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01/29/98- Updated 05:52 PM ET

Babbitt blasts charges on casino decision

WASHINGTON - A combative Interior Secretary Bruce Babbitt complained Thursday his reputation had been unfairly tarnished by half-baked allegations about political influence in the rejection of an Indian gambling casino.

"You can manufacture all the conspiracy theories you want, but at the end of the day, the facts are the facts," he declared angrily.

Babbitt insisted the decision blocking plans by three Indian tribes to build a casino at a money-losing Wisconsin dog track in 1995 was made by career Interior Department officials and reflected strong local opposition to a casino.

The decision has embroiled Babbitt in a heated controversy over political contributions and whether the White House and Democratic Party tried to influence the outcome of the casino decision at the behest of a group of tribes that contributed $286,000 to the party.

Babbitt vehemently denied that campaign contributions - or any influence by the White House - played a role in rejection of the Indian casino in Hudson, Wis.

"I never communicated with anyone at the White House or the Democratic National Committee" about the decision, Babbitt told the House Government Reform and Oversight Committee, which is looking into the matter as part of a broader investigation of campaign fund raising.

But he acknowledged that the casino issue attracted intense lobbying on both sides.

"There were all kinds of people floating around," he said. While the casino idea was being characterized as the work of three poor Indian tribes, Florida gambling interests backing the proposal were as "big, determined and scuzzy as the guys on the other side."

But he said the lobbying had no bearing on the final decision.

The final witness in four days of hearings, Babbitt launched an emotional defense of his actions in connection with the casino decision, saying the issue threatens to unfairly tarnish his 23-year career in public service.

But Rep. Dan Burton, R-Ind., the committee chairman, said he saw ample evidence of possible criminal wrongdoing.

"There certainly is enough question that the American people ought to demand a thorough investigation by the Justice Department or an independent counsel," said Burton. He cited testimony by lobbyists and internal memos - both from the Interior Department and White House - that, he asserted, hint at likely political influence.

"The tribes that couldn't afford to give anything to the ... (Democratic Party) were completely shut out of the process," insisted Burton.

Babbitt called Burton's characterizations "oblivious to the facts" that had been presented. The decision, by career employees, "was the right decision," he said. "It was made the right way, it was made for the right reason."

Democrats on the committee repeatedly came to Babbitt's defense. Rep. Henry Waxman, D-Calif., said having a special prosecutor pursue the matter would be "a travesty."

The Justice Department is expected within the next few weeks to decide whether a special prosecutor should be named to investigate whether Babbitt has made false statements to Congress in connection with the casino matter.

Babbitt, testifying for nearly six hours, sought at the outset to go on the offensive. He has acknowledged to friends disappointment over what had been seen as a timid and somewhat ineffective explanation at Senate hearings last fall on his role in the casino case.

This time, Babbitt said before Thursday's hearing, "I'm prepared."

"The attacks on my integrity are uncalled for and unwarranted," he told the committee. "I deeply resent it. I've been tarnished by a controversy manufactured by the losers" in the casino bid.

Critics have focused on a key meeting the day the decision was made - meeting Babbitt had with a longtime friend, former law partner and college classmate, who at the time had been hired by proponents of the casino.

The lobbyist, Paul Eckstein, has testified Babbitt told him that Harold Ickes, deputy White House chief of staff, had put pressure on him to have the issue resolved, and that during the meeting Babbitt had mentioned that the tribes opposing the deal had made substantial campaign contributions.

Babbitt has admitted telling Eckstein that Ickes had wanted the decision made promptly, but insists he invoked Ickes' name "to end the meeting" and get his longtime friend out of the office.

"It was a mistake to invoke Harold Ickes' name," Babbitt told the committee. "The fact is I never spoke to Mr. Ickes about the Hudson matter. ... Unfortunately I made up an excuse."

As to Eckstein's claim that Babbitt raised the issue of campaign contributions, Babbitt said he had no recollection of such a discussion.

By The Associated Press

Copyright 1998 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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