Enron Gave Big Bucks to Democrats, Backed 'Global Warming' Scam

Scandal-plagued Enron Corp., cited by Democrats as a big giver to President Bush and the GOP, gave a cool $420,000 to Democrats when the corporation was desperate to get the Clinton administration's help in having the potentially disastrous Kyoto treaty made the law of the land. Senate ratification of the treaty, which foes explained would have cost the U.S. billions and had a deadly effect on the U.S. economy, would have been a bonanza for Enron.

According to Washington Times reporter Jerry Seper, a December 1997 private internal memo written by Enron executive John Palmisano said the treaty would be "good for Enron stock!!"

"The memo said the Kyoto treaty - later signed by Mr. Clinton and leaders of 166 other countries, but never ratified by the Senate - 'would do more to promote Enron's business than will almost any other regulatory initiative outside of restructuring the energy and natural gas industries in Europe and the United States.'"

Writing in Wednesday's Times, Seper reports, "Federal and confidential corporate records show that after donating thousands of dollars in soft money and PAC donations beginning in 1995, Enron received easy access to President Clinton and Vice President Al Gore."

Seper revealed that Clinton's Energy Department and Environmental Protection Agency "often made themselves available for Enron executives to discuss the firm's needs, according to records, even arranging for meetings with key congressional staffers."

Enron's drive to get the Kyoto Protocol ratified continued even after the Senate voted 95-0 to set restrictions on any climate negotiations. The Senate resolution warned U.S. diplomats against negotiating any climate treaty in which less developed nations such as communist China would have fewer restrictions imposed on them than the U.S. and other developed countries.

That vote gave clear warning that the Senate would never ratify the treaty, costing Enron potential profits in the billions. As a result, Enron used its open door to the Clinton White House to lobby hard for a treaty that would give it the ability to buy and sell trading credits to emit carbon dioxide as part of a strategy to reduce "greenhouse gases."

Under the system pushed by Enron, new investments in gas-fired plants and pipelines would be expanded and coal-fired power plants, which emit more carbon dioxide, would be curtailed. Seper noted, "Natural gas, electricity and their delivery systems constitute Enron's major businesses."

During a White House meeting in July 1997, Enron Chairman Kenneth L. Lay prodded Clinton and Gore to support a "market-based" approach to what he described as the problem of "global warming," a theory discredited by a majority of the world's climatologists.

In the face of Senate hostility to the Kyoto accords, Enron continued to urge the Clinton administration to seek a "restructuring" of the treaty that would have been a "first step to solving the problems of global climate change." Seper notes that the company "sought laws that would have favored Enron's natural gas inventory and reduced competition from coal."

On Feb. 20, 1998, during a meeting with Energy Secretary Federico Pena, Lay "encouraged the Clinton administration to seek electricity legislation favored by Enron," outlining for the secretary what the company believed were the "important" pending legislative concerns.

"Today's meeting between Ken Lay and Energy Secretary Federico Pena to discuss electricity legislation went very well," said a memo written by Jeff Keller, the company's Washington governmental affairs chief.

"Secretary Pena indicated that the White House proposed bill is 'on the president's desk,' and that Clinton could be convinced to release the White House proposal in the next few days," Keller wrote. "He suggested that President Clinton might be motivated by some key contacts from important constituents."

The records showed that Lay took that advice and sent a letter to Clinton that day, asking him to "move this matter forward."

Seper writes that Clinton administration officials have denied any wrongdoing, saying they were only responding to constituent requests.

But while such Democrats as Rep. Henry Waxman of California attempt to create suspicion that Enron's contributions to President Bush and other Republicans gave the company undue influence with the administration without a scintilla of evidence to back up their imaginings, more real proof of the cozy ties between Enron and the Clinton administration continues to unfold.

Seper recalls, for example that, the Washington-based Export-Import Bank approved a $302 million loan toward a $3 billion Enron-controlled power plant in India in 1994.

Wrote Seper: "Mr. Clinton took an interest in the deal, asking the U.S. ambassador to that country and his former chief of staff, Thomas F. 'Mack' McLarty, then a presidential adviser, to monitor the proposal.

"Mr. McLarty - who later became a paid Enron director - spoke with Mr. Lay on several occasions about the plant. In 1996, four days before India granted approval for Enron's project, the Houston-based firm contributed $100,000 to the Democratic

With Carl Limbacher and NewsMax.com Staff

For the story behind the story...

Friday, Jan. 11, 2002

All About Clinton, Enron and China

Don't expect certain Democrats to be too eager to investigate Enron. They won't like what will come out about Bill Clinton and his favorite illegal campaign donor, China.

Here's a fascinating item from the Pittsburgh Tribune-Review's "Dateline D.C." from Dec. 9, headlined "Clinton-Gore sales team eased Enron's path to success." We might have overlooked it if not for an alert from Progressive Review's Sam Smith, that rare honorable leftist who has never flinched from examining Clinton's reign of corruption.

"The so-called 'popular press,' in its usual searches for the clay feet with which they invest every well-known person, will now try to link Enron's present woes to the White House. Too bad, guys, you should have started investigating Enron's ties (ties not links) in 1993 and onward to the sales team of Bill Clinton, Al Gore and Ron Brown," says the Tribune-Review.

And this: "... look at their 1994 sales team - Clinton, Gore and the late Ron Brown - a trio unlimited and uncontrolled in their cunning and greed.

"In what seems to be eons ago, before Gov. Bill Clinton became president, the late, much loved and little lamented Ron Brown was Clinton's good friend and a power broker in the National Democratic Party. Ron Brown had a friend, a congressman from Houston, the late Mickey Leland, who died in 1989. Until his passing, Leland was a shining light in the Congressional Black Caucus and a dedicated socialist, who was one of the Institute for Policy Studies' delights.

"From 1984, when Enron was conceived, Brown and Leland were there snapping up unconsidered trifles of money for use in their campaigns against the free market. Mickey was able to ease a lot of Enron's early problems through the Houston City Council by playing his 'equal opportunity card.' He had also become an African expert who initially took the Enron message to that continent, a chore that was taken on by Ron Brown, Clinton's secretary of commerce, before the latter met his untimely death in a highly controversial plane crash in Croatia. (Untimely, because had Secretary Brown lived, he would have faced multiple criminal indictments that could have precipitated an even earlier fall for Bill Clinton and his gang.)

"Now we get to that old puzzle about chickens and eggs, and what came first! Ron Brown, Al Gore and Bill Clinton introduced Enron to market managers in Russia, China, Indonesia and India. In India, Enron quickly became involved in one of that country's most massive corruption investigations, contracts were canceled and Enron was out.

Enron, Clinton, Lippo, China, John Huang ...

"On the other hand, Enron introduced the Clinton team to Lippo Industries and thence to China's People's Liberation Army (a wonderful source of political cash), to John Huang, another good provider and to nameless, numberless Arabs who never arrived with empty pockets. If we look at a list of those attending coffee klatches at the White House, we can learn why a storm of doubtful deals enabled Enron to quickly control one-quarter of the world's electricity and natural gas. But, that wasn't enough. The ever-so-greedy Dumpty moved in to water deals in Massachusetts and Europe, paper mills in Canada, gas pipe lines throughout the world, fiber optics, television, mutual funds and information gathering. In turn, that led to risk analysis, a name that those clever Texans quickly changed to 'reward realization!'

"The rewards were good! Enron, with sales assistance from Tony Lake, then Clinton's national security adviser, persuaded the impoverished, war-torn country of Mozambique to sign a $770 million electric power contract. Mozambique signed because Tony's salesmanship was persuasive. If the Mozambicans didn't sign, he indicated that their congressionally-approved $44 million U.S. aid payment would never be made.

"And there was the Croatian caper. In the days when Franjo Tudjman was Croatia's dictator and pretending to be both a reformed communist and best friend of America in the Balkans, poor Franjo had a problem. He and some of his very best friends were wanted as war criminals by the Hague's International Court of Justice. Enron wanted a power contract with Croatia. Enron offered a deal to Tudjman. Sign up with us and we will use our gang in Washington to make sure you and your friends don't go to jail.

"Tudjman signed. Enron made a heap of money. Nobody went to jail. Everyone was happy - until Tudjman died of cancer. Then the lid was off, his Croatian Democratic Union was defeated and the new boys in power in Zagreb could not believe how much of their budget went to pay the electricity bills from Enron."

And so forth. Will Democrats open a can of worms in which Slick Willie is, as usual, one of the fattest worms?

STATEMENT OF COMMON CAUSE PRESIDENT SCOTT HARSHBARGER ON DISCLOSURE OF CLINTON LIBRARY DONORS

Tuesday, March 6, 2001

Recently I wrote to the president of the Clinton Library Foundation asking that they publicly disclose their donors of $5,000 or more, and making the case that the arguments for disclosure far outweigh the arguments for secrecy in this case.

Although the Library and the House Government Reform Committee have reached some sort of accomodation with respect to the donor list in question, this backroom deal isn't the answer. The American people still do not have the information that they deserve in order to draw their own conclusions. Without this information, serious questions linger about whether presidential pardons were directly connected to gifts or pledges to the Library.

Frankly, I am astonished that former President Clinton hasn't learned from his past mistakes and is still trying to keep this information from public view. I hope he reverses this position, regardless of the backroom deal struck with the Burton committee.

Full text of letter available at: HERE

Enron often avoided income tax Firm eligible for refunds of $382 million in past 5 years

David Cay Johnston, New York Times Thursday, January 17, 2002

--------------------------------------------------------------------------------

Enron paid no income taxes in four of the past five years, using almost 900 subsidiaries in tax-haven countries and other techniques, an analysis of its financial reports to shareholders shows. It was also eligible for $382 million in tax refunds from the Treasury.

The company used strategies common among businesses to avoid taxes. It also used some unusual methods -- including the creation of 881 subsidiaries abroad,

including 692 in the Cayman Islands, 119 in the Turks and Caicos, 43 in Mauritius and 8 in Bermuda.

Two Enron subsidiaries have been accused by a group of insurers of engaging in sham transactions in a tax haven, according to court papers in a New York lawsuit.

By no means is Enron alone in not paying income taxes. A small but growing percentage of large companies pay no income taxes, a study by Citizens for Tax Justice showed in October 2000. The study of half the Fortune 500 companies found that 24 owed no tax in 1998, up from 13 in 1997 and 16 in 1996.

While it is common for American companies to create subsidiaries in tax havens abroad, Enron had far more than most other companies, tax experts said.

Dynegy, a Houston competitor of Enron in the energy trading business, said yesterday that it had no subsidiaries in tax havens. In disclosure reports, Chevron lists three subsidiaries in tax havens, and Exxon Mobil lists six.

TECHNIQUES QUESTIONED

The tax haven subsidiaries enabled Enron to create partnerships to eliminate taxes using techniques that came under attack from the Treasury Department and the Internal Revenue Service during the Clinton administration.

The basic technique involves having profits go to a partner not subject to American income taxes, such as a bank in a country that is a tax haven. The partner, after taking its fee, then returns the profits in a form that is recognized as not taxable by American law.

Enron avoided taxes for another big reason: deductions for stock options. When executives exercise stock options, the company takes a deduction on its corporate income tax return equal to the profit realized by the executive, even though it is not required to show an expense on its profit-and-loss statement to shareholders. The benefits to the company can be great, particularly if a soaring stock price leads to the exercise of large numbers of options. That was true at Enron when its shares were soaring from 1998 through 2000.

It is not clear from Enron's financial reports how much the tax haven operations reduced the company's taxes. But Enron did disclose that deduction for stock options alone had turned what would have been a tax bill of $112 million in 2000 into a refund of $287 million.

HUNDREDS OF MILLIONS IN REFUNDS

Indeed, the company paid taxes in only one of the years between 1996 and 2000, while the government paid the company hundreds of millions of dollars in refunds.

The analysis of Enron's tax payments was performed by Citizens for Tax Justice, an organization that is backed by labor unions. Its calculations are widely accepted by groups with sharply different views, such as the Heritage Foundation.

Mark Palmer, an Enron spokesman, said yesterday that he was unable to comment on the tax issues.

International tax experts say corporations create offshore subsidiaries in tax havens for a variety of legitimate reasons, including keeping profits earned overseas from being taxed in the United States, avoiding American regulation and insulating foreign business partners from American tax law.

These havens are also attractive because they do not require companies to disclose anything about their financial dealings.

"The object was to not pay taxes in any country where it operated," said one international tax lawyer who insisted he not be named because he has worked on Enron matters.

"You certainly do not want to pay U.S. taxes on income earned in another country," he said. The lawyer was critical of Chevron and Exxon Mobil for not following Enron's example to avoid taxes, saying "it is neither illegal nor unethical."

SPREADING LIABILITY

The chairman of the American Bar Association tax section, Richard Lipton, said the creation of hundreds of subsidiaries showed that Enron sought to "spread legal liability and reduce the possibility that if one partnership goes bad, it will not infect any others." He said this would give comfort to other partners, such as banks, dealing with Enron.

Lipton said the existence of so many subsidiaries "raises only an eyebrow, not an alarm, but any allegation of shams raised by an insurance company is a red flag."

Just such an accusation is raised in filings by Continental Casualty Co. and other insurers in Enron's bankruptcy proceedings in New York. The insurers do not want to pay on bonds guaranteeing a deal involving Enron and two tax haven companies. The insurers have refused to pay because they think the deal may be a sham, they say in their court papers.

Thursday, Jan. 17, 2001 11:03 a.m. EST

Leahy: Enrongate Shredder Has FBI Contract

Arthur Andersen LLP, the company now battling for its survival in the wake of revelations that it shredded Enron documents last fall, has a $1 million contract with the Federal Bureau of Investigation that could give it access to information about the bureau's Enron probe, Sen. Pat Leahy, D-Vt., head of the Senate Judiciary Committee, revealed Wednesday.

"Now, unfortunately, the problem we're going to have is that Attorney General Ashcroft has also hired Arthur Andersen to do about a million-dollar review of the FBI for their reorganization," Leahy revealed in a Vermont radio interview.

The Vermont Democrat said that while he didn't disagree with the decision to hire a good accounting office to help revamp the bureau, he complained, "Unfortunately, Arthur Andersen now has access to some very sensitive things in the FBI at the same time where I'm going to be calling on the FBI to help my committee investigate why Arthur Andersen destroyed material.

"As I'm using some of the FBI agents to help investigate Arthur Andersen," he added, "I want to make sure the fact that Arthur Andersen is at the same time helping with the reorganization of the FBI doesn't get one caught over the other."

Leahy made his comments on WVMT's "Charlie and Ernie in the Morning" show.

The Senate Judiciary Committee chairman has asked the Justice Department to determine whether "any actual or apparent conflicts of interest" exist in Andersen's relationship with the bureau.

Attorney General Ashcroft has recused himself from the Justice Department's Enron probe because he accepted contributions from the energy giant during his Senate bid two years ago.<P.

Thursday, Jan. 17, 2001 11:03 a.m. EST

Leahy: Enrongate Shredder Has FBI Contract

Leahy made his comments on WVMT's "Charlie and Ernie in the Morning" show.

The Senate Judiciary Committee chairman has asked the Justice Department to determine whether "any actual or apparent conflicts of interest" exist in Andersen's relationship with the bureau.

Attorney General Ashcroft has recused himself from the Justice Department's Enron probe because he accepted contributions from the energy giant during his Senate bid two years ago.

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