LITTLE ROCK, Ark. - The night Bill Clinton was elected president, the 27-story Worthen Bank building lit up the skyline here with red, white and blue lights spelling his first name.
The bank had good reason to crow.
Worthen is partly owned by the Stephens family, one of the richest in the United States. And the family, headed by oilman and investment banker Jackson Stephens, and their businesses did more than anyone to bankroll Clinton's political ascendancy.
Early in the game, the Stephenses raised $100,000 in Arkansas to get Clinton's candidacy up and running. Then last spring, when Clinton was trailing both George Bush and Ross Perot, Worthen Bank supplied the cash-starved campaign with a $3.5 million line of credit.
Jim Wells, a vice president in Merrill Lynch & Co.'s Memphis, Tenn., office, evokes a revealing aphorism about money and politics:
"Money is like rain. It is not just getting the rain, but when you get it that counts. And (the Stephens money) was like rain from heaven.
"Nobody knows how influential Mr. Stephens will be in the next administration, but I would be surprised if his counsel isn't called on from time to time."
The centerpiece of the family's $1 billion empire is Stephens Inc., one of the largest investment banking firms off Wall Street. In addition to their 38 percent interest in Worthen Bank, the family owns stakes in oil and natural gas, utilities, nursing homes, waste management, diamond mining and hog farming.
BOTH SIDES HAD COMMON `BOND'
President Clinton has hundreds of relationships with businesses and individuals that will be dissected over the next four years. But few bonds are so intricate as those that tie the former Arkansas governor to the state's most influential family.
Throughout Clinton's tenure as governor, Stephens Inc. handled many of the state's bond sales. Stephens' subsidiaries and employees helped Clinton through a tight 1990 gubernatorial race, contributing at least $42,000, according to campaign finance records.
Stephens Inc. also loaned $100,000 to the inaugural. And the Clinton campaign has kept up to $55 million in federal election funding in Worthen Bank.
The Stephens businesses are often represented by the Rose law firm, where Hillary Clinton has been a partner. Until the mid-1980s, they owned Arkla Inc., the Shreveport, La., natural-gas utility from which Clinton tapped chairman Mack McLarty as his White House chief of staff. Their investment firm serves as business manager to the Bloodworth-Thomasons, the Hollywood couple who helped choreograph Clinton's public image.
Jackson Stephens, 69, declined an interview request. But his son, Warren, played down the firm's political clout.
"We have not seen any benefit from it," said Warren Stephens, 35, who succeeded his father as chief executive officer of Stephens Inc. five years ago. He conceded, however, "I'm sure there will be some business to walk in the door" as a result of the Clinton connection.
The Stephens fortune was built by Jackson's older brother, Witt, who died a year ago. Arkansas historians describe Witt as the kingmaker in state politics.
"In this state you are looking at what is basically a 19th-century oligopoly where a small group of interlocking business interests controls everything," said Susan Power, a political science professor at Arkansas State University. "No one is as successful at politics here as the Stephenses."
Bob Tucker, manager of the Little Rock office of A.G. Edwards & Co., a national brokerage firm, said the Stephens' influence "cannot be overstated."
NOT ALWAYS FRIENDLY TO `THAT BOY'
When Bill Clinton burst upon the Arkansas political scene, a bright comet fresh from Yale Law School, the Stephenses were not easily impressed. An acquaintance recalls that Witt had a condescending attitude to the young Clinton, even referring to him as "that boy."
Roy Reed, an Arkansas writer, says Clinton's attitude was "kind of standoffish. He wanted it to be known that Witt Stephens couldn't call the shots." Still, the Stephenses continued to prosper under the Clinton administration.
Roy Drew, the investment adviser and a frequent Stephens critic, said a relationship was quickly cemented by mutual interest: The Stephenses wanted to sell bonds. Clinton saw the issuance of bonds as a way out of fiscal problems.
"It is the new way politicians can make friends with the business community and get things done. Rather than tax and spend, you borrow and spend," Drew said.
During the 1980s, figures supplied by Securities Data Corp. show Stephens Inc. was involved with approximately 61 percent of the $7 billion worth of bonds issued in Arkansas, more than any other underwriter.
Occasionally, the Stephens' handling of these bond issues drew public criticism.
With Clinton's support, Stephens Inc. devised a creative plan to bail out Arkansas' ailing student-loan authority. But the state's auditor, Julia Hughes Jones, raised a stink.
She complained that the plan - which called for state retirement funds to buy $100 million in student-loan-authority
called during the 1990 gubernatorial race
bonds - was a rotten deal for the retirees. She also thought Stephens' fees were too high, and that the firm had a conflict of interest in simultaneously trying to sell the bonds while serving as an adviser to the retirement funds.
She said a string of woes befell her after she opposed the deal. Her department's budget was rejected by the state assembly for the first time ever. She said she was told by an assemblyman she had to fire Roy Drew, who, as a financial consultant, had criticized the deals. A collection agency for the student-loan authority started harassing her with telephone calls over a student loan to her daughter, even though her daughter had not been late on a single payment, Jones said.
"Some Stephens employees got pretty hateful where I was concerned," Jones said. ". . . I don't know it for a fact, but I think they were behind my budget being held up."
Under fire, Jones gave in. The retirement funds bought $100 million of the bonds and another $100 million in bonds to bail out two other agencies. The deals earned Stephens $1.8 million.
"The criticism, frankly, is from people who didn't understand the bond issues," Warren Stephens said.
If the Stephenses were initially lukewarm towards Clinton, all that had changed by the 1990 gubernatorial race. Clinton was in a close race with Sheffield Nelson, a lawyer with whom the Stephenses had had a bitter business feud.
Campaign-finance records in Arkansas show that a dozen different Stephens corporations wrote checks for the maximum allowed to Clinton - $1,000 each. Most of the money was given on the same day. Combined with contributions from Stephens employees, at least $42,000 was raised - about 3 percent of the total cost of the race.
Warren Stephens recalls that he had gotten a panicky call from Clinton a few days before the election asking for help for some last-minute television advertising.
"It was clear that he had a case of pre-election jitters," said Warren. "He told me he wanted to raise $50,000 and asked me if I could raise $10,000, and I said sure."
For the Clinton era, it looks like Warren Stephens will be a more visible player than his father. Warren raised more than $100,000 for Clinton in the primaries and attended last month's economic summit in Little Rock.
Another potential player in the new political lineup is Curt Bradbury, the 43-year-old chairman of Worthen Bank. Bradbury donated $10,000 to the Democratic Party and, along with McLarty, helped organize fund-raisers in Little Rock that brought in $2 million.
Bradbury also arranged the $3.5 million credit line - $3 million was used - to the Clinton campaign in March, a period when Clinton was so broke that staffers were carrying expenses on their personal credit cards.
The loans have been repaid. Then in July, when the Clinton campaign received $55 million in federal funds to pay for the general election, the money was deposited with Worthen - interest free. (Under federal election law, any interest received would have to revert to the U.S. Treasury under federal law.)
What might the Stephenses and Worthen Bank hope to gain over the next four years?
-- Natural gas. The Stephenses have extensive holdings in natural gas, a resource strongly supported by Clinton.
-- Banking. They, along with Bradbury, have been vocal proponents of easing banking regulations - in particular the limits on interstate banking and the Glass-Steagal Act that separates banks from brokerage firms.
As Bradbury summed it up in an interview last year with the Arkansas Times, "I would like to be in a position to think I could call the president of the United States and give him my views."