Sing Me No Torch Songs

It was hardly a battle of equals. In one corner, Lee Iacocca, 61--the industrial wizard who, with a little help from his federal friends, lifted Chrysler Corp. out of bankruptcy and into high profits; the celebrated author of the best-selling autobiography (2.6 million copies and still No. 1) ever written; the two-fisted presidential possibility who, though he has described himself as a Republican, dances in the dreams of many hopeful Democrats; the whirlwind fund raiser leading the overdrive effort to restore one of America's most cherished icons, the Statue of Liberty. In the other corner, Donald P. Hodel, 50. Donald who?

To the astonishment (and entertainment) of much of official Washington, the little-known Secretary of the Interior last week fired Iacocca as chairman of the Statue of Liberty-Ellis Island Centennial Commission. The 43-member group, which includes such assorted luminaries as former U.N. Ambassador Jeane Kirkpatrick and Bob Hope, was created in 1982 to give the Interior Department advice on how to restore Miss Liberty along with nearby Ellis Island, where as many as 16 million immigrants entered America between 1892 and 1924 (among them: Iacocca's parents). What former Interior Secretary James Watt had done for the Beach Boys by trying to ban one of their Fourth of July concerts in Washington, Hodel seemed to do for the made-in-America Chrysler chairman: give him the publicity he so eagerly seeks. But a former Interior official (not Watt) cast Hodel's decision in heroic terms, calling it "the most courageous act since Truman fired MacArthur."

Whether he had been courageous, dumb or just quirky, Hodel suddenly became the target of Iacocca's verbal wrath. Never one to hide his feelings, or his ego, the Chrysler chairman blasted back. His summary dismissal, he charged, "borders on being un-American." He referred to "all the crap I've taken." He declared, "I do not appreciate being disenfranchised on somebody's whim."

Hodel, a former head of the Bonneville Power Administration, took the onslaught with outward calm and an occasional smile. Iacocca was fired, he suggested, chiefly because he got too big for his britches. "The statue is more than Lee Iacocca," he said. Hodel's justification was, at best, a bit thin. He insisted that there was a "potential conflict of interest" between Iacocca's role as chairman of the governmental advisory commission and his leadership of the private Statue of Liberty-Ellis Island Foundation, the group that has been spectacularly successful in raising some $233 million for the restoration projects. Those who raised the money, Hodel suggested, should not also have a dominant voice in how it is spent. That would seem to be quite a novel principle in Washington.

Hodel said that he never focused on the conflict of interest problem when things were going well; as late as last October he reappointed Iacocca as chairman of the commission. The conflict possibility hit him, he says, only after Iacocca indirectly raised the issue on Jan. 29. Palmer Wald, the foundation's counsel, had sent telegrams to two men who sat on both the commission and the foundation board. Wald asked them to leave one of the groups because "the chairman requests there be no crossover of commission and foundation board membership." Both chose to leave the foundation.