First In His Class (82 page)

One of Hillary's missions was to protect her husband by being his gate-keeper. During her early years in Arkansas, she often deferred to Clinton's judgments about people; but that had changed forever after his defeat in 1980, when she thought that he had been ill served by poor advice and by his own amiability and that she needed to take a more direct role in his career. After their return to the Governor's Mansion, she would tell friends that she understood him better than anyone, better than his sycophants or critics, and that it was her responsibility to allow him to be his true self. One way to do that was to prevent other people from imposing on him if they seemed against his best interests. She said that she wanted him to be free to use his own mind, which she considered creative and even visionary. Although she was naturally skeptical and direct, even hard-edged in
her dealings, Hillary's role as her husband's protector exaggerated those character traits. Her concerns were largely political, though at times there seemed to be a sexual component to her protectiveness. A male friend of Clinton's noticed that Hillary was classifying the people around Bill as either “one of the goods or one of the bads. If you were bad, you had to be kept away from Bill, because if he was with the bad guys he would relax and enjoy himself and make comments about attractive women waving at him in the crowd.”

In her effort to protect Clinton, Hillary was assisted by two women whom she did not consider threats: press secretary Joan Roberts, who insisted on being in attendance whenever Clinton or another member of the staff spoke to the press; and chief of staff Betsey Wright, whose relationship with Clinton resembled that of
a bossy
big sister. Wright was constantly checking on his whereabouts, sending out scouts to see what he was doing and what his enemies were saying about him, thinking up explanations to put his actions in the best possible light, and trying to keep him away from people she thought wanted to exploit him. These three strong women around Clinton became known in Little Rock as “the Valkyries,” named for the wise and immortal maidens of Old Norse mythology who selected the heroic warriors fit to die in battle and be escorted to Valhalla.

Clinton both encouraged the defensive cordon put up around him and bristled at the way it inhibited him. “
I won't
have it! I won't have it!” he once shouted at Wright when she insisted that a state policeman escort him on his morning jogs. The almost sibling nature of Wright's relationship with Clinton at times stretched the boundaries of boss and chief of staff. His habits began to grate on her, and hers on him. Once when he was noisily chomping on an ice cube, his mouth impolitely open, and reached into his cup to get another cube,
Wright swatted
it out of his hand, which caused him to slap her, reflexively, like a brother hitting his sister. It was only a tap, and it was the only time he struck her, but it was by no means their only fight. She was the aide on whom he vented his frustrations. He staged so many temper tantrums in front of her that he would send her earplugs as an expression of apology. His quarrels with Hillary were even louder and more frequent. But as Hillary told Carolyn Staley that day when they were setting up for croquet on the back lawn, she liked to spar. Mansion workers confided to frequent guests that there were times when they would have loved to disappear while the Clintons screamed at each other.

Another continuing task for Hillary was that of moneymaker. It had been apparent since the beginning of their partnership that Clinton cared little about money outside the political campaign context, and that she would carry the financial burden for the family. But as they entered the prime
wage-earning years of middle age, the arrangement became lopsided. Clinton's part of the deal was to be governor and make a national name for himself while bringing home $35,000 a year in salary.
Hillary felt
the need to build the family savings account at the same time that she was taking on more political assignments that consumed hours she could have been billing law clients. Her dealings in the cattle futures commodities market with Jim Blair in the late 1970s marked the first of several forays into the financial world.

Roy Drew, then a stock broker at E. F. Hutton in Little Rock, had received a call from Hillary in the spring of 1983, just as she was getting into her work on the Education Standards Committee.
She told
Drew that she and two of her partners at Rose Law, Vince Foster, Jr., and Webster Hubbell, had $15,000 each that they wanted him to invest. They called their account Midlife Investors. Foster and Hubbell were placid partners while Hillary was constantly checking in with Drew. “I recommended Diamond Shamrock and a movie deal and Firestone,” Drew recalled. “And Hillary would call and say, ‘What's Firestone doing?' and I'd say, ‘Well, it's up an eighth today,' and she'd say, ‘Why isn't it doing anything?' She was used to the fast action of cattle futures. The next day she'd call and say, ‘Where's Firestone?' and I'd say, ‘Down a half,' and she'd say, ‘Oh, no, what's the matter?' She'd call three or four times a week.”

Some people sensed a growing resentment in Hillary that she had to take on so many private duties in the partnership while at the same time she was being asked, unfairly, she thought, to sacrifice material things. In 1985, Hillary told consultant Dick Morris that she
wanted to
build a swimming pool on the mansion grounds. She said among other things it would be great for Chelsea. “I said, ‘How could you even think of that? You'll get killed for that!' ” Morris recalled. “And she said, ‘Well, it's really not for us, the mansion is for all future governors of the state and they'll all be able to use it.' And I said, ‘You'll never be able to sell that argument. The next time you fly over Little Rock, look down and count the number of swimming pools you see.' She said, ‘Well, a lot of people have swimming pools.ߣ I got really sarcastic with her and said, ‘On the next poll, do you want me to ask whether people have swimming pools?' She was really mad. Very angry. She said, ‘Why can't we lead the lives of normal people?' I saw in that flash the resentment from a lot of those issues, the sacrifices they were making staying in public life.” Clinton, for his part, lamented to friends that he held a job with little income, one where it was politically impractical to seek a raise. He said he felt bad that he was not living up to his responsibility to support the family. But politics was still his only track.

Another role that Hillary assumed was related to the first two—protector and financial guarantor. She was her husband's public relations troubleshooter
and legal problem solver. She provided a full range of formal and informal services. As the public relations consultant,
she would
devote hours to courting John Robert Starr, the managing editor of the
Arkansas Democrat
, in an occasionally effective effort to persuade him to go easier on her husband. As the lawyer, she would quietly represent Clinton's interests, working to resolve some of the most politically sensitive issues in Arkansas, including the resolution of the long-running desegregation case in the Little Rock school district and the state's financial dispute over its disengagement from the costly Grand Gulf nuclear power plant near Port Gibson, Mississippi.

The Grand Gulf case provoked questions, even from Clinton allies, about potential conflicts of interest involving the governor's wife's law firm and state issues. Dick Morris said that when he told his wife Eileen McGann, who was also a lawyer, that Rose Law was representing the Public Service Commission in the Grand Gulf matter, McGann thought it looked like a conflict and said of Hillary, “She'
s got
to be out of her mind!” On his next visit to Little Rock, according to Morris, he raised the issue with Clinton, who said that he needed Hillary and the Rose firm on the case because “anybody else would mangle it.” Morris said that Hillary reacted angrily when he asked her about it, reminding him that Rose was a respected firm which had been doing business with the state long before she came along. Her solution was to dissociate herself from fees Rose Law received in the case.

During the
1986 gubernatorial race, in which Clinton prevailed over Frank White in a bitter rematch, White raised the conflict of interest question regarding Hillary and Grand Gulf. In response, Rose Law issued a statement saying that fees from the case “were segregated from other income and were distributed to members of the firm other than Mrs. Clinton so that she in fact received no direct or indirect benefit from the fees.” The question was framed in financial terms, disregarding the larger notion of Hillary Clinton as the private lawyer watching out for her husband's political interests.
The Clinton
team's political response to White was to belittle him for picking on the governor's wife. They printed bumper stickers and put up billboards with the message: “Frank White for First Lady.” It was another tactic, like the mea culpa commercial of 1982, that worked so well that the Clintons stored it away for future use.

There were other potential conflicts involving Hillary's work as a Rose lawyer and institutions with political or personal connections to her and her husband the governor. In one case,
Dan Lasater,
the bond broker and major Clinton campaign contributor who had gone to jail on a drug conviction, was sued for fraud in the collapse of a savings and loan in
Illinois. Hillary, representing the Federal Deposit Insurance Corporation, helped arrange an out-of-court settlement for less than one-tenth of what the government originally sought. In another,
she helped
represent Jim McDougal when the thrift he owned, Madison Guaranty Savings and Loan, sought permission from the state securities commissioner to raise money by issuing preferred stock in an effort to maintain the minimum capital requirements and avert insolvency. The Madison case underscored the professional, personal, and political triangle of interests in the Clintons' lives during that era.

At one point of the triangle was Hillary's corner office on the third floor of the red brick Rose Law building, a handsomely converted downtown YWCA with hardwood floors and an indoor swimming pool. It was from that office that she signed a letter to the securities commissioner on behalf of McDougal and received a “Dear Hillary” letter in reply. It would later be a question of dispute as to how Hillary became McDougal's lawyer in that matter.
According to
her account, she was merely helping a young Rose associate who did most of the work. According to McDougal and his wife Susan, Hillary actively solicited the savings and loan's business, showing up at Madison's Art Deco-style Little Rock branch office one day and saying she needed new clients and would like the thrift to put her and Rose on retainer. “Hillary came in and was telling us about the problem; the problem was finances and she was not bringing enough in to her law firm,” Susan McDougal later said. “I remember Jim laughing and saying, ‘Well, one lawyer's as good as another, we might as well help Hillary.' ”

At the second point of the triangle was the Georgian-style Governor's Mansion several blocks south of downtown where Bill and Hillary Clinton kept their personal papers related to their private financial relationship with the McDougals in Whitewater Development Company. The land development enterprise along the White River had never made the money McDougal had promised it would, and now, by the mid-1980s, it apparently had cost the Clintons tens of thousands of dollars in interest payments on the original loans they had taken with the McDougals to buy the property.
McDougal was
feeling regret that he had lured the Clintons into the deal. It was, he said, “the dumbest thing I had ever done in my life, from start to finish.”

The final point in the triangle was the governor's office on the second floor of the Capitol. It was from that office that Clinton, as governor, appointed the securities commissioner who regulated McDougal's savings and loan. And it was also from that office that Clinton, the politician, operated his permanent campaign, which included the expensive concept of using paid media to advance his legislative and political agenda. McDougal had a connection to that as well. In April 1985, he replenished the
coffers of the permanent campaign by holding a fundraiser at his Madison branch office in Little Rock, helping to pay off Clinton's political debts, including unsecured personal loans from the Bank of Cherry Valley, which was owned by Clinton's aide and fatherly adviser, Maurice Smith. Clinton and Betsey Wright attended the McDougal fundraiser for “about twenty-five minutes,” Wright recalled.
Wright viewed
the event as an effort by McDougal to “heal a breach with Bill” that had formed since the disappointment of the Whitewater deal. McDougal later said it was Maurice Smith who asked him to stage the event, and that he and Smith, both nondrinkers, had sat up in his office on the second floor while Clinton made the rounds down below. Wright collected the contributions from McDougal and deposited the checks in Clinton's campaign account that night.

Hillary Rodham Clinton, who touched all three corners of the triangle, saw no conflict in her actions. As a lawyer, she said that she was acting professionally, dissociating herself from fees gathered by Rose in its dealings with the state, giving her best advice to clients, whether
they were
the FDIC or Madison Guaranty.
As a
wife and mother, she was trying to bring her family financial security. As a political adviser and pro bono public servant, she was devoting her time and intellect to the betterment of the state. Her motives always seemed practical—she was looking for solutions—but there was also a sanctimonious aspect to it that tended to blind her and her husband to the appearances of what they were doing. Clinton considered her the ethical pillar of their partnership. If she handled a matter for him, he assumed that it would be done extraordinarily well; hence his decision to pick her to lead the Education Standards Committee, because she was “the person closer to me than anyone else,” and his statement to Morris that “anyone else would mangle” the Grand Gulf dilemma. He thought she would keep him out of trouble.