Another opinion from a month ago...
Clinton-Gore sales team eased Enron's path to success
Sunday, December 9, 2001
WASHINGTON - "Humpty Dumpty sat on a wall, Humpty Dumpty had a great fall."
This week, this old nursery rhyme has taken control of this column. From
Washington to Pittsburgh by way of New York City and Los Angeles with
important detours to China, Japan, India, Mozambique, Croatia, England,
Germany and elsewhere in the world, we have been watching and reading about
the great fall of Enron.
What a fall and from what a great wall! The Enron Corporation's 50-story
building had always cast a shadow on Houston's South Street, and it
glittered in the sunlight as Enron began to fall and stockholders scrambled
to dump their shares. And Enron's shares were dumped - the value of company
shares fell $22 billion (yes, that's a "B"!) in the past six weeks!
Coming Dec. 16
Members of Congress complain about inconvenience, gripe about their
temporary offices and act like greedy children in a sandbox. Meanwhile,
Attorney General John Ashcroft's first-class job performance makes him the
No. 1 target of The Washington Post. Read about it in Sunday's ``Dateline
D.C.'' column, a Tribune-Review exclusive.
"All the King's horses and all the King's men couldn't put Humpty together
again." As in the nursery rhyme, so in fact.
Enron, the Texas-based international energy giant now seeking escape from
bankruptcy, faces huge problems with even attempting to put its mirror-like
combine back together again. And, despite the "King's men" having help with
the heavy lifting from the White House, Congress, the courts and hundreds of
faceless bankers and bean counters, this Dumpty just won't fit together
anymore.
Even the new name of Dumpty reflects on a stricken giant. Shares valued at
$90 each this August are selling for 10 to 26 cents. These once
wonder-shares have been degraded to "junk" as thousands of investors rapidly
dumped 173.6 million shares. Dumpty Enron, facing losses worldwide that add
up to more than $5 billion, now is a monster under stress - and it is a
monster that is both shameless and insatiable.
Dumpty is sniffing around its key creditors (J.P Morgan, Chase and
Citigroup) for what is called "debtor-in-possession" loans of more than $1
billion. This shows the truth behind the adage that if you owe a bank enough
(Enron owes some $3 billion), you own the bank.
The geniuses of the 21st-century marketplace will now learn a sobering and
exceedingly painful truth. The kindly, gentle and truly awful socialist
pediatrician, Dr. Benjamin Spock, was effectively responsible for Dumpty
Enron's collapse and for much else that is wrong with our Republic today.
Because of the genial old doctor, generations of decent American babies
developed into troll-like kids ready to stamp and scream until they got what
they wanted. Undisciplined, and having forfeited love for abhorrence, they
became gargoyle-like adults, liberally laced with Prozac, whose creed was,
"If you get away with it, it's cool. Getting caught is bad, so be more
careful next time." Dumpty Enron got caught!
The so-called "popular press," in its usual searches for the clay feet with
which they invest every well-known person, will now try to link Enron's
present woes to the White House. Too bad, guys, you should have started
investigating Enron's ties (ties not links) in 1993 and onward to the sales
team of Bill Clinton, Al Gore and Ron Brown.
Congress is to initiate hearings as to what went wrong with Enron. It's a
safe bet to assume that a major part of the investigation will center on
Enron's 5,000 Houston employees who may be jobless within a few days.
Jobless and learning that their pension plan was based on company stock that
has lost 99 percent of its value. As they live on their unemployment and
Social Security pittances, these unfortunate thousands can think about how
their employer and its accountants, Arthur Anderson (paid at $1 million a
week), inflated profits on paper and scaled down the company's debts. To get
away with that kind of "little illegality," a close-mouthed loyal staff is
vital. Already prosecutors from the Securities and Exchange Commission,
Internal Revenue Service, San Francisco, Los Angeles, New York City and
Houston are finding voluble and knowledgeable witnesses eager to cooperate.
Subpoenas for individuals and records are now being served.
Yet with so many politicians from both political parties being the
recipients of Enron's political donations in both hard and soft money,
objective justice may not be easy. Moreover, Enron was generous to the last
cent of other people money! Its corporate leaders funded business schools
and scholarships, and gave and gave to the United Way! Even Houston's giant
sports arena, home to the Astros baseball team, carries the name "Enron
Field," a little vanity that cost a mere $100 million for a 30-year deal.
Enron had the best brains that money could buy, but gave the word "ethics" a
whole new meaning. The cowboys of Dumpty Enron talked up a storm about
ethics; but only a few at the top realized that "ethics" was an acronym for
"Enron thinks how income can (be) stolen."
That's a stretch; but look at their 1994 sales team - Clinton, Gore and the
late Ron Brown - a trio unlimited and uncontrolled in their cunning and
greed.
In what seems to be eons ago, before Gov. Bill Clinton became president, the
late, much loved and little lamented Ron Brown was Clinton's good friend and
a power broker in the National Democratic Party. Ron Brown had a friend, a
congressman from Houston, the late Mickey Leland, who died in 1989. Until
his passing, Leland was a shining light in the Congressional Black Caucus
and a dedicated socialist, who was one of the Institute for Policy Studies'
delights.
>From 1984, when Enron was conceived, Brown and Leland were there snapping up
unconsidered trifles of money for use in their campaigns against the free
market. Mickey was able to ease a lot of Enron's early problems through the
Houston City Council by playing his "equal opportunity card." He had also
become an African expert who initially took the Enron message to that
continent, a chore that was taken on by Ron Brown, Clinton's secretary of
commerce, before the latter met his untimely death in a highly controversial
plane crash in Croatia. (Untimely, because had Secretary Brown lived, he
would have faced multiple criminal indictments that could have precipitated
an even earlier fall for Bill Clinton and his gang.)
Now we get to that old puzzle about chickens and eggs, and what came first!
Ron Brown, Al Gore and Bill Clinton introduced Enron to market managers in
Russia, China, Indonesia and India. In India, Enron quickly became involved
in one of that country's most massive corruption investigations, contracts
were canceled and Enron was out.
On the other hand, Enron introduced the Clinton team to Lippo Industries and
thence to China's People's Liberation Army (a wonderful source of political
cash), to John Huang, another good provider and to nameless, numberless
Arabs who never arrived with empty pockets. If we look at a list of those
attending coffee klatches at the White House, we can learn why a storm of
doubtful deals enabled Enron to quickly control one-quarter of the world's
electricity and natural gas. But, that wasn't enough. The ever-so-greedy
Dumpty moved in to water deals in Massachusetts and Europe, paper mills in
Canada, gas pipe lines throughout the world, fiber optics, television,
mutual funds and information gathering. In turn, that led to risk analysis,
a name that those clever Texans quickly changed to "reward realization!"
The rewards were good! Enron, with sales assistance from Tony Lake, then
Clinton's national security adviser, persuaded the impoverished, war-torn
country of Mozambique to sign a $770 million electric power contract.
Mozambique signed because Tony's salesmanship was persuasive. If the
Mozambicans didn't sign, he indicated that their congressionally approved
$44 million U.S. aid payment would never be made.
And there was the Croatian caper. In the days when Franjo Tudjman was
Croatia's dictator and pretending to be both a reformed communist and best
friend of America in the Balkans, poor Franjo had a problem. He and some of
his very best friends were wanted as war criminals by the Hague's
International Court of Justice. Enron wanted a power contract with Croatia.
Enron offered a deal to Tudjman. Sign up with us and we will use our gang in
Washington to make sure you and your friends don't go to jail.
Tudjman signed. Enron made a heap of money. Nobody went to jail. Everyone
was happy - until Tudjman died of cancer. Then the lid was off, his Croatian
Democratic Union was defeated and the new boys in power in Zagreb could not
believe how much of their budget went to pay the electricity bills from
Enron.
Somebody - probably another Dr. Spock child eager to tell on his peers -
prattled! Under quiet pressure from the Croats, another deal was made and a
couple of guys were charged as war criminals. Electricity costs went down
(but not to the consumers) and as a part of the deal nobody talked, except
about the wonderful vacations that they were enjoying in the Caribbean.
This could be called a "cautionary tale." There are two cautions. The first:
Beware of the Spock babies now that they are nearing retirement and losing
whatever sense they had. The second: Investigators all, beware, as you look
into the depths and shallows of Enron you may, if you are truly unlucky,
find the truth. And, if you do, these truths won't make you free, just well
informed.
Since Sept. 11 and the anthrax outrage, some government departments have
expanded and dispersed around the Washington region. One department,
identified by the usual alphabet soup of letters and much concerned with
gathering and processing intelligence and information from all over the
world, now finds itself in a building where, a few floors below its official
quarters, there is a restaurant and bar.
The deputy director of this government enterprise is a gentleman with a
liver like the soles of an old boot. He sits in the bar from 10 a.m. until
noon. Then he leaves for lunch; but he resumes his bar watch at 2.30 p.m.
and leaves with his car pool at 5 p.m.
Our poster boy does not waste his day. Throughout his vigils, colleagues
from other agencies visit him with their reports and requests. Information
is exchanged and even one or two job applicants have been interviewed. And,
of course, every day and every hour, his flatterers and flunkies, who make
sure that his check is paid, surround the deputy director.
With cold weather forecast, the prospects of stories from warm, comfortable
quarters, while appealing, are canceled out by a hereditary need for cups of
strong tea!
"Dateline D.C." is written by a Washington, D.C.-based British journalist
and political observer.
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