- The Washington Times - Tuesday, September 5, 2006

It may be too late. Many believe that the war in Iraq and what the administration now calls “the struggle between freedom and terror in the Middle East” are on the brink of disaster. Meanwhile, the president is on the road giving a series of resolute speeches to rally the nation in this battle. The chance of any serious policy review is realistically none rather than even slim. But warning signs abound. Experienced voices inside and out of government have sounded alarms for some time. And a spate of recently published books with such ominous leading titles as “Fiasco,” “Disaster,” “Without Precedent” and “The One Percent Doctrine” presents devastating evidence and arguments supporting these dire forecasts.

The president is steadfast in his conviction that his administration is fighting the right wars in the right places and must stay the course no matter how difficult. His determination raises the crucial question. What if anything could induce the president to re-examine his strategy for winning these wars? A looming anniversary reminds us that infallibility is not a permanent fixture in the human condition. The anniversary is not September 11. It is the demise of the energy giant Enron. Comparisons between huge corporations such as Enron once was and strategies for winning wars can be stretches at best. However, recall what imploded the company that was rocketing toward stardom and beyond.

The former leader of Enron, the late Kenneth Lay, set his company’s sights far beyond becoming the world’s largest energy conglomerate. Lay’s grander ambitions were to make Enron the globe’s greatest trading company. This goal was fully supported by tens of thousands of employees, including some who had sipped the corporate Kool-Aid and welcomed a faster, darker track to fame and fortune. Admirers applauded the sweeping vision of the man heading a corporation long described as one of America’s best-led and managed. Critics and skeptics held fire, restrained by Enron’s record earnings and growth certified by its accounting firm Arthur Anderson.

The means for becoming a superpower trading company were SPE’s — Special Purpose Entities — financial vehicles for specific partnerships and deals. Large corporations used SPE’s but normally in relatively small numbers. Enron had thousands. Carried “off balance sheet,” potential liabilities did not count against the corporation. And certain projected revenues were booked as profits. To assure the financial soundness of these SPE’s, Enron guaranteed each with stock — paper then far more valuable than gold, diamonds, platinum and precious metals.

Enron had what many assumed were airtight ethical standards and a board of directors second to none in gravitas and experience. But oversight turned out to be minimal. Some later argued that was purposeful. When many of these largely independent and unoversighted SPE’s began to hemorrhage money and the price of the underwriting stock plummeted, Enron would run out of cash to cover debt and fold like a house of cards.

To win the war against terror, the president possessed a hugely ambitious vision for transforming the strategic landscape of the Middle East. The first phase was democratizing Afghanistan and then Iraq. From there, democracy would spread throughout the region. Local regimes would either be changed physically or through behavior. These wars became Bush’s SPE’s and the guarantor of success was the U.S. military. With only a tiny slice of that military, Afghanistan’s ruling Taliban were routed and a democratic government followed. Two years later, using just over 10 percent of the military’s manpower, Saddam Hussein was overthrown and the Iraqi army eliminated as a fighting force. Today, that military is being badly stretched, violence in Iraq has not been contained and democracy in the Middle East as Mr. Bush would have liked has not taken hold.

To cope with the agility and flexibility required in a very dangerous world, oversight of these wars outside the executive branch would purposely be minimal. Programs for treatment of enemy combatants, intelligence surveillance of Americans and foreign nationals and broader plans for Iraq were largely withheld from Congress and the appropriate courts. Only limited information was provided to conform with what the White House determined were legal and constitutional requirements and oversight was retained within the executive but without a single responsible authority.

The United States is not Enron and will not collapse. That does not mean the nation is infallible or can ignore these unmistakable danger signs. Yet, the president has proven reluctant and often unwilling to admit error.

If the president rejects or ignores these warnings, no one can predict with certainty that catastrophe lies ahead. Enron was not September 11. But Enron reminds us of the importance of taking second and third looks. We must be absolutely certain that the nation’s strategies for the war in Iraq and the struggle between freedom and terror are indeed winning ones. Too many signs suggest they are not.

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