Jul. 13



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Dem pickups: (None)
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Secretary of Labor Strikes Out

It did not matter much when Democrats started calling for Secretary of Labor Alex Acosta to resign due to his handling, when he was a U.S. Attorney, of the case of sexual predator Jeffrey Epstein. When many Republicans, both in Congress and the media, joined the chorus, he was in trouble. And his general lack of popularity in the White House, coupled with the tepid support of Donald Trump, was the final straw. Seeing the writing on the wall, Acosta resigned early Friday morning.

Officially, everyone said the "right" things after the announcement was made. Acosta claimed that this was entirely of his volition, and that the President did not pressure him to resign. Trump said that he was really sorry to see Acosta go. Needless to say, all of this is just spin. The relationship between the two men has reportedly been strained for many months, and the President was very upset at all the negative coverage that Acosta was attracting. The odds are pretty good that Acosta's fate was sealed two or three days ago, and that he waited to resign until the absolute deadest part of the weekly news cycle (right after Friday editions had come out, but also right before the weekend.)

Acosta's replacement, at least on an acting basis, is Patrick Pizzella, who has been deputy secretary for a little over a year. Given this administration's well-established priorities, it should come as no surprise that he has a long record of being pro-management and anti-labor. Trump told reporters on Friday that Pizzella comes "highly recommended by Alex." It seems a bit strange to be seeking input from someone who just had to quit in disgrace, but there it is. Assuming no skeletons emerge from the closet, we're going to go out on a limb and predict that the Senate confirms Pizzella 53-47.

Acosta may not be the only cabinet-level official to be sent packing this weekend, incidentally. Director of National Intelligence Dan Coats is reportedly on the hot seat. Trump and Coats have never had a good working relationship, and the President considers his DNI to be one of those troublesome types who won't tell him what he wants to hear and who tries to rein in his worst excesses. That won't do, and so it would be no surprise if Trump pulled a two-fer this weekend, and got all of the "cabinet instability" stories out of the way all at once. And on that point, the departure of Acosta means that Trump has already lost more cabinet officials in his first term than any of his five immediate predecessors. That despite the fact that he still has 1-1/2 years to go in this term.

Meanwhile, the Epstein story isn't going away anytime soon. Beyond the fact that it's as salacious as it gets, there's also an aspect of the story that is currently being underreported: The size and exact source of Epstein's fortune is more than a little mysterious. Officially, he's a billionaire who acquired his wealth as a mutual fund manager. However, the details of his biography don't really add up, most obviously that nobody on Wall Street has ever done business with him. It is not too easy for someone to make a billion-dollar fortune (or even a $50 million fortune) on the Street without leaving any traces like that. The widely held suspicion is that Epstein is engaged in blackmail, money laundering or, more likely, both. The theory is that he would get dirt on a wealthy person (video or photos of them engaging in illegal sexual acts, for example) and then would suggest they invest some money in his "hedge fund" in the Virgin Islands. Epstein and the wealthy person would both make money, the funds would be laundered, and the dirt would remain hidden.

Anyhow, if this is even partly true, it would potentially mean that Epstein has all kinds of dirt on people that he might use to try to save himself. It's also within the realm of possibility that, if there really were blackmail materials, the authorities now have them, and that it will not matter if Epstein turns stool pigeon or not. It's true that all of this is highly speculative at this point, but it's also true that where there's a little smoke there's sometimes a lot of fire. If this site had existed 50 years ago, our June 18, 1972, posting might not even have mentioned a little break-in at an office building in Washington. Or, if we did cover it, it probably would have been the sixth or seventh item on the page. And yet, that was the starting point for the political scandal of the century.

If any other political figures are caught up in Epsteingate, who might they be? Obviously, there's Donald Trump, who definitely had ties to Epstein (and that's before we talk about exactly what kind of business Epstein was in). Bill Clinton, too, though even if he turns out to be one of the leches who participated in Epstein's crimes, it's hard to know exactly what effect that would have on current politics. Lawyer Alan Dershowitz, former liberal and current defender of Trump, was friends with Epstein and has been accused by two women of accepting coerced sex. Trump adviser Tom Barrack was once chummy with Epstein, and Attorney General William Barr has connections from long ago linked to his legal work.

Speaker Nancy Pelosi's (D-CA) daughter, Christine, sent out a widely-circulated tweet earlier this week:

This Epstein case is horrific and the young women deserve justice. It is quite likely that some of our faves are implicated but we must follow the facts and let the chips fall where they may - whether on Republicans or Democrats. #WeSaidEnough #MeToo https://t.co/2mvskwQwW1

— Christine Pelosi (@sfpelosi) July 7, 2019

Undoubtedly, most people agree with this sentiment. That said, Epstein's address book has already been made public, so if there are political figures (Republican or Democrat) who had ties with him over and above the folks noted above, those ties are pretty deeply hidden. (Z)

Another Budget Mess Is Looming

There was a time when setting the annual budget for the federal government was not that difficult, and was generally done well in advance of the new fiscal year. Perhaps we will return to those days once again, sometime in the distant future, but we're not there now. And the next budget could possibly be even more of a fiasco than the last one (which, of course, triggered the longest government shutdown in U.S. history).

There are a lot of moving pieces here, but the three most salient facts are these:

• Treasury Secretary Steven Mnuchin announced on Friday that the U.S. government is going to run out of money much sooner than expected, and that the wallet might be empty as soon as early September. That's well before the government's fiscal year begins on October 1, and is also not long after the House returns from a six-week summer recess that runs from the end of July to the middle of September. The unexpected shortage is, not surprisingly, a byproduct of the GOP tax cut, which has caused the federal budget deficit to increase by more than 23% relative to last year.
  
  
• In order to rectify this problem, it will be necessary for Congress to raise the ceiling on how much the government can borrow. The administration would like to do this as a standalone vote, but is getting pushback from both parties in Congress, who only want to do it as part of the budget bills. The Republicans' reason is that if they vote solely to raise the debt ceiling, that vote will hurt badly with voters back home. The Democrats' reason is that the debt ceiling gives them leverage to get their spending bills signed into law.
  
  
• On Friday, the House passed the most significant annual spending bill, namely the one that sets appropriations for defense. It allocates $733 billion for that purpose, and even has some money for Donald Trump's space force. That said, the President is going to hate, hate, hate the bill. First, because he wanted $750 billion, not $733 billion. Second, because the bill has a lot of provisions meant to rein the President in, like a ban on using military funds to build a border wall, a requirement that Congress approve any military action against Iran, and a reversal of the ban on transgender soldiers.

In short, the pieces are all in place for another game of budget chicken.

But will we actually have a repeat of last December's fiasco? Nancy Pelosi took a defeat on last month's border aid bill, but she's got most of the cards in her hand this round. Since her caucus has already passed the defense bill, and is surely ready and willing to pass the other bills needed for FY 2019-20, it's going to be rather difficult for Trump to demand that the debt ceiling be lifted separate of passing the budget, or for him to pin the blame on the Democrats if the government defaults on its obligations and is forced into a partial or complete shutdown. Plus, he's going to have six weeks to stew in his juices while the House is adjourned, only to return shortly before the government's coffers reach zero. Given how badly it went the last time he dug in, and given that he's trying to appear more centrist and statesmanlike in advance of the 2020 election, he may just decide to give in on this one. (Z)

Mueller Testimony Delayed, Expanded

Former special counsel Robert Mueller was supposed to speak to two different House committees on July 17 (i.e., Wednesday of next week). He wanted more time to prepare, however, while the Judiciary Committee wanted to make sure that there was time for all 41 members to ask questions. Yesterday, a deal was struck: Mueller's testimony will be moved to July 24, and in exchange he will appear before the Judiciary Committee for three hours (up from the two hours originally planned), then will speak to the House Intelligence Committee for another two hours (the same amount of time as originally planned).

Overall, this is pretty good news for anyone who does not want impeachment, a list that currently includes both Donald Trump and Nancy Pelosi. Two days after Mueller's testimony, the House will begin its six-week summer recess, and so it will be a little harder for his words to percolate among members of the Democratic caucus and to cause them to come out in favor of impeachment. Also, the next set of Democratic debates are set for July 30-31. That, plus the July 28-29 weekend likely means that heavy coverage of Mueller's testimony is going to be limited to two days. Trump would prefer zero days, of course, but if the former special counsel is going to talk anyhow, two days of coverage is not likely to do too much damage to the President. (Z)

Today's Legal Blotter

As we have noted, it's a rare day (or, at least, a rare weekday) that does not seem some sort of development in the legal realm that is related to Donald Trump and/or his administration. On Friday, there were three of them.

The first came from the D.C. Circuit Court of Appeals, where a three-judge panel heard the appeal of an earlier ruling that House Oversight Chair Elijah Cummings (D-MD) is entitled to subpoena Trump's financial records. Judging by their questions, the judges were not impressed with Team Trump's arguments. For example, Judge David Tatel (a Bill Clinton appointee) opined that Cummings appears to be pursuing normal financial disclosure, and not something out of the ordinary. Expect a ruling, adverse to Trump, sometime next week, followed by an appeal to the Supreme Court.

That wasn't the only unhappy news for the President. As part of a lawsuit targeting the administration's treatment of children at the border, Team Trump was forced to agree to allow Stanford pediatrician Dr. Paul Wise to tour detention facilities and to report back to the court. Wise was previously very critical of what he saw during a tour of a facility, so he is not going to pull any punches when he next chats with Judge Dolly Gee.

And finally, Trump also got a little bit of good news on the legal front, as federal prosecutors in New York said they do not expect to charge the management of the Trump Organization for any wrongdoing related to the 2016 campaign. Of course, that does not mean that Trump Organization pooh-bahs won't get charged for other things, or that other members of the campaign won't get charged, so it's a somewhat narrow victory. Still, the President will surely take whatever wins he can get. (Z)

Pennsylvania GOP Gets Its Act Together

Recall James Carville's observation that Pennsylvania is basically Pittsburgh and Philadelphia with Alabama in between. That means that the state's Republicans have a tricky relationship with Donald Trump, as some of them (the "Alabama" residents) love him, while others (the city dwellers) are generally less enthused. This divide produced a nasty, internecine struggle within Pennsylvania GOP leadership, as one pro-Trump person (Bernadette "Bernie" Comfort) and one not-so-pro-Trump person (Lawrence Tabas) fought for the right to succeed Val DiGiorgio as chair of the state party.

This dispute has now been resolved with a power-sharing agreement, by which Tabas will become chair of the state party, but Comfort will be vice-chair, as well as chair of the Pennsylvania branch of Trump 2020. The President took to Twitter to celebrate this result:

We have a GREAT TEAM in Pennsylvania! I’m proud to say that our good friends Lawrence Tabas & Bernadette “Bernie” Comfort will now be working together to run the @PAGOP. Lawrence will be Chairman & Bernie will Chair my Pennsylvania Campaign. We must have, & do, great UNITY in PA!

— Donald J. Trump (@realDonaldTrump) July 12, 2019

In the short term, Trump has been spared a headache, and possibly an embarrassing defeat. Long term, there's a reason that they say that too many cooks spoil the broth. This kind of power-sharing often works poorly, particularly when the two folks who are sharing power most certainly do not see eye-to-eye. Trump will really need to hope that Comfort and Tabas work well together, though, because he barely won the Keystone State in 2016, and he really needs it again in 2020. (Z)

Democratic Presidential Candidate of the Week: Tom Steyer

Steyer fooled us by "dropping out" a few months back, so we never did a profile of him. But now that he's in, here it is.

• Full Name: Thomas Fahr Steyer
  
  
• Age on January 20, 2021: 63
  
  
• Background: Born to a well-to-do middle class family in New York City, Steyer's mother was a teacher while his father was a lawyer (who earned some fame prosecuting ex-Nazis during the Nuremberg trials). After attending top-tier elementary and prep schools, Steyer graduated from Yale with honors, and with degrees in economics and political science. He took a job on Wall Street with Morgan Stanley, hated it, and relocated to California to attend Stanford Business School. After finishing his MBA, Steyer spent the rest of his business career in San Francisco, working for several brokerages, and then founding his own investment firm, Farallon Capital. By the time he retired from Farallon in 2012, the firm was managing $20 billion, and he was worth more than $1.5 billion.
  
  Steyer's second career has been as an activist. Influenced profoundly by a conversion to his mother's Episcopalianism (his father was a non-observant Jew), he's had an impressive string of successes (aided substantially by his fat bankroll, of course). Steyer and his wife have, among other things, founded a bank (Beneficial State Bank) that loans money to low-income individuals, lobbied extensively for environmental legislation through their PAC NextGen America, helped close loopholes in California's tax code, established a program called "California Food for California Kids" that serves locally-sourced food to California schoolchildren, and created the TomKat Center for Sustainable Energy at Stanford University.
  
  
• Political Experience: If you count work as a fundraiser, lobbyist, and activist, then read the previous paragraph. If you don't, then he has no political experience.
  
  
• Signature Issue(s): In the last year or so, Steyer has spent a great deal of money on "impeach Trump" advertising. So, he might be planning to focus on that. However, his website suggests his main issue will be a series of "draining the swamp" structural reforms to the U.S. political system.
  
  
• Instructive Quote: "The whole key to a fight is throwing the first punch."
  
  
• Completely Trivial Fact: Steyer donated more money to political candidates than any other individual donor during the 2014, 2016, and 2018 campaign cycles. On the other hand, unlike some wealthy-men-turned-politicians, Steyer has little interest in the trappings of wealth. His car, for example, is a hybrid Honda Accord.
  
  
• Recent News: He only declared this week, so there hasn't been much time for him to generate other kinds of news stories. However, a major theme in the coverage is whether or not he will do more harm than good to the causes he cares about by throwing his hat into the ring.
  
  
• Three Biggest Pros for the General Election: (1) It's nice to be able to fix one's fundraising problems by just getting out one's checkbook; (2) He knows how to organize people and get them working together toward a shared goal; and (3) He's not a politician, so he thinks what he says, and says what he thinks.
  
  
• Three Biggest Cons for the General Election: (1) Like a Senator who has a lengthy voting record that could come back to haunt them, some of Steyer's investments while in business (in petroleum and privatized prisons, most obviously) could cause some Democrats to look askance at him; (2) The GOP and the right-wing media would have an absolute field day portraying him (not without evidence) as a lefty pinko; and (3) He's not a politician, nor a former reality TV star, so he's got virtually no public speaking or on-camera experience, and a presidential campaign is not the place to learn.
  
  
• Is He Actually Running?: He is, and he says he's going to spend $100 million as part of his bid.
  
  
• Betting Odds: He's getting anywhere from 100-to-1 to 50-to-1, which implies a 1-2% chance of landing the nomination.
  
  
• The Bottom Line: Steyer clearly plans to hang on beyond the time that the field shrinks, using his money to keep his campaign afloat, and then to become something like the 2020 version of Bernie Sanders, prodding the candidate(s) leftward. He cannot possibly think he has a shot at the White House.

You can access the list of candidate profiles by clicking on the 2020 Dem candidates link in the menu to the left of the map. (Z)

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