When Dubya and Lay
Were as Closeasthis
Ex-CEO a top fund-raiser
since early '90s

By BOB PORT
Daily News Staff Writer

o hear President Bush talk these days, his relationship with former Enron CEO Kenneth Lay was merely a casual one — a politician and his distant supporter. In truth, Bush and Lay have maintained a close alliance for a decade.

A Daily News examination of their relationship found a pattern of mutual benefit that begins in Texas and moves to Washington. According to documents, interviews and past reports, Lay began to cultivate their friendship in 1989, and Bush grew to depend on Lay for campaign money.

Since Bush first ran for governor in Texas, Lay and his wife, Linda, have personally given Bush, his campaigns and his inauguration parties more than $610,000 — not from Enron Inc., Enron employees or an Enron political action committee, but from their own bank accounts.

Among the Bush-Lay ties:

Eight times, according to federal election records, Bush campaign staff and even Bush's parents flew on Enron corporate aircraft during the Republican presidential primary in 2000 — flights sometimes arranged personally by the future President.
Bush kept Lay as chairman of the Governor's Business Council in Texas, and Lay later spearheaded the President's campaign finance efforts there.
Lay was named one of Bush's "pioneers" — those supporters who hauled in $100,000 or more in donations of $1,000 or less. Over the years, Lay helped gather millions for Bush.
When asked to talk about the President's relationship with Lay, White House spokesman Ken Lisaius stuck to the official line, saying only: "Ken Lay has been a supporter."

"I would let the President's words speak for themselves," Lisaius also said.

Denials Sound Familiar

Craig McDonald, director of Texans for Public Justice, a campaign watchdog group in Austin, Tex., said Bush's behavior reminds him of former President Bill Clinton's early Monica Lewinsky denials.

It's as if, McDonald explained, Bush is stammering: "I did not have political relations with that man."


Kenneth Lay was a big-league player on the Dubya team.
In January 2001, it was an Enron corporate jet that carried former President George Bush to his son's inauguration — and to a huge party financed in part by the single biggest gift on record given by the Lays to Bush: $100,000.

So solid are the ties between the Lays and the whole Bush family that many Texans are shaking their heads as they watch the President tap dance away from any hint he might be friendly toward Lay or Enron.

"It's truly stupid," said Jim Hightower, former editor of the liberal Texas Observer and a 30-year commentator on Texas politics. "He's like a 4-year-old squeezing his eyes shut tight, pretending we can't see him."

"Here in Texas," Hightower added, "we're taught as kids you don't abandon your friends."

For years, in the society columns of the Houston Chronicle, the Lays qualified as Bush family friends in the many charity events they frequented.

In 1996, George and Laura Bush joined the Lays in spearheading a fund-raiser for the literacy project sponsored by George's mother, Barbara Bush.

In 1999, the Lays chipped in $100,000 for the Andersen Cancer Center at Texas A&M University — in a fund-raising drive chaired by then-Gov. Bush and his wife.

Lay, the President and the former President certainly acted like old friends when they watched the opening game of the Astros' 2000 season together at Enron Field.

As friends often do, Kenneth Lay sought favors. As Lay passed the hat in 1999 for Bush's presidential bid, Gov. Bush signed a Texas energy deregulation bill that opened huge new markets for Enron. Bush set up a panel that met in secret and granted exemptions to allow power plants to exceed legal pollution limits. Enron got plenty.

In 1997, Lay wrote to Bush, asking him to arm-twist the Texas congressional delegation to support more federal aid for businesses investing abroad. Enron sought loan guarantees and cheap federal insurance for projects in India and Bolivia.

Some Texans Irked

What galls some Texans is Bush's effort to deflect questions about his relationship to Lay.

Bush tried to dismiss the idea the man he called "Kenny boy" was his buddy by implying that Lay had backed former Texas Gov. Ann Richards during his 1994 bid to win the Austin governor's mansion.

Bush said he'd kept Lay in charge of his Governor's Business Council only to maintain continuity.

Lay lavished three times more campaign cash on Bush and worked hard to elect him.

"Wasn't that silly of George Bush?" Richards said last week on CNN's "Larry King Live." "What a stupid thing."

Richards recounted how Lay warned her before the race that he and and his wife "are very, very close to the Bush family."

Richards recalled Lay saying that while he might vote for her, his wife was "going to be in this race for George W. — money, marbles and chalk."