Smoking Gun in Enrongate
Enron: The Smartest Guys in the Room
Wed Jul 5, 2006 17:51


Enron: The Smartest Guys in the Room


One explicit and powerful theme in "The Smartest Guys in the Room" is expressly articulated and repeated for emphasis: this is the story of people, not arcane financial accounting methods or numbers, and because it is people, it can happen again. Enron is just the manifestation of the evil begotten by hubris, in spectacularly public fashion. It is classic Greek tragedy, and it is one from which its chief protagonists, Ken Lay and Jeff Skilling, must not escape.

Yes, it is a movie with a point of view, but this is not a Michael Moore documentary. Director Alex Gibney brilliantly tells the story simply by interviewing people who were participants in the events, showing the time lines of those events, and interweaving an astonishing amount of video and audio footage taped at Enron, by Enron itself. The movie resolved for me the question: "What did they know, and when did they know it?" They knew. They not only knew; they designed the company to be the ultimate shell game, with no pea. The only thing Enron ever had to sell was its stock price. And they did know that was their only product.

As a Houstonian, I admit that I, a supposedly sophisticated business professional, was intimidated by Enron's assertion in its glory days that the reason I didn't understand its business was just that I wasn't smart enough. My friends, managers and lawyers, some from Harvard thenselves, also admit to the same intimidation. It was not that the questions were not being asked; it was just that we were silenced when Enron vowed that they were the smartest guys in the room. They asserted it, and we believed them. Thank good Fortune that one reporter, Bethany McLean, in almost too soft a voice to be credible as a giant killer, kept asking.

I wish this movie might inspire a larger remedy than the one being attempted by the Department of Justice. Why doesn't Harvard deny admission to people like Jeff Skilling, who, when questioned in his entrance interview whether he was smart, replied, "I'm (expletive deleted) smart"? Why isn't some humility and modesty still ranked a virtue? Why do we celebrate the rise of the specialist educated only in his field, and wholly ignorant of the inevitability of the fall of the Greek protagonist who becomes blinded by arrogance, power, greed---- in short, hubris? Why is ethics a specialty study, instead of integral to every field of study? I sat open-mouthed as the tape showed Jeff Skilling seriously selling a new business idea: selling futures in the weather. He parodied himself on tape: he had a new, better idea than the "mark to market" booking which allowed Enron to book future theoretical profits once they had signed a deal; now he would institute "hypothetical to book", booking profits as soon as he had an idea. What, ultimately, was the difference between the parody and the reality? The horror of listening to traders, who sat in a room directly below Ken Lay and Jeff Skilling, with staircases between their executive offices and the trading floor, laughing at the misery they were inflicting on California as they extorted profits from that misery, leaves me outraged long after the movie is over. They threatened and may have cost lives with their fraudulent tactics. They admit it on tape, laughing. They knew. It was their business plan. To make Andrew Fastow the scapegoat for what Enron was developing as its business plan before he was ever hired is simply the continuation of the shell game with no pea. Look for the "designated fall guy". They still think they are the smartest guys in the room.

No, I'll never be selected for the jury pool now, but I wouldn't have been anyway. I'll buy the DVD and watch it a few times during the trials and seethe, lest I forget. Excellent movie, the best kind of documentary.


Enron: The Smartest Guys in the Room - Wikipedia, the free ...
Enron: The Smartest Guys in the Room. Movie poster for Enron The Smartest Guys in the Room. Directed by, Alex Gibney. Produced by, Alex Gibney ...



Smoking Gun in Enrongate - Let the impeachment begin?

Smoking Gun in Enrongate - Let the impeachment begin?
Sun Jan 27 21:01:02 2002

Smoking Gun in Enrongate - Let the impeachment begin?
By : Mike Hersh - 01/24/02

Former Federal Energy Regulatory Commission Chairman Curtis Hebert, Jr. is going
public with explosive allegations. Hebert says Enron CEO Ken Lay--the largest
contributor to George Walker Bush--made improper demands.

When Lay threatened that his close friend Bush, would fire Hebert unless he obeyed,
Hebert refused. Lay ordered Bush to fire Hebert, and Bush complied in August 2001.
Hebert has been on record about all of this for months, but he recently made a new,
even more explosive charge. Hebert says Bush also let Lay INTERVIEW him and
other candidates for FERC Chairman in the first place!

In a nutshell: Enron gave Bush $millions to sponsor his rise from a losing Candidate
for the US House to the "leader of the free world." In return, Bush gave Enron "hire
and fire" authority over the FERC, and performed other favors in return for money.
This directly and personally ties Bush to the Enrongate scandal in all its illegality.

Bush betrayed his oath to the American people when he let Ken Lay hand pick
regulatory watchdogs we entrusted to prevent the massive meltdown that cost
Americans $billions. This makes letting the fox guard the hen house look like
tender loving fiduciary care.

This is nothing new for Bush, who fired Texas Funeral Service Commission (TFSC)
director Eliza May in retaliation for her investigations of Service Corporation
International and its CEO Robert Waltrip. Waltrip--like Enron's Lay--is a longtime
Bush patron.

Bush lied under oath regarding this political quid-pro-quo, then he and SCI settled a
lawsuit to keep May quiet. Texas taxpayers picked up $155,000 of the hush money
tab, while SCI paid May the other $55,000, according to a Dallas Morning News
story published 11/09/2001. Texans know this scandal as "Funeralgate."

The Rule of Law requires that Bush testify under oath about Funeralgate, his and
his Brother John Ellis Bush's Votergate activities during the 2000 election in Florida,
and Enrongate. We already know George Walker Bush has an established pattern
of helping his friends and backers evade regulation and possibly even criminal

We must demand action now, because Enron and its accountants at Anderson have
been destroying evidence by the box-load. We must know what Bush did, and why
he did it.

Enrongate is not just a Bush scandal: this is a Republican scandal. Other top GOP
officials like VP Dick Cheney, White House advisor Karl Rove, House Leader Dick
Armey and Sen. Phil Gramm also helped Enron plunder and evade regulation.
They helped Enron rip off consumers, investors and employees.

Ignore Republican and media efforts to spin this as a business scandal or a bipartisan
scandal. This is not about the generous, but legal contributions Enron made: 73% to
Republicans, 27% to Democrats. This is a GOP political scandal because Republicans
helped Enron pay no taxes in four out of five years, while hiding profits in offshore
accounts. Despite the hype, no Democrat did anything of the sort.

Even with all these special favors, golden boy Ken Lay ran Enron into the ground.
Adding insult to injury, if not perfidy to perjury, the Republican "stimulus porkage"
aims to give Enron and Lay even MORE of your tax money.

This Republican scandal exposes GOP corruption at the highest levels, but more
profoundly, it reveals the bankruptcy of the GOP "government is the problem"
ideology. It blows the lid off Bush's Enronomics, and his plan to Enronitize Social
Security, energy and other policies.

I am currently working on another article concerning these fundamental failures in
Republican philosophy. For now, back to the immediate scandal. Already, Armey
and Gramm are quitting politics to escape Enrongate, but ending their careers to
enjoy tax-paid pensions may not be enough to satisfy justice and the Rule of Law.

These top Republicans--all outspoken critics of President Clinton's conduct in
office--should welcome full-scale investigations into their own apparent influence
pedaling. As should House Whip Tom DeLay, VP Cheney, George Walker
Bush, and other GOP leaders. As should Ken Lay, Sen. Gramm's wife
Wendy--a former regulator turned Enron board member.

If they broke the law, they should pay the penalty. That's been the Republican
mantra for nearly a decade. Let them prove they meant it by volunteering to testify
before the US Senate--under oath, on national television. If they're innocent, what
do they have to fear? They should welcome the opportunity to come clean or set t
he record straight.

Despite their nonstop pontificating about others' lacking accountability, I'm not
confident these Republicans will step up and do the right thing. We must take it
upon ourselves to demand justice and uphold the Rule of Law. Call the media and
your elected officials NOW to make sure they understand the real issues in
Enrongate, Funeralgate, and Votergate.

Let the investigations, perhaps even impeachment begin!

Mike Hersh is a contributing writer for Liberal Slant

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