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Adam Schiff Makes Clear FBI Is Using Section 215 Like the 2014 Exception

For months, Congress has been debating the reauthorization of Section 215 of the PATRIOT Act. The House passed a compromise bill before COVID shut-downs really halted everything in Congress, though did so in such a way as to prevent Zoe Lofgren from offering any amendments. After the Senate failed to act, the provision (and two related ones lapsed). Then, a few weeks ago, the Senate passed a version that added an amendment from Mike Lee and Patrick Leahy that strengthened the amicus to the previously passed House bill. But an amendment offered by Ron Wyden and Steve Daines failed by one vote after Tom Carper said that Pelosi had warned him its passage would gut FISA (and after Bernie Sanders and Patty Murray didn’t make it for the vote). The operative language of their amendment read,

(C) An application under paragraph (1) may not seek an order authorizing or requiring the production of internet website browsing information or internet search history information.

Zoe Lofgren and Warren Davidson tried to pass that amendment in the House. Over a weekend of heated negotiations, they limited the Wyden-Daines language to apply just to US persons.

(C) An application under paragraph (1) may not seek an order authorizing or requiring the production of internet website browsing information or internet search history information of United States persons.

At first, Wyden endorsed the Lofgren-Davidson language. Except then Adam Schiff gave Charlie Savage a statement that suggested the amendment would only prevent the government from seeking to obtain Americans’ internet information, not prevent it altogether.

But in his own statement, Mr. Schiff put forward a narrower emphasis. Stressing the continued need to investigate foreign threats, he described the compromise as banning the use of such orders “to seek to obtain” an American’s internet information.

That led Ron Wyden to withdraw his support. Leadership withdrew that amendment from the Rule.

Schiff’s ploy seems to suggest one way the government is using Section 215.

Wyden had previously asked how each of three applications for Section 215 would appear in counts:

  • An order in which an IP address used by multiple people is the target
  • An order collecting all the people who visit a particular website
  • An order collecting all the web browsing and internet searches of a single user

I’ve argued in the past that the FBI wouldn’t go to the trouble of a Section 215 order for a person who was not otherwise targeted, the last bullet. Schiff’s willingness to limit collection to foreigners is consistent with that (because targeting non-US persons has a lower probable cause level), meaning that’s not the function the government is so intent on preserving.

Which leaves Wyden’s IP address used by multiple people and a website, what I have suggested might be VPNs and WikiLeaks. Those are the applications that Schiff (and Pelosi) are going to the mat to protect.

That makes something that happened in 2014 important. That year, FISC permitted the government to remain tasked on a selector under 702 (which can only target foreigners) even after finding that Americans were using the selector, provided the US person content was purged after the fact. Except ODNI made a list of enumerated crimes — virtually all of which exploit the Dark Web — that Section 702 content could be used to prosecute. Richard Burr codified that principle when the law was reauthorized in 2017.

Schiff has invoked the same principle — allowing the FBI to target a URL or IP, and in the name of obtaining foreign intelligence, obtaining the US person activity as well. Because this is not treated as “content,” the government may not be limited to instances where the US person activity is location obscured (though it’s possible this is just about obtaining VPN traffic, and not something like WikiLeaks).

Wyden called the resulting practice (remember, this is status quo), as “dragnet surveillance.”

“It is now clear that there is no agreement with the House Intelligence Committee to enact true protections for Americans’ rights against dragnet collection of online activity, which is why I must oppose this amendment, along with the underlying bill, and urge the House to vote on the original Wyden-Daines amendment,” Wyden said.

So once again — still — the government is using a foreign targeted law to obtain leads of Americans to investigate. That, apparently, is what Pelosi considers the key part of FISA: honey pots to identify Americans to investigate.

Meanwhile, DOJ doesn’t even like the changes Lee and Leahy implemented, falsely claiming that the law — which requires DOJ to meet the standards laid out voluntarily by FBI’s response to the DOJ IG Report — does nothing to address the problems identified by the IG Report.

The Department worked closely with House leaders on both sides of the aisle to draft legislation to reauthorize three national security authorities in the U.S.A. Freedom Act while also imposing reforms to other aspects of FISA designed to address issues identified by the DOJ Inspector General. Although that legislation was approved with a large, bipartisan House majority, the Senate thereafter made significant changes that the Department opposed because they would unacceptably impair our ability to pursue terrorists and spies. We have proposed specific fixes to the most significant problems created by the changes the Senate made. Instead of addressing those issues, the House is now poised to further amend the legislation in a manner that will weaken national security tools while doing nothing to address the abuses identified by the DOJ Inspector General.

Accordingly, the Department opposes the Senate-passed bill in its current form and also opposes the Lofgren amendment in the House. Given the cumulative negative effect of these legislative changes on the Department’s ability to identify and track terrorists and spies, the Department must oppose the legislation now under consideration in the House. If passed, the Attorney General would recommend that the President veto the legislation.

Trump, meanwhile, is opposing the bill because it doesn’t go far enough.

WARRANTLESS SURVEILLANCE OF AMERICANS IS WRONG!

Republicans are inventing reasons to oppose it after supporting it in March.

Back in March, Billy Barr said he could do what he needed to with EO 12333. It’s unclear how he’d coerce providers.

But Schiff’s efforts to defeat Wyden make it clear this is a function designed to identify Americans.

Update: I had thought a current vote was on FISA, but is on China sanctions, so I’ve deleted.

Ron Wyden Hints at How the Intelligence Community Hides Its Web Tracking Under Section 215

Ron Wyden had an amendment to Section 215 that would have limited the use of that provision to obtain web traffic information that fell one vote short in the Senate, partly because Nancy Pelosi whipped Tom Carper against it and partly because two Senators (Bernie Sanders and Patty Murray) didn’t get back for a vote. In an effort to resuscitate the amendment in the House under Zoe Lofgren and Warren Davidson’s leadership (which would surely pass if Section 215 got bounced back to the Senate), Ron Wyden released a letter to Ric Grenell trying to force some transparency about how the IC hides the scope of the use of Section 215 to get web search and Internet traffic information.

The letter asks Grenell to explain how Section 215 orders served on IP addresses, rather than email addresses, might get counted in transparency provisions.

How would the government apply the public reporting requirements for Section 215 to web browsing and internet searches? In this context, would the target or “unique identifier” be an IP address?

If the target or “unique identifier” is an IP address, would the government differentiate among multiple individuals using the same IP address, such as family members and roommates using the same Wi-Fi network, or could numerous users appear as a single target or “unique identifier”?

If the government were to collect web browsing information about everyone who visited a particular website, would those visitors be considered targets or “unique identifiers” for purposes of the public reporting? Would the public reporting data capture every internet user whose access to that website was collected by the government?

If the government were to collect web browsing and internet searches associated with a single user, would the public reporting requirement capture the scope of the collection? In other words, how would the public reporting requirement distinguish between the government collecting information about a single visit to a website or a single search by one person and a month or a year of a person’s internet use?

Wyden here lays out three use cases for how the IC might (one should assume does) use Section 215 to get web traffic.

  • An order in which an IP address used by multiple people is the target
  • An order collecting all the people who visit a particular website
  • An order collecting all the web browsing and internet searches of a single user

The government is required to report:

(5)the total number of orders issued pursuant to applications made under section 1861(b)(2)(B) of this title and a good faith estimate of—

(A)the number of targets of such orders; and

(B)the number of unique identifiers used to communicate information collected pursuant to such orders;

Taking each of his three scenarios, here’s what I believe the government would report.

An order in which an IP address used by multiple people is the target

In the first scenario, the government is trying to obtain everyone who “uses” a particular IP address. The scenario laid out by Wyden is a WiFi router used by family or friends, but both because the House Report prohibited such things in 2015 and because DOJ IG has raised questions about targeting everyone who uses a Friends and Family plan, I doubt that’s what the IC really does.

Rather, I suspect this is about VPNs and other servers that facilitate operational security. The government could hypothetically obtain four orders a year getting “VPNs,” requiring providers of each of the 10 major VPNs in the country to provide the IP addresses of all the incoming traffic, which would show the IP addresses of everyone who was using their location obscuring traffic.

In such a case, the targeted VPN IP addresses wouldn’t be communicating information at all. The users would get no information back. Therefore, the IC would only report the number of targets of such orders. If the “target” were defined as VPN, the number would be reported as 4 (for each of the 4 orders); if the “target” were defined as the specific VPN providers, the number of targets would be reported as 10.

The IC would entirely hide the number of individual Americans affected.

An order collecting all the people who visit a particular website

This application would seek to learn who visited a particular website. The classic case would be Inspire magazine, the AQAP propaganda. But I could also see how the IC might want to collect people who visit WikiLeaks’ submission page, or any number of sites that would offer information of interest to foreign spies (even DNI’s report on surveillance collection!). In such a use case, the government might ask not for the information provided to the user, but instead the incoming IP addresses of every request to the website. Again, this would not reflect a communication of information (and certainly not to the end user), so would not be reported under 5B.

If the targets were defined as “AQAP propaganda sites,” Inspire and all its affiliates might be reported as just one target (or might even be counted on a more generalized 215 order targeting AQAP or WikiLeaks, and so not as a unique 215 order at all).

The end users here would, again, not be counted if the collection request deliberately asked for something that did not “communicate information,” though I’m not sure precisely what technical language the government would use to accomplish this.

An order collecting all the web browsing and internet searches of a single user

This use case would ask how a 215 order targeting an individualized target (like Carter Page) shows up in transparency reports. If this were an order served on Google targeting a single account identifier for Google (say, Page’s Gmail account), the government might treat that Gmail identifier as the unique identifier, even though the government was getting information on every time this unique identifier obtained information.

Even in the criminal context, prosecutors don’t always target Google histories (for example, they did not with Joshua Schulte, and so got Google searches going back to before he joined the CIA). In the intelligence context, the FBI is given even more leeway to obtain everything, based off the logic that it’s harder to find clandestine activity.

In other words, Wyden has pointed to three use cases, all of which the IC is surely using, which existing transparency reporting requirements would entirely obscure the impact of.

The Kinds and Significance of Russian Interference — 2016 and 2020

Trump’s meltdown last week — in which he purged top staffers at the Director of National Intelligence after a briefing on Russian interference in the 2020 election, followed by National Security Advisor Robert O’Brien making shit up on Meet the Press — has created a firestorm about Russian interference in the 2020 election. That firestorm, however, has spun free of what ways Russia interfered in 2016 and what effect it had.

Five ways Russia interfered in 2016

First, remember that there were at least five ways Russia interfered in 2016:

  • Stealing information then releasing it in a way that treats it as dirt
  • Creating on-going security challenges for Hillary
  • Using trolls to magnify divisions and feed disinformation
  • Tampering with the voting infrastructure
  • Influence peddling and/or attempting to recruit Trump aides for policy benefits

Stealing information then releasing it in a way that treats it as dirt

The most obvious way Russia interfered in 2016 was by hacking the DNC, DCCC, and John Podesta (it also hacked some Republicans it did not like). It released both the DNC and Podesta data in such a way as to exaggerate any derogatory information in the releases, successfully distracting the press for much of the campaign and focusing attention on Hillary rather than Trump. It released DCCC information that was of some use for Republican candidates.

Roger Stone took steps — not all of which are public yet — to optimize this effort. In the wake of Stone’s efforts, he moved to pay off one participant in this effort by trying to get a pardon for Julian Assange.

Creating on-going security challenges for Hillary

In addition to creating a messaging problem, the hack-and-leak campaign created ongoing security challenges for Hillary. Someone who played a key role in InfoSec on the campaign has described the Russian effort as a series of waves of attacks. The GRU indictment describes one of those waves — the efforts to hack Hillary’s personal server — which came in seeming response to Trump’s “Russia are you listening” comment. An attack that is often forgotten, and from a data perspective was likely one of the most dangerous, involved a month-long effort to obtain Hillary’s analytics from the campaign’s AWS server.

Whatever happened with this data, the persistence of these attacks created additional problems for Hillary, as her staff had to spend time playing whack-a-mole with Russian hackers rather than optimizing their campaign efforts.

Using trolls to magnify divisions and feed disinformation

Putin’s “chef,” Yevgeniy Prigozhin, also had staffers from his troll factory in St. Petersburg shift an ongoing campaign that attempted to sow division in the US to adopt a specific campaign focus, pushing Trump and attacking Hillary. Importantly, Prigozhin’s US-based troll effort was part of a larger multinational effort. And it was in no way the only disinformation and trolling entity involved in the election. Both parties did some of this, other countries did some, and mercenaries trying to exploit social media algorithms for profit did some as well.

Tampering with the voting infrastructure

Russia also tampered with US voting infrastructure. In 2016, this consisted of probing most states and accessing voter rolls in at least two, though there’s no evidence that Russian hackers made any changes. In addition, Russian hackers targeted a vendor that provided polling books, with uncertain results. The most substantive evidence of possible success affecting the vote in 2016 involved failures of polling books in Durham County, NC, which created a real slowdown in voting in one of the state’s most Democratic areas.

In recent days, there have been reports of a ransomware attack hitting Palm Beach County in September 2016, but it is unclear whether this was part of the Russian effort.

Because there’s no certainty whether the Russian hack of VR Systems was behind the Durham County problems, there’s no proof that any of these efforts affected the outcome. But they point to the easiest way to use hacking to do so: by making it harder for voters in particular areas to vote and harder for specific localities to count the vote.

Some of what Russia did in 2016 — such as probes of a particularly conservative county in FL — may have been part of Russia’s effort to discredit the outcome. They didn’t fully deploy this effort because Trump won.

Influence peddling and/or attempting to recruit Trump aides for policy benefits

Finally, Russia accompanied its other efforts with various kinds of influence peddling targeting Trump’s aides. It was not the only country that did so: Saudi Arabia, Egypt, Turkey, UAE, and Israel were some of the others. Foreign countries were similarly trying to target Hillary’s campaign — and the UAE effort, at least, targeted both campaigns at once, through George Nader.

Importantly, however, these efforts intersected with Russia’s other efforts to interfere in the election in ways that tied specific policy outcomes to Russia’s interference:

  • An unrealistically lucrative Trump Tower deal involved a former GRU officer and sanctioned banks
  • At a meeting convened to offer Trump dirt about Hillary, Don Jr agreed in principle to revisit ending Magnitsky sanctions if Trump won
  • George Papadopoulos pitched ending sanctions to Joseph Mifsud, who had alerted him that Russia had emails they intended to drop to help Trump
  • Paul Manafort had a meeting that tied winning the Rust Belt, carving up Ukraine, and getting paid personally together; the meeting took place against the background of sharing internal polling data throughout the campaign

As I’ll note in a follow-up, information coming out in FOIAed 302s makes it clear that Mike Flynn’s effort to undercut Obama’s December 2016 sanctions was more systematic than the Mueller Report concludes. So not only did Russia make it clear it wanted sanctions relief, Trump moved to give it to them even before he got elected (and his Administration found a way to exempt Oleg Deripaska from some of these sanctions).

Manafort continued to pursue efforts to carve up Ukraine until he went to jail. In addition, Trump continues to take actions that undercut Ukraine’s efforts to fight Russia and corruption. Neither of these have been tied to a specific quid pro quo (though the investigation into Manafort’s actions, especially, remained inconclusive at the time of the Mueller Report).

So while none of these was charged as a quid pro quo or a conspiracy (and the reasons why they weren’t vary; Manafort lied about what he was doing, and why, whereas Mueller couldn’t prove Don Jr had the mens rea of entering into a quid pro quo), Russia tied certain policy outcomes to its interference.

Trump’s narcissism and legal exposure exacerbated the effects

The Russian attack was more effective than it otherwise would have been for two reasons. First, because he’s a narcissist and because Russia built in plausible deniability, Trump refused to admit that Russia did try to help him. Indeed, he clings more and more to Russian disinformation about what happened, leading the IC to refuse to brief him on the threat, leading to last week’s meltdown.

In addition, rather than let FBI investigate the people who had entered into discussions of a quid pro quo, Trump obstructed the investigation. Trump has spent years now attacking the rule of law and institutions of government rather than admit what DOJ IG found — there was reason to open the investigation, or admit what DOJ found — there was reason to prosecute six of his aides for lying about what happened.

The Russian effort was just one of the reasons Hillary lost

It’s also important to remember that Russia’s interference was just one of the many things that contributed to Hillary’s loss.

Other aspects were probably more important. For example, Republican voter suppression, particularly in Wisconsin and North Carolina, was far more important than any effect the VR Systems hack may have had in Durham County. Jim Comey’s public statements about the email investigation had at least as much effect as the Russian hack-and-leak campaign did on press focus. Hillary made some boneheaded choices — like barely campaigning in WI and MI; while I had worried that she made those choices because Russia tampered with her analytics (with the AWS hack), that doesn’t seem to have happened. Disinformation sent by the Trump campaign and associates was more significant than Russian disinformation. It didn’t help that the Obama Administration announced a sharp spike in ObamaCare prices right before the election.

The response matters

As noted, Trump’s narcissism dramatically increased the effect of the Russian efforts in 2016, because he has always refused to admit it happened.

Compare that to Bernie’s response to learning that Russia was trying to help his campaign, which accepted that it is happening and rejected the help.

“I don’t care, frankly, who [Russian President Vladimir] Putin wants to be president,” Sanders said in a statement. “My message to Putin is clear: Stay out of American elections, and as president I will make sure that you do.

“In 2016, Russia used Internet propaganda to sow division in our country, and my understanding is that they are doing it again in 2020. Some of the ugly stuff on the Internet attributed to our campaign may well not be coming from real supporters.”

This was not perfect — Bernie could have revealed this briefing himself weeks ago, Bernie blamed the WaPo for reporting it when it seems like the story was seeded by O’Brien. But it was very good, in that it highlighted the point of Russian interference — sowing divisions — and it reaffirmed the import of Americans selecting who wins. Plus, contrary to Trump, there’s no reason to believe Bernie would pursue policies that specifically advantaged Russia.

Other factors remain more important than Russian interference

There’s very serious reason to be concerned that Russia will hack the outcome of 2020. After all, it would need only to affect the outcome in a small number of precincts to tip the result, and the prospect of power outages or ransomware doing so in urgent fashion have grown since 2016.

That said, as with 2016, there are far more urgent concerns, and those concerns are entirely American.

Republicans continue to seek out new ways to suppress the vote, including by throwing large swaths of voters off the rolls without adequate vetting. There are real concerns about voting machines, particularly in Georgia (and there are credible concerns about the reliability of GA’s tally in past elections). Republicans have continued to make polling locations less accessible in Democratic precincts than in Republican ones.

Facebook refuses to police the accuracy of political ads, and Trump has flooded Facebook with disinformation.

And Bloomberg’s efforts this year — which include a good deal of trolling and disinformation — are unprecedented in recent memory. His ad spending has undercut the ability to weigh candidates. And his personnel spending is increasing the costs for other candidates.

Russian efforts to sway the vote are real. Denying them — as some of Bernie’s supporters are doing in ways that hurt the candidate — does not help. But, assuming DHS continues to work with localities to ensure the integrity of voting infrastructure, neither does overplaying them. Between now and November there’s far more reason to be concerned about American-funded disinformation and American money distorting our democratic process.

Biden’s Opposition to Medicare for All: It’s All About the Billionaires, Baby

[Editor’s Note – this is a guest post by a friend of ours here at the Emptywheel Blog, Bob Lord. Bob is a longtime tax and finance attorney with some very salient thoughts on why the centrist Democrats are pushing back so hard on Medicare For All. One other note, we here at Emptywheel have purposefully not engaged on behalf of any particular candidate in the primary process, but the issues in play are fair game.]

By Robert J. Lord

Joe Biden has lots of reasons why he opposes the Medicare for All plan favored by Bernie Sanders and Elizabeth Warren.

The cost runs too high, the former vice-president tells us. People will have to give up their private health insurance. People will lose the right to choose their health insurance provider.

The list goes on, but do these reasons reflect Biden’s actual worries? Surely, he’s seen the studies that show Medicare for All would drive costs down, not up, as removing health insurance company profits and administrative costs from American health care totally changes the system’s accounting dynamics. Yes, an expanded Medicare would require administrative expenses, but nowhere close to the expenses that our current system requires.

Biden also knows Americans would welcome the chance to swap their private health insurance for Medicare. Don’t believe me? Speak to someone between the ages of 60 and 64 who’s relatively healthy. Ten to one she has her fingers crossed hoping to make it to age 65 without a major health challenge, so she can qualify for Medicare and never have to confront the insufficiency of her wonderful private insurance plan.

And very few Americans, we must keep in mind, choose their health insurance provider. Most of us get insurance through our employers. Employers choose the least expensive plan for all employees collectively, without regard to the needs and desires of individuals.

Given that Joe Biden’s stated reasons for opposing Medicare for All don’t pass the smell test, what could be the real reason for his opposition?

Could Biden simply be beholden to the health insurance industry and Big Pharma? Perhaps, but I suspect that something larger — the overall wealth of our wealthy — may be at play. After all, it’s not like health insurers and pharmaceutical companies are going to have his back come general election time.

Consider the difference between how Joe Biden, on the one hand, and Bernie Sanders and Elizabeth Warren, on the other, view the billionaires and centimillionaires who make up America’s super rich. Sanders believes the greed of America’s billionaire class threatens the social fabric of our country and has proposed a significant increase in the federal estate tax on grand fortunes. Warren has proposed a 2 percent annual wealth tax on all fortunes in excess of $50 million.

Biden’s differences with Warren and Sanders go deep. He has assured his rich donors — at big-dollar fundraising events — that their lifestyles will not change if he’s elected. Biden, whose donor list includes at least 13 ten-digit fortunes, has made it clear that he doesn’t think billionaires bear any more responsibility for America’s woes than any of the rest of us.

Just this week, he voiced his opposition to policies that would make it harder to become a billionaire.

But why would billionaires and centimillionaires particularly care whether we have Medicare for All versus the Obamacare-with-a-public-option plan Biden favors?

To answer that question, consider the fundamental difference between Obamacare and Medicare for All: who pays. Under Obamacare, individuals pay for their health care, through the insurance premiums they pay and their out-of-pocket expenses for the charges their insurance policies don’t cover. The government subsidizes insurance for lower income Americans through Medicaid, but the bulk of health insurance costs are paid by individuals or their employers.

The public option, Biden’s proposed fix to Obamacare, won’t change any of this. Even if every American healthcare consumer chose the public option, putting the private health insurance industry out of business in the process, individuals still would be responsible for their own health care costs.

Medicare works differently. Under Medicare, the government insures healthcare costs directly. Individuals don’t pay premiums or co-pays. Instead, tax dollars fund the cost of the program.

All this means that the transition from Obamacare to Medicare for All would transfer the burden of health care costs from health care consumers, who share in costs based on how sick or healthy they happen to be, to taxpayers, who would share in costs based on their respective incomes and tax rates.

The great majority of Americans live their lives as both health care consumers and taxpayers. Under Medicare for All, they would see an elimination of both insurance premiums and out-of-pocket medical costs. They would also see a tax increase, but ordinary Americans would save substantially more in health care costs than they’d pay in increased taxes.

But those billionaires and centimillionaires on Joe Biden’s donor list? Their tax increases would dwarf any savings they see in personal healthcare expense. Some could see seven figure tax increases.

Viewed through the billionaire lens, Biden’s loud opposition to Medicare for All makes distinct political sense. He needs billionaires to fund his White House aspirations, which still drive him three decades out from his first presidential run in 1988. He’s not only convinced himself that his billionaire supporters pose no threat to our social fabric, he even seems to believe that any health care reform that puts the squeeze on billionaire fortunes does pose a threat.

All in all, a classic case of why ambition often blinds us. In a 2018 speech, just a sentence or two after saying the billionaires he’s courting aren’t a problem, Biden lamented that the income gap in America is yawning.

What Biden’s ambition won’t let him see: Billionaires don’t exist in isolation. We have approximately 700 billionaires today in the United States. We have a larger number of half-billionaires and a still larger deep-pocket cohort of centimillionaires. And so on. Which leaves our top 1 percent controlling close to half the country’s wealth and the country with an income gap that Biden openly recognizes is “yawning” and, obviously, a problem.

In other words, those billionaires Biden’s won’t let himself see as a worry really are inseparable from the yawning income gap that he knows is a problem.

Sanders and Warren, by comparison, are clear-eyed. They can see that when the gap is so yawning that treatable or preventable injuries and illnesses are killing Americans who can’t afford healthcare and bankrupting millions of others, the only answer is that society — through taxation — must assume the cost of healthcare. Other countries, like Canada, recognized this reality decades ago.

And when America’s billionaires, with Joe Biden as one of their many mouthpieces, stand in the way of that process because they don’t want their taxes to increase, their greed tears at the fabric of American society.

Joe Biden can’t see that. His two leading rivals sure do.

[Robert J. Lord, a tax lawyer and former Congressional candidate, is an associate fellow at the Institute for Policy Studies. Bob previously served as an adjunct faculty member at the Arizona State University School of Law. Bob’s work focuses on the relationship of tax law to inequality. He contributes to both the Inequality.org website and to OtherWords, the Institute’s national syndicated editorial service. Bob also is a staff member at Blog For Arizona, the leading political blog in Arizona.]

Craig Murray’s Description of WikiLeaks’ Sources

One of the weaknesses of my post on the evidence needed to prove the Russian DNC hack (one I’ll fix when I move it into a page) is that I didn’t include a step where the intelligence community had to dismiss alternative theories. It is not enough to prove that tools associated with Russian intelligence hacked the DNC (whether or not you’re convinced they necessarily are used exclusively by GRU), but you also have to prove that no one else either hacked the known sources of leaked documents or otherwise obtained them. That was particularly important given early reports that FBI wasn’t sure that the documents stolen by hackers presumed to be GRU were the same documents dealt to WikiLeaks.

One alternative theory I know some researchers tested, for example, is whether hackers could have gotten into the accounts of DNC staffers by testing passwords made available by past hacks (of LinkedIn and MySpace, in particular) for reuse. For a while, that definitely seemed like a plausible alternative theory, but ultimately I don’t think it could explain the known evidence.

The most important alternative theory, however, comes from Julian Assange, who has been first intimating and more recently asserting directly that Russians were not his source (even while showing immediate concern that Obama’s hacking review targeted Wikileaks directly). Former UK Ambassador to Uzbekistan Craig Murray has also made such a claim, first in a series of posts on his blog, and at more length in an interview with Scott Horton.

Murray’s interview is well worth the listen, as he has nowhere near the same personal stakes in this story as Assange and — as he makes clear in the interview — because he seems to have had a role in handing over the second batch of emails. Ultimately, his description is unconvincing. But it is an important indication of what he claims to believe (which must reflect what Assange has told him, whether Assange believes it or not). Importantly, Murray admits that “It’s perfectly possible that WikiLeaks themselves don’t know what is going on,” which admits one possibility I’ve always suspected: that whoever dealt the documents did so in a way that credibly obscured their source.

Murray explained that the two sets of documents handed over to Wikileaks came via two different American sources, both of whom had legal access to them.

He describes a lot more about the Podesta emails, of which he said he had “first hand knowledge,” because of something he did or learned on a trip to DC in September. In this interview, he says “The material was already, I think, safely with WikiLeaks before I got there in September,” though other outlets have suggested (with maps included!) that’s when the hand-off happened. In that account, Murray admits he did not meet with the person with legal access; he instead met with an intermediary. That means the intermediary may have made false claims about the provenance.

And even the claims about the provenance don’t make sense. Murray claimed the documents came from someone in the national security establishment, and implied they had come from legal monitoring of John Podesta because he (meaning John) is a lobbyist for Saudi Arabia.

Again, the key point to remember, in answering that question, is that the DNC leak and the Podesta leak are two different things and the answer is very probably not going to be the same in both cases. I also want you to consider that John Podesta was a paid lobbyist for the Saudi government — that’s open and declared, it’s not secret or a leak in a sense. John Podesta was paid a very substantial sum every month by the Saudi government to lobby for their interests in Washington. And if the American security services were not watching the communications of the Saudi government paid lobbyist then the American intelligence services would not be doing their job. Of course it’s also true that the Saudis’ man, the Saudis’ lobbyist in Washington, his communications are going to be of interest to a great many other intelligence services as well.

As a threshold matter, no national security agency is going to monitor an American registered to work as an agent for the Saudis. That’s all the more true if the agent has the last name Podesta.

But that brings us to another problem. John Podesta isn’t the lobbyist here. His brother Tony is. So even assuming the FBI was collecting all the emails of registered agent for the Saudis, Tony Podesta, even assuming someone in national security wanted to blow that collection by revealing it via Wikileaks, they would pick up just a tiny fraction of John Podesta’s emails. So this doesn’t explain the source of the emails at all.

But if we believe that Murray believes this, we know that the intermediary can credibly claim to have ties to American national security.

Horton and Murray go on to discuss how WikiLeaks got the first batch of emails, the ones from DNC. That’s specifically the context where Murray talks about the possibility Assange doesn’t actually know. Though he suggests the leaker is a DNC insider angry about Bernie Sanders’ treatment.

There’s a section on the murdered DNC staffer, which I’m not going to focus on because I find it distasteful. But Murray explains that Assange offered a reward pertaining to his murder because he thought the staffer might be mistaken for the real source, but was not the real source. Which suggests Assange implied to Murray that the documents were directly leaked by someone in a similar position. Again, someone who could pose as a DNC staffer.

Here, Murray states clearly that “Guccifer is not the source for WikiLeaks.” He explains that claim based primarily off the assumption that the Russians would never employ such as buffoon as Guccifer, not direct knowledge. Remember Guccifer stated publicly he had given the documents to WikiLeaks, with no rebuttal from Assange I know of.

In other words, that doesn’t seem to make sense either. And with Assange you are by necessity dealing with documents passed through at least one and in the Podesta email case, perhaps two or more intermediaries. So even assuming the best effort to vet people on Assange’s side, he does have limited resources to do so himself.

One more comment. Murray ends with a description of the reception of the emails that doesn’t make sense at all. He suggests the “mainstream media” ignored concerns about the Clinton foundation (he doesn’t even mention that this coverage might come from the legally FOIAed emails). He says they ignored other details, such as that Donna Brazile gave Hillary a debate question and that the DNC conspired against Bernie. He claims members of the media “colluded” with the Hillary campaign.

I know some people believe these topics should have gotten more attention. Even if you believe these things, though, believing the traditional media didn’t cover them requires a blind spot about the massive Trump corruption they might have been covering instead.

All that neither proves or disproves that Murray believes he got documents from someone in the national security establishment that were legally obtained. It just might explain why he’d believe something that, in this case, makes no sense.

Update: Now Assange is saying his source wasn’t Guccifer. He also snipes about Murray’s comments.

“Craig Murray is not authorized to talk on behalf of WikiLeaks,” Assange said sternly.

 

Our Industrial Policy Is the F-35

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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.

Surrogating the 2016 American Presidency

Tonight was the opening of the Democratic National Convention. It was a rather stunning difference from the scenes on the street yesterday and today, where there were minimal and well behaved cops in Philly as contrasted with the warrior cop oppressive stormtrooper presence in Cleveland. From my reporter friends from the Arizona Republic, the food is totally better in Philly too. Hey, armies move on food, and cheesesteaks rule.

Is everything coming up roses? Nope. There was the whole Debbie Wasserman Schultz thing. She was well advised by our friend David Dayen to stay away and excommunicate herself from the convention podium. But, crikey, the rest simply looks beautiful. Sanders supporters marching in the streets for change, mostly unfettered and unoppressed, other voices being heard, and all relative delegates meeting and co-existing in the halls. This ain’t the dysfunctional RNC bigoted shit show. That, in and of itself, would be worth this post. There is more.

Don’t let cable coverage and the relentless yammer of their panels of self interested toadies fool you, the few true camera pans at the RNC showed more than a few empty seats and a far smaller crowd (especially in the upper decks) than displayed tonight at the DNC.

The real tell, in difference, was in the quality of the speakers and presentation. The only lasting memory from the RNC’s opening night was the embarrassing plagiarism in Melania Trump’s speech. Honestly, my bet is that is not on her, but the understaffed and idiot handlers her narcissistic, yet bumbling, husband provided. That said, it was a res ipsa loquitur deal and, in the end, spoke for itself. What else do you remember from that night other than Tim Tebow did not appear? I got nuthin.

The first night of the DNC in Philly, however, came with a litany of decent and well presented folks presented to a full and energetic hall. Emphasis on full. The dynamics in staging and presentation were stark. As were the quality and mental coherence of the speakers. The first electric moment came when Sarah Silverman, who along with Al Franken, was doing a bit and intro to Paul Simon singing (a geriatric, albeit mesmerizing) Bridge Over Troubled Water. Silverman and Franken had to kill an extra 120 seconds or so and she blurted out some hard, and real, truth that her fellow Bernie Sanders supporters who refuse to help Clinton defeat Trump are flat out “being ridiculous”. Truer words have never been spoken.

But soon came Michelle Obama to the podium. I am not sure I have the words to describe how good Michelle was. As a convention speaker, a surrogate, a leader, a mother and as a First Lady embodying all of the above. Michelle Obama killed it. She blew the joint up. I don’t know how else to describe it, but if you did not witness it live, watch the video up at top. Just do it.

Frankly, at the conclusion of Michelle Obama’s speech, it was hard to see how the last two key speakers, Elizabeth Warren and Bernie Sanders, could possibly top the moment. Sadly, they could not. Liz Warren gave a great, and often in depth, speech. One that absolutely slayed Donald Trump in nearly every way. On its own, it would have been noteworthy. But sandwiched between the brilliance of Michelle Obama and Sanders, with his acolytes cheering and hers still reeling, it seemed good, but not great.

Bernie Sanders caught a little more fire, but mostly because of his yuuge contingent of supporters. And that is not just a good thing, it is a great thing. Sanders did everything, and more, he should have done in this speech by ginning up the classic points and issues his campaign, and its followers, were built on…and then transferring them to Clinton.

It did not work perfectly, but this will be a process up until the election date on November 8. Bernie went a long way, gracefully and patiently, tonight. And, while the cheering crowd appeared to be much more than just the “Sandernistas”, all of the hall seemed to get on board. That, along with Sarah Siverman telling holdout Bernie Busters to wake up and not be ridiculous, were giant steps in unifying support for Clinton over Trump.

Listen, I have been around the block a few times, and know I am supposed to lead with the headline. Sorry, this one worked up to it, and here it is. The RNC and Trump got their lousy bounce because the media, once again, cravenly portrayed what happened in Cleveland as normal, and tit for tat, with what is happening, and will happen, in Philadelphia. That is simply a ratings and craven click germinated lie. The difference is stark.

Nowhere is it more stark than in the picture painted as to the surrogates who will come out of the respective conventions to campaign for their respective candidate between now and November 8.

Um, let’s see, for the GOP we have Newt, Carson, Melania, Thiel, Flynn, Joe Arpaio and Chachi Baio. I excluded Ivanka because she might actually be competent. Seriously, that is basically it for Trump surrogates. From the whole convention. Even Clint Eastwood’s chair took a pass in this, the year of the Orange Faced Short Fingered Vulgarian Bigot.

Let’s compare that with what came out of the Democratic Convention’s first night. Sarah Silverman, Al Franken, Paul Simon, Eva Longoria, Corey Booker and, then, the big three…Michelle Obama, Liz Warren and Bernie Sanders. That is just the first night folks.

See a bit of a dichotomy in personality and credibility there?

Then picture that Clinton’s road warrior surrogates will include not just the above, but also Joe Biden, President Barack Obama and the Big Dog himself, Bill Clinton.

Elections are won in the trenches. Say what you will about Hillary Clinton, and I will probably join you on many negatives, but the Clintons do have a ground operation. And their surrogates are like the 1927 Yankees compared to the Bad News Bears for Trump and the RNC. How will Trump bolster his bench, by bringing in Roger Ailes to molest the women of America? Is there another ground plan for the Trump Juggalos?

Sure, Clinton can still muck it up and lose. She, and the DNC, have been beyond pathetic in how they have treated nearly half their party, and much of their activist base, during the primaries and aftermath. Not just ugly, but stupid. They deserve any hell they get for that, whether it comes from appropriately enraged Sanders supporters or from press reporting on hacks (THE RUSSIANS ARE COMING, THE RUSSIANS ARE COMING!!!)

Bottom line is this: Which set of surrogates would you think would do a better job spreading out over the country: Crazy Newt, Racist Flynn, Bigot Arpaio and Chachi, …. or Michelle Obama, Liz Warren, Bernie Sanders, Barack Obama and Joe Biden?

Think I will go with the latter, and I think they will reach a heck of a lot more voters who will actually engage than will the trite and petty bigots Trump will have on the public offer.

And the Dems have a laundry list of other quality surrogates who will stand up. Trump has apparent Klan worthy members like Jeff Sessions, felons like Don King and Mike Tyson, and people who seek to be them.

Who you gonna call when it comes time to vote?

Seems like an easy decision, especially when you consider that the next 30 to 35 years of ideological control of the Supreme Court hang in the balance.

TPP and Democratic Self-Delusion

After months of telling Bernie Sanders to drop out, the political chatterers are finally understanding one reason he did not do so: to maintain leverage over things like the party platform. After the platform was finalized yesterday, Bernie declared victory.

Pressed by supporters of U.S. Sen. Bernie Sanders, Democratic Party platform writers meeting this weekend in Orlando, Florida, adopted a progressive agenda that underscores the need for bold action on climate change, addresses criminal justice reform and calls for doubling the federal minimum wage.

“We have made enormous strides,” Sanders said. “Thanks to the millions of people across the country who got involved in the political process – many for the first time – we now have the most progressive platform in the history of the Democratic Party.”

The Platform Committee also adopted an amendment focused on criminal justice reform which calls for an investigation by the Department of Justice to investigate all shootings involving police officers.

The platform that will be submitted at the Democratic National Convention later this month in Philadelphia also would support Congress putting a price on carbon and methane to discourage continued use of fossil fuels that are causing severe climate change. The platform also says lawmakers must consider the impact on the climate in all federal decisions and invest heavily in wind and solar power rather than natural gas.

Delegates allied with Hillary Clinton’s and Sanders’ campaigns also passed amendments to fight for a $15 federal minimum wage tied to inflation, urged passage of progressive immigration reform and called for legalization of marijuana.

There were three issues, however, where Sanders’ delegates lost: opposition to Israeli settlements, a ban on fracking, and opposition to the Trans-Pacific Partnership.

The first two make sense: after all, those policy positions match Hillary’s stated position (though the US is supposed to be opposed to illegal settlements), so rejecting Sanders’ amendments equated to backing the nominee instead. That’s the way it’s supposed to work.

But Hillary, of course, claimed to oppose the TPP during the primary, even if that claim was always sketchy coming as it did as she worked so hard to negotiate the crappy deal as Secretary of State. So the mealy-mouthed language in the platform about protecting workers — akin to the same language in the Colombia Trade Deal that did squat to protect workers — is more notable.

As is the idiotic opinion expressed by this person, described by Robert Reich as an acquaintance from the Clinton White House.

ACQUAINTANCE: “Don’t you think your blog post from last night was a bit harsh?”

ME: “Not at all. The Democratic Party is shooting itself in the foot by not officially opposing the Trans Pacific Partnership.”

[They talk about how the Democrats are supporting this to back the President.]

ME: “But it’s terrible policy. And it’s awful politics. It gives Trump a battering ram. Obama won’t be president in six months. Why risk it?”

ACQ: “They don’t see much of a risk. Most Americans don’t know or care about the TPP.”

ME: “But they know big corporations are running economic policy. They think the whole system is corrupt. Believe me, Trump will use this against Hillary.”

ACQ: “He can’t. She’s inoculated. She’s come out against the TPP.”

ME: “But it’s her delegates who voted not to oppose it in the Democratic platform. Her fingerprints are all over this thing.”

Trump may not have many articulated policy positions, but his stance against TPP has been consistent and (unsurprisingly loud). Reich is right: to the extent that platforms mean anything at all, this will be used by Trump to pitch Democrats as sell-outs to American workers.

And the notion that voters won’t react against TPP is insulting. Sure, they may not know how specifically bad TPP is, but workers do know that NAFTA sucked. And Trump is certainly capable of equating the two.

Whoever this person is, by nature of being a Hillary advisor, he or she is supposed to be a technocratic elite. But this is idiotic, both from a policy and a political perspective.

An Economics For The Left

What would an economics for the left look like? It seems to me that it requires two things. First, it needs an economic theory derived from a close observation of the way the US economy actually behaves, and which creates a framework in which society can choose its goals and implement them effectively and as efficiently as possible. Second, it requires a leftist program, one clearly differentiable from the program of the conservatives and neoliberals which has so miserably failed millions of us, and one that people can understand and can see how it would make for a better world.

Theory

At the beginning of the 20th Century, the productive sector was dominated by a small group of capitalists who were primarily industrialists and financiers. Their control was secured by both federal and state governments in the name of protecting property rights and preventing Socialism. The interests of the rest of the people were for the most part ignored by the government. On the rare occasions when some piece of protective legislation was passed the courts struck it down. When a strike threatened the profits of the capitalists, the courts were quick to legitimate the use of force by governments. Eventually there was a small but effective Socialist Party. The capitalists responded by conflating Socialism with Anarchism and Communism, leading to the Palmer Raids, the jailing of the Socialist leader Eugene Debs, and other actions to crush all opposition to the dominant capitalist ideology.

Socialism came back in a milder form during the Depression, leading to the New Deal under FDR. Many of the major changes were made possible by fear of the Communists, particularly their support of the rights of African-Americans. That fear became stronger during WWII, and the Democrats purged Socialists from their party, starting with Henry Wallace, and the labor unions purged every last Communist and Socialist after the War. That left economics to a temporarily chastened breed of capitalists. By the 1950s there was no effective left opposition to capitalism. What C. Wright Mills called the Capitalist Celebration took over all economic discourse, and with no opposition, it was easy for a new breed of capitalists to push for the Gilded Age form of capitalism which we now call Neoliberalism.

The economic theory underlying this ideology had its roots in the 19th Century. William Stanley Jevons, one of the inventors of the theory of marginal utility and one of the first people to use the mathematical method in economics, wrote in The Theory of Political Economy, § 1.29 (1871).

I wish to say a few words, in this place, upon the relation of Economics to Moral Science. The theory which follows is entirely based on a calculus of pleasure and pain; and the object of Economics is to maximise happiness by purchasing pleasure, as it were, at the lowest cost of pain.

At the very core of neoclassical economics there is a moral judgment about humans and their behavior. Mainstream economics retains that core, and adds a number of other moral judgments. We are selfish utility maximizing creatures, we are purely rational creatures, able to make complex calculations about our utility on the fly. We are rewarded by the market for our skills, so that failure is our own fault, and success is due to our excellence. Economists use terms like moral hazard, and those preaching austerity claim that recessions and depressions are the result of our moral failures and we must be punished for those failures. Citizens acting through government neither can nor should do anything to make things better. Only the free market can save us.

A sensible leftist economic theory would not be grounded in an archaic philosophical theory about the nature of humanity or the nature of individual humans. It should to the maximum extent possible be non-judgmental about humans, and it should be as impervious as possible to the addition of moral overtones. We should look for a descriptive theory based on close observation of the way things work. Modern Money Theory is certainly a model for this kind of theory. Here’s how L. Randall Wray describes it in Modern Money Theory: A Primer on Macroeconomics for Sovereign Monetary Systems, §7.10:

On one level, the MMT approach is descriptive: it explains how a sovereign currency works. When we talk about government spending by keystrokes and argue that the issuer of a sovereign currency cannot run out of them, that is descriptive. When we say that sovereign governments do not borrow their own currency, that is descriptive. Our classification of bond sales as part of monetary policy, to help the central bank hit its interest rate target, is also descriptive. And finally, when we argue that a floating exchange rate provides the most domestic policy space, that is also descriptive.

Functional finance then provides a framework for prescriptive policy.

Any respectable economic theory should lend itself to either side as a plausible framework for solving society’s problems. Here’s what Wray says about that:

However, I also believe that most of the tenets of MMT can be adopted by anyone. It does not bother me if some simply want to use the descriptive part of MMT without agreeing with the policy prescriptions. The description provides a framework for policymaking. But there is room for disagreement over what government should do. Once we understand that affordability is not an issue for a sovereign currency-issuing government, then questions about what government should do become paramount. And we can disagree on those. (Emphasis in original.)

Program

It’s easy to identify a left program for the economy. We simply pick up where Franklin Delano Roosevelt left us, with his Second Bill of Rights. This is from his State of the Union Address, January 11, 1944.

We have come to a clear realization of the fact that true individual freedom cannot exist without economic security and independence. “Necessitous men are not free men.” People who are hungry and out of a job are the stuff of which dictatorships are made.

In our day these economic truths have become accepted as self-evident. We have accepted, so to speak, a second Bill of Rights under which a new basis of security and prosperity can be established for all regardless of station, race, or creed.

Among these are:

The right to a useful and remunerative job in the industries or shops or farms or mines of the Nation;

The right to earn enough to provide adequate food and clothing and recreation;

The right of every farmer to raise and sell his products at a return which will give him and his family a decent living;

The right of every businessman, large and small, to trade in an atmosphere of freedom from unfair competition and domination by monopolies at home or abroad;

The right of every family to a decent home;

The right to adequate medical care and the opportunity to achieve and enjoy good health;

The right to adequate protection from the economic fears of old age, sickness, accident, and unemployment;

The right to a good education.

All of these rights spell security. And after this war is won we must be prepared to move forward, in the implementation of these rights, to new goals of human happiness and well-being.

If it was good enough for FDR, and an inspiration for Bernie Sanders, it’s good enough for me.

It’s time to start thinking about an overarching program for the left, one that enables us to respond to the lives people are living right now. The economy is just one of the issues important to the left, but it sets the framework of permitted solutions to the many other problems we have. In future posts, I plan to take up these issues in more detail.

If Trump’s Protestors Didn’t Exist He Would Have to Invent Them

Since last Friday’s canceled Trump rally in Chicago, there has been quite a bit of discussion about protestors at Trump rallies — both the propriety of disrupting his events and some scolding about what a bad tactical move it was for protestors to shut down the Chicago event, as well as some sudden realization among the chattering classes that Trump really does espouse violence.

I’d like to take a different approach and look at how Trump uses protestors.

For months, Trump has made protestors an integral part of his schtick at rallies. A person of color, a woman in hijab, a woman with a walker shows up and either silently protests, perhaps holding or wearing an anti-Trump slogan, or does boo and call out. Purportedly in response to earlier disruptions, Trump instructs attendees before any disruption not to hurt the protestors, but instead to surround them, holding up Trump signs and chanting his name, until security comes to throw the protestor out. “Get him out of here!” Trump yells after his attendees have disinfected the herd. This is all part of the rhythm now of Trump’s rallies, a way to reinforce the mob mentality in a participatory way.  Supporters become more than mere voters: they get deputized into reinforcing the purity of the herd, like drone bees cleaning out a hive.

I’m agnostic about the efficacy of protestors thus treated — they serve a useful function for Trump, sure, but given that every rally he does is covered on TV, they also serve as witness to the violence and assumed nativism of the rallies (not that the chattering classes seemed to take all that much notice before last weekend). But any individual’s decision to protest is their own choice, and I fiercely admire the courage it takes to walk into one of those rallies and serve as witness.

Of course, the neat formula Trump has long relied on depends on having — or rather, maintaining the illusion of — a majority. The “Silent Majority” has really become something closer to the “Silent 30%” or even “Silent 25%,” but at Trump rallies it appears as if those no-longer silent angry people are a majority.

On Friday, Trump lost control of that illusion.

I agree with William Daley, among others, who suggests that Trump chose to create a confrontation by scheduling an event at UIC. But I also think protestors got a sufficient mass of organized protestors to the event to thwart the managed confrontation Trump was hoping for, because they deprived him of the illusion of a majority. So he canceled the event before even showing up, falsely citing Chicago Police Department warnings.

I’m agnostic here, too, about the efficacy of this protest. One thing that has been largely — though not entirely — ignored (which itself testifies to something about the efficacy of speech rights in this country) is that the protest was part of a larger effort, including the effort to oust Cook County State’s Attorney Anita Alvarez in today’s election; there were even “Bye Anita” signs at the protest. That is, the protest of Trump’s speech was part of a larger effort to fight systematic abuse of minorities, and as such had an affirmative message as well, though I admit the message reinforced afterwards — by both the protestors and press — is that they shut him down. I believe Alvarez has been leading in the polls, so we’ll see this evening whether the larger movement against her police cover-ups has achieved its goals.

But in questions of efficacy, I think it worth remembering how the Black Lives Matter protest of the Netroots Nation debate between Martin O’Malley and Bernie Sanders last July (which seems to have been entirely forgotten as people feel sorry for Trump). O’Malley basically gave up his microphone willingly; Bernie was more perturbed. A lot of attendees in the audience (the equivalent of all the Trump supporters who were deprived of their opportunity to hear him speak on Friday) were really angry; but many of those same people also wrote pieces in the weeks later talking about how important a learning opportunity being discomforted in such a way was. And that protest was undoubtedly effective, as it made the criminal and social justice issues a key focus of the Democratic primary. That’s not to say Trump protestors are as likely as Netroots Nation attendees to reflect on the privilege that attends uninterrupted speeches by white men, but sometimes protests do lead observers to rethink their own role (as, for example, mosque protestors in AZ who were invited inside only to learn about Islam in an unmediated way).

Let’s look, however, at what has happened in the days since Friday. On Saturday, Trump canceled and then uncanceled an event in Cincinnati, citing Secret Service concerns. Also on Saturday, protestor Thomas DiMassimo rushed Trump on stage (something I don’t defend, as it created real concerns about Trump’s safety; DiMassimo is lucky he wasn’t shot). Finally, in Kansas City, protestors achieved the result that Chicago protestors might have imagined: the sustained silencing of Trump, which he used to 1) claim Sanders supporters were the problem and 2) reinforce his love for the police.

Since then there have been reports of Trump finally doing what he chose not to do before (I argue, because protestors play a key function in his rallies): screening attendees of likely protestors, including profiling on race, which carries with it its own visual messaging that may even influence attendees. Yesterday, Trump retreated to his less visceral means of reinforcing the bully structure of his campaign, again referring to Rubio as “Lil Marco” and publicly humiliating Chris Christie.

Here’s the underlying point, though. Amid all the discussions of both the law and norms surrounding interrupting speech, few have accounted for the way that well-managed spectacle is a key (arguably the key) to Trump’s attraction. That spectacle relies partly on Trump’s mock frankness — his ability and willingness to say anything he wants, including repeated promises he will address presumed grievances of his supporters. But it relies, at least as much, on his ability to mobilize a mob in a certain way, including to create the illusion for that mob that they are part of a coherent pure majority. That mob gives them the illusion of power they believe they have been illegitimately stripped of. It’s an illusion, of course, but Trump is a master at managing that spectacle to prevent cracks from forming in that illusion.

And this is why the response to Trump has largely been so ineffectual. Polls in FL showed that voters were more likely to support Trump given Friday’s shutdown (so on that level, at least, the protest may have backfired). But DC pundits scolding Trump has largely the same effect, reinforcing the sense of grievance. So if the DC press want to do something about Trump’s frightening power, they might do more reflection about how they have been a willing partner in it.

The way to weaken Trump is not to continue to magnify his spectacle, as the press has done non-stop for a year. This is tough for cable news to manage, because they are in the business of spectacle.

One way to weaken him is to reveal how Trump has exacerbated the grievances motivating his supporters, never addressed them. As a reminder, one of the only times Trump has really backed down over the course of this campaign was when Bernie attacked him for wanting to lower wages, because that’s a truth that, reinforced, might sow doubt.

The other way to is to disrupt Trump’s manufactured spectacle of strength, because his supporters are only going to support him so long as they believe his bluster about always winning (which relies, in part, on the bullying he performs at his rallies). I’m not sure whether disruption of rallies does that or not. Magnifying the degree to which Trump is a fearful man would. Reporting on his many failures would. Certain kinds of reminders of his past weaknesses might (though some would reinforce the sense of grievance).

Side note, one spectacle that did not get shown by the press were the protests in Detroit in advance of the GOP debate there. So as people complain about protestors not simply standing powerfully outside, know that the press has chosen in the past to ignore that spectacle.

I suspect Marco Rubio’s advisors had it right, even though they delivered it through the absolutely wrong messenger. Trump’s reliance on guest workers (he likes to conflate skilled H1B workers, which have been a central part of GOP debates, with unskilled H2B workers he employed at Mar Lago) and his use of Chinese manufacturers for his campaign swag are both real vulnerabilities. And if someone wants to suggest Trump is operating out of some sense of inferiority because he has a small flaccid penis and small hands to match, that may well undercut the spectacle of virility that Trump has affirmatively cultivated.

I think Megyn Kelly (because she’s a woman who has succeeded in making Trump look dumb, once Fox stopped letting Trump dictate her role in coverage), and — before Trump equated protestors with Bernie Sanders (maybe still, though I don’t know) — Bernie, are two of the few people who have the ability to undercut Trump’s power on mobilizing grievances. Probably some centrist union leaders have the same ability, as well as a select few faith leaders. There are vanishingly few people who have the power position to call attention to the degree to which Trump has contributed to his followers’ grievances, rather than done anything to alleviate them, but that evidence is out there.

I’m not sure what happens from here. Demographically, there should be no way Trump wins the general election; as I noted, the Silent Majority, to the extent it existed in Nixon’s era, is a minority now. Assuming it will be a Trump – Clinton race, I don’t know that we know, because Clinton will have a harder time addressing those grievances, and because the high negatives of both candidates will make turnout really unpredictable (though I also suspect Hillary will be an acceptable crossover vote for many Republican Neocons).

But there is one other unpredictable player here: the cops. For some time, both Ted Cruz and Trump have been feeding the perceived feeling of grievances of cops that they have been unfairly targeted by activists complaining about police violence. As noted, Trump hails the cops even as he dehumanizes protestors. Both Cruz and Trump have been buttering up the cops that may one day have the ability to turn the violence that has been simmering for some time in one direction or another (with the consequent spectacle). Though there were a few reports of heavy-handedness from Chicago cops, in general they did a good job of managing the tensions on Friday. I really, really worry that Cleveland’s cops (who are getting some new war toys in advance of the GOP convention) won’t exercise the same restraint.

Trump’s power rests on spectacle. He will not be defeated, primarily, with a rational argument or some tut-tutting about norms about violence (that, in fact, the US neither culturally nor internationally really abide by in any case), in part because there are few credible messengers of the rational argument about how Trump has contributed to grievances. If his spectacle starts to crack, however, the investment in Trump as a savior will dissolve. It won’t go away — it’ll get invested somewhere else, potentially even someone more violent (though that person is unlikely to have the soapbox Trump has). But his power depends on illusion.