There is much money to be made selling investment advice. Mutual fund managers invest other people's money and charge fees based on a percentage of the amount invested and a percentage of the gains. A great many of the articles in business magazines such as Forbes and Fortune deal with what might happen in the business world; readers look for investment schemes which might make them money.
People are particularly eager to find sound investments in times of economic uncertainty. The US Treasury is selling zero-interest bonds. Yep, those are bonds that pay no interest whatsoever, but at least you know for sure you'll get your money back when the bonds mature - well, assuming that nothing really bad happens to the US Treasury.
Finally, into the void steps the New York Times with news of an investment strategy that guarantees risk-free gains of not 5%, not a picayune 10% as offered by the Bernard Madoff's erstwhile Ponzi schemes, but an absolutely guaranteed investment that returns 2,000% percent in one year.
The Times reports:
An upstate New York developer donated $100,000 to former President Bill Clinton's foundation in November 2004, around the same time that Senator Hillary Rodham Clinton helped secure millions of dollars in federal assistance for the businessman's mall project.
Mrs. Clinton helped enact legislation allowing the developer, Robert J. Congel, to use tax-exempt bonds to help finance the construction of the Destiny USA entertainment and shopping complex, an expansion of the Carousel Center in Syracuse.
Mrs. Clinton also helped secure a provision in a highway bill that set aside $5 million for Destiny USA roadway construction.
The bill with the tax-free bonds provision became law in October 2004, weeks before the donation, and the highway bill with the set-aside became law in August 2005, about nine months after the donation. [emphasis added]
Mrs. Clinton secured millions of dollars worth of help for the developer's shopping mall project. The Times doesn't tell us just how many millions, but used the plural, so let's conservatively assume that it's only two million. The developer got at least two million dollars worth of federal benefits a few weeks before donating $100,000 to Mrs. Clinton's husband's foundation.
We'd wondered how the Clintons went from being deeply in debt when they left the White House to being zilllionares; now we know.
The Times has revealed that one of the wonderful things about investing in politicians is that you get the benefit before you invest. You get the return first, and if you're satisfied, then you pay. Talk about a risk-free, high return investment!
In this case, assuming the developer benefited $2 million worth on an investment of $100,000, his return is at least 2,000%. Not bad, that.
After the developer made the contribution, Mrs. Clinton allocated another $5 million of our money for road construction to support his development which gave him another 5,000% return on his investment.
His contribution is the only known situation so far in which an American donor gave a large sum to Mr. Clinton's foundation while benefiting from his wife's official actions. [emphasis added]
The Times notes that the developer. a long-term Republican who raised $200,000 for President Bush's campaign, has contributed to Mrs. Clinton's Senate campaigns ever since she voted to give him our money. In the interest of accuracy, we ought to count his contributions to her campaigns as part of the cost of his investment. Adjusted for the money he gave directly to Hillary, his return isn't quite 7,000%, but it's still better than any return I can get. Not even "Ponzi Redux" Madoff promised returns that high; he offered a mere 10% and he couldn't make that.
Both Clintons and the developer aver fervently that the contribution had nothing to do with Mrs. Clinton earmarking money for his project. Yeah, right, and Illinois Gov. Rod Blagojevich is a reformer.
Given that the Clintons are famous for having associates who won't talk about their misdeeds. Susan McDougal who stayed in jail and James McDougal who died in jail rather than talk about their Whitewater partnership with the Clintons come to mind. Given such silent co-conspirators, there will never be proof that Mrs. Clinton sold us taxpayers down the river to help her husband's foundation and her campaign fund, but that's OK.
What counts is that the Times fulfilled their constitutional duty and got the facts before the voters. Anyone running against Hillary in the future will be sure to mention this little episode and let the voters draw their own conclusions.
One of the bothersome elements of this charade is how cheaply our politicians sell us out. The numbers released by the Wall Street Journal suggest that Rep Murtha (D-PA) got back about 1% of the tax money he gave to his friends as campaign contributions. A 1% "finder's fee" seems a bit picayune, but there may have been subtler payoffs which we don't know about which boosted Rep. Murtha's return on his investment of our money.
Sen. "Bridge To Nowhere" Stevens (R-AK) was convicted of receiving about $250,000 from oil companies; that's a pittance compared to his trying to spend $400 million of our tax money on the bridge to nowhere.
From what we can glean from the phone transcripts, Gov. Blagojevich seemed to be willing to sell Mr. Obama's late Senate seat for $100,000 plus a good job. That's traditional; Mrs. Obama got a pay raise of $200,000 per year when Mr. Obama first entered the Senate. Sen. Obama soon directed a $1 million earmark to his wife's employer. Mrs. Obama's employer got a 500% return on the raise they gave her!
With returns like that, I could take out a home loan and buy that Senate seat myself; I'm sure my wife could conveniently find a good consulting job somewhere or other if I were a Senator.
If these people are going to sell us out, why not raise their prices? Mr. Clinton got millions and millions from the Saudis; why should Gov. Blagojevich let a US Senate seat go for a mere hundred grand? Why should Caroline Kennedy get a Senate seat for free? Does anyone think that whomever gets it will get it for free?
As Gov. Blagojevich was famously recorded observing, the Senate seat "is a f--ing valuable thing, you just don't give it away for nothing." It costs tens of millions of dollars in campaign funds to get a Senate seat and many people are willing to pay the price even if they aren't certain to win the election; why shouldn't ol' Rod charge something closer to market value? He wasn't being greedy. Quite the contrary: he didn't consider the asset to be anything like as valuable as it really is.
It's perfectly clear why Mr. Clinton kept his donor list secret until forced to cough it up for Hillary to get a cabinet seat - St Paul long ago counseled everyone to "avoid the appearance of evil." One of the best ways to avoid the appearance of evil is to keep everything secret. That allows you to enjoy the fruits of evil while avoiding its appearance, an art the Clintons mastered long ago.
Mrs. Clinton echoed Mrs. Pelosi's criticism of the Republican "culture of corruption" two years ago, several years after she'd funded highways for a private profit-making real estate development and got a high bracket Republican to start supporting her campaigns. You might have thought at the time that the Democrats were actually opposed to corruption.
As recent events have made plain, however, nothing could be further from the truth: the only thing Democrats didn't like about Republicans stealing our money was that they weren't in on it. Once they were in the majority and could send our money to their friends, the good times rolled on. For all the distasteful behavior of Republican slimeballs Mark Foley and Larry Craig, at least their extracurricular fun and games did not play out at your expense.
If you're content with single-digit returns, stick with conventional investments, but for really spectacular risk-free returns, go out and invest in a politician or two. They're cheap!
In the interest of full disclosure, however, it's only fair to point out that you'd better be able to keep a straight face when assuring reporters that your returns had nothing to do with your investment. You can't wink or nod in public, of course, but that's about all the fine print there is in the prospectus for investing in politicians.
Mr. Obama and the Democrats are speaking of spending many billions to "stimulate" the economy. The more money the government spends, the more they skim.
Culture of corruption? We ain't seen nothin' yet.