Here's what the "new kind of politician" said recently:
Too many S&Ls took advantage of the lax rules set by Washington to gamble that they could make big money in speculative real estate. . . . [T]hey made hundreds of billions in bad loans, knowing that if they lost money, the government would bail them out. And they were right. The gambles did not pay off, our economy went into recession, and the taxpayers ended up footing the bill. Sound familiar?
Freddoso explores Obama's nasty housing past in Illinois' 13th Senate District.
Indeed, it does sound familiar — it sounds a lot like what Barack Obama did to Illinois taxpayers as a state senator in Springfield. Using his elected office and his clout, Obama helped Tony Rezko and other unscrupulous low-income housing developers obtain millions of dollars in state grants, tax credits, low-interest loans, and regulatory advantages.
Taxpayers had no serious chance of recouping these "investments" in Rezko and other developers. And many beneficiaries went one step farther, depriving the public of even the benefits they could have gotten. These developers took government help to build low-income housing, and then let their buildings deteriorate into uninhabitable slums.
To date, the most complete account of this sad story is Binyamin Appelbaum's piece in the Boston Globe. Not only does it demonstrate the monumental failure of the low-income-housing policy that Obama vocally championed as a state senator, it gives a detailed look at how some of Obama’s donors and friends — the beneficiaries of that policy — neglected their own housing developments at the expense of the inhabitants.
There is no indication that Obama approved (or even knew) of the massive and systemic neglect of these properties in his own state-senate district. But there is also no question that he was an enabler in these transactions. He cosponsored at least six bills to give special tax breaks, tax credits, building-and-maintenance subsidies, and zoning exemptions to the developers. In 1998, he wrote letters to state and city officials requesting $14 million for a project developed by Tony Rezko and another close Obama friend — the politician's old law-firm boss, Allison Davis.
Here's how the Globe described the Davis property:
Mice scamper through the halls. Battered mailboxes hang open. Sewage backs up into kitchen sinks. 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.
On June 27, 2003, Tony Rezko hosted a lavish fundraiser at his Wilmette mansion, pictured on the right. But at that time the Chicago Sun-Times reported last year that the state was working to foreclose on a Rezko property:
The cocktail party Rezko hosted in 2003 came at a critical time for Obama. He and Rezko timed it to help Obama show he had enough money to compete in the Democratic primary for U.S. Senate against millionaire Blair Hull and state Comptroller Dan Hynes.
"This was discussed a lot. They wanted to have a good showing," said a source familiar with the fund-raiser, speaking on condition of anonymity..
"Tony was one of the biggest fund-raisers."
At the time of the party, the state was in the process of foreclosing on a low-income apartment building Rezko's company rehabbed in Obama's state Senate district -- a rehab project on which Obama's law firm worked. Rezko had also abandoned many other low-income apartments, leaving numerous vacant units in need of major repairs.
Rezko paid for the party, but couldn't find cash to fix that building.
Audacity!
It was not the first time Rezko put cash-for-Obama ahead of the needs of his tenants. During the winter of 1997, tenants in a building co-owned by Rezko went without heat for five weeks.
Once again from the Chicago Sun-Times:
Rezko and Mahru couldn't find money to get the heat back on.
But their company, Rezmar Corp., did come up with $1,000 to give to the political campaign fund of Barack Obama, the newly elected state senator whose district included the unheated building.
Even more audacious!