US lawmakers get richer as voters struggle

Lawmakers are increasingly likely to be multimillionaires
and are on average nine times richer than
the other Americans
© AFP/File Saul Loeb

AFP

WASHINGTON (AFP) – The wealth gap between members of Congress and ordinary Americans is growing larger, with nearly half of all lawmakers now worth more than one million dollars, according to US media reports Tuesday.

US lawmakers are increasingly likely to be multimillionaires and are on average nine times richer than the other Americans, according to data made available to the New York Times and Washington Post.

The papers reported figures from the Center for Responsive Politics that showed the median net worth of a member of Congress stood at $913,000 and is climbing, compared to $100,000 and falling for the rest of the population.

Amid protests against the country’s wealthy elite that have seen many US cities “occupied” by demonstrators, it appears elected many elected representatives make up the “one percent.”

Among the richest is Republican representative from California, Darrell Issa.

According to separate figures from the Center for Responsive Politics’ released in November, Issa was worth $195 to $700 million last year, his fortune coming from his car alarms business.

Texas Republican Representative Michael McCaul and Democratic Senators John Kerry, Mark Warner and Herb Kohl were also among the most wealthy.

According to the Washington Post, members of the House of Representatives were worth an average of $725,000 in 2009 compared to $280,000 in 1984, adjusted for inflation. Those figures do not include home equity.

Their wealth stands in stark contrast to the economic fate of most Americans, who have seen their value shrink over the last two decades.

Over the same period American families saw their average wealth drop from $20,600 to $20,500, also inflation-adjusted and not including home equity.

The reasons for the gap are far from clear, although many point to the cost of running for office being a deterrent to the poor, and also lawmakers being able to profit from market-moving knowledge.

“I am sure that there are multiple reasons for it,” Alan Ziobrowski — a professor at Georgia State University — told AFP.

Ziobrowski, who has studied how lawmakers’ stock investments have faired, said “the situation is pretty straight forward” with regard market-generated wealth.

“You have got a Congress which is preoccupied with three things, with regulation of industries; they are preoccupied with taxes and they are preoccupied with the federal budget. Any one of those things can have an absolutely profound impact on stock price.”

“They know about them before anyone else does and that certainly leaves them in a position that they can take advantage.”

But that also gives rise to suspicious that the game might be rigged: “That is the underlying ethical question… when they do cast a vote are they casting it for their constituents, or are they casting on behalf of their portfolio? Unless you look in their head, there is no way of knowing.”