The Coming of Enron

by Alexander Cockburn And Jeffrey St. Clair

It’s been more than a year now since the Texas conglomerate Enron swaggeredinto Oregon to gobble up Portland General Electric for a cool $3.2 billion.The press delicately referred to the deal as a merger. But this has provena grotesque misnomer. There is no question who the dominant partner is inthis relationship, Enron. It’s a company that never accepts a subservientrole and doesn’t tolerate anyone telling it how to behave.

Initially Wall Street mavens scratched their heads at the merger. Whatinterest would Enron, a global energy giant, have in PGE, a moribund electricutility saddled with a defunct nuclear reactor? The answer came soon enough.Enron’s sights weren’t on Oregon, but our neighbor to the south, the 31million residential electric consumers in California, and the high-tech,aerospace and defense factories that make the state one of the world’s mostpower-hungry regions. This is the mother lode for the new energy robberbarons. But to enter this lucrative market Enron needed credibility as apower provider. But like a apex corporate predator Enron also had its eyeson PGE’s assets, cheap hydro-power that it could sell across the West athuge mark ups, power plants and dams that it could auction off, and a networkof transmission lines that led right into the high-priced California market.

As for PGE’s problem child, the Trojan reactor, Enron’s acquisitionsanalysts believed it would prove only a minor irritant. There was a provensolution: stick the ratepayers with a large share of the costs of this misbegottenventure and dump the nuclear waste, and the attendant risk, on the federalgovernment. This is the old strategy of privatizing the profits and socializingthe costs.

Enron begrudingly admits to all this in one of their latest filings withthe Securities Exchange Commission, where Enron’s CEO Kenneth Lay confirmedthat the acquisition of PGE “has allowed Enron to expand its West Coastpower marketing operations and has assisted in establishing entry into retailmarkets in other parts of the country.” In other words, PGE customersare funding Enron’s expansion plans.

But the target is not just California. Enron truly has a global reach.In fact, more than 35 percent of the company’s income derives from its internationaloperations, pipelines across the Amazon, oil wells off the coast of Venezuelaand Trinidad, power plants in Indonesia, China and India, and a water companyin Great Britain. The guaranteed profits from PGE can be channeled intoany of this overseas operations, where Enron expects to make as much as50 percent of its profits by the year 2002.

Enron has a reputation for getting what it wants and doing whatever ittakes to get the job done. The purchase of PGE presents a microcosm forhow Enron operates on a global scale. The first strategy is to lubricatethe political system with generous infusions of campaign cash. Enron isone of the nation’s top sponsors of both the Democratic and Republican parties,pouring over $3 million into their coffers since 1989. This investment hasyielded the company tremendous rewards, including government brokered andfinanced deals worth billions in China, Indonesia and India. In Oregon,Enron lavished contributions on the state’s congressional delegation, supportingboth Gordon Smith and Ron Wyden. Neither senator uttered a critical peepabout the Texas takeover of Portland’s electric utility.

The second tactic is to buy off the potential opposition, preferablyas cheaply as possible. In Enron’s power deals in India this took the formpolitical bribery. The PGE deal was a fairly straightforward operation.Enron pledged $20 million to local charities and promised to contributean addition $10 million to Oregon environmental groups and conservationprojects, effectively muting any uncomfortable questions about how the Texascompany planned to deal with such home-grown issues as salmon conservationand low-cost electricity.

When philanthropic disbursements don’t quell all the critics, Enron doesn’thesitate to reveal its dark side. The company has a well-earned reputationas one of the most aggressive companies in the energy business. “Theyplay with steel elbows,” one bruised competitor said. In Oregon, Enron,and its partner in crime PGE, wasted no time in going after the Public UtilitiesCommission when the PUC had the temerity to question the public benefitsof the merger. The energy conglomerate rushed to the Oregon legislature,promoting a bill that would eviscerate the PUC’s regulatory power. Ultimately,the PUC buckled under the pressure and approved the deal.

And now the true price tag of Enron’s takeover of PGE is being seen,as deals are cut to ensure that the lowest electric rates will go to largestand most wasteful consumers of power, the pulp mills and aluminum plants.Meanwhile, some of PGE’s most prized assets are being auctioned off to thehighest bidder, with the ratepayers being expected to make up any losses.For the residential consumer and the salmon the honeymoon for the ignominiousmarriage between PGE and Enron is clearly over.

Alexander Cockburn’s Guillotined! and A Colossal Wreck are available from CounterPunch. Jeffrey St. Clair is editor of CounterPunch. His new book is Killing Trayvons: an Anthology of American Violence (with JoAnn Wypijewski and Kevin Alexander Gray). He can be reached at: sitka@comcast.net.

November 26, 2015
Joseph Grosso
The Enduring Tragedy: Guatemala’s Bloody Farce
Ashley Nicole McCray – Lawrence Ware
Decolonizing the History of Thanksgiving
Roxanne Dunbar-Ortiz
Imperial Myths: the Enduring Lie of the US’s Origin
Ralph Nader
The Joys of Solitude: a Thanksgiving!

Joseph G. Ramsey
Something to be Thankful For: Struggles, Seeds…and Surprises
Dan Glazebrook
Turkey Shoot: the Rage of the Impotent in Syria
Andrew Stewart
The Odious President Wilson
Colin Todhunter
Corporate Parasites And Economic Plunder: We Need A Genuine Green Revolution
Rajesh Makwana
Ten Billion Reasons to Demand System Change
Joyce Nelson
Turkey Moved the Border!
Richard Baum
Hillary Clinton’s Meager Proposal to Help Holders of Student Debt
November 25, 2015
Jeff Taylor
Bob Dylan and Christian Zionism
Dana E. Abizaid
Provoking Russia
Oliver Tickell
Syria’s Cauldron of Fire: a Downed Russian Jet and the Battle of Two Pipelines
Patrick Cockburn
Trigger Happy: Will Turkey’s Downing of Russian Jet Backfire on NATO?
Robert Fisk
The Soothsayers of Eternal War
Russell Mokhiber
The Coming Boycott of Nike
Ted Rall
Like Father Like Son: George W. Bush Was Bad, His Father May Have Been Worse
Matt Peppe
Bad Policy, Bad Ethics: U.S. Military Bases Abroad
Martha Rosenberg
Pfizer Too Big (and Slippery) to Fail
Yorgos Mitralias
Bernie Sanders, Mr. Voutsis and the Truth Commission on Greek Public Debt
Jorge Vilches
Too Big for Fed: Have Central Banks Lost Control?
Sam Husseini
Why Trump is Wrong About Waterboarding — It’s Probably Not What You Think
Binoy Kampmark
The Perils of Certainty: Obama and the Assad Regime
Roger Annis
State of Emergency in Crimea
Soud Sharabani
ISIS in Lebanon: An Interview with Andre Vltchek
Thomas Knapp
NATO: This Deal is a Turkey
November 24, 2015
Dave Lindorff
An Invisible US Hand Leading to War? Turkey’s Downing of a Russian Jet was an Act of Madness
Mike Whitney
Turkey Downs Russian Fighter to Draw NATO and US Deeper into Syrian Quagmire
Walter Clemens
Who Created This Monster?
Patrick Graham
Bombing ISIS Will Not Work
Lida Maxwell
Who Gets to Demand Safety?
Eric Draitser
Refugees as Weapons in a Propaganda War
David Rosen
Trump’s Enemies List: a Trial Balloon for More Repression?
Eric Mann
Playing Politics While the Planet Sizzles
Chris Gilbert
“Why Socialism?” Revisited: Reflections Inspired by Einstein’s Article
Charles Davis
NSA Spies on Venezuela’s Oil Company
Michael Barker
Democracy vs. Political Policing
Barry Lando
Shocked by Trump? Churchill Wanted to “Collar Them All”
Cal Winslow
When Workers Fight: the National Union of Healthcare Workers Wins Battle with Kaiser
Norman Pollack
Where Does It End?: Left Political Correctness
David Macaray
Companies Continue to Profit by Playing Dumb
Binoy Kampmark
Animals in Conflict: Diesel, Dobrynya and Sentimental Security
Dave Welsh
Defiant Haiti: “We Won’t Let You Steal These Elections!”
November 23, 2015
Vijay Prashad
The Doctrine of 9/11 Anti-Immigration