From the Associated Press
Gramm: I never paid for Ryan's endorsement

November 17, 2005

BY MIKE ROBINSON ASSOCIATED PRESS

Former presidential hopeful Phil Gramm testified Thursday that he never approved thousands of dollars in consulting payments to George Ryan's daughters and staff in return for the former governor's endorsement and said his campaign would not have condoned it.

"It's sort of like the difference between love and prostitution," the folksy former Texas senator testified, drawing gasps and laughter from spectators at a hearing with jurors out of the room.

"You don't pay people to like you," Gramm testified.

Ryan, 71, and lobbyist friend Larry Warner, 67, are charged in a 22-count federal indictment with racketeering, mail fraud and other offenses. They deny any wrongdoing.

Ryan is accused of using state resources and employees to fuel his campaigns, starting in 1991 and including Gramm's race for the 1996 Republican presidential nomination.

Gramm dropped out of the race in February 1996.

"I concluded that it would be a waste of my time and my supporters' money," he said.

By that time, his campaign had paid thousands of dollars in fees to a Chicago-area consultant. The consultant in turn wrote checks to Ryan's daughters and two top Ryan aides.

U.S. District Judge Rebecca R. Pallmeyer stopped Gramm from testifying the first time Assistant U.S. Attorney Zachary T. Fardon asked him why he would not approve of such payments.

Jurors were ushered from the room and Fardon was then allowed to ask Gramm the question to see what his answer would be and whether it would be prejudicial to Ryan.

At that point he made his comment about love and prostitution.

Pallmeyer said that when jurors were brought back into the courtroom Fardon could ask Gramm a yes or no question about his reason for opposing such payments. Fardon also got permission to counsel Gramm not to say anything overly colorful once he got back on the witness stand.

"We're not going to have love and prostitution before the jury," Pallmeyer said.

But Gramm would not be limited to a yes or no answer when Fardon asked him whether paying for an endorsement would "dilute" the value of the endorsement.

"With friendship or support, it's not something that you buy," Gramm said with jurors now listening. He said that doing so "would dilute more than value of the endorsement-- it would dilute your character" and affect perceptions of "the kind of person you are."

Ryan, sitting at the defense table, showed no emotion at the testimony.

Ryan attorney Bradley E. Lerman sought to soften the impact of the testimony, suggesting that the money might have been for something other than an endorsement. Gramm said that he had not even been aware of the payments until shown a campaign budget and a contract by prosecutors.

Gramm said he played no role in drawing up the campaign's Illinois budget, which called for $103,500 in payments to consultants.

"Did you ever pay George Ryan to buy his endorsement?" Lerman asked.

"No," Gramm said.

After leaving the stand, Gramm refused to talk with reporters, was escorted down a back elevator by federal officials and whisked away by car.

A Gramm aide, John Weaver, testified Wednesday that he was surprised at the $103,500 amount and asked Ryan chief of staff Scott Fawell about it. He said Fawell answered: "That's the way we do things in Chicago."

Fawell was convicted in March 2003 of racketeering in connection with Ryan's eight-year tenure in the secretary of state's office and his political campaigns. He is serving a 6 1/2 year sentence in federal prison and is awaiting sentencing in a bid-rigging case.