[Congressional Record Volume 141, Number 137 (Wednesday, September 6, 1995)]
[House]
[Pages H8579-H8582]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




               JUDGE HENRY WOODS AND THE WHITEWATER CASE

  The SPEAKER pro tempore. Under a previous order of the House, the 
gentleman from Indiana [Mr. Burton] is recognized for 5 minutes.
  Mr. BURTON of Indiana. Mr. Speaker, about 4 or 5 weeks ago I took a 
special order talking about a judge in Arkansas, in Little Rock, a 
Federal judge who has close political ties to the current Governor, Jim 
Guy Tucker, and President Clinton, and particularly the First Lady, 
Hillary Rodham Clinton. Judge Henry Woods has been a longtime political 
adviser to the President and to Mrs. Clinton. He has appointed her to a 
number of boards. He recently was given a case involving the current 
Governor, Jim Guy Tucker, which was brought to his attention and put 
before his court by Mr. Starr, who is investigating the Whitewater 
matter and other related matters.
  At that time, when I had my special order. I suggested that in order 
to eliminate any appearance of impropriety, Judge Henry Woods should 
recuse himself and not be the judge to hear this case, because no 
matter what he did, if he rendered a decision in favor of Mr. Tucker, 
Governor Tucker, it would have the appearance of impropriety.
  One of the other judges down there in a related case dealing with 
Webb Hubbell, who was indicated and convicted, you remember Webb 
Hubbell, he was the Assistant Attorney General appointed by President 
Clinton, did recuse himself. He did it because he felt like the 
appearance of impropriety was something that should not even be 
considered by a Federal judge.
  I urged during my special order that Judge Henry Woods recuse 
himself, as the other Federal judge did in a related case, but Judge 
Henry Woods did not do that. This week it was announced that he 
dismissed one of the indictable offenses against Governor Jim Guy 
Tucker, and it certainly does give the appearance of impropriety 
because of this connection with Jim Guy Tucker and the people who are 
currently residing in the White House, as well as other Democrat 
leaders throughout Arkansas.
  Tonight I would like to submit for the Record, Mr. Speaker, all of 
the information I have regarding Judge Henry Woods, my previous special 
order, an article that was written by a person from little Rock who 
served in the Arkansas State Senate with Judge Henry Woods when he was 
in the Senate, and I would like for
 all of these articles to be included in the Congressional Record so at 
some future date, if Judge Henry Woods renders decisions that are of 
concern to Members of the House, there will be a record in the 
Congressional Record.

  Mr. Speaker, I would also like to say to all who are on the Committee 
on Government Reform and Oversight that we ought to have a complete and 
thorough hearing on the Whitewater case and all the related cases, 
including the one currently pending before the courts involving Jim Guy 
Tucker, the Governor of Arkansas, I think there is so much that appears 
to be collusion down there that it boggles the mind. For Judge Henry 
Woods to participate and render the decision he did last week regarding 
Jim Guy Tucker is just beyond comprehension.
  As a matter of fact, I would like to just read one thing that was 
said in the newspaper article which I think was put in the paper today. 
``It's typical hometown anger at the Feds coming in,'' says James 
Madison University political science professor Robert Roberts. ``But if 
it hadn't been for Federal prosecutors, the level of scandal at the 
local and State level would be 10 times greater than it is today,'' 
Roberts predicted. This is the part I want to put in the Congressional 
Record. In particular, ``Roberts predicted Starr would win on appeal,'' 
that is the decision by Judge Henry Woods he is going to appeal, that 
``Roberts predicted Starr would win on appeal because of the long 
tradition of granting independent counsels widespread discretion. This 
is nothing for President Clinton to cheer about,'' says Roberts. ``He 
is best served by letting the investigation run its course quickly, and 
this just delays things.''
  I submit to my colleagues here in the House that the reason for this 
delay is because of the close personal relationship Judge Henry Woods 
has with First Lady Hillary Rodham Clinton and other people in the Jim 
Guy Tucker administration. It is unfortunate this happened. It should 
not have happened. He should have recused himself.
  The material referred to follows:

                          [From the USA TODAY]

                     Independent Counsel Challenged

                            (By Tony Mauro)

       A Little Rock federal judge's decision Tuesday to dismiss 
     fraud indictment against Arkansas Gov. Jim Guy Tucker marks 
     the first time the broad powers of an independent counsel 
     have been trimmed.
       U.S. District Judge Henry Woods said Whitewater independent 
     counsel Kenneth Starr overstepped his authority in June by 
     indicting Tucker of fraud charges related to a federal loan 
     to finance a cable TV venture.
       Starr contends the judge has no authority to rule on the 
     scope of the investigation, which was launched to look into 
     irregularities relating to the Whitewater real estate venture 
     in which President Clinton and Hillary Rodham Clinton were 
     partners.
       ``I cannot accept the proposition that . . . no court has 
     the power to determine where there is jurisdiction to proceed 
     in the matter,'' wrote Woods, a 1979 Carter appointee.
       Starr promptly announced he would seek an expedited review 
     by a federal appeals court in St. Louis.
       Tucker still faces an 11-count indictment stemming from 
     dealings with Madison Guaranty Savings & Loan, which was 
     owned by the Clintons' Whitewater partners, James and Susan 
     McDougal. They also have been indicted.
       The ruling comes amid debate over the power of independent 
     counsels, a hybrid breed of prosecutors created by a post-
     Watergate federal law in 1978.
       Independent counsels are appointed by a three-judge panel 
     at the request of the attorney general when a high-level 
     official is suspected of violating federal law.
       Originally viewed as properly insulated from political 
     influence, critics now say 

[[Page H 8580]]
     independent counsels are too insulated--politically unaccountable and 
     prone to lengthy fishing expeditions that go far beyond the 
     original allegations.
       ``The logic of the law is to sweep in more and more 
     potential cases, things the Justice Department would not have 
     punished,'' says former Justice Department official Terry 
     Eastland, who wrote a book on independent counsels. ``It 
     becomes a very messy business and it's bad for the system.''
       Starr, a former Republican administration official, came 
     under attack in Arkansas and in the White House for straying 
     beyond Whitewater and reviewing every political transaction 
     in recent Arkansas political history.
       ``It's typical hometown anger at the feds coming in,'' says 
     James Madison University political science professor Robert 
     Roberts. ``But if it hadn't been for federal prosecutors, the 
     level of scandal at the local and state level would be 10 
     times greater than it is today.''
       Roberts predicted Starr would win on appeal because of the 
     long tradition of granting independent counsels wide 
     discretion.
       ``This is nothing for President Clinton to cheer about,'' 
     says Roberts. ``He is best-served by letting the 
     investigation run its course quickly, and this just delays 
     things.''
                                                                    ____

               [From the Washington Post, Sept. 6, 1995]
             One Whitewater Indictment of Tucker Dismissed


Federal Judge Rules Independent Counsel Starr Exceeded His Authority in 
                                Tax Case

                           (By Susan Schmidt)

       A federal judge yesterday dismissed one of two indictments 
     against Arkansas Gov. Jim Guy Tucker on grounds that the 
     prosecutor, Whitewater independent counsel Kenneth W. Starr, 
     exceeded his authority in bringing the case.
       U.S. District Judge Henry Woods threw out a June tax fraud 
     and conspiracy indictment of Tucker and two other men 
     involved with him in a cable television venture, saying the 
     case ``bears no relation whatsoever'' to the questions Starr 
     was charged with investigating. A second bank fraud 
     indictment of Tucker, handed up last month, still stands.
       Tucker has not sought dismissal of that indictment, which 
     relates more directly to the Whitewater investigation. That 
     case is being handled by a different judge.
       The 21-page ruling, issued after 1\1/2\ hours of oral 
     arguments, touches on the controversial question of how broad 
     a special prosecutor's authority should be in pursuing 
     evidence not directly connected to the central theme of an 
     investigation.
       Objections to broad inquires have been raised in other 
     independent counsel investigations, including the probe of 
     former agriculture secretary Mike Espy.
       Woods agreed with Tucker's lawyers that the allegations had 
     nothing to do with the independent counsel's mandate to 
     investigate the interrelationships between two defunct 
     Arkansas lending institutions and the two couples who owned 
     the Whitewater Development Corp.--Bill and Hillary Rodham 
     Clinton and James B. and Susan McDougal.
       It was not enough, the judge said, that Starr 
     ``fortuitously stumbled across the defendants' alleged 
     violation of law.'' The authority to bring charges against 
     Tucker rested with the Justice Department, he said.
       The issues raised in the tax fraud indictment ``were not 
     related in any way to the investigation of Whitewater,'' said 
     Tucker's lawyer, William H. Sutton. ``We felt the independent 
     counsel legislation was very special, applicable to a defined 
     set of people, primarily high officials in the federal 
     government.''
       Starr said his office will seek an expedited appeal of 
     Woods's ruling before the 8th U.S. Circuit Court of Appeals 
     and then the Supreme Court, if necessary.
       Appearing before Woods in Little Rock yesterday morning, 
     Starr argued that his evidence against Tucker was 
     sufficiently related to the main areas of his investigation 
     to justify his bringing an indictment.
       Even if Woods did not agree, Starr said, the judge did not 
     have the authority to limit the powers of an independent 
     counsel's activity.
       The scope of such a probe has never been successfully 
     challenged ``since Watergate, since the scandals that gave 
     rise to the Ethics in Government Act'' under which he was 
     appointed, he said. Attorney General Janet Reno filed a court 
     brief in support of Starr's position.
       But Woods disagreed. ``I cannot accept the proposition that 
     a citizen can be put on trial in my court for a loss of his 
     liberty, and that no court has the power to determine whether 
     there is jurisdiction to proceed in the matter,'' he wrote. 
     ``Surely the independent counsel and attorney general do not 
     suggest that there can be no judicial review of prosecutorial 
     jurisdiction of an independent counsel. . . . Such a 
     precedent would be both novel and dangerous.''
       Starr had argued that one of the elements of the June 
     indictment stemmed from a business deal between Tucker and 
     David Hale, owner of Capital Management Services, which Starr 
     is investigating along with McDougal's savings and loan 
     association, Madison Guaranty.
       Starr said the second Tucker indictment shows that the 
     crimes alleged in the June indictment were directly tied to 
     Capital Management and to Madison.
       Tucker was accused in the dismissed indictment of 
     falsifying a loan application to Capital Management, a 
     company funded by the federal Small Business Administration 
     to make loans to disadvantaged businesses.
       He allegedly used the money he borrowed from Capital 
     Management to help purchase a cable television company, then 
     sold the company and allegedly conspired to avoid paying 
     several million dollars in federal taxes.
       Tucker has not sought a dismissal of the second 21-count 
     indictment, in which James and Susan McDougal are also named 
     as defendants. The three are accused of engineering financing 
     for millions of dollars in allegedly phony real estate 
     transactions through Madison and Capital Management.
       Tucker, a Democrat, has complained that he is being made a 
     scapegoat in a politically motivated investigation, and he 
     has made much of Starr's Republican background.
       Even if Woods's ruling is overturned, it will delay by many 
     months Tucker's trial on the first set of charges, pushing it 
     well into next year. If Tucker prevails on appeal, Starr 
     would turn the case over to the attorney general for 
     prosecution.
       Woods, appointed to the federal bench by President Jimmy 
     Carter, has had a long-standing professional relationship 
     with Hillary Clinton who practiced law in Arkansas until her 
     husband was elected president.
       Woods wrote to late deputy White House counsel Vincent W. 
     Foster Jr. in June 1993 to ask whether he should grant an 
     interview to a reporter from Mother Jones magazine who was 
     preparing an article on Hillary Clinton.
       In a written inquiry to Woods, the reporter said she wanted 
     to interview him because he had appointed Hillary Clinton to 
     a trial advocacy panel early in her career and later to the 
     committee on the Little Rock school desegregation case.
       ``Would you take this up with Hillary or her press 
     secretary and give me instructions as to whether this 
     interview should be granted?'' Woods asked Foster.
       Woods's letter to Foster was turned over to congressional 
     investigators by the White House.
                                                                    ____

                          Who Is Henry Woods?

       Last year, the President was reminiscing with Connie Bruck 
     of The New Yorker about his 1990 gubernatorial race. At one 
     point, he said, he was undecided about running and an 
     influential Arkansan came up with a substitute: Hillary 
     Clinton. The powerful member of the Arkansas political family 
     ``desperately wanted her to run for governor,'' the President 
     told Ms. Bruck, ``and it got out and around the state.''
       That gentleman was Judge Henry Woods of the U.S. District 
     Court for the Eastern District of Arkansas. ``Henry,'' a 
     friend of the judge told Ms. Bruck, ``just hangs the moon on 
     Hillary.'' Judge Woods has contributed 15 years of 
     distinguished service to the judiciary, particularly in the 
     long-running Little Rock school desegregation cases. At a 
     critical point in 1987, Judge Woods named Mrs. Clinton 
     counsel to a citizens' committee working for racial balance 
     in the schools. ``I called on Hillary a lot,'' he told Ms. 
     Bruck. ``She was not just functioning as advisor to the 
     committee.''

                           *   *   *   *   *

       Gov. Tucker has angrily declared his innocence and says he 
     may challenge Independent Counsel Kenneth Starr's 
     jurisdiction. ``None of the allegations,'' Gov. Tucker said, 
     ``involve President Clinton, Mrs. Clinton or any other person 
     in the executive branch that the regular U.S. Attorneys would 
     have had a conflict in prosecuting.'' As we have noted in 
     regard to the Clintons, this is correct in a narrow sense; 
     but it is also true that the indictments and guilty pleas so 
     far obtained by Mr. Starr paint a disturbing picture of the 
     political and business landscape from which the President and 
     First Lady emerged.
       Understandably, for example, Gov. Tucker would have 
     preferred that ``the regular U.S. Attorney'' handle his case. 
     That would be Paula Casey, the long-time Friend of Bill who 
     first received criminal referrals from the Resolution Trust 
     Corp. allegedly naming the Clintons and Mr. Tucker. After 
     making some crucial decisions, Ms. Casey belatedly recused 
     herself from
      the Madison Guaranty case, in November 1993, in the midst of 
     a six-week period which saw Treasury contacts with the 
     White House, Bruce Lindsey informing the President about 
     the referrals, two Clinton Tucker meetings, and Associate 
     Attorney General Webster Hubbell's own recusal from 
     Whitewater matters.
       The problem, of course, is that everyone from the Arkansas 
     political culture comes from the Arkansas political culture. 
     When it come time for Mr. Hubbell to plead guilty to a scheme 
     to defraud the government and his former partners at the Rose 
     Law Firm, he stood before U.S. District Court Judge William 
     Wilson in Little Rock. Two days after the plea, Judge Wilson 
     stepped down from the case, saying his contacts with the 
     Clintons over the years might be misconstrued. ``Not only 
     must you do justice,'' Judge Wilson said, ``you must have an 
     appearance of doing justice.''
       Naturally Judge Woods has the same sort of associations. 
     Now 77, he was for some 40 years a close associate of 
     Arkansas financier and legislator Will Stephens--head of the 
     Stephens Inc. investment giant until his death in 1991. *  *  
     * Mr. Woods later fought segregationist Gov. Orval Faubus and 
     was a supporter of current Sen. Dale Bumpers and Rep. Ray 
     Thornton, among others. Messrs. Clinton, Tucker, Hale, and 
     James McDougal of Madison Guaranty fame all got their early 
     political education from one of the towering 

[[Page H 8581]]
     figures in Arkansas politics, former Sen. William Fulbright. It's a 
     tight, if sometimes feuding, family.
       Mr. Woods actively supported Mr. Bumpers' 1970 
     gubernatorial run. In 1974, Gov. Bumpers knocked Sen. 
     Fulbright out of the Democratic primary and went on to the 
     Senate; Mr. Fulbright went to work for the Saudis and 
     Stephens Inc. In 1978, Mr. Woods supported Mr. Stephens' 
     nephew. Mr. Thornton, in a three way primary race against 
     then U.S. Rep. Tucker and David Pryor for the Democratic 
     nomination to the Senate President Carter nominated Mr. Woods 
     to the federal bench in 1979; when he was sworn in, Gov. 
     Clinton saluted him, saying he was a man who would ``feel the 
     pain'' of the people.
       The defendant to the contrary, the Tucker case is not just 
     another case, but one pregnant with implications for the 
     President, the First Lady and the whole circle of the judge's 
     friends and associates. Judge Woods can best honor his 
     distinguished record on the bench by following Judge Wilson's 
     example and stepping aside.
                                                                    ____

                webster hubbell and gov. jim guy tucker

  Mr. Speaker, I would like to talk today about the conviction of 
Webster Hubbell, the indictment of Gov. Jim Guy Tucker--both close 
friends of President Clinton--and the two Arkansas judges overseeing 
these cases.
  The judge in Webster Hubbell's case stepped aside because of his 
close ties to all of Arkansas' top Democrat politicians. The judge in 
Governor Tucker's case has made no move to recuse himself, even though 
many observers believe he has even more conflicts of interest.
  Mr. Speaker, about a month ago former Associate Attorney General 
Webster Hubbell was sentenced to 21 months in prison. On December 6, 
1994, Mr. Hubbell pled guilty to one count of mail fraud and one count 
of tax evasion to the independent counsel investigating Whitewater, 
Kenneth Starr. Last week, Mr. Hubbell, who a little more than a year 
ago was the Nation's third highest ranking law officer, testified 
before the Senate about the death of Vincent Foster and the 
obstructions of the investigation at the White House.
  I would like to talk for a moment about Webster Hubbell. He is often 
characterized in the media as the President's frequent golfing partner. 
But he is much more than that.
  Mr. Hubbell was a partner along with Hillary Clinton, William Kennedy 
III, and the late Vincent Foster at Little Rock's powerful Rose law 
firm. In fact, Mr. Hubbell served as the firm's managing partner. He 
also served as mayor of Little Rock, and was appointed by then-Governor 
Bill Clinton as interim chief justice of the Arkansas State Supreme 
Court.
  He came to Washington with the Clintons after the 1992 election and, 
in the opinion of many Washington insiders, ran the Justice Department 
until Janet Reno was confirmed by the Senate. Mr. Hubbell resigned as 
Associate Attorney General in March 1994, after his former partners at 
the Rose law firm began to investigate him for overbilling some of his 
clients, including the Federal Government for work done in a case 
against the auditors of Madison Guaranty Savings and Loan. Now, like 
many of the President's friends from Arkansas, Mr. Hubbell has left the 
Government in disgrace and legal trouble.
  On June 23, 1995, Mr. Hubbell asked the judge presiding over his case 
for leniency, stating that he had made proper restitution to his former 
firm. Under the sentencing guidelines, Mr. Hubbell was required to 
serve a mandatory minimum sentence unless the independent counsel asked 
the presiding judge for leniency. Mr. Starr replied to Mr. Hubbell's 
request by stating that he had no intention to ask for leniency.
  The fact that Mr. Starr had no intention of asking for the court to 
be lenient with Mr. Hubbell leads us to believe that Hubbell did little 
to help Starr's investigation.
  After he left the Justice Department, Hubbell landed a new job at G. 
William Miller and Co., the law firm of Michael Cardozo. Cardozo is the 
former Clinton Justice Department official who handles the Clintons' 
legal defense fund. He became notable in the summer of 1993 because he 
spent the entire weekend with Vincent Foster 3 days before Foster's 
death. Webster Hubbell and Michael Cardozo spent the weekend at the 
Eastern Shore secluded with Mr. Foster and his wife. Both have claimed 
that Foster did not seem unusually depressed, even though investigators 
have cited Foster's depression as the reason for his suicide 3 days 
later.
  And somehow, Mr. Hubbell's wife was offered a job at the Interior 
Department after Mr. Hubbell entered his plea. We now know that Mrs. 
Hubbell's hiring was orchestrated by talks between the White House and 
the Interior Department. Since Mr. Hubbell and his wife were both being 
employed by their friends, many people wonder whether he cooperated 
with the Starr probe as much as he might have.
  The judge originally assigned to preside over the Hubbell case was 
one William Wilson in Little Rock. However, as is so often the case 
among the political and social elite of Arkansas, Judge Wilson had 
close associations with Bill and Hillary Clinton, and before becoming a 
judge was very active in the Arkansas Democrat Party. Judge Wilson 
realized the possible conflict of interest, and 2 days after Mr. 
Hubbell's guilty plea he recused himself from the case. In doing so, 
Judge Wilson stated, ``Not only must you do justice, you must have an 
appearance of doing justice.'' I take that quote from an editorial in 
the June 21, 1995 edition of the Wall Street Journal and ask that this 
editorial be entered into the Record.
  This editorial raises an interesting question, because we are 
awaiting the trail of Bill Clinton's successor as Governor of Arkansas, 
Jim Guy Tucker. On June 7, 1995, Governor Tucker and two associates 
were indicted by a Federal grand jury in Little Rock. Governor Tucker 
was indicted for fraudulently obtaining a federally-backed small 
business loan and evading taxes and is facing up to 12 years in prison 
if convicted.
  On October 6, 1993, Jim Guy Tucker and President Bill Clinton met 
privately at the White House. About a week before this meeting, White 
House counsel, Bernard Nussbaum, and White House advisor, Bruce 
Lindsey, and other top administration officials were informed of the 
fact that the Resolution Trust Corporation had forwarded criminal 
referrals regarding Madison Guaranty Savings and Loan to the Justice 
Department. These criminal referrals named not only Bill and Hillary 
Clinton but also Jim Guy Tucker.
  The White House has stated that President Clinton and Governor Tucker 
never discussed these criminal referrals, neither at the White House 
meeting nor at a later meeting in Seattle. But we have no way of 
knowing. That is why so many people are so concerned about the many 
improper contacts between the White House staff and the Treasury 
Department.
  The judge assigned to preside over the Tucker case is Judge Henry 
Woods. For some background on Woods I refer my colleagues to the Wall 
Street Journal editorial I quoted earlier, as well as a column by 
former elected Arkansas Supreme Court Justice Jim Johnson that ran in 
the June 23, 1995, edition of the Washington Times. I ask that these 
articles be entered into the Record.
  Judge Woods is a longtime member of the Arkansas political elite. He 
is a major power broker in the Arkansas Democrat Party. He served as 
chief assistant to Democratic Governor Sid McMath. He freely admits 
that he is good friends with Bill and Hillary Clinton. Judge Woods 
named Mrs. Clinton to a State panel to work toward racial balance in 
schools. Woods and McMath later went on to form a law partnership, 
McMath, Leatherman and Woods.
 McMath's son, Sandy McMath, a member of the law firm, was an 
instrumental leader in the early political campaigns of Jim Guy Tucker. 
So even if Judge Woods and Governor Tucker are not the best of friends, 
they are undoubtedly members of the same tightly knit network from 
which Bill Clinton emerged.

  In the Webster Hubbell case, Judge Wilson realized immediately that 
he had no business trying the case. Even if he could have been 
completely objective, many people would still question what they saw as 
the appearance of a conflict. In the Jim Guy Tucker case, Judge Woods 
has given us no indication that he intends to recuse himself, despite 
his multiple potential conflicts of interest. With Judge Woods, the 
conflict of interest is more than just an appearance. it is a very 
serious matter.


                               questions

  If Jim Guy Tuckers's attorneys move to throw out the indictments 
claiming that Kenneth Starr has exceeded his jurisdiction, would Judge 
Woods' many ties to the State Democrat Party color his decision?
  What other connections exist between Judge Woods and Governor Tucker 
that we do not know about?
  With Judge Wilson's recusal due to possible conflicts of interest in 
the Hubbell case, is it not in Judge Woods' best interest, after a long 
and illustrious career, to follow his example and recuse himself?
  What did Jim Guy Tucker and Bill Clinton talk about at their meeting 
at the White House in 1993? How can we ever know for sure whether or 
not they shared confidential information about the RTC criminal 
referrals that had been revealed to the White House?
  What did Jim Guy Tucker and Bill Clinton talk about in their meeting 
in Seattle?
  David Hale.--When Jim Guy was indicted, the media were quick to 
proclaim that the indictment was not connected in any way to Bill and 
Hillary Clinton. But this is not the case. The charges brought by the 
independent counsel against Governor Tucker are the direct result of 
testimony and documentary evidence provided by Judge David Hale.
  Judge Hale is the same man who has accused the President of 
pressuring him to approve an illegal loan in 1986 to obtain funds to 
help the failing Madison Guaranty Savings and Loan.

[[Page H 8582]]

  Judge Hale pled guilty to defrauding the Small Business 
Administration. He has testified to a Federal grand jury that he was 
pressured by Gov. Bill Clinton and his Whitewater partner, James 
McDougal, and by Jim Guy Tucker, to provide an illegal $300,000 loan to 
McDougal's wife, Susan McDougal. This loan was never repaid, and more 
than $100,000 of the loan reportedly ended up in Whitewater Development 
Company's account.
  The day after the Tucker indictment, Mr. Starr secured a guilty plea 
from Stephen A. Smith, who was one of Bill Clinton's top aides during 
his first term as Arkansas Governor. Smith pleaded guilty to defrauding 
the Small Business Administration, lying to obtain $65,000 from David 
Hale's lending agency, Capital-Management Services.
  The indictment of Jim Guy Tucker and the guilty plea of Stephen Smith 
show us that the grand jury--made up, incidentally, of normal citizens 
of Arkansas, not a bunch of right-wing Clinton critics is looking 
closely at the documents and listening very carefully to the testimony 
offered by David Hale. The actions taken by Mr. Starr tell us that both 
the independent counsel's office and the grand jury consider David Hale 
a credible witness.


                          ____________________