WEBVTT - Trump Administration is Soft on White Collar Crime 0:00:00.560 --> 0:00:05.360 This is Bloomberg Law with June Grassoe from Bloomberg Radio. 0:00:06.160 --> 0:00:10.000 You may remember back in six when Prett Barrara, then 0:00:10.039 --> 0:00:12.640 the U S. Attorney for the Southern District of New York, 0:00:13.000 --> 0:00:17.520 issued a warning to Wall Street Today, tomorrow, next week, 0:00:17.840 --> 0:00:21.680 the week after cribbleged Wall Street insiders who are considering 0:00:21.720 --> 0:00:25.400 breaking the law will have to ask themselves an important 0:00:25.480 --> 0:00:30.120 question is law enforcement listening? A slew of insider trading 0:00:30.160 --> 0:00:34.680 convictions followed cementing Barrara's nickname as the Sheriff of Wall Street. 0:00:34.960 --> 0:00:38.159 But the sheriff is gone and the Trump administration is 0:00:38.200 --> 0:00:42.960 apparently not interested in filling the position. The prosecution of 0:00:43.000 --> 0:00:45.920 white collar crime has hidden all time low during the 0:00:45.920 --> 0:00:50.199 Trump administration, down thirty for Trump's first three years in 0:00:50.280 --> 0:00:54.080 office from the average under President Barack Obama, according to 0:00:54.160 --> 0:00:57.600 data from Syracuse University. Joining me is John Coffee, a 0:00:57.680 --> 0:01:01.320 professor Columbia Law School. His new book is Corporate Crime 0:01:01.400 --> 0:01:05.400 and Punishment, The Crisis of Under Enforcement. Jack, how would 0:01:05.440 --> 0:01:09.280 you characterize the drop in the white color crime numbers. Well, 0:01:09.280 --> 0:01:12.680 I think it's the enforcement. Generally. You can look at 0:01:12.720 --> 0:01:16.000 the number of dependants who are prosecuted way down. You 0:01:16.040 --> 0:01:19.120 can look at the fines that are imposed on corporations 0:01:19.160 --> 0:01:23.200 down by sevent You can look at new policies that 0:01:23.319 --> 0:01:25.640 say you don't have to do much to get credit 0:01:25.680 --> 0:01:28.760 for a compliance plan. It used to be, for example, 0:01:28.880 --> 0:01:32.559 that the Anti Trust pass in price fixing would only 0:01:32.640 --> 0:01:35.399 grant your leniency if you made a complete, in total 0:01:35.480 --> 0:01:38.640 confession and you were the first to confess. That's all 0:01:38.680 --> 0:01:41.600 been thrown out recently by the Trump administration. And as 0:01:41.640 --> 0:01:45.400 long as you adopt a reasonably credible compliance plan, you 0:01:45.440 --> 0:01:49.559 can get very substantial sentencing leniency, even for a crime 0:01:49.640 --> 0:01:52.920 like price fixing, which is extremely hard to detect. I 0:01:52.920 --> 0:01:56.200 can give you examples on all kinds of areas in 0:01:56.320 --> 0:01:58.920 terms of the numbers or in terms of the policy changes. 0:01:59.440 --> 0:02:03.320 But the government is going much much easier and softer, 0:02:03.800 --> 0:02:08.280 both criminally and civilly against corporations to commit on lawcal conduct. 0:02:08.560 --> 0:02:11.000 Do we blame the president for this or is it 0:02:11.120 --> 0:02:15.040 someone lower down in the chain? Well, that's a good question, man. 0:02:15.080 --> 0:02:18.840 I would tell you the first thing about organizational behavior 0:02:18.880 --> 0:02:23.800 corporations or other organizations is that the critical variable is 0:02:23.919 --> 0:02:27.280 tone at the top. And the United States governed today, 0:02:27.400 --> 0:02:30.440 the tone set by the top by the president is 0:02:30.520 --> 0:02:34.080 that law compliance isn't that important. It's a minor virtue 0:02:34.080 --> 0:02:36.920 at best, and don't get yourself hung up on it. 0:02:37.000 --> 0:02:40.320 Get the job done. So I think that there is 0:02:40.360 --> 0:02:44.359 an implicit signal from the top which lower levels always 0:02:44.400 --> 0:02:48.040 copy that law compliance is not the government's first concern. 0:02:48.760 --> 0:02:51.880 Let's look at a few different areas of white color crime, 0:02:52.080 --> 0:02:55.840 starting with securities fraud cases. Well, we're saying them go 0:02:55.880 --> 0:02:59.440 down and understand, for the last six months there has 0:02:59.480 --> 0:03:03.880 been the COVID nineteen crisis and most court houses are shut. 0:03:04.000 --> 0:03:06.720 So I do know that there are a number of cases, 0:03:06.880 --> 0:03:09.600 some of which I've worked with the prosecution on, which 0:03:09.600 --> 0:03:12.760 are delayed until the courts can reopen. That will create 0:03:13.320 --> 0:03:17.280 something of a statistical artifact. But in general, I think 0:03:17.320 --> 0:03:21.440 the government is reallocating troops away from securities fraud, any 0:03:21.440 --> 0:03:24.720 trust fraud, to things the government cares more about, such 0:03:24.760 --> 0:03:29.840 as immigration cases, alleged terrorism cases, other cases that they 0:03:29.840 --> 0:03:33.519 are concerned with the first three years of the Trump administration. 0:03:33.720 --> 0:03:36.520 This comes from data assembled by a group of Syracuse 0:03:36.680 --> 0:03:39.760 University with the number of white color dependence during the 0:03:40.000 --> 0:03:44.360 first three years spelled by that's a real decline because 0:03:44.440 --> 0:03:47.760 there had been a significant increase for a while under 0:03:47.800 --> 0:03:53.040 the Obama administration. Now, the Justice Department has criticized that 0:03:53.520 --> 0:03:58.360 tract data, saying it routinely differs from other reporting, for example, 0:03:58.440 --> 0:04:01.040 from the U. S. Attorney's Office, And they say that 0:04:01.080 --> 0:04:05.280 the Department hasn't eased up on white collar crime. Well, actually, 0:04:05.320 --> 0:04:09.880 the government's official statistics are only slightly different TRACK, which 0:04:10.000 --> 0:04:14.440 stands for Transactional Report Access Clearing Out. It's a watchdog 0:04:14.560 --> 0:04:17.240 looking at Justice Department, and they're not loved by Justice. 0:04:17.560 --> 0:04:19.920 No one loves to be watched. They say the number 0:04:19.920 --> 0:04:23.120 of dependents is down by and the studies by the 0:04:23.240 --> 0:04:27.800 attorneys say it's down by not a huge difference. So 0:04:27.960 --> 0:04:33.080 is it that the FBI is not investigating these crimes anymore, 0:04:33.160 --> 0:04:36.000 they're just letting it go by. Well, I would say 0:04:36.040 --> 0:04:40.640 most of US attorneys use the FBI or other enforcement agencies, 0:04:40.880 --> 0:04:43.920 but they've got to allocate their own manpower. If at 0:04:43.960 --> 0:04:46.400 one point in time you had twenty people in the 0:04:46.480 --> 0:04:49.080 securities fraud Unit in the Southern District and you were 0:04:49.120 --> 0:04:52.400 to reduce it to ten, you're going to cut the 0:04:52.440 --> 0:04:55.680 manpower that can prosecute these cases by fifty percent, and 0:04:55.720 --> 0:04:58.719 there will be a decline, So it could be part 0:04:58.720 --> 0:05:01.880 of the FBI, but I think it's more the manpower 0:05:01.920 --> 0:05:05.479 and what they're given is their priority. Some observers say 0:05:05.520 --> 0:05:09.919 that though there's a downturn in white collar prosecutions, there's 0:05:09.960 --> 0:05:14.080 an optick in immigration prosecutions. Well, I agree with that, 0:05:14.160 --> 0:05:17.120 but that's because you're allocating the truths differently if you 0:05:17.200 --> 0:05:19.920 take your man power. Let's suppose the U. S Attorney 0:05:19.960 --> 0:05:22.839 has a hundred lawyers under his command, and when he 0:05:22.920 --> 0:05:26.120 started he had twenty five with him in white collar crime, 0:05:26.520 --> 0:05:28.839 and after two years he shifts well with them out 0:05:28.839 --> 0:05:31.600 and puts them over in immigration or terrorism cases. Are 0:05:31.680 --> 0:05:35.680 organized crime cases, you're going to have a consequent declimb 0:05:35.760 --> 0:05:39.000 because there are less people they're investigating, and you only 0:05:39.040 --> 0:05:43.200 prosecute what you investigate. What about money laundering, Well, there 0:05:43.200 --> 0:05:46.120 has been a decline of money laundering cases. Money laundering 0:05:46.279 --> 0:05:50.080 is unique because the prosecution can charge that pretty much 0:05:50.080 --> 0:05:53.000 when it wants. It's a very easy crime to allege 0:05:53.040 --> 0:05:57.240 if you found other felonies, and by eliminating money learning prosecutions, 0:05:57.320 --> 0:06:01.039 you are again being more lenient on incorporation and why 0:06:01.200 --> 0:06:05.000 Well that's speculative. It could well be the Trump administration 0:06:05.120 --> 0:06:08.560 believes that the stock market is the most important achievement 0:06:08.640 --> 0:06:11.960 they have and they don't want to prosecute public corporations. 0:06:12.000 --> 0:06:15.200 And because the market go down, that's all speculative. What 0:06:15.320 --> 0:06:18.080 I can tell you is they've changed their requirements and 0:06:18.120 --> 0:06:21.320 it is now much easier to get leniency. At the 0:06:21.400 --> 0:06:25.400 end of the Obama administration, they were somewhat embarrassed by 0:06:25.400 --> 0:06:27.640 the fact that no one at a senior level at 0:06:27.640 --> 0:06:30.880 a Wall Street firm was prosecuted during the two thousand 0:06:30.920 --> 0:06:33.640 eight or because of the two thousand eight What I 0:06:33.640 --> 0:06:36.480 can tell you is they've changed their requirements and it 0:06:36.560 --> 0:06:39.800 is now much easier to get leniency. At the end 0:06:39.839 --> 0:06:43.479 of the Obama administration, they were somewhat embarrassed by the 0:06:43.520 --> 0:06:45.640 fact that no one at a senior level at a 0:06:45.680 --> 0:06:49.080 Wall Street firm was prosecuted during the two thousand eight 0:06:49.160 --> 0:06:51.840 or because of the two thousand and eight crisis. So 0:06:51.880 --> 0:06:56.599 they adopted something called the Yates Memorandum, named after Sally Yates, 0:06:56.640 --> 0:06:59.320 who was the Deputy Attorney General, and it said we're 0:06:59.320 --> 0:07:03.120 no longer to give you a deferred prosecution agreement, which 0:07:03.120 --> 0:07:06.960 is a probation like discharge unless you do a complete 0:07:06.960 --> 0:07:11.000 study and identify absolutely everyone who was involved, so we'll 0:07:11.000 --> 0:07:13.440 know who the officers are that we can prosecute. And 0:07:13.440 --> 0:07:16.800 this was an all or nothing policy, identify everyone. Well, 0:07:16.840 --> 0:07:19.240 the Trump administration comes in and they change it and 0:07:19.280 --> 0:07:21.960 they say, you only have to identify people who are 0:07:22.000 --> 0:07:26.080 substantially involved in the crime. What does that mean. It 0:07:26.120 --> 0:07:29.040 means if there's an investigation by a private law firm 0:07:29.120 --> 0:07:31.360 hired by the company to see what happened and make 0:07:31.360 --> 0:07:34.160 a report to the government, they can say, well, the 0:07:34.200 --> 0:07:36.960 only people who paid the bribe for these assistant vice 0:07:37.000 --> 0:07:40.840 presidents overseas, and while maybe the CEO and maybe the 0:07:40.920 --> 0:07:45.640 chief financial officer knew something about this, they weren't substantially involved. 0:07:45.800 --> 0:07:49.280 And that's a very easy rationalization by which you can 0:07:49.360 --> 0:07:53.120 exclude the most senior people and thereby make sure that 0:07:53.240 --> 0:07:55.520 justice will stop at a half white point. It's a 0:07:55.600 --> 0:08:00.000 significant change that the Trump administration put into effectively unwanted 0:08:00.000 --> 0:08:03.280 in the Eighth Memorandum. They've done this in other areas too. 0:08:03.520 --> 0:08:06.480 For the last seventy years, the US government has had 0:08:06.480 --> 0:08:10.400 a special policy towards any trust price fixing. Any trust 0:08:10.400 --> 0:08:13.560 price fixing is very hard to detect, but it always 0:08:13.560 --> 0:08:17.000 involves the conspiracy. One firm can't do it alone. And 0:08:17.080 --> 0:08:19.600 so the positive for seventy years is we will give 0:08:19.640 --> 0:08:23.240 you leniency, but only if you make a complete confession, 0:08:23.320 --> 0:08:26.880 and you are the first to confess. The business community 0:08:27.000 --> 0:08:31.240 always disliked that, but companies did make those complete confessions 0:08:31.480 --> 0:08:34.559 and god immunity for themselves and their officers. Well, the 0:08:34.559 --> 0:08:37.800 Trump administration has abolished that. They will now say that 0:08:37.840 --> 0:08:40.600 while you can still get complete credit, will give you 0:08:40.800 --> 0:08:45.040 substantial sentencing leniency, great credit if you just adopt a 0:08:45.120 --> 0:08:49.280 credible compliance plan, not the substantial watering down. It means 0:08:49.320 --> 0:08:52.440 that price fixing cases are less likely to begin with 0:08:52.559 --> 0:08:55.559 corporate confessions. We can go through half a dozen of 0:08:55.600 --> 0:08:58.240 these things. Just to give you one more. It used 0:08:58.280 --> 0:09:01.360 to be that there were deferred execution agreements, and the 0:09:01.360 --> 0:09:04.280 defense bar wanted more. So they pushed for something called 0:09:04.400 --> 0:09:07.520 non prosecution agreements, under which no court is involved. You 0:09:07.600 --> 0:09:10.720 just agree with the prosecution that they won't prosecute you. 0:09:11.080 --> 0:09:13.679 And now they've gone one step further. There's something called 0:09:14.160 --> 0:09:18.480 declinations with discouragement. And here the government sort of salute you, 0:09:18.760 --> 0:09:22.000 y say, we think your cooperation was so terrific, so 0:09:22.080 --> 0:09:25.120 wonderful that we're going to decline to prosecute you. We 0:09:25.160 --> 0:09:27.600 will require you to pay back the ill, not gains 0:09:27.640 --> 0:09:30.760 to discoorge them. But that's sort of a lesser disposition, 0:09:30.800 --> 0:09:34.240 which the government salute you for your cooperation. That's new 0:09:34.280 --> 0:09:36.400 with Trump. I can give you two or three more, 0:09:36.440 --> 0:09:39.960 but you're getting the picture. Yes, Absolutely, cracking down on 0:09:40.080 --> 0:09:45.880 financial fraud led to reforms and increase corporate compliance. What 0:09:46.080 --> 0:09:50.040 is this, uh, non prosecution leading to Well, again, there 0:09:50.040 --> 0:09:53.240 were two steps to bird prosecution. Non prosecution, which has 0:09:53.280 --> 0:09:55.400 been around for six or seven years and not not 0:09:55.640 --> 0:09:58.400 unique to Trump, but Trump is using it much more. 0:09:58.440 --> 0:10:02.080 It's a lesser disposition under which you don't have to 0:10:02.160 --> 0:10:04.920 admit guilt, you don't have any public document, you have 0:10:05.000 --> 0:10:08.120 no court or judge involved, and both of those things 0:10:08.240 --> 0:10:11.280 mean a little bit more accountability. Uh. It used to 0:10:11.280 --> 0:10:14.240 be under deferred prosecution agreements, it was normal that the 0:10:14.280 --> 0:10:16.880 government would require you to put to appoint a monitor, 0:10:17.040 --> 0:10:20.880 some outside expert who would review the area of misbehavior 0:10:21.200 --> 0:10:24.920 and constantly surveil and tell the government who found that 0:10:25.000 --> 0:10:28.280 there was any sign of continuing activity, that anyone illegal 0:10:28.320 --> 0:10:32.640 conduct or suspicious conduct. The Trump administration has said monitors 0:10:32.640 --> 0:10:36.280 are no longer required, and they are disappearing. I don't 0:10:36.280 --> 0:10:38.760 think there ever were a perfect solution, but there were 0:10:38.760 --> 0:10:42.080 one more little step that's gone. I'm wondering, is there 0:10:42.120 --> 0:10:46.520 any effect to be seen yet our corporations engaging in 0:10:46.640 --> 0:10:51.920 more criminal behavior because there's no enforcement. No, of course, 0:10:51.960 --> 0:10:54.040 no one's going to confess to that. No one's going 0:10:54.080 --> 0:10:56.400 to say, of course, we're engaging a more criminal behavior. 0:10:56.800 --> 0:11:00.080 But they think the government's behaving much more reasonably. And 0:11:00.080 --> 0:11:03.000 when dependants think the prosecutor is being reasonable, I think 0:11:03.000 --> 0:11:05.080 it means it's a very light touch and we're not 0:11:05.200 --> 0:11:09.360 getting the harder attitude that we saw at various points 0:11:09.679 --> 0:11:14.199 back under the Obama administration. Now, how much is dependent 0:11:14.400 --> 0:11:17.199 on who the U. S. Attorney is in the Southern District, 0:11:17.200 --> 0:11:21.240 particularly where there's a lot of white color prosecutions, because 0:11:21.559 --> 0:11:24.720 of course, you remember pret Berrara, the sheriff, so called 0:11:24.800 --> 0:11:29.040 Sheriff of Wall Street, who cracked down on insider trading. 0:11:29.640 --> 0:11:32.320 Nothing did. We don't see anything like that anymore. He 0:11:32.400 --> 0:11:35.840 deserves great credit. But actually there's been a long tradition 0:11:35.880 --> 0:11:39.679 in the Southern district. In fact, other use attorneys call 0:11:39.760 --> 0:11:43.120 them the sovereign District in New York because they always 0:11:43.320 --> 0:11:48.000 resisted main justice and followed their own very aggressive policies. 0:11:48.400 --> 0:11:51.640 But note that the last two duly appointed House Attorneys, 0:11:52.280 --> 0:11:56.199 both Preeperhara and his Republican successor, have been fired by 0:11:56.240 --> 0:11:59.280 President Trump. That's a pretty strong signal that you can't 0:11:59.280 --> 0:12:01.800 remain into and you can't go your own way. No, 0:12:01.920 --> 0:12:03.839 I don't know any place else where the government has 0:12:03.880 --> 0:12:07.240 fired two successive U S attorneys. One of the former 0:12:07.320 --> 0:12:12.400 prosecutors in the Antitrust and Fraud Division said that a 0:12:12.480 --> 0:12:17.760 lot of this non enforcement is because veterans. Veteran attorneys 0:12:17.840 --> 0:12:21.560 have left that division, and then there are younger lawyers 0:12:21.559 --> 0:12:23.840 there who really don't know yet how to put a 0:12:23.880 --> 0:12:28.760 case together. Do you think that's a valid explanation. I 0:12:28.800 --> 0:12:31.560 can't reject it. I don't know that do we have 0:12:31.800 --> 0:12:34.640 in the people in the Justice Department with the Usttorney's Office, 0:12:34.720 --> 0:12:38.080 they usually get the very best people, Supreme Court perks 0:12:38.080 --> 0:12:40.520 and the others. But it takes a while to learn 0:12:40.559 --> 0:12:43.040 your job. You can't do it fully on day one. 0:12:43.559 --> 0:12:47.280 But notice if they are leaving, why are they leaving? 0:12:47.360 --> 0:12:50.800 It might be they have been demoralized by the new policies, 0:12:50.880 --> 0:12:54.760 the new restraints, and the lack of commitment to strong enforcement. 0:12:55.320 --> 0:12:58.479 I would think I wouldn't personally as a young aggressive 0:12:58.600 --> 0:13:01.520 U S attorney or says new attorney, I don't think 0:13:01.559 --> 0:13:04.200 I'd be happy working under the Trump leadership, and I 0:13:04.280 --> 0:13:08.200 might find other employment. What is the message of your book, Well, 0:13:08.240 --> 0:13:11.560 we need to be more aggressive in different ways. The 0:13:11.640 --> 0:13:14.959 number one problem is we don't have the resources to 0:13:15.120 --> 0:13:19.040 adequately investigate all these cases. That's the principal reason why 0:13:19.120 --> 0:13:22.520 people that Leahmen and other firms were not investigated. They 0:13:22.520 --> 0:13:26.320 weren't just not prosecuted, they weren't investigated. And I think 0:13:26.360 --> 0:13:30.160 we've got to both get more resources and find ways 0:13:30.520 --> 0:13:35.200 to make the corporation much more eager to settle. Today, 0:13:35.240 --> 0:13:38.120 we have a system under which we sort of trade up. 0:13:38.200 --> 0:13:40.600 We start at the lowest level and find the lowest 0:13:40.600 --> 0:13:43.520 person and hope you'll implicate the next person, and we 0:13:43.600 --> 0:13:47.240 climb the ladder with everybody turning on the person above them. 0:13:47.360 --> 0:13:50.080 That works to a degree, but it never gets you 0:13:50.120 --> 0:13:52.520 to the very top. I think one of the things 0:13:52.520 --> 0:13:54.400 we have to do is to start at the top 0:13:54.840 --> 0:13:57.520 and tell the board of directors or its art committee 0:13:57.559 --> 0:14:00.280 that they have to take control of this investor asient 0:14:00.320 --> 0:14:03.240 and its decisions, and we will threaten you with the 0:14:03.320 --> 0:14:08.559 equivalent of a bankrupting penalty unless you identify for us 0:14:08.960 --> 0:14:13.440 who were the responsible officers, going back to identify everyone. 0:14:13.880 --> 0:14:16.200 So I think you have to negotiate from both levels, 0:14:16.200 --> 0:14:18.800 from the top down in the bottom up, trying to 0:14:18.840 --> 0:14:23.000 get the entity to identify their responsible officers. I'm a 0:14:23.040 --> 0:14:26.840 believer that we really have to get individuals held responsible 0:14:27.200 --> 0:14:31.120 and prosecuting. The corporation is a very second bad substitute. 0:14:31.840 --> 0:14:35.640 And you mentioned before the financial crisis, where you know, 0:14:35.760 --> 0:14:37.440 people kept saying and what are we going to see 0:14:37.480 --> 0:14:40.600 people in handcuffs who are really responsible? And we never did. 0:14:40.880 --> 0:14:43.600 Has there been a time in our history when's the 0:14:43.680 --> 0:14:47.760 last time prosecutors have gotten to the top? Go back 0:14:47.800 --> 0:14:51.000 and think of and Run and Worldcome two thousand one 0:14:51.080 --> 0:14:54.280 to two th three. The CEOs of both of those 0:14:54.320 --> 0:14:57.080 firms we went to prison, and the CEO of World 0:14:57.160 --> 0:15:00.320 Come was only released after twenty five years. He was 0:15:00.400 --> 0:15:03.560 terminally ill about a couple of months ago. So we 0:15:03.680 --> 0:15:07.520 have often prosecuted senior executives and around the world common 0:15:07.560 --> 0:15:10.560 it does other companies and their CEO is criminally prosecuted 0:15:10.560 --> 0:15:13.400 in jail. And that's the same thing during the Savings 0:15:13.400 --> 0:15:16.280 Bank crisis. Bank in the nineteen eighties, something like the 0:15:16.360 --> 0:15:20.400 five hundred senior bank officers went to prison for failures 0:15:20.400 --> 0:15:23.800 of small stating banks that took ridiculous risks. And in 0:15:23.960 --> 0:15:28.200 the details, the problem is the very large corporation. It's 0:15:28.240 --> 0:15:30.560 going to be a massive inqueror before you can get 0:15:30.600 --> 0:15:35.120 all the data. Sometimes thousands of people are involved in 0:15:35.160 --> 0:15:39.000 a broad policy, and that is forbidding to the government. 0:15:39.040 --> 0:15:41.480 They don't have the resources, and we've got to find 0:15:41.480 --> 0:15:44.560 ways to give them resources. One of the things I propose, 0:15:44.880 --> 0:15:48.040 which the SEC won't like at all, is the SEC 0:15:48.200 --> 0:15:52.480 is also resource constraint, and sometimes they should hire private 0:15:52.560 --> 0:15:56.160 law firms, very good private law firms on a contingency 0:15:56.320 --> 0:16:00.040 the basis to sue the dependence because the SEC and 0:16:00.200 --> 0:16:03.320 have enough manpower. But if you told a Planets law 0:16:03.360 --> 0:16:06.400 firm that they could handle this case under the direction 0:16:06.480 --> 0:16:08.960 of the SEC und the total control of the SEC, 0:16:09.440 --> 0:16:12.360 and they would get twenty five percent the recovery as 0:16:12.400 --> 0:16:15.480 their contingent fee, I think that would solve some of 0:16:15.520 --> 0:16:18.240 the resource constraints that we are now facing. That's just 0:16:18.360 --> 0:16:21.440 one of the examples. There are others. Thanks Jack. That's 0:16:21.480 --> 0:16:25.160 professor John Coffee at Columbia Law School. His new book 0:16:25.200 --> 0:16:29.280 is entitled Corporate Crime and Punishment, The Crisis of under Enforcement. 0:16:30.800 --> 0:16:33.360 President Trump is facing a battle over a set of 0:16:33.400 --> 0:16:38.160 executive actions he issued on Saturday, providing economic relief measures 0:16:38.280 --> 0:16:43.240 during the pandemic, including weekly federal unemployment payments, student loan relief, 0:16:43.320 --> 0:16:46.680 and efforts to protect tenants from eviction. With those actions, 0:16:46.800 --> 0:16:49.920 is Trump trying to rest core powers away from Congress 0:16:50.160 --> 0:16:54.680 after weeks of discussions over a second pandemic rescue package stalled. 0:16:55.200 --> 0:16:58.320 Joining me is Matt Dalla, a professor at Washington University's 0:16:58.400 --> 0:17:04.840 Graduate School of Political Management. Our President Trump's orders unprecedented 0:17:04.840 --> 0:17:09.480 in our history, Well, they're highly unusual. I wouldn't say 0:17:09.520 --> 0:17:12.800 that they're totally unprecedented in that, you know, Trump himself 0:17:12.880 --> 0:17:16.920 has created a kind of precedent for them. So for example, 0:17:17.040 --> 0:17:20.159 when he is hued at one of his first executive 0:17:20.280 --> 0:17:24.200 orders out of Blue with the travel band early on 0:17:24.280 --> 0:17:27.600 into the so called Muslim Band, that was an executive 0:17:27.720 --> 0:17:30.879 order that actually he had to revise multiple times. And 0:17:30.960 --> 0:17:35.160 that's so chaoff at airports across the country. I think 0:17:35.200 --> 0:17:38.240 that there are also uh, He's also set a precedent 0:17:38.359 --> 0:17:44.560 when is a failure to reach an accommodation with Congress 0:17:44.640 --> 0:17:49.000 on his wall. After weeks of trying to negotiate and 0:17:49.040 --> 0:17:53.359 then failing to reach an agreement, he issued an emergency 0:17:53.440 --> 0:17:57.560 declaration and tried to repurpose the money from the Defense 0:17:57.640 --> 0:18:00.399 Department in other places to build the wall. So, you know, 0:18:00.440 --> 0:18:03.520 even though the circumstances are a bit different, I think 0:18:03.640 --> 0:18:07.480 that what he's done with these four, both memos and 0:18:07.520 --> 0:18:10.639 executive orders, are of a piece of how he has 0:18:10.760 --> 0:18:15.199 issued orders during his administration. But yes, before Trump, I 0:18:15.240 --> 0:18:18.640 think that, you know, as controversial as executive orders has been, 0:18:19.080 --> 0:18:22.600 you know, Trump has has really pushed the boundaries of 0:18:22.680 --> 0:18:26.680 them in ways that are highly a circumspect and unusual, 0:18:27.400 --> 0:18:31.240 and the courts haven't stopped him. The Supreme Court ended 0:18:31.320 --> 0:18:35.800 up approving the final Muslim ban, and and the Supreme 0:18:35.800 --> 0:18:39.800 Court has let Trump continue to use military funds to 0:18:39.880 --> 0:18:43.240 build the wall until that lawsuit reaches them. And we 0:18:43.280 --> 0:18:45.880 don't know what they'll do with that suit. Yeah, so 0:18:45.920 --> 0:18:48.080 we don't we don't know what they're gonna do with 0:18:48.240 --> 0:18:51.240 shoot over the wall and It's true the Supreme Court 0:18:51.280 --> 0:18:54.919 did a pold but it was a much revised band 0:18:55.400 --> 0:18:57.800 and it took quite a long time for it to 0:18:57.880 --> 0:18:59.600 work its way to the courts. And I think the 0:18:59.680 --> 0:19:02.480 Muggle band had to be revised at least a couple 0:19:02.520 --> 0:19:06.199 of times. And remember it also evoked this withering descent 0:19:06.359 --> 0:19:10.480 from Justice Sonia. So the Mayor too, I believe, likened 0:19:10.520 --> 0:19:14.000 it to the treatment of Japanese Americans during World War two, 0:19:14.160 --> 0:19:18.600 sort of a religious discrimination. Letting that stand. So you know, 0:19:18.760 --> 0:19:22.760 these are highly controversial and looks the executive orders having 0:19:22.800 --> 0:19:28.359 controversial in the past. I do think what Trump has done, 0:19:29.320 --> 0:19:33.160 in particular with the executive order about building the wall 0:19:33.240 --> 0:19:36.200 in the national emergency, and also with these recent orders 0:19:36.240 --> 0:19:41.000 and memos, is to start to infringe on the congressional 0:19:41.000 --> 0:19:45.080 power of the purse. And Congress has the constitutional authority 0:19:45.240 --> 0:19:50.200 to appropriate money, and the Trump has begun to, I think, 0:19:50.240 --> 0:19:53.639 infringe on that when he's been unable to reach these fields. 0:19:54.240 --> 0:19:58.600 Has Congress over the decades, not just during Trump, has 0:19:58.640 --> 0:20:02.439 Congress been giving more and more authority to the executive 0:20:02.520 --> 0:20:06.760 by seating more of its authority. Is that how we 0:20:06.880 --> 0:20:11.040 got to this point? Well, yeah, that's a that's a 0:20:11.200 --> 0:20:18.119 big and complicated question. But in an era of nuclear weaponry, 0:20:19.080 --> 0:20:22.440 and after two world wars, and during the Cold War, 0:20:22.560 --> 0:20:26.040 and then after nine eleven, certainly on matters of national 0:20:26.080 --> 0:20:29.880 security and foreign policy, the trend for many decades has 0:20:29.920 --> 0:20:33.879 been to seed to the president a much much greater 0:20:34.080 --> 0:20:38.000 authority and and even to the extent where Congress has 0:20:38.080 --> 0:20:42.320 voted on whether or not authorize a war, it has 0:20:42.359 --> 0:20:47.080 not been a formal declaration of war as the Constitution demands. 0:20:47.160 --> 0:20:50.280 It's been a resolution, you know, a resolution, for example, 0:20:50.320 --> 0:20:54.080 to authorize the Youth of Force Interact in two thousand, 0:20:54.320 --> 0:20:58.119 in two four, after nine eleven, the resolution to authorize 0:20:58.119 --> 0:21:00.359 a Youth of Force against Terrorism, which I believe it's 0:21:00.359 --> 0:21:03.679 still enforced and has been used to justify all sorts 0:21:03.680 --> 0:21:07.240 of military activities overseas. The other point I would make 0:21:07.320 --> 0:21:10.880 is it in a narror of partisan polarization, when Congress 0:21:10.920 --> 0:21:15.520 has been unable to reach deals, and when Congress's approval 0:21:15.600 --> 0:21:18.520 ratings are maybe at fifteen percent or sometimes even in 0:21:18.560 --> 0:21:22.680 the single digits, presidents have, you know, as Barack Obama said, 0:21:23.320 --> 0:21:27.400 after being frustrated repeatedly by Republicans in Congress, he's got 0:21:27.400 --> 0:21:29.760 a phone and a pen, and the pat of course 0:21:29.920 --> 0:21:34.919 refers to using executive orders and other executive actions. So Congress, 0:21:34.920 --> 0:21:38.240 by defaults in a way, by being unable to enact 0:21:38.400 --> 0:21:43.120 or pass major legislation, has seeded I think, uh much 0:21:43.160 --> 0:21:48.040 of it unwittingly seated much of this authority to uh 0:21:48.119 --> 0:21:50.720 to presidents and has opened the door for the kind 0:21:50.720 --> 0:21:53.919 of misshif I think that uh, and and what I 0:21:53.920 --> 0:21:58.639 think many are you unconstitutional actions by President plump. Republican 0:21:58.680 --> 0:22:02.399 Senator Ben Says said the pen and phone theory of 0:22:02.640 --> 0:22:07.919 executive lawmaking is unconstitutional slap, but he was one of 0:22:08.160 --> 0:22:12.959 very few Republicans to criticize this move. And so what 0:22:13.000 --> 0:22:16.520 are the Republicans saying by letting the president go ahead 0:22:16.560 --> 0:22:19.960 with moving military funds to a board a wall, and 0:22:20.040 --> 0:22:24.000 here redirecting funds from FEMA. The first thing is that 0:22:24.040 --> 0:22:27.240 it's the height of hypocrisy, right that the Republicans spent 0:22:27.320 --> 0:22:30.600 many years railing a President Obama for acting like a 0:22:30.720 --> 0:22:34.920 king and issuing these sorts of unconstitutional orders that were 0:22:34.920 --> 0:22:39.160 supposedly destroying freedom and individual liberty. I think what we're 0:22:39.160 --> 0:22:42.119 seeing though, now, of course, is the shoes on the 0:22:42.119 --> 0:22:46.159 other foot, and and in particular, the Republicans are headed 0:22:46.160 --> 0:22:50.959 into a very trust election year. The president is on 0:22:51.000 --> 0:22:55.160 the ballot, and I think most Republicans at the federal 0:22:55.280 --> 0:22:58.800 level feel like politically they have no choice, right that 0:22:58.960 --> 0:23:01.600 that their faith and really the power that they have 0:23:01.720 --> 0:23:05.560 in Washington and in the country. Uh and to point 0:23:05.600 --> 0:23:09.240 Supreme Court justices for example, that all that is riding 0:23:09.440 --> 0:23:13.040 on this election. And you know what, they come out 0:23:13.320 --> 0:23:17.840 like Ben Fast did and start criticizing Trump. I think 0:23:17.880 --> 0:23:19.760 that they worry that the party is going to be 0:23:19.760 --> 0:23:23.720 even further divided and it will depress their votes. Then 0:23:23.720 --> 0:23:26.560 it's Fast. Interestingly, who's up for re election. I believe 0:23:26.600 --> 0:23:30.119 in November he's already won his primer, and you know, 0:23:30.200 --> 0:23:33.520 he doesn't have a even close to competitive race, so 0:23:33.880 --> 0:23:36.560 you know, he's a little bit more politically free to 0:23:36.720 --> 0:23:40.200 issue a criticism. But yeah, I mean Republicans have really 0:23:40.480 --> 0:23:42.479 and you can say that about you know, a hundred 0:23:42.480 --> 0:23:45.520 and one different issues over the past four years where 0:23:45.520 --> 0:23:49.040 Republicans have just kind of washed their hands up. What 0:23:49.080 --> 0:23:52.119 they have said is there are their principles and seated 0:23:52.200 --> 0:23:55.320 the stage and the policies and programs the Trump even 0:23:55.320 --> 0:24:00.000 if it violates their own beliefs, we're President Obama's executive 0:24:00.240 --> 0:24:04.600 orders substantially similar to President Trump's. In other words, did 0:24:04.600 --> 0:24:08.840 he ever divert money in executive orders from one project 0:24:08.840 --> 0:24:12.639