The US Govt helped Chrysler, why did they refuse Enron ?

[Richard Cranium]

The bailout of Chrysler saved untold trickle-down job losses. It was accepted to help them out.

But to help the nations largest energy company stave off bankrupcy, NO they did nothing to help.

Now thousands of people have NO retirement that some have worked 30+ years to accumulate, no insurance, no hope.

http://finance.yahoo.com/q?s=ene&d=1y

Jan. 11 — The Treasury Department acknowledged today that Enron's president sought government help in receiving a credit extension while the staggering energy company was trying to avoid bankruptcy last fall.

The White House has acknowledged contacts between Enron's CEO and Cabinet members, disclosing that Lay contacted both Treasury Secretary Paul O'Neill and Commerce Secretary Don Evans last fall, as the firm was entering a very public downward spiral
leading to the biggest bankruptcy filing in U.S. history.

[caddmannq]

...why did they refuse Enron ?

Maybe Enron put forth an unconvincing case. They certainly did enough other things wrong to convince me that either they were inefectual, or that they wanted the company to fold.

I know they've been packing those Golden Parachutes for some time

The really scary thing to me is that corporations this huge and vital have no safety net, in terms of government oversight. They are practically governments in them selves, and as such, represent a huge force in the survival of the nation, both economically and politically.

Normally, I don't like the idea of governmental intervention in private affairs; but neither do I believe that such huge businesses could exist without governmental intervention/influence/promotion in the first place.

If you're going to feed a dog, but not train him, don't be surprised when you get bit by a very large dog.

[Knothead]

Dunno, Dr. Vette, but what piques THIS response is that all those retirement packages--pffft-- where'd they go? I mean, we must be talking millions--if not billions--of $$, that went bye-bye, too?

If I were an evil corporate b*****d and I found myself having mismanaged the corporation down to such a sorry state, I would DEFINITELY make a big show about appealing to Uncle Sugar for a bailout, then (covertly) stymie the whole thing, and let the Gov't take the rap...meanwhile, quietly gather up the other company executives who are just as much of b*****ds, and start arranging another incorporation to grab the company back, for peanuts...plus, no pesky promises to keep, vis-a-vis employee pensions...or debts,...

Ooops, but THAT didn't work either...seems the employees were getting Enron stock as a bonus all those years, and these poor people were counting on it for their retirement! Get this--they were FORBIDDEN to sell or transfer that stock, and they watched, helplessly, as it became worthless...meanwhile, the aforementioned Executives were free to dump theirs!!

So the SEC apparently caught 'em, and they are currently facing charges, I believe. (Source: NPR) I hope they roast over a slow fire on the 11o'clock news.

I sure feel for those workers, though...

[charmler]

Were they the largest energy company, or the largest power broker that happened to own a pipeline? I am not too sure what the answer is but I do know that I never heard of them until 5-6 years ago when some ads popped up during MNF and STDS9. How did they get so big so fast? I think the answer is too many people playing the market day to day. When a stock price is climbing as fast as Enron was it becomes a highly visible and desired stock. Not enough research into the company added to the California style energy de-regulation and the short but severe drought in the Pacific Northwest together with the skyrocketing value of energy contracts aided the meteoric rise in Enron stock desirability. The previous administrations lack of a domestic energy policy coupled with the exodus of power producers from California and the media exposure of Enron stock gains caused a sudden spike in the value of energy stocks as a whole. It seemed that every news story at the time contained reference to the energy crisis and the skyrocketing profits some companies were making. Everybody wanted in on the action. The Chrysler bailout was different in that a large American producer with thousands of employees was on the brink of failure. This came about because of the double-digit inflation, double-digit interest rates and double-digit unemployment at the end of the '70s and early'80s. Nobody was buying new cars because they cost too much to finance. I thought Enron bought power and resold it. Do they own any generating plants or gas wells?
I dislike the way the airlines were 'helped' as much as I would disagree with helping Enron. The employees should have been able to sell their stock unless they signed a document beforehand that attested to their knowledge of the clause that stated otherwise. As far as the company goes, let it fall it may bounce it may not. IMO, the government should not have given the cash-strapped airlines 1 penny. They should have bought billions of dollars of future airline tickets and then issued the government workers who travel by air a credit card to be used to order tickets. Pay now, fly later. If you want to help a business, buy the product that business sells. The same should apply to the airlines. They sell tickets; the government has employees that fly. Ramble, ramble. Sorry I may have drifted from the topic.

[capybara]

the airlines fly people around, chrysler builds cars
and trucks. What does ENRON produce?
fraud? accounting tricks? arbitrage?
the US has no clear interest in supporting
these activities

fraud? accounting tricks? arbitrage?

I think Capybara hit the nail on the head. From what I read in Business Week and other magazines, they brought in this financial wiz to do restructuring for this energy TRADING Company. Well that was certainly done- it was restructured to bankruptcy.

I do know for a fact that Enron resorted to questionable practices in the billion $ plant they set up in India. They paid millions of $s in bribes to politicians to sell the consumer power at high rates. They were exposed and the investigation continues. The Enron scandal was a big thing in the mid 1990s.

As the DooooooooooooooooooooooooG says,

"What goes around Comes around."

(Wonder what he means by that?)

[newbie~wan]

Compared to companies like Chrysler, its really no big deal that enron went down.
It sux really bad for those people that lost all their money. BTW, is there ANYTHING at all these people can do? Has anyone heard of any court cases? I mean, I not sure who they'd sue, but.......

A great deal of enron's employees and assets are being acquired by other energy corporations. I know that my company has hired tons of them and aquired assets in Europe.