A Judge Said Federal Officers Can’t Arrest Or Use Force Against Journalists In Portland

The new 14-day temporary restraining order, which the Trump administration opposed, represents the first court order placing limits on the federal law enforcement action in Portland.

Chad Wolf: Acting Secretary of Homeland Security

Chad F. Wolf is the acting Secretary of Homeland Security and Under Secretary of Homeland Security for Strategy, Policy, and Plans. He previously served in several positions in the Department of Homeland Security (DHS), including as Chief of Staff of the Transportation Security Administration and Chief of Staff to DHS secretary Kirstjen Nielsen. He was an architect of the Trump administration’s family separation policy.

From 2005 to 2016, he was a lobbyist, helping clients to secure contracts from the Transportation Security Administration, his previous employer.

Education and early career

Wolf is originally from Plano, Texas.[2] He graduated from Plano East Senior High School and then attended Collin College on a tennis scholarship.[3] Wolf then earned a B.S. in U.S. history from Southern Methodist University.

He worked as a staffer for Republican Senators Phil GrammKay Bailey Hutchison, and then Chuck Hagel, for whom he worked for two and a half years.[3][4][5] From 2002 to 2005, Wolf worked in the Transportation Security Administration (TSA), becoming Assistant Administrator for Transportation Security Policy in 2005.[4][5] From October 2005 to 2016, he was Vice President and Senior Director at Wexler & Walker,[4][5] a now-defunct lobbying firm.[6][7][2] He helped clients obtain contracts from the TSA, his previous employer.[8]

In 2013 he received a Master Certificate in Government Contract Management from Villanova University.[4]

Return to Department of Homeland Security

In March 2017 Wolf became Chief of Staff of the Transportation Security Administration.[2][4]

In 2018 he became Chief of Staff of DHS under Secretary Kirstjen Nielsen.[4] While working for Nielsen, he was an early architect of the family separation policy.[6] He later testified to Congress that his function was to provide information to the Secretary and “not to determine whether it was the right or wrong policy,”[6] though he agreed with the decision to end the policy.[9] He also testified that he was not involved in the initial development of the policy by the Executive Office of the President and the Attorney General, though this statement was disputed based on internal documents.[10]

He then became Assistant Secretary of Homeland Security for Strategy, Plans, Analysis & Risk,[4] a Senior Executive Service position not subject to Senate confirmation.[11] He concurrently served as Acting Under Secretary of Homeland Security for Strategy, Policy, and Plans.[4] He was nominated in February 2019 to serve permanently in the Under Secretary role,[12] and his confirmation hearing was held that June,[6] but the nomination was delayed by Senator Jacky Rosen to protest poor conditions for children at DHS facilities.[13]

Wolf briefs the White House press corps on the COVID-19 pandemic in March 2020

Wolf’s appointment as Acting Secretary of Homeland Security came after the departure of Kevin McAleenan was announced on November 1, 2019.[14] The fact that he had previously lobbied for the National Association of Software and Services Companies, which was in favor of the H-1B visa program, led to criticism from groups favoring more restrictive immigration policies,[12][15] but the Trump administration defended his record[6] and privately asked Republican senators not to oppose his appointment.[16]

The administration waited for Wolf’s confirmation as Under Secretary before appointing him to the Acting Secretary role,[17] to avoid appointing him as a principal officer from a non-Senate-confirmed position, which many scholars and former government officials have argued is unconstitutional.[14][18][19] DHS then had to move the Under Secretary position earlier in the line of succession, because the 210-day period in which an acting official may be named without a pending permanent nomination had expired, mandating that the duties of the Secretary must be performed by the department’s seniormost confirmed official.[17][20]

Wolf was confirmed as Under Secretary on November 13, 2019 on a 54–41 vote,[21] and was sworn in as acting Secretary of Homeland Security the same day.[22] On November 15, House Democrats Bennie Thompson and Carolyn Maloney requested that the Comptroller General of the United States review the legality of Wolf’s appointment on the basis that former Acting Secretary McAleenan did not have authority to change the department’s line of succession, asserting that former Secretary Nielsen had not properly placed McAleenan first in the line of succession before resigning, and additionally that McAleenan’s change came after the 210-day limit to his authority had expired.[9][23][24]

In February 2020, Wolf announced that the Trump administration was revoking New York residents’ ability to participate in Global Entry and other Trusted Traveler programs, in response to the state’s “sanctuary” immigration policies, which jeopardized the government’s ability to effectively vet travelers.[25][26][27] The move prompted the State of New York to sue the administration.[26]

In July 2020, Wolf sent federal agents dressed in camouflage and tactical gear to Portland, Oregon, where the agents used tear gas on protestors and pulled protestors into unmarked vehicles.[28] The agents did not have obvious marking or identification.[28] In the past, far-right militias had worn camouflage and tactical gear in clashes with other protestors in Portland, which sowed confusion.[28] Oregon Governor Kate Brown described the action as “abuse of power,” and accused Wolf of “provoking confrontation for political purposes.”[28] Portland mayor Ted Wheeler said it was “an attack on our democracy.”[28] Wolf said the protestors were a “violent mob” and “violent anarchists.”[28][29][30] The New York Times reported that an internal DHS memo had been presented to Wolf which said prior to the deployment that the federal agents in question had not been specifically trained in riot control or mass demonstrations.[31]

Personal life

Wolf is married and has two sons.[32]

Bill Barr Should Have Lost His Job This Weekend

The attorney general undermined the rule of law by forcing out Geoffrey Berman, the United States attorney in Manhattan.

President Trump has long made clear that, for him, “rule of law” is a limited-utility slogan. By word and deed, he has demonstrated his belief that the law exists to serve him, personally and politically.

He has pressured individuals and institutions to pervert their usual independent government missions to comply with a mandate of pure self-interest to protect the president and his friends and pursue the president’s adversaries. This explains Mr. Trump’s ire at his former attorney general, Jeff Sessions, for recusing himself from the Russia investigation; recusal made the protection part of the mandate harder to accomplish.

It also explains the president’s conduct at the heart of impeachment — using the diplomatic and financial levers of government to coerce Ukraine into announcing a damaging investigation of Joe Biden, his chief political rival. The episode is what the former Russia adviser Fiona Hill disparagingly referred to in her testimony as “a domestic political errand.”

Mr. Trump’s latest domestic political errand involves the office I led for almost eight years — the United States Attorney’s Office for the Southern District of New York in Manhattan, commonly known as S.D.N.Y., a place where politics is supposed to be off limits. The United States attorney, Geoffrey Berman, was fired on Saturday in a manner and under circumstances that warrant criticism and scrutiny.

To understand the uproar over the termination in legal circles, some context helps. S.D.N.Y. is famously and proudly independent. It embraces its nickname, the “Sovereign District of New York,” as a badge of honor. Sovereign, in the understanding of those who have served there, does not mean rogue. It signifies respect for law and scorn for political considerations. Republicans and Democrats are equally in the cross hairs.

The career lawyers are hired without knowledge of their politics or ideology. Mary Jo White, the U.S. attorney who hired me to be a prosecutor, opened an investigation of Bill Clinton, the president who appointed her, after he pardoned the fugitive financier Marc Rich. Such independent action would seem beyond this president’s comprehension.

That same commitment to independence is why I did not return President Trump’s unusual phone call to me in March 2017, after which he fired me.

The importance of reputational independence isn’t codified in a rule or a statute, but it is rightly embedded in the DNA of any worthy law enforcement institution for a simple reason: That independence gives comfort to the public that decisions about life and liberty will not be influenced by politics or partisan interests, that those decisions will not depend on an individual’s identity, wealth, fame, power or closeness to a president — every judgment rendered without fear or favor, as the oath commands.

It is this independence, and the public’s faith therein, that Attorney General Bill Barr, in cahoots with President Trump, threatened with his dubious, if legal, removal of Mr. Berman.

What prompted the termination? We don’t know and neither Mr. Barr nor President Trump has publicly said. Mr. Berman is a registered Republican, donated to the Trump campaign and was personally interviewed by the president. There has been no suggestion of impropriety or incompetence.

Against that backdrop, the only sin ascribable to S.D.N.Y. under Mr. Berman’s leadership, it seems, is violation of the commandment to protect the president’s friends and pursue his rivals. The president was unhappy with how the case against his former personal lawyerMichael Cohen, was handled. The president was displeased that his handpicked U.S. attorney, Mr. Berman, removed himself from the case, unable to protect Mr. Trump from being incriminated in open court.

Then there is the reported continuing investigation of the president’s other personal lawyer, Rudolph Giuliani, a former law partner of Mr. Berman. Perhaps that was a bridge too far.

Maybe it had something to do with Turkey. According to John Bolton’s new book, in connection with a case involving the Turkish bank Halkbank in S.D.N.Y. that the Turkish president, Recep Tayyip Erdogan, didn’t like, Mr. Trump told the Turkish leader that the “Southern District prosecutors were not his people.”

I don’t know if any of these matters, individually or in combination, provoked the firing. It may be impossible to know.

But given the president’s track record, the absence of any other articulated reason and the peculiarity of the weekend termination, neither Mr. Trump nor Mr. Barr deserves much benefit of the doubt. Nothing about the weekend termination was regular or in good faith. It smacks of an effort to get rid of someone perceived to be disloyal in favor of someone more controllable. It may be legal, but it does not clothe the attorney general, or the department he leads, in honor.

It began with Mr. Barr declaring that the chairman of the Securities and Exchange Commission, Jay Clayton, would be nominated by the president to be the next head of S.D.N.Y., a somewhat odd choice. Mr. Clayton has never been a prosecutor and never worked in S.D.N.Y. (as has every other U.S. attorney going back two generations). The timing of the announcement, during the traditional news graveyard of Friday night, was further suspect.

More important, Mr. Barr, in a pro forma note of appreciation, thanked Mr. Berman for his service and said he was “stepping down” after two and a half years in the prosecutor’s office. The second part of that statement was an apparent lie. As Mr. Berman said in his own release later the same night, “I have not resigned, and I have no intention of resigning.”

In my experience, government officials don’t lie about the intentions of others when they are acting in good faith. Perhaps the attorney general thought Mr. Berman would be too cowed to contradict a pre-emptive public announcement of resignation. He was wrong. The next day, Mr. Barr sent a letter to Mr. Berman advising him the president had fired him (though Mr. Trump added to confusion and irregularity later in the day by saying, “I was not involved.”).

Forcing out a well-performing U.S. attorney of the same party, without explanation, on the eve of election, in favor of a less qualified candidate who golfs with the president (as Mr. Clayton does), in the midst of investigations known to be irksome to the president, does not reflect a commitment to law enforcement independence.

Within the Department of Justice, hardworking public servants — in the Southern District of New York and elsewhere — are angry, dismayed and demoralized. I’ve spoken to many of them this weekend. They are disheartened by the bad faith of Bill Barr and his determined efforts to undermine prosecutorial independence. On Saturday, finally assured his well-regarded and principled deputy, Audrey Strauss, would take over the reins, Mr. Berman left S.D.N.Y. with his head held high.

I believe the wrong Department of Justice official left office that day.

Who were those guys on Elizabethtown roofs?

If armed militia groups are going to give themselves permission to “police” local Black Lives Matter demonstrations, as they did in downtown Elizabethtown on June 6, I think it’s important to know a little more about them.

One of the groups in Elizabethtown — the Carlisle Light Infantry — claims to be the direct descendant of the Carlisle Light Infantry that marched with George Washington against the Whiskey Rebellion in western Pennsylvania and fought for the Union in the Civil War.

The other, now calling itself the Domestic Terrorism Response Organization, identified itself as “Anti ANTIFA” on a newly created Facebook page June 1, but changed to Domestic Terrorism Response Organization shortly after President Donald Trump declared the loosely organized American anti-fascist movement to be a domestic terror group.

The president’s attempt to avoid addressing concerns about police brutality expressed across the country failed miserably. Under U.S. law, the federal government can only “deem entities terrorists and impose sanctions on them” if they’re from another country, according to The New York Times on June 10.

Elizabethtown police Chief Edward Cunningham told LNP | LancasterOnline that he “became aware” on the night of June 5 that some shop owners had arranged their own security, but said he didn’t invite the militia groups or approve their plans. Apparently, borough Councilman Bill Troutman didn’t either. Nearly a week later, he was still demanding to know “who put those people on the roof,” according to LNP | LancasterOnline.

One gunman told LNP | LancasterOnline his name is Niels Norby Jr. and stated “I was there to protect everybody” — store owners, police and protesters.

The Domestic Terrorism Response Organization members present in Elizabethtown apparently offered no explanation for their presence there. “Anti-antifa” — a name it previously used on Facebook — is a term that has been coined by and linked to some white supremacist groups, according to the Anti-Defamation League.

The Carlisle Light Infantry, in its modern incarnation, describes itself on its website (carlislelightinfantry.com) as “the living, breathing, operational element of the 2nd Amendment as defined by the signers of the constitution of the United States as ‘a well regulated militia.’ ”

Asserting to be the revitalized progeny of the Colonial-era Carlisle militia, the current leaders explain on their website why they had to get the unit back up and running. Following are direct and unedited quotes: “We live in a time where we as citizens are apprehensive, even afraid of our uniformed officers. We’re doubtful and suspicious of our local elected officials. We’re convinced that our leaders do not have our best interests, our families and livelihoods, in mind as they make decisions that effect every aspect of our daily lives. We live in a time when our open arms to the world and it’s many peoples and cultures invites risk and harm to our own. We therefore live in a time where it’s our personal and civic duty to stand up for what’s right, and protect what matters most.”

Despite its assertion that “we do not, and will not, discriminate against anyone,” there is not one black or brown face in the several group photos posted its website. Put all of that together and you come up with what sounds to me like another white nationalist group intent on imposing its jaundiced view of 21st-century American society on communities (as it did in Elizabethtown on June 6), whether we ask for it or not.

Shocking as it is to view photos of these people brandishing their weapons on the rooftops of downtown Elizabethtown, it really is nothing new. Militia members essentially threatened to lynch Michigan Gov. Gretchen Whitmer last month to express their displeasure with restrictions imposed to protect them from the deadly coronavirus.

But they go much further back than that. I met these disaffected Americans years ago when I was reporting in Michigan, Indiana and upstate New York. Like the Carlisle group, they called themselves “real” patriots. Those I met had lost faith in this country and its institutions, including the political system, the police and the military. Like the Carlisle Light Infantry, those militia members lived in fear; for them it was fear of a one-world government, secret messages on the back of road signs and black helicopters on the horizon.

For the Carlisle Light Infantry, it’s — in my view — fear of people of color, immigrants, diversity and a world not dominated by white people.

I felt sad talking to those militia groups back then, and the same sadness washes over me as I listen to these militia groups today. Their members seem so desperate that they’re willing to take up arms against their fellow citizens.

Back then, I tended to write these folks off as an insignificant splinter of the American body politic. But I don’t think we can ignore them anymore. They have a president who seemingly encourages them to take the law into their own hands and who shows no signs of understanding the traumatic experiences of any Americans, black or white.

Notice that today’s militia members seemingly express no sense of identifying with the struggle for racial equality and justice now sweeping across our country. It was a peaceful desire to support Black Lives Matter that triggered the protest in Elizabethtown on June 6. But the Domestic Terrorism Response Organization and the Carlisle Light Infantry didn’t come for that. They stood with trigger fingers at the ready — an intimidating, self-appointed presence — apparently prepared to take out anyone who crossed whatever lines they drew for acceptable behavior during a demonstration against police brutality.

Although the Carlisle Light Infantry puts in a lot of time drilling, these members are not trained police officers. Thank God the day did not end in tragedy. But the challenge posed by these groups did not end at sundown in Elizabethtown. A civil society cannot allow violence or the threat of violence to usurp the rule of law.

These are tragically disappointed people, gripped by fear and a mindset that will lead to nothing good. We must invite them back into the community dialogue now — for their sake and ours. There’s no better time than the present.

 

 

Cutting through the Green Tape: Who called the militia to ‘protect’ during Elizabethtown Protest

 

Trump and Barr Are Out of Control

The prosecutor who quit over the Roger Stone sentencing is sending a powerful message about political weaponization.

The resignation of a Justice Department prosecutor over the sentencing of Roger Stone is a major event. The prosecutor, Jonathan Kravis, apparently concluded that he could not, in good conscience, remain in his post if the department leadership appeared to buckle under White House pressure to abandon a sentencing recommendation in the case of Mr. Stone, the associate of President Trump who was convicted of obstructing a congressional inquiry into Russian meddling in the 2016 election.

Three of his colleagues quit the Stone case but remain with the department: Mr. Kravis left altogether. Even though the president for years has derided federal law enforcement officials, accusing them variously of conflicts of interest and criminality and weakness in not pursuing prosecution of his political opposition, Mr. Kravis’s is the first resignation in the face of these assaults.

Dramatically forceful responses to Mr. Trump’s assaults on rule-of-law norms have been all too rare. A resignation can set off an alarm bell for an institution whose failings an official might be unable to bring to light in no other way, or as effectively. It upholds rule of law norms in the very act of signaling that they are failing. It makes its point with power and transparency, and stands a chance of rallying support from those who remain in place and compelling other institutions like the press and Congress to take close notice.

The government official who resigns for these reasons is, paradoxically, doing his or her job by leaving it.

Why did the Stone matter so clearly warrant resignation? The president has used Twitter to denounce and pressure department officials, senior administration lawyers and the Mueller team. When he did that to Attorney General Jeff Sessions, his deputy attorney general, Rod Rosenstein, and the special counsel Robert Mueller, they stuck it out. They must have thought that the best way to serve the rule of law was to hold off or humor the president, maintaining regular order as much as possible even as Mr. Trump raged that he could not fully control his department.

And there is a case to make for their choice. Mr. Sessions stood up to the president and adhered to his decision to recuse himself from the Russia investigation. Mr. Mueller was not fired and completed his investigation in the Russia matter.

But this time, the president got what he wanted. Mr. Trump attacked the department sentencing recommendation as an unacceptable “miscarriage of justice” that was “horrible and unfair.” And then the department did switch positions on the sentencing, criticizing its own prosecutors for failing to be “reasonable” in their recommendation to the court.

This, then, could be seen as the extreme case, whereas normally a lawyer might decide that “working from the inside” is the best, most responsible answer to the president’s behavior.

Still, if resignation had been seen earlier as viable, even necessary option, it’s possible that we would not have arrived at this point. Mr. Sessions could have resigned over the president’s public calls for him to ignore his recusal requirements or prosecute Hillary Clinton. If Mr. Mueller had resigned over the president’s attacks on him and refusal to sit for an interview, he might not have completed his report but he would have rendered a devastating and unequivocal judgment. And, without a report he felt compelled to rely on, Mr. Mueller might have felt himself more at liberty to testify in detail to Congress.

Resignation, while an act of professional conscience, can be effective in pushing back against violations of norms of impartial, professional law enforcement insulated from political pressure. According to the Mueller report, having been finally pushed too far, the White House counsel Don McGahn threatened to resign in June 2017 over Mr. Trump’s directive to fire Mr. Mueller. What did the president do? He backed down.

That was then. Mr. Trump has established a new normal at the senior legal leadership of his administration. The rhetoric of Mr. Sessions’s successor, William Barr, suggests that he accepts, to a disturbing degree, the president’s desire for a politically responsive Justice Department. Mr. McGahn’s successor, Pat Cipollone, defended the president in the impeachment proceeding with arguments of the kind, in tone and variance from the factual record, you would expect to hear from Trump surrogates on Fox News.

We can’t know if a wave of resignations early in this administration would have made a difference in preventing or tempering the unfortunate appearance, and perhaps increasing reality, that the administration of justice is being politicized. During the Watergate scandal, the Saturday Night Massacre resignations by Justice Department leaders certainly made an impression on President Richard Nixon, who then appointed an effective independent prosecutor, Leon Jaworski.

Resignations can be a shock to the system, just what is needed to clarify the issues, force Congress to pay attention and alter a president’s behavior.

What government lawyers are prepared to accept, the conditions under which they are willing to work, still matters. Institutions can be severely damaged in one huge blow or whittled away.

Of course, resignation as an act of protest is not a choice to be lightly made by those who join an administration and find themselves in disagreement with the president. It is not justified by policy decisions that a subordinate official would have made differently.

But the president should not be able to command this loyalty when the conflict concerns something as fundamental as the professionalism and independence of the Justice Department — and involves a case in which the president has a direct personal interest and the defendant is a political associate.

For senior administration lawyers to just manage these kinds of conflict — ignoring Mr. Trump’s tweets and disregarding his inappropriate if not unlawful presidential orders — allows the abnormal to become normal and professional standards to crumble.

The prosecutor who resigns rather than remain in a decaying institution is upholding crucial norms. To his credit, at least one lawyer has chosen to do this, even if it is the rare case and it may have come too late to protect the Department of Justice from Mr. Trump’s demands and Attorney General Barr’s apparent willingness to accommodate them.

Trump the Intimidator Fails Again

Because he’s just a bully with delusions of grandeur.

International crises often lead, at least initially, to surging support for a country’s leadership. And that’s clearly happening now. Just weeks ago the nation’s leader faced public discontent so intense that his grip on power seemed at risk. Now the assassination of Qassim Suleimani has transformed the situation, generating a wave of patriotism that has greatly bolstered the people in charge.

Unfortunately, this patriotic rallying around the flag is happening not in America, where many are (with good reason) deeply suspicious of Donald Trump’s motives, but in Iran.

In other words, Trump’s latest attempt to bully another country has backfired — just like all his previous attempts.

From his first days in office, Trump has acted on the apparent belief that he could easily intimidate foreign governments — that they would quickly fold and allow themselves to be humiliated. That is, he imagined that he faced a world of Lindsey Grahams, willing to abandon all dignity at the first hint of a challenge.

But this strategy keeps failing; the regimes he threatens are strengthened rather than weakened, and Trump is the one who ends up making humiliating concessions.

Remember, for example, when Trump promised “fire and fury” unless North Korea halted its nuclear weapons program? He claimed triumph after a 2018 summit meeting with Kim Jong-un, North Korea’s leader. But Kim made no real concessions, and North Korea recently announced that it might resume tests of nuclear weapons and long-range missiles.

Or consider the trade war with China, which was supposed to bring the Chinese to their knees. A deal has supposedly been reached, although details remain scarce; what’s clear is that it falls far short of U.S. aims, and that Chinese officials are jubilant about their success in facing Trump down.

Why does Trump’s international strategy, which might be described as winning through intimidation, keep failing? And why does he keep pursuing it anyway?

One answer, I suspect, is that like all too many Americans, Trump has a hard time grasping the fact that other countries are real — that is, that we’re not the only country whose citizens would rather pay a heavy price, in money and even in blood, than make what they see as humiliating concessions.

Ask yourself, how would Americans have reacted if a foreign power had assassinated Dick Cheney, claiming that he had the blood of hundreds of thousands of Iraqis on his hands? Don’t answer that Suleimani was worse. That’s beside the point. The point is that we don’t accept the right of foreign governments to kill our officials. Why imagine that other countries are different?

Of course, we have many people in the diplomatic corps with a deep knowledge of other nations and their motivations, who understand the limits of intimidation. But anyone with that kind of understanding has been excluded from Trump’s inner circle.

Now, it’s true that for many years America did have a special leadership position, one that sometimes involved playing a role in reshaping other countries’ political systems. But here’s where Trump’s second error comes in: He has never shown any sign of understanding why America used to be special.

Part of the explanation, of course, was raw economic and military power: America used to be just much bigger than everyone else. That is, however, no longer true. For example, by some key measures China’s economy is significantly bigger than that of the United States.

Even more important, however, was the fact that America was something more than a big country throwing its weight around. We always stood for something larger.

That doesn’t mean that we were always a force for good; America did many terrible things during its reign as global hegemon. But we clearly stood for global rule of law, for a system that imposed common rules on everyone, ourselves included. The United States may have been the dominant partner in alliances like NATO and bodies like the World Trade Organization, but we always tried to behave as no more than first among equals.

Oh, and because we were committed to enforcing rules, we were also relatively trustworthy; an alliance with America was meaningful, because we weren’t the kind of country that would betray an ally for the sake of short-term political convenience.

Trump, however, has turned his back on everything that used to make America great. Under his leadership, we’ve become nothing more than a big, self-interested bully — a bully with delusions of grandeur, who isn’t nearly as tough as he thinks. We abruptly

  • abandon allies like the Kurds;
  • we honor war criminals; we
  • slap punitive tariffs on friendly nations like Canada for no good reason. And, of course,
  • after more than 15,000 lies, nothing our leader and his minions say can be trusted.

Trump officials seem taken aback by the uniformly negative consequences of the Suleimani killing: The Iranian regime is empowered, Iraq has turned hostile and nobody has stepped up in our support. But that’s what happens when you betray all your friends and squander all your credibility.

If Wealth Is Justified, so Is a Wealth Tax

Not surprisingly, American billionaires have dismissed recent wealth-tax proposals as an affront to the entrepreneurial spirit to which they attribute their massive wealth. But the ultra-rich never would have their great wealth without legal subsidies from the state and reliable enforcement by the courts.

NEW YORK – Economic inequality has moved to the top of the political agenda in many countries, including free-market poster children like the United States and the United Kingdom. The issue is mobilizing the left and causing headaches on the right, where wealth has long been viewed as worthy of celebration, not as demanding justification.

But today’s concentrations of wealth do demand justification. In 2018, Forbes listed three billionaires among its top ten most powerful people in the world. Next to the heads of states of Chinese President Xi Jinping, Russian President Vladimir Putin, US President Donald Trump, and German Chancellor Angela Merkel, one finds not only the Pope, but also Amazon founder Jeff Bezos, Microsoft co-founder Bill Gates, and Google co-founder Larry Page. All three owe their power not to public position or spiritual influence but to private wealth.

As contenders in the Democratic primary for the 2020 US presidential election, Senator Bernie Sanders of Vermont and Senator Elizabeth Warren of Massachusetts have promised to impose new taxes on the super-wealthy. Warren’s wealth-tax proposal – a levy of 2% on every dollar of net worth above $50 million, rising to 6% for fortunes greater than $1 billion – has ruffled billionaires’ feathers. According to Gates, he has paid more in taxes than almost anybody – some $10 billion. And while he would consider it “fine” if that figure had been doubled to $20 billion, he believes a much higher tax would threaten the incentive system that led him (and others) to invest in the first place.

For his part, Michael Bloomberg, the founder of the Bloomberg news empire, a former mayor of New York City, and now a Democratic presidential contender himself, argues that a wealth tax might be unconstitutional, and that it would turn the US into the likes of Venezuela. And not to be outdone, Facebook founder and CEO Mark Zuckerberg has suggested that taxing billionaires’ wealth would lead to worse outcomes than leaving it where it is, implying that the ultra-wealthy know better than the peoples’ elected representatives how tax revenues should be spent.

Note the sense of entitlement underlying each of these reactions. Each man’s billions, we are told, belong to him; he earned the money and should therefore get to decide how to spend it, be it on philanthropic projects, taxes, or neither. The billionaires tell us that they are willing to pay a fair share of taxes, but that there is some undefined threshold where the incentives to innovate and invest will be thrown into reverse. At that point, apparently, the ultra-wealthy will go on strike, leaving the rest of us worse off.

But this perspective ignores the fact that accumulated wealth is largely a product of law, and by implication of the state and the people who constitute it. As economist Thomas Piketty demonstrates in his 2014 book, Capital in the Twenty-First Century, the rich today hold most of their wealth in financial assets, which are simply legally protected promises to receive future cash flows. Take away legal enforceability, and all that remains is hope, not a secure asset.

Moreover, the private empires over which today’s billionaires preside are organized as legally chartered corporations, which makes them creatures of the law, not of nature. The corporate form shields the personal wealth of the founders and other shareholders from the corporation’s creditors. It also facilitates the diversification of risk within a company, by allowing discrete pools of assets to be created, each with its own set of creditors who are barred from making claims on another asset pool, even though the parent company’s management controls all of them.

Further, the company’s own shares can be used as currency when acquiring other companies. When Facebook bought WhatsApp, it covered $12 billion of the $16 billion purchase price with its own shares, paying only $4 billion in cash. And, as with Facebook, corporate law can be used to cement control by founders and their affiliates through dual-class share structures that grant them more votes than everyone else. As such, they need not fear elections or takeovers of any kind.

Finally, companies whose assets take the form of intellectual property (IP) and other intangibles tend to rely even more on the helping hand of the law. As of 2018, 84% of the market capitalization of the S&P 500 was held in such intangible assets. It takes a legal intervention to turn ideas, skills, and knowhow – which are free to be shared by anybody – into exclusive property rights that are enforced by the full power of the state. And in recent years, Microsoft and other US tech companies have boosted their earning power significantly by promoting US-style IP rules around the world through the World Trade Organization’s body for Trade-Related Aspects of Intellectual Property Rights (TRIPS).

To be sure, there are good reasons for states to adopt laws that empower private agents to reap the rewards of organizing businesses and developing new products and services. But let’s call a spade a spade and a (legal) subsidy a subsidy. While Bezos, Bloomberg, Gates, and Zuckerberg may well be savvy entrepreneurs, they also have benefited on a massive scale from the helping hand of legislatures and courts around the world. This hand is more contingent than the invisible one immortalized by Adam Smith, because its vitality depends on a widely shared belief in the rule of law. The erosion of that belief, not a tax, poses the greatest threat to billionaires’ wealth.