KENTUCKY: Tax Troubles

On his chosen path of professional politics. Kentucky’s Earle C. Clements traveled far, becoming a Congressman, then Governor (1947-50), then a U.S. Senator (1950-56). Even after he lost his 1956 Senate race to Thruston B. Morton (now Republican national chairman), Clements remained a power in Kentucky politics. Texas’ Lyndon B. Johnson, under whom Clements had served as assistant Senate majority leader, thought so highly of Clements’ political influence and skills that he made him a top “coordinator” of his vice-presidential campaign.

Last week a blow far more jolting than his 1956 defeat landed on Earle Clements, 63. The news got out that the U.S. Government had filed a $291,288.97 income tax claim against him—$183,461.46 in back income taxes for 1948-56, plus $107,827.51 in penalties for tax fraud and other alleged violations. Among other things, the U.S. charged that over the years Clements diverted $147,000 from “unexpended political campaign funds” to his personal use. By the Government’s reckoning, Clements’ assets soared from $33,760 in 1947 to $415,416 in 1956.

Clements challenged the arithmetic, said the way he figured it the U.S. owed him $2,520 in income tax overpayments.