Clinton Repaid Enron With $1 Billion in Subsidized Loans
Phil Brennan
Democrats have hoped the Enron scandal would tar the Bush administration, but as investigators dig deeper it's the Clinton administration and the Dems who are emerging as the villains of the piece.
The Washington Times reported Thursday that the Clinton administration coughed up more than $1 billion in taxpayer-subsidized loans to Enron Corp. just when the energy giant was kicking in almost $2 million for Democrat causes. And as we have previously reported, to help persuade then-President Bill Clinton to push the disastrous Kyoto Protocol, Enron gave $420,000 to Democrats.
Times reporter Patrice Hill writes that, according to the Export-Import Bank and the Overseas Private Investment Corp., the agencies that provided the subsidies, the Clinton administration turned down only one out of 20 Enron projects to build power plants, natural-gas pipelines and other "big-ticket energy facilities" between 1993 and 2000.
Moreover, the Clinton administration, "which lauded Chairman Kenneth L. Lay as an exemplary 'corporate citizen,' granted about $200 million worth of insurance against political risks for nine Enron projects in such politically volatile areas as Argentina, Venezuela and the Gaza Strip, according to documents the agencies provided to the Senate Finance Committee."
"These projects obviously were a tremendous benefit to Enron's operations," Sen. Charles Grassley, R-Iowa, ranking minority member of the committee, told the Times. The Reagan and Bush administrations approved not a single loan for Enron between 1985 and 1992 and provided insurance for only one Enron power project in Guatemala in 1992, he noted.
On the other hand, the Clinton administration made three loans between 1994 and 1998 to the now-defunct Dabhol power project in India. Ron Brown, Clinton's commerce secretary, bragged about the approval of the Dabhol loans during a trade mission to India in 1995, while Lay stood by his side.
The Times noted that the junket was "one of 11 Clinton trade missions provided at taxpayer expense for corporate executives from Enron and other companies." Moreover, the U.S. Trade and Development Agency, which sponsored the trips, also coughed up $1 million in funding to study Enron energy projects in Russia, Eastern Europe and former Soviet states.
While Democrats go rooting around trying to find any single indication that Lay was somehow in cahoots with the Bush administration, evidence of his links to the Clinton administration is popping up all over the place.
Another Renter of the Lincoln Bedroom
Lay not only was a golfing partner of Clinton, he even slept in the Lincoln Bedroom. Other members of Enron's top executive echelon attended the White House's infamous "coffee klatches" hosted by Clinton, according to published reports.
Lay offered a seat on Enron's board of directors to Robert Rubin, Clinton's Treasury secretary, in 1999 just before he left office, according to an Associated Press report Thursday. It turns out that Rubin, being paid an astonishing $40 million a year by Enron creditor Citigroup, tried to get the Treasury Department to intervene for Enron last fall when the company's credit rating was threatened.
In May 1996, Clinton touted Lay as being a good "corporate citizen" at a White House event because of Enron's alleged enlightened personnel policies, including profit-sharing of Enron stock and generous health and pension benefits. As the Times noted, Enron employees now are suing because those benefits proved as worthless as the bankrupt company's stock.
The Times reported that according to Federal Election Commission records, during the Clinton administration Enron kicked in more than $1 million to the Democrat party, including $600,000 to the Democratic National Committee. Clinton and Vice President Al Gore got contributions of $11,000 and $13,750, respectively, for their presidential campaigns.
Enron made a $100,000 contribution to the DNC just before India gave final approval to Enron's Dabhol project in June 1996. According to the Times, Dabhol, the largest and most expensive capital project ever undertaken in India, was of dubious economic value and never went on line.
After looking at the Dabhol project, the World Bank declared said it was not economically viable and of inordinate benefit to Enron, which had a 65 percent stake in the project. Enron still owes $203 million on an Export-Import Bank loan for the project, which the bank says is covered by guarantees provided by five Indian banks.
Congressional aides told the Times it was not clear what the taxpayers' liability will be for that and other loans now that Enron is bankrupt. The Export-Import Bank said its loans were extended to overseas subsidiaries of Enron and not the bankrupt corporation. The overseas investment agency said its exposure was limited to paying any missed premiums on Enron's political risk insurance.
Top Clinton officials lobbied personally to obtain Indian state guarantees for the Dabhol project after it ran into problems in 1995. White House chief of staff Thomas F. "Mack" McLarty made it a top administration priority to keep the project from failing. The Bush administration has continued efforts to salvage the project. After leaving the White House, McLarty did work for Enron.
Hazel O'Leary, Clinton's energy secretary, led a number of missions to India, and Frank Wisner, Clinton's ambassador to India, was ordered to keep the project afloat. After Wisner left government in 1997, he joined the board of directors of a company then controlled by Enron.
The Clinton administration's ties to Enron don't stop there: |
