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No escape from the criminals

Published 30 July 2002 in The Denver Post
Copyright ©2002 by Ed Quillen. All rights reserved.

As a good citizen, as well as someone who likes his kneecaps the way they are, I prefer to avoid doing business with criminals. But it's sure getting harder.

For instance, how do you make a phone call? In most of Colorado, Qwest is the only local phone company. To be fair, it hasn't been convicted of anything, although it is under investigation for issuing misleading financial statements that is, lying to potential investors. And the company is busy restating its financial statements from recent years statements that were supposed to be accurate in the first place. Now it turns out that they're off by a billion dollars or so.

That really shouldn't have come as a surprise. A couple of years ago, Qwest (it was US West then) announced plans to sell some rural exchanges in Colorado and other states -- Salida was among them -- to Citizens Communications. However, Citizens had already bought some exchanges from US West, and discovered that US West had misstated the revenues. That's in court, but because Citizens couldn't trust the financial statements from US West, it backed out of the deal.

So we're stuck using Qwest, even if we'd prefer not to.

Make a long-distance call, and you might be using MCI, a subsidiary of WorldComm, now in bankruptcy court, thanks to accounting errors of about $4 billion. Somehow that seems beyond the failed to add up a column of numbers properly range, and appears more like deliberate criminal misconduct.

We need electricity, of course, and like most Coloradans, I get mine from the firm formerly known as Public Service Company of Colorado. Then it was New Century, and now it's Xcel. It's also under investigation by two federal agencies: the Securities and Exchange Commission and the Commodity Futures Trading Commission. It seems the company had been making simultaneous exchanges with Reliant Resources, and such deals are one way that Enron cooked its books to make it appear that the company was making money when it wasn't.

One reason I need the telephone and electricity is so I can get some work done with my computer. Although I've been working toward a Linux shop, it's slow. For instance, I was just forced into upgrading some hardware (a motherboard died about three weeks ago) and the new motherboard doesn't have any ISA slots. That meant getting a PCI modem -- which, of course, doesn't work with Linux.

So I've got to operate with Windows, which comes from Microsoft, which was found guilty of violating our nation's antitrust laws (the issues now before the court concern the appropriate punishment, not whether the company was illegally trying to establish a monopoly).

Even though that's criminal, that isn't what really bothers me about Microsoft. The annoying thing is that the company keeps telling us that it needs to preserve its freedom to innovate.

That is a clear implication that Microsoft once enjoyed a freedom to innovate, but if indeed it did, the company never exercised it. The computer I use now is a much different machine than the Osborne I that I used in 1984, but I can't find any differences that result from Microsoft innovation.

This one has a hard disk, which was invented by IBM. The improvements in the floppy drive come mostly from Sony. The CD reader was a Phillips invention. The mouse and graphical interface were invented by Xerox, as was its Ethernet connection to other computers. The modem was developed by the U.S. Department of Defense. The audio was likely devised by Creative Labs, though I haven't seen a definitive history there. When I'm using the command-line interface, it's one that traces back through CP/M and the DEC PDP-11. The laser printer has a Centronics interface, and it's a Hewlett-Packard that can be controlled by an Adobe program.

In short, I can't find anything that Microsoft created or invented, and yet the company claims to be based on innovation. It ought to be criminal to lie to the public in such a blatant way. As many people have noted, it isn't what's illegal in our system that is so frightening; it's what's legal.

But who's enforcing the laws we do have? Well, our federal government has recently started taking an interest in corporate accounting. One reform would be simple and cost nothing: just require that the income-tax returns of any publicly traded company be made public. That way, the companies could no longer keep two sets of books -- one for the tax man that shows they're losing money, and another for potential investors that shows they're rolling in lucre. They don't let us peons do that, so why should they let Enron?

Another reform would be for the federal government to start setting a good example by keeping honest books on its own projects, especially things like the benefit-cost analysis on Bureau of Reclamation water projects.

Oh well. I suppose that if you really felt a moral compulsion to avoid doing business with liars, you could always move to another country.


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