The World and Everything in It: January 9, 2023

MARY REICHARD, HOST: Good morning!

A property dispute at the Supreme Court asks what’s the right tool for legal interpretation?

NICK EICHER, HOST: That’s ahead on Legal Docket.

Also today the Monday Moneybeat, economist David Bahnsen answers listener questions.

And the WORLD History Book: 100 years ago France and Belgium insist that Germany pay war reparations.

REICHARD: It’s Monday, January 9th. This is The World and Everything in It from listener-supported WORLD Radio. I’m Mary Reichard.

EICHER: And I’m Nick Eicher. Good morning!

REICHARD: Now the news with Kent Covington.

KENT COVINGTON, NEWS ANCHOR: Biden’s first trip to border » President Biden is in Mexico City today, his first trip to Mexico as president, one day after his first visit to the U.S. southern border.

White House press secretary Karine Jean-Pierre explained the purpose of Biden’s stop in El Paso, Texas.

PIERRE: Assess border enforcement operations there first hand; meet with elected officials there as well and local officials.

But amid a record border traffic surge, Republican Texas Gov. Greg Abbott wasn’t impressed with Biden’s 3-hour visit or his border policies.

ABBOTT: It’s about two years too late and about $20 billion dollars short of what needs to be done.

Immigration will be a major topic of discussion today as Biden meets with top Mexican and Canadian officials in Mexico City.

Biden recently announced a border policy shift, with Mexico’s blessing. The United States will send thousands of migrants from four other countries back across the border each month.

House expected to get to work today (Monday) after finally electing speaker » And House Republicans have promised to make border security a top priority as they get to work this week.

The House is hoping to pass a rules package today after it took Republicans nearly all of last week—and 15 rounds of voting—to elect Kevin McCarthy as speaker.

It took plenty of wheeling and dealing for McCarthy to win over Republican holdouts.

Florida Congressman Byron Donalds said among the concessions McCarthy made …

DONALDS: We have firm commitments that any bill is going to be laid on the floor for 72 hours, so not just the members of Congress, but also the American people are able to read it.

The new GOP majority also plans to launch several investigations into the Biden administration, the Justice Department, and the U.S. military withdrawal from Afghanistan.

Fighting continued during Putin’s so-called ceasefire » In Ukraine, bullets and shells continued to fly over the weekend despite Vladimir Putin’s claim that Russian troops would observe a ceasefire around the orthodox Christmas holiday.

KONASHENKOV: [Russian]

Russian defense ministry spokesman Igor Konashenkov said Putin did in fact order a ceasefire and that Russian troops only acted in self-defense.

Ukraine never agreed to pause its fight against the invading army.

Officials in Kyiv and in Washington said they considered Putin’s proposal a ploy to allow his forces time to regroup from recent losses.

Iran » Iran announced the executions of two more men over the weekend in connection with anti-government protests.

NETANYAHU: [Hebrew]

Israeli Prime Minister Benjamin Netanyahu described the executions as despicable murders.

AUDIO: [Iran State TV anchor]

Iranian State TV reported government claims that the two men were executed for killing a security officer during protests in early November.

Human rights groups say the men did not receive a just trial.

Officially, Iran has executed at least four protesters. But activists say the government has sentenced more than a dozen people to death in closed-door hearings.

40 people killed, dozens injured in bus crash in Senegal » The African country of Senegal is observing three days of mourning after a bus crash that killed dozens. WORLD’s Josh Schumacher has more.

JOSH SCHUMACHER, REPORTER: A bus traveling down one of the country’s main roads suffered a tire blowout on Sunday causing it to veer into a head-on collision with another bus.

The crash killed at least 40 people and wounded 80.

In 2017, a similar incident occurred, resulting in 25 deaths.

Car crashes in West African country are not uncommon—poor road conditions, unsafe vehicles, and rule-breaking drivers often make driving unsafe.

For WORLD, I’m Josh Schumacher.

Pro-Bolsonaro rioters storm Brazil's top government offices » In Brazil, a week after the inauguration of President Luiz Inácio Lula da Silva supporters of the former president stormed Congress, the Supreme Court and presidential palace Sunday.

They claim the election was stolen from President Jair Bolsonaro. WORLD’s Emma Freire says some of those protesters committed significant acts of violence.

FREIRE: They broke windows and furniture, set carpets on fire, and stole artworks. In remarks after the protests, Lula blamed Bolsonaro directly for what happened.

Lula said the former president incited violence with social media posts.

Police arrested hundreds of protesters.

I’m Kent Covington. Straight ahead: a property dispute at the Supreme Court.

Plus, the Monday Moneybeat.

This is The World and Everything in It.

MARY REICHARD, HOST: It’s Monday morning, January 9th, 2023, and you’re listening to The World and Everything in It from WORLD Radio. Good morning! I’m Mary Reichard.

NICK EICHER, HOST: And I’m Nick Eicher. It’s time for Legal Docket.

Each year, the chief justice of the Supreme Court publishes an annual report on the state of the federal judiciary and so from that report, here are a few notes:

And, first, this one is notable, in that we often hear that the courts are overburdened.

The report points out that this past year, though, caseload year-on-year in the federal court system fell by 8 percent.

Chief Justice John Roberts also called attention to the safety and security of judges in 2022. Now, as an aside, we should note—because Roberts didn’t mention this, because maybe he didn’t have to—this was a tumultuous year for the court: the Dobbs opinion was leaked, an assassination attempt was made on Justice Brett Kavanaugh, other conservative justices were threatened and protesters came to their private homes.

Quoting from the report: “The law requires every judge to swear an oath to perform his or her work without fear or favor, but we must support judges by ensuring their safety. A judicial system cannot and should not live in fear.”

REICHARD: The Chief made note of the work of U.S. District Court Judge Esther Salas to help protect judges and their families. Her son Daniel Anderl was murdered when he answered the door at her home. The attack in July of 2020 was meant for her.

Now, just last month, Congress enacted the Daniel Anderl Judicial Security and Privacy Act. Here’s Judge Salas at a press conference after passage of that law, edited for time:

SALAS: These are dark times. But in the two years and five months, I saw members of Congress come together, I saw them come together, put their differences aside, and come together, because they knew it was the right thing to do. To protect judges and their families, to protect democracy, to protect the Constitution, they did the right thing. And in the world we live in it takes courage sometimes to do the right thing… But I'll tell you what I'm most proud of. And I know I speak for Mark when I say we are so very proud to be Daniel's parents. Thank you honey, we love you.

EICHER: Oh, that’s heartbreaking to hear, but important that we do hear it.

But let’s go ahead and jump into the two oral arguments we’ll cover today.

The first involves two neighbors, Larry Wilkins and Jane Stanton. They each own property near a national forest about 90 minutes south of Missoula, Montana. A road crosses the properties for which a previous owner had granted an easement to the federal government. The easement lets loggers and ranchers cross over their property to get into the forest and allow the neighbors to live the quiet lives they wanted.

And, to this point in the story, so far, so good...

REICHARD: ...until traffic and noise and theft arrived. That’s because somewhere along the way, the Forest Service opened the road up to the public. There’s dispute over some of the facts, but Wilkins and Stanton see that action as a violation of the terms of the easement.

So in 2018, the neighbors sued the government under a law called the Quiet Title Act.

But the government argues they filed too late. The law says you have twelve years “after the property owner knew or should have known of the claim of the United States.” Wilkins and Stanton want the chance to argue that it isn’t too late.

EICHER: The debate will be settled by how that 12 -year time limit to sue is classified. If it’s one kind of rule called claims processing, Wilkins and Stanton can offer a reason for being late and still proceed with their case. But if it’s another kind of rule called jurisdictional, they can’t.

Which one applies here depends upon what interpretive tool the court uses to decide. Listen to the Chief Justice explain:

ROBERTS: You say it's a question of statutory interpretation. Back in the bad old days where we had a statute to interpret, we looked at all sorts of stuff, you know, hearings, reports, testimony, all sorts of things, sometimes to the expense of the actual language, which these days we look at much more carefully.

REICHARD: By “much more carefully,” he means using textualism as the preferred interpretation tool. Used to be, justices would look at all sorts of things to figure out what the words on the page mean. Now, more conservative justices just stick to the text.

Much discussion revolved around whether older decisions ought to be revisited with the newer way of interpretation. Again, the Chief Justice:

ROBERTS: When we're adopting a new test, are we going back and saying we were wrong in deciding what Congress meant or -- or what?

Justice Elena Kagan questioned the lawyer for the government, Benjamin Snyder. The government here is seeking to stop litigation over the easement:

KAGAN: I mean, we don't need a new test. We have a test. We have many, many decisions that have clearly stated what we do in this situation, the situation being we've used the word "jurisdictional" in the past and what consequence does that have. And we’ve clearly stated, as you just said, that if we’ve really addressed the issues, decided the issue, then that controls. It has stare decisis effect. But if we’ve just kind of used the word without deciding the issue, then … that doesn’t have stare decisis effect…

SNYDER: Let me just sort of put on the table that even if you don't agree with me on that, we have a ratification argument that we think could lead you to the same result. But let me -- let me start with the question you're asking.

KAGAN: If you can't convince me of this first question, you're not going to convince me of the second question. (Laughter.)

I’ll end this argument with a comment by Chief Justice Roberts, referring to Congress:

ROBERTS: The people across the street are on clear notice that they’ve really got to spell it out if they want one of these time limits to be jurisdictional.

The Supreme Court’s held that most time-limitation laws are not jurisdictional—meaning the kind that can’t be waived. So I doubt the government will prevail here.

The final argument we’ll cover today is Mallory v Norfolk Southern Railway. Mallory is Robert Mallory who worked for the railway for nearly 20 years. He’s a resident of Virginia and worked either in that state or in Ohio. When Mallory developed cancer, he sued the Railway for negligence and reckless conduct. He alleges on the job exposure to toxic substances caused it.

But Mallory chose to sue in Pennsylvania, not Virginia or Ohio where he actually worked. It’s likely his lawyers did a little venue shopping; that is, looked for a state that might be more favorable to his case.

Here’s Mallory’s legal argument: The railway registered to do business in Pennsylvania. Now, the state requires a foreign corporation to register before doing any business there. And state law says that’s enough connection for Pennsylvania courts to have jurisdiction over this case.

But the railway says, hold on! That’s not consent to be sued; it’s more like duress. It’s an unfair scheme that the railway argues violates its Due Process rights under the 14th Amendment.

Justice Ketanji Brown Jackson had a pointed question for Carter Phillips, lawyer for the railway:

JACKSON: So why -- why isn't it happening in a situation in which you knowingly file the registration and it's clear from the law that when you file -- choose, when you choose to file the registration, you're thereby consenting?

PHILLIPS: Well, I mean, this Court -- I mean, that's not the normal way the Court thinks about consent or waiver of fundamental constitutional rights.

Mallory’s lawyer Ashley Keller agreed with Justice Kagan that there is a right not to be hauled into a state court if you aren’t sufficiently connected to the particular state.

Now, you’re going to hear Justice Kagan make reference to “unconstitutional conditions.” That’s important. Unconstitutional conditions prohibit the government from penalizing a company or person for exercising a constitutional right.

KAGAN: Okay. Well, then, I mean, once we have that, then it seems to me you are in unconstitutional conditions land, because here's the state saying, well, this right, we're going to demand that you give up this right to have access to our markets. So it's conditioning access to its markets on the waiver of the right, which you've just conceded not to be subject to general jurisdiction for doing business.

KELLER: Yes, that -- that is correct. I'm going to make a confession. I find this Court's unconstitutional conditions doctrine very difficult.

KAGAN: You and everybody else. (Laughter.)

Let’s hope some clarifying principle comes out of this one. Big consequences one way or another: whichever side wins, the other side may have to defend itself in far-off places. That’s not cheap. Given the tenor of the questions asked, though, I think the railway will win.

And that’s this week’s Legal Docket.

MARY REICHARD, HOST: Next up on The World and Everything in It: the Monday Moneybeat.

NICK EICHER, HOST: It’s time to talk business, markets, and the economy with financial analyst and adviser David Bahnsen. He’s head of the wealth management firm The Bahnsen Group and he’s here now.

David, good morning!

DAVID BAHNSEN, GUEST: Good morning, Nick, good to be with you.

EICHER: OK, it’s about time to get back to listener questions, as we’ve done a few weeks of reflection—a year in review 2022 and previewing the year ahead—but before we do listener questions, I’d like to touch base on economic conditions, market conditions, whether there was a single big story of the week.

BAHNSEN: I don't think there was a significant economic or market story, because there's a lot of just more of the same. You had a massive move up in markets and risk assets on Friday around the unemployment report, and the unemployment report was strong. And so what happened is markets originally, were doing this thing of, oh, the news is good. So that must be bad in the sense that the Fed is likely to think things are too good and want to keep tightening more. And indeed, there were 223,000 jobs created in December, and it was about 205 expected. And if you believe the current wisdom narrative, it's that we really need to see just a ton of people losing their jobs for there to be good news. And as you know, that's not my belief at all. But what happened is not only was that 223, a little deceiving because they revised downward the month prior numbers by I think about 28,000. But wages had grown year over year, much less than expected on the month, they thought it'd be point four, it was only point three year over year, it was 4.6. And back in March, the year over year was 5.6. So the year over year, wage growth has been disintegrating. And this is supposedly important to markets because they think the Fed is really concerned about higher wages, because higher wages leads to consumers having more money to spend, which puts upward pressure on inflation. I don't believe any of that economically, it's all remnants of what's called the Phillips Curve from the 1970s. And I think it's very bad economics. But that's sort of irrelevant, because they believe it. And then once the markets kind of unpack the details of the jobs report on Friday, they rallied significantly. So that's probably the biggest story and the first kind of abridged week of the year, the markets were closed Friday, excuse me Monday, for New Year's Day, and even Tuesday was kind of a very low volume, low activity day. So we're not going to run into now. But the next big thing will be earnings season, we'll see the final numbers from q4. It'll be the first quarter of the year, where earnings were probably down year over year from the year prior. And yet for the whole year earnings were up about 5%. So that is what you call not a recession.

EICHER: Alright, question one comes from a state senator in the state of North Carolina—Senator Warren Daniel—this is an email. He wants to know: “What is the likelihood of the Russia-China alliance successfully replacing the petrodollar with the yuan in 2023 [the Chinese currency], and if that happened, what do you foresee as the consequences for the U.S. dollar and the U.S. economy?”

David, what do you say?

BAHNSEN: Well, because he said in 2023, the likelihood is zero. It is zero. There is no chance that the petrodollar is replaced in this calendar year. But this is a subject that's near and dear to my heart, but it has nothing to do with it happening overnight. There's a variety of factors and it's not just Russia, China. This can't happen without Saudi Arabia, as well, being willing to sell a significant amount of oil to adversaries of the United States, denominated in a currency other than the dollar. And so some greater Russia-China Alliance provides a backdrop that enables more non-dollar denominated activity and increases their leverage over time. But the notion that this is something that could happen this year is not on the table at all.

EICHER: And our second question—we get a lot of these—listeners who want to know whether they should include gold in their investment mix. Many of the questions are very specific to the individual, but at least one listener asked simply whether you recommend gold as an investment. So go ahead and tackle that one.

BAHNSEN: That question about gold's viability as an investment is usually rooted in some premises that I believe have been disproven over time. And so if the premise was gold does really well when things go bad. And another premise is that sometimes things go really bad. But the problem, of course, is that in 1980 to 2023, you're talking now about a 43 year period of time, gold is down by 30 or 40% just to inflation. And yes, there's been periods of low inflation in that period, there's been periods of high inflation in that period, mostly periods of moderate inflation. But one cannot view gold as a hedge against inflation and in a 43 year time period have it underperform that badly against just its own very modest metric of simply keeping up with inflation. That's it. You don't even make any money. You're just talking about maintaining a 1980's standard of living and gold would have to be something in the range of 30 to 40% higher right now to have done that. So the question is why and I believe that there was just a long period of time where the nature of how central banks used gold, and what it represented in the global markets. But right now, the fact of the matter is that people have advocated for gold because they advocate for something more like sound money. And I advocate for something more sound money. I want people's purchasing power to be more maintained. And yet we know that gold has not done that. And so one can be against the idea of gold as a solution—as I am—without believing that there aren't really the problems. I do believe central banks have run amok. I do believe there are some unwise policies that have created unsound solutions. And I do favor a rules-based approach to central banking. I don't want our interest rate policy is to be just on the whim of people that don't really have to be accountable to what standard they're using to administer monetary policy. But gold as an investment simply has written checks it cannot cash. It doesn't have an internal rate of return. There's not an earnings stream, and there isn't a interest payment. And so the fact of the matter is that you rely on certain speculative elements. It's not a heavily used industrial metal. It's not really even a heavily used cosmetic metal anymore. But even that would be a very unstable medium of currency. So it just simply hasn't delivered. And it isn't like, oh, it had one or two bad years and now I'm dumping on it. I'm talking about my entire lifetime. And certainly my entire adult lifetime. Now it's had big spikes up, right? There's moments of time where it's been up hundreds of percent, and then times where it's dropped a lot. But I have this argument with gold bugs and times, where I point out that if I told you 10, 11, 12 years ago that every central bank on Earth was going to print trillions of dollars, there'll be this quantitative easing, there'll be 0% interest rates for years at a time, that in fact, there would be about $16 trillion of global money trading at a negative yield—that's gone away now, but that was the case just your a few years ago—how do you think gold would do? And most would have said it could go up 300, 400%. It's down. It's down from where it was at its highs of about 2012 or so. And so that's the reason is just, at some point, you have to take the empirical information and figure out what it's telling you. And that's what we've done.

EICHER: All right, if you have a question for David Bahnsen, please get in touch at feedback@worldandeverything.com. I can summarize your question if you put it in writing in email. But it’s so much better to hear you asking your question, and so if you have a smartphone, I’d ask that you make use of the voice memo app and make a recording of yourself asking your question and you can email the file here. Same address: feedback@worldandeverything.com.

David Bahnsen is founder, managing partner, and chief investment officer of The Bahnsen Group. His personal website is Bahnsen.com.

Thank you for your questions, we’ll do more in coming weeks now that we’re past the holidays. And David I look forward to talking again next week.

BAHNSEN: Thank you for having me.

NICK EICHER, HOST: Today is Monday, January 9th. Good morning! This is The World and Everything in It from listener-supported WORLD Radio. I’m Nick Eicher.

MARY REICHARD, HOST: And I’m Mary Reichard. Next up, the WORLD History Book. 50 years ago this week, the birth of reality TV—for good or for ill—but first, on this day in 1923, France and Belgium insist that Germany keep its word about reparations. Here’s Paul Butler.

NEWSREEL: At the historic Palace of Versailles in Paris, statesmen assembled to draw up the peace treaties.

PAUL BUTLER, REPORTER: At the conclusion of World War I, the Allies levied reparations against the defeated German empire as part of the Treaty of Versailles. The punitive financial compensation was intended in part to repay the Allies for a portion of their war costs…more than 260 billion gold marks—a steep price tag for the decimated economy.

NEWSREEL: To indemnify the allies in money and materials for all the damage caused, is also added in the treaty. The money indemnity alone amounting to $31 billion.

Within the first two years, Germany paid about 250 million gold marks…or a little less than 1 percent of the demanded reparations. Some of the payment was in materials…limiting German exports and further straining the country’s finances. It didn’t take long for Germany to fall behind.

So on this day in 1923, the commissioners of France and Belgium vote to occupy the western district of Ruhr—the former industrial center of the German war machine.

The next day, French forces begin to build up along their eastern border with Germany—crossing into its territory on January 11th…without military opposition. The occupation of the Ruhr had begun.

Within just a few days, the French military deploys 100,000 troops—easily controlling the major industrial towns in the area. The German government is livid and appeals to the US.

The United Kingdom strongly opposes the occupation. British Newspapers warn it could quickly devolve into another war. And US President Warren Harding’s administration refuses to formally reply to the German protest…

The French and Belgian occupation of the Ruhr worsens Germany’s economic crisis. German civilians frequently resist the occupation forces. Immense international pressure and Europe's own economic challenges eventually motivate France and Belgium to accept a new war reparations plan. The occupation ends in August 1925.

Germany made its last World War I reparations payment in 2010—92 years after the terms of the Treaty of Versailles.

Next, the premier of the first American reality show on television.

CLIP: As Barry said, I want to be a superstar but I really can’t work it. You know, I have all these clothes, but I don’t have the ideas behind them…

On January 11th, 1973 , PBS launches a 12-episode series titled: An American Family.

CLIP: One boy is the greatest con-artist you ever saw…

The show features a California husband, wife, and their five teenage children.

CLIP: I mean, what are your plans, I just want to know…

Filmmakers Alan and Susan Raymond lived with the family off and on over seven months—recording 300 hours of raw footage:

CLIP: So you have the three girls mom and the two daughters, they really don't like being filmed, they really don't, they just would love their preference would be to avoid it. And then you have all the men in the family or all the males who are really enjoying it. So it was a lot of different personalities that you had to deal with…

The producer hoped to tell the story of the 1970’s modern American family. During filming, the couple’s 21-year marriage ended. The father’s business fell apart. And the eldest son came out, the series became exhibit A for the debate over the breakdown of the traditional American family.

CLIP: I failed so far, and I’m going to fail again, and I’m going to keep on failing until I drift into the ground…melt right in because I can’t really do anything.

The 3-month series attracted 10 million viewers and was a financial boon for the young National Public Television service.

The cinéma vérité project raised questions that all reality television programs—and even feature programs like ours—continue to wrestle with…how does the presence of a camera, microphone, and crew change human behavior? And does editing make events more dramatic than they really are?

In a television interview with Dick Cavett afterwards, the kids expressed how they felt about the series—and how it made them look to television audiences—daughter Deliah Loud:

CAVETT: How do you feel but the way you came off the way you look in the series, anyone want to grab that?

LOUD: I felt that I was very aware of… I was pressed for something to say. When there was, when there was no action or anything, you’d just be sitting there talking with friends or something. And and viewing yourself you think, oh God say something intelligent. Just don't sit there. Because if you're just sitting there and they're filming you, there's nothing you can say except try and strike up and how was school today? Great.

CAVETT: So you said a lot of stuff just because you need to say so.

So called “reality television” is a popular genre due to lower production costs and large advertising budgets…but very few viewers actually believe it reflects true life.

Keeping Up With the Kardashians, Big Brother, and even Survivor all have their roots in An American Family—though the 50 year old groundbreaking series seems restrained in many ways compared to much of today’s reality TV programming.

That’s this week’s WORLD History Book. I’m Paul Butler.

NICK EICHER, HOST: Tomorrow: A new Congress. After more fits than starts, the House picked a House speaker. We’ll talk about what changes we can expect in the new congressional term.

That and more tomorrow.

I’m Nick Eicher.

MARY REICHARD, HOST: And I’m Mary Reichard.

The World and Everything in It comes to you from WORLD Radio.

WORLD’s mission is biblically objective journalism that informs, educates, and inspires.

The Bible records God as saying, “Let there be lights in the expanse of the heavens… to separate the day from the night. And let them be for signs and for seasons, and for days and years… and let them be lights in the expanse of the heavens to give light upon the earth.” And it was so. (Genesis 1:14-15 ESV)

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