There’s a scene in Casablanca which sums up the cynic’s take on politics.

Rick: How can you close me up? On what grounds?

Renault: I’m shocked, shocked to find that there is gambling going on here!

Croupier: Your winnings, sir.

Renault: Oh, thank you very much.

Which is about where I am on Senator Dodd’s reaction to the Countrywide Mortgage deal. His statement:

“As a United States Senator, I would never ask or expect to be treated differently than anyone else refinancing their home. This suggestion is outrageous and contrary to my entire career in public service. When my wife and I refinanced our loans in 2003, we did not seek or expect any favorable treatment. Just like millions of other Americans, we shopped around and received competitive rates.”

Compare and contrast. But as the story unfolds, it’s not just Dodd. Bloomberg Worldwide reports:

Senator Kent Conrad said he was given preferential treatment on a mortgage from Countrywide Financial Corp. and will write a $10,500 check to charity.

“It appears Countrywide waived one point on my mortgage,” Conrad, a North Dakota Democrat, said in a statement today in Washington. “Although I did not ask for or know that I was receiving a discount, and even though I was offered a competitive loan from another lender, I do not want to have received preferential treatment.”

Conrad said he also received a loan from Countrywide on an eight-unit apartment building in Bismarck, North Dakota, even though the lender typically serves properties that have four units or less. He said he had decided to refinance that loan with another institution.

Conrad and Senator Christopher Dodd, who oversees the U.S. mortgage industry as chairman of the Senate Banking Committee, were among those who received loans through Countrywide’s “V.I.P.” program, which waived points, fees and borrowing rules for prominent people, Portfolio magazine reported June 12. Dodd has denied receiving preferential treatment.

“He never expected, asked for or was aware of any special treatment,” Conrad’s spokesman, Chris Thorne, said. “He is paying this to make absolutely clear he will not partake in any preferential treatment.”

A telephone message requesting comment left for Jumana Bauwens, a spokeswoman for Countrywide, wasn’t immediately returned.

Conrad received two loans from Countrywide, one for $1 million to refinance a vacation home and another for the eight- unit building in Bismarck, according to Portfolio.

Portfolio, dug the info on the VIP program a couple of days ago:

Senators Christopher Dodd, Democrat from Connecticut and chairman of the Banking Committee, and Kent Conrad, Democrat from North Dakota, chairman of the Budget Committee and a member of the Finance Committee, refinanced properties through Countrywide’s “V.I.P.” program in 2003 and 2004, according to company documents and emails and a former employee familiar with the loans.

Other participants in the V.I.P. program included former Secretary of Housing and Urban Development Alphonso Jackson, former Secretary of Health and Human Services Donna Shalala, and former U.N. ambassador and assistant Secretary of State Richard Holbrooke. Jackson was deputy H.U.D. secretary in the Bush administration when he received the loans in 2003. Shalala, who received two loans in 2002, had by then left the Clinton administration for her current position as president of the University of Miami. She is scheduled to receive a Presidential Medal of Freedom on June 19.

Holbrooke, whose stint as U.N. ambassador ended in 2001, was also working in the private sector when he and his family received V.I.P. loans. He was an adviser to Hillary Clinton’s presidential campaign.

Portfolio reported that the deals  that Countrywide made were for two loans at special rates  in 2003. A $503,000  refinance of Dodd’s  Washington townhouse, and another refinance for Dodd’s  home in East Haddam, Conn. The documents Portfolio cites report that Countrywide waived 3/8ths of a point, or about $2,000, on the townhouse loan, and 1/4 of a point, (about $700), on the second, according to internal documents cited by Portfolio on closing costs. And the rates were 4.5% and 4.25%. Both loans were for 30 years, with the first five years at a fixed rate.

The details though aren’t the issue. The who part of the Countrywide VIP program and who “qualified” is. Even Captain Renault would recognize this for what it is.

source: Bloomberg Worldwide, Conrad Says Countrywide Waived Point on His Mortgage (Update1), By John Hughes and Nadine Elsibai, June 14, 2008

source: Portolio, Countrywide’s Many ‘Friends’, by Daniel Golden, Jun 12 2008