October 10, 2004
DeLay's Ethics Troubles Refocus House Races
By CARL HULSE, NY TIMES

WASHINGTON, Oct. 9 - Congressional races, which have been overshadowed by one of the most heated presidential campaigns in years, have been energized in recent days by the back-to-back ethics scoldings delivered to the House majority leader, Tom DeLay.

Immediately after the House ethics committee's actions against Mr. DeLay, Democrats set about trying to exploit the issue - sending an e-mail appeal for contributions based on Mr. DeLay's troubles, pointing out his ties to moderate Republicans they hope to defeat in November and renewing calls for Republican candidates to return contributions from the Mr. DeLay's political action committee.

House Republicans said the action against their embattled leader has served only to reinvigorate their support for him.

Just last week, the ethics committee - composed of five Republicans and five Democrats - issued a formal rebuke to Mr. DeLay for pressuring a fellow lawmaker to change his vote on an important health care bill. On Wednesday, the panel issued a second round of admonishments, citing Mr. DeLay for engaging in fund-raising activities that created the appearance of impropriety and for using his position to exert influence over a federal agency for political gain.

The impact, if any, that the ethics committee findings may have on Congressional races is unclear. Democrats need to gain 12 seats to win back the majority. Analysts have said consistently this year that that was unlikely, but the Democrats believe Mr. Delay's troubles could give them an effective new weapon. Only about three dozen of the 435 House seats are truly in play.

As the House approached a pre-election recess late Friday, the House Democratic leader, Representative Nancy Pelosi of California, forced a vote on bringing in an outside counsel to investigate Mr. DeLay, a proposal she knew would be defeated but one that put all House Republicans on record against a further inquiry.

Then on Saturday morning, Representative Steny H. Hoyer of Maryland, the Democratic whip, noted in the national Democratic radio response that Mr. DeLay has now been "rebuked" by the panel four times in five years. Democrats, he said, "will not elect leaders who spend more time fending off ethics charges than they do tending the people's business."

While Democrats say they have seen evidence of Mr. DeLay lowering his political profile, Republican leaders say they do not believe that Mr. DeLay will be a detriment in the upcoming elections and that he continues to be sought after for campaign appearances.

"I haven't heard of anyone that doesn't want him," said Representative Eric Cantor of Virginia, a member of the Republican leadership.

The Democratic maneuvers and the fusillade of calls for Mr. DeLay to step down have enraged his House allies, who say they view the ethics findings as the tainted result of a politically inspired push to stifle Mr. DeLay by those who have been unable to defeat him otherwise. Instead of limiting his political effectiveness, they say, the ethics cases and partisan recriminations are sparking a backlash and building party support.

"This was quite obviously an attempt to chill fund-raising and take the House out of Republican hands and it has really ticked off a lot of Republican members," said Representative Mike Rogers of Michigan, finance chairman for the House Republican campaign organization. He said lawmakers had approached him in recent days pledging to increase donations to the party effort in anger over the Democratic assault.

Even the most ardent Republican defenders of Mr. DeLay will acknowledge privately that the ethics admonishments are an unwelcome distraction as the election looms. But they say he has been cleared of the most serious accusations and that while the rulings could complicate his future, his leadership position is safe for now.

Democrats say Republicans are engaged in wishful thinking if they believe there will be no serious repercussions from the ethics findings, the first on Sept. 30 for his attempt to trade a political endorsement for a vote on the House floor for a teetering Medicare bill. Then on Wednesday, the panel chided him again for a fund-raiser that appeared to grant undue access and for using federal resources in a partisan conflict.

"There is no question that he is a liability to Republican House members," said Representative Robert T. Matsui of California, the chairman of the Democratic Congressional Campaign Committee. He and others said the slaps from the bipartisan panel gave substance to the Democratic assertion that Mr. DeLay pushes the limits in accumulating and wielding his power.

"It is certainly not going to help the Republicans maintain that they are a House of which people can be proud," said Mr. Hoyer, the No. 2 Democrat in the House.

If Democrats hope to convert Mr. DeLay's woes into Congressional victories around the nation, they have hurdles to overcome, not the least of which is that Mr. DeLay is not a well-known figure on a par with the former speaker Newt Gingrich, another Republican leader Democrats sought to convert into a political issue.

State leaders of both parties say they do not get a sense that Mr. DeLay has a profile that can move voters.

"Congressional leaders like Tom DeLay, most voters in Kansas don't even know who he is," said Scott Poor, executive director of the Kansas Republican Party. "He's not that big a deal here. In the minds of most voters, it's a real stretch to link their wonderful congressman to Tom DeLay."

Don Morabito, executive director of the Democratic Party in Pennsylvania, where a number of closely contested House races are under way, shared a similar view. "I'm old school, someone who believes all politics are local," he said. "Our close races are more about local issues, like sprawl, the economy and quality of life. The Kerry-Bush race does have an impact, but I haven't seen anything yet about DeLay, and I don't know if it will get any traction."

Democrats say they are not certain if they will broadcast television commercials that focus on Mr. DeLay, but they certainly intend to keep the heat on him and Republican candidates they can link to the majority leader. For instance, even the prospect of a visit by Mr. DeLay to the Seattle suburbs to raise money for King County Sheriff Dave Reichert, a Republican House candidate, sent Democrats into action.

"Who does Dave Reichert want to represent - Tom DeLay's conservative, win-at-all-costs wing of the Republican Party or the independent voters of the Eighth' Congressional District, asked Paul Berendt, chairman of the state Democratic Party.

But a spokesman for Mr. Reichert said the Republican welcomed the chance to meet with Mr. DeLay. "The sheriff will jump at every opportunity to discuss issues of importance to the Eighth District with the second-ranking member of the House of Representatives," said the spokesman, Josh Mathis.

Aides to Mr. DeLay said he would keep a full schedule of political activities in the days leading up to the election, though he would also be campaigning in his own suburban Houston district that was redrawn in the political battle that helped launch a grand jury investigation in Texas that has resulted in indictments of top DeLay political aides.

Representative Thomas M. Reynolds of New York, the chairman of the National Republican Congressional Committee, said he believed Mr. DeLay could continue to be a campaign force for the party. But he noted that the organization has relied more heavily in the 2004 House campaigns on appearances by Speaker J. Dennis Hastert of Illinois and Vice President Dick Cheney rather than the majority leader.

Allies of Mr. DeLay also say they do not see any impact for the fund-raising juggernaut on which the lawmaker has built his political foundation, doling out dollars to Republican candidates who repay him with loyalty. His political action committee raised about $3.3 million through August, but spent much of it, ending last month with about $538,000. Befitting his position, Mr. DeLay has led the Congress in contributions to fellow candidates, according to the Center for Responsive Politics.

Susan Hirschmann, who was Mr. DeLay's chief of staff for years before leaving in 2002 to work as a lobbyist and political adviser, said her former boss still enjoyed the support of his Republican colleagues and that the flow of money was not likely to slow or stop.

"Everyone sees this for what it is: election-eve politics," she said. "It's just not going to make a difference."

Some of the Republican anger over Mr. DeLay's treatment has also been directed at the ethics panel, which some critics say crumpled under pressure from outside groups and chastised Mr. DeLay for activities that were not outside the realm of normal politics. Republican members of the panel bristle at the suggestion and say they were trying to rein in Mr. DeLay as well as set limits of behavior for others.

"The consensus feeling was that he had been a couple of steps across the line and we ought to point that out," said Representative Joel Hefley, Republican of Colorado and chairman of the ethics panel.

DeLay Cases Could Imperil His Climb Within the House
By CARL HULSE and SHERYL GAY STOLBERGNY TIMES, October 2, 2004

WASHINGTON, Oct. 1 - Representative Tom DeLay, the majority leader rebuked by House ethics officials for pressuring a fellow member to switch his vote on a health care bill, still faces potentially more serious accusations, subjecting him to a new scrutiny that even some Republicans say could complicate his political future.

Mr. DeLay, the take-no-prisoners Texan known for maintaining strict discipline in his caucus, is entangled in a series of inquiries here and in Texas regarding his fund-raising and other activities. In Texas, three of his top aides have been indicted; in Washington, the House ethics panel is deciding whether to initiate a formal investigation.

On Friday, Republicans publicly rallied around their leader, though some said privately that the surprise ethics rebuke on Thursday - the second for Mr. DeLay, who was previously chastised for pressuring interest groups to hire Republicans - could hinder the leader if he tried to become speaker.

Democrats, who are already making Mr. DeLay an issue in their campaigns, attacked him on Friday for what Representative Nancy Pelosi of California, the Democratic leader, called a "continued abuse of power.' She said there was "an ethical cloud over this Capitol because of how he is conducting business here.'

The fracas is evoking memories of past ethics battles that have roiled Capitol Hill, and contributed to the ouster of two previous House speakers, Jim Wright, a Democrat, and Newt Gingrich, a Republican. Both ultimately faced calls from their own party members to step down, which is not the case with Mr. DeLay.

"If there is any pattern, it is that whenever anybody gets in power and becomes an effective leader in Washington, the other side, rather than beating them with ideas and philosophy, does a flank movement on ethics charges,' said Representative Jack Kingston of Georgia, the vice chairman of the House Republican Conference.

Mr. Kingston predicted that by Monday the ethics rebuke would be a "nonstory.'

But more than one Republican, speaking on condition of anonymity for fear they would anger their party's powerbroker, said Mr. DeLay's ethics history might make it difficult for him to become speaker someday.

"There are a lot of folks who want to see that happen, and they're a little depressed right now," one said.

A spokesman for Mr. DeLay, Stuart Roy, dismissed the Democratic criticism as politically motivated, and said the leader was not worried about the speaker's job. "He has said in the past that the only job he ever wanted was whip,' Mr. Roy said, "and he has let everything else take care of itself.'

The rebuke, issued Thursday night, stems from last year's vote on the Medicare prescription drug bill. The committee found that as the bill appeared headed to defeat, Mr. DeLay offered to endorse the son of a Michigan congressman, Representative Nick Smith, in a Congressional primary in return for Mr. Smith's vote in favor of the measure. Mr. Smith, a Republican who considered the bill too expensive, refused; he was admonished for what the panel said was exaggerating the pressure and inducements made to him.

The bill passed; Mr. Smith's son lost the primary.

For the ethics panel, which is composed of five members of each party, investigating the House majority leader is a task so delicate that the panel made public its 62-page report practically under cover of darkness, dropping it off in the House press gallery without comment.

In fact, the House had been awaiting the ethics panel's decision on a separate complaint, filed by Representative Chris Bell, Democrat of Texas, that accuses Mr. DeLay of illegally soliciting campaign contributions, laundering campaign contributions to influence state legislative races and improperly using his office to influence federal agencies. An announcement could come as early as next week.

The admonishment was particularly surprising since Mr. DeLay had not figured prominently in the controversy surrounding Mr. Smith. "It is like a second hurricane," one Republican official said.

Some wondered if a trade was afoot - a public slap in the Smith case in exchange for a decision not to pursue Mr. Bell's complaint. Others said the ethics panel now had no choice but to look into those accusations.

"Mr. DeLay has a track record now in the ethics area, and it's a bad one," said Fred Wertheimer, president of Democracy 21, a watchdog group that has called for the ethics panel to hire an independent counsel to investigate Mr. DeLay. "There's just no basis on which the House ethics committee can do anything now but seriously move forward with an investigation into the ethics complaint pending before it."

Democrats are encouraging their candidates to invoke Mr. DeLay's name in campaigns. Since the indictments, the Democratic Congressional Campaign Committee has demanded that Republican candidates return donations from Mr. DeLay.

"He hasn't reached the stage of Newt Gingrich, but he has reached the center of gravity, where people do see him as representing the Republican Party in the House of Representatives, and as somebody who abused the rules of the House," said the committee's chairman, Representative Robert T. Matsui of California, in an interview on Friday.

This is not an new issue for Mr. DeLay:

July 12, 2002, Friday
BUSINESS/FINANCIAL DESK
CORPORATE CONDUCT: POLITICS; Parties Trade Lobs Over Issue of Lax Oversight

By DANIEL ALTMAN (NYT) 648 words
WASHINGTON, July 11 -- While senators debated an accounting reform bill today in advance of an expected vote on Monday, Democrats and Republicans eagerly tried to blame each other for years of supposedly lax oversight of corporate behavior.
Richard A. Gephardt, the House minority leader, accused Republicans today of setting the stage for corporate wrongdoing through a gradual drive for deregulation, starting with the Contract With America in 1995. 'We see daily evidence of what happens when the drive to deregulate succeeds,' he said, 'as it did over the last seven or eight years.'

Mr. Gephardt distributed a 26-page pamphlet to support his point, with photographs of Tom DeLay, the House majority whip, and Newt Gingrich, the former speaker of the House, on the cover, along with the logos of Enron, WorldCom and other embattled companies.

The pamphlet describes Republican-led campaigns to deregulate the derivatives markets in which Enron traded, to cut financing for the Securities and Exchange Commission and to limit a handful of environmental and consumer protections.

In a response sent via e-mail, the Republican National Committee pointed out that some Democrats had supported the bills that Mr. Gephardt's pamphlet called 'overzealous efforts to roll back public protections.'

In every case, however, a majority of Democrats had voted against the bills.

Senior Republican aides in the Senate countered with their own pamphlet, which tries to pin lax oversight on Bill Clinton. It points out that the most recent company restatements involve earnings dating from his administration. The pamphlet also summarizes reports of connections between officials of the Clinton administration and Enron and Global Crossing.

In the House, a Republican staff member passed out reprints of newspaper articles detailing unusual financing arranged for Mr. Gephardt's presidential campaign in 1988 by Terry McAuliffe, who is now chairman of the Democratic National Committee. Another article described Mr. McAuliffe's business connections and his rise as a Democratic fund-raiser.

One of the House's two independent members, Representative Bernard Sanders of Vermont, said both parties were to blame for the 'incredible culture of corporate greed' that led to the scandals. 'Certainly the Democrats have not been strong enough on this issue,' Mr. Sanders said, 'and the Republicans are much worse.'

Experts on regulation dismissed the back-and-forth sniping as misguided.

'I don't see how you can lay the blame for this at the doorstep of the Democrats or the Republicans,' said Robert W. Hahn, director of the American Enterprise Institute-Brookings Joint Center for Regulatory Studies. For a long time, Mr. Hahn said, policy makers have known about the difficulties of ensuring truly independent corporate audits. Like the politicians, independent oversight agencies like the Financial Accounting Standards Board underestimated the problem.

'It's not as if politicians determine all the rules for these things anyway,' Mr. Hahn said. 'The notion that this is lax enforcement on the part of Clinton or his predecessor, Bush, or the Congressional committees is a laugh.'

Robert A. Kagan, a professor of law and political science at the University of California at Berkeley, asserted that economic factors bore as much responsibility for the corporate scandals as political rule-making.

'The Clinton years were a time of huge economic development and change and new markets,' Professor Kagan said. 'That's going to develop the opportunities for new kinds of malfeasance.'

He also suggested that Mr. Gephardt was exaggerating the deregulating success of Mr. Gingrich's time. 'I don't think the Contract With America did very much with regulation,' he said. 'It was sort of a failure. The Republicans blew their opportunity.'

and, in 1999:

Inquiry Sought On Financing By Republicans
NY TIMES, National Desk, May 28, 1999

WASHINGTON, May 27 -- Democrats want the Justice Department and Congress to investigate whether House Republican leaders are violating campaign finance laws with a planned $25 million fund for House races next year.
Advisers to Representative Tom DeLay, the Texas Republican who as the majority whip is the party's third-ranking member in the house, created the Republican Majority Issues Campaign to raise money for two dozen races in 2000.

Others in the fund-raising effort include Speaker J. Dennis Hastert of Illinois; Representative Dick Armey of Texas, the majority leader and No. 4 House Republican, and Representative J. C. Watts of Oklahoma, chairman of the House Republican Conference.

The fund's organizer, Karl Gallant, said it met all Federal election laws and simply mirrored voter-turnout and issue-advocacy campaigns by unions. Mr. Gallant also contended that the fund's activities did not have to be disclosed because it would operate independently and would not explicitly advocate for or against specific candidates.

One request for an investigation came in a letter this week to Attorney General Janet Reno from Robert Bauer, a lawyer for the Democratic Congressional Campaign Committee. The Justice Department declined to comment today.