The Electronic Telegraph   Sunday 16 January 1994   World News

Crisis control recalls an old forgotten era
By Ambrose Evans-Pritchard

THE trouble began with a few slights, real or imagined. Courtesy calls were omitted. Consultations were not as close as they should have been. The White House was a little curt. Nothing serious, but it all seemed to irritate Daniel Patrick Moynihan, the Democratic Chairman of the Senate Finance Committee, and over the months things have gone from bad to worse.

The professorial, bow-tied, elder statesman should have been a natural ally of the President, but has become his most acerbic critic on Capitol Hill, deriding the Clinton budget figures as "fantasy".

Last Sunday he crossed the Rubicon, becoming the first Democratic Senator to join Republicans in calling for a special counsel to investigate the business dealings of Bill and Hillary Clinton.

Within two days, the White House strategy of crisis-control lay in ruins. Eight Democratic grandees endorsed the call of Senator Moynihan. It was no longer possible to dismiss the allegations as partisan politics.

The Senate had turned against the President, and a congressional committee of inquiry was only a matter of time. It was to head off this disastrous possibility, which would have exposed the financial culture of the Clintons week after week on live television, that the White House changed tack and called for the appointment of a special counsel.

The fate of the First Couple now lies in the hands of the Attorney-General, Janet Reno, who became the chief of federal law enforcement by a strange twist of fate, after every other woman chosen or considered for the post - Hillary Clinton insisted it had to be a woman - turned out to have a nanny problem.

How the White House must now wish it had stayed the course with Zoe Baird, a flexible corporate lawyer quite unlike this ascetic, incorruptible woman with a streak of fanaticism. How, too, it must regret the attempt to discipline her in a campaign of nasty leaks when she fell out with the administration over crime policy last year.

If there is one member of the Clinton cabinet who is not considered part of the team, who is mistrusted as an outsider, it is Ms Reno. It would not be entirely surprising if she hurled a firebrand prosecutor at them.

The warm glow of President Clinton's successful trip to Europe is unlikely to last long when he returns to Washington. The city is buzzing with rumours. Whitewater, Madison Guaranty S & L, the Rose Law firm - these absurdly small provincial outfits from the Clinton past - are all that anybody wants to talk about in the power circles of the capital.

The courtiers of the President, who include much of the punditocracy, still profess confidence that the First Couple will be absolved in the end, with some minor embarrassment along the way.

But the reporters who have actually worked in the digging fields of Little Rock know the scandal is much more serious than that. They take bets on the survival of the Clinton presidency. The odds, still long, are shortening quickly.

The key charges were laid out in a bombshell article two weeks ago by the Republican Vice-Chairman of the House Banking Committee, Representative Jim Leach.

Was an Arkansas building society used as a "piggy bank" for the Clinton coterie, and for paying off a personal debt contracted by Bill Clinton in connection with his 1984 election campaign as governor?

Did the building society pay Hillary Clinton $2,000 a month - on the request of the governor - in exchange for regulatory influence? Did part of a $300,000 government loan intended for racial minorities and the handicapped, and never repaid, end up in the account of a property venture that was 50 per cent owned by the Clintons?

The question that connoisseurs of Washington scandal like to debate these days is whether matters got out of hand because of a pattern of stonewalling and fishy cover-up manoeuvres.

The "Whitewater files" were removed from the office of Vincent Foster, White House Deputy Counsel, after his unexplained suicide last summer. Before Christmas the President bowed to pressure and announced that the files were to be turned over to the Justice Department immediately. But, almost four weeks later, it is still unclear whether or not this has been done.

The documents are being "catalogued", reminding the connoisseurs of Nixon's Watergate tactic of "limited modified hangout" - or stalling. It failed. So why don't the Clintons just come clean and hand over all troublesome papers?

The answer to that is likely to occupy much of the next six months in Washington.

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