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Texas Representative Charlie Gonzalez announced his retirement this weekend past. “I’ve been in Congress for 14 years and I want to do something else—what that is, I really don’t know,” the chairman of the Congressional Hispanic Caucus explained. “But financially, I would like to be productive and have the resources to make a better life.”
The second-generation legislator may reconsider should he get his hands on Peter Schweizer’s Throw Them All Out: How Politicians and Their Friends Get Rich Off Insider Stock Tips, Land Deals, and Cronyism That Would Send the Rest of Us to Prison. Schweizer posits that the six-figure congressional salary isn’t the preferred way to get rich in Congress. Instead, unscrupulous legislators profit over inside, investment-guiding information about imminent policy shifts, land development, and corporate favoritism. As the author bluntly notes, “U.S. public policy is a marketable commodity.”
It’s a commodity marketed by everyone from former Democrat House Speaker Nancy Pelosi to former Republican House Speaker Dennis Hastert. And when not marketed in the uncouth manner of Randy “gold-plated-toilet-seat” Cunningham or William “cash-in-the-freezer” Jefferson, it’s perfectly legal. “Politicians are often extraordinarily good investors—too good to be true,” Schweizer writes. “They may not have figured out how to help our economy prosper, but the Permanent Political Class is itself prosperous to a degree that should make us all suspicious.”
Take, for example, Massachusetts Senator John Kerry. Schweizer contends that the richest senator has made himself richer through his office. His stock transactions showan uncanny knack for anticipating coming legislation. When pharmaceuticals stood to gain through the prescription drug plan, for instance, Kerry’s portfolio loaded up on them. “By far the most aggressive congressional trading of pharma stock during the debate was done by Senator John Kerry and his wife,” Schweizer observes. “Oversight of the prescription plan would fall to Kerry’s committee in the Senate, so he was intimately familiar with the law and its ramifications.” When medical-device manufacturers stood to lose through ObamaCare, Kerry’s portfolio dumped them.
But the politicians’ profits prove a pittance next to the take of the moneymen who bankroll their campaigns. Obama supporter Warren Buffet demonstrates that investments in candidates and lobbying are money well spent. Schweizer details the Oracle of Omaha’s intense advocacy of the Troubled Asset Relief Program (TARP), which meant a financial windfall for his private holdings. “Berkshire Hathaway firms received $95 billion in bailout cash,” Schweizer points out, with TARP-bailed out companies comprising a full 30 percent of Buffet’s stock portfolio. His subsequent profits in just one company, Goldman Sachs, peaked at $3.7 billion. “Warren Buffet is a financial genius,” the author quips. “But even more important for his portfolio, he’s a political genius.”
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