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July 4th, 2002:

Harken-gate, coming to a theater near you

Harken-gate, coming to a theater near you Charles Murtaugh writes about the revelations that Dubya may have engaged in some illegal insider trading back in 1989 when he made over $800,000 selling stock at just the right time in the floundering Harken Energy company. Murtaugh notes that the meat of this scandal, if the Democrats want to get traction with it and avoid the mistakes Ken Starr made when he went Clinton-hunting, is not in the technicality of Bush’s late report to the SEC or the details of how he made the money, it’s his close personal connection to the whole thing:

So here’s the beauty part for the Democrats: it doesn’t matter whether or not Bush broke the law in his insider trading. The scandal here is moral, rather than legal: Bush was intimately connected with a corporate accounting scandal precisely akin to those now in the headlines, and costing tens of thousands of jobs. If the Democrats focus solely on the legalistic question of how Bush made his eight hundred large, they’ll be making a Starr-esque error. It really didn’t matter whether or not Clinton lied to the grand jury about his affair, the real Lewinsky scandal was that he’d been having the affair at all. The conservatives were right: character matters.

In Harken-gate, it makes little difference whether Bush broke the law by waiting thirty weeks to alert the SEC of his stock sale, instead of the required two or three (yawn… eyes… glazing… over… must… follow… the money…). What will be harder for Bush to shake off between now and 2004, particularly if the corporate accounting scandals continue to drag down the economy, is his guilt-by-close-association with a book-cooking energy company.

I think Murtaugh is absolutely right about the late filing, which I note that Team Bush is blaming on “clerical error”. The bit about how Bush came out of this with nearly a million bucks is probably just a corollary to the moral scandal that Murtaugh talks about. The Chron article lays out the case pretty nicely, with the crucial bit being right here:

During the 1994 gubernatorial campaign, Bush denied knowing Harken was having financial problems at the time of his stock sale even though he was on the board’s audit committee.

Where have we heard that defense before? From Kenny Boy and the Enron Ensemble all the way back to Poppy “I was out of the loop” Bush, the standard response is always one of ignorance. Never mind my position of authority, I had no idea that things were going to hell in a handbasket all around me.

Well, forgive my impertinence, but maybe you should have known. As Gregg Easterbrook notes, CEOs have been built up as talented, visionary superheroes, with salaries and perks to match. Yet when performance fails utterly to justify the remuneration, the CEOs still get paid handsomely, often with bonuses, while the people who did the real work get shown the door.

Here’s a modest proposal for corporations: Tab any random idiot to be CEO, pay him or her a simple million bucks, and keep doing what you’re doing. The cheaper CEO will have as much effect on your long term profitability as any overpriced Jack Welch wannabee, and their cries of ignorance when your earnings inevitably have to be restated will be much more credible. It’s a clearcut win-win for all involved. I’m available if you ask nicely, and I bet Larry would be happy for the chance to take a major step closer to his billion-dollar goal.

OK, I’m a bit off track here. Anyway, if the Dems keep it simple and say that whenever you put a Bush in charge, things fall apart while he and his friends make out like bandits, they might be able to get somewhere. We’ll see what happens.

Oh, and as an aside to Mickey Kaus: This may not specifically be Enron, but it’s close enough. Still think there’s no campaign issue here?

RIP, Ray Brown

RIP, Ray Brown It’s been a bad week for bassists, as legendary jazz bassist Ray Brown died in his sleep at the age of 75. Brown, who was married to Ella Fitzgerald for four years, was on tour with his trio at the time.

A college buddy I lived with for a summer introduced me to Ray Brown via the excellent CD Soular Energy, which featured a lovely arrangement of Take the A Train and the rip-snorting Mistreated but Undefeated Blues, which is on my short list of Greatest Song Titles Ever. Take a moment and check it out.

Vaya con Dios, Ray Brown.

Unbelievable

In an editorial on the budget deficit (from Wednesday, which I forgot to publish), the Chron actually gives praise to Bill Clinton in a manner that is neither snarky nor left-handed. Is the regular editorial board on vacation? How could they let this happen? Look! In the streets! I see dogs and cats living together! Aaaahhhh!

Bad news, good news

Governor Goodhair picked up an endorsement from a group of black ministers, which may help him peel off some of the black vote from Tony Sanchez.

“I don’t see why you need to change a horse in the middle of the stream,” said alliance member the Rev. F.N. Williams of Antioch Missionary Baptist Church.

That doesn’t sound like high praise to me, but the bottom line is what matters.

The good news comes from some poll numbers:

As Perry received the endorsement, the UH Center for Public Policy released its new Texas Public Policy Survey showing that Perry leads Sanchez by 42 percent to 32 percent.

Pollster Richard Murray, a UH political science professor, said the poll indicates a sizable gain for Sanchez, an oilman and banker from Laredo.

A separate Scripps-Howard Texas Poll released in early June showed that Perry had a 20-point lead.

Murray said Perry appears to be slipping amid attack ads by Sanchez and a recent string of bad news for Texas, including a projected $5 billion state budget shortfall.

“Sanchez isn’t so much gaining support as softening up Perry,” Murray said. “Perry is an incumbent governor, but he succeeded to the office and is not yet well known to many Texas voters.”

[…]

The Texas Public Policy Survey — a telephone poll of 739 registered Texas voters conducted June 20-29 — had a margin of error of plus or minus 3.5 percentage points.

The poll also showed that:

  • Democrat Ron Kirk holds a lead of 36 percent to 28 percent over Republican John Cornyn for the U.S. Senate seat being vacated by Phil Gramm. The earlier Texas poll showed Cornyn leading 35 percent to 30 percent. Cornyn is Texas attorney general, and Kirk is a former mayor of Dallas.
  • The race for lieutenant governor is tight, with Republican David Dewhurst, the state land commissioner, at 31 percent to 29 percent for Democrat John Sharp, a former state comptroller who narrowly lost the 1998 lieutenant governor’s race to Perry. Dewhurst led the Texas Poll 36 percent to 29 percent.

Wow. Kirk is doing better than I’d have thought. I’m actually surprised that John Sharp is not leading his race, but a statistical tie isn’t bad. And Rick Perry doesn’t seem to have much of an incumbent’s advantage. So all in all, not too bad.

Elsewhere in this piece, Sanchez bashes Perry for not returning all of the campaign contributions he got from WorldCom, and Perry bashes Sanchez for having made money off of Enron in the past. A Perry spokesman claims that Sanchez should return the money he got from selling Enron stock in 2000 as well as any profits Sanchez’s oil and gas company made from doing business with Enron.

Um, I think there’s a small bit of difference between owning stock in a company and getting a campaign contribution from a company. Plus, in 2000 when Sanchez sold his Enron stock, Enron was still on top of the world. Is Perry saying that Sanchez had really advanced knowledge of Enron’s collapse, or is he saying that any money earned from Enron is tainted? If it’s the latter, there are lots of people who will need to cleanse themselves. This all strikes me as silly.