Throw Them All Out:
How Politicians and Their Friends Get Rich Off Insider Stock Tips, Land Deals, and Cronyism That Would Send the Rest of Us to Prison
It’s one of the biggest scandals in American politics: the hidden workings of Washington’s inside game that will shock readers on both sides of the political divide. In THROW THEM ALL OUT (Houghton Mifflin Harcourt, November 15, 2011), best-selling author Peter Schweizer uses stunning anecdotes and unprecedented research to expose the insidious graft and greed of our politicians and their cronies.
For the most part, politicians come to Washington with modest assets. As investors, they regularly beat the stock market and sometimes beat the most lucrative hedge funds. Even without making stock trades, they often retire rich. How do they do it? As Schweizer explains in THROW THEM ALL OUT, this “Permanent Political Class” work together to enrich themselves at the expense of the American people, using their positions to leverage profits for themselves and their families.
These are not the kind of corrupt politicians from days of yore; they don’t stuff money in their freezers or take bribes. That type of crime seems almost quaint in comparison. This is the insidious world of crony capitalism — and it’s all legal. In fact, there’s not a line about insider trading in either of the four- and five-hundred-page House and Senate ethics manuals. But as Schweizer thoroughly investigates in THROW THEM ALL OUT:
For the most part, politicians come to Washington with modest assets. As investors, they regularly beat the stock market and sometimes beat the most lucrative hedge funds. Even without making stock trades, they often retire rich. How do they do it? As Schweizer explains in THROW THEM ALL OUT, this “Permanent Political Class” work together to enrich themselves at the expense of the American people, using their positions to leverage profits for themselves and their families.
These are not the kind of corrupt politicians from days of yore; they don’t stuff money in their freezers or take bribes. That type of crime seems almost quaint in comparison. This is the insidious world of crony capitalism — and it’s all legal. In fact, there’s not a line about insider trading in either of the four- and five-hundred-page House and Senate ethics manuals. But as Schweizer thoroughly investigates in THROW THEM ALL OUT:
- Members of Congress trade stocks based on privileged information. Senator John Kerry regularly and aggressively traded health care stocks while helping write health care legislation. Former Speaker of the House Nancy Pelosi received insider IPO shares and bought millions more in Visa stock, and shortly thereafter she blocked four bills that would have helped consumers and harmed the company. John Boehner bought shares in five health insurance companies just as he killed the “public option” on health care.
- They insert earmarks into bills to improve their own real estate holdings. Former Speaker of the House Dennis Hastert used an earmark to pull off a multimillion-dollar land deal that helped make him rich. Former Senator Judd Gregg earmarked some $66 million in taxpayer money to transform an air force base into a new wing headquarters and business park; his brother was the developer of the new air base, and Gregg himself had between $450,000 and $1 million of his own money invested in the commercial center.
- Campaign contributors routinely receive billions in federal grants. Solyndra is only the tip of the iceberg. Over $10 billion worth of stimulus grants and loans were directed to companies run or owned by members of Barack Obama’s 2008 campaign National Finance Committee and his campaign-donor “bundlers.”
- An entire class of investors flocks to Washington. Hedge-fund managers and others routinely become rich by getting advance word of policy decisions, and then they reward politicians with massive contributions to their election campaigns.
For the rest of us, this is called insider trading, conflict of interest, and kickbacks. We would be investigated; we would go to jail. But for politicians, as well as for businessmen and investors who get rich through their political connections, it’s completely legal. Unfair, unethical, and immoral — but legal.
Why hasn’t this dirty laundry been aired to this extent before? Because politicians don’t have to report their stock transactions until the next year, so it is extremely difficult to connect their financial activities with their work activities. For two years, Schweizer led a team of indefatigable researchers to backtrack and correlate the politicos’ stock trades with the legislative calendar. Like reverse engineering, it took a lot of work and patience; our current disclosure system succeeds in providing a lot of information without actually disclosing much of anything.
Why hasn’t this dirty laundry been aired to this extent before? Because politicians don’t have to report their stock transactions until the next year, so it is extremely difficult to connect their financial activities with their work activities. For two years, Schweizer led a team of indefatigable researchers to backtrack and correlate the politicos’ stock trades with the legislative calendar. Like reverse engineering, it took a lot of work and patience; our current disclosure system succeeds in providing a lot of information without actually disclosing much of anything.
THROW THEM ALL OUT shines a light into the darkest corners of the system and offers ways to overcome it. “We need to break the cycle of crony capitalism, land deals, and insider trading,” says Schweizer. “And we can do it simply by applying the rules that the politicians expect the rest of us to abide by.” It is time to clean house. Peter Schweizer explains why, and shows us how.
Peter Schweizer is the William J. Casey Fellow at the Hoover Institution, Stanford University. His books have been translated into eleven languages and include Do As I Say (Not As I Do), Reagan’s War, and Architects of Ruin. He has written for the New York Times, the Wall Street Journal, the Los Angeles Times, USA Today, National Review, Foreign Affairs, and others. He has appeared on ABC News, NBC News, CBS News, Fox News, CNN, MSNBC, CNBC, and the BBC. Schweizer currently edits Bigpeace.com. He lives in Florida with his wife and children.
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