Monday, November 21, 2005

"I don't listen to his words as much as I look at his actions."

The chairman of Amtrak: Savior or undertaker?

November 21, 2005

By Robert Cohen
Star- Ledger Washington Bureau
Copyright 2005

WASHINGTON -- As chairman of the Texas Transportation Commission under then-Gov. George W. Bush in the late 1990s, David Laney was credited with significantly increasing highway funding and boosting development of toll roads.

Along the way, friends say, he developed a thick skin, absorbing criticism from those who didn't get the millions of dollars in highway and bridge money they wanted and from those who opposed his construction plans.

Now as chairman of the board of Amtrak, Laney has come under a withering attack from members of Congress who accuse him of leading a Bush administration effort to dismantle the national passenger railroad and turn it over to private interests.

Laney insists he's not out to ruin Amtrak, but to save it: "We want to fix Amtrak's problems, and make it better."

But after the board of directors moved secretly to separate the valuable Northeast Corridor from the rest of the rail system, then fired popular Amtrak President David Gunn, angry lawmakers called Laney to a congressional hearing and told him to his face that they don't trust him.

Some drew comparisons to Michael Brown, the former director of the Federal Emergency Management Agency who was fired after FEMA's botched response to Hurricane Katrina.

"Amtrak is now being run by a board made up of members who have virtually no experience in passenger rail," Rep. Jerrold Nadler (D-N.Y.) said during the contentious hearing. "In short, Mr. Gunn was fired because he would not agree with FEMA-tizing Amtrak."

Sen. Frank Lautenberg (D-N.J.) in an interview described Laney as a "smooth talker" who is serving as Amtrak's "undertaker." And Rep. Robert Menendez (D-13th Dist.) accused Laney of "failing to be an honest broker," telling Congress one thing while secretly planning to carry out White House anti-Amtrak plans.

In a telephone interview last week, Laney strongly denied he has any plans to destroy, dismantle or privatize the national rail line, and insisted he is independent of the White House.

"Nobody is sitting around giving me any kind of orders or direction," Laney said. "President Bush trusts my judgment on organizational and transportation issues, and I hope I am living up to that." Laney added he intermittently "gives the White House reports on what is going on with Amtrak if they ask," and works closely with the Department of Transportation.

Asked about the harsh criticism, Laney laughed and suggested it is just a combination of Capitol Hill politics and a misunderstanding of his intentions.

"People have their own agendas," said Laney. "I am very comfortable with my qualifications. If people want to challenge me or cast aspersions, so be it. They have the microphone. But if people want to look carefully, they will turn up substance."

The Amtrak board chairman said some of his decisions have been difficult and others, such as firing Gunn, have been unpopular, "I wasn't put in this position to pass on decisions because they are unpopular," he said.

The 56-year-old Texas native is a corporate lawyer in Dallas and a major political fundraiser. Friends and colleagues describe him as a competent and thoughtful pragmatist who is battling entrenched interests to place the money-losing Amtrak on sound financial footing.

Bush appointed Laney to the Texas Highway Commission in 1995. When Bush initially ran for president in 2000, Laney quickly raised about $100,000 for the campaign, mainly by soliciting funds from partners in Jenkens & Gilchrist, the big Dallas law firm he managed and where he focused on corporate and business law.

Laney hoped to become the nation's transportation secretary when Bush was elected president, but was passed over. Bush called on Laney in April 2002 to fill a vacancy on the Amtrak board; the board elected him chairman in September 2003.

Meanwhile, the Dallas law firm Laney headed for more than a decade experienced significant growth, and expanded to other cities including Chicago, where partners engaged in a lucrative tax practice that proved controversial.

Laney left Jenkens & Gilchrist in January 2002 to join another Dallas firm, Jackson Walker. Earlier this year, his former partners at Jenkens & Gilchrist agreed to pay $81.6 million to settle lawsuits filed by more than 1,100 wealthy clients who claimed the firm designed tax shelters between 1999 and 2003 that were ruled illegal by the Internal Revenue Service.

Laney said he believed his old firm had good oversight during his time in charge, handled the internal situation involving the tax practice properly, and unfortunately got caught up in changing IRS rules.

Those who know and worked with Laney, a graduate of Stanford University and Southern Methodist University Law School, say he is a fiscally conservative Republican but not a political ideologue.

Steve Wolens, a former Democratic Texas legislator and long-time friend, said Laney is "very practical" and "a problem solver," willing to do what he thinks is right even in the face of criticism.

He said Laney in the past year headed a charter review commission that examined whether Dallas should move from a city manager form of government to a strong mayor system, an issue that aroused heated emotions. Laney favored the strong mayor system, and was "pummeled" by his opponents, Wolens said.

"He took a lot of grief at all those hearings. He is a masochist for civic duty. He seems to be a glutton for punishment," said Wolens, whose wife, Dallas Mayor Laura Miller, appointed Laney to the charter commission.

Tom Till, a former head of the Amtrak Reform Council and now a senior fellow at the Discovery Institute in Seattle, said Laney is trying to make long-overdue improvements in the operations and finances of the national railroad.

"Laney is not breaking up Amtrak," said Till, who supports a drastic overhaul of the system. "This is a management reorganization, not a bunch of political toads trying to carry out nefarious schemes by their friends in the administration."

Others find that hard to believe.

Thomas Downs, a former president of Amtrak, said the Bush administration appears intent on cutting off federal subsidies and dismantling the railroad, and Laney seems to be its man.

"If you are appointed by the president of the United States, your loyalty is to the person who brought you," said Downs. "You don't pick people who are going to do something you don't want them to do."

Menendez said Laney fired Gunn, who had made great strides in improving operations at the railroad; held a secret board meeting to offer a plan to break off the Northeast Corridor from Amtrak operations; and has held private meetings with people interested in buying Northeast Corridor assets -- all without consultation with Congress, behind closed doors and contrary to past public statements.

"I don't trust him," said Menendez.

"Laney can make all the claims he wants," added Lautenberg. "I don't listen to his words as much as I look at his actions."

© 2005 The Star-Ledger. www.nj.com

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