Person with no family money, no spousal family money, no high-paying job, etc. gets elected to Congress and collects a Congressman’s salary. A decade or three later is a multimillionaire.
Question comes up about how this degree of wealth was earned. Obvious answer, is bribery, insider trading, kickbacks, etc. Since that’s not the answer usually given by the pol, how do they explain their accumulation of wealth? Or do they simply say “None of your B-I bizniss?”
It’s the business of the IRS for sure where that income came from.
I work in government (not an elected official, just a minion) and we have conflict of interest rules. But even at my job if I did a favor for someone (let’s say I wasn’t breaking any rules but it was within my discretion how to handle them) I could wait 2 years after leaving my agency and legally get a job from them. (I don’t have a job that does any regulation over anyone so there are few situations where I’d even have a potential COI but that’s not the case for most of my coworkers.)
So if a politician made some effort to push forward legislation that eased regulation on an industry, and a few years after they left office they got a lucrative “do nothing” job working in that industry, at least by the rules at my agency (which I think are pretty standard rules used in many places) that sort of thing would be okay.
Now, morally it’s another story. I personally despise lobbying and the way corporations get their ties into politicians. It’s a bipartisan issue (one of those rare areas where “bothsideism” is reality) and I’m not sure how to fix it.
Realistically, if you can mooch off lobbyists, go to enough organized lunches for the party, etc. live in your office, and use the Congressional lockers for showering and such, then you’re effectively living for free or very little.
Invest everything you have and earn into Amazon, wait ten years, and you may well be doing fairly well. If you have thirty years and you’ve been investing the majority of your salary, you should be well into the millions of dollars.
There’s not enough details in the scenario. For instance, if a politician makes a bunch of money from writing a book, they can point to that.
I think you’re dramatically overestimating the frequency with which this occurs.
Good point. People with no money generally can’t afford to campaign successfully and be elected to Congress. That’s not the entry level point for a person, financially. It’s not impossible but it’d be really hard.
Yeah people with no money are the exception in Congress. Right wingers often point to Nancy Pelosi- how could she be so rich? Well, her husband is in the real estate business in San Francisco, that’s how. They’re generally either already wealthy or married to wealth to start with. If a poor person went to Congress and became rich- that would be news. If it has happened, I’d like to know about it.
Bernie Sanders might the closest thing I can think of. Though I don’t think he was “poor” before Congress; he was mayor of Burlington, Vermont and ran a small business. He is now worth anywhere from $2.5-3 million, but that is primarily though book sales. He reportedly wasn’t wealthy before joining the House of Representatives in 1991 (he’s now in the Senate) and now he is, so…?
That being said, I’m no Bernie Bro but he’s probably not the best example of what the OP is talking about.
Yeah, it is not common for a person elected to Congress or the Senate to be “working class” or even “middle / upper middle class”, most are actually rich. That doesn’t mean $50m in the bank rich, but it might mean “partner in a successful law firm, $850k paid for house, few million in stocks and bonds, few million in other assets” wealth at age ~45, which is well ahead of the upper middle-class clip. Someone who goes into Congress with say $5-8m in assets, just passively invested in index funds, plus their congressional salary, who then serves for 20-30 years will absolutely be worth somewhere in the $15-30m range without it being too hard, starting from that base of $5-8m and enjoying market rate returns for a couple decades has you looking pretty good.
Bernie Sanders, and there are a couple congressmen / Senators who have a similar financial background to him, is a not-uncommon situation. Joe Biden actually had a similar wealth situation to Bernie until he became Vice President. The baseline pay is generally not terrible, and the benefits are really good. The cost of housing in DC is high, but if someone had a 25-30 year career, there were more options for cheap residences in and around the District back then, and if they bought one, they would also have benefitted from the high appreciation of District-area real estate. Biden famously commuted on the train from his house in Delaware to DC every day.
Someone in that Bernie or Biden income range, put a few decades in Congress in and they are going to naturally be worth millions of dollars. Congress has a pretty good 401k style savings program that if they are smart at all they participate in, and a lot of that is just passively getting market returns (they are in the Federal Thrift Saving Plan–they also have traditional defined benefit pension plans.)
Now, if someone then becomes “genuinely famous” that money is likely to increase rapidly. Often times when “people of a certain persuasion” are wanting to make a “point” about a politician who has x amount of money despite “only ever working” as a civil servant, frequently miss this point. Take three prominent Democrat examples: Barack Obama, Bernie Sanders and Joe Biden.
Both eventually emerged onto the national stage, this enabled them to be able to sign lucrative book deals. There is nothing against Congressional rules in publishing a book and collecting the earnings from it. Barack had a famous, New York Times bestseller before his Presidency. Bernie between 2009 and 2018 earned around $5m, $2.5m was from a book deal that he obtained after his 2016 primary performance and emergence on the national stage–around $2.1m was from…salary, highlighting that their salary does add up.
Biden didn’t really cash in until after his Vice Presidency–that’s when he got his first and only lucrative book deal, and started being able to command six-figure per appearance speaking fees. Barack Obama despite being quite comfortable from his book from before his Presidency, rocketed upwards of $100m in wealth after his Presidency primarily through book and other media deals. He reportedly got around a $65m advance on his big post-Presidential book, and a $50m Netflix deal. Unlike infamous figures Bill Clinton and Hillary Clinton, Barack has not nearly embraced the paid speaking circuit to the same degree (very likely because of the political baggage it has attached to the Clintons.) That is not to say Barack has not done paid speeches, just that he hasn’t gone at it hard in the paint like the Clintons did, Bill and Hillary essentially made doing those speeches a full-time job (Bill after the Presidency, Hillary in the period between her time in government and the 2016 campaign), they were regularly doing like 150-200 paid speech appearances a year, and clearing tens of millions of dollars a year in speaking fees. However Obama has been much more limited in speaking engagements–he has tended to make even more per speech than the Clintons, sometimes reportedly upwards of $650,000 per speech.
If you’re Lyndon Johnson, you point out that all the money is in your wife’s name and she just happens to have a fantastic knack for business.
IME this accusation is sometimes made by people low enough in income that they can’t grasp the distinction between the upper middle class income of a congress critter (which, as has been pointed out here, is perfectly adequate to result in a 2 or 3 million dollar net worth over decades in office) and 99%-percentile income (or corruption) which gives you tens of millions overnight. It reminds me of the kids on the Simpsons who conclude, after learning that their principal earns $25,000/year and is 41 years old, “is a millionaire!”.
I’m sure everyone who looked into it for a few minutes could come up with one relatively “poor” candidate for office who collects a Congressperson’s salary for a few decades and somehow, without benefit of marriage to a wealthy person or a lucrative book deal, ends up with more money in the bank than the total of their combined salary for the entire time they served in office.
And if you thought about it for a bit longer you could come up with a dozen pols whose wealth is almost as startling as your most extreme example. Are you really telling me that “This never happens” as a response to my question? My impression is that it does happen, and that the IRS and FBI don’t want to look into it very deeply when it does.
Take LBJ. It always struck me as absurd that Lady Bird was a genius businesswoman and that I (or any ordinary citizen) wouldn’t be taken seriously for a moment if I tried “Oh, that’s all my wife, and she’s both very good at running radio networks, a complete lack of experience in the field notwithstanding, and extremely lucky in buying radio stations cheaply that just happen to multiply quickly in value after she purchased them with zero money and involvement from me” as my explanation. Actually, LBJ is a great example of someone who didn’t have two nickels to rub together, and who never collected a penny outside his government salary.
Your mention of the lack of IRS/FBI scrutiny warrants mention of the fact that members of Congress used to be exempt from many of the restrictions on trading on their insider knowledge. AIUI that was changed fairly recently, but many corrupt fortunes were indeed possible, and legal.
So the accusations of long-time members of Congress are sometimes valid (even if many of them fall apart upon closer examination).
But (again AIUI) the law has been changed to prevent future instances, so the response to accusations followed by, “There ought to be a law!” should be answered, “There is”. Not sure about the president and vice-president–IIRC they are still exempt.
As a retired civil servant, it galls me when people lump us in with members of Congress as having been similarly exempted (not that anyone in this thread has done this). It’s always been illegal for us lesser government employees to trade on insider knowledge, and the oversight tightened dramatically over the course of my career.
The FBI arrests members of Congress fairly regularly, year in and out:
It should also be noted that the R vs D ratio is pretty much even. Any idea that the FBI is politically biased against or for a particular party doesn’t seem to be born out by their actions.
Then I think you should do that. You presented the claim. You present the evidence. I think you should also show that this wealth didn’t result from being frugal and investing their savings wisely over these “few decades”.
Thanks for the invitation, which I will decline.
I’ve already noted the near-perfect example of LBJ, which someone else supplied, and my contention that I do not believe that LBJ was a fluke among Congresspeople/Senators in amassing great wealth on a (rather stingy, in his days as a Congressman) government salary.
It was suggested that LBJ attributed his wealth to wise investments on his wife’s part, which is an absurd claim on several grounds that I do not believe would pass muster with the IRS for you or for me. The fact that he had inside information, for example, ought to have been a screaming fire alarm, and it almost certainly was, except that the IRS chose to plug up their ears.
So that’s one answer to my OP: claim it’s your spouse’s legit earnings (which ordinarily would get investigated). Any other suggestions for pols’ responses to charges of corruption?
If that was the law at that point in time then open or plugged, the IRS had no law to charge the person with.
At the moment in time in which you and I live, Richard Burr was investigated for participating in a hearing on Covid in early '19 and selling out his position on the stock market. That seems sufficiently strict to me.
“The law is a net in which the little flies get caught and the big flies go free.” Balzac.
But since Balzac lived before our time, I suppose this axiom is no longer true.
Depends on exactly what you mean by “multimillionaire” and “worth”. If you are talking about “2 million dollars or more net worth”, that might not be so difficult depending on the where the Congressperson is from. For example, I live in NYC and my husband and I currently have a net worth of about a million dollars - but that includes retirement savings and the house that is worth about four times what we paid for it thirty years ago. If we were to continue working until we were 70 years old or so at our well-but-not-spectacularly high paying jobs ( neither of us makes as much as a Congressperson) , it is entirely possible that we would have a net worth over $2 million.
Yes, and wealth accumulation can kinda follow a hockey stick line on a graph. Once you get past paying for your material lifestyle, wealth begets wealth begets more wealth. So the longer you are at it, the bigger the numbers get. To outsiders like your average working stiff looking at it happen with a politician, it just doesn’t make sense so they naturally suspect nefarious activity.