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      The US central bank is poised to cause untold hardship to millions of Americans | Robert Reich

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      The US central bank is poised to cause untold hardship to millions of AmericansRobert ReichThe Federal Reserve chairman has admitted that at least 2 million people could lose their jobs if interest rates keep risingAs chairman of the Federal Reserve board, Jerome Powell is making his semi-annual policy report to Congress this week. I have an urgent question for Powell that I hope members of Congress will also ask: how can he justify further rate hikes in light of America’s staggering inequality?The US should break up monopolies – not punish working Americans for rising prices | Robert ReichRead morePowell and his colleagues on the Fed’s open market committee are considering pushing interest rates much higher in their quest to get inflation down to their target of 2%. They believe higher interest rates will reduce consumer spending and slow the economy.With all due respect, this is unnecessary – and unjust.Over the past year, the Fed raised interest rates at the fastest pace since the 1980s, from near zero to more than 4.5%. But consumer spending isn’t slowing. It fell slightly in November and December but jumped 1.8% in January, even faster than inflation.As a result, Powell is now saying he may need to lift rates above 5%. A recent paper by a group of academic and Wall Street economists suggests that he will need to raise interest rates as high as 6.5% to meet his 2% target.This would worsen America’s already staggering inequalities.You see, the Americans who are doing most of the spending are not the ones who will be hit hardest by the rate increases. The biggest spenders are in the top fifth of the income ladder. The biggest losers will be in the bottom fifth.Widening inequality has given the richest fifth a lot of room to keep spending. Even before the pandemic, they were doing far better than most other Americans.The top fifth’s savings are still much higher than they were before the pandemic, so they can continue their spending spree almost regardless of how high the Fed yanks up rates.That spending is a big reason Powell and his colleagues at the Fed are having so much difficulty slowing the economy by raising interest rates (in addition to the market power of many big corporations to continue raising prices and profit margins).Those higher rates are flowing back into the top fifth’s savings, on which they’re collecting interest. But yank up rates much more and we’ll impose big sacrifices on lower-income Americans.Powell himself has predicted that at least 2 million people will lose their jobs if he raises interest rates to 4.6% by the end of the year.The study I mentioned a moment ago concludes that “there is no post-1950 precedent for a sizable central-bank-induced disinflation that does not entail substantial economic sacrifice or recession”.Well, there’s also no post-1950 precedent for the degree of income inequality America is now experiencing.Relying on further interest-rate hikes to fight inflation will only worsen the consequence of America’s near-record inequality. The people who will endure the biggest sacrifices as the economy slows will be the first to lose their jobs: mostly, those in the bottom fifth.There’s no reason for further hikes, anyway. Inflation is already slowing.I understand Powell’s concern. What looked like a steady, albeit gradual, slowdown is now looking even more gradual. But so what? It’s the direction that counts.He should abandon the 2% target rate of inflation. There’s nothing sacrosanct about 2%. Why not four? Getting inflation down to 2% is going to cause too much pain for the most vulnerable.And Powell should suggest to Congress that it use other tools to fight inflation, such as barring corporations with more than 30% market share from raising their prices higher than the overall inflation rate – as recently proposed by New York’s attorney general.Mr Powell, if you’re reading, may I be perfectly frank? You weren’t elected to your current post. Nor were your colleagues. That’s understandable. The Fed needs to be insulated from politics. But you at least owe it to America to do your job fairly.It would be terribly unjust to draft into the inflation fight those who are least able.
      Robert Reich, a former US secretary of labor, is professor of public policy at the University of California, Berkeley, and the author of Saving Capitalism: For the Many, Not the Few and The Common Good. His new book, The System: Who Rigged It, How We Fix It, is out now. He is a Guardian US columnist. His newsletter is at robertreich.substack.com
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      Fed announces smallest interest hike in a year as inflation ‘eases somewhat’

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      Fed announces smallest interest hike in a year as inflation ‘eases somewhat’Quarter-point increase to a range of 4.5% to 4.75% signals a slowdown in Fed’s fight against soaring inflation The US Federal Reserve signaled a slowdown in its fight against soaring inflation on Wednesday, announcing its smallest hike in interest rates in almost a year.After its latest meeting, the Fed announced a quarter-point increase in its benchmark interest rate to a range of 4.5% to 4.75%, the smallest increase since March last year. “Inflation has eased somewhat but remains elevated,” the Fed said in a statement adding that “ongoing increases” will be appropriate as it seeks to bring prices down.“We covered a lot of ground, and the full effects of our rapid tightening so far are yet to be felt. Even so, we have more work to do,” said Fed chair Jerome Powell.Inflation in the US has been running at levels unseen since the 1980s, triggering a cost of living crisis as the price of everything from eggs to gas and rent has shot up.In order to tamp down inflation the Fed has aggressively hiked rates as it seeks to cool the economy and bring prices back under control.A year ago the Fed rate – which affects the interest rates on everything from business and personal loans to mortgages and credit card rates – was close to zero. After the most rapid series of rises since the 1980s, it is now at a level last seen in 2007.There are signs that prices are coming down. In December, the annual rate of inflation fell to6.5% from 7.1% in the previous month, the sixth straight month of yearly declines and well below the peak of 9.1% it hit in June, its highest rate since 1982.Consumer spending – the largest driver of the economy – fell 0.2% from November to December. The housing market has slowed and many of the major tech companies have announced large job cuts as they have moved to rein in spending.But inflation remains well above the Fed’s annual target rate of 2% and the central bank has said it will keep rates high until price stability is achieved. The Fed also continues to worry about the jobs market. The unemployment rate was 3.5% in December, a 50-year low and on Wednesday the labor department announced there were 11m job openings in the US in December – almost two available jobs for every person looking for one and an increase from November.The tight labor market has driven up wages and Powell, has made clear that the central bank believes rising wages threaten to spur on inflation – a so-called wage-price spiral. “You don’t see that yet, but the whole point is, once you see it, you have a serious problem. That means that effectively in people’s decision-making, inflation has become a real salient issue,” said Powell. “That is what we can’t allow to happen.”TopicsFederal ReserveUS economyJerome PowellEconomicsUS politicsInflationnewsReuse this content More

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      The US should break up monopolies – not punish working Americans for rising prices | Robert Reich

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      The US should break up monopolies – not punish working Americans for rising pricesRobert ReichThe Fed is putting people out of work to reduce workers’ bargaining power and reduce inflation. They’ve got it all wrong Job growth and wages are slowing. Employers added 223,000 jobs in December, the labor department reported on Friday – lower than the average in recent months.Average hourly wages rose by 4.6% in December, according to Friday’s report. That’s a slowdown from 4.8% in November.All this is music to the ears of Federal Reserve chair Jerome Powell, because the Fed blames inflation on rising wages. The Fed has been increasing interest rates to slow the economy and thereby reduce the bargaining power of workers to get wage gains.At his press conference on 14 December announcing the Fed’s latest interest rate hike, Powell warned that “the labor market remains extremely tight, with the unemployment rate near a 50-year low, job vacancies still very high, and wage growth elevated”.But aren’t higher wages a good thing?The typical American worker’s wage has been stuck in the mud for four decades.Most of the gains from a more productive economy have been going to the top – to executives and investors. The richest 10% of Americans now own more than 90% of the value of shares of stock owned by Americans.Powell’s solution to inflation is to clobber workers even further. He says “the labor market continues to be out of balance, with demand substantially exceeding the supply of available workers”.But if the demand for workers exceeds the supply, isn’t the answer to pay workers more?Not according to Powell and the Fed. Their answer is to continue to raise interest rates to slow the economy and put more people out of work, so workers can’t get higher wages. That way, “supply and demand conditions in the labor market [will] come into better balance over time, easing upward pressures on wages and prices,” says Powell.Putting people out of work is the Fed’s means of reducing workers’ bargaining power and the “upward pressures on wages and prices”.The Fed projects that as it continues to increase interest rates, unemployment will rise to 4.6% by the end of 2023 – resulting in more than 1m job losses.But fighting inflation by putting more people out of work is cruel, especially when America’s safety nets – including unemployment insurance – are in tatters.As we saw at the start of the pandemic, because the US doesn’t have a single nationwide system for getting cash to jobless workers, they have to depend on state unemployment insurance, which varies considerably from state to state.Many fall through the cracks. When the pandemic began, fewer than 30% of jobless Americans qualified for unemployment benefits.The problem isn’t that wages are rising. The real problem is that corporations have the power to pass those wage increases – along with record profit margins – on to consumers in the form of higher prices.If corporations had to compete vigorously for consumers, they wouldn’t be able to do this. Competitors would charge lower prices and grab those consumers away.Corporations aren’t even plowing their extra profits into new investments that would generate higher productivity in the future. They’re buying back their shares to boost stock prices. Through the end of 2022, American firms announced stock buybacks exceeding $1tn.A rational response to inflation, therefore, would not increase unemployment in order to reduce the bargaining power of workers to get higher wages.It would be to reduce the pricing power of corporations to pass those costs along to consumers along with rising profit margins, by making markets more competitive.Corporate pricing power is out of control because corporations face so little competition.Worried about sky-high airline fares and lousy service? That’s largely because airlines have merged from 12 carriers in 1980 to four today.Concerned about drug prices? A handful of drug companies control the pharmaceutical industry.Upset about food costs? Four giants now control over 80% of meat processing, 66% of the pork market, and 54% of the poultry market.Worried about grocery prices? Albertsons bought Safeway and now Kroger is buying Albertsons. Combined, they would control almost 22% of the US grocery market. Add in Walmart, and the three brands would control 70% of the grocery market in 167 cities across the country.And so on. The evidence of corporate concentration is everywhere.It’s getting worse. There were over a thousand major corporate mergers or acquisitions last year. Each had a merger value of $100m or more. The total transaction value was $1.4tn.The government must stop putting the responsibility for fighting inflation on working people whose wages have gone nowhere for four decades.Put the responsibility where it belongs – on big corporations with power to raise their prices.One possibility: any large corporation in an industry dominated by five or fewer giant corporations that raises its prices more than the Fed’s target of 2% should be presumed to have monopoly power, and slammed with an antitrust lawsuit.
      Robert Reich, a former US secretary of labor, is professor of public policy at the University of California, Berkeley, and the author of Saving Capitalism: For the Many, Not the Few and The Common Good. His new book, The System: Who Rigged It, How We Fix It, is out now. He is a Guardian US columnist. His newsletter is at robertreich.substack.com
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      US adds 263,000 jobs in November as unemployment rate stays at 3.7%

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      US adds 263,000 jobs in November as unemployment rate stays at 3.7%Jobs market remains strong even as Fed imposes biggest series of rate rises in decades in effort to tame inflation The US added 263,000 jobs in November, the labor department announced on Friday, another strong month of jobs growth. The unemployment rate remained at 3.7%, close to a 50-year low.Employers hired 284,000 new positions in October and 269,000 in September and the latest figures show hiring has remained resilient despite rising interest rates and the announcement of a series of layoffs at technology and real estate companies.The jobs market has remained strong even as the Federal Reserve has imposed the biggest series of rate rises in decades in its fight to tame inflation. This week, the Fed chair, Jerome Powell, indicated that the continuing strength of the jobs market – and rising wages – were likely to trigger more rate rises in the coming months.The US had been expected to add 200,000 jobs in November. The latest jobs numbers – the last before the Fed meets to decide its next move later this month – will strengthen the central bank’s resolve to keep raising rates.“This phenomenal labor market is showing little sign of slowdown,” said Becky Frankiewicz, president and chief commercial officer of ManpowerGroup. “Despite recurring headlines of deep cutbacks – primarily in tech – other sectors have scaled up; and while we’ve been bracing for a downturn, the broader labor market has barely flinched.”Economists expect rate hikes will eventually dampen hiring, potentially leading to a recession and job losses next year. But so far, the jobs market has shaken off the Fed’s interventions.The government figures follow a downbeat report from ADP, the US’s largest payroll supplier. On Wednesday, ADP said the private sector had added just 127,000 positions for the month, well below the 190,000 forecast by economists and a steep reduction from the 239,000 jobs ADP recorded in October.ADP’s chief economist, Nela Richardson, said it was still too early to say but it seemed the rate rises were filtering through to hiring decisions.“Turning points can be hard to capture in the labor market, but our data suggest that Federal Reserve tightening is having an impact on job creation and pay gains,” said Richardson. “In addition, companies are no longer in hyper-replacement mode. Fewer people are quitting and the post-pandemic recovery is stabilizing.”TopicsUS unemployment and employment dataUS economyFederal ReserveUS politicsnewsReuse this content More

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      We need serious public policy, not more printed money – the US economy is in tatters

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      AnalysisWe need serious public policy, not more printed money – the US economy is in tattersDoug HenwoodDecades of bailouts have convinced some that the Fed will always come to the rescue – but this only papers over the fundamental flaws of the US economy With the Federal Reserve leading the world’s central banks in a tightening cycle of interest rate rises, the likes of which we haven’t seen since 2006, commentators across the political spectrum are noting the fondness of the Fed chair, Jerome “Jay” Powell, for his legendary predecessor, Paul Volcker. On the left, the comparison is fearful; on the center and on the right, it’s one of admiration. But circumstances don’t really support the comparison.Fed announces sixth consecutive hike in US interest rates to fight inflationRead moreOn taking office in October 1979, Volcker declared “the standard of living of the average American has to decline” as a consequence of the war against the chronic inflation of the 1970s. He quickly set to work making that happen by driving interest rates up towards 20% and creating the deepest US recession since the 1930s.That squeeze did put an end to high inflation but at a tremendous social cost. Six million people lost their jobs over the next three years, taking the unemployment rate from 6% to almost 11% in late 1982. The cost wasn’t merely short-term. About half of those job losses were categorized as permanent, as opposed to being temporary layoffs, many of them in the manufacturing heartland. The term “rust belt” entered common usage.Volcker was appointed by Jimmy Carter, who seemed to have no idea of what he was getting himself into. His friend and adviser, the Georgia banker Bert Lance, prophetically warned him that he was dooming his prospects in the 1980s election. But Carter listened to the consensus of Wall Street and the political class – Volcker was the man to tame inflation, which was running around 13% at the end of 1979. The US had seen inflation rates that high before, but never outside of major wars or their immediate aftermath. Inflation, which was under 2% in 1965, had been rising relentlessly for 15 years, barely pausing even in the nasty recession of the mid-1970s. Contrary to a belief popular on the left, that inflation was not kind to workers. Wages badly lagged prices, and real average hourly earnings fell 14% between 1973 and 1980.There are some similarities between the present and 40 years ago. Then, as now, food and energy prices were important factors in sparking inflation, but in both cases, even if you strip out those two volatile components, a severe inflation remains. And in both cases, polls have shown inflation to be deeply unpopular.But there are also major differences, notably in the strength of labor. At the end of the 1970s, almost a quarter of all workers were unionized; now only about a tenth are. Then, an average of 22,000 workdays were lost to strikes every year; last year it was just 1,500 – a decline of 93%. The early 1980s recession hammered the bargaining power of the working class. Unions were busted, and we went from a time when Take This Job and Shove It could be a hit song (as it was in 1977) to one where workers were grateful to have any job at all, no matter how tenuous and low-paying. As the recession ended in late 1982, the stock market took off and the employer class began a 40-year celebration of its triumph.That’s not the world Powell finds himself in. Inflation has been a problem for close to 15 months rather than 15 years, and although there are some tentative signs of life in the labor movement – notably at one Amazon site and a few hundred Starbucks outlets (out of 9,000) – the share of the labor force represented by unions fell last year, and strike activity so far in 2022 is about a third lower than in 2021. Unlike the inflation of the 1970s, this is not the wage-push kind (to use the jargon). It’s been driven first by supply chain blockages, thanks to Covid, and extended by embargoes against Russian energy exports, and most workers are just looking on helplessly as their paychecks fail to keep up with price increases.There’s another difference as well: we’re coming off a decade of extremely indulgent monetary policy. Coming out of the Great Recession, the Fed kept short-term interest rates near zero between 2011 and 2021, with the brief exception when they pushed them up to just over 2% in 2017 and 2018 (still quite low by historical standards). On top of that, the central bank pumped over $3tn (£2.7tn) into the financial markets between 2008 and 2015, and almost $5tn between early 2020 and early 2022. The earlier pumping was meant to prevent a financial implosion after the sub-prime crisis, and the latter to counter the threats of the early pandemic months. But the result of both has been to stimulate crazy inflation in asset prices – stocks, crypto, unicorns, housing – a remarkable waste of capital and one that can be very risky to deflate. Decades of bailouts have convinced financial market players that the Fed will always come in to rescue them and reversing that mentality could require a Volckerish austerity for Wall Street – one that’s politically hard to imagine.The Fed’s interest rate hikes are going to hit the most vulnerable | Dean BakerRead moreWhat Powell is up to now bears almost no resemblance to Volcker’s clampdown. The federal funds rate, the interest rate at which banks lend each other money overnight – that is the Fed’s most direct policy target – changed from just above 0% to just under 4% after raising the target rate another 0.75 points this week. That’s almost 15 points below the Volcker peak. In real terms – deducting the rate of inflation – Volcker’s peak was almost 10%, a lot higher. Right now, the real fed funds rate is around -4% (yes, that’s a negative sign). Powell may admire Volcker, but next to him, he’s a piker.The debate over monetary policy overlooks a more important issue. That decade of cheap money papered over a lot of fundamental problems with the US economy: low levels of public and private investment, massive polarization between rich and poor and unstable employment for much of the labor force. These should be addressed with serious public policy, not by printing money. It would be nice if we talked about that, but given the degraded state of American political discourse, I’m not hopeful.
      Doug Henwood is an economic journalist based in Brooklyn. His radio show, Behind the News, airs on KPFA radio in Berkeley, and is available on all the standard podcast outlets
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      Don’t be fooled: policymakers are quietly invoking austerity by other names | Clara Mattei

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      Don’t be fooled: policymakers are quietly invoking austerity by other namesClara MatteiFraming monetary policy as a war effort has been part of the playbook for instituting austerity policies for over a century Austerity, like trickle-down economics, has been relegated to the list of things economists don’t talk about anymore. Austerity’s core policies – hikes in interest rates, downward pressure of fiscal spending and wages – had their last stand with the European sovereign-debt crisis a decade ago, and the resulting public outcry made the “a-word” unmentionable, even in times of economic crisis. So, on 21 September, when Federal Reserve Chair Jerome Powell announced his fifth interest-rate hike of the last nine months, this dirtiest word in economic policy was conspicuously absent from his remarks. Instead, Powell described the process of resetting the economy – through the introduction of increased unemployment and possible recession –as a necessary form of “economic pain.” Powell’s comments echoed those of his British counterpart, former chancellor of the Exchequer Rishi Sunak, in a letter to Boris Johnson: “[the public] need to know that whilst there is a path to a better future, it is not an easy one.” This framing of monetary policy as some sort of war effort – hard work and individual sacrifice for the greater good –has been part of the playbook for instituting austerity policies for more than a century. In 1920, at the first international financial conference in Brussels, British civil servant Robert H Brand evangelized economic narratives focused on this “hard truth”: in order for the economy to get back on its feet after World War I, “the answer is a very painful one and yet a very simple one. We must all work hard, live hard, and save hard.” As Powell, Sunak and Brand demonstrate, the road to austerity is paved with vague euphemisms.For a policy so reviled that officials can’t even speak its name, austerity continues to enjoy a remarkable century-long run as the go-to policy prescription for national economies in strife. This is even more remarkable when one considers that, as the work of political economist Mark Blyth and others have shown, austerity policies don’t actually work – at least not in their stated ends of boosting economic growth and reducing debt. If we know that austerity doesn’t fix what needs fixed, then why is it suddenly making a comeback? Keynesian critics dismiss this paradox as a simple matter of bad policy informed by bad economic theory. But how does this response square with a world that is increasingly stewarded by Keynesian economists – a world in which the Keynesians are the ones courting austerity?A more satisfying explanation emerges when we recognize that austerity is more than just a tool for managing an economy. Rather, austerity is a political project that is crucial to upholding the smooth functioning of our economic system.In order for a capitalist system to work in delivering economic growth, the social relation of capital – people selling their labor power for a wage – must be stable across a society. Where prices or wages go up or go haywire, the system fails, and economic disaster quickly follows.‘Starve and shiver with Sunak’ is the reality for millions. The chancellor can – and must – stop it | Gordon BrownRead moreIn this way, a country’s commitment to economic growth presupposes a certain sociopolitical order, or capital order. Every capitalist society needs accumulation at the top and laboring at the bottom in order to keep expanding its pie. This organization is neither fixed nor a given; it has to be constantly protected through economic policies. That’s exactly the function austerity serves: it preserves the basic class relations at the core of our economy, especially in times of social changes. In the US, that social changeis the rapid reconfiguring of the labor market since the onset of the pandemic. It is no longer the case that the lowest-paying jobs are eagerly taken up by a labor class; instead, many people have seemingly reexamined the merits of participating in a labor market rife with unappealing conditions. And as inflation makes wage work even less sustainable than it was before the pandemic, the problem is compounded. The fiscal, monetary, and industrial measures that make up austerity are not, as they’re typically described, an economic war effort for the greater good. They are simply the crude tools for reestablishing the quiet disciplinary mechanisms that organize modern societies. For some, the short-term cost of a temporary economic recession is worth its structural gain; austerity restabilizes class relations and thus refurbishes the conditions for profits. As we enter a period of “economic pain,” it is worth considering whether this endgame justifies it.
      Clara E Mattei is assistant professor of economics at the New School for Social Research in New York City. She is author of The Capital Order: How Economists Invented Austerity and Paved the Way to Fascism, which will publish in November from the University of Chicago Press
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      Fed raises interest rate by 0.75 percentage points as US seeks to rein in inflation

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      Fed raises interest rate by 0.75 percentage points as US seeks to rein in inflationThird outsized rate increase in a row as central bank struggles to fight runaway inflation, increasing the cost of everything The Federal Reserve announced another sharp hike in interest rates on Wednesday as the central bank struggles to rein in runaway inflation.The Fed raised its benchmark interest rate by 0.75 percentage points, the third such outsized rate increase in a row, bringing the Fed rate to 3%-3.25% and increasing the cost of everything from credit card debt and mortgages to company financing.The central bank signaled more raises to come, predicting rates would reach 4.4% by the end of the year and not start coming down until 2024. The Fed expects the rate rises to hit the job market – raising unemployment from 3.7% to 4.4% next year – housing prices and to lower economic growth.“We have got to get inflation behind us. I wish there were a painless way to do that. There isn’t,” the Fed chair, Jerome Powell, said. “We have always understood that restoring price stability while achieving a relatively modest increase in unemployment and a soft landing would be very challenging. And we don’t know. No one knows whether this process will lead to a recession or if so, how significant that recession would be.”Central bankers around the world are raising rates sharply as they too attempt to tackle the cost of living crisis. This week the Bank of England is expected to announce its largest rate rise in 25 years. The European Central Bank raised interest rates across the eurozone by a record margin earlier this month.The Fed initially dismissed rising inflation, arguing it was a “transitory” phase triggered by the pandemic and supply chain issues. But as prices escalated the Fed announced a series of aggressive moves in the hopes of bringing prices back under control.Until recently Powell had said he hoped that the economy could achieve what he called a “soft landing” – a slowdown that would bring costs down but not lead to a spike in unemployment and a recession.Speaking at a congressional hearing on Wednesday, some of the US’s top bankers said it was too early to tell how rate rises would impact the economy. “I think there’s a chance, not a big change, a small chance, of a soft landing,” said Jamie Dimon, chief executive of JPMorgan Chase.“There’s a chance of a mild recession, a chance of a hard recession. And because of the war in Ukraine and the uncertainty in global energy and food supply, there’s a chance that it could be worse. I think policymakers should be prepared for the worst, so we take the right actions if and when that happens,” he said.Raising rates makes borrowing more expensive which should reduce spending and lower prices. But the policy is a blunt instrument and rate rises take time to filter through to the wider economy. So far the Fed’s rate rises have not had a significant impact.The US jobs market remains robust, with unemployment still close to a 50-year low, consumer spending rose last month and inflation remained stubbornly high in August, 8.3% higher than a year ago.There are, however, some signs of a slowdown. Existing home sales fell in August for the seventh consecutive month, according to the National Association of Realtors. Sales were 19.9% lower than in August 2021 and are now at their lowest level since they briefly stalled during the height of the pandemic in 2020. And large employers including BestBuy, Ford and Walmart have announced layoffs or hiring freezes.TopicsFederal ReserveUS economyBank of EnglandInflationEconomicsEuropean Central BankUS politicsnewsReuse this content More

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      Trump search affidavit reveals potential for ‘evidence of obstruction’ at Mar-a-Lago – as it happened

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      The affidavit as released is of course full of redactions, across its 38 pages. But it reveals some interesting nuggets about the search, including that the Department of Justice and FBI had “probable cause to believe that evidence of obstruction” would be found at Mar-a-Lago.In another interesting section … the affidavit says that on 9 February 2022, the DoJ leaned that a preliminary review of 15 boxes taken to Mar-a-Lago “indicated that they contained ‘newspapers, magazines, printed news articles, photos, miscellaneous print-outs, notes, presidential correspondence, personal and post-presidential records, and ‘a lot of classified records’.“Of most significant concern was that highly classified records were unfoldered, intermixed with other records, and otherwise unproperly [sic] identified.”The affidavit reproduces a Trump statement after the issue became public, and then … is extensively redacted. The redacted passage is a chronological retelling of how the issue developed. The next significant un-redacted passage contains the news that Trump’s own notes were included in the materials in question. It reads as follows:“From May 16-18, 2022, FBI agents conducted a preliminary review of the FIFTEEN BOXES provided to NARA and identified documents with classification markings in fourteen of the FIFTEEN BOXES. A preliminary triage of the documents with classification markings revealed the following approximate numbers: 184 unique documents bearing classification markings, including 67 documents marked as CONFIDENTIAL, 92 documents marked as SECRET, and 25 documents marked as TOP SECRET. Further, the FBI agents observed markings reflecting the following compartments/dissemination controls: HCS, FISA, ORCON, NOFORN, and SI.“Based on my training and experience, I know that documents classified at these levels typically contain NDI. Several of the documents also contained what appears to be FPOTUS’s [Trump’s] handwritten notes.Closing summaryIt has been a day of drama as the redacted affidavit explaining why the FBI chose to raid Donald Trump’s Mar-a-Lago residence was finally published to an eagerly awaiting world. It wasn’t exactly a damp squib. The document – much of which was blanked out – detailed the huge numbers of secret documents squirreled away and security risks they posed.But due to the large numbers of redactions there was no explosive new line, though one thing does seem certain: this FBI investigation is just getting started and has a long long way to go.Here’s what else happened today:
      Amy Coney Barrett was in the news via a Guardian US scoop showing that a faith group she has been closely associated with places huge emphasis on female obedience.
      Joe Biden and his administration stood by his calling out of the Republican politicians as behaving like semi-fascists. The move drew ire from the rightwing party.
      Washington is to follow the path of its fellow west coast state California and pursue the eventual ban of sales of new gasoline-powered cars.
      A Jim Crow-era provision of the Mississippi constitution designed to disfranchise Black voters is constitutional, a federal appellate court ruled.
      Dow drops 1,000 pointsThe Guardian’s Dominic Rushe writes here that there has been a steep drop on Wall Street in response to the latest forecasts on the economy from Federal Reserve chief Jerome Powell.A 1,000 plus point drop is hardly a catastrophe but it is definitely a nasty fall.Dominic writes: US stock markets nosedived on Friday after Federal Reserve chair, Jerome Powell, warned of “pain” ahead as the central bank struggles to bring down inflation from a 40-year high.Powell’s highly anticipated speech was more hawkish than had been expected, with the Fed chair pledging to do all he could to end rising prices. The Dow Jones Industrial Average lost just over 1,000 points, 3%, the S&P fell 3.3% and the Nasdaq dropped almost 4%.Speaking at the Kansas City Fed’s annual meeting of the world’s central bankers in Jackson Hole, Wyoming, Powell said the Fed’s “overarching focus right now is to bring inflation back down”.Read more:Dow plunges 1,000 points after Fed chief Powell warns of inflation ‘pain’Read moreNikki Haley for 2024?The former UN ambassador under Donald Trump is often mentioned as a potential 2024 candidate and someone who could – potentially – straddle the two disparate and often bitterly feuding worlds of Trump and non-Trump Republicans.That sees Haley frequently seek to a perform a difficult dance between courting her old bosses’ favor, but also trying not to seem too close to him.Politico has the details of some of the people donating to her political future and it makes interesting reading of a long list of Republican stalwarts.The report says: “Many of the GOP’s biggest donors are among those who funneled anonymous contributions to former U.N ambassador Nikki Haley’s nonprofit as she lays the groundwork for a prospective 2024 presidential bid, according to previously unreported tax documents obtained by Politico.Haley’s nonprofit policy advocacy group, Stand For America, Inc, has received major donations from people including New York hedge fund manager Paul Singer, investor Stanley Druckenmiller, and Miriam Adelson and her late husband, casino mogul Sheldon Adelson, the Internal Revenue Service filings reveal.The roster of supporters who gave undisclosed donations in 2019 also includes Suzanne Youngkin, the wife of Virginia Governor Glenn Youngkin, himself a possible presidential contender; former Pennsylvania Senate candidate and hedge fund executive David McCormick; and Vivek and Lakshmi Garipalli, members of a New Jersey family that has donated large sums to Democrats – but which gave Haley’s organization $1 million.”Fascist or not?It might have seemed an odd question even just a few years ago, but Joe Biden’s speech on Thursday night has put the word “fascism” squarely into mainstream American political discourse.His accusations that modern Republicans were behaving like semi-fascists certainty triggered questions to his top press spokesperson. The Biden administration – understandably – is standing behind the phrase.Reuters captures the scene:The actions of some Republicans allied to former President Donald Trump fit the definition of fascism, White House spokeswoman Karine Jean-Pierre told reporters on Friday, a day after President Joe Biden said they edged toward “semi-fascism.”“I was very clear when laying out and defining what MAGA Republicans have done and you look at the definition of fascism and you think about what they’re doing in attacking our democracy. … That is what that is. It is very clear,” Jean-Pierre told a press briefing.MAGA refers to Trump’s “Make America Great Again” slogan. Fascism is a political philosophy that exalts nation and often race above the individual and supports an autocratic government led by a dictatorial leader involving the forced suppression of opposition, U.S. dictionary Merriam-Webster says.In response to Biden’s Thursday evening comments that Trump-allied Republicans embraced violence and hatred, and edged toward “semi-fascism,” the Republican National Committee called the remarks “despicable.”A key questionWashington Post columnist Helaine Olen seems to have hit the nail on the head with a very simple tweet. Answers on a postcard please… no redactions.What’s the innocent explanation for Trump keeping all these classified documents?— Helaine Olen (@helaineolen) August 26, 2022
      Arizona judge strikes blow against election fairness skepticsIn just one of many such scenes playing out in courts across the US, Republicans who believe Donald Trump’s unfounded claims of a stolen election and a fraudulent US voting process have suffered a set back.An Arizona judge has refused to require that Arizona officials count ballots by hand in November, dismissing a lawsuit filed by Republican nominees for governor and secretary of state based on false claims of problems with vote-counting machines.AP has more: Kari Lake, who is running for governor, and Mark Finchem, a secretary of state candidate, won their GOP primaries after aggressively promoting the narrative that the 2020 election was marred by fraud or widespread irregularities.Their lawsuit repeated unfounded allegations about the security of machines that count votes. They relied in part on testimony from Donald Trump supporters who led a discredited review of the election in Maricopa County, including Doug Logan, the CEO of Cyber Ninjas, who oversaw the effort described by supporters as a “forensic audit.”U.S. District Judge John Tuchi ruled that Lake and Finchem failed to show any realistic likelihood of harm and that their lawsuit must be brought in state, not federal, court. He also ruled that it is too close to the election to upend the process.“The 2022 Midterm Elections are set to take place on November 8,” Tuchi wrote. “In the meantime, Plaintiffs request a complete overhaul of Arizona’s election procedures.”Various reactions have been pouring out online over the affidavit. Virginia Democratic senator Mark Warner, who chairs the Senate Intelligence Committee said:.css-knbk2a{height:1em;width:1.5em;margin-right:3px;vertical-align:baseline;fill:#C70000;}“It appears, based on the affidavit unsealed this morning, that among the improperly handled documents at Mar-a-Lago were some of our most sensitive intelligence * which is one reason the Senate Intelligence Committee has requested, on a bipartisan basis, a damage assessment of any national security threat posed by the mishandling of this information. The Department of Justice investigation must be allowed to proceed without interference.” Meanwhile, North Carolina Republican Representative Dan Bishop said: “So much for transparency,” tweeting alongside a photo of redacted sections of the affidavit. Bishop is a member of the House of Representatives Homeland Security and Government Affairs Committee.Donald Trump’s son Donald Trump Jr. echoed similar sentiments online, tweeting a photo of the redacted affidavit with the caption, “Well this really clears things up.” Well this really clears things up. pic.twitter.com/6S2FxIQtSi— Donald Trump Jr. (@DonaldJTrumpJr) August 26, 2022
      Nina Lakhani and Oliver Milman report…Taking on the fossil fuel industry in West Virginia was always going to be a David v Goliath type battle, but after years of protests, lobbying and lawsuits, 68-year-old Becky Crabtree thought the community-led resistance had beaten the Mountain Valley pipeline (MVP) in a fair fight.So when news broke earlier in August that the state’s fossil-fuel friendly senator Joe Manchin had resurrected the pipeline, Crabtree, a high school science teacher who teaches students about the climate crisis, felt “numb”.Manchin, a conservative Democrat who receives more campaign financing from the fossil fuel industry – including pipeline companies – than any other lawmaker in Congress, had agreed to back his party’s historic climate legislation before the crucial midterm elections. But only after he negotiated a side-deal to fast-track the MVP.“It’s the unfairness that makes me so angry. It’s a deal with the devil,” said Crabtree, 68, who owns a 30-acre sheep farm in Lindside, Monroe county.Full story:‘It’s a deal with the devil’: outrage in Appalachia over Manchin’s ‘vile’ pipeline plan Read moreWhite House press secretary Karine Jean-Pierre has just finished briefing the media and taking questions and she was asked about Joe Biden’s remarks at a fundraiser last night where he referred to the “MAGA Republican philosophy” as akin to “semi-fascism”.Asked to explain what the US president meant by that remark, Jean-Pierre said of right-wing Republicans: “He was very powerful last night. When it comes to ‘MAGA Republicans’, when it comes to the extreme, ultra wing of the Republicans, they are attacking democracy, they are taking away rights and freedoms, they are using threats of violence, taking away voting rights, and he [Biden] called it what it is … and what many would argue, historians would agree with us on.”“He believes that presidents should be the strongest voice for democracy,” she added.Jean-Pierre also strove to differentiate between what she referred to as “traditional, conservative” Republicans and the [Trumpist] “Make America Great Again” rightwing loyalists to the former president.A quick recap, blog readers, it’s been a dramatic morning and there will be plenty more news over the coming few hours. But for now, here’s where things stand:
      Donald Trump has released a statement about the release of the government affidavit that underpinned the search of his Mar-a-Lago club and residence in Florida earlier this month. He posted it on Truth Social, his struggling social media platform that he created after being banned by Twitter.
      The US Department of Justice and the FBI had “probable cause to believe that evidence of obstruction” would be found at Mar-a-Lago when it sought a warrant to search the property, the affidavit notes.
      The affidavit is replete with details that would provide “a roadmap” for anyone intent on obstructing the investigation.
      The affidavit reminds us of the context of the FBI raid on Mar-a-Lago, thus: “The government is conducting a criminal investigation concerning the improper removal and storage of classified information in unauthorized spaces, as well as the unlawful concealment or removal of government records.”
      While the public waited for the affidavit to be released, we also noted that Joe Biden called the “MAGA Republican” philosophy “semi-fascism” last night, based on the anti-democratic efforts of the more extreme wing of the GOP that hews unfailingly to Trump.
      We have Donald Trump’s reaction, on Truth Social, the social media platform he set up after being kicked off Twitter over the Capitol attack….css-knbk2a{height:1em;width:1.5em;margin-right:3px;vertical-align:baseline;fill:#C70000;}Affidavit heavily redacted!!! Nothing mentioned on “Nuclear,” a total public relations subterfuge by the FBI & DOJ, or our close working relationship regarding document turnover – WE GAVE THEM MUCH. Judge Bruce Reinhart should NEVER have allowed the Break-In of my home. He recused himself two months ago from one of my cases based on his animosity and hatred of your favorite President, me. What changed? Why hasn’t he recused himself on this case? Obama must be very proud of him right now!To unpick:
      “Nuclear” – it has been reported that some of the materials kept at Mar-a-Lago concerned nuclear weapons. And some concerned Emmanuel Macron, which, by the by, might interest Liz Truss. But anyway…
      “Break-in” – nope. Warrant duly served, etc, which is why we’re here.
      “Obama must be very proud” of the judge … we may all remember John Roberts, the chief justice of the supreme court, rebuking Trump for referring to “Obama judges”, etc. We may also all remember Trump’s pride at having installed a huge number of judges himself, including three on Roberts’ court. In short – judges are not meant to act politically but they are politically appointed. And so on.
      Of Judge Reinhart: he made a donation to Barack Obama in 2008. He also donated to Republicans, if not Donald J Trump.
      Attached to the affidavit is a letter from lawyers for Donald Trump, complaining of unfair treatment and asserting a president’s “absolute authority to declassify documents” – both features of his response to the search and the claims of his supporters in Republican ranks and on the right of the US media.The letter, signed by M Evan Corcoran of Silverman Thompson Slutkin White, begins:.css-knbk2a{height:1em;width:1.5em;margin-right:3px;vertical-align:baseline;fill:#C70000;}Public trust in the government is low. At such times, adherence to the rules and long-standing policies is essential. President Donald J Trump is a leader of the Republican Party. The Department of Justice (DOJ), as part of the Executive Branch, is under the control of a President from the opposite party. It is critical, given that dynamic, that every effort is made to ensure that actions by DOJ that may touch upon the former President, or his close associates, do not involve politics.”I refer you back to President Joe Biden’s comment to reporters before the affidavit was filed today, when asked if he thought national security might have been compromised at Mar-a-Lago while Trump was storing classified documents there:.css-knbk2a{height:1em;width:1.5em;margin-right:3px;vertical-align:baseline;fill:#C70000;}We’ll let the justice department determine that.”The lawyers’ letter conforms to Trump’s worldview, that attorneys general and the Department of Justice exist to serve presidents politically. Biden’s answer speaks for generally accepted wisdom, which is that the DoJ does not exist for that purpose and is in fact independent of any White House or administration. More