Texas power sources

WASHINGTON -- President Bush bestowed the nickname "Kenny Boy" on embattled Enron executive Kenneth Lay back when the two were up-and-comers in Texas.

That doesn't mean they are best buddies; Bush dispenses nicknames freely and not just on intimates. Yet as their careers soared, their interests became more intertwined, whether in business, politics or baseball.

Bush's largest financial benefactor, Lay found him to be a friend of the energy industry when Bush was Texas governor. And Bush made a special trip to Houston during his presidential campaign to attend the Astros' first game at Enron Field, as Lay threw out the first pitch.

They've enjoyed "quality time," Lay has said.

How close their friendship grew has come under scrutiny since Enron, the Houston-based energy giant, filed the largest bankruptcy in U.S. history last month.

It has since been disclosed that Lay contacted officials in the Bush administration, which has at least 15 high-ranking members who owned stock in the company last year. Several Cabinet members acknowledged contacts from Enron but said they did not tell Bush or take any action.

The president calls Lay a "supporter," in recognition of the money poured into his campaigns over the years by Lay, his company and its employees.

'A friendship-friendship'

But he denies speaking with Lay about the company's financial problems and says his administration will aggressively investigate the failure of the company. Enron's fall cost thousands of jobs and vaporized the retirement savings of many employees.

"My sense is that Bush cares about him," said Bill Miller, a political consultant in Austin, Texas, who witnessed Lay's ascent in the corporate world and Bush's rise to governor, then president.

"It was a friendship-friendship, not just a business friendship."

White House and Enron officials insist the two were never all that close. Any idea that Lay is a "close intimate" of Bush is ludicrous, said Bush adviser Karl Rove

"It would be a stretch to call them personal friends," said Enron spokesman Mark Palmer, adding he recalled hearing Lay say that Bush had called him "Kenny Boy" once or twice.

Parsing his words carefully, Bush said last week that it was when he became governor after the 1994 election that "I first got to know Ken." But their relationship apparently goes further back.

Lay, as chairman of the University of Houston board of regents in the late 1980s, tried to bring the senior Bush's presidential library to his school. George W. Bush was involved in setting up the library, which eventually went to College Station, Texas, instead.

Lay says he spent "a little more quality time with George W." during that time.

Criminal, civil and congressional investigations are looming into whether Enron defrauded investors, including 401(k) plan investors, by concealing information about its financial problems.

Bush, sitting on high approval ratings, is hoping his connections to Lay won't become a political liability.