Very few men can wield a gavel like Rep. Charles Rangel, the chairman of the House Ways and Means Committee, which has jurisdiction over tax law.
The Harlem Democrat has run into some ethical headaches recently, but a broader look at his 18-month tenure atop the powerful House panel shows a man who knows how to leverage his power, line his campaign coffers, and foster support among powerful players in the business world.
While the late Republican majority was hardly a paragon of good government — corruption and bribery scandals were at the heart of the GOP’s fall in 2006 — Rangel’s Ways and Means chairmanship has been a fundraising bonanza, with much of the money coming from donors with dire business before Rangel’s panel.
Now Republicans, eager to attach some ethical stain to the Democrats before the midterm elections in which the GOP is sure to lose seats, are calling on Rangel to step down as chairman. House Republicans point to Rangel’s recent ethical problems, including: many years in which he didn’t pay taxes on rent he received at his villa in the Punta Cana Yacht Club in the Dominican Republic; his use of congressional stationery to raise money for his “monument to myself,” a “center for public service” named after him; and his four rent-controlled apartments in one Harlem building, from which he saves thousands of dollars each month.
The chairman’s gavel has been something of a fundraising magic wand for Rangel. In the 2000, 2002, 2004 and 2006 election cycles, Rangel raised about $1.9 million every two years. So far this cycle, he has already more than doubled that pace.
Rangel has raised more than $4.6 million since he was catapulted to the chairmanship. While the gentleman from Harlem is fond of using class-warfare tactics and tarring the GOP as the party of the rich, no Republican Ways and Means chairman has ever raised such sums.
Rangel’s $4.6 million — in not even a full election cycle — is more money than the total raised by the last GOP chairman of Ways and Means, Rep. Bill Thomas, R-Calif., during his entire six years chairing the committee, plus the total raised by Thomas’ predecessor, Rep. Bill Archer, R-Texas, during his time as chairman.
In other words, Rangel has raised more money in 18 months than Republican tax chairmen raised in 12 years.
Nearly half ($2 million) of Rangel’s money comes from political action committees, according to the Federal Elections Commission.
For example, the Altria Group — formerly Philip Morris — has given him $7,000. American Express’ PAC has donated $10,000 to Rangel, and Boeing’s PAC has given $9,000. Fannie Mae’s PAC has given him $7,500, while Freddie Mac’s PAC has contributed $2,000.
These are all companies dependent on Washington’s good favor, and all dwell in interesting corners of the tax code, where a tweak here or a tweak there can mean hundreds of millions.
If his acceleration in fundraising isn’t evidence enough that Rangel has turned his chair into a fundraising tool, the Baucus-Rangel Leadership Fund should be a tip-off. One month into the new Democratic majority, Rangel formed a joint fundraising committee with Democratic Sen. Max Baucus of Montana.
What do the two have in common, aside from the fact that there is a Harlem, Mont.? Baucus is chairman of the Senate Finance Committee, the upper chamber’s tax-writing committee. What would be the purpose of a joint fundraising committee controlled by the two lawmakers with the most control over tax law?
Sure enough, the donor list is plush with developers, financiers and wealthy businessmen with interesting tax situations. Take, for example, Richard G. Vento, who contributed $4,400 to the Baucus-Rangel Leadership Fund.
Vento lists his address as the Virgin Islands, which allows him to mostly avoid paying federal taxes. The New York Times reported in November that Vento was under audit by the IRS. Rangel, after the donation from Vento, pushed a provision that would halt some ongoing audits of Virgin Islands businessmen by shortening the statute of limitations, so to speak, on audits.
Vento is not alone among Rangel’s Virgin Island donors. Rangel appears to have held fundraisers for such donors on May 17 and May 18, 2006, as on those two days, Rangel received 30 separate donations from donors in the Virgin Islands, adding up to $44,000.
When asked last October what tax laws he would change and what expiring tax cuts he would want to preserve, Rangel gave the shrewd answer: “I have to say everything is on the table.” And Chairman Rangel is open-minded enough to give everyone a seat at that table — for a price.
Examiner columnist Timothy P. Carney is editor of the Evans-Novak Political Report. His Examiner column appears on Fridays.
