Clinton Shares Concern of Whitewater Counsel Critics

President Clinton on Thursday edged close to questioning the objectivity of Whitewater independent counsel Kenneth W. Starr, saying that Starr’s outside legal ties to his administration’s foes are “plain for all to see.”

At the end of a White House news briefing devoted mainly to the new budget accord, Clinton’s remarks amounted to a suggestion that he agrees with Starr’s Democratic critics who say the former federal appellate judge should resign his prosecutorial duties or relinquish his high-profile outside clients.

The president also said that “the American people and the press should have access” to the videotaped testimony he is to give Sunday in a Whitewater-related fraud trial. But he said he hoped that it would not be “abused in any way.”

Clinton’s testimony, when shown to jurors, will be reported by the media. But the White House and Justice Department are asking that U.S. District Judge George Howard Jr. treat it in the same manner as live testimony in the federal court system, which is not available to be televised.

White House aides have said they do not want video snippets of Clinton’s testimony to be taken out of context for laughs on late-night television shows or to be used for attempted ridicule in Republican campaign commercials on television.

Clinton is scheduled to provide up to eight hours of taped testimony. The videotape, to be edited by Howard, will be shown later to jurors hearing the fraud case in Little Rock, Ark., involving Clinton’s former partners in the Whitewater land deal, James B. and Susan McDougal, and Clinton’s successor in Arkansas, Gov. Jim Guy Tucker.

Starr is permitted by law to have outside clients while investigating Whitewater. But he has been criticized for representing tobacco interests at a time when they are contesting proposed regulations by the Food and Drug Administration that would control nicotine and advertising aimed at teenage smokers.

Also, Starr’s law firm last December settled a civil suit filed by the Resolution Trust Corp. for the role the firm played in the collapse of a Colorado thrift. At the time, his Whitewater investigators were examining the conduct of RTC officials in overseeing the bailout of an Arkansas savings and loan association founded by James McDougal.

When asked about the issue of Starr’s legal work, White House Counsel Jack Quinn said recently that while the administration is cooperating with the probe, “we are, of course, concerned about anything that calls into question his fairness and independence.”

Some of Starr’s other blue-chip clients are major Republican donors. At least one Democratic congressman, Rep. Martin T. Meehan of Massachusetts, has said Starr’s findings on Whitewater matters “are absolutely tainted.”

Clinton, declining to give a direct answer on his views, told reporters: “The facts are what they are. And they’re plain for all to see.”

His remarks came as a special Senate investigating committee continued hearings on Whitewater with testimony from Betsey Wright, chief of staff when Clinton was governor of Arkansas.

Wright insisted that James McDougal, the president’s onetime partner in the Whitewater land deal, had received no preferential treatment from the statehouse in Little Rock despite such assertions earlier this week by Sen. Alfonse M. D’Amato (R-N.Y.), the committee chairman. D’Amato charged that Clinton awarded “lucrative contracts” to McDougal in the 1980s to lease space to state agencies in return for campaign contributions McDougal had arranged.

The space was in the building owned by McDougal’s Madison Guaranty Savings & Loan Assn., a thrift that went bankrupt in 1986.

Wright called the favoritism charge “preposterous.”

“We didn’t treat Jim McDougal with any more deference than any other businessman,” she testified.