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White House: Bush Not Hypocritical on Past Business Activities - 2002-07-11

The White House is defending President Bush's past business activities during an onslaught of criticism from Congressional Democrats. They maintain Mr. Bush profited from the corporate practices he wants to curtail.

Before he entered politics, George W. Bush was a businessman, running a small energy company in Texas, serving on a corporate board of directors, and eventually buying part-ownership in a professional baseball team.

He campaigned for president on a pro-business platform, saying the government imposes too many restrictions on the corporate sector. Now, as the result of a series of high-profile business scandals, President Bush is calling for reform.

He is walking a fine line. During his own time in the business sector, Mr. Bush took some actions that are coming under question. One concerned the sale of corporate stock, which was ultimately looked into and cleared by government investigators. The other involved two loans.

In the 1980s while sitting on the board of directors of the Harken Energy company Mr. Bush received the low-interest loans to buy stock in the corporation. They totaled less than $200,000, and came at a crucial time in his business career.

They are the same kind of loans the president now wants to curtail. In his speech Tuesday in New York on corporate accountability, Mr. Bush called for corporations to stop the practice. "I challenge compensation committees to put an end to all company loans to corporate officers," Mr. Bush said.

White House officials said the president was not being hypocritical. Communications Director Dan Bartlett said Mr. Bush was talking about businessmen and women who abuse the system, citing the case of an executive with the troubled Worldcom corporation who got a loan totaling $400 million.

But Democrats are seizing the story of the Harken Energy loans as another sign that the Bush administration is more sympathetic to the needs of the business sector than it is to the concerns of corporate employees, stockholders, and consumers.

In the Senate, West Virginia's Robert Byrd recalled that Mr. Bush once vowed to run the White House like a corporation. Senator Byrd said the president is making good on that promise.

"He did not realize at the time that he would be faced with disclosure of a corporate culture, which encouraged shoddy auditing, negligent or criminal management, and impudent and secretive corporate CEO's. In hiding its own actions from the public view, this administration is fostering the same kind of arrogant, arrogant culture in which these corporate accounting scandals were allowed to flourish," Senator Byrd said.

Meanwhile, a private group is running advertisements on television in New York and Washington, taking aim at the administration's business connections. The ads are yet another sign that the president's response to the latest corporate scandals in America is rapidly becoming a big political issue in the campaign for the November congressional elections.