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elections

The Goliath$ . . . and the David$

October 19, 2003

BY SCOTT FORNEK Political Reporter

One millionaire's fortune is another's chump change.

Six of the 15 Illinois Democrats and Republicans officially in the running for the U.S. Senate are millionaires, but only three claim deep enough pockets to pay for their entire campaigns without wiping out or seriously depleting their fortunes.

The richest of the bunch, Democrat M. Blair Hull, is so flush that the $11.6 million to $42.3 million in dividends, interest and other investment income he gets each year rival the entire net worth of some of the other millionaire candidates.

Republican Jack Ryan isn't doing too badly, either. The former investment banker supplements the $21,717 he makes annually to teach at an inner city high school with annual investment income of $1.8 million to $7.9 million.

Republican state Sen. Steve Rauschenberger is far from a millionaire, so he supplemented his state paycheck with $10,500 in consulting fees from a public affairs firm that includes lobbying among its services. Rauschenberger defends the payments as ethical.

"They were not lobbying the state, and I did not work in any capacity related to lobbying," Rauschenberger said. "It's on the up-and-up. It's within our ethics laws."

Those are some of the highlights of ethics statements filed by candidates vying to succeed Republican Sen. Peter Fitzgerald. The public financial disclosure reports detail each candidate's investments, salaries and other income in order to help expose conflicts of interest.

They also give a glimpse into the candidates' wallets by requiring them to provide broad ranges of the values of their holdings and earnings. It's impossible to get an exact figure because the politician can check off categories as wide-ranging as "between $5,000,001 and $25,000,000" for specific assets, but by tallying up the ranges a rough picture emerges of who's got it and who doesn't.

And this time around, there are plenty who've got it. Altogether, the six millionaires in the race have a combined net worth of somewhere between $212 million and $692 million.

"It's going to be like the Christmas gift in the Neiman Marcus Christmas catalog this year -- U.S. Senate seat," said Cindi Canary, executive director of Illinois Campaign for Political Reform. "It would be an interesting kind of psychological profile, that at a certain level of financial success and professional success the U.S. Senate is just seen at the next place to go."

From Las Vegas to Senate?

The de facto chairman of the millionaires club is Hull, 61, a first-time candidate who has said he plans to pump as much as $40 million of the money he made as a trader and investor into his campaign.

Like all the wealthy candidates, Hull dismisses any suggestion he is trying to buy the seat. But he can certainly afford it. Even if he loses, that missing $40 million won't leave him penniless.

"Well, I think I might be able to buy dinner," Hull quips.

Hull, who was on food stamps back in 1967 after a hitch in the U.S. Army, has a net worth of somewhere between $131.9 million and $444.4 million. It's probably closer to the high end because he parlayed $25,000 in blackjack winnings into the Hull Trading Co., which he and his partners sold for $531 million in 1999. Hull owned 64 percent of the firm, so his before-taxes take was nearly $340 million.

"It's about a lot more than money," Hull said. "It's about who can provide the leadership, who has the record of challenging the status quo and who has the record of getting things done. But you can't challenge the status quo unless you're independent of special interests."

But how can voters be sure Hull won't be more concerned about casting votes in the U.S. Senate that help his portfolio, rather than his constituents?

He is a partner in 14 different investment firms with shares of more than 1,700 companies. They invest in everything from office buildings in Poland to a waste-hauling firm in Hackensack, N.J. But Hull argues that 95 percent of his money is invested in highly diversified funds.

"I have what is considered a passive investment strategy," he said. "I have mainly index funds. I spend literally zero amount of time on my investment portfolio. . . . And clearly, it will go into a blind trust when I am elected."

Who else has a winning hand?

But Hull is not the only millionaire on the Democratic side of the race. Health care consultant Joyce Washington reported a net worth between $946,188 and $4.4 million -- the lion's share of it in investment income.

That's good money, but it's not enough to cover the entire cost of the race, which could be upward of $15 million.

Six years ago, Fitzgerald spent $12 million of his own money on the campaign.

Besides Hull, the only two candidates who say they could easily part with that kind of cash are Republicans Ryan and Dr. Chirinjeev Kathuria.

Ryan, 44, who quit his job at Goldman Sachs to teach at Hales Franciscan High School, is worth between $37.9 million and $96 million. He has already spent $1.2 million of his own money on his campaign, but is not planning on paying it all himself.

"We've already raised $500,000 in just three months' time," Ryan said. "I'm really a believer that to make it an effective campaign you've got to get people helping you besides yourself."

Kathuria, 38, says he made his fortune by investing in European Internet service providers, MRI medical diagnostic imaging firms and other high-tech companies. He has not yet filed his disclosure report. A published report has raised questions about Kathuria's business success. But in an interview with the Chicago Sun-Times, he said he is worth between $30 million and $100 million. In another media interview, he put the figure at $100 million.

Kathuria says he would have to sell off his shares of his businesses to get the cash to self-finance. Instead, he hopes to spend only $1.5 million of his own money on the primary and raise an additional $1.5 million from Indian Americans and others in the Asian community.

"If I win the primary, I'll do whatever is needed to win," Kathuria said. "If I had to sell everything and be left with a couple of million dollars, I would do it."

Dairy and investment magnate Jim Oberweis, 57, might be able to completely self-finance his GOP campaign, but not without doing serious damage to his nest egg, which is worth somewhere between $7.6 million and $33.4 million.

He and the remaining GOP millionaire, Andy McKenna Jr., are both spending a lot of time trying to raise money from others.

McKenna, 46, president of Schwarz Paper Co., is the wealthy candidate most dependent on outside contributors. Trying to completely self-finance would wipe out his fortune at best and be impossible at worst.

Making ends meet

Some of the non-millionaires find ways to raise extra cash. State Sen. Barack Obama, for example, supplements his $66,471 annual state salary with a $69,750-a-year job lecturing at the University of Chicago Law School.

But Rauschenberger appears to be the only candidate taking money from a firm that includes lobbying among its services. He reported supplementing his $66,389 state salary last year by taking $10,500 in consulting fees from Midwest Public Affairs Group, a Chicago firm whose services include lobbying, public relations work and political consulting.

Rauschenberger says the firm did not lobby the state at the time. It does lobby on the federal level. He said his work was limited to preparing position papers on sales tax issues and helping the firm identify potential clients needing help in organizing people around issues.

"It helped with the first two tuition payments for my second son in college," Rauschenberger said.

Rauschenberger said he has not worked for the firm for more than a year, but he was listed as counsel for the firm on the company's Web site until the Sun-Times began asking questions about the fees.

"We requested about two weeks ago that they take that off," he said. "It has nothing to do with my role as a state legislator or potentially my role as a U.S. senator. . . . And we certainly won't work for them again."

Ethics watchdog Canary accepted Rauschenberger's explanation.

"If in fact it is the case they were not lobbying [the state at the time], and he is not involved in that in any way, and it is more of a research role, and everything was reported, I would think he is OK," she said.

As for the stampede of millionaires, Canary was careful.

"The U.S. Senate, I don't think anyone is surprised to learn, is made up of millionaires," she said. "I don't think that necessarily always serves us very well in terms of being truly representative of the people. . . . The danger here is if we come to think of the U.S. Senate as a place that only millionaires can run for. It certainly cuts off the vast majority of people in this country.

"That said, we have to remember that in the scheme of things, it isn't always the self-financing candidate who wins. We have had a number of candidates who spend big money and fail."


M. BLAIR HULL
Democrat
Investor
Age: 61


Net Worth
$131,939,081 to $444,478,000


Investment income
$11,595,556 to $42,308,101


Total income
$11,762,556 to $42,391,601

DR. CHIRINJEEV KATHURIA

Republican

Businessman

Age: 38

Net Worth

$30 million to $100 million

Total income

$1 million to $3 million

JACK RYAN

Republican

Investment banker-

turned teacher

Age: 44

Net Worth

$37,947,873 to $95,995,832

Investment income

$1,807,890 to $7,894,055

Total income

$1,864,607 to $7,950,772

JIM OBERWEIS

Republican

Dairy and investment

magnate

Age: 57

Net worth

$7,633,015 to $33,445,000

Investment income

$1,632,336 to $1,647,133

Total income

$1,882,336 to $1,897,133

ANDY MCKENNA JR.

Republican

President of paper company

Age: 46

Net worth

$3,804,027 to $14,236,000

Investment income

$425,260 to $539,150

Total income

$1,511,219 to $1,625,109

JOYCE WASHINGTON

Democrat

Healthcare consultant,

investor

Net Worth

$946,188 to $4,439,186

Investment income

$130,663 to $1,125,300

Total income

$211,272 to $1,205,909

GERY CHICO

Democrat

Lawyer, former school board

president

Age: 47

Net Worth

$172,011 to $530,000

Investment income

$5,001 to $17,000

Total income

$526,901 t0 $538,900

DAN HYNES

Democrat

State comptroller

Age: 35

Net Worth

$67,004 to $184,000

Investment income

$45,204 to $152,000

Total income

$160,636 to $267,432

STEVE RAUSCHENBERGER

Republican

State senator

Age: 47

Net Worth

$6,006 to $90,000

Investment income

$1,202 to $4,700

Total income

$78,091 to $81,589

NANCY A. SKINNER

Democrat

Radio personality

Net Worth

$1,001 to $15,000

Investment income

$0 to $200

Total income

$67,359 to $67,559

MATTHEW O'SHEA

Democrat

Mayor of Downstate

Metamora, businessman

Net Worth

$2,002 to $30,000

Investment income

$0

Total income

$143,020

BARACK OBAMA Net Worth Investment income Total income

Democrat Age: 42 $115,003 to $250,000 0 to $600 $136,221 to $136,821

State senator, lecturer

VIC ROBERTS

Democrat

Retired coal miner

Age: 70

Net Worth

Less than $1,000

Investment income

$200 or less

Total income

$200 or less

Note: Among Republicans, retired Air Force Maj. Gen. John L. Borling, former state Rep. Jonathan Wright and Dr. Chirinjeev Kathuria have officially launched their campaigns, but have not yet filed their Public Financial Disclosure Reports with the U.S. Senate. (Kathuria provided some information in an interview with the Chicago Sun-Times.) Among Democrats, Cook County Treasurer Maria Pappas, former Lt. Gov. Corinne Wood and state Sen. Patrick O'Malley are potential candidates, but they have not officially entered the race.





 
 












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