By Thomas F. Roeser
Will Gov. Blagojevich be indicted? Let’s say that a cursory study of grand jury corruption probes from all 50 states…including those when the U.S. consisted of 48…shows that there has never been an occasion when so many allegations and testimony before federal juries has failed to yield an indictment of a major figure whose name has been so prominently mentioned. That doesn’t mean this couldn’t be the first time—but knowledgeable people say not for attribution that if Blagojevich isn’t nailed, it will be an historic first.
One deciding factor seems to be testimony last week at the Rezko trial by Clyde Robinson, director of investor relations at JER Partners, a private equity, real estate investment management company headquartered in McLean, Virginia which manages private equity real estate funds with clients totaling more than 100 institutional investors including some of the world’s largest public and private pension funds, endowments and financial institutions. The testimony didn’t involve Tony Rezko but it showed jurors the twists and turns that allegedly took place as political consultants pocket rich “fees” for doing nothing which are in many cases back-channeled into political contributions for Blagojevich.
Robinson said he was in a private meeting with Deborah Harmon, a principal of the firm in May, 2004. JER had bid for a $80 million investment package from the state, part of a total $40 billion Teachers’ Retirement System of Illinois. In the midst of their meeting, a secretary interrupted them saying that a man was on the phone who threatened to have her fired if she didn’t put the call through. Robinson and Harmon looked at themselves questioningly and Robinson took the call.
Robinson asked the caller “can you tell us who you are?” The caller then purportedly identified himself as Joe Cari, a onetime fund-raiser for the Democratic National Committee purportedly representing Gov. Blagojevich.
Cari urged Robinson and Harmon to immediately sign a contract with the state of Illinois that would steer a $750,000 finder’s fee to someone living in the Turks and Calcos islands of the Caribbean—a country composed of 8 major islands and many cays located 575 miles south of Miami. If not, the JER proposal would be “yanked from the agenda.” He said Cari explained, “I’m very close with the governor. This is how the governor handles patronage.”
When assistant U. S. Attorney Carrie Hamilton asked Robinson to clarify whom the caller was professing to represent, Robinson said: “The governor of the state of Illinois.” While the deal didn’t go through, the feds say that the source in the Caribbean was involved with Stuart Levine, a close Rezko associate and member of two state boards. Prosecutors allege that Rezko, 52, of Wilmette was the key figure behind the negotiations that required investment firms to pay kickbacks in order to win state business. Cari testified that Levine, the prosecution’s star witness, not only exerted great pressure on him but was “menacing” because JER hadn’t signed the consulting contract.
Many experts I have talked with say that a Blagojevich indictment can be expected. One who has said so on the record is Charles Wheeler, the highly regarded director of the public affairs reporting program at the University of Illinois-Springfield and a former “Sun-Times” Springfield bureau chief. If Blagojevich is indicted, the question arises as to whether he would resign in order to devote his full time to his defense—or continue in his post. A unanimous nose-count of the people I have talked with say that he would remain as governor. Only a conviction would remove him from office and it is likely, in their estimation, that this would happen given the thoroughly meticulous way U. S. Attorney Patrick Fitzgerald conducts a prosecution. If an indictment follows—as is expected—a trial of the governor could take place as early as this fall. Given that it may well not last as long as the trial of former Gov. George Ryan, Blagojevich could be found guilty pending future appeals in the early part of 2010, leading to the elevation to the post of Lt. Governor Pat Quinn.
It could mean that leading up to the next gubernatorial election of 2010 Quinn would be the new governor. It should be expected that Quinn would promptly announce he would run for election. While he has been a critic of the governor and led a drive to add recall to the state constitution, he has pursued a rocky road with Democrats of all stripes, from becoming engaged in a bitter battle as Harold Washington’s director of revenue, earning the enmity of many liberals for designing the disastrous “reform” of the legislature via referendum that has led to the dominance of the Big Four leadership which has turned the remaining lawmakers into virtual mushrooms—kept in the dark while major negotiations are going on. In a very real sense, the logjam between Speaker Madigan, the governor and Senate President Jones is a legacy of the misconceived Pat Quinn “reform.” To the minds of many, Illinois’ unique three-member districts worked well. Quinn’s demagoguery which ended it did not serve Illinois well.
For many reasons the electorate might be so weary of the fiery controversies surrounding the Democrats in the state that the electorate could well consider electing a Republican.
Who would that Republican be? At least one candidate who ran before is beginning to surface, State Sen. Bill Brady of Bloomington. A knowledgeable lawmaker with a contagiously friendly mien, Brady, who is not a man of wealth, failed to raise significant funds to give his campaign a thrust in 2006. Another notable candidate is State Rep. Tom Cross, the Republican House leader who has impressed many with his savvy and ability to work with both sides. Pro-life lawmakers who work under his direction tell me he is fair and equitable to all sides, which is what I have observed in my dealing with him and his superb staff. Whether he wishes to run for governor or will stay with the house where he might well have the opportunity to be Speaker, is unknown. But neither Brady nor Cross are men of wealth and would have to depend on raking in the contributed dollar in large measure which occupies so much time and detracts from the stupendous job at hand of solving the state’s horrific problems. .
Many observers say that were the Republican party astute—which it is not—it would settle on a nominee without an internecine primary: a nominee with extensive personal wealth who would be able to fund much of his own campaign without engaging in demeaning deal-making and quid-pro-quos that accompanies so much money-raising where average Illinois politicians are concerned.
One such person would be the current treasury secretary, Henry (Hank) Paulson, a former CEO of Goldman-Sachs who is worth in conservative estimate at least $600 million, approximately as much as Mitt Romney. But the controversial bail-out of Bear Stearns by Paulson and the Fed would be a definite drawback in the election, leading to the question as to whether mercantilism has not dominated his economic thinking.
Another prospect would be Ron Gidwitz of Chicago who ran a thoroughly cerebral campaign for the Republican nomination in 2006, losing to State Treasurer Judy Baar Topinka. Gidwitz took the Helene Curtis company then a local cosmetics concern and built it into a formidable empire. He matched his entrepreneurial acumen with solid civic and political leadership, having served as chairman of the state board of education where he demanded bureaucrats visit Illinois classrooms to see how their policies were working or not working. He was also chairman of the City Colleges of Chicago. For these reasons he was endorsed for the GOP nomination by the “Chicago Tribune.”
A supposed negative used against him in the last Republican go-round was that he is abrasive and doesn’t suffer fools gladly. That could be a definite plus at this late stage in Illinois where glad-handing and back-slapping, got the state to the sorry condition it is in now. The problems facing Illinois are stupendous—requiring one who can say “no” and who will be able to take the heat for decisions which though unpopular are necessary. I interviewed Gidwitz on my radio program last night. He is not leaping into the fray, is cautious and prudent and as a leader of generally moderate and libertarian philosophy can easily adapt to becoming a stable and conciliatory force to unite the party’s often violently quarrelsome internecine factions.
As one who has known him for decades and who worked with him when he was chairman of the City Club of Chicago and I its president, I respect him as an outstanding leader. Social conservatives should recognize that in him you have one who opposes public funding for abortion while supporting pro-choice as a personal view and one who does not espouse special “rights” for special groups that inhabit the liberal community, is sound on the 2nd amendment, is a proponent of vouchers in education.
In fact where he might have disagreements with the social conservatives—passage of a federal right-to-life amendment—is negligible since not even the strongest pro-life proponent (and I consider myself to deserve listing in that category) can allege the country is on the verge of taking that step. Besides which an Illinois governor facing such huge solvency problems will be glad not to be involved in something that would come down the pike decades in the future.
The purpose of this article is not to endorse—particularly where no candidates have emerged who say flatly they will run. And, for the benefit of disclosure, Gidwitz has invested in The Chicago Daily Observer but he is not the predominant investor. When an average working stiff like me joined with my colleague John Powers can top Ron in investing in this enterprise, rest assured editorial objectivity is not impaired.
But he and others will have to make their decisions but please God somebody with acumen and courage do something. The state’s continuing massive pension debt stands at $42 billion. A 1995 law requires the state to contribute $725 million more next year than the $2.1 billion contribution of this year. There is a $500 million increase in Medicaid liability. Item by item the problems are staggering. Repairs and maintenance for the Department of Corrections’ automobile fleet must be cleared through its top command since the department owes $2 million to the state agency that services vehicles—and doesn’t have the funds to pay repair bills.
Only half the 80 beds in the addition to the LaSalle Veterans Home is available to vets requiring nursing care because Illinois doesn’t have the $3 million needed to staff all the new beds—while at the same time 500 eligible veterans are on the waiting lists.
I firmly believe the state needs as Governor a Republican who can transcend the fighting of the Democrats—a governor who won’t be bogged down in his own fund-raising problems. Whoever it is should get on his horse soon.
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