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Your last paragraph is closer to accurate, except a president doesn't just "appoint" a judge. They have to be voted in by the senate. So, if the president is a crook and nominates a crook and the senate is full of crooks and vote yes to have said crook become a judge, then yes really bad stuff can happen. But if the president is a crook and the majority of the senate are crooks, it's already all over.