(Editor's Note: This is the second of a three part series detailing some of the Enron Corporation's ties to the Clinton Administration between 1992 and 2000.)
(CNSNews.com)- Enron Corporation benefited from an eight year relationship with the Clinton administration and used that clout to successfully lobby for tax credits, subsidies and other favorable legislation, according to documents obtained by CNSNews.com and authenticated by the company.
And while Congressional Democrats try to link the now-bankrupt corporation with the Bush administration and the Republican Party, there is evidence that Enron actually aligned itself with the environmental lobby, which put the company squarely at odds with most of the GOP on climate change issues.
While touting its relationship with militant environmental groups including Greenpeace, Enron worked to strengthen and preserve certain funding programs that helped finance hundreds of billions of dollars in Enron projects around the world during the years Bill Clinton was in the White House, documents show.
In fact in 1997, Enron joined forces with the Clinton administration to defend the federal Overseas Private Investment Corporation (OPIC) from budget cuts in Congress.
The agency had provided Enron with both funding and, in 1996, $200 million in "political risk insurance" for Enron's Dabhol Power plant in India, which had also been funded in large part by OPIC.
In efforts to save the agency from cuts, OPIC President Ruth R. Harkin announced the Clinton administration was solidly behind the agency and would not allow it to be the victim of budget cuts, according to the March 19, 1997 edition of The Oil Daily, an industry publication.
That month, Harkin requested a three-year, $9 billion increase in the agency's contingent liability cap to aid U.S. corporations, and Enron Senior Vice President for Global Affairs Linda F. Powers warned that if OPIC did not receive sufficient funding, the U.S. economy would suffer, according to The Oil Daily.
"If programs like OPIC were not available, we would have no choice but to move our sourcing to other countries where financing is available," Powers stated on March 18, 1997 to the House International Relations Subcommittee on International Economic Policy and Trade.
But another witness testified before the same committee that OPIC was nothing more than a "corporate welfare agency."
Tom Schatz of Citizens Against Government Waste stated that OPIC was only benefiting corporations at the expense of American taxpayers.
A follow-up memo dated Sept. 17, 1997 from Enron Vice President Joe Hillings and Vice President of Global Project Finance John Hardy, noted that both the Senate and House had passed the appropriations bill for OPIC, but it was awaiting authorization in the House International Relations Committee.
The memo expressed frustration with House Majority Leader Richard Armey (R-Texas) for not making the OPIC bill a "first tier priority," but noted that the House Congressional Black Caucus "was helpful in the consideration of the OPIC appropriation," and that Black Caucus members felt "Africa deserves more attention in export financing."
Kyoto Protocol is Good for Enron
The Kyoto Protocol on climate change represented an opportunity for Enron to make a profit, because the carbon dioxide requirements of the treaty dovetailed with numerous corporate projects that emitted less CO2 and other greenhouse gasses.
Vice President Al Gore championed the Kyoto Protocol, which would have required 40 industrialized nations to drastically reduce greenhouse gas emissions by the year 2012.
Toward realizing that opportunity, Enron Chairman Kenneth Lay applauded Clinton's support for the Kyoto Protocol in an Oct. 22, 1997 corporate statement, calling it "a comprehensive, yet realistic, program that starts to move the United States and the world toward minimizing carbon dioxide emissions."
Lay liked the emission targets and incentives to develop new energy and environmental technology as well as the "carbon dioxide trading program."
Enron was invested in both natural gas energy alternatives and wind power technologies, both of which fit the profile of what the Kyoto Protocol demanded, and the company needed little prodding when it came time to support the global warming treaty.
John Palmisano, senior director for environmental policy and compliance at Enron, wrote in a Dec. 12, 1997 internal memo regarding Kyoto, that "if implemented, this agreement will do more to promote Enron's business than will almost any other regulatory initiative outside of restructuring of the energy and natural gas industries in Europe and the United States."
In the memo, Palmisano also promoted the carbon emissions trading provisions in the Kyoto treaty and said the "additional demand for renewable technology is enormous."
"Enron has immediate business opportunities which derive directly from this agreement," he wrote. Palmisano envisioned that the Clinton administration would be receptive to any of Enron's policy goals. "I do not think it is possible to overestimate the importance of this year in shaping every aspect of the agreement," Palmisano declared.
He then wrote that the Kyoto Protocol represented a victory for Enron's lobbying efforts. "The endorsement of joint implementation within [the Protocol] is exactly what I have been lobbying for and it seems like we won," Palmisano wrote. "The endorsement of emissions trading was another victory for us."
Palmisano praised the carbon trading with "transitional economies" because "this means that Enron projects in Russia, Bulgaria, Romania or other eastern countries can be monitized (sic) ..."
Enron Trumpets Inroads With Greens
Besides enjoying a close relationship with the Clinton administration, Enron also cultivated friends in the environmental movement. Palmisano, in the Dec. 12, 1997 memo, boasted that because of its support for climate change treaties, "Enron now has excellent credentials with many 'green' interests including Greenpeace, [World Wildlife Fund], [Natural Resources Defense Council], German Watch, the U.S. Climate Action Network, the European Climate Action Network, Ozone Action, WRI, and Worldwatch."
Palmisano continued, "This position should be increasingly cultivated and capitalized on (monitized). (Parenthetically, I heard many times people refer to Enron in glowing terms. Such praise went like this: 'Other companies should be like Enron, seeking out 21st century business opportunities' or 'Progressive companies like Enron are ...' or 'Proof of the viability of market-based energy and environmental programs is Enron's success in power and [sulfur dioxide] trading.')
He ended the memo regarding the Kyoto Protocol by stating, "I predict business opportunities within 18 months." The final line reads, "This agreement will be good for Enron stock!!" (sic)
Enron also used its "excellent credentials" with environmental groups to help lobby the Clinton administration for tax breaks on development of wind energy technologies.
A Nov. 3, 1999 Enron statement boasted that the environmental group, "National Audubon Society today praised Enron Wind Corp." for an agreement to re-locate a wind-powered generating facility to accommodate an endangered species.
According to the statement, "the agreement directly benefits the California condor recovery effort while facilitating a wind power project that would provide green energy to the Los Angeles area."
But the Audubon Society did not only publicly praise Enron. It also engaged in lobbying for tax breaks to benefit the company.
"The National Audubon Society has also announced that it unconditionally supports the Wind Energy Protection Tax Credit and will seek to convince legislators to pass the measure," Audubon Society Sr. Vice President Dan Beard said in a statement.
Further evidence of Enron's ties to environmentalists was revealed when Lay used a meeting of the environmental group Nature Conservancy to announce new wind power initiatives, according to a Nov. 18, 1997 Enron statement.
In announcing the wind power program, Lay told the group, "The cost of entry for companies to make the claim to be environmentally friendly is their commitment to add incremental generation of renewable energy."
Wednesday: Meshing the agendas of Enron and the Clinton administration.
Part One: Enron and the Clinton Administration: Ties That Bind
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