Bill Press: The Enron smoking gun
By Bill Press
WASHINGTON (Tribune Media Services) -- "Who cares if there were a hundred meetings?" sniffed Mary Matalin, chief spokesperson for Vice President Dick Cheney.
In one phrase, she summed up the White House arrogance: It's a financial scandal, not a political one. It has nothing to do with the Bush administration. It doesn't matter how much money Enron gave George W. Bush, how many former Enron officials work in the White House, or how many secret meetings Cheney held with Enron executives in putting together his energy plan. Because there's no proof that Enron ever got anything for its money or access.
Wrong. Maybe there was no proof before, but there is now; a secret memo -- personally handed to Cheney by Ken Lay, which helps explain why the White House is so skittish about Enron and why Cheney and Bush stubbornly refuse to release the records of those energy task force meetings.
The memo was obtained by the San Francisco Chronicle and reported exclusively there last week. This is the Enron smoking gun.
The Enron memo, which Lay gave Cheney during their one-on-one meeting in April of 2001, makes eight energy-policy recommendations. Some are technical, dealing with such issues as equal access to transmission grids. Others relate specifically to California's energy problem.
Seven out of eight recommendations were adopted in the administration's final energy plan. And Lay's request that Bush and Cheney reject California's plea for federal assistance became White House policy.
Most of us have forgotten last year's energy crisis. Californians can't. For weeks, they experienced rolling blackouts caused by soaring wholesale prices for electricity. As a result of deregulation, approved by the state legislature the year before, California's utilities had sold their generating capacity to Enron and other out-of-state energy companies, which then proceeded to jack up prices.
Gov. Gray Davis, initially slow to react, blamed California's problems on Enron and other energy "cowboys" for engineering "a massive transfer of wealth" from California to Texas. He asked President Bush for relief in the form of federal price caps on electricity, vowing: "Never again can we allow out-of-state profiteers to hold Californians hostage."
Davis was more correct than he realized. Not only was Enron responsible for California's energy crisis, it had the support and cooperation of the Bush White House.
On California, Lay made three arguments: It was too early to tell whether deregulation was working; imposing even temporary price caps would be harmful to energy companies; and Californians were responsible for creating their own problems and deserved no federal assistance. All of which became talking points for Bush and Cheney.
"We think that's a mistake," Cheney said when asked about California's request for federal price controls.
He then proceeded to lay the blame on California: "When the problem became obvious last year, over a year ago, they didn't respond. I don't call that a sterling record of leadership, I would guess, on their part." Ken Lay could not have said it any better.
The purpose here is not to reargue the California energy crisis. It's to point out that when President Bush and other administration officials insist that Enron had little access and what access it did have never paid off, they are simply not telling the truth. The Ken Lay memo is the latest proof of just the opposite.
We know that many former Enron officials were given top jobs in the Bush administration. We know that Ken Lay got to interview candidates for the Federal Energy Regulatory Commission and recommend its new Chairman.
We know that Enron executives held six secret meetings with Dick Cheney. We know that 17 recommendations of Enron were included in Cheney's final report. And now we know that Ken Lay sought to dictate administration policy toward California.
One week before Enron's collapse, last November, Lay called Treasury Secretary Paul O'Neill and Commerce Secretary Don Evans seeking a last-minute federal bailout and was turned down. That's the only time Enron heard the word "no" from their friends in Washington.
Up until the very end, when it was too late to help, everything Enron asked for from the Bush White House, Enron got.
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