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The
Enron Lies Are Piling Up
February
12, 2002
by William Rivers Pitt
Former Enron CEO Jeffrey Skilling stepped into the maw of
the Capitol Building today. He carried with him the distinction
of being the only executive of that doomed energy corporation
not planning to stand upon his Fifth Amendment rights under
questioning by one of the crowd of Congressional investigation
committees. He came into the well looking every inch the high-powered
corporate CEO in his somber gray suit. Once upon a time, the
financial largesse of his company was passionately courted
by the men and women facing him from behind the other battery
of microphones across the room.
Perhaps he believed that would count for something. It did
not. He was destroyed. By the time the afternoon's questioning
concluded, Skilling had played Dresden to Congress' air force.
He was done in, not by the strafing runs of indignant politicians,
but by the sheer dazzling volume of lies that poured from
his lips.
Skilling claimed he did not know Enron was in financial trouble
when he abruptly left the company last August, an action that
wound up being the catalyst for the stock meltdown that eventually
led to the catastrophe. He disagreed with the damning accusations
from the Powers Report, assembled by a special committee comprised
of Enron board members, and claimed the executives were unaware
of any wrongdoing. He blamed the accounting firm Arthur Andersen
and Enron's law firm, Vinson & Elkins, for the company's demise.
He could not recall being at any meetings where the double-dealing
plans were laid, though his position required his presence
at many of them, and his name is on the memos produced regarding
them.
Skilling was reminded that, as CEO, his signatures were required
on all cash expenditures. He did not recall ever seeing one
expenditure request. In essence, Skilling denied knowledge
of virtually every aspect of the financial transactions flying
through his company, one of which ran to the tune of $800
million for an off-the-books shell entity called Raptor. Former
Republican Presidential candidate Steve Forbes, himself a
CEO, heard this testimony during a later CNN interview and
reacted as though someone had slapped him with a dead fish.
He found it all but inconceivable that a CEO could have had
such scant knowledge of the workings of his company.
Finally, Skilling took the extraordinary step of calling
one of the central witnesses against Enron a liar. Sherron
Watkins, the whistleblower whose August letter to Enron chairman
Kenneth Lay outlined in excruciating detail accounting practices
that eventually brought the company down. In that letter,
Watkins described an encounter between Skilling and Clifford
Baxter, the former Enron executive recently found dead from
an alleged suicide. According to Watkins, Baxter "complained
mightily" to Skilling, and anyone else within earshot, about
the financial doings within the company.
Skilling chose to recall this encounter entirely differently.
Yes, Baxter raised some questions, but indicated his belief
that nothing was wrong with Enron. In fact, Baxter's whole
purpose was merely to warn Skilling not to have any dealings
with company CFO Andrew Fastow. The unasked question hovered
below the ceiling within that Congressional chamber: if Skilling
was so uninvolved with the basic financial operations of the
company, as he claimed, why would Baxter bother to warn him
about Fastow? In one fell swoop, Skilling denied ever having
heard of trouble within Enron, and called the veracity of
Watkins into question.
These assertions, along with all the others, were met with
a level of Congressional skepticism that peeled the paint
from the walls. Perhaps not since Lt. Colonel Oliver North
occupied Skilling's interrogation chair have so many lies
been told in one day's testimony to the House of Representatives.
The members were unconvinced, to say the very least. Mr. Skilling
has a number of powerful attorneys on retainer. He will need
them more than ever after today's performance. No Kamikaze
ever crashed harder.
It can be argued that this was a perfect moment for Skilling's
testimony, as this has been a golden age in the history of
lying. Late last month, Florida governor Jeb Bush denied ever
having spoken to anyone from Enron about anything, ever. However,
newly released public records disclosed a half-hour telephone
conversation between Jeb Bush and Kenneth Lay which occurred
last April. Bush and his people were forced to declare that
the governor had no memory of the conversation.
Yet a closer review of these records reveals a series of
exchanges that would appear to be difficult to forget. Tallahassee-based
Enron lobbyist Bill Bryant spent a good deal of his time attempting
to forge a connection between Lay and Bush. On March 8, he
received an email from Governor Bush, who wrote that he would
"love to meet with Ken." The contact came a month later when
Lay called Bush on his private phone in the Capitol.
Lay was attempting to cajole Bush into bringing Florida into
the same deregulation scheme that Enron used to enter and
dominate the Texas and California energy markets. Such a move
would have had profound impact on Florida's energy distribution,
and would have brought about a sea change to the way energy
business is done in the Sunshine State. It is reasonable to
assume that a governor, the highest-ranking member of state
government, would recall at least some of the details of a
proposition of such momentous import. At the very least, a
conversation with a executive whose company gave $10,500 to
the governor over a period of six years would seem to stand
out.
Jeb Bush appears to follow the same leadership model as Jeff
Skilling, using a hands-off approach while keeping a healthy
dose of amnesia in the desk drawer. As with Skilling's testimony
today, Governor Bush's cries of ignorance stimulate the raised-eyebrow
response.
Enron Corporation, and all involved with its collapsed, have
become more politically radioactive than Clayton Waagner at
a NOW rally. The stench of this catastrophe is so rank that
those within the blast radius are required to tell lies of
outrageous magnitude to escape taint.
One cannot necessarily be blamed for a desire to come in
out of the rain. In the case of Enron, however, there simply
isn't enough roof to go around.
The individual most desirous of a windy gap between himself
and all things Enron is George W. Bush. Bush already has an
image problem in this area; his 2000 Presidential campaign
was fairly drenched in Enron contributions, and a mob of former
Enron employees, consultants and stockholders hold high positions
within his Administration. Vice President Cheney has already
admitted to slow-dancing with Enron while compiling national
energy policy, and is now awaiting GAO subpoenas because he
is too discomforted by these dealings to reveal their substance.
Kenneth Lay has undergone a profound transformation in the
eyes and mind of Mr. Bush. The man once referred to as "Kenny
Boy" by Bush now suffers under the rigorously distant moniker,
"Mr. Lay." Thus, Lay's un-personhood is cemented. Bush claims
his administration had little to do with Enron or Lay, and
helping that company's fortunes was in no way a policy within
his Administration. These denials are not quite good enough
for the Justice Department, which recently requested that
the White House to retain for possible disclosure any and
all documentation pertaining to the Administration's dealings
with Enron. Unless someone has located George Shultz's old
shredder in the White House basement, these records may well
reveal the office of the President of the United States to
be yet another nest of Enron-related lies.
The same Justice Department demand has been delivered to
the Pentagon. The Department of Defense must retain all documents,
emails and other correspondence related to Enron. Part of
the request described Justice's belief that "documents in
possession of the Department of Defense, its staff and employees
may contain information relevant to our investigation into
the financial condition of Enron and statements made by Enron
employees and agents relating to the financial condition and
business interests." It is most likely that this request was
aimed at Secretary of the Army Thomas White, who was an Enron
Vice President before joining Bush's administration.
This is the same Pentagon that challenged the accuracy of
a report issued by the Center for Public Integrity on January
11th. The report exhaustively detailed the Enron stock holdings
of 14 Bush administration officials, including Defense Secretary
Donald Rumsfeld, Undersecretary of State Charlotte Beers,
Trade Representative Robert Zoellick and Presidential advisor
Karl Rove. As it happens, the Pentagon was alleging that CPI
claimed these individuals held Enron stock at the time of
the report's release. In fact, the report clearly indicated
that each of these officials divested themselves from the
stock before joining the administration. In the matter of
Enron, defensive hair-splitting has been raised to an artform.
This stonewalling cannot be maintained eternally. Even if
a thousand shredders grind for a thousand hours, the trail
of evidence is too vast, and the mob of victims too thick,
to avoid a reckoning. An executive facing prison time will
make a deal and begin to talk. A damning body of photocopied
Enron documents, created to serve as an insurance policy for
someone who knew the party was coming to an end, will turn
up. As Governor Willie Stark said in 'All The King's Men',
"There is always something." On that day there will be no
lies, no excuses, and nowhere to get in out of the rain.
This article originally appeared in Truthout.
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