Krebs Daily Briefing 14 March 2016

Thomas L. Krebs, Securities Litigation, Regulation and Compliance Attorney Lawyer (c)2014 Brandon L. Blankenship
Thomas L. Krebs


To Maintain Supply of Sex Slaves, ISIS Pushes Birth Control

DOHUK, Iraq — Locked inside a room where the only furniture was a bed, the 16-year-old learned to fear the sunset, because nightfall started the countdown to her next rape.During the year she was held by the Islamic State, she spent her days dreading the smell of the ISIS fighter’s breath, the disgusting sounds he made and the pain he inflicted on her body. More than anything, she was tormented by the thought she might become pregnant with her rapist’s child. It was the one thing she needn’t have worried about.

Soon after buying her, the fighter brought the teenage girl a round box containing four strips of pills, one of them colored red. “Every day, I had to swallow one in front of him. He gave me one box per month. When I ran out, he replaced it. When I was sold from one man to another, the box of pills came with me,” explained the girl, who learned only months later that she was being given birth control. It is a particularly modern solution to a medieval injunction: According to an obscure ruling in Islamic law cited by the Islamic State, a man must ensure that the woman he enslaves is free of child before having intercourse with her. Islamic State leaders have made sexual slavery as they believe it was practiced during the Prophet Muhammad’s time integral to the group’s operations, preying on the women and girls the group captured from the Yazidi religious minority almost two years ago. To keep the sex trade running, the fighters have aggressively pushed birth control on their victims so they can continue the abuse unabated while the women are passed among them. More than three dozen Yazidi women who recently escaped the Islamic State and who agreed to be interviewed for this article described the numerous methods the fighters used to avoid pregnancy, including oral and injectable contraception, and sometimes both. In at least one case, a woman was forced to have an abortion in order to make her available for sex, and others were pressured to do so.

Oil back below $40 as Iran dashes hopes for quick deal on output

Oil fell around 3 percent on Monday after Iran dashed hopes of a coordinated production freeze any time soon, returning bearish sentiment to the market over a supply glut that has sent prices crashing.

Global benchmark Brent crude futures LCOc1 fell back below $40 a barrel, trading at $39.20 at 1157 GMT, down $1.19 on Friday’s close. Brent hit a 12-year low of $27.10 in January. U.S. crude CLc1 was down $1.13 at $37.37 a barrel. “Oil is down because Iran said they would only join the output freeze group once they reached production of 4 million barrels a day (bpd),” said Tamas Varga, oil analyst at London brokerage PVM Oil Associates. He was referring to comments by Iran’s oil minister Bijan Zaganeh on Sunday that the OPEC member would join discussions after its output reached that level.

Iran’s oil exports are due to reach 2 million bpd in the Iranian month that ends on March 19, up from 1.75 million in the previous month, he said. Zanganeh is meeting Russian counterpart Alexander Novak in Tehran on Monday. Saudi Arabia appeared to have stuck to a preliminary deal with some other producers to freeze output, as its crude production held steady in February at 10.22 million bpd, an industry source told Reuters. OPEC members and non-OPEC producers are likely to hold their next meeting to discuss an output freeze in mid-April in Doha, OPEC sources told Reuters. A March 20 meeting in Russia, which was part of an earlier plan, now looks unlikely. Worries about demand fundamentals moved back into the spotlight as investment bank Morgan Stanley warned that a slowing global economy and high production would prevent any sharp rises in oil prices. “Oil prices now seem to have bottomed, even though they are likely to stay subdued for the rest of this year before starting to move higher in 2017,” the U.S. bank said in a research note. It added that cheap oil had not provided the boost to growth that many had hoped for.

“When oil prices are falling below production costs, the income gains for consumers will be smaller than the costs to producers, and falling oil prices become a negative-sum game,” it said. In a sign that investors are growing more skeptical about a rebound in oil prices, ICE data showed on Monday that speculators had cut net long Brent crude positions by 9,500 contracts in the week ending March 8.


Conservatives Face an Impossible Choice

The accelerating likelihood that Donald Trump will win the Republican presidential nomination outright thrusts an agonizing dilemma on Republican politicians. Leave aside their own personal feelings about Trump. The most likely consequence of a Trump nomination is a severe Republican defeat in November, and not a defeat for Trump alone. Some significant number of Republicans just won’t vote for Trump. When people don’t want to vote for the top of a ticket, they often stay home altogether, dooming every close race lower down on the ticket. Republicans have Senate seats at risk in Florida, Illinois, New Hampshire, Ohio, Pennsylvania, and Wisconsin—sufficient to put the Republican majority in question. The House looks safer, as does the Republican hold on state governments, but who knows? Trump is most objectionable to the most reliable and loyal Republican voters, exactly the kind of people who vote Republican for every office all the way down to county commissioner. Perhaps the very most reliable and most loyal will show up no matter what, skip the top line, and otherwise vote the straight ticket. Or perhaps not. So talk is rising in the Republican world of some kind of independent candidacy, using some minor-party ballot line. It’s hoped that such a candidate—Senator Ben Sasse from Nebraska? Mitt Romney?—would offer anti-Trump Republicans a reason to show up to vote, and thus save the Senate.

That’s the hope. But the third-party solution has risks, too, bigger risks than anyone is calculating right now. When people bolt their party, the party changes behind them. Take, for example, the Progressive Republicans. When they bolted the party to follow Teddy Roosevelt’s independent campaign in 1912, they left conservatives in control of the Republican apparatus. Before 1912, it was very much an open question whether the reformist movements of the 20th century would find their home in the Republican or Democratic Party. After 1912, the most important of those reforms would be carried out at the federal level by Democrats, and opposed by Republicans. When Republicans regained the White House in 1920, it would be under the leadership of the man who’d delivered the nominating speech for William Howard Taft at the 1912 convention. The young people who’d looked to Teddy Roosevelt for change in 1912 would in many cases end up as followers of his cousin Franklin in 1932—most notably, the former Bull Moose who ran most of the early New Deal, Interior Secretary Harold Ickes. More:

Here’s What Warren Buffett Thinks Caused the Financial Crisis

Buffett admits that he didn’t see the financial crisis coming until it was too late. The National Archives on Friday released a bunch of new interviews and other documents that came out of the Financial Crisis Inquiry Commission. The FCIC interviewed lots of people about the financial crisis, everyone from CEOs like Goldman Sachs’ Lloyd Blankfein toThe Big Short author Michael Lewis. Among the interviews released on Friday was one conducted with legendary investor and CEO of Berkshire Hathaway Warren Buffett. In the interview, which took place in May 2010, Buffett admits that, like most everyone else, he didn’t see the financial crisis coming until it was too late. Buffett also says that, while he didn’t know what the government would do, his investments during the financial crisis in General Electric  GE 1.34%  and Goldman Sachs  GS 1.93%  were essentially based on the belief that the government wouldn’t let such big firms fail. Buffett also gave a long, thoughtful response to the question of what caused the bubble that caused the financial crisis. Here’s a transcript:  Brad Bondi [financial crisis inquiry commission]: What do you think it was, if you were to point to one of the single driving causes behind this bubble? What would you say? Warren Buffett: Well, there’s a very interesting aspect of this, which will take a minute or two to explain; but what my former boss, Ben Graham, made an observation, 50 or so years ago to me that it really stuck in my mind and now I’ve seen evidence of it. He said, “You can get in a whole lot more trouble in investing with a sound premise than with a false premise.” If you have some premise that the moon is made of green cheese or something, it’s ridiculous on its face. If you come out with a premise that common stocks have done better than bonds—and I wrote about this in a Fortune article in 2001—because there was a famous little book in 2001 by Edgar Lawrence Smith—in 1924 by Edgar Lawrence Smith that made a study of common stocks versus bonds. And it showed—he started out with the idea that bonds would over perform during deflation and common stocks would over perform during inflation. He went back and studied a whole bunch of periods and, lo and behold, his original hypothesis was wrong. He found that common stock always over performed. And he started thinking about that and why was that. Well, it was because there was a retained earnings factor. More:

Goldman revamps electronic stock trading to catch rival

Raj Mahajan achieved a rare when he rejoined Goldman Sachs Group Inc (GS.N) last year with the coveted title of partner, the Wall Street bank’s highest rank. Then he got to work on fixing the pipes.

That plumbing has to do with the technology Goldman uses to route stock orders to exchanges and private trading pools. The bank has long been one of the top two stock brokerages in terms of revenue and customer rankings. But in recent years Goldman’s status slipped in electronic trading because its technology did not keep up with client demands for ever-faster trades. Goldman hired the tech-savvy Mahajan to revamp the business in March 2015. Since then, he has hired dozens of technologists and support staff to elevate Goldman’s position in a fast-growing slice of the market and win back business from its chief competitor, Morgan Stanley (MS.N). “When we look at how Goldman wants to be positioned for the future, simply put, we want to deliver the best execution quality to our clients, which is tantamount to saying we need the best technology,” Mahajan said in an interview. The 43-year-old was promoted to co-head of global execution services last month. He began his career at Goldman Sachs in 1996 as a commodities analyst, but left the bank in 2000 to launch a trading technology firm with R. Martin Chavez, who is now Goldman’s chief information officer. Their startup, Kiodex, was bought in 2004 by financial software maker Sungard, where Mahajan became president of global trading. He later became chief executive officer of high-frequency firm Allston Trading before rejoining Goldman as partner, a rank held by around 1.5 percent of Goldman employees. Mahajan said the idea of fixing the cracks in Goldman’s pipes to make trades move faster and more efficiently find the best liquidity is what motivated him to return. “I thought that played right into my skills,” he said. More:

What Would Breaking Up the Banks Even Look Like?

When regulators from around the world—including the U.S. and the E.U.—determined in 2008 that the banking system was terribly under-regulated, they all suggested a similar fix: Separate the departments involved in investment banking from those that deal with more run-of-the-mill insured deposit-taking. But recently there has been some back-sliding on such separation, and finance is still dominated by giant banks that mix the two. Yet separation makes a lot of sense. Why should to two such wildly different activities as investment banking and retail banking be bundled together in the same institution? It’s obvious what JPMorgan gains: a nice piece of ballast to offset embarrassing, high-stakes trading mishaps. But what about consumers? How does an ordinary person benefit from putting her deposit into a complex global bank? I have asked that question to experts for more than a decade and have yet to hear a satisfying answer. Breaking up the banks in this way isn’t a proposal confined to the political fringes. Neel Kashkari, the president of  the Federal Reserve Bank of Minneapolis—as well as a former banker and a Treasury official during the brunt of the crisis—argued in a recent speech that the too-big-to-fail problem has not been solved by current regulation: The failure of more than one bank in an economic downturn would still have enormous economic costs. His suggested options include breaking up large banks, turning large banks into public utilities, and taxing leverage to reduce systemic risk. He gave short shrift to those who argue that remedies like this could be disruptive, saying, “Those potential shortcomings must be weighed against the actual risks and costs that we know exist today…Better and safer are reasons enough to act.” More:


Justice Department warns local courts about unlawful fines and fees

 The Justice Department is asking local courts across the country to be wary of how they slap poor defendants with fines and fees to fill their jurisdictions’ coffers, warning that such practices often run afoul of the U.S. Constitution and have serious real-world consequences. In a letter that will be sent Monday morning to the chief judges and court administrators in all 50 states, Vanita Gupta, the head of the department’s Civil Rights Division, and Lisa Foster, director of the Office for Access to Justice, wrote that illegal enforcement of fines and fees had been receiving increased attention in recent years, and the Justice Department had a “strong interest” in making sure the rights of citizens were protected. “Individuals may confront escalating debt; face repeated, unnecessary incarceration for nonpayment despite posing no danger to the community; lose their jobs; and become trapped in cycles of poverty that can be nearly impossible to escape,” Gupta and Foster wrote. “Furthermore, in addition to being unlawful, to the extent that these practices are geared not toward addressing public safety, but rather toward raising revenue, they can cast doubt on the impartiality of the tribunal and erode trust between local governments and their constituents.” The letter begins with the phrase “Dear Colleague,” and it does not threaten any specific enforcement action for those who ignore it. Officials said, however, it is an indication that the Justice Department is stepping up its efforts on the problem of local court fines and fees. Department officials will also announce Monday that they are making $2.5 million in grant funding available for jurisdictions with plans to “test strategies to restructure the assessment and enforcement of fines and fees.” “We believe strongly the Constitution needs to be upheld in every court in every place in the United States, so we’re trying to help make sure that comes to pass,” Foster said in an interview.

The White House and the department convened a summit on the issue in December with advocates and court officials, and the Justice Department alleged in a recent lawsuit that officers Ferguson, Mo., were violating citizens’ civil rights in part because their policing tactics were meant to generate revenue. More:


Inside Kasich’s long-shot strategy to beat Trump to the GOP nomination

 Microphone in hand, Republican John Kasich promised the crowd inside a high-tech Ohio factory Saturday that he’ll never be beholden to Washington insiders if he wins the White House in November.

But as he zigzags across the state before Ohio’s GOP primary on Tuesday – emboldened by polls showing him edging ahead of rival Donald Trump – Kasich may soon need all the Washington insiders he can get. Behind the scenes, strategists for Kasich, the Ohio governor, are studying arcane party rules that they believe could offer a path to the Republican nomination if he wins his home state, his aides said.

It is a long-shot strategy, both for Kasich and the anti-Trump forces inside the party. But if fellow GOP candidate Marco Rubio loses his own state of Florida on Tuesday – as polls predict – a surge by Kasich may be the only viable strategy for Republicans looking to stop Trump from getting the 1,237 delegates needed to clinch the nomination. A loss by Rubio, a senator, will almost certainly end his struggling candidacy. If Trump wins both Ohio and Florida, the New York real estate mogul’s march to the nomination will be all but assured. The Kasich camp sees a Rubio loss in Florida opening up a different possibility – the first contested convention held by either party since 1952. “The plan is to win Ohio, and some other states, and if that happens, nobody is going to have enough delegates to win the nomination on the first ballot,” said John Weaver, Kasich’s chief campaign strategist, who also worked on Republican Senator John McCain’s losing presidential campaigns in 2000 and 2008. Kasich supporters are betting that an Ohio win will give his candidacy its first real momentum, attracting donors and endorsements. From there, he could score more victories in upcoming primaries in Pennsylvania, Maryland, Wisconsin, Connecticut and California, states where Kasich polls favorably. He has almost no hope of winning enough delegates to secure the nomination outright. But if he can succeed in blocking Trump from getting a majority, Kasich can make a case to convention delegates that he is more electable than Trump or Ted Cruz, the conservative evangelical from Texas and, to date, Trump’s most successful Republican rival.


Campaign 2016 is on a dangerous descent

VANDALIA, Ohio — Friday was an ugly day on the campaign trail, perhaps the worst of the year. What erupted in St. Louis and fully boiled over later in Chicago, however, was no aberration. Donald Trump has built his candidacy on long-festering resentment and grievance. It is a poisonous combination, for the Republican Party and for the country. Trump’s slogan is Make America Great Again, but his campaign for president continues to call out dark forces that divide a polarized America. Fueled by acrimonious rhetoric, he has sparked an angry movement that has now created an angry backlash. Campaign 2016 is on a downward and dangerous descent. The videos of the conflicts ahead of Trump’s rally in Chicago on Friday evening triggered memories of the far-worse bloody clashes at the 1968 Democratic convention in the same city, when the United States was engulfed by violence and protests over the war in Vietnam. The flash points in today’s politics are more diffuse, but the political divisions are no less real. Trump seems unwilling to try to put the genie back in the bottle. Even if he were, it’s questionable that he could. Anger is the fuel that feeds his candidacy. Passions on both sides intensify by the week. Scattered protests at his rallies have escalated into terrifying confrontations. Violence is more commonplace. Standing in the airplane hangar at Trump’s rally here in Ohio on Saturday morning was Tom McMurtry, 60, a community college police officer and Iraq War veteran. He described himself as a former Republican who is now an undecided independent who wanted to hear what Trump had to say. He watched Friday’s melee in Chicago as he was eating dinner. Did he blame Trump for any of this? “He could certainly have done things to calm things down, but a lot of his appeal is that he gets people riled up. He stirs people up,” McMurtry said. “It’s hard to stir people up and then at the last possible instant tell them to stop. It’s a momentum heading toward violence, and last night it hit people moving in the other direction.”

The Case for a Presidential Pardon for Don Siegelman

President Barack Obama has promised one of the most sweeping criminal justice reforms in recent years and has built a strong bipartisan coalition to support it. However, while the Constitution gives him the direct authority to immediately reverse glaring injustices—through the use of the power of pardon and clemency—Obama has been extraordinarily cautious about acting. As the editors of The New York Times observed, “until recently President Obama was the least merciful president of modern times.” Indeed, the only high-profile pardon recipients under Obama have been Thanksgiving Day turkeys. With less than a year left in office, it’s time Obama became bolder with his powers. One case among the thousands now before Obama cries out for consideration. That is the 2006 conviction of Alabama Governor Don E. Siegelman on corruption charges stemming from his acceptance of a $500,000 donation as he sought to pass a state lottery to fund public education. The donation was made by a health care executive, whom Siegelman reappointed to an uncompensated state hospital oversight board. As more than 100 of the nation’s current and former attorneys general have pointed out, this prosecution was extraordinary. If such conduct is corrupt, then there is hardly a senior political figure in the country who could escape prison—including Presidents George W. Bush and Barack Obama, who both gave dozens of diplomatic and other government appointments to individuals who contributed or aggregated six- or seven-figure sums to their own campaigns. In fact, Siegelman’s Republican successor proceeded to appoint one of his major campaign donors to the same hospital oversight board. This case bares all the hallmarks of politically motivated prosecution. After Siegelman’s conviction, a series of newspaper and broadcast exposés established that he had been the victim of a political vendetta orchestrated by Texas-based consultant Karl Rove and a number of senior Alabama Republicans. CBS’s “60 Minutes” got wind of the case and provided coverage on the essentially undisputed political shenanigans behind the case. Newspapers around the country called for Siegelman’s release. Then the story got even stranger. The judge who handled it, and whose bias against Siegelman was apparent to most observers but was hastily covered up by his colleagues in black robes, has since been forced to resign in disgrace. He assaulted his wife in an Atlanta hotel and then lied about it to law-enforcement officials. The victim was, incidentally, both his former mistress and the court officer in the Siegelman case. Notwithstanding his resignation, judicial conference officials are so appalled by the judge’s misconduct that they are considering a recommendation that Congress impeach him anyway, to strip away his benefits. In the meantime, Siegelman has sat in prison since September 2012, convicted of conduct that virtually no one believes is actually a crime. At the end of last year, he spent eight weeks segregated from the prison population, in a special-housing unit in the Louisiana facility where he’s serving his time—for having the audacity to protest his innocence in a radio talk show conducted from the prison. (According to Bureau of Prisons policy, prisoners are not permitted to claim publicly that they’re innocent, even when the evidence clearly establishes that they are.) More:



Gov. Bentley on prison riot: Too few corrections officers outnumbered by inmates

Too few corrections officers outnumbered by too many inmates Friday night at Holman Prison played a key role in leading to a riot at the maximum security facility in Atmore, Gov. Robert Bentley said today. Bentley made his comments following a briefing he received on the riot by state prison Commissioner Jeff Dunn. Bentley said Dunn told him that a combination of what had already been an undermanned staff of corrections officers on duty at Holman was made worst when some officers scheduled for duty called in sick leaving the staff even more undermanned than normal. Bentley said that caused some areas of the prison to be under monitored. It was in such an area where a fight broke out between some inmates. Bentley said when officers became aware of the fight they responded but found themselves dangerously outnumbered. Bentley said Dunn told him a corrections officer along with the prison’s warden were stabbed in an effort to take control of the area. When that effort failed the staff withdrew. “They were outnumbered (staff) and they followed protocol and withdrew and called for help,” said Bentley. Bentley said Dunn was first notified of what was happening at about 11 p.m., Friday. Bentley said Dunn told him that emergency response units were able to restore order and lock the prison down by about 3 a.m. “Commissioner Dunn said the injuries to staff were minor,” said Bentley. “Everything is under control now.” More:

Judge Walker Issues Late Night Order on Coleman Tapes

MONTGOMERY—Despite Baron Coleman’s assurances to Judge Jacob Walker III, that he would not release taped conversations between he and Deputy Attorney General Matt Hart, the judge issued a protective order barring him from disseminating them publicly, then hours later he issued an amended version which included Coleman’s statements to the court in a closed hearing. Coleman told the court he secretly recorded conversations between he and Hart and that he “put two and two together,” and now claims the tapes may show prosecutorial misconduct in the felony case against Speaker Mike Hubbard. Judge Walker’s first protective order was issued at 5:18 pm, March 10, and the amended order came later that evening at 8:40 pm. FIRST PROTECTIVE ORDER  AMENDED PROTECTIVE ORDER

At 5:18 pm Judge Walker issued his first protective order, by 6:59 pm, reported “Coleman was mulling over his legal options including whether to hand the tapes over to Walker in light of the protective order.” An hour and forty minutes later Judge Walker issues an amended order which include statements made by Coleman in a closed hearing: More:

Alabama father who lobbied for tougher child abuse penalties charged with domestic violence

A father who lobbied for tougher penalties for abusers of children was arrested on Friday on two counts of domestic violence. Joey Crampton was charged with two misdemeanor counts of domestic violence third degree and booked into Montgomery City Jail, WSFA reported. Crampton is accused of strangling his wife, Leah, causing her neck to bruise and throwing their 8-month-old child. Leah Crampton claims Joey was smoking marijuana in front of his 4-year-old son Winston, whom Joey Crampton gained custody of in September of last year. Roianne Houlton Conner, an attorney representing Leah Crampton, issued a statement on Saturday. Leah Crampton reported the alleged assault to Montgomery police on Thursday, which led to the arrest of her husband, Conner stated. A restraining order was issued. Subsequently, Autauga County Circuit Court granted Leah Crampton temporary custody of Winston and the couple’s younger children. Winston is at the center of a high-profile child abuse case in Elmore County. His mother, Hallee McLeod, and her boyfriend, Scott Hicks, are accused of severely abusing the boy.

McLeod was indicted on aggravated child abuse and chemical endangerment charges. Hicks is charged with child neglect with serious injury. Winston was found unresponsive and suffering from multiple injuries in the truck of his mother’s boyfriend in Panama City, Fla. in September. Hicks had traveled to Florida to resolve two outstanding warrants, and deputies found the child left in his vehicle. The child had multiple bruises, a laceration on his head and dried blood on his lips. Since that incident, Joey Crampton has lobbied for legislation dubbed Winston’s Law, which created the crime of aggravated child abuse of a child under the age of 6. The offense is Class A felony, which carries a prison sentence of no less than 10 years. The Alabama Legislature passed the bill last month.


My house burned down … and now you shot my dog!

There was no mention of the shooting of the dog. But that didn’t stop the jury on Wednesday from taking just 20 minutes to return a verdict of not guilty for disorderly conduct. One juror even came over to shake the hand of Richard Junkins, the man who for months has complained of the way he was treated by the Madison County Sheriff’s Department on the day he lost everything. On March 6, 2015, a week after a record snowfall, Junkins watched his trailer burn down with his all his possessions inside. His wife, Angie, escaped without shoes. His black lab, named Mr. Bear, also made it out. “He was an inside dog. He never slept outside in his life,” said Junkins. “He was like a son to me. To some people, that may sound funny.” Richard Junkins, 46, stands where his single-wide trailer used to sit on Wall-Triana Highway in northern Madison County. Junkins said he left jail the morning after the fire to find his dog dead on the back porch. Deputies arrived later that evening, about 10 hours after the fire. A driver had called police to say a man was acting strangely, sitting in the roadway. Deputy Daniel De Jong walked down the dark driveway toward the smoldering trailer, flashlight in hand. Junkins could be heard bellowing, making loud anguished sounds. There was barking in the distance. A dog ran out of the darkness and growled.

Deputy De Jong yelled, “Hey, hey!” He shot and killed the dog. Junkins lost his mind. Standing in the bitter cold, half-dressed, with red dots of Taser sights on him, he began cursing the man who just killed his dog, daring deputies to fire again. “Hey, stay where you’re at!” commanded De Jong. “Son of a bitch…you shot my dog!” De Jong repeated: “Get on the ground!” Junkins twice tells him: “Shoot me!”

There is much yelling, some indecipherable, some profane. “Do you understand get on the ground?!?”

“My house burned down today and now you shot my dog!”

Disorderly conduct:  After the yelling, Junkins was taken into custody without force. He was arrested for disorderly conduct for obstructing traffic. On the footage from the body camera, De Jong can be heard explaining: “We’re trying to figure out what’s going on, I get a big-ass dog running at me, I ain’t going to get bit.” But Junkins, now in custody, tells him: “You killed my baby.” None of this would come out during the perplexing trial on Wednesday.

The jury would not see the video. Judge Ruth Ann Hall ruled that lawyers could not discuss the shooting of Mr. Bear. The judge also warned: “There will not be any mention of any other cases involving this officer.” That officer would be Deputy De Jong, who was in the news last year for tasing a man in the back during his housewarming party. More:



Joe: Donald Trump’s Chicago scam

We keep talking to ourselves. Constantly. Trying to make order out of chaos and sense out of the surreal. And this year, most doing the talking have gotten it wrong. Wrong about Trump. Wrong about Rubio. Wrong about Sanders. And now wrong about the road ahead. What are we talking to ourselves about now on the Sunday shows, on cable news, in newspaper columns, in the blogosphere, on Twitter, Snapchat and Facebook? We are grimly warning the world that following Friday night’s fracas in Chicago, America faces a deepening divide that is tearing away at the fabric of this great land. What mind-numbing nonsense. Friday’s freak show was as prepackaged as a rerun of “The Celebrity Apprentice.” The only difference was that Donald Trump delivered his lines on the phone from a hotel room in the Windy City instead of on the set of his made-for-TV boardroom. It was all a scam. Has anyone noticed that Trump’s campaign now regularly stages media events designed to eclipse any negative coverage that predictably follows Republican debates? The Feb. 25 debate in Houston where Marco Rubio delivered the campaign’s most withering critique of Trump was followed the next morning with Chris Christie’s headline-grabbing endorsement. That Friday press conference consumed all political coverage throughout the weekend and limited any fallout from the Fox debate to a hardy band of Trump deniers on Twitter. Then last Thursday, Rubio delivered the debate performance of his life in Miami. But with Florida and Ohio five days away, the Trump campaign took no chances. It leaked the news of Ben Carson’s coming endorsement before the debate even began and held another Friday morning press conference to showcase it. But Carson was just the warm-up act. When news broke early Friday night that the Chicago rally had been canceled because of safety fears, you didn’t need to be a programming genius to predict what would be jamming America’s airwaves for the rest of the night. And for the next four hours, the candidate who is promising to weaken libel laws spoke on cable news channels about how his First Amendment rights were being violated. He was doing all of this while reaching a far larger audience than he could have ever done while actually speaking at a rally. As has been the case throughout the entire 2016 cycle, Trump thrives on the political chaos that he helps creates. If it is true that opportunity and chaos are the same word in Mandarin, Trump should stamp that word on a poster and sell it at his next scheduled event. For the Manhattan billionaire, manufactured chaos is just as profitable for his brand as Paris Hilton’s sex tape was for hers. More:

What is the difference between Trump and Cruz?

 Various commentators are arriving at the conclusion that the final contest for the Republican nomination will be a fight between Donald Trump and Sen. Ted Cruz. Many of those same commentators have suggested it’s a very difficult decision to make, essentially a choice of who is the lesser of two evils. I don’t get that thinking. I said in January that for all his flaws, Cruz (Tex.) is “an authentic conservative Republican with a discernible government point of view.” And, as I said then, “Cruz would be much easier to defend” because at least he has experience, is an able retail politician and has a grasp of American civics — unlike Donald Trump. I thought that in Thursday night’s debate, Cruz was a star. He is credible as a thinking person’s candidate — although my sister said he reminds her a little bit of Frank Burns from “M*A*S*H,” which is not so good. Setting that aside, I think Cruz makes a compelling case for why he should be the Republican nominee. He has a deep understanding of the issues, he has thought about what it might take to actually solve our country’s problems and he legitimately understands the architecture of government. It’s obvious Trump doesn’t know much about policy. During Thursday’s debate, it was painful to watch him pretend he knew anything about the standards set by Common Core. Expectations for him are so low that if he were to express some vague awareness that there are nine Supreme Court justices, 50 states, three branches of government and no such thing as “the button,” a lot of commentators would swoon over his “until now hidden” level of remarkable sophistication. If Trump occasionally refrains from hurling insults, shouting vulgarities or frothing at the mouth — perhaps because he is tired or simply bored — plenty of commentators are eager to conclude he has shed what was simply an act and is certainly capable of acting presidential. I’m not convinced. I have no problem picturing Cruz as president. I have no problem thinking he could conduct himself well with foreign leaders, and even though his friction with other members of Congress has been well-documented, at least he knows how the place works. And, if commentators are so quick to believe that Trump would change his behavior if he became the Republican nominee, then they also have to assume Cruz would begin to act in a manner that would help him be effective as president and win approval for his policy agenda. It’s not over until it’s over. Maybe Sen. Marco Rubio (Fla.) is closing in on Trump in his home state. Maybe Ohio Gov. John Kasich will win in his home state. But even so, there is still a plausible chance that Cruz and Trump will be in the finals. If that happens, Republicans should back Cruz and feel good about it.

A cease and desist letter to the City of Birmingham

So the city of Birmingham sent a cease and desist letter to the people replacing that stupid eyesore of a Pepsi sign that has polluted the city skyline for too long. Good job, Birmingham. Always with its fingers on the pulse of the people. But the city’s action is … inspirational. It inspires me to consult my own lawyers – Dumas, Collum & Neste – to issue, on behalf of the people of this city, a cease and desist letter to the City of Birmingham itself. To the Mayor and City Council of Birmingham:  This order is to inform you that we, THE PEOPLE, have had it up to HERE. If we wanted a mayor and council calling each other names and refusing to share basic supplies we would have elected the second grade class at Washington Elementary School. And we would be far better off. You are ORDERED TO STOP such activities immediately as they are in violation of all that is holy. We are embarrassed to see the MAYOR and COUNCIL MEMBERS fight like overstimulated pre-pubescents in the middle of council meetings, humiliated to know that for every story the world reads in the New York Times about up-and-coming Birmingham, there is another story like that one, proving only that this city is governed like a Banana Republic. And WE THE PEOPLE don’t mean the store at the mall. We demand that you STOP traveling across the country and the world to sell yourselves as important people while failing to bring back even a wisp of worldly wisdom. We order you to STOP spending money on parties and celebrations of your own authority, to END the sad food fight that city meetings have become. They are a time-sucking violation of COMMON DECENCY. MAYOR WILLIAM BELL you must be responsive to a council that needs to know the overall financial condition and strategy of the city. Anything else is just ARROGANT and IRRESPONSIBLE. You are the mayor, and the chief executive, but you are not the KING OF BIRMINGHAM. When you try to pass bills in the Alabama Legislature to steal powers from the city council you behave JUST LIKE THE COUNCIL and you look like the despot they call you. Council President JOHNATHAN AUSTIN, grow up. You cannot in good faith criticize the mayor by calling him OLD. Half the population is older than you. And another 25 percent are TOO YOUNG TO VOTE. And, while WE THE PEOPLE are generally in favor of HYPERBOLE, it would be wise for you to understand the context of history before invoking THE BERLIN WALL or BULL CONNOR in city disputes. It is unseemly for someone in your position. And CITY COUNCIL, please remember your role. You are the legislative branch, so CEASE AND DESIST acting as if it is your job to boss employees around. Legislate, for that is your job. If any of you want to perform mayoral functions then by all means quit your jobs and RUN FOR MAYOR. Until then, act like you appreciate the honor you have been given. But STOP complaining about how hard the job is and STOP giving yourselves perks and pay raises. This order acts as ONE FINAL CHANCE for you to cease your MINDBOGGLING activities before WE THE PEOPLE exercise our rights to KICK YOU BUMS OUT ON THE STREET. STOP embarrassing us. CEASE AND DESIST putting yourselves above the people you were elected to represent. ACT like leaders, and not just SELFISH politicians. With all DUE respect. Sincerely, The People of Birmingham


Morning Money

POLITICAL ANXIETY GRIPS WALL STREET — POLITICO’s Ben White: “Wall Street has been on a wild ride the last few months with big daily swings increasingly the norm. And one major reason is no one can figure out the 2016 election. One day the dreaded Donald Trump is vulnerable. The next he is the all but certain Republican nominee. But then, after all, there may be a brokered convention.

“Some traders and executives wonder if Ted Cruz, currently running second to Trump in pledged delegates, might be scarier than the New York billionaire. They are hoping for a white knight to ride in and save everyone at the GOP convention in July. But if that happened, others respond, there could be riots on the streets of Cleveland. After all, assaults at Trump rallies pop up in the news on a near daily basis.

WILD ON THE LEFT — And it’s not just craziness on the Republican side. The rock-solid Wall Street conventional wisdom that Hillary Clinton has a lock on the Democratic nomination keeps sprouting leaks. Everyone thought Clinton would crush Vermont Senator and self-described Democratic socialist Bernie Sanders in Michigan and bring the race to a quick close. And then she lost. … The result of all these questions on Wall Street is a giant spike in political uncertainty. And there is nothing markets hate more than uncertainty.

“You can clearly correlate some of the increased volatility on Wall Street to developments in the presidential campaign,’ said hedge fund manger Doug Kass of Seabreeze Partners. … The 2016 campaign is not the only thing causing markets to jump all over the map. There is uncertainty over the direction of the U.S. economy, the collapse in oil prices, fear over slower growth in China and the uncertain policy path of the U.S. Federal Reserve and central banks across the globe.

“But the incredibly volatile 2016 campaign — with strong populist fervor surging in both parties — leaves traders, Wall Street executives and major investors completely clueless about who might wind up in the White House in 2017 and what they might have to say and do to get there.”

NO PATH FOR TRUMP IN NOVEMBER SAYS TOP CLINTON STRATEGIST — In the latest “Off Message” Podcast, pollster Joel Benenson tells Glenn Thrush that Donald Trump has no path to victory in November and predicts that states like Arizona and North Carolina could flip in a Clinton/Trump matchup. Benenson also brushes off the theory that Trump can play in Rust Belt states — “He doesn’t have a message that appeals to these folks. It’s not real.” LISTEN to the full conversation for much more on Clinton, Sanders, and Trump and be sure to subscribe to “Off Message” on iTunes.

MARCH MADNESS! — UVA, UNC, Kansas and Oregon are the #1 seeds. Full bracket:

BUFFETT BRACKET CHALLENGE — Yahoo Finance today has a video interview with Warren Buffett, “who opens up to EIC Andy Serwer about his $1 million-a-year-for-life offer to any employee who predicts the Sweet Sixteen round perfectly this year”

DRIVING THE WEEK — Fed announcement and Yellen presser on Wednesday with no rate hike expected. Markets will look for any dot-plot changes and hints about when the next hike might come … Tuesday’s primaries will either put Trump on a glide path to the nomination or make a contested convention a serious possibility … Senate Banking has a nominations hearing Tuesday at 10:00 a.m. … FDIC meets Tuesday at 10:00 a.m. … U.S. Chamber hosts its capital markets summit Wednesday at 8:00 a.m. … ABA holds its government relations summit Wednesday at 8:30 a.m. … House Financial Services holds a CFPB hearing Wednesday at 10:00 a.m. … Retail sales Tuesday at 8:30 a.m. expected to drop 0.1 percent headline and 0.2 percent ex-autos …

BIG WEEK AHEAD ON THE TRAIL — Tuesday’s primaries could decide whether Donald Trump can lock up the GOP nomination before the July convention or if chaos in Cleveland lies ahead. Should Trump take both Florida (99 delegates) and Ohio (66), there is probably no stopping him. But while the marketing executive leads by significant margins in most Florida polls, he trails home state governor John Kasich in Ohio. GOP 2012 nominee Mitt Romney will campaign in Ohio with Kasich on Monday as the “stop Trump” effort enters what could be its final days …

If Trump splits the two big states, establishment dreams of keeping him from the 1,237 delegates he needs will remain viable. If he somehow loses both, Trump could be in real trouble. The other big prizes up for grabs Tuesday include Missouri, Illinois and North Carolina. Trump could take them all but Kasich has a shot in Illinois and Ted Cruz has his best chance in Missouri.

TRUMP’S WEEK OF LIES — POLITICO’s Daniel Lippman, Darren Samuelsohn, and Isaac Arnsdorf: “Trump says he is a truthful man. … But truthful he is not. With the GOP front-runner scooping up delegates in a march toward the Republican nomination, POLITICO subjected a week’s worth of his words to our magazine’s fact-checking process. We chronicled 4.6 hours of stump speeches and press conferences, from a rally in Concord, N.C., on Monday to a rally on Friday in St. Louis.

“The result: more than five dozen statements deemed mischaracterizations, exaggerations, or simply false — the kind of stuff that would have been stripped from one of our stories, or made the whole thing worthy of the spike. It equates to roughly one misstatement every five minutes on average. From warning of the death of Christianity in America to claiming that he is taking no money from donors, the Manhattan billionaire and reality-show celebrity said something far from truthful many times over to the thousands of people packed into his raucous rallies”

BIG WEEK FOR THE FED — Pantheon’s Ian Shepherdson: “A huge wave of data will break over markets this week, along with the FOMC meeting, new dotplots and Chair Yellen’s press conference. … [W]e’re sticking with our view that the Fed will be forced into four rate hikes this year, starting in June. Markets expect only one-and-a-half hikes, so the scope for disruption is huge.”

TRUMP THE OUTSOURCER — WP’s Rosalind S. Helderman and Tom Hamburger: “Donald Trump wanted to market a line of men’s clothes that would bear his name. He told people working with him to help find a company known for producing quality merchandise on a mass scale. In the end, Trump signed on with Phillips-Van Heusen, a manufacturer of affordable shirts produced in factories in 85 countries. …

“Documents and interviews reveal the personal role that Trump played in negotiating the deal. Participants said they could not recall Trump expressing a preference that products be made in the United States. … Today, Donald J. Trump Collection shirts — as well as eyeglasses, perfume, cuff links and suits — are made in Bangladesh, China, Honduras and other low-wage countries. … Trump’s daughter Ivanka, a vice president at his company and frequent campaign surrogate, markets hundreds of additional products under her own line of jewelry and clothing, many of which are made in China”

BLOOMBERG’S WINKLER: LAY OFF THE BANKS — Bloomberg’s Matt Winkler: “There’s a perverse competition among some U.S. presidential candidates: Who can most loudly blame Wall Street for the problems of Main Street. They’ve got it wrong. Financial firms are doing more to help consumers, business and industry in America than they have in decades. And for the first time since the early years of the 21st century, global investors consider U.S. banks among the world’s best. …

“All but ignored in the presidential debates this year is the record $1.06 trillion of loans to commercial and industrial firms by the largest U.S. banks, an amount that has increased for 21 consecutive quarters. That’s a streak unequaled since 1985, when Ronald Reagan occupied the White House (and Bloomberg began compiling such data).”

MUST READ ON DELEGATE MATH — GOP attorney Ben Ginsberg lays out all the possibilities: “The March 15 winner-take-all primaries in Florida and Ohio have been billed as make-or-break for the Republican candidates still holding out hope that they can topple Donald Trump. But those contests are also make-or-break for Trump, and for the Republican Party: They will determine whether there’s chaos or a coronation at the Cleveland convention.”

RATE HIKES STILL COMING — NYT’s Binyamin Appelbaum: “Federal Reserve officials will gather in Washington on Tuesday and Wednesday to debate whether a bumpy start to the year is now in the rearview mirror, clearing the way for higher interest rates. … The Fed is not likely to raise rates this week, but the steady growth of the domestic economy — despite the wobbles of financial markets and the weakness of other developed nations — is strengthening the hand of officials who say that higher rates are necessary to maintain control of price inflation. It seems increasingly clear that the Fed’s plans to spend 2016 gradually raising its benchmark interest rate have been delayed, not derailed.

“The challenge now confronting … Yellen … is forging a consensus among Fed officials about how soon to resume the march begun in December, when the Fed raised rates, by 0.25 percent, for the first time since the financial crisis. Some Fed officials still emphasize caution, arguing there is little risk in moving slowly. … But other officials are antsy about inflation. Prices rose 1.7 percent in the 12 months through the end of January, according to the latest reading from the Fed’s preferred gauge. The modest uptick brings the Fed closer to its goal of 2 percent annual inflation for the first time in years”

CHINA FIRM STRIKES BIG U.S. HOTEL DEAL — FT’s Arash Massoudi and James Fontanella-Khan in New York, and Lucy Hornby in Beijing: “Chinese insurer Anbang has struck its biggest deal for prime US property, agreeing to buy Strategic Hotels & Resorts for $6.5bn only three months after private equity group Blackstone took the luxury hotels collection private. The acquisition is the latest sign of China’s unprecedented march on foreign assets at a time when the world’s second-largest economy grapples with turbulent economic conditions. …

“It also suggests that Anbang, which along with investment conglomerate Fosun International and real estate group Dalian Wanda have spearheaded many of China’s most ambitious deals, is undeterred in its acquisition spree in spite of a political backlash over some dealmaking attempts. Strategic Hotels & Resorts owns 16 luxury US hotels including San Diego’s waterfront Hotel del Coronado and New York’s JW Marriott Essex House Hotel, which sits on the southern side of Central Park”

DEATH TOLL RISES IN TURKEY — Reuters/Ankara: “The death toll in a car bomb attack in the Turkish capital Ankara has risen to 37 people, Health Minister Mehmet Muezzinoglu said on Monday, adding that 71 people were still being treated in hospital. Of those in hospital, 15 were in serious condition, he told reporters. … Sunday’s bombing was the second such attack in the administrative heart of the city in under a month and two senior security officials told Reuters initial findings suggested the Kurdistan Workers Party (PKK) militant group was responsible.”

STOCKS RISE EARLY — Bloomberg: “Stocks rose in Asia and Europe, extending a global rally before central banks in two of the world’s three biggest economies review policy this week. Australia’s dollar led declines among commodity currencies as oil fell. … Chinese equities jumped after the new head of the securities regulator signaled he will maintain state support for shares. Turkey’s lira weakened after a deadly bomb attack in Ankara”

POTUS Events


10:00 am || Receives the Presidential Daily Briefing
11:15 am || Delivers remarks at the State Department to chiefs of missions
12:30 pm || Lunch with Biden
5:30 pm || With Mrs. Obama, hosts the Broadway cast of Hamilton for a performance of musical selections; East Room

All times Eastner
Live stream of White House briefing at 12:45 pm


Floor Action

A package to provide assistance to the city of Flint, Mich., after residents suffered from water contamination and the fate of President Obama’s executive actions on immigration will be the focus of this week in Congress.

Senators are expressing hope that they’ll be able to revive a long-stalled energy bill and deal on aid to Flint, Mich., this week.

But hurdles remain in bringing the bills back onto the Senate floor. Sen. Bill Nelson (D-Fla.) put a hold on the package over concerns about a GOP-push for an amendment to expand an offshore drilling revenue-sharing program.

“They’re trying to start the process of drilling off of Florida,” Nelson told reporters late last week. “For 40 years, I’ve fought to keep rigs off of the state of Florida and I will not let that happen here to satisfy Sen. [Bill] Cassidy.”

Cassidy, a Louisiana Republican, is offering the amendment.

Unless Majority Leader Mitch McConnell (R-Ky.) files cloture on the two bills, supporters will need unanimous consent to bring the measures up on the Senate floor.

Nelson, who is supportive of the energy bill, is one of two senators who have a hold.

Sen. Mike Lee (R-Utah) is also blocking the Flint aid deal, though Sens. Debbie Stabenow (D-Mich.) and Gary Peters (D-Mitch.) expressed optimism that they would quickly be able to find an agreement.


The House will take a step toward inserting itself in the debate over President Obama’s executive actions on immigration before the Supreme Court.

Lawmakers are expected to vote either Wednesday or Thursday on a resolution authorizing the Speaker to file an amicus brief on behalf of the full House in the case before the Supreme Court regarding the legality of President Obama’s 2014 actions to shield up to five million illegal immigrants from deportation.

Democrats filed their own brief last week in support of the executive actions, arguing that any brief that House Republicans submit wouldn’t speak for them.

Twenty-six states are challenging the executive actions, which have been frozen for more than a year after a federal judge put them on hold.

The Supreme Court is expected to hear arguments on the case on April 18 and issue a ruling by the end of June.

However, the Supreme Court is operating with only eight justices after Antonin Scalia died in February. It’s possible the Supreme Court wouldn’t be able to break a tie along party lines, which would result in deferring to the lower court’s decision or another round after Scalia’s replacement is confirmed.


House Republicans are still trying to find a way forward on passing a budget resolution this year.

The Senate Budget Committee announced last week that it will postpone consideration of a budget amid the divisions in the House. And Senate Majority Leader Mitch McConnell (R-Ky.) maintained that the upper chamber will adhere to the spending limits outlined in last year’s budget deal despite resistance from House conservatives.

GOP members of the House Budget Committee are expected to meet Monday evening to discuss their options. If they can reach an agreement, the panel could consider a budget resolution as soon as Wednesday to send it to the House floor for a vote next week.

In the meantime, the House Ways and Means Committee plans to mark up a “budget savings” package this week that it says will reduce the deficit by $16 billion in two years by targeting overpayments in government programs like the healthcare law.

Education secretary

The Senate will take up President Obama’s nominee to lead the Department of Education.

Majority Leader Mitch McConnell scheduled a vote for Monday evening on John King’s nomination to be Education secretary.

King has been the department’s acting secretary since Arne Duncan stepped down last year.

The White House initially indicated it wouldn’t formally nominate King to avoid an election-year fight, but Sen. Lamar Alexander (R-Tenn.)—who chairs the Health, Education, Labor and Pensions Committee—said he promised to give the president’s nominee a “fair” hearing.

The HELP Committee approved King in a 16-6 vote late week, with Alexander voting in favor of his nomination. But he still faces opposition from lawmakers in both parties this week.

Sen. James Lankford (R-Okla.), who had a hold on his nomination, will likely vote against Obama’s pick during Monday’s vote, according to his office.

Meanwhile, Sen. Elizabeth Warren (D-Mass.) suggested she would vote against him unless she received “more direct answers” on how he would bolster protections for students who borrow money to pay for college.


The Senate could also wade into a fight over legislation to block states from issuing their own mandatory labeling laws on genetically modified foods (GMOs).

Senators could take up the legislation this week, after it passed earlier this month out of the Agriculture, Nutrition and Forestry Committee.

The legislation—from Sen. Pat Roberts (R-Kansas)—would also establish a voluntary federal standard.

Senate Democrats also introduced their own rival bill earlier this month that would require manufacturers to disclose if a product includes GMOs.

Meanwhile, the House passed its own bill last year despite fierce pushback from consumer groups and Democrats.

No vote or floor time for Roberts’ legislation has been scheduled, but Republicans will need the support of at least six Democrats to get it passed.


What You Need to Know About the Child and Dependent Care Tax Credit

Don’t overlook the Child and Dependent Care Tax Credit. It can reduce the taxes you pay. Here are 10 facts from the IRS about this important tax credit:

  1. Child, Dependent or Spouse. You may be able to claim the credit if you paid someone to care for your child, dependent or spouse last year.
  2. Work-Related Expense. The care must have been necessary so you could work or look for work. If you are married, the care also must have been necessary so your spouse could work or look for work. This rule does not apply if your spouse was disabled or a full-time student.
  3. Qualifying Person. The care must have been for “qualifying persons.” A qualifying person can be your child under age 13. A qualifying person can also be your spouse or dependent who lived with you for more than half the year and is physically or mentally incapable of self-care.
  4. Earned Income. You must have earned income for the year, such as wages from a job. If you are married and file a joint tax return, your spouse must also have earned income. Special rules apply to a spouse who is a student or disabled.
  5. Credit Percentage / Expense Limits. The credit is worth between 20 and 35 percent of your allowable expenses. The percentage depends on the amount of your income. Your allowable expenses are limited to $3,000 if you paid for the care of one qualifying person. The limit is $6,000 if you paid for the care of two or more.
  6. Dependent Care Benefits. If your employer gives you dependent care benefits, special rules apply. For more on these rules see Form 2441, Child and Dependent Care Expenses.
  7. Qualifying Person’s SSN. You must include the Social Security number of each qualifying person to claim the credit.
  8. Care Provider Information. You must include the name, address and taxpayer identification number of your care provider on your tax return.
  9. Form 2441. You file Form 2441 with your tax return to claim the credit.
  10. IRS Free File. You can use IRS Free File to prepare and e-file your federal tax return, including Form 2441, Child and Dependent Care Expenses, for free. Free File is the fastest and easiest way to file your tax return and it’s only available at

Each and every taxpayer has a set of fundamental rights they should be aware of when dealing with the IRS. These are your Taxpayer Bill of Rights. Explore your rights and our obligations to protect them on

Krebs Daily Briefing 10 March 2016

Thomas L. Krebs, Securities Litigation, Regulation and Compliance Attorney Lawyer (c)2014 Brandon L. Blankenship
Thomas L. Krebs


ISIS Detainee Tells U.S. of Militants’ Plan to Use Mustard Gas

WASHINGTON — An Islamic State detainee currently in American custody at a temporary detention facility in Erbil, Iraq, is a specialist in chemical weapons whom American military officials are questioning about the militant Sunni group’s plans to use the banned substances in Iraq and Syria, Defense officials said. Defense officials said the detainee, described by the military as a “significant” Islamic State operative who was captured a month ago by commandos in an elite American Special Operations force, has, under interrogation, provided his captors with details about how the group had weaponized mustard gas into powdered form and loaded it into artillery shells. One Defense official said that it was not concentrated enough to kill anyone, but that it could maim people. As is protocol, Defense Department officials notified the International Committee of the Red Cross, which monitors the treatment of detainees, that they were holding an Islamic State fighter. The Red Cross acknowledged in a statement on Tuesday that it had visited the detainee but gave no other information. Defense Department officials insist that the United States has no plans to hold the detainee or any other captives indefinitely, and that they will be handed over to the Iraqi and Kurdish authorities after they have been interviewed. The officials say they do not intend to establish a long-term American facility to hold Islamic State detainees, and Obama administration officials have ruled out sending any to the United States military prison at Guantánamo Bay, Cuba. The chemical weapons specialist was captured last month, shortly after the arrival in Iraq of a new Special Operations force that is made up primarily of Delta Force commandos. They are the first major American combat force on the ground there since the United States pulled out of the country at the end of 2011. Before this, the American military has largely fought the Islamic State, also known as ISIS or ISIL, with airstrikes, killing large numbers of Islamic State fighters in Iraq and Syria. But the 200-member Special Operations team has been given the task of killing and capturing Islamic State operatives, the latter in particular to use in gathering intelligence.

Syrian Opposition Signals Support for Peace Talks

A spokesman for Syria’s leading opposition group says his organization is likely to attend U.N.-brokered peace talks on Monday after walking away from earlier negotiations, building momentum behind the most promising, albeit distant, diplomatic push in years to end the civil war. “Talks will start on Monday in Geneva,” High Negotiations Committee spokesman Salim al-Muslat told Foreign Policy in an interview Wednesday. “It will be indirect talks with two separate rooms. We have no problem with that.” Muslat said he could not officially confirm the HNC’s attendance until it completes an internal assessment on the ceasefire that took effect on Feb. 27. But he expressed optimism that discussions were moving in the right direction. “We are optimistic, but we’re still waiting for a decision from all the members of HNC. We’re not against attending negotiations,” he added. The long-stalled resumption of peace talks has been expected since the U.S.-Russia-brokered ceasefire that has sharply reduced the country’s violence. Though limited in its scope — it does not preclude strikes against the Islamic State or the al Qaeda-affiliated al Nusra Front — the truce has largely held despite sporadic violence in different parts of the country, including most recently in Idlib. The Syrian Observatory for Human Rights, a U.K.-based monitoring group, said 80 civilians died in ceasefire zones since the agreement took effect. In a Wednesday news conference, the U.N.’s special envoy to Syria, Staffan de Mistura, cautiously welcomed the “sustained reduction of violence.” “Incidents are taking place, no question … I’m expecting even worse incidents to take place, probably caused by spoilers,” he said. Still, de Mistura said he expects “substantive, deeper” talks between President Bashar al-Assad’s government and opposition leaders to start Monday, continuing 10 days before a seven-day break. The agenda includes the formation of a transitional government, a new constitution, and holding fresh elections. “At the end of the day, a ceasefire and cessation of hostilities are not the solution,” he said. The solution is a political transition.”

U.S. serves up Korean rocket salad in war drill response to North’s nuclear threats

There’s more to do in South Korea’s heavily forested Rocket Valley, just a few miles from the demilitarized zone separating the two Koreas, than fire rockets. In quieter times, people tend vegetable patches along ice-cold streams. But on Wednesday, a U.S. artillery brigade based in the South heated things up, launching a barrage of rockets close to the border town of Cheorwon. The live-fire drills came hours after a report by reclusive North Korea that it had miniaturized nuclear warheads to be mounted on ballistic missiles and leader Kim Jong Un had ordered further improvements to its arsenal. Tension in the region was already high as South Korean and U.S. troops began large-scale military exercises on Monday in a test of their defenses against North Korea, which called the drills “nuclear war moves” and threatened to respond with an all-out offensive. The U.N. Security Council imposed harsh new sanctions on North Korea last week for its Jan. 6 nuclear test. The North launched a long-range rocket a month later, drawing international criticism and sanctions from South Korea. The drills in Rocket Valley were separate to the annual joint U.S.-South Korean maneuvers which involve about 17,000 U.S. troops and more than 300,000 South Koreans. They were a test of the U.S. Army M270A1 system, a multiple-launch rocket system (MLRS) built by Lockheed Martin that can fire 12 rounds and re-load and move at 64 km (40 miles) per hour. One unit was dug in at the foot of Rocket Valley, under the swaying firs. A sonic boom followed the rockets as they screamed over the tree line followed by trails of flame toward targets eight km (five miles) away, invisible over the ridge lines. “If North Korea decides to use their long-range artillery, which they have so many pieces of, Seoul would be in direct range,” Captain Harry Lu of the U.S. Army’s 37th Field Artillery Regiment said. “So our mission here is to make sure we destroy that artillery before they can cause any more damage to the greater Seoul metropolitan area.”

Kill or Capture: Washington’s New ISIS Plan Claims Two

The recent killing of an Islamic State leader in Syria and the capture of another by American forces in Iraq mark the first steps forward in a long-discussed shift to defeat the extremist group: the targeting of specific terrorist leaders instead of exclusively striking assets and training local troops. On Wednesday, Iraqi security officials identified a recently detained Islamic State leader as Sleiman Daoud al-Afari, who was captured by the U.S. Army’s Delta Force in northern Iraq several weeks ago. He is currently being held in a temporary U.S. detention facility in the northern Iraqi city of Erbil and will eventually be turned over to Iraqi or Kurdish authorities. Afari is a chemical weapons expert who once worked for Saddam Hussein’s regime. It is not known if he ran the Islamic State’s chemical warfare program. The Islamic State has attacked Kurdish forces with chemical weapons repeatedly in recent months, according to Director of National Intelligence James Clapper. Last month, Clapper told a congressional panel that the Islamic State has “used toxic chemicals in Iraq and Syria, including the blister agent sulfur mustard.” He said it was the first time a terrorist group had used chemical weapons in an attack since the extremist Aum Shinrikyo group used sarin in the Tokyo subway system in 1995. (Syrian President Bashar al-Assad also has been accused of unleashing sarin against his people, including a deadly 2013 attack that brought a reluctant White House to the brink of launching massive airstrikes against the regime.) Kurdish forces repeatedly have asked Washington for gas masks as protection from chemical-laced artillery shells fired at their troops. Several thousand have arrived. It is unknown how long Afari will be held by U.S. forces. But broadly, Pentagon officials hope to glean intelligence from detainees to use in planning raids against the Islamic State’s secretive leadership structure. That is the same model once used by the Joint Special Operations Command in Iraq and Afghanistan, which tore through al Qaeda’s leadership hierarchy in a wave of night raids that scooped up high-level detainees. The Delta Force team that captured Afari is part of an “expeditionary targeting force” of about 200 troops sent to Iraq late last year, tasked specifically with killing or capturing Islamic State leaders. More:

Arab Billionaire Who Dumped Trump: U.S. Election Isn’t Reality TV

A self-made Arab billionaire who made headlines worldwide when he publicly withdrew his support for Donald Trump has again waded into the presidential race by calling on American voters to reject the “cult of personality.” Khalaf Al Habtoor, who has featured on the Forbes rich list, said Wednesday he was afraid a segment of the American public was “falling under the sway of inappropriate candidates with extreme positions and vulgar turns of phrase.” “I have always naively believed that presidential candidates were thoroughly screened in terms of background, family ties, colleagues and friends. It appears they are not,” the billionaire wrote in “An Open Letter to Our American Friends” that is due to appear in Middle Eastern newspapers later this week. Al Habtoor added that he was a great admirer of the U.S. He wrote: “All I can do is appeal to you, the voters, to sit quietly, take a deep breath and ponder on all the pros and cons of each candidate. Do not get caught up in hysteria or in the cult of personality. Your country is worth more. Forget such labels as Democrat and Republican.” Al Habtoor is the chairman of United Arab Emirates-based conglomerate Al Habtoor Group, which built Dubai’s airport and owns Aston Martin and Bentley dealerships and luxury hotels throughout the region. He did not refer to Trump by name in the letter obtained by NBC News on Wednesday. But on Dec. 8, Al Habtoor told NBC News that he regretted supporting Trump, whom he had previously endorsed, after the real-estate mogul called for “a total and complete shutdown” on Muslims entering the U.S. “GOP debates are devolved into entertaining slanging matches with rivals launching personal attacks on one another to grab the media spotlight,” he said, claiming that none of the Republican candidates had the “dignity or gravitas” to be commander-in-chief. “This is not a game or a television series. You, the good people of America, hold not only your future but the future of the world in your hands,” Al Habtoor said. He went on to support Hillary Clinton for president, saying the onetime first lady had a “tried and true” record despite “mistakes” involving a private network server she used while secretary of state. “Clinton does carry certain baggage on her shoulders,” Al Habtoor added. “At least she comes with diplomatic experience and a record of holding high office … As they say, better the devil you know than the devil you don’t!”

Europe’s Baller Bank Notes Are Fueling Terrorism

This year, the European Commission opened a new front in the fight against terrorism. Not, as one might expect, on a battlefield or in a particular military hub, but inside the otherwise dour world of central-bank printing presses.Over the next couple of months, the EU executive body will investigate whether the 500-euro bill, the largest denomination in circulation inside the eurozone, is being used by terrorists in the Middle East to transfer and store wealth. “These notes are in high demand among criminal elements,” the commission reported in February, “due to their high value and low volume.” So what happens if the commission finds a strong terrorist link? The European Central Bank may stop printing those big bills—and eventually even stop honoring them too. As the threats posed by the Islamic State and other terrorist groups have swelled over recent years, Western security officials have scrambled to find ways to undermine these organizations’ logistical operations. One tactic has been to step up bank regulations in order to stop terrorists from moving money via electronic-payment systems. So far, so sensible. But the problem is that this approach covers only half (if that) of the terrorist money machine. These days, a significant part of the financial flows supporting terrorism is taking place not within 21st-century cyberfinance, but via the old-fashioned medium of cash, particularly high-denomination notes. Indeed, precisely because of the clampdown on cyberpayments and regulated banks, the importance of paper money may now be rising. Banning large bank notes, as the European Commission is contemplating, might undermine those flows. Consider it, if you like, as the financial equivalent of throwing sand in the wheels of the transfers: A ban might not stop all the illicit ways in which money is moved around, but it will make the attempts logistically harder. And when it comes to tangible cash, physical details matter. For instance, to carry the equivalent of $1 million in 500-euro notes, you need only a small carrier bag, according to a 2016 Harvard University study overseen by Standard Chartered’s former head, Peter Sands. To convert that same amount into $100 bills, it takes a simple briefcase, something not terribly difficult to slip into a plane, train, or car. It’s an entirely different beast in the case of packing $1 million in $20 bills: That calls for four briefcases, which aren’t easily carried by hand.


Growth of Financial Tech Industry Requires Unified Regulation

America’s financial technology industry has exploded in recent years, but regulators have not kept pace. This is partly because of the country’s outdated patchwork of state rules. Britain and other countries are further ahead in addressing this emerging sector in a fresh way. Creating a modern, federal agency to oversee these companies is a priority for United States policy makers. Many of the new “fintech” firms fall under the categories of money transmitters or consumer lenders, businesses that require licenses from nearly 50 states. Each state has different standards, not to mention regulatory examiners with varying degrees of sophistication. That means the 165-year-old Western Union is regulated the same way that a Bitcoin-based transfer start-up with fewer than 50 employees might be. For freshly minted companies, state compliance can be prohibitive, costing more than $1 million annually. Marketplace lenders that provide direct loans are also under state jurisdiction. Take SoFi, a San Francisco start-up, which makes loans. The company, which is led by Mike Cagney, a former Wells Fargo banker, and has raised $1 billion, has 18 state licenses for consumer lending and nearly 20 more for mortgages. The Consumer Financial Protection Bureau, which was established after the 2008 financial crisis, is the federal watchdog looking out for fintech customers, a critical role in a landscape where algorithms have replaced credit scores to determine borrowing. But the agency’s mandate is limited and does not address risks to the broader financial system. The industry is not large enough to raise those concerns, but it could in the future. Yet it is not yet clear who at the federal level has jurisdiction. Regulators need to figure this out fast, and account for the different business models many of these companies have from traditional banks. More:

Will Congress Save You From the Airline Fees?

Outraged by the $200 fee the airline charged you to change your ticket, or the $100 for that second suitcase to Europe? Two senators are out to stanch the avalanche of fees with the Forbidding Airlines from Imposing Ridiculous Fees Act. The bill, nicknamed FAIR, would ban “fees that are not reasonable and proportional to the costs incurred.” It was introduced Wednesday by Edward Markey, D-Mass., and Richard Blumenthal, D-Conn., members of the Senate Commerce, Science and Transportation Committee. “Airlines should not be allowed to overcharge captive passengers just because they need to change their flight or have to check a couple of bags,” Markey said in a statement. “There is no justification for charging consumers a $200 fee to resell a $150 ticket that was cancelled well in advance.” The senators plan to attach their bill to legislation in the Senate reauthorizing the Federal Aviation Administration, Markey spokeswoman Giselle Barry said. The bill’s chances aren’t great. Congress hasn’t been involved in airline pricing since it deregulated the industry, in 1978. “Most companies, whether it be an auto maker, an oil company, or an airline, they don’t welcome regulation,” Barry said. The bill will help to start “an important debate on who’s on the side of consumers and who’s on the side of the airlines,” she said. Airlines for America, the industry’s trade group, called the legislation “nothing more than an effort to re-regulate an industry that was deregulated to the consumer benefit,” making flying “affordable and accessible,” and said the fares “help to reduce passenger ‘no-shows’ and the need for airlines to overbook.” Separately, the trade group said Wednesday that it expects a 3 percent jump in spring travel on U.S. carriers, to a record 140 million passengers this month and next, from last year, or 63,000 more passengers a day. Delta Air Lines, which quit the group last year, didn’t immediately return emails and a call seeking comment. More:


Everything You’ve Ever Wanted to Know About Voter ID Laws

Voter ID laws are a contentious issue in the 2016 presidential election cycle. Many of the statutes will have their first test at the polls this year. Supporters say the laws — which 36 states have now enacted in some form — are needed to combat voter fraud, while critics see them as a tactic to disenfranchise voters. We’ve taken a step back to look at the facts behind the laws and break down the issues at the heart of the debate.


Republicans sue State Department for Clinton emails

 The Republican National Committee filed a lawsuit on Wednesday to obtain the records of Democratic presidential candidate Hillary Clinton during and after her tenure as top U.S. diplomat.

The lawsuit, filed under the Freedom of Information Act, said the information sought “bears directly on her qualifications for president.” It seeks disclosure of records exchanged between a dozen State Department officials and people using e-mail accounts from designated domain names affiliated with Clinton, including and


Trump’s VIPs Get Front-Row Seats to His Political Spectacle

 At almost 10 o’clock on Saturday night in the ornate dining room of Trump International Golf Course in West Palm Beach, the oak tables had been removed and replaced with rows of chairs facing a freshly painted gold-and-white podium that the club’s namesake would soon stand behind. But where was Donald Trump? The press conference was scheduled to start an hour ago. While the reporters watched returns come in from Kentucky and posted pictures on Twitter, most of the crowd was getting antsy. “When’s Donald coming out? When he’s good and ready,” said Ken Beer, a West Palm Beach dermatologist, reassuring friends and defending his candidate. Beer, along with most of the others in attendance, is a dues-paying member at one of a trio of lavish clubs Trump owns in Palm Beach County. As has become Trump’s habit in South Florida, he invited club members to the news conference, and seated them in the first few rows. For all the huge rallies and talk of angry outsiders, this small, expensively dressed group is Trump’s real base. There are CEOs, insurance brokers, health-care executives, former debutantes, trophy wives, and a woman in a short, sparkling silver dress (and thick bracelet to match) with an animal fur wrapped around her like a sash. There’s Ike Perlmutter, the Marvel Comics boss who gave $2 million to Marco Rubio’s presidential cause many months ago; Tova Leidesdorf, a former Miss Israel; and, another guest informs me, Patrick Swayze’s widow is in the room, too. “I was supposed to go to New York Prime,” said Lisa Hersch, the owner of a home health agency. “But we got invited here tonight. And I said, you know, why not come out and show our support, because he’s getting beat up.” Hersch, in a bright pink, low-cut dress with three-quarter sleeves, accessorized with a jewel-encrusted gold necklace, said she wanted to look vibrant for the occasion. “It’s very Palm Beach,” she said of her outfit, adding that it was part of a shopping spree the day before, just ahead of her 51st birthday. “I bought myself three bathing suits, three dresses, a massage, lunch at the Yacht Club. It was a great day. It was a girls’ day.” Anjani Sinha, an orthopedic surgeon from Wellington, offered to make introductions to others in the crowd, which earlier was sipping champagne and cocktails at an open bar on the back patio, but transitioned to Trump-brand water and “Trump chocolates,” which look like gold coins imprinted with the Trump family seal. “Who do you want to interview?” he asked me. “I know everybody here. Boy, there are a lot of famous people. A lot of billionaires here.” More:

Senators square off over Supreme Court vacancy

Senators traded sharp words Wednesday over the Supreme Court vacancy standoff as the Senate Judiciary Committee held its first meeting since Justice Antonin Scalia’s death last month. The panel’s ranking Democrat, Sen. Patrick Leahy of Vermont, lit into Republicans for vowing to refuse to hold a hearing on any nominee President Barack Obama offers for the slot, despite the fact that the president has yet to announce his choice for the job. “The Senate’s consideration of the next Supreme Court nominee should not be a question of politics or electoral math. It should be about the solemn oath we all took as senators to uphold the Constitution,” Leahy said at the outset of the hearing. “That is why the American people should expect to see this committee convening this spring to hold public hearings to consider the next nominee to the nation’s highest court.” Leahy also complained that GOP senators met privately and without their Democratic colleagues to craft an unusual letter in which they unanimously pledged not to hold any hearings on a Supreme Court nominee before a new president is sworn in next year. “The Republican members met behind closed doors to unilaterally decide, without any input from this committee, that this committee and the Senate as a whole will refuse to consider any nominee this year,” Leahy said. “It’s a dereliction of our Constitutional duty.” Senate Judiciary Committee Chairman Chuck Grassley replied the GOP members’ action was well within Constitutional norms. “It isn’t any different than if the president of the United States notifies Congress well in advance of passing a piece of legislation that he’s going to veto it,” Grassley said. “It’s up to the Senate to decide how we do our job with regard to ‘advise and consent.'” Grassley also said there’s nothing nefarious about party caucuses. “That was a caucus of Republican members of this committee that we have very frequently. I assume the Democratic members have their caucus to talk about things,” the chairman said. “I’ve never been invited to a Democratic caucus and I don’t think that Democratic caucus is open to the public.” Perhaps bracing for a partisan showdown, nearly all the GOP members of the panel turned up as the hearing kicked off, but as the questioning moved on to other topics several of them filed out. Wednesday’s hearing was a regular oversight hearing for the Department of Justice, featuring Attorney General Loretta Lynch. In an apparent effort to avoid being caught in the senators’ crossfire over the Supreme Court, Lynch announced Tuesday night that she had asked not to be considered for the vacancy. “I love this job, I am so fulfilled by what I am doing,” Lynch said during an appearance at a Women in the World event in Washington on Tuesday. ” There’s so much that I want to push through and cross that goal line before the end of this administration. I’m committed to staying in the Attorney General position and doing that job to the best of my ability.” Grassley said he expected a more prolonged debate on the issue as the committee takes up pending judicial nominations for lower courts at a meeting set for Thursday.


Slavery Reparations Could Cost Up to $14 Trillion, According to New Calculation

 In 1865, toward the end of the Civil War, Union Army General William Tecumseh Sherman promised slaves that they’d receive 40 acres and a mule. Land was even set aside, but the promise was recanted by President Andrew Johnson. Ever since, the issue of reparations has come up many times, often fiercely debated. Although most Americans generally don’t support reparations, according to University of Connecticut researcher Thomas Craemer, it matters greatly how the question is worded, who would get reparations and in what form. For example, the idea of reparations paid in educational benefits are more popular than others, Craemer says. On the other hand, one of the cases often made against reparations is that it’d be impractically difficult to calculate how to fairly take and give so many years after the fact. But in a new paper, published in the journal Social Science Quarterly, Craemer makes the case that there are other examples of historical reparations paid many decades later after “damages” were incurred. He also has come up with what he says is the most economically sound estimate to date of what reparations could cost: between $5.9 trillion and $14.2 trillion. Craemer came up with those figures by tabulating how many hours all slaves—men, women and children—worked in the United States from when the country was officially established in 1776 until 1865, when slavery was officially abolished. He multiplied the amount of time they worked by average wage prices at the time, and then a compounding interest rate of 3 percent per year (more than making up for inflation). There is a range because the amount of time worked isn’t a hard figure. Previous estimates of reparations have ranged from around $36 billion to $10 trillion (in 2009 dollars), Craemer says. Those calculations mostly looked at wealth created by slaves as opposed to services provided, resulting in underestimates. Craemer believes that “the economic assumptions underlying [his method] are more sound” than those used in previous papers. The paper also illustrates several historical examples in which reparations were paid, many decades later, despite being initially unpopular—showing that repayment of age-old claims is not without precedent. More:

GOP superlawyer on contested convention rule: ‘In fact, that’s not a rule’

A Republican presidential candidate doesn’t have to accrue a majority of delegates in eight states to be considered for the nomination during a contested convention in July, former Republican National Committee lawyer Ben Ginsberg — the party’s preeminent election law expert — said Wednesday. “In fact, that’s not a rule,” Ginsberg told MSNBC early Wednesday morning. “That’s part of what’s called the temporary rules. Each convention has to pass for itself the number of states that put a candidate’s name in nomination.” In 2012, revisions to Rule 40 raised the required number of states from five to eight, but no number is in effect for the Cleveland convention, according to Ginsberg. “The 2016 convention and its rules committee has to make that decision,” he said. “So there is no eight-state rule in effect right now for the next convention.” “The 2016 convention can make that number one, eight, 18, 28 or 58, if it wishes,” he added. Ginsberg also delved into the political optics of what happens if Trump goes into the convention either with or without the 1,237 delegates required to form a majority. “Trump’s contest is with himself to be able to amass enough delegates to come to Cleveland with a majority,” he said. “If Trump has a majority, it is done. He will be the nominee.” But if Trump comes up short, Ginsberg said, “It depends on how short he is.” “Someone who goes in with 43 percent of the delegates will be barely over 1,000 — more than 200 delegates short,” Ginsberg said. “That’s a historically weak candidate going into the convention. If he’s 50 short, then that’s pretty tough to take away.”

U.S. women push back against stigma, cost of menstruation

Sixteen-year-old Emma Joy and her younger sister Quinn recently spent an evening stuffing bags with a full year’s supply of tampons or sanitary pads for women who often miss work or school because they cannot afford menstrual products. The South Orange, New Jersey, residents got the idea for their charity, Girls Helping Girls Period, when Emma learned that federal assistance programs for the indigent do not cover menstruation products, leaving many low-income and homeless women to cope with their cycles on their own. “We found out a lot of people don’t know that,” Emma said. “That’s the point: to educate the public and to eliminate this issue of being afraid to talk about it. It shouldn’t be a thing we hide.” The project,, is part of a growing national movement to address the inequities that have sprung up as a result of the stigma that still surrounds menstruation. Some prisons, for example, force female inmates to buy pads at the commissary, and public restrooms rarely provide them free of charge for emergencies. New York and 39 other states impose sales taxes on tampons and sanitary napkins, while exempting the Rogaine hair regrowth treatment, condoms and other products mostly used by men. Advocates have sued in New York, citing a double standard. Women’s advocates say budgets for homeless shelters, schools, prisons and public restrooms should provide free tampons and sanitary napkins, just as they do for soap, toilet paper and other essentials. In a country where erectile dysfunction ads fill television commercial slots and jokes about flatulence and bowel movements have inspired entire books, the bodily function of menstruation endures as a taboo subject. “It goes all the way back to Eve, to religion, misogyny, all the societal norms we’ve been brought up with,” said Maplewood, New Jersey, lawyer Jennifer Weiss-Wolf, who advocates for equitable menstrual policy in the United States. The shame and embarrassment that many women still feel is reflected in the proliferation of euphemisms for menstruation around the world. “Shark week,” “the curse,” “a visit from Aunt Flo” and “having the painters in” are a few of the 5,000 names documented in a 2015 survey of 90,000 people in 190 countries that was carried out by German healthcare company Clue. “We are trained not to talk about it,” Weiss-Wolf said. “When we don’t talk about it, we don’t consider it. We don’t think, ‘Hey, for poor people, this is actually expensive; this can be a problem.'”  More:

Hell and High Water

It is not if, but when Houston’s perfect storm will hit. They called Ike “the monster hurricane.” Hundreds of miles wide. Winds at more than 100 mph. And — deadliest of all — the power to push a massive wall of water into the upper Texas coast, killing thousands and shutting down a major international port and industrial hub. That was what scientists, public officials, economists and weather forecasters thought they were dealing with on Sept. 11, 2008, as Hurricane Ike barreled toward Houston, the fourth-largest city in the United States and home to its largest refining and petrochemical complex. And so at 8:19 p.m., the National Weather Service issued an unusually dire warning. “ALL NEIGHBORHOODS, AND POSSIBLY ENTIRE COASTAL COMMUNITIES, WILL BE INUNDATED,” the alert read. “PERSONS NOT HEEDING EVACUATION ORDERS IN SINGLE FAMILY ONE OR TWO STORY HOMES WILL FACE CERTAIN DEATH.” But in the wee hours of Sept. 13, just 50 miles offshore, Ike shifted course. The wall of water the storm was projected to push into the Houston area was far smaller than predicted — though still large enough to cause $30 billion in damage and kill at least 74 people in Texas. Ike remains the nation’s third-costliest hurricane after Katrina and Superstorm Sandy. Still, scientists say, Houston’s perfect storm is coming — and it’s not a matter of if but when. The city has dodged it for decades, but the likelihood it will happen in any given year is nothing to scoff at; it’s much higher than your chance of dying in a car crash or in a firearm assault, and 2,400 times as high as your chance of being struck by lightning. If a storm hits the region in the right spot, “it’s going to kill America’s economy,” saidPete Olson, a Republican congressman from Sugar Land, a Houston suburb. Such a storm would devastate the Houston Ship Channel, shuttering one of the world’s busiest shipping lanes. Flanked by 10 major refineries — including the nation’s largest — and dozens of chemical manufacturing plants, the Ship Channel is a crucial transportation route for crude oil and other key products, such as plastics and pesticides. A shutdown could lead to a spike in gasoline prices and many consumer goods — everything from car tires to cell phone parts to prescription pills. “It would affect supply chains across the U.S., it would probably affect factories and plants in every major metropolitan area in the U.S.,” said Patrick Jankowski, vice president for research at the Greater Houston Partnership, Houston’s chamber of commerce. Houston’s perfect storm would virtually wipe out the Clear Lake area, home to some of the fastest-growing communities in the United States and to the Johnson Space Center, the headquarters for NASA’s human spaceflight operation. Hundreds of thousands of homes and businesses there would be severely flooded.

The Devastating Truth Behind Marcia Clark’s Leaked Topless Photos

After some astonishing courtroom antics, incriminating L.A.P.D. testimony, and the mother of all perms, this week’s episode of The People v. O.J. Simpson ends in devastation after a topless photo of Sarah Paulson’s Marcia Clark is printed in The National Enquirer. Clark, publicly humiliated once more, dissolves into tears in the courtroom. It was a sharply-observed examination of sexism that happened to air on International Women’s Day. So did this all really happen to Clark? It all did and, in fact, it was even worse. Speaking about the media circus at the time of the trial, Clark told Voguelast January, “There was no privacy. I was famous in a way that was kind of terrifying. I had no protection. When reporters showed up at my house, there wasn’t even a sidewalk. They were literally parked on my front lawn.” And in February she appeared on The View to say that watching American Crime Story was like “reliving a nightmare.” She called it a “painful experience” and said every bit was “awful and hard for me.” But, surely, the hardest part had to come tonight as Clark was forced to relive the moment when her private photos were splashed across the pages of the National Enquirer. In FX’s fictionalized version of events, Clark says that it must have been her ex-husband, Gabriel Horowitz, who sold her photos. In truth, it was her ex-mother-in-law, Clara Horowitz, who sold her out to The National Enquirer. Woman on woman betrayal is always worse. The photo was taken in 1979 and showed Clark topless on a St. Tropez beach with then-husband Horowitz. In the print edition, her breasts were censored with a black bar. Though Simpson’s lawyers weren’t directly responsible for the damaging photos, the so-called Dream Team was allegedly the inspiration. Clark wrote in in her 1997 memoir Without A Doubt: In my mind’s eye, I could see Gaby and me and our Italian train-conductor friend. We were playful and giddy. I’d shed my top. It was so innocent. . . . I later learned that a private eye, hoping to curry favor with the Dream Team, had tracked her down in Israel and put her in touch with the Enquirer. And, just as it played out in The People v. O.J. Simpson, Judge Lance Ito did dismiss the court that day. As Clark tells it, “I overestimated my own strength. No sooner had I taken my seat at the counsel table . . . I felt the tears welling up in my eyes. . . . Lance must have caught my distress, because, in a singular act of compassion, he quickly managed to recess court for the day.” And even though the jury allegedly never saw the photos—they were sequestered thanks to some brutal fake photos of a battered Nicole Brown Simpson that had also been printed in The National Enquirer—the damage to Clark’s reputation was done. The FX show reverses the timeline to show Clark having to publicly defend herself as a motherbefore the Enquirer spread. In fact, the photos ran in early February and Clark’s battle with her estranged husband Gordon didn’t hit headlines until March.

Fate of lawsuit brought by Trump model to be decided this month

A judge will decide by the end of this month whether to proceed with a proposed class action lawsuit filed by a Jamaican fashion model against Republican presidential front-runner Donald Trump’s modeling agency, the judge’s office said. Alexia Palmer accuses Trump Model Management LLC of lying to the federal government in its work-visa application that said she would be paid a $75,000-a-year salary while living in the United States, according to court documents. Instead, according to court papers, Palmer received a total of $3,880.75 during the three years she was under contract with the agency. The complaint alleges “fraudulent misrepresentation” and violations of U.S. immigration and labor laws. It asks for $225,000 in back pay. The suit was originally filed in October 2014. A decision on a pending motion by Trump Model Management to dismiss is expected by the end of March, the clerk for Judge Analisa Torres, who is presiding over the case in the U.S District Court, Southern District, told Reuters. If Torres rules the case can proceed, it could revive attention on Trump’s foreign labor practices at a time when the celebrity billionaire’s rise in American politics has riveted the world’s attention. Trump’s lawyers have called the case “frivolous” and “without merit.” In court documents, they said Palmer wasn’t an employee and was more than adequately compensated for a “very brief stint as a fashion model,” which they say amounted to less than 10 days of work over three years. Reuters could not independently confirm that assertion.

Tech CEOs, Republicans plot to stop Trump: Report

Top Silicon Valley CEOs met with top Republicans in secret last weekend to discuss stopping Donald Trump from becoming the Republican presidential candidate, a report by the Huffington Post claims. Top tech leaders including Apple CEO Tim Cook, Tesla Motors and SpaceX chief Elon Musk and Google co-founder Larry Page, all met top GOP members at the super-secretive American Enterprise Institute’s annual World Forum, where Trump was the main point of discussion, according to the news site’s anonymous sources. The AEI’s World Forum is the conservative think tank’s yearly press-free event held on a private island resort off the coast of the state of Georgia. People familiar with the event told Huffington Post that the highlight of this year’s forum was a presentation by Republican political guru and former advisor to George W. Bush Karl Rove, which reportedly identified the Republican front-runner’s greatest weaknesses. Rove explained that most voters saw Trump as erratic, and had hard time envisioning him as “presidential” or someone they’d like their children to look up to. He also explained that citizens were wary of having the Republican frontrunner anywhere near a nuclear trigger. Sources said that conversation went on to focused on how Trump managed to gain such a stronghold. The real estate mogul has seen a meteoric rise in the presidential primaries, having already gained more than a third of the delegates needed to win the Republican nomination. The Huffington Post’s full report can be read here.|technology|link|030916|7PM|tech-ceo-stop-trump

Study: Most would be worse off under GOP tax plans

Most Americans would be worse off under Republican presidential candidates’ tax plans once the proposals’ likely offsets are taken into consideration, the liberal-leaning group Citizens for Tax Justice (CTJ) found. The tax plans from Donald Trump,Marco Rubio and Ted Cruz would each cost trillions of dollars over 10 years, and the United States is already projected to face large budget deficits. As a result, the candidates’ tax plans, if enacted, would inevitably lead to spending cuts and/or tax increases, CTJ said in a report released Wednesday. “As this report shows, when those inevitable spending cuts and tax increases are taken into account, the vast majority of Americans will end up as big losers,” the group said. CTJ’s analysis assumes the candidates’ tax cuts would be paid for by equally cutting spending and raising income taxes across-the-board. This is similar to what happened after then-President Ronald Reagan cut taxes in 1981, according to the report. Under CTJ’s model, each person would see the same dollar “cost” from the spending reductions, while tax increases would be allocated based on the overall personal income distribution, the group said. Without considering offsets, CTJ estimates that the tax plans from Trump and Rubio would cut taxes for all, though they would cut taxes the most for the wealthy. However, only the top 5 percent of taxpayers would receive net benefits from the plans when factoring in pay-fors.

Gun-loving Florida mom shot by 4-year-old son hours after bragging he ‘gets jacked up’ to shoot

 A gun-loving social media activist was shot and wounded Tuesday by her 4-year-old son while driving.

Investigators said Jamie Gilt was driving a four-door pickup truck hauling a horse trailer about 3 p.m. when the boy somehow managed to gain access to a .45-caliber handgun and shoot her from the back seat, reported the Florida Times-Union. A Putnam County sheriff’s deputy spotted the 31-year-old Gilt behaving frantically inside the pickup, which was partially parked in a travel lane on Florida 20, authorities said. The bullet passed through Gilt’s torso, and she is expected to survive. Deputies said the boy was not strapped into a booster seat, but they haven’t determined whether he was strapped in at the time of the shooting. Gilt, of Jacksonville, frequently posts about her love of guns and her views on Second Amendment rights, as well as her support for Republican presidential candidate Ted Cruz and racist propaganda. In fact, she boasted the night before the shooting on Facebook that her “4-year-old gets jacked up to target shoot the .22,” in response to her post suggesting that guns are a better response to a burglary than calling 911. The woman apparently maintains a Facebook page called “Jamie Gilt for Gun Sense,” which has been deluged with critical messages since her accidental shooting. She also shared a Twitter post in late January about a new handgun — which she described as her “new toy” — she was excited about receiving. The shooting remains under investigation, and deputies said Gilt could potentially face charges in the incident. “Those questions center around how is the fire arm secured? Where was it carried in the vehicle? And exactly how did the young boy come in possession of the firearm?” said Capt. Joseph Wells, of the Putnam County Sheriff’s Office.


Romney reads his mean tweets

Mitt Romney is interjecting a bit of humor into his criticism of Republican presidential front-runner Donald Trump. Romney appeared on “Jimmy Kimmel Live” on Tuesday night, where he read a series of mean tweets aimed at him from Trump supporters. Romney read a tweet from Trump himself criticizing the 2012 GOP nominee for losing and noting that another rival who challenged Trump this year, Sen. Lindsey Graham (R-S.C.), “got ZERO” and dropped out. “Got zero? The only people I know who got zero are the ones who paid $25,000 to be at Trump University,” Romney quipped. A tweet from a Trump supporter asked where the former Massachusetts governor buys “the shoe polish” for his hair. Romney joked, “I buy it at Costco in bulk.” Trump responded to the jokes Wednesday morning, sarcastically labeling Romney a “wise guy.” “He should be trying to unify the party, not tearing the party apart,” Trump said on “Fox and Friends” after Romney’s speech last week ripping Trump, which polling suggests may have backfired.

“Instead of fighting it, they should be embracing it,” Trump said of his critics in the GOP establishment.

Dos Equis Is Retiring ‘The Most Interesting Man in the World’

After nine years of gallivanting around the globe, the Dos Equis ‘Most Interesting Man in the World’ is retiring later this year. The Heineken-owned beer brand is planning to sunset the ads starring 77-year-old Jonathan Goldsmith, who gained fame for the tagline, “I don’t always drink beer, but when I do, I prefer Dos Equis,” USA Today, reports. The successful campaign has helped Dos Equis triple its business since launching in 2006, with sales rising 10% in the last year alone. According to Heineken, the beer is especially popular among Latino men, a growing part of the U.S. population. In the Most Interesting Man’s final ad, he blasts off on a one-way trip to Mars as characters who have appeared in his ads through the years send him off. Dos Equis is planning to relaunch the campaign later this year with a new, younger Most Interesting Man and plotlines more squarely aimed at Millennials.



US government seeks dismissal of Alabama lawsuit over refugee placement

Attorneys for the U.S. government are asking a federal judge to dismiss a lawsuit filed by the state over placing refugees within Alabama borders. In January, lawyers for the state sought to force the U.S. government to follow the Refugee Act of 1980 and “consult with the state regarding the placement of refugees before those refugees are placed within its borders.” At a news conference after the filing, Alabama Gov. Robert Bentley said they chose to file the lawsuit after receiving no response from federal authorities to questions and concerns about refugee resettlement. “It is my duty as the governor of the state to secure and protect the people of Alabama,” he said at the time. “I am not able to do that if we don’t know who is coming from foreign nations and we know nothing about them and we don’t even know where they go when they leave the state.” The motion to dismiss was filed Tuesday by Michelle R. Bennett and Stuart J. Robinson, attorneys for civil division of the U.S. Department of Justice. The state’s claims are not supported by law because none of the statutes on which the complaint relies require the federal government to consult states before resettling refugees, they argue. As part of the lawsuit, the state is seeking not only additional information on the refugees who have been resettled in Alabama or could be resettled but also their medical histories. And perhaps most importantly, the lawsuit seeks the federal courts order “a certification by the (U.S) secretary of state or the relevant federal official with knowledge … that those refugees pose no security risk.” In the motion to dismiss, the DOJ attorneys write that the Refugee Act of 1980 requires federal authorities to consult regularly with states on the “sponsorship process” and “the intended distribution of refugees among the states.” They are not required to provide information about individual refugees. “That conclusion is not altered by Plaintiffs’ speculative concern that certain individuals among the relatively small number of refugees who have been or will be resettled in Alabama may be terrorists or terrorist sympathizers,” the motion states. “Refugees are one of the most thoroughly vetted populations seeking admission to the United States.” More:

Birmingham residents travel to Montgomery to express concern about Mayor-Council Act changes

 Birmingham residents traveled to Montgomery on Wednesday morning to outline to legislators their concerns about potential changes to the Mayor-Council Act. Two citizens’ groups – Community First Birmingham and Citizens Coalition for a Better Birmingham – are sponsoring the trip. The Mayor-Council Act of 1955 was adopted through a referendum to establish a different form of city governance during a time of upheaval. Walt Wilson, the president of Community First, issued a statement explaining why the trip to Montgomery is vital to Birmingham’s governance going forward. “The Mayor Council Act provides a system of checks and balances in our city,” Wilson said. “Council members are the frontline  representatives for the people of Birmingham, and it’s up to them to make sure that the voices of the people of their district are represented. Though he does a tremendous job, the Mayor can’t be everywhere and know about every issue in every district.  If the proposed changes were to be written into law, then a critical check would be removed from our system of government and the people of Birmingham would suffer.” The goal of the trip is neither a protest nor a rally, but a conversation with legislators about what is best for the city of Birmingham, community activist Frank Matthews said.

He and other citizens want to have these discussions as early as possible because, once a bill is advertised and filed, “it’s almost too late.” “We’re trying to do our due diligence as citizens to represent ourselves,” Matthews said. “We don’t have anyone down here to fight this legislation that wasn’t known about as it was being crafted.” If anyone wants to change how the city operates, they must abide by the Mayor-Council Act, which stipulates that a change must be initiated by a petition and submitted to a vote.

Last week, council members learned that Mayor William Bell had submitted to state legislators, including Rep. Oliver Robinson, suggested changes to the Mayor-Council Act adopted in 1962. The suggestions include making the mayor, not the council, responsible for appointments to the Birmingham Water Works Board and requiring the council to elect new leadership annually. The proposals to transfer power from the Birmingham City Council to the mayor would upset checks and balances while giving the mayor a dangerous amount of authority, Council President Johnathan Austin said Monday. Council members plan to call for a public hearing during which residents can offer their perspective on changes to the act. More:


Bill would ban abortion at detection of fetal heartbeat

 A Senate committee Wednesday approved a bill that would ban abortion at the detection of a fetal heartbeat, despite U.S. Supreme Court decisions that have overturned similar bans in other states. The Senate Health Committee voted 7 to 1 to approve the bill after a brief debate. Sen. Billy Beasley, D-Clayton, was the only no vote. The bill, sponsored by Sen. Gerald Allen, R-Tuscaloosa, would make it a crime for a physician to perform an abortion if a fetal heartbeat was detected. The ban would apply to cases of rape and incest, and would only be waived if the woman’s life was in danger or remove an ecotopic pregnancy or for a fetus with a lethal anomaly. A physician who performed an abortion where a heartbeat was detected could be convicted of a Class C felony, punishable by up to 10 years in prison and $15,000 fine. Terri LaPoint, a Warrior resident who spoke in favor of the bill, argued that research done since Roe v. Wade, the 1973 U.S. Supreme Court decision legalizing abortion in the first trimester, suggested greater development than was known at the time of Roe. “We know what babies look like,” she said. “We know by 12 weeks they are fully developed, just growing.  They are people.” Opponents say with fetal heartbeats detectable as early as five weeks in a pregnancy, the measure would outlaw abortion for many women. Most abortions in Alabama in 2014 occurred before the sixth week of pregnancy, but 3,457 procedures – about 42 of the total – took place after, according to the Alabama Department of Public Health. “I don’t understand the obsession with the heartbeat,” said Xandi Andersen of Montgomery, who spoke against the bill. “There’s nothing magical that happens in pregnancy that makes the woman’s body anybody’s but her own.” Federal courts have struck down similar bans in Arkansas and North Dakota. The U.S. Supreme Court earlier this year declined to review the court ruling that struck down North Dakota’s law. Several opponents also warned that Alabama would quickly end up in the same boat. “Can our state afford the large legal bills to have the honor of fighting and losing a case before the U.S. Supreme Court?” said JoAnn Cummings of Decatur. A similar bill has been filed in the House of Representatives by Rep. Terri Collins, R-Decatur. Collins indicated at a hearing last month that supporters would be willing to go to court over the measure. The Senate Health Committee also approved a House bill sponsored by Rep. April Weaver, R-Brierfield, that would ban the sale of fetal parts in the state. Sen. Bill Hightower, R-Mobile, said it would ensure that no one would “have abortions so they can sell the body parts.” The House passed the bill on Feb. 17 amid questions from Democrats as to the need for it. Beasley repeated those concerns. “As a matter of record, there’s been no sale of body parts in the state of Alabama, is that correct?” he asked Hightower. Hightower said he was not aware of any taking place, and hoped that would remain the csae. Both bills move onto the Senate.


Auburn Drops Hubbard’s Former Employer

MONTGOMERY—Auburn Athletics has granted FOX Sports an exclusive contract to manage its multimedia rights and sponsorship sales, for all of Auburn’s sports initiates. These include, intellectual property rights, radio broadcasts for all sports, coaches’ television shows, live TV rights, athletics publications, and more. The agreement with FOX Sports spells the end of the University’s long-standing relationship with IMG Sports, who purchased the rights from Mike Hubbard in 2003. Hubbard’s Auburn Network radio station has relied heavily on broadcasting Auburn sports, as perhaps its most lucrative revenue stream. Those close to the deal speculate that FOX Sports will turn to another Lee County radio station with a bigger footprint to broadcast Auburn sporting event. Approximately three years ago, Hubbard moved Auburn sports broadcasting to WGZZ 94.3 in Auburn, which is one of the smallest signals in the area. The change has solicited a growing number of complaints because the low-watt signal. Auburn Athletics sponsored a game day focus group in February and one item that was discussed was the poor coverage of Hubbard’s station. Several attendees asked why they could not pick up baseball games in certain areas of town and other sports such as football and basketball could not even be received inside their game day venue whether it was a house, condo, or RV. In a University press release, Auburn Director of Athletics Jay Jacobs said, “FOX Sports will allow us to grow our brand nationally, and enhance our brand value. The entire FOX Sports team has proven how much they believe in Auburn throughout this entire process.” More:


Trump leaves taxpayers in one Alabama town with $30k bill

 MADISON, Ala. — Donald Trump’s massive Alabama event in Madison was huge for his campaign in the state, as he picked up the endorsement of popular U.S. Senator Jeff Sessions. But the event also left the taxpayers of the city with a huge bill.  According to Madison City Council President Tim Holcombe, the city spent over $30,000 to accommodate Mr. Trump’s event. Below is a breakdown of the costs incurred by the city. See at link below. Holcombe said that the Madison City Council was kept in the dark on the event planning. They were not included and had no idea of the costs. Now Holcombe and his fellow council members are dealing with the bill that was left behind after the massive event. “The rally was a great thing, and I’m all for having political rallies, but I felt like we should have been given a heads-up early on that this planning was in process. Certainly we could have assisted along the way,” said Holcombe, who wished that Madison Mayor Trulock had given some notice. “My issue was a lack of communication and the amount of money it took to put the event on.” The money for the event was not budgeted, and the council will have to decide whether to dip into reserves to cover it.  The Madison City Police Department also voiced concerns regarding the event’s scheduling. “I never imagined that I would be notified at 10 minutes after 5 on Thursday afternoon that we needed to plan for an event that takes three weeks to properly plan,” Police Maj. Jim Cooke said.  Trump’s rally was held at a high school football stadium in Madison, and created a “logistical nightmare” for Madison police. “I don’t think you could have picked a worse location for this number of people,” Cooke added. Last week, Mayor Trulock issued the following statement on the Trump event:


Alabama could be where Jeff Bezos builds his next rocket engine

Alabama could be the site of rocket builder Blue Origin’s new engine plant, company officials confirmed this week. The confirmation came during the first ever tour of the once-secretive company’s main factory near Seattle. “We’re talking to your congressional delegation,” one Blue Origin executive told during the tour. The discussion presumably includes what incentives Alabama might offer Blue Origin and how lawmakers could help. The new engine will be the much-awaited replacement for the Russian RD-180 engine that lifts United Launch Alliance rockets and their top secret military satellites today. Congress wants America out of the role of Russia’s customer, and it is pressuring ULA to get a new engine. ULA builds its rockets in Decatur, Ala., and that will be where it builds a new Vulcan rocket under development. Blue Origin has the prime contract to power Vulcan with its BE-4 engine, but ULA has a backup plan involving Aeroject Rocketdyne if Blue Origin fails to deliver. A main reason for Blue Origin’s decision to open its plant to aerospace reporters this week was showing its progress on the BE-4. The tour’s only press handout featured the engine, and there were demonstrations of BE-4 hardware. The first BE-4s will be built in the Washington plant, but eventually Blue Origin wants a new facility. Putting it in Alabama near ULA would have advantages, managers said. Blue Origin founder Jeff Bezos talked about what the company looks for in an expansion site during a Q&A with reporters. “The biggest factor there is talented workforce, that you can really hire people who understand the quality demands of aerospace,” Bezos said. “You really want to be able to get good assembly and integration engineers, you want to be able to get high quality machinists and machine operators and those jobs today are very sophisticated jobs.” “You want to go some place that’s welcoming, that actually wants the company,” Bezos added. “Those are probably the two biggest things.”

House committee approves two bills to loosen Alabama alcohol restrictions

The House Committee on Economic Development and Tourism approved two measures Thursday aimed at loosening alcohol restrictions in the state. SB219 from Sen. William Beasley (D-Clayton) would allow state and retail liquor stores to conduct liquor and wine tastings on premise. The measure would allow 10 percent of stores to do so in the first year and eventually move up to 28 percent within three years. The bill allows for two quarter-ounce tastings of liquor and four one-ounce tastings of wine. Joe Godfrey, Executive Director of the Alabama Citizens Action Program, was on hand to oppose the legislation, urging lawmakers to make it more difficult to get alcohol. “Alcohol is an addictive and mind-altering drug,” Godfrey said. “It destroys homes, it destroys families.” Gina Dearborn, who represented the Distilled Spirits Council, was in favor of the measure. Dearborn noted that 40 states already allow such tastings, and Alabama’s laws would be stricter than most – tastings must begin before 6 p.m. and manufacturers would oversee the tastings at no cost to consumers or retailers. The committee gave the legislation a favorable report by a unanimous vote. HB325 from Rep. James Buskey (D-Mobile) addressed a specific issue concerning Lake Patti Sue in Slocomb. The 160-acre property straddles a wet and dry county and the owner is hoping to sell alcohol at the recreational spot. Buskey’s legislation would allow him to do so, even on portions that sit within the dry county. The bill would make the lake a “commercial development district” and have no bearing on the parts of the county outside of the property. Similar bills have already passed. Again Godfrey objected, asking whether such a move is constitutional. “You’re imposing something on people who have not voted to go wet,” Godfrey said. “We keep inching and, eventually, the plan is for the whole state to be wet. I don’t believe that’s fair to the citizens of that dry county.” Rep. Tommy Hanes (R-Scottsboro), who lives in a dry county, concurred with Godfrey’s reasoning. “It goes against your people if they don’t want it to be wet,” Hanes said. The bill was given a favorable report with Hanes the only one to vote against it.

Coleman Ordered to Turn Over Secret Recordings

MONTGOMERY—Attorney and radio talk show host, Baron Coleman, has been ordered to turn over secret recordings to the trial Judge in the felony corruption case of Speaker Mike Hubbard. Coleman, said he has recorded the Attorney General’s Chief of the Special Prosecutions Unit, Matt Hart, and perhaps others without their knowledge. Order for Coleman Judge Jacob Walker, III, on Wednesday, ordered Coleman to turn over all tape recordings he has claimed show Grand Jury leaks. Coleman alleges to have been given some Grand Jury information, illegally. Coleman has also told the court he “concluded” and “put two and two together,” to accuse Hart, of giving him secret Grand Jury information. In a sworn affidavit given to Hubbard’s attorneys on February 2, Coleman claimed he had between 50 and 100 conversations with Hart. At the recent hearing on alleged prosecutorial misconduct, Coleman said he secretly recorded Hart. Coleman also said he had emails he believed would further illuminate his claims. In his order, Judge Walker states the emails may not necessarily be between Hart and Coleman, implying Coleman has other targets. Coleman has told several individuals who asked not to be named, that he was going to destroy Hart or Hart was going to destroy him. Judge Walker said the tapes and emails will be held by the court for an in camera review. In February, Coleman was identified by the State as a Confidential Informant. Acting Attorney General Van Davis filed a Motion for Protective Order to “Prevent Disclosure of Information from Former Confidential Informant, Baron Coleman.” Coleman has denied he was a Confidential Informant. At the March 3, evidentiary hearing into Coleman’s claims, Judge Walker said he would decide if Coleman was in fact a confidential informant. The day before the hearing, a portion of one of Coleman’s tapes was leaked to ‪ The State claims that as a confidential informant, any communications between Coleman and the AG’s office, “is privileged and rightly protected from disclosure.” The motion reiterated that evidence had been submitted to Judge Jacob Walker, III, “for ex parte and in camera review,” proving Coleman’s status as a confidential informant.


After Tuesday’s results, all eyes are on Paul Ryan and Mitch McConnell

After Donald Trump’s wins in three out of Tuesday’s four contests, it is becoming more apparent that the day of reckoning for the Republican Party could come after the primaries on March 15.  Right now, everyone can still hide behind the fact that Trump is not yet certain to be the Republican nominee, but that dodge is becoming more tenuous with every passing day.  People of clear conscience are obviously struggling with the notion of being for Trump if he is our nominee – for reasons too numerous to list here – so what’s a good Republican to do?  I suspect many people, like me, say they can’t see themselves supporting Trump, but what does what mean?  Does it mean voting for Hillary Clinton in the general election?  I’m certainly not there. How do you square voting for Trump with always putting country ahead of everything else, including the party? Over the next few weeks, I think all eyes will turn to Speaker of the House Paul Ryan (R-Wisc.) and Senate Majority Leader Mitch McConnell (R-Ky.) for guidance.  Will they voice support for Trump if he wins big next week?  Will they continue to defer until the convention?  Ryan and McConnell could bring Trump a lot of peace, but I’m not sure if Trump wants to reciprocate.  And who could blame Ryan and McConnell if they have doubts about Trump’s loyalty and reliability? It is satisfying for those of us who don’t see Trump’s appeal to recount all the latest instances of his buffoonery – including his cheesy display of Trump steaks, Trump water and Trump wine during his victory speech last night – but to do so is mostly pointless.  As I’ve said before, he does not have any positive attributes, he just seems to have the most votes – and in an election, that’s what counts. Another salient point that does not register with voters is how remarkably well Ohio Gov. John Kasich does in national head-to-head general election polling.  According to the RealClearPolitics average, Kasich is polling more than seven points ahead of Hillary Clinton – the best of any of the Republican candidates – and comes the closest to beating Sen. Bernie Sanders (D-VT), lagging only half a point behind.  Donald Trump, on the other hand, is the only Republican candidate who, according to those same polls, wouldn’t beat either Clinton or Sanders in a general election.  Obviously, Kasich is someone that everyone could be proud of as their president.  No Republican would be embarrassed with him as their nominee, and Republican candidates wouldn’t be adverse to sharing a platform with him in the general election.  Still, he’s nowhere close to winning. You hear a lot of buzz about a Trump-Kasich ticket, but when I mentioned this prospect to close confidants of Kasich I got more than the standard denials — a lot more. But here we are. Sooner or later it may come to pass that Ryan and McConnell will have to speak up, send a clear signal and supply the party faithful with a theme for the campaign and a rationale for what it means to have Donald Trump as the Republican nominee.


Be Strong, Judge Walker, For Alabama

Perhaps this is it. Perhaps Speaker of the House Mike Hubbard won’t be able to delay his corruption trial yet again. Perhaps we’re another day closer to putting this horrid scandal behind us. Or, should I say, away from us. What’s occurred will never be behind us. It’ll forever be in the history of Alabama. Yes, even if Mike Hubbard is acquitted of all 23 corruption charges, it existed during some of the most crucial times when Alabama needed leadership it didn’t have. The damage is certainly permanent. As was the damage caused by previous Alabama politicians caught up in corruption scandals. They damage our state’s image – frankly, an image that didn’t need any more damage. The damage is done, and so many in Alabama leadership positions shrug and say: “So, what?” The Republicans came in, all full of themselves, ready to govern. Except they didn’t know how. They embarrassed themselves and picked on teachers, public sector workers, and the poor. As usual. If this were new to Alabama, it’d be even more scandalous. Sadly, it’s not new, and that’s scandalous in itself. As my editor here at Alabama Political Reporter so well noted this week, Lee County Judge Jacob Walker III is at the forefront. Walker has kept the Hubbard case on schedule as much as he could, despite desperate attempts by Hubbard to do most anything to get the trial delayed. That trial is set for March 28, and Walker appears firmly determined that it’ll go forward this time. Considering the pressure Hubbard and friends have put on just about everybody – government officials, friends, members of the media – it’s encouraging that Walker is staying the course. That Hubbard so bad wants yet another delay, what does that say about Hubbard’s chances of surviving the trial? To observers, it says Hubbard has lots to hide. So much so, that he’d rather outlast it than face it. But eventually, Hubbard must face it. Let’s hope that face-to-face comes starting March 28. To say Hubbard is a disappointment is an understatement. His promise, like so many other Alabama politicians, has turned into a nightmare for him, his family and, yes, most important, our state. The leadership of Gov. Robert Bentley and Senate leader Del Marsh have been underwhelming. But Hubbard has been a disaster. Why the Speaker insists on seeing it through – and why Republicans who said they could govern let him – is a great mystery. More:


Morning Money

NO MORE TREASURY SECRETARIES FROM WALL STREET? At Wednesday night’s Democratic debate, Hillary Clinton said she would consult with Elizabeth Warren on personnel, and supports a bill that would slow the revolving door between Wall Street and Washington. “I do agree that we have to end the revolving door,” Clinton said. “I will be looking for people who will put the interests of consumers first, who will do more to try to make sure Main Street flourishes and I will very much reach out and ask for advice as to who should be appointed, including to Senator Warren and many of my other former colleagues in the Senate.” That may be just what Warren wants to hear before she gives her coveted endorsement in the race. Warren is likely to want assurances that a Clinton administration won’t consider financiers for key jobs.

M&A FLURRY FOR EXCHANGE COMPANIES: Nasdaq Inc. on Wednesday said it will pay $1.1 billion to buy an options-exchange business from Deutsche Boerse Group. The International Securities Exchange (ISE)’s three exchanges comprise more than 15 percent of trading in U.S. options, Nasdaq said. In Washington, ISE’s lobbying concerns ranged from financial transaction taxation to legislation affecting the gaming industry. The deal, expected to close in the second half of 2016, comes as Deutsche is in merger negotiations with the London Stock Exchange. But Intercontinental Exchange Inc. (ICE) is also bidding to buy LSE. Our colleague Francesco Guerrera reported on Wednesday some of ICE’s arguments for why it should own LSE. These included ICE’s argument that its deal will not be a “tax inversion.”

SPEAKING OF NASDAQ: POLITICO’s chief economic correspondent — and your usual MM host — Ben White will be interviewing Mohamed El-Erian at Nasdaq’s 4 Times Square building this morning. Then they’re ringing the stock market opening bell. El-Erian is chief economic advisor with Allianz and Chair of President Obama’s Global Development Council. He recently published a new book about central banks, “The Only Game in Town.” A livestream of POLITICO’s “America’s Fiscal Future” event will be available at 8:00 a.m. ET here:

DEBTTRAPDEBBIE CAMPAIGN HITS WASSERMAN-SCHULTZ: Democratic Party chair Debbie Wasserman Schultz has a lot to worry about, what with the insanity of presidential primary season. Now a liberal group is giving her one more headache: Allied Progress is airing cable ads slamming the Florida congresswoman for taking money from payday lenders — and signing on to co-sponsor legislation delaying the Consumer Financial Protection Bureau’s payday lending rules. A Pew study found that the average Floridian borrows nine of the short-term high-interest loans annually, and pays more than 300 percent interest, POLITICO’s Nolan McCaskill writes. The DNC didn’t respond to a request for comment:

DRIVING THE DAY: Former White House adviser Seth Wheeler is among the speakers at a George Washington University Law School event about the convergence of finance, technology and the law. … A conference for the Investment Adviser Association kicks off with a Q&A with Democrat SEC Commissioner Kara Stein.

BUSINESSWEEK COVER STORY: “The Last Days of the Shale King — Aubrey McClendon, 1959-2016.” By Bryan Gruley, Joe Carroll, and Asjylyn Loder.

MORE LAWMAKERS SPEAK UP FOR CUSTODIAN BANKS: Reps. Randy Hultgren (R-Ill) and Bill Foster (D-Ill) have asked banking regulators for more details about the September 2014 rule regarding the “supplementary leverage ratio.” The rule aligned the U.S. with global requirements for how much cash banks have to keep as a cushion against losses. The lawmakers said they have concerns with how the rule affects custodian banks like State Street and BNY Mellon. “We urge you to take these concerns into consideration and ask you provide clarity to these financial institutions and their customers,” the March 4 letter said. In October, some lawmakers from Massachusetts made a similar inquiry.

KASHKARI KEEPS GOING: Details of the schedule for Minneapolis Fed President Neel Kashkari’s first symposium on too-big-to-fail are starting to come out. The April 4 event in Minnesota is the first follow-up to Kashkari’s bombshell last month that he’d personally seek to shrink the biggest banks. The all-day affair will include panels filled with academics, think-tankers and financial industry consultants like Promontory Financial CEO Eugene Ludwig; Adam Posen, president of the Peterson Institute of International Economics and former Fed board member Randall Kroszner, now at the University of Chicago. There will also be a chance to lob questions at Kashkari during a town hall.

MORE POLITICAL HEAT ON FED: Today, at the Federal Reserve banks in Washington DC, New York, Cleveland, St. Louis, Atlanta, Philadelphia and Charlotte, activists representing labor unions and other liberal-leaning causes will be campaigning against interest-rate hikes. “Working class activists from the Fed Up Coalition, which campaigns for the Federal Reserve to adopt pro-worker policies, will gather in the morning in their signature green t-shirts to hand out flyers to Fed employees as they arrive to work,” the activists said. The Federal Open Market Committee meets on March 16 to consider rate changes.

MORTGAGE MARKET IMPLODES, HORSES BENEFIT: The Wall Street Journal is out with a look at where the $110 billion in mortgage-related settlements from big banks has gone. One beneficiary: Horses who attend the New York state fair. They’re getting a new barn and stables. Police in New Jersey are getting e-mail accounts. Not surprisingly, the lion’s share of the money is still sloshing around the federal government, write Christina Rexrode and Emily Glazer. Fannie Mae and Freddie Mac got $39 billion. Treasury: $14.5 billion.

WARREN THREATENS EDUCATION DEPARTMENT NOMINEE: Politico’s Maggie Severns reports that Sen. Elizabeth Warren used a committee vote on John B. King Jr.’s nomination for education secretary to blast the Education Department over its handling of for-profit colleges and student loans and to threaten not to support his confirmation on the Senate floor.

BLOOMBERG BURIES THE AXE: Michael Bloomberg released a statement following the death of John Gutfreund, the original Bond King at Salomon Brothers, who died on Wednesday. He was 86. “John Gutfreund hired and fired me – and I’m grateful he did both,” Bloomberg said. “Along with Billy Salomon, he was a mentor and friend who taught me about hard work, management, leadership, and philanthropy. He had a profound impact on my life.”

POTUS Events

9:00 am || Welcomes Canadian Prime Minister Trudeau and his wife to the White House; South Lawn
10:05 am || Holds a bilateral meeting with Prime Minister Trudeau
11:40 am || Holds a press conference with Prime Minister Trudeau
8:40 pm || Holds a State Dinner with the Trudeaus

All times Eastern
Live stream of Obama press conference at 11:40 am

Floor Action

The House is out. The Senate is in at 9:30 a.m. and will resume work on the opioid addiction bill. Final passage vote is scheduled for 11:30 a.m. Then Sen. Rand Paul (R-Ky.) is expected to make his move forcing a vote on legislation blocking the sale of F-16 fighter jets to Pakistan.


Tax Savings from Higher Education Costs

Money you paid for higher education in 2015 can mean tax savings in 2016. If you, your spouse or your dependent took post-high school coursework last year, there may be a tax credit or deduction for you. Here are some facts from the IRS about key tax breaks for higher education.

The American Opportunity Credit (AOTC) is:

  • Worth up to $2,500 per eligible student.
  • Used only for the first four years at an eligible college or vocational school.
  • For students earning a degree or other recognized credential.
  • For students going to school at least half-time for at least one academic period that started  during or shortly after the tax year. Claimed on your tax return using Form 8863, Education Credits.

The Lifetime Learning Credit (LLC) is:

  • Worth up to $2,000 per tax return, per year, no matter how many students qualify.
  • For all years of higher education, including classes for learning or improving job skills.
  • Claimed on your tax return using Form 8863, Education Credits.

The Tuition and Fees Deduction is:

  • Claimed as an adjustment to income.
  • Claimed whether or not you itemize.
  • Limited to tuition and certain related expenses required for enrollment or attendance at eligible schools.
  • Worth up to $4,000.


  • You should receive Form 1098-T, Tuition Statement, from your school by Feb. 1, 2016. Your school also sends a copy to the IRS.
  • You may only claim qualifying expenses paid in 2015.
  • You can’t claim either credit if someone else claims you as a dependent.
  • You can’t claim either AOTC or LLC and the Tuition and Fees Deduction for the same student or for the same expense, in the same year.
  • Income limits could reduce the amount of credits or deductions you can claim.
  • The Interactive Tax Assistant tool on can help you check your eligibility.

IRS Free File. You can use IRS Free File to prepare and e-file your federal tax return for free. File Form 8863, Education Credits, with your Form 1040. Free File is only available at

Krebs Daily Briefing 4 March 2016

Thomas L. Krebs, Securities Litigation, Regulation and Compliance Attorney Lawyer (c)2014 Brandon L. Blankenship
Thomas L. Krebs


Brazil’s Ex-Leader, Luiz Inácio Lula da Silva, Is Held for Questioning

RIO DE JANEIRO — Police officers on Friday raided the home of Luiz Inácio Lula da Silva, the former president of Brazil under investigation in a colossal graft scheme involving the national oil company, and took him into custody. In an operation that began at 6 a.m., officers from the Federal Police swarmed Mr. da Silva’s home in São Paulo. He was taken to a federal police station at Congonhas Airport for questioning, but he has not been arrested or charged. Universally known as Lula, Mr. da Silva, 70, remains a towering figure in the governing left-wing Workers’ Party. He was president from 2003through 2010, and he continues to exert considerable sway as one of Brazil’s most powerful people. More than any other politician, Mr. da Silva was the face of Brazil at a time when the country, Latin America’s largest, emerged as a rising power in the developing world, boasting huge offshore oil discoveries and thriving trade with China. The expanding criminal investigation comes at a time of growing political and economic turmoil in Brazil, with Mr. da Silva and his successor, President Dilma Rousseff, grappling with a downturn in global commodity prices and with soaring discontent over reports of corruption at nearly every level of government. More:

Syria rebels say government mobilizes despite truce

A major Syrian insurgent group said on Friday the government was mobilizing forces to capture more territory, and a ceasefire was not possible while Damascus and its allies kept up attacks, signaling risks to an agreement that has slowed fighting. The comments by the Jaish al-Islam group, an influential player in the Syrian opposition, demonstrate the challenge facing foreign governments hoping “the cessation of hostilities” agreement will allow for a resumption of peace talks next week. The Syrian opposition appears at odds with its Western backers over the success of the truce. European leaders told Russian President Vladimir Putin they welcomed the fact the fragile truce appeared to be holding, and it should be used to try to secure peace without President Bashar al-Assad. The agreement that came into effect on Saturday has slowed the pace of the war in Syria, but rebels fighting Assad say the government has kept up attacks on strategically important frontlines in northwestern Syria. The opposition has yet to say whether it will attend peace talks planned for March 9. Assad, his war effort buoyed by five months of Russian air strikes, has said the army is respecting the agreement. The truce does not cover the al Qaeda-linked Nusra Front or Islamic State, two groups which Moscow and Damascus have said they will continue to fight. The Nusra Front is widely deployed across western Syria in close proximity to groups that agreed to cease fire and are viewed as moderate by the West. Syrian state media have said very little about operations in western Syria since Saturday. Mohamad Alloush, head of Jaish al-Islam’s political office, told Reuters “big violations by the regime” had allowed it to take new areas using “all types of weapons, particularly planes and barrel bombs in some areas”. There were also “mobilizations to occupy very important strategic areas”, he said. His group, in a separate statement, said the war had not stopped as far as it was concerned, and that a ceasefire was not possible while “militias and states kill our people”.

The head of another rebel group, who asked not to be identified for security reasons, said 40 army vehicles loaded with weaponry were seen heading northwards on Thursday night. “The regime is moving forces from place to place, preparing for operations,” said the commander, whose group has also committed to the cessation of hostilities agreement.


U.S. payrolls surge, bolster Fed rate hike prospects

U.S. employment gains surged in February, the clearest sign yet of labor market strength that could further ease fears the economy was heading into recession and allow the Federal Reserve to gradually raise interest rates this year. Nonfarm payrolls increased by 242,000 jobs last month, the Labor Department said on Friday. The unemployment rate held at an eight-year low of 4.9 percent even as more people piled into the labor market. “This is the best news the Fed could have expected going into the meeting. With jobs bouncing back, you can be sure that rate hikes are just around the corner,” said Chris Rupkey, chief economist at MUFG Union Bank in New York. The economy added 30,000 more jobs in December and January than previously reported. The only blemish in the report was a three-cent drop in average hourly earnings, but that was mostly because of a calendar quirk.  The average length of the workweek also fell last month. Economists had forecast employment increasing by 190,000 last month and the jobless rate holding steady.  The employment report added to data such as consumer and business spending in suggesting the economy had regained momentum after growth slowed to a 1.0 percent annual rate in the fourth quarter. Growth estimates for the first quarter are around a 2.5 percent rate. Fears of a recession in the wake of poor economic reports in December and slowing growth in China sparked a global stock market rout at the start of the year, causing financial market conditions to tighten.


The Mystery Madoff Victims Who Left $2.5 Billion on the Table

Ever since Bernie Madoff’s Ponzi scheme collapsed in 2008, it’s been much-rumored that investors included tax dodgers shielding money from the IRS, drug dealers who laundered proceeds through the con man and wealthy moguls hiding assets from ex-spouses. After all, the scheme wiped out $20 billion of investors’ money, but the victims’ claims for repayment total just $17.5 billion. Who would walk away from $2.5 billion, and why? Part of the answer may be far less mysterious or dubious than thought. Almost half of the unclaimed money can be traced to a couple of Caribbean-based hedge funds. Their reason, while unknown, may have amounted to a calculated decision that any recovery on their $1.2 billion of claims would be tiny compared with what they might be forced to give back if they got tangled up in U.S. courts, according to lawyers familiar with the recovery process. As for the remaining $1.3 billion in unclaimed money, experts are left to ponder. Unlike the two funds, these are likely individual investors who had a variety of reasons to shy away from the claims process, especially at a time when victims were expecting to recover only 4 or 5 cents on the dollar, legal experts say. “What’s the downside of putting a claim in and seeing what happens, unless somebody doesn’t want their own affairs being scrutinized?” said Richard Scheff, a former federal prosecutor. Some of these people may be kicking themselves now; victims are getting 57 cents on the dollar. More:


Pension Benefit Cuts Planned at T.V.A., Breaking a Federal Firewall

Politicians in states around the country have moved in recent years to rein in the pensions of government employees, which in many cases had become more generous and less risky than those of their private sector counterparts. Now that movement may be breaching yet another firewall: the pensions of federal employees. On Thursday, the board of the Tennessee Valley Authority Retirement System, the pension program for roughly 11,000 workers and 24,000 retirees at the venerable New Deal-era agency, approved a tentative plan to lower the system’s funding shortfall by reducing benefits.The plan will be implemented later this year if the T.V.A.’s management and board go along with it. The immediate impetus for voting on the changes was a proposal put forth in December by William D. Johnson, the agency’s chief executive, who argues that demographic trends and the retirement system’s historical generosity make it unsustainable. Mr. Johnson’s proposal, a modified version of which the board embraced, called for shifting many employees from a pension that guarantees a fixed level of benefits, a feature of most federal employees’ retirement package, to a 401(k) plan. It would have also lowered the cap on cost-of-living increases even for current retirees, effectively cutting a benefit they had already earned. But what has elevated an increasingly common debate about pensions into a larger controversy about inequality is Mr. Johnson’s decision to exempt from the cutbacks the benefits that he and other executives receive through a supplemental retirement plan. (Their benefits in the general T.V.A. pension plan would be subject to the same cuts as other workers.) That is particularly galling to union officials at the T.V.A., who point out that Mr. Johnson’s total compensation in 2015 was approximately $6.4 million, which is believed to be the highest pay for any federal employee in the country. President Obama earns a salary of $400,000. Moreover, Mr. Johnson’s plan runs counter to common practice in the private sector. More:


Retirees Win Lengthy Pension Fight With Renco’s Ira Rennert

A group of retirees whose pensions were cut three years ago have won a lengthy battle with the multibillionaire Ira Rennert, a mining industrialist, junk bond king and owner of a Hamptons mega-mansion. The retirees’ victory is only the second time in 42 years that the federal Pension Benefit Guaranty Corporation has required a company to unwind a pension “termination” — a dreaded deal in which a bankrupt company cuts off a pension fund and leaves it for the government to take over. The government insures company pensions, but its insurance is limited, so retirees can face sharp losses. In a settlement announced Friday, Mr. Rennert’s sprawling conglomerate, the Renco Group, will be required to pay — in full — the pensions of about 1,350 retirees who worked at a subsidiary, R.G. Steel, which went bankrupt in 2012 and is being liquidated. That means reversing pension cuts that were made in their plan’s termination. Tom Reeder, executive director of the pension insurer, called the settlement “an extraordinary outcome for plan participants” because it is so rare for pensions to be cut and then restored to their original value. The settlement dates the restoration to November 2012, the termination date and is meant eventually to make the retirees whole for the money they missed in the period when their benefits had been reduced. Mr. Reeder also said Renco had agreed to reimburse the pension agency for its outlays. “Renco denies any liability or wrongdoing,” a spokesman for Renco said in a statement. “However, settlement with P.B.G.C. was the most sensible, economic, and practical resolution to the dispute, and it puts an end to the significant expense and distraction of continued litigation.” Typically, the federal agency takes over a failing pension plan if a judge rules that doing so is the only way a company can possibly restructure. It has taken that step for more than 4,600 pension plans since its founding in 1974. The retirees then typically get their checks from the agency for the rest of their lives.


Conservative Lawmakers Push New Legal Protections for Opponents of Gay Rights

 ATLANTA — Less than a year after the Supreme Court recognized a constitutional right to same-sex marriage, conservative lawmakers across the country are pushing for a new round of legal protections for opponents of gay rights. But the proposals are meeting the kind of resistance from business interests and gay rights groups that similarly motivated, but less specific, legislation faced last year in Arkansas and Indiana. The dispute is escalating here in Georgia, where the Senate last month approved a measure barring “adverse action” by the government against anyone following religious beliefs about marriage, including “that marriage should only be between a man and a woman.” Though some of Georgia’s senior elected officials, including the House speaker and governor, both Republicans, have expressed caution about the proposal, business groups are taking no chances. “We think the lessons learned in Indiana should allow for some straight thinking by our Legislature that this would be harmful to Georgia if passed in the current form,” said Jenner Wood, the chairman of the Metro Atlanta Chamber of Commerce and one of the founders of Georgia Prospers, a coalition of more than 400 companies, including Coca-Cola and Google, that oppose the bill. Lawmakers in at least seven other states have proposed similar bills, according to the Human Rights Campaign, a gay rights group. The measures are usually known as First Amendment Defense Acts, a new front in the legislative conflict over religion and gay rights. These bills differ from last year’s legislation in Indiana and Arkansas, where supporters described the proposals as religious freedom laws. Such laws, versions of which are on the books in 21 states and at the federal level, are intended to strengthen but not guarantee the legal position of people whose religious beliefs are in conflict with existing law; none specifically mention same-sex marriage. More:


Divide Grows in Southeast Over Offshore Drilling Plan

KURE BEACH, N.C. — On a recent frigid night, anxious residents, many in “Protect Our Coast” sweatshirts, packed the town hall here, spilled onto the lawn, and then erupted in cheers as their town government gaveled in a resolution urging President Obama to block oil drilling off their shoreline. “Some things are just too precious to risk,” Mayor Emilie Swearingen said. That afternoon, 140 miles inland in Raleigh, the state capital, Obama administration officials and oilcompany representatives had outlined plans to move forward with the drilling before a very different crowd, and state lawmakers liked what they heard. “You’re talking about creating over 100,000 jobs,” said Michael Hager, the House Republican leader. “You’re doggone right this is good for the state.” Within weeks, the Obama administration is expected to release a proposal to open up vast tracts of federal waters in the southern Atlantic to oil and gas drilling for the first time, and a divide is growing between the Southeast’s coast and its landlocked capitals. The plan, written by the Interior Department, is expected to delineate the waters that would eventually be auctioned and leased to energy companies, which in turn would bring the drilling industry to the banks of Georgia, Virginia and North and South Carolina, along with thousands of oil rigs well over the horizon from the beach. The move has the backing of the Republican governors of Georgia, North Carolina and South Carolina, and the Democratic governor of Virginia, along with Republican majorities in all those state legislatures. From Raleigh to Richmond, statehouse denizens see new jobs and billions of dollars from royalty revenues to improve roads, schools and public salaries. Among the highest profile politicians in the capitals, at least one, Virginia’s lieutenant governor, Ralph S. Northam, is opposed, although his voice is lonely. Last Thursday, he sent a letter to Obama administration officials asking them to exclude Virginia’s waters from the offshore drilling plan.


One clear loser in Thursday’s debate: the Grand Old Party

 It’s highly questionable whether anyone emerged as the winner in Thursday’s Republican presidential debate in Detroit, though the candidates’ spinmeisters would all quibble with that. There was one clear loser: the Grand Old Party. The 11th debate of the Republican campaign tested the patience and the limits of viewers and voters. Insults and interruptions overwhelmed sober discussion. The raucous audience, now a staple of the GOP debates, only added to the sense of game-show politics.

Can anyone credibly suggest that the Republicans put their collective best face forward on Thursday night? At a time when the party is in crisis over the possibility that Donald Trump will become the nominee, the debate did next-to-nothing to make Trump or his three remaining candidates look or sound presidential. It’s highly questionable whether anyone emerged as the winner in Thursday’s Republican presidential debate in Detroit, though the candidates’ spinmeisters would all quibble with that. There was one clear loser: the Grand Old Party. The 11th debate of the Republican campaign tested the patience and the limits of viewers and voters. Insults and interruptions overwhelmed sober discussion. The raucous audience, now a staple of the GOP debates, only added to the sense of game-show politics.

Can anyone credibly suggest that the Republicans put their collective best face forward on Thursday night? At a time when the party is in crisis over the possibility that Donald Trump will become the nominee, the debate did next-to-nothing to make Trump or his three remaining candidates look or sound presidential.


Security Logs of Hillary Clinton’s Email Server Are Said to Show No Evidence of Hacking

WASHINGTON — A former aide to Hillary Clinton has turned over to theF.B.I. computer security logs from Mrs. Clinton’s private server, records that showed no evidence of foreign hacking, according to people close to a federal investigation into Mrs. Clinton’s emails. The security logs bolster Mrs. Clinton’s assertion that her use of a personal email account to conduct State Department business while she was the secretary of state did not put American secrets into the hands of hackers or foreign governments. The former aide, Bryan Pagliano, began cooperating with federal agents last fall, according to interviews with a federal law enforcement official and others close to the case. Mr. Pagliano described how he set up the server in Mrs. Clinton’s home in Chappaqua, N.Y., and according to two of the people, he provided agents the security logs. The law enforcement official described the interview as routine. Most of those close to the case spoke on condition of anonymity because they were not authorized to discuss the continuing investigation. Mrs. Clinton’s work-related emails as secretary of state, which have been made public as part of a Freedom of Information Act lawsuit, show that she received spam emails intended to try to lure her into clicking a malicious link. Those emails, known as “spear phishing” attempts, were traced to Russia, but it was not clear from the emails alone whether anyone clicked on those links or whether the security was compromised. More:


Romney, McCain: Trump a danger for America’s future

 SALT LAKE CITY (AP) — In an extraordinary display of Republican chaos, the party’s most recent presidential nominees, Mitt Romney and John McCain, lambasted current front-runner Donald Trump on Thursday, calling him unfit for office and a danger for the nation and the GOP. “His is not the temperament of a stable, thoughtful leader,” Romney declared. He called Trump “a phony” who is “playing the American public for suckers,” a man whose “imagination must not be married to real power.”

The vicious feud marked a near-unprecedented scenario pitting the Republican Party’s most prominent leaders, past and present, against each other as Democrats begin to unite around Hillary Clinton.

The criticism set the tone for a primetime debate in which Trump lashed back, calling Romney “a failed candidate” who lost to Barack Obama four years ago because he was such a poor candidate. The loss, Trump charged, was “an embarrassment.” And yet, in reply to the last question of Thursday night’s debate, each of the remaining candidates — Ted Cruz, Marco Rubio and John Kasich — said they would support Trump if he was the presidential nominee of their party. Underlying the clash is a bleak reality for panicking Republican officials: Beyond harsh words, there is little they see to stop Trump’s march toward the presidential nomination. Party leaders are poring over complicated delegate math, outlining hazy scenarios for a contested national convention and even flirting with the idea of a third-party effort.

Romney confidant Ron Kaufman, a senior member of the Republican National Committee, openly embraced the possibility of a contested convention: “If that’s the only way to stop Trump, it makes sense,” he told The Associated Press. In the most notable verbal attacks against Trump to date, Romney and his 2012 running mate, House Speaker Paul Ryan, urged voters in the strongest terms to shun the former reality television star for the good of country and party. The GOP’s 2008 nominee, Arizona Sen. McCain, joined in, raising “many concerns about Mr. Trump’s uninformed and indeed dangerous statements on national security issues.” That echoes the worries of dozens of leading conservative defense and foreign policy officials.


Donald Trump’s deep insecurity about his “short fingers,” explained

There are two criticisms Republican presidential frontrunner Donald Trump absolutely cannot tolerate. The first is that he isn’t as rich as he claims to be. The second? Call Trump a racist or a bully or a xenophobe if you must, but do not, under any circumstances, insult the length of his fingers. Last week, Sen. Marco Rubio did just that: “I don’t understand why his hands are the size of someone who is 5-foot-2,” Rubio said of Trump, adding: “And you know what they say about men with small hands? You can’t trust them.” That isn’t actually what they say about men with small hands, but we’ll get to that in a minute. Rubio didn’t pick his insult at random. Trump’s sensitivity about his short fingers has a long, entertaining, very Trump-like backstory — one that, like so much of the 2016 presidential race, has its roots in the early 1990s. Accusations of below-average finger size have dogged Trump for nearly 30 years. In 1988, Spy, a satirical magazine based in New York, coined an epithet for Trump that it would gleefully repeat for eight years: “short-fingered vulgarian.” Spy, which was published from 1986 to 1998, was busy skewering celebrities and public figures as Trump was building his national profile. Proudly avaricious and braggadocious, Trump embodied the spirit of the ’80s. And Spy made him a frequent target of not just insults but also elaborate practical jokes. “Donald Trump was our clickbait,” Bruce Feirstein, a contributing editor for Spy, wrote for Vanity Fair in 2015: He brought us word-of-mouth recognition, and more readers—just the same way he is now bringing eyeballs to newscasts, and page views to Web sites… Over the course of our years at Spy, we fact-checked his books and his finances (with predictable results), trolled him by sending miniscule checks — as low as 13 cents —to see if he’d cash them (he did), and wrote up his all-but-forgotten business debacles. (Remember the “Trump Castle World Power Boat Championship“?) “Two-month anniversary of the publication of short-fingered vulgarian Donald Trump’s The Art of the Deal,” Spy noted in January 1988, its first use of the phrase. “Reader … is rushed to the hospital with hubris shock.” (The same issue, presciently, floated the possibility of a Trump presidential bid, citing a survey that found 4 percent of Americans were sad he wasn’t in the running.) Spy would call Trump a “short-fingered vulgarian” 12 times in the next eight years, including once reprinting a correction from the Stanford student newspaper, which had written the phrase as “short-fingered Bulgarian” and had to apologize for insulting Bulgarians. Trump, an expert troll, was getting trolled. He rose to the bait, responding in characteristic fashion: scribbling on the article in Sharpie marker and sending it to its writers. (“Face of a dog!” he once wrote over a photo of New York Times columnist Gail Collins, who had committed the other ultimate infraction: downplaying Trump’s wealth by calling him a “thousandaire.”) What upset Trump wasn’t being called a “vulgarian,” a rich person with bad manners. It was the slur on his finger length. “To this day, I receive the occasional envelope from Trump,” Graydon Carter, a founder of Spy and now the editor of Vanity Fair, wrote in 2015. “There is always a photo of him — generally a tear sheet from a magazine. On all of them he has circled his hand in gold Sharpie in a valiant effort to highlight the length of his fingers. I almost feel sorry for the poor fellow because, to me, the fingers still look abnormally stubby.” More:


Judge likely to delay Alabama Speaker Hubbard’s corruption trial

The judge in the corruption case of House Speaker Mike Hubbard said Thursday he is inclined to grant a short delay in the start of the trial now scheduled for March 28. Lee County Circuit Court Judge Jacob Walker gave no specific new date for the trial to start but said later in the spring might be the new time. Walker also Thursday said he would take under advisement a request by state prosecutors that he put under a protective order any further release of hours of secret audio recordings made by a one-time Hubbard opponent, Baron Coleman, and the lead prosecutor in the case, Matt Hart. Wednesday night obtained a part of one Coleman recording that has Hart telling Coleman he is not a “confidential informant” in the case, a potential key contention the state has claimed. Walker gave wide latitude Thursday to Coleman, a Montgomery lawyer, political consultant and radio talk show host, to describe a years-long relationship with Hart where he “concluded” that Hart had leaked secret grand jury information to him. Coleman spent almost 90 minutes on the witness stand describing his relationship with Hart. Coleman said he and Hart talked often beginning in 2012 about lots of things but nothing as much as the then-building investigation Hart had launched against Hubbard that same year. Originally Coleman had provided some information to Hart about possible Hubbard wrongdoing. From those first conversations Coleman said he and Hart developed a relationship that resulted in Hart feeding Coleman information that he would use against Hubbard in an effort to defeat his bid for re-election in 2014 and to criticize Hubbard on Coleman’s radio show where he gained a reputation as one of Hubbard’s harshest critics. Coleman said at some point in their relationship he “concluded” Hart was sharing information from the grand jury in an ongoing effort to damage Hubbard. But under cross examination by state prosecutors Coleman was careful to say that he did not know for a fact if the information Hart shared with him had come from the grand jury. But more than once Coleman, in pushing back against prosecutors, said “I am not an idiot” when defending his conclusion that countless hours of conversations coupled with his trolling the site of the grand jury meetings convinced him Hart was providing information from the grand jury. Hubbard’s defense team has contended that Hart has engaged in misconduct in the case from almost its beginning and have pushed to have the case dismissed to no avail. But when political enemy Coleman on Feb. 2 filed his own swore statement saying he believed Hart has engaged in misconduct the prosecutorial misconduct allegation exploded anew leading Walker to hold Thursday’s hearing to probe the relationship between Hart and Coleman. For its part, the attorney general’s office claims that Coleman has been a so-called “confidential informant” in the case. The designation the state contends explains why Hart and Coleman were in contact so often. The state also claims that the nature of the conservations between the two men are privileged and protected from disclosure. But that argument was not a winning one at least Thursday when Walker allowed Coleman to testify over the state’s objection.More:


Donald Trump taps Sen. Jeff Sessions to lead campaign’s National Security Advisory Committee

Alabama Sen. Jeff Sessions will lead Republican presidential front runner Donald Trump’s newly formed National Security Advisory Committee, the campaign announced tonight. Sessions became the first Senator to endorse Trump, announcing his support during a rally held in Huntsville last Sunday. In his new role, Sessions will advise Trump on foreign policy and homeland security issues. “It is an honor to have Jeff as a member of the team. I have such great respect for him and I look forward to working with him on the issues most important to Americans,” Trump said. Sessions, a member of the Senate Armed Services Committee, said he’s looking forward to working with Trump and military leaders in developing a “clear-eyed foreign policy rooted in the national interest.” “We need to understand the limits of our ability to intervene successfully in other nations. It is time for a healthy dose of foreign policy realism. In the Middle East, this means forming partnerships based on shared interests, not merely overthrowing regimes in the dangerous attempt to plant democracies,” Sessions said. “We must also combat the refugee crisis by creating regional safe zones, rather than depopulating the region by migration,” he added. “The only path to long-term stability and resolution of this humanitarian crisis for the United States and our European allies is to work towards the safe return of migrants to their home countries, as Mr. Trump has noted. This strategy will also protect our own national security.” Trump said Sessions has already advised his campaign on trade and immigration issues. Other members of the National Security Advisory Committee will be named in the coming weeks.


Bidding Wars Return to Birmingham, Ala.

Birmingham, Alabama’s largest city, lost more than 50,000 jobs after the 2008 real-estate crash. Fifteen years ago, at least 30 publicly traded companies were headquartered there; now there are only 12. And Jefferson County, where Birmingham resides, filed for Chapter 9 bankruptcy protection in 2011, exiting in 2013.



Morning Money

INSIDE THE ‘STOP TRUMP’ CALL — A person who was on the Our Principles PAC call on Tuesday with would-be donors to help fund ads to stop Donald Trump tells M.M. there wasn’t a massive amount of enthusiasm, given previous efforts to attack Trump failed: “They are right in that nobody has tried going negative against Trump in a sustainable way but I don’t think they really have the lay of the land. … One of the political guys started talking about getting a question planted at the SC debate about impeaching [George W. Bush] as a major success for them; not sure they understand that most GOP primary voters understand even if they don’t agree with that sentiment.

“[HP Chair Meg] Whitman was terrific, crushed [NJ Gov. Chris] Christie. My sense is they will be able to strong arm people. But at the end of the call they asked if anybody was inspired and wanted to announce a donation to gin up others there was total silence.”

GOP DEBATE WRAP — Donald Trump once again came under heavy fire — after defending the size of his manhood. He essentially admitted that he told the New York Times in an off the record discussion that he wasn’t as solid in his plan to deport 11 million undocumented immigrants as he has been on the campaign trail. He came under relentless pressure from the FOX News moderators over his claims that he can balance the budget while cutting taxes by massive amounts and not cutting entitlements.

He also took big hits for hiring immigrants over Americans at Mar-a-lago, making Trump branded clothing outside the United States and the lawsuit against his defunct “Trump University” by students who say they were left with piles of debt and nothing to show for it. Trump also struggled to name any serious foreign policy advisers or explain how he would get the U.S. military to kills the families of terrorists. Trump for the first time talked about his willingness to show “flexibility” on immigration and other policies, an obvious nod to the general election. But will that turn off supporters who hail Trump as a fire-breathing truth teller? So far, bad debate performances haven’t hurt Trump. This one probably won’t either unless it’s because his true believer followers feel like he is betraying them with moderation.

Whatever the case, Trump is not guaranteed the nomination. In fact, if he loses Ohio to John Kasich (who had a strong debate) and Florida to Marco Rubio (also on his game Thursday night) Trump’s path to getting 1,237 delegates before the convention in July gets fairly difficult. Even if he beats Rubio in Florida (and he currently leads in the polls) but loses Ohio, getting the requisite delegates before the convention would not be a slam dunk. A brokered convention in which a nominee is not selected on the first ballot is not a fantasy.

WELCOME TO JOBS DAY! — Moody’s Mark Zandi emails: “Steady as she goes. Job growth should remain near 200,000, about the pace of growth of the past 4 years. It is under appreciated how strong and consistent job growth has been during much of this economic recovery … The continued strength of the job market is also remarkably in the face of the turmoil in financial markets. I would expect some negative fallout from the turmoil, but it hasn’t shown up yet.

“At this pace of job growth, if sustained, the economy will be back to full employment by late summer. This is evident in the recent acceleration in wage growth. If average hourly earnings increase by 0.2 percent this month, as expected, year-over-year growth will be 2.5 percent. Up from 2 percent for most of the recovery. All the trend lines suggest even stronger wage growth in the months ahead”

Pantheon’s Ian Shepherdson: “The underlying trend in payroll growth probably has not changed significantly from the 228K average monthly gains recorded last year. But the average hides wide variations, some triggered by seasonal adjustment problems and others by one-time weather effects or unavoidable and random sampling error. … Under normal circumstances we’d expect a return to trend in February but our forecast for today’s number is only180K, reflecting two separate downside risks.

“First, the arrival of recognizable winter weather threatens to trigger mean reversion in the construction employment numbers. December was extraordinarily warm compared to normal, but January temperatures were only slightly elevated, so we are nervous that some of the extra 90K or so construction jobs reported in Q4, compared to the prior trend, will reverse. Second, February payrolls have in recent years tended to be under-reported and then revised up, with a median revision of 43K”

GOP CIVIL WAR — POLITICO’s Glenn Thrush and Alex Isenstadt: “On Super Tuesday, a cocky Donald Trump vanquished the Republican establishment. On Payback Thursday, the establishment mounted a serious counterattack that undercut Trump’s chances in November and pushed the party into open civil war. … A winner like Trump who enjoys a commanding lead this late in the nominating process should be transitioning to a general-election strategy against his likely opponent Hillary Clinton. Trump wants to, but he can’t.

“He tried to make that pivot this week, releasing his health care plan and defending Planned Parenthood, but was forced to battle a growing insurrection in his own ranks — led by the party’s 2012 nominee Mitt Romney, who labeled him ‘a fraud’ and ‘a phony’ who represented ‘a brand of anger that has led other nations into the abyss.’”

GOOD FRIDAY MORNING — Happy weekend everyone! Email me on and follow me on Twitter @morningmoneyben.

CLINTON’S TAX PLAN ASSESSED — POLITICO’s Brian Faler: “Her tax increases would target the nation’s wealthy [per a new] analysis of her tax plans, with the top 1 percent taking the bulk of the hit. The very top 0.1 percent of taxpayers would see their tax bills go up by $519,741 under her plans, the group said, while overall the top 1 percent would pay an additional $78,284.”

BITCOIN BLOCKCHAIN IN THE BELTWAY — POLITICO’s Colin Wilhelm: “The Digital Chamber of Commerce hosted its inaugural D.C. Blockchain Summit, with discussions of how the technology that powers Bitcoin can apply for other business uses and what regulatory and legal burdens it faces. Former JPMorgan commodities trader and current blockchain startup head Blythe Masters talked up blockchain’s use for financial markets while Rep. Dave Schweikert (R-Ariz.) led off the day by declaring fintech the greatest threat to banks.

“‘When the Lending Clubs of the world start moving their money on this using a blockchain and no longer landing in a bank at all, do you really need your community bank anymore?,’ the House Financial Services Committee member provocatively asked. Staff for the House Energy and Commerce Committee, House Financial Services Committee, CFTC, FTC, FBI, and Department of Homeland Security also attended and/or spoke, as did a host of consultant-types and financial executives. Former D.C. Mayor Adrian Fenty, now with Seattle-based law firm Perkins Coie, was also spotted in the crowd … “

BROKERS BRACE FOR NEW RULE — WSJ’s Michael Wursthorn: “Thousands of small brokerages are bracing for a tighter rule governing investments they recommend to retirement savers, a change they say will drive up compliance costs and could force them to drop middle-class clients. The idea of the regulation, which could be released this month by the Labor Department, seems unobjectionable enough — that brokers would follow a ‘fiduciary’ standard when making investment recommendations. …

“The rule’s opponents, including many in the brokerage industry, say it will increase their costs and make providing investment advice to small-balance retirement accounts less profitable. Already, anticipation of the rule is pushing some companies to scale back their business in the brokerage area. The associated compliance costs were a key motivator, among other factors, behind American International Group Inc.’s decision in January to sell its brokerage unit, AIG Advisor Group.”

APPLE LINES UP ALLIES — NYT’s Nick Wingfeld and Katie Benner: “Google, Amazon, Facebook, Microsoft and a parade of other technology companies filed a barrage of court briefs on Thursday, aiming to puncture the United States government’s legal arguments against Apple in a case that will test the limits of the authorities’ access to personal data. The extraordinary show of support for Apple from the tech companies, including many rivals, underscores how high the stakes are for the industry with the case …

“In all, around 40 companies and organizations, along with several dozen individuals, submitted more than a dozen briefs this week to the Federal District Court for the District of Central California, challenging every legal facet of the government’s case, like its free speech implications, the importance of encryption and concerns about government overreach. … In the brief on Thursday from Amazon, Microsoft and others, the tech companies said they shared the public’s outrage over the ‘heinous act of terrorism in San Bernardino, but said they were united in the view that the government’s case exceeded the boundaries of existing law and would hurt Americans’ security.”

ASIA SET FOR STRONG WEEK — Reuters: “Asian shares looked set on Friday to post their strongest week in five months as global investors returned to riskier assets after a string of positive U.S. economic data and a bounce in oil and commodity prices. The rebound could continue if the February U.S. employment report later in the session shows job gains but remains weak enough to discourage rate increases in the near term. … Chinese shares, however, failed to gain from the optimism, with the Shanghai Composite index down 0.5 percent … Investors are awaiting the start of the annual meeting of China’s parliament on Saturday, which will map out economic goals for the next five years”

IS LACK OF TRUST HURTING THE JOBS MARKET? — Bloomberg: “The declining level of trust among Americans may have contributed to reduced flexibility in the U.S. labor market over the last several decades, according to a Federal Reserve working paper. In the paper, Fed economists Raven Molloy, Christopher Smith and Riccardo Trezzi, along with University of Notre Dame professor Abigail Wozniak, identify a 10 percent to 15 percent decline in U.S. labor market fluidity — a measure that encompasses workers switching jobs and moving states as well as employers creating or cutting positions — since the early 1980s.

“In U.S. states where the share of people who said their trust in strangers fell more steeply, labor mobility registered greater declines, according to the paper. The drop in social trust ‘may have increased the cost of job search or made both parties in the hiring process more risk averse,’ it said”

POTUS Events

10:00 am || Receives the Presidential Daily Briefing
2:30 pm || Meets with Secretary of State Kerry

All times Eastern except as noted
Live stream of White House briefing at 12:30 pm

Floor Action

The Senate is out until Monday. The House is on recess until the following week.


Early Retirement Distributions and Your Taxes

Many people find it necessary to take out money early from their IRA or retirement plan. Doing so, however, can trigger an additional tax on top of the income tax you may have to pay. Here are a few key points to know about taking an early distribution:

  1. Early Withdrawals.  An early withdrawal normally means taking the money out of your retirement plan before you reach age 59½.
  2. Additional Tax. If you took an early withdrawal from a plan last year, you must report it to the IRS. You may have to pay income tax on the amount you took out. If it was an early withdrawal, you may have to pay an additional 10 percent tax.
  3. Nontaxable Withdrawals.  The additional 10 percent tax does not apply to nontaxable withdrawals. They include withdrawals of your cost to participate in the plan. Your cost includes contributions that you paid tax on before you put them into the plan.

A rollover is a type of nontaxable withdrawal. A rollover occurs when you take cash or other assets from one plan and contribute the amount to another plan. You normally have 60 days to complete a rollover to make it tax-free.

  1. Check Exceptions. There are many exceptions to the additional 10 percent tax. Some of the rules for retirement plans are different from the rules for IRAs.
  2. File Form 5329.  If you took an early withdrawal last year, you may need to file Form 5329, Additional Taxes on Qualified Plans (Including IRAs) and Other Tax-Favored Accounts, with your federal tax return. See Form 5329 and its instructions for details.
  3. Use IRS e-file. Early withdrawal rules can be complex. IRS e-file is the easiest and most accurate way to file your tax return. The tax software that you use to e-file will pick the right tax forms, do the math, and help you get the tax benefits you’re due. Seven out of 10 taxpayers qualify to use Free File, which is only available through the IRS website at

More information on this topic is available on

Each and every taxpayer has a set of fundamental rights they should be aware of when dealing with the IRS. These are your Taxpayer Bill of Rights. Explore your rights and our obligations to protect them on

Krebs Daily Briefing 3 March 2016


U.S. Snags Key ISIS Leader as Fight for Mosul Gets Underway

The capture of an Islamic State militant by commandos from the U.S. Army’s elite Delta Force didn’t just take a wanted fighter off the battlefield. It also highlighted that the battle to reconquer the pivotal city of Mosul has already begun. U.S. warplanes have been pounding Islamic State militants in and around the northern Iraqi city for months while Kurdish and Iraqi forces have sought to strangle key supply routes between Mosul and the group’s stronghold in Raqqa, Syria. The revelation Wednesday that U.S. commandos recently nabbed what the Pentagon described as a “mid-level” Islamic State operative reflects a strategic shift from what was strictly an air operation to one that includes ground combat forces, something President Barack Obama pledged not to do. The move will allow American ground forces to gather badly needed intelligence on the group in advance of the Mosul offensive. Reliable, detailed intelligence has often been lacking in the fight against the Islamic State, and commanders hope the raids by the commando force will paint a clearer picture of the militants’ networks and operations. The Pentagon refused to name the militant or provide more details about his role within the Islamic State. The raid also adds to the growing pressure on the group across northern Iraq, as the Iraqi Army begins to move into place for its eventual assault on the country’s second-largest city, which has been held by the Islamic State for nearly two years. U.S. airstrikes have hit Islamic State positions in and around the city more than 120 times over the past month, and Iraqi infantry units — along with their American military advisors — are setting up an operations center at a new staging base south of the city. More:

U.N. Security Council approves North Korea sanctions

The United Nations Security Council voted unanimously Wednesday to approve broad new sanctions against North Korea in response to its recent nuclear and missile tests. “Nearly all North Korean resources are channeled into its reckless nuclear program,” U.S. Ambassador to the U.N. Samantha Power told the council after the vote. “The government of North Korea would rather grow its nuclear program than grow its own children.” The vote on the resolution, drafted by the United States and North Korea’s number one ally, China, during the council’s first meeting of the year, was delayed after Russia sought more time to review it and suggest changes. The proposed sanctions would be the first to require North Korean cargo ships and aircraft to be inspected on their way into and out of the reclusive country. They would also prohibit small arms and other conventional weapons sales to North Korea. President Obama issued a statement hailing the resolution as a “a firm, united, and appropriate response” by the international community. “Today, the international community, speaking with one voice, has sent Pyongyang a simple message: North Korea must abandon these dangerous programs and choose a better path for its people,” Obama said. Following the Security Council vote, the U.S. Treasury Wednesday announced sanctions against four entities and 12 individuals who it said are involved in North Korea’s illegal nuclear weapons program. “Our coordinated efforts send a clear message: the global community will not tolerate North Korea’s illicit nuclear and ballistic missile activities, and there will be serious consequences until it modifies its reckless behavior,” said Treasury Secretary Jack Lew. North Korea conducted its fourth nuclear weapons test last month, claiming it tested a hydrogen bomb, and fired a long-range rocket over Japanese airspace on Feb. 7 in what was widely condemned as a test of missile technology banned by previous U.N. resolutions. “With each nuclear test and launch … North Korea improves its ability to conduct a nuclear attack on most of the countries on this council,” Power said. “It’s the only nuclear member state that routinely threatens nuclear attack on other countries, including members of this council.” More:

‘Piss poll’ in London pub lets Brits vote for the Republican they hate the most

Thanks to ringmaster Donald “Beautiful Hands” Trump, the 2016 Republican primary has been quite the circus. For those non-Americans feeling left out of the election fun, a London pub is offering a unique way to let anyone weigh in on the Republican race. The Three Stags in south London is hosting a “piss poll” for satirical British TV show The Last Leg. Since Feb. 26, three urinals in the men’s bathroom have been outfitted with giant cardboard cutouts of Ted Cruz, Donald Trump, and Marco Rubio. To cast their vote, customers simply urinate into the mouth of the candidate they hate the most. After an outcry over social media about the obvious lack of women and disabled voters, the good people at The Last Leg delivered. Votes are expected to be tallied Friday, March 4, but exit polls suggest this race is Trump’s for the taking. “Obviously Trump’s winning,” pub owner Richard Bell said, “90 percent of people, including me, pee in Trump’s mouth every time.” See photos:


Who were the Molly Maguires?


In the latter half of the 19th century, Schuylkill County, Pennsylvania, was an area rife with violence. Between 1861 and 1875, a series of violent assaults, arsons and murders was blamed on a secret society of Irish immigrants known as the Molly Maguires. The group had originally emerged in north-central Ireland in the 1840s as an offshoot of a long line of rural secret societies including the Whiteboys and Ribbonmen, who responded to miserable working conditions and evictions by tenant landlords with bloody vengeance. Faced with the prospect of starvation during the Great Potato Famine, more than a million Irish emigrated to America, where a large concentration settled in the anthracite coal region of Pennsylvania in search of work. Irish Catholics were routinely met with discrimination based on both their religion and heritage and often encountered help wanted signs with disclaimers that read, “Irish need not apply.” Accepting the most physically demanding and dangerous mining jobs, the men and their families were forced to live in overcrowded, company-owned housing, buy goods from company-owned shops and visit company-owned doctors. In many cases, workers wound up owing their employers at the end of each month. When the Civil War broke out and miners were drafted to join what they perceived to be “a rich man’s war,” they began to rebel. “Coffin notices” threatening death, allegedly penned by Molly Maguires, were delivered to mining supervisors and scabs who planned to fill their roles during strikes, and as working conditions worsened in the 1870s, the violence escalated. In all, 24 mine foremen and supervisors were assassinated. In 1873, Franklin B. Gowen, president of the Reading Railroad, hired the Pinkerton Detective Agency to infiltrate and destroy the Molly Maguires, whose union organizing became an impediment to increasing railroad profits. Using the alias James McKenna, native Irishman James McParlan spent two and a half years living alongside the coal miners, eventually gaining their trust. Despite the conflict of interest, Gowen served as the chief prosecutor during the subsequent trials. More:




New Tremors in High Finance Rattle Foundation of Postcrisis Regulations


Governments around the world have built over the last few years a vast new system of rules that would allow banking giants to fail and shield taxpayers from bailouts. Though this new regulatory architecture is eye-numbingly complex, its builders contend that it has made the financial system much safer without having to resort to measures like forcing a breakup of the largest banks. But that reassuring view has taken a beating of late. Recent turmoil in European debt markets pointed to a possible weakness in a crucial part of the new regulatory system. Shares of large banks have been under pressure, trading at valuations that indicate investors have little faith in the companies’ sprawling business models. Some mergers-and-acquisitions bankers on Wall Street are privately beginning to conclude that some of the largest banks may break up in the coming years. Then, last month, a new Federal Reserve official surprised many by declaring in his first speech on the job that the “too big to fail problem” had not been solved. The assertion was surprising because the official, Neel Kashkari, was at the Treasury Department in 2008 during the big bailouts. But having had time to survey the overhaul ushered in by the Dodd-Frank Act, he says that he believes more has to be done. “We need to act while we still remember how painful the crisis was,” Mr. Kashkari said in an interview. Those behind the financial overhaul might be forgiven for being taken aback by the skepticism. They have achieved many important goals, and there are signs that the new regulations are causing the banks to shrink and, over time, they may even break themselves up to satisfy their shareholders. The gradualism of the current overhaul has a steely edge that the banks and their lobbyists have, for the most part, not been able to resist, supporters of the new rules also point out. Still, the largest banks remain huge. More:


Police: McClendon crashed traveling at ‘high rate of speed’


Aubrey McClendon, a founder and former chief executive of Chesapeake Energy, died in a single-car crash Wednesday at age 56, a day after he was charged with conspiring to rig bids for oil and natural gas leases. McClendon crashed into an embankment while traveling at a “high rate of speed” in Oklahoma City just after 9 a.m. Wednesday morning, said Capt. Paco Balderrama of the Oklahoma City Police Department. Flames engulfed McClendon’s vehicle “immediately,” and it was burnt so badly that police could not tell if he was wearing a seatbelt, he said. “He pretty much drove straight into the wall,” Balderrama said. Police said they still needed to determine an exact cause. McClendon — a key player in the U.S. shale boom — co-founded Chesapeake in 1989 and stepped down from the company in 2013. Chesapeake is the second-largest natural gas producer in the United States. He also founded American Energy Partners, where he had served as chief executive. “Aubrey’s tremendous leadership, vision, and passion for the energy industry had an impact on the community, the country, and the world. We are tremendously proud of his legacy and will continue to work hard to live up to the unmatched standards he set for excellence and integrity,” American Energy Partners said in a statement. Chesapeake said in a statement that it is “deeply saddened by the news” and its “thoughts and prayers are with the McClendon family during this difficult time.”  McClendon had denied the antitrust charges against him. The alleged conspiracy took place between December 2007 and March 2012, Tuesday’s federal indictment said. The companies are accused of deciding who would win the bids, then giving an interest in the leases to the other company. The Justice Department did not say which other company it believes was involved in the alleged scheme. “Anyone who knows me, my business record and the industry in which I have worked for 35 years, knows that I could not be guilty of violating any antitrust laws,” McClendon said in a statement Tuesday. The Department of Justice’s antitrust division said it was “saddened” to hear about McClendon’s death and offered condolences to his family. McClendon, a Duke University graduate, was a part owner of the National Basketball Association’s Oklahoma City Thunder. The team plays its home games at Chesapeake Energy Arena. Reactions came in from the energy industry Wednesday. T. Boone Pickens of BP Capital Management called McClendon “a major player in leading the stunning energy renaissance in America” and “a true entrepreneur.” “No individual is without flaws, but his impact on American energy will be long-lasting,” Pickens said in a statement. Chesapeake said Tuesday that it did not expect to face criminal prosecution or fines related to McClendon’s charges. The company’s stock, which was already substantially higher Wednesday, briefly added to gains following news of McClendon’s death.


The Most Important Exchange of Wednesday’s SCOTUS Abortion Arguments


Wednesday’s oral arguments in Whole Woman’s Health v. Hellerstedt, probably the most important Supreme Court abortion case since 1992, centered around one key question: Does a Texas law that forces abortion clinics to meet stringent new standards—in the name of shielding “women’s health”—impose an “undue burden” on a woman’s right to terminate her pregnancy? In other words, would the law make it difficult, or maybe even impossible, for many Texas women to exercise their right to abortion? And if so, can the state wave away this issue by insisting, without much evidence, that such draconian regulations are still necessary to protect women? Seconds after Texas Solicitor General Scott Keller began to speak Wednesday morning, Justice Ruth Bader Ginsburg zeroed in on the “undue burden” question—quickly and mercilessly knocking Keller off balance and setting the tone for the rest of his nearly 40 minutes at the lectern. Ginsburg asked Keller how many women would live 100 miles or more from a clinic if the Texas law went into effect. About 25 percent, he responded—but that didn’t include the clinic in Santa Teresa, New Mexico, just over the border from El Paso. The existence of this clinic featured heavily in the 5th Circuit’s decision to uphold the Texas statute; it asserted that the law did not impose on “undue burden” on abortion-seeking El Paso women, because they could simply cross state lines for the procedure. “That’s odd that you point to the New Mexico facility,” Ginsburg said, in a clear and firm voice. New Mexico, after all, doesn’t force abortion clinics to meet the same standards that Texas would—standards which, Texas claims, are absolutely critical to protect women. “So if your argument is right,” Ginsburg continued, “then New Mexico is not an available way out for Texas, because Texas says: To protect our women, we need these things. But send them off to New Mexico,” to clinics with more lenient standards, “and that’s perfectly all right.” “Well,” Ginsburg concluded, with just a hint of pique in her voice, “If that’s all right for the women in the El Paso area, why isn’t it right for the rest of the women in Texas?”  This exchange was Keller’s first of the morning, and Ginsburg delivered a knockout punch. She very efficiently revealed the inconsistency at the heart of Texas’ argument. The state vows that its new standards—which include minimum sizes for hallways, doorways, and ventilation systems—are essential to protecting women’s health. But when confronted with the fact that these standards are so onerous and expensive that they will shutter many clinics, Texas shrugs and suggests women drive to another state without those ostensibly crucial standards. And in an impressive display of chutzpah, the state even relies on the continued existence of New Mexico’s clinics to defend the constitutionality of its own law. Over the following excruciating 40 minutes, the liberals took turns brutally hammering Keller about the true justification and motivation for Texas’ law. (Why single out abortion when other procedures, like colonoscopies, pose an exponentially higher safety risk? Is there any proof that clinics were unsafe before the enactment of the new rules?) But Ginsburg’s early colloquy stuck out as the moment when Keller lost control of his narrative. The extraordinarily skilled advocate approached the lectern with Texas swagger, loudly exaggerating his drawl and smugly dismissing concerns that the law in question might disadvantage women. By the time he limped away, his voice was quiet, his tone was melancholy, and his Texas accent had all but disappeared. The Texas law may yet survive. But Ginsburg’s questioning amply demonstrated that it is, beneath the post hoc rationalizations, constitutionally indefensible.


Zynga C.E.O. Mark Pincus Steps Down—Again


For the second time,Mark Pincus has stepped down from his role as C.E.O. of Zynga, the social-gaming company responsible for flash-in-the-pan Facebook gamesFarmVille and CityVille,and app-based games likeWords with Friends.Pincus, who was C.E.O. from the company’s founding in 2007 through 2013, took the reins again in early 2015, after Microsoft boss Don Mattrick briefly served as Zynga’s chief executive.

On Tuesday, Zynga announced that Pincus would be stepping down for the second time. Frank Gibeau, who spent 20 years at Electronic Arts before joining Zynga last year, is taking over as chief executive on March 7. Pincus will stay with the company as its executive chairman. “I put all of that in motion,” Pincus told Business Insider, referring to his 11-month second term as C.E.O. “I don’t need to win C.E.O. of the year to feel good about that.” During his second run as the company’s top executive, Picus says, Zynga has become more focused on its money-making businesses—including its lucrative poker and slot-machine games. While Zynga found success in Facebook’s early days, it has struggled to find its footing in the mobile space today. The company has, however, made some expensive acquisitions that have paid off. In 2011, Zynga bought video-game developer Newtoy for $53.3 million, and now owns the game Words with Friends. It remains, however, a tumultuous time for Zynga. The company’s huge San Francisco office space—purchased in 2012 for $228 million—isreportedly on the market. In its most recent earnings report, Zynga said its user base is actually contracting, having dropped by 1 percent last year. Its employee numbers have shrunk, by 45 percent over a three-year period ending in 2015. The company now employs 1,669 people. Still, all hope is not lost for the company. This year, Zynga is releasing 10 new games, including four mobile slots games, a sequel to its viralFarmVille game, and the highly anticipated Dawn of Titans.

The New Dream Jobs

When the National Society of High School Scholars asked 18,000 Americans, ages 15 to 29, to rank their ideal future employers, the results were curious. To nobody’s surprise, Google, Apple and Facebook appeared high on the list, but so did the Central Intelligence Agency, the Federal Bureau of Investigation and the National Security Agency. The Build-A-Bear Workshop was No. 50, just a few spots behind Lockheed Martin and JPMorgan Chase. (The New York Times came in at No. 16.) However scattershot, the survey offers a glimpse into the ambitions of the millennial generation, which already makes up more than a third of the work force. By 2020, it will make up half. Survey after survey shows that millennials want to work for companies that place a premium on employee welfare, offer flexible scheduling and, above all, bestow a sense of purpose. These priorities are well known and frequently mocked, providing grist for the oft-repeated claim that millennials are lazy, entitled job-hoppers. But it’s important to remember that this generation was shaped by a recession, an unprecedented crush of student debt and a broad decline in the credibility of all kinds of institutions. Stability is an abstract concept to these young workers, so they instead tend to focus on creating a rich, textured life now, rather than planning for a future obscured by uncertainty. How these desires map onto companies like Google and Facebook is clear, given their strong roots in philanthropy and innovation. But the high ranking of national-security employers also speaks, just as clearly, to millennials’ hope to make a difference in the world.

Companies that want to attract the best young workers are already finding that they need to accommodate these wishes. The question is whether, when millennials are running things, they will abandon these priorities as youthful indiscretions — or establish them as the norm. Maybe one day, even the N.S.A. will have nap pods.


The Trouble with Trump for Bankers


WASHINGTON — In almost any other election cycle, bankers would be celebrating the fact that a Republican candidate has emerged so far in front of the pack and would quickly fall in line behind him. But this has been anything but a normal election cycle, and there are a whole host of reasons that bankers will be at least as reluctant to embrace the outspoken businessman Donald Trump as the Republican establishment has been. Here’s why:  1. Trump is not committed to regulatory relief, Dodd-Frank repeal — or any other bank priority. While most of the Republican candidates in the race have avoided discussing Wall Street reform or the financial crisis, almost every one at some point endorsed a repeal of the Dodd-Frank Act and pledged regulatory relief for community banks. (Sen. Marco Rubio, R-Fla., was the first, doing so during the initial Republican debate in August.) Trump, in contrast, has said almost nothing about Dodd-Frank beyond describing it as a “terrible law.” In an interview last year with The Hill, Trump vaguely endorsed repealing the law, but he has also said “there are aspects of it you could leave.” And he hasn’t called for regulatory relief for smaller institutions — a position that even former Secretary of State Hillary Clinton, the likely Democratic nominee, has espoused. If bankers are looking for someone to implement their agenda, there’s scant evidence to suggest Trump would do so. “One of the worst things for the financial industry is uncertainty. And with Donald Trump, there is tons of uncertainty regarding his economic plan,” said Jaret Seiberg, an analyst with Guggenheim Securities. “We just don’t know what his views are.” 2. When in doubt, Trump goes populist — and that would inevitably be bad for bankers.

Throughout the race, Trump has embraced populist positions, even when that meant touting unrealistic and discriminatory plans, like the border wall and deportation. He revels in picking bogeymen — lots of them. In this election cycle alone, Trump has gone after Mexicans, Muslims, journalists, Apple and Nabisco (the maker of Oreos). How long before he goes after banks?

While Trump has steered clear of anti-Wall Street rhetoric so far, in a race against Clinton, he’s likely to drift in that direction. Sen. Bernie Sanders, D-Vt., has shown how vulnerable Clinton is on Wall Street issues, and in a general election Trump is almost certain to use that to his advantage.

While breaking up the big banks may be a bridge too far, Wall Street remains deeply unpopular with the public. Many remain angry about the bailouts — and Trump has proven a master at tapping into public anger. Whatever his personal views might be about banks, it’s an easy card to play against Clinton.

“The rhetoric against Clinton will be very heated — it will be very anti-Wall Street,” said Brian Gardner, an analyst with Keefe, Bruyette & Woods. “He’s never going to get to the level of Sanders, but he runs an anti-establishment campaign. He will paint her as the ultimate insider with the titans of Wall Street and the people who brought you the financial crisis.” 3. Trump pursues vendettas — you want him overseeing the SEC or CFPB? Whether as a candidate or president, Trump is unlikely to deal well with any banker opposition to his plans (whatever they end up being). Throughout his career, Trump has shown a willingness to mock, belittle and embarrass his opponents and critics (including bankers) and there’s no reason to assume he would cease doing so if he won the White House. He has even called for rewriting libel laws so the government could more easily pursue actions against journalists. That could leave bankers in a challenging situation if Trump pursues anti-bank policies. Those who dare to speak out against him (and, for that matter, those who cover them) risk being publicly and personally attacked — if not subjected to vindictive, selective enforcement actions. Many bankers already privately admit that they dislike Trump, viewing him as a dangerous demagogue who doesn’t believe in true conservative principles, but do not wish to say so on the record for fear of drawing his ire. If bankers end up going against a Trump administration, they could find themselves in a no-win scenario. “Trump has deep insecurities that show when he responds to criticism,” Gardner said. “He doesn’t take it well. He’s thin-skinned.” More”


After Super Tuesday, it’s clear that only Hillary Clinton can stop Donald Trump


Donald Trump’s ongoing evisceration of the Republican Party establishment has earned him a reputation in some circles as a Teflon-coated magician, a politician whose mind meld with the American people is so strong it makes him immune to attack. He’s not. Of course, liberals should not be complacent about Trump’s ability to win a general election. Winning a primary is harder than winning a general, and anyone who’s secured either major party’s nomination is just a bit of good luck away from taking the White House. But the antidote to complacency is not panic. The fact is that Trump has triumphed in Republican Party primaries because the Republican Party is incapable of mounting effective resistance to him, not because effective resistance is impossible. Their strategies have failed because highlighting his real weaknesses would put them on ground that is too uncomfortable given the ideological rigidity of the GOP structure and the biases of rank-and-file Republicans. But the plain, obvious truth is that Trump is running a racist campaign based on an unimpressive record in business and bad public policy ideas. Yet the pathologies of the Republican Party make it impossible for them to mount this argument in an effective way. That’s why to stop Trump, his opponent is going to have to be a Democrat — realistically, Hillary Clinton.


6 New Jersey Papers Call On Christie To Resign Over Trump Endorsement


In a joint editorial published on Tuesday, six New Jersey newspapers called on New Jersey Gov. Chris Christie to resign, citing his decision to endorse Donald Trump after dropping out of the presidential race.

“We’re disgusted with his endorsement of Donald Trump after he spent months on the campaign trail trashing him, calling him unqualified by temperament and experience to be president,” the editorial from six Gannett-owned papers reads. “And we’re fed up with his continuing travel out of state on New Jersey’s dime, stumping for Trump, after finally abandoning his own presidential campaign,” the papers continued in the editorial. “For the good of the state, it’s time for Christie to do his long-neglected constituents a favor and resign as governor. If he refuses, citizens should initiate a recall effort.”

The New Hampshire Union Leader was also dismayed by Christie’s endorsement of Trump. The paper initially endorsed Christie in the Republican presidential race, but publisher Joseph McQuaid wrote in a Monday editorial that the paper was wrong to back the New Jersey governor. “Watching Christie kiss the Donald’s ring this weekend—and make excuses for the man Christie himself had said was unfit for the presidency—demonstrated how wrong we were,” McQuaid wrote. “Rather than standing up to the bully, Christie bent his knee. In doing so, he rejected the very principles of his campaign that attracted our support.”

Presidential hopefuls stretch the truth talking about campaign finance

The financing of candidates’ campaigns has become a central theme of the primaries, although — aside from Trump’s truth-adjacent claims that he is self-financing his bid — Republicans mention the topic significantly less often than do Democrats. We offer this analysis of the veracity of statements by various candidates aiming for the White House. See analysis of candidates funding at link below:

‘How to move to Canada’ trending after Trump win

Searches asking ‘How to move to Canada’ are spiking on Google as U.S. voters digest Donald Trump’s sweeping win in the Super Tuesday Republican primary vote. NBC declared Trump a clear winner on Tuesday night after the real estate mogul claimed victories in seven states including Virginia, Alabama, Georgia and Vermont, beating other Republican presidential nominees including Ted Cruz and Marco Rubio. And it seems to have sparked a renewed interest in packing up for a life north of the border. A quick Google search of ‘How to move to Canada’ brings up results including the country’s main immigration page, working abroad programs and an 8-step wiki guide for how to make the move.

But this isn’t the first time that Trump’s candidacy has sent eyes towards the Great White North.

Earlier this year, a tongue-in-cheek tourism campaign for Cape Breton Island — situated just off the coast of Maine -— attempted to lure Americans by waxing lyrical about Canada’s liberal laws around religious diversity, abortion laws and affordable housing. “Don’t wait until Donald Trump is elected president to find somewhere else to live! Start now, that way, on election day, you just hop on a bus to start your new life in Cape Breton,” it read. The website’s creator has since written on the contact page that his team has been overwhelmed by interest, adding that they welcome everyone, regardless of their political affiliation.

But whether a mass exodus to Canada would potentially create a rift between the North American neighbors is unclear. While Trump told local reporters back in September that he “loves Canada” and opposed building a wall at the Canadian border — countering a much-ridiculed idea put forward during Scott Walker’s campaign for the Republican nomination —- the admiration might not be mutual.

When asked on social media whether he would stand up to Trump and his “hateful rhetoric,” newly elected Canadian Prime Minister Justin Trudeau told a town hall run by Canada’s Maclean’s magazine in December that he would respect voters’ decisions, but stopped short of supporting Trump’s tactics.

“It’s going to be important…to be able to have a positive relationship with whoever Americans choose as their president,” Trudeau said. “I don’t think it comes as a surprise to anyone that I stand firmly against the politics of division, the politics of fear, the politics of intolerance or hateful rhetoric. If we allow politicians to succeed by scaring people, we don’t actually end up any safer. Fear doesn’t make us safer. It makes us weaker,” the prime minister added.|politics|link|030216|11AM|move-to-canada




Alabama Black Belt Adventures Association Celebrates Relationship with RSA

Montgomery, AL -( Hundreds of hunters, anglers and lovers of the outdoors have chosen Alabama as a vacation destination thanks to the partnership shared by the Retirement Systems of Alabama and Dr. David G. Bronner and the Alabama Black Belt Adventures Association. Ads running on Raycom Media, one of RSA’s successful investments with television stations across the nation, and newspapers owned by Community Newspaper Holdings, Inc., are attracting tourists to the Black Belt region. “Since 2013, visits to the Black Belt Adventures’ website have almost doubled with more than 60,000 outdoor enthusiasts learning about our region’s recreational assets. We attribute RSA’s donated media placements as a major factor to this success,” said Thomas Harris, founder and chairman of ALBBAA. “From the website, people from all over the country find perfect hunting and fishing grounds and spots for great outdoors’ vacations. It’s because Dr. Bronner and the RSA invested in TV and newspapers that the Alabama Black Belt is able to tell its story on a national stage, from New York to Honolulu.” To date, the number of inquiries by potential visitors to the region is approaching 3,000. Nearly one-third of respondents to recent ALBBAA inquiries said that these television advertisements and newspaper ads inspired them to seek more information on – and to visit – Alabama’s Black Belt for hunting and fishing trips and other adventures. During this basketball season, Atlantic Coast Conference fans in millions of homes across the nation have felt the tug of the great Alabama outdoors as they watched their favorite teams and, during timeouts, heard legends Ray Scott and Jackie Bushman extol the virtues of the many outdoor adventures available in the Black Belt. 


Ala. House committee approves ETF, teacher pay raise


An education budget with money to hire more teachers and give most educators a four percent pay raise passed an Alabama House committee Wednesday morning. The $6.3 billion 2017 Education Trust Fund budget proposal passed on a unanimous voice vote, as did a separate bill authorizing the pay raise despite a debate over pushing it higher. But other features of the budget – including increases for textbooks, transportation, school supplies and money for daily expenses for school districts – swayed legislators. “I think this bill illustrates why we should have an enormous amount of optimism for the state of Alabama,” said House Ways and Means Education chairman Bill Poole, R-Tuscaloosa. “I believe this evidences a priority by the Legislature and this committee to invest our precious resources where they are so important.” Poole said the budget could be on the floor of the House next week. The ETF goes into effect Oct. 1. The budget provides a four percent raise for K-12 education employees making $75,000 a year or less. Teachers making over that amount would get a two percent raise. Employees of the two-year college system would all get a four percent raise. The proposal also includes funding to hire 475 new teachers in grades seven through 12. The state lost about 3,000 public school teachers between 2008 and 2015, falling from 49,364 to 46,480. It also provides an additional $29.3 million for Other Current Expenses (OCE), money given to districts usually spent on daily needs. Poole said there would be an additional $7 million for transportation needs; $1.6 million for classroom supplies and $5 million for technology needs. The state’s acclaimed but limited voluntary pre-kindergarten program would see a $14 million increase, from about $48 million to $62 million, which could extend the program to an additional 2,700 four-year-olds, about 25 percent of those who may qualify. The increase represents a step down from Gov. Robert Bentley’s proposed $20 million increase – which could extend pre-K to 3,800 four-year-olds, and advocates asked to see the governor’s number restored. Jim Page, president of the Chamber of Commerce of West Alabama, said the ongoing investments in pre-kindergarten would particularly benefit low-income children and reduce the need for law enforcement and criminal justice service in the long run.

“The research is clear and the math is simple,” he said. “We can invest in high-quality pre-K now and give more children a greater chance to achieve their God-given potential. Or we can pay much more later.”

The size of the pay raise also came into question. Susan Kennedy of the Alabama Education Association said teachers were grateful for the raise, but said inflation and increased costs had eaten away at salaries. Kennedy also expressed concerns about the Public Education Employee Health Insurance Program (PEEHIP), which in December projected a shortfall of $140.4 million for fiscal year 2017, raising rates to the point that it would eat up any raise. House Minority Leader Craig Ford, D-Gadsden, echoed that concern, saying PEEHIP could “come down and backdoor us and take four percent of their pocket.”

Committee Democrats pushed to increase the pay raise to five percent but did not succeed.

“Support for another one percent (raise) for teachers is a no-brainer for me,” said Rep. Patricia Todd, D-Birmingham. “We are already underpaying our teachers.” The ETF funds PEEHIP’s $21 million budget request; Poole said rising health costs were “a concern for every citizen in our country right now.” The chairman also said after the committee meeting he wanted to address as many educational needs as possible with the funding at his disposal. “You have to strike a reasonable balance,” he said. “We have a finite amount of resources. It’s important to the taxpayers of Alabama that we put those resources in areas where they have the most impact, and impact as many of those areas as we can.” More:


10 funny things Barack Obama said (including Auburn joke) when Alabama visited White House

The latest Alabama trip to the White House East Room ran a few minutes behind schedule. When it began Wednesday afternoon, President Barack Obama had a few one-liners prepared. Being the fourth such trip made in his presidency, Obama made that a theme. “I guess for a lot of folks,” he said, “it’s welcome back.” The traditional welcomes included Alabama governor Robert Bentley and other dignitaries packed into the room. Obama praised the Crimson Tide’s work ethic and mentioned a previous meeting with Derrick Henry at the National Prayer Breakfast. Obama was touched by the Heisman Trophy winner saying his prayer for all the people who could not eat breakfast that day. Obama also noted the 16th Habitat for Humanity house that’ll be built in Tuscaloosa to honor the latest championship. In the middle of a politically charged week, Obama made the room laugh a few times during his nearly seven-minute speech. Here are a few of the highlights with a tag-team joke with Nick Saban at the end.– “My first question is, coach, what took you so long? It’s been three whole years since I last saw you.” — “Of course, a lot of recognition goes to somebody who’s in the running to be the greatest college football coach of all time, Coach Nick Saban.” (Not exactly funny, but notable) — “This is the fourth time I’ve hosted Alabama here at the White House. So clearly, I brought you some good luck.” — “You can call me ‘O-bama,” the president said as the room laughed. “You like that?” — “The last time a team went on this kind of run was in the 1940s. Back then, folks were still wearing leather helmets. I don’t feel like anybody in a leather helmet would do too well to trying to tackle Derrick Henry. Even with regular helmets, they didn’t do too well.” — “… Linebacker Reggie Ragland, who returned for his senior year to make good on a pledge he made to his momma that he’d get a degree. Just because he’s big does not mean he’s not scared of his momma.” — “… a surprise fourth-quarter onside kick. That was one of the few times you saw Coach Saban smile on the sidelines.” — “I know the people of Alabama are extraordinarily proud of this team, maybe the Auburn fans don’t want to admit it, but everyone recognizes excellence when they see it and nobody’s had more sustained excellence as a program at the collegiate level than the Alabama Crimson Tide.” — “I’d like to say I’ll see you next year, but we have this thing called term limits. So you can keep on going.” — Saban: “Our captains would like to present you again.” Obama: “I have a lot of these jerseys.”


Senator Says Ethics Bill Not Related to Hubbard Case


MONTGOMERY—A firestorm swept through the State after columnist John Archibald revealed that a proposed reform bill would gut existing State ethics laws. “It has begun. The systematic dismantling of the ethics law. It was bound to happen, when the seat of power became a hot seat. It was practically guaranteed,” wrote Archibald. The bill was widely seen as an attempt to give indicted Speaker of the House, Mike Hubbard, a reasonable doubt argument at his up coming trial on 23 felony counts of public corruption. However, the bill’s sponsor, State Sen. Gerald Dial (R-Lineville), in an interview with, refuted that notion saying, “As to the intent of this bill being misconstrued as an attempt to effect current or ongoing cases, that is simply not the case.” Dial further stated, “I respect our judicial process and trust those who perform those duties to comply with laws already passed by our legislative process, proposed bills would never be retroactive and to imply that proposed legislation would cause benefit or harm any case is simply untrue.” The bill, filed as SB279, was given to Dial by Senate President Pro Tem Del Marsh (R-Anniston), who asked that he, Dial, sponsor the bill. The proposed changes were prepared by the Legislative Reference Services (LFO). Interim Director Othni Lathram respond to our request for the name of the person who asked for the bill to be drafted but saying, “SB279 was prepared by the Legislative Reference Service and Section 29-7-6 requires that all requests and related materials be maintained as confidential unless waived by the Legislator who made the request.” Which lawmaker asked LFO to prepare the bill is still unknown, but Dial said he met with Ethics Chief Tom Albritton on two occasions to discuss the details of the bill. In an earlier interview, Dial said he was working with Albritton to make sure the Ethics Commission approved any changes to the State’s ethics laws. Marsh and Albritton have close ties with the indicted Speaker. Marsh was Republican Party Finance Director when Hubbard was party chair. During that period, over a million dollars in party donations were funneled from ALGOP into Hubbard owned business interests, which Marsh would have needed to approve. Albritton has a long standing personal and professional relationship to Hubbard’s wife’s family, and he is still listed as a law partner with Mrs. Hubbard’s sister. The timing of SB279, and the “behind the curtain” players, has cast a long shadow over the bills origin and intent. More:

The Hubbard secret tapes: Confidential ‘source’ or ‘informant’

In a conversation secretly recorded in early 2014, Assistant Attorney General Matt Hart told political consultant Baron Coleman this:  “You are a confidential source for us. That’s what you are. You would be classified under the federal system as a confidential source, not an informant but a confidential source.” But last month in a court filing in Lee County in the on-going criminal case against House Speaker Mike Hubbard, the AG’s office claimed that Coleman had acted as a “confidential informant” in the Hubbard case since the fall of 2012, not as a confidential source as Hart had told Coleman over a year before. What does it matter? The answer to that question may start to be answered Thursday with the next hearing in the biggest public corruption case the state has seen since the convictions of former governors Guy Hunt in 1992 and Don Siegelman a decade ago. While it is Hubbard who has been indicted on 23 charges of using his office for financial benefit, the case right now may hang on the nature of the relationship between Hart and Coleman. And that relationship may hinge on whether Coleman was actually a “confidential informant” and not a source. The distinction could affect whether conversations between Hart and Coleman are considered legally confidential and privileged. Until a month ago Coleman had been one of Hubbard’s most vocal opponents using a radio show he host in Montgomery to hammer Hubbard and in 2014 as a political operative running the campaign of Hubbard’s opponent in the 2014 Republican primary. That seemed to all change a month ago when Coleman, in a sworn statement, said he had engaged in countless conversations with Hart dating back to 2012. Coleman in his affidavit said that at some point in their relationship he “concluded” that Hart was leaking secret grand jury testimony in the Hubbard investigation. Coleman said he used that information to run a “whisper campaign” against Hubbard in his 2014 re-election bid. Hart and the AG’s office shot back in their court filing that the Coleman affidavit was no more than “a desperate last minute attempt” by Hubbard’s legal team to avoid trial, slated at the end of this month. More:

Committee Passes Resolutions Opposing Gambling and Medicaid Expansion

On Saturday, February 27, the Alabama Republican Party State Executive Committee met for their annual winter meeting. The Committee passed several resolutions. Resolution No 2016-04 urges Alabama Governor Robert Bentley (R) and members of the legislature, to oppose the expansion of Medicaid under the Affordable Care Act, and states that the Alabama Republican Party is fully committed to repealing Obamacare. A committee appointed by the Governor had recommended accepting President Barack H. Obama’s offer to expand the costly entitlement program to include poor singles, but the Governor himself never made any recommendation. The legislature is facing yet another State General Fund (SGF) budget crisis, and the existing Medicaid program is already, by far, the greatest drain on the SGF budget. Under the original Patient Protection and Affordable Care Act of 2010, the states were commanded by the then Democratic controlled Congress to expand their Medicaid programs to include non-disabled poor adults. Alabama and two dozen other states sued. While Obamacare survived the court challenge the US Supreme Court did strike down the language making the Medicaid expansion mandatory. States were free to choose to expand Medicaid or not. Alabama Governor Robert Bentley refused the expansion of the costly joint federal and state program in Alabama. Resolution No. 2016-08 calls for all Republican members of the State Senate and House to oppose all bills which expand gambling. State Senator Jim McClendon (R-Springville) and State Representative Allen Harper (R-Northport) have sponsored legislation that would allow the people to vote yes or no on whether or not they want a lottery. State Senator Trip Pittman (R-Montrose) also has sponsored a lottery bill. In 2015 Senate President Del Marsh (R-Anniston) had sponsored complex legislation that would have created a state lottery, authorized four dog tracks to add gaming, and allowed the Poarch Creek Indians to offer table gambling in their bingo casinos in exchange for paying taxes on the Indian gambling. That bill went nowhere and Sen. Marsh did not bring it back in 2016. The Alabama Republican Party State Executive Committee also passed resolutions urging the Alabama State Legislature to support am Article V Convention of States; announcing that the Alabama Republican Party supports party registration; urging that all remaining gun free zones be eliminated; calling for all Republican members of the State Senate and House to oppose all bills which increase taxes; calling for the Approval of a Bill to Prohibit Abortion Clinics Within 2,000 feet of any Alabama Public or Private School in the State of Alabama; asking the Alabama Congressional delegation to pursue impeachment charges against Federal Judge Ginny Granade and Federal Judge Myron Thompson for improperly exceeding their authority regarding the state laws of Alabama; and applauding US Senator Richard Shelby, US Senator Jeff Sessions, Congressman Bradley Byrne, Congressman Mo Brooks, Congressman Gary Palmer, Congressman Mike Rogers and Congresswoman Martha Roby for opposing the federal spending Omnibus bill.



Chris Christie is now ruined

Since New Jersey Gov. Chris Christie has endorsed Donald Trump, he has been:

  • Humiliated by video showing Trump ordering him onto the plane and telling him to “go home.”
  • Condemned by his former finance co-chair Meg Whitman. (“The Governor is mistaken if he believes he can now count on my support, and I call on Christie’s donors and supporters to reject the Governor and Donald Trump outright. I believe they will. For some of us, principle and country still matter.”)
  • Excoriated for his disastrous TV interview on Sunday. Phrases like “train wreck,” “off the rails” and “disaster” were used to describe his appearance.

In other words, if it had not been obvious to him before this weekend, his political career is essentially over. He has gone from someone admired for his political talent to the object of derision as an errand boy for someone who espouses fascistic ideas (e.g., punishing the press) and openly displays his bigotry (e.g., retweeting a Mussolini quote). Christie is now signed up with the man who the Anti-Defamation League on Sunday was compelled to call out for pretending initially not to know who David Duke is:  The Anti-Defamation League (ADL) is providing information on extremists and hate groups to all of the presidential candidates, including Donald Trump, who earlier today in an interview with CNN’s Jake Tapper indicated he did not know anything about notorious former Klansman and racist hatemonger David Duke. Last week, Duke endorsed Trump’s candidacy for president. “David Duke is a notorious anti-Semite and racist and his name is synonymous with bigotry,” said Jonathan A. Greenblatt, ADL’s CEO. “Duke is a perennial candidate for elected office and perhaps America’s best known racist and anti-Semite. He is a former Imperial Wizard of the Knights of the Ku Klux Klan. His message is racist, anti-Semitic, and anti-American to its very core, and he’s clearly exploiting Mr. Trump’s candidacy to get publicity for himself and his hateful ideas.” . . .“The last thing we want is for white supremacists to use this campaign to mainstream their bigotry,” Mr. Greenblatt said. “It is imperative for elected leaders and political candidates like Mr. Trump and others in the public eye to disavow haters such as Duke and the other white supremacists who have endorsed his candidacy. By not disavowing their racism and hatred, Trump gives them and their views a degree of legitimacy. Even if it is unintentional on his part, he allows them to feel that they are reaching mainstream America with their message of intolerance.” Christie perhaps fancied himself as Trump’s VP or attorney general. If he did, he was not thinking clearly. To begin with, it is less and less likely with each passing day that Trump will ever become president. Moreover, Christie himself has so soiled his reputation that it is doubtful he would ever be confirmed for a Cabinet post. And with his awful Sunday interview, Trump will undoubtedly look for a different running mate if it gets to that. Trump has rendered Christie an isolated, pathetic object of scorn. Other Republicans should take note.

Trump Tremendously Relieved That K.K.K. Ties Did Not Hurt Him in Alabama

MOBILE, ALABAMA (The Borowitz Report)—The Republican front-runner, Donald Trump, said on Tuesday night that he was “tremendously relieved” that the recent controversy linking him to the Ku Klux Klan had apparently not hurt him with voters in Alabama. “I’m not a worrier by nature, but I must admit I was worried about this,” Trump told reporters. “The minute that that K.K.K. business started up, my main fear was, ‘I sure hope this doesn’t upset voters in Alabama.’ ” After the Alabama returns came in showing him romping to an easy victory in the Yellowhammer State, Trump said, “I sighed a huge sigh of relief.” Trump pointed to exit polls showing that ninety-seven per cent of Alabamans who voted for him were aware that he had been praised by the former K.K.K. leader David Duke “and voted for me anyway.” “The fact that they knew I was endorsed by the K.K.K. but were able to look beyond it says something great about them,” he said. “I guess I was worried about nothing.”

Donald Trump’s nomination isn’t inevitable (although it sure looks that way)

Well, here we are. Donald Trump had a big day yesterday. He won seven of the 11 Super Tuesday contests, leading my former boss and elder GOP wise man Ed Rollins to declare that “Trump is now unstoppable” and has “totally dominated a political cycle like no other politician” in decades. Trump is not articulate, he doesn’t have any fresh ideas, he’s the opposite of thoughtful and he doesn’t possess any compelling logic or clear thinking. All Trump has going for him is a lot of votes — and in politics, that can mean a lot. If the anti-Trump forces want a ray of hope, the good news is that although Trump has secured 316 delegates so far, the rest of the GOP candidates combined have 372 delegates. I’m choosing to believe that Trump is not yet inevitable. A lot of GOP regulars are struggling with how to be anti-Trump but pro-Republican. What are good, solid GOP senators who are up for reelection in swing states going to do if Trump is at the top of the ticket? The challenge would be obvious: Republicans sharing the ballot with the Donald need 100 percent of the Trump vote to win, but if they embrace him, do they risk losing suburban mainstream voters who find Trump repulsive? Will reliable conservatives rally to the anti-Hillary Clinton candidate even if it is Trump, or will they stay home in November? Is it realistic to think that ticket-splitters would turn out in sufficient numbers to save incumbent GOP senators if there is a Trump-induced downdraft? Anyway, when I talk to Republicans, I don’t really sense panic so much as feel they are somewhat shellshocked. Republicans seem paralyzed, muttering to themselves and shaking their heads. And while we’re at it, the pitiful picture of New Jersey Gov. Chris Christie, a former presidential candidate, standing behind Trump last night will serve as a chilling reality check for anyone who might be considering serving as Trump’s vice president. Vice-presidential nominees don’t drive many votes, and they often fall out of favor, but the Trump VP could completely skip the brief, exciting honeymoon phase immediately after his or her announcement and instantly become the subject of ridicule. The media’s scrutiny of Trump’s VP nominee will undoubtedly be shaped to prove the foregone conclusion that the VP nominee is a hapless, pitiful sycophant. There is no possibility that Trump has the skills or, for that matter, the predisposition to be credible promoting the notion that his VP is a full partner on the ticket or would be particularly influential as vice president. I don’t see how you could be Trump’s vice-presidential nominee and not instantly become a punch line. I pity the poor soul already. It’s not over until it’s over. But the trajectory is clear. Nobody has to decide now, but it looks as though every Republican should start thinking about how he or she will deal with the choice between Donald Trump and Hillary Clinton in November. (Ed Rogers is a contributor to the PostPartisan blog, a political consultant and a veteran of the White House and several national campaigns. He is the chairman of the lobbying and communications firm BGR Group, which he founded with former Mississippi Gov. Haley Barbour in 1991.)

Hubbard case reeks all the way to Alabama governor’s office

Let me make my feelings clear. Just so you know my prejudices up front. I wouldn’t trust Alabama Gov. Robert Bentley farther than I could throw him. Who he is today is not who he was yesterday and only God and his top advisor know who he might become tomorrow. And I don’t trust that advisor – Rebekah Caldwell Mason, who is paid with shadowy money from who knows where – farther than Bentley himself could throw her. Her very word sends shivers through state employees. Because they believe she is the de facto governor, that her word has become Alabama law. And we don’t even know who pays her. Those are my biases. Those are my beliefs. So take the rest with whatever grain of salt you think it deserves. I believe that right now, on the eve of the most critical hearing in the corruption case of Alabama House Speaker Mike Hubbard, everything that can be done to destroy that case is being done. No surprise there. I believe the governor and Mason do not want that trial to proceed. I believe the governor, who has long been considered a willing witness against Hubbard (after all the speaker is charged among other things with criminal lobbying of the governor) now sees the witness stand as a trap. He fears what defense lawyers will ask him. Which means he has something to hide. I believe the governor improperly interjected himself in the case when he ordered the Alabama Law Enforcement Agency not to cooperate after the Attorney General’s office sought affidavits from ALEA that could mitigate Hubbard defense claims of prosecutorial misconduct. And I do not believe in coincidences. On Feb. 16 a number of ALEA officials were called to a meeting in the governor’s office and rebuked for signing affidavits that said there was no ongoing investigation of prosecutor Matt Hart. People in the room describe both Mason and the governor as “furious,” despite the fact that the affidavits were innocuous and truthful. The anger, ostensibly, came because Bentley did not want to appear to be involved in the case. Of five ALEA representatives in that meeting, all have since been fired, placed on leave or transferred. ALEA Director Spencer Collier was there. He was publicly slapped on the wrist for disobeying orders – even though the governor has no business telling law enforcement to not tell the truth. Collier was put on medical leave and quickly replaced. Collier’s chief of staff, Hal Taylor, was there. He was transfered this week. Collier’s No. 2, J.T. Jenkins was in the meeting as well. He was fired this week too, along with three other people loyal to Collier. They were handed letters thanking them for their fine service on the way out the door. Special Agent Jack Wilson was not only there, he signed his own affidavit in the Hubbard case. He was moved to Mobile and told to leave his corruption cases behind. Collier’s executive council, Jason Swann, was bumped back down to a staff position. Then, this week, the state leaked word suggesting that Collier and the others were punished after an investigation revealed a misappropriation of funds at ALEA. First, let me say that if there has been misappropriation and misspending at ALEA, root it out. Put the feds and the AG on the case and find every speck of corruption or waste. Turn the place upside down and shake it. Sweep up all the dirt in the trash. And from what I hear, acting director Stan Stabler is a guy who can do it. But I believe it’s a diversion. It is too fast. Too convenient. I believe, on the eve of a critical Mike Hubbard hearing, there is more here than meets the eye. I believe laws have been broken. And I believe in my heart and soul that the FBI needs to examine Alabama and this whole process with the thickest magnifying glass they have. Alabama, at this point, cannot be trusted to police itself.

Morning Money

WALL STREET HOPES TO NUKE TRUMP — POLITICO’s Ben White — “Wall Street is getting ready to go nuclear on Donald Trump. … Terrified that the reality TV star could run away with the Republican nomination and bring his brand of anti-immigrant, protectionist populism to the White House, some top financiers are writing big checks to fund an effort to deny Trump a majority of delegates to the GOP convention. The effort is centered on the recently formed Our Principles PAC, the latest big money group airing anti-Trump ads, being run Katie Packer, a GOP strategist and deputy campaign manager in 2012 for Mitt Romney.

“The group, initially funded by $3 million from Marlene Ricketts, wife of billionaire T.D. Ameritrade founder J. Joe Ricketts, wants to saturate the expensive Florida airwaves ahead of the March 15th primary in the state with hopes of denying Trump a victory there that could crush the hopes of home-state Senator Marco Rubio. A conference call on Tuesday to solicit donors for the group included Paul Singer, the billionaire founder of hedge fund Elliott Management, Hewlett Packard President and CEO Meg Whitman and Chicago Cubs co-owner Todd Ricketts, who is Marlene Ricketts’ son. Wealthy Illinois businessman Richard Uihlein is also expected to help fund the effort.

BIG MONEY FROM SINGER — “One person close to the Our Principles PAC said money will not be an issue. This person said Singer, who is worth close to $2 billion, is fully dedicated to making sure the group has all the funds it needs to inundate the airwaves in Florida and other states not viewed as entirely friendly to Trump, a group that includes Illinois, Missouri, Arizona, Wisconsin and other states in the Northeast and West. Ohio could join the list if Trump moves ahead of the state’s governor, John Kasich, in the polls.

“‘The money is not going to be a problem. We will raise what we need to do what we need to do,’ the person close to the new anti-Trump PAC said. ‘Yes there are people who are skeptical but there are just as many ready to write big checks. The question is only whether Trump truly is really Teflon.’ The theory, this person said, is that voters are still largely unaware of the full case against Trump. ‘We have not seen how he holds up to real sustained attacks over the KKK and David Duke stuff, over Trump University, over Trump Mortgage. People don’t really know about that stuff. We are about to find out what happens when they find out about it.’”

EARLY JOBS DAY PREVIEW — Beth Ann Bovino, Chief U.S. Economist for S&P: “We expect the economy added 195,000 jobs in February, a nice bump from the 151,000 gain in January, but still below last year’s solid monthly average of 228,000. … For the Fed, we expect the jobs report will reassure them that their decision to initiate lift off in December was the right one. But, it won’t likely give them reason to move again in March.”

SHELBY ROLLS — Compass Point’s Isaac Boltansky: “Senate Banking Committee Chair Richard Shelby cruised to victory with nearly 65 percent of the vote in the primary for his seat … thereby avoiding what would have been an expensive and difficult run-off race. Notably, the work of the Senate Banking Committee has effectively been on hold as Senator Shelby has been campaigning so his victory suggests that the committee’s public schedule will resume shortly. We remain pessimistic regarding the prospects of passage for major legislation in the Senate Banking Committee in 2016 but with Senator Shelby’s primary now finished we expect to see movement on financial nominees to the SEC and possibly the Federal Reserve Board”

WHAT WOULD TRUMP MEAN FOR BANKS? — Guggenheim’s Jaret Seiberg: “As we see it, the risk with Trump is a lack of certainty. There is simply no detail on what he thinks of the financial system and what he would want to do to big banks. Our view of Trump has always been that he is a pragmatist at heart. That would suggest a positive environment for banks as Trump may cut through red tape to boost lending in order to ensure the economy keeps growing.

“What concerns us is that Trump has been a populist in the campaign. He has not directly attacked the biggest banks, but it is easy to imagine him decrying too big to fail and vowing to force the biggest banks to restructure. When it comes to a Treasury secretary, it is unclear to us whom he could pick. … That could open the door for a maverick such as Federal Reserve Bank of Minneapolis President Neel Kashkari”

MORE JOBS DAY PREP — Mohamed A. El-Erian on Bloomberg View: “A figure of 150,000 or more added jobs would consolidate an impressive two-and-a-half-year run in employment creation … This impressive growth in jobs has generally not translated to meaningfully higher wages, at least until now. The jobs report for January, released last month, suggested that this may be changing. Confirmation of this improvement, along with a gradual recovery in the labor participation rate, is essential”

IS TRUMP MUCH LESS RICH THAN HE CLAIMS? — FORTUNE’s Sean Tully: “On two occasions, this writer has spent weeks striving to demystify the Vatican’s finances. Now I’m attempting to solve the riddle of Donald Trump’s income and net worth. … Here’s the most concerning thing I learned: Trump appears to have overstated his income, by a lot, which could be the reason he has so far tried to avoid releasing his returns”

McCLENDON DIES AFTER INDICTMENT — WSJ’s Bradley Olson, Ryan Dezember and Erin Ailworth: “Aubrey McClendon, an Oklahoma wildcatter who helped pioneer the shale energy boom, died in a fiery car crash Wednesday, a day after he was indicted by a federal grand jury on charges of conspiring to rig the price of oil and gas leases. Mr. McClendon propelled the rebirth of U.S. energy production as the co-founder of Chesapeake Energy Corp., leading a rush to lease land around the country to extract natural gas and oil trapped in shale rock formations through a technique made famous by its nickname, fracking. …

“His extreme risk-taking made him a billionaire at one time. It also caused him personal and professional financial hardships that spurred activist investors, including Carl Icahn, to oust him as Chesapeake’s chief executive in 2013. Oklahoma City police said Wednesday that Mr. McClendon was found dead after driving into a concrete wall around 9 a.m. at a speed well above the 40-mph hour limit for the area. He was alone in the car. Mr. McClendon was survived by his wife, Katie, and three children. He was 56. Authorities were trying to determine whether the crash was the cause of death, or whether a health problem had figured in the accident. Police said it would take one to two weeks to complete their investigation”

BANK BREAK-UPS AHEAD? — NYT’s Peter Eavis: “Governments around the world have built over the last few years a vast new system of rules that would allow banking giants to fail and shield taxpayers from bailouts. Though this new regulatory architecture is eye-numbingly complex, its builders contend that it has made the financial system much safer without having to resort to measures like forcing a breakup of the largest banks.

“But that reassuring view has taken a beating of late. Recent turmoil in European debt markets pointed to a possible weakness in a crucial part of the new regulatory system. Shares of large banks have been under pressure, trading at valuations that indicate investors have little faith in the companies’ sprawling business models. Some mergers-and-acquisitions bankers on Wall Street are privately beginning to conclude that some of the largest banks may break up in the coming years”

FOREIGN POLICY EXPERTS RIP TRUMP — FT’s Demetri Sevastopulo in Miami and Geoff Dyer in Washington: “Several dozen prominent Republican foreign policy experts … issued a harsh attack on Donald Trump as the property developer closes in on the party’s presidential nomination. The critique [was] published in the form of a letter whose signatories include Robert Zoellick, the former deputy secretary of state who has been advising Jeb Bush. Others who have put their name to the letter include Dov Zakheim, a former top Pentagon official who with Mr Zoellick advised George W Bush on foreign policy in his 2000 presidential campaign, and Peter Feaver, now at Duke University, who worked at the White House under George W Bush and Bill Clinton.

“As well as his controversial views on immigration and hostility to trade deals, many members of the foreign policy community fear that a Trump administration would damage relations with allies such as Japan, South Korea and Germany. They also fear that he is too sympathetic towards authoritarian rivals of the US, such as Russian leader Vladimir Putin.”

KOCH BROTHERS WON’T HIT TRUMP — Reuters: “The Koch brothers, the most powerful conservative mega donors in the United States, will not use their $400 million political arsenal to try to block Republican front-runner Donald Trump’s path to the presidential nomination … The decision by the billionaire industrialists is another setback to Republican establishment efforts to derail the New York real estate mogul’s bid for the White House, and follows speculation the Kochs would soon launch a ‘Trump Intervention.’ ‘We have no plans to get involved in the primary,’ said James Davis, spokesman for Freedom Partners, the Koch brothers’ political umbrella group. He would not elaborate on what the brothers’ strategy would be for the Nov. 8 election to succeed Democratic President Barack Obama.

“Three sources close to the Kochs said the brothers made the decision because they were concerned that spending millions of dollars attacking Trump would be money wasted, since they had not yet seen any attack on Trump stick. The Koch brothers are also smarting from the millions of dollars they pumped into the failed 2012 Republican presidential bids of Newt Gingrich and Mitt Romney, the sources said.”

MORE WARNING SIGNS FROM CHINA — Bloomberg: “Obscured by the focus on the accuracy of China’s growth figures is a tumble in estimates for the economy without adjusting for inflation — a slide that gives a clearer picture of why the country’s slowdown has stoked rising concern about its debt burden. Gross domestic product in dollars, unadjusted for price changes, rose just 4.25 percent in the fourth quarter of 2015 compared with the same period of 2014 — a gain of $439 billion. Just two years before, China added $1.1 trillion to the global economy, expanding 13 percent from a year earlier”


FIRST LOOK: THE PRODUCTIVITY SLOWDOWN — BLS is out with the final Q4 productivity numbers. Preliminary stats showed a steep plunge at the end of 2015, continuing a lackluster, decade-long trend. New Third Way report looks at a full range of economic theories behind the slowdown

SAMPSON EXTENDED AT PCI — Insurance insiders say the Board of the Property Casualty Insurers Association of America (PCI) has extended CEO David Sampson’s contract through 2021 (an additional 5 years). Sampson previously served as Deputy Secretary of the U.S. Department of Commerce.

HILLARY AND BLACKROCK — The Intercept’s David Dayen “Goldman Sachs paid Hillary Clinton $675,000 for three speeches, but an even bigger Wall Street player stands ready to mold and enact her economic and financial policy if she becomes president. BlackRock is far from a household name, but it is the largest asset management firm in the world, controlling $4.6 trillion in investor funds … And Larry Fink, BlackRock’s CEO, has assembled a veritable shadow government full of former Treasury Department officials at his company.

“Fink has made clear his desire to become Treasury Secretary someday. The Obama administration had him on the short list to replace Timothy Geithner. When that didn’t materialize, he pulled several members of prior Treasury Departments into high-level positions at the firm, which may improve the prospects of realizing his dream in a future Clinton administration.”

POTUS Events

10:45 am || Departs White House
11:50 am CT || Arrives Milwaukee
1:50 pm CT || Delivers remarks on Obamacare; Milwaukee
2:45 pm CT || Departs Milwaukee
5:40 pm || Arrives White House

All times Eastern except as noted

Floor Action

House meets at 9 a.m. with first votes expected between 10 a.m. and 11 a.m. Last votes expected between 10:45 a.m. and 11:45 a.m. Senate back at 9:30 a.m.


FDIC Announces Webinar for National Consumer Protection Week 2016:
Cybersecurity Resources for Financial Institution Customers


Summary: The FDIC’s Division of Depositor and Consumer Protection (DCP) and Division of Risk Management Supervision (RMS) will host a free webinar on March 9, 2016, from 2:00 p.m. to 3:00 p.m. (EST), titled Cybersecurity Resources to Help Your Customers Protect Themselves. The webinar, held in conjunction with National Consumer Protection Week, will highlight new and enhanced consumer education resources available from FDIC that encourage financial institution customers (consumers and businesses) to take appropriate safety precautions for using computers and the Internet. Institution use of these resources is optional and not a regulatory requirement.

Statement of Applicability to Institutions Under $1 Billion in Total Assets: This Financial Institution Letter applies to all FDIC-supervised institutions.

FDIC-Supervised Banks (Commercial and Savings)

Complete Financial Institution Letter:

What is the Additional Medicare Tax and Who Pays It?


Some taxpayers may be required to pay an Additional Medicare Tax if their income exceeds certain limits. Here are some things that you should know about this tax:

  • Tax Rate.  The Additional Medicare Tax rate is 0.9 percent.
  • Income Subject to Tax.  The tax applies to the amount of certain income that is more than a threshold amount. The types of income include your Medicare wages, self-employment income and railroad retirement (RRTA) compensation. See the instructions for Form 8959, Additional Medicare Tax, for more on these rules.
  • Threshold Amount.  You base your threshold amount on your filing status. If you are married and file a joint return, you must combine your spouse’s wages, compensation or self-employment income with yours. Use the combined total to determine if your income exceeds your threshold. The threshold amounts are:
Filing Status Threshold Amount
Married filing jointly $250,000
Married filing separately $125,000
Single $200,000
Head of household $200,000
Qualifying widow(er) with dependent child $200,000
  • Withholding/Estimated Tax. Employers must withhold this tax from your wages or compensation when they pay you more than $200,000 in a calendar year. If you are self-employed you should include this tax when you figure your estimated tax liability.
  • Underpayment of Estimated Tax.  If you had too little tax withheld, or did not pay enough estimated tax, you may owe an estimated tax penalty. For more on this, see Publication 505, Tax Withholding and Estimated Tax.

If you owe this tax, file Form 8959, with your tax return. You also report any Additional Medicare Tax withheld by your employer on Form 8959. Visit for more on this topic. You can also get forms and publications on anytime.

Each and every taxpayer set of fundamental rights they should be aware of when dealing with the IRS.  These are your Taxpayer Bill of Rights. Explore your rights and our obligations to protect them on

Krebs Daily Briefing 2 March 2016

Thomas L. Krebs, Securities Litigation, Regulation and Compliance Attorney Lawyer (c)2014 Brandon L. Blankenship
Thomas L. Krebs


Hamas Commander, Accused of Theft and Gay Sex, Is Killed by His Own

GAZA CITY — The death of Mahmoud Ishtiwi had all the trappings of a telenovela: sex, torture and embezzlement in Gaza’s most venerated and secretive institution, the armed wing of Hamas. Mr. Ishtiwi, 34, was a commander from a storied family of Hamas loyalists who, during the 2014 war with Israel, was responsible for 1,000 fighters and a network of attack tunnels. Last month, his former comrades executed him with three bullets to the chest. Adding a layer of scandal to the story, he was accused of moral turpitude, by which Hamas meant homosexuality. And there were whispers that he had carved the word “zulum” — wronged — into his body in a desperate kind of last testament. His death has become the talk of the town in the conservative quarters ofGaza, the Palestinian coastal territory, endlessly discussed in living rooms, at checkpoints and in cabs. But to astute Gaza observers, this was more substantive than a soap opera. Mr. Ishtiwi, who is survived by two wives and three children, was not the first member of Hamas’s armed wing, the Izzedine al-Qassam Brigades, to be killed by his own. What was unprecedented was the way his relatives spoke out publicly about it. The family was considered Hamas royalty for having sheltered leaders wanted by Israel, including Mohammed Deif, the Qassam commander in chief lionized by Palestinians. Mr. Ishtiwi’s mother even sent Mr. Deif, who has lost an eye and limbs but has survived repeated assassination attempts by Israel, a tearful video message in which she entreated him to release her son. Ibrahim al-Madhoun, a writer close to Hamas, the Islamist group that controls Gaza, said the situation spotlighted shifts since Yehya Sinwar was elected in 2012 to represent Qassam in Hamas’s political wing, a role akin to defense minister. Mr. Sinwar’s actions, he said, showed that even senior figures were not sacrosanct. “He is harsher than other leaders — he wants his army to be pure,” Mr. Madhoun said in an interview. “Those who are in the Qassam are the most important people in Gaza. There is a need, they say, to show that these people are not untouchable.”

Metallurgical company CEO arrested for exports to Iran: U.S. Justice Department

The chief executive officer of an international metallurgical company has been arrested on charges of illegally exporting aerospace-grade metals to Iran, the U.S. Justice Department said on Tuesday. Erdal Kuyumcu, 44, of Woodside, New York, was to make his initial court appearance in New York on Tuesday afternoon, the Justice Department said in a news release.  The complaint alleges that Kuyumcu, a U.S. citizen and the CEO of Global Metallurgy LLC, twice exported a cobalt-nickel powder used in aerospace, missile production and nuclear applications. Exporting the metallic powder to Iran without a license from the U.S. Treasury Department is illegal, the news release said.

Iran’s Diplomatic Dance on Syria

TEHRAN — As a partial cease-fire between the Syrian government and some rebel groups began Saturday, Iranian authorities expressed support for the agreement. But they also sounded a note of skepticism about its chances of success, arguing that the agreement protects an array of armed groups that Tehran considers to be terrorist organizations. The United States and Russia spearheaded the cessation of hostilities between the government of Syrian President Bashar al-Assad and rebel groups. The agreement allows both sides to continue fighting terrorist groups such as the Islamic State and the al Qaeda-affiliated al-Nusra Front. “Iran supports the cessation of hostilities,” Hamid Reza Dehghani, who heads the Middle East Department for Iran’s Ministry of Foreign Affairs, told Foreign Policy in an interview. “But in practice there will be problems. There is no common definition of terrorist groups.” The Iranians, Russians, and Assad’s government apply the terrorist label to a much larger number of groups than the United States, including groups such as Ahrar al-Sham, Jaish al-Islam, and others that fight alongside al-Nusra Front and U.S.-backed rebels. Washington and Moscow hope the cessation of hostilities can lay the basis for future peace talks. As the partial cease-fire entered its fourth day, the agreement had clearly resulted in a reduction of violence — but there were signs that the cessation of hostilities was fraying in certain areas. Syrian opposition groups accused Russian jets of launching 26 airstrikes on rebels covered by the cease-fire, while Russian military officials blamed Turkey for facilitating an Islamic State attack on a Kurdish-held town in northern Syria. “By and large the cessation of hostilities is holding, even though we have experienced some incidents,” U.N. Secretary-General Ban Ki-moon said on Monday. More:

Molotovs and Death Threats: Russian Debt Collectors Go Medieval

On the night of Jan. 27, a Molotov cocktail crashed through the window of a house in the central Russian city of Ulyanovsk, badly burning a toddler. Prosecutors charged a 44-year-old man with the firebombing, saying he had threatened the child’s grandfather over past-due payments on a 4,000-ruble ($51) loan. The accused, a former police officer, has denied the charges. As Russia’s economy falters, its citizens are sinking deeper into debt—and bill collectors are going after them with vehemence. In recent months, collection agents have been charged with assaulting debtors, vandalizing their cars, even destroying baby carriages parked outside apartments. A kindergarten in southern Russia was evacuated in December after a caller threatened to attack the building unless an employee paid a debt owed by her husband. In another case, Anton and Anna Byskup, who live in Novosibirsk, say that unidentified collectors in January sent e-mails to their friends and relatives with a fake obituary of their baby daughter and put Anna’s photo and telephone number on a website advertising prostitutes’ services. The couple say they fell behind on repaying a short-term 15,000-ruble loan from a high-interest payday lender. “I was shaking, I had a nervous breakdown,” Anna said in a TV interview. More:


Millennials, security concerns drive financial firms to text communications

Millennials have sometimes been called the texting generation, and a new study indicates their habits may be having a growing effect on how financial firms communicate. Driven by competitive pressure to reach the younger consumers as well as security trends, such as two-factor authentication, financial firms are increasingly adding enterprise-level texting programs as part of their communications platforms. Eighty percent of financial services companies are currently using or planing to use global SMS texting with their customers or employees, according to a study released Wednesday by research firm IDC. In addition, 88 percent of financial services organizations believe that mobile messaging has a considerable or major impact on customer experience. “There is lot of interest from financial services firms in attracting and retaining millennials and millennials tend to not want their notifications as voice calls or messages. They tend to not respond on that channel as well,” said Tim Fujita-Yuhas, director of product management at OpenMarket, which commissioned the IDC study. OpenMarket is a division of Amdocs focused on enterprise mobile solutions. While reaching millennials has been one driver for text communication programs, a security-related trend that has also seen strong growth is demand for two-factor authentication. When customers log into a secure website or access personal account information, firms are increasingly texting them a one-time code to use as a second factor in addition to their user name and password. “Financial firms, as part of the increased security awareness around all the breaches and cyberattacks that have been happening, have picked up their game in terms of rolling out two-factor authentication using mobile messaging,” Fujita-Yuhas said. The IDC study found a range of enterprise-level use cases for texting, with IT alerts about system status or network outages as the most popular; followed by emergency alerts to employees; customer surveys; and customer alerts, updates and notifications. Two factor authentication falls into the fourth category, Fujita-Yuhas said. Meanwhile, a separate study, released in May, showed that customers who receive texts increasingly expect them to be interactive. Financial firms led other industries in attempted texts to toll-free numbers, with 231,805 attempted message inquiries sent to the largest North American financial services organizations, according to the May study by Open Markets and ZipWhip. This consumer behavior has prompted some financial services firms to begin to inquire about text-enabling their toll free numbers, their land lines or even their interactive voice response systems (IVRs). The use cases vary, but at this point financial firms inquiring about enterprise text messaging tend to be looking to solve individual pain points, Fujita-Yuhas says, rather than trying to achieve a wide-scale communications transformation. “Most clients aren’t looking to buy the entire platform from day one. It’s more individual use cases, but quickly they begin to think to themselves I could use this for two or three other related areas,” he said.

Stock Exchange Prices Grow So Convoluted Even Traders Are Confused, Study Finds

Computer-driven American stock markets have become so complex that at any moment in time more than 800 different pricing possibilities are being offered to trading firms across 12 official exchanges, according to new research attempting to explain the tangled system. The report was prepared by the Royal Bank of Canada, one of the most outspoken critics of the computer-driven American stock market. It will be released to clients this week in advance of a Senate hearing on Thursday that will examine how the structure became so convoluted and what might be done to improve it. The complexity is a result, in part, of the constant jockeying among exchanges to win business from the biggest traders, many of which are so-called high-frequency trading firms that make money by capitalizing on small changes in prices.

RBC Capital Markets, the division of the bank which led the research, found that the New York Stock Exchange, Nasdaq and other exchanges make frequent small tweaks to their prices, influencing trading behavior in ways that are hard for even sophisticated investors to understand. Some of the big mutual fund companies that buy and sell stocks on behalf of investors said that before seeing the RBC research even they had not realized how convoluted the system had become. “The level of complexity has grown to such an extent that it is unknown to most market participants,” said Mehmet Kinak, the head of electronic trading at T. Rowe Price Group, and a client of RBC with which the research has already been shared. “Instead of finding natural buyers and sellers, we’re finding intermediaries who come in and are benefiting from the complexity.” At one exchange highlighted in the research, EDGX, the pricing tiers, for example, include the “Investor Tier,” the “Ultra Tier,” the “Mega-Step-Up Tier 1” and the “Mega-Step-Up Tier 2,” among others. These tiers, though, are just the first layer of complication that big investors have to navigate to determine the price of what would seem to be a rather simple act: buying or selling a stock.


A Taunt From Dimon That Wells Fargo Would Be Reckless to Heed

It sounds as if Jamie Dimon has been brushing up on his Sun Tzu. Mr. Dimon, the chief executive and chairman of JPMorgan Chase, appears to be goading one of his biggest rivals into the perilous terrain of global investment banking. He suggested in an interview with Bloomberg News that if Wells Fargo wanted to compete internationally, it would have to buy a Wall Street franchise. That would recklessly push the otherwise boring Wells Fargo, led by John G. Stumpf, deeper into businesses it does not know well. Wells Fargo, based in San Francisco, has a generally narrower focus on home buyers and corporate borrowers in the United States, which appeals to investors these days. Simplicity has trumped sprawl and riskier operations like bond trading since the financial crisis. JPMorgan trades at 90 percent of its expected 2016 book value, according to estimates culled by Reuters Eikon, but the larger Wells Fargo fetches a multiple of 1.3 times. Mr. Dimon gives the impression that he is both impressed by and fearful of Wells Fargo’s slow and steady rise in corporate finance. Though it is not top five in any broad market category, Mr. Stumpf’s bank claimed 2.5 percent of the industry’s global fees last year, as tallied by Thomson Reuters. That’s a far cry from JPMorgan’s leading 6.9 percent, but it put Wells Fargo ahead of the likes of UBS and Lazard, mainly on the back of selling bonds and syndicating loans for clients. Notwithstanding concerns from regulators, there would probably be some willing sellers of investment banking operations. Barclays, Credit Suisse and Deutsche Bank are struggling to develop profitable strategies in the new capital-intensive world order. Mr. Dimon may be theoretically correct in saying that top clients operate globally, and that Wells Fargo could chase them across oceans with an acquisition leveraging its corporate relationships and lower cost of capital.

Lawmakers Urge Greater Care With Sales of Distressed Mortgages

Dozens of lawmakers sent a letter on Tuesday to housing regulators urging them to disqualify aggressive investors from the sales of distressed mortgages by the Federal Housing Administration, Fannie Mae and Freddie Mac, and asking them to provide more details about loan sales and their outcomes. Hedge funds and private equity firms have drawn fire from housing advocates as they swoop in to buy distressed mortgages that remain from the housing crisis nearly a decade ago. Critics say the investors are too quick to push loans into foreclosure rather than negotiate workable modifications that could keep owners in their homes. The letter, signed by 45 lawmakers, points to the distressed-asset specialty company Lone Star Funds, based in Dallas, and its subsidiary, Caliber Home Loans, which is under investigation by the New York attorney general over mortgage-servicing practices, particularly loan modifications that revert to original payments. “Entities that pay lip service to legitimate loan modification requirements while engaging in unfair or abusive practices toward borrowers should not be able to use government programs to profit from the continuing legacy of the financial and foreclosure crisis,” said the letter, which was addressed to the Housing and Urban Development secretary, Julián Castro, and the Federal Housing Finance Agency director, Melvin L. Watt. More:

Pennsylvania grand jury finds widespread sex abuse by priests


Hundreds of children in western Pennsylvania were sexually assaulted by about 50 Roman Catholic priests over four decades while bishops covered up their actions, according to a state grand jury report released on Tuesday. The report found that former Altoona-Johnstown Diocese Bishop James Hogan, who died in 2005, and his successor, Joseph Adamec, who retired in 2011, worked to cover pedophile priests’ tracks and that some local law enforcement agencies also avoided investigating abuse allegations, said state Attorney General Kathleen Kane. “The heinous crimes these children endured are absolutely unconscionable,” Kane told reporters in unveiling the report, based on a two-year investigation. “These predators desecrated a sacred trust and preyed upon their victims in the very places where they should have felt most safe.” Revelations that some priests had habitually sexually abused children and that bishops had systematically covered up those crimes burst onto the world stage in 2002 when the Boston Globe reported widespread abuse in the Boston Archdiocese. That report, which won a Pulitzer Prize and was the subject of last year’s Academy Award-winning film “Spotlight,” set off a global wave of investigations that found similar patterns at dioceses around the world. They led to hefty lawsuits and seriously undermined the church’s moral authority. No criminal charges will be filed because the alleged incidents are too old to be prosecuted, Kane said. More:


A Blow to Health Care Transparency


The U.S. Supreme Court dealt a blow today to nascent efforts to track the quality and cost of health care, ruling that a 1974 law precludes states from requiring that every health care claim involving their residents be submitted to a massive database. The arguments were arcane, but the effect is clear: We’re a long way off from having a true picture of the country’s health care spending, especially differences in the way hospitals treat patients and doctors practice medicine. It also means that, for the time being at least, we’ll remain heavily reliant on data being released by Medicare, the federal health insurance program for the elderly and disabled, to study variations in health care. ProPublica has used Medicare data to study differences in medication prescribing, surgeons’ complication rates and use of services by doctors, but it’s still not clear that Medicare is representative of all health care in the country. The court’s decision involves a case from Vermont, one of 18 states that created so-called all-payer claims databases. Vermont’s law called for health insurers, health providers, medical facilities and government agencies to report data on health care costs, prices, quality and use of services to the state. That included employers who pay the costs of their workers’ treatments themselves, and not through an insurance contract. (Self insurance is common for large companies.) But Liberty Mutual Insurance Co. objected, saying the Employee Retirement Income Security Act of 1974, or ERISA, prevents states from imposing such a requirement on self-funded plans. The idea is that companies that have operations across the country shouldn’t be subjected to 50 different state laws, but instead should only have to abide by rules from one agency, namely the U.S. Department of Labor. The court sided with Liberty Mutual, in a 6–2 decision, ruling it did not have to submit the data demanded by Vermont. In a friend-of-the-court brief filed last September, the American Hospital Association and the Association of American Medical Colleges said that without the data from self-funded plans, all-payer claims databases will be incomplete and not as valuable as they could be. “Hospitals only have data for the patients they treat,” the groups wrote. “Information from across the spectrum of an individual’s health care experience is needed to inform clinical, payment, and public health policy…Complete data across all payers (including self-insurers like Respondent) is required so that both health care providers and policymakers can understand the variations in the health care system, and address those that need to change.” They also noted that self-insured plans cover a “large majority of the working population: in 2013, nearly 60% of workers with health insurance were enrolled in such plans, and that figure is growing.” So what now? One option is for self-insured plans like Liberty Mutual to voluntarily provide their data to state-run databases. But given the lawsuit, that appears unlikely. Another possibility, raised by Justice Stephen Breyer, is for the federal government to require self-insured plans to disclose their data. “I see no reason why the Secretary of Labor could not develop reporting requirements that satisfy the states’ needs, including some state-specific requirements, as appropriate,” he wrote.

For now, though, we may have to do what we have done for years: Settle for an incomplete picture of health care spending and utilization.

How Hackers Recruit New Talent

Sick of trawling through endless job boards and firing off résumés into the black? Thinking about turning to a life of crime, just to avoid having to put on a nice shirt and a forced smile for another interview? A career as a criminal hacker may not be the best place to escape the job-search tedium, according to new research from the cybersecurity firm Digital Shadows. Looking at about 100 million websites on both the surface web and dark web, the researchers found that the process  hackers use to recruit new hires mirrors the one most job-seekers are used to. (The interview, for example isn’t gone—it just might involve some anonymizing technology.) Just like in any other industry, hackers looking for fresh talent start by exploring their network, says Rick Holland, the vice president of strategy at Digital Shadows. “Reputation is really, really key,” Holland says, so a candidate who comes highly recommended from a trusted peer is off to a great start. When hiring criminals, reputation isn’t just about who gets the job done best: There’s an omnipresent danger that the particularly eager candidate on the other end of the line is actually an undercover FBI agent. A few well-placed references can help allay those fears. If recruiters need to advertise an opening, they have a few options. Hacker forums offer the most exposure, many of them are password-protected, and users generally choose pseudonyms. But they still carry risks—anyone who logs in without somehow anonymizing their web traffic can be traced relatively easily. Holland says his company asks domain hosts to take down forums if they come across a specific threat to one of their clients—like a post that offers a reward for extracting data from a company’s private server—but some domains don’t respond. More:

Court rejects Trump’s bid to throw out Trump University case


An appeals court denied a request from Donald Trump to dump a New York fraud lawsuit against Trump University today, taking the $40 million case against the presidential front runner a step closer to the courtroom. The suit, brought by state Attorney General Eric Schneiderman, alleges that Trump University “intentionally misled” thousands of people across the country with its pitch for the business mogul’s real estate courses. Schneiderman sued in 2013 for money to repay former students. “We look forward to demonstrating in a court of law that Donald Trump and his sham for-profit college defrauded more than 5,000 consumers out of millions of dollars,” Schneiderman said in a statement. Trump University drew in students with a free seminar that was mostly a sales pitch for expensive Trump University coursework, the lawsuit alleges. And through Trump claimed instructors were “all people that are handpicked,” almost none of the speakers at Trump University seminars had ever met Donald Trump, the suit alleges.

Trump’s lawyers tried to argue that the case should not be tried because the allegations fell under a three-year statute of limitations, but the court decided that there is a six-year statute on the case.

Another lawsuit against Trump University, a class-action in federal court in San Diego with similar allegations, could head to trial later this year.


Supreme Court to hear arguments on Texas abortion-clinics case


The Supreme Court will hear arguments Wednesday in its most important abortion case in a generation, considering how far states may go in regulating the practice before violating a woman’s constitutional rights. The review of a Texas law with regulations similar to those in other states thrusts the court into one of the country’s most divisive moral and political controversies. The divide over protecting the unborn and safeguarding the right of a woman to choose is among the starkest differences between Republican and Democratic candidates. Numerous states have enacted restrictions that lawmakers say protect a woman’s health but that abortion providers contend are merely a pretext for making it more difficult to obtain an abortion — or even making the procedure unavailable within a state’s borders. The challenged provisions of the Texas law require that abortion facilities meet the standards required of surgical centers and say doctors who perform abortions at clinics have admitting privileges at a nearby hospital. The justices are applying a test the court formulated nearly 25 years ago in Planned Parenthood v. Casey . It said states had a legitimate interest in regulating abortion procedures but could not make them so onerous as to impose an “undue burden” on a woman’s right to terminate a pregnancy before fetal viability. Included in the description of such a burden was “unnecessary health regulations that have the purpose or effect of presenting a substantial obstacle to a woman seeking an abortion.” Both sides are convinced that one justice is pivotal to the outcome: Anthony M. Kennedy. He, along with retired Justices Sandra Day O’Connor and David H. Souter, wrote what became the controlling opinion in Casey.  The case is being heard by an eight-justice court because of the unexpected death of Justice Antonin Scalia, who was one of the court’s most outspoken opponents of the idea that the Constitution protects a right to abortion.


Outsider Fervor Spills Into Congressional Republican Battles

The outsider wave boosting Republican presidential front-runner Donald Trump is now washing into Republican congressional primaries, where a collection of influential GOP incumbents face the prospect of being pushed into runoffs. The antiestablishment fervor poses its most immediate threat to four-term Alabama Republican Sen. Richard Shelby, who is in a four-way primary on Tuesday. Another Republican whose Tuesday primary is being closely watched is House Ways and Means Committee Chairman Kevin Brady of Texas, who this year has drawn three challengers. Much of the attention is focused on Mr. Shelby, an 81-year-old who has worked his way up to the powerful Senate Banking Committee chairmanship while using his perch on the Senate Appropriations Committee to secure funding for programs important to his state. He has spent years amassing a war chest that totaled $16.7 million based on a report filed earlier this month, and lately hasn’t been shy about spending it. His biggest threat is 33-year-old Jonathan McConnell, an Iraq war veteran who runs a maritime security company. Mr. McConnell predicts that he will be able to keep Mr. Shelby’s support low enough to trigger a runoff on April 12. So far in his race, Mr. Shelby has plowed $5.5 million into ads on broadcast television networks, more than any other Senate candidate, according to Elizabeth Wilner, a senior vice president at Kantar Media Ad Intelligence, which tracks ad purchases. The campaign arm of the Senate Republicans, the National Republican Senatorial Committee, has also deployed staffers to Alabama to help support Mr. Shelby, who has been crisscrossing Alabama to highlight his work for the state. Mr. Shelby’s ads promise to protect “good conservative Alabama values” and say he has stood up to President Barack Obama on issues like illegal immigration and the federal health law. A recent ad featured the father of a serviceman who died in Afghanistan and whose burial at Arlington National Cemetery Mr. Shelby helped secure. He “looks out for us every single day,” the father says. The senator’s name is also emblazoned on billboards around the state, assuring voters that he will safeguard Alabama’s conservative values. Brent Buchanan, a Republican strategist in Montgomery, said he believed Mr. Shelby “is going to do fine.” But he said a key question hangs over the primaries in Alabama, where the ballot features the presidential candidates and delegates on the front and Senate and House races on the back: “Do the Trump voters turn the ballot over and take their angst out on federal incumbents? Or do they vote for the Donald and go home?” More:


Chris Christie’s wordless screaming


I believe that Donald Trump was talking, tonight, and that he, in fact, held an entire press conference. But it was impossible to hear him over Chris Christie’s eyes. Chris Christie spent the entire speech screaming wordlessly. I have never seen someone scream so loudly without using his mouth before. It would have been remarkable if it had not been so terrifying. Sometimes, at night, do you still hear them, Clarice? The screaming of the Christies? His were the eyes of a man who has gazed into the abyss, and the abyss gazed back, and then he endorsed the abyss. It was not a thousand-yard stare. That would understate the vast and impenetrable distance it encompassed. He looked as if he had seen a ghost and the ghost had made him watch Mufasa die again. He had the eyes of a man who has looked into the heart of light, the silence. A man who had seen the moment of his greatness flicker, and seen the eternal footman hold his coat, and snicker. And, in short, he looked afraid. He had the face of a man who has used his third wish and realized too late that “may my family never starve” could be twisted to mean that the genie should murder his entire family. He had the face of a man who has just realized his own mortality.

Look into those eyes and try to deny that Chris Christie has seen something. Someone just told Chris Christie that there is no God. Or Chris Christie has just discovered that God does exist but She is an enormous snake who hates or is indifferent to mankind. Or Chris Christie has just discovered that there is no God but that Hell is real. “When are they coming to airlift me out?” Chris Christie’s eyes are pleading. “Please tell me that they are coming and that it is soon.” But then his expression hardens. Chris Christie knows that they are not coming back for him. This is his life now. More:


Black students ejected from Trump rally in Ga.

VALDOSTA, Ga. — There are different accounts of who made the decision to eject the 30-some black students who say they were standing silently at the top of the bleachers at Donald Trump’s rally here Monday evening. Late Monday night, a Trump spokeswoman denied that the incident at Valdosta State University’s campus was initiated “at the request of the candidate” or the presidential campaign. A spokesman for the Secret Service contradicted the students’ statements that federal agents led them out of the building, saying Trump staff and local law enforcement officials were in charge of handling protesters. Valdosta Police Chief Brian Childress tried to clear up the confusion Tuesday morning, telling USA Today that he personally went to speak to the Trump campaign staff and the local law enforcement officers helping with security to confirm who ordered the students out, and to ask why. “These folks were told the leave the PE complex by the Trump detail,” Childress said. The police chief said he thinks the Trump staff made the right call – and it wasn’t a racial issue. Trump had rented the venue, so “he had the right to tell folks he didn’t want to be there that they had to leave. I’m not campaigning for anyone. That’s not what I do. But in this case, I support them,” Childress said. The sight of the students, who were visibly upset, being asked to leave the grounds created a stir at a university that was a whites-only campus until 1963. The young people said they had planned to sit in silent protest, but were escorted out by security officials before the presidential candidate began speaking. The incident was recorded on video by several rallygoers. (Some of the footage can be found herehere and here.) “We didn’t plan to do anything,” said a tearful Tahjila Davis, a 19-year-old mass media major, who was in the group of Valdosta State University students, many of whom were wearing all black, that was removed. “They said, ‘This is Trump’s property; it’s a private event.’ But I paid my tuition to be here.”


The rise of American authoritarianism


The American media, over the past year, has been trying to work out something of a mystery: Why is the Republican electorate supporting a far-right, orange-toned populist with no real political experience, who espouses extreme and often bizarre views? How has Donald Trump, seemingly out of nowhere, suddenly become so popular? What’s made Trump’s rise even more puzzling is that his support seems to cross demographic lines — education, income, age, even religiosity — that usually demarcate candidates. And whereas most Republican candidates might draw strong support from just one segment of the party base, such as Southern evangelicals or coastal moderates, Trump currently does surprisingly well from the Gulf Coast of Florida to the towns of upstate New York, and he won a resounding victory in the Nevada caucuses. Perhaps strangest of all, it wasn’t just Trump but his supporters who seemed to have come out of nowhere, suddenly expressing, in large numbers, ideas far more extreme than anything that has risen to such popularity in recent memory. In South Carolina, a CBS News exit poll found that 75 percent of Republican voters supported banning Muslims from the United States. A PPP poll found that a third of Trump voters support banning gays and lesbians from the country. Twenty percent said Lincoln shouldn’t have freed the slaves. Last September, a PhD student at the University of Massachusetts Amherst named Matthew MacWilliams realized that his dissertation research might hold the answer to not just one but all three of these mysteries. MacWilliams studies authoritarianism — not actual dictators, but rather a psychological profile of individual voters that is characterized by a desire for order and a fear of outsiders. People who score high in authoritarianism, when they feel threatened, look for strong leaders who promise to take whatever action necessary to protect them from outsiders and prevent the changes they fear. So MacWilliams naturally wondered if authoritarianism might correlate with support for Trump.

He polled a large sample of likely voters, looking for correlations between support for Trump and views that align with authoritarianism. What he found was astonishing: Not only did authoritarianism correlate, but it seemed to predict support for Trump more reliably than virtually any other indicator. He later repeated the same poll in South Carolina, shortly before the primary there, and found the same results, which he published in Vox:


How a fractured field just might block Trump and force a brokered convention

Following a strong Super Tuesday showing, Donald Trump is the far-and-away favorite to win the Republican nomination. There’s growing consensus that the best a fractured field can do to stop Trump is to win enough delegates to prevent him from clinching the nomination, forcing a contested convention. That scenario — only an option because so many candidates are still in the race — hinges on whether Trump or the rest of the candidates combined can reach the needed 1,237 delegates first. After 15 contests, including a very successful Super Tuesday for the billionaire, Trump and the rest of the field are running nearly even. What is becoming clear is that going into the convention in July, either Trump will be the Republican nominee (most likely), or no one will be. If it’s the latter, delegates would likely take part in multiple rounds of voting to select a nominee. Here’s a look at the road ahead. The next two weeks will be crucial for the Stop Trump effort. Nearly 400 delegates are up for grabs before March 14. After that day, states will no longer be required to allocate their delegates proportionally. This rule change will help the leading candidate — presumably Trump — emerge from the pack and win the nomination. Until March 14, though, the rest of the field should be able to collectively keep pace with Trump if he continues to win similar percentages of primary votes.




State investigates wrongdoing within Alabama Law Enforcement Agency

The Alabama Law Enforcement Agency has launched an internal investigation into possible criminal wrongdoing by some employees and staff related to the misappropriation of state dollars and resources. Multiple law enforcement sources speaking on condition of anonymity tell that the investigation includes questions concerning operations at ALEA including activities of ALEA Secretary Spencer Collier. Sources said the investigation has already resulted in the firing of several employees and the transfer of others to others duties. Efforts to reach Collier for comment were not successful Tuesday. Gov. Robert Bentley placed Collier on a medical leave of absence two weeks ago following Collier’s decision to disregard Bentley’s decision that ALEA should not provide a sworn statement sought by the state’s attorney general’s office related to the on-going criminal case against House Speaker Mike Hubbard. Bentley called Collier’s explanation of why he supplied an affidavit despite Bentley’s order unacceptable and replaced him with  acting state law enforcement secretary Stan Stabler. Sources tell that shortly after taking command, Stabler was approached with information by staff concerned about possible wrongdoing. At that point Stabler ordered the agency’s internal integrity unit to begin an investigation. Contacted late Tuesday for comment, ALEA released the following statement from Stabler:  “Last week, as Acting Secretary of the Alabama Law Enforcement Agency, I ordered a thorough internal review of the operations, policies and procedures at ALEA.  ALEA’s Integrity Unit, comprised of seasoned law enforcement investigators, is currently conducting the review.  We will work to complete the review as soon as possible, and will deliver any findings to the appropriate authorities if warranted.  My priority as ALEA’s Acting Secretary is to carry out the mission of the agency and ensure our law enforcement officers and support staff honorably provide service, protection and safety for all of our citizens. “Since the full implementation of ALEA on Jan. 1, 2015, our goal has been to provide a more efficient and effective service to the citizens. Effective Feb. 29, two non-merit positions and two retired state employee positions have been eliminated. We will continue to evaluate all aspects of ALEA and make adjustments as necessary to continue to streamline our agency.”

Richard Shelby wins Alabama U.S. Senate primary, avoids runoff

U.S. Sen. Richard Shelby, R-Ala., won his Republican primary race on Tuesday and garnered enough support among voters to avoid a primary election. According to preliminary results and with 99 percent of Alabama’s precinct’s reporting, Shelby was leading his closest challenger, former Marine Capt. Jonathan McConnell, 65 percent to 28 percent. The other challengers combined collected about 8 percent of the vote. At the Embassy Suites in Tuscaloosa, Shelby thanked supporters and staff. He addressed the crowd before the Associated Press called the race in his favor, and he said he was confident he would prevail without the need for a runoff. That scenario would have been triggered if Shelby did not get above the 50-percent threshold. “It’s a great night, isn’t it?” he asked a reporter as he entered the ballroom. [County-by-county vote totals and more election results] In addressing his supporters, Shelby said he wished his wife, Dr. Annette Shelby, could be with him to join the celebration, but said she had been in the hospital for about 90 days. He had visited her before coming to the party, and said she had been at his side for every other election. “I owe a lot to a lot of people, starting off with my wife,” Shelby said. Among those he singled out was his campaign manager, Tom Young, and his scheduler, Anne Caldwell. “I wanted her to make my last schedule, but not tonight,” he joked.  The senator, who spent roughly a third of his $18 million war chest on the race, said he wasn’t taking anything for granted. “We ran the race to win, there’s a lot of turmoil in politics,” he said.

Alabama school Superintendent Tommy Bice retiring

State School Superintendent Tommy Bice announced this morning that he is retiring March 31 after 39 years in public education, including more than four years as superintendent. Bice, 61, said he plans to continue his work in education in the private sector after taking a break. “There comes a time when you decide that the time is right, and that time is now,” Bice said at a news conference at his office. Bice said the state Board of Education was aware of his decision. He expects the board to discuss plans for an interim superintendent at its meeting next week as board members decide how to find a permanent replacement. Bice said he met this morning with Gov. Robert Bentley, who is president of the state BOE, about his decision. Responses to Bice’s decision by two education officials were much different. State BOE member Mary Scott Hunter of Huntsville said she was sorry to see Bice retire. “I think he’s done a wonderful job,” said Hunter, who has been on the board six years. “He’s a gifted teacher. He understands how to structure the system so that students learn and teachers teach.” Sen. Dick Brewbaker, R-Montgomery, chairman of the Senate’s Education Committee, said,it was time for new leadership, especially because of new national assessments that rank Alabama last among states in fourth grade and eighth grade math. “We need people with a fresher take who frankly are willing to look at the system in a whole new way,” Brewbaker said. Brewbaker included himself among education leaders who need to be replaced. He has previously said he will not run for the Legislature again. The superintendent said public education is improving in the state under Plan 2020, adopted during his watch. The high school graduation rate has risen to 89 percent, up from 72 percent in 2012. Bice said is hoping for a seamless transition and expects Plan 2020 to stay on track. “Regardless of who is sitting in this chair, that plan remains in place,” Bice said. “I’ve reached a place in retirement that it makes sense financially for me to retire,” Bice added. “Reaching the 89 percent graduation rate was close to the milestone that I wanted to see. So we’re at a high point in terms of some of the goals of Plan 2020. It just felt right.” After taking some time off, Bice said he will become education director of the Mike and Gillian Goodrich Foundation, based in Birmingham.

Beer to-go bill passes Alabama House of Representatives

The bill that would allow brewers to sell directly to consumers has passed the Alabama House of Representatives and is one step closer to becoming law. House Bill 176 passed Tuesday 68-17, with three abstaining from voting. It still needs to pass the Senate. If passed, the law would:

  • Allow breweries that make less than 60,000 barrels per year to directly sell up to 288 ounces of its beer per customer per day for off-premises consumption.
  • Allow breweries to deliver up to two donated kegs of its beer to a licensed charity event.
  • No longer require brewpubs to open only in historic buildings, historic districts or economically distressed areas.

Currently, breweries can only sell beer for off-premises consumption through a licensed wholesaler. Dan Roberts, Executive Director of the Alabama Brewers Guild, said he was happy and unsurprised the bill passed quickly because of the extensive research and collaboration that has gone into the bill. “I think everybody knows this isn’t something that somebody just came up with or dreamed up one day,” Roberts said. “We spent months working on this, the commission had three public hearings, visited a couple of states, the Alabama Law Institute did a lot of research on best practices.”  The bill was introduced to lawmakers last month and mirrored recommendations presented by the Alabama Alcoholic Beverage Study Commission in January.

Birmingham mayor as Hillary Clinton’s running mate? ‘An honor,’ but unlikely

In a strange twist on election day, a spokeswoman for Birmingham Mayor William Bell said Tuesday that inquiries have been made regarding his possible place on a short-list of vice presidential candidates if Hillary Clinton were nominated. Bell has no comment on the situation, spokeswoman April Odom said in a news release. “While it would be an honor for both the Mayor and Birmingham to have such an incredible vote of confidence, the Mayor is focused on the needs of the city that he loves and has dedicated his life to serving,” the statement reads. “He will continue to look out for the needs of the City in every decision he makes. This is a critical time for our country and we encourage everyone to get out and vote today.” Attempts to reach Clinton campaign officials for comment were unsuccessful. After a candidate wins his or her party’s nomination for president, a running mate is typically announced in July or August of an election year. In recent months, speculation has ramped up over who could become Clinton’s running mate if she gets the Democratic nomination. Bell has not been noted publicly as a potential candidate. A few names have come to the forefront:

Morning Money

SUPER TUESDAY: TRUMP; CLINTON DOMINATE — On the GOP side, Donald Trump won Alabama, Arkansas, Georgia, Massachusetts, Tennessee, Virginia and Vermont. Ted Cruz won his home state of Texas along with neighboring Oklahoma. Marco Rubio scored one win (his first of the campaign) in Minnesota. Cruz called for the party to rally around him as the last best hope to deny Trump the nomination. Rubio vowed to fight on with his eye on March 15th contests including in his home state of Florida.

The basic shape of the race didn’t change very much. Trump remains likely to get the nomination unless Republicans somehow pick one alternative or no one gets the 1,237 delegates needed to win the nomination leading to a brokered convention. Could the GOP go to the convention with Trump the clear delegate leader and not give him the nomination? It’s theoretically possible but it would create one gigantic mess. As of midnight Trump had 268 delegates, Cruz 142 and Rubio 78.

On the Democratic side, Hillary Clinton won Alabama, Arkansas, Georgia, Massachusetts, Virginia, Tennessee and Texas. Bernie Sanders won his home state of Vermont, Minnesota, Colorado and Oklahoma. Sanders’ wins allow him to solider on in the campaign but Clinton is once again the prohibitive front-runner and almost-certain Democratic nominee. Clinton now has 984 delegates to 347 for Sanders. Full delegate totals:

CLINTON VICTORY SPEECH: “We know we’ve got work to do. But that work, that work is not to make American great again. We have to make America whole. We have to fill in — fill in what’s been hollowed out.”

TRUMP VICTORY SPEECH: “If she hasn’t straightened it out by now, she’s not going to straighten it out in the next four years. She wants to make American whole again and I’m trying to figure out what that’s all about.”

HOT CLICK: OLIVER ON TRUMP — If you haven’t seen it, give a watch to Jon Oliver on HBO’s “Last Week Tonight” absolutely destroy Donald Trump’s claims to being a self-funded, successful truth-teller.

ICHAN ON TRUMP: WE NEED HIM — Carl Icahn to Fox Business Network: “I do believe Donald Trump is what this country needs right now.”

DIMON TO WELLS FARGO: MAKE MY DAY — Reuters BreakingViews’ Jeffery Goldfarb: “JPMorgan’s boss suggests that if his big, boring rival wants to compete internationally, it’ll have to buy an investment bank. Bulking up on Wall Street would recklessly push the lender led by John Stumpf into businesses it doesn’t know well. Dimon wouldn’t want that. Right?”

STOCKS POP ON ECON DATA — Wells Capital’s Jim Paulsen: “Many have been waiting for a major world policy official … to decisively augment economic accommodation and finally restart the bull market in stocks. However, the catalyst required by the stock market may not be policy related. Rather, it may simply be dependent on the economy. As it has throughout this recovery, we think ‘economic reacceleration’ is already likely beginning to resume the bull. …

“It may seem fairly obvious that stocks typically do better when economic growth improves, but with all the angst over policy officials, oil prices and China, perhaps it is a good reminder for stock investors not to lose focus on what really matters … … .the U.S. economy. … [G]iven the tremendous drop in commodity prices (similar to a tax cut) and the equally impressive recent drop in bond yields, the likelihood of a bounce in U.S. economic growth is good”

NO RECESSION — Via PNC: “[C]onsumers continue to power the U.S. economy at the beginning of 2016. Personal income and consumer spending both rose 0.5 percent in January; these were stronger than the consensus expectations. They were also the largest monthly increases in both measures since May 2015. After-tax income also rose 0.5 percent in January. There was a very good 0.6 percent increase in labor market income in January, thanks to job and wage gains and a longer average workweek.”

WALL STREET’S NEXT BIG SHORT: TRUMP? — Reuters’ Gertrude Chavez-Dreyfuss and David Randall: “Add the juggernaut that is Donald J. Trump to the list of what-ifs that is worrying Wall Street. A growing realization that the unpredictable New York real estate developer is in a position to win the Republican nomination and then battle Hillary Clinton for the White House in November’s election has caused some investors to sell U.S. stocks. They fear having such a wild-card president could trigger trade wars, hurt the economy and add a lot of market volatility.

“‘As the market rarely feasts on lack of predictability – Trump represents a nightmare for investors this year,’ said hedge fund manager Douglas Kass of Seabreeze Partners Management Inc, who said last week that he was adding to his existing short bet on the U.S. stock market in part because of Trump’s increasingly strong position in the race. Trump’s statements on business and Wall Street don’t neatly fit into one ideological worldview, but if anything, they are seen as isolationist in a globally connected world”

But markets seem to be pricing in no “event premium” for Trump wining the White house:

GOOD TUESDAY MORNING — Email me your thoughts on Super Tuesday to and follow me on Twitter @morningmoneyben.

DRIVING THE DAY — Super Tuesday shakeout … The Joint Economic Committee has a hearing at 2:30 p.m. on the Economic Report of the President featuring CEA Chair Jason Furman … Treasury Secretary Jack Lew this afternoon will chair a meeting of the Financial Stability Oversight Council (FSOC) … ADP Employment report at 8:15 a.m. expected to show a gain of 188K.

RUBIO GATHERS HILL BACKERS — POLITICO’s Alex Isenstadt: “Marco Rubio’s campaign has invited top supporters to a Wednesday briefing on Capitol Hill to discuss the path forward. On Tuesday afternoon, as states throughout the country were casting ballots, Rubio deputy campaign manager Rich Beeson sent an invitation to backers announcing a ‘Super Tuesday and beyond briefing’ to be held on Wednesday afternoon. In the email, Beeson writes that Rubio campaign manager Terry Sullivan and other top advisers ‘will be walking through the map and the delegate math.’ Rubio spokespeople didn’t respond to requests for comment.”

DONORS ALSO GET HAND-HOLDING — POLITICO’s Anna Palmer: “Rubio’s top campaign adviser huddled with roughly 40 bundlers and K Streeters Tuesday morning to prepare them for a difficult primary election night — as well as to brief them on the campaign’s plan for what to do next. Terry Sullivan told supporters at campaign headquarters that the Florida Republican could secure just 100 delegates from Super Tuesday states in one of the scenarios he laid out.

“Sullivan’s prediction was part of his larger detailed powerpoint presentation going through different delegate counts for March, April and May. He told attendees that it would be mathematically impossible for Donald Trump to get to 1,237 delegate votes by the end of April, according to multiple attendees. Sullivan said that Henry Barbour, a veteran Mississippi political operative, is leading Rubio’s convention delegate strategy.”

Rubio’s campaign is also asking donors to raise $400,000 before Saturday’s contests in Kansas, Louisiana, Kentucky and Maine”

HOT CLICK: TAX PLANS SIDE BY SIDE — The Tax Foundation lines up all the candidates’ tax plans and assesses their impact on revenue and growth.

NEW PAC AIMS TO STOP TRUMP — POLITICO’s Alex Isenstadt: “Hoping to stop Donald Trump’s momentum, a super PAC devoted to defeating him held a conference call with some of the Republican Party’s top donors on Tuesday evening. The call was sponsored by Our Principles PAC, an anti-Trump super PAC. Among those on the line, according to one participant, included Hewlett Packard President and CEO Meg Whitman, Chicago Cubs co-owner Todd Ricketts, and New York hedge fund manager Paul Singer.

“The Ricketts family has played a prominent role in funding the group, which is being overseen by Katie Packer, a former top aide to Mitt Romney. But the group has also won the backing of other major contributors alarmed by Trump’s rise, including broadcasting executive Stan Hubbard. Organizers, hoping to fill the super PAC’s coffers, briefed donors on the group’s progress.”

WALL STREET ROARS — WSJ’s Leslie Josephs: “Major U.S. stock indexes surged to their highest levels in nearly two months Tuesday on signs of improvement in the U.S. economy. The broad rally was led by financial and technology shares, which fell sharply earlier this year as investors fretted about collateral damage from weak global growth, slumping corporate profits and low oil prices. A handful of data across several sectors helped restore some confidence in the U.S. economy Tuesday, analysts and investors said. A gauge of the troubled manufacturing sector rose last month to its best reading since September, U.S. auto sales climbed and U.S. construction spending rose in January. A rally in oil prices added to the updraft”

TRUMP UNIV. LAWSUIT GOES AHEAD — NYT’s Rick Rojas: “A New York appeals court decided on Tuesday that a lawsuit brought by the state attorney general claiming that Donald J. Trump’s defunct for-profit school defrauded consumers can go forward. The attorney general, Eric T. Schneiderman, filed the lawsuit in 2013 asserting that Trump University, later known as the Trump Entrepreneur Initiative, misrepresented itself and bilked students individually of thousands of dollars and collectively of $40 million. A panel of justices from the State Supreme Court’s Appellate Division ruled in Manhattan against dismissing the lawsuit.

“The justices found that Mr. Schneiderman was authorized to pursue the case and disagreed with the claim raised by Mr. Trump’s lawyers that the statute of limitations for the claim had run out. In a statement on Tuesday, Mr. Schneiderman, a Democrat, hailed the decision as a ‘clear victory in our effort to hold Donald Trump and Trump University accountable for defrauding thousands of students.’”

CAR SALES KEEP CRANKING — FT’s Robert Wright: “US car sales continued to run at record rates in February, defying fears of a slowing US economy and forecasts that demand must plateau after a record 17.5m new vehicles were sold in 2015. Sales for Ford, the number two US carmaker by sales, were up 20.2 per cent on February last year, while Fiat Chrysler, the US number four, achieved an increase of 12 per cent. General Motors, the market leader, said its sales were up 6.6 per cent on the same month in 2015, while Toyota, the market number three, grew its sales 5.2 per cent”


NEW MUNI BOND CAUCUS — Per release: “U.S. Representative Randy Hultgren (IL-14) and Dutch Ruppersberger (MD-02) announced the creation of the Municipal Finance Caucus to fight for state and local governments’ ability to independently finance projects to keep their communities strong. … The purpose of the Municipal Finance Caucus is to act as a forum to discuss the opportunities and challenges for states and local governments to independently fund initiatives”

POTUS Events

10:00 am || Receives the Presidential Daily Briefing
12:10 am || Participates in an Ambassador Credentialing Ceremony
3:10 pm || Honors the 2015- 2016 College Football Playoff National Champion Alabama Crimson Tide; East Room

All times Eastern
Live stream of White House briefing at 12:30 pm

Floor Action

House votes between 1 p.m. and 2 p.m., and 5 p.m. and 6 p.m. The Senate returns at 9:30 a.m.

Announcements has ACA resources for individuals and families

The Affordable Care Act, also known as the health care law, includes health insurance coverage and financial assistance options for individuals and families.

Visit for information about the tax benefits and responsibilities for individuals and families. This includes resources covering the individual shared responsibility provision and premium tax credit. It also provides basic information about how health insurance choices you make may affect the tax return you file.

IRS electronic publications include:

Online Interactive tools for individuals:

Watch the IRS You Tube videos for an overview of the individual shared responsibility provision and the premium tax credit. Subscribe to Health Care Tax Tips to understand the tax provisions of health care law. has the most updated information about the Affordable Care Act tax provisions for individuals and families. also provides information about rules and responsibilities for employers, as well as tax provisions for insurers, tax-exempt organizations, and other businesses.