An Attempt at Explaining, Blaming, and Being Very Slightly Sympathetic Toward Enron

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The audiobook of Smartest Guys in the Room: The Amazing Rise and Scandalous Fall of Enron caught my eye over a year ago, but I didn’t read it because it’s 22.5 hours long. I’m not a finance expert, and I figured if it only took 10 hours longer to understand the entire life of Napoleon, then maybe it wasn’t worth wading into limited liability special purpose entities, broadband capacity trading, and Tobashi schemes.

But I finally listened to Bethany McLane and Peter Elkind’s exploration of the largest bankruptcy in American history (at the time). Then I read a whole lot of wikipedia articles, read a whole bunch of news articles from the early 2000s, talked to Byrne Hobart for an hour, and now I am going to attempt to present a succinct, yet comprehensive summary of what Enron was and how it fell.

As cliché as it sounds, what makes the Enron scandal so fascinating is its bewildering complexity. As late as 2001, nobody outside of Enron could actually explain what Enron did. Sure, outsiders could summarize it as a “logistics company” or say it did “energy trading,” but even the most diligent analyst didn’t know half of what Enron was up to because… well, Enron didn’t report half of what it was doing.

But at the same time, nobody inside Enron could really explain what the company was doing either. Sure, the executives knew more than the analysts, but such a vast company with so many opaque moving parts simply cannot be comprehended by a single mortal man. This isn’t embellishment – that was basically the legal defense of much of the Enron executive team after the company’s downfall. Many executives didn’t try to argue their innocence so much as confuse the judge, jury, and everyone in the courtroom with byzantine accounting non-explanations. Enron’s CEO, Ken “Kenny Boy” Lay, claimed that he honestly couldn’t follow the machinations of his hand-picked COO and CFO as they bounced billions of dollars of Enron assets and debt between corporate accounts and quasi-shell investment funds owned by Enron executives and their families so as to artificially boost Enron’s credit rating. Who could?

Beyond the technical aspects, the Enron scandal was arguably just as morally complex. This was probably my biggest surprise when reading the book. I had only heard about Enron in passing on the news as the ultimate example of financial dishonesty, or as the apex of predatory capitalism, and all of that might be true… or maybe not. It’s hard to say. I’m wary of passing judgement not just with the benefit of hindsight, but the benefit of being outside the reality distortion field which undoubtedly engulfed Enron for the better part of a decade. Enron’s executives were no angels, but they weren’t entirely demons or scoundrels or fools or decent men put under unimaginable pressure… they were all of those at once.

I’ll frontload the disappointment: there are no easy answers or smoking guns with Enron. There was no one executive who obviously made a conscious choice to commit fraud (at least not on a large scale). There was no single financial maneuver or strategy which was blatantly illegal. There was no identifiable point-of-no-return. There were just lots of morally weak but clever individuals who did what they thought they had to, or were allowed to, or what would work out in the end… until it didn’t.

I’ll start my piece with a summary of Enron’s entire history, starting with the origins of its founder, all the way to its dramatic conclusion. Then I’ll explain how and why Enron fell in three parts:

  • Mid-Level Explanation – A condensed, digestible summary of the Enron scheme
  • Low-Level Explanation – A deep dive into the mechanics of the various sub-components of the Enron scheme
  • High-Level Explanation – An analysis of the legal and moral underpinnings of Enron’s scheme

Continue reading “An Attempt at Explaining, Blaming, and Being Very Slightly Sympathetic Toward Enron”

The Taiwan Junket: A Story of Political Farce & Fools

Taiwan Flag

The following is a true story. It is based on notes taken from a conversation with a former state representative from a Midwestern state who I’ll refer to as John Smith. He has asked to remain anonymous.

It was the early-2000s. With 6 months left in his third term as a state representative, John Smith was a lame duck. Other legislators gave Smith sad little nods in the hallways, and the “watchers” – the lobbyists who sat in on every vote – stopped inviting him to comped dinners at fancy restaurants. Without an opening available in the state Senate, Smith knew his political career was over, at least for a while.

Smith had seen many of his colleagues come close to mental breakdowns when they finally left office. They couldn’t comprehend why strangers stopped taking their phone calls and laughing at their jokes. Their sense of identity and self-worth was tied up in their title and modicum of power over their fellow citizens. But Smith didn’t care about all that. He was a hardcore libertarian, though he wasn’t open about it. He hated the political machinations which stole money from the people to be dolled out by the aristocracy of pull. Smith never tired of mocking the self-righteous, self-important elected officials who revel in power so petty that their own constituents don’t even know what they do.

Continue reading “The Taiwan Junket: A Story of Political Farce & Fools”

The Phantom’s Pain – A Metal Gear Solid V Narrative Analysis

Note – This piece was originally posted at Theory of Objective Video Game Aesthetics. It has been edited and slightly revised before being posted here.

6/20/19 EDIT – This analysis is now a source for an academic thesis. If you’re a Metal Gear fan, be sure to take the thesis’s survey here: https://wcupa.co1.qualtrics.com/jfe/form/SV_0My6TdeXpREbNUF

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Introduction

“Now do you remember? Who you are? What you were meant to do? I cheated death, thanks to you. And thanks to you I’ve left my mark. You have too – you’ve written your own history. You’re your own man. I’m Big Boss, and you are too… No… He’s the two of us. Together. Where we are today? We built it. This story – this “legend” – it’s ours. We can change the world – and with it, the future. I am you, and you are me. Carry that with you, wherever you go. Thank you… my friend. From here on out, you’re Big Boss.”

– Big Boss

When I first finished Metal Gear Solid V: The Phantom Pain, like so many other players, I was disappointed. MGSV was supposed to be the “Missing Link” in the Metal Gear canon. It was that game that would reveal the bridge between the heroic Big Boss of MGS 3, Portable Ops, and Peace Walker, and the grand historical villain of Metal Gear 1 and 2. As expressed by numerous launch trailers and Hideo Kojima tweets, MGSV was going to be a tale of Big Boss’s fall into darkness, driven by an insatiable lust for revenge, a consummate anger lit by his enemies which would scorch his soul until nothing was left but a power-hungry mad man who would threaten the world with nuclear war for the sake of his deluded ambitions.

Instead we got an incredibly weird twist which did little more than retcon patch a largely ignored plot hole in one of the least-played Metal Gear games. We found out that the final boss of Metal Gear 1 was not Big Boss, but a body double, who through surgery and hypnotherapy was made into almost an exact copy of the legendary soldier.

Again, like most other players, when I first finished the game I thought this was a neat trick, a typically crazy, convoluted, but seductively entertaining twist from one of my favorite storytellers of all time. But of course… it was also a major let down.

Finding out that I had just played as some random-ass medic from Militaires Sans Fronteres for the last 80 hours instead of the most important character in the entire Metal Gear canon was certainly a mind-fuck, but also left me feeling deflated. What was the point of it all? Why did I just follow some entirely new character for an entire game who has only a minor, tangential connection to the series’ larger plot instead of seeing Big Boss’s moral/psychological/narrative transformation which is at the heart of the entire series and was supposed to be the entire point of Metal Gear Solid V?

Continue reading “The Phantom’s Pain – A Metal Gear Solid V Narrative Analysis”