Smoke and mirrors

Enron is a reminder that theatre is peculiarly well-suited to unmasking the subterfuges of the banke

Theatre is a happily apt mode for examining the rise and fall of Enron. Actors are a dissembling bunch by trade, and the smoke and mirrors, legerdemain and suspension of disbelief required to conjure worlds onstage, sit remarkably close to the conning and gulling that Enron carried out to sell an illusion to the world at large. Enron's financial hubris has been well documented: suffice to say that the truly enormous gap between projected image and reality formed the basis of a spectacular $30bn fraud.

So it's with an uncanny sense of the appropriate that we watch Rupert Goold, this year's Olivier award-winning director, pile on the theatrical techniques in Enron, Lucy Prebble's exposé of the affair. And he throws everything at it: dance, cabaret, barbershop, mime, mask, not to mention a digital soundtrack and video projections.

Prebble evinces a flair for the well-placed analogy, making the impenetrable world of business blather entertaining and occasionally hilarious, even to this financial ingenue. Financial controller Andy Fastow's speech on the creation of shadow companies - his beloved "Raptors" - designed to eat Enron's debt, is a miracle of lucidity as he compares these fake companies and their ownership to a series of boxes within boxes, like Russian dolls.

Jeff Skilling, the man who masterminded Enron's shift from utilities company, selling real stuff, to increasingly fraudulent peddler of futures and derivatives, is observed astutely by both playwright and actor, Samuel West. In his own way, Skilling was as much of a frontiersman as the pioneers who rolled their wagons out in the hope of a better life, as he pushed the Texan oil giant towards the virtual and the speculative. West contrives to look at once weaselly and sympathetic, and whilst we never forget that he's a criminal, he's a criminal who can quote Mark Twain. He actually appears to lose weight during the course of the show, as his body is subtly upgraded - better hair, better eyesight - as befits his rise from professorial lackey to CEO. In some ways the cline of Enron's fortunes is mapped in West's hair: from greasy fringe to razor-smart cut to complete disarray.

Tim Piggot-Smith, playing Enron chairman Kenneth Lay, positively skips into his role as Midwestern Republican oil man, cigar-smoking pal to George W. It's a cross between J.R. Ewing and an evangelist preacher that he looks born to play. And the third in this unholy trinity is Tom Goodman-Hill, who plays Fastow with an East Coast nerviness that has him descending to the twitchiness of a 'Nam survivor as he keeps his Raptors at bay in the basement.

Prebble's gift for the analogous is shared by Goold's use of sound and image. Part Weimar satire, part student revue, various skits and cameos are strung along the narrative thread: so Arthur Anderson, Enron's compliant accountancy firm, are portrayed as a ventriloquist act; and it's more brothers Marx than Lehman when the bankers do a turn as conjoined twins. The giant Schwarzenegger is simply one actor on another's shoulders.

Admittedly some of these images are pretty crude - collapse of Twin Towers equals collapse of Enron, for example - but others are richly suggestive. When the Enron logo appears to have been drawn by Skilling's daughter, it also resembles the chalk outline of a dead body. When Skilling lifts his arms in supplication as he watches the deadly tickertape showing the share price plummeting, it looks like he is being crucified by the numbers.

The set's central monolith alternately veils and reveals the rarified upper floors of the Enron enterprise, like the black glass of an expensive office. It also serves as the backdrop to some highly seductive visuals, including archive footage and nostalgic 1990's montages. When competing with such strongly designed electronic media, there is a frailty to the actual humans on stage that the actors do well to minimize.

As an ensemble they move competently, but perhaps not exquisitely: some of the mime moments are uncertain, some of the transitions a little forced. In some ways, though, I would have liked this very roughness and fragility explicitly acknowledged. If theatre is the perfect metaphor for the fantasy hawked by the Enron cabal, then it would have been fitting to see the strain and sweat behind the illusion, the marionettes' strings, the whole mechanics of the show exposed.

That said, the show is an ingenious, clever, humane, energetic reminder - if we needed one - that things are not necessarily what they seem in financial affairs. Banker beware!

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The Autumn Statement proved it – we need a real alternative to austerity, now

Theresa May’s Tories have missed their chance to rescue the British economy.

After six wasted years of failed Conservative austerity measures, Philip Hammond had the opportunity last month in the Autumn Statement to change course and put in place the economic policies that would deliver greater prosperity, and make sure it was fairly shared.

Instead, he chose to continue with cuts to public services and in-work benefits while failing to deliver the scale of investment needed to secure future prosperity. The sense of betrayal is palpable.

The headline figures are grim. An analysis by the Institute for Fiscal Studies shows that real wages will not recover their 2008 levels even after 2020. The Tories are overseeing a lost decade in earnings that is, in the words Paul Johnson, the director of the IFS, “dreadful” and unprecedented in modern British history.

Meanwhile, the Treasury’s own analysis shows the cuts falling hardest on the poorest 30 per cent of the population. The Office for Budget Responsibility has reported that it expects a £122bn worsening in the public finances over the next five years. Of this, less than half – £59bn – is due to the Tories’ shambolic handling of Brexit. Most of the rest is thanks to their mishandling of the domestic economy.

 

Time to invest

The Tories may think that those people who are “just about managing” are an electoral demographic, but for Labour they are our friends, neighbours and the people we represent. People in all walks of life needed something better from this government, but the Autumn Statement was a betrayal of the hopes that they tried to raise beforehand.

Because the Tories cut when they should have invested, we now have a fundamentally weak economy that is unprepared for the challenges of Brexit. Low investment has meant that instead of installing new machinery, or building the new infrastructure that would support productive high-wage jobs, we have an economy that is more and more dependent on low-productivity, low-paid work. Every hour worked in the US, Germany or France produces on average a third more than an hour of work here.

Labour has different priorities. We will deliver the necessary investment in infrastructure and research funding, and back it up with an industrial strategy that can sustain well-paid, secure jobs in the industries of the future such as renewables. We will fight for Britain’s continued tariff-free access to the single market. We will reverse the tax giveaways to the mega-rich and the giant companies, instead using the money to make sure the NHS and our education system are properly funded. In 2020 we will introduce a real living wage, expected to be £10 an hour, to make sure every job pays a wage you can actually live on. And we will rebuild and transform our economy so no one and no community is left behind.

 

May’s missing alternative

This week, the Bank of England governor, Mark Carney, gave an important speech in which he hit the proverbial nail on the head. He was completely right to point out that societies need to redistribute the gains from trade and technology, and to educate and empower their citizens. We are going through a lost decade of earnings growth, as Carney highlights, and the crisis of productivity will not be solved without major government investment, backed up by an industrial strategy that can deliver growth.

Labour in government is committed to tackling the challenges of rising inequality, low wage growth, and driving up Britain’s productivity growth. But it is becoming clearer each day since Theresa May became Prime Minister that she, like her predecessor, has no credible solutions to the challenges our economy faces.

 

Crisis in Italy

The Italian people have decisively rejected the changes to their constitution proposed by Prime Minister Matteo Renzi, with nearly 60 per cent voting No. The Italian economy has not grown for close to two decades. A succession of governments has attempted to introduce free-market policies, including slashing pensions and undermining rights at work, but these have had little impact.

Renzi wanted extra powers to push through more free-market reforms, but he has now resigned after encountering opposition from across the Italian political spectrum. The absence of growth has left Italian banks with €360bn of loans that are not being repaid. Usually, these debts would be written off, but Italian banks lack the reserves to be able to absorb the losses. They need outside assistance to survive.

 

Bail in or bail out

The oldest bank in the world, Monte dei Paschi di Siena, needs €5bn before the end of the year if it is to avoid collapse. Renzi had arranged a financing deal but this is now under threat. Under new EU rules, governments are not allowed to bail out banks, like in the 2008 crisis. This is intended to protect taxpayers. Instead, bank investors are supposed to take a loss through a “bail-in”.

Unusually, however, Italian bank investors are not only big financial institutions such as insurance companies, but ordinary households. One-third of all Italian bank bonds are held by households, so a bail-in would hit them hard. And should Italy’s banks fail, the danger is that investors will pull money out of banks across Europe, causing further failures. British banks have been reducing their investments in Italy, but concerned UK regulators have asked recently for details of their exposure.

John McDonnell is the shadow chancellor


John McDonnell is Labour MP for Hayes and Harlington and has been shadow chancellor since September 2015. 

This article first appeared in the 08 December 2016 issue of the New Statesman, Brexit to Trump