As Pressure for Campaign-Finance Reform Grows, Parties Seek an Out

Should we all now forget about the fund-raising abuses of the last presidential campaign and move on to other things?

That seems to be the suggestion of President Clinton. Before he left Washington for his trip to Australia and Asia, the White House released a carefully limited set of documents and arranged an interview with the president seemingly aimed at putting the affair to rest.

And in a different way, that also seems to be the suggestion of the Republican Party, whose leaders seem eager to stage-manage televised congressional hearings about wrongdoing by the administration, but are hemming and hawing about the idea of campaign-finance reform.

In his interview, Clinton acknowledged that he had sometimes talked about Asia policy in the White House with the Riady family of Indonesia, his longtime financial backers. But he said he didn’t know that John Huang, the Democratic fund-raiser for Asian American sources, had been dispatched to Taiwan last spring to drum up money for the 1996 campaign. “I would have counseled against that,” the president told the New York Times.

So should we let the whole thing pass by?

Absolutely not, for two reasons. First, the American public needs to know if federal laws were violated by the overseas fund-raising, and, if so, who was responsible. And, second, the public ought to know whether U.S. foreign policy was influenced by these fund-raising activities.

If ever there were a case for an independent counsel, this would seem to be it.

It is illegal to raise campaign money from people who are not American citizens, or from companies overseas. Yet Huang went to Taiwan to drum up money for the Democrats. (Maybe this whole affair should be called “Hands Out Across the Waters.”)

If Clinton didn’t know about Huang’s Taiwan mission, who in the White House did? Were any of Clinton’s top advisors in charge of his fund-raising endeavors? The question underlying this entire affair is whether there was an orchestrated effort by the Clinton White House to raise money abroad, despite the limits in the campaign laws.

Huang, after all, was visiting the White House regularly: 94 times in the last four years, by the official count. Were some of the president’s top aides, such as Bruce Lindsey or Thomas “Mack” McLarty, directing Huang from the White House?

For that matter, whose idea was it that Huang should be transferred from the Commerce Department to a new job as fund-raiser for the Democratic National Committee? So far, the story is that Huang himself asked for the transfer. But it seems more plausible that administration officials asked him to raise money for them.

There will be congressional hearings too. But on this score, the Republicans might well be careful. These should not be like the Whitewater hearings. The last thing the country needs is another Republican-sponsored inquisition in which the motivations are blatantly political and questions of public policy are marginalized.

In its own way, the fund-raising scandal is potentially more serious than Whitewater. After all, Whitewater involved primarily actions that took place in Arkansas, years before Clinton was elected to the presidency.

By contrast, the fund-raising affair covers actions during Clinton’s presidency, in which there is growing evidence of White House involvement.

And the fund-raising affair raises questions about the foreign policy of the United States. Were the administration’s policies toward Indonesia, China or Taiwan affected by a desire to raise campaign money from foreign sources?

We now know, for example, that on his very first trip overseas, the president decided to meet in Tokyo with President Suharto of Indonesia after Clinton’s financial backer, James Riady, stopped by Clinton’s office to lobby for the session.

Until Riady’s visit to the White House, the Indonesian president had been trying without success to obtain a meeting with Clinton. There had been reluctance to grant the meeting because the new president was supposed to be devoting his time in Tokyo to Japan policy and to an economic summit of the world’s leading industrialized countries.

Is Clinton’s session with Suharto the model of how meetings of heads of state are supposed to be arranged? That’s quite a message to send out to other world leaders. Why bother with diplomacy and official channels when you can land a meeting with the president through the intervention of the money men?

Or consider Clinton’s dealing with Taiwan.

One of the most important changes in American policy toward China and Taiwan in decades occurred in May 1995, when Clinton granted a visa so that Taiwan President Lee Teng-hui could visit the United States for his Cornell University reunion. That led to the first military-style confrontation between the United States and China in a quarter of a century.

In the months before Clinton’s decision, the State Department had been refusing to grant Lee a visa. The United States has had no diplomatic relations with Taiwan since 1979. Before last year, no president of Taiwan--not even Generalissimo Chiang Kai-shek, in the days when there were diplomatic ties--had visited this country.

To be sure, Clinton acted under extraordinary pressure from Capitol Hill to grant Lee a visa; if Clinton had not changed policy, he might have been forced to do so by Congress. And Clinton argued afterward that China shouldn’t be allowed to veto the travel by Taiwan’s leaders to the United States.

But it seems fair to ask, in retrospect, whether fund-raising might have been a factor in the president’s Taiwan decision too. Not only was Huang prospecting for campaign money on Taiwan, there are also allegations that James Wood, who the administration appointed last year to be head of the Washington office responsible for America’s unofficial relations with Taiwan, was trying to raise funds for the Democrats in Taipei too.

Yet these questions about Taiwan point out some of the problems and pitfalls of a congressional investigation.

Many Republicans are supporters of Taiwan, and quite a few of them have been recipients of Taiwan’s considerable hospitality. In the first nine months of this year alone, two senators, 18 House members and at least 124 congressional staff members took all-expenses-paid trips to Taiwan, according to The Hill, a publication that covers Congress.

It’s certainly conceivable that fund-raising for congressional campaigns was discussed on some of these trips. Is Congress going to carry out a broad-based, impartial investigation of all sorts of overseas fund-raising, or is it just going to go after Clinton?

The Republicans are said to be preparing to place Sen. Fred Thompson (R-Tenn.) in charge of the hearings into 1996 fund-raising. Thompson certainly knows about congressional inquiries; he was the Republicans’ minority counsel during the Senate Watergate hearings.

The Watergate scandal, of course, produced not only President Nixon’s resignation, but a series of legislative reforms aimed at limiting the influence of money on American political life.

Now, the 1996 fund-raising abuses show the need for new reforms. But so far, the Republicans who control Congress show no signs of wanting to change the system. Last week, Democrats on Capitol Hill were pressing for quick action in the new Congress to reform the system of campaign finance. So far, the Republicans seem to be trying to slow down the momentum for new legislation.

What will come out of the fund-raising affair? What sorts of changes will be made?

You decide. Here are the possibilities: A. Nothing. B. Narrow reform, with a new law barring candidates from any fund-raising overseas. C. Moderate campaign-finance reform, with new limits on the tens of millions of dollars in “soft money” that the political parties now collect from corporations and wealthy individuals. D. Far-reaching reform, requiring free television time for candidates and/or more public financing of federal elections.

If you answered “A,” you’re a true cynic, but you might turn out to be right. If you answered “C” or “D,” you’re an idealist who doesn’t know how skillful Congress is at resisting, postponing and squelching a public clamor for change.

The guess here is “B.” After a year or so of private maneuvering and public hearings, Congress will agree on new, tighter restrictions on raising money from abroad. Except for that one change, the system will remain intact.

And before long, our next crop of presidential candidates will start setting up huge fund-raising operations to campaign in the year 2000.

The International Outlook column appears here every other Monday.