THE WHITE HOUSE
Office of the Press Secretary
PRESS BRIEFING BY SENIOR ADMINISTRATION OFFICIALS
The Roosevelt Room
4:25 P.M. EDT
SENIOR ADMINISTRATION OFFICIAL: Why don't we get started? You've all been provided the form with the relevant attachments, as well as the summary statement from Mr. Cutler, which we don't need to read through. It summarizes the basic facts from the financial disclosure report.
I would just note one reference here. In the second paragraph, second sentence -- the range of income received by the President and Mrs. Clinton and Chelsea Clinton in 1993. That, of course, is the -- does not include the President's salary. The financial disclosure forms do not require the reporting of the President's salary from the federal government. Of course, the President's salary is $200,000 a year. And as we released on the tax forms, he made that minus 20 days that he was not in office from last year.
Q Are we on the record?
SENIOR ADMINISTRATION OFFICIAL: This is a BACKGROUND BRIEFING.
SENIOR ADMINISTRATION OFFICIAL: I might add, that having filled out one of these forms myself recently, you should all be glad you're still in private life. (Laughter.)
SENIOR ADMINISTRATION OFFICIAL: For some of us the forms are easier to fill out than others, however. (Laughter.) In 40 years, my form is going to be very tough to fill.
Q I didn't realize that as a 130-day employee, you have to fill out one of these.
SENIOR ADMINISTRATION OFFICIAL: Well, I'm told I didn't have to, but I did anyway.
Q When is that up, sir? When are you --
SENIOR ADMINISTRATION OFFICIAL: I'm also told by our ethics expert over here, it's not quite like Cinderella's coach. You don't turn into a pumpkin at midnight. But I would guess September, early September. It depends on how many weekends they work me.
SENIOR ADMINISTRATION OFFICIAL: The front page are Beth Nolan's signature and Lloyd Cutler's signature.
For the assets and sources of income, which is Schedule A, as the opening statement attached says the range of assets attached held by President and Mrs. Clinton and Chelsea was between $633,015 and $1,620,000. The range of income we've already discussed, with the footnote that that does not include the President's federal salary.
The President, Mrs. Clinton and Chelsea established a blind trust that was certified by the Office of Government Ethics in July 1993. They transferred substantially all of their assets into the trust, except bank accounts, life insurance and the President's interest in the Arkansas Public Employees Retirement system.
Q Why the range --
SENIOR ADMINISTRATION OFFICIAL: That's because in the forms, to protect the privacy interests of government officials, you report in a range. For example, the ranges that you'll see if you look at the form on assets are $1,000 to $15,000; $15,000 to $50,000; $50,000 to $100,000; $100,000 to $150,000. So the figures you've been given are the minimum and the maximum of each range.
Q That's quite a spread.
SENIOR ADMINISTRATION OFFICIAL: But that's deliberately done by Congress to protect privacy interests. And as you see, over a million -- even if you have $10 million, you only have to report over a million.
Q The final number is what the assets were worth at the end of '93?
SENIOR ADMINISTRATION OFFICIAL: No, someplace in between those two numbers.
Q And how do these numbers compare to last year's form numbers?
SENIOR ADMINISTRATION OFFICIAL: Well, let me go through your point about the asterisks that's on here -- some assets that appear on Schedule A of the President's form filed last year for in May of 1993 do not appear on Schedule A of this form, covering calendar year 1993 because they were transferred into the trust and they did not earn more than the $200 limit that the form requires before being transferred into the trust.
Other assets that are listed here that are on Schedule A that are marked with an asterisk were transferred to the trust but appear on Schedule A of the 1994 annual report because they earned income greater than $200 before that asset was transferred into the blind trust. And those are marked accordingly.
Q who the blind trustee is and where the trust is submitted?
SENIOR ADMINISTRATION OFFICIAL: It's an institution trustee.
SENIOR ADMINISTRATION OFFICIAL: Boston Harbor Trust Company, which was reported on their tax forms. The other remaining items of income from Schedule A are royalties that were from the appearances on the Arsenio Hall Show. They were listed, again, on the tax form from EP Talent and from this New York Times op-ed piece authored by the President that predated his inauguration.
Q Do you have figures on what the royalties were, other than less than $1,000?
SENIOR ADMINISTRATION OFFICIAL: The tax form listed the actual royalties. I believe it was $400, as I recall, something like that.
Q From which one?
SENIOR ADMINISTRATION OFFICIAL: The royalties from EP Talent.
Any other -- anything else on Schedule A?
Q Just again on the range. The numbers that -- you just added up all the minimums and maximums to get this number, is that right?
SENIOR ADMINISTRATION OFFICIAL: Yes.
Q At the bottom of page 3 is -- cannot read the footnotes.
SENIOR ADMINISTRATION OFFICIAL: You cannot read the --
Q The footnotes at the bottom there.
Q Some of this is just cut off.
SENIOR ADMINISTRATION OFFICIAL: -- received ownership upon completion of administration of Hugh Rodham's estate April 1994; and then there's a Note 3, "will be transferred into the blind trust."
Q What are they referring to this?
SENIOR ADMINISTRATION OFFICIAL: The Schwab account --
Q at these schedules -- J, I believe, is joint; S, spouse, in column 1. I can't remember what DC is.
SENIOR ADMINISTRATION OFFICIAL: Dependent child.
Q What was that?
SENIOR ADMINISTRATION OFFICIAL: Dependent child.
SENIOR ADMINISTRATION OFFICIAL: Or daughter, Chelsea, whatever you like. (Laughter.)
Q Did she earn -- Chelsea?
SENIOR ADMINISTRATION OFFICIAL: She paid --
Q So that actually -- that question follows mine. There's three separate blind trusts?
SENIOR ADMINISTRATION OFFICIAL: There's one trust instrument, but there are separate schedules and separate trust instruments within this larger umbrella trust. So there's one trust agreement.
Q Their assets are all segregated within those?
SENIOR ADMINISTRATION OFFICIAL: Their assets are segregated.
Q Just what's the reason for doing it that way?
SENIOR ADMINISTRATION OFFICIAL: That would be an arrangement made by the trust.
SENIOR ADMINISTRATION OFFICIAL: Yes, I think that's a very common arrangement.
Q Why the X under the assets column? If this was royalty, why not just --
SENIOR ADMINISTRATION OFFICIAL: That means it has no value. It's not an asset.
Q Oh, you've got to mark it. Even if it's plain income, you still have to mark something in the assets?
SENIOR ADMINISTRATION OFFICIAL: If you look up on top, it says, identify each asset or source of income, which is that which generated over $200 in income during the reporting period. So any source, like a law firm or whatever.
Q On page four, what is the Little Rock Residential Housing Facilities?
SENIOR ADMINISTRATION OFFICIAL: They're bonds.
Q They're bonds? Arkansas housing bonds?
SENIOR ADMINISTRATION OFFICIAL: Yes.
Q Then it's not a property itself?
SENIOR ADMINISTRATION OFFICIAL: That's right.
SENIOR ADMINISTRATION OFFICIAL: You don't have to list personal residences on the form.
Q I didn't know if she was getting income --
SENIOR ADMINISTRATION OFFICIAL: Oh, I see, for investment.
Q So again, at the bottom of that page, the blind trust itself, at least one of three -- well, it looks like the spouse's blind trust is valued at between $500,000 and $1,000,000. Would that be Mrs. Clinton's assets in the blind trust?
SENIOR ADMINISTRATION OFFICIAL: That is correct.
Q They're worth a lot more than the President if TC is Clinton. (Laughter.)
SENIOR ADMINISTRATION OFFICIAL: Anything else on Schedule A? Nothing else on Schedule A? Okay, for Schedule B.
SENIOR ADMINISTRATION OFFICIAL: Just shows you he was an honest politician.
SENIOR ADMINISTRATION OFFICIAL: The majority of the transactions reported on Schedule B of the President's form here are transfers of the assets into the blind trust, as you can see. The others include exchanges -- the Stein Roe Special, Strong Opportunity -- both the President's and the First Lady's interest in these funds; and a sale of Cortland Municipal, which is listed as well on the attached, the proceeds of which were transferred into the trust.
One interest that was reported as an asset on the President's 1993 annual report is Mrs. Clinton's interest as a limited partner in Value Partners, one limited partnership, which is an investment partnership. Value Partners is reported on Schedule B of the President's 1994 annual report because it was transferred to the trust. It is not reported on Schedule A of the other form because the income for the entire year was reported by the general partner to the trustee. It was not broken down by pre-trust and post-trust earnings.
The trustee, in turn, reported all the income earned by the trust for the calendar year, which is on Schedule A, page four. Value Partners is a private limited partnership -- investment partnership -- similar to a mutual fund in which Mrs. Clinton was a limited partner.
As in a mutual fund, Mrs. Clinton as a limited partner had no input control or oversight -- no investment power whatsoever with respect to any investments made by Value Partners. Those investment decisions were left to the sole discretion of the fund's investment manager.
Mrs. Clinton had a less than one percent interest in the partnership. And that interest was placed in the Clinton's blind trust in July of last year, of 1993. The Office of Government Ethics Regulations required that the President include a report of the 1993 transactions in Value Partners before the date when the blind trust was created. This listing thus sets forth all the transactions here that you see listed valued above $100,000 for Value Partners. And that is all the transactions in which Mrs. Clinton's one percent limited partnership interest could be valued at $1,000 or more.
Q The exchanges between Stein Roe and for a Strong Opportunity, did all of that eventually wind up in the blind trust?
SENIOR ADMINISTRATION OFFICIAL: Page 7 deals with Stein Roe and then A Strong Opportunity as well as Cortland.
Q Could you provide just a bit more background on Value Partners? Who runs it? Who is the general partner and who gets -- who got the opportunity to go into it? Is there a private or semiprivate offering, a public thing like a mutual fund, or what?
SENIOR ADMINISTRATION OFFICIAL: I don't know a lot about it. It's a limited partnership that I believe is managed out of Little Rock. It's not like a mutual fund in the sense it is not publicly traded. But that's really about all I can tell you about it.
SENIOR ADMINISTRATION OFFICIAL: And it doesn't have shares, it has partnership interests.
SENIOR ADMINISTRATION OFFICIAL: Right -- limited partnership interest.
Q And do they -- what do they invest in, or do you all know?
SENIOR ADMINISTRATION OFFICIAL: They invest, as I understand it, in a wide variety of marketable securities. And they have a number of transactions and the transactions that occurred in '93 up to the time the asset was transferred into the blind trust is shown in the attachments that you have.
Q Back a moment on assets. I recognize that this was set up by Congress, these forms and these ranges to provide public officials some sense of privacy. At the same time, on the Hill you'll notice many members will also provide with their financial disclosure a statement of net worth. Why not, given all the controversy and focus on the Clintons' finances this year, why not just give us a figure, what are they worth? Was that discussed?
SENIOR ADMINISTRATION OFFICIAL: The Clintons released all their tax forms for the past --
Q But that doesn't address net worth.
SENIOR ADMINISTRATION OFFICIAL: In fact, it would be impossible to give you a statement of -- an accurate statement of net worth with a blind trust. We don't know what the value of the assets would be. So we could not say for certainty.
Q But you knew when it all went into the trust which was just less than a year ago.
SENIOR ADMINISTRATION OFFICIAL: But that was in July.
Q report back to them about how the trust was performing?
SENIOR ADMINISTRATION OFFICIAL: Very general reports.
Q You mean there's no statement from the trust as to the bottom line on that trust? I thought there usually is.
SENIOR ADMINISTRATION OFFICIAL: -- income statement, but they don't know what the underlying asset is --
Q I realize that, but don't they know each year --
SENIOR ADMINISTRATION OFFICIAL: They don't know what they're making or not making on it.
Q a valuation of the trust?
SENIOR ADMINISTRATION OFFICIAL: They get a Schedule K1 which shows the income in the trust, all of which is reflected on their tax return for 1993.
Q It could go bust and they'd never know it.
SENIOR ADMINISTRATION OFFICIAL: Well, they would know --
Q What you're saying is that we have a more concise understanding of their income in 1993 from the tax returns that we got than we do from here.
SENIOR ADMINISTRATION OFFICIAL: The tax returns list income and this is listing assets plus income. So there's a bit of difference.
Q Can't they take the amount that they put into the trust and then add the income figure --
SENIOR ADMINISTRATION OFFICIAL: Remember that the trustee of the blind trust is free to sell this investment in Value Partners, and for all we know, may have done so.
Q But it's still not clear from your answers, do they or do they not get each year from the trustee of the blind trust a figure that shows the value of that trust. Not just the income, because the trust is composed of assets which rise or fall in value during the year.
Q This report had to be prepared --
SENIOR ADMINISTRATION OFFICIAL: I'm in no doubt that it's probable that the blind trustee, Boston Harbor, gets such a statement.
Q Get's what?
SENIOR ADMINISTRATION OFFICIAL: The blind trustee of Boston Harbor may get such a statement, but he may not communicate that to the Clintons.
SENIOR ADMINISTRATION OFFICIAL: They are entitled to part of the aggregate market value, but I don't know whether they receive such a report or not.
Q And in order for you to prepare this financial disclosure statement and put the X in the right box, someone would have to know what the value is of the trust. The answer to Amy's question about why not just say what their net worth is -- they may not know it themselves, but someone acting on their behalf certainly has that information available.
SENIOR ADMINISTRATION OFFICIAL: Yes. I mean, I don't know the answer unless one of my colleagues knows specifically for how that was filled in. But in terms of --
SENIOR ADMINISTRATION OFFICIAL: We can take the request under advisement.
SENIOR ADMINISTRATION OFFICIAL: We can take the question.
Q Does the trustee have to notify Mrs. Clinton when it sells off an asset?
SENIOR ADMINISTRATION OFFICIAL: Well, periodically, I imagine that's done.
Q When an asset is sold?
SENIOR ADMINISTRATION OFFICIAL: When an asset is sold.
Q But not what replaces it or what -- so there's nothing on here that would tell us what's still in the blind trust and not?
SENIOR ADMINISTRATION OFFICIAL: No.
SENIOR ADMINISTRATION OFFICIAL: That's the whole point of a blind trust, people don't know.
Q She's entitled to know what's sold and what's not - -
SENIOR ADMINISTRATION OFFICIAL: She knows when something goes out because whatever conflict she might have she would possess. When you put funds into a blind trust, that doesn't remove the conflict on what goes in until you are told that it has been disposed of.
Q But she would know what's in the blind trust of these --
SENIOR ADMINISTRATION OFFICIAL: She would know if it had been sold out of the blind trust.
Q not knowing exactly what assets may have been bought or -- are you entitled to know -- blind trust what the net value of it is?
SENIOR ADMINISTRATION OFFICIAL: You may be entitled to know the net value periodically, but not what the particular components are.
Q Right. So that would mean that they are entitled to know what their net worth is.
SENIOR ADMINISTRATION OFFICIAL: I said we'd take this request for a statement in that regard under advisement.
Q Can I ask one other question about the distance of the three trusts within the trust? Many married couples pool their financial resources to the extent that they have them. Can anybody answer the question about why this was set up to segregate the First Lady's and the President's assets?
SENIOR ADMINISTRATION OFFICIAL: I don't know the answer to that.
SENIOR ADMINISTRATION OFFICIAL: I believe it's quite normal in a family when a husband and wife have separate assets.
Q This may just be bad memory, but what happened to the Midlife investments or Midlife partnership or something which was on last year's asset form?
SENIOR ADMINISTRATION OFFICIAL: I know that Midlife Investments has been determined to have no value.
SENIOR ADMINISTRATION OFFICIAL: And that was listed on the tax form.
SENIOR ADMINISTRATION OFFICIAL: It was on the tax form. And I think it had $3 in income for 1993. And that's way under the threshold for reporting.
Q But that wasn't the same as the value of the asset. But you're saying the asset has no value?
SENIOR ADMINISTRATION OFFICIAL: It was determined to have no value. I mean, that's what we reported during the tax --
SENIOR ADMINISTRATION OFFICIAL: An asset is not reportable unless it has at least $1,001 worth of value at the end of the reporting period, or it produces income at least $201 in the reporting year.
Q If I could just back up and clarify one thing that you said, based on what went into the blind trust, the Clintons have to assume they have that -- they own that and have that potential conflict unless they're notified that it's sold?
SENIOR ADMINISTRATION OFFICIAL: Until they are notified that something has been sold -- that is correct.
Q Could I ask you a broad question? This is the sort of fourth or fifth meeting we've had in this room talking about the Clintons' finances. What is the purpose of this sort of disclosure in this sort of detail?
SENIOR ADMINISTRATION OFFICIAL: Congress decided that every public official should file this form once a year.
Q But you've gone to some effort here to go through this, as you have on --
SENIOR ADMINISTRATION OFFICIAL: As you recall, several months ago the President stated before the press conference in the East Room that he wanted to make sure that we were as open and as accessible with information; that in terms of all personal financial matters, he was releasing additional tax forms; that broadly, in terms of the responsibility of the White House for ongoing investigations, that we would be complying -- that every White House official would be complying. And it was our judgment that background sessions like this could answer the requisite questions.
Q In that spirit, would you assure us that not only will you take the questions about net worth, but have the Clintons indeed received a statement of net worth? Could you communicate that information to us?
SENIOR ADMINISTRATION OFFICIAL: We'll take the question.
Q Aside from the President's salary what was, if you can just remind us, the income reported from investments and other nonsalary sources on the '93 tax return? Because here we only get a range, but there it was a very specific --
SENIOR ADMINISTRATION OFFICIAL: His total adjusted gross income was $293,757, of which $189,167 was his salary. So that difference would be the investment -- but that also included approximately $38,000 in moving expenses, which was reported as income. So that's really -- that was also offset by a deduction --
SENIOR ADMINISTRATION OFFICIAL: Any more questions on Schedule B?
Q Yes. On Value Partners, from page 11 through page 19, there are quite a few purchases before this thing was dumped into a blind trust of medical or health care firms. Two questions on that. Why did the Clintons wait until July to create the blind trust? And number two, do you see any problem with Value Partners investing in health care firms before the blind trust?
SENIOR ADMINISTRATION OFFICIAL: On number two first, the Office of Government Ethics has given a ruling on that --
SENIOR ADMINISTRATION OFFICIAL: That's correct. The Office of Government Ethics has looked at the question of the Value Partners investment as it affects the First Lady and concluded that there was no conflict of interest or even appearance of conflict of interest in the holding of the Value Partners investments up to the point that it was placed into the blind trust.
Q And because?
SENIOR ADMINISTRATION OFFICIAL: This is because -- there's several sort of steps you have to go through. Let me see if I can take you through them, though I may miss some, and if somebody else here can jog me if I do.
First of all, the Office of Government Ethics made the assumption but clearly did not concede and said it was not conceding that the conflict of interest laws would apply to the First Lady -- said, we're not deciding that at all. But assuming they did --that's the question for people -- assuming they did, would we have a violation of the criminal conflict of interest laws or the standards of ethical conduct for someone who was subject to the conflict of interest laws. Then the main conflict of interest law is 18 U.S.C. 208, which provides that a government official should not take any personal and -- should not participate personally and substantially in a particular matter in which that official has a financial interest.
Now, there are several important elements here. The most important, however, is that a particular matter is in fact that the statutory term that has a specific meaning, which is that it must be a matter that is focused on the interest of a discreet and identifiable class of persons. And health care reform is not a particular matter. It is a matter that affects everyone in the country at one level or another. It affects them differently, but it is a broad policy initiative directed at almost everyone's interest, rather than being focused more narrowly on a discreet and identifiable set of individuals or sector. And therefore, OGE says that health care was not and is not a particular matter for purposes of the conflict of interest laws.
Q When did they make that decision?
SENIOR ADMINISTRATION OFFICIAL: Well, they issued a letter --
SENIOR ADMINISTRATION OFFICIAL: May 3rd.
SENIOR ADMINISTRATION OFFICIAL: They issued a letter May 3rd. They had earlier given some guidance and suggested this specific conclusion, but didn't give us the specific --
Q May 3rd '94?
SENIOR ADMINISTRATION OFFICIAL: Yes.
Q So under the OGE ruling, the First Lady, if she wanted -- obviously, this has been happening -- could dump -- sell pharmaceutical stocks on day one and then on day two go out and do something that she knows is going to depress the price of pharmaceutical stocks or bash pharmaceutical companies. And anything she did related to health care, or any actions the administration took related to health care, simply wouldn't be affected by her financial dealings because it's too broad a subject matter?
SENIOR ADMINISTRATION OFFICIAL: It would not be a violation of the conflict of interest.
Q Can I get a copy of that letter?
SENIOR ADMINISTRATION OFFICIAL: Sure, we can release those in the bins.
Q And the first question, as a practical matter, could the Clintons have created the blind trust on January 20th of last year? In other words, why July? I still haven't gotten an answer.
SENIOR ADMINISTRATION OFFICIAL: Why July? Well, I mean, first of all, there's no legal requirement for the President to form a blind trust. This was at their election to do that. And it was a judgement they made in their first months here.
And what was magical about July? That's when it was completed. I don't know when a decision was made to do that.
SENIOR ADMINISTRATION OFFICIAL: And remember, it involves the selection of a trustee, the drafting of a trust document, the identification of the assets you're going to turn over.
Q Who had solicited the opinion that brought the OGE ruling?
SENIOR ADMINISTRATION OFFICIAL: OGE -- to members of Congress. They had requested that the Office of Government Ethics look at these.
SENIOR ADMINISTRATION OFFICIAL: And Mr. Potts, who is the head of the Office of Government Ethics, who signed this letter is a five-year term appointee, and was appointed by President Bush.
Q Which members of Congress wanted to know?
SENIOR ADMINISTRATION OFFICIAL: I think Christopher Cox. We'll provide the letter.
SENIOR ADMINISTRATION OFFICIAL: It's addressed to several congressmen.
Q Could you provide any details at all as to how, under this arrangement where there are the three separate accounts -- how a vast majority of the assets fall to Mrs. Clinton? I mean, is this a result of the original $100,000 earned that she continued to reinvest that and that was in her name? Or do you have any details that could flesh that out?
SENIOR ADMINISTRATION OFFICIAL: I don't know whether we have any details to furnish you. But remember, for the previous 10 or more years, she was a practicing lawyer in a substantial law firm, earning a substantial income. And he was the governor of a state which pays a very low salary to its governor.
Q So the fact of the matter is that she just earned more money and was able to accumulate more assets than he --
SENIOR ADMINISTRATION OFFICIAL: That's right.
Q Is there any tax advantage to keeping those separate? What would be the reason for keeping --
SENIOR ADMINISTRATION OFFICIAL: Not for tax purposes.
SENIOR ADMINISTRATION OFFICIAL: They filed a joint return.
SENIOR ADMINISTRATION OFFICIAL: And part of the trust assets consist of her retirement plans, which she had from her law firm.
Q Oh, I see, so that's -- whereas it did not include his retirement from the state service.
SENIOR ADMINISTRATION OFFICIAL: People ready for Schedule C?
Q Wait. I didn't do this story last year, and this may have been answered. But I'm a little unclear on this. Do they not pool their resources? You're saying that she made more money in the law firm than he made as the governor. But also, she lived in the mansion because he was the governor and had free transportation because he was the governor. All of his salary as governor obviously wasn't going into this, or he'd have a larger trust fund.
SENIOR ADMINISTRATION OFFICIAL: Some of you, I assume, are married. (Laughter.) Probably each of you has a different arrangement with his wife as to whether you have joint funds or separate funds, or who pays for what -- it varies by family.
Q That may be part of my problem answering this question, because I don't know -- I've never asked -- all of my stuff is in the two names. That's why this is unfamiliar to me. And if it's common to do it this way, I'll accept that. But the explanation of why she's gotten very rich and he's stayed the same -- is his salary now at $200,000? Is it all going to go into his blind trust and she's not -- and the next 10 years now he'll catch up? I mean, what's going to happen?
SENIOR ADMINISTRATION OFFICIAL: My parents were celebrating their 50th wedding anniversary this summer, and who have always had separate accounts for everything. So, I mean, I just think there are -- I think my colleague is right, people do it differently.
Q His salary does not go into the blind trust?
SENIOR ADMINISTRATION OFFICIAL: Any other kind of family questions -- (laughter) --
Q A Schedule B question, on the gifts. What's the limit for --
SENIOR ADMINISTRATION OFFICIAL: Oh, gifts. Filers are required to report gifts from one source that are valued in excess of $250. There are approximately $11,000 in gifts reported on the President's report here. And the gifts are from friends of the First Family.
Q And the gift office does the valuation?
SENIOR ADMINISTRATION OFFICIAL: The gift office is in charge of that.
SENIOR ADMINISTRATION OFFICIAL: Right. The gifts from a foreign government are separately and they are the property of the --
Q What did you say the total was?
SENIOR ADMINISTRATION OFFICIAL: Eleven thousand dollars.
Q Does this count as income --
SENIOR ADMINISTRATION OFFICIAL: No, a gift does not. Gift does not --
Q can buy gifts from that -- gift of a foreign leader but becomes the property of the government; but if the President wants to buy it, he's entitled to. Is that still the case?
SENIOR ADMINISTRATION OFFICIAL: Yes.
Q And has President Clinton opted to do that in any case to your knowledge?
SENIOR ADMINISTRATION OFFICIAL: Not to my knowledge. My understanding is they may keep gifts from foreign officials if the value of the gift is less than $225.
Q And if it exceeds that, they can buy it from the government.
SENIOR ADMINISTRATION OFFICIAL: If a gift exceeds that, it's accepted on behalf of the United States government and becomes property of the United States government.
Q Is there no longer a provision for buying it?
SENIOR ADMINISTRATION OFFICIAL: I don't know, but I -- it's certainly been true in the past, that you can buy something.
Q Listed here as donors of gifts were, among others, Tom Hanks and Carly Simon. Are they close personal friends?
SENIOR ADMINISTRATION OFFICIAL: I'm stunned you'd pick those two out. (Laughter.)
Q Who's Go-Go?
SENIOR ADMINISTRATION OFFICIAL: Go-go?
Q I wondered if you know roughly what the President has spent on legal fees --
SENIOR ADMINISTRATION OFFICIAL: I don't know myself, but the legal bills are certainly running --
SENIOR ADMINISTRATION OFFICIAL: And this is calendar year 1993.
Q And I understand you were asked to report on the possibility of setting up an account.
SENIOR ADMINISTRATION OFFICIAL: No, I have not reported yet. And it remains to be seen, a, whether such a fund will be set up or, if so, on what terms and conditions.
Q Do you think there's any legal barrier to that?
SENIOR ADMINISTRATION OFFICIAL: No.
SENIOR ADMINISTRATION OFFICIAL: Anything else on gifts?
Q Yes. What about the $525 worth of athletic shoes?
Q A good pair of New Balance shoes would go for like $125.
Q If the President were not keeping current on legal bills, then it would be reported as a liability -- is that right?
SENIOR ADMINISTRATION OFFICIAL: If at year-end you had a bill you hadn't paid, that would be listed as a liability.
SENIOR ADMINISTRATION OFFICIAL: In excess of $10,000.
Q If a legal defense fund does come to pass, will the President pay taxes on the proceeds?
SENIOR ADMINISTRATION OFFICIAL: -- my understanding is, it can be set up in a way in which the contributions into the funds are gifts. So they would not be income to the President.
Q Again, on Value Partners, just to get it clear, that no one here at this table knows who runs Value Partners, what institution or what person?
SENIOR ADMINISTRATION OFFICIAL: -- Little Rock, Arkansas.
Q And there's no way to know if that's been sold?
SENIOR ADMINISTRATION OFFICIAL: Well, it may be we can find out if it's been sold. I don't think anyone here knows.
Q If you could take that question.
Q Forgive me if I'm a little bit dense of the subject of blind trusts. I don't understand a blind trust in which you deposit assets that you already know about. I thought the idea was that you were supposed to put things in there and you don't know what's in the trust so whatever actually you keep as a public official can't be considered conflict of interest.
SENIOR ADMINISTRATION OFFICIAL: Over time, you don't, you will not know what's in the trust. The trustee receives your identified assets and has the power to sell them, reinvest, do whatever he wants. When he sells, until he sells, you still have whatever conflict arises out of your ownership of what you put into the blind trust.
After he sells, he doesn't tell you what he put the money into. You get rid of whatever conflict you had for what was sold, and you have no conflict as to what he reinvested it into because you don't know what it is.
Q So, in other words, this blind trust the Clintons have now is only a blind trust to the extent that assets they deposited in it have been sold.
SENIOR ADMINISTRATION OFFICIAL: It's what's called under the statutes a blind trust, but he does not get rid of his conflicts with respect to what he or she have put into it unless and until he is notified that that asset has been sold.
Q? to make an effort to sell it.
SENIOR ADMINISTRATION OFFICIAL: It's up to the trustee.
SENIOR ADMINISTRATION OFFICIAL: When an asset is placed, when the trust is certified by the Office of Government Ethics, the Office of Government Ethics would use the list of assets going into a trust and will be require divestiture of assets that are clearly known conflicts at the time the trust is established.
So what you're talking about is assets that might create a conflict later but -- at the time you created the trust. Those assets would continue to provide or give you a conflict problem until they're divested. But assets that go into the trust, you don't expect will create a conflict.
Q Any divestitures on this -- did that happen in any case?
Q Did they divest themselves going in on anything that was declared to be a conflict?
SENIOR ADMINISTRATION OFFICIAL: As you can see from the transactions, they did divest some assets. But I'm not aware that they were -- at the direction and request of the Office of Government Ethics.
Q? So we're looking at this list and Motorola's here. And the President went and got Motorola of Japan -- we don't know from this list whether he divested himself of that conflict. Right?
SENIOR ADMINISTRATION OFFICIAL: Well, the list you're looking at is a list of the transactions before the assets going into the trust or Value Partners themselves. --
Q? So this isn't perfect. It doesn't say that -- divested as a part of the trust. Correct? So we don't know whether that's still a conflict.
SENIOR ADMINISTRATION OFFICIAL: The only thing that became part of the trust was Mrs. Clinton's partnership futures in Value Partners. And this is a historical list covering the first seven months or the first six months of 1993. That list provides no indication of what particular securities at the present time or after the dates reflected there were still being held by Value Partners. So even today, if Mrs. Clinton still were holding Value Partners outside the blind trust, that list would provide no indication what particular securities are monthly being traded by that partnership.
Q Something else they don't know is whether the trust has in fact sold Value Partners. Is that correct?
SENIOR ADMINISTRATION OFFICIAL: I don't think we know --
Q? Well, I know. But the Value Partners people would know. And do they report transactions from time to time to the holders of shares?
SENIOR ADMINISTRATION OFFICIAL: During 1993 and 1993 there were no reports of any particular, relating to particular securities to the limited partners like Mrs. Clinton -- I think one exception in early 1992.
SENIOR ADMINISTRATION OFFICIAL: No reports to the Clintons. But am I correct that this list we've supplied you of the transactions inside Value Partners in the first six and half months of '93 was obtained really by the people preparing this report. Of course, they were required to show on the report the, all of the transactions up to the time that the blind trust was created. But it's highly likely none of these were known to the Clintons.
Q? Do you know who Alan Houser is who gave this sculpture? You don't know if he's a sculptor?
SENIOR ADMINISTRATION OFFICIAL: I don't know.
Liabilities. Any questions on Schedule C? This --notes in the former required report any liabilities Schedule C. As it notes in the former required report, any liabilities that exceed $10,000, not including a mortgage on a personal residence or personal property. The Clintons had no reported liabilities for 1993.
Agreements or arrangements -- the President reported his continuing interest in the Arkansas State Employees Retirement system. That's noted there.
In Schedule D, outside position, the President held no outside positions during the reporting period.
Q That pension in part two of Schedule C -- do we know how much he would stand to get in pension? Is he now drawing a pension? Does that start at age 65 and how much is that going to be? Do we know anything about that?
SENIOR ADMINISTRATION OFFICIAL: He's not currently drawing it.
SENIOR ADMINISTRATION OFFICIAL: Any other questions?
Q Yes. On this liabilities in Schedule C, there's this rental property in Delaware. Am I looking at the right thing?
SENIOR ADMINISTRATION OFFICIAL: That's an example. That's just a guide to -- (laughter.)
Q I hear that. (Laughter.)
SENIOR ADMINISTRATION OFFICIAL: This was a trick question.
SENIOR ADMINISTRATION OFFICIAL: And that's John-John.
SENIOR ADMINISTRATION OFFICIAL: And let me make it clear, the National Association of Rock Collectors -- part two, gifts -- the President did not receive -- (laughter) -- the leather briefcase for a retiring President, that's an example on this one. (Laughter.)
Q This is all senior administration official?
SENIOR ADMINISTRATION OFFICIAL: Yes. The cover statement by Mr. Cutler is indeed by Mr. Cutler.
SENIOR ADMINISTRATION OFFICIAL: On the record.
Q Does that include the unrelated questions about the legal defense fund?
SENIOR ADMINISTRATION OFFICIAL: Yes.
THE PRESS: Thank you.
END5:08 P.M. EDT