Joe Biden endorsed a little-known Pennsylvania governor for president in 1975 around the same time the elected official helped his younger brother James secure a $300,000 bank loan to keep his troubled nightclub afloat.
Shortly after serving as the chief fundraiser for his brother’s 1972 U.S. Senate campaign, James Biden sought to transition from his career as a salesman to opening a night club. Even though James Biden had no business experience and a paltry net worth, he was able to secure a series of generous loans at the outset of the venture in 1973. The loans, which mostly came from local Delaware banks, raised concerns about influence peddling because of James Biden’s lack of collateral and the fact his brother had just been appointed to the Senate Banking Committee.
The first series of loans—totaling $165,000—were provided by Wilmington’s Farmers Bank, which, although privately managed, was partially owned by the public with the state of Delaware having a 49 percent stake. The Wilmington Morning News reported, of the total, $60,000 was “unsecured,” meaning that James Biden was “personally liable” for its repayment.
Despite the extensive startup capital, the club failed to turn a profit and by 1975 had run up debts totaling more than $500,000. James Biden and his business partners, which by then included his brother-in-law John T. Owens, turned to First Pennsylvania Bank—in neighboring Philadelphia—for a bailout. Even though James Biden claimed a total net worth of $10,050, he and his partners were able to arrange a loan of $300,000 loan from First Pennsylvania. The loan was secured thanks to the intervention of then-Pennsylvania Gov. Milton Shapp (D). who vouched for James Biden and his partners with the bank’s leadership.
The governor’s action on behalf of a little known night club outside of his state caused controversy when it was first revealed by Delaware’s News Journal in 1978. At the time many speculated the link between James Biden and Shapp arose through Owens, an early supporter of the governor who even held a “patronage” job in his administration at one point. Politico echoed that line in August when highlighting James Biden’s history of receiving “unusually generous” loans throughout the 1970s.
Breitbart News, however, has learned that the links between Shapp and the Biden family led directly to Joe Biden, himself.
Before running for Congress, Joe Biden had few political ties outside of Delaware. After securing election to the Senate, that changed as Joe Biden began taking a keener interest in issues beyond his state, a move many believed signaled higher political ambitions. As such, Joe Biden set his sights on Pennsylvania, which apart from neighboring Delaware was also vital to the Democrat’s electoral college strategy. Over the years, Joe Biden’s advocacy for the Keystone State would earn him the moniker of “Pennsylvania’s third senator.”
Shapp, on the other hand, was a longstanding political operative before his election as governor in 1970. He cut his teeth on John F. Kennedy’s 1960 presidential campaign and by some accounts is believed to have inspired the idea behind the Peace Corps. After Kennedy’s election, Shapp served as an advisor to the new administration before making an unsuccessful bid for governor in 1966.
Although it is unknown when or how Joe Biden and Shapp became acquainted, the two were strong political allies dating as far back as 1974. That year, Joe Biden barnstormed Pennsylvania for Shapp’s reelection campaign. During one particularly notable rally in Scranton, Pennsylvania, Joe Biden praised the governor for his “innovative” and “tough leadership,” particularly in settling labor disputes throughout the state.
The following year, when Shapp’s office was recommending James Biden to First Pennsylvania, Joe Biden was touting the governor for president.
“I consider Milton Shapp as one of the most qualified men to be president of the United States and I have no trouble supporting him,” Joe Biden announced in July 1975.
The public display of support would not have drawn much attention, if not for its timing. Joe Biden’s endorsement was the first by any senator ahead of the 1976 election. It came even before the Democrat field was formed and weeks after Shapp launched his candidacy. Joe Biden’s backing was especially significant since the senator, himself, had been flirting with a presidential run, before bowing out in Shapp’s favor. The endorsement also helped boost the governor’s profile at a time he suffered from a self-acknowledged “identity problem” outside of Pennsylvania.
“The nation needs a man who will act, who can respond to the challenge of economic adversity,” Biden said when throwing his support behind the governor.
Left unsaid, though, was the fact that Shapp was helping James Biden overcome his own economic adversity. Shapp’s intervention with First Philadelphia in 1975, ensured James Biden’s night club was able to stave off bankruptcy. In fact, James Biden’s line of credit with First Pennsylvania would grow from $300,000 to more than $600,000, despite never having a net worth more than $10,000. The money, however, did not last long and James Biden was forced to surrender the club to creditors in 1977.
Shapp’s presidential ambitions fared no better. The governor’s campaign never got off the ground, suffering from both poor fundraising and name recognition. He eventually opted to withdraw from the race after garnering less than three percent in Florida’s Democrat primary.
Joe Biden’s ties to Shapp come back into the spotlight as the former vice president struggles to answer questions over son’s and brother’s business dealings.
Most notably, Hunter Biden’s tenure on the board of directors of Burisma Holdings, a Ukrainian natural gas company, is at the center of impeachment inquiry into President Donald Trump. The controversy started when Trump suggested the Ukrainian government investigate how Hunter Biden secured an appointment, which paid as much as $83,000 per month, to Burisma’s board, despite no background in either eastern Europe or the energy sector.
At the time of the appointment, Joe Biden was leading the Obama administration’s policy towards Ukraine. Complicating matters is that Joe Biden pressured Ukraine to fire its top prosecutor, who was investigating Burisma for public corruption, in 2016 under threat of losing more than $1 billion in U.S. aid.
James Biden, meanwhile, is being sued for defrauding a rural health care company in Tennessee and has allegedly leveraged the former vice president’s cancer initiative to promote his business interests.
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