Just another Dilma post!

Brazilian President Dilma Rousseff is in trouble.   Is she being treated  fairly?  It seems more in line with “kick me when I’m down”  than cleaning up government.  In fact, post Dilma, the government or at least the democratic process might be worse off.

I don’t know any better source than the New York Times, which now provides for free, an online collection of their articles,  bringing together insightful analysis:

New York Times Articles

Stay tuned,

Dave

 

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And after Dilma goes?

Brazilian President Dilma Rousseff isn’t accused of participating in the Lava Jato scandal.   There is zero evidence linking her to this.  Instead, she is accused of allowing  a  misleading presentation of the budget deficit by including funds from state-owned banks. Whether this was illegal will be hotly contested during the impeachment proceedings.  She claims other presidents have presented the budget in this manner. Opponents  claim this helped her win the election.

Brazilian Vice President Michel Temer and  Leader of the Lower House Eduardo Cunha might have something in common-  a desire to  quickly  end  the Lava Jato scandal to save themselves and/or their friends:

Dilma Rousseff’s Impeachment isn’t a coup, it is a cover-up

The conclusion of Brazilian journalist, Celso Rocha de Barros, is that after Dilma, there are a variety of tactics to “declaw”  the investigation.

So, Dilma becomes a scapegoat for all that’s wrong in Brazil, and the music plays on.

Stay tuned,

Dave

 

Supreme Court Immigration Case

Messy.  Immigration policy is always messy.  This case is messy.  Obama’s order did not legalize anyone, but deferred deportation for a small fraction of immigrants here illegally.  It is estimated that it applied to 400,000 of the 11 million illegal immigrants.  The question is whether President Obama has this authority.  The Obama administration is on the defensive because the Texas court says he doesn’t have this authority and this caused a temporary halt to the program.   A future president could rescind this order.

Illegal immigrants who qualify get the all important green card, with alien registration numbers,  just like permanent residents.   So, opponents of the order argue that this simply promotes illegal immigration to this country.  However, new arrivals or anyone coming after 2010 are excluded from this order.   Many will not qualify because of a lack of documentation showing that they were here in 2010.

The outcome could go 4-4,  5-3 or even 6-2,  with Roberts and Kennedy joining with the liberals.  But, many observers seem to go for the 4-4 verdict, which is a win for the states suing the government and an  end Obama’s executive action.

The case will be decided in June.   The best analysis of the issues comes from scotusblog.com as follows:

Scotusblog.com

Obama’s executive order included the words “lawfully present”  for people here illegally.   It was argued by the Solicitor General  the executive order might work equally well without these 2 words.   But, attorneys supporting Texas, insisted the order allowed people to be lawfully present, whether it was explicitly stated or by the rights created by the order.

I guess the SC has  the option of striking down the entire order because it is simple contradiction of the legal status of these immigrants, and beyond the authority of the President to change.

But, the executive branch has the obligation to carry out the laws passed by Congress- not enact laws to their own liking.  So, this is the basis for Justice Kennedy’s comment that the executive order turns  policy making upside-down. This comment coming from Justice Kennedy gives experts the feeling of a 4-4 decision with Justice Kennedy siding with conservatives.  Thus, the argument that Obama’s executive order runs counter to the wishes of Congress is strong.

Another problem is whether Texas can show grounds for bringing the lawsuit, based on the financial harm of having to provide driver licences to all the “legally present”  immigrants.  There was extensive discussion on this point.  Texas has a law in place permitting driver licences to those in the  “deferred status” category, so they would be financially burden unless they changed their laws in which case they could not sue the government.   Chief Justice Roberts aptly called this a Catch-22.

Transcript of Oral Arguments

Liberals seemed more receptive to the argument that the realities of the immigration policy,  11 million illegal immigrants, and funds  be sufficient to deport a fraction  of these immigrants, so prioritization is within the right of the executive branch.  The Solicitor General Donald Verrilli opened with this observation, but Justice Sotomayor brought it up again during questioning.

The case will likely be a critical one, as this order is seen as an expansion of the authority of the president particularly among Republicans.  It is seen as a pragmatic solution to a Congress deadlocked on immigration reform among Democrats.   An Executive Order is not a law, but a temporary measure- but once immigrants get their deferred status, I honestly can’t see any future president wanting to rescind this order.

Stay tuned,

Dave

 

 

Al Jazeera America – Off the Air

Al Jazeera American News ended its broadcast on April 12, 2015.

Al Jazeera America

It provided excellent unbiased, in-depth, accurate   and comprehensive news.  David Cay Johnston wrote a column that sums up my feelings:

The Way News Should Be Done

“Great journalism doesn’t always attract large audiences, ”   as Johnston wrote is the unfortunate truth.  Further he wrote of how AJAM grew as leader in journalism:  “In 2013, when many top television and print journalists were looking for jobs, AJAM snatched up superb talents — including John Seigenthaler, Joie Chen, Antonio Mora, Randall Pinkston and Ali Velshi, the best in his class at explaining personal finance and economics.”

Excellence in journalism gets awards rather than audiences.  Viewer comments mirrored my thoughts – what goes on in the world affects us- so we need to be better informed:

Viewer comments

My favorite by far, is from Jane Smith, who writes, “Please come back AJAM.”

The other major news stations’ problems  are all too obvious- they are more focused on entertainment.  They are obviously pandering to their audience. Republicans like Fox News, and Democrats like MSNBC.    So much “reporting” and so little solid, unbiased reporting.

My favorite news station right now is the BBC.    For finance, Bloomberg and CNBC still lead the pack.

Stay tuned,

Dave

 

 

 

Dilma Rousseff and Lava Jato

There is no evidence linking President Dilma Rouseff to the car wash scandal.   But, there is plenty of evidence linking others seeking her impeachment to this scandal,  including her vice president, Michel Temer.

But,  hopefully he does not follow Dilma out the door, as the next in line,  Eduardo Cunho, Speaker of the lower house, is being charged with money laundering in connection with the scandal.  An excellent article from the BBC is provided below:

Brazil Impeachment (BBC) 

Imagine you suspect your house was robbed, so you call the police, and they rob you for real.  I think this is the situation in Brazil.

The leaders  replacing Dilma may be worse than her.   Worse, the grounds for impeachment have been made too broad. The next president  must forever keep one eye on the politics of the lower house of congress.

The economy in Brazil is bad.  But, how much should be blamed on the president?  The past year was terrible for commodity prices, particularly oil and iron ore.  Everyone in Brazil knows how the government went on a  spending craze for new stadiums in 2014 prior to the World Cup.

But beginning late January to the first 10 days in January, oil prices have begun to recover.   The stock market, as measured by the index fund, EWZ in US dollars,  is up 51% in the last 3 months. The US market as measured by the S+P index is up 9% in the same period.   The real in the past week has risen 10% against the US dollar.   So, as Dilma is being shown the door,  I believe the economy of Brazil, which is a large part of the frustration with her,  is getting better.

Perhaps what went wrong, was the deterioration of the economy at a time of high expectations.  A 10% approval rating for President Dilma, is incredibly low.

There is an option to suspend President Dilma, for six months, with a simple majority.  I guess this would be the obvious choice if impeachment efforts fail to get the 2/3 needed to oust her.

Stay tuned,

Dave

 

Winning

Trump hit upon a very simple analogy to politics- sports.  You support your local team.  You don’t say anything good about the New York Yankees if you support the Chicago Cubs.

But Trump’s analogy just doesn’t work in politics.   What gets big results is diplomacy and consistency.  – and that  takes a lot of time and international cooperation.  You can’t slam China one day for currency exchange manipulation  with hostile trade  policies aimed at coercing them into changing, and then the next minute, expect their assistance in an embargo of goods to North Korea.  That’s Trump’s plan apparently.  It really makes no sense.

This “punch them in the mouth and then hug and praise them next , and ask them for a favor”  destroys trust and cooperation.

“To jaw-jaw is always better than war-war” is a famous quote from Winston Churchill.   International cooperation is a buzz word to many, but it is exactly what happens everyday in government.  A lot has happened in the last month that makes me optimistic.

It is not a case of wanting to win,  but how to do it.  The choice is “winning alone” or “winning together.”  The arrests of ISIL terrorists in Belgium made headline news.  But, the capture Khalid Al-Barnawi with Ansaru, a radical terrorist group associated with Boko Haram  in Nigeria and neighboring countries called for celebrations in the street.

“Put your money where your mouth is”, is a great saying.  The US  put a 5 million dollar bounty on Al-Barnawi’s capture.  It is obvious  terrorism doesn’t respect the boundaries of any country.    Boko Haram has caused the death of 17,000 people and caused millions to flee their homes.   Al-Barnawi- may you rest in peace along with your insane and barbarous gang of thugs.

The announcement that China was not going to import coal from North Korea, appears to be another big win for nuclear non-proliferation.  It is part of the UN sanctions against North Korea for their nuclear program.   I suspect a lot of credit goes to John Kerry and Sandra Powers (US Ambassador to the UN) for this  “win” – but it will be a long and frustrating road ahead.  A carrot and stick approach  must be applied and this requires cooperation of the major world powers working within the framework of the UN.  This is why the UN was created,  to resolve disputes without war.  You may get talks going through “stick” policy, but if the carrot isn’t there, nothing will change.    The carrot is a lifting of the sanctions, once North Korea gives up its nuclear weapons program and agrees to highly intrusive inspections.

The US international policy has been to villainize a country to a point, where there is no incentive to change.  The “jaws-jaws” approach has resulted in a better relationship with Cuba- and it was badly overdue. It will take time for many in the US to adjust to the new policy.    Efforts in international cooperation are really bearing fruits, with advances in world health and control of epidemics,  the space exploration and the international  agreements on  climate change.

Mr. Trump should know, the “jaw-jaw”  approach is working.  But, there are no quick wins, or home runs in diplomacy.  Translating talk into action takes time to achieve the necessary unity  and a lot of perseverance.

It is “together wins” not the US wins which will determine the future.

Stay tuned,

Dave

Richard Nixon and Dilma Rousseff

President Dilma Rousseff of Brazil is being compared to Richard Nixon.

Richard Nixon resigned and left office on August 9, 1974.  He was never impeached, nor was there ever a trial of impeachment.

Nixon resigned because it was likely he was going to be forced to leave office after a trial of impeachment.    There were numerous allegations made against him at the time, but it is likely the most serious one was directing his staff to keep the FBI from investigating members of the White House.  It would be called the Watergate cover-up scandal.

The most thorough study  of Watergate scandal was done by former White House Counsel, John Dean.  His 2014 book showed there was no evidence that President Nixon had prior knowledge of the break in of the Watergate offices.   Dean came to this conclusion after listening to many taped conversations in the  White House, which have be declassified and available to the public.

The crime in Nixon’s case, was obstruction of justice.  He was aware that payments were being made to the burglars  to buy their silence. After Nixon resigned, he would have likely been indicted and tried for obstruction of justice. However, President Ford gave him a full pardon, so there was no trial.

To the public, Nixon was being considered by many to be guilty of a crime he did not commit,  which was prior knowledge of the break in.  People thought he was guilty   because so many of his close associates were involved.   This is called “guilt by association” usually followed by “trial by the press” or today,  “trial by social media.”

President Dilma is also going through trial by social media. Second,  President Dilma also has attempted to shield Lula from the Lava Jato investigation by appointing him to the cabinet.   However, she obviously did not hide this fact, and thought it was legal.   The Supreme Court ruled against this appointment.

President Nixon also got overruled by the US Supreme Court when the Special Prosecutor subpoenaed   the White House tapes.   The US Supreme Court has made many ruling limiting actions of the president.   They stopped President Truman when he tried to nationalize the US steel mills, stating this was beyond his authority.  The Supreme Court is the final arbiter in conflicts between the Executive Branch and Lower Court decisions.

But Nixon secretly obstructed justice- and that proved to be his downfall.  And President Dilma?  The critical question going forward, is not whether she has made wrong decisions , but whether she knowingly violated the law.   Also, were these violations at a level that requires her removal.  Because once the senate starts lowering the standard on what is an impeachable offense,    Presidents can only serve as long as the congress allows them.  Congress can not lead a country, only cause a permanent state of chaos.    The mandate to govern the country is  given to the President by the people  through open elections once every four years.

A number of our more famous presidents would have not served out their terms, if  impeachment option was an easy option.  Most likely, the Senate would impeach Obama tomorrow if it could do so on purely political basis.

Stay tuned,

Dave

 

 

 

 

 

US Unemployment

Donald Trump says we shouldn’t believe US unemployment rates  is 5%.  He says the unemployment rate is really  around 20%.  The average investor knows 20%  is very evident with massive foreclosures and businesses closing up. The stock market is destroyed by even 10% unemployment.

The highest level of unemployment in the last 67 years has been 10.8% during Reagan’s administration. Many economic events occurring during Nixon and Carter’s administrations, likely contributed to this high rate.  Oil prices tend to go down with unemployment.  In the last 4 months, oil prices have been slowly moving up even with an oversupply situation.

Trump is quoted as saying:

The official jobless figure is “statistically devised to make politicians — and in particular presidents — look good.”

Unemployment rates are determined by the Bureau of Labor Statistics. They have been estimating unemployment on a monthly basis since 1948.  Now, with the internet, you can get all the BLS   monthly estimates from 1948:

Unemployment Rates

The unemployment estimates are done by career government employees with the objective of obtaining the best estimate of unemployment in the country.  A 5% unemployment rate sounds good, unless you live in a neighborhood where most of your neighbors are unemployed.  The 5% unemployment is a nationwide value,  and there are large variations depending on age and trade or educational skills.

There are other measures of  unemployment statistics calculated by the BLS.  The BLS has a budget of 618 million dollars and has 2,500 employees.

The BLS data are used by economists and financial analysts around the world. In  addition to the unemployment rate, they provide estimates of the Payroll Employment,  Consumer Price Index (CPI), Producer Price Index (PPI),   Productivity,  US Import Index  and US Export Index.

Stay tuned,

Dave

 

Zubik v. Burswell- Another Supreme Court Challenge to Obamacare

” Clowns to left of me, jokers to the right, Here I am, stuck in the middle with you.”  Lyrics-  Steve  Healy  band.

The “you” in Steve Healy song, are the plain facts about the latest case to come before the Supreme Court. Most people are not interested in facts.  The clowns and jokers are far more entertaining for their 90 seconds of fame.   I dedicate this blog to my favorite clown/joker Graham Ledger, truly outstanding for his total certainty on topics of which he has no real knowledge.  One day it will be Iran, the next Obamacare or the deficit.  He is a truly non-stop Obama basher.  When lesser minds prevail, God save us all!

Oral arguments were held on   March 24,  in Zubrik v Burswell in the Obamacare case.

ZUBIK ORAL ARGUMENTS

We think of religious freedom as guaranteed under the First Amendment.  In fact, our rights are further extended and defined by many other laws and rulings by the courts.  Religious freedoms, as with every right in the Bill of Rights, are limited.   You may not refuse to pay your taxes, because that is a violation of your religious principles.   If your religious principles says that you can not hire blacks or Muslims in your business, the laws related to race and religious discrimination will likely supersede these religious beliefs.

I will examine religious freedoms in a separate blog.  It isn’t as Ted Cruz or Graham Ledger portray it.  They extract from many cases,  a  select few concerning Catholics and ignore many other cases from lesser religions.

But the Zubrik case involves  the extend of religious accommodations based on  the Religious Freedom Restoration Act (RFRA which the justices refer to  as “ree fra).  It is not a constitutional case. This is the mistake made by conservative commentators on Fox News and One American News.

It is about whether  accommodations made in the ACA (aka Obamacare) for those seeking exceptions to the contraceptive program are adequate.  Or do these accommodations in fact become  burdensome as the plaintiffs claim.    In attempting to enforce the RFRA, could the court go as far as say anybody could opt out of any part of Obamacare, because in their minds, it conflicts with their religious beliefs? In doing so, what is slowly eroded is this notion of a standard set of benefits,  independent of the provider of the insurance.  Of course, this is exactly what those opposed to Obamacare want.

A lot of Supreme Court observers expect the court will divide 4-4 in which case, the lower court cases stand.  I believe it will be a 5-3 decision, with Justice Anthony Kennedy siding with the liberal group. It is possible that the decision will be 6-2, with both Roberts and Kennedy joining the liberal side. There is a final option to hold over the case,  in hopes that the Congress will approve a new justice.

We shall find out in June, 2016.

In the next few blogs, I hope to go a bit deeper into religious freedom.  It is crazier than you think!

Stay tuned,

Dave