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A Times Editorial

Florida's Enron connection

© St. Petersburg Times, published January 28, 2002

Buy high, sell low?

Buy high, sell low?

That's not how investments are supposed to be managed, particularly on behalf of Florida's pension fund. But that is what happened to more than $300-million that one of the fund's money managers, Alliance Capital Management of New York, put into Enron. Nearly a third of the state's 7.6-million shares were bought after Oct. 22, when the Securities and Exchange Commission announced an investigation of Enron. Earlier, an Alliance executive -- since departed -- had sat on Enron's Board.

These circumstances alone warrant an investigation such as the one being conducted by the Florida Board of Administration, which fired Alliance Capital in the wake of the Enron collapse. But there are other circumstances that suggest the investigation should be made by some agency with no ties to Gov. Jeb Bush, who is one of the three members of the board.

There is another entity called the Manhattan Institute, a conservative think tank that has commented favorably on Bush's A-plus public school grading plan -- most recently, just last week, when Bush's press office made a point of publicizing the praise.

The Manhattan Institute, as it happens, identifies two of the members of its board of trustees, chairman Roger Hertog and trustee Lewis A. Sanders, as executives of Alliance Capital Management. Both are vice chairmen of Alliance.

These circumstances may be no more than coincidences. But they do suggest that a governor who relishes praise from the think tank that Hertog and Sanders help run should have nothing to do, even indirectly, with investigating how their other major concern cost the people of Florida more than $300-million.

The Legislature's Joint Auditing Committee would be a more appropriate entity to make this investigation.

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