Panel Votes for Probe of Wright : He Is Accused of Misusing His Post for Gain

The House Committee on Standards of Official Conduct voted to launch a politically embarrassing inquiry Friday into charges of impropriety against Speaker Jim Wright (D-Tex.)--the first time in the 20th Century that the nation’s third-ranking officeholder has been the sole target of a House ethics investigation.

Committee Chairman Julian C. Dixon (D-Los Angeles) announced that the 12-member bipartisan panel had voted unanimously to look into six instances in which Wright, 65, a 17-term congressman who ascended to the position of Speaker in January, 1987, allegedly used his position to enrich himself and Texas associates.

Series of Charges

Among other things, the committee will look into charges that Wright intervened with government agencies and former Egyptian President Anwar Sadat on behalf of Texas oil and gas interests in which he had a financial stake, sought special favors from federal regulators for some Texas savings and loan institutions now under investigation by the Justice Department and published a 117-page book as a subterfuge to convert campaign funds to his own use.

The investigation is certain to undermine efforts of Democratic presidential candidate Michael S. Dukakis to use the so-called “sleaze” issue and allegations of wrongdoing by Atty. Gen. Edwin Meese III to embarrass apparent GOP nominee George Bush in the November election campaign.

Despite pressure from Wright for a speedy inquiry, it is unlikely that the investigation can be completed quickly enough to keep his alleged misconduct from becoming a distraction next month at the Democratic National Convention, of which the Speaker will be chairman.

In Boston, Dukakis told reporters that Wright’s willingness to cooperate had set him apart from Meese and other top Reagan Administration officials who were accused of wrongdoing. “Contrast that with the kind of stonewalling we’ve had on issue after issue after issue involving standards of ethics,” he said.

Demands for Outside Counsel

Republicans, nevertheless, complained that the charges against Wright are still getting less attention than the activities of Meese, who is the target of a special prosecutor’s inquiry. “Nothing less than a public investigation directed by an outside counsel will satisfy America’s right to open and honest government,” GOP Chairman Frank J. Fahrenkopf Jr. said.

But Bush, who often has raised the Wright matter in response to questions about Meese, had no comment. “Look,” he said, “I’m not going to get into guilt or innocence. I’ve been saying, ‘Let the system work,’ when I keep getting asked about Ed Meese, and I think the system should work.”

Wright, a fiercely proud man who for months had scoffed at the charges, quickly pledged to cooperate with the investigation and strongly denied the allegations, which he insisted were politically motivated. He said that he expects the inquiry to lay all the charges to rest.

“To the degree I have erred . . . it would be a mistake of the head and not the heart,” he told reporters. “I don’t think anyone looking analytically at the facts would conclude I have done anything improper.”

Stack of Documents

Wright’s attorney, William C. Oldaker, supplied the committee staff with two huge binders of materials relating to the case and publicly released a huge stack of documents, including a 23-page narrative Wright apparently wrote himself, which answered each of the six charges that the Ethics Committee has resolved to explore. The documents contained no major new disclosures.

Unlike other committees, which Democrats dominate by virtue of their nearly 2-1 majority in the House, Dixon’s is the only panel where Democrats and Republicans serve in equal numbers. Nevertheless, the committee has long had a reputation as a toothless tiger that seldom imposes stiff penalties on members of either party.

Dixon refused to say whether the committee would hire an outside counsel, as it normally does to help the panel’s tiny investigative staff in such cases. According to sources, Wright opposed appointment of an independent counsel on grounds that it would prolong the investigation and allow it to be controlled by someone other than House Democrats beholden to him.

Victory for Gingrich

The committee’s decision to investigate Wright was a big victory for Rep. Newt Gingrich (R-Ga.), a right-wing gadfly who for months has been trying to generate public support for the case. Gingrich, one of many Republicans who chafe under Wright’s iron control of House proceedings, has predicted that the case will lead to his ouster as Speaker.

“He’s now embarrassed his own party,” Gingrich gloated. “Obviously, having a Speaker in this much trouble is helpful to the Republicans and harmful to the Democrats . . . . Having Jim Wright third in line to be President and having Jim Wright with the power of the speakership is very, very dangerous to the process of this country.”

Gingrich’s crusade had been largely ignored, except by newspaper editorial writers, until it gained the support of Common Cause, the citizens’ lobby. After Common Cause petitioned the Ethics Committee for an investigation May 18, Gingrich and 72 other House Republicans then filed their own complaint on May 26.

Expands on Charges

Although the committee technically acted in response to these complaints, the investigation will not be limited to charges raised by the Republicans and Common Cause. One of the six counts the committee is examining--Wright’s use of a friend’s condominium as his official residence in Ft. Worth--was not a part of either complaint filed with the committee.

The condominium is owned by the son of real estate developer George Mallick, who until 1987 was a partner with Wright in an investment company named Mallightco. Questions arose about their relationship after Wright obtained more than $30 million in federal appropriations in the 1986-87 budget for a plan to redevelop the Ft. Worth stockyards, a project in which Mallick had hoped to be involved.

Wright said that while he paid only $21.67 a day for use of the condo, which he recently purchased for $58,500, he and his wife also took care of routine maintenance and upkeep on the place. Furthermore, he asserted, Mallick’s son, Steven, had no interest in legislation.

Calls Sum Not Excessive

As for the book, “Reflections of a Public Man,” on which Wright earned $55,600 in royalties, he argued the sum was not excessive even though it represented about 55% of the profits of the publisher, Carlos Moore. Normally, author royalties are about 10% to 15%.

Wright’s critics claim that Moore, a printer who had served a jail sentence in the early 1970s for income tax evasion, published the book as a way for Wright personally to share in the more than $250,000 in campaign funds that the Speaker had funneled to Moore for bumper stickers and other political paraphernalia.

On the contrary, Wright argued that the arrangement does not violate House rules, which do not impose a ceiling on book royalties. He said the rule cited by Gingrich barring members from receiving excessive fees applies only to honorariums.

The Speaker rejected also the charge that he had violated House rules by asking a staff member, Matthew Cossolotto, to write the book at government expense while reaping the profits personally. He said that Cossolotto volunteered to help with the book on his own time.

Denies Rules Violation

Wright was also accused of using his position in 1979 to plead with Sadat on behalf of Neptune Oil Co., a Texas-based company whose owner had invited Wright to invest in a profitable gas well that was not under control of Neptune. Gingrich said that this violated a House rule barring members from using their influence for financial gain.

Under the same rule, Wright stands accused of intervening with the Interior Department on behalf of Texas Oil & Gas Co. after buying stock in the company. Wright acknowledges that he bought into a well drilled by the company but maintains that he did not invest in the company.

And finally, Wright asserted that he was doing nothing more than representing home-state constituents when he intervened with Edwin J. Gray, then chairman of the Federal Home Loan Bank Board, on behalf of three Texans whose interests were involved in savings and loan foreclosures in late 1986. Sources said Justice Department investigators found no evidence to charge Wright in connection with these cases.

“No allegation has been made that I received any benefit in return,” Wright said. “Clearly, no rule of the House was violated.”

Life Style Noted

According to knowledgeable sources, Wright’s financial problems stem in large part from the desire of his second wife, Betty, to live a more lavish life style than his House salary will permit. Wright’s 1987 financial disclosure form listed assets of $210,013 compared to liabilities of $106,003.

“The solemn fact is that my net worth when I came to Congress at the age of 31 was considerably better by comparative terms than it is today when I am 65,” he said.

As Speaker, Wright is the top Democratic officeholder and second in succession to the presidency. No Speaker has been the sole target of such an inquiry since the late 1800s, although Wright’s predecessor as Speaker, Thomas P. (Tip) O’Neill Jr. (D-Mass.), was one of many implicated in the 1977 House investigation of the Korean lobbying scandal. He was not found to have committed an ethics violation, however.