
How Sears Was Gutted by Its Own CEO - WisNorCan
http://prospect.org/article/how-sears-was-gutted-its-own-ceo
======
notacoward
I'm old enough to remember when people like Carl Icahn and T. Boone Pickens
were famous for doing the same sort of thing. It's actually not bad in itself.
The bottom feeders do play a valuable role in business, just as literal bottom
feeders do in ecology. When animals or plants die, the process of converting
its remains into a rich substrate for new life is facilitated by various
organisms specialized for that task. So it is with dying businesses, and Sears
really was in a precarious position already.

The travesty is that the business equivalent of beetles and worms and fungi
reap such _disproportionate_ benefit from the process. They consume the entire
husk themselves, leaving a metaphorical desert instead of rich loam. The
leverage of having enough money to buy one company translates into personal
profit and thus even greater leverage for the next buyout. That's how you end
up with an economy dominated by termites, hollowing it out instead of helping
it grow.

------
vezycash
This is done in my country alot - both by the government and CEOs. A road in
my area has been in the works for a year now. Houses were demolished, shops
broken, and the tarred parts of the road ripped to make a wider road.

All these were done months ago. Now the road is a dust blower when sunny. And
a mud bath when it rains.

The road contractor is a private company called Arab Contractors. It's however
rumored that the company is partly owned by a previous state governor.

The ex-governor privatized tax collection - and this company takes a princely
percentage of collected tax.

He sold various state owned lands for pittance - sometimes directly to
himself, other times through holding companies. And you know the best part? He
used government funds to finance his private purchases.

He recently gave a land meant for a local government secretariat to a retail
chain. I'm guessing he'll collect rent and more for the favor.

I think the law of diminishing returns applies to the criminal status of an
act. After a certain number or scale, a crime is no longer a crime.

If a store manager sold inventory at half price to himself, or bought
inventory from a supplier (a company he owns) he'll be in jail.

------
olivermarks
I've always felt there was way more to this cynical, vulture capital financial
engineering than we have been told about. The shareholder lawsuits have shone
a little light on Lampert's sketchy asset stripping behavior and slow motion
starvation of Sears.

The successful lawsuit brought by individual investors who accused Sears of
not properly overseeing deals to avoid conflicts of interest against Lampert,
ESL, Seritage, and members of Sears' board of directors, which was won and
cost Sears 44m. [https://www.scribd.com/document/338974154/Sears-
settlement#f...](https://www.scribd.com/document/338974154/Sears-
settlement#from_embed?campaign=SkimbitLtd&ad_group=35871X943606X8ab638dbad32c97fe3eda5300ebaa887&keyword=660149026&source=hp_affiliate&medium=affiliate)

you would think Sears board member Steven Mnuchin would now be ineligible for
political office, but no... incredibly he's current United States Secretary of
the Treasury as part of the Cabinet of Donald Trump.

------
xt00
Candidate story for “Last week tonight”.. wow terrible..

