Joe Conason's Journal

Tom White says he feels our pain over Enron.

Published July 18, 2002 3:16PM (EDT)

The man who knew nothing -- except to sell
You will surely be relieved to learn that if you were damaged by the collapse of crooked Enron, Thomas White shares your pain. He must, because he said so under oath today before the Senate Commerce Committee. "I am ashamed of what happened to that corporation and the damage that it has done to all of us,'' said the Army Secretary, who said that like everyone furious over Enrons scamming, he wants "to hold people accountable who were responsible" for the "absolute terribly tragedy that has occurred." He is "appalled and outraged."

Notwithstanding his fury at his old colleagues, the former vice-chairman of Enron Energy Services is also -- as this lovely chart created by the staff of Sen. Barbara Boxer, D-Calif., illustrates -- very, very rich. As you may know already, he made a lot of money dumping Enron stock in the months before the final crash. He said that his dozens of telephone conversations with Enron officials during that period had nothing whatsoever to do with his decision to unload his shares. "I am ashamed of what happened to that corporation and the damage that it has done to all of us." Of course its done a bit more damage to other shareholders and employees than to Secretary White. Its reassuring that he is so "appalled and outraged" anyway.
[Posted: 2:05 p.m. PDT, July 18, 2002]

Where greed is still good
Today's lead editorial in the Wall Street Journal is a diatribe against Alan Greenspan, once a great leader of the "Reagan Revolution." The editors attempt a sardonic tone, but the overall effect is more like a milquetoast purge trial. In light of his sensational remarks about greed and regulation before the Senate on Tuesday, Comrade Greenspan (described as "Ayn Rand's star pupil" and "the nation's most famous libertarian") is busted for left deviationism and then blamed for the falling Dow. For the right-wing radicals, it's darkness at noon.

Crimson faced
Harvard may soon have to change its motto from "Veritas" to "omerta." The university investment managers who put $30 million into foundering Harken Energy either aren't talking or can't remember anything. Michael Eisenson, who sat on Harken's board with George W. Bush, refused an interview with the Globe's Michael Kranish because Harvard Management told him to clam up. More mysteriously, the company's founder, Phil Kendrick, can't recall how or why the money started to flow from Cambridge. "All of a sudden the name 'Harvard' turned up," he said.

One obvious answer
Another former Harken stockholder who wouldn't talk to the Globe about that financial dry hole is liberal billionaire and philanthropist George Soros. He did, however, speak with David Corn of the Nation. The lead is buried well into the piece, when Corn finally corners Soros at a Washington party and asks for his recollections of Bush and Harken. The answer is revealing: "I didn't know him. He was supposed to bring in the Gulf connection. But it didn't come to anything. We were buying political influence. That was it. He was not much of a businessman."

Now that's an interesting reply, even discounting for possible political bias. Corn's moment with Soros was very brief, so they didn't get to the conclusion of his involvement with Harken. According to its 1989 annual report, Harken repurchased the entire Soros stake -- nearly 7 million shares costing more than $29 million. Soros had invested his own money, along with significant amounts from two of his investment funds, his foundation in Hungary and the Soviet Union and his Open Society Fund. Apparently Soros was growing impatient with the inability of the president's son to arrange deals in the Persian Gulf countries. He unloaded his stock on July 12, 1989. Six months later, Harken signed its controversial exclusive contract with the sheikdom of Bahrain to drill offshore. But billionaires are often lucky as well as smart. Years later, those turned out to be dry holes, too. And Bush had long since dumped Harken himself.
[Posted at 8:24 a.m. PDT, July 18, 2002]

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By Salon Staff

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