My favorite remaining institutions: the justice system and the Fed

March 16th, 2017 at 11:17 am

There are at least two American institutions that remain venerable, albeit vulnerable: the justice system and the Federal Reserve.

On my way in this morning, I learned some details about the Hawaiian judge’s rejection of President Trump’s travel ban v2.0. While team Trump believed they’d removed the problematic language from their first run at this executive order, the judge disagreed, in part—and this is what really moved me—due to Trump’s unequivocal anti-Muslim rhetoric during the campaign.

From the NYT, my bold:

Judge Watson flatly rejected the government’s argument that a court would have to investigate Mr. Trump’s “veiled psyche” to deduce religious animus. He quoted extensively from the remarks by Mr. Trump that were cited in the lawsuit brought by Hawaii’s attorney general, Doug Chin.

“For instance, there is nothing ‘veiled’ about this press release,” Judge Watson wrote, quoting a Trump campaign document titled “Donald J. Trump is calling for a total and complete shutdown of Muslims entering the United States.”

So, what Trump said still matters in the justice system. Contrast this with the laugh Trump’s spokesman Sean Spicer got from the press corps the other day when he said now that Trump’s president and the numbers are favorable, the jobs data are, at least for now, believeable. Or Trump’s claim that there’d be no cuts to Social Security, Medicare, and Medicaid, given that the latter gets gutted by 25 percent by 2026 in the Republican’s Obamacare replacement bill he’s now supporting.

I’ve long held that societies that abandon facts can glide on momentum for a while, but eventually, an economy, environment, and government built on lies cannot survive. While it is often imperfect, the pursuit of truth remains the heart of the justice system. I only hope it can stay there.

As for the Fed, as I wrote yesterday, they’re calling it like they see it on the economy, projecting trend growth rates of 2 percent, and not buying into the administration’s phony claims that tax cuts and deregulation will generate 3-4 percent growth rates.

To be clear, I’m not saying the Fed’s policy path is the only sensible or defensible one, nor am I saying their decisions are free of outside influences, including political ones. Like everyone else who follows their work, I often hear Fed governors say things with which I disagree.

I’m saying that they’re trying to meet their mandate of full employment and stable prices through economic analysis, without spin and without yielding to political pressures, ones that I forecast will pick up in coming months.

Obviously, a key factor these two institutions have in common is political independence. Again, no institution is free from political influences, and in fact, with two, soon to be three, open seats on the Fed’s board of governors, and one seat open on the Supreme Court—all of these seats are presidential appointments (with Senate confirmation)—the afore mentioned vulnerability to political pressure is real. But for now, there are still at least two places where facts can still show up without fear of being assaulted.

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7 comments in reply to "My favorite remaining institutions: the justice system and the Fed"

  1. Tom Cantlon says:

    Ugh. “Remaining” sound institutions we can count on? You’re being positive, but the very fact that we have to consider the “remaining” ones is a sad point.

  2. Smith says:

    Yellen’s adherence to a 2% inflation target contributed to Clinton’s defeat, as did Obama’s acquiescence to a slow recovery, turn to austerity, sequestration, poor bargaining over debt ceiling, compromise on Romneycare, and seeking a grand bargain, pushing the TPP, and a poorly thought out and timed agenda on immigration, which totally backfired. Don’t blame conservatives for being conservative. Blame Democrats for being misguided, ineffective, and in some cases outright sellouts.

  3. William Meyer says:

    Sorry, but just because in one example a judge had delivered a verdict that you agree with doesn’t exactly translate into the notion that the courts are exemplars of objective or unbiased decision making. Far from it. Any thinking person should wake up each day and proclaim their profound gratitude that they have not having been caught up in something like the criminal justice system, or perhaps the home foreclosure courts of Florida, where “justice” is in far too many cases the last priority on anybody’s mind. The real priority: moving the paperwork out of the inbox and into the outbox. There are regrettable negative consequences to the powerless, of course, but the judge doesn’t endure them, so–we’re all good.

    • Smith says:

      Oh good, this also highlights another of the 101 reasons Obama failed to ensure his legacy and needlessly allowed Trump (though narrowly) to emerge Triumphant.
      Exhibit A: Obama had it within his power, with no congressional approval needed to stop cold a significant part of the foreclosure machinery, due to the takeover of Freddie and Fannie by his Dept of Treasury. November 8, 2010
      “The mortgage giants owned more than 240,000 foreclosed homes on Sept. 30, they reported last week. That’s about 25 percent of all lender-owned homes in the United States, according to RealtyTrac.”
      Halting foreclosures would have saved people from losing their homes, restored the housing market sooner and aided recovery, reset prices without requiring needless destruction of actual buildings from neglect, highlighted a tangible difference between laissez-faire capitalist Republicans and Democrats. Weirdly, the tea party movement was inspired by a TV protest against rescuing homeowners.

      How difficult is it to defend a move to save homeowners who lost their job due to Wall Street speculators destroying the economy, while the government bails out the bankers, and the bankers turn around and foreclose on their victims, the homeowners. In America, this is a trope, the mean dastardly banker taking away the family homestead (farm instead of house, as depressions pre mid 20th century often hit rural areas particularly hard in terms of ownership of property, 1860 58% were farmers and 1930, still 21%).

      How stupid do you have to be to allow an inherited collapsed housing market to destroy your political power because your Treasury Dept favors banking interests over families? Why were any homes forced to be vacated and then become worth zero? Why do you think Trump took Ohio so easily, a former battleground state?

      • Looking back says:

        I’m glad I’m not the only one that finds our justice system deplorable. As much as I’d like to agree that a Muslim immigration ban is unconstitutional, the truth is that it isn’t. I don’t see any truth seeking by the Democrats at all. None. They’re generally acting just as bad as Republicans have acted over the years. The Establishment clause refers to congress and not the President. It refers to subjects within our borders rather than subjects outside our borders. The lies are motivated by conscience but anybody that cares about the purpose of the justice system should not let their conscience destroy the meaning of written law.

        Obama destroyed the justice system for money. He probably didn’t understand the resilience of the rest of our traditions and institutions well enough to let justice win over financial stability. Now the Democrats are destroying the borders and setting the precedent of ignoring executive power if it doesn’t seem fair. The proper way for the justice system to operate is to follow the law and allow people to judge the results and decide if the law needs to be changed. And people should be forced to recon with the results of electing a loose cannon rather than degrading the power of institutions and the meaning of the constitution.

        All of this is bad behavior is motivated by fear, misinterpretations of history, exorbitant rhetoric and demagoguery. What do you call a unified front of appeal to an outdated fear of “the Russians”? What do you call false comparisons of an experienced politician with fascist leaders of the past?

        Following the law can cause problems sometimes. It can cause big problems, heartache and worse, but once you’ve made the decision that our conscience is more important than the constitution, you’ve abandoned our institutions completely. Our justice system thinks it can operate upon motive. It tries to define ‘hate’ crimes — as opposed to a ‘love’ crime? — and now it is trying to remove the power to protect our borders from the executive branch, which is where that power lies. Does it seem wise in the long run to destroy the constitution because of one inexperienced politician?

        Obama was a good politician, but he left our country and our world a mess. He surely had a strong conscience but he didn’t seem to respect the document that he taught in Chicago. I see no indication that Democrats think they’ve done anything wrong or that they respect democracy and our institutions at all.

        • Smith says:

          I’m going to reply to the above because it appeared under my comment. But it didn’t not seem to respond to my central point, except to share a diminished view of the previous administration, but for very different reasons. Especially, I would argue the opposite conclusions, my position was that Obama was a terrible politician once elected (though good enough to get elected president twice, with a flimsy resume), but left the country and world in an ok position (like he gets a B+). For sure he played fast an loose with the constitution, mostly as related to national security (surveillance and war powers), but certainly no more than Lincoln or Roosevelt.
          Obama did not destroy the justice system. But he failed to use it to punish those who destroyed the world economy. Politically, letting bankers off the hook created a power vacuum filled by the tea party on the right, and occupy Wall Street on the left. The Tea Party came first and dominated debate, and quickly converted sentiment into political power in Congress and sway over mainstream Republicans, hobbling his administration for six years (a similar fate suffered by Bill Clinton).

          Obama’s biggest mistake was the political ineptitude that prevented him from changing the balance of the Supreme Court. If he filled previous positions quicker and more forcefully, like the open seats on the National Labor Relations Board, Republicans would not have learned how to block his appointments. If he wasn’t sure of a Democratic successor, he might have tried harder, but he wanted TPP in a lame duck session perhaps.

          The Fed is still incompetent, failed to regulate the banks, allowed the housing boom to blow up through fraud, and global economic collapse. They have an insanely low 2% inflation target, and feel duty bound to cause unemployment and low wages as the main weapon against monopolistic businesses raising prices.

          Neither the justice department nor the Fed have records during the Obama administration that are satisfactory. The expected worse performance of Trump’s term does not excuse previous failures which gave rise to Trump. Blame Obama, Clinton, and the Democrats for their failure to make America great again. They’re the ones responsible for losing the deciding 77,000 votes in Wisconsin, Michigan, and Pennsylvania, so full of hubris. How many trips did Clinton make to Wisconsin during the Fall campaign?

  4. We can do better says:

    Unfortunately the alt-global media and the slave plantation owners of Silicon Vally and Wall Street have ruined world and US political relations by ignoring the US constitution in favor of imperialism and total world domination.

    We should be working together right now with Russia and China to eliminate the threat of North Korea without jeopardizing millions of lives, but instead these monsters are still trying to maximize their profits at the expense of the diversity of nations and citizen’s rights.