I've been reading
Conspiracy of Fools, Kurt Eichenwald's new book on Enron and its unraveling. It's a great read, as long-time NYT financial reporter and Pulitzer finalist Eichenwald is able to take what is essentially an accounting story and make it sing.
Overall, what strikes me is this: yes, avarice and greed (QED), but truly, the Enron people were for the most part incompetent dolts.
And right in the middle of the book, on page 407, this fascinating bit of "what might have been."
In Washington, Dick Cheney, the Vice President-elect, was on the phone with Ken Lay.
Months of uncertainty had followed the November presidential elections, with the Bush and Gore camapigns fighting it out in court over the razor-thin margins of victory in Florida. Now, with Bush declared the victor, the Administration was assembling its Cabinet.
A number of candidates had already been selected--including Don Evans, the campaign's national finance chairman and an old friend of Lay's, to serve as Commerce Secretary. Lay himself had interest in one particular job, which was why Cheney was on the phone to Houston this day.
"Ken," Cheney said, "I'm sure you know, we've been seriously considering you for Treasury Secretary."
Lay could already tell the news wasn't good.
"The President has decided that with he and Don Evans and I all from Texas, all from the energy business, things were getting a little top-heavy. Nominating a fourth person that was in the energy business and from Houston would probably create too many problems."
"Well, I certainly understand, Dick," Lay replied.
Lay wasn't all that disappointed, though. He didn't lust for Washington. He was happy staying Enron's chairman.
I don't recall this being much reported at the time or later when Enron collapsed 10 months later (a Google search doesn't show much).
It's interesting to think about what might have happened if Lay had become SecTreas:
- We'd have missed out on the apostasy of Paul O'Neill.
- When Enron did collapse, just a couple of months after 9/11, the stock market in general was hit hard. Imagine if it's former chair was in the government at the time.
A couple of other things jump out. First, that the (stated) reason for not picking Lay was that he was another Texas energy guy, not that he was a gibbering fool. Second, that Cheney acknowledges in the call that he, too, was a Texan, and not from Wyoming, as the Bush campaign had posited for Constitutional reasons.