Socialist Worker

How Enron made the lights go out

Issue No. 1800

CONFIDENTIAL MEMOS have revealed that the giant failed-energy firm Enron manipulated the energy crisis in California. California was plunged into darkness and suffered widespread power cuts two years ago. Power prices soared by up to ten times and millions were left without electricity.

Now it has been revealed that Enron traders manipulated the energy markets to deliberately cause shortages, raise prices and boost their own profits. The two memos reveal how the energy firm used methods it codenamed 'Death Star' and 'Fat Boy' to create and then 'relieve' phantom congestion in the electricity system.

This enabled the firm to get paid for, as one regulator put it, 'moving energy to relieve congestion without actually moving any energy or relieving any congestion'.

In December 2000 Enron bought power in one area of California at the controlled price of $250 a megawatt and then sold it in the north west of the state for $1,200 a megawatt.

The firm also used a scam dubbed 'ricochet' by Enron (known by others as 'megawatt laundering'). This meant Enron sold electricity across state boundaries, and then resold it back into California at massively inflated prices.


Canny granny

GLASGOW Housing Association went to great lengths to con council tenants to back privatisation in a recent ballot. The successful £1 million 'Vote Yes' campaign was fronted by 'Glasgow Gran' Kathleen Glasgow.

She appeared alongside New Labour ministers and claimed that transfer to private landlords was 'the only way forward' for the city's 78,000 council tenants. Within days of the ballot the canny granny bought her council house. She no longer wished to take the risk of living under a privately financed landlord-Glasgow Housing Association.


IS this what David Blunkett means by increasing the police's powers? Police officer Michael Metcalfe in South Wales launched his very own crackdown on a local youngster. Cardiff Crown Court heard that when a teenager called him a 'pig', the officer drove the youngster to a secluded spot and beat him.

The PC was jailed for three months after admitting the common assault of 17 year old Carl Simmons, and admitted he wanted to 'teach him a lesson'.
Thanks to Sam Ross in Newcastle for this story.


THE WORLD'S most expensive shoes are going on sale in Harrods. (Where else?) They will be displayed in a bulletproof cabinet and kept under armed guard. The £650,000 shoes are made from platinum thread, encrusted with 464 diamonds. A woman modelling the shoes said, 'Actually, they are extremely comfortable.' We should hope so for that price.


No free verse

A HEALTH authority in Birmingham has found a new way to boost staff morale. The authority has spent £40,000 on a poetry book, The Gift, which has been given to all 33,000 health workers in Birmingham.

A spokesperson for the health authority reassured the public that the money was not taken out of the patient care budget. But there's no such thing as a free verse-the money for the book came out of the staff budget.


OVER ONE million workers in Blair's Britain now have two jobs. The number of people forced to do two jobs, mainly because they are low paid, has risen by two thirds since 1984. Part time workers are three times more likely to take on another job to make sure they can get by.


Bollywood bar

BOLLYWOOD FILMS are the new big thing in British cinemas. Filmgoers have lapped up Asian-influenced movies like Monsoon Wedding. A new film, From India With Love, will be screened at open-air cinemas in Hyde Park and Old Trafford football ground this summer.

It stars the 'Brad Pitt of the Asian film world', Bollywood heart-throb Shahrukh Khan. Khan was flying in from India to attend the launch of a new musical show, hosted by Jonathan Ross.

The launch fell flat when Ross was left with no one to introduce to the press. Khan was held up at-yes, you guessed it-immigration.


More than echo of Thatcher

SPOT THE difference. (1) 'Ensuring that, where choice is exercised, cash for treatment goes with patients.' (2) 'To enable hospitals which best meet the needs and wishes of patients to get the money to do so, the money required to treat patients will be able to cross administrative boundaries.'

The first quote is from New Labour health minister Alan Milburn, in a document published just after last month's budget. The second is from a Tory white paper in 1989.

No wonder the architect of the internal market in the NHS, Alain Enthoven, has written that 'instead of the comparatively timid 'Thatcher-Enthoven' internal market' Milburn is going for a bold 'wide open market'.


Things they say

'THE REASON for the provision is that the queen cannot get a job and earn lots of money'.
ROYAL COURTIER on the inheritance tax dodge

'MOST PEOPLE are there because they want influence. There are people who want respectability, people who want gongs, and people who are in planning and property deals.'
GUEST at New Labour's fundraising £500 a head party for the super-rich at the Hilton

'THE IDEA that there are only a fixed number of jobs in the economy has been discredited. Migrants can also expand sectors, and create new businesses and jobs.'
HOME OFFICE SOURCE on the need for skilled workers

'I TOOK the view that Desmond was not a fit and proper person to run national newspapers. If someone who made money from porn publications came to me and offered to run my constituency campaign, all I can say is that I would have rejected it. The national party may have had other considerations.'
MARTIN O'NEIL, Labour MP

'WE HAVE acted with complete propriety. If you are asking if we are going to sit in moral judgement on those who wish to contribute to the Labour Party, then the answer is no.'
JOHN REID, Northern Ireland secretary

'THE record 70,000 prison population is overwhelming. It is created by the court's continuing love affair with custody.'
MARTIN NAREY, director general of the Prison Service


If you enjoy Socialist Worker, please consider giving to our annual appeal to make sure we can maintain and develop our online and print versions of Socialist Worker. Go here for details and to donate.

Article information

Inside the System
Sat 18 May 2002, 00:00 BST
Issue No. 1800
Share this article


Mobile users! Don't forget to add Socialist Worker to your home screen.