Yesterday, I wrote about the lame CNN story that’s one of the “raises questions” variety that is long on supposition and short on facts. Leave it to Democrats to make the entire scenario even more stupid with Senator Chuck Schumer suggesting Rep. Tom Price broke the law with a humungous purchase of twenty-six shares of stock.
Here is what Schumer said:
“If he knew about it, it could very well be a violation of the law,” Schumer told CNN. “Now they say there’s a broker, it’s kind of strange that this broker would pick this stock totally independently of him introducing legislation that’s so narrow and specific to this company.”
Nobody on the Trump transition team nor anybody from Dr. Price’s office ever suggested there wasn’t a broker involved, so for Schumer to say, “Now they say there’s a broker,” as if there’s backtracking is absurd. Also, it defies all common sense and logic. If Price were colluding with a broker to benefit financially from a stock trade influenced by new legislation, it would stand to reason they’d purchase a whole hell of a lot more than twenty-six shares.
Here’s another issue with CNN. At the time of the release of this report, they knew it was only 26 shares, but they still said this:
Schumer also called for an investigation of Price after CNN reported that Price bought up to $15,000 worth of stock in Zimmer Biomet — a medical device maker — and then introduced a measure that would have directly benefited the company.
It looks more sinister to say “up to $15,000” because that’s what the disclosure form says (the form requires listing the name of the company in which stock was purchased a check box for the value. The first range is $1,000-$15,000.) CNN could have said, “As little as $1000 worth of stock” but that wouldn’t make for a good story.
The bottom line is, Tom Price did nothing wrong. Nothing he did was unethical, let alone a violation of the law. Here is a simple timeline of events:
- September 21, 2015: Tom Price and 60 other members, both Republican and Democratic, write to the Acting Administrator and Chief Medical Officer of Centers for Medicare and Medicaid Services to express concern over a new payment model for lower extremity joint replacement. The change would have marked a major shift in Medicare payment, and the lawmakers asked the agency to delay implementation of the rule for at least a year. If implemented, the rule would have acutely affected manufacturers of hip and knee implants.
- March 17, 2016: Morgan Stanley undertook a comprehensive rebalancing of Tom Price’s broker-managed portfolio. In the course of that rebalancing, the advisor purchased 26 shares of knee and hip implant maker Zimmer-Biomet, worth $2,697.74. Notice was not provided to Congressman Price for a month.
- March 23, 2016: After CMS’ refusal to delay implementation of the new payment model, Tom Price introduced the bipartisan HIP Act to would block the implementation of the Comprehensive Care for Joint Replacement model. The bill had 24 cosponsors.
- April 4, 2016: Morgan Stanley notifies Tom Price of the portfolio rebalancing for the first time, including the Zimmer-Biomet trades. A day later, Price notifies the federal government.
If one wants to do the math, BHZ’s stock price on at the close of business on March 17, 2016, was $103.59. One week later, when Price introduced the HIP Act legislation, BHZ’s stock price at the close of business on March 23, 2016, was $104.43. That’s less than one dollar per share. $25. That wouldn’t be enough to cover an Uber ride from Rep. Price’s home in the suburbs of Atlanta to Hartsfield-Jackson International Airport.
The highest the BHZ stock price went, is $133.59 in August of 2016. With an increase of $29 a share from the time Morgan Stanley purchased the stock, that’s a huge gain of $754!
CNN’s story is lazy and poor journalism that doesn’t “raise questions” or search for the truth. It is an attempt to use the news to create news. The Trump transition team is asking CNN to retract the story and I agree. It’s garbage.