The bankruptcy of Enron
signaled not only the destitution of thousands of workers, not only
the elimination of life savings for thousands of investors, not only
the eradication of $70 Billion in shareholder equity, it also pronounced
the total collapse of Republican conservative ideological positioning.
Reagan marched into the presidency with the carefully formulated position
that governmental regulatory control was the problem with America.
The so-called free market would police itself. If a company was inefficient,
it would collapse. The rigors of market competition would bring everything
in line. He did not say that corruption would cause companies to collapse,
not competition. He did not say that these companies would buy favors
from Republicans, and where necessary from Democrats in order steal
billions of dollars from the taxpaying public. He did not say that
that these companies, through deregulation would accumulate gigantic
sums of money that would then be used to corrupt the democratic process
and actually buy the presidency as happened after Reagan marched into
the presidency.
The other side of deregulation was and is theft, corruption, lies,
graft, fraud, political payoffs, and political intrigue. That was
left out. Reagan, of course, did not formulate these positions; he
merely acted out the role assigned to him by far more powerful and
devious people.
The other side of Republican ideological positioning was euphemistically
styled as wedge politics. Capitalism or market politics could not
and would not mobilize a majority of the populace. While government
was to be eliminated in terms of regulating business, it would be
expanded in regulating individuals. Women would not have the right
to choose, religion would no longer be a matter of individual, private
decision but would be imposed by the state including requiring children
to adhere to state sponsored prayers, African-Americans would not
be allowed to have an even playing field in the search or jobs and
other opportunities, workers right to organize would be attacked and
eliminated if possible. Sexual preference, of course, was never considered
a private individual matter; the state would make those decisions.
One observer characterized the Republican platform as a program to
get government out of the boardroom and into the bedroom.
To say the least, this platform is a hard sell. It does not serve
the interests of a majority of the people. Taken as a whole, this
platform is against both the economic interests and the individual
preferences of a majority of working people. It could never mobilize
the energy and loyalty of millions of working people. Brilliantly,
the Republican ideologues devised a strategy of hate and . ruthless
assault on all principles of decency. The plan of attack reached full
fruition with the “southern strategy” articulated by Richard
Nixon.
What we see today is political unity between the most reactionary
elements of the country and a section of capital. This was accomplished
by the use of wedge politics with a concentration in the South. Wedge
politics is essentially a euphemism for hate politics. By driving
a wedge between white and black workers, between men and progressive
women, between straight and gay workers, even between national minority
workers and other workers, Republicans backed by a section of capital
were able to create one issue Republicans. By being blinded by hate
or anger or fear, one issue Republicans can be convinced to vote against
their own economic self-interest.
The base for wedge politics is racism. That is why the first and most
successful use of this strategy occurred in the South. Attacking liberals
as rich eastern capital, the Republican Party was able to posture
itself as the friend of the white working man. Thus, the term limousine
liberal. This strategy mobilized white men by opposing affirmative
action first. Of course, code words were developed; opposition was
to quotas, not affirmative action. Then, having demonized those in
“favor” of quotas, the right wing then demonized those
in “favor” of affirmative action. The same process was
used for those struggling for women’s rights. First, attack
feminists. Then, the right to choose. First, oppose restrictions on
hunting then all restrictions including assault rifles. Then, the
right wing always had its ace in the hole by attacking sexual preference.
But taken as a whole, the entire program was and is one of hate. White
working men could only be mobilized against their self-interest if
sufficient anger would blind them and hate is a blinding force. That
is why demagogues are so successful.
The right wing spent years in ideological bombardment. During the
1960’s and 1970’s, even words such as altruism, compassion,
and generosity were under attack as the positions of knee jerk liberals.
Any effort to address the needs of working people was attacked as
wrongheaded , at best and probably evil.
The other side of this ideological attack was to demonize welfare
recipients thereby convincing the white working man that his economic
problems were caused by a government that catered to the poor, not
working people. The facts never got in the way. Whenever welfare was
discussed, the recipient was black thereby combining two sources of
anger even though a majority of recipients are white. Most welfare
recipients work when possible but that fact is never discussed. Most
importantly, there was never any discussion of the fact that capitalism
cannot and will not provide full employment and there must be a reserve
army of the unemployed to keep wages down. Then it would be recognized
that welfare payments help working people, especially the white working
man.
By attacking the welfare queen, the government not capitalism becomes
the enemy of working people. The ultimate agenda is to de-politicize
the working class so that it will not grasp its immediate task which
is to unify against its class enemy. As a result, the white working
man is given a few small privileges and African-Americans, women and
other national minorities are left to fight among themselves.
But the foundation for this strategy is that the market will function
reasonably well. It will hand out a few crumbs and for those who are
angry but not greedy that will be enough. The Republican right wing
took the position that the privileges and stratification that existed
with regulation would continue only the market would be more efficient
in handing out the privileges and would never attack the existing
stratification. Instead, unregulated capitalism fostered corruption.
It corrupted the corporate structure itself and then it corrupted
the political system. With the incredible concentration of wealth,
it then turned on the democratic process itself. It tried to buy the
presidency for Bush II and when that failed the right wing cabal surrounding
Bush II literally stole the election. The complete and total collapse
of Enron, however, exposed the madness for what it is. Weakly, the
right wing now argues that it is a bipartisan problem, once again
seeking a shield against the true story. Not only is this right wing
cabal at fault for the loss of $70 billion, it is wrong as to the
solution.
The coverage of the Enron situation has primarily focused on the
disintegration of a powerful corporation due to the deceit and criminality
of those who ran the company. The few reporters who have looked below
the surface have proven linkage between Enron's corruption and its
political connections to the Bush administration. David Podvin, Multitrillion
Dollar Financial Scandal, http://www.rense.com/general19/multitrill.htm
The media intentionally hides the involvement of the Bush cabal in
this scandal. More importantly, it hides the ideological bankruptcy
that caused this scandal. Whitewater involved $100,000.00 and resulted
in a $50,000,000.00 investigation. This involves $70 Billion and there
is no investigation let alone impeachment. The program of the right
wing Republicans has set up a situation which can very well lead to
total collapse and certainly has led to the necessary elimination
of the unregulated economy.
“Enron’s duplicity is an extreme symptom of a financial
cancer that threatens the health of the economy. The disease is a
malignant accounting method that has received legal protection from
conservative politicians on behalf of their corporate benefactors.
It is called ‘pro forma’. Originally intended to allow
companies to compensate for extraordinary events that distorted their
financial reports, the pro forma accounting method has led to the
greatest fraud ever perpetrated.” Podvin, supra
(Emphasis added)
Because the right wing actually believes that the market economy will
work despite the evidence to the contrary, the Republican right wing
always ignores and denies the necessity for governmental regulations.
The market economy necessarily and always creates a concentration
of wealth that is unfair, oppressive, repressive and exploitative.
By concentrating wealth in the hands of the very few, capitalism destroys
the buying power of the working people. Working people create enormous
wealth that is then sucked off by the most corrupt and greedy capitalists
as happened with Enron. The production of goods results in overproduction
because working people have no money to buy what they have produced.
Simply put the market economy does not work. Never has and never will.
Government enters to make it work or at least give a semblance of
working order. The first step in making the market economy work is
the redistribution of wealth. But since the concentration of wealth
allows these corrupt capitalists to buy politicians, the redistribution
is blocked.
Economists dub themselves practitioners of the dismal science. More
appropriately, these so-called scientists should be dubbed capitalist
apologists, not scientists at all. For a price, they rename market
failure and say it is necessary for progress. They even have mathematical
formulas to support their hogwash. Now, their position is that current
problems are temporary adjustments on the road to globalization which
will lead to progress for all.
These apologists know better. They are no different than the streetwalker
who promises to go around the world for $50.00. These apologists promise
an efficient system governed by the invisible hand. They charge huge
sums of money when they know that the invisible hand does not work
and the unregulated market leads only to hunger, destitution, exploitation,
and disorganization. A system that rewards the most greedy and corrupt
will inevitably lead to greed and corruption. It cannot regulate itself.
At least the streetwalker is honest in the assessment of the service.
Regulating capitalism curbs the most harsh results and reduces suffering.
It does not address the problem which is the market itself and the
concentration of wealth in the hands of the most corrupt among us.
“Freed from concerns about regulatory oversight, this country’s
biggest companies became dramatically more ‘creative’
with their earnings reports. Current estimates for S&P 500 corporations
are that they have collectively earned about $410 billion in 2001
when using the pro forma accounting method. However, when using GAAP,
they have collectively earned about $240 billion.
Those who claim that Enron was an exceptional case are technically
correct. While Enron overestimated its earnings by 100%, the average
large publicly held corporation is overestimating its earnings by
only 42%.
IBM reports pro forma earnings. So does Intel. And Cisco Systems.
And Dell. And Sun Micro. And Motorola. And Microsoft. And. . . By
engaging in such manipulation, with the assent of accountants and
governmental oversight agencies, Corporate America has conned the
public into investing trillions of dollars based on phony earnings.
Cisco, for example, has used its artificially inflated stock price
as capital to acquire other companies. Many corporation empires have
been built on such accounting legerdemain, including General Electric
(NBC), Viacom (CBS), Disney (ABC), AOL/Time Warner (CNN< Time Magazine),
News Corporation (Fox), the Washington Post Company (Washington Post,
Newsweek), the Tribune Corporation (Chicago Tribune, Los Angeles Times,
and the New York Times Company (New York Times, Boston Globe).
Enron is the tip of an iceberg on which sits the entire mainstream
media. A national association of accounting firms has called on the
Securities and Exchange Commission to require all publicly held corporations
to report real GAAP earnings. The return to ethical accounting standards
would mean that, in order to reflect the current valuation of the
Dow industrials. The average would fall to 5825. In order to reach
the historical norm based on GAAP, the Dow would decline to 3300.
A major decline in stock prices would erase trillions of dollars of
investors’ wealth. With the uninformed public currently heavily
invested in the market., this would have crushing impact on the finances
of the average American.” Podvin, supra.
The problem is not simply a business matter as Bush II contends. It
is matter of political ideology proven bankrupt.
“In 1995, Senate Republicans and almost half of the Democratic
colleagues joined to override President Clinton’s veto of legislation
providing corporations with protection from shareholder lawsuits.
The leader of the effort to dramatically reduce civil liabilities
for companies that report phony earnings was Wall Street lobbyist
Harvey Pitt, who has made a career of defending the shady dealings
of stock market thieves like Ivan Boeshy.
Just as his father hid the magnitude of the Savings and loan scandal
until after the 19878 election, Bush is desperately trying to obscure
the truth about Corporate America’s financial slight of hand
in order to defer the tumbling of the house of cards until after the
2004 campaign. He expects to be helped in this effort by the man he
appointed to be Chairman of the Securities and Exchange Commission
, the one who is most responsible for seeing that corporations accurately
report their earnings . Harvey Pitt.” Podvin, supra.
Because the media is totally dominated by the right wing ideologues
, they have no idea of the effect of their positions. Nor do they
believe anyone will ever decipher their duplicity. One commentator
stated without the hint of a smile that Bush II is now viewed as a
James Bond type.
Millions of people know the Bush cabal stole the election, and sacked
the American treasury. They stole the election and now it comes out
that Kenneth Lay of Enron helped to finance the attack on Florida.
The corruption is like a huge pile of dung with everyone saying it
does not stink. While a level of pessimism creeps into our work, one
must remember that President Johnson constantly pointed to his polls
as proof that the War in Vietnam was popular. That the American people
supported the war. Now John Ashcroft states that anyone who disagrees
with him either supports the terrorists or is a traitor. Johnson could
not maintain his position and that was when jobs, education, health
care and housing were more readily available to working people than
now. The tax system then was progressive even if it was unfair to
working people. All of that has been wiped away. Bush II will have
considerable difficulty convincing people that they must endure this
hardship while he gives the country away to the richest people in
the world.
A specter haunts the world today. Even if it is not the specter of
proletarian revolution outlined by Karl Marx, it is a specter of total
failure of capitalism. Capitalism is destroying the living environment
of the world. It creates chaos, anarchy, war, terrorism and murder.
Religious fanaticism is countered by repression and murder. This specter
of disaster is manifested by working people buying water to drink
when they can, getting sick from fouled air and not having any health
care to address the problems. War and anarchy are not only real but
expected.
The only answer provided by the right wing is globalization which
comes at prices no one can afford and the product is deficient anyway.
Globalization represents the destruction of civilization, the concentration
of wealth in the very, very few and the destitution of the world’s
peoples. In return they are given religious fanatics to lead them
out of this hell.
In these conditions, the Bush cabal will be put on notice that they
will be destroyed in the wake of the demand for jobs, peace and equality.
