The Bush-Enron Connection

BOB HERBERT
New York Times News Service

   You’ll have to look long and extremely hard to come up with an example of corporate treachery in the United States that’s as horrible as the Enron debacle. This is a scandal with a very broad reach and it has some of the wise guys in the Bush administration and other top Republicans trembling in their penny loafers.
   Enron was a bonanza for — whom else? — the folks at the top of the pyramid. They ferociously exploited their gilt-edged political connections and harvested breathtaking amounts of cash for themselves, even as the company was collapsing into the biggest bankruptcy mess in U.S. history. Left behind were thousands of ordinary working men and women, people with families and obligations, who lost jobs, life savings, pensions, the works. And more carnage is to come.
   The fallout is nationwide. A week before Christmas, Sen. Ron Wyden, D-Ore., spoke about the gloom that had settled over workers in his state who watched their retirement funds vanish. “Because of what happened at Enron,’’ he said, “there are Oregon families going to grief counseling rather than holiday parties this year.’’
   No one knows yet the extent of the illegality — if any — that went on at Enron. The Justice Department announced last Wednesday that it would open a criminal investigation. But there is no doubt that many of the company’s top officials swam, as a matter of course, in an ethical sewer. They were pals with, and lavishly greased the palms of, powerful people who were willing to guide government policy toward Enron’s ends, and who could help the company escape close scrutiny of its more sinister activities.
   The Center for Public Integrity, a nonpartisan watchdog agency in Washington, examined the political contributions of 29 top Enron executives and directors named in a shareholder lawsuit filed against the company last month. Twenty-four of the 29 made contributions from 1999 to 2001 — totaling nearly $800,000 — to George W. Bush, members of Congress, the two national political parties (with the bulk of the contributions going to the Republicans) and a variety of officials who are now responsible for investigating possible securities fraud by Enron.
   Of the five who did not make contributions, two were foreign nationals prohibited by law from contributing to candidates or parties.
   “The folks at the top of the company gave lavishly,’’ said Charles Lewis, the center’s executive director. “It just shows that this is a company inordinately dependent on government favors.’’
   And how did these generous Enron officials behave as the apocalypse approached?
   The shareholders’ suit, as the center noted in its study, “alleges that the 29 executives and directors dumped $1.1 billion worth of stock while knowing the company was in danger of collapse.’’
   Defendants in the lawsuit have disputed the charges against them. But there is no disputing that as Enron toppled and fell, insiders unloaded hundreds of millions of dollars’ worth of stock while rank-and-file Enron employees were locked into rules that left many of them helpless as the stock’s value plunged from more than $90 a share to less than $1.
   It has long been known that Enron and its chairman, Kenneth Lay, were close to President Bush. In Lewis’ book, “The Buying of the President 2000,’’ Enron was already listed as Bush’s No. 1 career patron.
   This week the office of Vice President Dick Cheney reluctantly disclosed that Enron executives met with Cheney or his aides at least six times as the Bush administration — with Cheney in charge — was putting together its national energy policy.
   It will be interesting to find out, as this scandal continues to unfold, how aggressively the Justice Department, the Securities and Exchange Commission and other appropriate agencies investigate a company that has been as generous and as wired and as powerfully influential as Enron.
   There’s already talk that Harvey Pitt, the chairman of the SEC, may have to recuse himself because as a lawyer in private practice he did work for Arthur Andersen, the company that audited Enron’s books with its eyes closed.
   Enron is a case study in the dangers that will inevitably arise when unrestrained corporate greed is joined at the hip with the legalized bribery and influence-peddling that passes for government these days.