Former Fannie Mae Chairman James Johnson said Wednesday he has quit Sen. Barack Obama’s vice presidential search committee after published reports suggested he may have received preferential mortgage terms from Countrywide Financial Corp.
Johnson said he left to avoid being a hindrance to Obama, the presumptive Democratic nominee.
“I would not dream of being a party to distracting attention from that historic effort,” he said in a statement. “I believe Barack Obama’s candidacy for president of the United States is the most exciting and important of my lifetime.”
Johnson’s ties to Countrywide became a campaign issue after Republicans pointed out that Obama had been critical of the mortgage lender in campaign speeches. Johnson’s role as a political insider also contrasted with Obama’s pledge to bring change to Washington.
Johnson, 64, said that he has done nothing wrong, saying “blatantly false statements and misrepresentations” were written about him.
In an e-mail, Obama acknowledged the resignation.
“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,” he wrote on Wednesday.
Obama said he is “confident” his vice presidential search process will produce “a number of highly qualified candidates” in coming weeks.
Johnson was part of a three-person team, along with Caroline Kennedy, the daughter of the late President John F. Kennedy, and former Deputy U.S. Attorney General Eric Holder, who were tapped to help vet prospective running mates for Obama.
Johnson, who ran Walter Mondale's 1984 presidential campaign, helped 2004 Democratic nominee John Kerry in his vice presidential search.
Angelo Mozilo, the chief executive officer of Countrywide, the biggest U.S. home lender, may have given Johnson and other friends good deals on mortgages, the Wall Street Journal reported on June 7, citing unidentified people familiar with the matter.
The newspaper didn’t provide any specifics on whether favors were granted.
Since then, Johnson’s position on the search committee has drawn criticism from Republicans who noted that Obama, the presumptive Democratic nominee, repeatedly denounced Countrywide for its role in the subprime-mortgage crisis.
“These are the folks who are responsible for infecting the economy and helping to create a home-foreclosure crisis — 2 million people may end up losing their homes,” Obama said of Countrywide at a March 31 campaign appearance in Lancaster, Penn.
One Republican strategist said mismatches between Obama’s rhetoric and the realities of a presidential campaign would continue to be exploited.
“Soaring rhetoric turns into harsh reality really fast and this is going to happen to Obama over and over again,” said Terry Holt, a Republican strategist and former campaign spokesman for President George W. Bush. “People’s expectations of Obama are going to be difficult to keep up.”
A Countrywide spokesman didn’t immediately return a phone call seeking comment on Johnson’s loans. Fannie Mae spokesman Brian Faith declined to comment on Johnson’s resignation.
— Bloomberg News