Another Bloody Shirt For The Left

Frank Rich waves the Enron bloody shirt around in The New York Times with predictable talk about the greed of Wall Street investors. This column not only talks about the Enron scandal as the next Watergate, but also accuses American corporations of war profiteering. Rich states:

Last weekend marked the media’s self-congratulatory 30th anniversary of the Watergate break-in, and it would have spoiled the mood to suggest that all the energy expended on searching for ol’ Deep Throat might be better spent trying to crack the Watergate under way right now.

This time the cancer is not on the presidency but on the economy, where the malignancy is a flood of corporate transgressions whose scope and scale, in the words of The Wall Street Journal this week, "exceed anything the U.S. has witnessed since the years preceding the Great Depression." As the first Watergate undermined Americans’ faith in government for generations, so the replay threatens to do the same to American business.

Rich is guilty of the typical hyperbole of the left in the Enron affair. Last time I checked, people weren’t worried about corporate accounting scares, they were worried about terrorism, the Fourth of July, and price of gas. Enron is a non-issue for many Americans. Most Americans didn’t own Enron stock, and polls have said that the vast majority of Americans believe that the economy will recover by the end of the year. It seems that the only people worrying their heads off about Enron are Democratic partisans and the media. Yes, there’s reason to worry about accounting practices and underhanded deals in the corporate world, but that’s hardly a revelation to anyone.

The Justice Department is touting its victory over Andersen as a strike at Enron, much as it hyped the arrest of the bomb-less "dirty bomber" Jose Padilla as a major setback for Al Qaeda. "It’s like focusing on the guy who drove the getaway car," says Thomas Cullen, the head of general litigation at the international law firm Jones, Day. Now that Andersen has received a death sentence, its thousands of innocent employees included, it has lost any institutional incentive to help the government build its tardy case against the big enchiladas at Enron itself.

Wait, Frank Rich wants us to believe that American corporations are doing something evil and underhanded and deserve to be treated like criminals, but then sympathesizes with Arthur Andersen? Let’s remind ourselves that this is a company that cooked books for Enron and shredded documents, impeding the Enron investigation, and engaged in obstruction of justice. Granted, I’m not a supporter of government action against American enterprise, but Andersen got what it deserved.

Rich then goes on to list the usual connections between Enron and the Bush administration, assuming that just because someone was tangentally connected to Enron or Arthur Andersen that makes them dirty. (Unless they happen to be Democrats of course. Someone should remind Rich that it’s the legislative branch that makes law, and that many congressional Democrats are as closely involved with Enron or even more so than the Bush Administration.)

And of course, there’s the obligatory reference to Gordon Gekko from "Wall Street&quot, a reference that has descended into the very depths of hackneyed cliche by it’s constant use.

Terry McAuliffe, the Democratic chairman, calls Enron "a metaphor for the Bush administration" after making some $18 million on a $100,000 insider’s stake in the now-bankrupt Global Crossing.

Is this the same Terry McAuliffe and the DNC that complained about the Republicans trying to tarnish Bill Clinton’s reputation and engaging in cheap partisan politics? If anything, both parties need to learn that this kind of scandal-making commits the biggest sin in politics: not being effective. This kind of petty politics didn’t work for the Republicans against Clinton, and it’s certainly not going to gain anything for the Republicans.

What also distinguishes our current corporate scandals from those of the 1980’s is the backdrop. After Sept. 11, greed on this scale starts to look as obscene as wartime profiteering. Take the case of Mr. Kozlowski, who made $300 million over the last three years, will net a disproportionately large tax break from the Bush tax cut and is alleged to have ripped off still another $1 million in sales taxes. Under his guidance, Tyco, which is based in New Hampshire, connived a tax break of its own, to the tune of $450 million a year, by incorporating itself, quite legally, as a mail drop in Bermuda. If you believe the president’s declaration that an effective new department of homeland security will cost no additional taxpayers’ dollars, then don’t worry. But if you think that a big bill for the war may come due some day, guess who will have to pick up that $450 million per annum that Tyco might have contributed as its fair share.

Again, the Democratic strategy for 2002 becomes apparent; try to link patriotism to highter taxes. Unfortunately, this strategy too is dubious at best. All the Republicans need to do is prove that cutting unnecessary spending will produce better results than raising taxes. All they need to do is cut through the rhetoric and get the Democrats to go on the record as opposing tax cuts and they’ve already won the argument as far as voters are concerned.

Far from asking the nation’s discredited corporate leaders to do their bit in our war on terrorism, the administration wants to fight another war to enable the Kozlowskis and Lays to sacrifice even less than they already are. As for those firefighters who did make a sacrifice by embracing "some cause larger than his or her own profit" on Sept. 11, their families are no more likely to reap serious dough from a repeal of the "death tax" than they are to be protected from losing their pensions in a future Enron by Mr. Pitt’s "reforms."

Again, this kind of patriotic call to higher taxes is a poor strategy. The class warfare rhetoric of the Democrats appeals to the Democratic base, but no one else. Al Gore lost an election he should have won by taking that "people versus the powerful message" when he should have been cruising on the record of the Clinton Administration’s economic success. Now the Democrats are trying to play by that same tired playbook. Unfortunately, they’re pitching the wrong message at the wrong time. McAuliffe has constantly criticized the Republicans for trying to "politicize September 11", while at the same time, it appears that Frank Rich is doing exactly that.

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