FP: The public tends to believe the propaganda that there is a difference between Republicans and Democrats. Where it counts there isn’t. Corruption and kleptocracy characterizes both of them.
As the final version of the drug program neared approval—one that didn’t include limits on the price of drugs—brokers for Kerry and his wife were busy trading in Big Pharma. Schweizer found that they completed 111 stock transactions of pharmaceutical companies in 2003, 103 of which were buys.
“They were all great picks,” Schweizer notes. The Kerrys’ capital gains on the transactions were at least $500,000, and as high as $2 million (such information is necessarily imprecise, as the disclosure rules allow members to report their gains in wide ranges). It was instructive to Schweizer that Kerry didn’t try to shape legislation to benefit his portfolio; the apparent key to success was the shaping of trades that anticipated the effect of government policy.
The Kerry trustees’ impeccable timing in drug company trades was evident again in 2007, when the federal government was weighing whether to discontinue Medicare reimbursement for certain anemia drugs used by cancer patients. When the government announced that it would limit reimbursements, shares in Amgen, one of the drugmakers at issue, dropped 15 percent. Kerry’s wife happened to be an Amgen stockholder but avoided losses; her shares, valued at between $500,000 and $1 million, were unloaded more than a week before the government’s announcement.
There is probably no group of people on earth with greater access to inside information than members of Congress; K Street lobbying firms get rich fees from hedge funds for ferreting out intelligence (such as whether some pending legislation has the votes to pass) that any member of the Senate or House routinely obtains in the cloak room.
Pelosi’s office might have added that there was nothing illegal in the Visa trades, nor even a violation of House rules. But that is the point of Schweizer’s book. Indeed, none of the special dealing in his study—which also looks at land deals and the cronyism associated with the green-energy loan controversies, such as Solyndra—is technically illegal. “They have legislated themselves as untouchable as a political class,” he writes.
Washington does seem to live by its own laws of economics. The D.C. metro area has displaced Silicon Valley as home of the highest median income, at $84,523 last year (compared with the national average of $50,046). Earlier this month, a Roll Call study of congressional financial disclosures revealed that the net worth of members of Congress had grown by 25 percent since 2008, during a period in which the average American household has lost as much as 20 percent of its net worth.
“I was troubled,” he says, “by the fact that the political elite gets to play by a different set of rules than the rest of us. In the process of researching this book, I came to the conclusion that political party and political philosophy matter a lot less than we think. Washington is a company town, and politics is a business. People wonder why we don’t get more change in Washington, and the reason is that the permanent political class is very comfortable. Business is good.”