Enron: The Smartest Guys in the Room

[/types]]

The massive corporate malfeasance that led to the self-destruction of the Enron Corporation was stunning not just because of the bubble of unreality that surrounded the company for years as it bled cash like a hemopheliac while driving up its stock price like it was strapped to a Saturn booster. What was really like a kick to the head was the sheer number of corporate enablers they had. Had someone, anyone, called Enron on their practices, the company would have disintegrated years earlier than it did, presumably taking fewer pension plans and 401k’s down with it. The outrage that was the California energy crisis of 2000 might have been avoided as well.

Click here for details.
[/types] nudity=3 violence=0 language=4 subject=2]

I suppose Enron: The Smartest Guys in the Room could have been an exercise in self-righteous anti-business indignation, but it manages to be a reasonably evenhanded look at how people like Kenneth Lay and Jeffrey Skilling were self-deluded ego-maniacs and just plain bad businessmen as much as they were bad people. They were pretty bad people, too, and their post-bankruptcy attempts to avoid responsibility and save their reptilian skin from becoming judicial shoe leather mean that sympathy shall not soon be coming from this quarter.

Despite Kenneth Lay’s vilification in the media, Jeff Skilling was really the architect of the Enron house of cards. The energy trading scheme that ultimately led to the company’s downfall was largely Skilling’s baby.

The real outrage wasn’t simply that the business model was completely untenable, but how Chief Financial Operator Andrew Falstow played three card monte with the company’s debt, cheerfully aided and abetted by most of the world’s largest banks.

”[types
[/types]“]

Living in California, of course, I felt the full brunt of Enron’s “money uber alles” corporate culture as their West Coast energy traders played callous games to exploit every loophole in in the state’s half-assed electricity deregulation law. To hear recordings of them cackling like a convention of Bond villains over California’s electical woes almost makes we want the state to legalize drawing and quartering.

I am very much a libertarian and a believer in the efficiency of free markets over the inefficiency of government control, but Enron was an example of capitalism at it’s very worst. Lay and Skilling lost sight of why companies exist in the first place, to create things that are useful to others and allow the owners (shareholders) to profit from that act of creation. Enron created nothing, but merely bought and sold something (energy) that had been bought and sold just fine before they came along. In the end, the company existed primarily to line its own coffers and, when that failed, it existed to drive up its own stock price long enough for the largest shareholders to cash out.

The book this film was based upon should be required reading for business school freshman on their first day of class and they should be tested on it before graduation.

4 thoughts on “Enron: The Smartest Guys in the Room

  1. Nehring

    I finally saw this film tonight. Its very well done despite its blantant political bias.

    These guys should burn in hell for what they have done and this film does an outstanding job in making their complex game easy to grasp. The whole group should be forced to work soup kitchens for the remainder of their days. I love capitalism and I LOATHE government intrusion. This film makes the case that the first is not always best thing and the second isn’t always the worst.

    Reply

Leave a Reply

Your email address will not be published. Required fields are marked *