Congress finds Enron scandal “criminal”


Members of Congress pointed to possible criminality in the Enron Corp. scandal yesterday, saying the company manufactured income out of its off-the-books deals that led it to financial disaster.

On the eve of congressional testimony by former company chairman Kenneth Lay, a new review of Enron disclosed that in at least two cases, key documents could not be found that would show which top executives signed their names to the controversial deals that brought about the company”s downfall.

“We”re finding what may clearly end up being securities fraud,” said House Energy and Commerce Committee Chairman Billy Tauzin. “Fraudulent, phony attempts” to move debt out of the company “in violation of current accounting practices.”

Tauzin (R-La.) said that “we found instances where some employees were invited in on the deals for a small investment of $6,000 six weeks later that $6,000 investment became $1 million.”

Sen. Byron Dorgan said that in one failed deal, an Enron partnership named Braveheart borrowed $110 million from a Canadian bank and the company booked the money as income.

“They were doing almost no business, but they manufacture income from a bank loan,” said Dorgan, who appeared with Tauzin on NBC”s “Meet the Press.”

Budget cuts result in loss for health care


President Bush”s new budget will propose $591 billion in tax cuts over the next decade, even as he battles to turn federal deficits back into surpluses, documents obtained Saturday by The Associated Press show.

Though a new round of tax reductions is not a major White House priority this year, the numbers show those cuts would claim a large share of dwindling federal surpluses.

The documents show that Bush”s $2.13 trillion budget for next year, to be released today, will draw upon savings from Medicaid and a health-insurance program for low-income children. It also will propose raising money by leasing mineral drilling rights in Alaska”s Arctic National Wildlife Refuge, which Congress blocked last year.

While shedding little light on specifics, the documents confirm the crunch many programs face next year in Bush”s plan to contain a deficit he projects at $80 billion.

The figures show that spending for all programs except automatically paid benefits would grow from $688 billion this year to $746 billion next year, or 9 percent.

Arafat denounces Palestinian terrorist


Yasser Arafat and Ariel Sharon each took unusual steps yesterday: the Palestinian leader pledged to stamp out Palestinian “terrorist groups,” while the Israeli leader announced he would continue cease-fire talks he began last week with senior Palestinians.

Arafat, in an article in The New York Times, employed some of the strongest language he has ever used to denounce Palestinian militants who carry out bombings and shootings against Israeli civilians.

“These groups do not represent the Palestinian people or their legitimate aspirations for freedom,” Arafat wrote. “They are terrorist organizations, and I am determined to put an end to their activities.”

Sharon said he would hold more cease-fire talks when he returns from a meeting this week with President Bush.

Voters hoping for Gore in “04 elections


A handmade sign propped on an easel in the middle of the emptying ballroom after Al Gore spoke simply read “Gore 2004.”

The question was on the lips of nearly everyone who shook hands, hugged and posed for pictures with the man who narrowly lost the 2000 presidential election.

“Are you going to run again?” they asked, and “I hope you”re in the race, Al,” they said.

The response varied little: “Well, we”ll see. I haven”t decided yet.”

But Gore, who is still wearing his post-election beard, was certainly laying the groundwork with his “return to the national debate” speech Saturday night.

The 2001 presidential candidate and former vice president held a $25-a-person fund-raiser for the Tennessee Democratic Party.

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