May 25, 2006

Enron-like Scandals: Ponzi Scheme & Three Card Monte

Is it just a slight of hand, or do Americans need to pay more attention?
Forty-five and 185 years for Ken Lay and Jeff Skilling respectively would be too long of a sentence for the top executives of Enron, therefore, I’d like to see something more reasonable, say, 25 and 45 years respectively. I’m taking into account their age, so by age 90 or so, they could apply for probation. However, these two scam artists should not only be sent to jail immediately [sentencing will take place Sept. 11th] but to cells with power outages, with no guarantee of a meal every day. Wouldn’t this be a proper fitting, to suffer the effects of their actions? Millions of people were left in the dark, others paid billions in inflated energy bills, and many others lost their pensions and investments because of the actions of these two. Enron along with WorldCom will go down as two huge bankruptcies that adversely affected millions of Americans.

There is a greater point here, that is, the market forces are not infallible! Capitalism has indeed contributed to the economic betterment of people. Even Carl Marx in this Communist Manifesto lauds capitalism. However, there’s no pure capitalism today; hasn't been since the early stages of the industrial revolution in the 1700s. So, the question is, how much regulation and overseeing is necessary to achieve a balance between cost & benefit. I assume that we generally accept that the laws of the market forces not only aren't enough but may be harmful to the common good. My company can greately benefit if I discharge my factory's toxic pollutants into the adjacent lake so I don't have to pay for proper disposal. My fleet of fishing boats can take the last fish out of the water, and my timber company can cut down the last tree, etc.


We also have to take into account that the Enrons, the Exxons, the Haliburtons, the Bechtels, the whatever company receive tremendous benefits from the law, the tax code, the overall strength of the U.S., and the general business environment they operate in. They do not operate in the vacuum of space and they didn't not create the world and their workers & customers from scratch. In other words, they're taking advantage of the existing conditions that were created by a myriad of factors and actors over a long period of time.

I still can't fathom the greed by persons who have so much to begin with. We may look down upon people who broke the law by emigrating illegally in order to make a living, to better their lot, by working hard and being contributing members to our society. Yet, we tend to pick on those more visible and most probably lesser trespasses than to carefuly examine what's going on behind closed doors where billions of dollars in transactions take place. The energy bill was agreed in this manner by the Vice President and the oil/electricity/coal top executives.

Many Americans who vote against their economic interests by voting primarily for the Republicans aren't paying much attention to the details. Admitedly, it's easier to see the local bum who may be abusing the welfare system, spending food stamps on ..marshmellows, etc. Everyone knows of someone who cheated on taxes or somewhere along the way. However, the biggest cheats aren't well known. Who got the biggest tax cuts and a big transfer of wealth [guess which way] while the country is at war? Isn't a scandal that the first thing the Republicans wanted to do after coming back from vacation following the Katrina disaster was to repeal the estate tax, you know, to benefit the Paris Hiltons, affecting less than 1% of Americans! And, most Americans are for it eventhough they'd never, ever, be affected by such a law! Lottery tickets anyone?

So, what is the role of the government? Who do we elect to represent us? What price do those who betray the public's trust & interest pay? Are politics independent of the people or to what extend do they reflect the collective psyche?

One thing for sure, Americans often don't vote reality but their dreams! And, then they complain for getting a Bush that they asked for in the first place!

6 comments:

anderson said...

Ken was a close buddy of Bush, so don't be surprised if Bush pardons him!

Idetorod said...

The role of the government is to protect us and provide us with a more even playing field.

Geeshus said...

Did you notice how those convicted fellons said that God is playing an active role in this?....

I don't know about you, but I'm experiencing some joy thinking that these two scumballs will join the most on of the most religious groups in the US: the prison population!

oliver said...

Do you know how many people won't be able to retire because their pensions disappeared under those 2 f@ckers' criminal activity?

There's inherent risk in investing in the marketplace but at least we expect to invest in legitimate companies--that there's some kind of regulation and supervision by the gov--and not in a pyramid scheme.

sam said...

I think the prosecutors did a brilliant job. They did not include all the possible charges against this Enron duo. It would have been too complicated for the jury to hear all the details of their scheme. Instead, the prosecutors took their time and picked & chose what charges to bring. In the end it was easier to prove that Lay & Skilling lied, cheated, and their intent was to deceive the public and steal money.

Anonymous said...

That's why I have a problem with the conservatives and the libertatians.... both want a very small, almost powerless state....

Unless, of course, the Cons/Repubs stand to reap great benefits by getting the support of gov....