By Frank Ahrens
Washington Post Staff Writer
Friday, September 22, 2006
It's not news that Bill Gates is the richest person in America, according to Forbes magazine's annual list of the nation's 400 richest people, released yesterday. He has been for 13 years. Barring a second Stone Age in which computers are good only for hurling at other cavemen, Gates will always be rich.
The news is: On this list, $999 million is chump change.
For the first time, all 400 Gotbucks on the Forbes tally are billionaires, from Gates (worth $53 billion) down to the bottom, Los Angeles semiconductor magnate Sehat Sutardja ($1 billion).
It's not just the accumulated wealth that draws attention to the list; it's the eye-popping numbers that show the speed with which wealth is gained -- and lost -- at the dawn of this millennium. For instance, according to Forbes:
· Casino mogul Sheldon Adelson (No. 3, $20.5 billion) has made $1 million per hour over the past two years.
· Google Inc. founders Sergey Brin (No. 12, $14.1 billion) and Larry Page (No. 13, $14 billion) have each made $13 million per day over the past two years.
· Martha Stewart dropped off the list after losing nearly $400 million over the past year.
Forbes has been publishing the much-ballyhooed list -- which relies on research and estimates and rounds net worth to the nearest $100 million -- since 1982. The inaugural list contained only 13 billionaires. Even after the technology crash at the beginning of the century, a three-year war and a jumpy economy, the wealth accumulation among the richest Americans continues unabated and has risen to historic proportions, even if measured by an arbitrarily arrived-at number (400, the number of swells who could fit into the Victorian New York ballroom of Caroline Astor).
"It is a really big deal that it's all billionaires," said Forbes associate editor Matthew Miller, who edited the list and led the team that spent a year compiling it. "It shows economic growth and, as this magazine is a fan of capitalism, it shows progress."
The list of D.C. billionaires is topped by Danaher Corp. founder Mitchell P. Rales (No. 107, $2.6 billion), followed by his brother, Steven M. Rales (No. 117, $2.5 billion), new Washington Nationals owner and real estate mogul Theodore N. Lerner (No. 242, $1.5 billion), and Black Entertainment Television founder Robert L. Johnson (No. 374, $1 billion). McLean candy czar Forrest E. Mars Jr. is Virginia's top billionaire (No. 21, $10.5 billion), while Richard E. Marriott is Maryland's wealthiest man (No. 197, $1.8 billion).
The enormous sums spur the natural question: Is it good, bad or neither that wealth is accumulating so fast that numbers begin to lose their meaning? (Requisite illustration: A stack of 1 billion $1 bills would reach a height of 80 miles.)
On the one hand, the fortunes have spawned a new age of philanthropy, by which private individuals can try to effect change with the power and reach of a government but without the bureaucratic shackles that often thwart aid efforts.
Bill and Melinda Gates, for instance, created a foundation with assets of $30 billion that focuses much of its effort on improving health for the world's poor. Warren E. Buffett (No. 2, $46 billion), a director of The Washington Post Co. along with Melinda Gates, said in June that he would give away much of his fortune to charity, most of it to the Bill & Melinda Gates Foundation. The gestures recall the large-scale largesse of 19th-century capitalists named Vanderbilt and Rockefeller.
Yet not everyone finds the billionaire boom beneficial.
"I think it's very bad," said Dean Baker, a macroeconomist at the Center for Economic and Policy Research in Washington. "If the U.S. had experienced really extraordinary growth, then maybe that would be the reason" for all the billionaires. Baker pointed out that U.S. economic growth in the past 25 years -- the period that hatched this crop of billionaires -- is actually slower than in the preceding quarter-century, which produced only 13 billionaires.
"If these people pull away so much wealth," he said, "that means everyone else has less."
The growth in the number of billionaires has been significantly aided by cuts in U.S. tax rates that allow the wealthy to keep more of their money, said Harvard University economics professor Larry Katz. Today's marginal tax rate for the richest Americans is 35 percent, down from more than 60 percent 25 years ago.
"We could do a lot more with the tax system and with policies . . . to help out those who are less fortunate," Katz said. On the other hand, "not every dollar that goes to a rich person is taken away from someone else."
Katz is of mixed mind about the billionaire boom.
"At one level, it leads to the possibility of great philanthropy," he said. "On the other level, it is a great concentration of wealth and power that can subvert other people's interests."
One-third of the Forbes 400 is concentrated in two places: California, which has 89 billionaires, and New York City, with 44.
The billionaire-free states are West Virginia, Vermont, Alaska, Maine, Delaware, Mississippi, Iowa, New Mexico, Kentucky and North Dakota. (South Dakota has one.) Even Wyoming, the least populous state, has a billionaire -- Christy Walton (No. 7, $15.6 billion), one of eight Wal-Mart family members on the list, four of whom are in the top 10.