Monday, Aug. 07, 1972

McGovern's Henry the K

High among the time-honored privileges of campaign fund-raisers is the chance to bask in the reflected glory of a successful candidate. Even so, on the night of George McGovern's nomination in Miami Beach, his national finance chairman, Henry Kimelman, seemed to be doing much more than mere basking. With his arm wrapped around McGovern's wife Eleanor, Kimelman flashed enough winning smiles and V signs at the TV cameras to have been the candidate himself. Gary Grant, with whom the darkly handsome Kimelman has occasionally been compared, might call the scene one in which a supporting actor makes his move toward stardom. Indeed, Kimelman's real-life business career has abounded with successful reaches for top billing.

Brooklyn-bred Kimelman, 51, is chairman of the West Indies Corp., the biggest (annual sales: $18 million) import house in the Virgin Islands, his adopted home of more than two decades. As the islands' commissioner of commerce from 1961 to 1964, Kimelman was one of several businessmen who turned the U.S. possession from a sleepy haven of sand and sun into a tourist mecca. Since the islands are one of the two American free ports outside the U.S. (the other: Guam), the business of importing duty-free liquor, perfume and other goodies for tourists has grown fast. Kimelman's fortune is estimated to be $10 million.

The son of a textile importer, Kimelman got into the liquor business through his father-in-law, who owned a rum distillery in Puerto Rico. Kimelman moved to St. Thomas after investing in the islands' earliest first-class resort hotel, the Virgin Isle, which he later leased on hugely favorable terms to Hilton. Kimelman and his brother-in-law acquired the distributorships of a number of name-brand liquors, including Cherry Heering, Grand Marnier and J & B Scotch. When the Johnson Administration tried to ease the nation's balance of payments deficit by chopping, from a gallon to a quart, the nontaxable liquor allowance for Americans returning from abroad, Kimelman helped lead the successful fight to keep the one-gallon rule in the Virgin Islands. That greatly lifted the islands' tourism --and Kimelman's fortunes.

One Word. Not without egotism, Kimelman says, "I enjoy achievement." His unceasing drive soured many personal relationships, including those with his brother-in-law, who dropped out of the business, and with former Governor Ralph M. Paiewonsky, who accepted his resignation from the commerce commission. But Kimelman caught the SAMMA fancy of Stewart Udall, then the Interior Secretary, who hired him as his aide. In Washington, Kimelman became friends with McGovern, whom he admired for his antiwar stand. McGovern and his supporters have been frequent guests at the Kimelman home overlooking the Charlotte Amalie harbor. (Campaign Managers Frank Mankiewicz and Gary Hart rested up from the Democratic Convention there.)

A group was celebrating McGovern's 47th birthday at the Kimelman home in 1969 when they got word of Teddy Kennedy's Chappaquiddick accident.

As Kimelman tells it, he immediately urged McGovern to run for the '72 nomination and promised:

"I'll make it possible."

As finance chairman, Kimelman specialized in putting the arm on big contributors for McGovern's primary battles, raising some $2.5 million, including $80,000 of his own funds. He is also the organization's budget director and became known to McGovern staffers as a tight-fisted spender. "I'm a good clamper-downer," says Kimelman. "I have a lot of one-word answers: No." Among others who bridled at Kimelman's autocratic ways was Max Palevsky, a Xerox millionaire and prime McGovern contributor. Recently he pulled out of the candidate's organization, partly over differences with Kimelman.

Kimelman figures that he must raise at least $25 million for McGovern's presidential race. "I've always been fiscally conservative," he says. "Every year, no matter what my income was, I've saved a little and invested a little." Using the same rule, he is putting 25% of the campaign contributions into a trust fund that later will be used to make repayments to people who merely lend money to the campaign. Whether he can keep on feeding the trust fund if

McGovern's cash runs short remains to be seen.

Last week, fully realizing that his candidate is not exactly a hero to most bigtime political donors anyway, Kimelman was somewhat distressed over the revelations about Senator Thomas Eagleton's mental-health history. Should McGovern be able to overcome the increasingly steep odds and manage to bankroll a winning campaign, his own Henry the K will probably deserve the ambassadorship that he admittedly covets.

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