(C) Daily Kos This story was originally published by Daily Kos and is unaltered. . . . . . . . . . . Foul balls do count in Trump case [1] ['This Content Is Not Subject To Review Daily Kos Staff Prior To Publication.'] Date: 2023-11-15 In the NY civil fraud trial Trump’s defense has been one of “no harm, no foul” — and that does have a certain facial logic. It can be hard to accept the letter of the law when a result simply feels wrong. A recent comment in a Salon article anticipating Trump’s motion for a mistrial reflected this, quoting Syracuse University law professor Gregory Germain: “There needs to be an innocent victim or potential innocent victims for the AG to take action,” Germain continued. “So there is some resonance to his arguments about being targeted for political reasons. But there is also no question that he grossly overvalued his properties. Whether that constitutes fraud (where there was no reasonable reliance and harm) is a legitimate legal question for appeal. But the courts will base their decisions on evidence and the law, and not on allegations and dissatisfaction with the results of the trial.” Now, it does seem that, following summary judgment, as the damages trial has proceeded, the AG’s team has introduced evidence that the “harm” in this case included banks giving more favorable rates to Trump; even if they were paid off, they lost money they could have otherwise made knowing the true extent of their risk. I think this misses the core harm, which is the introduction of improper risk. We are familiar with this in the realm of more familiar criminal violations: a burglar who is caught empty-handed is still a burglar; a speeding or drunk motorist who hasn’t yet run into someone else; someone with counterfeit bills who hasn’t tried to spend them. We can readily understand how these can be considered criminal because of the threat involved in as-yet harmless activities. On the other hand, many argue that the “free hand of the marketplace” is all that is needed to control the actions of capitalists. Without getting into endless argument over the merits or definition of capitalism, it should be clear that the process of inventing a better mousetrap is much different from the process of marketing things for multimillion profits. Two drug manufacturers invent new drugs and market them with faked safety studies. The first drug works out well is succeeds; the second turns out to be flawed and has tragic results. We readily accept the second manufacturer should be prosecuted — but shouldn’t the first be as well, for putting the public at risk, just like a drunk driver? Similarly, two companies make public offerings, based on false prospectuses. One is lucky and thrives, the other goes bankrupt. But both are guilty of violating securities laws. The point is that risk avoidance costs money. In economics terms, it is an externality. A polluter who saves money by failing to control toxic emissions maximizes profits by passing what should be its costs to the public at large. In the same way, a business that uses fraud to pass risks on to other individuals or the public at large maximizes profits at others’ expense. (As Trump’s multiple bankruptcies illustrate, the risks he takes often do result in harm to others, and losses to banks, for example, can also lead to bank failures that ultimately are paid for by the public.) Risk is costly — just look at your insurance bills. We can criticize insurance companies for the details of their operations, but ultimately what they do is calculate the total likely cost of individual accidents, failures, and catastrophes, and then spread that cost over all who are at risk (taking some profit along the way). When you drive a car, the insurance you pay is your share of the total risk of all who drive. When you drive drunk, the risk you present increases, even if you never crash, so your share of the total risk increases and your insurance bill goes up. At bottom this is what the Trump trial is about. There are many businessmen who defraud their lenders. Many fail, and the lenders lose money, sometimes passing those costs on to the public as well. Trump must pay his share of the undisclosed risks he posed, even if in the present case the lenders were repaid. He is a drunk driver who didn’t crash this time around. [END] --- [1] Url: https://www.dailykos.com/stories/2023/11/15/2206002/--Foul-balls-do-count-in-Trump-case?pm_campaign=front_page&pm_source=trending&pm_medium=web Published and (C) by Daily Kos Content appears here under this condition or license: Site content may be used for any purpose without permission unless otherwise specified. via Magical.Fish Gopher News Feeds: gopher://magical.fish/1/feeds/news/dailykos/