Thursday, January 31, 2002 ! Volume 8, Number 20 Page 1 of 9 Tax restructuring The teeters on the brink Howey !"#$%&'%(#)*+,-.$&/".01&2"3% By BRIAN A. HOWEY, in Indianapolis The historic tax restructuring plan teetered on the brink of oblivion this morning as there appears to be no Political movement within the House Republican caucus to break a party-line vote that might have happened this afternoon. “There is no support that I can see,” said House Report Republican spokesman Tony Samuel late Thursday morning. “The prevailing thought is there is no reason for tax increas- The Howey Political Report is published by NewsLink es, particularly now that the economic indicators are show- Inc. Founded in 1994, The Howey Political Report is ing that we will be pulling out of the recession. They are get- an independent, non-partisan newsletter analyzing the ting calls from the people telling them ‘don’t raise our political process in . taxes.’” Brian A. Howey, publisher House Republicans appeared to have drawn the line in Mark Schoeff Jr., Washington writer the sand over their second reading amendments that were Jack E. Howey, editor shot down by a party line vote one week ago. “They can adopt our second hearing amendment,” Samuel said. “That The Howey Political Report Office: 317-968-0486 would work.” PO Box 40265 Fax: 317-968-0487 Indianapolis, IN 46240-0265 Mobile: 317-506-0883 When House Ways and Means Chairman B. Patrick Bauer, D-South Bend, went to the House microphone to urge [email protected] www.howeypolitics.com his colleagues to defeat the GOP amendment last Thursday, he praised the effort as "a positive step toward solving the Washington office: 202-775-3242; twin dilemmas we are facing. I'm glad you are not standing Business Office: 317-254-0535. up in here and just saying no." The inclusion of the sales, Subscriptions: $250 annually via e-mail or cigarette and gambling tax increases in the GOP plan was, fax; $450 annually including the HPR Daily he said, "a significant step into the light of reality" (Mary Wire. Call 317-254-1533 or 254-0535. Beth Schneider, Indianapolis Star). © 2002, The Howey Political Report. All rights Several wavering Democrats, such as State Rep. Dale reserved. Photocopying, Internet forwarding, faxing or Sturtz, D-Howe, told HPR they could have voted for HB reproducing in any form, in whole or in part, is a viola- 1004 had the Republican amendment passed. “They just tion of federal law and is strictly prohibited without don’t have the votes,” said State Rep. Bob Bischoff of Gov. consent of the publisher. continued on page 2

“We are citizens with obligations to each other Ticker: Bush praises Sen. Bayh p. 2 and to history ...” State of Union: A Demo speech p. 3 HPR Interview: David McIntosh p. 4 - President George W. Bush, in his first State Horse Race: Buyer, Kerns in Cuba p. 6 of the Union address Tuesday evening. Columnists: Pulliam, Rothenberg p. 7 Congress: Enron and Hoosiers p. 8 Thursday, Jan. 31, 2002 Page 2 of 9

BAYH LAUDS BUSH ON VOLUNTEERS: U.S. Senators Evan Bayh and John McCain today hailed President Bush's emphasis on expanding volunteer opportunities in Tuesday’s State of the Union Address. Bayh and McCain, who introduced the Call to Service Act last November, wrote to President Bush last week to encourage him to use the speech to issue a historic call to service. "We believe our proposal is ide- ally suited for the tenor of pass this session, period," State Rep. from page 1 the times," Bayh said. "The Taxes, Craig Fry, D-Mishawaka, said at an American people are look- Frank O’Bannon. Elkhart Chamber of Commerce meeting ing for ways to serve, and State Rep. Jeff Espich, the ranking last Saturday (Don Porter, South Bend we will work with the Ways & Means Committee Republican, Tribune). Fry faulted O'Bannon for asking President to harness this said he believed last Thursday’s rejection the legislators to enact tax increases that outpouring of patriotism to of the GOP amendments might have been the governor consistently opposed when meet the country's needs he served in the legislature. "Don't ask me for civil defense and civic a tactical blunder by the Democrats. renewal. I'm very pleased to “When it was time to look at our to do something you won't do yourself," see President Bush amendments, they ignored the ideas. It he advised O'Bannon. embrace some of the core leaves one wondering if they really want While Bauer tried to hold the line principles in the Call to bipartisan support,” Espich said. “We’re on the administration’s tax plan, he was Service Act that recognizes looking for a good faith effort that will hit abandoned by fellow St. Joseph County Americans' desire to serve the spending side. I don’t think we can Democrats Fry and Mike Dvorak, along causes greater than their compromise any more on revenue neutral- with Republican Richard Mangus. self interests and expands ity.” There was a growing sense of their opportunities to serve House Republicans pondered com- unease over the repercussions of not send- their country. In Winston- ing anything over the Senate, where Salem, N.C., on Wednesday, ing out with a call for more spending cuts President Bush said, “Now, this morning, but Samuel said they decid- Finance Committee Chairman Larry Borst people ask me all the time, ed it was too late in the process to do has already promised to rework the plan you know, ``What can I do something that might be seen as grand- “like nothing you’ve ever seen before.” to help? How can I be a standing. "I don't know how we could look part''--and oh, by the way, I Once again, the O’Bannon adminis- people in the face and ask them to send us look forward to working tration’s top legislative priority appears to back. I want to vote on (tax) restructuring. with my old rival on this ini- be under assault from House Democrats. But there wasn't enough movement here," tiative. One of the things “We're working very hard to get as many Republican State Rep. Tom Saunders said that John McCain spent a (Democratic votes) as we can,” O'Bannon (Muncie Star Press). "If we don't do any- lot of time talking about thing, the voters will send us a message," when we ran against each said Friday. "There's a lot of wavering people out there." Democratic State Rep. TIny Adams said Continued on page 3 "My speculation is that nothing will (Muncie Star Press). " Page 3 of 9 Thursday, Jan. 31, 2002 The moderation of President Bush By BRIAN A. HOWEY to the military. The national gold card will INDIANAPOLIS - President be out for homeland security. It will George W. Bush’s State of the Union “make America not only stronger, but in address Tuesday night could have been many ways, better. Knowledge gained delivered by a Democrat. from bioterrorism research will improve other, and still spends a lot It represents a pendulum swing public health.” of time talking about, is ser- from far right of center to a zone of mod- Bush said he would extend unem- vice. He's a man who under- eration. That’s what the American presi- ployment benefits and direct assistance for stood service to his coun- dency does -- reduces campaign trail stri- health care coverage. “Good jobs begin try. He's a man who knows dency played out for the base and pulls with good schools,” Bush said, “and here that America will be better off as we serve our country. the man into a dynamic where he must we’ve made a fine start. Republicans and And I look forward to work- govern all. Democrats worked together to achieve ing with Senator McCain During the first eight months of his historic education reform so that no child and Senator Bayh of Indiana presidency, Bush surrounded himself with is left behind.And I was so proud of our to get this legislation conservative trappings: the nomination of work, I even had nice things to say about through the Congress.” Attorney General John Ashcroft, the tax Ted Kennedy” (not sure if we’ve ever cuts, the rollback of environmental stan- heard a Republican president praise him). BUSH PUT NATIONS ON dards, a suggestion that American troops “There is more to do. We need to prepare NOTICE; HAMILTON WOR- might be coming home from Bosnia. our children to read and succeed in school RIED: President Bush decid- Tuesday night, we found a with improved Head Start and early child- ed to lump Iran and North Korea with Iraq as members hood development programs.” President Bush who committed himself to of an "axis of evil" whose what cynical conservatives call “nation Bush sought a stimulus package, a support for terrorism seeks building.” The President said, “America patients’ bill of rights and a “modern to acquire and spread and Afghanistan are now allies against Medicare system that includes coverage of weapons of mass destruc- terror. We’ll be partners in rebuilding that prescription drugs.” tion, officials said, despite country.” With Teamster President Jimmy the fact that the two nations Bush identified a future enemy -- Hoffa looking on from the balcony, there have sporadically sought the “Axis of Evil” as FDR or Ronald was a reaction to the Enron debacle. improved relations with the Reagan might have put it -- as Iran, Iraq “Through stricter accounting standards (David E. Sanger, New York Times). and North Korea . and tougher disclosure requirements, cor- Administration officials porate America must be made more Then there is the Bush budget, fea- insisted that Mr. Bush was turing a 9 percent spending increase for accountable to employees and sharehold- not suggesting imminent the next year, topping the 8 percent ers and held to the highest standards of military action against any Congressional Democrats sought last year. conduct.” of the three countries. But “My budget supports three great goals for Bush consistently praised women -- several officials — including America: We will win this war; we’ll pro- from Afghanistan, to teachers, to the need some who had argued for tect our homeland; and we’ll revive our to bolster the Peace Corps and USA toning down the language economy.” Freedom Corps (a move urged by Sens. in drafts of his State of the There will be solace for conserva- John McCain and Evan Bayh) with Union address — said in interviews that the president tives, concerned last August that Bush had 200,000 new volunteers, and in the spirit was insistent that he use jumped over military reform. “My budget of JFK, asking us all to donate 2,000 the opportunity to send a includes the largest increase in defense hours of our lives. There was a bow to his clear warning that any spending in two decades,” Bush said. wife, First Lady Laura (as the camera nation that puts its nuclear “”Because while the price of freedom and panned to Sen. Hillary Clinton, who or biological weapons with- security is high, it is never too high. joined in on the 70 or so applause inter- in reach of terrorists can Whatever it costs to defend our country, ruptions). expect the strongest we will pay.” What a difference a year made in American reaction. Former The spending will not be confined the life of President Bush. " continued on page 4 Thursday, Jan. 31, 2002 Page 4 of 9 McIntosh prepares to re-engage

INDIANAPOLIS - HPR Publisher McIntosh: Ultimately the legisla- Brian Howey sat down with 2000 guber- ture is going to have to deal with them as natorial nominee David McIntosh and a combined product. You can’t have a U.S. Rep. Lee Hamilton said pollster Chris Wilson at the Monon Coffee major restructuring that is also a huge tax on NBC Wednesday he Company in Broad Ripple recently to find increase going parallel with a budget that feared the Bush “Axis of out how the Muncie Republican was plan- needs another tax increase to pay for the Evil” remarks would embolden “hardliners” in ning to re-emerge on the political scene. deficit. What I’ve done is look at them as each of the three counties. HPR: What will you be doing in a combined package. What are they pre- the next three months or so as the tax senting to the people of this state? There’s BURTON SAYS FBI HEAD- debate gears up at the Statehouse? good things in there: eliminating the QUARTERS SHOULD BE McIntosh: I’ve become convinced inventory tax; getting rid of the gross RENAMED’: House that if those are enacted then we’re head- receipts tax are two things I stood for. Government Reform ing in the wrong direction. It will make They’re right, but costly. There are things Committee Chairman Dan the economy worse. We’ll see more job pernicious about it that are just bad policy. Burton used to worship the flight, our opportunties for young people When you man whose name graces will be hurt and the average person will shift taxes the FBI's headquarters. "I always thought J. Edgar be asked to live with a deal where they from property Hoover walked on water will be paying roughly the same on prop- taxes into sales when I was a kid," the erty taxes and a 20 percent sales tax tax, that means Indiana Republican told increase and a 30 percent income tax you’re essen- Mike Wallace on Sunday's increase. My plans in the next three to six tially sending "60 Minutes." But now months are to become re-engaged; to help on the order of $100 million to Burton is investigating give voice to what I think the Republican Washington. There’s a net loss of money Hoover's role in putting an Party should stand for. And that’s an in the pie for Indiana on that tax policy. innocent Boston man, alternative to raising taxes; that we can Progressive income taxes will hurt in the Joseph Salvati, in prison for solve the budget mess without raising exact part of the economy where we need 32 years on a bogus murder conviction, all to protect a taxes. It’s a lot harder now than it would to be attracting young people. What we’re Mafia informant who actual- have been a year ago with a budget sur- saying is, we’re going to be taking more ly committed the crime. plus and the plan we had. Our basic prin- of that reward. Then there are some real Hoover "knew it, and his ciple was right. I think we should hold the bad features in general. The sales and name should not be embla- line on spending and tap into some of the income tax increases. The reason we’re in zoned on the FBI's head- reserves, but not raise taxes in the middle trouble with the budget is there is a down- quarters," Burton said of a recession. I’m going to start giving turn in the economy and we’re not taking (Lloyd Groves, Washington speeches and writing. Politcally, we’re in as many receipts. The proposal that Post). "We ought to change going to get ready to get involved in leg- should be put forward is this: Let’s hold the name of that building. the line on spending at inflation plus 1 or I'm serious." islative races. I don’t think we’d be faced with a huge tax increase proposal if we 1 1/2 , but don’t do double inflation. Last BUILD INDIANA FUNDS had a Republican House. Everyone thinks year I think it was 8 percent. We did a REFORMS GUTTED: As an it’s going to be so tough to win, but I study of 1999 through 2002 time frame. If investigation of the state's don’t think so. I think it could be a ‘94 sit- you hold it to a 5 1/2 percent, you get the Build Indiana Fund contin- uation all over again. $600 million shortfall. If you go down to ues, lawmakers voted HPR: Will you be showing up at 5, you actually get a savings of about Monday to do away with key the Statehouse during the tax debate? $900 million over that period. So spend- accountability measures McIntosh: I will be taking my cues ing is the answer. that govern how millions of from the legislators. The answer is yes. HPR: You advocated a 25 percent taxpayer dollars are spent property tax reduction and if we had done (Michele McNeil Solida, HPR: How do you break down the Indianapolis Star). deficit reduction and tax restructuring that, we would have really been in trou- plans? ble. How will you deal with that? continued on page 5 Page 5 of 9 Thursday, Jan. 31, 2002

McIntosh: That’s a very fair ques- delighted Jim Kittle is chairman. We need tion. Ultimately the core of my plan was people like that. Let’s invest in the party. to use the surplus and hold the line on Let’s use modern approaches where we spending. Take those savings and then cut don’t ask people to contribute everything property taxes. What’s happened since into the central apparatus. His basic Legislators want to resolve then is they’ve used the surplus on spend- premise is, “I can raise money and will let questions about their use of ing. They’re having to raise taxes not to it flow down to the grassroots.” That was the fund by changing the get a tax cut, but just hold the line for the something I learned. You’ve got to invest law to reflect what they average homeowner. If you take the core that time with the party leaders. Now that were doing all along before of my plan now on the savings side, you I’m not running, I can go and say, “What Gov. Frank O'Bannon could do it without raising taxes. You can I do to help you?”The other lesson is ordered the accountability couldn’t get the 25 percent cut because people need to get to know the person measures last year. House Bill 1360, unanimously they’ve already spent that. They spent the they’re going to elect as governor. It’s a approved Monday by the $1.5 billion in surplus and they did an 8 different sense in running for Congress. I percent spending increase last year. Had I House Rules and Legislative run into people all the time who stop me Procedures Committee, also been governor I could have stopped that. at the gas station or Lowe’s and say, “I would allow more groups to We also projected good economic times know you. You’re David McIntosh.” They receive money for a broader so we were thinking there would be more have that sense they know who I am and range of projects. The pro- revenue. I would have had to deal with what I stand for. I’m going to call and that posal also seeks to protect that as a big problem. Realistically, if I and say, “Here’s a vision for our state.” lawmakers and grant recipi- ents from criminal investi- had stuck with the 25 percent, I would HPR: These poll numbers gators by making all past have had to phase it in over a lot longer (McIntosh 44, Tobias 3, Daniels 2, Kenley period. But at a minimum, we wouldn’t spending legal. A Star and Miller 1) send a real message to the have had to raise taxes because we would investigation found that the Republican establishment. Yet we have a $260 million fund has have been good custodians. political culture in this state that you get financed projects that were HPR: Our population is getting only one shot at the governor’s office. never built and benefited older; Medicaid will go up. We’re locking Chris Wilson: Indiana and Ohio lawmakers personally, and up more people. And we’re not growing aren’t really all that different. Ohio has a that money has gone to as fast as other states. Is it realistic to groups that were never culture where you almost have to lose a think we can hold the line on spending? audited. Marion County race before you come back and win it. McIntosh: No, you’ve got to do Prosecutor Scott Newman Voinovich, Celest, DeWine, Glenn - they things such as eliminate the inventory tax, launched investigations of and you have to bite the bullet to do that. all lost a race. My opinion as a pollster is some lawmakers and grant recipients. The investigation in order to stimulate economic growth. that the nomination is David’s if he wants will not be hampered if the The brain drain leads to the aging of the it; 41 points is not a small matter. It would take a lot of money to overcome that. bill becomes law, said demographic: More expenses and less spokesman Roger Rayl. McIntosh: My perspective is that is budget income for the state. Rep. Win Moses, D-Fort HPR: You’ve run four campaigns, the old wisdom out of the old style. One Wayne and sponsor of the three real good ones and then that stinker of our best leaders in this state ever, is proposal, said he doesn't in 2000. How do you deal with that coun- Dick Lugar. People forget, but he lost an believe lawmakers did any- ty chair who asks, why should we go with election for the Senate before he won. I’ve thing illegal, "but this would you in 2004? been studying races like Jeb Bush’s down eliminate any worry." Indianapolis community McIntosh: What became real clear in Florida where he lost and then won again. I’ve talked with people about activist Clarke Kahlo said from this (Wilson) polling. We had the he's appalled by the propos- putting together a good team for next right message, but it was an election too al: "This takes grandfather- early. It wasn’t going to work in 2000, but time. I’ve got a vision that will work. I ing to a whole new low." it will in 2004. I will share that with them. will pull together a team that knows You also learn along the way, things you Indiana and knows how to win. That will WOMEN UNDER-REPRE- will do better. I’m going to spend time include people who have been with me investing in the party structure. I’m before and some new people. " continued on page 6 Thursday, Jan. 31, 2002 Page 6 of 9

Stuart Rothenberg, Roll Call - At a regressive tax that takes advantage of least 10 former Members are mentioned people in the lower income brackets. SENTED ON INDIANA CON- as possible or certain candidates for the Then I started seeing what really goes on GRESSIONAL STAFFS: House this year. Statistics are tough to at casinos, which are among the most Women make up half of the come by, so I don't know if that's a record. highly regulated businesses in the nation. total Indiana staff in the Although some in this year's crop have People eat, gamble and go home when House but only 30 percent legitimate chances to win, many are run- they've exhausted the money they set of the policy positions and ning quixotic efforts to return themselves aside for their day's entertainment. I've yet 18 percent of the top four to see a study anywhere that points to a jobs, according to a Gannett to the political stage. Eight of the poten- significant social problem with compul- News Service analysis of tial comebackers lost their last bids for the aides on the payroll as of House: Dave Nagle (D-Iowa), Jay Dickey sive gambling, or any solid data that Sept. 30, the most recent (R-Ark.), Buddy Darden (D-Ga.), Frank shows that compulsive gambling has published records. That's McCloskey (D-Ind.), Robin Britt (D- increased in Indiana since riverboat gam- better than Fortune 500 N.C.), Merrill Cook (R-Utah), Jill Long bling and parimutuel betting were legal- companies where women Thompson (D-Ind.) and Clyde Holloway ized. Illegal gambling was rampant in pri- hold 12 percent of the exec- (R-La.). The biggest problem facing many vate clubs and taverns before casinos utive positions. But it's not among those eight is that the voters have arrived and it persists today. Legal gam- as good as the entire House already fired them. And yet, most of those bling provided the cash-strapped state of where women hold 41 per- Indiana and local governments roughly cent of the policy jobs and considering a comeback in 2002 have rea- $500 million in revenue in 2001. So why 38 percent of the executive sonable rationalizations for their losses positions. In Sen. Evan and for why this year could be different. are Gov. O'Bannon and the Democrats in Bayh's and Richard Lugar's Redistricting appears to be the major rea- the Legislature proposing legislation to offices, women made up 33 son why so many former Members figure increase casino taxes and opposing mea- percent of the top jobs as of that they can again win election to the sures to enhance the viability of the state's September. That's just House. Rep. Bob Barr (R) defeated 10 licensed operators? " slightly below the Senate Darden by 4 points, the same margin by average of 37 percent, which (R) prevailed over Russ Pulliam, Indianapolis Star - although the gender pay gap in Indiana's offices is McCloskey, a former mayor of One other person would give Kernan a larger than in the entire Bloomington. Both Democrats can rea- fight: former Sen. . Now Senate. Angela Flood, the sonably argue that they would still be in ambassador to Germany, Coats originally who worked her way up Congress if it hadn't been for the GOP hoped to be Secretary of Defense. Unless from an entry-level position wave. Long lost by a larger margin (11 he is asked to join the Bush cabinet in the over a dozen years in points) to (R), but two years meantime, he could bring plenty of cre- Congress, is the only earlier she had been re-elected with 62 dentials to a race against Kernan, includ- female chief of staff (U.S. percent of the vote. " ing previous successful statewide runs; Rep. Mark Souder) in the 12- popularity with the social and religious member Indiana delegation. Mike Leonard, Bloomington Herald- conservatives who vote heavily in HOUSE PASSES PROVI- Times - There was a time when I would Republican primaries; and a strong pro- SIONAL BALLOTS: The have counted myself within the odd coali- life record. He also can lay claim to some House voted unanimously tion of liberals and religious moralists of the faith-based ideas put into play by Wednesday to ease and who oppose casino gambling. OK, I was- Bush, as the author of innovative ideas for expand Indiana's voting n't one of the moralists. Who would have compassionate conservatism as far back as process (Niki Kelly, Fort guessed? I leaned toward the liberal view his time in the U.S. House of Representa- Wayne Journal Gazette). that too many people who can't afford to tives in the 1980s. The new state chairman House Bill 1224 would allow has a big job ahead. He may have to unrestricted absentee vot- gamble do so with hopes of improving their economic lot — and that amounts to recruit overseas to get it done " Page 7 of 9 Thursday, Jan. 31, 2002 Indiana 2002 Racing Form Secretary of State 2002: Republican: Kent Benson, Mike Delph, Deputy Secretary of State , Richard Mourdock, Dr. John McGoff. Democrat: Bloomington Mayor John Fernandez. Libertarian: Paul Hager. 1994 Results: Gilroy (R) 902,100, Jeffers (D) 542,539, Dillon (L) 32,483, Knight (A) 13,948. 1998 Results: Gilroy 828,557, Little (D) 652,565, Dillon (L) 51,775. 2002 Forecast: Fernandez sent out packets of ing for the month leading up information to state and national media outlets to the election and make it touting his role in keeping the city’s tax rates easier for out-of-state mili- low. And he’s spending $6,000 in public funds tary personnel to cast their to do it (John Meunier, Bloomington Herald- ballots. Times). Republican Kent Benson said, “Sounds like politics as usual again for the Democrats.”. Status: Toss-up. SHINE WILL GET NEW TV Republican: Open. Democrat: U.S. Rep. Pete Congressional District 1: SHOW IN FORT WAYNE: Visclosky. Geography: Lake, Porter, Newton, Jasper, Benton counties. Media Market: Steve Shine, the Allen Chicago. 1994 results: Visclosky 68,612, Larson 52,920. 1996 Results: Visclosky 132,430, County Republican chairman Petyo (R) 56,205, Crass (L) 3,122. 1998 Results: Visclosky (D) 92,634, Petyo (R) 33,503. whose unique baritone voice 2000 Results: Visclosky 146,683, Reynolds (R) 56,200, Nelson (L) 2,907. 2002 Forecast: has brought news updates to Visclosky has filed for another term. Status: SAFE D. WFFT-TV, Channel 55, view- Congressional District 2: Republican: Chris Chocola. Democrat: Jill Long ers for years, is putting his Thompson, Mark Meissner, State Sen. William Alexa, Kathy Cekanski Farrand. Geography: TV career on hold. At the end South Bend, Michigan City, Mishawaka, Elkhart, Kokomo, Plymouth, Logansport; LaPorte, St. of the month, Shine will no Joseph, Starke, Marshall, Pulaski, Fulton, Cass, Carroll and parts of Howard, Porter, Elkhart longer appear on the news and White counties. Media Market: South Bend-Elkhart, Indianapolis, Lafayette, Chicago. breaks he has hosted since 2000 Result: Roemer (D) 107,076, Chocola (R) 98,367. 2002 Forecast: Thompson raised Jan. 21, 1981 (Mike Gruss, $89,060 from July 1 to Dec. 31, according to her FEC filing. She has raised $189,040 year-to- Fort Wayne Journal Gazette). date and has $121,230 cash on hand. . Status: Leans JLT. Shine says he plans to reap- Congressional District 4: Republican: U.S. Rep. , U.S. Rep. Brian pear on television for more Kerns, State Sen. Mike Young. Democrat: Open. Geography: Tippecanoe, Clinton, Boone, serious matters. "Shine on Montgomery, Hendricks, Morgan, Lawrence and parts of Marion, Johnson, Monroe, Fountain Sunday," a political talk and White counties. Media Market: Lafayette, Indianapolis, Terre Haute, Evansville, show, will feature local politi- Louisville. 2000 Results: Old 5th CD: Buyer (R) 132,035, Goodnight (D) 81,423; Old 7th cal leaders with Shine as the CD: Kerns 131,562, Graf (D) 65,174.. 2002 Forecast: It might be reasonable to expect the host. action in the 4th CD to be played out in Tippecanoe County or Plainfield. But both Kerns and Buyer ended up in Cuba. Buyer went down to inspect the Guantanamo Bay prison facilities for PAIR ANNOUNCE FOR LEG- the Taliban and Al Qaeda on Friday. “I am going to Guantanamo Bay on a fact-finding mis- ISLATURE: Two candidates sion,” Buyer said. “I want to ascertain the difference between fact and fiction.” Kerns said, for the Indiana General "We wanted to go down and dispel any notion that we were not doing the right thing." Assembly made their Status: Leans Buyer. announcements over the Congressional District 7: Republican: Brose McVey. Democrat: U.S. Rep. weekend. H. Jay Walton of . Geography: Indianapolis. Media Market: Indianapolis. 2000 Results: Carson Lawrence County will seek (D) 91,300, Scott (R) 61,818, Ali (L) 2,513. 2002 Forecast: McVey raises $120,000, with the 65th District seat in the $50,000 on hand. Tim Searcy, a marketing executive, will manage the McVey campaign. House of Representatives. Status: Leans Carson. The announcement in the Congressional District 8: Republican: U.S. Rep. John Hostettler. Democrat: Bedford newspaper did not Bryan Hartke, Frank McCloskey. Geography: Evansville, Terre Haute, Greencastle; Posey, say what party’s ticket he Vanderburgh, Warrick, Gibson, Pike, Martin, Daviess, Knox, Sullivan, Greene, Owen, Clay, will run on. Republican Vigo, Vermillion, Parke, Putnam, Warren and part of Fountain counties. Media Market: Andrew Phipps announced Evansville, Terre Haute, Indianapolis. Lafayette. 1994 results: Hostettler (R) 93,529, for the District 26 Senate McCloskey (D) 84,857. 1996 Results: Hostettler (R) 109,582, Weinzapfel (D) 106,134, Hager seat held by Allie Craycraft, (L) 3,799. 1998 Results: Hostettler (R) 92,227, Riecken (D) 81,381, Hager (L) 3,395. 2000 D-Selma, since 1978. State Results: Hostettler 116,860, Perry (D) 100,461. 2002 Forecast: Former Rep. Frank Rep. Bruce Munson, R- McCloskey ponders a comeback, though he lives just outside the CD. Vice President Dick Muncie, also has not ruled Cheney will stump for Hostettler in Evansville on Feb. 6. Status: Likely Hostettler. " continued on page 8 Thursday, Jan. 31, 2002 Page 8 of 9 Pension reform rises from Enron collapse

By MARK SCHOEFF Jr. to change the retirement savings system. The Howey Political Report Members of the Hoosier delegation are WASHINGTON--Pension security sorting through bills that have cascaded out seeking the GOP nomi- has risen from the ashes of the spectacular out of the Enron scandal. nation for Senate seat. collapse of Enron Corp., putting an issue "Before we overreact, we need to Munson is not seeking re- on the fall agenda that might otherwise understand what happened here," said election to his House 35 have languished in obscurity. Chocola, who is chairman of the board of seat. After the Houston energy-trading CTB International Corp., an agricultural giant lost $638 million in the third quarter equipment CBS-NEW YORK TIMES manufac- POLLS SHOWS ENRON and its market value plummeted by $1.2 HURTING REPUBLICANS: billion, it declared the largest bankruptcy turer that According to a CBS in history. Thousands of Enron employees employs News/New York Times poll, lost their jobs and retirement savings. 1,300 while the President's popu- Investigations into the complex financial people larity remains high, two out and accounting breakdown will occupy and has a of three Americans now several congressional committees. In addi- market value of about $120 million. "The believe the Administration tion, the company donated more than $1.7 401(k) program overall is a good one that is hiding something in the million in the 2000 election, spurring a lot of people have benefited from." Enron case. 75 percent of For more than a decade, Chocola those polled say Congress enough members of the House to sign a designed and managed his company's pen- is influenced too much by petition to force action on a campaign big business. Americans finance reform bill that had been stalled. sions. CTB matches with cash the dollar also believe Enron is not an Although the political vibrancy of amount that employees put into their isolated case; 70 percent campaign finance reform outside the retirement accounts. Employees can then say the accounting prac- nation's capital is always debatable, pen- decide where to invest. Enron made its tices that led to Enron's col- sion security might get traction. match on retirement funds with company lapse are widespread. "The whole issue of pension protec- stock and restricted employee options. tion will be big this year," said Chris In southern Indiana, Democrat GOP EYES THREE INDIANA Sautter, a Democratic political consultant is drawing on his background SEATS: Jack Oliver, deputy as a financial analyst to address the Enron chair of the Republican helping to run 's cam- issue. Before Hill was elected to the 9th National Committee, said paign in the new 2nd CD. "In all races, the national party is voters will be more favorable to candi- CD seat in 1998, he worked for Merrill increasingly excited about dates who support pension protection, Lynch. the potential of picking up especially protection from employer mis- "I took this job very seriously three Congressional seats management." because I knew every one of my clients in Indiana: the open 2nd, Melina Fox, the Democratic chal- had worked hard for years to save money along with the 7th and 9th. lenger to GOP Rep. in the that would help them make ends meet U.S. Rep. is after retiring," Hill wrote in an op ed he vacating the 2nd, and the new 6th CD, said that Enron is on the minds of Hoosiers. "Everywhere I go, sent to Indiana newspapers on Wednesday. 7th and 9th are currently "Congress should consider common sense held by U.S. Reps. Julia people are talking about the Enron scan- safeguards that would prevent employees Carson and Baron Hill. dal," she said. "(They) are worried about “There will be 30 to 40 com- making sure their retirement funds are from getting soaked while a company's petitive House seats and secure." executives emerge relatively unscathed." three of them are located Hill outlined reform steps that include giv- here,” Oliver said before ing workers access to investment advice, huddling with new Indiana Business Background improving disclosure and transparency of Republican Chairman Jim The pension focus might provide an financial information, and promoting Kittle at the Columbia Club. opening for candidates to highlight their greater auditor independence. “We’re sitting down and business background. Chris Chocola, a One of Hill's potential Republican planning with Jim and mak- Republican running for the open seat in opponents, , may be able to ing sure we have the grass- the new 2nd CD, cautions against rushing Page 9 of 9 Thursday, Jan. 31, 2002 talk about his experience in providing Republicans and Democrats, some retirement benefits to employees of his observers have speculated that Democrats Jeffersonville trucking company. might use the scandal probe as payback for the impeachment of former President Goliath and David Bill Clinton. Former Enron Chairman Ken Lay had strong connections to Regardless of a politician's back- roots apparatus in place. We ground, the idea that the business Goliath President George W. Bush, and represen- tatives of the company had a role on the believe the 2nd and 9th are took advantage of the worker David res- very much in play. All three of energy task force headed by Vice onates on both sides of the aisle. these seats create opportuni- Republicans and Democrats criticize the President . ties when you consider there is Buyer said that Washington has an Enron system that allowed executives only a six-seat difference in the "existing architecture" for scandal more choices for investing their retire- House.” Oliver said that recent intrigue. "It's a cottage industry in its own Congressional generic polling ment savings than it gave to employees, right." But he cautioned against over- shows the GOP in better shape who had to buy company stock. reaching. "Just because someone had a on the key issues of homeland Republican Rep. Steve Buyer (new relationship with someone and that person security, public education and 4th CD) said that point concerns his con- turned bad, it doesn't mean it's guilt by the economy, as opposed to stituents. "Employees should have rights 1994 and 1998, the last two association," he said. to the open market, just as executives do." mid--terms when the The stakes are too high for Democratic Rep. Julia Carson (new Republicans trailed in generic Democrats to seek revenge for the 7th CD) said, "There has to be a mecha- polling this early in the cycle. A Monica Lewinsky investigation, Carson nism that protects employees and their CBS/New York Times poll said. "In a situation as grave as this, we shows 37 percent would vote pensions. They cannot be denied the right pretty much have to keep our attention for the Republican candidate in of the option of moving their money." focused. We're not kids on the playground their district; 39 percent would --you hit me, and I'll hit you back. This is vote for the Democratic candi- Congressional Hearings serious business that affects the lives of date. Buyer and Carson both serve on so many families." PENCE SUPPORTS ARCTIC committees that will investigate Enron Pence said neither party could be DRILLING: Rep. Mike Pence and its accounting firm, Arthur Andersen. held accountable for Enron. "I don't think supports oil drilling in the Buyer is on the House Energy and this is a Republican or a Democratic Arctic National Wildlife Refuge; Commerce Committee. Carson is a mem- thing." He called it something on which Sen. Evan Bayh opposes it, ber of the House Financial Services both sides can agree: "outrageous behav- and Sen. Richard Lugar Committee. ior by corporate executives." " remains undecided (Seth Although Enron donated to both Slabaugh, Muncie Star Press). Bayh has opposed past attempts to allow energy devel- Indiana Bankers Association opment in the refuge and will continue to do so, said Mark The Fort Wayne Business Forum Kornblau, his press secretary. Economic Club of Michiana Lugar, too, has voted in the Howey Indiana Credit Union League past against oil drilling in the Evansville Chamber of Commerce refuge, but has not decided Political Indiana League of Savings Institutions how he will vote the next time the issue comes up, said Andy Report Terre Haute Rotary Fisher, Lugar's press secre- Central Soya PAC tary. NECA (organizations whose members have heard Brian Howey’s Political Analysis up front and in person) " To inquire about fees and scheduling, call 317-254-1533 or e-mail: [email protected]