UNBIASED - Week in Review: March 18-23, 2023

Episode Date: March 24, 2023

1. President Biden Issues First Veto of Presidency (2:00)2. Federal Reserve Increases Interest Rates Despite Banking System Woes (12:59)3. TikTok CEO, Shou Chew, Testifies Before Congress About App Safety and Security (18:53)4. Tennessee HB878 Re: Solemnizing Marriage (26:28)All sources can be found here.Follow Jordan on Instagram and TikTok @jordanismylawyer. Learn more about your ad choices. Visit podcastchoices.com/adchoices

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Please gamble responsibly. Gambling problem? For free assistance, call the Connex Ontario helpline at 1-866-531-2600. BetMGM operates pursuant to an operating agreement with iGaming Ontario. You are listening to the Jordan is My Law podcast. This is your host Jordan and I give

you the legal analysis you've been waiting for. Here's the deal. I don't care about your political views, but I do ask that you listen to the facts, have an open mind and think for yourselves. Deal? Oh, and one last thing. I'm not actually a lawyer. Welcome back to the Jordan is my lawyer podcast. Happy Friday. I hope you guys are having a great week. It is time for our week in review unbiased as always, your favorite source of news. I have four stories for you today. The first story is that President Biden vetoed his first bill this week. The second story is that the Federal Reserve increased interest rates despite some banking system woes.

The third story is that the TikTok CEO testified in front of Congress, basically pleading for the United States to not ban the app. And the final story is actually a listener question. So one of you guys submitted a question to me on my website about a bill in Tennessee regarding officiating marriages. And we'll get into the question in a little bit, but I do want to say, if you guys ever want to submit a question for me, for me to potentially answer on air, you can definitely do that. Just go to my website, jordanismylawyer.com, go to the contact submission form, and you can, you know, let me know what your question is and, and perhaps I will cover it on

air. So without further ado, ah, wait, wait, wait, wait. I almost forgot my weekly reminder. Please leave me a review on whichever platform you listen, Spotify, Apple podcastss, Google Podcasts, whatever it is, I appreciate it. So now, without further ado, let's get into today's stories. President Biden vetoed his first bill on Monday, which is a little surprising considering he's already more than halfway through his presidency and this is only his first veto. So what this particular veto did was it sent back a resolution which would have reversed a Biden administration rule specifically for pension managers that allows pension managers to make investment decisions taking into account ESG

factors. ESG factors, for those who aren't familiar, are environmental, social, and corporate governance factors. When companies adopt ESG principles, it means that they're taking measures to lower pollution, CO2 input, reduce waste, et cetera. So basically really looking out for the environment. Also, you know, those social and corporate governance factors as well. But what this rule allowed, what this Biden administration rule allowed was that pension managers, when choosing, you know, what to invest in, it allowed them to take into account ESG factors. And ESG factors are relatively new. Democrats and Republicans don't necessarily see

eye to eye on this issue. Before we get into what this resolution would have specifically blocked and kind of talk about, because this Biden administration rule that Congress is trying to reverse here, it actually replaced and or clarified a Trump administration rule. So we're going to talk about the difference between the two. Before we get into that, let's talk about what a veto is. The term veto actually isn't in the Constitution. A lot of people don't know that. But what the Constitution does require is that every bill, order, resolution, any act of legislation approved by Congress has to also be approved by the president. That is in the constitution. Now, once this bill or resolution or whatever it is, is given to the president for

approval based on the constitution, that has to happen. A few things can happen at that point. The president, first and foremost, he has 10 days to sign the bill into law. This applies to every day except for Sunday. At that point at which he signs it, that bill becomes a law. He can also veto it by sending it back to Congress with a statement of objections within 10 days, again, except for Sundays. So him vetoing is basically saying, no, I'm not going to sign this. I'm going to send it back to you and provide you with a statement of objections and or, you know, reasons why I don't, I'm not signing this. If this happens, Congress has the opportunity to reconsider it with the president's objections, of course. And if it's able to pass both houses

of Congress by two thirds majority, that bill will become a law. So this is our checks and balances system in operation. So even if the president says no, Congress can still pass it. It just has to get more votes this time around. It doesn't matter even if the president says no, Congress can still pass it. It just has to get more votes this time around. It doesn't matter necessarily that the president vetoed it if it can get two thirds majority of Congress's vote. Now, if the bill goes to the president and he doesn't do anything with it, meaning he doesn't sign it, he doesn't veto it. The bill becomes a law automatically after 10 days, assuming Congress doesn't adjourn within this time. If Congress were to adjourn before that 10th day, the bill would just expire. This is called a pocket veto, and that's different than an actual veto. Pocket

vetoes can't be overridden. So if Congress still wanted to enact that piece of legislation, a new bill would have to be introduced and go through the whole process again. But in this case, in the case that we're talking about today, Biden actually vetoed the bill and sent it back to Congress with his statement of objections. And I'm going to get into why he ultimately decided to veto it, but I want to go over a few veto stats because I found this pretty interesting. Between 1963 and 2001, which was Lyndon B. Johnson's presidency through Bill Clinton's presidency, the average number of vetoes per president was 47 vetoes. Now, keep in mind,

we're halfway through President Biden's presidency, and this is his first veto. In recent years, though, that average number has dropped significantly. So George W. Bush and Barack Obama both only had 12 vetoes their entire presidency. Trump had 10. And again, Biden only has one so far. Keep in mind, naturally, you're going to see more vetoes when Congress's political landscape doesn't necessarily fall in line with the presidential party, right? Because Congress is passing bills that the president doesn't necessarily agree with, and that's when you're going to get more vetoes. Now, the president who issued the most vetoes ever was Franklin D. Roosevelt, and he issued 635 vetoes. That is a lot. So now that we know a little bit of context, a little bit of statistics, let's talk about what the bill was,

why it was vetoed. So on December 1st, 2022, there was this rule issued by the Biden administration called Prudence to Loyalty in Selecting Planned Investments and Exercising Shareholder Rights. In part, what this rule said was that pension plan fiduciaries may consider climate change and other environmental, social, and governance factors when they make investment decisions and when they exercise shareholder rights when those factors are relevant to the risk and return analysis. What this rule did was basically change around some of the language in the original 2020 rule, which was promulgated under Trump's administration,

but under both Trump's 2020 rule and Biden's 2022 rule, a fiduciary may consider only financial risk and return considerations and nothing else. In accordance with prudent investor principles, the fiduciary has to assess diversification and liquidity needs, has to be cost sensitive, and has to consider a reasonable number of alternative investments. These are things that a fiduciary has to do. Now with ESG investing, I said it's relatively new. There is an argument that ESG investing could satisfy those investor principles and actually have a positive impact. That obviously depends on the facts and circumstances of the investment. Just to give you an example, in 2022, ESG funds were actually hit

because of things like the war in Ukraine, crumbling financial markets, things like that. And as a result, those funds lagged non-ESG funds for the first time in five years. So as you can see, it's all circumstantial. But keep in mind that Biden's rule didn't mandate or require that a fiduciary make investment decisions solely based on ESG factors. What it did require, though, is that a retirement plan fiduciary has to engage in a risk and return analysis of their investment decisions and recognize that these ESG factors can be relevant to that analysis. Now, according to the White House, they say that if the Department of Labor were to revert back to the 2020 rule, which was promulgated under Trump's administration, they say the federal government would be

interfering with the market in a manner that stands in the way of retirement plan fiduciaries' ability to protect retirement savings and pensions and unnecessarily limits the options available to retirement plan participants and investors. So essentially, what the Republican-backed bill was trying to do is exactly what the White House is trying to avoid. The Republican-backed bill was trying to revert back to the original 2020 rule,

which is exactly why President Biden said no and vetoed this bill. The Republicans are against Biden's rule because they think that it politicizes investing. It allows plan managers to pursue liberal causes, which they say could hurt financial performance. So that's, they're not happy. Republicans are not happy that Biden's rule encourages, you know, looking into these ESG factors, whereas the 2020 Trump rule didn't necessarily encourage that. So again, President Biden vetoes this bill, and in his message to the House of Representatives, this is what he said. He says, quote, I am returning herewith without my approval, H.J. Resolution 30, a resolution that would disapprove of the Department of Labor's final rule titled Prudence and Loyalty in Selecting Planned Investments and Exercising Shareholder Rights.

The Department of Labor's final rule protects the hard-earned life savings and pensions of tens of millions of workers and retirees across the country. It allows retirement plan fiduciaries to make fully informed investment decisions by considering all relevant factors that might impact a prospective investment, while ensuring that investment decisions by considering all relevant factors that might impact a prospective investment, while ensuring that investment decisions made by retirement plan fiduciaries maximize financial returns for retirees. There is extensive evidence showing that environmental, social, and governance factors can have a material impact on markets, industries, and businesses, but the Republican-led resolution would force

retirement managers to ignore these relevant risk factors, disregarding the principles of free markets, and jeopardizing the life savings of working families and retirees. In fact, this resolution would prevent retirement plan fiduciaries from taking into account factors such as the physical risks of climate change and poor corporate governance that could affect investment returns. Retirement plan fiduciaries should be able to consider any factor that maximizes financial returns for retirees across the country. That is not controversial. That is common sense. Therefore, I am vetoing this resolution, end quote. Okay, so given the fact that this bill didn't have crazy bipartisan support and it only

passed the Senate by a 50 to 46 vote, it's unlikely that we'll see this pass Congress with two thirds vote now that it's been vetoed, because obviously that's what's needed in order for it to become a law. But it will be interesting to see the amount of vetoes increase from here since we now have a split party system. Right. So that is President Biden's first veto. I'm sure we will see again, like I said, we'll see more come from here. But let's move on to the second story, which is that the Federal Reserve raised interest rates despite some banking woes. Despite the recent collapse of SVB and Signature Bank, the Fed raised interest rates

for the ninth time in a row on Wednesday. It was a unanimous vote, and they increased it to a range of 4.75% to 5%. Fed Chair Jerome Powell did say, though, that the central bank probably won't raise rates in future meetings because it doesn't want to disrupt a banking sector already on the edge from high interest rates. The bank meltdown also could slow the economy, negating the need for more hikes. He's obviously referring to the collapse of SVB and Signature Bank. Following the raise, the Federal Reserve issued the following statement. This is what they said. They said, quote, recent indicators point to modest growth in spending and production. Job gains have picked up in recent months and are running at a robust pace. The unemployment rate

has remained low. Inflation remains elevated. The U.S. banking system is sound and resilient. Recent developments are likely to result in tighter credit conditions for households and businesses and to weigh on economic activity, hiring, and inflation. The extent of these effects is uncertain. The committee remains highly attentive to inflation risks. The committee seeks to achieve maximum employment and inflation at the rate of 2% over the longer run. In support of these goals, the committee decided to raise the target range for the federal funds rate to 4.75% to 5%. The committee will closely monitor incoming information and assess the implications for monetary policy. The committee anticipates

that some additional policy firming may be appropriate in order to attain a stance of monetary policy that is sufficiently restrictive to return inflation to 2% over time. In determining the extent of future increases in the target range, the committee will take into account the cumulative tightening of monetary policy, the lags with which monetary policy affects economic activity and inflation, and economic and financial developments. In addition, the committee will continue reducing its holdings of treasury securities and agency debt and agency mortgage-backed securities as described in its previously announced plans. The committee is

strongly committed to returning inflation to its 2% objective, end quote. So some had asked the central bank to pause its rate hikes temporarily just to allow for the banking system to kind of get back on better footing, gain some stability. But Treasury Secretary Janet Yellen says that large withdrawals from regional banks had stabilized. Bank stocks rallied this week. There wasn't really much worry. She did also say, though, which is a bit contradictory, She did also say during a press conference on Wednesday that what we saw happen with SVB, that rapid bank run could happen more readily in the future. She called the rapid collapse a quote, new phenomenon and said that

quote, many depositors were tech firms that work with venture capitalists that also bank. It's essentially shouting fire in a movie theater. Now, in the world we live in, although this is a small community and a disproportionate share of SVB deposits, this kind of thing may more readily happen, end quote. Following the Federal Reserve's rate increase, markets first went up, but then they wavered when Jerome Powell made this announcement that it's unlikely the Fed will cut rates this year. This is because now the stock market is essentially in competition with CDs, bonds, things like that. When interest rates are high, people keep their money in these fixed income assets. When interest rates are low and the stock market has a higher potential return, that's when the stock market does well.

So because these rates are going up and the Fed says we're not cutting them this year, people are putting their money in things like CDs and bonds rather than the stock market. Keep in mind, company earnings drive actual stocks, whereas interest rates drive the stock market as a whole. And that's just an interesting tidbit.

My dad, he works in the stock market and he actually taught me that. So where does inflation currently sit? Annual inflation in February was 6%, which is obviously down from the 9.1% last June, a rate we hadn't seen since 1981. So while it looks like things might be improving, 6% is still well above the Fed's target inflation rate of 2%. Notably, the last time we saw inflation rates below 2% was February 2021. So it's coming down from 9%, but we're not near that 2% range where the Fed's trying to get to. Because of that, the Fed is continuing to fight inflation by raising interest rates and slowing down the economy. The trick here is finding the right balance. You don't want to

increase rates too fast, too quickly, or else we could fall into a recession. But because interest rates are rising, this means naturally unemployment will rise. Companies can't afford to pay their staff. So the Fed is actually predicting unemployment will rise to 4.5% by the end of the year, which is up from 3.6% last month. And that could mean that more than a million Americans are out of work by the end of this year. So then naturally, once you have unemployed Americans who don't have the money to spend, then eventually inflation comes down, hopefully. So the key takeaway here is that rates once again have risen and they are not likely to be cut this year. And that is according to the Fed. So with that, let's get into story number three. TikTok CEO Sho Chu testified in

front of Congress on Thursday. The hearing comes after lawmakers have already banned TikTok from the cell phones of lawmakers on both the federal and state levels. And after the Biden administration demanded that ByteDance, TikTok's Chinese parent company, either sell the app or face a ban here in the United States. So this hearing lasted about five hours. It was opened by Representative Kathy Rogers, the chair of the House Energy and Commerce Committee. She was very adamant that TikTok should be banned. Her mind was absolutely made up. There was nothing that show to could have said that would have changed her mind. And one of the things that she said when she started was, quote, TikTok surveils us all. And the Chinese Communist Party

is able to use this as a tool to manipulate America as a whole. We do not trust TikTok will ever embrace American values. Your platform should be banned. Shou-Chu was given five minutes to give his introduction speech, and this is essentially what he said. He said TikTok is taking measures to protect minors on the app because that's one of the United States' main concerns is the kids under 18 and what their data is being used for, things that they're being fed on the app, things like that. So he said, TikTok's taking measures to protect the minors on the app. One of the things it does is it forbids direct messaging

for any users under 16. He also said TikTok imposes a 60-minute time limit for those under 18 and also provides family planning tools where parents can moderate their children's content. Now, there's one issue with that. There's always a workaround, right? There's always a way to get around this stuff. So while TikTok, yeah,

may forbid direct messaging for any users under 16 and may impose a time limit for users under 18, people can always lie about their age. Kids can always lie when they sign up for these apps, and then none of those things apply. Shou Chu also addressed national security concerns. He debunked some misconceptions, and what he said is that ByteDance is not owned or controlled by the Chinese government. It's a private company. There are five board members, three of which are American. TikTok is not available in mainland China. TikTok's headquarters are in Singapore and LA. They have 7,000 US employees. And for the last two years,

TikTok has been working on something they call Project Texas, which the CEO says amounts to a firewall that seals off protected US user data from unauthorized foreign access. So American data is stored on American soil by an American company overseen by American personnel. Now, again, this is a project they've been working on for the last two years. And Chu says that as of today, United States TikTok data is stored at Oracle's headquarters in Texas and only verified personnel working for a separate company called TikTok US data security can control access to this data. He also said that TikTok has plans for TikTok US data security, that new company,

to report to an independent American board. He says there's still work to do and that there is still legacy data, meaning old data, sitting in servers in Virginia and Singapore, and that they're working on deleting all of that data, which they expect will be deleted by the end of the year. And he says once that is done, all protected US data will be under American control

and subject to American law. He says that TikTok will allow third-party companies like Oracle to review the TikTok algorithm code. So there is oversight as to what Americans see on their feed. And then he ended his little five minute introduction with some commitments. The first being making TikTok, sorry, making safety a top priority, especially for teenagers. The second commitment being that firewall protected US data. The third commitment being TikTok, he says, will remain a place for free expression and will not be manipulated by any government. And the fourth commitment he made was transparency. So after this intro, the spotlight was back on Representative Rogers, who again, just wasn't buying any of it. This went back and forth for five hours.

The energy was kind of the same the whole time. Mr. Chu kept saying that, you know, TikTok is committed to making their platform better. He has seen no evidence of China's interference, whereas the lawmakers were dead set on the fact that TikTok is controlled by the Chinese Communist Party and China does have access to American data. If you look at independent research, it actually does back Mr. Chu's assertions. In 2020, the Washington Post worked with a privacy researcher to look kind of under the hood of TikTok, if you will, and found that the app doesn't appear to collect any more data than your typical mainstream social network. So Facebook, Instagram, things like that. Then in 2021, a Taiwan-based researcher at the University of Toronto Citizen Lab reached similar conclusions. It seems pretty clear that lawmakers here in the United States have their minds made up.

So the question becomes, will TikTok be banned? And if so, how will a ban be enforced? A ban on TikTok is an unprecedented move. The size of TikTok is so huge. I mean, there's 150 million Americans that use TikTok. So banning an app of that size has never been done. And then you have the question of how would that be enforced? Well, it's never been done. No one really knows. It seems that the most logical way to ban TikTok would be to force Apple and Google to remove TikTok from their app stores. That seems like it would have the most impact.

There was a criminal law and computer security expert from Boston University who suggested some other potential routes. And he said that the U.S. could block access to TikTok's infrastructure and data, seize its domain names, or force internet service providers like Comcast and Verizon to filter TikTok data traffic. I did also find this NBC article that asks, how would a ban work? And this is what it says. It says, it's not clear how the U.S. would institute a ban. The White House's best chance to do that would likely come from a bill introduced by a bipartisan group of senators last week that has strong White House support. While the senators behind the bill

introduced it as a way to potentially ban TikTok, it isn't exactly clear how that would happen. It would give the Secretary of Commerce a broader power to ban foreign technology in cases where the US believed it posed a national security threat. How that authority would be wielded is still up for debate, however. A spokesperson for the Commerce Department declined to discuss details on how the agency is considering that power. The easiest mechanism for the government to enforce a ban would be to prohibit the app stores from making TikTok available to download. Okay, so that's kind of what I said before. And then it says the use of TikTok could also potentially be criminalized,

resulting in fines. This has been done in the past with other banned software that was flagged as a national security threat. So yeah, so in a nutshell, no one really is sure. There are definitely options, but how a ban would work isn't exactly clear.

So that takes us into our last story. And this story comes from one of you guys. So I had a listener write in to me. Her name is Ashley. And she wrote in asking, I'm wondering if you could touch on a bill that was passed in Tennessee that could interfere with same-sex marriage and interracial marriage. I'm seeing a lot about it, but really you're the only news source I trust. Thank you. So I believe the bill that Ashley is referring to is House Bill 878, Senate Bill 596. It was introduced in the Senate in January. It has since passed the House,

and this is what it says verbatim, quote, a person shall not be required to solemnize a marriage. If the person has an objection to solemnizing the marriage based on the person's conscious or religious beliefs. So to solemnize a marriage is to perform a ceremony, otherwise known as officiate. All this bill is saying is that a person cannot be required to marry two people if the person marrying those two people doesn't agree with the views or beliefs of the people getting married. You can't force someone to marry two people. That's what this is saying. Indirectly, can this affect same-sex couples? Yes. Indirectly, can this affect interracial marriage? Yes. But this also can indirectly affect anyone who shares their own

set of views and beliefs. So let's just, let's give a hypothetical. Taking same-sex marriage and interracial marriage out of it, let's run through this. If a Jewish couple, let's say, is getting married and they want their close friend who happens to be Catholic to marry them and officiate their wedding, what this law says is that that friend doesn't have to marry them. That friend can legally and rightfully say no based on the fact that he doesn't align with their religious beliefs. Now, I'm not here to say whether this bill was directed at same-sex marriage or interracial marriage, but to answer the question, yes, if this bill becomes a law,

it could potentially interfere with same-sex marriages and interracial marriages in the same way it could interfere with any marriage that anyone has an issue with. Keep in mind, though, that I don't think anyone, whether gay, straight, Jewish, Catholic, transgender, atheist, whatever, you name it, would ever want anyone officiating their marriage who doesn't agree with their beliefs or views anyway. Does that make sense? So it's, it doesn't really change much aside from the fact that it's just putting into writing, Hey, you can't require someone to marry two people. Also keep in mind too, that Tennessee law already says that religious leaders do not have to

officiate weddings that they object to. So, you know, that could raise the question, well, if that law is already in place, why do we need this new law? Obviously, then this new law is just to target other people. But then you have the flip side of that, where the tenancy law that's already in place says that religious leaders specifically do not have to officiate weddings they object to. That only applies to religious leaders. This new law is saying anyone, whether you're a religious leader or someone off the street, you don't have to marry someone if you don't agree with their views or religion or whatever. So that is Tennessee's House Bill 878. Again, if you have a question regarding any legislation on a federal level or

state level, feel free to write into me and I will do my best to answer it. I can't promise anything, but if I have the availability in one of my shows, I can definitely throw it in there. So just submit that on my website, Jordan is my lawyer.com. And it, you know, you can just submit a contact form also on my website. Don't forget. That's where I have the comment section for you guys to interact with each other. That's where I have the sources. So there's a lot to find on my website. Definitely check that out. That's the end of the episode. I hope you guys enjoyed it. Please don't forget to leave me a review and I will talk to you on Friday.