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The Supreme Court seems divided over Donald Trump’s immunity

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THE PETITIONER in Trump v United States was not present on April 25th when the Supreme Court considered whether he and other ex-presidents should enjoy immunity from criminal liability for their official actions while in office. Rather than being ensconced at One First Street among the Italian marble and red velvet, Donald Trump was seated in a less august courtroom in New York City—where he faces state charges for allegedly covering up hush-money payments to an adult-film star.

A win in Trump v United States would not help him in New York, as those alleged crimes took place on the eve of the 2016 election before he became president. Nor would success at the Supreme Court let him wriggle out of charges in Florida related to classified documents—that alleged mishandling happened after he left office. Yet a dose of immunity would spell the end of the most serious case against Mr Trump: federal charges brought by Jack Smith, the special counsel, that he conspired to overturn the results of the 2020 election.

Two lower courts rejected Mr Trump’s plea for blanket immunity. In February, a three-judge panel at the appeals court wrote that “wholly immunising” presidents who have left office would undercut “the primary constitutional duty of the judicial branch to do justice in criminal prosecutions”. But the nearly three-hour hearing at the Supreme Court—which for long stretches sounded more like a graduate-level seminar on presidential power than a judicial proceeding—made clear that the justices think the legal matter is less than clear.

John Sauer, Mr Trump’s lawyer, warned that a “looming threat” of prosecution after leaving office “will distort the president’s decision-making” and hamstring him while in office. Without blanket immunity, he suggested, Barack Obama could be charged today with murder for errant drone strikes and, down the road, President Joe Biden could be held criminally liable for letting immigrants overrun the border. That’s no way to run an executive branch, Mr Sauer insisted.

But Mr Sauer’s pat plea aroused scepticism across the bench. Chief Justice John Roberts asked whether a president who appoints an ambassador after accepting a bribe could be prosecuted after leaving office. Mr Sauer’s reply—that bribe-taking is outside the scope of official presidential conduct—did not satisfy the chief. “But appointing an ambassador is certainly within the official responsibilities of the president,” he said, demonstrating the difficulty of untangling the act’s two components. This led Justice Sonia Sotomayor to resuscitate a hypothetical scenario from the appeals-court hearing: what about using a Navy SEAL team to assassinate a political rival? When Mr Sauer said that a president could not be held liable for such an “official act”, Justice Sotomayor, with backing from Justice Ketanji Brown Jackson, said America’s founders never envisioned that ex-presidents would be immune from prosecution for criminal acts undertaken for “personal gain”. The constitution’s framers toyed with granting such a cloak to presidents, Justice Sotomayor said, and opted against it.

A pair of questions emerged as the justices’ main concerns. First, which of Mr Trump’s alleged actions count as official (and are thus potentially immunised) and which are private (and thus a legitimate basis for criminal prosecution)? Second, more broadly, which principles should judges use to discern the difference, and through what type of judicial process?

Mr Sauer conceded early on that many of Jack Smith’s allegations against Mr Trump fell in the “private” category. He admitted that spreading knowingly false claims of election fraud and conspiring with a private attorney to file false allegations are both private acts, and therefore prosecutable. By contrast, “meeting with the Department of Justice to deliberate about who’s going to be the acting attorney-general of the United States” is an official act, Mr Sauer said, and should not spur criminal liability.

Justice Elena Kagan also pressed Mr Sauer on how to draw these lines. She was aghast at his claim that Mr Trump was acting officially when he urged legislators in Arizona to hold a hearing on election fraud, and when he worked with Republican Party officials to organise fraudulent slates of presidential electors. And she coaxed Mr Sauer into a corner where he, uncomfortably, conceded that perhaps presidents could not be held liable for spurring coups or sharing nuclear secrets with foreign governments.

Neither these extraordinary admissions nor a meticulous presentation by Michael Dreeben, who argued against Mr Trump’s plea, deterred the conservative justices from standing up for a robust reading of presidential power. Justices Samuel Alito, Neil Gorsuch and Clarence Thomas all seemed to lean heavily in Mr Trump’s direction, even if not towards a grant of absolute immunity. And Justice Brett Kavanaugh advocated an idea—recently floated in conservative legal circles—that only criminal laws with “a clear statement…referencing the president” can limit a president’s conduct. But only two criminal laws fit that bill, Mr Dreeben said, and so, under Justice Kavanaugh’s reading, “the entire corpus of federal criminal law, including bribery offences, sedition, murder, would all be off limits.”

As Justice William Brennan used to say, with “five votes, you can do anything” at the Supreme Court. Four justices seem intent on giving Mr Trump enough of a win that his election-stealing case will be scuttled. (This would happen if delays—stemming from an instruction to the lower courts to sort out which of Mr Trump’s alleged acts count as private—push the trial’s start past the presidential election in November. If he wins, Mr Trump could end the litigation.) Four more, the quartet of women, seem keen to allow the trial to get started, one way or another. Justice Amy Coney Barrett raised the spectre of letting it begin “immediately” and was the only jurist to broach the elephant in the courtroom: Mr Smith’s “concern for speed”.

That makes Chief Justice Roberts, whose sceptical questions for Mr Dreeben balanced his worries about Mr Sauer’s position, the probable deciding vote. The nuances and divisions revealed in the hearing may make speedy resolution of the case difficult. The ruling could come in a matter of weeks—or might not arrive until the end of June.

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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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Economics

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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