IPS report documents missing millions as Massachusetts state legislature fails to act on Boston’s luxury transfer tax.
This year’s all-stars of avarice range in age from thirty-somethings to nearly octogenarian status. They’re all doing their best to keep our world a staggeringly unequal place.
By Sam Pizzigati
How has the United States become so unequal? We need to look for answers, first and foremost, in our society’s underlying economic and political realities, at the policies and practices that let wealth concentrate — at the top — so intensely.
But we also ought to look at people, the real-life flesh-and-blood characters who make decisions that privilege the few over the many. These greedy souls love the shadows. Let’s shine some light — on this year’s greediest of them all.
May the greed we spotlight here help inspire the rest of us to do as much as we can, in 2015, to make our world a much more equal place.
10/ Paige Laurie Dubbert: Walmart Wealth
Paige Laurie Dubbert, the granddaughter of Walmart founder Sam Walton’s brother and business partner, is charging wage theft. The gent she wedded six years ago, says a Dubbert divorce filing, schemed to pay himself and a friend $70,000 a month to run her retail center for Southern Cal’s super rich.
The rather obvious irony here: Few firms over the years have feasted more off wage theft than Walmart.
This past spring, the company agreed to a $21-million settlement in a wage theft lawsuit in California. Labor attorney Theresa Traber handled the case. Retail giants like Walmart, she says, “use middlemen to hire workers in their warehouses to evade wage and hour laws.”
In 2012, cheated U.S. workers overall took in $280 million in backpay for wage-theft violations, almost twice what robbers grabbed for the year from banks, gas stations, and convenience stores.
Paige Laurie can look forward to inheriting far more than $280 million someday. Her mom and aunt are currently sitting on $6 billion worth of Walmart shares.
9/ Ken Langone: Zip It, Pope
This 79-year-old venture capitalist began 2014 making headlines with his advice for Pope Francis. The pontiff, Ken Langone told New York’s archbishop, should cool it on the inequality front. Papal broadsides against “the powerful feeding upon the powerless,” Langone went on to pronounce, may leave America’s wealthy “incapable of feeling compassion for the poor.”
Langone himself has always been a generous sort. As a New York Stock Exchange director, he greased the skids for a $190-million exit package for his buddy, NYSE president Richard Grasso, in 2003.
Langone has been a bit less generous to the powerless. As a director at Yum! Brands, the home of Taco Bell and KFC, he cheered on company efforts to oppose hikes in the minimum wage.
Langone has always enjoyed railing against government regulations like our wage minimum. As he likes to put it: “Leave us alone and let us hire people.”
Home Depot, the retail giant Langone’s financing helped propel to big-box dominance, shows what happens when you leave corporations alone. Big-box giants, notes the research group Good Jobs First, don’t create jobs. They “grow mostly at the expense of existing competitors,” many of them local businesses.
Big-box giants, on the other hand, do create massive concentrations of personal wealth. Forbes now estimates Langone’s net worth at $1.6 billion.
8/ Dennis Jones: Doing Good Comfortably
Some people do good volunteering in homeless shelters. St. Louis mega millionaire Dennis Jones says he does good sailing the seas on his brand-new $34 million yacht.
How’s that? The millions spent on his yacht, Jones told an interviewer earlier this year, kept a shipyard in business. And the $170,000 he spends every month keeping his boat ship-shape, Jones adds, funds paychecks for a 10-person crew.
Jones retired in 2000, after selling his pharmaceutical business for $3.4 billion, and now spends his terra firma time at a St. Louis mansion over 12 times the size of a typical new American home.
Between the manse and his yacht, Jones says, he and his wife enjoy the “same level” of luxury “wherever we go.”
Jones says he also does good outside yachting. His favorite charity? Maybe Junior Achievement, “because it teaches children about free enterprise.”
7/ Micky Arison: Miami’s Biggest Winner
Pro basketball, the Miami Heat owner Micky Arison likes to say, only has one winner at the end of each year. But in business, he adds, “we can all be winners.”
Workers and customers at Arison’s prime business, the Carnival cruise ship empire, might beg to differ. Maritime lawyer Jim Walker dubs Arison “hands down” the greediest executive in an exceptionally greedy industry.
Cruise lines like Carnival, notes Walker, incorporate abroad to sidestep U.S. taxes, labor laws, and safety regulations. They then “pay dirt cheap wages,” with minimal benefits, to the workers from developing nations they have staffing their ships.
Carnival of late has ratcheted up the squeeze on workers. Over the past two years, the cruise line has terminated retirement programs for Filipino workers, snatched tip income from staff hired in Mumbai, and fired 150 waiters who dared to protest. Such tactics have helped up Arison’s personal fortune over $6 billion.
Earlier this year, the 65-year-old Arison started cashing out chunks of his Carnival shares at about the same time passengers left adrift last year on a faulty Carnival ship were testifying in a lawsuit against the company.
That incident subjected over 4,200 passengers to five days of overflowing toilets and rotting food. Carnival is calling the subsequent passenger lawsuit “an opportunistic attempt to benefit financially” from “alleged emotional distress.”
The Miami Herald recently asked Arison to share the secrets of his success. Replied the Bal Harbour billionaire: “There is no substitute for hard work.”
Or the right genes either. Arison’s daddy Ted founded Carnival in 1972.
6/ Jay Dweck: High-Tech Happiness
Banker Jay Dweck has made enough on Wall Street, working for Goldman Sachs and Morgan Stanley, to afford to live in a $4.8 million home an hour’s drive north of Manhattan. But Dweck has dreams that go beyond scoring big in high finance. His current vision? Dweck wants “to improve quality of life using technology.”
How does Dweck propose to do that improving? He’s pioneering new technology to make life sweeter — for the 1 percent.
And the guinea pig for this new technology? Dweck himself! He’s now spending $3 million on new-tech renovations of his home and another $3 million on projects that involve the amenities on his estate’s grounds.
Dweck’s master bathroom will soon feature a TV by his whirlpool tub, another facing his toilet and bidet, a shower nook for a third TV, and a fourth screen across from his bathroom sink. All the TVs will turn on automatically whenever someone steps near them.
Dweck’s estate also features a violin-shaped pool that sports 440,000 hand-laid individual glass tiles and 5,600 fiber-optic cables. The tiles light up like multicolored Stradivarius strings, in time with Dweck’s favorite music.
Live Better Systems, a company Dweck set up this past May, will be marketing similar high-tech marvels to his fellow awesomely affluent, once all the kinks get worked out.
5/ Phil Knight: Just Do It, Ducks!
The University of Oregon Ducks will be playing for the national football championship this January, and no Oregon fan will be quacking more fervently than class of ’59 alum Phil Knight. But the billionaire Nike chairman does a lot more than just cheer for his dear Ducks.
Knight spent a reported $68 million on a three-building “Performance Center” for Oregon football, a plush temple to touchdowns that boasts 64 55-inch TVs in the main lobby and a weight room floor crafted from Brazilian hardwood.
In gratitude, the university’s football brass have set aside a locker in the facility’s space-age locker room for “Uncle Phil.”
Each locker comes with plenty of room and its own ventilation system. But Knight has storage needs that even the largest locker can’t possibly handle. That’s why he’s paying $7.6 million to construct a hangar for his personal $64.5-million Gulfstream private jet.
With a $22.4 billion fortune, Knight can afford to buy — and store — anything he could possibly covet. But his Nike corporate empire still can’t seem to afford to provide workplace decency for the company’s huge outsourced workforce.
Back in the 1990s Nike tried denying this workforce’s subminimum wages and horrible working conditions. Then the company reversed field and vowed to become a model employer.
But that highly touted turnaround, political scientist Richard Locke concluded last year, remains a “disappointment.” Nike and Knight are still profiting mightily off factories suffering “from persistent problems with wages, work hours, and employee health and safety.”
4/ James Mitchell: The Torture Doc
Last week’s release of the long-awaited U.S. Senate Intelligence Committee report on CIA torture tactics after 9/11 has made Dr. Jim Mitchell and his partner Dr. Bruce Jessen the world’s most notorious psychologists. The report details the pair’s role as the architects of the CIA “enhanced interrogation.”
“I’m just a guy who got asked to do something for his country by people at the highest level of government,” an unrepentant Mitchell has been telling reporters, “and I did the best that I could.”
That service to his country appears to have been something less than selfless. Mitchell, New York magazine notes, saw early on that the post-9/11 world would provide “business opportunities” for someone with his Air Force background in prepping pilots for the brutal interrogations they might face if captured.
Mitchell promptly corralled “his old friend Jessen,” and the pair convinced CIA officials they could get al-Qaeda detainees to talk.
Mitchell and Jensen, the Senate torture report reveals, had no experience conducting interrogations or any specialized knowledge about counterterrorism. But they had a great sales pitch — and soon found themselves orchestrating tortures that ranged from waterboarding to standing detainees on broken limbs.
The tortures would make Mitchell a small fortune. His initial hourly consulting fee ran four times the CIA going rate for interrogations. Between 2005 and 2009, after the CIA outsourced the bulk of its interrogation work directly to a consulting company that Mitchell and Jessen had set up, the pair collected $81 million.
The CIA, Reuters notes, has so far shelled out another $1 million to protect Mitchell and Jessen from any legal liability for their barbarous work. Mitchell, now living a sunny life in Florida, last week called the Senate report “a load of hooey.”
3/ Paul Singer: Wall Street’s Top Vulture
Hedge fund billionaire Paul Singer has built his personal fortune practicing what the wags on Wall Street like to call “vulture investing.” He snaps up the bonds of economically distressed nations at “next to nothing,” then flexes his fortune to force those nations to pay him far more than what he paid.
One result: Instead of building schools, the Congo ended up paying Singer $127 million for Congolese debt he acquired for $10 million.
In Argentina, a government elected in 2003 convinced over 92 percent of the investors holding the old government’s defaulted bonds to accept partial payment. But Singer refused to go along.
The Wall Street kingpin then set up a front group to lobby in Washington and found a federal court that eventually ruled in his favor. Earlier this year, the U.S. Supreme Court refused to hear Argentina’s appeal. Singer originally paid $49 million for Argentinian debt. He now stands to collect as much as $832 million.
Argentina is still battling to stop Singer’s financial “extortion.” Early in December, Singer shot back against that resistance. Argentina, he charged, “has elevated a commercial dispute” into “a dispute about national dignity.”
2/ Travis Kalanick: Getting Uber Rich Quick
What a year for the CEO and co-founder of Uber, a taxi-like service that lets travelers hail cars through a mobile phone app. Back last January, Uber was running cars in just 60 cities. The current total: 250 cities — in 50 countries!
That growth has Uber now worth $40 billion, more than the value of long-established transportation heavyweights like Hertz and United Continental. Not bad for a company, the Associated Press notes, “that didn’t exist five years ago.”
The 38-year-old Kalanick himself, Forbes estimates, is ending the year personally worth a cool $3 billion.
How has Uber soared so quickly? The company is pumping up profits, critics charge, by taking short cuts like not running adequate safety background checks on drivers. Officials in L.A. and San Francisco have just filed suit against Uber on driver safety checks, and governments from Spain to India have also taken legal action against the company.
Other critics include customers like Leah Kappen of Indianapolis. She took an Uber ride downtown to the December 6 Big Ten football championship game. That ride cost her $30. The 18-minute trip home after the game cost her $450. This past Halloween, an 18-mile-ride home ran New Yorker Elliott Asbury $539.
Uber’s “surge pricing” — a policy that keys rates to the market demands of the moment — generated these outsized fees. The riders these fees upset, says Kalanick, need to start “getting used to dynamic pricing in transportation.”
Uber drivers are complaining, too. One of Uber’s competitors, the Lyft service, gives the extra profit from “surge pricing” all to its drivers. Uber takes a 20 percent cut. Why not, the Wall Street Journal asked Kalanick, follow suit?
“We are a business,” he replied.
1/ Larry Ellison: Owning Everything
Year in and year out, Larry Ellison pulls down more compensation than any other corporate CEO in the United States. He topped the list for 2013 with $78.4 million. He’ll likely top the list for 2014 as well. He grabbed $67.3 million for the year, his Oracle software company announced in September.
Ellison will definitely not top the CEO pay list next year. The reason: In September, Ellison stepped down as Oracle’s chief exec, a slot he has filled since he started the company over three dozen years ago. But Ellison hasn’t quite retired yet. He’s now serving as Oracle’s “chief technology officer.”
Ellison also still holds about a quarter of Oracle’s shares, a stash that brings his net worth to $50.6 billion, enough to make him the world’s fifth-richest person.
In residences owned, Ellison may well rank as the world’s numero uno. This past March, a business publication took a shot at cataloging the homes and other properties Ellison has collected over the years. He has, notes Business Insider, “all but taken over entire neighborhoods in Malibu and the Lake Tahoe area.”
Ellison’s big-time collecting started back in 1988 when he picked up a $3.9-million home in San Francisco. He would later spend nine years recasting a 23-acre estate further down the San Francisco peninsula into a $70-million faux 16th-century Japanese emperor’s palace.
Ellison owns a real-life Japanese palace, too, a historic $86-million garden villa in Kyoto. And don’t forget his $10.5-million mansion in Rhode Island’s Newport or his $42.9-million golf estate in California’s Rancho Mirage. Or the $500 million he shelled out two years ago to buy 98 percent of the Hawaiian island of Lanai.
Ellison, to be sure, has interests that go beyond real estate. He likes yachts. He currently has two, each over half as long as a football field.
[toomuch_promo]Ellison also likes to play basketball, even on his yachts. If a ball bounces over the railing, no problem. Ellison has a hired hand in a powerboat following his yacht, reports noted this past spring, “to retrieve balls that go overboard.”
Sam Pizzigati edits Too Much, the Institute for Policy Studies online weekly on excess and inequality. His latest book: The Rich Don’t Always Win: The Forgotten Triumph over Plutocracy that Created the American Middle Class (Seven Stories Press).