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[Bumped up from Saturday, updated and comments opened.]
* Taken on its own [and combined with a new update below], a new Sun-Times story looks more promising than it may actually be. But things might become more clear once we connect some dots with another story published today.
First, the Sun-Times…
A Chicago developer and donor to Gov. Blagojevich steered more than $100,000 in commissions to first lady Patti Blagojevich’s real estate firm before a business owned by the developer’s parents saw dramatic increases in state payments. […]
In 2002, before Blagojevich took office, the state paid Tiran’s parents’ home-care company for the developmentally disabled, Diane Home Care, $183,000. In 2003, during the governor’s first year in office, the payments increased to $325,000. Last year, Diane Home Care did $1.1 million in state business through a contract with the Human Services Department. […]
Sources who spoke to the Sun-Times on condition of anonymity said [FBI] agents had asked questions about Patti Blagojevich’s real estate dealings with Rezko. The work got under way in July 2003 — about six months after the governor began accepting Rezko’s recommendations to place people on state boards and about eight months after Patti Blagojevich landed a $47,000 commission from a Rezko land deal.
A few things to remember…
1) This doesn’t appear to be about Rezko.
2) Patti Blagojevich has had a real estate license for a long time. Every one of Dick Mell’s kids has a license. She’s known politically connected people almost all her life.
3) There is no stated direct link between the increases to the DD home-care business and the real estate connections. There may be a rational explanation. But so far, the corruption is all implied.
4) Tiran and his companies have given just $20,525 to the governor’s campaign fund. Not a lot by any stretch.
* So, this AP lede is way out of line with the facts in the Sun-Times story…
Commissions Gov. Rod Blagojevich’s wife made in her real estate business are linked to increased revenue for a state contractor’s family business, according to a published report.
Not quite.
* A new Tribune story claims Mrs. Blagojevich’s real estate firm earned $700,000 on real estate deals over seven years. That ain’t much during such an over-heated market. “Of those commissions, the Tribune found more than three-quarters came from clients with connections.” As I explained above in point 3, that doesn’t tell us much, either. She’s known connected people all her life.
* But this is where the dots might be connected. According to the Tribune, Mrs. Blagojevich appeared to use her proximity to power to obtain a job as an investment banker…
“I’m not going to lie to you, it would have been great for us to get one of the state pension funds,” said Peter Contos, president and CEO of North Star, who sponsored the first lady’s application for a federal license. […]
Contos said his firm decided to hire Blagojevich, who has a degree in economics from the University of Illinois, because of her political ties. He said she was recommended to him by an administrative staff member. […]
Contos said he and others at North Star encouraged her to find work at a bigger firm but she touted her connections and her ability to bring in business
* So, to sum up, while there may very well be something to this real estate business, there is no clear connection to wrongdoing as of yet.
However, as the Tribune story alleges, Mrs. Blagojevich touted her obvious political connections and her ability to land state business in exchange for a potentially lucrative job. She was also recommended by an administration insider. That goes directly to how she may have operated, not only in this particular instance, but during her real estate career.
“But after three months she brought in no business,” Contos said. “Obviously, her connections weren’t as strong as advertised.”
In the end, she turned out to be all talk and no action and had to leave the firm. So, nothing is completely clear-cut here.
Still, this is not good news for the Blagojevich family.
*** UPDATE *** The Trib ran a separate story Sunday about that Tiran real estate deal mentioned at the top…
Tiran recently told the Tribune he hired Patricia because she was recommended by the alderman in his ward, and not because of her family ties.
“No impact whatsoever,” he said. “And I believe they sold the whole project. They did a good job.”
[Ald. Dick Mell] said it’s possible he, too, had talked to Tiran about hiring his daughter but saw no problem with it.
“It’s conceivable that I mentioned it to Virgil that if he were looking for somebody to sell the property that my daughter is in the real estate business,” Mell said. “But just because I mentioned it to Virgil doesn’t mean he had to hire her. I’ve helped other Realtors who I know too.”
The real estate story looks even less “bad” now, but there’s still that problem with the revelations about how Mrs. Blagojevich allegedly got that investment banking job.
posted by Rich Miller
Monday, Oct 20, 08 @ 8:15 am
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Exaggerating your abilities during a job interview or having a father try to drum up business for his daughter is not illegal or even unethical. So, why the stories? What’s the big deal? She did a good job selling the condos and made some money. She didn’t do a good drumming up state business and was let go. Nothing out of the ordinary in either case.
Comment by Bill Monday, Oct 20, 08 @ 9:00 am
“Caesar’s wife must be above suspicion.”
Comment by Anon Monday, Oct 20, 08 @ 9:01 am
Rich, I think the effort to get the bank job may not look great, but the results demonstrate that she did nothing inappropriate. the story would have been bad if people were coming forward saying that they were threatened with losing state contracts unless they did something to help Mrs. B. This bit of the story proves that she wasnt successful at utilizing her contacts. No coersion, just failed networking.
Its time to leave this woman alone. What has she done wrong?
Comment by Anonymous Monday, Oct 20, 08 @ 9:07 am
$20,500 isn’t a lot but we know that under the Democrats, state contracts come cheap, as do state jobs worth, potentially, hundreds of thousands over
a lifetime.
I bet this kind of thing happens all the time in the upper reaches of city of Chicago and Illinois state government. Nothing explicit. Nothing illegal, even. But if you want a contract with the state, you keep your ears peeled and you know what you have to do. Contribute to a campaign Give somebody a job. Make a contribution to a charity in some pol’s name. Pick your realtor carefully. Be careful what you say and don’t
put anything in writing. And the taxpayer money will flow.
Comment by Anonymous Monday, Oct 20, 08 @ 9:12 am
This ain’t the kind of reporting I was taught in journalism classes, but it is the kind of reporting I was taught about.
Comment by Captain Flume Monday, Oct 20, 08 @ 9:15 am
The investment banker story is bizarre. How in the world did she or North Star think it was possible, especially in the era of Big Heat, that she could bring in state business. Her husband is the GOVERNOR!
Who are these North Star people? Don’t they read the papers? Did they just want to invite the U.S. Attorney into their business? Dumb or naive, those are the only options.
The AP lede might have presumptively drawn a conclusion, but come on, the story is solid and the ethics stink. On one side, commissions and contracts, on the other side, increased state business.
No one’s even trying to conceal that they’re selling the governor’s office.
Comment by wordslinger Monday, Oct 20, 08 @ 9:23 am
The problem I see with these deals is they probably were pay it back or pay it forward. It is no mere coincidence that companies started getting government contracts after they hired the Mrs.. And there is a huge difference between being a working agent or a tick sucking off another agents work.
This really isn’t breaking any new ground here. Insurance and real estate licenses have been one of the favorite devices for attempting to justify corruption in Chicago since aldermen started salivating over spoils. It is just less satisfying to see a pol get called on it when they’re a nice, pretty lady instead of a Paddy Bauler type.
Comment by Phineas J. Whoopee Monday, Oct 20, 08 @ 9:28 am
Part of the problem with some of the real estate commission is Mrs. B showed up at closing and collected commissions on deals where the principals hadn’t even met her. “Oh, just put her name on the deal” was basically how it is alleged to have happened on multiple big commission deals.
It stinks. Now my informed guess is that the feds offered Blago a deal where he would plead guilty to corruption and they would not indict his wife. The problem with that is his tiny brain and oversized head can’t seem to acknowledge reality and I’m even unsure if he wouldn’t want his wife to take the heat for him.
This ain’t gonna be pretty.
Comment by IrishPirate Monday, Oct 20, 08 @ 9:59 am
Bill, Blago’s got bigger things to worry about than what his wife has been up to. He’s got a state to run and needs to find a way to keep insuring all of those people the court says he can’t insure any longer. I’ve yet to see a person he won’t throw under the bus so we’ll see what happens to the Mrs. Definitely an “up” day for Elvis.
Comment by Just My Opinion Monday, Oct 20, 08 @ 10:06 am
I’m really sorry to read that Mrs. Pinocchio might be in trouble, notwithstanding my contempt for Governor Pinocchio’s miserable performance as Governor the last two years. When push comes to shove, let’s hope he has the decency to spare his wife and children the tragedy of having both parents indicted.I’m still reserving judgemnt about First First Lady A’s participation in her husband’s criminal schemes and machinations.
Comment by Captain America Monday, Oct 20, 08 @ 10:42 am
Like father, like daughter
or if you like
Like husband, like wife
Take your pick.
Comment by Enough Said Monday, Oct 20, 08 @ 10:44 am
I don’t believe the governor will step down solely because of these rather hard to prove influence-peddling allegations, but if he were to do so….when?
He resigns soon, that gives Pat Quinn a couple of years to gear up for a run, and the powers of incumbency are great.
He resigns closer to 2010, that improves the chances of arch-rival Madigan’s daughter, who will be waiting in the primary wings, so to speak.
An interesting dilemma…although, as I say,
I think he’d vastly prefer to stay in the job and run in 2010. If he can win the primary, he’s got the job for another four years.
Comment by Anonymous Monday, Oct 20, 08 @ 11:17 am
Mrs. Blago gets her investment license and job. Around the same time the state deferred compensation program proposed significant changes to administrative rules that have not yet been acted on concerning investments. There have been whispers in Springfield that the Blagos might be trying to influence employee’s deferred compensation investment dollars similar to the Teacher’s Retirement System fiasco. Could that have been the State investment business Mrs. Blago didn’t deliver? Wouldn’t that be some dots if they connected.
Comment by BigBob Monday, Oct 20, 08 @ 12:15 pm
Why should a government employee pension system be subject to any kind of influence, direct or indirect, from politicians. Pols’ ability to influence decision-making regarding these systems seems to lead to all kinds of mischief…in recent years, both Democrats and Republicans have been accused of mucking about in decisions about
where to invest, and so on.
Politicians, it appears, will always be corrupt and easily susceptible to unsavory influences. But it should be possible to set up regulations surrounding pension systems which make it impossible for them to have any influence at all. Hoping we’ll get an honest pol next time seems absolutely beyond naive.
Comment by Anonymous Monday, Oct 20, 08 @ 3:01 pm
Rich-big money is like beauty, in the eye of the beholder, but AA guesses most guys would be ecstatic if the Mrs. knocked down $700k in that period of time for a part-time, no nail breaking job. You also can’t forget that she had a baby in that timeframe along with two campaigns, all of which one would presume interfered with the “career.”
BigBob, go to the head of the class, dude. There are some real smart guys down here and up there tryin’ to connect those exact dots. Different reasons, though.
Anon, your point is also spot on and should be a given; in many states, it is. Not in Illinois.
Whether it’s the pay to play kind of influence, the labor union influence, the social investing influence (Boy, that divest Sudan law brought the violence to a screeching halt. Not.) or affirmative action influence, (help struggling firms like Ariel with 10 billion get more State business, so what if they lose money..) Illinois is sadly right at the top, primarily due to single party government.
Comment by Arthur Andersen Monday, Oct 20, 08 @ 8:46 pm
Sadly, AA you can only blame the GOP for single-party government. It’s astounding given the nonsense of Blago, Daley, Stroger, et al that the GOP is only a rumor in Illinois.
Comment by wordslinger Tuesday, Oct 21, 08 @ 8:54 am