Liberal Conspiracy Theories: Bush and Enron

by | Jan 21, 2002

The U.N., the Trilateral Commission, the international conspiracy of Jewish bankers — these are the conspiracy theories for which right-wing nuts are infamous. But what about the conspiracy theories of the left? I’m sure you have heard of them: the Military-Industrial Complex, the “vast right-wing conspiracy,” and, of course, the international conspiracy of multinational conglomerates. […]

The U.N., the Trilateral Commission, the international conspiracy of Jewish bankers — these are the conspiracy theories for which right-wing nuts are infamous. But what about the conspiracy theories of the left? I’m sure you have heard of them: the Military-Industrial Complex, the “vast right-wing conspiracy,” and, of course, the international conspiracy of multinational conglomerates. Now many Democrats are proposing a new candidate: the Bush-Enron conspiracy.

What is the evidence for this conspiracy? As Enron teetered on the brink of bankruptcy, some of its top executives — who had also been major contributors to the president’s campaign — phoned members of the Bush Cabinet and asked them to help bail the company out. The Bush officials’ response? They did nothing.

So where is the scandal? From what do the Democrats hope to manufacture “Enron-Gate”?

Democratic spin-doctors are working feverishly to have their cake and eat it, too. First, they claim that the phone calls show that “Bush is cozy with wealthy moguls.” Then, if anyone points out that Bush did not actually give the moguls any special favors, the Democrats condemn him for that, too. The administration, they say, “could have done more to protect employees and shareholders.”

The political opportunism of this damned-if-you-do, damned-if-you-don’t approach is too obvious for some Democrats. So they have opted for versions of the conspiracy theory that are more subtle — but no more convincing.

Enron is described as a cabal of free-marketers seeking to profit from electricity deregulation. This is wrong on three counts. First, electric utilities have not, by and large, been deregulated; California’s power “deregulation,” for example, was enacted through hundreds of pages of new regulations. Second, Enron does not represent the free market; it was a major proponent, for example, of the global warming scare. Enron sought to profit, not from free markets, but from the higher demand for natural gas caused by government restrictions on other fossil fuels. Last but not least, Enron clearly did not profit from anything; it went bankrupt.

Others charge that this is an example of a company using political contributions to flout the law. In The New York Times, Paul Krugman screams that “politicians with personal ties to Enron … took care to exempt Enron from regulation.” But neither he nor anyone else has named a single specific regulation from which Enron was exempted. And if political contributions are to blame, then why did the Bush administration refuse to bail out Enron, despite the firm’s large political contributions to their boss?

The last resort of this conspiracy theory is the most revealing. There is no specific political conspiracy, some commentators concede, but merely a demonstration of the evils of big business and free markets. Newsweek’s Allan Sloan, for example, blames the scandal on the alleged greed of Enron’s managers, who pocketed stock options for years, then ran the company into the ground. He also claims that Arthur Andersen — the accounting company that failed to decry Enron’s dishonest bookkeeping — was kept silent by millions in consulting fees, and that Wall Street brokers were seduced by their shares in Enron’s energy trades.

But none of this makes sense, either. Enron executives could have pocketed many more stock options if they hadn’t crashed their company’s stock; Andersen could have gathered more consulting fees, rather than destroying its reputation; and Wall Street could have had many more energy deals to broker.

No, the facts don’t explain the Enron conspiracy theories. All that the facts reveal is an unsuccessful conspiracy by corporate managers to hide their incompetence. So why do the liberals think this has vast implications, that it might go “all the way to the top”? What explains these theories is not any facts, but rather a basic philosophic outlook, a theory that views the entire capitalist economy as a giant conspiracy to exploit the little guy. They got this view from Marx, who explained everything in terms of the “bourgeoisie” conspiring to exploit the “proletariat.”

Marx also taught them that all ideas, political arguments, and party platforms were just thinly disguised elements of this same conspiracy of exploitation. That explains why the liberals see this as a political scandal. You didn’t think that Republicans advocate free markets because they actually believe in their ideas, did you? No, they do it because they’re in on the conspiracy.

Marx’s theories may be all but dead, but they live on in the hearts of the left, and the liberals’ exploitation of the Enron case is their latest feeble attempt to breathe life back into this discredited philosophy.

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Robert Tracinski was a senior writer for the Ayn Rand Institute from 2000 to 2004. The Institute promotes the philosophy of Ayn Rand, author of Atlas Shrugged and The Fountainhead. Mr. Tracinski is editor and publisher of The Intellectual Activist and TIADaily, which offer daily news and analysis from a pro-reason, pro-individualist perspective. To receive a free 30-day trial of the TIA Daily and a FREE pdf issue of the Intellectual Activist please go to TIADaily.com and enter your email address.

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