Keating Five Documentary Released by Obama Campaign

As I mentioned earlier today, the Obama Campaign released today a 13-minute documentary that covers John McCain’s involvement in the Keating Five scandal. The scandal involved a huge failure of some savings and loans, where it was believed some elected officials, McCain being one of them, were complicit in the fraud involving these S&Ls along with financier Charles Keating.

It is important to note that while John McCain was cleared in the actual scheme, the Ethics Committee did not approve of his behavior in the matter. Here’s a brief entry from Wikipedia that summarizes the Ethics Committee’s take on McCain:

The Ethics Committee ruled that the involvement of McCain in the scheme was also minimal, and he too was cleared of all charges against him. McCain was criticized by the Committee for exercising "poor judgment" when he met with the federal regulators on Keating's behalf. The report also said that McCain's "actions were not improper nor attended with gross negligence and did not reach the level of requiring institutional action against him....Senator McCain has violated no law of the United States or specific Rule of the United States Senate."

But the video explains a little more of McCain’s involvement, which does seem to cofirm that John McCain’s judgment was certainly poor.

If you have the time to spare, watch, or simply listen to the YouTube video below. There is also a scathing article from the 1989 Phoenix News, which referred to McCain as “The Most Reprehensible of the Keating Five” (excerpt follows)“ :

You're John McCain, a fallen hero who wanted to become president so desperately that you sold yourself to Charlie Keating, the wealthy con man who bears such an incredible resemblance to The Joker.

Obviously, Keating thought you could make it to the White House, too.

He poured $112,000 into your political campaigns. He became your friend. He threw fund raisers in your honor. He even made a sweet shopping-center investment deal for your wife, Cindy. Your father-in-law, Jim Hensley, was cut in on the deal, too.

Nothing was too good for you. Why not? Keating saw you as a prime investment that would pay off in the future.

So he flew you and your family around the country in his private jets. Time after time, he put you up for serene, private vacations at his vast, palatial spa in the Bahamas. All of this was so grand. You were protected from what Thomas Hardy refers to as "the madding crowd." It was almost as though you were already staying at a presidential retreat.

Like the old song, that now seems "Long ago and far away."

Since Keating's collapse, you find yourself doing obscene things to save yourself from the Senate Ethics Committee's investigation. As a matter of course, you engage in backbiting behavior that will turn you into an outcast in the Senate if you do survive.

They say that if you put five lobsters into a pot and give them a chance to escape, none will be able to do so before you light the fire. Each time a lobster tries to climb over the top, his fellow lobsters will pull him back down. It is the way of lobsters and threatened United States senators.

And, of course, that's the way it is with the Keating Five. You are all battling to save your own hides. So you, McCain, leak to reporters about who did Keating's bidding in pressuring federal regulators to change the rules for Lincoln Savings and Loan.

When the reporters fail to print your tips quickly enough--as in the case of your tip on Michigan Senator Donald Riegle--you call them back and remind them how important it is to get that information in the newspapers.

The story of "the Keating Five" has become a scandal rivaling Teapot Dome and Watergate. The outcome will be decided, not in a courtroom, but probably on national television.

Those who survive will be the sociopaths who can tell a lie with the most sincere, straight face. You are especially adept at this.


It goes on, and you can read the rest at this link.

I have very strong recollections, and also strong feelings about the whole Keating Five matter. One of the Savings and Loans in which my husband had our life savings and checking accounts with were temporarily closed when the scandal first broke, amid concerns that certain S&Ls outside the failure of Lincoln Saving and Loan were somehow connected and also possibly not solvent. Imagine not having access to any of your money for even a few days, when you are unable to write a check or withdraw cash. It is unsettling to say the least. And while McCain was cleared of the actual fraud, just in the fact that he was called out for his poor judgment tells me that he did have some involvement in this mess. While it technically wasn’t fraud, it seems like he stepped on the line.

So, if you have time to watch or listen to the video, you should do so. If not, take a moment to read some of the articles at the link I’ve provided here and just read a bit to get a flavor for the magnitude of this mess. Yes, it happened long ago. But to me, it is paints a picture of the real John McCain.





If you have trouble loading the video above, it can also be viewed at the following link from Keatingeconomics.com .

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Wall Street Whiplash!

OK, not that I am complaining, but this last week on the stock market has given my portfolio a case of whiplash. After loosing a few thousand dollars in my 401K-rollover account a few days ago - in the blink of an eye – I am now back to where I started. In fact, I may be a little better off, since my smart husband decided that the bloodletting on Wall Street was a good time to double down on a few stocks that we’d lost some ground on over the last few weeks (like Bank of America, ticker BAC ).  The stock market these days is not for the faint hearted. In fact, the great oil man, industrialist, philanthropist, and monopolist John D. Rockefeller said “The way to make money is to buy when blood is running in the streets.”  Wall Street has been flowing with it this past week, much of it Wall Street’s own doing. (It was a good time to buy stocks, though.)

This whole situation made me reflect a little about President Bush’s previous plan to privatize social security that died on the vine. I was actually initially in support of the plan, but admit that I felt that the average person probably wouldn’t be able to correctly manage this money long term  for a decent return. As hindsight is always 20/20, it looks like a good thing that nothing happened to turn management of social security over to the masses. We could have had millions of people who lost a lot of their money making rash decisions over the last few days. 

Still, I have concerns that when I reach the age where I can collect on my social security that there will be nothing for me to collect, so I would like to have some of that money allotted to me given to me now so I can have some control over it. The flip side is had that happened, imagine the panic would have ensued had people lost money in their social security investments this past week. And seeing the number of people who can’t afford to maintain the mortgages on their bloated homes and mortgages, it’s likely they could have somehow blown that money too.

It also makes me reflect on the whole Keating Five corruption scandal, which caused some Savings and Loans institutions to fail, and also had political repercussions. Senator John McCain had connections; he, along with Senator John Glenn,  were cleared of acting improperly, but they were criticized for having exercised "poor judgment".

With the complexity of money matters in the country and in the world, I want someone leading the country that has a better grasp of economics, and also who will likely obtain an experienced group of financial advisors who can look at how money is handled - big picture -  in this country,  once and for all. And John McCain, who has admitted that economics is a weak spot for him, and who was cited for “poor judgment” in the Keating scandal, just isn’t the person to heal our fragile economy. After all, while I don’t mind the occasional Wall Street whiplash every now and then, I’m not in the mood to lose my financial security for my retirement years.


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