The Top of the One Percent (2014)

Book Review from the March 2014 issue of the Socialist Standard

Plutocrats: the Rise of the New Global Super-Rich by Chrystia Freeland  (Penguin £9.99.)

Chrystia Freeland has no objection to the current social system and those who benefit from it: ‘we need capitalists, because we need capitalism’, she writes. And she is now a Liberal MP in Canada. But her book does have some interesting things to say about the very wealthiest people in society and the increase in inequality. 

It is quite common nowadays to refer to the 1 percent who form the top of the class pyramid. But even within this 1 percent there is a distinction between a plutocratic super-elite (which is overwhelmingly male) and those who are ‘merely wealthy’. In 2005, for instance, Bill Gates and Warren Buffett had a combined wealth of $90bn, not far short of that of the 120 million people who formed the bottom 40 percent of the US population. In 2008, the top 2 percent of the 1 percent in Britain, which must be only about ten thousand people, received almost one-seventh of the income of the 1 percent. The super-elite set up ‘philanthropic’ foundations, such as the Gates Foundation, as status symbols.

Also, the higher echelons of the elite mostly operate at a truly global level, with English as their lingua franca. Its members may have been born in one country and educated in another (quite likely at a university such as Harvard or Oxford). They may own a multi-national company with its headquarters in a third country and have homes on two or three continents. So possibly the biggest capitalists are becoming less tied to particular countries and identify less with a national capitalist class. But many of them make sure to attend top British social events, such as Ascot and Wimbledon.

More controversially, Freeland claims that many plutocrats are the ‘working rich’. They are chief executive officers or top bankers or lawyers, rather than just people who own masses of shares. Though few come from truly impoverished backgrounds, their enormous wealth is not inherited, so they are supposedly ‘self-made men’. They mostly work in newish industries such as computing or other kinds of technology, or else in finance. Perhaps it is more accurate to say that these ‘alpha geeks’ often had some idea for a website or a piece of software, but they were just lucky in getting into a position where they could exploit others, and that is what really made them so fantastically wealthy.

So Freeland’s book does have some interesting things to say on ways in which capitalism is changing, and on how it is not.

Paul Bennett