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White House Says Bush's Loans Were Legitimate

Aired July 11, 2002 - 14:19   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.
KYRA PHILLIPS, CNN ANCHOR: And, we harken back to Mr. Bush's boardroom days for a story about some loans that President Bush wants to ban.

CNN's John King is live from the White House with the facts and the figures on those -- John.

JOHN KING, CNN SENIOR WHITE HOUSE CORRESPONDENT: Well, Kyra, the bottom line from the White House is that the scandals now, four steps that might not have been necessary back when Mr. Bush on that board of Harken Energy, or even just a few months back for that matter.

But these are the details: we know the president a board director, as we just noted there, of an energy company in Texas called Harken Energy back in 1996, and then, again, in 1998. Mr. Bush took out two loans, two low-interest loans, direct from the company. They totalled a little more than $180,000, and he used that money to buy stock in the company. Now that is not an uncommon practice, companies loaning money to their own board members and directors to encourage them to invest in the company they manage.

But, it is under scrutiny now because Mr. Bush, in his speech on Wall Street earlier this week, said that in his view, those loans now should be illegal. The White House saying Mr. Bush's loans were perfectly proper, that he repayed them, that it was fully disclosed to the Securities and Exchange Commission at the time, reported on in Mr. Bush's past political campaigns.

They draw this distinction. They say post-Enron, post-WorldCom, the government must take new steps to inspire investor confidence. So the White House says there is nothing at all wrong here, some Democrats, though, think the president has some explaining to do.

(BEGIN VIDEO CLIP)

REP. RICHARD GEPHARDT: One, I think that it -- we've learned over the years the best way to handle any of these kind of things is get the facts out on the table, and that's what I hope he will do, and think he ought to do for everybody's good. Secondly, it is -- it is hard to lead when you haven't done the things that you're asking others to do.

(END VIDEO CLIP) KING: Now, the White House sees politics in comments like that, saying the facts have been out on the table, have been reported on, and disclosed to the government for more than a decade, but the White House says that the Democrats are trying to focus on the president's past to stir up some dust, and to get some political gain in this corporate responsibility debate.

It is not something going unnoticed here at the White House. It is not that they are not concerned about the focus on the president's past, but I must tell you, much more of a sense of urgency here at the White House not about looking back at the president's past, but at looking forward, another terrible day on Wall Street today. White House aides much more worried about that, believing that if the economy does not start to rebound, if investors don't get more confidence in the markets, the president's party, that would much more of a political issue come November than anything the president did in his business past -- Kyra.

PHILLIPS: John King, thank you.

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