An Edge to Enron's Lobbying Strategy

Skilling, then the energy giant's president, had almost single-handedly imprinted his combative style on the company's lobbying culture, and he used it now: We're Enron. We're the economy. Buy it.

But Joe Barton, a Republican congressman from Texas and ordinarily a fan of open markets, wasn't buying it. As chairman of a House Energy and Commerce subcommittee, Barton didn't think Enron had the votes then. Skilling told him he was wrong. So Barton kicked Skilling out of his office.

"There was no foul language, but he got so frustrated that he started telling me how to run my subcommittee," Barton recalls of their meeting.

"I told him I was no CEO of a Fortune 500 company, but I was not an idiot, and I knew he didn't have the votes. He told me I was wrong, that I was just being stubborn. I told him there was no reason to come see me again until things calmed down."

By many accounts, that exchange with Skilling--who subsequently became chief executive of Enron but resigned in August, before the company's collapse--was typical of Enron's lobbying efforts. But while the brash and raw tactics ruffled feathers, Enron was generally successful in getting its way.

"Enron was willing to be very active physically, as well as financially--showing up, testifying, walking the halls of Congress," said Daryl Owen, a partner at the lobbying firm of Palmetto Group, who attributes many of Enron's victories to hard work.

"Most companies focus overwhelmingly on Wall Street to the diminution of Washington," he said. "Enron correctly perceived that what happens in Washington" has a lot to do with "how successful you can be in business."

The priority for Enron was electric power deregulation, winning Washington's approval to open natural gas markets in all the states. When Congress balked, the company turned to the Bush White House, convincing the administration to replace the independent-minded chairman of the Federal Energy Regulatory Commission with a deregulation man--Pat Wood, whose name was on a list vetted by the company's then-chairman, Kenneth L. Lay.