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.