TRANSCRIPT OF WHITEWATER INTERVIEW

Koppel: Pretend that you've got a grandchild on your knee, a relatively intelligent 12- or 13-year old as this is kind of a complicated story. And see if you can reduce this story to its essence. Make it nice and simple so we can all understand it.

McDougal: Okay. I found this pretty piece of land up in north Arkansas up on the White River, and I thought I'd like to buy it. It occurred to me I might like to share the ownership with a partner, which I often did. I went ahead and arranged the financing. And it occurred to me to approach this young couple, Bill and Hillary Clinton, to be my partners in it with my wife and I. I did. They signed on the mortgage as did our side of the family, and we made the purchase. Spent a lot of money, didn't make any money. Been a headache ever since.

Koppel: That's it?

McDougal: That's it.

Koppel: Now, of course, it turned out, didn't it, that this young man and young woman that you lent the money to or whom you brought into this deal ended up becoming initially governor of the state of Arkansas? In fact, he was running for governor of the state of Arkansas at that time, wasn't he?

McDougal: Probably was. I don't recall precisely.

Koppel: Well, he was. Let me reassure you because I've checked into it. But you're telling me that's not something that would have occurred to you at the time?

McDougal: It would have been no interest to me one way or the other.

Koppel: Why not? You've placed the stress on the word political in your relationship before.

McDougal: Right.

Koppel: So a political man with a political background who moved in political circles would not have been aware of the fact that he was lending or bringing into this land deal a man who by all odds was going to be in just a few months the next governor of Arkansas?

McDougal: Oh sure, I was entirely aware of it. It wasn't the deciding factor.

Koppel: Why not?

McDougal: Why should it have been? There was absolutely nothing the governor of Arkansas could have done for me. I didn't own a bank, a savings and loan, an insurance company or any other regulated business.

Koppel: Well, you realize that the world is filled of cynics, and I guess you're talking to one of them. And just from a cynical point of view, I would say if I were a land developer in the state of Arkansas, if I were a sometime banker in the state of Arkansas, if I was doing business in the state of Arkansas, that having the governor and his wife indebted to me in a fashion that apparently involved about $175,00, that certainly wasn't going to hurt me, was it?

McDougal: I never said it hurt me.

Koppel: But you're just suggesting that it never occurred to you to do something for that reason?

McDougal: That's right.

Koppel: You were doing it simply because, what?

McDougal: They were friends, they were agreeable people, I liked them. I thought they might be particularly interested in this piece of hill property. So I approached them.

Koppel: Why was it necessary, since the deal on paper was a 50-50 deal, why was it necessary that you carry a disproportionate burden? I mean, that has the potential of putting the governor in an awkward position, doesn't it?

McDougal: I don't follow that.

Koppel: Well, if he's getting, if he's making an investment for more money than he's got, unless of course, the investment turns around, makes a lot of money for him quickly, then he's in debt, albeit to a friend, but he's in debt to someone who might at some point in the future come back and say you owe me. I mean, that's the very definition of a sweetheart deal.

McDougal: That's the definition of a friendship deal.

Koppel: No. It's the definition of a sweetheart deal. If someone comes to me and says, Ted, I tell you what, I just like you a lot, let's buy $200,000 worth of property here but you don't have to put up your share because I'll do that for you. It might an be act of friendship, but it is also a sweetheart deal. Certainly, I'd love to get that kind of a deal if I could do it without affecting my reputation. My question is, when you were talking to the Clintons, did that subject ever come up?

McDougal: Of course, not initially, because the idea was the project would generate its own capital as we began sales, and it wouldn't be necessary to put up any additional money. That had been my experience on many projects. They knew that, I knew that, the bankers knew that.

Koppel: I'll tell you what, Mr. McDougal, we need to take a break. But when we come back I'd like to ask you, when it came to doing business, which of the two Clintons really did the business?

McDougal: Okay.

-- commercial break --

Koppel: Mr. McDougal, before the break, you told me the notion of the sweetheart deal certainly didn't come up initially. Did it ever come up?

McDougal: No.

Koppel: No one ever raised it?

McDougal: In a sweetheart deal as I understand it, there's a quid pro quo. You say I'll do this for you if you'll do that for me. That never came up.

Koppel: When you were talking to the Clintons about it, you told my colleague that when you discussed details of the deal later on, that Bill Clinton's eyes sort of glazed over, that he was bored with that kind of discussion.

McDougal: That's right.

Koppel: You left the impression that if anyone was talking business, it was Hillary Clinton.

McDougal: That's correct.

Koppel: Tell me about that.

McDougal: Well, occasionally certain housekeeping things had to be discussed -- like the payment of the real property taxes, or, the minutia of running a business. Thing like that would come up, which I needed to consult her on -- which were quite infrequently, maybe once or twice a year. But if there was any business to discuss I discussed it with Mrs. Clinton and not with the governor

Koppel: And what kind of business woman did you find her to be?

McDougal: I found her to be astute.

Koppel: Is there any doubt in your mind that she understood the details of what was going on?

McDougal: Oh, none, whatsoever. She is a brilliant person.

Koppel: When now there is all this confusion with you claiming that the Clintons put in no more than $13,500 and they're claiming that in one form or another they put in $68,900. Could that be the result of confusion?

McDougal: Oh, I think it could. I think I could be entirely wrong, as I've told you before. But I've tried and tried and tried, Ted, and that's the only amount that I can come up with.

Koppel: Where are all the papers? I mean, somehow there must be files, there must be documents, there must be paperwork that could resolve once and for all where the truth lies?

McDougal: Yes. Well, I'm the owner of those papers, but they have not yet been delivered. I understand they are at the White House and they are in the hands of the special prosecutors, copies are, or vice versa.

Koppel: Now when you say you're the owner of those papers, maybe you could just explain.

McDougal: Sure, I bought out the Clintons' interest last year, or year before, and a part of the agreement was they would turn over the company's records to me.

Koppel: And they've never done that?

McDougal: No, sir.

Koppel: Have you asked for them?

McDougal: Yes.

Koppel: You have said in the past that you'd be willing to take a lie detector test to the effect that Bill Clinton did nothing illegal.

McDougal: Uh, I will take a lie detector test and answer this question, Do you have any knowledge of anything Bill Clinton has ever done which is illegal, immoral, dishonest, or unethical. And my answer would be, no, and I would pass the test.

Koppel: Now, if, if, the questions were expanded to include one more question, and I raise it only because there's an obvious void there. Let's apply all those same tests to Mrs. Clinton, would you give the same answer?

McDougal: (pause) I don't Mrs. Clinton well enough to give that broad a guarantee.

Koppel: Well, you realize that by not answering that question you raise a very serious question?

McDougal: Well, I think that, uh, (pause). Ask me another question about it.

Koppel: Well, I'd just as soon that, you were the one who drafted the first question, why don't you narrow it down until you feel comfortable with it?

McDougal: I think I have said previously that I couldn't answer that broad a question. If I were asked, Did I think Mrs. Clinton done anything illegal, I would answer no to that and expect to pass the test.

Koppel: Well, what about did she do anything immoral or dishonest?

McDougal: Well, I was making an across-the-board statement for the president.

Koppel: I understand.

McDougal: I mean, the day is born, okay?

Koppel: No, no, no, I got that, and the implication of it is very clear, I'm just trying to not leave any further ambiguity.

McDougal: I can't say with finality. Okay, with my limited knowledge, I have no knowledge, may I phrase it this way? I have no knowledge of anything illegal, immoral, dishonest, or unethical that Mrs. Clinton has ever done.

Koppel: But you are not as confident of her conduct with regard, I should add, to the Madison Bank affair, the Whitewater affair, in other words, what has generally come to be known as the Whitewater affair?

McDougal: (pause) Well, I think everybody understands that the president is absolutely blameless and I think there is some controversy about Mrs. Clinton's role. But in my mind there is no doubt she is completely innocent of having done anything illegal.

Koppel: Mr. McDougal, how do you think ultimately all these questions are going to be resolved?

McDougal: I don't know, it's really very helpful to the state, it's almost as good as another factory. We have several hundred news people here bringing income to the state. I hope it goes on forever. I don't think it will ever be resolved -- totally.

Koppel: Alright, Mr. McDougal, on that lamentable note, thank you very much. It was good of you to join us.