Deaver-Miller Meeting on B-1B Raises Ethics Questions

Former Deputy White House Chief of Staff Michael K. Deaver, who now runs his own public relations and lobbying firm, conferred with the Administration’s budget director on behalf of a client in February, about 10 months after leaving his government job, Administration officials said Tuesday.

The meeting with James C. Miller III, director of the Office of Management and Budget--part of an effort to increase the Air Force’s purchase of B-1B bombers made by Rockwell International Corp.--raised questions about Deaver’s adherence to government ethics regulations prohibiting former senior officials from conducting business with their former offices or agencies during their first year out of government service.

Miller, Deaver aide William Sittmann and White House spokesman Larry Speakes said no wrongdoing was committed because Deaver, who held his Administration post until last May, worked directly for the President, while the budget office is considered a separate entity.

Lawyer Present

Miller said a budget office lawyer was present during the Feb. 27 meeting. Sittmann said a lawyer from Deaver’s company asserted that government regulations did not prevent Deaver from conferring with Miller.

A well-placed White House source, speaking on the condition that he not be identified, added that neither the budget office nor the B-1B bomber were areas to which Deaver devoted great attention while employed at the White House.

While Deaver held a title second in rank to then-White House Chief of Staff James A. Baker III during President Reagan’s first term, his office’s placement close to the Oval Office, his years of work for Reagan’s presidential campaigns as a Los Angeles public relations executive and a reported friendship with First Lady Nancy Reagan gave him a special position in the Reagan political family.

Significant Role

Miller, although less visible than his predecessor, David A. Stockman, plays a significant role as budget director in all major spending decisions and could be expected to enter any discussions about new orders of the B-1B.

Rockwell, which is assembling the new bomber in Palmdale, Calif., was awarded a contract for 100 B-1Bs at about $280 million each in 1981, four years after an earlier version was canceled by President Jimmy Carter. With the end of work on the B-1B in sight, the company made an unsolicited offer in February to sell an additional 48 B-1Bs to the Air Force for $195 million each.

But Pentagon officials have said that they have no plans to buy more than 100 of the bombers and are turning their attention to the next generation of bomber--the highly classified Advanced Technology Bomber, which would use stealth technology to hide from enemy radar.

15 to 20 Minutes

Before delivering a speech in Detroit, Miller said at a news conference that he spent 15 to 20 minutes with Deaver at the February meeting, during which the former White House official recommended that the government increase its purchase of the B-1Bs rather than relying on the Stealth bombers.

In Santa Barbara, Calif., where Reagan is spending an Easter vacation, Speakes said in a statement: “It would appear that there was no violation of the one-year prohibition. . . . The OMB director does not work in the White House and Mr. Deaver did not ever deal with the issue in the past.”

Sittmann, who worked for Deaver at the White House and joined Deaver’s public relations firm, described the Feb. 27 meeting as “a courtesy call . . . to let Jim (Miller) know who Mike does represent and all the topics his clients are interested in.”

‘Better Decision’

“What’s wrong with Deaver talking with Miller about a client?” a former colleague of Deaver asked. “I don’t think there are any (violations of) ethics involved when you go speak to someone. You’re giving them information so they can make a better decision.”

But David Plocher, a lawyer employed by OMB Watch, a nonprofit research group that monitors budget office activities, said that “it seems to me that (what Deaver did) is what the law was intended to prevent.”

Although the budget office is considered a separate entity from the White House office, Plocher said it is “the largest unit within the executive office of the President, and it invalidates the principle of the ethics law to see a former high official of the executive office of the President back in there lobbying on behalf of corporate clients.”

Times staff writer James Risen in Detroit contributed to this report.