How blue states might save Obamacare’s markets

The looming demise of Obamacare’s individual mandate is spurring talks in a handful of blue states about enacting their own coverage requirements, as state officials and health care advocates fear repeal will roil their insurance markets.

Republicans in Congress are poised to kill off the individual mandate in their sweeping tax overhaul, knocking out one of Obamacare’s most unpopular features — but one that health experts have said is essential to making the law’s insurance marketplaces function.

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Blue state officials, who have been working to protect their insurance markets from the Trump administration’s efforts to dismantle the health law, are beginning to grapple with strategies for preserving coverage. Those officials — in California, Connecticut, New Jersey and elsewhere — aren’t ruling out a state-level requirement that residents must obtain health insurance.

But even in the most Obamacare-friendly states, trying to implement an individual mandate could be politically risky, particularly in an election year.

In Maryland, the co-chair of a key health care commission said an individual mandate may be the most effective way of saving the state’s insurance market from collapse.

“That’s the one that seems the most clearly in the cards,” said Maryland state Sen. Brian Feldman, a Democrat whose commission will soon issue a report to the legislature on how to protect coverage. “I’m fairly confident there will be a bill if the tax plan results in a repeal of the individual mandate.”

Feldman acknowledged the legislature could pursue other, potentially less controversial methods, for tamping down insurance premiums and preserving coverage. However, he said a state mandate would have one clear benefit — Maryland wouldn’t need federal permission to enact one.

“In this climate, I would gravitate toward the things that we have control of in the state of Maryland rather than floating options that the Trump administration would have to approve,” he said.

A state-level mandate “has been high on our list ever since the threat began to the Affordable Care Act in Washington,” said Vincent DeMarco, president of the Maryland Citizens Health Initiative, a consumer advocacy group.

Supporters of the Affordable Care Act insisted the individual mandate — no matter how unpopular — was necessary to nudge healthy people into buying insurance, helping insurers offset the costs of sick patients who could no longer be denied coverage. Though the mandate’s relatively low tax penalty has proven weaker than expected, insurers still see it as a key tool and could flee the marketplaces without it.

Repealing the Obamacare mandate would lead to 13 million more uninsured people in a decade and increase average individual premiums by 10 percent, a recent analysis from the CBO concluded.

“If you get rid of the individual mandate, it’s bad for everything,” said Connecticut Lt. Gov. Nancy Wyman, a Democrat who chairs the board of the state’s Obamacare exchange.

Wyman earlier this year convened a group with four state legislators to study how Connecticut could prevent people from losing coverage if Congress gutted Obamacare. She said they haven’t thoroughly deliberated a state-level mandate, but she believes they’ll consider the option.

“Everybody is looking at ways to see … how we could come up with a plan for ourselves,” she said.

States most likely to explore a coverage requirement are the nearly dozen running their own Obamacare marketplaces, which tend to have Democratic governors. They have a greater stake in ensuring their markets function properly, said Rosemarie Day, a Massachusetts health consultant who over a decade ago helped launch the state’s insurance marketplace — the model for Obamacare.

Still, another former Massachusetts health official was skeptical that Democrats would push for state coverage requirements.

“I doubt it,” said Jon Kingsdale, who led the Massachusetts insurance marketplace. “It’s the single most unpopular piece in Massachusetts.”

Washington state, which operates its own exchange, would struggle to find a coverage mechanism since the state doesn’t have an income tax, Insurance Commissioner Mike Kreidler said in an interview. Still, he said officials are exploring whether the state would implement something compelling people to get covered.

“We’re very engaged in discussion as to what our options would be,” Kreidler said, noting the state’s history of dealing with Obamacare-style insurance rules without an individual mandate in the 1990s. Insurance premiums skyrocketed when healthy people avoided buying coverage, and the state’s insurance market collapsed.

“We have the advantage of having the discussions we went through in the early ’90s,” Kreidler said.

In California, the head of the state’s Obamacare exchange recently raised the possibility of a state mandate as one of several options to stabilize its market. But even blue states can have fraught politics when it comes to raising taxes. Measures to raise revenue in California require a two-thirds majority of both legislative chambers, and Democrats have temporarily lost a supermajority in the Assembly after two lawmakers resigned over sexual harassment allegations.

Officials in New Jersey, where Democrats will fully control state government next year, also wouldn’t rule out a state-level mandate.

“Everything’s got to be on the table,” said New Jersey Gov.-elect Phil Murphy earlier this week when asked about the possibility of enacting a statewide mandate.

Democratic state Sen. Joe Vitale, who chairs a health care committee, said he would consider it, adding that he is evaluating several options with a working group.

“There’s a lot to think about in terms of how we would do it, what it would cost and could it be successful,” he said.

There’s at least one state that would have an individual mandate if Congress repeals Obamacare’s coverage requirement. Massachusetts, which pioneered the idea in 2006, never canceled its mandate, even after Obamacare instituted one nationally in 2010.

Katie Jennings, Victoria Colliver and Joanne Kenen contributed to this report.

Wave of misconduct claims reshape 2018 elections

The wave of sexual harassment allegations on Capitol Hill is already beginning to reshape the 2018 election landscape, crushing some campaigns under its pressure but providing breakthrough opportunities for others.

Sexual harassment-related scandals have already claimed four House members — Rep. John Conyers (D-Mich.), Rep. Trent Franks (R-Ariz.), Rep. Blake Farenthold (R-Texas) and Rep. Ruben Kihuen (D-Nev.), who announced Saturday he would not seek reelection after his own party leadership called for his resignation.

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In Minnesota, the resignation of Democratic Sen. Al Franken has thrown a wrinkle into the 2018 Senate map — now, party strategists must contend with the prospect that his appointed successor, Tina Smith, will receive a competitive challenge when she attempts to win a full term.

Members of Congress aren’t the only ones being felled by new revelations. On Friday, a female candidate, Andrea Ramsey, quit her Democratic bid to challenge Rep. Kevin Yoder (R-Kan.) after news broke that her company settled a sexual harassment suit, even though she denies the allegations.

Yet the nation’s moment of reckoning on sexual harassment isn’t simply shaking up the upcoming midterm election by forcing candidates and incumbents out of races — it’s also altering the traditional terms of debate. In Florida, where Democrat Mary Barzee Flores is running in a crowded primary to replace retiring GOP Rep. Ileana Ros-Lehtinen, the former circuit judge focused her first ad on the issue of sexual misconduct in the workplace.

“I’ve heard about other candidates who are speaking out and it wouldn’t surprise me if, more and more, women talk about this,” said Flores, whose ad pointed to an old boss who assaulted her. “We’re making it clear that we’re not just going to sweep this stuff under the rug.”

In one competitive Northern Virginia race, the issue is center stage in part due to Rep. Barbara Comstock (R-Va.) who is leading the charge in Congress, along with Rep. Jackie Speier (D-Calif.), to reform how sexual harassment cases are handled. On the Democratic side, Lindsey Davis Stover, a former Obama official running in a crowded primary field, filed a Freedom of Information Act request to “reveal the secret payouts authorized in congressional sexual misconduct” cases, according to a statement from her campaign.

What’s still unclear is how the spate of sexual harassment scandals might sway voters in 2018. Early public polling suggests Democratic voters are more likely to believe accusations of misconduct than Republicans. A Monmouth University poll released this week found that 37 percent of Republicans believe such reports about GOP legislators are accurate, while 63 percent of Democrats trust those reports about Democratic lawmakers.

“The struggle lies in the fact that [sexual harassment] is coming out in races across the country — in legislative bodies, in federal bodies and in both parties. Every time it happens, even in in some other state, it affects the mindset of voters,” said Luke Macias, a Republican consultant based in Texas.

Some GOP strategists’ worry their party’s response to various scandals could further hurt them among suburban voters and women, two blocs that they can’t afford to lose as they try to defend their 24-seat majority in the House.

“The loss of urban and suburban voters in 2016 plus sexual harassment scandals is probably not a good way to secure these moderate Republican and Independent voters long-term,” said Kevin Schuvalov, a Republican strategist based in Texas. “It’s an opening for Democrats to go get voters who aren’t naturally available to them.”

Republican pollster Robert Blizzard warned that “women voters, especially Independent women, are a key audience in the ‘18 election up and down the ticket across the country,” so to “be perceived as weak on this issue at your own peril.”

“Candidates are waiting to see what other allegations might surface and what opportunities arise as a result,” said Martha McKenna, a Democratic consultant. “We’ve seen how suburban women react to these charges which could put even more seats in play.”

Some strategists see the issue as a potential boon for challengers in both parties, since they can recast the cascade of resignations as another example of members of Congress “expecting special treatment,” said Molly Murphy, a Democratic consultant.

“It goes more to the idea that rules don’t apply to them,” Murphy said. “That’s effective.”

There is a widespread expectation among strategists in both parties that more allegations will surface. “I think it’s when, not if,” Blizzard said.

With prominent politicians in dozens of states — including Florida, Kentucky, Oregon, among others — publicly accused of groping, unwanted kissing and sexual harassment, the sweep of accusations inspired Dana Nessel, a Democratic candidate for attorney general in Michigan, to ask in a campaign video posted to Facebook: “Who can you trust most not to show you their penis in a professional setting? Is it the candidate who doesn’t have a penis? I’d say so.”

Not everyone appreciated the spot, which drew national attention. “There are some who don’t appreciate that someone for the first time ever said the word ‘penis’ in a political ad,” Nessel said, explaining that the video was intended to be tongue-in-cheek, and “to point out that my gender isn’t a liability, but an asset.”

Nessel’s video, which drew more than 170,000 views, may not be the last provocative attempt to talk about sexual harassment.

It’s lesson, said Murphy, is that the message can easily go viral, and “some candidates will look for that opportunity to catch fire.”

Trump’s signature would end 3-decade wait for tax reform

For the large contingent of Washington supply-siders and tax cutters, the sweeping tax overhaul that President Donald Trump is poised to sign into law this week has been a generation in coming — and the culmination of half a life’s work that started during Ronald Reagan’s 1980s.

Grover Norquist, arguably the best-known anti-tax activist in the country, started Americans for Tax Reform at then-President Reagan’s request to help marshal support for the 1986 tax overhaul. He’s been working ever since to rally support for more tax cuts.

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House Speaker Paul Ryan (R-Wis.) for years said his dream job was to be House Ways and Means chairman, a position that would have allowed him to quarterback the sort of tax revamp that his mentor, the late Jack Kemp, helped get through Congress in 1986.

When he became Speaker, Ryan said he was reluctantly passing the title of Ways and Means chairman, and the opportunity to focus his attention on tax reform, to Rep. Kevin Brady (R-Texas).

Now, the 2017 tax revamp will bring the American tax system more into lockstep with those conservatives’ thinking than perhaps ever before – making the idea that what works for corporate America will work for the country-at-large a central plank of U.S. policy for decades to come, maybe even another generation or more.

“This tax cut and reform will drive further reforms and reductions for the next 50 years,” Norquist said Friday.

The corporate rate would get slashed from 35 percent to 21 percent under the GOP plan, which would also allow businesses to immediately write off investments for five years and scrap Obamacare’s individual mandate. In an extra bonus for the right, it also shrinks the deduction for state and local taxes, an incentive that mostly helps blue, high-tax states.

“This is a pretty historical moment for the conservative movement,” said Stephen Moore, another of those supply-siders, who has over the years worked at the Club for Growth, the Heritage Foundation and The Wall Street Journal editorial page.

“I’ve been in this game for 30-some years. This, if it passes, will be the single biggest policy triumph for conservatives since the 1996 welfare reform. It’s up there with the ’81 Reagan tax cuts,” added Moore, who’s an informal adviser to the president and, along with fellow supply-sider Larry Kudlow, helped then-candidate Trump craft his tax plan.

The start of the conservative tax-cutting movement is frequently traced back to 1974, when a young economics professor named Art Laffer met with an equally young Dick Cheney, then a top aide to President Gerald Ford. Meeting at a bar, Laffer doodled the case that cutting taxes can increase revenues for the government on a napkin, a theory now known as the Laffer Curve.

That case is maybe most famously argued by Kudlow, who worked in Reagan’s White House and has spent more than 15 years defending its merits on CNBC. Perhaps even more importantly, Moore said, Kudlow worked overtime to pitch the GOP tax plan to skeptical Republicans like Sens. Susan Collins (R-Maine) and Bob Corker (R-Tenn.), both of whom now seem likely to back the measure.

It might be hard to imagine now, but the Republican Party hasn’t always been dominated by would-be tax cutters. Former Senate Majority Leader Bob Dole (R-Kan.) once joked that “the good news is that a bus full of supply-siders went off a cliff. The bad news is that two seats were empty,” according to “Showdown at Gucci Gulch,” the book about the 1986 tax overhaul.

But the supply-side theory eventually won out, if in fits and starts. Reagan’s 1981 tax package cut the top individual rate from 70 percent to 50 percent – with the rate getting down all the way to 28 percent in 1986.

Republicans now credit those 1981 tax cuts with sparking years of economic growth, higher wages and job creation. But with the economy floundering in 1982, Dole and other Republicans pushed through a tax increase. And Democrats have long said that there was no trickle in the GOP’s “trickle-down economics,” pointing to a 1990s economic boom that happened after President Bill Clinton raised taxes.

Conservatives believe the growth had more to do with a cut in the capital gains rate under Clinton’s watch, which itself was followed several years later by the two rounds of tax cuts under George W. Bush.

Now, 15 years later, all that work by supply-siders has culminated in a new kind of tax reform, which marries the theory that tax cuts for business will be a boon for the economy with tax reform’s traditional discarding of various tax incentives that have collected over the years, which they say distorts the economy.

Marty Sullivan of Tax Analysts said the 2017 tax overhaul looks more like the 1981 and 2001 tax cuts enacted under Republican presidents, as opposed to tax overhauls in 1969, 1976 and 1986. The 1986 tax reform, while lowering the top corporate rate from 46 percent to 34 percent, actually hiked taxes on corporations to pay for tax relief for individuals, and to keep from adding to deficits.

“Those were all workman-like reforms where the staff and members looked hard for unfair and complicated tax breaks to take out of the code to simplify it, make it fair and reduce rates,” said Sullivan, a former economist for both the Treasury Department and the Joint Committee on Taxation. “In this bill, tax cutting is the primary motivation and reform is an afterthought.”

The next question is whether this bill will jolt the economy like its supporters say. Trump and other top Republicans have said that the economic growth created by the tax cuts will more than offset its current $1.456 trillion price tag.

But while outside analysts and JCT have found that the Republican tax plan would create hundreds of billions of dollars in new revenue, none of them have found that the plan would come close to paying for itself. On top of that, Democrats are already making it clear that they’ll do everything in their power to unwind this year’s tax bill, especially if they win back some power in Washington next year.

“One of the lessons of ‘86 is it’s really hard to get tax reform, but it’s even harder to keep it,” said Douglas Holtz-Eakin, a former Congressional Budget Office director and president of the conservative American Action Forum. “I think it’s a concern. The partisan nature makes it ripe for change the moment the Democrats get the opportunity.”

For their part, conservatives say they’re in better shape than ever to protect the new tax cuts. Republicans were united against former President Barack Obama’s efforts to allow Bush-era rates for the wealthy expire, though they weren’t successful in the end, and Norquist notes that bipartisan efforts that erased parts of the 1986 tax overhaul came before practically all GOP lawmakers were signing his organization’s pledge against tax hikes.

But Moore also called the 2017 tax cuts a “riverboat gamble,” echoing the late Senate Majority Leader Howard Baker’s thoughts on the 1981 Reagan tax cuts. Their success or failure, Moore added, will have a big impact on whether the supply-siders’ influence grows or diminishes over the next generation.

“We say it will work, and they say it won’t and this will be put to the test,” Moore said. “If this doesn’t work, I’ll eat some crow.”

GOP lawmaker: Top FBI officials will be subpoenaed

Jim Jordan is pictured. | Getty Images

“Chairman Goodlatte has told us he is going to subpoena those individuals,” Rep. Jim Jordan (R-Ohio) said.

A Republican on the House judiciary committee said Saturday he’s gotten a commitment from committee chairman Bob Goodlatte (R-Va.) to subpoena top officials at the FBI and Justice Department in their ongoing inquiry into claims of bias against President Donald Trump.

Republicans have zeroed in on deputy FBI director Andrew McCabe, top counterintelligence agent Peter Strzok, FBI attorney Lisa Page, former associate deputy attorney general Bruce Ohr and his wife Nellie, who reportedly worked for Fusion GPS, the firm that compiled opposition research on Trump in 2016.

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“Chairman Goodlatte has told us he is going to subpoena those individuals,” said Rep. Jim Jordan (R-Ohio), in an appearance on Fox News’ “Justice with Judge Jeanine.”

Goodlatte’s office declined comment earlier this week when asked if he was considering issuing subpoenas to those agents.

Republicans have focused on Strzok with greater intensity in recent days, after the Justice Department released a series of text messages he sent to Page in 2016 that showed hostility toward Trump.

Democrats have dismissed the complaints as a sideshow, noting that FBI agents are expressly permitted to have political views, so long as they don’t act on them to taint investigations. So far, they say, no evidence has shown Strzok or Page took any actions based on their dislike of Trump. Their texts also revealed disdain for other political figures on both sides of the aisle.

Strzok was a key figure in the investigation of Hillary Clinton’s private email use and was tapped in the spring to join Special Counsel Robert Mueller’s investigation of Russian meddling in the 2016 presidential election. Mueller dropped him from the probe over the summer after learning of the texts.

The show’s host, Jeanine Pirro, a Trump ally, opened her show with a harsh indictment of the FBI, which she called a “crime family” under the leadership of former FBI director James Comey, who Trump fired in May.

Jordan said Pirro’s opening “was perfect.” He was joined on the show by Rep. Ron DeSantis (R-Fla.), who also suggested he may pursue contempt citations for FBI Director Chris Wray and Deputy Attorney General Rod Rosenstein if they fail to turn over more documents related to their inquiries.

Jordan said the developments in recent weeks prove that top law enforcement agencies were working against Trump’s election.

“President Trump won,” he said, “in spite of the Republican establishment being against him, the Democrats being against him, the elite media being against him and the FBI and Justice Department being against him.”

Trump transition lawyer accuses Mueller of unlawfully obtaining emails

A lawyer for President Donald Trump’s transition team is accusing special counsel Robert Mueller of unlawfully obtaining tens of thousands of private emails during its investigation into Russian meddling in last year’s presidential election.

Kory Langhofer, an Arizona-based attorney representing Trump for America, spelled out the complaint in a seven-page letter sent Saturday to the main House and Senate oversight committees where he raises potential violations of attorney-client privilege and the Fourth Amendment, which protects against unlawful search and seizure.

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Mueller’s office got the records earlier this summer from the General Services Administration, the government agency charged with holding all transition materials, even while it was “aware that the GSA did not own or control the records in question,” Langhofer wrote.

The Trump attorney also argued that Mueller’s office has “extensively used the materials in question” during its investigation even though its prosecutors were aware some of the materials were subject to claims of attorney-client privilege and other protections.

A Mueller spokesman, Peter Carr, declined comment on the letter. A GSA spokesperson could not be immediately reached for comment.

The Trump team’s complaint – which a source close to the transition said it intends to elevate by filing a formal letter to Mueller — is the latest in a series of legal maneuvers seeking to challenge the special counsel’s authority. The effort to rein in the probe is expected to increase as the Russia prosecutors continue their work while they simultaneously prepare for a criminal trial next year against former Trump campaign chairman Paul Manafort and his deputy, Rick Gates.

Several former Justice and national security officials and experts in federal criminal law cast doubt Saturday that the Trump transition team’s complaint amounted to a serious breach.

“I seriously doubt there is anything here to taint the [Mueller] investigation,” said William Jeffress, a white-collar defense attorney who represented Vice President Dick Cheney’s senior aide, I. Lewis “Scooter” Libby, during the Valerie Plame CIA leak investigation. Jeffress added the letter included no evidence to prove any privileged information had been obtained by Mueller’s team and that even if it were, there are procedures for retrieving them.

Democrats and Trump critics erupted after new of the letter broke, warning that the allegations against Mueller smacked of a pretext for Trump firing him. But White House attorney Ty Cobb told POLITICO on Saturday that an ouster isn’t in the offing.

“As the White House has repeatedly and emphatically said for months, there is no consideration at the White House of terminating the special counsel,” Cobb said.

According to Langhofer’s letter, the Trump transition team first learned that the special counsel had obtained the emails from GSA earlier this week. It took those concerns to Brandon Van Grack, a Mueller prosecutor, who confirmed the special counsel’s prosecutors had obtained laptops, cell phones and at least one iPad from GSA.

“But he assured us that the Special Counsel’s investigation did not recover any emails or other relevant data from that hardware,” Langhofer said.

The Trump attorney added that, during the conversation, Van Grack “failed to disclose the critical fact that undercut the importance of his representations, namely, that the Special Counsel’s Office had simultaneously received from the GSA tens of thousands of emails, including a very significant volume of privileged material, and that the Special Counsel’s Office was actively using those materials without any notice to TFA.” Van Grack also declined to identify the 13 transition officials whose materials the special counsel’s office had obtained.

In subsequent conversations, Van Grack declined to spell out what procedures the special counsel’s office had undertaken to protect the transition’s privileged communications and he also acknowledged Mueller hadn’t set up the kinds of ethical reviews required to protect the evidence and “instead simply reviewed the privileged communications contained in the PTT materials,” Langhofer said.

Trump’s transition lawyer also took aim in its letter at GSA, which it accused of “unlawful conduct” that undermines the Presidential Transition Act of 1963, a law that spells out the procedural rules for a change in power from one president to the next.

After learning in March that Russia investigators were seeking its records, Langhofer said he contacted GSA to get assurances that the transition’s lawyers would be the conduit for the materials. Then-GSA General Counsel Richard Beckler in June explained to him that all requests for the transition’s communications would indeed be routed through its lawyers and that GSA would hold all of the material in secure facilities.

But in August, while Beckler was in the hospital and incapacitated, Mueller’s office and FBI agents approached GSA twice for Trump transition materials, Langhofer said. GSA career staff, he added, produced the materials without making exceptions for attorney-client, deliberative process or presidential communications privileges.

Beckler died in September, and career GSA staff didn’t consult or inform his successor of what Langhofer called “the unauthorized production of PTT materials.”

Ken Nahigian, the Trump transition’s executive director, said in an interview that GSA’s decision to share the emails with Mueller’s office would have a long-term detrimental effect for future transitions. “Future transitions will have to re-examine this relationship,” he said. “Justice by any means isn’t justice.”

The latest complaint against Mueller comes amid a barrage of criticism from Trump allies that the special counsel investigation itself is tainted on multiple fronts. Republicans have increasingly urged Trump to fire Mueller regardless of the political consequences – a strategy that White House lawyer Ty Cobb via text message said Saturday isn’t being considered.

“As the White House has repeatedly and emphatically said for months, there is no consideration at the White House of terminating the special counsel,” Cobb wrote.

The special counsel – on the clock since mid-May, though he did inherit more than a year’s worth of FBI investigations related to the election hacking and other lines of inquiry – has already obtained a guilty plea and cooperation from former national security adviser Michael Flynn. That followed criminal indictments against Manafort and Gates on charges that include money laundering and tax evasion. Both men have pleaded not guilty and a trial is expected next year. The special counsel has also obtained a guilty plea from former Trump campaign foreign policy adviser George Papadopoulos for lying to the FBI.

As the Trump transition complaint surfaced Saturday, several Democrats and former Justice officials cautioned that it may be an additional attempt at casting doubt on Mueller’s integrity.

“’Private documents’ on a US Government, public email system? What are they afraid was found? Baloney. This is another attempt to discredit Mueller as his #TrumpRussia probe tightens,” Rep. Eric Swalwell, a California Democrat and member of the House Judiciary and Intelligence panels, posted on Twitter.

Rep. Elijah Cummings, the top Democrat on the House Oversight and Government Reform Committee, questioned why Trump officials would be taking issue with an attempt by GSA to cooperate with investigators.

“Our committee has direct jurisdiction over the Presidential Transition Act, and it simply does not support withholding transition team emails from criminal investigators,” the Maryland Democrat said. “The president’s lawyers have said they want to fully comply with special counsel Mueller’s investigation, so it is odd that they now suggest they would have withheld key documents from federal investigators.”

“Why are Trump’s lawyers upset that Mueller obtained transition emails from a government agency? (Hint: They’re just playing politics, but this is a bad sign for them.),” added former federal prosecutor Renato Mariotti on Twitter.