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2008-12-10

Illinois Governor Arrested on Corruption Charges Including Scheme to Sell Obama’s Senate Seat

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David Moberg, Senior Editor of In These Times magazine.

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Illinois Governor Rod Blagojevich was arrested yesterday on staggering corruption charges, including allegations that he tried to sell the Senate seat vacated by fellow Democrat, President-elect Barack Obama. In recorded conversations with his advisers, Governor Blagojevich laid bare a "pay to play" culture that, according to prosecutors, began shortly after he took office in 2002 and continued until yesterday morning, when FBI agents arrested him and his chief of staff, John Harris. Blagoevich was also accused of trying to extort the Chicago Tribune into firing editorial writers who were critical of him. [includes rush transcript]

Transcript

This is a rush transcript. Copy may not be in its final form.

SHARIF ABDEL KOUDDOUS: Illinois Governor Rod Blagojevich was arrested yesterday on staggering corruption charges, including allegations that he tried to sell the Senate seat vacated by fellow Democrat, President-elect Barack Obama. In recorded conversations with his advisers, Governor Blagojevich laid bare a “pay to play” culture that, according to prosecutors, began shortly after he took office in 2002 and continued until yesterday morning, when FBI agents arrested him and his chief of staff, John Harris.

Federal prosecutors revealed the charges in a seventy-six-page complaint unsealed on Tuesday. Beyond deliberations about selling Obama’s Senate seat, Blagojevich is accused of trying to extort the Chicago Tribune

, one of the country’s leading newspapers, into firing editorial writers who were critical of him.

Blagojevich and Harris appeared in a Chicago federal courthouse yesterday afternoon to answer charges of conspiracy to commit mail and wire fraud and solicitation of bribery. The charges carry maximum combined penalties of thirty years in prison. Blagojevich was released after paying a $4,500 bond and agreeing to turn over his passport and a card entitling him to own a firearm. A hearing in federal court will be held in January to determine whether there is probable cause to go forward with the charges.

Patrick Fitzgerald, the United States attorney for the Northern District of Illinois, detailed the charges in a startling press conference yesterday afternoon.

    PATRICK FITZGERALD: It’s a very sad day for Illinois government. Governor Blagojevich has taken us to a truly new low. Governor Blagojevich has been arrested in the middle of what we can only describe as a political corruption crime spree. We acted to stop that crime spree.

    The most appalling conduct Governor Blagojevich engaged in, according to the complaint filed today or unsealed today, is that he attempted to sell a Senate seat, the Senate seat he had the sole right under Illinois to appoint to replace President-elect Obama.

    Let me take you back eight weeks ago to set the allegations in context. Back eight weeks ago, we the following environment. There was a known investigation of the Blagojevich administration that had been going on for years involving allegations of “pay to play” conduct and corruption. There had been a recent trial of an associate of Governor Blagojevich in which allegations were aired, where people testified that Governor Blagojevich was involved in corrupt conduct. And there was an Ethics in Government Act that was pending, that would go into effect January 1 of 2009, that would bar certain contributions from people doing business with the state of Illinois.

    You might have thought in that environment that “pay to play” would slow down. The opposite happened. It sped up. Governor Blagojevich and others were working feverishly to get as much money from contractors, shaking them down, “pay to play,” before the end of the year. […]

    A bug was placed in the campaign offices of Governor Blagojevich and a tap was placed on his home telephone. And that tap and that bug bore out what those allegations were.

    I’ll give you two examples set forth in the seventy-six-page complaint. One involves Children’s Memorial Hospital, a hospital that obviously takes care of children. At one point, the Governor awarded funding, reimbursement funding to that hospital to the tune of $8 million. But he also indicated privately that what he wanted to get was a $50,000 personal contribution from the chief executive officer of that hospital. In the ensuing weeks, that contribution never came, and Governor Blagojevich was intercepted on the telephone checking to see whether or not he could pull back the funding for Children’s Memorial Hospital. […]

    In addition to the “pay to play” allegations, which are described in greater detail in the complaint, we also were surprised to learn of an extortionate attempt against the Chicago Tribune

    newspaper. The Chicago Tribune had not been kind to Governor Blagojevich, had written editorials that called for his impeachment. And Governor Blagojevich and defendant Jonathan — John Harris, his chief of staff, schemed to send a message to the Chicago Tribune that if the Tribune Company wanted to sell its ballfield, Wrigley Field, in order to complete a business venture, the price of doing so was to fire certain editors, including one editor by name. In the Governor words — Governor’s words, quote, "Fire all those bleeping people. Get them the bleep out of there. And get us some editorial support," close quote. And the bleeps are not really bleeps. The defendant Harris tried to frame the message more subtly to get the point across to the Tribune that firing the editorial board members would be a good thing in terms of getting financing to allow the sale to go forward.

    But the most cynical behavior in all this, the most appalling, is the fact that Governor Blagojevich tried to sell the appointment to the Senate seat vacated by President-elect Obama. The conduct would make Lincoln roll over in his grave. The Governor’s own words describing the Senate seat, quote, "It’s a bleeping valuable thing. You just don’t give it away for nothing," close quote.

    Another quote: "I’ve got this thing, and it’s bleeping golden. And I’m just not giving it up for bleeping nothing. I’m not going to do it, and I can always use it; I can parachute me there," quote. Those are his words, not our characterization, other than with regard to the bleep.

    The tapes reveal that Governor Blagojevich wanted a number of things in exchange for making the appointment to the Senate seat: an appointment as secretary of Health and Human Services or an ambassadorship, an appointment to a private foundation, a higher-paying job for his wife or campaign contributions. At one point, he proposed a three-way deal, that a cushy union job would be given to him at a higher rate of pay where he could make money. In exchange, he thought that the union might get benefits from the President-elect, and therefore, the President-elect might get the candidate of his choice.

    I should make clear the complaint makes no allegations about the President-elect whatsoever, his conduct. […]

    And finally, we should also note that the Governor talked about appointing himself to the Senate seat for reasons not having to do with the better welfare of the citizens of Illinois. He wanted to do it to avoid impeachment in the Illinois legislature for his conduct. He wanted to do it to have access to greater financial resources, if he were indicted. He wanted to do it to see if he could help his wife work as a lobbyist. He wanted to do it to remake his image to run for office in 2016. And he wanted to do it to see if he could generate speaking fees.

    At the end of the day, the conduct we have before us is appalling.

SHARIF ABDEL KOUDDOUS: That was US attorney Patrick Fitzgerald speaking yesterday afternoon. Democracy Now!

co-host Juan Gonzalez was in Chicago on assignment for the New York Daily News when the story broke yesterday morning. He joins us from a studio there. Also with him is David Moberg, senior editor of In These Times magazine.

Good morning, Juan.

JUAN GONZALEZ: Good morning, Sharif and Anjali. Yes, stunning events here in Chicago the past few days with the Governor arrested, handcuffed, taken from his house at 6:00 in the morning by FBI agents, and this stunning criminal complaint by Patrick Fitzgerald.

And David Moberg, the senior editor for In These Times, joins us. And, David, your reaction, when you heard about this yesterday morning?

DAVID MOBERG: Well, I’m accustomed to politicians in Illinois being charged with all kinds of corruption, but this was quite astounding. It really was particularly blatant and audacious. And especially since Blagojevich had very clear understanding that he was being pursued by federal agents and had been almost since the start of his term, for him to continue, as the complaint alleges, to carry on this kind of activity is just really mind-boggling.

JUAN GONZALEZ: Well, not only to continue, but apparently to escalate his activities, according to Patrick Fitzgerald.

DAVID MOBERG: Right, yeah.

JUAN GONZALEZ: Because they began actually a few weeks ago, began taping his conversations and actually had someone close to him wired, and the allegations, especially in terms of the sale of the Senate seat, with all the different kinds of schemes as to how he could benefit from having to appoint someone to replace Barack Obama.

DAVID MOBERG: Right, yeah. Well, it’s particularly galling given the kind of image improvement that the state of Illinois politics had gotten from Barack Obama’s election. You know, to have it drawn back down into the mire again is particularly disturbing.

I think it was also escalated by the passage of this ethics reform law that would have restricted the contributions from contractors with contracts over $50,000. Illinois has never had particularly tough campaign finance laws, which is one of the reasons why this kind of corruption has been allowed to develop as much as it has. So, according to the US attorney, Blagojevich was escalating the kind of fundraising activity at the end of the year.

So these two things converged, this "bleeping golden” opportunity of trying to make something out of the Senate seat or perhaps even to put himself in there, which gives an idea of the kind of ego that’s involved and kind of the recklessness, that he thought that, well, if he couldn’t get enough out of somebody else for appointing someone to the Senate, that he could go in as an appointment of himself and, in that position of being a senator, would be more protected from US indictments. So according to the wiretapping that was going on, he was even contemplating that he was going to be indicted and thinking about, you know, how he might be in a stronger position if he were in the US Senate.

JUAN GONZALEZ: Well, one of the most intriguing aspects, especially for a publication like yours that follows the American labor movement so closely, was the allegation in the complaint that — I think it was on November 12th — that the Governor had a phone conversation with a top leader of the Service Employees International Union — the union official is not named — where he discussed one of his ideas for possibly utilizing the Senate seat to his — the appointment to the Senate seat to his benefit, was asking the SEIU to participate in a three-way deal with the incoming Obama administration, whereby he would appoint a favored candidate of Obama for the seat in exchange for the SEIU giving him a — there were two deals: one, a top job at Change to Win, the reform labor association, or alternatively helping to fund a nonprofit, which he would then run. And supposedly, the leader of SEIU, according to the complaint, says to the Governor, “Well, I’ll run it up the flagpole.” But again, the leader is not mentioned. But it does seem that, to some degree, he was trying to use his ties in the labor movement to effect this bizarre deal.

DAVID MOBERG: Right. Well, the SEIU is denying that there were these conversations that took place, but otherwise not providing much information about what went on. And, you know, at this point, anyway, there is certainly no evidence that they actually had taken steps beyond this, you know, alleged talking about running it up the flagpole.

But Blagojevich had a very kind of troubled relationship with the labor movement. There were certain unions, like SEIU, who supported him very strongly and continued to support him. And, in part, one of the things that they had actually gotten out of the Blagojevich administration was the right to organize homecare workers. So it was roughly 40,000, 50,000 members that they were able to get. And Blagojevich has occasionally done other good things for the labor movement. Just this week, as you probably noted in the course of this factory occupation, he came out just the day before the criminal complaint was filed and said that he was going to get the state of Illinois to withhold all business with Bank of America. So he’s been oddly sort of pro-labor in that regard. But in terms of dealing with public employees and public employee unions, he’s been as difficult for public workers as any Republican, perhaps more so. So he’s had a real mixed relationship with labor. And, you know, labor — many labor unions in Chicago had been part of the traditional political machine and sort of knew how the game was played in Chicago and Illinois, as nearly anybody who had been deeply involved in politics here would obviously know.

JUAN GONZALEZ: Well, the other incredible allegation had to do with the Chicago Tribune —-

DAVID MOBERG: Right.

JUAN GONZALEZ: —- that, supposedly, he and his chief of staff conspired to try to pressure the Tribune to fire several of their editorial writers, including John McCormick, an editorial page editor, because they had been writing all of these editorials criticizing him, and he was threatening to use a state financing agency to withhold support for the Tribune, which owns the Chicago Cubs, to sell Wrigley Field and get a tax benefit as a result of that. So he was using actually his state position as a club to extort firing —-

DAVID MOBERG: Right.

JUAN GONZALEZ: —- of members of the Chicago Tribune staff. Your reaction to that?

DAVID MOBERG: Oh, well, I mean, that’s quite incredible. And, once again, the complaint cites a reaction from the Tribune as the message having been heard, which was sort of ambiguous at the same level as the SEIU alleged comment about running it up the flagpole. So if you believe the complaint information, there was not an immediate rejection of this proposal, even though, obviously, the reporters themselves who are named — McCormick is still working at the Tribune.

But, you know, he’s had a hostile relationship with the press and particularly with the Tribune for a long time, going back even before he was governor. And, you know, part of his whole style of governing has been to run — is combating with everybody else. He started off his tenure as governor taking on the legislature, as if they were the enemy. And this was a Democratically controlled legislature. And Democrats in the state had thought, finally, now we have a Democratic governor after so many years of Republicans in power. And, you know, he started off just fighting with his own legislative leaders.

JUAN GONZALEZ: And also, he was also seen initially as a reform candidate, wasn’t he?

DAVID MOBERG: Right.

JUAN GONZALEZ: He supposedly was running against the corruption represented by former Republican Governor Ryan.

DAVID MOBERG: Right.

JUAN GONZALEZ: Previous to that, he had run for the seat of Dan Rostenkowski —-

DAVID MOBERG: Exactly.

JUAN GONZALEZ: —- who was also convicted of corruption. And so, he was considered a reformer.

DAVID MOBERG: Yeah. Well, that was certainly the banner he campaigned under. And there was really, obviously, not much evidence that he took that agenda seriously, since this was not a question of him having been in office for a while and sort of succumbed to all the seductions of power. Apparently, according to everything the US attorney has on him, that he was beginning these operations from the very get-go.

JUAN GONZALEZ: And your sense of what the impact of this might be in terms of Barack Obama? Clearly, David Axelrod, one of the chief advisers, late last night said he had been mistaken when he told a reporter some weeks ago that Obama had been in conversations with the Governor about the Senate seat. And he’s now denying that. He said he was mistaken. Your sense whether there will be any impact on Obama of this arrest?

DAVID MOBERG: Well, in the complaint itself, there is a discussion about approaching Obama, and, you know, the complaint says Blagojevich, you know, in his usual sort of explicit expletives, was denouncing Obama for not having been willing to make a deal. So, at least at the level of the kind of complaint information, Obama comes out looking pretty clean.

But that’s one of the problems: once you get somebody who’s as tarnished as he is, if you even get within the same room, you begin to get suspect. And that’s going to be one of the things that’s going to probably affect a lot of the candidates who were looking forward to being named as US senator, such as Congressman Jesse Jackson, Jr., who had met with Blagojevich. And simply the fact of having met with him shouldn’t implicate anybody, but under these circumstances it’s going to have kind of a tarnishing effect on everybody.

I don’t know. It had looked before like things were very secure for Democrats. Name a Democratic candidate to fill out the remainder of the term, and then, as incumbent, would be in a strong position probably to run. Illinois is still a fairly strongly Democratic state, but whether now there’s such a backlash against all this that a Democrat has trouble is hard to tell at this point. I think that it still should be a safe seat. But that would actually be, politically, on a national level, one of the worst outcomes, if, in the wake of all this, that a Republican took that seat.

JUAN GONZALEZ: Well, we’ll have to — we’ll be keeping tabs on this, a possibility that there may now be a special election —-

DAVID MOBERG: Right.

JUAN GONZALEZ: —- for this seat. The state legislature will have to be deciding that over the next few days.

I want to thank you, Dave Moberg, senior editor for In These Times, for being with us. And when we return from break, we’ll be looking at another major story here in Chicago: the fight of the workers at Republic Windows & Doors, who have been sitting in in their factory now for several days.

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