No Occupancy
Note: ASD will be off next week for the holiday, back Dec 1.
Elections
Those of you fortunate enough to not be on a dozen different candidate spam text lists may not have noticed, but America had elections last week. Control of legislatures was decided, a few governors were elected or reelected, and a bunch of school boards turned over.
Someone not steeped in American politics might ask - school boards? We elect those? Why does anyone outside the school district care? In part, school boards have been in the news because for the last two years we’ve been running the experiment of ‘what if we elected complete lunatics to run them?’
The most notable example of this are the Moms for Liberty, a far-right organization founded in 2021 by two former Florida school board members. Initially the group fought COVID-19 health regulations, but it quickly expanded into a catch-all for culture war grievances - anti-LGBTQ+ policies rhetoric, banning books, and spreading dangerous conspiracies.
In 2022, when the movement was gaining momentum, the group and other like-minded local activists made it onto a bunch of school boards. We discussed one example in these pages:
Unsurprisingly, using criteria as broad as “wants to reopen schools” meant [Paul] Martino also backed people spewing dangerous nonsense like QAnon conspiracies, but hey, whatever works, right?
When a local millionaire wanted to get a bunch of anti-mask, anti-lockdowners installed in Bucks County, PA, he cut some checks and got his wish. Problem was, as pandemic restrictions eased the people he’d helped elevate didn’t stop there. Across the country, school boards turned to the task of pushing a far more insidious agenda.
Last week, voters decided they’d had enough:
But Tuesday didn’t go so well for Moms for Liberty and its “parental rights” allies. The biggest letdown for the right was in the Central Bucks School District in Pennsylvania, where Democrats won five seats and seized control of the board from Republicans, defeating candidates Moms for Liberty recommended in its voting guide.
[…]
And in Pennridge, another school district in Bucks County, all five open seats went to Democrats.
People may have felt some sympathy with the original batch of angry moms who just wanted their kids back in classrooms, as the height of the pandemic put parents of school-age children under serious strain. But once they had some time to sit with all the other ideas these activists had about how to run schools, they backed hastily away.
A more moderate, fleece-vested version of Moms for Liberty is Glenn Youngkin in Virginia, who won the governorship in 2021 on a campaign of ‘parents’ rights’ that appealed to suburban moms in the DC metro. Gallons of pundit ink were spilled crowning Loudon County, VA a bellwether for growing GOP support among parents concerned about the woke mind virus infecting their vulnerable spawn. Again, voters had different ideas:
Another high-profile win for Democrats came in the school board race in Loudoun County, Virginia, where Democrats won a six-seat majority on the nine-seat board and three candidates backed by Moms for Liberty lost.
More broadly, Youngkin’s message and millions in spending on state races fell flat:
Democrats seized victory in Virginia on Election Day as voters flipped the House of Delegates out of Republican control and enabled Democrats to hold the number advantage in the State Senate. All 140 legislative seats in the state were up for grabs in the battleground election.
Elsewhere, the GOP’s war against women saw abortion rights enshrined in Ohio, a Democratic governor reelected in Kentucky, and Pennsylvania solidify a liberal majority on its Supreme Court. Republican hopes their culture war message would resonate with worried parents failed to bear fruit, in part because the messaging sounds insane to normal people, who do not want their kid's school to ban books, oppress gay students, or exist in a perpetual state of outrage at a sea of perceived grievances.
Politicians
Speaking of political experiments, it feels like America is in the process of recalibrating how we view public corruption. When I say ‘America’ I am, of course, referring to our legal system, which has become far more amenable to bribery in recent years.
This change in the rules presents politicians with a host of options, new ways to enrich themselves and their friends while avoiding pesky consequences like jail or eviction from office. It is worth noting, however, that there do still appear to be some groups you should not take money from.
If you were, hypothetically, a local politician with mayoral ambitions, and you had access to the city’s many criminal-adjacent constituencies - real estate developers, police unions, etc - would you be content to accept money and favors from them (legal, probably), or would you also take money from, let’s say, a foreign government in what literally any lawyer could tell you is an illegal election scheme?
If your answer is ‘yes, obviously’, you might be qualified to be New York’s next mayor:
F.B.I. agents seized Mayor Eric Adams’s electronic devices early this week in what appeared to be a dramatic escalation of a criminal inquiry into whether his 2021 campaign conspired with the Turkish government and others to funnel money into its coffers.
If you are walking down the sidewalk as the mayor of a major city and the FBI stops you, asks you to get into a nearby black SUV, and takes your phone(s) and iPad, it’s not a fantastic look. Adams is suspected of taking money from the Turkish government in exchange for doing shit like this:
After winning the Democratic mayoral primary in July, Mr. Adams contacted then-Fire Commissioner Daniel A. Nigro in late summer 2021 and urged him to allow the Turkish government to occupy the building at least on a temporary basis. The building had yet to open because fire officials had cited safety issues and declined to sign off on its occupancy, the people said.
Again, I am certain Adams took copious volumes of campaign cash from the city’s seediest restaurant owners and cornucopia of fraudsters, but the Supreme Court doesn’t have a problem with that! He could have called the fire commissioner to let them occupy a building with safety issues, and it would have been fine. Why fuck with Erdogan? I don’t get it.
A different kind of thing you can do if you want to become a US Senator is make sure it’s your companies engaging in financial fraud, and not you personally. Jim Justice, current governor of West Virginia and shoo-in candidate for Senate now that Joe Manchin has dropped out of the race, took a lot of money from Greensill Capital before it collapsed. At the time, I wrote:
Greensill basically started offering payday loans to US companies, based on “prospective” sales that were in no way guaranteed. And Justice took out almost a billion dollars’ worth.
What did Justice’s companies do with that money? Unclear! But they certainly did not use it to pay off creditors:
Justice’s ever-growing list of loan debts, unpaid court settlements and other outstanding bills has become too lengthy to summarize succinctly. Suffice to say, it’s in the hundreds of millions of dollars, and continually stiffed banks and creditors have gotten creative enough to seek garnishment of Justice’s state pay as governor and seize a company helicopter so they can collect what they’re owed.
Again, this is not illegal or even disqualifying to become a US Senator, and the fact Justice has been a comically corrupt governor doesn’t appear to have any impact on his chances. He is embroiled in so many lawsuits and court cases he’s publicly insisting he is broke to avoid perjury, but nonetheless had a healthy lead in recent polling and decent favorables within the state. ‘We want the broke, corrupt coal baron,’ said the people of West Virginia, apparently.
So, we’ve established that you should not do campaign finance crimes with foreign governments, you can do financial fraud as long as it’s through companies you own, but what if you were to do crimes in your own name, before you took office?
In that case, a House ethics panel might write a ‘scathing’ report about you and refer your case to the DoJ, who by the way has already indicted you for 23 counts of fraud:
The panel said that Santos knowingly caused his campaign committee to file false or incomplete reports with the Federal Election Commission; used campaign funds for personal purposes; and engaged in violations of the Ethics in Government Act as it relates to financial disclosure statements filed with the House.
George, to his credit, appears to still be living his best life, hanging with babies, vociferously denying the many crimes of which he stands accused. It is absolutely wild that we have been covering Santos in this newsletter for almost a year and he is not only still in office but has exhausted his fellow Congresspeople so completely that they can’t muster a vote to boot him out and even the Ethics Committee is like, eh, whatever, we’re sick of this fuckin’ guy:
The report says that an investigative subcommittee decided to forgo bringing formal charges because it would have resulted in a “lengthy trial-like public adjudication and sanctions hearing” that only would have given Santos “further opportunity to delay any accountability.”
The Supreme Court rulings may yet embolden a new generation of corrupt politicians, and flood our politics with open graft and bribery, but there are still some rules to pay attention to.
(note: literally an hour after I finished writing this Santos announced he will not seek reelection which is something, I guess)
Last week we talked about the revelations coming out of Amazon’s antitrust trial. Google is also in the midst of a case, which we’ve covered as well. Despite my general cynicism towards tech giants eventually facing a real reckoning in the courts, the information being revealed in filings should be shocking enough to the general public that perhaps opinion will shift enough to get someone to do something.
This week, it was inadvertently revealed that not only does the search giant pay at least $18 billion a year to Apple to be the default search on iPhones, it pays another 36% of the search revenue generated from Safari browsers:
That figure was apparently not supposed to be disclosed in open court, but a witness mentioned it, leading Google's lawyer to "visibly cringe." (Alphabet CEO Sundar Pichai confirmed the number on Tuesday in testimony for a different antitrust lawsuit.)
For context, Google charges app developers 30% of revenue to use its Play Store - the focus of a different lawsuit against the company - and cut a worse deal for itself with Apple, delivering billions more in largesse for…reasons? The eighteen bil a year wasn’t enough to placate Tim Cook, I guess? One problem with a company like Google having a stranglehold monopoly on search advertising is it can then just pay other companies tens of billions to keep it.
And, the company’s app store monopoly allows it to give sweetheart deals to other tech firms:
[Google attorney Glenn] Pomerantz argued that the court should seal portions of an upcoming exhibit revealing Google’s User Choice Billing agreement with Spotify — which lets Spotify use its own payment system for subscriptions while still giving Google a cut.
One problem with companies like Google and Apple having iron-fisted control over the apps on their phones is they can offer unfairly advantageous deals to their tech buddies, while onerous fees help stifle innovation among start-ups and app developers who don’t have a 9-figure rolodex.
Unions
There are some people companies like Google and Apple do not want to give any sort of financial concession - the armies of contractors they employ through staffing firms. For years Google operated a well-documented caste system on its campus, with contractors given different colored badges denying them access to perks and freedom of movement.
When we last talked about unions, an NLRB rule change had given organizers hope they could finally force intransigent employers to recognize unions and force them to the bargaining table.
Another new NLRB rule could make even bigger waves in the American labor movement - announced standards for establishing when companies are ‘joint employers’:
…the rule could widen the number of companies that must participate in labor negotiations alongside their franchisees or independent contractors. For example, it might require Burger King to bargain with workers even though most of its U.S. restaurants are owned by franchisees. Or it could require Amazon to negotiate with delivery drivers who are employed by independent contractors.
This rule - if it doesn’t get watered down by corporate-friendly courts - would be huge for the two-tiered caste system American capitalism has spent decades enforcing on typically low wage but increasingly even skilled professions like lawyers and engineers. Tech giants have taken advantage of armies of contract labor to avoid both labor costs and legal liability. Unsurprisingly, franchise trade groups and hotel owners have already sued to block the regulatory change.
Elsewhere in unions, Swedish workers across multiple industries are blockading Tesla over the country’s refusal to deal with its unions:
Swedish workers are uniting against Tesla. From tomorrow, cleaners will stop cleaning Tesla showrooms, electricians won’t fix the company’s charging points, and dockworkers will refuse to unload Tesla cargo at all Swedish ports.
Sweden is Tesla’s fifth-largest market in Europe, and surely its cars sitting on cargo ships will impact its bottom line. Interestingly, the last time Swedish unions took a collective stand against a company was the now-defunct Toys R Us in 1995 - a three-month strike eventually forced the company to cave. Will America’s most morally repugnant, stubborn billionaire triumph against the entire workforce of a Scandinavian country? I wouldn’t bet against the Swedes.
Lawyers
Often, when we are talking about lawyers around these parts, it is not in the most flattering terms. Lawyers are especially adept at ending up as the sole beneficiaries of bad situations, extracting money from wrongdoers and/or victims, with little concern for justice.
Sometimes, though, lawyers extracting money from two opposing sets of wrongdoers can be very funny:
JPMorgan Chase & Co. said it’s being overbilled by an “army” of lawyers working for Charlie Javice, the onetime entrepreneur accused of defrauding the bank in a $175 million buyout of her college-loan-planning site.
Javice has a team of three law firms working on her defense, with a total of 77 attorneys representing her, the bank said in a filing in Delaware Chancery Court that was made public Monday. Her lead lawyer, Alex Spiro, is charging the bank $2,025 an hour to defend her against both criminal charges and the bank’s lawsuit over the deal, the unsealed filing shows.
Ahahahahaha, I love it. If you are unfamiliar, Charlie Javice sold JPMorgan her company Frank last year, and it turned out she had falsified its user base by a factor of ten. But, because of the way these things work - and, let’s be honest, because JPM did little to no due diligence - the bank is on the hook for Javice’s legal bills via the sale agreement.
If you were in Javice’s situation - she’s also facing federal fraud charges - would you not hire three law firms and 77 lawyers with house money? Would you not tell your lawyer to bill two grand an hour for his time? Who cares! This is all a rounding error for Chase, but it is a very funny one.
Short Cons
Vox - “It’s the first time in its history that the Court has published a formal ethics code — but the introduction to this particular code makes it clear that the justices did so only reluctantly, and that they don’t actually intend for anything to change.”
USA Today - “These cases, and many more, share a common link: The victim of each threat had also been targeted, in the days before, by the enormously popular conservative social media channel Libs of TikTok.”
TechCrunch - “Starting Monday across the U.S., Uber will roll out a technology that identifies riders or Uber Eats customers who consistently give bad ratings or feedback with the intent of getting a refund. Allegations by those customers, the company said in a blog post, won’t be considered in drivers’ ratings or deactivation decisions.”
CNN - “But now, retailers are rethinking self-checkout. They have found that self-checkout leads to higher merchandise losses from customer errors and intentional shoplifting — known as “shrink” — than human cashiers ringing up customers.”
NYT - “The creature was eventually hidden under layers of paint and varnish, creating mystery around the painting until this year, when the demon resurfaced after a restoration project by the National Trust, an English conservation charity.”
Insider - “"Tesla may seek injunctive relief to prevent the transfer of title of the Vehicle or demand liquidated damages from you in the amount of $50,000 or the value received as consideration for the sale or transfer, whichever is greater. Tesla may also refuse to sell you any future vehicles," it says.”
VICE - “I have no idea if the Cybertruck will sell. Another infamous entertainer, P.T. Barnum, is widely associated with the saying “There’s a sucker born every minute,” which leaves an awful lot of possibilities for a shameless self-promoter like Musk to make a buck.”
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