An Enron Tale of Strange Bedfellows

The fall of Enron sounds the death knell for one of the great rackets of the last decade: the "Green Guys" seal of approval, whereby some outfit such as the Natural Resources Defense Council or the Environmental Defense Fund would issue testimonials to the enviro-conscience and selfless devotion to the public weal of corporations such as Enron. This approbation was part and parcel of the neoliberal pitch that fuddy-duddy regulation should yield to modern, "market-oriented" inducements to environmental good behavior, and the NRDC and EDF were the prime salespeople.

The NRDC's deep involvement with the Enron lobby machine is a case in point. Here's what happened: In 1997, high-flying Enron was in a pitched battle in Oregon, where it planned to acquire Portland General Electric, the state's largest public utility. Warning that Enron's motives were of a highly predatory nature, the Public Utilities Commission staff opposed the merger. They warned that an Enron takeover would mean less protection for the environment, increased insecurity for Portland General's workers and, likely, soaring prices. There also was the issue of decommissioning Portland General's Trojan nuclear plant.

Other critics argued that Enron's actual plan was to cannibalize Portland General, in particular its hydropower, which Enron would sell in California's energy market.

But as such protests threatened to deprive Enron of its prize, into town rode the NRDC's top energy commissar, Ralph Cavanagh, flaunting his ties to the Energy Foundation, a San Francisco-based outfit providing the financial wattage for many citizen and environmental groups. Cavanagh lost no time in whipping the refractory greens of Oregon into line. In concert with Enron, he put together a memo of understanding that pledged that the company would lend financial support to some of these groups' pet projects. But he had arduous politicking ahead. Approval for the merger had to come from the PUC, whose staff was opposed. So, on Feb. 14, 1997, Cavanagh showed up at a hearing in Salem, Ore., to plead Enron's case.

Addressing the PUC, he averred that this was "the first time I've ever spoken in support of a utility merger." If so, it was one of the quickest transitions from virginity to seasoned performance in the history of intellectual prostitution. Cavanagh touted the delights of an embrace with Enron: "What we've put before you with this company is ... a robust assortment of public benefits for the citizens of Oregon, which would not emerge without the merger." He then moved into rhetorical high gear: "The Oregonian [newspaper] asks the question, 'Can you trust Enron?' On stewardship issues and public benefit issues, I've dealt with this company for a decade, often in the most contentious circumstances, and the answer is, yes."