The Cost, er, Genius of Capitalism (con.)

Scott Thill

White is right! Army Sec'y Thomas White may have to face the congressional music next. So he'll probably get off. (AP Photo)

White, like so many other Enron execs, no doubt knew the End of Days for Enron was long overdue and, like Kenneth Lay and so many others (including J. Clifford Baxter) dumped his shares, helping push the energy giant into the abyss. Although the truth about White's situation will not be known until next year's disclosures arrive, any professional gambler will tell you that a lock is a lock -- and White was no dummy. Consider: According to an email obtained by the Los Angeles Times from a former Enron employee by the name of Margaret Ceconi, White's division at the energy giant, Enron Energy Services, transferred more than $500 million in losses to Enron Wholesale Services in hopes of fudging the numbers and deceiving investors and analysts. The purpose, of course, was to hide how bad the company had screwed up and not raise any red flags on Wall Street, something that was inevitable in the long run. Ceconi's email was dated August 29, a scant few months after White had vacated his seat for a more, uh, satisfying job in public service.

The genius of capitalism, indeed. This money trail is there for anyone with half an eye for patterns to spot, should they be so inclined. Which makes it hard to believe that White could have not "knowingly misrepresented EES' earnings," as Ceconi wrote in her email to, who else? Kenneth Lay. The fact that she wrote this email (which the L.A. Times has suspiciously characterized as "rambling" without any qualification) upon finding out that she was being fired -- for anything other than being "disgruntled," according to Enron spokesman, Mark Palmer, we will have to wait and see -- will no doubt be used as ammunition against her, as similar circumstances have for the late J. Clifford Baxter and Arthur Andersen scapegoat David Duncan, among others.

Whatever the truth may be, one thing is for sure: Thomas White -- who just recently was in charge of a division that knowingly deceived its investors and analysts to the tune of millions for a company that is at the center of the greatest corporate scandal in American history -- now works for the government.

So do countless others with Enron stock, leading one to reconsider the Ashcroft Example, whereby one publicly admits that s/he is incapable of fulfilling an all-important public service -- the kind that many left the private sector's millions to execute -- because of a conflict of interest. And let us remember, Ashcroft did not own Enron stock, so his monetary connection to the corrupt energy trader was somewhat limited, considering he did not have a continuing interest in making sure he didn't get taken to the poorhouse.

Which begs a crucial question: what exactly is the difference -- when it comes to so-called conflicts of interest -- between campaign donations and corporate shareholding? Not much it would seem.

The members of the Bush administration holding Enron stock fill critical positions governing everything from United States energy policy, economic affairs, rural development, agricultural negotiations, science and technology, the list goes on. Would it not seem logical then, given the Ashcroft Example, that these public servants also would feel the pangs of conscience possibly interfering with their stock portfolios, that they would make decisions, as Ashcroft has in his absence, based on their own self-interests rather than the collective interest of the United States citizenry? Suffice it to say that if others followed the Ashcroft Example, our government would be a skeleton of its former self, unable to make the most basic decisions possible.

Which I guess is kinda the point. Enron stocked the pond with its paid employees and advisors, hoping that its investment in American government would pay off big, which it has. But its overarching greed and disregard for the safety and savings of its own workforce brought it doom, destruction, and in the case of J. Clifford Baxter, death. And, in a realm of lies and misrepresentation so deep that it touches the very fabric of our ability to conduct government business without fear of corruption, even Baxter's death is a mystery that will energize conspiracy theorists of all stripes.

Can we honestly depend on the aptly named Sugar Land Police Department to provide us with the truth about the suspicious death of an executive who spent that last weeks of his term at Enron "complain[ing] mightily to [then-CEO Jeff] Skilling and all who would listen about the inappropriateness of our transactions," according to Enron whistleblower, Sherron Watkins, especially since their jurisdiction includes one of Houston's most affluent suburbs, where many Enron employees of undue power and influence may reside? And especially since, as stated before, even the entire U.S. Attorney's office in the same town has recused itself from the Enron case because of a conflict of interest? Red flag: Sugar Land police are refusing to disclose the contents of Clifford's suicide note, a document that may contain more answers to a national scandal than the ribbons of shredded papers hoarded by Enron and Andersen.

Genius of capitalism, eh? So that's what they're calling rampant corruption these days. Thanks, Paul! (Reuters)

I smell a rat, and so has the entire United States populace not living in Texas for months, even after so many figures have fled the sinking ship, abandoning their friends and colleagues, who now must take the Fifth, commit suicide, or abandon their posts for cushy secretary gigs in a friendly administration.

Like I said, the genius of capitalism, indeed. If Paul O'Neill is correct, we must bow our heads and thank capitalism for the bounty it has provided us over the last few years: a national recession, mind-numbing financial misappropriation, corporate greed and deception, suicides and unemployment, retirement pillage and savings liquidation, billions lost to the global economy -- always good medicine for capitalism, no? -- a shattered faith in not only our government and its representatives but in multinational corporations as a whole, facetious bailouts of companies that don't deserve it at the expense of American workers - let me know when I can stop. Truth be told, the list goes on ad infinitum, ad nauseam.

"A handful of rich people, closely tied to the Texas Republican Party led by Gov. George W. Bush and Sen. Phil Gramm, decided to become richer still. Their grand strategy included deregulation of energy, deregulation of derivatives (an arcane financial device), corrupt accounting practices, overseas tax scams, U.S. diplomatic pressure (delivered in 2001 by Dick Cheney himself, on India, where Enron had sold a white elephant power plant). And then, as the game unwound, they sold their own stock while freezing employee pension accounts. In the end, the gang made off with more than a billion dollars, that we know of."

It doesn't get much simpler than that, regardless of the intricacies of the plot, the timing of the events, or the shuffling of the characters. When the world is focused on the exec with the bullet in his head, the auditor who may be a scapegoat, the glamorous story of yet another high-flying -- I really wish journalists for the AP would stop using that character assessment to explain Enron, don't you? -- corporation that was brought down to earth, ad nauseam (again), there is always the Big Picture, that is, capitalism's Big Picture. Galbraith's condensation of American capitalism as Enron and O'Neill has illustrated it is both sweeping and inclusive. And, therefore, its genius seems to usually extract equal parts money and blood so far.

If this is capitalism's genius, then ignorance truly is bliss.

30 January 02

Back: "I call it an admittance of failure because this is precisely the job Ashcroft was hired to do: ferret out corruption, levy serious penalties, bring the hammer down on buddy and criminal alike no matter what the circumstances may prescribe."

Scott Thill -- a media fanatic who finds the time to write on everything that does not include the words "boy band" -- is a gainfully employed dotcom editor currently finishing his first novel, The Dangerous Perhaps.