YOU ARE HERE: LAT HomeCollections

Deaver Trial Offers Window on Inner Circle Power-Brokers

November 27, 1987|ROBERT L. JACKSON | Times Staff Writer

WASHINGTON — The perjury trial of former White House aide Michael K. Deaver, now in its second month, is providing a captivating look inside the rarefied world of high-level Washington power-brokering.

In the spotlight is a man who had the ultimate lobbying asset to sell--access to President Reagan's inner circle--and who eagerly collected fees that vastly outstripped his old government salary.

Deaver's access was unquestioned. He had served Reagan for 19 years, starting with Reagan's two terms as California governor, and his wife, Carolyn, was personally close to Nancy Reagan. At the White House, his bureaucratically unimpressive title--deputy chief of staff--belied his role as the keeper of the Reagan image, the man who, said former Budget Director David A. Stockman, busied himself with "stage-managing" the presidency.

After resigning from the White House in May, 1985, to set up his own public relations business, Deaver became a fast-moving quick-fix artist who tried to put in the right words for his clients with top officials, according to evidence presented in the courtroom of U.S. District Judge Thomas Penfield Jackson. Prosecution witnesses said that phones in Deaver's old colleagues' offices promptly began to ring.

Special Tax Breaks

Deaver urged Robert C. McFarlane, then Reagan's national security adviser, to support U.S. firms that wanted to keep special tax breaks for doing business in Puerto Rico, according to testimony. Deaver dropped in on Secretary of State George P. Shultz to discuss the same deal, and he contacted John M. Poindexter, who succeeded McFarlane, to smooth the way for a Korean envoy who wanted a personal audience with the President.

In one particularly impressive show of influence, Deaver gave an investment banker a special White House phone number to call him back aboard Nancy Reagan's aircraft.

Some past and present government officials--including McFarlane, Shultz and Poindexter--have testified about their contacts with Deaver. Whitney North Seymour Jr., the court-appointed independent counsel who is prosecuting the case, said that Deaver made "hundreds of thousands of dollars . . . for a few phone calls and contacts."

But illegal lobbying is not the criminal charge that Deaver faces. Although a post-Watergate law prohibits lobbying of former colleagues, Seymour determined that its restrictions did not apply in Deaver's case because his White House office was sufficiently distanced in the bureaucracy from those of the officials whom he lobbied.

Rather, Deaver stands accused of five counts of lying to investigators last year in a vain effort, as described by Seymour, "to cover up what he had done." He gave sworn statements to Seymour's grand jury and a congressional subcommittee that he did not recall lobbying such officials as McFarlane, Shultz and Poindexter. If convicted, he faces maximum punishment of 25 years in prison and $34,000 in fines.

Deaver has not yet testified in his trial but is expected to do so. His lawyers, who have not yet presented their case, have said they have medical evidence that they hope will persuade jurors that their client never intentionally lied, only that his memory was impaired by bouts with alcoholism.

Perjury aside, the five-week-old trial at which more than 40 witnesses have appeared has provided fascinating glimpses into the attempt--and ultimate failure--of a long-time close confidant of the Reagans to parlay that friendship into a fortune.

As he was making plans to resign from the Administration, Deaver, whose government salary was $75,000, consulted some friends, including Washington attorney Kenneth A. Lazarus, jurors have been told.

$500,000 a Year

Deaver had been offered $500,000 a year by an established Washington public relations firm, Lazarus said. But Lazarus advised Deaver that he could easily make more if he started his own firm.

For Deaver, who had played the piano to put himself through San Jose State College in the late 1950s, the advice was highly gratifying, Lazarus testified.

Within days of his departure from the White House on May 10, 1985, Deaver opened an office and signed up to do lobbying for the government of Canada, including work on the acid rain problem, for $105,000 a year, other witnesses said.

At about the same time, he obtained a $250,000 contract from Trans World Airlines, which wanted him to persuade the Transportation Department to help TWA combat a takeover attempt, and a $200,000 fee agreement from the Smith Barney investment firm, which wanted help in preserving a U.S. tax break for American companies in Puerto Rico.

Deaver promised his new clients, the jury was told, that he would contact his friends in the Administration.

Los Angeles Times Articles