Monday, November 14, 2011

$175,000 a year is not enough. Politicians fight for a job that only pays $175,000 a year so that they can vote and get insider trading tips and become instant millionaires on tips that would be illegal for you and me. The laws they pass make them exempt from all laws involving insider trading. Give me a political job please, I’m ready to make money fast.
On November 9th I wrote about the presidents and senators that benefit from government jobs with lobbyists bribes now called fundraising donations . Well. Being a congressman or Senator gets you a lot of stock information first or you can vote and know the outcome of a situation first and benefit from it.
The next National election is now less than a year away. Congressmen and senators are now spending most of their time at fundraisers trying to raise the millions of dollars they will need to promote their re-election campaigns. They have no time to do their already elected jobs and get something done for this country. Few of them are doing this effort for their salary. They are doing it for the power, prestige and the opportunity to become a Washington insider with access to information and connections that no one else has.
Instead of serving the people of America, they have become the elite society that we vote on with their expensive suits and 5 star lifestyles. They are surrounded in an environment of privilege where rules that govern the rest of the country don’t always apply to them. They are the lawmakers. They protect themselves not you!!!!!!
Most former congressmen and senators manage to leave, if they ever leave politics with more money than they had when they arrived. Is this the civil servant we elected. We are their servants. The lawmakers now use their position to enrich their friends and family not the general population they were elected to serve.
Peter Schweizer is a Fellow at the Hoover Institute, a conservative think tank at Stanford University. For a year now, he has been working on a book about Soft Corruption in Washington. He has a team of 8 student researchers to help him as most college professors do to assist in the research for their books. Then they teach a few classes and make all their students buy their books. If it makes the New York Times Bestseller List, they are guaranteed a few more semesters employed at the college.
He has his students reviewing financial disclosure statements of politicians. It is proof how some lawmakers make significant large amounts of money for themselves than you or I or other lawmakers. He noticed that if you are a member of congress, there are laws that do not apply to them. Congressmen get a pass on insider trading. For example, If a congressman is sitting on a health care committee, and say Medicare is considering not to reimburse someone for a type of drug, that is market moving information. If one can trade stock from that information, and do so legally, that becomes a great profit making opportunity and congressmen are doing it all the time.
Congress wrote the rules for this country and made sure that those rules do not apply to themselves. The corporate insiders that have access to non-public information that could affect the stock price, could be a criminal offense. Remember hedge fund manager Rodge Radham who recently got a 11 year sentence in prison for doing it. Lawmakers have no corporate responsibilities and have been exempt from insider trading laws even though they have access to non-public information and plenty of opportunities.
His research has proven that these elected people had been trading health care stocks during the health care debate. During the 2008 financial crisis they were getting out of the market before the rest of America really knew what was going on. For example, at that time, the Treasury Secretary Hank Paulson and Federal Reserve Chairman Ben Bernanke were having closed door private meetings warning congressional lawmakers that a financial meltdown could be happening within a few days.
One of them were Alabama Rep. Spenser Backus. Then he was the ranking member on the House Financial Services committee who is now its Chairman. The very next day after the secret meetings he made large stock trades buying large option trades that would go up if the market went down. This creep is warning America that we are heading for financial doom AFTER he buys options that would benefit him personally when it did happen. My name sake Frank Serpico exposed corruption in the New York City Police Department in the 70’s but this is legal corruption in Washington D.C. His financial disclosure form also indicated that he traded GE stock for a profit during the crisis.
During the Health Care debate in 2009, members of congress were trading health care stocks including House Majority Leader John Boehner. He led the opposition against the so called public option which was the government funded insurance that would compete with private companies. Just days before the final provision was killed off, this bastard bought health insurance stocks and all went up for a big profit for him. He wasn’t crying then.
There is a long history of self dealing in Washington and it doesn’t always involve stock trades. Politicians also like to purchase real estate deals at ironically just the right times to get big profits. When Illinois Congressman Dennis Hastert became Speaker of the House in 1999, he was worth a few hundred thousand dollars. He left the job 8 years later a multi-millionaire.
In 2005, Speaker Hastert got a $207 Million Federal earmark to build a prairie parkway through cornfields near his home. He bought up land adjacent to where the highway was supposed to go before anyone knew of the plans to build. Five months after the plans were revealed to the general public, he sold that land for a $2 Million profit. His neighbors were furious as we should be. He now works as a lobbyist in Washington. This bastard doesn’t have enough money? He has to get corporate lobbyist money too?
Former New Hampshire Senator Judd Gregg helped steer nearly $70 Million in government funds towards redeveloping a defunct Air Force base. He and his brother had a commercial interest in it.
If you were a Senator and I gave you $10,000 cash, you or I or both would be going to jail. But if I am a corporate executive and you are a Senator, and I give you the IPO shares in stock and in over the course of one day, that stock can net you $100,000 ! That is completely legal!!!!
Former house speaker Nancy Pelosi and her husband participated in at least 8 IPO’s. One of those came in 2008 from Visa just as a piece of legislation was going to be passed that would hurt credit companies. The Pelosi’s purchased 5,000 shares of Visa at the initial price and made big profits days later to the tune of a hundred thousand dollars. She never considered this a conflict of interest.
In essence, corporate executives, members of the executive branch and all federal judges are subject to strict conflict of interest policies but not the people that write the laws.
If you are a member of Congress, and you sit on the Defense Committee, you are free to trade Defense stock as much as you want to. If you are on the Senate Banking Committee, you can trade bank stock as much as you want and that regularly goes on in all these committees
Brian Bayard is a former Congressman who served 6 terms before retiring last year. He is the only one who tried to pass a bill preventing insider trading to be allowed to congressmen and senators. He wanted to restrict this practice from happening. They know in advance how a vote is probably going to go and overnight could make some really great trades.

In 2004 it was called the Stock Act, making it illegal for congressmen and senators to make trades on stocks based on non public information. It went nowhere. Only 6 sponsored it and no one showed up for the vote. Did you ever notice the seats are always empty in those arenas?
The situation has gotten worse now. In the past few years a totally unregulated industry has grown up in Washington called “Political Intelligence.” What a oxymoron name!! We all know there is no intelligence in politics!!! This industry employs the old boys again. They are the former staffers and congressmen to go around the halls of the capital gathering valuable non-public information and SELLING it to hedge funds and traders on Wall Street who can trade and profit on it.
Cash is not the currency in Washington D.C. what you know, information, is the profits in life that gets changed into cash. Even over drinks in a bar, talk about a bill being passed, make some trades and Bingo you are richer! And even if you trace it, it’s not illegal.

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