Paul Volcker died on Sunday.
A consummate civil servant, Volcker was the head of the Federal Reserve from 1979 until 1987 at a time when inflation was ruining the country’s economy.
So Volcker raised interest rates swiftly to combat rising prices, despite criticisms from people like my wife and me, who were buying a house at the time.
The politicians of that day certainly didn’t appreciate what Volcker was doing. But the towering 6-foot-7 Fed chief succeeded in getting the economy back on track.
Volcker plied his trade under Democratic President Jimmy Carter as well as Republican Ronald Reagan. He also counseled President Barack Obama, a Democrat, during the financial crisis.
In a way, Volcker is the last remnant of a bygone era, one in which politicians from both parties could cooperate long enough to accomplish things.
I never met Volcker, but I would have liked to ask him in his last days what he thought of today’s political environment. I think it would have made him sicker than he already was.
As you probably know by now, the Democrats in the House are conducting impeachment hearings against President Trump that are going nowhere. Even if Democrats approve articles of impeachment — which are the equivalent of charging the president with wrongdoing — the Republicans in the Senate, the President’s own party, will quickly throw the partisan accusations in the trash.
On Monday, the Inspector General (IG) of the US Justice Department released his long-awaited report over the tactics used by the FBI to probe the 2016 Trump presidential campaign.
The report, which was conducted by a team under IG Michael Horowitz, found that the FBI made huge errors when it got warrants under the US Foreign Intelligence Surveillance Act to monitor the Trump campaign.
“We also found basic, fundamental and serious errors during the completion of the FBI’s factual accuracy reviews … which are designed to ensure that FISA applications contain a full and accurate presentation of the facts,” said the IG’s report.
But Horowitz seemed to come down on the side that these were mistakes caused by sloppiness rather than political bias, an issue that will likely pop up again very soon since there are ongoing investigations into what the FBI and others were doing during the 2016 presidential campaign.
One is a being conducted by the US Attorney in Connecticut, John Durham, who said after the IG report was released that “Based on the evidence collected to date, and while our investigation is ongoing, last month we advised the IG that we do not agree with some of the report’s conclusions as to predication and how the FBI case was opened.”
Attorney General William Barr also blasted the IG’s findings, saying the FBI “launched an intrusive investigation of the US presidential campaign on the thinnest of suspicions that, in my view, were insufficient to justify the steps taken.”
In other words, stay tuned for more action. People are bound to be charged with crimes — something Horowitz couldn’t do — and, I’m told, at least two people have already taken plea deals.
On its face, the IG report is devastating when it comes to the sloppiness of the FBI in starting an investigation over allegations that the Russians were trying to help Trump.
“We are deeply concerned that so many basic and fundamental errors were made by three separate, hand-picked investigative teams; on one of the most sensitive FBI investigations after the matter had been briefed to the highest level within the FBI …” the IG report said.
So what does all this do for you, a citizen of the US? It is probably boring you to death.
But you should be appalled. There is now a full-blown Constitutional crisis in the US that’s likely to continue for some time. And you should also be worried that there don’t seem to be any Paul Volckers around who can stand up to both the Democrats and Republicans.
What’s really going on here is simple: the Democrats are trying to kick President Trump out of office, something they’ve been trying to do since he was elected. And the Republicans are trying to prevent that from happening.
But here’s the kicker in all this.
Voters care a lot less about the things that happened on Monday — whether it’s the impeachment or the report by the Inspector General –— than they do about what happened last Friday.
That’s when the Labor Department announced that there were 266,000 new jobs in the US in November and that 41,000 jobs more jobs were created in September and October than were previously reported.
The unemployment rate also went back down to a 50-year low last month.
And if you look at those numbers even closer you’ll notice that if it wasn’t for a change in seasonal adjustments, there would have been 30,000 or so more jobs in December.
So where does that leave us?
In my opinion, President Trump will be re-elected if the economy continues to do well enough to create large amounts of jobs. But the political battles that are now going on will be important in, I think, two ways. And if the economy slows down, President Trump has a built-in excuse. He’ll blame the Democrats’ impeachment efforts: They caused a breakdown in trade talks with the Chinese, Trump will say.
If the next step is the Justice Department and US Attorney Durham indicting people for wrongdoing against the Trump campaign in 2016, that obviously helps the President.
And voters might believe him.
There was one piece of good news this week. It seems like the Democrats and Republicans — even as they are battling — have agreed to support a trade deal between the US, Mexico and Canada.
Well, wonders never cease!