Party of the People?

by Evan Maloney

The recent revelation that Al and Tipper Gore tried to use their notoriety to finagle free tickets to a Bruce Springsteen concert illustrates a hypocrisy common among Democrats. According to Fox News, "Tipper tried to get free tickets to the Springsteen show for the entire Gore staff. That didn't work, and she was then told even paid admission would be hard to come by." An unnamed source connected to Springsteen's tour added, "They wound up being offered four [tickets]. But when they were asked to pay $75 apiece, they said forget it."

Remember this behavior as the Democrats spend the days leading up to November's elections talking about power, about undue influence, about people trying to cut corners and being granted favors. Remember this behavior from the Gores, who just two years ago were selected to be the standard-bearers of the Democratic Party, the self-proclaimed Party of the People.

In reality, the Democrats are the party of people like billionaire John Corzine, who recently bought himself a Senate seat in New Jersey with money he collected at Goldman Sachs. While Corzine was CEO of Goldman Sachs, the company did more business with Enron than any other Wall Street firm. The Democrats are the party of people like Maria Cantwell who--in her high-profile position at RealNetworks--had the good fortune of getting caught in a rising dot-com bubble that inflated her net worth to $50 million. Like Corzine, Cantwell also plowed millions of her own money into her campaign, resulting in the successful purchase of a Senate seat in Washington State. Meanwhile, the small investor was left holding the bag as Cantwell's RealNetworks plunged in price from $93 a share to under $5 today.

The Democrats are the Party of the People, right?

Glass Houses

Anyone who has followed the accounting scandals closely knows when the bulk of the crooked accounting started: the second half of the 1990s, under Clinton, whose administration looked the other way when the bogus bookkeeping of Cendant and Sunbeam came to light. Investors know that the stock market collapse started in the spring of 2000, nearly a year before President George W. Bush was sworn in. And economists know that the recent recession started that spring as well, while Bill Clinton was President.

Clinton did nothing about the executives who got caught cooking the books under his watch. Clinton also demonstrated to the devious that slick wording makes the notion of truth quite malleable. After all, if the President of the United States declares the meaning of the word "is" to be under dispute, who's to quibble with questionable accounting transactions that are probably too complicated to ever be understood? With the lessons taught by the Clinton presidency, is it any wonder that executives thought they could get away with pretty much anything?

When crooked executives are discovered now, the Bush Administration hauls them off in handcuffs. Under Clinton, nothing happened. And somehow, Democrats can say with a straight face that they'd be more effective in preventing business scandals, that they should be entrusted to oversee corporate America, and that they're most capable of cleaning up the mess.

If they are, they should clean up their own mess first. They can start with the mess left by the man running their party, Terry McAuliffe, Clinton's top fundraiser, who has spent much of his career dogged by financial scandal. His recent work involves the demise of Global Crossing, one of the largest bankrupcies in American history. Another mess left by Robert Rubin, Clinton's Treasury Secretary, involves asking government officials for favors in order to help Enron. Despite months spent covering both of these collapses, the media has managed to steer clear of widely reporting the work of these scandal twins.

Terry McAuliffe

Terry McAuliffe, as the Chairman of the Democratic National Committee, is the leader of the Democratic Party. McAuliffe has been at the forefront of trying to tie the Enron scandal to President Bush. In calling for an investigation on Enron, McAuliffe said on CNN This Weekend, "The people out there who are hurt the most are the small people, and once again the wealthy special interests got to take their money off the table, and that's what we need to investigate."

But with Global Crossing, McAuliffe turned a $100,000 investment into $18,000,000--an increase of 17,900%--and managed to take his money off the table before the bottom fell out. But instead of showing the same compassion for "the small people" and the same anger at "the wealthy special interests" in this case, McAuliffe had a rather simple answer explaining his astounding Global Crossing profit-taking: "That's capitalism. If you don't like it, move to Cuba."

McAuliffe also arranged for Global Crossing CEO Gary Winnick to play golf with Bill Clinton in 1999. Shortly thereafter, Winnick made a $1,000,000 contribution to the Clinton Presidential Library. The Clinton Administration then awarded Global Crossing a contract with the Pentagon that was later cancelled and is now under investigation because, as one insider put it, "it didn't smell right."

Robert Rubin

Now, this is not to say that there weren't political insiders pushing for favors for Enron; there most certainly were. It's just that the favors were sought by Clinton Administration officials like Robert Rubin, who served as the Secretary of the Treasury from 1995 to 1999. On 8 November 2001, Rubin placed a call to Peter Fisher, the current Undersecretary of the Treasury. According to New York Magazine, Rubin asked Fisher for a favor on behalf of Enron:

Hey, Peter, this is probably not such a good idea, but what do you think about putting a call in to the ratings agencies? Maybe they could work with Enron's bankers to see if there might be an alternative to an immediate downgrade.

This is a major scandal: a former Treasury Secretary asked a government official to call private debt rating agencies and try to talk them out of downgrading Enron's debt, even though Enron was clearly on the brink of collapse. Rubin, a Clinton official, called a Bush official to request that he use inappropriate influence to help Enron. If the Bush Administration was so beholden to Enron, why didn't it grant that favor to Enron? If the Bush Administration was so cozy with Enron, why did it let Enron go out of business?

Throwing Stones

As the Rubin call suggests, Enron was far closer to the Clinton Administration than it was to the Bush Administration. The Washington Times reported that between 1993 and 2000, Enron asked the Clinton Administration to underwrite foreign loans twenty times. Nineteen out of those twenty times, the Clinton Administration approved the loans, to the tune of over $1 billion. During that same time, Enron donated over $1 million to the Democratic Party. Hmmm.

These are clear examples of the Clinton Administration doing favors for Enron. Not once has anyone come up with a single example of the Bush Administration doing a favor for Enron. (Some people cite the fact that the Bush Administration invited Enron to discuss energy policy, but not only did the Clinton Administration do the same thing, it turns out that groups like Greenpeace and the Sierra Club were also invited.) Given the track record of the Democrats, where do they get the chutzpah to be lecturing anybody on corporate corruption?

Now, I'm not saying that the Republicans are perfect, but Democrats seem interested in (and the media is letting them get away with) pinning the blame on Republicans for a decay that has infected our economy and corporate culture for years, a decay that started under a Democratic president who did plenty to encourage it. No party has a monopoly on power-hungry people, on influence peddlers, on corner-cutters, hucksters or tricksters. The Democrats obviously inhabit glass houses, so maybe they should cut down a little on the rock throwing.

Copyright 2002, Evan Coyne MaloneyAll Worldwide Rights Reserved