Another Bharara Conviction Overturned

June 22, 2017 at 2:19 pm

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When Preet Bharara was Manhattan's U.S. attorney, he prosecuted precisely one case in court himself. His team won the case at the time, but a district court judge just vacated one of the convictions...

The current case involves John Pauling, who had been charged with intent to distribute 100 grams or more of heroin. The district court judge, J. Paul Oetken, ruled that the prosecutors used misleading charts (which showed Pauling selling more heroin than they proved at trial), that they did not disclose those charts to the defense beforehand, and that they did not offer adequate proof of the charge, relying instead on speculation.

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Preet's Book Deal

June 22, 2017 at 1:50 pm

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Preet Bharara, who had more than a half dozen of the insider trading convictions he won overturned or dismissed after an appellate court found that the legal theory they were brought under was unfounded, now has a book deal with Knopf about "integrity" and "moral reasoning" to go along with his post as "distinguished scholar in residence" at NYU Law School.

I'm looking forward to reviewing that book. Maybe some enterprising editor will ask one of Mr. Bharara's victims — like Michael Steinberg or David Ganek — to write a review. So far I haven't seen any word about how much money is involved in the advance, but if it is significant, it's worth thinking about the commercial incentives involved for a prosecutor who can cash in after overreaching by bringing criminal cases that weren't warranted.

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Regulation and the D.C. Housing Crunch

June 22, 2017 at 1:26 pm

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Read the New York Times carefully enough and it's practically a textbook of free-market economic principles. Yesterday it was explaining how unintended consequences and perverse incentives in health insurance and drug treatment regulation are contributing to an opioid epidemic. Today the newspaper explains why housing prices are soaring in Washington, D.C.:

growing demand has not been matched with a supply of new homes. A combination of zoning rules and height restrictions in the city limit the developers.

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Insider Trading's Legality Problem

June 22, 2017 at 1:03 pm

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Miriam Baer, a professor at Brooklyn Law School who served as an assistant U.S. attorney from 1999 to 2004 in the Southern District of New York, has a fine article in the Yale Law Journal headlined "Insider Trading's Legality Problem." It echoes and expands on some of the themes we have raised here in the past about the problems of insider trading law being devised (alternative Russell Conjugations: invented, improvised, made up out of whole cloth) by courts rather than Congress. Highlights:

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Russell Conjugation

June 22, 2017 at 12:45 pm

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Eric Weinstein has an interesting post about Russell Conjugation:

most words and phrases are actually defined not by a single dictionary description, but rather two distinct attributes:

I) The factual content of the word or phrase.
II) The emotional content of the construction.

Where words can be considered "synonyms" if they carry the same factual content (I) regardless of the emotional content (II). This however leads to the peculiar effect that the synonyms for a positive word like "whistle-blower" cannot be used in its place as they are almost universally negative (with "snitch," "fink," "tattletale" being representative examples)....

He gives firm/obstinate/pigheaded as another example. Or estate tax and death tax. Or "illegal aliens" and "undocumented immigrants."

He writes:

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Michael Bloomberg on Trump

June 22, 2017 at 12:31 pm

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Mayor Bloomberg is going through one of his more sensible phases, at least on the recent evidence.

ABC News reports:

Former New York City Mayor Michael Bloomberg said America should "get behind" President Trump because "the public has spoken, whether you like the results or not...We have an election — whoever wins, you got to get behind."

"He's our president, and we need this country to be run well. I didn't vote for him," Bloomberg added. "Let's just all hope that Donald Trump is a good president of the United States."...

But Bloomberg said people should still fight policies they don't agree with.

"You can protest. You can elect other officials, write letters, make phone calls," he said. "But in the end, the public has spoken, whether you like the results or not."

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Two Looks at the Resistance

June 21, 2017 at 2:38 pm

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In the Wall Street Journal, Holman Jenkins writes a column headlined "Anatomy of a Witch Hunt":

as a colleague once said of Stalin, "[He] tries to force life into a ready-made framework. The more life resists . . . the more forcefully he mangles and breaks it."

Come to think of it, that's not a bad way of describing how the D.C. anthill has reacted to the unexpected, exotic, high-risk, possibly providential experiment of the Trump presidency.

We mean every descriptor. His very unsuitability, the mood of the American public that elected him, the obscure impasse of American politics that brought him to power—all these signs deserve more respect than they're getting.

His Torquemadas don't and can't know whether our democracy, in the improbable Mr. Trump, found a lever to move us forward, but there's something repugnant in their desire not to find out.

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Mass. Millionaires Tax

June 21, 2017 at 1:39 pm

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The online homepage of today's Boston Globe provides a textbook example of bad journalism with its coverage of a proposal to increase the Massachusetts state income tax.

Ironically, the headline comes over a more thorough, balanced, and nuanced article by Michael Levenson, who from what I can tell is one of the Globe's stronger players these days.

It begins with an on-the-record quote from Richard J. Valentine, who says he "might move to Florida rather than pay the new tax."

It reports: "New Jersey estimated that 25,000 residents who would have paid $150 million in income taxes per year left the state in the seven years following its tax increase on high earners."

It reports:

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Unintended Consequences, Again

June 21, 2017 at 11:43 am

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From a front-page New York Times article about drug-treatment centers in Florida that are making money by...well, let the Times itself explain it:

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Hillary 2020 and Mueller-Trump-Russia

June 20, 2017 at 1:27 pm

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Robert Mueller's investigation of Russian influence in the 2016 presidential election is both a forerunner of Hillary Clinton's 2020 campaign and a replay of the insider-trading prosecutions of the past decade, I write in my column this week. Please check the column out at the New York Sun (here), Reason (here), and Newsmax (here).

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David Brooks on Trump-Russia

June 20, 2017 at 1:01 pm

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Excellent David Brooks column today about President Trump and Russia:

There's just something worrisome every time we find ourselves replacing politics of democracy with the politics of scandal. In democracy, the issues count, and you try to win by persuasion. You recognize that your opponents are legitimate, that they will always be there and that some form of compromise is inevitable.

In the politics of scandal, at least since Watergate, you don't have to engage in persuasion or even talk about issues. Political victories are won when you destroy your political opponents by catching them in some wrongdoing. You get seduced by the delightful possibility that your opponent will be eliminated. Politics is simply about moral superiority and personal destruction....

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Ivanka Trump Paid Parental Leave

June 20, 2017 at 12:51 pm

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Ivanka Trump is on Capitol Hill today meeting with senators to discuss how to incentivize businesses to offer more paid parental leave, perhaps using tax dollars. As is often the case, government trails behind the private sector on this sort of thing, a point that was driven home for me by a full-page ad in Sunday's New York Times from a founder of Harry's, which is a mail-order shaving supply company:

we're excited to offer a new, progressive policy: 16 weeks of equitable paid parental leave, taken any time within the first year, to every person on our team. That applies to men, women, transgender, birthing parents and non-birthing parents.

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Federal Judge Faults Justice Department on FBI Leak Case

June 19, 2017 at 10:54 am

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A federal judge in Manhattan is faulting the Justice Department for failing to obey his order to provide updates on its criminal investigation into the FBI's leaks to the press of information in an insider trading case.

In an order dated June 16, 2017, Judge P. Kevin Castel of U.S. District Court for the Southern District of New York writes, "In the case before this court, a supervisory special agent of the Federal Bureau of Investigation leaked grand jury information to journalists without authority to do so." The judge noted that a knowing violation of the rule against leaking grand jury materials is punishable as contempt of court. Judge Castel had ordered the updates on the criminal investigation into the leaks, but complains in his order that the latest update doesn't meet his standards.

The judge writes:

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Laffer on Drug Prices

June 19, 2017 at 9:56 am

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Arthur Laffer, responding to reports that the Trump administration is readying some kind of executive action on pharmaceutical pricing, suggests in a Bloomberg View column:

As an alternative, Trump could use his deal-making skills to negotiate voluntary pricing restraints in the drug industry. Such restraints would reduce the distortionary effects that inevitably result when the government forces specific cost-control measures in areas that may not be the most efficient places to cut costs. Instead, voluntary pricing restraints would enable individual companies to determine the most effective ways to cut their costs to reduce aggregate drug spending....

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Al Franken on "If You Like Your Plan..."

June 18, 2017 at 11:05 am

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The New York Times' Philip Galanes interviews Al Franken, the Democratic Senator from Minnesota, who used to be a comedian:

PG To be fair and balanced about this, there is a Democratic version of this problem, too. When President Obama said, "Don't worry, you can keep your doctor ..."

AF Yup. He shouldn't have said it.

PG Was he selling or lying or just really hoping it would be true.

AF I'm not sure why he kept saying that. First of all, no one can definitely keep their insurance because insurance companies make the decision whether to offer the same damn insurance. But it was embarrassing and bad that he said it. And it opens us up to the same charges we're heaping on everyone else.

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