You don’t have to tell Sen. Joe Lieberman that Wall Street can be risky these days. The Connecticut Independent reported losing nearly $188,000 of campaign money in the stock market during the last two and a half years.
It is unknown how many campaigns are currently playing the stock market with their contributors’ money, though some 1,500 committees have cash on hand and there are no rules preventing them from investing it for profit.
The Federal Election Commission only requires candidates to disclose the amounts and dates for campaign transactions and the financial institutions involved, but it is not always clear that the payments are investments. The agency does not instruct campaigns to list individual stocks, bonds or other securities.
Lieberman’s losses consist of diversified funds and holdings in more than 150 companies during the last two and a half years.
“Just like many Americans do, Friends of Joe Lieberman has invested its funds in a variety of ways, some of which are subject to market fluctuations,” Sherry Brown, deputy treasurer of Friends of Joe Lieberman, said in a written statement. “As the committee draws down its assets in the coming years, we expect to see a positive return on our total investments.” Lieberman has announced he will not run for re-election next year.
Some of the companies listed on Leiberman’s disclosure forms include a few of the top 10 contractors for the Department of Homeland Security, such as IBM, Boeing Co. and General Dynamics Corp. Lieberman is chairman of the Homeland Security and Governmental Affairs Committee, but Brown said specific investment decisions are not made by the Senator, which removes potential conflicts of interest.
“Investment decisions are made by a fund manager, and the majority of the contributions are invested in mutual funds — not in individual stocks,” Brown said. “As always, Friends of Joe Lieberman scrupulously follows all campaign laws and regulations.”
While Lieberman’s campaign lost thousands of dollars since 2009, Sen. Charles Schumer made more than $1.3 million through interest and capital gains by investing his campaign contributions — the most of anyone in Congress whose investments can be tracked.
The old adage that “it takes money to make money” applies aptly to the New York Democrat, who started his 2010 cycle with almost $10.6 million in cash on hand and made profits equal to more than 12.3 percent of that initial sum over the next two and a half years.
FEC documents state only that these new receipts came from a combination of “interest” and “capital gain,” offering no details on which investments Schumer’s campaign did so well with in the market.
“The earnings are mostly via investments in corporate bonds and CDs,” said an aide to Schumer who could not rule out whether a small amount of money was invested in stocks. “The campaign’s rule is to invest in safe products that don’t have extreme highs or lows.”
Vice President Joe Biden waits to conduct a mock swearing-in ceremony with Sen. Brian Schatz, D-Hawaii, in the Capitol's Old Senate Chamber, December 2, 2014. Schatz was sworn in to serve the remainder of his term since he was appointed to the seat after Sen. Daniel Inouye, D-Hawaii, passed away.