Showing posts with label economics. Show all posts
Showing posts with label economics. Show all posts

Monday, February 23, 2026

Learning Res., Inc. v. Trump is Like a BET Cypher, Alternatively Titled "If you rely on IEEPA I feel bad for you son, it provides 99 delegations but tariffs ain't one"

On Friday, in Learning Res., Inc. v. Trump, the Supreme Court held that the International Emergency Economic Powers Act (IEEPA) does not authorize the President to impose tariffs.  The gist of it all is the IEEPA lets the President "regulate imports" which isn't the same thing as taxing or tariffing.  Six justices agreed on this outcome, but there were two different rationales and lots of shade thrown across three concurrences and two dissents.  It was all very hiphop, as if they were in a Federalist cypher.

The cypher started with Chief Justice Roberts writing for himself and Justices Kagan, Sotomator, Jackson, Barrett and Gorsuch, applying the "major questions doctrine" (some newfangled coproma passed off as conservative jurisprudence) which says that "Congress would not have delegated 'highly consequential power' through ambiguous language. These considerations apply with particular force where, as here, the purported delegation involves the core congressional power of the purse."  This means that the party asserting that they were delegated the Congressional power at issue must "point to clear congressional authorization” in the relevant statute.  You may recall that six Justices relied on this doctrine to overrule Joe Biden's student loan forgiveness plan in Biden v. Nebraska.

Justice Kagan then got on the mic to represent herself, Sotomayor and Jackson.  They concurred, but they felt there was no need to invoke the major questions doctrine because "the ordinary tools of statutory interpretation amply support [this] result."  I am an ordinary tool and I agree with them.

Justice Gorsuch, ever the philodox, took it upon himself to get on the mic and write 46 pages (the main opinion was only 21!) bemuting upon everyone else's analysis except the Chief Justice's.  First he essentially accused Justices Kagan and Sotomayor of outcome-based reasoning, picking the winner based on their personal preference rather than a rigorous application of the law.  I'll channel the underpants gnomes and go to third, where he also essentially accused Justices Kavanaugh, Alito and Thomas of outcome-based reasoning but in a slightly nicer way (although he does linger a bit to highlight, albeit politely, the preposterousness of Thomas's dissent).

But second, and remarkably, this quibberdick spilled ink across nine pages to desticate over Justice Barrett's application of the major question doctrine in Biden v. Nebraska!  He's so irked about an opinion from three years ago that he had to drag it into this one.  We all have a guy like this at work.

Justice Barrett did not appreciate having her name on the streets.  Naturally, she channeled her inner Mad Cobra and wrote a concurrence directly addressing Gorsuch, saying "I would not treat this evidence as precedent for a judicial flex."

If you were young and alive in northern New Jersey in the summer of 1992 you undoubtedly are familiar with Mad Cobra's song "Flex."  It's more likely than not that you spent time in a car with a number of other young, alive people with the windows down and this song playing loudly.

Parenthetically, Wikipedia says "Mad Cobra stated that he was on a flight returning from New York, and was watching an exercise video on the in-flight entertainment system, and the lyrics 'How this lady flex like she want to have sex?' came to him. He wrote the lyrics for the song on an air sickness bag in his plane seat and took them to the studio when he arrived in Jamaica."

Perhaps Justice Barrett wrote the opening draft of her concurrence on an air sickness bag too.  Or maybe she's a Rich Homie Quan fan.

The mic then passed to Justice Kagan who explained her reasoning admirably but fumbled a major opportunity to flex (see what I did there?) her New York City credentials.  In explaining the various actions delegated by Congress to the President under the IEEPA, she noted there are "9 verbs listed in IEEPA's delegation provision" and "[t]hose verbs are followed by 11 objects, each describing a distinct sort of transaction involving foreign property."  She then did some fancy math and concluded "Combine the verbs and objects in all possible ways, and the statute authorizes 99 actions a President can take to address a foreign threat.  And exactly none of the other 98 involves raising revenues."  This passage clearly screams for the conclusion "If you rely on IEEPA I feel bad for you son, it provides 99 delegations but tariffs ain't one."  

Justice Jackson took to the mic to spit eight bars (just four full pages) saying that all this sniping is unnecessary because Congress's intent is clear from the legislative record.  Conservatives refuse to look at the legislative record when interpreting statutes, instead favoring dictionaries and other historical references.  That's how we wind up with "history and tradition" tests like this bunkum.  I would've said something like "Our forefathers wrote IEEPA for foreign property, the Prez can take it in wartime but not impose duties. Come here, young blood, and take a look.  Acknowledge your legislative history!"

When SCOTUS finally invites me to one of their cyphers I'll get them straightened out. 

Monday, April 14, 2025

zPSA: Donald Trump is Fucking Up

Elected Democrats have been doing a piss-poor job communicating to the American people despite the political gifts handed to them lately.  Their first instinct is always to pussy-foot around an issue, both-sides it a little bit to avoid offending anyone, and use 5,000 words when five would do.  They're also afraid of sounding crass, or being assholes, and if they ever swore it wouldn't sound authentic.

For example, Hakeem Jefferies recently offered the opinion that “Tariffs, when properly utilized, have a role to play in trying to make sure that you have a competitive environment for our workers and our businesses.  That’s not what’s going on right now. This is a reckless economic sledgehammer that Donald Trump and compliant Republicans in the Congress are taking to the economy, and the American people are being hurt enough.”

"Utilized"?  Really?  Who talks like that?  "I utilized some toilet paper to blow my nose because we're all out of Kleenex.  Good thing we had the TP otherwise I would have utilized my finger."  Sounds perfectly normal and relatable.  And more importantly, why is he providing cover for Trump's tariffs?  Why couldn't he just say "Trump's tariffs ruined the economy"?

Everyone who reads G:TB knows that I have an inordinate fondness for Cory Booker, but did he really have to talk for 25 hours to draw attention to DJ Trump's stupidity?  He couldn't boil it down to maybe 25 minutes?  Does anyone know what Booker actually said?  I don't.

Trump is fucking up and someone needs to call him out in a way that resonates with people who were stupid enough to vote for Trump in the first place.

You know what this moment calls for?  Someone who can swear and be crass authentically, for whom being an asshole comes naturally.  Like Chris Christie, only not a big fat slob who sold out to Trump and did a 180 only after being dumped from Trumpworld.

I think the Democrats need to cut an ad with someone well-known and well-respected from outside the world of politics and run it throughout the NBA playoffs.  It needs to use short, pithy sentences.  It needs to be overly reductive and devoid of nuance so that Trump and his supporters need to babble like Democrats to try to explain it away.  The ad's point needs to be clear even if you can't hear it because you're watching in a sports bar.  It should feature someone who has represented America on the world stage, who achieved major wins, and who has fucked up epically.  This person could then say "I have represented our country on the world stage.  I know a lot about winning, and I know about fucking up.  I'm here to tell you: Trump is fucking up."  And that's the theme.  Four words.  Trump is fucking up.  Bleep the "fucking" if you have to but don't blur the speaker's mouth.

Then really quickly have them say something like "The Trump tariffs tanked the stock market.  Since he took office the market is down about 9%.  That means Trump's tariffs took one out of every eleven dollars in your savings.  Trump is fucking up."  Run video of Trump talking on one side of the screen while the stock ticker plummets on the other.


They could also say "Trump promised to deport illegal aliens.  But his own lawyers admitted that they accidentally deported the wrong guy.  So the illegals are still here and the wrong guys are in El Salvador.  Trump is fucking up."  At the same time, run video of Kristi Noem rocking her ICE cap, flak vest and Daytona.


Then they conclude with "I know a lot about winning and this isn't it.  Trump is fucking up."

My first thought was Michael Phelps.  He represented the US at the Olympics, he won more than anyone ever, and he got into a bit of a jam with a bong.  So when he says "I have represented our country on the world stage.  I know a lot about winning, and I know about fucking up," the ad would run a picture of him on an Olympic podium with the flag, then a picture of him with a shitload of medals, then the photo of him and the bong.  


Everyone knows Phelps.  Many people like him, or at least respect him.  I don't think anyone hates him.  Apparently he dislikes Trump and he strikes me as having some assholery in him, but I don't know how authentically he swears.  This seems like a good option though.

My next thought was Tiger Woods.  When he says "I have represented our country on the world stage.  I know a lot about winning, and I know about fucking up," the ad would run a picture of him holding the Ryder Cup, then a bunch of iconic pictures of him with trophies and/or fist-pumping, then ... well, there are probably a lot of fucking up photos to choose from but I'll just go with his mugshot.


But Tiger is friends with Trump so he wouldn't go for this.

I was stuck after Tiger.  I ruminated and finally struck on an amazing idea.  You know who can take on a raging asshole from Queens?  Another raging asshole from Queens, one who famously swears and acts badly but won a lot and who put representing America above almost everything else. 

Like John fucking McEnroe.  Johnny Mac viewed representing the US in Davis Cup play as a holy grail and he did more for the US Davis Cup team than just about anyone.  He won 77 titles on the tour including seven majors.  And he was famously thrown out of the Australian Open for cursing out an umpire.


Everyone knows him, I think he's generally respected, and he likes to smoke weed and shit on Trump.



And he has a great story about how his father, also named John McEnroe, sent Trump a letter in 2015 and Trump thought it was from the tennis star.

Anyway, I'm sure there are plenty of other candidates to star in my PSA.  I invite you to nominate some in the comments.  But please hurry because the Democrats can't get out of their own way.


Friday, April 04, 2025

Economics and the Second Amendment - Redux 2025

I'm pulling a Grover Cleveland with one of my better G:TB posts because it's particularly relevant these days.  DJ Trump, who also pulled a Grover Cleveland, is not at all Gheorghe and does not read G:TB--if he did he would know that tariffs act as a tax and wouldn't have screwed up our 401(k)s.  I have Marls and Jamboni drafting a complaint right now, let us know if you want in.

DJ Trump recently announced that he will impose tariffs of 25% and 10% on imported steel and aluminum, respectively. The Dow dropped 350 points in response. Naturally, I plan to sue the President.

This isn't my idea--he had it first. Back in December 2017, Trump twat the following in response to a 350 point drop in the Dow:



I'm not sure what the exact cause of action against the President would be. Surely not negligence. If the President can't be guilty of obstructing justice how should I expect to be made whole for acts of mere Executive stupidity?

I think my best claim is infringement of my Second Amendment rights. Let me explain.

I went to arguably the most conservative law school in the country. Before classes started I was encouraged to read "Principles of Economics" by N. Gregory Mankiw, an economics professor at Harvard who was chairman of the Council of Economic Advisers under George W. Bush. I actually enjoyed the book and I dredged it up for this post.

Here's how Mankiw explains tariffs:


The increased price of foreign goods under the tariff allows domestic firms to increase their price, thus resulting in overproduction. The increased price also results in underconsumption. Consumers (i.e., everyone who isn't involved with the manufacture of steel and who isn't the government) loses the benefit of quandrangle C, D, E, and F. This because the government reaps rectangle E and manufacturers take trapezoid C. If your eyes haven't glazed over at this point, you realize that the entire market--everyone involved in this situation--loses the benefit of triangles D and F. Thus triangles D and F are a deadweight loss--absent the tariff, D and F would have been consumer surplus. Instead no one had D and F. Thus the tariff acts as a tax. And these triangles are the direct result of the aforementioned overproduction/underconsumption. This jumped out at me 15 years ago. Seriously, look at my notes in the margin.


This is important because conservatives abhor deadweight loss--when Kudlow, Laffer and Moore are against an economic policy you know it isn't conservative. And if that doesn't convince you, the fact that Democrats and unions support the tariffs should.

I personally dislike the tariffs because as Mankiw explains "When a country allows trade and becomes an importer of a good, domestic consumers of the good are better off, and domestic producers of the good are worse off. Trade raises the economic well-being of a nation in the sense that the gains of the winners exceed the losses of the losses of the losers."

Does that last sentence sound familiar? It probably does. Conservatives always say that the government shouldn't pick winners and losers. Here's what Paul Ryan has to say about this:



Of course, Ryan also applauded Trump's move that helped keep Carrier's plant in Wisconsin. Cronyism indeed!

Anyway, the upshot of this tariff is that it will cost more to manufacture things that are made out of steel (and aluminum). This added cost will, of course, be passed along to the consumer. So expect to see an increase in the price of appliances, silverware, steel-belted radial tires, beer cans, cans of beer, cars and car parts, BBQ grills, BBQ grilling utensils, wire, pots and pans, foil, golf clubs, patio furniture, fencing, fencing swords, plumbing supplies, building supplies, nails, screws, brads, tacks, nuts, bolts, washers, garbage cans, bicycles, ladders, window frames, and mattress springs.

And things like guns and bullet shells. The President's steel tariff is really a tax on guns and bullets, making it more expensive for me to exercise my god-given Second Amendment right to bear arms. "Shall not be infringed" goddammit! I'm suing! And while I'm at it I'm going to claw back the money I lost in my 401(k) just like Trump said I should three months ago.

Monday, June 02, 2014

New Hamsterdam, CO

Oscar Wilde said "Life imitates Art far more than Art imitates Life." Obviously he was a fan of The Wire. I say this because aspects of Season 3's Hamsterdam plotline are playing out in Colorado.

If you haven't seen The Wire, here's the premise of Hamsterdam in a nutshell. In an effort to reduce violent crime in his territory, Major Bunny Colvin tells all the drug dealers and junkies that they can do whatever they want within a particular part of town that is completely abandoned. He tells them something like "It's just like Amsterdam" and the crackheads think he said Hamsterdam. Hilarity ensues.



In January 2014, Colorado became the first state to legalize recreational marijuana. The results are a bit like Hamsterdam--a comedy of unintended consequences. For example, banks won't offer services to marijuana stores because they are illegal enterprises under federal law, and no one wants to be a party to money laundering. As a result, marijuana is a cash only business in Colorado and the stores have nowhere to put the cash other than safes and lockboxes. Almost instantly, they became prime robbery targets. Sort of like this.



In response, marijuana security firms cropped up. Apparently they're all staffed with Russian hitmen.



This drives up the cost of business, so an ounce of weed in Colorado is $400!



In response, the Colorado legislature made like Stringer Bell and set up a co-op.



Well, not exactly. They passed the Marijuana Financial Services Cooperative Act which permits the creation of cooperative banks to serve marijuana businesses. It'll never work.

First, it requires that each co-op receive approval from the Federal Reserve, and that ain't happening. Even if it does, operating such a co-op would be a compliance nightmare. For example, the co-ops would be required to comply with the Bank Secrecy Act, meaning that they would have to report any suspicious activities they see. Every marijuana-related transaction is a suspicious activity under the Act so that's a lot of paperwork. And the co-ops would also have to comply with various DOJ mandates, requiring insanely in-depth due diligence on all firms who bank with the co-op beginning when the open an account and continuing throughout their participation in the co-op.

Second, the Marijuana Co-op Act says that deposits in the co-ops will not be insured. I have to imagine that these co-ops will be massive targets for theft--instead of picking off pot shops one by one, enterprising robbers will hit the co-op because that's where all the cash is aggregated. These endeavors aren't going to be big operations like BOA or Citi, they'll be mom-and-pop shops operated for and probably by potheads. So I doubt they will have state-of-the-art security systems. Add in the usual risk of fire or natural disaster and it's tough to hand over all your money to an uninsured bank.

Finally, who the hell wants to open a bank to provide services to companies that openly flout federal drug laws? If we elect some fire-and-brimstone conservative in 2016, he or she could put the kibosh on all this in a hurry simply by deciding to enforce federal laws in Colorado, shutting down the pot shops and the co-ops, and then seize all the money! Oh, and they'd send the bankers to jail for money laundering. At which point the bankers would react like this:



Thus it appears that the legal sale of marijuana as currently constituted in Colorado is unsustainable. Cash keeps rolling in but there's only a finite amount of space under mattresses and inside safes to put it all. Until someone comes up with a safe, secure, reliable, and legal way to store marijuana-related proceeds, Colorado's pot shops may put themselves out of business because they are so successful. That's some crazy macroeconomics for you.