Sen. Barack Obama (D-Ill.) on Monday will launch a multimedia campaign to draw attention to the involvement of Sen. John McCain (R-Ariz.) in the “Keating Five” savings-and-loan scandal of 1989-91, which blemished McCain’s public image and set him on his course as a self-styled reformer.
Retaliating for what it calls McCain's “guilt-by-association” tactics, the Obama campaign is e-mailing millions of supporters a link to a website, KeatingEconomics.com, which will have a 13-minute documentary on the scandal beginning at noon Eastern time on Monday. The overnight e-mails urge recipients to pass the link on to friends.
Here's where the attempt to focus attention on Keating will create problems for Obama:
In the mid 1980s Mr. Keating had engineered $1.3 million in campaign contributions to the five lawmakers. In return he expected the senators to lean on federal bank regulators to back off from their investigation into his shaky institution, which was crippled by poor junk-bond investments and real-estate speculation. The central event came in April 1987, when the senators met twice with Federal Home Loan Bank Board examiners, who charge that the senators pressured them to leave Lincoln alone. Sensing impropriety, Senators McCain and Glenn quickly withdrew (as Mr. Bennett recognized when he recommended last September that they be dropped from the probe). Senators Cranston, DeConcini, and Riegle, however, continued to press Mr. Keating's case. Eventually the government was forced to seize Lincoln anyway, at a bailout cost to taxpayers of $2 billion.
In the Senate Democrats refused to release McCain from the investigation even after it was clear he hadn't done anything wrong. They wanted a bipartisan scandal and the other four senators were Democrats. The Democratic special counsel recommended that McCain be complete exonerated.
Not much of a scandal on McCain's part.
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