FRONT PAGE CONTRIBUTOR
Obama and the Integrity Gap: The Machine
Chapter five of seven
D. The Machine
Chicago politics, of course, have been famously corrupt and totally dominated by the Democratic machine since beyond living memory. (In Illinois at the state level, corruption is endemic and bipartisan: “four of the last nine governors have been indicted on charges of corruption, and three were convicted”). This is the city where top aides to Mayor Daley were convicted in May 2006 of federal felonies for rigging hiring in city jobs. It’s a city where an alderman who pleaded guilty in August to a “general practice” of shaking down real estate developers was caught on tape saying “Most aldermen, most politicians are hos.”. (A Rezko-linked alderman, in fact, who is the daughter of a Rezko-linked housing developer once represented by Obama’s law firm – small world, indeed). It’s not an uncommon sentiment (several aldermen found it necessary to hold a press conference stating that they were not, in fact, hos).
The Chicago machine is nothing if not an equal opportunity honeypot; machine corruption and its close cousin, racial/ethnic politics, has endured over decades as different ethnic and racial groups have taken their turns running the city, all the while doling out favors within their wards. The current machine is topped by Mayor Daley, two decades in office and the son of the city’s most notorious mayor; at the state level, it envelops Democratic Governor Rod Blagojevich.
To all appearances, Barack Obama’s home neighborhood of Hyde Park – affluent, academic, ethnically diverse – should be a natural base for that rare breed in Chicago, the real reformer, with the independence to not only stand aloof from the politics of the greased palm and the dead voter, but actually make that politics more difficult:
The neighborhood invariably elects a goo-goo alderman who pulls killjoy stunts like, you know, asking to see what’s in the mayor’s budget before voting on it. The most famous, Leon Despres, who just turned 100, once spent five days at Trotsky’s place in Mexico City.
Of course, as noted above, Obama’s original district also extended to what Salon calls “the weary black neighborhoods to the west, with threadbare street corners that might hold a liquor store, or a chicken shack. (It did not include Trinity United.).” (Todd Spivak, who covered Obama in 2000, says Obama’s district “spanned a large swath of the city’s poor, black, crime-ridden South Side”)
Certainly Obama frequently postured as a political reformer in Illinois (“My reputation in Springfield was as an independent”), as well as in the U.S. Senate. Was that posture any more, or any less, genuine than his posture as a friend of left-wing radicals? I don’t know the answer to that either; I only know that Obama, with his sights set beyond Hyde Park, made sure never to get in the machine’s way. “Jay Stewart, the executive director of the Chicago Better Government Association, notes that, while Mr. Obama supported ethics reforms as a state senator, he has “‘been noticeably silent on the issue of corruption here in his home state, including at this point, mostly Democratic.’” The Chicago Sun-Times isn’t fooled either:
Obama friend Tony Rezko was convicted of corrupting state government, but Obama was never implicated and has returned contributions Rezko made to his Senate campaign. Obama did run as an independent Democrat but worked closely with state Senate President Emil Jones, an old-school organization Democrat. Obama runs for president with the full blessing of Mayor Daley.
As we shall see, this is not the half of it.
(1) It’s Good To Have Friends
Obama’s first run for public office was at age 34 in 1996, when Alice Palmer announced she was leaving her State Senate seat to run for Congress. As noted above, Palmer was one of Obama’s many far-left allies. As it turned out, Palmer lost her bid for Congress (to Jesse Jackson Jr, now Obama’s national campaign co-chair) and tried to come back and reclaim her job, but Obama stayed in the race. Unlike Sarah Palin’s three hotly contested races against incumbents, however, Obama and his allies were able to use the legal machinery of the city avoid a contested campaign:
According to the Chicago Tribune, Obama operatives flooded into the Chicago Board of Election Commissioners on Jan. 2, 1996, to begin the tedious process of challenging hundreds of signatures on the nominating petitions of Palmer and three other lesser-known contenders for her Illinois state Senate seat. They kept challenging petitions until every one of Obama’s Democratic primary rivals was forced off the ballot.
The Trib account attributes his success to the fact that “when he filed his challenge the city of Chicago had ‘just completed a massive, routine purge of unqualified names that eliminated 15,871 people from the 13th District rolls.’” and his “competitors had ‘relied on early 1995 polling sheets to verify the signatures.’” * Obama himself faced no such challenge.
See, here is where we have to take a step back and look at the realities of how corrupt urban political machines operate…because this sort of outrageous good fortune does not, in machine-controlled cities, ordinarily fall into the lap of candidates who present any threat to the machine. Obama’s opponents all just happened to get shoved off the ballot, leaving him standing unopposed? (Freddoso, at p. 5 & 246 and n. 17, cites 1994 & 1995 press accounts in the Tribune and the Sun-Times indicating that Mayor Daley was worried about Palmer running against him for Mayor, and thus his interests were served by her defeat).
This would not the last time things like this just happened to Obama’s opponents, while Obama himself slid by on the greased skids. It would certainly seem as if Barack Obama has important friends who want him in high places.
There’s also Obama’s 2004 run for the U.S. Senate, a race in which he was generally regarded as something of a longshot (as you may recall – Freddoso cites polls showing this at p. 47 – a little more than three weeks before the March 16, 2004 primary, Obama was in a second-place tie with 17% of the vote). The favorite was Blair Hull, a multi-millionaire who spent $29 million on his campaign (Hull was the subject of a sympathetic Atlantic profile in January 2004 by liberal writer Joshua Green comparing him to Jon Corzine and not even mentioning Obama). But Hull’s campaign unraveled when the Chicago Tribune pressured Hull to release his divorce records, showing a record of menacing his ex-wife including the filing of an order of protection. Now, the Trib was just doing its job as a newspaper – but how did the Trib find out where to look? After all, unsealing divorce records isn’t routine – John Kerry was running for president that year and successfully resisted calls to unseal his divorce papers, without facing much pressure from the big news organizations to do so.
Well, we can make an educated guess and then some: Obama campaign chief David Axelrod had previously interviewed to work for Hull, and Freddoso notes (p. 47-48) that in the process he’d learned about some of Hull’s marital history, although he protests to this day he didn’t tell anybody. As the NY Times notes, “[t]he Tribune reporter who wrote the original piece later acknowledged in print that the Obama camp had ‘worked aggressively behind the scenes’ to push the story.” Axelrod himself is a former Tribune reporter. It’s good to have friends, isn’t it?
Winning the nomination for what was then a Republican-held seat meant Obama would be expected to face off against Jack Ryan, a wealthy and charismatic former investment banker and subject of a famously glowing “is he too good to be true” November 2003 profile by George Will. But Ryan’s campaign, too, imploded when the Tribune persuaded a California judge to unseal Ryan’s divorce records, revealing his actress wife’s testimony about him pressing her to attend sex clubs. (The sympathetic judge was a Gray Davis-appointed Democrat). Again, it was nice for Obama that he had friends, and he was instead able to face off against Alan Keyes in a walkover election. (One cannot miss the irony here of Obama today complaining loudly about any discussion of his own past after using sex scandals to KO his prior opponents).
Of course, speaking of powerful and sinister friends, the fact that Obama had those well-financed opponents at one time enabled him to use a loophole in the campaign finance laws to accept $60,000 in contributions in that campaign from left-wing billionaire George Soros and his family:
Obama … is different from most Democrats because of his willingness to embrace the controversial Soros. Shortly after Soros equated the abuses at the Abu Ghraib prison in Iraq to the Sept. 11 terrorist attacks, Obama joined him for a New York fund-raiser June 7.
The event, held at Soros’ home, boosted Obama’s campaign at a time he was still facing a challenge from Republican Jack Ryan….
Little has been made of his connection to Soros, although it is quite unique. Not only did George Soros donate to Obama’s campaign, but four other family members – Jennifer, sons Jonathan and Robert and wife Susan – did as well.
Because of a special provision campaign finance laws, the Soroses were able to give a collective $60,000 to Obama during his primary challenge.
Then there’s the Chicago Annenberg Challenge, the smoking gun of Obama’s ties to Bill Ayers – documents detailing Obama’s and Ayers’ role in the CAC were held at the Richard J. Daley Library at the University of Illinois at Chicago, but Stanley Kurtz faced a lengthy and frustrating stonewall before he was finally able to get a look at them. (Kurtz also faced intimidation when he took to local radio in Chicago to talk about his research *). Because the one thing Obama’s friends in Chicago don’t want is a close look at his record.
(2) Mr. Jones and Me
You have undoubtedly already heard plenty about Obama’s ties to Wright and Ayers and to Tony Rezko, who I discuss below. But probably the single most important relationship in Obama’s rise, and the one that tells us the most about Obama, is with Emil Jones. As The New Republic’s Ryan Lizza notes, when he arrived in Springfield in 1997, “Obama sought out Jones in the legislature and let him know he was eager to work with him” despite having portrayed Jones in Obama’s first book as an “old ward heeler.” Jones’ background before he was a State Senator? “His career included 30 years on the city payroll, 20 with the Sewer Department, where he retired as an inspector in 1993. He denied wrongdoing when in 1997 the city released federal subpoenas in a ghost-payrolling investigation that included requests for records regarding his employment. He was never charged.” The Chicago Tribune calls Jones “a transparent, old-school advocate of governance as the management of spoils” and notes that in 2002, “after Jones helped engineer the delivery of $4.5 million in taxpayer-funded grants to the City Colleges of Chicago, it was revealed that $300,000 of that money made its way to a firm run by his relatives.”
Republicans controlled the Illinois General Assembly for six years of Obama’s seven-year tenure. Each session, Obama backed legislation that went nowhere; bill after bill died in committee. During those six years, Obama, too, would have had difficulty naming any legislative achievements.
Jones became the State Senate President when the Democrats took the majority in 2003, and basically created most of Obama’s legislative record by adding Obama’s name on other people’s bills. As Jones once said (apparently at Obama’s instigation), “I’m gonna make me a U.S. Senator”:
Jones appointed Obama sponsor of virtually every high-profile piece of legislation, angering many rank-and-file state legislators who had more seniority than Obama and had spent years championing the bills.
“I took all the beatings and insults and endured all the racist comments over the years from nasty Republican committee chairmen,” State Senator Rickey Hendon, the original sponsor of landmark racial profiling and videotaped confession legislation yanked away by Jones and given to Obama, complained to me at the time. “Barack didn’t have to endure any of it, yet, in the end, he got all the credit.
“I don’t consider it bill jacking,” Hendon told me. “But no one wants to carry the ball 99 yards all the way to the one-yard line, and then give it to the halfback who gets all the credit and the stats in the record book.”
During his seventh and final year in the state Senate, Obama’s stats soared. He sponsored a whopping 26 bills passed into law – including many he now cites in his presidential campaign when attacked as inexperienced.
It was a stunning achievement that started him on the path of national politics – and he couldn’t have done it without Jones.
Jones further helped raise Obama’s profile by having him craft legislation addressing the day-to-day tragedies that dominated local news headlines.
(See also Freddoso pp. 27-33. Taking credit for other people’s legislative work is a pattern Obama has continued in Washington). What did Jones get out of the relationship?
So how has Obama repaid Jones?
Last June, to prove his commitment to government transparency, Obama released a comprehensive list of his earmark requests for fiscal year 2008. It comprised more than $300 million in pet projects for Illinois, including tens of millions for Jones’s Senate district.
Shortly after Jones became Senate president, I remember asking his view on pork-barrel spending.
I’ll never forget what he said:
“Some call it pork; I call it steak.”
Mr. Obama secured several million dollars for a project at Chicago State University. Emil Jones Jr., the president of the Illinois State Senate and an early and powerful political benefactor of Mr. Obama’s, has been a dogged champion of Chicago State, and one of Senator Obama’s closest friends.
Freddoso notes at p. 32 & n. 24-25 (citing Obama’s own website and this report) that Obama requested $11 million in earmarks for Chicago State, that Chicago State has named a building after Jones and his wife, and that since 2001, Jones has received about $55,000 in contributions from Chicago State’s trustees, foundation directors and administrators.
What kind of patron is Emil Jones? Freddoso, again, notes (citations at at pp. 28-29 & nn. 5-10 of his book), a variety of questionable projects in which Jones got jobs and funding for his wife, son and stepson:
The Chicago Sun-Times reported last July that his son, Emil Jones III, does not have a college degree, but obtained an unadvertised $57,000 job with the Illinois Department of Commerce. The hire was made shortly after Senator Jones agreed to back Gov. Rod Blagojevich’s (D.) budget plan. The younger Jones is expected to succeed his father in his senate seat.
Jones’s stepson, John Sterling, owns a technology firm called Synch-Solutions, which received a contract for $700,000 of work for the state budget office in 2007. In that same year, the Chicago Sun-Times found that the company had “a $3.5 million contract from the Chicago Aviation Department, a $1.2 million contract from the cash-strapped Chicago Transit Authority and another $1.2 million from the Illinois State Toll Highway Authority . . . [and] a separate $3 million subcontract through Chicago’s public schools.”
In 2005, Governor Blagojevich rescinded the requirement that the director of mental health at the state’s Department of Human Services be a medical doctor. This allowed Jones’s wife, Lorrie, to take the position, with a salary of $186,000 – an $80,000 raise over her previous salary.
While Jones’ backing of Obama’s legislative resume focused on 2003, Freddoso, among others, cites Obama biographer David Mendell to say that on the Illinois ethics reform bill that passed the State Senate in 1998 by a 52-4 vote, “former Rep. Abner Mikva convinced Jones to let Obama handle the legislation. Sen. Dick Klemm (D.) was removed as chief cosponsor and replaced by Obama on May 22, 1998 – the very day the bill passed.” But Obama can take all the credit he wants for that one, when you consider how it led to the final payback for Emil Jones:
Before championing a big legislative pay increase, Illinois Senate President Emil Jones provided himself with tens of thousands of dollars in interest-free loans from his campaign fund.
Under Illinois’ relatively loose campaign-finance laws, there’s nothing illegal about politicians dipping into their campaign funds that way. But it’s highly unusual.
Since 1989, the South Side Democrat has taken out $120,528 in personal loans from his political fund and repaid $96,900 of that amount — leaving nearly $25,000 unaccounted for.
Just last year, Jones withdrew $5,800 from his fund in 20 separate loans of $200 or $300 each between July and December.
In October alone, he had eight disbursements of $300 apiece over a 23-day period.
Last week, Jones sparked criticism when he proclaimed, “I need a pay raise.” That was in support of a pending 12 percent legislative pay raise set to take effect unless legislators took steps to block it. Jones stands to see his salary rise from $91,824 to $102,547.
A government watchdog group questioned whether Jones is using his campaign for personal expenses rather than political ones, under a loophole in a 1998 law that was supposed to ban the personal use of campaign funds.
“It absolutely looks like a slush fund,” says Cindi Canary, director of the Illinois Campaign for Political Reform. “He is living under a whole set of rules that no one else in the public is.”
Jones’ camp declined repeated requests from the Chicago Sun-Times for comment on how he has spent the money from his interest-free loans. A top aide would say only that some of the money was spent on gasoline. Campaign records don’t appear to show what the loans were for. Nor is there anything in the public record stating the terms of the loans.
As chairman of his political fund, Jones decides the loan terms — and whether the loans ever need to be repaid.
“It’s the kind of open-ended float you would not get if you went to a commercial bank and asked for a loan,” says Kent Redfield, a University of Illinois at Springfield political scientist who studied Jones’ records for Canary’s group. “It’s ‘other people’s money.’ [Campaign contributors] don’t give you money to help you out with your lifestyle. They give you money to help you out with your campaign. If you rely on your fund to augment your lifestyle, that’s a conflict of interest.”
* It gets worse: not only was Jones, under the Obama “ethics” bill, able to borrow money from his campaign contributions, he is allowed to keep half a million dollars of it as a golden parachute following his retirement, which was announced in August:
Part of the price for that victory was leaving a major loophole in the law. While new legislators were barred from using campaign money for personal use, those already in office could keep using the campaign money they already had for anything they wanted – Cadillacs, college tuition, whatever.
For instance, Senate President Emil Jones – who helped Obama reach the U.S. Senate – could walk away with as much as $578,000 when he retires next year. He can use that for political purposes or simply spend it as personal income, as long as he pays taxes on it.
You want an illustration of the influence Obama could have exerted for reform if he’d wanted to? Jones spent months bottling up ethics reform legislation in the State Senate, reform with more teeth than the flaccid bill passed by Obama:
Designed as a response to the “pay-to-play politics” that have flourished under Gov. Blagojevich, the plan would bar firms with more than $50,000 in state contracts from donating to the officeholder in charge of the deals.
But the governor entirely rewrote the plan, stripping out that language and putting it in an executive order. In its place, he inserted provisions into the original legislation to deal with how lawmakers award themselves pay raises and to bar the practice by some state officeholders of holding outside, non-elected government jobs.
On Wednesday, the Illinois House rejected Blagojevich’s rewrite, 110-3. Under the state Constitution, the Senate has “15 calendar days” to follow suit, or the plan as originally written will die.
As late as mid-September 2008, Obama was resisting calls to lift a finger to help the real reform bill pass. Finally, after media pressure that crested while Obama was behind McCain in the national polls, he made the call – and the retiring Jones immediately complied: “‘I plan to call the Senate back into session to deal with the issue of ethics only at the request of my friend Barack Obama,’ Jones said in a statement…”
Just think of what Obama might have accomplished in Illinois if he’d made more calls like that.
(3) Married To The Machine
When Obama married Michelle Robinson in 1991, he was literally marrying into the city’s Democratic machine:
[H]er father, Frasier Robinson, spent some time as a maintenance worker for Chicago’s Department of Water Management.
However, he was a good deal more than the labourer that many seem to imagine.
Indeed, according to family friends, Michelle’s father was a volunteer organiser for the city’s Democratic Party, a by-word for machine politics in America, and his loyalty was rewarded with a well-paid engineering job at Chicago’s water plant. Even before overtime, he earned $42,686 – 25 per cent more than High School teachers at the time.
Shortly before the Obamas were married, Michelle went and got a job at the heart of the Chicago machine:
In 1991, she wrote to Valerie Jarrett, deputy chief of staff for Chicago Mayor Richard M. Daley. Jarrett…offered her a job in the mayor’s office. But before Michelle would accept, she asked that Jarrett have dinner with her and Barack.
Barack was worried, according to his biographer, David Mendell, that Michelle might be too straightforward and outspoken to survive in a political setting. He fretted, too, that if she was going to enter the realm of Chicago politics, she needed a mentor, someone to look out for her.
“My fiance wants to know who is going to be looking out for me and making sure that I thrive,” Jarrett recalled Michelle saying. After the meal, Jarrett told the Chicago Tribune, she asked, “Well, did I pass the test?” Barack smiled and said she did.
When Michelle was hired by the Daley administration, she was an assistant to the mayor, making about $60,000 a year. But Jarrett was promoted to head the Department of Planning and Development, and took Michelle with her. Michelle’s new job was “economic development coordinator,” which city records describe as “developing strategies and negotiating business agreements to promote and stimulate economic growth within the City of Chicago.”
From Mayor Daley’s office, with the connection to the very well-connected Jarrett firmly established, Michelle went on to head the Chicago office of Public Allies, a non-profit community organization, from 1993 until 1996, and served on its board until 2001; Barack Obama was a founding member of the board of Public Allies in 1992 *, and would go on to send them taxpayer money:
Senator Obama has trained several classes of Allies in community organizing, spoken at Public Allies Chicago events, and helped Senator Durbin secure an appropriation from the Department of Justice that successfully helped us better recruit and retain young men of color for our Chicago program and learn practices we are applying nationally.
The Chicago-based Muntu Dance Theatre received a $4.5 million grant to help pay for a $10 million cultural center.
Obama’s mentor in Springfield, state Sen. Emil Jones (D-Chicago), sponsored the grant. And at the time $2.25 million of the grant was disbursed, Obama’s wife, Michelle, sat on the non-profit dance group’s board.
Obama said in the interview that at the time of the award in 2003 his wife wasn’t a board member, though tax returns of the charity indicate she sat on the board in 2002 and 2003.
(See also Freddoso p. 31). Notably, the theater’s website now lists Emil Jones as “Honorary Campaign Chair” of the “Campaign for the Muntu Performing Arts Center.”
In 1996, when Barack Obama was elected to the State Senate, his wife moved to a job at the University of Chicago. In 2002, she moved over from the University to its Hospital, where she “developed the University’s first office of community service” and “quickly built up programs for community relations, neighborhood outreach, volunteer recruitment, staff diversity and minority contracting.” Then in 2004, Obama was elected to the U.S. Senate; shortly thereafter, Michelle was given a promotion and a pay raise that more than doubled her salary “from $121,910 in 2004, just before her husband was elected to the Senate, to $316,962 in 2005.” Her new duties would include “all programs and initiatives that involve the relationship between the Hospitals and the community…[and] management of the Hospitals’ business diversity program.” In short, she had yet again a perfect job for deciding who would and would not find favor in the community and local business with a powerful institution – and one that itself sought favor with her influential husband. In 2006, Obama tried to return the favor, requesting a $1 million earmark for his wife’s employer to build a new pavillion (the earmark did not ultimately get passed).
(4) I’m Barack Obama, and I Approve This Machine
There are a number of ways for an honest politician to get in the way of a crooked machine, or of waste or fraud in the government. She can resign in protest, as Sarah Palin did in Alaska. He can hold hearings smoking out members of his own party, as John McCain has done in the Senate. She can back candidates in primary battles against the establishment, as Palin has also done in Alaska. He can bring national attention to self-interested wastes of taxpayer money, as McCain has also done in the Senate. You will look high and low in his record for Obama doing any of these things.
In fact, Obama has repeatedly either sat out opportunities to support reform in Chicago or affirmatively supported the machine. By January 2007, the Justice Department and the Chicago press had laid bare the corruption of the administration of Michelle’s old boss Mayor Daley, including the May 2006 convictions of Robert Sorich, Timothy McCarthy, two of Mayor Daley’s most senior aides, and two sanitation officials for what the New York Times described at the time as running “City Hall’s legendary patronage machine” :
Prosecutors said Mr. Sorich and Mr. McCarthy had concocted “blessed lists” of preselected winners for certain jobs and promotions based on political work or union sponsorship. The scheme involved sham interviews, falsified ratings forms and the destruction of files to cover it up, they said.
* (See also Freddoso, pp. 20-26, discussing the broader pattern of bribery, shakedowns, corruption in city employment and contracting, you name it). Yet Daley, preparing for his 2007 re-election bid, had one voice spinning furiously to direct attention away from the rampant corruption: the man Sun-Times columnist Lynn Sweet calls “Mayor Daley’s key adviser” – David Axelrod, better known now nationally as the guiding strategist and campaign manager for Obama’s presidential campaign. (The NY Times: “‘David Axelrod’s mostly been visible in Chicago in the last decade as Daley’s public relations strategist and the guy who goes on television to defend Daley from charges of corruption,’ Dick Simpson, a former Chicago alderman who is now chairman of the political science department at the University of Illinois at Chicago, told me.”) Freddoso (p. 23 & n. 72) cites a 2005 Philadelphia Inquirer article in which Axelrod declared, a la Mario Cuomo denying the existence of the Mafia, that “The so-called ‘machine’ doesn’t exist anymore.”
As Freddoso recounts (p. 26), while Daley’s position remained strong, he faced two black opponents in the 2007 primary, so an endorsement from the popular Obama would help remove any remaining obstacles to re-election. * Moreover, as NPR noted at the time, before those weaker challengers stepped up, there had been “talk that the corruption issue would lead to some big-name Democrat challenging him this year (Congressmen Jesse Jackson Jr. and/or Luis Gutierrez had been mentioned)” – and Jackson, as we know, is a key Obama ally. But unlike Sean Parnell’s Palin-backed challenge to Don Young in Alaska, Obama apparently didn’t persuade Jackson to run, and may not even have tried. Instead, Obama endorsed Daley, and Daley endorsed Obama for president. One hand washes the other.
Notably, Obama’s one serious intra-party battle in Chicago, his primary challenge to Congressman Bobby Rush in 2000, followed on the heels of Rush challenging Mayor Daley in the primary in 1999 *. David Ignatius of the Washington Post says that Obama was “[p]rodded by the Daley machine” into that race.
In 2006, the Cook County Board President, John Stroger, faced near-daily chronicling of the incompetence, scandal, and patronage under his administration. These revelations included not only the typical employment of family members and friends, but more disturbingly what one Chicago newspaper referred to as a “catalogue of horrors” at a County hospital and what another uncovered at the Juvenile Detention Center where staff encouraged fights among the youth in “the gladiator room”. Although normally untouchable, challenging Stroger was a formidable reform candidate, Forrest Claypool, who had been endorsed by every major paper in Chicago. This ‘machine versus reform’ race provided Obama with a seemingly tailored opportunity to demonstrate his new brand of politics and yet, although Claypool was a senior advisor to him during his Senate race, Obama chose not antagonize the machine and remained silent throughout the campaign, even after Stroger suffered a debilitating stroke a week before the election. Following Stroger’s victory (52% to 48%), local committeemen selected Stroger’s son, Todd, to replace him on the general election ballot, and despite general voter outrage over this cynical act of nepotism, Obama immediately embraced Todd Stroger, calling him a “a good progressive Democrat” who will “lead us into a new era of Cook County government.” To no one’s surprise, since winning the general election, Todd Stroger has hired a plethora of family members and friends, while slashing essential positions and services, including nurses and law enforcement officials, and proposing massive tax increases. When asked about the situation at the County under Todd Stroger, Obama said he was not following it, something he apparently has the luxury to ignore.
(See Obama’s letter supporting Todd Stroger here). Remember Todd Stroger next time someone asks you what Obama’s definition of “progressive” is. And note once again the contrast between Obama’s embrace of Todd Stroger and Palin’s endorsement of a primary challenger to Lisa Murkowski. Why did Obama sit out the primary and back Todd Stroger in the general? Maybe because Obama doesn’t like to rock the boat with powerful machines (How powerful are the Strogers in Chicago? Cook County Hospital is now named John H. Stroger Jr. Hospital) Maybe because Obama’s close friends were also Stroger’s – besides Stroger’s alliance with Mayor Daley, Tony “Rezko had served as John Stroger’s finance chairman and raised $150,000 for him (Stroger put Rezko’s wife on the county payroll).” Or maybe because the Strogers are black and Forrest Claypool is white. No matter how you slice it, Obama put his stamp of approval on Stroger control of Cook County.
But wait! The hits keep on coming. The Tribune again:
In the 2006 Democratic primary… Obama endorsed first-time candidate Alexi Giannoulias for state treasurer despite reports about loans Giannoulias’ family-owned Broadway Bank made to crime figures. Records show Giannoulias and his family had given more than $10,000 to Obama’s campaign, which banked at Broadway.
Giannoulias spoke for Obama at the 2008 Convention. Bad decision? It is rumored that Tony Rezko is now talking to the feds about Giannoulias and his family (Ed Morrissey collects those reports and more background on Giannoulias here).
Freddoso also notes, at p. 19-20, Obama’s 2007 endorsement of Dorothy Tillman, a corrupt, race-baiting Alderman who once brandished a gun at a city council meeting – the Chicago Tribune noted that when Obama endorsed her, Tillman “was then under fire for her stewardship of the scandal-plagued Harold Washington Cultural Center, where contracts benefited members of her family” – what mattered was that she had endorsed Obama in 2004. *
Then there’s Obama’s 2004 endorsement of his poker buddy State Senator Larry Walsh, a guy Obama liked so much he put thousands of Obama volunteers to work campaigning for Walsh. Walsh is now a lobbyist, and Obama has requested $6 million in earmarks for his client. And now, Walsh is under FBI investigation. (As it happens, Walsh was also tied to a Rezko construction project).
Freddoso cites this Ryan Lizza piece quoting an Obama ally:
[Obama] recognizes that Daley is a powerful man and to have him as an ally is important. While he was a state senator here and moving around in Chicago, he made sure to minimize the direct confrontational approach to people of influence and policymakers and civic leaders.
Barack Obama take on the people who run the machine? Not a chance. He’d have to stop endorsing them first.
(5) Rezko and Friends
Yet another of Obama’s closest and earliest political supporters is Tony Rezko, who was convicted in June in federal court in Chicago of corrupting the government of Illinois.
[In 1999, E.J.] Dionne wrote about a young Barack Obama, who artfully explained how the new pinstripe patronage worked: a politician rewards the law firms, developers, and brokerage houses with contracts, and in return they pay for the new ad campaigns necessary for reelection. “They do well, and you get a $5 million to $10 million war chest,” Obama told Dionne. It was a classic Obamaism: superficially critical of some unseemly aspect of the political process without necessarily forswearing the practice itself.
…[Tony] Rezko’s rise in Illinois was intertwined with Obama’s….he had tried to recruit Obama to work for him. Chicago had been at the forefront of an urban policy to lure developers into low-income neighborhoods with tax credits, and Rezko was an early beneficiary of the program. Miner’s law firm was eager to do the legal work on the tax-credit deals, which seemed consistent with the firm’s over-all civil-rights mission. A residual benefit was that the new developers became major donors to aldermen, state senators, and other South Side politicians who represented the poor neighborhoods in which Rezko and others operated. “Our relationship deepened when I started my first political campaign for the State Senate,” Obama said earlier this year, in an interview with Chicago reporters.
Rezko was one of the people Obama consulted when he considered running to replace Palmer, and Rezko eventually raised about ten per cent of Obama’s funds for that first campaign. As a state senator, Obama became an advocate of the tax-credit program. “That’s an example of a smart policy,” he told the Chicago Daily Law Bulletin in 1997….Obama and Rezko’s friendship grew stronger. They dined together regularly and even, on at least one occasion, retreated to Rezko’s vacation home, in Lake Geneva, Wisconsin.
Following the M.O. he explained to Dionne, Barack Obama went out of his way to do favors for Rezko, writing to federal and state officials to get Rezko a lucrative contract to build senior citizen housing:
The deal included $855,000 in development fees for Rezko and his partner, Allison S. Davis, Obama’s former boss, according to records from the project, which was four blocks outside Obama’s state Senate district.
Obama’s letters, written nearly nine years ago, for the first time show the Democratic presidential hopeful did a political favor for Rezko – a longtime friend, campaign fund-raiser and client of the law firm where Obama worked – who was indicted last fall on federal charges that accuse him of demanding kickbacks from companies seeking state business under Gov. Blagojevich.
The letters appear to contradict a statement last December from Obama, who told the Chicago Tribune that, in all the years he’s known Rezko, “I’ve never done any favors for him.”
Among the direct benefits to Obama in return, from his alliance with Rezko? Well, Rezko was in the business of demanding state jobs for people he favored, sending Gov. Blagojevich (who was identified in the indictment of Rezko as “Public Official A” under Rezko’s corrupt influence) a list of 39 people he wanted jobs given to – including “two people who appear to have Obama links and a third who’s now an Obama presidential campaign staffer.” A very valuable thing to have in politics, a man who will arrange jobs for your campaign staff between campaigns.
Obama also got significant campaign contributions from Rezko: “Over the years, Rezko, Mahru, their wives and businesses have given more than $50,000 to Obama’s campaign funds, records show. And Rezko has helped raise millions more.” Rezko’s corruption also extended into Iraq; federal prosecutors have argued that Rezko paid a $1.5 million bribe to get a contract in Iraq, which naturally involved yet another kickback donation to Obama. (Rezko’s corrupt Iraq connections included still seedier and more ominous figures including a Saddam-linked billionaire, although efforts to tie the Iraqi connections to Obama have been speculative at best). To say nothing of a $10,000 contribution in 2004 funded by a recipient of a $250,000 kickback from a corrupt Rezko deal, from a donor whose son was then awarded an internship in Obama’s U.S. Senate office.
Rezko, in fact, himself offered Obama a job straight out of law school in 1991:
He once told the Chicago Tribune that he had briefly considered becoming a developer of affordable housing. But after graduating from Harvard Law School in 1991, he turned down a job with Tony Rezko’s development company, Rezmar, choosing instead to work at the civil rights law firm Davis, Miner, Barnhill & Galland, then led by Allison Davis.
When Obama opened his campaign for state Senate in 1995, Rezko’s companies gave Obama $2,000 on the first day of fund-raising. Save for a $500 contribution from another lawyer, Obama didn’t raise another penny for six weeks. Rezko had essentially seeded the start of Obama’s political career.
Rezko’s projects were not so beneficial to the not-so-well-connected citizens who lived in them, and his predations victimized Obama’s own constituents who were left to live in decrepit housing – and other close Obama allies were similarly involved in developing substandard housing projects:
Valerie Jarrett, a senior adviser to Obama’s presidential campaign and a member of his finance committee. Jarrett is the chief executive of Habitat Co., which managed Grove Parc Plaza from 2001 until this winter and co-managed an even larger subsidized complex in Chicago that was seized by the federal government in 2006, after city inspectors found widespread problems.
Allison Davis, a major fund-raiser for Obama’s US Senate campaign and a former lead partner at Obama’s former law firm. Davis, a developer, was involved in the creation of Grove Parc and has used government subsidies to rehabilitate more than 1,500 units in Chicago, including a North Side building cited by city inspectors last year after chronic plumbing failures resulted in raw sewage spilling into several apartments.
…Rezko’s company used subsidies to rehabilitate more than 1,000 apartments, mostly in and around Obama’s district, then refused to manage the units, leaving the buildings to decay to the point where many no longer were habitable.
Campaign finance records show that six prominent developers – including Jarrett, Davis, and Rezko – collectively contributed more than $175,000 to Obama’s campaigns over the last decade and raised hundreds of thousands more from other donors. Rezko alone raised at least $200,000, by Obama’s own accounting.
One of those contributors, Cecil Butler, controlled Lawndale Restoration, the largest subsidized complex in Chicago, which was seized by the government in 2006 after city inspectors found more than 1,800 code violations.
Butler and Davis did not respond to messages. Rezko is in prison; his lawyer did not respond to inquiries.
Over the next nine years [1989-98], Rezmar used more than $87 million in government grants, loans, and tax credits to renovate about 1,000 apartments in 30 Chicago buildings. Companies run by the partners also managed many of the buildings, collecting government rent subsidies.
Rezmar collected millions in development fees but fell behind on mortgage payments almost immediately. On its first project, the city government agreed to reduce the company’s monthly payments from almost $3,000 to less than $500.
By the time Obama entered the state Senate in 1997, the buildings were beginning to deteriorate. In January 1997, the city sued Rezmar for failing to provide adequate heat in a South Side building in the middle of an unusually cold winter. It was one of more than two dozen housing-complaint suits filed by the city against Rezmar for violations at its properties.
People who lived in some of the Rezmar buildings say trash was not picked up and maintenance problems were ignored. Roofs leaked, windows whistled, insects moved in.
Where was Obama?
Eleven of Rezmar’s buildings were located in the district represented by Obama, containing 258 apartments. The building without heat in January 1997, the month Obama entered the state Senate, was in his district. So was Jones’s building with rats in the walls and Frizzell’s building that lacked insulation. And a redistricting after the 2000 Census added another 350 Rezmar apartments to the area represented by Obama.
But Obama has contended that he knew nothing about any problems in Rezmar’s buildings.
After Rezko’s assistance in Obama’s home purchase became a campaign issue, at a time when the developer was awaiting trial in an unrelated bribery case, Obama told the Chicago Sun-Times that the deterioration of Rezmar’s buildings never came to his attention. He said he would have distanced himself from Rezko if he had known.
Other local politicians say they knew of the problems.
* Doug Ross has a great photo essay on Obama’s blind eye towards Rezko’s abuses. You can read the Obama campaign’s decidedly lawyerly responses here (Sample: “Senator Obama did follow up on constituency complaints about housing as matter of routine. Further questions about their condition should be addressed to the CHA [Chicago Housing Authority]. It is our understanding that, according to CHA, the buildings owned by Rezmar were maintained in good condition and good standing.” Because, you know, the Chicago government is always diligent and trustworthy where guys like Rezko are concerned.)
Obama, while on the board of the charitable Woods Fund, steered $1 million to Davis. He was, of course, not just a low-income housing developer but also the boss who had given Obama a job out of law school:
Obama began serving on the Woods Fund board in 1993, the same year he was hired as an associate lawyer with Davis’ small Chicago law firm, Davis Miner Barnhill. Obama kept working there until he was elected to the U.S. Senate in 2004.
The grant to Davis is intertwined with Obama’s effort to steer taxpayer money to Rezko:
As a developer, Davis’ partners have included Tony Rezko, the now-indicted political fund-raiser who has been among Obama’s biggest political supporters.
A few months after Davis left the law firm, Obama won his first political office — a seat in the Illinois Senate. His campaign contributors included Rezko and Davis.
Two years later, Obama wrote to city and state officials, urging them to give money to New Kenwood LLC, a company that Davis and Rezko formed to build an apartment building for low-income seniors at 48th and Cottage Grove.
Davis and Rezko were building that project in 2000 when Davis approached the Woods Fund, seeking its investment in future projects.
Consider what Obama got out of working for Davis’ firm. In 2007, during the primaries, Obama cracked at John Edwards’ expense that his preference for making change rather than money was “why I didn’t become a trial lawyer.” But of course Obama was, technically, employed by a trial-lawyer firm, and participated in class action filings against big corporations. But in so many ways, the job seems to have been little more than a sinecure for an aspiring politician – hence the time off to run a voter-registration drive to help a Democrat get elected to the US Senate, hence the time off to go to Indonesia to finish his book, hence keeping him on the part-time payroll while in the State Senate, hence Obama’s secrecy about what particular clients he represented.
As for Rezko, he too was no ordinary donor or bundler for Obama; it was Rezko whose help was necessary to help Obama buy his home, the place where his wife sleeps and his children play with their toys:
Two years ago, Obama bought a mansion on the South Side, in the Kenwood neighborhood, from a doctor. On the same day, Rezko’s wife, Rita Rezko, bought the vacant lot next door from the same seller. The doctor had listed the properties for sale together. He sold the house to Obama for $300,000 below the asking price. The doctor got his asking price on the lot from Rezko’s wife.
Last year, Rita Rezko sold a strip of that vacant lot to Obama for $104,500 — a deal Obama later apologized for, acknowledging that people might think he got a favor from Rezko. Obama called the episode “boneheaded” and a “mistake.”
* In fact, the adjacent property fairly clearly was not of any independent use to Rezko. Basically, Rezko’s wife’s purchase of the lot had no purpose other than to subsidize Obama’s mansion. A payoff that hits, literally, close to home for Obama.
Patrick Fitzgerald’s prosecutorial net has been closing of late around Rezko and his corrupt circle. Gov. Blagojevich has admitted that he’s been interviewed multiple times by federal investigators. (Naturally, Obama endorsed Blagojevich’s re-election in 2006). Rezko is now talking to federal prosecutors, and federal investigators apparently now think they have enough to indict Gov. Blagojevich himself. “[F]ederal agents are preparing charges of tax fraud, conspiracy and obstruction of justice against the governor… involving alleged trading of jobs for five-figure campaign donations” and Blagojevich’s wife receiving “$200,000 in real estate commissions – some on deals done with the convicted Tony Rezko [that] allegedly coincided with the award of state contracts by her husband’s administration” Even some Illinois Democrats have had talk of impeaching Blagojevich.