RUTHFULLY YOURS

WASHINGTON—Declining business investment is hobbling an already sluggish U.S. expansion, raising concerns about the economy’s durability as the presidential campaign heads into its final stretch.

Gross domestic product, the broadest measure of goods and services produced across the U.S., grew at a seasonally and inflation adjusted annual rate of just 1.2% in the second quarter, the Commerce Department said Friday, well below the pace economists expected.

Economic growth is now tracking at a 1% rate in 2016—the weakest start to a year since 2011—when combined with a downwardly revised reading for the first quarter. That makes for an annual average rate of 2.1% growth since the end of the recession, the weakest pace of any expansion since at least 1949.

The output figures are in some ways discordant with other gauges of the economy. The unemployment rate stands at 4.9% after a streak of strong job gains, wages have begun to pick up, and home sales hit a post-recession high last month.

Consumer spending also remains strong. Personal consumption, which accounts for more than two-thirds of economic output, expanded at a 4.2% rate in the second quarter, the best gain since late 2014.

On the downside, the third straight quarter of reduced business investment, a large paring back of inventories and declining government spending cut into those gains.

“Consumer spending growth was the sole element of good news” in the latest GDP figures, said Gregory Daco, an economist at Oxford Economics. “Weakness in business investment is an important and lingering growth constraint.”

WASHINGTON — Computer systems used by Hillary Clinton’s presidential campaign were hacked in an attack that appears to have come from Russia’s intelligence services, a federal law enforcement official said on Friday.
The apparent breach, coming after the disclosure last month that the Democratic National Committee’s computer system had been compromised, escalates an international episode in which Clinton campaign officials have suggested that Russia might be trying to sway the outcome of the election.
Mrs. Clinton’s campaign said in a statement that intruders had gained access to an analytics program used by the campaign and maintained by the national committee, but it said that it did not believe that the campaign’s own internal computer systems had been compromised.
The Democratic Congressional Campaign Committee, the fund-raising arm for House Democrats, also said on Friday that its systems had been hacked. Together, the databases of the national committee and the House organization contain some of the party’s most sensitive communications and voter and financial data.
Meredith Kelly, a spokeswoman for the congressional committee, said that after it discovered the breach, “we immediately took action and engaged with CrowdStrike, a leading forensic investigator, to assist us in addressing this incident.”The attack on the congressional committee’s system appears to have come from an entity known as “Fancy Bear,” which is connected to the G.R.U., the Russian military intelligence service, according to an official involved in the forensic investigation.
The same arm of Russia’s intelligence operation was also implicated in the attack on the national committee, in which it gained access to opposition research on Republicans, including the party’s presidential nominee, Donald J. Trump.
“It’s the same adversary,” the official involved in the forensic investigation said. “These are sophisticated actors.”
The F.B.I. said on Friday that it was examining reports of “cyberintrusions involving multiple political entities” but did not identify the targets of the attacks.
The Clinton campaign used the program that was hacked to analyze voter data, but it did not contain voters’ Social Security numbers or credit card information, a campaign aide said. The campaign said it was confident, based on a review by outside experts, that getting into the program would not have allowed the hackers to gain access to the campaign’s internal emails, voice mail messages or other data.

Friends and Colleagues, some travel over the last couple of weeks left me unable to circulate columns and posts as usual (and some time off meant there were fewer of those anyway). Today I am sending out the latest, including the full version of a feature article about Hillary Clinton written for the print version of National Review, from our August 1 special Democratic Convention issue (which is available online only to subscribers). Links to other columns are below that article. Hope everyone enjoys what’s left of the summer. All the best, Andy
In early July, in a performance as legally baffling as it was politically predictable, Federal Bureau of Investigation director James B. Comey recommended against a felony prosecution of the former secretary of state and certain Democratic presidential nominee. The recommendation was gratuitous: It is the FBI’s function to investigate crimes; the Justice Department alone exercises charging discretion. It is a commonplace for case agents and government prosecutors to consult on both investigative tactics and charging decisions. It is a rarity, though, for the FBI director to get directly involved in, much less make, an indictment decision. That, in effect, is what Comey did. That his recommendation was uncalled for makes it all the more indefensible.

To stick for a moment with the FBI’s actual function, let’s note that its agents performed admirably, particularly in the forensic aspects of the investigation: the examination of Mrs. Clinton’s “homebrew” servers, the painstaking reassembly of millions of bits of data into thousands of e-mails (out of the 30,000 e-mails that Clinton and her phalanx of lawyers and aides had quite intentionally sought to delete and destroy). The FBI thus carried its burden to uncover evidence that can be used to establish the essential elements of crimes defined in federal penal laws. In this instance, according to Director Comey’s unusually transparent and devastating account of what his investigators found, it is simply incontestable that then–secretary of state Clinton (a) mishandled classified information in a manner that was grossly negligent (indeed, Comey called it “extremely careless”) and (b) concealed and destroyed federal records.

Yet Comey claimed not only that no prosecution was warranted but also that no reasonable prosecutor could disagree with this conclusion. The first assertion is flatly wrong; the second is breathtaking, and it evoked aptly spirited dissenting reactions from such iconic former prosecutors as Rudolph W. Giuliani, the former New York City mayor who, as U.S. attorney in Manhattan, hired Comey as a young prosecutor in the mid Eighties, and Michael B. Mukasey, the distinguished former federal judge who served as U.S. attorney general in the George W. Bush administration not long after Comey served as deputy attorney general. (Like Comey, whom I have known as a friend and sometime colleague for nearly 30 years, I was hired as an assistant U.S. attorney by Mr. Giuliani.)

When Comey testified before a House committee just two days after rejecting an indictment of Clinton, the flaws in his rationale were painfully apparent. He suggested that “American tradition” and the Constitution forbid criminal prosecution on an offense as serious as mishandling classified information — a felony carrying a potential ten-year prison term — if the required mens rea (state of mind) element of the crime in the relevant statute calls for mere negligence rather than intent to do harm. To the contrary, many state and federal crimes do not require proof of intentional or willful wrongdoing — indeed, virtually every state has long criminalized negligent homicide. Moreover, Comey inaccurately portrayed the gross-negligence offense as if it were an isolated excrescence in federal law; in fact, it is the bottom of a sliding scale of crimes involving national-defense secrets, carefully calibrated by Congress so that the most serious offense — classic espionage involving intended harm to the U.S. — is at the top. Appropriately, the least serious offense of gross negligence involving national-defense secrets is narrowly tailored: It applies not to all Americans but to officials with security clearances who are intimately familiar with rules governing their special obligation to safeguard intelligence.

But in any case, far from being merely negligent, Clinton’s outrageous conduct screams of willfulness. She intentionally set up an unlawful non-government communication system specifically to evade federal disclosure and accountability laws. In her position at the pinnacle of American foreign relations, she had to know it was inevitable that extremely sensitive intelligence matters would be discussed over the system. The hundreds of classified e-mails discovered included 110 (in 52 e-mail chains) sent or received by Clinton herself. Seven of these involved “top secret/special access program” intelligence — the most highly classified secrets in government, concerning deep-cover informants and closely guarded intelligence-collection techniques (meaning: information the revelation of which can get our agents killed and fold up vital national-security operations).

“Any reasonable person in Secretary Clinton’s position,” Comey admonished, “should have known that an unclassified system was no place for” such exchanges. The director further acknowledged that Clinton’s homebrew system was woefully unsecure: It would have been better, though still against the rules, to use Gmail. Top Clinton aides exacerbated these security compromises, Comey recounted, by using unsecure communication systems while they were outside the United States and “in the territory of sophisticated adversaries.” Clinton clearly knew this practice was a major security breach, assuming she read her own memoir Hard Choices, which — though unmentioned by Comey — takes pains to describe the extraordinary communications precautions that must be taken overseas. The director, in fact, said it was almost certain that Clinton’s system had been penetrated by hostile foreign intelligence operatives (the deftness of whose methods prevents apodictic certainty). He further ruefully observed that, under Clinton, “the culture of the State Department in general” was cavalier, compared with that of other government agencies, when it came to safeguarding intelligence.

Thomson Reuters BRENDAN O’BRIEN, IAN SIMPSON, W SIMON AND BILL TROTT

A San Diego police officer was fatally shot and another was wounded late on Thursday, the police department said on Friday, adding one suspect was taken into custody.

The officers, members of the department’s gang suppression unit, were shot during a traffic stop at about 11 p.m. PDT (0600 GMT) in Southcrest, a neighborhood in southeast San Diego, the San Diego Union-Tribune reported. The officers were taken to hospitals.

“It is with a very sad heart that we announce the death of one of our officers tonight,” the department said on Friday on its Twitter feed.

The second officer underwent surgery and is expected to survive, it said.

The police department said it was searching for suspects in addition to the one in custody.

The facts are by now widely known, if still not nailed down with precision. On Friday, July 22, on the eve of the Democratic National Convention, a massive trove of emails purloined from the Democratic National Committee (DNC) by hackers was posted on WikiLeaks, the online bulletin board for leaked information founded by the Australian anarchist Julian Assange. Strong evidence rapidly emerged showing that the hackers were connected to or under the control of Russian intelligence. As the press picked through the mildly juicy revelations, the favoritism of the supposedly neutral DNC toward Hillary Clinton and against Bernie Sanders was put before the world to see.

The result has been a continuing maelstrom. Supporters of Sanders, already agitated for having to swallow the bitter pill of defeat, were inflamed. Backers of Hillary, embarrassed and chagrined, decried the apparent Russian interference in party affairs. It did not take long for the head of the DNC, Debbie Wasserman Schultz, to be unceremoniously purged from her position and for the newly cleansed DNC to issue an apology to Sanders and everyone else it had wronged.

There the story has paused, but it is hardly over. There are grounds to believe that the Clinton Foundation was also hacked and quite possibly Hillary’s vulnerable private server at her home in Chappaqua, N.Y., which housed her official emails during her tenure as secretary of state, including the 33,000 or so that she and her lawyers wiped from the memory because they were deemed “personal.”

The worry, of course, is that Russian intelligence has all of these, and that many more damaging disclosures of Clinton shenanigans are yet to come. Donald Trump, startling the world, has called upon the Russian government, if it did hack Hillary’s emails, to release them, with the obvious aim of injuring Hillary’s campaign and boosting his own. If that is indeed what happens, and WikiLeaks blasts new revelations onto the net on the eve of the elections in an October surprise, it could well propel Trump into the White House. That is exactly what Assange, who publicly favors Trump over Clinton, and who claims to have more of her secrets in his quiver, is threatening. The prospect has liberals wringing their hands.

A case in point is Franklin Foer, the former top editor at the New Republic and now a contributing editor at Slate. To Foer, the DNC email scandal is the sum of all his fears. “A foreign government,” he writes, “has hacked a political party’s computers .  .  . stolen documents and timed their release to explode with maximum damage. It is a strike against our civic infrastructure.” It is “trespassing, it’s thievery, it’s a breathtaking transgression of privacy.”

One cannot disagree. But how does this particular data breach, one is left wondering, differ from the leaks that Foer and other liberals routinely celebrate as the stock in trade of American investigative journalism?

Foer has a ready answer: What is especially “galling about the WikiLeaks dump,” he explains, is that it “has blurred the distinction between leaks and hacks.” Hacks, to Foer, are bad, conducted by bad people for bad purposes. The Russian hack, he writes, is the equivalent of Watergate: “To help win an election, the Russians broke into the virtual headquarters of the Democratic Party. The hackers installed the cyber-version of the bugging equipment that Nixon’s goons used—sitting on the DNC computers for a year, eavesdropping on everything, collecting as many scraps as possible.”