Sen. Harry Reid (D-NV) "collected a $1.1 million windfall on a Las Vegas land sale even though he hadn't personally owned the property for three years," the AP reports.
Except that's wrong. Reid made a $700,000 profit on the sale, not $1.1 million. Also, the story, by the AP’s John Solomon, makes it sound as if Reid got money for land he didn't own. But that's not the case.
It’s not the first time that Solomon has published a misleading story about Reid. This is the third such story by Solomon over the past six months. Each time, Solomon has hit Reid for taking actions which might create the appearance of ethical impropriety. But because Solomon writes for the most powerful news organization in the land, these very gray-shaded stories pack a wallop. It doesn’t help that on numerous occasions, he has missed or distorted key details – missteps that help blow up his stories.
This story is no different. It purports to show that Reid collected $1.1 million on the sale of land he didn’t own.
Yet, as Solomon obliquely acknowledges, Reid, who had bought the land along with a friend in 1998, transferred his ownership in the land to a limited liability company in 2001. The company, which was composed solely of this land owned by Reid and his friend, in turn sold the land in 2004. That's when Reid collected his $1.1 million share of the sale. Since Reid had originally put down $400,000 on the sale, his profit was $700,000, not the full $1.1 million, as Solomon states in his lead.
Solomon persists in straightforwardly describing the 2001 land transfer as a sale, even though no money changed hands; Reid's share of the land after the transfer was the same as before. In his financial disclosure forms, Reid did not disclose his transfer of the land to the LLC, although he did continue to disclose his ownership of the land through 2004, when it was sold.
So what's the story here? Well, it's not clear that Reid broke any ethical rules -- let alone any laws. Solomon cites one expert as saying that Reid should have disclosed the transfer to the LLC, because "
hether you make a profit or a loss you've got to put that transaction down so the public, voters, can see exactly what kind of money is moving to or from a member of Congress." The thing is, of course, that no money moved in the LLC transaction. Reid still owned the same amount of land - it was just under the cover of the LLC.
Now, members of Congress should go out of their way to avoid the appearance of impropriety. The purpose of financial disclosure is for the public to gauge whether lawmakers might run into a conflict of interest. By that higher standard, Reid should have disclosed his involvement in the LLC. And although Solomon is unable to make any specific allegations of wrongdoing, the informality of the LLC arrangement is potentially open to abuse. Reid's office, in a statement on the matter, says they're willing to go back and make such "a technical correction" to the financial disclosures if the Ethics Committee sees fit. One wonders why they don't go ahead and make the correction anyway so as to be above reproach.
That said, let's put this in context.
On two earlier occasions, Solomon has over-inflated his stories on Reid. TPM readers might remember his expose on Reid's involvement with Jack Abramoff (which, after exhaustively detailing an Abramoff’s associate’s contacts with Reid’s office, failed to mention that Reid didn't vote the way Abramoff wanted him to) and his stories on Reid's acceptance of passes to a boxing match from the Nevada Gaming Commission (which managed to expunge a host of mitigating details too plentiful to name here).
There's an old saying in journalism that three examples make a trend. I think we have a trend here. Solomon’s apparent weakness for detail is one issue. But most curious is the fact that we live in the muckiest times in recent memory, and yet Solomon, at the helm of the most powerful news agency in the country, persists in roaming the wide ocean of Congressional corruption in a Captain Ahab-like hunt for Reid's ethical missteps.
http://www.tpmmuckraker.com/archives/001782.php
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