Month: January 2002

“When people spend large sums trying to convince you of how wonderful they are, without then trying to sell you something, you ought to suspect that they are up to no good. And in the past, A.D.M. — one of the nation’s biggest political contributors — was up to quite a lot of no good: price-fixing, influence-buying, you name it.” – Paul “Enron” Krugman, New York Times, June 25, 2000.

The debate over whether to treat the al Qaeda terrorists and murderers at Camp X-Ray as prisoners of war seems to me a no-brainer. To be a prisoner of war requires that you observe the rules of war. A critical part of those rules is that you wear insignia clearly identifying you as a member of a particular army. Al Qaeda did no such thing. Another critical component is that you obey the laws of war. Among those rules, in Yale professor Ruth Wedgwood’s words, are also: “never deliberately attack civilians, and never seek disproportionate damage to civilians in pursuit of another objective.” Al Qaeda, of course, massacred thousands of civilians as a deliberate act. These terrorists are not soldiers. They are beneath such an honorific. They are not even criminals. In that respect, Dick Cheney’s and Donald Rumsfeld’s contempt for the whines of those complaining about poor treatment is fully justified. And vast majorities of Britons and Americans agree with them.

THE TIMES’ WEEKEND POLL: The only word for the way in which the New York Times constructed and presented its poll Sunday on Enron’s G.O.P. taint is propaganda. This wasn’t just liberal bias. It was a real slide downhill. To see the bias, you need to click on the actual poll results, not the Terry McAuliffe spin in the Times’ news columns. The headline for the piece is: “POLL FINDS ENRON’S TAINT CLINGS MORE TO G.O.P. THAN DEMOCRATS.” The basis for this assertion is the question: “From what you know so far, do you think the executives of the Enron corporation had closer ties to members of the Republican party or closer ties to members of the Democratic party?” The answer was that 45 percent said Republican, 10 percent said the Democrats, 10 percent said equal contacts and 34 percent didn’t know. Now think of asking the question about any corporation. Let’s say GM. Or Ford. Or Philip Morris. Or Pfizer. Don’t you think the answer would almost always skew to the Republicans? The question simply asked “members” of a party. How many execs of any corporation tend to be chummier with Republicans than Democrats? Notice that the question also has nothing to do with taint, unless mere ties imply guilt. In fact, the only real question about ‘taint’ is when the Times asks whether Enron contributions for a congressman would affect someone’s vote. A full 61 percent said it would make no difference. The Times further asked whether the Bush administration was lying about Enron. (No parallel question for the Democrats, like Joe Lieberman.) Anyway, only 9 percent said yes to that question (although more said hiding). I’m sorry, but this is a very thin reed on which to rest a Sunday headline about the public pinning the Enron scandal on Republicans. That’s what the Times wants you to think. It has nothing to do with the news – or their own poll – whatsoever.

THEN DASCHLE: My favorite little piece of Rick Berke spin is the following: “The poll also found that the Republicans’ drive to make a high-profile villain of the Senate majority leader, Tom Daschle of South Dakota, has not succeeded.” The evidence? Daschle has a negative favorability rating of – 4. A year ago, he had a net favorable rating of + 3. His only saving grace is that – amazingly – no one has ever heard of him. 18 percent don’t have an opinion, and 55 percent don’t know. So of the puny number of people who now know who Daschle is, all the newcomers have gone into the negative column. His unfavorability ratings have doubled in a year from 7 to 15! Now think for a minute what is in the mind of someone who literally thinks this data means the campaign to drive up Daschle’s unfavorability has “not succeeded.” And people wonder why the president took a copy of Bernie Goldberg’s “Bias” with him to Maine over the weekend.

NOW BUSH: One small addendum. The Time’s poll shows some remarkably good news for Bush. The Times’ spin is that he’s good on the war, useless on anything else. Hey, it worked for the dad, let’s try it on the son! But check out the actual poll. On the critical question of who’s trusted more to make the right decisions about the budget, Bush leads the Democrats by 40 percent to 33 percent. Five months ago, it was the reverse: Bush 35, Democrats 44. (This reversal on taxes also held for the parties). So it can be said that the New York Times’ drive to make a high-profile villain of George W. Bush in the matter of tax cuts and deficits has not succeeded. In fact, his war credibility has enhanced his domestic credibility. There’s linkage! By far the most revealing other detail is that the Times’ other campaign to depict Bush as a far-right president has also not succeeded. Six months ago, 24 percent described Bush as a moderate. That number has now gone to 41 percent. It’s one of the most dramatic and counter-intuitive shifts recorded in the poll. Guess what? The Times didn’t mention it.

THAT STARBUCKS ORDER: I got emails from hardcore Starbucks workers. I was going to discount them, but, hey, they’re not in the circles of Those Who Get Money Calls. Who else would know how to order a Double Tall Sugar Free Vanilla Non Fat Latte with extra whipped cream? My favorite email was the following:

“My husband, who always orders a regular coffee (decaf if it’s at night) recently shocked me by stepping up to the counter at Starbucks and ordering a triple grande decaf breve hazelnut no foam latte. When I questioned him about who he was and what he had done with my husband, he explained that he had been visiting Starbucks with his much more flamboyant brother and had been practicing ordering this drink just so that he could surprise me.”

You gotta watch out for those “flamboyant” brothers, don’t you? I had to decide whether to allow entrants to extend their orders with such additions as “soy” or (my favorite) “inch of room.” Then there was a phrase I heard once in the Astor Place Starbucks in New York City: “with Sweet ‘N Low already in it.” Here’s the winner: a Tall Triple Venti Sugar Free Decaffeinated Ristretto Vanilla Non-fat Extra-Hot Soy Double Cup Latte with Sweet’N Low already in it. Maybe one of you could try and order it somewhere and let us know what hell you unleashed.

TWO OUT OF THREE TNR OWNERS VOTED FOR BUSH: Can I have my column back now, please? (Just kidding, Peter). I’m proud to find out that the last time The New Republic made a profit was in 1993. Who was editor back then? All that buzz and a profit!

CRAMER CALLED IT: The Street.com’s Jim Cramer takes a lot of hits. So he deserves some credit for saying back last August when Enron’s Jeff Skilling quit, “If Enron isn’t disclosing what the reasons for the resignation are, we have to presume that it is something so horrendous and horrible that we can’t own the stock. I know I won’t touch it.” That quote is part of a chilling story of how financial and business journalism flubbed the Enron story in the L.A. Times. Check it out.

PUNDITGATE: I’m gonna lay off (unless I can’t help myself). My point was to stop the media brushing this under the carpet. I think it’s important all this stuff is aired, and I’m glad I did something to make that happen. Howie Kurtz does a decent job today, although he leaves unc
hallenged Paul Krugman’s outrageous assertion that criticizing his Enron-funding was a right-wing plot. I guess we’ll wait for the next millennium before the New York Times – 20 Enron stories a day – focuses on the pundit angle. I still think everyone with Enron lucre in the journalist trade should give it to charity to restore some semblance of integrity to the public trust. I also think the New York Times is going to have a hell of a time crusading against Bush/Enron in its news and edit pages when they have a big Enron beneficiary on their op-ed page twice a week. But I do think, in retrospect, I was a little harsh on Peggy Noonan. She wasn’t on the “advisory board”, like Krugman, Kristol and Kudlow. She was a speech-writer at the time. But I would say that the best interpretation for her is that she was had. She was schmoozed, taken around Enron, asked to write speeches, and put on a speech-writing retainer. But guess what? They barely used those speeches, or indeed anything she wrote. Her “work” ended up being as insubstantial as Krugman’s and Kristol’s. Noonan blames herself for not getting Enron. But there was nothing to get. It was a scam. And she was used like many others.

GAY EQUALITY COMES CLOSER: The British Tories decided last week to endorse the notion of state-benefits, rights and responsibilities for gay couples last week. The Tory spokesman, Oliver Letwin, one of the bright young hopes of the Tories, told the BBC: “Marriage is a tremendously useful and important thing for bringing up children. Those of us who are heterosexual have the choice to marry and Conservatives believe that people should exercise that choice if they want any of the rights and benefits. But homosexuals can’t marry. We don’t want to create a pale imitation of marriage, but we do recognise that there are real grievances.” It isn’t equality yet – but it’s a huge step forward. It follows on the heels of the Democratic Party’s recent decision to endorse same-sex benefits for social security. And the reason for these shifts isn’t hard to find. After more than a decade of intensive debate and conversation, more and more people see gay men and lesbians as human beings, not freaks. The annual College Freshmen Survey – a reliable and large sample of American students – released new results this morning. 58 percent of college students now support equal marriage rights for homosexuals. There’s an interesting gender gap on this, with a full 65 percent of college women backing equal marriage rights, with only 49 percent of the men supporting it. But these numbers have been moving upward inexorably since the survey measured them. There’s also an interesting Catholic-Protestant split. Catholic colleges have among the highest support rates for marriage rights – at 61 percent – compared to 44 percent among Protestant colleges. I hope the Bush administration sees these figures as good news for their policy of reaching out to gay and lesbian voters in the hopes of eventually making homosexuality a non-issue in the GOP and the country at large.

GOODWIN’S MESS: Doris Kearns Goodwin tries in Time to explain how another person’s verbatim passages came to be printed in her own book, without quotation marks. To tell you the truth, I buy it. I think that kind of confusion can easily happen if you’re not careful. Conflating your notes with other passages in a pile of documents and material can easily occur. I have only one question: I don’t see why Goodwin could not have put a simple footnote or note in the subsequent, corrected edition, explaining her original mistake and apologizing. Instead, she fixed it quietly, and hoped no-one would notice. We’re all human, I guess, and I’d vote not to get all huffy about this. Compared to corporate pay-offs to leading pundits, this is puny stuff.

PUNDITGATE IN BRITAIN: The Guardian just caught British Tory philosopher and columnist, Roger Scruton, on the payroll of tobacco companies. He was getting around $85,000 a year to write or get others to write pro-tobacco pieces in major papers. That’s even more than Bill Kristol’s Enron stipend. A leaked email from Scruton’s wife and business partner to Japan Tobacco said, “We would aim to place an article every two months in one or other of the WSJ [Wall Street Journal], the Times, the Telegraph, the Spectator, the Financial Times, the Economist, the Independent or the New Statesman. While one or more of these articles might be written by RS, we would do our best to get other journalists to join in.” It almost makes Paul Krugman look ethical. The Financial Times, by the way, just fired Scruton. Amazingly, the Wall Street Journal Europe is standing by him. “In contrast to the news pages, the editorial pages of the Wall Street Journal Europe provide a forum for the expression of a wide range of opinions directly from their authors,” WSJE said. “These pieces are clearly bylined with the author’s name and relevant details, to avoid confusion with pieces written by the Journal Europe’s editorial and news staff.” Denial, anyone?

DOWD VERSUS KRUGMAN: Interesting throwaway line in Maureen Dowd’s column Sunday. “Oh, the pull of Planet Enron,” she writes. “The atmosphere there was so rarefied that its inhabitants were blissfully oblivious to how privileged they were.” She couldn’t be referring to her super-rich Enron-funded fellow-columnist, Paul Krugman, could she? “It was a beautifully sheltered place (and not just in the Caymans sense),” she continues. “A place where inhabitants deluded themselves that their accomplishments and windfalls – Ivy League degrees, energy company sinecures, lucrative consulting contracts, advisory board booty – were the result of merit and hard work.” Hmmm. Those Ivy League degrees. That advisory board booty. I wonder what she could possibly be referring to? Keep at it, Maureen. Someone around there has got to tell him the truth. (That’s enough Punditgate – ed.)

PUNDITGATE READING: This story isn’t new, of course. Two excellent treatments of the issue can be found in the bookstore. One is Jim Fallows’ “Breaking The News,” and another is Howie Kurtz’s “Hot Air: All Talk, All The Time.” If memory serves, Jake Weisberg coined the phrase “buckraker” back in the 1980s when we both worked as junior staffers at The New Republic. The cheeky young interns back then affixed a little bell with Bob Novak’s face taped to it. We called it the buckraking bell, and every time some major pundit would head out of the office for another feed at the corporate trough, we’d ring it. Didn’t work, of course. But greed has a way of seeing its way past anything. (I said that’s enough! – ed.)

Kudos to OpinionJournal’s James Taranto for seeing through Paul Krugman’s flim-flam this morning. I hear that the eminent radio-show host, Diane Rehm, quizzed Bill Kristol this morning about his own Enron $100,000. Good for her and Kristol for getting this out in the open. By the way, I’ll be on CNN’s Reliable Sources tomorrow discussing this issue.

My boyfriend heard a 13-syllable Starbucks order today: “Double Tall Sugar Free Vanilla Non Fat Latte.” Can anyone beat that?

“You wrote, ‘Krugman and Noonan and Kristol cannot now be taken fully seriously whenever they write about Enron.’ What irritates me about these people–pundits, journalists, whores, whatever you want to call them–is not necessarily that they will not be trustworthy when writing about Enron specifically, but that I will begin to wonder whenever they or someone else starts extolling the virtues of other companies. I wonder if they realize it when they are writing in disgust about “bought and paid for” politicians who took a couple of thousand dollars for their million dollar campaign chest that we look at them and think the same thing, and that their words now become as meaningless to us as politicians’ do to them?”

Let’s say these Enron-funded pundits did nothing illegal or unethical. Let’s say they just took $50,000 minimum from this company for legit extra-curricular work. Maybe they didn’t know what a scam Enron was at the time. The point is at some point in the future any big corporation could be a scandal. And what does the pundit do then? He can disclose, sure, as Krugman and Noonan have. But that doesn’t get rid of the problem, unless they actually return the money. Isn’t there some cloud inherently over Krugman’s and Noonan’s subsequent writing about Enron? At least some of their readers now suspect something fishy went on. Haven’t these pundits essentially undermined themselves as independent watch-dogs of the culture? Isn’t the entire point of the press to be independent – observers of problems not part of them? Krugman and Noonan and Kristol cannot now be taken fully seriously whenever they write about Enron. John Ashcroft recused himself from any professional attorney-general dealings with a company he once got money from. Shouldn’t Krugman and Noonan and Kudlow and Stelzer and Kristol now recuse themselves from any further Enron commentary?

AND WHY IS NOONAN SO VAGUE?: Does she really not know how much she got from Enron? She gives a lee-way from $25,000 to $50,000. C’mon, Peggy. You should have a 1099 hanging around somewhere. You didn’t shred it, did you?

SOME LIKE IT HOT: Many people in the magazine business have their Tina stories. Here’s mine. At some point in the Tina era at the New Yorker, I got a call from Tina asking me to write a piece about “religion.” After routine flattery, she got to the point. “We have a fabulous issue coming up on religion and Dick Avedon is photographing several religious figures and icons and I wondered whether you could do an accompanying essay,” she asked in her clipped, breathless tone. “About what?” I asked. “Religion is a pretty big topic.” “Oh, that would be up to you,” Ms. Brown replied. “Anything that’s hot right now in religion. Anything hot.”… continued here.

Am I hallucinating? Peggy Noonan now joins the $50,000 Enron pundit club. At least she discloses the sum in her column (even if you have to do some math to figure it out). Why doesn’t she just say the total? Same reason as Krugman. It’s damning. Then she has the gall to write, with respect to the Enron scam, “How rich do you have to be?” I don’t know, Peggy. You tell me.

It finally happened. Paul Krugman finally realized he has a serious ethical problem on his hands. He won’t concede that, of course. Instead he keeps putting up smokescreens and diversions. The most preposterous is that Krugman – this millionaire pundit with the New York Times at his disposal – is a victim of the “Vast Right Wing Conspiracy.” Hmmm. Where have we heard that before? Is he aware that the paper that broke the news of his $50,000 Enron sinecure was, er, the New York Times, that bastion of conservative bias? Is he aware that this website – “too vile to read” in Krugman’s own words – also exposed conservative Bill Kristol’s $100,000 Enron lucre, conservative Larry Kudlow’s $50,000 and (see below) conservative Irwin Stelzer’s repeated non-disclosures of his own deep involvement. That’s three out of four pundits on the right. That’s some self-hating Vast Right Wing Conspiracy.

THE HAVES AND HAVE-NOTS:You’ll notice one detail missing from Krugman’s apologia – the amount of money he got. Why won’t he mention it? Because it’s the most damning evidence against him. I think the average New York Times reader would be shocked to hear that their economics columnist, whom they expect to be above conflicts of interest, is richer by $50,000 thanks to his ties to Enron and that he has bragged about it. Krugman also knows that. That’s why he won’t mention it. Then he even boasts that it was below his going rate! He then tells us in all seriousness that the criticism of his enmeshment of Enron is a function of the Right’s attempt “to discredit concerns about the gap between haves and have-nots.” Excuse me, Mr. Pundit “Who Gets Money Calls”, don’t you think you have a little credibility problem here? He says criticism of a super-rich pundit is a smokescreen to deflect attention from “a leftist morality play: wealthy executives make off with millions while ordinary workers lose their jobs and their life savings.” Puh-leaze. In fact, scrutiny of Krugman’s buckraking is precisely an attempt to expose the fact that Krugman himself is very much one of the “haves,” a specific example of the gap between haves and have-nots. He is the one absconding with $50,000 worth of dirty money from a criminal enterprise “while ordinary workers lose their jobs and their life savings.” Earth to Krugman: You’ve got a share of those life savings in your wallet. If you don’t have the decency to give your share back, then please have the decency to quit your sermons about others.

NOW, STELZER: As part of the right-wing attempt to nail Enron on liberals, I’ll now report on Enron’s connections with Irwin Stelzer, a prominent conservative writer, a contributor to the Weekly Standard and my own paper, The Sunday Times of London, as well as many other publications, including the Financial Times. Anyway, Mr Stelzer is, by all accounts, a key member of the Enron-financed pundit circle. He was key to encouraging Kristol, Krugman and Kudlow to join the Enron gravy train. He disclosed this fact himself in the Weekly Standard of November 27 2001. Alas, Stelzer wrote many articles about Enron before that date and, unlike Krugman, never disclosed a thing about his ties to Enron, let alone his financial remuneration. I base that on a Nexis search and a search through the archives of the Sunday Times. I emailed Stelzer to ask him if I had somehow missed such a disclosure, but Stelzer does not apparently believe in returning another journalist’s calls or emails – even from a fellow columnist on the same paper. I should add that I agree with much of what Stelzer writes and have no doubt that he is sincere in everything he has written. Nevertheless, disclosure in such a matter is a no-brainer.

THE PAPER TRAIL: Here are some extracts from Stelzer articles over the last few years that mention Enron. On October 11, 1998, in a column in the Sunday Times and the Financial Times, Stelzer wrote:

“Enron is putting money into solar and wind power, claiming that renewable energy can now produce electricity at prices that are almost competitive with coal, when coal’s environmental costs are counted. But those profits, if they are ever to be realised, are unlikely to come soon enough or be big enough to restore the industry’s lustre. The good news is that some companies appear to be well positioned to survive in a low-price, low-demand future … Add Enron to the list of those likely to thrive in the future. An aggressive company, Enron is an efficient operator of gas power plants that has led the way in energy trading and is in the process of adding about 1,000 professionals to its London staff.”

“Add Enron to the list of those likely to thrive in the future.” I don’t know whether he was being paid by Enron at that point in time or not. Either way, he made no disclosure. On December 2, 2001, as the scandal was breaking, he wrote a semi-defense of Enron in the Sunday Times:

“What Enron and Lay deserve to be remembered for is leading the fight for competition. This battle was waged in the halls of Congress, in state legislatures around the country, and in regulatory agencies at federal, state and local levels… [P]erhaps most important, Enron fought to allow customers and suppliers to strike whatever bargains they found mutually advantageous, rather than be required to buy and sell energy through the monopolies that control transmission facilities… [T]here is as yet no indication that the mistakes – among them expensive failures in new ventures and in some overseas projects – were other than honest ones, or that investors were deliberately kept in the dark or misled about the company’s finances.”

Again, there was no disclosure. (This is particularly odd, since the column seems to be an edited or re-worked version of his November 27 2001 piece for the Weekly Standard. The Standard piece included a disclosure. In the Sunday Times piece, in a paragraph of similar wording, it appears to have been removed.) On December 9, 2001, Stelzer revealed that Ken Lay was at one time on the short-list for Bush’s Treasury Secretary:

“Ken Lay, the chief of Enron, at the time one of the country’s success stories, was on the shortlist, but was disinclined to disrupt his cherished family life by moving to Washington, a decision he must now regret.”

Well, if Lay regrets the fact that he ruled himself out for Treasury Secretary, I’m sure Bush is extremely relieved. (If true, isn’t it a big story that Lay was on the short-list?) Again, Stelzer gave no indication of his ties to Enron in this column. On December 16, he mentioned Enron in a routine sentence, and again made no disclosure. Finally, on January 20, of this year, he wrote – again with no disclosure of his ties – that the fleeced Enron shareholders had it coming to them:

“The retreat from efforts to give individuals more say in their affairs, and to reduce government power, has, of course, been accelerated by the collapse of Enron. Many of that company’s 20,000 workers elected to invest their retirement funds in the company’s stock, even though they were offered several other investment plans. They gambled on becoming rich and lost their bets.”

It gives me no pleasure to record these instances. Perhaps there is an innocent explanation for them. I have no clue since Stelzer has not responded to any inquiries. Nor has he said how much money in total he received from Enron, but, given Stelzer’s role, it may well exceed Bill Kristol’s $100,000. So we appear to have a simple case of a journalist writing boosterish columns about Enron, being on a paid Enron advisory board, helping recruit other journalists to it, and only disclosin
g his ties in a single instance after years and several articles in which Enron was mentioned. This was the man who sat on the same board and was big buddies with Lay, Krugman, Kristol and Kudlow. It’s not getting any prettier, is it?

I apologize if you couldn’t get through to the site today, or if it was really slow. Our Internet service company told us this evening that we were subject to a “Denial of Service” attack. What that means is that someone somewhere over-loaded our server with multiple simultaneous requests, shutting down the system. I’m told this couldn’t happen by accident or heavy traffic. I consider it a compliment.

KRUGMAN’S OPINION: Several of you noticed that Paul Krugman’s initial response to the postings on this site about his Enron $50,000 sinecure was subsequently changed. He first said that this site was “too vile to read.” Then he amended it to say that it was “too mean-spirited to read.” I prefer “vile.”

MEDIA BIAS WATCH: “The implications of “Anarchy, State, and Utopia” are strongly libertarian and proved comforting to the right, which was grateful for what it embraced as philosophical justification.” – Christopher Lehman Haupt’s New York Times obituary for the great Robert Nozick (a mentor of mine). Justification for what? The implication here is that conservatives are just greedy, bad people and that Nozick gave them some patina of philosophical justification for their selfishness. How about the daring notion that Nozick gave the right new philosophical depth, nuance and style?

“[The pundits’] reluctance to discuss the matter was typical of the “buckraker” community, which has dug in its heels about suggestions that prominent journalists should disclose sources of their income from special interest groups, much as politicians are required to do. The basis of the argument for disclosure is not that a pundit’s power is identical to a politician’s. Rather, it is that both groups operate in the public eye, rely on public trust, and deeply affect public opinion and public life. Both therefore need to make extra efforts at disclosure because of the consequences when the public suspects the worst of them.” – James Fallows, “Breaking The News,” in a chapter called “The Gravy Train,” page 113.