Edison to Enron

The oil industry in the United States has been the subject of innumerable histories. But books on the development of the natural gas industry and the electricity industry in the U.S. are scarce. Edison to Enron is a readable flowing history of two of America's largest and most colorful industries.

It begins with the story of Samuel Insull, a poor boy from England, who started his career as Thomas Edison's right-hand man, then went on his own and became one of America's top industrialists. But when Insull's General Electric's energy empire collapsed during the Great Depression, the hitherto Great Man was denounced and prosecuted and died a pauper. Against that backdrop, the book introduces Ken Lay, a poor boy from Missouri who began his career as an aide to the head of Humble oil, now part of Exxon Mobil. Lay went on to become a Washington bureaucrat and energy regulator and then became the wunderkind of the natural gas industry in the 1980s with Enron.

To connect the lives of these two energy giants, Edison to Enron takes the reader through the flamboyant history of the American energy industry, from Texas wildcatters to the great pipeline builders to the Washington wheeler-dealers.

From the Reviews...

"This scholarly work fills in much missing history about two of America's most important industries, electricity and natural gas."
—Joseph A. Pratt, NEH-Cullen Professor of History and Business, University of Houston

"... a remarkable book on the political inner workings of the U.S. energy industry."
—Robert Peltier, PE, Editor-in-Chief, POWER Magazine

"This is a powerful story, brilliantly told."
—Forrest McDonald, Historian

Preface.

Introduction.

Part I. The Chief: Samuel Insull.

Chapter 1. Building General Electric.

Chapter 2. Dynamo at Chicago Edition: 1892-1907.

Chapter 3. Expanding Horizons: 1907-1918.

Chapter 4. Peak and Peril: 1919-1929.

Chapter 5. Plummet and Ruin: 1930-38.

Part II. The Boss: Jack Bowen.

Chapter 6. Meadows to Murchison.

Chapter 7. A Monumental Mistake.

Chapter 8. Florida Gas Company.

Chapter 9. Transco Energy Company.

Part III. Houston Natural Gas Corporation.

Chapter 10. The Prince of Bankruptcy: John Henry Kirby.

Chapter 11. Robert Herring and Ray Fish.

Chapter 12. Formation of Maturation.

Chapter 13. Robert Herring and After.

Epilogue Market Order, Political Challenges.

Bibliography.

Illustration Credits.

Name Index.

Subject Index.

“Summing Up: Highly recommended. General readers; all levels of undergraduate students.” (Choice, 1 March 2012)

ROBERT L. BRADLEY JR., a 16-year Enron employee and Ken Lay confidant, is a noted free-market scholar and public-policy entrepreneur. The founder and CEO of the Institute for Energy Research, Bradley is the author of numerous books and essays on the history and political economy of energy. He is an adjunct scholar of the Cato Institute in Washington, D.C.; a visiting fellow of the Institute of Economic Affairs in London; and an honorary senior research fellow at the Center for Energy Economics at the University of Texas at Austin. In 2002, he received the Julian Simon Memorial Award for his work on energy and sustainable development.
Bradley lives in Houston and likes to spend time in the beautiful Texas Hill Country. Energy, the master resource, is the world's largest industry and the bedrock of modern life. Without carbon-based energy, in particular, production and consumption as we know it would not exist. For most people, oil, gas, and coal have made life possible, not only pleasant.

During the last 150 years, the United States has been at the forefront of energy development. Robert L. Bradley Jr.'s Edison to Enron chronicles important swaths of this history by focusing on the great entrepreneurs of electricity and natural gas: their lives and labors, their faults and failures, their mortal enemies, and their sometimes more deadly friends.

Samuel Insull transformed the inventions of Thomas Edison into the modern electricity industry—only to have an Enron/Ken Lay-like fall late in his career. John Henry Kirby helped Texas enter the big leagues with timber, oil, and gas between his two bankruptcies. And Clint Murchison, Ray Fish, Robert Herring, and Jack Bowen, among others chronicled in the book, went through ups and downs in their quest to displace manufactured (coal) gas with cheaper, cleaner natural gas across the United States and in Canada.

Bradley's book covers market entrepreneurship, especially resourceship in regard to energy minerals. Yet there are also significant instances in which the energy creators engaged in political entrepreneurship, or rent-seeking, by extracting special government favor for pecuniary advantage. The waste and perils of the latter provide a stark contrast to the benefits and prudence of free-market enterprise.

Edison to Enron also tracks the career of Kenneth L. Lay, from a minor government bureaucrat to the heir apparent at Transco Energy Company to the wunderkind CEO of Houston Natural Gas Corporation (HNG). A shooting star of the energy business, Lay would transform HNG into mighty Enron, before meeting his unhappy fate less than two decades later—a story told in this book's sequel.

As a rare broad-based history of the American energy industry, Edison to Enron fills a critical gap in historiography and takes its place as a classic account of the energy nation par excellence during its most dynamic century.

Edison to Enron is the second installment of Bradley's trilogy on political capitalism, inspired by the rise and fall of Enron. Book 1, Capitalism at Work: Business, Government, and Energy, provides a worldview of market-based versus political business, as well as an interpretation of energy sustainability. Book 3, Enron and Ken Lay: An American Tragedy, chronologically describes the rise and fall of Enron and the post-Enron world.

Praise for Edison to Enron

"This is a powerful story, brilliantly told."
—Forrest McDonald, Historian

"This scholarly work fills in much missing history about two of America's most important industries, electricity and natural gas."
—Joseph A. Pratt, NEH-Cullen Professor of History and Business, University of Houston

"... a remarkable book on the political inner workings of the U.S. energy industry."
—Robert Peltier, Editor-in-Chief, POWER Magazine

Previously Published in the Political Capitalism Trilogy

Book I: Capitalism at Work: Business, Government, and Energy Published 2009 498 pp. ISBN 978-0-9764041-7-0

Capitalism took the blame for Enron although the company was anything but a free-market enterprise, and Ken Lay was hardly a principled capitalist. On the contrary, Enron was a politically dependent company and, in the end, a grotesque outcome of America's mixed economy.

That is the central finding of Robert L. Bradley's Capitalism at Work: The blame for Enron rests squarely with "political capitalism"--a system in which business firms routinely obtain government intervention to further their own interests at the expense of consumers, taxpayers, and competitors. Although Ken Lay professed allegiance to free markets, he was in fact a consumate politician. Only by manipulating the levers of government was he able to transform Enron from a $3 billion natural gas company to a $100 billion chimera, one that went in a matter of months from seventh place on Fortune's 500 list to bankruptcy.

But Capitalism at Work goes beyond unmasking Enron's sophisticated foray into political capitalism. Employing the timeless insights of Adam Smith, Samuel Smiles, and Ayn Rand, among others, Bradley shows how fashionable anti-capitalist doctrines set the stage for the ultimate business debacle.

"Bradley's book is especially timely, and it raises fundamental questions about the business of competition. Given the author's documentation, a wide audience might be served by reading Capitalism at Work."
—William A. Mogel, Energy Law Journal

"Fascinating, comprehensive ... far surpassing my own history of political capitalism done in the 1960s."
—Gabriel Kolko, Historian

"Recommended for public and academic library collections, lower-division undergraduate and up."
—CHOICE