Bush to Sign Corporate Reform Bill on Tuesday
President Warns Executives of Arrest Plans
washingtonpost.com
By Mike Allen
Washington Post Staff Writer
Monday, July 29, 2002; 1:51 PM
CHARLESTON, S.C., July 29--President Bush warned corporate executives today that his administration plans to make more arrests after he signs a bill increasing the penalties for accounting fraud.
The corporate-responsibility bill, which was introduced by Senate Democrats and endorsed by Bush as the number of board-room scandals multiplied, sets rigid new standards for accounting firms and the chief executive officers of public companies.
"If you're a CEO and you think you can fudge the books in order to make yourself look better, we're going to find you, we're going to arrest you and we're going to hold you to account," Bush told an audience in the West Ashley High School gymnasium this morning.
For the bill-signing ceremony, the White House plans a large East Room event which will include members of Congress, officials of the Justice Department and Securities and Exchange Commission, and members of the corporate fraud task force that Bush announced during his Wall Street speech early this month.
Bush's sky-high approval rating has eroded against the backdrop of the gyrating stock market and a barrage of disclosures about boardroom malfeasance. Besides embracing the corporate-governance legislation, Bush has tried to restore investors' confidence by pointing to all the promising measures of economic health. At a fund-raising luncheon after his speech at the high school, Bush said he is "optimistic about the economic future," and pushed back at Democrats' contention that the tax cut he championed has driven the government back to deficit spending.
"I believe the fundamentals are strong for economic growth," he said. "After all, inflation is down and interest rates are low. We've got wise monetary policy. I strongly believe the fiscal policy we put in place--giving people some of their own money back, so they can spend it as opposed to the government--made eminent sense for economic vitality and job creation."
White House press secretary Ari Fleischer, when asked whether Bush had revised his view that the corporate problems were the result of a few bad apples, cautioned reporters against "equating a refiling of earnings with a bad apple--one does not necessarily mean the other."
"But the president does believe that what's happened with criminal wrongdoing is a few bad apples, and those bad apples are going to be put where bad apples belong--in the jail," Fleischer said.
The luncheon Bush attended raised $1 million for Mark Sanford, a Republican challenging Gov. Jim Hodges (D) this fall, as well as $200,000 for the South Carolina Republican Party.
Before his speech at the high school, Bush conducted a roundtable on welfare reform, featuring several people who had successfully moved from welfare to work. For the second trip in a row, the White House closed Bush's off-the-cuff policy discussion to reporters. A roundtable he held about medical malpractice law in High Point, N.C., on Thursday, also was closed to reporters, and the White House did not make available a transcript, as it often does after a presidential event where the press corps cannot be accommodated.
Asked on Air Force One today why the welfare roundtable was behind closed doors, Fleischer, said, "I'll be happy to talk about that off the record." He did not elaborate.
The White House, always eager to portray Bush as hands-on, announced that he had called seven members of Congress on Friday afternoon and in the early hours of Saturday as the House vote neared on trade negotiating authority, including a call to one member at 2:20 a.m. The vote--an important victory for the administration, by 215 to 212 – was finished at 3:30 a.m. and Bush spoke 10 minutes later to Nicholas E. Calio, his director of legislative affairs. They had talked more than a dozen times, Fleischer said.
In a small embarrassment for the White House, Bush forgot to recognize Sanford--whose candidacy was the main reason for the trip--at the beginning of his speech at the high school. Bush made up for it at the luncheon by praising him effusively as "a good one," even though Sanford had supported Sen. John McCain (R-Ariz.), Bush's rival in the crucial South Carolina primary. McCain's weak showing doomed his candidacy.
"I've got a lot of fond memories here, if you know what I mean," Bush said, drawing chuckles.
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