WORLD

The Clinton cash machine

ANDREW PHILLIPS March 17 1997
WORLD

The Clinton cash machine

ANDREW PHILLIPS March 17 1997

The Clinton cash machine

WORLD

UNITED STATES

ANDREW PHILLIPS

Dick Morris was Bill Clinton’s necessary evil, his devil in a blue suit. When the President was at his political nadir following the Republican sweep of the U.S. Congress in 1994, he called his old friend Morris into the White House to mastermind his comeback. Never mind that Morris’s political morals were questionable (he worked for Democrats and Republicans with equal facility) and his personal morals were execrable (he was forced to quit last August when a tabloid revealed his affair with a $275-an-hour prostitute). He had worked out a formula to save Clinton by flooding the airwaves with political advertising for more than a year before November’s presidential election. That strategy came with a high price—both in money and in the President’s time as the | Democrats’ most powerful magnet 1 for attracting the tens of millions of | dollars needed to keep the ads run^ ning. Clinton’s plaintive lament 1 about the strain on him, his wife,

IN WASHINGTON

I can’t think. I can’t act. I can’t do anything but go to fund-raisers and shake hands. I can’t focus on a thing but the next fund-raiser. Hillary can’t, Al can’t—we’re all getting sick and crazy because of it.

—President Bill Clinton, quoted in Behind the Oval Office, by Dick Morris

Hillary, and Vice-President Al Gore would be revealing under any circumstances. Last week, with new revelations about the Democrats’ fund-raising machine coming thick and fast, it was especially telling.

The problem for the Democrats is that they were too successful for their own good. Morris’s strategy required so much money —$116 million for his TV ad campaign alone—that fund-raisers were under tremendous pressure to produce. By their own admission, Democrats accepted many dubious contributions. Gore, as documented last week in The Washington Post by Bob Woodward, whose reporting on the Watergate scandal in the 1970s helped to bring down president Richard Nixon, was the Democrats’ “solicitor-in-chief.” In an unusual role for an

Charges fly over campaign fund-raising

incumbent vice-president, Gore personally worked the phones to seek money from wealthy donors. More controversial, he placed the calls from his office in the White House—a possible violation of federal law. Hillary Rodham Clinton’s office was also dragged directly into the spreading scandal. Her chief of staff, Margaret Williams, acknowledged that she accepted a $50,000 (U.S.) cheque from a donor in the White House in 1995—another potential violation. More questionable still, the cheque was from a Taiwanese-American businessman, Johnny Chung, who two days later brought five Chinese officials into the White House to have their photos taken with Clinton.

All of that followed the release of documents showing that Clinton himself took a di-

rect, personal role in raising money—the kind of ceaseless activity that, by Morris’s account, eventually left him feeling “sick and crazy.” He fought back last week at a news conference—defending Gore and Williams, calling again for reform of U.S. laws governing campaign financing, saying he was “livid and stunned” to discover that the Democrats had not adequately checked where contributions were coming from, and denying that his administration had changed any policies to serve the interests of his party’s patrons. “I don’t believe you can find any evidence of the fact that I had changed government policy solely because of a contribution,” he said.

Clinton’s fund-raising woes may not reach the scale claimed by House Speaker Newt Gingrich, who labelled them a scandal “bigger than Watergate.” But they have taken on a life of their own. No fewer than five investigations are already under way in Washington. The justice department is looking into allegations that campaign laws were broken. The FBI is investigating claims that the Chinese government may have tried to buy influence in the White House and Congress by funnelling money to the Democrats through Asian-American companies and front organizations. In both houses of Congress, where Republicans are in the majority, politicians are manoeuvring to find best advantage out of the situation. Two Senate committees and

one committee of the House of Representatives plan hearings into campaign fund-raising. That alone will keep the controversy in the public eye for many weeks to come.

The revelations so far raise at least three main issues. The first is the simple propriety of collecting such vast amounts of money to feed the American political machine. Both Democrats and Republicans raised more cash than ever before for their 1996 campaigns. Much of that was in so-called soft money—funds raised for parties rather than individual candidates. There is no limit on how much soft money a party can collect, and the Republicans were better at it than the Democrats, pulling in some $200 million compared with $165 million for their rivals. Both parties continue to seek such funds from wealthy donors even as the Democrats’ fundraising scandal widens. In late February, for example, Republican leaders held a session for rich patrons at a luxury resort in Palm Beach, Fla., where Senate Majority Leader Trent Lott described political donations of $100,000 or more as “the American way.” For many critics of the system, that kind of ostentatious trading of vast amounts of

money for access to top politicians is the true scandal—though it is perfectly legal. Much of Clinton’s activity falls into that category. Under Morris’s re-election strategy, he endorsed plans to use access to him and Gore to reward wealthy donors. Documents given to congressional investigators by Harold Ickes, who was forced out of his job as deputy chief of staff to the President in January, show Clinton enthusiastically seconding proposals to offer coffee meetings, jogging or even rounds of golf with him if the donation was big enough. “Get other names at 100,000 or more, 50,000 or more,” he scribbled on a memo suggesting such an arrangement. Tellingly, he added: “Ready to start overnights right away.” That led to the parade of visitors sleeping in the famed Lincoln Bedroom and other parts of the White House residence—a total of 938 during his first term, many of them wealthy donors who gave sums ranging up to $550,000 to the Democrats. Clinton insists there was never a direct link between giving money and sleeping at the White House. So far at least, the practice appears to be legal—though unquestionably tacky. The second issue is whether any laws were broken. Gore defended his calls from the White House by noting that he made them on a credit card issued by his campaign organization. And in a phrase that immediately attracted ridicule as an example of lawyerly technicality, he said there was “no controlling legal authority” to establish that what he did violated the law. In Clinton’s case, he held his coffee sessions with supporters in the White House residence—so he would not break rules saying that federal offices cannot be used for partisan political purposes. But the most explosive issue may be whether foreign interests sought to exploit the Democrats’ eagerness for cash. The party has returned $4.1 million in improper contributions—and three-quarters of that money came from three men with intricate ties to Asian companies: Johnny Chung, John Huang and Charlie Yah Lin Trie. Chung, who handed the controversial $50,000 cheque to Hillary Clinton’s senior aide, visited the White House 51 times and has sought to turri his access to commercial advantage in Taiwan and China. That may be nothing more than an extension into Washington of the old Chinese practice of acquiring guanxi (connections) wherever possible. In a memo made public last week, a White House official described Chung as a “hustler” out only for his own enrichment. What investigators want to know is whether he is part of something more sinister: an effort by the Chinese government to acquire influence at the highest levels of U.S. politics by exploiting Clinton’s money lust. □