May 21, 2007
You consider yourself a thoughtful, caring person. So what should you care about most in our world today, our globe’s grotesquely unequal distribution of income and wealth or the escalating extinction rate among our Earth’s endangered species?
A team of Canadian environmental scientists has just made that choice easier. If you want to protect our world’s flora and fauna, their new research advises, start standing up against inequality. We have more in this week’s Too Much.
Also in this week’s issue: A Republican Presidential candidate muses about plutocracy and the political process.
Why are American soldiers fighting in Iraq? To stop terrorism? To spread democracy? We now have a new objective for the war: 
to help Iraq end its desperate shortage of luxury hotel rooms. Earlier this month, officials in Erbil, the capital of Iraq's Kurdish region, welcomed a U.S. business delegation and assorted other dignitaries for the groundbreaking on a new five-star luxury hotel complex, the region’s “most serious foreign investment project” since the Iraq war started. Pronounced the keynoter for the day’s festivities, Kurdistan region prime minister Nechirvan Barzani: “Projects such as this are our response to the destructive activities of terrorists. Whatever they do, they cannot stop our progress.”
The Iraqi commitment to quality hotel accommodations will no doubt come as welcome news to David Lesar, the CEO of Halliburton, the giant Pentagon contractor. Lesar announced last week, in Houston, that he’ll shortly be taking up residence in the Middle East, as part of a Halliburton headquarters shift to Dubai. Halliburton is angling, with the shift, to get more Middle East business. The region has already been quite good to Halliburton. The company’s federal contract revenue has over quintupled since 2000, thanks largely to the war in Iraq. Lesar has done well, too. In one recent three-year period, notes a new CorpWatch report, Lesar's Halliburton shares and options gained over $49.5 million in value. Lesar, in those same years, pocketed millions more selling shares from his personal stash. In one sale last year, he collected $49.9 million . . .
The realtors at Coldwell Banker Morrison have a travel tip that may keep you from sitting — and sweltering — in traffic this summer on the way to the beach. Just buy your own private island. Coldwell now has 180 ocean pearls available. The priciest, Vatu Vara in the Fiji chain, carries an $80 million price-tag. Need to vacation closer to home? Private Islands Online is offering two little Caribbean gems — a combined 640 acres — for just $48 million. Not every American, of course, can afford a private island. Not every American, notes the Center for Economic and Policy Research, even vacations. A quarter of all U.S. private-sector workers, says a new Center report, get no paid vacation or holiday time whatsoever. Of the world’s 20 most prominent developed nations, only the United States fails to guarantee workers vacation days. In 17 of these nations, all workers — by law — get at least 20 paid days off . . .
The luxury goods world market, industry experts are predicting, will hit $215 billion this year. One reason: Companies that specialize in luxury goods are expanding their traditional product lines. Versace is leading the way. The firm recently introduced a ceramic-based leather chair that carries a $51,800 price tag and now offers customized luxury interiors for Agusta Westland helicopters and Lamborghini motorcars. The 20 special edition Lamborghinis prepped by Versace have already sold out — at $475,000 each. The world's financially favored, says Versace CEO Giancarlo Di Risio, want to express their “lifestyle" with more than “handbags and shoes.”
The gap between Moscow’s rich and poor is rising, the city's stats agency reports, and a leading Russian Orthodox prelate isn’t happy. Moscow’s most affluent 10 percent is now taking home 41 times more annual income that the city’s poorest 10 percent. In Western Europe, by contrast, this ratio is running six to eight times. Metropolitan Kirill, an official with the Russian Orthodox Moscow Patriarchate, says his country needs progressive taxes that “should apply to really rich people’s incomes.” Moscow, he notes, may host more “Rolls-Royces, Maybachs, Lamborghinis, and Ferraris” than any other city in the world. Adds the church leader: “If somebody pays $580,000 for his Maybach, and even more enjoys himself decorating its leather seats with gold and diamonds, we should simply help such a person to share some his money with the poor.”
Quote of the Week
“The story of private equity is the incredible wealth being created for the small number of individuals at the top," Service Employees union president Andy Stern, testifying before the House Financial Services Committee, May 16, 2007
i
New Wisdom
on Wealth
Dedrick Muhammad and Chuck Collins, Race, Wealth, and the Commons. Poverty & Race, May-June, 2007. An exploration into the mythology behind the creation of private wealth.
The top-tier contenders for the 2008 Republican and Democratic Presidential nominations, a group that includes both a person of color and a woman, may look more like the rest of America than any crop of top contenders in American history.
But this group certainly doesn’t live like the rest of America. The leading GOP and Democratic candidates, disclosure statements filed last week make plain, all boast fortunes that dwarf the holdings of average American families.
The richest of the bunch: former Massachusetts governor Mitt Romney, whose personal assets, a campaign adviser said last week, may total over $250 million. Romney has parked as much as another $100 million in a blind trust for his kids.
Romney’s fortune comes from his two decades wheeling and dealing in the private equity industry. Arizona Senator John McCain owes his family fortune, worth somewhere between $20 and $32 million, to his wife’s status as “an heiress to a major beer distributor.”
The current GOP frontrunner, former New York mayor Rudy Giuliani, left public office six years ago worth no more than $1.8 million. Since then, Giuliani has turned his 9/11 fame into fuel for a 24/7 personal money-making machine. His current stock and business interests may total as much as $70.4 million.
On the Democratic Party side, Senator Hillary Clinton appears to be sitting on the largest family financial nest-egg, but that won’t be clear until this summer, when the disclosure filing extension Clinton requested expires. Previous disclosures have placed the Clinton family fortune at between $10 and $50 million.
Clinton rival John Edwards, the former North Carolina senator, currently holds assets worth $29.5 million, his campaign said last week. Senator Barack Obama’s holdings, over and above the value of his personal residence, range between $500,000 and $1.1 million.
That total puts Obama in the second tier of Presidential candidates, as ranked by financial wealth. He’s currently the only candidate from this wealth “second tier” who has made his way into the “first tier” of serious contenders.
And that shouldn’t surprise anyone, former Arkansas governor and current GOP Presidential candidate Mike Huckabee — net financial worth: between $350,000 and $900,00 — observed last week.
“The only reason that some people are first tier is that they have a whole lot of money,” Huckabee noted. “If that’s what the presidency is about, we’re moving toward a plutocracy, not a presidency.”
New research, published last week by three scientists at Montreal’s prestigious McGill University, has “found striking relationships between income inequality and biodiversity loss.”
“Our study suggests that if we can learn to share economic resources more fairly with fellow members of our own species,” notes the McGill Environment School’s Greg Mikkelson, “it may help us to share ecological resources more fairly with other species.”
The McGill researchers compared data on inequality and biodiversity loss for 45 nations — and 45 U.S. states. Their analysis of that data, funded in part by the Natural Sciences and Engineering Research Council of Canada, reveals a consistent “general trend.”
“Societies with more unequal distributions of income,” the research indicates, “experience greater losses of biodiversity.”
How significant an impact on extinctions does inequality make? If the developed world’s most unequal nation, the United States, were to distribute incomes as equally as Sweden, 44 percent fewer plant and vertebrate species in the United States would likely face extinction.
Why does inequality have this impact? The McGill environmental scientists are hoping that future research can help pinpoint the “underlying mechanisms.”
But certain dynamics already appear clear. One example: In nations where a wealthy few monopolize the best farmland, the resulting poverty pressures the poor to till marginal — and environmentally fragile — landscapes.
And in societies where a wealthy few accumulate grand fortunes, they also accumulate disproportionate political power, often enough to prevent — or bulldoze away — environmental regulations.
“With biodiversity loss,” sums up McGill biologist Andrew Gonzalez, “if we don't link the science to the social causes, we will never solve the problem.”
Stat of the Week
Robert Ulrich, the CEO at superstore retailer Target, will walk off with $45.4 million in severance "if he's fired for reasons other than being seriously disloyal or dishonest," the St. Paul Pioneer Press reports. He'll also collect $133.7 million in deferred compensation.
Too Much is published by the Council on International and Public Affairs, a nonprofit research and education group founded in 1954.
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