Return to Transcripts main page

CNN Live Saturday

Congressman Henry Waxman Demands Answers From Enron Executives

Aired January 12, 2002 - 20:01   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
CAROL LIN, CNN ANCHOR: But right now we begin this hour with more questions about Enron, the energy giant that made history last month by becoming the largest U.S. company ever to file for bankruptcy. Thousands of Enron employees lost all of their 401(k) savings when the company collapsed. Well, today, one key lawmaker is demanding answers about the message management was giving to Enron's employees.

CNN White House correspondent Kelly Wallace has more.

(BEGIN VIDEOTAPE)

KELLY WALLACE, CNN WHITE HOUSE CORRESPONDENT (voice-over): Democratic Congressman Henry Waxman sent a letter to Enron Chief Kenneth Lay Saturday, questioning e-mails that Lay apparently sent to Enron employees in August, the day Enron CEO resigned, saying, quote, "Our performance has never been stronger. Our business model has never been more robust." The e-mails were sent, according to Waxman, just two months before Lay called Treasury Secretary O'Neill and Commerce Secretary Evans to say his company was in financial trouble.

Waxman tells Lay, if the e-mails are genuine, quote, "they create the appearance that you misled Enron employees about the value of their investments." Waxman not only wants answers from Lay, but is questioning what the two cabinet officials and a top Treasury Department official, Peter Fischer, who was also contacted by an Enron executive, knew about the energy company's financial situation before it collapsed.

The White House continues to say Bush advisers acted appropriately by not intervening to bail out the company.

LAWRENCE LINDSEY, WHITE HOUSE ECONOMIC ADVISER: American capitalism is not crony capitalism. In America, when a company makes a mistake, even when it's a big company, even when it's well politically connected, that company bears a responsibility for its decision.

WALLACE: But will this become a political issue this election year, when control of Congress is at stake? Democrats face a delicate balancing act, pressing for answers without appearing too partisan.

SEN. JEAN CARNAHAN, (D) MISSOURI: I don't want a political shouting match. I don't think that's good for the nation. WALLACE: There are (UNINTELLIGIBLE) to Democrats. Along with Mr. Bush and Republicans, Democratic lawmakers also received money from Enron. And a top Democrat, Former Treasury Secretary Robert Rubin, called Fischer at the Treasury Department last fall asking if the administration plans to help Enron.

But Democratic strategists say they still plan to use Enron to charge the Bush administration is a champion of special interests. And analysts say there could be a perception problem.

AMY WALTER, COOK POLITICAL REPORT: And the perception for the American people that the White House, that Republicans care a lot more about the interests of their corporate friends than they do about average Americans. And that's when it becomes a political problem for the White House.

WALLACE (on camera): But aides doubt this will be a political problem for Mr. Bush. Still, at a time when the administration wants to focus on its domestic agenda and the war on terror, it is forced to answer questions about Enron, taking the White House, it seems, off message for the first time since the September 11 attacks.

Kelly Wallace, CNN, the White House.

(END VIDEOTAPE)

LIN: And we now have a reaction from Enron, from a spokesman who asked that we not give his name, because he did not want to receive what he calls "an onslaught of calls" tonight. But according to the spokesman for Enron, he says in reaction to Senator Waxman's letter, "It is no surprise that Mr. Lay's comments to employees in August would have reflected the same views that the company was expressing publicly at the time. That was, in fact, Enron's view of its condition in August. We had 21 consecutive quarters of earnings growth behind us." This according to an Enron spokesman.

TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com