The 1/6 Committee Hearings, Day 2: It's All About the Grift

The second day of the 1/6 Committee's public hearings was yesterday, commencing at 10:00 a.m. ET. If you didn't see it—say, because you have a job—then you can watch it here, if you wish:

Why the Committee shifted away from primetime is not known, but presumably it was because the major networks might resist giving up too many days' worth of valuable TV real estate. It's true the first hearing drew 20 million people, but that was spread across many outlets. Further, the number is likely to drop over time. Losing an episode or two of General Hospital is surely less painful than losing a Grey's Anatomy.

In any case, those of us who teach are off for the summer. So, we were able to watch, even with the adult-unfriendly scheduling. Here are the 10 biggest storylines, in our view:

1. The Main Argument: The thesis that was put forward about a minute into the first hearing, and that will be the dominant theme of all the hearings, was also put forward early in this hearing courtesy of the Committee's vice chair Liz Cheney: "The Trump campaign legal team knew there was no legitimate argument... to overturn the election, and yet President Trump went forward with his plan for January 6 anyway."
   
   They are going to say that over and over, because if there is any single idea that the Committee wants to communicate to voters (and to the Department of Justice), this is it.
   
   
2. Sub-Argument 1: A big goal of yesterday's hearing was to develop the central thesis more fully, and to lay out specific parts of the overall puzzle. One major sub-argument was that Trump did not merely refuse to accept the election results as they rolled in. Instead, his refusal was plotted out in advance, and would have been put into effect regardless of what actually happened on Election Day. It was pointed out, quite correctly, that he did the exact same thing in 2016, for weeks making clear that he would not accept the election of Hillary Clinton as legitimate. It was only his surprise victory that made it unnecessary for Trump to act on that threat.
   
   
3. Sub-Argument 2: According to both American law and American custom, politicians have very wide leeway to pursue their political program, regardless of how absurd or offensive it may seem. And so, if Donald Trump (or his acolytes) end up at the wrong end of civil or criminal suits thanks to their activities between November of 2020 and January of 2021, they might plausibly argue that they really and truly believed the election was stolen, and that they were acting in accordance with that political position.
   
   That, then, brings us to another significant theme of yesterday's presentation. The Committee believes that Trump knew full well that he lost the election. However, in an effort to cover all contingencies, they made the case that if the former president somehow did not know, it was because he chose to be ignorant, to disregard those around him who were speaking truth, and instead to rely on fools and charlatans.
   
   What it amounts to is an argument that if Trump did not "know" he lost the election, then his ignorance was due to reckless negligence. In many legal matters, reckless negligence makes a person just as guilty as a willful bad act.
   
   
4. Sub-Argument 3: This, we suspect, will prove to be the single-most important point introduced last night. With Committee member Rep. Zoe Lofgren (D-CA) taking the lead, it was suggested that Trump's primary motivation might not have been protecting his bruised ego, but instead fleecing his followers for hundreds of millions of dollars. Two former Trump campaign aides, Gary Coby and Hanna Allred, testified that while the Trump campaign sent out hundreds of e-mails, including several on 1/6, hitting up supporters for donations to the "Election Defense Fund," there was no such thing as the Election Defense Fund. Instead, the quarter-billion dollars raised was funneled to people and groups in Trump's orbit.
   
   This was a relatively small aspect of yesterday's hearing, but Cheney made clear the point would be revisited at greater depth in a future hearing. This revelation is a big deal for two reasons. The first is that it provides a legal theory that ties everything together: Team Trump pre-planned a rejection of the election results, actually rejected the results, filed a bunch of frivolous lawsuits, and then encouraged violence on 1/6, all in service of a large and very successful moneymaking scheme. "The Big Lie was also a big rip-off," Lofgren declared.
   
   The other reason that this is a big deal is that if Trump and his acolytes were raising money for thing [X] but were actually sending that money to [W], [Y], [Z] and a bunch of other places that are not [X], that opens the door to being charged with things like wire fraud and racketeering. These tend to be very provable crimes because of the paper trail they leave behind, and $250 million in misappropriated donations could literally mean millions of criminal counts. It's almost a cliché but, as we have pointed out many times, Al Capone didn't get popped for murder or robbery, he got popped for financial crimes.
   
   
5. "Team Normal" vs. Rudy/Trump: In building the case that Trump knew, or should have known, that he lost the election, the Committee presented testimony from an array of Trump insiders. Former AG Bill Barr was the star of the night, but Deputy AG Richard Donoghue, former first daughter Ivanka Trump, former campaign manager Bill Stepien, and former Trump campaign and/or Trump White House legal counselors Matt Morgan, Alex Cannon and Eric Herschmann all had a chance to shine. Stepien delivered the soundbite of the night, observing that, when it came to accepting the election results: "There were two groups, my team and Rudy [Giuliani]'s team. I didn't mind being part of 'Team Normal.'" Meanwhile, in a particularly brutal recollection about the Rudy faction, Herschmann said: "What they were proposing I thought was nuts. It was a combination of Italians and Germans, and different things that had been floating around as to who was involved. Remember there was Chavez and the Venezuelans and an affidavit from somebody who said he wrote software in, and something in the Philippines. Just all over the radar."
   
   
6. Painting a Picture, Part I: As we noted yesterday, the Watergate hearings unfolded across an entire summer, giving that committee plenty of time to explore every aspect of its case. The 1/6 Committee has decided, perhaps correctly, that we live in a time of much shorter attention spans, and that it will be necessary to get as much bang out of every buck (or every hour of testimony) as possible. And so, while working to nail Trump to the wall, Chair Bennie Thompson (D-MS) and his colleagues also laid out a narrative of the election, and how it unfolded. This narrative had, in effect, two parts.
   
   The first part, which we might call "Election Day," was about what happened on November 3, 2020. Responsibility for this part of the story fell primarily upon former Fox editor Chris Stirewalt, who made the decision to call Arizona for Joe Biden on the night of Nov. 3, and who lost his job as a result. Stirewalt took the committee through that evening, explaining why there was a "red mirage" that made it look like Trump would win, then discussing why he concluded (correctly, of course) that Joe Biden had won Arizona, and then explaining that once Arizona was lost, Trump's reelection hopes were dead in the water. There was not a single word of testimony from Stirewalt that was not known to the committee (or, for that matter, to the readers of this site) before that testimony escaped his lips. He was there to explain to members of the general public, those who may not read political blogs on a daily basis, why there was no "steal" to stop.
   
   
7. Painting a Picture, Part II: The second part of the narrative here might be called "After Election Day." Here, it was up to a trio to tell the tale: Former Philadelphia City Commissioner Al Schmidt, U.S. Attorney for the Northern District of Georgia B.J. Pak, and longtime Republican election lawyer Benjamin Ginsberg. They were in complete agreement that there was no basis for claims of fraud, and that the lawsuits filed by the Trump campaign were entirely frivolous. To help the three make their case, the committee interspersed clips of Rudy Giuliani in court, making stupid and outlandish claims. That probably did more to sell the argument than all three of the witnesses, combined. Schmidt, Pak, and Ginsberg also spoke to the harm done by Trump's false claims, with Schmidt in particular delivering very compelling testimony about how he and his family were threatened and doxxed by angry Trump supporters.
   
   
8. Take Lemons, Make Lemonade: You know what they say about the best laid plans of mice, men, and 1/6 Committees. Undoubtedly, Thompson & Co. are planning these sessions very, very carefully, which is probably why they need gaps in between hearings. But they surely knew they'd have a few curve balls, and they got one yesterday, as Bill Stepien—who was supposed to be present in person—had to bow out at the last minute due to his wife going into labor. The Committee had to scramble for about 45 minutes, but they were able to replace his in-person testimony with clips from his deposition. That may actually have been for the best, since the Committee was therefore able to control exactly what the audience heard from Stepien, and there was no risk that he might sneak in a few words in defense of Trump.
   
   
9. Garland Is Watching: This was not revealed during the hearing, but it's important, nonetheless. Attorney General Merrick Garland confirmed yesterday that he is watching the hearings. That is news that will gladden the hearts of the Committee, and of Democrats and supporters of law and order and democracy across the land. It would take... quite a lot for the AG to hear everything that's been said (and that will be said) and to walk away with the conclusion "Nothing problematic happened here."
   
   
10. So Is Trump: There is no way Trump could leave his TV off for this, but now we know that he and his people are watching carefully. Yesterday, he released a 12-page response to the first day's hearing (i.e., the one last Thursday night). He clearly didn't write it himself since, besides the fact that 12 pages is a lot of work, the document has 61 footnotes. Still, whoever did write it (probably Stephen Miller) managed to capture the former president's special brand of unhinged wackiness and stream-of-consciousness bloviating. The document starts with a long screed against Joe Biden, reiterates over and over that the 2020 election was indeed stolen, invokes Dinesh D'Souza's new film 2000 Mules as a key source of evidence, asserts that one of the linchpins of the Democratic scheme was Mark "Zuckerbucks" Zuckerberg, says that the only reason that every judge ruled against Trump is that they were "scared" of liberals (this is described as a "Pandemic of Injustice"), and claims that the 1/6 Committee is trying to keep him from being reelected in 2024. The latter point is an excellent illustration of the old maxim that even a broken clock is right twice a day.

And with that, Day 2 is in the books. Day 3 will commence at 10:00 Wednesday, and it will be (V) who writes it up, so you may get a slightly different take. We shall see. (Z)

Voters in Five States Head to the Polls

Another Tuesday, another set of primaries. Today, Maine, Nevada, North Dakota and South Carolina will hold their primaries, while Texas will hold yet another special election. Here are the seven biggest storylines:

1. Governor, Nevada: Far and away the most notable gubernatorial contest of the day will take place in Nevada. On the Democratic side, Gov. Steve Sisolak is expected to win renomination easily over his only opponent, former Clark County commissioner and state assemblyman Tom Collins. On the Republicam side, by contrast, there is meaningful drama. The establishment candidate is former senator Dean Heller. The Trumpy candidate—and he has Donald Trump's endorsement—is Clark County Sheriff Joe Lombardo. The "Huh?" candidate is Joey Gilbert, a former boxer and reality TV star and a current lawyer. Lombardo will probably win, as he is polling around 30% while Gilbert and Heller are both polling around 15%.
   
   In the short term, if Lombardo does get the nomination, it will be a "win" for Trump. In the long term, Lombardo is surely the weakest of the three candidates when it comes to the general election. He is a Second Amendment fanatic, and he not only opposes any new gun laws (e.g., "red flag" laws), he wants to roll back existing laws. For example, he sees no reason there should be a national registry of gun owners. This would appear to be a platform that is ill-suited to this political moment.
   
   There are also gubernatorial elections in Maine and South Carolina this year, but there doesn't figure to be much of interest from those states today. In the former, Gov. Janet Mills (D) will be renominated, while former governor Paul LePage (R) will win the right to try to get his old job back. This could become a barnburner in the general election, or maybe not, because LePage is pretty toxic. But no barns will be burned today, as both candidates are unopposed. Meanwhile, in South Carolina, Gov. Henry McMaster (R) will crush his only opponent, who calls himself "Trucker Bob," despite having the first name Harrison (was "Trucker Harry" taken?), while former Representative Joe Cunningham (D) will claim his party's nomination. This contest is much less likely than Maine to get interesting, given how red South Carolina is.
   
   
2. Senator, Nevada: As with the Nevada gubernatorial race, the Democratic incumbent, in this case Sen. Catherine Cortez Masto, is going to win renomination easily. The Republican side of the contest is much more of a dogfight. The frontrunner is Adam Laxalt, scion of two political dynasties, and another Trump endorsee. The insurgent is Sam Brown, a decorated veteran who is not very Trumpy, is running as a political outsider, and is making the argument that Laxalt (who lived most of his life in Washington, D.C.) is a carpetbagger. Brown has been making up ground in the polls, picking up the support of 15% of Nevada Republicans in the past two months, but he's still at roughly 35% to Laxalt's 45%. So, Brown looks like he is going to run out of time to make up the gap.
   
   We're not sure whether Laxalt or Brown would be the stronger general election candidate, but we will point out that Laxalt ran for governor in 2018 and lost to Sisolak, 49.3% to 45.3%. Further, the one time Laxalt won statewide election, the 2014 contest for state attorney general, he got 46.2% of the vote to 45.3% for his Democratic opponent. So, it sure looks like Laxalt has a ceiling of around 46%, which is not likely to get it done in a U.S. Senate race. In case you are wondering, the Green Party has not put forward a candidate, but the Libertarian Party has (Neil Scott, an accountant). So, if the third-party vote hurts either candidate in this race, it figures to hurt the Republican.
   
   There are also Senate races in North Dakota and South Carolina this year, but both states are ruby red and Sens. John Hoeven (R-ND) and Tim Scott (R-SC) are both running for reelection. They'll win renomination today, and will find out which Democratic unknown they'll be defeating in November.
   
   
3. U.S. House, South Carolina: South Carolina, which would have invented gerrymandering if Massachusetts hadn't thought of it first, has no competitive House districts (six are Republican and one is Democratic). The story here, then, is about how much muscle Donald Trump really has. Rep. Nancy Mace (R) has sometimes publicly supported the notion that Trump was naughty on 1/6; she lambasted him on 1/7, but then turned around and voted against the second impeachment, and then followed that by voting against the 1/6 Committee, but then voted to hold Steve Bannon in contempt. So, she's kind of trying to have it both ways. Rep. Tom Rice (R), meanwhile, has been somewhat less of a chameleon, and voted in favor of the impeachment. Trump hates both, and has recruited challengers, namely former state Rep. Katie Arrington (Mace) and state Rep. Russell Fry (Rice). Anything could happen here; Arrington is loudly opposed by the Republican establishment and also by many Trumpers as she is a pretty mediocre politician, and managed to lose this very seat (SC-01) to a Democrat in 2018, while Fry is just one of six challengers, and those six could well split the vote.
   
   
4. U.S. House, Maine: ME-01 is deep blue, but ME-02 is now red (R+6), and so Republicans rightly see it as a prime pickup opportunity. Rep. Jared Golden (D), who might be the most centrist Democrat in the House, is unopposed, but he'll learn today if he's going to be facing small business owner Elizabeth Caruso or former representative Bruce Poliquin. Caruso is slightly Trumpy, as complaining about undocumented immigration is her main campaign plank, but she's not fanatical. There's been no polling, but we assume that Poliquin is the favorite today and is the stronger general election candidate by virtue of having more political experience and greater name recognition.
   
   
5. U.S. House, Nevada (Democrats): When drawing the new set of maps, Nevada Democrats decided to live dangerously, and created three districts that are blue, but barely so. In other words, they are the sort of districts that could be swept away in a red wave. The most endangered Democrat is probably Diana Titus in NV-01, who not only has to try to survive the general election, she has also drawn a strong challenge from the left in the Bernie Sanders-endorsed activist Amy Vilela. In any case, Titus, Susie Lee in NV-03, and Steven Horsford in NV-04 have all drawn multiple potential Republican challengers; from three in Horsford's case to eight in Titus' case. They will each learn today which foe they will face. Democratic PACs have already reserved a staggering $34 million in commercial time to try to protect the trio.
   
   
6. U.S. House, Nevada (Republicans): None of the incumbent representatives in Nevada are going to have it easy this cycle. The one Republican in the state's House delegation is Mark Amodei, whose generally moderate politics align well with his district's moderate redness (it's R+8). He's drawn a serious challenge from the right in the person of Danny Tarkanian, son of the beloved former UNLV basketball coach Jerry Tarkanian. Outside groups have dumped half a million dollars into the race in hopes of unseating Amodei, who has made the (apparent) mistake of admitting he does not hate immigrants or LGBTQ+ people. Assuming the Representative survives, there are seven Democrats vying for the chance to take him on.
   
   
7. Texas Special: "Texas Special" sounds like a kind of gun, or else something that might be acquired from certain kinds of massage therapists for an extra $20. But no, it's an election. Specifically, Rep. Filemon Vela (D) decided to quit in the middle of his term in order to start earning some of that sweet, sweet lobbyist money. So now a candidate is needed to finish off the last bit of his term.
   
   There are two Democrats running, Cameron County Commissioner Dan Sanchez and municipal bureaucrat Rene Coronado, and two Republicans, healthcare worker Mayra Flores and nurse practitioner Juana Cantú-Cabrera. Perhaps you can tell that it's not so plausible to get elected in this district if you're not a Latino or Latina. The Republican Party believes it can make a statement if it can win here, so they have dumped gobs of money on Flores in hopes of making that happen. She has been able to spend sixteen times as much cash as the two Democrats combined. We would suggest that, even if she wins, it's no statement at all. Special elections, as we've pointed out roughly 10 million times, are wonky. Plus, the GOP isn't going to be able to outspend the Democrats 16:1 in November. If none of the four gets 50% of the vote today, then the top two will advance to a runoff on August 8. All of this for the privilege of serving roughly 4 months in the House, much of which will be taken up with recesses.

There you have it. We'll have a rundown of the results tomorrow. (Z)

The State of the Economy Is Not Good

Gas prices are going nuts these days, with the national average now above $5/gallon (which seems quaint to people in, say, California, where the average is more like $7/gallon). Food prices keep rising, too, something that is not exactly helped by the whole gas thing, since food tends to be transported in trucks, and trucks run on (expensive) gasoline. Rents, home prices, medical bills, retail goods, insurance, and all manner of other expenses keep shooting up, too, in a manner not seen in 10, 20, 30, even 40 years.

In short, the country—and the world—are in the midst of a period of severe inflation. It's not the worst ever; that actually happened in 1778, when the annual tally was 29.78% due to the ongoing war and the lack of a stable currency. But, the inflation now is certainly the worst in 40 years, recalling the low points of the Ford and Carter presidencies.

In view of this, the Federal Reserve Bank appears to be ready to take a step it hasn't taken in close to 30 years, namely increase the prime rate by 0.75%. Normally, the increases are 0.25% or 0.50%, but desperate times call for desperate measures. Hiking the prime rate makes it more expensive to borrow money, and therefore reduces spending, and therefore reduces competition for goods, and therefore cools inflation. At least, that's how it's supposed to work, though sometimes it takes several hikes to achieve a meaningful cooling.

One big downside to increasing the prime rate, particularly this much at one time, and particularly without much warning, is that it tends to startle Wall Street. There are a couple of main reasons for this. The first is that if money is more expensive to borrow, it's harder for companies to grow themselves and their revenues. The second is that, in view of problem #1, stocks become less attractive as investments relative to more stable (but lower-yield) options like treasury bonds. So, two rather significant sources of corporate capital both take a hit when the Fed does what it does.

Predictably, in view of all this, the news of the 0.75% increase spooked Wall Street something fierce, and every major index took a dive yesterday; the Dow was down 2.8%, the Nasdaq was down by 4.7%, and the S&P 500 fell 3.9%, to take three notable examples. This means that stocks are now down 20% from their previous high (set back in January), which is the definition of a bear market. There's probably something poetic in the fact that much of this was caused by Russia, a country whose national animal is a bear.

It should be noted that the prime-rate increase is not "official" yet, though Chair Jerome Powell has made clear that the rate needs to go up pronto, and since the pain of the increase has already been felt (i.e., yesterday's stock market drop), there is little reason to change course now. In fact, there is even some scuttlebutt the Fed might go to 1.0%. Whatever is going to happen, Powell is expected to make an official announcement later this week, very possibly tomorrow.

We sometimes get letters, including a few in the past week, asking why we don't write more often about the ups and downs of the economy. There are four reasons:

1. While the economy is politics-adjacent, it's not exactly politics, which is our focus.
   
   
2. Macroeconomics is not really an area of expertise for either of us.
   
   
3. Rarely does a day go by that there is not some dramatic news about the economy, either how well it is doing or how poorly it is doing. This makes it difficult, particularly in view of our limited expertise, to decide what stories are actually worth noting, and which ones are just that day's hype. For what it's worth, it's the first-time-in-three-decades Fed rate hike that cleared the bar and spurred this item.
   
   
4. When the economy does poorly, there isn't all that much for us to say about the political impact that hasn't already been said (by us and by others) a million times.

With that said, now that we're writing a "state of the economy" item, we'll note the three things worth pointing out when it comes to politics:

1. It is not good news for the party in power when the economy is doing poorly, and everyone is paying an arm and a leg for gas while watching their 401(k)s plummet.
   
   
2. That said, "It's the economy, stupid!" might not apply nearly so much in 2022 as it did in 1992. Recent elections have suggested that pocketbook issues are sometimes outweighed these days by other concerns, like culture wars issues. The Supreme Court has never overturned Roe before, and it remains possible that abortion and/or guns and/or the insurrection will negate some of the vinegar caused by the bad economy.
   
   
3. Even if the economy does end up as the central issue of 2022, the state of affairs in June is nowhere near as important as the state of affairs in August, and the direction things are headed at that point. If the market rebounds a bit, gas prices start to fall (as they usually do at the end of summer), it gets easier to buy a house, etc., that could defang the economy as an issue, even if inflation remains above average and the bear market is still in effect.

Those are pretty much our insights about the politics vis-à-vis the economy in the year 2022. Certainly worth reiterating once in a while, but not worth repeating every time the market drops 300+ points and the Chicken Littles of the media write breathless stories about how the Dow is falling. (Z)

Well, This Is Ironic... or Not

People, perhaps most famously Alanis Morissette, sometimes misuse the word "ironic," applying it to situations that are unfortunate or strange. What the word is really supposed to describe is, per the OED, "a state of affairs or an event that seems deliberately contrary to what one expects and is often amusing as a result." With Donald Trump's platform Truth Social, we now have a situation that is extremely ironic, and yet not ironic at all.

What is the meaning of all this double-talk? Well, Truth Social was ostensibly founded with a free speech mission, wherein users would be free of the "censorship" practiced by the meanies at Twitter and Facebook. In particular, political speech was supposed to be unfettered, consistent with the First Amendment (overlooking the fact that the First Amendment does not apply to privately held concerns). So, it is ironic, then, that Truth Social has begun to engage in aggressive censorship of political speech. We bet you can guess what recent major news story is likely to get you banned from the platform if you reference it with anything other than disgust and revulsion. Yep, it's the 1/6 Committee hearings. So much for unfettered political speech.

That said, this is only ironic if you took Trump & Co. at their word that this would be a "free speech" platform. Otherwise, it's not unexpected, and therefore not ironic, at all. Nobody with an ounce of sense actually believed that Truth Social would allow users to say whatever they wanted, especially since the terms of service made clear that Truth Social reserves the right to ban users "for any reason or for no reason." It was always clear that it would be a right-wing bubble where right-wing ideas would be embraced and celebrated and left-wing ideas would be disappeared, in the manner predicted by George Orwell. We're less than 6 months in, and Truth Social has already proven itself to be vastly more censorial than Twitter or Facebook ever were, since it is way harder to get banned from those platforms than it is to get banned from Truth.

We continue to have no interest in signing up for an account and wading through that cesspool of rage, conspiratorial thinking and authoritarianism. If we want those things, we'll just go to the next faculty meeting. Fortunately for us, reader J.L. in Los Angeles (well, one of them, we actually have several J.L.'s in Los Angeles) brings to our attention the Twitter account @patriottakes, which sifts through the stuff being produced by right-wing nutters and shares the most relevant. Clearly, the folks who run that account are doing the Lord's work. (Z)

Sixteen States and Puerto Rico Make the Cut for Early Voting in 2024

As you may have heard, the populations of Iowa and New Hampshire are very, very white. That makes them a pretty good match for the Republican Party, perhaps, but not so much for the Democrats. And so, the Democratic pooh-bahs have decided to take a long look at alternative possibilities, and encouraged the various Democratic organs to submit applications to the DNC for consideration. A total of 20 applications were received, and the Democrats—being the softies that they are—allowed 17 of them to advance to the next stage of the process.

Here are the 17 that advanced: Colorado, Connecticut, Delaware, Georgia, Illinois, Iowa, Maryland, Michigan, Minnesota, Nevada, New Hampshire, New Jersey, Oklahoma, Puerto Rico, South Carolina, Texas and Washington. Needless to say, putting Texas at or near the top of the list would favor a very different kind of candidate than bestowing the honor on, say, Delaware. It is also worth pointing out that New Hampshire's participation in the process somewhat undermines their argument that they get to have the first primary, no questions asked, since it's in their state constitution. If there was no question as to the Granite Staters' primacy, they wouldn't need to participate in this process, now would they?

Meanwhile, the lonely three that could not get past the first round were New York, Nebraska and Democrats Abroad. One wonders what they did to be turned down as part of a process that has an 85% acceptance rate. Maybe they forgot to submit their list of references, or maybe they failed their drug tests. In any case, they're out. The other 17 will make presentations to the Democrats' Rules and Bylaws Committee later this month, and then up to five will be granted permission to schedule their primaries or caucuses prior to Super Tuesday. (Z)

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