18 of 19 people found the following review helpful

5 Priming the Enron Pump

By TundraVision on April 26, 2003

Penn Square was peanuts. Robert Bryce’s witty racountement of the rise and fall of Enron reminds this reader of Mark Singer’s equally entertaining tale of the itty-bitty shopping center bank in Oklahoma City that went bust and took the Western Oklahoma Oil Boom with it.

14 of 19 people found the following review helpful

Format: Hardcover

The Enron books are coming out now, perhaps as fast as stock options granted to key executives at Enron. I expect some of these books will contain mind numbing financial details attempting to explain in very technical terms JEDI, Chewco, roll-ups swaps and mark to market accounting. This is not that book. With Molly Ivins providing an introduction, Pipe Dreams is a primer on ego, greed and ambition reminiscent of James B. Stewart’s infamous summary of Michael Milken’s shenanigans in Den of Thieves.

While the players have changed the hubris has not. The tops of many corporations continue to be littered with individuals whose first mantra is What’s in it for me? With the 1990’s stock market providing an unlimited supply of investor cash, Bryce describes a new breed of Enron executives with their prestigious MBA’s in hand, who ultimately overlooked the simplest of economic realities, you can’t spend more than you make, at least not forever. The real story of Enron begins with the departure of Richard Kinder. Kinder, a stickler for detail and results, imposed a financial discipline on Enron which required every senior manager manage costs and results. At the time Enron is basically a pipeline company with a steady positive cash flow. Enron is a real money maker, but in the eyes of a certain Harvard Business School alum, Jeffrey Skilling, just a bit boring.

At its core this is ultimately a story about Jeffrey Skilling. Skilling, a McKinsey consultant with a Harvard Business School pedigree, is described in Bryce’s book as the Smartest son of. I ever knew. A guru of new economics where the deal is more important than cash flow, Skilling ultimately proved to be financially dumb as a box of hammers.

Bryce understandably cannot resist the temptation to inject more than a few editorial barbs into this work, perhaps because the actions of the players were so outrageous. In the end, this book will make you mad, no matter what your politics.

The book is written in an easy reading, chronological and conversational style. The 51 individual chapters are relatively short, focused on particular subjects and easy to follow. Unfortunately, while excellent, this book emphasizes only the main Enron management players; a disengaged and out of touch Ken Lay, a beguiling and ostentatious Rebecca Mark intent on making her deals regardless of the economics, an ambitious, too smart and financially undisciplined Jeffrey Skilling and a scheming Andy Fastow. For the most part the book ignores meaningful insights into the individual actions (or inactions) of the auditors and the Board of Directors which when the lawsuits and federal prosecution dust settle should provide additional fodder for a needed sequel.

Perhaps Bryce’s most intriguing anecdote is the story of an Enron employee with a graduate degree from the University of Oklahoma. From my perspective here in Dallas, if Oklahoma ain’t Texas it is mighty close. And when it comes to the energy bidness those folks in Massachusetts generally don’t know their bottom from a dry hole. However, because she had a degree from OU instead of that other school, she was ostracized and condemned to the lower levels of Enron management. Sadly she was probably a lot better manager than the Harvard box of hammers.

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