Leach Urges Keeping Focus in Whitewater : Inquiry: GOP’s chief critic of Clinton in controversy says too much is made of White House aides’ phone calls. He says their anger was ‘natural.’

The leading Republican critic of President Clinton’s involvement in the Whitewater controversy Sunday said the angry White House reaction to the appointment of a partisan Republican to investigate civil cases for the Resolution Trust Corp. was “pretty natural” and too much should not be made of it.

Rep. Jim Leach (R-Iowa) said it would be “premature to draw any extraordinary conclusions” about a phone call senior White House adviser George Stephanopoulos made in February to Joshua Steiner, chief of staff at the Treasury Department.

Sources have described Stephanopoulos as angrily asking Steiner how the RTC came to name former federal prosecutor Jay B. Stephens to investigate possible civil cases against Madison Guaranty Savings & Loan and whether that hiring could be reversed.

Stephens, a former Republican U.S. attorney for the District of Columbia, was sharply critical of Clinton when the President fired him as part of the removal of all the U.S. attorneys who were appointed by the George Bush Administration.

Stephens has also considered running for political office.

He was hired by the RTC in early February, and among the cases the agency is examining for a possible civil action is the Rose Law Firm’s representation of Madison Guaranty before Arkansas regulators.

Hillary Rodham Clinton, then a partner at the firm and a partner in the Whitewater Land Development Corp. with her then-governor husband and James B. McDougal, who owned Madison Guaranty, asserted to the state regulators that the thrift was on the road to financial health.

It later collapsed, requiring a taxpayer bailout of at least $47 million.

Leach, the senior Republican on the House Banking Committee who is leading the GOP charge on Whitewater, told NBC-TV’s “Meet the Press” on Sunday that the Stephanopoulos phone call “may have been a mistake” but he added: “I hope we don’t make too much of this part of the story.”

Instead, Leach pressed for a full congressional investigation of the relationship between Madison Guaranty and Whitewater Development.

Leach has maintained that Whitewater Development and Madison Guaranty were so intertwined that the Clintons ended up with financial benefits from the S&L; even as it was collapsing and their Whitewater project was failing.

The President maintains that he lost about $46,000 on the Whitewater endeavor.

During the TV interview, Leach adhered to his previous assessment that the Whitewater case is not about impeachment and should not be about criminal charges against the Clintons. “If there are breaks of the law, it should be understood there are civil remedies and criminal remedies,” he said, “In this case, I would strongly recommend a civil route.”