THE DAILY NEWS

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REUTERS

"Biden to name 'slate' to Fed, emphasis on workers - Senator Brown says"


Reuters

October 26, 2021

Oct 26 (Reuters) - U.S. President Joe Biden will probably advance a "whole slate" of nominees to the Federal Reserve Board, which may or may not include current chair Jerome Powell and will ensure a greater emphasis on workers, Senator Sherrod Brown said on Tuesday.

In an interview with Bloomberg Television, Brown, the head of the Senate banking committee, said he had spoken with Biden "just the other day" about the makeup of the Federal Reserve board.

The president understood that workers should be at the center of economic policy, which "includes making the Fed look more like America but think more like America too," said Brown, adding that he gets along well with Powell but the decision on Powell's renomination is Biden's.

The Senate banking committee oversees the Fed and must sign off on Fed nominees before they can be considered for approval by the Senate as a whole.


Powell's term as Fed chair expires in February; the seven-member Fed Board also has one vacant seat and at least one and potentially two other seats that will open up in coming months.

"When the president looks for making up to four nominations - maybe including Powell, maybe not - there will be a much great emphasis on workers," Brown told Bloomberg TV.

The White House has not chosen any fixed timetable for Biden to make a decision on Fed personnel, a process delayed by congressional negotiations over his signature economic revival package.

"We know there are going to be vacancies on the Fed Board of Governors - we need a full board of governors at the Fed," a spokesperson for Brown said.

Despite a time crunch to seal that deal, administration officials have been discussing their options for Fed appointments in recent weeks, according to a person familiar with the matter.

The question of who should run the Fed comes at a critical moment for the U.S. economy.

Central bankers have signaled they will begin reducing their support for the economy next month by cutting back what is currently $120 billion in monthly asset purchases down to nothing by the middle of next year.

Policymakers are divided on how soon after that they will need to start putting the brakes on economic growth with interest rate hikes, with much depending on whether currently high inflation has begun to subside as many expect, as well as who is on the rate-setting committee by that time.

Two of the most hawkish of the Fed's 12 bank presidents, who along with the Fed Board decide on monetary policy, resigned last month amid an outcry over their securities trading.

In response, Powell tightened restrictions on policymakers' investing, although some critics see the scandal as one more reason to pick someone else to run the Fed.

Some progressives favor current Fed Governor Lael Brainard to take over.

Others who support keeping Powell in his current role say Brainard could make her mark on both climate and regulation if she takes over as the Fed's regulation czar, a slot that opened up earlier this month after Randal Quarles' term expired.

"That position is really really really important," Brown said of the vice chair for supervision role, adding that he's spoken with Biden about "a couple" of people he would support for the job.

Brown said that though Powell has "done some things that I think are too supportive of Wall Street when it comes to deregulation, and he is not engaged enough on climate," he has done a "reasonably good job on monetary policy."

Brown's remarks contrasted sharply with those of Senator Elizabeth Warren, who is also on the banking committee and has said she will oppose Powell's renomination, citing what she sees as his weak record on regulation.

On the weekend Treasury Secretary Janet Yellen defended Powell's regulatory record, though she declined to say what advice she was giving Powell on the issue.

Reporting by Trevor Hunnicutt and Ann Saphir; Editing by Andrea Ricci and Richard Pullin

https://www.reuters.com/world/us/biden- ... 021-10-26/
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REUTERS

"S&P 500 hits record high on tech strength, earnings cheer"


By Devik Jain and Shashank Nayar

October 26, 2021

Summary

* GE rises on lifting 2021 earnings forecast

* UPS tops S&P 500 as results beat on e-commerce demand

* Indexes up: Dow 0.35%, S&P 0.54%, Nasdaq 0.62%


Oct 26 (Reuters) - Gains in Tesla, Nvidia and other heavyweight technology names helped the benchmark S&P 500 index scale a record high on Tuesday, while upbeat results from UPS and GE added to optimism around the third-quarter earnings season.

Tesla Inc rose 1%, extending a record run that helped the electric-car maker surpass $1 trillion in market value on Monday after landing its biggest-ever order from rental car company Hertz.

Nvidia Corp was up 6.8% and hit an all-time high, while gains in mega-cap growth names such as Amazon.com, Apple Inc, Google-owner Alphabet Inc and Microsoft Corp gave a boost to the tech-heavy Nasdaq.

Ten of the 11 major S&P sectors advanced, with consumer discretionary, information technology and financials hitting life-time highs.

United Parcel Service Inc surged 7.6% to top the S&P 500 index after the delivery firm reported better-than-expected quarterly earnings and revenue, bolstered by strong e-commerce demand.

General Electric Co rose 2.6% after the industrial conglomerate raised its full-year earnings forecast.

Shares of Hasbro Inc climbed 3.7% after the toy maker posted an upbeat third-quarter profit even as it warned of a hit to holiday sales from supply chain issues.

"Investors are prepared for the worst and are looking at the near-term positives against what lies ahead and that is helping gains at an index level," said Arthur Hogan, chief market strategist at National Securities in New York.

"The key component of the weak outlooks are led by supply and not because of lack of demand for companies ... there is confidence that corporate America will be able to navigate through a lot of the supply and inflation headwinds."

Earnings at S&P 500 companies are expected to grow 35.6% year-on-year for the third quarter, with market participants assessing how companies are navigating supply-chain bottlenecks, labor shortages and inflationary pressures.

Some stellar quarterly reports have helped drive the Dow and the S&P 500 to record highs, lifting investor sentiment in October after concerns around inflation, the Fed's tapering and property group China Evergrande's crisis rattled markets last month.

The Nasdaq is trading about 0.5% below its Sept. 7 record high.

At 11:46 a.m. ET, the Dow Jones Industrial Average was up 125.39 points, or 0.35%, at 35,866.54 to hit a record high.

The S&P 500 was up 24.64 points, or 0.54%, at 4,591.12, and the Nasdaq Composite was up 94.73 points, or 0.62%, at 15,321.44.

Facebook Inc slipped 3.2% as the social media giant's third-quarter revenue faced the brunt of Apple's privacy rules, while advertisers were also affected by global supply-chain disruptions and labor shortages.

Twitter Inc, which also generates revenue by selling digital ads, edged higher ahead of its results on Tuesday.

Eyes are also on quarterly updates from Alphabet Inc and Microsoft after market close, with focus on how Google's ad revenue fares.

Meanwhile, data showed U.S. consumer confidence unexpectedly rebounded in October as concerns about high inflation were offset by improving labor market prospects.

Advancing issues outnumbered decliners for a 1.44-to-1 ratio on the NYSE and a 1.24-to-1 ratio on the Nasdaq.

The S&P index recorded 60 new 52-week highs and no new low, while the Nasdaq recorded 119 new highs and 44 new lows.

Reporting by Devik Jain and Shashank Nayar in Bengaluru; Editing by Maju Samuel and Shounak Dasgupta

https://www.reuters.com/business/sp-dow ... 021-10-26/
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RIGZONE

"Oil Drops On Iran and EU Announcement"


by Bloomberg | Julia Fanzeres and Devika Krishna Kumar

Wednesday, October 27, 2021

Oil declined after Iran and the European Union agreed to restart negotiations on a revival of the 2015 nuclear accord before the end of next month, signaling a greater prospect of Iranian barrels coming back to the market.

Futures in New York fell 2.4% on Wednesday.

A date for the big-power talks will be announced next week, Ali Bagheri Kani said in a tweet after meeting the European Union’s deputy envoy for foreign affairs in Brussels.

Meanwhile, a U.S. inventory report showing a larger-than-expected crude supply gain also weighed on prices.

If the negotiations lead to the end of U.S. sanctions and Iran oil exports rise, it could end the “threat of a supply shortage that has been partly the reason behind the big oil rally,” said Fawad Razaqzada, a market analyst with ThinkMarkets.

Crude has rallied in recent months as a gas-centered energy crunch boosts demand for oil products and the Organization of Petroleum Exporting Countries and its allies only modestly restore supplies.

Global crude inventories are rapidly shrinking, and in China, crude supplies fell to 59% of capacity, according to data analytics firm Kayrros, the lowest since November 2018.

The Biden administration wants to return to the accord with Iran that the U.S. abandoned in 2018, but has refused to lift any Trump-era sanctions or release any Iranian funds before talks resume.

Tehran has significantly expanded its nuclear program in response to Washington’s exit and its tough sanctions regime.

Prices:

West Texas Intermediate crude for December delivery fell $1.99 to settle at $82.66 a barrel.

Brent for December settlement declined $1.82 to end the session at $84.58 a barrel.

The Energy Information Administration report showed U.S. crude inventories rose 4.27 million barrels last week, more than the industry-funded American Petroleum Institute’s reported 2.32 million-barrel gain.

Inventories at the nation’s biggest storage hub at Cushing, Oklahoma, fell by the most since January, reducing supplies to about 27.3 million barrels.

Cushing stockpiles were one of the most widely-watched parts of the report as supplies approach 20 million barrels.

Inventories have been draining as oil prices for immediate delivery are well above those for delivery in the future, making storing oil unprofitable.

(With assistance from Sheela Tobben)

https://www.rigzone.com/news/wire/oil_d ... 8-article/
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CNBC

"10-year Treasury yield falls below 1.6%, giving back recent gains"


Jesse Pound @JESSERPOUND Vicky McKeever @VMCKEEVERCNBC

PUBLISHED WED, OCT 27 2021

The 10-year U.S. Treasury yield fell sharply on Wednesday, giving back some of its recent gains as investors monitored policy changes at global central banks.

The yield on the benchmark 10-year Treasury note dropped 8 basis points to 1.534% in afternoon trading.

The yield on the 30-year Treasury bond fell more than 10 basis point to 1.947%.

Yields move inversely to prices and 1 basis point is equal to 0.01%.

The moves in debt markets came after the Bank of Canada announced on Wednesday that it was ending its quantitative easing program, joining a growing number of central banks that are rolling back their pandemic era programs.

The U.S. Federal Reserve is set to meet again next week.

“Today we’re seeing a big flattening of the yield curve, with long rates coming down and short rates moving up."

"It was starting to happen a day or two ago, but I think what it’s reflecting now is Canada’s starting to move, Bank of England will probably cut rates, and you tend to get a flattening of the yield curve when people start to see the rate hike cycle really kick in,” said Kathy Jones, chief fixed income strategist for Schwab Center for Financial Research.

“Now, the U.S., we’re not even done easing, let alone tightening, so it might be a little premature here,” Jones added.

The benchmark 10-year yield briefly traded above 1.68% last week but has fallen 15 basis points since then.

The 2-year Treasury yield has climbed roughly 12 basis points over the same period.

Companies continued to report strong earnings in the U.S., which saw the S&P 500 notch its 70th intraday high of 2021 and 57th record close of the year.

However, worries around rising inflation, supply chain issues and a slowdown in the economy, continue to weigh on investors’ minds.

New orders for durable goods fell less than expected in September, according to the Census Bureau.

The rise for August was revised down to 1.3% growth from 1.8%, however.

Auctions were held on Wednesday for $40 billion of 119-day bills and $61 billion of seven-year notes.

— CNBC’s Pippa Stevens contributed to this market report.

Data also provided by Reuters

https://www.cnbc.com/2021/10/27/us-bond ... esday.html
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REUTERS

"White House says Biden supports billionaire tax"


By Reuters Staff

OCTOBER 27, 2021

WASHINGTON, Oct 27 (Reuters) - U.S. President Joe Biden supports imposing a new “billionaire tax” and the White House believes the Democratic proposal would be legal, spokesperson Jen Psaki said on Wednesday.

(Reporting by Jeff Mason and Trevor Hunnicutt; Editing by Chris Reese)

https://www.reuters.com/article/usa-bid ... SL1N2RN2EE
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REUTERS

"TREASURIES-U.S. 2-year yield soars to 19-month peak, curve flattens across the board"


By Gertrude Chavez-Dreyfuss

OCTOBER 27, 2021

* U.S. 5/30 yield curve flattest since March 2020

* U.S. 2/10 yield spread narrowest since August

* U.S. 30-year yield falls to five-week low

* U.S. 10-year yield slides to two-week trough

* U.S. 5-year note auction shows strong demand


NEW YORK, Oct 27 (Reuters) - U.S. 2-year Treasury yields rose to fresh 19-month highs on Wednesday, flattening the yield curve, as the possible timing of the Federal Reserve's first interest rate rise came into tighter focus.

A strong U.S. 5-year note auction added to overall bids in the Treasury market, pushing longer-dated yields lower.

The note at the auction picked up a high yield of 1.157%, lower than the expected rate at the bid deadline, suggesting investors were seeking a lower premium for the 5-year note.

The bid-to-cover ratio was 2.55, compared with an average of 2.37 over the last several auctions.

In the run-up to the Fed's policy meeting next week, market focus has moved beyond pricing the central bank's likely taper of asset purchases and onto the timing of the first rate rise since December 2018.

Rising oil prices and inflation expectations have fed into that pricing, even though Fed Chair Jerome Powell said last week it wasn't time to raise rates just yet.

Bank of England Governor Andrew Bailey, on the other hand, signalled last week that the BoE would act to curb inflation expectations.

Futures markets now fully price in a 15 basis point BoE rate hike on Nov. 4 and another 25 basis point move in December.

"The BoE has people questioning if the Fed can really hold off that long especially with the inflation backdrop that we have and the continued supply chain pressures," said Zachary
Griffith, macro strategist at Wells Fargo.

"I think that's what making people re-assess what's realistic and how committed the Fed can be to its average inflation targeting that is kind of untested," he added.

The Fed is widely expected to begin tapering its $120 billion in monthly purchases of Treasury bonds and mortgage-backed securities next month, but Fed funds futures already priced a 70% chance of a June rate hike on Tuesday.

U.S. 2-year yields spiked to 0.511%, the highest since March 2020, and were last at 0.4911%.

The 5-year yield -- another segment of the curve that's also sensitive to interest rate expectations -- was last down 4 basis points at 1.1450%.

It hit 1.2520% on Monday, the highest since February 2020.

U.S. 10-year yields dropped to a two-week low of 1.527% and were last at 1.5361%.

That, in turn, narrowed the spread between the 2- and 10-year yields to 103 basis points, the flattest since late August.

The 30-year slid to a five-week trough of 1.9486%. \

It was last down 10 basis points at 1.9507%.

The spread between U.S. 5-year notes and 30-year bonds narrowed to as low as 77.8 basis points, the tightest gap since March 2020.

The U.S. 5-year inflation breakeven rate, meanwhile, which reflects market-based inflation expectations over the next five years, hit north of 3%, the highest since at least January 2004.

Ten-year breakevens were at the highest since May 2006.

(Reporting by Gertrude Chavez-Dreyfuss; Additional reporting by Sujaya Rao in London, Tom Westbrook and Vidya Ranganathan in Singapore; Editing by Kirsten Donovan)

https://www.reuters.com/article/usa-bon ... SL1N2RN1T5
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REUTERS

"U.S. companies to keep prices high as supply chain headaches persist"


Reuters

October 27, 2021

NEW YORK, Oct 27 (Reuters) - The largest U.S. manufacturers including General Motors, General Electric, 3M and Boeing face logistics headaches and higher costs due to global supply bottlenecks that are likely to persist into next year but agreed the hit to profits can be mitigated by charging higher prices for their goods.

Companies across the globe sounded the alarm on supply issues months ago that have pushed prices higher on raw materials from chemicals to steel.

In earnings reports this week investors got a closer look at how companies are managing.

"It starts with really strong price," said GM Chief Executive Officer Mary Barra in a call with reporters.

"We were able to do very well (with) full-size trucks and full-size SUVs."

"We just can't build enough of those vehicles."

GM is also looking to wring efficiencies from its supply chain and she said the chip shortage is likely to improve in the second half of 2022.

Larry Culp, the chief executive of General Electric Co, a maker of jet engines and wind turbines, told investors keeping up with fits and starts in the global supply chain was akin to playing a carnival game that aims to keep players on their toes.

"I'm not sure we're yet at a place where we would say that things are stable," Culp told investors on an earnings call on Tuesday.

"It really is akin to playing a whack-a-mole."

General Electric also expects supply constraints to persist through the rest of the year and in 2022, hurting profit in its healthcare business.

Boeing Co also complained of a "severely weakened supply chain."

The pandemic has crippled many companies' ability to send and receive the parts and supplies needed to make a wide range of products, creating shortages, reducing inventories and hammering profits.

On Wednesday, Harley-Davidson said it increased surcharge pricing in the United States to offset higher raw material costs.

The motorcycle maker expects these costs to remain high and is exploring higher surcharge costs globally.

Harley-Davidson said the inventory shortage is also squeezing its international market share.

McDonald's Corp also said it had to raise prices in the United States.

Industrial giant 3M Co cut its full-year earnings outlook on Tuesday and said it would increase product prices to combat inflationary and supply chain pressures.

The company, which makes a long list of building and construction products, said it was facing higher costs related to polypropylene, ethylene, resins and labor.

It added that the global semiconductor crunch would continue to weigh on its automotive and electronics end-markets.

On Tuesday, Lockheed Martin Corp dramatically lowered its sales expectations for this year, saying the pandemic has hobbled the top U.S. defense contractor's supply chain.

Its shares fell more than 11% on Tuesday.

Lockheed's chief financial officer said the problem worsened for them over the last two months, as the maker of the F-35 fighter jet lowered its 2021 revenue expectations by 2.5% to $67 billion and said next year's revenue could fall to $66 billion.

Reporting by Reuters staff; Writing by Bernard Orr; Editing by Andrea Ricci

https://www.reuters.com/business/us-com ... 021-10-27/
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REUTERS

"Companies to U.S. shipping regulator: enough probes, start enforcing"


Reuters

October 27, 2021

WASHINGTON, Oct 27 (Reuters) - A U.S. trade group representing companies selling luggage, backpacks and other travel products has written President Joe Biden asking that regulations on shipping and other fees be strictly enforced to help bring down the cost of shipping.

The Travel Goods Association, whose companies do some $1 billion in U.S. sales annually, asked for "immediate action – aggressive enforcement, leadership to bring the full gamut (of) stakeholders to the table, provide immediate relief, and more."


They said shipping costs are now eight to 10 times higher than what they paid last fall and that they "are now witnessing rates that exceed the value of product being shipped within the container."

The group said that contracts are sometimes ignored so that goods are left behind and that they also hit delays in getting into U.S. ports, and are being charged for the delays.

While the group did not blame the problems on the COVID-19 pandemic, the crisis has caused unprecedented bottlenecks in the supply chain which economists and businesses expect to persist through the first half of 2022.

The association demanded action from the Federal Maritime Commission (FMC), noting investigations that have already taken place.

"Aggressive enforcement of existing rules and regulations is essential," the group said.

"The FMC has conducted numerous inquiries on excessive and unjust fees and on unreasonable policies and practices."

"Those inquiries must now turn into enforcement actions to bring the scourge of excessive fees and unreasonable carrier practices to an end," it said.

Reporting by Diane Bartz; Editing by Sonya Hepinstall

https://www.reuters.com/business/compan ... 021-10-27/
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REUTERS

"Cyclicals drag S&P 500 lower; Microsoft, Alphabet keep Nasdaq flat"


By Chuck Mikolajczak

OCTOBER 27, 2021

NEW YORK (Reuters) - The Nasdaq ended little changed on Wednesday, boosted by gains in Microsoft and Google parent Alphabet on the heels of their quarterly results, but a drop in oil prices and a pullback in Treasury yields weighed on cyclical sectors and pulled the S&P 500 lower.

Microsoft Corp gained 4.21% to close at a record high after forecasting a strong end to the calendar year, fueled in part by its booming cloud business.

Alphabet Inc jumped 4.96% after reporting a record quarterly profit on a surge in ad sales.

The gains in the two stocks accounted for nearly 90 points to the upside in the tech-heavy Nasdaq while Microsoft was the biggest boost to the Dow Industrials, S&P 500 and Nasdaq.

A pullback in longer-term U.S. Treasury bond yields and a flattening of the yield curve also helped support growth names such as those in consumer discretionary and communications services, which were the only advancing S&P sectors on the day.

The benchmark 10-year U.S. Treasury yield declined for a fourth straight day, dropping more than 6 basis points to put it on track for its biggest one-day decline since Aug. 13.

“The growthy names will get a boost not just from some of the earnings stuff but because interest rates are lower,” said Megan Horneman, director of portfolio strategy at Verdence Capital Advisors in Hunt Valley, Maryland.

“Interest rates are temporarily lower because of the fact that there is some uncertainty from the tax perspective and what that might do."

"We do know the Fed is going to taper, that has pretty much been priced in but now you have a lot of talk about what the future of the Federal Reserve may look like.”

The Dow Jones Industrial Average fell 266.19 points, or 0.74%, to 35,490.69, the S&P 500 lost 23.11 points, or 0.51%, to 4,551.68 and the Nasdaq Composite added 0.12 point, or unchanged, to 15,235.84.

In contrast, the flattening curve served to weaken financials, while a drop in crude prices after data on U.S. stockpiles pulled energy names lower, with both sectors suffering their biggest one-day percentage decline in five weeks.

JP Morgan shares fell 2.08% and Exxon Mobil declined 2.60%.

A solid start to earnings season has helped push the S&P 500 and the Dow to all-time highs this week, as investor concerns over the ability of companies to navigate supply-chain bottlenecks, labor shortages and rising price pressures have been allayed for now.

The Nasdaq sits less than 1% away from Sept. 7 closing record.

“While we are not out of the woods by any means, companies are adjusting quicker than we had anticipated,” said Horneman.

Profits for S&P 500 companies are expected to grow 37.6% year-on-year in the third quarter.

Out of the 192 companies that have reported earnings, 82.8% have topped analyst expectations, according to Refinitiv IBES data.

The move into the growth names like technology stocks was also triggered after some U.S. Senate Democrats proposed taxing billionaires’ unrealized gains from their assets, while concerns around the timing of rate hikes resurfaced ahead of the Federal Reserve’s policy meeting next week.

The S&P 500 growth index climbed about 0.28% while its value counterpart fell 1.44%.

Robinhood Markets Inc tumbled 10.44% after the retail broker reported downbeat third-quarter revenue as trading levels declined for cryptocurrencies including dogecoin.

Declining issues outnumbered advancing ones on the NYSE by a 2.43-to-1 ratio; on Nasdaq, a 2.29-to-1 ratio favored decliners.

The S&P 500 posted 36 new 52-week highs and 5 new lows; the Nasdaq Composite recorded 72 new highs and 133 new lows.

Volume on U.S. exchanges was 11.74 billion shares, compared with the 10.43 billion average for the full session over the last 20 trading days.

Reporting by Chuck Mikolajczak in New York; Editing by Matthew Lewis

https://www.reuters.com/article/usa-sto ... SL1N2RN2ZO
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NATIONAL REVIEW

"Democrats Propose a Federal Speech Czar"


By BRADLEY A. SMITH

October 20, 2021 10:23 AM
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Tucked inside a supposedly ‘moderate’ voting bill is a provision that would empower a lone bureaucrat to wield outsized control over elections.

Deep inside the Democrats’ latest “compromise” proposal on elections and campaign finance is a new cup of poison for free speech and fair campaigns.

Of course, the sponsors bragged that they dropped some controversial provisions.

One such provision altered the Federal Election Commission (FEC), which polices campaign-finance laws, from a bipartisan agency to one with a partisan majority appointed by the president.


The bill, now dubbed the Freedom to Vote Act, abandons that direct attempt to give the president a partisan majority at the FEC.

But it still abolishes the principle of bipartisan approval of enforcement actions.

Even worse, it rigs court review of FEC decisions against defendants.

In a sign of the bill’s hostility to free speech, the measure also proposes doubling the statute of limitations for most violations of federal campaign-finance laws to 10 years.

That’s longer than the statute of limitations for the crime of attempted assassination of a member of Congress.

The FEC was created nearly 50 years ago, in the wake of Watergate, to prevent the president from weaponizing campaign-finance laws against political opponents.

The most important feature is the Commission’s bipartisan makeup — six commissioners, with no more than three from any one party.

At least four commissioners must approve initiating investigations or finding violations, thus assuring some measure of bipartisan agreement that a law may have been violated.

Under the Democrats’ proposal, the FEC would keep the same structure, but scrap the bipartisan requirement for enforcement action.

Instead, the Commission’s general counsel would take control of actions such as starting an investigation and declaring a violation.

The counsel’s decision would prevail unless, within 30 days, four commissioners voted to overrule it.


In other words, it would take a bipartisan coalition of four commissioners to stop an investigation rather than launch one.

It would also take four votes to declare that no violation occurred.

The bipartisan requirement for finding a violation is removed, just as it was in the earlier bill.

The FEC general counsel is a career civil servant, but we should not assume that he is without political preferences or bias.

What kind of person aspires to regulate speech about campaigns and elections?

Few free-speech advocates probably would think to apply for such a job.

Nor are counsels without partisan preferences.

One former FEC general counsel later served as general counsel to Senate Democratic leaders Tom Daschle (S.D.) and Harry Reid (Nev.), and to one of Joe Biden’s presidential campaigns.

Another later worked for former Massachusetts Republican governor William Weld.


Even assuming the integrity of the counsel, partisan views can influence how one sees cases in partisan elections.

That is a major reason current law requires a bipartisan vote to launch an investigation or find a violation.

Under the proposed act, it would no longer be necessary to convince anyone from the opposing party to declare a violation.

If a vacancy in the general-counsel position occurs, the most senior attorney at the FEC would become the acting general counsel until replaced.

This means the commissioners could have no say in picking the acting general counsel.

If this person turns out to be a hard-core partisan, he or she can stay in the position indefinitely, provided there is support by three partisan commissioners.

The bill further stacks the deck against free speech by rigging the judicial-review process against defendants.

Under current law, if the FEC rules that there is no violation, the complainant can appeal to the federal courts.

Conversely, if the agency finds a violation, the defendant can demand a day in court.

The bill would keep this system intact, but with new rules for the court.

Under what is known as Chevron deference, if a law is subject to more than one interpretation, federal courts give deference to an agency’s interpretation of the law.


Under the proposed Freedom to Vote Act, however, if the FEC dismisses a complaint, courts give no deference to the Commission’s interpretation of the law.

But if the Commission finds a violation, the courts will defer to the FEC’s interpretation of the law, pursuant to Chevron deference.

In other words, the bill would put a thumb on the scale of justice, tilting it toward finding that speakers violate the law.

It’s hard to think of the measure that would do more to undermine confidence in the fairness of our campaign-finance laws.

BRADLEY A. SMITH is chairman of the Institute for Free Speech and the Blackmore/Nault Professor of Law at Capital University. He served on the Federal Election Commission from 2000 to 2005.

https://www.nationalreview.com/2021/10/ ... eech-czar/
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