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Donald Trump is ordered to pay for his bullying

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If ordered to pay millions of dollars for defaming someone, most people would learn their lesson and zip it. Not so Donald Trump. Last May a jury in Manhattan determined that he owed E. Jean Carroll, an advice columnist, $5m in damages for sexually assaulting her nearly 30 years ago and then, in 2022, accusing her of making it up. Unbowed by the judgment, he called her a “whack job” on cnn the next day and denied ever having met her (even though they were photographed together). “I have no idea who the hell she is,” he protested.

Mr Trump now has a big new incentive to restrain himself, thanks to a whopping judgment in a separate but related defamation trial. On January 26th a different jury awarded Ms Carroll $83m for another set of insults and denials over the assault, these ones made by Mr Trump in 2019. Punitive damages represented four-fifths of the total—a sum clearly intended to deter the presumptive Republican nominee for president from defaming Ms Carroll again. Her lawyers had asked for $24m in compensatory damages and “an unusually high punitive award”. Mr Trump called the verdict “absolutely ridiculous!” in a social-media post, and vowed to appeal. The sum may well be reduced: calculating reputational harm is inherently subjective. But at least for now the lesson appears to have sunk in. Mr Trump made no reference to Ms Carroll after the trial.

The case stems from an encounter at Bergdorf Goodman, a department store in New York, in the mid-1990s. Ms Carroll alleges that, while they shopped in the lingerie department, Mr Trump pushed her against a dressing-room wall and raped her. In 2019 she published a book describing publicly the attack for the first time. Mr Trump said it never happened and accused her of trying to juice book sales, adding, “she’s not my type.” In 2022 Ms Carroll sued him under a law that allowed sexual-assault victims a one-year window to bring claims outside the statute of limitations. At last year’s civil trial a jury determined that Mr Trump had “sexually abused” Ms Carroll but that he had not raped her. Those findings were not being re-litigated in this case. Lewis Kaplan, the judge who presided over both trials, said there would be no “do-overs by disappointed litigants”.

Mr Trump stayed away from the first trial, but he attended this one and testified, albeit for less than five minutes. Those appearances marked an effort to bring the campaign trail to the courthouse, to underscore the supposed lawfare being waged against him by Democrats (Reid Hoffman, a co-founder of LinkedIn and Democratic donor, helped finance Ms Carroll’s first case). Before Mr Trump’s testimony Judge Kaplan demanded to know exactly what he would say, lest he suggest that the attack never happened.

Sure enough when Mr Trump called Ms Carroll’s account “false” under oath, Judge Kaplan ordered it struck from the record. The defendant’s huffing and puffing—he stormed out during closing arguments—no doubt helped Ms Carroll’s case. “You saw how he has behaved through this trial,” her lawyer told the jury. “Rules don’t apply to Donald Trump.” Judge Kaplan also sparred with Mr Trump’s pugnacious lawyer, Alina Habba, who he warned might spend “some time in the lockup”.

Ms Carroll will not receive the full damages while Mr Trump is appealing against the decision, which may take months. If he has the amount in cash he could pay it to the court, which will hold it during the appeals process (as he did with the previous award to Ms Carroll). Or he could try to secure a loan against his other assets. Much of his money is tied up in property. Mr Trump likes to brag about his wealth—one of the reasons the jury opted to award such a thumping sum in damages.

More legal peril awaits Mr Trump, who stands accused of 91 felonies in four criminal cases. The first, a federal trial over his election interference in 2020, was scheduled to begin in March. But it is on hold until an appellate court rules on Mr Trump’s claim of immunity from prosecution for crimes committed in office.

In the meantime he can expect an even bigger penalty in yet another civil lawsuit in New York related to his real-estate business. In September Arthur Engoron, the judge overseeing that case, agreed with prosecutors that Mr Trump and his firm committed fraud by inflating the value of property to secure better loan terms. Letitia James, the state attorney-general, wants Mr Trump and his co-defendants to be fined $370m and barred from serving as a corporate director in the state of New York.

Judge Engoron will also have to clarify what he intended when he ordered the cancellation of corporate charters that enable the Trump Organisation to operate in the state. His initial ruling was unclear about whether he really meant for Mr Trump’s properties to be sold off and the business wound down. That would be a rare punishment: only a dozen companies in the state have been subjected to it in nearly 70 years. Whatever the penalty, it will probably be paused until Mr Trump appeals against it and the underlying fraud judgment, which will take months.

Stay on top of American politics with Checks and Balance, our weekly subscriber-only newsletter, which examines the state of American democracy and the issues that matter to voters.

Economics

Donald Trump sacks America’s top military brass

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THE FIRST shot against America’s senior military leaders was fired within hours of Donald Trump’s inauguration on January 20th: General Mark Milley’s portrait was removed from the wall on the E-ring, where it had hung with paintings of other former chairmen of the joint chiefs of staff. A day later the commandant of the coast guard, Admiral Linda Fagan, was thrown overboard. On February 21st it was the most senior serving officer, General Charles “CQ” Brown, a former F-16 pilot, who was ejected from the Pentagon. At least he was spared a Trumpian farewell insult. “He is a fine gentleman and an outstanding leader,” Mr Trump declared.

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Checks and Balance newsletter: The journalist’s dilemma of covering Trump

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Checks and Balance newsletter: The journalist’s dilemma of covering Trump

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Germany’s election will usher in new leadership — but might not change its economy

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Production at the VW plant in Emden.

Sina Schuldt | Picture Alliance | Getty Images

The struggling German economy has been a major talking point among critics of Chancellor Olaf Scholz’ government during the latest election campaign — but analysts warn a new leadership might not turn these tides.

As voters prepare to head to the polls, it is now all but certain that Germany will soon have a new chancellor. The Christian Democratic Union’s Friedrich Merz is the firm favorite.

Merz has not shied away from blasting Scholz’s economic policies and from linking them to the lackluster state of Europe’s largest economy. He argues that a government under his leadership would give the economy the boost it needs.

Experts speaking to CNBC were less sure.

“There is a high risk that Germany will get a refurbished economic model after the elections, but not a brand new model that makes the competition jealous,” Carsten Brzeski, global head of macro at ING, told CNBC.

The CDU/CSU economic agenda

The CDU, which on a federal level ties up with regional sister party the Christian Social Union, is running on a “typical economic conservative program,” Brzeski said.

It includes income and corporate tax cuts, fewer subsidies and less bureaucracy, changes to social benefits, deregulation, support for innovation, start-ups and artificial intelligence and boosting investment among other policies, according to CDU/CSU campaigners.

“The weak parts of the positions are that the CDU/CSU is not very precise on how it wants to increase investments in infrastructure, digitalization and education. The intention is there, but the details are not,” Brzeski said, noting that the union appears to be aiming to revive Germany’s economic model without fully overhauling it.

“It is still a reform program which pretends that change can happen without pain,” he said.

Geraldine Dany-Knedlik, head of forecasting at research institute DIW Berlin, noted that the CDU is also looking to reach gross domestic product growth of around 2% again through its fiscal and economic program called “Agenda 2030.”

But reaching such levels of economic expansion in Germany “seems unrealistic,” not just temporarily, but also in the long run, she told CNBC.

Germany’s GDP declined in both 2023 and 2024. Recent quarterly growth readings have also been teetering on the verge of a technical recession, which has so far been narrowly avoided. The German economy shrank by 0.2% in the fourth quarter, compared with the previous three-month stretch, according to the latest reading.

Europe’s largest economy faces pressure in key industries like the auto sector, issues with infrastructure like the country’s rail network and a housebuilding crisis.

Dany-Knedlik also flagged the so-called debt brake, a long-standing fiscal rule that is enshrined in Germany’s constitution, which limits the size of the structural budget deficit and how much debt the government can take on.

Whether or not the clause should be overhauled has been a big part of the fiscal debate ahead of the election. While the CDU ideally does not want to change the debt brake, Merz has said that he may be open to some reform.

“To increase growth prospects substantially without increasing debt also seems rather unlikely,” DIW’s Dany-Knedlik said, adding that, if public investments were to rise within the limits of the debt brake, significant tax increases would be unavoidable.

“Taking into account that a 2 Percent growth target is to be reached within a 4 year legislation period, the Agenda 2030 in combination with conservatives attitude towards the debt break to me reads more of a wish list than a straight forward economic growth program,” she said.

Change in German government will deliver economic success, says CEO of German employers association

Franziska Palmas, senior Europe economist at Capital Economics, sees some benefits to the plans of the CDU-CSU union, saying they would likely “be positive” for the economy, but warning that the resulting boost would be small.

“Tax cuts would support consumer spending and private investment, but weak sentiment means consumers may save a significant share of their additional after-tax income and firms may be reluctant to invest,” she told CNBC.  

Palmas nevertheless pointed out that not everyone would come away a winner from the new policies. Income tax cuts would benefit middle- and higher-income households more than those with a lower income, who would also be affected by potential reductions of social benefits.

Coalition talks ahead

Following the Sunday election, the CDU/CSU will almost certainly be left to find a coalition partner to form a majority government, with the Social Democratic Party or the Green party emerging as the likeliest candidates.

The parties will need to broker a coalition agreement outlining their joint goals, including on the economy — which could prove to be a difficult undertaking, Capital Economics’ Palmas said.

“The CDU and the SPD and Greens have significantly different economic policy positions,” she said, pointing to discrepancies over taxes and regulation. While the CDU/CSU want to reduce both items, the SPD and Greens seek to raise taxes and oppose deregulation in at least some areas, Palmas explained.

The group is nevertheless likely to hold the power in any potential negotiations as it will likely have their choice between partnering with the SPD or Greens.

“Accordingly, we suspect that the coalition agreement will include most of the CDU’s main economic proposals,” she said.

Germany is 'lacking ambition,' investor says

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