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1.26.2004

Oh, brother!

January 9, 2004

Ah, it's nice to be Neil Bush. When you’re Neil Bush, rich people are eager to invest in your businesses, even though your businesses have a history of crashing in spectacular fashion.

When you're Neil Bush, you'll be sitting in a hotel room in Thailand or Hong Kong, minding your own business, when suddenly there's a knock at the door. You answer it and a comely woman strolls in and has sex with you. Life sure is fun when you’re Neil Bush, son of one president, brother of another.

Just how much fun was revealed in a deposition taken last March, during Bush’s nasty divorce. Asked by his wife’s lawyer whether he’d had any extramarital affairs, Bush told the story of his Asian hotel room escapades.

"Mr Bush," said lawyer Marshall Davis Brown, "you have to admit that it’s a pretty remarkable thing for a man just to go to a hotel room door and open it and have a woman standing there and have sex with her."

"It was very unusual," Bush replied. Actually, it wasn't that unusual. It happened at least three or four times during Bush's business trips to Asia, he said. "Were they prostitutes?" asked Brown. "I don’t — I don't know," Bush replied.

"Did you pay them?" "No." Unsurprisingly, the revelation made headlines worldwide. Equally unsurprisingly, the sex story overshadowed the curious financial revelations that came out in the same deposition.

In 2002, for instance, Bush signed a consulting contract with Grace Semiconductor — a Shanghai company. He is to be paid $US2 million ($A2.6 million) in company stock over five years, plus $US10,000 for every board meeting he attends.

"Now, you have absolutely no educational background in semiconductors, do you, Mr Bush?" Brown asked.

"That's correct," Bush responded. Ah, it's nice to be Neil Bush. Bush is the latest manifestation of an American tradition: the president's embarrassing relative.

There was Sam Houston Johnson, who used to get drunk and blab to the press until his brother, Lyndon, sicced the Secret Service on him. And Donald Nixon, who dreamed of founding a fast-food chain called Nixonburgers and who accepted, but never repaid, a $US200,000 loan from billionaire Howard Hughes.

And Billy Carter, who drank prodigious quantities of beer, wrote a book called Redneck Power and took $US200,000 from the government of Libya. And Roger Clinton, who spent a year in prison for cocaine dealing. But Neil Bush has surpassed them all: He has become the embarrassing relative of two presidents.

In the late ’80s and early ’90s, Bush embarrassed his father, George Bush snr, with his dealings as board member of the infamous Silverado Savings and Loan, whose collapse cost American taxpayers $US1 billion. Now Bush has embarrassed his brother George with a divorce that featured paternity rumours, a defamation suit and even allegations of voodoo.

Born in 1955 as third of the five Bush children, Neil has a degree in international economics and an MBA. In 1979, while working on his father's unsuccessful campaign for the 1980 Republican presidential nomination, Neil met Sharon Smith. They married and moved to Denver, where Bush got a $US30,000 job negotiating mineral leases for Amoco.

In 1982, Neil and two co-workers quit and formed an oil exploration company, JNB Exploration. Bush was in charge of raising money. "Neil knew people because of his name," one partner, Evans Nash, said later.

Among those Bush knew were two real estate barons, Bill Walters and Ken Good. Walters invested $US150,000 and set up a $US1.75 million line of credit for JNB at a bank he owned. Good invested $US10,000 and pledged loans worth $US1.5 million. Good also lent Bush $US100,000 to gamble in the commodities market and said Neil didn't have to repay it unless he made money.

Bush paid himself $US66,000 a year. In five years JNB drilled 26 wells but found not a drop of exploitable oil. It would have gone bankrupt if not for Walters and Good.

But Bush was able to help the men who helped him. In 1985 he joined the board of Silverado Savings and Loan. Over the next three years, Silverado lent another $US106 million to Walters and $US35 million to Good.

Good used some of that money to buy JNB, raising Bush's salary and awarding him a $US22,000 bonus. He also hired Bush as a director of one of his companies, at a $US100,000 salary. Neither Good nor Walters ever repaid their loans. In 1988 Silverado went belly up.

Regulators from the federal Office of Thrift Supervision concluded in 1991 that Bush's deals with Good and Walters constituted "multiple conflicts of interest". Bush became a public symbol of the $US500 billion savings and loan scandal. Bush then started Apex Energy, a methane gas exploration company. He invested $US3000 himself and got $US2.3 million from companies run by his father's friend Louis Marx, heir to the Marx toy fortune.

Neil paid himself a salary of $US160,000 and sold a Wyoming gas lease he owned to Apex. The lease proved worthless. Apex went broke after two years.

An investigation by the House Small Business Committee found nothing illegal or improper but noted that a $US2 million federally guaranteed investment to an applicant who risked only $US3000 of his own money seemed like "a very high leveraging of funds".

For several years, Bush's main business interest has been Ignite!, a software company he cofounded in 1999. To fund it, Bush has raised $US23 million. Last year, Ignite! entered into a partnership with a Mexican company. The partnership enabled Ignite! to lay off half of its 70 employees and outsource their jobs to Mexico.

"That's turned out to be great," says Ignite! president Ken Leonard.

"He's incorrigible," says historian Kevin Phillips, author of the forthcoming book American Dynasty: Aristocracy, Fortune and the Politics of Deceit in the House of Bush. "He seems to be crawling through the underbelly of crony capitalism."

Bush vehemently denies that. "I have never used my family name to 'cash-in'," he wrote by email. "Unfortunately, such ridiculous charges come with the territory of coming from a famous and public family."

The territory of divorce can be troublesome, too. In 2002, Bush told Sharon that he wanted to separate. He took up with Maria Andrews, who was an aide to his mother. The divorce was a candidate for the Nasty Break-up Hall of Fame. Among claims aired was that Sharon had yanked hair out of Bush’s head to make a voodoo doll and put a curse on him.

These days Bush divides his time between Texas — home of his children and Ignite! — and Paris, where Maria lives.

Somehow, even after all his travails, it's still nice to be Neil Bush.

http://www.theage.com.au/articles/2004/01/08/1073437410662.html