by Matt Taibbi
Bush haters are celebrating this week as old villains descend to the death chamber, but they should be careful what they wish for. Trusting Washington to fix itself is a whole new kind of torture.
Generation Enron
In George Bush’s America, the only crime is being poor
February 23, 2006
Tuesday morning, January 31, Houston. I’m in the press listening room of the Enron trial, trying to keep track of prosecutor John Hueston’s opening statement. The bespectacled inquisitor is trying, vainly, it seems, to explain to the jury an Enron investment vehicle called Raptor.
“Now imagine that you’ve driven a brand-new truck worth $30,000 into sort of a big barrel,” he says. “The truck drives around in that barrel for a while, then finally crashes and burns and ends up in a heap. Now the truck is only worth $5,000, but Enron is still saying it’s worth $30,000. That’s Raptor . . .”
I sigh and write in my notebook:
Enron: Big rubber barrel full of trucks
Trucks = shitty investments
“You will hear,” Hueston continues, “that they were able to put almost anything in that barrel . . .”
I look back at my notes. Less than fifteen minutes ago, in another prosecutorial scenario, Raptor was a cookie jar. Now I’m wondering: Was it a rubber cookie jar? Were there cookies in the barrel? If so, what size were the cookies, relative to the trucks? Covering the Enron trial is like being trapped in the world’s longest Thomas Friedman column, a Salvador Dalí landscape of violently mixed nightmare metaphors. I shudder, my pie rising.
It was inevitable that the Enron trial would devolve into a verbal jumble. For the defense, obfuscation would be necessary; in order to keep the jury away from the facts, there had to be a lot of talk about steady hands at the helm, sheep running from wolves, and other such self-serving, incoherent bullshit. Therefore, in their opening statements, the defense counsel wasted no time in blinding the jury with crap imagery like “You might think of the admiral of the navy as the CEO . . . An economic storm was raging . . .”
The prosecution had the opposite rhetorical challenge. On the one hand, it had to present to the jury an easily digestible tale of corporate fraud and insider dealing, and indeed it focused heavily on evidence that defendants Ken Lay and Jeffrey Skilling had dumped millions in company shares just before Enron’s meltdown.
On the other hand, it had to illuminate the fantastic tale of a major public corporation that hid assets and losses in hundred-million-dollar shell companies named after Chewbacca from Star Wars, did side deals with phantom companies registered in the name of an officer’s gay lover, and made billion-dollar bets on the Brazilian energy market without remembering to figure in the exchange rate in its calculations. Describing the corruption of Enron is like describing distances in the universe: impossible to express in rational numbers. Hence the barrels and trucks and cookie jars.
All of which set the stage for the Houston trial: two judicial contestants, both speaking in riddles, taking turns trying to explain one of the biggest piles of bullshit in human history.
By all rights, the trial of former Enron chiefs Ken Lay and Jeffrey Skilling ought to be a benchmark moment in this particular era of America’s history, the cathartic burning at the stake of two infamous villains who together flamboyantly represented the tragic character flaw of our fallen society at the turn of the century.
And that’s exactly what it might have been, if this trial had taken place a few years ago, at the peak of public outrage, when the sensational show trial and legal mauling of any close friend of George Bush’s seemed a remote and unlikely possibility. In the first year or so after the coinciding events of 9/11 and the Enron meltdown, the Bush-Cheney-Rove clan seemed unstoppable, with poll numbers through the roof and plans for an insane new war marching inexorably toward realization. It seemed like we would never get our hands on the likes of a Lay and Skilling; the bastards will get off was the prevailing wisdom of anyone who felt himself to be on the wrong side of flag-waving, Clear Channel America.
Some three years have passed since then, and a funny thing has happened in the meantime. Lay and Skilling are finally ascending to the gallows, but no one cares, because the brazen impunity of their particular class of wheeler-dealer con artist is no longer a shock. In fact, in the past three years the national tableau has become positively filthy with wreckage from the high-speed flameouts of similarly hyperenterprising liars and cheaters. The corporate captains, the Rigases and the Kozlowskis, went down first, but then there were others, representing other fields: Jayson Blair and Judy Miller headlined an unpleasantly teeming bunch of lying-ass journalists, and then came Jack Abramoff, and Tom DeLay, and Karl Rove himself, and Scooter Libby, and Bob Ney, and that asshole memoirist Frey . . . and by now who even cares who else?
The theme of all these stories was almost exactly the same: the sociopathic pursuit of naked, narrow self-interest, executed not only without any regard for any broader consequences but without any understanding that such consequences might exist. The thread linking Lay and Skilling with Abramoff and DeLay and Miller and even Michael Jackson was their failure to see or admit, even after being caught red-handed, that they had done anything wrong.
They were just doing what any of us would do, given the opportunity: taking as much money or fame or power or influence or little boys plied with Jesus juice or whatever as they could get, and fuck everyone else, because that’s the name of the game. Outwit, outplay, outlast—and cheat if you have to, because it’s a jungle out there. Anyone who says otherwise is just a sore loser, whining about not being let into the club.
When Daniel Petrocelli, Skilling’s grating and pompous solicitor, made his “my client is just a simple caveman” pitch to the jury, he argued with a straight face that rich people are more perfect and less prone to temptation than the rest of us.
“In 1999, [Skilling] had more money than he ever dreamed of having,” he said. Indeed, Skilling and Lay walked away with $150 million and $220 million, respectively. “So why would he do it? What is Jeff Skilling’s motive?”
There was silence for a moment, and I kept waiting for some enraged citizen to leap out of the jury box, tackle Petrocelli, start pulling ligature out of his neck. The obscenity of the lawyer’s argument defied description, but it also expressed the mind-set that led to Enron. In Skilling’s world, being poor was the only real crime; at any rate, being poor made you more suspect than someone with $150 million.
The Enron scandal, from the very beginning, was always about men not being satisfied with mere riches. The Lay and Skilling story is the story of a company with a simple, comprehensible, and highly successful pipeline business that was hijacked by economic revolutionaries desperate to break free of the old reins of traditional business. Their innovation was a gibberish algorithm that allowed them to will themselves to vast riches simply by saying they had them. The idea that there should be any limits offended these people; they wanted to be gods, with limitless wealth, and not subject to the rules of the market but actually being the market themselves. Petrocelli himself reiterated this in his opening.
“[Skilling] didn’t lead any conspiracy,” he said, his voice rising with a Dr. Frankensteinian manic tinge. “What he led was a transformation in the energy industry!”
It was the same infantile dream of omniscience, impunity, and unbounded indulgence that would eventually become the hallmark of the George Bush era. Exercising power isn’t enough; the important thing is to exercise power without having to ask for permission or compromise, à la DeLay in Congress or Bush in Iraq. And like all such revolutionaries, Skilling and Lay would go to the firing squad professing True Belief; it was clear that the righteous cause was their whole defense.
“This is not a case of ‘hear no evil, see no evil,’” said Petrocelli. “This is a case of there was no evil at all!”
Before the trial, there was much discussion of how the two defense teams—in whom the defendants are said to have invested some $38 million to date—would interact. Rumors spread that there was friction between the Skilling team, led by the fat-faced, heavily moussed Californian Petrocelli, and the Lay team, led by the legendary Texas criminal lawyer Mike Ramsey, a likable character with a homespun-hayseed demeanor. The two teams had clashed over how much to blame Enron’s collapse on already convicted ex-CFO Andy Fastow, and how much ignorance the defendants should plead about the affairs of the corporation they ruled.
As it turned out, the two basically divvied up the work right down the middle, each articulating half of the defendants’ psychotic formula for self-apology. Petrocelli spent most of his time arguing that Lay and Skilling were too rich to break the law and that Enron, far from being a criminal enterprise and a cheap Ponzi scheme in a $10,000 suit, was a brilliant and innovative company that was a gift to the world until it wasn’t.
Ramsey, meanwhile, handled the negatives, explaining Enron’s collapse as a freak accident brought on by a stock-market phenomenon identical in its unforeseeability to a whole city full of people flushing their toilets at the same time. He then provided an unseemly window into the conscience of the rich by making shameless repeated mention of the large amount of money Lay gave to charity (“$25 million, ladies and gentlemen, $25 million!”), as if this somehow justified his and Skilling’s gluttonous pursuit, using all manner of lies and bluster, of every last dollar on Wall Street.
But it was in a seemingly offhand comment in the middle of Ramsey’s oddly lyrical address that the defense made its bravest admission. While Petrocelli’s speech was nothing but a bald and unrepentant “We didn’t fucking do it,” Ramsey’s speech from the beginning promised to answer the jury’s inevitable questions and suspicions that something, indeed, was rotten at Enron. The lawyer seemed to understand that the public craved some evidence of introspection and self-examination on the part of the Enron heads, and he gave it in a quiet line at the start of his address.
“Failure,” he said, “is not a crime.”
He paused. It was a big deal, psychologically, for high-rolling lifetime winners like Lay and Skilling to admit to being failures. But that was all they were willing to admit, and they certainly wouldn’t admit to doing anything wrong. Moreover, Ramsey sabotaged his own line about failure with a “joke” that was clearly designed to show he didn’t really mean what he’d just said.
“Failure is not a crime,” he repeated. “If it was, we’d have to turn all of Oklahoma back into a penal colony—heh, heh.”
The courtroom didn’t laugh with him, not a peep from anywhere in the room. This is how Ken Lay asks for forgiveness—by calling all of Oklahoma a bunch of losers?
Just a few hours after counsel finished their statements, President Bush strapped it on for the State of the Union address. Five years ago, Enron emerged out of the ashes of a worldwide market meltdown, an economic storm that shook out the ugly truth. Now Bush is himself holding on for dear life in the middle of a comparable political catastrophe: disaster abroad, indictments pending, whole sections of his administration burning with investigatory fires. The latest nightmare involves an NSA eavesdropping program in which the president’s defense is going to be the limitless authority of the chief executive in times of war. In his speech, a clearly pissed-off Bush addressed the issue.
“Previous presidents have used the same constitutional authority I have and federal courts have approved the use of that authority,” he said. “Appropriate members of Congress have been kept informed . . .”
The dream of unlimited power dies hard—if it dies at all—in an America with nothing else to live for.
How to Be a Lobbyist Without Trying
A personal journey into Washington’s culture of greed
April 6, 2006
In January, I was in Washington, D.C., interviewing an activist from a political watchdog group about Abramoff-related stuff.
“I’ll tell you who’s got a lot of balls,” he said to me. “Senator Conrad Burns. He talked about his lobby-reform plan today, but check it out, he’s throwing a thousand-buck-a-plate birthday party for himself tomorrow night. I’m surprised he didn’t show up on the Hill today in a fucking Hamburglar costume.”
The activist handed me a printout with the details: “Please join us for Senator Burns’s Birthday!!!” It was $1,000 a ticket for organizations, $500 for individuals. RSVP Amy Miller, the Bellwether Group.
It sure would be interesting to go to that party, I thought.
“So go to the party!” said my Friend in Politics. “Just say you’re a lobbyist and go. Who’s stopping you?”
We hashed out a plan. All I needed to do, he said, was print out a few business cards, and maybe—for just-in-case verisimilitude—type out a jazzy-looking fact sheet with a plan for some bogus project my “clients” would be pushing. “But make it as ridiculous as possible,” my Friend insisted. “The magic words are: ‘My clients will be seeking some regulatory relief’ and ‘Our project has an energy-independent profile.’ Trust me, a guy like Conrad Burns will pop a boner in ten seconds flat.”
Jack Abramoff would later tell reporters that he and his team got “every appropriation we wanted” from the staff of Senator Conrad Burns, who sat on a number of important committees, including Indian Affairs and Energy and Natural Resources. Overall, Abramoff gave more to Burns than to any other politician. Though Abramoff would later claim that he himself was the “softest touch in town,” in reality he probably meant he was the second-softest, after the wrinkly senator from Montana. Burns, a mean-spirited dipshit, is one of dozens of craven morons whose presence has only recently been detected, with the aid of the Abramoff scandal. Among other things, reporters combing through his record found that he once answered “[It’s] a hell of a challenge” to a Montanan supporter who asked how he could live in Washington with “all those niggers.”
My fact sheet was headlined crude oil in grand canyon national park. It had a nice picture of the Grand Canyon on it. I was going to be Matthew Taibbi, Government Relations adviser for Dosko, a fictional Russian firm representing various energy interests, including a fictional oil company called PerDuNefteGaz that wanted to drill for oil in the Grand Canyon. My friend ratified the plan as the perfect lobbyist’s pitch: shady foreign company seeking to violate, with a long metal phallus, America’s most sacred natural landmark. I’d be welcomed with open arms, he said.
I called the Bellwether Group to reserve a spot at the party. A girl named Monica swallowed my introduction but added a warning.
“We’re expecting some protesters tonight,” she said. “I thought you should know.” “Protesters?” I said. “Gosh, what for?”
“It’s a long story,” she said. “We’re expecting . . . two people in Jack Abramoff costumes.”
“Oh, that’s ridiculous,” I said. “People have to grow up.”
“I know, it’s silly,” she said. “Well, see you tonight.”
By the time I showed up at the small reception hall, the angry mob that had been there at the reception had dwindled to a few sorry individuals shivering in the cold weather. I slithered past them unnoticed.
The schmoozefest was on. There were about fifty people present, all in suits and all with name tags representing everyone from the NRA to Motorola to the White House; they all started furiously shaking one another’s hands and gaping at one another’s name tags, like dogs sniffing each other in a Central Park run. I accosted a young girl named Kristin, who was wearing a Burns name tag, and explained who I was and what I wanted, stammering out the phrase “seeking regulatory relief” and mentioning oil in the Grand Canyon.
“You need to talk to Chris Heggem,” she said.
She led me across the room and passed me off to an early-fortyish woman with dirty-blond hair who wa
s busily engaged with three other suits. “This is the person to talk to,” Kristin whispered. “She handles all of the energy and commerce and . . . the energy and commerce and, uh . . . environment.”
When Heggem was finally free, I introduced myself. “I work for Dosko-Konsult,” I said. “We’re a Russian company. We represent a number of Russian energy companies. Specifically I work with a company called PerDuNefteGaz.”
“What?” she said, leaning over.
“PerDuNefteGaz,” I said. “It’s a Russian oil company . . .”
“Oh, yeah,” she said. “Yeah, of course.”
I suppressed a laugh. My Friend in Politics had told me that everyone I met at the party would pretend to know the company I worked for. “PerDuNefteGaz” translates roughly as “FartOilGas.”
I pressed on, stammering through a researched speech about my client’s discovery of an “abiogenic theory of petroleum recovery” and some new surveys we’d been conducting. A sharp woman, Heggem was right there with me, even when I stopped making sense. “Basically you’re using new technology, new recovery methods,” she said.
“Exactly,” I said. Then I laid it on her. “We’re pursuing a number of projects,” I said. “Including one that would involve some exploratory drilling in Grand Canyon National Park. Now, obviously this is complicated but . . . at some point in time I was hoping we could sit down and I could tell you a little more about our company and our energy-independent project.”
