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On Capitol Hill, Enron's Fall Was Felt at the Personal Level
By Juliet Eilperin
Washington Post Staff Writer
Saturday, June 15, 2002; Page A05
Enron Corp.'s collapse last year hit members of Congress in a couple of places: where they make policy for the nation, and where they make -- or lose -- money for themselves.
The fall into bankruptcy by the Houston-based energy firm ignited high-profile hearings and a broad debate over corporate responsibility. Meantime, it quietly clipped several lawmakers who sold or held Enron stock as its value plummeted, according to financial disclosure reports released yesterday.
Each member of Congress must file the reports annually, and they provide a rare peek into legislators' personal lives. They reveal not only their assets and stock trades, but also what gifts they received and money they earned on the side. While members tend to be worth much more on average than their constituents, the reports show they are not immune to Wall Street's vagaries.
Sen. Mike DeWine (R-Ohio) lost at least $20,000 in Enron stock trades. Sen. Jon Kyl (R-Ariz.) bought 185 Enron shares for more than $1,600 and sold them for $125 the day after the company declared bankruptcy.
Rep. Joe Barton (R-Tex.), who chairs the Energy and Commerce subcommittee on energy and air quality, bought $4,500 worth of Enron stock last fall when its shares were worth $9 and its prospects for a merger with Dynegy Inc. were bright. By the time he sold the 500 shares on Dec. 31, they were worth $895.
Barton said yesterday he still has "more than I want to admit" in Enron stock, and noted that his son Brad -- a financial analyst -- warned him against the investment.
"I showed I could lose money with the best of them," he said in an interview, adding that he had learned his lesson. "It shows the market works, and the market goes up and the market goes down." Other Enron losers included Rep. Jim Kolbe (R-Ariz.), Rep. Carolyn McCarthy (D-N.Y.), Rep. Gary Miller (R-Calif.), Rep. C.L. "Butch" Otter (R-Idaho) and Sen. Phil Gramm (R-Tex.).
Enron owes Gramm's wife, Wendy, between $500,000 and $1 million for serving on its board of directors. By contrast, Becky Whetstone -- wife of Rep. Charlie A.Gonzalez (D-Tex.) -- lost only $30 in a series of Enron stock transactions that began in February 2000 and ended by August 2001.
Some lawmakers suffered their losses elsewhere. Rep. Johnny Isakson (R-Ga.) lost money in Qwest Communications and Global Crossings investments. Both companies tanked amid allegations of impropriety.
On a broader scale, yesterday's disclosures reinforced the Senate's image as a millionaire's club. While lawmakers are compelled to list their assets only within wide ranges, the rough approximations provide a picture of their means.
Sen. Peter Fitzgerald (R-Ill.) reported between $26.3 million and $52.8 million in assets, while Sen. Mark Dayton (D-Minn.), a department store heir, holds as much as $13 million.
A few Democratic presidential contenders listed healthy portfolios as well. Sen. John Edwards (N.C.), a former trial lawyer, has at least $7.3 million and possibly as much as $33.6 million, most of it in a blind trust. Teresa Heinz, the wife of Sen. John Kerry (Mass.), has assets exceeding $500 million.
Sen. Jon Corzine (D-N.J.), a past chairman of Goldman Sachs who spent tens of millions of dollars to win his seat in 2000, reported one investment held in a blind trust worth at least $50 million. He valued four others at between $5 million and $25 million each. In August, his wife Joanne sold their Park Avenue condominium for at least $5 million.
Lawmakers do not have to disclose the value of their salary, federal pensions, primary residence, or checking accounts and savings accounts worth less than $5,000. That leaves some House members with little to report.
Rep. Bill Thomas (R-Calif.), who influences trillions of dollars in federal funds as chairman of the House Ways and Means Committee, listed no assets or liabilities. Prominent liberals Cynthia McKinney (D-Ga.) and Lynn Rivers (D-Mich.) did the same, while fellow progressive Rep. Dennis Kucinich (D-Ohio) listed more in loans than in assets.
"Government of the people occasionally means that some representatives may, in fact, just like their constituents, live paycheck to paycheck," Kucinich said. "My constituents are my assets."
For the most part, House and Senate leaders are not nearly as rich as most of their rank-and-file colleagues. House Speaker J. Dennis Hastert (R-Ill.) reported between $405,000 and $1 million in assets. House Minority Leader Richard A. Gephardt (D-Mo.) holds between $134,000 and $610,000 in 26 stock funds, but owes between $65,000 and $150,000 in student loans for his children.
House Majority Leader Richard K. Armey (R-Tex.), who is retiring this year, listed no assets but reported a line of credit at Wells Fargo Bank ranging between $15,000 and $50,000.
The recent ascension of House Minority Whip Nancy Pelosi (D-Calif.) has dramatically boosted the House leadership's overall wealth. She reported assets of at least $23.2 million.
Much of Pelosi's wealth stems from her husband, Paul, an investment banker. Pelosi, known for showering her aides and colleagues with gourmet meals, frequently quips at the outset, "Thank God for Paul Pelosi!"
Pelosi's assets include not only her D.C. waterfront apartment, worth at least $1 million, but also a $1 million to $5 million investment in the Napa Valley resort Auberge du Soleil; money in a golf resort; stock in Salon.com and Guru.com; and homes and investments in two Napa vineyards worth at least $6 million.
Even less wealthy members found ways to earn extra cash. GOP Conference Chairman J.C. Watts (Okla.) took in $21,357 last year by performing ministerial duties and Sen. Joseph I. Lieberman's wife, Hadassah, made $328,000 giving speeches to Jewish audiences. The Leibermans are writing a book about the 2000 presidential campaign, for which they've received a $13,500 advance.
Other Senate authors included Paul D. Wellstone (D-Minn.), who received a $20,000 advance for "The Conscience of a Liberal: Reclaiming the Compassionate Agenda." Sen. John McCain (R-Ariz.) received $67,000 in royalties for his family history, "Faith of My Fathers."
Sen. James M. Jeffords (I-Vt.) received a $125,000 advance from Simon and Schuster to write last year's "My Declaration of Independence," which explained his decision to quit the GOP, as well as an autobiography set for release this fall.
Several politicians took star turns last year, according to the disclosure reports. GOP Sens. Charles E. Grassley (Iowa) and Orrin G. Hatch (Utah) received $1,000 each for their cameos in the movie "Traffic." Sen. Kay Bailey Hutchison (R-Tex.) pocketed $1,000 for her appearance in the made-for-television movie "The President's Man."
At least six House members -- Otter, Harold Ford Jr. (D-Tenn.), Jack Kingston (R-Ga.), John Mica (R-Fla.), Juanita Millender-McDonald (D-Calif.) and Loretta Sanchez (D-Calif.) -- appeared on the comedy program "Politically Incorrect" and subsequently donated their honoraria to charity. All but Sanchez received $500 for being a guest. She reported getting $1,000 each for two appearances.
Lawmakers also took pains to describe some of the more unusual gifts they received. Senate Assistant Majority Leader Harry Reid (D-Nev.) received an intricately hand-woven leather whip from Eleanor Volkmar, an old friend. Rep. John Shimkus (R-Ill.) listed more modest gifts, including a right-hand garden glove and two packets of sunflower seeds.
Rep. Sanford D. Bishop Jr. (D-Ga.), who got married May 26, 2001, received a waiver from the House ethics committee for reporting gifts worth less than $260. The panel urged Bishop, however, to "exercise caution in accepting any gift that likely would not have been offered but for your status as a Member of the House."
The reports also provided an epilogue for the travails of Rep. Gary A. Condit (D-Calif.), who lost his seat after his relationship with murdered intern Chandra Levy became public. He sold his Adams Morgan condo last year, netting between $50,000 and $100,000.
Senior White House officials also filed disclosure forms yesterday. Karl Rove, Bush's senior adviser, sold at least $996,000 in stock on June 7, 2001, three weeks after Bush had announced his energy plan. The sale included at least $50,000 in Enron stock.
Rove's sales included stock valued at $100,000 or more in Intel Corp., Johnson & Johnson and the former USA Education Inc. (commonly known as Sallie Mae) and Wells Fargo & Co. A senior administration official disclosed the sale at the time, and said Rove had wanted to sell his stocks earlier but had been stopped by the White House counsel's office.
Staff researchers Lynn Davis, Brian Faler, Madonna Lebling, Lucy Shackelford and Margaret Smith, and staff writers Helen Dewar and Jim VandeHei contributed to this report. |
