Whitewater row refuses to go away

It is the controversy which will not die. A new book in the shops, a trial which opened in Little Rock this week, an ugly row which threatens to tie up business on the floor of the US Senate - one way and another, the Whitewater affair is set to hound President Clinton throughout his re-election campaign.

Four years have passed since the first mention in the national press of a failed property venture in northern Arkansas, in which the businessman Jim McDougal in 1978 offered a 50 per cent share to his friends Bill and Hillary Clinton, the probable next Governor of the state and his ambitious lawyer wife. Today Whitewater is a term embracing not just that land deal, but an imbroglio of past personal and financial dealings of the 42nd President. Mr McDougal meanwhile, along with his wife Susan and Jim Guy Tucker - the man who took over as Arkansas's Governor when Mr Clinton moved on to the White House - is now defending himself against fraud and conspiracy charges in a federal court in Little Rock, the first trial arising from a special prosecutor's two-year investigation of the Whitewater affair.

The Clintons have been neither indicted nor charged with any offence, but even before opening arguments had ended on Tuesday, the President's name had been aired in the courtroom, in allegations by a prosecution lawyer that he improperly pressured a local banker in 1986 to make a $300,000 (pounds 200,000) loan to Ms McDougal. That money in turn disappeared into the Madison Guaranty savings bank, owned by her husband and which collapsed that year, at a cost to US taxpayers of $60m.

The trial will last two months, and before it is over Mr Clinton will have suffered the almost unprecedented embarrassment for a sitting President of testifying in a criminal case in which suspicions swirl around him. The ultimate indignity of a personal appearance in the courtroom is unlikely. But either in videotaped cross-examination, or via a live satellite link from Washington, the McDougal defence insists, Mr Clinton will give evidence.

"A bunch of bull," he has called suggestions of his involvement in the $300,000 loan - but public interest in the case is unlikely to subside. Further Whitewater charges may well be brought by Kenneth Starr, while the author James Stewart, responsible for the best-selling Wall Street expose Den of Thieves, may have another blockbuster on his hands.

According to Blood Sport: The President and His Adversaries, excerpts of which appear in the latest issue of Time magazine, the Whitewater venture was conceived by Mr McDougal as a favour to the impecunious young couple. When it was clearly a money-loser, Mr McDougal tried to buy them out - only to be rebuffed by Mrs Clinton, hoping that it would provide enough income to pay for the university education of the couple's daughter, Chelsea.

As such, the book provides more corroboration that as a partner in the Rose law firm working on Madison and other McDougal-related accounts, Mrs Clinton knew more about the bank, and Whitewater, than she has admitted. That in turn will only keep Whitewater alive on Capitol Hill - through the summer and perhaps beyond.

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