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.
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 farther 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.
Bush has received more than $550,000 from Enron, its employees and their relatives during his political career — the most from any source. Altogether, more than 250 members of Congress from both parties have received Enron contributions.
Lay's relationship with the Bush family dates back to when the president's father was the only Bush in national politics.
Lay was co-chairman of former President Bush's 1990 economic summit for industrialized nations, which was held in Houston.
Lay and his wife, Linda, dined on hickory grilled veal medallions and Texas peaches and cream with summit attendees who included British Prime Minister Margaret Thatcher and French President Francois Mitterrand.
Lay also was co-chairman of the host committee for the Republican National Convention when it was held in Houston in 1992. George W. Bush played an active role in his father's unsuccessful campaign for a second term that year.
The businessman had Democratic connections as well, serving Democratic Gov. Ann Richards as leader of her business council. He gave money to her campaign and Bush's in 1994, and when Bush defeated her that year, the new governor kept Lay on the business council.
As Lay was donating money to Bush's 1994 and 1998 governor's campaigns, he also was lobbying legislators to deregulate the electric industry, an area into which Enron was expanding.
Bush signed a deregulation law in 1999 clearing Enron's path into new markets.
"Bush has always delivered on Kenneth Lay's political pitches," said Craig McDonald, director of Texans for Public Justice, a campaign-finance advocacy group.
Even if Bush's dad hadn't been in the White House, the two men would have been on similar trajectories.
"They're both from the energy business; they both like baseball," said W.J. "Jack" Bowen, a retired gas executive who hired Lay twice, at a Florida energy company and then at Transco Energy Co. in Houston.
They have similar personal traits, said Miller, who has watched Texas politics for years. Both are bright and down-to-earth. Each tends to delegate authority.
"Neither one of them pretends to be an intellectual," Miller said. "Lay is reserved but not shy. Bush has got more hambone in him."