The Smartest Guys in the Room: The Amazing Rise and Scandalous Fall of Enron by McLean Bethany & Elkind Peter

Author:McLean, Bethany & Elkind, Peter [McLean, Bethany]
Language: eng
Format: epub, mobi
Publisher: Penguin Group US
Published: 2013-11-26T00:00:00+00:00

CHAPTER 6

The Empress of Energy

Until the mid-1990s, most people who had heard of Enron had no idea who Jeff Skilling was. To the outside world, the person who was Enron, who had a reputation for turning impossible concepts into glittering realities, was not Skilling. It was Rebecca Mark. When she stepped off Enron jets in remote spots in third world countries, she was welcomed like a celebrity and surrounded by throngs of reporters. Mark was a high-profile woman in a very male industry at a time when building power plants and pipelines across the globe was thought to be one of the most glamorous, profitable businesses ever, a little like the Internet in the late 1990s. And she reveled in it, embraced it with every fiber of her being. “In her ambition, her drive, and her tenacity,” says a former Enron executive, “she was truly spectacular.”

Mark, who was put in charge of something called Enron Development upon Wing’s departure, not only kept her former lover’s legacy of ferocious independence; she furthered it. Her team’s offices were in downtown Houston—but across the street from Enron’s headquarters, not in it. The decor was all glossy wooden furniture and expensive Oriental rugs, a dramatic contrast to Skilling’s stark modernism. Mark’s fiefdom had its own compensation system, one that would make her incredibly rich regardless of the ultimate success of her projects. It had its own books, its own accounting system, and its own risk-management system. And it had its own culture, where the ex-military guys she liked to hire sought to outdo each other at parties featuring elephants, motorcades, and belly dancers, and where Mark herself once came roaring in on the back of a Harley to the beat of “Eye of the Tiger.”

It’s actually one of the more stunning things about Enron that Mark’s international business and Skilling’s trading business could coexist within the same company. Skilling wanted to figure out ways to separate energy from the hard assets needed to produce it; Mark’s business was nothing but hard assets. Trading was all about hedging away risk and quickly capturing profits. International development, where it could take a decade to recoup your money, meant taking on uncontrollable risks—everything from natural disasters to popular uprisings—and living through the inevitable trauma that comes with constructing a giant power plant in inhospitable territory. “Foreign direct investment,” says a former executive in Mark’s group, “is a matter of faith.” That was anathema to Skilling. “We were absolutely on opposite ends of the spectrum,” he once acknowledged. “Put us both in a room and we’d start screaming at each other.”

Within Enron, it was obvious early on that Mark and Skilling were on a collision course. The contempt they had for each other’s business was well known, and there was—and still is—a bitter divide between those who worked for Skilling and those who worked for Mark. Both have always insisted that their rivalry was a business issue, not a personal one. But for them, business was personal. Mark

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