A Note From Our Editor: Beliefs Have Consequences—In Spades! -- By: John Warwick Montgomery

Journal: Global Journal of Classical Theology
Volume: GJCT 08:2 (Sep 2010)
Article: A Note From Our Editor: Beliefs Have Consequences—In Spades!
Author: John Warwick Montgomery


A Note From Our Editor:
Beliefs Have Consequences—In Spades!

John Warwick Montgomery

One of the very hottest shows in years is now playing at the Noël Coward Theatre in London’s West End. An indication of its popularity is the impossibility of getting tickets at my favourite location, the Half-Price Ticket Booth in Leicester Square. (People with Scottish chromosomes, such as I, are its best customers.)

Brilliant playwright Lucy Prebble’s production is titled simply, “ENRON.” By a combination of words, music, and lighting effects, it charts the rise and fall of that energy giant, which prior to its spectacular collapse on 2 December 2001, was America’s seventh largest corporation.

The theoretician of ENRON’s chimerical success was one Jeffrey Skilling, who would receive a 24-year prison sentence on multiple counts of fraud and conspiracy—but who remained defiant to the end, in spite of having effectively ruined the lives of more than twenty-thousand staff through the loss of $1.2 billion in pensions and investments.

What was Skilling’s business philosophy? It had a number of elements, most of which were allied to a thoroughly rightist political and economic philosophy (both George Bush and George W. Bush were great supporters, sad to say). First, Skilling was against government intervention in the economic sphere—so as leave the field entirely open to his own brand of uncontrolled investment. ENRON was successful in getting the federal government to allow the deregulation of electricity; when California deregulated, ENRON caused appalling electrical power shortages in the State, thereby effectively blackmailing California into electric bills which rose by as much as 400 per cent. (Doctrinaire conservative readers may well want to ponder this.)

Secondly, Skilling shifted the focus from tangible assets (pipe and cable) to the brokerage of energy through the creation of a stock market for electricity and natural gas. This destabilization was accompanied by the realization of immediate profits on future activity—which created a smoke and mirrors operation. When debits rose, Skilling’s CEO (who would later confess all and receive a considerably lighter sentence) came up with the idea of creating “special purpose entities” (in effect, sub-companies) for hiding ENRON’s debt under the guise of assets.

In the play, Skilling justifies all this on Darwinian principle, specifically citing atheist Richard Dawkins’ notion of the “selfish gene.” He also argues that since the value of a company’s stock is really based on the faith of the investment community in its intangible worth, this is comparable to religious faith—belief in the unseen.

One can of course draw lower-level lessons from ENRON’s collapse and t...

You must have a subscription and be logged in to read the entire article.
Click here to subscribe
visitor : : uid: ()