[Mb-hair] Enron: Patron Saint of Bush's Fake News By Frank Rich

[Michael Butler]

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    Enron: Patron Saint of Bush's Fake News
    By Frank Rich
    The New York Times

    Sunday 20 March 2005

    Just when Americans are being told it's safe to hand over their savings
to Wall Street again, he's baaaack! Looking not unlike Chucky, the demented
doll of perennial B-horror-movie renown, Ken Lay has crawled out of
Houston's shadows for a media curtain call.

    His trial is still months away, but there he was last Sunday on "60
Minutes," saying he knew nothin' 'bout nothin' that went down at Enron. This
week he is heading toward the best-seller list, as an involuntary star of
"Conspiracy of Fools," the New York Times reporter Kurt Eichenwald's epic
account of the multibillion-dollar Ponzi scheme anointed America's "most
innovative company" (six years in a row by Fortune magazine). Coming soon,
the feature film: Alex Gibney's "Enron: The Smartest Guys in the Room," a
documentary seen at Sundance, goes into national release next month. As long
as you're not among those whose 401(k)'s and pensions were wiped out, it's
morbidly entertaining. In one surreal high point, Mr. Lay likens
investigations of Enron to terrorist attacks on America. For farce, there's
the sight of a beaming Alan Greenspan as he accepts the "Enron Award for
Distinguished Public Service" only days after Enron has confessed to filing
five years of bogus financial reports. Then again, given the implicit quid
pro quo in this smarmy tableau, maybe that's the Enron drama's answer to a
sex scene.

    The Bush administration, eager to sell the country on "personal" Social
Security accounts, cannot be all that pleased to see Kenny Boy again. He's
the poster boy for how big guys can rip off suckers in the stock market. He
also dredges up some inconvenient pre-9/11 memories of Bush family business.
Enron was the biggest Bush-Cheney campaign contributor in the 2000 election.
Kenny Boy and his lovely wife Linda flew the first President Bush and
Barbara Bush to the ensuing Inauguration on the Enron jet. Even as Enron was
presiding over rolling blackouts in California, Dick Cheney or his aides had
at least six meetings with the company's executives to carve up government
energy policy in 2001. Even now what exactly transpired at those meetings
remains a secret.

    But never mind. The president himself gave his word when the Enron
scandal broke that Kenny Boy was really more of a supporter of Ann Richards
anyway. Feeling our pain, Mr. Bush told us of his own personal tragedy: his
mother-in-law lost $8,000 she had invested in Enron. Soon stuff was
happening in Iraq, and the case was closed, or at least forgotten.

    Yet the larger shadows linger. Revisiting the Enron story as it
re-emerges in 2005 is to be reminded of just how much the Enron culture has
continued to shape the Bush administration long after the company itself
imploded and the Lays were eighty-sixed from the White House Christmas card
list.

    The enduring legacy of Enron can be summed up in one word: propaganda.
Here was a corporate house of cards whose business few could explain and
whose source of profits was an utter mystery - and yet it thrived,
unquestioned, for years. How? As the narrator says in "The Smartest Guys in
the Room," Enron "was fixated on its public relations campaigns." It churned
out slick PR videos as if it were a Hollywood studio. It browbeat the press
(until a young Fortune reporter, Bethany McLean, asked one question too
many). In a typical ruse in 1998, a gaggle of employees was rushed onto an
empty trading floor at the company's Houston headquarters to put on a
fictional show of busy trading for visiting Wall Street analysts being
escorted by Mr. Lay. "We brought some of our personal stuff, like pictures,
to make it look like the area was lived in," a laid-off Enron employee told
The Wall Street Journal in 2002. "We had to make believe we were on the
phone buying and selling" even though "some of the computers didn't even
work."

    If this Potemkin village sounds familiar, take a look at the ongoing
60-stop "presidential roadshow" in which Mr. Bush has "conversations on
Social Security" with "ordinary citizens" for the consumption of local and
national newscasts. As in the president's "town meeting" campaign
appearances last year, the audiences are stacked with prescreened fans; any
dissenters who somehow get in are quickly hustled away by security goons.
But as The Washington Post reported last weekend, the preparations are even
more elaborate than the finished product suggests; the seeming reality of
the event is tweaked as elaborately as that of a television reality show.
Not only are the panelists for these conversations recruited from
administration supporters, but they are rehearsed the night before, with a
White House official playing Mr. Bush. One participant told The Post, "We
ran through it five times before the president got there." Finalists who
vary just slightly from the administration's pitch are banished from the
cast at the last minute, "American Idol"-style.

    Like Enron's stockholders, American taxpayers pay for the production of
such propaganda, even if its message, like that of the Enron show put on for
visiting analysts, misrepresents and distorts the bottom line of the scheme
that is being sold. We paid for last year's phony television news reports in
which the faux reporter Karen Ryan "interviewed" administration officials
who gave partially deceptive information hyping the Medicare
prescription-drug program. We paid Armstrong Williams his $240,000 for
delivering faux-journalistic analysis of the No Child Left Behind act.

    The administration cycled the Ryan and Williams paychecks through the PR
giant Ketchum Communications. Ketchum was also one of the companies hired to
flack for Andersen, the now-defunct Enron accounting firm that shredded a
ton of documents. We don't know what, if any, role Ketchum is playing in the
White House's Social Security propaganda push, though we do know the company
has received at least $97 million from the government, according to a
Congressional report.

    That $97 million may yet prove a mere down payment. The Times reported
last weekend that the administration told executive-branch agencies simply
to ignore a stern directive by the Congressional Government Accountability
Office discouraging the use of "covert propaganda" like the Karen Ryan "news
reports." In other words, the brakes are off, and before long, the
government could have a larger budget for fake news than actual television
news divisions have for real news. At last weekend's Gridiron dinner, Mr.
Bush made a joke about how "most" of his good press on Social Security came
from Armstrong Williams, and the Washington press corps yukked it up. The
joke, however, is on them - and us.

    USA Today reported this month that the Department of Homeland Security,
having failed miserably to secure American ports and air transportation from
potential Al Qaeda attacks, has nonetheless shelled out $100,000-plus to
hire "a Hollywood liaison": Bobbie Faye Ferguson, an actress whose credits
include the movie "The Bermuda Triangle" and guest shots on television
schlock like "Designing Women" and "The Dukes of Hazzard." She will "work
with moviemakers and scriptwriters" to give us homeland security
infotainment - which is to actual homeland security what the movie
"Independence Day" is to an actual terrorist attack.

    Another propagandist with a rising profile is Susan Molinari, the
onetime CBS News personality who appears regularly on news shows like
"Hardball" and "Capitol Report." As she bloviates from the right about
Social Security or the fake newsman Jeff Gannon, she is invariably described
as "a former Republican Congresswoman" or a "CNBC political analyst." But
her actual current jobs remain mysteriously unmentioned: C.E.O. of the
Washington Group, Ketchum's lobbying firm, and president of Ketchum Public
Affairs. Were the Ketchum link disclosed, perhaps some real NBC reporter
might find the nerve to ask her what other Karen Ryans and Armstrong
Williamses might be on the Ketchum payroll. Or not.

    The Bush propagandists have been successful at many tasks, from
fomenting the canard that Iraqis attacked on 9/11 to deflecting moral
outrage from Abu Ghraib and toward indecency as defined by its Federal
Communications Commission. But Social Security may be a bridge too far even
for propaganda machinery of this heft. Polls find that an ever-increasing
majority of the country rejects the idea of letting Wall Street get its
hands on its retirement savings.

    Americans do have short memories, but it's the administration's bad luck
that not just Kenny Boy but a whole brigade of bubble plutocrats have lately
been yanked back into the spotlight by their legal travails: WorldCom's
Bernard J. Ebbers, Tyco's L. Dennis Kozlowski, HealthSouth's Richard M.
Scrushy, Global Crossing's Gary Winnick. No one is glad to see them. The
public knows that the economy has not fully mended, and that there remain
different economic rules for insiders than for the panelists drafted for the
presidential Social Security roadshow. The new bankruptcy bill embraced this
month by Republicans and Democrats alike throws Americans paying usurious
credit-card interest to the wolves even as wealthy debtors remain protected.

    You can catch the public mood in the reaction to Martha Stewart's
homecoming. Despite the news media's heavy-breathing efforts to hype her
emergence from jail as the heartwarming comeback of a born-again
humanitarian, the bottom line shows that few in the audience are buying it.
The Martha Stewart Omnimedia stock price started tumbling the moment she was
back on camera, in line with the cratered circulation and ad sales of her
magazine. Handing out hot cocoa to reporters at her Bedford, N.Y., estate
did not turn the tide, and her spinoff of "The Apprentice" may be arriving
just as the country is getting sick of C.E.O.'s again. Coincidentally or
not, ratings for the existing "Apprentice" are off in tandem with the filing
for bankruptcy protection by Donald Trump's casino empire, the saturation
coverage of his lavish nuptials and the introduction of a Trump fragrance.

    It's against this backdrop that the returning Mr. Lay - completely
unrepentant, still purporting on "60 Minutes" that he's an innocent victim
of others - could be the Democrats' new best friend. A Texas tycoon who
helped create the political career of George W. Bush only to be discarded
when scandal struck has re-emerged at just the precise moment when he might
do his old buddy the most harm.

 

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