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"The
Past is Always in Front of Us." Greek Proverb
Introduction:
Enron:
Is "the fix" in?
Report:
In
an Enron memo dated June 19, 2001,
the company “reiterated…strong confidence in its earning
outlook…(based on) an “extremely strong” business. Then-CEO Jeffrey
Skilling touted that Enron “remains very confident that we will meet the
markets consensus recurring estimates…for both the second quarter and
full year 2001.”
Enron prided
itself as being one of the worlds leading energy and communications
company, whose revenues in 2000 were at $101 billion. This Houston based
corporation was pleased to inform their readers “Fortune magazine named
Enron as Americas Most Innovative Company for six consecutives
years."
This wave of
enthusiasm soon waned as allegations of questionable practices by
Enron and destroyed documents by their accounting firm, Andersen, became
public. Suddenly, an 'October Surprise' developed when the near
bankrupt Enron released a public memo that month announcing that William
Powers Jr., the Dean of the
University of Texas Law School, was appointed as a new Enron board
member. Enron told its shareholders and employees that the law dean’s tasks
included chairing a committee to investigate transactions between Enron
and other entities, and to recommend action to the SEC based on
(what RadioRote
shall call) the "Powers' committee report".
The stock fell
sharply to basically becoming a penny stock in December and now is no
longer recognized by the New York Stock Exchange. Skilling vacated his CEO
position prior to the fallout and was replaced by Enron president
Kenneth Lay. The Congress launched an enquiry in December 2001, and the
SEC began an inquiry into how Enron executed its trading practices.
Meanwhile 4,000 Enron employees were scuttled without a job and lost their
retirement funds, with further State retirement funds in question based on
the accounting principals of these two corporations.
But the
story did not start in June of that year. The history of Enron and their
influential supporters reflects a pattern of questionable and
rather unethical schemes. Their influence and downfall expanded well
beyond their headquarters in Houston. Their influence peddling and support
system follows a trail from Austin where both the Texas Governors office
and the University of Texas are located, to the Legislative and Executive
branches in Washington DC, to the off shore shell corporations across the
globe.
Enron CEO and
President Kenneth Lay may have been right when he expressed dismay as
White House cabinet members reportedly ignored his plea to help bail
out his financially troubled company. After all, this administration went
out of its way to prop up their other 'best friends that money could buy,'
and certainly were not reticent in the past in giving Enron what it so
desired...so why the turnabout now? One must decide whether this
sudden affront taken against Enron by the same political patrons who
constitute most of Enron's cash clique represents a real turnabout -- or a
calculated spin. After all, what corporation would purchase a former or
current elected official if the public perceived him or her to be nothing
more than a "slightly used and damaged" bill of goods?
Here is where politics takes its cue from business: Image is everything.
Therefore, the
real questions are:
-
Was the
administration straightforward when they told the public that a
full investigation is underway -- or are they framing the issues to
make it appear as if the important evidence will be scrutinized and
openly reported to the taxpayers?
-
Are key
people involved in the Enron investigation
"objective," or do their personal and professional ties
make it in their best interest to "cover each others backs"?
-
Further,
did the federal officials who blithely recused themselves from the
investigation do so out of ethics, or because they know that they
stand to lose as much as those who are investigating Enron, if
certain facts are revealed.
-
The same
cast of characters found in the Reagan/Bush White House currently have
close administrative ties to George W. Bush, or are somehow involved
the Enron investigation. These individuals share something else in
common: their participation in Iran-Contra. Is this becoming what
RadioRote
calls an
"Enron-Contra"?
Based on
the reports collected and predictions made by
RadioRote,
the answer is "it doesn't matter." The questionable
political and financial practices shared between Enron, The University of
Texas Regents, the Texas state capital as well as the law firms and energy
companies that contribute financially to the legislative and executive
branches in DC are so inexorably ensconced, that the investigation becomes
a no-win situation.
Although
William Powers jr., the dean of the University of Texas law school,
probably envisions his investigative task as one of an "honest
broker," the relationship and questionable practices amongst
those with whom he must now associate himself with at Enron, will create a
credibility gap between the future Powers committee report and how the
general public will perceive it -- it will raise public doubt about the
validity of the investigation before the report reaches its own final
conclusions.
Even if Enron, Andersen and the
investigators "come clean" on the final report and find, in an
honest effort, that no major wrong-doing was discovered -- the history
between the investigators, the interested parties and those they represent
will end up damaging the case by default.
Favorable
findings towards Enron might win the publics mind, but it will take more
than a report to win their hearts -- and
that, in the end, is just as important in a legal investigation as any
body of evidence.
Next
Article: How the Gramm Cracker Crumbled.
RadioRote®
allows distribution of information from its site, as long as RadioRote®
is cited or given credit. You may not use the
RadioRote®
logo, or alter it, unless citing it as a source. Please give
credit to other sources. ©2001
For problems or questions regarding this website contact radiorote.
Last Maintenance Performed: January 21, 2002
PLEASE
DISTRIBUTE
RadioRote®2001
Sources: Each source
is given a specific number which can be used to readily identify it.
1. Benjamin, Mark and
Horrok, Nicholas "Sen. Gramm's wife gets Enron Subpoena"
UPI 1/13/2002
2. Herbert, Bob.
"Enron and the Gramms" New York Times 1/17/2002
3. "The CFTC
Mission" http://www.cftc.gov/cftc/cftcglan.htm
4. Statement of Congressman Sanders on 12/6/2001
regarding: Enron Bankruptcy Case.
http://bernie.house.gov/statements/20011206181633.asp?print
5. Schemers, Robert.
"Enron is a Cancer on the Presidency." The Nation.
1/02/2002
6.
"Amalgamated Bank slaps suit on Enron top brass".
Reuters. 12/06/01
7. GAMBOA,
SUZANNE "Gramm's election cash
pile at or near top among senators seeking re-election" Abilene Press
08/02/01
8. Lindell, Chuck. "Gramm's
staff busy dousing rumors About A&M Post". Abilene
Reporter-News 08/30/01
9. "Evidence
Indicates That O’Neill Helped Enron Hide Financial Condition" Public
Citizen 1/18/02
Http://www.citizen.org/pressroom/release.cfm?ID=1000
RadioRote® allows
distribution of information from its site, as long as RadioRote® is cited
or given credit. You may not use the
RadioRote®
logo, or alter
it, unless citing it as a source. Please also give credit to
other sources found on the website. ©2001
For problems or questions regarding
this website contact
radiorote.
Last updated for
maintenance : January 21, 2002
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