- The Washington Times - Friday, July 19, 2002

House Minority Leader Richard A. Gephardt said yesterday that the furor over corporate responsibility could help Democrats win in as many as 40 districts in November, and Republicans accused him of waging a campaign of "economic destruction."
"There are at least 40 seats in play that we have a chance to win," said Mr. Gephardt, Missouri Democrat, before hosting a Democrats-only hearing that featured criticism of Republicans' business-friendly policies.
Party leaders often make overly optimistic predictions about gaining seats in midterm elections. But Mr. Gephardt disputed a published report that he has been predicting that Democrats will pick up 30 to 40 seats based on the issue in the fall, calling it "a misunderstanding." He said he has been telling colleagues only that campaigning on the corporate-accountability issue will give Democrats a better chance of winning in each of those races.
A senior Democratic leadership aide added, "We'd have to go to church every day and pray to end up with even a one-seat majority."Republicans hold a 222-211 advantage in the House, with two independents.
Rep. Thomas M. Davis III of Virginia, chairman of the House Republicans' campaign committee, laughed when asked about Mr. Gephardt's optimism.
"He's hallucinating," Mr. Davis said. "He needs to take his medicine."
And House Majority Whip Tom DeLay, Texas Republican, accused Mr. Gephardt of exploiting investor jitters and the plunging stock market for political gain.
"In a time when we as leaders should be helping to restore confidence in our economy and the free-market system, Dick Gephardt is practicing the politics of economic destruction," Mr. DeLay said. "He has become just another pandering, permanent partisan."
Republicans said they were not so much alarmed by Mr. Gephardt's reported prediction as they were by his suggestion, in their view, that Democrats should exploit the ailing stock market.
Speaker J. Dennis Hastert said it was "unconscionable that someone would play politics with an issue as important as the American economy."
"Every American family has a vested interest in the stock market, whether it is with securities, with 401(k)s, or with pensions," Mr. Hastert said. "Hoping [-] for political reasons [-] that the stock market continues to slide or that scandals continue to hit major American companies is simply wrong. People's livelihoods are at stake here."
Gephardt spokeswoman Kori Bernards said that "the only politics of economic destruction is the Republican leadership standing in the way" of the Senate-approved bill that calls for an independent oversight board on accounting practices and tougher penalties for corporate fraud. Lawmakers say they expect to complete a House-Senate conference on the legislation next week.
Democrats believe they have Republicans on the run with the issue. Senate Majority Leader Tom Daschle yesterday called on House Republican leaders to simply approve the Senate bill, which unlike the House bill would put the oversight board out of the control of the Securities and Exchange Commission.
And Mr. Daschle, South Dakota Democrat, credited Democrats' vociferous objections in the media with forcing House Republicans to squelch a move to send the legislation back to the Senate this week.
"A little light brought a different reaction," he said.
Mr. Davis said his polling does not suggest that Republicans are being hurt by the corporate scandals.
"There's no evidence right now that the [issue] is dragging anybody down," Mr. Davis said. "I'm more concerned about the state of the economy than all the rhetoric."
Democrats have been searching without much success all year for a reliable campaign issue, and many Democrats believe they now have one. But Mr. Davis said corporate accountability is "just the latest issue du jour" for Democrats.
"These guys have had an issue du jour for months," he said. "I just don't think we're going to be stampeded."
And a top Democratic House aide cautioned, "It's only July. We've had them on their heels on July 17 before."
At the forum hosted by Mr. Gephardt, witnesses criticized Republican policies for contributing to the stock market woes. New York State Attorney General Eliot Spitzer, a Democrat, said House Republicans "have been actively critical" of his efforts to crack down on conflicts of interest arising from investment analysts writing stock reports that could benefit their firms.
"The refusal of the Republican majority to address the investing public's concerns about the conflicts infecting the research recommendations that they receive will simply result in the public's hesitation to re-enter the market," Mr. Spitzer said.
A Gephardt aide said Republicans were not invited to the hearing, in which about 15 Democratic House members took part. Also testifying at the hearing was former Federal Reserve Chairman Paul Volcker, who has been calling for reforms in auditing practices.
Mr. Gephardt told the televised audience that "the issue before us is not about politics." Then he laid much of the blame for the crisis on the Republican-led Congress of the 1990s.
"Too many times in the last seven or eight years, the special interests and extremist voices that would like to get rid of almost all regulations have triumphed in the face of common sense and the sentiment of the majority of the American people," he said.
Democrats in Congress have spent months seeking solutions to this crisis, and we are prepared to go to any part of this country to figure out what happened, why it happened and the best way to help fix the problem."


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