The Daily

Shutdown, Go Ahead & Give It To Me

Baby, breakdown, go ahead and give it to me
Breakdown, honey, take me through the night (baby, baby, breakdown)
Breakdown, now I’m standin’ here, can’t you see?
Breakdown, it’s all right
It’s all right
It’s all right

Tom Petty & The Heartbreakers, Breakdown

The Federal court system is running out of operating money this week as a result of the government shutdown.

From earlier this week: Federal courts can hold out two more weeks under the government shutdown

This means that the Supreme Court will shutter (Government shutdown closes in on high court).

This means that prosecution of crimes – serious and minor – will stop, at least for the time being. Judges will not issue expected rulings, sentence convicted defendants or impanel jurors for trial. Defendants free on bail and convicted criminals awaiting sentence will rejoice. Crime victims and families will despair. Civil cases – where parties need to have financial disputes resolved – will languish. Insurance companies holding onto money owed will rejoice. Personal injury victims will despair. Judgments will go unentered. Trials will be suspended. Mistrials declared. Hearings will be canceled and delayed indefinitely. Court deadlines will be missed because clerks are not available to process efforts at compliance. While the electronic filing portal and Pacer may be open, that doesn’t resolve the physical work that only clerks can perform. This will create mass confusion that will take months or even years to repair.

When the shutdown began the federal courts had enough court fees to keep working through Friday. But over the past three weeks, the Administrative Office of the U.S. Courts has been asking the country’s 94 district courts to tighten belts and send back any money they could.

Some courts are putting off nonessential travel, canceling drug and reentry programs, and having to decide if a broken computer server qualifies as “mission critical.”

So far, the courts have found enough money to extend operations for two more weeks.

The chief judge in New York’s Southern District has issued a stay on civil cases, including several in which President Trump is a defendant.

New York’s Eastern District and Connecticut district courts issued no such stay. However, U.S. attorneys are writing to individual judges asking to postpone cases. According to a spokesperson, some judges are agreeing and some are not.

In The Face Of Government Shutdown, Some Federal Courts Cut Back On Cases

For one example of the important work being done in Federal Courthouses around the country, take the the multi-district litigation against opioid manufacturers and distributors who manufactured a very real national crisis (as opposed to the imaginary one that shut down the federal government).

NYT: Can This Judge Solve The Opioid Crisis?

Meanwhile, the top 1% continues to live relatively unaffected. Maybe even advantaged. Why? Let’s assume you were born to wealth and privilege, living in a country where the wealthy and privileged – supported by laws and rules they got passed to encourage themselves – were accustomed to being granted special privilege under the law. Maybe, as a titan of finance, you want a lower tax rate than the ‘average joe’. It’s not like ten million dollars a year goes as far as it used to. You might want to create a special tax rate for “capital gains” income, for instance. 10% or less sounds good (better than the plumbers’ 33% on his business income for sure). But after a while, that doesn’t feel like enough because it only applies to your investments. So, you start paying yourself in “capital gains” instead of salary. Savvy. Now we’re talking. But not everyone can work on Wall St. and your real estate developer neighbor wants a piece of the action. The tax code ought to work for everyone in the gated community, after all. And he supported you on the capital gains thing. So, when he mentioned the possibility of writing off massive deductions against his projects (permanently) that seemed only fair. As it turns out, he’ll end up with the same sub-10% effective tax rate. Funny how things turn out. Under this model, you could both accumulate enough in a few years that you wouldn’t even notice the rest of the country crumbling around you outside the gates of the country club.

And here’s the bonus. In order to pad your stats, you may have cut a few corners at the Company. A floor fire at the office building. A gas tank designed to explode a passenger car you build and sell to hundreds of thousands. A crane collapse on a job site. An SEC penalty in the billions for jamming account holders and investors with sketchy “fees”. Those pesky lawyers and their clients – always trying to cut in on your action. It’s infuriating. Where’s the justice?

But, hey. Wait a minute!? You say the court system and regulatory agencies are shutting down? LOL. Pass the oxygen infused caviar and the soylent green crackers.