Posted 1:09 PM by Robert

A Sort of Conspiracy Now Happens

As noted in the prior post, two memos from Enron’s attorneys Stoel Rives and Brobeck have caused even some good commentators such as Matt Miller to formulate complex conspiracy theories. The Man Without Qualities strongly disagrees with such conspiracy theories, but does believe people with serious manipulative political agendas released the memos.

But "manipulative" does not mean "sinister." Everyone is free to attempt to manipulate the political marketplace and the "marketplace of ideas." In this case, I do believe it is likely the Bush Administration has engineered the release of the memos for partisan reasons, but reasons far less sinister than those advanced by Mr. Miller. The memos were probably released simply to make sure they were "yesterday's news" long before the upcoming November elections. As noted here, by Mr. Miller, by Arnold Kling and by others, the memos do not contain serious evidence against Enron. Even sad Paul Krugman implicitly and sullenly agrees through his omission of substantive quotes from the memos in his most recent hyperbolic rant against Enron and the Administration. What the memos DO contain is all those silly - but sound bite filling - names of the Enron strategic moves: "Death Star," "Fat Bay," "Ricochet," etc. Such material would be far more effective if released closer to Election Day. By releasing the memos now, the Administration all but guarantees that the overwhelming "eyes-glaze-over" character of the Enron mess will have swallowed these silly names, too. The political actors now rushing to announce hearings and investigations know perfectly well that those hearings and investigations will probably just bog down as inconceivably boring energy and arbitrage economists wield their graphs in the summer doldrums, eventually to conclude that the memos contain essentially nothing.

The Administration has an additional incentive: summer is almost here - and the Administration absolutely does not want, and cannot afford, another energy crisis this summer. A summer of cheap energy will entomb the politically radioactive waste from Enron's meltdown. So the stakes for the Administration in a quiet, cheap energy summer couldn't be bigger. The fuss the memos are creating serves that purpose well by reminding the energy companies that the Enron matter, while dormant and boring, is far from dead. And that they had better behave

Is that a cynical take? I'd call it ordinary strategic thinking. But if I worked in the Administration I wouldn't put an analysis of the strategy using silly-sinister names in any confidential memos.