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Commentary > Wastler's Wanderings  
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Hello Enron, hello Jason
Greed in business is like Jason in the movies ... it never dies.
April 26, 2002: 2:30 PM EDT

The business world needs to get in touch with its inner Jason - yeah that's right, the guy from the "Friday the 13th" movies.

He's a big guy -- wears a hockey mask and chases people, ostensibly to chop them up with a knife or an ax or whatever. His death-machine persona makes him supernatural and, well, really scary.

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You know what else is scary? He never dies. He gets whacked several times a movie ... and still he comes back, like a demonic Energizer bunny. Even at the very end, when the hero says "nothing could survive that" you know, for sure, there'll be a sequel. Hey, the 10th one is debuting this weekend.

Sure, it's schlocky movie fiction, but like most fables there's a point: Evil never dies.

That's a lesson we could take to heart in the business world, especially as we watch the Enron-Andersen disintegration. Think about all the people -- investors and employees -- who have lost retirements and livelihoods and you realize how bad and atrocious the situation is. It's evil. Right now the debate is whether it was individual evil or corporate evil. Regardless of the ultimate verdict, it's evil.

But it isn't as if we haven't seen this kind of evil before. The Enron-Andersen fiasco is just the latest instance. But before that were junk bonds, Keating, Ponzi, and Credit Mobilier, to name but a few.

And after each instance, just like a bad movie, the government tries to make sure it "doesn't happen again," usually by making a lot of speeches and passing a few laws.

Just like the movies ... it never works.

Take the anti-Enron bill that just moved through the House of Representatives. It has two major provisions. The Securities and Exchange Commission will invent a new board (with no subpoena power) to oversee accounting. Great, more (ineffective) government. And accounting auditors will be prodded out of some aspects of the consulting business. Of course, the Big Five have pretty much done that voluntarily. Major items like forcing companies to periodically rotate auditors and making it easier to sue accountants were voted down.

 
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You want a real indication of how tough the legislation is? The CPA lobby group likes it and public interest groups hate it.

Well, it is an election year. This legislation, if ultimately passed, will allow congressional folk to claim they "did something." Meanwhile, those accountants who contribute to political campaigns won't be totally offended.

And, face it, people -- notably people with money -- like accountants.

"This accountant is so aggressive it's scary," a financial reporter confided to me during tax season. "That's why everyone wants to use him." Sure, for taxes everyone wants somebody to stick it to the IRS. Just like companies want accountants that help their image with investors. But it is easy to go too far. The trick is to figure out when "aggressive" gets too "scary."

 
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Think about how much better off characters in a "Friday the 13th" movie would be if they accepted Jason's existence from the get-go. Instead of wasting time debating whether or not the scream they heard was "just the wind" they could be busy preparing for battle or, more pragmatically, running away. Jason always gets a few because they refuse to recognize that he's around.

The investment community needs to be the same way. Sure, let's work on laws and rules to better protect us. But let's recognize that the problem -- no matter what happens -- will always return and to keep an eye out for it.

What was that!!??? The wind???  Top of page


Allen Wastler is Managing Editor of CNN/Money. To send him an e-mail, click here.






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