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"Spreading
It Around" by Paul Krugman
[Originally published in the New York Times - January 25th, 2002]
A bizarre thing happened to me over the past week: Conservative newspapers and columnists made a concerted effort to portray me as a guilty party in the Enron scandal. Why? Because in 1999, before coming to The New York Times, I was briefly paid to serve on an Enron advisory board.
Never mind that, scrupulously following the Times conflict of interest rules, I resigned from that board as soon as I agreed to write for this newspaper -- making me much more fastidious than, say, William Kristol, who served on that same board while editing The Weekly Standard. Never mind that I disclosed that past connection a year ago, the first time I wrote about Enron in this column -- and also disclosed it the one time I mentioned Enron before, in a Fortune column. Never mind that the compensation I received per day was actually somewhat less than other companies were paying me at the time for speeches on world economic issues. And never mind that when I started writing in this column about issues of concern to Enron -- in particular, criticizing the role that market manipulation by energy companies played in the California power crisis -- my position was not at all what the company wanted to hear. (Compare this with the board member Lawrence Kudlow, a commentator for National Review and CNBC. He wrote vehemently in favor of the Cheney energy plan -- and has called this the "Clinton-Levitt recession," blaming Arthur Levitt, the former Securities and Exchange Commission chairman, who tried to fight the accounting laxity that made Enron possible.)
Yet reading those attacks, you would think that I was a major-league white-collar criminal.
It's tempting to take this vendetta as a personal compliment: Some people are so worried about the effect of my writing that they will try anything to get me off this page. But actually it was part of a broader effort by conservatives to sling Enron muck toward their left, hoping that some of it would stick.
A few days ago Tim Noah published a very funny piece in Slate about this effort, titled "Blaming liberalism for Enron." (Full disclosure: I used to write a column for Slate -- and Slate is owned by Microsoft. So I guess that makes me a Bill Gates crony. I even shook his hand once.) It describes the strategies conservative pundits have used to shift the blame for the Enron scandal onto the other side of the political spectrum.
Among the ploys: Enron was in favor of the Kyoto treaty, because it thought it could make money trading emission permits; see, environmentalism is the villain. Or how about this: Enron made money by exploiting the quirks of electricity markets that had been only partly deregulated; see, regulation is the villain.
And, of course -- you knew this was coming -- it's all a reflection of Clinton-era moral decline. Traditionally, as we all know, Texas businessmen and politicians were models of probity; they never cooked their books or engaged in mutual back-scratching.
One doubts that the people putting out this stuff really expect to convince anyone. But they do hope to muddy the waters. If they can get a little bit of Enron dirt on everyone -- the Clinton administration, environmentalists, liberal columnists -- the stain on people and ideas they support will be less noticeable.
Why is Enron a problem for conservatives? Even if the Bush administration turns out to be squeaky clean, which we'll never know unless it starts to be more forthcoming, the scandal threatens perceptions that the right has spent decades creating. After all that effort to discredit concerns about the gap between haves and have-nots as obsolete "class warfare," along comes a real-life story that reads like a leftist morality play: wealthy executives make off with millions while ordinary workers lose their jobs and their life savings. After all that effort to convince people that the private sector can police itself, the most admired company in America turns out to have been a giant Ponzi scheme -- and the most respected accounting firm turns out to have been an accomplice.
You might think that the shock of the Enron scandal -- and it is shocking, even to us hardened cynics -- would make some conservatives reconsider their beliefs. But the die-hards prefer to sling muck at liberals, hoping it will stick.
Sorry, guys; I'm clean. The muck stops here.
