Running Interference

Running Interference

The mood was somewhat sour Thursday ahead of the last US presidential debate.

Reports that Iran and Russia managed to obtain voter registration information for US citizens undermined sentiment during the Asian session. The bad vibes lingered like stale cigarette smoke.

It doesn’t help that DNI John Ratcliffe — who made the announcement late Wednesday — has a rather large credibility deficit with the public, and especially with Democratic voters and lawmakers. Among other things, Ratcliffe is a sycophant vis-à-vis the Oval Office and made a name for himself with Donald Trump by berating Robert Mueller last year. One of his predecessors, Dan Coats, was notoriously wary of the president’s cordial relationship with the Kremlin.

Ratcliffe was a staunch critic of the Russia probe. It took two tries for Trump to get him installed in his current position. This is just another top post occupied by someone who cares far more about his relationship with the president than he does about his job. Consider that a man who openly supported the president’s characterization of investigations into Russian election meddling as a “witch hunt” is effectively in charge of ensuring Russia doesn’t interfere with the election. It’s absurd, but then again, what isn’t at 1600 Penn these days?

The bottom line is that Ratcliffe’s allegiance to the president runs far deeper than any dedication to national security and no serious observer would suggest otherwise.

FBI Director Christopher Wray was with Ratcliffe at the short press conference convened ahead of an imminent media scoop on the same topic. Wray is living under a cloud of speculation that he could be fired by Trump after the election.

Predictably, Ratcliffe said Iran is trying to undermine the president, allegations Tehran called “clumsy and fraudulent.” Denials notwithstanding, America’s track record of intervening in the country and the administration’s tireless efforts to choke the Iranian economy, not to mention Trump’s brazen assassination of Qassem Soleimani, do make Ratcliffe’s claims eminently plausible.

Still, Senator Chris Murphy wondered if perhaps Ratcliffe was just setting the stage for Trump to claim some manner of fraud after the vote. “The DNI knew for months there was a Russian agent who had penetrated Trump’s inner circle in order to spread fake anti-Biden propaganda,” Murphy reminded the public, in a tweet. There was “no press conference. Just a footnote in a Treasury sanctions announcement,” Murphy went on to remark.

None of this inspires confidence at a time when Facebook, Twitter, and Microsoft have all flagged foreign efforts to meddle with the election. “Officials have been warning for months about the risk of what are known as perception hacks: efforts to use a mix of easily accessible data to create the impression among voters that foreign powers are actually inside voting infrastructure,” The New York Times notes. “That perception alone, officials said, could shake confidence in the integrity of the vote – exactly what Russia has been seeking to do since its interference in 2016, when it scanned the contents of many state election systems and penetrated a few, including Arizona and Illinois, even if it did not change any votes.”

Trump later tweeted out a Breitbart story documenting Ratcliffe’s Wednesday evening announcement, underscoring the president’s rather unnerving penchant for frequenting web portals that traffic in overt propaganda, borderline hate speech, and content too abrasive even for Fox. It seemed lost on the president that it is his own tweets, actions, and rhetoric that helped Iran craft the strategy behind what national security officials say was a fake “Proud Boys” e-mail campaign.

“The US election looms larger and larger. This evening will be the final presidential debate between Trump and Biden, with a moderator the White House claims isn’t moderate, where none of the topics are on the foreign policy debate this format traditionally covers at this time, and where microphones can be switched off to mute the speakers,” Rabobank’s Michael Every mused, in his always entertaining daily missive. “The last one was hardly an edifying experience,” he added, noting that this final clash of the septuagenarians comes “in a weekly election news-cycle that has already seen Hunter Biden’s laptop, #MeToobin, Trump having a Chinese bank account, Borat’s daughter meeting Rudy Giuliani, and Iran alleged by the US to be pretending to be The Proud Boys via email(!).”

Meanwhile, Sino-US tensions continue to percolate. The Chinese Foreign ministry on Thursday derided Mike Pompeo’s crackdown on a half-dozen Chinese media outlets as “unjustified” and said Beijing would take “necessary responses.” Pompeo on Wednesday designated Economic Daily alongside a handful of obscure publications as “foreign missions,” effectively building on February’s move against Xinhua and four others.

Global Times editor Hu Xijin — widely known to speak on behalf of the Party — warned that “the US has gone too far,” before accusing Pompeo of “poisoning” the “working environment of media outlets in each other’s country.”

That presumably means you can expect more “problems” for American journalists working in China. One might even say that the State department is endangering American lives with these type of totally unnecessary provocations. It’s one thing to crack down on Huawei or file charges against alleged PLA operatives working at American universities. But picking on obscure periodicals seems like looking for trouble. It’s not exactly like the average American reads the Economic Daily, let alone the “Xinmin Evening News,” another of the outlets State targeted this week. It’s fair to say we’ve reached the point of diminishing returns on some of these petty broadsides.

On the stimulus front, Nancy Pelosi and Steve Mnuchin will attempt to finally strike an agreement that can be enshrined in a bill on Thursday, although Trump appeared to cast doubt on the talks in a tweet.

Rather than editorialize further around a subject that scarcely needs more blanket coverage, I’d simply say that even though no one expects an agreement to become law prior to the election, if the talks were to break down, it would likely trigger a risk-off move across assets for what it would say about the impossibility of bipartisanship in the face of a crisis.


One thought on “Running Interference

  1. A reasonable expectation is that the algos will spasm again. The rationale is that they have the biases of their creator (not god) embedded within. The unforeseen political events that do (most don’t) effect markets, end of the debt supercycle, and any announcements such esteemed organization as the IMF regarding the new monetary system, are too complex to understand, much less model. I guess it’d be called fat tail risks. Stuff we haven’t or can’t imagine, and unknowable interactions. We’ll see how they do.

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