The Enron Hearings: Is Boring Better?

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Where in the world is Ken Lay? Congress wants to talk to the former Enron CEO, but he doesn't want to talk to Congress, and now even his lawyer can't find Lay. Attempting to force Lay to appear before Congress, the House Financial Services Committee contacted Lay's attorney, Earl Silbert, who said he couldn't accept a subpoena because he didn't know where Lay was. The Senate went ahead anyway, voting Tuesday to subpoena Lay to appear before the Commerce Committee.

Of course, the absence of celebrity guests may not be a bad thing. After all, you can lead Lay to committee, but you can't make him speak, and because nobody involved in the Enron mess seems ready to talk to Congress, representatives are moving away from trying to find out who to send to jail and toward discussing how to fix the real problems. The people dodging House microphones are a veritable Who's Who of the scandal: There's Lay, who resigned from Enron's board Monday night and decided not to show up before two Congressional committees Monday. Former CFO Andrew Fastow and aide Michael Kopper are expected to show up just long enough to take the Fifth. Arthur Andersen CEO Joseph Berardino is due today to talk about how much he didn't know. And so just as the cluster of Enron probes took a sharp turn over the weekend toward sending people "to the pokey," as Rep. Billy Tauzin put it Sunday, lawmakers are finding themselves either with no guests at all — the Senate Commerce committee simply canceled Monday's episode — or even worse: with guests that nobody particularly to watch.

Guests like SEC Chairman Harvey Pitt, who spent Monday afternoon before the House Financial Services Committee telling his questioners that the SEC was not only capable of getting to the bottom of the Enron mess but of also being a friendlier place for corporate accountants to come with questions about what they should and shouldn't do. And for all Pitt's genially droning delivery, and all the time he spent dodging grandstanders digging for pungent quotes on Bush's budget priorities, at least the general theme of the exchange was figuring out — and fixing — the real problem. As Rep. Brad Sherman, D-Calif., put it: "What shocked me was how close Enron came to being completely legal."

Meanwhile, Wall Street wasn't waiting around for lawmakers to make the new rules. Investors went ahead Monday with their own brand of accounting and disclosure reform — knee-jerk selling. Companies with dark accounting clouds (Tyco, Global Crossing, Enterasys Networks), questionable earnings details ( or simply lots of complicated ways of making money (GE) all took baths Monday as "Enronitis" fueled a 220-point selloff of the Dow and a 55-point drop in the NASDAQ.

Some say accounting worries are only playing to larger fears that stocks are generally overvalued, and the buying that followed last week's Enronitis outbreak makes one wonder how long Wall Street's suspicion will last. But if investors can keep it up long enough to make understandability of earnings reports as important as their profitability, they'll at least provide Congress with a road map of how re-regulation ought to proceed. (Not to mention that nothing motivates public officials like falling indexes.) And they might even do what beseiged free-marketeers fervently hope: fix the problem on their own.

Late Monday evening (too late for the news shows) Pitt's House questioners finally got someone to talk about the bad guys — William Powers, who released the weekend report that had Tauzin and co. dreaming of perp walks through the streets of Houston. But Powers — the dean of the University of Texas law school who comes off a bit like a cowboy David Boies — had little to say that he hadn't written already, which was more or less what the Wall Street Journal had been reporting all month.

And so unless other-former-CEO Jeffrey Skilling, who as of Monday was still due to not only show up for his date this week but "speak freely" (this according to his spokesman), falls down on his knees and admits everything, no one will be pokey-bound over Enron for quite some time. Truly informational hearings, with regulators standing in for villains, won't make very good television. But the longer lawmakers are forced to ask about preventing the next Enron instead of punishing the current one, the better chance the hearings have of producing the new laws, new rules and new trust that Wall Street — and the small investors everyone wants back in the equities game — really need.