Enron And Left Many People Without Money example essay topic

When the word "Enron" comes to people's minds all they can think about is words such as cheaters, fraud and con artists. It wasn't always this way. Kenneth Lay started this company in the 1980's when they merged two gas pipeline firms, the Houston Natural and Inter North, which were natural gas companies. Kenneth then changed the name to Enron and provided both oil and natural gas.

Stocks started at less than nine dollars a share. In 15 years Enron developed a company that was the 21st largest in the world, employing over 21,000 people all over the world. Stocks were as high as 90 dollars a share. With a half of America invested in the stock market, the economy was great. Money was being spent and earned. For Enron and Kenneth Lay things were great, but like everything all good things must come to an end.

For quite some time Enron had some concerns about the large amount of money they were investing into projects and not enough profits coming out them. People also worried that if enough of these wrong investments were made, it would add up to a lot of debt. Enron started to lie about their profits and hide the debts by putting them in small corporations with the intent to pay them back at a later time. Stock prices started to drop to about 30 dollars a share and people investing in Enron got worried. Some started to get out and Enron had no choice but to file for chapter 11 bankruptcy.

Stock prices dropped to a whopping decrease with one share being worth less than a dollar. The most human face of Enron's fall were the many workers from below the executive ranks who had invested their entire 401 (k)'s in Enron stock and would see their retirement nest eggs, which may have been work as much a million dollars just months earlier, vanish. This effected many peoples life's that invested in Enron and left many people without money to fulfill a happy retirement and left many students with no way to pay for their tuition at collage. The republicans and the United States support big businesses like Enron and they aid them, and because of these ties the US government could not bail Enron out without charges of corruption being close with the presidency. The Republican Party must send a message to all businesses that this kind of thing is not tolerated.

President Bush says in a speech about corporate responsibility in New York "we must call business leaders to a higher ethical standard". This will not happen if these Enron executives walk away with only a little slap in the hand. Enron would also support many government officials in aid for their campaign. John Ashcroft requested to be taken off of this investigation after receiving 57,000 dollars in campaign money from Enron. The entire Huston justice department was taken off the case because many if not all had family or knew someone who worked for Enron. U.S. secretary of commerce Donald Evans says capitalism has thrived in America because the government has not excessively regulated industry and because those running companies have been largely honest.

"But capitalism is at stake", said Evans referring to the recent Enron and WorldCom scandals. Besides protecting shareholders and employees, business leaders have a "higher responsibility" to be honest and protect capitalism and a "free enterprise system". So should Government set even more regulations on big business or should they just enforce the ones they have? There are a lot more honest companies in the United States than there are corrupt ones.

This means the American people must trust them and start to put money back into the economy. The Overseas Private Investment Corporation's political risk insurance and loans help U.S. businesses of all sizes invest and compete in more than 140 emerging markets and developing nations worldwide. OPIC, a U.S. government agency, assists U.S. private investment overseas because it is in America's economic and strategic interest. By charging user-fees, OPIC operates at no net cost to U.S. taxpayers, and its reserves currently exceed $4 billion.

In the money that was lost overseas the Overseas Private Investment Corporation is guaranteeing 544 million dollars in loans for projects in India, the Philippines, Turkey, Venezuela and Guatemala. Enron and its various partners still owe 454 million on those Loans, agency records show. OPIC had approved another 390 million in guarantees to build a controversial natural-gas pipeline from Bolivia to Brazil and to construct an electric power plant in Brazil. Enron developed their business in only fifteen years, and they were able to establish one of the largest business incorporations in the world. At the time stocks were at an extreme, allowing the economy to be great. That was until they were forced to file for bankruptcy, and as a result left many people in debt.

The economy suffered from the mistakes of Enron along with that of, A uther Anderson, World Com, and Tyco. In order to learn a valuable lesson and better the future of American business, the government must act on the issue by making them pay for it. Fus aro C. Peter, Ross M. Miller. What Went Wrong at Enron.

Hoboken: John wiley, 2002. Opic. Home. David Ivanovich. Government aid to Enron could Haunt Taxpayers. The Houston Chronicle.

Feb. 20, 2002.