Tag Daniella Diaz

A sliver of dawn, a sleight of hand

Pat Ryan Leave a comment

Just two weeks ago the president who never stops impressing us with his corruptive instincts and self-serving interpretations of law and custom raised the bar like nobody’s ever seen before.  He went to court as a private citizen suing his own government for $10 billion in damages, then withdrew the suit in favor of the establishment of a multi-billion dollar fund he could control from the shadows that could make payments with taxpayer dollars (your taxes and mine) to anyone who claimed to have “victimized” by the Biden Justice Department, including the people convicted of crimes for storming the Capitol on January 6.  Turns out those “billion-dollar slush fund” headlines were too much, even for the cowed and subservient Republicans in Congress who had never before seen any Trump proposal they couldn’t love.  But so far, they still providing cover for another part of the “settlement” that’s just as corrupt and self-serving for you know who.

In the good news section, we have yesterday’s declaration by the acting attorney general “withdrawing a proposal to create a $1.8 billion fund to compensate people claiming to be victims of unfair prosecution, amid a revolt among Republicans who saw it as an ethical and political disaster.”  Even at that, though, the acting AG (and Trump’s former criminal lawyer) wouldn’t go as far as some members wanted.

Democrats repeatedly requested that Mr. [Todd] Blanche commit to rescind, in writing, his order creating the payout fund.

“You started it, you established it in writing, so it just makes sense to rescind it in writing,” said Representative Grace Meng, Democrat of New York.

“I’m not committing to put anything in writing,” he said, adding that he would abide by his word and would take the request under advisement.

So, won’t sign, but you can trust him?  Right.  Some Republicans senators trust him so much that today they’re considering writing a ban on the fund into law! [6/5 Editor’s note: they tried, but they did not succeed. Later today Justice Department filings in two courts stated the fund is not going forward; I’m still not convinced.]

And just because Blanche “promised” this bad idea would be canned does not, I think, mean we should trust that it will.  The Trumpists usually come up with a backup plan to get whatever crazy thing they want; they are not the kind to throw up their hands and whisper “oops, my bad.”

Still, on its face at this point, I finally see a glimmer of a sign that Trump can be stopped: by the citizens who react so viscerally to such a poorly-camouflaged grift, who then empower the paper tiger members of Congress to for once do their —-ing jobs and stand athwart a runaway Executive and shout “Stop!”  The only people who seem unhappy about this development are those January 6 offenders-turned-pardonees who thought they’d stumbled onto a way to monetize their treason.

Another good news part is that the federal judge who originally felt she had no choice but to let this plan go ahead has had a change of heart.  After three dozen former federal judges argued “that Mr. Trump’s settlement agreement raised serious questions about his ‘candor toward the court and manipulation of the judicial system,’” Judge Kathleen Williams re-opened the case to investigate allegations that the court was deceived through the misconduct of lawyers.  All of whom, you’ll recall – both sides – are Trump’s lawyers.  Words like “collusion” and “fraud upon the court” are being summoned.

Before she closed the case, Judge Williams, an Obama appointee, had in fact questioned whether the lawsuit presented an actual conflict that she could adjudicate, given that Mr. Trump was on both sides of the suit, bringing claims against a federal agency that he controlled. When she closed it, she noted there was no “settlement of record,” but shortly after, the Justice Department released its agreement foreclosing the action.

In her brief but stern order on Friday, Judge Williams said that she wanted to investigate the circumstances surrounding Mr. Trump’s efforts to settle the lawsuit in a way that benefited him and his allies. If she succeeds in moving forward with her inquiry, it could ultimately result in questions being asked of the Justice Department leaders who signed the agreements to settle the suit — chief among them, Todd Blanche, the acting attorney general, and Stanley Woodward Jr., the No. 3 official in the department.

In her order, Judge Williams asserted that she was “empowered to investigate serious misconduct” in any case before her, and ordered Mr. Trump’s lawyers to tell her by June 12 whether the lawsuit should be formally reopened because “the court was the victim of a fraud.”

She also wanted Mr. Trump’s lawyers to respond to the question of whether he had colluded with his own government to settle the case “to avoid judicial scrutiny.”

(snip)

In their filing…the former judges claimed that Mr. Trump had improperly used his suit against the I.R.S. as a way to obtain “unlawful private benefits” for himself and his family, and to create a fund that would dole out taxpayer money “without constitutional or congressional authority.”

They also argued that the president had tried to shield the deal from judicial oversight by rushing a settlement and “short-circuiting” Judge Williams’s ability to examine its terms.

Now, it wouldn’t be much of a good news/bad news set up if I didn’t have at least one bad news item to point out.  And it comes from right in the middle of the good news about the Trump Administration’s “aw shucks” reversal of the plan for a $1.8 billion fund to pay “victims” of political harassment by the Justice Department.  The Biden Justice Department only, of course.

But Mr. Blanche said he would leave in place [emphasis added] an order he signed last month that would, in effect, block the I.R.S. from investigating Mr. Trump, his family and his businesses for existing tax violations.

“Nothing has changed with that,” said Mr. Blanche, who added that the tax order would not shield Mr. Trump and his associates from future investigations.

Sleight of hand is a wonderful thing when used by magicians as entertainment, but it’s not so damn entertaining when our government distracts us with shouts of “nothing up my sleeve” while end-running Congress to legalize whatever tax evasion TFG might have committed in the past…you know, back in the time he gloated that not paying federal taxes “makes me smart.”

Trump and Republicans have offered zero clarity about the future of the other part of his slush-fund scheme: the grant of immunity from IRS scrutiny for Trump, his businesses, and his family members. Incredibly, this would “forever” bar IRS audits of past tax claims by the Trump clan or the Trump Organization. Democrats can try to make Republicans vote on that  towering act of corruption, which might prove politically even worse.

(snip)

Democrats tell me they’re moving to force votes in Congress that would effectively nullify the IRS immunity piece, as well. That provision is potentially an incredibly lucrative giveaway for Trump: It could benefit him to the tune of tens of millions of dollars. So one approach would be for Democrats to use “reconciliation”—the process that Republicans are using to pass the ICE funding, which enables Senate passage by simple majority—to push amendments that would nix Trump’s IRS immunity scam.

“We will do whatever we can to force a vote during the budget reconciliation process on this monarchical outrage and further plunder of the people,” Representative Jamie Raskin, the ranking Democrat on the House Judiciary Committee, emails me. Senate Minority Leader Chuck Schumer, meanwhile, said on the Senate floor Tuesday that Democrats are set to push an amendment that will “revoke” Trump’s and his family’s “free rein to commit tax fraud.”

Here a complication arises. Now that Trump seems to have put his slush fund on hold, Senate Republicans may drop any effort to nix it via legislation from the reconciliation process entirely. If so, that could procedurally preclude Democrats from offering any amendments involving the IRS settlement—including one nixing Trump’s IRS immunity scam.

(snip)

Now imagine if the public broadly understood that Trump has ordered his Justice Department to reach a deal exempting himself—and his businesses and family members—from a good deal of IRS examination. This could personally and directly benefit Trump by saving him enormous sums of money while quite consciously placing him and his cronies above laws that the rest of us must live under.

That’s another level of self-dealing entirely. And Trump is flaunting it with great relish. OK, then: Democrats should do everything they possibly can to ensure that vulnerable Republican incumbents own every last little bit of it.

We all know – or certainly should know by now – that the only person Trump cares about is himself.  If he could finagle a couple billion dollars to buy the continuing fawning adoration of his supporters, that’s fine; but the one part of this whole agreement he won’t give up willingly is the order to protect himself from the IRS.

You damn right nobody’s ever seen anything like this before

Pat Ryan 2 Comments

Do I have this straight: the president as a private citizen sued a department of his own government for billions of dollars, then dropped the suit as the Justice Department announced a fund that gives (essentially) him control of $1.8 billion to disburse at his whim, with no oversight, and the government agreed never to audit any of his prior income tax returns?  That doesn’t seem right…how did we get here?

As a candidate for president, who later was convicted of multiple dozens of felonies, he was asked to release his income tax returns as is customary in these elections, but said he was being audited and would release them once the audit(s) were complete.  (There is no law that prohibits the release of returns that are under audit, although some lawyers would urge their client not to while the matter is ongoing; the public release of tax returns is a nod to openness and to prove that the candidate will have no secret conflict of interest once in office.)

But then this candidate never did release his tax returns, and never gave any further reason why he chose not to do so.  (Some returns were released later by a House committee, though.)

The candidate (and we all know who I’m talking about) won the 2016 election, and later some of his federal tax returns were published after an investigation by the New York Times.  Those returns show the man who claims enormous wealth twice paid only $750 in federal income tax.  This same man had proudly boasted during the campaign that not paying taxes was an indication of his intelligence, rather than his greed or his unwillingness to pay his fair share of the operation of our nation’s government.

After the twice-impeached former president won re-election in 2024, which itself forced the termination of several other criminal cases against him due to a custom not to prosecute sitting presidents, he filed a $10 billion lawsuit – yes, TEN BILLION DOLLARS – against the Internal Revenue Service – yes, an arm of the same Executive Branch that he himself was now (again) the leader of – to recover for the alleged damages done to him by the Service’s alleged laxity in allowing his tax returns to have been published against his wishes.  That’s right: the president admits – he swears in the suit– that letting the public see his tax returns “caused Plaintiffs reputational and financial harm, public embarrassment, unfairly tarnished their business reputations, portrayed them in a false light, and negatively affected President Trump, and the other Plaintiffs’ public standing.”  Curious claim for such an outstanding and successful businessman, right, but there it is.

As the judge assigned to this case started to ask questions that indicated the suit may not have smooth sailing – that, for example, there didn’t seem to be any real conflict here if the president is suing his own government and he controls the lawyers on both sides – the president announced he has withdrawn the lawsuit.  As is his right.

But THEN, the president’s Justice Department – which has in this second TFG Administration brought shame upon itself and the nation for openly seeking revenge (under the cloak of “justice”) against the boss’ political enemies and those of the boss’ supporters – announced the creation of a giant (insert your own descriptive adjective here) fund controlled by the president’s supplicants that can be distributed by them/him, with no oversight from Congress or the courts, to those who claim damages from being victimized by a previous government of another party which had attempted (ineptly and too slowly, it turned out) to investigate allegations of lawbreaking by TFG himself.  And by his minions.

Mr. Trump’s decision to drop his suit against the I.R.S. appeared to be intended to strip Judge Kathleen M. Williams, who had been overseeing the I.R.S. case in the Southern District of Florida, of her appointed role in approving a formal settlement agreement. By dismissing the case in its entirety, Mr. Trump was able to reach an agreement with his own appointees [emphasis added] without risking the rebuke of an impartial and independent arbiter. Judge Williams, tacitly acknowledging her hands were tied, accepted the president’s dismissal of the suit and formally closed the case by the end of the day.

(snip)

Money for the fund will come from a special, unlimited account available to the Justice Department for settling lawsuits. That pool of money gives the department the authority to make monetary settlements without needing approval from Congress. A group of five people, selected by Mr. [acting attorney general Todd] Blanche, will oversee the operations of the fund, though Mr. Trump can fire its members at will. It will stop processing claims on Dec. 15, 2028, weeks before Mr. Trump leaves office.

Creation of the fund, which could be used to compensate Trump supporters who ransacked the Capitol on Jan. 6, 2021, is sure to please a president who has demanded not only retribution but recompense. But it could create major political problems for congressional Republicans already dealing with the political ballast of his unpopularity — and who will now be forced to say if they support or oppose allocating taxpayer cash to his allies at a time when many Americans are struggling economically.

AND, the agreement attempts to protect itself by claiming up front that no arm of Congress or the courts, or anyone else on this planet or any other, in perpetuity, has any legal right to try to do anything at all about it.  (We’ll see about that: two police officers who were in the Capitol on January 6 have already filed suit to block creation of the fund.  I bet there will be others.)

AND MORE THAN THAT, this agreement also bars the IRS from auditing TFG’s previous tax returns, or those of his sons, or their companies.  For ever.  (A get out of jail free card?  An after-the-fact non-disclosure agreement, shielding any evidence of any prior tax evasion?)

Is that about it?  What should we think about all this?

“This is one of the single most corrupt acts in American history,” said Donald K. Sherman, president of Citizens for Responsibility and Ethics in Washington, a nonprofit legal watchdog group that has been critical of the administration.

But others disagree, including some of the nearly 1600 people indicted for their role in the January 6 attack who have already been pardoned or had their convictions dismissed.  By TFG.  They could be getting a payout from the government they attacked.

Some felt that the fund validated their self-image as victims of the government. Others felt elated — albeit somewhat stunned — at the prospect of a payout. And not a few felt a bit confused at how the process of filing claims and receiving checks could play out.

“So many questions,” said Enrique Tarrio, the leader of the far-right Proud Boys who was sentenced to 22 years on a seditious conspiracy conviction arising from the riot. “But it’s a good direction.”

From the “most corrupt ever” reactions, to the folks annoyed by the nuisance of filling out the application, a more pertinent question (or impertinent, if you are TFG) would be, is this legal?  The answer is, I think: we will see.

The whole enterprise was a jarring shock to the conventional understanding of the constitutional system, raising what legal experts said were profound questions about presidential power. If the arrangement is allowed to stand, they said, Mr. Trump will have managed simultaneously to thwart Congress’s power of the purse and the ability of the courts to police the separation of powers.

(snip)

Professor [Samuel] Bagenstos, who served as the general counsel of the Office of Management and Budget and of the Department of Health and Human Services in the Biden administration, wrote in January about the danger posed by the Judgment Fund.

“An administration that wished to spend money on projects or beneficiaries not authorized by Congress,” he wrote, “could simply encourage its desired recipient to bring a lawsuit against the United States and then settle that lawsuit (no matter how frivolous) by making a payment from the Judgment Fund.”

While Congress has ceded power to the executive branch, it could also reclaim it. Indeed, Senator John Thune, Republican of South Dakota and the majority leader, said on Tuesday that he expected lawmakers to scrutinize how the president’s lawsuit had been ended.

(snip)

A Justice Department news release on Monday said that the “plaintiffs” — that is, Mr. Trump and his family — “will receive a formal apology but no monetary payment or damages of any kind,” a provision the White House used to defend the fund. Still, the opportunity to help direct payments approaching $2 billion to allies has value.

So does the elimination of the threat of an audit. In 2024, The New York Times reported that Mr. Trump could face a tax liability of more than $100 million.

The deal was open to question for other reasons.

The I.R.S. had plenty of defenses to Mr. Trump’s suit. For instance, it might well have been barred by the statute of limitations.

Nor was it clear that the agency was liable for the acts of Charles Littlejohn, a former I.R.S. contractor who pleaded guilty to leaking Mr. Trump’s tax information and whose actions Mr. Trump had cited as a reason he had been wronged by the government.

The sum Mr. Trump sought was also roughly equal to the agency’s annual budget.

And the suit was palpably collusive, ordinarily a reason for a judge to toss a case.

Tuesday’s addendum to the settlement, the codicil purporting to immunize Mr. Trump and his family, raised its own legal questions.

(snip)

Even under the Supreme Court’s 2024 decision conferring broad immunity on Mr. Trump for his official acts, purely private conduct, as the filing of a tax return would seem to be, is fair game for prosecution after a president becomes a private citizen. It is not clear whether the addendum could block a future administration from pursuing such a claim.