The book attempts to be non-partisan, and lists examples from both sides of the aisle of those who have benefited from their access to insider information and their abilities to manipulate the market, as well as steer legislation that would benefit their private coffers. There is, however, a fairly heavy focus on the party in power today, which I believe has two reasons: first, the party with the most control over legislation is the most heavily courted, and gets to appoint its cronies to positions of power, and second, our memories are short, and we'd probably have no idea who Schweizer was talking about if he detailed all the business wheelings and dealings of previous administrations.
I'm certain that we all recall the broad strokes of the events that led to the banking crisis in this country. Schweizer relates the story of a briefing that took place between the leaders of The Fed and major Senators and Congresscritters from both sides of the aisle, warning them of the coming collapse of many of the megabanks. Within days after that meeting, many of the attendees sold off large blocks of stock that they owned in those banks, knowing that the prices would go tumbling down. While the rest of us took our losses in the market meltdown that followed, our humble representatives didn't lose a dime!
Then, as meetings went on throughout the crisis, when it became apparent that the TARP bailout was actually going to be passed and put into place to rescue many of the banks, the same group of folks quietly bought back bank stocks that they knew would be getting bailout money, at bargain basement prices.
"One study by scholars at the University of Pennsylvania's Wharton School of Business and the University of Chicago found that during the critical votes on the subprime-mortgage bailout and subsequent matter related to the financial crisis of 2008, a key facto in how members of Congress voted was whether they held stock in banks and in the financial sector. Personal equity ownership also influenced congressional committee decisions on the amount of bailout money particular financial institutions received and how quickly they got it."
The truly scandalous thing about all this, however, is not that they're doing these sorts of things, but that the Congressional Ethics Committee deems it acceptable. When a particular member of the House Financial Services committee approached the ethics experts there about whether it was OK for him to use options puts and calls to double his congressional salary, they gave him the green light. If members of Congress buy and trade stock based on "valuable information revealed in private meetings, phone calls and correspondence" they are not guilty of any wrongdoing - by their own rules!
Members of Congress also are known for increasing the value of their private real estate holdings by the legislative earmark process. They can be instrumental in determining which local municipalities get federal money, and see to it that roads are built granting access to previously undeveloped plots of land which, coincidentally, they own, or approving light rail projects within walking distance of their commercial buildings, and they are!
Companies or industries that make the investment, not in R&D, but in political campaign donations, seem to have an edge when it comes to receiving government contracts or funding. In the case of the stimulus package recently, billionaire venture capitalist John Doerr has donated almost $2 million to Democrats over the past twenty years.
"...well over 50% of the companies listed...as part of his Green-tech venture capital portfolio received taxpayer grants or loan guarantees from Obama's stimulus program."
- One company alone received $102 million in credits!
- 60% of another of Doerr's company's customers were winners of government grants totalling more than $560 million!
These are just a few examples of the outrageous actions of our ruling political class. Plenty more in the book. I consider this book a must-read for all voters before Election Day 2012.