Bill Kristol divulged his own Enron-sponsorship on C-SPAN’s Morning Journal on January 13. Good for Bill. Now the hard questions: How much did he get? Will he give the money back to a charity for fleeced Enron retirees? Or is he going to be ethically up-staged by Hillary Clinton?
KRUGMAN, AGAIN: The response to the news that Paul Krugman, public scourge of Enron, was once on their gravy train, is almost as interesting as the original story. First, Krugman himself. Here’s his apologia. Not only does Krugman have no regrets about this – he even boasts about it! Krugman claims his 1999 piece was not about Enron, but a love-letter to markets. Well you decide. It was indeed a weird (for Krugman) piece of ‘irrational exuberance’ about free markets, but its centerpiece was Enron:
“[Enron] is not, and does not try to be, vertically integrated: It buys and sells gas both at the wellhead and the destination, leases pipeline (and electrical-transmission) capacity both to and from other companies, buys and sells electricity, and in general acts more like a broker and market maker than a traditional corporation. It’s sort of like the difference between your father’s bank, which took money from its regular depositors and lent it out to its regular customers, and Goldman Sachs. Sure enough, the company’s pride and joy is a room filled with hundreds of casually dressed men and women staring at computer screens and barking into telephones, where cubic feet and megawatts are traded and packaged as if they were financial derivatives. (Instead of CNBC, though, the television screens on the floor show the Weather Channel.) The whole scene looks as if it had been constructed to illustrate the end of the corporation as we knew it.”
I’m sorry but this gushing paean to Enron is not just a love-letter to free markets. It’s a massive suck-up to a company he was taking $50,000 from at the time. I know, I know. He disclosed the board membership. I never said he didn’t. But the money matters. At least I think it matters to your average New York Times reader who’d be shocked, I think, to find a New York Times columnist who, before he joined the Times, was a $50,000 paid crony for a major corporation that was in the process of fleecing its shareholders – especially since he is now one of that company’s fiercest critics. Then Krugman goes into a swoon about how much he was worth in the international corporate advice industry: “I was a hot property, very much in demand as a speaker to business audiences: I was routinely offered as much as $50,000 to speak to investment banks and consulting firms.” That’s interesting. I wonder how many other companies Paul “Hot Property” Krugman has taken money from in the past that might be relevant for his current disquisitions. I think he owes his readers an account of all the corporate money he has taken in the five years before he went to the Times, if he has ever subsequently mentioned those companies in his Times columns. My further question he ignores. Since many public figures who were once, like Krugman, beneficiaries of Enron’s largess, have now given the money to charity, will Krugman do the same?
THE MEDIA RESPONSE: Another telling issue. Howie Kurtz does a simple, fair, modest story, reporting the relevant facts on both sides. He’s a pro. Romenesko buries the story, never links to my original reporting, hasn’t linked to the New York Times original story about the $50,000, hasn’t linked to the Washington Times story on the controversy, and hasn’t linked to Kurtz’s fair summary. Instead he links to James Taranto’s odd item saying that there’s no scandal, even though I never claimed this was Watergate and even though James seems to agree that it’s all a little dubious if not exactly unethical by the letter of the law. Romenesko also links to Krugman’s defense, while never linking to the charges against him. How’s a reader supposed to get a fair account? (Romenesko spent a good deal of last week, in contrast, trashing a conservative journalist’s privacy in a matter that has no bearing whatsoever on that writer’s journalistic ethics.) In the wagon-circling department, Josh Marshall writes the following amazing sentences: “If there’s an embarrassment here, it’s that Krugman participated in the common business of taking a pretty large sum of money from corporate bigwigs for a pretty small level of exertion. (Note to corporate bigwigs: this is a common business in which Talking Points Memo is eager to become involved — though he’ll keep criticizing until the offers start coming in.)” Am I hallucinating or is Marshall semi-jokingly saying that he is a columnist for hire? And people wonder why the general public is suspicious of the ethics of journalists?
SO AM I CRAZED?: I don’t think so. I have no ax to grind in this. If anything, since the New York Times Magazine regularly publishes me, I’m not exactly being self-interested in asking some hard questions of one of the Times’ op-ed stars. I haven’t claimed Krugman has committed a crime or even something deeply unethical. I don’t think journalists should be barred from sources of outside income if they disclose it when appropriate. I’ve given speeches for money at universities and once at a biotech conference, but I’m always careful to let people know of any specific conflicts when they arise. I’ve banged on about Krugmangate because I feared no one else would. It’s not ideological. My criticisms would apply to anyone of any politics on the take from Enron and not disclosing fully, including the fee. And there are surely double-standards here. I was hounded for declaring in advance that I was hoping to get some pharmaceutical advertising for this site. Krugman gets what many people would think of as a year’s salary by showing up for a weekend and gabbing about Asia – all to burnish the image of a company that is now a byword for corruption. And this year, after the scandal broke, he never mentioned this salient fact in any of his Enron columns. I still think that’s a story. We now need a real investigation, outlining the full roster of pundits, right and left, who have cashed Enron’s checks in the past. We need names and dollars. And we need to demand that they give the money back to the fleeced shareholders. If any of you have good information on pundits on the take from Enron, who haven’t disclosed, please let me know. Is the make-up of that advisory board public? I’d be grateful for any tips.
The Dish 