Greed at a Glance
A weekly update on avarice in America and beyond

January 5, 2009

The worldwide economic meltdown has so far sliced the fortunes of Britain’s 1,000 wealthiest by just over half, reports the Times of London. But the UK’s richest still hold at least £200 billion in wealth, or about $290 billion. British high-rollers seem to be making do in their newly constricted circumstances. Sportswear tycoon Sir Tom Hunter, for instance, has seen his personal fortune shrink to under $1.1 billion. Announces Hunter: “I am tightening my belt like everybody else. Yes, I still have the private jet, but we have sold our house in the south of France.” That belt-tightening isn't impressing UK lawmakers like MP Michael Meacher. He's calling on Britain’s Labor Party government to up taxes on high incomes more than the 5 percentage-point hike the government is already seeking. Says Meacher: “The ultra-rich, whose wealth has grown astronomically over the last three decades, should now make their contribution.”

In South Florida, the legions of designers and event planners who owe their livelihoods to the upper-crust set are breathing a sigh of relief. The super rich are still spending — at least, as one local wedding planner noted last week, on “the big emotional events.” Indeed, points out Bruce Sutka, a top exec with a West Palm Beach event-staging firm, his company has one affair upcoming with a $225,000 budget just for decorations. Dream Concierge, another South Florida event planner, is now putting together a $500,000 black-tie spring wedding. The 130-guest bash will feature $110,000 worth of filet of beef and lobster tail and “a canopy of 12-foot-tall birch trees draped with hanging orchids.” Smiles a satisfied Breeze Taylor, a planner with Dream Concierge: “In these circles, people want their guests to be wowed and surprised.”

Meanwhile, up in Aspen, the super rich aren’t spending — at least not on homes that list for over $10 million. High-end sales in this Colorado ski resort have dropped over 40 percent since 2007, and Aspen realtors went into December with a record 79 unsold properties in the double-digit millions. Among them: a $43.8 million residence that comes with seven bedrooms and 16,000 square feet, over six times the size of the standard American home. The local realtor hawking the $43.8 million sale, notes the Aspen Times, is staying optimistic. A buyer, explains realtor Kelli Gardner, “could come tomorrow.” Adds the defiant realtor: “I’m not buying into that negativity.”   

George W. Bush invaded Iraq. What locale should our new President invade? David Cay Johnston, the Pulitzer Prize-winning former New York Times tax analyst, has a suggestion: the Cayman Islands. This Caribbean outpost may now be the world’s top tax-avoidance haven for America’s wealthy. Enron parlayed Cayman hospitality to billions in payouts, and the hedge funds that played footsie with Bernie Madoff’s Ponzi fraud have Cayman connections, too. The United States, says Johnston, should be demanding that Cayman officials “make available all records on American-related entities and individuals.” And if they don’t? Send in the Marines, says Johnston, along with plenty of auditors. Quips Johnston: “The Caymans has no military, only about 300 cops, so marching up the tourist-laden beaches should be a breeze.”

America’s 22 most prestigious elite institutions of higher education, National Association of College and University Business Officers research revealed last year, hold more endowment wealth than the entire rest of the 785 schools the business officers are currently tracking. But this enormous concentration of endowment wealth hasn’t created more seats for students from lower-income families. In fact, over the last decade, undergrad enrollment at the Ivies, MIT, and Stanford has actually dropped. Who is benefiting from the largely untaxed billions in elite university endowments? The biggest beneficiaries may be the financial advisers universities hire to manage their endowment investments. In the last fiscal year, Bloomberg news reports, five managers of Harvard’s endowment — higher ed’s largest — pocketed a combined $25.9 million.