KWAME HOLMAN: Members of Congress drifted back to a rain-soaked capital today for their first session in more than a month. Congressional leaders trooped to the White House early for an opening day meeting with the President.
SEN. TOM DASCHLE: A new year brings a new opportunity to start over. We're going to do that and work in hopefully a very positive and bipartisan spirit.
KWAME HOLMAN: But as Congress reconvenes, one item overshadows everything else: The fresh round of hearings on the collapse of former energy giant Enron. At a late morning news conference on Congress' agenda, Senate Minority Leader Trent Lott was asked about the dominance of the issue.
SEN. TRENT LOTT: It could be a distraction. But look, this is the beginning of a new year. We have an opportunity here to get some things done that we need to do for the American people. Those things go on a separate track. So it could be, but I hope it won't be, and I expect it won't be a distraction.
Last month, without much fanfare, a handful of Congressional committees began investigating how Enron went from a multibillion-dollar energy-trading firm to bankruptcy and allegations of financial wrongdoing.
REP. RICHARD BAKER: We are here today to examine and begin the process of understanding the most stunning business reversal in recent history.
KWAME HOLMAN: A House subcommittee called on Joseph Berardino, the CEO of Enron's auditing firm, Arthur Andersen.
SPOKESMAN: It is an illegal act to withhold information from an auditor.
SPOKESMAN: Well, I understand that, and believe me, in my experience in Louisiana political life, having something be illegal is not necessarily a prohibition. (Laughter)
KWAME HOLMAN: But in recent weeks, Congress' interest in Enron increased substantially after news Enron officials knew about the company's massive losses months in advance, yet encouraged employees to keep their pension fund shares of Enron stock. Then came reports workers at the Arthur Andersen accounting firm shredded documents related to an audit of Enron, and yesterday, that workers at Enron's own Houston headquarters shredded documents. Today, no fewer than ten committees are preparing to investigate the Enron collapse and related issues. Veteran Congress watcher Thomas Mann says the upcoming hours and hours of Congressional hearings are warranted.
THOMAS MANN, Brookings Institution: Unlike most Washington scandals, this involves matters that ordinary citizens can understand: The disappearance of one's pension funds while the big boys at the top of the company cash out. The utter lack of reliability of information about the financial well-being of a company who... Which is attracting all kinds of investors, and I think finally, the close association of the CEO and chairman of the board of Enron with President Bush.
KWAME HOLMAN: Enron and its CEO Kenneth Lay were heavy contributors to President Bush's political campaigns over the last decade. But Enron's political contributions are a complicating factor for both Republicans and Democrats in Congress, as well. The nonpartisan Center for Responsive Politics reports that 187 of the 435 members of the House accepted a total of $600,000 from Enron and its officers from 1989 to 2001. In the Senate, 71 sitting members received $530,000 in campaign contributions from Enron during the same period. One of them was Joseph Lieberman of Connecticut, chairman of the Governmental Affairs Committee, which will have a central role in investigating what happened at Enron. He received $2,000 from Enron in 1994, and talked about it on the NewsHour last week.
SEN. JOSEPH LIEBERMAN: That was $2,000 out of about $5 million that I had to raise that year, so I don't feel at all affected by it. But you know what this all does show, Jim, is that this is a company obviously whose business relied in some sense on government regulation or lack of regulation. They were giving to everybody-- not everybody, but all around in both parties-- and it puts a taint, a cloud over all of us in government.
KWAME HOLMAN: Meanwhile, the effort to secure witnesses is underway. Today, a lawyer for David Duncan, accused by superiors at the Andersen accounting firm of destroying Enron documents, said Duncan will refuse to testify before a house panel tomorrow. The Energy and Commerce Committee also subpoenaed three other Arthur Andersen officials. For his part, Enron CEO Kenneth Lay has said he will keep a commitment he made to appear before the Senate Commerce Committee on February 4. In the Republican-controlled House, four committees plan to examine facets of an Enron scandal that touches on everything from private pensions to government regulation of financial markets. In the Senate, where the committee chairmen's gavels are in the hands of Democrats, seven panels have announced Enron inquiries thus far. That number raised the eyebrow of one Senate Republican leader, Don Nickles of Oklahoma.
SEN. DON NICKLES: I wasn't aware that we had seven Senate committees. I think that's too many. I think Senator Daschle needs to consolidate, and that's really his call. He needs to do it. But hopefully we'll have a focused review, not repetitive, redundant, House, Senate and multiple Senate committee investigations.
KWAME HOLMAN: The latest Enron hearings get underway tomorrow morning with simultaneous meetings of the Senate's Governmental Affairs Committee, and the investigations panel of the House Energy Committee.
May 25, 2012
