American Notes BANKRUPTCIES

Bankruptcies in the depressed Energy Belt are almost as common as ten-gallon hats, but the Texan who filed papers last week was no ordinary sad case: John Connally, 70, former Treasury Secretary, three-term Texas Governor and onetime presidential candidate. Connally applied under Chapter 11 for personal bankruptcy protection and under Chapter 7 to liquidate the failed real estate business he owned with Partner Ben Barnes, a former Lieutenant Governor. Between them, they owe an estimated $170 million.

After failing to get the 1980 Republican presidential nomination, Connally went home to make a Texas-size fortune. Starting with about $10 million, he and Barnes built a real estate empire worth an estimated $300 million by 1983. But the oil bust sent the value of the partners' holdings into a free fall. Over the past year Connally tried to prop up the business by selling personal assets, including 126 prized Thoroughbreds and quarter horses that he reluctantly auctioned off for nearly $400,000.