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Findings Link Clinton Allies to Chinese Intelligence (Feb. 10)

GOP Hits Gore on Temple Fund-Raiser (Feb. 10)

Excerpts from the draft of the Democratic report

'The White House, in Its Thirst for Money, Took Control' of DNC

Following are excerpts from the Republican majority report on the campaign finance hearings held last year by the Senate Governmental Affairs Committee:

The White House Controlled the [Democratic National Committee] and Improperly Coordinated the Activities of the DNC and Clinton/Gore '96.

"That was the other campaign that had problems with that, not mine," President Clinton, November 8, 1996.

In the wake of the President's re-election, questions were raised about allegations of improper fund-raising. The President's response was to shift blame away from himself (and his re-election campaign) to the DNC. This response was disingenuous. During the 1996 election cycle, the White House, in its thirst for money, took control of the DNC.

First, the White House took control of the DNC's finances, micro-managing how the DNC raised and spent money. Harold Ickes, Deputy Chief of Staff to the President, simply seized the reins of financial power at the DNC. The DNC could not spend any money without prior White House approval. Ickes also exerted direct control over the DNC's Finance Division, the division charged with fund-raising. DNC National Chairman Don Fowler was unsuccessful in contesting Ickes' assumption of power and asserting control over the DNC.

The White House's financial control of the DNC was designed to fund the advertising strategy developed by [former Clinton adviser] Dick Morris. Yet White House control was not limited to financial control of the DNC; using the DNC as an adjunct to the re-election campaign led to unprecedented coordination between the DNC, Clinton/Gore '96, and the White House over the content, placement, and production of advertisements. This unprecedented coordination violated the letter and spirit of existing federal campaign laws.

In short, the White House took control of the DNC, particularly its fund-raising apparatus, to squeeze as much money out of the DNC as it could. The purpose of this money was to fuel the White House's massive advertising campaign, which itself was the result of unprecedented illegal coordination. By the end of the campaign, any distinctions remaining between the White House, the DNC, and Clinton/Gore had been obliterated. . . .

The nation's oldest political party simply became an arm of the White House with the primary mission of re-electing the President. The illegalities and improprieties discussed in this report stem from this simple fact. The President's attempt to slough responsibility for illegal and improper fund-raising by the DNC in 1995-96 by pinning blame on 'the other campaign' rings hollow in the light of the facts uncovered by the Committee's investigation and outlined in this report."

The Hsi Lai Temple Fundraiser and Maria Hsia

. . . It has become apparent that the DNC's Hsi Lai Temple fund-raiser on April 29, 1996, was merely one instance – albeit the most significant one – in an ongoing campaign of illegal Temple donation-laundering arranged by a woman named Maria L. Hsia in support of Democratic candidates. Nor was this campaign merely an aberration confined to the 1995-96 election cycle. Rather, it had roots stretching back to 1988, with the decision of James Riady, John Huang, Maria Hsia, and others to organize themselves into a political fund-raising and lobbying organization in order to advance their interests in U.S. politics.

The Temple-related issue that has hitherto received the most attention in the press – Vice President Gore's knowledge (or alleged lack thereof) with regard to the status of his April 29 luncheon as a DNC fundraiser – is addressed in this section. It will be obvious from the evidence recounted herein that despite his various denials, the Vice President was well aware that the event was one designed to raise money for his party. Preoccupied by a narrow debate over the inconsequential terminology of "community outreach," "finance-related events," "donor maintenance," and "fund-raisers," many observers have missed the forest for the trees. The real significance of the Temple incident lies not in the Vice President's lack of candor, but in the ongoing relationship this affair illustrates between him – and the Democratic Party – and a small but influential political clique headed by Riady, Huang, and Hsia. . . .

[G]ore's trip to Asia and the Kiaoshung Monastery in Taiwan in 1989] was the start of an extremely close relationship between Hsia and Senator Gore. . . . Hsia became an active fund-raiser for the senator's reelection campaign. Over the next 22 months, until his reelection to the Senate in November 1990, for example, Hsia was involved with . . . numerous fund-raising events for the Gore campaign . . .

All of this fund-raising support was, of course, part of the rather explicit bargain Hsia had struck with Senator Gore in inviting him to visit Taiwan in November 1988. Hsia approached her political fund-raising with clear objectives in mind, and Senator Gore's presidential ambition appears to have been her most favored long-term prospect. As Hsia put it in a note to one DSCC contributor, whom she was at that point trying to persuade to "tally" an additional $5,000 to Friends of Al Gore, help for Senator Gore was important because he had been "willing to take the Lead role in travel to Asia and [was] willing to work with us on a long term relationship for his future presidency"

© Copyright 1998 The Washington Post Company

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