Low tide: The wave of outrage over Enron should not obscure important approaches to governance.

• Author: Kaback, Hoffer
• Position: Quiddities - Brief Article

ONE NEED NOT possess dazzling oracular powers to conclude that the Enron debacle is a highly significant turning point in U.S. corporate history. Consider the following panorama:

Item: As I write this on January 10, White House press secretary An Fleischer is peppered for over 20 minutes with Enron-related queries. (Eventually, someone asks about the ongoing investigation into the Clinton pardons, whereupon CNN abruptly cuts away from its live coverage.)

Item: January 10 newspapers run major pieces about the Justice Department's creation of a special task force to conduct a criminal investigation of Enron. The New York Times quotes an unnamed government official: "This is a case of national scope and national significance...."

Item: A January 9 New York Daily News op-ed piece claims that Enron ex-CEO Jeffrey Skilling revealed his attitudes about business ethics during remarks made in class at Harvard Business School. Author John LeBoutillier adds that "Harvard and other business schools must pay more than lip service to the gross ethical blind spots that the Enron case has exposed."

Item: A January 4 New York Times editorial employs this high-octane wording: "[A] shocking national calamity...may lead to new federal regulations of pension plans, accounting procedures and energy markets....Criminal charges may still be in store for top Enron executives, who sold nearly $1 billion worth of their company stock, possibly knowing it was improperly inflated, before it plummeted. Thousands of employees were not so lucky...lack of public confidence in financial reporting...the latest and most dramatic instance of an accounting firm's failure to protect the public from largely fictional financial reporting....The accounting industry insists it can regulate itself, but the evidence points to the contrary..."

Item: Writer/ex-professional trader James J. Cramer fumes (in New York magazine's January 14 issue) that "Judging by the big fees that accountants get to consult with companies...the relationships have become totally incestuous, incubators of free-wheeling tricks to make stocks go higher regardless of the ethics trashed or the rules broken....Nobody's spent any time in jail for Cendant or Sunbeam or Waste Management, the three biggest fraud cases of the past decade.... [Their] executives promoted schemes to raise the stock price essentially so they could sell shares while the rest of us [held] the bag....I can't find an instance where a major...