Neil Bush and the S&L Scandal
MANY Americans are pulled two ways as they watch the son of a popular president get drawn deeper into the S&L mire. There's sympathy for the Bush family, but there's also a growing revulsion with the banking scandal - particularly as figures come out about how much each taxpayer in the United States will owe on the estimated half-trillion-dollar tab. Voters are looking for someone to blame. To the extent Neil Bush lost his ethical bearings in the free-wheeling investment climate of the mid-1980s, he may be saddled with a portion of that blame. His dealings when a director of Silverado Banking, Savings and Loan Association in Colorado were symptomatic of the times. The 1,000 pages of investigative documents released by the Office of Thrift Supervision (OTS) last week indicate poor judgment and probable conflict of interest on Bush's part in not fully disclosing business ties to Silverado borrowers.
The charges against Bush should be thoroughly probed during an administrative hearing scheduled for September, and premature assumptions of guilt should avoided. A $200 million civil suit against the Silverado directors, if approved by OTS head William Seidman as seems likely, will extend the probe. As Bush's father said, the ``system'' must be given full rein to find if he's done something wrong and to punish accordingly.
Efforts by congressional Democrats, meanwhile, to unleash an independent prosecutor on the Silverado case appear to spring more from the combustible politics of the S&L mess than from investigative necessity. Politicians are becoming ever more aware that sparks from the thrifts scandal find plenty to ignite on both sides of the aisle, wherever S&L campaign contributions settled. This should impel bipartisan efforts to resolve the crisis.
Many contributed to this financial disaster, from overzealous Reagan ``deregulators'' to bankers who forgot the meaning of the word ``thrift.'' What's needed is an honest assessment of mistakes and a commitment not to repeat them. That applies whether the error lies with Congress - in raising S&L deposit insurance as investment regulations were coming off - or with an individual.