NYT says it was unfair on Haley curtain story | TheHill
Sun, 16 Sep 2018 13:04
The New York Times added an editors' note to a Thursday story saying a photo of U.S. Ambassador to the United Nations Nikki Haley Nimrata (Nikki) HaleyNYT says it was unfair on Haley curtain story The Hill's 12:30 Report '-- Manafort pleads guilty | Deal involves 'cooperation agreement' | Florence makes landfall Rubio defends Haley over curtains story: Example of media pushing bias MORE should not have been included with a story about how the State Department had spend $52,701 for curtains at her official residence in New York.
The Times had received considerable blowback for the piece, headlined "Nikki Haley's View of New York is Priceless. Her Curtains? $52,701."
The headline on the story was changed Friday to read "State Department Spent $52,701 on Curtains for Nikki Haley's Residence," but the preview headline on the paper's official Twitter feed remains unchanged.
The editors' note attached to the story said the article and headline "created an unfair impression" about those responsible for "the purchase in question."
"An earlier version of this article and headline created an unfair impression about who was responsible for the purchase in question," reads the statement. "While Nikki R. Haley is the current ambassador to the United Nations, the decision on leasing the ambassador's residence and purchasing the curtains was made during the Obama administration, according to current and former officials."
"The article should not have focused on Ms. Haley, nor should a picture of her have been used," it concludes. "The article and headline have now been edited to reflect those concerns, and the picture has been removed."
The changes comes after the Times was ripped on social media for being misleading in its headline after Haley's spokesman told the paper the purchase of the curtains occurred during the Obama administration and that the fixtures were installed last year under former Secretary of State Rex Tillerson Rex Wayne TillersonNYT says it was unfair on Haley curtain story Rubio defends Haley over curtains story: Example of media pushing bias ''Fear and loathing in the' s'wamp': Woodward channels Washington groupthink MORE 's tenure that ended earlier this year.
1/ A word on the false meme bopping around about @nikkihaley's $52,701 curtains. NYT story notes in 6th paragraph, ''A spokesman for Ms. Haley said plans to buy the curtains were made in 2016, during the Obama administration. Ms. Haley had no say in the purchase, he said.''
'-- Jake Tapper (@jaketapper) September 14, 20182/ Elaborating, a source at the US Mission to the UN tells CNN: ''It was decided, well before the election in 2016, that the US Ambassador's residence would move from the Waldorf to its new location. The new location was unfurnished/unfinished....
'-- Jake Tapper (@jaketapper) September 14, 20183/ The source continues: ''In June of 2016 it was decided that the State Department's Bureau of Overseas Buildings Operations would outfit the new residence (this is standard operating procedure for Ambassadors' residences across the globe.)...
'-- Jake Tapper (@jaketapper) September 14, 2018Misleading headline. Few are reading past the first couple grafs. And now most of Twitter thinks @nikkihaley is like Pruitt or Price when she's not. How irresponsible. Read the whole story. Also the rent is less expensive than previous admins https://t.co/XpeZzi2wg9
'-- Yashar Ali (@yashar) September 14, 2018Yet again I say: if you are one of my friends on the left promoting this garbage, I don't ever, ever, ever want to hear you claim you ''care about facts''. The NYT piece says curtains were ordered while Obama was still President. This is a partisan hit job. https://t.co/zWXKsSrS5o
'-- Kristen Soltis Anderson (@KSoltisAnderson) September 14, 2018NYT changes its '...@nikkihaley'(C) story in a pretty significant way. Her predecessor actually authorized the $52,000 curtains in her UN residence. https://t.co/iPNAH4PB5o
'-- Josh Dawsey (@jdawsey1) September 14, 2018Sen. Marco Rubio Marco Antonio RubioNYT says it was unfair on Haley curtain story Rubio defends Haley over curtains story: Example of media pushing bias House lawmakers urge top intel official to probe national security threat of doctored videos MORE (R-Fla.) also took to Twitter to slam the Times for the "subtle" manner the "media pushes their bias."
"Want an example of subtle ways media pushes their bias?" Rubio said in a tweet. "See this completely false & misleading headline about '...@nikkihaley. They are not ''her curtains'' & buried deep in story is the fact that this purchase was made under Obama administration."
Investigation ordered after number of 'transitioning referrals' increase by four per cent | Daily Mail Online
Sun, 16 Sep 2018 09:53
An urgent investigation has been launched into why soaring numbers of girls aged as young as four want to change gender '' and whether social media is to blame.
Equalities Minister Penny Mordaunt has ordered officials to discover the reasons why the number of girls being referred for 'transitioning' treatment has increased by 4,415 per cent.
Psychologists and behavioural experts will explore why '' in the words of one source '' some girls think that modern life is 'easier to bear' if they become boys.
Official figures show the number of children referred for gender treatment '' including hormone injections '' has risen from 97 in 2009/10 to 2,519 in 2017/18. But by far the steepest rise has come among girls: up from 40 to 1,806.
An urgent investigation has been launched into why soaring numbers of girls aged as young as four want to change gender like, Alex Bertie who showed his transition on YouTube
Trans boy with 300,000 Youtube followers Alex Bertie built up a following of 300,000 on YouTube during his transitioning from female to male '' adding to fears that social media may be influencing young people who want to change sex.
Growing up in Dorset, Alex appeared to be a typical tomboy: sporting long blonde hair, but playing with toy cars and video games. As a 13-year-old girl she fell in love with another girl, leading to bullying. Yet it was only at 15 that Alex '' now 22 '' determined to change sex after being sent to an LGBT group called Over the Rainbow. There, the youngster was given information about how to transition on the NHS.
He subsequently had sex change hormone therapy with testosterone and an operation to reduce both breasts.
In videos he tells his fans that the results of the treatment have been 'pretty amazing'.
A total of 45 of the children were aged six or under, with the youngest ones being just four.
Last night, a source in the Government Equalities Office, which handles policies on 'women, sexual orientation and transgender equality', said: 'There has been a substantial increase in the number of individuals assigned female at birth being referred to the NHS. There is evidence that this trend is happening in other countries as well.
Little is known, however, about why this is and what are the long-term impacts.'
Psychologists and behavioural experts will explore why '' in the words of one source '' some girls think that modern life is 'easier to bear' if they become boys (stock)
Another source said: 'Is it, to put it crudely, that young girls simply think modern life would be easier to bear if they were boys?' Some therapists believe the rise is linked to the same mental health crisis among girls which has led to an epidemic of self-harm, with social media perpetuating hyper-sexualised ideals of what it means to be a woman.
The Mail on Sunday disclosed last month that almost two thirds of children and teenagers who say they want to change sex have been diagnosed with serious mental health disorders before expressing the desire to transition.
A total of 63 per cent have had 'one or more diagnoses of a psychiatric disorder or neurodevelopmental disability' before announcing they wanted to change gender. Almost half had self-harmed and 50 per cent had suffered a traumatic event in their lives, such as being bullied or suffering sexual abuse.
The MoS has revealed the fears of a leading doctor that the health of hundreds of children is being put at risk by sex-change drugs doled out on the NHS.
Official figures show the number of children referred for gender treatment '' including hormone injections '' has risen from 97 in 2009/10 to 2,519 in 2017/18 (stock)
Dr Lucy Griffin, a consultant psychiatrist at Bristol Royal Infirmary, said she was 'extremely worried' about the long-term effects the medication was having on adolescents.
She warned that medicines being given to teens to help them change gender can render them infertile, cause osteoporosis and result in sexual dysfunction.
The medicines include 'puberty blocker' drugs, which halt the onset of adulthood, and 'cross sex hormones' which start the physical process of changing sex.
Last year 800 children in England who were unhappy being the sex they were born were given puberty blocking injections, including some as young as ten.
The debate comes against the backdrop a row between feminists and transgender activists over whether transgender women '' who were born male '' should be placed in the same category as biological females.
Treat Canadian Soldiers Better - The Rebel
Sun, 16 Sep 2018 06:46
The "non-partisan" ministerial bureaucrats working for Justin Trudeau's Liberals are actively hiding from Canadians the details surrounding the cost of the "refugee" settlement program.
In a memo obtained by The Rebel through the Freedom of Information Act, bureaucrats discussed how to handle a media inquiry about the yearly cash support that Canada provides Trudeau's Syrians.
'' Thanks Nancy, we have a table approved in past responses with breakdowns. Can we try to dig that up and include it here? I think the reporter is looking for numbers. We know that 50k is the new start-up cost but we haven't used that yet. If we do can we get MINO approval? Earlier this week we opted to go with the individual cost response for the Canadian Federation of Taxpayers , but in this instance the reporter is talking about families so it may be okay to use''
The bureaucrats worried about their communication strategy because they know Canadian taxpayers would be outraged by the amount of money being spent in benefits given towards Syrian migrants who are entering Canada. And now we know, that the yearly amount in cash benefits given to migrants is indeed $50,000 per family.
The bureaucrats tried to hide the numbers from the Canadian Taxpayers Federation by using data for individual refugees rather than for families. Shady stuff, considering that Immigration, Refugees and Citizenship Canada changed the definition of "family" to include young able-bodied men travelling together who self-identified as brothers.
The bureaucrats go on to say in the email chain that detailed info about yearly costs was only going to be given if they were pressed on it. Their default was to hide the truth from Canadians.
The bureaucrats then share a table of a breakdown of financial support for Syrian migrants as an approved talking point for media inquiries.
The numbers in the table are based on cities and family sizes. For example, a refugee family of four resettling in Vancouver receives $5,455 in startup support and another $1,508/month. A single Syrian migrant settling in Halifax would receive $2,068 in initial startup support and another $616 every single month.
But the table conveniently doesn't give the yearly totals, nor the numbers for families larger than four; which is weird, since most Syrian families coming to Canada were much larger than just two kids and a mom and a dad. In fact, according to this graph , there were more families that were made up of eight people, than there were families of four.
The bureaucrats actually cross out a sentence in their talking points, one that reveals the government, or rather Canadians provided up to a maximum of $50,000 per year in cash aid per migrant family.
And to be clear, that's just the cash aid. That's not healthcare, dental and other benefits.
But the officials didn't cross out a number because it was inaccurate. The number was accurate, but it would be troublesome politically.
'' let's not mention the 50k as you say, but let's add these details only. FYI Kathy informs me she will have the 2016 numbers very soon maybe as early as next week.''
Don't mention it. Protect Trudeau even if it means misleading those who are footing the bill. This is our allegedly non-partisan civil service, blurring the numbers for the Liberals. It's gross.
But when dealing with veterans and the military Trudeau's Liberals are suddenly fiscal tightwads, making them share sleeping bags and backpacks and refusing to procure the jets they need because the money just isn't there to spend, or rather the Liberals just don't want to spend it on our heroes.
But the government chequebook swings wide open to support migrants who admitted to government workers that they were better off in Jordan, people who weren't in immediate danger, and weren't really refugees at all.
I want to do something about this, but I need your help.
Please sign my petition to the minister of defence, Harjit Sajjan, and to the immigration minister, Ahmed Hussen. I want them to know that thousands of Canadians are sick and tired of our veterans and Canadian forces being neglected.
Treat our soldiers better. Quit fighting them in court, treat them like the heroes they are, quit treating them like their greedy nags who are asking too much, and take care of them as well as they would take care of a foreigner who illegally crossed the border from upstate New York.
Sign the petition!To: Minister of Defense, Harjit Sajjan and Immigration Minister, Ahmed Hussen
Canada should treat our Canadian military veterans better than foreign refugees.
Hillary Clinton on pantsuits, Birkenstocks, and bitcoin '-- Quartz
Sun, 16 Sep 2018 06:03
Hillary Clinton loves pantsuits. She loves swimming. She doesn't love Russian bots, or creepy dudes during debates. That, we knew.
Her other likes and dislikes? Well, we learned a few new ones today at the Lesbians Who Tech Summit in New York City. Clinton was a surprise keynote speaker, and when she entered, the crowd'--hundreds of LGBTQ women and their allies within the tech industry'--erupted.
After sharing her perspective on Russia's meddling in the 2016 US election, the importance of the 2018 primaries, and the absurdity of Pizzagate (''There wasn't even a basement in the pizzeria,'' said Clinton), the former US first lady, secretary of State, and presidential candidate a series of rapid-fire questions from Leanne Pittsford, founder and CEO of Lesbians Who Tech + Allies, a community for queer women in and around tech, and their supporters.
Somewhat caught off guard at first, Clinton quickly leaned into the questions, sharing some of her favorite things. Pittsford's questions are in bold, followed by Clinton's responses:
''Team dog or team cat?''''Dog.''
''Do you own bitcoin?''''No.''
''Is Facebook a utility?''''As I remember from Kara [Swisher's]last long interview, originally Mark [Zuckerberg] thought it was. And I don't know the best way to work with tech companies to figure out how to deal with all of these second- and third-order effects [of Facebook] on our democracy, on our social lives, and on our brains, but we need to, whether it's a utility or not.''
''Pantsuit or tracksuit?''''Pantsuit, duh.''
''Crocs or Birkenstocks?''''Birkenstocks.''
''Favorite character on TV?''''Right now I'm gonna have to go with Madame Secretary.''
''Most used app on your phone?''''Oh, all the news sites. I know, I can't help myself.''
''What's the next show or film on your Netflix queue coming up?''''Coming up, I don't know, I'm so far behind. I'm so far behind. I haven't even seen the second year of Handmaid's Tale, or The Crown, to show my viewing range.''
''What is your biggest tech challenge? And by that I mean, I'm the same around the same generation as Chelsea, and my dad calls me a lot'--probably every couple weeks'--with problems on his computer, his phone. He saves a list for when he sees me. What are you calling Chelsea for, on tech problems?''''Yeah, you know my daughter, my son-in-law, my staff are extremely patient with me. You know, look, I was not an early adapter,'' said Clinton (adapter, adopter, don't matter when you're Hill).
''And I've come a long way. I like to think I've become more of a tech appreciator, and so, yeah, they have to help me all the time because I'm always asking questions. Like just this week'--I'm a little paranoid to be honest now'--so when they call, I can sort of hear their eyes rolling when I'm like, 'Ah, some of my messages are disappearing, what's going on?'''
''What's that one thing that, if it happened, you would know your work is done? For me, it's having a black lesbian president. For you, what is your moonshot?''''Wow, well can I have two moonshots?''
''You can have whatever you want.''
''Obviously one of them is having a woman president, which I think would make such a difference. And the other is once and for all getting to universal healthcare coverage that covers everything. So you know, I'm going to keep trying to make the first one happen, and keep working to make the second happen eventually.''
Urban Dictionary: lewk
Sun, 16 Sep 2018 05:53
Any outfit you put a special amount of attention into
constructing, potentially for an event or
special occasion, usually with some sort of theme or reference you're attempting to
Facebook is hiring a human rights policy director
Sun, 16 Sep 2018 05:47
The future director would be particularly well-experienced. They'd need at least 12 years of experience with public policy and human rights (including in developing countries), and would require some background in technology.
Facebook's recruiting effort isn't surprising. Six organizations blasted the social site for taking over a year to respond to misinformation that helped fuel the genocide of Rohingya in Myanmar -- the company doesn't want to be put in that position again. It's simultaneously an acknowledgment that Facebook's efforts to curb fake news and propaganda won't just affect election results. In some cases, they could save lives and protect basic human dignity.
We're hiring a Director of Human Rights Policy to drive investigations into abusers on our platforms, coordinate the company-wide effort on conflict prevention & peace-building, and advise product teams on making Facebook a positive force for human rights. https://t.co/vgetonFEzz
'-- Sara Su (@sarasous) September 14, 2018
Active Measures (2018) - IMDb
Sun, 16 Sep 2018 05:31
Edit Storyline Russian president Vladimir Putin attacks the 2016 American Presidential Election in collaboration with The Trump Campaign.
Plot Summary | Add Synopsis Taglines:The 2016 U.S. presidential election wasn't the beginning. If we don't act now, it won't be the end.
Motion Picture Rating (MPAA) Rated PG-13 for thematic content including violence, war images and some crude sexual references Edit Details Release Date: 31 August 2018 (USA)
See more >> Also Known As: Active Measures
See more >> Edit Box OfficeGross USA: $11,953, 3 September 2018
See more on IMDbPro >> Company Credits Technical Specs Runtime: 109 min (original)
full technical specs >>
Behind the Anglo American War on Russia | New Eastern Outlook
Sat, 15 Sep 2018 22:05
Perhaps they had a chance back during the Obama days when Secretary of State Hillary Clinton proposed her amusing ''Reset'' in USA-Russia relations to the new Medvedew Presidency following Putin's rotation to the seat of Prime Minister in March 2009. Had Washington been a bit more perceptive and offered serious alternatives, it is conceivable that Washington would today have a geopolitical isolation of their second major problem on the Eurasian Continent, namely, the Peoples' Republic of China. Recently the US Assistant Secretary of State for Europe and Eurasia, Wess Mitchell, testified to the Senate where he candidly revealed the true reasons for current Washington and London campaigns and sanctions against Russia. It has nothing to do with faked allegations of US election interference; it has nothing to do with poorly-staged false flag poisoning of the Russian Skripals. It's far more fundamental and takes us back to the era before the First World War more than a century ago.
In testimony before the Senate Foreign Relations Committee on 21 August, Wess Mitchell, the successor to Victoria Nuland, gave an extraordinarily honest statement of real US geopolitical strategy towards Russia. It revealed a bit more honesty apparently than the US State Department wanted, because they quickly sanitized their published version on the department website.
In his opening remarks to the Senate committee members Mitchell stated:
''The starting point of the National Security Strategy is the recognition that America has entered a period of big-power competition, and that past US policies have neither sufficiently grasped the scope of this emerging trend nor adequately equipped our nation to succeed in it.
Then he continues with the following extraordinary admission:
''Contrary to the hopeful assumptions of previous administrations, Russia and China are serious competitors that are building up the material and ideological wherewithal to contest US primacy and leadership in the 21st Century. It continues to be among the foremost national security interests of the United States to prevent the domination of the Eurasian landmass by hostile powers. The central aim of the administration's foreign policy is to prepare our nation to confront this challenge by systematically strengthening the military, economic and political fundaments of American power.''
In the State Department's later sanitized version, the original text, ''It continues to be among the foremost national security interests of the United States to prevent the domination of the Eurasian landmass by hostile powers.'' And the sentence, ''The central aim of the administration's foreign policy is to prepare our nation to confront this challenge by systematically strengthening the military, economic and political fundaments of American power,'' mysteriously were deleted. Because it was formal testimony presented to the Senate, however, the Senate version remains true to his original text, at least of 7 September, 2018. The State Department has been caught in a huge blunder.
If we pause to reflect on the meaning behind the words of Wess Mitchell, it's pretty crude and wholly illegal in terms of the UN Charter, though Washington today seems to have forgotten that solemn document. Mitchell says US national security priority is to, '''...prevent the domination of the Eurasian landmass by hostile powers.'' He clearly means powers hostile to efforts of Washington and NATO to dominate Eurasia, ever since the collapse of the Soviet Union more than a quarter century ago.
But, wait. Mitchell earlier cites the two dominant powers who combined, he says, are the current prime foe of US global control. Mitchell states explicitly, ''Russia and China are serious competitors that are building up the material and ideological wherewithal to contest US primacy and leadership.'' But US control of Eurasia then means US control of Russia, China and environs. Eurasia is their land space. The Wess Mitchell Senate declaration is a kind of obscene global rollout of the 19th Century USA Monroe Doctrine: Eurasia is ours and ''hostile powers'' such as China or Russia who try to interfere in their own sovereign space, become de facto ''enemy.'' Then the formulation ''building up the material and ideological wherewithal'...'' What's that supposed to mean as justification for Washington policy to prepare a military response? Both nations are energetically moving, despite repeated Western economic warfare, to build their economic infrastructure independent of NATO control. That is understandable. But Mitchell admits it is for Washington Casus Belli.
To realize what a strategic blunder the Assistant Secretary of State for Europe and Eurasian Affairs made with that one careless sentence and why the State Department rushed to delete his remarks, a brief excursion into basic Anglo-American geopolitical doctrine is useful. Here, discussion of the worldview of the godfather of geopolitics, British geographer Sir Halford Mackinder is essential. In 1904 in a speech before the Royal Geographical Society in London, Mackinder, a firm advocate of Empire, presented what is arguably one of the most influential documents in world foreign policy of the past two hundred years since the Battle of Waterloo. His short speech was titled ''The Geographical Pivot of History.''
Russia and Eurasian Pivot
Mackinder divided the world into two primary geographical powers: Sea power versus Land power. On the dominant side was what he termed the ''ring of bases'' linking sea powers Britain, USA, Canada, South Africa, Australia and Japan in domination of the world seas and of commerce power. This ring of dominant sea-powers was inaccessible to any threat from land powers of Eurasia or Euro-Asia as he termed the vast continent. Mackinder further noted that were the Russian Empire able to expand over the lands of Euro-Asia and gain access to the vast resources there to build a naval fleet, ''the empire of the world might then be in sight.'' Mackinder added, ''This might happen if Germany were to ally herself with Russia.''
Mackinder noted the enormous geopolitical implications of the then-new Russian Trans-Siberian Railway linking the vast territory of Russia from in Moscow at Yaroslavsky Vokzal, across all Russia some 6,000 miles to Vladivostock on the Pacific. He warned his select British audience, ''the century will not be old before all Asia is covered with railways,'' creating a vast land area inaccessible to the naval fleets of the British and later, Americans.
What the world has experienced since that prophetic 1904 London speech of Mackinder is two world wars, primarily aimed at breaking the German nation and its geopolitical threat to Anglo-American global domination, and to destroy the prospect of a peaceful emergence of a German-Russian Eurasia that, as Mackinder and British geopolitical strategists saw it, would put the ''empire of the world'' in sight.
Those two world wars in effect sabotaged the ''covering of all Eurasia with railways.'' Until, that is, in 2013 when China first proposed covering all Eurasia with a network of high-speed railways and infrastructure including energy pipelines and deep-water ports and Russia agreed to join the effort.
The Washington-orchestrated coup d'etat in Ukraine in February, 2014 was explicitly aimed at driving a bloody and deep wedge between Russia and Germany. At the time, Ukraine was the prime energy pipeline link feeding the German industry with Russian gas. German exports of everything from machine tools to cars to high-speed locomotives to build the rapidly-recovering Russian economy was transforming the geopolitical balance of power in favor of an emerging German-Russian-centered Eurasia to the detriment of Washington.
In an interview in January, 2015 following what he called ''the most blatant coup in history'', the USA coup in Ukraine, Stratfor founder George Friedman, a student of Mackinder, stated, '''...the most dangerous potential alliance, from the perspective of the United States, was considered to be an alliance between Russia and Germany. This would be an alliance of German technology and capital with Russian natural and human resources.''
At this point Washington is becoming more than a little desperate to bring the genie back in the bottle that their clumsy 2014 Coup d'etat in Ukraine caused to get out. That coup forced Russia to take more seriously its potential strategic alliances in Eurasia and catalyzed present Russia-China cooperation as well as the Russian engagement with key Eurasian neighbor states in the Shanghai Cooperation Organization.
Wess Mitchell's predecessor, Victoria Nuland, with her cocky hubris in Ukraine, when she was caught telling her Kiev Ambassador, ''F**k the EU,'' was noted across Eurasia. She gave the Washington game away. It's not about principled diplomatic partnership. It's about power and empire.
Now Wess Mitchell's admission that the US strategic policy is to ''prevent domination of Eurasia by hostile powers'' tells Russia and tells China, had they had any doubts, that the war is about a fundamental geopolitical contest to the end over who will dominate Eurasia'--it's legitimate inhabitants, centered around China and Russia, or an imperial Anglo-American axis that has been behind two world wars in the past century. Because Washington mismanaged the Russian ''Reset'' that was meant to draw Russia into the NATO web, Washington today is forced to wage a war on two fronts'--China and Russia'--war it is not prepared to win.
F. William Engdahl is strategic risk consultant and lecturer, he holds a degree in politics from Princeton University and is a best-selling author on oil and geopolitics, exclusively for the online magazine ''New Eastern Outlook.''
''Leaking Like Mad'': FBI-DOJ-MSM Collusion Went Far Deeper Than Previously Known
Sat, 15 Sep 2018 21:53
The FBI's coordination with the mainstream media surrounding the 2016 US election '' a ''media leak strategy'' which was first first revealed Tuesday, goes far deeper than first reported, according to Fox News, which obtained ''new communications between the former lovers.''
A December 15, 2016 email appears to discuss a ''political'' leaking operation, in which others were ''leaking like mad'' amid the Trump-Russia probe.
''Oh, remind me to tell you tomorrow about the times doing a story about the rnc hacks,'' Page texted Strzok.
''And more than they already did? I told you Quinn told me they pulling out all the stops on some story'...'' Strzok replied.
A source told Fox News ''Quinn'' could be referring to Richard Quinn, who served as the chief of the Media and Investigative Publicity Section in the Office of Public Affairs. Quinn could not be reached for comment.
Strzok again replied: ''Think our sisters have begun leaking like mad. Scorned and worried, and political, they're kicking into overdrive.''
In one passage, Strzok apparently misreads a reference to ''rnc'' as ''mc,'' and then, realizing his error, blames ''old man eyes.''
It is unclear at this point to whom Strzok was referring when he used the term ''sisters.'' ''Fox News
''Sisters'' may refer to sister agency.
''Sisters is an odd phrase to use,'' retired FBI special agent and former FBI national spokesman John Iannarelli told Fox News Wednesday. ''It could be any intelligence agency or any other federal law enforcement agency. The FBI works with all of them because, post 9/11, it's all about cooperation and sharing.''
The US intelligence community is comprised of 17 agencies, including the CIA, the Office of the Director of National Intelligence, the FBI and the National Security Agency.
Fox News notes that the ''leaking like mad'' reference was texted the same day that several US news outlets reported that Russian President Vladimir Putin was personally involved '' and personally approved, Russian meddling in the 2016 presidential election.
Several days before that, an article titled ''Russian Hackers Acted to Aid Trump in Election, U.S. Says,'' was published in the New York Times, which cited ''senior administration officials.''
Then, on January 10, 2017, The Times published another article which suggested that Russian hackers had ''gained limited access'' to the Republican National Committee (RNC) '' the same day that BuzzFeed News published the ''Steele Dossier'' accusing President Trump of a variety of salacious and unproven ties to Russia.
Following the text about ''sisters leaking,'' Strzok wrote to Page:
''And we need to talk more about putting C reporting in our submission. They're going to declassify all of it'...''
Page replied: ''I know. But they're going to declassify their stuff, how do we withhold'...''
''We will get extraordinary questions. What we did what we're doing. Just want to ensure everyone is good with it and has thought thru all implications,'' Strzok wrote. ''CD should bring it up with the DD.''
A source told Fox News that ''C'' is likely in reference to classified information, whereas ''CD'' is Cyber Division, and DD could refer to former FBI Deputy Director Andrew McCabe.
McCabe was fired by Attorney General Jeff Sessions in March for making an unauthorized disclosure to the news media, and ''lacked candor'' under oath on multiple occassions.
It is unclear what ''submission'' Strzok and Page were referring to. ''Fox News
A source also told Fox News that the messages were part of the newly released batch of Strzok-Page communications obtained by DOJ Inspector General Michael Horowitz, who uncovered them as part of his investigation into the FBI's conduct in the Russia investigation.
FEMA to test 'Presidential Alert' system next week
Sat, 15 Sep 2018 20:08
Breaking News EmailsGet breaking news alerts and special reports. The news and stories that matter, delivered weekday mornings.
President Donald Trump may soon be communicating with you directly on your phone '-- even if you don't follow him on Twitter.
Next Thursday, the Federal Emergency Management Agency will do its first test of a system that allows the president to send a message to most U.S. cellphones.
More than 100 mobile carriers, including all the major wireless firms, are participating in the roll out, FEMA stated in a message on its website posted Thursday.
"The EAS [Emergency Alert System] is a national public warning system that provides the President with the communications capability to address the nation during a national emergency," FEMA said.
The test message will have a header that reads "Presidential Alert," according to the agency.
Users whose phones are on will twice hear a tone and vibration and then see an English-only (for now) message: "THIS IS A TEST of the National Wireless Emergency Alert System. No action is needed.''
The wireless emergency alerts (WEA) system was authorized by Congress in 2015 under a law that states the "system shall not be used to transmit a message that does not relate to a natural disaster, act of terrorism, or other man-made disaster or threat to public safety."
Experts didn't appear to be too concerned that Trump, known to use his smartphone to blast opponents, berate subordinates and take shots at the news media on Twitter, could abuse WEA.
"If you separate this from the politics and personality of any individual president then this is a great idea and an amazing use of technology to reach everybody if they're in harms way," said Karen North, director of the Annenberg Digital Social Media program at the University of Southern California.
UCLA communications professor Tim Groeling agreed, writing via email, "broadcast-based emergency alert systems ... have remained professional and impartial over decades."
The WEA is a new way to reach an America increasingly attracted to fragmented forms of media found on phones, tablets and laptops. The well-worn emergency alert system reaches mainly radio and television broadcasters, cable systems, satellite radio and television providers.
"A system like this seems necessary in an era where most people are disconnected from 'live' media like radio and television," Groeling said.
FEMA stated that the government cannot track end users' location through this alert system.
The test is supposed to take place at 2:18 p.m. EDT on Sept. 20. Under the Warning, Alert, and Response Network (WARN) Act of 2006, cellphone users cannot opt out of the presidential alerts.
California's Proposition 47: Crime and No Consequences | National Review
Sat, 15 Sep 2018 17:49
(Photo: Jinga80/Dreamstime) The 2014 ballot initiative had unintended results galore. C alifornia's Proposition 47 downgraded a variety of ''non-serious, nonviolent crimes'' that had previously been considered felonies to misdemeanors. These include shoplifting, grand theft, receiving stolen property, forgery, fraud, and writing bad checks. As long as the total value of the stolen property is under $950, only a ghost of an offense has occurred. A thief may now steal something under that limit on a daily basis and it will never rise to felony status.
In the event that a perpetrator is pursued and apprehended, the consequence can be a small fine or a brief stay in jail, In reality, these repercussions are rare. In addition, DNA samples aren't collected from misdemeanor offenders. Thus the DNA database has shrunk, making it more difficult for law-enforcement agencies to solve cold cases, including those involving rape and murder.
The underlying premise of Proposition 47 was to free up funds so the state could focus on violent and serious offenders. Savings would be diverted to school-based prevention and support programs, victim services, and mental-health and drug treatment. Therefore petty thieves, who might be drug addicts, would avoid costly and ultimately detrimental incarceration. The referendum had the support of California Democratic party and the American Civil Liberties Union, and the state's voters passed it into law in 2014.
What could possibly go wrong?
That question is best asked of the people in California who are robbed and call the police for help. Overall, they're blindsided by the slow (or non-) response. The surprise and anger they feel is tremendous. Nearly a thousand dollars in stolen property is hardly minor, especially to those who have little to lose. It's not just the loss of personal possessions they'll probably never see again that is so distressing, but the ruined trust in the system that they assumed was designed to protect the innocent.
For law enforcement, however, there is little incentive to chase down low-level criminals. Even if the person is escorted to the station, odds are great he'll be back on the street in an hour or so.
Outrage in these circumstances is apolitical. A liberal Berkeley student studying in a caf(C) whose laptop is swiped from a table feels just as violated as the right-leaning visitor to Los Angeles whose luggage is stolen. A struggling small-business owner wonders how long he can withstand the damage done by constant pilfering.
''Every bicycle in our building has been stolen,'' says Karen Burns, president of a San Francisco condo association. ''I've caught so many people stealing packages. They don't care. They know nothing will happen to them. It's crazy. It's horrible. I feel like these people need to go to jail.''
Proposition 47 didn't stop with theft. The personal use of illegal drugs was also reclassified to a misdemeanor. Although the intent may have been kind (it's cruel to punish people for having an addiction) and practical (they'll emerge from prison hardened, and a felony on their record makes it more difficult to reintegrate into society), the downstream impact on the community at large has been disastrous. In San Fransisco, for example, shooting up in public is commonplace, whether it's on the steps of City Hall, in front of a supermarket, or at the entrance to a children's playground.
Residents who are experiencing an uptick in so-called low-level crimes in their neighborhoods are baffled by studies indicating otherwise. For example, a December 2017 Center on Criminal and Juvenile Justice report shows property crimes down by an average of 18.1 percent across the state. Those numbers are false, says Michael Rushford, president of the Sacramento-based Criminal Justice Legal Foundation, a nonprofit public-interest law organization: ''More, not fewer, of these crimes are being committed, but people aren't reporting them. In most cases they have to do it online, and they end up not doing it. They don't believe anything will happen, so don't see the point. And they're right.''
In fact, Magnus Lofstrom, a researcher at the Public Policy Institute of California, pointed to a 12 percent jump in larceny-theft (essentially, unlawfully taking someone's property) in the state immediately after Proposition 47 took effect. ''Crime rates always fluctuate, and the data isn't always accurate,'' says Lofstrom.
Certainly San Franciscans aren't debating whether or not crime is up. They know it is. In January, Police Chief William Scott acknowledged a 24 percent jump in property crimes from 2016 to 2017. Auto break-ins have soared in every district, and the arrest rate for them is an astonishing 1.6 percent. Citizens are right to feel disgusted and demoralized. In areas such as the Tenderloin, which is home for many of the city's low-income immigrants, impoverished senior citizens, and families with young children, quality of life has deteriorated. Now more than ever, residents and merchants are living with a proliferation of addicts who roll up their sleeves, inject, and then nod off on the sidewalks or career down the street and into traffic. To fulfill customer demand, dealers sell packets of powder or pills in plain view of passers-by. There is no reason to hide. Why not shoot up wherever you want, leave bloody syringes in piles, steal, and deal when there are few if any consequences?
But there are repercussions, and they've felt by every person '-- young and old, rich and poor '-- who is robbed and lives among the growing cadre of drug users and dealers and what it's all done to their neighborhoods.
As in cities across the state, police departments hold community meetings to discuss crime and safety issues. Citizens arrive, frustrated and ready to vent. They won't be placated with positive statistics. During a recent gathering in San Francisco's Russian Hill '-- a beautiful neighborhood that boasts that famous crooked street, Lombard (now infamous for being haunted by rings of gang members who break into cars, steal tourists' belongings, and relieve news crews of equipment) '-- an older gentleman who was born and raised in the city now says he feels like a prisoner in his home, afraid to leave. Officers, who are doing their best, urge residents to call the police and report crimes. Yet people are acutely aware that even if they do, justice won't be served. So they direct their rage toward the police with a ''you're not doing your job!'' No one leaves happy.
Regarding the money saved by Proposition 47 '-- a reported $103 million '-- it is just now being distributed. In June of 2017, the Board of State and Community Corrections granted the funds to 23 applicants ''whose rehabilitative programs were deemed most promising.'' We can rest assured that soon people who really are desperate for substance-abuse assistance will get it, and criminals will be on their way to a new and lawful life. Or not.
There has been a grassroots reaction to weakened laws. People are beginning to assume control.
There has been a grassroots reaction to weakened laws, however. People are beginning to assume control. They're not waiting for an authority figure to make everything alright. They've been hit by thieves too many times, and are tired of seeing their neighborhoods crumble under the weight of open drug use and commerce. Many have stopped believing that city leaders will ever come to their rescue. A type of vigilantism is emerging. Neighbors are posting on social sites such as Nextdoor, and monitoring crime with apps such as Citizen. Residents film perpetrators, then post photos and videos online with messages such as: ''Be on the lookout for this man. He stole packages from my door-stoop last night.'' and ''This woman is selling Fentanyl-dipped cigarettes in front of a preschool. I've told her to leave and she did, but if you see her; do the same.'' They are forming neighborhood watch groups, and, for those who can afford them, employing private security guards. People are mobilizing, getting creative, and leaning on technology, themselves, and each other for real help. Still, crime victims are pained and livid.
Thankfully, some are attempting to fix the unintended consequences of Proposition 47. State assemblyman Jim Cooper (D., Elk Grove) and Sacramento County district attorney Anne Marie Schubert are behind Assembly Bill 16, a ballot initiative that will reverse some of its damage. People convicted of a third theft of property worth $250 could be charged with a felony, and DNA collection would be reinstated for certain misdemeanor convictions.
If proponents can gather the 370,000 signatures necessary to put the measure on the November 2018 ballot, California voters will have the power to pass it into law. It would be the fair thing to do.
The DOJ Is 'Fully on Board' With Prison Reform Proposals
California, Americas Poverty Capital
Expect Criminal-Justice Reform from President Trump's State of the Union
'-- Erica Sandberg is a freelance consumer-finance reporter, political gadfly, and community advocate based in San Francisco, Calif.
Meet the other empty nesters: They're dogs, and they're missing the kids, too. - The Boston Globe
Sat, 15 Sep 2018 17:19
Wyatt stood at the door of his home in West Roxbury keeping an eye out for Gabe Harris, who's off at UMass Amherst.
Craig F. Walker/Globe Staff
In Sudbury, an older Labradoodle named Reuben has been dragging himself up three flights of stairs and plopping himself in front of Kerani Verma's room '-- vacant since she left for the University of Delaware '-- and just waiting.
Gracie, a Newton goldendoodle, has put herself on a hunger strike since sisters Rachel and Emma Brown left for post-grad life and Tufts. She spends her nights snoozing near their empty beds.
As for Wyatt, a yellow Lab in West Roxbury, he's been sitting at the base of the staircase, listening for the command he's been hearing for years '-- ''Go wake Gabe!'''-- only it's not coming anymore. Gabe's left for UMass Amherst.
''He's out of a job,'' said Judy Harris, Gabe's mom and Wyatt's owner. ''And he's mopey.''
As any dog would tell you if she or he could only speak, it's not easy being a canine empty-nester.
With the school year underway and college students departed, households everywhere are dealing with the unnatural quiet, the empty seat at the dinner table, the curious absence of laundry. Parents and siblings know that the kid will return, that the loss is not forever. But what about the pets who wander the house, hunting for the family member who is '-- unaccountably '-- simply gone?
RELATED: Where to have fun with your dog around Boston
As Stephanie Borns-Weil, the head of Tufts Animal Behavior Clinic, put it: ''It's a big deal for dogs when their people leave.''
No one knows that better than Wyatt, whose belly Gabe used as a pillow when he read comic books, recalled Harris. Her son was 7 when Wyatt joined the family, ''and he didn't want to brush his teeth unless the dog was in the bathroom,'' she said.
Wyatt at the stairs of his home in West Roxbury.
Craig F. Walker/Globe Staff
Terri Bright, director of behavior services at MSPCA-Angell, said that not only do dogs ''absolutely'' miss people, but a depressed dog acts like a person who's down.
They don't eat as much. They sleep more. They're not as enthusiastic. ''They seem sad, but they can't tell us,'' she said.
At least not with words.
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Matt Nelson, the voice behind the popular Thoughts of a Dog and WeRateDogsTwitter accounts, said that when he was away at college, his golden retriever, Zoe, sometimes wouldn't want to come in at night '-- she'd wait on the front porch looking down the road for him.
''There was no other reason for her to be out there,'' he said.
Nelson recalled a photo that a Twitter follower sent. It showed her dog Bo peering out a window and had the following caption: ''I've been in college for a whole semester and my dog still waits for me to get off the bus.''
RELATED: How to train your dog to get along with your new baby
What's the owner left at home with a floppy and sad pup to do?
''Help the dog feel joy in other ways,'' said Rachel Locke, the dog whisperer behind Red Rover Ranch, a five-acre boarding and training business in Chelmsford.
Take them for more walks, she advised, work in off-leash time, give them stimulating toys and hugs. ''Distract them.''
Gabe Harris and Wyatt on Cape Cod in July 2017.
Although people sometimes joke about dogs feeling sad, a dog who loses his primary person can grieve for months, said Borns-Weil, of Tufts. She described a scenario in which the kid heading off to college was the one who played with the dog and walked it the most, and she emphasized the importance of maintaining those activities in the dog's life.
''Sometimes when a dog is saying goodbye to a person they're saying goodbye to a whole lifestyle,'' she said.
RELATED: Finding Home: The story of a curious little dog
And here's one more piece of advice: If you're the grieving human empty-nester left at home, cheer yourself up, or at least put up a good front. That's because the dog might not only be missing the departed student but could be picking up on the gloomy mood in the house, said Vivian Zottola, a canine behavior specialist in South Boston. ''Sure, the dog is affected, but they're also responding to mom and dad,'' she said.
Or . . . you can drive the 90 miles from your home to your child's school. That's what Babu Krishnamurthy, a neurologist with Steward Medical Group, did when she realized that the behaviors her elderly German shepherd was exhibiting '-- lack of appetite and enthusiasm '-- were signs he was pining for her oldest son, Suri Chavali, away at UMass Amherst.
''It took me a week to realize,'' she said.
Wyatt visited Gabe Harris's bedroom. Gabe is far away at college.
CRAIG F. WALKER/GLOBE STAFF
The two made the drive from Brookline to Amherst, where Jack and Suri enjoyed a visit. ''I have this glorious picture of him sitting looking at his boy,'' she said. ''
After a few hours, it was time to go. ''All right sweetie, I need to get back,'' she told Jack.
He seemed so happy to be there, and so reluctant to leave, that the doctor made the dog a promise. ''We'll be back in two weeks.''
And they were.
Beth Teitell can be reached at email@example.com Follow her on Twitter @bethteitell
Microsoft intercepting Firefox and Chrome installation on Windows 10 - gHacks Tech News
Sat, 15 Sep 2018 10:31
Martin Brinkmann on September 12, 2018 in
Windows - Last Update: September 12, 2018 -
83 commentsWhen you try to install the Firefox pr Chrome web browser on a recent Windows 10 version 1809 Insider build, you may notice that the installation gets interrupted by the operating system.
The intermediary screen that interrupts the installation states that Edge is installed on the device and that it is safer and faster than the browser that the user was about to install on the device.
Options provided are to open Microsoft Edge or install the other browser anyway. There is also an option to disable the warning type in the future but that leads to the Apps listing of the Settings application and no option to do anything about that.
While there is certainly a chance that Microsoft is just testing things in preview versions of Windows, it is equally possible that such a setting will land in the next feature update for Windows 10.
Companies like Google or Microsoft have used their market position in the past to push their own products. Google pushes Chrome on all of its properties when users use different browsers to connect to them, and Microsoft too displayed notifications on the Windows 10 platform to users who used other browsers that Edge was more secure or power friendly.
The intercepting of installers on Windows is a new low, however. A user who initiates the installation of a browser does so on purpose. The prompt that Microsoft displays claims that Edge is safer and faster, and it puts the Open Microsoft Edge button on focus and not the "install anyway" button.
It seems likely that such a prompt would result in higher than usual exits from installation if the intercepting prompt lands in stable versions of Windows.
There is also a chance that Microsoft would push its own products when users attempt to install other products: think a third-party media player, screenshot tool, image editor, or text editor.
While it seems that Microsoft plans to integrate an option to disable these "warnings", it remains to be seen how that will look like. Judging from the current implementation it will be opt-out which means that the intercepting prompts are displayed to all users by default who attempt third-party software installations.
I tried to install Chrome Stable and Firefox Stable, and both installations were intercepted by the prompt. Again, this happens only in Windows 10 version 1809 on the Insider channel. Whether the intercepting will land in the soon to be released stable version of Windows 10 version 1809, the October 2018 Update, remains to be seen.
Microsoft Edge is not doing so well despite the fact that it is the default web browser on Windows 10. Microsoft stated in 2017 that Edge usage had doubled but third-party usage tracking service still see the browser lag behind Chrome, Firefox and even Internet Explorer in usage share.
Microsoft has released Edge for Android and the browser has been well received by Android users.
Now You: What is your take on the prompt?
Microsoft intercepting Firefox and Chrome installation on Windows 10
When you try to install the Firefox pr Chrome web browser on a recent Windows 10 version 1809 Insider build, you may notice that the installation gets interrupted by the operating system.
Ghacks Technology News
Florence downgraded from hurricane to tropical storm, at least 5 dead in NC
Sat, 15 Sep 2018 09:17
Video by CBS News
RALEIGH, N.C. - Florence was downgraded Friday afternoon from a Category 1 hurricane to a tropical storm, according to the National Hurricane Center.
The storm dropped to sustained winds of 70 mph, which is where they remained at 8 p.m. EDT. A Category 1 hurricane must have winds of at least 74 mph.
At 8 p.m., Florence was moving to the west at 3 mph, according to the NHC, which reported it was in "extreme eastern South Carolina."
Florence is forecast to continue its slow track to the west-southwest through South Carolina into Saturday, the NHC reported. The storm will move generally north across the western Carolinas and the central Appalachian Mountains early next week.
The "erratic" storm made landfall Friday morning near Wrightsville Beach, as North Carolina first responders and the governor reported the first five deaths associated with the storm.
Wilmington police reported that a tree fell on a house, killing a mother and her child. Pender County Emergency Management reported that a woman died of a heart attack when emergency crews couldn't reach her because of fallen trees.
"Two people in Lenoir County were killed: a 78-year-old Kinston man who was electrocuted when connecting extension cords in the rain and a 77-year-old man who was blown down by the wind when he went to check on his hunting dogs," The Raleigh News & Observer reported.
Another death was reported in Brunswick County, N.C.
Slideshow by photo services
A person died at West Brunswick High School Thursday morning while it was being used as a hurricane shelter, Brunswick County spokeswoman Amanda Hutcheson told The News & Observer in an email. Hutcheson did not respond to questions about how the person died. The person had not been identified as of early Friday evening.
"Torrential" rains are expected to continue, the National Hurricane Center said as of its 3 p.m. update, and "catastrophic" freshwater flooding was expected over parts of North and South Carolina.
The storm was expected to dump 20 or more inches of rain in coastal cities, the NHC reported.
"We're still in the thick of the storm, and if it hasn't reached you yet, it IS coming," Gov. Roy Cooper said at 2 p.m., according to North Carolina Emergency Management. "We have help from N.C. and several other states, as well as our federal partners."
At noon Friday, the storm's eye was "wobbling slowly along the coast" where it made a turn west. "An erratic motion between westward and west-southwestward is likely today," said the NHC.
Meanwhile, storm surge, rising rivers and heavy rain have lead to reports of widespread flooding along the coast, including a 10-foot rise in North Carolina's Neuse River, which has endangered at least 150 people stranded in New Bern.
"I see a biblical proportion flood event that's going to occur," Wilmington Police Chief Ralph Evangelous told ABC News. "I see the beach communities being inundated with water and destruction that will be pretty, pretty epic in nature."
Video by Associated Press
Although it has weakened, tropical-storm-force winds extended out up to 175 miles from the center of the storm at 8 p.m., according to the NHC. "A sustained wind of 55 mph and a gust to 68 mph were reported at the National Ocean Service station at Johnny Mercer Pier in Wrightsville Beach."
Florence officially made landfall at 7:15 a.m. near Wrightsville Beach, according to the National Hurricane Center. The first of the rain and wind gusts from Florence rolled ashore just before dawn Thursday at Morehead City, a Carteret County town that is expected to get 20 to 25 inches of rain in the next three days. "Isolated spots could see 30 to 40 inches of rain," says the NHC.
Duke Energy reported that 438,918 customers in North Carolina were without power as of 6 p.m. Another 241,000 N.C. electric cooperative customers were also without power on Friday afternoon, The Charlotte Observer reported.
Most of the power outages were reported in New Hanover County (114,738), but the outages were widespread with significant power losses reported in Wake (47,061), Carteret (24,470) and Johnston (20,570) counties, according to Duke Energy.
In South Carolina, SCE&G reported 498 outages as of 6 p.m., with 348 of them in Richland County, where Columbia sits. The Electric Cooperatives of South Carolina said there were 40,000 power outages across the state, with 29,742 outages in Horry County, where Myrtle Beach is located. Most of the other power losses being reported were in nearby Chesterfield, Clarendon, Georgetown, Marion and Darlington counties.
North Carolina Highway Patrol Col. Glenn McNeill said areas of Interstate 95 "have experienced dangerous travel conditions" and the number of flooded roads is expected to continue to increase.
"Do not attempt to travel through water or go around barricades," McNeill said.
The highway patrol had responded to 80 wrecks and 164 calls for service as of 5 p.m., McNeill said.
At least 33 primary roads and 30 secondary roads "are experiencing flooding and overwash," North Carolina Department of Transportation Secretary Jim Trogdon said.
Roads in New Bern and greater Craven County were hit by rain and flooding from the Neuse River. A gauge where the Trent and Neuse rivers meet in New Bern recorded 10.1 feet of flooding about midnight.
Craven County emergency officials "reported rescuing multiple residents from Hurricane Florence floodwaters through the early morning Friday," even though residents were ordered to evacuate on Tuesday, The Herald-Sun reported.
The City of New Bern said crews were working to get to 150 people awaiting rescue as of early Friday morning.
"WE ARE COMING TO GET YOU," the city said in a tweet. "You may need to move up to the second story, or to your attic, but WE ARE COMING TO GET YOU."
Johnston County asked residents in low-lying and flood-prone areas to get to higher ground. A shelter was open at Clayton High School.
The Cherry Branch Ferry Terminal on the Neuse River near Havelock is seeing a storm surge of 10 feet above normal levels, according to the NHC.
N.C. 12 is closed on Hatteras Island and parts of U.S. 70 are shut down between Beaufort and Atlantic, as floodwaters covered the pavement, according to the N.C. Department of Transportation.
(Feit is a staff writer for The State newspaper in Columbia, S.C.)
Visit The News & Observer (Raleigh, N.C.) at www.newsobserver.com
Arnhem wil de herinnering aan Operatie Market Garden levend houden | Binnenland | Telegraaf.nl
Sat, 15 Sep 2018 09:08
Extra Het beste van De Telegraaf
Het moet integer en smaakvol blijven: 'Het gaat om het echte, goede verhaal'
Door Olof van Joolen
Vandaag, 05:30 in BINNENLAND
In de VS, Frankrijk en Belgi is het de normaalste zaak van de wereld: slagveldtoerisme. Met souvenirwinkels die onderbroeken, knuffelbeertjes en broodtrommels met wapenschilden van legeronderdelen erop verkopen tot gidsen die rondleidingen verzorgen. In Nederland is het fenomeen nog bescheiden, maar duidelijk in opkomst.
Dirk Hoekendijk, erkend 'slagveldgids' in Arnhem, laat het verleden herleven. 'Pas als je in het terrein staat, voel je hoe het is gegaan'', vertelt de landmachtkolonel b.d. aan de oorlogstoeristen.
''¸ Rias Immink
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Halsema: Gebedshuizen sluiten als dat nodig is | Binnenland | Telegraaf.nl
Sat, 15 Sep 2018 09:07
Dat zou alleen gebeuren als daar 'antidemocratische en anti-integratieve praktijken plaatsvinden'', zei Halsema, in een interview met zender AT5. 'Dat gebeurt alleen in het aller- alleruiterste geval.'' De burgemeester noemt al voorbeeld dat er meerdere keren haatpreken worden gehouden in een gebedshuis.
De burgemeester van Amsterdam wil wel eerder en beter in kunnen grijpen. 'Als orthodoxie overgaat in fundamentalisme ben je niet meer beschermd door geloofsvrijheid.''
Overleg met groepen die niet voor gelijke rechten staan, is ook verleden tijd, zegt Halsema. 'Mensen die de gelijkwaardigheid van man en vrouw niet serieus nemen nodig ik niet uit aan de bestuurstafels.''
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The Brooklyn Bloggers Who Brought Down Paul Manafort
Sat, 15 Sep 2018 09:04
President Donald Trump's indicted former campaign chairman, Paul Manafort, owes his criminal legal troubles, in no small measure, to three ordinary Brooklynites.
One of them, Katia Kelly, is a 56-year-old grandmother who photographs and writes about her Carroll Gardens neighborhood on her blog, Pardon Me for Asking. Last February, Kelly revealed that a dilapidated-looking brownstone that was creating an eyesore two blocks from her home is owned by the Washington super-lobbyist.
''I don't know what to make of all this,'' Kelly wrote on Feb. 16, after examining public records of the 2012 sale of the house and a 2013 renovation permit. ''Maybe one of my readers can interpret these transactions?''
Brooklyn residents and corporate lawyers Matt Termine, who lives a 15-minute walk from the Manafort house, and Julian Russo, who lives in south Brooklyn several miles away, took Kelly up on her invitation; through dogged study of public records of purchases and mortgages during their off-hours and weekends, Termine and Russo uncovered a series of unusual loans and other financial transactions involving the Carroll Gardens property and several others owned by Manafort.
In February they launched their own blog, 377 Union'--named for the address of the Union Street brownstone that Katia Kelly first identified as Manafort's'--a scoop that was recognized by The New Yorker as Manafort's legal problems snowballed in March; ''I was thrilled that this big publication would recognize a local blogger,'' Kelly said.
''It looks like the dismantling of the Trump administration'--I hope, I hope,'' Kelly told The Daily Beast a few hours after a federal court unsealed special counsel Robert Mueller's 31-page, 12-count grand jury indictment against Manafort and his business partner Rick Gates, accusing them of tax evasion and money-laundering. (Both men pleaded not guilty.)
''It's not a bit too soon,'' Kelly added, speaking with the accent of her native Germany. ''Justice does take sometimes awhile, but I'm definitely not surprised, from the moment I realized he was laundering money through my neighborhood. It took me awhile to wrap my head around.''
Like a majority of her neighbors in the New York City Council district once represented by Bill de Blasio, Kelly has little use for the 45th president: ''I think this country has a lot more qualified and much more decent people to chose from for president. And I think Trump is going to be a little hiccup in an otherwise amazing history of this country.''
The 35-year-old Russo, in a joint interview with Termine, said about Monday's news: ''I think it's very exciting if not too surprising'... This feels today like sort of a climactic culmination of all this time we spent along with other people we connected with through our website.''
Termine, 33, noted that three of the properties and transactions they blogged about'--especially 377 Union Street'--are included in the indictment.
When asked if they had been contacted by Mueller's investigators in recent months, Russo fell silent, and Termine said, ''We're actually not able to comment on that'''--the moral equivalent of ''yes.''
Neither lawyer, perhaps needless to say, is a Trump supporter.
''All you have to do is read my Twitter feed,'' Termine quipped.
''I'm not a fan,'' Russo acknowledged.
''It was really a team effort,'' Termine said about their investigation, adding that Kelly ''deserves a lot of credit'' for bringing to light information that ultimately prompted the launch of their own blog and follow-up stories in The New York Times, Wall Street Journal and other mainstream media outlets.
Kelly, the mother of two adult children, said she grew up the daughter of a Michelin Tires executive in Karlsruhe, Germany, and Clermont-Ferrand, France'--the Michelin company headquarters'--and in 1986 moved with her parents to the United States when her father was transferred to Michelin's operations in South Carolina.
She ended up marrying Glenn Kelly, the owner of a Brooklyn-based office-furniture company, and launched her blog around 10 years ago.
''I thought, let me just go and play around with it,'' she said. ''The time I started the blog coincided with a real building boom in Carroll Gardens, and I decided to get more involved with the issues in the community. I realized that the community meetings were very important, but people weren't there. I had just raised two kids and I realized kids have homework, and parents can't just run off to any of these meetings, so let me go and give my opinion on what happened. So I started chronicling the meetings'--it was my giveback to a neighborhood that I've lived in for 32 years.''
Kelly said she came upon her Manafort scoop in February during one of her daily strolls around the neighborhood.
''I was walking around with my camera, as I do on most days'--just the local blogger walking down the street'--and I just happened to walk by this house and wondered, 'What's going on here?' It looked dilapidated, like there had been some construction that had just stopped.''
Kelly started taking pictures of the ''ratty-looking'' brownstone'--an unwelcome sight on a house-proud block lined with meticulously maintained townhouses'--and a resident who lived two or three doors down, clearly not thrilled with the mess, stopped her and said, ''Guess who owns this house? Trump's campaign manager.''
''I guess she just wanted to get it off her chest,'' Kelly recalled. ''It was just a little talk on the corner.''
After her blog post, Kelly said she ''corresponded quite a bit'' with the ''377 Union Guys,'' as Russo and Termine came to be known, ''but I never met them personally.''
Diving into Manafort's real-estate transactions after Kelly's blog post, one of the first red flags Russo and Termine noticed was that 377 Union Street was initially purchased for cash and then remortgaged by the Federal Savings Bank, whose chief executive officer happened to be Trump economic adviser Stephen Calk.
It was, at best, a suspicious coincidence that smacked of self-dealing, the lawyers said.
''We did some analysis of the patterns we were seeing,'' Termine said, noting that over the weekend they posted a comprehensive chronology of Manafort's and his wife Kathleen's real-estate and financial transactions dating from 1981 to the present.
After uncovering Manafort's connection to the loan from Calk on the 377 Union Street house, Termine said, ''over the course of the next six to nine months we posted more'' and eventually made contacts with a growing network of citizen-investigators who shared information on the various transactions'--essentially crowd-sourcing scoops on the former Trump campaign chairman's strange financial history.
''It's not some kind of bold pronouncement about the state of journalism being problematic,'' Russo said, explaining the group effort of amateurs, ''but there is an enthusiasm on on the part of the public to participate more directly in news gathering and news-making, and this development could strengthen and grow'--like grass-roots organizing in politics.''
Termine and Russo, energized by their impact, said they have no plans to cease their blogging.
Katia Kelly, meanwhile, said she was speaking from Surfside Beach, South Carolina, where she was readying a family-owned condominium for the winter.
''While I'm talking to you I'm cleaning the carpet,'' she said. ''That's what I'm doing today.''
The Watergate 'Road Map' and the Coming Mueller Report - Lawfare
Sat, 15 Sep 2018 09:03
According to countless media accounts and President Trump's own lawyers, Special Counsel Robert Mueller is writing some kind of report on allegations of presidential obstruction of justice. Exactly what sort of report this may be is unclear. But to the extent that Mueller is contemplating a referral to Congress of possible impeachment material, he has two historical models of such documents to draw on. One, the so-called Starr Report, is famous and publicly available. The other is a document most people have never heard of: the ''Road Map'' that Watergate Special Prosecutor Leon Jaworski sent to Congress in 1974 and that informed its impeachment proceedings, which were already underway.
The Road Map was very different from the Starr Report. Where Starr wrote a lengthy narrative, the Road Map was reportedly spare. Where Starr evaluated the legal relevance of the evidence he referred, the Road Map apparently contained no analysis and drew no conclusions. And where the Starr Report was in bookstores worldwide and today is just a Google search away, the Road Map is largely forgotten.
There's a reason for that: The Road Map remains under seal at the National Archives. Kenneth Starr couldn't read it. You can't read it. And, remarkably for a document that may be the best model available for his current project, Mueller can't read it either.
The three of us filed a petition on Thursday to the U.S. District Court for the District of Columbia that seeks to rectify this problem. Represented by attorneys at Protect Democracy, we asked the court to unseal the Road Map. We did so because the document is of significant historical interest and significant contemporary interest. As we will explain in this post, which is drawn from declarations that we and others filed in the matter, the Road Map is one of the few significant pieces of Watergate history that remains unavailable to the public. The document is also keenly relevant to current discussions of how Mueller should proceed. It is possible that it is even relevant to discussions taking place within the Mueller investigation itself.
It is time for Jaworski's Road Map to see the light of day.
The Road Map grew out of intensive discussions within the Special Prosecutor's Office about how to proceed against President Richard Nixon for alleged crimes uncovered by the special prosecutor's investigation of the Watergate scandal. The Watergate Special Prosecution Force had obtained important evidence through the grand jury that the House Judiciary Committee had not obtained. Some members of the Special Prosecutor's Office wanted to indict the president for obstruction of justice and related crimes. Others in the office argued that the special prosecutor should draft a presentment charging Nixon with crimes, including obstruction of justice. According to this plan, the grand jury would approve the presentment and the presiding federal district court judge, John Sirica, would transmit it to the House of Representatives for its consideration in deliberations about possible impeachment proceedings against the president.
Jaworski opposed both courses of action. He doubted that a sitting president could be indicted for obstruction of justice. These doubts were informed by his belief that his office should defer to ongoing deliberations in the House Judiciary Committee about whether to impeach the president. And he opposed the idea of sending a grand jury presentment to the House for multiple reasons: He believed that the special prosecutor should not be seen to prejudge issues under consideration by the House, he feared that Judge Sirica would not transmit such a presentment and he wanted to protect the fair-trial rights of the presidential aides he would soon indict.
It seemed possible, therefore, that prosecutors possessed the evidence but not the constitutional authority to use it, whereas the House possessed the constitutional authority but not the evidence.
Jaworski concluded that the best course of action would be for the grand jury, through Judge Sirica, to provide the House with some of the evidence it had collected about Nixon's alleged crimes and let the House decide whether and how the evidence implicated impeachable offenses. The evidence consisted of 800 pages of documents and 13 tape recordings of Nixon's Oval Office conversations. To assist the House in understanding the evidence, the Special Prosecutor's Office included a 55-page ''Road Map'' to the evidence. The Road Map did not contain legal analysis or draw legal conclusions. Each page had a sentence or two of factual statements followed by references to the underlying documents and tapes. As Philip Lacovara, who served as counsel to Jaworski and argued U.S. v. Nixon before the Supreme Court, described the history in a declaration filed with our petition:
we were aware that the House Judiciary Committee, which has jurisdiction over possible impeachments, was conducting an inquiry into whether President Nixon had committed ''high crimes and misdemeanors'' and thus was liable to impeachment. Accordingly, the Special Prosecutor concluded that ... the salient information about the President's own conduct would be transmitted, in an organized form, to the House Judiciary Committee, if that could be done lawfully. I concluded that this course was permissible under Rule 6(e) of the Federal Rules of Criminal Procedure. The Watergate Task Force team then prepared the Road Map.
It was understood that it would be prudent to seek judicial approval for this course before actually releasing the Road Map to the House Judiciary Committee. Accordingly, we sought approval from Chief Judge John J. Sirica, who was supervising all grand jury matters at the time. I presented the arguments supporting release of the material, which both Chief Judge Sirica and the en banc D.C. Circuit approved (one judge dissenting). See In re Report & Recommendation of June 5, 1972 Grand Jury Concerning Transmission of Evidence to House of Representatives, 370 F. Supp. 1219 (D.D.C. 1974), aff'd sub nom. Haldeman v. Sirica, 501 F.2d 714 (D.C. Cir. 1974). The Road Map was then transmitted to the House Judiciary Committee. I understand that House members and staff used the Road Map in determining whether to prepare Articles of Impeachment, which the Committee eventually did.
Judge Sirica stated in his decision permitting the transmission of the document to the House Judiciary Committee that the Road Map contained ''no accusatory conclusions[,] ... no recommendations, advice or statements that infringe on the prerogatives of other branches of government ... [and] no moral or social judgments.''
James Doyle described the Road Map in his book on the Watergate investigation, ''Not Above the Law.'' Doyle, who served as special assistant to the Watergate special prosecutors, wrote of the Road Map:
It was a simple document, fifty-five pages long, with only a sentence or two on each of the pages. Each page was a reference to a piece of evidence'--sentences from one of the tape recordings, quotations from grand jury testimony ... .
This is how the road map worked. One page might say, ''On March 16, 1973, E. Howard Hunt demanded $120,000.'' Then it would list page references to grand jury testimony from witnesses who saw Hunt's blackmail note and references to the tapes where Hunt's demand was discussed. The grand jury transcripts and the tape transcripts would be included ... .
The strength of the document was its simplicity. An inexorable logic marched through its pages. The conclusion that the President of the United States took part in a criminal conspiracy became inescapable.
Judge Sirica later wrote that the evidence and the Road Map saved the House impeachment inquiry months of time. Yet remarkably, given the plethora of Watergate literature and documents that have emerged over the years, the document has remained under seal. Even now, 13 years after the identity of Deep Throat was publicly confirmed, the Road Map remains under lock and key.
The material within it has come out by one means or another. Indeed, what is interesting about the Road Map is almost certainly not the specific information it contains. In July 1974, the House Judiciary Committee published extensive records of its impeachment proceedings. Included among the thousands of pages of documents were the Statements of Information that the committee's impeachment inquiry staff presented at the impeachment hearings from May to July 1974, setting forth the evidence relating to the Watergate break-in and cover-up. The impeachment inquiry staff presented factual statements, with citations to the evidence, while abstaining from conclusions so that each Judiciary Committee member could draw his or her own conclusion. Significantly, too, the published Statements of Information quote the grand jury testimony of many witnesses, citing the evidence provided by the Watergate grand jury as the source. They also reprint pages from the grand jury transcripts. Individuals whose excerpted grand jury testimony appears in these published materials include John Dean, Fred LaRue, Jeb Magruder, L. Patrick Gray, John Ehrlichman, H.R. Haldeman, Richard Kleindienst, E. Howard Hunt, Egil Krogh, Ronald Ziegler, Henry Petersen and Charles Colson.
Later, in January 1975, former special prosecutor Jaworski and his successor, Henry Ruth, testified before the House Judiciary Committee about the obligation of the Special Prosecutor's Office to produce a final report. Both men emphasized that the significant evidence concerning Richard Nixon was already public. ''We do not have 10 more smoking guns lying around our office,'' said Ruth. In other words, don't expect any breaking Watergate news should the court release this document in response to our petition.
Indeed, Lacovara makes clear in his declaration that he ''was surprised to learn that that the Road Map was not released years ago.'' And Richard Ben-Veniste, who served as chief of the Watergate Task Force within the special prosecutor's staff, makes clear in a declaration that there is almost certainly no new substantive Watergate story to break by releasing the Road Map:
the public record of Watergate ... includes, but is not limited to, the articles of impeachment, the Watergate Special Prosecution Force's report, the House Judiciary Committee's report, transcripts and materials relating to the House Judiciary Committee's impeachment hearings, the Senate Select Committee on Presidential Campaign Activities' report, published transcripts of compendiums of the White House tapes, and the records of the public trials of President Nixon's co-conspirators. It is, of course, normal and commonplace that the content of grand jury material becomes public information by reason of its use in subsequent public trials and related proceedings. All of these documents revealed material that we, at one point, treated as grand jury material subject to Rule 6(e). Based on my first-hand recollection of the structure and content of the Road Map, I can confirm that those publications viewed in their totality contained most, if not all, of the information that was referenced in the Road Map.
The primary significance of the document, rather, lies in its role as a kind of model or template for subsequent impeachment referrals, a model that, ironically, has never been available for study and emulation. The Watergate grand jury's transmittal of evidence led to the provision of the now-defunct independent counsel law requiring that independent counsels file impeachment referrals when they develop evidence ''that may constitute grounds for an impeachment.'' (See 28 U.S.C. § 595(c).) Congress appears to have given very little thought to the question of how to enshrine in law a requirement for a Road Map-like referral, leaving open the possibility that independent counsels would take different approaches to referring impeachment material to the legislature. Most members of Congress voting on the law, of course, had never seen the Road Map. But the Road Map was clearly what legislators were thinking about when they wrote this provision, under which Independent Counsel Kenneth Starr referred impeachment material to Congress in 1998.
Starr's staff never got to consult the Road Map. But that wasn't for lack of trying. One of us (Bates) believed that the Road Map might constitute a model worthy of consideration as Starr's staff'--on which he served'--contemplated its own impeachment referral. Although the Road Map was not necessary to the Office of Independent Counsel as a legal precedent'--under Section 595(c), the office could send a report to Congress without a judge's approval'--he was interested in it as a historical precedent for how Starr might proceed. When he asked to see the document, however, an archivist at the National Archives told him in 1997 that he could not see the Road Map because it was still under the seal imposed by Judge Sirica.
Starr eventually took a very different approach'--as did Congress. The Starr Report, which Bates helped draft, contained a detailed narrative and legal conclusions. And Congress made the entire document public. Without getting into the merits of the report's format and Congress's release of it, it is safe to say that this approach generated a great deal of criticism.
The result is that as Mueller reportedly contemplates writing a ''report'' on possible presidential obstruction of justice, there are two models available to him to the extent that he is contemplating an impeachment referral of some kind: One of those, the Starr Report, is well-understood and regarded by many commentators in a negative light. The other, the Road Map, remains secret more than 40 years after its transmission to Congress. Few people have even heard of it.
Special Counsel Mueller is investigating ''(i) any links and/or coordination between the Russian government and individuals associated with the campaign of President Donald Trump; and (ii) any matters that arose or may arise directly from the investigation; and (iii) any other matters within the scope of 28 C.F.R. § 600.4(a).''
There is a lively public debate about the appropriate framework for Mueller to report any findings to Congress of potentially unlawful conduct by the president. In the midst of this debate, there is broad agreement about the potential relevance of the Road Map to Mueller and the decision by Acting Attorney General Rod Rosenstein about whether and how to disclose the fruits of the investigation to the public, as well as to the larger public understanding of and debate about the appropriateness of whatever is disclosed. As Lacovara puts it, ''disclosure of the Road Map is likely to contribute to a public understanding of the options available to Special Counsel Robert Mueller in his current investigation of conduct during the 2016 presidential campaign.''
As Jaworski's deliberations with his staff before settling on the Road Map indicate, an investigation of the president by an executive-branch official, and the possibility of disclosing the fruits of that investigation to Congress, raise difficult and sensitive issues of executive power, separation of powers, and individual rights. Because there are few judicial precedents that expressly govern those issues, the past practices of government actors can inform both legal meanings and proper government practice.
The Road Map is one of only two main precedents in this area. If Mueller decides to send a report to Congress, perhaps through Rosenstein, the Road Map would be a vital touchstone for the public and Congress to assess his actions. It would help the public judge the legality of his actions under the special counsel regulations and the legitimacy of his actions based on a comparison with the Road Map and the Starr Report. If Mueller or Rosenstein decides to issue a report on something akin to the Road Map model, it would be important to compare the level of factual detail that they include in any transmission to Congress with the level of detail in the Road Map.
Even if Special Counsel Mueller does not send a report to Congress, the Road Map would be an important point of comparison in judging the validity of Mueller's failure to issue a report. It would also have broader relevance to journalists and scholars who wish to put the Mueller investigation and any Mueller report in historical context.
The Road Map might also have substantive legal relevance. The question of whether the president can violate a federal obstruction-of-justice statute in the discharge of his duties as chief executive is highly contested. Many of President Trump's actions that his critics say constitute obstruction of justice had parallels in the Nixon presidency. For example, Trump has been accused of obstructing justice, or contributing to such obstruction, in his firing of James Comey as FBI director and in his many statements that the Mueller investigation should end. Similarly, President Nixon fired Special Prosecutor Archibald Cox because he did not approve of some of the steps Cox took in the Watergate investigation. And Nixon stated publicly, in his Jan. 30, 1974, State of the Union address, that ''I believe the time has come to bring that investigation and the other investigations of this matter to an end.'' The House of Representatives, in its first article of impeachment, charged Nixon with obstruction of justice based in part on his ''interfering'' with the conduct of those investigations by various federal agencies, including the FBI. This charge does not necessarily involve a conclusion that the president violated a federal criminal law. It is nonetheless potentially highly relevant to Mueller's thinking about obstruction of justice, and thus to the public's analysis of any decision based on that thinking, whether Special Prosecutor Jaworski cited the Nixon actions listed above in the Road Map as potentially relevant evidence'--and especially if he did so.
It is also reasonable to expect that Mueller might want to consult the Road Map, as Starr's staff hoped to consult it in 1997 and 1998. In seeking judicial authorization to transmit grand jury evidence to the House of Representatives, the special counsel may find it helpful to consider the approach of the Road Map. Indeed, the value of the Road Map as precedent may be much greater for Mueller today than it was for the Office of Independent Counsel in 1997 and 1998. The OIC under Section 595(c), after all, could transmit grand jury material to the House directly. By contrast, Special Counsel Mueller, like Special Prosecutor Jaworski, cannot do so without judicial authorization. The Road Map thus may represent important legal as well as historical precedent for Mueller. Based on the experience of Starr's staff, it is reasonable to expect the National Archives to decline to provide access to the Road Map to the special counsel's staff without an order from the court unsealing the document.
This leaves the question of whether the court has the power to unseal the document. As Protect Democracy argues on our behalf in this memorandum of law in support of the petition, we believe it does. The arguments for continued secrecy under Rule 6(e) are weak, in our view. Almost all of the substantive information in the document has become public. Almost all of the relevant figures are dead. One of the few living individuals whose conduct the Road Map presumably describes, John Dean, filed a declaration stating that, ''To the extent the Road Map refers to my activities relating to the events associated with Watergate, I have no personal objection to disclosure of such information. My privacy interest is not burdened here.'' Dean went on to say that, ''To the best of my knowledge, nearly everyone else who may be implicated by the substance of the Road Map is deceased. The few who are still living would have no reason to object to disclosure of the Road Map given the passage of time, their own disclosures of their roles in Watergate, and the simple fact that the Watergate story is well known.''
In short, the time has come to release what may be the last great Watergate document still kept from the public.
Our complete filings before the court are available here:
Memorandum of Points and Authorities:
Declaration of Stephen Bates:
Declaration of Richard Ben-Veniste:
Declaration of John W. Dean III:
Declaration of Jack L. Goldsmith:
Declaration of Philip Allen Lacovara:
Declaration of Benjamin Wittes:
Was Hawaii Missile Alert More Than Human Error? | American Digital News
Sat, 15 Sep 2018 08:58
By: (Jamie)J.A.L.F.T @jametteriley
This stunt was no accident and the fact that news outlets where there at the time is also no accident. This incident is a FF to get the ability to put in a cancellation feature to interrupt Potus communication to the public.
Note they are now calling for a cancellation process. No no no. This was no accident they want to be able to cancel and override POTUS !
Laura Silsby HCR has access to the software as VP over software for FEMA
Media's Spin ''
Hawaii's false missile threat: Worker who pushed wrong button to be reassignedThe civil defense employee who pushed the wrong button, causing more than a million people in Hawaii to fear that they were about to be struck by a nuclear missile Saturday, will be reassigned, emergency officials confirmed on Sunday. A spokesman with the Hawaii Emergency Management Agency confirmed to Fox News, ''The employee who issued the alert has been temporarily reassigned pending the outcome of our internal investigation. He will still report to work within our Emergency Operations Center, but in a different capacity that does not provide access to the warning system.''
Residents and tourists alike were rattled after the mistaken alert was blasted out to cellphones across the islands with a warning to seek immediate shelter and the ominous statement, ''This is not a drill.''
State officials later said the unnamed employee doing a routine test during a shift change at the Emergency Management Agency mistakenly hit the live alert button.
Rather than triggering a test of the system, it went into actual event mode, Fox News previously reported. Vern Miyagi, who oversees the Hawaii Emergency Management Agency (EMA), said at a news conference late Saturday that to trigger the alert, there is a two-step process involving only one employee '-- who both triggers the alarm, then also confirms it. ''There is a screen that says, 'Are you sure you want to do this?''' Miyagi said. The employee confirmed the alert, inadvertently causing a panic in a state already on edge over saber-rattling missile threats from North Korea.
Miyagi, a retired Army major general, said about the employee late Saturday: ''This guy feels bad, right. He's not doing this on purpose '-- it was a mistake on his part and he feels terrible about it.'' 
Hawaii Rep. Tulsi Gabbard slams Trump after false ballistic missile warning: 'He's not taking this threat seriously'Rep. Tulsi Gabbard, D-Hawaii, slammed President Trump on Saturday for ''taking too long'' to quell escalating tensions with North Korea, minutes after a false ballistic missile warning was sent to residents of her home state. Gabbard said her constituents ''live with the reality of this message popping up on their phones'' at any moment because of the rising conflict between the U.S. and Pyongyang.n
''Donald Trump is taking too long,'' she told CNN. ''He's not taking this threat seriously. There's no time to waste.''
Gabbard, a member of the House Armed Services Committee, added that is an urgent need for easily accessible nuclear shelters. ''We've got to get rid of this threat from North Korea. We've got to achieve peace, not play politics. Because this is literally life and death that is at stake, for the people of Hawaii and the people of this country,'' Gabbard later told MSNBC. 
Former Green Beret Commander: 'Hard to Believe' Hawaii Missile Alert Could Be Sent by One PersonThe Hawaii Emergency Management Agency said an employee selected the wrong option from a drop-down menu, initiating an actual alert instead of a test of the system. On ''America's Newsroom,'' Lt. Col. Michael Waltz (Ret.) said it's ''unbelievable'' that such a system existed in Hawaii.
''I find it hard to believe that this system was developed where one individual could hit one button and send that type of alert without any secondary or third level of authorization,'' said Waltz, a former U.S. Special Forces officer and author.
Waltz agreed that the federal government or U.S. military may have to take over the responsibility for alerting the public to a potential missile attack. Eric Shawn pointed out that North Korean dictator Kim Jong Un is probably ''chuckling'' at being able to cause widespread panic and fear among Americans without even doing anything. 
 Fox News
 Washington Examiner
 Fox News
Paul Manafort Has Nothing Left But Information
Sat, 15 Sep 2018 08:57
Paul Manafort will cooperate with Robert Mueller's Russia investigation - Vox
Sat, 15 Sep 2018 05:12
It finally happened '-- Paul Manafort flipped.
The former Trump campaign chair appeared in court in Washington on Friday and pleaded guilty to a reduced set of charges. And as part of his plea deal with special counsel Robert Mueller's team, prosecutors said, Manafort agreed to cooperate with the investigation.
It's enormously important news for the Russia investigation. Many have long speculated that the special counsel's main aim in charging Manafort with financial and lobbying crimes was to pressure him to ''flip'' '-- so he'd agree to provide information related to their true concern of whether the Trump campaign conspired with Russia to interfere with the election.
Now, it's happened. And that should make President Donald Trump very nervous indeed.
Manafort was convicted of eight counts of financial crimes last month and is expected to face a years-long prison sentence. This new deal will stave off a scheduled second trial for Manafort, which was scheduled to begin in Washington later this month, as well as dismissing 10 mistrial counts from Manafort's Virginia trial last month. Much of Manafort's money and property will also be subject to forfeiture, according to the agreement.
In advance of Manafort's court appearance Friday, Mueller's team filed a new document that drops some charges and lays out what Manafort will admit to. He pleaded guilty to one count of conspiracy against the United States (related to his foreign lobbying work for Ukraine and his finances), and one count of conspiracy to obstruct justice (related to attempted witness tampering earlier this year).
The deal marks the end of one phase of the Mueller investigation. Manafort's prosecution was the most visible activity of the special counsel's office so far. It also appeared to be part of an initial stage of the investigation that involved trying to get key Trump aides to flip by charging them with false statements or financial crimes.
All of which poses the question: What's coming next?
The saga of Paul Manafort's prosecutions It was all the way back in October 2017 that Mueller first indicted Paul Manafort, for conspiracy, undeclared foreign lobbying, financial, and other crimes, alongside his longtime right hand man Rick Gates.
Though we know Mueller investigated Manafort's involvement in Russian interference with the 2016 campaign, this indictment wasn't about that. Instead, it was about years worth of lobbying work the pair did for Ukrainian politicians and government leaders prior to the campaign '-- and about what they did with their money afterward.
Speculation began instantly that Mueller was using these charges to try and pressure both Manafort and Gates to ''flip'' for the Russia investigation. But at first, neither did, and both pleaded not guilty.
Then in February, Mueller filed a new set of tax charges against the pair, again related to the Ukrainian money. (For jurisdictional reasons, he had to file them in Virginia, rather than adding them to the first charges in Washington, DC.) This spurred Gates '-- less wealthy and younger than Manafort '-- to strike a deal. He agreed to cooperate (against Manafort, and potentially more broadly) and pleaded guilty to a reduced set of charges.
Still, Manafort held out. But about four months later, in June, Mueller's team added a new allegation against him '-- that he and a Russian associate, Konstantin Kilimnik, encouraged a likely witness in his upcoming trial to stick to a false story. The new charges led to Judge Amy Berman Jackson finding that Manafort had violated his conditions of release '-- and ordering him jailed (as he has been since).
The Virginia trial ended up being scheduled first, and began on July 31. Gates, and a plethora of other witnesses, took the stand against his former boss. And while Manafort's team managed to get one holdout juror to vote against conviction on 10 counts '-- Mueller won a unanimous conviction on eight others.
With the conviction in the books and Manafort set to face a likely prison sentence, he was still facing at least one more trial (in Washington) and potentially a second (if Mueller retried the Virginia mistrial counts), Manafort finally came to the table '-- and agreed to cooperate.
What does Manafort know?So now that Manafort has flipped '-- what does he know about collusion or conspiracy between the Trump campaign and the Russian government during the 2016 campaign?
Previously, Manafort has said the answer is: nothing. That no collusion happened, so he would naturally have no information on this to provide.
But it's seemed likely that Mueller has long believed otherwise, given his intense focus on Manafort. And there are two curious happenings during the campaign in particular that Manafort was involved in (that we know about).
The Trump Tower meeting: For one, there's that infamous meeting at Trump Tower that Donald Trump Jr. set up in June 2016 with a Russian lawyer and other Russia-tied figures. The three attendees of that meeting on the Trump side were Don Jr., Jared Kushner, and Manafort. No attendee has become a cooperator for Mueller. Perhaps the special counsel does think more remains to be learned about this meeting and hopes Manafort will tell him about it.
Oleg Deripaska and Konstantin Kilimnik: Perhaps even more suspicious are Manafort's surreptitious contacts with two Russian nationals during the campaign. There's his former client, the oligarch Oleg Deripaska, to whom Manafort was heavily indebted. And there's Manafort's longtime business associate Konstantin Kilimnik, who Mueller's team has said is tied to Russian intelligence.
Just weeks after joining the Trump campaign, Manafort seemed to see an opportunity. He emailed Kilimnik in early April about his newly high media profile, writing, ''How do we use to get whole,'' and ''Has OVD operation seen?'' (Those are Deripaska's initials.)
Then in July 2016, Manafort and Kilimnik exchanged emails about Deripaska again, as the Washington Post and the Atlantic reported last year. ''I am carefully optimistic on the issue of our biggest interest,'' Kilimnik said. ''He will be most likely looking for ways to reach out to you pretty soon.'' Manafort wrote that if Deripaska ''needs private briefings we can accommodate.''
The pair's emails on the topic grew vaguer and more cryptic as the summer continued. In late July, Kilimnik wrote to Manafort, ''I met today with the guy who gave you your biggest black caviar jar several years ago. We spent about 5 hours talking about his story, and I have several important messages from him to you.'' This, again, is believed to be about Deripaska, with ''caviar'' thought to be code for money.
Kilimnik and Manafort arranged a meeting in New York City to discuss the matter on August 2 '-- Kilimnik wrote that he had a ''long caviar story'' to tell and ''several important messages.''
Days after the meeting, Deripaska took a yacht trip with Sergei Prikhodko, Russia's deputy prime minister, who is focused on foreign policy. Again, all of this occurred while Manafort was chairing the Trump campaign, before his mid-August 2016 firing.
Now, this year, Kilimnik seemed keenly interested in keeping Manafort out of jail '-- he was indicted alongside Manafort for obstruction of justice in June, for allegedly trying to get witnesses to give a false story. Yet Kilimnik is unlikely to ever face those charges since he's currently based in Moscow.
We still don't know what happened between Manafort, Kilimnik, and Deripaska during the campaign. Maybe this where the action on Trump campaign/Russia collusion happened. Or maybe Manafort was just freelancing and trying to get himself paid, and it doesn't involve Trump personally. But it's one of the biggest loose ends about what happened in 2016.
Whatever the case, Manafort has now committed to tell the Mueller the truth. So buckle up.
British Lawmaker Wants to Ban Your Private Facebook Groups Because She Worries You're Using Hate Speech - Hit & Run : Reason.com
Sat, 15 Sep 2018 03:31
Joel Goodman/ZUMA Press/Newscom U.K. Parliament member Lucy Powell of the Labour Party wants to use her government authority to ban your private online group discussions.
I'm not exaggerating here. Powell introduced legislation in the House of Commons this week that would ban secret, private, invite-only groups on Facebook. It would go so far as to hold moderators legally responsible for hate speech or defamation on the forums.
Powell believes that secret online groups are responsible for radicalization (rather than the more logical likelihood that radicalization prompts people to seek out private online outlets). And she has this strange idea that outrageous ideas presented on social media outlets simply don't get challenged. She writes in The Guardian:
Online echo chambers are normalising and allowing extremist views to go viral unchallenged. These views are spread as the cheap thrill of racking up Facebook likes drives behaviour and reinforces a binary worldview. Some people are being groomed unwittingly as unacceptable language is treated as the norm. Others have a more sinister motive.
While in the real world, alternative views would be challenged by voices of decency in the classroom, staffroom, or around the dining-room table, there are no societal norms in the dark crevices of the online world. The impact of these bubbles of hate can be seen, in extreme cases, in terror attacks from radicalised individuals. But we can also see it in the rise of the far right, with Tommy Robinson supporters rampaging through the streets this summer, or in increasing Islamophobia and antisemitism.
In fact, extremist views get challenged all the time, online and elsewhere, by people like Powell and by many, many others. But she doesn't really mean that these views aren't being "challenged." What she means is that these radical views aren't being punished.
Powell notes that allowing private groups to exist "locks out the police, intelligence services and charities that could otherwise engage with the groups and correct disinformation." By "correct disinformation" she actually means "prosecute people." She doesn't say as much in her Guardian column, but her motion for consideration of the bill explicitly says that too few people have been prosecuted under the United Kingdom's Communications Act, which criminalizes online hate speech. She makes it clear that she doesn't think enough people are being punished by the government for saying bad things. This is not about correcting disinformation at all:
[O]nline hate crimes are still rarely prosecuted and go largely unreported. Our laws desperately need to catch up. Today I am proposing a small step to establish clear accountability in law for what is published on online forums and to force those who run the forums no longer to permit hate, disinformation and criminal activity.
The Evening Standard notes that the members of Parliament who support Powell's bill have themselves been subjects of online harassment. So most certainly part of this push involves elected government officials trying to stop people from saying stuff about them that they don't like under the guise of protecting citizens from harassment.
Powell talks about extremists trying to radicalize people into violence, but a look at how hate speech laws in U.K. are actually investigated paints a different picture. Over the weekend, viral outrage (of the like Powell worries about) erupted when the South Yorkshire Police tweeted out encouragement for citizens to report incidents of hate to them, even if they weren't even crimes under U.K. law:
In addition to reporting hate crime, please report non-crime hate incidents, which can include things like offensive or insulting comments, online, in person or in writing. Hate will not be tolerated in South Yorkshire. Report it and put a stop to it #HateHurtsSY pic.twitter.com/p2xf6OLoQZ
'-- SouthYorkshirePolice (@syptweet) September 9, 2018After people complained that the tweet was reminiscent of Orwellian speech controls, the police department's chief constable responded that they had been misconstrued and that people were exaggerating the department's intent. He says he wants to keep track of what's going on in the community to engage in "proactive police work to try and stop crimes from happening in the first place."
But thanks to the United Kingdom's hate speech laws, that's actually what makes the department's behavior "Orwellian." The "crimes" he is trying to stop involve people expressing opinions that the government has officially declared hateful and off-limits. One reason his police department wants to investigate is to tell people they aren't allowed to say certain things.
And now M.P.s like Powell are deliberately looking for more opportunities to track down and punish people for saying things the government finds hateful, going so far as to try to ban private groups on social media entirely because the police cannot snoop on them. The privacy of your secret little online group where you complain about your neighbors (and perhaps even your local police!) is jeopardized because Powell thinks you're going to turn people violent.
Chris Cornell's Widow: I Have 'Several Unanswered Questions' '' Rolling Stone
Sat, 15 Sep 2018 03:29
Two weeks after being ''hopeful that further medical reports will provide additional details'' about Chris Cornell's death, the musician's widow Vicky Cornell claims in a new statement that she is ''mystified that the medical examiner announced a cause of death when the full autopsy report has not been completed.''
Kirk Pasich, Vicky Cornell's attorney, claims that a Freedom of Information Act request for ''reports relating to Chris Cornell's death'' was denied by the City of Detroit Law Department.
''Based on information provided by personnel from the City of Detroit Police Department (DPD) Homicide Section, it is our understanding that this matter is an open investigation,'' Pasich claims the reply stated. ''As such they believe that the release of any information at this time, including the records identified in your request, would compromise and/or interfere with their investigation.''
Last month, following the singer's death at age 52, Vicky claimed that Cornell had taken anxiety medication Ativan the night he took his own life and questioned if the medication had contributed to his death.
''When we spoke after the show, I noticed he was slurring his words; he was different,'' she wrote. ''When he told me he may have taken an extra Ativan or two, I contacted security and asked that they check on him. What happened is inexplicable and I am hopeful that further medical reports will provide additional details. I know that he loved our children and he would not hurt them by intentionally taking his own life.''
Pasich reiterated Vicky Cornell's statement at the time, claiming that the release of a complete toxicology report was necessary for Cornell's death to be fully investigated. ''Without the results of toxicology tests, we do not know what was going on with Chris '-- or if any substances contributed to his demise,'' he said. ''Chris, a recovering addict, had a prescription for Ativan and may have taken more Ativan than recommended dosages. The family believes that if Chris took his life, he did not know what he was doing, and that drugs or other substances may have affected his actions.''
In the new statement, Pasich asserts that Vicky Cornell had not viewed any police or toxicology reports pertaining to Cornell's death. While the City of Detroit has declined to release the police report, citing an ''open investigation,'' a leaked copy, obtained by the Detroit News, notes that Cornell's bodyguard Martin Kirsten said he accompanied the singer to his hotel room to help fix his computer and give him two Ativan ''which victim takes for anxiety,'' according to the report.
Soon after, Cornell and Vicky spoke on the phone, with the singer, according to the police report, slurring his words, admitting he may have taken too much Ativan and repeatedly saying ''I am just tired'' before abruptly hanging up. (Cornell disputed the police report's claim regarding her husband's last words to her on Twitter.)
Following that conversation, Vicky Cornell called Kirsten to check on her husband. After kicking open Cornell's hotel door and bedroom door, Kirsten found Cornell ''laying on the bathroom floor'' with blood running down his mouth and a red exercise band around his neck. A doctor pronounced Cornell dead at 1:30 a.m.
Cornell penned an open letter to her husband last month following his death, writing, in part, ''We had the time of our lives in the last decade and I'm sorry, my sweet love, that I did not see what happened to you that night. I'm sorry you were alone, and I know that was not you, my sweet Christopher. Your children know that too, so you can rest in peace.''
Detroit police have not revealed when Cornell's toxicology report will be released. ''We are grateful for the outpouring of support as we mourn Chris' passing, but we still have several unanswered questions about what led to his death,'' Vicky Cornell added in the new statement. ''We believe the toxicology report will answer these questions.''
Full Statement by Cornell Family Attorney and Vicky Cornell
Kirk Pasich, attorney for the family of the late Chris Cornell, today said that the City of Detroit Law Department denied a request his firm made under the Freedom of Information Act for reports relating to Chris Cornell's death, stating: ''Based on information provided by personnel from the City of Detroit Police Department (DPD) Homicide Section, it is our understanding that this matter is an open investigation. As such they believe that the release of any information at this time, including the records identified in your request, would compromise and/or interfere with their investigation.''
Mr. Pasich confirmed the family has not yet seen any of the police or toxicology reports, noting that the family remains mystified that the medical examiner announced a cause of death when the full autopsy report has not been completed.
Given the information above, Mr. Pasich said that the family hopes there will be an end to speculation about the cause of Mr. Cornell's death while the family awaits the definitive and complete reports. Vicky Cornell, the late star's widow, said, ''We are grateful for the outpouring of support as we mourn Chris' passing, but we still have several unanswered questions about what led to his death. We believe the toxicology report will answer these questions.''
Chris Cornell's most memorable moments: Soundgarden's grunge classics, Audioslave's hits and his poetic solo material. Watch here.
Tesla Model 3 Stolen From Mall of America Using Only a Smartphone
Sat, 15 Sep 2018 03:22
A little bit of social engineering can go a long way.
With cars becoming more connected than ever, cybersecurity is a hot-button topic that extends past your computer screen and into your car. Using a bit of technology, an alleged car thief was able to get his hands on a Model 3 at the Mall of America and drive away without needing a key. The alleged crime was reportedly committed via smartphone.
A computer forensics specialist who commented on the happenings of the incident was able to narrow down just how the alleged stolen Tesla was taken with such reported ease. The person allegedly responsible for taking the car is believed to have reached out to Tesla's customer support to add the stolen Model 3 to his Tesla account by its vehicle identification number. Once the vehicle was accessible on a smartphone that was signed into this person's account, he was reportedly able to unlock the car and drive away without ever needing a key.
Several days later, the alleged car thief was tracked down and arrested in the stolen car in Waco, Texas, more than 1,000 miles south of its starting point in Minnesota. Since this person disabled GPS tracking on the car, the owner had to utilize a different method of tracking down the alleged crook. The owner tracked the location of the car's Supercharging and provided it to local authorities where they promptly located the car and arrested the man behind the wheel.
The Tesla is owned by a company called Trevla, a Tesla rental company located inside of the Mall of America. The 21-year-old alleged car thief had previously rented vehicles from the company at least six times prior to the alleged theft, confirmed a local news station with the owner of the company. The owner also recalled this same person supposedly bragging about the extensive knowledge he held regarding Tesla's security systems, ultimately leading the rental company to suspect this particular regular customer when the vehicle came up missing.
The automaker told Electrek that the alleged car thief likely had previously rented the vehicle and had an already-authenticated phone as a result. The owner of Trevla reportedly refuted this claim, stating that he had removed the phone's access following this person's prior rental. At the time of writing, Tesla did not respond to The Drive's request for comment.
Tesla has enabled keyless entry and driving in its vehicles for quite some time, enabling the convenience of driving using only one's phone is a luxury which most people have yet to experience just how insanely convenient it can be. Unfortunately, convenience can also be a point of entry from a cybersecurity perspective. The Model 3's primary use of entry and driving is a linked smartphone, using only a backup keycard to keep handy in a wallet or purse in case of emergencies.
Though Tesla has the highest rate of theft recovery, it still looks to reduce the number of events which occur. Recently Tesla has addressed this problem by adding a PIN-to-drive function. This enables owners to require a PIN (in addition to a key fob or authenticated phone) before actually driving off with the vehicle.
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Who Will SpaceX Send to the Moon? - The Atlantic
Fri, 14 Sep 2018 21:36
Only 24 people have been to the moon. They were all American, male, and white.
So, who could this mystery moon traveler be?
In February of last year, SpaceX announced it would send two paying customers on a trip around the moon aboard the company's Falcon Heavy rocket sometime in 2018. The plan never materialized, likely because Musk eventually decided not to certify the Heavy for human spaceflight and focus on the development of the BFR instead. The identity of these private citizens was never revealed, though Musk did say that ''it's nobody from Hollywood.'' The passenger SpaceX plans to fly on the BFR may be one of them.
The passenger doesn't have to be a U.S. citizen. SpaceX will someday fly Americans, yes, but these will be the astronauts that NASA has chosen to test the company's crew transportation system, which the space agency wants to use to ferry astronauts to and from the International Space Station. Unlike that project, the BFR is not affiliated with or funding by NASA. After the announcement Thursday, when a Twitter user mused whether the lucky passenger may be Musk himself, Musk responded with the emoji for the Japanese flag, prompting some to throw out names of wealthy Japanese individuals with an interest in tech. Russia, China, and India have all said they hope to put their astronauts on the moon, with India aiming to do so as early as 2022. SpaceX may beat them, and give another country the historic first.
Perhaps the voyage will record another first, for women. The Soviet Union sent the first woman to space, Valentina Tereshkova, in 1963. Twenty years later, the United States sent Sally Ride. As of March of this year, 60 women from nine countries have gone to space, and several of them have made multiple trips, according to NASA. But none have been to the moon.
The bottom line, of course, comes down to money. The BFR passenger is a paying customer, which means they are certainly very, very rich. SpaceX is quite secretive about the cost of flights on Falcon 9, its workhorse rocket, but even that may not be the best comparison. The BFR will be much bigger than a Falcon 9, and in spaceflight, the heavier something is, the more expensive it is to launch. Virgin Galactic, Richard Branson's spaceflight company, will charge $250,000 per ticket on its winged space plane, which is undergoing testing. Blue Origin, Jeff Bezos's company, will reportedly charge between $200,000 and $300,000 per ticket for flights on its New Shepard vehicle, also still being tested. But both of these will provide suborbital spaceflights, which means passengers will not leave low-Earth orbit. The farther you travel in space, the more expense it gets.
The BFR, which Musk first described in 2016 as part of his long-term goals for a Mars mission, is still under development. The launch system will have include two reusable stages, a booster, and a spaceship that can hold dozens of passengers. Gwynne Shotwell, SpaceX's chief operating officer, has said that the company will begin testing small, suborbital ''hops'' of the launch system late next year and predicts the BFR will be orbital ''in 2020 or so.''If this concept becomes reality, the mystery passenger'--and the flight engineers picked to accompany them'--will have plenty of leg room. Their experience will be very unlike that of Jim Lovell and his fellow astronauts, who were packed like spacefaring sardines in the lunar module. The view, however, will be the same. The window will fill up with the slate gray of the moon, with the texture of the ridges and craters of its surface. And then, as the spaceship circles the moon, the Earth will slink into view from behind it. ''Oh, my God! Look at that picture over there! Here's the Earth coming up. Wow, is that pretty!'' exclaimed one of the NASA astronauts 60 years ago when he snapped a photograph of that view, the now iconic ''Earthrise'' shot. Whoever the mystery SpaceX passenger is, let's hope they don't forget to pack a camera.
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Marina Koren is a senior associate editor at
Where Did Brett Kavanaugh Go to High School? | Heavy.com
Fri, 14 Sep 2018 20:45
Getty Brett Kavanaugh went to high school in Maryland, at an elite prep school that Neil Gorsuch also attended. Kavanaugh is now reportedly the target of a sexual misconduct allegation from those years.
Brett Kavanaugh attended high school at Georgetown Preparatory School, an elite Maryland high school that's home to several famous political alums.
Kavanaugh's alma mater has been the source of controversy several times over the course of his confirmation hearings. First, it was a point of controversy when Kavanaugh argued that he grew up in a city ''plagued by gang violence.'' Kavanaugh actually grew up in Bethesda Maryland, though he lived close to dangerous parts of D.C.
Now, it's an increasing point of controversy as the result of a letter that has been handed over to the FBI by Sen. Dianne Feinstein, which several publications are reporting contains a sexual misconduct allegation dating back to Kavanaugh's high school years.
According to The Huffington Post, the letter in question was sent to Rep. Anna Eshoo, though the confidentiality of the woman in question has been preserved. Additionally, The Huffington Post claims that Debra Katz, a well known lawyer of the #MeToo movement, is representing the anonymous letter writer.
Georgetown Prep is an all-boys school in Bethesda, Maryland. Here's what you need to know about Kavanaugh's high school years.
Georgetown Prep Costs up to $60,000 a Year & Has Its Own Golf Course & Recording StudioNEW: Two officials familiar with the matter say the incident detailed in the Feinstein letter involved possible sexual misconduct between Judge Kavanaugh and a woman when they were both in high school.https://t.co/6UI9DSPiMJ
'-- Nicholas Fandos (@npfandos) September 13, 2018
Georgetown Prep is a boarding school of just under 500 students. It's a rigorous school, academically, with the average SAT score being 1386 (out of 1600).
It sits on 93 acres of land, which include the following, according to its site: ''collegiate-level facilities and includes a basketball arena, four full-size practice courts, a 200-meter indoor track, a double-ring wrestling room, a fitness center, and a state of the art pool with a diving well. The construction of the Hanley Center enabled Georgetown Prep in 2010 to convert its former gymnasium into a first-rate learning facility, the George Center, which includes a magnificent library, eight classrooms, a recording studio, a student union, several offices, and the Boardroom.''
Kavanaugh Graduated From Georgetown Prep in 1983"I grew up in a city plagued by gun and gang and drug violence." Kavanaugh's high school, Georgetown Prep, literally has an on-campus golf course. pic.twitter.com/0mDur3ecLD
'-- Steve Morris (@stevemorris__) September 5, 2018
Kavanaugh graduated from Georgetown Prep in 1983. He and Gorsuch were actually at the school at the same time, Kavanaugh being two grades ahead of Gorsuch. Other graduates of Georgetown prep include four current or former ambassadors and two sitting congressmen, according to The Washington Post.
Georgetown Prep was founded in 1789 alongside Georgetown University, and has a Jesuit-based educational foundation.
Kavanaugh Has Claimed That Georgetown Prep Taught Him to Live the Creed of 'Men for Others'People from ANYWHERE in DC! For those unaware, that's akin to citing your intimate knowledge of gun violence in 1990s South Central L.A. when you lived in Malibu Colony. Look at his high school (Georgetown Prep): 93 acres for 491 students. pic.twitter.com/Z7AyKjKQzf
'-- TKWallace (@TKWallace4) September 8, 2018
During his opening remarks as a Supreme Court nominee, Kavanaugh noted that Georgetown Prep inspired his life motto. He said,
''The motto of my Jesuit high school was 'Men for others.'' I've tried to live that creed. I've spent my career in public service from the executive branch in the White House to the U.S. Court of Appeals for the D.C. Circuit. I've served with 17 other judges, each of them a colleague and a friend.''
The president of Georgetown Prep Rev. James R. Van Dyke, has publicly congratulated Kavanaugh on his nomination, writing in a statement on the school website, ''He is a proud Prep alumnus and holds the school in the highest regard. Judge Kavanaugh has Georgetown Prep's prayers and support as he faces the confirmation process.''
The school has not yet commented on the potential allegations against Kavanaugh.
READ NEXT: Debra Katz, #MeToo Attorney: 5 Fast Facts You Need to Know
The Unraveling of Ellen Pao and Her Husband, Buddy Fletcher | Vanity Fair
Fri, 14 Sep 2018 17:18
It was in the spring of 2008, shortly after their marriage, when the hedge-fund manager Buddy Fletcher and his wife, Ellen Pao, a Silicon Valley venture capitalist, bought their first home in San Francisco. Situated on the 23rd floor of the exclusive St. Regis Residence, the $3.85 million, three-bedroom apartment seemed to float above the city, with its walls of windows'--set above built-in benches of honed cream limestone'--offering spectacular views of the Bay Bridge. At nearly 2,600 square feet, it had a vast chef's kitchen, but also room-service dining, along with butler and concierge service'--luxuries that attested to the couple's wealth and their success.
Alphonse ''Buddy'' Fletcher was well-known on Wall Street. His hedge-fund company, Fletcher Asset Management'--with a reported $500 million in assets'--may not have been the biggest, but its results over the years were reported to be staggeringly impressive, at times as high as 350 percent. In 2009, when Fletcher was 44 years old, Forbes named him one of the country's richest African Americans, estimating his net worth at $150 million. And he had been generous with his wealth. He donated millions of dollars to cultural institutions'--including the Metropolitan Museum of Art, schools, libraries'--and to civil-rights causes, including a headline-grabbing pledge of $50 million for fellowships whose recipients included Anita Hill and Elizabeth Alexander, the 2009 inaugural poet. At Harvard, his alma mater, a $4.5 million gift finances the Alphonse Fletcher University Professor, which is held by the prominent critic and scholar Henry Louis ''Skip'' Gates Jr.
Hers was perhaps a quieter success. At 38, Ellen Pao was a junior partner at Kleiner Perkins Caufield & Byers'--if no longer the leading venture-capital firm in the Silicon Valley, then certainly the most venerable. A former corporate attorney who had worked at several tech companies, including Microsoft, she did not attract headlines, as Fletcher had, but she nevertheless had a foothold in the higher circles of the business world. The daughter of Chinese immigrants, Pao's r(C)sum(C) was as gold-plated as Fletcher's. A Princeton graduate, she also had Harvard law and business degrees. Fletcher and Pao had married just six months before they bought the apartment. Their marriage, barely four months after they met, had surprised some friends, in large part because, for several years, Fletcher had been living with his longtime boyfriend, Hobart ''Bo'' Fowlkes Jr. But whatever had brought them together, they resonated as a couple. With their wealth and success, theirs was a powerful American Dream narrative'--a story of obstacles overcome, and brilliance, hard work, intense drive, and ambition rewarded.
And then everything seemed to fall apart. During the last two years, Fletcher and Pao have become embroiled in bitter and sensational conflicts that have been the talk of Wall Street and Silicon Valley. In February 2011, to the shock and titillation of New York society, Fletcher sued the co-op board of the Dakota, the iconic 129-year-old apartment building on Manhattan's Upper West Side whose famous residents have included Yoko Ono, Lauren Bacall, and Leonard Bernstein, and where John Lennon was shot to death in 1980. Furious when the Dakota's board denied his application to buy his fourth apartment in the building, a $5.7 million two-bedroom, Fletcher sued the board for racial discrimination. In his complaint, Fletcher painted the Dakota, one of the city's most exclusive co-ops, as a hive of bigotry, where victims were said to include the singer Roberta Flack and the actor Antonio Banderas.
A little more than a year later, in May 2012, Ellen Pao dropped her own bombshell lawsuit, alleging that she had been the victim of sexual discrimination by Kleiner Perkins. Her exhaustively detailed, sometimes lurid allegations roiled Silicon Valley. There was inter-office sex, steamy advances from senior partners, client dinners to which only men were invited, because, according to Pao, one partner told her women ''kill the buzz.'' Equally shocking to many was Pao's claim that she had complained repeatedly to Kleiner's management, including to John Doerr, a senior partner and the much-respected dean of the Valley, and that she had been ignored.
VALLEY GIRL Ellen Pao and her former boss and mentor, Kleiner Perkins's legendary venture capitalist John Doerr. Pao is suing Kleiner for sexual discrimination., By Marcio Jose Sanchez/AP Photo.
The response to both lawsuits was stinging. As the Dakota board would tell the court, Fletcher's application had been rejected because the co-op's finance committee'--a group of high-powered financiers and lawyers'--had concluded that Fletcher could not afford the apartment. Far from being a successful hedge fund, Fletcher's F.A.M., according to the Dakota, was overstating its assets and losing money. But that was only the beginning. The Dakota lawsuit'--which is winding its way to trial in New York's State Supreme Court'--set in motion a series of events that have put Fletcher on the ropes financially. Today, F.A.M. is being sued by three Louisiana public pension funds trying to recover $145 million; his main hedge fund filed for bankruptcy; others were ordered liquidated by a Cayman Islands judge; and aspects of his business are under investigation by the S.E.C. and the F.B.I. Kleiner Perkins denied that Ellen Pao had been discriminated against'--firing back in a high-stakes battle in which a settlement could reach as high as $100 million. It also said that, despite her claims to the contrary, Pao had never, during the five years in which she alleged she had been harassed and discriminated against, complained to anyone at the firm. All of which only intensified the ongoing mystery of what really happened to Ellen Pao and Buddy Fletcher.
Born in New London, Connecticut, in 1965, Buddy Fletcher was the oldest of Alphonse and Bettye Fletcher's three sons. His father, who had come north from Louisiana after enlisting with the Navy, worked as a technician at the General Dynamics submarine plant in nearby Groton. His mother was a teacher, a principal, and eventually an administrator in the public-school system. Particularly gifted in math'--he created his first computer program, which predicted the outcome of local dog races, when he was 11'--Fletcher graduated from Waterford High School at the top of his class. He entered Harvard in 1983, where he majored in applied mathematics.
His classmates remember him as warm and gregarious, someone for whom ''it was really important to be liked,'' says one. While other African American students at Harvard often felt sidelined, Fletcher, friends say, worked hard to fit in. Hugely popular, he was a member of the exclusive, all-male ''finals club,'' Phoenix S.K., and voted first marshal by his senior class. One friend recalls how out of place Fletcher felt when he first arrived at Harvard: ''There were all these white kids from prep schools who knew what was going on, and he didn't. He'd gone to public schools. It was like, right away, his first trip home when he told his parents: prep schools'' for his brothers, Todd and Geoffrey'--both of whom eventually also went to Harvard. Todd, now a composer, was quickly sent to Andover, and Geoffrey, a screenwriter, who won the 2010 adapted-screenplay Oscar for Precious, was shipped off to Choate. But if there was the easygoing, fun, friend to all Buddy Fletcher, there was also the straight-backed, perfectly tailored, reserved Fletcher'--cautious and precisely spoken, in sentences ''from which all traces of slang or irony have been excised,'' as The New Yorker wrote later. At a time when Harvard would not permit R.O.T.C. on its campus, Fletcher joined the Air Force R.O.T.C. at M.I.T. On a largely liberal campus, he was a staunch Reagan Republican. He was ''a complicated guy,'' recalls his former classmate Michael Meade. ''There were a lot of competing forces there.''
Fletcher, who did not respond to requests for comment, graduated from Harvard in 1987. He went to work on Wall Street as an equities trader at Bear Stearns. Two years later he was lured to Kidder Peabody by a huge compensation package. Later, Fletcher claimed he was offered a base salary of $100,000 and told, in a phone conversation, that he would get a bonus of 20''25 percent of his trading profits. There is no question that Fletcher did extremely well at Kidder. By 1990, when he was only 24, Fletcher was one of the highest paid employees at the investment bank. That year his trades generated $25.5 million in profits, which he said should have entitled him to a bonus of at least $5 million. But late in the year, Kidder told him they would pay him only 10 percent of his profits. The firm was struggling; it lost $24 million in 1990'--and it denied it ever offered him a fixed percentage of his trading profits.
Fletcher was furious. He resigned and, several months later, sued Kidder for racial discrimination. In his complaint, which demanded nearly $30 million in damages, he would say that he had been told that his promised $5''6 million bonus ''was too much money to pay a young black man.'' Eventually, the New York Stock Exchange arbitration panel ordered Kidder to pay Fletcher another $1.3 million in bonus, but it dismissed his claim of racial discrimination. Kidder was sold to PaineWebber in 1994, but among some of the firm's former executives, the bitterness at Fletcher still lingers. ''He thought he was the king of the world, and that people around him weren't smart enough to understand what he was doing,'' says one, who also remembers that throughout the negotiations Fletcher ''never lost his temper.'' For Fletcher, this seems to have been a point of pride. As he told The New Yorker in 1996: ''Oh, I was very good at not being furious,'' he said, smiling. ''Actually, I can't stand confrontation. I'd sooner walk away.''
By 1996, Fletcher Asset Management had been in business for nearly five years. Headquartered on the 48th floor of the General Motors building, its offices were lavish, with spectacular views of the New York skyline, a private chef on staff, and a personal dining room with a full-time waitress. Fletcher, who had bought his first apartment in the Dakota in 1992, would be driven to work in what the press would describe as his ''string of chauffeured cars,'' which included a Bentley, a Jaguar, and a Mercedes. When Fletcher moved F.A.M.'s offices to a townhouse on East 66th Street, he had it completely renovated and decorated by his boyfriend, Bo Fowlkes, a writer and photographer whom Fletcher had met in 1993. Fletcher bought a $4.6 million home in Montauk. He also had a $5.9 million, 17-room mansion in Cornwall, Connecticut, which was referred to as ''the castle,'' and he would eventually own close to 1,100 acres of surrounding forestland. One business publication referred to his cars and homes as his ''playboy trappings,'' but friends say his lavish lifestyle had a serious purpose.
''It was very important to him, at that age, because he was so young, and successful, and black. It was hard for him to find people to invest with him, or to do business with him, because they didn't take him seriously,'' says Fowlkes. ''I think that a lot of these outward trappings of wealth, like a fancy car with a driver, and a fancy address, were ways of saying, Pay attention to me. I'm for real. I can help you.'' And there were other reasons for the car and driver; as he would tell The New Yorker, it was easier than standing on a New York street corner and trying to get a cab to stop for a black man. Many just drove on by. ''And not just when Buddy was hailing them,'' recalls Fowlkes. ''There were a few times when we were together and I would flag down the cab. It would stop, and then Buddy would approach, and it would drive off'--with my hand still on the door.''
As difficult as it had been for Fletcher, by 2001, F.A.M. was reporting 10 years of unbroken profits. The fund was lionized in the business press for its ''triple-digit returns,'' generated by ''math wizards,'' using ''complex computer programs'' to do an ''arcane form of stock trading timed to dividend payouts.'' Who his investors were was not always clear. But Fletcher told one interviewer in the 90s that he didn't just accept any investor; they had to be ''screened.'' F.A.M., he said, was only looking for ''supportive investors.'' The same caution seemed to hold with whom he hired. For years, his brother Todd served as head of investor relations; his mother ran his philanthropy program; his boyfriend, Fowlkes, ran the firm's marketing and conference programs. F.A.M. was also staffed with several of Fletcher's friends from Harvard.
There were conflicts; several friends were fired, including Michael Meade, who had also worked at Kidder with Fletcher. In 1995, Meade sued Fletcher, claiming that Fletcher had reneged on their deal to split F.A.M.'s profits. The lawsuit was sealed by the court, but according to a 1995 A.P. report before that happened, Meade alleged that, while Fletcher had paid himself a $1.65 million bonus in 1994, he had refused to pay one to Meade and had also not paid investors a dividend. Meade also alleged that Fletcher had fired him after Meade had rebuffed Fletcher's sexual advances. Fletcher denied the allegations to the A.P., and eventually the two men came to a confidential settlement. Meade will not comment on the case today, except to say that after several years of not speaking to each other, he and Fletcher resumed their friendship.
MOTHER KNOWS BEST Buddy Fletcher's brother, Oscar-winning screenwriter Geoffrey, and their mother, Bettye, in 2012., By PATRICK MCMULLAN/ PatrickMcMullan.com.
Fletcher was not easy to work for. He could fly into rages. He was extremely critical of others, and of himself. ''Buddy could not fail,'' one friend says. ''He had to be the best; not as good as other people, or better'--the best.'' ''I do think Mom and Dad, especially Mom, have a lot to do with what has gone on in the last few years,'' says one friend. Both Fletcher's parents encouraged their sons to achieve, but their mother, says a friend, was ''intense.'' Fletcher's father, who died in 1990, shortly before the blowup at Kidder Peabody, was the easier parent. Bettye Fletcher, another friend says, ''was just one of those mothers whose children were never allowed to fail''; she pushed her boys, who often seemed ''terrified of displeasing her.'' Some friends believe that Buddy Fletcher was not ever as keen on his Wall Street career as his mother was. He loved the outdoors, and animals, and teaching'--''Buddy was never happier than when he was explaining math to children,'' recalls a friend. But his mother enjoyed the perks of wealth, and her son's prominence. ''When she speaks about Buddy's wealth, she gives the impression it's a family fortune,'' says one friend. A handsome and elegant woman, Dr. Fletcher'--as she insisted on being referred to since she completed her Ph.D. in education at Columbia'--is, even in their adulthood, a very strong presence in her sons' lives, ''always in the background, pulling the strings, and pushing the buttons,'' says a friend. ''She did an awesome job, raising three incredibly successful boys, but I think there is a bit of collateral damage.''
If there was, it didn't show in public. In photographs, Buddy Fletcher was almost always smiling, in his bespoke suits and bow ties. As his philanthropy increased, he was more and more often seen at charity black ties, and award dinners. In 2004, he made a splash with his pledge to donate $50 million to people working to promote civil rights, in honor of the 50th anniversary of the Supreme Court's landmark Brown vs. Board of Education decision.
By then his Dakota apartment had become what The New York Times would call ''a salon for wealthy and famous guests'''--including $50,000 ''Fletcher Fellow'' recipients Anita Hill and Anna Deavere Smith. They were popular soir(C)es, often attended by their neighbors in the Dakota, and arranged to perfection by Fowlkes. On a particularly good night Fletcher would lead his guests in singing boisterous renditions of ''Purple Rain'' or ''YMCA'' while he accompanied them on his piano.
But his private life was not so happy. As he become more and more successful, he grew increasingly imperious and difficult to deal with'--more ''Wall Street-y entitled'' in his manner. ''When you have people around you who are afraid to challenge you, and they depend on you for their living and have nothing to say to you except yes, yes, yes, yes, you can lose sight of limits to your behavior, how you treat people,'' says one friend. In 2003, and then again in 2006, two men who worked as caretakers at his Cornwall, Connecticut, home accused him of sexually harassing them. Fletcher denied the allegations, although both men reportedly won confidential settlements.
By the end of 2004, Fletcher's 12-year relationship with Fowlkes was in shambles. Fowlkes went to Rome. When he returned a year later, the relationship was over, although they would remain friends. ''Bo was wonderful, like this character from Henry James,'' says one friend. He was warm and supportive, ''a caretaker personality,'' who had arranged virtually every detail of Buddy Fletcher's life.
Buddy Fletcher met Ellen Pao in Aspen, Colorado, nearly two years after the breakup with Fowlkes, in August 2007. Fletcher and Pao had both been awarded the Aspen Institute's prestigious Henry Crown Fellowships, and met at the institute's weeklong retreat. As some friends saw it, they had a lot in common.
Pao had grown up in New Jersey, one of three daughters of Young-Ping and Tsyh-Wen Pao. Her father was a mathematics professor at New York University. He had died when Ellen was in high school, and it was her mother, an engineer, who had supported the family, sending all three of her three daughters to Ivy League schools. At Princeton, Pao had majored in engineering, with a certificate from the Woodrow Wilson School of Public and International Affairs. She had also been a managing editor at the Daily Princetonian. Most people who worked on the Princetonian ''pretty much bagged their other classes,'' recalls one alumni. ''To do engineering and the Princetonian is hard-core.'' After Princeton, Pao went to Harvard Law School, worked at the law firm of Cravath Swaine & Moore, and then went back to Harvard for business school.
After stints at several tech companies, including Microsoft, BEA Systems, and Tellme Networks, she had started working at Kleiner Perkins in 2005, as John Doerr's chief of staff. It was a prestigious position within a prestigious firm. As his chief of staff, Pao worked very closely with Doerr. ''He was her mentor,'' says a friend. And he trusted her with everything from writing his speeches and articles to his correspondence. He was said to be very fond of her, even if other partners were not. Indeed, it was Doerr who had recommended her as a Crown Fellow.
Quiet, extremely serious, Pao also struck some of Fletcher's friends as ''not very warm,'' ''really intense,'' and ''an achievement machine.'' But those were among the qualities that Buddy ''really dug about Ellen,'' says one. They had hit it off immediately. As Fowlkes recalls, not long after their meeting in Aspen, ''Buddy and I had dinner one night and he told me, 'There is this girl I really like,' and I said, 'Go for it.''' Like many of Fletcher's close friends, Fowlkes wasn't surprised that his former boyfriend had become involved with a woman. At least as far as they knew, he had dated only women at Harvard. As for Pao, who declined to comment for this article, she had been married briefly to her Harvard Business School boyfriend, Roger Kuo, now a San Francisco finance executive. According to friends, she very much wanted to have children, as did Fletcher.
Fletcher and Pao were married in San Francisco in December 2007, four months after they met. That spring, they bought the $3.85 million condo in the San Francisco St. Regis and Fletcher began spending more time on the West Coast. In July 2008, their daughter, Matilda Pao Fletcher, was born. One of Pao's first calls was to Bo Fowlkes to ask him to be the child's godfather. Touched, Fowlkes accepted. ''Ellen could not have been nicer than she's been to me,'' he says.
According to Pao, the trouble at Kleiner Perkins had started on a business trip to Germany in February 2006, almost two years before she met Fletcher. While in Germany, Pao alleges that Ajit Nazre, a married co-worker, who at the time was not senior to her, had made ''inappropriate sexual approaches,'' which she had ''rebuffed.'' But Nazre had refused to take no for an answer, she claimed. On their return to California, he had continued to pressure Pao for sex. He ''falsely told her that his wife had left him'' and ''engaged in offensive, obstructionist, and difficult behavior.'' At some point, Pao ''succumbed'' to Nazre's ''insistence on sexual relations.'' In her lawsuit, she says this happened ''on two or three occasions,'' before she ended their relationship in October. Which is when Nazre, who has since left the firm, began to ''retaliate'' against her. He excluded her from business meetings, removed her from e-mail discussions, and undermined her with colleagues and investment partners'--which he would continue to do for ''more than five years.'' According to Pao's lawsuit, she complained repeatedly to top Kleiner partners over those years, and they retaliated against her because of her complaints'--denying her promotions and lucrative board seats, and, along with other women at the firm, giving her a smaller share of profits than were given to men.
Her first complaint, she says, was made about eight months after she ended her relationship with Nazre. In May 2007, after hearing that several administrative assistants had been ''harassed or discriminated against'' by unnamed Kleiner partners, Pao says she alerted Kleiner's management. An investigator was hired, but when her issues with Nazre were not addressed, she says she complained to two of Kleiner's top partners, Ted Schlein and Ray Lane, and to Juliet de Baubigny, a senior partner in charge of human resources. When she got no response, she says she finally complained to John Doerr'--not only about Nazre but also about ''inappropriate'' behavior by Randy Komisar, a senior partner.
In an eye-popping account, Pao says that on Valentine's Day, in 2007, Komisar gave her Book of Longing, by the Canadian musician, poet, and novelist Leonard Cohen. Pao describes the work as containing ''many sexual drawings and poems with strong sexual content'''--which is true. Critics have called it ''profound,'' as Kleiner noted in court filings, but also ''steamy.'' To wit: ''You came to me this morning/ And you handled me like meat/ You'd have to be a man to know/ How good that feels how sweet.'' According to Pao, Komisar followed this up by asking her out to a Saturday-night dinner, telling her ''that his wife would be out of town.''
Doerr's reaction, according to Pao, was to have another senior partner deal with her complaint. If Pao is to be believed, the conversation was deeply bizarre: instead of taking the complaints about Ajit Nazre's harassment seriously, she says this man encouraged her to marry Nazre. But Kleiner Perkins says that this conversation never occurred. The first and last time that Pao ever mentioned Ajit Nazre, Kleiner says, was shortly after she had broken up with him, and then it was to report that she'd had a relationship with him, and it was over.
As to Komisar and Book of Longing'--which for many women would rank close to the top of the creepy-boss gift list'--Kleiner says that Komisar's wife bought it for Pao. The reason: Pao had given Komisar a Buddha statue as a holiday gift, and he felt obliged to reciprocate, apparently on Valentine's Day. Why that book? According to the firm, Komisar is a Buddhist; he and Pao had discussed Buddhism; Cohen had written the book after a five-year stint at a Buddhist monastery. And John Doerr's reaction to Pao's account of Komisar's alleged steamy come-on? Kleiner Perkins says that Pao never mentioned it to him.
In January 2008, shortly after Pao and Fletcher married, Ajit Nazre was promoted to senior partner'--which now made him Pao's superior. According to Pao, the harassment by Nazre now escalated. She says that John Doerr told her it was because she was ''happy in her recent marriage,'' but that he did nothing to help her. Instead, during the next three years, her lawsuit claims that Kleiner's top management retaliated against her for complaining. They told her to move her office to a ''back annex,'' which she refused to do. They asked her to move to the China office, and she again refused. They withheld her 2008 performance review. And then, while she was out on maternity leave, they named Randy Komisar to the board of RPX, a patent-risk-management company. It was a coveted position she believed should have gone to her, because it was one of the start-ups she'd been nurturing.
It was in April 2010 when Buddy Fletcher asked the Dakota to approve his purchase of Apartment 50. A sprawling two-bedroom, with Central Park views, it adjoined his own 2,600-square-foot three-bedroom. His daughter, Matilda, was almost two years old by then, and he said he wanted to combine the two apartments to make room for his growing family. He asked the board for ''a quick approval'' of his bid. In his application, he offered to liquidate investments in order to pay for the entire $5.7 million transaction in cash. He also offered to pay another $400,000 in cash to cover two years' worth of maintenance on Apartment 50 and his other properties in the building, which included three storage rooms, an apartment he used for staff, and his mother's apartment, which was once Leonard Bernstein's studio.
Fletcher had not expected to have any problems; he not only had lived in the Dakota for 17 years and paid his maintenance promptly, he had been elected to the board eight times and twice served as its president. But on April 28, the Dakota's finance committee rejected his application'--according to the minutes of the meeting, because of ''the risk of the applicant's inability to meet his future financial obligations.'' A week later the full Dakota board ratified that decision.
Fletcher was outraged. This was clear in the bitterness of the lawsuit he would file several months later. Bristling with fury and indignation, it was a catalogue of racial grievances, going back to the day he bought his first apartment at the Dakota in 1992, when he was 26. Ever since that fall, when the board ''with great reluctance'' approved his application to buy a first-floor one-bedroom, he said in his complaint that he been treated ''differently from and less favorably than white shareholders and residents of the Dakota.'' In 1993, when the board approved his purchase of Apartment 52, it had forced him to sell his one-bedroom, even though white residents were allowed to own multiple apartments. The Dakota board said its policy prohibited shareholders from owning nonadjacent apartments with kitchens partly because John Lennon and Yoko Ono had owned so many apartments that residents had gotten upset.
But Fletcher said it was a ''harsh'' condition imposed only on him. According to Fletcher, it was referred to ''mockingly'' by Dakota board members as ''the Buddy rule,'' and it had been used against him again in 2002, when he tried to buy Leonard Bernstein's $1.06 million studio for his mother. The Dakota board would say that they had bent over backward in allowing him to buy it, with the proviso that only his mother be allowed to live there'--again because of the rule against nonadjacent apartments with kitchens. Fletcher, however, claimed that even though he and his mother were both board members, his relatives ''did not feel comfortable staying overnight in the Dakota.''
And, according to Fletcher, he wasn't the only one who was discriminated against. The racism at the Dakota was so rampant that, in 2005, when Melanie Griffith and Antonio Banderas applied to buy a first-floor apartment, they were reportedly turned down because Banderas was Hispanic. Fletcher, who was on the Dakota's board then, alleged that fellow board members made jokes about Banderas's ''desire to have a first-floor apartment so that he could purchase drugs from people on the street.'' Banderas did not respond to requests for comment and the Dakota denied this allegation, saying that it had been ''generally wary'' of celebrity applicants ever since John Lennon was murdered, in 1980, at the Dakota's front entrance.
Fletcher was also on the board when Roberta Flack, ''the only other African American shareholder'' at the Dakota, was allegedly mistreated. The board, he said, rejected the singer's requests for ''much-needed'' renovations to her apartment, forcing her to endure ''the humiliation'' of having to make numerous requests to replace her bathtub. According to the board, Flack, who declined to comment, had wanted to install a whirlpool tub, which is generally not permitted in older New York co-ops with their aging pipes. When she resubmitted her application minus the whirlpool, it was approved.
In Fletcher's account, however, he was the one who resolved Flack's plumbing problem. Elected president of the board for the first time in 2007, he claims he overheard other board members ''whispering and snickering'' about Flack's bathroom applications. He says he put a stop to it'--and to other discriminatory behavior. As Fletcher would say in his lawsuit, ''this is a case about 'pay back.''' Despite his wealth and prominence, he said that he had been denied a fourth apartment in the Dakota not because of any problems with his finances, but because of the Dakota board's ''unlawful scheme to retaliate against Fletcher for having the temerity to stick up for the rights of others.''
In its blistering response, the Dakota would say that Fletcher was turned down entirely for financial reasons. His ''all-cash'' offer was ''illusory'' and would have ''aggravated the perilous illiquidity of his financial condition,'' according to the board's then-president, Bruce Barnes, a private investor who sold his Dakota apartment in January for $29.6 million. The co-op board alleged that F.A.M. had lost money in 2008 and 2009. At the same time, it said, Fletcher was withdrawing money from his company in the form of dividends ''to fund personal expenses'''--to the tune of $6.4 million in 2008 and $5.3 million in 2009'--essentially draining its capital.
Among the many issues the board raised, there was one that might have been an immediate deal-killer even for a co-op board less sophisticated than the Dakota's. And a possible explanation for why the board's finance committee turned his application down so quickly'--in less than a week. As Barnes noted, he discovered shortly after Fletcher first filed his application that ''Duhallow Financial Services,'' listed as the independent auditor of Fletcher's finances, was in fact located in a residential neighborhood in the Bronx, staffed by two former Fletcher employees and run by Denis Kiely, Fletcher's attorney. In the months that followed, Fletcher tried to get the board to reconsider, but after October 2010, he cut off communications.
In August 2010 Ellen Pao received a lukewarm annual performance review from Kleiner's partners. It noted her problems with other partners, and urged her to focus more on her interpersonal skills. She claimed the review was ''spearheaded'' by Randy Komisar, the partner who had given her Book of Longing and snared the RPX board seat. According to Kleiner, Pao had specifically asked to have Komisar on her job-review team.
Whoever is right, by December 2010, Pao had serious problems. According to Pao, members of RPX's board had complained to her about Komisar. She, in turn, relayed those complaints to other top Kleiner partners. If she had hoped this would get her the seat on RPX's board she had so wanted, she was wrong. In January 2011, she was removed from the RPX relationship completely.
''How totally humiliating,'' says one high-ranking woman in Silicon Valley, describing it as a professional slap that would have made anyone angry. Within months, RPX would go public, generating not only millions in profits for Kleiner but also recognition for the Kleiner team that worked with the company. Which Pao missed out on. For Kleiner, Pao's power play against a senior partner appears to have been an example of her problems as a team player. These are referred to in the stinging June 2011 review of her performance that Kleiner submitted to the court, in which Pao was described as ''passive,'' a partner who had a ''sense of entitlement,'' who was ''territorial,'' and was not trusted by others.
But in her lawsuit, Pao alleged that these reviews were part of Kleiner's retaliation against her for complaining about its discrimination against women. In her view, she was removed from the RPX team ''because of her gender.''
Fletcher filed his lawsuit against the Dakota in February 2011, a month after Pao was removed from the RPX account. Friends warned him not to do it. In New York, co-op boards are kingdoms unto themselves'--a powerful city subculture, answerable to almost no one'--that have terrorized and humiliated people far wealthier than Fletcher. Few of them have ever dared to sue. ''I said: Don't. Do. This. Loudly,'' says one friend of Fletcher's. ''I was just like, 'I think this could be really bad, because the Dakota is going to totally come back at you,''' says another friend. ''He seemed very sure. And it's hard to question somebody who seems so completely convinced they are right.'' The blowback was intense.
There was the release of his financial documents, including his banks statements and Social Security number, which had been dumped into the court record, and sent to the press, by the Dakota's board, before a judge ordered the media to destroy them. There was an explosion of media stories about his personal life and finances. The stress of the Dakota fight would get so extreme that, according to Fletcher, he got shingles. Close to tears, Fletcher told the Times in February 2011 that the Dakota's board members were trying to ''defame the things I'm trying to do in the world with my success.''
Five months later, The Wall Street Journal published a devastating article. Although F.A.M. reported $500 million in assets, the newspaper alleged that the company's market investments were less than half that amount, barely $200 million. Basing its conclusions on information gleaned from more than a thousand pages of F.A.M. documents, the Journal said that F.A.M. appeared to have been double counting some of its assets. As the newspaper noted, more than half of its investments were held by three Louisiana public employee pension funds. They had invested $100 million with F.A.M. in 2008. In March 2011, two of the funds had tried to redeem $45 million. Instead of cash, F.A.M. had given them an I.O.U., claiming that their money was invested in assets that weren't liquid at the time. In response, all three pension funds had asked for their entire investment to be returned. In January 2012, after negotiations with Fletcher broke down, the Louisiana funds petitioned the Grand Court of the Cayman Islands to liquidate the F.A.M. funds they'd invested in.
That same month, Kleiner Perkins received a letter from Ellen Pao's lawyer. According to Kleiner, this was the first time that Pao registered any complaint of sexual harassment or discrimination'--which Pao would dispute. Despite her numerous complaints, she alleged, things had not improved for her at the firm. In 2011, for example, she said there were two dinners to which she was not invited, and to which, according to Pao, only male partners and business associates were. At the second one, at the St. Regis, in August'--around the time she received another tepid performance review'--Pao was mortified when she ran into her own clients in the lobby of her building and had to explain that she would not be joining them.
That October, Pao flew to New York with a number of Kleiner partners on partner Ted Schlein's private jet. In her lawsuit, she noted that the men did not include her in any of their business dinners on that trip. And then, in January 2012, around the time her lawyer approached Kleiner, there was an all-male trip to Vail, Colorado, again on a partner's private jet. But the coup de grce seems to have come in March 2012, when three men were promoted to general partner, and Pao was not, although she had been at the firm longer than any of them.
Pao told friends that she did not plan to sue Kleiner Perkins. She says she approached them with her attorney because another woman, a junior partner, had complained about harassment and she wanted the firm to address its problems with women. According to friends, she expected that when Kleiner Perkins heard all her complaints, the firm would rectify the problems, and compensate her'--and that she would go on working happily at the firm. Kleiner did immediately hire an outside investigator, who, the firm says, eventually concluded that Pao's complaints were ''without merit.'' It was at this point, says a friend, that Pao decided she had no option but to sue, which she did, on May 10, a month after Fletcher's F.I.A. Leveraged Fund was ordered liquidated by a Cayman Islands court, and weeks before his main fund filed for bankruptcy in New York.
To many people, there is no question that Pao is telling the truth. The rumor is that she ''has the smoking-gun evidence'''--the e-mails and other documentation that Kleiner alleges she never showed them'--and that those will surface in court. Many in Silicon Valley, especially women, are appalled by what they describe as Kleiner's hardball tactics against a woman they say is ''totally serious'' and ''very professional'''--a woman ''with so much integrity.'' ''Most of us would walk away,'' says Rebecca Eisenberg, a Silicon Valley attorney and former counsel to Reddit, ''but Ellen is taking a stand. The Valley is a very sexist place, and women here put up with it because that's what we have to do to get a piece of the millions that you make here. It's not like Walmart, where, if a woman is discriminated against, it's maybe $20,000 at stake. Here it's $20 million.''
Yet there are also people who doubt Pao'--who see her as an employee who had trouble getting along with her co-workers, who perhaps wasn't as qualified as she thought she was, but who could blame her professional setbacks on gender discrimination.
And in October Pao had a startling setback, when Kleiner Perkins suddenly ended her employment at the firm. Since filing the lawsuit, Pao had gone to work every day, a move that some saw as a particularly courageous refusal to back down, and others as just bizarre, considering how tense the atmosphere there was. But on October 2, Pao herself posted an announcement on Quora, the popular question-and-answer Web site, saying she had been ''terminated.'' While Kleiner would quibble over semantics, saying Pao ''remains an employee'' and that Kleiner was facilitating her ''transition, over an extended period of time, out of the firm,'' Pao stopped coming to work and was eventually replaced on the boards of Kleiner-sponsored start-up companies.
Pao's attorney, Alan Exelrod, says the termination was in ''retaliation'' for her lawsuit. Kleiner attorney Lynn Hermle denies this, suggesting Pao's exit involved job-performance issues. ''A lawsuit cannot be a ticket to lifetime employment,'' says Hermle. ''The firm informed Ellen Pao that it would be separating her employment as the result of long-standing, documented issues and not because of the litigation or because she is a woman. The firm was also generous and fair in its offer to help her transition her career in ways that are inconsistent with retaliatory conduct. They were willing to keep her on the payroll as an employee for six months and to vest in venture funds, and then pay her severance, all without asking her to release her pending legal claims, which is entirely inconsistent with an intent to retaliate.''
At least one friend of Fletcher's says that Fletcher urged his wife not to sue Kleiner. ''Because he was worried about how it would affect her,'' he says. ''It's easy to conclude: he's prone to suing, so he talked her into it. But she was the fallback position, in her good career.'' Last year, the apartment in the San Francisco St. Regis was sold, at a small loss'--just one sign of the pressures the couple now faces. In September, over Fletcher's objections, the New York judge appointed a federal trustee to oversee the bankruptcy of Fletcher's master fund, Fletcher International. In the Cayman Islands, the court-appointed liquidator would note that some $125 million in funds appeared to have vanished. Alleging ''evidence of mismanagement and misconduct,'' he pointed to questionable expenditures by F.A.M., including a nearly $8 million investment by Fletcher in the company that was producing his brother Geoffrey's film directorial-debut, Violet & Daisy, the story of two teenage assassins that is scheduled for release later this year. In December, Fletcher's lawyers in the Dakota suit, among his many creditors, withdrew from the case because they had not been paid in months, although they were soon replaced by other lawyers, including the president of Fletcher's bankrupt hedge fund. Pao is now giving business advice on Quora and is rumored to be trying to raise money for a start-up as she waits for her lawsuit to wind its way through the California courts, either to a settlement or, in a year or so, a very high-profile trial.
'All these years, I really loved Buddy and I thought he was my friend,'' one Dakota resident says. ''We went out to dinner and the theater together. And then all this comes out of the blue. Does he really think that anybody had a problem because he was black? Was he just playing us the whole time?''
There is no question, friends say, that Buddy Fletcher believes with all his heart that he was discriminated against by the Dakota board. ''That is very, very core to this,'' says one friend. ''I have talked to people who say, 'I can't believe he is playing the race card.' I don't think he is playing a card. Buddy is really convinced that it is a bad thing that people have done, to deny him that apartment.'' It is why, friends say, he took the risk of suing the Dakota, something that so few others would dare to try. ''When Buddy believes he's right,'' says one friend, ''he's not just right. It's all about justice.'' His anger, and aggrievement, which stunned some at the Dakota, were not so surprising to those who have known him longer. To them, that Fletcher was one and the same with the friendly, accommodating Buddy Fletcher most people saw. ''If a change,'' says one friend, ''consists of not burying all your frustrations, or feelings of being oppressed, or whatever, and letting those types of things come more to the surface, rather than having a big smile on your face all the time'--I guess that's changing. Or it's just not giving a shit anymore. If it's always there, is it really a change?'' There is the same surprise among some who know her, at the seeming transformation of Ellen Pao'--at the unyielding assertiveness, even aggressiveness, in a woman who had long been regarded as quiet, reserved, a conventional corporate good girl. For Ellen Pao, friends say, as with Buddy Fletcher, it is about justice.
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A woman alleges Brett Kavanaugh held her down and attempted to sexually assault her
Fri, 14 Sep 2018 17:15
A woman alleges Brett Kavanaugh held her down and attempted to sexually assault her
14 de setembro de 2018 15:36
For the past week, rumors have swirled about a secret letter '-- written by a California woman and forwarded to the FBI by Sen. Dianne Feinstein '-- suggesting that Trump Supreme Court nominee Brett Kavanaugh committed some of kind of sexual offense decades ago. The letter was sent to law enforcement rather than made public, according to Feinstein, because the accuser did not want her name to be made public.
But on Friday morning, the New Yorker's Ronan Farrow and Jane Mayer published details of the allegations in the letter. They appear to amount to nothing less than attempted sexual assault. Here are the details, as described by the New Yorker:
The woman, who has asked not to be identified, first approached Democratic lawmakers in July, shortly after Trump nominated Kavanaugh. The allegation dates back to the early nineteen-eighties, when Kavanaugh was a high-school student at Georgetown Preparatory School, in Bethesda, Maryland, and the woman attended a nearby high school. In the letter, the woman alleged that, during an encounter at a party, Kavanaugh held her down, and that he attempted to force himself on her.
She claimed in the letter that Kavanaugh and a classmate of his, both of whom had been drinking, turned up music that was playing in the room to conceal the sound of her protests, and that Kavanaugh covered her mouth with his hand. She was able to free herself. Although the alleged incident took place decades ago and the three individuals involved were minors, the woman said that the memory had been a source of ongoing distress for her, and that she had sought psychological treatment as a result.
Kavanaugh, in a statement to the magazine, claimed this was all made up. ''I categorically and unequivocally deny this allegation,'' he said. ''I did not do this back in high school or at any time.''
Democrats on the Judiciary Committee have tried to focus on issues of sexual harassment and assault by asking what Kavanaugh knew about the accusations against former federal judge Alex Kozinski, for whom Kavanaugh was a clerk. But the letter is a much more direct, and much worse, allegation.
Many believe Kavanaugh, if confirmed, would be the decisive fifth vote for overturning Roe v. Wade. Several moderate female senators who support abortion rights represent key swing votes in the Senate, so Republicans have gone out of their way to downplay the risk to abortion rights posed by the Kavanaugh nomination.
If they find the accusation credible, the idea that a man who is accused of trying to hold someone down and force himself on her would have the power to decide on abortion rights for all American women may prove too much for some of these senators to bear.
Supreme Court nominee Brett Kavanaugh 'categorically' denies claim about alleged behavior in high school
Fri, 14 Sep 2018 15:40
Slideshow by photo services
Supreme Court nominee Brett Kavanaugh vigorously denies claims involving his alleged behavior in high school made in an undisclosed letter and turned over to the FBI by Sen. Dianne Feinstein, D-Calif.
''I categorically and unequivocally deny this allegation. I did not do this back in high school or at any time,'' Kavanaugh said in a statement Friday.
Feinstein on Thursday had thrown a cryptic curveball at Kavanaugh, insinuating the Supreme Court nominee could be guilty of a crime even as Democrats on the Senate Judiciary Committee seek to delay his confirmation.
The vague accusation comes after the committee already grilled Kavanaugh and other witnesses and prepares to vote on sending his nomination to the full Senate. The White House blasted the ambiguous charge as a last minute gambit.
''I have received information from an individual concerning the nomination of Brett Kavanaugh to the Supreme Court,'' Feinstein said in her surprise statement. ''That individual strongly requested confidentiality, declined to come forward or press the matter further, and I have honored that decision. I have, however, referred the matter to federal investigative authorities.''
This is a developing story. Check back for updates.
EU Copyright Directive vote: Articles 11 and 13 approved - The Verge
Fri, 14 Sep 2018 07:18
The European Parliament has voted in favor of the Copyright Directive, a controversial piece of legislation intended to update online copyright laws for the internet age.
The directive was originally rejected by MEPs in July following criticism of two key provisions: Articles 11 and 13, dubbed the ''link tax'' and ''upload filter'' by critics. However, in parliament this morning, an updated version of the directive was approved, along with amended versions of Articles 11 and 13. The final vote was 438 in favor and 226 against.
The fight is far from finished
The fallout from this decision will be far-reaching, and take a long time to settle. The directive itself still faces a final vote in January 2019 (although experts say it's unlikely it will be rejected). After that it will need to be implemented by individual EU member states, who could very well vary significantly in how they choose to interpret the directive's text.
The most important parts of this are Articles 11 and 13. Article 11 is intended to give publishers and papers a way to make money when companies like Google link to their stories, allowing them to demand paid licenses. Article 13 requires certain platforms like YouTube and Facebook stop users sharing unlicensed copyrighted material.
Critics of the Copyright Directive say these provisions are disastrous. In the case of Article 11, they note that attempts to ''tax'' platforms like Google News for sharing articles have repeatedly failed, and that the system would be ripe to abuse by copyright trolls.
Article 13, they say, is even worse. The legislation requires that platforms proactively work with rightsholders to stop users uploading copyrighted content. The only way to do so would be to scan all data being uploaded to sites like YouTube and Facebook. This would create an incredible burden for small platforms, and could be used as a mechanism for widespread censorship. This is why figures like Wikipedia founder Jimmy Wales and World Wide Web inventor Tim Berners-Lee came out so strongly against the directive.
The Copyright Directive is set to reshape the internet globally
However, those backing these provisions say the arguments above are the result of scaremongering by big US tech companies, eager to keep control of the web's biggest platforms. They point to existing laws and amendments to the directive as proof it won't be abused in this way. These include exemptions for sites like GitHub and Wikipedia from Article 13, and exceptions to the ''link tax'' that allow for the sharing of mere hyperlinks and ''individual words'' describing articles without constraint.
In remarks following the vote in Parliament this morning, MEP Axel Voss, who has led the charge on Articles 11 and 13, thanked his fellow politicians ''for the job we have done together.'' ''This is a good sign for the creative industries in Europe,'' said Voss. Opposing MEPs like Julia Reda of the Pirate Party described the outcome as ''catastrophic.''
Despite these disagreements, what's clear is that if the Copyright Directive receives final approval by the European Parliament in January, it will have a huge, disruptive impact on the internet, both in the European Union and around the world. Exactly how the legislation will be interpreted will be up to individual nations, but the shift in the balance of power is clear: the web's biggest tech companies are losing their grip on the internet.
San Francisco Is Removing Statue That Shows Founding Of California Over Racism Concerns | The Daily Caller
Fri, 14 Sep 2018 06:03
The San Francisco Board of Appeals unanimously voted Wednesday to remove a statue that showed the founding of California over racism concerns.
Some American Indian activists found the ''Early Days'' statue degrading and racist as it showed an American Indian at the feet of a Spanish cowboy and a Catholic missionary. American Indian groups have tried to remove the statue for over 30 years, but efforts were renewed by the San Francisco Arts Commission in October 2017 following the clash in Charlottesville, Virginia over removing Confederate statues the previous August, according to the San Francisco Chronicle Wednesday.
San Francisco's Historic Preservation Commission was on board to remove the statue in February as long as a plaque was placed that explained the reason for the removal, KQED reported.
The appeals board decided not to remove the statue in April. Board member Rick Swig said removing it would impede free speech, according to East Bay Times.
The statue is one of five bronze statues that make up the Pioneer Monument and shows the founding of California, the Chronicle reported. The five-member board decided to look into the issue again in June. (RELATED: UNC Student Smears Confederate Statue With Ink And Allegedly Her Own Blood [VIDEO])
San Francisco Arts Commission spokeswoman Kate Patterson didn't give the exact date of the statue's removal due to security reasons, according to East Bay Times.
''The San Francisco Arts Commission can now move forward with the removal of this racist and disrespectful sculpture, which has no place in our city,'' Patterson said in a statement to The Daily Caller News Foundation. ''Following its removal, the sculpture will be placed in storage, and a didactic plaque will be erected near the monument explaining the rationale for the sculpture's removal.''
A Mahatma Gandhi statue still stands at the San Francisco Ferry Building, though protesters from Organizations for Minorities of India wanted the statue taken down and replaced with either Martin Luther King Jr. or low-caste Dalit leader B.R. Ambedkar in 2010, SFGate reported Oct. 2, 2010. The organization focuses on bringing attention to the oppression those lowest in the Hindu caste system.
''The popular image of Gandhi as an egalitarian pacifist is a myth,'' Bhajan Singh, one of the organizers, said in a statement, according to SFGate. ''We plan to challenge that myth by disseminating Gandhi's own words to expose his racism and sham nonviolence.''
Gandhi wrote in a 1893 letter to the Natal parliament that the Indians in the colonies thought that they were better than the ''savages or the Natives of Africa,'' BBC reported on Sept. 17, 2015.
Arts Commission President P.J. Johnston said at the time that the Gandhi statue was likely not coming down, SFGate reported.
The board did not immediately respond to TheDCNF's request for comment.
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Fox News' Tucker Carlson uses 'creepy porn lawyer' tag during Avenatti interview | TheHill
Fri, 14 Sep 2018 05:05
Fox News referred to Stormy Daniels's attorney Michael Avenatti as a "creepy porn lawyer" in a series of on-screen graphics Thursday night during his appearance on Tucker Carlson's show.
The lower-third chyrons on "Tucker Carlson Tonight" came as the host asked Avenatti in the heated interview about the adult-film actress's lawsuit against President Trump Donald John TrumpPoll: Democrat McCaskill leads Republican Hawley by 3 points in Missouri Senate race Pence cancels trip to Georgia after Hurricane Florence path changes Trump's school safety commission will not support age limits for gun purchases: report MORE and the president's former lawyer, Michael Cohen.
On-screen labels that were featured during the interview with Avenatti included "Creepy Porn Lawyer Toying with 2020 run" and "Does American Want Creepy Porn Lawyer as Pres?"
Carlson, an opinion host on the network, has previously referred to Avenatti as "the creepy porn lawyer." He renewed the tag for his interview to discuss Daniels's lawsuit over a nondisclosure agreement that was used to keep her quiet about an alleged affair with Trump in 2006.
Some of the actual chyrons @FoxNews has run while @MichaelAvenatti has been on @TuckerCarlson's program:*CREEPY PORN LAWYER TOYING WITH 2020 RUN
*DOES AMERICA WANT CREEPY PORN LAWYER AS PRES?
*STORMY'S LAWYER AS CREEPY PORN PRESIDENT?
'-- Oliver Darcy (@oliverdarcy) September 14, 2018Tucker: "let me take you seriously as someone who wants to be involved in the public conversation''Literally less than 10 seconds later the chyron: pic.twitter.com/rnAnQb0F7m
'-- Salvador Hernandez (@SalHernandez) September 14, 2018i don't know why anybody would agree to do an interview with an interviewer who smears you like this pic.twitter.com/Cyw94vlZIb
'-- Aaron Rupar (@atrupar) September 14, 2018''Creepy porn lawyer, great to see you,'' Carlson said as the segment came to a close.
Avenatti slammed Carlson over the on-screen graphics minutes after finishing his appearance on the show.
"After he told me that he was not going to engage in 'name calling.' This is why so many people correctly conclude that @TuckerCarlson is a liar, just like Trump," Avenatti tweeted.
Yes. After he told me that he was not going to engage in ''name calling.'' This is why so many people correctly conclude that @TuckerCarlson is a liar, just like Trump. https://t.co/y7ly56tIWy
'-- Michael Avenatti (@MichaelAvenatti) September 14, 2018Avenatti's appearance on Carlson's show also comes as he receives more attention surrounding a potential 2020 Democratic presidential bid to challenge Trump.
When Carlson questioned Avenatti about the topic Thursday night, the lawyer noted that the host had asked for him to come on the show to discuss Daniels's case against Trump.
Letitia James wins New York attorney general primary - Vox
Fri, 14 Sep 2018 05:02
Letitia James, New York City's public advocate, won the Democratic primary for New York State attorney general, and could become the first African-American woman to hold statewide office in New York.
James defeated US Rep. Sean Maloney, attorney Zephyr Teachout, and Leecia Eve, a Verizon executive with past government experience.
James won the backing of the state Democratic Party and Gov. Andrew Cuomo's endorsement, which gave her a boost of name recognition and clout outside of New York City, where she's served as the public advocate since 2014 and previously served as a City Council member.
James had jumped out as the frontrunner for the attorney general job soon after Eric Schneiderman resigned amid assault allegations. But as insurgent progressive campaigns started to get attention in New York and elsewhere, James's Democratic Party backing turned her into the establishment figure in the race. She bristled at the label; as she told New York magazine, ''In May, I was the progressive darling, and now I am the Establishment.''
Whether voters decided she is the progressive darling again '-- or they didn't mind her establishment ties '-- James overcame any questions to secure the Democratic nomination on Thursday.
Like her three defeated primary opponents, James vowed she would take on corruption in Albany, the state capital '-- and Donald Trump.
The state Attorney General's Office sued Trump University under the leadership of Schneiderman, and his temporary successor, Barbara Underwood, brought a lawsuit against Trump's family charity. The office is reportedly investigating Michael Cohen's taxes, too. All that doesn't include, as of August, about 150 legal actions against the Trump administration.
James will face GOP candidate Keith Wofford in November, an attorney originally from Buffalo, New York, who is the first African-American Republican candidate for attorney general. Wofford has also vowed to clean up corruption in Albany, and he's pointed out the many Democratic attorney generals who've failed to do so in years past. Wofford has been cagey so far about investigating Trump; he's said he'll focus on bringing suits that benefit the interests of New York, not on trying to score political points.
James and Wofford will have made history with their campaigns no matter what. It's just up to New York voters who they want to be fighting corruption in Albany '-- and Washington.
PixelCommunity comments on is anyone else's power saving mode turning itself on even though you have it off?
Fri, 14 Sep 2018 04:58
Doesn't Google Play Services update in the background without warning? There's never a update notification for it but it still gets updated somehow. I found this information online for Google Play Services and it sounds like it could have the power to control something like battery saver.
"Google Play Services is used by almost all Google apps and has system-level powers to provide multiple internal features. All major Android services are controlled by Google Play Services. Without this, Apps may not work properly."
"Google Play Services is automatically updated through Google Play on devices running Android 4.0 or newer. This means Google can do fast, silent rollouts of updates, providing new functionality to older devices without manufacturers having to update the Android firmware itself, working around the fragmentation of the platform for which it had become infamous."
There's also a Google Play Services Beta program, so maybe they accidentally rolled out a experiment they wanted test on beta users, to everyone. I still would like Google to explain more but I just wanted to share my thoughts on the subject.
Live updates after gas explosions rock Lawrence, Andover, North Andover | Boston.com
Fri, 14 Sep 2018 04:49
Follow updates from Lawrence, Andover, North Andover, and state officials below.By
John Wallerupdated at 12:09 AM
Read more: 18-year-old killed as gas explosions and fires destroy homes in Lawrence, Andover, and North AndoverA Twitter List by jd_waller
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18-year-old killed as gas explosions and fires destroy homes in Lawrence, Andover, and North Andover September 13, 2018 | 11:30 PM Local
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Dalai Lama says 'Europe belongs to Europeans', Government & Economy - THE BUSINESS TIMES
Fri, 14 Sep 2018 04:48
Thu, Sep 13, 2018 - 12:07 AM
[STOCKHOLM] The Tibetan spiritual leader, the Dalai Lama, said Wednesday that "Europe belongs to the Europeans" and that refugees should return to their native countries to rebuild them.
Speaking at a conference in Sweden's third-largest city of Malmo, home to a large immigrant population, the Dalai Lama - who won the Nobel Peace Prize in 1989 - said Europe was "morally responsible" for helping "a refugee really facing danger against their life".
"Receive them, help them, educate them... but ultimately they should develop their own country," said the 83-year-old Tibetan who fled the capital Lhasa in fear of his life after China poured troops into the region to crush an uprising.
"I think Europe belongs to the Europeans," he said, adding they should make clear to refugees that "they ultimately should rebuild their own country".
Revered by millions of Buddhists around the world, and regarded by his many supporters as a visionary in the vein of Mahatma Gandhi and Martin Luther King, the Dalai Lama was speaking three days after the far-right populist party Sweden Democrats made gains in the country's general election on Sunday.
The anti-immigration party came in third, behind Prime Minister Stefan Lofven's Social Democrats and the opposition conservative Moderates in the Nordic nation which in 2015 took in the highest number of asylum seekers per capita in Europe.
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Opinion | Michael Avenatti: The Case for Indicting the President - The New York Times
Fri, 14 Sep 2018 04:25
Justice Department lawyers have said a sitting president cannot be indicted. It's time to test that proposition by bringing an indictment that can be reviewed by the Supreme Court.
By Michael Avenatti
Mr. Avenatti is the lawyer for Stormy Daniels in her lawsuits against President Trump and his former personal lawyer, Michael Cohen.
Sept. 13, 2018 Image Credit Credit Illustration by Jeffrey Henson Scales, photographs by Darrin Klimek/Digital Vision and Sirichoke/iStock, via Getty Images Sol Wachtler, a former chief judge of the New York State Court of Appeals, once famously remarked that grand juries were so easily swayed that they would ''indict a ham sandwich'' if a prosecutor requested it. Many times, there is truth to this. But an indictment does not end the process of determining guilt or innocence. It begins it.
Following indictment, criminal defendants can question the validity of the charges, the methods used to acquire the evidence and the evidence itself. They can seek to dismiss a criminal indictment and, if unsatisfied with the ruling, appeal it all the way to the Supreme Court.
The grand jury system has been employed in hundreds of thousands of cases involving all manner of crimes committed by all manner of people. All, that is, except one: the president.
No grand jury has ever indicted a president, and consequently no court, let alone the Supreme Court, has ruled on the critical question of whether the Constitution allows a president to be indicted while in office. Legal scholars have opined on both sides of the issue, and Department of Justice attorneys have drafted memorandums arguing against indicting a sitting president. But none of these analyses establish definitive rules of law. It is time to clarify the issue.
Provided there is sufficient evidence to support an indictment of President Trump '-- and there are many indications that there is '-- the special counsel, Robert Mueller, who is investigating possible Russian interference in the 2016 election, and prosecutors from the United States Attorney's Office for the Southern District of New York, who are investigating payments to my client, Stormy Daniels, and Karen McDougal, should present their evidence to grand juries. Those jurors, citizens of our communities, should then determine whether the evidence supports an indictment of Mr. Trump.
The fact that Mr. Trump is a sitting president should not derail a process that applies to all Americans, regardless of stature or station. He would still have the post-indictment relief available to all citizens, including the ability to challenge the constitutionality of the indictment. Some also argue that indicting the president would critically impair his ability to lead the country. But this is a White House already engulfed in chaos and daily distractions. And if the House were to initiate impeachment proceedings, it is hard to see how that process would be any less distracting than a criminal indictment.
Support for indicting a sitting president can be found in the Supreme Court's 1997 unanimous decision in Clinton v. Jones, holding that a sitting president has no immunity from civil litigation in federal court from acts done before taking office and unrelated to duties as president. That decision later famously led to President Bill Clinton's sworn deposition testimony, which in turn served as the basis for impeachment charges.
On the other side of the argument, Assistant Attorney General Randolph D. Moss wrote a memorandum opinion in 2000 analyzing the constitutionality of indicting a sitting president. This followed a 1973 analysis by Assistant Attorney General Robert G. Dixon Jr. that examined the same issue in connection with the Watergate scandal. Both concluded that the Constitution makes a sitting president immune from indictment.
But other constitutional scholars have reached the opposite conclusion. Ronald Rotunda, who was part of the Watergate investigative team and served as an adviser to Kenneth Starr when he was the independent counsel investigating President Clinton, concluded in 1998: ''It is proper, constitutional and legal for a federal grand jury to indict a sitting president for serious criminal acts that are not part of, and are contrary to, the president's official duties. In this country, no one, even President Clinton, is above the law.'' Mr. Starr himself said this week that he believes the Constitution allows for the indictment of a sitting president.
But however well intentioned and instructive those memorandums and analyses might be, they do not begin to approach the weight of an actual Supreme Court decision. Our democracy and our belief in the rule of law for all, including presidents, should not rest on such a soft foundation.
Instead, if the facts and evidence are adequate for indictment, then prosecutors must be blind to the officeholder's position '-- especially so in this case because, unlike in President Clinton's case, the investigations relate to how Mr. Trump won the election. Ultimately, the question would almost certainly be decided by a panel of judges previously confirmed pursuant to the Constitution '-- either in the courts of appeals or, more appropriately, the Supreme Court.
Which brings us to the question of who on the Supreme Court should be allowed to review an indictment against the president. Last week, during his confirmation hearing, Judge Brett Kavanaugh refused to commit to recusing himself in the event he was confirmed and a case involving the investigation of Mr. Trump were to reach the Supreme Court. He took this position despite the fact that his strong views in favor of presidential immunity are outside the legal mainstream and he was chosen by Mr. Trump during known inquiries into the conduct of the president and his campaign. This is wrong.
Should Mr. Trump be indicted and in the event that the case reaches the Supreme Court, Judge Kavanaugh's recusal should be mandatory. The American public's view of impartiality of the rule of law and of the Supreme Court hangs in the balance.
Michael Avenatti is the lawyer for Stephanie Clifford, also known as Stormy Daniels, in her lawsuits against President Trump and his former personal lawyer, Michael Cohen.
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Andrew Cuomo Is America's Problem Now
Fri, 14 Sep 2018 04:08
In one of the most predictable outcomes yet this election cycle, New York Gov. Andrew Cuomo won his Thursday primary against actress and leftist Democrat Cynthia Nixon. It took all of half an hour after the polls closed for the AP to call the race, in a result that centrist Democrats and liberals who prioritize experience will find a relief. But it is also a loss for America as a whole, because with Cuomo's nomination comes his virtually certain re-election, which in turn gives him a platform to run for President in 2020'--about the last thing the country needs right now.
Yes, Cuomo said in his one debate that ''my only caveat is if God strikes me dead. Otherwise, I will serve four years as governor of the state of New York." If you buy that, I've got a bridge with his family name to sell you.
Approaching two years into Donald Trump's presidency, with Hillary Clinton (a converted New Yorker), Rudy Giuliani, the whole Trump clan, former White House Communications Director Anthony Scaramucci, new Congressional star even before arriving in office Alexandria Ocasio-Cortez, New York born-and-bred Sen. Bernie Sanders, New York Mayor Bill De Blasio, New York Sens Kirsten Gillibrand and Chuck Schumer all prominently on the scene, the country is at risk of New York burnout.
Some of us would already like a moratorium on New Yorkers getting anywhere near the White House. But Cuomo's last name and obvious political ambition mean that a third term will likely subject American to still more of the Empire State's worst'--from both sides of the aisle.
While no Republican, and relatively few Democrats for that matter, actually wanted Nixon as governor'--she's a quasi-Democratic Socialist like Ocasio-Cortez with a weak grasp of policy and zero experience relevant to running a big and complex state'--Cuomo in many ways is more worthy of contempt.
Sure, Cuomo has managed two Bs, and one D, on his three CATO Fiscal Report Cards since being elected, so he's not as liberal on fiscal policy as, say, Hawaii's governors (a low bar to clear).
But he's worse than a standard-issue swamp liberal where Second Amendment rights are concerned. Cuomo's NY Safe Act arguably was so gun-grabby that as originally written, it arguably criminalized police officers. Cuomo's Department of Financial Services (DFS) is currently locked in litigation with the National Rifle Association'--which is being backed up by the American Civil Liberties Union'--because New York's DFS is trying to bully financial institutions into denying the NRA access to the banking system. Cuomo has personally used his bully pulpit (pun fully intended) to coerce financial institutions into severing ties with the NRA'--a hardcore activist lefty move, but also a very, very shady and almost certainly unconstitutional one.
He has also embraced teachers' unions, reversing himself after previously pledging to combat their nefarious influence fighting charter schools and teacher evaluations. This, in a state whose those same unions created ''Rubber Rooms'' to keep the checks coming to teachers who hadwith no business working in a classroom and where major educational challenges exacerbated by teachers' unions were exposed in ''Waiting for Superman.''
More, Cuomo cuts an extremely ethically-challenged and frankly thuggish profile, which unhelpfully dovetails with stereotypes of New Yorkers enhanced by our current President.
Set aside the last-minute, pre-election shadiness of his party apparatus issuing a mailer tagging Nixon as an anti-Semite that his operation first denied any role in only for it to emerge that one of his former most senior government aides had in fact approved it, while ''volunteering'' for his campaign. Set aside his last-minute, pre-election ''opening'' of a bridge that didn't really open, despite a ceremony just ahead of the primary with Hillary Clinton, with with how the old bridge it was replacing was at risk of falling into the new bridge it turns out.
Focus on his administration's illegal pay-to-play schemes. Former Cuomo aide and associate Joe Percoco'--who Cuomo had referred to as his ''brother'''-- was convicted on bribery charges. Alain Kaloyeros, the chief architect of Cuomo's signature Buffalo Billion economic development program for western and upstate New York, was also convicted of corruption. Cuomo reportedly violated an executive order prohibiting pay-to-play in state government appointments that he himself signed into law, via a creative ''reinterpretation'' of it.
Cuomo was also tagged by the New York Times '-- in its teeth-gritted endorsement of him! '-- for his ''deeply compromised'' decision to ''abruptly disband'' a panel designed to ''root out corruption in state politics.'' Cuomo and his aides have also been called out for advocating for automatic deletion of their email records after 3 months, trying to rig questions from reporters during media calls, restricting the release of information by state agencies and deploying staff to ''screen records that reporters requested from the State Archives.''
Cuomo was even attacked by the son of a gubernatorial rival for a Cuomo-affiliated party organization doctoring that rival's family photos for use in an attack ad that implied the rival was a Miami Dolphins fan (a bad thing to be, in and around Buffalo).
Also like the President, fellow son of Queens Cuomo manages to sound negative and dark about America at a time when many voters are desperate to hear something uplifting and positive. Compare and contrast Trump's pre-2016 ''Crippled America'' book title and Cuomo's recent comment that America ''was never that great.''
In previous election cycles, political consultants and pundits have joked among ourselves that there ought to be an amendment to the Constitution banning anyone from Massachusetts or Texas from ever running for President. Yet both states have elected figures who are far more acceptable as presidential material than what New York seems capable of delivering lately.
As unlikable and unacceptable as Sen. Elizabeth Warren and Rep. Beto O'Rourke are to Republicans and many Independents, if either or both enters the 2020 fray, perhaps they can at least put the kibosh on any potential for Cuomo to successfully run for the Democratic nomination. No one needs a redux of 2016, and a second national trip to the ballot box where we're give a choice between two ethically-challenged, painful-to-listen-to, make-you-tear-your-hair-out candidates from New York. America deserves better than Andrew Cuomo.
Scientists say 25 years left to fight climate change | Public Radio International
Fri, 14 Sep 2018 04:06
You can think of global warming kind of like popping a bag of popcorn in the microwave.
Anthropogenic, or human-caused, warming has been stoked by increasing amounts of heat-trapping pollution since the start of the industrial age more than 200 years ago. But that first hundred years or so was kind of like the first minute for that popcorn '-- no real sign of much happening.
But then you get to that second minute, and the kernels really start doing their thing. And you can think of all those individual pops as extreme weather events '-- superstorms, extreme downpours, high-tide flooding, droughts, melting glaciers, ferocious wildfires. They're like the signals that the climate is changing.
And in popcorn terms, ''we are in that second minute,'' says Inez Fung, an atmospheric scientist at UC Berkeley '-- in the throes of a problem we can now see unfolding all around us.
"Thirty years ago we predicted it in the models, and now I'm experiencing it,'' Fung says. ''You see the fires in the western US and British Columbia. And then at the same time, we've got fires, it rained three feet in Hilo, Hawaii, from [a] hurricane '-- that is a new record at the same time that we have droughts and fires, over 300 people died in India from floods. We are not prepared. "
Across the US the average temperature has risen almost two degrees Fahrenheit since the start of the 20th century. And that's only the beginning, says Bill Collin, who directs climate and ecological science at Lawrence Berkeley National Lab.
"We released enough carbon dioxide to continue warming the climate for several centuries to come," Collins says.
And he says that means a certain amount of future warming is already "baked in, if you will."
In other words, going back to that popcorn metaphor, even if you hit the stop button on the oven, some of those kernels will keep popping.
"If we were to stop emissions entirely of all greenhouse gases right this minute," Collins says, "we'd see roughly another half a degree centigrade by the end of the 21st century."
That's almost a full degree Fahrenheit already in the pipeline. So even if we shut down all emissions '-- which is not happening '-- we might still get to the threshold of two degrees Celsius, or 3.5 degrees Fahrenheit, warming from pre-industrial levels, at which point many scientists say the worst effects of climate change would kick in.
"We're seeing years now that basically blow the roof off of records back to the late 19th century," notes Collins '-- and then a remarkable thought occurs to him:
"None of the students in my classes have grown up in a normal climate. None of them."
On the flipside, if you're over, say 30, and can actually recall ''normal," well, that's over.
"I have to say that all the projections that were made 30 years ago are still valid," says Fung. "The only thing we had not anticipated ... is that the CO2 increases much faster than we ever thought that it would."
Despite the pledges made in Paris by nearly every nation in the world (the US under the Trump administration is alone among signatories in backing out of the climate accord), emissions are still rising. And even those historic commitments '-- if they're all kept '-- won't be enough to turn things around.
"No, we're already beyond that," says Fung. "The commitments, I think, are a very good start, but they're just not adequate."
All this grim talk might lead one to ask what point there is in trying to reverse the climate train.
But recently refined climate models suggest that aggressively cutting emissions could at least blunt the impact of continued warming. It could, for example, reduce periods of extreme heat in California's capital Sacramento from two weeks a year to as little as two days. The snowpack in the state's Sierra Nevada mountains might shrink by ''just'' 20 percent, rather than 75 percent.
That's the optimistic scenario.
The Global Climate Action Summit being held his week in San Francisco will pull together mayors, state and provincial governors, scientists and corporate leaders from around the world and the US to try to keep momentum going with what are known as "subnational" actions to reduce greenhouse gas emissions '-- things done at the local, state and regional level.
They'll be joined by major players such as California governor Jerry Brown, who organized the conference and has helped position the state as a global leader in the fight to step climate change; former Vice President Al Gore; and former Secretary of State John Kerry, who signed the Paris accord on behalf of the US with his tiny granddaughter perched on his lap.
One of the themes attendees will discuss is "key building blocks required to peak global emissions by 2020," a goal that seems wildly optimistic given current emissions trajectories, and with barely more than two years to go.
"First thing we have to do as a global community is reverse course rather sharply," says Collins. "We think it is technically feasible."
Technically feasible, perhaps, but not easy. California, for instance, has the most aggressive efforts to cut greenhouse gases in the US and overall, it's working '-- total emissions are down 13 percent since 2004. Still, climate emissions from cars and trucks are on the rise.
"Our cars are literally our time machines," Collins says. And they're taking us backward.
"They're taking the atmosphere to a chemical state that it has not been in for millions of years," he says. "Currently, we have as much carbon dioxide in the Earth's atmosphere as we did five million years ago."
And that was a very different world, long before humans ever showed up.
In the space of a little over 230 years since the start of industrialization, Collins says "our steam engines, our factories, our cars '... they've taken us back five million years."
And Collins says we have about 25 years '-- roughly one generation '-- to reverse course.
Collins and Fung both have their glimmers of optimism that technology and the boom in solar, wind and other forms of clean energy could quickly reduce climate emissions. Fung also points to the young college students passing by us on the Berkeley campus as her best hope.
"I am optimistic about the young people,'' she says. ''I'm optimistic that they are '... very proactive about the future."
But she and Collins agree that what's running out is time.
Yale Law Journal - Amazon's Antitrust Paradox
Fri, 14 Sep 2018 04:04
abstract. Amazon is the titan of twenty-firstcentury commerce. In addition to being a retailer, it is now a marketingplatform, a delivery and logistics network, a payment service, a credit lender,an auction house, a major book publisher, a producer of television and films, afashion designer, a hardware manufacturer, and a leading host of cloud serverspace. Although Amazon has clocked staggering growth, it generates meagerprofits, choosing to price below-cost and expand widely instead. Through thisstrategy, the company has positioned itself at the center of e-commerce and nowserves as essential infrastructure for a host of other businesses that depend uponit. Elements of the firm's structure and conduct pose anticompetitiveconcerns'--yet it has escaped antitrust scrutiny.
ThisNote argues that the current framework in antitrust'--specifically its pegging competition to ''consumer welfare,'' defined asshort-term price effects'--is unequipped to capture the architecture of marketpower in the modern economy. We cannot cognize the potential harms tocompetition posed by Amazon's dominance if we measure competition primarilythrough price and output. Specifically, current doctrine underappreciates therisk of predatory pricing and how integration across distinct business linesmay prove anticompetitive. These concerns are heightened in the context ofonline platforms for two reasons. First, the economics of platform markets createincentives for a company to pursue growth over profits, a strategy thatinvestors have rewarded. Under these conditions, predatory pricing becomeshighly rational'--even as existing doctrine treats it as irrational and thereforeimplausible. Second, because online platforms serve as critical intermediaries,integrating across business lines positions these platforms to control theessential infrastructure on which their rivals depend. This dual role alsoenables a platform to exploit information collected on companies using itsservices to undermine them as competitors.
ThisNote maps out facets of Amazon's dominance. Doing so enables us to make senseof its business strategy, illuminates anticompetitive aspects of Amazon'sstructure and conduct, and underscores deficiencies in current doctrine. TheNote closes by considering two potential regimes for addressing Amazon's power:restoring traditional antitrust and competition policy principles or applyingcommon carrier obligations and duties.
author. I am deeply grateful to David SinghGrewal for encouraging me to pursue this project and to Barry C. Lynn for introducingme to these issues in the first place. For thoughtful feedback at variousstages of this project, I am also grateful to Christopher R. Leslie, Daniel Markovits , Stacy Mitchell, Frank Pasquale, George Priest,Maurice Stucke , and Sandeep Vaheesan .Lastly, many thanks to Juliana Brint , Urja Mittal, and the YaleLaw Journal staff for insightful comments and careful editing. All errorsare my own.
Introduction''Evenas Amazon became one of the largest retailers in the country, it never seemedinterested in charging enough to make a profit. Customers celebrated and thecompetition languished.''
'-- The NewYork Times 1
''[O]ne of Mr. Rockefeller's most impressivecharacteristics is patience.''
'-- Ida Tarbell , A History of the Standard Oil Company 2
In Amazon's early years, a running joke among Wall Streetanalysts was that CEO Jeff Bezos was building a house of cards. Entering itssixth year in 2000, the company had yet to crack a profit and was mountingmillions of dollars in continuous losses, eachquarter's larger than the last. Nevertheless, a segment of shareholdersbelieved that by dumping money into advertising and steep discounts, Amazon wasmaking a sound investment that would yield returns once e-commerce took off.Each quarter the company would report losses, and its stock price would rise.One news site captured the split sentiment by asking, ''Amazon: Ponzi Scheme or Wal-Mart of the Web?''3
Sixteen years on, nobody seriously doubts that Amazon isanything but the titan of twenty-firstcenturycommerce. In 2015, it earned $107 billion in revenue,4 and, as of 2013, it soldmore than its next twelve online competitors combined.5 By some estimates, Amazonnow captures 46% of online shopping, with its share growing faster than thesector as a whole.6 In addition to being a retailer, itis a marketing platform, a delivery and logistics network, a payment service, acredit lender, an auction house, a major book publisher, a producer oftelevision and films, a fashion designer, a hardware manufacturer, and a leadingprovider of cloud server space and computing power. Although Amazon has clockedstaggering growth'--reporting double-digit increases in net sales yearly'--itreports meager profits, choosing to invest aggressively instead. The companylisted consistent losses for the first seven years it was in business, withdebts of $2 billion.7While it exits the red more regularly now,8 negative returns are stillcommon. The company reported losses in two of the last five years, for example,and its highest yearly net income was still less than 1% of its net sales.9
Despite the company's history of thin returns, investors havezealously backed it: Amazon's shares trade at over 900 times diluted earnings, making it the most expensive stock in the Standard &Poor's 500.10 As one reporter marveled, ''The company barely ekes out a profit, spends a fortune onexpansion and free shipping and is famously opaque about its businessoperations. Yet investors . . . pourinto the stock.''11 Another commented thatAmazon is in ''a class of its own when it comes to valuation.''12
Reporters and financial analysts continue to speculate aboutwhen and how Amazon's deep investments and steep losses will pay off.13 Customers, meanwhile, universallyseem to love the company. Close to half of all online buyers go directly toAmazon first to search for products,14 and in 2016, the ReputationInstitute named the firm the ''most reputable company in America'' for the thirdyear running.15 In recent years,journalists have exposed the aggressive business tactics Amazon employs. Forinstance Amazon named one campaign ''The Gazelle Project,'' a strategy wherebyAmazon would approach small publishers ''the way a cheetah would a sicklygazelle.''16 This, as well as other reporting,17 drew widespread attention,18 perhaps because it offereda glimpse at the potential social costs of Amazon's dominance. The firm'shighly public dispute with Hachette in 2014'--in which Amazon delisted thepublisher's books from its website during business negotiations'--similarlygenerated extensive press scrutiny and dialogue.19 More generally, there isgrowing public awareness that Amazon has established itself as an essentialpart of the internet economy,20 and a gnawing sensethat its dominance'--its sheer scale and breadth'--may pose hazards.21 But when pressed on why,critics often fumble to explain how a company that has so clearly deliveredenormous benefits to consumers'--not to mention revolutionized e-commerce ingeneral'--could, at the end of the day, threaten our markets. Trying to makesense of the contradiction, one journalist noted that the critics' argumentseems to be that ''even though Amazon's activities tend to reduce book prices, which is considered good for consumers, theyultimately hurt consumers.''22
In some ways, the story of Amazon's sustained and growingdominance is also the story of changes in our antitrust laws. Due to a changein legal thinking and practice in the 1970s and 1980s, antitrust law nowassesses competition largely with an eye to the short-term interests ofconsumers, not producers or the health of the market as a whole; antitrust doctrineviews low consumer prices, alone, to be evidence of sound competition. By thismeasure, Amazon has excelled; it has evaded government scrutiny in part throughfervently devoting its business strategy and rhetoric to reducing prices forconsumers. Amazon's closest encounter with antitrust authorities was when theJustice Department sued other companies for teaming up against Amazon.23 It is as if Bezos chartedthe company's growth by first drawing a map of antitrust laws, and thendevising routes to smoothly bypass them. With its missionary zeal forconsumers, Amazon has marched toward monopoly by singing the tune of contemporaryantitrust.
This Note maps out facets of Amazon's power. In particular,it traces the sources of Amazon's growth and analyzes the potential effects ofits dominance. Doing so enables us to make sense of the company's business strategyand illuminates anticompetitive aspects of its structure and conduct. Thisanalysis reveals that the current framework in antitrust'--specifically itsequating competition with ''consumer welfare,'' typically measured throughshort-term effects on price and output24'--fails to capture thearchitecture of market power in the twenty-first century marketplace. In otherwords, the potential harms to competition posed by Amazon's dominance are notcognizable if we assess competition primarily through price and output. Focusingon these metrics instead blinds us to the potential hazards.
My argument is that gauging real competition in thetwenty-first century marketplace'--especially in the case of onlineplatforms'--requires analyzing the underlying structure and dynamics of markets.Rather than pegging competition to a narrow set of outcomes, this approachwould examine the competitive process itself. Animating this framework is theidea that a company's power and the potential anticompetitive nature of thatpower cannot be fully understood without looking to the structure of a businessand the structural role it plays in markets. Applying this idea involves, forexample, assessing whether a company's structure creates certainanticompetitive conflicts of interest; whether it can cross-leverage marketadvantages across distinct lines of business; and whether the structure of themarket incentivizes and permits predatory conduct.
This is the approach I adopt in this Note. I begin byexploring'--and challenging'--modern antitrust law's treatment of market structure.Part I gives an overview of the shift in antitrust away from economicstructuralism in favor of price theory and identifies how this departure hasplayed out in two areas of enforcement: predatory pricing and verticalintegration. Part II questions this narrow focus on consumer welfare as largelymeasured by prices, arguing that assessing structure is vital to protectimportant antitrust values. The Note then uses the lens of market structure toreveal anticompetitive aspects of Amazon's strategy and conduct. Part IIIdocuments Amazon's history of aggressive investing and loss leading, itscompany strategy, and its integration across many lines of business. Part IVidentifies two instances in which Amazon has built elements of its businessthrough sustained losses, crippling its rivals, and two instances in whichAmazon's activity across multiple business lines poses anticompetitive threatsin ways that the current framework fails to register. The Note then assesseshow antitrust law can address the challenges raised by online platforms likeAmazon. Part V considers what capital markets suggest about the economics ofAmazon and other internet platforms. Part VI offers two approaches foraddressing the power of dominant platforms: (1) limiting their dominancethrough restoring traditional antitrust and competition policy principles and(2) regulating their dominance by applying common carrier obligations andduties.
I. the chicago school revolution: the shift away from competitive process and market structureOne of the most significant changes in antitrust law andinterpretation over the last century has been the move away from economicstructuralism. In this Part, I trace this history by sketching out how a structure-basedview of competition has been replaced by price theory and exploring how thisshift has played out through changes in doctrine and enforcement.
Broadly, economic structuralism rests on the idea thatconcentrated market structures promote anticompetitive forms of conduct.25 This view holds that amarket dominated by a very small number of large companies is likely to be lesscompetitive than a market populated with many small- and medium-sizedcompanies. This is because: (1) monopolistic and oligopolistic market structuresenable dominant actors to coordinate with greater ease and subtlety, facilitatingconduct like price-fixing, market division, and tacit collusion; (2) monopolisticand oligopolistic firms can use their existing dominance to block new entrants;and (3) monopolistic and oligopolistic firms have greater bargaining poweragainst consumers, suppliers, and workers, which enables them to hike pricesand degrade service and quality while maintaining profits.
This market structure-based understanding of competition wasa foundation of antitrust thought and policy through the 1960s. Subscribing tothis view, courts blocked mergers that they determined would lead to anticompetitivemarket structures. In some instances, this meant halting horizontaldeals'--mergers combining two direct competitors operating in the same market orproduct line'--that would have handed the new entity a large share of the market.26 In others, it involvedrejecting vertical mergers'--deals joining companies that operated in differenttiers of the same supply or production chain'--that would ''foreclosecompetition.''27 Centrally, this approachinvolved policing not just for size but also for conflicts of interest'--likewhether allowing a dominant shoe manufacturer to extend into shoe retailingwould create an incentive for the manufacturer to disadvantage or discriminateagainst competing retailers.28
The Chicago School approach to antitrust, which gainedmainstream prominence and credibility in the 1970s and 1980s, rejected this structuralist view.29 In the words of RichardPosner, the essence of the Chicago School position is that ''the proper lens forviewing antitrust problems is price theory.''30 Foundational to this view is a faithin the efficiency of markets, propelled by profit-maximizing actors. The ChicagoSchool approach bases its vision of industrial organization on a simpletheoretical premise: ''[R] ational economic actorsworking within the confines of the market seek to maximize profits by combininginputs in the most efficient manner. A failure to act in this fashion will bepunished by the competitive forces of the market.''31
While economic structuralists believe that industrial structure predisposes firms toward certain forms ofbehavior that then steer market outcomes, the Chicago School presumes thatmarket outcomes'--including firm size, industry structure, and concentrationlevels'--reflect the interplay of standalone market forces and the technicaldemands of production.32 In other words, economic structuralists take industry structure as an entryway forunderstanding market dynamics, while the Chicago School holds that industrystructure merely reflects such dynamics. For the Chicago School, ''[w]hat existsis ultimately the best guide to what should exist.''33
Practically, the shift from structuralism to price theory hadtwo major ramifications for antitrust analysis. First, it led to a significantnarrowing of the concept of entry barriers. An entry barrier is a cost thatmust be borne by a firm seeking to enter an industry but is not carried byfirms already in the industry.34 According to the Chicago School, advantagesthat incumbents enjoy from economies of scale, capital requirements, andproduct differentiation do not constitute entry barriers, as these factors areconsidered to reflect no more than the ''objective technical demands ofproduction and distribution.''35With so many ''entry barriers . . . discounted, all firmsare subject to the threat of potentialcompetition . . . regardless of the number of firms orlevels of concentration.''36On this view, market power is always fleeting'--and hence antitrust enforcementrarely needed.
The second consequence of the shift away from structuralismwas that consumer prices became the dominant metric for assessing competition.In his highly influential work, TheAntitrust Paradox, Robert Bork asserted that the sole normative objectiveof antitrust should be to maximize consumer welfare, best pursued throughpromoting economic efficiency.37 Although Bork used ''consumerwelfare'' to mean ''allocative efficiency,''38 courts and antitrust authoritieshave largely measured it through effects on consumer prices. In 1979, theSupreme Court followed Bork's work and declared that ''Congress designed theSherman Act as a 'consumer welfare prescription'''39'--a statement that is widely viewedas erroneous.40 Still, this philosophywound its way into policy and doctrine. The 1982 merger guidelines issued bythe Reagan Administration'--a radical departure from the previous guidelines,written in 1968'--reflected this newfound focus. While the 1968 guidelines hadestablished that the ''primary role'' of merger enforcement was ''to preserve andpromote market structures conducive to competition,''41 the 1982 guidelines saidmergers ''should not be permitted to create or enhance 'market power,''' definedas the ''ability of one or more firms profitably to maintain prices abovecompetitive levels.''42 Today, showing antitrust injuryrequires showing harm to consumer welfare, generally in the form of priceincreases and output restrictions.43
It is true that antitrust authorities do not ignore non-priceeffects entirely. The 2010 Horizontal Merger Guidelines, for example,acknowledge that enhanced market power can manifest as non-price harms,including in the form of reduced product quality, reduced product variety, reducedservice, or diminished innovation.44 Notably, the Obama Administration'sopposition to one of the largest mergers proposed on its watch'--Comcast/ TimeWarner '--stemmed from a concern about market access, notprices.45 And by some measures, theFederal Trade Commission (FTC) has alleged potential harm to innovation inroughly one-third of merger enforcement actions in the last decade.46 Still, it is fair to saythat a concern for innovation or non-price effects rarely animates or drivesinvestigations or enforcement actions'--especially outside of the merger context.47 Economic factors that are easier tomeasure'--such as impacts on price, output, or productive efficiency in narrowlydefined markets'--have become ''disproportionately important.''48
Two areas of enforcement that this reorientation has affecteddramatically are predatory pricing and vertical integration. The Chicago Schoolclaims that ''predatory pricing, vertical integration, and tying arrangementsnever or almost never reduce consumer welfare.''49 Both predatory pricing andvertical integration are highly relevant to analyzing Amazon's path to dominanceand the source of its power. Below, I offer a brief overview of how the ChicagoSchool's influence has shaped predatory pricing doctrine and enforcers' viewsof vertical integration.
A. Predatory PricingThrough the mid-twentieth century, Congress repeatedlyenacted legislation targeting predatory pricing. Congress, as well as statelegislatures, viewed predatory pricing as a tactic used by highly capitalizedfirms to bankrupt rivals and destroy competition'--in other words, as a tool toconcentrate control. Laws prohibiting predatory pricing were part of a larger arrangementof pricing laws that sought to distribute power and opportunity. However, acontroversial Supreme Court decision in the 1960s created an opening forcritics to attack the regime. This intellectual backlash wound its way intoSupreme Court doctrine by the early 1990s in the form of the restrictive '' recoupment test .''
The earliest predatory pricing case in America was thegovernment's antitrust suit against Standard Oil, which reached the SupremeCourt in 1911.50 As detailed in Ida Tarbell's expos(C),A History of the Standard Oil Company, Standard Oil routinely slashedprices in order to drive rivals from the market.51 Moreover, itcross-subsidized: Standard Oil charged monopoly prices52 in markets where it facedno competitors; in markets where rivals checked the company's dominance, itdrastically lowered prices in an effort to push them out. In its antitrust caseagainst the company, the government argued that a suite of practices by StandardOil'--including predatory pricing'--violated section 2 of the Sherman Act. TheSupreme Court ruled for the government and ordered the break-up of the company.53 Subsequent courts cited thedecision for establishing that in the quest for monopoly power, ''price cuttingbecame perhaps the most effective weapon of the larger corporation.''54
Recognizing the threat of predatory pricing executed byStandard Oil, Congress passed a series of laws prohibiting such conduct. In1914 Congress enacted the Clayton Act55 to strengthen the Sherman Act andincluded a provision to curb price discrimination and predatory pricing.56 The House Reportstated that section 2 of the Clayton Act was expressly designed to prohibitlarge corporations from slashing prices below the cost of production ''with theintent to destroy and make unprofitable the business of their competitors'' andwith the aim of ''acquiring a monopoly in the particular locality or section inwhich the discriminating price is made.''57
Congress also acted to protect state ''fair trade'' laws thatfurther safeguarded against predatory pricing. Fair trade legislation grantedproducers the right to set the final retail price of their goods, limiting theability of chain stores to discount.58 When the Supreme Courttargeted these ''resale price maintenance'' efforts, Congress stepped up to defendthem. After the Supreme Court in 1911 struck down the form of resale pricemaintenance enabled by fair trade laws,59 Congress in 1937 carved outan exception for state fair trade laws through the Miller- Tydings Act.60 When the Supreme Court in1951 ruled that producers could enforce minimum prices only against thoseretailers that had signed contracts agreeing to do so,61 Congress responded with alaw making minimum prices enforceable against nonsigners too.62
Another byproduct of the ''fair trade'' movement was theRobinson- Patman Act of 1936. This Act prohibitedprice discrimination by retailers among producers and by producers amongretailers.63 Its aim was to preventconglomerates and large companies from using their buyer power to extractcrippling discounts from smaller entities, and to keep large manufacturers andretailers from teaming up against rivals.64 Like laws banning predatorypricing, the prohibition against price discrimination effectively curbed thepower of size. Section 3 of the Act addressed predatory pricing directly bymaking it a crime to sell goods at ''unreasonably low prices for the purpose ofdestroying competition or eliminating a competitor.''65 While predatory price cuttinggave rise to civil liability and remedies under the Clayton Act, the Robinson- Patman Act attached criminal penalties as well.66
This series of antitrust laws demonstrates that Congress sawpredatory pricing as a serious threat to competitive markets. By themid-twentieth century, the Supreme Court recognized and gave effect to thiscongressional intent. The Court upheld the Robinson- Patman Act numerous times, holding that the relevant factors were whether a retailerintended to destroy competition through its pricing practices and whether itsconduct furthered that purpose.67However, not all instances of below-cost pricing were illegitimate. Liquidatingexcess or perishable goods, for example, was considered fair game.68 Only ''sales made below costwithout legitimate commercial objective and with specific intent to destroycompetition'' would clearly violate section 3.69 In other cases, the Courtdistinguished between competitive advantages drawn from superior skill andproduction, and those drawn from the brute power of size and capital.70 The latter, the Courtruled, were illegitimate.71
In Utah Pie Co. v. Continental Baking Co. , the Court further reinforcedthe illegitimacy of predatory pricing.72 Utah Pie and ContinentalBaking were competing manufacturers of frozen dessert pies. A locationaladvantage gave Utah Pie cheaper access to the Salt Lake City market, which itused to price goods below those sold by competitors. Other frozen pie manufacturers,including Continental, began selling at below-cost prices in the Salt Lake Citymarket, while keeping prices in other regions at or above cost. Utah Piebrought a predatory pricing case against Continental. The Supreme Court ruledfor Utah Pie, noting that the pricing strategies of its competitors had divertedbusiness from Utah Pie and compelled the company to further lower its prices,leading to a ''declining price structure'' overall.73 Additionally, Continentalhad admitted to sending an industrial spy to Utah Pie's plant to gain informationto sabotage Utah's business relations with retailers, a fact the Court used toestablish ''intent to injure.''74
The decision was controversial. Continental's conduct hadloosened the grip of a quasi-monopolist. Prior to the alleged predation, UtahPie had controlled 66.5% of the Salt Lake City market, but followingContinental's practices, its share dropped to 45.3%.75 Penalizing conduct that hadmade a market more competitive aspredatory seemed perverse. As Justice Stewart noted in the dissent, ''I cannothold that Utah Pie's monopolistic position was protected by the federalantitrust laws from effective price competition . . . .''76
The case presented an opportunity for critics of predatorypricing laws to attack the doctrine as misguided. In an article labeling UtahPie ''the most anticompetitive antitrust decision of the decade,'' WardBowman, an economist at Yale Law School, argued that the premise of predatorypricing laws was wrong.77 He wrote, ''The Robinson- Patman Act rests upon a presumption that pricediscrimination can or might be used as a monopolizing technique. This, as morerecent economic literature confirms, is at best a highly dubious presumption.''78 Bork, meanwhile, said ofthe decision, ''There is no economic theory worthy of the name that could findan injury to competition on the facts of the case. Defendants were convictednot of injuring competition but, quite simply, of competing.''79 He described predatorypricing generally as ''a phenomenon that probably does not exist'' and theRobinson- Patman Act as ''the misshapen progeny ofintolerable draftsmanship coupled to wholly mistaken economic theory.''80 Other scholars,particularly those from the rising Chicago School, also weighed in to criticizeUtah Pie . 81
As the writings of Bowman and Bork suggest, the ChicagoSchool critique of predatory pricing doctrine rests on the idea that below-costpricing is irrational and hence rarely occurs.82 For one, the critics argue,there was no guarantee that reducing prices below cost would either drive acompetitor out or otherwise induce the rival to stop competing. Second, even ifa competitor were to drop out, the predator would need to sustain monopolypricing for long enough to recoup the initial losses and successfully thwart entry by potential competitors, who wouldbe lured by the monopoly pricing. The uncertainty of its success, coupled withits guarantee of costs, made predatory pricing an unappealing'--and thereforehighly unlikely'--strategy.83
As the influence and credibility of these scholars grew,their thinking shaped government enforcement. During the 1970s, for example,the number of Robinson- Patman Act cases that the FTCbrought dropped dramatically, reflecting the belief that these cases were oflittle economic concern.84 Under the Reagan Administration, theFTC all but entirely abandoned Robinson- Patman Actcases.85 Bork's appointment as SolicitorGeneral, meanwhile, gave him a prime platform to influence the Supreme Court onantitrust issues and enabled him ''to train and influence many of the attorneyswho would argue before the Supreme Court for the next generation.''86
The Chicago School critique came to shape Supreme Courtdoctrine on predatory pricing. The depth and degree of this influence becameapparent in Matsushita Electric Industrial Co. v. Zenith Radio Corp.87 Zenith, an American manufacturer ofconsumer electronics, brought a Sherman Act section 1 case accusing Japanesefirms of conspiring to charge predatorily low prices in the U.S. market inorder to drive American companies out of business.88 The Supreme Court grantedcertiorari to review whether the Third Circuit had applied the correct standardin reversing the district court's grant of summary judgment to Matsushita'--aninquiry that led the Court to assess the reasonableness of assuming the allegedpredation.89
Citing to Bork's The Antitrust Paradox , the Court concluded that predatorypricing schemes were implausible and therefore could not justify a reasonableassumption in favor of Zenith. ''As [Bork's work] shows, the success of suchschemes is inherently uncertain: the short-run loss is definite, but thelong-run gain depends on successfully neutralizing the competition,'' the Courtwrote.90 ''For this reason, there isa consensus among commentators that predatory pricing schemes are rarely tried,and even more rarely successful.''91
In addition to adopting Bork's cost-benefit framing, theCourt echoed his concern that price competition could be mistaken forpredation. In The Antitrust Paradox , Bork wrote, ''The real danger for the law is less thatpredation will be missed than that normal competitive behavior will be wronglyclassified as predatory and suppressed.''92 Justice Powell, writing forthe 5-4 majority in Matsushita, echoed Bork: '' [C] utting prices in order to increase business often is the very essence of competition. Thus mistaken inferences in cases such as thisone are especially costly, because they chill the very conduct the antitrustlaws are designed to protect.''93
Although Matsushita focusedon a narrow issue'--the summary judgment standard for claims brought underSection 1 of the Sherman Act, which targets coordinationamong parties94'--it has been widely influential inmonopolization cases, which fall under Section 2. In other words, reasoningthat originated in one context has wound up in jurisprudence applying tototally distinct circumstances, even as the underlying violations differvastly.95 Subsequent courts applied Matsushita's predatory pricing analysisto cases involving monopolization and unilateral anticompetitive conduct, shapingthe jurisprudence of Section 2 of the Sherman Act.96 The lower courts seized on Matsushita's central point: the ideathat ''predatory pricing schemes are rarely tried, and even more rarely successful.''97 The phrase became atalisman against the existence of predatory pricing, routinely invoked bycourts in favor of defendants.
In Brooke Group Ltd. v. Brown & Williamson TobaccoCorp.,98 the Supreme Courtformalized this premise into a doctrinal test.The case involved cigarettemanufacturing, an industry dominated by six firms.99 Liggett, one of the six,introduced a line of generic cigarettes, which it sold for about 30% less thanthe price of branded cigarettes.100 Liggett alleged that whenit became clear that its generics were diverting business from brandedcigarettes, Brown & Williamson, a competing manufacturer, began selling itsown generics at a loss.101Liggett sued, claiming that Brown & Williamson's tactic was designed topressure Liggett to raise prices on its generics, thus enabling Brown &Williamson to maintain high profits on branded cigarettes. A jury returned averdict in favor of Liggett, but the district court judge decided that Brown& Williamson was entitled to judgment as a matter of law.102
Importantly, Liggett's accusation was that Brown &Williamson would recoup its losses through raising prices on brandedcigarettes, not the genericscigarettes it was steeply discounting. Building on the analysis introduced in Matsushita,the Court held that Liggett had failed to show that Brown & Williamsonwould be able to execute the scheme successfully by recouping its lossesthrough supracompetitive pricing. ''Evidence ofbelow-cost pricing is not alone sufficient to permit an inference of probable recoupmentand injury to competition,'' Justice Kennedy wrote for the majority.103 Instead, the plaintiff''must demonstrate that there is a likelihood that the predatory scheme allegedwould cause a rise in prices above a competitive level that would be sufficientto compensate for the amounts expended on the predation, including the timevalue of the money invested in it''104'--a requirement now known asthe ''recoupment test.''
In placing recoupment at the center of predatory pricinganalysis, the Court presumed that direct profit maximization is the singulargoal of predatory pricing.105Furthermore, by establishing that harm occurs only when predatorypricing results in higher prices, the Court collapsed the rich set of concernsthat had animated earlier critics of predation, including an aversion to largefirms that exploit their size and a desire to preserve local control. Instead,the Court adopted the Chicago School's narrow conception of what constitutesthis harm (higher prices) and how this harm comes about'--namely, through the alleged predator raising prices onthe previously discounted good.106
Today, succeeding on a predatory pricing claim requires aplaintiff to meet the Brooke Group recoupmenttest by showing that the defendant would be able to recoup its losses throughsustaining supracompetitive prices. Since the Courtintroduced this recoupment requirement, the number of cases brought and won byplaintiffs has dropped dramatically.107 Despite the Court's contention'--that''predatory pricing schemes are rarely tried and even more rarely successful'''--ahost of research shows that predatory pricing can be ''an attractiveanticompetitive strategy'' and has been used by dominant firms across sectors tosquash or deter competition.108
B. Vertical IntegrationAnalysis of vertical integration has similarly moved awayfrom structural concerns. Vertical integration arises when ''two or moresuccessive stages of production and/or distribution of a product are combinedunder the same control.''109For most of the last century, enforcers reviewed vertical integration under thesame standards as horizontal mergers, as set out in the Sherman Act, theClayton Act, and the Federal Trade Commission Act. Vertical integration wasbanned whenever it threatened to ''substantially lessen competition''110 or constituted a''restraint of trade''111or an ''unfair method[ ] of competition.''112 However, the ChicagoSchool's view that vertical mergers are generally pro-competitive has ledenforcement in this area to significantly drop.
Serious concern about vertical integration took hold in thewake of the Great Depression, when both the law and economic theory becamesharply critical of the phenomenon.113 Thurman Arnold, the AssistantAttorney General in the 1930s, targeted vertical ownership achieved throughboth mergers and contractual provisions, and by the 1950s courts and antitrustauthorities generally viewed vertical integration as anticompetitive. Partlybecause it believed that the Supreme Court had failed to use existing law toblock vertical integration through acquisitions, Congress in 1950 amended section7 of the Clayton Act to make it applicable to vertical mergers.114
Critics of vertical integration primarily focused on twotheories of potential harm: leverage and foreclosure. Leverage reflects theidea that a firm can use its dominance in one line of business to establish dominancein another. Because ''horizontal power in one market or stage of productioncreates 'leverage' for the extension of the power to bar entry at anotherlevel,'' vertical integration combined with horizontal market power ''can impaircompetition to a greater extent than could the exercise of horizontal poweralone.''115 Foreclosure, meanwhile,occurs when a firm uses one line of business to disadvantage rivals in anotherline. A flourmill that also owned a bakery could hike prices or degrade qualitywhen selling to rival bakers'--or refuse to do business with them entirely. Inthis view, even if an integrated firm did not directly resort to exclusionarytactics, the arrangement would still increase barriers to entry by requiringwould-be entrants to compete at two levels.
When seeking to block vertical combinations or arrangements,the government frequently built its case on one of these theories'--and, throughthe 1960s, courts largely accepted them.116 In Brown Shoe v. United States, for example, the government sought toblock a merger between a leading manufacturer and a leading retailer of shoeson the grounds that the tie-up would '' foreclos [e]competition'' and '' enhanc [e] Brown's competitiveadvantage over other producers, distributors and sellers of shoes.''117 The Court acknowledgedthat the Clayton Act did not ''render unlawful all . . . vertical arrangements,'' but held that thismerger would undermine competition by '' foreclos [ ing ] . . . independent manufacturersfrom markets otherwise open to them.''118 In other words, theconcern was that'--once merged'--the combined entity would forbid its retailing armfrom stocking shoes made by competing independent manufacturers. Calling thisform of foreclosure ''the primary vice of a vertical merger,''119 the Court noted it wasalso largely inevitable: ''Every extended vertical arrangement by its verynature, for at least a time, denies to competitors of the supplier the opportunityto compete for part or all of the trade of the customer-party to the verticalarrangement.''120 In his partial concurrence,Justice Harlan observed that the deal would enable Brown to ''turn an independentpurchaser into a captive market for its shoes,'' thereby ''diminish[ ing ] the available market for which shoe manufacturerscompete.''121 The Court enjoined the merger.122
Another reason courts cited for blocking these arrangementswas that vertical deals eliminated potential rivals'--a recognition of how amerger would reshape industry structure. Upholding the FTC's challenge of Fordpurchasing an equipment manufacturer, the Court noted that before theacquisition, Ford had helped check the power of the manufacturers and had a''soothing influence'' over prices.123 An outside firm ''maysomeday go in and set the stage for noticeable deconcentration ,''the Court wrote.124''While it merely stays near the edge, it is a deterrent to currentcompetitors.''125 In otherwords, the threat of potential entry by Ford'--the fact that, pre-merger, it could have internally expanded intoequipment manufacturing'--had played an important disciplining role. Relatedly,the Court observed that when a company in a competitive market integrates witha firm in an oligopolistic one, the merger can have ''the result of transmittingthe rigidity of the oligopolistic structure'' of one industry to the other,''thus reducing the chances of future deconcentration ''of the market.126The Court required Ford to divest the manufacturer.127
In the 1950s'--while Congress, enforcement agencies, and thecourts recognized potential threats posed by vertical arrangements'--ChicagoSchool scholars began to cast doubt on the idea that vertical integration hasanticompetitive effects.128By replacing market transactions with administrative decisions within the firm,they argued, vertical arrangements generated efficiencies that antitrust lawshould promote. And if integration failed to yield efficiencies, then theintegrated firm would have no cost advantages over unintegrated rivals,therefore posing no risk of impeding entry. They further argued that verticaldeals would not affect a firm's pricing and output policies, the primarymetrics in their analysis. Under this framework, only horizontal mergers affectcompetition, as ''[h] orizontal mergers increase marketshare, but vertical mergers do not.''129
Chicago School theory holds that concerns about both leverageand foreclosure are misguided. Under the ''single monopoly profit theorem,'' theamount of profit that a firm can extract from one market is fixed and cannot beexpanded through extending into an adjacent market if the two products are usedin fixed proportions.130Under this premise, not only does monopoly leveraging not pose any competitiveconcern, but'--since it can only be motivated by efficiencies, not profits'--it isactually procompetitive when it does occur.
The traditional worries about foreclosure, Bork claimed, wereunfounded, as ''[p] redation through vertical merger isextremely unlikely.''131A manufacturer would not favor its retail subsidiary over others unless it wascheaper to do so'--in which case, Bork argued, discriminating would yieldefficiencies that the firm would pass on to consumers. Additionally, any manufacturerthat sought to privilege its own retailer would face ''entrants who would arrivein sky-darkening swarms for the profitable alternatives.''132 In other words, Bork'stake was that vertical integration generally would not create forms of marketpower that firms could use to hike prices or constrain output. In the rare casethat vertical integration did createthis form of market power, he believed that it would be disciplined by actualor potential entry by competitors.133 In light of this,antitrust law's aversion to vertical arrangements was, Bork argued, irrational.''The law against vertical mergers is merely a law against the creation ofefficiency.''134
With the election of President Reagan, this view of verticalintegration became national policy. In 1982 and 1984, the Department of Justice(DOJ) and the FTC issued new merger guidelines outlining the framework thatofficials would use when reviewing horizontal deals.135 The 1984 version included guidelinesspecific to vertical deals.136Part of a sweeping effort to overhaul antitrust enforcement, the new guidelinesnarrowed the circumstances in which the agencies would challenge verticalmergers.137 Althoughthe guidelines acknowledged that vertical mergers could sometimes give rise tocompetitive concerns, in practice the change constituted a de facto approval ofvertical deals. The DOJ and FTC did not challenge even one vertical mergerduring President Reagan's tenure.138
Although subsequent administrations have continued reviewingvertical mergers, the Chicago School's view that these deals generally do notpose threats to competition has remained dominant.139 Rejection of verticaltie-ups'--standard through the 1960s and 1970s'--is extremely rare today;140 in instances whereagencies spot potential harm, they tend to impose conduct remedies or requiredivestitures rather than block the deal outright.141 The Obama Administrationtook this approach with two of the largest vertical deals of the last decade:Comcast/NBC and Ticketmaster/ LiveNation . In eachcase, consumer advocates opposed the deal142 and warned that the tie-up wouldconcentrate significant power in the hands of a single company,143 which it could use toengage in exclusionary practices, hike prices for consumers, and dock paymentsto content producers, such as TV screenwriters and musicians. Nonetheless, theDOJ attached certain behavioral conditions and required a minor divestiture, ultimatelyapproving both deals.144The district court held the consent decrees to be in the public interest.
II. Why competitive process and structure matterThe current framework in antitrust fails to register certainforms of anticompetitive harm and therefore is unequipped to promote realcompetition'--a shortcoming that is illuminated and amplified in the context ofonline platforms and data-driven markets. This failure stems both fromassumptions embedded in the Chicago School framework and from the way this frameworkassesses competition.
Notably, the present approach fails even if one believes thatantitrust should promote only consumer interests. Critically, consumerinterests include not only cost but also product quality, variety, and innovation.Protecting these long-term interests requires a much thicker conception of''consumer welfare'' than what guides the current approach. But more importantly,the undue focus on consumer welfare is misguided. It betrays legislativehistory, which reveals that Congress passed antitrust laws to promote a host ofpolitical economic ends'--including our interests as workers, producers,entrepreneurs, and citizens. It also mistakenly supplants a concern about processand structure (i.e., whether power is sufficiently distributed to keep marketscompetitive) with a calculation regarding outcome (i.e., whether consumers arematerially better off).
Antitrust law and competition policy should promote notwelfare but competitive markets. By refocusing attention back on process andstructure, this approach would be faithful to the legislative history of majorantitrust laws. It would also promote actual competition'--unlike the presentframework, which is overseeing concentrations of power that risk precludingreal competition.
A. Price and Output Do Not Cover the Full Range of Threats to Consumer Welfare As discussed in Part I, modern doctrine assumes thatadvancing consumer welfare is the sole purpose of antitrust. But the consumerwelfare approach to antitrust is unduly narrow and betrays congressionalintent, as evident from legislative history and as documented by a vast body ofscholarship. I argue in this Note that the rise of dominant internet platformsfreshly reveals the shortcomings of the consumer welfare framework and that itshould be abandoned.
Strikingly, the current approach fails even if one believes that consumer interests should remainparamount.Focusing primarily on price and output undermines effective antitrustenforcement by delaying intervention until market power is being activelyexercised, and largely ignoring whether and how it is being acquired. In otherwords, pegging anticompetitive harm to high prices and/or lower output'--while disregardingthe market structure and competitive process that give rise to this marketpower'--restricts intervention to the moment when a company has already acquiredsufficient dominance to distort competition.
This approach is misguided because it is much easier topromote competition at the point when a market risks becoming less competitivethan it is at the point when a market is no longer competitive. The antitrustlaws reflect this recognition, requiring that enforcers arrest potentialrestraints to competition ''in their incipiency.''145 But the Chicago School'shostility to false positives'--and insistence that market power and highconcentration both reflect and generate efficiency146'--has undermined thisincipiency standard and enfeebled enforcement as a whole. Indeed, enforcershave largely abandoned section 2 monopolization claims,147 which'--by virtue ofassessing how a single company amasses and exercises its power'--traditionallyinvolved an inquiry into structure. By instead relying primarily on price and outputeffects as metrics of competition, enforcers risk overlooking the structuralweakening of competition until it becomes difficult to address effectively, anapproach that undermines consumer welfare.
Indeed, growing evidence shows that the consumer welfareframe has led to higher prices and few efficiencies ,failing by its own metrics.148It arguably has further contributed to a decline in new business growth,resulting in reduced opportunities for entrepreneurs and a stagnant economy.149 The long-term interests ofconsumers include product quality, variety, and innovation'--factors best promotedthrough both a robust competitive process and open markets. By contrast,allowing a highly concentrated market structure to persist endangers theselong-term interests, since firms in uncompetitive markets need not compete toimprove old products or tinker to create news ones. Even if we accept consumerwelfare as the touchstone of antitrust, ensuring a competitive process'--bylooking, in part, to how a market is structured'--ought to be key .Empirical studies revealing that the consumer welfare framehas resulted in higher prices'--failing even by its own terms'--support theneed for a different approach.
B. Antitrust Laws Promote Competition To Serve a Variety of InterestsLegislative history reveals that the idea that ''Congressdesigned the Sherman Act as a 'consumer welfare prescription'''150 is wrong.151 Congress enacted antitrustlaws to rein in the power of industrial trusts, the large business organizationsthat had emerged in the late nineteenth century. Responding to a fear ofconcentrated power, antitrust sought to distribute it. In this sense, antitrustwas ''guided by principles.''152 The law was ''for diversity and access to markets; it was against high concentration and abuses of power.''153
More relevant than any single goal was this general vision.When Congress passed the Sherman Act in 1890,Senator John Sherman called it ''a bill of rights, a charter of liberty,'' andstressed its importance in political terms. 154On the floor of the Senate he declared,
If we will not endure a king as a political power, weshould not endure a king over the production, transportation, and sale of anyof the necessities of life. If we would not submit to an emperor, we should notsubmit to an autocrat of trade, with power to prevent competition and to fixthe price of any commodity.''155
In other words, what was at stake inkeeping markets open'--and keeping them free from industrial monarchs'--wasfreedom.
Animating this vision was the understanding thatconcentration of economic power also consolidates political power, ''breed[ ing ] antidemocratic political pressures.''156 This would occur through enabling asmall minority to amass outsized wealth, which they could then use to influencegovernment. But it would also occur by permitting ''private discretion by a fewin the economic sphere'' to '' control[ ] the welfare ofall,'' undermining individual and business freedom.157 In the lead up to thepassage of the Sherman Act, Senator George Hoar warned that monopolies were ''amenace to republican institutions themselves.''158
This vision encompassed a variety of ends. For one,competition policy would prevent large firms from extracting wealth fromproducers and consumers in the form of monopoly profits.159 Senator Sherman, forexample, described overcharges by monopolists as ''extortion which makes thepeople poor,''160 while Senator Richard Cokereferred to them as ''robbery.''161Representative John Heard announced that trusts had ''stolen millions from thepeople,''162 and Congressman EzraTaylor noted that the beef trust ''robs the farmer on the one hand and theconsumer on the other.''163In the words of Senator James George, ''[t]hey aggregate to themselves greatenormous wealth by extortion which makes the people poor.''164
Notably, this focus on wealth transfers was not solelyeconomic. Leading up to the passage of the Sherman Act, price levels in theUnited States were stable or slowly decreasing.165 If the exclusive concernhad been higher prices, then Congress could have focused on those industrieswhere prices were, indeed, high or still rising. The fact that Congress choseto denounce unjust redistribution suggests that something else was atplay'--namely, that the public was ''angered less by the reduction in their wealththan by the way in which the wealth was extracted.''166 In other words, though theharm was being registered through an economic effect'--a wealth transfer'--theunderlying source of the grievance was also political.167
Another distinct goal was to preserve open markets, in orderto ensure that new businesses and entrepreneurs had a fair shot at entry.Several Congressmen advocated for the Federal Trade Commission Act because itwould help promote small business. Senator James Reed expressly noted that Congress'saim in passing the law was to keep markets open to independent firms.168 When discussing theSherman Act, Senator George lamented that if large-scale industry were allowedto grow unchecked, it would ''crush out all small men, all small capitalists, all small enterprises.''169
Through the 1950s, courts and enforcers applied antitrustlaws to promote this variety of aims. While the vigor and tenor of enforcementvaried, there was an overarching understanding that antitrust served to protectwhat Justice Louis Brandeis called ''industrial liberty.''170 Key to this vision was therecognition that excessive concentrations of private power posed a publicthreat, empowering the interests of a few to steer collective outcomes. ''Powerthat controls the economy should be in the hands of elected representatives ofthe people, not in the hands of an industrial oligarchy,'' Justice William O.Douglas wrote.171Decentralizing this power would ensure that ''the fortunes of the people willnot be dependent on the whim or caprice, the political prejudice, the emotionalstability of a few self-appointed men.''172
As described in Part I, Chicago School scholars upended thistraditional approach, concluding that the only legitimate goal of antitrust isconsumer welfare, best promoted through enhancing economic efficiency. Notably,some prominent liberals'--including John Kenneth Galbraith'--ratified this idea,championing centralization.173In the wake of high inflation in the 1970s, Ralph Nader and other consumer advocatesalso came to support an antitrust regime centered on lower prices, accordingwith the Chicago School's view.174By orienting antitrust toward material rather than political ends, both the neoclassicalschool and its critics effectively embraced concentration over competition.175
Focusing antitrust exclusively on consumer welfare is amistake.176 For one, it betrays legislativeintent, which makes clear that Congress passed antitrust laws to safeguardagainst excessive concentrations of economic power. This vision promotes avariety of aims, including the preservation of open markets, the protection ofproducers and consumers from monopoly abuse, and the dispersion of political177 and economic control.178 Secondly, focusing onconsumer welfare disregards the host of other ways that excessive concentrationcan harm us'--enabling firms to squeeze suppliers and producers, endangeringsystem stability (for instance, by allowing companies to become too big tofail),179 or undermining media diversity,180 to name a few. Protecting this rangeof interests requires an approach to antitrust that focuses on the neutralityof the competitive process and the openness of market structures.
C.Promoting Competition Requires Analysis ofProcess and Structure
The Chicago School's embrace of consumer welfare as the solegoal of antitrust is problematic for at least two reasons. First, as describedin Section II.B, this idea contravenes legislative history, which shows thatCongress passed antitrust laws to safeguard against excessive concentrations ofprivate power. It recognized, in turn, that this vision would protect a host ofinterests, which the sole focus on ''consumer welfare'' disregards. Second, byadopting this new goal, the Chicago School shifted the analytical emphasis awayfrom process'--the conditions necessaryfor competition'--and toward an outcome'--namely,consumer welfare.181In other words, a concern about structure (is power sufficiently distributed tokeep markets competitive?) was replaced by a calculation (did prices rise?).182 This approach isinadequate to promote real competition, a failure that is amplified in the caseof dominant online platforms.
Antitrust doctrine has evolved to reflect this redefinition.The recoupment requirement in predatory pricing, for example, reflects the ideathat competition is harmed only if the predator can ultimately charge consumers supracompetitive prices.183 This logic is agnosticabout process and structure; it measures the health of competition primarilythrough effects on price and output. The same is true in the case of verticalintegration. The modern view of integration largely assumes away barriers to entry,an element of structure, presuming that any advantages enjoyed by theintegrated firm trace back to efficiencies.184
More generally, modern doctrine assumes that market power isnot inherently harmful and instead may result from and generate efficiencies.In practice, this presumes that market power is benign unless it leads to higher prices or reduced output'--again glossingover questions about the competitive process in favor of narrow calculations.185 In other words, this approachequates harm entirely with whether a firm choosesto exercise its market power through price-based levers, while disregardingwhether a firm has developed thispower, distorting the competitive process in some other way.186 But allowing firms toamass market power makes it more difficult to meaningfully check that powerwhen it is eventually exercised. Companies may exploit their market power in ahost of competition-distorting ways that do not directly lead to short-term priceand output effects.
I propose that a better way to understand competition is byfocusing on competitive process and market structure.187 By arguing for a focus onmarket structure, I am not advocating a strict return to the structure-conduct-performanceparadigm. Instead, I claim that seeking to assess competition withoutacknowledging the role of structure is misguided. This is because the best guardianof competition is a competitive process, and whether a market is competitive isinextricably linked to'--even if not solely determined by'--how that market isstructured. In other words, an analysis of the competitive process and marketstructure will offer better insight into the state of competition than domeasures of welfare.
Moreover, this approach would better protect the range ofinterests that Congress sought to promote through preserving competitivemarkets, as described in Section II.B. Foundational to these interests is thedistribution of ownership and control'--inescapably a question of structure.Promoting a competitive process also minimizes the need for regulatory involvement.A focus on process assigns government the task of creating backgroundconditions, rather than intervening to manufacture or interfere with outcomes.188
In practice, adopting this approach would involve assessing arange of factors that give insight into the neutrality of the competitiveprocess and the openness of the market. These factors include: (1) entrybarriers, (2) conflicts of interest, (3) the emergence of gatekeepers orbottlenecks, (4) the use of and control over data, and (5) the dynamics ofbargaining power. An approach that took these factors seriously would involvean assessment of how a market is structured and whether a single firm hadacquired sufficient power to distort competitive outcomes.189 Key questions involvingthese factors would be: What lines of business is a firm involved in and how dothese lines of business interact? Does the structure of the market create orreflect dependencies? Has a dominant player emerged as a gatekeeper so as torisk distorting competition?
Attention to structural concerns and the competitive processare especially important in the context of online platforms, where price-basedmeasures of competition are inadequate to capture market dynamics, particularlygiven the role and use of data.190 As internet platforms mediate agrowing share of both communications and commercial activity, ensuring that ourframework fits how competition actually works in these markets is vital. BelowI document facets of Amazon's power, trace the source of its growth, andanalyze the effects of its dominance. Doing so through the lens of structureand process enables us to make sense of the company's strategy and illuminatesanticompetitive aspects of its business.
III. Amazon's Business StrategyAmazon has established dominance as an online platform thanksto two elements of its business strategy: a willingness to sustain losses andinvest aggressively at the expense of profits, and integration across multiplebusiness lines.191 These facets of its strategy areindependently significant and closely interlinked'--indeed, one way it has beenable to expand into so many areas is through foregoing returns. Thisstrategy'--pursuing market share at the expense of short-term returns'--defies theChicago School's assumption of rational, profit-seeking market actors. Moresignificantly, Amazon's choice to pursue heavy losses while also integratingacross sectors suggests that in order to fully understand the company and thestructural power it is amassing, we must view it as an integrated entity.Seeking to gauge the firm's market role by isolating a particular line ofbusiness and assessing prices in that segment fails to capture both (1) thetrue shape of the company's dominance and (2) the ways in which it is able toleverage advantages gained in one sector to boost its business in another.
A. Willingness To Forego Profits To Establish Dominance Recently, Amazon has started reporting consistent profits,largely due to the success of Amazon Web Services, its cloud computingbusiness.192 Its North America retailbusiness runs on much thinner margins, and its international retail businessstill runs at a loss.193But for the vast majority of its twenty years in business, losses'--not profits'--werethe norm. Through 2013, Amazon had generated a positive net income in just overhalf of its financial reporting quarters. Even in quarters in which it didenter the black, its margins were razor-thin, despite astounding growth. Thegraph below captures the general trend.
Amazon's Profits 194
Just as striking as Amazon's lack of interest in generatingprofit has been investors' willingness to back the company.195 With the exception of afew quarters in 2014, Amazon's shareholders have poured money in despite thecompany's penchant for losses. On a regular basis, Amazon would report losses,and its share price would soar.196As one analyst told the New York Times,''Amazon's stock price doesn't seem to be correlated to its actual experience inany way.''197
Analysts and reporters have spilled substantial ink seekingto understand the phenomenon. As one commentator joked in a widely circulatedpost, ''Amazon, as best I can tell, is a charitable organization being run byelements of the investment community for the benefit of consumers.''198
In some ways, the puzzlement is for naught: Amazon'strajectory reflects the business philosophy that Bezos outlined from the start.In his first letter to shareholders, Bezos wrote:
We believe that a fundamental measure of our successwill be the shareholder value we create over the long term. This value will be a direct result of our ability toextend and solidify our current market leadership position . . . .We first measure ourselves in terms of the metrics most indicative of ourmarket leadership: customer and revenue growth, the degree to which ourcustomers continue to purchase from us on a repeat basis, and the strength ofour brand. We have invested and will continue to invest aggressively to expandand leverage our customer base, brand, and infrastructure as we move to establishan enduring franchise.199
In other words, the premise of Amazon's business model was toestablish scale. To achieve scale, the company prioritized growth. Under thisapproach, aggressive investing would be key, even if that involved slashingprices or spending billions on expanding capacity, in order to becomeconsumers' one-stop-shop. This approach meant that Amazon ''may make decisionsand weigh tradeoffs differently than some companies,'' Bezos warned.200 ''At this stage, we chooseto prioritize growth because we believe that scale is central to achieving thepotential of our business model.''201
The insistent emphasis on ''market leadership'' (Bezos relieson the term six times in the short letter)202 signaled that Amazonintended to dominate. And, by many measures, Amazon has succeeded. Itsyear-on-year revenue growth far outpaces that of other online retailers.203 Despite efforts by big-box competitorslike Walmart, Sears, and Macy's to boost their online operations, no rival hassucceeded in winning back market share.204
One of the primary ways Amazon has built a huge edge isthrough Amazon Prime, the company's loyalty program, in which Amazon hasinvested aggressively. Initiated in 2005, Amazon Prime began by offeringconsumers unlimited two-day shipping for $79.205 In the years since, Amazonhas bundled in other deals and perks, like renting e-books and streaming musicand video, as well as one-hour or same-day delivery. The program has arguablybeen the retailer's single biggest driver of growth.206 Amazon does not disclose the exactnumber of Prime subscribers, but analysts believe the number of users hasreached 63 million'--19 million more than in 2015.207 Membership doubled between 2011 and2013; analysts expect it to ''easily double again by 2017.''208 By 2020, it is estimatedthat half of U.S. households may be enrolled.209
As with its other ventures, Amazon lost money on Prime togain buy-in. In 2011 it was estimated that each Prime subscriber cost Amazon atleast $90 a year'--$55 in shipping, $35 in digital video'--and that the companytherefore took an $11 loss annually for each customer.210 One Amazon expert tallies thatAmazon has been losing $1 billion to $2 billion a year on Prime memberships.211 The full cost of AmazonPrime is steeper yet, given that the company has been investing heavily inwarehouses, delivery facilities, and trucks, as part of its plan to speed updelivery for Prime customers'--expenditures that regularly push it into the red.212
Despite these losses'--or perhaps because of them'--Prime isconsidered crucial to Amazon's growth as an online retailer. According toanalysts, customers increase their purchases from Amazon by about 150% afterthey become Prime members.213Prime members comprise 47% of Amazon's U.S. shoppers.214 Amazon Prime members alsospend more on the company's website'--an average of $1,500 annually, compared to$625 spent annually by non-Prime members.215 Business experts note thatby making shipping free, Prime ''successfully strips out paying for . . . the leading consumer burden ofonline shopping.''216Moreover, the annual fee drives customers to increase their Amazon purchases inorder to maximize the return on their investment.217
As a result, Amazon Prime users are both more likely to buyon its platform and less likely to shop elsewhere. ''[Sixty-three percent] ofAmazon Prime members carry out a paid transaction on the site in the samevisit,'' compared to 13% of non-Prime members.218 For Walmart and Target,those figures are 5% and 2% respectively.219 One study found that lessthan 1% of Amazon Prime members are likely to consider competitor retail sitesin the same shopping session. Non-Prime members, meanwhile, are eight timesmore likely than Prime members to shop between both Amazon and Target in thesame session.220 In the words of one formerAmazon employee who worked on the Prime team, ''It was never about the $79. Itwas really about changing people's mentality so they wouldn't shop anywhereelse.''221 In that regard, AmazonPrime seems to have proven successful.222
In 2014, Amazon hiked its Prime membership fee to $99.223 The move prompted some consumer ire,but 95% of Prime members surveyed said they would either definitely or probablyrenew their membership regardless,224 suggesting that Amazon hascreated significant buy-in and that no competitor is currently offering a comparablyvaluable service at a lower price. It may, however, also reveal the generalstickiness of online shopping patterns. Although competition for onlineservices may seem to be ''just one click away,'' research drawing on behavioraltendencies shows that the ''switching cost'' of changing web services can, infact, be quite high.225
No doubt, Amazon's dominance stems in part from itsfirst-mover advantage as a pioneer of large-scale online commerce. But inseveral key ways, Amazon has achieved its position through deeply cutting pricesand investing heavily in growing its operations'--both at the expense of profits.The fact that Amazon has been willing to forego profits for growth undercuts acentral premise of contemporary predatory pricing doctrine, which assumes thatpredation is irrational precisely because firms prioritize profits over growth.226 In this way, Amazon'sstrategy has enabled it to use predatory pricing tactics without triggering thescrutiny of predatory pricing laws.
B. Expansion into Multiple Business Lines Another key element of Amazon's strategy'--and one partlyenabled by its capacity to thrive despite posting losses'--has been to expandaggressively into multiple business lines.227 In addition to being a retailer,Amazon is a marketing platform, a delivery and logistics network, a paymentservice, a credit lender, an auction house, a major book publisher, a producerof television and films, a fashion designer, a hardware manufacturer, and aleading provider of cloud server space and computing power.228 For the most part, Amazonhas expanded into these areas by acquiring existing firms.229
Involvement in multiple, related businesslines means that, in many instances, Amazon's rivals are also itscustomers. The retailers that compete with it to sell goods may also use itsdelivery services, for example, and the media companies that compete with it toproduce or market content may also use its platform or cloud infrastructure. Ata basic level this arrangement creates conflicts of interest, given that Amazonis positioned to favor its own products over those of its competitors.
Critically, not only has Amazon integrated across selectlines of business, but it has also emerged as central infrastructure for theinternet economy. Reports suggest this was part of Bezos's vision from thestart. According to early Amazon employees, when the CEO founded the business,''his underlying goals were not to build an online bookstore or an onlineretailer, but rather a 'utility' that would become essential to commerce.''230 In other words, Bezos'starget customer was not only end-consumers but also other businesses.
Amazon controls key critical infrastructure for the Interneteconomy'--in ways that are difficult for new entrants to replicate or competeagainst. This gives the company a key advantage over its rivals: Amazon'scompetitors have come to depend on it. Like its willingness to sustain losses,this feature of Amazon's power largely confounds contemporary antitrustanalysis, which assumes that rational firms seek to drive their rivals out ofbusiness. Amazon's game is more sophisticated. By making itself indispensableto e-commerce, Amazon enjoys receiving business from its rivals, even as itcompetes with them. Moreover, Amazon gleans information from these competitorsas a service provider that it may use to gain a further advantage over them asrivals'--enabling it to further entrench its dominant position.
IV. Establishing Structural DominanceAmazon now controls 46% of all e-commerce in the UnitedStates.231 Not only is it thefastest-growing major retailer, but it is also growing faster than e-commerceas a whole.232 In 2010, it employed 33,700 workers;by June 2016, it had 268,900.233It is enjoying rapid success even in sectors that it only recently entered. Forexample, the company ''is expected to triple its share of the U.S. apparelmarket over the next five years.''234 Its clothing salesrecently rose by $1.1 billion'--even as online sales at the six largest U.S.department stores fell by over $500 million.235
These figures alone are daunting, but they do not capture thefull extent of Amazon's role and power. Amazon's willingness to sustain lossesand invest aggressively at the expense of profits, coupled with its integrationacross sectors, has enabled it to establish a dominant structural role in themarket.
In the Sections that follow, I describe several examples ofAmazon's conduct that illustrate how the firm has established structuraldominance.236 These examples'--its handlingof e-books and its battle with an independent online retailer'--focus on predatorypricing practices. These cases suggest ways in which Amazon may benefit frompredatory pricing even if the company does not raise the price of the goods onwhich it lost money. The other examples, Fulfillment-by-Amazon and AmazonMarketplace, demonstrate how Amazon has become an infrastructure company, bothfor physical delivery and e-commerce, and how this vertical integrationimplicates market competition. These cases highlight how Amazon can use itsrole as an infrastructure provider to benefit its other lines of business.These examples also demonstrate how high barriers to entry may make itdifficult for potential competitors to enter these spheres, locking in Amazon'sdominance for the foreseeable future. All four of these accounts raise concernsabout contemporary antitrust's ability to registerand address the anticompetitive threat posed by Amazon and other dominantonline platforms.
A. Below-Cost Pricing of Bestseller E-Books and the Limits of Modern Recoupment Analysis Amazon entered the e-book market by pricing bestsellers belowcost. Although this strategic pricing helped Amazon to establish dominance inthe e-book market, the government perceived Amazon's cost cutting as benign, focusingon the profitability of e-books in the aggregate and characterizing thecompany's pricing of bestsellers as ''loss leading'' rather than predatorypricing. This failure to recognize Amazon's conduct asanticompetitive stems from a misunderstanding of online markets generally andof Amazon's strategy specifically. Additionally, analyzing the issuesraised in this case suggests that Amazon could recoup its losses through meansnot captured by current antitrust analysis.
In late 2007, Amazon rolled out the Kindle, its e-readingdevice, and launched a new e-book library.237 Before introducing thedevice, CEO Jeff Bezos had decided to price bestseller e-books at $9.99,238 significantly below the$12 to $30 that a new hardback typically costs.239 Critically, the wholesale price atwhich Amazon was buying books from publishers had not dropped; it was insteadchoosing to price e-books below cost.240 Analysts estimate that Amazon soldthe Kindle device below manufacturing cost too.241 Bezos's plan was todominate the e-book selling business in the way that Apple had become the go-toplatform for digital music.242The strategy worked: through 2009, Amazon dominated the e-book retail market,selling around 90% of all e-books.243
Publishers, fearingthat Amazon's $9.99 price point for e-books would permanently drive down the pricethat consumers were willing to pay for all books, sought to wrest back somecontrol. When the opportunity came to partner with Apple to sell e-booksthrough the iBookstore store, five of the ''Big Six''publishers introduced agency pricing, whereby publishers would set the finalretail price and Apple would get a 30% cut. 244 After securing this deal, MacMillan, one of the ''Big Six,'' demandedthat Amazon, too, adopt this pricing model. 245 Though it initially refused and delisted MacMillan's books, 246 Amazon ultimately relented, explaining to readers that ''we will haveto capitulate and accept Macmillan's terms because Macmillan has a monopolyover their own titles.'' 247 Other publishers followed suit, haltingAmazon's ability to price e-books at $9.99. 248
In 2012, the DOJ suedthe publishers and Apple for colluding to raise e-book prices. 249 In response to claims that the DOJ was going after the wrongactor'--given that it was Amazon's predatory tactics that drove the publishersand Apple to join forces'--the DOJ investigated Amazon's pricing strategies andfound ''persuasive evidence lacking'' to show that the company had engaged inpredatory practices. 250 According to the government, ''from the time of its launch, Amazon's e-bookdistribution business has been consistently profitable, even when substantiallydiscounting some newly released and bestselling titles.'' 251
Judge Cote, whopresided over the district court trial, refrained from affirming thegovernment's conclusion. 252 Still, the government's argument illustratesthe dominant framework that courts and enforcers use to analyze predation'--andhow it falls short. Specifically, the government erred by analyzing theprofitability of Amazon's e-book business in the aggregate and by characterizingthe conduct as ''loss leading'' rather than potentially predatory pricing. 253 These missteps suggest a failure to appreciate two critical aspects ofAmazon's practices: (1) how steep discounting by a firm on a platform-basedproduct creates a higher risk that the firm will generate monopoly power thandiscounting on non-platform goods and (2) the multiple ways Amazon could recouplosses in ways other than raising the price of the same e-books that itdiscounted.
On the first point,the government argued that Amazon was not engaging in predation because in the aggregate,Amazon's e-books business was profitable. This perspectiveoverlooks how heavy losses on particular lines of e-books (bestsellers, for example,or new releases) may have thwarted competition, even if the e-books business asa whole was profitable. That the DOJ chose to define the relevant market ase-books'--rather than as specific lines, like bestseller e-books'--reflects adeeper mistake: the failure to recognize how the economics of platform-basedproducts differ in crucial ways from non-platform goods. 254 As a result, the DOJ analyzed the e-book market as it would the marketfor physical books.
One indication ofthis failure to appreciate the difference between physical books and e-books isthat the government and Judge Cote treated Amazon's below-cost pricing as lossleading, 255 rather than as predatory pricing. 256 The difference between loss leading and predatory pricing is notspelled out in law, but the distinction turns on the nature of the below-costpricing, specifically its intensity and the intent motivating it. Judge Cote'suse of ''loss leading'' revealed a view that ''Amazon's below-cost pricing was (a)selective rather than pervasive, and (b) not intended to generate monopolypower.'' 257 On this view, Amazon's aim was to triggeradditional sales of other products sold by Amazon, rather than to drive outcompeting e-book sellers and acquire the power to increase e-book prices. 258 In other words, because Amazon's alleged short-term aim was to sellmore e-readers and e-books'--rather than to harm its rivals and raise prices'--itsconduct is considered loss leading rather than predatory pricing. What both theDOJ and the district court missed, however, is the way in which below-costpricing in this instance entrenched and reinforced Amazon's dominance in waysthat loss leading by physical retailers does not.
Unlike with onlineshopping, each trip to a brick-and-mortar store is discrete. If, on Monday,Walmart heavily discounts the price of socks and you are looking to buy socks,you might visit, buy socks, and'--because you are already there'--also buy milk. OnThursday, the fact that Walmart had discounted socks on Monday does notnecessarily exert any tug; you may return to Walmart because you now know thatWalmart often has good bargains, but the fact that you purchased socks fromWalmart on Monday is not, in itself, a reason to return.
Internet retail isdifferent. Say on Monday, Amazon steeply discounts the e-book version of HarperLee's Go Set a Watchman, and you purchase both a Kindle and the e-book. OnThursday, you would be inclined to revisit Amazon'--and not simply because youknow it has good bargains. Several factors extend the tug. For one, Amazon,like other e-book sellers, has used a scheme known as ''digital rights management''(DRM), which limits the types of devices that can read certain e-book formats. 259 Compelling readers to purchase a Kindle through cheap e-books locksthem into future e-book purchases from Amazon. 260 Moreover, buying'--or even browsing'--e-books on Amazon's platform handsthe company information about your reading habits and preferences, data thecompany uses to tailor recommendations and future deals. 261 Replicated across a few more purchases, Amazon's lock-in becomesstrong. It becomes unlikely that a reader will then purchase a Nook and switchto buying e-books through Barnes & Noble, even if that company is slashingprices.
Put differently, lossleading pays higher returns with platform-based e-commerce'--and specificallywith digital products like e-books'--than it does with brick-and-mortar stores.The marginal value of the first sale and early sales in general is much higherfor e-books than for print books because there are lock-in effects at play, dueboth to technical design and the possibilities for and value of personalization.
By treatinge-commerce and digital goods the same as physical stores and goods, both thegovernment and Judge Cote missed the anticompetitive implications of Amazon'sbelow-cost pricing. Though the immediate effect of Amazon's pricing of bestsellere-books may have been to sell more e-books generally, that tactic has alsopositioned Amazon to dominate the market in a way that sets it up to raisefuture prices. In this context, the traditional distinction between lossleading and predatory pricing is strained.
Instead ofrecognizing that the economics of platforms meant that below-cost pricing on aplatform-hosted good would tend to facilitate long-term dominance, the governmenttook comfort that the industry was ''dynamic and evolving'' and concluded thatthe ''presence and continued investment by technology giants, multinational bookpublishers, and national retailers in e-books businesses'' rendered an Amazon-dominatedmarket unlikely. 262 Yet Amazon's early lead has, in fact,translated to long-term dominance. It controls around 65% of the e-book markettoday, 263 while its share of the e-reader market hovers around 74%. 264 Players that appeared up-and-coming even a few years ago are nowretreating from the market. Sony closed its U.S. Reader store and is no longerintroducing new e-readers to the U.S. market. 265 Barnes & Noble, meanwhile, has slashed funding for the Nook by 74%. 266 The only real e-books competitor left standing is Apple. 267
Because thegovernment deflected predatory pricing claims by looking at aggregateprofitability, neither the government nor the court reached the question ofrecoupment. Given that'--under current doctrine'--whether below-cost pricing ispredatory or not turns on whether a firm recoups its losses, we should examinehow Amazon could use its dominance to recoup its losses in ways that are moresophisticated than what courts generally consider or are able to assess.
Most obviously,Amazon could earn back the losses it generated on bestseller e-books by raisingprices of either particular lines of e-books or e-books as a whole. Thisintra-product market form of recoupment is what courts look for. However, it remainsunclear whether Amazon has hiked e-book prices because, as the New York Times noted, ''[ i ]t is difficult to comprehensively track the movement ofprices on Amazon,'' which means that any evidence of price trends is ''anecdotaland fragmentary.'' 268 As Amazon customers can attest, Amazon's pricesfluctuate rapidly and with no explanation. 269
This underscores abasic challenge of conducting recoupment analysis with Amazon: it may not beapparent when and by how much Amazon raises prices. Online commerce enablesAmazon to obscure price hikes in at least two ways: rapid, constant pricefluctuations and personalized pricing. 270 Constant price fluctuations diminish our ability to discern pricing trends. Byone account, Amazon changes prices more than 2.5 million times each day. 271 Amazon is also able to tailor prices to individual consumers, known asfirst-degree price discrimination. There is no public evidence that Amazon iscurrently engaging in personalized pricing, 272 but online retailers generally are devoting significant resources toanalyzing how to implement it. 273 A major topic of discussion at the 2014 National Retail Federationannual convention, for example, was how to introduce discriminatory pricingwithout triggering consumer backlash. 274 One mechanism discussed was highly personalized coupons sent at thepoint of sale, which would avoid the need to show consumers different pricesbut would still achieve discriminatory pricing. 275
Ifretailers'--including Amazon'--implement discriminatory pricing on a wide scale,each individual would be subject to his or her own personal price trajectory,eliminating the notion of a single pricing trend. It is not clear how we wouldmeasure price hikes for the purpose of recoupment analysis in that scenario.There would be no obvious conclusions if some consumers faced higher priceswhile others enjoyed lower ones. But given the magnitude and accuracy of datathat Amazon has collected on millions of users, tailored pricing is not simplya hypothetical power. 276 Discerning whether and by how much Amazon raises book prices will be moredifficult than the Matsushita or Brooke Group Courts could have imagined. 277
It is true thatbrick-and-mortar stores also collect data on customer purchasing habits andsend personalized coupons. But the types of consumer behavior that internetfirms can access'--how long you hover your mouse on a particular item, how manydays an item sits in your shopping basket before you purchase it, or thefashion blogs you visit before looking for those same items through a searchengine'--is uncharted ground. The degree to which a firm can tailor andpersonalize an online shopping experience is different in kind from the methodsavailable to a brick-and-mortar store'--precisely because the type of behaviorthat online firms can track is far more detailed and nuanced. And unlikebrick-and-mortar stores'--where everyone at least sees a common price (even if they go on to receivediscounts)'--internet retail enables firms to entirely personalize consumer experiences,which eliminates any collective baseline from which to gauge price increases ordecreases.
The decision of whichproduct market in which Amazon maychoose to raise prices is also an open question'--and one that current predatorypricing doctrine ignores. Courts generally assume that a firm will recoup byincreasing prices on the same goods on which it previously lost money. Butrecoupment across markets is also available as a strategy, especially for firmsas diversified across products and services as Amazon. Reporting suggests thecompany did just this in 2013, by hiking prices on scholarly and small-pressbooks and creating the risk of a ''two-tier system where some books are pricedbeyond an audience's reach.'' 278 Although Amazon may be recouping its initial losses in e-books throughmarkups on physical books, this cross-market recoupment is not a scenario thatenforcers or judges generally consider. 279 One possible reason for this neglect is that Chicago Schoolscholarship, which assumes recoupment in single-product markets is unlikely,also holds recoupment in multi-product scenarios to be implausible. 280
Although currentpredatory pricing doctrine focuses only on recoupment through raising pricesfor consumers, Amazon could also recoup its losses by imposing higher fees onpublishers. Large book retailer chains like Barnes & Noble have long usedtheir market dominance to charge publishers for favorable product placement,such as displays in a storefront window or on a prominent table. 281 Amazon's dominance in the e-book market has enabled it to demandsimilar fees for even the most basic of services. For example, when renewingits contract with Hachette last year, Amazon demanded payments for servicesincluding the pre-order button, personalized recommendations, and an Amazonemployee assigned to the publisher. 282 In the words of one person close to the negotiations, Amazon ''is veryinventive about what we'd call standard service. . . . They'reteasing out all these layers and saying, 'If you want that service, you'll haveto pay for it.''' 283 By introducing fees on services that itpreviously offered for free, Amazon has created another source of revenue.Amazon's power to demand these fees'--and recoup some of the losses it sustainedin below-cost pricing'--stems from dominance partly built through that samebelow-cost pricing. The fact that Amazon has itself vertically integrated intobook publishing'--and hence can promote its own content'--may give it additionalleverage to hike fees. Any publisher that refuses could see Amazon favor itsown books over the publisher's, reflecting a conflict of interest I discussfurther in Section IV.D. It is not uncommon for half of the titles on Amazon'sKindle bestseller list to be its own. 284
While not captured bycurrent antitrust doctrine, the pressure Amazon puts on publishers merits concern. 285 For one, consolidation among book sellers'--partly spurred by Amazon'spricing tactics and demands for better terms from publishers'--has also spurredconsolidation among publishers. Consolidation among publishers last reached itsheyday in the 1990s'--as publishing houses sought to bulk up in response to thegrowing clout of Borders and Barnes & Noble'--and by the early 2000s, theindustry had settled into the ''Big Six.'' 286 This trend has cost authors and readers alike, leaving writers withfewer paths to market and readers with a less diverse marketplace. SinceAmazon's rise, the major publishers have merged further'--thinning down to five,with rumors of more consolidation to come. 287
Second, theincreasing cost of doing business with Amazon is upending the publishers'business model in ways that further risk sapping diversity. Traditionally,publishing houses used a cross-subsidization model whereby they would use theirbest sellers to subsidize weightier and riskier books requiring greater upfrontinvestment. 288 In the face of higher fees imposed byAmazon, publishers say they are less able to invest in a range of books. In arecent letter to DOJ, a group of authors wrote that Amazon's actions have''extract[ ed ] vital resources from the [book] industryin ways that lessen the diversity and quality of books.'' 289 The authors noted that publishers have responded to Amazon's fees byboth publishing fewer titles and focusing largely on books by celebrities andbestselling authors. 290 The authors also noted, ''Readers are presentedwith fewer books that espouse unusual, quirky, offbeat, or politically riskyideas, as well as books from new and unproven authors. This impoverishesAmerica's marketplace of ideas.'' 291
Amazon's conductwould be readily cognizable as a threat under the pre-ChicagoSchool view that predatory pricing laws specifically and antitrust generallypromoted a broad set of values. Under the predatory pricing jurisprudence ofthe early and mid-twentieth century, harm to the diversity and vibrancy ofideas in the book market may have been a primary basis for governmentintervention. The political risks associated with Amazon's market dominancealso implicate some of the major concerns that animate antitrust laws. For instance,the risk that Amazon may retaliate against books that it disfavors'--either to imposegreater pressure on publishers or for other political reasons'--raises concernsabout media freedom. Given that antitrust authorities previously considereddiversity of speech and ideas a factor in their analysis, Amazon's degree ofcontrol, too, should warrant concern.
Even within thenarrower ''consumer welfare'' framework, Amazon's attempts to recoup lossesthrough fees on publishers should be understood as harmful. A market with lesschoice and diversity for readers amounts to a form of consumer injury. That DOJignored this concern in its suit against Apple and the publishers suggests thatits conception of predatory pricing fails to captureoverlooks the full suite of harms that Amazon's actions may cause. 292
Amazon's below-costpricing in the e-book market'--which enabled it to capture 65% of that market, 293 a sizable share by any measure'--strains predatory pricing doctrine inseveral ways. First, Amazon is positioned to recoup its losses by raisingprices on less popular or obscure e-books, or by raising prices on print books.In either case, Amazon would be recouping outside the original market where itsustained losses (bestseller e-books), so courts are unlikely to look for orconsider these scenarios. Additionally, constant fluctuations in prices and theability to price discriminate enable Amazon to raise prices with little chanceof detection. Lastly, Amazon could recoup its losses by extracting more frompublishers, who are dependent on its platform to market both e-books and printbooks. This may diminish the quality and breadth of the works that arepublished, but since this is most directly a supplier -siderather than buyer-side harm, it is less likely that a modern court wouldconsider it closely. The current predatory pricing framework fails to capturethe harm posed to the book market by Amazon's tactics.
B. Acquisition of Quidsi and Flawed Assumptions About Entry and Exit BarriersIn addition to using below-cost pricing to establish adominant position in e-books, Amazon has also used this practice to putpressure on and ultimately acquire a chief rival. This history challenges contemporaryantitrust law's assumption that predatory pricing cannot be used to establishdominance. While theory may predict that entry barriers for online retail arelow, this account shows that in practice significant investment is needed toestablish a successful platform that will attract traffic. Finally, Amazon's conductsuggests that psychological intimidation can discourage new entry that wouldchallenge a dominant player's market power.
In 2008, Quidsi was one of theworld's fastest growing e-commerce companies.294 It oversaw several subsidiaries: Diapers.com(focused on baby care), Soap.com (focused on household essentials), and BeautyBar.com(focused on beauty products). Amazon expressed interest in acquiring Quidsi in 2009, but the company's founders declined Amazon'soffer.295
Shortly after Quidsi rejectedAmazon's overture, Amazon cut its prices for diapers and other baby products byup to 30%.296 By reconfiguring theirprices, Quidsi executives saw that Amazon's pricingbots'--software ''that carefully monitors other companies' prices and adjustsAmazon's to match'''--were tracking Diapers.com and would immediately slashAmazon's prices in response to Quidsi's changes.297 In September 2010, Amazon rolled outAmazon Mom, a new service that offered a year's worth of free two-day Primeshipping (which usually cost $79 a year).298 Customers could also secure anadditional 30% discount on diapers by signing up for monthly deliveries as partof a service known as ''Subscribe and Save.''299 Quidsi executives ''calculated that Amazon was on track to lose $100 million over threemonths in the diaper category alone.''300
Eventually, Amazon's below-cost pricing started eating into Diapers.com's growth, and it ''slowed under Amazon's pricingpressure.''301 Investors, meanwhile,''grew wary of pouring more money'' into Quidsi , giventhe challenge from Amazon.302Struggling to keep up with Amazon's pricing war, Quidsi's owners began talks with Walmart about potentiallyselling the business. Amazon intervened and made an aggressive counteroffer.303 Although Walmart offered ahigher final bid, ''the Quidsi executives stuck withAmazon, largely out of fear.''304The FTC reviewed the Amazon- Quidsi deal and decidedthat it did not trigger anticompetitive concerns.305 Through its purchase of Quidsi , Amazon eliminated a leading competitor in theonline sale of baby products. Amazon achieved this by slashing prices andbleeding money,306losses that its investors have given it a free pass to incur'--and that a smallerand newer venture like Quidsi , by contrast, could notmaintain.
After completing its buy-up of a key rival'--and seemingly losinghundreds of millions of dollars in the process'--Amazon went on to raise prices.In November 2011, a year after buying out Quidsi ,Amazon shut down new memberships in its Amazon Mom program.307 Though the company hassince reopened the program, it has continued to scale back the discounts and generousshopping terms of the original offer. As of February 2012, discounts that had previouslybeen 30% were reduced to 20%, and the one year of free Prime membership was cutto three months.308In November 2014, the company hiked prices further: members purchasing morethan four items in a month would no longer receive the general 20% discount,and the 20% discount on baby wipes'--one of the program's top-sellingproducts'--was cut to 5%.309Summarizing the series of changes, one journalist observed, ''The Amazon Momprogram has become much less generous than it was when it was introduced in2010.''310 In online forums whereconsumers expressed frustrations with the changes, several users said theywould be taking their business from Amazon and returning to Diapers.com'--which,other users pointed out, was no longer possible.311 Through its strategy,Amazon now holds a strong position in the baby-product market.312
Amazon's conduct runs counter to contemporary predatorypricing thinking, which contends that predation is no path to buying up acompetitor. In The Antitrust Paradox,Bork wrote, ''[T]he modern law ofhorizontal mergers makes it all but impossible for the predator to bring thewar to an end by purchasing his victim. To accomplish the predator's purpose,the merger must create a monopoly'' and law ''would preclude the attainment ofthe monopoly necessary to make predation profitable.''313 For sectors with low entrycosts, Bork writes, this strategy is precluded by the constant possibility ofreentry by other players. ''A shoe retailer can be driven out rapidly, butreentry will be equally rapid.''314In fields in which entry costs are high, Bork argued that exit by competitorsis unlikely because management would need to believe that the predation hadrendered the value of their facilities negligible. For instance, ''[r] ailroading , which involves specialized facilities, isdifficult to enter, but the potential victim of predation would be difficult todrive out precisely because railroad facilities are not useful in other industries.''315
Does online retailing of baby products resemble shoeretailing or railroading? Given the absence of formal barriers, entry should beeasy: unlike railroading, selling baby products online requires no heavy investmentor fixed costs. However, the economics of online retailing are not quite liketraditional shoe retailing. Given that attracting traffic and generating salesas an independent online retailer involves steep search costs, the vastmajority of online commerce is conducted on platforms, central marketplacesthat connect buyers and sellers. Thus, in practice, successful entry by apotential diaper retailer carries with it the cost of attempting to build a newonline platform, or of creating a brand strong enough to draw traffic from anexisting company's platform. As several commentators have observed, thepractical barriers to successful and sustained entry as an online platform arevery high, given the huge first-mover advantages stemming from data collectionand network effects.316 Moreover, the high exit barriersthat Bork assumes for railroads'--namely, that they would have to be convincedtheir facilities were worth more as scrap than as a railroad'--do not apply toonline platforms. Investment in online platforms lies not in physical infrastructurethat might be repurposed, but in intangibles like brand recognition. Theseintangibles can be absorbed by a rival platform or retailer with greater easethan a railroad could take over a competing line.317 In other words, onlineretailers like Quidsi face the high entry barriers ofa railroad coupled with the relatively low exit costs typical ofbrick-and-mortar retailers'--a combination that Bork, and the courts, failed toconsider.
Courts also tend to discount that predators can usepsychological intimidation to keep out the competition.318 Amazon's history with Quidsi has sent a clear message to potentialcompetitors'--namely that, unless upstarts have deep pockets that allow them tobleed money in a head-to-head fight with Amazon, it may not be worth enteringthe market. Even as Amazon has raised the price of the Amazon Mom program, nonewcomers have recently sought to challenge it in this sector, supporting theidea that intimidation may also serve as a practical barrier.319
As the world's largest online retailer, Amazon serves as adefault starting point for many online shoppers: one study estimates that 44%of U.S. consumers '' go[ ] directly to Amazon first tosearch for products.''320Moreover, the swaths of data that Amazon has collected on consumers' browsingand searching histories can create the same problem that Google's would-becompetitors encounter: ''an insurmountable barrier to entry for newcompetition.''321 Though at least oneventure opened shop with an eye to challenging Amazon,322 its founders recently soldthe firm to Walmart323'--a move that suggests that the onlyplayers positioned to challenge Amazon are the existing giants. However, eventhis strategy has skeptics.324While established brick-and-mortar retailers like Target have tried to lureonline consumers through discounts and low delivery costs,325 Amazon remains the majoronline seller of baby products.326Although Amazon established its dominance in this market through aggressiveprice cutting and selling steeply at a loss, its actions have not triggeredpredatory pricing claims. In part, this is because prevailing theoryassumes'--per Bork's analysis'--that market entry is easy enough for new rivals toemerge any time a dominant firm starts charging monopoly prices.
In this case, Amazon raised prices by cutting back discountsand (at least temporarily) refusing to expand the program. Even if a firmviewed the unmet demand as an invitation to enter, several factors would provediscouraging in ways that the existing doctrine does not consider. In theory,online retailing itself has low entry costs since anyone can set up shoponline, without significant fixed costs. But in practice, successful entry inonline markets is a challenge, requiring significant upfront investment. Itrequires either building up strong brand recognition to draw users to anindependent site, or using an existing platform, such as Amazon or eBay, whichcan present other anticompetitive challenges.327 Indeed, most independentretailers choose to sell through Amazon328'--even when the businessrelationship risks undermining their business. The fact that no real rival hasemerged, even after Amazon raised prices, undercuts the assumption embedded incurrent antitrust doctrine.
C. Amazon Delivery and Leveraging Dominance Across SectorsAs its history with Quidsi shows,Amazon's willingness to sustain losses has allowed it to engage in below-costpricing in order to establish dominance as an online retailer. Amazon hastranslated its dominance as an online retailer into significant bargainingpower in the delivery sector, using it to secure favorable conditions fromthird-party delivery companies. This in turn has enabled Amazon to extend itsdominance over other retailers by creating the Fulfillment-by-Amazon serviceand establishing its own physical delivery capacity. This illustrates how acompany can leverage its dominant platform to successfully integrate into othersectors, creating anticompetitive dynamics. Retail competitors are left withtwo undesirable choices: either try to compete with Amazon at a disadvantage orbecome reliant on a competitor to handle delivery and logistics.
As Amazon expanded its share of e-commerce'--and enlarged thee-commerce sector as a whole'--it started comprising a greater share of deliverycompanies' business. For example, in 2015, UPS derived $1 billion worth ofbusiness from Amazon alone.329The fact that it accounted for a growing share of these firms' businesses gaveAmazon bargaining power to negotiate for lower rates.330 By some estimates, Amazonenjoyed a 70% discount over regular delivery prices.331 Delivery companies soughtto make up for the discounts they gave to Amazon by raising the prices theycharged to independent sellers,332a phenomenon recently termed the ''waterbed effect.''333 As scholars have described,
[T]he presence of a waterbed effect can furtherdistort competition by giving a powerful buyer now a two-fold advantage,namely, through more advantageous terms for itself and through higher purchasingcosts for its rivals. What then becomes a virtuous circle for the strong buyerends up as a vicious circle for its weaker competitors.334
To this two-fold advantage Amazon added a third perk:harnessing the weakness of its rivals into a business opportunity. In 2006,Amazon introduced Fulfillment-by-Amazon (FBA), a logistics and delivery servicefor independent sellers.335Merchants who sign up for FBA store their products in Amazon's warehouses, andAmazon packs, ships, and provides customer service on any orders. Products soldthrough FBA are eligible for service through Amazon Prime'--namely, free two-dayshipping and/or free regular shipping, depending on the order.336 Since many merchantsselling on Amazon are competing with Amazon's own retail operation and itsAmazon Prime service, using FBA offers sellers the opportunity to compete atless of a disadvantage.
Notably, it is partly because independent sellers facedhigher rates from UPS and FedEx'--a result of Amazon's dominance'--that Amazonsucceeded in directing sellers to its new business venture.337 In many instances, ordersrouted through FBA were still being shipped and delivered by UPS and FedEx,since Amazon relied on these firms.338 But because Amazon hadsecured discounts unavailable to other sellers, it was cheaper for thosesellers to go through Amazon than to use UPS and FedEx directly. Amazon hadused its dominance in the retail sector to create and boost a new venture inthe delivery sector, inserting itself into the business of its competitors.
Amazon has followed up on this initial foray into fulfillmentservices by creating a logistics empire. Building out physical capacity letsAmazon further reduce its delivery times, raising the bar for entry yet higher.Moreover it is the firm's capacity for aggressive investing that has enabled itto rapidly establish an extensive network of physical infrastructure. Since2010, Amazon has spent $13.9 billion building warehouses, 339 and it spent $11.5 billionon shipping in 2015 alone.340Amazon has opened more than 180 warehouses,341 28 sorting centers, 59 deliverystations that feed packages to local couriers, and more than 65 Prime Now hubs.342 Analysts estimate that thelocations of Amazon's fulfillment centers bring it within twenty miles of 31%of the population and within twenty miles of 60% of its core same-day base.343 This sprawling network offulfillment centers'--each placed in or near a major metropolitan area'--equipsAmazon to offer one-hour delivery in some locations and same-day in others (aservice it offers free to members of Amazon Prime).344 While several rivalsinitially entered the delivery market to compete with Prime shipping, some arenow retreating.345As one analyst noted, ''Prime has proven exceedingly difficult for rivals tocopy.''346
Most recently, Amazon has also expanded into trucking. LastDecember, it announced it plans to roll out thousands of branded semi-trucks, amove that will give it yet more control over delivery, as it seeks to speed uphow quickly it can transport goods to customers.347 Amazon now owns four thousand trucktrailers and has also signed contracts for container ships, planes,348 and drones.349 As of October 2016, Amazonhad leased at least forty jets.350Former employees say Amazon's long-term goal is to circumvent UPS and FedEx altogether,though the company itself has said it is looking only to supplement itsreliance on these firms,not supplant them.351
The way that Amazon has leveraged its dominance as an onlineretailer to vertically integrate into delivery is instructive on severalfronts. First, it is a textbook example of how the company can use its dominancein one sphere to advantage a separate line of business. To be sure, thisdynamic is not intrinsically anticompetitive. What should prompt concern inAmazon's case, however, is that Amazon achieved these cross-sector advantagesin part due to its bargaining power. Because Amazon was able to demand heavydiscounts from FedEx and UPS, other sellers faced price hikes from thesecompanies'--which positioned Amazon to capture them as clients for its newbusiness. By overlooking structural factors like bargaining power, modern antitrustdoctrine fails to address this type of threat to competitive markets.
Second, Amazon is positioned to use its dominance acrossonline retail and delivery in ways that involve tying, are exclusionary, andcreate entry barriers.352That is, Amazon's distortion of the delivery sector in turn creates anticompetitivechallenges in the retail sector. For example, sellers who use FBA have a betterchance of being listed higher in Amazon search results than those who do not,which means Amazon is tying the outcomes it generates for sellers using itsretail platform to whether they also use its delivery business.353 Amazon is also positionedto use its logistics infrastructure to deliver its own retail goods faster thanthose of independent sellers that use its platform and fulfillment service'--aform of discrimination that exemplifies traditional concerns about verticalintegration. And Amazon's capacity for losses and expansive logisticscapacities mean that it could privilege its own goods while still offering independentsellers the ability to ship goods more cheaply and quickly than they could byusing UPS and FedEx directly.
Relatedly, Amazon's expansion into the delivery sector alsoraises questions about the Chicago School's limited conception of entry barriers.The company's capacity for losses'--the permission it has won from investors toshow negative profits'--has been key in enabling Amazon to achieve outsizedgrowth in delivery and logistics. Matching Amazon's network would require arival to invest heavily and'--in order to viably compete'--offer free or otherwisebelow-cost shipping. In interviews with reporters, venture capitalists saythere is no appetite to fund firms looking to compete with Amazon on physicaldelivery.354 In this way, Amazon'sability to sustain losses creates an entry barrier for any firm that does notenjoy the same privilege.
Third, Amazon's use of Prime and FBA exemplifies how thecompany has structurally placed itself at the center of e-commerce. Already 44%of American online shoppers begin their online shopping on Amazon's platform.355 Given the traffic, it isbecoming increasingly clear that in order to succeed in e-commerce, anindependent merchant will need to use Amazon's infrastructure. The fact thatAmazon competes with many of the businesses that are coming to depend on itcreates a host of conflicts of interest that the company can exploit toprivilege its own products.
The dominant framework in antitrust today fails to recognizethe risk that Amazon's dominance poses for discrimination and barriers to newentry. In part, this is because'--as with the framework's view of predatory pricing'--the primary harm that registers within the ''consumerwelfare'' frame is higher consumer prices. On the Chicago School's account,Amazon's vertical integration would only be harmful if and when it chooses touse its dominance in delivery and retail to hike fees to consumers. Amazon hasalready raised Prime prices.356But antitrust enforcers should be equally concerned about the fact that Amazonincreasingly controls the infrastructure of online commerce'--and the ways inwhich it is harnessing this dominance to expand and advantage its new businessventures. The conflicts of interest that arise from Amazon both competing withmerchants and delivering their wares pose a hazard to competition, particularlyin light of Amazon's entrenched position as an online platform. Amazon's conflictsof interest tarnish the neutrality of the competitive process. The thousands ofretailers and independent businesses that must ride Amazon's rails to reachmarket are increasingly dependent on their biggest competitor.
D. Amazon Marketplace and Exploiting DataAs described above, vertical integration in retail andphysical delivery may enable Amazon to leverage cross-sector advantages in waysthat are potentially anticompetitive but not understood as such under currentantitrust doctrine. Analogous dynamics are at play with Amazon's dominance inthe provision of online infrastructure,in particular its Marketplace for third-party sellers. Because informationabout Amazon's practices in this area is limited, this Section necessarily willbe brief. But to capture fully the anticompetitive features of Amazon'sbusiness strategy, it is vital to analyze how vertical integration across internetbusinesses introduces more sophisticated'--and potentially more troubling'--opportunitiesto abuse cross-market advantages and foreclose rivals.
The clearest example of how the company leverages its poweracross online businesses is Amazon Marketplace, where third-party retailerssell their wares. Since Amazon commands a large share of e-commerce traffic,many smaller merchants find it necessary to use its site to draw buyers.357 These sellers list their goods onAmazon's platform and the company collects fees ranging from 6% to 50% of theirsales from them.358More than two million third-party sellers used Amazon's platform as of 2015, anincrease from the roughly one million that used the platform in 2006.359 The revenue that Amazongenerates through Marketplace has been a major source of its growth:third-party sellers' share of total items sold on Amazon rose from 36% in 2011360 to over 50% in 2015.361
Third-party sellers using Marketplace recognize that usingthe platform puts them in a bind. As one merchant observed, ''You can't reallybe a high-volume seller online without being on Amazon, but sellers are veryaware of the fact that Amazon is also their primary competitor.''362 Evidence suggests thattheir unease is well founded. Amazon seems to use its Marketplace ''as a vastlaboratory to spot new products to sell, test sales of potential new goods, andexert more control over pricing.''363 Specifically, reportingsuggests that ''Amazon uses sales data from outside merchants to make purchasingdecisions in order to undercut them on price'' and give its own items ''featuredplacement under a given search.''364 Take the example of PillowPets, ''stuffed-animal pillows modeled after NFL mascots'' that a third-partymerchant sold through Amazon's site.365 For several months, themerchant sold up to one hundred pillows per day.366 According to oneaccount, ''just ahead of the holidayseason, [the merchant] noticed Amazon had itself beg[u]n offering the samePillow Pets for the same price while giving [its own] products featuredplacement on the site.''367The merchant's own sales dropped to twenty per day.368 Amazon has gonehead-to-head with independent merchants on price, vigorously matching and evenundercutting them on products that they had originally introduced. By goingdirectly to the manufacturer, Amazon seeks to cut out the independent sellers.
In other instances, Amazon has responded to popularthird-party products by producing them itself. Last year, a manufacturer thathad been selling an aluminum laptop stand on Marketplace for more than a decadesaw a similar stand appear at half the price. The manufacturer learned that thebrand was AmazonBasics , the private line that Amazonhas been developing since 2009.369As one news site describes it, initially, AmazonBasics focused on generic goods like batteries and blank DVDs. ''Then, for severalyears, the house brand 'slept quietly as it retained data about other sellers'successes.'''370 As it now rolls out more AmazonBasics products, it is clear that the company hasused ''insights gleaned from its vast Web store to build a private-labeljuggernaut that now includes more than 3,000 products.''371 One study found that inthe case of women's clothing, Amazon ''began selling 25 percent of the top itemsfirst sold through marketplace vendors.''372
It is true that brick-and-mortar retailers sometimes alsointroduce private labels and may use other brands' sales records to decide whatto produce. The difference with Amazon is the scale and sophistication of thedata it collects. Whereas brick-and-mortar stores are generally only able tocollect information on actual sales, Amazon tracks what shoppers are searchingfor but cannot find, as well as which products they repeatedly return to, whatthey keep in their shopping basket, and what their mouse hovers over on thescreen.373
In using its Marketplace this way, Amazon increases saleswhile shedding risk. It is third-party sellers who bear the initial costs anduncertainties when introducing new products; by merely spotting them, Amazongets to sell products only once their success has been tested. Theanticompetitive implications here seem clear: Amazon is exploiting the factthat some of its customers are also its rivals. The source of this power is: (1)its dominance as a platform, which effectively necessitates that independentmerchants use its site; (2) its vertical integration'--namely, the fact that itboth sells goods as a retailer and hosts sales by others as a marketplace; and(3) its ability to amass swaths of data, by virtue of being an internetcompany. Notably, it is this last factor'--its control over data'--that heightensthe anticompetitive potential of the first two.
Evidence suggests that Amazon is keenly aware of andinterested in exploiting these opportunities. For example, the company has reportedlyused insights gleaned from its cloud computing service to inform its investmentdecisions.374 By observingwhich start-ups are expanding their usage of Amazon Web Services, Amazon can makeearly assessments of the potential success of upcoming firms. Amazon has usedthis ''unique window into the technology startup world'' to invest in severalstart-ups that were also customers of its cloud business.375
How Amazon hascross-leveraged its advantages across distinct lines of business suggests thatthe law fails to appreciate when vertical integration may prove anticompetitive.This shortcoming is underscored with online platforms, which both serve asinfrastructure for other companies and collect swaths of data that they canthen use to build up other lines of business. In this way, the currentantitrust regime has yet to reckon with the fact that firms with concentratedcontrol over data can systematically tilt a market in their favor, dramaticallyreshaping the sector.376
V. How Platform Economics and Capital Markets May Facilitate Anticompetitive Conduct and Structures As Part IV mapped out, aspects of Amazon's conduct andstructure may threaten competition yet fail to trigger scrutiny under theanalytical framework presently used in antitrust. In part this reflects the ''consumerwelfare'' orientation of current antitrust laws, as critiqued in Part II. But italso reflects a failure to update antitrust for the internet age. This Partexamines how online platforms defy and complicate assumptions embedded incurrent doctrine. Specifically, it considers how the economics and businessdynamics of online platforms create incentives for companies to pursue growthat the expense of profits, and how online markets and control over data may enablenew forms of anticompetitive activity.
Economists have analyzed extensively how platform markets maypose unique challenges for antitrust analysis.377 Specifically, they stressthat analysis applicable to firms in single-sided markets may break down whenapplied to two-sided markets, given the distinct pricing structures and networkexternalities.378These studies often focus on the challenge that two-sided platforms face inattracting both sides'--the classic coordination problem of having to attractbuyers without an established line of sellers, and vice versa.379 Economists tend to concludethat'--given the particular challenges of two-sided markets380'--antitrust should beforgiving of conduct that might otherwise be characterized as anticompetitive.381
Legalanalysis ofonline platforms is comparatively undertheorized . TheJustice Department's case against Microsoft under Section 2 of the Sherman Act,initiated in the 1990s, remains the government's most significant case involvingtwo-sided markets'--even as platforms have emerged as central arteries in ourmodern economy. Starting in 2011, the FTC pursued an investigation into Google,partly in response to allegations that the company uses its dominance as asearch engine to cement its advantage and exclude rivals in other lines ofbusiness. While the FTC closed the investigation without bringing any charges,leaks later revealed that FTC staff had concluded that Google abused its poweron three separate counts.382The European Union has brought charges against Google for violating antitrustlaws.383
For the purpose of competition policy, one of the mostrelevant factors of online platform markets is that they are winner-take-all.This is due largely to network effects and control over data, both of which meanthat early advantages become self-reinforcing. The result is that technologyplatform markets will yield to dominance by a small number of firms. Walmart'srecent purchase of the one start-up that had sought to challenge Amazon inonline retail'--Jet.com'--illustrates this reality.384
Network effects arise when a user's utility from a productincreases as others use the product. Since popularity compounds and isreinforcing, markets with network effects often tip towards oligopoly or monopoly.385 Amazon's user reviews, for example,serve as a form of network effect: the more users that have purchased andreviewed items on the platform, the more useful information other users canglean from the site.386As the Fourth Circuit has noted, ''[O] nce dominance isachieved, threats come largely from outside the dominated market, because thedegree of dominance of such a market tends to become so extreme.''387 In this way, networkeffects act as a form of entry barrier.
A platform's control over data, meanwhile, can also entrenchits position.388 Access to consumer dataenables platforms to better tailor services and gauge demand. Involvement across markets, meanwhile, may permit acompany to use data gleaned from one market to benefit another business line.389 Amazon's use ofMarketplace data to advantage its retail sales, as described in Section IV.D,is an example of this dynamic. Control over data may also make it easier for dominantplatforms to enter new markets with greater ease. For example, reports nowsuggest that Amazon may dramatically expand its footprint in the ad business,''leveraging its rich supply of shopping data culled from years of operating amassive e-commerce business.''390In other words, control over data, too, acts as an entry barrier.
Given that online platforms operate in markets where networkeffects and control over data solidify early dominance, a company looking tocompete in these markets must seek to capture them. The most effective way isto chase market share and drive out one's rivals'--even if doing so comes at theexpense of short-term profits, since the best guarantee of long-term profits isimmediate growth. Due to this dynamic, striving to maximize market share at theexpense of one's rivals makes predation highly rational; indeed, it would beirrational for a business not tofrontload losses in order to capture the market. Recognizing that enduringearly losses while aggressively expanding can lock up a monopoly, investors seem willing to back this strategy.
As the Introduction and Part III describe, Amazon has chartedimmense growth while investing aggressively'--both by expanding provision ofphysical and online infrastructure and by pricing goods below cost. Amazon'sstock price has soared despite a history of razor-thin'--or evennegative'--margins. In essence, investors have given Amazon a free pass to growwithout any pressure to show profits. The firm has used this edge to expandwildly and dominate online commerce.
The idea that investors are willing to fund predatory growthin winner-take-all markets also holds in the case of Uber .Although the dynamics of the online retail market are distinct from those ofride-sharing, Uber's growth trajectory is worth analyzingfor general insight into how investors enable platform dominance. In 2015, newsreports revealed that Uber had an operating loss of$470 million on $415 million in revenue, confirming suspicions that the companyhas been bleeding money for the sake of achieving steep growth and acquiringmarket share.391 In China, the company has lost morethan $1 billion a year.392The strategy of aggressive price competition and brazen leadership coupled withsoaring growth prompted immediate comparisons to Amazon.393 Like Amazon, Uber has drawn immense interest from investors. As of July2015, its valuation hit nearly $51 billion, equaling the record set by Facebookin 2012.394 It recently secured anadditional $3.5 billion in investment, bringing its total funds to $13.5billion'--a figure ''far greater than most companies raise even during an initialpublic offering,'' which Uber has avoided.395
One might dismiss this phenomenon as irrational investorexuberance. But another way to read it is at face value: the reason investorsvalue Amazon and Uber so highly is because theybelieve these platforms will, eventually, generate huge returns. As one venturecapitalist recently remarked, if he had to ''put his entire capital in a singlecompany and hold it for the next 10 years,'' he would choose Amazon. ''I don'tsee any cleaner monopoly available to buy in the public markets right now.''396 In other words, that theseplatform companies are undertaking consistent, steep losses and stillgenerating strong investor backing suggests that the markets expect Amazon and Uber to recoup these losses.
While investors have unambiguously endorsed and funded onlineplatforms' quest to bleed money in their race to draw users, antitrust doctrinefails to acknowledge this strategy. In the past, the Supreme Court's analysishas embraced the Efficient Market Hypothesis (EMH), the idea that market pricesreflect all available information.397 The Justice Departmentalso acknowledges that market information'--for example, the financial terms ofan acquisition'--may ''be informative regarding competitive effects.''398 Applying EMH in this instanceoverwhelmingly suggests that these platforms are positioned to recoup theirlosses. Yet bringing a predatory pricing suit against an online platform wouldbe almost impossible to win in light of the recoupment requirement. Strikingly,the market is reflecting a reality that our current laws are unable to detect.399
In addition to overlooking why online platform dynamics makepredation especially rational, current doctrine also fails to appreciate how aplatform might recoup losses. For one, investor support allows Amazon tostrategize and operate on a time horizon far longer than what the Brooke Group or Matsushita Courts confronted. Raising prices in a third year afterenduring losses for two is different from engaging in a decade-long quest tobecome the dominant online retailer and provider of internet infrastructure. Thatlonger timeline, meanwhile, makes available more recoupment mechanisms. Notonly has Amazon inaugurated an entire generation into online shopping throughits platform, but it has expanded into a suite of additional businesses andamassed significant troves of data on users. This data enables it both toextend its tug over customers through highly tailored personal shoppingexperiences, and, potentially, to institute forms of price discrimination, asdescribed in Section IV.A. Both the latitude granted by investors and controlover data equip an incumbent platform to recoup losses in ways less obviouslyconnected to the initial form of below-cost pricing.
These recoupment mechanisms may also be more sophisticatedthan what a judge or even rivals would be able to spot. This last point becomeseven more apparent in the context of Uber , whose dynamicpricing has conditioned users not to expect a stable or regular price. While Uber claims that its algorithms set prices to reflectreal-time supply and demand, initial research has found that the company manipulatesthe availability of both.400Moreover, it routinely gives away discount coupons to select users, effectivelycharging users different prices, even for the same service at the same time.401
Although platforms form the backbone of the internet economy,the way that platform economics implicates existing laws is relatively undertheorized .402 Amazon's conduct suggeststhat predatory pricing and integration across related business lines areemerging as key paths to establishing dominance'--aided by the control over datathat dominant platforms enjoy. But because current predatory pricing doctrinedefines recoupment in overly narrow terms, competitors generally have not beenable to make an effective legal case. Similarly, because current doctrinelargely discounts entry barriers, the anticompetitive effects of verticalintegration are difficult to cognize under the existing framework. Roadblocksto these claims persist even as Amazon's valuation and share price point to astrong market expectation of recoupment and profits.
There are signs that enforcers are becoming more attuned tothe special factors that may render current antitrust analysis inadequate topromote competition in internet platform markets. For example, in 2014 theUnited States successfully challenged a merger between two leading providers ofonline ratings and reviews platforms. In its complaint, DOJ acknowledged thatdata-driven industries can be characterized by network effects, which increaseswitching costs and entry barriers.403 Recent comments by FTCCommissioner Terrell McSweeny '--noting that data canact as a barrier to entry and that ''competition enforcers can and should assessthe competitive implications of data'''--also suggest that top officials areassessing how to revise their tools and framework for gauging competition inplatform markets.404
While this burgeoning recognition is heartening, the uniquefeatures of platform markets require a more thorough evaluation of howantitrust is applied. Because scale is both vital to platforms' business modeland helps entrench their dominant position, antitrust should reckon with thefact that pursuing growth at the expense of returns is'--contra to currentdoctrine'--highly rational. An approach more attuned to the realities of onlineplatform markets would also recognize the variety of mechanisms that businessesmay use to recoup losses, the longer time horizon on which recoupment mightoccur, and the ways that vertical integration and concentrated control overdata may enable new forms of anticompetitive conduct. Revising antitrust toreflect the dynamics of online platforms is vital, especially as these companiescome to mediate a growing share of communications and commerce.
VI. Two Models for Addressing Platform Power If it is true that the economics of platform markets mayencourage anticompetitive market structures, there are at least two approacheswe can take. Key is deciding whether we want to govern online platform marketsthrough competition, or want to accept that they are inherently monopolistic oroligopolistic and regulate them instead. If we take the former approach, weshould reform antitrust law to prevent this dominance from emerging or to limitits scope. If we take the latter approach, we should adopt regulations to takeadvantage of these economies of scale while neutering the firm's ability toexploit its dominance.
A. Governing Online Platform Markets Through CompetitionReforming antitrust to address the anticompetitive nature ofplatform markets could involve making the law against predatory pricing morerobust and strictly policing forms of vertical integration that firms can usefor anticompetitive ends. Importantly, each of these doctrinal areas should bereformulated so that it is sensitive to preserving the competitive process andlimiting conflicts of interest that may incentivize anticompetitive conduct.
1. Predatory PricingWhile predatory pricing technically remains illegal, it isextremely difficult to win predatory pricing claims because courts now requireproof that the alleged predator would be able to raise prices and recoup itslosses.405 Revising predatory pricingdoctrine to reflect the economics of platform markets, where firms can sinkmoney for years given unlimited investor backing, would require abandoning therecoupment requirement in cases of below-cost pricing by dominant platforms.And given that platforms are uniquely positioned to fund predation, acompetition-based approach might also consider introducing a presumption ofpredation for dominant platforms found to be pricing products below cost.
Several reasons militate in favor of a presumption ofpredation in such cases. First, firms may raise prices years after the originalpredation, or raise prices on unrelated goods, in ways difficult to prove attrial. Second, firms may raise prices through personalized pricing or pricediscrimination, in ways not easily detectable. Third, predation can lead to ahost of market harms even if the firmdoes not raise consumer prices. Within a consumer welfare framework, theseharms include degradation of product quality and sapping diversity of choice.406 Such harms may arise ifAmazon uses its bargaining power to extract better terms from producers andsuppliers, who, in turn, slash investments to meet its demands. Within abroader framework'--which seeks to protect the full range of interests thatantitrust laws were enacted to safeguard'--the potential harms include lowerincome and wages for employees, lower rates of new business creation, lowerrates of local ownership, and outsized political and economic control in thehands of a few.407
Introducing a presumption of predation would involveidentifying when a price is below cost, a subject of much debate. The SupremeCourt has not addressed the issue, but most appellate courts have said thataverage variable cost is the right metric.408 This Note does notadvocate the adoption of one particular measure over others. Admittedly, ''belowcost'' is an imperfect filter, especially since what constitutes the relevantcost may vary depending on the industry or cost structure. And the specificdefinition of ''costs'' that courts and enforcers adopt may ultimately be lesssignificant if the test for predatory pricing also permits a businessjustification defense, which would help screen against false positives.409 A business justification defensecould cover compensating a buyer for taking the risk of buying a new product, expandingdemand to a level which will allow the entrant to achieve scale economies,keeping prices at competitive levels while expecting costs to decline, andmatching competition.410
Whether a platform is dominant enough to trigger thepresumption could be assessed through its market share: those holding greaterthan, say, 40% of the market in any given line of service (e.g., cloudcomputing, ride sharing) might be designated ''dominant.'' Rather than measuringthis market share nationally, enforcers would look to levels of local control;a ride-sharing platform that held only 35% of the national market but 75% ofthe Nashville market would still be considered dominant for the purpose ofprice-cutting in Nashville.
2. Vertical IntegrationThe current approach to antitrust does not sufficientlyaccount for how vertical integration may give rise to anticompetitive conflictsof interest, nor does it adequately address the way a dominant firm may use itsdominance in one sector to advance another line of business. This concern isheightened in the context of vertically integrated platforms, which can useinsights generated through data acquired in one sector to undermine rivals inanother. Potential ways to address this deficiency include scrutinizing mergersthat would enable a firm to acquire valuable data and cross-leverage it, or introducinga prophylactic ban on mergers that would give rise to conflicts of interest.
One way to address the concern about a firm's capacity tocross-leverage data is to expressly include it in merger review.411 Under the currentapproach, only mergers over a particular monetary threshold require agencyreview412'--yet the monetary value ofa deal may not be a good proxy for the scope and scale of data at stake. Thus,it could make sense for the agencies to automatically review any deal thatinvolves exchange of certain forms (or a certain quantity) of data. Data thatgave a player deep and direct insight into a competitor's business operations,for example, might trigger review. Under this regime, Facebook's purchases ofWhatsApp and Instagram,413for instance, would have received greater scrutiny from the antitrust agencies,in recognition of how acquiring data can deeply implicate competition. Internationaltransactions granting foreign corporations access to data on U.S. users wouldalso require close review. Uber's decision to sellits China operations to Didi Chuxing ,China's dominant ride-sharing service'--a deal through which Uber will also gain partial ownership over its main U.S. rival, Lyft 414'--is one deal that would promptscrutiny under this regime.415
A stricter approach would place prophylactic limits onvertical integration by platforms that have reached a certain level ofdominance. This would recognize that a platform's involvement across multiple relatedlines of business can give rise to conflicts of interest by creatingcircumstances in which a platform has an incentive to privilege its ownbusiness and disadvantage other companies.416 Seeking to prevent the industrystructures that create theseconflicts of interest may prove more effective than policing these conflicts.Adopting this prophylactic approach would mean banning a dominant firm fromentering any market that it already serves as a platform'--in other words, fromcompeting directly with the businesses that depend on it.417 In the case of Amazon, forexample, this prophylactic approach would prohibit the company from running both a dominant retail platform and adominant platform for third-party sellers. These two businesses would have tobe separated into different entities, in part to prevent Amazon from usinginsights from its role as a third-party host to benefit its retail business, asit reportedly does now.418
This form of prophylactic ban has a long history in bankinglaw.419 A core principle of banking law isthe separation of banking and commerce.420 ''U.S. commercial banks generally arenot permitted to conduct any activities that do not fall within . . . thestatutory concept of 'the business of banking.'''421 More specifically, theBank Holding Company Act of 1956 forbids firms that own or control a U.S. bankfrom engaging in business activities other than banking or managing banks.422 The main exception is thata bank that qualifies as a ''financial holding company'' ''may conduct broaderactivities that are 'financial in nature,' including securities dealing andinsurance underwriting.''423
The policy goals of this regime are worth reviewing becausethey have analogues in antitrust and competition policy. The mainjustifications for preserving the separation between banking and commerce have''included the needs to preserve the safety and soundness of insured depositoryinstitutions, to ensure a fair and efficient flow of credit to productive[businesses], and to prevent excessive concentration of financial and economicpower in the financial sector.''424All three concerns are linked to the fact that banks serve as critical intermediariesin our economy. The ''safety and soundness'' concern traces to the idea that ourbanking system is too vital to be subject to the risks of other businessactivities.425 The concern about fairnessand efficiency centers on the idea that allowing banks to be affiliated withcommercial companies may encourage banks to issue credit on the basis of howthose lending decisions will affect their commercial affiliates, therebydistorting competition. The practices this may trigger'--''price discrimination, unfairrestriction of access to credit, and other anticompetitive bankingpractices'''--would both ''hurt the individual commercial companies not affiliatedwith banks'' and undermine national ''productivity and growth.''426 Lastly, seeking ''theprevention of excessive concentration of economic . . . power'' among''large financial-industrial conglomerates'' recognizes that this market powertends to concentrate political power427 while also creatingsystemic dangers of ''too-big-to-fail'' conglomerates.428
Like bank holding companies, Amazon'--along with a few otherdominant platforms'--now play a crucial role in intermediating swaths of economicactivity. Amazon itself effectively controls the infrastructure of the interneteconomy. This level of concentrated control creates hazards analogous to thoserecognized in banking law. In light of this control, the conflicts of interestcreated through Amazon's expansion into distinct lines of business areespecially troubling. As in banking, enabling an essential intermediatingentity to compete with the companies that depend on it creates bad incentives.Allowing a vertically integrated dominant platform to pick and choose to whomit makes its services available, and on what terms, has the potential todistort fair competition and the economy as a whole.
The other two concerns'--safety and soundness, and excessiveeconomic and political power'--are also worth considering. It is true that Amazon(and other dominant platforms like Uber and Google)have extended directly into financial services.429 But its level ofinvolvement in these businesses, at least at the current scale, is unlikely toconcentrate financial risk in ways that warrant concern. Rather, the systemicrisks created by concentration among platforms are of a different kind. One involvesconcentration of data. That a huge share of consumer retail data may beconcentrated within a single company makes hacks of or technical failures bythat company all the more disruptive. The 2013 hack into Target's system'--as aresult of which up to 110 million consumers had personal information stolen430'--could have been orders ofmagnitude more disruptive had the hacked entity been Amazon. A few instanceswhere Amazon Web Services crashed led to disruptions for scores of otherbusinesses, including Netflix.431
Lastly, there is soundreason to ask whether permitting Amazon to leverage its platform to integrateacross business lines hands it undue economic and political power.432 While this subject invitesmuch deeper consideration than what this Note will provide, studiesinterviewing the host of businesses that now depend on Amazon'--retailers,manufacturers, publishers, to name a few'--reveal that the power it wields isacute.433 History suggests thatallowing a single actor to set the terms of the marketplace, largely unchecked,can pose serious hazards. Limiting Amazon's reach through prophylactic bans on vertical integration'--and thereby forcing it tosplit up its retail and Marketplace operation, for example'--would help mitigatethis concern.
B. Governing Dominant Platforms as Monopolies Through Regulation As described above, one option is to govern dominantplatforms through promoting competition, thereby limiting the power that anyone actor accrues. The other is to accept dominant online platforms as naturalmonopolies or oligopolies, seeking to regulate their power instead. In this Section,I sketch out two models for this second approach, traditionally undertaken inthe form of public utility regulations and common carrier duties. Industriesthat historically have been regulated as utilities include commodities (water,electric power, gas), transportation (railroads, ferries), and communications(telegraphy, telephones).434 Critically, a public utility regimeaims at eliminating competition: it accepts the benefits of monopoly andchooses instead to limit how a monopoly may use its power.435
Although largely out of fashion today, public utilityregulations were widely adopted in the early 1900s, as a way of regulating thetechnologies of the industrial age. Animating public utility regulations wasthe idea that essential network industries'--such as railroads and electricpower'--should be made available to the public in the form of universal serviceprovided at just and reasonable rates. The Progressive movement of the earlytwentieth century embraced public utility as a way to use government to steerprivate enterprise toward public ends. It was precisely because essentialnetwork industries often required scale that unregulated private control overthese sectors often led to abuse of monopoly power. Famously, the Interstate CommerceCommission'--which instituted a form of common carriage for railroads'--was createdpartly in response to the abusive conduct of railroads, whose control over anessential facility enabled them to pick winners and losers among farmers.436
In the United States, the first case applying public utilityregulations to a private business was Munnv. Illinois, in which the Supreme Court upheld state legislation establishingmaximum rates that companies could charge for the storage and transportation ofgrain.437 When one ''devotes hisproperty to a use in which the public has an interest, he, in effect, grants tothe public an interest in that use, and must submit to be controlled by thepublic for the common good,'' Chief Justice Waite wrote.438 ''[W]hen private propertyis devoted to a public use, it is subject to publicregulation.''439 While the decision usheredinto doctrine the principle of common carriers, the question of when a businesswas truly ''affected with the public interest'' was highly contested.440
Most importantly,''public utility was seen as a common, collective enterprise aimed at managing aseries of vital network industries that were too important to be left exclusivelyto market forces.''441 At the level of policy, publicutility regulations also enabled ''utilities to secure capital at lower cost andto channel it into very large technological systems,'' and thus was a way to''socialize the costs of building and operating'' a centralized system while''protecting consumers from the potential abuses associated with naturalmonopoly.''442
Given that Amazon increasingly serves as essentialinfrastructure across the internet economy, applying elements of public utilityregulations to its business is worth considering.443 The most common publicutility policies are (1) requiring nondiscrimination in price and service, (2)setting limits on rate-setting, and (3) imposing capitalization and investment requirements. Of these three traditionalpolicies, nondiscrimination would make the most sense, while rate-setting andinvestment requirements would be trickier to implement and, perhaps, would lessobviously address an outstanding deficiency.
A nondiscrimination policy that prohibited Amazon fromprivileging its own goods and from discriminating among producers and consumerswould be significant. Given that many of the most notable anticompetitiveconcerns around Amazon's business structure arise from its vertical integrationand the resulting conflicts of interest, applying a nondiscrimination schemewould curb the anticompetitive risk. This approach would permit the company tomaintain its involvement across multiple lines of business and permit it toenjoy the benefits of scale while mitigating the concern that Amazon couldunfairly advantage its own business or unfairly discriminate among platformusers to gain leverage or market power.444 Coupling nondiscriminationwith common carrier obligations'--requiring platforms to ensure open and fairaccess to other businesses'--would further limit Amazon's power to use itsdominance in anticompetitive ways.
Rate setting would be trickier. This would involve setting aceiling on the prices that Amazon can charge to both producers and consumers.Traditionally, governments used rate setting by identifying a ''fair return''that a company deserved for its investment, and then calculated consumer or producerprices accordingly.445But calculating ''fair return'' may prove more challenging in the online platformcontext than it did with traditional public utilities. One potential source ofdifficulty is that Amazon has invested so widely across such a range ofprojects that it is not clear which the government should peg to ''rate ofreturn.'' Another complicating factor is that part of Amazon's investment inthese platforms, so far, hasinvolvedlosing money through below-cost pricing.
Lastly, it is not clear that imposing capitalization andinvestment requirements would be necessary. A traditional reason for thesepolicies has been that that the economics of creating and running a utility canbe unfavorable, occasionally leading private companies to scrimp on investingand upkeep. In Amazon's case, the company is choosing to expand at a speed andscale that is pushing it into the red'--but it is not clear that the activity isintrinsically loss generating. That said, a public utility regime could also bejustified on the basis that succeeding as an online platform requires incurringheavy losses'--a model that Amazon and Uber have pursued.This approach would treat market-share chasing losses as a capital investment,446 suggesting the publicutility domain may be appropriate.
Practically, usheringin a public utility regime may prove challenging. Public utility regulationssuffered an intellectual and policy attack around mid-century. For one, criticschallenged the theory of natural monopoly as an ongoing rationale forregulation, arguing that rapid economic and technological change would rendermonopolies temporary problems. Second, critics portrayed public utility as aform of corruption, a system in which private industry executives colluded withpublic officials to enable rent seeking. Ultimately these lines of criticism substantiallythinned the very concept of public utility.447 The trend was part of abroader effort to idealize competitive markets and assume that noninterventionwas almost always superior to interference. Although the concept of publicutility regulation remains somewhat maligned today, there are signs that arobust movement to apply utility-like regulations to services that widelyregister as public'--such as the internet'--can catch wind. The core of the netneutrality debates, for example, involved foundational discussions about how toregulate the communication infrastructure of the twenty-first century.448 The net neutrality regimeultimately adopted falls squarely in the common carrier tradition.
Given Amazon's growing share of e-commerce as a whole, andthe vast number of independent sellers and producers that now depend on it,applying some form of public utility regulation could make sense. Nondiscriminationprinciples seem especially apt, given that conflicts of interest are a primaryhazard of Amazon's vertical power. One approach would apply public utility regulationsto all of Amazon's businesses thatserve other businesses. Another would require breaking up parts of Amazon andapplying nondiscrimination principles separately; so, for example, to AmazonMarketplace and Amazon Web Services as distinct entities. That said, given thepolitical challenges of ushering in such a regime, strengthening andreinforcing traditional antitrust principles may'--in the short run'--prove mostfeasible.
A lighter version of the regulatory approach would be toapply the essential facilities doctrine. This doctrine imposes sharingrequirements on a natural monopoly asset that serves as a necessary input in anothermarket. As Sandeep Vaheesan explains:
This doctrine rests on two basic premises: first, anatural monopolist in one market should not be permitted to deny access to thecritical facility to foreclose rivals in adjacent markets; second, the moreradical remedy of dividing the facility among multiple owners, while mitigatingthe threat of monopoly leveraging, could sacrifice important efficiencies.449
Unlike the prophylactic ban on integration, the essentialfacilities route accepts consolidated ownership. But recognizing that avertically integrated monopolist may deny access to a rival in an adjacent market,the doctrine requires the monopolist controlling the essential facility togrant competitors easy access. This duty has traditionally been enforcedthrough regulatory oversight.
While the essential facilities doctrine has not beenprecisely defined, the four-factor test enumerated by the Seventh Circuit in MCI Communications Corp. v. American Telephone& Telegraph Co. forms the basis of an essential facility claim today.450 Under that test, afacility is essential and must be shared if four conditions are met: (1) amonopolist controls the essential facility; (2) a competitor is unablepractically or reasonably to duplicate the essential facility; (3) themonopolist is denying use of the facility to a competitor; and (4) providingthe facility is feasible.451The MCI court also held that, inorder to be deemed essential, the facility must be a ''necessary input in a distinct, vertically related market.''452
While the Supreme Court has never recognized nor articulateda standard for ''essential facility,'' three Supreme Court rulings ''are seen ashaving established the functional foundation'' for the doctrine.453 In 2004, however, theCourt disavowed the essential facilities doctrine in dicta,454 leading severalcommentators to wonder whether it is a dead letter.Thisdecision by the Court to effectively reject its prior case law on essentialfacilities followed challenges on other fronts: notably from Congress,enforcement agencies, and academic scholars, all of whom have critiqued theidea of requiring dominant firms to share their property.455
Treating aspects of Amazon's business as ''essentialfacilities'' seems appropriate, given that factors two, three, and four of the MCI test are likely to hold for at leastone line of business. The first factor'--whether Amazon is a ''monopolist'''--issubject to the risk that doctrine takes an excessively narrow view of whatconstitutes a ''monopolist,'' a definition that may be especially out of touchwith dominance in the internet age.
Essential facilities doctrine has traditionally been appliedto infrastructure such as bridges, highways, ports, electrical power grids, andtelephone networks.456Given that Amazon controls key infrastructure for e-commerce, imposing a dutyto allow access to its infrastructure on a nondiscriminatory basis make sense. Andin light of the company's current trajectory, we can imagine at least threeaspects of its business could eventually raise ''essential facilities''-likeconcerns: (1) its fulfillment services in physical delivery; (2) itsMarketplace platform; and (3) Amazon Web Services. While the essentialfacilities doctrine has not yet been applied to the internet economy, someproposals have started exploring what this might look like.457 Pursuing this regime foronline platforms could maintain the benefits of scale while preventing dominantplayers from abusing their power.
conclusion Internet platforms mediate a large and growing share of ourcommerce and communications. Yet evidence shows that competition in platformmarkets is flagging, with sectors coalescing around one or two giants.458 The titan in e-commerce isAmazon'--a company that has built itsdominance through aggressively pursuing growth at the expense of profits andthat has integrated across many related lines of business. As a result, the company has positioned itself at thecenter of Internet commerce and serves as essential infrastructure for a host ofother businesses that now depend on it. This Note argues that Amazon's businessstrategies and current market dominance pose anticompetitive concerns that the consumerwelfare framework in antitrust fails to recognize.
In particular, current law underappreciates the risk ofpredatory pricing and how integration across distinct business lines may proveanticompetitive. These concerns are heightened in the context of onlineplatforms for two reasons. First, the economics of platform markets incentivizethe pursuit of growth over profits, a strategy that investors have rewarded.Under these conditions predatory pricing becomes highly rational'--even asexisting doctrine treats it as irrational. Second, because online platformsserve as critical intermediaries, integrating across business lines positionsthese platforms to control the essential infrastructure on which their rivalsdepend. This dual role also enables a platform to exploit information collectedon companies using its services to undermine them as competitors.
In order to capture these anticompetitive concerns, we shouldreplace the consumer welfare framework with an approach oriented aroundpreserving a competitive process and market structure. Applying this ideainvolves, for example, assessing whether a company's structure createsanticompetitive conflicts of interest; whether it can cross-leverage marketadvantages across distinct lines of business; and whether the economics ofonline platform markets incentivizes predatory conduct and capital marketspermit it. More specifically, restoring traditional antitrust principles tocreate a presumption of predation and to ban vertical integration by dominantplatforms could help maintain competition in these markets. If, instead, weaccept dominant online platforms as natural monopolies or oligopolies, thenapplying elements of a public utility regime or essential facilitiesobligations would maintain the benefits of scale while limiting the ability ofdominant platforms to abuse the power that comes with it.
My argument is part of a larger recent debate about whetherthe current paradigm in antitrust has failed. Though relegated to technocratsfor decades, antitrust and competition policy have once again become topics ofpublic concern.459 Last year, the Wall Street Journal reported that ''[a] growing number of industriesin the U.S. are dominated by a shrinking number of companies.''460 In March 2016, the Economist declared, ''Profits are toohigh. America needs a dose of competition.''461 Policy elites, too, haveweighed in, issuing policy papers and hosting conferences documenting thedecline of competition across the U.S. economy and assessing the resulting harms,including a drop in start-up growth and widening economic inequality.462 Antitrust even made itinto the 2016 presidential campaign: Democrats included competition policy intheir party platform for the first time since 1988, and in October of the sameyear, presidential candidate Hillary Clinton released a detailed antitrust platform,highlighting not only a need for more vigorous enforcement but for anenforcement philosophy that takes into account market structure.463
Animating these critiques is not a concern about harms toconsumer welfare,464but the broader set of ills and hazards that a lack of competition breeds. AsAmazon continues both to deepen its existing control over key infrastructure andto reach into new lines of business, its dominance demands the same scrutiny. Torevise antitrust law and competition policy for platform markets, we should beguided by two questions. First, does our legal framework capture the realitiesof how dominant firms acquire and exercise power in the internet economy? Andsecond, what forms and degrees of power should the law identify as a threat to competition?Without considering these questions, we risk permitting the growth of powers thatwe oppose but fail to recognize.
Opinions | The threat to democracy '-- from the left
Fri, 14 Sep 2018 04:01
(C) Susan Walsh/AP Stephen K. Bannon speaks during the Conservative Political Action Conference in Oxon Hill in 2017. Editor's note: The opinions in this article are the author's, as published by our content partner, and do not necessarily represent the views of MSN or Microsoft.
For several years now, scholars have argued that the world is experiencing a ''democratic recession.'' They have noted that the movement of countries toward democracy has slowed or stopped and even, in some places, reversed. They also note a general hollowing out of democracy in the advanced, industrial world. When we think about this problem, inevitably and rightly we worry about President Trump, his attacks on judges, the free press and his own Justice Department. But there is also a worrying erosion of a core democratic norm taking place on the left.
It has become commonplace to hear cries on the left to deny controversial figures on the right a platform to express their views. Colleges have disinvited speakers such as Condoleezza Rice and Charles Murray. Other campuses were unwilling or unable to allow conservative guests to actually speak, with protests overwhelming the events.
A similar controversy now involves Stephen K. Bannon, who, in recent months, has been making the rounds on the airwaves and in print '-- including an interview I did with him on CNN. Some have claimed that Bannon, since leaving the administration, is simply unimportant and irrelevant and thus shouldn't be given a microphone. But if that were the case, surely the media, which after all is a for-profit industry, would notice the lack of public interest and stop inviting him.
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The reality is that the people running the Economist, the Financial Times, ''60 Minutes,'' the New Yorker and many other organizations that have recently sought to feature Bannon know he is an intelligent and influential ideologist, a man who built the largest media platform for the new right, ran Trump's successful campaign before serving in the White House, and continues to articulate and energize the populism that's been on the rise throughout the Western world. He might be getting his 15 minutes of fame that will peter out, but, for now, he remains a compelling figure.
The real fear that many on the left have is not that Bannon is dull and uninteresting, but the opposite '-- that his ideas, some of which can reasonably be described as evoking white nationalism, will prove seductive and persuasive to too many people. Hence his detractors' solution: Don't give him a platform, and hope that this will make his ideas go away. But they won't. In fact, by trying to suppress Bannon and others on the right, liberals are likely making their ideas seem more potent. Did the efforts of communist countries to muzzle capitalist ideas work?
Liberals need to be reminded of the origins of their ideology. In 1859, when governments around the world were still deeply repressive '-- banning books, censoring commentary and throwing people in jail for their beliefs '-- John Stuart Mill explained in his seminal work, ''On Liberty,'' that protection against governments was not enough: ''There needs protection also against the tyranny of the prevailing opinion and feeling; against the tendency of society to impose .'.'. its own ideas and practices .'.'. on those who dissent from them.'' This classic defense of free speech, which Supreme Court Justice Oliver Wendell Holmes later called the ''freedom for the thought that we hate,'' is under pressure in the United States '-- and from the left.
We've been here before. Half a century ago, students were also shutting down speakers whose views they found deeply offensive. In 1974, William Shockley, the Nobel Prize-winning scientist who in many ways was the father of the computer revolution, was invited by Yale University students to defend his abhorrent view that blacks were a genetically inferior race who should be voluntarily sterilized. He was to debate Roy Innis, the African American leader of the Congress of Racial Equality. (The debate was Innis's idea.) A campus uproar ensued, and the event was canceled. A later, rescheduled debate with another opponent was disrupted.
The difference from today is that Yale recognized that it had failed in not ensuring that Shockley could speak. It commissioned a report on free speech that remains a landmark declaration of the duty of universities to encourage debate and dissent. The report flatly states that a college ''cannot make its primary and dominant value the fostering of friendship, solidarity, harmony, civility or mutual respect. .'.'. it will never let these values .'.'. override its central purpose. We value freedom of expression precisely because it provides a forum for the new, the provocative, the disturbing, and the unorthodox.''
The report added: ''We take a chance, as the First Amendment takes a chance, when we commit ourselves to the idea that the results of free expression are to the general benefit in the long run, however unpleasant they may appear at the time.'' It is on this bet for the long run, a bet on freedom '-- of thought, belief, expression and action '-- that liberal democracy rests.
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