Bush Aide Was Told of Enron's Plea
Although Evans said he TALKED TO BUSH IN NOVEMBER about
Enron's plight, the commerce secretary said he "never talked to him about the fact that
I had received a phone call."
By Dana Milbank
Washington Post Staff Writer
Monday, January 14, 2002; Page A04
President Bush's chief of staff [CARD] was told last fall of Enron Corp.'s request
for government help before the giant energy
company collapsed in the largest bankruptcy case ever in the United States,
the administration said yesterday.
Commerce Secretary Donald L. Evans said he told
White House Chief of Staff Andrew H. Card Jr. about a call he received
from Enron Chairman Kenneth L. Lay. In the call, Lay expressed hopes that the government
would intervene with a private credit agency that was threatening to lower its rating on
Enron's debt, seriously jeopardizing the company's financial
viability. Evans said the government did not intervene.
It was the first indication that, at the time, officials in the White House had been
informed of Enron's desire for government intervention. White House spokesmen
had said Bush and Vice President Cheney did not learn of the conversations until last week.
White House press secretary Ari Fleischer had said on
Thursday that "there's nobody here that I'm aware of" who
was consulted.
Evans said he informed Card of the Oct. 29 conversation "several weeks" later, when
Enron was negotiating a merger with Dynegy Inc.
"With all the ongoing and continuing activity at Enron and Dynegy, I thought the White House
ought to know," Evans said yesterday on NBC's "Meet the Press." "I was over there one day,
and I stepped into Andy Card's office and told him I'd
received this call. He simply listened to me and said, 'Thank you very much.' "
Evans said Card did not pass the information on to Bush. Although Evans said
he talked to Bush in November about Enron's plight, the commerce secretary
said he "never talked to him about the fact that I had received a phone call."
Evans and Treasury Secretary Paul H. O'Neill both spoke with
Lay last fall about Enron's dire financial condition. Lay had "six to eight"
conversations with Treasury Undersecretary Peter Fisher, who was asked to call
Enron's lenders about extending the firm's credit.
Treasury officials said they talked to lenders about the likely impact of an Enron collapse
but did not request any action. Former Clinton treasury secretary Robert E. Rubin telephoned
Fisher about intervening with the bond-rating agency.
Enron's collapse and Dec. 2 bankruptcy filing wiped out the pensions and savings of
thousands of workers. The Justice Department opened a criminal investigation into the collapse,
and several congressional committees are investigating. The company's auditor, Arthur Andersen, is under investigation for destroying thousands of records related to Enron.
Time magazine reported yesterday that Andersen ordered employees in an Oct. 12
memo to destroy all Enron audit
material except the most basic "work papers."
Evans also said that he has talked about Enron with Lawrence B. Lindsey,
Bush's top economic adviser and a former Enron consultant, and with Card deputy
Joshua Bolten "from time to time." But Commerce spokesman Jim Dyke said Evans did
not mention Lay's phone call to them.
Sen. Joseph I. Lieberman (D-Conn.), chairman of the Governmental Affairs Committee,
said his panel's investigation into Enron's collapse would also look at the administration's
actions.
"We know that Mr. Lay and other executives of Enron were right in the middle
of the formulation of the Bush administration energy policy and energy appointments
that were made," Lieberman said on CBS's "Face the Nation." "But we don't know enough
to know whether any of that influence in any way stopped the administration or agencies of our
federal government from protecting average shareholders who lost their life savings when
Enron collapsed."
But Evans said it would have been an "egregious abuse of the office" for him to have acted.
O'Neill, appearing on "Fox News Sunday," said it was Enron's duty to alert shareholders
and employees to the condition of the company and "not a federal government responsibility."
O'Neill said the collapse was not surprising.
"Companies come and go," he said. "Part of the genius of capitalism is people get to make good
decisions or bad decisions, and they get to pay the consequences or to enjoy the
fruits of their decisions."
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