Whitewater affair helps jump-start life of Arkansas businessman

April 17, 1994|By New York Times News Service

While Bill and Hillary Rodham Clinton may consider the furor caused by their investment in Whitewater Development Co. 12 years ago depressing, for James McDougal, their partner in the real estate venture, it suddenly has become utterly rejuvenating.

Some months ago, he was lamenting with friends and interviewers about his miserable life, which he said would soon be ended by an assortment of medical problems. Now, he is running for Congress.

His platform? It's not quite clear, but it has something to do with Whitewater. And the Clintons' innocence. And Republican abuse congressional power. And most certainly with the right of James McDougal to be in the public spotlight he was pushed out of years ago.

"I had sort of lost interest in everything," he said when he filed to run for Congress. "And then all of this just came along, and everybody started pounding on my head."

The difference in the fortunes over the last 20 years of Bill Clinton and Jim McDougal, both once eager young political players in Arkansas, could not be more stark.

Bill Clinton enters a room to "Ruffles and Flourishes" and riveted attention. Until Whitewater became a headline word, Mr. McDougal, bankrupt, divorced and on medication for manic-depressive illness, found admiration only from the waitresses at the Western Sizzlin', an inexpensive restaurant in Arkadelphia where he takes two meals every day.

But while Mr. Clinton waits for Whitewater to go away, Mr. McDougal now is seeking to ride it back from obscurity.

He had a fine time announcing recently that he was selling off plots of genuine Whitewater dirt for $19.95, complete with certificate. He announced his candidacy for Congress on the steps of the State Capitol last month by telling reporters they were a bunch of scoundrels and fools.

And on Tuesday, Mr. McDougal held another news conference to offer 2,000 pages of Whitewater documents -- to those news organizations willing to buy them at 50 cents a page, proceeds to go to his legal defense fund.

But the role of scrappy and voluble defender of the Clintons is a fairly new one for Mr. McDougal. In a February interview, Mr. McDougal had little to say about Whitewater Development Co., which was supposed to develop vacation homes in the Ozarks along the White River.

He was similarly reticent when it came to the affairs of Madison Guaranty Savings and Loan Association, an institution he owned until the federal government closed it at a cost to taxpayers of about $69 million.

Back then, he became expansive only when the conversation turned to his personal misfortunes.

"Any story about me should begin by saying, 'The greatest has fallen,' " he said. "The prophet Job can't compare to me, because he didn't have it nearly so bad. One thing after another has happened to me."

Whitewater critics, like Rep. Jim Leach, R-Iowa, have called the venture a plot to skim federally insured deposits out of Madison, and investigators have detailed the transfer of thousands of dollars from the bank and other McDougal-owned companies into Whitewater's account. A special prosecutor is now looking into the charges.

But in Mr. McDougal's telling, Whitewater was simply the result of his admirable tendencies to be generous.

The White House is not quite sure what to make of the new Jim McDougal, since he is the original source of much of the information about Whitewater and until recently frequently contradicted some major elements of the president's account.

"Our view is he is not anyone we have any control over," one White House official said. "He's a rather unpredictable force. He's neither friend nor enemy, but I think he's someone who has to be treated carefully."

The documents Mr. McDougal released recently, which he said would clear the Clintons, have instead produced a series of articles saying they show inconsistencies in the administration's account.

Mr. McDougal also is resolute in his recollection of an incident that Mr. Clinton has said never happened. He said that sometime in the late summer of 1984, Mr. Clinton jogged by his office at Madison Guaranty one morning and urged him to give some legal business to Mrs. Clinton, who was then a partner in the Rose Law Firm in Little Rock.

He said Mr. Clinton did not explicitly ask him to hire Hillary but the idea just evolved out of a conversation. "I considered it that I was giving a friend's wife work," he said.

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