Money Troubles for Democrats

Insight on the News, Nov 9, 1998 by Jennifer G. Hickey

Money, the mother's milk of politics, also is the root of evil in the Democratic Party/Clinton-Gore campaign-finance labyrinth, according to a report just released by the House.

With the release of a report by the House Government Reform and Oversight Committee, the focus of Washington's attention has switched from sex to man's other great vice -- money. In the whole of the majority staff's report, there is mention of neither presidential genitalia nor oral sex. The crisp propriety of bank transactions replaces the steamy speculation about sexual relations. The orange robes of Buddhist monks take the place of a blue Gap dress. And the acronym of record is FEC, not DNA.

The specter of impeachment hearings in November has been raising the level of anxiety inside the Washington Belt way as each day passes. The Oct. 8 release of the interim report on campaign finance dealt yet another blow to an embattled president. And the discovery of a further $1.8 million in suspect and possibly illegal contributions to the Democratic National Committee, or DNC, does not bode well for a political party already in a precarious financial state.

The campaign-finance saga began in much the same way as the Monica Lewinsky case -- with one stumble leading into a mine field. This stumble began with the initial reports by the Los Angeles Times of an illegal $250,000 contribution made by a South Korean company, Cheong Am, whose president is Kyung Hoon Lee. After the campaign came to an end and Clinton emerged victorious, allegations and reports in the media abounded concerning illegal donations made to the Democrats by a host of Asian nationals, most prominently former DNC vice chairman John Huang, a onetime high-level Commerce Department employee.

Swamped in stories of improper fund-raising practices, the DNC hired the firm of Debevoise & Plimpton to conduct a review of its contributions during the 1996 election cycle -- and subsequently returned nearly $3.2 million in illegal campaign funds, of which $1,298,800 was raised by Huang. At the same time, in total, the Republicans returned $150,000 in contributions they believed might be tainted. The scandal blossomed shortly thereafter with a Washington Post report detailing the Justice Department's discovery of a plan by the Red Chinese government "to direct contributions from foreign sources to the Democratic National Committee before the 1996 presidential campaign."

Taking its lead from the Senate Governmental Affairs Committee, which published its report in late 1997, the House committee has focused on the infusion of foreign money into the U.S. political system by Huang; Clinton friend Charlie Yah Lin Trie; Clinton buddy Johnny Chung, an ex-Little Rock restaurateur with Red Chinese contacts; and the family and businesses of Ted Sieong, also closely linked to Beijing. Furthermore, they have uncovered additional potentially illegal donations from South America. Bank record by bank record, deposition by deposition, the majority staff has amassed a compendium of possible campaign-finance violations.

Naturally enough, the Democrats are denying all. "This is a travesty of a mockery of a sham," says DNC spokesman Rick Hess of the committee filing, continuing, "For Chairman [Dan] Burton [of Indiana] to say we are holding money is absolutely ludicrous."

Before the debate could begin about whether the Democrats have been remiss or negligent in returning $1.7 million in questionable donations, the most heated disagreement was addressed by the committee -- whether its investigation was prolonged because of Democratic and Clinton-Gore "stonewalling" or as a result of a Republican "partisan witch-hunt." Reflecting the importance the staff places on the stonewalling, a 30-page analysis of the "Unprecedented Obstacles to the Committee's Investigation" directly follows the report's introduction. The primary obstruction, according to the committee report, has been the reluctance of witnesses to cooperate with the investigation -- a reluctance also encountered by the Senate investigation. To date, 79 potential witnesses have exercised their Fifth Amendment right lest they incriminate themselves, 18 witnesses have bolted from the country and 23 who now reside outside of the United States have refused to testify. This brings the total of noncooperating witnesses to 120, says the report.

The Burton report also cites a pattern of unresponsiveness by the Clinton-Gore administration and the White House Counsel's Office. The House Government Reform and Oversight Committee experienced similar delays during its investigation into the firing of the seven-member White House Travel Office. In fact, this has been going on while the administration claims to be following the practice set by Ronald Reagan's counsel, Edwin Meese III, who refused to claim executive privilege over documents in the Iran-Contra investigation.

The Clinton-Gore administration has asserted executive privilege in at least seven investigations. The committee reports that even when the administration does not claim a privilege to withhold documents, it is less than forthcoming. The White House Counsel's Office response to Burton committee directives is typical. On Jan. 15, 1997, the committee issued a directive for production of documents responsive to their subpoena. On Jan. 31, White House Counsel Jack Quinn responded to Burtons request, informing the committee that the administration was "unable to produce documents in the two-week time period the Committee requested and that production would be delayed [still further] until a meeting time could be arranged with White House officials." A week later, some of the documents found their way into the hands of reporters, and five days later the documents finally were delivered to the committee.