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Keating Economics: The Video

Posted October 7th, 2008 by Corey deVos in The Daily VOS

A new video was released today to combat McCain and Palin's "guilty by association" Swiftboat tactics of the past few days, recycling names like Wright and Ayers in attempt to tear down Obama's credibility (such as Palin saying that Obama "pals around with terrorists"). 

While i am straining to keep this post as neutral as possible (i have a tummy ache from swallowing all the vitrol), it really seems like a fairly boneheaded move on McCain's behalf, considering his and Sarah Palin's own sordid history of being involved with controversial people--such as Palin's visit with the witch-doctor and her very personal association with a government-hating Alaska Secessionist Party (a group whose founder damned America and cursed the flag, was quoted as saying "the fires of hell are frozen glaciers compared to my hatred for the American government...and I won't be buried under their damn flag... I'm an Alaskan, not an American. I've got no use for America or her damned institutions," and was later murdered in a "plastic explosives sale gone bad.")

All of that, of course, pales in comparison to McCain's involvement in the famous Keating Five scandal, which bears enormous relevance to today's political and economic climate.  Here is a video the Obama camp released today: 

From the website:

The current economic crisis demands that we understand John McCain's attitudes about economic oversight and corporate influence in federal regulation. Nothing illustrates the danger of his approach more clearly than his central role in the savings and loan scandal of the late '80s and early '90s.

John McCain was accused of improperly aiding his political patron, Charles Keating, chairman of the Lincoln Savings and Loan Association. The bipartisan Senate Ethics Committee launched investigations and formally reprimanded Senator McCain for his role in the scandal -- the first such Senator to receive a major party nomination for president.

At the heart of the scandal was Keating's Lincoln Savings and Loan Association, which took advantage of deregulation in the 1980s to make risky investments with its depositors' money. McCain intervened on behalf of Charles Keating with federal regulators tasked with preventing banking fraud, and championed legislation to delay regulation of the savings and loan industry -- actions that allowed Keating to continue his fraud at an incredible cost to taxpayers.

When the savings and loan industry collapsed, Keating's failed company put taxpayers on the hook for $3.4 billion and more than 20,000 Americans lost their savings. John McCain was reprimanded by the bipartisan Senate Ethics Committee, but the ultimate cost of the crisis to American taxpayers reached more than $120 billion.

The Keating scandal is eerily similar to today's credit crisis, where a lack of regulation and cozy relationships between the financial industry and Congress has allowed banks to make risky loans and profit by bending the rules. And in both cases, John McCain's judgment and values have placed him on the wrong side of history.