WASHINGTON – A former CEO leading Sen. Barack Obama's search for a vice presidential candidate resigned abruptly yesterday after questions about his home mortgage and business deals became a distraction for a candidate who argues he's not influenced by special interests.
Jim Johnson's resignation came a day after Obama defended him and dismissed the Republican criticism of Johnson, the former chairman of mortgage lender Fannie Mae.
“I am not vetting my VP search committee for their mortgages,” Obama said Tuesday.
He accepted Johnson's resignation yesterday, leaving the search at least temporarily in the hands of two other prominent Democratic attorneys who had been scouting candidates – former Deputy Attorney General Eric Holder and Caroline Kennedy.
“Jim did not want to distract in any way from the very important task of gathering information about my vice presidential nominee, so he has made a decision to step aside that I accept,” Obama said. “We have a very good selection process under way, and I am confident that it will produce a number of highly qualified candidates for me to choose from in the weeks ahead.”
Johnson came under fire from GOP candidate Sen. John McCain and the Republican Party after The Wall Street Journal reported Saturday that Johnson got mortgages with help from the CEO of Countrywide Financial Corp.
McCain had accused Obama of hypocrisy for speaking out against Countrywide's role in the subprime mortgage crisis.
The Washington Post reported yesterday that alleged accounting manipulations for 1998 had resulted in maximum payouts to Fannie Mae's senior executives – $1.9 million in Johnson's case – when the company's performance that year would have yielded no bonuses. Even after he left Fannie Mae in 1999, Johnson received millions of dollars in guaranteed consulting fees and perks that included an office, two secretaries and a car and driver for himself and his wife.
Still more questions emerged about Johnson's role on corporate boards that had approved the kind of lucrative executive pay packages that Obama routinely excoriates on the campaign trail.
Obama's campaign declined to say whether he would replace Johnson, who also led the vice presidential search effort for Democratic nominee John Kerry in 2004 and Walter Mondale in 1984.
Obama's campaign has had varying responses when controversy has focused on those around him. Foreign policy adviser Samantha Power left within hours of calling Hillary Rodham Clinton a “monster.” Obama was initially reluctant to disavow his pastor, Jeremiah Wright, after video of racially explosive sermons emerged. He kept leading economic adviser Austan Goolsbee on board amid controversy surrounding his private comments on free trade.
At least five McCain staffers have left his campaign after a Democratic uproar over McCain's connections to lobbyists. McCain responded by banning registered lobbyists serving his campaign but has defended two of his top advisers – Rick Davis and Charlie Black – who left their lobbying jobs to work for his presidential bid.
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