Source: Common Dreams.
Published on Saturday, December 22, 2001 by Counterpunch
Enron and the Green Seal
by Alexander Cockburn and Jeffrey St. Clair
The fall of Enron sounds the death knell for one of the great rackets of the past decade: green seals of approval, whereby some outfit like the Natural Resources Defense Council or the Environmental Defense Fund would issue testimonials to the enviro-conscience and selfless devotion to the public weal of corporations like Enron. These green seals of approval were part of the neoliberal pitch, that fuddy-duddy regulation should yield to modern, "market-oriented solutions" to environmental problems, which essentially means bribing corporations in the hope they'll stop their polluting malpractices. Indeed, NRDC and EDF were always the prime salesfolk of neoliberal remedies for environmental problems. In fact, NRDC was socked into the Enron lobby machine so deep you couldn't see the soles of its feet.
Here's what happened.
In 1997 high-flying Enron found itself in a pitched battle in Oregon, where it planned to acquire Portland General Electric, Oregon's largest public utility. Warning that Enron's motives were of a highly predatory nature, the staff of the state's Public Utility Commission (PUC) opposed the merger.
They warned that an Enron takeover would mean less ability to protect the environment, increased insecurity for PGE's workers and, in all likelihood, soaring prices. Other critics argued that Enron's actual plan was to cannibalize PGE, in particular its hydropower, which Enron would sell into California's energy market.
But at the very moment when such protests threatened to balk Enron of its prize, into town rode NRDC's top energy commissar, Ralph Cavanagh, Heinz environmental genius award pinned to his armor and flaunting ties to the Energy Foundation, a San Francisco-based outfit providing financial wattage for many citizen and environmental groups that work on utility and enviro issues.
Cavanagh lost no time whipping the refractory Oregon greens into line. In concert with Enron, the NRDC man put together a memo of understanding, pledging that the company would lend financial support to some of these groups' pet projects.
But Cavanagh still had some arduous politicking ahead. An OK for the merger had to come from the PUC, whose staff was adamantly opposed. So, on Valentine's Day, 1997, Cavanagh showed up at a hearing in Salem, Oregon, to plead Enron's case.
Addressing the three PUC commissioners, Cavanagh averred that this was "the first time I've ever spoken in support of a utility merger." If so, it was the quickest transition from virginity to seasoned service in the history of intellectual prostitution. Cavanagh flaunted the delights of an Enron embrace: "What we've put before you with this company is, we believe, a robust assortment of public benefits for the citizens of Oregon which would not emerge, Mr. Chairman, without the merger."
With a warble in his throat, Cavanagh moved into rhetorical high gear: "The Oregonian asks the question, 'Can you trust Enron?' On stewardship issues and public benefit issues I've dealt with this company for a decade, often in the most contentious circumstances, and the answer is, yes."
Cavanagh won the day for the Houston-based energy giant. The PUC approved the merger, and it wasn't long before the darkest suspicions of Enron's plans were vindicated. The company raised rates, tried to soak the ratepayers with the cost of its failed Trojan nuclear reactor and moved to put some of PGE's most valuable assets on the block.
Enron's motive had indeed been to get access to the hydropower of the Northwest, the cheapest in the country, and sell it into the California market, the priciest and-in part because of Cavanagh's campaigning for deregulation-a ripe energy prize awaiting exploitation.
Then, after two years, the company Cavanagh had hailed as being "engaged and motivated" put PGE up on the auction block. Pending sale of PGE, Enron has been using it as collateral for loans approved by a federal bankruptcy judge.
Enron is best known as George W. Bush's prime financial backer in his presidential quest. But it was a bipartisan purveyor of patronage: to its right, conservative Texas Senator Phil Gramm; to its left, liberal Texas Democrat Sheila Jackson-Lee (who had Enron's CEO Ken Lay as her finance chairman in a Democratic primary fight preluding her first successful Congressional bid; her Democratic opponent was Craig Washington, an anti-NAFTA maverick Democrat the Houston establishment didn't care for).
Today some House Republicans want to treat the Enron collapse as a criminal matter, while Democrats have been talking in vaguer terms about cleaning up accounting rules and plugging holes in the regulatory system. The inability of Enron's employees to sell company stock from their 401(k)s while high-ups absconded with millions may doom Bush's promised onslaught on Social Security. There are many morals in Enron's collapse, and the role of that green seal of approval should not be forgotten.
This is the kind of crap that happens when government gets control of private property. How could an average voter know enough to hold any politician accountable for a maze like this? Where do voters go in a two-party system when both sides are dirty? Is politics supposed to be a question of which side is more guilty of crimes? Just because it has been going on for 175 years makes it legitimate? It certainly isn't constitutional. WOULD THE GAME EXIST IF SOMEONE WEREN'T PAYING FOR IT, DOG GONE? Why do they pay for it?
They pay for it because they are banking upon the speculation that it is more profitable and predictable than honest competition. That's not free enterprise, it's fascism; and please spare me the claim that the NRDC is an entity that is adverse to the fossil fuel business! If you don't know better than that, maybe you should ask Mr. Rokefeller's boy, Bryson for a job so that he can show you the ropes. Now, maybe he'll succeed and maybe he won't. But I'll bet you that Ken Lay never sees the inside of a jail cell, those Grand Cayman banks he and his sponsors laundered money through won't sell him out, and someone will pick up his game where he left off for pennies on the dollar, perhaps even with Mr. Lay as an expensive consultant.
And don't get me started on the meat packers, Soros, and Western grazing regulations under the BLM. Then there's that little gambit by Tyson in the aquaculture business. You did know that he has major investments in farming salmon, didn't you DG? He's working with Glen Spain funding salmon bycatch research. You remember Mr. Spain, don't you? Now why would he be doing that? You do know that he's moving his chicken operation to South America too?
To the streets, Carrie. Start shutting things down.
With a warble in his throat, Cavanagh moved into rhetorical high gear: "The Oregonian asks the question, 'Can you trust Enron?' On stewardship issues and public benefit issues I've dealt with this company for a decade, often in the most contentious circumstances, and the answer is, yes."
I have testified in proceedings against positions taken by Mr. Cavanagh. I have had to try to undue lies spread by Mr. Cavanagh to the PNW congressional delegation. Mr. Cavanagh is an "environmental activist spokesperson." That means he lies for a living! I am sure he feels that the ends justify the means, but he still lies. Being bought by Enron is not the first time. He was bought by PG&E and by Puget Sound Energy to help both those utilities when they needed to get something special out of the their respective state regulatory agencies.
This is a tremendous amplification to the validity of your book!!! What a beautiful find. Wish I had time to say more.
"Congress shall make no law Regarding the Establishment of Commerce."
If the government would stay within the boundaries of the Constitution, this influence peddling would not be possible, nor would it be necessary.
As it is, honest businessmen learn early on that they have to grease the palmsskids at all levels if they want to stay in business. The bigger the business, the more lubricant required.
And I can certainly understand that after decades of fighting the anti-business climate in the world, some of these businessmen decide to capitulate. When they discover that in the casino of politics, the house always wins, they decide to buy the casino. They hire lobbiests, lawyers, and environmentalist "spokespeople" in droves, and play both sides of the table.
Sure, it's dishonest, it's destroying America, but a part of me says "Who can blame them?"
But then I slap myself in the face for thinking that.
The only proper function of government is to protect individual liberties, including the right to grow crops, mine, manufacture, import, export, buy, sell, and re-sell. It's none of the government's business.
But ever since Upton Sinclair wrote "The Jungle", the mob of city-folk demanded that the government "protect them". The prostitutes in Congress back then were no different that the modern version (although probably more educated and should have known better) - they did whatever was necessary to get themselves re-elected and their Oath of Office be damned.
So here we are, in a Kafkaesque State where one must get permission from the appropriate agency to do any kind of business whatsoever. Sorry folks, but America is running - not walking - down the Road to Serfdom. But America hasn't had its "Laissez Faire" moment, yet, like France did 320 years ago:
Taxes rose even as prosperity declined. Colbert's massive system of state-regulated commerce and industry had begun to collapse before his death (1683). Partly it died through the drain of men from farms and factories to camps and battlefields. Chiefly it died through self-strangulation: governmental regulations stifled the growth that might have come under less supervision and restraint, more liberty to breathe, to experiment, and to err. Enterprise found itself bound by a maze of orders and penalties; the complex mechanism of economic activity, moved by the toilsome hunger of the many and the inventive greed of the few, groaned and stumbled under a mountain of rules, and threatened to halt. So soon as 1685 we hear the cry of laissez faire, sixty-five years before Quesnay and Turgot, ninety-one before Adam Smith. "The supreme secret", said one of Louis XIV's intendants, "is to allow complete freedom of trade. Never had manufacturers and commerce so wasted away in this realm as since we have taken it into our heads to build them up by the decrees of the state"--"The Story of Civilization" by Will and Ariel Durant. Vol VIII, pg 690
America has flunked history, and will have to repeat it.
Okay, now I have a few minutes to chime in.
Except for the internationalist moguls you refer to and more on the level of typical American business operators, let me simply lend a little support on Dog Gone's side of the ledger. Not to counterdict you C.O., but to rationalize just a bit.
I tend to believe that in self-defense, so-called business leaders are only trying to survive the current onslaught of over zealous liberal groups and are becoming ruthless reactionaries out of dire necessity. They are no longer leaders with a long view for their worthwhile endeavors for their companies and their investors and employees.
They must react to the current climate that is destabilizing almost everything economic and they can count on very little help from government at any level to stop interfearing! Even CalPers has issued a listing of companies that are on their sh!t list for bad "Corporate Governance!"(even though they were one of the special secretive partners with Enron!)(Hipocrites!)
It's all boiling down to this... The prime directive for everyone in big government, big business, big media, big religion, big not-for-profit NGO's or anyother big players, is only to "look good!" It's all becoming a huge PR battle!!!
The big legal and big accounting professions are being enlisted to the point that they are manurevering control and CEO's are no longer leaders, but tormented followers of untrustworthy advisors!
Now on a local scale, farmfriend had someone tell her that as a local government elected that I had "sold out!" Well, after years of building a business that served employers and seeing what torment government at all levels was/is dishing out to the free enterprise/free market system here in the Sierra Western Slope, I decided to get involved to try and stop a severely restrictive and anti-free market County Master Land-Use Plan and a bunch or other anti-anyother-business-but-whitewater-rafting stuff put forth by the UC Berkeley Commie Crowd!
Now C.O., you join the demonization of commercial land developers in your fantastic book. Some of the greed you label them with is true and some is pure crap! Some are so over their heads in the game and are the first to go under with the first blockade of their project. I ask you, how does any good, reasonably regulated growth of a local economy occur without the incentive of relief of severe over-regulation for ANY developer?
I ran on the platform of jobs and economic progress. Yes, I soon learned I couldn't raise enough to put out enough mailings unless I accepted money from any legitimate source. And since you can't achieve a good jobs/housing balance in any plan to guide growth without some developers to control, you adopt the Jesse Unruh philosophy of (clean version) if you can't take their money and still vote against them, you shouldn't be in politics.
My point is... citizen politicians at any level can actually want to stop the de-freemarketization that's going on, but the cynical demonization and conclusion jumping that even you casually engage in, along with the guy that told farmfriend I sold out, discourages anyone from ever trying to break the cycle of cynicism. Thus business does lose it's voice and like atmospheric pressure... The North Wind Doesn't Blow, It SUCKS!!!
It just gets worse. The minute ANY business, church, government or other "leader" blunders. They set off a feeding frenzy in the media and freedom is always the loser!