Keating Economics

This brief video story was produced by the Barack Obama campaign as an effort to discredit Obama's opponent, John McCain. The video details the investigation into Charles Keating and the five senators he supposedly bribed, including John McCain. More from the Washington Post:

"McCain was ultimately exonerated by the Ethics Committee, which did fault him for exercising poor judgment in attending two meetings with federal regulators about their case against Keating, a once high-flying savings and loans owner who contributed $112,000 to McCain campaigns (as well as making gifts that were not found to be illegal). The collapse of Keating's thrift ultimately cost taxpayers billions, and Obama's campaign mounted a full-scale assault today on McCain's involvement, with an ad and short web documentary questioning his judgment."

The Keating Five were five United States Senators accused of corruption in 1989, igniting a major political scandal as part of the larger Savings and Loan crisis of the late 1980s and early 1990s. The five senators, Alan Cranston (D-CA), Dennis DeConcini (D-AZ), John Glenn (D-OH), John McCain (R-AZ), and Donald W. Riegle (D-MI), were accused of improperly intervening in 1987 on behalf of Charles H. Keating, Jr., chairman of the Lincoln Savings and Loan Association, which was the target of a regulatory investigation by the Federal Home Loan Bank Board (FHLBB). The FHLBB subsequently backed off taking action against Lincoln.

Lincoln Savings and Loan collapsed in 1989, at a cost of $2 billion to the federal government. Some 23,000 Lincoln bondholders were defrauded and many elderly investors lost their life savings. The substantial political contributions that Keating had made to each of the senators, totalling $1.3 million, attracted considerable public and media attention. After a lengthy investigation, the Senate Ethics Committee determined in 1991 that Alan Cranston, Dennis DeConcini, and Donald Riegle had substantially and improperly interfered with the FHLBB in its investigation of Lincoln Savings, with Cranston receiving a formal reprimand. Senators John Glenn and John McCain were cleared of having acted improperly but were criticized for having exercised "poor judgment".

All five of the senators involved served out their terms. Only Glenn and McCain ran for re-election, and they both succeeded. McCain would go on to become the Republican nominee for president in 2008.

Source: Wikipedia