Kevin Drum - August 2013

Reuters: NSA Secretly Helping Drug Agencies Target US Persons

| Mon Aug. 5, 2013 12:27 PM EDT

Yesterday, the New York Times informed us that the Drug Enforcement Agency wants greater access to the NSA's treasure trove of surveillance, but so far they haven't gotten it. Today, Reuters tells us that this isn't really true:

A secretive U.S. Drug Enforcement Administration unit is funneling information from intelligence intercepts, wiretaps, informants and a massive database of telephone records to authorities across the nation to help them launch criminal investigations of Americans.

....The unit of the DEA that distributes the information is called the Special Operations Division, or SOD. Two dozen partner agencies comprise the unit, including the FBI, CIA, NSA, Internal Revenue Service and the Department of Homeland Security.

...."Remember that the utilization of SOD cannot be revealed or discussed in any investigative function," a document presented to agents reads. The document specifically directs agents to omit the SOD's involvement from investigative reports, affidavits, discussions with prosecutors and courtroom testimony. Agents are instructed to then use "normal investigative techniques to recreate the information provided by SOD."

....A former federal agent in the northeastern United States who received such tips from SOD described the process. "You'd be told only, ‘Be at a certain truck stop at a certain time and look for a certain vehicle.' And so we'd alert the state police to find an excuse to stop that vehicle, and then have a drug dog search it," the agent said.

This is not surprising. As you may recall, NSA is allowed to surveil foreign nationals but not US persons. If US persons are "inadvertently" caught up in the surveillance net, their communications have to be discarded. However, there are exceptions for domestic communications that "contain usable intelligence, information on criminal activity, threat of harm to people or property, are encrypted, or are believed to contain any information relevant to cybersecurity." Drug offenses are criminal activity, so presumably NSA is allowed to keep any drug-related conversations it collects and pass them along to the relevant law enforcement agencies.

Does this give NSA an incentive to "accidentally" collect communications on US persons, so that they can trawl through them to find stuff they're allowed to keep? Perhaps. Either way, though, it appears that NSA is more involved in drug investigations—and more eager to keep it a secret—than we've been led to believe.

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RNC Chair Pretends to Be Outraged Over Hillary Miniseries

| Mon Aug. 5, 2013 11:46 AM EDT

Speaking of Republicans trying to work the refs, here's their latest effort: a letter to NBC demanding that they cancel their planned Hillary Clinton miniseries, which RNC chair Reince Priebus calls a "thinly-veiled attempt at putting a thumb on the scales of the 2016 presidential election." Here's the final paragraph of the letter:

That kind of swagger goes over well with the base, but in the real world it accomplishes nothing except to ensure that NBC doesn't accede to their demands. But I guess that's probably the point. I doubt that Priebus really cares much about the miniseries, which is likely to have a near-zero effect on the 2016 race. But he does care about rallying the troops. This should accomplish that nicely. I expect this to generate plenty of chatter in the Fox/Drudge/Rush echo chamber over the next few days.

"Uncertainty" Is Gone, But the Sluggish Recovery Is Still With Us

| Mon Aug. 5, 2013 11:31 AM EDT

Why has the economy recovered so sluggishly since the 2008-09 recession? Reasonable people can point to lots of reasons: debt overhang, the zero lower bound on interest rates, loss of housing wealth, and too little fiscal stimulus, among others. But if none of those actual reasons suit your political agenda, you can always just make something up. Republicans, for example, found it convenient to blame "uncertainty." The business community was just so stonkered by the blizzard of new rules and regulations from the Obama administration that it was unwilling to invest in the future.

Never mind that business investment has actually recovered fairly nicely. Never mind that outside the financial sector (which is doing just fine, thankyouverymuch), Obama hasn't introduced any more regulations than other recent presidents. Never mind that lack of consumer demand was more than enough to explain whatever reluctance businesses might have had to build new factories.

Never mind all that. Republicans wanted to blame the sluggish recovery on mountains of red tape from the business-hating Obama administration, and the press played along. This means that "uncertainty" got a lot of media attention, which in turn means that if you have an "uncertainty index" based partly on media mentions, it would have shown persistent elevation during 2010-12, the heyday of the uncertainty campaign. Sure enough, that's exactly what it showed:

Amazingly enough, the index suggests that economic uncertainty was higher in mid-2012 than it was during mid-2008, when the entire global financial system was collapsing around our ears. And just as amazingly, it's plummeted ever since. Today it's only barely higher than its 2000-07 average.

On a substantive basis, the fact that uncertainty spiked during the debt ceiling crisis (labeled with an N on the chart) makes sense. The rest of the high level of uncertainty between 2010 and 2012 really doesn't. However, if instead you read the last few years on this chart as basically measuring the strength of the Republican campaign to pretend that Obama was strangling business growth with his tsunami of rules and regulations, then it makes perfect sense. Republicans had plenty of incentive to promote that theme during campaign season, and now that it's over they don't. So the index goes down.

This comes via Jim Tankersley, who points out that if uncertainty really was driving the sluggish recovery, we'd expect to be seeing a hiring boom now that it's declined. But there's really been no sign of this. As we knew all along—and as the media should have known all along—"uncertainty" was just an invented partisan talking point. It no longer serves any purpose, so now it's gone. But the sluggish recovery is still with us.

Test Scores in New York City Are Nothing to Write Home About

| Mon Aug. 5, 2013 10:19 AM EDT

New York City is about to introduce new, more difficult school testing based on the Common Core curriculum, and that means average scores are likely to go down. Mayor Michael Bloomberg is getting ready to take some heat:

The mayor’s telling of history is poised to receive one of its most vigorous challenges yet on Wednesday, when New York State is expected to report drastic drops in student performance across the state because of a new set of tougher exams.

In New York City, the proportion of students deemed proficient in math and reading could decrease by as many as 30 percentage points, city officials said, threatening to hand Mr. Bloomberg a public relations problem five months before he is set to leave office.

....As his mayoralty winds down, Mr. Bloomberg has sought to burnish an image as a savior of a school system rife with racial and socioeconomic disparities. But several of the Democratic candidates for mayor have rejected that portrayal, seizing on anger among some parents rankled by what they say is his unilateral approach to governing.

Politics is politics, but the rest of us don't really need to pay any attention to this. Nor do we have to pay attention to New York's own testing, which may or may not be afflicted by dumbed-down tests that are about to get dumbed back up. Nor do we have to guess. Instead, we can just look at TUDA, the subset of the national NAEP test aimed at urban districts. New York City has participated in TUDA for Bloomberg's entire mayoralty, and the basic results are below:

New York City's test scores have increased over the past decade, but they've increased less than in most other big cities (2 points vs. 6 in reading, 6 points vs. 12 in math). On the 4th grade test, New York City has done about the same as other big cities. This isn't a massive failure, but it doesn't look like any kind of outsized success either.

For Once, the Public Is a Winner in a Bureaucratic Turf War

| Sun Aug. 4, 2013 10:59 AM EDT

While all the rest of us are fretting over the NSA's mind-bogglingly wide surveillance powers, it turns out that the rest of the intelligence community is fretting that they aren't quite wide enough. The New York Times reports:

Agencies working to curb drug trafficking, cyberattacks, money laundering, counterfeiting and even copyright infringement complain that their attempts to exploit the security agency’s vast resources have often been turned down because their own investigations are not considered a high enough priority, current and former government officials say.

....At the drug agency, for example, officials complained that they were blocked from using the security agency’s surveillance tools for several drug-trafficking cases in Latin America, which they said might be connected to financing terrorist groups in the Middle East and elsewhere.

....The security agency’s spy tools are attractive to other agencies for many reasons. Unlike traditional, narrowly tailored search warrants, those granted by the intelligence court often allow searches through records and data that are vast in scope. The standard of evidence needed to acquire them may be lower than in other courts, and the government may not be required to disclose for years, if ever, that someone was the focus of secret surveillance operations.

Needless to say, this is precisely what a lot of us are concerned about: that every drug investigation in the world will suddenly become linked to "financing of terrorist groups," and therefore authorized to trawl endlessly through NSA's information pool and take advantage of rubber-stamp FISA warrants that cover anyone who meets a certain profile. For now, at least, I think we can be grateful that bureaucratic turf wars have apparently kept that under tight control.

Friday Cat Blogging - 2 August 2013

| Fri Aug. 2, 2013 1:50 PM EDT

Remember that great picture of Domino sitting on the front porch silhouetted against our garden a couple of months ago? Well, this is actually one of her favorite spots—mainly because we recently bought a new doormat that's kind of stiff and bristly, and she loves going out there to roll around and scratch her chin on it. Whenever she does, I grab my camera and take a few pictures, hoping someday to get a shot where she's actually looking at me instead of away from me. This is surprisingly hard, because when she's looking in my direction, I normally only get one shot off before she sees the lens and bustles over to demand some human attention.

Anyway, I am nothing if not determined, in a lazy sort of way, and for weeks now I've been doing this late in the day when the sun backlights both garden and cat. Finally, a few days ago, I got a decent picture. Just this one. Enjoy.

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If You're On Trial, You'd Better Hope Goldman Sachs is on Your Side

| Fri Aug. 2, 2013 12:45 PM EDT

In the case of former Goldman Sachs trader Fabrice Tourre, the U.S. government was able to secure only a weak civil judgment. But in the case of former Goldman Sachs programmer Sergei Aleynikov, the U.S. government succeeded in winning a sentence of eight years in prison even though their case was so weak it was overturned almost immediately on appeal. What was the difference? After reading Michael Lewis' Vanity Fair piece on Aleynikov, Felix Salmon explains:

The big difference between the two cases is that while Tourre was defended by Goldman Sachs, Aleynikov was prosecuted by them: Lewis leaves the reader in no doubt that the decision to prosecute, along with all the supporting arguments, while nominally taken by the FBI, was essentially made by Goldman Sachs itself. The irony is painful: the government, acting against Goldman Sachs, could only manage a civil prosecution. But Goldman Sachs, acting through the government, managed to secure itself a highly-dubious criminal prosecution, complete with an eight-year prison sentence.

Lewis doesn’t delve too deeply into the jurisprudence here. But it’s obvious that the case would never have been brought without Goldman’s aggressive attempt to cause as much personal destruction as possible to Aleynikov.

Emphasis mine. Aleynikov is not 100 percent innocent in this case. He's close, though. And even now, after his sentence has been overturned, Goldman Sachs has managed to continue its persecution of Aleynikov by getting the Manhattan D.A.’s office to arrest him on some brand new charges, for no apparent reason except to make sure the guy has a criminal record. (He's already served enough time that he wouldn't return to prison even if he were convicted.)

So there you have it. In a nutshell, these two cases tell you who really runs things here in the land of the free. Both Lewis's article and Salmon's summary are well worth a few minutes of your time.

Republicans Holding Firm So Far on DC Court Filibuster Threat

| Fri Aug. 2, 2013 11:48 AM EDT

Apparently Republicans are holding firm on their threat to filibuster every single nominee ever to the DC Circuit Court. Every single Democratic nominee, that is. Not because they have any particular objections to them, but just because they don't want to lose the current Republican majority on the DC Court.

(Technically, their argument is that the DC Court is "underworked" and all its open seats should be permanently eliminated. This is so obviously specious there's no real need to pretend to take it seriously.)

In any case, Ed Kilgore wonders if this will ignite any summer recess passion among progressives:

The question is whether [...] Democratic senators leery of a general position opposing filibusters of life-time judicial nominations might make an exception if the filibusters are being advanced on this type of specious ground rather than objections to the qualifications of individual judges.

The timing, with three DC Circuit nominations heading towards the Senate floor immediately after the August recess, is interesting. Will senators hear about this relatively obscure issue when they are back home? That's hard to say....It would be nice if Democratic senators known to be wobbly on filibuster reform--ranging from outright opponents like Carl Levin to more questionable cases like Mark Pryor and Reid himself--heard from progressives on this issue in August. I see no particular merit in the counter-argument that countenancing filibusters to preserve the overall ideological character of this or that federal panel is a weapon Democrats might want to use in the future. The kind of judges a Republican president is likely to nominate any time in the near future are going to have the track records and associations that make them debatable on their individual merits; our conservative friends will make damn sure of that.

OK, then. You have your marching orders. Go raise some hell.

Tax Reform This Year is Just a Charade

| Fri Aug. 2, 2013 11:24 AM EDT

Bruce Bartlett argues today that tax reform is a nonstarter this year. It's insanely complicated; nothing exists even in draft form yet; and House Ways and Means Committee Chairman Dave Camp is busy thinking about a plan to run for the Senate in 2014:

Consequently, the idea that there will be a tax reform bill for the House to consider by the time it must raise the debt limit is ludicrous....Personally, I think Mr. Camp knows full well that he can’t do tax reform this year or next. He just wants a bill for Congress to consider so that there will be many opportunities to meet with lobbyists about their objections to one provision or another. This will help him raise campaign contributions for his very expensive Senate race.

This is your cynicism alert for the day. Which isn't to say it's wrong, of course.

Chart of the Day: Net New Jobs in July

| Fri Aug. 2, 2013 10:28 AM EDT

The American economy added 162,000 new jobs last month, but about 90,000 of those jobs were needed just to keep up with population growth, so net job growth clocked in at 72,000. That's about the same as last month. In fact, it's about the same as every month for the past year: OK, but not great. The headline unemployment number declined to 7.4 percent, mostly due to more people getting jobs, but partly due to more people dropping out of the labor force.

There's really not much else to say. There are no big stories here about any particular industry, or about government employment, or anything else. Wages are flat, as they have been for the past couple of years. We're just stuck treading water: The economy isn't in horrible shape, but neither is it showing any signs of accelerating into a genuine recovery. Or, to put it another way: the economy isn't bad enough to persuade Republicans to do something about it, but neither is it good enough to be producing lots of new jobs on its own. As always, we need to keep on hoping that nothing catastrophic happens in China or Europe or anywhere else, because right now we're not in good enough shape to ride it out.