TPM Cafe: Opinion

This article is part of TPM Cafe, TPM’s home for opinion and news analysis.

There was no knight on a white horse yesterday. He delivered exactly what he promised he would. Bob Mueller’s long-awaited and highly anticipated testimony didn’t provide any information that he hadn’t already provided in his written report.

Both sides were hoping for more. And each was disappointed.

Democrats had hoped there might be a smoking gun; or at a minimum, some sensational new revelation that would revive and perhaps stoke the interest of an American public that seems ready to move on from the Mueller Report and potential impeachment proceedings.

Republicans had hoped that they could embarrass or discredit a man who had spent his career in service to this country — beginning as a young man fighting in wars that many of them dodged or avoided.

Mueller told us before it all started he wouldn’t go beyond the Report; I think it is fair to say now that his was the understatement of the year. He’s a prosecutor’s prosecutor, and this was a political fight — one he repeatedly refused to join. Many of us were hoping to see the Marine that Bob Mueller had once been. A soldier who was prepared to go toe-to-toe with the apologists for Donald Trump. We were hoping to see someone defending the report with gusto. But Bob Mueller wouldn’t even read from the report itself, instead requiring members of Congress to do so for him, so that there would be no sound bites that could be taken out of context or used in political ads. On almost all issues he either deferred to the written report or absorbed body blows from Republicans, responding that he “took their question.”

The basic information did come out. But it was information we all knew from the written report months ago. Some nuggets were highlighted:

  • the President’s “no obstruction, no collusion” line was obliterated;
  • Mueller made even more clear that didn’t make a finding about the President’s guilt because of the OLC opinion;
  • the President refused to be interviewed and was uncooperative;
  • the campaign welcomed Russian help;
  • lies by Trump officials hurt the investigation;
  • the elements of obstruction of justice have been satisfied.

The obvious question is, now what? If the hearing this week is prologue, I’m afraid I have some bad news: Trump is going to get away with it.

House Democrats had weeks to organize this hearing and figure out a way to tell the arc of this basic story. It’s the kind of story prosecutors tell every day, and it would go something like this: in the first chapter, the Russians attacked our democracy. Next comes the recruitment of Trump loyalists. Then the repeated contacts with the campaign and family. And finally, the Cover-Up, the lies and the outright obstruction of justice.

But that’s not the story they told. Instead, the first hearing addressed obstruction, and the second one was about the cyber crime and collusion.

Anyone who’s ever spent time in a courtroom knows you can’t tell a story by starting with its ending. You don’t open your case with the cover-up of a crime — you have to start with the crime itself.

House Democrats have spent the last two years waiting for someone else to solve the Trump conundrum. Flynn is going to flip! Stone knows everything and he will flip! Corsi knows a lot more than he is saying … the pressure on him is immense to flip! Papadopolous’ mother is pressuring him to come clean! Manafort is coming, Manafort is coming! Pay attention to Gates! Assange has no choice! Mueller will indict the President (even though it was always clear the DOJ memo did not allow it). And now, if they could just get Don McGahn…

What became clear Wednesday is that there is no savior here, no knight in shining armor is going to ride in and save the day. It is now up to them, and to them alone, to determine whether they follow the polls or whether they follow the evidence. House Democrats are uniquely given the power to remove a President. No one else can do this job for them. And if Wednesday’s hearings proved anything, no witness, not even a living legend like Bob Mueller, can make the political difficulties of the case go away.

The legal case is obvious: the President welcomed Russian assistance in the 2016 election. Neither he nor anyone in his campaign told the FBI or any law enforcement authority about the Russian offers to assist his campaign. He then obstructed the investigation and lied to cover it all up.

The facts and witnesses are well known at this point. If President Trump were anyone else, he would be indicted, as over 1,000 former prosecutors stated in a recent letter. But today, this is no longer a legal case, it is a political one.

Speaker Pelosi must make the decision about whether or not she wants to spend political capital to begin an impeachment proceeding, knowing it will ultimately fail in the Senate. And eventually, the full House may have to decide whether to impeach or not. Nothing that happened on Wednesday is going to change that, and no witness, no matter who, is going to ride in on a white horse and save them from the most difficult political decision that any of them will ever have to make.

Bob Mueller did what he said he would do. Now it’s up to Nancy Pelosi to decide what to do next.

 


Cynthia Alksne is a career federal prosecutor, MSNBC Legal Analyst, and expert on criminal law, grand jury and police investigations and confrontational interviewing techniques. She has tried more than fifty cases to verdict and analyzed thousands more — as a prosecutor in the Civil Rights Division of the United States Department of Justice, as an Assistant US Attorney in the United States Attorney’s Office in Washington where she worked for former Attorney General Eric Holder and alongside former FBI Director Robert Mueller, as Assistant District Attorney in the Brooklyn, NY District Attorney’s Office, and as Assistant Attorney General for the State of Texas. She has investigated and secured or negotiated guilty pleas and/or plea agreements in hundreds of criminal cases.

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This article is part of TPM Cafe, TPM’s home for opinion and news analysis. The author is a senior editor at Worth magazine.

Accused child sex trafficker Jeffrey Epstein and his fair-weather friend Donald Trump have a lot in common.

Both of these men have been accused of various sex crimes and other gross misbehavior. They both went to the same parties. And they both have likely lied to the public — at the very least, they’ve failed to disavow claims — about being billionaires. They have relied on the New York City business press to propagate this myth for them. One fake billionaire is a surprise. Two, though, is a pattern.

What’s going on? Why have so many news outlets indicated these men are billionaires, a term which carries with it an air of real-world power, might and accomplishment, if it’s unclear that they are?

Billionaires — like them or not — are the new aristocrats of the world; it is a title that must literally be earned (or inherited, as the case may be). Although Epstein’s worth at least $500 million, there’s little evidence that he ever broke ten figures (Forbes, to its credit, does not include him in its ranking of billionaires). Indeed, his own attorneys told a Manhattan judge in a bail hearing that his assets only totaled $559 million, almost a third of which is tied up in illiquid real estate (more details are expected in the coming days).

Most of Epstein’s money seems to have been earned managing other wealthy individuals’ fortunes, although Epstein’s only known client was Victoria’s Secret founder Les Wexner, and that relationship seems to have ended years ago. Epstein’s firm was registered in the Virgin Islands and generated no known public reports. Some have speculated that in reality he was running a Ponzi scheme, a theory buoyed by the fact that he spent his early years in finance working for Steven Hoffenberg who, in the early 1990s, was imprisoned for running a $450 million Ponzi scheme. Adding to the fishiness of Epstein’s fortune, in 2003 Vanity Fair reporter Vicky Ward quoted various sources who said most of his business essentially consisted of high end bounty hunting — recovering stolen funds for very rich people.

Trump’s finances are similarly murky — we don’t know what the President is worth. But we do know that he lies about his wealth, such as in a reported incident when he was applying for a loan from Deutsche Bank. He said he was worth over $3 billion, while the bank’s employees concluded he was worth only $788 million.

But $788 million is still a lot. Given that, what value is there in the press naming pretenders such as Epstein and Trump to the rarified ranks of the billionaires? And why do they stay silent about the inflation of their net worth?

By way of explanation, I’d like to regale you with Hans Christian Andersen’s “The Emperor’s New Clothes.” In this fairy tale, the ruler of the land is such an inveterate narcissist that he forsakes traditional imperial tasks, such as reviewing his soldiers, except when he has a new outfit to show off. This potentate loves clothes.

One day, “two swindlers” come along and tell the emperor that they are the most skilled weavers in the world. They tell the king that they are so skilled, in fact, that “this cloth had a wonderful way of becoming invisible to anyone who was unfit for his office, or who was unusually stupid.”

Most readers are probably familiar with the rest. The scammers weave and weave their magical fabric. The emperor is interested in their progress but sends a trusted advisor to report back. He, of course, does not see anything, because there is nothing to be seen. “Can it be that I’m a fool?” the old man asks himself. “I’d have never guessed it, and not a soul must know. Am I unfit to be minister? It would never do to let on that I can’t see the cloth.”

Instead, the old advisor tells the swindlers that the fabric is just beautiful, “enchanting,” in fact. They continue to “explain the intricate pattern” and name all the colors, so as to give the old man plenty to report back. Indeed, he returns and dutifully parrots the same to the emperor. The pattern repeats itself, and eventually the emperor himself, rather than admit that he cannot see the fabric and thus would be unworthy to rule, likewise engages in the charade.

The circle is complete — the swindlers say the fabric is beautiful, the emperor, a pure narcissist, can’t admit that he isn’t fit for office, and his courtiers are so cowed that they can’t provide a reality check to the potentate. Everybody is better off engaging in the lie. This continues until the Emperor dons the clothes that do not exist and parades through the street accompanied by his men. The people praise the clothes until a child finally says the obvious: “But he hasn’t got anything on.”

The reality is that estimations of net worth — the wealth that an individual has accrued — are more an art than a science in many cases. An individual’s net worth is ordinarily a private matter, and the wealthier people become, the more private they tend to be. Calculating net worth often requires back of the envelope math using public information — publicized salaries, bonuses, property values and art acquisitions, for instance — that does not necessarily account for invisible changes in asset values, debts, assets owned by family members, subjective valuations of things such as personal brands, or assets squirreled away in shell companies. Under- and over-estimation are always a risk. Yet this scenario at least assumes that you’re doing your homework. Less careful journalists may simply throw in the world “billionaire” here or there in a poetic attempt at saying “really, really rich.” This is certainly lazy and surely common.

And I’ll let you in on a dirty secret: Coverage of the wealthy, like all journalism, depends on maintaining a certain level of access to your subjects. Unfortunately, it’s easy enough for the maintenance of access to turn into the stroking of egos. In the case of Epstein, it’s not hard to see how a very wealthy man, who says that his firm only takes billionaires as clients, becomes a billionaire in the words of journalists interested in accessing his voluminous network that includes everyone from Donald Trump to Bill Clinton to Alan Dershowitz.

In the case of Donald Trump, his entire brand and business was built on projecting the image of being really, really rich. “Centimillionaire Donald Trump” doesn’t exactly roll off the tongue. Actively promoting the idea that he was in the Three Comma Club was good for Trump’s business, and Trump was always good copy for reporters covering New York society. For many years, declaring Trump a billionaire was a win-win: he’d give out quotes like candy in exchange for a little shine.

In both cases, Epstein’s and Trump’s networks, including everyone from Harvard economists to prominent politicians, lent them credibility. They must be the real deal, else why would all these important, connected, wealthy people hover around them so?

Put simply, saying that Donald Trump and Epstein were like the emperor — naked, possibly deluded narcissists — brought little gain for most observers, yet carried with it the risk of becoming enemies to powerful, potentially litigious men with lots of friends.

For me, there’s another question: Now that they’re exposed, why don’t men like Trump and Epstein at least come clean about their inflated wealth? The last lines of the fairy tale include a clue: “’But he hasn’t got anything on!’ the whole town cried out at last. The Emperor shivered, for he suspected they were right. But he thought, ‘This procession has got to go on.’ So he walked more proudly than ever, as his noblemen held high the train that wasn’t there at all.’”

The key, I think, is pride. Wealth, power and manhood, particularly for those most brittle and twisted souls, are inextricably linked. Were they to admit that they’re not actually quite so rich — that much of the press was getting it wrong — they would puncture the illusion that both men used to buoy their career. What else would they have to admit? That they prey on the weak? That they live lives without goodness? This realization could be a turning point. But truth be told, it’s scary, weak and humbling to be naked. And if everyone is willing to buy into the lie, why bother?

 


Benjamin Reeves is senior editor, special projects at Worth magazine where he covers wealth, finance and power and edits the publication’s annual Power 100 ranking. He also hosts Worth’s Power & Impact podcast, contributes to Columbia Business School’s thought leadership publications, and is a former foreign correspondent in Latin America. He is a graduate of Knox College and earned an MA in Experimental Humanities from NYU and is an MFA candidate in screenwriting at the Feirstein Graduate School of Cinema at Brooklyn College. Follow him on twitter: @bpreeves.

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Like many, I spent Wednesday, July 17 reflecting on the wonderful year I spent clerking for Justice John Paul Stevens. As others have said, he was a fine man — brilliant but unassuming, decisive but persuadable, sure of his views but gentle in expressing them, and guided through it all by a moral compass sorely lacking in so many of today’s public figures.

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This article is part of TPM Cafe, TPM’s home for opinion and news analysis.

Joe Biden’s opposition to busing for school desegregation in the 1970s reveals how white liberalism played a central role in defending suburban racial and class privilege against civil rights challenges. The controversy also exposes the hypocrisy of those who draw a sharp historical distinction between “de jure” (legal, state-mandated) segregation in the Jim Crow South and “de facto” (allegedly private and market-based) segregation in the North and West.  

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This article is part of TPM Cafe, TPM’s home for opinion and news analysis.

It is more than a little painful to think today about how Justice John Paul Stevens would have handled some of the cases that have proven so vexing for the current Court in the era of Donald Trump.

He would not, for example, have struggled much to recognize that the reason offered by the Commerce Department for adding citizenship to the census was a pretext. There was no evidence in the record in that case that administration officials were genuinely interested in enforcing the Voting Rights Act, as it claimed; there was plenty of evidence elsewhere that administration officials had an entirely different agenda in mind.

Neither would Stevens have hesitated to see through the administration’s claims that the President’s order banning entry of certain foreign nationals into the United States was supported by the national security justification the President’s lawyers offered in its defense. Trump had campaigned and won on a platform that included overt religious discrimination. Stevens would have found it impossible to ignore that reality. It was his lifelong custom as a lawyer and judge: he always started with the facts.

Proof of Stevens’ commitment to taking the cases as he found them — in all their messy truth — is everywhere in his jurisprudence, perhaps most striking in what was at the time his shocker of an opinion for a 5-3 majority in 2006’s Hamdan v. Rumsfeld. The Court there struck down President George W. Bush’s novel system of military commission war crimes trials at Guantanamo Bay as beyond the President’s power under law. Among other things, Justice Stevens explained, Congress had years earlier passed a law providing that the rules for any war crimes trials had to be the same as those available in ordinary, A Few Good Men-style courts martial, unless having the same rules actually proved “impracticable.”

As conventional wisdom had it at the time, questions like what process was “practicable” for trying alleged enemy fighters was tailor made for the President — not the courts — to decide. The executive branch had special expertise in such matters of national security, and was most especially entitled to deference on such matters when there was still a war on. The laws are not “silent in time of war,” Chief Justice Rehnquist had written before his death the term Hamdan was decided, “but they will speak with something of a different voice.”

Justice Stevens himself had more than ample reason to embrace such claims of deference to executive branch views. The Court’s last remaining World War II veteran, a naval cryptographer decorated with a Bronze Star for his work, the justice knew more acutely than any of his colleagues about the value of military expertise. More, the justice has written what no doubt remains among the most cited Supreme Court decisions of all time, his publicly obscure but legally pivotal 1984 opinion in Chevron v. Natural Resources Defense Council, holding that when an act of Congress is unclear, judges should usually defer to the executive agency’s interpretation of the law rather than impose their own estimation of what Congress meant.

But in the face of the President’s claims in Hamdan that the danger posed by international terrorism demanded rather fewer rights for war crimes defendants than the law might otherwise require, Justice Stevens found the evidence lacking. Without “for one moment underestimating” the danger of terrorism, the justice wrote, the President could point to “no specific reason in the record” that ordinary court martial rules would not work. “There is no suggestion, for example, of any logistical difficulty in securing properly worn and authenticated evidence or in applying the usual principles of relevance and admissibility.” And all around the record — amicus briefs and reports making clear that the administration had adopted the commission rules over the objections of executive branch experts, and of senior military leaders including the Army judge advocate general himself. To any consumer of reality, the right outcome was clear.

Justice Stevens admired John Roberts when he appeared as an advocate before the Court, as Roberts often did before he was appointed to take the late Chief Justice Rehnquist’s seat. Stevens thought Roberts a wonderful lawyer; it was among his highest forms of praise. The justices, of course, disagreed regularly and mightily after Roberts joined the bench. But that would hardly have stopped Stevens from endorsing, with the strength of a lifetime’s commitment, Roberts’ decision to vote against the President in the census case on the grounds that the Commerce Department was lying about its aims. The Court, Roberts quoted, is “not required to exhibit a naiveté from which ordinary citizens are free.”

Anachronistic it may seem, but Justice Stevens believed in such a thing as fact. And he believed it mattered, above all, to law. Would that we had him on the bench still.

 


Deborah Pearlstein is Professor and Co-Director of the Floersheimer Center for Constitutional Democracy at Cardozo Law School, where she teaches constitutional law, international law, and national security law. Her work on national security and the separation of powers has appeared widely in law journals and the popular press, and she has repeatedly testified before Congress on topics from military commissions to congressional war powers. A magna cum laude graduate of Harvard Law School, Pearlstein clerked for Judge Michael Boudin of the U.S. Court of Appeals for the First Circuit, then for Justice John Paul Stevens of the U.S. Supreme Court.

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We now know all too well that in the run-up to the Great Recession, policymakers failed to spot what was coming. Central banks around the world — including the Federal Reserve in the U.S., the Monetary Policy Committee in the UK and the European Central Bank in the Eurozone — missed the big one in their own countries but also failed to see that the crisis was global; one down, all down. In October 2008 members of the Federal Reserve’s Federal Open Market Committee predicted that real GDP growth in the U.S. in 2009 would be in the range -1.0% to +1.8%. We got -2.54%.

Miscalculations like this have real consequences. We now know that the U.S. went into recession in December 2007, as determined by the National Bureau of Economic Research’s Business Cycle Dating Committee, while almost every other advanced country did so in April 2008. My new book, “Not Working: Where Have all the Good Jobs Gone?” sets out in great detail how policymakers missed this catastrophe, even as it was upon them.

The Fed wrongly, in my judgment, raised rates nine times between 2015 and 2018 because of its mistaken belief that the U.S. was at full employment. During that time, other measures, especially weak wage growth, suggested that full employment was still a long way off. Trump sensed that and has rightly been pushing for rate cuts.

Two years after the 1929 Great Crash, economist John Maynard Keynes warned presciently that a financial crisis is especially hard to recover from and that growth would inevitably be slow. “It is a possibility that the duration of the slump may be much more prolonged than most people are expecting, and much will be changed both in our ideas and in our methods before we emerge,” he said. He was not talking, he said, about “the duration of the acute phase of the slump,” but about “the long, dragging conditions of semi-slump, or at least sub-normal prosperity, which may be expected to succeed the acute phase.”

Today, more than a decade after the Great Recession began, we are still mired in those “long, dragging conditions of semi-slump.” On the campaign trail, Donald Trump cleverly spotted that. Global recovery has been muted in the years after the 2008-2009 recession and people are hurting even after ten years of growth in what is now the longest U.S. recovery ever. Pain, anxiety, depression and a general sense of helplessness are all up. Happiness is down. Trump tapped into those feelings.

The rise of deaths of despair — from drug overdoses, liver failure from heavy drinking and suicide — in rural America and the urban heartland, especially among least-educated whites, was rapidly becoming a plague. Americans are increasingly in pain, not alleviated by the huge rise in opioid prescriptions. Life expectancy in the U.S. is falling.

The votes for Trump — and, as I show in “Not Working,” for Brexit also — were reflections of the insecurity, hopelessness and isolation that people were feeling, especially those who had been left behind in the recovery. Old coal and steel towns were suffering. People voted for Trump because they thought he could bring about change.

There was, of course, another force at play, too: History tells us that people suffering through a drawn-out recession tend to look around for who to blame. When people are hurting, it is easy to find scapegoats, and immigrants are often targets. In the 2016 presidential election, Donald Trump carried 26 of the 30 states in which the share of residents born abroad is the smallest, according to five-year (2011–15) estimates from the Census Bureau’s American Community Survey. Native-born residents account for 91 percent of the population in states Trump won versus 81 percent in states he lost. Trump ran on an anti-immigrant platform. Most U.S. voters view immigrants positively, but most Trump voters don’t. Residents of London, Paris and New York, which contain lots of immigrants, had more in common with each other than they did with the residents outside the big cities in their own countries.

Trump voters also tended to live in the areas that were struggling most. The good jobs had gone for many, and Trump placed himself as flyover America’s own belligerent champion. He saw the hurt that was occurring — and the discontent with the exam-taking classes, who were doing just fine, thank you, while many, especially the less skilled, were not.

Trump on the campaign trail repeatedly argued that despite claims from the Obama administration that full employment was approaching, the unemployment number “is totally fiction” and there were simply too few decent jobs available for those who wanted them. He was clearly on to something. By the election in November 2016, the unemployment rate was 4.7% but other labor market measures told another story. Employment as a proportion of the adult population then was 60%, versus 63% at the start of the recession in 2008. The underemployment rate, which measures how many hours workers would like to work, was also well above its starting levels. Trump had spotted that the U.S. labor market was nowhere close to full employment.

Between 2015 and 2018, largely based on the FOMC’s view that the U.S. labor market was close to full employment, the Fed, wrongly in my view, raised rates nine times; once in 2015 and 2016; three times in 2017 and four times in 2018. At the end of 2018 Fed was forecasting further rate rises to come in 2019 and 2020. In doing so, it relied on models that date from the 1970s, when the economy was quite different. Crucially, unions were far more powerful then than they are today. In 2019, these models are long out of date, but economists have continued to rely on them, and wonder why there is neither inflation nor the wage growth they expect to come with it.

As a result, Trump turned on the Fed and argued that rates were too high and that there should in fact be cuts. He even went after the chair of the Fed, Jay Powell, threatening to fire or even demote him. In my book I argue “the Fed had been signaling more rises to come; President Trump turned his ire toward them, and they changed their tune in 2019. I have to say I agree with him.” I still do.

During questioning by Rep. Alexandria Ocasio-Cortez (D-N.Y.) at the House Financial Services Committee yesterday, Powell essentially admitted that the Fed had wrongly raised rates because it thought the U.S. was close to full employment when it wasn’t.

“Do you think it is possible that the Fed’s estimates of the lowest sustainable estimates for the unemployment rate may have been too high?” Ocasio-Cortez asked Powell.

“Absolutely,” he replied.

“So, we overshot in what our long-term unemployment rate is?” she followed up.

“I think we have learned that it is lower, substantially lower than we thought,” the Fed chairman replied.

Ocasio Cortez went on to question Powell on the Phillips Curve, an economic model that supposes that low unemployment drives the rate of wage growth, and, with it, inflation. It is key to the Fed’s economic models. But that theory, she said, “is no longer describing what is happening in today’s economy.” Powell agreed.

The next day, National Economic Council director Larry Kudlow said “hats off to Ms. AOC” for her questions, saying she “kind of nailed that.” Trump and AOC agree on the need to cut rates and so do I. More policy errors by the elites.

“Not Working” shows that, now, wage growth is driven not by unemployment but by underemployment, which has still not returned to pre-recession levels. That explains the weak wage growth we see today, and why the U.S. is not yet at full employment.

Nonetheless, the markets suggest that investors expect three rate cuts by the Fed by the end of 2019 and probably even more in 2020 as the U.S. economy likely slows or even goes into recession. Trump was right, if perhaps for the wrong reasons — he is worried about the economy’s, and the Fed’s, influence on his reelection chances for 2020.

I disagree with Trump on many things, including the trade war. But on jobs, sub-normal prosperity and interest rates he has been vindicated.

 


David G. Blanchflower is the Bruce V. Rauner Professor of Economics at Dartmouth College, professor of economics at the University of Stirling, and a research associate at the National Bureau of Economic Research. He is the co-author of “The Wage Curve” and the author of “Not Working: Where Have all the Good Jobs Gone?” He lives in Canaan, New Hampshire. Follow him on Twitter: @D_Blanchflower.

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This article is part of TPM Cafe, TPM’s home for opinion and news analysis. It was published here and on the website for the Brennan Center for Justice.

Since Thursday, Chief Justice John Roberts has been winning praise for independence and fair-mindedness after blocking — at least for now — the Trump administration’s bid to rig the census by adding a question on citizenship. But let’s be clear: by giving a green light to partisan gerrymandering in an opinion released the same day, Roberts and the rest of the court’s conservative bloc dealt a body blow to American democracy.

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Editor’s note: The following excerpt is adapted and condensed from Jonathan Fetter-Vorm’s “Moonbound: Apollo 11 and the Dream of Spaceflight.” The graphic novel commemorates the fiftieth anniversary of the man landing, conjuring “the long history of the visionaries, star-gazers, builders, and adventurers who sent Apollo 11 on its legendary voyage.”

This chapter explores how Nazi scientists sowed the seeds for what would become the U.S. space program. 

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