Jun. 10

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How the Newspapers Covered Comey

Former FBI Director James Comey's testimony to a Senate committee was front page news all over the country. Here are some of the headlines:

The headlines were not kind to Trump. Seven of them contain "lies," five contain "lied," and five contain "liar." It is not normal that major newspapers have front-page headlines with these words in reference to the President. But these are not normal times. (V)

Comey Draws 19.5 Million Viewers

The Nielsen ratings are in, and they reveal that across the various networks that broadcast James Comey's testimony, 19.5 million people tuned in to watch. ABC led the way among broadcast networks with over 3 million viewers, while Fox News (naturally) led among cable stations.

The good news for Donald Trump is that this figure comes up a bit short of certain other high-profile Congressional appearances, such as the 20 million people who watched Anita Hill and the 40 million who watched Oliver North. The bad news is that the 19.5 million figure does not include people who watched the hearings online, nor all those who saw the footage later as part of the myriad news broadcasts that aired throughout the day on Thursday. Put another way, a lot of people saw Trump's dirty laundry being aired, one way or another. In fact, just the people who watched live and on TV are enough to make the broadcast the most-watched of the week, just ahead of the NBA Finals. (Z)

Trump Has No Interest in Proving that Comey Lied

Ezra Klein has an interesting piece on Vox saying that Donald Trump's response to former FBI Director's testimony is not about showing that Comey is wrong or that he lied. Trump offered no evidence that Comey was mistaken or misguided. What Trump wants to do is drive the news coverage. He wants to give talking points to his defenders in the media so they have something to talk about other than what Comey wrote and said. By claiming complete victory, without any evidence, he got a story on Fox News headlined: "Comey testimony: Trump responds, claims 'total and complete vindication'." By claiming that Comey lied, he gave Infowars license to write an article entitled: "CONFIRMED: COMEY COMMITTED PERJURY TO CONGRESS."

In other words, Trump's response, and that of his lawyer, Marc Kasowitz, are not a point-by-point explanation of why Comey is wrong and why Trump is right. It is about providing material to already-friendly news outlets and his supporters to talk about instead of Comey's actual testimony.

To the extent Trump and Kasowitz are just throwing up smokescreens to distract everyone from the underlying issues, that may succeed. What may be the most important question in all of Russiagate is now on the back burner. Trump is notorious about demanding total loyalty from everyone but offering it to no one—except former NSA Michael Flynn. The big (forgotten) question here is: "What does Flynn know that is so damaging that Trump would risk his presidency trying to keep Flynn quiet?" (V)

The Pushback on Comey Has Barely Begun

During his testimony before the Senate committee, some of the Republican senators were almost acting like lawyers, defending the President. For example, Sen. James Risch (R-ID), a former prosecutor, carefully led Comey along a path in which Comey admitted that Trump had merely expressed a "hope" that he [Comey] would drop the Flynn case and that nobody had ever been charged for "hoping" anything. Speaker Paul Ryan has already expressed the thought that because Trump is a newbie president, he's going to make newbie mistakes, and that's no big deal.

Benjamin Wittes of the Brookings Institution has written an interesting piece that a full-court press against Comey is about to begin. He will be accused of leaking in public (see below), of being a coward for not confronting Trump directly in the Oval Office, and of failing to warn Congress when he knew Trump had done something wrong. We are going to see many disputes over the facts of the case. Trump and Comey disagree on whether Trump gave an implicit order to Comey to drop the Flynn case. We are going to see battles over Comey's personal interpretation of Attorney General Jeff Sessions' body language, and much more.

Many Republicans will check the polls and if Trump is still holding up, come to his defense by saying what he did does not meet the statutory definition of obstruction of justice as laid out in Title 18 of the United States Code. Republicans will say that Democrats are sore losers because Trump won the election and they are making a mountain out of a molehill to try to undo the election. There are going to be many hit pieces about Comey. As long as Trump's supporters stick with him, the entire Republican establishment is going to be gunning for Comey. The goal will not be to beat Comey into submission; they know that is impossible. But it will be to try to keep public opinion from moving too far in the wrong direction. (V)

Trump's Lawyer Will File a Complaint about Comey Leaking

CNN is reporting that the lawyer leading Donald Trump's defense, Marc Kasowitz, is going to file a complaint with the Justice Dept. about James Comey giving a memo he wrote to a friend, Daniel Richman of Columbia University Law School, with instructions to give it to a reporter. Trump and his lawyers have a long history of threatening to sue people, but they don't always follow through.

Trump may not realize it, but Kasowitz certainly does, that this would be an incredibly stupid thing to do. Comey is not going to be fazed one bit and will not go off and hide in a cave somewhere, cowering in fear. First of all, the Dept. of Justice has limited power over former employees. Comey carefully wrote his memos to avoid including any classified information, so they can't get him for unauthorized disclosure of national secrets. To have real consequences, Deputy Attorney General Rod Rosenstein would have to actually charge Comey with some kind of crime. That's the last thing Rosenstein would do. He has no case at all and knows it very well. He has enough on his plate without a frivolous case he can't possibly win. Trump could also sue Comey for libel about the seven-page memo he gave the Senate committee or slander for what he said during the hearing, but the bar to winning libel or slander cases is exceedingly high for public officials. Not to mention the fact that what Comey said would have to be false.

This whole thing sounds like Trump still doesn't understand that being President of the United States is not the same as being a New York wheeler and dealer. Before he became president, Trump often sued or threatened to sue people to make them settle for what he wanted, in part due to the expense of defending themselves. If Trump were to actually follow through, lawyers who don't like Trump would be trampled in the rush to get to Comey first to defend him pro bono, just for the publicity. Or if Comey went to gofundme.com and asked for contributions for his defense fund, he would raise the necessary amount in under 5 minutes. Trump implicitly threatened Comey with being fired when they were alone in the Oval Office on Feb. 14 and that didn't work. A potential or real lawsuit won't make him back down either. Trump apparently doesn't understand this. It is hard to teach a 70-year-old dog new tricks. (V)

Kasowitz's Clients Have Close Ties to Putin

Although the lawyer leading Donald Trump's defense in Russiagate is primarily a civil litigator rather than a defense lawyer or national security expert, he does know a thing or two about Russia. In particular, he has some major Russian clients, including Oleg Deripaska, whose holdings include the world's second largest aluminum company. He is worth an estimated $5 billion. About 10 years ago, Trump's former campaign manager, Paul Manafort, set up an investment fund in the Cayman Islands, a notorious tax haven, for Deripaska, in which the oligarch put Ukrainian investments.

Another client of Kasowitz is the Sberbank, which is owned by the Russian government. A former vice president of this bank, Sergey Gorkov, later got a better job: CEO of Vnesheconombank, also owned by the Russian government. Vnesheconombank is under sanctions imposed by Barack Obama after Russia's invasion of the Crimea in 2014. Gorkov would dearly love to have those sanctions lifted. In Dec. 2016 he had a meeting with Trump's son-in-law, Jared Kushner. After the meeting he said it was about business, not politics. Doing business with sanctioned banks coould be illegal, depending on the nature of the business.

What is striking about all this is that so many of Trump's close associates have dealings with Russians, especially high-placed Russians close to Putin. These include Kasowitz, Manafort, Felix Sater, Michael Flynn, Carter Page, and others. Politico has made a series of graphics to show the many connections. It is unusual, to say the least, for a U.S. president to be surrounded by numerous people with deep ties to Russia. (V)

Trump Says He's Willing to Testify Under Oath

Donald Trump is not content to let his lawyer and his GOP colleagues do all the work of pushing back against James Comey. He wants to tell his side of the story, and told reporters on Friday that he is "one hundred percent" willing to do so under oath.

It would appear that what the President wants to do is to declare, on the record, that he never obstructed justice. Presumably, however, Trump does not realize that once he is under oath, he would be asked all manner of questions where he would likely be either compelled to confirm James Comey's version of events, or to perjure himself. For example, what if he was asked, "Did you ask James Comey to back off on the Russia investigation?" If Trump said "no," then he'd immediately be asked why he wanted everyone else to leave the room, and would go down a rabbit hole of trying to concoct a plausible alternative explanation. Meanwhile, Congress, and/or the courts, and/or the American people would be left to judge whose story was more plausible, and that is a contest the President would not win. Alternatively, Trump could say "yes," but then he'd be confirming Comey's story, or he could try to plead the fifth amendment, which would probably not fly, and would be the same as admitting guilt in the court of public opinion.

Another group of questions would be the ones Trump would no longer be able to dodge. For example, he would surely be asked, "Do you have recordings of your meetings with James Comey?" If he says "yes," he would have to produce them. If he says "no," which is probably the true answer, then he would be left with egg on his face for having tried to bluff his way out of things. And there's definitely no way he could invoke the fifth amendment, since his answer would not incriminate him. Undoubtedly, Marc Kasowitz recognizes all of this, and will try to keep his client from following through on Friday's threat. (Z)

Bettors: Trump Will Probably Be Impeached or Resign

James Comey's testimony has moved the needle. While betting on political outcomes is illegal in the U.S., it is legal in the U.K. and Ladbrokes, a major U.K. bookie, is now offering 4/7 odds that Donald Trump will not finish his first term. These odds translate to an implied probability of 64% that Trump will be gone before Jan. 20, 2021. Previously, bettors thought Trump would survive; no longer. Of course, that people thinking that something is going to happen (even if they are wagering real money on it), doesn't mean they can foretell the future, but once public opinion turns against Trump, it could be the beginning of the end. Ladbrokes also gives a probability of 78% that Trump will not be reelected.

Irish bookie Paddy Power puts the chance of impeachment at 56%. Paddy Power doesn't offer a bet involving Trump's resignation. It does, however, allow people to bet on why he will be impeached. The top three reasons are: (1) treason, (2) perjury, and (3) tax evasion. Interestingly enough, obstruction of justice is not in the list (yet). (V)

House Votes to Repeal Dodd-Frank

Given the attention paid to James Comey, this story flew under the radar a bit. It's almost like House Republicans didn't want too much attention paid to what they were doing. In any case, on Thursday, they voted to repeal Dodd-Frank, which imposed regulations on the financial sector in an effort to forestall another meltdown of the sort that we saw during the Bush presidency. Afterwards, Paul Ryan & Co. offered the usual platitudes about job creation, and economic growth, and the like.

Now the matter will be taken up by the Senate, which is likely to pass a modified version of the bill. The tactical problem in the upper chamber is the same as with other legislation: Either they have to get at least 8 Democratic votes (not likely), or they have to pass a bill through reconciliation. The latter option would mean only changing rules that have no budgetary impact, and thus would result in a less aggressive "repeal." Then, the Senate and House bills would have to be hammered into a single, unified bill in conference.

There is also an additional hurdle here, namely that any change would have to be approved by the chairs of the Fed and the FDIC and the Comptroller of the Currency. Fed chair Janet Yellen, who will be around until at least 2018, is none too likely to be signing off, and the other two jobs haven't been filled yet, as Donald Trump lags on his nominations. So, this is yet another area where the GOP, despite controlling the whole government, faces an uphill battle. (Z)

Ossoff Opens a Big Lead in Newest Poll

The Atlanta Journal-Constitution has commissioned a poll of the Congressional runoff election in GA-06 to be held June 20. It reveals that Democrat Jon Ossoff has a 7-point lead over his Republican challenger Karen Handel, 51% to 44%, with about 5% of the voters undecided, and a 4-point margin of error.

It would be a pretty big upset, then, if Ossoff did not win, particularly given how much money he and the blue team dumped into the race. And so, the parties are already getting their narratives set in advance of Tuesday's result. For the Democrats, the story is, "See! Donald Trump is so unpopular that we're now winning solidly-red districts. GOP beware in 2018!" For the Republicans, the story is, "The Democrats essentially bought this one; nothing to see here." Both sides have an argument, and it will carry on throughout the rest of the year, as there are no other "moratorium on Trump" style races scheduled right now. (Z)

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