Inmates in California's jails and prisons have stolen upwards of $1 billion in pandemic unemployment aid, four district attorneys and a federal prosecutor announced Tuesday.
The news: A multi-agency investigation found that 35,000 unemployment claims were filed in the name of California state prison inmates and that 20,000 have already been paid out, said Sacramento County District Attorney Anne Marie Schubert.
Schubert called the scale of the scheme "honestly staggering" and "one of the biggest fraud of taxpayer dollars in Calfornia history."
The investigation involved district attorneys from Sacramento, El Dorado, Kern and San Mateo counties as well as McGregor Scott, the U.S. Attorney for the Eastern District of California.
Context: Tuesday's announcement is only the latest twist in the fraud saga plaguing California's unemployment programs, a challenge facing states nationwide. For months, fraudsters have exploited programs designed to swiftly distribute federal pandemic aid to self-employed and contract workers through a self-certification process.
Federal officials warned state workforce agencies this fall that cybercriminals in the U.S. and abroad — using troves of personal information mined from massive data breaches — may have pocketed $8 billion in pandemic aid. Police from Beverly Hills testified in Sacramento that they launched an investigation after reports of out-of-state suspects attempting to buy luxury goods from Rodeo Drive shops using cash or multiple Employment Development Department debit cards.
And last month a rapper living in the Hollywood Hills with the stage name of Nuke Bizzle was arrested on federal fraud charges after posting a music video entitled "EDD" that appeared to boast about defrauding the department. He is accused of applying for more than $1.2 million in benefits using stolen identities.
California's unemployment system has recently adopted a more sophisticated identity verification system and has taken other measures, such as halting the automatic backdating of claims.
But lawmakers and other advocates for low-wage workers are also concerned that an emphasis on fraud prevention has needlessly added legitimate claimants — sometimes with small discrepancies in their applications — to the state's lengthy backlog of unpaid claims, which reached 1.6 million earlier this fall.
A "strike team" appointed by Gov. Gavin Newsom this year found that nearly all of the claimants flagged for further verification were legitimate, while fraudsters sailed through the automated system.
States will have final say on how to prioritize who gets the first doses of any coronavirus vaccines, HHS Secretary Alex Azar told reporters on Tuesday.
A CDC vaccine advisory committee is set to meet as soon as the FDA authorizes the first vaccine, to determine which groups should get early access to the shot. But governors will have "final say," Azar said, raising the possibility that Americans could face widely differing distribution plans depending on where they live.
He and other top government officials have said that about 40 million doses of the vaccine will likely be available next month. Pfizer and its German partner BioNTech have filed for emergency authorization from the FDA, and another developer — Moderna — has said it will soon follow suit.
Although public health experts broadly agree that groups at high risk, such as front-line health care workers and the elderly, should be prioritized in any vaccination campaign, there will not be enough doses initially to treat all members of those groups.
"We are not dependent on any delay for ACIP in terms of helping to advise states on prioritization" of vaccines, Azar said of the CDC panel, the Advisory Committee on Immunization Practices. "We hope our recommendations will carry weight with [states] but at the end of the day, they will make that decision."
The timing will be tight: ACIP has said that it will wait until a vaccine is authorized before laying out its priority list. But the federal government's vaccine accelerator, Operation Warp Speed, is planning to ship the first doses within 24 hours of FDA authorization.
Azar said the federal government will not wait for ACIP's recommendations before distributing the first shots.
The CDC panel weighs in: ACIP met on Monday and unveiled the principles that will guide its recommendations. The group says vaccine distribution should aim to address health inequities amid disproportionate Covid-19 cases, hospitalizations and deaths in Black, Latino and Native American populations, as well as long-held distrust of the medical establishment among those groups because of historical abuse and mistreatment.
How the feds will dole out doses: The Trump administration will divide shipments of the coronavirus vaccine to states in December and beyond based on the size of their adult populations, rather than how many Covid-19 cases they have, Azar said.
"We wanted to keep this simple," Azar said. "Once we pass through these initial tranches where we're in a much more of a scarcity situation, we'll eventually get to where we need to be per capita."
Operation Warp Speed officials stuck with the population rationale to avoid having one distribution formula initially and changing it later, he added.
Governors provided limited feedback on how the first doses should be divided up by state, Azar said, noting that they "also wanted to keep it simple."
President Donald Trump has kept an unusually low profile since his election defeat, making few public appearances and hardly speaking except for on Twitter.
But when the Dow Jones Industrial Average crossed 30,000 for the first time on Tuesday, Trump emerged to take a victory lap.
“That is a sacred number,” said Trump, who has long fixated on the stock market as the barometer of his administration’s economic performance. “Nobody thought they'd ever see it.”
The appearance lasted just over a minute, and reporters were given hardly any notice, showing the hastiness of the remarks.
The index had hovered near that mark earlier this month amid news that vaccines for coronavirus demonstrated effectiveness and could soon receive emergency authorization. The market crested Tuesday after the GSA administrator the night before cleared the way for President-elect Joe Biden to begin coordinating with the government he will take over in January.
"I'm very thrilled with what has happened on the vaccine front,” Trump said, with Vice President Mike Pence by his side. “That’s been absolutely incredible.”
The appearance was not on the president’s schedule until moments before he showed up, and Trump took no questions from the press before exiting the room.
Trump is scheduled to hold the annual turkey pardoning ceremony later in the afternoon, a typically light-hearted event the president has seemingly reveled in over his prior three years in office.
Provided President-elect Joe Biden’s Electoral College margin of victory holds — and we have seen no reason so far to believe it will not — it will be the same margin won by Donald Trump in 2016.
That would leave Biden (as it did Trump) in the bottom third when ranking presidents by the percentage of Electoral College votes.
Back in 2016, Trump wrongly called his victory a “landslide.” Now, some are taking a page out of Trump’s book to claim Biden won in a landslide. But it wasn’t accurate for Trump then, and it’s not accurate for Biden now.
Richmond, Nov. 22: This was a fair election. Joe Biden won by over 6 million votes in the popular vote. 306 electoral votes, which is the exact same number that Donald Trump had that he called a landslide. So, Joe Biden won with a mandate and a landslide and now it’s time to transition.
The problem, of course, is that Trump’s 2016 electoral margin of victory — while convincing — was not a landslide by historical standards, as we wrote on Nov. 29, 2016.
The same is true of Biden’s Electoral College margin of victory. According to the media’s projected winner of every state, Biden captured 306 electoral votes, compared to 232 for Trump. That’s the same margin won by Trump in 2016 (though he ultimately lost a couple faithless electors). And as we said back in 2016, that only put Trump in 46th place out of 58 U.S. presidential elections.
“That total was not a landslide then, and it still isn’t,” John Pitney, a professor of American Politics at Claremont McKenna College, told us via email. “It is a clear, significant, legitimate victory, but is toward the lower end for electoral vote shares of winning candidates.”
Democrats still have plenty to be happy about, Pitney said, noting that:
- Biden’s raw popular vote total was the largest in history.
- Biden’s popular-vote percentage was the highest for a challenger since Franklin Delano Roosevelt in 1932.
- Biden won a larger percentage of the popular vote than Trump in 2016, Bush in 2004 or 2000, Clinton in 1996 or 1992, Reagan in 1980, Carter in 1976, Nixon in 1968, Kennedy in 1960 or Truman in 1948.
- Biden was the first challenger to defeat an incumbent since Bill Clinton beat George H.W. Bush in 1992.
- And when the count is final, Biden’s percentage will probably be a little higher than Obama’s in 2012 and Trump’s will be a little lower than Romney’s.
When we wrote about the historical margin of Trump’s victory back in 2016, all of the state results had been certified, and at this point less than half of the states have certified their election results. And as we did in 2016, we again add the disclaimer that these calculations assume Electoral College electors will vote according to who won a plurality of votes in their state, and that recounts will not overturn any of the state results. (Oddly, the Republican National Committee on Nov. 19 tweeted a video of attorney Sidney Powell making the baseless claim that, “President Trump won by a landslide,” and promising to “prove it.” The Trump campaign since has said that Powell is not a member of the Trump legal team.)
But provided the numbers hold up, as we said, it would be a relatively close win for Biden by historical comparison of Electoral College margins of victory.
According to current vote tallies, Biden leads Trump in the popular vote count by just over 6 million votes. By comparison, Trump lost the popular vote in 2016 to Hillary Clinton by nearly 2.9 million votes, making Trump one of five U.S. presidents to have lost the popular vote.
FiveThirtyEight’s Nate Silver notes that Biden’s current 4 percentage point lead in the popular vote — which Silver projects could grow to about 5 percentage points once all the votes are counted — is already a wider margin than Barack Obama’s 2012 win against Mitt Romney, though not as large as Obama’s 2008 win over John McCain, making Biden’s the second-largest popular vote margin since 2000.
“For the popular vote, an old rule of thumb is that a ‘landslide’ is 55 percent or greater,” Pitney told us. “Biden will get 51 percent, maybe a little more, but no ‘landslide’ by customary standards.”
Biden has avoided calling his victory a landslide, or anything like that, though he did claim via Twitter on Nov. 6 that the record number of votes for him in an American election gave him a “mandate for action.”
What is becoming clearer each hour is that record numbers of Americans — from all races, faiths, regions — chose change over more of the same.
They have given us a mandate for action on COVID and the economy and climate change and systemic racism.
— Joe Biden (@JoeBiden) November 7, 2020
It’s not unusual for presidents to claim an electoral “mandate,” even when the margin of victory is razor thin.
Two days after George W. Bush won reelection in 2004 with an Electoral College victory of 286 to 251, one of the closest in modern history, he told reporters that, “when you win, there is a feeling that the people have spoken and embraced your point of view.”
“I earned capital in the campaign, political capital, and now I intend to spend it,” Bush said.
But Trump embellished well beyond that in 2016, calling his win “a massive landslide victory.”
Biden campaign officials have been quick to pick up on that, as Biden-Harris Transition Senior Adviser Kate Bedingfield did in an interview on “Fox News Sunday” on Nov. 22.
“He won 306 Electoral College votes, which is … the same outcome from 2016 that Donald Trump called a landslide when he won 306 Electoral College votes,” Bedingfield said.
That’s true. It’s also true that neither Trump nor Biden won in a “landslide.”
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Key states continue to certify their election results Tuesday, blowing past attempts by President Donald Trump and allies to undermine or overturn the results of the 2020 election.
Pennsylvania Gov. Tom Wolf, a Democrat, announced Tuesday morning that the Pennsylvania Department of State had certified state election results and he had appointed Electoral College electors for President-elect Joe Biden. The moves finalized the results in a critical battleground that had been a target of Trump’s efforts to change or block results showing Biden winning.
In addition to launching a sprawling range of court cases in battleground states, Trump also invited Michigan state legislative leaders to the White House, as he pushed the prospect of GOP legislators in Biden states appointing their own pro-Trump electors. But that legally dubious plan has quickly faded as states including Georgia, Michigan and now Pennsylvania follow their election results and the normal processes laid out in their election laws.
“Today [the Pennsylvania Department of State] certified the results of the November 3 election in Pennsylvania for president and vice president of the United States,” Wolf wrote on Twitter. “As required by federal law, I’ve signed the Certificate of Ascertainment for the slate of electors for Joe Biden and Kamala Harris.”
Trump and allies tried to block Pennsylvania’s certification in both state and federal courts. But the president’s federal case was eviscerated by a district court judge over the weekend, and the campaign is currently trying to appeal to the Third Circuit. Meanwhile, a case brought in state court by plaintiffs including Rep. Mike Kelly (R-Pa.) and Republican congressional candidate Sean Parnell, who lost to Rep. Conor Lamb (D-Pa.), has argued that the state’s entire mail-in voting system was unconstitutional.
Three other battleground states are expected to certify results on Tuesday. In Nevada, the state Supreme Court will meet at noon Eastern Time on Tuesday to make the state’s results official, including Biden’s win there. The state board of elections in North Carolina, which Trump won, will lock in its results as well. And Minnesota, another state Biden carried, is expected to do the same later Tuesday afternoon.
The certification process, normally a formality, has been targeted by Republicans across the country as a chokepoint in the election process to block Biden.
The most intense attempt was in Michigan, where Biden won by roughly 155,000 votes, but that effort ultimately collapsed on Monday. Republicans urged the state canvassing board to delay certification, alleging widespread but unsubstantiated malfeasance in the predominantly Black city of Detroit. The Trump campaign abandoned its federal lawsuit in the state, falsely claiming they were doing so because the Wayne County board of canvassers, which includes Detroit, declined to certify the results. In actuality, the county board did certify results.
Three of the four members of Michigan’s state election board voted Monday to certify the results, despite pleas to wait from state Republicans, including the state GOP chair and a lawyer representing Republican Senate candidate John James.
Aaron Van Langevelde, a lawyer for the state legislature’s House GOP caucus and one of the two Republican members on the board, joined the two Democratic members in certifying the results. Van Langevelde argued that at the meeting that state law requires the board certify results, and it didn’t have the authority to demand an audit or otherwise delay the results.
Kash Patel, a White House loyalist who was installed at the Pentagon two weeks ago amid a purge of senior civilian officials, has been put in charge of the Defense Department's transition to the next administration, a Pentagon spokesperson confirmed on Tuesday.
The news, first reported by CNN, comes one day after the General Services Administration allowed the Trump administration to begin talking with the incoming Biden team to begin the transition process.
Background: Patel was named chief of staff to acting Defense Secretary Chris Miller just two weeks ago, the day after the president fired Defense Secretary Mark Esper. His former chief of staff, Jen Stewart, resigned shortly after. Trump allies were also installed in top positions overseeing intelligence and policy.
Stewart was leading the transition effort before she left the Pentagon, so it was expected that Patel would take over those responsibilities.
Patel previously worked for Rep. Devin Nunes (R.Calif.), the top Republican on the House Intelligence Committee, and as a staffer played a key role in helping Republicans discredit the Russia probe.
He also held a number of roles in the Trump administration, including on the National Security Council staff, in the office of former acting Director of National Intelligence Richard Grenell, and most recently as a top White House counterterrorism official.
Other personnel moves: Tom Muir, the director of Washington Headquarters Services, will be the agency transition director, the Defense Department transition task force lead and the senior career executive for transition, the spokesperson said.
On the Biden team: Kathleen Hicks, a senior vice president at the center for Strategic and International Studies, is leading a group of more than two dozen people handling the Defense Department transition for the Biden team.
Sen. Marco Rubio suggested on Tuesday that he would oppose confirmation of President-elect Joe Biden's national security team, presaging the first sign of potential Senate battles to come if Republicans maintain control of the Senate.
Rubio (R-Fla.) said Biden’s selections “will be polite & orderly caretakers of America’s decline,” criticizing their professional credentials and Washington bonafides. Rubio sits on both the Senate foreign relations and intelligence committees.
“Biden’s cabinet picks went to Ivy League schools, have strong resumes, attend all the right conferences & will be polite & orderly caretakers of America’s decline,” he tweeted. “I support American greatness. And I have no interest in returning to the ‘normal’ that left us dependent on China.”
In recent days Biden has announced plans to nominate Antony Blinken as secretary of State and Linda Thomas-Greenfield as U.S. ambassador to the United Nations — jobs whose occupants require Senate confirmation. The president-elect has also named Jake Sullivan as his national security adviser, a White House role on which the Senate has no say.
Blinken, Thomas-Greenfield and Sullivan join a handful of other high-profile nominees — former Secretary of State John Kerry among them — that have thus far been light on surprises and heavy on experienced hands and veterans of the Obama administration. Biden has not yet announced his pick for defense secretary, a centerpiece of the national security apparatus, despite widespread speculation that the job would go to Michèle Flournoy.
Rubio ran for president in 2016 and remains one of the GOP's highest profile lawmakers. The Florida senator, a child of Cuban immigrants, has been especially vocal on issues related to foreign policy, and his concern about the U.S. relationship with China dovetails with one of the Trump administration's international relations tentpoles.
Biden has vowed to counter China’s growing influence on the world stage while breaking from President Donald Trump’s unconventional approach to foreign affairs — especially with regards to the United States’ traditional allies, whom Trump at times has alienated and cajoled.
But the president-elect has to walk a fine line with his choices for administration posts that need Senate approval given the razor-thin margins in the chamber and the likelihood that nominees will need to garner Republican support to win confirmation. Some Republican senators have recently indicated a willingness to sign off on Biden’s cabinet selections — while warning they will sink nominees who they believe to be out of the political mainstream — potentially diffusing what would be an early standoff in Biden's presidency.
U.S. consumer confidence fell to a reading of 96.1 in November as rising coronavirus cases pushed American optimism down to the lowest level since August.
The November reading released Tuesday by the the Conference Board said represents a drop from a revised 101.4 in October. The decline reflected a big drop in consumer expectations for income, business and labor market conditions.
“Heading into 2021, consumers do not foresee the economy nor the labor market gaining strength. In addition, the resurgence of Covid-19 is further increasing uncertainty and exacerbating concerns about the outlook,” said Lynn Franco, senior director of Economic Indicators for the Conference Board.
Consumer confidence is closely watched for signals it can provide of how willing households are to spend. Consumer spending accounts for 70 percent of economic activity in the U.S.
“We think the sharp rise in positive coronavirus cases nationwide, which has prompted new restrictions and shutdowns in many states, has led consumers to be more fearful of what lies ahead for them and their families as we head into the year-end holiday season," said Chris Rupkey, chief financial economist at global financial group MUFG.
The consumer confidence index is set on a scale with 100 equaling the confidence level in 1985.
In the leadup to the pandemic with the country enjoying unemployment at a half-century low of 3.9 percent, the confidence index had risen above 130. It stood at 132.6 in February but plunged to 85.7 in April as millions of Americans lost their jobs after the country went into lockdown to try to halt the spread of the pandemic.
The index has bounced around since its big April decline but remains well below the levels seen before the pandemic hit.
For November, the present situations index, based on consumers' assessment of current business and labor market conditions, decreased slightly to 106.2 from 105.9. However, the expectations index, based on consumers' outlook for the future, declined from 98.1 in October to 89.5 in November.
Stocks are broadly higher on Wall Street in early trading Tuesday, extending a monthlong market rally driven by growing optimism that development of coronavirus vaccines and treatments will loosen the pandemic's stranglehold on the economy.
The S&P 500 index was up 0.9%, with traders favoring stocks that stand to gain the most from a gradual reopening of the economy, such as banks and industrial companies like Boeing. Overseas markets also rose. Treasury yields and oil prices were headed higher.
The Dow Jones Industrial Average rose 342 points, or 1.2%, to 29,934 as of 10:10 a.m. Eastern time. The Nasdaq composite was up 0.3%.
The gains follow news that the transition of power in the U.S. to President-elect Joe Biden will finally begin. On Monday, the head of the federal General Services Administration acknowledged that Biden is the apparent winner of this month’s presidential election. That allows the incoming president to coordinate with federal agencies on plans for taking over on Jan. 20, despite ongoing efforts by President Donald Trump to overturn the election.
Word that Biden has chosen former Federal Reserve Chair Janet Yellen as treasury secretary also added to investors' confidence. Widely admired in the financial world, Yellen would be the first woman to lead the department in a line stretching back to Alexander Hamilton in 1789, taking on a pivotal role to help shape policies at a perilous time.
Stocks have been pushing higher this month, driving the S&P 500 up by more than 10%, as investors have grown more hopeful that the development of coronavirus vaccines and treatments will help pave the way for the economy recover next year. The gains pushed the Dow Jones Industrial Average closer to passing the 30,000-point milestone.
The latest vaccine developments are also tempering lingering concerns over rising virus cases in the U.S., as well as in Asia and other parts of the world, and new government restrictions on businesses aimed at limiting the spread.
On Monday, drugmaker AstraZeneca reported surprisingly good results from ongoing vaccine studies. It said its potential vaccine, which is being developed with Oxford University, was up to 90% effective. Unlike rival candidates, AstraZeneca’s doesn’t have to be stored at ultra-cold temperatures, making it easier to distribute.
Last week, Pfizer and Moderna both reported study results showing their vaccines were almost 95% effective. And, over the weekend, Regeneron Pharmaceuticals received U.S. government approval for emergency use of its COVID-19 treatment. The drug, which Trump received when he was sickened last month, is meant to try to prevent hospitalization and worsening disease from developing in patients with mild-to-moderate symptoms.
Trading is expected to be light on Wall Street this week ahead of the Thanksgiving holiday on Thursday, when U.S. stock markets will be closed. They will reopen on Friday for a half-day session.
In European markets, France’s CAC 40 added 1.2%, while Germany’s DAX rose 1.1%. Britain’s FTSE 100 was up 1.3%. In Asia, Japan’s benchmark Nikkei 225 jumped 2.5%,. Australia’s S&P/ASX 200 gained 1.3% and South Korea’s Kospi added 0.6%. Hong Kong’s Hang Seng edged up 0.4%.