Behind the News, 9/5/24

🎵

Hello and welcome to Behind the News. My name is Doug Henwood.

The strict constructionist two guests today, though unusually both named Robert.

Robert Pausch will talk about the far-right's victory in German regional elections,

and Rob Larson will look at the super-rich.

Elections in two German states, Thuringia and Saxony,

both part of the former German Democratic Republic,

resulted in strong showings for Alternative für Deutschland, Alternative for Germany.

AFD, as it's known, is a far-right party

with, shall we say, affinities with neo-Nazism.

AFD has been around for over a decade.

Its driving passion is hatred of migrants and a desire to close the borders.

It got about a third of the vote in the two states.

And a new party, founded in January, also had a strong showing.

It's the Bundes-Sahra-Wagenknecht, the BSW.

In English, the Sahra-Wagenknecht Alliance, named after its founder,

an Easterner who emerged from the rubble of its Communist Party.

She's concocted a mix of leftist economic policy

with a heavy dose of close-the-borders,

nativism, though her father is Iranian.

Here with more is Robert Pausch,

a journalist with the German weekly newspaper Die Zeit.

Pausch speaks of Höcke in the interview.

That's Björn Höcke, leader of the AFD in Thuringia,

who got in trouble a few years ago for using the phrase

Alles für Deutschland, everything for Germany,

a phrase used by Nazis that is illegal under German law.

Because he was formerly convicted of an offense for that and fined,

you can call him a fascist without fear of litigation.

Libel laws in Germany are tougher than ours.

Okay?

Here's Robert Pausch.

What drove the vote for Alternativa in those two states?

Is it migrants alone or other factors at play as well?

Well, certainly not migrants alone.

I think, as always, when you talk about the rise of the far right,

the question is, is it the economy or is it cultural issues?

And I think you can make the case for the economy here for some reasons.

In Eastern Germany, the wages are still,

much lower than in the Western part.

The pensions also are much lower.

Public medical service is in pretty bad shape.

And on a more general level, as you certainly know,

Germany's coming from two years of high inflation,

shrinking real wages.

We are facing a recession.

So the economy is obviously not in a very good shape.

And this is like sort of a perfect storm,

I would say.

In the last years, the German economy was doing quite well.

And the share of the vote of the far right was not that high.

This time it changes.

This is the economy part, I would say.

But as always, we have some special cultural issues here,

especially when we talk about Eastern Germany.

We have much higher skepticism towards migration there than in the Western part.

Traditionally, for decades,

even if

there are less migrants or maybe because there are less migrants.

And I would say there is like a specific regional political culture there,

which drives the share of the vote for the radical right.

It's a strange mixture of like the feeling of being superior and deprived at the same time.

It's like the long ways of the transformation,

the post 1990 that drives this.

This feeling and you have some regional narratives,

especially in Saxony where one election was held that they got a very sharp sensorium for like patronizing treated as a child.

This is this is a very strong regional narrative there.

And they perceive the current German government as being patronizing as treating them like a child.

This is like,

I would say,

a set of explanatory variables.

There,

which drives the support of the AFD.

A lot of what you would have just said does explain why the far right is more popular in Eastern Germany than the West,

right?

It's economic problems,

this feeling of being second class citizens being left behind.

That's what makes them more popular in the East and the West,

right?

Yes,

yes.

Yeah,

you got the economic situation in the East and the West is different since decades.

It's narrowing,

but it's still different,

very different.

And one very important point is that in the eastern part of Germany,

you got rural regions with shrinking populations in a much more larger scale than in the western part.

In Germany,

the rural regions are in some parts in the southwest,

for example,

in Lower Saxony,

but also in North Rhine-Westphalia,

strong,

economically strong,

prospering.

But in the eastern part,

they are not.

They are not doing well economically.

And in terms of,

demographic people are going away from there,

especially young women are going away from there.

And this causes the feeling of there is no much hope in the future.

They are despair.

And this is like a very important point there.

Why the eastern part is different than the western part.

Now,

the links party,

the left party used to be strong in eastern Germany,

but its support says collapsed.

What happened to them?

Well,

it's a very complicated and sad story.

Yeah.

As you know,

they were like the eastern part was their stronghold post 1990.

The GDR collapsed,

but the left party remained.

They are the successor of the former communist party there.

And they established at like the voice of eastern Germany.

They were like an anti establishment force for a long time,

which they couldn't hold forever because they were part of local governments,

regional governments and all this stuff.

And in the last years,

there was a huge,

inner party fight between one camp,

which is like more urban,

liberal,

young voter appealing and a traditional camp,

which says we have to be like the voice for the eastern Germany working class guys.

And it was personalized between former head of the party,

Katja Kipping and her very,

very famous opponents,

Sarah Wagenknecht,

which now formed her own party quite successful.

What about the Nazi thing?

I mean,

they play with Nazi symbolism.

They have a network of far right militants and media supporting them.

Just how neo-Nazi are AFD?

Well,

in eastern Germany,

quite neo-Nazi.

There is a ruling from a local judge in Germany,

like you can tell Höcke a fair shift.

Höcke is the leader of the party in Thuring,

which is allowed.

Germany is,

as you know,

is much more regulated,

how you can tell people,

much less free speech.

Free speech than America.

But a judge said it's okay.

It's based on facts.

So Höcke is a real fascist.

He plays with Nazi symbols.

He said the goal for the party was 33%,

which of course is 33,

the year of when the Nazi party came to power in Germany.

And they are deeply,

deeply connected with far right movement activist groups,

which are quite strong in eastern Germany.

For a long time,

they established structures in the 90s,

remain strong since then.

And now like they have a vehicle in the parliament,

which is deeply concerning.

Apart from the anti-migrant positions,

what else does AFD stand for?

What are their social and economic policies more generally?

Well,

very good question.

Their social program is maybe comparable in a way,

I wouldn't stretch it too much,

but in a way comparable to Trump,

the social program is less migrants.

So it's more for you guys,

for you German guys.

There is a wing,

which is quite interesting in the AFD,

also comparable to some of the developments you got there as in the Republican party,

which wants to define in a more intellectual way,

the AFD as the new working class party,

which contains also a program on social issues,

on working class issues.

They are quite strong in the Eastern part of Germany,

but I would say it's not the driving force behind the support of the AFD.

It's in their look and appeal.

It's an anti-migrant close to the border party.

This is the main point,

but they are trying to develop like a social profile.

And the Sarah Wagenknecht party,

they did pretty well for a party that's been around for less than a year.

What are their prospects?

What do they stand for?

There's some overlap with AFD,

but much more progressive on social and economic policies,

right?

They are.

Sarah Wagenknecht is a former communist.

They signed their membership in the former communist GDR party,

the SED,

weeks after the fall of the Berlin wall.

So she comes from there,

deeply rooted in the former communist party and later in the PDS,

in the successor party.

But now she's,

I wouldn't say she's left anymore.

And I would,

I would also not say the term like what you are reading now in many

German or international news left populism fits there.

It's a populist party.

Definitely a populist party.

She's basically hopping from issue to issue,

from issue to issue,

which drives the most media attention.

She's quite a media phenomenon in Germany.

In every second talk show,

she's sitting there.

She's very,

very charismatic in this strange way because she's not like a Tim

Walsh kind of guy.

She's has the appeal of an very upper class person,

which she's not,

but she's charismatic in a way and very strong on these like

cultural war issues.

This is what drives the most energy in her movement.

And she does traditional left social policy,

but it's not in the core of their platform.

It's like they do it,

but the intention,

the,

the whole campaign was structured around the issues,

war in Ukraine,

do peace negotiations,

men in women's sports,

and all these cultural war issues and migration.

And they are doing like anti-German debt break pro higher pensions,

pro higher minimum wage.

They are doing this,

but the attention is on other issues.

And is it mostly a cult of personality or are there other personnel in

the party?

It's basically,

uh,

one person party in a way it's a very,

very interesting party in Germany because we don't normally have these

person centered parties.

The tradition of German parties is they are member parties,

mass parties like German social democratic party formed the whole cosmos

of organizations,

clubs,

social organizations around the party.

They are like micro cosmoses.

And this is like a very,

very different party,

a real to use this.

They,

in his phrase,

a party of new type person center center,

just around very few members.

They are like,

like a club and elitist club in a way is very hard to get

in because they don't want the crazy people inside the party.

And you get like,

I don't know,

50 members in Saxony where they now have to govern and they have 25 members of parliament,

50 party members,

and whole.

I am very curious how this can work out,

but it's very,

very interesting to watch like the formation of a really new party for the political system in Germany.

I'm speaking with Robert Poush,

a reporter of the German weekly.

He did cite that they have to certainly didn't win enough to create a government in these states and the other parties don't want to go into a coalition with them.

So how who is going to govern and how in Saxony?

It's quite clear.

I think they're very interesting.

Crazy coalition,

in fact,

but it's clear what will come next.

It's a coalition between the Conservative Party,

the populist Wagner next party and the Social Democratic Party.

It's messed up,

but it's the only option they have if they don't want to form a government with the AFP.

What nobody does,

even the quite right wing Conservative Party in Saxony doesn't want that in the other stage.

It's,

it's much more,

much more interesting because you don't have a majority of these three parties.

You need the leftist party also,

but this wouldn't work because the Conservatives and the leftist won't go together.

So I'm very curious what will happen there.

Maybe some sort of expert government,

maybe some sort of maybe you find some leftists who will support the government,

but not in a real coalition or not in their,

in their faction.

It's quite,

quite,

quite complicated.

And I'm not seeing how this is going to work out.

And they have to elect a local governor in four weeks.

So clock is ticking.

What is the reaction of the political and business establishment then?

The business establishment has positioned itself quite strong against the AFP,

which is interesting.

German,

German businesses are or CEOs are much more hesitating to,

to traditionally to do a political statement.

But this time they,

they did something for a good reason because I mean,

they,

they need workforces.

As you know,

Germany has a demographic problem.

They need workforces from abroad,

but they don't want to come to states where,

where 30 to 40% are voting for the far right party.

So this is like a,

like a real economic problem for the businesses there.

And you've got some big industries there,

some small industries,

some local small businesses.

This was the reaction before the election was.

And after that they are quite afraid in Thuringia and they are,

they are concerned.

And because,

especially of the political instability there,

right?

I mean like a country or a local,

local state with no stable government is always bad for business.

It would seem that investing in the Eastern part of the country,

bringing the infrastructure and the standards of living up to something like

Western levels would be a good way to fight the AFD.

Is there anybody in the political establishment talking that way?

No,

you're getting to the pain point of German,

political discourse.

We got this funny thing called that break.

I think,

you know what,

what it's about.

It's like basically forbids the federal government,

also the local governments to invest in a broader sense to like,

for example,

fight the recession with like a big public spending program.

We are now in this,

in a situation where we got rising support for the radical right,

recession and the government,

which is unable to do something against it on a fiscal level,

because there is no majority to change this debt break,

this,

this regulation.

There is a huge discussion in Germany about it.

I mean,

not only leftist want to change it,

also conservatives want to change it,

but there's a split in the Conservative Party between those who govern in regional parliaments,

in regional governments.

They want to change it because they see what it's doing.

But on the federal level,

where the Conservative Party is in opposition,

they are saying we don't want to change it.

We will see what it does with the government.

It causes pain for the government.

So it's good for the opposition.

And this is a real mess up situation here,

especially when you,

when you see that it's,

in some reasons,

in some points,

the economy,

which drives the bad economy,

the recession,

which drives the support of the AfD.

What's the German term for the debt break?

Schuldenbremse.

Right,

schuld.

It's guilt as well.

Yeah,

it's guilt.

Yeah,

it's,

it's very German to do this moral link.

Like that is,

is guilt in a way.

It's the same word in Germany.

And it tells us a lot about the German discourse about schuld and schuld.

So guilt and debt.

Oh God.

It's almost the stuff of parody.

Okay,

finally,

there are federal elections next year,

I believe.

What,

if anything,

do these results say about what might be coming up?

I think we have to prepare that the support of the AfD will be stronger than expected,

I would say.

I try to be optimistic in a way.

I would say the federal government is messed right now.

It's a progressive,

a coalition with a conservative liberal party,

which doesn't fit together.

So we have to get rid of it.

There is no other way.

This next year would,

will be painful because we have to watch how they are fighting each other every week,

every day.

And this also will,

will raise support of the AfD because like a government in a bad shape is always a driver for support of far-right party or,

for protest in any ways.

But I would say after that election,

we will get a government where which the Conservative Party in lead or at least in government and that will in a way silence or civilizing the political discourse in Germany because the Conservative Party in Germany is made to govern.

They are nearly always in government and now they are in opposition and you can see that they are going mad.

In this,

they are also a key driver of support of the AfD because they have a huge power in the agenda setting process.

And if they are in government,

they have to handle all the constraints,

all the rules,

all the European rule,

all the message you have to deal with when you're in government.

And my hope is that that will silence,

calm,

regulate,

civilized,

the political,

discourse in Germany a bit at least.

But then,

of course,

as always,

the danger that the mainstream parties will just imitate the AfD in an attempt to steal some of their votes.

This is what we are seeing right now.

And this is like one of the key driver of support of the AfD.

The Conservative Party is imitating the rhetoric,

the Wagenknecht Party also.

And this put legitimacy on what the AfD is saying,

right?

And if you have a Conservative Party,

as we know from the history,

which says clearly,

no,

we won't form a government with them,

and we are not copying their language,

their agenda,

all this stuff,

then support for the radical right will decline.

I hope.

It's like,

you know,

it's a process.

It's a complicated process with media attention.

Again,

the setting from the Conservative Party.

And my hope is in the government,

they will stop copying.

The language and the issues,

because they know how complicated it is to,

in Germany,

to close your border.

I mean,

we are an export driven nation.

Closed borders are the worst thing we could do when we have to get our goods out of the country.

It's,

I mean,

it's basic economy.

You don't have to be that smart to see that.

And my hope is in the government,

they will see that also.

Well,

I hope you're right.

That was Robert Pausch,

a journalist with the German weekly Die Zeit.

My name is Doug Henwood,

and the program is Behind the News,

back after a musical break.

I hope you guys had a good night.

Thank you all for watching.

All of you guys better get out.

Tombstone meets all the day.

See you in the next one.

Good night.

Bye.

Good night.

Bye.

Now some of the second movement of Haydn's string quartet No. 62,

performed by the Kodai Quartet.

It's the theme of the German National Anthem.

The National Anthem is a debased musical genre,

but having one written by Haydn is a remarkable exception.

Next, the super-rich.

Just who are they, where do they get their money, and how do they live?

My next guest, Rob Larson, is just out with Mastering the Universe,

the Obscene Wealth of the Ruling Class,

What They Do with Their Money and Why You Should Hate Them Even More,

published by Haymarket Books.

Rob, whose day job is a professor of economics at Tacoma Community College,

was on this show back in 2018 to discuss his book Capitalism vs. Freedom.

Rob Larson.

Something that's struck both of us, I think,

is the interest that our plutocrats have in launching themselves into space.

Some of us wish it were a one-way ticket,

but this is quite a change from earlier plutocrats like Carnegie,

who built libraries, and Rockefeller, who built museums.

What do you make of this?

Yeah, it's an amazing new, arguably, industry for a very thin layer of clientele.

It stands out, yeah, in a number of ways.

I mean, the first thing I think of,

and one of the first things I mention in the book is,

you know, space programs used to be primarily things

run through public agencies supported by large states.

And now it's...

to the point, with our insane concentration of wealth and capital,

that a small handful of billionaires have their own little,

largely vanity, but partially commercial, personal space programs,

which is an amazing point to have reached.

It's also just really interesting, or just a conspicuous feature of this new,

if we dare to call it, an industry,

is the unbelievable resources footprint that it has.

Even just the most, you know, little vanity, sham, sort of,

PR spectacles that Bezos is, and Musk,

and formerly Richard Branson's space programs put on,

like these short space flights, or when, for example,

Bezos took William Shatner up into the upper atmosphere a little while ago.

Even those very short flights that are less than 15 minutes

emit hundreds of tons of CO2 equivalent.

And just a few minutes in space,

one of these characters can emit more carbon than someone

in the third world will emit in their entire lifetime.

So it really is an incredible emblem of some of the economic features of our era.

And also the lack of any kind of sense of social responsibility.

Building libraries and museums,

even if the fortunes themselves were criminally extracted,

at least shows some degree of social conscience.

It's true.

I mean, the benefits we're to get from this are,

one day, perhaps you'll be able to do space tourism yourself,

or we'll colonize.

There's a moon or a planet,

and one of these wealthy tyrants will be in charge of it.

Not a very appetizing prospect.

Whereas indeed, just classic Carnegie-like philanthropy,

at least there the benefit is manifest to people.

And your hardscrapple family, now you have access to literature,

especially in that era.

It was not a meaningless gesture for all the drawbacks of philanthropy

we also are aware of.

So yeah, it's a real transformation, all right.

Yeah, we don't want to romanticize that old generation too much,

but there is a devolution.

Let's talk about the importance of laying out some basic facts.

Do most people have any idea of how rich these characters are?

That's a really important point.

People are definitely aware that there's new heights

have been reached in some way by people who they see in media,

to the extent they're plugged into things like that,

where they see the incredible fortunes and insane profiles

and giant media entity purchases of these people.

But it's a chronic tendency to

underestimate that wealth concentration, absolutely.

In that first chapter of the book,

I take up the famous Rand study from some time ago,

where they simply asked a nice large random sample of Americans

to estimate what proportions of wealth were held by different quintiles,

different layers of 20% of households in America.

But they drastically underestimated the level of concentration.

And they were also incidentally asked to indicate

what they thought would be an ideal ratio of that wealth.

And it was much closer to,

to Scandinavian countries than the U.S. example.

But it speaks to the fact that while people have that awareness,

that there is a lot of money out there and some people have it,

it's a very nebulous thing.

As Thomas Piketty wrote in his Capital in the 21st Century,

which made such a splash those years ago,

he said that now wealth is so concentrated,

people tend to have sort of ideas that it belongs to surreal

or fantastical entities somewhere in society.

So there's definitely a limited awareness of the real,

uh, contours of it.

Let's talk about the course of this wealth distribution over time.

I can't recall when the term billionaires, plural,

entered common speech,

but it was sometime in the last couple of decades,

the rich haven't always been this rich

or haven't been that rich for a long time.

It's very true.

And, uh, as much as, uh, many of us, including me,

have talked about how we're on the road to approaching

the gilded age heights of wealth and income concentration

in the United States from that late 19th century Rockefeller,

and Carnegie era, it is a stupendous, uh, increase in that concentration.

It's an amazing thing to see.

And indeed it is a relatively recent feature.

It's true.

If you look, uh, at that concentration and that distribution over time, uh,

indeed, if we look at that new deal era, if we can call it that sort of new deal,

great society period from the broadly the 1930s until the 1980s and, uh, the

similar social democracy, heyday, uh, in post-war Europe, that wealth share of rich household,

really does decrease significantly.

Uh, those progressive taxes that people sometimes refer to as being, you know, so high under

Eisenhower and Kennedy's administrations.

I mean, they were very real, uh, for those very high incomes, you would see marginal

rates in the nineties of percents.

So essentially a full confiscatory tax rate for those very, very highest incomes only,

of course, but during that era in the fifties, sixties, and seventies, the heyday of the,

uh, American new deal, regulatory and, uh, tax, uh,

uh, structure, the wealth share.

So the percentage of, uh, the national wealth owned by the wealthiest 10% of households.

In this case, it never does dip below 33%.

Like it does remain a hearty, a strong foundation from which they could, uh, you

know, mount their comeback with the, uh, neoliberal administrations of the eighties.

Yeah.

It's a pretty bracing, uh, piece of literature.

And yeah, as you said, very much, you know, from the, uh, Rand, uh,

corporation, which is very much an establishmentarian, uh, entity.

And basically it's a simple.

Mathematical exercise, just observing that in that, yes.

Uh, long new deal era, broadly speaking, compensation would track economic growth.

Uh, and this was even true across like various, uh, income levels of households

through that period, uh, you know, which is, speaks to the, uh, egalitarian

strengths of that period, such as they were with a stronger labor movement

and progressive taxation and so on.

But all the, uh, study did was simply take that, uh, productivity growth and just see

what American median compensation would look like today.

If it had continued to follow that same trajectory, uh, before the great Reagan

revolution, uh, and it's a change in household income of many tens of thousands

of dollars a year, it's real, real money, certainly for working class people.

Uh, so pretty striking.

Yeah.

And, uh, you know, that money that's not in the pockets of those working class

people, it seems to have reappeared in the offshore bank accounts to the very rich.

Uh, yes, that's right.

Those, uh, mega yachts don't pay for themselves.

Who are these people?

Where does their money come from and just how much do they have?

The first point to me is one of the great questions is, uh, you know, who are these

people, where do they come from?

And there was a section where I sort of go just in a broad outline region by region of

the contemporary wealth landscape and look at who are the wealth concentration pinnacle

households in this region or, you know, in Western Europe or in the Middle East or East

Asia or North America.

And they all have their own fascinating.

Uh, horrifying characteristics being post-Soviet oligarchs or being contemporary European

financiers and conglomerate operators, uh, in the United States.

Of course, these days, uh, it's always been one of the more fluid ruling classes.

I would say the United States famous for it's, you know, a fast changing economy and for

conflicts between, uh, old and new money from, uh, the classic American dramas all the way

through Caddyshack.

We see that pattern, uh, and there, the new.

Of course, this is completely defined by big tech and it's aesthetic and it's VC centered

funding model.

I wouldn't say superseding though, your classic wall streeters after all finance just naturally

takes that position as the sort of cockpit operators of capitalism, deciding where capital

will be allocated and what new industries will get to have resources and which ones

won't.

And those two sectors, I would say, uh, Wall Street and Silicon Valley are sort of defining

today's American wealthy ruling class.

The amount of money is just, uh, stupefying and at the very highest end of people are

aware certainly that people like Bill Gates or Musk have, uh, you know, fortunes in the

high tens or hundreds of billions of dollars, just stratospheric volumes.

If you look at the bulk of these lists of wealthy individuals, like say the Forbes 400

list, for example, it's definitely still finance dominated in a new modes, more hedge fund oriented,

still like the traditional dominance of what is at the end of the day, banking, uh, is

very much still part of it.

And that is where you get these fortunes that really get to those high levels.

Sky's the limit, of course, with money.

Political figures have constitutional limits to their power, but there's no limit to the

natural numbers.

You can stack money indefinitely, so you get a tremendous, tremendous values there.

It's kind of stunning.

One of the frequent justifications for extreme wealth is that it's the reward for

innovation.

But most of our major tech innovations, pharmaceuticals included, have emerged out of public sector

financing over the last few decades.

It is the case.

And I spent a little time looking over that in one of the sections on the book, just on

these very common, very well-worn alibis that people have for justifying the insane concentration

of wealth we see these days.

But it really is the case.

And I quote Andrew Carnegie literally saying, you know, in his writing, pioneering don't

pay, if I recall correctly.

You know, take it from the man himself.

I mean, he got rich on the Bessemer steel process that his workers observed in Britain

and then built his gigantic fortune and then felt like giving us libraries sometimes based

on that.

And certainly with the internet, I mean, the founders of what would become Google talked

about how essential the internet and its open architecture was for their company in its

early days.

Their grad school papers talked about how, on the other hand, commercially-based search

engines would have inevitable conflicts of interest.

Indeed.

We've just been declared a monopolist just a few weeks ago showing that that did indeed

come true.

So that pillaging those public goods is always a big part of this.

And conflicts of interest are their business plan.

Or as one of the star analysts of the 80s who ended up in disrepute said, what used

to be called a conflict of interest is now synergy.

I'm speaking with Rob Larson, author of Mastering the Universe, just out from Haymarket Books.

We've been talking mostly about the US experience, although you did mention some foreign counterparts.

This basic story is repeated all over the globe, isn't it?

Absolutely.

There's a number of places we can turn for this kind of thing.

I've myself gotten pretty attached to the WID, the World Inequality Database, which

listeners really should check out.

They have an excellent website, which is designed for data visualization you can control.

And it includes a number of very illustrious minds in the study of today's wealth gap and

capital distribution.

So Thomas Piketty.

Gabriel Zuckerberg.

Zucman.

Emmanuel Saez.

All your big celebrity names in income distribution empirical research.

And its numbers on these are pretty drastic.

The great thing about their website is they have a separate page almost for every country

in the world.

And it's an interesting exercise just to spend some time looking at countries in a region

or your neighbors and seeing what the concentration of income and wealth looks like in different

class levels and over time.

But indeed.

Usually, you're looking at different variants around a number of roughly 40 or so percent

of that region or country's wealth owned by the richest 1% of households, a middle class

that holds varying amounts from 15 up to 25 or 30%.

And inevitably, with great consistency, a bottom half that's usually in the neighborhood

of 1% to 2% down to negative 1% or 2% using net wealth, of course, and holding debts as

a negative wealth, naturally.

So very similar distributions with a lot of interesting variations, but always somewhat

close to that global average.

Okay.

It's time for a little wealth porn after all this sober analysis.

So how do these people live, their dwellings, their holidays, their seaborne vessels?

Yeah.

In fairly grand style is the answer.

Yeah.

Again, the real estate is a good place to start.

Again, for most middle class people.

Yeah.

The relationship with your home is the defining economic thing in your life.

If someone gets sick or loses the job, oh, will they be able to keep their home or will

they fall behind on the mortgage and lose it?

Wealthy households, you own your homes outright and we're usually not talking about split

levels.

Yeah.

We're talking about often very, very enormous elite penthouses high above your major global

cities, very large estates with often, yeah, very classic mansions.

Personally.

The only real estate resource I always turn to for this is the redoubtable Wall Street

Journal and its mansion section, which still runs in the print edition on Friday, not listed

that way online.

It's just high end real estate there.

But there you can see some incredible, incredible estates that are described.

Yeah.

In fairly pornographic terms indeed as well.

I remember one in particular talking about a renovation of a home out in the Hamptons,

a renovation where they spent $30,000 on a property.

Yeah.

$30,000 on one room on the curtains alone.

I'm sure it's a very attractive window treatment, but I'd rather have a car.

Another one I enjoyed was the description of a huge LA county estate and referred to

quoting here, having 40 rooms or 60 if you include the servants' quarters and the walk-in

silver, fur and wine vaults in the basement.

So pretty fascinating stuff there.

Yeah.

I love these penthouses personally because these are in cities where I have personal

friends like in the great city of New York and the space efficiency of New York renters

is a thing that you really have to admire.

Then you see these enormous penthouses up to and including the all-time record setting

penthouse bought by hedge funder Ken Griffin for almost a quarter billion dollars.

These things, the butler's kitchen, which of course is not the main kitchen, is so much

larger than the entire apartments of many of my New Yorkers.

Yeah.

It's kind of painful to observe that.

Often because it's New York City, they'll come with a parking space.

You can also purchase a parking slot for your car.

Yeah.

Parking spaces in New York City are as expensive as houses and some other places.

They really are.

Yeah.

These high-end buildings, you of course can purchase one to go with your penthouse for

around a million dollars, which is a pretty hardy price point.

But as these guys point out, once you're spending 50 million on your primary residence, the

extra million for parking space is just around a year at that stage, even though it's as

much money as it will take a normal person decades to earn in their regular employment.

That's pretty enjoyable.

I like those.

But whenever it comes to the real estate for these places and their homes, I always specifically

am drawn to the issue of staffing.

You can always go on YouTube at any time and watch modern videos that are sort of successors

to the lifestyles of the rich and famous programming.

But you're just stuck.

Yeah.

You're just seeing the estate and it's emptied out for a photographer or a crew.

Of course, if you have a home this just physically large, let alone as grand as these places

are, the amount of staffing you need is pretty significant.

And again, not to run the business that you nominally are rich for creating.

It's just to operate your home for you.

And it's a fascinating thing to read about.

Of course, there's a section on it in the book.

I always just like a section from the great business journalist, Frank.

Frank Rich, he had a book some time ago on the wealthy households.

It was 20 years ago from like 2001.

So now it seems almost quaint.

But I remember he was describing the work of some young people who were working at a

New York academy to become high-end household service staff.

And just to quote just a tiny bit here from his accounting of this, the students most

of all learn never to judge their employers whom they call principals.

If a principal wants to feed her Shih Tzu braised beef tenderloin steaks every night, the butler

should serve it up with a smile.

If a principal is in Palm Beach and wants to send his jet to New York to pick up a bottle

of Chateau Latour from his Southampton cellar, the butler makes it happen, no questions asked.

That to me is like the real insight into what life is like for these figures.

It's not just you have multiple large homes that you own outright, which itself, I mean,

just imagine owning your home and not having rent or a mortgage too.

You'd sweat over.

But further, you have staff in the home who pay your bills and do your laundry.

It's a small window into a completely different kind of living, no doubt.

Yeah.

I once talked to a guy who'd been a personal assistant for a, I shouldn't name any names,

but he's a finance billionaire who lived just outside New York City.

And he had eight children and eight nannies, one nanny for each child.

And then there was a supervisor.

And then the nanny.

So it worked out there were three layers of management between parents and children.

That's a different kind of lifestyle.

Wow.

It really is.

Yes.

My nephew is about 20 months old and I think my brother would be interested to hear about

having so many management layers between himself and his son, I think.

They also have a thing for art, even though their taste isn't necessarily the most highly

developed.

Yeah, indeed.

And neither is their appreciation for it.

So that is a issue.

Of course.

Of course, that again, as we're seeing so much wealth get concentrated, these people

need places to park their wealth and they park it in real estate assets and they park

it in housing.

And what do you know?

We have what people sometimes call the everything bubble where just assets look bizarrely historically

overpriced wall to wall from finance to real estate to indeed high end art.

Anything that people see as having value essentially can become poker chips for these characters

to hoard and gamble with and speculate on.

And certainly that is painfully the case with some of the world's greatest art heritage

in one of these sources, I forget exactly where I came across this bit, referring to

just some designers who are helping a person of the wealth community decorate their large

yacht and they had purchased this lovely piece and they couldn't fit it easily into the salon

area of the yacht where the owner wanted to hang it.

And the art consultant says, look, it's your piece of wealth.

It's not yours.

It's yours.

You can just hang it however you want.

So they ended up taking a piece that was painted vertically and mounting it horizontally.

They were referred to another case or they took an artist very historically important

piece of art.

And again, it wouldn't quite fit onto I think it was the stairwell area of another large

ship.

And so they cut it to fit.

But to me, the worst part, even then all this, and it is an issue.

I mean, we're talking about boats that are for all their insane value and fancy features.

They're still living areas for these people.

people and their families. And so we have cases where very high value, historically important art

gets breakfast thrown onto it by a kid who's eating in the breakfast because you mounted a

historical treasure in your kitchen. At least there, it's being seen by somebody. So many of

these pieces are seen purely as investment assets that you'll have very important pieces. I remember

there's a piece of Picasso's work a while ago, went on auction at Sotheby's, went for a gigantic

amount to an anonymous online bidder and disappeared after that. And art professionals

assume that it's in some free port somewhere. It's stored in a climate control facility in a

no questions asked free port, like in Switzerland or something like that, where it's just, you know,

someone's poker chips, some important piece of art, and it's in someone's pocket in case they

want to use it to buy something else someday. And now what about the climate impact of these

gangsters? The yachts, the private jets, the multiple houses all over the place. These are

very much...

That's the opposite of a low impact lifestyle, right?

Yeah. And it is brutal watching conservatives try to manipulate this real fact. And they'll

talk about how when you have climate conferences, you'll have celebrity supporters of,

you know, environmental action who travel there on private jets, which is fairly disgusting. And

plenty of high wealth people like to affect an attitude of conscience on this issue. But they

will take, you know, private flights, you know, private, personally owned or collectively owned,

like condos.

Condominium style. Private aircraft, which is a pretty stupendous indication of the wealth of the,

excuse me, emissions footprint of these households. Yeah. Again, going with the WID,

the World Inequality Database's numbers, because they do a great amount of work on

emissions distribution as well as with dollars. And they find that globally, the wealthiest 1%

of households emit 17% of the world's CO2 equivalent by itself. The richest 10% of

households emit 47.6% of the total, almost half in those 1 in 10 households. Pretty stupendous.

And there are a lot of reasons for that. But transportation is a very big enduring one.

That certainly includes these private planes, which again, you know, if you're buying a

personally or family owned Gulfstream, I mean, those things can cost up to a billion dollars

or more depending on the features, of course. But those private jets are so painful, of course,

because of their incredible emissions inefficiency measurements that we have for this,

industry are that the emissions per mile for private jets are about 10 times what they are,

even for commercial flights. Just stupendously, stupendously high numbers,

especially because of the specific characteristics of their use. I think it was

Transportation and the Environment is a UK NGO that has done a little bit of research on this.

And their estimate is that within the European Union, private jet use, 41% of the flights

are empty legs.

Where it's just a pilot or a crew. And you're flying to Monaco, where the boss has told you to

fly his empty individual emissions farting plane. And you will pick him up there and take him to

the Adriatic or Paris or wherever. Just a stupendously flagrantly wasteful industry.

And again, also based on very disproportionately short flights as well. And many of us got a

personal taste of this. If you were following that fun account on Twitter,

MeanX, the ElonJet account, looking at Musk's flights, which you can still do,

they're just lagged by a day because of his personal freak out on the issue.

But there we see a number of flights that are less than an hour. And some literally from,

as I recall, San Jose to San Francisco, flying a private jet within the bay.

That's like a half hour trip on the BART. And you're flying a private jet, which is, of course,

even more inefficient because the highest emissions periods on a flight naturally are

takeoff and landing.

Especially stunning in that way. And that's just looking at the jets. If you look at the yachts,

it's even more disgusting. Some of those very largest yachts, if they're over 180 feet from

bow to stern, we call those mega yachts now. Those things with all their insane features,

some of them burn 100 gallons of diesel an hour standing still before it pulls out.

It's pretty amazing to look at the footprint of these characters. And especially, yeah,

throw in what we began with,

with the global footprint from elite novelty space travel. It's even more amazingly lopsided. So

I have very much a mirror image of their hoarded wealth is their hoarded emission power.

And I always like to conclude with a what is to be done note. Expropriating these characters

would be a lovely political enterprise. It seems very, very difficult, though. I mean,

we kind of know what to do, but figuring out how to do it, it seems to be the challenge right now.

Indeed.

Definitely do make a swing for that exact point there of expropriation as being so important

historically. Like we mentioned a moment ago, not that long ago, these wealthy households were

merely wealthy instead of stinking rich because of our progressive tax structure,

because of the importance of labor unions giving those working class households some

share of the economic growth, at least, that they create, which is nice. But all through that New

Deal period and through the heyday of European social democracy, I mean, with some exceptions,

especially,

transportation and energy, mostly private property remained private for all of the

regulatory structure. It got foisted upon it. Private firms still own the national media and

individuals do today. They own the great productive capital of society, the manufacturing

plants and agricultural estates and oil refineries and data centers, the great physical capital that

makes society work and for all of its flaws that keeps it operating day by day. Ownership of those

assets represents such a position of power in

society.

I argue in the book, and of course, many leftists would agree with this, fundamentally, this is why

the rich were able to mount such a comeback in the 80s and 90s with neoliberalism and those

administrations was because they retained ownership of their institutional wealth, not just their cash

and bank accounts and real estate, but their ownership of physical capital through stock or

direct family ownership. So that expropriation, taking that capital away from them and socializing

it through nationalization, that's why the rich were able to mount such a comeback in the 80s and

90s.

So the rich were able to mount such a comeback in the 80s and 90s.

And I like an experimental attitude. There's probably many ways to expropriate the boss that we could

embrace. But as you said, getting to that is sort of the great obstacle. Being in America, we have a

country that is sort of politically less inclined towards collective solutions, at least when they're

presented in the ways they normally are. When people hear about popular socialist policies like

Medicare for all, or at least reformist ones like that, they get stupendous support. But it's, you

an uphill battle to get people to listen on socialism. And I have a section talking about

ways you can try to do that. You can refer to great figures like Einstein and Orwell and Martin

Luther King who had real support for socialism. That's a great way to be the tip of a spear for

your liberal relatives when you're raconteuring with them. But fundamentally, we have a lot of

political education and certainly, as I also talk about in the book, labor organizing in front of

us to build up a movement that would be in any way approaching the stature to mount some sort of

successful political and labor-based expropriation program, capitalizing, one would hope, with large

general and sit-down strikes to ratify and to prevent the bourgeois from weaseling out of such

policies there. So a lot of clear steps indeed, organizing unions, moving our political education

forward, but it's been and will be a long road, I think. That was Rob Larson, author of Master

in the Universe, just out from Haymarket Books. The guy I quoted saying, what used to be conflict

is now a synergy, whose name I couldn't remember, was Jack Grubman, a Solomon Smith Barney analyst

who had a direct financial interest in the firms he was supposedly writing objective reports on.

As I was preparing this segment, I came across a story from the Banger Daily News

about Las Vegas casino tycoon and former Ultimate Fighting Championship CEO

Lorenzo Fertitta, who has two Megayachts docked in Portland. The larger one, at 285 feet,

is Fertitta's main vessel. The second, 217 feet, is mainly used to house all his expensive toys,

as the paper puts it, five smaller boats, an array of jet skis, and a set of four wheelers

for use on land. All that and a crew of 20. The two yachts together cost around $200 million

and take about $20 million a year to maintain. That's it for me, Doug Henwood. Let's go out

with this, some of, yes, ACDC, who has some thoughts on money. Till next week, bye.

You're a Frenchman, foreign ship, a big house, with king size bed.

You had enough, you ship them out. The dollar's up, down, you better buy the pound.

The claim is on you, the stocks are on me. So what do you do? That's guaranteed.

Hey little girl, you break the laws. You have sold your deal.

You steal from my soul. Come on, come on, let me hold the money.

Come on, come on, listen to the money talk. Come on, come on, let me hold the money.

Come on, come on, listen to the money talk.

Money Talks!