Monday, September 19, 2011


Estimated net worth: $5 million

Obama is the grandson of a goat herder. He is a former constitutional law professor and civil rights attorney. Book royalties constitute most of Obama's net worth.

Most presidents put their investments into blind trusts when taking office to avoid the appearance of conflicts of interest. President Obama didn’t do that, in the name of transparency of course.

For Obama, lack of huge stock portfolio helps avoid need for blind trust

He's the ultimate public official. And public officials put their money in blind trusts, right? It's a way of getting around the whole "conflict-of-interest, don't want the appearance of impropriety" thing.

In fact, President Obama has rejected the approach taken by most of his predecessors in the modern era.

His personal wealth -- which is rapidly growing -- is not shielded from his view.

Why not?

Officially, the answer is that the president wanted more transparency in his personal finances -- fitting in with his pledges to be the most open White House in history.  [EDITORIAL NOTE:  ROFLMAO!]

"The choice not to have a blind trust is an effort to be transparent about where his money is kept, and the public can see his latest financial disclosure documents, which we have made public and accessible on the Web site," a senior White House official said. But a little digging into Obama's financial disclosures suggests another answer.

According to documents Obama filed in May of 2009 (another round is due next month), most of the first family's money is invested in plain vanilla U.S. Treasury bonds. Those are the kinds of low-yield investments that are unlikely to provoke any conflict of interest concerns.

Kenneth A. Gross, a lawyer at Skadden Arps, is a key adviser to uber-wealthy New York Mayor Michael Bloomberg. He said in an interview that Obama has no need for a blind trust.

"I think it's an instinctive thing -- oh you are in public office now, you should set up a blind trust," he said. "You can avoid a blind trust fairly easily by putting money into investments such as a widely diversified fund."

Gross, who said Bloomberg has largely avoided putting his billions into a blind trust, said Obama does not own hundreds of individual stocks that could be bought and sold, causing him to recuse himself on numerous issues.

"There's no blessed reason why you would set up a blind trust for that kind of investment," Gross said of Obama. "He's got his money in exactly the kinds of investments that don't require a blind trust."

In theory, Obama is the one man in the country (along with Federal Reserve Chairman Ben S. Bernanke) who could affect interest rates, and thus the value of his Treasury bonds. But Gross said that's a stretch.

Melanie Sloan, the executive director of Citizens for Responsibility and Ethics in Washington, said she tends to favor blind trusts for most politicians.

"The blind trusts are necessary so it's clear to other people that you are not making decisions that affect your own financial interests," she said. "They get in trouble all the time when they are making decisions that make their own stock portfolio worth more."

1 comment:

  1. Melanie Sloan serves as CREW's Executive Director and is a nationally recognized expert on congressional ethics. Prior to starting CREW, she served as an Assistant United States Attorney in the District of Columbia where, from 1998-2003, she successfully tried cases before dozens of judges and juries.
    Before becoming a prosecutor, Ms. Sloan served as Minority Counsel for the House Judiciary Committee, working on criminal justice issues for then-Ranking Member John Conyers (D-MI).
    Ms. Sloan also served as Counsel for the Crime Subcommittee of the House Judiciary Committee, chaired by then-Representative Charles Schumer (D-NY).
    There, she drafted portions of the 1994 Crime Bill, including the Violence Against Women Act. In 1993, Ms. Sloan served as Nominations Counsel to the Senate Judiciary Committee, under then-Chairman Joseph Biden (D-DE).
    Prior to working for the Congress, she was an associate at Howrey and Simon in Washington D.C