Politicians and Legal Bribery

Last week I wrote about how Senator Dodd is heavily bankrolled by the industry in which his committee is supposed to be monitoring and regulating. I wanted to take that story a step further.

Over the weekend, the Wall Street Journal reported that the housing industry has already given more money in political contributions this election cycle than in the entire previous cycle.

More than $95 million has been given to politicians. Why such the high paybacks? There is key legislation in the works out right now by the politicians to rescue the housing markets. Of course, these political contributors have a lot to lose. Thus, they resort to the best weapon when it comes to politics….legal bribery.

Steve O’Connor of the Mortgage Bankers Association commented that it was “relationship building…..a way to educate (lawmakers) as to how our industry works and its perspective.”

Really, I can’t make this stuff up. What happened to writing your Representative? Isn’t that how we are supposed to be able to influence and “educate” our politicians? Well, you better include a cash donation with that letter.

Representative Barney Frank commented that there was no way that this would be an influence on their positions on legislation.

Well, who am I to accuse the integrity of a politician? I don’t know what happens behind closed doors. I am just looking at the details and the ugly picture they paint.

1) The housing industry wouldn’t be forking over 95 million dollars to politicians if it did not help their cause. Let’s face it! This is an industry that is greatly hurting. I am sure that there would be better uses for $95 million than for “educational purposes and relationship building.”
2) Politicians put themselves in a bad position. Simply put, this is human nature of the worst kind. There is no way that a politician can say with a straight face that this doesn’t influence their decision making. Once again, (see #1) if this were not influential, the money would stop flowing. For example, the National Association of Home Builders cut off their campaign contributions because they weren’t getting what they wanted. You won’t be surprised to know that things all of the sudden changed when the legislation started to be more industry friendly.

As you would expect, Countrywide has been a big contributor to the politicians on the committees that they need the most help. The Wall Street Journal reports that Countrywide has at least three state probes of possible mortgage fraud.

You wonder why things are not getting done in Washington. You wonder why it is taking so long for industry members to be held responsible for their action.

The bottom line is that no politician can serve political campaign contributions and American citizens at the same time. Once again, November is a great opportunity for the voice of the American people to be heard. Your vote can count and be heard. It is too bad that the citizens of this great country sit back and let these politicians work to get elected rather than work to serve.

The excuse that this is just politics doesn’t cut it anymore.

Copyright © 2008 Prudent Money and Bob Brooks. All rights reserved.