How Former Senator Harry Reid Became a Multimillionaire
The answer is simple: careful investing.
Cynics say that he put his money with the George Washington Plunkitt Fund. It always produces spectacular returns.
Wikipedia says that George Washington Plunkitt (1842–1924) was a long-time New York State Senator who was part of what is known as New York’s Tammany Hall political machine. Plunkitt became wealthy by practicing what he called “honest graft” in politics. He was a cynically honest practitioner of what today is generally known as “machine politics,” patronage-based and frank in its exercise of power for personal gain. In one of his speeches, quoted in Plunkitt of Tammany Hall, he describes the difference between dishonest and honest graft: for dishonest graft one worked solely for one’s own interests, while for honest graft one pursued the interests of one’s party, one’s state, and one’s personal interests all together.
He made most of his money through land purchases, which he knew would be needed for public projects. He would buy such parcels, then resell them at an inflated price. (This was “Honest Graft”. “Dishonest Graft” according to Plunkitt, would be buying land and then using influence to have a project built on it.) He defends himself, saying, “I could get nothin’ at a bargain but a big piece of swamp, but I took it fast enough and held on to it. What turned out was just what I counted on. They couldn’t make the park complete without Plunkitt’s swamp, and they had to pay a good price for it. Anything dishonest in that?” Plunkitt is also remembered for the line he used to defend his actions: “I seen my opportunities and I took ’em.”
What has all this got to do with Harry Reid? Nothing, of course, although he did make a lot of his money in land. We read this in a recent report.
He had managed to get $18 million set aside to build a bridge across the Colorado River between Laughlin, Nev., and Bullhead City, Ariz., a project that wasn’t a priority for either state’s transportation agency. His ownership of 160 acres of land nearby that stood to appreciate considerably from the project had nothing to do with the decision, according to one of his aides. The property’s value has varied since then. On his financial-disclosure forms from 2006, it was valued at $250,000 to $500,000. Open Secrets now lists it as his most valuable asset, worth $1 million to $5 million as of 2010.How Reid acquired that land is interesting, too. He put $10,000 into a pension fund his friend Clair Haycock controlled, to take over the 160-acre parcel at a price far below its assessed value. Six months later, Reid introduced legislation that would help Haycock’s industry, a move many observers said appeared to be a quid pro quo, though Reid and Haycock denied that the legislation was the result of a property deal.
It was just one of those things. One of those crazy things. So was this.
In 2004, the senator made $700,000 off a land deal that was, to say the least, unorthodox. It started in 1998 when he bought a parcel of land with attorney Jay Brown, a close friend whose name has surfaced multiple times in organized-crime investigations and whom one retired FBI agent described as “always a person of interest.” Three years after the purchase, Reid transferred his portion of the property to Patrick Lane LLC, a holding company Brown controlled. But Reid kept putting the property on his financial disclosures, and when the company sold it in 2004, he profited from the deal — a deal on land that he didn’t technically own and that had nearly tripled in value in six years.
For more juicy deals you and I missed out on, read the article.
Continue reading on nationalreview.com.
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Published on August 20, 2012. The original is here.