Maybe we're really, really missing something, but does the Washington Post's front-page exposé on the sale of John Edwards' house in Georgetown strike anyone else as something less than all that?
The Post says that Edwards "finally succeeded last month in selling his imposing Georgetown mansion for $5.2 million after it had languished on the market" and that Edwards' spokeswoman said at the time that the house had been sold to an unidentified corporation. "In reality," the paper says, "the buyers were Paul and Terry Klaassen."
Reality check No. 1: As the Post acknowledges later in its own story, the Klaassens bought the house through something called "P Street LLC," a limited-liability corporation they seem to have created for the purpose of buying the house. So when Edwards' spokeswoman said that the house was purchased by a corporation, she was right.
Yes, but who are the Klaassens? The Post says that they're the owners of nation's largest chain of assisted-living facilities for seniors, that they're "cooperating with a government inquiry in connection with accounting practices and stock options exercised by them and other company insiders," and that they're "the focus of legal complaints by some of the same labor unions whose support Edwards has been assiduously courting for his presidential bid."
Reality check No. 2: So? We've sold a couple of houses in our day, and we'd be hard-pressed to remember who the buyers were. We certainly wouldn't have known whether they'd had issues with the government or with labor unions. Does someone in public life have a greater obligation to know about the people to whom he's selling? In some circumstances, sure. If Edwards had been, say, the head of the SEC when he made the sale, then there would be cause for concern here: The buyers might have paid too much for the house as a quid pro quo for better treatment in the SEC case. There might also be reason for concern if the buyers were the leaders of the labor unions Edwards is courting: Maybe he'd be inclined to give them too good of a deal as a quid pro quo for their support.
But the reality? Edwards is a former senator and presidential hopeful from the party that doesn't control the executive branch. As such, it's hard to see how he could be of much service to the Klassens in their SEC case until at least 2008, and that's assuming that he wins both the Democratic nomination for the presidency and the presidency itself. And the Klassens aren't labor leaders; they're in disputes with labor leaders. How does selling them a house help Edwards win political support from the unions?
And that leads us to reality check No. 3. It's hard to make anything at all out of any of this unless you start with the assumption that the price Edwards got for the house was either too high or too low. Can the Post make that case? Not so far as we can tell. The paper says that Edwards paid $3.8 million for the house in 2002 and then made "substantial renovations" before selling the house for $5.2 million, "half a million dollars below the asking price but still $1.4 million more than the Edwardses paid four years earlier."
Is there anything particularly suspect about that? Not really. According to the Post's annual housing reports, median home prices in Georgetown rose by about 4 percent between 2002 and 2003, by about 5 percent between 2003 and 2004, and by about 15 percent between 2004 and 2005. Put those together, and the house Edwards bought for $3.8 million in 2002 could be worth around $4.8 million in 2006 -- and that's before you figure in the "substantial renovations" the family made or the appreciation they might have enjoyed in 2006, a year for which the Post's annual real estate statistics aren't yet available. Once you add those factors into the mix, a sales price of $5.2 million hardly seems worthy of eyebrow raising, let alone front-page innuendo.
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