Enron: The Smartest Guys in the Room

I caught this documentary by chance on HDNET. I was VERY surprised and riveted for the two hours. Finance is my life. I am astounded at the massive amount of apparent complicity on parade with this story. The tremendous greed and bold face lies demonstrated as the story took its turns are the makings of the best thriller novels (sadly, this brings new meaning to "Reality TV"). I've been thinking about this since Friday: these are some of our best and brightest - what ever happened to their ethics, their honesty? It appears that too many were compromised get get their piece of the action. Big Action!~ I have the feeling this is only the tip of the iceberg at Enron - however, the movie is a tremendous collection of some VERY interesting events. Hats off to Bethany, Peter and Alex for a great movie.

I just saw this movie at Talk Cinema in Philadelphia. It was an excellent depiction of hubris and greed. The clips of Ken Lay et all were self serving and only seemed to intensify their greed. I would have liked more exploration in to the ties with the Bush Dynasty but that said it was an interesting intense film. Definitely one that I would be happy to recommend. There is one critique I would make is that although the film touched on the many lives that were ruined by the Enron Scandle,it did not give them a real human face.

In the eighties we called people like the Enron Executives "Masters of the Universe." Now we can call at as we see it, Over grown former nerds with no morality and no conscience.

.

This film is a profoundly entertaining chronicle of American corporate power run amok. Profound because as it dramatizes the rise and fall of Enron, the film casts a longer shadow over the still largely unchanged corporate environment that spawned this smoke and mirrors company. Entertaining due to clever use of storytelling devices, imagery and soundtrack, despite what looks to be a low budget.

The film's strength is in its portrait of the massive "group think" inside and outside of the corporation that supported Enron's rise. It is astounding and chilling to look back on the cheer leading role played by banks, financial media, accounting firms and government. And though Enron, the film, may be weak on explaining how the company built itself up from a simple gas pipeline business to a post-modern corporate megalith, it was probably a wise choice to leave detailed descriptions of the financial manipulations to the book of the same name. The film, does though, miss an opportunity early on to provide a basic explanation of the central paradox of Enron -- earning heaps of money by exploiting commodities trading and accounting methods, while losing heaps of money in real world ventures. Enron set up its first commodities trading desk to capitalize on inside knowledge of the gas business, and then tried to replicate this model with water, broadband, electricity, etc. In actually a trading firm, Enron evaded investment firm regulations by portraying itself as an industrial firm.

Yet, despite some shortcomings, the storytelling is powerful, especially the eye-opening dramatization of Enron's role and the political manipulations behind the California energy-crisis. After viewing the suffering of average Californians, juxtaposed against the callousness of Enron's West Coast energy traders, it felt good to see Kenneth Lay walking in handcuffs.

More than once, the phrase, "this can happen again," echos in the film. It has happened before -- leveraged buyouts, the Savings and Loan crisis, the burst Internet IPO bubble, the 1920s Stock Market crash. A new financial vehicle generates untold riches for some, goes bust, and millions, sometimes billions ... disappear. Enron, the film, is the textbook on how one corporation recently stole from investors, employees and its "customers."

Ask why do we keep on letting this happen.

The chief characters in the Enron debacle all seemed to be functioning on the same mantra, that Gordon Gekko line from "Wall Street" (1987) that epitomized the 1980s: "Greed, for the lack of a better word, is good." Except what Ken Lay, Jeff Skilling and Andy Fastow did wasn't in the 1980s, but in this century and they blithely and without any compunction did it for personal gain while tens of thousands were left with nothing.

The Enron scandal was a tough one to understand, at least to me it was, because you could never quite figure out what Enron did. And director Alex Gibney breaks it all down matter-of-factly, never taking sides, never being judgmental, to show us what happened. Of course, he really doesn't need to be judgmental because the actions of Lay, Skilling and Fastow (and a few others) speak volumes.

Gibney's film very well could have been a convoluted mess. But he never loses sight of the fact that this is essentially a story about people. Not only the masters of the universe whose hubris eventually brought them down but, more importantly, the people whose livelihoods depended on what Lay, Fastow and Skilling did and who, unlike those three, didn't have millions to fall back on.

It's impossible not to feel incensed by what they did. Lay, Fastow and Skilling destroyed countless lives, yet they left with millions. There's a moment when Lay bemoans that his net worth dipped from $20 million to, I believe, $6 million. Yeah, tell that to the Oregonian utility worker, whose $340,000 nest egg was eventually only worth $1,200 after Enron stock tumbled in the wake of the scandal.

What's ultimately devastating about this film is listening to the tapes of Enron traders joking about how they were holding California hostage and letting people there suffer without electricity. These chaps are cold, callous and exemplify the Enron environment.

This is a fascinating film because it exposes these guys for who they are. And after listening to those interviewed in this film, it's impossible to believe Lay and Skilling were somehow oblivious to it all. How else could you explain why they insisted Enron employees invest in the company stock while they themselves were cashing out?

What's equally infuriating is realizing how Wall Street sucked up to Enron and how investment firms turned on anyone who dared to question Enron's power.

Of course, it's not surprising at all to see Lay's connections to the Bush family. But I am certain Dubya really didn't know very well someone he called "Kenny Boy." Just as, I'm sure, W's photos with Jack Abramoff mean absolutely nothing, either.

There's a moment in "Wall Street" when Bud Fox asks Gordon, "How much is enough?" And Gordon replies, "It's not a question of enough, pal. It's a zero sum game, somebody wins, somebody loses. Money itself isn't lost or made, it's simply transferred from one perception to another."

That's exactly what Enron did under Lay and Skilling. Except they did it on the backs of tens of thousands of hard-working Americans who lost pretty much everything. I can only hope the American justice system does right by all those workers.

The documentary "The Smartest Guys in the Room" is based on the excellent book by Bethany McClean and Peter Elkind. If you work for an American corporation, have ever owned stock in a corporation, or have mutual funds, you must see this movie. It gives a clear eyed view of what can happen in our society when greed really is considered good. The movie accomplishes what few in this genre have done: It is informative and also entertaining. Some of this is due to the behavior of Enron executives. For example, one frequented strip clubs every night and made his staff come along. Naturally that requires video of strippers. Some of the most damning video is from Enron execs themselves. They never dreamt they would be caught. Hubris gone wild. Go see this movie. Take friends with you. You will be glad you did. First rate film all around.