October 6th, 2008
10:15 AM ET
10 years ago

Obama camp raises McCain’s ties to Charles Keating

The Obama camp is highlighting McCain's ties to Charles Keating.

The Obama camp is highlighting McCain's ties to Charles Keating.

(CNN) - After months of avoiding references to the decades-old “Keating Five” scandal that nearly derailed John McCain’s political career, Barack Obama’s campaign is highlighting the Republican presidential nominee’s ties to Charles Keating, an Arizona businessman who went to prison during the aftermath of the savings and loan crisis of the 1980s.

The campaign is releasing a new 13-minute “documentary” about the scandal, and sending a message to supporters that ties McCain to the federal bailout that followed.

A preview of the new Web video, "Keating Economics: John McCain and the Making of a Financial Crisis," shows clips of McCain's hearings before the Senate Ethics Committee two decades ago, as the narrator says "the Keating Five involved all the things that have brought the modern crisis” and that McCain "has not learned the lessons and has continued to follow policies that are going to produce a disaster."

Watch: 'Keating 5' dogs McCain

McCain was one of five senators, dubbed the "Keating Five," who met with regulators on behalf of Charles Keating, the owner of Lincoln Savings and Loan.

Listen: McCain aides fight back over Keating on a campaign conference call

In a message to supporters Sunday, Obama campaign manager David Plouffe tied McCain to the lack of oversight that led to the savings and loan crisis of that era, and the massive federal bailout package that resulted. "During the savings and loan crisis of the late '80s and early '90s, McCain's political favors and aggressive support for deregulation put him at the center of the fall of Lincoln Savings and Loan," Plouffe writes. "More than 23,000 investors lost their savings. Overall, the savings and loan crisis required the federal government to bail out the savings of hundreds of thousands of families and ultimately cost American taxpayers $124 billion."

The Obama campaign had largely avoided mentioning the disgraced Arizona financier for most of the year. After an Obama backer referenced the Keating Five scandal this spring, the campaign appeared to distance itself from the comment — but Obama signaled it might be fair game later in the year: "I was just asked previously about a whole host of associations that are a lot more flimsy than John McCain’s relationship to Keating Five," he told reporters.

Two weeks ago, as controversy over deregulation and financial oversight began to dominate the public consciousness and the McCain campaign started to step up its attacks over Obama’s associations with controversial Chicago figures, Obama spokesman Bill Burton raised the issue for the first time since May. The McCain camp had accused the New York Times of supporting Obama's presidential bid; Burton responded by sending reporters a list of investigative stories the paper had run about the Illinois senator, complaining that McCain’s relationship with Keating had not come up for similar scrutiny over the course of the campaign.

The Senate Ethics Committee investigated and cleared McCain in 1991, but said that he showed poor judgment in his efforts for Keating, who had been a major contributor to his campaign. McCain later turned over $112,000 in campaign contributions from Keating to the U.S. Treasury.
The documentary will be released online at noon.

The move comes two days after Gov. Sarah Palin accused Obama of "palling around with terrorists who target their own country" because he was supported by Bill Ayers, a founding member of the Weather Underground.

Responding to the new attacks over McCain’s history with Keating, the GOP nominee’s spokesman Brian Rogers raised those links again.

"John McCain has been open and honest about the Keating matter, and even the Democratic special counsel in charge recommended that Senator McCain be completely exonerated,” said Rogers. “By contrast, Barack Obama has been fundamentally dishonest about his friendship and work with the unrepentant terrorist William Ayers, whose radical group bombed the Pentagon and the U.S. Capitol. Nor has Barack Obama come clean on his close friendship with Tony Rezko, a felon convicted on bribery charges who subsidized the purchase of Barack Obama's home. It's obvious that Barack Obama is frantically attacking because he knows that most voters find these kinds of friendships, and the failed judgment they expose, to be unacceptable for our next president."

Filed under: Candidate Barack Obama • John McCain
soundoff (188 Responses)
  1. becky in Ohio

    Yes, it WAS McCain who continued to cry "deregulation" even after his mistakes were made in the "Keating 5". He and Cindy spent plenty of time vacationing with Keating while hard working Americans lost their entire life's savings.
    SHAME on you McCain!

    October 6, 2008 10:28 am at 10:28 am |
  2. Ken in Dallas

    Rogers neglected to mention that the ethical review of the Keating Five scandal concluded that McCain had exercised "remarkably poor judgment," or that Keating provided the core funding for McCain's original campaign for Congress. None of these things are central issues, however.

    The real point at issue in this election is that the Republican party's experiment with the resurrection of laissez-faire economics has failed in very much the same way as the 19th century laissez-faire period ended, in rampant corruption and economic collapse. "Supply-side," or "trickle-down" economic theory, which the Republican party has enshrined as party doctrine, has been exposed as nothing more than a rebranding of laissez-faire, and the current state of the economy stands as proof that the rebranding of laissez-faire isn't enough to make it workable.

    The Republican party is committed to an economic doctrine that is guaranteed to lead to bankruptcy. It has never been more clear that a vote for the Republican ticket is a vote against the interests of American citizens.

    October 6, 2008 10:29 am at 10:29 am |
  3. Get Real

    McCain's Own Radical Ties....
    G.Gordon Liddy –
    McCain served on boards with him, considers him a 'friend'

    landed Liddy a four-year jail sentence.

    But Liddy's career of inflammatory statements and actions exceed his Watergate actions.

    Liddy, advising Branch Davidians how to defend themselves from ATF agents during a radio show:

    "If the Bureau of Alcohol, Tobacco and Firearms insists upon a firefight, give them a firefight. Just remember, they're wearing flak jackets and you're better off shooting for the head."

    Liddy, on the impact Adolf Hitler had on him as a child:

    When he listened to Hitler on the radio, it "made me feel a strength inside I had never known before," he explains. "Hitler's sheer animal confidence and power of will [entranced me]. He sent an electric current through my body."

    Watch Out McCain – You have a few more skelatons that can be exposed!

    October 6, 2008 10:29 am at 10:29 am |

    none-issue obama is so pathetic could not come up whit something better then this. Remember everyone cant be accused of any crime . You are not guilty until proven. and McCain was found NOT GUILTY. Can obama prove that is terrorist ties are not real? I prefer some one not guilty of a crime then someone who is a friend of terrorist..

    October 6, 2008 10:30 am at 10:30 am |
  5. BM

    They keep talking about experience. Bush had experience, but look where we are as a nation. McCain may have experience and that is worse, because he knows how to abuse the system after the Keating Five scandal.

    October 6, 2008 10:30 am at 10:30 am |
  6. I can see Russia

    Hey Combat Vet

    You should be more concerned over McCains total TOTAL LACK OF SUPPORT for Veterans. He uses his POW history to rally the troops and then votes against every dime needed by Vets!

    October 6, 2008 10:30 am at 10:30 am |
  7. Brian

    McCain was young when this occurred........ we need to stop looking at the past and look to solutions for the future...... what matters is that Obama went the house of a person that was 1970's terrorist (but never convicted) in the mid 90's.

    October 6, 2008 10:30 am at 10:30 am |
  8. Al, NY NY

    To Tony and Female Voter: Tony...none of those democrats are running for POTUS genious. To Female Voter...so what? Obama never took funds from Ayers, he only met with him, years ago. Don't try to picka nd choose your details lady. Your old man and the lipstick Fido are going nowhere in November. They can smear and distort all they want. Since they have no new ideas of their own to provide, it's the typical Rovian/Atwater plan... It worked before (on McCain in 80) but not this time. Too many people now know the 8 years of agony the current idiot in chief has subjected us to, and JM/Fido are just going to continue them

    October 6, 2008 10:30 am at 10:30 am |
  9. joe london

    Mccain started this dirty smears....HIS going DOWN,wake AMERICA..wake up, 8 years of economic disaster,weak dollar,
    highest forclosure ever,thousands of recorded jobs lost..republican shoud'nt be anywhere near the white house for next 3 decades..
    with john mccain your country would totally disappear like a vapor,
    WAKE UP..........think about the future of your children and grand children...America deserve better than than this pain She's going thru.

    October 6, 2008 10:30 am at 10:30 am |
  10. Tony





    October 6, 2008 10:30 am at 10:30 am |
  11. dian

    Shame on you, John McCain!

    October 6, 2008 10:30 am at 10:30 am |
  12. insanity

    Try 2
    it's funny how the McCain campaign is trying to wiggle out of the same dirt they're throwing out.
    The fact is, relationship with Ayres is really a non issue unless you suggest that Obama's judgment is flawed for having any form of contact with Ayres.. I find that stupid, but let's use the same standard to McCain.
    Applying that standard to McCain, you can prove that McCain's judgment is even more flawed for accepting favors from Keating, and also not having the judgment to discern between good and bad actions.

    I say McCain's judgment is downright dangerous

    October 6, 2008 10:30 am at 10:30 am |
  13. Bitter in Texas

    Well folks..... it ain't just the Keeting Five that we should be worrying about...McGimmic's son was a member of the Board of Directos of Silver State Bank...ya know...the one that just failed recently. Like father, kike son....do you all want McGimmic anywhere close to our money??? I don't!!!!!

    October 6, 2008 10:31 am at 10:31 am |
1 2 3 4 5 6 7 8