Enron: The Smartest Guys in the Room

A good overview of the Enron story, its main players and their basic dramas.

Only in passing does it place the Enron phenomenon in its historical context, but there’s only so much time. For an overview of why Enron happened in the first place, I recommend The Corporation.

The key to a thing like Enron is the Milgrim experiment, which the film discusses at length. For those unfamiliar, Milgrim had one guy pose as a scientist and another guy pose as a test subject, and then asked normal people to come in and participate in some “scientific research.” He said that he wanted to learn if electrical shocks would help improve memory.

This was all a Mametesque put-on. There was no experiment, at least not involving electrical shocks.

The “scientist” was in the room with the normal person, and the “test subject” was in another room, unseen. The “scientist” would tell the normal person to increase the power of the electric shocks, the normal person would push a button and the “test subject” would scream in agony as the “shocks” got progressively worse and worse. The “experiment” would continue until the “test subject” was either dead or the normal person said that he wouldn’t push the button any more.

What Milgrim found was that over half of the normal people would gladly, even enthusiastically, kill the “test subject” just as long as the order to do so came from a legitimate enough authority figure.

A simple form of this can be found in, say, a restaurant, where you get bad service from a surly waiter. Why is the waiter angry? Probably because he’s treated badly by the manager, who is being squeezed by the owner to cut corners and maximize profits.

So the Enron story is about a handful of deeply unethical, conscience-free, amoral monsters who set the agenda for one of the largest corporations in history. They told their employees, by example and by direct order, that anything they did to make money for the corporation was not only good, but would be rewarded. And so the employees, and everyone working with the corporation, including banks and contractors and lawyers and accountants, enthusiastically participated.

Eventually, “anything” came to include a rainbow of fraud, theft, destruction and death.

Nazi Germany, same thing.

And the current administration.

And Hollywood.
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21 Responses to “Enron: The Smartest Guys in the Room”
  1. urbaniak says:

    And our Livejournals. Say it.

    Actually I’m obsessed with Enron. I own three books on the subject. Yet bizaarely I have not yet seen that film. I am going to go the store and get it today.

  2. eronanke says:

    I firmly believe that people, as a whole, don’t like the idea of standing up for what is morally right by themselves; that is why it takes so long for social and ethical change – one person is needed to start a movement, but that one person, unfortunately, one of us, and we’re all pretty afraid/apathetic.
    Me, I’d love to help Africa better adjust to a free-market and vaguely democratic world. But, because I am an individual, without guidance, I fear taking solitary action against the behemoths of the world, whether government or corporation or NGO. I feel the same happened to lower-level insiders within Enron who knew what was occurring, but were too afraid to stop it.
    That being said, we must have faith in humanity. After all, it has taken us this far, no?
    PS- My father did a similar psychological experiment at the University of Jerusalem, I believe, about 30 years ago, where he was told to stay in a room and shock a mouse with low-levels of electricity. His handler was a pretty, young, psych-student there, and she had told him that she, herself, was deathly afraid of mice. She told him to stay and keep shocking the mouse no matter what happened. The real test, however, was not to see if he would feel sympathy for the mouse, but, when the woman left the room, two minutes later my father heard her begin shouting that the mice had escaped, and began screaming and crying. He, being a jackass, did what was expected in the test: he stayed exactly where he was an continued shocking the mouse.
    Some gentleman, huh?

    • greyaenigma says:

      I tend to think the there’s different factors between the powerless intertia and the obedience inertia. I’d like to think I wouldn’t kill a test subject, or that I would have helped the young lady with her mice problem, but I did let Teller apparently die on stage, so there’s that.

      I have taken actions against the current regime, but there’s so far one can go as a non-behemoth. It’s not like I’m a widely popular celebrity or anything.

      • eronanke says:

        It’s so strange that we’re discussing this; I’m currently obsessed with “V for Vendetta”, which, for me, is less about terrorism, and more a commentary on the exact same obedience and powerless inertia I think you’re talking about, (especially if you read the graphic novel).
        I mean, we venerate people who begin revolutions and social movements; Che, Gandhi, Jesus, Buddha, and, also, vilify those who fail, like Guy Fawkes, the Weather Underground, the PLO, Marx (and communism in general), Castro, etc. But, in the end, we are so paranoid of how society will react, we rest on the comfort of what is provided by the status quo.
        I’m not a “Damn the Man” kind of girl, but, honestly, if I found someone who would lead a cause I believed in, I think I would be the type to drop everything and help… That being said, our society is so structured around tearing down celebrity and public personages, that I doubt one could last long enough for me to find them…

        • popebuck1 says:

          And bear in mind that the people who DO bring about sweeping changes are uniformly attacked, imprisoned, oppressed, and often assassinated for their troubles, even when their movements succeed in the long run. Not many people want to sign up for THAT part of The Struggle!

          • eronanke says:

            Amen. I mean, *I* wouldn’t want to hang on a cross… Or be shot… Or be in Turkish Jail for the rest of my life…

            • Todd says:

              I am absolutely sure that if Jesus had been married with children by the time he was thirty, the world would be a very different place today.

              • popebuck1 says:

                “It’s amazing how much your priorities change. Yeah, some of the guys – Simon and Judas mostly – are upset because I’m not as much into the ‘wandering the countryside preaching love and forgiveness’ thing nowadays. But I feel I’m much richer as a person, and we’ve both really grown as individuals since the kids came along. Want some tea?”

        • greyaenigma says:

          Message for the Action Man

          Yeah, that message was all through V, which may be why it’s going through my head lately as well.

          History is written by the victors, after all. If Germany had won WWII, we’d be talking about how great Hitler was, and can you believe those monsters the Americans actually used an atom bomb? (Assuming the Cold War between Germany and Japan is over. Hmm. I should watch Jin-Roh again.)

          I’m very much damning the man these days. What we need is a charismatic leader. A father figure, possibly, with a lineage of greatness — perhaps his father was a great explorer, or scientist? We might want to keep the mother out the picture (to avoid the Hilary treatment). Maybe a war hero or secret agent for a running mate. (Something to make both the macho men in denial and the ladies happy.) And he’d have to surround himself with advisors, people expert in matters spiritual (or occult — worked for Reagan) as well as someone kind of boyish, but still brilliant. And you’d want someone to capture the white vote, since normally the Republicans would have a lock on that. But who could possibly fit this profile?

          Only time will tell.

          • eronanke says:

            Re: Message for the Action Man

            (ha, ha)
            I’m so political, I’m a-political. May I quote Heinlein?
            “I don’t pay any attention to politics.”
            “You should. It’s only barely less important than your own heartbeat.”
            “I don’t pay any attention to that, either.”

            PS- I’m sorry, Todd, for getting off topic.

          • Todd says:

            Re: Message for the Action Man

            History is a story we tell ourselves to explain our present. That’s why it’s always changing. That’s why a great story, Hamlet say, or Jesus, is constantly being reinterpreted, because it doesn’t really matter if there was once a “real” Prince of Denmark who revenged his father’s death, or a “real” Nazarean who threw the moneychangers out of the temple. We’re not talking about what “really happened,” because a) we don’t know what “really happened” and b) it doesn’t matter what “really happened.” We’re imagining what happened based on our need to understand our present time.

    • Todd says:

      “I stand up for Liberty/but can’t liberate” — Graham Parker, “Don’t Ask Me Questions”

  3. r_sikoryak says:

    You know, if you’re going to tell us it comes to “fraud, theft, destruction and death,” you might want to say “Spoiler Alert!”