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Shady HUD Secretary to resign Update: Stepping down April 18; “must attend more diligently to personal and family matters.”

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By Michelle Malkin  •  March 31, 2008 08:40 AM

Scroll down for updates…

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Bush’s HUD Secretary Alphonso Jackson is expected to resign this morning. The WSJ says the resignation “will deal a blow to the Bush administration’s efforts to tackle the housing crisis.” Two quick points on that.

1) To the extent that it will stop the administration from pandering on the subprime crisis and increasing government meddling to make it worse, I’m all for “dealing a blow” to those efforts.

Regarding the newly announced Bush administration mortgage bailout plans today, I’m with Hans Bader and Right Truth, who say these plans turn the Aesop’s fable about the ant and the grasshopper on its head

2) Jackson’s alleged cronyism sounds like past Bush administration cronyism I’ve criticized sharply before (see my blogging on Michael Brown, Julie Myers, and DHS). If half of what’s alleged is true, how would his resignation “deal a blow” to the administration?

Some details:

Housing and Urban Development Secretary Alphonso Jackson is expected to announce his resignation Monday, according to people familiar with the matter, a decision that will deal a blow to the Bush administration’s efforts to tackle the housing crisis.

The exact reasons for Mr. Jackson’s decision couldn’t be learned. Earlier this month, two Democratic senators, Patty Murray of Washington and Christopher Dodd of Connecticut, sent a letter to President Bush urging him to request Mr. Jackson’s resignation, arguing that accusations of wrongdoing had made him ineffective.

The department has scheduled an announcement for 10 a.m. Asked if Mr. Jackson was planning to resign, HUD spokeswoman DJ Nordquist said she was “not at liberty to say what the announcement is.”

Mr. Jackson, a former top housing official in Texas, Washington, D.C., and Missouri, has consistently denied any improper behavior while leading HUD. Still, his poor relationship with Democrats has hurt the White House’s efforts to broker deals in response to the housing crisis. For example, Democrats have criticized the way he handled public housing after Hurricane Katrina, an issue that has dogged him ever since.

More:

HUD runs the Federal Housing Administration, a big government division that insures mortgages for low-income homeowners and first-time home buyers. Many Democrats and Republicans have envisioned expanding the FHA to play a bigger role in stabilizing the mortgage market. The FHA would also be at the center of a HUD plan to provide partial insurance to homeowners who owe more money on their mortgages than their homes are worth.

Mr. Jackson’s most-recent problems stem from a Philadelphia redevelopment deal. The city’s housing authority has filed a lawsuit charging that Mr. Jackson tried to punish the agency for blocking a deal involving a friend of his. The allegations came up during congressional hearings this month. Mr. Jackson declined to answer questions, saying the judge in the lawsuit had instructed the department not to talk.

HUD has argued it wants to change the housing authority’s special funding status because it lacks enough housing for the disabled.

In 2006, HUD’s inspector general investigated remarks made by Mr. Jackson that some interpreted to mean that contracts were awarded in some cases based on political affiliation. The report didn’t find any wrongdoing at the agency.

“Why should I reward someone who doesn’t like the president, so they can use funds to try to campaign against the president?” Mr. Jackson was quoted as saying in the Dallas Business Journal. “Logic says they don’t get the contract. That’s the way I believe.”

Mr. Jackson’s remarks elicited a firestorm of controversy on Capitol Hill. Afterward, in a statement from HUD, Mr. Jackson said, “I deeply regret the anecdotal remarks I made at a recent Texas small-business forum and would like to reassure the public that all HUD contracts are awarded solely on a stringent merit-based process.”

From a September 2006 probe:

An inspector general’s report charges that top U.S. housing official Alphonso Jackson urged staff members to favor friends of President Bush when awarding Department of Housing and Urban Development contracts. But investigators so far have found no direct proof that Jackson’s staff obeyed.

His chief of staff told investigators that Jackson, the HUD secretary, “personally intervened with contractors whom he did not like . . . these contractors had Democratic political affiliations,” says the report, a copy of which was made available to The Washington Post.

The investigation “did not disclose any pattern or practice of issuing contracts based on political affiliation . . . however, there were some limited instances where political affiliation may have been a factor in contract issues involving Jackson,” the report says.

Awarding contracts on the basis of party affiliation violates federal law.

The 340-page report by the Criminal Investigations Division of HUD’s Office of Inspector General has been released to Jackson for a response and given to members of Congress who requested it. A spokesman for the office declined to say whether the report would be released publicly.

Calls for an inquiry came after Jackson, Bush’s onetime neighbor in Dallas and former housing authority chief in that city, told attendees at a public forum in Dallas on April 28 that he had killed a contract award to a firm after its chief told Jackson he disliked Bush. Jackson later took back his remarks and told investigators from the inspector general’s office that he had “lied, and I regret having done that.”

***

Bush loyalists will complain about the Democrat “witch hunt” against Jackson. Well, you know what they say about broken clocks. And yes, the sanctimony of the likes of Hillary Clinton is hard to stomach. But this guy was trouble. Trouble the administration didn’t need:

Clinton’s campaign released the former first lady’s statement before the resignation, which was reported Monday morning by the Associated Press, was made official. The New York senator has sought to make her plan to help the struggling housing market a centerpiece of her presidential campaign.

“Secretary Jackson’s resignation ends a tenure at HUD marked by an indifference to Congressional oversight powers, cronyism, and corrupt contracting practices that have no place in our government,” Clinton stated.

She really does have gall, doesn’t she?

***

Update: Well, that’s one way to put it…

Jackson, 62, has been fending off allegations of cronyism and favoritism involving HUD contractors for the past two years. The FBI has been examining the ties between Jackson and a friend who was paid $392,000 by Jackson’s department as a construction manager in New Orleans after Hurricane Katrina.

The HUD chief made no direct mention of that in his resignation statement. Explaining his move, he said: “There comes a time when one must attend more diligently to personal and family matters. Now is such a time for me.”

He did not take questions or elaborate on the family reasons he cited for the decision. The group assembled to hear Jackson’s statement applauded and he left the room.

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