Politicians loaning their own campaigns money … collecting high interest revenue
What an ingenious revenue-generating idea! Politicians are loaning their own campaign money and letting the cash sit in campaign coffers at an interest rate MUCH higher than bank rates. The politicians collect the interest and keep it for themselves, allowing for an ongoing money-laundering scheme.
60 Minutes noted this – along with a bunch of other sweet deals congress-critters have taken advantage of – in a report on Oct. 20 that I missed. From Big Journalism.
On Sunday, a 60 Minutes investigative report by veteran CBS reporter Steve Kroft and Government Accountability Institute (GAI) President and Breitbart News Senior Editor-at-Large Peter Schweizer revealed how leadership PAC loopholes allow members of Congress to convert campaign cash into lavish lifestyle upgrades for themselves and their family members.
There are a bunch of great reasons in the post to ensure Congressional approval numbers stay in the single digits, so do read it all. Here’s an excerpt related to the campaign loans.
Rep. Grace Napolitano (D-CA) has bagged at least $294,245 since 1998 by loaning her congressional campaign money at interest rates up to 18%—a scheme that effectively funneled campaign contributor donations into her personal bank account. After numerous attempts to interview Napolitano, Kroft finally confronted her outside a Hispanic Caucus meeting.
“She told us that as a woman and a minority, banks wouldn’t lend her money, so she had to withdraw $150,000 from an investment account to lend it to her campaign,” said Kroft.
Kroft then questioned why she would charge 18% interest. “That’s what the Mafia gets,” he exclaimed.
“It isn’t like I’ve really profited,” said Napolitano. “I still live in the same house. I drive a small car. I am not a billionaire, or a millionaire, for that matter.”
Not really profited? She’s delusional. Along with her Congressional salary, she’s pocketed an extra $22,000 a year in interest payments!
All of these federal government distractions are distracting…
8 Comments
The website's content and articles were migrated to a new framework in October 2023. You may see [shortcodes in brackets] that do not make any sense. Please ignore that stuff. We may fix it at some point, but we do not have the time now.
You'll also note comments migrated over may have misplaced question marks and missing spaces. All comments were migrated, but trackbacks may not show.
The site is not broken.
Term limits.? No pensions, no goodies, no exceptions to the law.? Put them in barracks while in DC.?
?
Get in, do your job, get out, and live under the rules that you thought were good enough for us.
I am all for it. Too bad no politician in position to do that will vote for it.
Agreed.? That’s why we need new pols.
Agreed- and may I suggest providing for recall elections.
I call it racketeering
Nice catch, Steve.
$150k is not much in any election. For a Congressional seat, I would expect the costs — inflated, of course — to be in the multimillions of dollars.
The interest on a million dollars @18%, do check my math, is $180,000. Would that be taxed, if it is declared, at 15%, as a capital gain? ($153,000 net profit) So, a candidate who self-finances his/her own campaign can funnel money right back into their own pocket?
Tidy and lucrative little business loaning your own campaign money!
?
Loopholes in PACs, heh. ?She’s not satisfied with the perks, great healthcare, money for speaking engagements, salary and pension, she needs more? Oh for crying out loud, we need to back Sen Rand Paul and his bill to force Congress to live by the laws they pass for us.
Would that our vaunted politicians were as clever in their crafting of legislation *for* the citizens as they are in creating loopholes to advantage themselves.