26 January 2011

"The rich are different from you and me"

The title is a slightly abbreviated misquotation from the short story "The Rich Boy" (1926), by fellow-Minnesotan F. Scott Fitzgerald: "Let me tell you about the very rich. They are different from you and me. They possess and enjoy early, and it does something to them, makes them soft where we are hard, cynical where we are trustful, in a way that, unless you were born rich, it is very difficult to understand."

A good example is given in yesterday's Wall Street Journal account of the divorce of a fund manager:
* The couple owned six homes–including a $4 million home in Rancho Santa Fe and a penthouse in Manhattan–and had two more under construction. The total value of the homes was more than $40 million...

* Mr. Brandes owned 10 Ferraris (valued at more than $4.4 million) and an “extremely long driveway” to race sports cars, dirt bikes and ATVs.

* She had gambling bills of as much as $30,000 a month.

* Mr. Brandes paid Elton John somewhere from $1 million to $1.5 million to perform at his wedding when he remarried in 2006. He paid Christina Aguilera $1 million to perform at a Halloween party...

While the investments generated about $154,881 a month, she said she needed more, citing her clothing budget ($70,000 a year), art spending and gambling bills. Her support increased to $500,000 a month, or $6 million...

She may indeed be entitled to far more than she has already received, since his monthly income is reported to be more than $16 million.

Yet hearing someone say that $6 million a year isn’t enough to live on shows just how removed the economy of the rich has become from the rest of the country...
And today the Telegraph features a story about how "wealth inequality" is under discussion at the Davos summit:
“The increase in inequality is the most serious challenge for the world,” Min Zhu, a special adviser at the International Monetary Fund and a former deputy governor of the People’s Bank of China, told delegates at the Davos gathering...

Nouriel Roubini, professor of economics at New York University, also warned that inequality “exacerbates political instability”...

Mr Zhu said raising taxes on the rich would not address the core of the problem. “It’s not just about tax, we need to go further. We need to look back at how and where this wealth is being created,” he said...


  1. But here's the thing. He makes in excess of $1.9 billion a year. So that $6M she gets is about 3% of his salary.

    If he earned $50K a year, then he'd be paying her $1,500 a year.

    And to think these are the people who Republicans fought hard to keep from raising their taxes.

    What a country.

  2. 10 Ferraris... overcompensating?

    Actually Anon, he "makes" 192 mil, not 1.9 billion. Not that it matters.

    And to think she was a librarian making $6 an hour when they met.

  3. Just imagine how many jobs could be created (or brought back from overseas) if instead of giving huge bonuses to overpaid executives, that money were put to use in the economy. And I don't mean by buyin more Ferraris or houses or subsidizing gambling debts and designer clothes.


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