When the Priests of Capitalism Sin

Patt Morrison

July 14, 2004

I was wondering how Grandma Millie has been doing. You remember her, the hapless California electricity customer, the one the potty-mouthed energy traders on those Enron tapes bragged about bleeping over on her energy bill? I can't even use dots or asterisks to substitute for what Trader Kevin and Trader Bob were saying, or that's all there would be — dots — between snarky references to stealing from poor old ladies and jamming Grandma Millie for 250 bucks a megawatt-hour.

This was three and four summers ago, when the hotshot megawatt traders were holding us prisoner in the heat and the dark and making jokes about our miseries. Think Abu Ghraib with a beach. When a wildfire took down a power transmission line, they chanted "Burn, baby, burn!" When blackouts surged through the West like tsunamis, and people got trapped in elevators, and assembly lines slammed to a halt, and milk curdled in coolers, Trader Kevin wished for an earthquake that would "let that thing float out to the Pacific."

Enron road kill — that was Grandma Millie. Just like the rest of us.

I was hoping Grandma Millie would be feeling cheerier these days, what with Kenny-Boy Lay doing the perp walk into a Houston courthouse after the life got sucked out of Enron, and with Pop Rigas and son — John and Timothy — all set to serve maybe 20 years in Club Fed for turning Adelphia, the cable TV company, into their own little mint. Not to mention the fact that California has shaken a little conscience money out of some energy companies, and Arnold Schwarzenegger has been trying to muscle major dough out of them.

But then FERC, the Federal Energy Regulatory Commission, has ordered California to refund $270 million to Enron and some other deadbeat outfits. Explain to Grandma Millie, please, what's up with that? A burglar sashays out the door with your TV and some federal flunky says you're supposed to run after him and yell, "Hey, you forgot to take the DVD player too"?

This is the same FERC that finally, belatedly, a year and a half after Enron declared bankruptcy, yanked Enron's license to play the energy game because of its "inappropriate trading schemes." (Who dreams up this mush-mouthed gabble? It sounds like Glen Campbell defending himself against a drunk-driving charge by saying he wasn't really all that drunk, he was just "over-served." The Power Rangers weren't really criminal conspirators gouging the West Coast — they were just overearning.)

California's state motto is "Eureka," meaning "I have found it." The bullying contempt of the energy traders got eurekaed this spring by about a dozen people laboring at a U-shaped table in a 600-square-foot "listening room" in Santa Cruz, which is how we met Grandma Millie and charmers like Kevin and Bob.

Santa Cruz energy economist Carl Pechman was handed 2,800 hours of encoded computerized recordings to unscramble. He hired an out-of-work Silicon Valley exec, a teacher and some UC Santa Cruz grads, and for three months they listened to the traders' braggadocio.

Pechman was brought in by a Washington state utility that had been skunked by Enron too. Its lawyer, Eric Christensen, who once worked at FERC, says of the traders' scheming, "I think we were surprised at the level of arrogance, the level of indifference to consumers, the greed and the extent to which they openly discussed fraud and larceny."

For Pechman, the economist, it was the "burn baby burn" line. "The one thing the utility industry shared was this notion of service and this concern about service to customers," he says, "and the behavior of traders was so antithetical to that."

Can I assure Grandma Millie that things are going to be any better now? That a CEO who kills thousands of jobs and billions in pensions and investments will serve more serious time than a car thief who thrashes a Toyota? That California's attorney general, Bill Lockyer, will get his wish and one of these days escort Ken Lay to a hard-time cell to serve his sentence with a "tattooed dude who says, 'Hi, my name is Spike, honey' "? Not likely to happen.

Grandma Millie took one on the nose. We all did. But who got sent to intensive care? Capitalism itself, stabbed in the back by its truest believers. Capitalism is its own small-r religion. It prospers on faith as well as profit. Every time a billion-dollar headliner like Enron or WorldCom or Adelphia shakes down the Grandma Millies who trust their products and buy their stocks, it slanders its own faith as surely as any Catholic priest caught diddling the choirboy.

The priest can call it "ministering," and the energy trader can call it "arbitrage," but it's still a bleeping sin.