Stack the Week

Welcome everyone to the Stack the Week experiment for May 18th through the 22nd. It is available here in text and audio and available in your podcast player.

Thank you to Annie Cohen and Laura Doan for help preparing this delicious offering.

The president settled a lawsuit with himself, and his party started to notice. The cycle of threats and pauses in Iran continued as did the decline in the mood in the US. AI showed up everywhere — in commencement boos, papal encyclicals, and mass layoffs at companies reporting record profits. And deep in the ocean, scientists kept finding creatures that have been quietly outlasting every catastrophe on Earth for 400 million years. But let’s see if they can handle Colbert leaving.

Let’s take it day by day.

Monday May 18

Strike out in Iran, Trump settles with himself, Musk is unsettled, rioters smell a payout, Iran mulls taxing the internet.

Iran

It has been hard to keep up with the strikes threatened and called off in the Iran war, so you could be forgiven the confusion. Monday night President Trump posted that he’d called off the strike against Iran scheduled for Tuesday. He credited Saudi and Qatari leaders — both facing economic pain from the Strait closure and exposed to Iranian reprisal if bombing starts again — with brokering last-minute talks. Despite the delay the president said “The clock is ticking.”

The pattern is now familiar enough to chart. Announce escalation. Accept intervention. Claim the intervention proves leverage. Repeat. The question each cycle is whether the pause reflects a genuine diplomatic opening or just a longer fuse on the same bomb.

In Tehran, the Iranian President did something Iranian leaders almost never do: he admitted the damage. Speaking at a public event, he acknowledged deep infrastructure destruction from U.S. and Israeli strikes, crippling fuel shortages — gasoline production has dropped to 100 million liters against 150 million liters of daily demand — and severe economic strain. He pushed back explicitly against hardliners who want to walk away from negotiations. “It is not logical to say we will not negotiate,” he said — a sentence that only needs saying when a significant faction believes the opposite.

That faction answered immediately. Former IRGC commander Mohammad Ali Jafari said publicly that talks should stop unless the U.S. makes major concessions first. The internal fight Pezeshkian was describing — whether to negotiate from weakness or refuse from pride — is the same split that blew up the Iranian delegation in Islamabad weeks ago, when Pakistani hosts spent more time separating Iranians from each other than from the Americans.

Meanwhile, Iran’s Supreme National Security Council launched a new body it calls the “Persian Gulf Strait Authority,” declaring that any vessel transiting the Strait of Hormuz without explicit permission will be treated as illegal. The move formalizes what has been happening in practice for weeks — Iran claiming sovereignty over the chokepoint.

More quietly, and potentially more consequentially, Iranian lawmakers and state media floated plans to impose licensing fees on the undersea fiber-optic cables that cross the strait. Roughly a quarter of the internet traffic connecting Europe to Asia runs through those waters. Regulating the cables wouldn’t require a single missile — just a licensing regime and the implied threat that noncompliance could mean a cut line.

On the water itself, the blockade grinds on. CENTCOM reported it has now redirected 85 commercial vessels and disabled four since enforcement began.

Donald Trump won the presidency in part by saying that George W. Bush had made a mistake invading Iraq. Now voters think that of him. On the 73rd day of the war, a New York Times poll found nearly two-thirds of voters said going to war had been the wrong decision, including almost three-quarters of independents. Over the weekend, an Economist/YouGov poll showed only 28 percent of Americans support the war, down from the previous week.

Trump’s approval rating in the NYT poll sat at 37 percent. Historically, when a president is below 50 percent, his party loses an average of 33 House seats.

Trump drops IRS lawsuit

One of Donald Trump’s first acts in his second term was to pardon the men and women who had been convicted by juries in connection with their effort to overturn the will of 81 million Americans by attacking the Capitol on January 6th. Since then, he has expanded his efforts to reward those involved, blending their grievances with his own legal battles. There are a lot of benefits to being in the January 6th club.

The latest boon comes via a highly unusual legal settlement. Trump had filed a $10 billion lawsuit against the IRS over the 2019 leak of his tax returns by contractor Charles Littlejohn, who was sentenced to five years in prison in 2024. Because Trump filed the lawsuit and controls the IRS, this was a settlement in the sense that shaking your own hand is an agreement.

Career lawyers in the IRS’s chief counsel office prepared a 25-page memo recommending the DOJ move to dismiss the suit, identifying several flaws — including that Trump may have filed too late, since his personal lawyer Alina Habba attended the Littlejohn guilty plea in October 2023, more than two years before he sued. The DOJ never used the memo.

Trump had reason to move fast. Federal Judge Kathleen Williams had already questioned whether the two sides were “sufficiently adverse” and scheduled a May 27 hearing on whether to toss the case entirely.

In lieu of damages, the Justice Department announced the creation of a $1.776 billion “Anti-Weaponization Fund” — the figure a nod to the founding year — intended to compensate Trump allies, including January 6th defendants, who claim they were mistreated by the Biden-era DOJ. The money comes from the Judgment Fund, a permanent, uncapped appropriation the DOJ can tap to settle cases without congressional approval. Trump appoints the five-member commission that distributes the money and can fire any of them.

The DOJ cited as precedent Obama’s Keepseagle settlement for Native American farmers, but that case dragged on for over a decade, went through a judge, and compensated documented claimants — not a dispute that started and ended in under four months without the government ever mounting a defense.

Brian Morrissey, the Treasury Department’s own Trump-appointed general counsel, resigned the day the fund was announced.

Peter Keisler, who served as acting attorney general under George W. Bush: “This is not an authentic settlement of the IRS case.”

The original 2020 New York Times reporting on the leaked returns revealed that Trump paid just $750 in federal income tax the year he entered the White House, frequently wiping out his tax liability through chronic, colossal business losses.

Writing in the National Review, Dan McLaughlin called the arrangement what it looks like: “a collusive operation to create a slush fund to pay off friends and political allies. And in doing so, it expends nearly $2 billion in taxpayer money that Congress never appropriated.”

The fund fits a pattern. Trump has used the power of his office to extract $60 million total from Meta, Alphabet, and X; $16 million each from Paramount and ABC. He previously demanded $230 million from the DOJ itself for past investigations into his conduct. As The Atlantic noted, no modern president has monetized grievance at this scale.

Musk loses in Open AI suit

Elon Musk, a man who fired thousands of federal workers with zero concern for timing, lost his biggest lawsuit on Monday because he didn’t file on time. The jury deliberated for less than two hours. Due diligence and deadlines turn out to matter—whether you’re cleaning out someone else’s desk or trying to protect what was on yours.

The federal jury and a judge ruled Musk waited too long to bring his claims against the AI startup and its top executives, Sam Altman and Greg Brockman. Because the jury found the case wasn’t filed on time, it didn’t weigh in on Musk’s three claims, including breach of charitable trust, unjust enrichment, and, against Microsoft, aiding and abetting.

However, he still succeeded in wasting his competition’s time and during his cross-examination of Altman, Musk’s lawyer cited comments from eight witnesses, including Musk, who said Altman misled or lied to others.

“This verdict removes the single largest legal threat to a public ⁠offering,” said James Rubinowitz, a trial lawyer and AI specialist quoted by Bloomberg. “Even in victory, OpenAI walks away with the worst documentary evidence about its governance now permanently in the public record. Every institutional investor reading this trial transcript is doing their own credibility analysis on Altman before they buy in.”

According to Axios: Public trust in AI is nosediving. Public approval of AI now trails that of both the war in Iran and Immigration and Customs Enforcement.

145,000 children separated

Every parent who has lost sight of a child in a grocery store for 30 seconds knows the visceral panic. A new report suggests the American government is inflicting that exact trauma on a scale never before seen.

Is that too dramatic a way to start this item? Does it load the scales against the kinds of tough eventualities that come from carrying out poli