the CAMP ENRON Report

... gateway to the next Progressive Era?

Some say it's nothing but a train wreck ... roll in the big cranes, clear the track, see what the crew's been smoking. If I thought so, I'd not be writing this ... and if they thought so, they'd not be drumming so hard.

For a brief orientation, see this
Welcome to Camp Enron

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Camp Enron Archives
01/01/2002 - 02/01/2002 02/01/2002 - 03/01/2002 03/01/2002 - 04/01/2002 04/01/2002 - 05/01/2002 05/01/2002 - 06/01/2002 06/01/2002 - 07/01/2002 07/01/2002 - 08/01/2002 08/01/2002 - 09/01/2002 06/01/2003 - 07/01/2003

(2) All "major" articles of older material have now been imported, some with updates worth perusing. We'll keep it all on the main page for a while, will add a few loose pieces of history, will trim the main page and index the archives for convenience later.


free agent, loose cannon, pointy stick ... taking an imposing analytic toolkit out of the box, over the wall and into the street ... with callous disregard for accepted wisdom and standard English

reading the tea leaves from original angles, we've led with uncannily prescient takes on the federal surplus, the dotcom crash, the "Energy Crisis", the Afghan campaign, the federal deficit.

More where those came from ... stay tuned.

For brief orientation, see this
Welcome to CP

... gateway to the next Progressive Era?

For a brief orientation, see this
Welcome to Camp Enron

Many thanks to Tony Adragna and Will Vehrs, still shouting 'cross the Potomac at QuasiPundit. Early Camp Enron material can be found in QP's Dispatches department.
Sunday, February 24, 2002

--- How Al Gore Nearly Saved Enron ---

Al Gore Nearly Saved Enron. And Global Crossing. And a cumulative $2T in deadweight destruction of real (not speculative) capital.

At the dawn of the 1990's, Al Gore, Jr. was making noises about an Information Superhighway. (He may not have coined the phrase, but he most firmly impressed it in the national dialogue.) Gore's vision was a blend of ARPANET, the Apollo Project, and the Interstate Highway system that Al Gore, Sr. took the initiative in creating back in the 1950's. The feds would create the backbone, set standards and enforce terms of service. Commercial players and co-ops would build out the onramps, local loops and customer amenities.

Funny thing happened on the way to the Future. Gore lost to Clinton in the race for the 1992 nomination. Clinton picked Gore as VP, and picked up on Gore's information highway concept, but ...
In October 1992 ... a fundraising dinner party for Bill Clinton, Al Gore and 135 Silicon Valley and biotech executives ... raised $400,000. A top priority in Silicon Valley was ... the so-called "information superhighway." ... Gore envisioned ... government leading the charge. ... leading executives wanted a network built by private companies like their own. ... by the end of 1993 the Vice-President ... declared : "Unlike the intestates, the information superhighway will be built, paid for, and funded principally by the private sector." Remarkably, within two days of Gore's remarks, telecommunications companies ... contributed $120,000 to the Democratic Party. [PBS Frontline]
Gore probably had it right the first time, for at least two important reasons. First, the autonomous self-tuning properties of commodity market economics DO NOT APPLY to networks. The invisible hand has no idea how to build or maintain minimal spanning trees or any of their higher order n-connected analogs. Indeed most of the literature on network economics is restricted to the case of a single network operator.

Second, a backbone transport authority would have had leverage to induce cooperation and choice at local levels, along with an exchange-based funding stream to support nonthreatening cross-vendor amenities.

Instead we had a classic case of competitive overprovisioning, a race for first-mover advantage, de facto standardization wars, compatibility linkage contests (amid nonstop lobbying oneupsmanship). At the end of the day, $2T in real capital was effectively flushed down a rathole -- invested in capacity that will be obsolete long before it is used. This in turn brought financial devastation for firms big and small, new and old, good and bad, innovators and consolidators ... and for vendors who sold them supplies and services ... and for widows and orphans invested in "safe" utilities.

One of the companies trampled in the rush to the exits was Enron (by way of its bandwidth trading operations). Another was Global Crossing. A lot of other firms inthat sector went down the tubes without cooking the books, and don't kid yourself -- there are other companies cooking the books out there (not all of which would achieve negative net worth if exposed).

[authored 2002-02-24, originally posted on The Fray]