Dean: At Center of HUD Mess

For the longest time, Deborah Gore Dean wandered through life. She went to college and wandered for eight years, detouring to Ireland, to the drama club, to off-campus jobs and occasionally to class. Neither she nor her professors came away dazzled.

She drifted through political campaigns, stumping first for her aunt, Louise Gore, in legislative and gubernatorial races in Maryland, then stepping aboard Ronald Reagan’s presidential juggernaut in 1980. But she voted for no one, because she never registered until the summer before her 27th birthday, in 1981.

Eventually, she made her way to a job at the Department of Housing and Urban Development, and Deborah Dean stopped wandering. In a way, she was back where she had begun, reborn into power and money.

As executive assistant to agency secretary Samuel R. Pierce Jr., Dean took control, her colleagues say, and Pierce usually seemed willing to go along for the ride.

But a funny thing happened. HUD itself began to wander, drifting from its mission of housing the poor into forays of political favoritism, waste and fraud. And now, as Congress and auditors try to make sense of the agency’s misguided mess of about $2 billion in losses, many point to the 34-year-old Dean as a symbol of the inexperience and caprice that led HUD astray.

Agency documents and correspondence support that assessment. Widely varying portraits of Dean emerged in interviews with more than 40 of her friends, family members and co-workers. But even the most divergent views shared common themes.

Conflicting Portrait

To many of her HUD colleagues, of whom more than 24 were interviewed, she became a manipulative, temperamental despot who demanded obedience and inspired fear. Those who were loyal were promoted. Those who bucked the system found their careers at a dead end.

To her family and friends, she is warm, devoted and willing to go the extra mile, whether that means daily hospital visits to her mother, who is struggling through chemotherapy, or pulling together family celebrations of Thanksgiving and Christmas.

But both schools of thought hold that Dean has an assertive, take-charge attitude, an outgoing personality, a flair for the theatrical gesture, yet also a tendency to be insecure and naive.

Dean is not talking to reporters these days. When she appeared last month before Congress, she took the Fifth Amendment, and she refers media inquiries to her lawyer, former U.S. Attorney Joseph diGenova.

Her life has been out of the ordinary almost from the beginning. She was born in New York City, but in 1958 when she was 3, her father, Gordon, once head of the Atomic Energy Commission, was killed in a plane crash.

Her mother, Mary Gore Dean, then moved the family to the Gore family estate in the Washington suburb of Marwood, Md. It was quite a place to grow up--a red-roofed, 33-room mansion set on 200 acres of pastures and woodland overlooking a wide, sweeping bend on the Potomac River. It made a cameo appearance in the film “Broadcast News,” masquerading as the Italian Embassy.

Politics in the Family

At Marwood, politics were passed round the dinner table with the meat and potatoes. Aunt Louise, who never married, served in the Maryland Legislature and was the Republican gubernatorial nominee in 1974, defeated by Marvin Mandel. Two of her uncles were senators, Thomas Pryor Gore of Oklahoma and Albert Gore of the family’s Democratic wing in Tennessee (his son, Albert Gore Jr., is now a senator).

When life got boring, there was always the spacious family townhouse in Georgetown, or the set of family apartments at the Gores’ Fairfax Hotel (later sold and renamed the Ritz-Carlton), or perhaps a meal at the Gores’ snappy restaurant, the Jockey Club.

Dean’s mother made a point of not spoiling her children, Louise Gore said, yet no one pressured Dean as she moved through Georgetown University at a leisurely pace. She spent eight years before graduating, barely, 507th in a class of 509, said Bart Naylor, who in 1987 did a background check on her for the Senate Banking Committee.

She then turned her attention to a small local magazine, City Life, that she and a friend put together a year earlier. She gave that up a few months later to work briefly for a public relations firm, then phoned home one day in 1981 to announce she joined the federal government. On a tip from a friend, she landed a job as a public relations assistant in the Department of Energy. That is also when she registered to vote.

After little more than a year, she moved over to HUD, becoming a special assistant to the secretary, which mostly involved keeping mail flowing smoothly through the office. Her work caught the attention of Pierce, and 18 months later she made the move that many people now say she was not ready for, up to the job as Pierce’s executive assistant. Some of her friends suggested her ascent was eased by her connection to the late John Mitchell, attorney general in the Nixon Administration, who then lived with her mother.

A Trifle Insecure

In those days, her charm and wit made her well-liked, HUD officials say. Many thought she was a trifle insecure, but at first that showed up only in small ways, such as when she bought extravagant gifts for friends and co-workers.

She stayed busy, working long hours and viewing HUD’s programs idealistically. “I honestly think that when she first took the job her motivations were pure,” a former senior HUD official said. “But over the years those motivations eroded.”

Her boss, meanwhile, was gone for long stretches. A former Pierce assistant whose office was across the hall recalled that she met the secretary one-on-one only once during her first three months, and that was at a photo session.

Into that vacuum of power moved Dean. “It was subtle,” one senior official said. “She just slowly realized she could get away with more and more.” So, when people came looking for the secretary to cut red tape, Dean did the job instead.

“She was a pleasure to deal with,” recalled a Philadelphia developer, John B. Rosenthal, who needed HUD rental subsidies to help convert an old hotel into 64 apartments for the elderly. “The people (at HUD) told us that she was really the key decision maker on those programs.”

‘Ultimate Weapon’

Dean’s co-workers said her growing authority had the secretary’s tacit consent, but that her “ultimate weapon” was his signature, which she commanded with an autopen device that scrawled “Samuel R. Pierce Jr.” at the push of a button.

So, Dean’s bursts of extravagance progressed, HUD officials said, and her favors now came from HUD’s large pocketbook of grants and subsidies, particularly the moderate rehabilitation program, known as Mod Rehab, that encouraged developers to spruce up dilapidated housing for low-income tenants.

Such grants were supposed to be awarded to local housing authorities, which sorted out the best proposals. But HUD documents show that Dean helped turn the process upside down, with approval coming straight from the top. Soon, the word was out among well-connected Republicans: If you want HUD money, see Dean.

“I think that because of her insecurity there was almost a feeding frenzy with these consultants and developers,” a former HUD administrator said. “I think they knew that if you took her to dinner once, twice, or took her to an important function, that Debbie would do anything for you. I think Debbie thought these people were truly friends . . . but you learn in this business that if you give out money people are only in it for their own interests, and the minute you lose your signing authority, hasta la bye-bye.”

Though other officials joined in, some senior staff members at HUD did not think this was a great way to run things, and they said so, according to senior HUD officials. Dean turned on them. “People seemed to think she had a hit list,” Naylor said.

Almost Invincible

Dean proved to be invincible on most personnel decisions, officials said, and the results were often brutal. Among the examples cited by more than a dozen HUD employees: She had an employee’s office furniture moved out while he was away, she had employees stripped of authority or moved to dead-end positions and she held up promotions.

Emblematic of the cavalier treatment was her release of a confidential HUD memo in 1986 to an official of the Teamsters Union. The union failed to get some HUD grants, and one reason was a rejection by Robert Wilden, director of a HUD housing division. Dean gave union housing official John J. Joyce a copy of Wilden’s critique of the Teamster proposals, and Joyce reacted by saying there was a “cancer” at HUD that needed to be “cut out.”

Wilden was shaken by the threat, according to a HUD investigation of the matter, though Dean told an investigator she did not take the remark seriously and laughingly replied to Joyce, “What are you going to do, put him (Wilden) in cement shoes?”

Some employees became so fearful of possible retaliation by Dean that they felt obligated to obey without question when she asked them to help clean her apartment during work hours or run other errands. She borrowed one employee’s charge card to buy a dress, then “repaid” the employee a few months later by dropping off the dress at the employee’s desk, former administrators said. The employee let the matter drop.

But as Dean solidified her control at HUD, her control in other areas slipped. Frequently she spent late nights out, according to employees who socialized with her, and they say she often showed up for work at 10:30 or 11 a.m., complaining of a hangover. Dean, through her spokesman, denied that.

Her personal finances were a mess, Naylor said. She qualified for a credit card only by applying through HUD for a Diner’s Club account. Though she signed an agreement not to use the card for personal expenses, she did anyway, and by late 1987 ran up a balance of $5,390, with $1,765 in overdue payments. When HUD cautioned her about the card, she said she had not read the fine print, but she used the card twice more for personal charges, one a payment of $206 at Bloomingdale’s.

‘A Workaholic’

Friends and family members apparently did not notice any signs of trouble. Gore said her biggest concern then was that her niece had become “a workaholic.”

They also said Dean talked little of her work except about the agency’s push for Fair Housing legislation, one of the few efforts for which Pierce has received praise. Dean organized a nationwide promotional tour for Pierce on the subject, but even that was tainted by disclosures that she had financed much of the trip with $2 million from businesses, many of which dealt with HUD.

Gradually, the public began to find out about the way things were running at HUD. Some hints emerged in late 1987, when Dean was nominated to become HUD’s deputy secretary, a title that would have made her the agency’s official No. 2 administrator.

Dean testified at her confirmation hearing in August, 1987, “I have never given or approved or pushed or coerced anyone to help any developer.” Nonetheless, the Senate held up her nomination for months, and was preparing to subpoena witnesses to see whether she committed perjury, Naylor said, when the White House withdrew her name.

By then she had left HUD but was keeping in touch through her new business as a consultant. HUD officials said she used her contacts in the agency to help boost her early business.

When the HUD inspector general and a congressional inquiry began prying into the HUD mess last spring, Dean soon achieved notoriety, and joining the chorus against her was Pierce, who told reporters after testifying before Congress, “She liked power. She liked the idea, ‘I can call the shots, I can get this for you if I want, I can stomp on you, I can kill you.’ ”

That prompted Dean’s younger brother, Gordon, to say of Pierce, “He has, as Mark Twain put it, shown all the qualities of a dog, except loyalty.”

Family and friends say Dean has become a scapegoat. “It’s the barracuda theory at work,” said friend Michael Bayer, who was her boss at the Department of Energy, and now lobbies for a natural gas pipe company. “In Washington, if it bleeds, hit it. A lot of people are real anxious for one person to be responsible for what went on over there.”

Though Dean is silent for now, she may yet testify before Congress if she can get some immunity against prosecution. She has hinted she would pin her actions on Pierce.

Meantime, she is once again adrift, staying busy by supervising an overhaul of the family’s Georgetown townhouse, consulting with her attorney and doing a bit of consulting, though her spokesman would not say what kind.