Friday, June 12, 2009

Dillard's Just Following Standard Corporate/Government Practices


"The Last Official Act of Any Government is to Loot the Country". Congressman Ron Paul sponsored HR 1207 to find out who is getting the bail-out money.
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This week shareholders of Dillard's filed suit against the Dillard's board. Yell county resident Billy Berry's suit alleges that members of the Dillard family use the Little Rock department store chain as "if it were a private company." In this and another similar case, the plaintiffs seek damages not for themselves, but for the company. In other words, from their perspective they are trying to stop the Dillard family from using their positions of control to loot the company.

The suit alleges that the family members are paid well in excess of executives in comparable positions (which is saying something these days). All twelve board members are named, including newspaper magnate and banker Warren Stephens. The plaintiffs might wonder if all the newspaper ads Dillard's purchased in the Stephens' papers was a motivation to look the other way on potential excessive executive compensation.

While I don't want to weigh in on this particular case because I don't think I have enough facts to give an informed opinion (some may be asking themselves when that has ever stopped me before!). I do want to look at the possibility of such misconduct in the context of how our economy has run for the last 20 years.

Simply put, even if guilty, the Dillards are only doing business the way big business in this nation has routinely been done for the past two decades. We are in a looter's economy. Instead of succeeding by providing products that people want with good service and competitive price, the new executive class makes its money by the following program: Get people on the board whose interest is in turning a blind eye to your scam; cook the books and over-leverage your assets to make it seem like you are worth more than you really are; then use the friendly board and phony numbers to get yourself enormous compensation. When the scam has reached its peak, cash out on all the stock options.

This is the all-too-common path to riches in our distorted economy. Top executives are looting their companies instead of working for their real well-being. The shepherds who are supposed to be paid to guard and grow the flock instead enrich themselves by fleecing and eating them. That is the way it is done nowadays (Wal-Mart appears to be one of the exceptions).

What really gets me is that many people actually seem to have admiration for this process. I hear people say that they are looking for political candidates who "will run government like a business". They are! They are constantly expanding into new markets, and using debt-financing and accounting tricks to make their books look much better than they really are. We need people who WON'T run government the way (big) business has been run lately- with fraud, duplicity and avarice.

It has often been said that the last official act of any government is to loot the country. It may be later than we think, and the bailouts may represent the ruling elite's efforts to loot us just before national collapse. Why else would they send secret trillions of dollars to their friends while the average Joe is starved for cash? Goldman-Sachs and company are sitting on piles of it, purloined from the Treasury. Perhaps they are simply waiting for Main St. America to collapse a little harder, get a little more desperate, so that they can swoop down and buy us all out for pennies on the dollar.

It's the same thing with churches. My stomach wretches at how some of these pastors adopt "business models" to run their churches more like the corporate world runs things. The big winners in the corporate world (with some exceptions as I have noted) got that way by looting their own companies or using the government to tilt the formerly level playing field their way (see drug companies getting Texas Gov. Rick Perry to vaccinate all 11 year old school girls in the state schools for a sexually transmitted disease). Did Jesus go to the moneychangers so he could study their model for business success in the religion industry? Nope. He turned over their tables and drove them out of the Temple with a whip! Even the Prince of Peace can get riled up by these people.

I avoid churches that are going after the big-bucks crowd, and trying to emulate a spiritually defective corporate world to do so.

The 2x4 of reality is about to hit the forehead of this nation. I don't want this to happen, I merely fortell. When it does, perhaps some good will come of it. We may learn to reject false paradigms for "success" and crooked paths to "prosperity".

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