Clinton Says Republicans Blocked His Audit Reforms
     By David M. Halbfinger
LITTLE ROCK, Ark., July 24 Former President Bill Clinton today hailed his own efforts to increase the oversight of corporate governance and criticized Republicans and Harvey L. Pitt, currently the chairman of the Securities and Exchange Commission, saying they had frustrated Mr. Clinton's efforts at reform.
He said Republicans thus deserved some of the blame for the current flight of foreign capital from United States markets.

Asked about President Bush's handling of the economy and his attempts to rally investor confidence, Mr. Clinton, who was touring the construction site of his presidential library here, avoided criticizing his successor directly. Instead, he chided Republicans, who he said had blocked his administration's efforts to, among other things, bar accounting firms from working as auditors and consultants for the same companies.

"I'm sure that some of the people in Congress that stopped a lot of the reforms I tried to put through are probably rethinking that now," Mr. Clinton told reporters.

"Arthur Levitt, my Securities and Exchange commissioner, tried to stop the Enron accounting issues using the same accounting company being consultant and accountant and the Republicans stopped it." Later, Mr. Clinton added that Republicans had fought Mr. Levitt's effort, "and Harvey Pitt was the leader trying to stop us from ending those kind of abuses. That is a matter of record." Mr. Pitt, who was a securities lawyer before being appointed by President Bush to head the S.E.C., counted accounting firms, including Arthur Andersen, among his clients.

When asked if he agreed with senators and representatives who have called for Mr. Pitt's resignation, Mr. Clinton demurred. "I don't have to make those decisions anymore," he said.

Mr. Clinton also said he had been overridden by Republicans when he vetoed a securities-industry bill he said would have "basically cut off investors from being able to sue if they were getting the shaft." And he recalled that his Treasury secretary, Lawrence H. Summers, had tried to crack down on the use of offshore accounts to conceal corporate financial information, but that Senator Phil Gramm of Texas "and other Republicans stopped that."

"And that is one of the things that has caused all the European money to leave the markets, because they see that the government is in the hands of the party that stopped all of this stuff," Mr. Clinton said. "And so I think they've got a burden on their hands, and they seem to be trying to turn it around. We'll see."

Mr. Clinton again criticized Republicans in the White House and Congress when he was asked about investor confidence, suggesting that they ask the opinions of market-moving investors like George Soros and Warren E. Buffett. Those investors, Mr. Clinton said, disapproved of last year's tax cut and "knew it was a mistake to start running deficits again, that it would run long-term interest rates up and again undermine confidence."

But Mr. Clinton said the underlying American economy would "reassert itself sooner or later."


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