Discover more from Don Surber
Having made her millions, a congresswoman will retire
Democrat Grace Napolitano of California announced this weekend that she will retire when this term ends in January 2025. She will be 88. That you can retire from Congress reflects an electorate that pays scant attention to those who represent them in Washington, as shown by the 98% re-election rate in the House.
Grace went from being poor when she entered Congress after the 1998 election to a net worth of over $5 million. This coincided with the national debt rising from under $6 trillion when she arrived to more than $32 trillion today. Congress has overspent its annual allocation of taxes by more than $1 trillion a year during her tenure.
She got rich. The nation went broke. As Jerry Reed might sing, she got the gold mine; we got the shaft.
While many are the members of Congress whose wealth explodes while they oversee federal spending and regulate the companies they invest in, Grace was exceptionally good at increasing her net worth. She did so well, she could be a Biden.
Open Secrets, which keeps tabs on political money, did a story on congressional personal wealth in 2018.
The story said, “Not all politicians come into office wealthy — but many leave that way. Here are the top 10 winners of the past decade.”
Leading the league was Grace Napolitano, whose net worth rose from $8,000 in 2008 to $913,004 10 years later — an 11,312.6% increase.
In the five years since, she has quintupled that money as her net worth has hit $5 million. Her stick-to-itness is admirable.
Being on the Natural Resources Committee and the Transportation and Infrastructure Committee helped because they dole out billions with little oversight from the press or the public. Those assignments are donor magnets.
The Open Secrets file on her reported 79% of the cash she raised over the years came from PACs and 20% came from large donors. She did not work for the people of California; she often worked against their interests as she pleased those who made her wealthy.
Grace raised a little more than a million bucks in her first campaign, which was her average for her first three campaigns when she was the most vulnerable to defeat.
But then an odd thing happened. Her fund-raising grew rapidly as her need for campaign cash fell. As Telly Savalas said of the Players Club Gold Card, incumbency has its privileges.
By her 10th campaign, she was up to $1.73 million raised. The next campaign saw her raise $2.16 million — a million more than her original campaign. Then she raised $2.64 million and then $3.06 million.
The money she raised in her first 12 years in Congress helped propel her net worth.
The Whittier, California, Daily News, reported on February 20, 2009, “Napolitano uses campaign ruling to make more than $200,000 in interest on 1998 campaign loan.”
(The link is to the LA Daily News, which reprinted the story.)
The story said, “Napolitano has paid herself more than $200,000 in interest on a 1998 campaign loan, according to campaign finance reports.
“The $150,000 loan from herself was made during a June primary election where she faced James Casso, who was chief of staff at the time for outgoing Rep. Esteban Torres, D-Pico Rivera. Napolitano, D-Santa Fe Springs, ended up winning by 618 votes.
“She said at the time the money had come from her retirement account she had from her time working for Ford Motor Co.”
Grace retired from Ford in 1992 after 21 years, and entered politics. She used money she raised from subsequent campaigns to pay herself back. She charged her campaign 18% interest for 8 years, dropping it to 10% in 2006 and declaring the debt repaid in 2009.
All this pocketing of campaign money by congressmen is legal because Congress writes the rules.
Craig Holman, government affairs lobbyist for Public Citizen, told the newspaper, “The standard practice is once a campaign starts pulling in sufficient amounts of money you pay off the loan.
“I’ve never heard of anyone reaping off these profits. It’s looks like a 2-1 profitable margin. The interest rate is exorbitantly high.”
Only the mafia and credit card companies charge a higher interest rate.
In their stories about her departure, her wealth was not mentioned by CNN, the Los Angeles Times, The Hill, the Washington Times, the Associated Press, and all the other news outlets I checked. Even the Whittier Daily News ignored her loansharking of her own campaign, which the newspaper had reported on 14 years ago.
Her hometown paper, the San Gabriel Valley Tribune, said, “The setting for Napolitano’s announcement, 1.2 acres of land on the Grace F. Napolitano Nature Education Center, comes after a career in which she battled in Congress for environmental protections.”
Naming taxpayer-paid projects after yourself was pioneered by Hubert Humphrey and perfected by Robert C. Byrd.
The paper also said, “The former Ford Motor Co. employee focused on trade, small businesses, women’s issues, immigration, transportation and environmental protections” — it left out her focus on making money for herself.
The press is uninterested in her rise from rags to riches while in Congress. Reporters do not consider that news. Her help in getting her district a dog park was reported; helping herself to $5 million was not.
Members of Congress raking in millions while in office does not surprise or bother the press, which accepts the congressional excuse that politicians deserve the money because CEOs have salaries in the millions.
The difference is those CEOs create wealth while members of Congress create debt — more than a trillion dollars of additional debt each year.