DNC got hacked. The site is a crucial part of this assessment, both because it released DNC and DCCC documents directly (though sometimes misattributing what it was releasing) and because Guccifer 2 stated clearly that he had shared the DNC documents with Wikileaks. The claim has always been that Guccifer 2 was just a front for Russia — a way for them to adopt plausible deniability about the DNC hack.

That may be the case (and obvious falsehoods in Guccifer’s statements make it clear deception was part of the point), but there was always less conclusive (and sometimes downright contradictory) evidence to support this argument (this post summarizes what it claims are good arguments that Guccifer 2 was a front for Russia; on the most part I disagree and hope to return to it in the future). Moreover, this step has been one that past reporting said the FBI couldn’t confirm. Then there are other oddities about Guccifer’s behavior, such as his “appearance” at a security conference in London, or the way his own production seemed to fizzle as Wikileaks started releasing the Podesta emails. Those details of Guccifer’s behavior are, in my opinion, worth probing for a sense of how all this was orchestrated.

Yesterday’s story seems to suggest that the spooks have finally figured out this step, though we don’t have any idea what it entails.

7) Russian state actors released information via DC Leaks

Well before many people realized that DC Leaks existed, I suspected that it was a Russian operation. That’s because two of its main targets — SACEUR Philip Breedlove and George Soros — are targets Russia would obviously hit to retaliate for what it treats as a US-backed coup in Ukraine.

DC Leaks is also where the publicly released (and boring) GOP emails got released.

Perhaps most importantly, that’s where the Colin Powell emails got released (this post covers some of those stories). That’s significant because Powell’s emails were derogatory towards both candidates (though he ultimately endorsed Hillary).

It’s interesting for its haphazard targeting (if someone wants to pay me $$ I would do an assessment of all that’s there, because some just don’t make any clear sense from a Russian perspective, and some of the people most actively discussing the Russian hacks have clearly not even read all of it), but also because a number of the victims have been affirmatively tied to the GRU phishing methods.

So DC Leaks is where you get obvious Russian targets and Russian methods all packaged together. But of the documents it released, the Powell emails were the most interesting for electoral purposes, and they didn’t target Hillary as asymmetrically as the Wikileaks released documents did.

8) Russian state actors or someone acting on its behest passed information to Wikileaks

The basis for arguing that all these hacks were meant to affect the election is that they were released via Wikileaks. That is what was supposed to be new, beyond just spying (though we have almost certainly hacked documents and leaked them, most probably in the Syria Leaks case, but I suspect also in some others).

And as noted, how Wikileaks got two separate sets of emails has always been the big question. With the DNC emails, Guccifer 2 clearly said he had given them to WL, but the Guccifer 2 ties to Russia was relatively weak. And with the Podesta emails, I’m not aware of any known interim step between the GRU hack and Wikileaks.

A late July report said the FBI was still trying to determine how Russia got the emails to Wikileaks or even if they were the same emails.

The FBI is still investigating the DNC hack. The bureau is trying to determine whether the emails obtained by the Russians are the same ones that appeared on the website of the anti-secrecy group WikiLeaks on Friday, setting off a firestorm that roiled the party in the lead-up to the convention.

The FBI is also examining whether APT 28 or an affiliated group passed those emails to WikiLeaks, law enforcement sources said.

An even earlier report suggested that the IC wasn’t certain the files had been passed electronically.

And the joint DHS/ODNI statement largely attributed its confidence that Russia was involved in the the leaking (lumping Guccifer 2, DC Leaks, and Wikileaks all together) not because it had high confidence in that per se (a term of art saying, effectively, “we have seen the evidence”), but instead because leaking such files is consistent with what Russia has done elsewhere.

The recent disclosures of alleged hacked e-mails on sites like DCLeaks.com and WikiLeaks and by the Guccifer 2.0 online persona are consistent with the methods and motivations of Russian-directed efforts.

Importantly, that statement came out on October 7, so well after the September briefing at which CIA claimed to have further proof of all this.

Now, Julian Assange has repeatedly denied that Russia was his source. Craig Murray asserted, after having meeting with Assange, that the source is not the Russian state or a proxy. Wikileaks’ tweet in the wake of yesterday’s announcement — concluding that an inquiry directed at Russia in this election cycle is targeted at Wikileaks — suggests some doubt. Also, immediately after the election, Sergei Markov, in a statement deemed to be consistent with Putin’s views, suggested that “maybe we helped a bit with WikiLeaks,” even while denying Russia carried out the hacks.

That’s what’s new in yesterday’s story. It stated that “individuals with connections to the Russian government” handed the documents to Wikileaks.

Intelligence agencies have identified individuals with connections to the Russian government who provided WikiLeaks with thousands of hacked emails from the Democratic National Committee and others, including Hillary Clinton’s campaign chairman, according to U.S. officials. Those officials described the individuals as actors known to the intelligence community and part of a wider Russian operation to boost Trump and hurt Clinton’s chances.

[snip]

[I]ntelligence agencies do not have specific intelligence showing officials in the Kremlin “directing” the identified individuals to pass the Democratic emails to WikiLeaks, a second senior U.S. official said. Those actors, according to the official, were “one step” removed from the Russian government, rather than government employees. Moscow has in the past used middlemen to participate in sensitive intelligence operations so it has plausible deniability.

I suspect we’ll hear more leaked about these individuals in the coming days; obviously, the IC says it doesn’t have evidence of the Russian government ordering these people to share the documents with Wikileaks.

Nevertheless, the IC now has what it didn’t have in July: a clear idea of who gave Wikileaks the emails.

9) The motive explaining why Wikileaks released the DNC and Podesta emails

There has been a lot of focus on why Wikileaks did what it did, which notably includes timing the DNC documents to hit for maximum impact before the Democratic Convention and timing the Podesta emails to be a steady release leading up to the election.

I don’t rule out Russian involvement with all of that, but it is entirely unnecessary in this case. Wikileaks has long proven an ability to hype its releases as much as possible. More importantly, Assange has reason to have a personal gripe against Hillary, going back to State’s response to the cable release in 2010 and the subsequent prosecution of Chelsea Manning.

In other words, absent really good evidence to the contrary, I assume that Russia’s interests and Wikileaks’ coincided perfectly for this operation.

10) Russian state actors probed voter registration databases

Back in October, a slew of stories reported that “Russians” had breached voter related databases in a number of states. The evidence actually showed that hackers using a IP tied to Russia had done these hacks. Even if the hackers were Russian (about which there was no evidence in the first reports), there was also no evidence the hackers were tied to the Russian state. Furthermore, as I understand it, these hacks used a variety of methods, some or all of which aren’t known to be GRU related. A September DHS bulletin suggested these hacks were committed by cybercriminals (in the past, identity thieves have gone after voter registration lists). And the October 7 DHS/ODNI statement affirmatively said the government was not attributing the probes to the Russians.

Some states have also recently seen scanning and probing of their election-related systems, which in most cases originated from servers operated by a Russian company. However, we are not now in a position to attribute this activity to the Russian Government.

In late November, an anonymous White House statement said there was no increased malicious hacking aimed at the electoral process, though remains agnostic about whether Russia ever planned on such a thing.

The Federal government did not observe any increased level of malicious cyber activity aimed at disrupting our electoral process on election day. As we have noted before, we remained confident in the overall integrity of electoral infrastructure, a confidence that was borne out on election day. As a result, we believe our elections were free and fair from a cybersecurity perspective.

That said, since we do not know if the Russians had planned any malicious cyber activity for election day, we don’t know if they were deterred from further activity by the various warnings the U.S. government conveyed.

Absent further evidence, this suggests that reports about Russian trying to tamper with the actual election infrastructure were at most suspicions and possibly just a result of shoddy reporting conflating Russian IP with Russian people with Russian state.

11) Russian state actors used bots and fake stories to make information more damaging and magnify its effects

Russia has used bots and fake stories in the past to distort or magnify compromising information. There is definitely evidence some pro-Trump bots were based out of Russia. RT and Sputnik ran with inflammatory stories. Samantha Bee famously did an interview with some Russians who were spreading fake news. But there were also people spreading fake news from elsewhere, including Macedonia and Surburban LA. A somewhat spooky guy even sent out fake news in an attempt to discredit Wikileaks.

As I have argued, the real culprit in this economy of clickbait driven outrage is closer to home, in the algorithms that Silicon Valley companies use that are exploited by a whole range of people. So while Russian directed efforts may have magnified inflammatory stories, that was not a necessary part of any intervention in the election, because it was happening elsewhere.

12) The level at which all Russian state actors’ actions were directed and approved

The DHS/ODNI statement said clearly that “We believe, based on the scope and sensitivity of these efforts, that only Russia’s senior-most officials could have authorized these activities.” But the WaPo story suggests they still don’t have proof of Russia directing even the go-between who gave WL the cables, much less the go-between directing how Wikileaks released these documents.

Mind you, this would be among the most sensitive information, if the NSA did have proof, because it would be collection targeted at Putin and his top advisors.

13) The motive behind the actions of Russian state actors

The motive behind all of this has varied. The joint DHS/ODNI statement said it was “These thefts and disclosures are intended to interfere with the US election process.” It didn’t provide a model for what that meant though.

Interim reporting — including the White House’s anonymous post-election statement — had suggested that spooks believed Russia was doing it to discredit American democracy.

The Kremlin probably expected that publicity surrounding the disclosures that followed the Russian Government-directed compromises of e-mails from U.S. persons and institutions, including from U.S. political organizations, would raise questions about the integrity of the election process that could have undermined the legitimacy of the President-elect.

At one level, that made a lot of sense — the biggest reason to release the DNC and Podesta emails, it seems to me, was to confirm the beliefs a lot of people already had about how power works. I think one of the biggest mistakes of journalists who have political backgrounds was to avoid discussing how the sausage of politics gets made, because this material looks worse if you’ve never worked in a system where power is about winning support. All that said, there’s nothing in the emails (especially given the constant release of FOIAed emails) that uniquely exposed American democracy as corrupt.

All of which is to say that this explanation never made any sense to me; it was mostly advanced by people who live far away from people who already distrust US election systems, who ignored polls showing there was already a lot of distrust.

Which brings us to the other thing that is new in the WaPo story: the assertion that CIA now believes this was all intended to elect Trump, not just make us distrust elections.

The CIA has concluded in a secret assessment that Russia intervened in the 2016 election to help Donald Trump win the presidency, rather than just to undermine confidence in the U.S. electoral system, according to officials briefed on the matter.

[snip]

“It is the assessment of the intelligence community that Russia’s goal here was to favor one candidate over the other, to help Trump get elected,” said a senior U.S. official briefed on an intelligence presentation made to U.S. senators. “That’s the consensus view.”

For what it’s worth, there’s still some ambiguity in this. Did Putin really want Trump? Or did he want Hillary to be beat up and weak for an expected victory? Did he, like Assange, want to retaliate for specific things he perceived Hillary to have done, in both Libya, Syria, and Ukraine? That’s unclear.

14) The degree to which Russia’s efforts were successful and/or primary in leading to Hillary’s defeat

Finally, there’s the question that may explain Obama’s reticence about this issue, particularly in the anonymous post-election statement from the White House, which stated that the “election results … accurately reflect the will of the American people.” It’s not clear that Putin’s intervention, whatever it was, had anywhere near the effect as (for example) Jim Comey’s letters and Bret Baier’s false report that Hillary would be indicted shortly. There are a lot of other factors (including Hillary’s decision to ignore Jake Sullivan’s lonely advice to pay some attention to the Rust Belt).

And, as I’ve noted repeatedly, it is no way the case that Vladimir Putin had to teach Donald Trump about kompromat, the leaking of compromising information for political gain. Close Trump associates, including Roger Stone (who, by the way, may have had conversations with Julian Assange), have been rat-fucking US elections since the time Putin was in law school.

But because of the way this has rolled out (and particularly given the cabinet picks Trump has already made), it will remain a focus going forward, perhaps to the detriment of other issues that need attention.

Unpacking the New CIA Leak: Don’t Ignore the Aluminum Tube Footnote

This post will unpack the leak from the CIA published in the WaPo tonight.

Before I start with the substance of the story, consider this background. First, if Trump comes into office on the current trajectory, the US will let Russia help Bashar al-Assad stay in power, thwarting a 4-year effort on the part of the Saudis to remove him from power. It will also restructure the hierarchy of horrible human rights abusing allies the US has, with the Saudis losing out to other human rights abusers, potentially up to and including that other petrostate, Russia. It will also install a ton of people with ties to the US oil industry in the cabinet, meaning the US will effectively subsidize oil production in this country, which will have the perhaps inadvertent result of ensuring the US remains oil-independent even though the market can’t justify fracking right now.

The CIA is institutionally quite close with the Saudis right now, and has been in charge of their covert war against Assad.

This story came 24 days after the White House released an anonymous statement asserting, among other things, “the Federal government did not observe any increased level of malicious cyber activity aimed at disrupting our electoral process on election day,” suggesting that the Russians may have been deterred.

This story was leaked within hours of the time the White House announced it was calling for an all-intelligence community review of the Russia intelligence, offered without much detail. Indeed, this story was leaked and published as an update to that story.

Which is to say, the CIA and/or people in Congress (this story seems primarily to come from Democratic Senators) leaked this, apparently in response to President Obama’s not terribly urgent call to have all intelligence agencies weigh in on the subject of Russian influence, after weeks of Democrats pressuring him to release more information. It was designed to both make the White House-ordered review more urgent and influence the outcome.

So here’s what that story says.

In September, the spooks briefed “congressional leaders” (which for a variety of reasons I wildarseguess is either a Gang of Four briefing including Paul Ryan, Nancy Pelosi, Mitch McConnell, and Harry Reid or a briefing to SSCI plus McConnell, Reid, Jack Reed, and John McCain). Apparently, the substance of the briefing was that Russia’s intent in hacking Democratic entities was not to increase distrust of institutions, but instead to elect Trump.

The CIA has concluded in a secret assessment that Russia intervened in the 2016 election to help Donald Trump win the presidency, rather than just to undermine confidence in the U.S. electoral system, according to officials briefed on the matter.

The difference between this story and other public assessments is that it seems to identify the people — who sound like people with ties to the Russian government but not necessarily part of it — who funneled documents from Russia’s GRU to Wikileaks.

Intelligence agencies have identified individuals with connections to the Russian government who provided WikiLeaks with thousands of hacked emails from the Democratic National Committee and others, including Hillary Clinton’s campaign chairman, according to U.S. officials. Those officials described the individuals as actors known to the intelligence community and part of a wider Russian operation to boost Trump and hurt Clinton’s chances.

[snip]

[I]ntelligence agencies do not have specific intelligence showing officials in the Kremlin “directing” the identified individuals to pass the Democratic emails to WikiLeaks, a second senior U.S. official said. Those actors, according to the official, were “one step” removed from the Russian government, rather than government employees.

This is the part that has always been missing in the past: how the documents got from GRU, which hacked the DNC and John Podesta, to Wikileaks, which released them. It appears that CIA now thinks they know the answer: some people one step removed from the Russian government, funneling the documents from GRU hackers (presumably) to Wikileaks to be leaked, with the intent of electing Trump.

Not everyone buys this story. Mitch McConnell doesn’t buy the intelligence.

In September, during a secret briefing for congressional leaders, Senate Republican Leader Mitch McConnell (Ky.) voiced doubts about the veracity of the intelligence, according to officials present.

That’s one doubt raised about CIA’s claim — though like you all, I assume Mitch McConnell shouldn’t be trusted on this front.

But McConnell wasn’t the only one. One source for this story — which sounds like someone like Harry Reid or Dianne Feinstein — claimed that this CIA judgment is the “consensus” view of all the intelligence agencies, a term of art.

“It is the assessment of the intelligence community that Russia’s goal here was to favor one candidate over the other, to help Trump get elected,” said a senior U.S. official briefed on an intelligence presentation made to U.S. senators. “That’s the consensus view.”

Except that in a briefing this week (which may have been what impressed John McCain and Lindsey Graham to do their own investigation), that’s not what this represented.

The CIA shared its latest assessment with key senators in a closed-door briefing on Capitol Hill last week, in which agency officials cited a growing body of intelligence from multiple sources. Agency briefers told the senators it was now “quite clear” that electing Trump was Russia’s goal, according to the officials, who spoke on the condition of anonymity to discuss intelligence matters.

The CIA presentation to senators about Russia’s intentions fell short of a formal U.S. assessment produced by all 17 intelligence agencies. A senior U.S. official said there were minor disagreements among intelligence officials about the agency’s assessment, in part because some questions remain unanswered. [my emphasis]

That’s a conflict. Some senior US official (often code for senior member of Congress) says this is the consensus view. Another senior US official (or maybe the very same one) says there are “minor disagreements.”

Remember: we went to war against Iraq, which turned out to have no WMD, in part because no one read the “minor disagreements” from a few agencies about some aluminum tubes. A number of Senators who didn’t read that footnote closely (and at least one that did) are involved in this story. What we’re being told is there are some aluminum tube type disagreements.

Let’s hear about those disagreements this time, shall we?

Here’s the big takeaway. The language “a formal US assessment produced by all 17 intelligence agencies” is, like “a consensus view,” a term of art. It’s an opportunity for agencies which may have differing theories of what happened here to submit their footnotes.

That may be what Obama called for today: the formal assessment from all agencies (though admittedly, the White House purposely left the scope and intent of it vague).

Whatever that review is intended to be, what happened as soon as Obama announced it is that the CIA and/or Democratic Senators started leaking their conclusion. That’s what this story is.

Update: One other really critical detail. When the White House announced the Obama review today, Wikileaks made what was a bizarre statement. Linking to a CNN story on the Obama ordered review that erred on the side of blaming Russia for everything, it said, “CNN: Obama orders report into WikiLeaks timed for release just prior to Trump presidency.” Even though none of the statements on the review focused on what this story does — that is, on the way that the DNC and Podesta emails got to Wikileaks — Wikileaks nevertheless interpreted it as an inquiry targeted at it.

Update: And now David Sanger (whose story on the Obama-ordered review was particularly bad) and Scott Shane reveal the RNC also got hacked, and it is the differential leaking that leads the spooks to believe the Russians wanted Trump to win.

They based that conclusion, in part, on another finding — which they say was also reached with high confidence — that the Russians hacked the Republican National Committee’s computer systems in addition to their attacks on Democratic organizations, but did not release whatever information they gleaned from the Republican networks.

In the months before the election, it was largely documents from Democratic Party systems that were leaked to the public.

This may be a fair assessment. But you would have to account for two things before making it. First, you’d need to know the timing and hacker behind the RNC hack. That’s because two entities are believed to have hacked the DNC: an FSB appearing hacking group, and a GRU one. The FSB is not believed to have leaked. GRU is believed to have. So if the FSB hacked the RNC but didn’t leak it, it would be completely consistent with what FSB did with DNC.

NYT now says the RNC hack was by GRU in the spring, so it is a fair question why the DNC things got leaked but RNC did not.

Also, Sanger and Shane say “largely documents” from Dems were leaked. That’s false. There were two streams of non-Wikileaks releases, Guccifer, which did leak all-Dem stuff, and DC Leaks, which leaked stuff that might be better qualified as Ukrainian related. The most publicized of documents from the latter were from Colin Powell, which didn’t help Trump at all.

Update: It’s clear that Harry Reid (who of course is retiring and so can leak speech and debate protected classified information without worrying he’ll be shut off in the future) is one key driver of this story. Last night he was saying, “”I was right. Comey was wrong. I hope he can look in the mirror and see what he did to this country.” This morning he is on the TV saying he believes Comey had information on this before the election.

Update, 12/10: This follow-up from WaPo is instructive, as it compares what CIA briefed the Senate Intelligence Committee about the current state of evidence with what FBI briefed the House Intelligence Committee about the current state of evidence. While the focus is on different Republican and Democratic understandings of both, the story also makes it clear that FBI definitely doesn’t back what WaPo’s sources from yesterday said was a consensus view.

The Game of Telephone about the Election Hacking Review

This morning, the White House announced that Obama has ordered a review of election-related hacking, to be completed before Donald Trump takes over. I want to capture the varying descriptions of what the review will entail.

Politico: The review will look at the hacks blamed on the Russians this year and malicious cyber activity (publicly understood to be China in 2008 and someone else in 2012) going back to 2008

The review will put the spate of hacks — which officials have blamed on Russia — “in a greater context” by framing them against the “malicious cyber activity” that may have occurred around the edges of the 2008 and 2012 president elections, said White House principal deputy press secretary Eric Schultz at a briefing.

“This will be a review that is broad and deep at the same time,” he added.

[snip]

In 2008, the campaigns for both Sen. John McCain (R-Ariz.) and Obama were bombarded by suspected Chinese hackers, according to U.S. intelligence officials. The digital intruders were reportedly after internal policy papers and the emails of top advisers.

And in 2012, Gawker reported that hackers had broken into Republican presidential candidate Mitt Romney’s personal Hotmail account after correctly answering his backup security question: “What is your favorite pet?”

“We will be looking at all foreign actors and any attempt to interfere with the elections,” Schultz said.

WaPo: The review will be a “full review” of Russian hacking during the November election

President Obama has ordered a “full review” of Russian hacking during the November election, as pressure from Congress has grown for greater public understanding of exactly what Moscow did to interfere in the electoral process.

[snip]

U.S. intelligence and law enforcement agencies had already been probing what they see as a broad covert Russian operation to sow distrust in the presidential election process. It was their briefings of senior lawmakers that led a number of them to press for more information to be made public.

[snip]

Though Russia has long conducted cyberspying on U.S. agencies, companies and organizations, this presidential campaign marks the first time Russia has attempted through cyber means to interfere in, if not actively influence, the outcome of an election, the officials said.

CNN: The review will look at “hacking by the Russians aimed at influencing US elections going back to 2008” (CNN notes that the IC “never said there was strong evidence that [hacks of voter registration systems were] tied to the Russian government”)

President Barack Obama has ordered a full review into hacking by the Russians aimed at influencing US elections going back to 2008, the White House said Friday.

“The President has directed the Intelligence Community to conduct a full review of what happened during the 2016 election process. It is to capture lessons learned from that and to report to a range of stakeholders,” White House Homeland Security and Counterterrorism Adviser Lisa Monaco said at a Christian Science Monitor breakfast with reporters Friday. “This is consistent with the work that we did over the summer to engage Congress on the threats that we were seeing.”
White House spokesman Eric Schultz added later that the review would encompass malicious cyber activity related to US elections going back to 2008. [my emphasis]

Wikileaks (relying on the CNN story): The review will look at Wikileaks

CNN: Obama orders report into WikiLeaks timed for release just prior to Trump presidency

NYT: The review will look at all Russian efforts to influence the 2016 election, including publishing email contents and probing the “vote-counting system” (presumably a reference to voter lists that have nothing to do with vote counting)

President Obama has ordered American intelligence agencies to produce a full report on Russian efforts to influence the 2016 presidential election, his homeland security adviser said on Friday. He also directed them to develop a list of “lessons learned” from the broad campaign the United States has accused Russia of carrying out to steal emails, publish their contents and probe the vote-counting system.

Does Dark Marketing Have a Function in Trump’s Mobs?

As you likely know, Trump has sicced his mobs onto one of the first non-public figures since the election: the United Steel Worker organizer for the Carrier plants affected by Trump’s involvement, Chuck Jones.

On Tuesday, Jones said that Trump “lied his ass off” about the Carrier deal, pointing out the same thing I did: that 300 of the jobs Trump took credit for “saving” were actually white collar engineer jobs. Jones said they were never slated to move to Mexico.

At first, Jones’ comments only showed up in print outlets and Trump had no response. But then CNN ran the comments (it seems, though this is not yet proven, that Trump primarily tweets out when things get on TV). And Trump responded.

The response, in general, was encouraging: rather than just report that Trump had attacked a labor organizer, several TV programs had Jones on, resulting in giving him even more opportunity to call Trump a liar.

Except then the creepy calls started.

Half an hour after Trump tweeted about Jones on Wednesday, the union leader’s phone began to ring and kept ringing, he said. One voice asked: What kind of car do you drive? Another said: We’re coming for you.

He wasn’t sure how these people found his number.

“Nothing that says they’re gonna kill me, but, you know, you better keep your eye on your kids,” Jones said later on MSNBC. “We know what car you drive. Things along those lines.”

“I’ve been doing this job for 30 years, and I’ve heard everything from people who want to burn my house down or shoot me,” he added. “So I take it with a grain of salt and I don’t put a lot of faith in that, and I’m not concerned about it and I’m not getting anybody involved. I can deal with people that make stupid statements and move on.”

This is, of course, not new with the election. Trump did it all through the campaign, particularly targeting protestors at his events. But this makes it clear he is perfectly happy to target individuals for retaliation when they call him on his lies.

I’ll have more to say about what I think the appropriate response to this is (though as I said, I was reassured by last night’s performance, to a point).

But given the way last night’s tweets led so quickly to threatening phone calls, I wanted to raise this article [This is in German, but an English translation is due soon; I read it using Google translate; I will update with quotes when it is translated], on the psychological approach behind Trump’s Cambridge Analytica work during the election (which were covered in less detail in this Bloomberg article). It describes the model behind Cambridge Analytics, the amount of data it collects, and the kind of accuracy it claims. The article describes how closely the model has been integrated with Facebook. And it describes how CA got bought by Strategic Communications Laboratories, which has been used for things like influence campaigns in Afghanistan. The article then describes CA’s role in Brexit, and how first Ted Cruz and then Trump came to rely on it (partly at the direction of billionaire Robert Mercer. The article then describes how CA uses highly individualized maps of individuals to target advertising.

The success of marketing by Cambridge Analytica is based on the combination of three elements: psychological behavioral analysis according to the Ocean model, big-data evaluation and ad-targeting. Ad targeting, that is personalized advertising, that is advertising, which adapts as closely as possible to the character of an individual consumer.

Nix frankly explains how his company does it (the lecture is available on Youtube free). Cambridge Analytica purchases personal data from all sorts of sources: land registry entries, bonus cards, dial-up directories, club memberships, journal subscriptions, medical data. Nix shows the logos of globally operating data traders like Acxiom and Experian – in the USA almost all personal data are available for purchase. If you want to know where, for example, Jewish women live, you can simply buy this information. Including telephone numbers. Now Cambridge Analytica crosses this number packets with voter lists of the Republican Party and online data as Facebook Likes – then one calculates the Ocean Personality Profile: From digital footprints suddenly real people with fears, needs, interests – and with a residential address.

The article goes on to describe (as Bloomberg had) how Trump used dark ads, targeted to very narrowly tailored groups, to depress Hillary’s turnout.

There are a lot of implications of all this, if the targeting is as effective as CA likes to claim. But I wonder whether Trump intends to use it as part of his governance strategy (there were reports that Steve Bannon only agreed to join the campaign if he got access to the data). Obviously, a Trump Administration could use such an approach to apply pressure on specific legislators.

But people close to Trump (this is all hypothetical, but this is the kind of thing you keep a plausible deniability distance away from the principal) could also use it to rile up anger in response to perceived slights of the President.

Trump has been playing a double game. The firing of Michael Flynn (the son) from the transition team — in part because Flynn had a role in riling up PizzaGate — makes it clear Trump wants to maintain a visible distance from the violence his supporters commit. But Trump has always relied on mobilizing his mob to heighten the illusion that he is under attack, and his persistence in doing so after actual violence shows it is intentional.

So what might Trump’s team do with a proven communication program that can communicate with almost no notice?

The Bible Still Outperforms Facebook in Delivering Fake News

screen-shot-2016-12-07-at-8-30-48-am

We’ve reached the stage where articles about fake news themselves engage in fake news tactics.

Buzzfeed’s Craig Silverman — who has written many of the stories on fake news in recent weeks — had Ipsos do a poll querying whether or not people believed some of the real and fake news headlines that got shared around during the election. He presented the results, in both tweets and his BuzzFeed article on the results, this way:

screen-shot-2016-12-07-at-7-25-37-am

But that’s not actually what the poll showed, though a number of people — even some of the people who are the most dedicated serious commentators on fake news — seemed to believe the headline without reading the article closely (that is, they treated it precisely like fake news consumers might, including sharing it before they had evaluated it critically).

Rather, the poll showed that of the people who remember a given headline, 75% believed it. But only about 20% remembered any of these headlines (which had been shared months earlier). For example, 72% of the people who remembered the claim that an FBI Agent had been found dead believed it, but only 22% actually remembered it; so just 16% of those surveyed remembered and believed it. The recall rate is worse for the stories with higher belief rates. Just 12% of respondents remembered and believed the claim that Trump sent his own plane to rescue stranded marines. Just 8% remembered and believed the story that Jim Comey had a Trump sign in his front yard, and that made up just 123 people out of a sample of 1809 surveyed.

Furthermore, with just one exception, people recalled the real news stories tested more than they did the fake and with one laudable exception (that Trump would protect LGBTQ citizens; it is “true” that he said it but likely “false” that he means it), people believed real news at rates higher than they did fake. The most people — 22% — recalled the fake story about the FBI Agent, comparable to the 23% who believed some real story about girl-on-girl pictures involving Melania. But 34% remembered Trump would “absolutely” register Muslims and 57% remembered Trump’s claim he wasn’t going to take a salary.

The exception should be an exception, because Buzzfeed shouldn’t have treated it as news anyway. Just 11% recalled Mike Morell’s endorsement, titled “I ran the CIA. Now I’m endorsing Hillary Clinton,” which appeared in NYT’s opinion section. All endorsements should be considered opinion, and this one happens to be from a proven liar with a history of torture apology, so for the rare people who knew anything about Morell, I would hope his opinion would carry limited weight.

What all of this shows is that the fake news headline claims Buzzfeed made last month, that “Fake Election News Stories Outperformed Real News On Facebook,” should be revised. What that clickbait story actually showed was that the top fake stories received more “engagement” — shares, reactions, and comments — on Facebook than the top real news. But the last paragraph of the article admitted that might not be the same as actual consumption or even non-Facebook moderated engagement.

It’s important to note that Facebook engagement does not necessarily translate into traffic. This analysis was focused on how the best-performing fake news about the election compared with real news from major outlets on Facebook. It’s entirely possible — and likely — that the mainstream sites received more traffic to their top-performing Facebook content than the fake news sites did. As as the Facebook spokesman noted, large news sites overall see more engagement on Facebook than fake news sites.

What this newly reported poll at least suggests (one would need to do a more scientific study to test this hypothesis) is that even the most shared fake news was not really retained, whereas more of the real news was. And that’s true even in spite of the fact that Buzzfeed/Ipsos did not test the most popular real news (in reality this, too, is an opinion piece), “Trump’s history of corruption is mind-boggling. So why is Clinton supposedly the corrupt one?” That’s a pity, because it’d be interesting to see how many and what kind of people remembered and believed that one.

Effectively, then, Buzzfeed was testing the most popular fake news (about the Pope endorsing Trump, with 960,000 engagements) against the third ranking real news (the Melania girl-on-girl story, with 531,000 engagements) and real news still performed better overall in terms of recall. Which would seem to suggest these Facebook engagements don’t actually track how much “news” — fake or not — people will consciously retain (I admit unconscious retention is probably an issue too).

Which is how I get to my claim that the Bible outperforms Facebook for spreading false news. After all, as recently as 2014, 42% of Americans believed in creationism, while just 19% believed in evolution. That number is changing quickly (importantly, as more purportedly fake news consuming youngsters who don’t consider themselves religious get asked). Nevertheless, a significantly larger chunk of the country believes that God plunked us down fully-formed into Eden than believe that an FBI Agent involved in the Clinton case died in a murder suicide.

We should expect more people to believe what they read in the Bible, because it is a story that gets reinforced week after week by people with some authority in the community. It also gets reinforced in institutions like the Creation Museum, where I took the picture of white Adam and Eve above. For people who believe in creationism, their religion is fundamentally tied to their self-identity in a way that politics might not be. It is precisely for that reason it provides important counterpoint to these fake news stories. Especially given the way that a preference for religious stories over scientific ones poisons so much of our ability to deal with crises like climate change.

Don’t get me wrong: algorithmically-delivered sensationalism is a problem (as are polls that get shared to make claims about headlines they don’t really support). But it is one of many problems with our politics, and the evidence from this poll actually suggests it isn’t yet the most urgent one.

Update: Pope Francis, who believes the notion of evolution can coexist with that of creation, just issued a statement calling those who spread shit news sinners.

Francis told the Belgian Catholic weekly “Tertio” that spreading disinformation was “probably the greatest damage that the media can do” and using communications for this rather than to educate the public amounted to a sin.

Using precise psychological terms, he said scandal-mongering media risked falling prey to coprophilia, or arousal from excrement, and consumers of these media risked coprophagia, or eating excrement.

[snip]

“I think the media have to be very clear, very transparent, and not fall into – no offence intended – the sickness of coprophilia, that is, always wanting to cover scandals, covering nasty things, even if they are true,” he said.

Update: Matthew Ingram covers this issue at Fortune.

The #FakeNews about Iraqi WMD Got Hundreds of Thousands Killed

screen-shot-2016-12-06-at-2-12-32-pm

This morning, Dana Milbank — who used to have a podcast with Chris Cillizza on which he once suggested Hillary would choose to drink Mad Bitch beer —  wrote a piece warning of the dangers of fake news.

After writing about a threatening email he received, Milbank considered whether episodes like the attack on Comet Ping Pong — which he described as “the family pizza place in Northwest Washington I’ve been frequenting with my daughter ever since she was a toddler a decade ago” — were the new normal. Milbank described the role of Alex Jones in making a “bogus and bizarre accusation” against Hillary. Then he turned the attack on Comet Ping Pong, in part, into an attack on the media.

This would appear to be the new normal: Not only disagreeing with your opponent but accusing her of running a pedophilia ring, provoking such fury that somebody takes it upon himself to start shooting. Not only chafing when criticized in the press but stoking anti-media hysteria that leads some supporters to threaten to kill journalists.

The man whose “Mad Bitch beer” comment targeted Hillary ended his piece by scolding Trump for fueling rage against Hillary and those who support her.

If Trump were a different leader, he would declare that political violence is unacceptable in a free society. Perhaps he’d say it after eating a “Steel Wills” pie at Comet.

But instead he continues to fuel rage against his opponents and his critics.

On Twitter, Peter Singer — who wrote a very worthwhile book that uses fiction to lay out near term threats to the US  — RTed Milbank’s story with the comment, “stop winking and nodding” at fake news because it can get people killed.

screen-shot-2016-12-06-at-2-29-06-pm

Singer works at New America Foundation, but he used to work at Brookings Institution, which employs people like Michael O’Hanlon and Charles Lister to write propaganda, funded in part by Qatar, designed to generate support for endless wars in the Middle East.

In response to Singer’s tweet, I RTed it and pointed out that “The #fakenews about Iraqi WMD DID get hundreds of thousands killed.” That in turn led to some interesting discussions, most notably with Zeynep Tufekci, who claimed that by “conflating two very, very different types of failure” I was being unhelpful because those different kinds of fake news operated via different mechanisms.

Tufekci is right. The means by which an uncritical press — enthusiastically joined by the WaPo’s editorial page and many, but not all, of its reporters — parroted Dick Cheney’s lies about Iraqi WMD are different than the means by which millions of people sought out the most outrageous claims about Hillary. The means by which the financial press claimed the housing market would never collapse are different than the means by which millions of people sought out conspiracy theories about the people who didn’t prosecute the banksters. The means by which Dana Milbank got to insinuate the Secretary of State might choose Mad Bitch beer are even different than the means by which millions of people sought out news that called the former Secretary of State #CrookedHillary. The means by which the traditional press focused more attention on Hillary’s email server than on Trump’s fraudulent business practices are different than the means by which millions of people sought out claims that Hillary’s email server was going to get her indicted. All of those traditional news examples of fake news included an editorial process designed to prevent the retelling of fake news.

The means by which traditional news media shares fake news are different than social media’s algorithm driven means of sharing fake news.

Until you remember that a week before the election, Fox’s Bret Baier, who eight months earlier had moderated a GOP primary debate, reported that the investigations into Hillary “will continue to likely an indictment.” While Baier retracted the claim just over a day later, the claim was among the most damaging pieces of fake news from the campaign, not least because it confirmed some of what the most inflammatory social media claims were saying and magnified the damage of Jim Comey’s irresponsible announcement about finding new emails.

Baier got manipulated by his sources who knew how to game the means the press uses to avoid fake news. Baier got manipulated into sharing fake news that served the goals of his sources. It turns out Baier was not any more immune from the manipulation of his biases than your average news consumer is.

Now, the NYT (though not, I think, the WaPo) apologized for their WMD coverage and Milbank apologized for his Mad Bitch podcast and Baier apologized for his indictment scoop. No one has yet apologized for focusing more attention on Hillary’s email server than Trump’s own corruption, but I’m sure that’s coming. I’m not aware that the financial press apologized for the cheerleading that ultimately led to millions of Americans losing their homes to foreclosure, but then it also hasn’t stopped the same kind of fake news cheerleading that led to the crash.

Indeed, while it shows remorse after some of the worst cases, the traditional news media still lapses into the habit of reporting fake news, often in a tone of authority and using an elite discourse. Such lapses usually happen when a kind of herd instinct or a rush to get the news first sets in, leading news professionals to tell fake news stories.

And, now that social media has given average news consumers the ability (and after financialization has led to the disappearance of reliable local news), average news consumers increasingly bypass news professionals, listening instead to the stories they want to hear, told in a way that leads them to feel they are assuming a kind of self-control, told in a language and tone they might use themselves. At its worst — as in the case of PizzaGate — a kind of herd instinct sets in, with news consumers reinforcing each others’ biases. On Sunday, that almost got a lot of innocent people — families like Milbank’s own — killed.

Elite commentators may view the herd instincts of average news consumers to be more crude than the herd instincts of professional news tellers. Perhaps they are. Across history, both types of herd instincts have led to horrible outcomes, including to the deaths of hundreds of thousands, even millions of people.

But as we try to deal with our herd instincts and the mistakes we all make (myself very much included), we might do well to exhibit a little less arrogance about it. That certainly won’t eliminate the mistakes; we are, ultimately, herd animals. But it might provide a basis to rebuild some trust, without which leads all of us — the professionals and the average news consumers — further into our own bubbles.

Update: This Current Affairs piece treats WaPo’s peddling of fake news — including the PropOrNot story — well.

MI AG Bill Schuette Is Always on the Wrong Side of History — So I Now Enthusiastically Back MI’s Recount

As I’ve noted in bmaz’ posts opposing Jill Stein’s recounts in WI, MI, and PA (comment, comment), I did not start out opposed to the recounts. While I agree that the recounts are unlikely to change the outcome, I think getting in the habit of doing unexpected recounts is a necessary thing to ensure the integrity of the counting software.

I got more interested in the recount when I learned former MI Democratic Chair Mark Brewer was representing Stein in her challenge in MI. Brewer is a serious lawyer and a numbers genius. His involvement gave me confidence that it will be legally competent.

I also think the recount may help explain the big jump in undervotes this year. As Charles Gaba demonstrated, ballots in this year’s presidential election showed far more ballots in which there was no vote cast for President than in previous years.

screen-shot-2016-12-02-at-10-31-49-am

While I think the historic unpopularity of the candidates may explain this, such an explanation would be more convincing if MI had had an important statewide election this year that might explain why people took the trouble to vote but didn’t vote for President. But we didn’t — we’re on the off-cycle for Senator, for example.

Add in the state’s effort to eliminate straight ticket voting and the way that voters are supposed to be able to vote a straight ticket but with one counter-party vote, along with Hillary’s underperformance in swing suburbs, and I think it possible the recount may show something of interest.

Plus, Trump won by less than 11,000 votes, so it wouldn’t take too much to flip the outcome.

Then I saw the reaction of both parties. Both the Republicans and Democrats are taking this recount more seriously than I expected, leading me to believe that both parties have some unstated reason to believe this recount may reveal problems with the election. There were also a few other details about the actions of GOP Secretary of State Ruth Johnson that I have questions about. So my interest grew.

But I was always a bit lukewarm on the recount, at least considering the objections of people like bmaz.

Until now.

Michigan Attorney General Bill Schuette just filed a motion to have the courts force the Board of Canvassers not to count the vote. Schuette cited the risk that the recount might not be finished within the safe harbor period (though any delay and lawsuit just makes that more likely). But he also claimed the recount might cost the state “millions of dollars.”

Schuette’s intervention is, by itself, enough to convince me the recount is a good thing. The man is always on the wrong side of history. Plus, his choice to be on the wrong side of history has itself cost Michigan millions of dollars. We know his efforts to prevent loving couples from marrying cost the state almost $2 million. I don’t think we yet know the full cost of his failed effort to prevent Michiganders from voting a straight ticket, which he also argued all the way to the Supreme Court.

Bill Schuette should not attempt to argue that a legal challenge will cost the state too much money with a straight face, because he has already squandered millions of our tax dollars on his own challenges.

Meanwhile, Schuette is issuing this challenge even as his party is in the middle of rushing through a strict new voter suppression bill that — because it was written to avoid a poll tax challenge — will cost the state undetermined funds, all to combat a voter fraud problem that doesn’t exist. The MI GOP is arguing that the costs of suppressing the vote are worthwhile, while costs of counting it are not.

Finally, all this is taking place even as the MI legislature is rushing through $300 million in new tax cuts for businesses. If we can’t afford to recount the vote, we surely can’t afford to give businesses new giveaways.

So all that has convinced me. If Schuette is opposed to this recount — and if he wants to make up transparently bullshit excuses about costs to make that argument — then I’m now an enthusiastic supporter of it.

Our Industrial Policy Is the F-35

screen-shot-2016-12-01-at-10-14-03-am

Lockheed photo.

With the news of Donald Trump’s deal to keep 1,100 of 2,100 Carrier jobs in Indiana, coastal elites appear to have just discovered tax-supported Midwestern manufacturing jobs, even as they continue to ignore tax-supported defense contractor (manufacturing) jobs.

As best as I can understand it from the details released so far, the deal may be best understood as a mix of typical state-level efforts combined with the leverage of a federal level effort. Over 25% of the jobs saved will be engineer and headquarter jobs — important for retaining technological capacity in the US, but not a big help to blue collar workers.

The package is reportedly substantially similar to one IN Governor and soon to be Vice President Mike Pence already offered.

UTC agreed to retain approximately 800 manufacturing jobs at the Indiana plant that had been slated to move to Mexico, as well as another 300 engineering and headquarters jobs. In return, the company will get roughly $700,000 a year for a period of years in state tax incentives.

Some 1,300 jobs will still go to Mexico, which includes 600 Carrier employees, plus 700 workers from UTEC Controls in Huntington, Ind.

That has commentators on all sides — from economists to Bernie Sanders — complaining that Trump just made it more likely companies will demand bribes to retain US based jobs in the future.

That’s of course a fantasy. Companies already demand bribes to keep jobs in particular states (or in the US generally).* This is just a typical deal — indeed, it was a typical failed deal until the guy making it became Vice President-elect thanks in part to his new boss’ running on making a better deal.

The way companies arbitrage states and countries to get the best deal to preserve jobs is not a good thing — at all. But it’s one that must be solved at a systematic level, a point Jared Bernstein made in the WaPo.

This sort of production cannot be sustained as some sort of non-competitive museum model, where we push back on trade-induced job losses through tax breaks and government contracts. True, governors and mayors commonly dole out such goodies as bribes to factories to settle in one state vs. another, but that’s a zero-sum game, and often ends up as a big waste of precious resources. Meanwhile, it’s also a game of corporate whack-a-mole. While Trump et al. were brokering this deal, nearby factories were packing up for Mexico.

As I recently wrote, we’ve generally failed to even try to implement a solution to this problem of global competition eroding our manufacturing base. A systemic approach, as opposed to what Trump is up to here, will require reducing our trade deficit in manufactured goods by pushing back against countries that manage their currencies to make our exports expensive and their exports cheap. It will require investments in advanced manufacturing so we can close the wage gap with productivity. It will require systemic state and older city economic development of the type economist Tim Bartik describes here and here. It may require direct job creation to employ displaced workers when none of the above comes through.

The key twist on this story, however, is that Carrier was convinced to deal when Trump started threatening that federal contracts with Carrier’s parent company, United Technologies, might be at risk if they didn’t.

John Mutz, a former Indiana lieutenant governor who sits on the [Indiana Economic Development Corporation’s] 12-member board, told POLITICO that Carrier turned down a previous offer from IEDC before the election. He said he thinks the choice is driven by concerns from Carrier’s parent company, United Technologies, that it could lose a portion of its roughly $6.7 billion in federal contracts.

“This deal is no different than other deals that we put together at the IEDC to retain jobs, but the fact is that the difference is that United Technologies depends on the federal government for lots of business,” Mutz said.

Kevin Drum — while citing a lot of health care and finance jobs (both heavily supported by federal policy) as the true job leaders in Indianapolis — considers the pressure on United Technologies to be an outrage.

This would be a massive abuse of power, of course, but who wants to take a chance that Trump cares? Probably not UT.

I actually think the deal ought to elicit a more interesting discussion of industrial policy — the kind of systematic intervention that Bernstein talks about that might actually do something about the hollowing out of America’s manufacturing base.

Such a discussion has long been forbidden in American political discourse, in part because the same economists pretending such whack-a-mole bribes haven’t become the norm in American political life also pretend that an unfettered “free” market (always defined to include mobile capital and goods, but not labor) will benefit everyone.

Yet even during the period when any discussion of industrial policy has been forbidden, we’ve had one.

Our industrial policy consists of massive US investments in manufacturing war and intelligence toys that we then sell to foreign governments. When done with Middle Eastern petro-states like Saudi Arabia, that trade goes a long way to equalize our foreign trade deficit, but it contributes directly to instability that then requires us to intervene and build more war toys. That investment in war leads, in turn, to a disinvestment in publicly funded infrastructure that could also provide jobs in the heartland.

The most obvious symbol of our unacknowledged industrial policy is the F-35, a trillion dollar federal investment for a plane that has yet to meet basic requirements, one beset by years of rework. As it happens, one of many causes of problems with the F-35 is big reliability problems with engines used in the plane. That makes those faulty engines, made by United Technologies subsidiary Pratt & Whitney, just another direct taxpayer investment in UTC jobs. Yet reliability problems didn’t prevent P&W from getting another contract for the F-35 engine earlier this year. Nor did P & W’s provision of attack helicopter technology to the Chinese via a Canadian subsidiary.

Our current industrial policy, you see, feeds so few prime contractors that they are virtually immune from the competition that might pressure them to deliver quality goods. Which leads, in turn, to rework, contract overruns, and contractors walking out of the building with our government’s most closely guarded secrets, all with no consequences.

Let’s stop pretending (as this piece does) that America’s manufacturing, increasingly dominated by the production of war toys, exists in a a real market, shall we?

Once we do that, we might begin to address the diseases of our defense contracting and — more importantly — rediscover the value of investing in other kinds of manufacturing that our country needs to have. Justify these investments by some future defense need, I don’t give a damn (though there are military officials who will soberly explain the risks of the hollowing out of our manufacturing base). But invest in the technologies the US needs to stay competitive and retain a manufacturing base.

There was a brief moment when Obama tried to do this by investing in battery factories in MI and other Rust Belt states, an investment justified because the US lagged so far behind South Korea on this critical technology. The investments were badly executed, and then later undermined by the KORUS trade deal. Republicans made them toxic with the Solyndra faux scandal. And so, rather than siting one after another killer app in locales whose older economies had failed, such efforts largely ended.

Imagine how the climate change negotiations might have changed, though, if they came with key investments in alternative energies in coal mining areas of West Virginia and Kentucky?

But this Carrier deal — no matter how much of a gimmick — should be an opportunity to shift the discussion. Trump (and Pence) just federalized the kind of deal every state makes out of desperation, pitting states against each other and Mexico and China. If they can do that, in part by leveraging federal contracting, then they can also pursue an honest industrial policy, one not dependent on selling war toys to our belligerent authoritarian friends overseas.

I doubt Trump will do that. But his Carrier deal ought to at least invite a debate about it.

Update: Added a link to the deferred prosecution for when Pratt & Whitney dodged export restrictions to provide technology to China.

Update: The other day Bloomberg did a review of the Department of Energy’s Loan Program Office, which funded Solyndra (but which, as was covered at the time, actually dates to W’s Administration) actually has been very successful.

Not only has the program’s loan portfolio generated about $1.65 billion in interest payments to date, its mission to support major energy projects fits into Trump’s goal of stimulating investment in the U.S., said Jonathan Silver, a former head of the loan programs office.

“The President-elect was talking directly about significant investments in infrastructure,” Silver said in an interview Monday at Bloomberg headquarters in New York. The program is intended to support not just clean-energy projects, but also industries Trump championed during the campaign, including coal, among other advanced fossil fuels. “This is infrastructure. It doesn’t get any more infrastructure-ish than this.”

The office dates to the George W. Bush administration and was designed to offer loan guarantees to innovative energy projects that struggle to get financing from commercial and investment banks. In some cases it also approved loans funded through the Federal Financing Bank.

It supported the first big solar farms in the country and helped commercialize solar-thermal systems, advanced nuclear designs, molten-salt storage and other technologies. It has yet to finance an advanced fossil-fuel project.


*Disclosure: My spouse works for a manufacturing company often touted, locally and nationally, as a huge success; it receives state tax credits.

Seven Democrats Write Obama Asking Him to Declassify More Information on Russian Involvement in the Election

Ron Wyden, five other Democrats, and Dem caucusing Independent Angus King just wrote Obama a cryptic letter. The entire body of the letter reads:

We believe there is additional information concerning the Russian Government and the U.S. election that should be declassified and released to the public. We are conveying specifics through classified channels.

Thank you for your attention to this important matter.

Aside from the fact that this suggests (as Wyden’s cryptic letters always d0) there is something meaty that we really ought to know, I find the list of signers rather curious. In addition to Wyden, the following Senators signed the letter:

  • Jack Reed
  • Mark Warner
  • Barb Mikulski
  • Martin Heinrich
  • Angus King
  • Mazie Hirono

That is, every Democratic SSCI member except current Chair Dianne Feinstein, plus Senate Armed Services Chair Jack Reed, signed the letter. So every Democrat except DiFi and Majority Leader Harry Reid signed the letter, suggesting it is something that got briefed to the full Senate Intelligence Committee as well as the Ranking Members of SASC (the latter of which suggests NSA or CYBERCOM may be involved).

I’m as interested in the fact that DiFi and Reid didn’t sign as that the others did sign. It can’t be that Reid is retiring and DiFi is heading to SJC (it’s still unclear whether she’ll remain on SSCI or not). After all, Mikulski is retiring as well.

Plus, Harry Reid wrote a far more explicit letter last month to Jim Comey — apparently following up on a non-public letter send months earlier — alluding to direct coordination between Trump and Russia.

In my communications with you and other top officials in the national security community, it has become clear that you possess explosive information about close ties and coordination between Donald Trump, his top advisors, and the Russian government – a foreign interest openly hostile to the United States, which Trump praises at every opportunity. The public has a right to know this information. I wrote to you months ago calling for this information to be released to the public. There is no danger to American interests from releasing it. And yet, you continue to resist calls to inform the public of this critical information.

Finally, what to make of the fact that not even John McCain signed onto this letter? Reed’s inclusion makes it clear that McCain, too, must have been briefed. He has been outspoken about Trump’s moves to cozy up to Putin. If he has seen — and objects to — such coordination, why not sign onto this letter and give it the patina of bipartisanship?

The Stein Recount Needle and the Damage Done

vote-recountI stated earlier my issues with the Jill Stein fueled “recount” effort. Since that time, there seems to be a hue and cry to the effect of “irrespective of Stein, these will be helpful and are especially needed after Trump’s lie!”.

There are many instances of that thought, but this from Will Bunch at the Philadelphia Inquirer/Daily News, a friend whom I admire and like greatly, is indicative:

The stakes are too high to calculate. But there is one other thing about Trump’s big lie about the 2016 election. Ironically, before today, the case for a recount in the three states was a tad shaky. While the threat of Russian (or other) hacking has been a valid concern, little in the way of actual evidence of a stolen election has emerged since November 8. But now that Trump has alleged massive fraud, the integrity of the American system demands that the result be audited and properly certified. So let the re-counting begin.

I disagree rather strongly.

As said, I already stated my objection to Stein’s effort, as initially targeted to Wisconsin. Let’s take a look at the situation in Pennsylvania, where Stein has putatively filed today, the last possible day legally. A quote from Pennsylvania election lawyer Gregory Harvey in local Pennsylvania press is instructive:

The biggest obstacle to this getting anywhere may be deadlines. The recount petitions come on the very last day, and if they’re designed to generate enough evidence to contest the election, that’s going to be a stretch.

Harvey, the election lawyer says the deadline for an election contest, which must spell out the specific conduct that merits overturning the result, is also Monday, Nov. 28. With a compelling case you can always ask the court to make an exception, but they tend to be pretty strict about election law — that thing about not changing the rules after the game is played.

Harvey said Steins’ prospects for success are so remote that “raising money to do something in Pennsylvania must be intended only to publicize the Green Party.”

Again, remember, there is a difference between rote “recounts” and comprehensive “audits”. This is especially germane to WI as noted previously, but also to Pennsylvania, and Michigan, should it come too. Even if the recount found something, and there is no basis to believe it will, the legal timeframe is blown. And, no, courts are not likely to remedy such laches. (So, where has Stein been for weeks since the election and before she so conveniently glommed on to, and misrepresented, Halderman et al’s report?) Ah, late breaking, indeed Wisconsin has already denied the last second recount by hand from Stein and Stein is now suing to try to overcome the administrative ruling:

Unless Stein wins her lawsuit in Dane County Circuit Court, officials in each of Wisconsin’s 72 counties would decide on their own whether to do their recounts by hand. That could mean some counties perform recounts by machine and some by hand.

Yes, shocking! And good luck with that. Again, as I have relentlessly stated, once you approach administrative boards and, even more so, courts, you need actual demonstrable bases for your argument of fraud, mistake etc. Which is something Jill Stein and her effort simply have never had. That does not cut it. Ooops!

Stein has until Wednesday to file in Michigan, but there is no reason to think the effort will be any more focused, intelligently drafted, nor timely, than has been displayed to date in Wisconsin and Pennsylvania.

But there are bigger issues here than Jill Stein’s folly, right? Right! Indeed there are, and Stein’s cynical effort only hurts those larger picture items. But, irrespective of all of the above, it is a wonderful thing that the votes are being recounted, right? Maybe, and quite arguably, maybe not.

If this effort involved intelligent and targeted meaningful “audits” of voting in Wisconsin, Pennsylvania and Michigan, that would truly yield the data we need to answer a variety of questions, I would agree wholeheartedly. But that is not what is afoot here via Stein. These are rote last second “recounts”, likely through the same tabulation mechanisms originally used, and are almost guaranteed to produce the same results, give or take minuscule deviation.

In fact, as close as I can discern from reportage, even in Stein’s first state, Wisconsin, to perform a truly different full hand count analysis requires leave of a court. And it is hard to see leave of court being given without a substantive evidentiary basis being proffered, of which there is, of course, none to date. In Pennslyvania, the outlook is no better, and arguably even more lame and adverse. That is before we ever get to Michigan, which the last second for Stein is Wednesday.

There are a lot of truly intelligent and proper purposes for all Americans, and currently Democrats, to want to test and audit the vote in this country. It is that important, and that germane to our democracy.

By the same token, it is also too important to be driven by a crass vanity project at the last second by a bit player glomming on for self promotion. This is the lifeblood of American plebiscite and democracy, and we deserve better.

But the current action is not just a curiosity that “can’t hurt” or that is suddenly necessary to react to some idiotic tweet by Trump. The stakes are higher than that. Stein’s effort is ill advised, ill counseled legally, ill targeted, ill executed and ill timed by every metric I can see.

And, yes, there can be real harm therefrom. An effort like this that does nothing but confirm the general overall propriety of the 2016 vote does nothing but confirm Trump’s election. But, more importantly, it lends a larger argument that our voting system is fair and accurate, and thus not in need of further reform and updating.

Sure, it may, for the next few weeks, counter the blindered fascination of many as to rebutting Trump’s idiotic tweet on “millions of illegal voters”, but that is transient and short sighted. In the long run, it will just feed the larger GOP effort, and they now hold both houses of Congress and the Presidency, to not reform and improve American voting mechanisms, but indeed to accept that it is all fine technologically and then go about further voter suppression and restriction measures generally.

Greg Sargent discussed this at the Washington Post Plumline this morning:

Trump has now made national news with this tweet, a response to reports that Hillary Clinton’s campaign will join a recount effort in Wisconsin and possibly Michigan and Pennsylvania as well
….
As Glenn Kessler explains, there is zero evidence that this happened. Trump will continue to reach deep into the fever swamps to shape reality for himself and his supporters — only now he’ll do so in the position as most powerful person in the world. Trump also tweeted that there was “serious voter fraud” in three states that the media refuses to report upon.

But all this may also telegraph something concrete that we might see under a Trump presidency: A far more ambitious effort to restrict access to voting than we might have expected.

“My concern is that this might be a signal that we will see an assault on voting rights,” Wendy Weiser, the director of the Democracy Program at the Brennan Center for Justice, told me today. “Claims of nonexistent voter fraud and noncitizen voting are precisely the kinds of baseless justifications that we’ve seen for the wave of laws in the past couple of years restricting voting access.”

Yes, indeed. I think this is exactly what I am, and have been, saying. Well put by Sargent.

Democrats, and yes Greens to the extent they really care, should stop playing the game that is already lost, and 2016 is already lost, and start playing smartly as to the future. You want comprehensive and meaningful actual voting audits, as opposed to rote recounts, of the vote? Excellent! Let’s work on that for the future. Let’s do that for all states, and not just the three that Jill Stein glommed onto to self promote.

There is a fight out there to be won, but the instant “recount” effort is ill advised and not going to do squat to win it.

image_print