THE TROUBLE WITH BILLY

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP90-00552R000100990037-4
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 3
• Document Creation Date: December 22, 2016
• Document Release Date: June 24, 2010
• Sequence Number: 37
• Publication Date: August 11, 1980
• Content Type: OPEN SOURCE

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in the country are not hearing it," Panetta
told him point-blank. He left uncertain
whether the President had heard either.
The bullishness was rather more recip-
rocal when Carter met late in the week
with 400 more of his own delegates-the
third wave he had invited down to the White
House for a day's briefing, bracing and
stroking at the eve of the convention. The
signal of their distance from the hothouse
intrigue of Washington was their greeting
to the Carters in the East Room-a raucous
din of whoops, hollers, whistles and chants
of "Four more years!" and "We want Jim-
my!" The President talked a bit about the
rules fight, allowing that there might be
some division in the room. "No-o-o-o-o!"
came an answering roar from the delegates.
Carter told them he had no intention of
budging in any event-that to do so would
make "a travesty" of convention reforms.
"It's almost incomprehensible to me," he
said with some asperity, "how a brokered,
horse-trading, smoke-filled-room conven-
tion could be labeled `open'."
Negative Mo: Carter's transcendent
calm was not completely shared by his own
people-not outside the little circle of Geor-
gians immediately around him. No one
doubted that he would win renomination
or that he would come out of the Great
Billy Inquiry absolved of any sin larger
than a failure to have been his brother's
keeper. But second- and third-tier staffers
were seized by the growing disquiet about
Carter's collapse in the polls and his pros-
pects for November. "A lot of people at
the White House and the campaign are
just going through the motions," a mid-
level aide said. "They think this thing is
irretrievable." Some, indeed, were thinking
ahead to their next jobs and contemplating
graceful exits. "We've acquired a negative
momentum," one fretted, "and I don't
think anyone knows how to turn it around."
Older Democratic hands, in and out of
the White House, thought there was still
a way-making Ronald Reagan the issue
instead of Jimmy Carter. The President
himself rehearsed the politics of attack be-
fore his convention delegates during the
week, reminding them that "our nation was
almost brought to the knees" by a Repub-
lican scandal called Watergate. But his
opening salvos against the other side were
swallowed up in the clangor of rebellion
in his own party and in the rush of the
press and the Congress to get the goods
on Billy-a serial nightmare likely to haunt
the President deep into autumn. Even his
convention promises now to add to his bur-
dens rather than lighten them. The gath-
ering of the Democratic clans in New York
ought, by historic precedent, to have been
a celebration of his life, his works and his
renomination. Instead, it has become a fur-
ther trial that he and his sundered party
will be happy merely to survive.
PETER GOLDMAN with ELEANOR CLIFF,
THOMAS M. DeFRANK;'HENRY W. HUBBARD,
GLORIA BORGER, JOHN WALCOTT and FRED
COLEMAN in Washington and bureau reports
The Trouble WithIiy
T he Billy Carter affair continued last
week to produce great billows of smoke
and very little fire. After days of letting
aides speak for him, the President suddenly
went on national television to proclaim that
he was eager to answer all questions about
his role in his brother's controversial re-
lationship with the Libyan Government.
The very next day a Republican congress-
man disclosed that an FBI report quoted
Billy Carter as claiming that the President
had given him official State Department
cables dealing with his 1978 visit to Libya.
The White House first responded shakily
that Carter didn't "recall" doing any such
thing, and Billy denied it outright. But then
he reversed himself and admitted getting
at least one State Department cable from
Bernie Boston-Washington Star
the White House. After twelve uneasy
hours, the Administration confirmed Bil-
ly's statement. Groaned one White House
operative: "Every time you turn around,
another shoe drops."
Once again, the White House was on
the defensive, scrambling frantically to re-
but the charges of favoritism and bad judg-
ment that have dogged it ever since Billy
Carter's Libyan connection first swirled
into the headlines. As it turned out, the
controversial cables proved to be nothing
more than an innocuous series of previously
declassified messages about the progress
of Billy's trip. All were marked with the
relatively minor classifications "limited of-
ficial use" or. "confidential"-the 'lowest
st'
security categories-and, as State Depart-
ment insiders quickly confirmed, they were
typical of the sort of cables that are rou-
tinely turned over to businessmen and jour-
nalists. As White House press secretary
Jody Powell argued, even if Carter had giv-
en them to his brother, "it wouldn't have
amounted to a hill of beans."
But it took the White House two full
days to set the record straight, adding im-
petus to the dump-Carter movement on
Capitol Hill and extending the Adminis-
tration's record of awkwardness in dealing
with the controversy. The White House
strategy was to try to separate the President
from his brother's woes and get the whole
story out into the open as soon as possible.
But that was proving difficult. For one
thing, Billy's troubles seemed
to be getting worse. His chief
inquisitor, attorney Joel Lisker
of the Justice Department's
Foreign Agents Registration
Unit, said last week that Bil-
ly had repeatedly lied to gov-
ernment agents about the
$220,000 he received from his
Libyan friends-and Billy,
never noted for his precision
with words, didn't help matters
by changing his account almost
daily. For another, the Presi-
dent himself faced a highly un-
usual cross-examination by a
hastily organized Senate inves-
tigating subcommittee chaired
by Sen. Birch Bayh of Indiana.
`No Effect': The President
went off to Camp David at the
weekend to write a detailed re-
port on his role in the Billy
affair that he would send to
the Bayh subcommittee early
this week. He said he would
then answer questions in a
prime-time news conference.
The Bayh subcommittee re-
sponded by voting to try to fin-
ish all testimony by the end
of August-before the fall
Presidential campaign begins.
According to a NEWSWEEK Poll (page 22),
Americans were divided on the question
of how well the President had handled him-
self in the controversy, but most of those
surveyed said Billy's conduct had no effect
on their opinion of President Carter.
The furor over the State Department ca-
bles began early last week after the Justice
Department sent a copy of its complete
file on Billy's case to the House Judiciary
Committee. After perusing the four-volume
compendium, Republican Congressman
Harold Sawyer announced to reporters that
it contained an FBI report indicating Billy
had boasted to Lisker that the President
had given him some cables. Lisker himself
later confirmed the account. As he told
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NATIONAL AFFAIRS
it, Billy made the claim at a Jan. 16 meeting
requested by Lisker to determine whether
the President's brother should be required
to register as a foreign agent. Lisker said
he had laid a stack of unclassified State
Department cables on a coffee table-
which prompted Billy to remark: "I see
you have the CIA stuff."
"CIA?" Lisker replied. "No, that's
State."
"It's all the same," Lisker recalled Billy
saying. "I've seen that stuff... Jimmy gave
'em to me. I've got it out at my house."
At home in Americus, Ga., last week;
Billy first insisted that Lisker had it all
wrong. "I have State Department copies
of nothing," he said. "Jimmy has not shown
me anything." At the White House, how-
ever, the denials were not quite so cate-
gorical. With Powell home in bed-a victim
of exhaustion and a few too many late-
night beers-it fell to White House counsel
Lloyd Cutler and deputy press secretary
Ray Jenkins to fashion a response. Their
statement had a ring of legalistic evasion,
noting that while the President remem-
bered discussing some cables with Billy,
"he does not now recall" showing him any
texts or giving him any copies.
Bland: That Watergate-style response
prompted a blizzard of overwrought head-
lines the next day that propelled Powell
out of his bed and back into the office.
Greeting the press with a cat-that-swal-
lowed-the-canary grin, he distributed
copies of seven cables concerning Billy's
visit to Libya in September 1978-most
of which, he pointed out, had been declas-
sified fourteen months ago when syndicated
columnist Jack Anderson requested to see
them under the Freedom of Information
Act. The cables made bland reading, con-
sisting mainly of reports to the State De-
partment from the U.S. Embassy in Tripoli
on Billy's activities there. "Billy Carter has
told us that he will refrain from making
any political comments, and this has been
borne out thus far," one noted. "For ex-
ample, in reply to a long welcoming speech
at the airport Billy shook
hands and most amiably said
'Thank you'. The only cable of
the bunch categorized as "confi-
dential" was a "trip report" by
Charge d'Affaires William Eagle-
ton that assessed Billy's visit as
"a very positive event which has
opened some doors for this em-
bassy and raised the morale of the
American community."
Still, Powell waffled over
whether the President had shown
Billy any of the cables. Given the
White House's apprehension
about Billy's trip to Libya, he said,
the news that Billy behaved well
was a "subject of some relief to
the President"-Ind he may well
? have mentioned the kudos to his
and an FBI agent. When Lisker asked him
if he had received anything of value from
the Libyans, Billy admitted getting only
four gold bracelets, a saddle, a sword, a
serving platter and, on one of his trips to
Libya, 200 dinars (roughly $690) in spend-
ing cash-which he said. he asked his aide
de camp, Henry R. (Randy) Coleman, to
donate to the American school in Tripoli.
Six months later, at a June 11 meeting with
Lisker and deputy assistant attorney gen-
eral Mark Richard, Billy reportedly stuck
by his January report. By then, however,
the Justice Department knew otherwise-
and Lisker decided to call Billy's bluff.
Deposit Slip: "Billy," he told him, "we
have many sources of information, and our
sources lead us to conclude that's not an
accurate statement." "Well," Billy is said
Bruce Hoertel to have replied, "there was a loan of
Lisker: Billy lied at least three times $200,000 and a reimbursement for expenses,
for $20,000." According to Lisker, Billy
brother"to encourage [his] good behavior." explained that he got the money in March,
The day after Powell released the cables, and that the S20,000 represented partial
Billy admitted that "somebody in the White compensation for the $40,000 he said he
House" had in fact sent him a copy of had spent entertaining a Libyan delegation
the cable praising the impact of his visit. that visited Georgia in January 1979.
Twelve hours later, Powell confirmed it. That assertion, Lisker claimed last week,
A search of the records, he said, had dis- was almost entirely untrue. For one thing,
closed that ten days after Billy completed he said, the Justice Department turned up
his first trip to Libya, aides had shown a deposit slip from a Columbus, Ga., bank
the President a copy of Eagleton's favorable showing that Billy put the $20,000 payment
trip report. Carter scrawled a brief note from the Libyans into his account on Dec.
congratulating his brother for the "good 31, 1979. For another, Lisker said that Billy
job" he had done "under the 'dry' circum- had told him in January that the cost of
stances" in teetotaling Libya and ordered entertaining the Libyan delegation was less
it mailed to Billy. White House staffers than $7,500. And when Billy finally reg-
quickly pointed out that such low-level ca- istered with the Justice Department as a
bles are routinely distributed to VIP tour- foreign agent, he listed both payments as
ists who earn favorable mentions. "They're "loans"-even though he could offer no
just like confetti," said one. supporting documentation.
But if the cable affair didn't amount to Billy minced no words in responding to
anything of substance, Billy got himself into the accusations. "Lisker's full of shit," he
even deeper water over what he described told reporters who joined him for breakfast
as his'$220,000 "loan" from the Libyans. the next day at the Best Western Motel
Lisker accused Billy last week of having in Americus. Lisker, a former FBI agent
lied to him about the money on at least and a nine-year veteran of the Justice De-
three occasions-and, he added, "I would partment's criminal division, was unfazed
venture to say there are probably others." by Billy's angry refutation. "The record,"
As Lisker told it, Billy lied for the first he said simply, "speaks for itself."
time at his Jan. 16 meeting with Lisker While Billy blustered and White House
Personal touch: Partial text of a State Department cable and Jimmy's note to Billy
F`t AMEMMBASSY TRIPOLI
TO SECSTATE WASHDC 0000
SUBJECT: BILLY CARTER'S VISIT TO TRIPOLI
CONFIDENTIAL
PAGE03 . TJtIPOL01387 012034Z
5. AS FAR AS WE CAN SEE. THERE HAS BEEN NO NEGATIVE
FALLOUT FROM BILLY CARTER'S VISIT TO TRIPOLI. IN FACT.
ON THE LOCAL SCENE WE WOULD RATE IT A VERY POSITIVE
EVENT WHICH HAS OPENED SOME DOORS FOR THIS EMBASSY
AND RAISED THE MORALE OF THE AMERICAN COMMUNITY.
FURTHERMORE. IT HAS BROUGHT THE EMBASSY. THE AMERICAN
LIBYAN
COMMUNITY. AND AN IMPORTANT ELEMENT OF THE
GOVERNMENT (THE LIAISON BUREAU)TOGETHER IN A WAY
WHICH COULD PROVE USEFUL IN THE FUTURE.
EAGLETON =
CONFIDENTIAL
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Jim Wri hts
testify or invite the panel to the White te Politics of Oil
aides frantically searched their files for any House remains to be worked out. When
ngres -
on of
other potentially embarrassing revela- he does appear, he will face a wide range 'of
traditi
Texas
to a
have
handlers
question
ugh
Department had no access to t Justiceof ins sted all alongsthatrthesP resident isn't sional mastery that stretches back to Sam
urn
dossier li' on its investigation
remains
bushy-
d was etting itself or- that it was the Pres d nt,Lh is wife and some or ty L ader Jaymes Wn right 57, is a House a-
g ting subcommittee cBay the
aniz. The subcommittee g g invol
ved ona f counsel suchoped onSethe the qa uestionable diplomatic effort to free the grip on Ft. Worth's Twelfth Congressional
le a chief cthis week. , g hostages in Iran and who at least periph- District has endured for 26 years. Four
won the House's No. 2 job,
mading contenders: Whitney North Sey- our
Southern J, former U.S. e York, and Harold the Justice Department beganm losing when years in. and heghases since consolidated his claim
R. Tyller er Jr., a a former attorney get- The Bayh subcommittee will review the to someday succeed Speaker Thomas
Wriht
R. Tyler deputy
eral in the Ford Administration. circumstances under which the Attorney (Tip) O'Neill, now 67. But this year, g
the Pres dent's dent, and it will look into allegations that who charges that he hasforsaken his Texas it, "tbe General discussed the case with the Presi- faces a well-financed Republican opponent
`Sooner the Better': As Bayh
real question" had was whether
found himself iem-
- ti tipped off Billy to the fact that the Justice and last place in the national
brother
government." been able to "influence
that
ly indicated dithat President himself quick- happy twould
was get g ffound out about the mon- rom the Libyans. Mean- smacked of conflict of interest.
the na ion in h is eye he partment
isclosure
the
l was
happy to respond, respond, telling
televised statement that
that was ager the suing a sie milar i inquiry and itself Wright had gonelt bat fora wealthy Ft
sooner lay all those concerns s to rest
sooner the better." The President's eager- opened a criminal investigation to deter- Worth oilman, W. A. (Monty) Moncrief,
of next gave Billy other classified material. So far into a promising natural-gas venture np east
toss stemmehis d at least partly from
week's lay out Democratic tb convention-and do start subcommittee mbers worried that he of justice or any other major impropriety grandson vwanted to let som came of his friends
t
might want tm
might want to meet with them before they by the White House-and the White House in on it," the 84-year-old Moncrief told "Jim were ready for him. "If he does come [this insists that even the toughest investigation TT he Dallas tT m here erald
the samW time right
met and
week]," cautioned co-chairman Strom won't turn up any.
Thurmond, "it should be with the under- ALLAN J. MAYER with ELAINE SHANNON, he took an interest in it." Wright said
ELEANOR CLIFF, THOMAS M. DeFRANK and he kicked in about $35,000 to develop a
standing that ... after the convention he KIM WILLENSON in Washington and
would be subject to being called again." VERN E. SMITH in Americus, Ga. gas well southeast of Dallas; the newspa-
Ronald Reagan's Taxes
After refusing for years to make his personal finances public,
Ronald Reagan released his 1979 tax return-last week. Filed
jointly with wife Nancy, the 23-page form shows the Republican
Presidential nominee to be both a millionaire and a bit of
a penny pincher. Listing his occupation as "private business"
and Nancy's as "none," Reagan reported adjusted gross income
of $515,878 last year. He paid more than half that-$262,936-
in Federal, state and local taxes. The 'Reagans claimed four
personal exemptions-two for themselves, one for son
Ron who lived at home last year, and an extra one for the
. candidate because he is over 65.
The bulk of Reagan's earnings
came from speaking engagements
($380,500), from radio broadcasts
,($58,453) and from his syndicated
newspaper column and other writ-
ing ($26,757). Expenses of
$166,733-mostly to the Los An-
gels public relations firm of
Deaver and Hannaford-reduced
that business income to $298,977.
In divesting himself of nearly $1
million in stock before the Presi-
dential race, Reagan turned a
ities. The couple own their Pacific Palisades home in full,
the records reveal, and they paid only $5,282 in property taxes
on it and their 688-acre ranch, which was assessed as a farm.
Sale of the fourteen steers they raised there last year brought
in $3,024-but that was more than offset by expenses including
$2,363 in repairs to a Jeep, $598 for feed and S367 for horse
shoeing fees.
`Philosophically Opposed': Reagan's return shows him to
be careful with his money. He reported receiving $481 interest
on a loan to his 39-year-old daughter, Maureen. He con-
tributed only $4,108 to charities-less than I per cent of
his income-and took only a $12 credit for donations to
( e
At home: Scrupulous records for tax pruning
$234,455 profit, but only $93,809
of that was taxable under capital
gains laws. Reagan also earned
$90,394 in interest, $23,954 in
dividends from bank trusts and
$17,600 from his California gov-
ernor's pension and other annu-
candidates for public o ce
could have taken a tax credit of
up to $100 if he had given more).
The Reagans both checked "no"
on the option to devote $1 each
of their taxes to help finance
Presidential campaigns. ("He's
philosophically opposed to that,"
explained Lyn Nofziger, a top of-
ficial of the Reagan campaign,
which has just received $29.4 mil-
lion in Federal funds for the fall
race.) Apparently a scrupulous
record-keeper, Reagan . listed
$2,148 in state sales taxes, rather
than using the income-based es-
timate provided with the tax
form. He also claimed $15 in de-
preciation-on a fan at his ranch
in California and $12 in finance
charges on his credit cards.
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