[codeismightier]

I don't understand the hate against Walmart. It only has a profit margin of 3.12% [1] and return on assets of 7.69%. Now I suppose you could argue that all the profits are hidden away somewhere, but that sounds like an unfalsifiable statement. It certainly would be illegal to hide assets from shareholders.

[1] https://finance.yahoo.com/q/ks?s=WMT

[MrTonyD]

You're talking to someone who has spent most of his life in the Fortune 50 - working with executives who routinely hide the bulk of their wealth from any accounting. These techniques have been widely discussed in the press (if you look). So I must assume that you have, for philosophical reasons, chosen to disbelieve that the rich hide their wealth.

Edit: Not sure why I was downvoted. But I was in the room as we reassigned profits to offshore entities for accounting purposes. And I was in meetings with our senior executives who were arranging to pay themselves in undervalued offshore stocks "off the books". Those offshores provided inflated services and inflated goods to the corporation and avoided taxation while making the executives rich. The value of those offshore stocks was "reinflated" with a phone call. And that is just one company - the Big 3 accounting firms provide these services routinely for both the corporation and its executives. (And when we reassigned profits that had the effect of lowering profits - and even making income disappear. I've seen these techniques used at more than one company.)

[rhino369]

There is IRS accounting and GAAP accounting. You try to reduce profit for the former and maximize for the former.

Off shoring subsidiary profit shaving is a fairly common practice for IRS accounting. But all the profit stays on the corporate parents books in one way or another (they own the subsidiary). The point isn't to make the executives rich, but to make the shareholders richer by avoiding taxes.

Paying people in undervalued stock is common, but "off the books" sounds illegal. I don't know what that means.

Also most companies would never sell shares of it's subsidiaries. They like having total control of the subsidiary.

Big 4 firms wouldn't fuck over shareholders to get executives rich. Executives are small fish compared to the sorts of institutional investors who own F50 companies.

It's the Big 4 instead of the Big 5 because Arther Anderson got caught cooking Enron's books. It destroyed the firm. They aren't going to risk their entire business for some Walmart execs worth a couple million dollars.

F50 executives aren't the people who actually own the world. They are people who work for the people who own the world. If the executives are stealing, it's not something that is accepted. If found they'd be totally fucked.

[Terr_]

> The point isn't to make the executives rich, but to make the shareholders richer by avoiding taxes.

That's a distinction without a difference, since most of those executives' compensation comes through stocks.

[rhino369]

Through tiny portions of the stock. For mature public companies, executives own very little of the company unless they are founders or heirs of founders.

[omalleyt]

He's not saying the rich don't hide their wealth: he's arguing that corporations do not report artificially lower profits and then proceed to deny returns to their wealthy owners.

[xacaxulu]

Whenever I have a chance to learn some of these legal means of avoiding excessive taxation, I do in earnest. I see very wealthy people and it only drives me to emulate their business and investment strategies more. There are more than enough legal means of structuring your businesses, transactions and investments in ways that drastically reduce taxation. I made it about 4 years without paying any state or federal income tax. True it took a lot of work and planning, but the income retained was more than worth the effort.

[sytelus]

I think people are uncomfortable with the fact that despite of razor thin margins, multiple members of Walton family are in top 20 most wealthiest people on planet while majority of their workers lives on conditions that borderlines poverty. So somehow mass accumulation of wealth was possible at all but the top. Logically, this argument is weak because even if you redistribute all wealth from top, each employee would gain barely a one time payment of $10,000 just due to massive size of Walmart and would not significantly improve their condition over long term. So wealth re-distribution is not the cause of poverty of Walmart condition.

[jonathankoren]

Perhaps you should read up on it's labor practices. Two cases in point: They encourage their employees to sign up for food stamps, which results in a $6.2B government subsidy[1]. Also, the workers are intentionally paid so little (via only part-time employment) the company asks customers to donate food to their employees.

That company is scum.

[1] http://www.forbes.com/sites/clareoconnor/2014/04/15/report-w... [2] http://www.cnbc.com/2014/11/20/wal-mart-defends-employee-foo...

[nradov]

What's wrong with the government subsidizing low-income citizens? Where they happen to work is irrelevant.

[pcardh0]

So why do people work there if it such a bad job? My second job at Burger King wasn't great, but I didn't plan on making a career there.