The cable news and other media outlets have latched on to the Obama-James Johnson story. Actually, there was plenty to ponder about James Johnson before his discounted loan deal came to light. He was an adept insider who, as Fannie Mae CEO, hired Washington lobbyists — those bad people who supposedly work only for Republicans — to figure out a way to avoid Congressional oversight and paying taxes on Fannie Mae profits. At the time, the move outraged Democrats. Somehow he managed to keep almost $2M in bonus money despite improper statements of Fannie Mae’s profits as described here:
An Office of Federal Housing Enterprise Oversight report in September accused the company of improperly deferring $200 million of estimated expenses in 1998, which allowed management to receive full annual bonuses. Had the expenses been recorded that year, no bonuses would have been paid, the report said. Fannie Mae reported paying bonuses in 1998 to Johnson, who received $1.932 million; Raines, who then was chairman-designate, $1.11 million; Chief Operating Officer Lawrence M. Small, $1.108 million; Vice Chairman Jamie S. Gorelick, a former deputy attorney general, $779,625; Chief Financial Officer J. Timothy Howard, $493,750; and Robert J. Levin, who was executive vice president for housing and community development, $493,750.
Not surprisingly the RNC is going to town on this, releasing this 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.
It is a bit of a message problem for Obama on a day he’s at the Bush economic plans with statements like this:
And for all of George Bush’s professed faith in free markets, the markets have hardly been free – not when the gates of Washington are thrown open to high-priced lobbyists who rig the rules of the road and riddle our tax code with special interest favors and corporate loopholes. As a result of such special-interest driven policies and lax regulation, we haven’t seen prosperity trickling down to Main Street. Instead, a housing crisis that could leave up to two million homeowners facing foreclosure has shaken confidence in the entire economy.
Nothing gets the press going like blatant hypocrisy.
