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Dick Armey Defends His $8 Million Deal to Leave FreedomWorks

Amy Sussman/Getty Images The New Yorker(WASHINGTON) -- Former House majority leader Dick Armey says he took an $8 million consulting deal in return for leaving the conservative organization FreedomWorks because the group was "dishonest" and because he "couldn't leave with empty pockets."

The arrangement, he says, will allow him to "never have to work again forever."

In an interview with ABC News, Armey spoke frankly and at length about his dispute with FreedomWorks, his eyebrow raising consulting contract, and the strategy of the Republican Party.

Armey, 72, was a leader in the 1994 Republican takeover of the House and became House majority leader. He retired from Congress in 2002 and had become a leader of the Tea Party movement in recent years.

The Washington Post this week detailed what it called a coup Armey tried to pull off at FreedomWorks in September with the help of gun carrying aide after his relationship with FreedomWorks' president, Matt Kibbe, became hostile.

While Armey disputes the description of using an armed aide to conduct a coup, he admits that he agreed to leave FreedomWorks as part of a deal with Richard Stephenson, president of the for-profit Cancer Treatment Centers of America.

Under the terms of the deal, Armey will receive $400,000 a year until he is 92 – a total of $8 million – to be a consultant for Stephenson.

"I can talk about economics because I am an economist," Armey said. "I can talk about what's going on on the Hill, in politics, who's a winner, who's a loser, things of that nature."

Stephenson stepped in, Armey says, because he "was concerned I was going to resign (from FreedomWorks) and sue them before the (presidential) election. He didn't want an uproar. We all understood if I take any action that made it at all public it would be a press nightmare and we didn't want that before the election…”

"So Dick was saying, 'You know, Armey, my family and I have heard your story, about how you can't afford to retire and we want to help with your retirement,'" Armey said.

The former leader of the House Republicans said it was a deal he just couldn't refuse.

"I can't stay here (FreedomWorks), I can't work with people like this, and I can't afford to leave with empty pockets," Armey said.

He said his choice was to put in "10 years of hard labor" to win control of FreedomWorks when Stephenson said to him, "'Instead of hard labor, how about you never have to work again forever?' How many people are going to have trouble of making that choice at the age of 72?"

Armey said his fight with Kibbe was prompted by "pretty underhanded stuff," essentially a battle over royalties being paid to Kibbe instead of FreedomWorks for Kibbe's book Hostile Takeover. Armey claims FreedomWorks' staff provided research and marketing help for the book, and Kibbe tried to get Armey to sign a memorandum saying he did not use the organization's resources.

"We had a very dysfunctional organization that was being used primarily at that time scheduling all kinds of things in the interest of establishing a reputation for Matt and selling his book," Armey said. He also complained that he was being kept out of fundraising meetings and press requests for himself were being redirected to Kibbe in an effort to make Kibbe the face of the Tea Party movement.

Neither Kibbe nor FreedomWorks Vice President Adam Brandon would talk about Armey's accusations and the group's press secretary Jacqueline Bodnar said only, "We want to thank Dick Armey for his years of service. We are focused and excited heading into 2013 and we wish him well."

"We are just moving into 2013," Bodnar said. "FreedomWorks has always had the same mission to create a winning constituency of activists of limited government. We've always done that and we will continue to do that in 2013 and we are excited to do that in 2013."

Copyright 2012 ABC News Radio

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