THE TROUBLE WITH BILLY

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CIA-RDP90-00552R000100990037-4
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3
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December 22, 2016
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June 24, 2010
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37
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Publication Date: 
August 11, 1980
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Sanitized Copy Approved for Release 2010/06/24: CIA-RDP90-00552R000100990037-4 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 Sanitized Copy Approved for Release 2010/06/24: CIA-RDP90-00552R000100990037-4 Sanitized Copy Approved for Release 2010/06/24: CIA-RDP90-00552R000100990037-4 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 Sanitized Copy Approved for Release 2010/06/24: CIA-RDP90-00552R000100990037-4 Sanitized Copy Approved for Release 2010/06/24: CIA-RDP90-00552R000100990037-4 = - ---;, 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. Sanitized Copy Approved for Release 2010/06/24: CIA-RDP90-00552R000100990037-4