Sam Walton was a man of considerable talent who, almost single-handedly, built the greatest retailing operation the world has ever seen, innovated an entirely new approach to inventory efficiency and became fabulously wealthy as a result.
While Sam’s accomplishments and contributions to innovation are legendary, Walton was also a devout anti-unionist and a committed Republican. So it may seem strange that none other than Sam Walton may, in no small measure, be largely responsible for returning Barack Obama to the White House for a second term.
Viewed by most as a ‘down-home’ guy who continued to drive his old pickup truck long after he had become a billionaire, Walton’s common man appeal belies his true financial genius – the ability to use his vendors’ money to finance the growth of his operations. The secret lay in his creation of a supply chain so efficient that he would order a product for his stores, get it on the shelf and have it sold in about three days. With payment to the vendors of these products not due for a full month following delivery, Walton was able to use vendor money for the remaining twenty-seven days of the month to purchase another’s goods on which he would profit while expanding his store count to perpetuate the process on a massive scale.
The secret to Walton’s skill in this area was his willingness to get ahead of his competitors in the area of technology. He was the first to utilize barcodes to automate the inventory tracking process and spent big-time on a private satellite system that could keep track of delivery trucks, hasten credit card transactions, and track sales data.
In other words, like many of the great business leaders of the last century, Sam Walton innovated on a huge scale.
Of course, it also didn’t hurt that – as a rabid anti-unionist – Walton managed to do a good job of not sharing the wealth with his many employees.
As his reward, Walton would become one of the wealthiest men on the planet – topping the Forbes list as the richest man in the world from 1982 to 1988. And while Walton’s difficult treatment of employees continues to be the policy of Wal-Mart stores to this day, I suspect that most Americans continue to hold Sam Walton up as an example of American inventiveness and the ‘can do’ spirit that made this country great and likely do not begrudge him his great wealth.
But can the same be said about the Waltons who inherited Sam’s fortune?
According to the Survey of Consumer Finances, the combined net worth of Sam’s family equals the combined wealth of the entire bottom 30 percent of Americans.
Let that sink in for a moment… and then consider that the same survey finds that the richest 400 Americans have as much wealth as the bottom 50 percent of Americans combined.
The fact that the Walton heirs have so much money certainly does not mean they’ve done anything wrong. While they can be judged by how they have conducted business at Wal-Mart since Sam Walton’s passing, or whatever else they have – or have not- done with their lives and money, they certainly cannot be blamed for inheriting the founder’s massive wealth.
Yet, their story highlights the issue that I believe is destined to become the deciding factor in the 2012 presidential elections – economic fairness. And it is on the basis of the president “owning” this issue that I believe that America will return Barack Obama to the White House for another four years.
Thank you, Sam Walton.
At the end of the day, it won’t be about the specifics of how we should or should not – or even if we should or should not – control the income disparity in America that now exceeds anything we have seen in our history. It will be about the common sense among what we now call “the 99 percent” who can’t help but see that something is fundamentally wrong in our country when one family can possess so much of the nation’s wealth – particularly when they provided no great innovation or advancement in and to the American way of life- while so many are suffering.
Elections are emotional events. Americans vote their pocketbook and their “gut.”
And while we can accept -and even cheer – those who accomplish great wealth as a result of great innovations that improve the lives of Americans and others throughout the world, we know all too well that much of the nation’s wealth is in the hands of people who have done little to nothing to benefit our way of life.
I’m speaking, of course, of the bankers who do little to add value but scam the financial system at our expense; corporatist who dramatically tilt the game in their favor as a result of having the money to rig the system; oil barons who control the flow of energy to the public’s great financial disadvantage; trust funders who spend their money perpetuating their wealth rather than improving the lot of the American people; CEOs who pocket the profits while their workers fall further and further behind the economic curve; and pharmaceutical executives who make billions by keeping prices high because they can.
These are the people Obama will be running against in 2012 no matter who the GOP fields as a candidate. And while the opposition may have hundreds of millions more to be spent on misleading the public, I’ll take the 99 to 1 odds all day long.
Expect the Walton family to become the poster-children for income inequality in America. Also expect much discussion on how they have chosen to spend the funds Sam Walton, who made huge contributions to American culture (for better or for worse), left to them.
Here’s a hint:
“When the Maryland legislature passed a bill requiring large employers to spend at least 8 percent of total wages on employee healthcare, Wal-Mart fought the bill by donating to Maryland’s governor, Robert Ehrlich, who later vetoed the legislation. Additionally, Wal-Mart “deployed at least a dozen Annapolis lobbyists” to prevent a veto override. When a similar bill was being pushed in California “which would [have] forced big employers like Wal-Mart to either provide affordable health insurance to their workers or pay into a state insurance pool”, Wal-Mart spent $500,000 to defeat the measure. And as Wal-Mart’s recent REIT tax scandal in North Carolina shows us, Wal-Mart will take great measures to avoid paying taxes.
Then there are the millions the Walton Family has spent to kill the estate tax so that they can hang onto all that money and continue the income disparity that plaques us. Jim Hopkins at USA Today writes:
The Waltons have joined a coterie of wealthy families trying to save fortunes through permanent repeal of the estate tax…review of public documents reveals a small-town Arkansas family emerging as a political juggernaut on tax issues, extending Wal-Mart’s influence over U.S. society even more.
Starting to get the picture?
While Sam Walton’s legacy has dramatically impacted on how we buy goods and services in much of the world, who would have imagined that his legacy might also play a key role in re-electing a president he would have greatly disliked?
The world can be a very ironic place.