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Plugging the Enron gap. An hour ago the guys on Squawk Box at CNBC were chatting with Kim Fennebresque, CEO of securities firm SG Cowen, and they were sharing their amazement at the depth of "participation" by the investment banks and financial community in the dark dealings of Enron.

"You can lose integrity incrementally," suggested Fennebresque somewhat apologetically, mentioning that he personally knew one of Enron's co-conspirators at Merrill Lynch who happened to be a "great guy."

Host Mark Haines brought up the fact that for every successful indictment, there are dozens of other deeply involved "participants" who are "still out there."

Which begs the question — what are those people doing since the demise of Enron?

Short answer: plugging the Enron gap. Contributing to Bush-Cheney 2004.

Enron is effectively gone, and now the Bushies need to address the gap that Enron left when its role as Bush's #1 campaign contributor went up in Wall Street smoke. When it comes to building the financial infrastructure for the energy-deregulating, environment-destroying, plutocrat-enriching, Bible-beating, oilfield-invading no-bid Bush administration, it should come as no surprise there are plenty of other Wall Street "participants" ready to pick up the slack (NYT):

After winning Congressional approval for cuts in taxes on dividends, capital gains and for certain business investments, and after navigating a raft of corporate accounting scandals that shook the investment community, President Bush seems to have won over many financial executives, who are now strongly supporting his re-election campaign.

A study to be released today shows that the financial community has surpassed all other groups, including lawyers and lobbyists, as the top industry among Mr. Bush's elite fund-raisers. The list of those generating $100,000 and $200,000 now includes chief executives like Henry M. Paulson of Goldman Sachs, John J. Mack of Credit Suisse First Boston and Stanley O'Neal of Merrill Lynch, whose firm has already raised twice the amount for Mr. Bush's re-election that it did during the entire 2000 campaign cycle.

[...]

The 2004 election is still more than a year away, but employees of securities and investment firms and their political action committees have contributed $3.8 million to the Bush campaign through September, just $159,000 less than they gave during the entire campaign cycle in 2000, according to the Center for Responsive Politics, which tracks campaign finance.

The president has raised more from the industry than all nine candidates in the Democratic field combined. While Senator John Kerry of Massachusetts counts the industry as his second-largest contributor, at about $1 million through September, others have not done as well. Howard Dean, the top fund-raiser in the field, raised about $302,000, and Senator Joseph I. Lieberman of Connecticut raised about $639,000.

"All these guys are totally in Bush's camp," said a politically active executive, adding that "people are not hedging their bets at this point. There's not a lot of fund-raising being done for Democrats right now."

Mr. O'Neal of Merrill Lynch sent a series of letters to the homes of a few hundred of the firm's most senior executives in June, asking them to contribute to a fund-raising dinner in support of Mr. Bush. James E. Cayne, chairman and chief executive of Bear Stearns & Company, also sent a letter asking his executives to donate to the campaign.

Joseph J. Grano, who runs the brokerage operations of UBS, the Swiss bank, has been an avid backer of President Bush and the Republican convention. Mr. Grano promised to raise at least $200,000 for the re-election campaign and to gather money for the convention, said executives at the firm, formerly known as UBS PaineWebber.

Mr. Paulson, of Goldman Sachs, was recruited by Gov. George E. Pataki of New York to collect cash from the Wall Street firms to finance the convention, an official at the firm said, and has gathered $5 million so far.

Merrill Lynch's involvement in the Enron catastrophe, which involved firm-level knowledge of fake Nigerian barge purchases by Enron (in direct contrast to Arthur Andersen's knowledge of Enron misbehavior limited to a handful of partners in Houston and Chicago, yet the Department of Justice indicted the entire firm instead of the responsible individuals), means it has been called upon to plug the enormous contribution gap left by Enron.

Merrill Lynch CEO Stanley O'Neal must understand that it is only by the grace of Ashcroft he is not out of a job. Merrill Lynch's continuing existence as the nation's largest wealth manager depends on the adminstration looking the other way and pretending there's nothing to see here. A befuddled public and a beholden press guarantee that the story will never have the momentum it deserves.

Banks, which only a decade ago used to spend equally on Democrats and Republicans, now favor Republicans more than two to one, according to the Center for Responsive Politics.

We should point out that all this record-breaking financing is well in advance of the Republican convention for an unopposed candidate. So these contributions are effectively bribes or, to put it more delicately, pre-emptive favors, and nothing compared to what's coming. When the Dem front-runner is finally established, we'll learn how deep those Wall Street pockets really are and how Willie Hortonized the American media will have become by this time next year in the wake of all that money.

People complain about America's two-party system, but it's rapidly becoming a one-party system. Your vote, if it counts at all, is a whisper in a stadium. Your bank's, your broker's, and your insurance company's votes are the stadium PA system at 110 decibels.

Enron's just a punch line now, but it still serves as the most telling symbol of everything wrong with the administration in its fraudulence, its secrecy and its servile delivery of any little thing that only the largest businesses want. The Bush administration will drive to the ends of the earth at any financial or human cost to provide more wealth and power to its masters. Everything else, including the safety and the will of the American people and the rest of the world, is roadkill.

More from the Times article above:

Texans for Public Justice, a group that tracks campaign money, examined Mr. Bush's fund-raising network and which industries it represents. Its study, to be released today, shows that 20 percent now come from the financial sector, up from 14 percent in the last presidential election. The industry — defined broadly to include banks, finance companies, securities and investment firms and accounting and tax service firms — has produced at least 38 new elite fund-raisers for the Bush campaign.

Executives who have signed on include Mr. Cayne of Bear Stearns; Stephen M. Lessing, managing director at Lehman Brothers Holdings; and Henry Kravis, founding partner at Kohlberg Kravis & Roberts.

{ 10:07 AM }

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