The watchdog group Judicial Watch filed two ethics complaints over the rate break given to Barack Obama by the lender for his home mortgage, Northern Trust. The complaints to the FEC and the Senate Ethics Committee charge that Obama accepted an inappropriate gift worth $125,000 over the life of the mortgage with Northern Trust’s discounted rate:
Judicial Watch, a conservative legal watchdog group, filed the report after The Washington Post reported that Obama received a discount on a mortgage for a Chicago home valued at $1.65 million. The complaints said the Illinois senator received a loan at the interest rate of 5.625 percent, which Judicial Watch says is lower than the standard rate of between 5.93 and 6 percent indicated by surveys.
The complaint asks the Senate Ethics Committee to investigate whether the favorable rates constitute a prohibited “gift” under Senate rules.
The FEC action focuses on the donations made by Northern Trust as an indicator of a political favor. Employees gave Obama’s campaign $71,000, which JW believes to be an indicator of the favorable treatment Obama received for the loan. Obama didn’t have to pay points or fees to get the lower rate, either, which is very unusual for the “super-jumbo” loan he received.
All of that and $5 will buy a cup of latte at Starbucks, too. The problem here is that most of this can be explained at least enough to get past the complaints — especially with the Senate Ethics Committee. That group probably won’t rouse itself to take action against Chris Dodd and Kent Conrad, two Senators who obviously got preferential treatment on loans and rates through the intervention of Countrywide’s CEO, Angelo Mozilo. Dodd and Conrad deserve removal, but if they even get so much as a censure, I’ll eat my hat.
The FEC complaint seems even weaker. Northern Trust employees donated a lot of money to Obama, but he’s a Chicago politician, too, and lots of companies have employees who donate lots of money to politicians of both parties. Unless JW has evidence that Northern Trust used straw donors to launder donations to Obama, it doesn’t look like a problem for Obama.
The deal bothers me more than it does Jazz Shaw, who sees it as a lower-margin leader for more potential business from a wealthy client. The mortgage and its no-fees, no-points arrangement clearly looks like preferential treatment for political rather than commercial purposes, but it’s ambiguous enough to keep Obama and Northern Trust out of hot water. I doubt that it will register among voters in the long run — and Obama can thank his colleagues Dodd and Conrad for their inadvertent assistance in that regard.