Bush and Democrats Disputing Ties to Enron
" Mr. Lay and Mr. Bush appeared to develop a warm
relationship during Mr. Bush's tenure as governor. In
April 1997, on Mr. Lay's 55th birthday, Mr. Bush sent
him a joking note: "One of the sad things about old
friends is that they seem to be getting older - just like
you! 55 years old. Wow! That is really old."
(For photographs of the above letter, see see the first page of today's Business Section in New York Times) On today's business page there is a photograph of a second letter from Lay to W that was dated December 21, 1999. Here are excerpts from that letter, Lay wrote:
Dear George and Laura,
Linda and I want to thank you for the 'Tejano Santa print."….."It was so thoughtful of you to send it to us, and it is a gift we will treasure"…
(Lay concludes the letter with a handwritten note to George and Laura.)
The New York Times
January 12, 2002
THE RELATIONSHIPS
By RICHARD A. OPPEL Jr. and DON VAN NATTA Jr
With the Justice Department
and Congress ratcheting
up investigations into the Enron
Corporation President Bush is seeking to play
down his relationship with
Enron's embattled chairman,
Kenneth L. Lay. But their ties are
broad and deep and go back
many years, and the relationship
has been beneficial to both.
In the Oval Office on Thursday,
Mr. Bush said that Mr. Lay "was a
supporter of Ann Richards in my
run in 1994" for governor of Texas
and that he first got to know Mr.
Lay after that race.
But Mr. Lay appears to have been
a bigger supporter of Mr. Bush in
that race, as he and his wife,
Linda, contributed $37,500 to the
Bush gubernatorial campaign -
three times the amount,
according to a database
maintained by The Dallas
Morning News, that they donated
to Ms. Richards. Mr. Lay has also
told interviewers that prior to that
election he had become "very
close" to Mr. Bush.
Since the two men met over a
decade ago, Mr. Lay and his
company have been the most
generous campaign donors in Mr.
Bush's political career. At the
same time, Mr. Bush was a strong
advocate of many of the issues most important to Enron,
like deregulating electricity markets and curbing large
civil jury awards.
In all, Enron and Mr. Lay have given more than $550,000
to Mr. Bush's various campaigns. And for the
Bush-Cheney inaugural, Enron, Mr. Lay, and the former
Enron chief executive, Jeffrey Skilling, EACH donated
$100,000, according to the Center for Responsive Politics.
Last year, Mr. Lay met with Vice President Dick Cheney,
who was heading a task force on energy policy. The task
force's recommendations conformed with much of what
the company had sought in its meeting with Mr. Cheney
- but they were also positions embraced by others in
industry and government.
With the collapse of Enron amid an accounting scandal,
Democrats are seeking to make Mr. Bush's friendship
with Mr. Lay into a political liability. The White House, in
turn, in seeking to distance the administration from both
Mr. Lay and Enron, has said that officials spurned Mr.
Lay's personal entreaties for assistance as Enron faltered
late last year.
Backers of Mr. Bush note there has never been a showing
that Mr. Bush altered any policy solely to satisfy Mr. Lay.
And at times, Mr. Bush has taken positions adverse to
Enron, like backing away from curbing carbon dioxide
emissions, an idea backed by Enron, which sought to
generate new business through trading emissions credits.
On Thursday, after the disclosure that the Justice
Department had created a task force to pursue a criminal
investigation of Enron, Mr. Bush told reporters he "first
got to know" Mr. Lay after being elected governor in 1994.
In that race, Enron, Mr. Lay and other Enron executives
were significant contributors to Mr. Bush, donating a total
of $146,500 to Mr. Bush, according to Texans for Public
Justice, a group that tracks campaign contributions.
At the time, Mr. Lay was already serving on an advisory
body, the Governor's Business Council, that was created
by Ms. Richards. Mr. Bush said on Thursday that after he
defeated Ms. Richards he kept Mr. Lay on the advisory
panel. "I decided to leave him in place, just for the sake of
continuity."
Craig McDonald, director of Texans for Public Justice, said
yesterday, "President Bush's explanation of his
relationship to Enron is at best a half truth. He was in bed
with Enron before he ever held a political office."
Scott McClellan, a White House spokesman, challenged
that characterization last night. "The White House has
clearly noted that Mr. Lay has been a supporter," Mr.
McClellan said. "But Mr. Lay was a supporter of Ann
Richards during the 1994 race, and public campaign
records clearly reflect his support."
In an interview last year with The New York Times
and the PBS program "Frontline
" Mr. Lay characterized his relationship with
the Bush family as "very close," adding that the race
between Mr. Bush and Ms. Richards placed him in "a little
difficult situation."
"I'd worked very closely with Ann Richards also, the four
years she was governor," he said in the interview. "But I
was very close to George W. and had a lot of respect for
him, had watched him over the years, particularly with
reference to dealing with his father when his father was in
the White House and some of the things he did to work for
his father, and so did support him."
By the late 1980's, Mr. Lay, an economist by training, had
become a major force in Houston business and social
circles as chief executive of Enron, then primarily a
natural gas pipeline operator. He also became a
significant fund-raiser for Mr. Bush's father and was
working to bring the Bush presidential library to Houston.
In that time, Mr. Lay has said, he got to know the younger
Mr. Bush. "That's when I probably spent a little more
quality time with George W.," he told The Morning News.
Later, Mr. Lay was picked to head the host committee for
the 1992 Republican convention in Houston.
But while both Mr. Lay and Enron have historically given
far more money to Republicans, they have sought links
with prominent Democrats, too. One was President Bill
Clinton, who has golfed with Mr. Lay. Another was Ms.
Richards, who appointed Mr. Lay to her business advisory
panel.
"We knew at the time that he had a close relationship with
Bush," said John Fainter, who served as Ms. Richards's
chief of staff in 1993 and 1994. Mr. Lay was a good pick
for the panel, he said, because of his involvement in the
Houston civic and business community.
But Mr. Fainter, who runs the electric utility industry's
lobbying group in Texas, added: "To say he inherited Ken
Lay from Ann Richards, I don't agree with that. As active
as he was in his father's presidential campaign, he would
have known him."
Ms. Richards did not return a telephone call yesterday,
but in a written statement she confirmed that Mr. Lay
donated to her 1994 campaign and said that he did "a
very good job" while serving as chairman of the Governor's
Business Council.
As governor, Mr. Bush was an advocate of the issue most
important to Mr. Lay and Enron, deregulating the utility
business. Mr. Bush also appointed Patrick H. Wood III to
be chairman of the Texas Public Utility Commission, an
appointment that Mr. Lay had recommended. Mr. Wood is
now chairman of the Federal Energy Regulatory
Commission, where he oversaw and supported the
imposition last year of electricity price restraints in
California opposed by Enron and other unregulated power
companies.
Mr. Lay and Mr. Bush appeared to develop a warm
relationship during Mr. Bush's tenure as governor. In
April 1997, on Mr. Lay's 55th birthday, Mr. Bush sent
him a joking note: "One of the sad things about old
friends is that they seem to be getting older - just like
you! 55 years old. Wow! That is really old."
Mr. BUSH also has done FAVORS for Mr. LAY, such as later
that year when, at Mr. Lay's request, he called TOM RIDGE,
then the governor of Pennsylvania and now the director of
Homeland Security, to vouch for Enron , which was trying
to break in to that state's electricity markets.
But to one Enron official, Mr. Lay swaggered less after Mr.
Bush's presidential victory than some other senior Enron
executives who liked to brag about the company's ties to
the new administration.
"Ken Lay didn't advertise his connections," the official
said, "but some of the Enron officials around him did
because they didn't have those connections."
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