While the McCain campaign continues its attack on Barack Obama for his contacts with the 1960s radical Bill Ayers, the Obama camp has shot back: On Monday, it unveiled a 13-minute Web documentary that highlights John McCain's role in the savings and loan crisis of the late 1980s.
Today, McCain is the Republican nominee for president, but in 1991, he was a first-term senator facing the Senate Ethics Committee on Capitol Hill. He was in a scandal that could have ended his political career.
McCain was a member of the Keating Five, a group of senators who had pressured federal regulators on behalf of well-connected savings and loan financier Charles Keating. The Obama campaign video is narrated by William Black, one of the regulators who investigated the case, and it retraces the history of McCain's involvement in the savings and loan scandal.
"Senator McCain knew the facts, because we had briefed him. He knew this was a criminal enterprise," Black said in the documentary.
On Monday afternoon, William Dowd, McCain's attorney, flatly dismissed the attack. "It's sort of a classic political smear job on John," Dowd said.
McCain's Ties To Keating
During the ethics committee's investigation into the Keating Five, McCain testified that Keating's campaign contributions over the years did not influence him.
"People who live in your state will contribute to your campaign," McCain said in his testimony. "Those people also may need help from time to time and may need your 'intervention.' The key to it is, obviously, to intervene in a proper fashion."
Keating was more than a constituent. He had flown McCain and his family on vacations to the Bahamas. McCain's wife, Cindy, had invested in real estate with Keating.
But with the deregulated savings and loan industry crashing from too many bad investments, and federal regulators going after Keating's savings and loan empire, Keating needed help.
Asked if his campaign money would win friends on Capitol Hill, he said, "I certainly hope so."
The Keating Five met with regulators who, indeed, felt pressured. But McCain did less than some of the other senators investigated.
Washington lawyer Robert Bennett was special counsel to the ethics committee. He wanted McCain dropped from the case. But he says Democrats insisted that McCain, as the only Republican, stay in the docket.
"I'm a Democrat, but I nevertheless found that objectionable," he said.
In the end, the committee criticized McCain's "poor judgment." And he has often expressed remorse.
On the campaign trail in 1999, for example, McCain said, "I could argue with you 'til I'm blue in the face that I did nothing wrong in the Keating affair, which might be technically true. But I know that I did wrong by attending that meeting with four other senators and a group of regulators." It's a more self-critical view than his campaign now admits.
McCain fared better than most of the others in the Keating Five. Sen. John Glenn of Ohio was chastised, like McCain, and resumed his Senate career. But Dennis DeConcini of Arizona and Don Riegle of Michigan, who were chastised, declined to seek re-election when their terms ended. And Alan Cranston of California, who was reprimanded, retired in 1991.
Obama Attacking Keating Affair
Bennett, whom McCain hired to represent him when The New York Times alleged last year that he had done favors for a lobbyist, says the Keating Five case does not belong in the presidential race.
"I don't think it's a basis for calling into question Senator McCain's ability to be president, any more than I think that Sarah Palin's assertions regarding the relationship with Mr. Ayers, who did some things when Senator Obama was 8 years old — I don't think that's a basis, either," he said.
But the Obama campaign says this isn't about the past. The video frames the Keating Five case as a symptom of deregulation, just like the current crisis on Wall Street.
And it paints McCain as someone who helped out a constituent, Charles Keating, while — just like today — taxpayers got stuck with the bill.
Maybe it is a more nuanced approach than what's coming from McCain's campaign, but ultimately, just as sharp-edged.