ENRON: "Evildoers in the heart of America"
Margaret Wente's columns in Canada's Globe and Mail always trigger debate,
but very rarely does she come down critically on the USA. In a refreshing
change, last week she matched the words 'evil' coming out of the White House
with her own phrase "Evildoers in the heart of America."
The question is this. Will ENRON now be listed in the new 'Axis of Evil?'
Read and reflect.
Tuesday, January 29, 2002
Evildoers in the heart of America
By MARGARET WENTE
The Globe and Mail
At the very heart of the American establishment is a dangerous cabal of men.
They are certain they're doing God's work, and contemptuous of anyone who
dares to question them. But history will judge them differently. These are
ruthless men who have inflicted carnage on thousands of helpless people. The
real story is the damage done by their arrogance, duplicity and insatiable
lust for world domination, even as the gullible media cheered them on.
No, I'm not referring to the Bush administration. I mean Enron.
The people who are invariably appalled at wretched American excesses and
twisted American values have been pointing at the wrong evildoers. To their
dismay, the campaign against terror has been progressing very nicely.
Meantime, the biggest disaster in American business history has been spewing
out enough slime to coat every capitalist in sight.
In case you haven't followed all the Enron news, here's the latest: The
former vice-chairman blew his brains out with a .38. Enron's chief auditor,
a clean-cut accountant from Arthur Andersen, was hauled before Congress and
took the Fifth. And Enron chairman Ken Lay was booted out the door by the
bankrupt company's creditors.
"I believe in God and I believe in free markets," Mr. Lay, a Baptist
preacher's son, once said. He preached that Enron was more than just another
business. It was the business that was redefining global capitalism.
Enron billed itself as a New Economy company that had learned the secret of
trading everything. It started with natural gas and electricity, then
branched out to weather futures and broadband. Pretty soon, it had revenue
of $100-billion. Nobody could explain how it made its money. But Enron's
executives, who all had PhDs, said it was easy to understand so long as you
were as smart as they were, which, of course, you weren't.
For six consecutive years, Fortune magazine readers voted Enron the most
innovative company in the United States. The New York Times said it was "a
model for the new American workplace." Both these claims were true, in their
way. Enron cooked the books so innovatively that it was able to hide
billions in losses and manufacture lots of fake profits, thus pushing its
stock price into the stratosphere. Meantime, the CEO of this model employer
issued edicts such as: "You must cut jobs ruthlessly by 50 per cent or 60
per cent. Depopulate. Get rid of people. They gum up the works."
A few people really did get rich from Enron. One was the chief financial
officer, who ran numerous secret and lucrative side deals. One was the CEO,
who quit last August citing "personal reasons." Another was the chairman,
Mr. Lay. They cashed in millions of dollars worth of stock options, even as
their employees were ordered to buy the company's stock through their
retirement savings plans. When the company went down, thousands lost not
only their jobs but their life savings.
"Talk up the stock and talk positively about Enron to your family and
friends," Mr. Lay told his employees in September. "The company is
fundamentally sound." That was shortly after an Enron executive wrote him a
memo saying: "I am incredibly nervous we will implode in a wave of
Today, Enron's rotting carcass is being poked by 248 members of Congress,
212 of whom benefited from its largesse. Much is being made of Enron's
intimate connections to the Republican White House. But Enron was an
equal-opportunity benefactor -- it tried to buy the good opinion of
absolutely everyone. It even signed up leading pundits for "advisory
services." They included economist Paul Krugman, who made his reputation
denouncing the Bush administration and the American cult of greed on the
op-ed page of The New York Times. Mr. Krugman's retainer was $50,000.
Even the Greens were in Enron's pocket, because it was a major backer of the
Kyoto pact on global warming. Enron talked a lot about how good Kyoto would
be for the environment. But, mainly, Kyoto would be good for Enron, because
it thought it could make enormous profits trading energy-emissions credits.
Enron's collapse is a total systems failure. All the watchdogs were asleep,
or got caught up in the greed machine. The auditors who were supposed to
police it were in its pocket. The analysts who hyped it proved (yet again)
that they're nothing more than captive shills. And the notion that ordinary
workers can trust the stock market with their retirement funds has been
debunked. The system did not enrich the workers. It betrayed them.
Enron was the last blast of the go-go, get-rich, greed-soaked '90s. The idea
that a bunch of powerful, aggressive men could rewrite the fundamental rules
of business turned out to be, quite literally, an enormous fraud.
There are lots of villains in America. You just need to know where to look.