While Sen. Barack Obama’s campaign and the Democratic National Committee are hammering away at Sen. John McCain’s ties to lobbyists, the McCain campaign is firing back. The McCain camp’s new blog cites a weekend story from The Wall Street Journal about Jim Johnson, former CEO of the federally sponsored lender Fannie Mae, whom Obama just named to a panel set up to vet potential vice presidential candidates. The Journal reported that Johnson, who left Fannie Mae during a 2004 accounting scandal, received several loans at below-average interest rates from the troubled financial firm, Countrywide. The loans in question were handled through a special program for friends of Countrywide CEO Angelo Mozilo. According to The New York Sun, Johnson received three loans totaling $7 million. The WSJ article does not allege any laws were broken:
There is nothing illegal about a mortgage firm treating some borrowers better than others. But if Fannie Mae officials received special treatment, that could cause a political problem for the government-sponsored, shareholder-owned company.
Its code of conduct, a spokesman said, "requires the disclosure of potential conflicts of interest and prohibits acceptance of substantial gifts, including loans with preferential terms, from an organization seeking to do business with the company without prior review and approval by the company." The spokesman said the code has been in effect since the early 1990s.
As for Countrywide, "I think it is potentially an accountability and internal controls issue," securities lawyer John Olson of Gibson, Dunn & Crutcher said. A comparison of the Fannie Mae officers’ terms with interest rates prevailing when they got their loans raises the possibility Countrywide gave them preferential terms. But it’s impossible to tell for sure from public documents. An array of other factors also can account for lower-than-average rates, including a borrower’s income, total assets and credit score; how big the loan is compared with the home’s value; and how many "points" a borrower may have paid upfront in order to get a lower rate.
Still, the revelations could prove politically damaging to the Obama campaign, which has criticized Countrywide and its officers for their role in the subprime lending crisis. Sensing an opening to attack the presumptive Democratic nominee on the ethics of his associates, the Republican National Committee issued the following statement:
"Barack Obama routinely rails against lobbyists and corporate insiders, yet his campaign is stocked with both. Now it turns out that the man leading his vice presidential selection team is receiving highly questionable loans. With millions of Americans struggling to pay their mortgages, it raises serious questions about Obama’s judgment when we learn members of his campaign leadership are receiving favors that the average American would never get. With Obama discussing the economy today, he needs to stand up and address the mortgage scandals within his campaign."
These revelations come hot on the heels of last week’s conviction of Antoin Rezko, a longtime Obama fund-raiser, on 16 felony corruption charges. While none of the charges were related to Rezko’s relationship with Obama, the RNC was quick to pounce, immediately setting up a Website with links to stories about the verdict and Obama’s connection to the Chicago businessman. Less than one week after Obama apparently secured the Democratic nomination, the campaign — on both sides — is getting nasty. It’s going to be a long, hot summer.
MA-Sen: 150 Conservative Bloggers Fan Out, Looking for Scandals
BOSTON -- The mysterious Election Journal blog, which first released the infamous 2008 video of two bumbling New Black Panther Party members waving nightsticks
MA-Sen: 66 to 19
BOSTON -- That, via Alex Isenstadt and Josh Kraushaar, is the number that defined the Massachusetts Senate race more than anything else. From the primary
MA-Sen: A Text Message From Scott Brown
BOSTON -- Having signed up for Scott Brown’s text message service for election day, I just got this text: Are you about to have lunch? It’s a great time to
MA-Sen: Loyal Democrats Grouse About Coakley
BOSTON -- A little while after noon, a steady crowd of Democratic voters streamed into the Cathedral High School Gymnasium to cast votes for their party’s
MA-Sen: Brown Wins
BOSTON -- At 9:20, the first rumors of Scott Brown’s victory in the Massachusetts Senate race started to work around the room. A moment later, Doug Flutie
MA-Sen Photos: ‘Paint the Town Red! Croakley’s Dead!’
Below are some photos of yesterday’s People’s Rally in Worcester, the rally that Brown held to counter-program the Obama rally in Boston. The crush of
MA-Sen: Out-of-Staters for Brown
BOSTON -- A surprising discovery at yesterday’s People’s Rally in Worcester was just how many people had traveled into the state to assist, in whatever way,
Menendez, Lautenberg to Continue BP-Lockerbie Investigation
Sens. Robert Menendez and Frank Lautenberg, both New Jersey Democrats, will continue to seek details about BP’s alleged involvement in the release last year of
Net Investors Bullish on Palin’s Prospects for Staying on Ticket
Just for fun, the Internet prediction Website Intrade has opened a contract on whether Alaska Gov. Sarah Palin will be withdrawn as McCain’s running mate.
No Experience Necessary
Gov. Sarah Palin’s a middle-class hockey mom, but does that really qualify her to be vice president?