If you’ve read my Integrity Gap series on Barack Obama, or lengthier treatments like David Freddoso’s book, you will be familiar with what was probably the most scandalously under-reported story of 2008, which is President-Elect Obama’s deep and longstanding ties to machine politics in Illinois, most notably to the Daley machine in Chicago. You’ll also recognize two other key themes: Obama’s ties to politically well-connected housing interests ranging from slumlords like Tony Rezko to Beltway powerhouses like Fannie Mae and Freddie Mac to ACORN, and Obama’s practice of providing official favors to his benefactors.

Last week we saw the first sign of these dynamics playing out in Obama’s first staff hire, Chief of Staff Rahm Emanuel, a Chicago pol and former “senior adviser and chief fundraiser” for Mayor Daley who made hundreds of thousands of dollars sitting on Freddie Mac’s board during a time when the board was criticized by the SEC for failing to stop the company’s accounting irregularities and shady campaign donations.

Now, the second act: Obama reportedly wants Gov. Rod Blagojevich, a/k/a “Public Official A” in the Rezko indictment, to appoint as his replacement in the U.S. Senate Valerie Jarrett, the co-head of Obama’s transition team. Jarrett, of course, is a former Daley aide and Chicago housing developer who gave Michelle Obama her first big job working for Mayor Daley.

Let’s recall Jarrett’s involvement in Grove Parc Plaza, one of the conspicuous failures (at least from the perspective of the tenants, rather than the developers) among the housing projects built by Obama’s friends:

Among those tied to Obama politically, personally, or professionally are:

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.

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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.

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Jarrett, a powerful figure in the Chicago development community, agreed to be interviewed but declined to answer questions about Grove Parc, citing what she called a continuing duty to Habitat’s former business partners….

Yet again, a reminder that Obama’s “new politics” is just a new name for the oldest kind of politics there is.