Roll Call June 20, 2002

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Millionaires in Senate Top 40 for First Time>

By Amy Keller

At least 40 of the 100 Senators had a minimum net worth of $1 million last year and, collectively, Senators held at least $768 million in assets, according to 2001 financial disclosure forms released last week.

The imprecise nature of the disclosure requirements makes it likely that the actual figure is dramatically higher.

Not surprisingly, Senators are far wealthier than the average member of the general public. Due in part to the nine-digit fortunes of lawmakers such as Sens. John Kerry (D-Mass.) and Herb Kohl (D-Wis.), Senators have an average net worth of $14.5 million.

According to research conducted by the Consumer Federation of America, approximately one-third of U.S. households are worth more than $1 million - putting the Senate just slightly ahead of the national curve.

The CFA found in 1999 that the typical American household had net financial assets of less than $1,000, and a report issued by CFA this past May estimated that a stunning 25 percent of U.S. households have net assets of less than $10,000 and were thereby considered "wealth-poor."

The general educational, professional and demographic profile of most Senators appears to make them destined for great wealth. Studies have shown that those reaching millionaire status tend to be older, have graduate or professional degrees and earn more than $100,000 and, not surprisingly, that one's net worth tends to increase with age.

In 1994, only 28 Senators reported holdings worth more than $1 million. That number grew to 34 in 1996.

In all, a total of 26 Senators can claim the title of multimillionaire, and at least 10 Senators are worth $10 million or more.

Kerry and Kohl topped the list with a net worth on paper of at least $139 million in Kerry's case, and $113 million in the case of the Wisconsin Democrat.

But other sources of information about their wealth indicate that they are likely worth several hundred million more.

Kerry, for instance, topped Roll Call's annual survey of the 50 richest Members of Congress earlier this year, with an estimated net worth of $675 million, thanks to his ketchup heiress wife, Teresa Heinz.

When Heinz was booted off Forbes magazine's list of the 400 wealthiest Americans in 1999, her fortune was estimated at $620 million, narrowly missing that year's cutoff of $625 million.

Kohl - who owns the Milwaukee Bucks NBAfranchise and derives his fortune from his family's department-store business - is likely to have far more than the mere $113 million estimate revealed by his financial disclosure statements. He weighed in fourth in Roll Call's 50 Richest survey, with close to $300 million.

Such discrepancies can be attributed to the broad ranges for disclosing the value of assets on financial disclosure statements, which often result in assets being greatly undervalued when determining a Member's net worth.

For instance, in estimating the value of their assets - be it a rental property or mutual funds - lawmakers must mark a range of values such as $15,001-$50,000, $100,001-$250,000 or $1,000,001-$5,000,000. The cutoff is "over $50,000,000," meaning that a lawmaker with property worth $100 million would only have to disclose the asset at the $50 million or above level.

To give lawmakers the benefit of the doubt, Roll Call employs a formula that estimates the net worth by combining minimum assets with minimum liabilities.

Even so, one thing is clear: Nearly half of the Senate is extremely rich.

Of the 40 millionaires, 23 are Republicans and 17 are Democrats. Seven are female.

However, thanks to folks such as Kerry and Kohl, the Democrats have a higher average net worth.

The average net worth of a Senate Republican was about $2.9 million, whereas the average Democrat's net worth was nearly $11 million.

In addition to Kerry and Kohl, the top 10 wealthiest Senators include Sen. Jon Corzine (D-N.J.), who showed a paper net worth of at least $94 million but whose fortune is probably closer to about $400 million. Corzine, who was elected in 2000 after spending about $65 million of his own money on his Senate race, is the former chairman of Goldman, Sachs & Co.

According to his 2001 financial disclosure forms, Corzine sold off much of his Goldman Sachs holdings - somewhere between $26 million and $126 million worth of stock - through a blind trust that he established last March to avoid any potential conflicts of interest.

Among the other top 10 richest Senators were: Jay Rockefeller (D-W.Va.), with at least $82 million; Lincoln Chafee (R-R.I.), who has a minimum net worth of $54 million; Dianne Feinstein (D-Calif.), who is worth at least $38 million on paper; and Peter Fitzgerald (R-Ill.), a former investment banker who has more than $25 million in assets.

Rounding out the top 10 were Sens. Bill Frist (R-Tenn.), a former heart surgeon with a net worth of at least $17 million; John McCain (R-Ariz.), who married into money and is worth at least $14 million; and John Edwards (D-N.C.), a former trial attorney who wisely invested his court winnings and is now worth at least $13.6 million.

Other Senators showed a bit of a decrease in wealth, demonstrating that financial difficulties can strike even the most well-heeled individual.

Sen. Maria Cantwell (D-Wash.), once estimated to be worth as much as $40 million thanks to her stock in the Seattle software company RealNetworks, saw her fortune scaled back over the past couple of years.

In 2000, Cantwell knocked off incumbent Sen. Slade Gorton (R) after cashing in on her RealNetworks stock options and plunking more than $6.5 million of that money on her campaign.

But after taking office, RealNetworks' stock value plunged and Cantwell's fortune has never fully recovered, especially because she has been paying off a number of personal and campaign loans.

Her 2000 financial disclosure forms revealed a net worth of about $10 million, but this year, between her assets and liabilities, Cantwell is worth approximately $3.5 million.

The "poorest" of the Senate's 100 lawmakers is Sen. Tim Hutchinson (R-Ark.), who listed only $2,000 in assets and $15,000 in liabilities, giving him a net worth of minus $13,000.

The rest of the bottom five in terms of Senate wealth were Conrad Burns (R-Mont.), Max Cleland (D-Ga.), Robert Torricelli (D-N.J.) and Patrick Leahy (D-Vt.).

Excluded from the survey were Sens. Jesse Helms (R-N.C.) and Fritz Hollings (D-S.C.), who both filed extensions and plan to file their financial disclosure forms at a later date.

-- (roland@hatemail.com), June 20, 2002

Answers

This is interesing and a little appalling (John McCain and DiFi support campaign finance "reform") but I wish they would also provide a simple ranking of all 100 senators, top to bottom.

-- (roland@hatemail.com), June 20, 2002.

"According to research conducted by the Consumer Federation of America, approximately one-third of U.S. households are worth more than $1 million - putting the Senate just slightly ahead of the national curve."

One-third seems improbably high, even if market value of homes was included in household worth formula.

-- David L (bumpkin@dnet.net), June 20, 2002.

Agreed David. I seem to recall the national average family annual income being pegged at about 30K or so.

Of course, the millionaire figures may have been skewed by inflated stock values in 1999, the only year I see mentioned. Nor can I figure out how that figure meshes with their finding that The CFA found in 1999 that the typical American household had net financial assets of less than $1,000, or their figures which estimated that a stunning 25 percent of U.S. households have net assets of less than $10,000 and were thereby considered 'wealth-poor.'

Of course there are lies, damned lies, and statistics.

-- Uncle Deedah (unkeeD@yahoo.com), June 20, 2002.

According to this CFA link, the average household is worth $1000.00, not $1,000,000. Come on Roll Call, I thought you guys had your shit together.

-- (lars@indy.net), June 21, 2002.