Thursday, April 10, 2014

Menendez and Melgen, BFFs: Why?

Senator Robert Menendez

"(Robert) Menendez is the boss in Hudson County, which is ground zero for the state's corruption problem."

This 2005 quote, from an editorial writer for New Jersey's largest, mostly left-wing newspaper, appeared in a book published in 2012.

Being called the boss of the crookedest county in New Jersey is no compliment.  New Jersey is nothing like those goo-goo states (Colorado? Maine?) where politicians mostly play by the rules.  Still, Jerseyans are used to it.

So reports yesterday that one of Robert Menendez's best buddies was in the news again didn't set off shock waves in Jersey.  Nary a ruffle.

Still, there is a question to be answered:  Why does Menendez stick with this guy?

Salomon Melgen, an ophthalmologist and friend of Menendez, was the nation's highest-billing Medicare doctor in 2012.  He collected almost $21 million from the agency.

Dr. Melgen has a large practice in Florida, and most of his income appears to come from injections of the drug Lucentis, the most expensive of several drugs that treat macular degeneration, a problem for many older people.  Novartis, the company that makes Lucentis, is reported by the New York Times to pay generous rebates to doctors who use the drug.

Before that, the federal government had forced Melgen to forfeit $8.9 million for overpayments collected from Medicare.  Sen. Menendez defended Dr. Melgen, saying Medicare's rules were unclear. The doctor still is seeking the return of his money.  Dr. Melgen was banned from seeing Medicare patients for a time but, obviously, is now back in the business.  This suggests inside help.

(Think about it:  If your doctor had collected $8.9 million in overpayments from a government program, would be he or she be allowed to participate in the program again, even from Club Fed?  I don't think so.)
Doctor Salomon Melgen
Dr. Melgen is a big supporter of Sen. Menendez.  His firm donated more than $700,000 to a PAC run by ex aides to Senate Majority Leader Harry Reid.  The PAC then gave $582,000 to Menendez's re-election campaign last year.  In addition, Dr. Melgen and his relatives have personally contributed almost $100,000 to Melendez campaigns since 1992.  There are reports that the Melgen family has contributed more than $1million, directly and indirectly, to Menendez.

But so what?  Menendez was appointed to his seat when Jon Corzine got tired of being a senator and bought himself the New Jersey governorship in 2005.  At that point Menendez had a war chest of over $4 million and no serious opposition; he won election easily in 2006 and then re-election in 2012.  New Jersey is a blue state and not likely to elect a Republican senate candidate anytime soon.

And Menendez, a prodigious fund-raiser and a member of the Senate Finance Committee, raised more than $15 million between 2009 and the end of 2013.  He has plenty of time to raise another pile of cash for his re-election campaign in 2018.

Think about it.  Why should Menendez exert himself on behalf of a creep like Melgen for a crappy million bucks?

It's a mystery, but this isn't the only case in which Menendez has gone to bat for Dr. Melgen.

We in New Jersey remember when it was reported that Menendez traveled on Dr. Melgen's private jet to the Dominican Republic for at least two pleasant vacations at the doctor's $20 million gated estate.  Members of Congress are paid pretty well and get decent perks and generous retirements, in part to encourage them to avoid these kinds of conflicts of interest.  It was almost three years later, after the facts about Menendez's vacations came out, before Menendez paid Melgen for the good times.

 (There also were reports that a friend of Melgen's in the Dominican Republic arranged escorts, perhaps underage, for Menendez, who is divorced. These never have been substantiated.  If Menendez was smart enough to climb the greasy pole of Hudson County politics, it seems unlikely to me that he would make that kind of a mistake.)

But still.  After an experience like that, most politicians would stop taking phone calls even from the most ardent and wealthy supporter.

Not Menendez.  In fact he has tried to help Dr. Melgen on at least one other occasion.

Menendez was reported to be often at odds with the Obama administration for its failure to block importation of illegal drugs to the United States from the Dominican Republic.  Then, when the administration announced plans to give the Dominican Republic sophisticated drug-detection equipment for its ports, Menendez objected.

By that point, curiously, Dr. Melgen, with no security experience whatever, had formed a port security company, Boarder (sic) Support Services, an LLC based in Florida.  Dr. Melgen's plan was to buy the port security equipment privately, place it in the Dominican Republic and collect rental revenues for its use from the Dominican government.  Estimated returns ranged as high as $500 million for Melgen's company.

Menendez staffers went on the offensive, opposing the administration plan but never mentioning their preferred security provider.

It was reported that a former Menendez aide would run the operations of Melgen's Dominican security program.

By February of 2013, even the blue New York Times opinion page had had enough.  It called on Menendez to resign his chairmanship of the Senate Foreign Relations Committee, at least temporarily.  Menendez stayed put and is still there.  Go figure.

Best Friends Forever, Apparently

There are many other interesting/puzzling stories about Robert Menendez and his political career in New Jersey.  I will leave them for another day.

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