The new Forbes 400: Provocative wealth amidst social misery
3 October 2009
The 400 richest Americans have so far weathered the second year of the deepest economic crisis since the Great Depression with a combined $1.27 trillion, according to Forbes magazine’s annual list.
The total net worth of the wealthiest 400 Americans actually declined by $300 billion in 2009, down from $1.57 trillion a year earlier.
This is hardly a tale of woe. The average net worth of the 400 richest Americans was $3.17 billion, and it took nearly a billion dollars, $950 million, in order to make the Forbes list.
The decline in the fortunes of the super-rich did not result from a redistribution of wealth. On the contrary, a spate of recent statistics demonstrates an impoverishment of workers and the middle class, alongside heightening income and wealth polarization. (See, “US Census Bureau: 40 million living in poverty”)
Instead, the fall-off in the billionaires’ fortunes resulted largely from the souring and collapse of certain speculative financial ventures and the stock market.
This is what makes the fortunes of the richest Americans in 2009 so provocative—it is precisely their reckless gambling and insatiable greed that caused the economic crisis now subjecting masses in the US to a level of social misery not experienced in generations.
The obscene wealth of a tiny handful is proof of a dramatic misallocation of resources.
The combined wealth of the Forbes 400, $1.27 trillion, is greater by $483 billion than the entire “stimulus package,” the American Recovery and Reinvestment Act.
The combined fortune of the richest 400 Americans, who comprise just .00013 percent of the population, is greater by about 50 percent than the price of the health care “overhaul” promoted by the Obama administration, which, in the name of “controlling costs,” will carry out substantial cuts in Medicare, ration treatment to the sick and aged, and force families to purchase private insurance.
The personal fortunes of three men, computer magnates Bill Gates and Larry Ellison, and financier Warren Buffett, would each have been more than enough to resolve the 2009-2010 budget deficit of the nation’s most populous state, California, which has been met through deep cuts to social programs and public education, and the furloughing of state workers.
California is home to more than a fifth of the Forbes 400. Eighty-three California oligarchs have a combined net worth of about $234 billion, according to Forbes. That is a multiple of about eight times California’s two-year budget deficit.
Michigan’s ten billionaires have a combined net worth of about $20 billion, about seven times the state budget deficit of $2.8 billion. Among other savage cuts, Michigan lawmakers intend to save $350,000 by shutting down the state’s poison control call center, and about the same amount of money by scaling back a program that pays farmers to send their excess produce to food charities, helping to feed one million people.
New York’s 66 billionaires, 57 of whom reside in New York City, have a combined wealth of $216 billion, roughly 18 times the size of the Gross Domestic Product (GDP) of Afghanistan, whose population of 28 million the US military is attempting to subdue through a brutal counterinsurgency campaign.
In fact, the personal fortunes of individual Americans on the list are larger than the GDPs of a number of countries.
“Bill Gates, America's richest man with a net worth of $50 billion, has a personal balance sheet larger than the GDP of 140 countries, including Costa Rica, El Salvador, Bolivia and Uruguay,” Forbes notes.
And the combined wealth of the Forbes 400 is larger than the GDP of India, the world’s 12th largest economy, and home to 1.2 billion people.
The fabulous wealth that the US financial and corporate elite continue to enjoy in the midst of a financial crisis of its own making is the outcome of long historical processes.
When Forbes first published its compilation of richest Americans in 1982, the wealthiest individual listed was shipping magnate Daniel Ludwig. Ludwig’s estimated fortune of $2 billion would place him far down the list today.
The list of 1982 included names such as Ford, Du Pont, Whitney, Duke, and Harriman, to name a few. These empires were associated with the expansion of US industrial production.
It is notable that on today’s list there are few whose fortunes were built up through the production of industrial goods, except indirectly through inheritance.
Two categories, “finance” and “investments,” provided the fortunes of 106 of the wealthiest Americans. Other major sources of wealth that Forbes identified include media, real estate, oil and retail.