After the missed deadlines were noted in published reports in 1991, the SEC opened an insider-trading investigation. At the time, Bush’s father was President and the person responsible for appointing the SEC chairman.
George W. Bush denied any wrongdoing in the Harken stock sales. He insisted that he had sold into the “good news” of Harken landing offshore drilling rights in Bahrain. Bush’s lawyers also argued that he had cleared the stock sale with the Haynes and Boone lawyers, a claim that proved to be important in the SEC’s decision to close the investigation on August 21, 1991, without ever interviewing Bush.
But what the SEC didn’t know at the time was that the Haynes and Boone lawyers had sent Bush and other Harken officials that letter warning against selling shares if they knew about the company’s financial troubles. One day after the investigation was closed, Bush’s lawyer Robert W. Jordan delivered a copy of the warning letter to the SEC.
Asked years later about the letter, SEC investigators said they had no memory of reading it.
“The SEC investigation apparently never examined a key issue raised in the memo: whether Bush’s insider knowledge of a plan to rescue the company from financial collapse by spinning off two troubled units was a factor in his decision to sell,” the Boston Globe reported in October 2002, almost two years after Bush gained the presidency.
Bush also was less than forthcoming about why he missed the deadlines for reporting the June 1990 stock sale and three others. For years, he claimed publicly that he had sent the reports in on time and the SEC had lost them, a sort of the bureaucrats-ate-my-stock-sale-reports argument.
The issue resurfaced in 2002 after Enron and other major companies collapsed in accounting scandals. Bush was positioning himself as a friend of embattled shareholders and demanding that corporate officers reveal their stock sales almost immediately.
Asked why he had not lived up to his own admonition, Bush shifted the blame to Harken’s lawyers for the late filings. He then changed his story again to say that he simply didn’t know what had happened. He never apologized for claiming falsely for years that it had been the SEC’s fault.
Nevertheless, on June 22, 1990, Bush made $848,560 on his Harken stock sale. He used $606,000 of his profits to buy a 1.8 percent stake in the Texas Rangers baseball team. Then, after helping engineer public financing for a new baseball stadium in Arlington, Texas, he sold his interest in the Rangers for $14.9 million, more than 20 times his original investment.
The success of his Texas Rangers investment was even more dramatic when compared with what happened to the Harken stock that Bush sold for $4 a share to that unidentified buyer. A dozen years later, each of those shares would have been worth two cents.
George W.’s time with Harken and his part ownership of the Rangers made him a millionaire and a well-known personality in Texas. That measure of success had derived almost entirely from the family’s triangle of oil-political-financial connections, from Texas to Washington to Wall Street.
Though most of Bush’s sordid business history was known during Campaign 2000, it attracted little attention in the mainstream press, especially compared to the news media’s obsession with dissecting every comment by Al Gore for signs of exaggeration.
Even today, as George W. Bush’s crony capitalism, aversion to regulation, and his trillion-dollar war in Iraq have driven the U.S. – and the world’s – economy off the road and into financial quicksand, big-time journalists continue with their Bush deference. They won’t put too much blame on the person who arguably should top the list of those responsible.
While the Brokaws and Friedmans might justify their behavior as a resistance to “piling on” a lame-duck President, they also are contributing to a distorted history – one that fails to identify Bush and his political/media enablers as largely to blame for this global catastrophe.
By averting their eyes from Bush and focusing so much on Obama now, the mainstream U.S. news media also clears space for right-wing media voices like Rush Limbaugh to begin writing another false narrative, blaming the financial collapse on the incoming President not on the one who has held the office the past eight years.
That narrative, in turn, could restrict what an Obama administration can do once in office. That, in turn, could open the way for a possible Republican comeback in 2010, much as the GOP rebounded from Bill Clinton’s victory in 1992 to win both houses of Congress in 1994.
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