Both Sides Polish Badges to Appear the Best Suited to Fight Corporate Crime
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March 22, 2004
POLITICAL MEMO
By RICHARD W. STEVENSON
The New York Times
WASHINGTON — At a time when Martha Stewart is confronting the likelihood of donning prison orange, when Enron executives are still doing the perp walk and new Wall Street scandals are erupting with regularity, President Bush is working hard to cast himself as the leader of the charge to protect employees and investors from corporate malfeasance.
"We had to confront corporate crimes that cost people their jobs and their savings," Mr. Bush said to cheers in a speech to donors this month at a Houston hotel a dozen blocks from Enron's headquarters. "So we passed strong corporate reforms and made it very clear, we will not tolerate dishonesty in the boardrooms of America."
In raising the issue in nearly every campaign appearance he makes, Mr. Bush is addressing a political challenge that extends well beyond the fallout from the allegations of fraud and other wrongdoing in the executive suites that came to light on his watch.
Senator John Kerry and his Democratic allies are running an unabashedly populist campaign against Mr. Bush, portraying him and Vice President Dick Cheney in speeches and interviews as champions of corporate executives at the expense of working people during a period when the economy is not creating many new jobs.
They start with the personal. They point out that Mr. Cheney, immediately before becoming Mr. Bush's running mate, was chief executive of Halliburton, the oil services giant whose rebuilding contracts in Iraq are under scrutiny by the Pentagon and the Justice Department. And they note at every opportunity that Mr. Bush, a former oilman himself, has always had close ties to business leaders, like Enron's former chairman, Kenneth L. Lay — "Kenny Boy" to the president — who was once one of his most generous donors.
More broadly, Democrats are trying to make a case that this White House is a tool of powerful special interests, supports companies that ship American jobs overseas, allows pharmaceutical makers to gouge consumers, is more interested in corporate bottom lines than environmental protection and backs management over unions.
At a forum this month in Evanston, Ill., Mr. Kerry talked about how he would be a president whose "idea of diversity in government is not to have oil executives from different companies" setting policy. Mr. Bush's administration, Mr. Kerry said, cares mostly "about the general welfare of large corporations and particularly the drug industry, the oil industry and the other rich people who can make a difference in Washington with all that lobbying and all that money."
Mr. Kerry and Mr. Bush are pressing their cases just as corporate and financial wrongdoing have again become big news. Ms. Stewart's trial and conviction, the indictment last month of Jeffrey K. Skilling, Enron's former chief executive, the indictment this month of Bernard J. Ebbers, the former chief executive of WorldCom, and the revelations that the Royal Dutch/Shell Group misstated its oil reserves have all helped push the topic back into the political arena.
"It's going to be very difficult for Bush to insulate himself from those attacks from Kerry and the Democrats," said James A. Thurber, director of the Center for Congressional and Presidential Studies at American University in Washington. "When you see a close connection between corporate America and the White House, that can be very damaging for an incumbent when the election is about his performance on the economy."
Mr. Bush has been working to make sure he is on the right side of the issue since long before the campaign got under way. Mr. Bush regularly invokes his decision to sign into law in 2002 the most far-reaching legislation to emerge from Congress after the initial raft of corporate scandals, a measure that extensively overhauled corporate fraud, securities and accounting laws and regulations. (He does not mention that he was a late convert to the bill, after initially opposing many of its main provisions.)
White House officials say the wave of prosecutions show the administration is tough on corporate crime and beholden to no one.
To a group of supporters at a Y.M.C.A. in Ardmore, Pa., last week, Mr. Bush laid some of the responsibility for the economy's troubles on "some C.E.O.'s that weren't honest with their shareholders and their employees" and said the corporate fraud legislation was having its intended effect.
"You're now beginning to see on your TV screens what we're talking about," Mr. Bush said.
But to Democrats, the corporate scandals are just a political ice breaker for their broader critique. They cite polls that have found what one Democratic strategist with ties to the Kerry campaign called Mr. Bush's "soft underbelly," a sense among voters that the president is more aligned with powerful corporate interests than with regular people. In a CBS News poll at the end of last month, 55 percent answered yes when asked if many of Mr. Bush's decisions are influenced by special interests (the figure for Mr. Kerry was 38 percent).
Mr. Kerry's advantage on the issue by other measures is not overwhelming, though. When asked in a New York Times/CBS News poll this month how much Mr. Bush cared about "the needs and problems of people like you," 63 percent answered a lot or some, and 36 percent answered not much or not at all. When asked the same question about Mr. Kerry, 70 percent said a lot or some and 21 percent said not much or not at all.
Mr. Bush's advisers profess not to be worried.
"If you look back 5, 10, 20 years, voters have always had a tendency to think Republicans are too close to corporate interests," said Matthew Dowd, Mr. Bush's chief campaign strategist. "But that doesn't mean it affects voters in how they actually vote."
Mr. Bush speaks out forcefully on the topic because "as a former businessman he believes there are ethics and laws people ought to abide by," Mr. Dowd said, and because the scandals "had an effect on the economy and a huge effect on the stock market."
As to the broader populist assault by the Democrats, Mr. Dowd said Mr. Bush proved he could parry that line of attack when it was used by Al Gore in 2000.
"The American public doesn't respond very well to rich versus poor or rich versus middle class," Mr. Dowd said.
"I know it's a message that the Democrats seem to talk about every time Bob Shrum gets a hold of a candidate," he added, referring to the Democratic strategist employed by both Mr. Gore and Mr. Kerry. "But there's no reason to think it will work any better today than four years ago."
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