FacebookTwitterGoogle+RedditEmail

Employees Charge Enron With Theft Before Senate

by Jordan Green

On Dec. 18, the Senate Commerce Committee heard from former employees and shareholders of the collapsed energy trading company Enron, who watched retirement plans tied up in the company’s stock vanish while executives cashed theirs out.

Mary Baines Pearson, a 70-year-old Enron shareholder and widow of former Texas state representative G.P. Pearson, told the committee, “I am just a pebble in the stream, just a little bitty stockholder, but both my granddaughter and I have lost money we had set aside for our future and do not know how we will replace those losses.”

Charles Prestwood, a 63-year-old retired Enron employee from Conroe, Tex. said, “I can tell you, without pulling punches, something stinks here. There are people at Enron who made millions selling Enron stock, while we, the rank and file, got burned.”

Implicit in their testimony before the Commerce Committee was a plea for Congress to take action to force the company ? whose CEO Kenneth Lay has earned $300 million through stock options ? to make reparations to its employees.

Said Robert Vigil, an electrical machinist who worked for 23 years at the Pelton/Round Butte Hydroelectric Project in Madras, Ore., “We are looking for solid, truthful answers so that we may possibly recoup some of this money, maintain our dignity and prevent further theft from occurring to others who work their entire lives only to become victims of robbery.”

Enron’s case has moved more quickly than many business and government observers anticipated. The company was President Bush’s largest campaign contributor and its proximity to political power in Texas while Bush was governor afforded it an advantage in influencing the revolutionary deregulation of energy markets. The close relationship has continued. Last April, CEO Lay was consulted by Vice President Dick Cheney’s secret energy task force.

Congressional initiatives have so far focused on chiding employees’ reliance on company stocks for their retirement plans ? even though employees say they were pressured into buying the stocks and were locked into the retirement plans as it became apparent that the company was in trouble. In contrast, there has been little attention paid to the company’s liability for its employees’ financial devastation and the top executives have so far ignored calls to testify before Congress.

Sen. Barbara Boxer (D-Calif.) and Sen. Jon Corzine (D-N.J.) introduced legislation on Dec. 18 that would limit company stocks to 20% of employees’ overall retirement packages. If passed, this law could affect companies like Coca-Cola, Texas Instruments and McDonalds whose retirement plans are comprised of 60% company stock.

“We want to make sure that the life savings of our nation’s workers are protected ? even when an employer’s stocks collapses,” said Sen. Boxer.

The slow crawl of justice may accelerate this month as the Senate Committee on Governmental Affairs conducts new hearings on Enron on Jan. 24. Congress issued 51 subpoenas last Friday relating to the company’s conduct.

Perhaps sensing a process that has slipped from its grasp, the Bush Administration has made a hasty attempt to control the damage. On January 10, President Bush made a terse statement before the press: “There needs to be a full review of disclosure statements to make sure that the American stockholder is protected.”

The Justice Department announced that it was forming a special task force of prosecutors to conduct an inquiry into Enron’s collapse. Attorney General John Ashcroft recused himself because of possible conflicts of interest due to campaign contributions he accepted from Enron during his failed 2000 Senate race.

Enron’s lawyer Robert S. Bennett lauded the Justice Department’s decision to take the case. “I’m pleased that there now appears to be some centralization and coordination, because it is very difficult and expensive to deal with half a dozen other entities,” said Bennett. “This is a company in bankruptcy, and it needs to be given a fair shot to come out of bankruptcy and increase the value for shareholders. If we get caught in a cumbersome scandal machine, that may not happen.”

Meanwhile, Enron is anxious to auction off assets around the world ? including a mega-dam in India, which has inspired massive protests by displaced farmers. Officials at the company worry that employees will flee as corporate control breaks down. Earlier this month, the London-based investment bank UBS Warburg beat out BP and Citibank for control of Enron’s energy trading business, while Houston-based Dynegy has already finalized an agreement to take over the prized Northern Natural Gas Pipeline, which runs from Texas to the Canadian border.

Jordan Green is Editorial and Research Associate at the Institute for Southern Studies.

More articles by:

CounterPunch Magazine

minimag-edit

bernie-the-sandernistas-cover-344x550

zen economics

December 06, 2016
Anthony DiMaggio
Post-Fact Politics: Reviewing the History of Fake News and Propaganda
Richard Moser
Standing Rock: Challenge to the Establishment, School for the Social Movements
Norman Solomon
Media Complicity is Key to Blacklisting Websites
Michael J. Sainato
Elizabeth Warren’s Shameful Exploitation of Standing Rock Victory
David Rosen
State Power and Terror: From Wounded Knee to Standing Rock
Kim Ives
Deconstructing Another Right-Wing Victory in Haiti
Nile Bowie
South Korea’s Presidency On A Knife-Edge
Mateo Pimentel
Some Notes and a Song for Standing Rock
Bill Fletcher Jr – Bob Wing
Fighting Back Against the White Revolt of 2016
Peter Lee
Is America Ready for a War on White Privilege?
Pepe Escobar
The Rules of the (Trump) Game
W. T. Whitney
No Peace Yet in Colombia Despite War’s End
Mark Weisbrot
Castro Was Right About US Policy in Latin America
David Swanson
New Rogue Anti-Russia Committee Created in “Intelligence” Act
George Ochenski
Forests of the Future: Local or National Control?
December 05, 2016
Bill Martin
Stalingrad at Standing Rock?
Mark A. Lause
Recounting a Presidential Election: the Backstory
Mel Goodman
Mad Dog Mattis and Trump’s “Seven Days in May”
Matthew Hannah
Standing Rock and the Ideology of Oppressors: Conversations with a Morton County Commissioner
Kevin Zeese - Margaret Flowers
#NoDAPL Scores Major Victory: No Final Permit For Pipeline
Fran Shor
The End of the Indispensable Nation
Michael Yates
Vietnam: the War That Won’t Go Away
Michael Uhl
Notes on a Trip to Cuba
Robert Hunziker
Huge Antarctica Glacier in Serious Trouble
John Steppling
Screen Life
David Macaray
Trump vs. America’s Labor Unions
Yoav Litvin
Break Free and Lead, or Resign: a Letter to Bernie Sanders
Norman Pollack
Taiwan: A Pustule on International Politics
Kevin Martin
Nuclear Weapons Modernization: a New Nuclear Arms Race? Who Voted for it? Who Will Benefit from It?
David Mattson
3% is not Enough: Towards Restoring Grizzly Bears
Howard Lisnoff
The Person Who Deciphered the Order to Shoot at Kent State
Dave Archambault II
Standing Rock Sioux Tribe Statement on Dakota Access Pipeline Decision
Nick Pemberton
Make America Late Again
Weekend Edition
December 02, 2016
Friday - Sunday
John Pilger
The Coming War on China
Jeffrey St. Clair
Roaming Charges: The CIA’s Plots to Kill Castro
Paul Street
The Iron Heel at Home: Force Matters
Pam Martens - Russ Martens
Timberg’s Tale: Washington Post Reporter Spreads Blacklist of Independent Journalist Sites
Andrew Levine
Must We Now Rethink the Hillary Question? Absolutely, Not
Joshua Frank
CounterPunch as Russian Propagandists: the Washington Post’s Shallow Smear
David Rosen
The Return of HUAC?
Rob Urie
Race and Class in Trump’s America
Patrick Cockburn
Why Everything You’ve Read About Syria and Iraq Could be Wrong
Caroline Hurley
Anatomy of a Nationalist
Ayesha Khan
A Muslim Woman’s Reflections on Trump’s Misogyny
Michael Hudson – Steve Keen
Rebel Economists on the Historical Path to a Global Recovery
FacebookTwitterGoogle+RedditEmail