A Look at the Numbers: How the Rich Get Richer
News: How the rich get richer.
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IN 1985, THE FORBES 400 were worth $221 billion combined. Today, they’re worth $1.13 trillion—more than the GDP of Canada.
THERE’VE BEEN FEW new additions to the Forbes 400. The median household income has also stagnated—at around $44,000.
AMONG THE FORBES 400 who gave to a 2004 presidential campaign, 72% gave to Bush.
IN 2005, there were 9 million American millionaires, a 62% increase since 2002.
IN 2005, 25.7 million Americans received food stamps, a 49% increase since 2000.
ONLY ESTATES worth more than $1.5 million are taxed. That’s less than 1% of all estates. Still, repealing the estate tax will cost the government at least $55 billion a year.
ONLY 3% OF STUDENTS at the top 146 colleges come from families in the bottom income quartile; only 10% come from the bottom half.
BUSH’S TAX CUTS GIVE a 2-child family earning $1 million an extra $86,722—or Harvard tuition, room, board, and an iMac G5 for both kids.
A 2-CHILD family earning $50,000 gets $2,050—or 1/5 the cost of public college for one kid.
THIS YEAR, Donald Trump will earn $1.5 million an hour to speak at Learning Annex seminars.
ADJUSTED FOR INFLATION, the federal minimum wage has fallen 42% since its peak in 1968.
IF THE $5.15 HOURLY minimum wage had risen at the same rate as CEO compensation since 1990, it would now stand at $23.03.
A MINIMUM WAGE employee who works 40 hours a week for 51 weeks a year goes home with $10,506 before taxes.
SUCH A WORKER would take 7,000 years to earn Oracle CEO Larry Ellison’s yearly compensation.
ELLISON RECENTLY posed in Vanity Fair with his $300 million, 454-foot yacht, which he noted is “really only the size of a very large house.”
ONLY THE WEALTHIEST 20% of Americans spend more on entertainment than on health care.
THE $17,530 EARNED by the average Wal-Mart employee last year was $1,820 below the poverty line for a family of 4.
5 OF AMERICA’S 10 richest people are Wal-Mart heirs.
PUBLIC COMPANIES spend 10% of their earnings compensating their top 5 executives.
1,730 BOARD MEMBERS of the nation’s 1,000 leading companies sit on the boards of 4 or more other corporations—including half of Coca-Cola’s 14-person board.
THE BIDDER who won a round of golf with Tiger Woods for $30,100 at a 2004 Buick charity auction could deduct all but about $200.
TIGER MADE $87 million in 2005, all but $12 million from endorsements and appearance fees.
THE 5TH LEADING philanthropist last year was Boone Pickens, in part due to his $165 million gift to Oklahoma State University’s golf program.
WITHIN AN HOUR, OSU invested it in a hedge fund Pickens controls. Thanks to a Katrina relief provision, his “gift” was also 100% deductible.
LAST YEAR 250 COMPANIES gave top execs between $50,000 and $1 million worth of wholly personal flights on corporate jets.
THIS PERK is 66% more costly to companies whose CEO belongs to out-of-state golf clubs.
THE U.S. GOVERNMENT spends $500,000 on 8 security screeners who speed execs from a Wall Street helipad to American’s JFK terminal.
UNITED HAS CUT the pensions and salaries of most employees but promised 400 top executives 8% of the shares it expects to issue upon emerging from bankruptcy.
UNITED’S TOP 8 execs will also get a bonus of between 55% and 100% of their salaries.
IN 2002, “turnaround artist” Robert Miller dumped Bethlehem Steel’s pension obligation, allowing “vulture investor” Wilbur L. Ross to buy steel stock and sell it at a 1,000% profit.
IN 2005, DELPHI HIRED Miller for $4.5 million. After Ross said he might buy Delphi if its labor costs fell, Miller demanded wage cuts of up to 63% and dumped the pension obligation.
10 FORMER ENRON directors agreed to pay shareholders a $13 million settlement—which is 10% of what they made by dumping stock while lying about the company’s health.
POOR AMERICANS spend 1/4 of their income on residential energy costs.
EXXON’S 2005 PROFIT of $36.13 billion is more than the GDP of 2/3 of the world’s nations.
CEO PAY AMONG military contractors has tripled since 2001. For David Brooks, the CEO of bulletproof vest maker DHB, it’s risen 13,233%.
AT THE $10 MILLION bat mitzvah party Brooks threw his daughter last year, guests got $1,000 gift bags and listened to Aerosmith, Kenny G., Tom Petty, Stevie Nicks, and 50 Cent—who reportedly sang, “Go shorty, it’s your bat mitzvah, we gonna party like it’s your bat mitzvah.”
FOR PERFORMING IN the Live 8 concerts to “make poverty history,” musicians each got gift bags worth up to $12,000.
OSCAR PERFORMERS and presenters collectively owe the IRS $1,250,000 on the gift bags they got at the 2006 Academy Awards ceremony.
A DOG FOOD COMPANY provided “pawdicures” and other spa treatments to pets of celebrities attending the 2006 Sundance Film Festival.
ONE OF MADONNA’S recent freebies: $10,000 mink and diamond-tipped false eyelashes.
PARIS HILTON, who charges clubs $200,000 to appear for 20 minutes, stiffed Elton John’s AIDS benefit the $2,500-per-plate fee she owed.
ACCORDING TO Radar magazine, Owen Wilson was paid $100,000 to attend a Mercedes-Benz-sponsored Hamptons polo match. When other guests tried to speak with him, he reportedly said, “That’s not my job.”
-- Clara Jeffery (Ed.)
Next issue: Why the poor stay poor
Illustration: Stephen Savage
