Analysis: Scandals tarnish Bush image

Growing scrutiny of Bush's time as oil firm director

By Stephen Evans BBC North America business correspondent

By any account, George W Bush remains a hugely popular president - the polls show his ratings at historically high levels.

Three-quarters of Americans say he is still doing a good job as president, a level of support that even former President Ronald Reagan would have envied.

The danger for Mr Bush is that he comes to seem in the minds of voters like a businessman sticking by his friends when his friends have behaved badly

It is clear that Mr Bush's popularity stems from the war on terror. He comes over as genuine and resolute on the issue that dominates American politics.

Or rather, did dominate American politics - corporate corruption is moving up the agenda, and as it rises in prominence so dents start to appear in Mr Bush's popularity.

Questionable history

On a recent, reliable poll, Mr Bush had high overall approval, but with a sizeable expression of doubt about his handling of the economy and of his dealings with business.

Only a third of Americans believed he was "doing all he can" on the economy.

There is growing scrutiny of his behaviour when he was a director of an oil company in 1990.

Bush must distance himself from financial scandal

Mr Bush sold shares before the price dropped, and was then not prompt in informing the authorities about the transaction, a mistake he likens to slightly exceeding the speed limit.

On top of that, the Vice-President, Dick Cheney, ran an energy company before coming to power, and that company's accounting methods are now being scrutinised.

None of which means that the Bush administration is on the ropes. American attitudes to corporate wrong-doing may differ from those in Europe or Asia, for example.

Economic damage

It is certainly true that achieving great wealth has no stigma in the US, and there is much more of a sense that executives try and fail and try again without incurring shame.

Public resentment over the loss of investments is growing

So, corporate failure on a grand scale does not necessarily imply political damage.

But this wave of corporate failure has caused substantial economic damage. Many of the big pension funds for state employees, for example, invested heavily in - and lost heavily from - Enron shares.

Their impoverishment is accompanied by huge enrichment of the people at the top of the companies, like Enron and WorldCom, which tumbled.

The two sides of the collapse may feed resentment.

Growing criticism

Mr Bush is the first president to have earned a Master's degree in Business Administration, an MBA. He comes with a natural resistance to more regulation.

His critics, however, seem to be gaining strength with each new scandal - and they are proposing much tougher change than Mr Bush likes.

Democrats, for example, along with a growing number of Republicans other than the president, want a new, independent, well-funded agency to oversee accountancy firms, something the accountancy industry is lobbying fiercely against.

One reliable estimate has them contributing $4m so far to politicians' campaign funds.

Political danger

Two weeks ago - before the WorldCom scandal - the chances of this tougher proposal for reform becoming law would have seemed slim.

Today, its chances are higher.

Mr Bush's speech didn't assuage his critics in Congress. It was a speech, though, to several audiences.

His political audience may not have been that moved from its previous position - those that want tougher regulation of the accountancy firms will probably still want it; those sceptical of regulation will probably have their scepticism undimmed.

His popular audience, though, may well have been swayed by the strong rhetoric. Certainly, in the tourist spots away from Wall Street, there was no shortage of people whose faith in their President remained strong - and who, whatever else they may doubt, do not doubt his sincerity.

And his business audience was left in no doubt that if bending and breaking the rules was part of the culture of the 90s, it does not have that sanction of the wrold's most powerful man anymore.

Rhetoric is only words - but sometimes words are important.