Monday, January 29, 2007


This LA Times article is potentially disastrous news for Senate Democrats.

It’s hard to buy undeveloped land in booming northern Arizona for $166 an acre. But now-Senate Majority Leader Harry Reid effectively did just that when a longtime friend decided to sell property owned by the employee pension fund that he controlled.

In 2002, Reid (D-NV) paid $10,000 to a pension fund controlled by Clair Haycock, a Las Vegas lubricants distributor and his friend for 50 years. The payment gave the senator full control of a 160-acre parcel in Bullhead City that Reid and the pension fund had jointly owned. Reid’s price for the equivalent of 60 acres of undeveloped desert was less than one-tenth of the value the assessor placed on it at the time.

Haven’t we heard of Harry’s real estate bargains before? Did Reid think that nobody would notice? Frankly, Dingy Harry has gotten more great deals than any American politician in my lifetime.

What’s worse news for Democrats is that they’re betwixt and between on this. If they don’t make an example of Reid’s shady land deals, then they’ll be characterized as totally corrupt. Remember that Reid short-changed an employee pension fund, giving them only 10 cents on their retirement dollar. Based on this article, the assessor valued the property at more than $100,000 per acre. I’m not a real estate expert but that seems cheap in a hot real estate market.

If they do make an example of him and expel him from the Senate, that gives Jim Gibbons, the Republican governor or Nevada, the power to name Reid’s successor. If the Democrats don’t make an example of Reid, people will know that they aren’t worthy of the public’s trust. They’ll know that Democrats will sell out anyone for a buck.

Believe it or not, it gets worse:

Six months after the deal closed, Reid introduced legislation to address the plight of lubricants dealers who had their supplies disrupted by the decisions of big oil companies. It was an issue the Haycock family had brought to Reid’s attention in 1994, according to a source familiar with the events.

Can you say quid pro quo? It’s difficult, if not impossible, to conclude that this was slush money paid to Reid for his intervention on a constituent’s behalf.

If Reid were to sell the property for any of the various estimates of its value, his gain on the $10,000 investment could range from $50,000 to $290,000.

That’s probably the most conservative thing that I’ve heard from the LA Times in ages. Based on their own reporting, Reid paid $166 per acre was “less than one tenth” of what the assessor valued the land at. Frankly, I’m skeptical of that assessment. Frankly, I can’t imagine this land not being worth $50,000 per 1/3 acre lot, not $166 per acre. That would put Reid’s eventual profits alot higher than $290,000.

Based on this information, this deal makes Hillary’s futures deal all those years ago look modest. And that takes some doing. That takes alot of doing.

In a statement, Reid’s spokesman Jon Summers said that the transaction was not a gift and that the price was due to the property’s history and the fact that only a partial interest was sold. Reid’s action on the lubricants issue was unrelated to the sale and reflected the senator’s interest in fairness for small businesses, Summers said.

RIIIGGGHHHHTTT. Harry Reid, the small businessman’s hero. That should be his campaign slogan the next time he runs. That is, if he isn’t run out of the Senate before that. If he’s such a friend of small business, why would he have ripped of this small business’s pension fund that badly?

Because an employee pension fund had owned the land Reid purchased, labor law experts contacted by The Times said, a below-market sale would raise additional questions. Pension fund trustees like Clair Haycock have a duty in most cases to sell assets for their market value, the experts said.

“I think this would have been considered a potentially serious issue” at the time, said Ian D. Lanoff, who led the Labor Department’s pension division during the Carter administration…

Let’s suppose for the sake of discussion that Reid didn’t push legislation for this ’small business owner’. Let’s stipulate for this discussion that he simply paid 1/10th of the market value of the land, keeping in mind that Reid essentially bought this from the employees’ pension fund. At a time when pension funds are badly underfunded, this is serious business.

If there is justice in this world, Harry Reid will be run out of town on a rail & Republicans will have a 50-50 split in the Senate. The bad news is that I doubt that there is justice in a Democrat Senate.

Can you say ‘Democrat Culture of Corruption’?

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