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How Bad Antitrust Enforcers Kill People

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Matt Stoller comments in BIG on a NY Times story I blogged recently:

How A Merger Killed the Ventilator Market

The New York Times had an important story about the ventilator market a few days ago, with Nicholas Kulish, Sarah Kliff and Jessica Silver-Greenberg reporting why a government effort to stock up on the machines after the SARS epidemic failed.

In 2006, in attempt to learn from what might happen should a SARS-like disease hit here, civil servants in government decided to stockpile ventilators. They wanted both more ventilators and better ventilators than were on the market. So government officials found a small innovative corporation called Newport Medical, and contracted with the corporation to design a cheaper and better version.

Ventilators at the time typically went for about $10,000 each, and getting the price down to $3,000 would be tough. But Newport’s executives bet they would be able to make up for any losses by selling the ventilators around the world.

“It would be very prestigious to be recognized as a supplier to the federal government,” said Richard Crawford, who was Newport’s head of research and development at the time. “We thought the international market would be strong, and there is where Newport would have a good profit on the product.”

At first the project seemed on track. Newport built a working prototype, and the government was on track to order 40,000 ventilators to put into the national stockpile. Newport would then be able to sell additional units into the health care market, as well as abroad. But in 2012, Covidien, a large medical device manufacturer and distributor, bought up Newport Medical, canceled the Federal contract, and shut down Newport’s ventilator line of business.

The result, in 2020, is that we don’t have enough ventilators in a pandemic.

There are three failures of policy here. I’ll start with the simplest, which is that the merger should have been blocked.

Antitrust Failure

The merger by any standard was a clear-cut antitrust violation. There are two theories as to why Covidien sought to buy Newport. First, Covidien already had a ventilator product, and didn’t want to compete with a lower priced and better version. Covidien bought Newport to take its competitive product out. That’s called a ‘killer acquisition,’ meaning that the goal is to undermine a potentially innovative or lower prices product line.

The second is that roll-ups were part of a broader consolidation trend in the industry in general. “Manufacturers,” as the Times reported, “wanted to pitch themselves as one-stop shops for hospitals, which were getting bigger, and that meant offering a broader suite of products.”

Both theories are likely true. Covidien from 2008-2014 bought 17 other corporations. Covidien pitched itself not just as a device maker, but as a device distributor to hospitals. It even called itself a platform, saying in its press release bleating about the acquisition that the acquisition would strengthen its “ventilation platform” for patients around the world. In other words, Covidien was both trying to take out a potential competitor *and* strengthen its own bargaining posture against hospital purchasers, who were themselves getting bigger.

The merger should have and could have been blocked on many different grounds, the simplest being the killer acquisition theory. Yet the Federal Trade Commission, led by Jon Leibowitz, just waved the illegal merger through without even asking any questions. Now there are calls, by both FTC Commissioner Rebecca Kelly-Slaughter, and antitrust thinkers across the board, to reexamine this merger. In Congress, Antitrust Committee Chairman David Cicilline made this point on Twitter. . .

Continue reading. There’s much more, and it shows the degree to which the US is out of whack. Later in the column:

The roll-up of device makers that Covidien was pursuing was part of a longstanding consolidation in the medical industry that correlated to consolidation more broadly. Because our antitrust laws focus on low consumer prices, what has happened across the economy is the creation of ‘power buyers.’

Most people look at monopolies who made commodities, say, steel, and believe a monopoly manifests by how much that company can raise the price of what it sells. But monopolies can operate on the buying side too. Walmart is a buying monopoly, able to use its market power to push prices down against suppliers and workers. I mean if you sell a large chunk of your product to Walmart, they can tell you what price to take. The price to consumers may be low, but that’s because Walmart is using market power against the supplier and not the consumer. But because our antitrust enforcers don’t see anything but consumer prices, corporations like Walmart became far more powerful from the 1980s to the 2000s.

As Olivia Webb noted, there was a Walmart-ization of the medical industry as well, as hospitals combined purchasing power in cartels called Group Purchasing Organizations. GPOs buy supplies for hospitals, and they are supposed to get better prices. But they often don’t. In 1986 Congress exempted them from anti-kickback laws, so there are huge conflicts of interest in how they operate. GPOs are also big. In 1996, the Clinton administration basically said GPOs wouldn’t be subject to antitrust prosecution. Today, for context, just four GPOs account for 90% of generic pharmaceutical purchasing. GPOs also handle medical devices.

Throughout the 2000s and 2010s, one of the results of these choices, as well as the refusal to enforce merger law or antitrust, was the concentration in these corporations that sell things to hospitals, everything from syringes to software. During the HIV epidemic, a corporation called Retractable Syringes developed a safer syringe that doctors and nurses wanted to prevent accidental needlesticks, but GPOs prevented them from selling their product to hospitals. None of this went unnoticed. Congress held hearings, to no avail, on all sorts of innovative medical devices that couldn’t make it into hospitals. Retractable won a private antitrust lawsuit, but more recently it lost one on appeal. Without legal redress, much of the medical device industry consolidated. Covidien itself was bought by Medtronic a few years ago.

Written by LeisureGuy

1 April 2020 at 5:36 pm

Kushner Firm Built the Coronavirus Website Trump Promised

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Self-dealing is the norm with the Trump administration. Robinson Meyer writes in the Atlantic:

On March 13, President Donald Trump promised Americans they would soon be able to access a new website that would ask them about their symptoms and direct them to nearby coronavirus testing sites. He said Google was helping.

That wasn’t true. But in the following days, Oscar Health—a health-insurance company closely connected to Trump’s son-in-law, Jared Kushner—developed a government website with the features the president had described. A team of Oscar engineers, project managers, and executives spent about five days building a stand-alone website at the government’s request, an Oscar spokesperson told The Atlantic. The company even dispatched two employees from New York to meet in person with federal officials in Washington, D.C., the spokesperson said. Then the website was suddenly and mysteriously scrapped.

The site would not have helped many Americans even if it had launched. Today, more than two weeks after the president promised a national network of drive-through test sites, only a handful of such sites have opened, and fewer than 1 million Americans have been tested.

The full extent of Oscar’s work on the project has not been previously reported. The partnership between the administration and the firm suggests that Kushner may have mingled his family’s business interests with his political interests and his role in the administration’s coronavirus response. Kushner’s younger brother Joshua is a co-founder and major investor in Oscar, and Jared Kushner partially owned or controlled Oscar before he joined the White House. The company’s work on the coronavirus website could violate federal ethics laws, several experts said.

For the past several weeks, Kushner has led a “shadow task force” on the coronavirus, separate from Vice President Mike Pence’s official committee, according to The Washington Post. Kushner’s team, composed of federal officials allied with Kushner and outside corporate executives, has met in the headquarters of the Department of Health and Human Services. A senior official at that agency called Oscar to ask for its help on March 13, the day of Trump’s press conference, the Oscar spokesperson said.

Kushner’s group has focused on expanding and publicizing coronavirus testing, especially at drive-through locations. Oscar’s website would have asked users if they were experiencing symptoms of COVID-19, the illness caused by the virus, and surveyed them about other risk factors, including their age and preexisting conditions. It also would have listed a limited number of testing locations nationwide, including some of the drive-through sites that Trump promised. It was designed to look like a government-developed product, provided freely by the Department of Health and Human Services to the American public. Oscar posted the source code for the site to Github, where The Atlantic reviewed it.

The site resembled a version of a tool Oscar had already built for its customers in response to the crisis, but it was “adjusted to meet the specifications and requirements set by the federal government,” Jackie Kahn, the Oscar spokesperson, said in an emailed statement. That Oscar had already been working on a coronavirus-testing website when HHS called to ask for help was a coincidence that had nothing to do with Kushner, Kahn suggested. She declined to say whether Oscar had discussed that site with Joshua Kushner or any board members or investors before Trump’s March 13 press conference.

Oscar donated its work freely and never expected to be paid for the project, Kahn said. The company is “not, nor has ever been,” a contractor or subcontractor for the government, she said, which would make it harder for the government to pay Oscar for its work. The work was “all at the direction of HHS,” she said. “The website never saw the light of day,” she added in an interview today.

That may not matter from an ethics perspective. The ad hoc nature of Kushner’s task force has already collided with federal laws. Oscar’s involvement deepens Kushner’s ethics and conflict-of-interest problems.

“It’s not typical. It’s usually not allowed,” Jessica Tillipman, an assistant dean at the George Washington University School of Law and an expert on anti-corruption law, told me.

Oscar’s relationship with the Trump administration could breach federal law in two ways, Tillipman and other experts told me. First, companies are generally not supposed to work for the federal government for free, though some exceptions can be made in a national emergency. “The concern, when you have some free services, is that it makes the government beholden to the company,” Tillipman said.

More important, she said, any Kushner involvement may have violated the “impartiality rule,” which requires federal employees to refrain from making decisions when they even appear to involve a conflict of interest. The rule also prohibits federal employees from making a decision in which close relatives may have a financial stake. Such a situation would seem to apply to Kushner and Oscar. In 2013, Jared and Joshua were the “ultimate controlling persons in Oscar’s holding company,” according to a New York State report that Mother Jones dug up earlier this month. . .

Continue reading.

Written by LeisureGuy

31 March 2020 at 12:17 pm

A World Without Partisan Gerrymanders? Virginia Democrats Show the Way

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Note what Democrats do. Jesse Wegman writes in the NY Times:

Politicians rarely give up power voluntarily. They never give it up when they have free rein to lock it in for at least a decade, and exact long-overdue revenge against their political opponents.

But a group of Virginia Democrats did just that earlier this month, when they voted in favor of an amendment to the State Constitution stripping themselves of the power to redraw legislative district maps in 2021, after the decennial census.

Last fall, Democrats won majorities in both houses of the Virginia Legislature; with a Democratic governor already in office, they took full control of the state government for the first time in a generation. They had unlimited power to fashion the new maps in their favor, cementing their own grip on power just as Republicans around the country have done since the last redistricting cycle in 2011. Some Republican maps are so biased that they have given the G.O.P. legislative supermajorities even when the party loses the statewide popular vote, which happened in Wisconsin in 2018. So it’s entirely understandable for Democrats who regain power to want payback — now.

And yet nine Virginia Democrats agreed to put down their partisan swords and join Republicans to support the new amendment, which would require that the state’s district maps be drawn by a bipartisan commission made up of lawmakers and regular citizens. Voters must ratify the amendment in November before it will take effect.

The Democrats’ vote was a display of integrity and selflessness by members of a party with unified control of government. It placed long-term interest in the health of representative democracy over the shorter-term partisan benefits that both parties have been happy to exploit when they control redistricting.

The Virginia amendment’s passage is all the more important in the present moment, when voters everywhere have been left at the mercy of self-serving state lawmakers, thanks to the Supreme Court’s refusal to intervene to stop even the most extreme partisan gerrymanders. The ruling last June, by a 5-to-4 vote, asserted that redistricting was a political matter to be resolved by the states, not the federal courts. The justices thus enshrined one of the most corrosive and anti-democratic practices in American politics.

Virginia’s new amendment would establish a 16-member commission, made up of eight lawmakers and eight citizens, divided evenly between the two major parties. A supermajority of both lawmaker and citizen commissioners would have to agree on a proposed map to send it to the Legislature and governor for approval. If they can’t, the job shifts to the State Supreme Court.

The amendment, which under the State Constitution had to pass the Legislature twice in a row before going to the voters, was first approved in 2019 by overwhelming bipartisan margins . . .

Continue reading.

Written by LeisureGuy

28 March 2020 at 8:57 pm

Stop the $6 Trillion Coronavirus Corporate Coup!

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Too late. But a good column by Matt Stoller:

Since Saturday, I’ve seen an emerging right-left argument about what we need to do to address the pandemic.

The American Economic Liberties Project (my org) put out a statement against the bill, AFL-CIO official Damon Silvers, who oversaw the 2008 bailout, put out an article against the bill, as did dozens of economics and finance professors. Congresswoman Alexandria Ocasio-Cortez warned of the risks of a bill tilted to big business, as did libertarian member Justin Amash. John Cassidy wrote in the New Yorker how to do a bailout without corruption. And Georgetown law professor Adam Levitin pointed out that the bill is “robbing taxpayers to bail out the rich.”

But then these two Senators, Chuck Schumer and Mitch McConnell, cut a deal last night. And from what I can tell, it’s really really bad, and much of the bad stuff is not being included in the sleazy marketing materials from Schumer and McConnell, or in the reporting about the bill. There’s a reason for that. Sunlight would kill this thing.

That means there is a narrow way to stop it.

What Is In This Bill?

Congress is going to pass a bill with a lot of important stuff for workers, hospitals, cities and small business, and to address the pandemic. That’s inevitable. And the bill on the table includes some of this. The question though is what else the bill includes, and that’s where we get into trouble. Because while we have to deal with the pandemic and crisis, we do not have to fundamentally eliminate the economic rights of all of us in the process.

Now, first I should say I don’t have the final deal in hand because it’s not public. I have only seen versions of the negotiating text. But I’m fairly sure most of these provisions haven’t changed, because the final sticking points were over various direct pandemic spending pieces. If I get that wrong, I’ll tell you in an update.

On Saturday, I went over the Christmas wish list of corporate lobbyists in this process, everything from Adidas letting people deduct gym costs to candymakers seeking a $500 million loan to Jeff Bezos and Elon Musk seeking $5B in loans for their space corporations. Of course what Wall Street sought, and got, dwarfed all of these requests.

Here’s how you can tell. A lot of reporters have been talking about how this is a $2 trillion deal, with a bunch of spending for hospitals and whatnot. But last night White House advisor Larry Kudlow announced it is actually a $6 trillion deal. And business reporter Charlie Gasparino said he’s hearing chatter that the total will be $10 trillion! Say what?!?

How does this work? How can Wall Street have one impression of the amount of money, and everyone else have a different impression? Easy. Confusion, lying and bad reporting. If important people don’t talk about the boring sounding big stuff, then us non-important people sound crazy or nerdy mentioning it. It’s a giant game of social climbing, and the goal is to make all of us afraid to point out what’s going on. (Incidentally I hope Rep. Brad Sherman, who is an accountant and a key anti-bailout leader, really delves into this.)

So let’s talk about the big stuff that McConnell, Schumer and Pelosi are hiding.

The bill establishes a series of boring-sounding slush funds, and these will be given strange alphabet soup names by the Federal Reserve and Treasury, names like ‘special purpose vehicle’ and ‘ABS’ and ‘TALF’ and FDIC bank guarantees. That’s where the real money is. Here are some of these slush funds, starting with the ones that are more understandable:

  • $50 billion in loans and loan guarantees to airlines
  • $8 billion in loans and loan guarantees to air cargo carriers
  • $17 billion in loans and loan guarantees to “businesses critical to national security”
  • A $425 billion fund for loans and investments to be used at the discretion of the Secretary of the Treasury, Steve Mnuchin. He can use it to loan money, buy stock, buy bonds, whatever.

Obviously helping certain enterprises is important, so I’m not opposed to industry aid. But the terms and conditions matter, and based on what I’m seeing, I don’t believe there will be meaningful restrictions on this aid. Executives and financiers are going to profit off of taxpayer money.

So that’s the stuff that’s been reported. Here’s what hasn’t, and why the bill goes up in value to $6-10 trillion. . .

Continue reading. There’s more. I think the US is toast.

Written by LeisureGuy

25 March 2020 at 10:18 pm

Blatant corruption: Senator Dumped Up to $1.6 Million of Stock After Reassuring Public About Coronavirus Preparedness

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Unfortunately, this self-dealing and using public office for private gain seems to be the rule in the US Congress these days. Robert Faturechi and Derek Willis report in ProPublica:

Soon after he offered public assurances that the government was ready to battle the coronavirus, the powerful chairman of the Senate Intelligence Committee, Richard Burr, sold off a significant percentage of his stocks, unloading between $582,029 and $1.56 million of his holdings on Feb. 13 in 29 separate transactions.

As the head of the intelligence committee, Burr, a North Carolina Republican, has access to the government’s most highly classified information about threats to America’s security. His committee was receiving daily coronavirus briefings around this time, according to a Reuters story.

A week after Burr’s sales, the stock market began a sharp decline and has lost about 30% since.

On Thursday, Burr came under fire after NPR obtained a secret recording from Feb. 27, in which the lawmaker gave a VIP group at an exclusive social club a much more dire preview of the economic impact of the coronavirus than what he had told the public.

“Senator Burr filed a financial disclosure form for personal transactions made several weeks before the U.S. and financial markets showed signs of volatility due to the growing coronavirus outbreak,” his spokesperson said. “As the situation continues to evolve daily, he has been deeply concerned by the steep and sudden toll this pandemic is taking on our economy.”

Burr is not a particularly wealthy member of the Senate: Roll Call estimated his net worth at $1.7 million in 2018, indicating that the February sales significantly shaped his financial fortunes and spared him from some of the pain that many Americans are now facing.

He was one of the authors of the Pandemic and All-Hazards Preparedness Act, which shapes the nation’s response to public health threats like the coronavirus. Burr’s office did not respond to requests for comment about what sort of briefing materials, if any, on the coronavirus threat Burr may have seen as chair of the intelligence committee before his selling spree.

According to the NPR report, Burr told attendees of the luncheon held at the Capitol Hill Club: “There’s one thing that I can tell you about this: It is much more aggressive in its transmission than anything that we have seen in recent history … It is probably more akin to the 1918 pandemic.”

He warned that companies might have to curtail their employees’ travel, that schools could close and that the military might be mobilized to compensate for overwhelmed hospitals.

The luncheon was organized by the Tar Heel Circle, a club for businesses and organizations in North Carolina that are charged up to $10,000 for membership and are promised “interaction with top leaders and staff from Congress, the administration, and the private sector.”

Burr’s public comments had been considerably less dire. In a Feb. 7 op-ed that he co-authored with another senator, he assured the public that “the United States today is better prepared than ever before to face emerging public health threats, like the coronavirus.” He wrote, “No matter the outbreak or threat, Congress and the federal government have been vigilant in identifying gaps in its readiness efforts and improving its response capabilities.”

Members of Congress are required by law to disclose their securities transactions.

Burr was one of just three senators who in 2012 opposed the bill that explicitly barred lawmakers and their staff from using nonpublic information for trades and required regular disclosure of those trades. In opposing the bill, Burr argued at the time that insider trading laws already applied to members of Congress. President Barack Obama signed the bill, known as the STOCK Act, that year. . .

Continue reading.

Written by LeisureGuy

19 March 2020 at 5:07 pm

How America got this way

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An excellent Facebook post by Heath Cox Richardson:

Heather Cox Richardson
March 14, 2020 (Saturday)

The reality of the novel coronavirus pandemic is sinking in as our infections continue to rise. Still, a number of people insist that alarm about the pandemic is political, whipped up by the media to weaken the president. When New York Representative Alexandria Ocasio-Cortez begged people under 40 to stay out of bars, restaurants, and public spaces to keep from spreading Covid-19, Katie Williams, a former Ms. Nevada who was stripped of her title for putting pro-Trump postings on the non-political Ms. America social media accounts, responded “I just went to a crowded Red Robin and I’m 30. It was delicious, and I took my sweet time eating my meal. Because this is America. And I’ll do what I want.”

As Americans either settled into self-isolation or ignored expert advice and hit bars and beaches, the administration’s travel restrictions from Europe, which went into effect today, created chaos in the 13 airports assigned to handle American passengers returning from 26 countries. Those airports were understaffed, leaving passengers at Chicago’s O’Hare to wait for up to six hours for their bags, and then another 2-4 to get through a health screening and customs, all the while packed together. Illinois Governor J.B. Pritzker, a Democrat, finally took to twitter to get Trump’s attention, prompting Pritzker’s political opponents to tell him to fix his own state.

But customs is under federal, not state, jurisdiction. There was nothing Pritzker could do except tweet: “The federal government needs to get its s@# t together. NOW.”

The fight over whether to take the coronavirus pandemic seriously, as well as the administration’s inept handling of it, is the outcome of forty years of assault on the American government. Since 1980, when Ronald Reagan ran for office on the warning that “government is not the solution to our problem, government is the problem,” Republicans have made war on the idea of an expert bureaucracy in charge of our government.

It was a huge shift for the party, which had come out of World War Two with a deep commitment to a conservatism that focused on using the government to promote stability at home and across the globe by fostering equality of opportunity and rising standards of living for all. Those commitments required extending the government regulations, social safety net, and infrastructure development pioneered in the 1930s by President Franklin Delano Roosevelt and the Democrats. Republican President Dwight Eisenhower did just that, regulating business to protect labor, expanding civil rights, and passing what was at the time the largest public works program in American history: the Federal Aid Highway Act of 1956, which created our interstate highway system.

But a small group of reactionaries who hated business regulation, civil rights, and the taxes that public works programs require, insisted that the growing government infringed on their liberty. They got little traction because Americans liked the new, active government that enabled people to get educations, make a decent wage, and stop worrying they would have to live off their children or root through garbage cans for food when they got too old to work.

But when the Supreme Court, overseen by former Republican governor of California Earl Warren, unanimously agreed that segregated schools were unconstitutional, and Eisenhower enforced that decision in 1957 with federal troops at Little Rock Central High School, these reactionaries tied racism to their hatred of federal bureaucracy. The growing government of “experts,” they said, was taking tax dollars from hardworking white people and using them to give benefits to people of color. They were redistributing wealth. They were snaking communism or socialism into America and would destroy the very individualism that made America great.

That formulation—that an active government run by bureaucrats trying to regulate business, promote social welfare, and develop our infrastructure is socialism that will destroy us—gradually took over the Republican Party. In 1980, Reagan, who used this rhetoric but in fact governed far more moderately than he sounded, brought this ideology into the White House. He began the Republican addiction to tax cuts. When it became clear the cuts were not, in fact, expanding growth and paying for themselves as promised, but rather were cutting programs voters liked, the Reagan team shored up their support by courting evangelicals, marrying religious dislike of secularism to Republican pro-business individualism.

Over the years since, Republican leaders have continued to cut taxes, regulations, social safety nets, and infrastructure, all in the service of shunning socialism and promoting individualism. Whatever needs to be done, businessmen can do it best, they say. Government bureaucrats are inefficient and wasteful.

As this ideology has increasingly degraded our society, more and more voters have turned against it. So Republican leaders have stayed in power first by suppressing opposition voters, and then by gerrymandering districts so that Republicans have a systemic advantage. In 2012, for example, after states drew new districts after the 2010 census, Democratic candidates for seats in the House of Representatives won 1.4 million more votes than their Republican counterparts, and yet Republicans came away with a 33-seat majority.

Republican leaders have worked to pack the courts. too. As Reagan’s attorney general Edwin Meese put it, the idea was “to institutionalize the Reagan revolution so it can’t be set aside no matter what happens in future elections.” Reagan appointed more judges than any other president before him, including three Supreme Court justices and one chief justice. The rightward swing of the court continued when George W. Bush (who lost the popular vote) appointed two Supreme Court justices, including a chief justice.

That swing has gone on steroids under Senate Majority Leader Mitch McConnell (R-KY). He held up the judicial appointments of Democratic President Barack Obama and finally refused even to consider Obama’s moderate nominee for the Supreme Court. Another Republican elected with a minority of the popular vote, Trump filled that seat and another. McConnell has been rushing through Trump’s judges at an unprecedented pace—almost as many as Obama appointed in his entire 8 years– and vowed this week that the pandemic will not slow down judicial appointments.

So extreme has the court become in the service of the Republican agenda that on Wednesday, former Judge James Dannenberg resigned his membership in the Supreme Court Bar—lawyers admitted to practice before the high court– of which he has been a member since 1972. Dannenberg’s resignation charges that the court is practicing “radical ‘legal activism,’ at its worst.” It is an “extension of the right wing of the Republican Party, he wrote, subverting or ignoring the law “to achieve transparently political goals.”

He accused the court of taking us back to the first Gilded Age and warned, “The only constitutional freedoms ultimately recognized may soon be limited to those useful to wealthy, Republican, White, straight, Christian, and armed males— and the corporations they control. This is wrong. Period. This is not America.”

And so, it seems the reactionaries of the 1950s got what they wanted. We have decimated our government bureaucracy and expertise, slashed taxes and the social safety net, and crippled our infrastructure, all in the name of promoting American business and the individualism that, in theory, encourages economic growth. The president, along with his enablers in the Senate, have tried to cement this ideology onto the country through the courts.

And now, the coronavirus pandemic is putting their system to the test. So far, it is failing miserably.

Written by LeisureGuy

15 March 2020 at 7:15 pm

The Fall of the US: One more crack in the foundations

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Dahlia Lithwick writes in Slate:

James Dannenberg is a retired Hawaii state judge. He sat on the District Court of the 1st Circuit of the state judiciary for 27 years. Before that, he served as the deputy attorney general of Hawaii. He was also an adjunct professor at the University of Hawaii Richardson School of Law, teaching federal jurisdiction for more than a decade. He has appeared on briefs and petitions as part of the most prestigious association of attorneys in the country: the Supreme Court Bar. The lawyers admitted to practice before the high court enjoy preferred seating at arguments and access to the court library, and are deemed members of the legal elite. Above all, the bar stands as a sprawling national signifier that the work of the court, the legitimacy of the institution, and the business of justice is bolstered by tens of thousands of lawyers across the nation.

On Wednesday, Dannenberg tendered a letter of resignation from the Supreme Court Bar to Chief Justice John Roberts. He has been a member of that bar since 1972. In his letter, reprinted in full below, Dannenberg compares the current Supreme Court, with its boundless solicitude for the rights of the wealthy, the privileged, and the comfortable, to the court that ushered in the Lochner era in the early 20th century, a period of profound judicial activism that put a heavy thumb on the scale for big business, banking, and insurance interests, and ruled consistently against child labor, fair wages, and labor regulations.

The Chief Justice of the United States
One First Street, N.E.
Washington, D.C. 20543

March 11, 2020

Dear Chief Justice Roberts:

I hereby resign my membership in the Supreme Court Bar.

This was not an easy decision. I have been a member of the Supreme Court Bar since 1972, far longer than you have, and appeared before the Court, both in person and on briefs, on several occasions as Deputy and First Deputy Attorney General of Hawaii before being appointed as a Hawaii District Court judge in 1986. I have a high regard for the work of the Federal Judiciary and taught the Federal Courts course at the University of Hawaii Richardson School of Law for a decade in the 1980s and 1990s. This due regard spanned the tenures of Chief Justices Warren, Burger, and Rehnquist before your appointment and confirmation in 2005. I have not always agreed with the Court’s decisions, but until recently I have generally seen them as products of mainstream legal reasoning, whether liberal or conservative. The legal conservatism I have respected– that of, for example, Justice Lewis Powell, Alexander Bickel or Paul Bator– at a minimum enshrined the idea of stare decisis and eschewed the idea of radical change in legal doctrine for political ends.

I can no longer say that with any confidence. You are doing far more— and far worse– than “calling balls and strikes.” You are allowing the Court to become an “errand boy” for an administration that has little respect for the rule of law.

The Court, under your leadership and with your votes, has wantonly flouted established precedent. Your “conservative” majority has cynically undermined basic freedoms by hypocritically weaponizing others. The ideas of free speech and religious liberty have been transmogrified to allow officially sanctioned bigotry and discrimination, as well as to elevate the grossest forms of political bribery beyond the ability of the federal government or states to rationally regulate it. More than a score of decisions during your tenure have overturned established precedents—some more than forty years old– and you voted with the majority in most. There is nothing “conservative” about this trend. This is radical “legal activism” at its worst.

Without trying to write a law review article, I believe that the Court majority, under your leadership, has become little more than a result-oriented extension of the right wing of the Republican Party, as vetted by the Federalist Society. Yes, politics has always been a factor in the Court’s history, but not to today’s extent. Even routine rules of statutory construction get subverted or ignored to achieve transparently political goals. The rationales of “textualism” and “originalism” are mere fig leaves masking right wing political goals; sheer casuistry.

Your public pronouncements suggest that you seem concerned about the legitimacy of the Court in today’s polarized environment. We all should be. Yet your actions, despite a few bromides about objectivity, say otherwise.

It is clear to me that your Court is willfully hurtling back to the cruel days of Lochner and even Plessy. The only constitutional freedoms ultimately recognized may soon be limited to those useful to wealthy, Republican, White, straight, Christian, and armed males— and the corporations they control. This is wrong. Period. This is not America.

I predict that  . . .

Continue reading.

Written by LeisureGuy

14 March 2020 at 5:00 pm

Posted in GOP, Government, Law

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