Bush In The Glare

By Karen Tumulty With Reporting by James Carney and Adam Zagorin

It was supposed to be a week in which George Bush made common cause with the common man, a week of speeches and photo ops to show that the President who whipped the Taliban could also save our jobs and fix our schools. But when a gust of news blew the Enron mess from the business section to the front page, the country saw a tense, cautious President trying his best to distance himself from one of his biggest campaign contributors, the friend he used to call "Kenny Boy." In the Oval Office on Thursday, Bush told reporters he hadn't seen "Mr. Lay" since last spring.

So far, there is no evidence that anyone in the Administration did anything wrong or that the half a million dollars that Lay and his fellow Enron executives invested in Bush's political career over the years bought them any special favors. But Bush knows he stands in the line of fire. Democrats have been unable to hang the recession on him, but many hope that Enron's hapless employees--whose retirement nest eggs vaporized even as their bosses were selling off more than $1 billion of their own stock--become the image that sticks. The Enron debacle goes to one of the most basic questions Americans ask about their President: Whose side is he on? Pre-September surveys showed a hardening perception that Bush doesn't care about the concerns of the average person. In a New York Times poll last June, 57% of those surveyed said the Administration's policies favored the rich, and 63% said Bush was a "typical Republican." Though his public approval soared after Sept. 11, White House officials fear Bush has not entirely shaken the idea that he cares more about corporations than about the people who work for them. Kenny Boy reminds folks of that.

The Enron mess has reawakened Washington's instant scandal culture, with the entirely predictable twist that Democrats and Republicans have exchanged their well-practiced roles. But there's one obvious comparison that Bush's advisers are at great pains to deny. "There is no war room, no task force, no team of lawyers working day and night to battle the Democrats," says an aide. "This is not the Clinton White House." The Administration finally disclosed last week how many meetings Enron representatives had last year with Vice President Dick Cheney or his staff--six, including one as late as October, when Enron was going down the tubes, although those officials say they never discussed its fortunes. But the Administration continues to fight General Accounting Office efforts to find out who else Cheney talked to when he was developing his energy plan. A GAO lawyer told TIME the agency is hiring attorneys "with Supreme Court experience" in the event that it proceeds with a federal lawsuit to force Cheney to divulge the material.

Bush was not above a little Clintonesque shading of the truth last Thursday as he described his relationship with Lay. "He was a supporter of [Democratic incumbent Governor] Ann Richards in my run in 1994," said the President, adding that he got to know Lay after that. This came as a surprise to a great many people in Texas, as Lay and his wife contributed $47,500 to Bush's campaign that year (and a mere $12,500 to Richards') and Enron's political-action committee and executives donated nearly $100,000 more to Bush, according to the watchdog group Texans for Public Justice. Lay had even contributed to Bush's unsuccessful race for Congress in 1978.

Amid all their self-congratulatory talk about being forthcoming--getting "in front of the story," as it's known in Washington--Bush officials insist they see nothing odd about the idea that it took nearly three months for Commerce Secretary Don Evans and Treasury Secretary Paul O'Neill to inform the White House that Lay had come to them seeking help as the company was going under. If the White House's story is so clean--Enron asked; we said no--why wait three months to tell it?

Last week news of the calls to Evans and O'Neill kicked the Democrats into high gear, targeting Bush as an enemy of the little guy. The White House, said Democratic Congressman Henry Waxman, "had knowledge that Enron was likely to collapse but did nothing to try to protect innocent employees and shareholders, who ultimately lost their life savings." And it's not just the Waxmans of the world that Bush has to worry about. Louisiana Republican Billy Tauzin, chairman of the House Energy and Commerce Committee, the first to announce a formal congressional probe, has already sent investigators to the Houston offices of both Enron and its accounting firm, Arthur Andersen.

No wonder Bush tried to change the subject last week. He spoke of fixing the 401(k) pension laws and regulations that let Enron's bankruptcy become a personal tragedy for its workers. Bush's first challenge is to convince Americans that he didn't use his influence to protect one of his biggest campaign contributors. His larger one is to convince them he will use that influence from now on to protect them from future corporate shell games. --With reporting by James Carney and Adam Zagorin