Josh Marshall

Josh Marshall is editor and publisher of TalkingPointsMemo.com.

Articles by Josh

The word has been out for a while that Ari Fleischer is one of the more feckless and incapable press secretaries any White House has had in some time. And that's saying something, because to date Fleischer has really never had a challenging situation to deal with. So, say what you will about Dee Dee Myers' chaotic tenure as White House Press Secretary in the early Clinton years, but she had a lot on her plate.

Could Enron be the scandal that convinces the adults in the White House that the president needs to hire a pro to do his spinning for him?

Can Ari Fleischer tell the truth? Let's make this the first installment of the Ari Fleischer Ridiculous Misstatement Watch.

Here's an exchange from today from Fleischer's daily Enron beating ...

QUESTION: The question is, does he [President Bush] feel that he [Ken Lay] should have the sort of access that he's had? Or does he believe that there ought to be more campaign finance reform?

MR. FLEISCHER: The President thinks that access should be across the board. And that's why the Sierra Club, for example, as you know, met repeatedly with the energy task force.

Wow, Sierra Club met with the Energy Task Force. Who knew?

Actually, The Sierra Club never met with the Energy Task Force while it was task-forcing. It was only after the Task Force had released its report that the Vice President agreed to meet with Sierra Club representatives to hear their gripes. So basically after it was no longer a task force at all.

Is this a lie?

Okay, quick TPM quiz. Who's the most execrable Larry King Live guest who's made three appearances or more since September 11th?

Sarah Ferguson, Duchess of York?

John Walsh of America's Most Wanted?

Or Chas Grimaldi, the reformed serial-killer who now lectures around the country to audiences of adolescent sociopaths on how to reform their lives before it's too late?

Okay, I admit it. I made up Chas Grimaldi. But, you know, I couldn't come up with a third person who was equally loathsome. And someone you'd also expect to see on Larry King Live.

Here's an angle no one seems to have given much attention.

After President Bush's election, Ken Lay's name was tossed around as being in the running for a number of potential administration appointments, including Secretary of Energy (Gas Daily, January 5th, 2001) and the Ambassadorships to Great Britain (Times of London, Jan 29th, 2001, February 5th, 2001) and Mexico (Dallas Morning News, March 30, 2001). Obviously, it didn't happen.

Why? (As the Enron ad campaign might say.)

Perhaps it just didn't pan out. Maybe Lay decided he didn't want the job.

But could Lay have been vetted and come up wanting? Could the White House have done a background check and come across some uncomfortable findings? Could Lay have been gracious enough (in that heart-to-heart potential nominees have with high-level officials or presidential confidants) to let on that there might be trouble on the horizon?

Note to White House press corps: this one's on me.

PS. Special thanks to TPM reader WB for putting me on this trail.

No more on Krugman and Enron here in these pages -- barring some new facts or interesting tidbits. But allow me to briefly touch on one point. The criticism of choice now seems to be that Krugman's disclosure of being on an Enron advisory board was not enough, since it didn't make clear this was a paid position.

But this is foolish.

Who serves on any corporate board without pay? No one. These are paid positions, period. Salary. Consulting fees. 'Honoraria.' Whatever! Folks get money.

Do people do enough to earn the money? That's another matter.

Should the companies' fiduciaries keep a tighter check on the purse strings? Maybe.

But are they paid? Always.

Is pro-market capitalist TPM the only one who knows this? TPM-sponsored classes in corporate governance and culture?

I hesitate to weigh in on this. But I must say all this talk about Paul Krugman's alleged conflict of interest over Enron seems ... well, a touch over-wrought?

Is this really a problem? As nearly as I can tell, Krugman got paid $50,000 for serving on some advisory panel for Enron in 1999. For $50,000 he hung out for a couple days at some conference and talked economics. He was supposed to do it twice, but the other conference fell through, or some such thing. (By the way, Krugman has posted his own defense here.)

A few points. One, conflicts of interest usually get attention when it's dog bites man. That is to say, if Krugman were making excuses for Enron. Since he's not, what exactly is the problem?

Second, Andrew Sullivan seems to think that the mania for efficiencies which Krugman displayed in this Enron article in Fortune was somehow wildly out of character. The idea being that Krugman is a taxing-loving lefty economist and that this particular, more Smithian article shows he was on the take, etc.

Sullivan just must not follow centrist or liberal economics that closely. Perhaps a wise bit of inattention, but telling nonetheless.

When I worked at the American Prospect, certain economic journalists at the magazine were endlessly griping about Krugman as some sort of right-leaning or establishment economist. Actually, more than one, come to think of it. There was a even an issue cover I think, or at least some page art we had commissioned, showing Krugman as a crude pitchman or something. I always thought this sort of talk was a bit whacked. But well ... we don't have to get into my history there.

In any case, the relevant point is that the seeming oddity or strikingness of Krugman's views in that article only seems so if you haven't followed the field. And I think the common assumption would be that Krugman -- at least regarding popular economic questions -- has shifted a bit left on a broad front in the last couple years, though I'd probably chalk that up to the terrain shifting as much as anything.

If there's an embarrassment here, it's that Krugman participated in the common business of taking a pretty large sum of money from corporate bigwigs for a pretty small level of exertion. (Note to corporate bigwigs: this is a common business in which TPM is eager to become involved -- though he'll keep criticizing until the offers start coming in.) But I don't see the conflict, since he seemed pretty straightforward about disclosing it.

Hear that creaking sound? That's the conventional wisdom about the Bush administration being in the clear on Enron starting to shift.

The early questions about whether the Treasury or Commerce Secretaries did anything for Enron when they got desperate calls late last Fall really miss the point. Once it became clear that Enron had been losing money hand over fist and that the company was -- as Enron Exec Sherron Watkins had told Ken Lay -- "an elaborate accounting hoax," what exactly was it they could have done?

So long as the President didn't issue an executive order freezing trading in Enron stock or take some other unimaginable action, there was really nothing that could be done. Enron's goose was cooked.

The questions about what favors got done are going to be ones that did or didn't get done earlier.

And as Byron York correctly notes in this article in National Review Online, the White House's growing unwillingness to answer questions is beginning to worry administration supporters.

For my money, I think the allegations stemming from Ken Lay's apparent axing of the former head of the Federal Energy Regulatory Commission, Curtis Hebert, are the first ones I've heard that really could stick.

Hebert, a Republican, got cross-wise with Ken Lay during the California energy crisis. And Lay made it clear to him that if he didn't play ball he "could no longer support [Hebert] as chairman." Hebert didn't play ball and pretty soon after that he was gone.

Hebert goes to pretty great lengths not to draw a direct connection between Lay and his being pushed aside at FERC. But his argument, frankly, strains credibility.

In any case, decide for yourself. Here's a transcript from CNN from the 15th ...

MARCHINI: What did Ken Lay want from you?

HEBERT: Well, actually Ken Lay wanted me to mandate regional transmission organizations, which I had told him there was no legal basis for under the Federal Power Act, not to mention it was not in the best interest of America. As you remember, at this same time last year, we had high prices in California and in the West. We even had the lights going out from time to time.


HEBERT: It certainly was not the time to do something like that when, quite frankly, you're worried about Americans having the lights on and having lower prices and reasonable energy.

MARCHINI: You didn't agree with Mr. Lay. What was the fallout?

HEBERT: Well, I didn't agree with him. Then he informed me that quite frankly, he and his company, Enron, could no longer support me as chairman. So, you know, have it as you will, that was his wish. But, you know, so many people want to give Ken Lay such great weight. I never gave him the amount of weight I think some people did. He certainly tried to wield a big stick as did a lot of his executives in Washington and in states throughout America.

But Enron, I never really saw as someone who could give me expertise as to where we should be going energy in America. I thought they were always looking after the best interest of Enron and never, quite frankly, the best interest of the electrical industry.

MARCHINI: Do you feel that a lack of Ken Lay's support cost you your job as the head of the FERC?

HEBERT: I never had any reason to believe that the White House was influenced by Ken Lay. I know he has a lot of friends, certainly, in the administration. Because he is-throughout Texas and has done a lot of work there. But the reason I had left the FERC was because the administration brought in two appointees, quite frankly, that agreed with Mr. Lay on mandating the regional transmission organizes. And they disagreed with me. There was already one member at FERC that agreed with them. So, I no longer had the balance, if you will, of the FERC. What good was it to be chairman?

What good, indeed?

Ready for your TPM intelligence briefing? Excellent.

The news today is that Chinese intelligence found a couple dozen bugs on an American-manufactured airplane which was to serve as Chinese President Jiang Zemin's equivalent of Air Force One. Given where the plane was manufactured and refitted, the origin of the listening devices - which were apparently highly sophisticated - seemed rather obvious.

Jiang was furious at the findings, according to the Financial Times.

But this story isn't exactly what it appears.

Look closely at when the bugs were allegedly found: last Fall. So this isn't really news. The fact that Chinese officials went to the press is news. And the reason is fairly straightforward and self-explanatory. President Bush is making a major trip to China late next month. And much rides on it for both sides -- which we'll be saying more about soon.

This is an effort on the part of the Chinese to throw the US side off-balance in the lead-up to the summit. It's a Chinese attempt to get the upper hand on the US by making it seem that an apology is required or that Beijing is being generous by not demanding one. It's standard operating procedure from the PRC.

So are the bugs really American? Who knows? I'd certainly assume so. But this doesn't have anything to do with spying. It's pure international politics.

In life, Enron may not have produced much of value. But in death the company is turning out some extremely high quality comedic product. Maybe there's hope for the company yet.

Today Enron fired accounting firm Andersen. "We're very troubled about the destruction of the documents, and we're very concerned about the accounting advice we got," said Enron lawyer Bob Bennett.

But Bennett's just a hired gun.

The real choice material is coming from the big man himself, Ken Lay:

While we had been willing to give Andersen the benefit of the doubt until the completion of that investigation, we can't afford to wait any longer in light of recent events, including the reported destruction of documents by Andersen personnel and the disciplinary actions taken against several of Andersen's partners working in its Houston office ...
In other news, Bill Clinton is now suing former White House secretary Betty Currie for insufficient supervision of Monica Lewinsky.