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Page   1 - Duke Energy Employee Advocate

Washington - Page 11

“This administration wants to give big business a free pass." - Steven Rosenfeld (

Over His Dead Body

L. A. Times – by Robert Scheer – January 9, 2002

Talk about the politics of class struggle. George W. Bush now is apparently willing to give his life to make the rich richer. "Over my dead body" was his response to proposals to scale back the $1.35 trillion in tax cuts planned for the next 10 years.

Notice that he didn't say "over my dead body" will the homeless--many of them actually employed in low-paying jobs--sleep in the snows of Minneapolis because the "faith-based" as well as government shelters are short on funds. Nor is it "over my dead body" that Enron workers will be left holding the bag emptied by the president's good friend, Kenneth L. "Kenny Boy" Lay. Nor is it "over my dead body" that the Boeing company will be given a $22-billion Air Force contract as it fires thousands of its workers. The president cannot say that "over my dead body" will he forget his pledge to assist seniors with prescription medical costs, save Social Security and revive public education, when in fact his tax cut has made it impossible to deliver on any such promises.

Nope, his is the manifesto of a true son of the super rich who has never known a nanosecond of economic insecurity and genuinely believes that the truly burdened are those with enormous wealth. The truly needy in the Bush lexicon are the very wealthy folks who must be given tax breaks so they may more easily invest in the economy. The rest of us are told it is our patriotic duty to buy things we cannot afford, but the rich can only be expected to invest if it does not cost them anything in after-tax dollars.

With blase arrogance, the president now insists that his skewed tax cut be amplified in the years to come. This is a cheerleader who doesn't know the game is lost: Unemployment is at a decade high, the huge Clinton budget surplus is now going into deficit, and eight years of buoyant prosperity and growth have been turned into a sour recession.

The fact that none of this gives President Bush pause is the purest indication that he does not, in the least, grasp the suffering engendered by his policies.

It does not have to be this way. The rich can indeed "get it," as Franklin Delano Roosevelt and many other wealthy American leaders have demonstrated. However, it does take a bit of work to wedge one's feet into the pinched shoes of the less fortunate--work that the president (like his father before him) has not been inspired to perform.

Perhaps if the media and the Democrats had challenged Bush's nostrums more forthrightly he could have moved beyond the ingrained smugness of a rich brat.

That did not happen, however, and instead the failure of this administration's economic policies has been ignored, particularly in the aftermath of Sept. 11. Indeed, that tragedy is turned to the most shameful of partisan political purpose to explain away a recession that began in earnest in March, half a year before the terrorist attack.

It is Bush and not Osama bin Laden who is responsible for subverting the fiscally conservative policies of the Clinton years. A true conservative would say that "over my dead body" would the government siphon the surplus created by Social Security taxes to the pockets of the rich, putting the nation further into the red.

Bush may be the hero of the moment but it won't be so when future generations try to collect their Social Security checks. If Bush keeps it up he will be remembered as another Herbert Hoover, a president who let the unemployment lines grow while the government went broke catering to the wealthy.

Enron Altered Power Industry

Washington Post - by D. Morgan, J. Eilperin - January 6, 2002

Washington -- During the administration of the first President George Bush, a new party fund-raiser named Kenneth Lay was invited to spend the night at the White House. The sleepover was an early coup for the chairman of Enron Corp. and a harbinger of things to come.

During the following decade, Lay and Enron poured millions of dollars into U.S. politics, cultivating unequaled access and using the entree to lobby Congress, the White House and regulatory agencies for action that was critical to the energy company's spectacular growth.

Now, with Enron's sudden bankruptcy, public attention has turned not only to the financial practices that brought the company down, but to what its far- flung political operations say about the country's campaign finance system.

Some Democrats in Congress are spoiling for an opportunity to use Lay and Enron to embarrass the Republican Party, which received most of the company's largesse over the years. They want to look into such things as Enron's relationship with Phil Gramm, R-Tex., ranking minority member on the Senate Banking Committee and chairman of the committee at a time when his wife, Wendy Gramm, was serving on Enron's board. Last year, Gramm's committee approved legislation that included a key provision exempting parts of Enron's extensive energy trading operation from federal oversight.

"I think the Enron story is going to turn out to be an enormous political story," said Rep. Henry Waxman, D-Los Angeles, ranking minority member on the House Energy and Commerce Committee.

The ties of Lay to the White House and GOP leaders, he added, were so multilayered that Republicans are likely to be reluctant to pursue them. But he made clear that he intends to do so and expects the Democratic-controlled Senate to follow suit.

Enron also cultivated relationships with Democrats, however. Lay played golf in Vail, Colo., with President Bill Clinton, and Enron gave hundreds of thousands of dollars to Democratic campaign committees and Democrats in the House and Senate, including Sen. Charles Schumer of New York and Texas Rep. Martin Frost Texas, the ranking minority member on the House Rules Committee.

Advocates of campaign finance reform say the Enron case vividly illustrates the ties between politics and big money, though it's unclear that the company's political operations were radically different from others for whom political contributions have become a routine cost of doing business.

"There are aspects of (the Enron case) that remind us of the savings and loan scandal, in the sense that a powerful institution used big money to buy influence and protect itself while ordinary citizens ended up losing their life savings," said Fred Wertheimer, president of Democracy 21, a Washington interest group.


Enron's ties to Republicans and the present Bush administration were especially close. Lay raised large sums for George W. Bush's campaign.

Enron, Lay and its employees have contributed $572,350 to him over Bush's career, far more than any other company, according to the Center for Public Integrity in Washington.

Several top administration officials have been Enron advisers or stockholders. Enron, Lay and other senior executives contributed $1.7 million in soft-money donations to politicians in the 2000 election cycle, two-thirds of it to Republicans, according to the Center for Responsive Politics.

Republicans clearly are sensitive to the potential political dangers. The National Republican Senatorial Committee recently returned a $100,000 check collected from Enron in November after deciding that "it was appropriate to give it back," spokesman Dan Allen said. The Republican Governors Association last week returned an Enron donation of $60,000.

What was unique about Enron, competitors and allies agree, was a brash and sometimes counterproductive political style.

Stories of Enron's hardball style are legion. In October 1999, for example, Jeffrey Skilling, then Enron's president, expressed his displeasure at Rep. Joe Barton's position on a deregulation bill pending in the energy subcommittee the Texas Republican chairs.

The meeting grew "heated and awful," said one person who was present, until Barton, a usually mild-mannered man who keeps a Bible on his desk, exploded. "Jeffrey Skilling, I may not have your millions of dollars, but I am not an idiot," one witness recalled Barton saying. The meeting ended without Enron getting the changes it wanted.


"Skilling did not get Washington," the source added.

"In their lobbying, they acted like the 800-pound gorilla they were," said Christopher Horner, a Washington lawyer who briefly directed Enron's government relations in 1997.

Lay and Skilling declined interview requests, but Enron officials say they have no regrets about their use of money. "It got us name recognition," company spokesman Mark Palmer said. "Given the aggregation of our foes, we had to make sure that people knew what our argument was."

Almost from its start in 1985 as a gas pipeline company, Enron needed help in Washington, and it got it in a series of actions by Congress and the Federal Energy Regulatory Commission (FERC) that undermined the traditional monopoly of utility companies over power plants and transmission lines.

Enron lobbied for several of the initial actions that set the stage for the era of a deregulated wholesale electricity market.

It supported the 1992 Energy Policy Act, which opened the utility companies' wires to electricity merchants such as Enron. It also worked with the Commodity Futures Trading Commission -- then chaired by Wendy Gramm -- for a regulatory exemption for futures trading in energy derivatives, which later became Enron's most lucrative business. Soon after Gramm stepped down in 1993, she was appointed to Enron's board.


Independent sources knowledgeable about these dealings, however, said Enron was not the main interested party. They said the lead was taken by several major oil companies, including British Petroleum Co. and Phillips Petroleum Co. , which were concerned about the effect of CFTC regulation on their offshore trading in crude oil contracts. Wendy Gramm, an apostle of free markets, needed little convincing, the sources said.

That same year, Lay served as chairman of the committee organizing the Republican National Convention in Houston. Hedging its bets, Enron made a major contribution to a "street fair" in honor of Sen. John Breaux, D-La., a key energy policymaker, at the Democratic convention.

Key orders by FERC in 1996 also supported Enron's transformation into a freewheeling trader of gas, electricity and more exotic products, such as telecommunications services and sulfur-dioxide emissions credits.

The new rules ensured that Enron and other merchant companies could buy electricity from independent power plants and sell it to distant customers, using transmission lines borrowed from utility companies. Even Enron's harshest critics credit Lay with putting new issues -- such as electricity deregulation -- on the Washington agenda. Lay, a former Interior Department official with a doctorate in economics, became "the ambassador" for deregulation, one former employee said.

Throughout the 1990s, Enron's agenda was opposed by coal-burning utilities, especially ones in the Southeast, which viewed the emerging wholesale electricity market as a threat to their turf. Many of these, such as Southern Co. in Atlanta, had impressive political funding and connections of their own.

But with the explosive growth of Enron and the GOP takeover of Congress in 1995, the company's soft-money donations -- unregulated and unlimited gifts to political parties and organizations -- jumped sharply. They went from about $136,000 in the 1993-94 election cycle, to $687,000 in 1996 and $1.7 million in 2000, according to the Center for Responsive Politics.


For all its connections, sources say, Enron often found Washington frustratingly slow and unreliable. The company placed a substantial bet on federal support for limits on the greenhouse gases causing global warming. Enron officials hoped to exploit a new market in industry for carbon-emissions credits, similar to the one that developed for sulfur credits after clean-air legislation was enacted in 1990.

Lay joined the Union of Concerned Scientists and environmental groups in calling for curbs on carbon in the atmosphere. The Clinton administration was supportive, but this year, the Bush administration reneged on a campaign pledge to impose limits on greenhouse gas emissions from coal-burning power plants. A multimillion-dollar lobbying campaign in Congress to secure legislation requiring states to institute retail electricity deregulation fared even worse.

Enron hired former New York Rep. Bill Paxon, a leading conservative, to run Americans for Affordable Electricity, which commissioned studies and recruited business support for deregulation. But the legislation never made it out of a congressional subcommittee.

At the same time, Enron was growing restive over the slow pace of deregulation in the wholesale electricity market, the core of its business. Large parts of the country, especially the Southeast, were still monopolized by regulated utilities that limited the opportunity for trading gas, electricity and energy derivatives.


Enron's political pragmatism was demonstrated in the 1998 New York Senate election, when it dropped its support of the Republican incumbent, Alfonse D'Amato, after Democrat Schumer endorsed Enron's goal of wholesale deregulation, sources said. Lay reciprocated by hosting several fund-raisers for Schumer, and Enron's political action committee contributed $7,500 to the Schumer campaign.

The company's lobbying team expanded along with its political spending. It outgrew the two-person operation that existed in 1989 and began to reflect Enron's interest in everything from pipeline safety and derivatives trading to Overseas Private Investment Corp. loan guarantees.

By last year, its lobbying expenses exceeded $2 million a year and covered a raft of big-name consultants, such as former Montana Gov. Marc Racicot, the new Republican National Committee chairman, and former top aides to House Majority Leader Dick Armey, R-Texas, and House Majority Whip Tom DeLay, R- Texas.

The hazards of Enron's efforts to connect with both parties were evident last year, when shortly before the November election, the company picked a Clinton administration Treasury official, Linda Robertson, to run its Washington office.

A perturbed DeLay, whose campaign and related funds had received more than $100,000 from Enron and Lay, briefly "excommunicated" Enron, a House source said. Robertson was not invited to a series of meetings of electricity lobbyists held in DeLay's office last July, though an Enron official did finally attend the sessions.


Enron had more success when Congress overwhelmingly approved legislation last year containing a provision precluding the CFTC from regulating Enron's trading in energy derivatives. These instruments are traded largely between electricity dealers and big wholesale consumers, which use them to hedge against price swings that could adversely affect their businesses.

The exemption, tucked into broader legislation that established the legality of unregulated derivatives trading by banks, was not supported by a Clinton administration working group, largely because of opposition from the CFTC. Since the departure of Wendy Gramm, some in the agency had lobbied for tighter control over the exploding energy derivatives market. The legislation passed through the Senate Banking Committee, then chaired by Phil Gramm, who has received $97,350 from Enron employees and its political action committee since 1989. A Gramm spokesman said the senator does not recall talking to his wife, an Enron director, about the energy provision and played "no role" in negotiating it. Wendy Gramm did not return phone calls seeking comment.

Enron was a primary player, with Koch Industries Inc., a large, privately held oil and gas company based in Wichita, in pushing for the exemption, a source said. But the company's main effort was focused on the House Agriculture Committee, where the legislation originated. Its Republican chairman and ranking Democrat, Texas Reps. Larry Combest and Charlie Stenholm, respectively, were among the top recipients of Enron campaign donations in the House since 1989.

The CFTC objected strenuously to the initial draft marked up by the committee, but the Texas congressmen helped work out a compromise between Enron and the agency. The compromise was then offered by Rep. Jerry Moran, R- Kan., the home-state congressman of Koch Industries and a recipient of campaign donations from Enron and Koch in the last election cycle. Moran did not return a phone call seeking a comment.


Early this year, Lay seemed to be at the height of his political power, getting a private meeting with Vice President Dick Cheney to discuss the administration's energy policy proposals and weighing in on key nominations to


Curtis Hebert Jr., FERC's chairman at the time, has reported that Lay called him and implied that Enron would urge the newly installed Bush administration to keep him in the job-if he changed his views to support Enron's position for faster electricity deregulation. Lay contended that Hebert called him to ask for support.

Hebert was not reappointed. He was replaced by Texas lawyer Pat Wood III, a strong advocate of deregulation who had the backing of Lay and Enron.

Ironically, since Enron's fall, both FERC and Congress seem to be moving in the direction of the deregulated markets Lay and Enron lobbyists had pushed for.

Bush, Unions Tangle Over Labor Rules

Associated Press – by Leigh Strope – January 5, 2002

WASHINGTON - President Bush has been focusing more attention on labor issues of late, much to the chagrin of major union officials.

Bush has repealed a Clinton-era rule favored by unions that prevents the government from awarding contracts to businesses that have broken environmental, labor, tax or other federal laws. He also has threatened a recess appointment of conservative labor lawyer Eugene Scalia, son of Supreme Court justice Antonin Scalia to inspector general at the Labor Department.

The Bush administration also has announced plans to eliminate the 10 regional offices of the Women's Bureau of the Labor Department and failed to deal with workplace safety after Congress repealed ergonomics regulations last spring.

Since the administration turned to labor issues, said the AFL-CIO's Karen Nussbaum, ``There's been plenty of action. It's been all negative.''

President Clinton signed the lawbreaking contractor rule in 2000, a few months after a computer analysis by The Associated Press found hundreds of contractors remained eligible for new federal business despite convictions or lawsuits for defrauding the government.

The Bush administration had suspended enforcement of the rule in March and repealed it for good last week.

Business groups praised repeal, contending the regulation went too far and unfairly blacklisted companies that had minor infractions or had not been proved guilty.

``This rule gave government agents blanket discretion to blacklist federal contractors based on subjective and arbitrary notions of satisfactory compliance with any federal, state or even foreign law,'' said Randy Johnson, U.S. Chamber of Commerce vice president for labor and employee benefits. ``Mere allegations of wrongdoing could prevent a business from winning a federal contract.''

The chamber organized the National Alliance Against Blacklisting and lobbied Congress with other business groups.

Union officials retorted that a violator of labor, employment, environmental, civil rights or other federal laws cannot be trusted to receive government contracts.

``To ordinary citizens who play by the rules every day, the Bush administration has said that it's OK for corporations that violate the law to be rewarded with millions of taxpayer dollars,'' the AFL-CIO said. Unions also are bracing for a Bush recess appointment of Scalia, which means he could serve without Senate confirmation until next January. The Senate went on its holiday break without taking up the nomination.

Scalia refused to discuss his nomination Wednesday. Organized labor opposes the appointment because of Scalia's opposition to a Clinton-era ergonomics regulation, killed by Congress last spring, which was aimed at reducing workplace injuries. Scalia criticized the rule as ``quackery'' based on ``junk science.''

Ergonomics deals with human characteristics to be considered in the design and arrangement of things to prevent injury to people who use them.

Unions also are awaiting a decision by Labor Secretary Elaine Chao about how the agency will handle workplace safety, with new regulations or voluntary guidelines.

Congress repealed Clinton-era regulations last year after a big legislative fight that pitted business against labor unions. The regulations mandated that employers make changes to reduce the incidence of worker injuries related to ergonomics. After the repeal, Chao promised a ``comprehensive plan'' by her agency to reduce such injuries.

Occupational Safety and Health Administration spokeswoman Bonnie Friedman said Thursday the announcement could come ``very soon.''

``Instead of taking an opportunity to build on progress made during the Clinton administration, the Department of Labor under President Bush and Secretary Chao seems intent on unraveling those gains,'' AFL-CIO President John Sweeney said.

The Bush administration also is considering elimination of 10 regional offices of the Labor Department's Women's Bureau, but Labor spokeswoman Sue Hensley said no decision has been made. The White House Women's Initiatives Office already has been shut down.

My Way, the High Way

L. A. Times – by Senator James M. Jeffords – January 5, 2002

WASHINGTON -- In the months since my decision to leave the Republican Party and become an independent, I have been both hailed and admonished. This is not surprising, given the impact of my decision. Yet, I find that many of the journalists, legislators and ordinary citizens who offer their thoughts still don't understand the reasons behind my decision.

During my 26 years in Congress, I have been labeled many things--a moderate, a liberal, a maverick, an independent--but always, at least until last May 24, with the party affiliation Republican.

As we began 2001, I was hopeful. With a 50-50 U.S. Senate, I expected that moderates would be a strong force and that bipartisanship would prevail. At first, this seemed true. Moderate senators from both parties worked together to make significant changes to the president's budget when it was considered in early April. We were able to reduce the size of the tax cut from $1.6 trillion to $1.25 trillion and to add $450 billion for education. But when we sent that bill to the House-Senate conference committee, all our work, including the $450 billion for education, was stripped out of the final compromise. There were no moderates on the conference committee; it was totally controlled by the Republican leadership and the White House.

More than simply disappointing, the events were a clear signal to me that the Republican leadership had no intention of working with the moderate wing of the party. Something radical needed to happen.

Because the Republican Party controlled the White House, the House of Representatives and, in effect, the Senate, its partisans were able to run t he conference committees, which gave them final say about legislation sent to the president.

It became clear to me that the role of moderates would be limited in the Senate--and that any influence we managed to garner would be overridden by conference committees stacked with partisans. Consequently, many of the issues I care most about--education funding, child care, rights for the disabled, environmental protection, choice, campaign-finance reform--were being pushed aside. I was alarmed that these priorities would continue to fall by the wayside and partisanship would rule the day.

With the Senate evenly split between Democrats and Republicans for the first time since the 1880s, a single senator could shift control of the Senate and change the agenda of the entire legislative body. One person could make a dramatic difference.

In the face of this, my conscience pushed forward a question: What would be the consequence if I did not take action? What would happen with the direction of the judiciary? Tax and spending issues? Missile defense? Energy and the environment? The consequences of doing nothing weighed heavily. I had the power to dramatically change the course of history: If I did not do so, I would have to accept responsibility for the results.

Not everyone saw it that way. Most members of my staff, all but one member of my family and all my Vermont advisors told me not to leave the Republican Party. My son threatened that if I did leave, he would name his first child Reagan Nixon Jeffords.

Still, I knew what I had to do. On May 24, I traveled from Washington to Vermont to make my declaration of independence. That decision changed the nation's balance of power, changed our national agenda and changed my life forever.

Some Senate colleagues may never forgive me; some will always exalt me. In the end, my true friends in the Senate remain my friends.

My switch became official June 6, ending six years of Republican control of the Senate. The media swirled for days with stories about who lost Jim Jeffords. Did I switch because I had been snubbed by political operatives and not invited to the annual White House reception for the National Teacher of the Year, Michele Forman from Middlebury, Vt.? Did I switch because I had been threatened with retribution against my Vermont dairy farmers after I forced the White House to compromise and reduce the size of the tax cut? No. None of this mattered.

What did matter was that the issues I most cared about would be back on the agenda, would be given due consideration, would be advanced.

The media furor following my action was intense. I'll never forget getting off a plane in Italy right after my switch to see my photograph and name in headlines of newspapers from across Europe. I even had a beer named after me. Magic Hat, a brewery based in South Burlington, Vt., created a beer called Jeezum Jim. They dubbed it "a celebration of conviction, courage and the difference one man can make."

Not all the attention was positive. Numerous threats led to my needing round-the-clock police protection for weeks following the decision. The conservative Wall Street Journal editorial page said of me: "Not everyone gets to wake up one morning and decide an inner voice had told him to overturn the results of a national election, an unprecedented legal struggle and a decisive Supreme Court decision to form a government."

Given all that has happened, would I do it over again? Absolutely. I have never felt more confident or secure about any decision in my life.

Because of my switch, Democrats now have a seat at the table and will be part of the final decision-making process. There is balance in the debate.

I do not believe that Democrats should get their way on every issue any more than Republicans should. My decision to become an independent has required all branches of government to compromise and to seek moderation and consensus.

As we begin 2002, we have many challenges ahead. Our nation grapples with the aftermath of Sept. 11 and our war against terrorism. We face economic uncertainty, and we are challenged to improve our schools and health-care system. I firmly believe that my decision to become an independent has brought balance to our deliberations on these vitally important issues.

James M. Jeffords is chairman of the Senate Environment and Public Works Committee. He is the author of "My Declaration of Independence."

Washington - Page 10