Troubled Waters

In the Tom DeLay era--now at least temporarily ended--a meeting of the House Republican Conference usually was a ceremonial affair, at which "Leadership" (always a single word, spoken with a mixture of awe and fear) clued in the flock on Done Deals. The proceedings had the spontaneity of a Baath Party conclave. But last week the erstwhile majority leader, and the rest of the Leadership he had forged since taking effective control of the House in the late '90s, was struggling to maintain its grip. The members applauded him as he proclaimed his innocence of the charge leveled against him: that he had funneled streams of laundered corporate cash into legislative races in Texas. They cheered as he attacked the Democratic prosecutor in Austin. And they didn't argue when he denounced the conference itself for having written a rule that barred him from continuing to serve as majority leader, even under indictment. Speaker Denny Hastert, ever the avuncular wrestling coach, gave a pep talk on the virtues of unity in adversity.

Still, when it came time to discuss precisely what would happen next, discipline broke down. DeLay and Hastert had wanted Rep. David Dreier to step in as acting majority leader. Instead, the hard-charging Roy Blunt got the job. Members demanded full-scale elections sooner rather than later for a new permanent Leadership, and if DeLay doesn't escape his legal problem by January--hardly a certainty--that vote will occur and he won't be in the race. Reaching for inspiration, one acolyte compared the Speaker to Robert E. Lee and DeLay to Stonewall Jackson: when the latter was wounded, the former still won a crucial battle. But another member elicited wry laughter by pointing out that Jackson had been shot, accidentally, by his own troops. Some backbenchers were gloomy and resentful, but unwilling to say so on the record, for fear that the vindictive DeLay might survive. "Leadership has become ossified and hopelessly out of touch," lamented one such member. "They only care about one thing, hanging onto their own power. I'm not ready to take them on, at least not yet, not unless I have to!"

The president's many visits to the Gulf Coast seem to have shored up, at least somewhat, his eroded standing. In the NEWSWEEK Poll, his job-approval rating inched up two points, to a still-dismal 40 percent. But, safely back in the White House, he now has to deal with another disaster area: Republican Washington. The list of official inquiries is long and growing, involving issues ranging from arguably excusable bureaucratic mismanagement to insider trading to allegations of lawbreaking that potentially lead to the highest levels of the White House staff. "Look, the Democrats' numbers are just as low as the Republicans' are," said James Carville, who helped guide Bill Clinton into the White House in 1992. "People see a lot of this stuff just as 'more Washington.' But the danger for Republicans and for Bush is that there are too many things they can't control--and the odds are that all of them aren't going to work out in their favor."

Bush and his fellow Republicans have little margin for error. Three forces--sky-high gasoline prices, the massive costs of rebuilding the Gulf Coast and ever-gloomier public assessments of the war in Iraq--have combined to weaken Bush's reputation as a strong leader, and leave him vulnerable to the kind of second-term fiascoes that tend to befall all presidents: think Ronald Reagan and Iran-contra, or Bill Clinton and Monica Lewinsky. Indeed, polltaker Frank Luntz, who helped develop the "Contract With America" message that swept Republicans to power in 1994, was on the Hill last week warning the party faithful that they could lose both the House and the Senate in next year's congressional elections.

The Republicans' power outage is real--and the historical irony is as vast as Texas. Beginning in the 1950s, the Democratic Party of Texans Lyndon Johnson and Sam Rayburn built a congressional machine of unrivaled power. But starting in the '80s, led by a firebrand named Newt Gingrich, Republicans led a revolt from below in the name of smaller government and an ethically cleansed Congress. In 1989 Newt & Co. forced out Democratic Speaker Jim Wright--a Texan, too, who resigned over charges that he profited improperly from book sales--and five years later the GOP took control of the House after a Biblical 40 years in the wilderness. But it took the Republicans only 10 years to become yet another ruling party beset by charges of profligate spending, bloated government and corruption--a party led by two Texans, Bush and DeLay, who don't particularly care whether they are beloved outside their inner circle. To paraphrase David Mamet, the Republicans became what they beheld.

And there is much to behold. Michael Brown, the hapless yet arrogant former head of FEMA, managed to anger even putative Republican allies in an appearance before a House committee. Democrats consider the probe a whitewash in waiting, but Republican Chairman Tom Davis vowed a thorough look at the government's pre- and post-Katrina performance. Questions have already arisen about no-bid contracts awarded to companies with ties to one of Bush's closest political friends from Texas, former FEMA head Joe Allbaugh, who has denied any wrongdoing--and who, in any case, has the hide of a rhino.

The skin is a little more sensitive on the princely Senate majority leader, Bill Frist. Buffeted by the complex politics of his job, he now finds himself the subject of a full-scale investigation by the Securities and Exchange Commission. A physician, his substantial wealth is partly derived from HCA Inc., a leading managed-care and hospital company founded by his family back home in Tennessee. The SEC is examining Frist's decision to dump all the HCA stock from the "blind trust" in which he placed it after he was elected in 1994. The stock price dropped shortly after the sale. By Frist's account, he decided to initiate the sale last April, and says that he had no information that wasn't available to the public when he did so.

As Frist deals with new questions of insider trading, the White House continues to deal with old questions of insider leaking. The issue: who revealed the classified identity of CIA agent Valerie Plame, wife of Bush administration foe Joe Wilson? Last week Judith Miller, The New York Times reporter who had spent 85 days in jail for refusing to testify on the matter, cut a deal, winning freedom and revealing that her source was the same one others have identified: vice presidential chief of staff Lewis (Scooter) Libby. Miller's testimony is said to be the last being sought by Patrick Fitzgerald, the special prosecutor. He is expected to conclude his work soon, and may issue a report. If he does, it can be expected to include potentially embarrassing, if not necessarily criminal, actions and phone calls by insiders such as Libby and Bush political consigliere Karl Rove.

The DeLay indictment has gotten tons of ink. Even before last week, the now suspended majority leader had an astonishingly high "name ID" in the country, and a very low "favorability" rating. But Washington legal experts see the most serious threat to the GOP machinery in the widening federal probes of lobbyist Jack Abramoff. A hustler with ties to conservatives dating to his days in the College Republicans, Abramoff made it his business to do favors for DeLay--from arranging golf trips to sponsoring fund-raisers--in exchange for access to Leadership. If DeLay, as Hill insiders say, rose to power in part by being the "concierge" to House Republicans, Abramoff, in turn, rose by being concierge to the concierge.

Now the deputy concierge is under the microscope. He and a business partner were indicted by a federal grand jury in Ft. Lauderdale, Fla., on charges that they tried to fraudulently purchase a fleet of gambling boats from a businessman who was later killed in a gangland-style hit. Abramoff, who denies any wrongdoing, was accused of having used his connections with members of Congress to facilitate the deal.

In Washington, meanwhile, a separate investigation is gathering speed. It has resulted so far in one arrest: David H. Safavian, the head of procurement policy at the Office of Management and Budget. A former lobbying partner of Abramoff's, he is accused of lying to the FBI about the assistance that he had given Abramoff on a lucrative land deal with the General Services Administration. Safavian, who has denied wrongdoing, is expected to be indicted this week. Investigators, NEWSWEEK has learned, are pressing him for information about Abramoff's dealings with members of Congress.

The Abramoff probe, originally centered on allegations that he had fleeced tens of millions of dollars from Indian tribes eager for gaming licenses, has complicated life at the Justice Department. Bush has nominated Timothy Flanigan, who had been deputy White House counsel, to be deputy attorney general--the key No. 2 position. But then Flanigan disclosed to Congress that, as a lawyer for the Tyco Corp., he had hired Abramoff to lobby on an obscure issue, the maintenance of certain offshore tax breaks. (Flanigan also told Congress that he had hired Abramoff in part because of the lobbyist's connection to DeLay.) Tyco paid Abramoff an eye-popping $1.7 million. Abramoff, according to Flanigan, claimed that he had lobbied Rove. (The White House says Rove has "no recollection" of talking to Abramoff about Tyco matters.)

Congressional investigators are even more interested in another $1.5 million that Tyco paid, at Abramoff's direction, to a company called Grassroots Interactive. Abramoff, who declined to comment, allegedly controlled the firm, but, according to Flanigan, didn't tell Tyco. Lawyers for the conglomerate later complained that Tyco had been ripped off by Grassroots Interactive. Democrats on the Senate Judiciary Committee are pressing for answers about what happened to the cash.

In politics, timing is everything, and GOP officials worried that the many Abramoff investigations--not to mention a DeLay trial in Texas, if it comes to that--could take place next summer, just before the midterm elections. In the meantime, Leadership wrestled with their own characteristically crucial issues. Such as: who occupies the Majority Leader Suite in the Capitol? DeLay has moved out, but most of his official staff have remained. Blunt will not move in, officially, keeping his whip office as home base. Instead, Blunt, Dreier and Deputy Whip Eric Cantor will hover in the vicinity. So the office will remain officially vacant. It's symbolic evidence of Leadership--or the absence of it.