Oct. 11 (Bloomberg) -- The two men seeking a U.S. Senate seat President Barack Obama once held in Illinois questioned each other’s trustworthiness as they faced off in their first debate yesterday.
Republican Mark Kirk said Alexi Giannoulias had done business with mobsters, while the Democrat accused his opponent of telling “some real whoppers” during the campaign.
“We shouldn’t be surprised that the congressman is lying again,” Giannoulias said after Kirk criticized his time as a senior loan officer at Broadway Bank in Chicago.
Central to the discussion was the fallout from the April failure of the family bank and Kirk’s need to apologize for exaggerating his military and personal biography.
The 30-minute debate in Washington, broadcast on NBC’s “Meet the Press,” showcased a race that polls show is one of the nation’s most competitive Senate contests.
At one point, Kirk held up a sheet of paper he said showed a list of loans made by the bank to “convicted mobsters and felons” when Giannoulias was a senior loan officer.
“The Broadway Bank provided an extraordinary amount of loan capital, millions of dollars, to mob figures and convicted felons, after they had been convicted,” Kirk said. “I don’t have experience in loaning money to mob figures. I don’t have experience in reckless loans to commercial real estate and brokered hot money deposits leading to a collapse of the bank.”
As he has throughout the campaign, Giannoulias said he didn’t know the full backgrounds of some of those who received bank loans.
“If I knew then what I know now, these aren’t the kind of people that we do business with,” he said. “I didn’t know the extent of their activity.”
Giannoulias, 34, is the Illinois state treasurer and an occasional Obama basketball buddy, while Kirk, 51, is a five-term congressman from Chicago’s northern suburbs.
Moderator David Gregory asked Kirk to explain why he exaggerated his U.S. Naval Reserve service to voters.
“I was careless and I learned a very painful and humbling lesson,” Kirk said. “I am completely accountable for this.”
Asked about statements he had made about being shot at while flying over Iraq, Kirk said he was unsure whether that happened.
Skies Over Iraq
“When you are flying over Iraq as a big NATO strike package, usually the Iraqis opened up on us,” he said, adding that it is “very confusing” to know whether his squadron came under fire.
Giannoulias was asked to explain the timing of his departure from the bank following a Sept. 29 Chicago Tribune story that reported on a $2.7 million tax deduction the candidate took last year.
He has said that he left the troubled bank in late 2005, although his tax documents showed he claimed to have worked at least 500 hours there in 2006, a time when loans were made to Antoin “Tony” Rezko, who was later convicted of influence peddling, and to a family later accused of having connections to organized crime.
“Nothing I said has been inconsistent,” Giannoulias said. “I said I left day-to-day operations in 2005.”
After the debate, Kirk told reporters he favors “indefinitely” extending the tax-rate reductions enacted under President George W. Bush, though he thinks the Senate could more easily agree to a two-year extension.
Giannoulias told reporters Kirk is falsely presenting himself as a fiscal conservative.
“It’s another whopper to keep on saying he’s a fiscal hawk,” he said. “The truth is no one in this race has taxed more, spent more, borrowed more and lied more.”
Giannoulias told reporters that he didn’t say anything about the bank during the debate that he hadn’t said before.
“We knew there were rumblings of problems,” he said. “These weren’t loans that I was intimately involved in. These weren’t relationships that I brought to the bank.”
In the debate, Giannoulias defended the president’s handling of the economy and said that a government stimulus package helped the country avoid “a second Great Depression.”
Kirk argued that stimulus spending hasn’t worked and has only served to increase the nation’s debt, while also urging repeal of the health-care overhaul passed by Congress.
Obama has placed his political capital and prestige on the line for the race, which offers a symbolic referendum on him. He appeared in Chicago last week with Giannoulias, his second fundraising appearance for the Democrat in a little more than two months. First lady Michelle Obama is scheduled to make a fundraising stop in Chicago this week for Giannoulias.
The first family visits could rekindle local interest in a Senate race that has been overshadowed this month by the unexpected return to Chicago of Obama’s former chief of staff, Rahm Emanuel, to explore a potential mayoral bid to replace retiring Mayor Richard M. Daley.
Obama’s investment in the Illinois race is part of a White House effort to fight a tide in November’s congressional elections that threatens Democratic control of the House and possibly the Senate. The party’s loss of the Illinois seat would boost Republican chances of gaining the 10 needed to win a Senate majority.
A Chicago Tribune/WGN-TV poll taken Sept. 24-28 showed Giannoulias held a statistically insignificant lead of 38 percent to 36 percent. The survey, which showed 17 percent undecided, had a 4 percentage-point error margin.
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