Jim Wright - Ethics Investigation and Resignation

Ethics Investigation and Resignation

In 1988 Wright became the target of an inquiry by the House Ethics Committee. Their report in early 1989 implied that he had used bulk purchases of his book, Reflections of a Public Man, to earn speaking fees in excess of the allowed maximum, and that his wife, Betty, was given a job and perks to avoid the limit on gifts. Faced with an increasing loss of effectiveness, Wright tendered his resignation as Speaker on May 31, 1989, the resignation to become effective on the selection of a successor. He was the first Speaker to resign because of a scandal. On June 6, the Democratic Caucus brought Wright's speakership to an end by selecting his replacement, Tom Foley of Washington, and on June 30 Wright resigned his seat in Congress.

The incident itself was controversial and was a part of the increasing partisan infighting that has plagued the Congress ever since. The original charges were filed by Newt Gingrich in 1988 and their effect propelled Gingrich's own career advancement to the Speaker's chair itself.

Michael Parenti, critic of the national security state, attributed Wright's forced resignation to the critical questions he was raising in the late 1980s with regard to CIA covert actions in Nicaragua. Wright had not only criticized Reagan's policy, but taken the extremely unusual step of entering into negotiations with the Nicaraguan government as speaker.

William K. Black claims that Wright's interventions in the Savings and Loan (S&L) crisis "were decisive in forcing him to resign in disgrace from the House". Black wrote that Wright had been saved from financial ruin and elevated to Speaker of the House by massive campaign contributions from control frauds like Charles Keating. The control frauds managed to get hundreds of executives of S&Ls, many legitimate, to talk with their representatives in the US congress to delay effective governmental action against the frauds. This action only increased (a) the billions of dollars their ultimate failures cost the US taxpayers and (b) the magnitude of the resulting scandal. The scandal robbed Wright's Democratic party of the "sleaze factor" issue in the 1988 presidential election, thereby handing the election to the Republican George H. W. Bush, according to Black. He resigned to avoid the official documentation of his role in this that would almost certainly have come from hearings by the United States House Committee on Ethics, as it did for the Keating Five.

The charges filed against Wright did not mention Nicaragua. A report by special counsel implicated him in a number of influence peddling charges, such as Vernon Savings and Loan, and attempting to get William K. Black fired as the deputy director of the Federal Savings and Loan Insurance Corporation (FSLIC) under Gray. However, the charges against him concluded that, "while the Congressman's dealings with representatives of the Federal Home Loan Bank Board may have been intemperate, the committee was not persuaded that there is reason to believe that he exercised undue influence in his dealings with that agency."