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Josh Marshall

Josh Marshall is editor and publisher of TalkingPointsMemo.com.

Articles by Josh

Many of you will already have noticed the story in the LA Times about the bonanza Sen. Stevens (R) pulled off in his own real estate deal. Says the lede of the Times piece: "Sen. Ted Stevens (R-Alaska) made $822,000 last year from the sale of a controversial real estate investment with an Anchorage developer who had obtained a huge federal contract with his help."

This and the CunningScam story led one TPM Reader to suggest that it may not be low interest rates so much as high-rolling Republican members of Congress who are responsible for the nation's real estate boom.

TPM Reader BL helpfully sends in this list of what other members of Congress failed real estate speculator Mitchell Wade gave money to.

I guess in the case of Mr. Wade we should make clear that the aforementioned list is of political contributions rather than personal cash gifts.

Just wanted to be clear ...

(ed.note: Scanning the list, looks like all Republicans from the House. But there is that $2,000 contribtion to "Rockefeller, Jay". Hmmm.)

TPM scoops local paper on CunningScam story!

In this morning's paper, The San Diego Union-Tribune reports what TPM reported last night -- that the broker (and her family) who arranged for defense contractor Mitchell Wade to buy Rep. Cunningham's house for that inflated price has been a Cunningham campaign contributor to the tune of $11,500.

That said, the Union-Tribune story by Marcus Stern -- who broke the story on Sunday -- is excellent and nails down pretty much all the remaining loose ends which might have given any doubt what sort of 'transaction' this really was.

On the key point, was there any reason to believe that the Cunningham house had a fair market value of $1,675,000?

Stern: "A Copley News Service review of the comps for Cunningham's neighborhood during the approximate time of the sale show an array of houses of vastly different sizes and views selling for $700,000 to $1.7 million. This indicates that Todd might have set the price at the high end of the range when she set it at $1,675,000. However, the eight months it languished on the market and its subsequent sale for $975,000 during a seller's market suggest a value closer to the low end, according to real estate professionals interviewed for this article."

I'd say that passage makes Stern almost as generous as our man Mitchell Wade.

Remember, Todd set the value at $25,000 under what was apparently the highest priced home in Cunningham's entire neighborhood. And that was from a list of houses "of vastly different sizes and views." So Todd, it seems, actually went to some lengths to come in just under the laugh test mark. But even then, not really.

Another point to keep in mind, as many readers have reminded us over the last few days, is that the San Diego real estate market has been positively on fire in the last couple years. Indeed, Stern quotes another realtor saying that residential real estate properties were going up about 20% a year at the time this whole scam went down.

So even though the house eventually sold for $975,000 close to a year later, it seems likely that its fair market value at the time Cunningham sold it was well below that.

And one final point from the Stern article in the San Diego paper. As we've noted, real estate agent and Cunningham campaign contributor Elizabeth Todd put together this list of comps to justify the inflated price. As Stern notes, the "next step in a normal arms-length transaction would have been [for the purchasor, i.e., Wade] to have a Realtor or appraiser drive by the houses to see if the house being purchased was more like houses at the upper end of the range or more like houses at the lower end of the range."

But apparently Wade made no effort whatsoever to ascertain if the price he was paying for the house had any relation to its actual value. No other real estate agent, no appraiser, nothing. He went ahead on bought it -- apparently, for cash.

This story leaves little doubt that this thing was all a set-up: Mr. Wade gave Rep. Cunningham an unreported gift of upwards of a million dollars, a transaction to which Elizabeth Todd was almost certainly the knowing, shall we say, handmaiden.

Read Stern's story and see if there's any other way to interpret the facts.

Next, question: what other businesses are the Todds involved in?

More on Elizabeth Todd, the San Diego real estate broker who set the wildly-inflated price which defense contractor Mitchell Wade paid for the then-home of Rep. Randy "Duke" Cunningham (R).

A local paper -- the North County Times -- confirms a detail we've been trying to nail down for much of the day.

As earlier reports have noted, Todd was paid nothing to set that inflated price. But that isn't the end of the story.

Todd was also the agent of record and bagged a nice commission when Wade later resold the house for $975,000 -- a $700,000 loss. More importantly, she was also the agent for the new house that the Cunninghams turned around and bought with the $1,675,000 Wade paid them for their old house. And the new place went for a cool $2,550,000.

Now, I don't know just what sort of commission Todd would have gotten for sales like that. But I figure it would be a tidy sum. And it sounds like a decent incentive to make sure the whole three-way transaction went off without a hitch.

Canned for falsifying data about global warming? Or just reporting back to central command after an assignment in the field?

The lede from AP: "A former White House official and one-time oil industry lobbyist whose editing of government reports on climate change prompted criticism from environmentalists will join Exxon Mobil Corp., the oil company said Tuesday."

Did these three grafs really appear in the Times? (emphasis added)

Social Security now takes in considerably more money than it pays out in benefits. But as legions of baby boomers retire and begin to collect benefits, instead of paying for them, the retirement system will move toward a deficit. Some actuaries have projected that there will be more money going out than coming in by 2017, although full benefits will be payable for some time because of the surplus being accumulated now. But in 2041, Mr. Bush said, the system will be "bankrupt."

Actually, beginning around 2041 the system would be able to pay about three-fourths of the benefits due retirees, assuming there are no changes in the formula before then. Critics of Mr. Bush's proposals have said there are enough ways, and enough time, to fix the system without a drastic change like a shift to private accounts.

The president drew a laugh when, in arguing that big changes are needed, he spoke disparagingly of "the paper i.o.u.'s in a file cabinet in West Virginia" that make up the $1.7 trillion Social Security trust fund. He did not point out those i.o.u.'s are Treasury securities backed by the full faith and credit of the United States, and that the government has never defaulted on its obligations.


Credit where credit is due: David Stout in today's paper. <$NoAd$>Lucky for him Okrent's not around anymore.

Still no real pick up of the Randy "Duke" Cunningham home sale of a lifetime story. But when cruising through Google News we did notice that the Duke has this OpEd in today's USAToday supporting the flag burning amendment.

ACLU Executive Director Anthony Romero has more on the flag burning amendment today at TPMCafe's Table for One and how close it apparently is to passage in Congress.

Yes, I know, a Randy "Duke" Cunningham -- TPMCafe guest-blog harmonic convergence. But, hey, what can we do.

More later on the Duke's adventures in real estate.

Yet another Randy "Duke" Cunningham (R) update ...

San Diego's North County Times has a follow-up on Cunningham's response to the article which appeared over the weekend regarding the questionable sale of his home.

Apparently neither Cunningham or his staff would take calls. But his office did release a statement. And in that statement he cuts to what has to be the central issue: Was $1.675 million a reasonable market value for the house or not?

The fact that it sold again for well under a million dollars less than a year later points strongly to the conclusion that the price was inflated. But was there an appraisal at the <$Ad$>time? And what were the comps?

In his statement Cunningham says: "Mr. Wade was interested in purchasing our home. He received comparables from an independent source establishing the value of the home. He made an offer based on that evaluation. Nancy and I accepted that offer. I have no reason to believe the value of the house was inflated then, and I have no reason to think so today. (emphasis added)"

But other news accounts seem to suggest that the 'independent source' was Elizabeth Todd, who happens to be a major campaign contributor to Cunningham.

Now, just because she gave Cunningham large campaign contributions in the past doesn't mean the comps she assembled weren't legit. And it is probably fair to say that major real estate operators are often contributors to their local member of Congress.

But her independence is certainly open to question.

As far as I know, none of the reports on this question that I've seen have had a look at the actual comps Todd assembled, which suported the $1.675 million purchase price.

Isn't that the next obvious place to go in this story?

We learn today from the Carpetbagger Report that Roll Call has now followed up (sub.required) on the story of Rep. Randy "Duke" Cunningham (R) and the apparent 3/4 million dollar favor he got from a defense contractor with business before two of his committees.

We've been doing some of our own reporting on this. And Roll Call reports one detail we were working: the real estate agent who arranged the deal, though handled it as a non-listed private transaction, also happens to be a major campaign contributor to Cunningham. In the 2001-2 cycle, Elizabeth Todd and her husband donated $3000 to Cunningham's campaign.

And we think there's more still to be told.

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