Corporate Scandals

"Hello, Mr. Krugman? If the System Is Corrupt, Aren't You?"

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"Enron proposed to rent four days of my time, and I was also expected to put work into presentations. The [$50,000] payment for that time and effort, on a per day basis, was if anything somewhat lower than the payment I was getting for other business presentations. I certainly wasn't getting something for nothing."

— Economist and New York Times columnist Paul Krugman

***

"Mr. Krugman? Your editor at The Times is on the line. Want to take it?"

"Sure, thanks, Peggy. Hello, Phil?"

"Paul, hi. Just checking in about tomorrow's column. You have a topic?"

"Not sure yet. I thought probably I'd do something on how the Enron scandal proves, yet again, that George W. Bush and his Texas cronies and all their shady friends in the boardrooms of corporate America are out to line their pockets by screwing all the hardworking little guys out of their pensions and livelihoods."

"Sounds good, Paul. Any other possibilities?"

"Maybe something on the Bush budget. How this latest round of tax cuts for the rich, the very rich, the super-rich, and the ultra-rich proves, yet again, that Bush and his Texas cronies and all their shady friends in the boardrooms of corporate America are out to line their pockets by screwing all the hardworking little guys out of their hard-won wages."

"That's good, really good. Anything else? Surprise me."

"Phil, I'm thinking about weighing in on unfettered global capitalism. How it proves, yet again, that Bush and his Davos cronies and all their shady friends in the boardrooms of multinational corporations are out to line their pockets by screwing all the hardworking little guys out of a chance to get ahead."

"I like it. That all?"

"You know, Phil, I thought maybe I should write something on Social Security. How Bush's new plan, in the 2003 budget, to dip into the Social Security surplus to finance his tax cuts proves, yet again, that Bush and his Texas cronies and all their shady friends in the boardrooms of corporate America are out to line their pockets by screwing all the hardworking little guys out of their pensions."

"That's great. They're all great. Go with your gut. You're the best friend the working man in this country has got."

"I know I am. Thanks… right… bye."

"Mr. Krugman? I've got a Felix Fondler for you. He says you met at the opening of Gallerie Niçoise the other night. You want it?"

"Fondler, Fondler. Oh, right. OK, put him through. Yes, this is Paul Krugman."

"Paul. Hey. I hope you remember me. Of course, I remember you! I love your columns. Just love 'em. Like I said the other night, it's not only that you're the most brilliant economist of your generation. Or that your writing—wow, I mean, how do you make the language sing like that? But on top of everything else, you're the best friend the working man in this country has got."

"I know I am. Listen, Mr…. Fondler?"

"Felix. Please."

"Felix. I have a column to write for tomorrow, so how can I help you?"

"Sure, of course. As I think I mentioned, I'm the chief operating officer of Avaris Corp. We hedge options, option futures, and derive derivatives. Mostly in mining and chemicals, but financial instruments also. We're huge. What with Enron bust, we're the seventh-biggest company in America, even though we have only 118 employees. We are lean. Innovative. You don't find competencies more core."

"Uh-huh. And?"

"Paul—may I call you Paul?—we need your advice. We're playing in a brave new world here, a bold new reality. We're innovating to keep pace with today's fast-changing world. We don't understand half of what we do, and our accountants don't understand the other half. We are redrawing the road map. We need people, smart people, to tell us about the future for two days a year and then let us drop their names all over town for the other 363 days. We need you to join our Senior Economic Roundtable."

"How's the workload?"

"Intense. One weekend a year. Two hours of actual business. Then eat, golf, get massaged, you know."

"Yeah, I know."

"Your job is to take our money, do next to nothing, and not be corrupted."

"How much is the retainer?"

"$40,000."

"Felix. Felix, Felix, Felix. Can I ask you a question, Felix? How much is the median family income in America?"

"Um, sorry, Paul, I don't know."

"It's a bit over $50,000, Felix. Can I ask you another question? Would you guess that being the best friend the working man has got is the sort of thing a person can do on a shoestring? Is that what you'd guess?"

"No, Paul, not at all—"

"Felix, taking corporations' money to do next to nothing and not be corrupted is not the sort of thing that just anyone can do, is it? It's the sort of thing that only a true friend of the working man can do, am I right?"

"I realize that, Paul, believe me."

"So you're asking me to do this for less than the average American family earns in a year? For less than Enron paid me? Which, by the way, was less than my going rate?"

"Well, it's just two days a year. Enron was four."

"Felix, I think maybe you'd better find yourself another economic visionary and tribune of the working man. Paying me to do next to nothing and not be corrupted is going to cost more than kitty litter."

"I understand, Paul. I'll see what I can do. Thanks… bye."

"Mr. Krugman? I have a reporter on the line. He says he's with the Washington Bugle."

"Oh, gee. I guess I'd better take it. Hello, this is Paul Krugman."

"Yes, Mr. Krugman? Hector Ferrit with the Bugle. I'm doing a piece on private money in American politics."

"OK, how can I help?"

"Well, about that $50,000 you agreed to take from Enron."

"Look, I've been over that a million times, OK? When I wrote about Enron, I disclosed that I was advising them, and I only actually collected $37,500 of the $50,000, and the $50,000 wasn't even up to my usual fee for doing next to nothing, so even if I were corruptible, which I'm not, they didn't pay me enough to corrupt me."

"I know, Mr. Krugman. But you're writing for a newspaper whose big theme is that money from corporations and other special interests corrupts American politics."

"Of course it does. Everyone knows that."

"And you're writing for a newspaper that insists that just disclosing the contributions isn't enough. The Times says the money itself is corrupting."

"So what's your question?"

"If disclosure is good enough for you, how come it's not good enough for politicians?"

"Because I'm not corrupt. I never changed what I wrote because of money. Money had no influence on me. Zero."

"So why would they pay you $50,000?"

"Ask them."

"Would you favor a limit on the amount that economists who write about business can take from companies? Say, $1,000 per year?"

"No, don't be silly. Remember, I'm the best friend the working man of America has got. I use my influence to counter the crony capitalism of George W. Bush and his rich pals."

"But you're rich."

"Read my columns, Mr. Ferrit. Do they seem like the work of someone who has been muzzled by corporate money or blinded to the world's inequities by his own princely income?"

"Are liberal Democrats who take millions from Enron and other corporate and special interests less corrupt than conservative Republicans who take millions from Enron and other corporate and special interests?"

"The _system_ is corrupt. Our side is the one that's trying to change it."

"So how about changing the system—say, with tough federal limits on corporate money going to influential writers?"

"This is going nowhere. I've got to go."

"OK, one more question. If Congress and the Supreme Court give The Times its way, there will be tight limits on the ability of companies and lobbies and citizens' groups to run ads that criticize politicians by name in the weeks before Election Day. But there will be no limits on the ability of The New York Times and other rich and powerful media corporations to criticize politicians in their newspapers. Nor will there be any limits on rich and powerful economists' ability to criticize politicians in their columns. Is that fair?"

"Goodbye, Mr. Ferrit. Peggy, am I late for my lunch?"

"You're fine, Mr. Krugman. Your limousine is already here."