« Another Week in Review from RegimeChangeIran | Main | A couple of new books in the sidebar »
April 12, 2005
Chester Reviews "Enron: The Smartest Guys in the Room"
[I was recently offered the chance to review the new film, "Enron: The Smartest Guys in the Room," based on the book of the same name by Bethany McLean and Peter Elkind. I'd like to thank Special Ops Media for this opportunity.]
-----------------------------
In December of 2004, I was in Houston on business and grabbed dinner and drinks with a friend in commercial real estate there one evening. As we drove downtown, he pointed out many of the landmarks of the Houston skyline, and we took a brief detour to look more closely at several. We pulled up in front of one particular two-towered high rise. It was about 11pm and the streets here seemed especially deserted. The towers were beautiful, though my friend quickly told me they were nearly completely empty. Some local developers had recently purchased the empty building for a song. It was then that I turned and saw the now infamous capital "E" sitting on a 45 degree angle. This was the former world headquarters of Enron.
A large part of the US population probably had some relationship with Enron at one point or another -- either you did business with them, knew someone who worked there, or were a shareholder -- or if not, one or your mutual funds probably was. Now, after its downfall, Enron is little more than a punchline. "Enron accounting" is an accepted substitute for other older idioms like "cooking the books."
But what was it that happened at Enron? Certainly there was more to it than just blatant financial and accounting shenanigans? If "Enron" is to remain as the butt of jokes, it is necessary to know and remember how this turn of events came about.
"Enron: The Smartest Guys in the Room" goes a long way toward answering these questions. Directed by Alex Gibney, "Smartest Guys" is a well-edited and thoughtfully executed documentary of Enron's rise and fall. We go deep into the lives and backgrounds of all of the major players: Ken Lay, the PhD and de-regulation advocate who became the chairman, perhaps blinded by the visionary prognostications of Jeff Skilling, the Harvard MBA consumed with the concept that anything was more or less acceptable so long as smart people were behind it; Andrew Fastow, the amoral numbers whiz and Skilling's protege, who dreamed up ways to hide Enron's debt, and a whole cast of colorful characters that in many ways seem to be extras from old "Dallas" episodes, and whom one would expect to find in any morality play set in Texas. Theirs is a fascinating story.
The filmmakers deserve kudos for both the incredible access they achieved in interview subjects, and for the outstanding footage they incorporate into the film. While other documentaries have to rely on stock footage carefully woven together to portray scenes for which there is no record, here we have probably a dozen or so clips from Enron company meetings, recordings of phone conversations between energy traders, and even a brief snippet from a conference call with Wall Street analysts in which Skilling calls one an "asshole" for questioning Enron's financial records.
The Enron executives' relationship with the Bush family is tastefully performed as well. The viewer leaves not with the impression that George W. Bush is guilty by association with Enron personnel, but instead with a deeper realization of just how accepted Skilling and his ilk were in the mainstream corridors of power. This is either smart filmmaking, since it is always best to stick with the script and not wander too much into conspiracy-land, or smart marketing, since those marketing the piece probably realize that many right-of-center viewers are happy to see a film that excoriates accounting tomfoolery in big business.
Since I lived in California during the rolling blackouts of 2001, I thought the portion of the film dealing with this whole issue was very interesting. Unfortunately, here is where the narrative takes a stumble a bit. There is much made about the deregulation of California's energy market in the late 1990s by Governor Pete Wilson, and much made of the control Enron is able to exercise to lower capacity until prices rise and then to turn the spigot - as it were - back on to make obscene profits. There is a scene of Governor Gray Davis asking the federal government to intervene, and just a kiss of a conspiracy as to why Bush chose not to do so -- with a little bit of Ahnold-electioneering thrown in to spice it up a bit. I thought this to be dissatisfying since I lived in California just long enough to see how many of its problems are its own policy creations. Governor Wilson de-regulated the energy sector, yet Gray Davis's only option was to ask for federal help? This seems a little disingenous, especially since the filmmakers explain that Enron had a specialist among the energy traders who was the only guy anyone knew who had actually read all of California's rules and figured out how to game the system. No doubt Enron was up to some nefarious manipulation of the system, probably complying with the letter and not the spirit of whatever laws there were -- but this bit of the story needed a clearer explanation in the film.
That minor speedbump aside, this is an excellent work overall. Even the musical choices add much to the tenor of each chapter, blending well with the desired mood, and are incorporated flawlessly into the narrative.
The questions I left with were these: Was Skilling so convinced of the glory of an unregulated energy services and trading firm that he truly did not know how bad things were? Did he truly understand the complex structured financial transactions that Fastow foisted upon him? Or was he in the know all along, riding the gravy train as long as he could, then bailing at the perfect moment? Whatever the answer, his was not a character that belonged in charge of anything-- that much is certain, and this is a lesson often overlooked in the corridors of power: intelligence is not only amoral, but it also has little to do with leadership ability.
I highly recommend this film. Don't miss it.
Posted by Chester at April 12, 2005 9:46 PM
Trackback Pings
TrackBack URL for this entry:
http://www.theadventuresofchester.com/MT/mt-tb.cgi/642