Sleestak, I don’t doubt that climate change is a complex field and in fact have copies of several recent articles from Science and Nature to prove it. But, that what the purpose of the IPCC and the NAS study (commissioned by Bush himself) is for…to assess the current state of the science for policymakers. Do you believe that both of these are somehow biased, wrong, or what?
At any rate, the point I was disputing in particular was not the science behind climate change but the claim that the Kyoto accords would totally kill our economy.
Mandelstam, I dont mean to minimize the importance of broad-based trends or of historical analysis. I admit some of my recent posts haven’t been models of clarity. So let’s return to the Greider article.
You cite Greider for three examples in response to my point that one must “show that deregulation caused (or that a given type of regulation would have prevented) the Enron failure.” :
401(k) regulation
Choosing corporate directors
The fact that a non-government board (i.e., FASB) sets accounting rules (plus an argument for public auditors)
Well, #1 wouldn’t have prevented the Enron failure, though it might have made life easier for some of Enron’s employees (and incidentally, I agree with him that this is an area that needs reforming).
#2 is unrelated to deregulation, and Greider doesn’t really provide a solution. Directors, both inside and outside, are elected by the shareholders. Management of widely-held companies have a tremendous amount of influence over who will sit on the Board, largely because they put together the proxy statements that are sent out for each election. Is Greider suggesting some kind of regulatory scheme should be in place for this? Does he want the government to be choosing outside directors?
#3 is actually related to the problem at hand, and conceivably could have an impact on preventing. You’ll note that I dealt with his proposal extensively in earlier posts.
Greider’s article also raises other points, like the repeal of Glass-Steagal, allowing banks to move into traditionally non-banking financial areas.
Look, I think my problem with your approach is that I see these deregulation (or non-regulation) schemes as each being so fundamentally different as to defy being lumped into one category for all but the most superficial of reasons. Energy deregulation is not regulation of accounting is not regulation of corporate governance is not regulatory divisions between banks and other financial institutions. The issues at stake in each one are just so different that to try to lump them together into one category to manufacture a “trend” is just nonsensical.
I couldn’t disagree strongly enough with your sentiment that “investigation into Enron, and the political aftermath can, and arguably should, take the form of a referendum on what kind of society people want.” The investigation into Enron should focus (unsurprisingly) on what actually went wrong at Enron, and the political aftermath should be tightly focused on finding solutions to those specific problems. To do otherwise – to make the Enron debacle into some kind of grand “referendum on what kind of society people want” – would only serve as a distraction to the important work ahead.
(Imagine a brilliant segue here)
Since you noted it, here’s a quick primer on “mark-to-market” accounting since you noted it in your previous post:
That’s from a Texas Society of CPAs article written by the guy who taught me auditing as an undergraduate at Baylor University many moons ago, Bill Thomas. Unfortunately, the full article is limited to TSCPA members (my wife keeps up her membership even though we’re in New York), and board rules keep me from posting the whole thing.
To pick up the rest of your post:
For starters, I don’t see Pitt as being quite so terrible. Yes, he worked as an attorney defending accounting firms, but that’s no guarantee of bias. I’ll reserve judgment until we see what the SEC proposes regarding Enron-like accounting issues.
Also, the SEC is one of the most apolitical agencies in Washington (and most informed observers will tell you it is one of the most competent agencies as well). While the people at the top are important for initiatives to change the rules governing disclosure, once a rule is in place I doubt very seriously that there will be any problem with enforcement. (Anyone who’s ever had to deal with SEC comment letters on their securities filings – as I have – will tell you they are real sticklers, sometimes annoyingly so).
The advantage of Enron-style trading is that it allows previously wasted capacity to be traded and used. Surely we can all agree that that is a good thing. Other innovative uses for derivatives involve hedging of risk. For example, I’ve worked on credit default swaps, where a company pays a fixed fee to a financial institution in exchange for the financial institution paying them when the company has a debtor default on payment. This is a powerful tool for a company to shift its risk to an entity that has more experience in dealing with that particular risk.
The uses of these instruments are limited only by the imagination of financial professionals. Of course, some of these instruments don’t work out as well as planned, but that’s OK – that’s the market in action. The failure of a financial product is no different than the failure of any other product.
Well, no one claimed that Enron-style innovations were some kind of cure-all for every economic ill. They won’t cure cancer, either. That doesn’t mean they aren’t worthwhile.
(Imagine another brilliant segue)
Finally, I just wanted to point out that I think your tut-tutting is startlingly inappropriate. I’ve been on these boards quite long enough to know what is expected, and I think my posting history demonstrates that fact amply. I think a perusal of my posts will show I readily admit when I’m wrong and that I am willing to modify my views given good arguments in favor of such. Just because I’m unpersuaded in this instance doesn’t mean my attitude is one of “win at all costs” or that I am arguing in bad faith.
Gee, I can’t imagine why we’d want to talk about commodities pricing and market regulation when discussing the failure of Enron. I mean, those subjects are are just so off-topic as to defy imagination. :rolleyes:**
Since when do “facts” equal “obfuscation”? And what exactly is “indefensible” about the view that the NEP and the Enron collapse are two distinct things that should be treated separately?
Actually, I just checked the TSCPA page and apparently they’ve decided to make the article I cited above free to the public. It’s one of the better articles on Enron I’ve read, so I highly recommend it. Here’s the link:
For those of you who arguing that environmental groups were “shut out” of the Bush energy plan, there is an interesting article in today’s Washington Times entitled Energy sought greens’ advice.
A relevant excerpt:
In fairness, the article indicates that some environmental groups felt they weren’t given adequate time to prepare recommendations. However, it seems odd to me that they didn’t have their recommendations ready to go – it was hardly a secret that the Bush administration was working on an energy policy, and these guys say they were beating down the door to get into those meetings. Sounds like poor preparation to me.
And from your own story, here’s an excerpt that’s actually relevant.
What part of consulted is unclear to you? I take it to mean that they talk to environmentalists before they write the report, not as they are finishing the final draft.
These “discussions” were nothing more than political cover, which you would know if you actually read the article you linked.
Odd, Tejota, that you missed the part of my post where I noted the objection that “they weren’t given adequate time to prepare recommendations,” which is basically the complaint made by the NRDC spokesman you cite.
And a month and half is considerably earlier than when they are “finishing the final draft” – good lord, I’ve been on complex securities transactions that have radically changed in that span of time.
The “only after outcry” and “hammered” stuff is typical political woof.
“Energy Department documents now confirm what everyone has long suspected — that in seeking guidance on its energy strategy last year, the Bush administration welcomed industry executives and lobbyists with open arms, while treating environmental groups like skunks at a picnic.”
and
“Thanks in part to the unbalanced Cheney report, the House produced an alarmingly one-sided bill with $27 billion in subsidies for traditional energy producers, and only $6 billion for conservation. In the Senate, a more promising bill has been weakened by industry pressure. That’s what happens when only one side of an issue gets a fair hearing in Washington.”
Here, btw, is an interesting article from The Nation calling for further investigation into Cheney’s Enron connections.
There’s lots of argument, but here’s some of the most straightforward analysis:
*"Under the Federal Advisory Committee Act of 1972, task forces like Cheney’s must conduct public meetings, must allow interested parties to attend and must keep publicly available records. But arguing “executive privilege,” Cheney, his aides and Cabinet departments have refused requests for records, despite legal challenges from the General Accounting Office and private groups. …
“With the notable exception of Waxman, the Enron-Cheney connection so far has received troublingly limited attention from Congressional Democrats. Senator Joseph Lieberman announced that a committee he heads would issue more than two dozen subpoenas that could cast light on Enron-White House contacts, but Lieberman’s determination to maintain a “bipartisan” approach has so far limited the scope of the inquiry. Democratic leaders moreover appear reluctant to invite charges that they are repaying the GOP for eight years of investigations of the Clinton Administration.”
“Neither the Justice Department nor Congress appear to be prepared to conduct the sort of investigation that is required to expose the full extent of the Bush Administration’s service to Enron. That investigation would have to be broad, since the connections with Enron are not limited to Cheney’s office. From Army Secretary Thomas White, a former Enron executive, to Trade Representative Robert Zoellick, formerly on Enron’s advisory council, Enron’s tentacles have reached throughout the Bush White House, shaping tax, trade, energy and environmental policy. All such connections are worthy of legal and Congressional scrutiny. But make no mistake, the place to begin is at Dick Cheney’s door. If there is any realistic hope of exposing the extent to which Enron’s machinations corrupted US policy at home and abroad, then the Office of the Vice President is not only a good place to start, it is the essential beginning point.”
FYI, here’s the AP article on the document release. Lots of “he said, she said.”
In any event, if I was an environmentalist, I’d still be upset with that lobby’s lack of preparedness. With an admittedly business-friendly White House, you’ve got to be ready to exploit every opportunity you’re given.
“In any event, if I was an environmentalist, I’d still be upset with that lobby’s lack of preparedness. With an admittedly business-friendly White House, you’ve got to be ready to exploit every opportunity you’re given.”
Lack of preparedness? From Dewey’s own link:
“Environmentalists said Wednesday they had requested a meeting with Energy Secretary Spencer Abraham in the months prior to release of the administration’s energy report but were rebuffed by an aide who cited Abraham’s busy schedule.”
and
“In March, Abraham held separate meetings with groups representing the nuclear industry, the oil industry and public utility industries to discuss the energy plan, according to documents released this week. He held no meetings on the plan with environmentalists or advocates for energy efficiency or renewable energy sources.”
“The environmentalists also asked to meet with Cheney, but that request too was denied.”
Well, Dew, if I were a right-wing spinmeister looking to fill a job opening, I’d be looking to hire you. With blatant evidence of how environmental and consumer groups were shut out in favor of big-time campaign contributors in the energy industry, you’ve got to be ready to exploit every opportunity you’re given.
Every opportunity to blow smoke and create confusion that is.
Congratulations to you and your excerpts from the Washington Times for creating even the momentary impression that this was anything but what it is.
Although more than 60% of Americans agree with the main platform of mainstream environmental groups, Dickie only finds time for the folks who paid big-time into his campaign coffers.
Mandy, dear, I may need to bolt my monitor down to keep it from spinning after that last post of yours.
The groups requested a meeting with Spence Abraham, Secretary of Energy. They sent a form letter that requested, accoreding to the AP article, that Abraham “set aside a short while (in mid-March) to discuss important energy and environmental concerns.” This begs a couple of questions:
If you want to influence the NEP, specifically, why don’t you mention the NEP by name in your letter? Why the broad, general request?
Why the Secretary of Energy? Christie Todd Whitman, head of EPA, is also a member of the NEP Development Group. Isn’t she the more appropriate liason for environmental matters?
They did get to meet with the Executive Director of the NEP Development Group, Andrew Lundquist.
Like I said before, if you’ve been screaming to have some say in the NEP, it’s shows a woeful lack of preparedness to not have your written materials ready to go when the call comes in.
Actually I believe that the Energy Department spokesperson called it “what appears to be a form letter”. So whether or not it *is * a form letter is still under discussion.
Not neccessarily. Given limited resources, if you’ve already been told that someone is too busy to meet with you, why go through the effort of drafting something which will never see the light of day? Furthermore, IMHO, it would very difficult to provide recommendations if you are unaware of what is being discussed. I note that the task force was considering whether or not, major renovations on old energy plants would require them to be compliance with the Clean Air Act-this was never published and it would be very difficult to make a recomendation if one is unaware that is being discussed.
Also from the Washington Post article, this quote is interesting:
I would submit that a meeting to ask questions or follow up with the material after review would be standard operating procedure to draft any policy. If this counted as environmentalist input, why should other companies be treated any differently?
Some articles also note that groups which promote energy efficiency or renewable energy policies did not have any top level meetings with the task force. Shouldn’t these groups have been consulted at the same levels as large oil, coal and nuclear companies?
This is so simple, Dewey. Free markets have no moral compass. If one can bilk and cheat investors legally, even for billions of dollars, it will be done.
Morally and now financially bankrupt corporations are trying to dictate morally bankrupt government policies that can possibly financially bankrupt the government as well. All the compassionate conservatism, pseudo- moderation, liberal dogma and procedural anomalies in the world cannot disguise that. Americans will no longer stand for it.
“The effect of the access afforded energy-industry officials is telling: Auto companies lobbied against minimum mileage standards, and the final task-force report adopted that position; power generators lobbied against requirements that they upgrade pollution control equipment when they refit existing plants, and the task-force report urged the Environmental Protection Agency to revisit that requirement. On and on it goes: The energy industry asked; the energy industry received. The environmental and conservation communities did not even get a chance to ask, and they got nothing. While the industry has legitimate reason to be involved in energy policy, it also has a self-interest that does not always square with the national interest. Its view needs to be supplemented by other views.”
This, on the matter of the papers finally turned over by the Energy Department, thanks to a lawsuit, from St. Louis Today:
*"Large chunks of the 11,000 documents were blanked out – redacted, as they say in Washington. This makes it nearly impossible to determine who said what to whom about what. U.S. District Judge Gladys Kessler, who ordered the documents released under the Freedom of Information Act, just got stiffed. She should demand that the Energy Department stop playing games with the public’s right to know. …
“Add Mr. Cheney and Mr. Abraham’s non-compliance to Mr. Bush’s refusal to allow Homeland Security Director Tom Ridge to testify before Congress. Add Mr. Bush’s decision to withhold White House documents from historians. Add the Justice Department’s stingy interpretation of the Freedom of Information Act. The sum total is an administration that opens the door to private interests and shuts it to public view.”*
*"What is a surprise is that the Bush administration, usually politically adept, is continuing to make itself look guilty of misconduct, when it is probably just guilty of bad energy policy.
By blacking out large portions of the documents, the White House is heightening the suspicion about what is already known to everyone – it thinks in unison with the energy industry.
If it wished to turn the nation’s energy policy over to the oil, gas, coal and nuclear folks, the White House should have realized that it needed to at least put on a better show of considering, before rejecting as soft-headed, the views of
environmentalists.
If it really thought that only traditional energy firms should be sitting at the policy table, it should have forthrightly said
so."*
As I’ve maintained all along: this is just moral hand-waving. A policy should be evaluated on its own merits, regardless of who proposes the policy. A policy is good or bad independent of whether Snidely Whiplash or Dudley Do-right proposed it.
To wit: if you think there are “morally bankrupt government policies” in play here, let’s discuss the policies themselves.
As for the rest: goodness, I’m surprised at the response to the articles posted. I thought interesting that environmental groups hadn’t been shut out quite so completely as they had been claiming early on, and that they may not have been properly prepared, given that the NEP was something they considered to be a priority. I’ll happily cede that they weren’t given anywhere near the same level of input as industry – I wasn’t trying to make a claim along those lines. Although I would be interested to hear if they tried to deal with EPA on this (which, again, would be the logical liason for them on the NEP).
