For everyone out of work because of the shinanigans of Enron (and Worldcom et al), I say that Uncle Sam owes us jobs…or gross compensation! Many jobs were directly lost due to the ripple-effect of Enron, for one. While I do not mean that the corner hot dog vendor’s sales went down…I DO mean some of us our now living on the edge due to a direct lack of work, planning, and projects DIRECTLY due to Enron!
Where the heck was the SEC or GAO to audit their books? Have they been sleeping on the job? Are they still sleeping now? How come Enron’s top brass can take the money and run? When is Uncle Sam ever going to make the USA safe for democrasy, in the sense that laissez-faire economics does NOT mean robbing the coffers while no one’s looking? Look what they’ve single-handedly done to our nation’s economic state!
Blowing steam…may it only happpen to our politicians, for once! The Enron story may be old, but like Ground Zero, the steam is still rising from the economic crater these financial terrorists left us! God bless all the unemployed and their hungry families.
If someone breaks into your house, steals your money and then blows it all, the cops will arrest the guy, but you don’t get your money back. Sorry. You could say, “hey, the cops were supposed to prevent the guy from robbing me”. That’s what insurance is for.
You can try to sue Enron, it’s directors, or Auther Anderson (which no longer exists), but good luck.
And keep in mind that “Uncle Sam” isn’t some rich guy with a bunch of money available for the disaffected. He is actually you and me.d His money is our money.
Forgive my ignorance, but I don’t believe it is the SEC’s job to audit the books of public companies. Am I wrong on this? (And I know it’s not the GAO’s job. They audit the government’s books, budget, etc.)
I’m just wondering when we’ll finally see headlines about Ken Lay having his day in court. AFAIK, the guy’s not a fugitive or anything, so why hasn’t he been charged yet?
Public companies are required by law to file periodic statements to the SEC describing their finances and business in general. The big one is the annual report, the 10K; there are also quarterly reports (10Qs) that are the same thing on a quarterly basis.
These statements are audited by a reputable accounting firm (e.g., Arthur Andersen), who attests that, having reviewed the company’s books, the statement is an accurate summation of the company’s situation. Note that they don’t attest that the company is doing well, or has good management, or isn’t about to go in the toilet; only that the statement is accurate. This is where AA’s culpability for Enron comes in: while they were auditing the books for the statements, they were also consulting to Enron on the shenanigans that made the whole thing collapse. It’s like the art forger being called in as an art expert to authenticate his own forgery.
In theory, the SEC could audit every submitted statement, but in practice that’s impossible due to the volume. The statement’s accuracy is vouched for by the accounting firm, which is supposed to be enough, and they’re publicly available so that you, as a stockholder, can see them yourself and judge what’s going on. It’s the shareholder’s responsibility to be the company’s watchdog, since, presumably, they have a more direct interest in the health of these companies and that they’re being well-run.
One of the big scandals of Enron was the exposure of the fact that these accounting firms, which have auditing sides and consulting sides, weren’t keeping those two separated by a Chinese wall as they’re supposed to.
How would they provide such if they did owe you such? Would they be obligated to creat an Enron-like company solely for the benefit of putting you back to work?. And in a sense the govenrment does "provide’ you the jobs. Not in a socialist way, but through international trade restrictions, laws and regulations. Other than that, their providing would smack of the pinko state, and I am sure you are not advocating that.
The only the government owes you is justice because they have promised to provide such. And justice by their laws and regulations, not what you would consider fair necesarily.
I’d just like to nitpick one of hansel’s points (as the rest of them are correct):
To get an unqualified opinion, the firm must be an ongoing concern. If the auditor doesn’t believe the company has a future, an audit must say so.
Having said that, it is a very tricky business, as giving a bad opinion (which is anything other than unqualified) tends to really anger a client. There is an emphasis on spinning information to support a good opinion. Firms that don’t get good opinions either (a)work with the auditor to correct whatever is wrong or (b)start looking for a new auditor. I’d like to note that (b) can just as easily be instigated by the auditor. Sometimes, auditors will say that a client isn’t worth the risk. Probably not often enough, but it does happen.
To get back to the OP:
Several Enron executives have pleaded guilty and will do jail time. Maybe not the hard jail time or length you and many others feel they deserve, but they will do jail time.
Arthur Andersen is no more as a direct result of Enron. Their corporate culture let too many Enron’s (at least two) slip through - upper management did not tighten the reigns hard enough. An Enron-like client has lots of accounting partners looking at what happens, but revenues clouded judgments, IMO.
Also IMO, Ken Lay will go to jail. His trial will probably take much longer. The SEC and others will be years pouring over all of Enron’s documents - I wouldn’t be surprised if this takes 5-7 years to come to a close.
Uncle Sam makes the US safe for democracy by its laissez-faire policies, only it’s probably not as laissez-faire as you might wish to believe.
Stretching out your reasoning, any fraud committed by a public company (regulated by the SEC) is a liability of the government. Forgive me my greed, but I don’t want to pay taxes to insure that liability.
If Enron’s true financial condition were known, the company could not have hired many of those employees in the first place – there wasn’t enough productive work for them to do. Same for Worldcom – the big problem was that so many of the employees were engaged in work which turned out not to be productive – burying fiber that won’t be used for 10 years, servicing unprofitable accounts, designing and implementing poor billing systems, etc.
So the real question is, why aren’t the former employees being required to give back some of their salaries to compensate the lenders.
Jobs are being lost because of GATT, Nafta, etc, all forms of outsourcing to cheap foreigners. Our factories are closing and moving to mexico, india, china where labor is 58 cents an hour.
If you want american companies to build factories in the United States, if you want american companies to hire americans, then you must not encourage american companies to build their factories in china ,nor to lay off americans and replace them with indians.
America always had plenty of jobs in the past, and we had the highest standard of living, and the best economy in the old days because of our government, before NAFTA.
If you want american jobs back, then tell your politicians to return to the policies that made America the best country in the world.
For example:
"NATIONAL REPUBLICAN PLATFORM, ADOPTED AT MINNEAPOLIS, MINN., JUNE 9, 1892 We reaffirm the American doctrine of protection. We maintain that the prosperous condition of our country is largely due to the wise revenue legislation of the Republican Congress. We believe that all articles which cannot be produced in the United States, except for luxuries, should be admitted free of duty, and that upon all imports coming into the United States coming into competition with the products of American labor there should be levied duties equal to the difference between wages abroad and at home. "
It’s hard to fight economic forces. People like cheap products. The only way to offer cheap products is by lowering manufacturing costs. The biggest cost for a lot of products is labor.
Ah, yes, tariffs. There is an economic idea whose time has come. Let’s artificially raise prices - I’m particularly looking forward to double digit inflation again.
What is the percentage of instances in which a foreign move results in cheaper products for American consumers vs those which only serve to increase corporate profits and shaft American workers (excluding upper management – of course :D)?
IME, outsourcing doesn’t often result in cheaper product costs to the consumer. Prices are generally adjusted by what the market will bear.
This post is pure jingoistic BS but I am not going to waste my time arguing because Susanann has a history of drive-by posting and never returning to address anything. pure BS.
You say that as if corporate profits are a bad thing. IME, higher profits means fewer layoffs, greater expansion and eventually more jobs. There is also the aditional advantage of creating jobs overseas which will help create additional markets to sell to.
That does not mean that there isn’t legitimate concern over the departure of manufacturing jobs overseas. There is a question of whether or not America can survive as a service economy that produces nothing but bankers, lawyers, marketers and managers.
