The Federal Bailout That Saved Mitt RomneyGovernment documents prove the candidate’s mythology is just that

Mitt Romney

Mitt Romney (Photo credit: Wikipedia)

 

Former Massachusetts Gov. Mitt Romney, a GOP p...

Former Massachusetts Gov. Mitt Romney, a GOP presidential hopeful, campaigns May 9 in Ames. (Photo credit: Wikipedia)

 

Romney

Romney (Photo credit: Talk Radio News Service)

 

AUGUST 29, 2012 7:00 AM ET

Mitt Romney likes to say he won’t “apologize” for his success in business. But what he never says is “thank you” – to the American people – for the federal bailout of Bain & Company that made so much of his outsize wealth possible.

According to the candidate’s mythology, Romney took leave of his duties at the private equity firm Bain Capital in 1990 and rode in on a white horse to lead a swift restructuring of Bain & Company, preventing the collapse of the consulting firm where his career began. When The Boston Globe reported on the rescue at the time of his Senate run against Ted Kennedy, campaign aides spun Romney as the wizard behind a “long-shot miracle,” bragging that he had “saved bank depositors all over the country $30 million when he saved Bain & Company.”

In fact, government documents on the bailout obtained by Rolling Stone show that the legend crafted by Romney is basically a lie. The federal records, obtained under the Freedom of Information Act, reveal that Romney’s initial rescue attempt at Bain & Company was actually a disaster – leaving the firm so financially strapped that it had “no value as a going concern.” Even worse, the federal bailout ultimately engineered by Romney screwed the FDIC – the bank insurance system backed by taxpayers – out of at least $10 million. And in an added insult, Romney rewarded top executives at Bain with hefty bonuses at the very moment that he was demanding his handout from the feds.

 

 

With his selection of Paul Ryan as his running mate, Romney has made fiscal stewardship the centerpiece of his campaign. A banner at MittRomney.com declared, “We have a moral responsibility not to spend more than we take in.” Romney also opposed the federal bailout for Detroit automakers, famously arguing that the industry should be forced into bankruptcy. Government bailouts, he insists, are “the wrong way to go.”

More: Romney Is Lying. Again.

But the FDIC documents on the Bain deal – which were heavily redacted by the firm prior to release – show that as a wealthy businessman, Romney was willing to go to extremes to secure a federal bailout to serve his own interests. He had a lot at stake, both financially and politically. Had Bain & Company collapsed, insiders say, it would have dealt a grave setback to Bain Capital, where Romney went on to build a personal fortune valued at as much as $250 million. It would also have short-circuited his political career before it began, tagging Romney as a failed businessman unable to rescue his own firm.

“None of us wanted to see Bain be the laughingstock of the business world,” recalls a longtime Romney lieutenant who asked not to be identified. “But Mitt’s reputation was on the line.”

Mitt Romney’s Federal Bailout: The Documents

The trouble began in 1984, when Bain & Company spun off Bain Capital to engage in leveraged buyouts and put Romney in charge of the new operation. To free up money to invest in the new business, founder Bill Bain and his partners cashed out much of their stock in the consulting firm – leaving it saddled with about $200 million in debt. (Romney, though not a founder, reportedly profited from the deal.) “People will tell you that Bill raped the place clean, was greedy, didn’t know when to stop,” a former Bain consultant later conceded. “Did they take too much out of the firm? You bet.”

The FDIC documents make clear what happened next: “Soon after the founders sold their equity,” analysts reported, “business began to drop off.” First came scandal: In the late 1980s, a Bain consultant became a key figure in an illegal stock manipulation scheme in London. The firm’s reputation took a hit, and it fired 10 percent of its consulting force. By the time the 1989 recession began, Bain & Company found itself going broke fast. Cash flows weren’t enough to service the debt imposed by the founders, and the firm could barely make payroll. In a panic, Bill Bain tapped Romney, his longtime protégé, to take the reins.

 

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“We don’t need someone to think” – Salon.com

Grover Norquist, conservative general, explains it all. (Credit: Jeff Malet)

On Friday evening, conservatives and Occupy forces talked trash outside the Conservative Political Action Committee conference (CPAC) in Washington, D.C. To my right stood two Occupy soldiers, Michael and Mo, both African-American, shouting slogans about the 1 percent. To my left, a cluster of jacket-and-tied CPAC men shouted sound bites about freedom  In between them stood a line of grim-looking, blue-suited officers of the Metropolitan Police Department, both white and African-American, quite possibly thinking, These people are nuts.

Both sides came equipped for a war of words. Michael is a young Iraq war vet from Alaska who once admired George W. Bush, and is now an Occupier par excellence. He offered the high-decibel insight that “The system has failed!” Standing next to him, Mo, a big guy and a regular at the now-evicted OccupyDC camp, shouted, “The 1 percent are using you guys.”

“The 1 percent?” a CPAC man volleyed back. “God bless ‘em. What’s wrong with making money?”

Another CPAC-er tossed this verbal firecracker: “Just because you’ve failed, doesn’t mean the system’s failed.”

That was rich, the Occupiers thought. Michael had done a tour of duty in Iraq — probably one more than the CPAC man had done. Mo was personally offended. “I haven’t failed,” he said, his face crinkling up at the insulting assumption. “I have a job.” He shook his head and turned away like: There’s no talking to these people. And the CPAC gang turned away, no doubt thinking: There’s no talking to these people.

The CPAC cluster hungrily took up the chant of “Steak! Steak! Steak!” Occupiers replied with a mocking chant of “White power! White power! White power!” And so the confrontation dissolved.

“Truth on our side”

via “We don’t need someone to think” – Salon.com.

“Good Newt, Bad Newt”

“Good Newt, Bad Newt”

by Peter J. Boyer
Vanity Fair July 1989

In a corner office in the U.S. Capitol, a short stroll down the marble corridor from the room where Speaker of the House Jim Wright is writhing in a stew of ethics charges, the man who’s put Wright in that fix seems quite out of sorts himself. “I’m a controversial guy,” Newt Gingrich says, with the air of a man who has discovered something surprising about himself. He isn’t sure he should make himself available for a magazine story, explaining, “I’m not up to speed on the national press.”

It is an amazing assertion, coming from the congressman who once declared he was “reshaping the entire nation through the news media,” who just a week earlier had been quoted in Newsweek as saying, “If you’re not in The Washington Post every day, you might as well not exist.” Gingrich, Congress’s own automated-teller machine of quotes, is not up to dealing with the press? Something is definitely wrong.

In fact, it has been a terrible week for the chunky, forty-five-year-old Republican congressman from Georgia, and this is only Thursday afternoon. On Tuesday, The New York Times gave prominent display on its op-ed page to an article written by one of Gingrich’s most bitter Democratic foes, Representative Bill Alexander of Arkansas, who branded Gingrich a neo-McCarthyite and urged his colleagues to take up the fight against him. Then Gingrich and his wife, Marianne, met with reporters to answer charges (filed by Alexander) of possible improprieties in an unusual book-promotion deal –improprieties loosely similar to those with which Gingrich has charged Speaker Wright. It was a difficult, testy news conference; the press couldn’t resist probing the obvious parallels, and after just a few moments Marianne Gingrich stalked out of the press gallery, sobbing. The event landed Newt and Marianne Gingrich on the front page of Wednesday’sWashington Post .

Thursday is going downhill fast. It began with a morning meeting with House Republican officials in the office of Bob Michel, the minority leader. Gingrich discovered that four Democratic congressmen were asking the House ethics committee to appoint an outside counsel to investigate the charges against him. The next item on his schedule was a National Press Club luncheon, at which he was to be the featured guest. Marianne Gingrich was supposed to attend as well, but she had been so upset that she refused to accompany her husband. Now, when he returns to his office following the lunch, she is on the phone, in tears; a friend from Ohio has called, asking about an account of the press conference in the Cleveland Plain Dealer .

“He is a little testy today,” says Sheila Ward, Gingrich’s faithful young press aide, who has just earned a wicked blast of Gingrich ire for turning up the sound on an office television (tuned, appropriately enough, to C-SPAN, the public-service cable network that covers government).

It was probably inevitable that Gingrich, himself an accomplished slinger would get splattered in Washington’s current mud bath. Not only is he the man who put Jim Wright, the top Democrat in the country, on the spit, but his decade-long career in the House of Representatives has been one sustained assault on the opposition party –known in the Gingrich lexicon as “the corrupt left-wing machine” that exists to perpetuate “the corrupt liberal welfare state.” Almost from the moment he arrived in town, Gingrich, who looks like Pete Rose (and, for that matter, plays Congress in the headfirst style in which Rose played baseball), has been practicing what he calls “confrontational activism,” a standard theme of which is the defeatist psychology of the Soviet-appeasing Chamberlains on the other side of the aisle.

But even this is not why Newt Gingrich stands at center stage in the political theater just now. To many in Washington, both those who admire and those who loathe the Georgia representative, Newt Gingrich is the future of American politics, arrived; a hope, or a nightmare, come true.

 

This spring, in an extraordinary jolt to the usually somnolent politics of House Republicans, Gingrich leapt from his niche as a back-bench bomb thrower to the post of minority whip, a key position in a party leadership. His ascension changes the chemistry of politics on Capitol Hill and signals a dramatic new Republican strategy. After thirty-four years as the minority party in Congress, years of deep frustration, the Republicans seem ready to launch an all-out war on Democratic dominance, attacking the Democratic Party as a whole with the same spectacularly successful (if ungentle) tactics that George Bush’s campaign managers used against Michael Dukakis in 1988.

The Bush campaign sank Dukakis by playing to the national gut –driving the public perception of the Democratic candidate to the far left with such devices as the Willie Horton ads, which portrayed Dukakis as being soft on crime by focusing on Massachusetts’s prison-furlough program. (Horton, a scary-looking black man, raped a white woman while on a weekend leave from a Massachusetts prison.) The architect of that campaign, political consultant Lee Atwater, is now chairman of the Republican National Committee, and his former boss, political consultant Ed Rollins, is head of the National Republican Congressional Committee. Atwater was among the first to applaud Newt Gingrich’s selection as whip: “He talks the kinda talk I like.” It is clear that the Atwater-Rollins wing of the party, at least, intends Gingrich to be the Republicans’ front man in the drive to do for all of the G.O.P. what Atwater did for George Bush–to “Willie Horton” the Democratic House of Representatives by hammering away at the theme of “institutional corruption.”

“I think Newt Gingrich has an opportunity to have a somewhat unprecedented role for a Republican House member,” Atwater says. “He can truly be a national political guru for our party. He can be a spokesman, he can be a philosopher, and he can be a strategist for our party. As Teddy Roosevelt once said about the bully pulpit, Newt Gingrich has an opportunity to be as big a man as he can be.”

Gingrich is eager for the role. By Saturday he has shaken off the setbacks of the news conference and the Democrats’ attacks–“a smear campaign by Jim Wright’s cronies”–and is pounding away once more at the “corrupt left-wing machine.” He spends most of the day at Atwater’s home, plotting strategy. His goal: a Republican majority by 1992. (“And the great thing about Gingrich,” says Atwater, “is that he really believes it.”) That evening, after attending the White House correspondents dinner, Gingrich makes an appearance on a public-television talk show, where he says that God has given him a mission: “To find honest self-government and to survive as a free people.”

It will be hard for the Democrats to campaign against that.

Not surprisingly, Gingrich has often been diminished by his colleagues in the House as a fast-talking demagogue, or worse. Beryl Anthony Jr. of Arkansas,the head of the Democratic Congressional Campaign Committee says simply, “He’s crazy.” In 1985, The Washington Postwrote that “Newt Gingrich may be just about the most disliked member of Congress.”

 

Why, then, would Republicans choose him as a leader? Because he is a rare and compelling politician.

In public meetings and speeches, Gingrich is an extremely engaging fellow. His defense of his book deal before the National Press Club (no pit bulls, but not exactly the Young Republicans, either) prompted thunderous applause. He takes complete possession of the room, even when he’s speaking what one critic calls “GobbledyNewt”–his philosophical mix of futurism, high technology, free enterprise, and space. A former college professor, he has the instructor’s command, rather than the lawyer’s equivocation, a compelling directness in a world of frayed smiles and glazed expressions. But most of all Gingrich has something that is of great practical value to the Republican just now –the zealot’s single-minded drive.

It is grounded in a childhood that was divided and rootless. He was born Newton Leroy McPherson near Harrisburg, Pennsylvania, in 1943, his parents’ only child. His father was in the navy, but his parents broke up after the war, and his mother married a career army officer, who adopted Newt when the youngster was five. Both of Gingrich’s parents had children in their second marriages, and although Newt was an army brat, following his mother and stepfather from base to base, he stayed in touch with his natural father.

Then, as a fifteen-year-old high school student in France, where his stepfather was stationed, Gingrich was “called” to politics.

“I got active in this business of politics and self-government in 1958, when my father, who was serving in the U.S. Army, took us to the battlefield of Verdun.” The boy stared at the bone pile left by the great battle, and “over the course of the weekend, it convinced me that civilizations live and die by, and that the ultimate margin in a free society of our fate is provided more by, elected political leadership than by any other group. That in the end it’s the elected politicians that decide where we fight and when we fight and what the terms of engagement are, and what weapons systems are available.” That awakening, he says, led to a 180-page term paper on the balance of world power. When he turned in the paper, he informed his teacher that his family was being transferred to Fort Benning, Georgia, where he would become a Republican congressman.

It is a story that Gingrich tells at least three or four times a week. It is his self-explanation, his Genesis. It is possibly even true. Who would make up a story like that?

In any case, Newt Gingrich was a driven lad by the time he arrived at Baxter High School, and politics was his passion –as a junior, he passed out campaign literature for Nixon’s 1960 campaign. His singular determination was perhaps best seen in his first successful romance, a schoolboy crush he developed on his high-school math teacher. Lots of boys get romantic notions about pretty young teachers, but Newt Gingrich didn’t let go of his. After graduation, when she moved to Atlanta, he went to Atlanta too, enrolling at Emory University. Gingrich pursued his former math teacher, seven years his senior, until Jackie agreed to become his wife. They were married at the end of his freshman year, and soon they had their first child, Kathy. Gingrich then entered that hazy passage through ambiguity experienced by the majority of young American men during the 1960s. Like most of his generation, Gingrich was moderately anti-Establishment (he tried pot, and participated in a campus protest at Tulane University) and chose not to go to Vietnam, opting for deferments available to him as a father and a student. But unlike most young men his age, Gingrich would be haunted by his decision. Later, when, as a hawkish congressman, he would lash out against the “weak-on-defense left” and espouse universal military training, his opponents would investigate Gingrich’s own military background.

Sure enough, he found himself listed among a sizable group of noted conservative hawks (including George Will and Richard Perle) who had managed to avoid the war-the “war wimps,” as they came to be called. In 1985, he told Jane Mayer of The Wall Street Journal that he still believed that “Vietnam was the right battlefield at the right time.” Why didn’t he go? “Given everything I believe in, a large part of me thinks I should have gone over,” he allowed. But, recovering, he added, “Part of the question I had to ask myself was what difference I would have made.”

After graduating from Emory, he and Jackie and Kathy moved to New Orleans, where the Gingriches had a second daughter, and Newt worked on his graduate degrees in history. He ultimately earned his Ph.D. from Tulane, but maintained his vivid interest in politics throughout. He took a year off in 1964 to manage a congressional campaign in Georgia and worked on Nelson Rockefeller’s presidential quest in 1968. In 1970, Gingrich moved his family to Carrollton, a quiet town south of Atlanta, where he took a job teaching environmental studies.

One of the things Gingrich liked about the job was its location-in Georgia’s Sixth Congressional District, which Gingrich soon identified as the seat of his boyhood visions. The seat, which had been solidly Democratic since Reconstruction, was held by a longtime incumbent, Jack Flynt. Gingrich’s first two campaigns, both against Flynt, were unsuccessful, but it was a measure of his political acumen that the races were even close. In 1974 he was hurt by Watergate and Gerald Ford’s pardon of Richard Nixon-a political act that he later termed “just unbelievably dumb. Gerald Ford personally cost me a Congressional seat…Just utterly stupid.” And in 1976 he was hurt by the presence at the top of the Democratic ticket of a native Georgian, Jimmy Carter.

But Jack Flynt retired after his 1976 term, and 1978 was Gingrich’s year. His Democratic opponent was Virginia Shapard, a state senator. The campaign was so rough that Shapard is still more than a little bitter about it. “It was, early on, that same sort of technique that you saw in this last campaign at the presidential level,” she says, “the Willie Horton type of thing.” Gingrich, seeking to drive Shapard to the left and carve out the middle and right for himself, campaigned as a hard, no-tax, anti-welfare conservative. One Gingrich ad, which Shapard says was particularly effective, showed hands reaching out and grabbing at a pile of dollar bills-taxpayer dollars-“and this voice-over said, ‘Virginia Shapard says she’s against welfare fraud, but she voted against…’ and then they cited the bill number, and it was absolutely devastating.”

Another Gingrich theme in that campaign was moral leadership and family values. He drove the point home with an ad claiming that if Shapard were elected to Congress she would leave her husband, a local businessman, behind, while Gingrich would keep his family together. This issue was a subject of particular irony among the Shapard campaign staffers, where gossip about Gingrich’s roving eye was widely believed and it was assumed that the Gingrich marriage was on the verge of breaking up. “As the days dwindled down in the end of the campaign,” Shapard says, “the campaign workers had an unofficial pool going on to see how long it would take him when he got to Washington to dump [Jackie.]“

 

Not long, as it turned out. Jackie Gingrich went to Washington with her newly elected husband, but she did not return for his second term. She says that Gingrich walked out on her in the spring of 1980. That fall, while she was in the hospital recovering from surgery for uterine cancer, he appeared at her bedside with a yellow legal pad outlining the details for their divorce. The next year, he married his current wife, Marianne Ginther, a small-town Ohio woman fifteen years younger than Jackie, who was then a personnel clerk with the Secret Service.

“I was very fond of Jackie, and I felt sorry for the whole way that it turned out for her,” Shapard says. “But…you could have written that down before it happened, and many people did.”

It’s hard now for Jackie Gingrich to talk about her life with Newt. Her daughters are grown, and though she talks with them regularly by phone, Jackie lives alone in Carrollton, still teaching, and tutoring at night. She no longer has any contact with Gingrich whom she refers to as “the congressman.” “I do not talk to him, he does not talk to me, and I do not even get junk mail from the office.”

In Washington, the second Mrs. Gingrich bristles at the suggestion that she was just the new model that Gingrich traded in for when it became convenient . “He’s a public figure and people will attack him,” Marianne says. “He’s just got to take it and keep moving.”

In fact, she adds, she and Gingrich spent long hours discussing his troubled previous marriage, which was years in the undoing. “I’ve seen bills where they both went to marriage counseling before they split up, before she got ill. The documentation is there.”

“When you’re the second wife and you’re trying to uphold what you did or who you are, you’ll say those things” is Jackie’s only comment.

Asked about his divorce by The Atlanta Constitution , Newt Gingrich said, “Even if I had been sensitive, it would’ve been a mess.”

It is not easy to become the most disliked man in Congress in the space of three terms, but Newt Gingrich was no ordinary congressman. Even before he got to Capitol Hill, when he was making his first run in 1974, he said, “I intend to go up there and kick the system over, not try to change it.” It was not your usual sort of campaign promise, but then, Gingrich did not keep his word on it. When he arrived in Washington, he ignored the traditional course for freshmen congressmen of quietly taking backseat and doing party and committee grunt work while learning the ropes. Instead, he openly cultivated the press and, of course, he developed his romance with C-SPAN.

Nothing was so sweet a piece of happenstance as the arrival of Gingrich and C-SPAN in the House of Representatives at the same moment. They were made for each other. A Washington newsman, Brian Lamb, had had the idea of bringing the proceedings of both houses of Congress to American television viewers as a nonprofit public service. Congressional leaders, accustomed to the clubby seclusion of Congress and frankly skeptical about the television appeal of their work, were doubtful –particularly since Lamb wanted gavel-to-gavel coverage –but House Speaker Tip O’Neill eventually gave the go-ahead.

Gingrich, the new face, quickly recognized an opportunity. The House, which limits the length of debate over legislation, has a rule allowing so-called special orders –permission to give lengthy speeches at the end of each legislative day. These have long been a means by which congressman could read into the Congressional Record various matters of importance to their constituents, usually matters of trivia. But Gingrich, concerned less with the Record than with the potential television audience, began to use special orders regularly as his platform for advancing ideas and, especially, for attacking the Democratic majority.

At first, his approach gave the impression that he was a brave young crusader, taking on the opposition in heated floor encounters, but, in truth, most of his diatribes were delivered before a virtually empty House. When, in 1984, he escalated his attack on Democrats to the point of questioning their patriotism– accusing them of being “blind to Communism” –Speaker O’Neill lost his cool. In a legendary head-to-head encounter on the floor of the House, the Speaker blasted Gingrich : “You deliberately stood in that well before an empty House, and challenged these people, and challenged their patriotism, and it is the lowest thing that I’ve ever seen in my thirty-two years in Congress.”

The end of the story, however, was a Gingrich coup: Trent Lott, who was then minority whip, protested O’Neill’s attack on Gingrich as being out of order, and O’Neill’s remarks were stricken from the record. It was the first such rebuke of a Speaker of the House since 1798. Gingrich was famous.

Gingrich gradually developed a political manifesto, a sort of New Age Reaganism, and called his blueprint for a new America the “Conservative Opportunity Society” (as opposed, of course, to the Liberal Welfare State.) By 19(86?), although he held no committee chair or leadership position, Newt Gingrich was named by The Almanac of American Politics as one of the twenty-six most influential members of the House.

His recognition and his gathering power were not the result of the legislation he drafted or helped to pass, which, in fact, was negligible. And he was scorned by detractors for some of his wackier notions –which ranged from the off-the-wall (plans for statehood in outer space) to potential political dynamite (he once proposed abolishing Social Security and replacing it with mandatory I.R.A.’s).

Still, Gingrich’s accessibility, and his willingness (and ability) to glibly hold forth on his various notions at a moment’s notice, gave him a reputation as a brainiac, a kind of walking lecture, and won him some fans within the more activist branch of the Republican Party. Guy Vander Jagt of Michigan, for one, is as impressed with Gingrich as ever. “In terms of the sweep of intellect and the energy to drive those intellectual conceptualizations, he has no equal.”

For Gingrich, politics is his profession, his sport, and his hobby, and his private life is pretty dull. He and Marianne have never been regulars on the party circuit, they have no children, and they have no pets –because Newt is partial to reptiles. (They bought a boa constrictor at one point, which Newt then donated to the zoo; he wanted to keep it, but Marianne knew they wouldn’t be able to find neighbors willing to boa-sit when the Gingriches were out of town.) Marianne says she has only one friend in Washington, and much prefers her life back in Georgia: “I find Washington an extremely cynical, transitional, unstable place –it’s not an easy place.”

But Newt thrived in the bright light of the recognition he was receiving, to the point, some would suggest, where his ego became a trifle overfed. Even for a town not populated by self-effacing people, Gingrich has said some pretty memorable things, such as his observation to The Atlantic that his attendance at a National Press Club dinner “made no sense except that the news media could see me walking through the crowds.” Still high from his success at the ’84 convention, when he managed to persuade Reagan’s speech writers to include the term “opportunity society” in the president’s address, he told The Washington Post , “I have an enormous personal ambition. I want to shift the entire planet. And I’m doing it. Ronald Reagan just used the term “opportunity society” and that didn’t exist four years ago. I just had breakfast with Darman and Stockman because I’m unavoidable. I represent real power.”

He was already a favorite target of the Democrats, and such pronouncements made him even easier prey. “Newt Gingrich can unify the Democratic Party better than anyone in America,” says Democratic whip Tony Coelho of his longtime opponent. In 1985, some Democratic staff members assembled a collection of Gingrich’s quota, and distributed it under the title Talking Heads-A Newt Gingrich Chrestomathy . In May, a sequel (Son of Talking Heads) was produced, and included this Gingrich gem: “Vision must lead to words. Our vision cannot exist if we cannot say it. Strategy must lead to policies, to strategies, and they must lead to structures for implementation. Operations must be definable tasks for which we can hold people accountable. The tactics on a daily basis must be a doctrine that fits our vision of strategy.”

The passage was headlined: “Newt Sun T’Zu.”

Gingrich had taken on Democrats almost from the moment he hit town, but in May 1988 he went after the big fish: the Speaker of the House. After spending months preparing his case against Wright, he filed charges of ethics violations with the House Committee on Standards of Official conduct.

It was a lonely course; while some Republicans privately cheered Gingrich’s move, none would join him in those first months as he fought to bring his complaint. The Speaker of the House –any Speaker– is a force not to be trifled with, and Wright was held to be particularly vindictive. Also, many Republicans were (and are) unsure about the propriety of making ethics a partisan issue; beyond that, there is the “glass house” syndrome in Congress, a work unto itself where ethically questionable behavior is sometimes explicitly within the rules. But Gingrich was determined. It was, politically, the perfect moment to attack Wright; the protracted Ed Meese scandal promised to give Democrats the sleaze issue for their convention, and Gingrich’s assault blunted that.

 

So he whaled away at Wright, calling him “the most corrupt Speaker of the twentieth century,” and was vindicated, to a degree, when the committee issued its report this April. Essentially, it charged Wright with sixty-nine potential violations. The Speaker, asked at the time about his feelings for Gingrich, said they were like those “of a fire hydrant for a dog.”

The Wright triumph proved to be a clear asset to Gingrich in his campaign for party whip, but, ironically, the position had become vacant only because of a Republican ethics mess –the John Tower affair. When Tower was rejected by the Senate in March, President Bush nominated Dick Cheney of Wyoming, who had just been elected minority whip, for secretary of defense. Gingrich was in his field office in Griffin, Georgia, when he heard the news about Cheney’s nomination from a USA Today reporter. He made up his mind instantly.

“It was 3:45 in the afternoon,” he says. “I decided by the time I hung up. It was so obvious that, having lost Lott [Trent Lott of Mississippi, who'd been elected to the Senate] and Kemp [who'd moved into Bush's Cabinet] and Cheney, we needed somebody with a good deal of drive and energy to fill the vacuum that those three guys left behind them. And so I decided to try it.”

It may have seemed obvious to Gingrich, but not to others. The whip’s job (the title does in fact derive from a literal use of the word: the “whipper-in” at a fox hunt is a man who keeps the hounds together in a pack) is the ultimate inside party position, involving the counting of noses, the corralling and delivering of votes, the building of coalitions. Gingrich was the quintessential party outsider, a freelancer with no known expertise in vote gathering, several well-known antagonisms within his own party and, of course, with Democrats, and he was no ally of minority leader Bob Michel’s. Michel, in fact, was supporting his fellow Illinoisan Edward R. Madigan, who had the traditional qualifications for the role to a T. But Gingrich once again was prepared to seize his moment.

He had heard about the Cheney appointment on a Saturday, and immediately got on the telephone, rounding up support for his candidacy. He called Marianne into his office to get food and run errands, while he and his allies worked the phones late into the night. By Monday, he’d built a sizable base of support. Madigan didn’t get around to announcing until Monday. Gingrich won the election by two votes, 87 to 85, put over top by some of his longtime moderate adversaries in the party. After Gingrich’s victory, Wright sent him a copy of his bookReflections of a Public Man , with the inscription, “For Newt –who likes books, too…To be chosen by your peers is a great honor.” Gingrich called the Speaker and thanked him –but had second thoughts when it occurred to him that Wright’s gesture “was meant as a publicity stunt.”

The vote made clear, Michel said, that the G.O.P. members wanted a more activist leadership. As Gingrich sees it, “The party went through a twelve-day introspection trying to decide which was the greater risk, and decided on balance it was less risky to have more risks.”

Some, including Gingrich himself, believe that his new party “insider” status will moderate the former bomb thrower, “I have to be more cautious now,” he says, “because I no longer just speak for myself.” Coelho says that in the early going he has been cooperative, helping to pass the budget through the House without obstruction.

But there are also those in the G.O.P. who say that Gingrich is biding his time, that it is one thing to be conciliatory on the budget, and that when it comes to real “wedge” issues, those gut issues that can be used against Democrats committed to policies outside the moderate-conservative spectrum, the Gingrich strategy will be to raise hell and publicize the divisions.

“You’ll see them more energized, more involved in drawing the line to show the difference between Republican and Democratic behavior,” Vander Jagt says, “and therefore you’ll see more sharply defined confrontational votes that we can play to. One of my frustrations has been you do not change public perception by issuing press releases from the Republican National Committee. You change it by headlines that result from action under that Capitol dome and votes that are taken there.”

But far more important than Gingrich’s congressional role is his place in the wider campaign to win the House for the Republican Party. There is in this Republican quest a weird factor at play. Polls cited by both parties show that about half of all Americans don’t perceive the House as an institution run by Democrats. When Reagan was in the White House, in fact, more people thought that it was a Republican body. Republican strategists believe, perhaps inevitably, that if voters saw the House as a Democratic monolith, they’d make the same values connection they make in presidential races and take it out on their local Democrats. That’s what G.O.P. strategists believe occurred in 1980, when, with Jimmy Carter in the White House, people took for granted that the House was democratic and proceeded to go out and vote for Republican congressional candidates.

So Gingrich’s role is to drive home the message that the House is a Democratically controlled institution. Or, rather, that it is a “corrupt, left-wing, Democratically controlled institution.”

“Exactly,” Vander Jagt says, “exactly. We don’t have Jimmy Carter to help us anymore. Now we’ve got Newt Gingrich.”

Democrats, naturally, consider that underlying premise –that Americans will vote Republican if they realize the House is Democratic-to be, in the words of Representative Anthony, “poppycock.” Still, they do worry about losing seats when congressional districts are reapportioned before the 1992 election. (As many as twenty seats will shift to the West and South, growing Republican strongholds.) And a Gingrich-led campaign to Willie Horton the Democratic Party figures to hurt individual candidates in the South, where many Democratic congressmen already have to out-conservative the Republicans to win elections.

All of this, of course, makes Newt Gingrich a more tempting target for Democrats than ever before, which is why Alexander’s ethics complaint against the Georgian should have surprised no one.

Democrats considered it the height of hypocrisy for Gingrich to go after Wright for his peculiar book deal when Gingrich himself had made not one but two unusual book arrangements. The first was in 1977, before he actually won his seat, when he accepted $13,000 from his supporters to write a book that he never completed. The second case, involving Gingrich’s 1984 manifesto for the Conservative Opportunity Society, concerned a unique arrangement by which twenty-one “investors” paid $5,000 each to a limited partnership, run by Mrs. Gingrich, to raise money to promote the book.

Gingrich stoutly maintains that his deal is “fundamentally different” from Wright’s because the money given for his book by each partner was “an investment, not a gift” –so defined by Gingrich because each partner had a chance to reap a profit if the book became a best-seller. (It didn’t.) However, Gingrich’s wife didn’t recruit just businessmen in forming the partnership, she recruited supporters of Gingrich’s, many of them constituents, and at least fifteen of the people who have contributed to his political campaigns. Some of them have said that they had no intention of making money, they just wanted to do something for Gingrich.

Gingrich has taken the assault hard, and was reportedly shaken to the point of tears when he heard that four Democratic colleagues were asking that a special outside counsel pursue the charges. He says he was “surprised and hurt,” and spent long, anguished hours wondering if he had in fact done something worthy of investigation.

But Newt Gingrich didn’t get this far by indulging in self-doubt. The next day the bomb thrower was back on the attack, accusing the Democrats of “an amateur smear,” and bullying the press for refusing to blithely accept his definition of an “investment” (House rules prohibit gifts from individuals in excess of $1,000). He played the annoyed college instructor, hectoring and ridiculing reporters. When he told Andrea Mitchell of NBC News that she was “overreaching” with a question, she expressed the sentiment of many in the room by snapping back, “It’s an environment you helped to create.”

It’s an environment that figures to get muddier. Newt Gingrich has touched off a scandal of truly historic proportion. The various investigations of Wright’s personal and business conduct range far beyond Gingrich’s original charges, and the ethics committee is now probing allegations of wrongdoing related to Wright’s unusual good fortune in an oil well deal (his blind trust turned a nifty $292,000 profit in a month). As the revelations continue, congressional and media scrutiny of the Speaker has intensified.

The Washington Post published a devastating retelling of a brutal stabbing by the man who was Wright’s top aide on Capitol Hill. Though the story had been common knowledge in congressional circles, the article was the talk of Washington for several days and resulted in the aide’s resignation. It gave vivid, spine-chilling details of John Paul Mack’s 1973 assault on a twenty-year old customer of the Virginia store in which he was then working as a clerk. He went berserk, slashing the woman and crushing her skull with a hammer, then left her for dead. After two years in jail, Mack was released on a work program; he had been promised a job in the office of Congressman Jim Wright –whose daughter was then married to Mack’s brother.

The sordid allegations and news stories multiply, and it has become clear to members on both sides of the aisle that Wright is unlikely to survive as Speaker of the House. At best, he’ll be allowed to resign his post and retain some shred of dignity. Furthermore, one of the likely choices to succeed him, Tony Coelho, may himself be facing an ethics-committee inquiry for failing to make required disclosures about his highly profitable purchase of a Drexel junk bond.

The bottom line is that Gingrich has delivered a crushing blow to the Democratic Party, and he’s prepared to escalate the battle if necessary. “There are at least nine cases of documented Democratic scandals that by their standard would require independent counsel,” he notes, then goes on to make what sounds very much like a threat. For the Democrats to press the case against him, Newt Gingrich warns, would be “an act of self-immolation that is irrational.”

Both Republicans and Democrats agree that this highly partisan ethics war has already inflicted heavy damage. But in the brave new political world personified by Newt Gingrich, a world in which confrontation is an end as well as a means, the bloodletting almost certainly won’t stop here.