[Congressional Record Volume 140, Number 62 (Wednesday, May 18, 1994)]
[Extensions of Remarks]
[Page E]
From the Congressional Record Online through the Government Printing Office [www.gpo.gov]


[Congressional Record: May 18, 1994]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]

 
                            ARKANSAS SECRETS

                                 ______


                         HON. ROBERT K. DORNAN

                             of california

                    in the house of representatives

                        Wednesday, May 18, 1994

  Mr. DORNAN. Mr. Speaker, I commend to the attention of my colleagues 
an editorial from the March 31, 1994 edition of the New York Times 
concerning the President and Mrs. Clinton's financial histories.

               [From the New York Times, March 31, 1994]

                            Arkansas Secrets

       There will be plenty of time to explore whether laws were 
     violated when the Clintons went into the land development 
     business with James and Susan McDougal or when George 
     Stephanopoulos and other White House aides meddled with 
     Treasury Department investigations. For the moment, it is 
     enough to ponder the fluid morality implicit in the Clintons' 
     tax returns and the records of Mrs. Clinton's short but 
     profitable career as a commodities trader.
       The inescapable conclusion is that this couple, early and 
     late, suffered from a thematic insensitivity to the normal 
     rules of conflict of interest. At every turn of their 
     financial life, the then-governor and First Lady of Arkansas 
     were receiving financial favors from individuals who had 
     something to gain from having friends in high places.
       Consider the Whitewater case. The 230-acre development was 
     supposed to be a 50-50 partnership between the two couples. 
     To be clean politically, the deal had to be one of equal 
     investment and equal risk. But from the moment that Jeff 
     Gerth of The New York Times wrote the first Whitewater story 
     in 1992, 8 March, the Clinton campaign and later the White 
     House press office dodged questions and withheld documents.
       The reason is clear. The Clintons put up $500 initially and 
     claimed losses of $43,635, most of it in payments on loans, 
     by the time of the 1992 campaign. In contrast, the McDouglas 
     paid out $268,000 and withdrew $175,800 for a loss of 
     $92,200. Although the records are muddled, the McDougals 
     apparently paid dramatically larger amounts to support 
     Whitewater than did their supposedly equal partners, the 
     Clintons.
       Moreover, Mr. McDougal's heaviest contributions to the 
     partnership came after he acquired Madison Guaranty, a 
     savings and loan that was part of Mr. Clinton's regulatory 
     responsibility as Governor. The disorder of Whitewater and 
     Madison records is such that it is unknown whether the 
     Clintons benefited from any fund transfers between Madison 
     Guaranty and Whitwater Development, or whether Madison 
     benefited from favorable treatment by Mr. Clinton's 
     regulators. That is a legal determination, but the political 
     conclusion is clear. From the start of his governorship, Mr. 
     Clinton was involved in potentially compromising financial 
     entanglements.
       The same goes for Mrs. Clinton. On an initial investment of 
     $1,000 she made $98,000 by trading in agricultural 
     commodities while her husband was running for governor. Her 
     principal adviser was James Blair, the lawyer for Tyson 
     Industries; the broker he chose for her, Robert (Red) Bone, 
     had once worked for Tyson and had been disciplined by 
     regulators for not keeping good records on which accounts 
     made money and which lost. Once Mr. Clinton was in office, 
     Tyson received $9 million in state loans and very gentle 
     treatment when it came to the water pollution associated with 
     raising and cleaning chickens.
       The investigators are nowhere near the bottom of 
     Whitewater. But we now have a fairly clear idea of how it got 
     started and what it is about. It started with a well-meaning 
     young couple who seemed to have an extraordinary indifference 
     to, or difficulty in understanding, the normal divisions, 
     between government and personal interests. Their conduct may 
     not have been illegal, but it was reckless and politically 
     unattractive.
       To deal with these seedy appearances, Clinton supporters 
     are now engaged in what we have come to recognize as The 
     Arkansas Defense. A central argument is that while the 
     Clintons' dealings were not pretty, you cannot apply the 
     standards of the outside world to Arkansas, where a thousand 
     or so insiders run things in a loosey-goosey way that may 
     look unethical or even illegal to outsiders. This logic holds 
     that whatever the Clintons did was penny-ante stuff that the 
     Republicans and the press ought to be willing to overlook in 
     service to the higher national interests.
       Certainly, there is a national interest in a viable 
     Presidency and in swift progress on health care reform and 
     other pressing issues. But the genius of the Federal system 
     does not reside in importing to Washington the faults and 
     idiosyncracies of the state capitals.
       The effort to keep a lid on the Clinton's personal and 
     financial histories has led to the development of a 
     distinctive Clinton style--to withhod critical information 
     and to respond furiously with attacks on the motives of 
     critics. It is a viable campaign practice. But the clumsy 
     efforts to silence Congressional critics and the possible 
     White House interference with Federal agencies demonstrates 
     that it is a dangerous way to govern.

                          ____________________