Sen. Kent Conrad is currently enduring one of the most prominent scandals in decades to hit a North Dakota elected official. It is noteworthy because this isn’t Chicago, New York or Peoria IL. It is North Dakota and we expect more from our politicians. As Chairman of North Dakota’s Republican Party, I would respectfully suggest that Conrad’s problems won’t be resolved until he can answer at least the four following questions.
- Why the shifting explanations? Conrad has had at least three variations of his story detailing his relationship with the head of Countrywide Financial. Initially, Conrad claimed total innocence. He said he got a mortgage like everybody else. He said he didn’t know the CEO, didn’t ask for special favors and didn’t know he got a sweetheart deal. Later, he changed his story and said he actually did call the CEO to ask for a mortgage, but didn’t specifically ask for special favors. Now he says he didn’t really call the CEO at all, he was just talking to a friend on the phone about mortgages, and his friend merely happened to be standing next to the CEO, so his friend handed the phone over. Setting aside the rather all-too-convenient sounding nature of his latest story, North Dakotans still deserve to know why his explanations have had so many evolutions.
- Why the extraordinary Senate help in bailing out Countrywide? Conrad is the Chairman of the Senate Budget Committee. In order to facilitate the bailout the unethical lenders and speculators that caused the mortgage crisis, Senate Banking Committee Chairman Chris Dodd (D-CT) needed Conrad to agree to waive budget rules to help the massive handout move forward. Conrad and Dodd are the two Senators at the center of the VIP mortgage scandal. It is a strange coincidence, and Conrad needs to explain exactly why he supports the budget-busting taxpayer bailout of one of the very companies from which he secured a sweetheart deal. His active support of the bailout is especially troubling considering North Dakota has the lowest mortgage default rate in the country. Consequently, North Dakotans will disproportionately shoulder the burden of bailing out reckless real estate speculators elsewhere. It is a huge wealth transfer from our state to other parts of the nation. At the very least, Conrad should consider abstaining from participating in the legislation given the appearance of impropriety.
- Why not use a North Dakota lender? If, as Conrad claims, he really didn’t get a better deal with Countrywide than anywhere else, it is mystifying why he wouldn’t use a North Dakota lender for the Bismarck apartment complex. We have to assume Conrad is smart enough to shop around for mortgages. If the Countrywide deal was only equal to what he could have gotten anywhere, then why not patronize North Dakota businesses? A very rational explanation is that having been referred to and spoken with the Countrywide CEO for his million-dollar beach house, Conrad implicitly knew he was getting awfully good deals. Reports have indicated that the VIP program was common knowledge among Washington insiders, so Conrad appears to be portraying himself as willfully blind to the conflict of interest.
- How does the Senate’s self-proclaimed “numbers guy” not know the most basic facts about his own mortgage? Conrad has spent years selling the notion he knows more about finance and budgets than just about anyone else on the planet. Yet when it comes to his own finances he takes the “ostrich defense.” His ignorance of his personal finances is worth remembering the next time he brings out his charts proclaiming higher taxes and more government spending as the path to economic prosperity.
Conrad is learning the hard way what so many fallen politicians before him have discovered. When you are caught red-handed, it is best to fess-up completely the first time, and then humbly ask for forgiveness. To date he has done neither. He has earned the admonishment of nearly every major editorial page in North Dakota. National newspapers as diverse as the Washington Post, the Wall Street Journal and the USA Today have been even more harsh in their rebukes. Conrad has likely seen his dream of becoming US Treasury Secretary dashed because of his serious error in judgment. If he isn’t more forthcoming he may eventually see his Senate career ending as well, even if we have to wait until 2012 to get it done.