Obama:

I am not freinds with Bill Ayres. He is just another guy in the neighborhood. "The notion that me knowing somebody who engaged in detestable acts 40 years ago, when I was 8 years old, somehow reflects on me and my values doesn't make much sense."

But:
Sen. Obama wrote a blurb for a 1997 Ayres book on the penal system. The book jacket mentioned Ayres' terrorist activities.

"Obama's review of Ayers' book says, "A searing and timely account of the juvenile court system, and the courageous individuals who rescue hope from despair

Michelle Obama chaired a panel for Ayers, and invited her husband to share the stage, to promote a program and a book by Ayers, to lower sentences and change court attitudes, toward juvenile offenders.

Ayers was an ex-officio board member and he and Obama worked closely, for years, between the Wood Fund and the CAC, to fund Ayers' pet projects, including Ayers' own Small School Project. Ayers' got lots of money for his own ideology. For 5 years Obama distributed over $100M with Ayers' help. The two of them decided who got funds and who didn't. They favored a heavily ethnic agenda, and when all the money was gone, they closed down. Annenberg's own report shows that NOTHING was achieved in the school - and indeed the money only went to external partners, to which schools had to try to attach themselves.

Ayers: Everything was absolutely ideal on the day I bombed the Pentagon. The sky was blue. The birds were singing. And the bastards were finally going to get what was coming to them.