So the GOP Wants to Talk About Shady Friends?

Originally posted: June 13, 2008

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Last week, Tony Rezko, the ex-Obama friend and fundraiser, was convicted of 16 counts of fraud, money laundering and bribery. Minutes after the jury rendered its verdict, the Republican National Committee was e-mailing the press linking the two over a 20-year period.

No question about it, they were linked. Rezko raised plenty of money for Obama’s campaigns over many years, $159,000 of which Obama recently donated to charity. When the Obamas bought a house in the Hyde Park section of Chicago, Rezko’s wife bought the lot next door and sold off an adjoining portion, enabling the family to expand its yard. This was a deal that Barack Obama correctly called “boneheaded.” During the primaries, Hillary Clinton made much of the Rezko connections, calling him a Chicago slumlord.

But if the Republicans want to continue to exploit this issue, they should remind themselves that Obama is not the only politician whose wealthy friends got him into trouble. If the people with the communications department at the RNC doesn’t recall the Keating Five scandal, they need a history lesson.

Charles Keating was a savings-and-loan kingpin from Phoenix who befriended John McCain during his earliest days in politics. While McCain was a congressman, he regularly flew on Keating’s private jet, and for three years in the mid-1980s their families vacationed together at Keating’s opulent Bahamas resort. When McCain ran for the Senate in 1986, Keating, his family and friends raised $112,600 for the campaign.

Then, in 1987, just a few months after McCain was elected, his pal Charles Keating came knocking at the door. Keating’s Lincoln Savings and Loan Association was in trouble, facing a probable criminal referral from the Federal Home Loan Bank Board to the Justice Department. Keating requested — actually demanded — that McCain join four other senators (all Democrats) to pressure banking regulators to ease up on Lincoln. Unwisely, Sen. McCain attended two meetings on Keating’s behalf. When Lincoln finally tanked, it cost taxpayers $3.4 billion along with the life savings of many of McCain’s elderly Arizona constituents.

Keating faced 73 counts of wire and bankruptcy fraud, and his friend John McCain faced the ordeal of a highly public Senate ethics investigation. For a man whose honor is the core of his identity, McCain was deeply humiliated. The Keating Five scandal became national shorthand for the kind of political influence money can buy. Robert Timberg, McCain’s biographer, says that for three years his Senate office was paralyzed by paranoia and an ever-deepening despondence. McCain said of the eight weeks of televised Senate Ethics Committee Hearings: “This is the worst thing, the absolute worst thing that ever happened to me.” Reminded of his years of captivity and torture during the Vietnam War, McCain said, “No, this is worse.”

McCain told the committee that he had met with bank regulators only because the Lincoln S&L was a major employer in Phoenix, and argued that it was not he but the other senators who applied pressure on behalf of Keating. That was probably true. The Ethics Committee censured Sen. Alan Cranston of California, but McCain received only a slap on the wrist for “questionable conduct.”

John McCain and Barack Obama are guilty of the same thing: carelessly choosing their friends. For both, the lesson surely has been learned. It would have been all right with me to get through this entire campaign without mentioning the Keating Five. It certainly would be all right with John McCain. But the parallels between Keating and Rezko are so striking that someone at the RNC should have noticed and realized that Obama’s sins were of a lower order than those of the Republican nominee for president. Obama never attempted to use his office to aid Rezko.

John McCain once said, “The Keating Five scandal will probably be on my tombstone.” Thanks to a little help from his friends at the Republican National Committee, he’s probably right.

Ken Bode is Pulliam Professor of Journalism at DePauw University

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