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Movie Review: Enron - The Smartest Guys in the Room

April 24th, 2005

There are important lessons to be learned from the story of Enron, and Enron: The Smartest Guys in the Room uncovers some remarkable material to tell the tale. The movie, however, fails to draw out the broader issues raised by America's biggest corporate failure.

The story of Enron, as told by Smartest Guys, is the story of three men: Ken Lay, Jeffrey Skilling and Andy Fastow, aided and abetted by pretty much every financial institution you can think of. Add in the considerable human tragedy of company, and you have a compelling narrative, well constructed by the film makers.

Enron's rise to become one of America's most respected and powerful companies makes for interesting watching, and the film draws on a wealth of material, including internal videos, taped telephone conversations, interviews with former employees and congressional testimonies.

One of the most enthralling sequences concerns the California energy crisis, when Enron traders (among others) manipulated the power market to drive prices sky high. The rolling "brown outs" and billions of dollars in costs to the State and end customers caused widespread and enduring misery in California. Recorded conversations between traders gleefully discussing the money they were making as a result are enough to make anyone's blood boil (particularly, I admit, among those of us still footing the bill).

But this sequence, powerful as it is, also reveals the movie's biggest flaw. In its desire to keep the blame firmly pinned on Lay, Skilling and Fastow, the movie portrays (quite cleverly, actually) the traders as merely acting under orders. The truth runs deeper than that, and could have been more fully explored.

Another weakness is the movie's failure to explain exactly how Fastow's financial manipulations worked. Dry as such matters may be, they do lie at the heart of the issues raised by Enron's failure. One assumes that the film makers deliberately kept the descriptions at a high level to keep the movie's appeal with the broadest possible audience. And, to be fair, that is a laudable goal.

For, Enron: Smartest Guys in the Room is a film that deserves to be widely seen. Its source materials speak for themselves, so even if the maovie misses opportunities to expose some of the lessons learned, it's worth watching by anyone who wants to have money in their pension plan when they retire.

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