Mayor Daley's Connection to Obama's Patron

The Chicago Sun-Times reports:

Two decades ago, Antoin "Tony'' Rezko was running a food company that peddled hot dogs on Chicago's beaches. Daniel S. Mahru supplied the ice.

These businessmen had a brainstorm for a new venture -- rehabbing rundown buildings for poor black families.

Rezko and Mahru had no construction experience. Yet City Hall gave their new company, Rezmar Corp., a $629,000 loan to help fix up an abandoned apartment building at 46th and Drexel.

They had applied for the loan just six days after Richard M. Daley won his first term as mayor in 1989, having campaigned on a promise to build more housing for the poor.


Rezko and Mahru got the loan four months later, and quickly became one of the Daley administration's favored developers. They got deal after deal -- between 1989 and 1998, more than $100 million from the city, state and federal governments and bank loans to rehabilitate 30 buildings in Chicago.

Rezmar was paid at least $6.9 million to develop those apartments.

Taxpayers have lost $5.7 million in grants and loans written off by the Daley administration, a Chicago Sun-Times investigation has found.

Why the government is involved in making loans at all is inappropriate.