The Daily Item, Sunbury, PA

News

October 8, 2012

Members of Congress Avoided Recession's Worst

(Continued)

In 2004, the catalogues were worth $765,000 to $1.8 million and generated at least $385,000 in royalties, records show. By 2010, their value had fallen to between $250,000 and $500,000, and royalties fell to at least $106,000.

The economic meltdown was particularly tough on members of Congress who were already struggling with their personal finances.

Rep. Rubén Hinojosa, D-Tex., is the only member of Congress known to have filed for personal bankruptcy after the financial crisis. In 2007, his family's longtime food processing plant in Mercedes fell on hard times. As the economy shrank, the plant was unable to secure credit. "It took a turn for the worse during the financial crisis," he said in an interview.

Hinojosa had not been active in the business operations for many years, but he had guaranteed a company loan. In 2010, his family closed the business and he was held liable for millions of dollars in losses. His estimated wealth fell dramatically between 2004 and 2010, the year he filed for bankruptcy, citing debts that range between $1.4 million and $5.9 million, the largest owed to Wells Fargo.

For years, Rep. Alcee L. Hastings, D-Fla., has been one of the most financially distressed members of Congress. He reported debts of between $2 million and $7 million in 2010. The debt is due to legal fees he incurred in the 1980s when he was a federal judge and accused of accepting bribes. A jury acquitted Hastings, but Congress impeached him.

"I paid some of them along the way," Hastings said of the legal fees in a recent interview. "I wish I could just hit the lottery so I could pay them all."

He said the lawyers would give him affidavits forgiving the debt if he requested it, but "what the accountants say to me is that then I would have a tax consequence."

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