« The Supreme Court and the Klan | Main | Does the Filibuster Protect Progressive Laws? »

April 11, 2005

Corporate Crime as Personal Tragedy

I just saw an advance screening of Enron: The Smartest Guys in the Room, a smartly directed and entertaining film that actually manages to explain what the Enron guys were doing with their financial manipulations-- no small feat with a firm that's whole financial success was confusing analysts.

But while it's a skillfully made film, it's ultimately a cowardly one, both morally and intellectually.

But first the good stuff. With skillful editing and great music (I really liked the funny music leadins to segments), the film laid out the Enron crimes -- from explaining the well-publicized financial manipulations, documenting the fraud against retirees, and showing the actual murders perpetuated by energy traders who, by shutting down power on the West Coast, caused deadly pileups on streets now without traffic lights. If you want to understand what went on, this is the place to go.

The moral problem with the film is that the writers and directors have evil in their crosshairs but mistakenly think, as they explain in their press kit, that they have a "greek tragedy." Greek tragedies are about basically decent people done in by a fatal character flaw.

But the Enron leaders were just greedy, bad people done in by their greed-- nothing really complicated and no tragedy. If so many other people didn't suffer from the Enron leaders' crimes, their journey towards jail would be a happy moral tale of just desserts.

Nauseatingly, the last sentences of the film refer to the Enron leaders as "victims" of their own self-delusions, as if every evil person on earth doesn't lie to themselves to explain away the immorality of their crimes. At one point, the story cites the Milgram Experiments, an old psychology study that showed people would do bad things when ordered to by those in authority, to explain why Enron energy traders would defraud the public of billions of dollars without thinking about the evil of their actions. This is the moral cowardice of the film-- the filmmakers see nice educated professionals and can't just admit that these are bad people.

On the other hand, the intellectual cowardice of the film is that having punted on moral judgement of the Enron leaders actions, they also punt on what Enron means for understanding the larger global economy. That a company run by greedy psychopaths was praised as one of the best companies in the world for most of the 1990s is an indictment not of a few bad apples but of a whole economic system.

At the simplest level, Enron makes a mockery of the idea that the marketplace is a better allocator of economic capital than government. Conservatives mock government mercilessly whenever a highway project goes a few hundred million over budget, but here you had a company wasting tens of billions of dollars on useless projects and pure financial waste, even as Wall Street applauded.

To be fair, the film shows much of this disaster happening and there is something to be said for showing, not telling. But by not bringing in commentators on the broader economy, the film refuses to take an intellectual stand on whether Enron was merely a few bad apples undermining a healthy economic system or merely a psychopathic mirror of a generally diseased capital market.

Muckrakers of old didn't just take out individual companies in their profiles; they had opinions about what those stories meant for understanding how to create a better functioning world. The film spends too much time psychoanalyzing the villians and not enough time proposing alternatives to letting "The Smartest Guys in the Room" run the economy for everyone else.

Posted by Nathan at April 11, 2005 11:20 PM