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Famous Texans Phil Gramm

"Has anyone ever noticed that we live in the only country in the world where all the poor people are fat?" -- Phil Gramm, during his first Senate campaign against Democrat Lloyd Doggett when Gramm had just begun running against the poor.

Best known for: Right-wing Democratic politician who switched parties and became a Republican Senator from Texas.

Born: July 8, 1942, in Fort Benning, Georgia. 

Family: Wife: Dr. Wendy Lee Gramm, former chairman of the U.S. Commodity Futures Trading Commission under Presidents Reagan and Bush; Children: Marshall and Jefferson.

Education: B.B.A. from University of Georgia (1964), Ph.D. from University of Georgia (1967), Military Service: None.

Profession: Economics Professor, Texas A&M University (1967-78); Partner, Gramm & Associates (1971-78); Author of several economic texts and articles on subjects ranging from monetary theory and policy to private property to the economics of mineral extraction.

Career: Gramm unsuccessfully sought the Democratic nomination for U.S. Senate in 1976. He first won election to the House of Representatives as a Democrat three years later. The long-standing state tradition was for right-wing Texans to pose as Democrats to get elected.

The atmosphere in Congress was beginning to get too partisan for that kind of politics, however. After Gramm co-authored President Reagan's economic program, he lost his seat on the House Budget Committee. He then resigned from Congress and "defected" to the Republican Party. As a sign that old political boundaries were changing, Gramm was the only member of Congress in the twentieth century to resign from Congress and seek re-election as a member of another political party. He won a special election on Lincoln's Birthday, becoming the first Republican elected in his district in a century.

In 1984, Gramm ran for the Senate, winning more votes than any candidate for statewide office in the history of Texas. Early campaign contributors included:

During that 1984 campaign, the Federal Election Commission (FEC) began investigating Gramm's campaign finances. He had paid Jerry Stiles, a Texas builder, $63,000 to complete his waterfront house in rural Maryland. The builder also ran three troubled savings and loans. The cost of the work he did on the house was $117,000. FBI agents who later investigated Stiles on S&L-related charges found this discrepancy suspicious. Gramm was involved with the owners of at least three Texas S&Ls that later failed at a cost to taxpayers estimated at $160 million, and had previously contacted federal regulators on behalf of Stiles and his savings and loan.

When the Gramm learned of the probe, he quickly sent the builder $50,000 to cover the difference, then took back the check when the Senate Ethics Committee noticed. Gramm, who later advocated full disclosure of embarrassing records by President Clinton, sued the FEC and waged a costly fight to seal his own records. In 1987, the Senator was fined $30,000, one of the largest ever handed down by the FEC. Stiles' corrupt S&L deals collapsed in 1989, costing taxpayers an estimated $200 million. Stiles was sentenced in Texas to 55-years on 11 counts of conspiracy and fraud. The investigation originally began as the result of a complaint filed by Donna Mobley of Austin, a crusader for economic justice, civil liberties and good government who met an untimely death ten years later.

In 1985, Gramm was linked to a campaign contribution shakedown run out of a Small Business Administration (SBA) office in El Paso. He was never subjected to a complete investigation or negative press coverage, however, because on February 19, 1988, a leased Rockwell Aero Commander 680 crashed and exploded shortly after taking off from El Paso International Airport. All aboard, the pilot, his wife and son, were killed. The pilot was local businessman Don McCoy who, a day earlier, had agreed to give testimony in an FBI investigation that had threatened both Senator Gramm's protégé at the SBA, and some of the city's most prominent business leaders.

Gramm was re-elected in 1990 with the highest vote percentage of any Senate candidate in a Texas general election in over three decades.

Gramm's legislative record includes such bills as the Gramm-Latta Budgets and the Gramm-Rudman Act. Gramm-Latta mandated the Reagan tax cut. Gramm-Rudman placed the first supposedly binding constraints on Federal spending. Gramm was chairman of the National Republican Senatorial Committee during the return of a Republican majority in the Senate in 1994. With that majority in place, Gramm, as chairman of the Banking Committee, led passage of the Gramm-Leach Act, making changes in the banking, insurance and securities laws which Congress had kept at bay for sixty years.

Gramm also led the fight against President Clinton's Health Care Bill, authored changes in the welfare system, and initiated the doubling of forces in the Border Patrol. He and Senator Robert Byrd of West Virginia won passage of a highway bill that mandated use of the entire gasoline tax for road construction. Gramm has also worked to invest Social Security funds in the stock market.

In 1996, Gramm spent $20 million seeking the Republican presidential nomination, but did not survive the earliest contests leading up to the New Hampshire primary. He had been defeated by conservative commentator Pat Buchanan in Louisiana and placed fifth in the Iowa caucus. A main theme of Gramm's campaign was a test he concocted for government spending programs called the "Dickie Flatt test." It was named in honor of Dickie Flatt, Gramm's symbolic everyman who ran a small print shop in Mexia, Texas. The test was based on Gramm's question: "Will the benefits to be derived by spending money on this program be worth taking the money away from Dickie Flatt to pay for it?"

Apparently, much larger business interests thought the Dickie Flatt test would benefit them. A graphic at the web site for the PBS Frontline program called "So you want to buy a president?" (which aired January 30, 1996) included the following information on Phil Gramm's top contributors at the time of his short-lived presidential campaign:

Top contributors
Phil Gramm $19,171,476

Source: Center for Responsive Politics, FEC records.

In an appearance with his friend and senate college, Senator Kay Bailey Hutchison, at the 1999 re-dedication of the Daughters of the Republic of Texas Museum in Austin, Gramm joked about their relationship. "When people introduce us, they introduce us as the beauty and the beast. Which is always confusing to me because I never know which is which," he said. "Kay tries to charm people into doing what we want, and if that fails, I beat them into submission," Gamm added, playing down Hutchison's reported temper.

Serving his third term in the Senate, Gramm said in 1999 that he planned to seek re-election when his term was up in 2002. After Gramm's dismal showing in the race for the Republican presidential nomination in 1996, it was speculated that he might give up politics after finishing his term.

Sources: U.S. Senate Biography (http://www.senate.gov/~gramm/bio.html); USA Today, "Election '96: Sen. Phil Gramm," (http://cgi.usatoday.com/elect/ep/epr/eprgbio.htm); Sam Attlesey, "'Beauty and the Beast' tout their road show," The Dallas Morning News, December 12, 1999, (http://dallasnews.com/texas_southwest/columnists/5840_TEXPOL12.html); Louis Dubose, "On Remembering and Phil Gramm," The Texas Observer, August 19, 1994, p. 5; Louis Dubose, "Who was on First? An X-mas List of Semi-Illustrious Texans Who Bankrolled Phil Gramm Before It Was Cool," Texas Observer, December 22, 1995, (http://www.texasobserver.org/subjects/politics/gramm.html); Louis Dubose, "Phil Gramm's Dirty Money," Texas Observer, September 27, 1996, (http://www.texasobserver.org/subjects/dateline/gramm$.html); L.J. Davis, "Republican Whitewaters," Mother Jones magazine, July/August 1996 (http://www.mojones.com/mother_jones/JA96/davis_jump1.html); The Newsroom, "Phil Gramm's presidential campaign announcement," February 24, 1995 College Station, TX, (;   Frontline, PBS-TV, "So You Want to Buy a President," January 30, 1996, Phil Gramm contributors chart, http://www.pbs.org/wgbh/pages/frontline/president/guide/charts/gramm.html;   Todd J. Gillman, "Wealthy Dallas-area enclaves help fund Bush campaign," The Dallas Morning News, August 21, 1999, (http://www.dallasnews.com/metro/columnists/0821metcol2gillman.htm).