Indeed, we can now simply call it the Trump-Musk Payments Crisis.
Well, thats not exactly accurate.
The letter expresses significant concerns that FEMA funding is going to entities engaged in or facilitating illegal activities.
President Trump departs from the East Front Steps of the U.S. Capitol in Washington, D.C., on March 12.Annabelle Gordon/Sipa USA/AP Images
DHS/FEMA has a responsibility to ensure that it does not make payments that fund criminal activity.
This justification for denying congressionally appropriated fundsis extremely legally dubious.
This justification for reversing the disbursement of already disbursed funds isfar beyond legally dubious.
It brings up profound and basic issues about the functioning of our society.
Sending this money violated the law and is in gross insubordination to the Presidents executive order.
That money is meant for American disaster relief and instead is being spent on high end hotels for illegals!
A clawback demand will be made today to recoup those funds.
It does not take much of a leap in logic to draw a direct line betweenthis clawbackto Elon Musk.
Social Security payments are ACH payments, as are payments to medical providers.
For older readers, if you look at your checkbook you will see an ACH number on your checks.
Really, it would be easier to list whatarentACH payments than what are.
The rules for ACH are mainly determined by National Automated Clearing House Association (NACHA, now Nacha).
The idea of payment finality is deceptively basic.
What it refers to is the point at which a transaction is concluded by full and satisfactory payment.
Contracts, for example, are a relationship between two parties.
Those parties have a contract relationship for as long as the contract is outstanding.
Money is that object, or system, that you could make final payment with.
Consequently what defined physical objects as currency was that they could be proffered as final payment.
Unfortunately, we no longer live in the world of cash.
We live in the world of accounts.
In the world of accounts, a disturbing question hangs over us: When is a payment truly final?
Or as famous New York philosophers Yogi Berra andLenny Kravitz might say, It aint over til its over.
In other words, we socially and legally construct payment finality as truth.
Yet, the fabric of these social and legal constructions are far more fragile than most people imagine.
Which brings me back to ACH.
Nor can her memo be construed as legal advice.
Exceptions must be reserved for only truly extraordinary cases.
So if the bank-based payment system or payments law does not provide constraints, are there others?
At first glance, it might seem like there are.
Administrative agencies cant just decide to debit accounts.
They have to get payment reversals or separate debit transactions certified at a central point.
Readers of Notes on the Crises or mypreviousRolling Stonearticleare already dreading what they correctly suspect is coming next.
The body that certifies debit transactions is… the Bureau of the Fiscal Service.
A former BFS employee tells me: The circumstances you describe from the FEMA-New York situation sound highly unusual.
Payment finality except in extraordinary and clearly-defined circumstances [is] critical to a functioning and credible payment system.
That last sentence is a key point.
The objection here is not to using any legal mechanism to retrieve an improper payment.
Payments law is a kind of source code for all other parts of law.
Yet, this crisis remains unresolved, because court injunctions move far slower thana fast moving and imperial presidency.
Courts cant unspill spilled milk.
Injunctive relief is OK at stopping things, its far, far worse at stopping things before they happen.
Im having trouble imagining circumstances more dangerous.
