Class Notes (1,100,000)
CA (650,000)
UW (20,000)
PHIL (200)
PHIL215 (40)
Lecture

PHIL215 Lecture Notes - Making Money, Bethany Mclean, Sherron Watkins


Department
Philosophy
Course Code
PHIL215
Professor
Brian Orend

Page:
of 2
Are you a good notes-taker?
Looking for a collaborator: e-mail me at sampson.chen@gmail.com
PHIL 215
Lecture #3
Enron Video: The Smartest Guys In The Room:
Movie on YouTube:
http://www.youtube.com/watch?v=_xIO731MAO4
Synopsis:
http://en.wikipedia.org/wiki/Enron:_The_Smartest_Guys_in_the_Room
Reviews: http://rogerebert.suntimes.com/apps/pbcs.dll/article?AID=/20050428/REVIEWS/
50413004
http://www.paulkienitz.net/enron/smartest-guys.html
Gov’t: SEC - Security Exchange Commission
- Allowed Mark-to-Market accounting: http://en.wikipedia.org/wiki/Mark-to-market_accounting
Boom Market: Pump then dump: Invest then sell. (Eventually leading to market drop)
Sherron Watkins (Enron Whistleblower): http://en.wikipedia.org/wiki/Sherron_Watkins
Bethany McLean: http://en.wikipedia.org/wiki/Bethany_McLean
20,000 Lose jobs.
Enron’s collapse broke down Arthur Anderson: 29,000 jobs.
“Story of Synergistics Corruption” - As long as people are making money, they are happy to sign
off on stuff.
At its peak, Enron stock was sold at $90.0; at its lowest, Enron stock was sold at $0.40
Sarbanes-Oxley Act -> U.S.:
- Shredding Documents now illegal.
- Distance between accountants & clients to minimize conflict of interest
Interesting Takeaway for Enron:
Why do people behave badly?
1) Ignorance: doesn’t exactly apply here
2) Weakness of Will: in this case, greed
3) Self-Exception from Universal Standard: Narcissism
4) Situational Pressures: When people are tired, hungry, stressed, they are more likely to
commit moral mistakes (e.g. heart attack experiment)
5) Mimicking Leadership: Corruption seeps down due to leadership culture
6) Unusual Risk-Prone Tendencies:
(EOF)