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TIME: Almanac 1990
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1990 Time Magazine Compact Almanac, The (1991)(Time).iso
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1990-09-17
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PRESS, Page 48Where Were the Media on HUD?Washington journalists missed the scandal when it was breakingBy Michael Riley
Big bucks. Heaps of hypocrisy. Influence peddling by prominent
Republicans. The unfolding scandal at the Department of Housing and
Urban Development is the kind of story that guarantees front-page
play. It is also the kind of story that could guarantee brilliant
future careers, perhaps even Pulitzer Prizes, for enterprising
journalists. So reporters have pounced on Washington's latest
example of sleaze. There is just one hitch: it's yesterday's news.
All that murky bureaucratic back scratching and buck passing
happened during the heyday of the Reagan Administration. Where was
the ever vigilant press back then?
The short answer: sleeping. Almost 5,000 reporters prowl the
nation's capital, and during the Reagan era, many Washington
insiders knew what any inquisitive reporter should have known: HUD,
with its million-dollar contracts, was a feeding trough. "Everybody
who talked about HUD knew there was money to be made," says
Republican political consultant David Keene. Despite recurring
gossip about payoffs and even some hard evidence, the nation's best
TV news organizations, newspapers and newsmagazines -- including
TIME -- failed to report the corruption at HUD until last spring,
when an internal investigation jump-started the story. The entire
episode says a great deal about shortcomings in the way the press
covers Government. "Somebody, an editor or a reporter, should have
said, `Where is the money going?' " says Bob Woodward, assistant
managing editor of the Washington Post.
At least one reporter picked up the scent early on. In December
1986 Joan Jacobson, a housing reporter for the Baltimore Evening
Sun, received a tip: Rhode Island developer Judith Siegel was
throwing James Watt's name around HUD offices in Baltimore in
connection with a low-income-housing rehabilitation project that
Siegel wanted to develop in Essex, Md. Like any good reporter,
Jacobson started asking questions. Why would the former Interior
Secretary, now a Wyoming-based businessman and a professed enemy
of Big Government, be involved in such a project? Jacobson started
combing every public file on the 312-unit Kingsley Park development
but could not turn up any references to Watt. Jacobson says Siegel
flatly denied that Watt was involved. Since Jacobson could not
confirm the story, she shelved it.
As it turned out, Jacobson's source was right. Watt had
received a $300,000 consulting fee from Siegel for making eight
telephone calls and holding a 30-minute meeting with HUD Secretary
Samuel Pierce to ease the way for the project. Siegel claims she
does not recall talking with Jacobson in 1987. "You think I'm going
to risk five, six or seven hundred thousand dollars talking to
somebody on the Baltimore (Evening) Sun?" asks the developer today.
Local housing officials, curious about Watt's involvement, were
cheering Jacobson along. "I wanted her to find the facts," says
Maryland community-development administration director Trudy
McFall. "But they just weren't there." Laments Jacobson: "I feel
bad that I couldn't prove the story."
The Washington-based national press missed the warning signs
altogether. In July 1988 Multi-Housing News, a trade publication,
ran an extensive story on influence peddling in HUD's Moderate
Rehabilitation program, spelling out, with almost every detail
except the malefactors' names, the $2 billion scandal that has
since emerged. Reports from HUD's own inspector general sounded
similar tocsins. But none of Washington's investigative journalists
seemed to be listening. Part of the reason was that news
organizations had tired of HUD after reporting the massive Reagan
budget cutbacks at the agency in the early 1980s; once most of the
money was gone, so were the reporters. Only a few regularly covered
the huge bureaucracy.
While sources went uncultivated and leaks dried up, the
capital's best reporters were caught by other stories, like
allegations against former Attorney General Ed Meese and the
Iran-contra scandal. HUD remained the gulag of Washington
journalism, a backwater with an obscure chief administrator they
dubbed "Silent Sam" Pierce. There was a distinct lack of glitz and
glamour about the HUD beat. "We were looking elsewhere," explains
syndicated columnist Jack Anderson. "We don't have enough eyes to
look at HUD. The very name HUD says dullness, dullness, dullness."
To complete the circle of neglect, Congress failed to monitor
the enormous agency closely. For one thing, since hearings drew
scant coverage, members of Congress sought public attention
elsewhere. For another, the lawful political benefits of the pork
barrel may have tempered criticism of HUD. Former Senator William
Proxmire, who was chairman of the HUD subcommittee of the Senate
Appropriations Committee, applauds the current congressional probe
of the agency. Says he: "That's what we should have been doing. We
didn't."
Even the most blatant instances of influence peddling went
virtually unnoticed. Paul Manafort, later a leading campaign
adviser to President Bush, used his connections at HUD to ensure
funding for an unwanted $43 million rehabilitation of dilapidated
housing in Seabrook, N.J. Not only was he a partner in the
development firm involved on the project, but he also received
$326,000 in fees for his trouble. The matter went unreported for
three years. Are there any lessons to be learned from the HUD
fiasco? Offered one Washington reporter: "Just because something's
silent, that doesn't mean it's asleep."