Did Obama Team Have Contact with Ill. Gov.?

CHICAGO (AP) -- Barack Obama insists he didn't have any contact with Illinois Gov. Rod Blagojevich or anyone else who might have been scheming to sell the president-elect's U.S. Senate seat. But he has not yet given his transition staff the same clean bill of health - perhaps with good reason.

An examination of the FBI complaint against Blagojevich and the days immediately following Obama's historic election victory suggests the governor was highly interested in Obama confidante Valerie Jarrett as a potential Senate appointee, albeit with a steep price tag.

The 76-page complaint contains multiple references to "Senate Candidate 1," whose description clearly fits Jarrett, a former finance chief for Obama's earlier campaigns and incoming senior White House adviser.

In secretly recorded conversations, the Democratic governor said he'd be willing to appoint Jarrett - Obama's supposed favorite to replace him - in return for a high-paying job at a national union organization called Change to Win.

At a news conference Thursday, Obama said his office was assembling any information about possible contacts "between the transition office and the governor's office," and that he intended to release any such detail in the next few days.

"But what I'm absolutely certain about is that our office had no involvement in any dealmaking around my Senate seat," Obama said. "That I'm absolutely certain of."

It remained unclear whether anyone on Obama's team had been in contact with Blagojevich or his associates regarding the Senate seat.

According to the complaint, Blagojevich met Nov. 5 with an official of the Service Employees International Union-Local 1 who is believed to be Tom Balanoff, a longtime Obama supporter who spoke at the Democratic National Convention.

Blagojevich "understood" that the SEIU official was "an emissary to discuss Senate Candidate 1's interest" in the Senate seat. Though just a day after the election, media reports had already identified Jarrett as being interested in the job.

SEIU officials released a statement Thursday saying the organization had been in contact with the U.S. attorney's office and had no reason to believe the union or any union official had been involved in misconduct. The statement said the union, and specifically Balanoff, were "fully cooperating" with the probe.

During a Nov. 5 call, Blagojevich said the Senate appointment was a thing of value, something not given away "for nothing."

Two days later, Blagojevich allegedly suggested he'd be willing to "trade" the Senate seat to Jarrett in exchange for the Health and Human Services secretary's job. He repeated that desire during a separate, three-way call involved Blagojevich, Chief of Staff John Harris and someone identified only as "Advisor B," a Washington-based consultant.

Harris noted that Blagojevich also would consider being appointed to a high-paying position at Change to Win and that Balanoff, who declined numerous requests for an interview with The Associated Press, could guarantee the appointment.

In return, Obama would be expected to help Change to Win with its legislative agenda on a national level, said Harris, according to the criminal complaint.

As the FBI listened in, Harris suggested the three-way deal would give Obama "a buffer so there is no obvious quid pro quo" regarding Jarrett. And "Adviser B" said "they should leverage the President-elect's desire to have Senate Candidate 1 appointed to the Senate seat" in exchange for a big job at Change to Win.

On Nov. 10, Blagojevich, his wife, Harris, the governor's chief counsel William R. Quinlan and several Washington-based advisers conducted an extraordinary two-hour conference call.

Blagojevich conceded he probably wouldn't get the HHS job or an ambassadorship because of so much negative publicity surrounding him.

Using several expletives, Blagojevich said he was reluctant to give Obama "his senator" without anything in return; he said he'd appoint a deputy governor before giving the job to Candidate 1. He also considered appointing himself to the job to avoid impeachment.

During the next 36 hours, the governor grew angry and suggested Obama's camp was not interested in making a deal.

"They're not willing to give me anything except appreciation. (Expletive) them," Blagojevich told Harris in an intercepted call Nov. 11. The men talked about alternative candidates and perhaps starting a nonprofit organization that could possibly be funded by a wealthy Obama supporter, perhaps Warren Buffett.

Asked Thursday why the governor might have believed the Obama camp wasn't going to cooperate, Obama refused to speculate.

"I can't presume to know what was in the mind of the governor during this process," he said. "All I can do is read what was in the transcripts, like the rest of you have read it, and shake my head."

On Nov. 12, major news organizations, including the AP, quoted sources as saying Jarrett was not interested in the Senate seat. The Chicago Tribune said it had received an e-mail from Jarrett declaring, "I am not interested in the Senate seat."

But as the day wore on, Blagojevich continued to discuss the possibility of appointing "Senate Candidate 1" in a series of calls; Blagojevich would stay on as governor and ostensibly run the nonprofit.

"Adviser B" told the governor he liked the Change to Win job best because "from the President-elect's perspective, there would be fewer `fingerprints'" because the union organization was already in existence and fully funded.

During one of the calls, Blagojevich informed the union official - believed to be Balanoff - that he'd heard Obama now wanted other candidates considered. Balanoff said he would find out if "Senate Candidate 1" wanted to keep pushing for the Senate seat.

In an appearance at Harvard's Kennedy School of Government on Thursday, David Axelrod, a senior Obama adviser, said Obama had intended from the start to have Jarrett in the White House, and that Jarrett withdrew from Senate contention once Obama made his feelings known.

"Valerie Jarrett is a longtime friend, adviser, very able person, and his preference was always that she serve in the White House, and ultimately he expressed that to her," The New York Times quoted Axelrod as saying. "That's why she made the decision. No one in their wildest imagination could have imagined the situation that ensued."

The discussion during a Nov. 13 call between the governor and "Adviser A" made it clear Blagojevich wanted a deal from Obama whether his pick was Jarrett or someone else, according to the complaint. And in subsequent recorded conversations, the governor indeed moved on to other possible candidates, including Rep. Jesse Jackson Jr.

On Nov. 15, Obama announced the appointment of Jarrett as one of his key advisers. And yet nine days later, Blagojevich may not have given up on the idea that Jarrett was still his way to cash in: According to Sen. Dick Durbin, D-Ill., he spoke to the governor about Jarrett on Nov. 24.

"The governor asked me, `What about Valerie Jarrett? Do you think she's serious?'" Durbin said, an apparent reference to her withdrawal from consideration.

"I said, `Yes, I talked to her. She said she doesn't want this. She's going to stick with Obama,'" Durbin said.

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Associated Press writer Dennis Conrad in Washington contributed to this report.

© 2008 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.


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