TIME: Almanac 1995

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<text id=94TT1009> <title> Aug. 01, 1994: Whitewater:Who Said What, to Whom? </title> <history> TIME--The Weekly Newsmagazine--1994 Aug. 01, 1994 This is the beginning...:Rwanda/Zaire </history> <article> <source>Time Magazine</source> <hdr> WHITEWATER, Page 20 Who Said What, And to Whom? </hdr> <body> At the hearings, questions about whether Treasury chiefs told the truth could cause some fireworks By George J. Church--Reported by Suneel Ratan/Washington For a populace that has nearly ODed on O.J., the hearings that begin this week may well prove disappointing. Yes, there will be witnesses--some from the White House--answering questions under oath. But instead of bloody gloves and thumps in the night, their testimony will focus on when and what Treasury Department higher-ups learned about contacts between their underlings and White House aides concerning a Resolution Trust Corporation recommendation that the Justice Department consider...Are you still there? Just possibly, though, the doings will be a bit livelier than expected when the House Banking Committee begins hearings Tuesday into Washington aspects of the Whitewater affair (the Senate Banking Committee will open separate hearings a few days later). Several high Administration officials will probably face sharp questioning as to whether they have been telling the truth. And there could be some entertaining partisan wrangling in the House Committee between Republicans trying to pose argumentative questions and Democratic chairman Henry Gonzalez trying to gavel such queries into silence. In fact, it was only the possibility of scoring partisan points that tempted Republicans into agreeing to hold hearings now. At a meeting of G.O.P. congressional powers back in March, Iowa Representative Jim Leach, who by then had emerged as his party's leading Whitewater prober, protested that the timing looked all wrong. The hearings, he noted, could delve only into matters that special counsel Robert Fiske had finished investigating. By midsummer that would include only developments in Washington--not any financial and real estate dealings in Arkansas by Governor Bill Clinton and his wife. Moreover, says someone familiar with the March meeting, Leach warned that "the chance was very real that Fiske was going to say no laws were broken ((a forecast that has proved precisely accurate)) and that we would hold a hearing that would be a big nothing." New York Senator Alfonse D'Amato, however, argued that Republicans should grab any opportunity to embarrass the Administration. He won. Fiske has asked that the probers not look into the removal of papers from the office of White House counsel Vincent Foster after his suicide in July 1993 because the special counsel is still investigating that. Gonzalez has ruled out any questions in his House panel about any aspects of Foster's death. Leach once asserted that a midsummer probe could look into only 5% of all the questions concerning Whitewater; last week he reduced that estimate to 2% or 3%. Even so, some top officials could be made to squirm, beginning with Secretary of the Treasury Lloyd Bentsen. Jean Hanson, general counsel of the Treasury, has reportedly told investigators that she briefed Bentsen about 1993 meetings between lower Treasury officials and White House aides concerning a Whitewater-related investigation before press reports of the meetings surfaced. In March, Bentsen said he knew nothing about any such contacts before they came to light. Bentsen is expected to testify that he does not recollect any such briefing. Still, one document leaked as the hearings were about to begin begged new questions about what Bentsen and other Treasury officials knew and when they knew it. In a memo from Hanson dated Sept. 30 that is in the hands of congressional probers,she writes of press inquiries about the investigation and continues, "I have spoken with the Secretary ((Bentsen)) and also Bernie Nussbaum," who was then White House counsel. The investigation, into the failure of Madison Guaranty Savings & Loan, which was owned by Clinton friend and Whitewater partner James McDougal, was conducted by the Resolution Trust Corporation, a federal organization that gets financing from the Treasury. RTC had referred its findings to the Justice Department for possible criminal prosecution, naming Bill and Hillary Clinton as possible--though perhaps unwitting--beneficiaries of financial shenanigans. Deputy Treasury Secretary Roger Altman, to whom Hanson's memo was addressed, could land in more trouble too. He has admitted that he gave White House officials a "heads up" briefing on the RTC probe in February, but at first did not acknowledge knowing of any earlier meetings. Even before her Sept. 30 memo turned up, however, Hanson reportedly told investigators that Altman not only knew about similar meetings in September and October 1993 but actually ordered them. Those reports have touched off rumors that Altman, once thought likely to succeed Bentsen at Treasury, is considering resigning. Sources close to Altman deny it. And the White House has not indicated that it wants Altman to go. Altman has released a statement saying, "My recollection may differ from Miss Hanson's, but there is nothing unusual about that." One other snippet could also come up at the hearings. Clinton himself, it turns out, asked Eugene Ludwig, who as Comptroller of the Currency is the Treasury's top banking regulator, for advice about the Madison investigation. According to Ludwig's spokesman Lee Cross, at a Renaissance Weekend conference over the New Year holiday in South Carolina, Clinton asked Ludwig, who was sitting next to the President in a seminar, "if he could provide any advice on the Whitewater matter, advice on the legal and regulatory issues" involved in the collapse of Madison. Ludwig consulted Hanson and deputy White House counsel Joel Klein. They thought it "would not be appropriate," and Ludwig told the President so when next they met. So what? Maybe nothing--but the incident does not exactly disprove critics who are worried that the White House tried to exert improper influence on government regulatory agencies to soft-pedal Whitewater-related inquiries. On the eve of the hearings, committee members and staffers seemed to be as worked up over who might be leaking such bits of information as they were over the actual tidbits. D'Amato and Senate Banking Committee chairman Donald Riegle, a Michigan Democrat, both called for an ethics committee inquiry into the leaks, which is not the sort of thing that resonates loudly outside the Beltway. The hearings themselves, though, if nothing else, should serve as a kind of training camp in which both sides warm up and test themes to use in the eventual main event: the post-Fiske probe into just what happened in Arkansas. </body> </article> </text>