The facts Sen. Obama cited about Bill Ayers are true. The Chicago Annenberg Challenge (CAC) was a $50 million dollar effort to reform Chicago's beleaguered public schools, funded by Walter Annenberg, a close friend of Presidents Nixon and Reagan, who was Nixon's ambassador to Britain. Bill Ayers, a respected professor of education at the University of Illinois -- Chicago, was one of three school reform advocates who crafted the Chicago grant proposal, in an effort to tap into Annenberg's $500 million nationwide school reform effort.
Obama served chaired the board of the CAC from 1995 to 1999. Ayers was one of dozens of informal advisors to the CAC board from the Chicago school reform community. He served alongside conservative members of Chicago's civic and business community, who were firmly behind this school reform effort, as was then IL Gov. Jim Edgar, a Republican, and GOP members of the state legislature. Tired of Chicago school officials and union leaders coming to the state capitol with their hands out for more money, the Republicans in fact were demanding radical reforms in Chicago Public Schools, like what was taking place under the Annenberg Challenge.
Furthermore, no Republicans in Chicago and Illinois raised any concerns about Ayers, his background, nor his involvement in the city's schools. In fact, even today, none of the outrage over Obama's ties to Ayers is coming from Republicans in Chicago or Illinois.
As for the allegation that Obama "launched his political career in Ayers' living room," Ayers did host in fall of 1995 a 'getting-to-know-you" coffee at his house, as Obama was preparing to run for the Illinois Senate. The event was organized by to introduce Obama to supporters of the incumbent state Sen. Alice Palmer, who had announced she would run for congress (she later changed her mind and Obama beat her in the primary). It was one of several such coffees held that day and week. It was not the launch of his campaign; it was not a fundraiser.