Eve of the speech

I will have plenty to say on Bush's corporate responsibility speech tomorrow. However, this story on the eve of the speech has some real gems.

For starters, we finally, we have a skeptical White House corps.

"All I can tell you is that in the corporate world, sometimes things aren't exactly black and white when it comes to accounting procedures," Bush said in defending Harken. The company announced larger losses after the SEC determined that it had counted future income prematurely; Harken had sold a subsidiary, Aloha Petroleum, in 1989 through a seller-financed loan that it declared as a cash gain, masking huge losses.

Bush, who appeared irritated by the questioning, glared at reporters in the White House briefing room when he heard titters after that answer. "There was an honest difference of opinion as to how to account for a complicated transaction," he said. "And you're going to find that in different corporations. Sometimes the rules aren't as specific as -- as one would expect, and therefore the accountants and the auditors make a decision."

"Titters"? The press was laughing at Bush's lame excuses. In Bush's world, selling a company's subsidiary to itself, then claiming the sale price as profit, is not clearly wrong.

No wonder the press laughed in his face.

So now he is irritated. Rove and his cohorts better do some serious work with Bush. Because if he's irritated on day 1 of the scandal, what's going to happen after he hears the same questions week after week after week? The press smells blood. And the more he shows irritation, the more the press will, er, press (pun definitely not intended!).

What else? Bush also says some of the current corporate scandals may be "victims of honest disagreements". Just like his insider trading was just an honest disagreement, as was booking profits from a sham sale.

Yet, he then waxes poetic about restoring investor confidence:

I'm very worried about a country that has -- could conceivably lose confidence in the free enterprise system [...] I also understand how tender the free enterprise system can be. If people lose confidence in the system, it'd be hard to attract capital into markets, and that's one reason I've reacted so steadily against what I have seen.

The reason people are losing faith in the system is that CEO sharks, like Bush himself, don't see anything wrong with crooked transactions. They think those transactions are accounting disagreements, not the lies and deception they truly are. So he can blame Democrats, he can claim 'honest disagreements', and he can pretend that only a handful of CEOs are to blame. But that won't restore market confidence for one reason -- investors know it's all a lie.

One final thing. Will someone please explain to me how can a free enterprise system be 'tender'?

Posted July 08, 2002 10:44 PM | Comments (1)