Carthage, Tenn. – On his 1998 tax returns under “supplemental income,” Vice President Al Gore lists a $20,000 royalty payment from Union Zinc Inc. for the right to mine zinc from his 88-acre farm here in the verdant hills of the Cumberland River valley. In the 25 years he has held the zinc lease, Mr. Gore has earned more than $450,000. The man who provided Mr. Gore with that farm and mineral lease is of some note as the 2000 presidential race begins.
Mr. Gore’s father, former Sen. Albert Gore Sr., acquired the land and mineral rights on what appears to be highly favorable terms from Armand Hammer, the late chairman of Occidental Petroleum Corp. Mr. Hammer, an influence peddler of the highest magnitude, trafficked in politicians of all parties and stripes; he pleaded guilty in 1975 to making illegal contributions to Richard Nixon’s campaign in the Watergate affair. But the closest and most sustained of Mr. Hammer’s connections seem to have been with the elder Mr. Gore and his family. It was the earliest of a number of controversial associations that tarnish the stiff Boy Scout image of Al Gore Jr.
As mentioned in yesterday’s story on George W. Bush, this two-part series is not a tale of smoking guns and indictable offenses. Yet voters should know the financial connections of candidates, though they probably will make their decisions on other grounds. And while the candidates will not appreciate questions being raised about the murky areas of their finances, the lessons of the Clinton era suggest that it is better to put matters on the table early, lest they rise Whitewater-like to haunt a new administration.
The Hammer-staged zinc payments were first disclosed by Charles Babcock of the Washington Post in 1992, as then-Sen. Al Gore Jr. campaigned on the presidential ticket with an Arkansas upstart named Bill Clinton. An Occidental Petroleum subsidiary, Occidental Minerals, had negotiated the generous terms for Occidental’s right to mine minerals beneath the land in 1972.
The senior Mr. Gore had set his sights on the land as early as 1970, Mr. Babcock reported. Occidental Minerals purchased the estate from a local widow in 1972; within a year, Mr. Gore Sr. had bought the property and sold it to his son. The $20,000 annual lease payment amounted to $227 an acre, much more than the $30 an acre Mr. Hammer’s company had been paying locally only a few years earlier. Until 1985, Mr. Babcock noted, Occidental paid Mr. Gore Jr. “$190,000 for the lease without mining under the property because it never built a mine in the area.” In 1985, it sold the lease to Union Zinc, which began mining operations. The mine has changed hands several times since and is now owned by Pasminco, an Australian company.
Mr. Babcock’s 1992 article said the lease payment was the senator’s “most important source of income after his salary.” In recent years, Mr. Gore’s steady zinc profit has been eclipsed by his environmental bestseller, “Earth in the Balance,” which has earned more than $1.1 million in royalties, according to the vice president’s tax returns and financial-disclosure statements.
After the elder Mr. Gore lost his 1970 Senate re-election bid, Mr. Hammer placed him on Occidental Petroleum’s board of directors and named him chairman of an Occidental subsidiary, Island Creek Coal Co. – posts that would bring him more than $500,000 per year.
The senior Mr. Gore died in December. He is survived by his wife, Pauline. The vice president was named executor and trustee of his father’s estate, and was given “sole discretion” to manage a trust on his mother’s behalf. The vice president’s 1998 financial disclosures value the estate in a range between $266,000 and $565,000, including a block of Occidental Petroleum stock listed at a value of between $250,000 and $500,000.
Local property records, however, place the value of Mr. Gore Sr.’s land holdings alone at more than $1.1 million. Mr. Hammer was generous with the younger Mr. Gore as well, beyond the zinc lease. Occidental Petroleum was one of the largest contributors to Mr. Gore’s successful 1990 bid for Senate re-election. The Hammer family and corporations made donations up to the legal maximum in all of Mr. Gore’s campaigns, according to Mr. Hammer’s former personal assistant, Neil Lyndon, writing in London’s Daily Telegraph.
Mr. Hammer was Mr. Gore’s guest at the 1981 inauguration of Ronald Reagan. In May 1987, Mr. Gore and Mr. Hammer were in Moscow for a convention of International Physicians Against Nuclear War, a group calling for the abolition of all nuclear weapons. Mr. Hammer received a humanitarian award from the group; Mr. Gore delivered a speech saying conventional arms should be cut along with nuclear weapons. A month later, Mr. Hammer hosted a luncheon for presidential candidate Gore in Los Angeles.
Mr. Lyndon wrote that the younger Mr. Gore regularly dined with Mr. Hammer and Occidental lobbyists in Washington, and that he and his wife, Tipper, attended Mr. Hammer’s lavish parties. “Separately and together, the Gores sometimes used Hammer’s luxurious private Boeing 727 for journeys and jaunts,” Mr. Lyndon noted. The former Hammer aide added that the “profound and prolonged involvement between Hammer and Gore has never been revealed or investigated.” Vice President Gore’s office did not respond to a request to discuss Mr. Hammer.
Mr. Hammer died in 1990 at 92. The Hammer myth, developed with great care during his lifetime, presented the billionaire industrialist as a generous patron of the arts and a champion of peace during the Cold War. But the reality behind the myth was far different.
In his penetrating 1996 book, “Dossier: The Secret History of Armand Hammer,” author Edward Jay Epstein demolished the elaborate biographical backdrops Mr. Hammer and his helpers erected. Drawing on FBI documentation and files from Moscow intelligence agencies, Mr. Epstein told the story of Mr. Hammer’s extensive business dealings with the Soviet Union. Mr. Hammer helped develop, and exploited for his business purposes, the image of a benign and profitable communist colossus, at a time when Stalin was murdering millions. Lenin himself, Mr. Epstein documents, told Stalin that Mr. Hammer was a “path leading to the American business world, and this path should be made use of in every way.” Mr. Hammer mined asbestos and brokered the production of tractors and pencils for Stalinist Russia. He cut lucrative fur deals. He trafficked in Czarist art, real and forged. He laundered millions for the Soviet Union in sham transactions. Later, Mr. Epstein reports, Mr. Hammer leapt into the big time by acquiring Libyan oil rights for Occidental Petroleum through a combination of shrewd dealing and bribery.
Much of this was not a secret in Cold War Washington, certainly not to J.Edgar Hoover. But Mr. Hammer also collected politicians, among them Albert Gore Sr. In 1950, Mr. Epstein writes, Mr. Hammer made then-Rep. Gore “a partner in a cattle-breeding business, and Gore made a substantial profit.” Over the years, as Mr. Gore rose in prominence and went on to the Senate, many favor-seekers traveled to Tennessee to purchase some very expensive cattle. The profits allowed the senator and his family to live in luxury at Washington’s Fairfax Hotel. In return, Mr. Gore provided several valuable services to Mr. Hammer, including fending off the FBI.
In 1972, a Hammer operative gave $54,000 in laundered hundred-dollar bills to Nixon fund-raiser Maurice Stans for use in the Watergate coverup. Questioned by the FBI and a Senate committee, Mr. Hammer lied about the money. But his flunkies crumbled under questioning. In 1975, Mr. Hammer pleaded guilty to three counts of making illegal campaign contributions. He spent the rest of his life campaigning for a pardon, which President Bush granted in 1989.
Mr. Hammer also had close ties to two lawyers who later would play important roles in the Clinton administration: Mickey Kantor, who served as commerce secretary, U.S. trade representative and White House damage-control specialist, and Gerald Stern, the Justice Department’s special counsel for financial-institution fraud. Mr. Stern was on Occidental Petroleum’s payroll as senior general counsel before coming to Washington. Mr. Kantor was a key player as outside counsel to Occidental when his law firm, Manatt, Phelps, Phillips & Kantor, waged a long and ultimately unsuccessful battle to open portions of the California coast to oil drilling.
Mr. Kantor was the 1992 Clinton-Gore campaign chairman and head of the transition team; Mr. Stern, a boyhood friend of Mr. Kantor’s, was staff coordinator of the transition team. At Justice, Mr. Stern managed the department’s largely fruitless efforts to get to the bottom of the BCCI banking scandal. A decade earlier, before Mr. Stern worked for Occidental, Mr. Hammer had been deeply involved in his own maneuvering to gain control of Financial General Bankshares, a Washington, D.C., bank holding company. When his takeover attempt did not succeed, Mr. Hammer sold his interest in Financial General to BCCI front men in 1981. BCCI was shut down in 1991 amid charges of global bank fraud.
Mr. Gore’s lifelong association with Armand Hammer casts some doubt on the popular impression that he was unsullied before accepting the vice presidential nomination on Bill Clinton’s ticket. In fact, some of the most controversial figures in the Clinton scandals came into the administration from the Gore camp. Craig Livingstone, the central player in the appearance of hundreds of FBI files at the White House, is a former Gore advance man. Nathan Landow, who entertained former White House volunteer Kathleen Willey while apparently trying to suppress her story about the president’s sexual advances, was a Gore fund-raiser, and remains one today. Mr. Landow has denied any wrongdoing in the Willey matter and no charges were brought against him.
And Mr. Gore had his own, independent connections with some of the Asian figures made famous by the Clinton scandals. His notorious appearance at a 1996 fund-raiser at the Hsi Lai Buddhist temple in California – where $65,000 was funneled to the Clinton-Gore effort through the use of Buddhist monks as conduits – followed a decade-long association with fundraiser Maria Hsia, who staged the temple event. A Senate Governmental Affairs Committee report identifies Ms. Hsia as “an agent of the Chinese government.” The six-volume report details the Gore connection with Ms. Hsia, as well as a lengthy relationship with campaign-finance figures James Riady and John Huang.
The dry committee report is engagingly retold for the nonobsessive in Bob Zelnick’s useful 1999 biography, “Gore: A Political Life.” “Gore and the Buddhists went back a long way,” Mr. Zelnick notes, “and always at the center of the relationship was money for the Tennesseean and his campaigns.” Ms. Hsia, Mr. Riady and Mr. Huang were instrumental in bringing then-Sen. Gore to Taiwan in January 1989 under the auspices of a lobbying group they had formed a year earlier, the Pacific Leadership Council. Mr. Riady’s Lippo Group provided the seed money for the trip; Mr. Huang handled the itinerary.
Following Sen. Gore’s 1989 trip, Ms. Hsia and the Pacific Leadership Council “helped run numerous fundraising events on his behalf,” the Senate Governmental Affairs Committee reported, “organizing Asian-American and Indo-Americans in Tennessee for Gore’s re-election.” Ms. Hsia, an immigration broker, “enlisted Senator Gore’s office in trying to help her arrange business deals – on a commission basis – between Tennessee businesses and Taiwanese business contacts.”
While offering few details, the Governmental Affairs Committee’s final report stated that Ms. Hsia had been “an agent of the Chinese government, that she acted knowingly in support of it, and that she has attempted to conceal her relationship” with it. Ms. Hsia is currently under indictment in the Buddhist Temple scheme; her attorney has denounced the charges as “absolutely false.”
Ms. Hsia also was no stranger to Peter Knight, the sometime Washington lobbyist who is Mr. Gore’s current senior fund-raiser. In his book, Mr. Zelnick reports that Mr. Knight and Leon Fuerth – Mr. Gore’s longtime national security assistant – urged Mr. Gore in 1988 to accept Ms. Hsia’s invitation to Taiwan. Mr. Knight’s interest, Mr. Zelnick suggests, was to develop the Asian-American community both on his boss’s behalf and to further his own career as a lobbyist.
In 1996, Mr. Knight signed on as campaign manager of the Clinton-Gore re-election effort. As the campaign-finance scandal unraveled, Mr. Knight and Mr. Landow – the Democratic fund-raiser involved in the Kathleen Willey affair – were widely criticized for squeezing a $100,000 donation out of the impoverished Cheyenne and Arapaho tribes of Oklahoma and attempting to extract business concessions from them.
Mr. Landow told the Washington Post that he met with the tribes only to be “polite” and did nothing improper in seeking further business with them related to mineral rights in a long-running land dispute with the federal government. These days, he is back in action on Mr. Gore’s behalf, helping raise $50,000 at a Maryland event in May. The vice president’s office did not respond to a request for details on Mr. Landow’s current role in the Gore campaign. Mr. Knight told the Post that he himself had only minimal contact with tribal representatives; according to the Post, his lobbying firm had been seeking a $100,000 retainer and a $10,000-a-month fee from the tribes in the land dispute.
Mr. Knight came under congressional scrutiny as well for his lobbying efforts on behalf of Molten Metals Technology, a Massachusetts toxic-waste cleanup firm that donated $90,000 to the Democrats in 1996. In a separate probe, the House Commerce Committee referred to Attorney General Janet Reno questions about a $1 million fee Mr. Knight received after lobbying federal officials to move the Federal Communications Commission headquarters to a building complex controlled by Tennessee developer Franklin Haney, a Gore family friend and Knight client. No charges were brought in either matter. In a separate prosecution, Mr. Haney was acquitted in July on 42 counts of making illegal contributions to Mr. Gore and other politicians.
Mr. Gore also raised eyebrows in May with the appointment of former Rep. Tony Coelho to run his presidential campaign. Among hardened political professionals, the move was taken as a sign that the Gore campaign will not overly trouble itself about the ethical quandaries of big-time money raising. In 1989, Mr. Coelho beat a hasty retreat from Congress as scandal clouds gathered around him. The immediate cause of his departure was an undisclosed financial relationship with financier Michael Milken. But Mr. Coelho by that time had become infamous as a pioneer of the hardball political shakedown, threatening business and political action committees for “donations” with the reminder that congressional Democrats were in a position to punish their enemies and reward their friends.
It was politics as blood sport, and Rep. Coelho pursued it with a vengeance. One friend that reaped the reward was the savings-and-loan industry. Mr. Coelho raised millions for the Democratic Party from S&L owners, including hosting parties aboard a Potomac yacht named the “High Spirits,” owned by Vernon Savings & Loan of Texas. He rewarded his S&L friends in 1987 by helping to gut a House reform package, prolonging a debacle that cost the taxpayers more than $200 billion.
Vernon’s owner eventually was convicted of looting the S&L, and Mr. Coelho was forced to reimburse the conservators for the use of the yacht. Does any of this matter to the 2000 presidential race and a possible Gore administration? In many respects, Al Gore and George W. Bush have similar histories as sons of prominent politicians. But unlike his putative presidential opponent, Mr. Gore has not relied on his father’s connections in cutting deals leading to great personal wealth. He has, however, toiled at the feet of not only Bill Clinton but Armand Hammer, another master of transient morality, and his taste in associates tends to raise doubts about his clean-cut persona. This of course is no disqualification from serving as president. The charitable voter would recall the words of that political sage Mr. Dooley: “Politics ain’t beanbag.”
