Wes Vernon
November 13, 2008
Obama--serious about financial "reform"? Serious about "security"?
By Wes Vernon

He's more than two months away from being sworn in as the 44th president of the United States, and already Barack Obama has surrounded himself with people with serious baggage, and who raise questions about the new president's intentions on the domestic and foreign policy fronts.

More on Emanuel

This column has already dealt with the slash-and-burn proclivities of ex-ballet dancer and onetime Clinton advisor Rahm Emanuel. (See "The outlook: Of thugs and heroes" 11/10/08.) That raises questions about the "coming together," "unity," and "bipartisanship" blather coming out of the president-elect's camp.

Yet another page in Emanuel's recent past raises questions as to whether in picking him as his White House chief of staff Mr. Obama is serious about doing away with the under-the-table cronyism that played a significant part in the financial collapse that helped the rookie Illinois senator ascend to the most powerful office in the world.

Freddie Mac

When Emanuel stepped down as a senior advisor to President Clinton near the end of the latter's final term, the president expressed his thanks by appointing his aide to the board of the quasi-governmental Freddie Mac. This company together with its sister Fannie Mae played a major role in the financial meltdown, largely because of the bad loans to people they knew could not pay them back.

Reporter Lynn Sweet of the Chicago Sun-Times wrote about this in 2002 just as Emanuel was gearing up for his successful run at a congressional seat.

He won the office anyway, but of course, that was long before Freddie's shenanigans came to light. It didn't hinder his re-election to Congress just last week after the cat was out of the bag, but remember this is Chicago. They are immune to political shock there.

Emanuel quickly achieved the fourth highest office in the House leadership, but remember this is the Pelosi House. His past as one of Clinton's tough guys probably burnished his resume.

The record at Freddie

According to the AP, Freddie Mac illegally used corporate resources between 2000 and 2003 for 85 fundraisers, collecting about $1.7 million for federal office-seekers. And further, "Much of the fundraising benefited members of the House Financial Services Committee."

In the 2002 race, Freddie Mac was Emanuel's third largest contributor at $25,000. In fact, in the years since his 2002 House campaign, Emanuel scooped up $51,750 in campaign cash from Freddie and Fannie, according to the Center for Responsive Politics website, OpenSecrets.org.

Conflict of interest?

In a 2003 column, reporter Sweet pointed out that "Rep. Rahm Emanuel (D-Ill.), a former Freddie Mac board member, sits on the very House subcommittee that has oversight of the federal government-sponsored enterprise at the same time he has outstanding options for 2,500 shares of the company."

Emanuel said there's no conflict of interest because his stake in Freddie Mac was put in a blind trust, and added that he would recuse himself from any votes pertaining to Freddie Mac. That answer prompted Sweet to comment that "Emanuel's trust is supposed to be blind, not stupid."

However, Jeff Poor of the Business and Media Institute notes that while Emanuel was on the Freddie Mac payroll in an overseer capacity, that same Freddie Mac was "cooking the books." In fact, Forbes magazine notes that the government-backed entity was understating its earnings by $5 billion.

Freddie Mac had to cough up $3.8 million in fines to the Federal Election Commission for allegations of illegal political contributions between 2000 and 2003.

Show us the money

Sweet of the Sun-Times adds that in 2001, Emanuel was paid $231,655 in director's fees, and $31,060 in 2000. The then-Chicago congressman explained that the pay was for attending quarterly board meetings and participating in committee meetings either in person or by telephone.

Serious on security?

Recall that last spring, this column ("Obama's Communist connections" 5/26/08) highlighted one Robert Malley, Program Director for George Soros's International Crisis Group. He had held talks with the Middle East terrorist group Hamas. Mr. Malley was there on Obama's behalf. Thus, the candidate found himself in political hot water when a Hamas official told Malley, "We like Mr. Obama. We hope he will win the election."

Horrified, the Obama campaign ditched Mr. Malley a campaign spokesman saying, Mr. Malley "has no formal role in the campaign, and he will not play any role in the future."

Well, here we are "in the future," and Robert Malley has re-emerged as part of President-elect Obama's team. And do you think the mainstream media are giving much attention to this? That gap has been filled by RenewAmerica columnist Warner Todd Huston (see "Obama sends man linked with terror group and George Soros to deal with Egypt/Syria" 11/11/08).

It's safe, you can come out now

Huston cites a report in Israel that Malley identified (now that last week's U.S. votes are counted) as "a top Middle East advisor" to the president-elect, has been sent to engage in talks with Egypt and Syria "on the next administration's first diplomatic mission."

The Israeli report lays it on the line, charging that Obama "lied" about getting rid of Malley earlier this year.

Some background

At the time of the May brouhaha, intelligence expert Herbert Romerstein told me of Malley's family background. His father Simon Malley was an important figure in the Egyptian Communist Party, and was kicked out of Egypt and later out of France because of his ties.

Romerstein added that the younger Malley's policies are "antithetical to the best interests of the United States, and are a plus for Hamas, Hezbollah and other enemies of the United States." Robert Malley has been an apologist for Yasser Arafat, rejecting the opinion that all the blame for the failure of a 2000 Camp David summit rested with the late PLO terrorist.

Why Obama would risk antagonizing Israel just weeks before he takes office is troubling.

A pattern

The above two examples may indicate that the real Barack Obama is coming out in the open:

1 While vowing to tackle the economic basket case that has hit this country, the president-elect appoints as his chief-of-staff a man who has ties to the Freddie Mac political money machine a major cause of the financial mess. This is no small matter. Knowing Rahm Emanuel's "take charge" style, you can bet that he will be the first person Obama sees in the Oval office in the morning and the last to talk to him at the end of the work day.

2 Now that he safely locked up the Jewish vote in last week's election, the incoming president apparently feels at ease in causing mistrust of the U.S. on the part of our Israeli allies, and more to the point sends to the Middle East an envoy who got the Obama campaign in trouble because of the appearance of being soft on terrorism.

"Give him a chance," his supporters plead. Give him a chance to do what?

© Wes Vernon

 

The views expressed by RenewAmerica columnists are their own and do not necessarily reflect the position of RenewAmerica or its affiliates.
(See RenewAmerica's publishing standards.)