jealous? On Sep 12, 4:35 pm, Frank <[EMAIL PROTECTED]> wrote: > WSWS : News & Analysis : North America > The very rich in America: “The kind of money you cannot comprehend” > By David Walsh > 19 April 2006 > > Use this version to print | Send this link by email | Email the author > > “Let me tell you about the very rich,” F. Scott Fitzgerald famously > wrote in a 1926 story, “They are different from you and me.” But even > Fitzgerald could not have imagined how different “from you and me” the > very rich would become in America eight decades later. > > The sums that the very wealthy have at their disposal in the US are > almost unimaginable: Oil executive Lee Raymond receiving some $400 > million in a retirement package; the 2005 compensation of bank > chairman Richard Fairbank totaling some $280 million; Omid Korestani, > head of Google’s global sales, exercising stock options providing him > with $288 million last year. > > The accumulation is brazen. What once would have been considered a > somewhat discreditable fact of social life, the proliferation of > billionaires, is now hailed as a sign of America’s success. The demise > of the Soviet Union and the supposed absence of any alternative to > capitalism, the putrefaction of the AFL-CIO trade unions, the > ignominious collapse of American liberalism and the lack to this point > of broad-based, organized political opposition to the ruling elite and > its two parties have rendered the American financial aristocracy > “dizzy with success.” These people have lost their heads. > > In the face of public outrage over oil company profits and soaring > gasoline prices, Exxon arrogantly defended Raymond’s hundreds of > millions, arguing that they were rewarding the executive’s > “outstanding leadership of the business, continued strengthening of > our worldwide competitive position, and continuing progress toward > achieving long-range strategic goals.” The company added that it > considered Raymond’s compensation package “appropriately positioned.” > > In a study published in October 2005, three accounting professors > reported that negative, even occasionally scathing press coverage, > “does not substantively change corporate behaviour with regard to pay > packages.” The American establishment is all but impervious to the > sentiments of the broad masses of the population. In response to a > recent report detailing the immense and growing social gap, a > spokesman for New York state’s Business Council told a reporter that > the incomes earned by his state’s rich were “something that everybody > who cares about New York should be pleased about.” > > An insulated world of immense wealth exists as never before, at least > in modern US history. The number of Americans with assets of $1 > million or more reached 7.5 million in 2004, according to a survey > conducted by the Spectrem Group. Beyond that, however, are those who > possess “Ultra High Net Worth” (a mellifluous term invented by Merrill > Lynch circa 2001): individuals in households with $5 million or more > in net worth. In a country of 300 million people, the UHNW form a very > small percentage of the population, but a not insignificant number in > absolute terms. Economic, political and cultural life in America is to > an enormous extent organized for their benefit. > > This is not simply obscene or unjust, it is socially irrational and > immensely destructive. How is it possible to allocate resources, > repair and renew the infrastructure, carry out any type of long-term > economic planning, cure any social ills, when the official guiding > principle is the ability of an oligarchic elite to accumulate ever- > greater personal wealth? The gravitational pull of such wealth asserts > itself in every aspect of life. > > The New York Times reported last year on a relatively new phenomenon, > magazines oriented entirely toward the very wealthy. Absolute > Publishing, the Times noted, had just started up a publication called > Absolute, “for distribution to New Yorkers with an estimated annual > household income of at least $500,000.” > > The editor of Absolute, Ernest J, Renzulli, is aiming for an audience > of only 60,000 New York residents. He found his target readership “by > winnowing databases of the most affluent New York ZIP codes with > people who have bought houses for more than $2 million and people who > have registered cars, boats or planes that cost more than $75,000.” > > “It’s a small number,” the Times quoted Mr. Renzulli as saying. “But > this is not a magazine that’s about mass reach. It’s about reaching > the tip of the pyramid.” > > The Times take note of Michael Silverstein, an executive with the > Boston Consulting Group and co-author of Trading Up: The New American > Luxury. Silverstein estimates that by 2010 Americans will spend $1 > trillion on luxury goods. The Times continues: “In an ever more > fragmented media world, the rich are becoming their own niche. They > may be diverse connoisseurs of fashion, yachting or jewelry, but they > share one important trait: a seemingly bottomless supply of disposable > income.” > > It must indeed be a predicament to be saddled with tens of millions or > hundreds of millions of dollars, or more—how is one to spend such > sums? Those “awash in cash” (the Times’ phrase) must rack their brains > and devote hours to the problem. How could one ever rest? Would not a > person require a certain degree of inventiveness to come up with ways > of spending such a fortune? > > Judging by the results in published reports—no, not particularly. By > and large, the fabulously wealthy have derived their fortunes from > inheritance, the stock market, the real estate bubble, fortunate > investments in technology or, perhaps, American militarism: in short, > from semi-automatic economic and social processes associated with the > lowering of living standards for millions in the US and the super- > exploitation of masses of people in impoverished countries in other > parts of the world. They are not startling or outstanding in any > fashion, except perhaps in the depth of their greed and > shortsightedness. > > So we learn that Microsoft’s Paul Allen owns a $250-million, 414-foot > “gigayacht,” with seven decks, two helicopter landing pads, a swimming > pool, a basketball court, an infirmary, a garage for Land Rovers, a > movie theater, a concert space for 260 and a recording studio. Not to > be outdone, Larry Ellison of software giant Oracle had his giant yacht > built 452 feet long. Ellison’s vessel has five stories, 82 rooms, “a > wine cellar the size of most beach bungalows, a dozen yacht-length > tenders, and a generator capable of providing enough electricity for a > small town in Idaho or Maine... Final cost: $377 million.” (Associated > Press) > > The wealthy elite are also purchasing their own widebody airplanes, > reports Business Week—Airbus A340s and Boeing 777s, which list for > over $100 million—as “airborne penthouses.” Customized outfitting may > add $25 to $30 million to the cost. > > The “supercar” business is also thriving. Ocean Drive, one of the new > magazines aimed at the affluent, carries a piece on Michael Fux, whose > Sleep Innovations manufactures Memory Foam products. Fux has collected > some 50 luxury cars. He recently took possession of a $2 million > Ferrari FXX, one of only 20 in the world. > > USA Today, in a piece describing the new “super-rich supercar > fanatics” who collect Ferraris and Maseratis and Bugattis, cites the > comments of one auto broker in southern California, “There’s a whole > new breed of collector that has emerged in the last three-four years. > Almost all make the kind of money you cannot comprehend.” > > Yet great unease persists in these circles. A yacht broker told > Associated Press that “a sea change in attitude among America’s > superrich” has taken place in the wake of September 11. “Clients are > telling me, ‘Hey, I could have been in the Twin Towers. That could > have been me jumping out a window.’ The thinking among wealthy people > now is, you can die anytime. Nobody can protect you. So you might as > well spend your money now and enjoy it.” > > Likewise, in its analysis of the trends driving the purchase of jumbo > jets by wealthy individuals, Business Week notes: “Because of > increased concern over security, especially post-September 11, some > businesspeople now use their aircraft as a base of operations on > overseas business trips. Rather than going to a hotel or office after > landing, they just stay onboard... “ > > The term “conspicuous consumption,” coined by Thorstein Veblen in The > Theory of the Leisure Class (1899), hardly does justice to the current > situation. There is a considerable element of recklessness, even > desperation, in the obsessive spending. Throwing money to the wind > hardly speaks to a sense of historic optimism or confidence among the > elite in its own future or the general health of the American social > order. > > At the height of US global economic hegemony, in the 1950s, corporate > directors were expected to lead rather sedate lives, modestly tending > to the nation’s economy. Of course they lined their pockets, but they > were not expected to live like pharaohs. > > In 1957, Fortune magazine reported that some 250 or so individuals in > the US were worth $50 million or more. The wealthiest of them, oil > tycoon J. Paul Getty, stood all alone in the $700 million to $1 > billion category. The equivalent of $50 million today—some $350 million > —would not place an individual anywhere near the richest 400 people in > the US, according to Forbes’s 2005 list (which begins at $900 > million). Getty would find himself somewhere between 31st and 42nd on > the list. > > The roll call of the wealthiest Americans a half-century ago included > famous names—Rockefeller, Harriman, Mellon, duPont, Astor, Whitney and > Ford, along with a quartet associated with General Motors, Alfred P. > Sloan Jr., Charles F. Kettering, John L. Pratt and Charles S. Mott. > These were all ruthless capitalists, but their fortunes were based, > directly or indirectly, on the growth of the productive forces. > > Today, the list of the super-rich reveals an extraordinary growth of > parasitism. One indication is Forbes’ listing of the “400,” which > includes an extraordinary number of people whose wealth, according to > the publication, is derived from “Investments,” “Hedge Funds,” > “Leveraged buyouts,” “Real estate,” “Fashion,” etc. The “captains of > industry” of old are few and far between. > > A perusal of publications such as Ocean Drive, or Gotham, or Los > Angeles Confidential sheds some light on the current tastes and > opinions of these very rich. > > Real estate expert Steven Gaines told Gotham in a recent interview, > “where you choose to live [in New York City] defines you more than in > any other city. There’s a right side and a wrong side of the tracks in > every city; but in New York, what floor you live on, which direction > your apartment faces, whether you move one block in either direction, > says a tremendous amount about who you are and your personal sense of > adventure.” > > Asked about co-op boards rejecting celebrities, Gaines replied, “I > haven’t heard of any juicy rejections lately. Celebrity rejections are > very 90s; they don’t really happen anymore. People are very impressed > by money; that’s all it takes now. Also—and this is the most important > thing—they’re not building any more [co-ops]. We don’t need any more > because people don’t really care who their neighbors are. [Most > people] figure that if a guy can afford a $12 million apartment in the > Time Warner building, he’s cool enough to live next door.” > > This theme—money is absolutely everything—recurs again and again in > studies of the contemporary American elite. > > The Times reporter, Katharine Q. Seelye, in her piece on magazines for > the affluent, described the publications in these words: “Most of the > magazines rely on a similar formula: extravagantly lush photography on > heavy paper stock, flattering feature articles on prominent local > personalities and snapshots of those personalities hobnobbing with > each other... The magazines also make it easy for readers to buy what > they see on the page, whether it appears in an advertisement or an > article—and it is often difficult to tell the difference, as the > magazines have elevated commercial product placement to an art form.” > > The magazines appear at first glance to be nothing but expensive > advertisements for clothes, watches, condos and automobiles—hundreds > of pages of them (Los Angeles Confidential runs to 350 pages, Ocean > Drive an astonishing 530!). The table of contents, gossip columns and > articles, such as they are, do little to distinguish themselves. They > humbly give way to the full-color photos of handbags and bracelets and > motorcars. > > Such a magazine is merely a scaffolding for the marketing of highly > expensive products. It is a relatively convenient means of making > known to a specific clientele what is available for them to purchase > this month. And this is not something that those involved would be > ashamed to admit. No, we have moved far beyond that. > > Gotham appears to specialize in real estate gossip, appropriate in > Manhattan, which has been ruined by the Trumps and their ilk. Tales of > apartment and co-op buying and selling are recounted with relish, with > the sort of sensual zest that others might take in relating stories of > sexual improprieties. In a recent issue, one piece excitedly recounts > that “the penthouse apartment of the late philanthropist Enid Haupt > has sold—at least three times. The nine-room duplex at 740 Park > Avenue, with two principal bedrooms and three-and-a-half baths, has an > accepted offer for its asking price of $27.5 million, with two backup > bids—in case the famously persnickety co-op board decides to reject > the winning bidder.” > > In another column, we learn that “Out in the Hamptons [on Long > Island], entrepreneur Linda Wachner is listing her seaside estate [a > summer house] for a sky-high $62.5 million, the highest price ever > asked for a Southampton Village home. The ocean- and bay-front > Southampton estate on Meadow Lane features a 16-room, two-story > shingled traditional mansion measuring nearly 10,000 square feet with > 10 bedrooms, 14 bathrooms, several public rooms, a wine cellar, and > staff quarters. The property includes several hundred feet of > beachfront, a rose garden, a putting green, a pool with spa, and a > tennis court with a pavilion. ‘I think it’s an exciting property,’ > Wachner told the New York Post. ‘We’ve had a lot of fun here.’” > > Unique Homes reports that the Stanhope, on Manhattan’s Fifth Avenue, > is currently being renovated into 26 luxury residences. “The space is > divided into half-floor residences of approximately 4,000 square feet > (starting at $10 million) and full-floor residences measuring 8,000- > plus square feet ($30.5 million and up).” The old Plaza Hotel is also > being transformed by a developer into private residences, 182 of them. > The one- to five-bedroom units will be priced between $2.5 million and > $33 million-plus. > > The wealthy pockets of south Florida are targeted in Ocean Drive. The > size of a small telephone book, the magazine seems desperate to please > and impress. It takes the most ridiculously self-serious attitude > toward trivial people and circumstances. Page after page of attractive > but glum models dominate the publication, a cornucopia of expensive > consumerism. > > Stiff competition between real estate projects is very much in > evidence here. Three operations, Donald Trump’s “Trump > Hollywood” (i.e., Hollywood, Florida), St. Regis Resort & Residences, > Bal Harbour and Icon Brickell, with “breathtaking views of Biscayne > Bay,” have included their own elaborate, pull-out brochures in the > magazine. > > The St. Regis is especially noteworthy for its quite conscious effort > to evoke an imaginary aristocratic past. It employs butlers. Here is > the advertisement for that service, a disgusting passage over which > some wretched soul expended a great deal of effort: > > “The St. Regis Butlers are adept at executing your requests while > anticipating your every need with consummate style. Every preference > is committed to memory. Dinner for two on the beach at seven-thirty? > Shirt collars heavily starched? A car to retrieve your business > partner from the airport tomorrow morning? It’s a pleasure. Your St. > Regis Butler, always on call, is your household manager, your link to > St. Regis services and your master of conveniences. All embrace the > authority to go to any lengths to ensure you the utmost in comfort, > down to the most particular request.” A butler...or an indentured > servant, a serf, a slave? > > One could go on, but the outlines are clear. A type of aristocracy > rules America, which has more than one feature in common with the > ancien régime that presided over pre-revolutionary France. This vast > accumulation of wealth at one pole of society is incompatible, in the > long run, with even the trappings of democracy. The super-rich own > everything in the US, including the political parties and the > political process. They allow the population to vote at this point, > more or less. But for how long? As resistance to the policies of the > elite mounts and the two-party monopoly threatens to crumble, why > should the riffraff be permitted a say in such important affairs as > elections? --~--~---------~--~----~------------~-------~--~----~ Thanks for being part of "PoliticalForum" at Google Groups. For options & help see http://groups.google.com/group/PoliticalForum
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