It's much worse than that as a logical argument! There were no congressional majorities on the eve of World War I for a central bank like the First or the Second Bank of the United States or the Bank of England. The dominant progressive view was that those were fortresses of high finance banker power, and were unfit for America. Therefore a deal was struck: instead of one central bank located in the financial hub, there would be 12 regional banks to serve as "reserve banks". The directors of these banks would not be exclusively bankers and their friends, but would represent the interests of the users of banking services as well as the providers. and on top, supervising the whole system, there would be a standard progressive era independent agency with president appointed and senate confirmed governors. (The only deviation from standard progressive era practice was to offer the governors 14-year rather than four-year terms.)
This is not an institution in any sense continuous with the First and Second Banks of the United States. And the idea that the United States should have a standard central bank was fought over politically and decided decisively in the age of Andrew Jackson. The answer was "no."
Now comes the corrupt Supreme Court majority in Slaughter to say that in spite of nearly 130 years of precedent and understanding about how the Constitution works, "ooopsie! independent Progressive Era-pattern agencies are and always have been unconstitutional!" And there is nothing at all to distinguish the Federal Reserve Board from the other agencies whose independence from the momentary pleasure of the president has now been destroyed.
And John Roberts did not even try to find anything distinguishing. There is the bare assertion that the Federal Reserve is the first and second banks of the United States—which it is not. and there is the claim that institutions like the first and second bank of the United States are constitutionally hunky-dory— which was a position that was disputed and fought out in the ages of Hamilton, Madison, and Jackson, and ultimately resolved with the final answer being "no".
Now Lisa Cook is a former student of mine. Lisa Cook is very good people. Lisa Cook is highly qualified to be on the Board of Governors of the Federal Reserve right now. I see no credible case that Lisa Cook has committed any form of mortgage fraud. She deserves on all the equities to keep her job. And a system in which Congress has stated that executive officers should only be removed "for cause" should mean what it says.
But that does not keep Roberts' opinion here from being profoundly mendacious on pretty much every level I can think of.
> **John Ganz**: No Touch Money <https://www.unpopularfront.news/p/no-touch-money>: 'How else can one possibly reconcile the decisions handed down yesterday—Trump v. Slaughter and Trump v. Cook?... n Cook, the same court, the same justices, discover an exception! The president cannot remove a member of the Federal Reserve Board without establishing cause. What’s the difference? Well, the Fed is special...
I hear you. In capitalism, capital is king. And the bourgeois own it.
I’d thought we had addressed some of the worst of capitalism’s excesses the past 100 years, but the past 40 have been mostly re-instating the economic favoritism towards the already wealthy. We’re moving *back* towards the unfettered capitalism Marx witnessed.
I agree 100% the tortured logic of the opinions reveals these priorities. The President can’t screw up the regulation of the money supply and banking system. But he can *every* other regulatory scheme, almost all of which are essentially citizens protections against business excess put in place ever since Sinclair published The Jungle. They are seeking to roll it all back
Meanwhile Cass Sunstein is still pretending the Seditious Six are serious legal scholars working out the implications of the Constitution and their legal theories. This type of pandering to power is the job of the elite law schools
Nice reference to “Touchez pas au grisbi,” the great 1954 Jean Gabin movie. Direct, simple, and elegant, the film is a real contrast to today’s events.
I agree with John's conclusion, and indeed it is very commonly and openly expressed by thoughtful political conservatives, albeit in different terms. (They usually use it to limit the power of a central bank--monetary policy and nothing else.) I only want to set a bit of John's history straight.
Plenty of founders were in favor of the first BUS. George Washington signed the legislation, and I think we can fairly call him a founder. Same for many in the first Congress. Jefferson really really! really!!! hated the first BUS (his opinion on constitutionality was little short of frothing), but Madison did not.
Madison's objections were legal, and indeed, he probably thought that the First BUS was good on the merits. In a January 8, 1782 letter to Edmund Pendleton, he stated that the Bank of North America was wise on the merits, but had constitutional problems. During the Constitutional debates, he was interested in providing a limited chartering power to Congress. It ultimately went no further than the Post Office Clause. His speech to the First Congress against chartering stressed remediable issues: the wealth transfer to Northern speculators implicit in the subscription procedure of the act; an excessively long lifetime; a branching power. His draft of a veto message for Washington (Feb. 21, 1791) stressed the unfair subscription procedure, and indeed the subscription procedures were rescinded a week after passage.
Madison strongly disagreed with Hamilton on only one merits issue: a general trading company, like the South Sea Company. (The impeachment of Warren Hastings was in progress at the time.) He hated them, and raised this issue often in his speech to Congress. This was not a problem with the Bank of the United States, since its charter explicitly forbade trading. However, he and Edmund Randolph (who was the Attorney General and opined to Washington against the Bank) both shared the legal belief that the power to charter a bank was also the power to charter a trading company. In Madison's mind, it was worth sacrificing the BUS to avoid a monopolistic national trading company.
Hamilton adopted precisely this position in his first draft on the constitutionality of the bank (Feb. 23, 1791), but in the opposite direction. He liked monopolistic trading companies! , However, Hamilton was no political fool. He dropped any references to his beloved trading companies in his final report to Washington on constitutionality.
The issue with the underlying thesis here seems to be that the Cook case was one vote away from going Trump’s way.
This would suggest a conflicted, rather than monolithic, state—even in this supposedly fundamental role of backstopping the capitalist system.
What to make of the four dissenting justices, and the legions of similarly disposed jurists who might well ascend to replace one of the five in the majority?
The second Trump administration has not been kind to economic determinism.
Well, look at the Tarriffs case. Isn't it interesting that when core capitalist interests are involved it somehow always goes against Trump? the closeness seems to suggest a structural account—its the determination in the final instance.
Two cases—one decided by the leanest of possible majorities–don’t a pattern make. Consider all the deeply destabilizing actions the court has let Trump get away with, the times it has indulged his whims, and consider too that above all else instability and capriciousness are a threat to capital: indeed, investors and corporations will happily work with outright socialist and even communist governments so long as they provide some predictability.
This entire administration has been nothing but a president at every opportunity giving the finger to the market and the impersonal rules and systems it depends, and instead attempting to reorganize the economy and writ large through his own personality, including by individually pressuring firms and their leaders to make uneconomic decisions. He has disrupted crucial global commodity and capital flows more than any communist leader ever dreamed of, in a manner that will hobble capitalist firms and nations for years—if not decades—to come. There have and will be cascading consequences across the planet that will cost the global economy billions, if not trillions, of dollars. By electing such an erratic and narcissistic president and giving him unified control of government, we have run an unprecedented natural experiment on whether independent economic influences drive political/historical outcomes, or if they are contingent on the personalities of the most powerful world leaders, and can regard determinism as disproven as a theory.
I think "economic determinism" means something different from what you think it means. It certainly does not preclude the possibility that one faction of the ruling class will see its interests eclipsed by those of another faction.
And I'm pointing out that no economic factor, no class or factional interest, has proven deterministic of Trump's actions—none, zero. This is an administration of actes gratuits, driven by nothing other than the peculiarities of a single unstable individual's psyche. Any attempt to attribute economic logic to his behavior shatters against the rocks of innumerable contrary and contradictory actions he has taken: it's a futile and pathetic effort to impose order on total chaos.
And as I noted above, Trump's very unpredictability is by itself anathema to any capitalist scheme, even those of the moronic grifters who try to profit by his behavior. Capitalism requires rationality, stability, guarantees that the future will minimally resemble the present, and Trump is utterly irrational and unstable and prone to abrupt reversals.
The alleged rationality of capitalism has always been a bit of a bait and switch. The true history has from the start been one of excesses & crises, bubbles & crashes, competition yielding to concentration. It has never viewed "stability" as a virtue, nor has it ever much cared about the future resembling the present. Capitalism is, and always has been, about constant disruption and displacement. The so-called Reagan revolution was all about ripping out the stabilizing mechanisms that had been added during the New Deal and the postwar decades. Obama and Biden tried to reassert a bit of rational management but came up short (to put it mildly). America's ruling class has proven to be perfectly content to put up with Trump's irrationality and corruption as long as he cuts their taxes, gooses their profits, and approves their monopolistic activities.
Floating within the Cook decision is instructions on how Donny can fire her.
But the key thing in that mess is the “for cause” language. That maybe raises the question whether a conviction is per se a basis for a for cause firing or even should be.
As for the Fed being a special case, media hagiography and other BS notwithstanding, I think there’s a question just how important an independent Fed is. One might think that an SEC that took its policing job seriously would be seen the same but it clearly is not.
It's much worse than that as a logical argument! There were no congressional majorities on the eve of World War I for a central bank like the First or the Second Bank of the United States or the Bank of England. The dominant progressive view was that those were fortresses of high finance banker power, and were unfit for America. Therefore a deal was struck: instead of one central bank located in the financial hub, there would be 12 regional banks to serve as "reserve banks". The directors of these banks would not be exclusively bankers and their friends, but would represent the interests of the users of banking services as well as the providers. and on top, supervising the whole system, there would be a standard progressive era independent agency with president appointed and senate confirmed governors. (The only deviation from standard progressive era practice was to offer the governors 14-year rather than four-year terms.)
This is not an institution in any sense continuous with the First and Second Banks of the United States. And the idea that the United States should have a standard central bank was fought over politically and decided decisively in the age of Andrew Jackson. The answer was "no."
Now comes the corrupt Supreme Court majority in Slaughter to say that in spite of nearly 130 years of precedent and understanding about how the Constitution works, "ooopsie! independent Progressive Era-pattern agencies are and always have been unconstitutional!" And there is nothing at all to distinguish the Federal Reserve Board from the other agencies whose independence from the momentary pleasure of the president has now been destroyed.
And John Roberts did not even try to find anything distinguishing. There is the bare assertion that the Federal Reserve is the first and second banks of the United States—which it is not. and there is the claim that institutions like the first and second bank of the United States are constitutionally hunky-dory— which was a position that was disputed and fought out in the ages of Hamilton, Madison, and Jackson, and ultimately resolved with the final answer being "no".
Now Lisa Cook is a former student of mine. Lisa Cook is very good people. Lisa Cook is highly qualified to be on the Board of Governors of the Federal Reserve right now. I see no credible case that Lisa Cook has committed any form of mortgage fraud. She deserves on all the equities to keep her job. And a system in which Congress has stated that executive officers should only be removed "for cause" should mean what it says.
But that does not keep Roberts' opinion here from being profoundly mendacious on pretty much every level I can think of.
> **John Ganz**: No Touch Money <https://www.unpopularfront.news/p/no-touch-money>: 'How else can one possibly reconcile the decisions handed down yesterday—Trump v. Slaughter and Trump v. Cook?... n Cook, the same court, the same justices, discover an exception! The president cannot remove a member of the Federal Reserve Board without establishing cause. What’s the difference? Well, the Fed is special...
<https://braddelong.substack.com/p/i-am-glad-lisa-cook-rightly-gets>
Thanks! Wonderful history lesson.
I hear you. In capitalism, capital is king. And the bourgeois own it.
I’d thought we had addressed some of the worst of capitalism’s excesses the past 100 years, but the past 40 have been mostly re-instating the economic favoritism towards the already wealthy. We’re moving *back* towards the unfettered capitalism Marx witnessed.
I agree 100% the tortured logic of the opinions reveals these priorities. The President can’t screw up the regulation of the money supply and banking system. But he can *every* other regulatory scheme, almost all of which are essentially citizens protections against business excess put in place ever since Sinclair published The Jungle. They are seeking to roll it all back
Meanwhile Cass Sunstein is still pretending the Seditious Six are serious legal scholars working out the implications of the Constitution and their legal theories. This type of pandering to power is the job of the elite law schools
https://substack.com/home/post/p-203589229
Nice reference to “Touchez pas au grisbi,” the great 1954 Jean Gabin movie. Direct, simple, and elegant, the film is a real contrast to today’s events.
"... the real, old American tradition is abolishing the thing."
And especially the old *Jacksonian* tradition is abolishing the thing. Isn't DJT supposedly another Andrew Jackson?
More like Andrew Johnson, if truth be told.
I agree with John's conclusion, and indeed it is very commonly and openly expressed by thoughtful political conservatives, albeit in different terms. (They usually use it to limit the power of a central bank--monetary policy and nothing else.) I only want to set a bit of John's history straight.
Plenty of founders were in favor of the first BUS. George Washington signed the legislation, and I think we can fairly call him a founder. Same for many in the first Congress. Jefferson really really! really!!! hated the first BUS (his opinion on constitutionality was little short of frothing), but Madison did not.
Madison's objections were legal, and indeed, he probably thought that the First BUS was good on the merits. In a January 8, 1782 letter to Edmund Pendleton, he stated that the Bank of North America was wise on the merits, but had constitutional problems. During the Constitutional debates, he was interested in providing a limited chartering power to Congress. It ultimately went no further than the Post Office Clause. His speech to the First Congress against chartering stressed remediable issues: the wealth transfer to Northern speculators implicit in the subscription procedure of the act; an excessively long lifetime; a branching power. His draft of a veto message for Washington (Feb. 21, 1791) stressed the unfair subscription procedure, and indeed the subscription procedures were rescinded a week after passage.
Madison strongly disagreed with Hamilton on only one merits issue: a general trading company, like the South Sea Company. (The impeachment of Warren Hastings was in progress at the time.) He hated them, and raised this issue often in his speech to Congress. This was not a problem with the Bank of the United States, since its charter explicitly forbade trading. However, he and Edmund Randolph (who was the Attorney General and opined to Washington against the Bank) both shared the legal belief that the power to charter a bank was also the power to charter a trading company. In Madison's mind, it was worth sacrificing the BUS to avoid a monopolistic national trading company.
Hamilton adopted precisely this position in his first draft on the constitutionality of the bank (Feb. 23, 1791), but in the opposite direction. He liked monopolistic trading companies! , However, Hamilton was no political fool. He dropped any references to his beloved trading companies in his final report to Washington on constitutionality.
The issue with the underlying thesis here seems to be that the Cook case was one vote away from going Trump’s way.
This would suggest a conflicted, rather than monolithic, state—even in this supposedly fundamental role of backstopping the capitalist system.
What to make of the four dissenting justices, and the legions of similarly disposed jurists who might well ascend to replace one of the five in the majority?
The second Trump administration has not been kind to economic determinism.
Well, look at the Tarriffs case. Isn't it interesting that when core capitalist interests are involved it somehow always goes against Trump? the closeness seems to suggest a structural account—its the determination in the final instance.
Two cases—one decided by the leanest of possible majorities–don’t a pattern make. Consider all the deeply destabilizing actions the court has let Trump get away with, the times it has indulged his whims, and consider too that above all else instability and capriciousness are a threat to capital: indeed, investors and corporations will happily work with outright socialist and even communist governments so long as they provide some predictability.
To the contrary, Trump 2 has revived economic determinism as a plausible explanation of recent American history.
This entire administration has been nothing but a president at every opportunity giving the finger to the market and the impersonal rules and systems it depends, and instead attempting to reorganize the economy and writ large through his own personality, including by individually pressuring firms and their leaders to make uneconomic decisions. He has disrupted crucial global commodity and capital flows more than any communist leader ever dreamed of, in a manner that will hobble capitalist firms and nations for years—if not decades—to come. There have and will be cascading consequences across the planet that will cost the global economy billions, if not trillions, of dollars. By electing such an erratic and narcissistic president and giving him unified control of government, we have run an unprecedented natural experiment on whether independent economic influences drive political/historical outcomes, or if they are contingent on the personalities of the most powerful world leaders, and can regard determinism as disproven as a theory.
I think "economic determinism" means something different from what you think it means. It certainly does not preclude the possibility that one faction of the ruling class will see its interests eclipsed by those of another faction.
And I'm pointing out that no economic factor, no class or factional interest, has proven deterministic of Trump's actions—none, zero. This is an administration of actes gratuits, driven by nothing other than the peculiarities of a single unstable individual's psyche. Any attempt to attribute economic logic to his behavior shatters against the rocks of innumerable contrary and contradictory actions he has taken: it's a futile and pathetic effort to impose order on total chaos.
And as I noted above, Trump's very unpredictability is by itself anathema to any capitalist scheme, even those of the moronic grifters who try to profit by his behavior. Capitalism requires rationality, stability, guarantees that the future will minimally resemble the present, and Trump is utterly irrational and unstable and prone to abrupt reversals.
The alleged rationality of capitalism has always been a bit of a bait and switch. The true history has from the start been one of excesses & crises, bubbles & crashes, competition yielding to concentration. It has never viewed "stability" as a virtue, nor has it ever much cared about the future resembling the present. Capitalism is, and always has been, about constant disruption and displacement. The so-called Reagan revolution was all about ripping out the stabilizing mechanisms that had been added during the New Deal and the postwar decades. Obama and Biden tried to reassert a bit of rational management but came up short (to put it mildly). America's ruling class has proven to be perfectly content to put up with Trump's irrationality and corruption as long as he cuts their taxes, gooses their profits, and approves their monopolistic activities.
Floating within the Cook decision is instructions on how Donny can fire her.
But the key thing in that mess is the “for cause” language. That maybe raises the question whether a conviction is per se a basis for a for cause firing or even should be.
As for the Fed being a special case, media hagiography and other BS notwithstanding, I think there’s a question just how important an independent Fed is. One might think that an SEC that took its policing job seriously would be seen the same but it clearly is not.
😆