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The
Daily Whopper
Remember the Enron
December 4, 2001
by
Jeremiah Bourque
The new Alamo.
The greatest monument to tall, white, Christian, right-wing,
rich, Texan, male arrogance of them all.
Enron.
Gone.
No one could have seen this coming.
No one could have possibly forseen the degree to which Enron
was hiding financial information from investors.
No one could have believed that Enron could have fallen so
quickly.
Oh yeah. Sure.
Let's get one thing clear: Enron was a disaster waiting to
happen that was easily forseen many months ago when word came
out that Enron was a company using its energy business as
financial leverage to dominate speculative markets. In other
words, it was a public corporation set up to be a hedge fund.
Now, hedge funds, themselves, have special rules that they
must operate under, including a very strict, up-front dictation
to shareholders of the risk that they may be forced to bear.
Enron did nothing of the kind. Enron said "Trust Us," but
hid why anyone should, leaving only their inflated profit
figures as proof that they could beat the system, skirt the
law, and utilize political influence and corruption to their
clear advantage, as they have done so often before, in California
and elsewhere.
Obviously, setting up a public corp as a hedge fund is absolutely
begging for disaster. The deeper a non-hedge fund gets into
the business of hedge funds, in this case, into the commodities
business, the more exposed it becomes to losses that threaten
the legitimate business on which the hedging is based.
Is this somehow odd? Is this some sort of fundamental lack
of understanding? Did the financial media just not understand
the meaning of the danger of this behavior?
Nah. They just didn't care.
Let's keep some things in mind here. Each and every audit
had Arthur Anderseen chartered accountants signing off on
Enron's books. All of Enron's public reporting had to be overseen
by accountants who have to put their signature and what is
essentially a sworn oath that these documents were prepared
correctly and provide a correct picture of Enron's financial
status. If even the best Wall Street professionals couldn't
cut through the fog, how could these accountants do so? Far
more plausible that they were as confused as anyone else,
and decided that it was not worth caring about. Enron, they
must have decided, was just too good, too profitable, too
lucrative... why raise a fuss and ruin a good thing? There
was a lot of money involved.
That, in fact, is the point. There was a lot of money involved,
including for the board of directors, including the directors
who sat on the audit board. The same individuals who decried
public oversight ended up simply buying off those charged
with private oversight. When even the board is party to the
hedging and the squandering of other people's money, there
is no oversight whatsoever. That's precisely what Enron's
CEO's always wanted. That's precisely what no private corporation
should ever allow.
The gory details are here.
Enron was more than a company. It was a symbol. Enron was
part and parcel of the Mark Rich school of business: Pry yourself
into the middle of transactions that ought not require you
and add a layer of expense. The paradox of this is that if
Enron did its job properly, Enron would drive itself out of
business, due to the rise in the efficiency of the market.
Only the INefficiency of the marketplace kept Enron rich.
Besides this, Enron made a mistake, the mistake that is made
by all who rely on penis-size politics and business theory:
the belief that everything that had risen to the sky, would
continue to rise amid the crumbling all around. Put more plainly,
Enron had a net long position in a falling market and didn't
stop gambling.
Enron was the pentultimate symbol of American success. When
President Bush (the Younger) spoke of institutions of democracy,
he meant Enron. When Cheney spoke of American success stories,
he meant Enron. When all of these men spoke of the needy,
the truly needy of American society, they meant Enron. When
Republicans spoke of the deserving, they meant Enron. They
meant Enron and often cited Enron by name, and most certainly
were thinking of Enron as they said these things. Enron was
success. Enron was good. Enron was just.
Now Enron... is dust.
The dust, formerly known as Enron, was an illusion, but a
useful illusion: the illusion that if Hillary can make $100,000
on the commodities markets, then Enron can make billions.
This fundamental arrogance was fueled by their belief that
raping government and pillaging the public purse through any
means possible (directly or indirectly) was not only just,
but a moral imperative. In effect, the dust, formerly known
as Enron, felt that it had a God-given duty to manipulate
markets and take advantage of the law and the public.
Enron, the new religion of the greedy, the pentultimate combination
of Christian piety with the glorification of materialism,
is the new Alamo, not merely a religion, but a representation
of a way of life. An era has ended.
Though this is not the end of penis-size politics and the
arrogance of the rich Texan male, a type of human being that
considers himself superior to all other forms of life (and
that this is self-evident requiring no proof beyond their
own swagger), it is a significant blow to the prestige enjoyed
by this class of human beings. Like the ex Prime Minister
of the United Kingdom, the embattled conservative leader John
Major, who now heads the Carlyle Group (a piece of information
you may find interesting), Texan males in position of influence
and power now stand to be knocked down a notch, to be somewhat
laughed at, even pitied, for their inability to recognize
that the light at the end of the tunnel is sometimes a locomotive.
In this world, there are more important things than proving
who the "better man" is. Women are not just cheerleaders for
Texas A&M or trophy wives. Outrage over the murder of Israelis
and not even a crocodile tear over the death of many more
Afghans - and I mean innocent civilians here - at the hands
of Americans and their allies, just goes to show how outrage,
indeed, how morality and religion, is very selective to this
brand of right-wing Christian male arrogance, in a manner
that can be turned on and off like a switch.
I foresaw the fall of Enron, based on a simple and firm grasp
of economic fundamentals. It really ought not have been as
hard as people are making it out to be to cover their butts
after the fact. Enron was not Icarus; it was a thief, hiding
its theft by making public the proceeds while concealing the
means. This was obvious to anyone who cared to look closely
at the situation. How many people actually did this? It seems
that very few did.
Many apologists will now claim that Enron was a noble endeavour,
but those who do so, betray themselves: there is no nobility
in lying to your own shareholders; only greed, arrogance,
and stupidity.
This is my eulogy.
Let us Remember the Enron.
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