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The Nation | THE FALL OF ENRON

A Feeling of Disbelief and Betrayal in a City Known for Boom and Bust

Enron: All over Houston, they're saying the company's euphoric years were a facade, lies, a house of cards.

January 26, 2002|MEGAN K. STACK | TIMES STAFF WRITER

HOUSTON — The woman in high heels and dark glasses stood on the brink of the road, chin thrust high, cardboard hoisted aloft for all of rush hour to read: "Ex-Enron employee. Will work for fair salary and benefits. Seeking a company with integrity."

This parkway twists from the marble and ivy of the well-heeled River Oaks enclave down to the shadows of downtown's skyscrapers. A few hours after sunrise, it stood thick with the sedans of energy barons, receptionists and lawyers.

When they read Sonia Garcia's sign, the white-collar parade broke into grins, slapped staccato toots from their horns, thrust their thumbs skyward. The 38-year-old single mother was a hit. But then, it isn't hard to win over a Houston audience these days--just grumble about Enron Corp.

The energy company's financial meltdown has left an entire town angry, cuckolded and saddened. The apparent suicide of Enron executive J. Clifford Baxter falls in a winter already heavy with empty pockets, evictions and jobless afternoons.

"These people's lives are coming unraveled all over the place," Rice University sociologist Stephen Klineberg said. "This was a horrible betrayal of the workers, and a horrible betrayal of the city."

Gone are the euphoric years of handshakes and hype, of baseball at dusk and black ties by night. Enron has proved just one more spectacular boom and bust in a city long defined by dizzy rise and devastating collapse.

"Everybody wanted to work there. I was so proud when I got the job," Garcia said. The graphic artist hasn't worked in weeks, not since Enron gave her half an hour to abandon her desk. Now, she's wondering how she'll make mortgage payments on her two-story house.

"It was all a facade," she said.

Facade. Lies. House of cards. Those words are sounding all over Houston. People who had no connection to the company say they are ashamed of its behavior. Former workers fret over whether to list Enron on their resumes. A sense that the city's reputation has been bruised hangs over a town already struggling with ugly-duckling syndrome.

"Unfortunately, it tarnishes the entire city, it plays on the psyche," said George Fleming, a lawyer who represents hundreds of shareholders and former employees in a suit against Enron. "They were so connected. People go, 'Oh, yeah, Enron, that's Houston."'

In real numbers, Enron was never crucial--far from it. It was 7,500 jobs in a city of 4 million people. Fewer than half of this town's workers have so much as a glancing relation to the energy industry.

But psychologically, symbolically, Enron had no equal. Its name graced the polished trestles of the new baseball stadium. Cash from the company laced the fine and performing arts, and kept charities afloat. It was no secret that Kenneth L. Lay was one of George W. Bush's most lavish benefactors, and a longtime supporter of the elder George Bush.

Enron sold energy, but represented power. It was a floor crowded with traders, a new way to get rich, a skyscraper full of ideas nobody else had dreamed up. Enron told this infant metropolis it was the center of a new economy, and eagerly Houston believed.

Then the story changed. The lies started rolling. The no-can-lose stock got sick and withered. Enron declared bankruptcy on a Sunday. On Monday, bosses rode the elevators down with grim news, and massive layoffs swept Enron's offices. Furious workers stumbled from the building with laptops and ergonomic chairs in tow. That was nearly two months ago, and the sting has barely faded.

"Even as the weeks go by, there is still a sense of disbelief and betrayal," said Sue Cruver, a spokeswoman for the WorkSource, an employment firm that's trolling for jobs for more than 1,000 displaced Enron workers. "There's a feeling that those responsible should, and will, pay."

Day by Day, Spirits Sink

Every day, it seems, the treachery deepens. As newspapers hit the stoop each morning splashed with new scrap of scandal, spirits sink a little lower.

"It starts to get next to you," said JoAnn Matson, a 40-year-old Enron worker laid off in December. "Every time you think it can't get any worse, there's some new document shredding or criminal activity. It makes you want to wash your hands."

This last week began with tales of destroyed documents, and ended with the discovery of Baxter's body. His Mercedes was parked up the street from his suburban home. A suicide note and a revolver were dropped at his side.

"It was tragic in the first place. This is just another tragedy," Terry Slater said. The owner of a Houston marketing firm, Slater bought the Baxter family's two-story house when the clan moved across town to a tonier neighborhood. "It's an indication of how bad it is."

Few Houstonians are able to articulate just what Enron was up to. Still, there was vague confidence in the enterprise. Inside its looming downtown offices, it was generally understood, Lay and his squad of wheelers, dreamers and weathermen were outsmarting the rest of the country.

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