Household Budget Buster Alert!

John Kerry has a personal budget problem. Of course, it's on a rather different scale than those faced by us little people - $6.4M loan that saved Kerry may also drain him:

Once written off as a Democratic presidential contender, John Kerry survived to become the front-runner thanks to a $6.4 million Christmas Eve loan he made to his campaign.

The loan allowed Kerry's campaign, which was struggling to raise money, to put ads on the air and pay staff until victories in Iowa and New Hampshire produced new funds. But now the loan, which he got using his home in Boston's exclusive Beacon Hill neighborhood as collateral, places a financial burden on the Massachusetts senator, with no easy way to pay it off:

• Kerry's financial disclosures show no assets sufficient to pay the loan or even to keep up with the interest payments. Aides say he has assets that aren't listed on the forms but decline to reveal them.

• His wife, heiress Teresa Heinz Kerry, has a fortune estimated at more than $500 million. But the law forbids her from paying off a campaign loan for her husband.

• If he wins the nomination, Kerry could pay himself back from campaign contributions made before the Democratic convention in late July. But doing so would siphon off money at a time when he would be running against President Bush, who will have a projected $200 million to spend.

One can't help but ask how the beamish boy got the loan in the first place:

Kerry borrowed the money Dec. 24 from the Mellon Trust of New England. It is payable over 30 years, with interest-only payments for the first 10 years, at a variable interest rate beginning at 3.125%.

Kerry's campaign says he intends to pay off the 30-year mortgage, which carries annual interest payments of about $200,000. But that is more than his $158,000 Senate salary and all his other income put together, according to his financial disclosure statement.

Sounds like a good loan candidate to me! In the "bad old days" he could have used campaign funds to pay off the loan, but the new "campaign reform" bill makes that much tougher:

In 1996, Kerry loaned his Senate re-election campaign $1.9 million, using the same town house as collateral. He struggled to pay off the loan, retiring it three years later by raising the money from campaign donors. At the time, it was legal to do that.

A provision in the new campaign-finance law limits Kerry's ability to raise contributions to pay off the loan, however. The law says candidates can raise money to pay off personal loans to their campaigns only before the election. Once the election has passed, they are limited to a reimbursement of $250,000. In the case of presidential primaries, the election season is defined as the period before the party's convention, which for the Democrats begins July 28.

The section was put into the law to keep politicians from hitting up donors once they are in office to pay off money they loaned to their campaigns — in effect transferring campaign donations directly into their own pockets.

But if Kerry becomes his party's presidential nominee, repaying himself for the campaign loan could mean taking more than $6 million from campaign contributions at a time when the party is desperate to stay financially competitive with Bush. Such a decision could anger donors who want their money used against Bush, not to redeem Kerry's house.

Poor baby! He's also not allowed to just sell his half of the house to Teresa. But the folks at his campaign are hinting at hidden assets:

"Sen. Kerry is a man who has considerable assets," says Michael Meehan, a campaign spokesman.

Kerry's government disclosure form, covering 2002, gives no hint of what those assets might be.

The form doesn't require disclosure of property that is not held for investment purposes, such as the house in question — a $13 million Boston house Kerry owns jointly with his wife and mortgaged to finance his campaign. Aides hint that Kerry may own other non-investment property that could be sold to satisfy the debt, but they won't provide details. "He has disclosed what he needs to disclose" under the law, Meehan says.

Nothing like full disclosure by the party of the people. But here's a puzzle:

Before he was married in 1995, Kerry's disclosure forms ranked him as one of the least wealthy members of the Senate. His 1994 form showed a trust fund worth no more than $100,000 and debts of at least $20,000. Since then, he has inherited other trust funds from his mother.

Kerry and his wife bought the house together after they were married. It is not clear whether Kerry used his assets to acquire his share of the town house, or whether it was a gift from his wife, whose wealth comes from the Heinz ketchup fortune. The Kerry campaign declines to say.

Since his marriage in 1995, Kerry has repeatedly refused to fill in the missing details of his financial holdings. When he renegotiated terms of a divorce from his first wife that year, he took the unusual step of having the court records on his finances sealed.

So where did these mystery assests come from? C'mon John, you can be straight with us. What's "The Real Deal"?

And if Lurch is still hard up for cash - how about a second job? Gigolo is out, since he married his last customer, but maybe Simon and Schuster could come up with a Clinton style book advance? Nah, he just wrote a snoozer campaign book. I know! How about running a boarding house for press interns of the female persuasion? I'm sure they would be elevated by the experience and Lurch could haul down some cash.