Skilling Says He Was Unaware Of Enron’s Financial ProblemsTHE WASHINGTON POST -- WASHINGTON
Enron Corp.’s former chief executive told a skeptical House subcommittee Thursday that he was unaware of financial problems at the company when he left four months before it collapsed, a position contradicted by two senior Enron executives who testified they repeatedly warned him about conflicts of interest that enriched some insiders.
“I did not believe the company was in any financial peril,” said Jeffrey Skilling, who testified under oath after Andrew Fastow, the company’s onetime chief financial officer, and three other senior executives cited their Fifth Amendment protection against self-incrimination in refusing to answer questions.
Skilling, who resigned unexpectedly last Aug. 14, said he was unaware that Fastow and other Enron officials collected more than $40 million from off-the-books partnerships whose failure last fall led to the company’s collapse.
Jeffrey McMahon, a former Enron treasurer, and Jordan Mintz, a senior attorney, testified that they had tried to tell Skilling their concerns that the partnerships benefited Fastow and others, not Enron.
Skilling firmly denied knowing about any wrongdoing or efforts to conceal Enron’s losses from investors.
“I was not aware of any financing arrangements designed to conceal liabilities or inflate profitability,” he said in his opening statement to the House panel. “The financial statements issued by Enron, as far as I knew, accurately reflected the financial condition of the company.” But Skilling frequently responded, under questioning, that he could not recall being present at crucial meetings or events that lawmakers said foreshadowed Enron’s demise.
Byrd Berates O’Neill Over BudgetTHE WASHINGTON POST
Tensions between Congress and the White House over the president’s budget exploded Thursday when a debate over congressional prerogatives turned into an unusually bitter and personal exchange involving two of Washington’s most powerful figures: Sen. Robert Byrd, D-W.Va., and Treasury Secretary Paul O’Neill.
The spat rocked an otherwise routine Senate Budget Committee hearing, where the normal dance of senatorial courtesy -- and polite groveling by administration witnesses -- suddenly vanished. O’Neill, telling Byrd he wouldn’t “cede to you the high moral ground of not knowing what life is like in a ditch,” seemed to struggle with his emotions by often taking deep breaths.
Byrd, 84, chairs the powerful Appropriations Committee and is arguably the fiercest defender of Congress’s interests. He spent 15 minutes berating O’Neill, a straight-talking former corporate executive, for a speech the secretary made last year asserting that congressional rules “created by just ordinary people” are “like the Lilliputians tying us to the ground.”
Byrd noted that the administration’s glossy new budget document includes a cartoon of Gulliver tied down by Lilliputians. He denounced the cartoon -- one of several illustrations of White House sentiments and criticisms -- as “nonsense” that belittled how Congress represents the interests of Americans.
Since Monday’s release of the president’s budget plan, which vividly poked fun at alleged congressional pork, lawmakers from both parties have bristled at the administration’s rhetoric. The chairman of the House Appropriations Committee, Rep. Bill Young, R-Fla., sent a tart letter Wednesday to the White House budget director, saying that “all wisdom on the allocation of grant funding does not reside in the Executive branch.”
“A lot of us were here before you came,” Byrd sternly told O’Neill at Thursday’s hearing. He noted that he’d seen many secretaries of the Treasury during his half century in Congress, and that no one elected O’Neill. “With all respect to you, you are not Alexander Hamilton,” Byrd said.