A review of Chrystia Freeland’s “The Billionaires Next Door”
Created | Updated Oct 22, 2012
http://blogs.reuters.com/great-debate/2012/10/15/the-billionaires-next-door/
2012-10-21
I hold that Plutocrats are “Pollutocrats;” but that is a different, and related, story. Freeland begins and ends her excerpt remembering America’s Gilded Age with Andrew Carnegie. Carnegie thought that the strikingly different material circumstances of labor and industrial magnates created “mutual ignorance” and “mutual distrust” of the two classes.
Even greater than any disparity Carnegie witnessed is the billion dollar Mumbai mansion and its disparity with Dharavi, which is just seven miles away. Bill Gates’ 66,000-square-foot mansion nicknamed Xanadu 2.0 stands in stark contrast with the homes of the poorer people of Washington State.
For me, Billy Gates epitomizes what I think is the free-enterprise system gone wrong. But that too, is another story. As Freeland points out, Billy downplays what it is like being rich. As an escaped Technocrat Emeritus myself, I remember what it was like psychologically to drive a new car. I heard myself grumbling about the condition of the poor people’s cars and how they were causing problems on the road that I would have to “pay” for in the long run. If they outlawed the older cars, we could rise the speed limits. I was amazed to hear myself think such thoughts. I had come from the lower income levels and it had just been a stroke of fortune that I lived in Silicon Gulch [Santa Clara County]. My Father-in-law told of the many fruit orchards he had to uproot for new construction. My Father worked for Lockheed Missiles and Space Division doing what we know not. Billy went on to say, “after a few million or something, it’s all about how you’re going to give it back.” Crumbs that is, crumbs from the King’s table given to make the most of the PR needed to counteract the rank reputation earned while making that money.
Freeland goes on to observe that private planes are common, chauffeurs not so much. One CEO I worked for made no bones about the fact that his company existed to support his hobby of flying.
In the atmosphere of extreme income polarization within The Valley many became contract workers. This loop-hole is to allow a company not to have to treat a person as a real employee. At times, Engineers used this loop-hole in the opposite way. As contract people, they could be paid more than other peer employees. Whether it was a class below or a class above, contract employees were from a different class of people. Freeland overlooks the class above that could allow a Technocrat to make more than a CEO.
Mikhail Khodorkovsky, was once the richest man in Russia. “…everyone could have done it.” He once said. Subsequently his company was appropriated by the state and he went to prison for fraud and embezzlement. He has tempered this outlook: from the gulag he admitted that he “treated business exclusively as a game” and “did not care much about social responsibility.”
Who reads Ayn Rand anyway? Well, I admit she is an interesting footnote in history. Khodorkovsky did not base his actions on Rand’s literature, just his own experience. During the Russian financial crisis some of his minions had made mistakes that had cost Khodorkovsky hundreds of millions of dollars. He blamed himself in that they were just minions, therefore something must have been "wrong" with them, and therefore they shouldn’t have been trusted to make such decisions. The arrogance you hear in Khodorkovsky’s comments is the product of believing he is special, that he is special independent of the times and circumstances.
“That this talent for organization and management is rare among men is proved by the fact that it invariably secures enormous rewards for its possessor, no matter where or under what laws or conditions,” Carnegie wrote. “The experienced in affairs always rate the man whose services can be obtained as partner as not only the first consideration, but such as render the question of his capital scarcely worth considering: for such men soon create capital; in the hands of those without the special talent required, capital soon takes wings.”
As good as Freeland is, she does not go nearly far enough.
.
2012-10-21
I hold that Plutocrats are “Pollutocrats;” but that is a different, and related, story. Freeland begins and ends her excerpt remembering America’s Gilded Age with Andrew Carnegie. Carnegie thought that the strikingly different material circumstances of labor and industrial magnates created “mutual ignorance” and “mutual distrust” of the two classes.
Even greater than any disparity Carnegie witnessed is the billion dollar Mumbai mansion and its disparity with Dharavi, which is just seven miles away. Bill Gates’ 66,000-square-foot mansion nicknamed Xanadu 2.0 stands in stark contrast with the homes of the poorer people of Washington State.
For me, Billy Gates epitomizes what I think is the free-enterprise system gone wrong. But that too, is another story. As Freeland points out, Billy downplays what it is like being rich. As an escaped Technocrat Emeritus myself, I remember what it was like psychologically to drive a new car. I heard myself grumbling about the condition of the poor people’s cars and how they were causing problems on the road that I would have to “pay” for in the long run. If they outlawed the older cars, we could rise the speed limits. I was amazed to hear myself think such thoughts. I had come from the lower income levels and it had just been a stroke of fortune that I lived in Silicon Gulch [Santa Clara County]. My Father-in-law told of the many fruit orchards he had to uproot for new construction. My Father worked for Lockheed Missiles and Space Division doing what we know not. Billy went on to say, “after a few million or something, it’s all about how you’re going to give it back.” Crumbs that is, crumbs from the King’s table given to make the most of the PR needed to counteract the rank reputation earned while making that money.
Freeland goes on to observe that private planes are common, chauffeurs not so much. One CEO I worked for made no bones about the fact that his company existed to support his hobby of flying.
In the atmosphere of extreme income polarization within The Valley many became contract workers. This loop-hole is to allow a company not to have to treat a person as a real employee. At times, Engineers used this loop-hole in the opposite way. As contract people, they could be paid more than other peer employees. Whether it was a class below or a class above, contract employees were from a different class of people. Freeland overlooks the class above that could allow a Technocrat to make more than a CEO.
Mikhail Khodorkovsky, was once the richest man in Russia. “…everyone could have done it.” He once said. Subsequently his company was appropriated by the state and he went to prison for fraud and embezzlement. He has tempered this outlook: from the gulag he admitted that he “treated business exclusively as a game” and “did not care much about social responsibility.”
Who reads Ayn Rand anyway? Well, I admit she is an interesting footnote in history. Khodorkovsky did not base his actions on Rand’s literature, just his own experience. During the Russian financial crisis some of his minions had made mistakes that had cost Khodorkovsky hundreds of millions of dollars. He blamed himself in that they were just minions, therefore something must have been "wrong" with them, and therefore they shouldn’t have been trusted to make such decisions. The arrogance you hear in Khodorkovsky’s comments is the product of believing he is special, that he is special independent of the times and circumstances.
“That this talent for organization and management is rare among men is proved by the fact that it invariably secures enormous rewards for its possessor, no matter where or under what laws or conditions,” Carnegie wrote. “The experienced in affairs always rate the man whose services can be obtained as partner as not only the first consideration, but such as render the question of his capital scarcely worth considering: for such men soon create capital; in the hands of those without the special talent required, capital soon takes wings.”
As good as Freeland is, she does not go nearly far enough.
.
