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POPSReport: 237 millionaires in Congress
Senators’ estimated median reportable worth sunk to about $1.79 million from $2.27 million in 2007. The House’s median income was significantly lower and also sank, bottoming out at $622,254 from $724,258 in 2007. But CRP’s analysis suggests that some lawmakers did well for themselves between 2007 and 2008, even as many Americans lost jobs and saw their savings and their home values plummet. Senate Minority Leader Mitch McConnell (R-Ky.) gained about $9.2 million. Sen. James Inhofe (R-Okla.) gained about $3 million, Sen. Daniel Inouye (D-Hawaii) had an estimated $2.6 million gain, and Richard Shelby (R-Ala.) gained about $2.8 million. Some lawmakers have profited from investments in companies that have received federal bailouts; dozens of lawmakers are invested in Wells Fargo, Citigroup, Goldman Sachs and Bank of America. Vice President Joe Biden has often tagged himself as an original blue collar man. The CRP backs him up, putting his net worth at just $27,000.
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The basic questions we need to ask here are: 1. Why do economies recover? 2. Are we recovering? Q. Why do economies recover? A. They recover because bad investments made during the bubble are liquidated, valuable capital is no longer being wasted on them, new capital is formed from savings, and profitable enterprises attract new capital to expand. Low real interest rates caused by increased savings encourage borrowing, manufacturers use the capital to make new machines, producers of consumer goods buy them, cash goes through the system, consumers see things are getting better, more consumer goods are produced, and consumers buy them. It has to happen this way or the recovery will fail. The difficult part of a recovery is ugly. Bankrupt firms need to fail so that valuable capital resources are not wasted on their continuing activities. This means that unemployment rises (10.2% now) and business bankruptcies are high. Trillions of dollars of asset values are wiped out.
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