Think Progress:

In yesterday’s news conference, President Bush sharply attacked Sen. Barack Obama’s (D-IL) argument that the president “should never fear to negotiate” with America’s enemies. Bush told reporters:

It will send a discouraging message to those who wonder whether America will continue to work for the freedom of prisoners. It will give great status to those who have suppressed human rights and human dignity. […]

Sitting down at the table, having your picture taken with a tyrant such as Raul Castro, for example, lends the status of the office and the status of our country to him. He gains a lot from it by saying, look at me, I’m now recognized by the President of the United States.

Perhaps Bush forgot all the times that he sat down and had his picture taken with leaders of questionable human rights credentials:

(HT: Ezra Klein, The Body Politik, and Cogitamus)

consortiumnews.com
By Dennis Bernstein
February 28, 2008

I remember my first piggy bank: a little pink piggy, made of plastic, with a little slot at the top. The slot was big enough, perhaps, to fit a half dollar, a great deal of money to me at the time.

“A penny earned is a penny saved,” my father told me, as we dropped the first few coins into the opening, and I heard them hit bottom and bounce. And I can’t tell you how excited I was when we broke it open, after a year or so, and I couldn’t fit another penny into the slot.

I tallied up my stash—close to five dollars, I recall— and decided what I would do with my small fortune. I bought a kite, and my imagination soared even higher than my beautiful Chinese box-kite as to what I would save up for next.

My pop gave me a powerful push in the right direction, when it came to savings: A penny saved really was a penny earned.

Unfortunately, this wasn’t the case for the 1,406 people who lost much of their life savings when Superior Bank of Chicago went belly up in 2001 with over $1 billion in insured and uninsured deposits. This collapse came amid harsh criticism of how Superior’s owners promoted sub-prime home mortgages. As part of a settlement, the owners paid $100 million and agreed to pay another $335 million over 15 years at no interest.

The uninsured depositors were dealt another blow recently when the U.S. Supreme Court let stand a lower court decision to put any recovered money toward the debt that the bank owners owe the federal government before the depositors get anything.

But this seven-year-old bank failure has relevance in another way today, since the chair of Superior’s board for five years was Penny Pritzker, a member of one of America’s richest families and the current Finance Chair for the presidential campaign of Barack Obama, the same candidate who has lashed out against predatory lending.

During a recent campaign stop in south Texas, Obama met with San Antonio-area residents who had been particularly hard hit by the sub-prime meltdown. He expressed dismay over how lobbyists for the sub-prime lending industry had spent more than $185 million in the last several years for their cause.

“To give you a sense of what that kind of lobbying gets you,” Obama said, a “CEO of the largest sub-prime lender was promised a $100-million severance package at a time when more than two million Americans were facing foreclosure, including nearly 14,000 right here in San Antonio.”

Though Superior Bank collapsed years before the current sub-prime turmoil that is rocking the world’s financial markets – and pushing those millions of homeowners toward foreclosure – some banking experts say the Pritzkers and Superior hold a special place in the history of the sub-prime fiasco.

“The [sub-prime] financial engineering that created the Wall Street meltdown was developed by the Pritzkers and Ernst and Young, working with Merrill Lynch to sell bonds securitized by sub-prime mortgages,” Timothy J. Anderson, a whistleblower on financial and bank fraud, told me in an interview.

“The sub-prime mortgages,” Anderson said, “were provided to Merrill Lynch, by a nation-wide Pritzker origination system, using Superior as the cash cow, with many millions in FDIC insured deposits. Superior’s owners were to sub-prime lending, what Michael Milken was to junk bonds.”

In other words, if you traced today’s sub-prime crisis back to its origins, you would come upon the role of the Pritzkers and Superior Bank of Chicago.

One Failure to the Next

Superior was founded at the tail end of 1988 in the wake of the failed Lyons Savings Bank. The Feds were trying to keep a lid on the magnitude of the S&L post-deregulation crisis and were selling failed or failing thrifts for a song, along with a lucrative package of special benefits.

Chicago’s billionaire Pritzker family and their partners bought Lyons Savings for a quite reasonable $42.5 million, but were also given $645 million in tax credits. The kicker was that the buyers only had to come up with $1 million in cash, and got access to the $645 million, and all the bank’s deposits insured by the Federal Savings and Loan Insurance Corporation (FSLIC).

The Pritzker family’s Superior Bank “started life with enormous tax benefits and a substantial amount of FSLIC-guaranteed assets under a FSLIC assistance agreement,” said financial consultant Bert Ely in a Oct. 16, 2001, statement before the U.S. Senate Committee on Banking, Housing and Urban Affairs.

Ely stated, “Superior’s trick, or business plan” under Penny Pritzker’s leadership was apparently “to concentrate on sub-prime lending, principally on home mortgages, but for a while in sub-prime auto lending, too.” In December 1992, the Pritzkers acquired Alliance Funding, a wholesale mortgage organization.

In a 2002 article in In These Times about Superior Bank’s collapse, business writer David Moberg reported that the bank’s operations were “tainted with the hallmarks of a mini-Enron scandal…And yet the bank’s owners, members of one of America’s wealthiest families, ultimately could end up profiting from the bank’s collapse, while many of Superior’s borrowers and depositors suffer financial losses.”

Moberg wrote that “the Superior story has a familiar ring. … Using a variety of shell companies and complex financial gimmicks, Superior’s managers and owners exaggerated the profits and financial soundness of the bank. While the company actually lost money throughout most of the ’90s, publicly it appeared to be growing remarkably fast and making unusually large profits. Under that cover, the floundering enterprise paid its owners huge dividends and provided them favorable loans and other financial deals deemed illegal by federal investigators.

“Superior’s outside auditor, which doubled as a financial consultant, engaged in dubious accounting practices that kept feckless regulators at bay. Many individuals—disproportionately low-income and minority borrowers with spotty credit records—had apparently been exploited through predatory-lending techniques, including exorbitant fees, inadequate disclosure and high interest rates.”

When it collapsed in 2001, Superior Bank represented the largest failure of a U.S.-insured depository institution for a decade.

“The failure of Superior Bank was directly attributable to the Bank’s Board of Directors and executives ignoring sound risk management principles,” said FDIC Inspector General Gaston Gianni Jr. in a Feb. 7, 2002, report.

Banking whistleblower Anderson noted that “Superior failed at a time of historically low interest rates, high employment, a strong economy, and a growing housing market. … There was no reason for it to fail unless you consider gross negligence, a flawed business plan, and a conspiracy to deceive the regulators who were clearly asleep and were negligent themselves in their duties of protecting the class of underinsured depositors.”

Pioneering Work

Anderson said the bank owners and board members used Superior for their pioneering work in sub-prime lending, developing the financial instruments that helped set the stage for the current sub-prime meltdown.

“The Pritzkers like to say they did sub-prime lending to help the disadvantaged get into the home equity business, [but] it would be more accurate to state they ran a very large nation-wide predatory lending operation,” Anderson said, citing criticism of Superior’s lending practices in a letter written to the Office of Thrift Supervision on July 3, 2002, by the National Community Reinvestment Coalition, an association of more than 600 community-based organizations that promote access to basic banking services.

As an owner and board chair of Superior, Penny Pritzker also was named in a RICO class action suit on behalf of the more than 1,400 depositors at Superior, who initially lost over $50 million of their life savings.

“This is a story of two Americas with two sets of laws, one for the rich and powerful and another for the rest of us,” said Clint Krislov, the depositors’ attorney, in a recent interview. “My clients will all be dead, before they get back their money, given the Supreme Court’s recent decision to uphold the lower court, which put the predatory owners on the front of the line, if any money is recovered.”

The Pritzkers arrayed a powerful and well-connected legal team including former President Bill Clinton’s impeachment lawyer Lanny Davis, two ex-comptrollers of the currency, and two former General Counsels to the FDIC, the American Banker Magazine reported.

Given the political sensitivity of the sub-prime mortgage crisis, Anderson said he believes Penny Pritzker should resign her post as Obama’s Finance Chair, the person who oversees the campaign’s fundraising.

Otherwise, Anderson said, Pritzker’s presence could undercut Obama’s credibility on the issue of predatory lending and create a possible conflict of interest if Obama is elected President and tries to crack down on sub-prime abuses.

Obama campaign spokesman Tommy Vietor had no comment about the controversy surrounding Pritzker, but added: “Barack Obama has already made it very clear that he’s going to crack down on fraudulent brokers and lenders.”

One might wonder why Hillary Clinton’s campaign hasn’t jumped on this issue. Maybe it’s because Penny’s little brother, J.B. Pritzker, is a mover and shaker in the Clinton campaign.

In May of 2007, Jay Robert, aka, (J.B.) Pritzker, threw his support behind Hillary Clinton, representing a coup for her campaign by wresting the billionaire out of Obama’s home town of Chicago, and better still, the brother of Obama’s Campaign Finance Chair.

J.B. Pritzker announced he would head a new grassroots organization called Citizens for Hillary Clinton. Pritzker told reporters at the time, the new organization would go into states “where we haven’t fully organized” and seek out campaign supporters as well as raise funds.

Apparently the Pritzkers will be sitting at the head table at the Inaugural Ball if either Democrat wins.

Dennis Bernstein is an award-winning investigative reporter and public radio producer. He is co-host and executive producer of the daily radio news magazine, Flashpoints, on Pacifica Radio, and a contributing editor to the Pacific News Service.

Puro Obama YouTube Channel

Video Update: Crooks and Liars

Update: I guess we shouldn’t be surprised. Ben Smith, at The Politico, flags that today CNN’s running a ‘online poll’ asking if Barack Obama has enough patriotism to be president

By Josh Marshall, Talking Points Memo:

Does Obama have a patriotism problem?

The AP’s Nedra Pickler asks disgraced Republican dirty-trickster Roger Stone for his opinion. Stone you’ll remember is the guy who got caught making threatening phone calls to New York Gov. Spitzer’s (D-NY) elderly father and last month set up an anti-Hillary group with the acronym C-U-N-T.

Surprisingly enough, Stone thinks the answer is yes.

Republican Congressman Embraces Obama Hoax Email

Overtime, and pretty quickly now, it’ll make sense to keep a list of stuff like this. On Friday night’s Bill Maher show, Rep. Jack Kingston (R-GA) claimed that Barack Obama refuses to say the pledge of allegiance to the American flag. This along with other bogus claims about Obama come from the hoax emails circulating on the internet.

If you see any local or national media outlets asking Kingston about this or if you get a word out of him, please let us know.

Of course, last night, the Associated Press signed on to the Obama hoax email train.

–Josh Marshall

Barack Obama appears to be riding high after winning his ninth and tenth primary contests in a row on Tuesday night in Wisconsin and Hawaii. And while Senator Hillary Clinton’s campaign may be struggling to knock the Illinois senator off stride, all indications show that Republican political strategists are gearing up for their own attacks on the candidate if he sustains his momentum.In a blog post at the National Review Online, reporter Jim Geraghty asked the question, “Once you take away Barack Obama’s likeability… what’s left?”

Geraghty argued in the Tuesday post that Obama is highly vulnerable to a set of criticisms that can only be made by Republicans, and that once they are deployed, they will reverberate with voters around the country and end the idea that Obama is untouchable.

John McCain can point out that Obama wanted to make it a felony if your gun is stolen from your residence and used in a crime, if the government determines you did not “securely store” the weapon. Hillary Clinton can’t.John McCain can point out how Obama opposes a ban on partial birth abortion ban, and who voted against a bill that would require medical care for aborted fetuses who survive. Hillary Clinton can’t.

John McCain can point out how Obama was the only state senator to oppose a law that prohibited early prison release for sex offenders. For some reason, Hillary Clinton hasn’t.

John McCain can point out that Barack Obama has been rated the most liberal lawmaker in the U.S. Senate by National Journal. Hillary Clinton can’t.

As Geraghty goes on to explain, “In other words, the only information most Americans have encountered regarding Obama so far has been gushing press coverage, and ineffective attacks on him from Hillary from the left. Conservatives have not, by and large, focused their ire on Obama… mostly because he ain’t her.”

Senator McCain himself seemed ready to contrast his candidacy with that of Senator Obama in his victory speech on Tuesday night after winning the Wisconsin primary.

“I’m not the youngest candidate. But I am the most experienced,” he said. “I know what our military can do, what it can do better, and what it should not do. I know how Congress works, and how to make it work for the country and not just the re-election of its members. I know how the world works.”

Republican activists also played up the experience theme.

“In November, American voters won’t have to decide between a candidate with no experience and a candidate who is untrustworthy,” said Republican National Committee Chairman Mike Duncan in a statement after Obama’s victory. “I am confident Americans will choose the most qualified candidate to take on the big issues our nation faces, and that candidate is not Barack Obama.”

McCain’s wife Cindy also took a shot at Obama’s wife Michelle on Tuesday, highlighting her remark that “for the first time in my adult lifetime I am really proud of my country.”

“I am proud of my country,” McCain’s wife said Tuesday in Wisconsin. “I don’t know about you? If yo

Jason Linkins
The Huffington Post

Fresh accusations of plagiarism are being hurled at Barack Obama for his use of language on the stump that directly mirrors speeches given by Massachusetts Governor Deval Patrick. But there is no fresh news here: in fact, this rhetorical connection between the two pols was noted by the Boston Globe way back in April of 2007.

In an article titled, “Patrick, Obama campaigns share language of ‘hope,’” Globe reporter Scott Helman noted that the “just words” theme of Deval Patrick’s speech were born out of accusations that mirror the ones Obama is facing now, and that Obama was present on one occasion when Patrick deployed the language:

Of all the things Deval Patrick’s Republican opponent threw at him in last year’s governor’s race, one charge that stuck in his craw was that his speeches were more fluff than substance — that they were, in Patrick’s telling, “just words.” So he devised an artful response.” ‘We hold these truths to be self-evident that all men are created equal’ — just words,” Patrick said at a rally in Roxbury right before Election Day. ” ‘We have nothing to fear but fear itself’ — just words. . . . ‘I have a dream’ — just words. They’re all just words.”

The crowd erupted as it got Patrick’s point about the power of language. But perhaps no one at the rally understood the point better than Barack Obama, who had joined him on stage that night.

Similarly, the article from April 2007 specifically mentioned that the Obama campaign had every intention of studying the success of his friend, Patrick, as a model for his own Presidential run:

In the midst of his improbable run for office, Obama and his advisers have evidently studied Patrick’s up-from-nowhere victory in Massachusetts and are borrowing themes, messages, and even specific lines for the presidential campaign.

Both men were said by the Globe to be — at the time — “learning from and feeding off each other.” The root of their shared rhetoric was identified as David Axelrod, who advised both campaigns. And while Patrick did notably back away from using Obama’s “Yes we can” refrain — Patrick campaign advisor Dan Payne said at the time, “We definitely didn’t want to copy him, Deval takes pride in his words and he wants to use them uniquely” — there’s no indication that either man objected to sharing rhetorical flourishes.

Similarly, there wasn’t any indication back in April of last year that this matter was any cause for concern or complaint. State Democratic Party chair Phillip W. Johnston spoke of the two men with admiration: “We all said that we could have closed our eyes when Obama spoke [and] it could have been Deval. To us it was a similar kind of message. It’s a message that transcends partisan politics.”

By Katrina vanden Heuvel, The Nation:

In 2006, Sherrod Brown ran on an anti-war populist economic message and won in towns across Ohio long written-off by Democrats. On March 4, the Democratic primary will be held in the state, with Obama possibly looking to continue a streak of victories, while Clinton faces as close to a must-win situation as we are likely to see in the fight for the nomination.

While Senator Brown has said he won’t endorse either candidate before the Ohio primary, he’s in close contact with both candidates, and in an interview with me he spoke candidly about trade, globalization, and lessons on how to win in his state. To paraphrase, it’s about economic populism, stupid. And as Obama battles to make inroads with the white and Latino working-class, and Clinton distances herself from the trade policies of her husband’s administration, Ohio is there for the taking.

Here then is the transcript of my conversation with Senator Brown:

Q: How are you approaching any endorsement decision?

I will not endorse before the Ohio primary. I’m weighing what my state does, that’s certainly part of it. Also, my conversations with both Barack and Hillary, and with Governor Sebelius calling for Barack, and with Bill Clinton calling for Hillary, and Dick Durbin — all the people who have called for them, in addition to talking directly with the candidates … [we] talk about trade, talk about a populist, progressive message in Ohio, talk about privatization and anti-privatization, and all the things they need to do around tax and trade policy.

Both of them are obviously significantly better than Bush Republicans, McCain. They’re close. I’ve talked to Barack a lot about his Patriot Corporation Act, which is not trade per se, but it’s certainly part of the economic package around globalization. The Patriot Corporation Act has not gotten the attention that I would hope it would. But, basically it says that if you play by the rules, if you pay decent wages, health benefits, pension; do your production here; don’t resist unionization on neutral card check, then you will be designated a “Patriot Corporation” and you will get tax advantages and some [preference] on government contracts. Jan Schakowsky first came to me … I co-sponsored and worked on it with her in 2005 or 2006. And Barack has been a sponsor of it in the Senate. Hillary is not on it as of now, but those are the kinds of things I want to see them talk about and do and I am hopeful — and pretty much expect — that they will talk about those issues in Ohio.

Q: Have you had a chance to talk to Sen. Clinton about the Patriot Corporation Act?

Yes, I did some time, back — early, like October or November. I’ve talked to her since about other things, more specifically, trade. And Barack I’ve talked to within the last week both on trade and on the Patriot Corporation Act. It does two things, the Patriot Corporation Act and better trade policy: it helps win Ohio and helps them govern in the right way. I think you can really take the country in a very different direction building a progressive message around that kind of economic issue — the Patriot Corporation Act and trade. We won 32 or 33 more counties than John Kerry did mostly in small towns in rural Ohio where they were very responsive to a populist progressive message. One town in particular — this is something that just happened — there’s a company called American Standard, they make toilets, plumbing fixtures, you’ll see them in near any public restroom anywhere. They’re in Tiffin, Ohio, town of 20,000. They’ve just announced back around 3 months ago, the closing of the plant. It was bought by some investors, they’re moving offshore, they’re honoring the union contract as far as they have to, which is those who already have their 30 years. If you have less than 30 you’re pretty screwed — they give you something, but you can’t get to the 30 years because they close the plant. And the company that came in and bought it was Bain Capital, Mitt Romney’s firm … These investors come in, take millions of dollars out of the company, and you know, it’s pension and healthcare. And those are going on all over the country. And this is a town of 20,000. I carried that county, Kerry didn’t. They had already laid off some people … It’s those kinds of situations that cause small town Ohio to vote for somebody like me regardless of the social issues.

Whenever Hillary says the right thing about trade, the Washington Post just slams her. It’s unbelievable. I met with the Post editorial board back in about November or December, and I said, kind of joking with them, “Do you have a full-time person, every time Hillary says anything that you don’t like on trade, you like automatically write an editorial within 24 hours?” They kind of laughed and said, “Yeah, we have a full-time person on it.” But the newspapers — I got one newspaper endorsement in the state of the big nine papers. It was the only paper that’s been a bit more even-handed on trade … They’re gonna get slapped around by the newspapers for this. Particularly Hillary … Hillary’s clearly moved way away from the old Clinton [administration] position, but the newspapers want to slap her every time she speaks out about that. Because they think it’s all for political reasons. I really don’t. I think that both of them genuinely see the problems of globalization. I think they understand that, I don’t think their solutions are quite strong enough yet — either of them. But I think they’re on the way and they’re getting close, and I think we’ll see more of that kind of growth as they focus on these kinds of issues in the Midwest now.
Continue Reading »

John Nichols, The Nation

Barack Obama won the Maine caucuses by a wide margin Sunday night, securing 59 percent of the vote to just 40 percent for Hillary Clinton.

That’s 15 more delegates for Obama, nine more for Clinton.

And it caps a weekend that saw Obama win everywhere people had a chance to vote for him — from the Virgin Islands, where he got 89.9 percent of the vote, to Louisiana (57 percent of the vote; 33 delegates to 22 for Clinton) to Nebraska (68 percent; 16 delegates to 8 for Clinton) to Washington (68 percent; 35 delegates to 15 for Clinton).

But Maine was particularly sweet. It neighbors New Hampshire, which denied Obama an expected win in last month’s primary, and Massachusetts. which backed Clinton on Super Tuesday.

Both Obama and Clinton campaigned in Maine — bringing a rare level of attention to a state that usually caucuses without much attention. The Clinton camp also brought in former President Bill and former First Daughter Chelsea, and it had the backing of Maine Governor John Baldacci.

But Obama swept just about everywhere.

After this weekend of wins, Obama backers will be excused for renewing the old saying, “As Maine goes, so goes the nation.” They’ve got to feel that the momentum in on their side.

And if the Illinois senator wins Tuesday’s “Potomac primary” voting in Maryland, Virginia and the District of Columbia, the Obama camp won’t just be feeling it has momentum. The surge will have been confirmed.

On the day before the Dr. Martin Luther King, Jr. holiday, Senator Barack Obama delivers a speech to the congregation of Ebenezer Baptist Church in Atlanta, Georgia.

Tensions Flare Between Obama and Clinton

News Sources Agree: Clinton Has Been Misrepresenting Obama’s Comments on Republicans