Living History (15 page)

I’m sure I inherited my concerns from my notoriously frugal father, who made smart investments, put his kids through college and retired comfortably. My dad taught me how to follow the stock market when I was still in grade school and frequently reminded me that “money doesn’t grow on trees.” Only through hard work, savings and prudent investing could you become financially independent. Still, I had never given much thought to savings or investments until I realized that if our growing family were going to have any financial cushion, it would be mostly my responsibility. I started looking for opportunities I could afford. My friend Diane Blair was married to someone who knew the intricacies of the commodities market, and he was willing to share his expertise.

With his gravelly drawl, large frame and silver hair, Jim Blair was an imposing figure and an exceptional lawyer whose clients included the poultry giant Tyson Foods. Jim also held strong political opinions. He championed civil rights, opposed the Vietnam War and supported Senators Fulbright and McGovern against the political tides. He was blessed with a great personal warmth and a mischievous sense of humor. When he married Diane, he found a soul mate, as did she. Bill performed their wedding ceremony in 1979, and I served as their “best person.”

The commodities markets were booming in the late 1970s, and Jim had developed a system of trading that was making him a fortune. By 1978, he was doing so well that he encouraged his family and best friends to jump into the market. I was willing to risk $1,000 and let Jim guide my trades through the colorfully named broker Robert “Red”

Bone. Red was a former poker player, which made perfect sense, given his calling.

The commodities market is nothing like the stock exchange-in fact, it has more in common with Las Vegas than Wall Street. What investors buy and sell are promises (known as “futures”) to purchase or sell certain goods―wheat, coffee, cattle―at a fixed price. If the price is higher when those commodities are brought to market, the investor makes money. Sometimes it’s a great deal of money, because each dollar invested can control many times its value in futures. Price fluctuations of a few cents are amplified by huge volumes. On the other hand, if the market in hog-bellies or corn is glutted, then the price drops and the investor loses big.

I did my best to educate myself about cattle futures and margin calls to make it less frightening. I won and lost money over the months and followed the markets closely. For a while I opened a smaller, broker controlled account with another investment firm in Little Rock. But soon after I got pregnant with Chelsea in 1979, I lost my nerve for gambling.

The gains I had made suddenly seemed like real money we could use for our child’s higher education. I walked away from the table $100.000 ahead. Jim Blair and his compatriots stayed in the market longer and lost a good deal of the money they had made.

The large return on my investment was examined ad infinitum after Bill became President, although it never became the focus of a serious investigation. The conclusion was that, like many investors at the time, I’d been fortunate. Bill and I weren’t so lucky with another investment we made during the same period. Not only did we lose money on a piece of property called Whitewater Estates, the investment would spawn an investigation fifteen years later that endured throughout Bill’s Presidency.

It all started one day in the spring of 1978 when a businessman and longtime politico named Jim McDougal approached us with a sure-thing deal: Bill and I entered a partnership with Jim and his young wife, Susan, to buy two-hundred-thirty undeveloped acres on the south bank of the White River in North Arkansas. The plan was to subdivide the site for vacation homes, then sell the lots at a profit. The price was $202,61l.20.

Bill had met McDougal in 1968 when Jim was working on Senator J. William Fulbright’s reelection campaign and Bill was a twenty-one-yearold summer volunteer. Jim McDougal was a character: charming, witty and eccentric as the day is long. With his white suits and baby blue Bentley, McDougal looked as if he’d just stepped out of a Tennessee Williams play. Despite his colorful habits, he had a solid reputation. He seemed to do business with everybody in the state, including the impeccable Bill Fulbright, for whom he helped make a lot of money in real estate. His credentials were reassuring to both of us. Bill had also made a small real estate investment with McDougal the year before that had turned a reasonable profit, so when Jim suggested Whitewater, it seemed like a good idea.

The North Arkansas Ozarks were booming with second homes for people flocking down south from Chicago and Detroit. The attraction was obvious: forested land with low property taxes in gently rolling countryside bordered by mountains and laced with lakes and rivers that offered some of the best fishing and rafting in the country. If all had gone according to plan, we would have turned over the investment after a few years and that would have been the end of it. We took out bank loans to buy the property, eventually transferring ownership to the Whitewater Development Company, Inc., a separate entity in which we and the McDougals had equal shares. Bill and I considered ourselves passive investors; Jim and Susan managed the project, which was expected to finance itself once the lots started to sell. But by the time the development was surveyed and lots were ready for sale, interest rates had gone through the roof, climbing close to 20 percent by the end of the decade. People could no longer afford to finance second homes. Rather than take a huge loss, we held on to Whitewater, making some improvements and building a model home while hoping for an economic turnaround. From time to time, over the next several years, Jim asked us to write checks to help make interest payments or other contributions, and we never questioned his judgment. We didn’t realize that Jim McDougal’s behavior was turning the corner from “eccentric” to “mentally unstable” and that he was becoming involved in a raft of dubious business schemes. It would be years before we learned anything about his double life.

Nineteen eighty was a big year for us. We were new parents, and Bill was running for reelection. His opponent in the primary election was a seventy-eight-yearold retired turkey farmer, Monroe Schwarzlose, who spoke for a lot of rural Democrats when he criticized the increase in the cost of car tags and capitalized on the impression of some that Bill was “out of touch” with Arkansas. Schwarzlose ended up getting one-third of the vote. It didn’t help that Jimmy Carter’s Presidency was beset by problems. The economy was slowly sinking as interest rates continued to climb. The administration was sidetracked by a series of international crises, culminating in the taking of American hostages in Iran. Some of those troubles spilled over into Arkansas in the spring and summer of 1980, when hundreds of detained Cuban refugees―mostly inmates from prisons and mental hospitals whom Castro released to the United States in the infamous Mariel boat lift―were sent to a “resettlement camp” at Fort Chaffee, Arkansas. In late May, the refugees rioted and hundreds broke out of the fort, heading toward the nearby community of Fort Smith. County deputies and local citizens loaded their shotguns and waited for the expected onslaught. The situation was made worse because the Army, under a doctrine known as posse comitatus, had no police authority off the base and were not even empowered to forcefully keep the detainees―who were not technically prisoners―on the grounds. Bill sent state troopers and National Guardsmen to round up the Cubans and control the situation. Then he flew up to oversee the operation.

Bill’s actions saved lives and prevented widespread violence. When Bill went back a few days later to follow up, I joined him. There were still signs on gas stations: “All out of ammo, come back tomorrow,” and in front of homes: “We shoot to kill.” I also attended some tense meetings Bill held with James “Bulldog” Drummond, the frustrated general in command of Fort Chaffee, and representatives from the White House. Bill wanted federal assistance to contain the detainees, but General Drummond said his hands were tied because of orders from above. The White House message seemed to be: “Don’t complain, just handle the mess we gave you.” Bill had done just that, but there was a big political price to pay for supporting his President.

After the June riots, President Carter had promised Bill that no more Cubans would be sent to Arkansas. In August, the White House broke that promise, closing sites in Wisconsin and Pennsylvania and sending more refugees to Fort Chaffee. That reversal further undermined support for Bill Clinton and Jimmy Carter in Arkansas. Southerners have an expression to describe something or someone whose luck turns all bad. By now it was clear that Jimmy Carter’s Presidency was snake-bit. It was harder to admit that Bill Clinton’s Governorship was suffering the same fate.

Bill’s Republican opponent, Frank White; began running negative ads. Against footage of dark-skinned Cuban rioters, a voice-over announced that “Bill Clinton cares more about Jimmy Carter than he does about Arkansas.” I initially dismissed the ads, thinking that everyone in Arkansas knew what a good job Bill had done containing the violence.

Then I started fielding questions at school assemblies and civic clubs: “Why did the Governor let the Cubans riot?” “Why didn’t the Governor care about us more than about President Carter?” Ads like this one, which demonstrated the power of a negative message, became all too common in 1980, largely because of a strategy employed by the National Conservative Political Action Committee (NCPAC), formed by the Republicans to design and run negative ads all over the country. By October, I thought the polls showing Bill ahead were wrong and that Bill might actually lose. Bill had used a young, abrasive New York pollster, Dick Morris, for his successful 1978 race, but no one on his staff or in his office could stand working with Morris, so they persuaded Bill to use a different team in 1980. I called Morris to ask what he thought was happening. He told me Bill was in real trouble and probably would lose unless he made some kind of dramatic gesture, like repealing the car tag tax or repudiating Carter. I couldn’t persuade anyone else to ignore the polls that showed Bill winning. Bill himself was uncertain. He didn’t want to break publicly with the President or call a special session to repeal the car tag hike. So he just upped his campaigning and kept on explaining himself to voters.

Right before the election, we had a disturbing conversation with an officer in the National Guard who had been in charge of some of the troops called up to quell riots at the base. He told Bill that his elderly aunt had informed him that she intended to vote for Frank White because Bill had let the Cubans riot. When this officer explained to his aunt that he had been there and knew for a fact that Governor Clinton had stopped the rioting, his aunt said that wasn’t true because she had seen what happened on television. The ads trumped not just the news, but personal witness. That 1980 campaign, where truth was turned on its head, convinced me of the piercing power of negative ads to convert voters through distortion.

Exit polls showed Bill winning by a wide margin, but he lost, 52 to 48 percent. He was devastated. The big hotel room his campaign had rented was filled with shocked friends and supporters. He decided he would wait until the next day to make any public comments and asked me to go and thank everyone for their help and invite them to come over to the Governor’s Mansion the following morning. The gathering on the back lawn was like a wake. Bill had now lost two elections―one for Congress, one as an incumbent Governor―and many wondered whether this defeat would break him.

Before the week was out we found an old home to buy in the Hillcrest section of Little Rock, near where we had lived before. On two lots, it had a converted attic that we used for Chelsea’s nursery. Bill and I are partial to older homes and traditional furniture, so we haunted thrift stores and antique shops. When Virginia visited, she asked us why we liked old things. As she explained, “I’ve spent my whole life trying to get away from old homes and furniture.” When she figured out our taste, though, she cheerfully sent over a Victorian “courting couch” she had in her garage.

Chelsea was the only bright spot in the painful months following the election. She was the first grandchild in our families, so Bill’s mother was more than happy to do a lot of babysitting, as were my parents when they came to visit. It was in our new house that Chelsea celebrated her first birthday, learned to walk and talk and taught her father a lesson in the perils of multitasking. One day Bill was holding her while watching a basketball game on television, talking on the phone and doing a crossword puzzle. When she couldn’t get his attention, she bit him on the nose!

Bill took a job at Wright, Lindsey and Jennings, a Little Rock law firm. One of his new colleagues, Bruce Lindsey, became one of Bill’s closest confidants. But before Frank White had moved into the mansion, Bill was unofficially campaigning to get his job back.

The pressures on me to conform had increased dramatically when Bill was elected Governor in 1978. I could get away with being considered a little unconventional as the wife of the Attorney General, but as First Lady of Arkansas, Iwas thrown into an unblinking spotlight. And for the first time, I came to realize how my personal choices could impact my husband’s political future.

My parents raised me to focus on the inner qualities of people, not the way they dressed or the titles they held. That sometimes made it hard for me to understand the importance of certain conventions to others. I learned the hard way that some voters in Arkansas were seriously offended by the fact that I kept my maiden name.

Because I knew Ihad my own professional interests and did not want to create any confusion or conflict of interest with my husband’s public career, it made perfect sense to me to continue using my own name. Bill didn’t mind, but our mothers did. Virginia cried when Bill told her, and my mother addressed her letters to “Mr. and Mrs. Bill Clinton.”

Brides who kept their maiden names were becoming more common in some places in the mid-1970s, but they were still rare in most of the country. And that included Arkansas. It was a personal decision, a small (I thought) gesture to acknowledge that while I was committed to our union, I was still me. I was also being practical. By the time we married, I was teaching, trying cases, publishing and speaking as Hillary Rodham. I kept my name after Bill was elected to state office partly because I thought it would help avoid the appearance of conflict of interest. And there’s one case I think I would have lost had I taken Bill’s name.