A Woman in Charge (59 page)

Though McDougal talked up the idea that the investment would earn a nice nest egg for the Clintons' retirement, interest rates in the late 1970s skyrocketed, and retirees became less interested in buying homes, so they all lost money on the venture.

Wright and other Clinton friends insisted that Whitewater was a bad real estate deal that the Clintons were constantly trying to get out of. “And at one time they thought they were out of it. It came up every year with me in filing the disclosure forms, getting them prepared for filing. And I just very well remember the year I had to go back and amend it because they thought they were out of it, and then found out that they weren't,” said Wright.

Though hurt and angry at her treatment by the Clintons after they left Arkansas, Wright steadfastly defended their motivations and actions in the Whitewater deal. Hillary and Bill were thirty and thirty-two years old, respectively, when they made their investment. “It was a mess from the beginning. This was a case of trying to be landowners by typical do-gooders who didn't know anything about setting up a business. And they thought Jim [McDougal] did. That's why it was a mess. They didn't worry about it…. It's a big step when you buy your first investment…. They were idealistic kids when they did this.”

By the time a special prosecutor had been appointed to investigate their investment, they were a long way from being idealistic kids.

 

A
FTER
S
CHMIDT'S
Halloween story ran in the
Washington Post,
she and the paper's editors began an insistent effort to get the White House to provide them with the underlying documents—especially tax returns—mentioned in the Resolution Trust Corporation's criminal referral, and which the Clintons insisted would exonerate them.

Later, it became almost a parlor game in Washington to speculate on what would have happened had the Clintons agreed to give the material to the
Post
and make public their tax returns and the related documents. After all, went one line of reasoning, Bill and Hillary's decision to refuse release of the materials—against the urging of some of their senior political advisers—and insist on their privacy led indirectly but almost inevitably to the appointment of a special prosecutor, which in turn led to Ken Starr's obdurate investigation, which in turn brought the Paula Jones civil case into Starr's line of questioning, which in turn led to Monica Lewinsky, and eventually the impeachment. And it appeared to be true that, in the tax returns, there was no evidence that the Clintons had done anything illegal, only the extremely embarrassing revelation that Hillary had made a $100,000 killing on cattle futures, which led to her subsequent feeble attempts to explain her supposed expertise on the subject.

But with the White House creating an indelible impression that it was trying to stonewall, suspicion grew. The media seized on it and powerful and ordinary citizens alike who were predisposed to dislike the Clintons smelled blood. Less than two weeks after Schmidt's story, on November 11, Andrea Mitchell reported on
NBC Nightly News
that there was a “connection” between Vince Foster's death and the Clintons' involvement in Whitewater. “Before his death in July, former White House lawyer Vince Foster also got involved, helping the Clintons sell their share of the land company,” she said on the air. “He also discovered a tax mess; the partnership had not filed federal or state returns for three years. Now questions are being raised about a possible link between the growing Arkansas investigations and Foster's death.”

The White House could no longer effectively manage the story (if it ever could), or control the damage. “Whitewater became the catch-all term for any allegation of unseemliness or impropriety against anyone anywhere near the Clintons or the White House—and it stuck,” George Stephanopoulos recalled. Meanwhile, the Clinton legislative agenda, including health care, was stalled and the president's popularity was plummeting, he noted.

In November and December, the
Washington Post
sought to obtain the Whitewater documents through an unusual set of negotiations. “The
Post
was convinced we were hiding something sinister,” Stephanopoulos said. “Executive Editor Leonard Downie made a series of extraordinary personal requests for the documents,” and White House correspondent Ann Devroy “warned me that the paper would go on the warpath unless we answered their questions and released the documents.” The requests set in motion a series of meetings to debate the issue within the Clinton administration. Hillary set the tone for the White House's response. She was joined by Nussbaum, Lindsey, and a cadre of lawyers who were implacably opposed to providing the records—especially the tax returns—to the
Post
or releasing them elsewhere publicly. Stephanopoulos, Gergen, McLarty, and Nussbaum's deputy Joel Klein, on the other hand, argued that the facts would come out eventually so the administration might as well turn over the records and get it over with. “I don't want them poring over our personal lives,” Hillary told Nussbaum. He needed no convincing. “You're entitled to your privacy,” he told her. “If you turn them over…[e]very document will be a news story. It will go on and on.” Gergen had been hired specifically to deal with just this kind of problem with the press. The
Post
had submitted a list of questions in the first week of December about Whitewater. Gergen told Bruce Lindsey, “We can't just sit here and stiff them. You're just inviting a tough response. My strong recommendation is to see what they want and then see what should be in the public domain and release it.” Lindsey and Gergen sought the advice of Betsey Wright. She, too, was opposed to cooperating with the
Post.
“They have managed to twist every piece of information out of context…. I wouldn't give them anything.”

By December 10, Hillary said, she and Bill were especially angry that Gergen had gone to the
Post
newsroom to meet with the paper's editors, and had seemed almost to promise that the newspaper would get the documents; the Clintons had not authorized him to hold out such a promise. The next day Gergen and Stephanopoulos made a final plea to the president after his radio address. Clinton sat between the two men drinking a cup of coffee. He listened intently. “I don't have a big problem with giving them what we have,” he told them. “But Hillary…” She was not about to consent to reporters sifting through the documentary remnants of their past, looking at records of their investments, their tax returns, her legal work at the Rose Law Firm.

“Saying her name flipped a switch in his head,” Stephanopoulos said. “Suddenly his eyes lit up, and two years' worth of venom spewed from his mouth.” Stephanopoulos could usually tell when the president was making Hillary's argument: “even if he was yelling, his voice had a flat quality, as if he were a high school debater speeding through a series of memorized facts.” Now Bill began a tirade about the press. “No, you're wrong. The questions won't stop. At the Sperling Breakfast I answered more questions about my private life than any candidate
ever
and what did
that
get me? They'll
always
want more. No president has ever been treated like I've been treated.”

Gergen and Stephanopoulos continued to argue that it would be better to release the documents while the American public was focused on the upcoming Christmas holidays. “On this issue, Clinton wasn't commander-in-chief, just a husband beholden to his wife,” Stephanopoulos realized. Hillary had steadfastly defended him against allegations about “bimbos.” Now it was his turn to defend her. Gergen and I didn't know what was in the Whitewater documents, but whatever it was, Hillary didn't want it out—and she had a veto.”

Hillary, indeed, had the greatest influence over her husband's final decision. A high-ranking aide knew how the first lady's anger could often transfer to Bill and color his response to situations. “She would get him all riled up in a way that wasn't exactly his nature. He has this terrible self-pitying anger inside of him, but it's a slightly different thing when she would get her hand into it. This was an example of where he hadn't thought the choice was so clear-cut; he could see the political benefit of both sides, including giving up the documents and telling everything he knew to the
Post.
”

The decision came down to two points, the aide said. “There was a principle which was, If we give this up, we give up everything, we'll never be able to claim privacy again. And they were right. They'd put themselves into a precedent-setting situation. They didn't know how it would come out. There was also this fear that the questions would never end. Because that's what she kept saying.”

Hillary never wavered. “These are my papers. They belong to me. I could throw them all in the Potomac River if I wanted to.”

Some White House aides later speculated privately that Hillary feared continued attention on the Whitewater land deal and the Clintons' partnership with the McDougals might reveal an affair between Bill and Susan McDougal in the 1970s or 1980s, as gossip in Arkansas had long had it. If the purported motif of Watergate had been “Follow the Money,” Whitewater's was plausibly “Follow the Women.” In the end, that was really where public, press, and prosecutorial interest seemed to redound most fervently.

Hillary's influence in regard to the Whitewater documents was determinate, and further discussion was ruled out. A hand-delivered letter from Lindsey to Downie was sent on December 10:

As you know, in March, 1992, the Clinton Campaign released a report by an independent accounting firm which established that the Clintons lost at least $68,900 on Whitewater Development Corporation. They received no gain of any kind on their investment. The Clintons were not involved in the management or operation of the company, nor did they keep its records. We see no need to supplement the March, 1992 CPA report or to provide further documentation.

Now, handed their sheet music by the White House, a Republican chorus on Capitol Hill enthusiastically chanted the familiar stanzas of the oratorio of Slick Willy and His Wife, and thunderously demanded intervention from the prosecutorial gods.

 

H
ILLARY SAID
she was hosting a Christmas party in the White House a week later when she took an urgent call from David Kendall, who told her that
The American Spectator,
a far-right monthly of particular vitriol on the subject of the Clintons, planned to publish a story about Bill's supposed sexual encounters with a multitude of women while he was governor, based on testimony from state troopers who claimed they had helped facilitate their rendezvous.
^*17
Kendall's advice to the White House was to issue no comment; it would only attract more attention to the story. Its author, David Brock, claimed to have spent more than thirty hours interviewing Arkansas state troopers. He said the troopers also told him that Betsey Wright and George Stephanopoulos had “strong-armed” other sources into keeping their mouths shut.

Two of the troopers, Larry Patterson and Roger Perry, described on the record the ways in which they allegedly facilitated Bill's affairs. The troopers said the governor asked them to drive him to hotels where he'd visit the women. Or they'd stay on “Hillary Watch” while he was away from the mansion. On one occasion, Clinton instructed a trooper to approach a woman named Paula, who was standing in the lobby of the Excelsior Hotel in Little Rock, and ask her to meet with the governor in a room upstairs. Brock's editors had inadvertently failed to eliminate her name from the story. Eventually, Paula's identity and her purported encounter with Clinton would be excruciatingly detailed.

The general allegations weren't exactly new. But seeing them in print was. Betsey Wright and other aides had been able to contain similar stories during the presidential campaign, and even before. What was unquestionably new this time was that four troopers, two of them on the record, went into detail about whom the former governor met, how, and when.

Once again, Wright had been dispatched—to Little Rock, by Mack McLarty—to pour water on the fire, before
The American Spectator
reached the newsstands, but her effort was to little avail. “Basically I think there was a lot of hope that I could get the troopers who weren't quoted in the article to make public statements that this wasn't the truth,” Wright said. “That wasn't possible, and I knew that wasn't going to be possible. But I did get from Danny Ferguson, who was quoted in the article, an affidavit. That took some real doing. It was most specifically about Paula Jones because…he was supposed to be the trooper who was with Bill when they went back to the hotel.”

In essence, the affidavit alleged that Jones was a stalker, the same claim (which in its abbreviated form was not untrue) that Bill made to Hillary and to his aides about Monica Lewinsky when it was first alleged that she had boasted of a sexual relationship with him: According to Wright, Paula Jones “was on a major stalking campaign and anytime a trooper would come in and out [of the governor's office] she would befriend them and talk about when she could get with him…. This was after the so-called incident [at the Excelsior Hotel]. Absolutely. The pursuit was hot and heavy after the incident. People on the staff didn't know what to do, how to get rid of this woman, who is stalking him. They didn't know what she was going to end up saying later.”

Wright believed that some of the troopers told the truth and others didn't. “They were all bitter,” she said. “They all felt unappreciated, that they had been through a lot of tough times with [Bill], and he just left [Arkansas] and told Buddy Young [his chief of security] to sort of take care of them. He had talked to a number of them about coming to D.C. with him and there was never any follow-up. And so it got to be more and more poison. And I'd get calls from a couple who liked Bill the most. They were saying, You know, we can take care of this, we can head this off if he'll just come down and have a picnic with them or something, you know, a barbecue, anything just to convey to them that he really appreciates them.”