Friday, May 03, 2002

D.M. provides the first entry in the Find Spikey Mikey's errors and other attempts to distort the truth:

1. `[Clinton and McDougal]' concocted a scheme to route business to
Hillary Clinton by placing her on a $2,000 a month retainer.

The Rose firm was on a retainer, which was prepayment of fees
(not a payment in addition to fees). The Clinton's take from
this would be measured in tens of dollars per month.

2. Jim and Sunsan McDougal (longtime business partners of the
Clintons in the Whitewater real estate venture)...

Partners in the careless, common usage of the term, but not
partners in the legal sense (the Clintons invested in a
coporation set up by the McDougals and were not executives,
or officers in the business, nor were they informed about
its dealings (until much later when Hillary Clinton went in
to clean up the mess).

3. portray the entire Whitewater scandal as the fevered
concoction of a ... right wing conspiracy...

No one has (to my knowledge) ever suggested that McDougal
was not a crook. The question is, what did his misdeeds
have to do with the Clintons.

4. McDougal, a convicted crook, was running a corrupt savings
and load that was regulated by Bill Clinton's appointees.

McDougal was not a convicted crook when he ran the S&L.
While it is technically true that Clinton appointed
Arkansas bank regulators, it is hard to see how he could
have done otherwise, being governor and all, and thus
responsible for such appointments. However, the
regulatory power of those officials was minimal.
(Basically, the FSLIC was on the hook for any loses and
so they ran the regulatory roost. In their wisdom,
they chose to ignore the requests by Clinton's
regulators that they deal with McDougal's S&L. And do
not get me started on the decision that and S&L could
issue stock (any S&L, not Madison specifically, though
they asked the question). That decision is so firmly
grounded in the law, how could any other decision be

5. At the same time, [McDougal] was both covering Clinton's
debts in a floundering real estate investment firm...

The Clintons did cosign the Whitewater mortgage. If
Whitewater went bankrupt, they would be on the hook for
whatever portion of the mortgage was not paid.
McDougal did invest money in Whitewater in order to
keep it afloat. So, in some narrow legalistic sense,
the statement might be true. However, the Clintons
were not informed about this, were not asked whether
they wanted it, indeed were not told any business
details. If they had been told business details, it is
most likely they would have said that Whitewater should
be disolved. McDougal and the Clintons had very
different interests in Whitewater. To the Clintons, it
was a pure investment. Investments of that sort pay off
pretty quickly or not at all. There is typically no
pourpose in additional investment if the initial
investment is insufficient: in that case, it is a
loosing bet and additional investment throws good money
after bad. McDougal was a promoter. Nothing would be
worse for him than for people to know he had lost the
Governor money. His other businesses were shakey, and a
failure might cause the whole house of cards to
collapse. So McDougal had to keep Whitewater afloat.
In fact, doing so did not benefit the Clintons at all.

Also, Whitewater was not a `real estate investment
firm' as that description is normally understood, but a
real estate development. (Investment firm makes it
sould as if it had other irons in the fire.)

6. and steering monthly payments to Clinton's wife.

See 1. above.

7. showing among other things that she had undertaken
crucial legal work on a questionable transaction that led to
McDougal's undoing.

This is a murky area. If I understand it, Hillary
Clinton wrote the documents associated with teh sale of
property between McDougal and Seth ???. The sale was
arguably a sham (not at arms length) and designed to
provide a record showing an inflated value for real
estate. I do not actually know what responsibilty a
lawyer has in this situation, if any. Someone comes in and
says `Please write up the documents so I can sell this
property to Joe here for 100,000 dollars.' Does the
lawyer have to ask whether the property is worth that,
whether the tranaction is arms length, etc. If the
people say, yes, worth that much, yes arms length, must
the lawyer check this independently? I do not know, but
I doubt it. As usual, details of the `crucial legal
work' is left out.