Tag: ronald reagan
Why We Should All Fear A Trumpified Federal Reserve

Why We Should All Fear A Trumpified Federal Reserve

Sometimes the Federal Reserve has extraordinary power over the economy.

Consider what happened from 1982 to 1984. For most of 1982 the U.S. economy was in grim shape. Employment had plunged, especially in manufacturing. The unemployment rate hit 10.8 percent in December (it was 4.2 percent last month.) And economic pain helped Democrats make major gains in the 1982 midterms.

But everything was about to change, thanks to the Fed. In the summer of 1982 the Fed decided to ease monetary policy. Interest rates plunged, and about 6 months later the economy began a stunning rebound, growing 4.6 percent in 1983 and 7.2 percent in 1984. Ronald Reagan claimed credit for “Morning in America,” but actually it was the Fed that did it.

This episode illustrates the Fed’s power — power that must be insulated from abuse by politicians, especially politicians like Donald Trump.

Over the past several days Trump has been demanding that the Fed cut interest rates and calling for the Fed chairman’s “termination.” It’s worth looking at what he posted on Truth Social to get a sense of how, to use the technical term, batshit crazy he is on this subject:


And we really, really don’t want someone that crazy dictating monetary policy.

The reason we don’t want politicians in direct control of monetary policy is that it’s so easy to use. After all, what does it mean to “ease” monetary policy? It’s an incredibly frictionless process. Normally the Federal Open Market Committee tells the New York Fed to buy U.S. government debt from private banks, which it does with money conjured out of thin air. There’s no need to pass legislation, place bids with contractors, deal with any of the hassles usually associated with changes in government policy. Basically the Fed can create an economic boom with a phone call.

It's obvious that this kind of power could be abused by an irresponsible leader who wants to preside over an economic boom and doesn’t want to hear about the risks. This isn’t a hypothetical scenario. Consider what happened in Turkey, whose Trump-like president, Recep Tayyip Erdoğan, recently arrested the leader of the opposition. When the global post-Covid inflation shock hit, Erdogan embraced crank economic theories. He forced Turkey’s central bank, its equivalent of the Fed, to cut interest rates in the belief, contrary to standard economics, that doing so would reduce, not increase inflation. You can see the results in the chart at the top of this post.

How can we guard against that kind of policy irresponsibility? After the stagflation of the 1970s many countries delegated monetary policy to technocrats at independent central banks. Can the technocrats get it wrong? Of course they can and often have. But they’re less likely to engage in wishful thinking and motivated reasoning than typical politicians, let alone politicians like Trump.

What makes Trump’s attempt to bully the Fed especially ominous is the fact that the Fed will soon have to cope with the stagflationary crisis Trump has created. Trump’s massive tariff increase will lead to a major inflationary shock:

Moreover, Trump has also created huge uncertainty by radically changing his policies every few days, which will depress spending and may well cause a recession:

Not incidentally, Trump has been able to pursue these destructive policies because U.S. law gives the president enormous discretionary power over tariffs. And now he wants the same kind of discretionary power over the Fed.

As a consequence of Trump’s destructive tariff regime, the Fed will soon face a dilemma. Should it raise interest rates to fight inflation, or should it cut rates to fight recession? It’s a really hard call, and it’s quite possible that Jay Powell will get it wrong. Trump has made Powell’s dilemma even worse with his attempted bullying, because a rate cut would be seen by many as a sign that Powell is giving in to avoid being fired.

But one thing we know for sure is that we don’t want Trump making that call. Like Erdogan, he has embraced crank economic doctrines to justify his policies, in Trump’s case the ludicrous claim that tariffs won’t raise consumer prices. Does anyone doubt that when inflation rises, he’ll dismiss it as “fake news”?

So will Trump’s attempt to bully the Fed succeed? According to the Wall Street Journal, he has spent months talking privately about firing Powell. He doesn’t have the legal authority to do that, but Trump doesn’t worry about pesky things like legal limits to his authority. Yesterday he told reporters that he can easily get rid of Powell: “If I want him out, he’ll be out of there real fast, believe me.”

And given how quickly Trump has been able to subvert or destroy many other government institutions, it’s hard to feel confident that he can’t do the same to the Fed. Fear of market reaction — America is already facing a serious credibility problem, with the dollar falling even as interest rates rise — will probably restrain him, but he may not believe people telling him that taking over the Fed would cause the dollar to plunge while long-term interest rates soar as investors expect higher inflation.

Between Trump’s tariffs, the economic spillover from deportations and terrorization of immigrants and the attempt to politicize the Fed, the upside risk to inflation now looks very high. The bitter irony is that many Americans voted for Trump because they thought he would bring prices down.

Paul Krugman is a Nobel Prize-winning economist and former professor at MIT and Princeton who now teaches at the City University of New York's Graduate Center. From 2000 to 2024, he wrote a column for The New York Times. Please consider subscribing to his Substack, where he now posts almost every day.

Reprinted with permission from Paul Krugman.

My Mom The Black Republican Wouldn't Recognize Her Party Today

My Mom The Black Republican Wouldn't Recognize Her Party Today

If my mother were alive, she would be disappointed at what her Republican Party has become. But not surprised. She had witnessed the GOP inching its way toward scapegoating some Americans to score political points with others in the ’60s, ’70s and ’80s, and thought the tactic, while canny and often effective, betrayed longtime African-American Lincoln Republicans like herself.

During the holiday season, I think about my mom, who kept our sprawling, raucous clan together. No matter what was going on with all of our lives, we made our way to the old homestead — squeezing into the Baltimore row house as our families grew — and minded our manners at the dinner table.

After the meal and a few drinks, all bets were off. But looking back, it was usually unresolved personality frictions, not politics, that triggered the occasional tiff.

As a very young girl, because of my mother’s work supervising precincts on Election Day, I was pretty aware of how our democracy was supposed to work, so was as vocal about the news of the day as my elders at our gatherings. Our political differences were minor, especially when compared to reports of the testy exchanges of today, with families and the country at large contributing to Merriam-Webster’s 2024 word of the year: “polarization.”

One reason, I believe, was the diversity of views within the Democratic and Republican parties.

The Democrats’ tent was large enough to cover Sen. Hubert Humphrey of Minnesota, whose speech as a young Minneapolis mayor at the 1948 Democratic National Convention was pivotal in the party’s decision to add a civil rights plank to its platform; President Lyndon Johnson, who signed landmark rights laws in the 1960s; and the Southern senators who opposed and filibustered those bills.

The Republicans my mother admired were those who favored progress, such as Ed Brooke of Massachusetts, an African American senator who stood up to his party when he felt his duty demanded it, as when early on he called on President Richard Nixon to resign. In our state of Maryland, Republican Sen. Charles “Mac” Mathias carried on the tradition of moderate so-called Rockefeller Republicans, criticizing President Ronald Reagan’s rightward shifts.

My mother agreed. How could she go along, she told me, when during the 1980 campaign against President Jimmy Carter, Reagan laid bare the Southern Strategy employed by Nixon and others before him, invoking harmful racial stereotypes of “welfare queens” and a “strapping young buck” buying T-bone steaks with food stamps. He opposed civil rights bills and a federal holiday for the Rev. Dr. Martin Luther King Jr., before he signed it, with an insult.

It was ironic that as Reagan turned her off, he attracted so many of the Reagan Democrats who helped hand him victories. In Baltimore, we knew some of them well, the working-class white voters, some union members, who inhabited row houses similar to ours in neighborhoods we knew not to venture into.

Though many were Catholic just like us, when Lawrence Cardinal Shehan implored them and all citizens to support a proposed open-housing law that would forbid housing segregation in the city, he was booed and heckled, and received death threats.

My mother was practical enough to know that to a politician, a vote is a vote. But where did that leave her, she wondered, someone upstanding, who worked hard, including for her party, yet didn’t hear its candidates speaking to those like her, instead repeating hoary lies that made the lives of her loved ones more difficult?

This was a mother who packed her three oldest children off with love and anxiety when they marched for civil rights, who believed in their causes and took pride in the lessons she taught them about character and doing the right thing that inspired them.

She knew there were people like Donald Trump in the world and in her party. But I know she would have been appalled as his acolytes stomped through the U.S. Capitol with Confederate flags, breaking the law not in the name of justice but to thwart it, and received so little rebuke from Republicans driven by fear of one man.

As someone who would accept no excuses from any of her five children, she would just shake her head as Republican senators today fall in line, making excuses for the rogue’s gallery of Trump Cabinet hopefuls, making the rounds trailing pardons, sexual misconduct accusations and NDAs.

By 2024, dissenting voices in the party had disappeared, many choosing not to run for seats they could not possibly win. Trump demands loyalty, and party members comply, repeating the talking points he has dictated. They defend the unqualified crew the president-elect is foisting upon the American people, most of whom didn’t vote for him, after calling those with experience, education and a stacked resume DEI hires if they happen to be Black and a Democrat.

That’s what you get when the ever-present loudest voice in the room is a South African émigré who seems nostalgic for apartheid, and only too eager to replicate it in the U.S.

Mom was smart enough to have known what members of her own party would think of her, a Black election worker with integrity who chose truth over fealty every time.

I’ve written about the belief among many African Americans that the Democratic Party has taken its most loyal voting base for granted. It’s also true, and I’m sure mom would agree, that the GOP, counting on resentment and fear of the other, has run campaigns that view Republicans like my parents as collateral damage.

She wouldn’t be surprised, nor angry, since she was the sweetest person you’d ever want to know.

But saddened, for sure.

Mary C. Curtis has worked at The New York Times, The Baltimore Sun, The Charlotte Observer, as national correspondent for Politics Daily, and is a senior facilitator with The OpEd Project. She is host of the CQ Roll Call “Equal Time with Mary C. Curtis” podcast. Follow her on X @mcurtisnc3.

No, Donald Trump Didn't Win This Election By A 'Landslide'

No, Donald Trump Didn't Win This Election By A 'Landslide'

As the tallying of votes approaches finality, with no happy outcome for Democrats, the triumphal narrative proclaimed by Republican cheerleaders needs correction. There was no MAGA “landslide” on Election Night – unless, like so many other aspects of American life, we have decided to diminish what that term has always meant historically.

Donald Trump appears to have won the popular vote by just over two percent, according to the latest numbers published by the Cook Political Report, which netted him 312 electoral votes. While that represented a big improvement on Trump’s weak record in presidential runs (and certainly warrants deep Democratic introspection), it was far from anything that could be defined as a landslide. In California, where Kamala Harris won the state with nearly 60 percent, there are still more than three million votes yet to be tallied..

So let's nudge the Republicans and their media cheerleaders back toward reality.

The last time that a Republican presidential candidate achieved what we have traditionally called a landslide was in 1988, when George H. W. Bush defeated Michael Dukakis by eight percent of the popular vote and won more than 400 electoral votes. Ronald Reagan notched two landslide victories: the first in 1980, when he beat incumbent Jimmy Carter by more than nine percent in the popular vote and nabbed 489 electoral votes (although Carter was hobbled by the third-party candidacy of John Anderson, who got nearly seven percent); and the second four years later, when he crushed Walter Mondale with nearly 59 percent of the popular vote and carried every state except the Democrat’s Minnesota home.

And let’s not forget Richard Nixon’s similar trouncing of George McGovern in 1972, when the Republican won 520 electoral votes and 61 percent of the popular vote. (Tricky Dick resigned in disgrace two years later when after revelations about his cheating in that election and numerous other crimes.) Democrats have won big too, notably in 1964 when Lyndon Johnson won 486 electoral votes and more than 61 percent. The last Democratic victory that approached a landslide came in 1996, when Bill Clinton won reelection with 379 electoral votes and came in nine points ahead in the popular vote against the incumbent Bush (who also had to contend with self-funding third-party gadfly Ross Perot).

So no, Trump’s roughly two percentage points do not place him in that category. It’s scarcely more than half as big as President Joe Biden’s margin in 2020, which the MAGA Republicans have repeatedly insisted was no victory at all. Democrats are far more gracious losers (and winners) than the Trump Republicans, who don’t hesitate to threaten and employ violence when they don’t get their way. (Notice how all the pre-election claims of “fraud” suddenly vanish when they win?)

Whatever the final numbers say, this election was assuredly disastrous for the Democrats, the nation, and the world. The damage has only just begun and the recovery remains distant and uncertain. Yet there many signs that the Republican narrative is too simple and simply wrong – from the Senate races that Democrats won in four of the five battleground states to the ballot initiatives where Republican ideologues were defeated on paid family leave, private school vouchers, and especially abortion rights.

The other cliché that Republicans keep repeating as they yammer about their pseudo- landslide is “mandate.” But having lied about their intentions, pretending to disown the authoritarian Project 2025 agenda that they now openly embrace, they have no mandate.

Clarence Thomas

Is Clarence Thomas Grifting His Former Clerks? Via Venmo?

Supreme Court Justice Clarence Thomas is the gods’ gift to investigative reporters. The man has apparently not paid for a goddamned thing in his life since Ronald Reagan installed him in his first government position. His grift goes so deep, according to a new report in from The Guardian, that his powerful network of former clerks had to pay for the privilege of attending his Christmas party.

According to Venmo records reviewed by The Guardian, several former clerks who are now powerful attorneys sent payments to Thomas’s aide, Rajan Vasisht, who was in the job from July 2019 to July 2021 for a 2019 Christmas bash with the justice. The amount of money each sent to Vasisht’s Venmo account wasn’t disclosed, “but the purpose of each payment is listed as either ‘Christmas party’, ‘Thomas Christmas Party’, ‘CT Christmas Party’ or ‘CT Xmas party’, in an apparent reference to the justice’s initials.” Given that Vasisht was Thomas’ aide, scheduling his personal and official calendar and handling his correspondence, there’s no other reason for these high-powered Washington, D.C., lawyers to be sending him money.

Among those who sent money is Patrick Strawbridge, a partner at Consovoy McCarthy, who just secured a big win at the Supreme Court representing the anti-affirmative action group Students for Fair Admissions in its suit against the University of North Carolina. He has also worked for the Trump Organization, the Trump family, and Donald Trump, including representing Trump in his failed bid to keep his tax returns from becoming public—his first oral argument before the court. He clerked for Thomas in 2008-2009.

The Consovoy in Stawbridge’s firm is Will Consovoy, who was a fellow Thomas clerk in the same term. Consovoy also worked for Trump, trying to shield his tax records from then-Manhattan District Attorney Cy Vance Jr. Consovoy was originally lead counsel in the case overturning affirmative action, but withdrew from oral arguments at the court when he was diagnosed with brain cancer. He died earlier this year.

Other former Thomas clerks who sent "party" money include:

Kate Todd, who served as White House deputy counsel under Donald Trump at the time of the payment and is now a managing party of Ellis George Cipollone’s law office; Elbert Lin, the former solicitor general of West Virginia who played a key role in a supreme court case that limited the Environmental Protection Agency’s ability to regulate greenhouse gas emissions; and Brian Schmalzbach, a partner at McGuire Woods who has argued multiple cases before the supreme court.

Most of Thomas’ former clerks have landed in extremely influential positions thanks to their association with Thomas, and of course the Federalist Society that helped them get where they are now. A raft of them—about two dozen—ended up with Trump-appointed jobs, either in the administration or in the federal judiciary. In private practice, former Thomas clerks end up in the vast right-wing network of firms that help dark money groups manufacture court cases to do things like overturn decades of precedent in abortion protections, affirmative action, environmental and safety regulation. The Thomas alum are with firms that regularly go before the court and in judgeships on the lower courts, where they can help tee up cases to go to SCOTUS. It’s a right-wing judicial swamp.

Thomas has bragged about how he has the most diverse clerks from all backgrounds. “They are male, they are female, they are black, they’re white, they’re from the West, they’re from the South, they’re from public schools, they’re from public universities, they’re from poor families, they’re from sharecroppers, they’re from all over,” he said in 2017 while talking to students at the University of Florida Levin College of Law.

Thomas’ wife Ginni has also written about how the former clerks are like extended family and she’s the “den mother” to the group. She’s organized big reunions (which the clerks probably ended up paying for) and coordinated them all on Facebook. That ended up extending into soliciting their help with the insurrection, for which she had to apologize. Not that there weren’t insurrectionists in the group: John Eastman is among them. He’s facing potential disbarment in California for his part in the attempted coup, and because he has “repeatedly breached professional ethics.” It’s noteworthy Eastman’s “family” from his days clerking for Judge J. Michael Lutting in the mid-1990s included 2020 elector objector Ted Cruz, one of the only senators to back the 2020 scheme.

Whether the powerful, well-connected group of lawyers who paid for Thomas’ Christmas party breached those professional ethics is murky at this point. Kedric Payne, the general counsel and senior director of ethics at the Campaign Legal Center, told The Guardian that it is possible that this was simply a pay-your-own-way kind of Christmas party rather than them paying Thomas’ expenses. That would be different from a scheme of lawyers paying for access to a Supreme Court justice. “But the point remains that the public is owed an explanation so they don’t have to speculate.”

Yes, we are owed that explanation, and it’s not likely to be forthcoming. At the heart of this is Thomas’ unbounded propensity for grift, his never-ending grudge against everything, and his sense of entitlement—you see, he’s owed the lavish lifestyle his “friends” have provided him. If that includes making his extended “family” of clerks—more like a crime family—pay for the Christmas party he is hosting for them, so be it. He actually has a lot in common with Trump, doesn’t he?

This is precisely what the founders created impeachment for: Clarence Thomas. It is definitely time for Democrats to draw up those impeachment charges, even though it’s not going to happen. It can’t happen because Republicans are just as corrupt as he is. They aren’t going to let a little corruption between friends stand in the way of overturning progress case by case. But by keeping his scandals front and center, Democrats can make Republicans own him and his corruption.

The only solution to the problem of Thomas is a political one: Beat the Republicans and fix this. That means expanding the court to nullify his presence and ending lifetime appointments to the court so the likes of Thomas can’t happen again.

Reprinted with permission from Daily Kos.

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