Culture of Corruption: Obama and His Team of Tax Cheats, Crooks, and Cronies (13 page)

The Chicago team, in other words, was beaten for once by their own games.
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MRS. O. SCREWS THE POOR

Speaking of uncanny timing: it is no coincidence that Mrs. Obama found herself named to another University of Chicago Medical Center post—Executive Director of Community Affairs—the year her friend and mentor Valerie Jarrett became vice-chair of the medical center’s board of trustees.

Nor is it a coincidence that Mrs. Obama found herself promoted in 2005 after her husband won his U.S. Senate race with Jarrett’s invaluable aid. As “vice president for community and external affairs” and head of the “business diversity program,” her annual compensation nearly tripled from $122,000 in 2004 to $317,000 in 2005 .
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Even after she went on leave in 2007 to help her husband campaign, the hospital paid Mrs. Obama $62,709 in 2008,
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prompting one skeptic to ask: “We know this is Chicago, but isn’t $63,000 quite a lot for a no-show job?”
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Hospital officials asserted that Mrs. Obama was “worth her weight in gold,”
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singling out her special relationship with—and her “new level of compassion”
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for—the city’s poor. But it was undoubtedly her relationships with her husband and political godmother that held far greater value.

“[S]he just has a way about her, a real kindness,” gushed the hospital’s general counsel, Susan Sher.
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But Sher was no disinterested observer. Her personal friendship with Mrs. Obama began years ago when the women worked together at Chicago City Hall; Sher headed up Mayor Daley’s legal department when Michelle O. came on board.
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In January 2009, Sher was tapped to serve as White House associate counsel .
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(Like dozens of other high-ranking Obama officials, Sher used to be a registered lobbyist. Never mind Obama’s promise that lobbyists would have no place in his White House.)

The high-paying “community affairs” post was another make-work job no one else at the university needed to do until Michelle Obama came along. And it was a job no one else needed to fill after she left. In January 2009, Mrs. Obama’s indispensable job was eliminated as part of a massive restructuring to cut annual budget costs by 7 percent.
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Naturally, Mrs. Obama’s remnant duties were taken over by another old pal—Dr. Eric Whitaker, vice president at the University of Chicago Medical Center and an Obama basketball buddy from their Harvard grad student days.
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Whitaker previously served as director of the Illinois Department of Public Health. Obama enthusiastically recommended him for that job. And, mother of all coincidences, you’ll never guess to whom Obama made the recommendation:

. . . Obama, then an Illinois state senator, gave a “glowing” reference for Whitaker to Tony Rezko, the now-convicted political fixer who helped Gov. Blagojevich find people to run state agencies. Blagojevich hired Whitaker to be the state’s public health director.

Obama has said that’s the only time he can recall talking to Rezko—who was a major campaign fund-raiser for him and for Blagojevich—about getting anyone a state job.

“Somebody who I do remember talking directly to Tony about was Dr. Eric Whitaker,” Obama told the
Sun-Times
in March. “He and I played basketball together when he was getting his master’s in public health at Harvard, while I was in law school there. He had expressed an interest in that job. I did contact Tony, or Tony contacted me, and I gave him a glowing recommendation because I thought he was outstanding.”
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“Outstanding?” Well, his ability to escape scrutiny and accountability for his sleazy ties to Rezko certainly is outstanding. Rezko pulled the strings at the Illinois Health Facilities Planning Board overseeing medical construction projects. Dr. Whitaker sat as the stooge-in-charge of the board’s budget. Rezko and his cronies controlled the board, “which they used to solicit kickbacks and payoffs, according to testimony at Rezko’s trial,” the
Chicago Tribune
reported. Rezko is in jail. Whitaker remains the Obamas’ close confidante.

Crony out, crony in.

Unfortunately for many of Chicago’s poor, Mrs. Obama didn’t depart until after she helped engineer a rather un-progressive and unkind plan to dump low-income patients with non-urgent complaints from the medical center. Like the unfortunate residents of Valerie Jarrett’s slums, the unfortunate patients at Michelle Obama’s University of Chicago Medical Center got to see the real meaning of Chicago liberal compassion. Under the Orwellian banner of an “Urban Health Initiative,” Mrs. Obama sold the scheme to outsource low-income care to other facilities as a way to “dramatically improve health care for thousands of South Side residents.” The program guaranteed “free” shuttle rides to and from the outside clinics. It was old-fashioned cost-cutting and favor-trading repackaged as minority aid. Clearing out the poor freed up room for insured (i.e., more lucrative) patients. If a Republican had proposed the very same program and recruited black civic leaders to front it, Michelle Obama and her grievance-mongering friends would be screaming “RAAAAAAAAACISM!” at the top of their lungs:

To ensure community support, Michelle Obama and others in late 2006 recommended that the hospital hire the firm of David Axelrod, who a few months later became the chief strategist for Barack Obama’s presidential campaign.

Axelrod’s firm recommended an aggressive promotional effort modeled on a political campaign—appoint a campaign manager, conduct focus groups, target messages to specific constituencies, then recruit religious leaders and other third-party “validators.” They, in turn, would write and submit opinion pieces to Chicago publications.

The medical center’s initiative provides a window into the close relationship between the Obamas, their associates at the University of Chicago and Axelrod, the strategist most central to Barack Obama’s rise.

Some health care experts saw through Mrs. Obama and her public relations man, David Axelrod—yes, the same David Axelrod who is now Mr. Obama’s senior adviser at the White House. The patient-dumping scheme was as transparent as Scotch tape. The University of Chicago Medical Center hired Axelrod’s public relations firm, ASK Public Strategies, to promote Mrs. Obama’s Urban Health Initiative. Axelrod had the blessing of Valerie Jarrett. His great contribution: Re-branding! Axelrod’s firm recommended re-naming the initiative after “[i]nternal and external respondents expressed the opinion that the word ‘urban’ is code for ‘black’ or ‘black and poor’.... Based on the research, consideration should be given to re-branding the initiative.”
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Axelrod and the Obama campaign refused to disclose to the
Washington Post
how much his firm received for its genius re-branding services.

No amount of repackaging could get around these bottom-line facts determined by the
Post
: As a hospital with non-profit tax status, the University of Chicago Medical Center receives special tax breaks for providing charity care. It spent a measly $10 million on charity care for the poor in fiscal 2007 when Mrs. Obama was employed there—“1.3 percent of its total hospital expenses, according to an analysis performed for
The Washington Post
by the bipartisan, nonprofit Center for Tax and Budget Accountability. That is below the 2.1 percent average for nonprofit hospitals in Cook County.” Prominent South Side physician Quentin Young called the finding “shameful. . . . They are arguably, if not defrauding, then at least taking advantage of a public subsidy.”

In February 2009, outrage in the community Mrs. Obama was supposedly so in tune with exploded after a young boy covered by Medicaid was turned away from the University of Chicago Medical Center. Dontae Adams’s mother, Angela, had sought emergency treatment for him after a pit bull tore off his upper lip.
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Mrs. Obama’s hospital gave the boy a tetanus shot, antibiotics, and Tylenol and shoved him out the door. The mother and son took an hour-long bus ride to another hospital for surgery. I’ll guarantee you this: you’ll never see the Adams family featured at an Obama policy summit or seated next to the First Lady at a joint session of Congress to illustrate the failures of the health care system.

The
Chicago Tribune
reported that Mrs. Obama’s hospital was “one of the only hospitals in the county that decreased its contribution to caring for uninsured patients from 2006 to 2007.”

“New level of compassion,” indeed.

Following the Adams incident, the American College of Emergency Physicians (ACEP) blasted Mrs. Obama and Mr. Axelrod’s grand plan. The group released a statement expressing “grave concerns that the University of Chicago’s policy toward emergency patients is dangerously close to ‘patient dumping,’ a practice made illegal by the Emergency Medical Treatment and Active Labor Act (EMTALA), and reflected an effort to ‘cherry pick’ wealthy patients over poor.”
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Favoring the wealthy over the poor while posing as guardians of the downtrodden? Hey, it’s the Chicago way. Just ask the tenants in Valerie Jarrett’s tax-subsidized slums.

The shady business of Michelle Obama’s non-profit hospital may not have garnered widespread national interest, but someone in the U.S. Senate was paying attention. In August 2008, Senate Finance Committee minority ranking member Republican Charles Grassley of Iowa pressed Mrs. Obama’s employer for more information about its glaringly obvious patronage positions and the “troubling” patient- dumping scheme. Senator Grassley has investigated the lack of adequate charity care and financial accountability at tax-exempt medical institutions for years. Non-profit hospitals receive billions in tax benefits at the local, state, and federal levels in exchange for providing “community benefit” to earn the tax-exempt status. Yet, many of those institutions routinely deny uninsured patients charitable care. “We need to get a better handle on how nonprofit hospitals are fulfilling their requirement to serve the community in exchange for the generous tax breaks they receive,” Senator Grassley concluded in April 2007 after congressional hearings found a lack of monitoring and standards. “This is especially important as policymakers talk about helping the uninsured.”
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Senator Grassley pressed the University of Chicago Medical Center (UCMC) with pointed questions concerning the Urban Health Initiative, another related “South Side Health Collaborative” program created by Mrs. Obama and funded with a federal grant in 2005, and Mrs. Obama’s position. Among the requests for information he made in his 11-page, August 29, 2008, letter:

• Please describe each of these programs including their history, mission, accomplishments, and revenues and losses since inception as well as the reduction in emergency room visits resulting from these programs;

• Provide minutes of board or other executive meetings documenting the decision to launch these programs;

• Describe how UCMC funds these programs;

• Describe UCMC’s marketing and outreach efforts for these programs. . . .
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And regarding Mrs. Obama’s position as Vice President of Community and External Relations: “[D]escribe the hiring and selection process for this position, including when the position was created, whether the vacancy was publicly announced, and the criteria for selection.”

The hospital’s response was due in fall 2008. Nearly two years later, it remains “under review” and unavailable for public consumption. And that’s the way Illinois Democrats would like to keep it. The Senate’s number two Democrat, Dick Durbin, bristled at Senator Grassley’s pointed questions. After Senator Grassley expressed concern that the medical center was “culling the least profitable patients from its emergency room” and “losing sight of the public service that comes with tax-exempt status,”
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Durbin huffed in September 2008: “The fact that Senator Grassley is questioning the work of the University of Chicago Medical Center—especially those programs aimed at reducing emergency department overcrowding and promoting preventive health—is troubling and shows that he simply doesn’t understand the problems facing our hospitals today.”
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To the contrary, Senator Grassley seems to understand the racket all too well.

DOCTORING THE BIDDING PROCESS

In his request for information from the University of Chicago Medical Center, Senator Grassley also raised the issue of the hospital’s policy governing political activity, given its numerous ties to the Obamas: its policy regarding management salaries; its criteria for hiring and compensating public relations firms; and its process for selecting contractors.
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One of those contractors was businessman Robert Blackwell Sr., who owned an information technology firm, Blackwell Consulting Services. After Mrs. Obama received her promotion at the University of Chicago Medical Center, the hospital made unprecedented changes to its regular bidding process in order to include Blackwell in a competition to upgrade the center’s internal computer network. Lo and behold, Blackwell Consulting won the contract and received a whopping $600,000-plus for its work. The university touted Mrs. Obama’s minority vendor expansion as evidence of her neighborhood outreach accomplishments.
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But Blackwell wasn’t any ordinary minority business owner in need of a leg up.

Coincidentally, Chicago-style, Blackwell Sr. had served on a local literacy group board with Mrs. Obama for years.