President Seeks to Defend Wife on Whitewater

President Clinton, jumping to his wife’s defense on a day when new inconsistencies were revealed in the White House account of the Whitewater saga, insisted Thursday that Republicans so far have failed to prove allegations that First Lady Hillary Rodham Clinton misrepresented the truth.

“No discrepancies have been established. . . ,” declared Clinton, who until now has sought to distance himself from the quarrel between the first lady and the GOP. “An allegation is not the same as a fact.”

While fielding questions at a news conference, the president sought to portray the first family as victims of a typical Washington-style political smear campaign. He said Hillary Clinton, because of her efforts at health care reform, is now the target of naysayers similar to those who attacked former First Lady Eleanor Roosevelt for her work on behalf of the poor.

The president spoke out shortly after a former law partner of Hillary Clinton, testifying before the Senate Whitewater committee, disputed the first lady’s recollections of how she came in the mid-1980s to represent a Little Rock, Ark., savings and loan that was owned by James B. McDougal, the Clintons’ investment partner in the failed Whitewater real estate deal.

Richard Massey, who was an associate at the Rose Law firm where Hillary Clinton practiced while her husband was governor of Arkansas, said he did not bring McDougal’s account to the law firm, as the first lady suggested during a nationally televised press conference in 1994.

Massey acknowledged that he did approach John Latham, one of McDougal’s employees, about hiring the Rose firm to represent the thrift. But he said he never had the impression that his entreaty was responsible for winning McDougal’s Madison Guaranty Savings & Loan as a client.

Meanwhile, the committee released a copy of an interview with Latham by Resolution Trust Corp. investigators in which the former Madison Guaranty employee recalled that McDougal himself proposed using the Rose firm because of his friendship with Hillary Clinton.

As the RTC recounted the interview: “Latham said that McDougal had friends over there [and] he suggested we use them. . . . Asked who the friends were, [Latham replied] that it was Hillary Rodham Clinton and others.”

Republicans on the committee also noted that McDougal told The Times in an interview several years ago that then-Gov. Clinton personally asked him to give Hillary Clinton some of the Madison Guaranty legal business in order to help the family financially.

Whitewater investigators have long been interested in how the Rose firm came to represent Madison Guaranty, not only because McDougal’s mismanagement of the federally insured thrift cost the taxpayers about $60 million but because many of the records of this period have never been found.

Ever since the issue first arose during the 1992 presidential campaign, Hillary Clinton has repeatedly downplayed her work for Madison Guaranty. Republicans have said they suspect she has done so to conceal her knowledge of illegal activities by McDougal.

Massey said neither he nor his law partners were aware at the time that the Clintons were investment partners with McDougal in the Whitewater land deal while Hillary Clinton represented the thrift. He said he was “disappointed” when their partnership later came to light because he believed it had created a conflict of interest for her.

Under questioning from committee Republicans, Massey also disputed Hillary Clinton’s contention that he did “all of the work” for Madison Guaranty while she served only as the so-called “billing partner.” Recently discovered billing records of that period also show that she was involved in the day-to-day representation of the thrift.

At the same time, Massey recalled how he was approached in February 1992 by then-Rose partner Vincent Foster, a confidant of Hillary Clinton who was seeking all of the records of the law firm’s work for Madison Guaranty in the mid-1980s. Foster later became deputy White House counsel and committed suicide in July 1993.

Massey made copies of his records and gave them to Foster. But before Massey could finish making the copies, he recalled, Foster became impatient. “He was frustrated that I wasn’t prepared to hand off the files without a complete set in my possession,” Massey said.

Republicans suggested that Foster was angry with Massey because he wanted to destroy all existing records of Hillary Clinton’s work for Madison Guaranty. Democrats said he was probably frustrated because Massey was taking too long to copy them. Massey offered no interpretation.

Massey said he would never have given the documents to Foster if he had known that they were going to be used by the Clinton campaign to fend off questions from the press. The copies wound up in the possession of former Associate Atty. Gen. Webster L. Hubbell, who is now serving a jail sentence for defrauding the Rose firm.

At his press conference, the president pledged that his wife would answer these allegations in the near future, and he predicted that they would be proven false, as other charges have.

“I would remind the American people, when it comes to the whole Whitewater issue, the allegations have often--and matter of fact, virtually always--borne no relationship to the facts,” he said. “That’s really the story of this for the last four years. An allegation comes up and we answer it and then people say: ‘Well, here’s another allegation, answer this.’ We’re doing it.”

Meanwhile, in a separate House investigation into the 1993 firings of seven employees of the White House travel office, in which the first lady allegedly played a role, Rep. William F. Clinger Jr. (R-Pa.) issued subpoenas Thursday for all relevant records held by six current or former presidential aides.