While at Babson, the Enron scandal broke. It was a fascinating accounting case (if “fascinating” and “accounting” can be used in the same sentence).
Malcolm Gladwell (The Tipping Point and Blink) wrote an article back in January in the New Yorker that was interesting:
My semi-defense of Enron is now out, in this weeks’ New Yorker.
And here is the link to Jonathan Macey’s wonderful law review article on the Enron case, which was my inspiration for the piece.
I also have a minor challenge for aficionados of the Enron case.
Years ago, when I was at the Washington Post, one of my colleagues on the science desk—Bill Booth—called up a dozen or so Nobel Laureates in physics and asked them to explain, in plain language, the nature and significance of the Higgs Boson atomic particle. None of them could. This was at a time, mind you, when the physics community was arguing passionately for the construction of a multi-billion dollar particle accelerator to look for things like the Higgs Boson. So it wasn’t for lack of interest. They were gung-ho for nailing the Higgs Boson. They just couldn’t explain the Higgs Boson.
Can anyone explain—in plain language—what it is Jeff Skilling and Co. did wrong?
I’m not asking for an explanation for what they did wrong as businessmen. That’s plain. They did a mountain of stupid and arrogant things. Nor is this about what Skilling and company did that was unethical or in bad faith. There’s a mountain of evidence on that too. The question is strictly a legal one: according to the way the accounting rules were written at the time, what specific transgressions were Skilling guilty of that merited twenty-four years in prison? For the sake of argument, let’s stipulate that summaries must be three sentences or less.
When I was reporting the piece, I tried to get someone to answer this question. But everything ended up very Higgs Bosonian.
