Democratic Rep. Maxine Waters of California is notorious for her high-decibel rants against corporate executives and career exploitation of identity politics. Class warfare and racial division are her two-decade-long stock and trade. She would normally be first in line (and in front of the cameras) to lambaste the very kind of Porsche-driving, luxury beach house-partying bank officials who begged her for a government handout. If they were white, that is.
But the minority fat cats who lobbied her during the fall 2008 financial meltdown represented the black-owned OneUnited Bank. They were her longtime friends, donors and fundraisers. Her husband was an investor in one of the banks that merged into OneUnited. He later served on the company's board of directors. Both Woman of the People Waters and her hubby have owned six-figure sums of OneUnited stock at various times over the past six years. Mr. Waters remained a OneUnited stockholder at the time Rep. Waters went to bat for the company. However, that indelible conflict-of-interest odor didn't stop her from intervening to arrange a high-powered meeting between OneUnited and then-Treasury Secretary Hank Paulson and 20 of his minions, who engineered a special federal rescue of the teetering company behind closed doors.
The taxpayer price tag of this textbook case of cronyism of color? Twelve million dollars in TARP bank bailout cash.
On Monday night, the House Ethics Committee filed three charges against Waters for using her influence to gain special favors for a woefully mismanaged financial institution run by politically correct suits living high on the hog. In a nutshell: OneUnited, a "minority depository institution," was seeking a stealth government bailout after squandering nearly $52 million of its bank capital on Fannie Mae and Freddie Mac preferred stock.
After the federal bailout of those troubled financial behemoths, OneUnited's securities in the government-sponsored enterprises plunged to a value estimated at less than $5 million. OneUnited initially demanded $41 million from the feds in exchange for unloading the junk stock. Truth be told, the bank was already in dire straits before the feds put Fannie/Freddie into receivership. Regulators criticized its unsound lending practices and lavish executive benefits (including fancy sports cars and a $6.4 million Santa Monica, Calif., beach house).
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Only through Waters' direct intervention was OneUnited Bank able to secure an emergency meeting with Paulson and Treasury, according to the ethics probe. The Treasury Department said so itself. At the confab, Waters' pals purported to represent the 130-member "National Bankers Association." But records obtained by congressional investigators show that OneUnited Bank's legal counsel, vice president and president (the latter two are married to each other) spearheaded the meeting, directed its agenda and drafted the talking points/briefing material for Waters at her request -- so that she could "speak intelligently" about their demands.
On the Rev. Al Sharpton's national radio show on Tuesday afternoon, Waters played the persecuted champion of urban America to perfection. She claimed the meeting was arranged on behalf of all black banks in the country. Sympathizers are now framing the matter as a threat to "advocacy for black businesses" and whispering loudly about a "racial profiling" campaign against Waters, her embattled colleague Rep. Charlie Rangel and other ethically challenged members of the Congressional Black Caucus.
But congressional investigators concluded that "OneUnited's exclusive representation at the meeting" was the "cause for concern," not Waters' noble-sounding social justice agenda. Stonewalling by OneUnited top officials Robert Cooper and Kevin Cohee exacerbated the Office of Congressional Ethics' concern. As did fellow Democratic Rep. Barney Frank's ignored warning to Waters to "stay out of" the matter.
In her defense, Waters pooh-poohs the OneUnited Bank rescue as a pittance compared to the rest of the monstrous TARP bailout. She'd have a teensy bit more credibility on the fiscal responsibility front if she had opposed TARP from the start, instead of playing an instrumental role in throwing the Congressional Black Caucus' full support behind it.
As is usually the case in Washington, these alleged violations dwarf the wheeling and dealing Waters has continued to broker as an entrenched incumbent and senior member of the House Financial Services Committee. The so-called financial "reform" bill she helped shepherd is stuffed with color-coded mandates and favoritism. From "We Shall Overcome" to "Get Mine" -- ah, racial progress.
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