The Road to Perdition
By FRANK RICH
Wagging the dog no longer cuts it. If the Bush administration wants to distract Americans from
watching their 401(k)'s go down the toilet, it will have to unleash the whole kennel.
Maybe only unilateral annihilation of the entire axis of evil will do. Though the fate of John Walker Lindh was
once a national obsession, its resolution couldn't knock Wall Street from the top of the evening news this
week. Neither could the president's White House lawn rollout of his homeland security master plan. When
John Ashcroft, in full quiver, told Congress that the country was dotted with Al Qaeda sleeper cells "waiting
to strike again," he commanded less media attention than Ted Williams's corpse.
What riveted Americans instead was the spectacle of numbers tumbling as the president gave two speeches
telling us help was on the way. For his first pitch, he appeared against a blue background emblazoned with
the repeated legend "Corporate Responsibility." Next came a red backdrop, with "Strengthening Our
Economy" as the double-vision-inducing slogan. What will be strike three — black-and-white stripes and
"Dick Cheney Is Not a Crook"? Maybe this rah-rah technique helped boost the numbers back when
George W. Bush was head cheerleader in prep school. But he's not at Andover anymore. Where his father's
rhetoric gave us a thousand points of light, his lopped a thousand points off the Dow.
Once the market dissed him, the president waxed philosophical, if not Aristotelian, professing shock that his
fellow citizens would care about something as base as money. Invoking Sept. 11, he said, "I believe people
have taken a step back and asked, `What's important in life?' You know, the bottom line and this corporate
America stuff, is that important? Or is serving your neighbor, loving your neighbor like you'd like to be loved
yourself?"
Easy for him to say. It's hard to engage in lofty meditation about loving your neighbor if your neighbor is
Kenneth Lay or Gary Winnick or Bernard Ebbers or any other insider in "corporate America stuff" who
escaped with multimillions just before the corporation cratered, taking your job or pension or both with it.
Democrats celebrate the Republicans' travails as if it were Christmas in July. But the party's chief, Terry
McAuliffe, was a Winnick crony who made his own killing before Global Crossing tanked, and its most
visible presidential candidate, Joseph Lieberman, is fighting to the political death for loosey-goosey
stock-option accounting. Just as the Harken-Halliburton stories gathered fuel, such tribunes of the people as
Tom Daschle, Hillary Rodham Clinton and John Kerry boarded corporate jets supplied by companies like
Eli Lilly and BellSouth to rendezvous in Nantucket with their favor-seeking fat cats.
But the hypocrisies of the Democrats, however sleazy in their own right, do not cancel out the burgeoning
questions about this White House. Each time Mr. Bush protests that only a few bad apples ail corporate
America, that mutant orchard inches closer to the Rose Garden. If there's not a systemic problem in
American business, there does seem to be one in the administration, and it cannot be cordoned off from the
rest of its official behavior. Compartmentalization, Republicans of all people should know, went out of style
with the Clinton administration.
In the real world, everything connects. What is most revealing about Mr. Bush's much-touted antidote to the
bad apples, his "financial crimes SWAT team," is how closely it mimics Enron's Cayman Island shell
subsidiaries. It exists mainly on paper, as a cutely named entity with no real assets. It calls for no new
employees or funds and won't even gain new F.B.I. agents to replace those whom the bureau reassigned
from white-collar crime to counterterrorism after Sept. 11.
The SWAT team's main purpose is to bolster the administration's poll numbers as the Enron off-the-books
partnerships did its corporate parent's stock price. And like its prototypes, it may already be going south.
No sooner did the SWAT team's chief, Deputy Attorney General Larry Thompson, hold his first photo op
than The Washington Post revealed that he was an alumnus of yet another bad apple, the credit-card giant
Providian. Mr. Thompson had headed the board's audit and compliance committee and escaped with $5
million before the company threw thousands of employees out of work and paid more than $400 million to
settle allegations of consumer and securities fraud.
Even the war on terrorism is not immune from Enron-style governance by this administration. Last weekend
Jeff Gerth and Don Van Natta reported in The Times that the Halliburton unit KBR got a unique sweetheart
deal with the Army last December, despite being a reputed bill-padder and the target of a criminal
investigation. Why? Call it the perfect Halliburton-Enron storm. The company grabbing the deal is the
former employer of the vice president. The government agency granting the deal, the Army, reports to the
former Enron executive Thomas White, who is nothing if not consistent: he doesn't protect taxpayers' dollars
any more zealously than he did his former shareholders'.
We still don't know the full extent of our Enron governance because we still don't have a complete list of
former Enron employees hired by the Bush administration. (It hardly inspires confidence to know that one of
them is its chief economic adviser, Lawrence Lindsey, who also offered such valuable wisdom to Ken Lay.)
Nor, of course, do we know the full details of the president's past history at Harken Energy or the vice
president's at Halliburton. Those details matter not so much because of any criminality they might reveal —
we are rapidly learning that there is no such thing as a prosecutable corporate crime anyway — but because
of what they may add to our knowledge of the ethics, policies and personnel of a secretive administration to
which we've entrusted both our domestic and economic security.
What we know about Harken so far is largely due to the S.E.C. documents unearthed and posted since
2000 by the enterprising and nonpartisan Center for Public Integrity, also a leader in uncovering the Clinton
administration's Lincoln Bedroom scandals. "It's Forrest Gump does finance," says Charles Lewis, the
center's founder, in looking at the story line of the remarkable George W. Bush business career. "Every time
he seemed to be in trouble, he would end up with a box of chocolates."
The president's self-contradictory defense of his past is to say he was "fully vetted" by the S.E.C. even
though he still hasn't "figured it out completely" himself. But the S.E.C. never interviewed Mr. Bush during its
investigation. The agency was then run by an appointee of his father, Richard Breeden, who recused himself
from the case. Last Sunday, Mr. Breeden turned up on Fox News as a George W. defender. Yet when
Tony Snow asked him twice if he could give the president "a clean bill of health, yes or no," Mr. Breeden
pleaded ignorance and ducked. Perhaps that's why the White House has not asked the S.E.C. to release its
Harken papers, even though Harvey Pitt last weekend said he would if it did. The president has also told the
press that "you need to look back on the director's minutes" to answer questions about Harken — and then
refused to provide those minutes or to instruct Harken to release them either. But yesterday Mr. Lewis's
organization posted a pile of them at www.publicintegrity.org, and says that more documents are yet to
come.
What is the president hiding? Clearly the story here is not merely a hard-to-prove case of insider trading,
tardy stock-sale forms and Mr. Bush's knowledge of the sham transaction involving Aloha Petroleum. Most
likely it also involves the mystery first raised by The Wall Street Journal and Time in 1991. Back then, their
investigative journalists tried to break the cronyism code by which tiny Harken, which had never drilled a
well overseas, miraculously beat out the giant Amoco for a prized contract for drilling in Bahrain. They also
tried to learn what various Saudi money men, some tied to the terrorist-sponsoring Bank of Credit and
Commerce International, may have had to do with Harken while the then-president's son was in proximity.
These questions, like the companion questions about Halliburton's dealings with Iraq on Mr. Cheney's
watch, are not ancient history but will gain in relevance in direct proportion to the expansion of the war on
terrorism and the decline of the Dow. Sooner or later George W. Bush will have to answer them, because
even though he cares more about loving his neighbors than the bottom line, the rest of us are just
irredeemably crass.
Copyright 2002 The New York Times Company |
