President Carter yesterday tried to close the door on the investigation into the personal financial affairs of his close friend and budget director, Bert Lance, calling Lance "a man of complete integrity" who enjoys "my complete confidence and support."
In a gesture designed to symbolize that support, the President flew by helicopter from Camp David, Md., yesterday afternoon to introduce Lance at a news conference concerning the comptroller of the currency's Lance investigation.
"My faith in the character and competence of Bert Lance has been reconfirmed," Carter said. "I see no other conclusion that can be drawn from my objective analysis of these findings."
Carter said flatly that Lance would continue on the job.
It was a dramatic endorsement of the beleaguered Lance in which the President put a great deal of his own prestige behind the budget director's integrity and continued ability to function effectively in government.
But while the President, Lance and White House aides said they thought the comptroller's report released yesterday settled the major question concerning Lance's financial dealings, that was not the initial reaction from congressional Republicans.
Sen. Charles H. Percy (R-Ill.), ranking minority member on Senate Governmental Affairs Committee, said the report "does not address several significant aspects of Mr. Lance's financial activities, and questions of improprieties are raised in the report."
Sen. Bob Dole (R-Kan.) said the report "raises many new questions while answering few," and added: "It is hard to conclude that Mr. Lance acted properly in all situations."
The Government Affairs Committee has scheduled hearings Sept. 7 and 8 and has called for testimony from Comptroller John G. Heimann, Lance and possibly others.
In addition, the Senate Banking, Housing and Urban Affairs Committee is considering holding hearings and the House Banking Subcommittee on Financial Institutions Supervision will study it in connection with hearings next month on bank supervisory amendments. So, that affair's sure to retain alive, at least for a while.
In his prepared statement, which he read at the press conference, Lance, like Carter, sought to put a stamp of finality on the investigation and to end speculation that he would leave his post as director of the Office of Management and Budget.
Describing the comptroller's report as "very favorable," Lance said:
"As far as I am concerned I intend to continue with those (OMB) responsibilities and I am confident I can do so effectively. I feel my ability to carry out my job has not been damaged. In this regard, I deeply appreciate the confidence which the President has expressed in me.
"I feel strongly that if allegations such as those raised in recent days can cripple a person's ability to carry out his or her job, then we are in bad shape in our country."
The President's flight from Camp David, a typically Carteresque symbolic gesture, was decided on late yesterday morning in a telephone conversation among Carter, his chief political adviser, Hamilton Jordan, White House press secretary, Jody Powell and White House counsel Robert Lipshutz.
According to Powell, White House officials first received the report Wednesday night. Later that night, Lipshutz discussed it by telephone with the President, who has been vacationing at Camp David since Monday.
Carter got the report early yesterday morning, and after reading it and talking with his aides he decided on the immediate and personal show of support for his budget director.
Saying that few others had been through "such extensive and detailed investigation of their personal and business affairs," the President thanks Lance "for standing firm through difficult times" and for conducting himself "as a gentleman and as a man of complete integrity."
"What is important," Carter said, "is that Bert Lance is a man of competence, of honesty, trustworthy and a man of integrity, and that his services to this country can and should continue. Bert Lance enjoys my complete confidence and support. I am proud to have him as part of my administration."
After declaring that the report "has answered questions that were raised against Bert Lance," the President turned to leave without taking questions, and said, "Bert, I'm proud of you."
Carter, who spent 50 minutes in Washington, returned immediately to Camp David, accompanied by another old friend, Atlanta lawyer Charles Kirbo.
Powell said that, assuming the report would be favorable, it was always planned that the President would make a show of support for Lance when it was released.
"Friendship and that sort of stuff aside, someone should not be run out of government because allegations were made," Powell said. "That is the reason a strong statement was necessary here."
Powell said that Carter's strong public backing of Lance was not an attempt to halt further inquiries into his financial dealings. "But the main questions, it seems to me, have been laid to rest," he said.
Jordan said, "The comptroller cleared him. The President said Bert has his confidence. I can't imagine that several more weeks [of hearings and investigation] would compel him to leave or compel us to suggest that he leave."
Both Powell and Jordan said they saw no risk of embarrassment to Carter from possible further revelations concerning Lance's financial activities.
The President has a particularly high stake in this, not only because of his close relationship with Lance, but because of the high ethical standards he has set for his administration. Carter's image as a man of integrity, presiding over an "open administration," is viewed by his advisers as his single most precious political commodity.
At the news conference, which was also attended by his wife, LaBelle, Lance was peppered for about 40 minutes with questions, many of them skeptical.
He insisted throughout the questioning that the report showed he had done nothing illegal or improper, that his ability to run OMB had not been damaged and that he had met the ethical standards of the Carter administration.
Lance said there were some banking practices - for example allowing overdrafts by himself, his family members and bank employees - that now he wished had not occurred, if only because they became part of the investigation. But he said he was convinced that as president of two Georgia banks he had always protected the stockholders' interest and engaged in sound management practices.
Only once during the press conference did Lance refuse to answer a question. That was when he was asked whether Carter, as a candidate, had eve been flown on the corporate aircraft of the National Bank of Georgia, then headed by Lance. Since use of the aircraft is still being looked into, Lance said it would be inappropriate for him to comment.
Later, Powell said that NBG records showed five flights on the plane by Carter. Three of them were personal trips. The other two - in August, 1975, and October, 1975 - may have involved some campaign activity, he said.
Powell said officials were still checking whether they were political flights and, if so, whether NBG was reimbused for use of the plane by the Carter campaign. Failure to reimburse the bank in such a case could be a technical violation of the federal election law.
Lance said that no time during the weeks of controversy surrounding his finances did he offer to resign.
"I told the President that whenever it appeared I was not doing the kind of job he wanted me to do, all he had to do was tell me," he said.