Reform thrusts Sarbanes onto national stage

Senator: The quiet Maryland Democrat is suddenly gaining attention for his timely bill to boost corporate responsibility.

July 12, 2002|By Julie Hirschfeld Davis | Julie Hirschfeld Davis,SUN NATIONAL STAFF

WASHINGTON - On Capitol Hill, it is often said that the essential ingredient of politics is timing. Sen. Paul S. Sarbanes has learned how true that is.

As the theme of corporate responsibility has catapulted to the top of Washington's agenda, it has also emerged as a topic Democrats hope to use to regain control of the entire Congress. And Sarbanes - a quiet, detail-oriented Democrat known more for policy-heavy testimony than for pithy sound bites - has been swept up in the tide.

The dean of Maryland's delegation, at age 69 and in his 32nd year of a congressional career spent mostly behind the scenes, has suddenly become a major presence on TV news programs, in newspaper headlines and on the national political scene.

After a year as chairman of the Senate Banking Committee, Sarbanes is poised to win passage of an accounting overhaul bill that he drafted behind closed doors in a quiet, bipartisan process. Now, that measure is being aired in a public and highly charged atmosphere.

The Senate is expected early next week to pass the bill overwhelmingly. It would create criminal penalties for securities fraud, force executives and corporate boards to assume legal responsibility for financial statements, and create an independent board to oversee the accounting industry.

"The man and the issue have met at a crucial time," said former Sen. George J. Mitchell, a Maine Democrat who was majority leader from 1989 to 1995 and was a close Sarbanes ally.

For Sarbanes, whose methodical ways have at times elicited grumbles from fellow Democrats and whose media-shy style has earned him a reputation as being gruff and morose, the bill's passage will be a vindication.

After the revelations last fall about Enron's collapse, members of both parties held scandal hearings that drew clusters of TV news cameras and led top executives to plead the Fifth. By contrast, Sarbanes held day upon painstaking day of policy hearings - 10 in all - that attracted few but C-SPAN.

Sen. Jon Corzine, a New Jersey Democrat who, as a former co-chairman of Goldman Sachs, knows the complexities of corporate accounting, calls the Sarbanes hearings "about as effective a seminar on basic finance accounting and corporate responsibility that you can have."

Many Democrats privately groused that Sarbanes' slow pace was allowing momentum on the politically ripe issue to slip away. But his strategy of refining the legislative details and building support from both parties paid off for the Democrats once the pace of the corporate scandals quickened. Democrats had their fully formed bill they could rally around. And Republicans found themselves scrambling to endorse it.

"Senator Sarbanes has done a masterful job in working with Republicans and Democrats alike in dealing with all of those issues," Senate Majority Leader Tom Daschle, a South Dakota Democrat, said this week.

Ed Yingling, chief lobbyist for the American Bankers Association, which has been generally supportive of the bill, said: "There were questions about his style and how aggressive he would be, and there was some concern among Democratic partisans that they might have lost some momentum on it."

"But as the weeks have passed, the timing could not be more perfect. Here you have a bill that is regarded as a well-vetted product ready to go to the floor at the right time."

Sarbanes was first elected to the House of Representatives in 1970 and rose to prominence during the Watergate scandal. As a member of the Judiciary Committee, he drafted the most important article of impeachment against President Richard M. Nixon, charging him with obstruction of justice.

Since then, he has been thrust into some of the most intense policy debates of the past two decades. Yet the senator has labored in relative obscurity, in part because the stars never quite aligned in his favor.

After years of accruing seniority - the source of all power in the Senate - on the Banking Committee, Sarbanes was in line for its chairmanship upon the retirement of Sen. Donald W. Riegle Jr., a Michigan Democrat, in 1994. But his chance was lost that year when the Republicans won control of the Senate.

"The timing's always been off for him," said Christine Sarbanes, the senator's wife of 42 years, whom he met when he was a Rhodes Scholar at Oxford University and she was studying Roman history there.

Christine Sarbanes, who watched her husband most of Wednesday from the Senate Visitors' Gallery, said, "Now he's the chairman of a major committee, and there's this major crisis, and he's in the right place at the right time."

Sarbanes' colleagues on the Banking Committee praise the work he has done in assembling the bill. But some of them suggest that he, like any chairman in charge of a high-profile issue, owes much of his prominence to happenstance.

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