After Bush's election, his friendship with Lay led to widespread speculation that the Enron chairman would be tapped to head the Department of Energy. Instead, Lay has served as Bush's key advisor on energy policy. In recent months, sources say, Lay supported the president's decision not to intervene in California's energy crisis, even though the emergency was created in part by industry deregulation. The crisis is certainly proving to be a windfall for Enron, which is among the state's main suppliers of power. In the fourth quarter last year, as energy prices in California soared, the company's revenues tripled from a year earlier, and profits jumped by 34 percent.

Although Enron holds particular influence in the fledgling Bush administration, it is accustomed to wielding clout on Capitol Hill. In 1992, Enron hired former Secretary of State James Baker to hustle contracts for the company in Kuwait, according to a report by Texans for Public Justice. In 1995, Mozambique's natural resources minister told the Houston Chronicle that U.S. officials made "outright threats to withhold development funds" unless he granted Enron a pipeline contract. That same year, Clinton administration officials lobbied heavily for Enron to win a $2.8 billion contract for a power plant in India.

But the past influence pales in comparison to the current political debt that President Bush owes Enron. Lay signed on early as a Bush Pioneer, committing to raise at least $100,000 for the campaign. Enron reportedly put its corporate jets at the disposal of the Bush campaign eight times last year, and Lay and his company also kicked in $300,000 to underwrite Bush's inauguration.