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THE
DAILY WHOPPER
The
Dog Ate My Homework
January
19, 2002
by Jeremiah Bourque
Practically no six hour period passes anymore without a report
coming out about "The Next Enron." Translated from lingo into
English, this is to say, "The Next Big Stock Market Fraud
Supported By Fraudulent Accounting."
What are we to make of one of the Big Five accounting firms
actively shredding documents, finding an Oct. 12 memo that
clearly states that this is what supervisors wanted and required?
Even a two-bit accountant fears audits and will not throw
away papers, let alone if there is interest in a particular
individual for tax purposes or the like. Knowing that Enron
was in trouble, indeed, with the proof right before their
eyes, and with the full knowledge that not only the SEC, but
other organizations, were interested in those documents, they
shredded and erased anyway.
For some reason that escapes me, there are people who still
trust corporations blindly.
As the title suggests, this article is about the Bart Simpson,
"I didn't do it," craze in conservative thought on the issue
of Enron. The collapse is simply not seen as an individual
failure. Indeed, the engineers of Enron's collapse are seen
as wise, aggressive investors who cashed in when they could,
beating the rush as wise men can. There is no contemplation
of the idea of using insider knowlede to do this. Rather,
the collapse of this once-great corporation was, and is, due
entirely to outside factors, in particular, the incompetence
of the Clinton administration in governing the economy, the
mistakes made by Alan Greenspan, and the dynamics of the free
market, which are above the power of any man to control (save
by brute force and this is evil incarnate).
Thus, in this view, Enron's collapse is seen as a sort of
karmic inevitability, a sacrifice on the altar of the genius
of market capitalism, not so much a human failing as a twist
of fate. This strongly smacks of Calvinist predestination.
For that reason alone, I am very disappointed to see such
logic used by the Wall Street Journal, among others.
To quote a certain Lieberman, "This was not a natural death."
It has occured to me that Republicans like O'Neill, our beleaguered
treasury secretary who tends to be much maligned on Wall Street
now that he gets to open his mouth more instead of hide behind
PR spokesmen at Alcoa, know that there are laws against the
use of insider information, laws that date back to the 19th
century. They cannot, however, understand exactly why this
is so.
In the mind of the elite Republican, the problems at Enron
were known long before the stock market collapse. This is
because of two reasons.
First, God, knowing all, knew that Enron had accounting problems.
This, it is wrong to say that no one knew about them; God
did.
Second, the collective consciousness of the market place,
by definition, knew. This is because the market represents
the sum of all human knowledge concerning all financial things.
Thus, the market knew about the problems, to the extent that
any collective consciousness short of God could. Therefore,
it is wrong to say no one knew about the problems; the market
did. It had to have. There is no other option.
Thus, between God, and the marketplace, which in the minds
of a believer, are two separate things, Enron's problems were
neither mysterious nor odd. The genius of the marketplace,
and God's divine plan, made it possible for those who owned
Enron stock to know the maximum that anyone could possibly
know. They simply chose to ignore the signs, whereas insiders
chose to sell stock, the selling of which was not secret.
Consequently, what's the problem? This is how the system
works. Suck it up.
As I said, this is clearly Calvinist predestination at work.
Braggarts who arrogantly pushed their Enron stock as signs
of personal virtue (ala Rand) now are financially hurt, but
if not they, then at least their intellectual brothers and
cousins, admonish that this is the way things are meant to
be. No human can change the workings of the market; it is
foolish to try. Bad companies will be weeded out by the marketplace.
There is no place whatsoever for the government. Period.
Surely the so-called robber barons would wholeheartedly agree.
After all, what is the underlying purpose of the SEC (currently
under hostile takeover by the accounting industry), financial
disclosure laws, public audits, and enforceable codes of ethics?
The purpose, of course, is to protect the little guy from
being impoverished by the abuse of insider information, to
be blindsided by information that ought to have been in the
market.
To the elite Republican, such a concept is simply wrong.
Why should the little guy be protected? He should be as naked
and unprotected as rich investors are, willing to take his
lumps, sink or swim, and above all, diversify. If anything
goes wrong, it's his own fault! It's his money, and no one
but the Lord has any control over what the outcome is besides
himself.
Don't blame wiser, more aggressive, richer, better men for
getting out first. The likes of Kenneth Lay are living the
American Dream, courting failure and therefore, most of the
time, being successful. They are proven winners, enjoying
success wherever they go, showing their shrewdness in all
things. How dare the government presume to even inconvenience
these men! Protecting the weak at the expense of the strong
weakens society, economically as well as socially. Protections
written by the government to shackle corporations from being
aggressive, innovative, and to take success or failure on
their own shoulders and that of their freely, and of their
own will, risk-taking investors, ultimately ruin economic
prosperity. So why should they even exist?
Consequently, these Republicans find very little reason to
try to enforce laws relating to fraud, embezzlement, falsifying
financial statements, destroying evidence, obstruction of
justice, and violation of fidicuary duty. When it's about
sex, it's an outrage. When it's money, it's just business.
This attitude is being reflected far and why across the conservative
mainstream, permeating every sanctomonious declaration of
Clinton or Ann Richards or the liberal media or Alan Greenspan
deserving the blame for the Enron debacle. Market forces,
government forces, media forces, legal forces, chance... all
are being blamed first. Since to the conservative, these are
all credible, there is no forcing to look at the very last
item on the list, which, if all others are discounted, must
be responsible: Enron itself.
Though obviously influenced by religion, there is also a
fair bit of the temporal tendency to defend the wealthy by
knee-jerk reaction, since, according to ideology, they must
be the superior men, and, consequently, ought not be condemned
by society, nor persecuted for simply trying to make money,
which is a much higher goal than that which regulators can
ever strive for. In the end, there is simply a refusal to
lay blame where blame belongs, and to recognize that there
is, truly, such a thing as financial fraud, and that it is
bad.
It's hard to expect any better from these "conservative"
writers anymore. For them, the dog is not eating the homework.
The dog is writing it.
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