Bush Defends Cheney on SEC Probe
President Bush, faced anew with questions stemming from his administration’s close ties to big business, said Wednesday he expects Vice President Dick Cheney to be cleared by a Securities and Exchange Commission investigation into the accounting practices of the Texas firm Cheney once led.
“I’ve got great confidence in the vice president,” Bush said at the White House when asked about the probe of Halliburton Inc. “When I picked him, I knew he was a fine business leader and a fine, experienced man. And he’s doing a great job.”
During a joint press conference with visiting Polish President Aleksander Kwasniewski, Bush also rebuffed calls for more details of his own business practices as a Texas oil executive in the early 1990s.
Bush dismissed suggestions that he authorize the SEC to release the entire file of its inquiry into a 1990 stock sale he made, saying the transaction has been “fully investigated by career investigators” who found that “there was no case.”
The persistent questions were a reminder of the cloud that hovers over an administration laden with former captains of industry at a time when corporate executive behavior is under intense scrutiny as a result of a spate of accounting scandals.
So far, the scandals may not have seriously affected Bush’s standing. A Washington Post poll released Wednesday found his job approval rating standing firm at 72%--virtually unchanged from a month ago.
“I’m a little surprised, given the extent of the coverage,” White House Budget Director Mitchell E. Daniels Jr. told reporters during a breakfast meeting, adding that he regarded some of the coverage as unfair and distorted.
But some analysts believe that Bush--and Cheney--may have a harder time staying immune from the corporate-scandals fallout if the stock market keeps dropping.
A nationwide poll released Tuesday by Zogby International found some slippage for Bush, contrary to the Post survey.
Bush’s approval rating was 62% in the Zogby poll--still a strong showing, but the first time the figure had slipped below 65% since Sept. 11
“I think both [Bush and Cheney] will be dogged by this for some time, but especially Cheney,” said Larry J. Sabato, a University of Virginia political scientist. “That’s because the Halliburton controversy is “really quite recent, and it relates directly to the current overall scandal of corporate irresponsibility,” Sabato said.
On Capitol Hill, Democrats may conduct hearings on Halliburton’s accounting practices in the wake of a recent shareholders’ lawsuit filed by a conservative watchdog group alleging that the firm overstated its revenue by as much as $445 million from 1999 through 2001.
Halliburton officials have denied any wrongdoing, and the White House said the lawsuit by Judicial Watch lacks merit.
Among those calling for hearings is Rep. Henry A. Waxman of Los Angeles, the top Democrat on the House Government Reform Committee. Sen. Joseph I. Lieberman (D-Conn.), chairman of the Senate Governmental Affairs Committee, also said hearings may be in order.
At the White House, spokesman Ari Fleischer denounced the talk of hearings as “old-style politics” aimed at personal destruction.
Over the weekend, SEC Chairman Harvey L. Pitt, whom Democrats have accused of being too lax in enforcing securities laws, vowed to “follow the trail wherever it leads” in its Halliburton probe. “No one gets a pass,” he said.
The SEC in May disclosed that it was opening an investigation into the methods Halliburton used to account for cost overruns in construction jobs in a way that seemed to inflate profits.
Cheney left the company in August 2000 to become Bush’s running mate.
At the time, Cheney made an $18.5-million profit selling his Halliburton stock. Two months later, the firm revealed that its business was way off, causing prices to fall sharply.
To date, there have been no allegations of wrongdoing by Cheney.
When asked specifically whether he is confident that Cheney did nothing wrong at Halliburton, an energy services firm that he served as CEO, the president replied:
“Yes, I am.”
Jennifer Millerwise, Cheney’s press secretary, said the SEC has not contacted the vice president’s office. She also said it would be inappropriate for Cheney to comment on the probe.
The SEC investigation of Bush concerned his sale of stock in the Harken Energy Corp. for nearly $850,000. Bush served on the company’s board.
The stock sale occurred just weeks before the value plummeted. The sale led to an insider trading inquiry by the SEC, but the agency closed the investigation after finding “insufficient evidence” to proceed.
Unlike the Halliburton case, Sabato said, the Harken matter is unlikely to cause problems for the White House because it is 12 years old and there has been “at least a stab at an investigation by SEC.”
Despite the questions about Harken and Halliburton, Bush seemed in an upbeat mood during much of the 32-minute press conference, winking repeatedly at reporters in the East Room and making asides to several in the first row.
Bush earlier had welcomed Kwasniewski during a ceremony on the South Lawn, complete with a 21-gun salute and a review of troops.
Kwasniewski is only the second foreign leader to be accorded a state visit by Bush. The first was Mexican President Vicente Fox, feted at the White House almost a year ago.
In an Oval Office meeting, Bush and Kwasniewski discussed a range of issues, including greater cooperation on military and economic matters. Today, the pair of leaders are traveling to two Detroit suburbs to visit with Polish Americans. Their spouses are going to Philadelphia to tour the Polish American Cultural Center and the Philadelphia Academy of Fine Arts.
Times staff writer Janet Hook contributed to this report.
