Enron's reach in Congress
The company's deep connections to both parties renews calls for campaign-finance law.
As evidence of the reach of Enron's political tentacles continues to mount, the question in Washington may no longer be "Who had ties to Enron?" but "Who didn't?"
Campaign-finance figures show that in recent years, the Houston-based energy company poured money not only into the campaign coffers of George W. Bush but also into those of many members of Congress.
While more than two-thirds of the company's donations have gone to Republicans, a number of top Democrats have received Enron cash as well - a fact that could complicate the party's efforts to capitalize on the scandal in the 2002 elections.
So far, there's no indication that Enron called on any lawmakers to intervene on its behalf in the days leading up to the bankruptcy.
But there is some evidence that Enron's interests were served on a variety of other issues in the past - such as the White House's energy plan and its
proposed repeal of the corporate alternative-minimum tax - both of which have passed the House.
While this may be well within the bounds of the law, it's the appearance of undue influence that could ultimately prove damaging - a realization that has clearly struck lawmakers from both parties, many of whom are hastening to return Enron's donations.
As a result, analysts say the real impact of the probes may be less political than substantive - in that it may reinforce the push for campaign-finance reform.
"What's coming through as a result of Enron is not necessarily what the Democrats want," says Larry Sabato, a political scientist at the University of Virginia. "The message that is coming through is that they are all bought."
One challenge, some experts say, is that some of the people whose campaigns have benefitted from Enron's largess are now tasked with investigating the floundering giant and its Washington connections.
No fewer than eight congressional committees are already investigating the debacle, with more likely to take up the issue in coming weeks. Insiders say the investigation will focus on federal oversight of energy trading markets, as well as accounting practices.
The company prospered - and then plunged - largely outside the view of federal regulators.
The probes will examine ties between Enron and the Bush administration, key legislators, and others. Some critics, for example, have questioned the actions of Wendy Gramm, the wife of Texas Sen. Phil Gramm (R), one of the Senate's strongest advocates of deregulation. Mrs. Gramm, as chairman of the Commodity Futures Trading Commission, proposed a rule to exempt energy swaps from federal oversight.
The rule was subsequently adopted - after which she resigned to join Enron's board of directors. Enron has contributed $233,000 to Senator Gramm's campaign since 1996, according to the Center for Responsive Politics, a nonpartisan group that tracks money in politics.
Gramm isn't the only member of Congress with ties to the company. According to the Center for Responsive Politics, 71 sitting senators and 188 sitting members of the House have received money from Enron over the past 10 years, including Democrats as well as Republicans.
Democrat Charles Schumer of New York received more than $21,000 during his campaign to defeat Sen. Al D'Amato. In his campaign, Mr. Schumer supported deregulating electricity as a way to lower consumer prices.
These types of donations, say analysts, while not illegal, can create a perception of impropriety. "Enron has cast into stark relief the whole issue of Washington drowning in soft, unregulated money," says Marshall Wittmann, an analyst at the Hudson Institute. "It is a story of soft money buying access to both parties."
As a result, the Enron affair could create a renewed push for campaign-finance reform on the Hill. A measure to ban soft money contributions passed the Senate last summer, then stalled in the House. But it has been gaining momentum in recent weeks - and now needs only four signatures to force a vote in the House.
"Enron does help the cause of campaign finance," says Rep. Christopher Shays (R) of Connecticut, one of the bill's cosponsors. "It shows that large corporate-treasury money has brought them access in the ways that large contributions always do."
He concedes that large firms, inevitably, will have some access to government officials. "A company like Enron is going to have access by the fact of what it is and what it does. But in the end, there shouldn't be such vast sums of money going into the ... process."
And while the rules currently allow for such contributions, a number of lawmakers are nevertheless scrambling to return their Enron donations.
Two Democrats - Sen. Jean Carnahan and House minority leader Richard Gephardt, both of Missouri - have already promised to return $1,000 contributions they received from the energy company, and the National Republican Congressional Committee is returning $100,000.
President Bush has been opposed to campaign-finance reform, but some analysts say the Enron fallout may cause him to change his position. Less certain is Enron's impact on the 2002 congressional races. Most of the top recipients of Enron cash in the Senate are not up for reelection this year. All House members are.
And in the Senate race with the biggest links to Enron - the race to succeed Gramm in Texas - the effect could cut both ways. The GOP candidate, Attorney General John Cornyn, has recused himself from the Justice Department's probe because he has received more than $150,000 from the company, while the leading Democrat, Rep. Ken Bentsen, has received more than $42,000 - the most of any House member.