I wasn't going to write anything about
the Enron scandal, given the saturation coverage it's receiving.
Even the self-proclaimed spokesman for
the "working class," Bill
O'Reilly, seems to be following through on his pledge to devote a lot of
time to the issue (maybe he'll even wind up spending more airtime on Enron
than on the alleged financial irregularities O'Reilly maintains are rife in
Jesse Jackson's non-profit organizations!).
I was prompted to write about Enron,
however, by two things: an outrageous statement by Treasury Secretary Paul
O'Neill, and, by how shallow the corporate-owned media's analysis is when
they profess to be discussing the broader and deeper implications of this
Treasury Secretary Paul O'Neill
Companies come and go.
It's part of the genius of
Senator Joseph Lieberman, Democrat
from Connecticut, called the comment "cold-blooded." And I
immediately thought, what else could one expect from O'Neill, a kind-hearted
guy who wants to drastically slash
Social Security and Medicare, and who opposes a British plan to increase
the amount of aid given by the rich nations to global antipoverty
If O'Neill doesn't care about the
elderly and the Third World poor, he certainly wouldn't be overly concerned
that thousands of American workers had their life savings wiped out by the
Indeed, O'Neill practically spelled
out his lack of concern in a further comment:
[P]eople get to make good decisions or bad decisions. And
they get to pay the consequences or to enjoy the fruits of their
decisions. That's the way the system works.
Apparently, O'Neill believes it's a
bad decision to not be able to read the minds of Enron executives and know
they were lying about the company's economic condition.
A "Deeper" Analysis by
the Corporate Media
In an editorial,
the New York Times correctly points out that
The Enron debacle is exceptional
only in its scale. Other former Wall Street favorites have engaged in
creative accounting to pump up their stock prices. Lucent
, Sunbeam, Waste Management
are only some of the more notorious cases of companies forced to restate
previously reported earnings, causing their stock prices to crater. People
lost billions of dollars, misled by phony numbers ratified by the
The newspaper then seeks to warn of
deeper implications of the current scandal:
The public's trust in the integrity
of markets, and in the reliability of companies' disclosed financial data,
has been one of America's competitive advantages since the adoption of its
security laws in the 1930's... A majority of Americans are now invested in
the stock market, but they will not long participate in a game they know
to be rigged against them.
The way the New York Times
looks at it, the "game" would not be rigged against the majority
of Americans were scandals like Enron to be prevented in the future.
I beg to differ.
The game would be rigged against the
majority of Americans even were every executive in every company to obey
every "rule" as would an Eagle scout.
The wealthy set up the financial
structures, and they don't set them up in a manner that will cause
themselves to become poorer relative to everyone else. Quite the
The wealthy became wealthy by
devoting their time, intelligence and resources to amassing wealth. In
a game where they make the rules, the rules will favor them, and indeed will
serve to enhance their position -- that is, increase their wealth relative
This is only common sense, and in
accordance with human nature. I'll give two quick examples, first a
micro one, then a macro one.
Micro: The wealthy want to
avoid paying taxes, and the rules those like Paul "Let Them Eat
Cake" O'Neill set up are designed to let them do exactly that.
For example, O'Neill recently approved
a phony agreement with the Cayman Islands, an off-shore tax haven used to
avoid federal and state taxes, that allows the wealthy U.S. tax evaders to
withdraw their money and deposit it elsewhere before an ostensible crackdown
on them will begin!
Macro: In a system designed and
kept in force for a long period of time by intelligent people, one would
expect that the results are those that the designers intended. Since income inequality in
this country has continued to increase throughout the 1980's and the 1990's,
one must assume that's the intent of those who make the rules of this
"game." [more examples of the
transfer of wealth to the rich from everyone else]
* * *
No matter what the majority of
Americans do under the current rules of the game, no matter how accurate the
financial statements the New York Times would be relieved for them to
receive, the game will remain rigged against them, and they will lose ground
against the wealthy, garnering a smaller and smaller share of the economic
The amassing of huge profits by the
Enron executives at the expense of the workers and shareholders of the
corporation is not an instance where the overall result -- increased
concentration of wealth at the expense of the middle and working classes --
is in error. That result is the goal of the game's rules.
The Enron scandal is merely an
instance where some wealthy executives got so greedy that they weren't
content with the more-than-fair share of the country's wealth they would
amass under the "rules." They broke these "rules,"
so now the pundits are all atwitter.
The Enron scandal is simply a case
where some incredibly greedy bastards couldn't even play by their own rigged