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Image: Speaker of the House Paul Ryan speaks at a news conference on Capitol Hill in Washington

As new deficit figures arrive, Paul Ryan sails away on a sea of red ink

12/14/18 09:20AM

The U.S. budget deficit for the last fiscal year, which ended in September, was $779 billion, up 16% from the previous year. As we recently discussed, that deficit was the fifth largest in modern American history -- in non-inflation adjusted terms -- and stood at 3.9% of GDP, up from 3.5% a year prior.

Those expecting an improvement in this fiscal year are going to be disappointed. The Wall Street Journal  reported overnight:

The U.S. budget gap widened in the first two months of the fiscal year as tax collections lagged behind federal outlays, which included higher spending for the military and interest on the national debt.

The government ran a $305 billion deficit in October and November, compared with $202 billion during the same period a year earlier, the Treasury Department said Thursday.

Just so we're clear, the budget deficit for 2019 is already over $300 billion. In the not-too-distant past, that would've been a fairly significant budget shortfall over a 12-month span. Now it's the deficit over just the first two months of the fiscal year.

As a rule, it's best not to make too big a fuss about fiscal data from a short period of time, since the data can and will bounce around a bit. The fact that the deficit was $305 billion in the first two months of the fiscal year, for example, does not necessarily mean that it will be nearly $2 trillion when the fiscal year ends.

That said, the latest evidence doesn't do any favors for the Republicans who assured Americans that massive tax breaks for the wealthy will pay for themselves.

And it also won't help House Speaker Paul Ryan (R-Wis.) as the retiring congressman considers his legacy.

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Giuliani argues that Trump's alleged crimes were not 'big'

12/14/18 08:40AM

Donald Trump has faced an avalanche of scandals over the last two years, but only a few run the risk of bringing his presidency to a premature end. The first, of course, is the investigation into whether Trump and his political operation conspired with Russia during its attack on the U.S. elections in 2016. The second deals with allegations of presidential obstruction of justice.

Recently, a relatively new avenue has created a level of crisis for the White House: federal prosecutors have directly implicated Trump in campaign-related felonies.

Rudy Giuliani talked to the Daily Beast yesterday, and instead of insisting that the president is innocent, the member of Trump's legal defense team said the crimes weren't especially important.

Trump insists he is innocent of any related crimes because he never explicitly asked for Cohen or AMI to violate campaign finance law by sitting on stories of his extra-marital affairs. And the president's current lawyer, Rudy Giuliani, contends that the scandal is overblown entirely.

"Nobody got killed, nobody got robbed... This was not a big crime," Giuliani told The Daily Beast on Wednesday. He added, sardonically, "I think in two weeks they'll start with parking tickets that haven't been paid."

The former New York City mayor's rhetoric is generally not to be taken seriously, but in this case, I think Giuliani touched on an argument we're going to hear quite a bit in the coming months.

Indeed, some of the White House's allies have already started walking down the same path. Sen. Rand Paul (R-Ky.) equated illegal hush-money payoffs to alleged mistresses with "an error in filing paperwork."

The defense is taking shape. "Sure, Donald Trump and his team may have committed crimes," the argument goes, "but they're not, you know, crimes."

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President-elect Donald Trump and his wife Melania Trump arrive to the "Make America Great Again Welcome Concert" at the Lincoln Memorial, Jan. 19, 2017, in Washington. (Photo by Evan Vucci/AP)

Trump-aligned super PAC draws prosecutors' scrutiny, too

12/14/18 08:00AM

Donald Trump is under investigation. Trump's business is under investigation. Trump's campaign operation is under investigation. Trump's transition team is under investigation. Trump's foundation is under investigation. Trump's inaugural committee is under investigation.

Trump's former campaign chairman and deputy chairman have already pleaded guilty to multiple felonies. Trump's former White House National Security Advisor and Trump's former personal attorney have both pleaded guilty to felonies, and are either awaiting sentencing or are already headed to prison.

Meanwhile, Special Counsel Robert Mueller's investigation is ongoing, and by some measures, the probe appears to be intensifying.

Oh, and did I mention that the Trump-aligned super PAC is facing prosecutors' scrutiny, too?

Federal prosecutors are examining whether foreigners illegally funneled donations to President Trump's inaugural committee and a pro-Trump super PAC in hopes of buying influence over American policy, according to people familiar with the inquiry.

The inquiry focuses on whether people from Middle Eastern nations -- including Qatar, Saudi Arabia and the United Arab Emirates -- used straw donors to disguise their donations to the two funds. Federal law prohibits foreign contributions to federal campaigns, political action committees and inaugural funds.

Right about now, some of the president's allies are probably thinking, "This one shouldn't be too big a problem for Team Trump, since super PACs are required by law to operate independently of campaigns."

But in this case, that argument isn't nearly as effective as the White House's supporters might hope.

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Thursday's Mini-Report, 12.13.18

12/13/18 05:30PM

Today's edition of quick hits:

* Today's school shooting: "Indiana State Police report a teenager who had threatened to shoot up the school committed suicide after being cornered by law enforcement inside the intermediate school this morning."

* The latest from France: "The suspect in the Strasbourg shooting that left three dead and 13 injured has been killed by police in that city, French authorities said Thursday."

* The Senate vote was 56 to 41: "The Senate voted resoundingly on Thursday to withdraw American military assistance for Saudi Arabia's war in Yemen, issuing the latest in a series of stinging bipartisan rebukes of President Trump for his defense of the kingdom amid outrage in both parties over Riyadh's role in the killing of a dissident journalist."

* The plot thickens: "Donald Trump was the third person in the room in August 2015 when his lawyer Michael Cohen and National Enquirer publisher David Pecker discussed ways Pecker could help counter negative stories about Trump's relationships with women, NBC News has confirmed."

* Bomb threats: "A wave of bomb threats were reported Thursday against businesses, schools, hospitals and other places across the country -- causing panic and evacuations, although all appeared to be hoaxes. Police in cities nationwide reported threats, some emailed, some phoned in."

* This took too long, but I'm glad it's done: "The House and Senate on Thursday passed new legislation overhauling the process for handling sexual harassment claims on Capitol Hill, one day after the announcement of a joint agreement on the measure. The legislation will head to the White House for President Donald Trump's signature."

* The GOP has no plan: "President Trump's increasingly urgent push to construct a massive wall on the border with Mexico has created a nightmare scenario for congressional Republicans as they race to avert a partial shutdown of the federal government at the end of next week."

* Needless cruelty: "The Trump administration is resuming its efforts to deport certain protected Vietnamese immigrants who have lived in the United States for decades -- many of them having fled the country during the Vietnam War."

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President Elect Donald Trump arrives on the West Front of the U.S. Capitol on Jan.20, 2017 in Washington, DC. In today's inauguration ceremony Donald J. Trump becomes the 45th president of the United States. (Photo by Alex Wong/Getty Images)

Trump's inaugural committee reportedly facing criminal scrutiny

12/13/18 05:03PM

There's Special Counsel Robert Mueller's investigation. There's the campaign-finance scandal in which Donald Trump has already been implicated in felonies. There's the Trump Foundation, which is also under investigation.

And in case that weren't quite enough, the Wall Street Journal reports this afternoon that Trump's inaugural committee is also facing a criminal investigation.

Federal prosecutors in Manhattan are investigating whether President Trump's 2017 inaugural committee misspent some of the record $107 million it raised from donations, people familiar with the matter said.

The criminal probe by the Manhattan U.S. attorney's office, which is in its early stages, also is examining whether some of the committee's top donors gave money in exchange for access to the incoming Trump administration, policy concessions or to influence official administration positions, some of the people said.

Some of this scrutiny, the article added, is the result of information gleaned from Michael Cohen, the president's former attorney/fixer, who was sentenced yesterday to three years in prison.

Giving money in exchange for political favors could run afoul of federal corruption laws. Diverting funds from the organization, which was registered as a nonprofit, could also violate federal law.

As regular readers know, by many metrics, Trump's inaugural fund was a great success. After his election, the Republican eliminated caps on individual contributions -- caps that George W. Bush and Barack Obama both utilized -- and sold "exclusive access" for seven-figure contributions.

The result was a fundraising juggernaut: Trump's inaugural committee took in nearly $107 million, much of which went unspent during poorly attended festivities.

The trouble is, the president's team has struggled for months to explain exactly where all of that money went.

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Maria Butina, suspected Russian agent, pleads guilty to conspiracy

12/13/18 12:52PM

As Rachel joked on the show last night, "It's Advent calendar season, which means every day, you open a new tiny door to discover a new bit of wonder." Yesterday's door led to Michael Cohen's prison sentence and revelations surrounding AMI implicating Donald Trump in a felony.

Today's door opens to show us Maria Butina's guilty plea.

Russian operative Maria Butina, who is accused of infiltrating politically powerful U.S. organizations, including the National Rifle Association, in an effort to push Moscow's agenda, pleaded guilty Thursday to a conspiracy count.

Butina has agreed to cooperate with federal prosecutors and pleaded guilty in a Washington, D.C., courtroom to one count of conspiracy to violate the law governing foreign agents operating in the United States. [...]

Thursday's guilty plea means she is admitting to conspiring with an unnamed American to act at the direction of a Russian official "to establish unofficial lines of communication with Americans having power and influence over U.S. politics ... for the benefit of the Russian Federation," according to a plea agreement.

The person she conspired with, we've recently learned, was Paul Erickson, a longtime Republican operative, who was apparently romantically involved with Butina.

Her guilty plea caries a five-year prison term, though she's hasn't yet been sentenced and we don't yet know whether the Russian will receive the maximum penalty.

Of course, the fact that Butina has struck a deal with prosecutors is a rather remarkable development: it's not every day that an accused covert Russian agent agrees to cooperate with U.S. prosecutors, and if she's forthcoming, Butina is in a position to answer more than a few interesting questions.

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Thursday's Campaign Round-Up, 12.13.18

12/13/18 12:00PM

Today's installment of campaign-related news items from across the country.

* A federal judge this morning rejected Rep. Bruce Poliquin's (R) lawsuit challenging Maine's ranked-choice voting system, which led to his defeat in the state's 2nd congressional district last month. "To the extent that the Plaintiffs call into question the wisdom of using RCV, they are free to do so but ... such criticism falls short of constitutional impropriety," Judge Lance Walker wrote.

* Nancy Pelosi (D-Calif.) reached a term-limits agreement with some of her intra-party critics last night, and in the process, secured the votes she'll need to reclaim the House Speaker's gavel.

* Remember the FBI probe of officials in Tallahassee, Fla., which Republicans used to undermine Andrew Gillum's (D) U.S. Senate campaign? It turns out, Gillum was right and he wasn't under investigation after all.

* State lawmakers in North Carolina approved a new elections-related measure yesterday, with some provisions that may affect the scandal unfolding in the state's 9th congressional district. Among other things, the bill opens the door to new primaries for voters in the district.

* Elected officials switching parties is quite rare, so it stood out to see Kansas state Sen. Barbara Bollier end her affiliation with the Republican Party.

* We can apparently add Rep. Tulsi Gabbard (D-Hawaii) to the list Democrats eyeing the 2020 presidential race. Despite some controversies over her positions, the Hawaii congresswoman told MSNBC yesterday, "I'm thinking through it very carefully. I'm thinking through it very carefully."

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Senate candidate, Rep. Bill Cassidy, left, talks to the media in Shreveport, La. on Oct. 14, 2014.

GOP senator says he's 'concerned' Trump was 'involved in a crime'

12/13/18 11:21AM

If you've been waiting for a Republican member of Congress to concede, out loud and on the record, that Donald Trump may have broken the law, I have some good news for you. NBC News has a report that included a quote that more or less qualifies.

Some Republican lawmakers have signaled cracks in what has been a solid wall of support for Trump amid intensifying federal investigations after prosecutors said Friday that Trump directed Cohen to arrange illegal payments to two women alleging affairs.

"Am I concerned that the president might be involved in a crime? Of course," Republican Sen. Bill Cassidy of Louisiana told reporters Tuesday. "The only question is, then, whether or not this so-called hush money is a crime," he added.

The pre-election payoff was obviously hush money, and according to federal prosecutors, there's no real doubt it was a crime. If that's "the only question" the Louisiana senator has, I'll be eager to see what he does with the answer.

But putting aside these relevant details, what's most striking to me about Bill Cassidy's quote is that it exists at all.

The GOP lawmaker said he's "of course" concerned about the president being implicated in a crime, as if this were an obvious position to take, but the fact remains that Cassidy has gone further than practically any other congressional Republican in response to Trump's precarious position.

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U.S. Customs and Border Protection personnel walk along a section of the recently-constructed fence at the U.S.-Mexico border on Feb. 26, 2013 in Nogales, Ariz. (Photo by John Moore/Getty)

DHS memo touts border wall construction that doesn't exist

12/13/18 10:47AM

At the start of his meeting with Democratic congressional leaders this week, Donald Trump repeated one of his favorite lies. "Tremendous amounts of wall have already been built," the president said, referring to his border project.

He added, "A lot of wall has been built. We don't talk about that, but we might as well start, because it's building -- it's being built right now, big sections of wall."

We've heard nearly identical rhetoric from Trump countless times in recent months, despite the fact that it's demonstrably ridiculous. Congress approved funding for border-security measures, including resources to replace old fencing, but lawmakers haven't approved a penny of the president's plan to build a giant wall along the U.S./Mexico border.

Given the absurdity of our current political circumstances, when the president lies like this, it hardly seems notable. Trump has told this lie before, he'll tell it again, and there's no longer much of a point to making a fuss about it.

Yesterday, however, the Department of Homeland Security published a new memo, insisting that the Trump administration is, in fact, building a border wall. The headline on the DHS piece was, simply, "Walls Work."

DHS is committed to building wall and building wall quickly. We are not replacing short, outdated and ineffective wall with similar wall. Instead, under this President we are building a wall that is 30-feet high.

FACT: Prior to President Trump taking office, we have never built wall that high.

Once funding was provided, DHS began construction of border wall exceptionally quickly....

Look, I think reasonable, objective observers can agree that Trump's credibility evaporated quite a while ago. Much of the country realizes that the president has a strained relationship with reality, and his boasts are generally seen through that lens.

But Americans still need to have some confidence in the Department of Homeland Security, so when it peddles Trump's fiction as if it were fact, it's undermining the credibility of an agency we're supposed to be able to trust in the event of an emergency.

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The end of an error: House GOP crusade against Clinton to end

12/13/18 10:12AM

On Nov. 9, 2016, literally the day after the election, then-House Oversight Committee Chairman Jason Chaffetz (R-Utah) said his pre-election plans had not changed: he would continue to use the levers of congressional power to vigorously pursue Hillary Clinton.

"We can't just simply let this go," Chaffetz told Fox News in December 2016.

The Utah Republican ended up resigning from Congress, accepting a job at Fox News, but his former colleagues on the Hill were only too pleased to pick up the mantle, keeping the focus on the former secretary of state who left office six years ago.

Last week, for example, House Republicans pressed former FBI Director James Comey for answers on Clinton's use of a private email server, and this morning, a House Oversight Committee panel will hold yet another hearing on the Clinton Foundation.

Clinton herself has joked, "It appears they don't know I'm not president."

Today's hearing, however, is a last gasp of sorts. The Republicans' House majority, won in 2010, will come to an end in a few weeks, and it's unlikely that the new Democratic majority will share the GOP's preoccupation with Clinton conspiracy theories.

TPM's Tierney Sneed had a good piece this morning, highlighting the ignominious end of the House Republicans' partisan crusade.

As their time in the majority comes to an end, and their parting shot at the Clintons is a subcommittee hearing on the Clinton charity, some House Republicans are frustrated that they haven't been able to capture their great white whale before they hand over the gavel -- and subpoena power -- to the Democrats. [...]

Rep. Matt Gaetz (R-FL), a rising star among President Trump's most devout allies in the House, said Tuesday that "low energy leadership" stopped House Republicans from gaining traction on their investigations in recent years.... "I think we should have pushed harder."

It's a curious perspective: some anti-Clinton partisans, apparently frustrated by how little they have to show for their years of effort, look back at the last several years and believe Republicans just weren't anti-Clinton enough.

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Image: *** BESTPIX *** US District Court Holds Hearing On Trump Lawyer Michael Cohen's Search Warrants

Trump breaks silence, says Cohen's crimes 'were not criminal'

12/13/18 09:30AM

Even as his former personal attorney was sentenced to three years in prison, Donald Trump had very little to say yesterday, and his White House issued no formal statements in response to the developments. This morning, however, the president published a trio of tweets, offering his reaction to the news. (I'm adding the paragraph breaks in the hopes of making the message slightly more readable.)

"I never directed Michael Cohen to break the law. He was a lawyer and he is supposed to know the law. It is called 'advice of counsel,' and a lawyer has great liability if a mistake is made. That is why they get paid.

"Despite that many campaign finance lawyers have strongly stated that I did nothing wrong with respect to campaign finance laws, if they even apply, because this was not campaign finance. Cohen was guilty on many charges unrelated to me, but he plead to two campaign charges which were not criminal and of which he probably was not guilty even on a civil basis.

"Those charges were just agreed to by him in order to embarrass the president and get a much reduced prison sentence, which he did-including the fact that his family was temporarily let off the hook. As a lawyer, Michael has great liability to me!"

Evidently, it took the president nearly a full day to come up with this.

There's probably no point in scrutinizing every error of fact and judgment in the message, but there were two things that jumped out at me. The first is Trump's continued insistence that the hush-money payoffs to his alleged former mistresses were "not campaign finance."

The evidence to the contrary is overwhelming. Indeed, American Media Inc., which publishes the National Enquirer tabloid, admitted it paid off one of Trump's alleged former mistresses, "in concert with" the Trump campaign, in order to "suppress the woman's story so as to prevent it from influencing the election."

But perhaps even more interesting is the president's assertion that his former fixer pleaded guilty to two "campaign charges which were not criminal."

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