The Greatest Scientific Fraud Of All Time -- Part III

A few weeks ago, in mid-January, you would have had a hard time missing the big shouting and celebration in the global warming alarmist camp of 2014 being the "hottest year ever."  As just a few examples, there was Scientific American on January 5 ("2014 Officially Hottest Year On Record");  the BBC on January 16 ("2014 warmest year on record, say US researchers"); or the New York Times on January 16 ("2014 Breaks Heat Record, Challenging Global Warming Skeptics").   There were plenty of others like those.

If you read all of those articles, without doubt you will come away asking yourself one glaring question, namely:  So what did the satellites show?  Not one of these articles, or for that matter any of many others from the alarmist camp that I have looked at, so much as mentions the satellite data.  But anybody who follows this issue even a little knows that beginning in 1979 the U.S. government at great taxpayer expense has put up satellites with sophisticated instruments to get much more accurate measurements of world temperatures than previously available.  The alternative networks of ground based thermometers still exist, but have widely scattered coverage and are subject to large inaccuracies (like from having cities grow up around them, or having their sites moved over the years).  So SA, BBC, NYT: How could you insult our intelligence with articles trumpeting "hottest year ever" without telling us what the satellites say?

Luckily it's not too hard to figure out what the satellites say -- their data is published monthly by two sources, UAH and RSS.  Here's an article summarizing the results from both.  Of course it's exactly what you knew it would be as soon as you saw that the likes of the liars at SA, BBC and NYT wouldn't tell you what the satellites say:  2014 was not the hottest year, nor close, but rather tied for 6th/7th place in the 36 year record from RSS, 0.3 degrees C cooler than the warmest year, which was 1998 -- 16 years ago.  Now 0.3 degrees C may not be a lot, but it's also not a little in a record that only varies by about 1.2 degrees C from coolest to warmest year.

But it gets worse.  Regular readers of this blog know that there is a gigantic issue out there of the extent to which the ground thermometer records can be trusted because the guardians of the data (who are the same people putting out the press releases about 2014 being the "hottest year ever") have been systematically tampering with the data to make the earlier years cooler and therefore make the present appear warmer by comparison.  I previously wrote about this issue on July 3, 2014 ("What Is The Greatest Scientific Fraud Of All Time -- Part II") and on July 19, 2013 ("What Is The Greatest Scientific Fraud Of All Time?")  Those articles name names, both of the crooked U.S. government paid fake scientists who "adjust" the raw thermometer data without explanation to fit the desired narrative of "hottest year ever," and also of the independent researchers who laboriously track down old archived temperature records to uncover the tampering.

Just today this issue is starting to explode.  It was at the top of Drudge earlier today, although now gradually falling back.  Drudge linked to an article by Christopher Booker in the UK Telegraph from Saturday titled "The fiddling with temperature data is the biggest science scandal ever."  (Wait, are they stealing their headlines from me?  OK, not quite.)  Booker discusses the work of Paul Homewood, reported on his blog notalotofpeopleknowthat.  Sample (from Booker):

Homewood has now turned his attention to the weather stations across much of the Arctic, between Canada (51 degrees W) and the heart of Siberia (87 degrees E). Again, in nearly every case, the same one-way adjustments have been made, to show warming up to 1 degree C or more higher than was indicated by the data that was actually recorded. This has surprised no one more than Traust Jonsson, who was long in charge of climate research for the Iceland met office (and with whom Homewood has been in touch). Jonsson was amazed to see how the new version completely “disappears” Iceland’s “sea ice years” around 1970, when a period of extreme cooling almost devastated his country’s economy.

Homewood has also uncovered massive tampering from Paraguay.  John Hinderaker of Power Line includes numerous animated GIFs from Homewood demonstrating the data tampering from Paraguay.  Homewood adds his work to the extensive output of Tony Heller (who blogs under the name Steven Goddard) of realscience.  Heller has uncovered and reported on data tampering at dozens of sites.  Just today he reports on Addison, New York.  In every instance, whether Siberia, Paraguay, or upstate New York, it's always the same thing -- the past has been cooled to make the present look warmer by comparison.  But how could the past somehow have suddenly gotten cooler, 50 or 80 or 100 years after the fact?

Lots and lots of people have demanded an explanation from the guys at NCDC/GISS who put out the adjusted/tampered data and then claim "hottest year ever."  They won't give any.

So, Scientific American, BBC, New York Times, and all the rest of you who uncritically report the greatest scientific fraud of all time as if it was the truth:  When are you going to tell us the real story?

How Stupid Are Our Economic Forecasters?

Following up on yesterday's post, I thought it would be interesting to look at the economic forecasts of the geniuses who make those things for our government, and see how well they did at forecasting the effects of the 2009-2011 "stimulus" and of the 2013-2014 "sequester."  Turns out that economist Scott Sumner at the Library of Economics and Liberty had already done the work for me.  You literally will not believe how bad this is.

To understand this nonsense (OK, it's in the nature of nonsense that it's not really possible completely to understand it) you need to know a few things about the world view of these people.  They are "Keynesians."  In Keynesian world, the size of a government's fiscal budget surplus or deficit is thought to determine the degree to which the government is giving "stimulus" to its economy, or alternatively imposing "austerity."  More spending and lower taxes constitute "stimulus"; less spending and higher taxes constitute "austerity" (or sometimes, "fiscal tightening").  They then cook up forecasting models in which "stimulus" causes the underlying economy to grow and "austerity" causes it to shrink.  In other words, the more money the government wastes and the faster they waste it, and the more debt they run up, the more successful the country will be!  You would think it would not be possible for people in positions of high responsibility to believe such things, but you would be wrong.  180 degrees wrong.

In the second half of 2012, Congress and the President had previously agreed on a budget-control program known as the "sequester," which was scheduled to take effect in January 2013 unless the two first came to some other agreement.  In August 2012, supposedly to inform the debate, the Congressional Budget Office came up with forecasts of how the economy would perform under two scenarios, one assuming that the "sequester" occurred, and the other assuming that it did not.  At the time of the forecasts, Fiscal Year 2012 was nearing a close (FYs end on September 30), and the deficit for that year was looking to come in at somewhat over $1 trillion.  (The final deficit for FY 2012 was $1.087 trillion, per numbers here.)  The CBO looked at the various spending cuts and expirations of tax breaks scheduled to occur as part of the sequester, and projected that with the sequester the FY 2013 deficit would be $641 billion, and without the sequester the FY 2013 deficit would be approximately $1 trillion.  In other words, there would be a difference of close to $400 billion of "austerity."

Here is the CBO August 2012 forecast of how the economy would perform under the "austerity" conditions of the sequester:

The deficit will shrink to an estimated $641 billion in fiscal year 2013 (or 4.0 percent of GDP), almost $500 billion less than the shortfall in 2012.   Such fiscal tightening will lead to economic conditions in 2013 that will probably be considered a recession, with real GDP declining by 0.5 percent between the fourth quarter of 2012 and the fourth quarter of 2013 and the unemployment rate rising to about 9 percent in the second half of calendar year 2013.

And here's the CBO forecast of how the economy would perform in the alternative scenario where the sequester was averted and the deficit was allowed to continue at about $1 trillion:

The economy would be stronger in 2013: Real GDP would grow by 1.7 percent between the fourth quarter of 2012 and the fourth quarter of 2013, and the unemployment rate would be about 8 percent by the end of 2013, CBO projects.

No real-world economic experiment is ever completely perfect, but this one is about as close as you can get.  The sequester ended up getting delayed a couple of months to March 2013, but otherwise largely implemented, and the final deficit for FY 2013 came in at $680 billion, which is just slightly higher than the $641 billion used by the CBO in its projection for the sequester scenario.  So did the economy go into recession as they predicted?  Sumner:

Obviously the economy did much better than the negative 0.5% RGDP growth and 9% unemployment in late 2013 that were expected by the (Keynesian) CBO. But even more strikingly it did far better than the 1.7% RGDP growth and 8% unemployment at yearend in the alternative scenario.  In fact, RGDP grew 3.12%, and unemployment fell to 6.7%.

It's almost impossible to believe how badly wrong they could be.  And this is what passes for the advice that our Congress gets in trying to decide how much of the taxpayers' money to spend.

So, you ask, is this just an aberration, or are they always so bad?  Obviously you don't pay close attention to these things.  They were absolutely just as bad the previous time they had to make a call that really counted, namely in advising as to the effect of implementing a "stimulus" package as the economy entered recession in 2008/09:

Do you remember the Great Stimulus Experiment of 2009? The time that the unemployment rate didn't just rise much more than expected in response to the stimulus, it rose far more than expected under the alternative scenario of no stimulus!

Arnold Kling comments that "Facts do not change minds."  And remember, it's not just the American CBO that has drunk the Keynesian Kool-Aid in economic forecasting.  It's all of Europe, Japan, and for that matter the IMF in all of its advice to poor third-world countries.

And to end, should we quote Official Manhattan Contrarian Worst Economics Writer Paul Krugman on his February 2013 prediction as to the effect of the upcoming sequester?

[T]he legacy of that year of living foolishly lives on, in the form of the “sequester,” one of the worst policy ideas in our nation’s history. . . .  [T]he doomsday machine will go off at the end of next week.. . .  We should be spending more, not less, until we’re close to full employment; the sequester is exactly what the doctor didn’t order.. . .  This would hit the nation with a double whammy, reducing growth while increasing injustice.

And lots more hyperbole and invective where that came from.  Facts will never change his mind.

Government Spending And The U.S. Economy

Official Manhattan Contrarian Worst Economics Writer Paul Krugman begins his New York Times column today as follows:

On Monday, President Obama will call for a significant increase in spending, reversing the harsh cuts of the past few years. He won’t get all he’s asking for, but it’s a move in the right direction.

I love how the term "cuts" never appears alone, but always paired with "harsh."  It's like sunrise in Homer -- never just the "dawn," but always the "rosy-fingered dawn."  Is there any possible reduction in government spending that Krugman would ever concede was not "harsh"?  Doubtful.  Anyway, Krugman goes on to argue, as usual, for vast added government spending to eliminate the remaining slack in our economy.

But what is the actual recent evidence of the effect of government spending on the U.S. economy?  If you read Krugman and the rest of the Keynesian commentariat, you very likely have the impression that the sharp recession of 2008 was cured by the "stimulus" of 2009, and then things improved until the "harsh cuts" of the "sequester" of 2013 ruined everything.  Does the evidence match up with that narrative even a little?  The short answer is: No.

Here is a chart from the Tax Policy Center of actual federal government spending by year.  They give it in both nominal and inflation-adjusted dollars.  I'll type out some of the relevant numbers, and hope that the format comes out somewhat comprehensible:

                                                 Current dollars                           Constant 2009 dollars

FY 2007                                    2,728.7                                          2,829.7

FY 2008                                    2,982.5                                          2,988.5

FY 2009                                    3,517.7                                          3,517.7

FY 2010                                    3,457.1                                          3,416.8

FY 2011                                    3,603.1                                          3,492.4

FY 2012                                    3,537.1                                          3,365.2

FY 2013                                    3,454.6                                          3,234.0

FY 2014 (est.)                          3,650.5                                           3,367.3

FY 2015 (est.)                          3,901.0                                           3,532.5

To my somewhat jaundiced eye, what that looks like is that the "stimulus" caused a jump in government spending of around $500 billion per year in 2009 and 2010, and then the spending just ratcheted up to the new level and never went back down like it should have.  Wasn't the "stimulus" supposed to be just a temporary thing to get the economy going again?  And then the so-called "sequester" of early 2013 looks here like a just-perceptible dip of about a $100 billion cut in spending, immediately overcome with increases the following year.  (However, holding the line on spending has had the effect of reducing government spending as a percent of GDP from a peak of 24.4% in 2009 to about 21% today.)  Today constant dollar spending remains multi-hundreds of billions higher than the pre-stimulus baseline of 2008.  Can you spot the "harsh cuts"?

And how did employment react to the changes in government spending?  Here's a chart from the good people at Department of Numbers showing the two U.S. employment surveys -- green line representing the household survey, and blue line representing the employer survey.  (What, you didn't know that our government publishes two different series for the number of jobs, and that they differ by about 7 million in any given month?) 

Sure looks there like the number of jobs just kept falling during the first year of the "stimulus" (approximately March 2009 to March 2010) and was rather flat during the second year (March 2010 to March 2011), particularly in the broader household survey.  But there is relatively steady job growth, and certainly no diminution, after the "sequester" kicked in in about March 2013.

Unemployment rate?  According to BLS data here, during the "stimulus" period (approx. March 2009 to March 2011) it actually increased from 8.7% to 9.0%.  Since the "sequester" began in March 2013, it has gone down from 7.5% to 5.6% -- almost 2 full percentage points in the right direction.

We'll soon get another real-world experiment from Greece on the effects of blow-out government spending.  Time to place your bets on how that one will work out.  I know what my bet is.

The Ongoing March To Perfect Fairness And Justice

Here in Manhattan it is well known to everybody (with the exception of myself) that perfect fairness and justice between and among all people can easily be achieved by the simple device of the government ordering that it be so.  Housing is scarce and expensive?  Order that it be made "affordable"!  Wages aren't high enough?  Order that they be increased!  Food is too expensive?  Order that it be free or subsidized!

Most of the time the conventional press in New York won't provide any information at all on how these kinds of solutions work out in the real world.  Which makes this past week highly unusual -- on Thursday, the New York Times ran not one but two front page articles that provided some details on two different coercive redistribution schemes in two very different contexts.

First, from Caracas, William Neuman reported on the ongoing disaster in Venezuela.  His article actually provides some real information, mixed in with some of the usual Times spin.  There is a picture of lots of empty shelves in a store, and another one of a huge line of people who have come to get their weekly ration of government-subsidized staples:

The basic take of the article, set out in the headline ("Oil Cash Waning, Venezuelan Shelves Lie Bare"), is that the problems mostly stem from the recent decline in oil prices.  Current strongman Maduro is quoted as attributing the situation to Venezuela's "right wing enemies":

[Maduro] reiterated his position that the country’s economic ills are the fault of an economic war being waged against his government by right-wing enemies.

But Neuman also devotes space to some basic economic sense:

Many economists argue that government policies are a big part of the problem, including a highly overvalued currency, price controls that dissuade manufacturers and farmers, and government restrictions on access to dollars that have led to a steep drop in imports.

There's even a hint that Venezuela's economic problems pre-dated the decline in oil prices:

Even before oil prices tumbled, Venezuela was in the throes of a deep recession, with one of the world’s highest inflation rates and chronic shortages of basic items.

You won't find details in the article of when Venezuela's recession started or how bad it was well before the price of oil started its tumble in July 2014.  For some information on that, try the Manhattan Contrarian from August 2013 here.  Venezuela's official GDP numbers are thoroughly dishonest, but from the combination of falling industrial production, massive inflation, and empty store shelves, it's been obvious that Venezuela's economy has been in serious decline since at least 2012, and probably long before that -- even as the price of oil held between about $90 and $110 per barrel for multiple years from 2011 to 2014.

And finally this on the end game of the perfect-fairness state:

On a recent morning, hundreds of people stood in line outside a big-box store, similar to Costco. Inside, many shelves were stripped clean. The large appliance and electronics section was empty. . . .   Most people came to buy only three items sold at government-mandated prices: laundry detergent, vegetable oil and corn flour.  Every purchase was entered into a database, ensuring that shoppers did not try to buy the same regulated staples at the chain for at least seven days.  Soldiers patrolled the line outside, police officers were stationed inside and government officials checked identification cards, looking for fake ones that could be used to cheat the rationing system.

Well, thank God we have soldiers with guns to be sure that no one gets more than their fair share of vegetable oil!  And how much do you want to bet that those "government officials [who] check identification cards" are the highest paid people in this system?

And then, on the same day, another article about lines:  "Long Lines, and Odds, for New York's Subsidized Housing Lotteries," reported by Mireye Navarro.  Navarro lets us in on how it's going with Mayor de Blasio's efforts to create perfect housing fairness by coercing production of some "affordable" units and then allocating those units by lotteries.  Here's the report on two recent high-profile lotteries:

Last year, a new building in Greenpoint, Brooklyn drew 58,832 lottery applications for 105 affordable units. Not far behind was the Sugar Hill development in Upper Manhattan, which drew more than 48,000 applicants for 98 apartments.

So there were well more than 100,000 applicants for about 200 apartments -- that's a success rate of around 0.2%.  And what happens to the other 99.8%?  They get to spend endless hours filling out forms and standing around in lines.  Here's a picture of people signing up to attend a "workshop" on how to get in on the lotteries:

And even aside from the hopeless shortage of these apartments, somehow perfect fairness keeps eluding us.  Navarro reports that some are complaining because they were excluded from the lotteries for being just above the income cutoffs; others are complaining because their income was below the cutoffs; yet others are complaining because they work multiple and temporary jobs and can't document their income to the penny:

[A]bout three-fourths of the applicants who had been screened were rejected, mostly because their earnings were too low (income requirements ranged from $13,866 to $79,700, depending on the apartment size) or they failed to provide the necessary paperwork. Some missed out by as little as $25 a year, the developer said.  Other applicants had trouble producing tax records or proving their creditworthiness because their employment histories included numerous or short-lived low-paying jobs that are harder to document. And in the months that it took to sort through the candidates, some applicants lost their eligibility because their earnings or family size had changed. (Tenants already moved in are not forced to leave if their circumstances change.)  “Hundreds of people were excluded for reasons that were not rational,” Ellen Baxter, the executive director of the Broadway Housing Communities, said of the city’s lottery rules.

But I thought there were all-knowing, perfectly fair, perfectly neutral bureaucrats who could swoop in and allocate everything with exquisitely perfect fairness.  What am I missing?

Check out some of the many comments to this article.  Lots of them point out the folly of rent regulation, and that we have inflicted expensive housing upon ourselves by one crazy policy after another.  Could it be that New Yorkers are starting to catch on?  It's a small minority, but it seems that some of them read the New York Times.

Where Were Silver's Critics Before Last Week?

Just a week since Sheldon Silver's arrest, and all over the place his former supporters in the media have turned on him.  The New York Times called for Silver's resignation from the Assembly on January 22, the very day the federal criminal charges against him were announced.  The New York Observer called for his resignation on January 27 -- but hey, they're only a weekly paper.  In the blogosphere, the Daily Kos said "Silver Must Go" on January 26.

What I don't understand is where these guys, and lots of others like them, have been for the last twenty years.  The fact is that there's very little really new in the Silver charges other than that Preet Bharara signed his name to them and attached the dubious label of "criminal" to conduct most of which all thinking people long knew was occurring.  Why does the imperative to get rid of Silver somehow turn on Mr. Bharara's now having stated his opinion that Mr. Silver's long-running and well-known conduct fits the amorphous term "deprivation of the intangible right to honest services"?

Let's consider what we knew about Silver's activities prior to January 22, and what inferences would be drawn from that by any reasonable person.  Silver's public disclosure forms are summarized in the criminal complaint against him, available here.  From these disclosure forms alone, we knew that Silver was "of counsel" to a law firm called Weitz & Luxenberg since at least 2002, and that he received gradually increasing amounts of income from that law firm, topping $250,000 per year in 2005 (and every year thereafter), topping $350,000 in 2012, and topping $650,000 in 2013.  From Weitz & Luxenberg's web site, we knew that they are a prominent plaintiff's personal injury law firm mainly specializing in litigation involving asbestos exposure and medical devices.  From the legal press more generally, we knew that W&L in fact has the largest market share in New York among law firms in the asbestos exposure business.

And now for obvious inferences.  Silver was heavily occupied as Speaker of the Assembly and it would not be reasonable to think that he was spending his days interviewing clients, deposing witnesses or arguing in court.  Obviously the income he received from W&L was not based on his own hours doing legal work, but rather on his referrals of clients to the firm.  And why might such clients be referred to the firm through Silver?  Well, Silver had very tight control over a vast state empire of handouts and giveaways to the favored and predation on the disfavored.  Is it really possible that with dozens of clients getting referred to W&L via Silver -- enough clients to generate hundreds of thousands of dollars per year in referral income -- that none of it had anything to do with at least some hope or prospect of favorable treatment from this vast empire?  Of course that was not possible, and of course we knew it.

So where was the New York Times (or any of the other New York left wing press) calling for the ouster of Silver for corruption any time before now or endorsing his opponent in any election?  I sure can't find it.  (There were a few calls for Silver to leave a couple of years ago over an issue of secretly settling charges of sexual misconduct against a member of his staff.)

The fact is that New York's vast empire of state-granted handouts and predation is inherently corrupt and corrupting.  There are many billions of dollars at stake every year in the redistributions that come before the legislature.  In the real estate area alone, the legislature controls the rent regulation regime, which can be altered at any time to take large sums away from real estate investors; that regime is up for renewal later this year.  And then there are the tax breaks (e.g., "421(a)") used to get so-called "affordable housing" built.  Those can be eliminated at any time.  Of course the real estate industry is desperate to do some kind of favors for the pols who pull the strings.  The same goes for the participants in every other area where the government takes from some and gives to others.  For example, don't get me started on the "anti-poverty" scam.

But the reason that the New York Times and the others were not calling for the ouster of Silver is that they basically support the regime of passing out of economic benefits by the state.  They think that government distribution of favors can create perfect social justice and they do not recognize this regime as an inherent source of fundamental corruption.

Getting rid of Silver is not going to fix this problem.  The new person will be just as venal.  Very few people can resist these kinds of temptations.  Nor will criminal prosecution of everyone ever be a solution.  There are plenty of ways to do favors and enrich people that will not be clear "bribes" or "kickbacks" that the criminal law can effectively address.

The only solution is shrinkage of the state redistribution apparatus.  That means electing candidates with a political philosophy the complete opposite of Silver.  Of course, that runs directly contrary to the New York conventional ignorance, which holds that the basic function of government is to take from some and give to others to achieve perfect fairness between and among all people.  Well, you don't get fairness; you get corruption.

If you're wondering where the Manhattan Contrarian was on the subject of Silver before January 22, try here and here.

Is Sheldon Silver A Criminal?

Those of you West of the Hudson may not know the name Sheldon Silver, but as Speaker of the New York State Assembly he is one of the three most powerful men in New York politics (the other two being the Governor and the Majority Leader of the State Senate).  On Thursday Silver was arrested by Federal authorities under the direction of the U.S. Attorney for the Southern District of New York, Preet Bharara.

Before getting to the specifics of the allegations against Silver, I must say that I can't stop thinking about a story that a friend told me a number of years ago.  She stepped out onto the porch of her suburban house and spotted on the front step two different-color snakes coiled around each other.  She was wondering why this would be, when suddenly the two tensed up tightly, and then after some seconds, relaxed again.  And after a little more time, they tensed again, and then again relaxed.  And this behavior was repeated several times.  Gradually, she realized that they were locked in a struggle to the death.   After a while she left, but came back later, to find only one snake where before there had been two -- except that the tail of the second snake was protruding slightly from the mouth of the one that remained.

When it's two serpents, the good thing is that you don't really much care which one wins.

Silver is the complete antithesis of what I would want in a politician.  In his world state politicians exist to pass out favors to special interests, and the special interests then fund the political campaigns to keep the politicians perpetually in power.  Special interest Exhibit A is the teachers union, which according to the New York Post on January 19 spent $4.7 million in 2014 on political contributions (essentially all to Democrats) and lobbying.  Silver is then the key guy for the union in preventing the expansion of charter schools, watering down proposals for teacher evaluations, stopping merit pay, keeping it impossible to fire a teacher, and so on.  For the public employee unions more generally -- who collectively are the dominant political donors in New York -- Silver prevents pension reform, and also undermines employer bargaining power by insuring that pay increases continue even after contracts have expired.  Other major donors include real estate interests and taxi medallion owners who live off state-granted political favors.  It's all completely corrupt and greatly undermines the economic competitiveness of New York.  But none of this is a subject of this new Federal Complaint against Silver.  Also, all this information is well-known, and Silver's constituents keep electing him, most recently with 76% of the vote.

The fact that Silver is completely corrupt does not mean that Bharara has charged him with anything that does or should constitute a crime.   Here's a copy of the prosecutors' Complaint setting out the charges against Silver.  My main take is that there is almost nothing there.

The main charges against Silver are mail and wire fraud under 18 U.S.C. Section 1341, combined with "deprivation of the intangible right to honest services" under 18 U.S.C. 1346.  Section 1341 makes it a crime to engage in "any scheme or artifice to defraud, or for [the] obtaining [of] money or property by means of false or fraudulent pretenses, representations, or promises."  In reading the Silver Complaint, be on the lookout for any of those "fraudulent pretenses, representations, or promises."  You won't find any.   It's not that Silver hasn't made lots of false statements to the public, and this Complaint is full of them.  But if that were a crime every politician would be in jail.  "Fraud" requires not just the false promise but also reliance on it in giving up something of value.  In most to all political corruption cases, the crooked pol hasn't made a false promise to anybody to extract money, and that very issue became a persistent problem for federal prosecutors trying to put away state politicians under the mail and wire fraud statute.  And so Congress in 1988 added the following words in Section 1346:

For the purposes of this chapter, the term “scheme or artifice to defraud” includes a scheme or artifice to deprive another of the intangible right of honest services.

Can you understand what that one means?  Neither can I.  And we're in good company -- neither could the Supreme Court.  In 2010 the conviction of Jeffrey Skilling, one-time CFO of Enron, reached the Supremes.  Now, if ever there was a corrupt guy, he was it.  But he was convicted under this "deprivation of the intangible right to honest services" thing, and on appeal he very appropriately challenged that statute as void for vagueness.  The Supreme Court agreed, and vacated his conviction.  In my view it should have invalidated the statute entirely, but it did not; instead (per Justice Ginsburg) it held:

Construing the honest-services statute to extend beyond that core meaning, we conclude, would encounter a vagueness shoal. We therefore hold that § 1346 covers only bribery and kickback schemes. 

I won't even try to explain to you how Justice Ginsburg was able to discern from the statute that it clearly covered "bribery" and "kickbacks," but was too vague as to everything else, when the statute doesn't ever use the words "bribery" or "kickback" or say anything about those things.  But at least as to everything other than bribery and kickbacks, this was not even close.  The decision was unanimous, 9-0.  Three justices -- Scalia, Thomas and Kennedy -- joined a concurring opinion that said the statute should have been invalidated in its entirety. 

And thus, since 2010, to convict someone of this "deprivation of the intangible right to honest services" thing, the federal prosecutor must prove either "bribery" or a "kickback."

That brings us to the prosecution of Joe Bruno.  Not so long ago -- up to 2008 -- Joe Bruno was the other legislative member (along with Silver and then-Governors Pataki and Spitzer) of the three most powerful men in New York, namely Bruno was the Majority Leader of the State Senate.  That is, he was until he attracted the attention of the federal prosecutors, this time from the Northern District of New York.  And what do you think they charged him with?  You guessed it: "deprivation of the intangible right to honest services."  The basic allegation was that Bruno had gotten paid for "consulting" when he had done little or no work, while the guy paying him had business of some kind before the state.  So what was the "bribery" or "kickback" there?  The prosecutors were completely vague about it, but this was before the Skilling case.  After charges were brought, Bruno retired from the State Senate in 2008.   In 2009 he was convicted on two counts (although acquitted on many others).  While Bruno's case was on appeal, the Skilling case came down from the Supreme Court.  Oops!  In 2011 the Second Circuit reversed Bruno's conviction in light of Skilling.  If the prosecutors had had any decency, they would have walked away at that point; but they don't have any decency.  Bruno was then re-tried in early 2014, but the prosecution now struggled to prove what it was that Bruno had supposedly done as a quid pro quo for his client that made the consulting payment a "bribe."  The jury acquitted Bruno on all charges.  In the final insult in the Bruno case, the Post reported in its Christmas 2014 edition that the State of New York had grudgingly agreed to pay Bruno's legal fees for his completely successful defense.  Yes, that was just a month ago.

OK then, what is the "bribe" or "kickback" that Silver is charged with -- in other words, what is the explicit quid pro quo between Silver and the briber and/or kickback recipient? Given the holding of the Supreme Court in the Skilling case and the extremely recent debacle of the Bruno prosecution, you would think that the prosecutors would know that this point is their Achilles heel and would address the issue squarely and directly in their Complaint.  You would think.

Back to the Federal Complaint.  Starting on page one we find that the prosecutors are savvy enough to use the magic words "bribes" and "kickbacks" in their opening allegations ("SILVER used the power and influence of his official position to obtain for himself millions of dollars in bribes and kickbacks masked as legitimate income").  OK, we can see that at least you have read the Skilling case.  But how about some specifics as to quids and quos?

And then we go all the way to page 17 with lots of allegations obviously designed to paint Silver as a bad man, but only evasiveness as to the quids and quos.  Are you starting to get the sense that they are dodging something? 

• In paragraph 9: "For more than a decade SILVER repeatedly has represented publicly that his outside income as a private lawyer is derived from private citizens who seek him out for legal services in personal injury matters, and that none of his clients has any business before the state."  OK, suppose this is all false.  Why is it a Federal crime?  Where is the bribe or kickback?
• On pages 10 to 13, quoting and flyspecking of Silver's state financial disclosure forms.  He said his income was "predominantly" from a personal injury law firm, but got an eighth or so of it from a real estate law firm!  It's a state crime to make a false statement on one of these disclosure forms!  (OK, but is it a Federal crime?  If not, why are you wasting our time?)
• On page 17, a long list of payments received.  OK, why is it a crime?

Finally, on page 17, paragraph 27:

SILVER . . . obtained approximately $4 million of the income described above in exchange for his corrupt and secret use of his official position through at least two different means and methods: (i) steering real estate developers with significant and continuing business before the State to the Real Estate Law Firm, in exchange to kickbacks paid to him by CC-1 for such referrals, and (ii) soliciting and obtaining referrals to Weitz & Luxenberg from Doctor-1 in return for directing State grants to Doctor-1's research . . . ."

Wait a minute -- payments from people having "business before the state" without any specifics as to a quid pro quo -- wasn't that exactly where the Bruno prosecution foundered?  OK, let's take the two pieces one at a time.     The next seven pages of the Complaint, 17-24, deal with item (i), steering real estate developers to the Real Estate Law Firm.  And for page after page it's all about technicalities of when lawyers can do fee-splitting under the ethical rules and whether Silver complied with all the technicalities -- yes, yet again, it is seven more pages of nothing to do with a Federal crime.  And then finally on page 24, we get to all they've got on the supposed quid pro quo:  "A document . . . from the Moreland Commission, which was prepared by an entity that represents real estate developers, stated in connection with the 2011 rent regulation reauthorization that SILVER was considerably more favorable to the real estate industry than expected. . . .  It would appear that he [Silver] could have successfully pushed for more."

Well, there's a gigantic nothing-burger!  Can't they even name the specific favor that was sought and delivered?  Oh, and did I mention that they conceded back on page 22 that the main entity ("Developer-1") whose real estate business was referred to the "Real Estate Law Firm" only had disclosed to it that Silver was receiving a part of the fees in December 2011 -- several months after the rent regulation reauthorization was complete -- and that that developer was then "concerned and surprised that Silver appeared to have been getting money from Developer-1 through the Real Estate Law Firm."  What exactly kind of "bribe" is that, where the alleged briber doesn't even know that the bribee is getting any money, doesn't find out about it until after the supposed "quo" has been delivered, and is "concerned and surprised" when he finds out? 

And one final thing about this alleged "bribe" from the real estate industry.  Not "successfully pushing for more" in the 2011 rent regulation reauthorization -- if Silver actually did it, which is dubious -- would probably be the only time Silver has ever done the right thing for the bulk of the voters and taxpayers in New York in his entire career.   In this Complaint, doing the right thing by voters and taxpayers is considered payoff for a bribe.

So we turn to item (ii) in paragraph 27 of the Complaint, Silver's relationship with Weitz & Luxenberg.  Over a period exceeding ten years, Silver is alleged to have received several million dollars of fees from W&L, apparently almost entirely based on case referrals from a "Doctor-1," identified as a leading mesothelioma researcher in New York.  The gist of the allegations is that Doctor-1 referred his patients to W&L to bring their cases and in return Silver directed some $500,000 in state money to Doctor-1's mesothelioma institute to support his research.  OK, that's at least a start.  But permit me to mention at least a few issues on the way to trying to prove that this was a bribe:

• There is no mention in the complaint that Silver or anyone on his behalf ever told Doctor-1 that he could get state money for his research if he referred cases to W&L.  Rather, the Complaint states that Doctor-1 first asked Silver if W&L would support his research, and Silver said it would not, and in the face of that Doctor-1 referred cases without any other promise (page 26).  The state money came several years later.
• There is no mention of what portion, if any, of the $500,000 went to Doctor-1 himself.
• After the state funding ended in about 2008, Doctor-1 continued to refer cases to W&L through Silver. 

And I should mention that there appears to be a significant statute of limitations problem in these allegations.  I don't claim to be an expert in criminal statutes of limitations, but the general statute for Federal crimes is 5 years.  So what state benefit has Silver directed to Doctor-1 in the past 5 years?  You need to get all the way to page 29 for that, and it consists of presentation of an award and making a speech praising Doctor-1 for his research, and helping a family member get a job.  Really?

Don't get me wrong -- I think that Sheldon Silver is corrupt through and through and in every pore of his being.  But that doesn't mean that he is guilty of a Federal crime.  Sheldon Silver is just the inevitable product of the New York progressive fantasy.  We concede to the state more and more power supposedly to create perfect fairness by redistribution of economic resources, and what we get is pols who pull the levers of a vast state favor mill to create benefits for the pols' friends and supporters, and those friends and supporters then pass on business opportunities that make the pols rich.  It is not within the possibilities of the criminal law to do away with this. 

And is Preet Bharara any less corrupt?  This is the guy who has convicted dozens of people for the non-crime of non-insider insider trading and engaged in one shakedown after another of the big banks.  Bringing the full resources of the Federal Government to bear to seek to convict someone or coerce a settlement for something that is not a crime -- is that any less evil than what Silver is accused of in this Complaint?  On the same day that Bharara's office arrested Silver, a judge in the Southern District of New York vacated four of Bharara's convictions for non-insider insider trading in light of the Second Circuit's Newman/Chiasson decision.  I'll bet you didn't even notice that one -- it was wiped off the front pages by the Silver arrest.

Can't say I really care which of these two serpents wins.