Great Recession

How the 1 percent live

Penthouse parking, a new Versailles, a bat mitzvah bash in Aspen. Salon's guide to the travails of the 1 percent

  • Bankers Struggle at Washing Dishes

    Most of us probably think a $75,000 annual salary is a pretty good deal in a nation where the average household income is far below that. Most of us also probably think that doing one’s own dishes is not a form of economic persecution. But, then, most of us don’t work on Wall Street.

    In a pair of must-reads, New York magazine and Bloomberg News sympathetically quoted financial industry workers complaining about the crushing pain of life on Wall Street in the era of the slightly smaller bonuses.

    The former article quotes an investment banker lamenting that the average $125,000 bonus – which comes on top of an annual salary – is ”only,” after taxes, about “what, $75,000?”

    “My girlfriend likes to eat good food,” he complained. “It all adds up really quick. A taxi here, another taxi there. I just bought an apartment, so now I have a big old mortgage bill.”

    In the Bloomberg piece, Andrew Schiff, who makes $350,000 a year, complains that after renting a second Connecticut vacation house for a full month every year and shelling out $32,000 a year on his child’s elite private school, he now “only” gets to “bring home less than $200,000 after taxes, health-insurance and 401(k) contributions.”

    “I can’t imagine what I’m going to do,” he says. “I’m crammed into 1,200 square feet. I don’t have a dishwasher. We do all our dishes by hand.”

  • 02_ferrari

    Penthouse Parking

    The price of a regular, nondescript parking spot in New York City can be more than a monthly mortgage payment in many parts of America. But simply having a car in a subway-connected city is apparently not enough for some of the super-rich. As the New York Times reports, some of them need to have their car parked on the same floor as their lavish penthouse apartments.

    In the apartment building the Times profiles, domiciles go for $7 million, including a 300-square-foot “en suite sky garage” that “would be valued at more than $800,000 if priced at the same rate per square foot as the rest of the apartment.” No doubt, the view from the garage is so good, the car’s owner can see the vast swaths of the city’s outer boroughs — the places where people are lucky to make $800,000 in their entire lifetimes.

  • 03_capitol
    Wikipedia

    Wanted: More Influence in Washington

    By any honest measure — size of taxpayer bailouts, amount of campaign contributions, number of lobbyists, record of policymaking successes — the financial industry is all-powerful in American politics. When the Street says jump, politicians in both parties ask “how high,” and then typically send a river of taxpayer dollars toward lower Manhattan.

    Somehow, though, this isn’t enough.

    In January, Bloomberg/Businessweek breathlessly touted Wall Street analyst Brad Hintz who insisted that Wall Street isn’t “very powerful at all” in Washington. That was followed up in March, when billionaire hedge fund manager Ken Griffin told the Chicago Tribune that the super-wealthy “have an insufficient influence” over politics, and that his fellow 1 percenters “have a duty now to step up and protect” their power “not for themselves, but for their kids and for their grandchildren and for the person down the street that they don’t even know.” (Note: Griffin almost certainly wasn’t referring to regular middle-class folks. Thanks to gated communities and economically segregated housing patterns, the people “down the street” whom 1 percenters like him “don’t even know” are all but guaranteed to be fellow 1 percenters.)

    Pretending Wall Street is a victim rather than a conqueror is a smart political move: It justifies continued pillaging by America’s financial conquistadors. But implicitly, this particular rhetorical device is a stealthy form of “let them eat cake” trash talk – it rubs the elite’s breathtaking dominance in everyone else’s face. After all, if the financial Masters of the Universe aren’t “very powerful at all” and have “insufficient influence” over politics, what does that say about the sheer powerlessness of us lowly peons?

  • 04_hotel_jerome

    The 3-Day, 94-Room Aspen Bat Mitzvah

    There’s something more than a little gross about renting out an entire Aspen hotel for your kid’s three-day bat mitzvah extravaganza. Especially if you also happen to be a Goldman Sachs executive whose schemes ripped off thousands of people and destroyed Bear Stearns.

    That’s what happened, of course, back in January when Jeffrey Verschleiser rented out Aspen’s Hotel Jerome. As Rolling Stone’s Matt Taibbi notes, Verschleiser “is one of the biggest assholes in the entire world,” having once run Bear’s mortgage-backed securities division.

    “At a time when one in four Americans has zero or negative net worth, renting a 94-room hotel for three days for a tweenager party might already be pushing the edge of the good taste/tact envelope,” Taibbi says. “Even for the most honest millionaire in Aspen, it would seem a little gauche. But for this burglarizing dickhead to do it? It’s breathtaking. I hope he at least invited his bankrupted investors to the pool party.”

  • 05_benson
    AP/Bill Ross
    Bruce Benson

    The Oil Baron Who Hiked Tuition

    Bruce Benson is a wealthy man. He currently serves as the president of Colorado’s university system. The state should have known better, however, than to put a former oilman and Republican Party chairman in charge of its students’ well-being. Recently, he tried to quietly pass a 15 percent tuition increase in expedited fashion so as to avoid media scrutiny. He was in a rush because he knew such attention would uncover his decision to use last year’s massive tuition hike to finance huge bonuses to CU administrators already making big money. He gave one administrator making $340,000 a year a one-year raise of $49,000. In all, Benson devoted a whopping 29 percent of the tuition increase to raises.

    When asked about all of this, he declared, “I’ve never heard a complaint from parents that tuition at CU is too high.”

  • 06_cooperman
    Leon Cooperman

    Toast of the Country Club

    Hedge funder Leon Cooperman recently circulated a screed to his friends on Wall Street decrying President Obama’s “class warfare” against rich people.

    “The divisive, polarizing tone of your rhetoric is cleaving a widening gulf, at this point as much visceral as philosophical, between the downtrodden and those best positioned to help them,” Cooperman wrote – somehow forgetting to mention that Obama refused to prosecute Wall Street crime, supported massive bailouts of Wall Street, cut sweetheart deals to immunize Wall Street from litigation, and shepherded Bush tax cuts for the wealthy through Congress.

    Setting aside Cooperman’s glaring omissions, his sheer paternalism is something to behold. In his world, the super-rich might deign to “help” the “downtrodden” – but only if the downtrodden shut up, get in line and understand that “you’ll get more out of me if you treat me with respect,” as he told Bloomberg News.

    All this condescension has made Cooperman a hero to his peers. Bloomberg tells us that Cooperman “can’t walk through the dining room of St. Andrews Country Club in Boca Raton, Fla., without being thanked for speaking up. … [A]t least four people expressed their gratitude…while he was eating an egg-white omelet.”

  • 07_blankfein
    AP/Charles Dharapak
    Lloyd Blankfein

    Bankers: Heroes of a New Civil Rights Movement?

    Back in 2009, Goldman Sachs CEO Lloyd Blankfein insisted that in foreclosing on homeowners, scamming pensioners and ripping off shareholders, bailed-out bankers are “doing God’s work.” In this portrait of the moral crusader, Wall Streeters are righteous fighters for all that is Right and Good.

    The risk of “God’s work,” of course, is that you may be martyred – a concern deeply felt by J.P. Morgan CEO Jamie Dimon. Appearing on Fox Business in January, Dimon said that criticism of Wall Street represented “a form of discrimination that should be stopped.”

    Between Blankfein and Dimon, the twisted picture is now complete: Wall Streeters aren’t villains – on the contrary, they would have us believe they embody the new civil rights movement and that their critics are the evil Bull Connors.

  • 08_sears
    Reuters/Peter Morgan
    Edward Lampert

    The Sears CEO’s New Versailles

    Any news story that references Versailles in a non-ironic way must be included in Salon’s regular “let them eat cake” feature. As the Huffington Post reports (emphasis added):

    While Sears downsizes and lays off employees, company chairman Edward Lampert is buying a sprawling estate on a semi-private island.

    The billionaire hedge fund manager and chairman of Sears Holdings Corp. is reportedly set to close on a $40 million estate with seven bedrooms and Versailles-style reflection pools on Indian Creek Island, north of Miami. Meanwhile Sears is selling off 1,200 stores and closing 100 to 120 for good, with Florida seeing the most closings of any state.

    In case you were wondering, the Wall Street Journal reports that the $40 million price tag will “set a record for a single-family home in the (Miami-Dade) county.”

  • Recoup at the Ritz

    Hospital bills ruin the financial fortunes of many middle-class Americans, but for the rich a trip to the emergency room can practically be a vacation. As the New York Times reports under the non-ironic headline “Chefs, Butlers, Marble Baths: Hospitals Vie for the Affluent”:

    The bed linens were by Frette, Italian purveyors of high-thread-count sheets to popes and princes. The bathroom gleamed with polished marble. Huge windows displayed panoramic East River views. And in the hush of her $2,400 suite, a man in a black vest and tie proffered an elaborate menu and told her, “I’ll be your butler.”

    It was Greenberg 14 South, the elite wing on the new penthouse floor of NewYork-Presbyterian/Weill Cornell hospital. Pampering and décor to rival a grand hotel, if not a Downton Abbey, have long been the hallmark of such “amenities units,” often hidden behind closed doors at New York’s premier hospitals. But the phenomenon is escalating here and around the country…”

    In other words, as the healthcare crisis gets worse for most people, America’s healthcare system is focusing on a race to Ritz-Carlton-ize hospitals for the richest among us.

  • 10_magazine

    1-Percent Glossy

    With poverty and economic inequality on the rise, you might think that more journalism resources would be devoted to covering those seminal issues. But, of course, you would be wrong. Newspapers, the traditional bastion of journalism focused on the 99 percent, are sadly withering away, and those few that are managing to survive are doing so by focusing more of their content on coddling the rich.

    But it’s one thing for the New York Times to spend precious journalism resources celebrating Manhattan’s 11th-floor car garages and deifying hospitals for the super-rich. It’s an entirely different – and far more “let them eat cake”-ish – endeavor to devote those limited journalism resources to a whole magazine aimed at the 1 percent. But that’s precisely what billionaire Michael Bloomberg is planning with his new magazine called Bloomberg Pursuits.

    Its first edition features a man with not one but two Ferraris and will be “sent to an audience with an average annual household income of more than $450,000,” according to the Times. That demographic represents the “tiny pocket of the print publishing world that is thriving, even as its mass-market counterparts face a slump in newsstand sales.”

    For us 99 percenters, the only good news in the announcement of the magazine is that it won’t be shoved directly in our faces. The publication’s officials told the Times “[the magazine] wasn’t worried that the conspicuous consumption celebrated in the magazine might seem tone-deaf” because “It’s a very closed audience” and won’t be on newsstands.

    Phew.