Washington: a city of denials, spin, and political calculations. The Nation's former DC editor David Corn spent 2002-2007 blogging on the policies, personalities and lies that spew out of the nation's capital. The complete archive appears below. Corn is now the DC editor at Mother Jones.
I had hoped to be reporting in this space today the answers of disgraced Enron CEO Ken Lay to a host of impolite questions. As you might have heard, Lay was scheduled to make his first appearance before a Congressional committee this morning--and I had planned to join the gawkers at the press tables. But yesterday, Lay canceled, claiming that recent remarks from members of Congress had led him to conclude that an anti-Lay bias had set in on Capitol Hill. Which meant that a lawyer finally had managed to talk some sense into Lay. Since he is the potential subject of criminal investigations and civil lawsuits, it would not have been wise for Lay to subject himself to wide-ranging questions from members of the Senate Commerce, Science and Transportation Committee. Consequently, I--and you--did not get to see him respond to such questions as:
* What did you expect in return for the hundreds of thousands of dollars you donated to George W. Bush over the years?
* Did you or anyone else at Enron ever try to exert influence over a regulatory matter of the US government? If so, could you please run us through all the details?
* Did you pull strings to replace the chairman of the Federal Energy Regulatory Commission last year? Did campaign contributions come in handy in such an endeavor?
* Why did you find it useful to retain as lobbyists high-level GOP operatives, such as Ralph Reed and Ed Gillespie? Did Enron place Reed on its payroll as a favor to the Bush campaign, as has been reported (but denied by Reed)?
* Did your donations to the Democratic party during the Clinton years help Enron win highly-coveted seats on trade missions led by Commerce Secretaries Ron Brown and Mickey Kantor?
* What did Enron officials and the staff of Vice President Dick Cheney's energy task force talk about?
I am presuming the Senators would have dared to ask such direct questions. But Lay is lying low, and these and other mysteries will remain for the time being.
As a public service, then, let me put to good use the space otherwise reserved for the Lay testimony.
A few days ago, the inimitable Molly Ivins called me. There was a slight dire tone in her voice, which is unusual. Molly gets dire about few things. What had riled her was a quote put out by the White House. In yet one more attempt to distance Bush from his (previously) good friend Lay (once known to Bush as "Kenny Boy"), a White House aide had told reporters that Bush was outraged that Lay and other executives had sold hundreds of millions in Enron stock before the company collapsed and the stock plummeted. The aide quoted an angered Bush as saying, "I thought the captain was supposed to be the last one off the sinking ship, not the first one."
This was hypocrisy, Molly noted. See my book, she said, and you'll see why. As soon as I could, I found my copy of "Shrub: The Short But Happy Political Life of George W. Bush" (cowritten with Lou Dubose), and located the relevant passage. (For those of you playing at home, pages 27 to 33.)
This section of the book covered the years before Bush entered electoral politics, the time when he was a failing-upward oil man. When W.'s father was president of the United States, George the Younger was a major shareholder in a sinking oil venture called Spectrum 7. But before Spectrum 7 sank completely, the Harken Energy Corporation, which was run by a GOP funder, bailed out the company. Bush got about $500,000 in Harken stock for his piece of Spectrum 7, and Harken signed him up as a consultant. Harken went on to win a 35-year exploration contract with the emirate of Bahrain in the Persian Gulf--an odd deal, since the company had no previous experience in international or offshore drilling. Some observers wondered if Harken's Bush connection had been a factor. But that's not the part of the story we care about at this moment.
In June of 1990, Bush sold two-thirds of the Harken stock he had received in the Spectrum 7 deal--and collected $318,430 more than it was worth when he first obtained it. Get low, sell high? Anything wrong with that? The month before this sale, Harken appointed Bush to a committee to determine, as Ivins and Dubose put it, "how restructuring [of the firm] would affect ordinary shareholders." According to Ivins and Dubose, who note the previous reporting work of "U.S. News and World Report," when Bush served on this committee, he was privy to information indicating the company was in trouble. He then dumped his stocks before this news became public. "U.S. News" concluded that at the time of the sale there was "substantial evidence to suggest that Bush knew Harken was in dire straits."
Bush claims he had merely sold at an opportune time, when word of the Bahrain deal was bolstering the company's position. But he then neglected to notify the Securities and Exchange Commission of his stock-dump, as he was required to do. Is that the tip-off something was amiss? (He filed the appropriate paperwork eight months after the deadline.) In the meantime, two months after he sold his shares, Harken stock dropped 25 percent, and it would sink further in the months ahead. As Ivins and Dubose note, "three years later, during his 1994 race against [Texas Governor] Ann Richards, he claimed he had filed the required report and that the SEC must have misplaced it. SEC spokesman John Heine told 'Time' that no one at the agency ever found any lost document."
Did Bush, one of the captains of Harken, jump that sinking ship because he had inside information the vessel was foundering? The chronology is suspicious. Yet now he is shocked, shocked that his close friend Ken Lay engaged in the same pattern of behavior. Perhaps if Ken Lay ever does permit himself to be questioned by a Congressional committee an additional query ought to be added to the list above: Did George W. Bush ever offer you advice on how to betray the shareholders of your own company by selling stock in response to bad-news known only to insiders?
He sure didn't leave the Democrats much room to maneuver. When George W. Bush delivered his first State of the Union address--a two-ply speech divided between a so-called war on terrorism and a supposed war on the recession--he depicted himself as a Rooseveltian president, as in both (Republican) Teddy and (Democrat) Franklin Delano.
In Speech One, Bush warned the war on terrorism--now targeting "tens of thousands of trained terrorists" throughout the world, in jungles and in cities--has only just begun and may extend for years beyond his time in office, and he declared himself a roughrider ready to take this war to nations that are "threatening America or our friends and allies with weapons of mass destruction." Never referring to Osama bin Laden by name, he announced that North Korea, Iran and Iraq--especially Iraq--were in his crosshairs and noted, "I will not wait on events, while dangers gather. I will not stand by, as peril draws closer and closer." In other words, if those wimpy coalition partners don't have the stomach for this, if Americans, as heroic as they were on and after September 11, are not be ready to invade Baghdad, none of that will matter. Bush will still lead the charge.
In Speech Two, he came across as a New Dealer. Without providing details, he called for extending unemployment benefits and direct assistance for health care coverage, for strengthening Head Start and early child development programs, for enhanced teacher training and recruitment, for a Patient's Bill of Rights, for extending Medicare to include coverage of prescription drugs, for protection of 401(k) plans and pension fund protection (without mentioning a certain belly-up energy company), for greater accountability within corporate America. He said he was in full favor of "jobs." There was no standard-fare GOP rhetoric about the need to limit big-government or the wonders of unfettered, entrepreneurial capitalism.
This was calculation, not conversion. Taking a cue from Bill Clinton, Bush has learned the value of strategically appropriating portions of the rhetoric and policies of his foes. His Medicare drug prescription plan is meager. It would devote about $77 billion for medication for only the poorest of senior citizens. Even Republican House Speaker Dennis Hastert has suggested spending $300 billion in this area. His Patient's Bill of Rights? Bush, no surprise, didn't say how far he is willing to go in permitting consumers to sue HMOs. And while he urged the lawmakers sitting before him to work "on these important domestic issues in the same spirit of cooperation we have applied to our war against terrorism," Bush was not above sticking it to the Democrats by pressing those items that cause them to see red: ballistic missile defense, Social Security privatization, a pro-industry energy bill that plunders the Alaskan wilderness, and his tax cuts. (He asked Congress to make the ten-year tax-cut legislation passed last year permanent.)
Karl Rove and Company could be proud of the speech, for it provided few openings to the opposition. One cliche among Washington commentators has long been that the Republicans are the Daddy Party (the warriors, the tough-on-crime guys) and the Democrats are the Mommy Party (the gang that worries about health care, education, and such.) Bush was striving to be both Ma and Pa. Seeking the holy grail of most presidents--a strategic political realignment--Bush is attempting to turn the GOP into the Both Parents party, which smites enemies abroad and then tucks you in when the economy falters.
The Democrats have already signaled they have no intention of undermining Bush's daddy credentials. So far they have pledged no-questions-asked loyalty to Bush as the commander-in-chief. Will any prominent Dems now challenge Bush on his intention to expand--unilaterally, if need be--the war on terrorism, or on his blank-check attitude toward military spending? Regarding foreign policy matters, Bush has rendered it tougher for the Democrats by making sure not to sound only like a go-it-alone militarist. He pledged to double the size of the Peace Corps, as part of an initiative to create a USA Freedom Corps, which, he said, "will expand the good efforts" of AmeriCorps. Thus, Bush was celebrating and building upon the accomplishments of John Kennedy and, yes, Bill Clinton. And he even got a bit Wilsonian. He loftily remarked, "America will always stand firm for the non-negotiable demands of human dignity: the rule of law, limits on the power of the state, respect for women, private property, free speech, equal justice, and religious tolerance. America will take the side of brave men and women who advocate these values around the world--including the Islamic world." Now there's something for the princes of Saudi Arabia to consider, as well as Bush's not-so-freedom-loving allies in Turkey and Uzbekistan. The President just placed the United States on the side of dissidents in these nations and elsewhere. Was he serious? (Don't email me; that's a rhetorical question.)
So what was House minority leader Dick Gephardt to do when he delivered the Democratic response to Bush's speech? He surgically attached his party to the President on matters of war and homeland protection. (There is "no daylight between us" on the war of terrorism, he assured the public.) And when he offered the Democrat's domestic agenda, it did not seem that distant from what Bush had proposed: helping the unemployed, recruiting high-quality teachers, protecting pensions. Gephardt, of course, referenced that particular energy company.
There were a few differences. Gephardt advocated raising the minimum wage and providing a tax deduction for the first $10,000 spent on college tuition. He took a glancing shot at Bush by opposing "gambling" on Social Security privatization. And he cried out for campaign finance reform. But Gephardt presented little to distinguish Democrats from Bush in a meta way. Confronting a wartime president with an approval rating somewhere in the area of 137 percent, Gephardt and other Democrats cannot bring themselves to bash Bush as a tool of Big Bidness--or a conservative ideologue or anything else. Gephardt did not question Bush's intentions or overall aims. He did not even mention the tilted-to-the-rich tax cuts Bush rammed through Congress.
Perhaps Democrats are hoping that in this election year Americans who vote will eventually pay sufficient attention to the policy fights of Washington to conclude the Democrats are indeed the better mommies and that voters will believe that even during a war economic concerns come first. But with the Democrats praising Bush's performance as a daddy, and with Bush using his wartime-enhanced standing to score points as a mommy, there is not much of a contest at the moment between Bush and the Democrats.
"Those of us who have lived through these challenging times have been changed by them," Bush said toward the end of his address. That surely is true for him. As crass as it may be to suggest, he was lucky September 11 happened on his watch. (It's easy to believe those post-9/11 reports that quoted Clinton saying he wished he had been confronted with such a tragedy.) But, as this speech demonstrated, Bush--now an amalgamation of TR, WW, FDR, JFK, WJC and (don't forget) RR--and his posse have been damn smart in figuring out how to make the most of it