Enron: The Smartest Guys in the Room [DVD]

Bethany McLean, who along with Peter Elkind, wrote the book from which this documentary was adapted, is clearly satisfied with herself as she sits on a couch relating what she knows about the fall of Enron. And she should be. She was the one who first really pursued the question, "How does Enron make money?" What she didn't know when she first asked the question is that they make money the old-fashioned way, they steal it.

What I was most forcibly struck with while watching this fascinating story is how much all the posturing and lying and misrepresenting of the talking heads, Jeff Skilling, Kenneth Lay, et al., reminded me of George W. Bush, Dick Cheney, et al., in the White House. The key similarity is the use of their power over the media and in front of a podium to mislead the minions and the public to their advantage. Without the ability to lie to large numbers of people at the same time, and to stifle and belittle contrary voices, they would not have succeeded.

But also there is the complacency and the complicity of not just the greedy stockholders and the adoring employees, but the greater public who failed to ask not "why?" but "how?" In the case of Enron, how can a company exceed not only all expectations, but something like the law of financial gravity? If it looks too good to be true and nobody can give you a clear answer to how it's done--guess what? It is too good to be true. It may seem a stretch, but the same kind of mentality continues to persuade Nigerian scammers and "Congratulations: You've Won!!!" emailers that there are still fat bank accounts in America just waiting to be emptied. Nobody wanted to look too closely because nobody wanted to prick a bubble. Instead everybody wanted to believe that things that go up never have to come down (at least not now), and that the smartest guys in the room really were, and thanks to them we are all going to get rich, or at least we can applaud and admire from the sidelines.

Another failure is that of not looking critically at the cultural climate and the mentality of the traders and their bosses, whose morality (in the form of emails and public pronouncements) was that of people who would cheat their best friend, who would steal from widows and orphans (no exaggeration: they did) and laugh about it.

And the bankers and the brokerage firms, the federal watch dogs and the Congress--where were they? Lapping it up like lap dogs, getting paid off or having their campaigns funded by the robber barons at Enron. Greed is good! It's the American way! Deregulate everything! The police force, the army; and free enterprise and the magical, invisible hand of the marketplace will bring us unprecedented and unparalleled riches. Burp!

No, the honchos at Enron were not the smartest guys in the room. They were the sickest. Smart guys would have made a good living, maybe even enough to buy that house on the hill, a vacation home in some warm clime, while having banked and invested enough to send the kids and grandkids to good schools, and been satisfied. They might even have taken some pride in the work they were doing. But how can you take pride in your work when you are essentially stealing from others, especially when you are stealing from the very people who work for you and trust you? The smartest guys in the room would not have thrown so much time and energy into ripping people off, into gratifying a warped desire to financially lord it over others. They would not be those who cared more about ratcheting up their millions than they did about anything else in life. People who care about winning so massively and so cruelly are not smart. They aren't even well. They are the sickest guys in the room.

Alex Gibney (who also wrote and produced the excellent The Trials of Henry Kissinger 2002) is to be commended for making the kind of documentary that informs, enlightens and appalls. The footage from corporate meetings, press conferences, company skits (oh, what fun they had!) and interviews with the principals and those they ruined make for a most engaging moral lesson. The story unfolds like some kind of pathological tragedy from inside a fascist state or like the neoconned White House where public pronouncements are made with only one goal in mind: deception. What fools these morals be. And the biggest fools are the greediest whose lives are lived in empty pursuit of nothing more than naked power with which they can buy nothing of value that they didn't already have.

Alex Gibney's riveting documentary is based on the acclaimed book "The Smartest Guys in the Room" by Bethany McLean and Peter Elkind. Chronicled is the corporate crime of the century by the movie following the inevitable toppling of the seventh-largest business operation in the U.S. Peter Coyote narrates this mind boggling odyssey of greed, arrogance, ethical malfeasance, and power plays through which Enron is changed from a properous natural gas pipeline company to a multinational mehemoth.

The major characters responsible for Enron's downfall could not be interviewed for the movie because they refused to be. But Gibney gives us lots of insights into their leadership style with news footage, corporate audio and video tapes, a comedy skit performed in front of employees, C-Span clips, and a catalog of other visual and recorded material.

Incredibly, even NOW Texan Kenneth Lay, the son of a Baptist preacher and close friend of President George W. Bush (affectionately referring to him as "Kenny Boy"), and Lay's hand-picked CEO, Jeffrey Skilling, deny any wrongdoing. One segment reveals that Skilling's favorite book is "The Selfish Gene." The Darwinian manifesto presents a dog-eat-dog version of human nature. Money is the only thing that counts for Skilling. His ruthlessness coming from such a philosophy is demonstrated throughout his predatory career. Skilling's "mark-to-market" accounting tricks worked long enough to give him the hubris to believe that anything was possible for Enron because they were "the smartest guys in the room."

The documentary reinacts the suicide of Enron executive Cliff Baxter; exposes the magic tricks of CFO Andy Fastow, who had made millions for the company through shell companies that covered up Enron's staggering debt. One of the deceptively quiet raiders, Lou Pai, a right-hand man for Skilling, was a mysterious figure with a penchant for strippers -- who cashed in his stock options and ran off with hundreds of millions of Enron's dollars.

Whistleblower Sherron Watkins' interviews illumioates the inner workings of Enron's corporate culture. Indeed, the callousness and heartlessness of these go-getters are revealed throughout the documentary. Yet the most depressing part is that the Enron scandal could only have happened by so many accountants, lawyers, Wall Street traders, investment bank analysts, and government regulators looking the other way for years. They enabled Enron's corporate corruption to grow. They were too compromised to speak the truth in the face of power. As a result, millions of ordinary investors were royally screwed, and thousands of Enron employees lost their life savings.

It was never going to get a fair hearing. If there was any defence in one of the most nauseating cases of corporate pillaging, self-aggrandisement and greed it was not going to be seen in this film, shown in Brixton's Ritzy Cinema. The chalk board on the door to the screen set the scene.

What emerges is a staggering story of a corporation romping over the established rules and procedures, riding the bull market to new highs and only crashing down when the people saw that the

The truly tragic thing is not the tales of the various executives, marketing men and lawyers. Some of them lost their jobs, but soon found others. The criminals went to jail, and had their ill-gotten gains confiscated. But the real victims were only fleetingly shown. This was a sole complaint in the otherwise masterly editing of this film. A thorough investigation in to the losses borne by the pensioners and pension holders would have presented a truly staggering contrast to the corporate greed on clear display.

What does emerge is a smattering of personal stories which gives some idea of the extent of the damage done. Private pensions shrunk from £350,000 to $1,500. And with it the dreams of a comfortable retirement destroyed. These were the ordinary people, long-term employees with rock solid utility companies who had invested everything with their new parent company, Enron. With promises of riches for all, they funded the bloated, wallowing greed, and they paid the ultimate price for its inevitable failure.