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“Nobody’s Hands Are Perfectly Clean in Politics”


In her NyTimes OpEd endorsing the candidacy of Barack Obama, Caroline Kennedy tells us that rather than basing our decision on a candidates’ stated positions on the issues or on their experience we should focus instead on his character.

Most of us would prefer to base our voting decision on policy differences. However, the candidates’ goals are similar. They have all laid out detailed plans on everything from strengthening our middle class to investing in early childhood education. So qualities of leadership, character and judgment play a larger role than usual.

I have long been an admirer of Ms. Kennedy’s and I think she has point. Problem is, Obama has a Tony Rezko problem. Actually a whole bunch of Tony Rezko problems. And a few other problems here and there which do not say very good things about his character or his sense of ethics or his ability to spot the appearance of impropriety. I include on that list the recent revelations about the legislation which he claims to have "passed" relating to leakage of nuclear material into drinking water.


When Obama became president of the Harvard Law Review, Rezko interviewed him for a job working for one of Rezko’s companies. Obama turned down the job, but instead accepted more indirect employment at the law firm representing a series of Rezko’s not-for-profit partners in the series of transactions to build and rehab low income housing that are now the subject of federal indictment in Chicago which US Attorney Patrick Fitzgerald described as "pay to play on steroids."

Obama was an attorney with a small Chicago law firm — Davis Miner Barnhill & Galland — that helped Rezmar get more than $43 million in government funding to rehab 15 of their 30 apartment buildings for the poor.

Resko got millions of dollars to build and rehab low income housing and according to the government, embezzled the money. The people in those houses had no heat, no water. They lived in squalor–many in Obama’s State senate district. You could assume constituent complaints would have come in and Obama’s law firm did the legal work for those government contracts and grants. Yet he denies knowing about it.

During this period, Rezko was mentoring him and raising money for him and hosting parties to introduce Obama to influential people.

When Obama ran for the U.S. Senate, Rezko held a June 27, 2003, cocktail party in Rezko’s Wilmette mansion, picking up the tab for the lavish event. Obama’s campaign staff has said it has no records to show who attended that party, or how much it cost.

As an aside, Obama told the press that the total amount raised by Rezko for him over his career was only about $60,000, when the amount given by Rezko has been reported at $162,000 and change, and if you count the money Rezko bundled for him it goes even higher.

After he was elected to the Senate and while he was anticipating a large sum of money from his soon to be best selling book, Obama found his dream home. There is an extensively detailed post over at MyDD explaining the timeline of this purchase and just how "insider" it was. It’s a real eye opener. Read to the end past all the maps and statistics.

There was a slight hitch in that Obama could not quite afford the asking price for the house which was situated on a large lot. According to MyDD, Michelle Obama used her position on the Chicago Landmarks Commission to facilitate the subdivision of the lot.

Barack Obama, for his part, went to Rezko for "advice" about how to buy a house he cannot afford and "poof" Rezko’s wife pays full price for a portion of the property and Obama gets a discount on the house. A while later, he bought back 1/6 of the lot from her for 1/6 of the price she paid for it. How is that different from an interest free loan equal to the amount paid for that 1/6 of the lot? According to MyDD, Obama pays for the landscaping of the Rezko lot and may have been using it to park his cars because his neighborhood does not allow on street parking, in which case how is this different from rent free occupancy of the land?

Now comes the revelation: the Chicago Sun Times reported that Obama is mentioned in the federal criminal case against Rezko.

Obama is not named in the Dec. 21 court document. But a source familiar with the case confirmed that Obama is the unnamed “political candidate” referred to in a section of the document that accuses Rezko of orchestrating a scheme in which a firm hired to handle state teacher pension investments first had to pay $250,000 in “sham” finder’s fees. From that money, $10,000 was donated to Obama’s successful run for the Senate in the name of a Rezko business associate, according to the court filing and the source.

Rezko, who was part of Obama’s senatorial finance committee, also is accused of directing “at least one other individual” to donate money to Obama and then reimbursing that individual — in possible violation of federal election law.


Add to that this golden oldie from the Chicago Tribune.

Nowhere was Obama’s ability to navigate Springfield’s subcultures on better display than at The Committee Meeting. That was the code name for Wednesday night poker games attended by about a dozen lawmakers and lobbyists. Obama was a regular, and his stingy betting became a running joke with those at the table.


An exception to his disciplined routine was the poker game held inside the headquarters of the Illinois Manufacturers Association, the big business lobby whose legislative goals often were at odds with those of liberals like Obama.

Handed a cigar and cocktail on the way in, players left a few hundred dollars richer or poorer. Obama played liked he legislated, "slowly, deliberately, cautiously," recalled Jacobs. [emphasis mine]

The ChiTrib doesn’t explicitly say whether he won or lost. And I am certainly not suggesting he lost. To the contrary, the segment highlighted, suggests he DIDN’T lose.

One of the things that came out about Abramoff et al. was that they would invite Congress critters to play poker and wine and dine in a hotel suite that the lobbyist paid for, and then let them win. It was a way of passing money to them without leaving a paper trail. The Chicago events were hosted at the HQ of a lobbying organization, I think it’s fair to assume that the cocktails and Cohibas were provided by the hosts and the article makes a point of saying that he was a stingy better and a cautious player–directly suggesting that he seldom lost. And what kind of message are you sending joking about the game being a "Committee Meeting"?

One of the reasons public corruption cases, at least the bribery part, are often so hard to prove is that the participants go to great lengths to have a "beard" for the transactions. Paying for vacations, losing at poker, doing repairs on the elected’s house without any invoices, throwing business to the elected’s (or their relative’s) law firms or companies, regularly taking the elected out for very expensive meals is known as soft bribery. In the Bess Meyerson case, which the government lost, the bribe was a job for the judge’s otherwise unemployable daughter.

Unless someone flips and gives you testimony, or unless, as in Operation Greylord, you have audio or video tapes, it’s really really hard to get a conviction because there usually is not much of a paper trail. Since there wouldn’t even be hotel records for the Chicago games, they are particulary fuzzy.

Back to REZKO

Unless there is testimony out there. Long ago when I was doing criminal cases, an unnamed source from the prosecution was called "a source close to the investigation" and a leak from the defense was called "a source familiar with the case." I don’t know if the ChiSun uses those naming conventions, but it occurs to me that someone may have been trying to scare the pants off Obama. Interestingly, Obama suddenly left Nevada and flew back to Chicago on Sunday right after the caucuses.

If I’m the AUSA handling the case, I would assume (if I didn’t know already) from that leak from the source "familiar with the case" that there is definitely somebody out there with testimony and I might even know who that person is and that this is the time to squeeze him. It’s a sign that the defendants and suspects are considering turning on each other. Always a happy thing for the prosecution.

I don’t know what Obama did to merit so much help from Rezko. The Chicago Sun Times reported that

As a state senator, Barack Obama wrote letters to city and state officials supporting his political patron Tony Rezko’s successful bid to get more than $14 million from taxpayers to build apartments for senior citizens.

In that deal Rezko paid only $1 for the land. The rest of the deal, which included an $800,000 development fee paid to Rezko’s company, was entirely financed by public money. There is also a much more minor incident involving giving an internship:

John Aramanda served as an intern for Obama for about a month in 2005, said Obama spokesman Robert Gibbs. His father is Joseph Aramanda, a Rezko business associate who was named as an unindicted co-conspirator in a federal corruption case against Rezko. Aramanda has contributed $11,500 to Obama since 2000, Gibbs said. “Mr. Rezko did provide a recommendation for John Aramanda…" [emphasis mine]

Was it simply enough that Obama didn’t make waves about the lack of heat and deplorable conditions in the Rezko buildings situated within Obama’s state senate district? I don’t know. But I was struck by a comment Obama made in the debate on of the debates to the effect of "you know how Illinois politics are" or some such. Followed later on by

Nobody’s hands are perfectly clean in politics. That is true. I mean, there a distinction, though, between not taking PAC and federal lobbyist money and having that as a major way of driving your campaign and having some ancillary involvement. [emphasis mine]

At the time, I wondered to myself, "where did that come from?"

photo by ldandersen

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