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Chapter IV: Arizona, the early years

By Bill Muller
The Arizona Republic
June 05, 1999 12:12:00

In 1979, John McCain came face to face with his future.

He was in Hawaii, attending a military reception. While there, he met a young, blond, former cheerleader named Cindy Hensley.

It was an incredible stroke of luck for McCain.

How fortunate could one man be? Here was McCain, who had his eye on Congress, meeting a young, attractive beer heiress from Arizona, which was adding a congressional district in 1982.

McCain recalls that both he and Cindy fudged their ages at first. McCain made himself a little younger and Cindy made herself a little older. They found out their real ages when the local paper published them. McCain was 43, Cindy 25.

''So our marriage,'' McCain cracks, ''is really based on a tissue of lies.''

While they were dating, McCain called Cindy from Beijing, where he was traveling with a contingent from the Senate Foreign Relations Committee while she was in the hospital recuperating from minor knee surgery. She thanked him for the lovely flowers in her room, sent from ''John.''

What McCain didn't tell Cindy was that he hadn't sent the flowers. They were from another John, who lived in Tucson.

''I never thanked him,'' Cindy notes with a grin.

After a whirlwind courtship, John asked Cindy to marry him. But there were some details to clear out of the way.

McCain needed a divorce from his wife of 14 years, Carol, who had been badly injured in a car accident while McCain languished in Hanoi.

The marriage had been strained by his years of absence, along with McCain's admitted affairs after returning from Vietnam.

In February 1980, less than a year after he met Cindy, McCain petitioned a Florida court to dissolve his marriage to Carol, calling the union ''irretrievably broken.'' Bud Day, a lawyer and fellow POW, handled the case.

''I thought things were going fairly well, and then it just came apart,'' Day recalls. ''That happened to quite a few. . . . I don't fault (Carol), and I don't really fault John, either.''

In the divorce settlement, McCain was generous with Carol, the mother of their daughter Sydney and two other children, whom McCain had adopted. Among other things, McCain gave Carol the rights to houses in Florida and Virginia, and agreed to pay her medical bills for life.

Except for signing the property settlement, Carol did not participate in the divorce. A court summons and other paperwork sent to her during the proceeding went unanswered.

In April, the judge entered a default judgment and declared the marriage dissolved.

A month later, McCain married Cindy in Phoenix, and they moved there.

McCain was immediately plugged into Arizona's power elite. Cindy's father, Jim Hensley, owned a Phoenix Anheuser-Busch distributorship that had made him a millionaire many times over.

It was no secret that McCain was interested in a political career. In the six years after he returned from Vietnam, he had been in rehab and then was assigned to a political post, working in the Navy's Senate liaison office in Washington.

While there, McCain made friends with such political movers as Sen. Gary Hart and Sen. John Tower, who was the ranking Republican on the Armed Services Committee. He also met Sen. Bill Cohen, now the secretary of Defense, who ended up being the best man at John and Cindy's wedding.

In 1981, McCain retired from the Navy, mostly because of his badly injured knees and shoulder, compliments of his North Vietnamese captors. Hensley gave his new son-in-law a job as vice president of public relations, but McCain was soon bored.

''Jim Hensley didn't care about PR,'' said Bill Shover, a former executive with Phoenix Newspapers Inc. who met McCain in 1981. ''When you have the Budweiser franchise, you have a license to steal. You don't need PR.''

It didn't take long for McCain to meet wealthy power brokers such as developer Charles Keating Jr. and Fife Symington III, who would later be elected governor. Local pols suggested McCain start slowly by running for the state Legislature, but McCain would have none of it.

Eager to make up for time lost as a POW, McCain wanted Arizona's new congressional seat.

But he had a problem. The new district was in Tucson. For McCain to move from Phoenix to Tucson would open him up to criticism as a carpetbagger.

Fate lent a hand. In January 1982, Rep. John Rhodes retired from the 1st District seat, which includes the East Valley.

On the day Rhodes announced his retirement, Shover got a call from McCain. He could hear noise in the background.

''Where are you?'' Shover asked.

''I'm on the freeway,'' said McCain, who had stopped at a service station to call Shover. ''I'm on the way to Mesa to buy a house.''

Many have told the tale of John McCain winning the 1st Congressional District by wearing out three pairs of shoes. McCain's footwear definitely took a beating during the race, but it was more greenbacks than soles that swept McCain into the U.S. House of Representatives in 1982.

McCain's first campaign benefited from his wife's personal wealth, some of which had been tied up in a trust set up in 1971 by her parents, Jim and Marguerite ''Smitty'' Hensley.

In 1981, the trust expired and was dissolved, giving Cindy McCain a half interest in Western Leasing Co., a truck-leasing business controlled by her father, said Trevor Potter, general counsel to the McCain 2000 campaign and former chairman of the Federal Election Commission.

In 1982, Cindy McCain received $639,000 from Western Leasing, according to a financial disclosure report filed by McCain. Potter said that figure reflects Cindy's income on paper, not the actual cash she received, which was about $250,000.

In any case, that same year, the McCains lent $169,000 of their own money to the campaign. Western Leasing, in part, made those loans possible, Potter said.

''Her financial assets played a part in allowing them to loan money to the campaign,'' Potter said. ''And her financial assets included the income from Western Leasing.''

Western Leasing was not the only income the McCains had in 1982. They earned a combined $130,000 in salary and bonuses from Hensley and Co., the beer distributorship controlled by Cindy's father. John also had his Navy pension, which paid $31,000 a year.

''No one pretends that Cindy had no money at all,'' Potter said. ''It was hers. And it wasn't something Jim (Hensley) had given her for the campaign.''

Under 1982 election rules, it was legal for McCain to tap his wife's assets, as well as his own, when making personal loans to the campaign. In 1983, the rules were rewritten, with tighter guidelines on the use of family money.

In the end, including the personal loans, McCain would raise more than $550,000 to win the seat.
McCain had money, and he also had another staunch ally in Phoenix: Darrow ''Duke'' Tully, publisher of the state's largest newspaper, The Republic.

Upon meeting McCain, Tully regaled him with stories of his own military service as an Air Force pilot in Korea and Vietnam. The two men quickly hit it off and soon were spending a lot of time together. Cindy McCain and Tully's second wife, Pat, also got along well. Both were far younger than their husbands.

Tully had logged many hours in Air Force simulators learning how to fly F-16s. He bragged about a simulated dogfight between him and McCain on the Goldwater gunnery range in southwest Arizona.

''Duke said he had gotten John in his sights and shot him down,'' Shover recalls. ''John couldn't maneuver very well, because of his (formerly) broken arm.''

Tully immediately started grooming McCain for public office.

Shover said Tully was practically McCain's PR man, hosting dinners to introduce him to the Valley's movers and shakers. He set up guest columns for McCain in PNI's flagship newspaper, The Republic. In one of them, McCain gave a tear-jerking account of Christmas in Hanoi. Tully became godfather to one of McCain's children.

With his connections and war record, McCain was taken seriously by the Republican establishment. Plus, McCain had charm. Women were drawn to him, and men respected him as a man's man.

''John was a very engaging guy,'' Shover recalls. ''You could not help but like John.''

McCain was vulnerable on one count. He was not from Arizona and looked like he was shopping for a congressional seat.

In 1982, at a candidates forum, McCain settled the carpetbagger issue for good. After noting that he had been a military brat and moved around his whole life, McCain played his ace in the hole.

''The place I lived the longest in my life was Hanoi,'' McCain said.

Although it was clear McCain had the tools to reach political office on his own, Tully helped open the door. Armed with a war chest provided by such people as Keating and Symington, McCain conducted a tireless door-to-door campaign and beat his primary opponents. He easily rolled over his Democratic challenger in the general election.

Tully and McCain would only get closer, and McCain would influence the paper.

In the pages of The Republic and The Phoenix Gazette, McCain could do no wrong. Political columnists adopted him like a lost puppy. Late Gazette columnist John Kolbe blasted McCain's Republican primary opponent in 1982, Jim Mack, for calling McCain's first wife to dig up dirt.

In 1984, McCain won a second term in the House, facing only token opposition. He was already hunting bigger game. McCain wanted to succeed Barry Goldwater, who was retiring from the Senate.

McCain's main stumbling block was Gov. Bruce Babbitt, a popular Democrat with deep family ties in the state. McCain's people decided early on that the race would be half won if they could persuade Babbitt to stay out.

''It wasn't so much a strategy as it was a reality,'' recalls Torie Clarke, McCain's press secretary from 1983 until 1989. ''The theory was, if we worked really hard . . . if John really could get his roots deep in Arizona, it became less and less likely that Babbitt would want to run against him.''

Babbitt also was toying with a run for president in 1988, two years after he would have been elected to the Senate. McCain's people kept the pressure on, making it clear that McCain planned an all-or-nothing assault on the seat.

In March 1985, Babbitt made it official: He wasn't running for the Senate. In May, five-term Congressman Bob Stump also took a pass, giving McCain an open field for the Republican nomination.

To face McCain, the Democrats fielded Richard Kimball, a tall, good-looking 37-year-old with an offbeat personality. Urged on by Tully, The Republic and Gazette editorial pages tore into Kimball, a former member of the Arizona Corporation Commission.

Republic columnist Pat Murphy blasted a Kimball position paper because it contained grammatical and spelling errors. Kolbe, now firmly in McCain's corner, also lampooned Kimball, saying he suffered from ''terminal weirdness.''

Of course, everyone knew that McCain was Tully's favorite.

''(Tully) was really pushing John,'' Shover said. ''He liked him. (McCain) was probably the guy Duke wanted to be. Duke was this Walter Mitty type.''

Walter Mitty to be sure. All of Tully's war stories were pure fiction. McCain, like everyone else, had been fooled.

Tully invented his military history to live up to the expectations of his father, whose other son had been killed in a military training accident.

In late 1985, the pressure of living the lie was building up inside Tully, causing him to drink and alienate his wife, Pat. After she filed for divorce, Tully, in his own words, ''was beginning to crack up.''

He began to drop not-so-subtle hints to people that he had never served in the military. Then, on Oct. 25, a concerned secretary summoned Shover to Tully's office.

Shover found Tully stepping on his plaques and certificates and throwing them into a trash can.

Determined to protect his boss, Shover told him to quietly get rid of his uniforms and to stop telling his fake war stories.

Tully refused to be quiet about it.

''It's almost like he was trying to get caught,'' Shover said.

Eventually, word leaked out to Tully's enemies, one of whom was Maricopa County Attorney Tom Collins, who had been smacked by The Republic for taking a trip with his family at taxpayer expense.

Collins, along with freelance aviation writer Dick Rose, began to investigate Tully's background. The day after Christmas, Tully told Shover that Collins would have a press conference to expose him.

Shover drafted Tully's letter of resignation and called Indianapolis, the headquarters of The Republic's parent company, Central Newspapers Inc.

Tully's reign was over.

One of the early press calls was to McCain.

''His response was kind of like, 'Yeah, I have heard of Duke Tully. I'm sorry about what happened to him. Any other questions?' '' Shover said.

Shover said McCain was a political opportunist who moved quickly to distance himself from Tully.

''In other words, he walked,'' Shover said. ''He used Duke Tully to gain what he got in his life and he left him just when Duke needed him most.''

The fall of Tully threw Kimball off balance, since he had sought to paint McCain as a tool of the newspaper and its publisher. For the next few months, Kimball darted and dashed around McCain, throwing a lot of punches and landing none.

McCain took Kimball seriously, though.

''We worried, we sweated, we were concerned every single day,'' Clarke said. ''From the first to the last, until Election Day . . . that's probably the reason John is so successful. That's the way he is.''

In June 1986, McCain gave Kimball an opening, jokingly referring to Leisure World, a retirement community, as ''Seizure World.''

Kimball launched another series of attacks, calling McCain ''bought and paid for'' by special interests, since much of McCain's campaign contributions came from political action committees in four industries: defense, real estate, petroleum and utilities.

Kimball also noted that McCain was a millionaire because of his wife's interests in the beer distributorship owned by her father. Kimball wasn't shy about airing the Hensley family laundry.

He had dug up old newspaper clips that showed Jim Hensley had been an underling to well-known power broker Kemper Marley Sr., a rich rancher and wholesale liquor baron with ties to the 1976 car-bomb murder of Arizona Republic reporter Don Bolles.

After World War II (Hensley was a bombardier on a B-17 that was shot down over the English Channel), Hensley and his brother Eugene went to work at Marley-owned liquor distributorships in Phoenix and Tucson.

In 1948, the Hensley brothers were convicted of falsifying records to conceal, government lawyers contended, the illegal distribution of hundreds of cases of liquor. The sales occurred from 1945 to 1947, postwar years when liquor was rationed and in short supply.

Eugene Hensley was sentenced to a year in federal prison. Jim Hensley got six months, but his sentence was suspended. He received probation.

In 1953, Jim Hensley was again charged with falsifying records at Marley's liquor firms. The companies were defended by William Rehnquist, who would go on to become chief justice of the U.S. Supreme Court. Hensley was found not guilty.
In late 1986, as Kimball gained ground on McCain in the Senate race, the candidates agreed to debate on television.

Since McCain was a good deal shorter than the lanky Kimball, he stood on a riser behind the podium. At one point, Kimball called him on it, saying McCain was ''standing on a soapbox'' to make himself look taller.

McCain was angry but kept his cool. The next day, he got mad all over again when he saw himself standing on the riser on the front page of The Republic.

While the debate was mostly a draw, McCain enjoyed a huge fund-raising lead, outspending Kimball nearly 4 to 1. On Election Day, McCain steamrolled Kimball, 60 percent to 40 percent.

McCain went to a downtown hotel for his acceptance speech, an event chronicled in The Nightingale's Song by Robert Timberg.

Jay Smith, McCain's political consultant, was told to make sure McCain stood on a riser as he delivered his acceptance speech.

''Arriving at the hotel shortly after McCain, Smith saw reporters and well-wishers huddle together on the stage,'' Timberg wrote. ''From the midst of the throng, he heard a familiar voice floating upward, thanking the voters for sending him to the Senate. Familiar but disembodied. McCain had seen the riser and kicked it aside. The White Tornado had become the Invisible Man.''

By 1988, McCain was a hot property and was rumored to be George Bush's choice for vice president.

''Before Dan Quayle came popping out on the dock in New Orleans, the last name eliminated for consideration by the AP wire was John McCain,'' said Scott Celley, a McCain aide at the time.

But in October 1989, everything came crashing down around McCain.


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