The Next Great Washington Crisis
Author: Greg Valliere
February 15, 2019
NATURE ABHORS A VACUUM and Washington needs another crisis. But the temperature may lower a bit — a border wall now faces protracted litigation; the Fed will be too worried about mediocre economic growth to think about rate hikes; talks with China will plod toward a resolution. So what’s the next crisis?
IT’S MUELLER TIME: Just because the special counsel’s office has been relatively quiet doesn’t mean the probe has stalled. It’s just the opposite; indictments are coming by the end of the winter — perjury, obstruction of justice, money laundering, etc. Maybe not collusion with Russia, which is difficult to prove, but indictments for perjury are very likely.
ONE THING IS CERTAIN: Mueller isn’t going away. He was a Marine Corps platoon leader in Vietnam; he was the recipient of a Purple Heart and the Bronze Star. He’s devoutly religious, has widespread support from Congressional Republicans and is a personal friend of William Barr, the just-confirmed Attorney General. Mueller will complete his probe — and release it — without interference.
IT’S SINKING IN THIS MORNING that officials at the Justice Department — who were appalled by Trump’s ties to Russia — seriously contemplated use of the 25th Amendment to force the president from office. Several of these officials considered wearing wiretaps when they met with Trump, according to Andrew McCabe and others. Virtually all of these officials think Trump was deeply indebted to Russia, which, they believe, arranged funding when his hotels and casinos were under water.
TWO HUGE WILD CARDS: Michael Cohen, the disgraced ex-Trump attorney, is known to be an obsessive taper — he reportedly taped most of his conversations with Trump, which is a huge legal threat to the president. The other wild card is the possibility that Trump might become enraged if Donald Trump Jr. or Jared Kushner are indicted. Trump could respond by firing the special counsel or issuing blanket pardons — which would precipitate a Constitutional crisis.
ODDS OF IMPEACHMENT: We haven’t changed our odds. Based on what we presently know, we think there’s a 55% chance that the activist House will impeach, but only a 25% chance that the Senate will convict this summer. We don’t see the required 67 votes in the Senate to oust Trump; the Democrats have only 47 seats. Would 20 Republicans vote against Trump? Unlikely, because these Republicans know how enormously popular Trump is within the party’s base.
JUST BECAUSE ODDS FAVOR ACQUITTAL doesn’t mean this will be an easy ride for the country — or the markets. The prospect of a messy trial, with the mercurial Trump tweeting against his tormentors, will surely make U.S. allies and adversaries worry about American political stability. Bottom line: we’re headed for uncharted waters, soon.
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