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April 2, 2014

Charles H. Keating Jr., the infamous financier behind the biggest savings and loan disaster of the 1980s, died Tuesday. He was 90.

Keating ran the Phoenix-based American Continental Corp., in addition its subsidiary Lincoln Savings & Loan. Many of the depositors at Lincoln Savings & Loan, especially older savers and naive investors, were persuaded to cash in their federally insured deposits for $256 million worth of uninsured American Continental junk bonds. Keating was convicted in 1993 of swindling those customers and raiding the thrift. The failure of Lincoln Savings & Loan cost the government $3.4 billion.

It also tainted the political careers of the Keating Five — Sens. John McCain (R-Ariz.), John Glenn (D-Ohio), Alan Cranston (D-Calif.), Donald Riegle (D-Mich.), and Dennis DeConcini (D-Ariz.) — all significant recipients of Keating's campaign largesse who lobbied to get federal regulators off his back as Lincoln and American Continental teetered toward insolvency.

Keating's convictions were later overturned, and he pleaded guilty to bankruptcy fraud in Phoenix. He served four-and-a-half years in prison. While Keating is best known for the savings and loan disaster, he garnered attention in other ways earlier in life; he was a college swimming champion at the University of Cincinnati and an anti-pornography activist. Read more at The New York Times. --Catherine Garcia

9:44 a.m. ET

In the summer of 2007, an Alabama man named Kharon Davis was arrested on charges of capital murder and placed in county jail to await trial. He was 22, and his only previous offense was driving without a license.

Today, as The New York Times reported Tuesday in a deep dive into Davis' case and the problem of lengthy pre-trial detention more broadly, Davis is still in that county jail, still awaiting trial. He has now served half Alabama's minimum murder sentence without any conviction.

The causes for this egregious delay are many. Davis himself has exacerbated the situation by replacing his court-appointed legal team, but he is far from holding sole responsibility. One of his defense attorneys, for example, was the father of an officer investigating his case. He filed just two motions on Davis' behalf in the four years it took for the district attorney to suggest a conflict of interest was in play.

"The court has to gain control of the case and not let it petrify," Jonathan Turley, a constitutional law professor at George Washington University, told the Times. "This is like a railroad saying, 'This is an awful train wreck.' Well, the train belongs to the railroad."

For Davis, the Times notes, there finally may be a light at the end of the tunnel: Jury selection for his trial began Monday. Bonnie Kristian

9:21 a.m. ET

Bill O'Reilly insisted he has no regrets about his conduct while at Fox News during a tense interview with Matt Lauer on Today on Tuesday. "Over the last six months since your firing, have you done some soul searching?" Lauer pressed as O'Reilly maintained that the multiple sexual harassment allegations brought against him are completely false. "Have you done some self-reflection? And have you looked at the way you treated women that you think now, or think about differently now, than you did at the time?"

"My conscious is clear," O'Reilly pushed back, calling his ousting a "political and financial hit job."

Lauer continued to press O'Reilly, asking why multiple women would step forward to accuse the star personality of the network and why O'Reilly didn't countersue them if their allegations were so blatantly false. "Every allegation is a conviction," O'Reilly insisted.

"Were there any self-inflicted wounds here, Bill?" Lauer finally asked.

"You know, nobody's a perfect person," O'Reilly replied, "but I can go to sleep at night very well knowing that I never mistreated anyone on my watch in 42 years." Watch the full interview below and read why O'Reilly might be right that Fox News dumped him over the money here at The Week. Jeva Lange

8:35 a.m. ET
Mark Wilson/Getty Images

The Senate approved late Monday a 1,215-page, $700 billion defense policy bill that would give the Pentagon a larger budget than at any time since at least 2001, when the U.S. invaded Afghanistan. The bill now goes to a House-Senate conference committee to work out differences between the House and Senate versions. The Senate's 89-8 vote signifies broad support for raising military spending after years of caps from a bipartisan deal that neither party liked, amid growing threats from North Korea and Sen. John McCain's (R-Ariz.) contention that underfunding training and equipment has contributed to the death or injury of nearly 100 service members in a series of accidents since mid-July.

The defense bill does not close military bases, as Defense Secretary James Mattis had requested, nor would it tackle a series of policy issues like transgender service members or North Korea sanctions, but it does include a government-wide ban on software from Russian cybersecurity firm Kaspersky Labs. The $640 billion for Pentagon operations like buying weapons and paying troops was $37 billion more than President Trump had requested, but the $60 billion for wartime missions in Iraq, Afghanistan, Syria, and elsewhere was $5 billion less. Peter Weber

8:20 a.m. ET
Joe Raedle/Getty Images

As Republican senators gear up for a last-ditch attempt at repealing ObamaCare, Sen. John Kennedy (R-La.) wants to confirm that the GOP bill can't be used by states to set up single-payer health-care systems, The Washington Examiner reports. "I don't think states should have the authority to take money from the American taxpayer and set up a single-payer system," Kennedy said. "Some people think that's inconsistent with the idea of flexibility, but that's what the United States Congress is for. I very much believe in flexibility, and I know governors want flexibility, but it's our job to make sure that money is properly spent."

The health-care bill, which was introduced by Sens. Lindsey Graham (R-S.C.) and Bill Cassidy (R-La.), would effectively replace much of ObamaCare with state block grants and phase out Medicaid expansion. Kennedy insisted an amendment would be needed because "if you give a big chunk of money to California they're going to go set up a single-payer system run by the state and then come back and say, 'We don't have enough money, we need more.'"

"I think a single-payer system is a bad idea," Kennedy said.

As one of the bill's authors, Graham said he was doubtful states would be able to use the legislation to create their own universal health-care plans due to the complications of federal labor laws, The Washington Examiner reports. But "if California wants to go down the single-payer road, knock yourself out," Graham told Breitbart. Jeva Lange

7:51 a.m. ET

President Trump's former deputy assistant, Sebastian Gorka, was ousted last month shortly after Gorka's "economic nationalist" ally, Stephen Bannon, was also given the boot. Like many recent departures from the White House, Gorka apparently signed on to help Trump from the outside with his new job, serving as chief strategist of the "MAGA Coalition," Axios reports. Only, the MAGA Coalition's first mission is to get a Senate candidate elected who is running against a candidate endorsed by Trump.

In the announcement of Gorka's addition to the MAGA Coalition, the group quoted Gorka slamming "D.C. swamp-dwellers [who think] they know better than the people they represent."

The tension boils down to the Senate race in Alabama, where the anti-establishment Bannon-backed candidate Roy Moore is taking on incumbent Sen. Luther Strange (R-Ala.), who is supported by Senate Majority Leader Mitch McConnell (R-Ky.) and Trump. As part of his work with the MAGA Coalition, Gorka and Sarah Palin plan to host a rally Thursday night in support of Moore, while Trump is expected to hold a rally on Saturday for Strange.

Moore leads Strange by as much as 13 points in polls, with the election set for next Tuesday, Axios reports. Jeva Lange

6:42 a.m. ET
Jeff Vinnick/Getty Images

Donald Trump Jr., President Trump's eldest son and the acting head of the family real estate and branding company, has decided to voluntarily drop his Secret Service detail, telling friends he wants more privacy, several people familiar with the decision tell The Washington Post and USA Today. The Secret Service stopped protecting the younger Trump last week, The New York Times reports, though it's not clear if his wife and five children are still being protected. The Secret Service said it does not comment on who it is protecting out of safety considerations.

The Secret Service is obligated to protect the president and his family, but not top aides, and senior counselor Kellyanne Conway's detail is being dropped, too, the Times report. Conway was originally placed under Secret Service protection because she received threats early on in her tenure, but "that threat assessment has since changed," the Times says, citing a senior administration official. Protecting at least two fewer people should ease the financial and human strain on the Secret Service, especially since Don Trump Jr. travels extensively for business and leisure. The Secret Service will continue to protect the president and his other children and grandchildren, several top aides, and Trump Tower, his primary residence. Peter Weber

6:04 a.m. ET
Bennett Raglin/Getty Images/Toys 'R' Us

On Monday night, Toys 'R' Us announced that it is following Kay Bee Toys and FAO Schwartz into bankruptcy court, but said that unlike its onetime rivals, it hopes to emerge intact. The company, struggling with $5 billion in long-term debt and competition from online retailers like Amazon and discount stores like Walmart, filed for Chapter 11 protection in U.S. federal court, plus the Canadian equivalent for its Canadian operations. It emphasized that all of its brick-and-mortar and online stores will remain open through the crucial holiday shopping seasons, and said its 810 stores and 255 licensed outlets outside North America will be unaffected by the bankruptcy reorganization.

"The company's approximately 1,600 Toys 'R' Us and Babies 'R' Us stores around the world — the vast majority of which are profitable — are continuing to operate as usual," Toys 'R' Us said in a statement. It did not say what will happen to its 65,000 employees worldwide or its retail stores, but some of its 885 U.S. locations are expected to be closed in the reorganization. Peter Weber

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