Money Power Runs America: Center for
Responsive Politics (CRP) Report
17 December 2011
By Stephen Lendman
Wall Street does it by controlling money, credit and
debt, as well as manipulating markets for private
enrichment. House and Senate millionaires do it their
way for greater wealth, privilege, power and status.
New Center for Responsive Politics (CRP) figures show
it. More on them below. New York Times writer Eric
Lichtblau commented in his article headlined,
"Economic Downturn Took a Detour at Capitol Hill,"
saying:
In 1991, Representative Ed Pastor (D. AR) entered
Congress with around $100,000 in savings and as much
debt owed banks. Now he's a millionaire, one of 250 in
Congress.
"(A)nd the wealth gap between lawmakers and their
constituents appears to be growing quickly" as
austerity cuts harm most Americans needing help during
harder than ever hard times.
Since 2008, they've lost jobs, homes, personal
savings, and futures. At the same time, congressional
members are richer than ever. Perhaps never "has the
divide (been) so wide, or the public contrast so
stark, between lawmakers and those they represent."
No wonder Gallop's year end poll showed Congress
getting its lowest ever 11% approval rating. At the
same time, growing numbers of Americans reject both
parties for independent or unaffiliated status.
On November 14, the Atlantic Wire headlined, "How
Members of Congress Get Rich Through 'Honest Graft,'"
saying:
"A 60 Minutes report examined the ways members of
Congress trade on inside, privileged information" to
get rich. "Congresspeople are exempt from insider
trading rules" so profit in ways others can't legally.
They do it through stock trades and privileged
business deals. Former House Speaker Dennis Hastert
earmarked funding for a federal highway project on
land he owned. He later sold it for $2 million.
Former Speaker Nancy Pelosi profited from eight IPOs,
including some "that had business before her House."
So have other congressional members, past and present.
Former Senator Bob Dole bought shares in Automatic
Data Processing four days before GHW Bush signed
legislation with new military data processing rules
benefitting the company handsomely.
Former Speaker and Republican presidential aspirant
Newt Gingrich bought Boeing stock just before he
helped kill amendments to cut International Space
Station funding. It helped Boeing secure a lucrative
contract.
Numerous others in Congress profit the same way. Some
hit the jackpot. In 2004, the Journal of Financial and
Quantitative Analysis published a report showing
Senate portfolios outperformed the market by about 12%
annually. It didn't happen by chance.
A 2011 study showed House member investments exceed
market performance by 6%. Do it annually and it adds
up. For example, $100 invested at 6% for 40 years
grows tenfold. At 12%, it's 80-fold.
Washington runs on inside information. Congressional
members use it to get rich. While their median net
worth gained 15% from 2004 to 2010, America's 10%
richest found theirs unchanged, and for Americans
overall, it dropped based on inflation-adjusted
dollars.
Of course, America's top 1% outdid them all. Why else
would nationwide protests target them for social
justice.
Notably, congressional wealth grew two and a half
times (from $280,000 to $725,000) from 1984 to 2009 in
inflation-adjusted dollars, while for average
Americans it declined slightly. Moreover, for the past
half century, income inequality mostly benefits
congressional conservatives. Progressivism pays
poorly.
In 1984, one in five House members had zero or
negative net worth, excluding home equity and other
non-income producing property. By 2009, it dropped to
one in 12.
As a result, the gap between congressional members and
their constituents perhaps never has been so wide.
Moreover, it increases annually at a time Main
Street's suffering harder than ever hard times, and
few in Washington care.
Center for Responsive Politics (CRP)
Report
It began saying:
"These days, being a millionaire (puts you in) the
(top) one percent. But in Congress, it only makes you
average."
Among 535 House and Senate members, 250 (or 47%) are
millionaires, based on 2010 financial disclosure
forms. Only America's top 1% enjoys that status.
According to CRP's executive director Sheila Krumholz:
"The vast majority of members of Congress are quite
comfortable financially, while many of their own
constituents suffer from economic hardship."
It's largely from decades of destructive bipartisan
policies. Since the 1980s, economic inequality grew
enormously. Business and super-rich elites profited
handsomely at the expense of working class people.
Wealth disparity is unprecedented at a time nearly 23%
of Americans are unemployed. Half of US households are
impoverished or bordering on it. Millions lost homes,
and growing hunger and homelessness threaten millions
more.
In contrast, congressional members never had it so
good. "It's no surprise that so many people grumble
about lawmakers being out-of-touch," said Krumholz.
"Few Americans enjoy the same financial cushion
maintained by most members of Congress - or the same
access to market-altering information that could yield
personal financial gains."
Moreover, congressional pay, benefits and perks alone
are generous. In 2011, rank and file House and Senate
members earned $174,000. According to US Census data,
median 2010 household income is $48,753.
In February 2011, the Congressional Research Service
reported the following legislative, executive and
judicial salaries:
President: $400,000
Vice President: $230,700
House Speaker: $223,500
Senate President Pro Tempore: $193,400
House and Senate Majority and Minority leaders:
$193,400
Senators and Representatives: $174,000
Supreme Court Chief Justice: $223,500
Associate Justices: $213,900
Federal Court of Appeals Judges: $184,500
Federal District Court Judges: $174,000
Moreover, generous benefits and allowances are
provided, including lucrative pensions based on years
of service, peak salary levels, an accrual rate, and
whether members are covered under the Civil Service
Retirement System (CSRS) and/or the Federal Employees
Retirement System (FERS).
For example, a House or Senate member retiring in
December 2010 with 32 years of service averaged
$92,251 in annual pensions supplemented by cost of
living increases. Most members have shorter tenures
and get less. By law, pensions can't exceed 80% of
final year of service pay.
In 2006, retired members covered by CSRS got average
pensions of $60,972. Those retiring under FERS, or in
combination with CSRS, averaged $35,952.
Historically, it was much different. From 1789 to
1815, congressional members got $6 per day while
Congress was in session. From 1815 to 1817, they
earned $1,500 annually. From 1818 - 1855, they got $8
a day.
Thereafter, they got $3,000 annual salaries. In 1907,
it was raised to $7,500. In 2006, they earned
$165,000. Leaders got more. Today, congressional
members profit handsomely from pay, benefits, perks,
and investment returns based on inside information.
For example, 2010 US household median net worth is
$120,000. For congressional members, it's $912,000. In
2009, 7.8 million households had net worths of $1
million or more, around 2.5% of all households. In
contrast, 47% of congressional members are
millionaires.
The top 10 include:
Rep. Darrell Issa (R. CA): an estimated $451.1 million
net worth
Rep. Jane Harman (D. CA): $435.4 million
Rep. Vern Buchanan (R. FL): $366.2 million
Senator John Kerry (D. MA): $249.9 million
Rep. Jared Polis (D. CO): $285.1 million
Senator Mark Warner (D. VA): $283.1 million
Senator Herb Kohl (D. WI): $231.2 million
Rep. Michael McCaul (R. TX): $201.5 million
Senator Jay Rockefeller (D. W VA): $136.2 million
Senator Dianne Feinstein (D. CA): $108.1 million
Combined net worth: $2.8 billion
All support lower corporate, capital gains, and top
bracket personal tax rates. They also back austerity
cuts for ordinary Americans, including lower Medicare
and Medicaid benefits.
Median US senator net worth is $2.63 million - 16%
higher than 2008. In 2010, 37 Senate Democrats and 30
Republican counterparts had average net worths
exceeding $1 million. So did 110 House Republicans and
73 Democrats.
In 2010, median Republican House member net worth
stood at $834,250. For Democrats it was $635,000 for
an average $756,765 - 17% higher than 2008.
By law, all House and Senate members must report their
own holdings and that of spouses and dependents
annually. However, precise investment values can't be
determined so estimates are made. They exclude
non-income generating personal property (including
homes, cars, artwork, etc.) and pension benefit
values.
Moreover, the top spousal bracket is "more than $1
million," so true net worth amounts for many lawmakers
"are likely undervalued." For example, some believe
John Kerry's wife Teresa Heinz's net worth exceeds $1
billion. As the Heinz heiress, it's likely more.
A Final Comment
At a time class war in America rages, growing human
need goes unaddressed, Washington is corporate
occupied territory, and endless imperial wars ravage
the world one country at a time with more planned,
congressional members never had it so good.
No wonder fed up Americans want long denied social
justice, and Occupy Wall Street calls "world
revolution" the "only solution."
Change never comes top down, only bottom up. Society's
privileged with power never yield it. Pressure's
building to force them. Human need's too great and
worsening. When pain levels cross a threshold of no
return, all bets are off. Or as Gerald Celente says:
"When people lose everything and have nothing else to
lose, they lose it."
That moment of truth draws closer, and not just in
America.
Stephen Lendman lives in Chicago and can be reached
at lendmanstephen@sbcglobal.net. Also visit his blog
site at sjlendman.blogspot.com and listen to
cutting-edge discussions with distinguished guests on
the Progressive Radio News Hour on the Progressive
Radio Network Thursdays at 10AM US Central time and
Saturdays and Sundays at noon. All programs are
archived for easy listening.
http://www.progressiveradionetwork.com/the-progressive-news-hour/.
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