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Are Blagojevich and Jesse Jackson Jr.'s Money Dealings with Chicago's Indian Community Tied to the Corruption Charges?

Clues emerge in the possible connection between Jesse Jackson Jr., Blagojevich, and the money for Obama's vacant Senate seat.

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Right after Obama’s election, Blagojevich said, “I want to make some money.” He was agnostic about whom he would nominate to Obama’s seat as long as he would get some tangible benefit from the act. Obama’s team, by all accounts, refused to barter the seat although questions remain about the contact between Obama’s Chief of Staff Rahm Emanuel and the Blagojevich people.

Jackson says that he had limited contact with Blagojevich, and when the scandal broke, he said, “I did not initiate nor authorise anyone, at any time, to promise anything to Gov. Blagojevich on my behalf. I never sent a message or an emissary to the Governor to make an offer or to propose a deal about the U.S. Senate seat.” Federal officials arrested Blagojevich on December 9 on charges of corruption. He is now out on bail, facing an impeachment motion in the Illinois legislature.

The spotlight turned, briefly, on the Indian-American community in Chicago. These men, Nayak, Bhatt and Bedi, were a sideshow to the greater scandals, which were how much Jackson knew and what kind of contact Obama’s transition team had with Blagojevich. Over the years, Blagojevich and Jackson had cultivated the increasingly affluent Indian-American community in Chicago. Blagojevich had a fruitful relationship with the banker Amrish Mahajan and his wife, the businesswoman Anita Mahajan. “Uncle Amrish”, as many know him, came to prominence through his close ties with the Parrillo family (a political clan that is linked to the Chicago mafia).

Mahajan rose to the head of Mutual Bank, whose well-heeled customers donated money to politicians anointed by the Mahajans. Blagojevich was a major beneficiary, as money entered his campaign war chest, and his wife, Patti, earned huge real estate contracts from the Mahajan circle. In 2007, the government arrested and charged Anita Mahajan with overbilling the State for millions of dollars on her State contract. Harish Bhatt’s pharmacies are currently under investigation on the grounds that Bhatt’s fund-raising for Blagojevich turned into phone calls to regulators to lay off from their investigation of fraud.

All of this has frazzled the Indian-American community. Nayak is a well-regarded businessman and a philanthropist. His charity includes setting up hospitals in India and raising funds for tsunami relief. Nayak’s closest ties are with the Jackson family.

He won the PUSH Excellence for Public Service award from Jesse Jackson’s Operation Push and accompanied Jackson to India in November 2007. (Nayak organised a lecture by Jackson at Jawaharlal Nehru University, Delhi.) In addition, Nayak brought the main Chicago Democrats into the India Caucus and was a booster for the India-U.S. nuclear deal. Nayak, Mahajan, Bedi, Bhatt and others are all close allies who have leveraged their political connections for economic gain and used that money to strengthen their political heft.

Everything that the Indian Americans did is customary. Political campaigns have become overwhelmingly expensive. The 2008 presidential race cost more than $1 billion. In addition, elected officials live within the social confines of the very wealthy and often aspire to their lifestyle. Even as more and more millionaires run for public office, the bulk of the elected officials do not win on the strength of family wealth.

Their jobs do not provide them with the kind of funds to earn the six- or seven-figure salaries that they would need to fulfil their upwardly mobile aspirations.

Scandals are now commonplace. The fallout from the sleazy pay-to-play empire set up by the lobbyist Jack Abramoff continues to resonate through Washington, D.C., notably inside the Republican Party (many of whose elected officials, such as Congressman Randy Cunningham, are now in prison).