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American Morning

Enron Criminal Trial; He Writes the Songs...

Aired January 30, 2006 - 08:32   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

MILES O'BRIEN, CNN ANCHOR: I guess you could call them the smartest defendants in the courthouse, ready to face trial this morning. We're talking about the two top guys of Enron. The once high-flying energy trading outfit fell hard and fast four years ago, largest bankruptcy in this country, robbing thousands of average Americans of their retirement money.
Alex Gibney is writer/director/producer of a great documentary. If you want to understand Enron and how it fell, go rent this. It's out on DVD, "Smartest Guys in the Room" is what's it's called.

Alex, good to have you with us. you did a great job on the documentary.

ALEX GIBNEY, "ENRON: THE SMARTEST GUYS IN THE ROOM": Thank you.

M. O'BRIEN: And what I'd like to do, because I think people get put off by the accounting practices here. It confuses them. What interests me most is how you captured the culture of Enron and the personalities. First of all, let's talk about Ken Lay and who he is. We have a little clip here that I want to springboard off of that. Some of this from Ken Lay and some of this is from Sherron Watkins, who ultimately became a whistle-blower. Let's listen for a sec.

(BEGIN VIDEO CLIP)

KEN LAY: Despite the rumors, despite the speculation, the company is doing well, both financially and operationally.

SHERRON WATKINS: He was making all kinds of statements, reassuring employees, and not just employees, reassuring investors, we have no accounting irregularities, the company is in the best shape it's ever been in.

LAY: From the standpoint of Enron stock, we're going to bring it back.

(END VIDEO CLIP)

M. O'BRIEN: All right, so, Ken Lay, his defense is he didn't know what was going on. He was an idiot, I guess, would be his defense in this case. You talked to a lot of people that know Ken Lay, and there is evidence in your documentary that goes back to the late '80s that he knew of some shady dealings very early on in Enron's history. What's your thought on that?

GIBNEY: Well, that's an issue that may come up in the trial. The prosecution has asked permission to go back, which would speak to Ken Lay's ability to forgive lapses in ethical conduct.

I think the big thing about Ken Lay is he may still believe that Enron was a great company. I think he may suffer from delusions of grandeur that are as great as Enron once was itself.

M. O'BRIEN: Interesting, delusions of grandeur. He has a Phd in economics, son of a preacher, kind of a Horatio Alger-type story there. you get the sense, as you watch this, that it started off with tiny, little lies that just slowly, but surely got bigger.

GIBNEY: I think that's right. I don't think the top guys at Enron thought they were running a fraud from the get-go. I think they had this vision of a grand company they were going to build. And in that sense, it was like the American dream. But what it became was the dark shadow of the American dream, I think.

M. O'BRIEN: I should say. This is another clip from the documentary. I want to share it with people. We'll talk about that.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: I think Jeff Skilling is really a tragic figure in a classic sense of the word. He's a guy that people describe as incandescently brilliant, but he's also a guy who is radically different than he at times portrayed himself. He portrayed himself as somebody who has very tightly monitored risks. In reality, he's a gambler. He gambled away huge sums of money before he was 20 years by making wild bets on the market.

(END VIDEO CLIP)

M. O'BRIEN: That was the "Fortune" reporter who helped kind of bring the story to light initially, and did some great reporting early on.

Jeff Skilling, the guy who got beat up on the playground, the nerd, kind of the classic scenario we talk about maybe in Silicon Valley successes. Was he out to prove something, do you think?

GIBNEY: Yes, it was revenge of the nerds for a while. And for Jeff Skilling, the idea was everything. He was a McKenzie consultant, and he came into Enron thinking so long as you have a good idea, you should be awarded for it immediately, because the idea was everything.

But a lot of his ideas were pretty tough for people to handle. He believed that the company's culture should operate almost like a law of the jungle. Everybody would battle it out with each other inside the company, and that would steal everybody like warriors. But when you have the law of a jungle at the company, you can't be surprised when a few lions, and tigers and bears show up and start to eat everybody alive.

M. O'BRIEN: Well, it's interesting how they really let loose Darwinian theory there, and it was the survival of the fittest. And you can understand, especially as you listen in the documentary to a lot of these traders conversations, were recorded for other reasons, and you just hear this sense of complete lack of moral campus. How did that happen?

GIBNEY: I think it happened because the culture of Enron became a place where the end always justified the means. So what was important was not how you got there, but whether you got there. And that was something that I think let everybody go off course from a moral perspective.

M. O'BRIEN: So that would explain, whether it would be gleeful when people have no lights or power in California, because that particular event raises energy prices, and it means more profit?

GIBNEY: That's right. It made more money. And the idea that they would just laugh about the lights going out all over California, causing billions of dollars of damage, is really unbelievable to hear it.

M. O'BRIEN: It's going to be interesting how hard it will be to pick a jury in Houston. I bet you're interested to see that happen?

GIBNEY: I think so. I think Sim Lake, the judge, believes that he will be able to find a jury. After all, the theory is you should be tried by a jury of your peers. Well, Ken Lay is a Phd in economics. I imagine there are a lot of very smart people in Houston, and they'll find some who are willing to judge the guilt or innocence legally on the facts.

M. O'BRIEN: All right. Well, I invite you to check out the documentary if you want to understand the trial as it progresses, because it's going to be quite a trail, I'm sure, there. I wish we had cameras in the courtroom there. That would be nice to see.

All right, Alex Gibney, writer, director, producer of "Enron, the Smartest Guys in the Room." Thanks for being with us. Appreciate it.

GIBNEY: Thanks a lot.

(WEATHER REPORT)

(COMMERCIAL BREAK)

(MARKET REPORT)

M. O'BRIEN: But what about the "New You" participants? we have a very good track record to defend here. We -- I should say Sanjay, sergeant Sanjay Gupta. We'll check in with the teams tomorrow. We'll see how things, you know, the ups, the downs, the foibles. How are the twins are doing? You know, they have quite a competition going.

SOLEDAD O'BRIEN, CNN ANCHOR: Bitter competition.

M. O'BRIEN: In a twinly way. Twinly?

S. O'BRIEN: No. Go ahead, that's all right.

M. O'BRIEN: All right coming up later, a preview of tomorrow night's State of the Union Address. President Bush is down in the polls. Exactly how much is on the line for him? We will ask a man who has advised four presidents.

S. O'BRIEN: And ahead this morning, Barry Manilow, he writes the songs the whole world sings, or sings them at least. He's going to join us live next. We're going to ask him about his new album that's reunited him with the legendary producer Clive Davis. That's ahead on AMERICAN MORNING.

We're back in just a moment.

(COMMERCIAL BREAK)

S. O'BRIEN: The incomparable Barry Manilow is putting a new spin on some old favorites. He's recorded 13 of the greatest songs of the '50s for a new album. The man himself, who's been thrilling audiences really since the 1970s, Barry Manilow joins us. Nice to see you.

I love the album. It's great. Anybody, everybody is familiar with these songs from the '50s.

BARRY MANILOW, "THE GREATEST SONGS OF THE FIFTIES": Whenever I mention titles, I was just having dinner in a restaurant and I was giving this to a friend of mine, and somebody came over and said (INAUDIBLE), and they started reading the titles, and this is what happened.

S. O'BRIEN: Oh! Oh! Yes, yes.

MANILOW: That's what everybody does when they see these titles.

S. O'BRIEN: But you know, there's so many great songs from the '50s, how did you go ahead and pick?

MANILOW: It started out with 70 songs.

S. O'BRIEN: Really? How'd you whittle them down?

MANILOW: Well, there were some that, you know, didn't sound very good, like (INAUDIBLE), or you know, get a job, but there were -- we whittled them down to about 20 of them that actually did sound decent coming out of my mouth, and then we whittled those down to the 13 best ones, and that's how we did it.

S. O'BRIEN: I bet it was Clive Davis that came up with this idea? Is that right?

MANILOW: It is. Well, Clive Davis, there was only one Clive Davis. And somehow, over the years, over the decades, he somehow figures out these ideas that the public will connect with, whether it's artists...

S. O'BRIEN: When he came to you and said, Barry, I got an idea for you. I want you to do songs from the '50s?

MANILOW: I didn't get it. S. O'BRIEN: Really?

MANILOW: Well, the '50s kind of passed me by. I was around, but I was young and I didn't really get it. I got the Beatles. But the '50s, you know, I knew the songs, but I hadn't really studied them. And when he gave me this list of songs, I mean knew the titles, but I hadn't really paid attention to them.

But you know, you listen to Clive when he says I think if do it right, it's going be very popular. So I studied them and what I found were wonderful written songs that they had done in the '50s. And I sort of kind of dove in and created an album.

S. O'BRIEN: A lot of artists now are going forward. I mean, they're hip-hop and rap with some of the younger -- you know, like Elton John and Eminem and...

MANILOW: Yes, I don't think you'll be finding...

S. O'BRIEN: ... Santana with, you know...

MANILOW: You won't be finding me doing hip-hop.

S. O'BRIEN: Really?

MANILOW: I think I have to draw the line somewhere!

S. O'BRIEN: It might work, it might work.

MANILOW: I'll be watching it. I won't be doing it. That's not really my thing!

S. O'BRIEN: I read that "Unchained Melody," which is such a beautiful -- we'll play a little bit of it. Because we've been singing it, as well. I hate to confess we've been mangling this song all morning as I sing along with you. You work with a producer who produced this originally? Is that right?

MANILOW: No, no, no. I worked with Walter A., Walter Afiniasa (ph), who has produced Mariah Carey, Whitney, everybody. He's like -- but when I decided to do "Unchained Melody," it was daunting because nobody really can top the Righteous Brothers.

S. O'BRIEN: It's a -- yes. It's a...

MANILOW: You know. And I said I don't know whether I should do this. This is either a stupid move or a brave move, I'm not sure. But I needed help.

S. O'BRIEN: Brave in the end because it's beautiful.

MANILOW: Well, I need help. And Walter is brilliant at this. So we did it together. And he was the one that, you know, carried me through this one. And it's a beautiful rendition and I give all of the credit to Walter on that one.

S. O'BRIEN: What do you do next? I mean, are we going to hear Barry Manilow does the '60s, the '70s, the '80s?

MANILOW: I wonder. I wonder.

S. O'BRIEN: Really?

MANILOW: Well, let's see what happens. It comes out tomorrow. We'll see if anyone buys it or likes it.

S. O'BRIEN: You are the guy who sings the ballads. I mean, you know, I mean everyone sings along with your ballads. Is that why the '50s sort of worked for you, do you think?

MANILOW: I think Clive liked the idea of a -- the tone of this album is very romantic. And when I listened back to the whole thing, even though I was making it...

S. O'BRIEN: But, you know, not prissy romantic, like strong romantic.

MANILOW: No, it's passion.

S. O'BRIEN: The kind of song you want to sing along with.

MANILOW: It's passionate. I won't call it, you know, wimpy or anything. But when I listened back to it after it was all done, I must say, I think it's one of the most beautiful albums I've ever made. And I didn't know it when I was doing it at the time. But all together in one batch, it's just a beautiful, beautiful hour of music.

S. O'BRIEN: I concur. I was in your fan club in 1978. I was a member of the Barry Manilow fan club. I'm not sure I paid my dues.

MANILOW: You're so great. Thank you.

S. O'BRIEN: So thank you. Thanks for coming in to talk with us about it. It really is a wonderful CD. We loved it. Called "The Greatest Songs of the '50s." It's out in the stores on Tuesday. Barry Manilow, of course.

Miles?

M. O'BRIEN: All right, thank you both.

Today's top stories are straight ahead. Plus some "A.M. Pop." We've got a complete rundown of the big winners of last night's Screen Actors Guild Awards, including the movie that shocked everybody with its upset win over the Oscar fave, "Brokeback Mountain." Stay with us for more AMERICAN MORNING.

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(BEGIN VIDEOTAPE)

ANDREA MILLER, FOUNDER & PRES., TANGO MEDIA: My name is Andrea Miller. I'm 34. And I'm the founder and President of Tango Media. I'm in a great career. But nevertheless, I really feel that ticking clock.

Right now I probably average about 16-hour days. Like any entrepreneur will tell you, you live it and breathe it. Years go by and that's essentially all you do. When I thought about being a mom, it was one of these things that you just feel like, well, of course I'm going to be. But I'm one of these people, I think, like a lot of women, who, frankly, hadn't planned. And suddenly you're 34 and you're trying to have a child and the doctors are saying, hey, guess what.

I think our lifestyle timeline has gotten out of sync with our fertility timeline. So my wish for the future would be for science to advance to the point where women had many more options and had more control of their fertility.

M. O'BRIEN (on camera): Andrea represents an entire generation of working women who want to further their careers and yet someday still have kids. How close are we to the day when they can have it all?

(voice-over): This man believes he has the answer. Dr. Alan Copperman is a fertility specialist at New York's Mount Sinai Medical Center. Every day he sees patients just like Andrea whose careers may be rising but whose prospects for pregnancy are falling fast.

DR. ALAN COPPERMAN, MOUNT SINAI MEDICAL CENTER: Most of that is really related to a decline in egg quality with aging. When you're 21, 90 percent of your eggs are chromosomally normal. And when you're 41, 90 percent of the eggs are chromosomally abnormal.

M. O'BRIEN: For a woman who wants to postpone pregnancy, in vitro fertilization is an option. And thousands of babies have been conceived from frozen embryos. But what if you don't have a partner and want to wait until you do to conceive? Copperman says this is the future, freezing a woman's actual eggs.

COPPERMAN: We can thaw them out, fertilizing them by taking a singular sperm and putting him right through this egg which has been frozen and thawed and then implanting them.

M. O'BRIEN: But does it work? Worldwide, fewer than 200 babies have been born from frozen eggs, though several recent clinical trials suggest the success rate is growing.

And it's not cheap. The procedure today costs $10,000 and up. But in the future...

COPPERMAN: The hope is that the cost is going to come down to make this more affordable and that the success rate is going to get better and better. Ten years from now it's my hope that I could sit there with a patient, like Andrea or anybody else, and say that it is safe and it's effective.

(END VIDEOTAPE)

M. O'BRIEN: Still to come, millions of diabetics now can get rid of the needles and start inhaling their insulin. We'll talk to a doctor who tested the inhaler and we'll find out who can use it and who cannot. Stay with us for more AMERICAN MORNING.

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