Enron was one of the early members of the Global Climate Coalition, a group formed in 1989 by corporations concerned about the likelihood of global regulation of energy production by a United Nations bureaucracy. Such concerns emerged from growing global warming hysteria, which were fanned by then-Sen. Al Gore. But in the mid-’90s, Enron, along with Shell and British Petroleum, pulled out of the coalition and began plotting a new strategy.
Did Enron see the light, and decide that global regulation was required
to save the world from catastrophic global warming? Or did they see the
wisdom of owning and controlling the resources that would be required by
the world, when fossil fuel use was regulated and eventually banned?
In the early 1990s, Maurice Strong called his friend Stephen
Schmidtheiny, a Swiss industrialist, and together they created the World Business Council for Sustainable Development. Enron was an early participant. Strong was CEO of Canada’s
Hydro-Electric, a major electricity supplier that was a prime target for
acquisition by several large corporations – among which was Enron.
Kenneth Lay, Enron chairman, was tapped by the Clinton administration to
represent industry on The President’s Council on Sustainable Development
in 1993, along with Carol Browner, EPA administrator, and Timothy
Wirth, undersecretary for Global Affairs, and several other Cabinet
level officials. The purpose of the PCSD was to translate Agenda 21 recommendations
into public policy – recommendations that were adopted, along with the
U.N. Framework Convention on Climate Change, at the U.N.’s 1992 Earth
Summit in Rio de Janeiro, which was headed by Maurice Strong.
Timothy Wirth headed the U.S. delegation to the U.N. Climate Change
negotiations, and Eileen Claussen, his undersecretary, was the hands-on
negotiator. Just before the 1997 Kyoto conference, Wirth left the
government, to administer the $1 billion grant Ted Turner gave to the
United Nations. Claussen resigned shortly thereafter to head the Pew Center on Global Climate Change, in
which Enron was a member and strong supporter.
While Enron, and the various organizations it supported, sang the
politically correct songs of global gloom and doom, Enron was posturing itself to benefit from the regulations that would follow the implementation of the Kyoto
Protocol.
When George Bush announced that he would not seek a “multiple pollutant”
regulatory policy, which had been urged by Enron, and when George Bush
announced that he would withdraw from the Kyoto Protocol, Enron realized
that the $113,800 they had invested in the Bush campaign, was wasted.
Rep. Henry Waxman, D-Calif., is already hurling blame-grenades,
trying to smear the Bush administration with some imagined impropriety,
linked to Enron’s contributions. In light of Bush’s policy, the
contributions to Bush had no impact.
If blame has to be assigned, it should be focused on the
“Public/Private Partnerships” promoted by the Clinton administration.
Five days after giving the Democratic National Committee $100,000, Enron
executives were on a “trade junket” with then-Secretary of Commerce Ron
Brown. Enron netted more than $500 million in government assistance through
contracts with foreign governments. In 1998, the EPA awarded Enron its
“Climate Protection Award,” for “exemplary efforts and achievements in
protecting the global climate.” The award was a public pat on the back
for Enron’s position shift on climate policy.
Having attended almost all of the U.N. climate change meetings since
1996, I saw firsthand the pressure that was applied to major
corporations by the Clinton administration. To put it bluntly, the
Clinton administration told major corporations, such as Enron, that they
intended to regulate carbon emissions one way or the other, and that by
entering into a “partnership,” they would get special treatment and
special benefits. Corporations that chose not to participate were put
on notice that the feds could make their life miserable with
“multimedia” (simultaneous action by several agencies) inspections and
enforcement programs.
Seeing the writing on the wall, it is not surprising that Enron chose to
play ball with the Clinton administration while getting its ducks in a
row to profit from the anticipated regulatory policy.
Lost in the whole affair, is the question about the validity of the
proposed regulations in affecting global climate. When Strong’s Council
on Sustainable Development, and Claussen’s Pew-funded Center on Global
Climate assembled some of the world’s most powerful corporations, profit – not the environment – became the compelling force that drove climate
policy.
Enron is only the first to fall among several corporations that put
their faith in global regulatory policy to produce corporate profits.
Other companies may not have been as heavily invested as Enron, but
several of Claussen and Strong’s buddies are feeling pain.
And they should. Enron’s fall is a classic example of the danger of
allowing government to manage the market. As bad as Enron’s disaster is
for its employees and investors, it is not as bad as it might have been,
had Mr. Gore been elected, and the whole world forced – unnecessarily – to pay tribute to Enron in the form of government-forced alternative
energy.
Government should let the market decide when and how alternative energy
sources are to be developed. When corporations “partner” with
government to force the market to buy selected or approved products,
everyone suffers; consumers in the short run, and in the long run, like
Enron, government’s partners.
Network ‘news judgment’ depends on who benefits
Tim Graham