They Ended Up Doing Very Well

My wife doesn’t watch much television, but she has an affinity for English detective shows. Having heard rave reviews (all warranted) about Foyle’s War we began to watch the series which is broadcast on PBS. This past weekend we saw the final episode which takes place as World War 2 is ending. The murderer is running for Parliament—as well as being a murderer, he has also stayed out of the war by faking a heart condition. Near the end of episode, Foyle dryly observes to the captured suspect, “Having evaded the draft, murdered a member of the medical profession, tried to avoid detection to feather your own nest, I’d have said you were a born politician. But, the Law being what it is, hanging is perhaps the very best way you can serve your country.”

Foyle’s character is absolutely unimpeachable—as such, he has no use for arrogant bureaucrats and politicians who cheat, compromise, and put their own career above the public and the law. I make no claim to be as flawless a character as Foyle, but I do share his disgust for most politicians.

The morning after we watched the episode, The New York Times reported that Congressman Charles Rangel “paid no interest for more than a decade on a mortgage extended to him to buy a villa at a beachfront resort in the Dominican Republic.” Rangel, who continually advocates and votes for higher taxes for the rest of us, “earned more than $75,000 in rent on the vacation home since 1988” and paid no taxes on the rental income.

This is not the first time that Rangel has made the news as one of our more visibly corrupt politicians. In July, we learned that he was leasing, from a prominent real estate developer, four New York City rent-stabilized apartments, including one he used as a campaign office. This was in violation of New York State law which limits these plum units, which can rent for thousands under the market price, to one for a primary residence. Rangel has defiantly given up only one of the apartments; he has vowed to keep the other three.

We further learned this summer that Rangel, who is chairman of the powerful House Ways and Means Committee, has been shaking down corporations who have business before his committee for contributions to his “monument to me”—the Charles B. Rangel Center for Public Service at the City College of New York. Before shaking down corporations, Rangel had begun with the taxpayers who coughed up almost $2 million for his building that, among other things, will house this “great” man’s papers.

When a two-term congressman objected to Rangel’s center, he retorted: “I would have a problem if you did it, because I don’t think that you’ve been around long enough . . . to inspire a building like this in a school.” In other words, to Rangel, this is just one more perk of the job that seniority earns. And some agree, such as New York Sun editor Seth Lipsky who wrote: “In Europe, they’d have given him a castle and a realm.”

Presumably, Lipsky means that Rangel deserves a reward for his great deeds. But I wonder if Lipsky can name one great deed. Of course, while enriching himself, Rangel has posed as a champion of the poor and downtrodden.

Milton Friedman used to say of politicians: “They came to do good and they ending up doing well.” Friedman gives politicians too much credit. The implication is that originally they were honest, but then they were corrupted by the system.

If Rangel was truly interested in helping the poor, I can think of many ways he could have helped. Perhaps instead of illegally occupying apartments, he could have been a low-cost housing developer. Instead of building a monument to himself, he could opened a discount supermarket in a poor area. If he preferred a more anonymous life, he could have volunteered in a soup kitchen. And if his talents were such, he could have invented something that would have improved the lives of millions.

Instead, Rangel has chosen to enrich himself at the expense of the taxpayers. We have only ourselves to blame. Charles Hugh Smith observes:

Look around; why are the politicians who pander most and pander best the ones who get re-elected? Why is the most visibly ludicrous and false posturing accepted with nary a complaint, and the mainstream media/CNBC/Fox propaganda sucked up like a sugar-free soda? What are we so afraid of? That we can no longer work, or cut our own path, or deal with challenges that require long-term thinking and sacrifice?

Rangel’s almost 40 years in the House, feeding at the public trough, would make the founding fathers sick. They envisioned a government served by individuals of accomplishment, who would serve the public for a short time at a sacrifice to themselves, before resuming their normal life.

Imagine this—a Cato Institute study found that “it was 1900 before the average number of terms served by House members exceeded two.” Doug Bandow further writes:

Average turnover during the Republic’s first century was 43 percent; more than a third of members simply retired of their own accord, to resume previous professions or develop new ones. Not until 1900 did electoral turnover fall below 30 percent. And total turnover was occasionally staggering: 76 percent in 1842, 63.8 percent in 1852, 63.7 percent in 1816, 62 percent in 1854, and 61.5 percent in 1862.(67) Back then, elections were heavily policy driven—disgusted voters would transform Congress in one election if angry over Federalist opposition to the War of 1812, passage of the Fugitive Slave Act, the compromise over slavery in the Kansas territories, the Republican party’s prosecution the Civil War, or any number of other serious issues. Even in the second half of the 19th century, turnover averaged 50.2 percent.

Term limits are one way to deter career politicians, but I can think of others. Make it impossible for them to earn more than a Congressional salary. If campaign money could not be used for personal advantage and it was impossible to place family members in plum positions that would be a beginning. Then zealously prosecute any advantage (interest free loans, etc.) that any Congressman receives. Many of the current Congress would quickly pack their bags and leave. They can then write their memoirs explaining all the good they came to do.

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12 Responses to They Ended Up Doing Very Well

  1. E says:

    I think the way to fix this is… ah… term… limits… and limiting how much time a politician can squat in his office and…. oh nevermind, did anyone see that Lehman is about to get wiped out? Down 44% to under $8 today, and down 91% since March of last year. Amazing. (Additionally, Fannie Mae and Freddie Mac, one down from highs of — don’t quote me, just blinding guestimating — about $63.37/share back in Nov, 2007 and about $64.40 mid Nov 2007, respectively — On monday, they closed down to about $.66 (66 cents). Wow… what total collapse. As far as Lehman, lots of chatter swirling around (that their expected valuation of $8B for the ENTIRE COMPANY… in light of Sept 18 earnings report; which, is expected to be bad).

  2. igli1969 says:

    And who are primarily responsible for the current housing market problems? Career politicians! One of their pandering methods is to offer things in the private sector to those who otherwise could not afford them; access to low-rate mortgages is only the latest of those offerings to blow up in a fit of unintended consequences. By forcing lenders to approve mortgage applications from “minorities” that may not have met the criteria for a loan by threatening the lenders with discrimination prosecutions, the panderers set the stage for this “crisis.”

    So these same politicians helped create the current “crisis,” and now are laying the groundwork for the next one with their actions now. By taking over Fannie and Freddie, rather than letting market activity penalize mistakes and reward prudence, these fools are saying, “Go ahead and build mansions on shifting sands. We’ll help you rebuild when disaster strikes.” (I obviously am referencing other government mistakes, like cheap flood insurance.)

    Unfortunately, this system is far too entrenched to be reformed or changed by voting. At least, by voting with a ballot.

    Chris C.

  3. E,

    Of course term limits will only go so far, because until the public’s attitudes change, one “Rangel” will just be replaced with another “Rangel.”

    Chris,

    The “system” is entrenched because the public remains unwilling to explore their basic beliefs. As within, so without.

  4. James D. says:

    The system also remains entrenched because people continue to believe the lies politicians use to keep themselves in office. “I sincerely believe that banking establishments are more dangerous than standing armies, and that the principle of spending money to be paid by posterity, under the name of funding, is but swindling futurity on a large scale.” Thomas Jefferson, as well as many other of the founding fathers, understood the corruption of public office. When the groups ruling each sector, say banking and government, end up being the same people, all they will end up doing is scratching each other’s backs. When a new administration wants to put new people in, who do they draw from? The CEO’s of the big banks, like Lehman. Once in government, what do they do? Watch out for the public? Bah! They cater to those who got them where they are. When the next adminstration gives them the boot, where do they go for work? Back to the firms they so richly supported in office!

  5. Frank v2 says:

    As the British historian John Acton once said, “Power tends to corrupt, and absolute power corrupts absolutely. Great men are almost always bad men” (http://www.phrases.org.uk/meanings/288200.html ). My father in the mid 1980s suggested that if someone is thinking about getting into the field of politics, and “…If you can talk out of both sides of your mouth at the same time, mean not one word from either side and still sleep at night – go for it!”

    Unfortunately honesty and integrity are not prerequisites for the job. However, I do believe like Milton Friedman indicated that all people do have some goodness somewhere in their souls, and that it is our egos need for self-gratification that can allow even those with the best of intentions to stray.

    The field of politics is like dropping a five year old into the center of the Hershey’s chocolate factory and saying “hands off”. Our politicians our handed access to a lot of power and money. I can see how one could be tempted. I’m not suggesting that this is the right course of action, only that it would be easy to abuse the situation at hand. (Holy smoke Batman – v2 is sounding sympathetic toward the politician that strays. Something is clearly out of sync in the universe. Must be a result of the Swiss atom smashing tests….. http://www.comcast.net/articles/news-general/20080909/Big.Bang/ )

  6. James,

    Great quote and analysis. We now have socialism for the rich!

    Frank,

    Precisely, that is why the Founders had such strong checks and balances (that are now ignored). Did you know that originally the VP was the second highest vote getter in the electoral college. Instead of Cheney, Al Gore would have been VP in 2000.

  7. James D. says:

    This is one of the core issues I see between the Dems and Repubs that make neither fit for office. The Dems see private business as an evil to be taxed and regulated, ignoring the fact that its what powered the greatness of America forward. The Repubs seems to take it for granted and reward each other with enormous amounts of money taken from 95% of Americans with nothing returned. Either way, both parties are shafting the American systems (not to mention the Americans!) that made this country the powerhouse that it is.

  8. Jim,

    To your point see Charles Hugh Smith’s recent blog post “Two Failed Parties: The Real Political Narrative of The Past Half-Century” and Nouriel Roubini’s “Comrades Bush, Paulson and Bernanke Welcome You to the USSRA (United Socialist State Republic of America).” I don’t agree with everything Smith or Roubini write but both are well worth reading.

  9. frankvv says:

    Dr. B,
    I did not know that the VP was elected based on receiving the second highest votes. That would mean that one could have a Democrat President and a Republican VP? That would certainly generate strange bedfellows, particularly with the folks that are running in this election.

  10. Frank,

    Exactly! The idea was indeed to generate “strange bedfellows” as another check and balance on power.

  11. E says:

    Dr. Brownstein is accurate. In 1796, John Adams was elected President while his strident opponent, Thomas Jefferson, was elected Vice President. This was a result of the election contruct from Article II, Section 1, Clause 3 of the Constitution, which states that each member of the Electoral College would cast two votes for the President (problem was repeated in election of 1800). The person receiving a majority of the Electoral Votes becomes president, and the second highest tally, Vice President. The Twelfth Amendment changed this and requires electors to cast two distinct votes — one for President and another for VP. Since then, there’s been a President and a VP.

    No discussion of AIG? What the hell is going on here. The Treasury decides not to bail out Lehman but bails out AIG? This is too arbitrary and random. Crazy times.

  12. E,

    The AIG news is stunning. I will write about it. But tomorrow is a post about Android.

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