Against the Enron End-Run

By: Jeremy Rice

As Enron goes up in flames and the press tries to dig up more and more examples of the (morally) bankrupt energy company's influence on the White House, Democrats on Capitol Hill must not pay attention to the sentiments of White House know-nothing blowhard Ari Fleischer. But in order to do justice to the magnitude of Enron's criminality, they must play a steady, smart game designed not simply to bring the evil ones (Kenneth Lay, Arthur Andersen, etc.) to justice - nor just to restore the retirement benefits of 20,000 or so innocent Enron workers - but to expose every facet of the Bush administration's slavery to the free market.

"Bush spokesman Ari Fleischer urged Democrats to avoid 'partisan witch hunts, endless investigations or fishing expeditions'", the Associated Press reported last week, topping his Moose Lodge rhetoric off by saying if Bush's enemies want to tar the President with the Enron brush, "This dog won't hunt". But Fleischer also said, "This needs to be fully investigated to determine if there was any criminal wrongdoing" - and while he carefully added the phrase "by Enron", let's remember these words so they can be used against him. Over and over and over again.

Fleischer, of course, famously warned Americans to "watch what they say, watch what they do" after the September terror attacks, but his boss apparently wasn't listening. On Dec. 28, President Bush declared the following:

"I think it's very important to understand what took place. Government will be looking into this. The SEC will be looking into the matters. Congress appears to be looking into the matter, so there'll be a lot of government inquiry into Enron and what took place there."

Let's remember these words. Every time the White House complains that the Democrats are engaged in a "partisan witch hunt", let's remind them that the President and the press secretary both unambiguously called for thorough investigations of the Enron mess. If along the way we review the campaign contributions of Enron (which could snare some Democrats, sad to say), study their dealings with the administration and question the ethics of Cabinet members and other advisers, let's remind them that the President said he was "deeply concerned about the citizens of Houston who worked for Enron".

And if anyone questions why the hearings are being drawn out - say, through an election year, or perhaps on into a presidential election cycle - one might respond that the mess could have been cleared up quickly had the White House acted when it was first contacted by Enron, and had not the Bush administration's friends at the company not hired an auditor that allegedly ordered its staff to destroy documents pertinent to the investigation.

There's a home run to be hit here, but not if we swing at the first pitch. For instance, much has been made of Bush's ties to Enron, and much should be made of it. But portraying it as a friend of the President's getting favors from inside the White House is too simple a story. Karl Rove shot it down last week very easily in an interview with the AP: "The president knows (Lay). He is a friend. But the idea that he is a friend in the sense that this is a guy who's a close intimate is just ludicrous." This statement doesn't mean anything, and it can only seem to mean something if we take the easy way out and fling the most dramatic accusations at the President.

This case deserves a careful examination - as the President himself wants - and our care in putting together a case against the Bush administration will not only rid us of Republicans in the next go round, but it will also help us get an upper hand on Social Security reform, health care and energy issues - and perhaps a host of others.

A Good, Old-Fashioned Capitalist Screwing

Yes, Enron contributed more than half a million dollars to various Bush campaigns over the years, and yes, the Bush administration is rabidly pro-oil. But there's enough self-interest in this government for people to believe that the Enron ties had little to do with the Bush team's decisions. For this reason, we can't dwell on this as our only concern. I'm far more interested in stopping the free-market bent of government, and the Enron scandal could do just this.

Treasury Secretary Paul O'Neill on Sunday (1/13/01) reminded us of what the attitude of the current administration is to the marketplace: "Companies come and go. It's, part of the genius of capitalism is people get to make good decisions or bad decisions, and they get to pay the consequence or to enjoy the fruits of their decisions." But the New York Times on Sunday reported that Enron executives cashed out their shares over the last two years to the tune of $1.1 billion - split between 29 people. So apparently the "consequences" capitalism pays are pretty good if you're actually making the decisions.

The workers, the people whose decisions were made for them, they don't split up the $1.1 billion. (If they did, that's about $55,000 apiece for those of you playing at home.)

From the environment to charity to education to retirement, this administration counts on the free market to guide the way. The Enron example shows that this benefits the wealthy at the expense of the workers. The United States benefits from openness, but the "free" market is a misnomer. It always exacts a price, and those good, patriotic Americans who suffer at its hands deserve the help of the government. Clean water, good schools, Social Security and health care cannot be left up to the market. Can you imagine what Ken Lay would have done to any of these programs - these necessities - had he any control of them?

Enron's chief goal as a company was to take a product and inflate its worth without actually doing anything to it. This was how the energy market worked, and as long as states deregulated, Enron and others could force up the price to maximize profits. This practice resulted in California power companies going bankrupt. It worked so well that, according to former federal energy regulator Curtis Hebert, Lay threatened Hebert's job if he didn't support unfettered regulation. As long as he had a sympathetic government behind him, Lay could play the master magician and make money out of nothing.

Bush, Like Enron, Makes Money Out of Nothing

This principle of making policy out of things that don't really exist is widespread in the Bush administration. For instance, last week the CIA released a report saying China would be able to deploy about 100 nuclear warheads by 2015. This sounds scary, except the same report said "the threat of terrorists attacking the United States with weapons of mass destruction delivered by unconventional means is now more likely than the threat posed by states launching a ballistic missile attack", according to the Times account.

So why would the headlines stress China's nuclear capability over the fact that our main threat over our lifetimes will be that from less sophisticated delivery systems? Because the administration's ties to defense contractors lead it to gear everything toward the development of missile defense. It's the only reason Defense Secretary Donald Rumsfeld is in the government at all (given the press's attention to his "sex appeal", you'd have thought he was chosen for his great ass).

Nicholas D. Kristof wrote last week that the Bush administration should engage North Korea in order to keep it from becoming an ally of rogues like al-Qaida. While the country has supported and carried out terror in the past, with some prompting it could steer clear of helping our enemies in exchange for needed cash. But the administration is reluctant to deal with North Korea, and earlier this year Bush torpedoed the South Korean bid to further open relations with the North.

The administration "is going to have to justify a budget busting missile defense proposal predicated on threats from rogue nations", Adam Joyce wrote in these pages at the time, and Kristof echoed that thought in his column. So while we could gain much from diplomacy, we will reject it in order to keep North Korea on the list of pariahs we must protect ourselves from.

Enron is the key to explaining, once and for all, how business is not the answer that O'Neill and the rest of the Bush team say it is. The scandal will also show that this administration invents problems - the immediate Social Security "crisis", the impending energy "crisis" - in order to give more and more power to their business friends. It will also, most importantly, show working Americans across the country that this president cares nothing for their interests and actively works against them. This government is not a toy, and it must be taken back.

It will be taken back if Democrats play smart.