David Frum

08.15.12

How Did Harry Reid Get Rich?

Senator Harry Reid's suggestion that Mitt Romney paid no taxes for ten years generated an unsurprising uproar, one magnified when Reid refused to reveal the anonymous source of his allegation.

Reid might come to regret playing fast and loose with this accusation, as it has attracted media scrutiny to his own personal wealth. Betsy Woodruff at the National Review Institute cataloged multiple examples of Reid's investment strategy. No matter the style and circumstance, this strategy is centered on Reid using his power as an elected official to his personal financial advantage:

When his 2010 challenger Sharron Angle asked him in a debate how he had become so wealthy, he said, “I did a very good job investing.” Did he ever. On December 20, 2005, he invested $50,000 to $100,000 in the Dow Jones U.S. Energy Sector Fund (IYE), which closed that day at $29.15. The companies whose shares it held included ExxonMobil, ChevronTexaco, and ConocoPhillips. When he made a partial sale of his shares; on August 19, 2008, during congressional recess, IYE closed at $41.82. Just a month later, on September 17, Reid was working to bring to the floor a bill that the Joint Committee on Taxation said would cost oil companies — including those in the fund — billions of dollars in taxes and regulatory fees. The bill passed a few days later, and by October 10, IYE’s shares had fallen by 42 percent, to $24.41, for a host of reasons. Savvy investing indeed.