Granholm DeVos Debate Fact Checking

Lots of fact checking is already posted on line following the first of three debates between Dick DeVos and Michigan Governor Jennifer Granholm. Granholm’s campaign fact checking here. I would like to “fact check” or otherwise analyze the economic plans of Dick DeVos but there’s a problem in doing so. Once again DeVoss failed to provide any specifics. This includes a failure to comment on how he would replace the single business tax. He did admit he would only replace half the lost revenue, while failing to explain how he would cut costs to make up for the remainder of the lost revenue. Meanwhile Granholm scored big by pointing out how many years the single business tax existed under Republicans, raising questions as to whether this tax can really be seen as the cause of Michigan’s problems.

Another debate highlight was when Granholm accused DeVos of not disclosing publicly that he had invested $170 million in Alterrra, an assisted care company that was accused of allowing abuse of some of its patients. “This was an investment that was not disclosed like other interests,” Granholm said. “Perhaps because you didn’t want people to know about sexual and physical abuse of seniors.”

De Voss played down his investment in Alterra, stating his “Holdings were less than 1% of the company.” Michigan Liberal links to an article in the Milwaukee Journal Sentinel which refers to “the investment vehicle of the DeVos Family, which owns 20% of Alterra.” Today’s math lesson: twenty percent is not the same as one percent.

DeVos continued to play this down. “It was a tragic situation,” he said. “It turned out to be a bad investment.” Michigan Liberal also includes this information on Alterra:

Alterra recently went through bankruptcy, so I guess it wasn’t a very good investment, but it’s a BAD investment for some pretty horrifying reasons. Alterra is in the nursing home business, and that business has been skirting federal laws and cutting corners for years. According to the SEC, DeVos has $173 million invested in this company.

DeVos tried to hide his opposition to stem cell research by claiming support for stem cell research to distract from the fact that he opposes embryonic stem cell research, which shows the greatest potential for developing cures to multiple diseases. At least he was more honest in stating his extremist views on abortion. He would not even make an exception in his opposition to abortion rights for either rape or incest.

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9 Comments

  1. 1
    J says:

    Looking at the sec doc from alterra. The date is from the period ending in 2001. If I remember right, De Vos stated he currently holds 1 % What about the sec doc ending 2005. What does that say?

  2. 2
    smitty says:

    De Voss played down his investment in Alterra, stating his “Holdings were less than 1% of the company.” Michigan Liberal links to an article in the Milwaukee Journal Sentinel which refers to “the investment vehicle of the DeVos Family, which owns 20% of Alterra.” Today’s math lesson: twenty percent is not the same as one percent.

    ————————————————————–

    Read what you wrote….the DeVos FAMILY owns 20% of Alterra. Big difference…BIG difference.

  3. 3
    Ron Chusid says:

    True, there is a difference between his personal and family holdings. Despite that, DeVos sure seems to be trying to minimize his connection to Alterra.

  4. 4
    Big J says:

    Actually, you might want to re-read the SEC document, specifically footnote #3 on page 61. Nowhere does it say DeVos has “$173 million invested in the company”.

    What it DOES say is that a bunch of investors, of which DeVos was one, bought $173 million of Alterra debt. That debt was in turn structured as stock, a portion of which is Class B non-voting stock:

    “The Series B Debentures are convertible at any time at the applicable holder’s option into shares of the Company’s Series B Non-Voting Participating Preferred Stock (the “Series B Stock”)”

    Further, footnote 4 on page 62:

    “the RDV Reporting Persons as a group have sole power to vote or to direct the vote and sole power to dispose or direct the disposition of 3,200,052 shares of Common Stock.”

    According to the table on page 34, Alterra had 22,219,000 shares of Common Stock outstanding as of Dec 31, 2001.

    So, of 22,219,000 shares, an investment group of which DeVos was a member controlled 3,200,052, or about 14%.

    Today’s business lesson #1: 14% of a company is not a controlling stake.

    Today’s business lesson #2: some portion (DeVos’ portion of the group’s total investment) of 14% is not the same as 14%.

    Today’s business lesson #3: buying some of a company’s debt is not the same as running the company or being responsible for its actions.

    Today’s math lesson: some portion of $173 million is not the same as $173 million.

    My statements are just based on a quick glance through the 10-K you cited. To REALLY figure it out, you’d have to read the 13D from DeVos’s investment group, not just Alterra’s 10-K. I guess Granholm’s staff figured nobody would bother to actually read the documents.

    I’m no business expert, but based on what I’ve read in that 10-K so far, I’d have to seriously doubt any conclusions the Milwaukee Journal or Gov. Granholm make about DeVos’s investment in Alterra.

  5. 5
    Ron Chusid says:

    It’s not just the Milwaukee Journal and Governor Granholm. The Free Press has also places the DeVos’s family holdings at $173 million.

    As much as you might want to quibble over details such as whether it is DeVos’s money or his family’s, the bottom line is that he is being evasive about his financial holdings and he sure looks like someone hiding something here.

    Before accusing Granholm’s staff of figuring “nobody would bother to actually read the documents” keep in mind that it is DeVos who has refused to release one key document with regards to his financial holdings–his income tax returns.

    We don’t know exactly how much DeVos had invested in Alterra, but until he comes clean on his investments he cannot act so shocked and innocent when such charges are raised against him.

  6. 6
    Big J says:

    The 10-K for Alterra and the 13D for the investment group would explain exactly how much he has invested. Unless you’re claiming now that he is defrauding the SEC, too.

    I’m not “quibbling over details”. You sarcastically remarked in your post that “20% is not the same as 1%”. In short, agreeing with the 20% and implying that DeVos is being inaccurate. I’m simply pointing out that you aren’t accurate, either.

    You can dodge it by claiming now that the actual amount doesn’t matter (even though it seems to in your post), that’s fine.

    If you’re going to argue a strawman, don’t forget about your own. If DeVos being inaccurate means he’s hiding something, then what are you hiding?

    I love the automatic assumption that Granholm isn’t hiding anything. So much for being fair, and so much for the presumption of innocence.

    Perhaps DeVos’s stance is pretty simple: he already has disclosed his financial dealings to the SEC. The problem is, most people are too lazy to do the research and would rather rely on sound bites and slogans.

    You keep using phrases like “charges are raised against him”. This is obtuse at best…what charges, exactly? Where is the connection between investing in a company and running a company? Are Enron stockholders to blame for the Enron debacle? Are you saying that DeVos did something wrong by trying to get a return on his money? What’s wrong with that?

  7. 7
    Ron Chusid says:

    I already admitted that I was too quick with the snark comment, but that doesn’t change the actual questions raised in the debate and newspaper articles. Dwelling on a comment that is totally irrelevant (my comment on the 20% versus 1%) has absolutley no relevance to the actual issues raised. It is a trivial point as how much money was DeVos’s personal money versus family money does not affect the relationship between DeVos and Alterra.

    Granholm did release her tax returns. DeVos didn’t. The published reports on Alterra indicate “RDV Corp., the investment vehicle of the DeVos Family” was directly involved in the running of Alterra. The evidence so far is that DeVos was not simply a stock holder as you claim.

    We have been given reason to believe DeVos may be hiding something while there has been nothing comparable regarding Granholm. If DeVos wants a presumption of innocence he might release his tax returns and he should not have hidden this when claiming to disclose his financial holdings.

    If there is really nothing wrong with what DeVos did, why did he fail to disclose this and why are you distorting the facts about this?

  8. 8
    Big J says:

    I’m the guy quoting the facts, not someone else’s interpretation of the facts. What “published reports” are you talking about? Cite them. I’ve already been through the 10-K you cited, and didn’t see anything about RDV running Alterra.

    If by “published reports” you mean newspaper articles, you have to do a lot better than that, especially in this day and age where “published reports” means one newspaper quoting another quoting another quoting another instead of doing their own independent research.

    You say “fail to disclose”. Disclose what? Alterra filed its 10-K, RDV filed their 13D. Are you saying that’s not disclosure? Are you saying the SEC is going to ignore something bogus?

    My point is simple: sometimes, there is no grand conspiracy, there is no smoking gun, and there is no fire. Have you considered that maybe, just maybe, the guy likes his privacy? Have you considered that maybe, just maybe, in DeVos’s world (the business world), “full disclosure” simply means complying with the laws in place, which it looks like he did?

    That’s what I’m saying: why is the guy automatically assumed to be hiding something when, as far as I can tell, he hasn’t broken any laws and sure as heck doesn’t need a governor’s salary?

    What happened to presumption of innocence? Why is privacy a bad thing? As long as DeVos complies with all state laws regarding the election, he has to be considered a valid candidate regardless of how much money he has, regardless of any innuendo, and regardless of any mudslinging.

    I vote Libertarian, so won’t be voting for either Granholm or DeVos. However, the person I would rather see in office, any office, is the person who really doesn’t want (or need) to be there, but feels it is their duty to be there to fix a problem and to help, vs. the person that wants to be a career politican and a manufactured, orchestrated one at that.

    Being objective and accurate means just that. Automatically assuming someone is hiding something just because they don’t do what you would prefer that they do is not being objective. To be objective, you have to give both sides of the argument equal weight. That means, in the case of DeVos’s financial disclosure, his possibly hiding something is absolutely equal to his possibly not hiding something.

    Actually, come to think of it, I want DeVos to win. Think about it: according to you and the Milwaukee Journal, the guy is now directly responsible for running three companies at the same time: Alticor, Alterra, and Windquest. That takes some skills!! Even Carlos Ghosn can’t do that!!

  9. 9
    Ron Chusid says:

    No, you are not being either objective or factual. You are discarding facts based upon whether you like them. The facts are linked to in my post. Sure, it is possible that the newspaper accounts are wrong, but it is absurd to dismiss all newspaper accounts which you don’t like. By your logic there would be no way to expose DeVos for his failure to honestly disclose his financial holdings.

    You also throw out a number of specious arguments such as confusing required financial disclosure with disclosure in a political race, calling for presumption of innocence where it does not apply, justifying his withholding information on privacy rights which do not apply in a political campaign, and your bizarre interpretation of his motives and skills.

    Disclosure in a political race does not mean simply meeting the SEC requirements. A candidate for governor is not entitled to the same level of privacy as a private businessman. Other candidates disclose such information. Typically when a candidate fails to honestly disclose their financial holdings, such as it appears DeVos has done, it is held against them by the voters.

    This is not a criminal case and presumption of innocence does not apply. The evidence is that DeVos has been evasive in disclosing holdings in a company because it would be embarassing to him politically.

    Voting for DeVos because he doesn’t need the job for the income is absurd. His interest is in the power, not the money. That’s why he purchased the DeVos for President and DeVos for Senate web domain names months ago.

    DeVos has shown an interest in exercising political power for quite a while–and it hasn’t been in a libertarian direction. He has worked for years to use the powers of the state to impose his extremist religious views on others.

    Responsibility for three companies is also a weak argument for his skills. It just means he inheritied the money which allows him to do so. He has the money to set up an investment company and have them do much of the work. Being involved in companies due to inherited wealth and then having busienss failures is no sign of skill.

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