Republicans Drop More Senseless Bombs On New York
March 4, 2002
By Mike Schiller

In an attempt to divert public attention away from the government corruption aspects of the Enron scandal, both Bush and Congressional leaders are stooping to an all-time low. In typical Bush-logic-speak, Congress attempted to blame Wall Street Analysts for "not seeing the problems". This is simply misinformation and blatant propaganda akin to the assertion that the votes in Florida had "already been counted three times". Like the vote-count-lie, to the average person who didn't follow the events closely enough, it seems plausible.

Yet anyone who knows anything about how Enron's accounting practices became publicly known would tell you that the analysts on Wall Street were the first people to call attention to Enron's accounting practices! These analysts had already reduced Enron to a "Sell" recommendation before either the media and politicians had acknowledged the signals of the impending collapse. Congress was still considering legislation to plunder the arctic wildlife refuge and restructure the nation's energy regulations in favor of Enron at the time. The mainstream media was trying desperately to bury the story until it finally grew so loud it could not be contained any further. It was the widespread sell-off, triggered by the change in analyst recommendations, which forced the media and lawmakers to recognize the issues at Enron.

This smear campaign against Wall Street has no more substance than the White House vandalism scandal that was later revealed to be a hoax. As with the fake vandalism scandal, it's disappointing to see some congressional Democrats actually falling into Bush's trap. Anyone with an objective eye can clearly see that Enron's corrupt business practices were first brought to light by the analysts. Congress did not even acknowledge an Enron problem until months after most firms had already issued a strong "Sell" recommendation. The public, of course, doesn't (for the most part) know this because they weren't reading the financial trade papers at the time. So Bush and Congress tell more lies and distort the truth in their attempts to find someone else to blame for a problem that can only be blamed on the Republican Party (and a few Texas Democrats).

The media, covered companies, and investors, should listen to the analysts more often. When an analyst lowers a company's rating, the company should welcome it as a signal that changes to their business plan must be made. They should be thankful that there are people who are smart enough to recognize business trends and dispense advice that could actually help them to better themselves. Any company who tries to retaliate against an analyst, just because the analyst lowers their recommendation rating, is actually making a serious mistake. If Enron, or any other company truly wanted to succeed, they should be proactive, not reactive. The real crime committed was perpetuated by the mainstream news media, which tried to suppress the stories about Enron's impending collapse until the last minute, even as the company was being downgraded by Wall Street. The analysts exposed Enron for what it truly was. They were the first people to publicly speak about Enron's unsavory practices. They were the first people to disclose to the public that there was a problem. Bush had been silent. Congress was silent. The media was silent. Yet the analysts spoke up the moment they detected a problem. In fact, that's probably why these politicians are so bitter. The analysts were the real whistleblowers in this case, the true heroes, and they deserve to be praised, not chastised for it.