The Wall Street Journal - 11.03.2020

A16| Wednesday, March 11, 2020 *** THE WALL STREET JOURNAL.**

Dr. Fed’s Is the Wrong Covid-19 Prescription

Regarding your editorial “The Cor-

onavirus ‘Stimulus’” (March 4): Re-

ducing the fed funds rate to 1% will

do nothing to stop the spread of the

coronavirus but will severely in-

crease the pain already suffered by

millions of senior Americans. They

saved their money, as they were

taught to do in the 1930s and ’40s,

bought only what they could pay for

during their earning years, and fool-

ishly expected to live off their sav-

ings in their old age.

Today saving seems to be a hope-

lessly outdated concept, considered

obstructive to the economy by the

academics at the Fed. Thriftiness was

considered a virtue by most of my

generation. We survived the mistakes

of our government leaders that led to

the Great Depression. We stood in

line outside banks with our parents,

hoping the latest government mis-

takes wouldn’t make our savings van-

ish, and worked and saved during the

privations of World War II.

We paid for what we bought and

kept our savings in the most secure

investments available. Now we can

thank the academics at the Fed for an

economy that will give us an income

of less than $1,000 if you have

$100,000 saved.

The attention of our nation is fo-

cused today on the election in No-

vember. For my generation there are

no candidates, or even a political

party, that seem capable of guiding

an economy that protects the life’s

work product of the generation that

fought the wars, both military and

economic, went without and paid

their own way while paying for “enti-

tlements” for the millions who have

inherited what we produced.

DAVIDF.SWEENEY

Stuart, Fla.

Your editorial indicates that the

central bank’s decision to reduce the

rate it pays on excess reserves to 1.1%

“gives banks more of an incentive to

put reserves to work in the real econ-

omy.” Except that if banks need to

decide between 1.1% interest paid on

reserves or putting money to work

“in the real economy,” that’s a certain

sign that they’re rather studiously

avoiding risk.

As they should. Banks can’t lend to

growth and innovation given the ra-

zor-thin margins they operate under.

This truth is a reminder that Fed

critics and supporters alike wildly

overstate the central bank’s economic

impact. Economic growth is a conse-

quence of surprise born of intrepid

investment. Banks can’t fund the in-

trepid. When are policy types going

to catch up to the logical reality that

the Fed’s just not that important?

JOHNTAMNY

Editor, RealClearMarkets

Washington

Peter Loftus is absolutely right in

“The Federal Reserve Should Just

Stick to Its Mandates” (Letters,

March 4). The Fed and foreign cen-

tral banks had no business trying to

react to the coronavirus. A lower fed-

eral-funds rate or printing money

cannot cure anyone or save one life.

Former Fed Chairman Paul Volcker

pointed out 40 years ago that: “the

creation of money is no substitute for

production and productivity. We

should heed his wisdom.

A coronavirus pandemic is a sup-

ply shock, though it is also expected

to be temporary, unlike a permanent

increase in energy prices. A pandemic

will have adverse effects on imports

of raw materials, other intermediate

materials and capital goods for its

duration, reducing productivity and

more important, human lives. Print-

ing money won’t save lives, reduce

sickness, boost productivity or GDP. A

vaccine, a cure or faster and better

public-health protection would mini-

mize the real economic effects of the

virus. The same principle applies to

cutting taxes. A tax cut cannot make

up for lives or productivity lost. Our

policy makers have panicked. There is

no need for further panic.

JOHNA.TATOM

The Johns Hopkins University

Baltimore

LETTERS TO THE EDITOR

Letters intended for publication should

be addressed to: The Editor, 1211 Avenue

of the Americas, New York, NY 10036,

or emailed to [email protected]. Please

include your city and state. All letters

are subject to editing, and unpublished

letters can be neither acknowledged nor

returned.

“I’m having a serious case

of hypothesis block.”

THE WALL STREET JOURNAL

Please, Please Sign Up to Be an Organ Donor

I wish to echo Terry Teachout’s

call for more donors of organs in “A

Thank-You Letter for Mrs. T’s Two

New Lungs” (March 7). My wife, Su-

san Hou, also received a lifesaving

lung transplant. What was unique

about her, however, is that she was

a kidney transplant doctor who had

actually donated a kidney to one of

her kidney-failure patients in 2002.

Interestingly, back in 1986, she

wrote a seminal article in the New

England Journal of Medicine with

two of her colleagues entitled “Kid-

ney transplantation from unrelated

living donors. Time to reclaim a dis-

carded opportunity.” Unfortunately,

she later developed a progressive

lung disease and received her lung

transplant 12 years to the day after

her kidney donation. Because of tox-

icity of the immunosuppressive

drugs she received, she ultimately

also required a kidney transplant—

this time from our son. Thus, she

experienced organ transplantation

from every angle.

She and our family as well as the

entire transplant community are

very thankful to people who are

willing to donate organs either

while alive or after dying.

MARKE.MOLITCH,M.D.

River Forest, Ill.

PCAOB Has Added Burdens

While Adding Little Value

Regarding Arthur Levitt’s “With-

out an Independent Watchdog, Who

Will Audit the Auditors?” (op-ed,

Feb. 20) and the letters (March 2) in

response: Before the Public Company

Accounting Oversight Board (PCAOB)

requirement, one accounting firm

prepared the tax return and audit for

my investment bank. That same work

now requires four accounting firms.

One to prepare the tax return, one to

prepare financial statements for the

PCAOB auditor, the PCAOB auditor

and a peer reviewer of the PCAOB

audit. For all of that, I have not seen

any actual improvement in audit

quality or protection for the invest-

ing public.

JEFFBODINGTON

San Francisco

Pepper ...

And Salt

Employer Buy-In Is a Key

In Work From Home Success

As a remote-work advocate and

full-time remote worker, I appreciate

“Working From Home? Here Are Your

Tech Fixes” (Personal Technology,

March 5). The suggestions you out-

line are great for a temporary re-

mote-work situation, but I would fol-

low up with the idea that a company

needs to be the one leading this

charge in providing its employees

with the tools to be successful. In my

experience, it is often the lack of poli-

cies and procedures that lead to re-

mote-work failure and not the em-

ployee’s ability to work at home.

Some steps that companies can

take are to work with a remote-work

expert to put policies in place. Before

my company did so, we were missing

key components of video-call expec-

tations. Cats appearing on camera

are cute for cat lovers but are not

professional.

Many companies say they aren’t

set up for remote work because of se-

curity concerns. Employing a virtual

private network (VPN) for secure in-

ternet use and allowing employees to

remotely login to an intranet usually

are easily accomplished from an in-

formation-technology perspective.

KELLYSTREET

Minneapolis

Supreme Court Funded Via

Congress, Why Not CFPB?

Regarding your editorial “Constitu-

tional Case of the Year” (March 3):

Your point that the Consumer Finan-

cial Protection Bureau (CFPB) is un-

constitionally constituted because the

director need not submit a budget to

Congress should strike home with Jus-

tices Samuel Alito and Elena Kagan.

The two justices were the most recent

members of the Supreme Court to ap-

pear before a House committee in

March 2019 to testify about the budget

the court had submitted to Congress.

If even the Supreme Court, a coequal

branch of government, must obtain

funding from Congress, how can it be

that the CFPB need not do so?

TIMKELLY

Naples, Fla.

Cleaning Up the FISA Mess

I

nspector General Michael Horowitz in De-
cember exposed gross FBI abuse of a secret
surveillance court in obtaining warrants to
spy on former Trump aide
Carter Page. House leaders
late Tuesday struck a biparti-
san deal to impose greater ac-
countability, though in at least
one respect it may make
things worse.
Congress is facing a March 15 deadline to re-
authorize three critical surveillance tools, all of
which are overseen by the Foreign Intelligence
Surveillance Court. That’s the court the FBI
duped in 2016-17 by supplying false information
provided by the Hillary Clinton campaign and
omitting exculpatory facts about Mr. Page.
Despite these revelations, House Democrats
initially planned a reauthorization that con-
tained negligible reform. But a revolt by progres-
sives against nearly any surveillance forced
Democratic leaders to seek GOP votes. Thus the
chance for some modest reform.
Congress created FISA in the late 1970s to
guard against wiretap abuse. The best reform
would be to abolish the court. As legal sages Lau-
rence Silberman and Robert Bork pointed out in
1978, Presidents are responsible to voters if they
abuse spying powers. FISA inserts unelected Arti-
cle III judges into the process, diluting account-
ability. The FBI insisted its Page applications were
valid since the court approved them, while the
court blames a dishonest FBI. The abuses are al-
ways someone else’s fault.
Alas, abolishing FISA now would require a re-
write of most intelligence laws—which isn’t fea-
sible before this reauthorization. The fallback is
to change the FISA process to impose more ac-
countability on the FBI and Justice Department,
and the GOP seems to have achieved some im-
portant victories.
The most significant reform writes into law
Attorney General Bill Barr’s recent administrative
requirement that politically sensitive investiga-
tions be approved by the AG. One scandal of the
Page investigation is that the FBI had no obliga-
tion to consult or even notify its Justice bosses.
As a cabinet official, the AG is accountable to the
President and thus to voters.
Another improvement requires a system of

checks to ensure that information submitted to

the court is accurate. The Horowitz report high-

lighted the ease with which individual agents

could drop false details into

the Page file, while leaving out

exculpatory facts.

Republicans also won crimi-

nal penalties for officials who

make false representations to

the court. The risk here is that

a criminal standard could end up punishing in-

telligence officials who make good-faith errors.

Our sources say the bill’s language is narrow

enough that it won’t trap honest mistakes but

will punish FBI agents who try to pass off on the

court disinformation of the kind peddled by par-

tisan spy Christopher Steele.

The House version also includes greater access

by the House and Senate intelligence committees

to the documents used to justify FISA applica-

tions. Recall how the Justice Department initially

refused to let then House Intelligence Chair Devin

Nunes review the Page warrant files. Only thanks

to Mr. Nunes’s doggedness did we learn about the

FBI’s FISA abuse. The risk here is that some Mem-

bers might abuse the privilege by leaking.

The bill’s worst reform would let a FISA

judge choose an outsider advocate for the tar-

get of a FISA application. In theory, advocates

would find and critique the abuses found in

the Page application. In practice, they could

dilute accountability further. There’s no guar-

antee advocates would stop political shenani-

gans, though they may impede legitimate FISA

warrants.

Consider the FISA court’s recent appointment

of David Kris as its point man for internal re-

form. Mr. Kris criticized the Bush Administra-

tion’s wiretaps of suspected terrorists in 2006

but defended the FBI’s abuse of Mr. Page. An ad-

vocate system would create another unaccount-

able bureaucratic layer to engage in finger point-

ing when things go wrong.

FISA was created as a check on wiretap

abuses, but it failed as do most attempts to mess

with the Constitution’s separation of powers.

We’d prefer to remove Article III judges from the

executive branch where they don’t belong, but

this reform will at least make it harder to repeat

the FBI’s Page disgrace.

The House GOP wins

some modest reforms

for accountability.

Putin’s President-for-Life Plan

‘I

t would be very disturbing to return to
the situation of the mid-1980s,” Rus-
sian President Vladimir Putin said in
January. “With the leaders of
the state, one by one, staying
in power until the end of their
days.” He was right at the
time, but this week Mr. Putin
nonetheless cleared the way
to rule Russia past his 83rd
birthday. No one anywhere is surprised.
On Tuesday the rubber-stamp Duma ap-
proved a constitutional amendment that would
allow the 67-year-old to run for two more six-
year terms. The measure must be approved by
a Russian court, but woe to the judge who finds
it illegal. Then Russian voters will get their say
in a referendum, but the Kremlin controls
nearly all Russian media. This all but ensures
that Mr. Putin, who has been Prime Minister
or President for two decades, won’t have to
step down in 2024 as he had promised.
The strongman has a reputation in some
quarters as a master political tactician. It’s
true that Russia punches above its weight in-
ternationally, from Venezuela to Syria and in-
creasingly across Africa. Yet these costly inter-
ventions are often driven by a need to find
foreign villains in order to shore up domestic
political support as much as any grand geopo-
litical vision.
Russia remains an economic backwater
overly reliant on energy exports. Life expec-
tancy is comparable to the U.S. in the 1970s.
The average Hungarian or Pole is now wealth-
ier, and millions of Russian know it. Mr. Putin’s

high approval ratings obscure that surveys

show only about a third of Russians say they

trust their leader.

That’s largely because of

the corruption that has flour-

ished at every level of the

Russian state under Mr. Pu-

tin. The country ranks 137 out

of 180 in Transparency Inter-

national’s 2019 Corruption

Perceptions Index. That’s a regression from 82

when he took office.

Mr. Putin conceded during the Duma debate

that “in the long term” it’s good to prevent

leaders from clinging on. It’s possible he’s

keeping his options open as he plans a safe

way out. Kazakh President Nursultan Naz-

arbayev showed how this could be done last

year, after he stepped down from the presi-

dency but retained some powers to protect

himself. But like most authoritarians, Mr. Putin

can’t afford to leave office lest he lose protec-

tion against the enemies he’s made and the

power to keep his many business and political

retainers rich.

Mr. Putin has been lucky in his 20-year

reign, not least with a long run of high oil and

gas prices. But that era has been challenged

by the rise of American shale drilling, which

is why he is now hoping to use slumping global

oil demand to break the U.S. industry. He is un-

likely to succeed even if there is a U.S. reces-

sion since American producers that survive

will get more efficient. In a country without

the rule of law, even seemingly secure leaders

can never sleep well.

The Russian dictator is

preparing to remain in

power well into his 80s.

Twilight of the Sanders Revolution

D

emocrats really, really want to defeat
President Trump. That’s the message
from Joe Biden’s primary victories on
Tuesday as he further deflated
the hopes of Bernie Sanders
and his revolution.
If Democrats had buyer's
remorse after Mr. Biden’s
stunning comeback on Super
Tuesday last week, they didn’t
show it as he rolled to easy wins in Mississippi,
Missouri and Michigan. The victory was espe-
cially impressive in Michigan, where Mr. Sand-
ers won narrowly in 2016 but Mr. Biden led by
14 percentage points by our deadline. Washing-
ton state was too close to call.
The Vermont Senator campaigned heavily in
the Wolverine State, especially in college towns
full of social-justice warriors and gentry liber-
als. Mr. Sanders won voters under age 29 by
about 82% to 15%, according to the exit polls,
but they were only about 15% of the electorate.
Voters older than age 65 made up about a quar-
ter of the Democrats who cast ballots, and Mr.
Biden won them 73% to 23%.
Mr. Sanders tried to turn Democrats against
Mr. Biden in Michigan by running against Nafta,
and charging that the former Vice President
would slash Social Security and Medicare. But
Democrats don’t believe the latter, and trade
has gained support among Democrats as Mr.
Trump has co-opted the protectionist agenda.

The mass voter mobilization of the proletar-

iat that Mr. Sanders promises simply hasn’t ma-

terialized. As that fact becomes clearer to Dem-

ocrats who want to win in

November, Bernie’s chances of

a comeback diminish even

more.

Meanwhile, Mr. Biden

showed strength among most

voter groups that Democrats

will need to win in November. That includes

older African-American voters in and around

Detroit, but his reach extended to suburban vot-

ers in wealthy Oakland County and working-

class whites without a college degree through-

out the state.

This coalition is remarkable considering that

Mr. Biden barely had what you could call an or-

ganized campaign on the ground in Michigan

and other states. He was catapulted by free me-

dia after his wins in South Carolina and Super

Tuesday, and by Democratic Party officials who

rallied behind him to stop Mr. Sanders. Turnout

was also higher than in 2016. If this coalition

and enthusiasm don’t scare Republicans and the

Trump campaign, they should.

Mr. Sanders’s best chance for a revival is the

debate scheduled for Sunday, March 15, in Phoe-

nix. If Mr. Biden falters, Democratic doubts

about his ability to go the distance against Mr.

Trump could return. Otherwise we are looking

at the twilight of the Sanders revolution.

Biden gets closer to the

nomination with a big

victory in Michigan.

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