The Truly Wealthy: Just Like the Rest of Us?
What would fall be like without the entertainment of the Forbes 400? With the welfare poor scrambling to find jobs and municipalities worried about meeting their budgets, it is nice to know that someone is doing well. Even if life is inherently unfair, with some big winners and losers, everyone has an even chance to win the great lottery of life. Never ones to be reticent in their celebration of capitalism triumphant, the editors of Forbes weigh in on this theme every fall. Their Forbes 400 feature, rating and analyzing the assets of the wealthiest among us, has become the financial press's answer to "The Lives of the Rich and Famous." Last fall, Forbes gushed: "Forget old money. Forget silver spoons. Great fortunes are being created almost monthly in the U. S. today by young entrepreneurs who hadn't a dime when we created this list 14 years ago." A little less ebullient this year, they celebrate the "creative destruction" of the market and suggest that their club enjoys an open admissions policy. They characterize 219 of its members as "self-made." The Forbes list does indeed merit close scrutiny by those who wish to understand our economy. It may also suggest conclusions vastly different from those drawn by the editors of "the capitalist tool." Chuck Collins of United for a Fair Economy points out that fifty percent of those in last year's top four hundred started their business lives with $50 million in family wealth or by inheriting a large company. That they were able to build skillfully on their assets is clear and is in many cases commendable. But their talents and energy were aided by an initial base that set them apart from more than 99 percent of the U. S. population. If opportunities for success were equally open to everyone, the number of Forbes luminaries born to wealthy parents would be extremely small. Instead, it is striking how few fit the profile of H. Wayne Huizenga, the owner of Blockbuster Video and numerous pro sports franchises. Huizenga started business life with only enough to buy a garbage truck. Since only 43 members of this year's club are new, it is unlikely that further detailed research will yield too many more profiles like Huizenga's. The presence of a few Horatio Alger types hardly obscures the disproportionate presence of inherited wealth on such lists. A few conservatives may still wish to contend that, more than inheriting money, the children of the rich and famous inherit ability. Yet such rejoinders, implied by Herrenstein and Murray in the notorious Bell Curve, run aground on a host of research demonstrating that human abilities are many faceted and are heavily responsive to life long, supportive environments. Close examination of the Forbes material as well as detailed studies of economic mobility conducted over the last decade suggest that equality of opportunity in this nation is at best a sometime thing. Some are more equal than others, even when we are talking about opportunity and not results. Despite progressive taxation of large estates, children of the rich start with enormous financial advantages. The creation of elaborate trusts as well as outright evasion of tax laws leaves these children with very large fortunes at the death of their parents. Even routine reinvestment of these funds and a modicum of financial restraint can often yield exponential increases in their wealth.We surely may take comfort that we are not a caste society, where opportunities are legally limited to those from certain backgrounds or races. Part of our individualist heritage is the opportunity to be rewarded for our talents and energy.Nonetheless, once gaps in family circumstances become extremely wide, some have virtually no chance of success and others can hardly fail. Equality of opportunity is little more than a legal fiction in modern societies without ongoing access to medical care, public education, and adequate food and housing. While the total wealth of the Forbes 400 has grown from 92 billion in 1982 to 624 billion today, the Secretary of Education reports that our schools need over 100 billion just to replace delapidated and substandard facilities.The Forbes 400 provide unwitting testimony to the erosion of equality of opportunity in our society. We pay for this loss in more ways than merely our hypocritical celebration of a vanquished ideal. The talents of many are neither stimulated nor challenged, at great loss not only to our economy but to the future of our democracy.John Buell lives in Southwest Harbor, Maine and writes regularly on labor and environmental issues. He is the author of Democracy by Other Means: The Politics of Work, Leisure, and Environment.