Capitalizing on the Death of Ken Lay

Since it is that empty week between Christmas and New Year’s, I’ve been trying to catch up on some reading. Specifically since I launched my new PR endeavor, I’ve been catching up on old posts from other blogs and whatnot. That might have been a mistake. I stumbled over the awesome Bad Pitch Blog, whichfeatures this train wreck of bad taste. The flak was attempting to draft off the news of Ken Lay’s death and sent this monstrosity:

From: Dave Overton
Sent: Wednesday, July 05, 2006 12:27 PM
To: Beucke, Dan
Subject: [NEWMANPR] – Why the demise of Ken Lay?
Dan,
One of the top reasons why CEOs get fired is “Denying Reality.” In milder cases, a CEO will quit rather than let a horrible truth puncture their fantastical views. Or they’ll blame their workers or board. They’ll craft all sorts of psychological defense mechanisms to avoid shouldering culpability.

One could argue in Lay’s case that the truth he would be forced to confront (bankrupt company, displaced workers, destroyed nest eggs, prison, etc.) was so horrible, and so unavoidable, that his body simply shut down rather than confront a terrible reality.

Lay’s death may be the equivalent of a child sticking their fingers in their ears to avoid hearing something bad. But a lot more final.

Mark Murphy is CEO of Leadership IQ, a Washington, D.C. based management consulting firm. Mark has some interesting thoughts on the demise of Ken Lay and how others can avoid his fate.

Please let me know if you would like to speak with him.

Thanks for your time.

Oh my goodness. In addition to the frankly hideous writing, this is just so classless it would poison me from ever wanting to interact with him. Ever. Ever ever ever.

Mark has some “interesting thoughts” on the death of Ken Lay?

I am sure that whatever these “interesting thoughts” are, they are probably cheap because they’re recycled all over the internet and through-out print media. This Mark person needs to hire a better PR firm. Just yuck.

Committing The Enron Mistake

An article at Big Think has some of the absolute worst investment advice I have ever heard.

Ackman asks how can you avoid loses and earn an attractive return over time? Ackman’s answer is that you don’t want to be jumping from one company to the next. Instead, Ackman says, pick a company that you can own forever. In other words, if the stock market were to close for 10 years, you’d be perfectly happy with this investment.

You mean like putting all your money in Enron stock? This is just plain horrible advice. If anyone tells you to lock in your stock with one company forever, run. And I was careful about this. I re-read it several times, thinking surely nobody can be this careless after Enron. But it specifically says, “you don’t want to be jumping around from one company to the next.” Which means you want to keep a really narrow portfolio, which means you’re going to end up holding the bag when that company tanks.

Don’t do it! Remember Enron!

How To Make My Christmas Merry

This year, for the first time, I want some reciprocity. As I was shopping for gifts, I was also thinking what I want from certain Enron people. So this is what you can do to make my Christmas extra merry.

Gary Mulgrew. I want him to call me – from Scotland – and recite the poem “Daddy” by Sylvia Plath. It is very important that he actually be in Scotland. It is not enough that he is Scottish, he must be located in Scotland when this happens. Furthermore, I have a very complicated relationship with the Scottish accent. I barely understand it and yet it drives me crazy! Have you seen A Fish Called Wanda? Remember how Wanda went crazy at the sound of Russian? That is how I feel about the Scottish accent. I chose that poem because it is my favorite poem, though not particularly suited to a masculine reading it, nor a Scottish accent. I think that can only increase my enjoyment of it. After writing this out, I am starting to wonder if perhaps I too am difficult to shop for.

Rex Shelby. I would like some of your patience and stamina. You fought the DOJ for eight years. I figure you have stamina to spare.

Giles Darby, I ask that you force Twiggy to return to England.

And last but not least, I want a joint gift from Jeff Skilling, Ken Rice and Kevin Hannon. I want them to remake this video, and I’d like Eminem to replace T. Pain.

I give so much and ask for so little.

In all seriousness, my best present is that I get to write about something I care so much about. I hope that everyone has a Merry Christmas or Happy Hanukah!

Merry Christmas, Enron

It is time to give out my annual Christmas wishes. So:

To Jeff Skilling, I give freedom. I give him the ability to go wherever he wants, see whomever he wants, and never look back. I give him the company of civilized women and men, and I restore to him the full range of his experience and emotions.

I have two presents this year for Ken Rice. First, a motorcycle. To my amateur eye, this one looks quite amazing and innovative and super fast.

Secondly, since we know that he loved Ferraris while at Enron, I found a way that he can keep one close to him forever. A crashed Ferrari smashed down into a coffee table:

After his prison sentence, Kevin Hannon pretty much vanished off the radar, but I don’t think he’s really gone. I keep expecting to hear that he has done something amazing. So for the man who, in my imagination, is always arriving, I give a Gulfstream g650.

To Rick Causey, I give a lifetime membership to the Trump International Golf Club in West Palm Beach, Florida.

The formidable Gary Mulgrew is quite difficult to shop for. What do Scottish people like? And what would he like? I’ve come to the conclusion that every Scot must have a castle from which to fight the English to save the English from the English. Is that not what makes you a Scot in the first place? Therefore, I give you Skibo Castle. I hear it freezes winter, so do bring thermal underwear.

David Bermingham, being English, owns the whole world. Empire much, David? But since I do love the English, I give a promise that we will stop sending semi-talented American movie stars to England and letting them adopt horrible faux-English accents. Oh, and also, you can have Spain.

For Giles Darby, who seems like the quintessential English gentleman, I give tea with the Queen.

To Rex Shelby, I give an adorable puppy.

To Joseph Hirko, I give the Hawaiian phrase for “you’re my hero.” And a small Hawaiian island.

To Scott Yeager, I give a velvety quarterhorse.

To William Fuhs I give a satellite named after you.

To Tim Belden, I give LL Cool J who will sing “Going Back To Cali” anytime you wish.

Detailed Responses To Lay It On The Line Survey

I have a giant folder of Enron stuff. I really do need to find a better way to organize it. I feel a bit overwhelmed when I see ten thousand documents or whatever. Today I just randomly opened a PDF and was surprised by what I found.

These are answers to the Lay It On The Line survey, organized by executive. In other words,comments made about Andy Fastow, Greg Whalley, et cetera are aggregated. I don’t know quite what to make of this yet. My first impression is that it reads like a bunch of very catty people unloading all their grievances. For example, the comments under “Greg Whalley” sound like they were written by a high school sophomore. Under Ken Lay, someone complained about the carpet. After I read a bit more, I’ll have a better opinion but right now it just seems like BLAH BLAH BLAH BLAH BLAH.

Lay It On The Line Survey Results

Unemployment Rate Falls To Lowest Since… Ken Rice!

This is why the Chron is not very well respected anymore for hard news. They often make mistakes like this. As of right now, it is an article about the unemployment rate with a picture of Ken Rice. Why? I don’t know.

No, Scott Yeager Was Not In Smartest Guys In The Room

This query has been asked at least fifteen times, probably more like twenty-five. Here are a few:

(This one I included because it has a very strange search term about Kevin Hannon)

Whoever is asking is obviously in distress so I figured I would help. No, Scott Yeager is not in Smartest Guys In The Room. As for why he was not “cast”… basically nobody accused of crimes was going to willingly sit down and explain themselves before trial. And the fact that “cast” is being used sounds like my pet peeve, mistaking Enron people (or anyone else for that matter) for cartoons and “characters”.

As for why Scott did not “appear” in the movie (as opposed to being “cast”), not every Enron executive was discussed in the movie. In fact, most Enron defendants did not appear. Only Ken Lay, Jeff Skilling, Ken Rice, Timothy Belden* and Andy Fastow were actually discussed in the movie – and what was said about them was koo-koo bananas. I’ve documented all those lies here. Scott Yeager would have ultimately destroyed the credibility of Bethany McLean since he was vindicated at the Supreme Court. Bethany and her cohorts chose to focus on the lurid, manipulatable aspects of Enron.

I hope this has helped.

*Corrected from original to include Timothy Belden.

Random Thoughts About Enron

* Discussing the finances of Enron executives – or anyone, for that matter – is an effort to judge them. If they made $50,000 per year, would you have a different opinion of them? What if they were on welfare?

* What did Enron executives make? They made the world better. They made the Cloud that you so casually use to store your videos and music. Yep, that was Enron. They made the gas bank, which helped drag Houston out of a recession. They made markets which made money that would trickle down to your wallet when you were standing in line at the grocery store, buying milk and butter for your wife so she can make you some biscuits in the morning. They made history. What do you make?

* Fewer than twenty people were mentioned in Smartest Guys In The Room. Many were not even Enron executives. Yet those twenty people became mouthpieces for all that was supposedly wrong with a company that employed 20,000 people around the globe. It isn’t rational.

If I Were Queen Of The Internet: A Prose Poem

If I were Queen of the Internet, I would outlaw every Ken-Lay-and-George-Bush-Were-Best-Buds conspiracy site on my first day in office. I would see to it that every last electron pulsing with the remembrance of those sites would be smothered. Every trace would evaporate like the contrails of a Pan-Am jet that landed in 1971.

Oh and that is just the beginning! If I were Queen of the Internet, Ungagged.net would be my Secretary of State and Houston’s Clear Thinkers would be my Attorney General. The Supreme Court would be… let’s see… Jeff Skilling and Ken Rice, Kevin Hannon and Greg Whalley, and Chief Justice Jeff McMahon. Yeah, yeah, I know that’s only five and the Supreme Court has nine. But if I were Queen of the Internet, five would be just fine.

If I were Queen of the Internet, my Royal Army would be commanded by Rex Shelby. David Berberian and Larry Ciscon and Ellis Giles and Joe Hirko and Scott Yeager would defend the Internet with all their might while I wiled away my day by the pool, getting regular Twitter updates on my iPad.

Mmm, it is good to be Queen.

If I were Queen of the Internet, every Facebook update would discuss intelligent things, and every blog would pay homage, and every stupid, inane, blathering moron would be banished to the Lower Lands. Places like AOL and Prodigy.

If I were Queen of the Internet, I would YouTube every workday, from 8-7pm, just to prove there was such thing as EBS. I would Skype with anyone I wanted, 24 hours a day, and then post the vids on http://www.queenoftheinternet. I would delete the term “enterprise solution”. I would GoogleMap Big’s moods. Hang left at cranky. Right at preoccupied. U-turn at the silent treatment, all the way back to tongue kissing, making out like teenagers, on the sofa. I would navigate every emotional intersection.

As Queen of the Internet I’d be accused of being shallow as a dinner plate, but I’d stretch for miles in every direction.

The cloud would hold all my memories, so I’d be blank and pure as a whiteboard every morning. Every day, I would be filled up at iTunes and Yale.edu and damnyouautocorrect.com.

If I were Queen of the Internet, you could email dead people. They would not email you back. But you’d get an automated reply. You’d see their name in your inbox, which is really all you really wanted. And a message saying, “I’m fine. I miss you. Now get out of here, you little scamp, you’ve got the world to create.”

Enron.com would be alive. Buffering? Outlawed forever.

If I were Queen of the Internet, you could download a hug when you’re sad, and upload your spare karma – donate it to strangers and hope they pay it forward. Love could zip through your firewalls and servers like a virus. InterAgent would be there to direct every movement for us.

If I were Queen of the Internet.

If I were Queen. My email would be QueenCara@.com. I’d be everywhere but still be mortal, I’d control the websites and portals, I’d hook myself up with a sweet, high-speed wireless. I’d really show you what the internet could do. I’d be the girl waiting, waiting to hear from you.

Enron’s Unfair Trial

This letter to the editor of the Chicago Tribune is so encouraging I can barely sit still. I have perceived a change in the public’s feelings about Jeff Skilling and Dr. Lay over the last few years. Letters like this only solidify my belief that since some of the facts about Enron have been exposed, more people are noticing that Skilling and Lay were not guilty.

Phil Rosenthal’s column about the failure of Enron (Business, Dec. 4) missed out on several interesting points in law and economics.

First and foremost, Jeffrey Skilling and Ken Lay were convicted of wire fraud even though they had no personal gain from the fraud. The Supreme Court later unanimously found the “honest services” version of fraud was too vague and ruled only bribes and kickbacks are illegal.

By contrast, Andrew Fastow, then chief financial officer of Enron, established the off-book entities where much of Enron’s debt was parked. To be legal, the off-balance-sheet special purpose entities were supposed to be independent of Enron. But Fastow did not let this happen. Indeed, he siphoned off tens of millions of dollars to his personal account by virtue of being an officer of both the partnerships and Enron.

Fastow initially indicated to the FBI that the lack of independence was not reported to Skilling. Fastow later testified just the opposite. The earlier, exculpatory testimony was kept from the defense by both the prosecution and trial Judge Sim Lake.

Skilling was convicted on only one count of insider trading out of ten charges in the indictment. According to courtroom observers, the prosecution won conviction because the trading occurred after Sept. 11, 2001, and therefore it was seen as “unpatriotic.”

Perhaps the most egregious error in the Enron case was the denial of a change of venue. Passions in Houston were running high, with so many residents and their friends having been personally affected with Enron’s collapse. In the opinion of Supreme Court Justice Sonia Sotomayor, who cannot be considered a conservative, the jury pool was most likely biased.

– Paul Fisher and Jim Johnston, directors, Heartland Institute, Chicago

Those of us who know Jeff Skilling is innocent might be a minority, but eventually our view will be justified. I am certain of this.

Men At Work

I am not entirely sure there any specific reasons I love Enron so much. I seem to have been born with a giant asteroid-sized crater in my soul, and I don’t know what that asteroid knocked out of me, but it left space that can only be filled with Enron. If I can make a stab in the dark about why, I guess it would be this: the Enron executives were the first people I’d ever known up close and personally to actually make America work for them. As an American, you are told from your first waking hours that the USA is a place where you can make your own fortune, where you can do anything you set your mind to. (I realize this go-team-go doesn’t work for the NatWest guys, which makes me wonder what the UK has instead of “land of opportunity”. Are they too inundated with that message from the cradle? Or is it a uniquely American contrivance?)

Enron executives are the opposite of raised-by-wolves. They’re kind and gentle and brilliant. They live up to the hype. Big in particular is the very model of a southern gentleman… mixed with an Ayn Rand character. He had his first job before school. There is a family story of him as a three year old, getting his father’s shoe shine kit, putting it on his red wagon, and setting up a shoe-shine place in his neighborhood. He charged a nickel per shine. He didn’t really know what he was doing; he would just kinda spit on the shoes and rub them with a cloth like he had seen his father do. Someone dropped by his house and told his mom that her son was out shining shoes. She was horrified and ran to get him. She was afraid the neighbors would think she was forcing him into child labor. But Big was happy – he said he felt very rich, rich enough to retire on all the nickels he got that day. He just loves work. If his french toast skills had not already been legendary, that story would have been enough to make me love him.

I imagine it was pretty much the same for the others. I know for a fact that Jeff Skilling worked even as a kid as young as fourteen. That kind of work ethic delights me. It makes them special.

There are a lot of cool things I can do that they can’t do though. I can do air turntable like you would not believe. Can’t picture David Bermingham doing that, now can you? I can make boys stop in their tracks by jumping on a trampoline in a sports bra. They don’t seem to have that power. But they definitely have the work juju down.

On The Tenth Day of Enron

On the tenth day of Enron
the DOJ gave to me
Ten execs in prison,
Nine false allegations,
Eight million in restitution,
Seven new indictments,
Six Raptors raptoring,
Five points off the stock,
Four favorable analyst reports,
Three Broadband executives,
Two Nigerian barges,
And a black mark on the Big E.

Jeff Skilling’s New SCOTUS Petition

At SCOTUSBlog, Jeff Skilling’s new filing is the Petition Of The Day. I have not yet read the petition for certiorari but here it is.

When Is A Conspiracy Not A Conspiracy?

It is usually counter-productive for me to check out the HuffPo because I fundamentally disagree with just about every sentiment expressed in that liberal fever swamp. Today was par for the course, but Enron was mentioned. I had to chime in.

At HuffPo, a writer is screaming for more regulation and wondering why more bankers are not in prison for the 2008 financial meltdown. The reason is simple: the bankers were making home loans available to anyone regardless of whether they would be paid back – as was dictated under the Community Reinvestment Act. The people who enacted that are in congress and congress will not indict themselves.

So the writer quotes – of all people – Loren Steffy, who has made a career out of hating business and Enron in particular:

Three years ago, I asked Sam Buell, the former federal prosecutor in the government’s effort to indict Enron’s Jeff Skilling, the question of whether we’d see widespread prosecutions from the financial crisis. His prediction: Don’t count on it. As I wrote at the time:

In the current crisis, few people understood the complex debt instruments that had become common on Wall Street and therefore the firms failed to make good risk assessments. But what they were doing — such as packaging dodgy mortgages into investment pools that were supposed to minimize risk — was widely known.

“It’s not a conspiracy if everybody’s in on it,” Buell said. “In order to have a fraud conspiracy you’ve got to have some effort by one group to deceived another group.”

But what about the fact that America as whole seems deceived by what happened? Doesn’t matter, Buell argues. Just because Main Street didn’t understand what was happening doesn’t make it a fraud. Those who are stand-ins for investor interest — regulators, brokers, credit agencies — “seem to have known what was going on,” he said.

Sometimes I am actually embarrassed for Loren Steffy. I have said stupid things too, but usually I try to keep them to a minimum. Steffy, on the other hand, proudly flaunts his stupidity like a badge of honor.
That question: “what about the fact that America as a whole seems deceived by what happened?” is just embarrassingly inane.

If that were the standard, incidentally, we would not have a federal government, particularly a Department of Defense. The ignorance of the general populous does not create the legal grounds for conspiracy – not even for the much-despised Enron.

Buell is right, of course. There was no group of people inside Enron who were trying to deceive anyone else. I’ve always marveled that according to the naysayers, Enron managed to hire people from the mailroom to the C-Suite who were criminals. Oh, and they also did business with criminals: NatWest, Merrill Lynch, Vinson & Elkins, Arthur Andersen, Citigroup and McKinsey. And Ken Rice was actually involved in two conspiracies! One in Corporate and one at EBS. And Scott Yeager was so deceptive that he not only fooled everyone at EBS, he managed to fool Jeff Skilling too! And Jeff Skilling was also involved in a conspiracy!

How exactly is this supposed to work? How was Enron able to not only hire a statistically impossible number of criminals, but also just happen to find all the other criminals in its partner organizations? Only five people went to prison for the Watergate scandal (seven were indicted). And yet, eighteen went to prison for Enron – 36 were indicted. Was Enron really that much larger than Watergate? How was it that all these smaller conspiracies were taking place inside this much larger conspiracy? The EBS conspiracy is just ridiculous. Rex Shelby, Joe Hirko and Scott Yeager didn’t know each other outside of work. Rex and Scott had worked on one project before. But why would they agree to conspire illegally with Joe Hirko, who neither one knew? And why would Joe Hirko, who is known as a gentle, kind man decide to start fucking over Enron?

At Corporate, the conspiracies are just absurd. Jeff Skilling supposedly took reserves and added it to the earnings – while at the same time hiding earnings from wholesale. Why? If Enron was in trouble, there were thousands of things he could do to fix it. Such as start cutting costs. But during that time, Enron was buying new jets. If there was a problem, they could have delayed delivery. Jeff could have written a check for millions and laundered it through Andy Fastow and his SPEs, since that’s what the DOJ says happened at Southampton with Ben Glisan, Kristina Mordaunt, and the NatWest bankers. If he and Andy Fastow were already committing multiple felonies every day, what is one more? Why not just make up the loss with a personal check? Or he could have even done it openly and bought some of Enron’s art*. Yet the man who supposedly thought up all kinds of crazy scams just didn’t bother to anything wacky to fix this supposed earnings gap, other than take reserves which was possibly the sloppiest method known to mankind.

The idea that a bunch of smart guys who were already multimillionaires got together and then started conspiring to commit fraud is just laughable. It makes no sense at all. There was no fraud or conspiracy at Enron Corporation.

*There was a story in, I think, 2007 or 2008 where a company declared in its 10-K that the CEO had bought some art from the company and had paid something like $5 million for it. I wish I could find the details, but it was on footnoted.com, which has become a Morningstar company and I can no longer find it.

The Perfect Angels of Enron (Who Are Not Really Perfect Or Angelic)

This evening I had dinner with an Enron executive who pointed out something interesting to me about my own biases. I’ve been mulling this over for hours and figure the only way to exorcise it is to write about it. It’s best to get these things over with, so here goes.

Mr. X, as I’ll call him, pointed out how I bristle when people call Enron defendants “characters” or “players” or anything that implies they are cartoon characters. Yet I write about Enron like it is an episode of Ally McBeal. There are some exaggerated elements. Where Ally saw dancing babies, I see haloes over the heads of the executives.

It is funny that he saw that I dislike something I’m doing myself, only in the opposite direction. However, I don’t think any of them were angelic, exactly. Big, in particular, is so good it makes my heart hurt. He is good in a very basic way; he doesn’t know how to be bad. He never feels the urge to be bad. He enjoys being good.

I have once in a while very much wanted to do evil things. And sometimes I have done them, though to my credit I always agonize over them later. But Big does not ever feel the need to do anything that hurts anyone, or is less than gentle and forthcoming and aboveboard and moral and right.

Last year I wrote a novel and an editor wanted some changes. Big and I stayed up all night working on those changes, and I would say to him, “Please, be brutally honest with me. How does this sound?”

Even with the invitation, he could not be “brutal”. He merely – gently – offered suggestions. He simply does not have it in him to be mean or sarcastic or anything but the graceful gentleman that he is. And yet, he is not angelic. He makes me crazy. He does things I ask him not to all the time (sleeping on the sofa, for one.) And he won’t do things I ask him for (he knows what I am talking about.) So he’s good but not angelic.

I don’t know any of the other Enron guys as well as I know Big, but I doubt any of them are angelic. I like their imperfections. I just can’t see those imperfections being taken so far as to commit felonies.