But this depiction of what Carter did doesn’t quite capture the complexity or scale of his private business interest. It’s a longer story than that, involving two pretty big companies (especially for the time), a cozy relationship with the guy put in charge of his company, and, at one point, the appointment of a special counsel. to dig one of the loans his companies received — from a bank whose president ended up serving in Carter’s administration.
We can start with the scale of this “peanut farm”. What was really at stake was a pair of companies. Carter Farms owned between 2,000 and 3,000 acres of land, with Carter controlling 91% of the company. He also owned a controlling interest in Carter Warehouse, a peanut warehousing company based in his hometown of Plains, Ga.
In the years leading up to his election as President in 1976, day-to-day warehouse operations were handled by his brother, Billy Carter. Billy Carter would end up being a perpetual thorn in the side of President Jimmy Carter, a trend that began before Carter was even sworn in. In the years leading up to the presidential bid, for example, Billy Carter took out loans from the National Bank of Georgia to expand warehouse operations — at a time that coincided with a peanut drought. These loans eventually totaled $6.5 million, about $31 million today.
Before Jimmy Carter was inaugurated on January 20, 1977, he announced a broad set of rules intended to dictate the behavior of administration officials. After all, he was the first elected president in the post-Watergate era, and the scrutiny of presidential ethics was rigorous.
“Under the plan announced today,” the New York Times reported, “Mr. Carter will sell all of his personal stock, divert royalties from his autobiography, ‘Why Not the Best?’, to a foundation that will establish a future library for house presidential documents, and will transfer its interest in Carter’s Warehouse and Carter Farms Inc. to the trust.
“The intent of this plan, Mr. Carter told reporters this morning,” the report continues, “is to ensure that ‘everything that happens here in Plains, based on my decisions regarding agriculture , will not affect my earnings in any way. ‘ ”
However, the administration was quick to face ethical questions. Carter’s nominee to head the Office of Management and Budget was Bert Lance, an adviser to his campaign — and the president of the bank that gave Carter’s company that large loan. Lance resigned under a cloud of ethics in September 1977, facing questions about his management of the bank.
Shortly after his inauguration, Carter announced that the blind trust that would manage his businesses would be headed by Charles Kirbo, a longtime partner and confidant. In early February, he spelled out the structure of the trust in more detail. At this point, Carter handed control over to his administrator Kirbo, asking him to consider the possible effects of any decision on Billy Carter and the possibility of his son ever being involved in the business.
“Above all,” the document describing the trust explained, President Carter “wants the trustee to organize the assets of the trust so that no one can reasonably say that [his] actions as president were motivated by a desire to further his own personal monetary gain or profit.
Soon after, Billy Carter announced that he planned to buy out his brother’s share of the warehouse business. Kirbo, now in charge, rejected the proposal, ultimately pushing Billy Carter out of the company in September. Billy Carter would later publicly denounce Kirbo – but also quietly received a $250,000 loan from the separate farming company.
In June 1979, President Carter released personal financial documents, including the revelation that his net worth had declined.
“White House officials, arguing that the trust is ‘blind’ and that neither they nor Carter are informed of its operations,” the Washington Post reported at the time, “said they could not explain However, White House attorney Robert Lipshutz said the loss was likely to relate to transactions of the Carter family’s peanut warehouse business, which accounts for a significant portion of the trust.
By February 1979, Kirbo had marketed the warehouse business.
“I could have sold it a while ago to strangers,” Kirbo told the Post. “But there’s already been enough bad publicity about it without selling to them.”
“Kirbo emphasized that the potential foreign buyers were not Arabs,” The Post reported at the time.
This was important in part because of the tensions between the United States and Arab countries at the time. It was also important because Billy Carter had made headlines in January, liking Libyan nationals and decrying “Jewish media” to denigrate Arab countries.
The following month, a warehouse worker told the Post that the loans President Carter’s company received from the National Bank of Georgia were secured by peanuts sold by Billy Carter instead of being held as collateral. A special counsel, Paul J. Curran, was appointed to investigate the loans and see if any of the loan money went to Carter’s campaign.
Carter was also subject to new ethics rules which he enacted as the Ethics in Government Act of 1978. For his businesses to be held in true blind trust, he would have had to maintain a strict wall between himself and Kirbo. . . But Kirbo has always served as an adviser to Carter, with a June 1980 article in The Times noting that Kirbo was both a frequent guest at the White House and had advised the president on personnel decisions.
Given this relationship, Carter’s team reported the financial details of his ventures, describing the trust as “open” (under new law definitions) as opposed to “blind”. That’s when the loan to Billy Carter in 1977 was made public.
At that time, President Carter was a millionaire and worth about $5 million in 2019 dollars. The trust was worth about $784,000, about $3.7 million now.
In October, special counsel Curran exonerated anyone of wrongdoing in the bank loans investigation.
“The special counsel said, ‘No evidence has been uncovered that funds were diverted from the warehouse to the campaign,’ the Post reported. “As to whether criminal charges were warranted, Curran said that “the answer is also clearly no”. ”
The only person considered for the charges was a bank employee.
In November 1980, Carter lost his re-election bid in the face of a stagnant economy and international tensions. The following January, Ronald Reagan was inaugurated and Carter returned to Plains.
In March 1981, with the need for semi-blind trust gone, the warehouse company was sold to an Illinois animal feed company for $1.2 million.
By then, Trump, 21 years his junior, was already a millionaire in Manhattan. He would not be president for 36 years.
