Tuesday, June 10, 2008
The Wall Street Journal is reporting today that Obama VP vetter Jim Johnson, who once headed up the government mortgage company Fannie Mae, was getting fat loans from his good buddies at Countrywide, the mortgage broker that is under federal investigation for criminal activity.
Top Obama Insider Tied To Countrywide, Ran Fannie Mae
One of Barack Obama top talent scout is deeply tied to the mortgage overload mess. Jim Johnson is one of three people appointed by Obama the head up the search for his vice presidential selection. The problem is that Johnson took at least five real estate loans totaling more than $7 million from Countrywide, the Wall Street Journal reported on Saturday. The loans to ohnson were made through an informal program for friends of the company's CEO, Angelo Mozilo, and were made at substantial discounts to prevailing market rates.
Johnson ran Fannie Mae from 1991 to 1996, and appointed Mozilo to Fannie Mae's advisory board in 1996. He reportedly made $21 million in one year while working for Fannie Mae. So he didn't exactly need that friends and family discount.
"That's the problem with bringing a Washington, DC, insider on board," ABC's Jake Tapper observes. "They're sometimes covered with the goop from the insides of Washington."
Eeks! Somehow, the regular media assholes (except for The Dimbulb at MSDNC) are covering this story, and making Obama look like the moron that he is.
When Obama came out in a press conference and defended Johnson, the media went nuts - for a change.
So, Johnson is only "tangentially" tied to the campaign. Heck, maybe Obama is "tangentially" tied to his campaign as well!
In response to another poor press conference where he could not get a crowd to cheer to "change" and "hope," the the media started to dig - and found gold.
First, US News & World Report slams Obama:
Barack Obama's Mounting Ethical Tone Deafness, Now With Jim Johnson's Mortgage Scandal
You have got to check out the lead editorial in today's Wall Street Journal. Sen. Barack Obama's tone deafness on unethical conduct is absolutely stunning.
In sum, the piece notes that Jim Johnson, one of the three people Sen. Obama chose to help him select his vice presidential running mate, received below-market interest-rate mortgages from Countrywide Financial while he was the CEO of Fannie Mae, and did not disclose the sweetheart deals to Fannie's board. This while he was pulling down $21 million in pay. Obama has called Countrywide's CEO—who arranged the special loans for Johnson—one of the people responsible for the mortgage crisis.
Compounding his problems, Obama has reacted in a manner that can only be called cavalier. From the Journal's editorial:
Yesterday, ABC News asked Mr. Obama whether he should have more carefully vetted Mr. Johnson and Eric Holder, who is working with Mr. Johnson on veep vetting. Correspondent Sunlen Miller noted Mr. Johnson's loans from Countrywide and Mr. Holder's involvement as Deputy Attorney General in the Clinton Administration in the pardon of fugitive Marc Rich. Said Mr. Obama: "Everybody, you know, who is tangentially related to our campaign, I think, is going to have a whole host of relationships. I would have to hire the vetter to vet the vetters."
This type of dismissive response to the campaign's growing list of corrupt allies, policy 180s, and broken promises is troubling at best and self-destructive at worst. Sen. Obama called himself "bone headed" for buying property at a discount from developer Tony Rezko. He should have sold the property back to Rezko for what he paid for it and repurchased it at market value.
Before he realized he could raise record amounts of money, Obama promised to accept federal financing for his campaign. Now that he's secured the nomination, he won't respond to Sen. McCain's calls to live up to that pledge. As reported by the New York Times, Obama outright lied to an Iowa audience this winter about passing a nuclear regulatory bill that never passed the U.S. Senate. Then, he accepted nearly a quarter-million dollars in campaign contributions from nuclear industry executives, while they lobbied him on the bill. What is the difference between that and accepting registered lobbyists' PAC money?
When is the GOP and when are the mainstream media going to notice? The Wall Street Journal is a good starting point.
As we like to say, HO-LY SHIT, BATMAN!
Next, The Washington Post had what to say:
Obama Defense of Johnson Raises Questions
The most important decision Barack Obama will make between now and the November election is the selection of a vice presidential running mate. That makes all the more remarkable his effort Tuesday to suggest that the people he has put in charge of helping make the decision are somehow not really part of his campaign.
Obama is on the defensive over his selection of James A. Johnson, the former CEO of Fannie Mae, to help lead the vice presidential search process, a role he played for John F. Kerry four years ago.
Johnson is drawing fire over his jumbo home loans from Countrywide Financial, a major actor in the subprime mortgage mess, that may have been below market rates. The loans were first reported by the Wall Street Journal. Johnson also has drawn criticism in the past for his role in generous compensation packages to executives of companies on whose boards he served.
At a news conference in St. Louis yesterday, Obama was asked about Johnson and the fact that the candidate has often criticized the activities of Countrywide. Rather than defend his choice, he sought to suggest that the role Johnson is playing is only tangential to his campaign and that it is impossible for the campaign to vet the vetters.
"Jim Johnson has a very discrete task, as does Eric Holder [another member of the VP search team], and that is simply to gather up information about potential vice presidential candidates," Obama responded. "They're performing the job well. It's a volunteer, unpaid position and they're giving me information, and I will then exercise judgment in terms of who I'll want to select as a vice presidential candidate. So these are folks who are working for me, not people who I have assigned to a particular job in the future administration, and ultimately, my assumption is, is that this is a discrete task they'll be performing over the next two months."
The distinctions Obama tried to draw raise other questions. Is he suggesting that Johnson, who is not paid, is exempt from campaign strictures that might apply to the lowliest paid staffers? Is he suggesting that Johnson, while overseeing some of the most sensitive work underway in the campaign, will act merely as a transmission belt for information scooped up from any and all available sources? Is he suggesting he would not select Johnson for a role in his administration? Or that different rules would apply to those he might select than those who play central roles in the campaign?
Johnson can certainly defend himself, if he needs defending. He is a skilled and discreet Washington insider and veteran political powerbroker whose advice and judgment are valued by people like Obama and Kerry and scores of other powerful politicians and business executives. Nor are all the details of the Countrywide transactions known, although the Journal story said Johnson received a favorable interest rate. A lawyer for Johnson told the Journal that the loans were within standard practice in the industry, given someone "of Mr. Johnson's background."
All of this will be sorted out in the days ahead. But in the meantime, for Obama to suggest that Johnson is floating in some outer orbit of his campaign raises questions about the candidate's willingness to deal forthrightly with controversy. Presidential candidates long have turned to trusted and loyal advisers and potential administration officials to help run vice presidential search operations. Is there any reason to think Obama has not done the same?
It looks like Obama stepped in the dog shit and now is shocked that his shoes smell bad.
The countdown is on...how long before Obama, feeling the heat, throws Johnson under the bus? Anyone want to bet this lasts but a few days?