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How Walt Disney Used WED Enterprises, Inc. as a Private Family Holding Company

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After our discussion of The Walt Disney IPO earlier today, which was born out of Walt and his family consolidating three of the companies they owned underneath a single umbrella and issuing shares to the public to help finance the ever-expanding empire, including the creation of the Disneyland theme park in Anaheim, California, I thought it would be interesting to take a look inside the private family holding company he setup around the same time.

[mainbodyad]He ran this private family holding company parallel to Walt Disney Productions and used it in some interesting ways. It differed from the one Sam Walton used, Walton Enterprises, to hold his shares of Wal-Mart Stores, Inc., after the discount retailer’s IPO, but given the nature of Disney’s business, it makes sense what he did. Personally, I vastly prefer Walton’s method. It is more transparent, seems fairer to outside stockholders of the public business, binds the family together in a single economic entity working as a unit for the good of all the members, and consolidates power, but it’s always useful to study alternative arrangemenets.

The holding company was originally called Walt Disney Inc. It was created in 1953 when Walt and some of his design engineering employees formed a new corporation. After the IPO of Walt Disney Productions (later named The Walt Disney Company in the 1980’s to honor its founder; this is the business that you can buy shares of on the New York Stock Exchange under the ticker symbol DIS), the firm changed its name to WED Enterprises so it wouldn’t be confused with the main, publicly traded business. Walt’s brother and co-founder, Roy, strongly opposed Walt’s creation of the company and thought that it was a crooked, selfish move designed to drain the coffers of the main business.

Basically, Walt Disney setup WED Enterprises and gifted shares of it to his heirs. For example, here are stock certificates that he gave to one of his young grandsons for 10 shares, and 2 1/2 shares, in the private company:

Walt then transferred to WED Enterprises a collection of asset and rights, including, but not limited to:

  • The rights to his name and likeness
  • Ownership of certain Disneyland rides, attractions, and assets such as The Disneyland Railroad, the Disneyland Monorail, the streetcars on Main Street, and the Viewliner. They cast members who ran these attractions were actually employed by an entirely different company than the rest of the park as they were on WED’s payroll.
  • The licensing rights to merchandise sold by the public Walt Disney Productions, that entitled him to 5% to 10% of all revenue on items sold, such as stuffed animals, toys, games, etc.
  • The rights to the television show Zorro
  • The right to invest up to 15% of the cost of movies produced by Walt Disney so that his family could keep the money without sharing it with the Walt Disney Production stockholders. The bulk of the investments ended up consisting of a 10% ownership stake in 26 individual Disney live-action movies, the most successful of which was Mary Poppins. It is rumored the Disney heirs continue to generate millions of dollars a year from the income produced by these old films.

Some of the shareholders in Walt Disney Productions, which was traded over-the-counter at this point and not on a major stock exchange since the IPO hadn’t happened yet, sued Walt Disney because they believed he was effectively stealing money from Walt Disney Productions and its stockholders by using WED to divert cash to his own pockets, charging WED for work he should have been doing for the firm, and creating a significant conflict of interest.

And let’s be honest – it wouldn’t pass muster for most people. It looks shady. It was shady. Here was Walt Disney. You invested with him in an illiquid stock that had not yet had an IPO. Then you find out that he has setup another business, is charging your business that you thought you were in together all kinds of fees and licensing rights, and extracting the money for himself, his wife, his children, his grandchildren, and a few other people. Could he do it? Yes. Was the result good? No. His fellow owners felt like he was taking advantage of them. It’s human nature. On this one, Roy Disney was right. Walt should have listened to his brother. He should have been focused on Walt Disney Productions and gone all-in like Warren Buffett did with Berkshire Hathaway or Bill Gates did with Microsoft.

WED Enterprises Changes Its Name and Begins Diversifying

By 1965, the conflict of interest had grown so bad, and Walt Disney Productions, now a public company with many public stockholders, so dependent upon WED Enterprises, that it demanded WED sell it certain assets, as well as change its name. In 1965, the transaction closed, and WED no longer owned those assets, which were now the property of the public Walt Disney Productions. Armed with cash, WED changed its name as required in the buyout contract. It settled on Retlaw Enterprises, and began diversifying.

According to the L.A. Times, the first asset the Disney family bought through the now-renamed Retlaw Enterprises was a television station in Fresno, which started an acquisition spree that ultimately resulted in the Disney family’s private holding company owning a jet charter airline, more than half a dozen CBS affiliates, and nearly 1,200 acres of farmland and undeveloped real estate in Southern California.

In 1982, the public Walt Disney Productions wanted to be done with Retlaw entirely, and offered to buy everything related to the Disney theme parks so they could go their separate ways. At this point, Walt had been deceased for 16 years. It was tiresome and insulting that the namesake, enormous, publicly traded Disney empire didn’t even own its own iconic monorail.

If you dig into the old Securities and Exchange Commission filings around the time, you find out how shocking the figures were. Between 1955 when Walt Disney Productions began to get ready to go public and the end of fiscal 1981, Retlaw had charged Walt Disney Productions $75 million for use of the monorail and Disneyland railroad. It was absolutely ridiculous. Roy Disney was right – the public company, Walt Disney Productions, should have owned those assets from the outset. It really was just a way for Walt to pocket more cash and, just as importantly after the Oswald incident, let him exercise God-like control over the company. He always had nuclear switches that he could push if people challenged him. Can you blame him? I understand the impulse to put in insurance mechanisms that insulate you, especially when you are taking creative risks.

Walt Disney Productions gave Retlaw 818,461 shares of stock to be done with the entire arrangement, which the Disney family members who owned Retlaw took for themselves instead of reinvesting it back in the business; that way, they could each hold shares of the public Disney business individually instead of as a group. Roy Disney once again objected strongly, saying the transaction was overvalued and it was simply a way for Walt’s heirs to take even more cash and ownership out of the public business. He was overruled. Again. I think Walt Disney Productions just wanted to be done with the heirs. At least, that is what the evidence looks like.

[mainbodyad](Note: I don’t think the heirs necessarily did anything wrong. I actually love this idea that they are still living off the amazing things their father and grandfather created, even though I, personally, wouldn’t be emotionally fulfilled if all I had in life were the results of someone else’s efforts. My comments are referring to the abstract ethical ramifications of conflict-of-interest situations like this. If your grandfather were Walt Disney and he gave you shares of a private holding company through which he owned partial rights to Mary Poppins and the transportation at Disneyland, aren’t you going to be happy about it? Wouldn’t you love the stock? I would. I think it would have been better and looked fairer if Walt had, instead, just structured the main public business in a way that achieved the same ends; he could have done what The Washington Post did and given himself a special series of Class A or Class B shares that had the right to elect a majority of the board of directors. He could have paid himself in stock options. That way, everything would at least be crystal clear.)

With the naming rights and other assets now firmly in its control, Walt Disney Productions, a publicly traded behemoth, changed its name to The Walt Disney Company.

By the late 1990’s, Retlaw sold off its remaining television and media assets, which the L.A. Times says in the related story were worth $215 million in cash.

In 2005, 39 years after Walt Disney’s death, Retlaw had been wound down to a fraction of its former self, with Walt’s heirs having taken hundreds upon hundreds of millions in capital distributions and dividends out of the firm for their own personal lives and investment portfolios. At this point, they transferred Retlaw Enterprises to a non-profit called Walt Disney Family Foundation, which runs a museum in San Francisco filled with details, items, and collectibles from Disney’s life. It is run by Walt’s daughter, who is now 80 years old.

What is funny is that Walt’s heirs repeated the same behavior when setting up the foundations. The Walt and Lilly Disney Foundation is where Walt’s wife put most her fortune. Beginning in 2006, the foundation started giving away a lot of the $252,686,699 in assets it had sitting on the balance sheet so that it had $157,169,439 by the end of fiscal 2011. Yet, almost all of the money is going to other family-run Disney foundations. For example, more than $10,000,000 was given to the Walt Disney Family Foundation (the now-parent of Retlaw Enterprises). By structuring the WDFF as a private foundation and not a public charity, the Disney family can get around the disclosure laws so people can’t know what they are taking in salaries and benefits. Apparently Walt taught them well. I have absolutely no evidence for this, and am not indicating that I think the Disney family is doing it, but one technique for wealth preservation is to hire the heirs to run the foundations like this so that you can pay them very large, six or seven figure salaries, while lowering your overall tax bill. If they are doing it, it’s perfectly legal so I see no problem.

The investment choices, and where the money is parked, is also interesting. I find it odd that one of the non-profits, The Walt and Lilly Disney Foundation, has 462,354 shares of Walt Disney common stock just sitting in a Charles Schwab account with margin privileges. The stock has almost doubled since then so the shares would be worth a lot more than the statement shows here:

The Disney foundations have money parked everywhere, in the oddest places and with a strange mix of assets … You can click to download a set of financial statements for one of these foundations (PDF format).

You should see Walt Disney’s will. It is deserving of its own post. He used a series of trust funds and shares of Retlaw Enterprises to effectively make sure his grandchildren inherited a vast fortune, and that it was tied up in a way nobody could screw it up. This man was a shrewd, ruthless business titan. It’s hard not to respect how he marshaled the limited resources he had to create something bankers and investors thought insane. This was not some pie-in-the-sky animator. He knew exactly what he was doing. He used capital structures and legal entities like tools, fitting them together to give him the money he needed to accomplish what it was he wanted at the moment. There are actually a lot of parallels in the ways he set this up between Disney and Maurice Greenburg of AIG, who used a private company called C.V. Starr & Co., Inc. alongside his public enterprise. The founding family of American Eagle Outfitters also has a deal like this, though they’ve hidden it fairly well. They own a real estate company and then have the public business lease from the private real estate holdings, generating de facto dividends for them.

I didn’t expect to spend my night digging through obscure legal databases and foundation tax filings but this has been fun. It definitely gives me an appreciation for the working parts that made up the Disney empire. A fully formed media conglomerate like this doesn’t just spring up over night. It is the result of decades of individual decisions, changing arrangements, and ownership profiles. Comment Policy

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  • Really enjoyed reading your thoughts and information on Disney as I am even more obsessed with everything Disney now that I have watched the PBS I keep trying to find out why none of the family members are involved with the company now. Thinking the corp would want the input of them but I guess there is really not a financial necessity or interest on either side....right or wrong? You say Walt started WED with the idea of giving himself extra income......this is very interesting because most things I have read always refer to the fact that Roy had to continually wrestle with the banks as Walt was only interested in creativity and I have read several times quotes where he refers to money only as a way to finance his great ideas.

    In the long run it only makes him more human to me. One of you very insightful comments talked about emotional power.......Seriously, on the television show, I felt like Walt was actually talking to me and that we were friends and that Disneyland was truly one of the most magnificent, advanced places on earth. After watching several vids about the history it seems like the idea of perfection and suspending the disbelief and strong moral character holds true. it was not until I was really old and had my dream come true through my children--we went there often--did I realize we were basically riding through a movie set in a boat.....only because there was chipped paint and there were outside agency security was really weird.

    I think Walt was not only a genius, had his brother to kindly help him with finance, but was, indeed an extremely complex person as you suggest....going to Disneyland with my children was truly one of my dreams come true in life and still have to remember my group grew up with him selling Pirates on a weekly basis.

    Then there are always those people who do not see it that way at all and hate standing in long lines with burning sun and spending way too much money.

    so we had a route and a plan and I also got somewhat discount tickets at work driving up from San Diego about 2 times a was do-able if I saved in advance, knew the prices after going there a few times and could plan the thing well

    Reading others on low incomes are not really able to afford taking a large family there--particularly if they lived far away.....for instance one could never afford to go to DisneyWorld and stay in a hotel--that would just be out of the picture.

    Thank you for you interest and info and please say more about the family being involved if you can.

    Do you love Word Press---just wondering because I have found it so difficult for a blog site and google puts your post to mobile automatically and lets you know how it is working however my blog is not as large as yours....also google does an excellent job of blocking spams and hacks......but your blog is beautiful.

    What do you think it is that makes Disneyland so irresistible?


      • Very interesting article. I am a sucker for learning about legal structures, passing wealth to future generations, and legal tax minimization.

        I guess if you are wealthy, you can put all the stock/assets/money to a private foundation, and have only family members be effectively elected to the board of directors. You can also have a family controlled company manage investments for the foundation, and earn say 1 - 2% fee on annual assets under management. I am sure you can set it up in a way where management fee is essentially taxed as dividend/capital gain too..

        Of course, you can put certain amounts in Trust Funds with a bunch of restrictions there as well..And what a tax professor I knew always said was to never die single - always die married due to the marriage exemption - assets flow free of estate tax to spouses of the deceased.

          • Suhail Algosaibi 8 years ago

            Very informative and well written. Thank you.

              • Was Disney really shrewd or did he just hire a pack of lawyers and tell them to siphon as much money out of the company as legally possible?

                  • My personal opinion is it was Walt. This is the guy who decided, without any permission, request, or acknowledgment, that he was going to give himself a 50% pay raise to $75 per week, while his brother and partner was still taking home $50 per week.

                    Then, after they had built the Disney Bros. studio, he looked at Roy and said, "Roy, when we move to Hyperion, I'm going to have a large neon sign erected, reading ' Walt Disney Studios'." Roy said Walt looked like he expected a fight but he (Roy) just went with it so the name of the company changed.

                    Later, their equity even began to diverge. Walt took 60% of the stock in Walt Disney Productions, while he gave Roy 40%. Then Walt was siphoning off money with WED Enterprises.

                    It's too much of a pattern, long before he had any money, to just be lawyers. He wanted more. He wanted control. He couldn't stay within a budget.

                      • Even if it was the lawyers, it was the lawyers he chose and thus were just an extension of his views and personality. Excellent series as usual.

                      • FratMan 9 years ago edited

                        Joshua, it is crazy how targeted and specific advertising is. I spent last night reading your (excellently written and very informative) collection of Disney articles, and when I signed on to Facebook today, I saw a bunch of ads advertising Disney cruises and what not. That is crazy (although I still do not know what I did to introduce myself to the plus-sized women advertisements on your site). I think about stuff like marketing and targeted ads way more than the average American (I would guess), and I still get blown away by the technology today.

                        I mention that context for one reason: you said in one of your recent posts that if you deliver an emotionally satisfying experience, you can get rich. But my question to you is this: If you deliver emotional satisfaction, should that come with any kind of moral responsibility that say, a company selling off-brand toilet rolls would not have? It seems that when you enter the realm of emotional satisfaction, it is much easier to manipulate people to your will.

                        Think of a couple where one partner loves the other more than vice versa. When someone loves you a lot more than you love them, you could take advantage of that love asymmetry to get the other person to do all sorts of (foolish, asinine, unwise, pick your adjective) things for you. Applying this to business in general and Disney in particular, it seems they have no hesitancy to leverage the emotional power they have over their consumers.

                        Almost every parent considers it some sort of duty to take their child to Disneyland/Disneyworld at some point in the child's young life. The emotional power that Disney wields over the popular imagination is enormous, and I fully expect your position in Disney stock to reflect that over the long-term. But Disney does not hesitate to use that power to their advantage by pricing things accordingly.

                        I've always had a wary regard for Disney and kept it at arm's lengths for reasons that I have found difficult to articulate. The most poignant example that comes to mind is when I saw my uncle, on the brink of foreclosure, take out a ~$5,000 loan (I'm guessing on the amount) to take his kid to Disneyland because he felt like a bad father and wanted to do something for his kid. Yeah, my uncle has the responsibility to make decisions in the long-term interest of his household, and in this sense, he failed. Disney does not put a gun to anyone's head forcing someone to go there, and it must be offering something worthwhile to get people to spend their money there. But my God, think of that emotional power. His finances were crumbling, and he took on even more debt for a seven-day experience in Disneyland. When you have the ability to make someone do something like that to himself, is there any responsibility?

                        My hunch is that some of the fellow Disney goers you encountered in California had no business being there, from a personal household finances point of view. Yeah, I respect individual autonomy. Yeah, they got something in return for their money, or else they wouldn't be there. No, I don't think anything should be done "legally" to Disney. But it does seem that Disney capitalizes on its emotional power over some unsuspecting/naive/uninformed/easily swayed by charging up the wazoo.

                        I know I'm fumbling here, but something does not sit right with my gut when I think about extreme emotional power being deployed by a company with strong intellectual asymmetry in its favor over the public customer it serves. I understand their legal right to take advantage of it, I understand that other companies do this too and aren't as successful as Disney, and I also understand their duty to act in the best interest of shareholders, but something still makes me uneasy.

                          • Joshua Kennon Moderator > FratMan 9 years ago edited

                            I'll think about your question and respond in a few hours. Before I do, though, something interests me. You said: "His finances were crumbling, and he took on even more debt for a seven-day experience in Disneyland."

                            Your uncle was demonstrating a mental model that I refer to as "What the hell ..." in my files. It comes up in economics, weight management, drug use, and promiscuity quite a bit, as well as escalation of crimes such as petty theft turning into large scale embezzlement. The premise of this mental model is that when faced with things going south, or when having already dipped your toe in the water, people tend to lose all restraint so they "might as well enjoy" themselves. You see someone who is on a diet, and who has a doughnut. Suddenly, they eat three because they already screwed up for the day. Or you see someone who is trying to stay sober have a drink. So they figure they've already messed up, might as well down the entire bottle. That's the WTH mental model in action. It's powerful. It is one of those things you absolutely must learn to remove from your behavior and when you start to indulge in it, recognize it so you can stop.

                            In other words, your uncle wasn't going to Disneyland in spite of his finances, he was going to Disneyland because of his finances. That may seem like it makes no sense but he was behaving exactly like most humans are wired to behave. It is one of the big reasons economics has trouble dealing with poverty - the poor face a different opportunity cost than the rich so it's often better to enjoy whatever windfall they have rather than keep it around so it will be soaked up by an emergency. There was a study done recently you might have seen in the newspapers or online that showed under stress, even rich people begin to collapse into WTH behavior and make sub-optimal allocation decisions of time and money to alleviate the pressure.

                            When combined with two other mental models, social proof and self-consistency bias, you realize that he was trying to make up for what he, either consciously or subconsciously, perceived as a massive failure that went straight to the core of his identiy. Men in the United States are conditioned from birth that their primary role is to provide and that they are otherwise disposable.

                            You see it all the time, even subtly; watching the movie Identity Thief the other day, there is a throw-away scene in the kitchen when the main character is talking to his wife. She is pregnant and they are facing financial trouble. They say they will get through it, "Unless it is a boy ... then we'll send him off the coal mines." Yes, it was a joke, but humor often reveals a lot of a civilization's underlying premises, foundations, and assumptions. We are one of the only civilizations that does not expect women to serve in combat alongside men. We teach little boys to grow up and become firefighters and police officers, both very worthy and admirable professions, but ones that are virtually never encouraged in young girls. There is an overwhelming amount of evidence that the entire academic system is now setup in a way that gives far greater advantages to girls than boys due to differences in learning style and brain development. The list is endless. It is one of the primary evils in the American culture that needs to be rectified.

                            (We could have a very long discussion about the causes, but it goes back to the European concept of chivalry, which I have heard accurately described as a concept that can be boiled down to the fact that a man was expected to sacrifice himself for a woman - any woman - that he had just met, didn't like, or found repulsive, simply because she was a woman. Not only is this insulting to men, it infantilizes women. There were some powerful essays written in the wake of the Titanic sinking from American feminists who were livid that the women had been given preference for the boats because they were saved solely because of their gender and not treated as equals. There was a political slogan used by these suffragettes at the time, who were fighting for the right to vote, "Votes for Women, Boats for Men" in protest. I still marvel at the fact that these women were so bold and were even hosed in the street so that their daughters and granddaughters would someday enjoy full equality under the law.)

                            Your uncle was about to lose his home, but more importantly, he was about to watch his children, for whom he was responsible, get kicked out of their rooms and thrown onto the curb. The desire to at least do something to mitigate that, to say that he wasn't a failure at providing, a concept pounded into his head from the time he emerged from the womb, is overwhelming. It's a coping mechanism and, as horrible as it sounds, your uncle was acting perfectly rationally in his irrationality as it probably did alleviate a considerable portion of the emotional pain, even if temporarily.

                            Had Disney not existed, he would have still spent the $5,000.

                            (Again, I'll think about the core question and get back to you later. I just thought it was interesting to see that same pattern play out because I studied it a couple years back.)

                              • "Had Disney not existed, he would have still spent the $5,000."

                                Brilliant line, brilliant explanation.

                                The "What The Hell" model was definitely at play, from what I could tell at a distance. Additionally, although I didn't mention this in my above comment, there was another mental model at play which I call "The Tyranny of The Better Yesterday" because, at one point in time, he owned a fence company that probably allowed him to bring home $150,000-$250,000, and this was back in the 1990s. The problem was that he lived *at* his means during the good years. Whatever he made, got spent. If $20,000 was sitting over at the end of the year, then that meant one hell of a Christmas and vacation. I don't think things like stock, bond, or real estate ownership ever crossed his mind, which is funny coming from a small business owner (although it might be more common than I think).

                                Anyway, I'm guessing that the fact he could at one point in time provide for his son quite well made the situation quite harder. People can't deal with going backwards. Heck, I'm not even immune from that, and I actively think about this stuff! For instance, in investing, I measure myself in terms of annual income generated, because that figure is more likely to rise each year than my net worth. The couple moving from a $300,000 home to a $250,000 home is much more likely to divorce (I would guess) than a couple moving from a $200,000 home into a $250,000 home. And so on.

                                As long as you feel like you are moving forward, you can cope with a lot of bad things. The second things aren't as good as they once were, mental health starts to fall apart. My guess is that my uncle's visions of better yesterdays also contributed to his decision and added some kerosene to the "What The Hell" model.

                              • Adam 9 years ago

                                Mr. Walt was a thief?

                                  • See? That's the problem. No, he wasn't. At least, technically. Everything he did was legal. And, you might even argue, he deserved it given that he was the creative and business genius behind the empire. It was certainly less lucrative than if he had just used a hedge fund compensation agreement, so he makes today's contracts look positively quaint.

                                    But it looks bad. Maybe that doesn't matter. After all, in the article about the Disney IPO, a single block of 1,000 shares bought in 1957 for $13,880 ended up growing to somewhere between $26,672,640 and $40,000,000. How can an investor complain? It is literally one of the best performances in the history of the world. If anything, Walt was underpaid.

                                    I think it was about control. If you look at what happened to him early in his career, and his psychology profile, I think he wanted to intertwine himself with his business so much that it was impossible for anyone to take it away from him again, or for him to ever suffer through loses as a result of an artist strike, like happened with his animators in the past. He always had a kill switch following those painful early life lessons; mechanisms of power that would make it practically inconceivable that he would ever be at a disadvantage to any other stakeholder and that there was no doubt it was his playground and you were along for the ride, for better or worse.

                                    Part of it could be too that he wanted to be well paid, and executive compensation was pathetic back then compared to today. By structuring it this way, not only did he enjoy much more lucrative pay checks, but he put together a family portfolio of assets that continued generating cash after he died so that his family still enjoyed great wealth even when he wasn't around to mint capital.

                                    Strategically, it was brilliant. It's up for personal interpretation about the morality of his actions.

                                    • Anon 9 years ago

                                      I loved every Disney article you wrote this week. I have a question, given all your Disney knowledge and research. Do you believe Mr. Disney was anti-Semitic and/or racist? There's conflicting information online, and it appears that much of it was gathered/developed after his death. (His accomplishments are undiminishable, but I'm curious what you think.)

                                        • Joshua Kennon Moderator > Anon 9 years ago edited

                                          One of the best lessons I learned during my history courses in college was that you have to go back and evaluate a person's actions and beliefs relative to the society in which they lived in at the time, otherwise you are missing the context for their behavior.

                                          What makes the case of Disney so interesting in regards to the two questions you raise is that there is no direct evidence that he was either of those things. It reminds me of Sherlock Holmes and the case of the dog who didn't bark in the middle of the night. Instead, there is a notable pattern that raises questions.

                                          For example, other than "Song of the South", it's very difficult to name any non-white major role in a Disney film or animation. According to the famous biography by Neal Gabler, Walt Disney: The Triumph of the American Imagination, as late as 1963, civil rights activists were still putting pressure on Walt Disney Productions to hire non-white employees as there was practically no one black that worked for the company.

                                          My personal hunch? It sounds cynical but I think it is the only conclusion that can be strongly supported by the evidence. I believe that Walt was a calculating, shrewd, ruthless businessman. He was also a great artist. He was obsessed with, and only cared about, creating a perfect fantasy world; transporting people to new realms and making magic. In the context of the civil rights movement, with marches going on in the street, sit-ins happening in office buildings, and troops mobilized to stop integration of schools, I think Disney thought race would be a distraction; a sudden reality check that caused psychological associations when walking through his pretty pink castle or going through a haunted mansion. I think he then, knowingly or unknowingly, built a culture that reflected most companies of his days in that they were inaccessible to minorities. It wasn't that he was personally prejudiced; I think, as horrible as it sounds, that civil rights conflicts simply got in the way of his play time and he wasn't having any of it.

                                          I think that conclusion is only strengthened when you look at how Walt dealt with other disenfranchised minorities at the time. It helps establish what I think is a pattern. For example, Tommy Kirk was Disney's go-to golden boy, appearing in films such as Old Yeller, The Shaggy Dog, The Absent-Minded Professor, and Swiss Family Robinson. The boy dream of millions of young girls minted money for Walt Disney Productions. When Kirk was 17 or 18 years old, his mother found out that he had fallen head over heels in love with a boy his age from the local pool and the two had been having an affair. She went to Walt Disney and informed him of her son's love life. Disney never said anything cruel, but silently made a decision to not renew Kirk's contract, refuse to let him get any future parts, and made him fade into obscurity despite his fame and fan base because Walt didn't want the scandal. He wanted absolutely nothing controversial. Disney wouldn't even evaluate whether it was right or wrong, if it got in the way of his playtime, it was immediately destroyed. But the telling part? When he personally called Kirk in for a meeting to fire him, he asked the young man to at least film "The Monkey's Uncle" because the Merlin Jones franchise had been a big money maker for the studios and Walt wanted the cash. That's what concerned him. That's what he cared about because he needed it to paint his picture; to build his parks; to expand his empire.

                                          Disney did the same thing for the personal appearance of his employees. It took 60 years, until 2012, for the Disney company to allow male employees to have any sort of facial hair at all! It wasn't until 2010 that female employees in the parks were given the option not to wear panty hose! It was all about an illusion of a certain, seemingly idyllic life, or what passed for one in the 1950's.

                                          The charges of anti-Semitism arise almost entirely from his decision to be a member of an organization that banned Jews, as almost all did in those days. One of the only business leaders at the time who didn't do something like this was Warren Buffett. He resigned from a Country Club in Omaha when they wouldn't let Jewish members join, as his mentor and role model, Benjamin Graham, was Jewish. That was extremely rare.

                                          In this case, I think it was simply not on the radar. It is remarkable how insensitive people can be. Today, we don't have non-Jewish or White-only Country Clubs in 99% of the nation. Our social issues are different, but the patterns are identical. As Mark Twain said, history doesn't repeat itself but it does rhyme.

                                          (To give you an example, I know a woman roughly my age who couldn't understand why her brother wasn't speaking to her and had grown upset by it to the point she was despondent. Her brother and his husband are a big part of this lady's life, taking care of her kids (the nieces and nephews), coming over for dinner all of the time, taking them to the movies, building forts, helping to save for college. They are an extremely close family. This woman decided that the best private school in town was a chartered religious school, so she sent her kids off to study at it even though the website of this school has directly under its statement of beliefs some of the most offensive stuff you will ever read, including a passage about how they will seek out and expel any student who has a gay family member because it is "an abomination". (I actually was skeptical of that part until I loaded the page and saw it for myself. Sure enough, it's right there. It is surreal.) She didn't think anything of it. She was truly baffled when her brother and brother-in-law won't even speak to her at Christmas dinner, won't come see her kids anymore, won't return her phone calls. She thinks they are being overly sensitive and that they should just accept it. Now, her friends and family have split into two camps, with a large percentage refusing to even be civil with "the bigot".)

                                          Throughout history, certain minority groups get targeted for isolation as a way of maintaining social power structures. First it was Jews, then blacks, then women, then gays. I'm not sure who the next group will be but civilization has exorcised most of the stupidity of our primitive, barbaric ancestors. Though there is a long way to go, I have faith we'll get there in the end. Very few people, by definition, stand up before it is popular and call out the idiocy and moral wrongness of the institutions and organizations that perpetuate these barriers (if they did, the barriers wouldn't exist). Thus, Walt was probably more reflective of his time and generation than personally invested in the question.

                                          In other words, I think Walt Disney's actions were certainly bigoted, if only by the lack of what he did, but it was the result of obsessive focus, insensitivity, ignorance, and myopia rather than malice. He was precisely the type of man Martin Luther King Jr. was talking about when he said, "In the end, we will remember not the words of our enemies, but the silence of our friends." So was he racist? Was he homophobic? Was he anti-Semitic? Was he (insert cultural judgment here)? It's impossible to say. It appears no more so than a vast majority of society at the time. I think he simply did not care about anyone but himself, his immediate family, and the magical empire he was building. Anything that threatened that, or distracted from it, was avoided, isolated, or removed from his life.

                                            • As for who the next ostracized group will be, I think right now we're seeing a shift (personified in your example here) whereby the "bigots" are the ones it's socially acceptable (indeed, even encouraged) to be prejudiced against. People are shunning family who happen to have political or religious views that are out of line with what is currently fashionable. We're coming full-circle: First, it was the whites who thought it was ok for them to marry blacks that were shunned by the rest of polite society; Now, it's the whites who DON'T think it's ok for a white to marry a non-white who are being shunned. At the end of the day, it's still ostracizing people over their sociopolitical viewpoints. In many ways, the "bullies" are the ones now being bullied. And the new bullies are just as self-righteous in their beliefs and actions as they denounce the old ones for being.

                                                • Joshua Kennon Moderator > Scott McCarthy 9 years ago edited

                                                  I don't disagree with you but I do think, in a macro, evolutionary sense, the phenomenon you are describing here is slightly different than picking out a group for its intrinsic characteristics (e.g., ancient Egyptians believing it is an abomination to eat with an Israelite and enslaving them) because this phenomenon actually plays an important role in human success and survival that, in the aggregate, has been a net positive; hence, the paradox. What you are describing is unique in that it is one of the mechanisms used to regulate cohesive social pacts and community identity. It has been harnessed for a long-time by those in power; e.g., it's the same mental model that was responsible for the political cartoons back in World War I and II that said boys who weren't going off to fight were cowards and should feel shame, which at least in the case of the latter, probably resulted in the self-survival of the nation.

                                                  The posts the past few days have been dealing with Walt Disney and the company/companies he built so let's stay with that framework for an illustration. Disney's father, Elias, was, in my personal opinion, an absolute, insufferable idiot; a foolish, pigheaded, selfish, prick of a man with a sense of entitlement and morality that disgust me. While he was not without his virtues - not that it matters as even Hitler had his beloved dog Blondi - the balance was such that I find nearly everything about him offensive and frustrating. When he bought a farm in Marceline, Missouri, Elias "told one neighbor that he did not believe in fertilizing his fields because doing so was like 'giving whiskey to a man - he felt better for a little while, but then he was worse off than before.'" He also would water his horses once a day in mid morning, instead of three times a day (morning, noon, and night) like the other farmers because he thought he knew better.

                                                  Of course, he ran the farm into the ground, had to sell it at auction, and then move to Kansas City, yet another massive failure that caused him to resent his more successful brother even more. Elias was stubborn to the point of insolence, but for most people, the self-righteous mocking of neighbors and peers would have been enough to change, or at least consider changing, as better information was adapted. It would have saved them from ruin. It's one of the ways humans progress so rapidly once a new technology or more efficient means of production has been discovered. So, yes, there is a dark side (e.g., Walt Disney was mocked in childhood for not conforming to gender expectations because drawing was not an activity boys engaged in frequently, yet it turned out to be his golden ticket; the thing that made it possible for him to leave his wife, children, and grandchildren a vast fortune and a legacy that ranks him as one of the most influential figures of the 20th century), but it simply cannot be exorcised from humanity without removing the reason it evolved in the first place, which is an enormous adaptive advantage.

                                                  Part of this is colored by my own findings. A lifetime of study has led me to the conclusion that not all cultures, and not all beliefs, are equally worthy of respect or consideration. This is not a particularly popular belief as there is this subconscious assertion in many people in the United States right now that we should all hold hands, sing Kumbaya, and treat all opinions equally and with dignity. I think history has shown that is foolish and dangerous. Everyone is entitled to their own opinions, but they are not entitled to have those opinions be taken seriously when there are significant flaws in them or they can be demonstrably proven as false.

                                                  To be more specific, I think of it like this:

                                                  1. On matters that can be weighed against evidence, I follow the rule of critical thinking and use a ranking system of "True", "Mostly True", "Somewhat True", "Unable to Determine", "Somewhat False", "Mostly False", and "False".

                                                  2. On matters that require moral judgements, I use the standard of morality I've discussed in the past as it is the only one that can be justified in any sort of provable, cohesive, intellectually consistent way. Thus, when I look at a nation such as Iran, where someone who commits adultery is buried up to the neck and then the community grabs heavy rocks and stones, bashing his or her skull in as blood goes everywhere and the body is ripped apart, I can say with absolute certainty, even self-righteousness, that the people who engage in this sort of behavior should be ostracized. They should be mocked. They should not be tolerated. It doesn't matter if they are doing it because it is tradition, because they believe a god demands it, or because they think it is right. It is barbaric. It is sick. It reduces humans to nothing more than monkeys, screeching and squealing at the excitement of bloodshed, while simultaneously doing enormous damage to the civilization by holding back further development as human capital is routinely destroyed and murder considered an acceptable form of retribution or conflict resolution.

                                                  TL;DR: We'd discussed in the past how cultures are like operating systems in software; they are the framework that influences how the individual programs, or people, live their lives and behave. Social death and isolation has been a primary tool for system stability for a long time and probably shouldn't be compared to, say, hating someone simply because he or she is an Arab or stereotyping a white southerner as a racist because of his or her accent. They may look the same on the surface, but the causes and factors that influence it are very different.

                                                    • +1 Scott. You hit the nail on the head.

                                                      As I type this, CNN is alerting us that the Food Network is dropping Paula Deen for her use of the n-word. My guess is that if you asked most Americans, they would tell you that they believe in forgiveness and the general teachings of Christ. Yet we have completely lost our ability to forgive when we apply theory to reality. She is on television apologizing right now, and yet, it's being completely rejected. No one gets a second chance anymore. It's bizarre. If you said something racist, homophobic, misogynistic, or whatever, you're done. Your apology is not accepted, and you will be blacklisted from mainstream society.

                                                      On television, a straight white male conservative has far less leeway with what he can get away with saying than what a gay black woman can say. Or at least, it's a lot easier for the straight white male conservative to say something to get shunned than the latter. That's a modern-day application of the shunning you mention--the range of opinions that certain people can have is more restricted for certain groups than others.

                                                      My grandpa had all the prejudices you'd expect from a working-class white guy in the 1950s. If I could sit him down at a table in 1957 and explain the popularity of gay marriage to him and I tried to explain race-based affirmative action to him*, I doubt he could comprehend it. Furthermore, I doubt he'd understand it if I explained that being a smoker is something he'd be ostracized for fifty years later!

                                                      *= I did not intend to conflate gay marriage rights with affirmative action. Gay marriage is something that should be legal due to a respect for personal liberty and personal choice, but I cannot for the life of me figure out race-based affirmative action. Why should Barack Obama's daughters have an institutional advantage over a poor white girl living in East St. Louis simply because of the color of their skin?

                                                        • Straight white conservative males are now on probation for past sins, in many ways that mimics our justice system so one can conclude it's a rational response to make sure bad habits don't reassert themselves. Whites in general are on probation too, so it makes sense the Obama daughters should have an advantage and Paula Deen is not quickly forgiven. If someone abuses you everyday it's not ok just to say we will stop today, there has to be consequences (according to our justice system we have in place today anyway.) Jesus forgives but our justice system never does.

                                                        • Par excellence! Thank you; I'm glad I asked.

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