Who Oversees the Overseers? Hopefully Congress!
Newsletter 99: From Big Pharma and Bannon to crypto bros and Zuckerberg, Congress must make sure the executive branch enforces the law.
Attorney General Merrick Garland testifies before the Senate Judiciary committee this morning where he will likely face questions about his department’s investigations into January 6. That, however, is far from the only thing demanding the committee’s oversight. Last week for The American Prospect, Andrea Beaty and I detailed how the DOJ systematically stonewalled us in order to hide the fact of former Kirkland & Ellis partner and Facebook defender Susan Davies’ role in the Office of Legal Policy (OLP). We now know that she’s been leading that office since September 3, a fact that was only disclosed on October 7. The Department still has not answered our follow-up questions to learn if Davies was working in the OLP or elsewhere in the DOJ prior to that point.
For the piece, we explained why it’s so concerning that Davies, who was passed over for the Antitrust position, is in this important role. Just a week later, we already have another possible reason to add to the list. On Monday, the White House announced that it had determined it did not have the power to unilaterally share Moderna’s vaccine IP, despite its sizable investments in the vaccine’s development. Although it was framed as a White House decision, it is all but certain that key offices within the DOJ, the OLP likely among them, weighed in. So how well can Susan Davies be trusted to have put the public interest before pharmaceutical companies profits in this case? The short answer is, we don’t know. Kirkland & Ellis regularly represents pharmaceutical clients, so it’s very possible that Davies is conflicted. But we can’t say for sure because Davies’ financial disclosures are not automatically available through OGE and our FOIA request for them, filed in June, has been subject to extensive delays. Note that it is only thanks to the fact that we heard rumors of Davies employment earlier this year that we filed that request. Had we awaited official confirmation, we would just be at the very beginning of the months-long process to obtain her records now.
Governance:
There are still other matters that the Judiciary committee would do well to press Garland on. Why, for example, did his department fail to reinstate charges against Paul Manafort, who is currently selling millions of dollars of property that should have been forfeited? Why is it expending resources seeking to overturn a preliminary injunction the ACLU won on behalf of migrant clients subject to MPP? Or, why is it defending Betsy DeVos’ harsh standards for defrauded student borrowers?
As we’ve emphasized before, we do not believe that this Justice Department should treat Trump-era legal positions with anything but scorn. Everything we know about the processes by which those decisions were reached suggests that they were all political hack jobs (incidentally, this is not exclusive to the DOJ, as a recent scoop from Politico about Trump-era Acting Comptroller Brian Brooks’ hidden move to greenlight crypto bank holdings illustrates). Treating them as if they aren’t does nothing to solve the problem, but results in significant real-life harm. We continue to worry that this same desire to remain supposedly apolitical will also lead Garland to conclude that it’s better to decline to prosecute Bannon for contempt of Congress. Needless to say that would be an astonishing blow for accountability.
Senators should also ask Garland to elaborate on his comments last week to the House Judiciary committee in which he suggested that it was a lack of capacity that was preventing his Department from pursuing more voting rights cases. With an omnibus spending bill still in the works, now is the time for lawmakers to be gauging what sort of funding increases will be necessary to fill the capacity gap. Is what has been proposed enough to vigorously enforce voting rights (and carry out the Department’s other responsibilities)? If not, Garland should be making that case now. We at RDP plan to do a deep dive on this to judge for ourselves. Please get in touch if you have thoughts on funding DOJ enforcement capacity or are interested in hearing more about what we find.
Climate Finance:
The Financial Stability Oversight Council released its long-awaited report on climate-related financial risk last Thursday, the culmination of precious months of study and discussion. The final product is nothing short of pitiful. There is international consensus on what must be accomplished by 2030 to forestall ever accelerating climate change. With less than 100 months to take the steps necessary to avoid climate catastrophe, FSOC took valuable time to assemble a report that recommends no substantive action to mitigate the financing of climate risk. It doesn’t even acknowledge fossil fuels as a driver of climate change. As Jeff Hauser observed in his statement following the release: “A terse summary of the report would read ‘it’s good to notice that our planet is burning, but we won’t do anything to fix it.’”
How did this happen? Yellen, who leads FSOC and is thus the main figure responsible for this, has been consistently disappointing on matters of climate finance. However, we have reason to believe that there’s an additional factor that made this report even more so: Federal Reserve Chair Jerome Powell. As my colleague Dorothy Slater detailed for our blog yesterday, Yellen appears to be “covering for Fed Chair Jerome Powell, whose term expires in February, and who is hoping to be reappointed.” Powell almost certainly did not want to be seen voting against a key plank of the President’s agenda at a moment when he, and the Fed comms shop and congressional liaisons, have been frantically pushing his reappointment. Rather than telling him to get on board or get lost, as she should have done, Yellen appears instead to have sacrificed actual climate policy at the altar of Powell’s reappointment campaign. And she’s not letting up anytime soon; this weekend she doubled down, going on the Sunday shows to lie about Powell’s record on financial regulation.
We’ve been clear that Powell’s reappointment would undermine climate action at the Federal Reserve. That was alarming enough, but it’s now clear that it will undermine action at other agencies too. As Joe Biden prepares to head to Glasgow, empty-handed thanks in part to Trump’s Fed Chair, we’d like to know: is he going to do something about it?
Congressional Oversight:
Earlier this month in Talking Points Memo, Jeff Hauser and I urged Congress to immediately subpoena Mark Zuckerberg for his testimony following damning reporting from the Wall Street Journal and further revelations from Facebook whistleblower Frances Haugen’s testimony. Since then, several developments have further underscored the need for swift and decisive congressional action. In the last several days, “the Facebook Papers,” a series of reports from a consortium of 17 news organizations, have revealed even more about the extent of Facebook’s unwillingness and inability to implement or enforce even basic safeguards. And, last week, we were treated to yet another example of Facebook’s contempt for democratic accountability when it launched its digital wallet, Novi, in direct defiance of a call from Senators to halt digital currency initiatives in light of these recent scandals. Lawmakers should waste no time issuing a subpoena for Mark Zuckerberg’s testimony and any additional documents from Facebook to assist its investigation into threats from Facebook’s aggressively expansionary initiative.
Independent Agencies:
After months of delay, the White House finally announced two nominees for the Federal Communications Commission (FCC) yesterday -- enough to secure a Democratic majority. Both are excellent picks who will fight for the public interest against the power of Big Telecom. Unfortunately, these nominations may already be coming too late to stop the FCC from falling into Republican hands for a period of time next year. Acting Chair Jessica Rosenworcel’s term expires at the beginning of January, just 67 days from now. As of July, a nominee’s average time to confirmation was just over 60 days but it’s likely to be even slower going into the end of the year as Republican Senators ramp up their obstruction and a busy legislative calendar monopolizes finite Senate floor time. Situations like these make it all the more clear that Senate confirmation rules need to change. Jeff Hauser and I went into more detail on the how and why for The Hill last week, check it out.
Want more? Check out some of the pieces that we have published or contributed research or thoughts to in the last week:
The Senate confirmation process is broken — Senate Democrats can fix it
Congress Should Subpoena Facebook Officials
Biden zeroes in on Califf to head FDA as deadline nears
Drain the swamp? This guy's trying to fill it.
Joe Biden is in no position to lecture the world on climate change
Former Facebook executive leaving White House staff secretary post
POLITICO Playbook PM: The early winners and losers of the emerging BBB framework
The misleading campaign against a Biden-nominated bank regulator
If You Want To Hate On Merrick Garland’s DOJ, There Are So Many Better Reasons
Joe Biden is in no position to lecture the world on climate change
Biden burying businesses under red tape; more rules on the way
Who Is Jeffrey Clark, and How Did He Try to Destroy Democracy?
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