Confirmed: “Drain the swamp” is Washington-speak for “Let it fester.” While House ethics watchdogs dither, it’s shady business as usual for the ethics scandal–plagued Rep. Maxine Waters (D., Calif.).
Last summer, the House Ethics Committee charged the entrenched California congresswoman with three violations related to her wheeling and dealing on behalf of minority-owned OneUnited Bank in Los Angeles. The panel accused Waters of bringing discredit to the House for using her influence to seek and secure taxpayer-subsidized special favors for the failing financial institution.
Eight months have passed since the House ethics panel charged Waters. But to date, there has been no action. No trial. No consequences.
Instead, Waters is busy ginning up opposition to GOP budget and entitlement reform, introducing new regulatory crackdowns on the financial industry, and waltzing into political rallies as Aretha Franklin’s “Respect” blares from the loudspeaker. The Swamp Queen has been playing her well-worn race card, stoking class warfare in the “community” and playing populist guardian of the “children, the poor, the disabled, and the elderly.”
Mad Maxine may have her “community” duped. But this corporate-welfare fixer is just another corruptocrat of a different stripe.
To recap: OneUnited Bank received $12 million in TARP bailout money after Waters’s office personally intervened and lobbied the Treasury Department in 2008. The minority depository institution was seeking a backdoor government rescue from its reckless decision to squander nearly $52 million of its bank capital on Fannie Mae and Freddie Mac preferred stock. Lavish spending by top bank executive Kevin Cohee, who boasted a company-financed Porsche and a Santa Monica, Calif., beachfront mansion, compounded the bank’s problems.
After the federal bailout of Fannie and Freddie, OneUnited’s stock in the government-sponsored enterprises plunged to a value estimated at less than $5 million. Only through Waters’s intervention was OneUnited able to secure an emergency meeting with the Treasury and then-secretary Henry Paulson.
The bailout beggars did so under the guise of representing the “National Bankers Association.” But records obtained by congressional investigators showed that OneUnited’s legal counsel, vice president, and president (the latter two are married to each other) spearheaded the meeting and its agenda and drafted the talking points and briefing material for Waters.
OneUnited executives had donated $12,500 to Waters’s congressional campaigns. Her husband, Sidney Williams, was an investor in one of the banks that merged into OneUnited. His stock holdings were estimated at $350,000. Waters meddled despite warnings from fellow representative Barney Frank (D., Mass.) to keep her nose out of the case.
E-mails obtained by public-interest legal foundation Judicial Watch and more recently by the Washington Post reveal that federal bank examiners were livid about the intervention of muddied Waters. “There are some really good people expressing very strong opinions regarding what they view as a travesty of justice regarding the special treatment” OneUnited is receiving, acting regional director John M. Lane complained in a March 2009 e-mail to Christopher J. Spoth, a senior FDIC consumer-protection official.
On Jan. 13, 2009, Brookly McLaughlin, at the time the Treasury Department deputy assistant secretary for public affairs, e-mailed her shock at Waters’s apparent conflict of interest regarding OneUnited: “Further to email below, WSJ [Wall Street Journal] tells me: . . . Apparently this bank is the only one that has gotten money through section 103-6 of the EESA law. And Maxine Waters’ husband is on the board of the bank. ??????”
Another government agency had rapped the bank in October 2008 for “operating without effective underwriting standards and practices,” “operating without an effective loan documentation program,” and “engaging in speculative investment practices.”
Tom Fitton, Judicial Watch president, reports that Waters’s friend and fellow California Democrat, Rep. Zoe Lofgren, helped delay Waters’s ethics trial by stalling subpoenas, “doing everything in her power to undermine the professional committee staff leading the investigation,” and improperly firing two attorneys working on the investigation. Now, the GOP is mum on setting a date for the trial. Why?
This much is clear: Mad Maxine Waters’s cronyism of color can’t be whitewashed, no matter how long Washington stalls.
— Michelle Malkin is the author of Culture of Corruption: Obama and His Team of Tax Cheats, Crooks & Cronies (Regnery, 2010). © 2011 Creators Syndicate, Inc.