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Book Review: 24 Days: How Two Wall Street Journal Reporters Uncovered the Lies That Destroyed Faith in Corporate America by Rebecca Smith and John R. Emshwiller

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Wall Street Journal reporters Rebecca Smith and John R. Emshwiller close the prologue to their book 24 Days: How Two Wall Street Journal Reporters Uncovered the Lies That Destroyed Faith in Corporate America with these words: “Some senior Enron officials, trying to explain the ruination of their own company, would point to the Journal pieces written during those first twenty-four days. For some of those officials, it may have marked the first time in their careers that they were overly modest about their own contributions.”

Such is the fate of those at the top of the food chain. No one in authority is ever responsible for the criminal activities they, themselves endorsed by the silence or disinterest. In the case of the last days of Enron, Ken Lay and Jeff Skilling were known to blame their company’s declining stock price on the bad publicity put out by short-sellers trying to capitalize on a decline in the value of Enron’s stock or the press, in this case, the Wall Street Journal.

The marketplace is clotted with books about Enron. Of those devoted as general reference are: Smartest Guys in the Room: The Amazing Rise and Scandalous Fall of Enron, Pipe Dreams: Greed, Ego, and the Death of Enron, Power Failure: The Inside Story of the Collapse of Enron, Conspiracy of Fools: A True Story. While these books differ subtly from one another in their focus, they all have in common and acceleration of the story after October 16, 2001; the day Enron announced a third-quarter loss of $618 million. Circumstances were further accelerated the next day when Enron publicly corrected an accounting error related to the so-called Raptor partnerships created by CFO Andrew Fastow, reducing Enron's assets (shareholder equity) are reduced by $1.01 billion. The freezing of Enron’s 401(k) retirement plan followed this action ostensibly for administrative changes.

Where these other books focus on the scandal as a whole, 24 Days: How Two Wall Street Journal Reporters Uncovered the Lies That Destroyed Faith in Corporate America instead focuses on the efforts of Wall Street Journal investigative writers Rebecca Smith and John R. Emshwiller to begin to unwind the Enron saga, focusing on the period between October 16, 2001 and December 2, 2001, the day Enron declared bankruptcy. The story is told from the point of view of journalists uncovering a story, revealing each new discovery chronologically as the reporters were alerted to them as opposed to the aforementioned books, which presented their cases from the inside out.

Smith and Emshwiller also make the Enron reportage part of the story, addressing The Smartest Guys in the Room’s Bethany McLean, the Fortune journalist who first questioned the veracity of Enron’s share price and Kurt Eichenwald, the white-collar crime report from the New York Times and author of Conspiracy of Fools. In the end of this story, the media were as much of the story as the Enron principles. Smith and Emshwiller deal even-handedly with all journalists involved. This is in keeping with the pair’s perspective for 24 Days.

A real value to 24 Days Part IV – “Aftershocks and Revelations.” Here, the relationship between Enron’s deal with Blockbuster and the special entity “Braveheart” is made clear as is the fall of the Enron Broadband division. Arthur Anderson and its collective guilt is revealed in retrospective real time. This section also addresses Sherron Watkins, the Enron Vice President who worked with Andrew Fastow and ultimately sent the now famous memo to Lay that started the internal ball rolling downhill. Watkins went on to write Power Failure with Houston journalist, Mimi Swartz. Smith and Emshwiller deftly reduce the Watkins story to intentions and perceived intentions better than any other book on the subject.

24 Days and all similar books end well before the final shoes dropped in the Enron case. Since the publication of these books, Ken Lay has died, Andrew Fastow and Jeff Skilling and a mountain of other players have gone to jail and some have completed their pornographically short sentences. A follow-up on Enron will eventually be needed to tell the whole story.

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About C. Michael Bailey

I am sanctified and Southern fried, My mama tried and daddy cried; I tell the truth 'cept when I've lied And I like my huevos on the side...