Obama’s First Test

New York Post – By Nicholas Wapshott 

February 24, 2008The corruption trial of Antoin “Tony” Rezko, due to start in federal court in Chicago tomorrow, comes at a bad time for Barack Obama. The senator from Illinois is surging ahead of his rival Hillary Clinton in the Democratic race by presenting himself as Mr. Clean, untainted by the corrupt ways of Washington politics.

But Obama’s ability to make the right call on important issues, and his claim to be untainted by politics as usual, is seriously called into doubt by his alliance with the property developer and fast food franchiser Rezko, a close personal friend and one of his most generous donors.

While there is no suggestion that Obama has done anything illegal, the Rezko trial will focus attention upon the propriety of a deal between the senator and Rezko that substantially raised the value of the senator’s sumptuous home on Chicago’s South Side. What Rezko expected from Obama in return remains unclear.

In June 2005, Obama bought a 98-year-old Kenwood mansion from a University of Chicago doctor for $1.65 million, using a $1.69 million advance he received from publishers Crown for his book, “The Audacity of Hope.” The same day Rezko’s wife Rita paid the doctor $625,000 for the empty lot adjoining Obama’s property.

Even though at the time Rezko was under federal investigation for influence-peddling in Illinois Governor Blagojevich’s administration, Obama did business with him, buying for $104,500 a 10-foot wide strip of Rita Rezko’s lot, ostensibly to provide space for a fence. The deal left Mrs. Rezko’s lot too small to build upon, thereby lifting the value of Obama’s home.

Obama denies wrongdoing. “I misgauged the appearance presented by my purchase of the additional land from Mr. Rezko,” Obama told the Chicago Sun-Times. “It was a mistake to have been engaged with him at all in this or any other personal business dealing that would allow him, or anyone else, to believe that he had done me a favor.”

Obama now calls “boneheaded” his decision to continue to consort with Rezko even after a grand jury investigation into his dealings had begun and he has given about $150,000 of Rezko’s campaign contributions to charity.

But that was not the end of the affair. The senator’s claim to have been completely open about his relationship with Rezko was called into doubt on Monday when the senator belatedly admitted that, before he bought his home, he and Rezko visited the property together.

Rezko is a presidential candidate’s nightmare buddy. He stands accused of demanding fake finder’s fees for payments made to Illinois teachers’ and health workers’ state pension funds. And he is accused of defrauding GE Capital out of $10 million in loans for his fast-food franchises.

According to court documents, Rezko is also accused of prompting “at least one other individual” to give money to Obama’s senatorial campaign, then reimbursing him, in violation of federal election law.

Prosecutors have submitted to the court a 26-page list of those Rezko wanted appointed to posts in Illinois Governor Blagojevich’s administration. The list contains those whom Obama recommended for state jobs. On Thursday it was reported that among those Rezko proposed for a job was the real estate agent who conducted the sale of Sen. Obama’s home.

The links between Obama and Rezko that will be on show in the forthcoming trial may expose a chink in Obama’s shining armor. Hard evidence of his at best naivety in the face of political corruption may not come quickly enough to help Hillary Clinton, who must win in Texas and Ohio on March 4 if she is to escape defeat. Most of the coming week in court will be taken up with jury selection.

In one of the early debates Clinton berated Obama for his links to Rezko, whom she called a “slum landlord.” The remark was dismissed by the Obama camp and Clinton has not returned to the attack. She will be sorely tempted to revive the issue this week.

If the Rezko trial comes too late to alert Democratic voters to the murkier side of Obama’s time in Chicago politics, John McCain can be sure to exploit the court-attested fact that the Illinois Senator is not as free from the influence of sleaze as he likes to suggest.

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2 comments

  1. “The deal left Mrs. Rezko’s lot too small to build upon, thereby lifting the value of Obama’s home.”

    Poor reporting by Mr. Wapshot as this statement isn’t true.

    The lot is still buildable, and in fact it has since been sold at a profit to another developer who planned to put townhouses on it.

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