Union leader says Blagojevich brought up Cabinet post during talk about Senate seat

Rod Blagojevich brought up the possibility of a Cabinet post for himself after a union leader with close ties to Barack Obama urged the Illinois governor to appoint a friend of the president-elect to the U.S. Senate, the union official testified Tuesday.

Tom Balanoff, an official with the Service Employees International Union, said he told Blagojevich after the November 2008 election that he had spoken with Obama and the president-elect believed Valerie Jarrett had the qualifications he was looking for in a senator.

Balanoff said Obama told him in an election eve phone call he was taking no position on who should get the Senate seat he was leaving to become president and that he would prefer to have Jarrett as a White House adviser — but that she wanted to be a senator. Balanoff testified that he told Obama he would contact Blagojevich on behalf of Jarrett.

But when he mentioned the possible Jarrett appointment, Blagojevich immediately brought up his interest in becoming secretary of health and human services in Obama's Cabinet, Balanoff said.

Balanoff quoted Blagojevich as saying he loved being governor, but had a "passion for health care" and "if I could be secretary of health and human services I could carry out my passion." Balanoff said that sounded like an offer to trade the seat for the Cabinet post.

"I said that isn't going to happen," Balanoff testified.

Blagojevich, he said, responded by saying, "Is that because all the investigations around me?"

Balanoff said Blagojevich also brought up the possibility of a foundation job or a post with a labor union then and in several phone calls in the days that followed.

He quoted Blagojevich as suggesting that union officials might get billionaire investors like Warren Buffett and George Soros to put money into a foundation for him and then "our new senator, Valerie Jarrett, could go about doing her job."

The testimony from Balanoff, a political insider and close ally of Obama, was at the heart of the most prominent charge in the 24-count indictment against Blagojevich — that he schemed to get a payoff in the form of a major job or a massive campaign contribution in exchange for an appointment to the U.S. Senate seat.

Balanoff followed former Blagojevich chief of staff John Harris on the witness stand. Harris had testified earlier in the trial that Blagojevich told him he had sent a message to Obama that he would trade the Senate seat for the Cabinet appointment.

Harris also testified that one Blagojevich plan involved a so-called three-way trade in which Jarrett would get the seat, the governor would get a Cabinet post or foundation job and the union would score points with the new president. Jarrett is a longtime Obama family friend.

Blagojevich stared at Balanoff, whose union endorsed him in 2002 and 2006, delivered some of the strongest testimony to date at the trial.

The former governor's anger flared in an FBI tape played Tuesday in which he and an aide discussed a story about the FBI investigation written by award-winning Chicago newspaper and television journalist Carol Marin.

"I hate her," Blagojevich says, his voice seething with cold fury. "I hate her."

Marin sat calmly in court as the tape was played.

The ousted governor, 53, has pleaded not guilty to scheming to sell or trade the Senate seat and to plotting to launch a racketeering operation within the governor's office. If convicted, he could face up to $6 million in fines and a sentence of 415 years in prison, though he is sure to get much less time under federal guidelines.

His brother, Robert Blagojevich, 54, has pleaded not guilty to taking part in the alleged scheme to sell the seat and to illegally pressuring a campaign contributor for money.

Blagojevich jurors got to hear on Tuesday the best-known of the hundreds of hours of FBI tapes of the governor and his circle on the phone and in their offices.

"I've got this thing and its (expletive) golden," Blagojevich says referring to his power to appoint a senator in a November 2008 phone call with former deputy governor Doug Scofield. "I'm just not giving it up for (expletive) nothing."

That quote appears in a federal affidavit that was filed in December 2008 the day Blagojevich was arrested and has been quoted in news accounts often in the 19 months since.

In his book, "Governor," Blagojevich wrote that his real plan for the Senate seat was to make a deal with Illinois House Speaker Michael Madigan under which his daughter, Illinois Attorney General Lisa Madigan, would be appointed. Under the plan, the elder Madigan would then make sure a Blagojevich legislative package would get through the House.

Harris testified that Blagojevich was using the supposed deal as "political cover" that would make him look less self-serving if he appointed himself to the Senate seat. The former aide said he never considered the Madigan deal realistic, especially if it contained "poison pills" such as no-new-taxes and no-impeachment provisions.