Enron and Net Neutrality: Rolling Blackouts for YouTube

12:00 PM May 26, 2006

Via serendipity or an evolved network intelligence, my Netflix queue served up an appropriate title in yesterday's mail:

Enron: The Smartest Guys In The Room

You may have seen the company in the news again yesterday. The judge set sentencing for 9-11, which Jeff Skilling had blamed for the company's implosion. Nice twist.

I came to Washington as an intern in 1996, and one of the first experiences of Beltway groupthink I had was energy deregulation. My off-campus program's speaker series sprouted an unending series of Protestants in suits with briefing papers exploring the economic, political, moral and practical necessity of freeing companies to trade electricity on the marketplace.

Asking these worthies why, exactly, when the existing power grid delivered stable and affordable energy and no discernible hue and cry from the hinterlands demanded porkbelly markets in kilowatt-hours, energy regulation was so universally taken as urgently necessary was akin to asking them their salaries -- capable of inspiring contempt or pity for the questioner, but certain to produce no intelligible answer. You'd as well have grown a second head right there in front of them.

And of course, the answer unstated had nothing to do with considered public policy and everything to do with a surging tide of utility industry kickbacks in the environment of consequence-free casino capitalism that ruled the roost in the Clinton area, and whose whirlwind we're reaping today.

The Greek elements of the Enron saga -- the hubris, the twisted brilliance, the outsized egos, the passion-play of employees looted of their pensions -- are irresistibly hypnotic, but these highly personal traits also obscure the true, structural dimension of neoliberal devastation for which Enron is a parable whose instructive lessons are badly needed. Even as the morning's editorial pages tremble with the intelligentsia's outrage at Enron's chicanery, Congress sits in judgment of an attempt -- the costume and scenery newly stitched, the script nearly worn-through from use -- to do to the commons of the Internet what utility deregulation did for the commons of public power. Hell, it's even got the same, fraudulent title: deregulation.

Make a new, commodity where yesterday was a healthy public park, a solution to a brand-new problem right here in River City. Lower costs! A brighter future! Don't you trust us?

What could possibly go wrong?

As Michael Gilbert remarks, the push for a "deregulated" Internet is part of a pattern rending the feeble tissue of civil society -- all for profit, profit, and devil take the hindmost, and not merely profit but the generation of monopoly rents utterly stifling and unproductive for the misfortunate host economy.

The Enronization of cyberspace. Rolling blackouts for YouTube.

Even Lay and Skilling in shackles, at the end, is a victory for the shareholders they plundered, against the particular schemes of these particular men to inflate their earnings statements. Such a shame they couldn't be content at $30 a share and straightforwardly raping their customers under the gaze of the SEC -- investors, to the barricades! For their real crimes, the sores pockmarking the Golden State and the still greater ones rotting the statute books, Lay, Skilling, Fastow, and all stand unpunished.

Overcome now like Cronus, Enron's progeny are the mightier for them ... and the young gods mean to thrive.

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