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Power Failure

In His Documentary About Enron, Director Alex Gibney Chronicles Not Just The Collapse Of A Corporation But The Failings Of Human Nature

LOW TEMPERATURE: filmmaker Alex Gibney strove to avoid a shrill Fahrenheit 9/11-style shredding of greedy corporate types in his documentary Enron: The Smartest Guys in the Room.

Enron: The Smartest Guys In The Room

Director:Alex Gibney
Release Date:2005

Opens May 20 at the Charles Theatre

By Ian Grey | Posted 5/18/2005

When he first set out to make his new documentary Enron: The Smartest Guys in the Room, director Alex Gibney’s initial impulse was not to simply to trash those he saw as the perpetrators of one of the greatest corporate felony sprees in U.S. history, but to trash them with warranted spite. “I was like, ‘These fuckers. These rotten greedy fuckers,’” Gibney recalls almost wistfully from his Manhattan office. “It was very hard to resist the temptation to just utterly skewer these guys and sneer.”

But down that road lay territory already owned by Michael Moore, hardly the film province appropriate for the man responsible for 2002’s sober and reasoned The Crimes of Henry Kissinger. After Gibney sifted through Enron’s rubble—with Bethany McLean and Peter Elkind’s 2003 book The Smartest Guys in the Room: The Amazing Rise and Scandalous Fall of Enron as his initial source—he found a better, more unsettling angle.

He saw that, while the avaricious extremes of some Enron-ites were indeed inexcusable, the film he wanted to make would be “about everyone’s gut check. Like, when you really, really want that new house, and you really gotta pay back those loans, do you take money for something you know to be ethically wrong?”

Gibney—who, with his crisply pressed shirt, manicured receding hairline, rapid chat rate, and excellent taste in pop music, could himself be the stuff of Enron-style new-paradigm coolness—realized that merely cataloging the company’s alleged crimes wasn’t enough. It also became paramount, he says, “that we never saw them as monsters. Because if they’re monsters, then they’re utterly disconnected from our own experience.”

Before examining why Gibney believes Kenneth Lay and company shouldn’t be relegated to mankind’s monster club, a quick recap:

Powered by dot-com hubris and CEO Lay’s connections to the Bush administration, Enron hit its stride with the addition of Jeffrey Skilling, a brilliant egghead who reinvented himself as a Maxim-style new-economy shaman. Skilling’s big idea was “mark-to-market” trading, “to buy and sell energy like you buy and sell pork bellies,” Gibney says. Put more simply, posting projected profits as cash the day a deal is signed.

Citigroup, Bank of America, Merrill Lynch, and others doled out billions in loans to enable Enron to keep mark-to-marketing, while the company was squirreling away losses into “investments,” shell corporations, and other accounting sleights-of-hand. Hundreds of millions flowed in and out of Enron in a frenzy of book-cooking, market-rigging, and a mind-set summed up by Gibney this way: “So long as we try to pay attention to the letter of the law, we can utterly violate the spirit of it. If we think something’s sleazy—fine, we’ll do it anyway. Because the money’s just too fucking good.” The resulting culture of avarice reached its zenith after George W. Bush was elected and it permeates Gibney’s film.

In the documentary, you watch Enron traders cackle as they game California’s failing power grid, or hoot “burn, baby, burn!” in anticipation of profiteering from the state’s wildfires. Lay moans about being down to his “last $20 million,” while other company kingpins dump their soon-to-be-worthless stock as they advise their employees to buy more, all the while crafting increasingly fantastic accountings to keep their stock price up. When Enron imploded, tens of thousands of employees lost their jobs and about $1.2 billion of retirement savings. The company’s stock price dropped from a high of more than $90 to less than 70 cents, devastating shareholders worldwide.

The bulk of Enron is a deft collage of footage courtesy of “disgruntled Enron employees,” interviews with prime players, unnamed sources, and help from congressional investigations. But in order to make human, and even tragic, the sheer magnitude of the company’s fate, Gibney decided to open his film with a re-creation of Enron exec J. Clifford’s suicide. “You see him blow his brains out,” Gibney says. “You feel that loss of that person in a way you wouldn’t if you just flashed his death as a statistic.”

It works—especially with Billie Holiday singing “God Bless the Child” as melancholy accompaniment. But still, Gibney needed a way to locate the Element X in the human psyche that caused so many people to behave so terribly. His answer: footage from the Milgram experiment.

In the early 1960s, Yale psychologist Stanley Milgram conducted experiments wherein a subject assured of no personal repercussions was urged to electrically shock an unseen victim to varying degrees—including death. “Fifty percent of the people shocked their subjects to death,” Gibney says. “The Milgram experiment shows that—and this is juxtaposed with Enron traders taking down the grid in California—given the right circumstances, the right culture, people can do horrible things. And so long as we believe that the market is a force of nature that will result in the best possible outcome, then we’re going to have problems like this.”

Lay and Skilling go to trial in 2006. But deregulation and free-market zealotry are still the rage, adding currency to what Gibney says is the real point of his film: to marvel at “the ability of human beings to delude themselves. That’s the most striking thing about the Enron story. Not that it collapsed, but how long it fooled people and how willing people were to be fooled.”

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