Kash Patel likes conspiracy theories. Luckily for everyone else, conspiracists are normally kept far away from America’s federal law-enforcement and intelligence machinery, with all its powers of surveillance, investigation and arrest. Typically, though, Donald Trump has tested this premise in his choice of Mr Patel to lead the FBI. The 44-year-old lawyer—whose Senate confirmation hearing is on January 30th—has called that organisation “one of the most cunning and powerful forces of the Deep State”. If Mr Trump keeps his promise to retaliate against his enemies, the task will fall to his nominee.
Like Pete Hegseth, who won confirmation as defence secretary by a whisker, in pre-Trump times Mr Patel would have had little chance of running a government agency, let alone one this size. The FBI has 38,000 employees, 55 field offices and an $11bn budget. He lacks management experience, scorns the organisation, and his partisanship flouts a post-Watergate norm that law enforcement and intelligence gathering must be insulated from politics.
Mr Patel’s animus towards the national-security establishment started with the Trump-Russia probe. As a congressional aide, Mr Patel seized on real faults in the investigation, then exaggerated them. An FBI lawyer had doctored an email to support an application to wiretap a Trump campaign adviser; this was illegal, and Mr Patel helped expose it. In his telling, however, he discredited the whole inquiry as a nefarious plot to undermine Mr Trump, orchestrated by the justice department (DoJ) and the intelligence agencies. Mr Patel has called former top brass at the DoJ and the FBI corrupt “crooks” and “gangsters” and asked: “Who’s arresting these guys?”
Perhaps he will. An appendix to Mr Patel’s book names 60 deep-state baddies. Democrats call it the Trump administration’s “enemies list”. Steve Bannon, a MAGA troublemaker, recently conceded that the book “might not be a literary thing”—“more typing than writing”—but said that the list is a good preview of future targets. The president offered a more ambiguous preview on inauguration day when he ordered the attorney-general to scour the DoJ for past instances of lawfare and seek “remedial actions”. By lawfare he meant the two (now dismissed) federal indictments against him and the FBI’s raid of Mar-a-Lago, his Florida estate. Already more than a dozen DoJ lawyers who brought those cases have been fired.
Actual prosecutions against the president’s enemies would be hard. They would contend with judges, juries, defence lawyers and evidentiary rules. Investigations of the type Mr Patel would oversee involve fewer constraints. This is especially true when the FBI can cobble together a national-security justification. Then judicial review for, say, a wiretap becomes less burdensome. Everything is classified to boot.
At the FBI, a culture of complying with the law will militate against baseless expeditions, says Daniel Richman, a law professor at Columbia University and former adviser at the bureau under James Comey, the director whom Mr Trump fired in 2017. But line agents and prosecutors will find it hard to object to an inquiry where there is a coherent basis for one, even if the motives behind it are political. Meanwhile, probes exact punishing costs from their targets.
Mr Patel is especially keen on pursuing leakers and their friends in the media. “When you have an underlying illegality committed by a government agent, anyone that participates in that illegality can and should be charged,” Mr Patel has said. He has also suggested “clawback mechanisms” for the money that news outlets make “by printing lies”.
Equally significant is what Mr Patel might deprioritise at the FBI: namely, investigations of far-right activity. This may pick up as groups that went quiet after January 6th re-form thanks to Mr Trump’s pardons. Mr Patel has insinuated that the FBI had a hand in the insurrection. That is a MAGA conspiracy theory, built on the fact that 26 FBI informants were there that day, including four who entered the Capitol. In truth the riot was among the largest intelligence failures in FBI history.
The fact that Mr Patel is even in contention for the FBI job underscores how much has changed between the two Trump administrations. In the first term, the president moved to install him as deputy director of the cia. Gina Haspel, then its boss, threatened to quit and Mr Trump backed down. He tried the same gambit at the FBI before Bill Barr intervened. Both Ms Haspel and Mr Barr had stature accrued over long, distinguished careers; with that came the wherewithal to say no. Mr Patel, by contrast, owes his ascendancy to Mr Trump. On a podcast last year, he intimated how he would handle a lawful but awful order from the president. “If the guy gives me a lawful chain-of-command authority, you want me to not execute it?”■
U.S. economic growth slowed a bit more than expected in the final three months of 2024, the Commerce Department reported Thursday.
Gross domestic product, a measure of all the goods and services produced across the sprawling U.S. economy during the period, showed that the economy accelerated at a 2.3% annualized pace in the fourth quarter. Economists surveyed by Dow Jones had been expecting an increase of 2.5% after growth of 3.1% in the third quarter.
The report closes out 2024 on a somewhat downbeat note, though growth held reasonably solid. For the full year, GDP accelerated 2.8%, compared to 2.9% in 2023. Thursday’s release was the first of three estimates the department’s Bureau of Economic Analysis will provide.
Growth held up largely on the backs of consumers who continued to spend briskly despite the ongoing burden of high prices on everything from homes to cars to eggs at the supermarket. While inflation is well off the boil from its mid-2022 40-year high, it remains a burden for households, particularly those on the lower end of the income scale.
Consumer spending rose at a robust 4.2% pace and, as usual, amounted to about two-thirds of all activity. Government spending also provided a boost, accelerating at a 3.2% level.
Trade was a drag on growth in the period, with imports, which subtract from the GDP calculation, off 0.8%. Exports also declined 0.8%. Gross private domestic investment slumped by 5.6%, shaving more than a full percentage point off the topline number. An easing in inventories also cut nearly 1 percentage point.
In other economic news Thursday, initial unemployment claims totaled 207,000 for the week ending Jan. 25, a sharp decline of 16,000 from the prior period and well below the forecast for 228,000. Continuing claims, which run a week behind, also fell, down 42,000 to 1.86 million.
The resilience of the U.S. economy and the relative deceleration in inflation has allowed the Federal Reserve to assume a patient stance on monetary policy. Though the Fed cut its key interest rate by a full percentage point in the last four months of 2024, officials have indicated that aggressive reductions are unlikely this year.
At the recently concluded Fed meeting, central bankers gave no indication that they are expecting cuts anytime soon, with Chair Jerome Powell insisting that he is in no hurry to ease.
Fed officials have been expressing some concern about whether the moves lower in inflation have stalled. Thursday’s report showed that the so-called chain-weighted price index, which measures prices and accounts for consumers substituting less expensive products for more costly items, increased 2.2% on the quarter, faster than the 1.9% move in Q3 but slightly below the 2.3% estimate.
However, the data also showed that consumers are dipping into savings to fund their purchases. The personal saving rate was 4.1%, down 0.2 percentage point from the prior quarter for the lowest level in two years.
THE SPRAWLING al-Hol camp in north-eastern Syria is part of a network of prisons holding tens of thousands of detainees and family members from Islamic State’s jihadist “caliphate”, which was smashed by America and its allies in 2019. Western securocrats have long worried that prisoners might break out and wreak bloody havoc, in Syria and abroad. Such fears have intensified given the turmoil after the fall of Syrian dictator, Bashar al-Assad, in December.
There could scarcely be a worse time for the Trump administration to order, as it did on January 24th, an immediate halt to almost all aid work—at al-Hol and around the world—pending a 90-day review to ensure foreign assistance aligns with America First principles. The only exceptions were aid for Israel and Egypt (mostly military) and “emergency food aid”. Waivers could subsequently be issued on a case by case basis.
America is by far the world’s largest aid donor, spending $68bn in fiscal 2023, the most recent year. The US accounts for about 40% of all humanitarian assistance provided by governments. The announcement of an abrupt cutoff of much of this money hit humanitarian agencies like an earthquake. American-funded projects wobbled and some risked collapse.
The affected work included the distribution of antiretroviral drugs for people infected with HIV under a scheme known as PEPFAR, credited with saving some 26m lives since 2003; medical services for Rohingya refugees in Bangladesh; mine-clearing in South-East Asia; reconstruction of bombed-out energy infrastructure in Ukraine; pro-democracy work in Russia’s near-abroad; and much more.
“Every dollar we spend, every program we fund, and every policy we pursue must be justified with the answer to three simple questions: Does it make America safer? Does it make America stronger? Does it make America more prosperous?” the state department said.
Among the casualties were groups working at al-Hol, home to about 40,000 Islamic State (IS) fighters and their relatives, among them European women who married combatants and bore their children. The Kurdish-dominated Syrian Democratic Forces (SDF), which controls north-eastern Syria, is in charge of security at the camps. But aid workers speak of a free-for-all within. Women loyal to IS hold sway with guns and train a new generation of ideologues. The perimeter is pierced by tunnels, allowing weapons in and inmates out. Killings are commonplace. Children are sold as fighters. “It’s more an IS base than a prison,” says a Western researcher.
Blumont, the American firm that manages al-Hol (and a smaller camp called Roj) under a state department contract, says its teams left the camps when they received the stop-work order, and arranged for other groups to provide “very much reduced basic services”. Some humanitarian groups said they were issuing termination letters for their staff. On January 27th Blumont received a 14-day waiver and said its staff returned the next day.
Amid chaos and an outcry that countless lives were at risk, Marco Rubio, the secretary of state, later widened exemptions to include “life-saving humanitarian assistance”. This includes “medical services, food, shelter, and subsistence assistance, as well as supplies and reasonable administrative costs.” Programs would not be funded if they involved abortion, family-planning, transgender surgeries or other aid deemed not to be life-saving.
Even with this concession, aid groups say confusion abounds. “Does work on clean water count as life-saving aid?” asked an official in one large ngo. Some projects were being closed because of the uncertainty. The status of PEPFAR is unclear.
Waivers apparently still need to be issued case-by-case. Whether the government has the staff to process them quickly is another question. Few of the state department’s political appointees have yet arrived. USAID, the main American development agency, has furloughed hundreds of senior staff and contractors. One spoke of a “sad and apocalyptic” atmosphere.
The state department says the full halt was necessary because “it is impossible to evaluate programs on autopilot”, arguing that those running them have little incentive to give details if the money keeps flowing. It claims to have already saved about $1bn, halting things such as the delivery of condoms to Gaza, sex education globally and clean-energy programmes for women in Fiji. The department offered no details to support its $1bn estimate.
Al-Hol offers just one example of how stopping work suddenly for such dubious reasons is an avoidable act of self-harm. “Without aid, it’s difficult to maintain the security of the camps,” says Ali Rahmoun, a spokesman for the Syrian Democratic Council, the political wing of the SDF. “The jihadists won’t just be a problem for Syria but for the region and even Europe.”
Americans would be in danger, too. Shamsud-Din Jabbar, a 42-year-old US army veteran, rammed his Ford pickup into a crowd in New Orleans on New Year’s Day, killing 14. He was killed by police. In his vehicle they found IS’s black flag. ■
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The German economy shrank by 0.2% quarter-on-quarter in the three months ending in December, according to preliminary data released by Germany’s statistics office Destatis on Thursday.
The figure is adjusted for price, calendar and seasonal variations.
Analysts polled by Reuters had been expecting the gross domestic product (GDP) to decline by 0.1%.
Household and government consumption expenditures increased, but exports were “significantly lower” than in the previous quarter, Destatis said.
“After a year marked by economic and structural challenges, the German economy thus ended 2024 in negative territory,” it added.
Thursday’s figures compare to a 0.1% rise of the country’s GDP in the third quarter of last year. Germany’s economic performance has long been sluggish, with quarterly GDP readings mostly hovering around the flatline in the past two years. The economy has however managed to avoid a technical recession.
On an annual basis, the German economy contracted in both 2023 and 2024, by 0.3% and 0.2% respectively.
Some respite is expected in 2025, with the German government on Wednesday revealing its forecast of 0.3% growth for the year — still a notably downward revision from it’s previous estimate of 1.1% growth.
“The diagnosis is serious,” Robert Habeck, economy and climate minister, said during a press conference Wednesday, according to a CNBC translation.
He added that the German economy has been stagnating for a long time. He pointed to both internal and global political uncertainty as factors leading to the cut to expectations, and added that the outgoing government had been unable to fully implement its growth plans as its term was ending early.
A federal election in Germany is slated for Feb. 23, which is earlier than originally planned due to the break up of the country’s ruling coalition late last year.
Habeck also said that there were structural issues weighing on the German economy, echoing comment made by the Finance Minister Jörg Kukies last week.
“The structural weaknesses of our economy absolutely have to be addressed,” Kukies told CNBC. “It’s really important that we embark on a path of economic growth.”
This is a breaking news story, please check back for updates.