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Rubber congressmen - check bouncing scandal
National Review, April 13, 1992 by William McGurn
IT'S NOT OFTEN I find myself in the same league as our esteemed solons on Capitol Hill. But my bona fides was established the same day the Democrats caved in to pressure to release the names of all 296 members and 59 former members of Congress who had kited checks. That evening I returned home in high spirits, only to find a note from my bank saying that check #1331, in the amount of $300, had been returned for insufficient funds.
Like other outraged citizens, however, this will by no means preclude me from gleefully casting stones. For starters, unlike checks drawn on the House Bank, mine actually bounce when I go over the limit. In addition, my infraction will cost me $25. Had this standard fine applied to, say, Robert Mrazek (D., N.Y.), he would owe $24,300 in penalties alone.
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But the biggest difference between these congressmen and the rest of us is a proper sense of shame. Most of us have at one time or another come up short in our checking accounts, and most of us are greatly embarrassed by the experience. Compare this to the pompous complaint by Vic Fazio (D., Calif.) on MacNeil/Lehrer that Republicans are talking about check-kiting "to avoid frankly the subjects that we really need to be talking about, the scandal in health care, the prolonged recession, the high rates of unemployment . . . ." etc. (You left out the homeless, congressman.) On the same show, radio whiz Rush Limbaugh immediately called him to task. "[I]t just won't do, Congressman Fazio, to sit there and say that the people don't care about this, that they want you to sit there and do the work of the country. You haven't been doing the work of the country. . . . You guys are our employees and you treat people in the country like we are your employees and you're the boss."
House Speaker Tom Foley must wish he had checked in with Mr. Limbaugh back when the issue was first brought to his attention, because his failure to act now threatens both his job and his party. As NR goes to press there are rumors that he was informed of problems with the House Bank as long ago as 1989, and we know for certain that there was a General Accounting Office report on the trouble back in 1990. The Speaker's failure to investigate is now sparking talk of a criminal investigation and is wreaking havoc in his own party. For Republicans, even more important than nailing another Speaker's scalp to the wall is an unprecedented opportunity to break the 38-year Democratic stranglehold on the Capitol--if only the President seizes the opportunity. If he doesn't, he is likely to find that the brewing public rebellion against government will lump him in with Congress as a willing accomplice.
Even the bare outlines of the scandal suffice to show why the Democrats are running scared. The first GAO report was completely ignored. But when the GAO issued another report in September 1991, a group of freshmen Republican known as the Gang of Seven--Scott Klug (Wis.), Rick Santorum (Pa.), Jim Nussle (Iowa), John Doolittle (Calif.), Frank Riggs (Calif.), Charles Taylor (N.C.), and John Boehner (Ohio)--pressed for an investigation and refused to back down. This took more guts than is generally acknowledged, because the Young Turks were taking on the club itself; one of them says he felt as though "a large bull's-eye" were painted on his back as he mingled with his colleagues. Although Speaker Foley rejected the call for an investigation, the Gang of Seven kept the pressure on with special orders (short speeches to the camera at the end of business), eventually forcing Foley's hand. The result was the ethics-committee investigation.
Here is where it becomes unclear how much of the Speaker's reluctance to act was criminal and how much was sheer incompetence. Originally he wanted to limit disclosure to the 24 worst offenders. Unfortunately, the criteria used to select these 24 were flawed: the member had to have bounced checks in 8 of the 39 months under review, and for amounts larger than his monthly salary. This didn't get at people like, say, number 25 on the list, who bounced more than 850 checks totaling more than $150,000 over that period. Minority Whip Newt Gingrich cried foul and pressed for full disclosure.
The irony was that, far from limiting damage, the attempt to protect those who had abused the system ended up hurting those who were guilty of nothing more than not knowing exactly what their balances were on any given day. Most congressmen are quite right to say they knew of no problems, because it appears the House Bank waited as long as seven weeks to cash deposits (leading to speculation that it was floating money to cover up other scams). Since more than two hundred relatively innocent congressmen now face an angry electorate, Speaker Foley is arguably more unpopular with Democracts in the House than he is with Republicans.
This is not to minimize the criminal element. Right now we know there was a delay between the time Foley knew about the scandal and when he acted. What is not yet clear is whether he informed the Postal Service investigators about the criminal evidence obtained by the Capital Police, and whether he took any steps to conceal any of this from the U.S. Attorney's office. On the individual level, there are already cases of admitted wrongdoing: former Representative Jim Bates (D., Calif.) and at least two others have admitted using money for their campaigns. Others could be in trouble with the IRS for their failure to report outstanding notes, as wellas those interest-free loans, as income. There are even rumors of one member taking intererest-free money from his House Bank account and lending it to his campaign at 16 per cent interest.
