How Did Harry Become So Rich?

[svHyLyte]

I dislike the matter of politics on a recreational forum but in as much as the forum is not unlike tha bar at a yacht club where all manner of subjects is likely to be dicussed, the recent debate betwwen Harry Reid and his GOP opponent raises a question of some substance and enquiring minds would like to know! (Particularly since he refused to answer the question with enormously exaggerated--but quite obviously faigned-indignation.)

Where/how did Harry become so wealthy? The following is abstracted from a recent piece by Mark Noonan on Nevada News and Views:

Senator Harry Reid has a minimum net worth of $2,827,056.00, a maximum worth of $6,307,999.00 and an average net worth of $4,567,527.00. Why all the discrepancies?

Because our leaders, much as they set up campaign finance laws to protect themselves, have set up their disclosure requirements to hide things. They don’t really want us to know how much they have and thus the millions of dollars of variance possible in Reid’s fortune.
Still, taking that nearly $4.6 million average for Reid seems fair – if it’s really off, then it’s up to Reid to correct the record. And that is quite a rise for a man who endlessly reminds us was born poor.

I’m pretty sure I’m safe in saying that for everyone reading this, that is quite a lot of money. In fact, more money than any of us are likely to (a) ever have or (b) even know what to do with, if we did have it. Lots of people start poor, work hard, and get rich – in the private sector.
The problem, for Harry Reid, is that since he graduated college, there hasn’t been a lot of time outside of government service. Reid was elected to the State Assembly in 1966 and in the past 43 years (when Reid went from 27 years old to 70 – and your humble correspondent went from 2 to 45), the only gap in public service was the two years in the mid-70’s between his term as Lt. Governor and his service on the Nevada Gaming Commission. And during that time he ran for Mayor of Las Vegas, leaving little time to build up a fortune in the private sector.

Right now, as Senate Majority Leader, Reid earns $193,400.00 per year – a back-bencher earns $174,000.00.

Reid has been earning that 193 grand for a few years, but when he first entered the Senate in 1987, I think the Senate salary was about $125,000.00 per year. In order to build up $4.6 million dollars over the past 43 years, Reid would have had to sock aside – out of various government salaries – nearly $107,000.00 per year.

Harry claims it came from "Wise Investments". Considering his demonstrated lack of comprehension of even basic economics--evidenced by his legislative record--where/how did his investment acumen suddenly develop?

Of course, Harry isn't the only one that should be examined, but he makes a convenient starting point, eh?

FWIW...

[jrd22]

Good point, and like you said there are many other career politicians that seem to have also made a lot of "wise investments". Term limits have a lot of appeal to me.

[T37Chef]

There is a P&R forum here, so have it here: http://www.sailnet.com/forums/politi...ar-government/

Maybe the mods can move it for you

[WanderingStar]

There was just a bit on the news revealing that it's not illegal for members of congress (or their staff) to profit from knowledge of impending legislation. You could make a lot of money by knowing where government contracts are going. More serious, there are all kinds of ways to launder money for influence.

[RAGNAR]

There's no end to the problems inherent in massive, intrusive government. Even when legislation that addresses valid concerns is passed, it's ignored or applied selectively. The only way to end this nonsense is to cut government down to its bare essentials.

[kootenay]

In looking at your numbers Mr. Reid's achieving a 3 million dollar net worth in that time simply isnt that hard. And as things go he isnt really that rich. In the 23 years he has worked he has by your lower figure earned 4 million in salary. Assuming he bought a house in DC, probably a fairly grand one and it appreciated over time in keeping with US values then his investment in 87 has probably at least quadrupled if not more. As with you and I it is to be expected that his home or perhaps home's, one in DC and one in his home state are his primary source of equity then achieving only 3 million to a high of 6 M isnt going to be that hard in the 23 years of his Senate career alone. So in reality he only had to start with about a 500-700 k purchase 23 years ago to get to the numbers you mention.

Not that hard for anyone to do with a 170k cash flow each year.

[svHyLyte]

Originally Posted by kootenay

In looking at your numbers Mr. Reid's achieving a 3 million dollar net worth in that time simply isnt that hard.
Not that hard for anyone to do with a 170k cash flow each year.

a. His "numbers" are cost based rather than value. On a vlaue basis his holdings are estimated at $45mm give or take.

b. Based upon the average return of the maket over the period, he would have had to invest $107K per annum to reach his current numbers.

c. His current salary is $193K per annum. A run of the mill senetor's salary is $170K. In 1977 a senator's salary was $44,600. It didn't break $100K until 1991 but in mid 1991 was increased by 25% (by the senate of course).

Frankly, given that these characters produce nothing of value, it would seem the salaries are vastly too great.

FWIW...

[kootenay]

I just looked at his net worth statement and sorry but the range isnt cost based it appears to be value based. He has some real estate holdings but has a great deal invested in resource investments along with a secondary position in health care. I see simply a wise investment strategy that is well diversified with little debt. As to the level of compensation for the job they do I am not that sure you are wrong but would you do the job and hold yourself up to the public abuse they get along with living your entire life in a fish bowl for 50k a year? I wouldn't.

et worth was calculated by summing the filer's assets and then subtracting any listed liabilities. Filers report the amount of each of their assets, transactions and liabilities as falling within one of several ranges. The minimum possible values for each asset are added together as are the maximum possible values. Likewise, minimum and maximum liability amounts are summed. The maximum debt figure was then subtracted from the minimum asset figure and the minimum debt figure was subtracted from the maximum asset figure. The resulting range represents the extremes of how much a filer could be worth and their actual net worth should fall somewhere within that range. The midpoint or average of the two limits was also calculated and used for purposes of ranking the filers by wealth. Using the average for these rankings avoids much of the distortion caused when a filer is highly leveraged. Due to the various ranges reported on the forms, filers with high liability totals as well as high asset totals could find themselves deep in the red and ranked accordingly low if the minimum possible net worth is used despite the fact that they are widely regarded as one of the wealthiest members of Congress. All three figures are displayed for reference, but the use of the average paints a picture that much more accurately reflects reality. The top range of "Over $50 million" limits valuation of very large assets. Additionally, Senate forms allow spousal assets to be categorized as “Over $1 million.” When further disclosure or research definitively reveals a more accurate figure, it is used in place of the range.

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