News > Jobs & Economy
Kerry adviser a Whitewater casualty
Aide Roger Altman, Clinton's former No. 2 man at Treasury, saw star dimmed by scandal.
March 3, 2004: 4:10 PM EST
By Mark Gongloff, CNN/Money staff writer

NEW YORK (CNN/Money) - The economic team of Sen. John Kerry, the likely Democratic nominee for president, shares many ties with the Clinton administration -- including lingering echoes of the Whitewater scandal.

Kerry's top economic adviser, Roger Altman, was a Deputy Treasury Secretary under Clinton from 1993 to 1994. A long-time Clinton friend, he was part of a crew of "deficit hawks" in the early Clinton administration who argued that taming runaway federal budget deficits would help the economy in the long run.

"The country -- and Washington, too -- is so used to fiscal irresponsibility that there's a shock aspect to the idea that we're actually going to rein in the nation's finances," he told the Los Angeles Times in February 1993. "And it's really not easy to persuade people that we should do it, that it's important to do it."

Though conservatives at first balked at Clinton's proposed remedies -- which included some tax increases -- Altman was influential in helping to sell the budget plan to Congress, and he was considered a potential successor to then-Treasury Secretary Lloyd Bentsen.

But his career path was altered dramatically in 1994, when he resigned amid accusations that he was not fully forthcoming with Congress about his contacts with the White House concerning the lengthy investigation into a failed Clinton real estate deal, known as Whitewater.

Though Altman maintained he had not intentionally misled Congress, he resigned in August 1994, saying he hoped his resignation would "help to diminish the controversy." He was later cleared of any wrongdoing by a special prosecutor.

Altman did not return calls seeking comment.

Kerry's campaign said it was glad to have Altman on board, both to advise Kerry on economic issues and to recruit other prominent economists to help.

"He has a ton of respect throughout the economic community, on Wall Street and with a broad range of other people," said Sarah Bianchi, policy director for the Kerry campaign. "He's run a very balanced and fair process, and we think he will continue to do so throughout the campaign."

Bianchi would not speculate about Altman's chances of winning a post in a potential Kerry administration.

"That's a little ahead of where we are now," she said.

Recruiting Clinton-era talent

After leaving Treasury, Altman went on to found Evercore Partners, a closely held investment and financial advisory firm, where he is still chairman.

Since joining the Kerry team last year, he has helped recruit two former top Clinton economic advisers, Laura Tyson and Gene Sperling, to prep Kerry on economic issues.

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Meanwhile, Clinton Labor Secretary Robert Reich has helped Kerry formulate a health-care plan, and Princeton economics professor Alan Blinder, another Clinton adviser and vice chairman of the Fed in the mid-1990s, has also given economic advice.

"If you liked the first eight years of Bill Clinton, you're going to like the first four years of John Kerry," the Massachusetts Democrat said last month on ABC's This Week with George Stephanopoulos.

Despite the fears of some conservatives that the tax increases of 1993 would cripple the economy, Clinton presided over the economy's longest expansion since World War II, and the budget deficit eventually turned into a surplus, with the assistance of Congressional spending controls.

Kerry and other Democrats in the campaign have promised a return to those glory days -- potentially a winning campaign message, with the budget once again in deficit and an economy which has struggled to generate jobs after the 2001 recession.

Roger Altman
John F. Kerry
Presidential election

But Clinton's presidency is also associated with scandal -- one reason former Vice President Al Gore stayed away from the Clinton record when running for president in 2000.

Though the Whitewater investigation led eventually to the Monica Lewinsky scandal, which led to Clinton's impeachment, Clinton and others in the White House were cleared of wrongdoing in the real estate deal itself.

And former Whitewater special counsel Robert Fiske specifically cleared Altman and other Treasury officials of any wrongdoing in the matter.

A former Wall Street investment banker, Altman was thrust into the scandal in 1993, when he was appointed to temporarily take charge of the Resolution Trust Corporation (RTC), a government agency charged with cleaning up the savings and loans crisis in the 1980s.

RTC was then investigating Madison Guaranty Savings & Loan, an Arkansas S&L owned by the late James McDougal, who joined Bill and Hillary Clinton to invest in Whitewater, an Arkansas real estate development that ultimately failed.

Testifying before Congress in February 1994, Altman was asked if he had discussed the Whitewater investigation with the White House. In response, he mentioned only one meeting.

But subsequent testimony by Altman and others suggested many more contacts between Treasury and the White House about the scandal, and lawmakers began to call for his resignation, saying his credibility had been damaged.

In his resignation, Altman said he regretted "any mistakes or errors of judgment [he] may have made."  Top of page

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