Thursday, May 25, 2006

Enron Trail Leads to Bush and Cheney

On July 13, 1998, employees of one of the two power-marketing centers in California watched incredulously as the wholesale price of $1 a megawatt hour spiked to $9,999, stayed at that price for four hours, then dropped to a penny. Someone was testing the system to find the limits of market exploitation. This incident was the earliest indication that the people and the state could become victims of fraud. The Sacramento Bee broke the story three years later, on May 6, 2001.

Today, Californians are still paying the costs of the debacle while according to state officials the power companies who manipulated the energy markets reaped more than $7.5 billion in unfair profits.

During those early months of the Bush administration, and even during the prior transition period, Dick Cheney was deeply involved in gathering information for a national energy policy. The intelligence he gathered would provide justification for a war against Iraq but would also place White House footprints all over a fraud scam. This is how it all happened.

Ken Lay, the former chairman of Enron, enjoyed a long and close relationship with George Bush senior is a well-known fact. What isn’t so well known is that George W. Bush also benefited from a close relationship with Lay. No one supported the younger Bush quite like Lay. Enron executives contributed more than $2 million to George W. Bush’s political campaigns since 1999, earning Lay an open door to the governor’s office. Lay was also Bush’s number one choice for Treasury Secretary. A study authorized by Rep. Henry Waxman reveals that Enron had 112 known contacts with the Bush administration in 2001. This figure does not include seventy-three disclosed contacts between former Army Secretary Thomas White and his former colleagues at Enron. (Secretary of Defense, Donald Rumsfeld, recently fired White.)

Significantly, Ken Lay was also a close friend to Dick Cheney who is a former Enron shareholder. It should come to no one’s surprise that given the relationships, Ken Lay was selected to work on the Bush energy transition team under the chairmanship of Cheney. Lay’s easiest assignment? He interviewed potential candidates for the Federal Energy Regulatory Commission, an agency that would oversee his company (and months later lead a slow, long investigation into Enron’s role in the California energy debacle). The President picked Lay’s nominee, Pat Wood, to serve as chairman of the agency.

Ken Lay was a very useful and a very knowledgeable man to have around. He knew, for instance, of the holes in the California power market that could be exploited. He tried to warn officials about the problem in 1994 when Enron testified at a Public Utility Commission hearing. Unfortunately his advice was ignored. Enron then went with the flow. It reversed itself, endorsed the system, and lauded the politicians for setting up what Enron knew was an exploitable and faulty infrastructure.
As events would unfold, the dark side of Enron got part of its comeuppance when the Justice Department began investigations of Enron’s role in the California energy disaster.

Along with Dynegy and other power brokering companies, Enron employees were subject to federal criminal charges. One Enron employee pleaded guilty to wire fraud while Dynegy agreed to pay $5 million in fines.

Enter A Little Damning Document

In April of 2001, Ken Lay handed Dick Cheney a two-page memorandum recommending national energy policy changes. The memo contained Enron’s positions on specific, rather technical issues, which were presented as a “fix” for the California crisis. (Enron brazenly advised the administration not to place price caps on energy, which would be precisely the request California officials made to the President, and which the President and the Vice President would just as brazenly deny until public pressure forced them to capitulate.)

According to a special report prepared for Rep. Henry A. Waxman, over seventeen energy policies recommended by Enron made their way into the official White House National Energy Policy report.

Congress awoke from its somnambulism, having become alarmed at Enron’s close association with the Bush administration. Congressional committees asked Dick Cheney for the names of those who advised him and the reports he relied upon in drafting the nation’s energy policy. Cheney bluntly and adamantly refused to reveal those facts. After months of standoff, the General Accounting Office (GAO) filed a suit against the Vice President in an effort to obtain the requested information. The White House then developed a fascinating legal strategy that helped them triumph over the legislative branch.

Defense attorneys from the civil division of the Justice Department should have been assigned to the case. However, in an unprecedented move, the Bush administration required the services of the nation’s number-one-gun, Theodore Olson, the Solicitor General, who normally only makes appearances before the Supreme Court. Olson, his Assistant Solicitor General, and a handpicked group of Justice Department lawyers formed a special “trial defense task force” to defend the Vice President. This act telegraphed to the court, press, and public that this was no ordinary case. The move paid off, a federal judge found for Mr. Cheney and the GAO declined to file an appeal. That, more or less, marked the end of the story. But then something happened.

On October 6, 2002, a newspaper in the UK published a little known article about Mr. Cheney’s advisers. According to Neil Mackay, an award-winning journalist, writing for Scotland’s Sunday Herald, Dick Cheney commissioned an energy report from ex-Secretary of State, James Baker III. The time of this “commission” is not reported, but since the members of the appointed task force held three videoconferences and teleconferences in December, January, and February 2000-2001, Cheney therefore logically contacted Baker some time prior to the December 2000 meeting—during the presidential transition period.
The Baker energy task force produced a report titled, Strategic Energy Policy Challenges for the 21st Century, dated April 2001. There is no mistaking the fact that reasonable, detailed and important expert advice is meted out to the new president. However, this amazing 107-page report strikes a drumbeat for action that grabs the reader as it propels a picture of a naked, energy-scarce nation, subject to energy shortages and price fluctuations, across its pages. Contrasting the state of what is, against what should be, and mercifully making powerful recommendations that will “save our economy,” it offers warnings such as: a sharp rise “in oil prices preceded every American recession since the late 1940s.”

The California energy crisis is raised again and again, along with the prophecy that America can expect “more California-like incidents” in the future. There’s even a connection made between the California crisis and the Middle East, which according to the report, “will remain the world’s base-load supplier and least expensive source of oil for the foreseeable future.” With that prophetic utterance, the stage is now set for a new actor, a new villain, and a new energy policy.

.... continued at link with "Enter Saddam Hussein"

The oil slick that covers the White House stretches from Auschwitz to Abu Gharib, and no I will not be distracted by people whining that I am comparing Auschwitz to Abu Gharib. I am not.
What I am drawing attention to is the fact, that the Bush family has been the one constant from Auschwitz to Abu Gharib - I am not comparing the facilities only the fact that in both instances the same family was involved. It is ludicrous to me that a family shown in the U. S. National Archives to have traded with the enemy and profited extensively from the profits of Auschwitz, now sits with a son in office who is instituting torture facilities and facism worldwide. One would think - DUH - that genetics, family training and a money trail a mile long just might prompt the press to report as if they lived in a democracy instead of a criminal corporate gulag.