In praise of Pelosi

I’ve never been a fan of Nancy Pelosi, and did not agree with her reluctance to impeach Trump.  So today I need to grudgingly give her credit. By waiting for a smoking gun, she made the process seem less partisan.

The impeachment won’t lead to conviction in the Senate; Trump could murder someone in the middle of Times Square and his Republican supporters would stick with him.  (The only Trump claim I’ve ever agreed with.)  But the House should do its job.

Gotta love this:

The White House accidentally sent its anti-impeachment talking points intended for allies in Congress to House Democrats.

So how do the “talking points” explain away an obvious abuse of power?

The talking points urge allies to reiterate that Trump made no promises to Zelensky and that he didn’t bring up his personal lawyer, Rudy Giuliani, until his Ukrainian counterpart brought him up.

The White House memo summarizing the conversation, released to the public a few hours before, shows that Trump sought Zelensky’s cooperation as a “favor,” but does not contain a specific offer of a quid pro quo. At the time, much-needed American military aid for Ukraine had been held up for unexplained reasons, reportedly at the request of the White House.

A “favor”?  Well, OK then!  I hope defendants in future mafia or Wall Street corruption cases remember this memo when federal prosecutors present surveillance tapes of them asking for various “favors”.

And won’t the new Ukrainian president be pleased that Trump just threw him under the bus.  I thought he was going to clean up corruption in the Ukraine.  After all, he did in the TV show that his campaign was based on.

PS.  Don’t forget that as we saw with the Mueller report, the initial White House edited version likely understates how bad things were.  And there are multiple phone calls.  There’s much worse information out there.

And there’s this:

Separately, the Justice Department released a revised version of a memo by its office of legal counsel that declared that it was lawful to withhold that complaint from Congress, notwithstanding an inspector general’s determination that the complaint was credible and raised an “urgent concern” of the sort that a statute says must be shown to lawmakers.

The deep state?  Trump appointed the Inspector General.  And so what if a “statute” says the report “must” be shown to Congress.  Does anyone still think this banana republic relies on the rule of law?

PPS.  Last month when I lamented the dictatorial approach of Boris Johnson I was accused by commenters of being hysterical. Nothing to see here, prorogation is completely normal. Actually, this specific type of prorogation is not at all normal. Nor is it normal for the Prime Minister to lie to the Queen about the reasons for prorogation. Nor is it normal for a party to expel 21 of its MPs, including previous top officials.

Fortunately, the British system seems strong enough to survive all of this. The Supreme Court ruled 11-0 that Johnson’s actions were illegal. Before that, Parliament voted to stop a hard Brexit. Of course the Brexiteers insist that the “will of the people” is being thwarted, even though they were the ones who stopped Theresa May’s Brexit proposal, and even though the proponents of Brexit promised a Brexit as soft as a goose down pillow, with the EU meekly agreeing to good terms with the UK, and even though the voters never said exactly what sort of Brexit they wanted. (Given that only 52% voted for Brexit, it seems overwhelmingly likely that “soft Brexit” was the median vote, unless you think that less than 2% of the 52% favored a soft Brexit.)



63 Responses to “In praise of Pelosi”

  1. Gravatar of E. Harding E. Harding
    25. September 2019 at 12:10

    Dumb post, Sumner. Do better.

  2. Gravatar of Brian Donohue Brian Donohue
    25. September 2019 at 12:48

    Alternate title: Mental Health Bleg.

    The same people who were wringing their hands before the 2016 election (will Trump accept the result? This would chip away at the foundation of our democracy!), turn on a dime on the day after the election to try to oust him by extra-democratic means and have stayed relentlessly on point collecting impeachment arguments from Day One. This nothing more than the sophisticated class’s version of “Lock her up” and every bit as stupid.

    “We must hurry up and impeach Trump before the next election in 13 months for the sake of democracy” is breathtakingly laughable. It also tells me the Dems don’t think they’re gonna win next year. And why would they, given the batshit careening to the hard left by Democrats lately.

  3. Gravatar of Jeremy Jeremy
    25. September 2019 at 12:56

    @Brian: Alternative title for your comment: “Who cares about rule of law??”

  4. Gravatar of Justin Justin
    25. September 2019 at 13:12

    Anyone who thinks Trump will be impeached in the next three months should be long. You’ll get rich! Or at least make a quick buck.

  5. Gravatar of Fred B Fred B
    25. September 2019 at 13:43

    I’m not going to pile on here. I’m just going to drop you from my RSS feed.

  6. Gravatar of Brian Donohue Brian Donohue
    25. September 2019 at 13:45

    @Jeremy, the impetus to impeach started on the day after the election. Nobody is standing on principle here.

    The latest supposed impeachable offense is premised on the idea that Trump is trying to take Biden out. Have you been following the news? Poor Joe ain’t up for it, he doesn’t wanna do it, he gets 30% of Dem primary voters just by having a pulse and not being a crazed lefty. The day he drops out will be a blessing to those of us who hope the Dems might still come up with a Clinton/Obama type.

  7. Gravatar of Brian McCarthy Brian McCarthy
    25. September 2019 at 13:54

    Dilbert cartoonist-turned Trump whisperer Scott Adams has been arguing that society is currently broken down into two groups “watching different movies on the same screen.”

    He contends that human beings are inherently vulnerable to cognitive-dissonance induced hallucinogenic states, and that the best way to check as to whether our cognitive filter on a given situation is reflective of reality or a simulation is to grade its predictability.

    If you can predict the next scene in the movie with some degree of accuracy then it’s likely your filter is reasonably reality-based. Persistent failure to predict what comes next, on the other hand, is a likely sign of cognitive dissonance.

    Watchers of Movie One predicted:

    • Trump would lose
    • If he won, the stock market would crash
    • He’d never get a big tax cut passed
    • He colluded with Russia
    • He’d fold like a cheap suit on China trade

    Watchers of Movie Two predicted:

    • Trump would win
    • If he won, the stock market would rally
    • He’d get the tax cut passed
    • “Russia collusion” was a nothingburger
    • He wouldn’t make a “fake deal” with China

    I’m afraid, professor, that you are watching the wrong movie. Evidence of your hallucinogenic state with regards to President Trump is starting to call into question the credibility of your work on a larger scope.

    I say with respectful regard for your economic contributions that you really should stop opining publicly on domestic politics for a while.

  8. Gravatar of msgkings msgkings
    25. September 2019 at 14:00

    @Brian: I agree Biden is too damn old, but if he drops out it’s Warren all the way, and Trump is re-elected. The Obama type in the race is Beto, and he’s not getting anywhere. He should have waited a bit, run for Senate first (like….Obama did)

    And while yes the usual crazies on the left were all about impeachment from day one (like the crazed righties were with Obama), the adults like Pelosi were very much against it all along. Until now, because this Ukraine thing is just so embarrassingly, obviously impeachable Enough is enough. Trump was never suited to be president, and a total scumbag is exactly who should be impeached. Not because the Dems lost, because Trump is awful.

    And no, the Senate won’t convict, and yes the impeachment will probably help re-elect Trump at the margin, but at this point I can’t blame Pelosi for figuring there’s not much choice.

  9. Gravatar of Christian List Christian List
    25. September 2019 at 14:06

    I think an impeachment show now is a rather stupid decision for several strategic reasons on its own.

    The whole story already damages Biden, which helps Warren a lot, so Warren can win now, which would be a blessing for Trump.

    And even if Biden wins, thanks to the Democrats and their impeachment ado, the story about his son will always stay alive. Another blessing for Trump. He then has the same narrative as in the last election, he just replaces crooked Hillary with crooked Biden.

    “will of the people” is being thwarted

    The will of the people is being thwarted in the sense that the parliament is delaying a decision about Brexit over and over and over again. And since a few months they are even blocking re-elections. So yes, the will of the people is being thwarted.

    @Brian McCarthy
    I also support Trump here and there, but if you were really neutral, you would immediately recognize your clear sample bias. It’s easy to filter out suitable examples for each “movie”. Don’t be so ridiculous.

  10. Gravatar of Brian Donohue Brian Donohue
    25. September 2019 at 14:07

    Yeah, Pelosi has been taking fire from the left but, until now, she continued to understand the political calculation. She is obviously protective of Dems in swing districts, she understands how important it is for Dems to hold on to those seats in order to hold on to the House.

    Lefties from “safe” seats like AOC don’t understand this at all. They think impeachment is a political winner. Obviously, because as a means of removing Trump, it’s stillborn.

    Maybe Nancy’s just tired of fighting the left. They are relentless.

  11. Gravatar of Brian McCarthy Brian McCarthy
    25. September 2019 at 14:24

    @Christian List: examples or hallucinations by Trump-supporters?

    Cuz I have a ton more off the top of my head: Flynn flipped! Cohen flipped! Mueller knows stuff we don’t know! Trump will destroy our democracy! Trump will get us into a war! All Trump supporters are racist! Trump has early-onset dementia (3 years ago)! Michael Avenatti could run for President!

  12. Gravatar of Lorenzo from Oz Lorenzo from Oz
    25. September 2019 at 14:46

    Some support for your position on this.

    The, from day one, search for reasons to impeach have poisoned the water, as the string of above comments indicate. But I always thought that The Donald was a potentially disastrous champion.

    Trying to list all Teresa May’s strategic errors would take too long. But the reality is that this UK Parliament cannot agree on any likely deal, because any deal will be a bad one, but also cannot agree on no-deal, which is actually the best exit Britain is likely to get. But they also won’t allow a new Parliament. The mess the UK is in has plenty of blame to go around.

    And yes, a yes/no question has the problem of the range of possible yes’s. But that was actually for the elected representatives to deal with, and they have done an extraordinary bad job of it all round.

  13. Gravatar of Benjamin Cole Benjamin Cole
    25. September 2019 at 15:34

    Lorenzo From Oz says the Democrats have wanted to impeach President Trump from Day One. It seems to me the impeachment talk started before the inauguration, but memories grow foggy.

    An election is a year away, and the Senate would never vote to convict anyway. No party has ever voted to impeach its own president. This makes the impeachment proceedings look like another political charade, like the last impeachment proceedings.

    Worse, at least for the Democrats, is that Joe Biden’s son was getting $600,000 a year, for five years in a row, from a Ukrainian gas company while Joe Biden was the point man for the Obama Administration on Ukrainian policies. As the establishment media so quickly points out, there was nothing at all illegal in what Joe Biden’s son was doing.

    For many Trump supporters, that is the point. There is a globalist establishment that pretty much calls the shots in Washington, and it is entirely legal and entirely money-soaked.

  14. Gravatar of Michael Sandifer Michael Sandifer
    25. September 2019 at 16:21

    These are very reasonable comments.

    In case it makes people feel better about Biden, here he is being very sharp discussing foreign policy with the Council on Foreign Relations:

  15. Gravatar of Bob OBrien Bob OBrien
    25. September 2019 at 16:56

    Trump asks the president of Ukraine to do him a favor and investigate the possibility that an American citizen has a corrupt relationship with a Ukrainian company. I fail to see why this is wrong or illegal. Don’t countries normally cooperate with each other to investigate corruption?

    The fact that the American citizen is the son of the Vice President makes the possibility of corruption even more important to investigate. We do not want other countries to influence our government by payoffs to the sons of American politicians. I think this is a bigger problem than just Ukraine and Biden.

  16. Gravatar of Tom Brown Tom Brown
    25. September 2019 at 17:07

    Well they had a referendum to “determine the will of the people.” So now to maximize direct communication of the “people’s will” parliament should pass a law that any specific Brexit plan should be put up for an up or down vote by referendum. 😆… Of course that would mean every plan would be voted down because the maximum number of Brexiters that could support any specific plan would amount to no more than 35% of the electorate.

  17. Gravatar of Daniel Brannon Daniel Brannon
    25. September 2019 at 17:59

    It is amazing the lengths people will go to justify obvious misdeeds and/or muddy the waters when a politician (politician!) they support is behind it. Motivated reasoning to the extreme…

    As a proud independent voter I say the slithery bastard!

  18. Gravatar of Dan B Dan B
    25. September 2019 at 18:00


    As a proud independent voter I say IMPEACH the slithery bastard!

  19. Gravatar of Cameron Blank Cameron Blank
    25. September 2019 at 18:06

    At present the general hatred of Trump’s personality and behavior (almost) balances the general fear of the democratic party’s move to the left. If Trump is removed republicans are the clear voter favorite while if Trump stays democrats will continue to have 2018-like success.

    If Trump wins in 2020 Republicans will likely continue to bleed seats in the house and senate, lose state legislatures, lose governer seats, etc. etc. until 2024. Add in a recession and 2018 might look minor by comparison.

    If Trump loses Republicans will most likely start to win back seats in 2022 leaving The Democrat nominee with a short period of time to be legislatively productive and that’s assuming they can take the senate in 2020.

    Once again, the absolute best hope for us pro-market/anti-“social justice” folks is for Trump to lose and never be heard from again. Hey, at least we got some deficit financed tax cuts and mercantilist trade policy! It’s amazing how much better off would republicans be from a policy AND electoral perspective if Clinton had won in 2016.

    Okay, I’m obviously assuming a lot here, but why are voters going suddenly start favoring Trump and republicans when they haven’t already? Is the unemployment rate going to go to 0%? Is the Berlin Wall going to fall again? 43% is simply peak approval for Trump. Reagan had a similar approval rating when unemployment was 10%!

  20. Gravatar of Benjamin Cole Benjamin Cole
    25. September 2019 at 18:07

    Add on:

    First, let me say both US political parties completely soaked in hypocrisy, as is Trump.

    Second, the Donks have said they should impeach Trump since, or before, Day One. I guess that was just posturing. They did not do anything. Nothing happened, no matter how cuckoo Trump acted.

    But then!

    Trump went after Joe Biden’s son, and the $600,000 a year in slush money from Ukraine into Biden family coffers. Trump is threatening the mother’s milk of politics–the payoffs! The legal bribes, the slush money, the cushy travel packages, the paid-for access, the inclusion on lucrative deals.

    That is a bridge too far!

    Trump must go!

  21. Gravatar of Cameron Blank Cameron Blank
    25. September 2019 at 18:18

    In response to the Ukraine phone call, i’ll just say I never thought much would come out of the Mueller investigation, but this seems more significant, in part because it’s moving so much more quickly. The length of the Mueller investigation raised expectations too high even though the report looked pretty bad for Trump.

    Betting markets have also moved significantly and that is during a period when Warren, a weaker candidate than Biden, has seen her odds rise dramatically.

  22. Gravatar of Michael Sandifer Michael Sandifer
    25. September 2019 at 18:39

    Bob O’Brien,

    Are you really unaware that it’s illegal for a President to order a criminal investigation? And then, you have no problem with a President requesting that a foreign government investigate his most likely election rival? You’re serious?

  23. Gravatar of Michael Sandifer Michael Sandifer
    25. September 2019 at 18:47

    Bob O’Brien,

    And it apparently doesn’t occur to you that Trump doesn’t have the right to make contingent, the funds Congress allocated for Ukraine.

  24. Gravatar of SV SV
    25. September 2019 at 18:53

    It’s rich that the people concerned with Biden’s son undeserved board seat don’t utter a peep when the President and his sons profit from foreign diplomats staying on his properties and diverting armed service personnel to stay at his golf courses

  25. Gravatar of ssumner ssumner
    25. September 2019 at 19:39

    Everyone, Yesterday I post on monetary policy at Econlog and there are zero comments 24 hours later. Today I do a throw away post on Trump and the comment section fills up with idiots who wouldn’t understand corruption if it was 2 inches in front of their nose. And people complain I don’t post enough on money.

    I know. What’s wrong with holding up military aid to the Ukraine in an attempt to get the corrupt government there to smear the biggest threat to Trump’s re-election? Nothing to see here folks, just move right along.


    I do agree with Christian on one point. It’ll probably work. The Dems will take the bait and hand Trump the election by nominating Warren instead of Biden.

    A corrupt party and a stupid party. Decisions, decisions . . .

    BTW, Trump was committing impeachable offenses almost from day one. That’s why people like me starting calling for impeachment almost from day one.

  26. Gravatar of Bob OBrien Bob OBrien
    25. September 2019 at 20:40

    “…idiots who wouldn’t understand corruption if it was 2 inches in front of their nose.”

    If a Vice President uses US resources to force a foreign leader to fire someone investigating his son then yes, this is potential corruption within 2 inches of everyone’s nose! Those who do not see this are the idiots!

  27. Gravatar of Bob OBrien Bob OBrien
    25. September 2019 at 20:53

    “Everyone, Yesterday I post on monetary policy at Econlog and there are zero comments 24 hours later. Today I do a throw away post on Trump and the comment section fills up…”


    I try to read all your econ posts. I learn a lot from them and really appreciate the time and resources you put into them. Thank you. I don’t comment very often because I just don’t know enough econ to make an intelligent comment most of the time.

  28. Gravatar of paul paul
    25. September 2019 at 21:36

    Evaluating a vote by percent eg 52% rather than a measure that includes sample size like sigma is a big statistical mistake.

  29. Gravatar of xu xu
    25. September 2019 at 22:43

    You have studied economics for 40+ years and you fail to grasp most economic concepts, so it is not surprising that people don’t respond to those posts. You, like most academics, have this misplaced pride which makes it extremely difficult for you to admit your wrong. In summary: you are a dinosaur, your research is largely irrelevant, and you are mostly wrong.

    In regards to Trump post – obviously the word “favor” is a not a quid pro quo. The word favor is often used in sales as a really polite way of asking someone to do something for you. It does not guarantee anything in response. Biden, however, did exchange foreign aid for a favor. He also received 1 Billion from China after visiting (conveniently deposited in his sons hedge fund). These are important facts you fail to mention.

    It is a great thing you never became an attorney because your logic is just awful……

    really, really, awful!

  30. Gravatar of ChrisA ChrisA
    26. September 2019 at 01:27

    I think there is an interesting link between the UK court case and this recent latest problem for Trump. Both of them show more evidence for the “deep state” hypothesis, where the deep state or establishment in older words is trying to overturn what was previously considered part of politics. It could be seen as a dangerous thing – the deep state is now being strong enough that it doesn’t care to hide. Or it could be seen as good trend, the deep state is losing control and so is having to be more overt. In any event, both these events could end up strengthening Johnson and Trump. In Johnson’s case when the election finally happens he will be able to run as the insurgent candidate, and remember the Brexit favoring parties still hold a majority in the electorate. In Trump’s case the issue the democrats are fighting on seems weak – Trump is pointing to what appears to be corruption by Biden and the establishment is trying to prevent this being exposed.

    If both Trump and Johnson win their elections by large margins it will be interesting how they will tackle this deep state problem. I would guess that in the UK the supreme court (a very recent innovation) and the supremacy of the parliament over the courts be affirmed. In the US, perhaps the CIA/FBI and the other intelligence gathering agencies could be significantly reformed and there powers significantly weakened.

  31. Gravatar of Benjamin Cole Benjamin Cole
    26. September 2019 at 02:15

    Scott Sumner:

    I commented on your EconLog post. But my comments on EconLog are being held, I do not know why. They sometimes appear the next day, sometimes not.

    I know how much you look forward to my commentary.

  32. Gravatar of Ewan Ewan
    26. September 2019 at 02:44

    Help a poor foreigner.

    Why is a serving Vice President threatening the President of a foreign state unless he closes an investigation into fraud at a company the VP’s son profits from not cause for comparable concern?

    And how can people still quote Mueller as if his report and testimony are not an embarrassment?

    Surely there have to be watertight reasons out there for impeaching such as President Trump? Russiagate and Ukrainegate are just symptoms of the decay of the Democrats.

    And whose idea is it to publish confidential conversations with foreign officials, who will now feel entirely confident in holding frank discussions with US officials?

  33. Gravatar of bill bill
    26. September 2019 at 03:31

    Holding back the whistle blower report in and of itself should be enough, here and now. The law is clear on that. So now we have proven Snowden right and basically have a system where all whistleblowers feel obligated to go to the press FIRST. The system has to be trustworthy. Also, if you got caught embezzling, you are still in trouble even if you give back the money. Congress can’t be forced to commence impeachment proceedings every time Trump breaks the law. Presumably the complaint is about him using taxpayer funds for his own benefit, and using them in a way that violates our election laws. But undermining our intelligence community by eviscerating the whistleblower process may be more detrimental to our country. And the less he’s hiding now, the more egregious an affront this is.

  34. Gravatar of bill bill
    26. September 2019 at 03:33

    Bob O’Brien,
    If Biden did what Trump alleges and that is against the law, yes, bring Biden to trial too.

  35. Gravatar of Bob Bob
    26. September 2019 at 06:43

    Totally agree. I was never a fan of Pelosi, but she has proven to be the right person for the these times. I’m glad I was wrong about her.

    Your post is a laughable display of your filter. I’m a watcher of movie one and you have not successfully guessed my predictions. See below.
    “Watchers of Movie One predicted:

    • Trump would lose – I did predict this but not with high confidence
    • If he won, the stock market would crash – I did not predict this one way or the other
    • He’d never get a big tax cut passed – I did not predict this
    • He colluded with Russia – He tried to collude with Russia and he did obstruct justice. Now he is colluding with Ukraine.
    • He’d fold like a cheap suit on China trade – I predicted he would enter into stupid trade wars and lose, which is exactly what is happening.

    In addition, I predicted that he would:
    – fail to repeal Obamacare
    – destabilize the middle east
    – fail to improve the Iran deal
    – destabilize Asia either through Taiwan or Korea
    – be impeached

    The one prediction I was wrong about was that I expected Republicans in Congress to stand up to him more than they have.

  36. Gravatar of Tom Brown Tom Brown
    26. September 2019 at 08:44

    This is from a Trump supporter. Someone who sent him money to get re-elected. And yet even he can see there’s nothing to the right’s Biden Story:

  37. Gravatar of Tom Brown Tom Brown
    26. September 2019 at 08:50

    Here’s another one from Trump supporter Erick Erickson. I’ve never seen him so frustrated with Rudy… Lol, he really goes off on him here, and his ilk:

  38. Gravatar of Michael Rulle Michael Rulle
    26. September 2019 at 10:31

    “a man sees what he wants to see and disregards the rest”

    Me too I suppose. But while it is easy for me to understand why individuals like or dislike a President, it is much harder when the reasons for the dislike are based on supposed illegalities committed. Trump did the opposite of filming himself shooting a guy in Times Square. He filmed himself in Times Square when a shooting was supposed to have been committed—-and all we saw was Trump walking down the street—maybe mocking some people along the way—but no shooting.

  39. Gravatar of Sean Sean
    26. September 2019 at 11:23

    Doesn’t the US have a vested interest in finding out if a foreign government was bribing the son of the VP of the United States? Essentially that is what the natural gas company was doing.

    Also this is horrible timing. The Dems lack a realistic candidate. Anything that would get Sanders/Warren into the White House is worse than Trump.

    Biden would be ok. Kinda too old to be a rock-the-boat type.

    While I think the world is moving to a winner-take-all economy and something needs to be done..a Wealth Tax would cause a lot of problems

  40. Gravatar of Christian List Christian List
    26. September 2019 at 12:19

    Changes of perspective seem to be en vogue. All right, let’s try it:

    Imagine a Democratic President named Biden and a Republican ex-Vice President named Trump with a son named Hunter. Trump was the former president’s special envoy for Ukraine, during which time his son is hired by a Ukrainian gas company and collects $50,000 a month. The son’s experience in the gas business is zero, no one knows what the son earns $50,000 a month for. But luckily father and son assure us that all this has nothing to do with the political position of the father.

    Then an important public prosecutor is fired. The prosecutor claims he was fired because Trump senior was in Ukraine demanding his removal because he was investigating the gas company and his son. Trump senior admits that he was in Ukraine demanding the removal of the prosecutor but that all this has nothing to with his son or the gas company.

    President Biden is a political competitor of Trump and repeatedly asks the Ukrainian president to take a close look at the matter, in the hope something useful can be found that might help him in upcoming campaign against Trump.

    The GOP hears from this “scandal” and initiates an impeachment procedure against President Biden hoping that this will bring great advantages in the upcoming election campaign Biden vs. Trump.

    Good luck with that!

    P.S. President Biden is an election campaign genius who is a master at framing such events. He has just survived a critical investigation by a man named Mueller (“toughest in the field”) without any lasting damage, although the partisan GOP-loving media outlets have claimed the opposite for months.

    Then a candidate named Pocahontas enters the field, who considers herself Native American because she might have had a Native American ancestor 8 generations ago. And this ingenious candidate wins the presidency with the campaign themes Open Borders, Green New Deal, national socialism, free universities, and free health care for all. Did I mention that she rides a pink unicorn? Keep on dreaming guys, keep on dreaming. Whatever you smoke, it must be the really good stuff.

    On the other hand: The 2016 election was already so weird, that nothing, absolutely nothing can be ruled out anymore.

  41. Gravatar of LC LC
    26. September 2019 at 12:40

    OT, Scott what’s your view on the gyrations in the repo market recently? There are 2 recent columns in Bloomberg (1 by Kocherlakota) that imply there are deeper liquidity problems and basically there aren’t sufficient domestic US savings to absorb all the debt US government has issued. If so, will this be the black swan event that brings the next crisis?

  42. Gravatar of ssumner ssumner
    26. September 2019 at 13:47

    Everyone, If you get you info from nutty right wing conspiratorial websites and present it here as facts, don’t expect the rest of us to take you seriously.

    Bob and Ewan and Sean, If a VP did something like that it would be really bad. Fortunately he did not.

    Paul, Sample size???? We are talking about an election! It’s not a “sample”.

    Xu, I feel sorry for people like you, unable to enjoy classic films like The Godfather.

    ChrisA. Deep state? Please don’t insult my intelligence. The Inspector General is a Trump appointee.

    Bill, Yes, and today Trump compared the whistleblowers to “spies”, and referred to how they dealt with them in the old days. Really strengthens the whistleblower protection law, doesn’t it?

    LC, No.

  43. Gravatar of Matthew Waters Matthew Waters
    26. September 2019 at 13:54

    At least the pro-Trump people, here and elsewhere, explain how authoritarian regimes happen. You look from outside and it’s nuts. IKEA tried to have a store in Russia without using any bribes and pulled out once an official asked for permit in case of “hurricanes.” Hurricanes. In Russia.

    But if enough supporters have an authoritarian mindset, they will justify any conceivable action. If offering Ukraine with the AG’s help in investigating Trump’s political opponent, using the clear promise of $400 million in aid withheld, what in the world *is* the possible line? Trump intimated this morning that he wished the whistleblower was jailed or executed. Would that cross the line or is the whistleblower insubordinate deserving of punishment?

  44. Gravatar of Matthew Waters Matthew Waters
    26. September 2019 at 13:58


    It isn’t a black swan event. Reserves are held up because the largest banks have to have enough reserves under Basel III in case they go insolvent. When debt to equity is crammed down in the “bail-in” procedure, they need enough reserves for outflow.

    The quantity of reserves, in addition to interest on reserves, is how the Fed targets Fed Funds rate at all. Primary Dealer repos with New York Fed were common before the crisis and so it’s no surprise policy eventually got “normalized” enough to need them again.

  45. Gravatar of Christian List Christian List
    26. September 2019 at 15:35

    The case reminds me of the Mueller investigation, in which the other side told us for years that Trump was finished, basically already in prison.

    Will it take another two years in which Trump laughs himself to death, or will things go faster this time?

    I think it has more to do with the fact that too many left-wing voters seriously consider themselves impartial when in reality they are as biased as others, and incapable of changing perspectives.

  46. Gravatar of paul paul
    26. September 2019 at 15:48

    Hi ssumner,

    > Paul, Sample size???? We are talking
    > about an election! It’s not a “sample”.

    52% of vote from 100 votes is less than half sigma. Not significant preference.

    52% of vote from ten million votes is over a hundred sigma.

    For Brexit there were 33 million voters.

    ((17,410,742) – (33,551,983 / 2)) / sqrt(33,551,983 * .519 * .481) = 219

    The preference for Brexit is huge.

    I love your economics posts, they make me think and help me learn this interesting discipline.

    Thank you

  47. Gravatar of Matthew Waters Matthew Waters
    26. September 2019 at 15:55

    – Trump fired an FBI director to stop an investigation into Flynn and “the Russia thing.”
    – McGahan was ordered to fire Mueller. There was not a Saturday Night Massacre only because McGahan waited out executing the order.
    – Trump held up $400 million to Ukraine. Asked for a “favor” after Ukraine president requested more Javelins. You have to be extremely, unbelievably credulous to think the Biden investigation was not in addition to the Crowdstrike thing (which was itself a completely nuts, fact-free conspiracy).
    – Trump offered Bill Barr to help in this investigation of his political opponent.

    I’m old enough to remember when Clinton meeting Lynch on the tarmac was considered a huge issue. I’m sure you’ll have piles of wrong conspiracy theories. Everybody, in US and Europe, wanted that prosecutor gone, not just Biden. The investigation into the energy company was not ongoing. When those facts are disproven, there will be just more or different conspiracy theories.

  48. Gravatar of Benjamin Cole Benjamin Cole
    26. September 2019 at 19:07

    Matthew Waters:

    Everything you say it probably true.

    On the other hand, it looks rotten for Hunter Biden to get $600k annually from a Ukrainian gas company while his father is point man on Ukraine.

    Beyond that, why is the US getting entangled in the Ukraine? Not enough food on our plate in Syria, Libya, Iraq, Iran, Afghanistan, Mali, Venezuela, Honduras, Mexico, Korea, China and Russia? BTW, I think Putin is thug, and so is Xi.

    Why is this $600k annual slush-fund gravy-train to the Bidens not getting more notice?

    I guess because 1) to the establishment, nothing seems out of place in the Bidens getting $600k a year from foreign interests, and 2) that seems like a small sum of money to most Donks and GOP’ers in office.

  49. Gravatar of E. Harding E. Harding
    26. September 2019 at 20:28

    “I do agree with Christian on one point. It’ll probably work. The Dems will take the bait and hand Trump the election by nominating Warren instead of Biden.”

    No; Warren will win at least 300 EV, and it won’t be particularly close. Get your head out of your ass, Sumner, Trump is not popular.

    Trump’s remarks were untoward, but in no way constitute high crimes and misdemeanors.

    The reason we don’t comment on your econlog posts is bdcause we’re banned from there.

  50. Gravatar of Benjamin Cole Benjamin Cole
    26. September 2019 at 21:26

    Here is comment on Sumner’s last Econlog post:

    I hate to mention this, but….Europe has rules on how much fiscal stimulus is allowed, I think a max of 2% of GDP for any nation….

    Japan is decreasing budget deficits in relation to GDP….Scott Sumner has described Japan-Europe as in deflationary, negative interest rate doldrums…and perhaps monetary policy is too tight…

    The US is running trillion-dollar national budget deficits and has stayed out of negative interest rates and deflation….

    The annoying question persists: How does a lone central bank increase demand within the geographic confines of a given nation? 

    The US central bank can take a stab of lowering interest rates but longer tern rates seem to be set globally…

    and the Fed can buy bonds on global asset markets, in which money is a fungible commodity….but how does that generate demand inside the US? 

  51. Gravatar of Benjamin Cole Benjamin Cole
    26. September 2019 at 21:31

    A fascinating report from some guy affiliated with the Swiss National Bank…calls for the separation of credit and monetary policies….

    If the only way to implement monetary stimulus is through credit channels…you get mounting debt and weak stimulus?

  52. Gravatar of P Burgos P Burgos
    26. September 2019 at 21:41

    “I’ve never been a fan of Nancy Pelosi, and did not agree with her reluctance to impeach Trump. So today I need to grudgingly give her credit. By waiting for a smoking gun, she made the process seem less partisan.”

    Since no one else brought this up, I couldn’t let it go. Pelosi has now twice been Speaker of the House. I find it very difficult to believe that there are more than a few dozen people in the world who know US politics (and US electoral politics) better. Probably Mitch McConnell, but no one else springs to mind immediately. So you would need some really strong priors to think that Pelosi is making a mistake by not pressing for impeachment when she pointedly refuses to do it.

    And also, for you Trump supporters, you should also be questioning why Pelosi seems to be in favor of impeachment over this. Protest all you want about how this isn’t about principle, but then stop a moment and think. If it isn’t about principle, then it is about electoral advantage. And Nancy Pelosi isn’t stupid, especially about politics (unlike say Paul Ryan, who thought that tax cuts for the rich and social security privatization were winning issues in elections). It will be interesting to see how McConnell handles this.

  53. Gravatar of Steve Steve
    27. September 2019 at 01:16

    Ben Cole is right.

    The DNC and the Obama White House both asked Ukraine for assistance in going after Trump and Manafort during a presidential campaign.

    You might say Manafort is a crook, so it’s ok, right?

    Now the shoe is on the other foot. Biden is a crook and that is the only thing that matters. Three million dollars for a know-nothing coke-snorter to sit in a conference room a few times a year over five years?

  54. Gravatar of Becky Hargrove Becky Hargrove
    27. September 2019 at 03:42

    I couldn’t help noting however, this isn’t really a “nutty right wing conspiratorial website”.

  55. Gravatar of Randomize Randomize
    27. September 2019 at 07:23

    The president of the United States used $400M taxpayer dollars to bribe the Ukrain into investigating his political opponent. Either by resignation or in chains, it’s time for him to go.

  56. Gravatar of LC LC
    27. September 2019 at 07:39

    @Matthew Waters, thank you.

  57. Gravatar of ssumner ssumner
    27. September 2019 at 16:33

    Paul, I think you are confused. An election is not a public opinion poll. The views of the non-voters DON’T MATTER. The confidence is 100%.

    Ben, Of course Biden’s son looks sleazy. But it’s also sleazy to lie about Joe Biden, as Trump does every day. Biden’s son doesn’t matter any more than Trump’s idiotic son or Jimmy Carter’s idiotic brother.

  58. Gravatar of Christian List Christian List
    27. September 2019 at 19:54

    Biden’s son doesn’t matter any more than Trump’s idiotic son or Jimmy Carter’s idiotic brother.

    Somehow I strongly doubt that you would write something like this if Trump junior would cash in $50,000 a month for no qualification, except being the son of a very powerful politician. Is this your TDS taking over again?

    Also: the criticism is mainly related to the fact that Biden knew exactly about his son’s activities, but nevertheless did not react. The least he could have done would have been the return of his task as a pointman for Ukraine.

    He also shouldn’t take his son to China in Air Force Two, and then just a few days later, the son joins the board of a just-formed investment advisory firm with Chinese partners.

    This is about Biden directly and the things Biden did.

  59. Gravatar of Benjamin Cole Benjamin Cole
    27. September 2019 at 19:57

    Billy Beer! Hurray!

    An unrecognized genius before his time. Craft beers are huge now.

  60. Gravatar of ssumner ssumner
    28. September 2019 at 16:26

    Christian, You said:

    “Somehow I strongly doubt that you would write something like this if Trump junior would cash in $50,000 a month for no qualification, except being the son of a very powerful politician.”

    Is this a joke? You don’t think Trump Junior is cashing in on his dad being President? Trump himself is cashing in big time, and his son gets a share of that loot.

  61. Gravatar of anon/portly anon/portly
    29. September 2019 at 08:11

    “Is this a joke? You don’t think Trump Junior is cashing in on his dad being President? Trump himself is cashing in big time, and his son gets a share of that loot.”

    This surprised me, as I’m not at all sure what you’re talking about, so I googled and found this article from a year ago:

    This article says his net worth has actually gone done quite a lot. I’ve always wondered if he’s really as rich as Forbes says he is, but I guess he must be.

  62. Gravatar of anon/portly anon/portly
    29. September 2019 at 08:15

    Maybe this Bloomberg article from June is better. They say his wealth is basically unchanged:

  63. Gravatar of anon/portly anon/portly
    29. September 2019 at 08:18

    That’s confusing. I linked to a Forbes article from October 2108 that claimed Trump’s net worth had fallen quite a bit, but apparently I mis-posted. The “better” in the above post referred to that unposted comment.

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