posted on February 2, 2002 11:01:56 AM new
If this whole Enron mess doesn't create a few more Democrats, this country's voters are totally hopeless. Read this and weep!
February 2, 2002
State of the Enron
By FRANK RICH
had just finished crying over the tragic news that President Bush's mother-in-law had lost
$8,000 on her Enron stock when another heartbreaking story sent me reaching once more
for the Kleenex. There on the "Today" show this week was the sobbing figure of Linda Lay,
Ken's wife, telling America the most rending tale of dispossession since the Yankees stole Tara
from Scarlett O'Hara.
"Other than the home we live in, everything we own is for sale," said Mrs. Lay. "There's nothing
left." Given that her husband has received some $200 million in compensation from Enron since
1999, and that he (as she explained) was kept in the dark about his own company's shell
games, the message was clear: The Lays are the biggest victims of the entire scandal, bigger
victims by far than those grandstanding employees who complain of having lost pensions in the
piddling five, six or seven figures.
As if the Lays' predicament is not upsetting enough, the "Today" show left us wondering if the
second-biggest victim of Enron's collapse may be the Holocaust Museum Houston, whose
representative came on- screen along with various clergy and Lay offspring to testify to the
family's beneficence. If the Lays are broke, you had to ask, is it only a matter of time before the
Holocaust is consigned to the Houston memory hole along with the Astrodome?
I'd still be weeping as copiously as Linda Lay had I not subsequently read in The Wall Street
Journal that she and her husband still owned 18 properties in Texas and Colorado, only two of
which are up for sale, and that Ken Lay still owned $10 million in non-Enron stocks.
Thankfully, others are lending emotional support to the couple in my stead. After ministering to
Mr. Lay, Jesse Jackson likened him to Job.
Linda Lay's "Today" performance was coached by a freelancing alum of Hill & Knowlton, the
wonderful p.r. folks who have made Americans fall in love with such past clients as the
Tobacco Institute, the Teamsters and the Church of Scientology. Perhaps Mrs. Lay hoped she
might rev up the nation's sympathy for her man, who rolls out his hear- no-evil, see-no-evil,
speak-no-evil defense when testifying before Congress on Monday. But what lingers instead is
her colossal arrogance. Just as Ken Lay misled his own employees about the sinking financial
health of his company, imploring them to buy more stock while dumping his own, so Linda Lay
takes us all for dupes, ready to be sold another bill of goods while she and hubby plot their next
escape to Aspen. She didn't even identify which of the Lay sons was the target of a criminal
investigation for bankruptcy fraud and embezzlement.
This is why Enron may be as much a cultural scandal as it is a business and political scandal. It
is, as one friend puts it, as if a window had opened and revealed the way it all really works.
What we see is a world in which insiders get to play by one set of rules — entree to Enron side
partnerships that could turn minimal investments into millions overnight — while the
unconnected and uninitiated pick up the bill. And it isn't necessarily illegal. All manner of
creative accounting schemes took root in the corporate loophole land that was protected from
reform in the 90's by such inquisitors-come- lately as Joseph Lieberman and Billy Tauzin, both
recipients of accounting-industry largess. It's going to be easier for the Feds to nail mid-level
scapegoats, especially those operating shredding machines, than to prove that a Ken Lay or
Jeffrey Skilling had felonious intent.
Nor is this culture limited to one party or one company. Terry McAuliffe, the Democrats'
chairman, has called Enron "simply outrageous" and declared that his "heart goes out to the
employees and shareholders who were victimized by a web of greed and deceit." Now we
learn that he parlayed a ground-floor $100,000 investment in the Bermuda-based, Beverly
Hills-situated telecom company Global Crossing into $18 million and cashed out well before
Global Crossing went belly-up this week, after having never turned a single yearly profit. We
are to believe it is Mr. McAuliffe's business acumen that landed him on that ground floor in the
first place, not the buddy network he cultivated as chief fund-raiser to his president, Bill
Clinton. "If you don't like capitalism," said Mr. McAuliffe in defense of his windfall, "move to
Cuba or China."
I wonder if Mr. McAuliffe's heart goes out to a schoolteacher who, having lost more than
$120,000 in Global Crossing, told The Times this week, "I don't know how the management of
this company did so well while small shareholders did so poorly." Gary Winnick, Global
Crossing's chairman and a Clinton- McAuliffe golf partner, walked away with $730 million.
Perhaps that benighted teacher should go back to school and study the bipartisan gospel of
both Mr. McAuliffe and our Treasury secretary, Paul O'Neill, who has cited Enron's swift rise
and fall as a natural phenomenon "of the genius of capitalism." Under their tutelage, she would
learn how Thomas White, the Bush administration's secretary of the Army, could legally exit
with more than $10 million of proceeds from an Enron division that, according to his
colleagues, overstated its profits by hundreds of millions on Mr. White's watch (he was vice
chairman) and has since tossed overboard most of its employees.
President Bush believes that his impressive stewardship of the war will make these stories go
away, and so he chose not to mention the word Enron during his State of the Union address.
But the country gets the picture now, and the more Dick Cheney tries to defend the secrecy of
his energy policy task force, the more he sounds as arrogant and disingenuous as Linda Lay.
No less an authority than John Dean has declared of Mr. Cheney's stonewalling that "not since
Richard Nixon stiffed the Congress during Watergate has a White House so openly, and
arrogantly, defied Congress's investigative authority."
For all the vice president's lofty talk of the principle of executive branch confidentiality, The
Times's Don Van Natta reports that the administration had no qualms about releasing an
avalanche of records from the Clinton White House. Mr. Cheney has even violated his
sacrosanct principle of confidentiality about his own meetings when it suits him politically. As
The Los Angeles Times reported last August, the task force did depart from its pledge of
secrecy once, when officials paraded a group of renewable-energy experts before White
House reporters after their meeting with Mr. Cheney. How cynical can you get? That show
meeting took place on the day before the energy plan was sent to President Bush. In reality,
environmentalists had about as much serious access to the secret deliberations over Bush
energy policy as common stockholders did to the secret partnerships at Enron.
Since we already know that Enron did have repeated meetings with the Cheney task force,
what is he covering up? Logic dictates there must be some bombshells among the non-Enron
names, starting with any from the vice president's former (and now imperiled) employer,
Halliburton. Equally revealing are the names of those he rebuffed. This week Dianne Feinstein,
the senior senator from California, revealed that her three requests to meet personally with
either the president or the vice president during her state's energy crisis were denied even as the
administration greeted Enron executives bearing wish lists.
Like Linda Lay, the Bush administration asks that we take its ethical purity on faith. In
defending the energy task force, Ari Fleischer went so far this week as to invoke the founding
fathers on behalf of clandestine administration dealings with oil company executives. "The very
document that protects our liberties more than anything else, the Constitution, was, of course,
drafted in total secrecy," he said. Never mind that the names of those drafters, unlike the
modern-day patriots meeting with Mr. Cheney, were not kept secret. These days freedom's
just another word for nothing left for Enron shareholders to lose.
POSTSCRIPT: After my previous column, Mr. Fleischer called me to say that I had been
unfair to Lawrence Lindsey, the administration's chief economic adviser, when I wrote that
during a Jan. 12 appearance on CNN he had not mentioned overseeing an October
administration review of the impact of Enron's travails. Mr. Fleischer says that Mr. Lindsey was
doing exactly that when he spoke on CNN of his staff "monitoring the energy markets." I guess
I didn't notice because I was too busy wondering why Mr. Lindsey, a $50,000-a-year Enron
adviser as recently as 2000, would have been connected to any such review.
posted on February 2, 2002 12:14:10 PM new
Great story, Adele!
Surely there will be an investigation of this scandal. It's strange that everything is just being covered up. When Lay's wife was interviewed on NBC, she was not asked to clarify anything...such as what happened to the 400 million. She just sat there and cried, saying that the money was all gone.
This is another good story about Bush. Of course he didn't mention Enron in his state of the union address. He didn't mention Osama bin Laden either and the war has become a conquest for power and oil.
by Robert Scheer
Let Down His Rich Pals? Over His Dead Body
Talk about the politics of class struggle. George W. Bush now is apparently willing to give his life to make the rich richer. "Over my dead body" was his response to proposals to scale back the $1.35 trillion in tax cuts planned for the next ten years.
Notice that he didn't say "over my dead body" will the homeless--many of them actually employed in low-paying jobs--sleep in the snows of Minneapolis because the "faith-based" as well as government shelters are short on funds. Nor is it "over my dead body" that Enron workers will be left holding the bag emptied by the President's good friend, Kenneth L. "Kenny Boy" Lay. Nor is it "over my dead body" that the Boeing company will be given a $22 billion Air Force contract as it fires thousands of its workers. The President cannot say that "over my dead body" will he forget his pledge to assist seniors with prescription medical costs, save Social Security and revive public education, when in fact his tax cut has made it impossible to deliver on any such promises.
Nope, his is the manifesto of a true son of the super rich who has never known a nanosecond of economic insecurity and genuinely believes that the truly burdened are those with enormous wealth. The truly needy in the Bush lexicon are the very wealthy folks who must be given tax breaks so they may more easily invest in the economy. The rest of us are told it is our patriotic duty to buy things we cannot afford, but the rich can only be expected to invest if it does not cost them anything in after-tax dollars.
With blasé arrogance, the President now insists that his skewed tax cut be amplified in the years to come. This is a cheerleader who doesn't know the game is lost: Unemployment is at a decade high, the huge Clinton budget surplus is now going into deficit, and eight years of buoyant prosperity and growth have been turned into a sour recession.
The fact that none of this gives President Bush pause is the purest indication that he does not, in the least, grasp the suffering engendered by his policies.
It does not have to be this way. The rich can indeed "get it," as Franklin Delano Roosevelt and many other wealthy American leaders have demonstrated. However, it does take a bit of work to wedge one's feet into the pinched shoes of the less fortunate--work that the President (like his father before him) has not been inspired to perform.
Perhaps if the media and the Democrats had challenged Bush's nostrums more forthrightly he could have moved beyond the ingrained smugness of a rich brat.
That did not happen, however, and instead the failure of this administration's economic policies has been ignored, particularly in the aftermath of September 11. Indeed, that tragedy is turned to the most shameful of partisan political purpose to explain away a recession that began in earnest in March, half a year before the terrorist attack.
It is Bush and not Osama bin Laden who is responsible for subverting the fiscally conservative policies of the Clinton years. A true conservative would say that "over my dead body" would the government siphon the surplus created by Social Security taxes to the pockets of the rich, putting the nation further into the red.
Bush may be the hero of the moment but it won't be so when future generations try to collect their Social Security checks. If Bush keeps it up he will be remembered as another Herbert Hoover, a President who let the unemployment lines grow while the government went broke catering to the wealthy.
posted on February 2, 2002 04:38:16 PM new
You know, it always surprizes me when I hear the Rich talking about how "terrible" it was for the French peasants to behead the nobility of France during their revolutions. After reading the history of the oppression of the peasants, I do not feel sorry for them, nor for the Russian nobility that got their comeuppance up against a wall in the Russian revolution. That Tyranny can piss people off to the point where they blame the Rich and Powerful never ceases to amaze the current crop of Rich and Powerful, who believe that it could never happen to them ...
Borillar
"Friends don't let friends vote republican"
