It's Lonely at the Top

By Ed Magnuson

As wave after wave of scandal has battered Attorney General Edwin Meese and eroded the credibility of his Justice Department, he has clung for months to the time-honored defense of officials in trouble: the accusations were politically motivated. But last week, in a series of dramatic confrontations, that defense crumbled.

First, Meese was bluntly told by William Weld, chief of the Justice Department's criminal division, that he might be subject to indictment for his dealings with E. Robert Wallach, a central figure in both the Wedtech and Iraqi pipeline affairs. Weld and Deputy Attorney General Arnold Burns, the second in command, warned Meese that his behavior was "poisoning the department." Then the two officials, handpicked by Meese for their senior posts, publicly announced their resignations and those of four of their closest advisers.

The next day Solicitor General Charles Fried personally urged Meese to resign. Finally, Strom Thurmond, one of the Senate's most conservative Republicans, marched into the Attorney General's office to express the "deep concern" of his Capitol Hill colleagues about the example Meese was setting as the nation's top law-enforcement officer.

Despite the onslaught, Ronald Reagan once again stubbornly expressed his "full confidence in my friend of 20 years." Meese blithely insisted that he had no intention of quitting. He was helped by a terse announcement from Independent Counsel James McKay that his probe of Meese's ties to Wedtech and the pipeline had turned up insufficient evidence to indict the Attorney General.

While Meese insisted that the "department is functioning in its normal fashion" and "our strong management team is on the job," morale below him was sagging. There was so much grumbling in the Justice Department that a special custodial team was assigned to erase scornful graffiti from the bathrooms and walls. Three of the top leadership posts are vacant. (Assistant Attorney General Stephen Trott has also resigned, to take a federal judgeship.)

When Weld recently urged U.S. Attorneys to get tougher on corruption, he ran into cynical replies. Says a Justice official: "Their reaction was to laugh and say, 'What about your boss? Why don't you start at the Attorney General level?' "

In defending Meese on the basis of friendship, the President implied that his personal relationship with the Attorney General took precedence over the integrity and effectiveness of the Justice Department. Other Republicans were more concerned. Some members of Reagan's White House staff have quietly supported the pressure on Meese to step aside. Instead of criticizing the abrupt departure of Weld and Burns, they praised it, in the words of one adviser, as an "act of principle."

When Burns and Weld told Meese they were quitting, sources say, Meese at first laughed. "Is this a joke?" he asked. "No, Ed, this is no joke," they replied. Asked Meese: "Why are you doing this?" Burns said that Meese had an "appearance problem" that was hurting the department. Both men declared that in good conscience they could not remain.

Weld explained that if he were investigating Meese's relations with Wallach, "I'd put it to the grand jury for indictment." Meese protested, "But I haven't done anything wrong." Weld persisted, claiming that Wallach, Meese's former personal attorney, had traded his influence with Meese for big money. "Yes, but Wallach was indicted," Meese replied. Said Weld: "I'm not talking about Wallach. I'm talking about you."

Weld contended that there appeared to be a pattern of Meese in effect selling the services of his office. Even if Independent Counsel McKay decides not to indict him, Weld advised Meese, "the best-case scenario is, you are going to get a report from McKay that knocks your block off."

Weld predicted that McKay will charge that Meese violated the "Standards of Ethical Conduct for Government Officers and Employees," an ethics code that carries no criminal penalties but would require action by the department's Office of Professional Responsibility. The shaken Meese tried to persuade the two not to do anything "hotheaded." They said their resignations had already been handed to White House Chief of Staff Howard Baker.

. The route to the resignations had been long and difficult. Weld, a wealthy Boston intellectual, joined the Justice Department in 1986 after compiling an impressive record as U.S. Attorney in Massachusetts. There he won 108 convictions out of 111 cases of public corruption that his office prosecuted. His difficulties with Meese began last May, as he reviewed allegations against Meese to determine whether they required investigation by a special prosecutor. Weld consulted his superior, Burns, an affable former New York corporate lawyer who, as Meese's top aide, supervised the daily workings of the department bureaucracy.

Both men decided, without telling Meese, that the Attorney General should be investigated by Independent Counsel McKay, who was probing former White House Political Adviser Lyn Nofziger's lobbying for New York City's scandal-tarred Wedtech Corp. As White House Counsellor in 1982, Meese helped Wedtech get what he called a "fair hearing" in landing a $32 million Army contract. A rare White House meeting to facilitate the contract had been held in the office of a top Meese aide, James Jenkins.

When someone tipped Meese to his subordinates' decision, he reportedly was angry. "Ed Meese didn't want it to go to the independent counsel," says a department insider. "He made it known to Weld that it shouldn't go anywhere; it should be killed." On May 11, apparently aware that he could not block the probe, Meese pre-empted the impending announcement by publicly inviting McKay to look into his dealings with Wedtech.

As further allegations against Meese surfaced, Burns and Weld became more concerned. At senior staff meetings, they confronted Meese directly, citing newspaper stories and asking, "What about this, Ed? And this?" Meese still shrugged the reports off as "partisan attacks." Both officials had expected McKay to wind up his investigations quickly, but as the probe broadened instead, they decided that someone had to do something. Said a White House source: "They had endured the situation as long as they could, but there appeared to be no end in sight."

Last month the two officials opened a channel of communication with White House Counsel A.B. Culvahouse to urge that Meese be persuaded to quit. Culvahouse arranged a meeting for them with Chief of Staff Baker on March 16. The White House version of Baker's response is that "he respected their views but couldn't offer much encouragement." He explained that Reagan simply would < not consider pushing Meese out.

Over the weekend of March 26-27, Burns and Weld decided to resign, and they told Culvahouse and Baker on Monday. The chief of staff informed Reagan. Curiously, neither the White House aides nor Reagan told Meese.

After the resignations, speculation quickly shifted to whether Solicitor General Charles Fried would quit too. Fried, who represents the Government before the Supreme Court, sought the advice of Retired Supreme Court Justice Lewis F. Powell. The 80-year-old Powell described Fried as "very upset and concerned." When Meese urged Fried to stay on the job, the anguished official declined to give a flat promise to do so. Instead, he told Meese that the turmoil in the department would not end until Meese stepped aside.

Later Fried announced vaguely that he would remain as long as he is "able to lead the office of Solicitor General with integrity and effectiveness." He made it clear that he would not accept promotion to any of the higher vacancies.

At the heart of Meese's troubles was his friendship with Wallach, who advised Meese during his difficult Senate confirmation as Attorney General in 1985. The wheeler-dealer lawyer had financial interests in both Wedtech and the proposed Iraqi oil pipeline that Meese tried to expedite. Wallach was indicted by a federal grand jury in New York City last December for illegally acquiring payments from Wedtech to influence Meese.

Weld is known to have been particularly concerned about a report that Swiss Financier Bruce Rappaport paid Wallach $150,000 for helping promote the Iraqi pipeline. Senate investigators traced some of that money to an investment account that also held $52,000 of personal savings by Meese. This commingled fund was managed by a Wedtech director, W. Franklyn Chinn, whom Wallach had introduced to Meese. At times Chinn bought more stock in Meese's name than Meese's investment could pay for, and the deals produced a profit of $40,000 for the Attorney General. The arrangement, according to a Justice official, could be seen as an indirect payoff to Meese.

Wallach and Chinn have taken their Fifth Amendment protection against self- incrimination rather than cooperate with McKay in the Meese probe. For his part, Meese contends he knew nothing about the details of the Chinn investments.

Buoyed by McKay's statement that he is not facing indictment, the Attorney General announced that he intends to fly off Wednesday on a scheduled week- long trip to Latin America to seek greater cooperation with U.S. antidrug programs. Yet Meese is not in the best position to pressure foreign leaders. When other U.S. officials have asked Mexico, for example, to get tougher on its officials accused of drug corruption, the response has been disconcerting. After citing Meese's problems, some Mexican diplomats have added with a sardonic smile, "It's like Wedtech. These cases are very difficult to make."

With reporting by Anne Constable and Elaine Shannon/Washington