From: rbw@mrwassoc.com
To: susan.mara@enron.com, jeff.dasovich@enron.com, mona.petrochko@enron.com
Date: 2000-09-14 18:28:00+00:00
Subject: Fwd: [Tech] Enron {01}

FYI

Bob


>Date: Thu, 14 Sep 2000 11:05:55 -0700
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>Subject: [Tech] Enron {01}
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>Bay Guardian article featuring ENRON , 9/6/2000
>
>Slick oil: George W. Bush's toxic money pipeline.
>
>                             By Pratap Chatterjee
>
>                             EARLY LAST OCTOBER, every member of a ninth
>grade girls
>                             track team and the freshman the football
>team at suburban
>                             Houston's Deer Park High School's north
>campus returned from
>                             practice reporting severe breathing
>problems. That day Deer Park
>                             registered 251 parts of ozone per billion,
>more than twice the
>                             federal standard, and Houston surpassed Los
>Angeles as the
>                             smoggiest city in the United States.
>
>                             One of the biggest sources of Deer Park's
>pollution is a plant
>                             owned by Enron, Houston's wealthiest company
>d and the single
>                             largest contributor ($555,000 and counting)
>to the political
>                             ambitions of Texas Governor and Republican
>presidential
>                             nominee George W. Bush. Kenneth Lay, the
>chief executive of
>                             Enron, has personally given over $100,000 to
>Bush's political
>                             campaigns, more than any other individual.
>He is one of Bush's
>                             "Pioneers" d elite fund-raisers who have
>collected at least
>                             $100,000 in direct contributions of $1,000
>or less for "Dubya."
>
>                             Enron is best known as the largest buyer and
>seller of natural gas
>                             in the country. Its 1999 revenues of $40
>billion make it the 18th
>                             largest company in the United States. Enron
>is invested in energy
>                             projects around the world including the UK,
>Argentina, Bolivia,
>                             Brazil, the Philippines, Indonesia, China,
>India and Mozambique.
>
>                             The company has recently expanded from
>energy to "bandwidth"
>                             capacity for the Internet, making it one of
>the world's largest
>                             Internet-based trading companies, buying and
>selling a dizzying
>                             array of products ranging from pulp and
>paper to petrochemicals
>                             and plastics, as well as esoteric products
>like clean air credits that
>                             utilities purchase to meet emission limits.
>
>                             Texas activists say that this tight
>connection between Bush and
>                             Lay bodes ill for the country, if Bush is
>elected. Andrew Wheat,
>                             from Texans for Public Justice, a campaign
>finance advocacy
>                             group in Austin, compared the symbiotic
>relationship between
>                             Enron and the Governor to "cogeneration"-a
>process used by
>                             utilities to harness waste heat vented by
>their generators to
>                             produce more power. "In a more sinister form
>of cogeneration,
>                             corporations are converting economic into
>political power," Wheat
>                             explained. "A Bush election fueled by Enron
>dollars could fill the
>                             White House with dangerous levels of Enron
>gas. When that gas
>                             ignites in the public-policy arena,
>consumers will get burned." .
>
>                             Indeed Bush campaign spokesman Ray Sullivan
>said that, if
>                             elected president, the governor is keen to
>promote the kind of
>                             policies that he has crafted with companies
>like Enron for the state
>                             of Texas. "The governor believes in
>competition, free enterprise,
>                             better service and technology improvements.
>He has promoted
>                             sweeping and effective reforms in education
>and has been the first
>                             governor in Texas to seriously address
>limits on emissions. He will
>                             carry his agenda to Washington to do what he
>believes is best for
>                             the country."
>
>                             But is what Bush believes is good for Texas,
>good for the United
>                             States Of America? Texas has one of the
>worst environmental
>                             records in the country, particularly in air
>pollution. Unfortunately, the
>                             Bush platform for the country is very
>similar to the kinds of
>                             programs that he has worked on with Enron d
>cutting corporate
>                             taxes, deregulating industry and replacing
>social programs with
>                             private sector volunteerism.
>
>                             In addition Enron is invested in energy
>projects around the
>                             globe-some of which have been tainted by
>charges of human
>                             rights abuses. In India construction of
>Enron's controversial Dhabol
>                             power plant has brought charges by
>international groups like
>                             Human Rights Watch and Amnesty International
>of complicity with
>                             police brutality in rural communities. And
>according to
>                             California-based Amazon watch, Enron is
>charged with human
>                             rights violations in Bolivia, where it is
>building a major gas pipeline
>                             threatening indigenous communities and the
>rainforest
>                             environment.
>
>                             Special deals
>
>                             The Enron Methanol plant in Pasadena, Texas
>lies in the Houston
>                             Ship Channel area, the nation's largest
>concentration of
>                             petrochemical plants just east of the city.
>The Enron Methanol plant
>                             has won special concessions from Governor
>Bush allowing the
>                             company to pollute without a permit, as well
>as giving the company
>                             immunity from prosecution for violating the
>law. Indeed, plants like
>                             this in Texas actually emit twice as many
>nitrogen oxides, a key
>                             ingredient of smog, as do all the nine
>million cars in Texas put
>                             together.
>
>                             Only seven percent of the more than 3,500
>tons of nitrogen oxide
>                             emitted by the Enron Methanol plant in 1997
>were permitted.
>                             Enron got away with this under the
>"grandfather clause" of the
>                             1971 Texas Clean Air Act which allows plants
>built before 1971 to
>                             continue their polluting practices. Governor
>Bush extended this
>                             clause under the 1999 Clean Air
>Responsibility Enterprise
>                             (CARE) program that his office drew up in a
>series of secret
>                             meetings with representatives of the top
>polluters in the state.
>                             CARE waives permit requirements for plants
>that volunteer to cut
>                             emissions.
>
>                             The CARE program is backed up by an act that
>Bush signed in
>                             May 1995 giving sweeping protections to
>polluters who perform
>                             internal environmental or safety audits. The
>law makes these audit
>                             documents confidential from the public and
>allows polluters to
>                             escape responsibility for environmental
>violations. To date Enron
>                             has conducted five such audits and filed for
>immunity from
>                             prosecution for violations of the law,
>according to the Texas
>                             Natural Resources Conservation Commission
>(TNRCC), the state
>                             equivalent of the Environmental Protection
>Agency.
>
>                             Tamara Maschini, who lives about five miles
>from the Enron plant
>                             is one of the founders of a local
>environmental group called Clean
>                             Air Clear Lake. "Whole families in this
>neighborhood have asthma
>                             because of the pollution from plants like
>Enron," she says. "It's
>                             gotten so bad that NASA has a problem
>recruiting people to work
>                             here at Mission Control which is just down
>the road. Houston is in
>                             trouble and George Bush is the reason d he
>has allowed the
>                             situation to deteriorate over the past
>several years," according to
>                             Maschini.
>
>                             Mark Palmer, head of public relations for
>Enron, says that the
>                             company's contribution to local pollution is
>minimal. "If the
>                             grandfather clause was canceled right now,
>we would benefit the
>                             most of any of the companies in Texas
>because our nitrogen oxide
>                             emissions add up to less than half a percent
>of the total," he said.
>
>                             Neil Carman, a former employee of the Texas
>Air Control Board,
>                             who now works for the Sierra Club, agrees
>that Enron's
>                             grandfathered nitrogen emissions add up to
>less than one percent
>                             of the total for all of Texas. However, he
>points out that Enron
>                             Methanol plant alone contributes 3.6% of the
>nitrogen oxide
>                             emissions from the nearly 250 stationary
>sources of pollution for
>                             the city of Houston d the equivalent of
>152,500 cars.
>
>                             What's more, he says that Enron is simply
>paying lip service to the
>                             Bush proposal to cut pollution at grand
>fathered plants. "Enron
>                             showed up at the governor's press conference
>to volunteer for the
>                             CARE program but they have been missing in
>action ever since.
>                             They haven't even bothered to file their
>voluntary plan."
>
>                             Giving and receiving
>
>                             If environmental regulators wanted to speak
>to Enron's senior
>                             officials about the missing voluntary
>program, they would be well
>                             advised to follow the presidential candidate
>around as he is often
>                             chaperoned by Enron officials.
>
>                             On April 7, 2000, Ken Lay, Enron's chief
>executive, played host to
>                             Bush junior and his father, former president
>George Bush, at the
>                             Houston Astros' first home game of the
>season at the baseball
>                             team's brand new stadium d Enron Field d
>which was built with the
>                             help of a $100 million donation from Enron.
>(The company got free
>                             advertising, a tax break and a $200 million
>dollar contract to
>                             supply power to the stadium in return.) Less
>than three weeks later
>                             Lay joined Bush in Washington DC for a
>Republican fund-raiser
>                             that topped all previous records by bringing
>in a staggering $21.3
>                             million, easily the biggest one-night haul
>for any political party in
>                             history.
>
>                             That's not all. Lay makes sure that the Bush
>presidential campaign
>                             has access to other Enron facilities. Last
>year the Bush campaign
>                             borrowed Enron's corporate jets eight times
>to fly aides around the
>                             country, more times than any of the 34 other
>companies that made
>                             their company aircraft available to the
>presidential hopeful. (Under
>                             federal law, campaigns must reimburse
>companies for
>                             transportation, typically at the cost of a
>first-class ticket so Enron
>                             received $25,000 from the Bush campaign for
>this favor).
>
>                             Lay's ties to Bush junior begin with his
>father, former President
>                             George Bush, who was also a recipient of
>Enron/Lay's financial
>                             largesse. Like his son now, Bush senior was
>also happy to return
>                             the favor, appointing Lay to the President's
>Export Council from
>                             1991 to 1993.
>
>                             When asked about the relationship between
>the two men, Ray
>                             Sullivan, a spokesman for the Bush campaign,
>chose his words
>                             carefully. "Ken Lay is a noted business
>leader in Texas who has
>                             long been active in Republican politics. He
>is chair of the
>                             Governor's Business Council. But the
>governor has his own
>                             agenda based on what he believes is best for
>Texas and for the
>                             country."
>
>                             Lay toed a similar line when recently
>interviewed by the New York
>                             Times. "When I make contributions to a
>candidate, it is not for
>                             some special favor, it's not even for access
>d although I'll be the
>                             first to admit it probably helps access. It
>is because I'm supporting
>                             candidates I strongly believe in
>personally." Indeed both Lay and
>                             Enron are generous contributors to local and
>national politicians
>                             wherever they do business, often following
>the long standing
>                             corporate practice of funding candidates on
>both sides of the
>                             election.
>
>                             According to campaign records, Enron and Lay
>have contributed
>                             to Democrats as diverse as Texas Land
>Commissioner Garry
>                             Mauro, U.S. Rep. Richard Gephardt of
>Missouri and Texas House
>                             Speaker Gib Lewis. In 1984, Lay was Harris
>County chairman of a
>                             $1,000-a-plate Reagan-Bush fund-raiser,
>while at the same time
>                             co-chairing a fund-raiser for U.S. Sen.
>Lloyd Bentsen, the vice
>                             presidential candidate on the opposing
>ticket.
>
>                             Bush delivers just the kind of results that
>Lay wants. Candidate
>                             Bush says he will "work with local
>jurisdictions using market-based
>                             solutions and not try to sue our way or
>regulate our way to clean air
>                             and water." He proposes allowing industries
>to voluntarily police
>                             themselves, just like he did for Enron and
>the other polluters in
>                             Texas.
>
>                             Texas has regularly ranked as the most
>environmentally polluted
>                             states in this country for years. According
>to the Environmental
>                             Defense Fund, Texas has the worst record of
>all 50 states in air
>                             pollution, water pollution, overall toxic
>releases, recognized
>                             carcinogens in the air, suspected
>carcinogens in the air,
>                             developmental toxins in the air (affecting
>brain and
>                             nervous-system development in children) and
>cancer risk.
>
>                             While it is true that Texas was the most
>polluted state in the
>                             country before George W. Bush became
>governor, the reason it
>                             has stayed that way is simple: Bush's
>policies have effectively
>                             allowed these industries to continue to
>pollute through a system of
>                             voluntary compliance.
>
>                             Read the fine print
>
>                             Ken Lay and Enron's political beliefs
>overlap with candidate Bush
>                             in other arenas such as education. For
>example on August 20,
>                             2000 the Houston Astros will host a book
>drive at Enron Field to
>                             promote one of George W Bush and Enron's
>favorite charities d
>                             the Reach Out And Read (ROAR) literacy
>program.
>
>                             Launched in 1998, by Laura Welch Bush, the
>governor's wife, the
>                             program calls for physicians and nurse
>practitioners to give free
>                             culturally appropriate books to their
>pre-school age patients at
>                             every checkup. Enron also regularly
>volunteers its employees to
>                             read to children in area clinics and
>conducts book drives. The cost
>                             to Enron for this five year publicity
>program was $400,000.
>
>                             Susan Cooley, the director of Texas ROAR,
>was gushing in her
>                             support for the company, the governor and
>his wife. "I've been a
>                             nurse for 25 years. I don't know anything
>about sponsorship or
>                             advertising. But at Enron they have whole
>departments to do this,
>                             so finding a corporate sponsor has been a
>godsend," she said.
>
>                             However Enron is less than supportive of
>schools that do not
>                             provide similar public relations
>opportunities. And its political
>                             reach goes beyond the governor's mansion.
>Some 20 miles north
>                             of the company's headquarters in Houston
>Enron has effectively
>                             cut approximately $225,000 from the annual
>budget of the Spring
>                             school district, one of Houston's ethnically
>diverse, poorer
>                             suburbs. Spring, Texas, sits on top of
>Bammel Field, a huge
>                             underground salt cave, which Enron uses to
>store large quantities
>                             of natural gas. As the largest business in
>Spring, Enron was
>                             required to pay taxes based on the value of
>its property and
>                             mineral holdings on January 1st of each
>year.
>
>                             But under a special 1989 provision Enron and
>other large
>                             business property owners were allowed to
>choose September 1st
>                             as their tax assessment date, when the
>company has less gas
>                             stored in Bammel field. Enron was able to
>reduce its property
>                             taxes by $15 million in 1990, blowing a hole
>in the school districts
>                             budget, according to Katherine Trumbull, a
>tax accountant with the
>                             school district .
>
>                             The Spring school district went to court to
>challenge the new tax
>                             provision as unconstitutional and won at the
>appeals court level.
>                             Enron appealed this decision to the Texas
>Supreme Court. While
>                             the case was pending Enron's Political
>Action Committee (PAC)
>                             and senior executives contributed heavily to
>the election
>                             campaigns of every Republican judges vying
>for seats (all the
>                             members of the Texas Supreme Court are
>elected and may take
>                             money from contributors for the campaign
>expenses). Enron's
>                             employees and PAC doled out $78,700 between
>the seven of the
>                             winning justices in the 1996 campaign
>including more than
>                             $24,000 from Ken Lay personally. The Supreme
>Court justices
>                             ruled unanimously in Enron's favor on May 6,
>1996, a month after
>                             Lay gave Chief Justice Thomas Phillips
>$5,000 for his campaign.
>
>                             "I have nothing against Enron, after all
>they are our biggest
>                             taxpayer. They can afford to pay for good
>lawyers and lobbyists
>                             and we can't," says Trumbull simply. Enron's
>Palmer had no
>                             comment about the tax lawsuit brought by the
>Spring Independent
>                             School District.
>
>                             Enron's global muscle
>
>                             Enron has also courted Bush's help for its
>business abroad. In
>                             March 1997 Lay wrote a letter to Bush, that
>was subsequently
>                             released to the press under Texas open
>records laws, asking him
>                             to contact every member of the Texas
>delegation to explain how
>                             "export credit agencies of the United States
>are critical to U.S.
>                             developers like Enron, who are pursuing
>international projects in
>                             developing countries."
>
>                             These agencies include the Overseas Private
>Investment
>                             Corporation (OPIC), a federal agency which
>provides political risk
>                             coverage and financial support to United
>States companies
>                             investing abroad d including hundreds of
>millions of dollars for
>                             Enron projects in countries from Brazil to
>India. Unfortunately for
>                             communities in these countries Enron's
>investments have had
>                             devastating impact.
>
>                             In India where Enron received $200 million
>in political risk
>                             insurance for the Dabhol offshore oil and
>gas development project
>                             in 1996, the company has been blamed by both
>Human Rights
>                             Watch as well as Amnesty International, for
>financing local police
>                             brutality.
>
>                             Just before dawn on June 3, 1997, police
>stormed the home of
>                             several women in Veldur, a fishing village
>in western state of
>                             Maharashtra, India. "The policemen forcibly
>opened the door and
>                             dragged me out of the house into the police
>van parked on the
>                             road. (While dragging me) the police kept
>beating me on my back
>                             with batons," says Sugandha Vasudev
>Bhalekar, a 24 year old
>                             housewife who was three months pregnant at
>the time of her
>                             arrest, according to Amnesty International.
>"The humiliation meted
>                             out to the other members of my family was
>similar to the way I was
>                             humiliated... my one and a half year old
>daughter held on to me but
>                             the police kicked her away."
>
>                             The only "crime" committed by these women
>was to lead a
>                             peaceful protest against a massive new Enron
>natural gas plant.
>                             An investigative team from Amnesty
>International found that a
>                             number of the women subsequently sustained
>injuries, including
>                             bruising, abrasions and lacerations on arms
>and legs. Several
>                             hundred other peaceful protestors have been
>arrested and
>                             temporarily detained by Indian police since
>December 1996,
>                             according to the report. Meanwhile, a
>January 1999 investigation
>                             by Human Rights Watch revealed that the
>police were directly on
>                             the Enron payroll.
>
>                             Likewise, Enron has been severely criticized
>for the Cuiab?
>                             Integrated Energy Project in Bolivia and
>Brazil, for which it
>                             received US$200 million in insurance from
>OPIC in 1999.
>
>                             On February 4, 2000 an oil pipeline operated
>by Transredes, a
>                             joint venture between Enron and Shell in the
>Cuiab? Integrated
>                             Energy Project, erupted in the Bolivian
>altiplano and dumped an
>                             estimated 10,000 barrels of refined crude
>oil and gasoline into the
>                             Desaguadero River, which supports indigenous
>communities like
>                             the Uru Moratos. Facing starvation from the
>loss of their life-
>                             sustaining waterfowl and fish, the Uru
>Moratos left their ancestral
>                             lands at the southern shores of Lake Poopo
>in April and marched
>                             85 miles to the city of Oruro to ask for
>government help. TK result...
>
>                             'Mutual self-interest'
>
>                             In January 1999 Enron pitched in $50,000 to
>help pay for Bush's
>                             inaugural bash in Austin, Texas, when he won
>the reelection for
>                             governor. If George W. wins this November,
>it is very likely Ken
>                             Lay will be on hand when Bush is inaugurated
>as the next
>                             president of the United States, hoping that
>in return for Lay's
>                             generous campaign Support, Bush will be
>equally generous in his
>                             support for Enron's businesses at home and
>abroad in the future.
>
>                             Craig McDonald, director of Texans for
>Public Justice, says that
>                             the relationship is bound to pay off. "Those
>two have a mutual
>                             self-interest in being buddies. Bush has
>always delivered on Ken
>                             Lay's political pitches. Enron depends upon
>government policies
>                             to enhance their bottom line in lots of
>ways. The company relies
>                             upon this kind of access to government," he
>recently told an
>                             Associated Press reporter.
>
>                             It is people from the Uru Moratas of Bolivia
>to the school children
>                             of Deer Park and Spring, Texas, who will
>ultimately pay the price
>                             through the continued destruction of their
>communities and
>                             environment.
>
>                             This story was made possible by the
>Corporate Watch Fund
>                             for Investigative Journalism.
>
>--
>Holly A. Senn
>Senior Information Specialist
>MRW & Associates
>1999 Harrison St., Ste. 1440
>Oakland, CA 94612
>p: 510.834.1999
>f: 510.834.0918
>e: has@mrwassoc.com