Eaten Alive by Corruption
The stirring tale of Randy "Duke" Cunningham, congressman and bon vivant, becomes more entertaining by the day, and it is far more instructive than another case of a missing white female.
True, Duke Cunningham is merely an obscure Republican from San Diego (Crow Eaten Here: In a recent column, I said Cunningham was in charge of the House Defense Appropriations Subcommittee, whereas actually he is only a member thereof ... apologies. He is also on the Permanent Select Committee on Intelligence.) On the other hand, the whole tale is so ... so prototypical, so archetypal, so (even though I keep promising not to use the word) paradigmatic.
Cunningham was a decorated pilot in Vietnam who has oft campaigned on the claim that he is the original model for Top Gun. In 2003, he sold his house in Del Mar, a very upscale town north of San Diego. The buyer was Mitchell Wade, a defense contractor, who paid $1.675 million. Wade later resold the house at a $700,000 loss.
Now, either this makes Wade the only person in recent history to lose money on a San Diego real estate deal, or the guy paid way too much for the house.
The deal is now under investigation by a grand jury. Cunningham in turn used the money he made from the Del Mar deal to buy a $2.55 million home in Rancho Santa Fe.
Meanwhile, back in Washington, Cunningham is living, rent-free, aboard a 42-foot yacht named the Duke Stir, which belongs to the said same Mitchell Wade. Since 2002, Wade's company, MZM Inc., has received $163 million in defense contracts.
There the case stood until this week, when we learned from Copley News Service and The Washington Post that the boat-loving Cunningham was living on the Duke Stir only because he had sold his own boat, the Kelly C, a 65-foot flat-bottom riverboat, to Thomas Kontogiannis, a New York real estate developer.
Follow this closely: Kontogiannis buys the boat from Cunningham in the summer of 2002. In 2003, a mortgage company owned by Kontogiannis' nephew and daughter finances $1.1 million of the price of Cunnigham's new home in Rancho Santa Fe. Also, Kontogiannis never gets around to putting the Kelly C in his own name, so the Coast Guard still thinks it's owned by Cunningham. What a misunderstanding.
My favorite quote, so far: Kontogiannis, when asked if he was doing Cunningham a favor by keeping the boat in his name while Kontogiannis paid $100,000 to redecorate it, said: "Why would I do that? I don't need the man." The pragmatic approach.
Kontogiannis does admit that he was looking for a pardon for his unfortunate 2003 conviction on kickback and bribery charges in connection with a bid-rigging scheme for New York City school computers. He said Cunningham steered him to a Washington law firm for this purpose, but it was "too much aggravation."
Cunningham is very big on patriotism and the no-flag-burning amendment. Meantime, MZM is working on classified intelligence projects for the government.
For those who prefer to contemplate varieties of political corruption in a more systemic way, the current issue of Harper's magazine has a cover article on "The Great American Pork Barrel: Washington Streamlines the Means of Corruption," by Ken Silverstein, which I highly recommend.
Silverstein details the ballooning of the practice called "earmarks" in the federal budget. As it is true of much of what is wrong with our politics, the practice is not new — pork barrel politics has a venerable history — but it is spiraling out of control. The same thing has happened with gerrymandering, also an ancient practice, and campaign contributions. They've always been part of politics, it's just that now they are so much more so. Indeed, what have been just deplorable flaws in our system are now eating the system — the flaws are getting bigger than the functioning, with the result that serving the public interest is rapidly disappearing.
Silverstein reports on earmarks: "In the past two decades, the pastime has become breathtaking in its profligacy. ... Last year, 15,584 separate earmarks worth a combined $32.7 billion were attached to the appropriations bills — more than twice the dollar amount in 2001 ... and more than three times the dollar amount in 1998, when roughly 2,000 earmarks totaled $10.6 billion. The process is so willfully murky that abuse has become not the exception, but the rule.
"Earmarks are added anonymously, frequently during last-minute, closed-door sessions of the appropriations committees. An especially attractive feature for those private interests seeking earmarks is that they are awarded on a noncompetitive basis and recipients need not meet any performance standards."
© 2005 Daily Camera