The real Enron scandal
The deeper Enron scandal lies not in the nervous contacts with cabinet members when the giant corporation was sliding down the tube, but in its ability to manipulate a government awash in campaign contributions in the days when the company was flying high.Skip to next paragraph
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That President Bush called CEO Kenneth Lay "Kenny Boy" was not a scandal. What was a scandal was that Enron profited from a climate of regulatory laxity that it helped to dictate. Mr. Lay and other Enron executives met several times last year with Vice President Dick Cheney, who was heading the president's energy task force. Mr. Cheney is still stonewalling congressional efforts to find out what happened in those meetings.
But the task force recommendations for "reforming" the utility regulation law to provide "greater regulatory certainty" (read: deregulation) could have been written by Enron. Enron helped create what some called a regulatory "black hole."
The Bush White House was deeply penetrated by a company that became the nation's seventh-biggest corporation not by making energy but by making deals. Economic counselor Lawrence Lindsey had been a paid adviser. Political strategist Karl Rove had been a big investor. Republican national chairman Mark Racicot had been a paid lobbyist. Lay himself had been on an early list of possible cabinet appointments.
So much influence did Enron wield with the Bush administration that Lay could tell Curtis Herbert Jr., chairman of the Federal Energy Regulatory Commission, that he would be reappointed if he changed his views on electricity regulation. Mr. Herbert didn't, and he wasn't.
Congress was not left untainted. More than two-thirds of the Senate and 40 percent of the House benefited - if that's the word - from Enron money, some of which is now being returned by embarrassed lawmakers of both parties.
The $5.8 million in campaign donations from Enron sources since 1989 appear to have been a good investment. The tax rebate provision of the House-passed economic stimulus package alone would give Enron $254 million.
The consequences of Enron's penetration of the United States government remain to be investigated by anyone left in government who doesn't have to recuse himself. Some day we may know whether Enron would have been able to bilk employees, investors, and a nation, were it not for that regulatory black hole that it bought for itself.
Enron is not unique in the annals of lobbyist interests prevailing over the public interest. From contracts for unneeded weapons to a banana trade war, the decisions tend to come out in favor of the big contributors. What makes the Enron story different is the drama of the huge implosion in full view of thousands of victimized employees and investors.
Daniel Schorr is a senior news analyst at NPR.