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A Gourmet's Guide to the Campaign Finance Stew

By Elizabeth Drew
Sunday, March 23, 1997; Page C01


The cascade of news stories about campaign finance scandals has left much of the public confused about the main question: What really matters? It's important to distinguish the simply tacky from the extremely tacky from the truly offensive, the ethically questionable from the possibly illegal from the flat-out wrong. But these categories don't necessarily represent ascending gradations of objectionable behavior. In the hall of mirrors known as campaign finance, seemingly illegal acts are sometimes less deplorable than something that's perfectly legal.

As Washington scandals go, this one seems to have staying power. It's not as serious as Watergate, nor is it likely to be. But it is growing almost as rich in texture and it, too, has its serio-comic aspects, with strange characters who suddenly pop up from nowhere. It keeps unfolding, leaving us to wonder what's coming next and whether it will take the Clinton administration further downhill. Based on what we know at this point, and by studying the available documents, here are the ratings on the seriousness scale thus far.

Tacky, But Legal

If you take the president at his word that the sleepovers in the Lincoln Bedroom involved no solicitations for campaign contributions, his slumber parties fall into the category of tacky, but probably not unethical and certainly not illegal. The president should be able to invite whomever he wants to stay at the White House. That's his privilege. Clinton has defended himself by saying that the bulk of his guests were friends and longtime supporters, as if that somehow takes care of any question about the others.

What makes the sleepovers particularly tacky is that it's clear from the president's handwritten notes, on a memo from his campaign staff about raising money for his re-election, that he thought of house guests as a fund-raising tool. When the list of people who have stayed at the White House during the Clinton years was released, the president's aides invented a new category of friendship: People who were "not friends yet."

Clinton's sometimes blatant use of the Lincoln Bedroom to loosen up wealthy potential donors has turned this historic room (even if Lincoln didn't sleep there) into a national joke. The degradation of a national shrine is of no small moment.

Offensive and Questionable

The White House coffees, where President Clinton met with contributors and favor seekers, go beyond tacky. They come under the category of ethically suspect – and perhaps legally questionable, if access to the president was promised, or clearly indicated, in exchange for a donation. Such a promise might meet the legal standard of "any benefit," which the criminal code says may not be "made possible. . . as consideration, favor, or reward for any political activity or for the support of . . . any candidate or any political party in connection with any election."

Citing this provision, the citizens' lobbying group Common Cause has asked the Justice Department for an investigation of the circumstances under which Thai-born businesswoman Pauline Kanchanalak, an American resident who has interests in China, met with the president for coffee on June 18 last year. She brought along five associates for what press reports described as a meeting about "U.S. policy toward China." Three Democratic National Committee officials also came along – then DNC chairman Donald Fowler, DNC finance chair Marvin Rosen and John Huang, the DNC's assiduous fund-raiser. That same day, Kanchanalak contributed $85,000 to the DNC.

The Kanchanalak sort of coffee is a serious matter, offensive even if legal. The White House has insisted that no switch in administration policy came from any of these meetings. Even if this is the case, the meetings yielded at least one important benefit for the coffee drinkers/donors – Clinton's time, one of the scarcest resources there is. That the coffees were an intrusion on the president's crowded schedule is evident in a memo that then Deputy Chief of Staff Evelyn Lieberman wrote to then Chief of Staff Leon Panetta. She said that to make time for the coffees, staff briefings of the president "may be considerably truncated or eliminated."

The president has said no solicitation occurred at the coffees. But does that distinction matter if, as occurred, the DNC hit up some coffee attendees for $50,000 the day before, later that same day or the next day?

Moreover, what is the legal or moral difference between selling a seat at a coffee in the White House or selling one at a fund-raising dinner with the president across the street at the Hay-Adams? How do these differ from the many events at which access to important members of Congress is purchased? They're all unethical in that access is being auctioned off to the wealthiest among us. But common sense would make distinctions between an intimate setting where one can talk policy with the president and larger gatherings where there is less opportunity for a policy discussion. There is – or used to be – something special about the White House, and the president occupies a different place in the political firmament than congressional leaders do.

Possibly Illegal but No Big Deal

Vice President Gore's phone solicitations from his office prompted much discussion about whether the calls violated the law that prohibits fund-raising on federal property. But what were Gore's alternatives? Does he motor over to the DNC's office, stand in a phone booth on Pennsylvania Avenue, or go home whenever he wants to make a fund-raising call? (The Justice Department, during the Carter administration, conveniently declared the president's living quarters "private" and therefore not covered by this law. That would presumably cover the vice president's residence, too.)

On Capitol Hill, it has long been the ethos that the lawmaker doesn't solicit from his office. Many troop over to their party's headquarters to make such calls. One senator would leave his office, get in his car and drive around the Capitol using his cell phone to solicit contributions. Is that substantively different than doing it from his office? Sen. Orrin Hatch (R-Utah) said on television recently that if someone offers him a campaign check in his office, he has his political aide walk the benefactor out of the building and accept the check on the sidewalk. What real difference does that make?

Seriously Troubling

The real problem with Gore's fund-raising calls – as with the president's coffees – is not where they took place but that the country's two highest elected officials were participating in a kind of shakedown. It's a lot harder to turn aside a direct solicitation from the vice president than to reject an overture from a designated hitter-upper. (Clinton says he doesn't like to make such calls but he also said he couldn't say with certainty that he had never done so in the past four years.)

Of course, shakedowns occur on Capitol Hill as well. The Republicans were beyond brazen when, after winning control of the House in the 1994 election, they threatened PACs and lobbyists with a lack of access if they didn't donate more funds to the GOP and hire more Republicans for their firms.

Over the Line

The number of unsavory characters who made it into an intimate White House setting with the president certainly fits the definition of supremely tacky and unethical – but also merits its own category of deeply disturbing. How did a Chinese arms merchant, a convicted felon, and a Chinese American "hustler" with business interests in China (according to the National Security Council) get such proximity to the president? How did John Huang, the Lippo Group employee turned Commerce Department official turned DNC fund-raiser (while holding onto his mysterious security clearance), Johnny Chung (the "hustler"), and Kanchanalak get into the White House so often – 78, 26 and 49 times respectively?

That the Lippo Group – in the person of the president's friend James Riady – provided unspecified work for a large sum to Webster Hubbell, the former Justice Department official and Hillary Clinton law partner, has aroused the interest of the independent counsel investigating Whitewater. The counsel is looking into the possibility that this arrangement, and perhaps others, were made to keep Hubbell quiet about Whitewater. If there's any truth to this allegation, that would conjoin the two scandals and would be big-time trouble for the Clintons.

And now we have the tale of Roger Tamraz, the Lebanese American financier and major Democratic donor who was seeking Clinton administration backing for his plan to build an oil pipeline from the Caspian Sea to the Mediterranean. An NSC official decided Tamraz was trouble and tried to shut off his access to the White House. But the DNC interceded and the generous Tamraz ($177,000 to the Democratic cause) attended four White House gatherings.

It isn't easy – and it shouldn't be – to get near the president, and no one without a permanent pass can mosey into the White House unless approved by someone on the White House staff. Who cleared these people in?

Having been around the White House a fair amount, it seemed inconceivable to me that the president would meet with people without being briefed about them first – although White House aides insist he wasn't. And it turns out that the president was briefed for at least some coffees. In looking through the papers of former Deputy Chief of Staff Harold Ickes, released several weeks ago after a congressional committee asked for them, I came across two sets of three pages each of fairly detailed biographies – in the form of a memo to the president – of people who were coming for coffee. It would be most interesting to see the equivalent material for coffees attended by some of the unsavories.

Finally, there's the question of whether people with business ties to China used cash, and perhaps laundered money, to influence U.S. politicians. If there was such effort, and if in panic and/or recklessness the Clinton administration or the DNC knowingly allowed foreign money to flow into the campaign, that is serious business indeed. We still don't know why a low-level FBI briefing of the NSC staff on such Chinese efforts didn't make it to the top levels of the White House. Nor do we know what use – if any – John Huang made of his security clearance. All this has the makings of a major scandal.

But even if there were no China scandal, what went on in the White House, at the DNC, and in the selling of access by both political parties is serious enough. The fix for most of what went wrong is disconcertingly simple: eliminate soft money, the unlimited flow of funds from individuals, corporations and unions to the political parties for so-called "party-building activities." Soft money is the monster devouring our political system.

The reforms enacted after Watergate were largely effective at the beginning, putting strict limits on contributions. Then, in the late 1970s, the soft money loophole appeared, and kept on growing. It was soft money that the president and the vice president and the DNC, as well as the Republicans, were after in the last election. If soft money was prohibited, that would still leave members of Congress locked in an arms race for the "hard" dollars. But that can be fixed, too.

It is a commonplace in Washington these days that "the public isn't interested." It's as if no one here has ever seen public opinion move. The spectacle of politicians – in the White House and on Capitol Hill – playing their cynical games, protecting the system that got them where they are, is beyond tacky or unethical. It's a betrayal of the American public. The politicians may come to see that the voters care very much.

Elizabeth Drew has written extensively on campaign finance. Her next book, "Whatever It Takes: The Real Struggle for Political Power in America," will be published by Viking in May.


© Copyright 1997 The Washington Post Company

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