Clinton's campaign loans raise concerns about Bill's income

McClatchy NewspapersMay 8, 2008 

WASHINGTON — Hillary Clinton's decision to lend her presidential campaign $6.4 million from assets she holds jointly with her husband is rekindling questions about millions of dollars that special interests have paid Bill Clinton for speeches and other work since he left the White House.

In tapping some of that cash, "the Clintons have effectively bypassed campaign finance reform in a manner that's ingenious — using Bill Clinton effectively as a front for the fundraising," said Lawrence Jacobs, a University of Minnesota political science professor.

Beginning days after he left the White House in 2001, the ex-president has been crisscrossing the globe, speaking roughly 250 times on tours that brought him more than $40 million in six years.

The sponsors have included investment banks that later suffered billions of dollars in losses in the sub-prime mortgage debacle and now have a big stake in any regulatory changes; an insurance group with an interest in any overhaul of the nation's health care system; a group that favors the reunification of Taiwan with mainland China; a Colombian business development group that backs a free-trade agreement and more than two dozen Jewish groups, synagogues and museums.

Clinton campaign spokesman Jay Carson dismissed such concerns, saying: "There are no conflicts of interest, and every dollar either of them (the Clintons) have made is all publicly available."

However, said Jacobs, the director of the university's Center for the Study of Politics and Governance: "There appear to be a number of prominent, wealthy corporations in the financial services sector, the health care sector and others that stand to gain considerably from the election of Hillary Clinton as president," said Jacobs. "If all of these groups were giving to her directly, there would be all sorts of questions raised . . . ."

Questions about family income also have dogged the presumptive Republican presidential nominee, Arizona Sen. John McCain. The Democratic National Committee Thursday prodded McCain to release the tax returns of his wealthy wife, Cindy.

McCain recently made public his own tax returns for 2006 and 2007, but said that he and his wife, the heiress to a beer distributorship, have always kept their finances separate. On NBC's "Today Show" Thursday morning, Cindy McCain said that she would never release her tax returns, not even if she becomes first lady.

"I'm not the candidate," she said.

When Hillary Clinton lent her campaign $5 million in early February, she made it clear that those funds came from her own money. That was plausible, because her pre-tax earnings have totaled about $11 million from her salary as a New York senator and from advances and royalties for her book, "Living History".

But her last-ditch decision to tap joint funds to remain financially competitive with rival Barack Obama exposes her husband's financial dealings over the last seven years to greater scrutiny.

On Wednesday, when Clinton spokesman Howard Wolfson disclosed that she'd lent her campaign another $6,425,000 since April 11, he said that the funds came from their shared assets. Wolfson said that Clinton is willing to lend her campaign more money "going forward, in order to make sure our message gets out."

"Legally, she is entitled to use up to 50 percent of their jointly held assets for her campaign, if she chooses," Wolfson said. "Those are the rules . . . . We are scrupulously following the rules, and we will continue to do so."

Jacobs, however, said that by drawing on her husband's earnings, Hillary Clinton is enabling sponsors who paid as much as $450,000 to hear him speak to "funnel their funds through the Bill Clinton front."

"It's an ingenious method for fundraising that bypasses campaign finance (rules), bypasses public disclosure and bypasses the limits placed on those contributions," he said.

While many of Bill Clinton's 250 speeches have been motivational talks or delivered to groups with no obvious agendas, others were to businesses and others with clear political or policy interests:

_ Citigroup paid him $550,000 for three appearances in Paris and New York in 2004 and 2006, and Deutsche Bank paid $300,000 for two 2005 speeches. Both firms could be further hurt by proposed changes in federal regulations or laws now being considered amid waves of mortgage defaults that have stalled the economy.

_ The Mortgage Bankers Association, facing new regulatory threats amid from the sub-prime mess, paid Clinton $150,000 for a Chicago speech in 2006.

_ America's Health Insurance Plans, whose 1,300-member group is one of that industry's strongest lobbying forces, shelled out $150,000 for a Clinton appearance in Las Vegas in 2005.

_ Gold Service International, a business development group based in Bogota, Colombia, paid Clinton $800,000 in 2005 for four days of appearances in Mexico, Colombia and Brazil. The group favors the Colombia Free Trade Agreement that Hillary Clinton has vociferously opposed.

_ In 2002, the ex-president picked up a $300,000 check from the Australian Council for the Promotion of Peaceful Reunification of China — a Beijing-backed group that favors ending Taiwan's independence from China.

_ Clinton made millions of dollars from a partnership with Los Angeles equity fund chief Ronald Burkle while private equity and hedge funds are fighting to retain a tax loophole that allows partners to pay only 15 percent taxes on most of their earnings. Hillary Clinton has said that she favors eliminating the loophole.

_ Bill Clinton has spoken to more than two dozen Jewish groups, synagogues and museums that together have paid him more than $3 million, backing that could heighten criticism of Hillary Clinton's vow to "totally obliterate" Iran if it launched a nuclear strike against Israel.

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