Op-Ed: Obama Veep Advisor Jim Johnson Thrown Under The Campaign Bus

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Jim Johnson, a senior advisor for the Barack Obama campaign, has resigned from Obama's Veep vetting team and can now join the not-so-distinguished Obama Campaign Bus Tire Track Club.

Seems Mr. Johnson was caught up in some very dirty politics regarding the recent loan mortgage crisis.

Perhaps Obama would be better served vetting his own campaign before he brings in any more outsiders.

Some background from the Wall Street Journal:

Barack Obama may have come up with a creative way to solve the housing recession: Let everyone buy property at a discount the way he did from Tony Rezko, and give everyone in America a discount mortgage the way Angelo Mozilo of Countrywide did for Fannie Mae's Jim Johnson.

Team Obama's real estate and mortgage transactions are certainly a change from business as usual. They suggest old-fashioned back-scratching below even current Beltway standards.

A former CEO of mortgage financing giant Fannie Mae, Mr. Johnson is now vetting Vice Presidential candidates for Mr. Obama. But he is also a textbook case for poor disclosure as regulators sifted through the wreckage of Fannie's $10 billion accounting scandal.

Despite an exhaustive federal inquiry, Mr. Johnson managed to avoid disclosing one very special perk: below-market interest-rate mortgages from Countrywide Financial, arranged by Countrywide CEO Angelo Mozilo. Journal reporters Glenn Simpson and James Hagerty broke the story this weekend.

Fannie Mae tells us that Mr. Johnson did not inform the company's board of these sweetheart mortgage deals, nor did his CEO successor Franklin Raines, who also received such loans.

We can understand why. Fannie bought mortgages from loan originator Countrywide, and then packaged them into securities for sale or kept the loans and profited from the interest. Mr. Mozilo told Dow Jones in 1995 that he was "working very closely . . . with Jim Johnson of Fannie Mae to come up with a rational method of making the process more efficient by the use of credit scoring."

Since Fannie was buying Countrywide's loans, under terms set by Mr. Johnson and later Mr. Raines – or by people in their employ – the fact that Fannie's CEO had a separate personal financial relationship with Countrywide was an obvious conflict of interest. The company's code of conduct required prior approval of such arrangements. Neither Mr. Johnson nor Mr. Raines sought such approval, according to Fannie.

Mr. Johnson now joins Samantha Power, Robert Malley (who was caught having talks with Hamas), Tony Rezko and Jeremiah Wright as Obama's sacrificial lambs.

More to come, no doubt.

I expect unrepentant Weather Underground bombers William Ayers and Bernardine Dohrn to have tire tracks all across their backs long before the general election.

These continuing scandals can only help John McCain, but it begs a larger question.

If Obama's judgment can't be trusted on whom he vets and selects as his advisers and 'mentors', how can he be trusted with vetting and selecting the top appointees in government?

And at this pace, how many advisers will he have left come November?