For years, international financier Richard C. Blum's vast business portfolio has persisted as a nettlesome issue for his wife, Sen. Dianne Feinstein (D-Calif.), a vocal proponent of increased China trade.
Three years ago, he vowed to turn over any profits from his China investments to charity.
Last year, as Feinstein prepared to run for reelection, Blum says, he disposed of his remaining personal investment in mainland China to avoid any hint of impropriety.
Even so, Blum continues to manage a partnership that has invested in China, records and interviews show. And he, his partnerships or accounts he manages have major interests in an airline seeking U.S. government approval to expand its China business and in a South Korean bank that operates a joint venture in China.
After inquiries about his China-related business, Blum pledged this week that he "will not invest in mainland China or Hong Kong as long as Dianne Feinstein is a U.S. senator to avoid even the appearance of conflict."
He said profits from Hong Kong investments, like those from the mainland, would go to charities he established to benefit impoverished Himalayan people. He specifically committed about $400,000 from a Hong Kong real estate investment sold this year.
Through a spokesman, Blum said any money he receives from managing the investments of others in China also will go to charity.
"We have done everything we possibly can," Feinstein said in exasperation. "I can't tell my husband to die. I can't tell him to give up what he does. . . . I don't know what more I can do. I mean, get divorced and live in sin, I suppose."
Blum's finances have drawn scrutiny in part because his holdings and the funds he manages are so extensive and complex that government-required disclosure forms do not show precisely where the money is invested.
His China investments have become a target because Feinstein long has been active in promoting U.S.-China relations and recently supported the congressional vote to grant China permanent normal trade relations.
Questions about Blum's financial affairs illustrate the difficulties facing any candidate whose spouse has large financial interests. The issue was raised this year by Rep. Tom Campbell (R-San Jose), Feinstein's opponent in the Nov. 7 election. When there was speculation that Feinstein could be Vice President Al Gore's presidential running mate, political analysts cited her husband's investments as a potential liability.
"All candidates with rich and powerful spouses are walking in the shadow of Geraldine Ferraro," said John J. Pitney Jr., associate political science professor at Claremont McKenna College, referring to the 1984 Democratic vice presidential candidate whose husband's business became a political albatross.
Blum says he has never benefited from his wife's positions on China. "I can't think of one single reason why the Chinese leadership would be wanting to help us with investment opportunities," Blum wrote to The Times, calling himself an outspoken critic of China's human rights record and a supporter of Tibet's exiled religious leader, the Dalai Lama.
Blum declined to be interviewed, but he responded in writing to questions through a spokesman, who emphasized that "Sen. Feinstein does not participate in Mr. Blum's business in any way."
Feinstein grew angry when asked about her husband's investments.
"There's no conflict of interest," the senator said in an interview. "I take what I do very seriously. It's my lifeblood. I'm not going to jeopardize my public trust."
Feinstein provided The Times a letter showing that she consulted the Senate Ethics Committee before the vote on China trade. The letter said the committee did not consider her vote a conflict because it could benefit all people doing business in China, not just Blum.
Gary Ruskin, director of the Congressional Accountability Project, a government watchdog group in Washington, said he sympathizes with the desire of public officials to keep parts of their lives private.
But with the hundreds of millions of dollars handled by Blum and his firm, Feinstein and Blum must "bend over backward in order to convince voters that they're not profiting from her governmental actions," Ruskin said. That means, he said, fully disclosing Blum's holdings.
Feinstein's disclosure statement--which runs 84 pages and indicates that she and Blum had at least $27 million in assets at the end of 1999--lists Blum's partnerships but not all the investments of those partnerships.
The couple made available their 1999 tax return, showing they paid $1.7 million in taxes on almost $9.3 million in income while donating $1.9 million to charity.
Extensive Ties to Asia
Blum, 65, is a money manager whose business is based in San Francisco, not far from the Transamerica pyramid.