LA Times, 11 Dec 2001
Connect the Enron Dots to Bush
By Robert Scheer
Enron is Whitewater in spades. This isn't just some rinky-dink land
investment like the one dredged up by right-wing enemies to haunt the
Clinton White House--but rather it has the makings of the greatest
presidential scandal since the Teapot Dome.
The Bush administration has a long and intimate relationship with Enron,
whose much-discredited chairman, Kenneth L. Lay, was a primary financial
backer of George W. Bush's rise to the presidency.
It was Enron that provided the model for the administration's trickle-down
attempt to revive an economy that's been in steep decline during Bush's
tenure. That model gives the fat-cat corporate hotshots everything they
want in return for bankrolling political campaigns. Not to worry about the
rest of us because, hey, what's good for Enron is good for America. That it
hasn't been is now painfully clear.
What did Enron get in return for its contributions? It got its way on
deregulation, for one thing. Remember when the administration refused to
assist California and other states during the energy crisis, and consumers
paid the steep price?
So greedy was Enron that it locked its own workers into a pension plan
based on inflated company stock values and suspect hidden partnerships,
while the top leadership led by Lay made out like bandits.
Bush should be called as a witness in the congressional hearings scheduled
to unravel this mess. One thing that should come up in the hearings is
then-Gov. Bush's October 1997 telephone call on behalf of Lay to
then-Pennsylvania Gov. Tom Ridge to help Enron crack into the tightly
regulated Pennsylvania electricity market.
"I called George W. to kind of tell him what was going on," Lay told the
New York Times about the 1997 phone call, "and I said that it would be very
helpful to Enron, which is obviously a large company in the state of Texas,
if he could just call the governor [of Pennsylvania] and tell him [Enron]
is a serious company, this is a professional company, a good company."
Since we now know Enron lacked those virtues, it's clear Bush was used to
sell a bill of goods to the unsuspecting Pennsylvania folks.
That Lay was instrumental in Bush's rise to the presidency is indisputable.
Since 1993, Lay and top Enron executives donated nearly $2 million to Bush.
Lay also personally donated $326,000 in soft money to the Republican Party
in the three years prior to Bush's presidential bid, and he was one of the
Republican "pioneers" who raised $100,000 in smaller contributions for
Bush. Lay's wife donated $100,000 for inauguration festivities.
As governor, Bush did what Enron wanted, cutting taxes and deregulating
utilities. The deregulation ideology, which George W. long had adopted as
gospel, allowed dubious bookkeeping and other acts of chicanery that
shocked Wall Street and drove a $60-billion company, seventh on the Fortune
500 list, into bankruptcy.
This emerging scandal makes Whitewater seem puny in comparison; clearly
there ought to be at least as aggressive a congressional inquiry into the
connection between the Bush administration and the Enron debacle. Facts
must be revealed, beginning with the content of Lay's private meeting with
Vice President Dick Cheney to create the administration's energy policy.
What was Lay's role in the sudden replacement of Curtis Hebert Jr. as
Federal Energy Regulatory Commission chairman? As the New York Times
reported, Hebert "had barely settled into his new job this year when he had
an unsettling telephone conversation with Kenneth L. Lay, [in which Lay]
prodded him to back ... a faster pace in opening up access to the
electricity transmission grid to companies like Enron." Lay admits making
the call but in an unctuous defense of his influence peddling said, "The
final decision on [Hebert's job] was going to be the president's, certainly
not ours." Soon after, Hebert was replaced by Texan Pat Wood, who was
favored by Lay.
Other questions: Was there any conflict of interest in the roles played by
key Bush aides? Political advisor Karl Rove owned as much as $250,000 in
Enron stock. And economic advisor Larry Lindsay and Trade Representative
Robert B. Zoellick went straight from Enron's payroll to their federal jobs.
There are other Enron alum in the administration, including Army Secretary
Thomas White Jr., who, as an Enron executive, held stock and options
totaling $50 million to $100 million.
We have a right to know whether the Enron alums in the administration were
tipped off in time to bail out with profit the way Lay and the other Enron
top execs did, while their workers and stockholders--and eventually U.S.
taxpayers--are being left holding the suddenly empty bag.
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