Media Transparency

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Bill Berkowitz
October 29, 2006

Neil Bush's family values

Despite a record of past scams and other controversial business deals, Neil Bush is now benefiting directly from President's Bush's No Child Left Behind Act and his father's international network

Two years ago, when Neil Bush and his mother, the former first lady Barbara Bush, were featured guests at a $1,000-a-table fundraiser for the Western Heights School District in Oklahoma City, proceeds from the event were specifically earmarked for the purchase of products from Neil's company, Ignite! Learning. Late last year, when Neil's mom agreed to make a contribution to a Hurricane Katrina relief foundation for those victims that had relocated to Texas, she stipulated that her donation had to be used by local schools to acquire Ignite products.

It must have been a long time ago that Neil Bush, the son of Bush 41 and the younger brother of Bush 43, discovered that the key to unlocking the entrepreneurial vault was to take full advantage of the Family. While entrepreneurial nepotism is as American as apple pie and Thomas Kinkade paintings, the Bush Family has honed it into a science.

Over the past two decades, while Neil Bush has made impressive amounts of money in all sorts of interesting business deals, he has always seemed like the kid who was caught red-handed throwing chalk at the teacher, got sent to the principal and yet returned to the classroom unscathed.

These days, with the help of the Saudi Royal Family, a former junk bond dealer, a Russian mobster, the Rev. Sum Myung Moon, and mom and dad, family string-pulling is again paying off.

The Los Angeles Times recently reported that Ignite! Learning, a company headed by Neil Bush "and partly owned by his parents is benefiting from Republican connections and federal dollars targeted for economically disadvantaged students under the No Child Left Behind Act."

The company has managed to "place its products in 40 U.S. school districts and now plans to market internationally," the Times reported.

"Interviews and a review of school district documents obtained under the Freedom of Information Act," by the Los Angeles Times, "found that educators and legal experts were sharply divided over whether Ignite's products were worth their cost or qualified under the No Child law."

According to the Times, "Most of Ignite's business has been obtained through sole-source contracts without competitive bidding. Neil Bush has been directly involved in marketing the product."

A story about these developments also appeared in a mid-October issue of BusinessWeek. Headlined "No Bush Left Behind", the magazine reported that "after five years of development and backing by investors like Saudi Prince Alwaleed Bin Talal and onetime junk-bond king Michael R. Milken, Neil Bush aims to roll his high-tech teacher's helpers into classrooms nationwide. He calls them ‘curriculum on wheels,' or COWs. The $3,800 purple plug-and-play computer/projectors display lively videos and cartoons: the XYZ Affair of the late 1790s as operetta, the 1828 Tariff of Abominations as horror flick. The device plays songs that are supposed to aid the memorization of the 22 rivers of Texas or other facts that might crop up in state tests of ‘essential knowledge.'

"Bush's Ignite! Inc. has sold 1,700 COWs since 2005, mainly in Texas, where Bush lives and his brother was once governor. In August, Houston's school board authorized expenditures of up to $200,000 for COWs. The company expects 2006 revenue of $5 million. Says Bush about the impact of his name: ‘I'm not saying it hasn't opened any doors. It may have helped with some sales.' (In September, the U.S. Education Dept.'s inspector general accused the agency of improperly favoring at least five publishers, including The McGraw-Hill Companies, which owns BusinessWeek. A company spokesman says: ‘Our reading programs have been successful in advancing student achievement for decades; that's why educators hold them in such high regard.')"

According to the Los Angeles Times, "The law provides federal funds to help school districts better serve disadvantaged students and improve their performance, especially in reading and math." However, Bush's company "does not offer reading instruction, and its math program will not be available until next year."

Unfortunately, the Department of Education "does not monitor individual school district expenditures under the No Child program, but sets guidelines that the states are expected to enforce, spokesman Chad Colby said."

Ignite executive Tom Deliganis admitted that "some districts seem to feel OK" about using No Child money for the Ignite purchases, "and others do not."

BusinessWeek also pointed out that the Washington Times Foundation, "A foundation linked to the controversial Reverend Sun Myung Moon has donated $1 million for a COWs research project in Washington (D.C.)-area schools. In 2004 a Shanghai chip company agreed to give Bush stock then valued at $2 million for showing up at board meetings. (Bush says he received one-fifth of the shares.) In 1988 a Colorado savings and loan failed while he served on its board, making him a prominent symbol of the S&L scandal. Neil calls himself ‘the most politically damaged of the [Bush] brothers.'"

The Rev. Moon, Saudi Prince Alwaleed Bin Talal and Milken aren't the only controversial financial participants. Fugitive Russian billionaire Boris Berezovsky, who has been accused of having strong tries to the Chechen mafia, has been an investor in Bush's Ignite! project since at least 2003.

And then, there's mom and dad. The former first lady got herself in a bit of hot water when she contributed to a Hurricane Katrina relief foundation for storm victims who had relocated to Texas. However, she stipulated that her donation had to be used by local schools for purchases of COWs.

"In January 2004," according to the Los Angeles Times, Neil and his mom "were guests of honor at a $1,000-a-table fundraiser in Oklahoma City organized by a foundation supporting the Western Heights School District. Proceeds were earmarked for the purchase of Ignite products."

While Mary Blankenship Pointer, the organizer of the event "said she planned the event because district students were ‘utilizing Ignite courseware and experiencing great results [and].our students were thriving,' ... Western Heights school Supt. Joe Kitchens said the district eventually dropped ... Ignite because it disagreed with changes Ignite had made in its products. ‘Our interest waned in it,' he said."

In addition to investors and high-powered international connections, Bush Family ties have provided the sometimes star-crossed Neil with an always accessible escape route from responsibility. Escape from prison was the operative term in 1988, when as a director of the Denver, Colorado-based Silverado Savings and Loan Association Bush presided over a monumental scam that actually cost taxpayers something north of $1 billion. A Resolution Trust Corporation suit against Bush and other officers of Silverado was settled in 1991 -- during the time his father was president -- for $26.5 million. Bush was fined $50,000 and banned from future banking activities.

He managed, however, to avoid going to the hoosegow. Instead, he left the state for the greener pastures of Texas, and the opportunity to get back on the entrepreneurial horse.

It would no doubt be difficult, even for the notoriously loyal Bush Family, to find anyone not concerned by Neil's numerous character flaws; blemishes that oozed into the public domain when Neil decided to divorce his wife of 23 years, Sharon Bush. The story goes that Neil, in one of the more fetid "You've Got Mail" moments in recent years, informed Sharon of his intentions in an e-mail.

The Bush's divorce threatened to spill over into a tell-all book by his former wife because Neil was being downright tightfisted with the financials. He ultimately loosened his purse-strings and Sharon's book was shelved.

Nevertheless, the public's right-to-know was advanced -- although some might argue that it was set back -- when it was revealed in Bush's deposition that during numerous business trips to Asia, Neil was a serial recipient of late-night visits by anonymous prostitutes; assignations that he apparently didn't have to pay for.

In a post dated October 6, Wonkette pointed to several of Neil Bush's unusual business assignations:

On January 2, 2004, the Associated Press reported, in a story headlined "Neil Bush makes one-day profit over $170,000", that Neil Bush "made at least $798,218 on three stock trades in [the Kopin Corp. of Taunton, Massachusetts] a small U.S. high-tech company where he had been a consultant, according to his tax returns, including $171,370 buying and selling the company's shares in a single day."

AP pointed out that "Unlike the ordinary investor who buys at the market price...Bush benefited from the fact that his stock purchase costs in some cases were minimal because he got a bargain, paying $13 a share when he exercised stock options that were part of his consulting compensation from Kopin. The company's stock price was selling for many times that amount during much of the time Bush was trading. The company granted him 20,000 stock options."

In an e-mail responding to the Los Angeles Times story, Bush said that Ignite's program had improved the test scores of economically disadvantaged children and he denied that his family's political connections helped grow the company.

"As our business matures in the USA we have plans to expand overseas and to work with many distinguished individuals in Asia, Europe, the Middle East and Africa," he wrote. "Not one of these associates by the way has ever asked for any access to either of my political brothers, not one White House tour, not one autographed photo, and not one Lincoln bedroom overnight stay."

He also characterized the Times' piece as "entirely political."