AMY GOODMAN: Some of the other headlines today: President Clinton’s business partner in the ill-fated Whitewater venture came under close scrutiny yesterday in a trial that could damage Clinton’s reelection bid. Government prosecutor Ray Jahn called his first witness to back up claims that James McDougal, the real estate developer, was guilty of conspiracy and fraud in financing his ambitious projects in Arkansas in the mid-1980s. McDougal and his former wife Susan, also on trial, were partners of Bill and Hillary Rodham Clinton in the failed Whitewater venture.

What is Whitewater anyway? Karen Friedman of the Oh Sooo Politically Correct Players calls it “Whatwater.” And I know when most people hear about it, their eyes begin to glaze over. But there’s one investigative journalist who has been talking about and investigating a part of Whitewater that few people have heard about and I doubt will make your eyes glaze over. He is Ken Silverstein, co-editor of CounterPunch, described by The Village Voice as the nation’s leading political newsletter, which outshines all its competitors. He’s also author of a forthcoming book with Alexander Cockburn called Washington Babylon.

Ken Silverstein, welcome to Democracy Now!

KEN SILVERSTEIN: Thanks.

AMY GOODMAN: Well, why don’t you tell us your take on Whitewater and why you think it’s significant?

KEN SILVERSTEIN: Well, Whitewater is, as you indicated, an extremely confusing topic, and a lot of people do just sort of see the headline in the newspaper and go right by it. But at its origins, it’s a very simple case of pretty gross influence peddling.

Back in 1978, Bill Clinton was attorney general of Arkansas, and he was preparing to run for the governorship. And in that year, he and Hillary, his wife, and Jim and Susan McDougal, the infamous owners of the Madison S&L, bought 230 acres of riverfront property in the Ozarks. And the title to the land was put in the Clintons’ name, but they didn’t put any money down. The McDougals actually had fronted the money for the down payment on the loan.

Now, what’s curious about this is that the land — the land’s previous owner of record was a partnership called 101 River Development, but this was strictly a cutout arrangement. 101 had been set up a few days prior to the sale of the land to the Clintons, and a few weeks after the sale, 101 went out of business. It was a three-week-long partnership. The actual seller of the land was International Paper, one of the biggest timber companies in America. It’s a $16 billion-a-year firm, and they own 700 — or, 7 million acres of land in the U.S., and 800,000 acres in Arkansas. The timber industry is extremely powerful in Arkansas. We hear all the time about the poultry industry, Tyson, Don Tyson, etc., and, of course, the Walmart empire. However, timber is one of the more powerful players in Arkansas. International Paper, Weyerhaeuser, Georgia-Pacific, these three companies own two-and-a-half million acres of land in Arkansas, and they run 30 mills.

So, getting back to the sale, International Paper sets up this dummy corporation. They sell the land to the Clintons. He’s a powerful political figure, preparing to run for the governorship.

AMY GOODMAN: At the time, what, he’s attorney general of Arkansas?

KEN SILVERSTEIN: He’s attorney general, but he’s already running for governor, his first campaign. Now, International Paper, for some reason, decided to sell the land to the Clintons extremely cheap. At the time, back in the late '70s, non-riverfront property in the same area of the Ozarks was selling for about $1,000 an acre. Well, for some reason, International Paper decided to sell the land to the Clintons and the McDougals for $500 an acre, and that was riverfront property. So we're talking about a discount of probably somewhere on the order of 75%. So, this is the actual origin of Whitewater. This is the land, which came to — which was where the Whitewater Estates were going to be built. So, this is the origin of the whole Whitewater scandal, is simply this land transaction.

AMY GOODMAN: I haven’t read about this anywhere, this connection between International Paper and, at that time, attorney general, running for governor, Bill Clinton. Now, why is International Paper, at this time — at that time, interested in Bill Clinton?

KEN SILVERSTEIN: Well, this is a good question. Why didn’t International Paper call Ken Silverstein and say, “Ken, would you like to buy this riverfront land for $500 an acre?” Well, this is what we see in American politics so often, is that big corporations, through their campaign donations and through favors like this, are able to win access and influence with powerful figures. Bill Clinton was attorney general at the time. He had very important responsibilities in terms of enforcing environmental law. He was running for governor. He was the favorite to win the race for governor. I’d say that it’s pretty clear that International Paper was seeking to win influence and favor with someone they thought could do them favors sometime down the road. And, in fact, International Paper’s thinking on this matter turned out to be very true, because Bill Clinton did, in fact, go on to win the 1980 election for the governor of Arkansas.

AMY GOODMAN: In fact, when he was campaigning, didn’t he attack the records of the previous governors and really run on an environmental platform and make environmental promises and pledges?

KEN SILVERSTEIN: Oh, yeah, he was going to really take on the big industries of the state, including the timber industries. The timber lords of Arkansas had been clear-cutting huge patches of forest during the previous years, and Clinton had said he was going to come in and he was going to crack down on the timber industry. And there were all sorts of promises. It wasn’t just the timber industry. It was the poultry industry and everybody else who had been polluting the state.

AMY GOODMAN: We’re talking to Ken Silverstein, who is an investigative journalist and puts out CounterPunch, tells the facts and names the names. It’s a newsletter that comes out twice monthly, and it’s a newsletter not to be missed. So, why is it that the corporate papers are missing this story? I mean, there certainly are enough headlines on Whitewater.

KEN SILVERSTEIN: Well, I think there are a lot of stories on Whitewater. I am a frequent critic of the corporate press. In this case, I’m not sure it’s the usual reasons, which are often laziness or simply — often we do stories in the newsletter that, to us, look extremely ugly and look like there are terrible conflicts of interest; to the mainstream press, especially the Beltway press, it looks like business as usual. I mean, this is the way the city runs, and so they don’t see anything wrong about it, so they don’t even bother to look into it. That’s possibly partly the case here, too. This is not illegal behavior. International Paper, of course, can sell the land to the Clintons for $10. I mean, that would look even uglier, I suppose, but they’re free to do it. It does, however — if you’re a journalist, I would think you would want to look into what companies are giving money to candidates and what companies are, in this case, selling them land dirt cheap.

AMY GOODMAN: Tell us about the panel, after Bill Clinton became governor, that was set up, that he had promised that he would set up, deal with environmental issues.

KEN SILVERSTEIN: Well, this is the key thing, of course, is that it’s not just that International Paper sold the land cheap. It’s that they got some very nice favors from Clinton later.

On the campaign trail, Clinton had said he was going to set up a panel on clear-cutting and that they were going to take some very tough action. And environmentalists were all excited about the new governor. They were anxiously awaiting his actions. He comes in, and, as we saw when Clinton won the presidency, the fiery campaign — the fiery campaign promises soon gave way to very different policies once he was in office.

So, he comes in, and he does, in fact, set up a panel on clear-cutting. And he does, in fact, put a certain number of conservationists on it. However, the timber companies got extremely perturbed by this. They were very upset. They lodged their protest with the governor’s office, and Clinton, frightened, cowardly, as always, quickly boots the conservationists. He throws them off the panel, and he stocks the panel with industry hacks. Not surprisingly, this panel then comes out with recommendations that rules and regulations are scarcely beneficial to anybody. What we really want are suggestions and voluntary compliance from the companies. That would be a far more effective means of dealing with the situation.

So, this is how Clinton fulfilled his campaign promises, the win-win solution that he’s now become famous for. Now, he did lose office in '82, and he went into a two-year period of exile, but he had learned his lesson by then. He had decided, when he came back into office, or actually on the campaign trail in ’84, that — or, in ’82, I'm sorry, that he was not going to take on the powerful interests again. And he came back in. He got a lot of money for the campaign from International Paper, Tysons, all the other big corporations. And at that point, there was nothing that he was going to do to challenge the big corporations of the state. Now, he comes in, and in ’85 he signs into law a new tax break, a corporate tax break, that, of course, all the big corporations of the state took big advantage of. And to offset this loss, he implements a new sales tax on the citizenry. And, of course, the sales tax is the most regressive sort of tax there is.

AMY GOODMAN: Now, one thing that you just overlooked in this little story were those two years where he was voted out of office. And we see this, of course, with a lot of congressmembers in Washington. When they are voted out of office, you think they’re serving the public interest, maybe they’d go head up some nonprofit. But they end up being a lobbyist or representing some of the large corporations that they’ve been legislating around in Congress. What did Bill Clinton do during those two years that he lost the governor?

KEN SILVERSTEIN: Yes, when Bill Clinton lost the governorship, it was a period of deep reflection, apparently. He went to work at a Little Rock law firm called Wright, Lindsey & Jennings. This was the period when Hillary was, of course, at the Rose Law Firm. And he represented, during this period, the timber giants of Arkansas before state regulatory bodies, such as the Pollution Control Board. This is the period that Bill Clinton decided he was a new Democrat. And we know what that means.

AMY GOODMAN: Ken Silverstein, again, he’s our guest, and he’s the investigative journalist who puts out CounterPunch, telling the facts and naming the names. Any last comment on this story before we move on to a couple of others? I think it’s interesting to know the significance of International Paper, because we don’t hear a lot of about it here in Washington or New York. It’s more out in rural areas. But, for example, how it does compare to the pollution that came from Tyson’s chicken farms on the Arkansas River?

KEN SILVERSTEIN: Yeah, terrible. It was one of the state’s worst polluters. They have a big plant at Pine Bluff, and this plant spewed out about 2 million tons of toxic chemicals a year into the air and water. So, this was one of the major polluters in the state of Arkansas, that Clinton went very easy on.

AMY GOODMAN: Let’s talk about another piece that you did entitled “Gingrich and Bro: Rent Them by the Hour.”

KEN SILVERSTEIN: OK. And first, before we get to that, let me just say quickly that I don’t want to say that I did them, because this is a publication I do with Alexander Cockburn, so it’s the two of us doing these stories. So I don’t want him to think that I’m stealing all the credit. In any case, we did a story about Newt Gingrich and John Breaux — 

AMY GOODMAN: John Breaux, of course, the senator.

KEN SILVERSTEIN: — John Breaux, the senator from the state of Louisiana, a Democratic senator — as being classic examples of the sort of politicians who take favors from corporations on a regular basis. Now, Newt, we learned, has — back in January, Newt was flying around the country, and he was attending fundraisers for Republican congressional candidates. It turns out that he was flying to these campaign fundraisers on a U.S. Tobacco corporate jet. He flew as far north as Seattle, as far south as Dallas, I believe. He was all over the country, and he was in a corporate jet. And he was accompanied on the jet by a lobbyist, a Beltway lobbyist from the Advocacy Group, which is a big firm here.

And so, Newt, to raise money for the Republicans, was saving a little money himself by flying around on a corporate jet, and not just any corporate jet, but U.S. Tobacco, which manufactures smokeless tobacco. You don’t hear as much about smokeless tobacco as about cigarettes, but, in fact, it’s far, far deadlier. The Department of Health and Human Services issued a report a few years ago where they said there would be a — there was an impending oral epidemic — an epidemic of oral cancer, due to the growing popularity of smokeless tobacco, especially that great product, cherry-flavored Skoal, which is extremely popular with kids. And so, this is a corporation — well, I think the term “merchant of death” springs to mind here.

So, Newt was — now, let me just say Newt’s — this is not the first time Newt’s been flying around on their plane. Last year, probably many of your listeners have heard of the Bohemian Grove. That’s the elite group which includes people like William Buckley, Gerald Ford, Henry Kissinger, and then they go off into the woods in California and frolic around, sometimes nude, and return to their pre-corporate roots, I guess. Newt flew to the Bohemian Grove’s midsummer encampment last year on a UST plane. And also, in —

AMY GOODMAN: UST, of course, U.S. Tobacco.

KEN SILVERSTEIN: U.S. Tobacco, which is how the company is referred to. And in mid-’95, last year, as well, there was a big fundraiser honoring Newt in New York, and UST lent its plane to 80 Republican members of Congress and flew all of them up there. Must be a pretty big plane for Newt to be flying around on if it could hold 80 Republicans.

AMY GOODMAN: Did you do any Nexus searches to see how many newspapers reported on who was transporting Newt from point A to point B?

KEN SILVERSTEIN: I have not seen a single story on this latest incident where he was attending the fundraisers. Now, it is true that in the past Newt has been caught a couple of times, not, I don’t believe, by the mainstream press, though Common Cause had a story about the Bohemian Grove, which is where I heard about that. What we reported on was this, the fundraising trips earlier this year.

AMY GOODMAN: Now, you report that when it comes to taking money and favors from corporate America, the Democrats are certainly no better than the Republicans. And why don’t you tell us a little about Breaux?

KEN SILVERSTEIN: Well, Senator Breaux is one of the leading Democratic senators in Congress, and he heads what’s called the Majority Trust, which they call the premier donor program of the Democratic Senatorial Campaign Committee. And I got a letter that Breaux sent out to wealthy individuals telling them that if they gave more than $20,000 or more to the Democratic Party, they’d become members of the Majority Trust. And then they could accompany Democratic senators to wonderful events where they would mix the discussion of important issues with things like skiing in Aspen. In January, the lucky contributors went on a ski trip to Aspen, where they were joined with by Howell Heflin of Alabama, Joe Biden of Delaware and Tom Harkin of Iowa. And the memo also — or, the letter also included reference to some events last year. My favorite was the Nantucket weekend, where the $20,000-and-up donors were put up at the White Elephant Inn. They met with a number of senators, and they mixed “relaxing” — quote here — “relaxing summer activities, private receptions and dinners.” So it was quite a fun weekend, I’m sure.

AMY GOODMAN: Now, since we’ve been following the presidential candidates rather closely, and we only have a few minutes here, I didn’t want to leave Senator Bob Dole out of this discussion of U.S. Tobacco.

KEN SILVERSTEIN: Yeah, I’m sorry. I should have actually tried to get to that, as well. Dole, like Newt, is a very, very warm friend of U.S. Tobacco. He’s a frequent flyer on their company jets. But the relationship is even more intricate than that. UST — well, Dole has a PAC, a political action committee, called Better America, and UST has made vast dispensations to his PAC. And the UST senior vice president sits on the board of the Dole Foundation. That is a foundation for the disabled. And Dole, curiously, has been —

AMY GOODMAN: To disable or for the disabled?

KEN SILVERSTEIN: I’m sorry, for the disabled.

AMY GOODMAN: To disable people or for disabled?

KEN SILVERSTEIN: For disabled.

AMY GOODMAN: When you talk about U.S. Tobacco and the disabled.

KEN SILVERSTEIN: You never know. No, but in this case, the Dole Foundation is for the disabled. Now, Dole has been UST’s close — probably its closest friend in Congress. UST has a very good record. They’ve listed — on their lobbying disclosure forms, they’ve listed 24 issues between 1988 and 1993 that they wanted to defeat. They defeated every single one of them. And Dole played a leading role on many, many occasions.

AMY GOODMAN: Well, Ken, we are going to have you back to talk further about these issues. We want to get into the whole issue of one Tommy Boggs, a brother of ABC TV’s Cokie Roberts and one of the most powerful corporate lobbyists in Washington. But we’re going to have to do that next time. Ken Silverstein of CounterPunch, telling the facts, naming the names. You can get this newsletter by calling…

KEN SILVERSTEIN: 202-986-3665.

AMY GOODMAN: That’s 202…

KEN SILVERSTEIN: 986-3665.

AMY GOODMAN: Ken Silverstein, thanks for joining us. Coming up next, the war on drugs. You’re listening to Democracy Now!