There's another Enron out there:
February 10, 2002 6:57 AM   Subscribe

There's another Enron out there: Global Crossing. Same tale on a slightly smaller scale, but one big difference - the politicians who benefited were mostly Democrats.
posted by Jos Bleau (18 comments total)
From the story you linked: "Of its total $3.6 million in contributions since 1998, Republicans pocketed 53%, Democrats got 47%."

How does that equal "mostly Democrats"?
posted by rcade at 7:27 AM on February 10, 2002

Obviously Bill Clinton cooked the numbers somehow.
posted by MegoSteve at 7:28 AM on February 10, 2002

Rrcade, the figure you site is for direct campaign contributions. That buys one kind of influence, but giving multiple Dem party appratchicks & adminstration insiders multi-million dollar sweet-heart deals, donating $1 mil to the Clinton Library, and providing a base of operations for the party's chief fund-raiser buys a different order of magnitude of influence. Yup, Bush-the-father (and other Repubs) got some suger too, but that does not mean that GC influnce buying wasn't heavily tilted towrad the Dems.
posted by Jos Bleau at 7:40 AM on February 10, 2002

Jos, this Global Crossing company appears to have just gone nutso with campaign contributions to everyone, not just Democrats. I get the feeling that if a Republican had been President, they would have given $1 million to their presidential library. The impression I got is that they just threw money at those who happened to be here.

Now, admittedly, that's bad. But it's quite different from Enron, where the company cultivated a very very strong relationship with George W. Bush and many other Republican higher-ups. This sounds like, to me, Republicans desperately eager to try and get some sort of scandal, anything on those Democrats to distract from the mess.

And for me, the main benefit/crime of the Enron debacle has less to do with political clout than with the absolute amoral crassness of modern business. The naked greed and gluttony of the Enron execs, as well as their pitiful financial shell game, should stand as an object lesson regarding modern capitalism: little to do with free enterprise or markets, but plenty to do with stuffing executives' pockets with money.
posted by solistrato at 7:55 AM on February 10, 2002

whether it's more democratic or just 50/50, it's pretty telling that GC is not getting anything near the saturation coverage form the media that Enron is.
posted by nobody_knose at 7:56 AM on February 10, 2002

Okay... let me get straight on this... so the fact that Democrats are dirty too makes it okay that our executive branch is a wholly owned subsidiary of a private consortium of energy industry concerns that includes the most spectacular case of corporate corruption in recent memory, a concern whose former CEO's close relationship with our President can't help but bring into further question his legitimacy as chief executive. Thank you, Mr. Perkins, for clearing that one up for us.

Diversion of attention by pointing out "but, but, he did it too!" with quivering lip is a fairly disingenuous argument. Not that I expect too much more from Perkins, given what I know of his track record.

Jos: I don't see much of a difference at all between GC and Enron at all. The fact that Democrats got some cash for some favors is irrelevant, and it certainly doesn't make Dubya and his cronies any less guilty. The point is that corrupt corporate America has too much traction with corrupt government, and that influence subverts the purpose of government in the first place. I'm glad it's more widespread - maybe enough public outrage will get whipped up that we'll finally put a stop to the primacy of big corporate interests in public policy decisions.
posted by Vetinari at 8:02 AM on February 10, 2002

From another source: "Since 1997, the company’s giving appears to have been meticulously evenhanded, with money going to members of both parties."
posted by rcade at 8:06 AM on February 10, 2002

Didn't the Global Crossing situation break a little later than Enron? Right at the top of Google sit 3 news stories from the past 3 days, at the NandoTimes, Reuters, and Smart Money. Smart Money's story, dated Feb. 8, says the FBI has begun a "preliminary investigation" of GC's accounting practices. Hopefully there will be some synergy and lessons learned from the Enron investigation, so that Congress and the SEC don't have to keep reinventing the wheel. The SEC is holding a big "shindig" in May, which should leave adequate time to address both situations.
posted by sheauga at 8:56 AM on February 10, 2002

Even better. Try the Global Double Crossing site. Probably more funny if you've worked with Global Crossing's website or are a pissed off investor or employee.
posted by jmccorm at 9:04 AM on February 10, 2002

Vetinari: Of course that makes it all right! Don't you know we live in an age of moral relativism? If it's less bad than what the bad guy did, it's good!
posted by five fresh fish at 9:25 AM on February 10, 2002

Ah, so that's where my 10 cents a minute was going...
posted by mrbula at 9:47 AM on February 10, 2002

Jos, it's *CITE* as in citation, not site as in Web Site. I guess another one of my pet peeves is the term "Web Sight" which has cropped up a lot...
posted by mikojava at 10:05 AM on February 10, 2002

Massive corporate fraud that ripped off both rich and poor alike with the complicity of both bought major political parties is a recipe for a major crisis of confidence in the financial sector. That the price of gold is rising, likely due to the inability of gold to issue bogus financial reports, is a good indicator of the lack of confidence.

While Republican strategists spreading the blame around are masterfully handling this entire situation at a political level they are completely avoiding the real issue. Namely, what do we do now? Regulation? Business as usual?

It might be fun to have another special prosecutor looking at metaphorical (instead of actual) dirty laundry but I would rather see some changes in regulations for campaign finance and corporate accounting than endless useless and expensive recrimination. But then I am neither a lawyer nor a journalist.
posted by srboisvert at 10:08 AM on February 10, 2002

Enron was No. 7 on the Fortune 500. Of course it's going to get more attention, even without the impossibly deep ties to the Bush administration. Enron's bankruptcy case is also the largest in U.S. history, and easily dwarfs the closest competition, which includes Global Crossing. No one's making a big hoo-hah out of nothing with the Enron story. No biased leftie reporter is pulling anything out of his or her ass here, and wrongly claiming that the implosion is Big Big Big News.

Does the author know, in any case, that yet another Fortune 500 company, Comdisco (No. 433) filed for bankruptcy protection in July? And that Comdisco's CEO sits on Enron's board of directors? Oh, and Andersen was also the accounting firm for Global Crossing.
posted by raysmj at 12:21 PM on February 10, 2002

Mikojava - thanks for the correction.

Vetinari (and others) the point of my post wasn't 'look how bad the Dems are, the Repubs must therefor be good' it was that we have heard very little about an very near Enron-magnitude scandal. True, GC only went bankrupt two weeks ago, but their stock has been practically worthless since last summer when they lost their big DoD contract amid charges of bid-rigging and previous admin insider hijinks. So the GC, meltdown is arguably an older story. But since it deosn't fit the script (Bush is owned by energy companies), we haven't hear much about it.

srboisvert you are dead right about corporate fraud - and there are good journos out there who'll tell the story. Check out this non-partisan article on how Wall Street insiders and analysts got sweet deals on Enron partnerships - the same folks who sold their small-investor clients down the river with buy-ratings right up to the bankruptcy filings .... but since the the smoking guns of influence don't point the right way (boring and hard-to-understand finanacial transactions, not smug ole Bush), it's unlikely it'll get much play ....
posted by Jos Bleau at 12:27 PM on February 10, 2002

Jos Bleau: I think it's a conspiracy that the Kmart bankruptcy won so much attention, and Global Crossing's didn't. Must be some Republican high up in the ranks at Kmart. Sheesh. Enron was a Top 10 company, and its bankruptcy is the largest, ever, and of considerably greater impact than Global Crossing's, given how far its tentacles reached. The deep Bush administration ties make it an even a bigger story. The Enron story is also connected to a much larger story of financial shenanigans (which has been covered) that led to a stock market bubble in the late 1990s. Thus it was a gigantic and hugely symbolic story even without the political connections, just as the Kmart story was and is (and its bankruptcy is connected to Enron's) symbolic of American in Recession.

Oh, and no Democrat rules over the executive branch at the moment. I don't remember hearing anything negative about Clinton when he was in office - or just out, with the Marc Rich thing.
posted by raysmj at 1:53 PM on February 10, 2002

Actually, raysmj, I don't think that the Kmart Bankruptcy has won all that much attention - 5 threads (before this one) as opposed to 74 for Enron when I searched the last month on MeFi. And I bet a survey of news outlets and congressional testimony would show a simular imbalance. But you know what - I think that that's about the right amount of coverage for Kmart. I'm certainly not aware of any criminal investigations of Kmart, and most of the stores are still open and emplyees still employed. It seems to be a story of business failure, not of political, accouting, investor, or pension plan wrongdoing. And I think you'll find that their bankruptcy had more to do witt picking a fight they couldn't win (competing against Wlamart on price) than with Enron or with America in recession.

I never said that Repubs (or anyone else) should get a pass on Enron wrongdoing because of GC's wrongdoings, only that there is a smaller scale version of the Enron scandal that (to my interpretation) profited Dems more than Repubs.

And in my subsequent posts I never impuned conspiracy, as I think you imply. But I do think that people who imply that the story should be about something more "Enron was Bad/Enron Owned Bush/Therefor Bush is Bad" are going to be treated sternly or ignored.

Sorry if I wondered off-script.
posted by Jos Bleau at 2:31 PM on February 10, 2002

Jos Bleau: People who imply that the story is about something more than Bush are going to be ignored? Like who? Rep. Billy Tauzin (R-La.)? (Oh, Global Crossing is still in bidness too. It has a deal with NBC related to Winter Olympics coverage.) In any case, in talking about "American in Recession" and whatnot, I'm talking about why newspapers put the Kmart story on front pages, not my personal opinion. Global Crossing didn't become front page news mainly because it's just another New Economy high-tech bubble company gone kablooey, even if it was larger (telecom companies have a particularly rough time). Enron showed signs of systemic chicanery in the general economy that are much more troubling.
posted by raysmj at 2:51 PM on February 10, 2002

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