In recent weeks President Donald Trump has been at the heart of one political bombshell after another related to his campaign’s ties to Russia, but his move to fire FBI Director James Comey ratcheted up pressure on the Trump administration. With the appointment of a special counsel to investigate the issue, the Trump presidency faces its biggest crisis yet.
- What is a special counsel?
- What happens if Donald Trump resigns?
- Who is Robert Mueller?
- Who is Rod Rosenstein?
- How does impeachment work, and could it happen to Donald Trump?
- What is a trial in the senate?
- What is the 25th Amendment, and could it be used against Trump?
- How many official investigations are now underway?
- What do Trump’s troubles mean for the stock market?
What is a special counsel?
Deputy attorney general Rod Rosenstein appointed Robert Mueller to serve as a special counsel for the United States Department of Justice this week, authorizing him to continue the investigation led by former FBI director James Comey into any ties between Russian government officials and individuals associated with the campaign of U.S. President Donald Trump. Calls for such a move intensified after the president, with support from Rosenstein, fired Comey. So what exactly is a special counsel?
The term is used somewhat interchangeably with “special prosecutor,” but the latter is outdated. In 1978, Congress passed the Ethics in Government Act in the wake of the Watergate scandal. Thereafter, a three-judge panel based at the U.S. Court of Appeals in the District of Columbia could appoint an independent prosecutor to investigate matters in which other bodies, such as the DOJ, have a conflict of interest. Probably the most famous (or infamous) such figure is Kenneth Starr, who was initially appointed to lead an inquiry into a real estate deal involving the Clintons, and ended up exposing former U.S. president Bill Clinton’s affair with Monica Lewinsky. Congress did not renew the law in 1999.
Current provisions allow the attorney general (or acting attorney general, in this case) to appoint a special counsel—the favoured terminology today—when there is a conflict of interest or other “extraordinary circumstances,” and when it’s in the public interest to do so. A special counsel is a lawyer from outside the government and has the power to issue subpoenas and bring criminal charges. Indeed, Rosenstein’s order on Mueller’s appointment specifically notes the special counsel “is authorized to prosecute federal crimes arising from the investigation.”
Mueller ultimately answers to Rosenstein (he cannot be fired by Trump) but will operate outside traditional chains of command at the DOJ. He’s not subject to day-to-day supervision, though Rosenstein can request an explanation for any decision or steps that he takes. The DOJ will supply Mueller with staff, and he can request specific individuals, including those from outside the department.
When the investigation wraps up, the findings won’t necessarily be made public. The special counsel prepares a confidential report explaining the decision whether or not to proceed with charges and presents it to the attorney general, who notifies Congress of the conclusion. The attorney general can decide to make the report public.
Some have argued that’s a shortcoming of appointing a special counsel to investigate any Trump-Russia ties. “[It] is entirely possible that there could have been improper or inappropriate contacts between the Trump campaign and Russian intelligence without U.S. law having been broken,” wrote attorney Peter Zeidenberg, who served as an assistant special counsel in the past. That means no indictments, no press conferences, and no public documents. If the special prosecutor were to find evidence of objectionable but otherwise legal behaviour, Zeidenberg wrote, “the public would remain entirely in the dark.” — Joe Castaldo
What happens if Donald Trump resigns?
Donald Trump turbulence continues as the President deals with the fallout of firing FBI director James Comey and the subsequent hiring by the U.S. Department of Justice of a special counsel to lead the investigation into alleged ties between Russia and Trump’s campaign
While some are talking about impeachment, Tony Schwartz, Trump’s ghostwriter for The Art of the Deal, thinks Trump is going to resign before that process ever unfolds
This is what would happen if Trump actually did resign
According to U.S. Code 3 Section 20, he would have to submit his resignation in writing to the U.S. Secretary of State, currently Rex Tillerson, who would have to initial it and acknowledge receipt. (Or, at least, that’s what Secretary of State Henry Kissinger did in 1974 when Richard Nixon resigned, the only time in U.S. history it has happened.
According to the 25th Amendment of the U.S. Constitution, upon Trump’s resignation, Vice-President Mike Pence would instantly become president, though he would only take the Oath of Office shortly after. He would also have a swearing-in ceremony
If Pence is also somehow compromised, deemed unfit for office, or resigns himself, the next in line to the presidency is the Speaker of the House of Representatives, Congressman Paul Ryan. After Ryan comes the president pro tempore of the Senate, a position that usually goes to the senior member of the majority party. Right now, that’s 83-year-old Utah Republican Sen. Orrin Hatch. — Prajakta Dhopade
Who is Robert Mueller?
On Wednesday, former Marine and FBI director Robert S. Mueller III was appointed the special counsel to oversee the investigation into Russia’s interference with the 2016 U.S. election.
Mueller will pick up the investigation where James Comey left it before being abruptly removed from his post as FBI director on May 9. The decision to appoint Mueller, made by deputy attorney general Rod Rosenstein, followed a week of increasingly bad optics around Trump’s decision to fire the man tasked with investigating his campaign’s ties to Russia. (“Do not ask me about how this looks,” one senior White House aid told a reporter last week, “we all know how this looks.”) Appointing a special counsel was largely seen as an attempt to restore the public’s trust in the Justice Department’s investigation.
White House Republicans and Democrats alike welcomed the appointment of Mueller, who is leaving a position with WilmerHale law firm to take on the role of special counsel. The 72-year old New-Yorker served as FBI director from 2001 to 2013, during which time he built a nearly unscathed reputation as being fiercely independent and honest. Senate Minority Leader Charles E. Schumer (D-N.Y.) praised the appointment in a statement saying: “Former Director Mueller is exactly the right kind of individual for this job. I now have significantly greater confidence that the investigation will follow the facts wherever they lead.” Peter J. Roskam of (R-Ill) called him “a man of the utmost integrity,” and Darrell Issa (R-Calif.) said Mueller was “somebody we all trust.”
The universal praise for Mueller means that whatever comes of the investigation will likely be deemed credible and true by both parties.
The appointment also comes as a relief to the FBI, which saw Comey’s firing as a bitter blow to the bureau. “The fact that the investigation is now going to be led by Mueller, who is so like Comey in so many ways and who also loves the bureau, is sweet justice,” one senior FBI official told Politico.
In his letter announcing the appointment, Rosenstein outlined Mueller’s authority in the Russia probe, including the power to investigate “any links and/or coordination between the Russian government and individuals associated with the campaign of President Donald Trump,” adding that if “necessary and appropriate, the Special Counsel is authorized to prosecute federal crimes arising from the investigation of these matters.”
Until now, the biggest challenge of Mueller’s career was arguably dealing with the aftermath of the 9/11 attacks, which rocked the U.S. just a week into his job as FBI director. The department was accused of not having done enough to prevent the attacks. And while the FBI was subject to a number of government investigations, the bureau ultimately came out intact.
Three years later, Mueller and Comey, then-deputy attorney general, would share the spotlight for the first time when they challenged President George Bush’s use of executive power. Both men threatened to resign if Bush continued his domestic wiretapping program that was deemed unlawful. Bush eventually conceded.
In a statement following Mueller’s appointment on Wednesday, Donald Trump doubled down on his message that the investigation will come up empty. “As I have stated many times, a thorough investigation will confirm what we already know: there was no collusion between my campaign and any foreign entity,” he said. “I look forward to this matter concluding quickly.”
Based on other investigations of this nature, and Mueller’s meticulous attention to detail, it’s unlikely the case will close quickly. In fact, it could drag out for years and potentially outlive Trump’s term as president. — Catherine McIntyre
Who is Rod Rosenstein?
Until a few weeks ago, Rod J. Rosenstein was a U.S. attorney who’d held the same post in Maryland under three presidents. Rosenstein, a public servant in the Department of Justice for more than 25 years, was a George W. Bush appointee who stayed on at Barack Obama’s request. Earlier this year, when Donald Trump asked for the resignations of all Obama-appointed U.S. attorneys, the president made an exception for Rosenstein and soon after nominated him as deputy attorney general. The confirmation process was, relatively speaking, a breeze, and the Senate confirmed him by a vote of 94-6. On April 26, he started his new gig.
Less than two weeks later, Rosenstein was on his way to being a household name. On May 9, he penned a memo that made the case for dismissing FBI director James Comey (though Trump later admitted he’d have fired Comey regardless of any recommendation). On May 17, Rosenstein appointed former FBI director Robert S. Mueller as special counsel to oversee the Bureau’s investigation into Russian interference in the U.S. election. Today, he’ll brief senators on the unfolding situation.
Suddenly, Rod Rosenstein is one of D.C.’s most influential players. But who is he?
Born in 1965 to a father who ran a small business in Philadelphia and a mother who was a bookkeeper and school board president, Rosenstein is married with two daughters. His sister, Dr. Nancy Messonnier, is the director of the National Center for Immunization and Respiratory Diseases at the Centers for Disease Control and Prevention.
At his confirmation hearing last month, Rosenstein explained to senators his basic set of values, which he said he learned growing up in a town northeast of Philadelphia. “In my small hometown of Lower Moreland, Pennsylvania, I learned straightforward values. Work hard. Play by the rules. Question assumptions, but treat everyone with respect. Read widely, write coherently and speak thoughtfully. Expect nothing, and be grateful for everything. Remain gracious in times of defeat, and humble in moments of victory. And try to leave things better than you found them.”
At the same hearing, Rosenstein also spoke exhaustively about public service. He attended the Wharton School of Business at the University of Pennsylvania and then Harvard, where he was an editor of the Harvard Law Review, where he says he expected to rise to a position at a high-paying firm. But an internship at the U.S. Attorney’s Office in Massachusetts changed all that. He deeply admired colleagues of “great intellect and integrity” who were “doing the right thing and keeping people safe.” That set off a career in the Department of Justice that includes an impressive list of assignments. Here’s the list on his bio at Maryland.gov:
• Law clerk to Chief Judge Douglas H. Ginsburg, U.S. Court of Appeals for District of Columbia Circuit, 1989-90
• Trial Attorney, Public Integrity Section, Criminal Division, 1990-93
• Counsel to Deputy Attorney General of U.S., 1993-94
• Special assistant to Assistant Attorney General, Criminal Division, 1994-95
• Associate Independent Counsel, Office of the Independent Counsel, 1995-97
• Assistant U.S. Attorney for the District of Maryland, 1997-2001
• Deputy Assistant Attorney General for Criminal Matters, 2001-02
• Principal Deputy Assistant Attorney General, Tax Division, U.S. Department of Justice, 2002-05
Clinton nemesis Ken Starr was responsible for Rosenberg’s stint in the Office of the Independent Counsel, where he contributed to the Whitewater investigation into the Clintons’ business dealings in Arkansas. He’s cultivated a reputation as a fair-minded attorney. Philip B. Heymann, a deputy attorney general during the Clinton years, vouched for that reputation in the Washington Post. “I would have trusted him with anything … If there was a case where I was worried there was a perception we were being unfair, I would trust him to do the right thing and to do the job.”
Rosenstein repeated that devotion to doing the right thing during his confirmation hearing.
“The oath of office is an obligation. It requires me to support and defend the Constitution of the United States; to bear true faith and allegiance to the Constitution; and to well and faithfully discharge the duties of my office. I have taken that oath several times, and I have administered it many times. I know it by heart. I understand what it means, and I intend to follow it.” — Nick Taylor-Vaisey
How does impeachment work, and could it happen to Donald Trump?
What would it take for president Donald Trump to be removed from office by the United States Congress? He would have to be impeached—but that’s only the first step in a chain of events that’s unlikely to be set off any time soon, according to one expert in constitutional law.
To remove a president, a majority of the House of Representatives must first vote “yes” on one or more of the articles of impeachment introduced before them. The process then moves to a Senate “trial” presided over by the Chief Justice of the Supreme Court, in which arguments are presented by the House (in favour) and the president’s defence team (presumably against) a finding of guilt. If two-thirds of the Senate vote to convict, then the President is removed from office and replaced by the next eligible person in the line of succession—in this case vice-president Mike Pence.
“Despite some of the terminology, it is mostly a political decision rather than a legal decision,” says Louis Michael Seidman, the Carmack Waterhouse Professor of Constitutional Law at Georgetown Law. The constitutional grounds for impeachment include treason, bribery, and “high crimes and misdemeanours.” That last category “refers to political offences and not necessarily violations of the criminal law” according to scholars who have studied it, Seidman says. So a president may be impeached for actions that would not lead to indictment and conviction under the regular legal system.
Perceived conflicts of interests with his business holdings and the firing of FBI director of James Comey are just some of the offences critics have cited as grounds to impeach Trump. It’s not necessary to show that the president violated a specific law or statute, Seidman notes. “There are range of constitutional and sub-constitutional norms that we expect our president to adhere to, and if those are seriously abused, I think that is sufficient grounds for impeachment.”
No president has ever been removed from office by Congress. Two have been impeached. It happened in 1868 to the never-elected Andrew Johnson—he took the Oval following the assassination of Abraham Lincoln—for replacing his Secretary of War in violation of a law passed by Congress specifically to prevent him from doing so. Bill Clinton was also impeached, in 1998, for lying about an affair with then-White House intern Monica Lewinsky. Both were acquitted by the Senate. The closest to impeachment a president has come apart from those two instances was Richard Nixon, who Seidman says likely would have been removed from office via this measure had he not resigned from office.
Siedman does not expect Trump’s name to be added to the list any time soon, because the president’s party controls the lower chamber of Congress. “It’s possible it could happen after 2018, if the House were to be taken over by the Democrats,” he says. “But we’re not anywhere near there yet in terms of the political circumstances that would support an impeachment.” — Murad Hemmadi
What is a trial in the senate?
In Trump’s world, the appointment of a special counsel to investigate his election campaign’s ties to Russia is all part of “the single greatest witch hunt in American history.” In the real world, it could lead to evidence of wrongdoing that in turn could raise the potential for Trump to face impeachment.
This is the single greatest witch hunt of a politician in American history!
— Donald J. Trump (@realDonaldTrump) May 18, 2017
Even if a President is impeached by the House of Representatives, the U.S. Constitution says “the Senate shall have the sole Power to try all Impeachments.” The Senate is the court and its members become both judge and jury. For example, when President Bill Clinton was impeached by the House in 1998 for perjury and obstruction of justice, he was later found not guilty in the Senate trial, and got to finish up his term as president.
In U.S. history, dating back to 1776, the Senate has undergone only 19 formal impeachment proceedings, with a record of eight convictions, seven acquittals, three dismissals and a lone resignation. The majority of the trials were of judges, but there have been trials for two sitting presidents, Clinton in 1999 and President Andrew Johnson in 1868. (Richard Nixon resigned before the Watergate scandal even got this far.)
It should also be noted that in a Senate trial, a simple majority isn’t enough to find someone guilty. Instead, a supermajority of two-thirds is required, a rule implemented to ensure that impeachments would likely require members of both political parties to be in agreement. (The Senate voted 35-19 to impeach President Johnson, one vote shy of removing him from office.)
And while the Vice President of the United States, under the constitution, serves as President of the Senate, when a trial in the senate involves the President of the United States, the Chief Justice presides instead of the Vice-President to avoid any perceived conflict of interest.
All of which is to say if Donald Trump ever does face a Senate trial for impeachment, Vice-President Mike Pence won’t get to preside—though he will stand the chance of becoming the 46th President of the United States. — Aaron Hutchins
What is the 25th Amendment, and could it be used against Trump?
The Constitution actually provides for two ways to remove a sitting president from office. The first, impeachment by the House of Representatives and conviction by the Senate, is a function of the legislative branch of government. The second involves the executive branch, the president’s own, and it’s enabled by the 25th Amendment.
Section 4 of the Amendment allows the vice-president and a majority of the cabinet to tell the Senate president pro tem (typically the longest-serving senator from the ruling party) and the Speaker of the House that the president is “unable to discharge the powers and duties of his office,” in which case the vice-president becomes the acting president. If the president then tells Congress he is in fact capable of doing his job, he would regain his office.
The vice-president and cabinet can press their case. If they do, Congress must assemble within 48 hours (if it is not already in session) “to decide the issue.” The two chambers may sit for 21 days to deliberate the matter, and if two-thirds of both the House and Senate vote that the president is indeed unable to carry out his duties, then the vice-president continues to be acting president.
The Amendment was ratified by the states in 1967. “When John Kennedy was assassinated, people began to think about what would have happened had he lived but had he been seriously brain damaged,” explains Louis Michael Seidman, the Carmack Waterhouse Professor of Constitutional Law at Georgetown Law. “And there was no way to remove somebody like that from office.”
The first modern incarnation of the problem occurred during the latter years of the Woodrow Wilson presidency. No. 28 had a stroke in 1919, but remained in office, and thereafter the First Lady managed access to him and reportedly undertook or delegated many of his duties.
Section 3 of the Amendment provides for the president to declare himself “unable to discharge the powers and duties of his office,” transferring them to the vice-president as acting president unless he signals otherwise. It has thrice been invoked by Oval Office holders when undergoing medical procedures that are performed under general anesthesia, rendering the patient unconscious.
Some critics of the current administration have suggested that Section 4 should be used against President Donald Trump. “Some people have suggested that Trump could be removed for mental disabilities,” Seidman notes. “Aside from anything else, that process has to be triggered by the Vice-President, and that’s not likely to happen anytime soon.”
Vice-president Mike Pence has recently established his own political action committee (PAC), a funding mechanism for candidates running for office. He’s the first VP to do so. But there’s been no indication so far that Pence plans to invoke the 25th Amendment to remove the president from office. — Murad Hemmadi
How many official investigations are now underway?
Fingers can hardly count the inquiries underway toward the Trump administration. At least eight government bodies are investigating the president and people surrounding him, as are media outlets worldwide, triggering Trump to declare himself the victim of a “witch hunt” and hauling the White House into a cauldron of mutual suspicion.
The CIA was reportedly first to find evidence about Russia’s involvement in the election of Trump; in late August, director John Brennan phoned eight of his senior staff, some on their summer vacations using private phone lines, to brief them on information about hacked Democratic emails. The CIA also continues to provide “raw intelligence” to congressional committees.
In Congress, the House Intelligence Committee has been suspected of bias in its investigation of Trump’s Russian connections. The original chair of the panel, Devin Nunes, was caught reporting his findings to Trump before telling the rest of the committee. After Tunes stepped down in April, the chair went to Republican Mike Conaway, who was seen wearing pro-Trump clothing during the election.
More insight has come from an investigation by the House Oversight Committee, a group within Congress that has reported that Michael Flynn may have broken the law by receiving $45,000 from a Russian state news outlet to attend a dinner in 2015. The Department of Defense, under the inspector general, also launched an investigation on April 4 into Flynn accepting illegal payments.
The tally of detectives extends to the U.S. Treasury Department, which is digging into the financial transactions of Trump’s campaign chairman Paul Manafort. The department was originally looking into Ukrainian stolen assets when it found that Manafort was wiring money through Cyprus, a common offshore haven for Russians to store their money.
And of course, the FBI has been investigating Russia’s involvement in the election of Trump since before the November election. After Trump fired FBI Director James Comey, deputy director Andrew McCabe told reporters in March that the investigation would continue. The firing has prompted the appointment of a special counsel, former FBI director Robert Mueller, to look into Russian interference in the 2016 election, including possible links to the Trump campaign.
Media outlets have done sleuthing of their own. Most recently, on May 18, Reuters reported that Trump’s campaign had at least 18 undisclosed calls, e-mails, and text message exchanges with Russian officials and others with Kremlin ties. One of the contacts was Viktor Medvedchuk, a Ukrainian oligarch; his daughter has Vladimir Putin as a godfather.
Trump has tried to deflect the suspicion back at the investigators. He complains that he is the subject of a “hoax” and a “witch hunt.” After the launch of the special counsel, he told reporters, “a thorough investigation will confirm what we already know—there was no collusion between my campaign and any foreign entity. I look forward to this matter concluding quickly.” — Meagan Campbell
What do Trump’s troubles mean for the stock market
Donald Trump likes to say he moves markets. The past week provided concrete proof of that claim: The Donald acted, and markets fell.
Since the election, markets have largely tuned out the negative headlines about Trump and his administration. Markets generally viewed the goings on in the White House as a distraction from Trump’s promise to implement his so-called pro-growth agenda, such as tax reform.
But the news that Trump allegedly made a personal appeal to then-FBI director James Comey to drop the bureau’s investigation into former national security adviser Michael Flynn, altered the landscape. That revelation shifted the market’s view that Trump’s agenda might not just be delayed, but completely derailed.
Given the market saw its biggest one-day decline in months before recovering somewhat, the question becomes how might markets respond if this political crisis deepens and Trump either resigns or gets impeached?
History unfortunately doesn’t offer much of a guide. Consider the time between when U.S. President Richard Nixon’s tapes were subpoenaed and his ultimate resignation. During that time the S&P 500 stock market index fell 10 per cent. While some of that decline no doubt reflected uncertainty around the Watergate investigation, global markets were already falling following the collapse of the Breton Woods agreement in 1977 and the end of fixed exchange rates.
U.S. President Clinton legal woes don’t help much either. In 1998, between the time when Clinton’s Secret Service agents received subpoenas and the House Judiciary Committee said it would consider a resolution to begin an impeachment inquiry, markets also fell 10 per cent. Yet little to any of that drop can be attributed to the U.S. president, as it was also the period that saw the Asian financial crisis.
Which is to say, while politics may have a short-term effect, markets typically are driven by other factors. “Generally the market holds presidents in contempt,” says Joe Martin, director of Canadian business history, at the Rotman School of Management. Despite all of the attention afforded to Trump, very little ever gets done at the political level in the U.S., which makes it easy for business to tune it out.
“It’s a big mistake to invest around politics,” says David Rosenberg, Gluskin Sheff + Associates chief economist and strategist. “Despite my advice not to invest around Trumponomics, people did it in any event and that is what is being unwound now.” Consider where the biggest losses occurred this week. The hardest hit stocks were concentrated in U.S. financials, employment services and tech companies—the Trump sectors. While the S&P 500 ended down 1.8 down on the day, these sectors fell between 4 per cent and 6 per cent.
Pay particular attention to companies paying the highest tax rates, have the highest retained earnings locked up abroad or companies that are tied to infrastructure spending. “Those are the Trump sectors, in so much as this presidency gets obliterated these are the sectors that could correct further,” says Rosenberg.
There’s a chance that recent drop, focused in a few key areas, might account for a large extent of the Trump effect. As much as Trump likes to claim the rally has been in response to his presidency, the rally has been driven by a few large cap growth stocks.
Regardless of what happens with Trump, investors have other reasons to be concerned about the U.S. market. The U.S. bull market and economic expansion are both in their ninth year and it’s starting to deteriorate. As Rosenberg points out, momentum has stalled, with the average stocks now off about 6 per cent from their 52-week highs, while earnings forecasts are being pared back. In a recent note Rosenberg pointed out that 2017 earnings have already been trimmed by 1.5 per cent, and may fall further if Trump can’t push through his pro-growth agenda.
Over the next 12 months Rosenberg sees the market favouring value over growth, defensive over cyclical stocks and active over passive investment styles. “Playing defense, and a focus on quality and liquidity is right now paramount,” he says, noting that aside from raising cash by reducing exposure to the U.S., Gluskin Sheff is focusing on quality companies that have established record of earnings that are visible and predicable.
Another thing to consider is that Trump may yet come through this unscathed. There’s no certainty that impeachment proceedings will happen. Ian Bremmer, who heads up the Eurasia Group, a political risk consultancy, points out that while you can’t say the chance of impeachment is 0 per cent, he’s not convinced that Trump has done enough to give that serious thought. “At this point I don’t see anything that smells to me that it is an impeachable offence,” he says.
As for investing around Trump, Rosenberg’s advice is to run against the crowd, taking profits as the market moves higher on a political rally, and buying if a politically-motivated correction returns value to the market. “If we are going to get gyrations based on politics, those are going to provide selling or buying opportunity along the way,” he says. — Mark Brown