Facing Ethics Investigation : Speaker Wright Haunted by ‘Good Ol’ Boy’ System

Back in 1960, when Rep. Jim Wright (D-Tex.) was trying to decide whether to run for a seat in the Senate, his father sought to discourage him by drawing a sharp distinction between Texas’ two most famous politicians.

“Jim,” he said, “which would you rather be like, Lyndon Johnson or Sam Rayburn? If I were you, I’d rather be like Sam Rayburn.”

Now, more than a quarter-century later, although Wright has achieved the position and much of the power once held by the late House Speaker Rayburn, Wright also has developed a reputation for political cronyism and ruthless partisanship that is reminiscent of Senate leader Johnson.

And, according to his friends and colleagues, this adherence to the Texas tradition of bare-knuckle politics and cozy personal relationships has been a key factor in bringing Wright to the difficult position he is in today--the subject of scrutiny by a House ethics committee investigation for allegedly misusing the influence of his high office to benefit himself and his political allies.

Although political ethics in Washington have changed dramatically over the last two decades, requiring elected officials to put the ideals--or at least the appearance--of good government ahead of party and personal loyalties, Wright still practices an old-fashioned brand of politics based on rewarding your friends and punishing your enemies.

In this economically depressed one-time cattle town that dominates his congressional district, Wright, 65, who became Speaker in January, 1987, is known as a man who never forgets the friends he knew before he became a national political leader and who is willing to go to bat for any Texan who is having trouble with the federal bureaucracy.

“It’s the good ol’ boy system,” explained Frank Barron, president of the Tarrant County Labor Council and a supporter of Wright since 1947. “He came up under the good ol’ boy system. Lyndon and Rayburn practiced it and he’s a protege of those people.”

Wright’s friends believe it was the good ol’ boy system that caused him to intervene with the Federal Home Loan Bank Board on behalf of Texas savings and loan executives who have since been implicated in scandal and also to ask the Interior Department and former Egyptian President Anwar Sadat for help for a friend with whom he had a financial relationship. These are two of the incidents the ethics committee plans to investigate.

Fierce Temper, Loner

Adding to Wright’s difficulties is the fact that in Washington, at least, he is viewed by many Democrats and Republicans alike as a fierce-tempered loner who never hesitates to use the power of his office to obtain a partisan victory. He is hated by many Republicans, some of whom have worked relentlessly to press the allegations against him.

If Wright had taken more time to make friends among his colleagues on both sides of the aisle, many members say, he might not be the subject of an investigation today. “There is no reservoir of good will for him here in the House,” said one Democrat who declined to be identified by name.

Perhaps the most surprising aspect of Wright’s case for those who know him is the suggestion that he used his office for personal gain. Like Rayburn, and unlike Lyndon B. Johnson, Wright never has been accused of using his position to amass a personal fortune. He is well known as a man of modest personal tastes and his 1987 financial disclosure statement indicated that his total assets barely exceed $200,000.

But money recently has become a concern for Wright, according to sources, apparently because his second wife, Betty, likes to live and entertain in a style commensurate with her husband’s high office. Records indicate that Wright was virtually broke after he divorced his first wife, Mab, in the early 1970s.

In fact, Wright’s friends said that his current financial worries may have blinded him to the ethical problems raised by some of his investments and by his decision to accept more than $55,000 in book royalties from William Carlos Moore. The royalties flowed to Wright as a result of an unusually favorable contract with Moore, a Ft. Worth printer to whom he had already given about $600,000 in funds for campaign work; the result is the appearance of a kickback, critics allege.

A man of humble origins, Wright says he decided in childhood that he wanted to go into politics and be the President of the United States. In fact, according to an entry in his personal diary, it was not until the early 1970s that he finally gave up the idea of being President and decided to settle for the highest position in the House of Representatives.

Elected in 1954

After serving as a member of the Texas House of Representatives and mayor of Weatherford, Tex., near Ft. Worth, Wright was elected to Congress in 1954 during Rayburn’s waning days as Speaker. There he emphasized pork-barrel politics and developed a reputation as a man who always responded to the phone calls and the letters of people with problems.

He served on the Public Works Committee, where members traditionally become advocates for federal projects in their home districts. Between 1966 and 1969, he is credited with receiving for his district $1.1 billion in defense contracts, which were cited on a list of “congressional favors” found among former President Johnson’s White House papers.

“Jim Wright was an ombudsman before anyone ever heard of that term,” remarked Democratic Rep. Martin Frost of Dallas, who represents the congressional district adjacent to Wright’s.

Barron, head of the hometown labor council, recalled going to Wright at least a half dozen times in the last 30 years and asking him “to do something for someone” from Texas. He added: “Two of them didn’t even live in his district. They were just friends of mine.”

Among those for whom Wright made phone calls in 1986 was Don Dixon, the head of Vernon Savings & Loan of Dallas, who has been accused by the Federal Savings and Loan Insurance Corp. of defrauding the company of $40 million. Another was Tom Gaubert, the principal stockholder of a federally insured savings and loan that collapsed last year with potential losses of $300 million.

Wright took complaints to federal officials that both Dixon and Gaubert were not being treated fairly by federal investigators. Gaubert was a friend and political supporter but Wright has said he never met Dixon.

Wright also acknowledges that he pleaded with Sadat in 1979 on behalf of Neptune Oil Co., a Texas-based firm whose owner, Richard Moncrief, was an investor with Wright in a gas well in East Texas. Neptune wanted to operate in Egypt. And he concedes that he intervened about the same time with the Interior Department on behalf of the Texas Oil & Gas Co., which operated a well in which Wright invested.

All of these contacts occurred when Wright was House majority leader.

In the estimation of another Democratic Texas congressman, Rep. Jim Chapman, Wright did nothing more than other members do for their constituents. But Chapman acknowledged that the standards of conduct for a House leader, who wields enormous power, may be different than for a relatively powerless rank-and-file member.

“You’ve got 434 other members of Congress here thinking, ‘There but for the grace of God go I,’ ” remarked Chapman, referring to the charges against Wright. “You should be able to be as vocal an advocate for your constituents as Speaker as you are as a freshman congressman, but maybe in the real world you can’t do that.”

Other House members speculate privately that Wright, because of his loyalty to home-state constituents, was an easy target for opportunistic Texans who wanted to cash in on their friendship with a man who was destined to be the nation’s third-raking officeholder. “Politics attracts sleazebags,” remarked a Wright lieutenant.

Frost, who attended one of the meetings in which Wright sought FHLBB Chairman Edwin J. Gray’s help for the Texas savings and loans, faulted the Speaker for failing to investigate thoroughly the requests of those who came to him for help. “You can argue that maybe Jim Wright didn’t ask enough questions,” he said.

But Wright himself insists that he had no responsibility to check the credentials of those who came to him for help. “People come in great numbers to you,” he said earlier last week. “You cannot possibly run an FBI check on them.”

Loyalty to Friends

It was Wright’s loyalty to old friends that also got him involved with Moore, the former political director for the Teamsters Union who published the Speaker’s 117-page book, “Reflections of a Public Man.” Wright is said to have rejected advice to cut his ties with Moore when Moore was freed from jail in the 1970s after serving time for income tax invasion.

Moore, who came to him seeking to publish a book in late 1983 or early 1984, agreed to give Wright an unusually high royalty of 55% on each book, which Wright wrote with the help of a staff member. Critics say that they suspect the book deal was a subterfuge allowing Moore to kick back a portion of the $600,000 in campaign funds that Wright had paid him over the years.

Publishing such a book is recognized by members of Congress as a way to exploit the loopholes in House rules to make extra income. Some purchasers of Wright’s book, such as S. Gene Payte, a Texas real estate developer who bought 1,000 books at $5.95 each, have admitted publicly that they did so to help him financially.

Wright’s reputation for loyalty extends to those who work in his office. Even loyal Democrats in the House contend that the Speaker would not be in such serious trouble if he had a professional staff that could insulate him from old cronies seeking special favors.

“They are fine for a congressman from Ft. Worth, but not for the Speaker of the House,” said a veteran Texas politician. “He’s got a group of guys who have been around him for a long time. But that whole little group around him doesn’t know anything about politics today.”

Ironically, Wright is as good at making enemies as he is at keeping friends.

Jim Bradshaw, a Republican who came closer to unseating Wright in 1980 than any of his other opponents, sees Wright as a vindictive man with too much power. He said that he resents how people in Ft. Worth shy away from him whenever Wright is around, not wanting the Speaker to see them with a former political opponent.

“I don’t think he (Wright) ought to be thanked right along with God every time we count our blessings,” he said bitterly.

Moreover, Bradshaw thinks that power has led Wright astray.

“I think the problem with Jim Wright is just a good example of this, that old Potomac fever, that arrogance of being above the law,” he said. “When you are in politics, you are constantly surrounded by supporters. Those people are saying they love you, that you are doing good. You hear that long enough and you really get to believing it’s true.”

Republican View

Republicans in Washington have a similar view of Wright. And it is no coincidence that many of the 73 House Republicans who signed the complaint against Wright are the same people who have accused the Speaker of abusing the power of his office by using the Rules Committee to keep minority amendments from being offered on major pieces of legislation.

“What this Speaker does is use the rules to dictate the policy outcome,” said Rep. Dick Cheney (R-Wyo.), one of Wright’s accusers.

House Democrats suspect that Wright would never have been charged with personal wrongdoing by the Republicans if his heavy-handed style of running the House had not angered prominent GOP members such as Cheney. In fact, many of the charges leveled against Wright last week were first raised by Texas newspapers as early as 1980.

As for Wright’s personal finances, he clearly is no different from many other House members who depend on their government salary and a few outside investments to make ends meet. Nor does he differ from many members who have trouble juggling the enormous burden of having to maintain one residence in Washington and another in the home district.

Unusually Poor Record

As an investor, moreover, Wright has an unusually poor record. He has lost money in Texas real estate and also by investing in an unsuccessful car dealership in Virginia. In a statement issued last week in response to the charges against him, he lamented that he did not profit from the East Texas gas wells in which he had an interest.

“When it comes to business deals, he’s the last one I’d want as a partner,” remarked Bernard Rapoport, a Waco, Tex., insurance executive and a generous contributor to Democratic candidates who bought 1,000 of Wright’s books.

“He’s like everyone else,” added Barron. “He’s about seven days from bankruptcy.”

Wright clearly has been frustrated by his inability to make money. In 1971, according to a personal diary entry that has since become public, he lamented: “My finances are a shambles. With what unbelievable folly have I so long ignored them and let them drift. In my 30th year I was the richest young man in town. In my 50th year--well. I’m driving a 10-year-old car, owe so god-awful much money. I’ll need luck to pay it off. But I will; somehow, I will.”

That same sentiment was expressed in a public statement that Wright issued last week: “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.”

But Wright insists that money has never been of interest to him. “ . . . If I had been primarily interested in making money,” he wrote, “I most certainly would not have come to Congress and I darn sure wouldn’t have stayed for 34 years.”

His colleagues agree that he has never been a man who sought wealth. “He’s not interested in the finer things of life,” noted Rep. Tony Coelho (D-Merced), the House assistant majority leader. “I’ve traveled with him and he doesn’t play golf or go to fancy restaurants.”

Wife’s Tastes

But other House members noted that Wright’s wife does not share her husband’s simple tastes. As an example, they noted that it was Mrs. Wright who was responsible for redecorating all of the Speaker’s offices after her husband moved in.

Wright and his wife bought a $228,000 home near Washington in 1983, but until recently have owned no residence in their home district. One of the charges against Wright is that he improperly benefited from the generosity of a friend, Steven Mallick, by paying only $21.67 a day for the use of an apartment owned by Mallick whenever they go home to Ft. Worth.

The Wright case has directed a harsh spotlight on the political mores of Ft. Worth. Many of those hometown people who have been mentioned in connection with the investigation are clearly stunned by the nationwide attention the charges are receiving.

Rapoport, for one, thinks the inquiry is going too far.

“What decent person is going to want to run for public office?” he asked. “If you put a mirror on anybody, you’re going to find some blemishes. I’ve got a 3 1/2-year-old daughter and you could probably get something on her.”

Sara Fritz reported from Washington and J. Michael Kennedy reported from Ft. Worth.