Conspiracy of Fools by Kurt Eichenwald (Broadway/Random House), 742 pages, $37 cloth. Rating: NNN Rating: NNN
New York times business reporter Kurt Eichenwald likes to write big books about big business in big trouble. So Enron gave him a perfect subject.
His massive Conspiracy Of Fools deconstructs the implosion of the once mighty energy brokering company under the weight of stupidity, greed and criminality.
Nobody can paint a more gripping portrait of the failures of the great and powerful than Eichenwald. Unfortunately, the Enron story is so sprawling and complicated that it doesn't lend itself to great storytelling. The schemes that eventually brought down the company were designed to be so dense that anyone on the outside wouldn't be able to figure them out. Too bad that includes the reader.
At the heart of the scandal was Enron's morally bankrupt chief financial officer, Andy Fastow, who, while pocketing nearly $60 million, kicked out the company's foundations.
Eichenwald says the naive trust placed in Fastow by CEO Ken Lay and his weak-kneed president, Jeff Skilling, led to Enron's fall. As the title of the book suggests, the author sees those resposible for the debacle as more stupid than crooked.
But this analysis is hard to accept. Some people in the company were aware of Fastow's crimes, however complicated. It seems more likely that Lay and Skilling were happy to let the scheming and frauds continue as long as the company showed a profit, even if that profit was illusory. Accounting sleights of hand that turned losses into profits made everyone feel swell about the job Enron was doing - whatever that job was.
The book takes off in the last half, when the schemes started to collapse because of their own complexity. How the players tried to cope as the company failed makes gripping reading. Eichenwald's use of short vignettes keeps the story careening breathlessly toward disaster.
Like Enron, this book is big and unsteady. It works terrifically as a psychological profile of people in crisis, but falters as an economics lesson.
Write Books at firstname.lastname@example.org