“Work­ing on a fork­lift
In the night shift;
Work­ing on a night shift,
With the fork­lift,
from A.M. (Did you say that? Why did you say that?)
to P.M. (Work­ing all night!)
Work­ing on a night shift, yeah!”
‑Bob Mar­ley, writ­ten while work­ing in a Dupont ware­house in Delaware

Like a lot of peo­ple, I’ve been real­ly nice to Joe Biden sim­ply because he isn’t Don­ald Trump. How­ev­er, now that the mask has come off and we see what he is ACTUALLY about in regards to Ukraine, I think his back­ground is worth fur­ther scruti­ny. Above all, his sym­bi­ot­ic rela­tion­ship with the Dupont con­cerns is cen­tral to under­stand­ing Joe.

https://www.wsj.com/articles/duponts-up-and-down-history-shaped-bidens-views-on-business-11606157282

DuPont de Nemours : Up-and-Down His­to­ry Shaped Biden’s Views on Busi­ness

11/23/2020 | 03:04pm EDT
By Jacob M. Schlesinger
To see what Pres­i­dent-elect Joe Biden thinks is wrong with the econ­o­my today and how he would try to fix it, look to his rela­tion­ship with DuPont Co. For much of his life the com­pa­ny was the largest employ­er and phil­an­thropist in his home state of Delaware, fund­ing schools, libraries and the­aters.

At age 29, Mr. Biden staffed his first Sen­ate bid with DuPont employ­ees, who opened a cam­paign office on the high­way built by and named for the chem­i­cal giant. While bash­ing oth­er big com­pa­nies for tax avoid­ance, Mr. Biden sin­gled out DuPont as a “con­sci­en­tious cor­po­ra­tion” for pay­ing a high­er rate. He cel­e­brat­ed his long-shot 1972 vic­to­ry in the Gold Ball­room of the Hotel du Pont.

More than four decades lat­er Mr. Biden, by then Barack Oba­ma’s vice pres­i­dent, watched with con­cern as DuPont, strug­gling to boost prof­its, was tar­get­ed by an activist share­hold­er, sold the hotel, eased out its chief exec­u­tive, merged with anoth­er com­pa­ny, split into three pieces and cut its Delaware work­force by one-fourth.
Mr. Biden sel­dom pub­licly dis­cuss­es DuPont by name, but in pri­vate, accord­ing to aides, he reg­u­lar­ly cites its restruc­tur­ing and down­siz­ing as Exhib­it A of mod­ern cap­i­tal­ism gone awry. He often bemoans what he believes to be cor­po­rate Amer­i­ca’s pri­or­i­ti­za­tion of investors over work­ers and their com­mu­ni­ties.
His plat­form dur­ing this year’s cam­paign was thick with poli­cies aimed at alter­ing cor­po­rate behav­ior: a min­i­mum cor­po­rate tax to curb tax avoid­ance, penal­ties for ship­ping jobs over­seas, mea­sures that make it eas­i­er for unions to form. “It’s way past time we put an end to this era of share­hold­er cap­i­tal­ism,” he declared in a July speech.
Mr. Biden can expect a back­lash from many econ­o­mists and busi­ness lead­ers, who argue that his gauzy view of his­to­ry over­looks the inef­fi­cien­cies of the old cor­po­rate titans — which ulti­mate­ly harmed their work­ers and com­mu­ni­ties — and ignores the pres­sures of glob­al­iza­tion and the dynamism of a mod­ern econ­o­my that allows health­i­er upstarts to replac­ing slump­ing behe­moths.
“I don’t think cor­po­rate Amer­i­ca has very much to apol­o­gize for,” says John Engler, who was head of the Busi­ness Round­table, a trade group of the nation’s largest com­pa­nies, in 2016, when he attend­ed one of a series of meet­ings Mr. Biden host­ed with CEOs and econ­o­mists dur­ing his vice pres­i­den­cy to try to hone a new cor­po­rate-gov­er­nance agen­da.
“If com­pa­nies get top-rat­ed on oth­er mea­sures, if they’re very woke, it won’t save them if they don’t make mon­ey for investors,” Mr. Engler, a for­mer Repub­li­can gov­er­nor of Michi­gan. “I don’t think there’s a role for gov­ern­ment in that.”
Despite his crit­i­cism of cor­po­rate behav­ior, Mr. Biden is in some ways clos­er to Mr. Engler than to the Demo­c­ra­t­ic Par­ty’s left wing, which wants to require big com­pa­nies to obtain a fed­er­al char­ter impos­ing a new list of require­ments on exec­u­tives such as putting work­ers on boards. Mr. Biden often indi­cates he’d rather change cor­po­rate Amer­i­ca not through reg­u­la­to­ry fiat but moral sua­sion by per­suad­ing exec­u­tives to take a broad­er view.
A career politi­cian, Mr. Biden has no direct busi­ness expe­ri­ence. But he often says his per­spec­tive is shaped by his roots in Delaware, its busi­ness-friend­ly laws and its long his­to­ry as the pre­ferred incor­po­ra­tion locale for large U.S. com­pa­nies.
DuPon­t’s loom­ing pres­ence there has been a major influ­ence. “He views DuPont as a proxy for a respon­si­ble cor­po­rate cit­i­zen, for a lot of Amer­i­can cor­po­ra­tions in the ’50s, ’60s, and into the ’70s,” says Don Graves, who was Mr. Biden’s pol­i­cy advis­er dur­ing the Oba­ma admin­is­tra­tion and now works on his tran­si­tion team. “He felt that over time DuPont and oth­ers began shift­ing away from that fram­ing, because of the focus on quick share­hold­er returns.”
There are par­al­lels between Mr. Biden’s out­look on com­merce and pol­i­tics, both worlds he often por­trays as more benign in his youth — some­times gloss­ing over the tur­moil, or the dom­i­nance of white men — as an era when CEOs had a stake in their com­mu­ni­ties, and law­mak­ers com­pro­mised across par­ty lines. He often sug­gests that a calm­ing, com­pro­mis­ing leader such as him­self could revive a more gen­teel age, a view some crit­ics con­sid­er naive.
“It used to be that cor­po­rate Amer­i­ca had a sense of respon­si­bil­i­ty beyond just CEO salaries and share­hold­ers — cor­po­rate Amer­i­ca has to change its ways,” Mr. Biden told a group of donors at a July fundrais­er. He then added: “It’s not going to require leg­is­la­tion. I’m not propos­ing any.”
Mr. Biden is swim­ming against a tide of Amer­i­can busi­ness ortho­doxy that is often traced to an influ­en­tial 1970 essay by the late Nobel lau­re­ate econ­o­mist Mil­ton Fried­man, “The Social Respon­si­bil­i­ty of Busi­ness Is to Increase its Prof­its.” Like many on the left, Mr. Biden blames it for ush­er­ing in an era when exec­u­tives pur­port­ed­ly sac­ri­ficed work­ers and com­mu­ni­ties for the sake of next quar­ter’s bot­tom line — break­ing what he calls the “basic bar­gain” of shared pros­per­i­ty. “We act like Mil­ton Fried­man is still alive and well on deal­ing with cor­po­rate pol­i­cy,” he told a group of Indi­ana donors in June.
“DuPont is a clas­sic exam­ple of what Mil­ton Fried­man did,” said Ted Kauf­man, a for­mer DuPont engi­neer who helped devel­op Cori­an coun­ter­top mate­r­i­al, joined Mr. Biden’s staff in 1972, and now co-chairs his tran­si­tion team. For Mr. Biden, he added, DuPon­t’s bat­tle with activist investor Nel­son Peltz and his Tri­an Fund Man­age­ment LP “was an epiphany.”
Tri­an says Mr. Biden’s diag­no­sis is wrong. DuPon­t’s “under­per­form­ing rel­a­tive to its peers...negatively impact­ed all stake­hold­ers includ­ing employ­ees, cus­tomers, and com­mu­ni­ties,” a Tri­an spokesper­son said. Tri­an’s goal was “return­ing the com­pa­ny to best-in-class status...for the ben­e­fit of all its con­stituents, not just its share­hold­ers.”
The small­er DuPont left after all the restruc­tur­ing takes a sim­i­lar view. “Over its 200-year his­to­ry DuPont has evolved,” says spokesman Dan Turn­er. “The one con­stant has been deploy­ing our sci­ence and inno­va­tion to remain a leader...committed to deliv­er­ing sus­tain­able val­ue to all the cus­tomers, employ­ees, share­hold­ers and com­mu­ni­ties we serve.”
Many aca­d­e­m­ic econ­o­mists and cor­po­rate-gov­er­nance experts say Mr. Fried­man is still most­ly cor­rect, although the debate has evolved in recent years, with more exec­u­tives say­ing they now look beyond share­hold­ers, and more share­hold­ers say­ing they look beyond short-term prof­its.
The rise in so-called ESG invest­ing — in which funds rate com­pa­nies by envi­ron­men­tal, social, and gov­er­nance bench­marks in addi­tion to prof­itabil­i­ty — sug­gests the mar­ket may be mov­ing past the osten­si­ble focus that Mr. Biden and oth­er crit­ics decry.
The Busi­ness Round­table last year issued a state­ment declar­ing that CEOs should “lead their com­pa­nies for the ben­e­fit of all stake­hold­ers — cus­tomers, employ­ees, com­mu­ni­ties and share­hold­ers.” That replaced a 1997 direc­tive that a com­pa­ny’s “para­mount duty...is to the cor­po­ra­tion’s stock­hold­ers.”
Yet for all the talk of change, most com­pa­nies still give pri­or­i­ty to share­hold­er returns, an empha­sis most ana­lysts con­sid­er inevitable. “What’s changed over time is that there’s a view that a lot of cus­tomers care about the envi­ron­ment and care about social issues, and com­pa­nies need to respond to that,” says Steven N. Kaplan, an econ­o­mist at the Uni­ver­si­ty of Chica­go, Mr. Fried­man’s aca­d­e­m­ic home when he pub­lished his essay. “That said, if you do all of that with­out max­i­miz­ing share­hold­er val­ue, you’re going to be uncom­pet­i­tive.” Those forces are dri­ven in by part by the spread of glob­al­iza­tion that inten­si­fied after DuPon­t’s hey­day, says Mr. Kaplan, and can’t be reversed “unless the whole world does it.”

Charles Elson, a Uni­ver­si­ty of Delaware finance pro­fes­sor, agrees. “If you’re account­able to every­one, you’re account­able to no one, and you cre­ate a mess,” he said. “Some would argue that’s where DuPont found itself.”
Mr. Elson made that point to Mr. Biden when the two appeared on a pan­el dis­cus­sion at the uni­ver­si­ty’s new­ly cre­at­ed Biden Insti­tute in 2017 titled “Win-Win: How Tak­ing the Long View Works for Busi­ness and the Mid­dle Class.” Activist share­hold­ers like Mr. Peltz were often “a symp­tom of prob­lem­at­ic man­age­ment,” and gave the econ­o­my its dynamism by using their prof­its “to cre­ate new com­pa­nies, to cre­ate new ideas,” Mr. Elson said.
A skep­ti­cal Mr. Biden replied: “What evi­dence is there of that?”
Delaware itself offers evi­dence of how cap­i­tal and labor can be real­lo­cat­ed from declin­ing to pro­duc­tive sec­tors. As DuPont shrank, Delaware devel­oped a thriv­ing finan­cial sec­tor. A study by the Eco­nom­ic Inno­va­tion Group, a think tank, shows Delaware’s new busi­ness start­up rate out­paces the nation­al aver­age — in part from ven­tures by for­mer DuPont exec­u­tives and sci­en­tists. Over the past three decades, total employ­ment in Delaware has grown about 25%, even as the share of employ­ment from man­u­fac­tur­ers like DuPont has fall­en in half, to about 6%. At the same time, how­ev­er, income growth has slumped, accord­ing to Moody’s Ana­lyt­ics, under­scor­ing the Biden argu­ment that work­ers have lost out from those changes.
Mr. Biden’s father moved his fam­i­ly from strug­gling Scran­ton, Pa., to Delaware in 1953, where he ulti­mate­ly ran a used-car deal­er­ship, attract­ed by pros­per­i­ty attrib­ut­able in good part to DuPont. Found­ed in 1802 as a gun­pow­der mak­er, its prod­ucts such as nylon, Teflon, Fre­on, Lucite, Mylar and Kevlar rev­o­lu­tion­ized con­sumer and com­mer­cial life. At its peak in 1990, DuPont employed 27,000 in Delaware — one of every 10 work­ers.
The com­pa­ny was affec­tion­ate­ly dubbed “Uncle Dupie,” and fam­i­ly mem­bers fund­ed schools and hos­pi­tals, ran dozens of char­i­ta­ble foun­da­tions, made up their own bloc of law­mak­ers in the state leg­is­la­ture and peri­od­i­cal­ly were elect­ed gov­er­nor. It built and ran a coun­try club for employ­ees, and a the­ater and hotel for Wilm­ing­ton.

NOTE: Here is anoth­er good arti­cle on Delaware and it’s fishy cor­po­ra­tions, Duponts role in that sit­u­a­tion, and Biden’s gen­er­al Janus-faced atti­tudes towards cor­po­rate Amer­i­ca.

https://www.motherjones.com/politics/2019/11/biden-bankruptcy-president/

…In ear­ly 1973, as Joe Biden was set­tling into his new job in Wash­ing­ton, DC, Ralph Nad­er pub­lished a decon­struc­tion of what made the fresh­man Demo­c­ra­t­ic senator’s state of Delaware, the most ano­dyne of states, so excep­tion­al. The answer, The Com­pa­ny State explained, had to do with the unique rela­tion­ship between gov­ern­ment and com­merce: Delaware was less a democ­ra­cy than a fief­dom, con­tort­ing its laws to meet the demands of its cor­po­rate lords.
Pre­em­i­nent among them was the chem­i­cal giant DuPont. Nad­er took read­ers to Rod­ney Square, in the heart of Wilm­ing­ton. There was the ritzy Hotel du Pont, housed in a build­ing owned by DuPont, next to a the­ater built by DuPont, con­nect­ed to a bank con­trolled by the du Pont fam­i­ly, sur­round­ed by law offices and brokerages—all affil­i­at­ed in some way with what was known sim­ply as “The Com­pa­ny.” The du Ponts owned the state’s two largest news­pa­pers and employed a tenth of the state leg­is­la­ture. The gov­er­nor was a for­mer exec­u­tive. The state’s mem­ber of Con­gress for most of the 1970s was Pierre Samuel du Pont IV.
“Gen­er­al Motors could buy Delaware,” Nad­er quipped, “if DuPont were will­ing to sell it.”
Over the next two decades, as Biden rose through the ranks of the Demo­c­ra­t­ic Par­ty, the state’s cen­ter of grav­i­ty began to shift from the world of chem­i­cals to the big busi­ness of oth­er people’s business—banking, account­ing, law, and tele­mar­ket­ing. But if the indus­try had changed, the ethos remained: Delaware was the Com­pa­ny State. It owed its pros­per­i­ty to its will­ing­ness to give cor­po­ra­tions what they want­ed.
Though he’s now a mil­lion­aire thanks to book sales and speak­ing fees, Biden has long posi­tioned him­self as the cham­pi­on of the mid­dle class, a scrap­py kid from Scran­ton who’s fought the good fight for decades. His adopt­ed home state is part of that iden­ti­ty too—an unglam­orous enclave of scrap­ple and toll roads, the Acela Corridor’s own Fly­over Coun­try. But as he pur­sues his third and like­ly final quest for the Demo­c­ra­t­ic pres­i­den­tial nom­i­na­tion, his record haunts him, because the inter­ests of Delaware are often at extreme odds with every­one else’s.
Biden did not cre­ate this sys­tem, but he used his influ­ence to strength­en and pro­tect it. He cast key votes that dereg­u­lat­ed the bank­ing indus­try, made it hard­er for indi­vid­u­als to escape their cred­it card debts and stu­dent loans, and pro­tect­ed his state’s sta­tus as a cor­po­rate bank­rupt­cy hub.
Biden’s career in the Sen­ate placed him on the wrong side of some of the biggest finan­cial fights of his gen­er­a­tion and brought him into con­flict with some of the same rivals he faces today. If you want to under­stand how Biden became Biden, you have to under­stand how Delaware became Delaware
Delaware is a tiny state, and because it is tiny, it has had to get cre­ative to sur­vive. Small coun­tries sell ship­ping rights, cit­i­zen­ship, and secre­cy. Delaware offers an Amer­i­can vari­a­tion of the same—a legal and admin­is­tra­tive sanc­tu­ary that allows busi­ness­es to do things there that they could not do else­where.
The foun­da­tion for the state’s econ­o­my began with its 1776 con­sti­tu­tion, which cre­at­ed a spe­cial venue for the han­dling of busi­ness dis­putes, called the chancery court. But Delaware’s role as America’s cor­po­rate epi­cen­ter traces back to 1899, when—with the back­ing of the du Ponts—legislators passed the Gen­er­al Cor­po­ra­tion Law, allow­ing any­one in the Unit­ed States who want­ed to form a com­pa­ny in Delaware to do so. The num­ber of cor­po­ra­tions based in the state grew quick­ly, and when New Jersey—the OG of lax incor­po­ra­tion laws—decided to crack down on trusts, Delaware wel­comed the exiles.
The incor­po­ra­tion law made it easy to set up shop in Delaware, and the chancery court made it con­ve­nient to stay. Com­pa­nies knew they’d get a reli­able pro-busi­ness forum for their dis­putes. Today, there are near­ly twice as many Delaware-incor­po­rat­ed com­pa­nies as there are Delaware vot­ers, and incor­po­ra­tion fees con­sti­tute the sec­ond-largest share of the state’s annu­al rev­enue.
But Delaware’s wind­fall comes at the expense of oth­er states. Cor­po­ra­tions can place their prof­its in Delaware-based hold­ing com­pa­nies to avoid pay­ing tax­es in the places where they actu­al­ly oper­ate. Delaware LLCs can also be incor­po­rat­ed anony­mous­ly via third-par­ty agents, sti­fling trans­paren­cy. “Set­ting up a com­pa­ny in Delaware,” the Insti­tute on Tax­a­tion and Eco­nom­ic Pol­i­cy says, “requires less infor­ma­tion than sign­ing up for a library card.”
When the econ­o­my sagged in the late 1970s, the cash-strapped state began look­ing for ways to sup­ple­ment its income. In 1981, it passed a new law, writ­ten by bank­ing lob­by­ists and backed by DuPont, with the hopes of becom­ing, in the words of the gov­er­nor who signed it (a du Pont, nat­u­ral­ly), “the Lux­em­bourg of the Unit­ed States.” While oth­er states were set­ting caps on usury rates, Delaware told banks they could charge what­ev­er they want­ed in annu­al inter­est and late fees; the banks could also fore­close on debtors’ homes if they fell behind on pay­ments. The state even cut cor­po­rate tax­es.
The result was a cor­po­rate gold rush. A dozen com­pa­nies, includ­ing JP Mor­gan and Chase Man­hat­tan (now JP Mor­gan Chase), opened offices in Delaware in the first year alone. By the late ’90s, four of the five largest cred­it card firms in the coun­try had set up in Wilm­ing­ton, and the indus­try employed at least 35,000 peo­ple. The Com­pa­ny State had pulled off a lucra­tive turnaround.Justin Metz; Shut­ter­stock
The state’s deci­sion to turn itself into New Lux­em­bourg ush­ered in an era of eco­nom­ic pros­per­i­ty that coin­cid­ed with a polit­i­cal era of good feel­ings. The reboot­ed Delaware was emblem­at­ic of the kind of gauzy comi­ty that Biden has some­times got­ten in trou­ble for wax­ing nos­tal­gic about. Elect­ed offi­cials from both par­ties prid­ed them­selves on what they called “the Delaware Way”—a will­ing­ness to put aside par­ti­san­ship for the good of the state, which invari­ably meant aid­ing its busi­ness cli­mate. Rev­enue from cor­po­rate tax­es and LLCs kept gov­ern­ment cof­fers full, and the state’s low income tax rates kept vot­ers hap­py.
For decades, much of the front-line work of cham­pi­oning the state’s indus­try in Wash­ing­ton was han­dled by the state’s senior sen­a­tor, Repub­li­can William Roth, a Sen­ate Finance Com­mit­tee mem­ber so absorbed in such mat­ters that there’s a tax-free retire­ment account named for him. But Biden did his part too.
A let­ter I found in Roth’s Sen­ate papers at the Delaware His­tor­i­cal Soci­ety offered a glimpse of how close­ly banks worked with the state’s del­e­ga­tion. In 1998, an exec­u­tive at First USA, a cred­it card com­pa­ny based in Wilm­ing­ton, wrote to Roth, ask­ing him to inter­vene on a pro­posed rule that would short­en the win­dow in which cred­it card com­pa­nies could col­lect debts from debtors. A few days lat­er, Roth, Biden, and a Delaware rep­re­sen­ta­tive did just that. “Reduc­ing the col­lec­tions peri­od for cred­it card debt by one-sixth would have a direct effect on Delaware banks,” the law­mak­ers wrote to fed­er­al reg­u­la­tors. “Many Delaware bankers are con­cerned that such a change would unfair­ly result in sub­stan­tial loss­es to their insti­tu­tions.”
Through­out the 1980s and ’90s, as Biden set­tled into a com­fort­able incum­ben­cy, banks sought to make the rest of the coun­try work more like their mid-Atlantic refuge—to embrace the least pos­si­ble amount of reg­u­la­tion so they could grow as big as they want­ed. Delaware, for instance, had a loop­hole allow­ing banks to sell insur­ance. Now the banks want­ed to do that every­where. Delaware’s laws made it easy for cred­it card com­pa­nies to do busi­ness in any states they pleased. Finan­cial firms want­ed reg­u­lar deposit banks to have that abil­i­ty too.
Biden sup­port­ed a baby-step dereg­u­la­to­ry effort in the ear­ly 1980s, and then, in 1994, he backed a very big one: the Riegle-Neal Inter­state Bank­ing and Branch­ing Effi­cien­cy Act, which elim­i­nat­ed the remain­ing bar­ri­ers to where banks could oper­ate. The law passed with over­whelm­ing bipar­ti­san sup­port and was fair­ly innocu­ous in some respects, cod­i­fy­ing changes that were already hap­pen­ing at the state lev­el. But it opened the flood­gates to an era of cor­po­rate con­sol­i­da­tion. Delaware’s finan­cial insti­tu­tions got anoth­er big boost in 1999, when Biden vot­ed for the Finan­cial Ser­vices Mod­ern­iza­tion Act, which repealed the Depres­sion-era Glass-Stea­gall law bar­ring banks from own­ing secu­ri­ties and insur­ance busi­ness­es. By 2016, there were almost 5,000 few­er banks in the Unit­ed States than there were two decades ear­li­er, and the 10 largest firms con­trolled half of all bank­ing assets.
The metas­ta­sis of America’s finan­cial con­glom­er­ates proved cat­a­stroph­ic when those increas­ing­ly huge banks began to pack­age sub­prime mort­gages as secu­ri­ties a few years lat­er. (Biden, for his part, opposed the 2000 law that dereg­u­lat­ed deriv­a­tives.) Dur­ing the 2008 cam­paign, even after Biden had been added to the pres­i­den­tial tick­et, Barack Oba­ma cit­ed Glass-Steagall’s repeal as a step­ping stone to the finan­cial col­lapse. Recent­ly, Biden has been apolo­getic, if some­what cryp­tic, about that vote. “I’ll be blunt with you: The only vote I can think of that I’ve ever cast in my years in the Sen­ate that I regret—and I did it out of loy­al­ty, and I wasn’t aware that it was gonna be as bad as it was—was Glass-Stea­gall,” he told the New York­er in 2014.
Even when Biden was nom­i­nal­ly buck­ing his state’s busi­ness inter­ests, he did it gen­tly. In 1991, to the hor­ror of Delaware com­pa­nies, he sup­port­ed amend­ing a bank­ing reg­u­la­tion bill to impose a nation­wide cap on cred­it card inter­est rates. He explained that he had vot­ed for the amend­ment only because he con­sid­ered it a poi­son pill that would force the Sen­ate to pass much nar­row­er leg­is­la­tion. It worked.
But the most con­tro­ver­sial item on the banks’ agen­da, and the one that would require the most leg­work from Biden, was bank­rupt­cy reform.
Late in Biden’s 1996 reelec­tion cam­paign, a con­sul­tant work­ing for his Repub­li­can oppo­nent pushed a trou­bling sto­ry: The sen­a­tor had sold his home to an exec­u­tive from the cred­it card com­pa­ny MBNA for dou­ble its appraised val­ue. MBNA called the sto­ry “vicious­ly false,” and Biden pushed back hard enough that his oppo­nent fired the con­sul­tant. True, he had sold his house to an MBNA executive—but at its appraised val­ue. Not long after that, though, the com­pa­ny hired Biden’s youngest son, Hunter, and the crit­i­cism stuck: Biden became, to his detrac­tors, “the sen­a­tor from MBNA.” (Hunter’s cor­po­rate affil­i­a­tions have once again become an issue for Biden. His son’s role on the board of a Ukrain­ian ener­gy com­pa­ny while Biden over­saw the Oba­ma administration’s Ukraine pol­i­cy has fueled cor­rup­tion accu­sa­tions and con­spir­a­cy-mon­ger­ing by Repub­li­can crit­ics; Don­ald Trump’s effort to force Ukraine to inves­ti­gate the Bidens is now at the cen­ter of the impeach­ment inquiry.)
MBNA, the largest inde­pen­dent cred­it card com­pa­ny head­quar­tered in Delaware, hard­ly drew notice at first. In 1982, five employ­ees from a com­pa­ny called Mary­land Bank set up shop in an old super­mar­ket a few miles from the state line. They hit upon the idea of pitch­ing cred­it cards to tar­get­ed groups—like sports fans or col­lege students—and did a quar­ter of a bil­lion dol­lars of busi­ness in just over a year. By 1997, MBNA was mail­ing 30 mil­lion cred­it card solic­i­ta­tions a month and mak­ing 6 mil­lion over the phone. Get­ting peo­ple into debt was how the com­pa­ny prof­it­ed, and it was self-per­pet­u­at­ing. If a debtor missed a car pay­ment to pay a cred­it card on time, MBNA would raise the person’s inter­est rate any­way, a prac­tice known as uni­ver­sal default—thereby increas­ing the like­li­hood the per­son would miss future pay­ments.
Because MBNA did all of its work in-house—even tele­mar­ket­ing and cus­tomer service—its Wilm­ing­ton-based pay­roll dwarfed rival firms’. MBNA employed about a third of the state’s finance work­ers. The com­pa­ny stock­piled vin­tage cars (a Due­sen­berg was parked in its lob­by) and began buy­ing up old DuPont properties—office build­ings and golf courses—and slap­ping its logo on new and ren­o­vat­ed build­ings over­look­ing Rod­ney Square. When, in the ear­ly 2000s, the chancery court relo­cat­ed to a big­ger build­ing, MBNA bought the old one.
MBNA brought the same largesse to pol­i­tics. It shelled out near­ly $1 mil­lion in dona­tions to fed­er­al can­di­dates in 1994, the same year an array of pro-busi­ness Repub­li­cans took con­trol of Con­gress. These dona­tions came from indi­vid­ual employ­ees, not the cor­po­rate trea­sury, but the Wil­mington News Jour­nal obtained an inter­nal memo from the bank’s chief coun­sel direct­ing 150 MBNA execs on whom they should con­tribute to, even ask­ing them to send pho­to­copies of their checks.
Most of the mon­ey flowed to Republicans—MBNA employ­ees were George W. Bush’s largest con­trib­u­tor dur­ing his 2000 pres­i­den­tial campaign—but Biden was an excep­tion. He brought in more than $200,000 from MBNA employ­ees over the course of his career. And he devel­oped a rela­tion­ship with the company’s CEO, Charles Caw­ley. When Biden held a Wilm­ing­ton fundrais­er for his 1996 cam­paign, Caw­ley was there. When Caw­ley received an award for his char­i­ta­ble giv­ing, Biden and Bush appeared onstage with him. A cou­ple years lat­er, Caw­ley co-chaired an award cer­e­mo­ny for Biden. On the company’s dime, Biden and his wife, Jill, flew to Maine, where the sen­a­tor spoke at MBNA’S 1997 cor­po­rate retreat.
MBNA lob­bied for the repeal of Glass-­Stea­gall, accord­ing to the News Jour­nal, and because MBNA’S busi­ness mod­el was based on delin­quent cus­tomers, it lob­bied to block reforms meant to help cash-strapped con­sumers, such as cred­it­ing bill pay­ments to the day they are mailed rather than the day they are received. But what it was real­ly after was bank­rupt­cy reform.
Between 1980 and 1997, the num­ber of Amer­i­cans fil­ing for per­son­al bank­rupt­cy jumped more than 300 per­cent, affect­ing 1.3 mil­lion house­holds annu­al­ly. A grow­ing num­ber of researchers, led by a Har­vard Law School pro­fes­sor named Eliz­a­beth War­ren, believed the fault lay with the accu­mu­lat­ing cred­it card fees, hos­pi­tal bills, stu­dent loans, and mort­gages that were plac­ing the squeeze on mid­dle-class fam­i­lies. Their research found that, for debtors, per­son­al bank­rupt­cy was not an escape hatch; it was a life­line.
A con­gres­sion­al effort to curb bank­rupt­cies might have start­ed with look­ing at how peo­ple were get­ting into debt. Instead, Con­gress tack­led the prob­lem from the per­spec­tive of the cred­i­tors, who argued that stricter rules were nec­es­sary to fore­stall abus­es of the sys­tem and pre­vent bil­lions of dol­lars in loss­es from trick­ling down to con­sumers. In 1997, a group of House law­mak­ers began craft­ing a bill that would make it hard­er for indi­vid­u­als to file for bank­rupt­cy by sub­ject­ing fil­ers to a means test and giv­ing cred­i­tors more oppor­tu­ni­ties to col­lect. The cred­it card com­pa­nies loved it. After all, they wrote large chunks of the leg­is­la­tion.
Biden vot­ed to make the bill more mod­er­ate, and it died. Then he sup­port­ed an altered ver­sion intro­duced in the next Con­gress. Bank­rupt­cy reform would go through the judi­cia­ry com­mit­tee that Biden sat on and had once chaired, and, in the words of one lob­by­ist, he was the “linch­pin” of the effort to pass it.
Cred­it card com­pa­nies want­ed to lim­it the options of peo­ple fil­ing for per­son­al bank­rupt­cy, but that was only one part of the equa­tion. Delaware also had a lot rid­ing on help­ing cor­po­ra­tions file for bank­rupt­cy. For a vari­ety of rea­sons, includ­ing its high con­cen­tra­tion of white-col­lar lawyers and the pro-busi­ness rep­u­ta­tion of its courts, the state was the venue for a large per­cent­age of the nation’s Chap­ter 11 cas­es. It had even come up with a spe­cial fast-tracked bank­rupt­cy process. Fil­ing in Delaware allowed com­pa­nies that were func­tion­al­ly based else­where to “escape the oblig­a­tion to make the process open,” as War­ren put it.
Bank­rupt­cy cas­es made huge gobs of mon­ey for Delaware’s legal indus­try. When reform­ers intro­duced lan­guage that would force com­pa­nies to file for bank­rupt­cy in the states where they were actu­al­ly based—a clause dubbed “the Delaware killer”—Biden used his lever­age to defeat it. Ulti­mate­ly, Biden end­ed up secur­ing fund­ing for four more bank­rupt­cy judges in Delaware.
In 2002, Eliz­a­beth War­ren called out Biden for his “ener­getic work on behalf of the cred­it card com­pa­nies.”
Over time, Biden’s exer­tions on the bank­rupt­cy bill began to shape his nation­al rep­u­ta­tion. “His ener­getic work on behalf of the cred­it card com­pa­nies has earned him the affec­tion of the bank­ing indus­try and pro­tect­ed him from any well-fund­ed chal­lengers for his Sen­ate seat,” War­ren wrote in the Har­vard Women’s Law Jour­nal. “This impor­tant part of Sen­a­tor Biden’s leg­isla­tive work also appears to be miss­ing from his Web site and pub­lic­i­ty releas­es.”
Warren’s crit­i­cism of Biden came to a head at a Capi­tol Hill hear­ing in 2005, when they sparred over the bank­rupt­cy bill for 15 min­utes. Biden appeared exas­per­at­ed with the expert wit­ness sit­ting across from him. He found it “out­ra­geous” that she would ques­tion the open­ness of Delaware’s bank­rupt­cy court to small cred­i­tors, and he insist­ed that War­ren was aim­ing at the wrong tar­get. Her focus should be on big struc­tur­al issues like health care and lend­ing prac­tices, he insist­ed, rather than the par­tic­u­lars of the bill he was push­ing:
Biden: Maybe we should talk about usury rates, then. Maybe that is what we should be talk­ing about, not bank­rupt­cy.
War­ren: Sen­a­tor, I will be the first. Invite me.
Biden: I know you will, but let’s call a spade a spade. Your prob­lem with cred­it card com­pa­nies is usury rates, from your posi­tion. It is not about the bank­rupt­cy bill.
War­ren: But, Sen­a­tor, if you are not going to fix that prob­lem, you can’t take away the last shred of pro­tec­tion from these fam­i­lies.
Biden: I got it, okay. You are very good, pro­fes­sor.
Biden takes crit­i­cism of his bank­rupt­cy posi­tion per­son­al­ly, in part because it infringes so direct­ly on his well-cul­ti­vat­ed polit­i­cal identity—a mid­dle-class war­rior and long­time crit­ic of cor­po­rate cam­paign con­tri­bu­tions. In a floor speech just before the bank­rupt­cy bill’s pas­sage, he accused its oppo­nents of “fab­ri­cat­ing wild claims” such as the charge that the bill would make it hard­er for women to col­lect child sup­port pay­ments from insol­vent ex-hus­bands. The bill did include pro­tec­tions for the col­lec­tion of alimo­ny and child support—pushed by Biden and endorsed by the Nation­al Child Sup­port Enforce­ment Association—which moved those debts to the top of the peck­ing order (above cred­it card bills) in bank­rupt­cy pro­ceed­ings. In the­o­ry, this would save sin­gle par­ents and ex-spous­es from hav­ing to hound dead­beat exes in court. But the crit­i­cisms weren’t unfound­ed either—by increas­ing the amount of mon­ey that com­pa­nies with liens could skim off the top pri­or to bank­rupt­cy, it shrank the over­all pot of mon­ey to col­lect from. Hen­ry Som­mer, pres­i­dent of the Nation­al Con­sumer Bank­rupt­cy Rights Cen­ter, says the idea that Biden stood up for sin­gle moth­ers is “kind of a hoax.”
“Vice Pres­i­dent Biden has cham­pi­oned the mid­dle class for his entire career and has a proven track record of deliv­er­ing on his pro­gres­sive val­ues,” his spokesper­son Michael Gwin said in a state­ment in response to ques­tions about the bill. “As a Sen­a­tor, Joe Biden fought to secure crit­i­cal con­ces­sions for work­ing fam­i­lies in the bank­rupt­cy bill.” Biden did advo­cate for oth­er improve­ments that made it into the bill’s final ver­sion, such as new dis­clo­sure require­ments for cred­it card solic­i­ta­tions. The means test at the heart of the law came with a “safe har­bor” pro­vi­sion that exempt­ed fil­ers who made less than their state’s medi­an income. And Biden sup­port­ed a cap on how much mon­ey a rich debtor could shield from cred­i­tors in the form of real estate.
When the New York Times Mag­a­zine asked Biden about bank­rupt­cy reform in July, he was defi­ant. Con­tri­bu­tions from banks didn’t mat­ter to him, he said, because “MBNA could not beat me.” He had worked on bank­rupt­cy reform, he explained, because he knew it was going to pass and he believed he had an oblig­a­tion to use his influ­ence to make it more con­sumer-friend­ly. “I had an oppor­tu­ni­ty to do one of two things: Vote no, and feel real good about it, or I could make it bet­ter.”
But the reform move­ment was hard­ly a steam­roller. It took five suc­ces­sive Congress­es, and a new pres­i­dent, to final­ly pass the bill in 2005. Plen­ty of Democ­rats in Wash­ing­ton, includ­ing then-Sen. Barack Oba­ma, opposed it. Biden’s sup­port was instru­men­tal, and he was deeply invest­ed in its suc­cess. “If they don’t [pass it], to hell with them,” he report­ed­ly said of his col­leagues in 2002, after the bill stalled yet again. Those weren’t the words of a per­son who was sim­ply along for the ride. Biden joined a small group of Democ­rats rep­re­sent­ing major cred­it card states to vote with a unit­ed Repub­li­can bloc against Demo­c­ra­t­ic amend­ments aimed at mod­er­at­ing the bill’s pro-cred­i­tor slant.
No one I spoke with who opposed the bill con­sid­ered Biden sym­pa­thet­ic to their side. Gary Klein, a for­mer senior attor­ney at the Nation­al Con­sumer Law Cen­ter, which had helped coor­di­nate oppo­si­tion to the bill, told me his coali­tion nev­er even got a meet­ing with the sen­a­tor or his staff despite repeat­ed requests.
The bank­rupt­cy bill did not, in ret­ro­spect, turn into the total cat­a­stro­phe that its oppo­nents had feared. Sen­a­tors intro­duced enough changes that the final ver­sion includ­ed pro­tec­tions for cer­tain kinds of debtors from cer­tain kinds of cred­i­tors. “I think over time that some of the bal­ance we got into the bill has proven effec­tive at allow­ing peo­ple who need the sys­tem to get the relief that they need,” Klein said. But, he added, “I still don’t think it was a good bill.”
A 2008 study pub­lished in the Amer­i­can Bank­rupt­cy Law Jour­nal found that “cred­it card com­pa­nies saved bil­lions because of reduced loan loss rates,” but that none of those sav­ings ben­e­fit­ed con­sumers. Because inter­est rates and late fees con­tin­ued to tick upward, “the cost to cred­it card cus­tomers increased 5% to 17%.” And even before the reces­sion hit, Cred­it Suisse found that the bank­rupt­cy law had “a pro­found impact on sub­prime bor­row­ers” and made it more like­ly that bor­row­ers would fail on their bank­rupt­cy pay­ment plans. “Before that law was passed you could file a chap­ter 7 bank­rupt­cy for sev­en, eight, nine-hun­dred dol­lars, includ­ing attorney’s fees and fil­ing fees, and that’s gone up to more like $2,000,” Som­mer said. “It’s made bank­rupt­cy much more expen­sive, dif­fi­cult, bur­den­some, and less effec­tive.” The num­ber of per­son­al bank­rupt­cy fil­ings has fall­en by half in 15 years.
“Biden’s bank­ing votes have stuck with him because their effects have stuck with us.”
Biden’s bank­ing votes have stuck with him because their effects have stuck with us. You could draw a rea­son­ably straight line from the bank dereg­u­la­tion votes of the ’90s to “too big to fail,” the hous­ing cri­sis, and the Great Reces­sion. And plen­ty of Democ­rats do. Biden now finds him­self locked in a tough pres­i­den­tial pri­ma­ry with War­ren her­self, who forged her polit­i­cal iden­ti­ty by clash­ing with the kinds of mega­banks Biden had a hand in cre­at­ing. At an event in Iowa this spring, War­ren used the bank­rupt­cy show­down as a point of con­trast between her­self and the Demo­c­ra­t­ic fron­trun­ner. “I got in that fight because [fam­i­lies] just didn’t have any­one and Joe Biden was on the side of the cred­it card com­pa­nies,” she said. “It’s all a mat­ter of pub­lic record.”
Sen. Bernie Sanders, anoth­er crit­ic of Biden’s bank­ing votes, some­times asks audi­ences to rat­tle off their stu­dent loan debts. But Biden, whose state is home to stu­dent lenders like Sal­lie Mae and Navient, cast vote after vote to make stu­dent loan debt as hard to escape as cred­it card debt. Sanders has pushed to cap cred­it card inter­est rates at 15 per­cent and called for the return of Glass-Stea­gall, whose repeal, he warned in 1999, would put tax­pay­ers on the hook “should a finan­cial con­glom­er­ate fail.” In August, he pro­posed can­cel­ing all of Amer­i­cans’ over­due med­ical debt (about $81 bil­lion) and repeal­ing por­tions of the bank­rupt­cy law, which his cam­paign said “elim­i­nat­ed fun­da­men­tal con­sumer pro­tec­tions.”
In 2008, the New York Times report­ed that Oba­ma aides con­sid­ered MBNA “one of the most sen­si­tive issues they exam­ined while vet­ting [Biden] for a spot on the tick­et.” Biden’s pro­gres­sive crit­ics still har­bor those con­cerns. “We saw in 2016 that there were too many peo­ple who bought Don­ald Trump’s fake pop­ulism where he pre­tend­ed to bash Wall Street and pre­tend­ed that he would clean up cor­po­rate cor­rup­tion and polit­i­cal cor­rup­tion,” Adam Green, co-founder of the War­ren-back­ing Pro­gres­sive Change Cam­paign Com­mit­tee, said. “We can’t blur the waters on that again. We need to have some­one who vot­ers instinc­tive­ly see as on their side and will­ing to chal­lenge entrenched inter­ests.” The eco­nom­ic sys­tem War­ren and Sanders are run­ning against is the one that Biden helped export from his state to the rest of the nation.
Like most of the insti­tu­tions that call Delaware home, Joe Biden now does much of his work some­where else. His cam­paign is head­quar­tered in Philadel­phia. His cam­paign kick­off was in Pitts­burgh. His stump-speech lodestar is Scran­ton. But if its elder states­man has moved on, Delaware hasn’t.
One after­noon in July, I strolled from the Joseph R. Biden Jr. Rail­road Sta­tion in down­town Wilm­ing­ton and walked through the leafy JP Mor­gan Chase cam­pus to the gleam­ing new Delaware Chancery Court. A few blocks north, the Hotel du Pont still stands, flanked by the 18-sto­ry Cit­i­zens Bank and a high-rise that until recent­ly was owned by Bank of Amer­i­ca, which pur­chased MBNA for $35 bil­lion in 2006. The old chancery court has a new ten­ant too—the state’s largest bank­rupt­cy law prac­tice. The names may change, but the Com­pa­ny State is eter­nal.
On my way back to the sta­tion, I stopped at the Delaware His­to­ry Muse­um, a tidy space that opened its doors in a ren­o­vat­ed Wool­worth in 1995 amid a boom in down­town con­struc­tion. There, along­side arti­facts from DuPont’s labs and a T‑shirt from the Punkin Chunkin Fes­ti­val, was an entire exhib­it on the mod­ern Delaware econ­o­my. A black-and-white pho­to depict­ed the super­mar­ket where MBNA opened its first office. Accom­pa­ny­ing text help­ful­ly explained how the 1981 Finan­cial Cen­ter Devel­op­ment Act removed “the cap on the inter­est rates that banks could charge on cred­it cards…further diver­si­fy­ing the state’s econ­o­my.” Wall pan­els, at kid-lev­el, invit­ed vis­i­tors to guess the iden­ti­ty of Delaware-incor­po­rat­ed com­pa­nies based on short descrip­tions like “This company’s mas­cot is a charm­ing green Gecko with a Cock­ney accent who turns up every­where in tele­vi­sion com­mer­cials.”
I wan­dered out to the gift shop, where I found the best­selling item perched on a shelf along the back wall. “Your long search is final­ly over,” a sign said. “You have acquired a Joe Biden scent­ed can­dle.” It cost $22 and smelled like oranges. Before you ask, yes, they take cred­it for it.

NOTE: This is the house Biden bought from the Duponts. Leave it to that moron Eric Trump to mud­dy the waters.

https://www.housebeautiful.com/design-inspiration/a34430021/joe-biden-mansion-greenville-wilmington-delaware-dupont-nemours/
Over the week­end, Eric Trump, son of Pres­i­dent Trump, tweet­ed a pho­to that shows an aer­i­al view of an expan­sive abode, along with the cap­tion “The salary of a U.S. Sen­a­tor is $174,000 per year. This is Joe Biden’s house.... seems legit 🙄.” As many were quick to point out, Joe Biden sold this prop­er­ty back in 1996, so he hasn’t lived in this home in 24 years—and, although the Greenville, Delaware man­sion looks grand, it didn’t look exact­ly like that when Biden pur­chased it. Thanks to two decades worth of restora­tion work, Biden trans­formed this once-aban­doned man­sion (for which he paid just $185,000 back in 1974) into a sprawl­ing prop­er­ty that he went on to sell for $1.2 mil­lion in 1996. That means Biden sold the home for just over $1 mil­lion more than the price he orig­i­nal­ly paid for it. Pret­ty impres­sive, right? Below, House Beau­ti­ful delves into the his­to­ry of this prop­er­ty, includ­ing its ties to anoth­er, more well-known near­by man­sion.
Long before Biden’s for­mer man­sion came into his pos­ses­sion, it orig­i­nal­ly belonged to the du Ponts,a promi­nent fam­i­ly who set­tled in Wilm­ing­ton, Delaware and made bil­lions off of their gun­pow­der busi­ness, E. I. du Pont de Nemours and Com­pa­ny (which now goes by the name DuPont). In fact, you may have heard of (or vis­it­ed!) one of their oth­er for­mer homes in the area: the Nemours Estate, which opened to the pub­lic in 1977 and con­sists of 300 acres of lush land­scapes, and a château-style man­sion that boasts 105 rooms across 47,000 square feet

NOTE: The biggest crit­i­cism from envi­ron­men­tal groups sur­rounds Biden’s selec­tion of Michael McCabe to run his EPA tran­si­tion team.

https://www.independent.co.uk/news/world/americas/us-politics/erin-brockovich-biden-epa-dupont-b1759420.html

Erin Brock­ovich, an envi­ron­men­tal advo­cate, has penned an edi­to­r­i­al crit­i­cis­ing Joe Biden for con­sid­er­ing a chem­i­cal indus­try insid­er for his Envi­ron­men­tal Pro­tec­tion Agency tran­si­tion team. Ms Brock­ovich rose to promi­nence after cham­pi­oning suc­cess­ful legal bat­tles against major cor­po­ra­tions pol­lut­ing the envi­ron­ment. A movie based on her legal bat­tles star­ring Julia Roberts was released in 2000.
In an edi­to­r­i­al for The Guardian, Ms Brock­ovich said she was frus­trat­ed with one of Mr Biden’s picks for his EPA tran­si­tion team, Michael McCabe.
She said Mr McCabe was a for­mer employ­ee of Mr Biden and deputy at the EPA before leav­ing to enter the pri­vate sec­tor and work in com­mu­ni­ca­tions for DuPont, a chem­i­cal com­pa­ny that has been crit­i­cised for its con­nec­tion to chem­i­cals that have led to birth defects and ill­ness­es in those exposed to them.
 
Ms Brock­ovich specif­i­cal­ly point­ed to DuPon­t’s fight against reg­u­la­tions on a chem­i­cal called per­flu­o­rooc­tanoic acid.
“The tox­ic man­made chem­i­cal is used in every­thing from water­proof clothes, stain-resis­tant tex­tiles and food pack­ag­ing to non-stick pans. The com­pound has been linked to low­ered fer­til­i­ty, can­cer and liv­er dam­age,” she wrote.
She said she felt that Mr Biden was con­sid­er­ing the same kinds of indus­try insid­ers who would be open to out­side influ­ence that Mr Trump select­ed for his admin­is­tra­tion.
“This smells of the dawn of the same old. To quote The Who: meet the new boss, same as the old boss,” she wrote. “It should go with­out say­ing that some­one who advised DuPont on how to avoid reg­u­la­tions is not some­one we want advis­ing this new admin­is­tra­tion.”

She claimed that Mr McCabe’s work for DuPont would have “inevitably con­tributed to staving off cost­ly clean-up and addi­tion­al reg­u­la­tion headaches for the com­pa­ny.”
“Are we already falling back on the old and anti­quat­ed, hide-and-seek, con­ceal, dodge and deny lead­er­ship or are you going to come out and be the change and the hope need­ed when it comes to the envi­ron­ment?” she wrote.
She called on Mr Biden to “keep your promise” and to “give the peo­ple a voice and a seat at the table” to find solu­tions to envi­ron­men­tal issues.
“We are in this mess because we con­tin­ue to do the same old thing,” she con­clud­ed.

Some lib­er­als on Twit­ter were quick to chas­tise Ms Brock­ovich, com­plain­ing that she should not be crit­i­cis­ing Mr Biden in the midst of the elec­tion chal­lenge posed by Don­ald Trump.

“We want Erin B to be bet­ter, not so sure she can be. Bet­ter DuPont be with us than against us, that you don’t get THIS is STUNNING!” one user wrote.

Anoth­er said she was com­par­ing “apples to oranges” and sug­gest­ed Mr Biden had to find some­one in the “mid­dle to guide.”

Jor­dan Uhl, a pro­gres­sive activist, point­ed out the irony of crit­ics telling Ms Brock­ovich to be hap­py to have chem­i­cal com­pa­nies in league with the pres­i­dent-elect.
“How obliv­i­ous do you have to be to tell Erin Brock­ovich that the chem­i­cal com­pa­nies are on ‘our side?’ ” he wrote.

NOTE: One final arti­cle on Dupont in Delaware.

https://www.forbes.com/sites/loracecere/2020/11/30/why-joe-biden-is-wrong-about-uncle-dupey/?sh=4717e4656b8d

For over one hun­dred years, Wilm­ing­ton, Delaware, and DuPont had tight­ly inter­twined his­to­ries. The sto­ry of DuPont is also close­ly imprint­ed in Joe Biden’s views on cor­po­rate over­sight. With­in Wilm­ing­ton, DuPont was called Uncle Dupey.
As Vice Pres­i­dent, Biden watched DuPont strug­gle to dri­ve growth and attempt to thwart an activist share­hold­er. They lost, result­ing in Dupon­t’s merg­er with Dow Chem­i­cal and cut­ting the Delaware work­force by 25%. Biden fre­quent­ly cites the restruc­tur­ing and down­siz­ing of DuPont as mod­ern cap­i­tal­ism gown awry.
Before we get lured to sleep with Biden’s nar­ra­tive, let’s face real­i­ty. Uncle Dupey was a bad guy. He was dis­hon­est, hid­ing some dark and ugly secrets. The patron­iz­ing rela­tion­ship between a wealthy Com­pa­ny and a small town blind­ed the city to the facts. The pol­lut­ed waters—full of a chem­i­cal named “GenX” a pre­cur­sor of Teflon—in the Kanawha Riv­er in West Vir­ginia and the Cape Fear Riv­er in North Car­oli­na will out­last the DuPont name on all of the tall build­ings in down­town Wilm­ing­ton. As Wilm­ing­ton busi­ness lead­ers danced in the DuPont Hotel’s ball­room, the Com­pa­ny was under­per­form­ing the chem­i­cal peer group and lying about haz­ardous waste. Share­hold­er activism was the best thing that could have hap­pened to DuPont.
Wilm­ing­ton, Delaware, is a com­pa­ny town. With DuPont as the largest employ­er, the city enjoyed its ben­e­fits by invest­ing in numer­ous schools, libraries, and the­atres. Hotel DuPont and the DuPont Coun­try Club was the site for cel­e­bra­to­ry par­ties and din­ners.
Many DuPont employ­ees staffed Biden’s first cam­paign. Biden often sin­gled out the DuPont com­pa­ny as a “con­sci­en­tious cor­po­ra­tion” for pay­ing a high­er tax rate.
As shown in Table 1, DuPont, under­per­form­ing against its chem­i­cal peer group, lost its abil­i­ty to com­pete over the last decade. For the peri­od, BASF out­per­formed DuPont. With a sin­gu­lar focus on mar­gin, the Com­pa­ny strug­gled to grow, man­age inven­to­ries, and dri­ve improve­ment. The rea­son? The Com­pa­ny focused on man­u­fac­tur­ing and failed to build a robust sup­ply chain to serve glob­al cus­tomers.
Tri­an, dri­ving the share­hold­er activism suite, lost the ini­tial bat­tle but won the war. The share­hold­er activism result­ed in the spin-off of assets and the merg­er with Dow. Chemours cre­at­ed in 2013 as a spin-off from DuPont, and final­ized in 2015, pro­duces and sells per­for­mance chem­i­cals in three seg­ments: Tita­ni­um Tech­nolo­gies, Flouro­prod­ucts, and deriv­a­tives includ­ing Fre­on, Teflon, Viton, and Kry­tox. The new Com­pa­ny also assumed legal lia­bil­i­ties for the DuPont law­suits.
In 2015, DuPont and Dow merged. In 2017, the two com­pa­nies became a sin­gle enti­ty with the intent to break into three com­pa­nies: Corte­va, Dupont, and Dow. The mar­riage and divorce are now com­plete. The new­er and small­er DuPont makes spe­cial­ty chem­i­cals rang­ing from adhe­sives to bio­ma­te­ri­als. Chemours post­ed rev­enues in 2019 of 6 bil­lion but con­tin­ues to under­per­form the growth and inven­to­ry man­age­ment. The focus con­tin­ues to be on man­u­fac­tur­ing with a focus on cost.
What Lessons Can We Learn From Uncle Dupey?
While I dis­agree with Joe Biden’s take on the lessons to be learned at Uncle Dupey’s knee, I do think that there are some impor­tant facts to con­sid­er:
Good Com­pa­nies Take Care of the Plan­et. When chal­lenged in court, DuPont was not forth­com­ing to own the prob­lem and sug­gest a rem­e­dy for GenX pol­lu­tion. Uncle Dupey sad­dled Chemours with pol­lu­tion legal lia­bil­i­ty com­pli­cat­ing the path for plain­tiff rem­e­dy.
Merg­ers Need To Be Addi­tive. DuPon­t’s pur­chase of Iowa-based Pio­neer Hi-Bred in 1999 was an attempt to diver­si­fy. Agri­cul­ture was a bridge too far for the chem­i­cal busi­ness. There were just too few syn­er­gies between the chem­i­cal and agri­cul­ture busi­ness. The arro­gance of the DuPont exec­u­tives stilt­ed Pioneer’s chances for suc­cess.
Man­u­fac­tur­ing Is Impor­tant, But Not Suf­fi­cient. DuPont prides itself on run­ning and oper­at­ing the world’s most chal­leng­ing man­u­fac­tur­ing facil­i­ties. And, they are good at this mis­sion. With a strong focus on cost and safe­ty, the Com­pa­ny’s man­u­fac­tur­ing cul­ture strug­gled to inno­vate and dri­ve new busi­ness mod­els. The lead­er­ship team failed to embrace diver­si­ty and new ways of work­ing. The Com­pa­ny’s focus on IT stan­dard­iza­tion also sti­fled inno­va­tion.
Peo­ple As An Asset. Iron­i­cal­ly, while the Com­pa­ny offered lucra­tive ben­e­fits, in my work with over 800 com­pa­nies, I have nev­er worked with groups of peo­ple as dis­en­fran­chised as the DuPont teams. In the last year, work­ers were rid­ing the wave-after-wave of change to qual­i­fy for retire­ment ben­e­fits. The bureau­crat­ic envi­ron­ment smoth­ered cre­ativ­i­ty.
A Fine Line Between Cor­po­rate Greed and Altru­ism. To the peo­ple of Wilm­ing­ton, Uncle Dupey was a great and rich uncle. The com­mu­ni­ties of Delaware rode Uncle Dupey’s coat­tails for pros­per­i­ty. The salaries of DuPont exec­u­tives and DuPont Cor­po­rate endow­ments defined a gold­en era for Wilm­ing­ton, but at who’s expense? Share­hold­er activism is an impor­tant check and bal­ance for the per­pet­u­a­tion of cap­i­tal­ism. It is not always pret­ty or fair, but it is nec­es­sary.
Wrap-up
As Biden walks from the Unit­ed States Cap­i­tal to the White House for his inau­gu­ra­tion, I am hop­ing that he can cast off the shad­ow of Uncle Dupey as a rich and good uncle. My fin­gers are crossed that he will be true to his word of being a pres­i­dent for all the peo­ple and walk the thin line between cor­po­rate greed and altru­ism to embrace the ten­ants of cap­i­tal­ism. One should always be sus­pi­cious of some­thing too good to be true.