ShoreBank: Is There a Rezko Connection? July 22, 2010
Posted by seeineye in : Politics , 4commentsby Joel B. Pollak
For months, we have been told that ShoreBank deserves a bailout because it serves poor communities. We have been assured by ShoreBank’s patrons, such as Rep. Jan Schakowsky (D-IL), that allowing the federal government to take over the bank will put borrowers in those communities at risk.
Now, as the truth has begun to emerge, it is becoming clear that ShoreBank’s troubles did not begin in poor communities at all.
Robin Sidel of the Wall Street Journal reports that ShoreBank’s financial problems may partly stem from loans made to condominium developers and builders in parts of town beyond its traditional focus on the city’s South Side.
If ShoreBank deserves help because it is the “iconic community development bank,” as Schakowsky recently claimed, what was it doing lending money to condo kings, and why should taxpayers bail it out?
If the ShoreBank is taken over, Schakowsky claims, “the losers will be these low-income communities and the businesses and the homeowners that they serve.”
That was never true.
The businesses and homeowners will be protected, as they are in every federal takeover. Rather, those with the most to lose from ShoreBank’s failure will be its board, its political patrons, and the developers who hoped to profit from its “iconic” status.
This is not the first time that property developers have played a key role in a Chicago political scandal.
Property developer Tony Rezko, a fundraiser for both Barack Obama and former governor Rod Blagojevich, is currently in federal prison on corruption-related charges. During his career, he was involved in many condominium projects in the city, including one that Obama helped him build by urging state funding for the project.
The plot thickens. At the ongoing Blagojevich trial, Ali Ata, the former head of the Illinois Finance Authority (IFA), testified last month that Rezko arranged for him to be appointed to the IFA by helping him pay off the governor.
The current chair of the IFA, Bill Brandt, has been one of the most vociferous proponents of a ShoreBank bailout, and may even have suggested a state-level bailout to ShoreBank, rather than the other way around.
There is another Rezko connection to ShoreBank: Howard Stanback, who serves on one of ShoreBank’s boards, once worked for Rezko at New Kenwood LLC–the same development company that Obama had assisted.
(Rezko’s partner at New Kenwood was Obama’s former boss, Allison S. Davis; Stanback also chaired the Woods Fund, where Obama served along with Bill Ayers of the Weather Underground.)
Until now, the role played by property developers in ShoreBank’s demise has been hidden from all but a few insiders and key officials at the Federal Reserve.
A few days ago, Tim Geithner responded to a request by Schakowsky and other Chicago Democrats by giving ShoreBank an 11-week extension. Before, it needed to raise enough capital to avoid closure by May 21; now, it has until August 6. (How many homeowners get that kind of break?)
Republicans in Congress have pushed for an investigation into the White House’s role in trying to secure a bailout for ShoreBank. Yet we also need a public forensic audit of the bank.
Is there a Rezko connection? Are there developers with ties to the Chicago machine who would be protected by a bailout? What are the connections, if any, to Obama, Schakowsky, and other Chicago politicians?
We need to know–now. At the very least, we can already dismiss Schakowsky’s false excuse that the bailout is for the poor. It is nothing more than Chicago-style corruption on a national scale.
Democrats Attack Small Business Owner for Speaking Out Against Obama’s Policies July 22, 2010
Posted by seeineye in : Politics , add a commentby Sean Mahoney
The liberal Democrats in New Hampshire have sunk to a new low. They are smearing a private citizen in the press because he opposes the Obama-Pelosi agenda. I’ve never really seen anything like it, but I fear it is emblematic of what will happen to other small business owners who are suffering from Obama’s policies.
Last Thursday I held a press conference in my race for Congress in New Hampshire’s First Congressional District with a gentleman named Alan Silberberg, whose auto dealership was shut down arbitrarily by Chrysler, Obama’s “car czar” and his “Auto Task Force.” The purpose of the press conference was to demonstrate how Barack Obama, Nancy Pelosi and my Congresswoman Carol Shea-Porter’s policies are destroying our economy.
It’s important to know that Alan wasn’t shut down because his business was failing. He was shut down because the government’s policies put his business on the chopping block without transparency and without accountability. To let people know how he felt, Alan painted a sign on his storefront that reads, “This business now closed because of Obama’s economics.”
Folks don’t need to listen to me or to Alan. They can listen to Neil Barofsky the special inspector general for TARP:
The Obama administration’s push to accelerate General Motors Co. and Chrysler Group LLC dealership closings, aimed at helping the companies compete, may not have been necessary and added to unemployment, a U.S. watchdog said.
The Treasury Department should have considered whether speeding up the closings was worth the potential loss of tens of thousands of jobs, according to a report released yesterday by Neil Barofsky, special inspector general for the Troubled Asset Relief Program. The U.S. had rejected reorganization plans from the carmakers in March 2009, in part citing a “slow pace” for GM to scale back its dealer network.
“Such dramatic and accelerated dealership closings may not have been necessary and underscores the need for Treasury to tread very carefully when considering such decisions in the future,” Barofsky concluded.
The report may prompt congressional criticism of the administration’s handling of the automaker bailouts. Lawmakers have already complained about the job losses in their districts from dealership closings and the process by which retailers were selected for shutdowns.
Of course, the Democrats attacked me in the press for having the guts to stand up to Obama’s policies. I’m a candidate for Congress. I expected it and I can handle it.
But I didn’t expect them to attack Alan.
He’s not a candidate for any office. He’s not even involved in politics. He’s a small business owner who got railroaded by the Democrats’ economic train wreck. Yet that’s what the New Hampshire Democratic Party did – they distributed a press release attacking Alan, attempting to damage his personal credibility.
Think about it: First their economic policies robbed this man of his livelihood and then when he objected to their policies they personally attacked him.
This entire episode is symptomatic of Washington’s contempt for the very small business owners and working families who power our economy. They would rather have the government run the every industry. That’s why they are driving up the debt while spending trillions on bailouts, the failed stimulus and Obama’s government run health care.
Worse still, my concern is that such bullying tactics will prevent others from speaking out on their own behalf in the future. So I’m here to provide some comfort to those small business owners and working families who are suffering under this administration’s policies. There is a whole group of us conservatives who stand behind you. Many of us are running for office this year. And if we win – when we win – we are serious about repairing the economic damage Obama and his liberal allies have brought to our economy.
We are going to fight to repeal ObamaCare. We’re going to stop the bailouts. We’re going to cut government spending to reduce the debt and budget deficits. We aren’t like the Republicans you are used to; those who run as heirs to President Reagan but govern as Jimmy Carter. We are conservative and we aim to make a real difference in Washington.
