President Obama’s friends, three years ago

This time three years ago, Investigate magazine previewed where Barrack Obama’s presidency had come from and where it might be going. We ended the article with this comment: “It remains to be seen whether his deeds will ever match his rhetoric, or whether Obama’s carefully crafted image was nothing more than a cynical PR stunt to leverage himself into the world’s most powerful job.”

Saint or Sinner?
The Obama mystery builds
Investigate Jan 09

On 20 January, Barack Obama will become America’s 44th president. But already he’s mired in scandal, and his supporters are becoming nervous about his ties to ‘Big Washington’ and his right-wing political appointments. IAN WISHART backgrounds the transition dramas unfolding around Obama

If you believed the media hype over the past year, Barack Hussein Obama was nothing short of the Second Coming – a political rock star of messianic proportions capable of, in his own words, lowering the sea levels and ending global warming:

“This was the moment when the rise of the oceans began to slow and our planet began to heal,” Obama told a cheering crowd in July.

“A nation healed, a world repaired!…We are the ones we’ve been waiting for…I have become a symbol of America returning to our best traditions.”

When you look at it in print, the words seem almost corny. If John Key had uttered them, or Kevin Rudd, voters in Australia or New Zealand would have rolled all over the floor laughing, but when Obama intoned them the world sighed collectively like infatuated schoolgirls.

Some commentators have even gone so far as to suggest Obama’s speech patterns and vocal tones are similar to those used by hypnotists, and essentially mesmerise listeners into happily accepting whatever he says simply because they enjoy listening to his oratory.

There’s nothing sinister in the assertion – many great speakers have a similar effect and it may be the explanation as to why their speeches are so memorable.

If there’s such a thing as a political perfect storm, Obama is it. Black, and white. African, yet raised an Asian, educated in the Pacific, nominal Christian but nominally Muslim too. ‘Transcendent’ would be another adjective capable of execution in this equation.

As a tail-end baby-boomer, Obama is close enough to the first Gen-Xers to have bridged a generational divide. When George Bush leaves the oval office in a few weeks, he’ll likely be the last full baby-boomer in office. Now that’s change you can believe in!

Obama, like John Key in New Zealand and Rudd in Australia, benefitted hugely from the unpopularity of an incumbent leader, although to be sure for a while there the US election was a close-run thing. John McCain’s choice of Sarah Palin as a running mate energised the Republican party and will likely see a lurch away from the cynical internal deal-making that’s marked the Bush years towards a more conservative grassroots suite of policy platforms.

It wasn’t until the financial markets crashed that Obama’s poll fortunes recovered. Suddenly McCain looked too old to be burdened with the responsibility of leading through a recession, and his pitch wasn’t helped by some strategic blunders on the economic crisis.

But while Obama played heavily on his progressive, “change” theme – a tactic that ultimately won the confidence of voters tired of the Washington establishment – liberals have been devastated that most of Obama’s cabinet appointments post-election have been right-wing establishment icons.

As just one example, President Bush’s Defence Secretary, Robert Gates, has been re-appointed to the post by Obama. Most of the other appointments are heavyweights from the Clinton and Bush years – far away from the promise of changing the face of Washington politics.

There are soundings of unease across the liberal blogosphere and in newspapers like the Washington Post, but Obama is still in his official honeymoon period and hasn’t even taken office yet – making it hard for supporters to be openly rebellious. Yet.

But it is Obama’s roots in the corrupt Chicago political machine which have burned him before he’s even taken the oath. On December 9, the FBI moved against Illinois state governor Rod Blagojevich (pronounced Blah-goy-a-vich) on corruption charges.

Obama’s supporters, like Ben Smith at the US website Politico, have tried to paint Obama as neutral, and more or less untainted by Chicago’s notorious corruption.

“Unlike many others, Obama has not enriched himself off the machine; the closest he came was accepting Tony Rezko’s apparent help in buying a house.”

But others commenting on Smith’s blog are far from convinced:

“Did you forget the position that Michelle Obama received after Obama won the Senate seat? In January of 2005 Barack Obama became a freshman United States senator. In March of 2005 Mrs. Obama received a promotion at her place of employment, the not-for-profit University of Chicago Hospitals. Prior to the promotion, she was a hospital administrator earning $121,910 annually. Her promotion provided her with a title — Vice-President for Community and External Affairs — and a salary of $316,962. There is no coincidence here. There is absolutely no doubt that Mrs. Obama received a salary increase of $195,052 simply because her husband had become a senator. If one denies the causal relationship between the two events, then one has decided to allow their politics to cloud their judgment. The position of Vice-President for Community and External Affairs did not exist prior to the creation of the position for Mrs. Obama, and now that Mrs. Obama has resigned from the position in order to campaign for her husband, the hospital has not seen the need to fill the open position. To suggest that Mrs. Obama’s work efforts had suddenly justified a weekly increase in pay of $3751 is ludicrous.”

But the University of Chicago Hospitals’ generosity in nearly tripling the pay of Senator Obama’s wife was not forgotten by Obama: in 2006 he applied to Washington for a one million dollar grant in extra taxpayer funds for the University, later denying it had anything to do with the fact his wife was by now a Vice President at the institution.

It is significant that Valerie Jarrett, who served as Barack Obama’s finance chair for his 2004 Senate campaign, was also Vice President of the University of Chicago Hospitals’ Board of Trustees at the time of Michelle Obama’s massive pay hike. Described as one of the Obamas’ “closest friends”, Jarrett was also a former employer of Michelle Obama, and has this month been named as another White House advisor to Obama, after earlier seeking the nomination for Obama’s vacant senate seat.

Antoin ‘Tony’ Rezko is another fascinating case study. The Syrian-born property developer is currently in jail after being convicted of corruption crimes.

Obama’s relationship with Rezko dates back to 1990, when Obama’s lawfirm began representing Rezko’s company Rezmar. The work paid off – Rezmar secured some US$43 million in government funding. So when Obama first ran for political office in the mid 90s, the very first donations he received were from companies associated with Tony Rezko. Rezko would end up contributing around a quarter million dollars of his own money over the years, but helped raise millions in campaign contributions from well-heeled and well-connected donors.

Public records disclose that in return for raising the money, Rezko would supply Obama with “clout lists” of people he wanted appointed to public positions, or given public contracts where possible.

As a parody of “change you can believe in”, it is an interesting historical fact that Rezko has fundraised for both Obama, and President George W. Bush – a sign perhaps that both men were insiders of the political establishment.

Obama’s boss at the lawfirm, Allison Davis, later went directly into business with Rezko, and Davis/Rezko then ended up working for Obama’s mentor Valerie Jarrett in various public housing projects; it all ended in tears.

“According to press reports, housing projects operated by Davis and Rezko have been substandard and beset with code violations,” reported Washington DC blog The Hill recently. “The Chicago Sun Times reported that one Rezko-managed housing project was ‘riddled with problems — including squalid living conditions…lack of heat, squatters and drug dealers’.

“As Chief Executive Officer of the Habitat Company Jarrett also managed a controversial housing project located in Obama’s former state senate district called Grove Parc Plaza. According to the Boston Globe the housing complex was considered ‘uninhabitable by unfixed problems, such as collapsed roofs and fire damage…In 2006, federal inspectors graded the condition of the complex an 11 on a 100-point scale – a score so bad the buildings now face demolition’. Ms. Jarrett refused to comment to the Globe on the conditions of the complex.”

Remember, these are projects built with taxpayer funds where lots of people clipped the ticket and not much cash was spent on the actual accommodation for low income people.

In October 2006, Rezko and another Obama fundraiser, Stuart Levine, were indicted on criminal charges for extorting millions from firms wanting to do business with several state agencies in Illinois. In what’s become known as “pay to play”, Rezko promised political influence and lucrative contracts for companies who “donated” money – those who refused missed out. Investigators have discovered at least some of those extorted monies ended up in Obama’s campaign funds, forcing the Obama camp to refund the cash.

Levine pleaded guilty and cut a deal, and Rezko was found guilty midway through 2008. He is reportedly also trying to cut a deal to reduce his sentence in return for testifying against others, including Democrat Governor of Illinois Rod Blagojevich.

But if Rezko chooses to sing, he may ultimately be singing about America’s new president. Rezko and Obama were close enough for Rezko to help Obama buy a house for $300,000 less than the asking price by arranging to purchase the neighbouring lot from the same vendor on the same day as well, and then selling a portion of it to Obama afterwards.

“Rezko definitely did Obama a favor by selling him the 10-foot strip of land, making his own parcel less attractive for development,” reported columnist Mark Brown in the Chicago Sun-Times.

For his part, Obama admitted it looked dodgy – “I consider this a mistake on my part and I regret it”.

Then there’s the developing scandal of disgraced Illinois Governor Rod Blagojevich, arrested December for allegedly trying to ‘sell’ Obama’s vacant seat in the Senate to the highest bidder. Under the Illinois constitution, the Governor has sole responsibility for filling the seat with a nominee of his choice, but transcripts released by the FBI are damning.

On Nov. 5, while discussing his authority to name Obama’s replacement, Blagojevich said Obama could use his influence to name the governor to a lucrative spot with a private foundation. Blagojevich told Adviser A: “I’ve got this thing and it’s (expletive) golden, and, uh, uh, I’m just not giving it up for (expletive) nothing. I’m not gonna do it. And, and I can always use it. I can parachute me there.”

According to the Chicago Tribune, based on leaks from the FBI, “Advisor A” is none other than Obama’s Whitehouse Chief of Staff, Rahm Emanuel.

During a two-hour telephone conversation with various people on Nov. 12, Blagojevich talked about securing high-paying jobs for him and his wife in exchange for the Senate seat. He said he is “struggling” financially and does “not want to be governor for the next two years.”

An approach was evidently made to Obama’s team, who named their preferred candidate but offered no immediate cash.

Blagojevich said advisers are telling him he has to “suck it up” for two years and give this (expletive) (Obama) his senator. (Expletive) him. For nothing? (Expletive) him.”

Blagojevich raised the idea of creating a nonprofit group for him to lead. On Nov. 11, he asked Adviser A if “they” (believed to be Rahm Emanuel and by implication Obama) “can get Warren Buffett and others to put $10, $12 or $15 million into the organization.”

During a conversation with his own adviser John Harris on Nov. 11, Blagojevich said he knew Obama wanted Senate Candidate 1 [Obama’s friend Valerie Jarrett] for the open seat but “they’re not willing to give me anything except appreciation. (Expletive) them.”

The next day, Valerie Jarrett mysteriously withdrew her name from the senate nomination list, for reasons that no one has yet explained. Did Obama’s team warn her that Blagojevich wanted money for her appointment and that they wouldn’t be paying, so “forget the gig”?
Instead, Obama named Jarrett to a position inside his advisory staff.

On Nov. 12, Blagojevich told Harris his decision about the open Senate seat would be based on three criteria in the following order of importance: “(O)ur legal situation, our personal situation, my political situation. This decision, like every other one, needs to be based upon that. Legal. Personal. Political.”

On Dec. 4, Blagojevich told Adviser B he was going to give Senate Candidate 5 greater consideration for Obama’s seat because the person would raise money for Blagojevich if he ran for another term as governor.

In an earlier telephone conversation recorded on Oct. 31, Blagojevich described an approach by an associate of Senate Candidate 5 as ” ‘pay to play.’ That, you know, he’d raise 500 grand. An emissary came. Then the other guy would raise a million, if I made him (Senate Candidate 5) a senator.”

Blagojevich told Fundraiser A on Dec. 4 that if Senate Candidate 5 wanted to be appointed to Obama’s seat, the candidate should follow through on promises to raise money for Blagojevich. “(S)ome of this stuff’s gotta start happening now … right now … and we gotta see it. You understand?” But Blagojevich told Fundraiser A that “you gotta be careful how you express that and assume everybody’s listening, the whole world is listening. You hear me?”

Senate Candidate 5 has now been confirmed as Jesse Jackson Jr, son of the Reverend Jesse Jackson. Junior denies offering money for the senate seat.

But the Times of London, and the Chicago Tribune, have further details of just what kind of horsetrading went down:

“Jesse Jackson Jr, the Congressman son of the famed civil rights leader, also faced new questions yesterday about his quest for Mr Obama’s vacated Senate seat.

“A group of ethnic Indian businessmen with ties to Mr Jackson and Mr Blagojevich reportedly held a lunch on October 31 and discussed raising $1 million for the Governor’s campaign to encourage him to pick Mr Jackson as Senator, the Chicago Tribune said.

“Raghuveer Nayak, a major Blagojevich donor who also has ties to the Jackson family, then co-sponsored a fund-raiser for the Governor on Saturday attended by Mr Blagojevich and Jesse Jackson Jr’s brother Jonathan, the newspaper said.

“Mr Nayak, a leader of Chicago’s Asian community, owns a string of surgery clinics and was once involved in a land deal with Jonathan Jackson.

“Mr Jackson Jr met Mr Blagojevich at 4pm on Monday to discuss his interest in the Senate seat. Mr Blagojevich was arrested at his home at 6am on Tuesday by prosecutors who said they were trying to thwart a “political crime spree”. Jesse Jackson Jr is due to meet prosecutors next week, but has been told he is not a target of the investigation.”

Obama, too, has denied having discussions with Blagojevich on the senate seat, but his credibility’s been undermined by comments from his own adviser, David Axelrod, to Fox News on November 23:

“I know he’s talked to the governor and there are a whole range of names many of which have surfaced, and I think he has a fondness for a lot of them,” Axelrod said on the record.

Obama’s team now claim Axelrod “misspoke”, but commentators are more sceptical. And with good reason. The ties between Obama and Blagojevich are significant.

On July 21st this year, The New Yorker’s Ryan Lizza reported on Obama’s position as adviser to Governor Blagojevich in his successful 2002 gubernatorial campaign:

“That year, [Obama] gained his first high-level experience in a statewide campaign when he advised the victorious gubernatorial candidate Rod Blagojevich, another politician with a funny name and a message of reform,” wrote Lizza.

Rahm Emanuel, now Obama’s Chief of Staff, told the magazine that he and Obama were among “the top strategists of Blagojevich’s 2002 gubernatorial victory”.

Again, the Obama camp now insists Emanuel “overstated” Obama’s role.

It’s hard to see how, though. In 2006, despite controversy swirling around Governor Blagojevich, Obama continued to endorse him, as he told journalist John Patterson in the Chicago Daily Herald of July 27:

“If the governor asks me to work on his behalf, I’ll be happy to do it.”

An Associated Press report of August 16, 2006 quoted Obama:

“We’ve got a governor in Rod Blagojevich who has delivered consistently on behalf of the people of Illinois.”

Then there’s the massive embarrassment for the President-elect of his own Chief of Staff, Rahm Emanuel, being caught on FBI wiretaps discussing Blagojevich’s plans for the Senate seat.

Obama may not personally be snared, but there’s the overriding impression he knows far more than he’s admitted to date:

“So we’re left with vagueness,” writes Slate’s John Dickerson. “Why does it matter? It always matters when a politician won’t say the simple thing. Maybe it matters a little more with Obama, who can answer the dickens out of a question when he wants to. There’s evidence that Obama wanted Valerie Jarrett to take his seat—the governor sure seemed to think the president-elect wanted that. Suddenly, in the middle of the process, Obama stopped wanting that. Why?”

And before it became clear that Rahm Emanuel was implicated, CNN’s Campbell Brown was sounding off about Obama’s vagueness as well:

“And what now looks pretty clear, at least based on these tapes and what the U.S. attorney is telling us, is that someone from Obama-world did have communication with the governor about this.

“Who was it? What was said?

“Attempts by CNN reporters and others to get answers have been met with a big: “no comment due to an ongoing investigation.”

“Sorry, but that’s not good enough for someone who ran a campaign based in part on a promise of more openness and transparency. At the very least you could have assured that you and your staff are getting to the bottom of this and fully cooperating with the investigators.

“After all, we can figure some of this out on our own.

“It seems pretty clear that Valerie Jarrett, soon to be one of Obama’s top White House advisers, was at one time on Blagojevich’s shortlist to take Obama’s Senate seat, and that there was some communication between Blagojevich and someone in Obama-world — someone who allegedly conveyed to the governor that all he would ever get from Obama was appreciation.

“So who was this point-person on Obama’s team? Did they know what Blagojevich was allegedly up to? And did they tip off investigators? Or did they know the governor was allegedly soliciting bribes and did nothing?

“These are unanswered questions,” said CNN.

“There are other puzzling questions,” agrees conservative commentator Pat Buchanan.

“Why, if [prosecutor] Fitzgerald was listening to the wiretaps and laying his trap for the governor and corrupt politicians interested in buying a U.S. Senate seat, did he abort the operation with his 6 a.m. arrests of Blagojevich and his chief of staff? Why spring the trap when the mouse is just outside, mulling over whether to go for the cheese?

“Why not let the plot unfold? Why not let the corrupt bidder for a Senate seat make a solid offer and bring in his or her down payment? Why not wait for the felony to be committed instead of acting while it was still being considered and discussed?

“This one is not going away soon.

“Forty-eight hours into the scandal, we have a governor and chief of staff arrested in their homes for attempting to sell the U.S. Senate seat of the 44th president of the United States. And one of the most famous names in politics, Jesse Jackson Jr., has hired a lawyer and been placed under a cloud of suspicion that some benefactor tried to buy him the Senate seat he coveted.

“No one is yet convicted of anything. But if this scandal touches any member of Obama’s White House staff, who may have spoken with Blagojevich and listened to his solicitation of a bribe without reporting it, we are going to have a new special prosecutor in Washington, D.C.”

On 20 January Barack Hussein Obama will be sworn in as the 44th president of the United States. Elected on a wave of popular, anti-Bush sentiment, and pitching himself as a candidate of change, he nonetheless is shaping up as more a creature of the Establishment than even George Bush was.

It remains to be seen whether his deeds will ever match his rhetoric, or whether Obama’s carefully crafted image was nothing more than a cynical PR stunt to leverage himself into the world’s most powerful job.