Book Description
An easy answer guide to the difficult questions surrounding Enron
What Went Wrong at Enron explains the critical steps, transactions, and events that led to the demise of a company that was once considered one of the most innovative corporations in the United States. Energy risk management expert Peter Fusaro gets inside Enron and provides a coherent account of the who, why, where, and when of this corporate debacle, without sacrificing the complexity of what has happened. Enron has been front-page news for months, but confusion still remains about what actually happened. What Went Wrong at Enron is written for readers who find themselves wondering what exactly is an energy trading company, what was the sequence of events that caused the largest corporate bankruptcy in U.S. history, and what does this all mean for me.
Customer Reviews:
This is the thinnest book on Enron that I read; it covers the whole affair very superficially........2006-05-20
I don't get the impression from reading the book that the authors have even tried to analyzed the financial holdings that was set up. It is the thinnest book on Enron that I read, for very good reason.
When Too Much is Barely Enough.......2005-06-10
Fusaro, P. and Miller, R. M., 2003. What went wrong at Enron, Everyone's guide to the largest bankruptcy in U.S. history. John Wiley and Sons, paperback, 240 p.
The moral and cultural lessons of Enron range from the need for ethical behaviour, grounding in truthfulness, honesty, transparency and a need for complete disclosure in accounting and corporate structure. This is the ultimate source of insight into how it all happened. Other sources also point to the underlying dangers represented by a betrayal of trust within the capitalism market system.
The Enron style of approach to flourish in newly deregulated energy and utility markets that have been engineered by governments since the mid 1980s. The levels of executive culpability and it shows the decay and or frailty of underlying value systems which should stand against such events. The events and actions that led to Enron's demise have far more and significant implications to the fate and quality of our own society.
But is Enron a systemic problem or is the ultimate problem the nature of market capitalism itself. If the latter then to avoid more Enron's it is necessary to have moral and ethical tethers to clearly defined absolute terms such as right and wrong (good and evil) in a corporate business environment, otherwise concepts on which an economic system depends, such as trust between all participants, will ultimately breakdown.
Internally, the dynamics of the Enron enterprise set out in this book show a salutary lesson of what should not be present in an apparently healthy and profitable corporate enterprise: failure of 'knowledge conditions', senior management being isolated from those at operational levels (?); individuals pursuing sub-goals that are contrary to overall corporate goals; restrictions on the flows of bad news as opposed to any positive 'spin'.
The underlying causes of an Enron outcome are in fact within the nature of corporations themselves. Their hierarchical structure, limited span of control, self-interest, limited discourse and intimidatory corporate culture all point to a flaw in the nature of many public-listed corporations. Some suggest that the Enron case is one which warrants a revaluation of the shareholder centric model of corporations; management actions should not longer be orientated at maximising the current share price.
Some see the lessons of Enron as being a company that, when in trouble, was unwilling to admit its own shortcomings and thus became driven to cover-up a few bad decisions by making even worse ones. An early admission and some critical changes in operations could have saved the trading side of the business. Instead profit growth at all costs an unwillingness to admit that poor decisions had been made, led to even more exaggeration and fraudulent reporting.
The key problem with Enron was that it had all the surfical signs of a good corporate citizen in place with corporate social responsibility, business ethics tools and status symbols all in place. The greatest danger is that the Enron situation is not atypical of many aspects of many corporate organisations: those who closed their eyes to wrong doings (in Enron) were rewarded; others who sought to give warnings were punished; the win-at-all-costs mentality. The Enron lesson is that business is in the long term only going to survive by virtue of developing and following ethical behaviour. No one single error occurred just the compounding of many errors, all of which were preventable. It was based on a success at all cost culture where the ends always justified the means.
Enron is not explicable as just ethical and moral failure without examining why these failures occurred. Enron was a corporate product of both willingness to bend the rules and the opportunity to bend them. Others suggest that there are limited lessons to be learnt from the Enron story: that is to say Enron is bankrupt because of speculation and legal but unsound accounting and financing schemes. This view suggests that this proves that the free-market works; speculators and those at the margin of the market must suffer as and when the market turns. As such Enron investors were punished by the stock market for their poor judgment. The energy markets adjusted to Enron's collapse with few problems. As for the stock market crash, well, booms and busts are a natural part of a healthy capitalist economy.
A must have book for anyone who wants to know the inside story.
Other academic reading:
. Benston, G. J., and Hartgraves, A. L., 2002. Enron: what happened and what can we learn from it. Journal of Accounting and Public Policy, 21, 105-127.
Carson, T. L., 2003. Self-interest and business ethics: some lessons of the recent corporate scandals. Journal of Business Ethics, 43, 389-394.
Chatergee, S., 2003. Enron's incremental descent into bankruptcy: a strategic and organisational analysis. Long Range Planning 36, 133-149.
Cohan, J. A., 2002. "I didn't know" and "I was only doing my job": Has corporate governance careened out of control? A case study of Enron's information myopia. Journal of Business Ethics, 40, 275-299.
Currall, S., and Epstein, M. J., 2003. The Fragility of Organizational Trust: Lessons from the rise and fall of Enron. Organizational Dynamics, 32 (2), 193-206.
Desai, A. B. and Rittenberg, T., 1997. Global ethics: an integrative framework for MNEs. Journal of Business Ethics, 16, 791-800.
Sims, R. R. and Brinkman, J., 2003. Enron ethics (or: culture matters more than codes). Journal of Business Ethics 45, 243-245.
Spector, B., 2003. HRM at Enron: the unindited co-conspirator. Organizational Dynamics, 32 (2), 207-22.
Dr I Lavering
Adjunct Professor
MBT Program UNSW
Thin.......2003-07-30
Let's start with the positives:
- the book is easy to read and reasonably well written;
- the basic facts of the story are covered;
- the book starts the story way back before the problems emerged so that you get a feel for what the business was up to.
But
- it is very short book for such a complex subject
- the "unravelling" - the investigations into "what went wrong" are (ironically) not well covered
- there is almost no coverage of the Andersen issues
So save your dollar, pound, euro or yen - don't waste it on this book.
A Shakespearean tragedy.......2003-07-09
What really went wrong at Enron?
A question that cannot be answered easily due to its nature of complexity. Thousands and hundreds investors, including Enron¡¦s employees who vested their retirement benefits in the s401k plan solely with Enron shares¡K..The horrible downfall alarmed the investment community, hurt the professional society (accountant, lawyer, underwriter etc.) and credibility of the monitoring commission¡K. The U.S. government reacted with the new legislation (Sabanes-Oxley Act) as an ¡§attempt¡¨ to tackle the problem, trying to put the company¡¦s management back on track to shoulder its fiduciary duty to the company¡¦s shareholder. But, does it work? The extent to which the various parties¡¦ responsibilities is still clouded.
If we do not really analyze the root causes which led to the Enron¡¦s downfall, we never know the answer. This book, written with the targeted general audience, is published at the right time to give the public a good chance to find the ashes in the smoke. At least for the moment.
According to this book, the tragedy was played by an arrogant CEO, greedy senior executive, loyal whistleblower, with the backdrop of a wrongly conceived free economy principle. The book is well written and gives insightful analyses based on the available evidence and traces. Some of the factors leading to the tragedy noted by the authors are:
*X The use of SPE (Special Purpose Vehicles) in accounting to keep off the accounting profits as well as to hide the potential liabilities
*X The constantly fearing environment built by the Corporate Culture emphasizing on a sense of urgency
*X Over-extension of operations in the deregulated energy and telecommunication market
*X Mark-to-market accounting principles
*X Less than full company¡¦s disclosure tendency
*X Valuation problem of customized contracts
* Making commitment as a counter-party to every trade in arbitrage markets
*X Trading from natural gas to electricity to bandwidth to 1800 different products in the Enron online
*X Conflicting company¡¦s strategy: asset-lite vs. debt heavy financed investments
*X Manipulated earning estimated to meet expectations
*X Deals financed by high Enron¡¦s stock price
*X Excessive investment in optic fibre networks
The list could go on and on. In fact, Enron went to the extent that deals were made just for the sake of making them. The more you read about the book, the more you feel it is a Shakespearean tragedy ¡V things are certain to get worse with all of these interrelated factors playing on stage. The general audience, those who believed that the play had a good ending, bought the tickets but found that the play was ultimately turn out to be a tragic one. They suffered. However, the director said: ¡§You bought the tickets because you believed in the play had a good ending. I didn¡¦t say that it would end in that way.¡¨ Refund? No.
The investigation into Enron¡¦s alleged sham trading and potential fraud scheme is still in progress as of this writing¡K..I highly recommend the book to the general readers, although it is better if you are financially literate. It is a thought-provoking and interesting read, especially to the CPAs.
Lacks specifics, too many pointless analogies........2003-05-22
Enron's greed and financial scandals, along with the rise and fall, are interesting in itself. This book, though it does explain the fall and is easily readable, isn't intriguing enough to capture the reader's attention. In fact, more than half is a description of how Enron came to be and what there business model is. A chunk of the book is just photocopied evidence pasted in the appendix. Only a minute section describes the scandal and accounting frauds.
The author loves anologies. He devotes pages to baseball card trading, and then sort of compares it to Enron's business. While these analogies help with understanding the business model, it's often over-simplified with a glaring lack of details. What I found was a lack of hard numbers and statistics which meant I couldn't put the failings into perspective. Also, the first half of the book where he details Enron, he seems to be praising their business, then hand wavingly, he points to a few corrupted examples. It almost appears that the author thinks Enron would still be a powerhouse if it wasn't for a few specific incidents.
As a book, it gets the job done. It shows the errors of Enron in a way that any non financial person could understand. It does tend to oversimplify, and it's glaring lack of numbers and details hurt it in the end.
Book Description
Late nineteenth-century San Francisco was an ethnically diverse but male-dominated society bustling from a rowdy gold rush, recovery from the earthquake, and explosive economic growth. Within this booming marketplace, some women stepped beyond their roles as wives, caregivers, and homemakers to start businesses that combined family concerns with money-making activities. Edith Sparks traces the experiences of these women entrepreneurs, exploring who they were, why they started businesses, how they attracted customers and managed finances, and how they dealt with failure.
Using a unique sample of bankruptcy records, credit reports, advertisements, city directories, census reports, and other sources, Sparks argues that women were competitive, economic actors, strategizing how best to capitalize on their skills in the marketplace. Their boardinghouses, restaurants, saloons, beauty shops, laundries, and clothing stores dotted the city's landscape. By the early twentieth century, however, technological advances, new preferences for name-brand goods, and competition from large-scale retailers constricted opportunities for women entrepreneurs at the same time that new opportunities for women with families drew them into other occupations. Sparks's analysis demonstrates that these businesswomen were intimately tied to the fortunes of the city over its first seventy years.
Amazon.com
Something strange happened to the Enron Corporation in the early 1990s: It went from a company that traded in tangible goods to one that dealt in pure abstractions, with shoddy accounting practices, astonishing compensation packages, and smoke and mirrors to obfuscate this new reality.
Company auditors, Sherron Watkins among them, warned top Enron execs from CEO Kenneth Lay on down that the company's increasing reliance on cooked books and phony reports "will implode in a wave of accounting scandals." As anyone who played the stock market or watched Enron suits do the perp walk on the evening news a couple of years ago will remember, that's exactly what happened. Texas Monthly editor Swarz and Watkins team up to offer this account, rich in anecdote and numbers alike, of what went wrong and who made it so. Though even-handed throughout, they serve up plenty of righteous scorn for the corporate leaders who enriched themselves as the company disintegrated, and for the name-brand politicians who abetted them.
Though Osama bin Laden's pawns barely dented the U.S. economy, observes Alex Berenson in The Number, Lay and his lieutenants brought it to its knees. Swartz's and Watkins's eye-opening account will rekindle new indignation over unpunished crimes and well-rewarded hubris, and it ought to be required reading in business schools henceforth. --Gregory McNamee
Book Description
“They’re still trying to hide the weenie,” thought Sherron Watkins as she read a newspaper clipping about Enron two weeks before Christmas, 2001. . . It quoted [CFO] Jeff McMahon addressing the company’s creditors and cautioning them against a rash judgment. “Don’t assume that there is a smoking gun.”
Sherron knew Enron well enough to know that the company was in extreme spin mode…
Power Failure is the electrifying behind-the-scenes story of the collapse of Enron, the high-flying gas and energy company touted as the poster child of the New Economy that, in its hubris, had aspired to be “The World’s Leading Company,” and had briefly been the seventh largest corporation in America.
Written by prizewinning journalist Mimi Swartz, and substantially based on the never-before-published revelations of former Enron vice-president Sherron Watkins, as well as hundreds of other interviews, Power Failure shows the human face beyond the greed, arrogance, and raw ambition that fueled the company’s meteoric rise in the late 1990s. At the dawn of the new century, Ken Lay’s and Jeff Skilling's faces graced the covers of business magazines, and Enron’s money oiled the political machinery behind George W. Bush’s election campaign. But as Wall Street analysts sang Enron’s praises, and its stock spiraled dizzyingly into the stratosphere, the company’s leaders were madly scrambling to manufacture illusory profits, hide its ballooning debt, and bully Wall Street into buying its fictional accounting and off-balance-sheet investment vehicles. The story of Enron’s fall is a morality tale writ large, performed on a stage with an unforgettable array of props and side plots, from parking lots overflowing with Boxsters and BMWs to hot-house office affairs and executive tantrums.
Among the cast of characters Mimi Swartz and Sherron Watkins observe with shrewd Texas eyes and an insider’s perspective are: CEO Ken Lay, Enron’s “outside face,” who was more interested in playing diplomat and paving the road to a political career than in managing Enron’s high-testosterone, anything-goes culture; Jeff Skilling, the mastermind behind Enron’s mercenary trading culture, who transformed himself from a nerdy executive into the personification of millennial cool; Rebecca Mark, the savvy and seductive head of Enron’s international division, who was Skilling’s sole rival to take over the company; and Andy Fastow, whose childish pranks early in his career gave way to something far more destructive. Desperate to be a player in Enron’s deal-making, trader-oriented culture, Fastow transformed Enron’s finance department into a “profit center,” creating a honeycomb of financial entities to bolster Enron’s “profits,” while diverting tens of millions of dollars into his own pockets
An unprecedented chronicle of Enron’s shocking collapse, Power Failure should take its place alongside the classics of previous decades – Barbarians at the Gate and Liar’s Poker – as one of the cautionary tales of our times.
From the Hardcover edition.
Customer Reviews:
Enron......Sad in a way.......2007-03-29
This book is a great account of what happened. When Enron collapsed, I was in my young teens so I really didn't pay much attention to it. However now seeing I'm in college as a business major I think it is an essential book that should be read by all business majors. It teaches what can go wrong when the wrong moves are put in place. Enron I think did everything possible to cripple itself with out seeing it until it was too late. The book takes off as rocket that a company is about to make it big. It takes from the early stages a company to a giant that falls to shambles.
The company employees the wrong people to the wrong positions. Andy Fastow I feel is the biggest crook outside of Skilling. Ken lay I feel was a good man who truly wanted to see the company prevail but with his blindness did not see the fore coming danger. Fastow reported to Skilling and Skilling just signed off on deals with out looking at them. If he would have seen what Fastow was doing with money from the company, chances are these deals would have never made it. However, with the wavering of the ethic code was just wrong. No company should ever break their code of ethics. If they do get out ASAP. Chances are it will lead to bigger breaks and will cause bigger problems and respect will go down the tubes.
This book is worth the cost and it will teach you what Enron did wrong. They should have just stayed in the Nat gas business and slowly dabble in other businesses instead of jumping into businesses without expertise. Go out and buy the book you should be pleased the way it is put together.
A Stockbrokers perspective.......2007-02-26
This book offered an unseen perspective into details about ENRON's dealings and people which should illuminate both old and new views about corporate governance, accounting policies, regulatory climate and unseen involvement by parties which contributed to the collaspe of ENRON.
Exceptional Story of the Enron Tragedy.......2006-11-10
With the recent sentencing of Jeffery Skilling, Mimi Swartz's work takes a complicated story of deciet and betrayal and explains the details in a concise and succint manner. A must read for all business leaders. A great read.
The most important reason for this book is to make the layman aware of just what a travesty the Enron scandal was............2006-10-18
The greatest reason to read this book is to get an appreciation for the scale of the collapse that was Enron. Also, you will get a description of what life was like at Enron on a personal level from an insider's view, as well as their view on what it had to do with the Company's downfall. Yes - this is one person's account, but there's enough factual information to back them up on the important points.
There are many books that are more technically oriented and probably less biased. Unfortunately, for this layman, they don't make very good bedtime reading.
Chaser for "The Smartest Guys in the Room" - kind of Enron lite.......2006-08-09
I recommend reading these 2 books together because TSGITR gets really dense in places, making for draining reading, but since the story is too incredible to put down, Power Failure takes it to a lighter level. I do think Power Failure hones in more on Andy Fastow, as co-writer Sherron Watkins worked directly with him, and the photograph of his little art project is downright chilling (you'll see what I'm referring to). Power Failure still has some great meat to chew on however; the proximity that Sherron Watkins had to the main players, particularly Lay and Fastow, lends itself to the amazing characterizations of these guys on paper. The two books follow a similar chronology and highlights, so it is interesting to compare the slight variations of the same episodes. Even though Sherron Watkins makes the most of her edge, being a primary player in the saga, the tip of my hat goes to TSGITR's writers for their downright nasty investigative reporting.
Book Description
This inquiry into the rise and fall of the great Wall Street boom of the 1990s, from bestselling author Roger Lowenstein, has all the hallmarks of a financial classic.
Roger Lowenstein, recognized as one of the best financial reporters of our time, turns his focus to the 1990s stock market and economic boom and bust in Origins of the Crash. With his singular gift for turning complex financial events into eminently readable stories, Lowenstein lays bare the labyrinthine events of the manic 1990s-including the collapse of Enron, the dot-com bubble, the accounting scandal at Andersen, and much more.
Drawing on his sense of history, Lowenstein inquires how a financial system that arose out of the wreckage of the Depression and that was intended to avert the miscues of that era could ultimately repeat the very same scenario of massive speculation and corruption leading to collapse. He discovers the roots of the recent crisis in the financial culture that cropped up in the 1970s and 1980s as America encouraged companies to hand out ever greater packages of stock options to their executives. In an enthralling narrative, Lowenstein ties together all of the characters of the great boom and bust: Alan Greenspan, Jack Grubman, Jack Welch, Abby Cohen, Henry Blodget, and a host of dot-com pioneers. But it is the collective rendering of such figures-the unique portrayal of the culture of the era-that truly distinguishes Origins of the Crash as the book that will frame our appreciation of the period.
Just as John Kenneth Galbraith's The Great Crash was the canonical text of 1929, Lowenstein's Origins of the Crash is destined to become the definitive account of the 1990s.
Customer Reviews:
Another Great Book!.......2007-09-10
Great read! I have been a financial advisor for over 15 years and love the markets and their history. Lowenstein has written two fabulous books about market changing events over the past decade, and "Origins" could be the best. For me, it was like reliving the boom (and bust) all over again; at times painful, very insightful, but not too techinical. Also, the section devoted to Enron was spectacular.
Prepare to be entertained but not educated.......2007-09-10
Mr. Lowenstein tells a compelling story about the fraud, avarice and delusion that infused the stock market's heady ride during the late 1990s, and its subsequent crash.
While the stories of Enron and WorldCom are quite gripping, Mr. Lowenstein doesn't really provide the type of analysis the book's title would imply. Mr. Lowenstein enumerates a few themes, such as executive pay and stock options, that undoubtedly played a part in executives' zeal to inflate their stock prices, but does not attempt to quantify the degree to which these themes influenced stock price movements or behaviors. He also focuses on a few stories, such as Enron, but fails to provide any technical analysis on price movements in the market as a whole. Stocks rise and fall off-stage, as in a Greek drama. In fact, there is not a single chart in the entire book.
The book also lacks detail on the mechanics of the accounting entities create by Andrew Fastow of Enron to offload liabilities. Surely the reader who cares enough about the topic to read this book must hunger for the R-rated version, rather than the G-rating given to Mr. Lowenstein's recounting. I was left craving more detail.
I would have loved to see a greater comparison between the 1929 stock market crash and our contemporary crash, but Mr. Lowenstein only devotes a few pages to such a comparison and uses faulty analysis. For example, he contends that there was less fraud in the 20s, and that it was "... mostly confined to a handful of brokers, bankers, and stock-pool operators". This understates the degree to which stock-pool operators manipulated stock prices to benefit a few insiders, and ignores some egregious characters, like Alfred Wiggins of Chase.
I really enjoyed Mr. Lowenstein's book, "When Genius Failed" and feel that he gave his readers more credit in that book. "Origins of the Crash" will leave the reader entertained but not educated. While it is a compelling read, it forces me back to the bookshelf to answer all the questions this book leaves unanswered.
A Valuable but Unhistorical Perspective.......2007-06-03
There's quite a lot to like in this book. Lowenstein has the details of the way the 'New Economy' of the '90s was hyped down pat, and how it all, inevitably, fell apart. But there's an important missing dimension. Lowenstein's book suffers from a lack of history.
As I read ORIGINS OF THE CRASH, I couldn't help but think of other books, describing astoundingly similar situtations. EXTRAORDINARY POPULAR DELUSIONS AND THE MADNESS OF CROWDS by Charles MacKay, UNACOUNTABLE ACCOUNTING by Abraham Briloff, CONTRARIAN INVESTMENT STRATEGIES by David Dreman, ONCE IN GOLCONDA by John Brooks, THE WALL STREET WALTZ by Kenneth Fisher, THE ONLY OTHER INVESTMENT GUIDE YOU'LL EVER NEED by Andrew Tobias, and especially THE MONEY GAME and SUPERMONEY by George 'Adam Smith' Goodman.
The core of the great bubble was the fact that human beings don't naturally think in a logical manner, can't deal with large numbers well, are short term oriented, have a great capacity for believing nonsense, overoptimism, the use of case and other faults being unravelled by the emerging disciplines of behavioral economics and prospect theory, associated especially with Amos Kahneman and Daniel Tversky. Depite Lownstein's belief that this time was different, in fact, the elements of the bubble were exactly the same as the canal and railway manias, the small computer boom of the late 1970s, the 'era of wonderful nonsense' in the 1920s, the Great Electronics and IPO Mania of the 1960s, and the conditions just before the Crash of 1987.
So read this book, but remember the perspective is overly narrow. And especially remember that it will all happen again, in your lifetime. I've already seen it three times in mine.
Covers the topic but flawed.......2007-04-29
Lowenstein took a juicy and let's face it easy to write about topics greed and avarice, and tossed in a bunch of throw away simpleton comments that overall made me dislike him almost as much as the thieves he wrote about. Why authors can't stick to the topics at hand these days without interjecting blatantly over and over their political bias is beyond me. He also tries to adjust Adam Smith writings to support his own which comes off nonsensical to say the least. Quoting the noted liberal NYT economist, Paul "I hate Bush" Krugman says it all about Lowenstein bias. Overall, Lowenstein came off as a lightweight and this book is written for people with their minds made up already.
An important book.......2007-03-08
Roger Lowenstein is a terrific financial journalist. One of very few who really knows what he's talking about. Each of his 3 books - this one, When Genius Failed and his Warren Buffet biography are must reading for any investor. If you are going to be dealing with Wall Street you MUST be aware of what you are up against. Those guys are not your pals - they want your money!
Customer Reviews:
I Question if he Even Worked There.......2002-04-16
This book tries to be an "inside account" of the failure of Eastern Airlines. I picked this book off the sale table and thought I would give it a try, mistake number one. The second mistake was working through 200 pages of the thing until I called uncle and gave up, the third and final mistake is that I still have it in my house - I only hope it does not effect the other books sitting close to it. This diatribe which seamed to me to be written in about 5 hours after an all night drinking binge, is undoubtedly some poor excuse to either claim ideas that were not his or maybe to push blame away from himself. Save your self the time and aggravation and pass on this book.
Eastern Airlines Deserves Better.......2000-12-30
Robinson's book is without a doubt the worst account of the demise of Eastern Airlines. It's value as history is only matched by Robinson's self-promotion. I suspect all the name-dropping and claims of inventing wonderful ideas that --almost-- saved Eastern are nothing more than an attempt to pave a way for his own corporate future.
This book is clearly worthless, as a history of Eastern, as a study of airline failure, or even as an acceptable account of the events surrounding the end of a great airline. If you are a collector of books about commercial aviation, you might want this one on your shelf (your lowest shelf) just for grins, but if you are thinking reading this book will give you some insight into Eastern Airlines, forget it. You'd be better off reading Bernstein's "Grounded"--only marginally better.
Average customer rating:
|
The Fallen Colossus
Robert Sobel
Manufacturer: Beard Books
ProductGroup: Book
Binding: Paperback
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ASIN: 1893122883 |
Book Description
The Penn Central debacle has much to teach investors, businessmen, and financiers about giant corporations caught in economic recessions or industries suffering a slow decline.
Customer Reviews:
A Detailed History.......2001-04-18
The Fallen Colossus is, on the surface, the story of the failure of the Penn Central Railroad. Sobel, however, takes great pains to chronicle the development of transportation in America. Starting with the the very begining of freight and passenger transit by roads and turnpikes, through the canal era, he ulitmately provides a thorough treatment of the eastern lines (and even a bit beyond when he discusses the impact of air and highway transport on the rail industry). The book is, at times, tedious with figures and balance sheets, though they are important to understanding railroads as a business and as a contributing factor to the near catastrophic collapse of the 1960s. The book was written as the Penn Central mess was just being cleaned up with the advent of Conrail and Amtrak. It is notable that the author notes the overly optimistic estimate by the directors of the new Conrail organization that they expected to take these bankrupt railroads and make them profitable by the 1980s. The author and others doubt this potential. Ironically, it worked and Conrail was reasonably successful where the Penn Central failed. Overall, an informative, if not lively, read for those looking into how not to run a railroad.
One curious item is the generic cover art. It cannot possibly be part of what was the Penn Central. The scene is one of flat desert with straight rails running toward a series of treeless hills on the horizon. It looks more like the Southern Pacific as this scene couldn't possibly be Appalachia. Details, details.
Book Description
Debt was an inescapable fact of life in early America. At the beginning of the eighteenth century, its sinfulness was preached by ministers and the right to imprison debtors was unquestioned. By 1800, imprisonment for debt was under attack and insolvency was no longer seen as a moral failure, merely an economic setback. In Republic of Debtors, Bruce H. Mann illuminates this crucial transformation in early American society.
From the wealthy merchant to the backwoods farmer, Mann tells the personal stories of men and women struggling to repay their debts and stay ahead of their creditors. He opens a window onto a society undergoing such fundamental changes as the growth of a commercial economy, the emergence of a consumer marketplace, and a revolution for independence. In addressing debt Americans debated complicated questions of commerce and agriculture, nationalism and federalism, dependence and independence, slavery and freedom. And when numerous prominent men--including the richest man in America and a justice of the Supreme Court--found themselves imprisoned for debt or forced to become fugitives from creditors, their fate altered the political dimensions of debtor relief, leading to the highly controversial Bankruptcy Act of 1800.
Whether a society forgives its debtors is not just a question of law or economics; it goes to the heart of what a society values. In chronicling attitudes toward debt and bankruptcy in early America, Mann explores the very character of American society.
Customer Reviews:
Good overview in how bankruptcy is okay for elite.......2005-06-22
Today the rich can still find ways to get out of the spendthrift debts with trusts, shelters, and bankruptcy, but we have to crack down on the debts that poor people get into like student loans, medical expenses, unemployment and the like.
This book tells us that the elite in the U.S. have always been all in favor of getting out of their own debt while holding the lowborn to the "morality" of insolvency for life.
Compelling and Highly Pertinent.......2002-12-15
Bankruptcy is in the air these days, from Enron to overextended former dot-commers. So-called "bankruptcy reform" -- intended to make bankruptcy more difficult and more punitive for debtors -- has been pushed by large creditors for years, and almost passed in the most recent session of Congress.
I'm a first-semester law student. I came to this book with a solid, basic understanding of modern bankruptcy law (gained as a business person and as a legal assistant prior to starting law school). As an undergraduate I took two semesters of legal history, and I have an extensive personal interest in American history.
Despite my background, until I read this book I had no real appreciation of the implications of failing to have an effective bankruptcy law. Focusing primarily on the second half of the eighteenth century (both before and after the American Revolution), Republic of Debtors does an amazing job of showing the social, humanitarian and economic consequences of failing to provide for an orderly discharge of debts in bankruptcy, especially when combined with creditors' remedies such as imprisonment for debt.
I, for one, had never confronted the fact that imprisonment for debt survived so long after the American Revolution, nor did I realize that, aside from some brief experiments, the US did not adopt a set nationwide laws on bankruptcy until the late nineteenth century.
Professor Mann tells the story by drawing on a wide variety of primary materials, including the diaries of imprisoned debtors and documentation of court cases. One particularly interesting chapter deals with the an elaborate form of self-government that evolved within one of the debtor's prisons. As many of those imprisoned were relatively well-educated and had been involved in the movement for independence from England, it was only natural that they would have their own constitution and elected government.
Then, as now, there was a tension between the moral and economic aspects of bankruptcy. On one hand, debtors can be viewed immoral spendthrifts, on the other, as hapless victims of the vicissitudes of a world-wide economy or the bad actions of others. These same tensions underlie the current debate on changes to bankruptcy law, driven by creditors who are seeking a return to a more punitive, moralistic approach to dealing with insolvent creditors.
I strongly recommend this book to anyone interested in the modern bankruptcy debate, early American legal history, or social and economic history generally. It is also just a cracking good read.
Cheers!
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Too Big to Fail: Policies and Practices in Government Bailouts
Manufacturer: Praeger Publishers
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Binding: Hardcover
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ASIN: 1567206212 |
Book Description
Usually associated with large bank failures, the phrase "too big to fail," which is a particular form of government bailout, actually applies to a wide range of industries, as this volume makes clear. Examples range from Chrysler to Lockheed Aircraft and from New York City to Penn Central Railroad. Generally speaking, when a corporation, an organization, or an industry sector is considered by the government to be too important to the overall health of the economy, it will not be allowed to fail. Government bailouts are not new, nor are they limited to the United States. This book presents the views of academics, practitioners, and regulators from around the world (e.g., Australia, Hungary, Japan, Europe, and Latin America) on the implications and consequences of government bailouts.
Book Description
The "self-made" man is a familiar figure in nineteenth-century American history. But the relentless expansion of market relations that facilitated such stories of commercial success also ensured that individual bankruptcy would become a prominent feature in the nation's economic landscape. In this ambitious foray into the shifting character of American capitalism, Edward Balleisen explores the economic roots and social meanings of bankruptcy, assessing the impact of widespread insolvency on the evolution of American law, business culture, and commercial society.
Balleisen makes innovative use of the rich and previously overlooked court records generated by the 1841 Federal Bankruptcy Act, building his arguments on the commercial biographies of hundreds of failed business owners. He crafts a nuanced account of how responses to bankruptcy shaped two opposing elements of capitalist society in mid-nineteenth-century America--an entrepreneurial ethos grounded in risk taking and the ceaseless search for new markets, new products, and new ways of organizing economic activity, and an urban, middle-class sensibility increasingly averse to the dangers associated with independent proprietorship and increasingly predicated on salaried, white-collar employment.
Customer Reviews:
This Book Is No Bust.......2001-05-19
Early in 2001, two big economics stories crossed paths and received vastly different coverage. The meltdown of the "dot-coms" dominated the front pages. Meanwhile, congressional passage of a new bankruptcy law that threatened to establish more favorable terms for creditors passed mostly under the radar screen.
Edward Balleisen's engaging social and economic history of bankruptcy in the mid-19th century United States anticipates today's trends, both noisy and quiet. It is a lively yet thorough chronicle of the kinds of booms and busts to which capitalism is prone. When a New Yorker of 1837 ruefully remarks that fortunes "have melted away like the snows before an April sun," it is easy to believe that his cruelest month is ours as well.
One of the book's many virtues lies in reminding readers that lesser-known stories-such as the passage of bankruptcy laws-may have a bigger long-term impact than panics and crashes themselves. Liberal bankruptcy laws have been and remain important for many economic and cultural reasons. Some of the characters in this book-and they are truly characters, a tribute to Balleisen's skills as a writer-yield to disappointment and become the security-seeking cadres of corporate capitalism. Others take the "double or nothing" pledge and become even more reckless entrepreneurs.
This is historical writing at its best: by opening a window on crucial but little-known episodes in the nation's past, it lets through rays of insight that illuminate the present.
Amazon.com
"Orange County," writes Mark Baldassare, "is a place that is widely known but largely misunderstood." That's especially true of the bankruptcy proceedings the California county was forced to initiate in late 1994 after risky investments led to a $1.64 billion dollar loss. Baldassare's close analysis of the situation reveals that the crisis cannot, as popularly imagined, be blamed solely on the actions of unchecked financial management. Although the county treasurer's investment strategy was "an accident waiting to happen," Baldassare points to a two-decade trend of voter initiatives to simultaneously minimize tax increases and control the allocation of state tax funds, along with Orange County's political fragmentation, as contributing factors. He also points out that, contrary to its reputation as a stronghold of wealthy conservatives, the county is primarily made up of middle-class suburbanites of moderate political temperament. In other words, Orange County is a lot like the rest of America, and what happened there can happen again. Although When Government Fails, with its historical data, statistics, and surveys, isn't always a lively read, it's a useful one for anybody who is concerned about the future viability of government at the community level. --Ron Hogan
Book Description
When Orange County, California, filed for Chapter 9 protection on December 6, 1994, it became the largest municipality in United States history to declare bankruptcy. In the first comprehensive analysis of this momentous fiscal crisis, Mark Baldassare uncovers the many twists and turns from the dark days in December 1994 to the financial recovery of June 1996. Utilizing a wealth of primary materials from the county government and Merrill Lynch, as well as interviews with key officials and players in this drama, Mark Baldassare untangles the causes of this $1.64 billion fiasco.
He finds three factors critical to understanding the bankruptcy: one, the political fragmentation of the numerous local governments in the area; two, the fiscal conservatism underlying voters' feelings about their tax dollars; three, the financial austerity in state government and in meeting rising state expenditures. Baldassare finds that these forces help to explain how a county known for its affluence and conservative politics could have allowed its cities' school, water, transportation, and sanitation agencies to be held hostage to this failed investment pool. Meticulously examining the events that led up to the bankruptcy, the local officials' response to the fiscal emergency, and the road to fiscal recovery--as well as the governmental reforms engendered by the crisis--When Government Fails is a dramatic and instructive economic morality tale. Eminently readable, it underlines the dangers inherent in a freewheeling bull economy and the imperatives of local and state governments to protect fiscal assets. As Baldassare shows, Orange County need not--and should not--happen again.
Customer Reviews:
Zzzzzzzz.......2000-01-28
Although informative, the author needs almost 400 pages to say what could have easily been said in well under 100.
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