F. Scott Fitzgerald was right when he declared the rich different from you and me. But today’s super-rich are also different from yesterday’s: more hardworking and meritocratic, but less connected to the nations that granted them opportunity—and the countrymen they are leaving ever further behind.
IF YOU HAPPENED to be watching NBC on the first Sunday morning in August last summer, you would have seen something curious. There, on the set of Meet the Press, the host, David Gregory, was interviewing a guest who made a forceful case that the U.S. economy had become “very distorted.” In the wake of the recession, this guest explained, high-income individuals, large banks, and major corporations had experienced a “significant recovery”; the rest of the economy, by contrast—including small businesses and “a very significant amount of the labor force”—was stuck and still struggling. What we were seeing, he argued, was not a single economy at all, but rather “fundamentally two separate types of economy,” increasingly distinct and divergent.
This diagnosis, though alarming, was hardly unique: drawing attention to the divide between the wealthy and everyone else has long been standard fare on the left. (The idea of “two Americas” was a central theme of John Edwards’s 2004 and 2008 presidential runs.) What made the argument striking in this instance was that it was being offered by none other than the former five-term Federal Reserve Chairman Alan Greenspan: iconic libertarian, preeminent defender of the free market, and (at least until recently) the nation’s foremost devotee of Ayn Rand. When the high priest of capitalism himself is declaring the growth in economic inequality a national crisis, something has gone very, very wrong.
Read the full article here. Read more articles from the January/Feburary 2011 issue of The Atlantic here.
“As an example, she described a conversation with a couple at a Manhattan dinner party: ‘They started saying, “If you’re going to buy all this stuff, life starts getting really expensive. If you’re going to do the NetJet thing”’—this is a service offering ‘fractional aircraft ownership’ for those who do not wish to buy outright—‘“and if you’re going to have four houses, and you’re going to run the four houses, it’s like you start spending some money.”’
“The clincher, Peterson says, came from the wife: ‘She turns to me and she goes, “You know, the thing about 20″’—by this, she meant $20 million a year—‘“is 20 is only 10 after taxes.” And everyone at the table is nodding.’”