The Rangel scandal deepens

By Thomas Lifson

Charles Rangel, a man who writes federal tax laws as head of the House Ways and Means Committee, not only failed to pay taxes on income he received from a luxury resort property he owns, he financed the purchase with an interest-free loan from a campaign backer who is also a politically active lawyer.

David Kocieniewski and David M. Halbfinger report in the New York Times:

Representative Charles B. Rangel paid no interest for more than a decade on a mortgage extended to him to buy a villa at a beachfront resort in the Dominican Republic, according to Mr. Rangel's lawyer and records from the resort.

The loan was given to him by the resort development company, in which Theodore Kheel, a prominent New York labor lawyer, was a principal investor. Mr. Kheel, who has given tens of thousands of dollars to Mr. Rangel's campaigns over the past decade, had encouraged the congressman to be one of the initial investors in the project. [....]

Although Congressional ethics rules require that members report all gifts and gratuities they receive on an annual financial disclosure form, Mr. Rangel did not disclose the developer's decision to forgive the interest. Mr. Davis said that Mr. Rangel was not required to report it as a gift because the congressman did not receive any special treatment, because the other six Pioneers received the same terms.

Mr. Davis and officials from the resort declined to name the other Pioneers.

"Pioneers" refers to the early investors in the project. No doubt having someone as prominent and politically influential as Rangel as an investor had some value top the project. But he was still receiving a gift and failed to report it.

Does a very prominent politically-connected labor lawyer like Kheel count as a lobbyist? Certainly he has influence on politicians like Rangel, even if he doesn't register himself as a lobbyist.

I credit the NYT with reporting this matter. But why is a story about the man who writes our tax law relegated to the "New York/Region" section of the paper. Rangel is a national politician because his actions affect every single American.

The question answers itself. Jack Abramoff was enough of a scandal to bring down GOP representation in Congress single-handedly. If Rangel becomes the symbol of Democrat corruption, the consequences could be severe. Thus, Nancy Pelosi wants to refer this to a House Ethics Investigation, where it can be buried until after the election.

Hat tip: Ed Lasky