-Caveat Lector-
ENRON VERSUS CONGRESS:
THE "MAKE BELIEVE" CHARADES
OF ETHICS
By: Daniel
Sargis
Americans love a good game. Whether it is tennis, golf or
monopoly, the citizens of this great nation are obsessed
with the thrill of gaming.
Just look at the revenues from the gambling Meccas of Las
Vegas, Atlantic City or the Indian casinos of Connecticut
and the proof is there
for all to see how much this country loves a good game.
Lately, so much depressing news has been in the face of
America�s citizenry that it can become downright
depressing. In the spirit of good
citizenship, I�m going to lighten things up and play a
little game of Charades. What the hell, everybody needs a
break from the seriousness of
the war on terrorism, the softening of the economy and
the collapse of Enron.
Charade #1
1. What Building Are You Really Looking At?
It sure as hell looks like the Enron Headquarters in
Houston but let�s make believe that it is really the:
Bingo, you guessed it correctly. It is the U.S. capital,
home of the United States Congress.
Charade #2
2. What serves the same deceptive function as the Enron partnerships?
Enron, as most know by now, formed limited partnerships that were apparently used,
among other things, to keep debt off company books.
Thus, the company could show great operating profits and artificially keep its stock
price high. This is one of the key claims of fraudulent
misrepresentation that the United States Congress is starting to investigate in
their uniquely pious posture.
If you haven�t guessed the correct answer yet, here is a hint from Don Luskin
�there is no such thing as "Social Security tax revenues" and there is no
such thing as a "Social Security
surplus" and there is no such thing as a "Social Security Trust Fund" and
there is no such thing as a
"Social Security Lock Box."
These are just accounting gimmicks. No, they aren�t even that real. They
are just words. No, they aren�t
even that real. They are just lies.
Truth: all revenues received by the federal government from whatever
source is simply interchangeable
income, to be spent by the government any old way it chooses.
Truth: there is no Social Security surplus, and never has been. The
present value of the system�s liabilities
is greater than its assets by trillions of dollars.
Truth: any money invested in Treasury bonds to pay future Social Security
benefits-whether in a "trust
fund" or a "lock box" or, as Johnny Carson used to say, in a mayonnaise
jar on Funk & Wagnall�s
porch-isn�t invested at all. It�s just an IOU from the same government
that claims it will use the proceeds
from that same IOU to pay benefits.
That�s right, you guessed correctly again�it may look like Enron�s debt hiding
partnerships but it is actually the IOU�s that Congress writes
every time it bilks the cash out of the Social Security Trust.
Charade #3
3. What Looks And Acts Like Arthur Anderson accounting?
From the New York Times:
But much of the early attention has focused on the performance of Enron's
accounting firm, Arthur Andersen,
whose primary function was to assure that the company was accurately and
completely disclosing its financial
results and condition.
At the back of Enron's last annual report were two statements from Arthur
Andersen. One attested to Arthur
Andersen's opinion that Enron's internal accounting system "was adequate
to provide reasonable assurance as to
the reliability of financial statements." The other stated its opinion
that Enron's financial reports "present fairly, in all
material respects, the financial condition" of the company and its
subsidiaries. The statements a version of which
appears in the annual reports of all healthy publicly traded companies
amounted to a Good Housekeeping Seal of
Approval for Enron's books.
And, the correct answer is�The General Accounting Office
The General Accounting Office is the investigative arm of Congress. GAO
exists to support the Congress
in meeting its Constitutional responsibilities and to help improve the
performance and accountability of
the federal government for the American people�GAO's activities are
designed to ensure the executive
branch's accountability to the Congress under the Constitution and the
government's accountability to the
American people. GAO is dedicated to good government through its
commitment to the core values of
accountability, integrity, and reliability.
Just in case this little point might have escaped you, the GAO serves the same
function to the American taxpayer that Anderson accounting
was supposed to serve to the Enron shareholder�certifying that a realistic truth was
being represented to the public by management. For
instance, is Congress acting responsibly in its administration of the Social
Security Trust? If not the GAO is charged, by law, to let the
American people know the truth.
Charade Question #4
4. Some Crooks Are About To Be Investigated For Fraud And They Look Like
The Enron Group. Who
Done It?
The easy answer would be those from Enron who misrepresented the company�s financial
condition�including Anderson accounting. But
that is way too obvious.
Bob Levy, in the National Review wins the grand prize by correctly answering the
final question:
For decades, administrations of both parties have been using the
trust-fund surplus to supplement general
revenues. That process will hasten the demise of Social Security. Yet most
people have been misled by
politicians and their allies into believing that funds taken from Social
Security are merely "borrowed."
After all, the politicians say, the trust fund has U.S. bonds, and that
proves the money will be repaid.
Nonsense!
As the months and years of controversy over Enron ramble along, the American
taxpayer should constantly be wondering about the
hypocrisy of a government that can so castigate its business community for a few
misrepresentations while the Government itself is running the
greatest Ponzi Scheme in the history of fraud.
At least Enron robbed Peter to pay Paul. The U.S. Government, including a truck full
of self-righteous Democrats, has, for decades, been
robbing the entire population with no intention of paying anybody.
Those who pee away the Social Security retirement benefits of successive generations
for the self-serving pork barrel politics of convenience
should vacation for the next twenty years in the caves of Afghanistan (technically
they would not be POW�s or entitled to treatment under the
Conventions of Geneva).
But don�t fret over small details because Don Luskin assures us that, "A public
company that reported its financials to shareholders the way
the federal government reports to citizens would find its CEO and CFO sharing a jail
cell. But when it comes to Social Security, you move
up into a whole new level of fraud."
Who cares anyways�this has just been a little game of Charades.
Mail this article to a friend(s) in two clicks!
Daniel Sargis is a free lance writer from Connecticut and is a regular columnist for
Ether Zone
Daniel Sargis can be reached at [EMAIL PROTECTED]
Published in the January 29, 2002 issue of Ether Zone.
Copyright � 1997 - 2002 Ether Zone.
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