In his campaign against Herbalife, however, one sees Ackman’s deep humanity, a humanity wholly consistent with capitalism’s respect for individuals. Herbalife is a fraud and a cheat, offering a false promise to vulnerable people who invest in what’s truly a mid-level marketing scam. It’s more pyramid scheme than company. They prey on hopeful but unsophisticated small investors, often those who would like to share in America’s promise. Michael O. Johnson, CEO of Herbalife, is a repulsive schemer.
Above, I have embedded a video that Ackman has produced, where victims of Herbalife tell how they’ve been cheated.
Ackman has said that he will carry his short position against Herbalife “to the end of the earth.” That’s the very definition of a respectable position, view, or belief: that one will hold on, against any and all, to the very end. Not everyone believes Bill Ackman’s claims; in fact, Herbalife’s stock has been doing fairly well of late. His bet against them has been an expensive one.
But if he should be right, truly right, then why would he not double and double again his efforts to persuade others?
So he is doing, and in so doing, Bill Ackman is doing right, not merely for his investors, but for the many small investors that Herbalife cheats each and every day.
Looking at this one way, Bill Ackman didn’t have to wage a long war against Herbalife; he might have chosen any number of alternative causes. Looking at this another way – properly, I think – he most certainly did have to wage war against Herbalife, whatever the time or cost.
There is much to admire in his campaign against that foul company, and reason to emulate a commitment to fight ‘to the end of the earth’ in defense of other causes, too.
Here’s a link to more from Pershing Square: Facts About Herbalife.
See, also, a large (over 300 pages) pdf file with the case against Herbalife.