PACs for Profit

60 Minutes recently ran a story on Congress’ use of ‘slush funds’ for personal profit, just one more element to that bipartisan cesspool.

One of the prevalent themes in the piece involves a congress member ‘loaning’ their campaign their own personal money, but charging their campaign funds ‘interest’, effectively siphoning money from their campaign funds into their personal accounts.

Here’s Steve Kroft’s encounter with Rep. Grace Napolitano (D-CA), who’s profited over $294,000 since 1998 by loaning her congressional campaign money at interest rates up to 18%:

After weeks of trying to get an interview with Congresswoman Napolitano, we finally cornered her outside a meeting of the Hispanic Caucus. She told us that as a woman and a minority, banks wouldn’t lend her money, so she had to she withdraw $150,000 from an investment account to lend it to her campaign.

Steve Kroft: You loaned money to your campaign and then charged the campaign 18 percent interest?

Grace Napolitano: That is correct.

Grace Napolitano: To be able to do a lot of the things I had to do were not feasible unless I did what I had to do. And so at that point, that’s what was recommended, and that’s what I went with.

Steve Kroft: I don’t think there’s anything wrong with loaning your campaign money. But then collecting 18 percent interest from your campaign seems a little too much.

Grace Napolitano: Would you go out and get a loan and not get charged interest?

Steve Kroft: It’s still 18 percent and $228,000 in interest.

Grace Napolitano: You like to favor 18 percent.

Steve Kroft: I do like to favor. I mean, that’s what the Mafia gets.

Grace Napolitano: It isn’t like I’ve really profited. I still live in the same house. I drive a small car. I am not a billionaire, or a millionaire, for that matter.

Steve Kroft: Did your campaign contributors know that you were paying back a loan, charging the campaign committee 18 percent?

Grace Napolitano: Well, you don’t go out and publicize that, but they know that I had a campaign debt.

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