Degree of Madness

Taxpayers to Loan Auto Industry $17.4B

The actual headline reads:  White House to Loan Auto Industry $17.4B.  I believe mine is more accurate. 

Yes, it would be devastating if GM and/or Chrysler failed.  But this loan is not the only option.  Yesterday it was reported President Bush was considering managed bankruptcy for the automakers, as a last resort "to be used only if an agreement for a voluntary overhaul of the industry could not be reached".  The UAW and auto executives fought bankruptcy because they do not want to overhaul the industry.  Union leaders especially do not want to make the drastic concessions necessary for the automakers to survive:

In a traditional bankruptcy proceeding, the U.A.W.’s contracts could be voided and the union forced to renegotiate benefits like health care.

Health care benefits, especially for retirees, are crushing the Big Three:

GM, for instance, has about 450,000 retirees - more than three times the number of its current full-time employees - to whom it pays pensions and for whom it provides medical care. By some estimates, medical costs alone add $1,500 to the average cost of each GM automobile. And the company is facing an unfunded liability of more than $80 billion, about half its annual pre-downturn gross sales, for future health-care costs for employees and retirees and their dependents.

Which explains the old joke that GM is no longer a car company that provides health benefits, but a health-care company that happens to make cars.  Unfortunately, the joke's on us.  It is now the responsibility of the taxpayers to insure the continued funding of bottom-line busting health care benefits.  

UAW President Ron Gettelfinger has consistently maintained bankruptcy is not an option.  Yes, it is.  No it's not something most companies want to do but when faced with overwhelming costs and a need for drastic restructuring, bankruptcy is the most viable option.  Bankruptcy courts exist for this very reason.  As for the (supposed) main objection to bankruptcy, that no one would buy a car from an automaker in Chapter 11, surveys don't back it up:

A pair of new surveys suggest buyers aren't completely unwilling to buy a car from an auto maker in bankruptcy court, as long as the federal government is willing to play a role in helping the company restructure.

This contradicts the conventional view of Detroit auto makers that suggests consumers would shun a bankrupt auto maker over fears related to the resale value of a car, the warranty and the ability to secure service and replacement parts.

Too bad the survey didn't ask another question:  Would you be more willing to buy from a company in bankruptcy or one in "bailout"? 

It will be interesting to see exactly what concessions the UAW is making in exchange for $17.4 billion.

Paul Weyrich, R.I.P.

The Heritage Foundation:

Paul M. Weyrich, chairman and CEO of the Free Congress Foundation and first president of The Heritage Foundation, died this morning around 1 a.m. He was 66 years old.

A giant leaves us today.  Michael G. Franc:

There are many ways to honor the dead. In the case of Paul Weyrich, I respectfully suggest that we forget about the flowers, as important as they may be. Rather, the most appropriate way to pay tribute to this remarkable man is for us to speak the profound, eternal truths in the public policy arena, especially when doing so may cause some personal or professional discomfort. It would only deepen and extend his most enduring legacy.

I agree.

Godspeed, Paul.  You will be missed.  R.I.P.

Caroline Kennedy's qualifications for Senate

Sorry.  I just could not resist.  The truth is sometimes catty and unattractive.


via: Don Surber

5 Bama players named AP All-Americans, 3 to first team

Over 1000 pounds of linemen:

The three Alabama All-Americans also were the most first-teamers by any school in the country.

Offensive tackle Andre Smith of Huffman, listed at 330 pounds, was a unanimous first-team choice, and was joined by center Antoine Caldwell. Crimson Tide nose guard Terrence Cody, listed at 365 pounds, anchored the top-ranked defense in the Southeastern Conference.

Between Smith at 330, Caldwell at 305 and Cody at 365, that's over 1,000 pounds of linemen.

Smith, a junior, won the Outland Trophy last week. The award is given to the nation's top lineman,.

Well done, Guys!  Andre Smith was awarded the Outland Trophy last week. 

Rashad Johnson was named to the second team and Roland McClain to the third.  Rolltide.com:

Johnson, a former walk-on and second-team All-America selection, has developed into one of the finest safeties in college football after accounting for 82 tackles, five tackles for loss (-15), one sack (-7), five interceptions – two of which were returned for touchdowns – and 11 pass break-ups. His 16 passes defended lead the SEC and is tied for 21st nationally. Johnson was selected as a first-team All-American by the American Football Coaches Association and was a second-team Walter Camp All-American.

McClain, a sophomore middle linebacker, garnered third-team accolades after leading Alabama with 91 tackles and 11.0 tackles for loss (-44). He ranked second on the team with 3.0 sacks (-22) while intercepting one pass, recording five pass breakups and recovering two fumbles.

More honors for the Crimson Tide:

Alabama freshmen Julio Jones and Dont’a Hightower were named to the Sporting News’ 2008 All-Freshman Team on Tuesday.

Jones, a wide receiver from Foley, Ala., was selected to the first team while Hightower, a linebacker from Lewisburg, Tenn., was named to the second team.

Jones set Alabama freshman records for receptions (51), receiving yards (847) and touchdowns (4). He led the Crimson Tide in all three categories while ranking fourth in the SEC in receiving yards per game (65.2) and seventh in receptions per game at 3.92.

Hightower ranks fourth on the team with 62 tackles headed into the Allstate Sugar Bowl against Utah. He started 12 games and has 2.5 tackles for loss (-6) and five quarterback hurries. Hightower also recovered two fumbles and forced one fumble.

Rolltide.com has a complete list of 2008 Crimson Tide All-Americans.  More to come.

Pelosi: bankruptcy is not an option

An announcement could be made by Wednesday:

The Bush administration was considering using money from the $700-billion Troubled Asset Relief Program, designed to help the financial services sector, to provide the emergency loans to automakers. House Speaker Nancy Pelosi (D-San Francisco) told reporters Monday that she was optimistic action would come "sooner rather than later."

"All the signals coming from the White House are that they know that bankruptcy is not an option, and that TARP funds are the only recourse" after a $14-billion auto bailout bill failed in the Senate last week, Pelosi said.

Todd Zywicki debunks this mantra and offers a reasonable explanation why some in Congress are refusing to consider bankruptcy as a solution to the (self-inflicted) mess the automakers are in.  Bankruptcy Is the Perfect Remedy for Detroit:

While Washington tries to arrange a bailout, the Detroit Three auto makers and their union, the United Auto Workers, keep insisting that bankruptcy would be the kiss of death. Not so: a Chapter 11 bankruptcy filing will likely result in a stronger domestic industry.

To understand why, consider that the fundamental question to ask of any firm facing bankruptcy is whether it is "economically failed" or simply "financially failed."

...

General Motors looks like a financially failed rather than an economically failed enterprise -- in need of reorganization not liquidation. It needs to shed labor contracts, retirement contracts, and modernize its distribution systems by closing many dealerships. This will give rise to many current and future liabilities that may be worked out in bankruptcy. It may need new management as well. Bankruptcy provides an opportunity to do all that. Consumers have little to fear. Reorganization will pare the weakest dealers while strengthening those who remain.

So why do the Detroit Three managements and the UAW insist that "bankruptcy is not an option"? Perhaps because of the pain that would be inflicted upon both.

The UAW doesn't want to take the strong medicine that would be required under bankruptcy.  Its leaders know that Congress is not inclined to force major concessions on the union or to scrutinize it too closely.  Management has more to fear from Congressional oversight but it would still be considerably more pleasant than facing a bankruptcy judge:

Those Washington politicians who repeat the mantra that "bankruptcy is not an option" probably do so because they want to use free taxpayer money to bribe Detroit into manufacturing the green cars favored by Nancy Pelosi and Harry Reid, rather than those cars American consumers want to buy. A Chapter 11 filing would remove these politicians' leverage, thus explaining their desperation to avoid a bankruptcy.

In short, Detroit and the public has little to fear from a bankruptcy filing, but much to fear from the corrupt bargain that is emerging among incumbent management, the UAW and Capitol Hill to spend our money to avoid their reality check.

Management might be in for a few surprises, however.  Congressional Democrats are notorious for mandating burdensome regulations on employers. As Zywicki points out, by handing over "free taxpayer money" they will dramatically increase their leverage.  To the detriment of us all.

This bailout will give more power to self-interested politicians in Washington.  The hammer will be aimed at management, UAW will operate pretty much as ususal, and the Big Three will continue losing market-share to those dastardly foreign automakers in the South.

And this is just the beginning.  In the not so distant future we'll be hearing how we must give the Big Three another loan, and another.  "Taxpayers have too much money invested to let the automakers fail" will be the story line.  A nationalized automobile industry will be the result.  It's starting now.

Yikes! Washington Post writer Carol D. Leonnig: Birmingham is in "massive bankruptcy"

Grand Jury Investigates Richardson Contributor:

A federal grand jury is investigating whether a financial firm improperly won more than $1.4 million in work for the state of New Mexico shortly after making contributions to political action committees of Gov. Bill Richardson (D).

The probe focuses on whether the governor's office urged a state agency to hire CDR Financial Products. The probe is in a highly active stage at a time when President-elect Barack Obama has chosen Richardson as his nominee for secretary of commerce, according to two sources familiar with the investigation.

...

The inquiry is part of a long-running nationwide investigation into "pay-to-play" practices in local government bond markets. In other cities, federal investigators are questioning whether financial firms have lavished politicians with money and gifts in exchange for fee-paying work advising municipal and local governments on investments. Authorities indicted the mayor of Birmingham, Ala., this month on charges of taking hundreds of thousands of dollars in gifts and loans from a firm that led the city into toxic investments and massive bankruptcy.

For the record

A 101-count federal indictment unsealed today charges Birmingham Mayor Larry Langford, Montgomery investment banker William Blount, Blount Parrish and Co. and longtime Langford friend Al LaPierre with a series of crimes in connection with Jefferson County bond transactions and swap agreements.  

The indictment charges the three men and Blount Parrish and Co. with conspiracy, bribery, fraud, money laundering, and filing false tax returns in connection with a long-running bribery scheme.

Chicago Tribune story fast tracks Blagojevich arrest

Why did U.S. Attorney Patrick Fitzgerald decide to arrest Illinois Governor Rod Blagojevich on Tuesday, December 9?  Because of a story the Chicago Tribune published on Friday, December 5.  Cam Simpson, reporting for The Wall Street Journal:

At Fitzgerald’s request, the paper had been holding back a story since October detailing how a confidante of Blagojevich was cooperating with his office.

...

But editors decided to publish the story on Friday, Dec. 5, ending the Tribune’s own cooperation deal with the prosecutor.

Which brings up another "why"?  Why did the editors decide to end their cooperation with Fitzgerald?  Thanks to the paper's tipoff, Blagojevich was able to "undo" a meeting he had his brother, “Fundraiser A", set up with an alleged supporter of Jesse Jackson, Jr., "Senate Candidate 5".  December 4:

...Blagojevich allegedly told his brother, a man identified in the affidavit as “Fundraiser A,” that he was “elevating” Mr. Jackson on the list of candidates, because the governor might be able to get something “tangible up front” for the pick.

He told his brother to meet with someone (unidentified by the feds) whom the pair believed to be close to Jackson. He urged his brother to tell this alleged supporter of Jackson that “some of this stuffs gotta start happening now… right now…and we gotta see it. You understand?” He was talking about campaign cash, the feds allege.

Then he allegedly offered his brother one final proviso: “I would do it in person. I would not do it on the phone.”

The next morning, on Friday, Dec. 5, it all came crashing down for the FBI agents underneath the headphones.

Thanks to this blaring headline:

“Feds taped Blagojevich; TRIBUNE EXCLUSIVE: Adviser cooperated with corruption probe, sources say.”

Here is how Fitzgerald addressed the Tribune article at the press conference following Blagojevich's arrest:

QUESTION: Mr. Fitzgerald, would you make clear just something about the timing here? When the Tribune ran its story a few days ago revealing that the governor was being taped, would you explain -- and I think some of this is laid out in the complaint -- did further taping take place or did that essentially terminate your ability to listen in?

MR. FITZGERALD: Well, what I would say is, to back up and to the extent that there have been articles, I'm not confirming or denying the accuracy of the articles. You can compare them against what happened.

I will say this, as you guys know, you guys are in the information business of getting it and publishing it, and we're in the information business of getting it and using it.

About eight weeks ago, before we had the bug installed and before we had the wiretap up, we were contacted by the Tribune to comment or confirm or deny on a story that they were going to run.

Had they ran that story, we thought we'd never have the opportunity to install the bug or place the telephone tap. And we made an urgent request for the Tribune not to publish that story.

That is a very rare thing for us to do and it's an even rarer thing for a newspaper to grant. We thought that the public interest required that the story not run.

It was a difficult conversation to have because we weren't allowed to describe what we doing, and I have to take my hat off that the Tribune withheld that story for a substantial period of time, which otherwise might have compromised the investigation for ever happening. And I think that's something that we should take note of.

And later, at a later point in time that story did run. I believe it ran on Friday morning. And we were recording after the story ran that said feds tape of Blagojevich, and as set forth in the complaint, days before, or even the day before that story ran, Governor Blagojevich was intercepted telling his fund-raiser to have that conversation about wanting to see campaign contributions up front and telling him to talk as if the whole world is listening; be careful, do it in person, not over the telephone.

And then, after the story ran, we got a different conversation the next day, which basically says, undo what you just did.

So it was clear that the reaction to the story was to think that they shouldn't proceed down that road. So to the extent that we had a number of weeks of interception (inaudible) the telephone, I do -- I do think we -- we ought to credit the Chicago Tribune that they agreed to that request.

They didn't agree to all our requests. As you might imagine, they saw it differently than we did. But I appreciate that and respect what they did.

That's curious.  He takes his "hat off" that the Tribune held off so long?  The story broke just before Blagojevich was about to (attempt) to make the deal with "Senate Candidate 5", Jesse Jackson, Jr.  I believe Fitzgerald would have a better case if the governor had been caught in an illegal act rather than conspiring to commit one. 

The Tribune does have an interest in this case, other than just breaking the story:

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.

Maybe the editors were just interested in payback and not interested in seeing Jesse Jackson, Jr., among other prominent political figures, possibly leading to Barack Obama, implicated. The timing is suspicious, to say the least. 

And it's not the only suggestion of  suspicious timing in this sordid mess.

President Bush in Iraq - Troops give him a tremendous sendoff

Magnificent and well deserved. Both the honor President Bush has given to our troops and the honor they have given him.

North-South smokescreen?

Divide and Conquer.

Headlines: Views on Auto Aid Fall on North-South Divide

       It's North vs. South in Big Three bailout fight

       Auto Bailout:  North vs. South

And on and on it goes.  I guess some folks haven't noticed that senators from Colorado, Wyoming, Montana, Utah, Minnesota, Idaho, Nevada, Iowa, New Hampshire, Arizona, Alaska, Kansas and South Dakota voted against the bailout.  Oklahoma and Texas too but sometimes they get lumped in with us. 

Southern Senators plot against UAW and Main Street:

"What this is is the Southern conservative senators trying to destroy the United Auto Workers, trying to destroy unions," said Mike O'Rourke, president of a UAW local at a GM factory in Spring Hill, Tenn., (Senator Bob) Corker's home state. "It's a sad day in America when the senators turn their back on Main Street."

Southern senators are being singled out because many foreign automakers have plants in the south.  (There are three foreign plants here in Alabama:  Honda, Mercedes-Benz and Hyundai). So the senators must have had an ulterior motive for opposing the bailout, right?  Protect the foreign companies at the expense of Mom, Apple Pie, and Chevrolet.  The problem with that theory is that the failure of the Big Three would harm the entire automotive industry, foreign and domestic.  And there's some irony at work here, too.  If the UAW were to agree to some of the concessions proposed by Senator Corker, the Big Three would become more competitive and sell more cars, thus cutting into the market share of the foreign companies.  At any rate it is outrageous that union leaders and members of Congress, among many others, are accusing these senators of intentionally trying to kill the Big Three and millions of jobs with it.  That's a pretty harsh accusation with nothing to back it up.  Their motives are being questioned simply because of where they live.  Those senators from other parts of the country who also voted no don't seem to be taking quite the heat that southerners are.  Why is that? 

(Speaking of ulterior motives.  Has anyone questioned the motives of the Democrats who voted for the bailout?  Since 1990, the United Auto Workers union has contributed almost $25 million to Democrats.  During the same period the union gave $180,200 to Republicans.  Quite a gap.  Of the 35 Nay votes on the cloture motion only 4 were Democrats.  One of those was Senate Majority Leader Harry Reid who voted no in a procedural move.  Here is a link to the roll call).

Turning this into a North vs. South issue serves no good purpose.  Besides, polls consistently showed a majority of Americans opposed the bailout.  This southerner opposed the bailout and never gave one thought to the automakers here in Alabama.  Regardless, there are GM, Chrysler and Ford dealers across the state.  Many Alabamians work at these dealerships and for companies that supply them.  Many more Alabamians drive the cars they sell.  If any one of the automakers fails it would affect jobs here.

But I think there's something else at work here.  The UAW has long tried to unionize the automobile plants in the South.  And has failed miserably:

The southern auto belt from South Carolina to Texas, home to eight German, Japanese, or Korean plants (plus three more under construction), is right-to-work country. In these states, workers can't be compelled to join a union or pay dues, and not many are inclined to sign a union card anyway. The result: The UAW has failed miserably to organize workers. No Mercedes, VW, Honda, Toyota, Hyundai (KIA's parent), BMW, or Nissan plant in the South is unionized.

Unionizing these plants is a top priority for UAW.  Come January the union is going to get a little help from its Democratic friends in Washington.  The Employee Free Choice Act, commonly referred to as "Card Check" would abolish the secret ballot now used when employees vote on unionization:

The act would effectively strip workers of the protection of secret ballots in union certification elections. Replacing the privacy of the voting booth, workers would be asked to publicly sign cards indicating support for a union, exposing them to harassment and intimidation. Unions could badger workers repeatedly, at work and at home, to sign a card acquiescing to representation and, in most cases, employers would have limited ability to give workers their side of the story.

Thus making it easier, and cheaper, to drag these plants down to Detroit's level and, of course, increase union dues.  Barack Obama and congressional Democrats support this legislation (see contribution figures above) and when the new Congress takes over in January it will be a priority (see contribution figures above). The legislation will certainly be opposed by most Republicans, including the ones who voted against the bailout.  It serves UAW's purpose to paint the senators as anti-union, anti-little guy, anti-America, possibly gaining sympathy from the voters and intimidating fence-sitters in Congress - although workers in the South might not be intimidated.  Kathy Ward works for Nissan in Smyrna, Tennessee:

"Some were wholehearted for the union, I was wholehearted against," she recalled of the last union vote in 2001.

"I don't need anyone to speak my mind for me. And I certainly don't want to pay someone to do it for me."  

One could take a look at what's happening today with the Big Three automakers and come to the conclusion Kathy Ward has a point.  Bottom line though, UAW wants this legislation passed and has paid big money to get it done.  Demonizing those who might stand in the way could serve a greater purpose down the road.  And framing the debate as North vs. South could be nothing more than a calculated scheme to further serve that purpose.  That would be an ulterior motive. 

Barack Obama, saddened and unaware

Once again the septic tank that is Chicago politics has stopped up and the sewage is overflowing.  And once again Barack Obama is saddened - and blissfully unaware of Illinois Governor Rod Blagojevich's "maneuvering".  Barack Obama is going to be the leader of the free world, in fact he's going to change the world!  If his time in Illinois is any indication, the world is in a heap of trouble.  Apparently he went from a Chicago community organizer, to the Illinois State Senate, to the United States Senate with one eye closed and a banana in his ear.  Or maybe he just didn't want to know.

Obama's reaction to his friend and financial supporter Tony Rezko's conviction on multiple corruption charges:

“I’m saddened by today’s verdict,” Obama said Wednesday. “This isn’t the Tony Rezko I knew, but now he has been convicted by a jury on multiple charges that once again shine a spotlight on the need for reform. I encourage the General Assembly to take whatever steps are necessary to prevent these kinds of abuses in the future.”

Obama's response to comments made by his (former) preacher, Jeremiah Wright:

"I am outraged by the comments that were made, and saddened over the spectacle that we saw yesterday," Obama said.

"The person I saw yesterday was not the person that I met 20 years ago. His comments were not only divisive and destructive, but I believe they ended up giving comfort to those who prey on hate," he said.

Obama was deeply disappointed in his friend and supporter Father Michael Pgleger:

“As I have traveled this country, I've been impressed not by what divides us, but by all that that unites us. That is why I am deeply disappointed in Father Pfleger's divisive, backward-looking rhetoric, which doesn't reflect the country I see or the desire of people across America to come together in common cause," Obama said in a statement.

Obam's reply to questions about domestic terrorist William Ayers:

STEPHANOPOULOS: A gentleman named William Ayers, he was part of the Weather Underground in the 1970s. They bombed the Pentagon, the Capitol and other buildings. He's never apologized for that.

And, in fact, on 9/11 he was quoted in The New York Times saying, "I don't regret setting bombs; I feel we didn't do enough." An early organizing meeting for your State Senate campaign was held at his house and your campaign has said you are "friendly."

Can you explain that relationship for the voters and explain to Democrats why it won't be a problem?

OBAMA: George, but this is an example of what I'm talking about. This is a guy who lives in my neighborhood, who's a professor of English in Chicago who I know and who I have not received some official endorsement from. He's not somebody who I exchange ideas from on a regular basis.

And the notion that somehow as a consequence of me knowing somebody who engaged in detestable acts 40 years ago, when I was 8 years old, somehow reflects on me and my values doesn't make much sense, George.

Along comes Governor Blagojevich.  Obama is saddened again, he didn't know:

"Like the rest of the people of Illinois I am saddened and sobered by the news that came out of the U.S. attorney's office today. But as this is an ongoing investigation involving the governor, I don't think it would be appropriate for me to comment on the issue at this time," Obama said — and then he said he wasn't aware of Blagojevich's maneuvering.

He wasn't aware.  All those years in Chicago he wasn't aware. 

Obama, Rezko, Jones, and Blagojevich:

Obama's circle of major Illinois political allies and supporters is largely separate from Blagojevich's, with two major exceptions. Both Obama and Blagojevich got extensive money and support from Chicago businessman Antoin "Tony" Rezko, who is now under federal indictment. And Obama is close to Illinois Senate President Emil Jones, who has been the governor's staunchest legislative ally.

Maybe Obama didn't hang with Blagojevich but he does have a "long-term" association with him:

Obama Advised Blagojevich On His Victorious Gubernatorial Run. “That year, [Obama] gained his first high-level experience in a statewide campaign when he advised the victorious gubernatorial candidate Rod Blagojevich, another politician with a funny name and a message of reform.” (Ryan Lizza, “Making It,” The New Yorker, 7/21/08)

* Obama: “If the governor asks me to work on his behalf, I’ll be happy to do it.” (John Patterson, “Senator Says He’s Still Willing To Help Blagojevich Despite Hiring Concerns,” Chicago Daily Herald, 7/27/06)

Obama Endorsed Blagojevich For A Second Term. “Obama, who endorsed Blagojevich for a second term nearly 18 months ago, said he’s ready to help Illinois democrats in the upcoming elections.” (John Patterson, “Senator Says He’s Still Willing To Help Blagojevich Despite Hiring Concerns,” Chicago Daily Herald, 7/27/06)

* Obama: “We’ve got a governor in Rod Blagojevich who has delivered consistently on behalf of the people of Illinois.” (Deanna Bellandi, “Illinois Democrats Talk Unity But Don’t Show It,” The Associated Press, 8/16/06)

And that pesky Tony Rezko just keeps popping up.  Rezko had "strong ties" with Blagojevich just as he had strong ties with Barack Obama.

Obama's relationship with Emil Jones is especially revealing:

Long before Barack Obama launched his campaign for the White House, when he was considering a run for the US Senate in 2003, he paid an intriguing visit to a former Chicago sewers inspector who had risen to become one of the most influential African-American politicians in Illinois.

“You have the power to elect a US senator,” Obama told Emil Jones, Democratic leader of the Illinois state senate. Jones looked at the ambitious young man smiling before him and asked, teasingly: “Do you know anybody I could make a US senator?”

According to Jones, Obama replied: “Me.” It was his first, audacious step in a spectacular rise from the murky political backwaters of Springfield, the Illinois capital.

The exchange also sealed an intimate personal and political relationship that is likely to attract intense scrutiny amid the furore over Obama’s links to some of Chicago’s most controversial political and religious power brokers.

Obama has often described Jones as a key political mentor whose patronage was crucial to his early success in a state long dominated by near-feudal party political machines. Jones, 71, describes himself as Obama’s “godfather” and once said: “He feels like a son to me.”

...

For almost a year Jones has used his position as leader of the state senate to block anticorruption legislation passed unanimously by the state’s lower house. He has also become embroiled in ethical controversies concerning his wife’s job and his stepson’s business.

...

At one point during Obama’s 2003 Senate campaign, Jones set out to woo two African-American politicians miffed by Obama’s presumption and ambition. One of them, Rickey “Hollywood” Hendon, a state senator, had scoffed that Obama was so ambitious he would run for “king of the world” if the position were vacant.

When Jones secured the two men’s support, Obama asked his mentor how he had pulled it off. “I made them an offer,” Jones said in mock-mafioso style. “And you don’t want to know.”

Jones is now at the centre of a long row over his attempt to block proposed laws cracking down on his state’s “pay-to-play” tradition – whereby companies hoping to win government contracts have to contribute to the campaign funds of officials.

Jones’s staff say he blocked the bill because he intends to produce something tougher. No proposals have appeared.

"You don't want to know".