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American Morning
Interview with Greg Valliere
Aired July 12, 2002 - 07:41 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.
PAULA ZAHN, CNN ANCHOR: President Bush is scheduled to meet with his corporate fraud task force at the White House today. The meetings come as both the president and vice president are taking political heat for what they did as corporate executives before they took office; the president over corporate loans when he was on the board of Harken Energy, and Vice President Cheney for dealings at the Halliburton Corporation.
While he was at the Halliburton Company, Cheney also made a videotape praising the now-disgraced accounting firm, Arthur Andersen.
(BEGIN VIDEO CLIP)
RICHARD CHENEY, VICE PRESIDENT OF THE UNITED STATES: I get good advice, if you will, from their people based upon how we're doing business and how we're operating over and above just sort of the normal by-the-books auditing arrangement.
(END VIDEO CLIP)
ZAHN: The tape was made while Mr. Cheney was CEO of Halliburton, an oil services company that is being sued over its accounting practices. Political economist, Greg Valliere, joins us now from Washington -- welcome -- nice to see you this morning.
GREG VALLIERE, POLITICAL ECONOMIST: Great to see you, Paula.
ZAHN: So, Greg, other than the embarrassment that the administration may suffer from all of this, can the Democrats get much mileage out of this tape?
VALLIERE: They may. Now, I'm a little cynical, because it's an election year, and clearly, they will try to play it up. I think the Democrats run a risk of overplaying their hand. If they get too sanctimonious, if they start sounding like Ralph Nader on business ethics, that could actually hurt them, in my opinion.
ZAHN: How?
VALLIERE: Well, I think that we now have a nation of stockholders. A majority of adult Americans own stock. And if the Democrats really talk aggressively against business, again, if they sound like Ralph Nader, I think a lot of these stockholders may feel they are going overboard. ZAHN: Let's go on to the issue of this lawsuit that the conservative legal watchdog group, Judicial Watch, has just filed against Dick Cheney and Halliburton, the company he just won -- ran. In essence the man who filed the suit says what the company alleges -- or the complaint alleges is that Halliburton, its directors and Arthur Andersen came up with "a scheme, a plan of conspiracy," these are his words, "to falsify its financial earnings to the American people, inducing the American people to make investments."
VALLIERE: Well, the watchdog group that filed the suit is very controversial. I take them with a grain of salt. But there are going to be lots of suits around the country against firms. I think for the vice president, he can claim that he relied on the advice of their accountants. Unfortunately for Cheney, the accountant was Arthur Andersen. So as you said at the beginning, there is an embarrassment factor here.
ZAHN: But the fact that it is being filed by a conservative group and not a liberal group...
VALLIERE: Yes.
ZAHN: ... does it not give the Republicans maybe more headaches right now?
VALLIERE: Yes, it sure does give them headaches. I think, though, that both parties have received money from firms that are suspect. I think that if you live in glass houses, as many people in Washington do, you have to be careful if you throw stones.
ZAHN: We should make it clear the White House is calling this suit utter nonsense. But where do you see the fight going from here? Do you see a situation where the vice president gets deposed, and he's going to have to see that play out on national television?
VALLIERE: It sure doesn't, to me at least, smell like a major scandal that could mean his undoing. Again, it's embarrassing. I think very quickly for the financial markets, Paula, I think this story is in the markets. I think the markets will now move on to the next story. I think the next story is that corporate earnings are starting to look pretty good.
ZAHN: Well, let's move on to the president now before we let you go. Dick Gephardt having this to say about some low-interest loans that then businessman Bush received from Harken Energy. Here is what Dick Gephardt had to say.
(BEGIN VIDEO CLIP)
REP. RICHARD GEPHARDT (D), MINORITY LEADER: It is hard to lead when you haven't done the things that you are asking others to do.
(END VIDEO CLIP)
ZAHN: So essentially, you've got the Democrats out there saying that, in fact, the president, when he was a businessman, benefited from the same kind of coziness he now says must stop. Does that not weaken his ability to seize the bully pulpit?
VALLIERE: Yes, and I'll tell you, Paula, this is a town that is addicted to the polls, and if the polls show that Bush has been weakened in this area, it means the Democrats will be even more on the offensive for things like the aggressive Sarbanes bill. Right now, I think that Congress will pass some very aggressive bills, because the Republicans are so on the defensive.
ZAHN: So do you think this is going to continue to be a hot issue over the next couple of weeks? Or do you see this Harken Energy thing dying?
VALLIERE: I think, since we have an election on November 5, it will probably stay in the limelight until then. Although again, I think for the stock market, I think the story now is fairly discounted.
ZAHN: Greg Valliere, thank you for your insights this morning.
VALLIERE: OK.
ZAHN: Glad to have you with us on AM.
VALLIERE: You bet.
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