Editorial

FORBES 400 WORLD SERIES

It's that time of year again, when rich people feel downright middle class compared with people even richer. Why, if you have to ask the price of a Learjet 31A, you can't afford one ($5,775,000). It took a net worth of $475 million to get on this year's Forbes 400 lineup of the ultra-rich, up from $415 million in 1996. Oprah Winfrey, ranked 343rd with $550 million, is the only black person on the team.

The estimated combined wealth of the Forbes 400 increased 31 percent, from $477 billion in 1996 to upwards of $624 billion this year. When Forbes introduced the first 400 in 1982, their combined net worth was $92 billion. Today, that wouldn't even field a Forbes Five. While the average worker barely kept up with inflation last year, the richest American, Microsoft billionaire Bill Gates, more than doubled his net worth, from $18.5 billion to $39.8 billion. It would take the median U.S. household earning $35,500 some 600,000 years to make as much as Bill Gates did last year. He is worth more than the G.N.P. of Central America.

Today the United States has 170 billionaires by Forbes's count, up from 135 last year, and more than 36 million people living below the official poverty line--and millions more living in poverty above it. The latest poverty thresholds are $7,995 for a single person and $12,516 for a family of three. According to the Census Bureau, the top 5 percent of households (with income above $119,540) increased their share of the national income from 15.6 percent in 1981 to 21.4 percent last year; the bottom 80 percent lost ground to those above. The top 5 percent has an even larger share of national wealth, holding about 60 percent of all net worth, according to economist Edward Wolff.

Forbes celebrates bootstrappers, but its 400 are better represented by Jim Hightower's remark about George Bush, "He was born on thrid base and thought he hit a triple." (Steve "Flat Tax" Forbes can relate. The Forbes family is conspiciously abstent from the 400, but Fortune pegged inheritor Steve's personal wealth at $439 million in 1996, enough to make that year's cut.) "Born on Third Base," a new study by the Boston-based United for a Fair Economy, shows that a majority of the Forbes 400 inherited their way onto the list, inherited already substantial and profitable companies, or received key start-up capital from a family member.

• 42 percent were born on home plate. These include older dynasties like the Rockefellers and du Ponts, and newer family fortunes from companies like Walmart and Gap. The Waltons of Wal-Mart are ranked nine through thirteen on the Forbes 400, with a combined $32 billion. Forbes thinks some of those born on home plate hit a home run. For example, it calls Philip Anschutz "self-made" even though he would have made the 400 cut just from the mineral wealth he inherited from his father.

• At least 6 percent were born on third base. They inherited wealth in excess of $50 million or a large and prosperous company, and grew this initial fortune into Forbes 400 size. For example, Edward Johnson III inherited Fidelity from his father and led it the mutual fund world series.

• At least 7 percent were born on second base. They inherited a medium-sized business or wealth of more than $1 million or received substantial start-up capital for a business from a family member. Examples include poultry tycoons Donald Tyson and Frank Perdue.

• At least 14 percent were born on first base. For example, Bill Gates's parents were well-off professionals and he went to a private school where he and Microsoft co-founder Paul Allen began their exploration of computers.

Nike founder Phil Knight was born in the batter's box and hustled his way to number 17 on the Forbes 400 with $5.4 billion. But the high-priced Air Jordans that bring such profits aren't self-made: The typical Nike worker is an Asian girl or woman working in a sweatshop for less than $10 a week. Forbes comments, "An unrepentant Phil Knoght blasts his sweatshop critics: 'This isn't an issue that should even be on the political agenda today. It's just a sound bite of globalization.'"

Rich Americans have been scoring off workers' sacrifice flies for decades. It's time to give workers their fair share at bat.

HOLLY SKLAR AND CHUCK COLLINS