Lay called Treasury Secretary Paul O'Neill on October 28, 2001, to advise him that Enron was heading toward bankruptcy. The next day, Lay asked Commerce Secretary Don Evans for help in keeping a major Wall Street ratings agency from downgrading Enron's credit rating, which would push the company into bankruptcy. A week later, Enron president Greg Whalley called Treasury Under Secretary Peter Fisher six to eight times, seeking help in getting banks to lend more money to Enron.
Following these revelations, the White House was forced to admit in January 2002 that it had asked Lawrence B. Lindsey, former head of Bush's National Economic Council, to conduct a review in October 2001 - before Lay called O'Neill and Evans -- to see whether an Enron collapse could have a strong impact on the American economy. Critics were in an uproar following the admission, because President Bush and his senior aides had vehemently denied having any prior knowledge of Enron's financial status or impending troubles.
As Jennifer Palmieri, a spokeswoman for the Democratic National Committee said at the time, "it shows once again that the administration did a lot of thinking about the fact that the company was going to collapse, but they did absolutely nothing to make sure that 50,000 Enron employees would not lose their life savings."
The intimate relationship between Enron and the Bush administration is also clearly shown by these documents. Lindsey had been a paid consultant for Enron, receiving $50,000 in 2000. And he is just one of the top White House and Republican Party officials with close Enron ties, including Robert Zoellick, the United States trade representative who sat on an Enron advisory board in 2000; Karl Rove, senior White House political strategist, who held more than 1,000 Enron shares before selling them in June 2001; and Marc Racicot, chairman of the Republican National Committee, who worked as an Enron lobbyist last year.
Then there are Enron's close financial ties to the Bush campaign. Enron and its employees gave more than $1 million to Bush's 2000 election campaign, the Republican Party, and the Bush Inaugural, and Bush aides used the Enron corporate jet during the post-election fracas in Florida.
But perhaps the most egregious crime is how President Bush and Vice President Cheney sat by and allowed Enron to rip off California.
On May 29, 2001, when the California energy crisis reached its peak, resulting in nearly a week of rolling blackouts, bankruptcies, and several deaths, Gov. Gray Davis met with Bush at the Century Plaza Hotel in West Los Angeles, and pleaded with him to enact much-needed price controls on electricity sold in the state, which had skyrocketed to more than $200 per megawatt-hour.
Davis asked Bush for federal assistance, such as imposing federally mandated price caps, to rein in soaring energy prices. But Bush refused, saying California legislators had designed an electricity market that left too many regulatory restrictions in place and that it was that which had caused electricity prices in the state to skyrocket.
It was up to the governor to fix the problem, Bush said, adding that the crisis had nothing to do with energy companies manipulating the market.
But Bush's response, in hindsight, appeared to be part of a coordinated effort launched by Lay to have Davis shoulder the blame for the crisis, which ultimately led to an unprecedented recall of the governor and Republican-funded attack ads on Davis' handling of the energy crisis.
A couple of weeks before the Davis and Bush meeting, the PBS news program Frontline interviewed Cheney. Cheney was asked by a correspondent from Frontline whether energy companies were acting like a cartel and using manipulative tactics to cause electricity prices to spike in California.
"No," Cheney said. "The problem you had in California was caused by a combination of things - an unwise regulatory scheme, because they didn't really deregulate. Now they're trapped from unwise regulatory schemes, plus not having addressed the supply side of the issue. They've obviously created major problems for themselves and bankrupted PG&E in the process."
In April 2001, a month before the Frontline interview and Bush's meeting with Davis, Cheney, who chaired Bush's energy task force, met with Lay to discuss Bush's National Energy Policy.
Lay recommended some energy policy initiatives that would financially benefit his company, and gave Cheney a memo that included eight recommendations for the energy policy. Of the eight, seven were included in the energy policy's final draft. The energy policy was released in late May 2001, after the meeting between Bush and Davis, and after Cheney's Frontline interview.
What many people have failed to realize is that Davis was right in his assessment that energy companies, including Enron, were manipulating the state's wholesale power market. To this day, neither Cheney nor Bush has acknowledged that they got it wrong and that their inaction helped fuel the California energy crisis.
It appears that neither Lay nor Skilling will be held responsible for the scams Enron's traders pulled on California either. The federal court judge presiding over the criminal case against Lay and Skilling ruled earlier this month that the smoking gun transcripts and audiotapes showing how Enron traders caused shortages and blackouts in California could not be introduced by the prosecution as evidence during the trial because it would prejudice the jury.
Following these revelations, the White House was forced to admit in January 2002 that it had asked Lawrence B. Lindsey, former head of Bush's National Economic Council, to conduct a review in October 2001 - before Lay called O'Neill and Evans -- to see whether an Enron collapse could have a strong impact on the American economy. Critics were in an uproar following the admission, because President Bush and his senior aides had vehemently denied having any prior knowledge of Enron's financial status or impending troubles.
As Jennifer Palmieri, a spokeswoman for the Democratic National Committee said at the time, "it shows once again that the administration did a lot of thinking about the fact that the company was going to collapse, but they did absolutely nothing to make sure that 50,000 Enron employees would not lose their life savings."
The intimate relationship between Enron and the Bush administration is also clearly shown by these documents. Lindsey had been a paid consultant for Enron, receiving $50,000 in 2000. And he is just one of the top White House and Republican Party officials with close Enron ties, including Robert Zoellick, the United States trade representative who sat on an Enron advisory board in 2000; Karl Rove, senior White House political strategist, who held more than 1,000 Enron shares before selling them in June 2001; and Marc Racicot, chairman of the Republican National Committee, who worked as an Enron lobbyist last year.
But perhaps the most egregious crime is how President Bush and Vice President Cheney sat by and allowed Enron to rip off California.
On May 29, 2001, when the California energy crisis reached its peak, resulting in nearly a week of rolling blackouts, bankruptcies, and several deaths, Gov. Gray Davis met with Bush at the Century Plaza Hotel in West Los Angeles, and pleaded with him to enact much-needed price controls on electricity sold in the state, which had skyrocketed to more than $200 per megawatt-hour.
Davis asked Bush for federal assistance, such as imposing federally mandated price caps, to rein in soaring energy prices. But Bush refused, saying California legislators had designed an electricity market that left too many regulatory restrictions in place and that it was that which had caused electricity prices in the state to skyrocket.
It was up to the governor to fix the problem, Bush said, adding that the crisis had nothing to do with energy companies manipulating the market.
But Bush's response, in hindsight, appeared to be part of a coordinated effort launched by Lay to have Davis shoulder the blame for the crisis, which ultimately led to an unprecedented recall of the governor and Republican-funded attack ads on Davis' handling of the energy crisis.
A couple of weeks before the Davis and Bush meeting, the PBS news program Frontline interviewed Cheney. Cheney was asked by a correspondent from Frontline whether energy companies were acting like a cartel and using manipulative tactics to cause electricity prices to spike in California.
"No," Cheney said. "The problem you had in California was caused by a combination of things - an unwise regulatory scheme, because they didn't really deregulate. Now they're trapped from unwise regulatory schemes, plus not having addressed the supply side of the issue. They've obviously created major problems for themselves and bankrupted PG&E in the process."
In April 2001, a month before the Frontline interview and Bush's meeting with Davis, Cheney, who chaired Bush's energy task force, met with Lay to discuss Bush's National Energy Policy.
Lay recommended some energy policy initiatives that would financially benefit his company, and gave Cheney a memo that included eight recommendations for the energy policy. Of the eight, seven were included in the energy policy's final draft. The energy policy was released in late May 2001, after the meeting between Bush and Davis, and after Cheney's Frontline interview.
What many people have failed to realize is that Davis was right in his assessment that energy companies, including Enron, were manipulating the state's wholesale power market. To this day, neither Cheney nor Bush has acknowledged that they got it wrong and that their inaction helped fuel the California energy crisis.
It appears that neither Lay nor Skilling will be held responsible for the scams Enron's traders pulled on California either. The federal court judge presiding over the criminal case against Lay and Skilling ruled earlier this month that the smoking gun transcripts and audiotapes showing how Enron traders caused shortages and blackouts in California could not be introduced by the prosecution as evidence during the trial because it would prejudice the jury.
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