Wealth and Power

America has succumbed to a vicious cycle in which great wealth translates into political power, which generates even more wealth, and even more power.

This spiral is most apparent in declining tax rates on corporations and on top personal incomes (much in the form of wider tax loopholes), along with a profusion of government bailouts and subsidies (to Wall Street bankers, hedge-fund partners, oil companies, casino tycoons, and giant agribusiness owners, among others).

The vicious cycle of wealth and power is less apparent, but even more significant, in economic rules that now favor the wealthy.

Billionaires like Donald Trump can use bankruptcy to escape debts but average people can't get relief from burdensome mortgage or student debt payments.

Giant corporations can amass market power without facing antitrust lawsuits (think Internet cable companies, Monsanto, Big Pharma, consolidations of health insurers and of health care corporations, Dow and DuPont, and the growing dominance of Amazon, Apple, and Google, for example). 

But average workers have lost the market power that came from joining together in unions.

It's now easier for Wall Street insiders to profit from confidential information unavailable to small investors.

It's also easier for giant firms to extend the length of patents and copyrights, thereby pushing up prices on everything from pharmaceuticals to Walt Disney merchandise. 

And easier for big corporations to wrangle trade treaties that protect their foreign assets but not the jobs or incomes of American workers. 

It's easier for giant military contractors to secure huge appropriations for unnecessary weapons, and to keep the war machine going.

The result of this vicious cycle is a disenfranchisement of most Americans, and a giant upward distribution of income from the middle class and poor to the wealthy and powerful.

Another consequence is growing anger and frustration felt by people who are working harder than ever but getting nowhere, accompanied by deepening cynicism about our democracy.

The way to end this vicious cycle is to reduce the huge accumulations of wealth that fuel it, and get big money out of politics. 

But it's chicken-and-egg problem. How can this be accomplished when wealth and power are compounding at the top? 

Only through a political movement such as America had a century ago when progressives reclaimed our economy and democracy from the robber barons of the first Gilded Age.

That was when Wisconsin's "fighting Bob" La Follette instituted the nation's first minimum wage law; presidential candidate William Jennings Bryan attacked the big railroads, giant banks, and insurance companies; and President Teddy Roosevelt busted up the giant trusts.

Bernie Sanders's presidential campaign is part of this mobilization.

Land(s) of Opportunity

According to Forbes and for 2015, the top 50 wealthiest people in the world come from the following countries with the net worth ranging from $79.2 Billion to $18.1 Billion:

• United States
• Mexico
• Sweden
• Hong Kong
• Brazil
• Canada
• France
• Spain
• Saudi Arabia
• China
• Italy
• Japan
• India
• Germany

Actually, there are over 1000 Global Billionaires living in the world today and while a majority of them are from the USA, there are numerous Billionaires throughout the world; in fact, if we dropped net worth down into the hundreds of millions, then the list would quite possibly expand to 20+ times the number of Billionaires.

So, what can we extrapolate from this piece of information?

One no longer has to immigrate to the US in order to have the opportunity to become rich...

Having the opportunity to become rich is what lured many immigrants into the US for years; and, even though most of those immigrants never realized their dreams here in the US, they did bring with them the technical skills and abilities that put the US on the top of all the manufacturing companies in the world... and, in so doing created the “illusion” that the US was the place to go if one wanted to be successful.

That “illusion” lasted until about 1975 +/- and the slowly started to evaporate and disappear, yet, thousand of immigrants still poured into the US with the hopes of becoming successful... and, many did, at least they were more successful here than they might have become had they stayed in their respective countries.

However, it was not just the opportunity of success that lured immigrants, but the US had a better “quality of life,” better healthcare, better education, and many more “freedoms” than the rest of the countries of the world. But, by 2000, the US no longer held all those distinctions but still immigration persisted and continued to grow because the rest of the world perceived it differently.

I can recall in the early and late 1990's when my wife and I went on 2 different Caribbean Cruise, both times we stopped at Jamaica and both times the Jamaicans perceived that all Americans were rich and could not understand why we were not spending more money buying souvenirs and could not fathom the concept that my wife and I were trying to be careful in terms of how we spent our money. Some Jamaicans were so persistent in their attempts to get us to spend money that they were oftentimes perceived by us as being down right rude.

Of these top 50 global billionaires, below is a list of what areas of the marketplace provided them with so much wealth:

1. Computer software
2. Telecommunications
3. Stock Investments
4. Clothing & accessories
5. Investments
6. Retail stores
7. Cosmetics
8. Luxury Goods
9. Online Sales
10. Social Media
11. Casinos
12. Online Search Engine
13. Ball bearings
14. Candy
15. Media
16. Beer
17. Real Estate
18. e-Commerce
19. Tennis shoes
20. Supermarkets
21. Solar Power Equipment
22. Oil & gas
23. Eye glasses
24. Dish network
25. Pharmaceuticals
26. Computer hardware

This list is not really that impressive as it pretty much just describes what we use everyday like tennis, shoes, cosmetics, clothes, telephones, food, gasoline, and computers. Of course, Bill Gates and Microsoft are at the top of the list but how often does a Windows Operating system come around and rides the tidal wave of computer and internet growth? Not often at all...

And, Zuckerberg and Facebook are on this list as well but again this social media idea just happened to be the first one out of the gate just as the internet was catching on... and, there are many companies that are similar to Facebook that are ranked in the hundreds of millions category which is not a bad place to be either.

With the advent of the internet, online sales or e-commerce, companies have access to the entire world at their fingertips which is something that has never before been experienced and as the various global cultures grow, their residents are going to want the same types of good and services that Americans have enjoyed for over 50 years.

And, it is because of this global marketing that multimillionaires will stop appearing all over the globe and the US will no longer be considered the only Land of Opportunity.

So, let share this little scenario with you...

In the early 1990's, I worked with a company that had part of its manufacturing operations in Mexico and the workers were initially receiving a $1/day in wages plus free meals, transportation, and daycare.

This wages was more than these workers were getting before but as they started to buy more stuff with these extra monies, they demanded more money and so their wages increased to $1/hour plus free meals, transportation, and daycare. However, since they were now buying more new stuff than they had ever had before, they demanded more money and so their wage increased to $5/hour plus free meals, transportation, and daycare.

Each time the wage went up, the company had to increase its selling price in order to keep profits at a consistent level, put the company was still able to sell all the products that were being manufactured in Mexico.

Those Mexican workers who started working for this American company and continued to work for this American company were able to not just change their lifestyle but were able to increase their quality of life and had soon moved out of poverty and into Mexico's lower Middle Class.

I mention this story because the second wealthiest person behind Gates is a Mexican gentleman called Carlos Slim Helu who made his money in telecommunications because as Mexicans were able to pull themselves out of poverty (like my example) they purchased telephones and other telecommunications devices and products which ultimately resulted in Carlos becoming a very wealthy man.

So, it is no longer just the US where a Land of Opportunity can be found... in fact, I would suspect that this opportunity can be made available to anyone, anywhere as long as they are dedicated, patient, creative, and has a “keen eye” for what their neighbors might need.

Also, bear in mind, that many of the billionaires did not reach that level overnight... many of them “stayed the course” for 20-30 years before their accumulated wealth grew that large... and, many of them did not start out with the idea that they were going to become billionaires, they started because they liked the idea of what it was that they wanted to do.

For instance, Sam Walton (before he died a billionaire) worked at a retail store as an employee and saw many ideas that this store was not incorporating with their business, so he decided to start a retail store that offered those ideas. He had good hunches because as his store grew, he was able to open up other stores but never strayed away from his initial ideas. Sam Walton had only an elementary school education and yet he built one of the largest chain of stores in the world. But, it took him all his life to become the wealthiest man in the world... even though that never really was his goal.

And, that is how you get there and now this opportunity is available to damn near everyone and anyone regardless of where they were born or might be currently living. The world (not just the US) is a land of opportunity if that is what you want it to be. The only thing that is holding you back is YOU.

Rich Club Expands

They call it the Richie Rich Club, and it is about to get even richer. India's wealthiest will quadruple their net worth in the next four years, a report says, with hundreds of thousands of new entrepreneurs and inheritors becoming multimillionaires.

The survey, based on interviews with 150 ultra-high net worth individuals, comes amid signs of returning business confidence in the world's biggest democracy.

Recent years have seen lackluster growth, rising prices of basic foodstuffs and a weakening currency. 

But the Bharatiya Janata party (BJP) won a landslide victory in May on a pledge to reinvigorate the ailing economy.

Despite the slowdown, there are now nearly a sixth more Indians worth in excess of $3.75m (£2.2m) than just one year ago, the report for the Kotak Mahindra bank notes.

"Cities are mushrooming, the middle class population growing, opportunities have increased substantially and the political environment has improved greatly in recent months," according to Murali Balaraman, a co-author.

Between them India's rich hold assets worth a trillion dollars, which is around a fifth of the total wealth in the country. Within four years, that total is likely to reach $4tn (£2.3tn), the report says, making three times as many people multimillionaires.

Serving the new rich – and the old money – is a booming luxury market.

"They really want to show or talk about their wealth in a really subtle way, and consumption of luxury goods is a nice way to do it," Balaraman said.

Abhay Gupta, the CEO of brand consultancy Luxury Connect, said the market for top end goods and experiences would "only get bigger".

"There is a huge aspirational class who look up to what the very wealthy are doing and then copy it," he said.

Cars are among the most popular items bought, the report says. Whereas five years ago locally made SUVs were shown off by the wealthy, now only foreign cars will turn heads. Mercedes saw a 47% surge in sales in India last year. BMW launched a new $200,000 (£117,700) model in Delhi this week.

Winkelmann said Lamborghini's Indian customers were much younger than those in Europe, with a typical buyer being in his 30s. However, the most popular investments remain real estate – mainly within India – and jewelry.

India's super-rich have long raised eyebrows around the world with their spectacular spending. Mukesh Ambani, the country's wealthiest man, has built the world's most valuable home in Mumbai, the commercial capital.

The 27-storey tower, complete with helicopter pads, indoor cinemas and a staff of more than 600, is worth an estimated $1bn (£500m).

The attraction of the imported whisky was that no one who attended the wedding would find out how to source the same drink in India, the report adds.