DeLay on the Hot Seat

by Jack Newfield

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Two investigative bombs with long fuses are sizzling under Tom DeLay, America's Machiavelli of gerrymandering and shakedown fundraising. They both involve active grand juries investigating alleged money-laundering and campaign finance abuses. DeLay, House majority leader, is still laughing off these probes in public, but he has hired criminal attorneys and begun a defense fund.

The first bomb involves the Senate's Indian Affairs Committee, led by John McCain. It is scheduled to hold a hearing on September 29 into the alleged fleecing of Indian tribes by two of DeLay's closest allies, lobbyists Jack Abramoff and Mike Scanlon. They have been paid more than $45 million over three years by casino-owning tribes for services that remain unclear. Dissidents in these tribes, who have asked to testify, claim they were duped and that most tribal members were kept in the dark about these exorbitant fees. Roy Fletcher, spokesman for the Coushatta tribe of Louisiana's pro-casino faction, which retained Abramoff, says the tribe is investigating whether it got what it paid for.

But while the hearing may expose some wrongdoing, the more threatening aspect of the Washington probe involves the FBI and a federal grand jury that has been meeting for months. Federal prosecutors have assembled a war room full of banking and billing records as well as e-mails from Abramoff and Scanlon. They are focusing on the laundering of money for personal extravagances and political campaigns.

DeLay's name may not even come up much during the Senate testimony, but in Washington he is widely regarded as the enabler of these two avatars of avarice. DeLay has adroitly disavowed his two friends--a sign of how much The Hammer has to hide.

Last year, in introducing DeLay, Abramoff declared that Tom Delay is "who all of us want to be when we grow up." Now he is on his own going into the hearing--distanced by DeLay and kicked out of his law firm, Greenberg Traurig, for taking more than $10 million in payments from Scanlon and not telling the firm. As an example of how close the relationship once appeared to be, the law firm of Abramoff, a hard-line right-winger, was paid $7.9 million over six years by the US Protectorate of the Mariana Islands to keep the garment sweatshop haven exempt from US minimum-wage laws. When the Senate repealed the exemption, DeLay killed the repeal in the House. Abramoff, his former law firm and his Indian clients have donated more than $100,000 to DeLay's PACs since 2000. Scanlon was DeLay's press secretary during the Clinton impeachment and became Abramoff's protégé.

Abramoff and Scanlon enriched themselves with tribal funds meant for education, housing and healthcare, according to the Senate staffers and an independent audit of the Coushatta tribe. They also directed about $1.5 million into Republican campaigns from the eleven tribes they represented. Tribes that gave to Democrats in the 1990s started giving to the GOP once they hired Abramoff and Scanlon. The Agua Caliente tribe of California gave $100,000 to the Republican National Committee right after they hired Abramoff in 2002, while the Saginaw Chippewas of Michigan gave $18,000 to DeLay's PAC and the Tigua tribe of Texas gave $92,000 to GOP PACs after they hired Abramoff. Scanlon's consulting company donated $500,000 to the Republican Governors Association, funds that originated with the eleven tribes, who constituted 90 percent of Scanlon's business. Abramoff himself donated to twenty-three Republican campaigns, including those of six senators and twelve Congressmen, all right-wing favorites of DeLay, like Richard Pombo, Johnny Isakson and Ernest Istook.

A big question about the hearing is whether the committee will subpoena Ralph Reed, who is now running the Bush ground campaign in five Southern states. The anti-gambling Reed has been a stealth partner of Abramoff and Scanlon, getting paid at least $4 million through Scanlon's companies to block competing casinos from cutting into the profits of the existing Coushatta casino in Louisiana. I first reported these covert payments in the July 12 issue of The Nation. Reed denied them for two months but finally admitted getting this money, to Alabama's Montgomery Advertiser, after a federal grand jury subpoenaed all his financial records involving Abramoff, Scanlon and Indian gambling.

The second bomb is sizzling in Texas, where a grand jury has just indicted three close associates of DeLay on charges of violating a state law banning corporate funding of political activity. Democratic county prosecutor Ronnie Earle has been investigating DeLay's fundraising chicanery involving the PAC of Texans for a Republican Majority. The essence of the probe is that TRMPAC illegally contributed corporate money to elect fourteen GOP state legislators in 2002 to gain state legislative control for the first time in 130 years, and then used this majority to crudely gerrymander Texas Congressional districts so that four Democrats might lose their seats this November. DeLay, who was chairman of an advisory board for the Republican Majority group, claims the probe is driven by partisan politics.

Under Texas law, the $600,000 in corporate donations could be used only for the PAC's administrative costs, like rent. But instead it was used for polling, fundraising and phone banks, according to the PAC's own public filings. TRMPAC also wired the Republican National Committee $190,000 in corporate "soft money"; two weeks later the RNC mailed legal "hard money" checks to seven state GOP candidates totaling exactly $190,000. The RNC called this "a coincidence." Among the donors to TRMPAC was Abramoff's law firm at the time, Preston, Gates & Ellis, and two tribes associated with him, for a total of $31,000 in 2000.

Tom DeLay, driven by an alloy of ideology and money, will likely be the next Speaker of the House if the GOP remains in control. That is, if these bombs don't blow up in his face first.