DNC Chair A Troubling Pick






January 1, 2001



Washington money man Terry McAuliffe, who has never held public office or headed a party organization, is gliding toward the national Democratic chairmanship thanks to Bill and Hillary Clinton. That raises misgivings among the party's state leaders, but for the wrong reasons.


They all grumble about being left out of the selection process, and some are uncomfortable with President Clinton still exercising power. African-American leaders are publicly opposing McAuliffe with the long-shot candidacy of former Atlanta Mayor Maynard Jackson, also complaining that they were not consulted. The same grievance is raised by the Teamsters Union.


But I find no prominent Democrat who appreciates the party's vulnerability with McAuliffe in corruption cases, virtually dormant in the Clinton administration's Justice and Labor departments, that may be reopened under Republican management. Democrats avoid the broader issue of whether their new leader symbolizes big-money corruption.


Current newspaper accounts never list the prospective national chairman's occupation, calling him a "prodigious fund-raiser" and Clinton "golfing buddy." Actually, he is a prototypical Washington deal-maker who made a fortune in real estate and finance. His only political skill is the ability to raise vast sums of money, and that has endeared him to the Clintons.


Indeed, the president wanted to make McAuliffe the Democratic national chairman after the 1996 election, but it was considered inauspicious then to spotlight the author of money-raising White House coffees and Lincoln bedroom sleepovers. Four years later, the lame-duck president—and the senator-elect of New York--determined that the coast was now clear.


Joe Andrew, who proved a doughty warrior as chairman of the Democratic National Committee the last two years following a successful hitch running the Indiana state party, wanted another term. He seemed a good bet for a DNC majority with support from state chairmen as well as Vice President Al Gore. But the word was quickly passed that the Clintons emphasizing the "s"--wanted McAuliffe. President John Sweeney quietly and effectively mobilized the AFL-CIO behind his close ally McAuliffe.


Andrew, the quintessential party loyalist, deferred to the Clintons and endorsed McAuliffe. In a conference call with party operatives, Sen. Joe Lieberman (D-Conn.) and Andrew told how they had come to an agreement with Gore that Terry McAuliffe was the man. Nobody believed it, but nobody expressed their disbelief.


Teamsters President James Hoffa was furious. In a conference call with other union leaders, he told Sweeney that McAuliffe is unacceptable to the Teamsters. Hoffa deeply resents being cut out of Sweeney's back-channel mobilization of labor behind McAuliffe.


What really worries Teamster leaders is that McAuliffe at the DNC will generate more bad publicity for their long-troubled union. Federal prosecutors in court papers allege that McAuliffe was an active player in the 1996 campaign money swap between the Democratic Party and Teamsters, which defeated Hoffa in the election that was later voided. A Republican Justice Department might resuscitate this case to go after AFL-CIO Secretary-Treasurer Richard Trumka--and McAuliffe.


McAuliffe also is at the center of a civil suit filed by the Labor Department on May 5, 1999, charging that a labor union pension fund was fleeced in making a $6 million loan that all parties knew could not be repaid. McAuliffe was a trustee of the fund and co-owner of the development company getting the loan. He also owned a company that the suit alleges improperly sold a $2.5 million share to the pension fund, which then sold it as a loss to another


McAuliffe company.


The Labor Department has moved with glacial speed. After 20 months, discovery has been concluded with no court date set and department bureaucratskeeping their lips sealed. Could Republicans at the Labor Department get serious about this case?

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