at Zappos is free lunch, and many of the parents who work there, at a call center starting salary of $11.50 an hour, told me they made a point of eating their main meal at work to spare their family grocery budget.
At Zappos, where everyone wears jeans and no one has an office, the chasm between the top and the bottom is as sharp as it gets. This paradox of an egalitarian culture coexisting with extreme economic and social inequality is a crucial and often overlooked part of the relationship between the super-elite and everyone else.
Most of today’s “working rich” plutocrats didn’t start out hugely privileged. And many of them operate in worlds—Silicon Valley and also the trading floors of Wall Street and its service firms such as Bloomberg, where one of the biggest corporate faux pas is to demand an office—in which the cultural dividing lines between the tribunes and the hoi polloi are intentionally blurred. But, of course, even if the billionaire is in a T-shirt and drives his own car, his universe is very different from that of a call center worker. Below is an exploration of what the plutocrats think of the rest of us.
THE BILLIONAIRE IN BLUE JEANS
Pittsburgh was one of the smelters of America’s Gilded Age. As the industrial revolution took hold there, Andrew Carnegie was struck by the contrast between “the palace of the millionaire and the cottage of the laborer.” Human beings had never before lived in such strikingly different material circumstances, he believed, and the result was “rigid castes” living in “mutual ignorance” and “mutual distrust” of one another.
The twenty-seven-story Mumbai mansion of the Ambani family, rumored to have cost a billion dollars, is just seven miles away from Dharavi, one of the world’s most famous slums, and the gap between these two ways of life is even wider than anything Carnegie could find in the Golden Triangle. So, for that matter, is the difference between Bill Gates’s futuristically wired 66,000-square-foot mansion overlooking Lake Washington, which is nicknamed Xanadu 2.0 and whose library bears an inscription from
Even so, the correct etiquette in today’s plutocracy, particularly among its most admired tribe, the technorati of the U.S. West Coast, is to downplay the personal impact of vast wealth. In April 2010, when MIT students asked him how it felt to be the richest person in the world, Bill Gates suggested it wasn’t a very big deal. “Well, the marginal return for extra dollars does drop off,” Gates said. “I haven’t found any burgers at any price that are better than McDonald’s.” He admitted there were some great perks, like flying on a private jet, but said that after a “few million or something, it’s all about how you’re going to give it back.”
If you traveled to Mountain View to visit Eric Schmidt when he was CEO of Google, you would have found him in a narrow office barely big enough to hold three people. The equations on the whiteboard may well have been scribbled by one of the engineers who works next door and is welcome to use the chief’s office whenever he’s not in. And while it is okay to have a private jet in the Valley, employing a chauffeur is frowned upon. “Whereas in other cultures, you can drive your Rolls-Royce around and just sort of look rich and have a really good time, in technology it’s not socially okay to have a driver who drives you to work every day,” Schmidt told me. “I don’t know why, but you’ll notice nobody does it.”
This egalitarian style can clash with the Valley’s reality of extreme income polarization. “Many tech companies solved this problem by having the lowest-paid workers not actually be employees. They’re contracted out,” Schmidt explained. “We can treat them differently, because we don’t really hire them. The person who’s cleaning the bathroom is not exactly the same sort of person. Which I find sort of offensive, but it is the way it’s done.”
When he was CEO of Bain Capital and building his current net worth of about $200 million, Mitt Romney drove a Chevrolet Caprice station wagon with red vinyl seats and a beaten-up fender. Carlos Slim’s trademark look is slightly scruffy casual wear, and he loves to tell journalists he doesn’t own any homes outside his native Mexico. But even when he dresses down, a billionaire inhabits a world apart. A little more than a decade ago, I asked Mikhail Khodorkovsky, at that moment the richest man in Russia (and, as it happens, also someone who favored casual clothes and lived in a modest house), what he thought of the rest of us. “If a man is not an oligarch, something is not right with him,” Khodorkovsky told me. “Everyone had the same starting conditions, everyone could have done it.” (Khodorkovsky’s subsequent experiences—his company was appropriated by the state in 2004 and he is currently in prison for fraud and embezzlement—have tempered this Darwinian outlook: in jail cell correspondence he admitted that he had “treated business exclusively as a game” and “did not care much about social responsibility.”)
This worldview is straight out of the pages of Ayn Rand, but Khodorkovsky told me his uncompromising position was based not on literature but on life experience. During the 1998 Russian financial crisis some of his non-oligarch minions had made mistakes that had cost Khodorkovsky hundreds of millions. With hindsight, he blamed himself—they weren’t oligarchs, therefore something was wrong with them, therefore they shouldn’t have been trusted to make such big decisions.
Remember the line about Bjorn Borg, of whom Ilie Nastase said, “We’re playing tennis, he’s playing something else”? The extreme self-confidence you hear in Khodorkovsky’s comment is partly the product of believing you have an extreme aptitude for making money, one that is probably largely independent of time and circumstance.
The robber barons felt that way, too. “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.”
If you have that special talent, you have a special regard for others who possess it, too. Khodorkovsky trusted only fellow oligarchs. Steve Schwarzman thinks they are likely to make good presidents. “We ended up making twenty-four times our money” from a joint investment, Schwarzman told Bloomberg TV when asked why he had decided to host a fund-raiser for Mitt Romney’s presidential bid at his triplex home at the storied apartment building at 740 Park Avenue. “In finance, that’s the way to make friends.”
The flip side of that high opinion of fellow plutocrats can be a lack of sympathy, shading sometimes into disdain, for everyone else. For the super-elite, a sense of meritocratic achievement can inspire self-regard, and that self-regard—especially when compounded by their isolation among like-minded peers—can lead to obliviousness and indifference to the suffering of others.
Eric Schmidt, the chairman of Google, admitted to a journalist in December 2011 that no one in his world thought much about Occupy Wall Street and the discontent of the 99 percent. “We live in a bubble,” he said. “And I don’t mean a tech bubble or a valuation bubble. I mean a bubble as in our own little world…. Companies can’t hire people fast enough. Young people can work hard and make a fortune. Homes hold their value.” What is striking about those remarks is that the unemployment rate in Santa Clara County, where Google’s Mountain View campus is located, was 8.6 percent, slightly higher than the national average. And some of the most violent and controversial Occupy demonstrations were in Oakland, a forty-five-minute drive from Schmidt’s office.
Matt Rosoff, a business journalist based in San Francisco, argues that even in Silicon Valley, the epicenter of the West’s second gilded age, Schmidt’s perspective reflects the particular experience of the 1 percent. “I recently talked to an IT engineer at a midsize financial services company downtown and he complained that his budget is being slashed every year, as he’s expected to do more with less,” Rosoff wrote on his
The plutocratic bubble isn’t just about being insulated by the company of fellow super-elites, although that is part of it. It is also created by the way you are treated by everyone else.
One financier, speaking about his friend who is one of the top five hedge fund managers in the world, said, “He’s a good man—or as good as you can be when you are surrounded by sycophants.” A few days after Dominique Strauss-Kahn’s arrest on accusations of assaulting a hotel maid in New York, I happened to share a car with a U.S.
