Much Ado About Deaver

By Evan Thomas

Pity, if you can, Michael Deaver. Last week he surrendered the White House pass that Ronald Reagan had allowed him to keep when he left the Administration a year ago. He has stopped receiving the President's daily- appointments schedule. For fear of embarrassing the First Family, he says, he no longer feels free to use the White House tennis court. Deaver has also had to break off negotiations for an $18 million sale of his consulting firm to a British public relations conglomerate, Saatchi & Saatchi. And if that were not enough bad news, the General Accounting Office reported last week that he may have violated federal conflict-of-interest laws that carry criminal penalties.

The former White House deputy chief of staff turned high-priced lobbyist continues to maintain steadfastly that he has not abused his close relationship with Reagan. But at week's end, when Deaver tried to make his way into the Capitol to defend his actions before a closed-door session of a congressional subcommittee, he found himself at the center of a rising storm over influence peddling in Washington. Reporters mobbed him, cameramen jostled him, and flashing strobe lights so blinded him that he walked right past the committee-room door. "After five months of rumor, leaks and innuendo," Deaver bravely declared, "today is my day." But it was clear that the media's feeding frenzy had just begun and that the capital had been seized by one of its periodic fits of morality.

The flap over Deaver may have more to do with what he represents than what he did. "He's just a symbol of what's wrong with our system," says Democratic Senator David Pryor of Arkansas. "There's a sense we've all allowed this situation with lobbying fees, big-money elections and influence peddling to get out of control."

Deaver is the target of probes by the GAO, the Justice Department and the Oversight and Investigations Subcommittee of the House Energy and Commerce Committee. At issue is whether he illegally represented private clients on matters he dealt with as an Administration official. Deaver has asked that an independent counsel be appointed to look into the charges.

Among other matters, the congressional probers are investigating: Deaver's role in negotiating a settlement for the Daewoo Corp., a big South Korean steel- maker that violated American import restrictions; his efforts on behalf of Rockwell International to persuade the Government to buy more B-1 bombers; and his lobbying for Puerto Rico to retain tax breaks worth $600 million a year to the island's economy. So far, the investigations have publicly produced no evidence of wrongdoing. They have stirred up some smoke, however, by poking into Deaver's efforts on behalf of Canada concerning the issue of acid rain.

Deaver may have participated in as many as 15 U.S.-Canadian discussions of acid rain before he left the White House last May, said James F. Hinchman, the GAO deputy general counsel, who testified last week before the investigations subcommittee chaired by Democratic Congressman John Dingell of Michigan. For example, said Hinchman, Deaver actively supported a proposal, later accepted by the Reagan Administration, that the U.S. and Canada appoint special envoys to deal with the acid-rain problem. Less than a week after he quit his White House job, Deaver began talks with Canadian officials that eventually led to a $105,000 contract to lobby for Canada.

Federal law bars former Executive Branch employees from ever lobbying the Government on a "particular matter" in which they "personally and substantially" participated while in office. Violators can be fined up to $10,000 and sentenced to two years in prison. Deaver insists that "I was never involved personally or substantially on the substantive issue of acid rain. I couldn't tell you today what acid rain means." According to the GAO, however, Deaver and Canadian officials met with Drew Lewis, the special U.S. envoy on acid rain, to discuss the content and timing of the envoy's report, which recommended a $5 billion clean-up plan.

The GAO's Hinchman also stated that Deaver may have violated Government ethics laws by "his very presence" at the meeting with Lewis. Deaver is barred from officially contacting anyone in the White House for a year after leaving office, and the GAO found that Lewis should have been considered a White House official. Deaver maintains that Lewis, though he is a White House appointee who keeps an office in the nearby Old Executive Office Building, is in fact a State Department employee.

The Deaver affair has also raised some political ruckus in Canada, where opposition Liberal Party members suggested that Conservative Prime Minister Brian Mulroney's government may have knowingly violated U.S. laws by hiring Deaver. In particular, they questioned the possible role played by Allan Gotlieb, Canada's highly regarded Ambassador to Washington, in recruiting Deaver. The House of Commons' External Affairs Committee will decide this week whether to launch a formal investigation.

Former White House Counsel Fred Fielding was dragged into the growing mess by a member of the congressional panel, Representative Gerald Sikorski, Democrat from Minnesota. Sikorski charged that during a conflict-of-interest review of Deaver in February 1985, Fielding responded to a request from the Government Ethics Office by providing "incomplete information beneficial to Mr. Deaver" the day after an associate of Deaver's approached Fielding about going to work for Deaver's firm. Fielding denied that he had done anything improper.

Appearing before the committee in closed session at week's end, Deaver blasted his critics as "meanspirited" and "impertinent" and argued that allegations that he has used his relationship with the Reagans for personal gain are "an implicit attack on the integrity of the President." But back out in front of the cameras, his congressional inquisitors continued to wax indignant. Though they may not be able to pin any legal violations on Deaver, they railed against the appearance of impropriety. "The message in these times is that Government service can be turned into big bucks," huffed Congressman Ron Wyden, Democrat from Oregon. "My constituents are not asking about Section 207 (the conflict-of-interest provisions of the law) but saying, 'Is this really the normal way things are being done in Washington?' Lobbyists owe more than to merely avoid committing felonies."

Deaver's real offense, says one White House aide, may be that he "tried to get too rich, too fast and too publicly." Administration officials smell more than a whiff of politics in the charges aimed at Deaver. "This is a John Dingell publicity special," says the Reagan staffer. "If the economy was going bad or the President was in trouble, Deaver would be ignored. But what do the Democrats have to beat on us with? Nothing except trade (deficits) and Michael K. Deaver."

Lobbyists are divided over whether Deaver's doings will hurt their business and compel Congress to tighten the rules on influence peddling. "Nothing will really change inside Washington," says a former Carter Administration official turned lobbyist, who nonetheless adds, "This whole thing sullies the name of lobbying--I may have to go back to calling myself a consultant." Some believe that Congress may pass a bill introduced by Senate Judiciary Committee Chairman Strom Thurmond, Republican from South Carolina, that would ban certain top former Government officials from lobbying on behalf of foreign governments and corporations.

One benefit of the Deaver affair may have been to stiffen the will of Senators to resist the depredations of lobbyists on tax reform. After his bill had been turned into a mockery by successful special-interest pleading in public drafting sessions, Senate Finance Committee Chairman Bob Packwood decided to keep the lobbyists in the dark. In the privacy of closed-door sessions, the committee was able to hammer out truly sweeping reforms. "It got to the point where it was us (the Senators) against them (the lobbyists)," says Finance Committee Member Pryor. "It may have united us in those last few hours when we put the bill together." If the Deaver affair did indeed give tax reform an extra push, it would come as no small irony. By flaunting his connections, Deaver may have inadvertently helped his former boss to achieve his avowed No. 1 domestic priority.

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With reporting by David Beckwith/Washington