Enron has had repercussions across the globe. In Dabhol India where the company's bullying tactics resulted in it being criticised by Human Rights Watch and Amnesty International, I imagine the odd bitter laugh was uttered. In the UK Lord Wakeham's role as a non executive director of Enron provoked a more gleeful response, if like me you derive pleasure from seeing ennobled Tory Party Grandees end up with egg on their face and crap on their ermine.
As Enron went belly up it became increasingly hard to find an American politician who didn't have any financial links with the same over valued power corporation that they were promising tough action on. It turned out that Enron had given money from the very highest politicians to the very lowest and lower than that to the President George Bush himself. The company contributed to so many politicians that those who hadn't received any had a general suspicion of unimportance hanging over them.
The Senate hearings into the affair were billed as Capitol Hill proving it had not been contaminated by Enron's money. So focused were the politicians in their ruthless pursuit of truth, and spurred on by a possible decline in political contributions, that they failed to notice the polite coughing in the wings by the Cayman Islands Government. On 8th of Feb 2002, two months after Enron's stock had become less popular than contemporary jazz solos and a month into the Senate hearings, the Cayman Islands Government issued a press release. Which stated that the Cayman Island Government would be happy to co-operate with the US in the Enron inquiry should the US request it. This might seem insignificant but at the time Enron had nearly 600 subsidiaries registered in the Cayman Islands and not one person from the entire US government had had the wisdom, time or power to request the disclosure of these companies details. For the sake of clarity and correctly expressed outrage let me repeat Enron had nearly 600 off shore companies and no politicians or investigators were bothered about this. If I was a US citizen seeking to be reassured of my governments probity and diligence I would at this stage be heading for the hills with a hundred weight of dried beef jerky, a hunting rifle, a Do It Yourself nuclear bunker and a lot Van Halen CD's.
It is entirely possible that there is little of importance in those 600 off shore subsidiaries, many of them don't even have a registered telephone number in the Cayman Islands. Which would suggest that they have no office and are merely paper files run out of the offices of a Cayman law firm. However, that is no excuse for inaction, the investigators should have looked long before the Cayman Islands went out of their way to be so helpful. Their press release even informed the US as to how they would go about investigating the 600 companies. "Any request in the Enron matter would be treated in accordance with Sections 30 and 43 of the Monetary Authority Law (2001 Revision), which provides for full co-operation with overseas regulators." You can't get much more polite than that, I bet they even cleaned the best china in readiness and got some posh biscuits in just in case someone from the US popped by. More importantly though David Marchant from Offshore Alert notes the subsidiaries importance when he said, "These entities, some of which allegedly were used for Enron's off-balance sheet activities, are at the heart of the investigation into the firm's collapse."
In the middle of this remains the White House's refusal to disclose documents that relate to meetings with Enron and Vice President Dick Cheney's energy task force, as well as 8 other government regulatory agencies. So now we have a situation where an off shore tax haven is being more transparent and accountable to the American people than the very man the American people approximately elected President. As Bush continues to bomb Afghanistan, destabilises international attempts to get weapons inspectors into Iraq and prepares to punish the Iraqi people for having the misfortune of being born under a dictator, it is worth remembering the type of democracy he is fighting for. The shit kind. Where the stench of corruption is permitted to gather by order of the White House. I just hope Blair carries some joss sticks with him next time he visits his bombing buddy.
No wonder there is a general belief that when politician's order an "inquiry", you can be pretty sure that enquiring will be the last thing the "inquiry " actually does. It was Lord Wakeham's role in Enron, or at least the publicity of his involvement that helped prompt the Minister for Trade and Industry Patricia Hewitt to announce an "inquiry" into Non Executive Directors. The inquiry will be led by Mr Derek Higgs and is unlikely to make us all rest in easy in our beds. Mr Higgs was appointed a non executive director of the Allied Irish Bank some eighteen months ago, the same Allied Irish Bank that employed trader, John Rusnak. Which is the same Mr Rusnak who managed to run up debts of £485 million and hide them from the Allied Irish Bank over a period of five years. Whatever the competencies or incompetence of Mr Higgs, his involvement in AIB is hardly going to generate a resounding cheer of confidence in yet another "inquiry" and New Labours willingness and ability to regulate business.
Also published in the New Statesman