USA, Enron financial scandal


This video from the USA is the film Enron The Smartest Guys In The Room.

By Joe Kay:

The Enron verdicts: corruption and American capitalism

29 May 2006

The guilty verdicts handed down by a Houston jury last week against former Enron chiefs Kenneth Lay and Jeffrey Skilling provide an opportunity to evaluate the significance of the company’s rise and fall within the context of American capitalism.

Accounts by jurors given after the verdicts were announced indicate they all agreed that the evidence against the two executives was overwhelming.

It consisted mainly of testimony from over a dozen former executives, who implicated Lay and Skilling for their roles in defrauding investors and employees through various forms of accounting manipulation.

The jurors quickly rejected the absurd position of the defense that Enron was basically a healthy company that collapsed into bankruptcy in December 2001 largely as the result of Wall Street machinations and negative press coverage.

Several jurors indicated they reacted negatively to the testimony of the defendants, and particularly Lay, who could not hide his arrogance while on the stand.

Arrogance which Lay also showed, eg, in a 2004 interview with Larry King on CNN, in which he claimed the God of Christianity was on his side.

Bush and the Enron scandal: here.

More Enron: here.

Update January 2008: here.

8 thoughts on “USA, Enron financial scandal

  1. Trivializing Corruption
    By David Sirota

    (Written for the online edition of PBS-TV’s “Now”)

    Ninety thousand dollars in a Democratic Congressman’s freezer. A Republican House Majority Leader indicted for money laundering, and a senior Republican thrown in jail for accepting bribes. Washington’s biggest lobbyist thrown in jail for trying to buy off lawmakers. This is what the Washington Establishment and the media want America to believe is the worst form of corruption: a few dirty political hacks who had the nerve to violate our supposedly pristine democracy.

    Certainly, these examples are egregious. But the intense focus on them by political leaders and the media to the exclusion of the real corruption destroying our democracy trivializes what corruption really is. That’s not by accident — it is a deliberate tactic of distraction, and shows just how bought off our political system really is.

    Today, the lifeblood of American politics is money. Candidates must raise enormous sums of private cash to run for office — sums that the wealthy and corporate interests are only too happy to provide in exchange for legislative favors. We are told by politicians that this system is “the greatest democracy in the world” when, in fact, it is very clearly the same form of bribery that has marked every corrupt regime looked down on by history books.

    Money, of course, does not just buy favors — it makes sure that the concept of corruption is only presented to the public by political leaders as anecdotes about a few bad apples, not a narrative about a broken system. Why? Because an indictment of the pay-to-play system that produced the bad apples could mean structural campaign finance reforms that challenge the power of the Big Money interests that underwrite our politicians. Thus, in the aftermath of recent congressional scandals, all we get is a pathetical discussion about weak lobbying “reform” proposals and even weaker sanctions against individual lawmakers.

    Such narrowing of our political discourse is the most nefarious form of corruption of all. It shows how we now live in a country where the very boundaries of public policy debates are designed to ensure outcomes that never challenge Big Money interests. The truly corrupt interests that own American politics long ago realized that they do not have to pervasively violate our weak anti-corruption laws to get what they want. All they have to do is shower cash on as many lawmakers as possible. These lawmakers, uninterested in biting the hand that feeds them, consequently make sure the overall debate is rigged.

    So, for instance, as America faces an impending energy crisis, the political debate emanating from Washington has been largely limited to a discussion of which new tax breaks to give to which major oil companies — all of whom have doled out millions in campaign contributions to politicians.

    Any serious discussion of a windfall profits tax on oil companies has been marginalized, even though polls show the public strongly supports the concept. Proposals to improve anti-trust enforcement as a way of slowing down oil industry consolidation — that’s not even talked about. And any consideration of a tough federal price gouging law has been met with propaganda claiming it is not needed. Just last week, the Federal Trade Commission — headed by a former ChevronTexaco lawyer — claimed there is no evidence of oil industry price gouging. This is occurring as Americans are paying more than $3-per-gallon for gas at the very same time ExxonMobil made more money than any corporation in history and gave its outgoing CEO a $400 million retirement bonus.

    The same is true when it comes to health care. As health insurance premiums skyrocket and more Americans are forced to go with no insurance at all, polls consistently show that Americans want a universal health care system — and are willing to make sacrifices to get one. Yet, almost no politicians in Washington are willing to support a government-sponsored, single-payer system like the one the rest of the industrialized world has. The reason? Because such a proposal could threaten the bottom line of the private health insurance industry, which makes massive donations to political candidates. Instead, the debate is limited either to proposals like Massachusetts’ that simply forces citizens to pay high health premiums, or to proposals in Congress that would just hand over billions of taxpayer dollars to the private health insurance industry to minimally expand coverage.

    Even on hot button issues like immigration, the debate is narrowed to fit Big Money’s agenda. Think about it — the political Establishment is having a supposedly intense debate over illegal immigration without even mentioning the corporate-written North American Free Trade Agreement. This is the pact that, more than a decade ago, was sold to Americans by President Clinton and Republicans in Congress as a way to improve the Mexican economy and drive down illegal immigration, but which actually drove millions more Mexicans into poverty and increased pressure at our southern border. Almost no politicians have even raised the concept of adding wage or workplace protections to the pact as a way to improve the Mexican economy and give Mexicans a better incentive to remain in their country — because to raise that concept would be to challenge politicians’ corporate campaign donors who want access to Mexico’s impoverished, exploitable workforce.

    To be sure — politicians will continue their efforts to focus attention exclusively on the bad apples within their midst. They will then cite their own outrage as proof they are true “reformers.” Just as they feed us false storylines about supposedly working for us when they are working for Big Money, they will tell us they are serious about fixing our broken political system, when they really are not. Because, as we see, when the cameras shut off, Washington’s bipartisan establishment still refuses to embrace systemic reforms like public financing of elections that would actually end the pay-to-pay political culture.

    We, the public, can hope and pray for change, and we can delude ourselves into thinking that a simple change in party control will fix our problems. But the simple truth is that until we go to the ballot box and punish representatives from both parties who are part of this consensus, we will continue to live not in a democracy — but in a system of legalized bribery that makes our problems worse.

    David Sirota is the author of the new book “Hostile Takeover: How Big Money and Corruption Conquered Our Government — And How We Take It Back” (Crown Publishers, May 2006)

    Read this at http://www.pbs.org/now/shows/224/money-democracy.html

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