the CAMP ENRON Report


CAMP ENRON:
... 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

NOTE to READERS:
(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.


OUR DEPARTMENTS:

the COGENT PROVOCATEUR:
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


CAMP ENRON:
... gateway to the next Progressive Era?

For a brief orientation, see this
Welcome to Camp Enron

OTHER GOOD STUFF:
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.
Saturday, March 09, 2002

 
--- Seattle Angles ---

In Houston, Judge Harmon appoints two Seattle law firms, and Lynn (good cop) Sarko and Steve (bad cop) Berman individually, as lead counsel for Enron employees. Berman and Sarko teamed up on Exxon takedowns after the Valdez incident. Berman helped scare the tobacco industry into the multi-state mega-settlement.

Berman -- aka King of Class Actions -- exemplifies at once the best and the worst of our civil litigation system. The best: going after evildoers and bringing them squealing to justice. The worst: deploying technology to launch boilerplate shareholder lawsuits on any major drop in a high-flying stock.

In the local press, Berman has engaged in hot talk re the Public Securities Litigation Reform Act (PSLRA) of 1995 and the Securities Litigation Uniform Standards Act of 1998, accusing WA Senators Murray and Cantwell of setting the stage for Enronitis by passing legislation which discourages corporate responsibility by tilting the table against shareholder suits. Ironic, since the legislation is in large part a reaction to Berman's push-button litigation habits ... and off-target, incidentally, since Cantwell was not in Congress when either measure was enacted. For some reason, Berman's op-ed on the subject is not available in Seattle Post-Intelligencer online archives.

Speaking of counsel you would not want to find on the other side of your case, Washington A.G. Christine Gregoire (lead for the states in the tobacco case settlement) is ticked off at Enron ... on multiple counts. Gregoire reinforces a point I raised earlier, re the combined effect of (approximately symmetrical) hedged long term forward commodity derivatives and (wildly asymmetrical) treatment of contracts in bankruptcy.
As a corporation in Chapter 11 bankruptcy, ... Enron can keep those contracts that are profitable to the company (we pay Enron), and reject those contracts that are not profitable (Enron pays us).
If this hole isn't plugged, it creates intense incentives in favor of deliberate bankruptcy.

On a Seattle tangent, the WSJ editorial page has engaged in a full-tilt pissing contest versus Fannie Mae, with FNMA getting the best of it by virtue of Franklin Raines' rebuttals and rebukes, independent testimonials to FNMA integrity, and WSJ's own poorly crafted cheapshots at FNMA accounting and risk management practices. In additional to being the man at OMB when the US turned the corner from deficit to surplus, Raines is one of several notable graduates of Seattle's Franklin High (an urban core public school). I daresay if Raines had been Enron CEO we'd hear none of this "don't ask me, I'm no accountant" posturing.