SECRETARY BABBITT IN THE HOT SEAT
October 30, 1997
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SEN. FRED THOMPSON, Chairman, Governmental Affairs Committee: In late 1993, three small four bands of Wisconsin, Chippewa Indians applied to have the Department of Interior take land in Hudson, Wisconsin, into trust, so that the Hudson bands could convert a failing dog track into a casino.
KWAME HOLMAN: Committee Chairman Fred Thompson was describing the focus of today's hearing. Hudson is located on Wisconsin's western border, just a half hour drive from Minneapolis-St. Paul. Nearly two years after the three nearby Chippewa Indian tribes asked the Interior Department to approve their casino application, the Department said no.
SEN. FRED THOMPSON: On July 14, 1995, the political appointees at Interior formally announced the rejection of the application.
KWAME HOLMAN: The committee's interest in this story involves a group of Indian tribes opposed to the new casino, tribes that already were operating casinos, including a lucrative one in Green Bay, and feared a new casino would hurt their business.
SEN. FRED THOMPSON: In early 1995 these opposition tribes hired Patrick O'Connor, a prominent lobbyist, as well as a former DNC treasurer.
KWAME HOLMAN: And soon after that the Interior Department ruled in favor of the opposition tribes. Those Indian tribes then contributed thousands of dollars to the Democratic Party.
SEN. FRED THOMPSON: During the next four months the DNC an the DSC--Democratic Senatorial Campaign Committee--collected over $50,000 from O'Connor's class. The tribes, who were on the winning side of the Interior decision, those same tribes contributed an additional $230,000 to the DNC and the DSCC during 1996.
KWAME HOLMAN: The three Chippewa tribes also had hired a prominent lobbyist, Paul Eckstein, to argue for their casino interests with Interior Secretary Bruce Babbitt. Eckstein has known Babbitt for 35 years. They were classmates at Harvard Law School, and Eckstein worked on several of Babbitt's political campaigns.
JACK COBB: Do you consider Sec. Babbitt a friend?
PAUL ECKSTEIN, Lobbyist: Yes.
KWAME HOLMAN: Under questioning from Republican Counsel Jack Cobb Eckstein described a meeting he had with Babbitt on July 14, 1995, the day the Chippewas' casino application was rejected.
PAUL ECKSTEIN: I went in and explained that we had just heard from Counselor Duffy that the decision was going to be issued that day, and it was going to be denial, and reminded him of the commitment that had been made to make a presentation to him with my clients. And his response was that Harold Ickes had directed him to issue the decision that day. At some point the secretary asked me, do you have any idea how much these Indians, Indians with gaming contracts, have given to Democrats? I said, I don't have the slightest idea. And he said half a million dollars.
JACK COBB: Is there any doubt in your mind that Secretary Babbitt told you that he had been directed by Mr. Ickes to issue the decision that day?
PAUL ECKSTEIN: None whatsoever.
KWAME HOLMAN: Chairman Thompson said his review of records obtained by the committee suggests then White House Deputy Chief of Staff Harold Ickes and several other prominent Democrats worked to block the casino application and made themselves available to the opposition's lobbyist, Patrick O'Connor.
SEN. FRED THOMPSON: Beginning in April of 1995 Mr. O'Connor left a number of phone messages at the White House for Loretta Avant, a White House staffer who worked for Harold Ickes and handled Indian issues. Following the advice of White House counsel that White House staffers should not speak to lawyers or lobbyists on Indian issues Avant had her assistants return to the O'Connor phone calls and tell him as such. Meanwhile, on Monday, April 24, 1995, during a presidential visit to Minneapolis, Mr. O'Connor saw President Clinton and told the President that he was representing Indian tribes opposed to the Hudson Casino project and complaining that Avant would not return his phone calls.
President Clinton called over Bruce Lindsey and asked him to follow up with Mr. O'Connor. Hours after the O'Connor discussion with President Clinton Lindsey telephoned Avant from Air Force One to check into the Hudson matter. Avant agreed to call O'Connor but only after cautioning Lindsey that White House counsel had advised her not to speak directly to lobbyists on Indian issues. Before calling O'Connor Avant also wrote a strongly-worded memo to her boss, Harold Ickes. As you can see in this memo, Avant described the Hudson issue as a hot potato too hot to touch. "The legal and political implications of our involvement would be disastrous," she said.
KWAME HOLMAN: Democrats on the committee insisted the decision to deny the Chippewas' casino application was based on the merits of the case and displayed the names of local elected officials all the way up to the governor, who were opposed to building another casino.
SEN. CARL LEVIN, (D) Michigan: There was very, very strong opposition from the governor, the attorney general, the leaders of the legislature, the local officials against this casino. Now, would that be a fair statement?
PAUL ECKSTEIN: There was strong opposition. It wasn't uniform.
KWAME HOLMAN: Once members finished their questioning Eckstein got up from the witness table and left the hearing room, making way for the second witness, Interior Secretary Bruce Babbitt.
SEN. FRED THOMPSON: Good afternoon, Mr. Secretary.
KWAME HOLMAN: Babbitt said he had no contact with Harold Ickes concerning the casino application but that their staffs had talked on three occasions. Babbitt also said the decision to deny the application was based strictly on the merits of the case.
BRUCE BABBITT, Secretary of the Interior: The department in this administration has adhered to a policy that off-reservation gaming will not be imposed on communities that do not want it. In this case the three Chippewa tribes requested that we acquire off-reservation land to open a casino located within the City of Hudson, which is 85 miles away from and outside the nearest of their three reservations.
KWAME HOLMAN: Babbitt acknowledged he mentioned Harold Ickes in his conversation with Paul Eckstein. He said he did so in an attempt to end the conversation.
SEC. BRUCE BABBITT: I don't recall exactly what was said, but, on reflection, I probably said that Mr. Ickes, the department's point of contact on many interior matters, wanted the department or expected the department to decide the matter promptly. If I said that, it was an awkward effort to terminate an uncomfortable meeting on a personally sympathetic note, but, as I have said here today, I had no such communication with Mr. Ickes or anyone else from the White House.
KWAME HOLMAN: And Babbitt denied making any comment to Eckstein about contributions made by Indian tribes.
SEN. FRED THOMPSON: Well, is it possible that you could have talked about contributions in that conversation--by the Indians?
SEC. BRUCE BABBITT: Well, I simply have no recollection of any conversation to that effect.
SEN. FRED THOMPSON: Are you stating under oath definitely that you did not have such a conversation?
SEC. BRUCE BABBITT: I am stating under oath that I have no recollection of any conversation of that kind.
KWAME HOLMAN: Chairman Thompson ultimately ended the line of questioning after openly expressing frustration with Babbitt's answers. The issue of potential political influence on the Indian casino decision, however, will continue to be scrutinized. The Justice Department last week said it had begun a preliminary investigation of the matter.