Authored by Jeffrey Tucker via The Epoch Times,

The American people are going to be paying a high price for the 2024 U.S. presidential election and probably for years. I’m not speaking of the results which astonished the world; I’m speaking of the attempt to game the intended results that began more than a year earlier.

It won’t come in the form of higher taxes. It will be inflation, which is another form of taxation.

The problem of dollar devaluation could have been over by now but no. All evidence is that the Biden administration, in service of larger interests and in accommodation of Congressional spending, deployed the printing presses starting in 2023 as a means of assuring its reelection chances. It did not work and now we are stuck with the bill.

To be sure, there was never an overt policy but what I said above is a reasonable interpretation of why the Federal Reserve reversed its stance on the money spigot in 2023 and following.

There was never an excuse to do so. Inflation had already ravaged producers and consumers. The first priority was getting it under control. Instead, they went the other way, thus risking a second wave, which might just be getting going.

The latest producer and consumer price reports look simply awful, a full-on reversal of downward trends to reveal a renewed problem.

Now that Trump is taking office, the corporate media and the Bureau of Labor Statistics is suddenly being more forthcoming about the problem. Inflation is running at 3 percent or 50 percent above target. The low-end estimate of purchasing power losses since 2020 is 23 cents on the dollar. The real-time estimates are closer to 30 cents. The reality depending on what you buy is far higher.

Let there be no confusion about the source of the problem.

It is not gouging grocers. It is not greedy consumers. It is not opportunistic suppliers. It is not even restrictions on energy production.

It is the money printers in D.C. who have deployed their powers to print in service of a Congress that has spent without limit, as if the resources will all appear just like magic. The flood of debt has granted the Fed an enormous portfolio available for playing politics.

Again, one only needs to observe the relationship between M2, the most accurate rendering of the money stock we have, against the CPI. The relationship is impossible to deny both in terms of the data and also the theory. It’s not complicated really but requires just a bit of thought.

Thomas Massie gives the example of 10 apples and 10 dollars, in an economy where all money is spent. Each apple costs a dollar. If the money stock is doubled, each apple costs two dollars. And so on. It’s a simple example but gets the point across. In the real world, there is a lag of the effect, between 12 and 18 months. In this case, the lag hits the 12-month mark almost exactly.

(Data: Federal Reserve Economic Data (FRED), St. Louis Fed; Chart: Jeffrey A. Tucker)

None of this is a mystery. Hatred of paper-money printing traces to the very foundation of the nation. Thomas Paine wrote about it extensively. He was an opponent of tyranny and a very thoughtful and brilliant person. He read extensively on history and economic theory as it stood in his time. He stated very clearly:

• “I know not why we should be so fond of paper money; it has no intrinsic value, and is not money, but a promise to pay money.”

• “Paper money is like dram-drinking, it relieves for a moment by deceit.”

• “The evils of paper money have no end. It is a swindle upon the people, and the foundation of all other swindles.”

His views were shared widely among the Founding Fathers. When the Constitution was written, it included a clause requiring states (which managed money) to use only gold and silver in coinage. That clause was long adjudicated by the courts and eventually the proponents of paper money found a means around it, via various emergency declarations and suspensions. The gold standard was restored following the Civil War but suspended again and again. Eventually, the specie backing was removed entirely.

For a long time, between 1933 and 1974, it was illegal even to own gold for investment purposes. That changed and then the United States started minting gold coins again but not as part of official money. They are collectibles, very beautiful but not usable as legal tender. The link between U.S. monetary policy and gold is entirely broken.

Ideally it would be restored. Problem: no one really knows how this could happen. There is no real viable plan to get from here to there. The United States would have to own vast quantities of gold and there would need to be a fixed ratio of exchange, and this would have to pertain not only in the United States but also abroad. The decision alone would cause a mass repatriation of dollars and exhaust the gold stock in a day.

In short, the practical problems associated with restoring a genuine gold standard are inconceivably huge. An even bigger problem is mustering the political will to do it. Both parties benefit from the paper-money system and the flexible monetary policy, for which the U.S. citizen ultimately pays the highest price.

There are other paths toward sound money. The money stock could be instantly frozen, but that would induce deflation on a scale that would be seen as intolerable. I happen not to think this would be a bad thing. A growing purchasing power of money would benefit the people. But the expert class disagrees, warning of a terrible recession. And the reality would likely back that prediction.

The trouble is that the U.S. economy and, really, the world economy, are deeply addicted to debt finance. Putting a stop to that would be very painful. The political will to do that simply is not there.

The genuinely constitutional solution would be to return all responsibility for monetary policy to the states alone, abolishing the central bank entirely. The U.S. Treasury could mint its own currency but that poses dangers of its own. Whether and to what extent those dangers would be as bad as the Fed now is another question.

In the near term, the solution is simply to force the Fed to stop playing politics with its monetary powers. The interest rates should be completely set free from Fed intervention. Open market operations and debt buying and selling should stop entirely. The rest would take care of itself.

Economists I respect suggest a quantity rule that would tie monetary policy to output. While that solution looks good on paper, measuring output accurately is no longer such an easy task. The GDP numbers as they stand are very sketchy and so are the numbers on the inflation rate itself. Without accurate numbers, the capacity of the Fed to conduct monetary policy in any scientific manner pretty well evaporates.

Let us hope that the new Trump administration eventually gets around to dealing with the problem of paper-money inflation. It might have to do so given the genuine risk of a second wave of inflation that could literally doom its political legacy.

I hope someone in the Trump administration is listening: at minimum the Fed must stop its quantitative easing and commit itself to a policy of monetary stabilization at the very least. Yes, we could face a technical recession and that is politically dangerous. But a continuation of inflation is even more so.

Views expressed in this article are opinions of the author and do not necessarily reflect the views of The Epoch Times or ZeroHedge.

With many Americans working two jobs to make ends meet, mollycoddled progressive staffers on Capitol Hill are now demanding 32-hour workweek.

In a letter to top House and Senate leaders Thursday, the Congressional Progressive Staff Association proposed establishing a rotating 32-hour workweek on the Hill, claiming that reduced hours could “improve worker satisfaction, increase staff retention in Congress, and model a more sustainable approach to work on a national level,” Politico reports.

Under the proposal, congressional staffers would still work long hours when their boss is around. But when Congress is in session, district office staffers would be entitled to an abbreviated, 20-percent-lighter schedule, and when it is not, D.C.-based staff would have a lighter week.

“We do not want a 32-hour workweek to just be another special benefit for Congressional staff,” the group said in its letter requesting the special benefit. “We hope that by adopting this policy, Members of Congress can help to advance the discussion around a more sustainable workweek as a national priority and model how it can work for private and public employers across the country and the world.”

Ah – so by granting rich-kid, connected staffers their 32-hour workweek (and we assume therapy ponies are next), they can set an exaaaample (Michael Savage voice) for the rest of the country – and the world.

Socialists are ecstatic at the idea:

It’s an idea that’s gained some traction on the left, with Sen. Bernie Sanders (I-Vt.) introducing legislation to implement a 32-hour workweek nationally. But those on the right and some corners of the left immediately panned the plan when it was released Thursday.

That said, others think it’s a terrible idea:

For some Democrats, the cusp of Trump’s inauguration was the wrong time to pitch working less. Said Tim Hogan, a Democratic communications consultant and former Hill staffer: “lol read the room guys.” -Politico

Rep. Ritchie Torres (D-NY) mocked the idea on X, posting “Why not be bold and ask for a 0-hour workweek? I wonder how blue-collar Americans would feel about white-collar workers demanding a 32-hour workweek.”

Republicans also mocked the idea, suggesting that it was a good one as long as they scale back their salaries to match.

“Progressives should opt in. Easy place to cut 20%+ @elonmusk,” posted Rep. Chip Roy (R-TX) on X.

The rich kids slapped back, with group spokesperson Michael Suchecki saying “The frustration about this initiative comes from a fundamental misunderstanding. CPSA is not calling for Congress to jeopardize its productivity with a new office schedule. We believe — and researchers agree — that implementing a rotating 32-hour work week will not maintain existing levels of productivity and work quality, but increase them.“

Via Middle East Eye

On Saturday, Gaza ceasefire talks were down to the wire, and President-elect Donald Trump’s Middle East envoy wanted to hash out the deal once and for all with Benjamin Netanyahu, but the Israeli leader’s office said he could not be roused during Shabbat.

Steve Witkoff allegedly gave a “salty” reply, making it clear he didn’t care if it was the Sabbath, the Jewish day of rest. In the words of one report from Haaretz, Witkoff said Trump expected Israel to agree to the ceasefire, and “things that Netanyahu had termed life-and-death issues…suddenly vanished.”

So, who is Witkoff, Trump’s new man in the Middle East?

Witkoff is a Republican and a billionaire Jewish-American real estate developer. His soft, slightly nasally voice masks his reputation as a hard-charging negotiator who developed the nerve for leveraged loans as a teenager betting at the racetrack. When he was starting off in the cut-throat world of New York City real estate in the 1990s, he wore a handgun strapped to his ankle, according to a Wall Street Journal expose from the time. 

Witkoff has been praised for pushing the ceasefire across the finish line. Qatari Prime Minister Sheikh Mohammed bin Abdulrahman bin Jassim al-Thani credited him in a speech announcing the deal on Wednesday, albeit one usurped by Trump’s earlier proclamation that an “EPIC” ceasefire had been reached. It is important to note that Witkoff was mentioned before the sitting Biden administration’s envoy, Brett McGurk. 

The New Yorker turned south Floridian has no official training as a diplomat and his appointment epitomizes Trump’s disdain for traditional bureaucrats and policy wonks, who are steeped in area expertise and boast graduate degrees in international relations but lack private sector experience.

“We have people that know everything about the Middle East, but they can’t speak properly…he is a great negotiator,” Trump said at a press conference in January, praising his friend.

There, Trump reiterated his now infamous pledge that “all hell will break out” in the Middle East if the hostages held in Gaza were not freed by the time he takes office on 20 January. “You know what that means, do I have to define it for you,” he barked at a journalist, who pressed for details.

Witkoff may not have Trump’s bravado, but the two golfing friends go back nearly forty years.

Fix, lease, sell…or refinance

Witkoff first met Trump in 1986 when he was a young real estate lawyer at a white-shoe law firm where the future president was a client. Associates say Witkoff was inspired to ditch his corporate job and enter real estate because of Trump.

Witkoff started out by buying small tenements in the Bronx and Harlem during the 1987 real estate crash. His early deals were a far cry from globe-trotting ones he would strike later in the Gulf. He relied on a small regional bank called M&T in Buffalo, New York, for loans.

To cut costs, he performed the labor on his buildings himself – even reportedly leaving a 1992 New Year’s Eve dinner party to dig a sewage trench.

Like Trump, his real estate empire was based on debt and a close-knit circle of family, friends, and their relatives – some of whom he hired when they were out of work. “We fix buildings, lease them up, and then sell or refinance them,” Witkoff told The Wall Street Journal in a 1998 interview.

By then, Witkoff was a proper player in New York real estate with bodyguards and a sprawling empire of office buildings. Witkoff Group’s portfolio comprises properties in New York, southern Florida and Los Angeles. One of his latest projects is Shell Bay, a luxury golf development near Miami, where one-bedroom condos start at $1.9m.

Praise on Gulf states

Like the Trump organixation, Witkoff’s firm has done business with the energy-rich Gulf.

In 2023, he sold Manhattan’s swanky Park Lane Hotel to the Qatari Investment Authority, the country’s sovereign wealth fund, for $623m. Abu Dhabi’s sovereign wealth fund also took a stake.

Trump has tapped a slew of Middle East experts for senior government positions, often those who have been critical of Qatar and Islam.

Witkoff’s incoming deputy, former State Department spokesperson Morgan Ortagus, said she converted to Judaism in Saudi Arabia, where people “hate Jews”.

Trump tapped Eric Tagger, a Republican Senate staffer who has slammed Qatar for its alleged ties to Hamas and the Muslim Brotherhood, as the top official overseeing the Middle East at the National Security Council. However, Witkoff has rarely waded into the details of Middle Eastern culture and religion or debates on groups like the Muslim Brotherhood. He is all business and has been universal in heaping praise on Gulf states. 

At Qatar’s 20204 Economic Forum, he praised Qatar, calling it “very, really impressive”, adding, “whoever they had who master planned here did a really good job…this is solid government. The hotels here are magnificent.”

Witkoff has expressed similar admiration for the UAE’s pro-business agenda. In December, he took the stage at Bitcoin MENA, a cryptocurrency conference in Abu Dhabi. Witkoff and Trump’s sons are cofounders of World Liberty, a crypto company.

Witkoff doesn’t speak much in public, but when he does, he is measured and deliberate. Appearing on Fox News in January, he said Trump’s “strong stance, his certitude in asserting that ‘all hell would break loose’ is moving people,” when asked about the ceasefire talks. 

He added: “They (the hostages) are living in terrible conditions, and it’s time for everybody to come back.” His remark that “There will be plenty of Palestinians who will be released as a result of this and they will go home to their families,” did not elicit a response from Fox News host Sean Hannity.

With Trump saying he will use the hostage deal to expand the 2020 Abraham Accord agreements, Witkoff is likely set to delve deeper into the world of Gulf politics and the Israel-Palestine conflict.

He has also said he wants to solve tensions with Iran over a nuclear weapon “diplomatically…if people are willing to adhere to their agreements,” but, ever the negotiator, he did not show too much of his hand: “We are not going to have a nuclear arms race in the Middle East.”

Blinken’s final news conference Thursday, which came hours after the announcement of a ceasefire agreement between Hamas and Israel, was a bit of a disaster given no less than two journalists were forcibly removed from the US State Department briefing room.

First, veteran journalist Sam Husseini was accused of ‘heckling’ the outgoing top US diplomat. That’s when US State Dept police were called upon to violently drag him out. “You pontificate about a free press!” Husseini told Blinken as he was taken away by several uniformed officers. Some pundits pointed out the double standard given Blinken routinely lectures countries like China, Russia, and Iran on freedom of the press issues. Watch the incident unfold below:

BREAKING Let everyone know this is what the US State Department does to a journalist asking real questions and this is what’s coming for anyone doing the same thing.

You won’t see this in China, Russia or Iran though. @samhusseini pic.twitter.com/YaEleHmXUm

— Fiorella Isabel (@FiorellaIsabelM) January 16, 2025

“I am asking questions after being told by [spokesman] Matt Miller that he will not answer my questions,” Husseini continued as he was roughly escorted out. “I’m a journalist not a potted plant,” he also said.

Blinken had told Husseini to “respect the process”. He had responded, “Everybody from Amnesty International to the ICJ [International Court of Justice] is saying that Israel is doing genocide and extermination, and you’re telling me to respect the process?”

“Criminal! Why aren’t you in The Hague?! Why aren’t you in The Hague! Why aren’t you in The Hague!” Husseini yelled while being carried out of the room by security.

Fuller video clip:

What stood out for me was not the actions of journalist @samhusseini but those in the room who fell in line, as he was forcibly removed.

“I’m a journalist not a potted plant.”
– Sam Husseini, January 16, 2024 pic.twitter.com/Hr87ZFJF4A

— Samira Mohyeddin سمیرا (@SMohyeddin) January 16, 2025

Journalist from The GrayZone Max Blumenthal also went off on Blinken. “Why did you keep the bombs flowing when we had a deal in May?” he asked. “Why did you allow my friends’ homes in Gaza to be destroyed?”

Blumenthal charged Blinken with “sacrific[ing] the rules-based order on the mantle of your commitment to Zionism.” “You helped destroy our religion, Judaism, by associating it with fascism,” he said.

For this, Blumenthal too was quickly detained and taken out of the room by State Dept police. 

Blumenthal going out with a bang, as the Biden admin spokespersons go out with a whimper and a smirk…

My final words for Tony Blinken, Secretary of Genocide, and his smirking press secretary, Matt Miller pic.twitter.com/DuLnepSwDl

— Max Blumenthal (@MaxBlumenthal) January 16, 2025

The incident involving the pair of journalists overshadowed the whole press conference, and even seeped into mainstream media coverage.

Both Blinken and Matthew Miller looked visibly upset and uncomfortable as the whole spectacle unfolded and as the accusations flew.

Reporter @samhusseini was just physically dragged from Blinken’s briefing. “Why aren’t you at The Hague?” he asked. pic.twitter.com/Nvs10aFjgh

— Ryan Grim (@ryangrim) January 16, 2025

Miller could be seen with his characteristic smirk, while Blinken’s face looked grim amid the fracas. 

Via Headline USA,

California Gov. Gavin Newsom joined a handful of Republican governors this week in ordering his state to fly the U.S. flag at full height on Inauguration Day, despite President Joe Biden’s order to keep government flags at half-staff because of the death of former President Jimmy Carter.

Flags at the U.S. Capitol and state buildings across the country are expected to remain at half-mast for a 30-day mourning period following Carter’s death.

President-elect Donald Trump, however, has argued the flags should be returned to full height for his inauguration ceremony next Monday.

“The Democrats are all ‘giddy’ about our magnificent American Flag potentially being at ‘half mast’ during my Inauguration,” Trump wrote on Truth Social earlier this month.

“They think it’s so great, and are so happy about it because, in actuality, they don’t love our Country, they only think about themselves.”

He claimed his inauguration would be the “first time ever” the U.S. flags at the U.S. Capitol building would be flown at half-mast.

“Nobody wants to see this, and no American can be happy about it,” Trump added.

In response, several Republican officials, including House Speaker Mike Johnson, R-La., Florida Gov. Ron DeSantis, Texas Gov. Greg Abbott, announced they would return their state buildings’ flags to full height before Inauguration Day.

Newsom is the first Democrat to join them in the decision.

House Speaker Mike Johnson (R-La.) announced on Tuesday that flags will fly full-staff at the U.S. Capitol for Trump’s swearing-in ceremony, with the flags being lowered back to half-staff after the event.

The Democrat’s announcement comes just one week after Newsom rallied Democratic state legislatures to pass $50 million in funding to “Trump-proof” the state.

Newsom claimed the funding, passed during a special legislative session, was necessary to “safeguard California values and fundamental rights in the face of an incoming Trump administration.”

He immediately faced blowback from frustrated Californians, who argued Newsom should be focusing on “fire-proofing” the state instead.

“You’re talking about Trump this, Trump that. He’s not even president,” actor Michael Rapaport said last week.

“Get the f*** out of here!”

Last week, Newsom wrote a letter to the president-elect and said he should visit fire-ravaged areas in Los Angeles to “meet with the Americans affected by these fires”

“Join me and others in thanking the heroic firefighters and first responders who are putting their lives on the line,” he said.

Newsom will likely have to rely on federal assistance from the Trump administration to deal with the aftermath of the fires.

A trans Massachusetts city councilor is taking a one-month leave of absence, citing feelings of being unsafe after allegedly being “misgendered” by the mayor and another councilor, and being referred to as “it” by a third city official. 

The soap opera starring that councilor, Thu Nguyen, erupted at Tuesday night’s meeting of the Worcester, Massachusetts city council, where members held a public hearing over whether it was appropriate for council members like Nguyen to attend meetings remotely. Once again appearing remotely, Nguyen blamed the mayor and peers for the routine failure to show up in person, saying, “Under your leadership, I have felt unsafe around this council body. I have faced transphobia with being misgendered and recently learned that I have been dehumanized to a point where I’m being referred to as ‘it’ by my colleagues on this council.”

Heralded as the “first openly nonbinary lawmaker” in Massachusetts history — a title we’re sure Paul Revere and Samuel Adams would be totally impressed with — Nguyen has held office on the Worcester city council since 2022. Nguyen’s preferred pronouns are “they/them.” 

The day after the hearing, Nguyen posted a statement saying “I am…sad to announce I will be taking a month to prioritize my mental and emotional safety,” so he could recover from having allegedly been misgendered by Mayor Joseph M. Petty and Councilor-at-Large Kathleen Toomey, and called “it” by Councilor Candy Mero-Carlson. Nguyen filed a complaint with Worcester’s Office of Diversity, Equity and Inclusion, urging the prompt launch of an investigation, adding that is was unfortunate to do so at the very same time that “we transition under a Trump administration and exponential increase of fear experienced by the LGBTQ+ community.” 

On Thursday, the city clerk confirmed that Nguyen will continue receiving a $2,641 monthly city stipend while providing nothing for Worcester other than melodrama. 

On the defensive and careful to say the right things for liberal Massachusetts society, Petty said, “We are in a time of uncertainty, where members of the LGBTQIA+ community face real fears and challenges in simply being their authentic selves…I would never knowingly say anything harmful.” He says Nguyen’s accusation of misgendering goes all the way back to 2022 — Nguyen’s first year — when the mayor forgot to use “they/them” before correcting himself and apologizing. Toomey said she’s made a similar “honest mistake” during Nguyen’s rookie year, saying “there’s never, ever been any attempt on my side to misgender them.” 

Alleged “it” girl Mero-Carson issued a more assertive statement. “While I do not recall making the statements in question, I acknowledge that it was a challenging and emotional week where difficult conversations took place…It is deeply troubling that Councilor Nguyen has chosen to distort the narrative and weaponize these accusations for political purposes,” noting that Nguyen has the “the lowest attendance record of any City Councilor.” 

As you might expect, Nguyen’s council profile is loaded with woke leftist blather like this gem: “Invested in the notion of social justice, they [sic] commit their time and efforts in…navigating the intersectionality of identity, systems and openings for collective care and healing.” Nguyen concludes by touting a trio of identity-politics point-makers: “They [sic] are proud queer, Vietnamese, nonbinary refugee.” 

Since announcing the month off from work, Nguyen has been active on Facebook, basking in support pouring in from “allies,” such as LGBT group MassEquality, which condemned the “bullying” Nguyen has experienced. Nguyen is also wallowing in victimhood, posting the text of “hate emails” like this: 

“Don’t confuse my speaking the truth to you here with hate or some kind of phobia…Your petty, emotional, shrill, fake outrage about being misgendered is not helping you or trans people. It’s what keeps you down….Taking a month off. LOL! Who wants to have to put up with childish, petulant temper tantrums like that? No one. No one wants to work with you now and even though you will scream ‘transphobia’ it won’t be that. It will be idiot-phobia.” 

Authored by Kimberley Hayek via The Epoch Times,

The city council in Tijuana, Mexico, a border city located 20 miles south of San Diego, unanimously passed an emergency declaration on Jan. 13 to allocate city funds for the anticipated arrival of deportees from the United States after President-elect Donald Trump takes office on Jan. 20.

Trump made mass deportations an integral part of his campaign platform and said in November 2024 that he would declare a national emergency to carry them out.

The council voted on the additional funds in a virtual meeting, the office announced in a statement on social media.

Tijuana Mayor Ismael Burgueño said the city is working closely with Mexico’s federal government.

“We knew that at some point, we could quickly face challenges in infrastructure, public services, as well as security and more,” he said during the meeting, referring to receiving potentially thousands of people in the city in a short amount of time.

The mayor said the declaration would guarantee the city has the conditions and resources to receive the influx of deportees.

“Once they are deported, they are guaranteed to be treated with dignity with full respect for their human rights,” Burgueño said in Spanish, adding that as they return to their country or state of origin they should feel protected and supported.

The emergency funds are expected to be used to hire security personnel, leasing facilities, utilities, and legal services. The declaration also frees the city up to apply for federal funds.

Tijuana earlier this month announced plans to open a shelter with enough space to house 10,000 deportees. Burgueño said at a Jan. 9 press conference that the shelter could be increased to house 30,000 people if needed.

“We want to give deportees the best possible space available,” he said.

Tijuana officials aim to avoid a return of street encampments, which cropped up in the city during past migrant surges, such as during a migrant caravan in 2018, as well as in 2021 and 2022. In 2022, Mexico’s National Guard was deployed to clear an encampment.

“Public spaces should not be used to house migrants,” Burgueño said.

He added that the declaration would also seek to protect the people of Tijuana from interference in their daily life.

“We want for those of us who already live here in Tijuana to be able to continue using these spaces and not have any changes around their homes or communities.”

In addition to preparations being made by Tijuana, Mexico’s state and federal governments are establishing plans to deal with the anticipated arrival of deportees.

Baja California Gov. Marina del Pilar Ávila announced last week new shelters in Tijuana to house deportees before they would be returned to their place of origin with the goal of opening the shelters before Trump’s inauguration.

At the federal level, Mexico has been preparing for Trump’s immigration enforcement plans with a particular focus in Mexico’s northern states that sit on the border of the United States.

Mexican President Claudia Sheinbaum, who took office last fall, said in December that Mexico would only allow Mexican citizens to be sent into the country as part of Trump’s deportation efforts. She later amended her position, stating Mexico would be open to collaborating with the United States to return the illegal immigrants to their country of origin.

Mexico’s efforts at the federal level to prepare for mass deportations also include the development of a cellphone app for Mexican citizens in the United States illegally, which would assist them in contacting their families and the local Mexican consulate should they face deportation.

Mexico also opened a 24-hour call center to field questions from Mexican citizens who are in the United States illegally.

Mexico, which has a population of approximately 128.5 million, also increased its consular staff and legal aid resources to assist illegal immigrants with navigating the deportation process.

According to the Office of Homeland Security Statistics, there were about 11 million illegal immigrants in the United States as of January 2022.

The Congressional Budget Office may claim it is apolitical and/or bipartsian, but in reality they have few reservations in throwing under the bus any politician(s) that are not viewed as part of the establishment inner circle, and “kitchen sink” them with all the accumulated financial troubles that have piled up in the US. That politician is Donald J. Trump, who is about to be inaugurated as the 47th US president, and who will soon see US debt – already at a ridiculous $36.2 trillion – really explode during his second administration, Musk’s pet project DOGE notwithstanding.

According to the latest CBO budget and economic outlook for the decade 2025 to 2035 the situation is hopeless and getting worse, and even though the budget office doesn’t use those actual terms, it does get pretty close.

While the economic picture presented by the CBO is hardly shocking, if as ridiculous as always, with zero recessions expected over the coming decade when the CBO projects GDP growing at a 1.8% annual pace, with inflation magically flat at 2.0%, unemployment rate a sticky 4.4% and a 3.2% fed funds rate (translating into 3.8% 10Y yield)…

… it gets more exciting when looking at how all this growth is going to be funded. And the answer, of course, is through trillions more in unsustainable deficits, although according to the CBO these are perhaps sustainable since they never seem to end.

So starting with the deficit projection, the CBO expects a 2025 federal deficit of $1.9 trillion, a number which grows to $2.7 trillion by 2035. And while it amounts to 6.2% of GDP in 2025, and then drops to 5.2% by 2027 as revenues increase faster than outlays, this modestly beneficial trend quickly reverses and in later years, outlays once again increase faster than revenues, and by 2035, the deficit once again equals 6.1% of GDP, a number which according to the CBO is “significantly more than the 3.8 percent that deficits have averaged over the past 50 years.” It goes without saying that the actual deficit number will be far, far greater because even a modest recession will assure a surge in government spending (i.e., much more debt-funded deficit) which however will not result in faster growth.

It gets better. In an attempt to entrap Trump, who will very extend extend the expiring TCJA, or Trump tax cuts, the CBO amusingly enough cuts its long-term deficit forecast by $1 billion, but not because of higher growth or anything like that, but because it forecasts “increases in projected revenues from individual income taxes” even as “legislative changes and technical (that is, neither economic nor legislative) changes boosted projected deficits.” As a result, the cumulative deficit from 2025-2034 is expected to decline by $1 trillion, from $22.1 trillion to $21.1 trillion.

That way, in one year when the Trump tax cuts are extended, the CBO will throw the book at trump and blame him when it once again revises its deficit forecast dramatically higher.

As for the real reason why the US deficit is about to go exponential has little to do with taxes, and everything to do with the stratospheric levels of US debt, or rather interest on that debt, we find that while things are more or less normal for the next 3 years, then they go vertical, to wit:

“Federal outlays in 2025 total $7.0 trillion, or 23.3 percent of GDP. They remain close to that level through 2028 and then rise, reaching 24.4 percent of GDP in 2035 (if adjusted to exclude the effects of shifts in the timing of certain payments). The main reasons for that increase are growth in spending for Social Security and Medicare and rising net interest costs.”

Unfortunately, there is no such hockeystick effect to US government revenues which total $5.2 trillion, or 17.1% of GDP, in 2025, then rise to 18.2% of GDP by 2027, which according to the CBO is “because of the scheduled expiration of provisions of the 2017 tax act”, which obviously will not expire and instead will be extended, meaning revenues will not increase and while the CBO knows this, it will instead wait for 6-12 months before letting the hammer fall in its next, far uglier forecast.

But even without the 2017 tax act, the CBO projects that revenues as a share of GDP will then decline over the next two years, falling to 17.9% in 2029, and flatline around 18.3% in 2035. In reality, this number will be far lower, perhaps around 15% if note worse, due to the extension of the Trump tax cuts which means that the next CBO forecast will be substantially worse than the current one.

Alas, this one is also a disaster, and one has to look no further than the CBO’s debt forecast to see that. That’s because while debt held by the public (which conveniently excludes debt used to fund Social Security), is currently at $28.2 trillion, this number nearly doubles by 2035, when it is expected to hit $52.1 trillion.

But wait, wouldn’t debt only increase as GDP also increased, with the relative ratio improving? Actually no, because as the infamous CBO “chart of doom” shows, as debt held by the public rises each year, it does so at a faster pace than GDP; in fact, from 2025 to 2035, debt/GDP swells from 100% to 118%, an amount which as the CBO admits, is “greater than at any point in the nation’s history.”

Now the reason why the CBO published a report that saw a modest improvement in the US fiscal picture over the next decade is not because the US fiscal picture is actually improving, but on the contrary, was to entrap Trump and republicans. As ABC notes, “the analysis paints a difficult picture for an incoming Republican administration bent on cutting taxes in ways that further widen deficits unless they’re also paired with major spending cuts.” Indeed, Trump’s proposed extension of his 2017 tax cuts that are set to expire after this year along with new cuts could easily exceed $4 trillion and his nominee to be treasury secretary, Scott Bessent, warned Thursday that the economy could crash without them.

“We do not have a revenue problem in the U.S.,” Bessent insisted at his confirmation hearings. “We have a spending problem.”

He’s right, but the even bigger problem is that cutting any spending, whether discretionary or mandatory, would lead to unprecedented economic devastation for a country that is used to issuing debt and spending it like a drunken sailor.

While tax revenues as a share of the total U.S. economy are close to the 50-year average, government spending is poised to continue growing, largely because of the unprecedented $1.2 trillion in gross interest expense, a number that will almost certainly never go down again, because even if interest rates do drop briefly, the total amount of debt will just keep rising, more than offsetting any rate decline. Meanwhile, discretionary spending on national security and social programs will account for $1.85 trillion next year. The CBO already has spending in these categories on a downward trajectory as discretionary spending would equal 5.3% of GDP, down from the half-century average of 7.9%.

CBO Director Phillip Swagel told reporters at a press conference Friday that net interest costs are a major contributor to the deficit and “in the coming years, net interest costs are projected to be similar to the amounts of discretionary spending for either defense or non-defense” programs.

And all of that is, of course assuming no recession and a demographic picture that remains unchanged; alas both assumptions are ludicrous.

With an aging population, government spending would largely increase because of Social Security and Medicare — two programs popular with voters that many Republicans and Democrats alike have vowed to protect, despite clear signs that they’re on an unsustainable path.

Swagel said. “We’re already an aging society and the aging of our society is driving mandatory outlays.”

And as American women wait later in life to have children and have fewer of them, “the change of fertility sometimes accelerates that pattern of the aging of our society,” he said.

Michael Peterson, CEO of the Peter G. Peterson Foundation — which among other things tracks the federal debt — said in a statement that “as lawmakers consider the range of expiring tax policy at the end of the year, they should make a commitment to at least ‘do no fiscal harm’.”

“They should avoid budget gimmicks and base their assumptions on neutral, nonpartisan estimates like this one from CBO,” he said.

Unfortunately for the US, it is now way too late to change the inevitable outcome of an existence that has been driven by exorbitant debt-funded spending. Indeed, when it comes to normalizing or “doing no fiscal harm” that ship has sailed, and as much as we would like for there to be some happy ending, we are terrified at what will happen when the brightest minds in the room admit that the Department of Government Efficiency (DOGE) has been a failure, and that nothing can prevent the inevitable US implosion.

More in the full CBO bidget forecast.

Authored by Jonathan Turley,

As lawyers, we often take a series of steps to protect the interests of our clients when it becomes necessary to sever or end representation. The dropping of a client can have a damaging impact on the reputation or standing of a client. That is why it was surprising to see Mark Lemley, a Stanford law professor publicly denounce Mark Zuckerberg as part of social media tirade. It is a deeply concerning lesson for students at a law school already rocked by prior controversies over intolerance for opposing viewpoints.

When we take on a client, we are closely identified with their interests and their case. That creates a deep professional obligation not to use that relationship for our own benefit against the interests of our client. Thus, a lawyer cannot sever an unpopular criminal defendant by denouncing him as morally reprehensible.

We continue to shoulder that obligation even after we end our representations. (I have had to sever clients in the past and avoided any public statement on the reasons or critical comments tied to the cases).

Professor Lemley did not represent Zuckerberg in a criminal matter. However, he was counsel in the high-profile representation of Meta in 2023 after comedian Sarah Silverman and other authors sued the company for alleged copyright violations.

After Zuckerberg recently pledged to restore free speech protections on Meta, many on the left went positively berserk.

This week, Lemley, a partner at the law firm Lex Lumina, decided that he was not content with simply severing the representation without fanfare or embarrassment to his clients.

Instead, he decided to publish a tirade on LinkedIn to denounce Zuckerberg’s “descent into toxic masculinity and Neo-Nazi madness.”

He declared “While I think they are on the right side in the generative AI copyright dispute in which I represented them, and I hope they win, I cannot in good conscience serve as their lawyer any longer.”

He further declared that he deactivated his Threads account because he did not want to “support a Twitter-like site run by a Musk wannabe.”

Rather than expressing concern over the trashing of a former client, Rhett Millsaps, managing partner of Lex Lumina, stated, “Money can’t buy everyone. We’re proud to be a firm that doesn’t sell out our values. Sadly, it seems this is becoming a rarer and rarer quality in America today.”

The incident raises a question that can be uncertain and difficult for many lawyers. I do not believe that Professor Lemley should be forced into a life of monastic silence over Meta policies unrelated to his litigation. Zuckerberg is a public figure and Lemley often engages in public commentary.

What concerns me is the nexus drawn by both Lemley and Lex Lumina to their representation of Zuckerberg to magnify their message of opposition. They could have simply severed representations without comment while Lemley could have continued his commentary in opposition to the new free speech policies. Frankly, while Professor Lemley is a respected and accomplished academic, it is doubtful that such criticism would have generated significant media attention. It was the connection to severing representation that amplified the message and caused the criticism to go viral.

Instead, the media is aflame with stories of how even Zuckerberg’s own lawyer and law firm cannot abide him. That was the obvious result of the public statements made by Lemley and the firm in demonizing their former client and citing their severance as morally compelled by his policies.

This can clearly be a gray area for many lawyers. The rules expressly prevent a lawyer from representing a client in an adverse case against a prior client or using information derived from the prior case. That is not the case here. Indeed, Professor Lemley appears to stand by the merits of the earlier case. The question is whether lawyers should use their prior representation as a type of cudgel in a public denunciation of a former client, using their prior representation to elevate their own voices.

None of this sits well with me, but I may be “old school” on such professional conduct issues. I would feel the same way if a lawyer attacked an anti-free speech figure like Hillary Clinton by emphasizing their prior representation. Once again, I am not suggesting that representation bars lawyers from criticizing former, high-profile clients. Professor Lemley has free speech rights and strong opinions in this area. However, the use of the severance or termination of representation as part of that criticism is deeply problematic in my view.

*  *  *

Jonathan Turley is the Shapiro Professor of Public Interest Law at George Washington University. He is the author of “The Indispensable Right: Free Speech in an Age of Rage.”

“He who controls the money supply of a nation controls the nation.” – James Garfield

From economic history to in-depth analysis of today’s financial plumbing, last night’s MMT Vs Austrian debate assessed the roles of debt and currency within the State.

In the Austrian corner was Bob Murphy, senior fellow at the Mises Institute. Across from him, Fields Institute researcher Nathan Tankus, made the case for Modern Monetary Theory (MMT). Moderating was Jack Farley of Monetary Matters.

Here were the key moments:

Austrians & The Great Depression: The Textbooks Lied

Did “free market excesses” cause The Great Depression? This is what Americans learn in public school. Murphy, however, provided counterpoints to the narrative. Principally, Herbert Hoover was not laissez faire:

“Contrary to what people may have heard, Herbert Hoover had the largest peacetime deficits in US history up to that point. And then FDR came and his new deal really just expanded upon what Hoover did.”

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— ZeroHedge Debates (@zerohedgeDebate) January 17, 2025

MMT & Central Planning: Carbon Taxes?

Government must curb people’s behavior. That is the argument from Tankus during his opening remarks, saying Climate Change necessitates a “massive mobilization of resources.” 

“The private sector and some fancy price game is not going to be the thing that  makes decisions about how our electricity grid works,” he said. “We kind of have to make choices on how our electricity grid works.”

According to Tankus, by shifting the understanding of money from conventional budget-constraint focus to the inflation-constrained view, these mass changes in human choices can be achieved.

“You need to make design choices to incentivize certain outcomes… we need public money to incentivize people to make choices.”

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— ZeroHedge Debates (@zerohedgeDebate) January 17, 2025

Asked how to deal with climate change without government, Murphy said he does not believe it is an existential threat nor would he put his faith in government if it were.

“If the governments of the world limited global warming to 1.5 degrees Celsius, that would be worse for humanity than doing nothing.”

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— ZeroHedge Debates (@zerohedgeDebate) January 17, 2025

Watch the full debate below:

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