Sad News: America's Billionaires Facing Tough Times

By Sam Pizzigati, Too Much: A Commentary on Excess and Inequality. Posted March 20, 2009.

Forbes magazine, our globe's premier scorekeeper for the games rich people play, last week delivered its latest annual tally of the world's billion-dollar fortunes, the first since the world economy went into meltdown mode. The Forbes verdict: We're seeing some mighty bad times for billionaires.

"Like the rest of us," intones Forbes, "the richest people on the planet have endured a financial disaster."

That theme quickly bounced around the world. The global economic crisis, noted a Times of South Africa editorial, has "hit the super-rich in the bread basket."

"The very wealthiest men and women," echoed the Times of London, "are suffering too."

The evidence? Since last year, says Forbes, the world's billionaires have lost $2 trillion off their $4.4 trillion collective net worth. The total global billionaire population has shrunk 30 percent, down to a mere 793 deep-pocketed souls.

In at least one case, these numbers certainly have translated into real suffering. This past January, Germany's fifth-richest billionaire, Adolf Merckle, killed himself. The industrialist stepped in front of a commuter train shortly after losing $500 million in the German stock market.

But Merckle may have been the meltdown's only real billionaire casualty. The world's super rich have actually survived the first stage of the global economic crisis quite nicely. Even those former billionaires who now count their fortunes in mere hundreds of millions, like former Citigroup CEO Sandy Weill, remain comfortably insulated from any state remotely close to suffering.

Not too many current or former billionaires, as the Toronto Star's Andrew Chung suggested last week, need "give up the $6,000 Dorchester Suite in London, or the $5,000 nightclub outing at Famous in Moscow, or the $7,000 Kiton suit from Saks Fifth Avenue in New York."

Some 44 billionaires, Forbes notes, have actually grown their fortunes over the past year. Hedge fund manager John Paulson, for instance, doubled his personal fortune to $6 billion, mainly by cashing out on bets that the mortgage market would nosedive.

Big Pharma executive Patrick Soon-Shiong did almost as well. He added $2 billion to a fortune that started the year worth $3.5 billion. Soon-Shiong scored big on the sale of APP Pharmaceuticals, one of his drug companies, after a contamination scare in China left APP the only U.S. source of a widely used blood-thinner.

See more stories tagged with: economy, billionaires, rich, financial crisis

Sam Pizzigati is the editor of the online weekly Too Much, and an associate fellow at the Institute for Policy Studies.

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