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Plutocrats: The Rise of the New Global Super Rich and the Fall of Everyone Else

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In the last few decades what it means to be rich has changed dramatically. Forget the 1%; it's the wealthiest .01% who are fast outpacing the rest of us. Today's colossal fortunes are amassed by the diligent toiling of smart, perceptive businessmen who see themselves as deserving victors in a cutthroat international competition.
 
Cracking open this tight-knit world is Chrystia Freeland, an acclaimed business journalist. At ease in Davos or Dubai, Freeland has reported on the lives and minds of these new super-elites for nearly a decade. Grounding her interviews in the economics and history of modern capitalism, she provides examples of the new wealth and its consequences. She showcases the $3 million birthday party of a New York financier months before the financial meltdown; details the closed-door 2005 SEC meeting where the US government allowed investment banks to write their own regulatory laws; and tells how the Bank of Canada's Mark Carney became a key figure in the central battle between the plutocracy and the rest of us.
 
Brightly written and powerfully researched, Freeland's Plutocrats will be a lightning rod event in the midst of the US election season.

352 pages, Hardcover

First published October 1, 2012

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About the author

Chrystia Freeland

6 books88 followers
Chrystia Freeland is the Global Editor-at-Large of Reuters news since March 1, 2010, having formerly been the United States managing editor at the Financial Times, based in New York City. Freeland received her undergraduate education from Harvard University, going onto St Antony's at University of Oxford as a Rhodes Scholar. She attended the United World College of the Adriatic, Italy, 1984-86.

A Ukrainian-Canadian, Freeland has worked in Kiev, Moscow, London, Toronto and currently in New York. She is the author of Sale of the Century, a 2000 book about Russia's journey from communism to capitalism.

She lives in New York City with her husband and their two daughters.

She has appeared three times as a panelist on Real Time With Bill Maher, on February 26, 2010, January 14, 2011, and again on May 27, 2011. She has also appeared on The McLaughlin Group and The Dylan Ratigan Show. Currently, she is periodically standing in for Arianna Huffington as a panelist on public radio's political debate program, "Left, Right & Center", produced by KCRW. (Huffington recently was named president and editor-in-chief of The Huffington Post Media Group, a newly created unit of AOL, and at least for the time being is unable to appear every week.)

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Displaying 1 - 30 of 397 reviews
Profile Image for Vince.
25 reviews8 followers
November 19, 2012
I feel a little guilty about rating this even though I didn't finish it but it just didn't work for me, and that is why I stopped. I read the first two and a half chapters, about half of chapter 4 and then skimmed chapter 5 and read probably a third or more of chapter 6.

The author definitely knows her subjects well, including knowing many of the plutocrats by name. This is a positive because she doesn't have to speak in the abstract but, it also has its down sides. Many of the chapters just read as a series of very short anecdotes, often no more than a few paragraphs in length.

She introduces a theme and then uses the anecdotes as examples. Each new person introduced gets a mini-bio including anything unique about them before proceeding to give the theme supporting details. This goes on in series, making for long, much too long, chapters. We really don't need that many examples of how plutocrats hire top lawyers, or consultants, or whatever thus skewing income in support industries too. A couple would have sufficed, but then the chapters would have been much shorter I suppose.

It might have been forgivable if there had been some deep insight on offer but there wasn't much of that; just endless examples.

The final chapter, titled to echo the subtitle of the book, was probably the best. Here we get our most extensive critique of how the plutocrats view the rest of us, their inflated self-worth and fragile egos. I'll probably finish that one at some point. Still, it is a bit much to wade through to get to the good part.

Overall there is much touring the world of the plutocrats but not much about the fall of everyone else part. Her main perspective on that seems to be that just comes with the territory of progress.

In the end I think the author may be a bit too much of a true believer in globalization, and the plutocrats themselves, to offer much of a critique. Yes, the new plutocrats are often smart math and engineering whizzes and are self-made (with the help of elite educations), but is what they do to make their money really always good for society in the first place? You'll get no analysis of that question here.
Profile Image for Blaise Lucey.
6 reviews3 followers
March 22, 2013
First, readers need to understand one thing: the cover, the name, and the back of the book are a marketing gimmick. For the first hundred pages, at least, there is nothing insightful about plutocrats themselves. Indeed, for many pages, Freeland excitingly glorifies capitalism and its winners. She enjoys referencing herself on many occasions, and just how many people she has talked to who have money, the revelations given to her from people who are celebrities for wealth alone. No crime, of course, but also not what I had in mind when I got the book.

No, I bought "Plutocrats" to hear from the mysterious and oft-maligned 1%. I wanted to know what they had to say about the rest of us. Instead, I got a lot of pages about the ecoystem of business, what "premium talent" means in an economy where the best talent can is instantly accessible to millions, and a comparison between Lady Gaga and a century-old soul singer.

The verdict? Lady Gaga is more successful and more "talented" because she has made more money.

At the core of this book are interesting insights about how the global elite now identifies more with fellow elites, instead of fellow countrymen. How more Harvard students are going into finance than anything else, because that's where money is. How finance people make a much, much more money than the rest of us, because in America it pays more to shuffle other people's money around than make it yourself.

And how, if you're super-talented, you can still excel in an increasingly globalized economy. But if you're not... well, I'll let highlight about one of very few quotes in the book that are actually from a plutocrat:

"The American worker is the most overpaid worker in the world."
Profile Image for fourtriplezed .
455 reviews96 followers
February 13, 2021
There is a good book in here somewhere. The first 3 chapters were very frustrating. Almost an exercise in name-dropping and naming the names dropped and what they ate. Maybe an exaggeration but at times I thought I was reading a series of newspaper items. The last three chapters picked up somewhat as it got a bit more meaty but in the end I am not sure the awards nor the positive reviews were earned. So very very light weight.
Profile Image for Stephie Jane Rexroth.
127 reviews27 followers
December 20, 2012
This book would have benefited from a second author, a sociologist, political scientist or economist, to transform Chrystia Freeland's interviews into a cohesive thesis. The chapters and subheadings were arbitrary; the book read more like an anthology of short articles on the subject of super-elites.

I suppose it is natural for a journalist to want to let the findings of their investigation speak for themselves. But, the conclusions and suggested solutions are what I seek from new information: what does this mean for us as a society? what does this mean for our country in the global economy? what does this mean for the individuals who inhabit the broad base of the meritocratic pyramid? how can we (peasants and paupers) fight back? what role does the government play in stabilizing the inequality? are we simply in the last stages of a declining civilization and if so, how does the average person brace themselves for the inevitable? These were the questions to which I sadly found little to no answer. Maybe my expectations were mismatched to this type of book.

The information provided has grave implications for our collective future. I can only think of a few reasons why this author did not take a definitive stand: she leaves us to connect the dots and decide what action to take; she is fatalistic and thinks that the new robber barons are too big to reign in; or she values her privileged access to this elite cohort too much to risk taking a critical position, alienating her network of high ranking contacts and loosing her all-access-pass to posh dinners, big league conferences and exclusive hangouts of the plutocrats that she mentions attending throughout the book.

In short, if you are a consumer of reality TV, you'll probably enjoy the voyeuristic peek into the lives of the super-rich and famous.
Profile Image for Nadine Dajani.
Author 2 books4 followers
April 17, 2013
This was not as readable as I had hoped - there is quite a but of historical background and unnecessary detail - but it's chock full of interesting tidbits nonetheless. I read this book while on a week-long beach resort vacation so it might not have been the best setting to be reading about economic history, but the fact that I managed to finish it speaks to its merit.
The author provides an interesting theory as to who the Plutocrats really are and why we the masses are less likely nowadays to do away with their heads, French Revolution style, like the masses of yesteryear: today's wealthy have managed to convince us that you get ahead in life based on talent (or merit) as opposed to being born into the right family or having the right connections. Of course, this isn't how things actually work. And when a very smart person applies her talents in the service of enriching herself only, this usually happens to the detriment of society in general - especially in this economy where creativity and innovation are applied to Finance and not to medicine or engineering or even manufacturing.

Plutocrats is great if you want a side of voyeurism with your social study - we get treated to how the rich and mighty live and how they got to be rich in the first place. But a better book about the real social factors behind this and the detrimental effect of the superrich on our world is 'The Trouble with Billionaires' by Linda McQuaig and Neil Brooks. The authors are Canadian professors and not well-connected Atlantic journalists which probably explains the lack of fanfare around this little book, but it's no less readable, and is far more informative.

One thing I really hated about Plutocrats is a short, little sentence in the intro disparaging Communism right off the bat as though only morons or social outcasts could ever see the merit in that economic theory. I'm not a Communist either (I have issues with the lack of checks-and-balances in a purely communist system, and other issues) but after reading Plutocrats I wonder why the author is so disparaging of anything other than Capitalism when the form of Capitalism she describes in her own book looks something like Frankenstein's monster.
Profile Image for Joshua S..
12 reviews1 follower
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November 24, 2012
Reading this book made me anxious as a high-middle class, mid-level management wage slave and a father of two. You can find descriptions of what's in the book and analyses of contents elsewhere- I realize she's a journalist and, I suppose, is following her instincts and her training to be 'fair and balanced' in her approach but:

1) I would have liked to have been presented with some concrete actions I can take to slow down or reverse the seeming inexorable ascendance of the %.1 or at least ensure that my children, like those of the %.1, get the best possible start in life I can provide them.

2) Chrystia tried to hide it but I think she was a bit fawning in some of her prose - she seems to really enjoy/relish her proximity to the %.1... she's a bit to idolatrous of her subjects.

3) At times the information I was taking in made my very depressed, angry and, sometimes, physically ill..

One works so hard.. a more level playing field would be nice. Less rent-seeking (read the book or look on wikipedia) would be nice...
Profile Image for Todd Martin.
Author 4 books74 followers
December 15, 2012
Plutocrats might be described as intelligent, highly educated, self-made, go-getters who have worked hard, innovated and successfully built businesses that create jobs, and benefit the economy. Their products enrich society and create technologies that allow the citizens of third world nations to work their way out of poverty and fashion better lives for themselves and their families. These individuals are compensated well, but fairly, for their achievements. They then use their millions (or billions in some cases) for philanthropic purposes, giving back to the society that allowed them to succeed by creating novel solutions based on their business acumen to solve the world’s many ills.

Conversely, many see them as manipulative, self-serving strivers who finance political campaigns in an effort to rig the system in their favor. By weakening regulations intended to protect investors and the environment they pose tremendous risk the public and by obtaining lucrative tax breaks they shift the tax burden to those least able to afford it. They are the too-big-to-fail robber barons who privatize profits while socializing losses and liabilities, who use accounting tricks to bolster short term gains that enable them to reap huge bonuses and stock option grants even as their company’s performance falters and employee’s wages stagnate (assuming the working class hasn’t already been downsized). They take huge risks with leveraged capital, reaping the rewards as the bubble grows and getting bailed out when it bursts. They shift jobs to overseas sweatshops creating a permanent indentured class while driving down wages in the US.

In Plutocrats: The Rise of the New Global Super-Rich and the Fall of Everyone Chrystia Freeland looks at the ultra-rich, their personalities, character traits, lifestyles and business. Income inequality has grown significantly since the 1970s. With the US now being the most unequal of the developed nations. This comes despite the fact that productivity has steadily increased, with more goods and services being produced with less labor than ever. When less people produce more goods, you’d expect there to be more money for everyone as profits are shared among fewer individuals. But this is not what is happening. Instead the top 1% are taking a disproportionate share of the pie leaving little left for the rest of society. In fact between 1979 and 2007 the top 1% saw average income gains of 275% vs. just 40% for those in the middle class. We are increasingly becoming a winner-take-all society.

With regards to the book itself, I found it to be a lackluster effort. Freeland relates an endless series of anecdotes but uses them to draw only timid conclusions regarding the broader societal implications of income inequality. In fact, much of the book reads like an extremely dull episode of Lifestyles of the Rich and Famous (except that these business tycoons aren’t particularly famous). Secondly, one is left with the impression that she conducted the bulk of her research (at least that which didn't involve a lunch date) using the Google, since the book quite closely follows the format and information summarized much more concisely at Wiki: http://en.wikipedia.org/wiki/Income_i...
Profile Image for Margie.
644 reviews37 followers
January 11, 2013
My low rating for this book is based on two things: the misalignment between the author's outlook and mine, and the way the author organized the information.

If Freeland had expressed either a negative or positive opinion of the rise of a plutocracy, I would have respected her more. Instead she not only presents it as inevitable, but also seems a bit fawning toward the ultra rich. She doesn't go into a political analysis, which disappointed me. She goes along with their analysis without contributing much of her own. This quote from Thomas Wilson, CEO of Allstate, is tossed in without comment:

"I can get [workers] anywhere in the world. It is a problem for America, but it is not necessarily a problem for American business...American businesses will adapt."

I find it hard to read something like that without wanting to comment upon or critique his analysis.

Here's another one that she doesn't comment upon:

"...cutting so-called entitlement spending is a policy which would have a disproportionate impact on the poor, who depend most on these programs - and it is also an idea that plutocrat Pete Peterson has devoted $1 billion of his fortune to advance."

I'm a big time liberal. I'm a tax-and-spend Democrat. So to me, it's a big deal that he's devoting a billion dollars to cutting programs which I believe to be important. Freeland lets it slip right by without comment.

Which brings me to my other point. Freeland tosses data and quotes and anecdotes around with very little organization. There's no through-story to tie it all together. I found it difficult to stay interested because I didn't see the book going anywhere; it just seemed to be more data and quotes and anecdotes.

She also tosses around words and phrases that were unfamiliar to me. I assume that "Middle Kingdom" refers to China, and that "C suite" means corporate suite, but they're never defined. Freeland presents plutocrats as sort of clubby - having much more in common with each other (even across citizenship lines) than with hoi polloi. Her use of words and phrases I was unfamiliar with made me feel as though she was excluding me from 'their' world. Freeland also uses a lot of financial terms I'm unfamiliar with. Obviously the book isn't intended to explain financial transactions, or hedge funds, or short sales. But I wondered who she was writing the book for, if not those of us who want to learn more. Oddly enough, she defines 'high net worth individuals' repeatedly. She also repeats other bits of the book, as though her editor was too bored by the book to follow closely enough to pick up on it.

Freeland tosses out a lot of figures. I'm all in favor of using data to back up one's assertions, but I found it hard to pay attention, hard to care, and hard to put any of the figures into perspective. I would have appreciated at least a few graphs.

I can't recommend the book, which is a shame. She's taken an interesting subject and created an almost unreadable book from it.

Profile Image for Charles Haywood.
496 reviews718 followers
October 30, 2018
From the cover, I expected this book to be a lightweight documentary version of "Crazy Rich Asians," offering painfully amusing stories about the foibles of the super-rich, accompanied by cautions about the negative effects of such behavior upon the rest of America. Plus, the picture of private jets in the driveway attracted me as a vision of my hoped-for future, since I am comfortably in the 0.1%, and much of my time is spent struggling to reach yet higher. Instead, this book is a pretty dense, though rambling, web of analysis, with no funny stories at all. Still, it’s modestly worthwhile in itself, and it has the additional benefit that it sheds light on today.

How is today different than 2012, when this book was published? There are basically the same number of rich people, after all. Trump is what’s different, of course. I don’t think Trump is the explanation for, or relevant to, everything. But the perception of the American plutocracy by ordinary Americans, of its attitudes and of how it got its money, is a large part of why Trump was elected. This book, because it says nothing about Trump, says a great deal about Trump.

"Plutocrats" is basically a compilation of statistics, intercut with anecdotes, mostly gleaned from the very many interviews the author, Chyristia Freeland (a semi-famous journalist, recently appointed Canada’s Minister of Foreign Affairs) conducted with the rich and powerful, everyone from Eric Schmidt to George Soros. The latter, in fact, is mentioned every few pages, each time as a sage of unique wisdom and insight. (The Soros worship is so over the top, actually, that the reader wonders if Freeland has some relationship with him.) Books organized around an author’s interviews with the powerful tend to smack of vanity in an author, who usually seems to think the reviewee’s aura rubs off, but other than with Soros, Freeland does a pretty good job of restraining fanboy-ism.

The author initially frames her book by citing the Kuznets curve—the idea that inequality necessarily diminishes as a civilization gets richer overall. This was not an original idea with Simon Kuznets in the 1950s; the same concept was also advanced by Alexis de Tocqueville. So far, though, the idea has been proven false—inequality is increasing as we get richer. Why that is, and what will likely result, is the theme of the book.

Immediately, though, crops up a significant problem with Freeland’s book—a failure to sharply distinguish inequality of income from inequality of wealth. She slides back and forth between the two, sometimes in the same sentence, treating them as functionally identical, which they are not. Inequality of income is, in large degree, a statistical artifact, since the people at the top are often only there briefly, and something like 20% of the population is in the top 1% of income for at least one year in their lives. Inequality of wealth, that is, of assets, is much more problematic if inequality is the focus, in that there is less turnover in who is wealthy, which means it is harder to reach the top (as I know myself, to my shame and sorrow—I am much farther from the top 0.01% in assets than in income). The envy that is the inevitable fruit of inequality is reduced, at least in America, if people feel like they have a shot at reaching the top, which today, they increasingly do not. But Freeland never even acknowledges this critical distinction.

This is not the only reason the book sometimes feels confused; another problem is that Freeland tries to achieve a global focus, by citing individuals and statistics from India, Russia, and China, but comparing inequality in those areas with inequality in America muddles matters rather than illuminating them, since the book again shifts rapidly among things that cannot be compared directly to each other. On the other hand, the foreign oligarchs do add a frisson to the book—the Sword of Damocles position of many non-Western plutocrats is very obvious and chilling. Freeland adduces the obvious cases of executed Chinese oligarchs and imprisoned Russian magnates, but several of the people she interviewed who were riding high in 2012 are not now. For example, the Brazilian Eike Batista, who made tens of billions in oil and mining, and is noted in the book as among the ten richest men in the world, is now bankrupt and serving a thirty-year prison sentence. I’d rather have less money and more security, myself. I like to sleep easy at night.

Despite these problems, Freeland does a competent job laying out what modern inequality generally looks like, with nods to the Gilded Age as a precursor of today. Not only is inequality increasing, and it has been for decades, most Americans are staying in the same position, at best, or falling backward (at least until very recently, with the advent of what looks like a genuine broad economic boom as a result of Trump’s economic policies). It is only the upper crust that is registering, and hoarding, gains. Americans, rich and poor, used to frown somewhat on inequality of outcome, and a great deal on inequality of opportunity. But since the 1970s, this social consensus fragmented, both due to internal political changes, and to the impacts of technology and globalization. The world as a whole got richer, and very many foreigners were pulled out of poverty by the free market (not by Western charity)—but large numbers of Americans did not share in the bounty, and the elites stopped caring.

If this book were written in 2018, Donald Trump would be the focus, with this feeling of unfairness and being left behind cited as a driver for his rise. Instead, having gotten basic data out of the way, Freeland turns to explicating the culture of plutocrats. She discusses that today’s rich largely are not rentiers; they made their own money, rather than inheriting it, and they work to keep it coming, rather than clipping bond coupons. Many of the richest are innovators who provide value to consumers, or at least perceived value. She discusses their consumption, but also their unhappiness, the risks they take, and the cost on their families (noting that, for all practical purposes, zero women count as this type of plutocrat—they feature only occasionally, as wives and as inheritors of wealth). Not that the reader cries for them, but it does make the reader realize the plutocracy is not just a bunch of caricatures playing Mr. Moneybags.

The most important cultural characteristic, however, is that modern plutocrats are cosmopolitan citizens of the world, feeling essentially no loyalty to the countries of their birth. I would add, in the case of most American plutocrats, that they affirmatively despise much of America and its culture, while sucking up to the “values” of foreigners. This latter point Adam Smith foresaw, how liquid capital erodes loyalty to country, and this accurate perception of American plutocrats is a key driver of Trump’s success. When American CEOs state openly that if “four people in China and India [are lifted] out of poverty and into the middle class, and meanwhile one American drops out of the middle class, that’s not such a bad trade,” it is no wonder that Trump has wide appeal. It’s not just ideological, either—as Freeland notes, “Western businesses are less dependent on a prosperous domestic middle class because they can now sell to the rising middle class of the emerging markets.” American CEOs can preen themselves on being progressive while making money, naturally taking advantage of the stability and protections, legal and otherwise, of America, while giving little or nothing to other Americans.

Finally, along the same lines of plutocrat culture, Freeland notes the “coarsening” effect of privilege and the feeling of plutocrats that “the world should be built around you and your needs.” This is not news (I distinctly remember when I first became rich noting the creeping tendency to feel that the rules didn’t apply to me, something that has to be continuously fought against) and is why in past ages the obligations of the aristocracy to the masses were taken seriously and drummed into young aristocrats. Unfortunately, along with the rest of taught virtue, that instruction is gone, and the result is the Rich Kids of Instagram, Dominique Strauss-Kahn, and myriad other appalling behavior.

Freeland then takes a lengthy tangent, talking about economic “superstars,” people at the top of various industries, from music to finance, who make vastly more than most in their line of work. This effect compounds as society as a whole gets richer, since those with money chase hiring the best in every area, from lawyers to art, who by definition are in limited supply. Technology enhances the effect—the top nineteenth-century opera singers could still only reach a limited number of people, but today’s superstars can often sell to millions. All this is interesting enough, but feels a lot like padding out the book.

Next we get a second long tangent, talking about the impact on plutocracy of revolutions around the world, both real revolutions and economic revolutions such as technology in general and the Russian fire sale of assets. (Freeland overrates the impact of computers; only someone quite ignorant could claim that computers are equivalent in impact to “electricity and the internal combustion engine.”) All of these contributed to the composition of today’s plutocratic class, and Freeland seems to be trying to say that plutocrats risk a new revolution less beneficial to them, where heads end up on pikes.

Most interesting to me is how often, when Freeland quotes various plutocrats, variations on the phrase “value creation” crop up. That’s because many plutocrats get their wealth from non-productive activities, from businesses that most definitely do not create value. We tend to focus on the high-profile actual creators of value: whatever you may think of Jeff Bezos, he earned his money. (It is far less clear, though, whether big companies that have enriched their owners, because people are willing to pay for what they offer, have actually created social value—if Facebook, Twitter, and Snapchat disappeared, and maybe Amazon too, the world would probably be better off. Mark Zuckerberg is not Henry Ford or even Jay Gould.) But many plutocrats, less high profile for good reason, got rich from crony capitalism of various types, ranging from overt bribery in many countries to regulatory capture in the United States, or from being transactions costs, as is true for much of the financial plutocracy and many of the lawyers. That is not “creating value.” Again, most of non-plutocratic America distinguishes how a plutocrat made his wealth; it is a variation on the known phenomenon that the working class resents those rich who are perceived to have earned their wealth much less than the parasitical rich, and far less than they resent the professional-management elite.

Freeland wanders along, ending up talking about “active inertia,” how every plutocrat eventually cannot keep up with change and remains stuck in his rut, except for truly wonderful and exceptional geniuses like, you guessed it, George Soros. Finally, though, we get back on track, if the track is the problem with today’s plutocrats, with a whole chapter on rent-seeking. Freeland channels my favorite academic, Luigi Zingales of the University of Chicago Booth School of Business (though she incorrectly characterizes him as a Republican). Zingales makes the key distinction between being premarket and probusiness—most object less if people get rich by succeeding in the market, but the reality is that most plutocrats loathe the market, and want to use the government or other anti-competitive means to line their pockets. Of course, the best recent example of such behavior is the massive bailouts of firms during and after the 2008 financial crisis, socializing losses while privatizing gains, all of which firms should have simply been forced into bankruptcy, their equity owners wiped out, and their executives disgraced. Instead, Goldman Sachs bankers and their acolytes robbed America. Zingales, less histrionic than me, is famous for noting that Treasury Secretary Henry Paulson, when he “argue[d] that the world as we knew it would end if Congress did not approve the $700 billion bailout . . . to an extent he was right: His world—the world he lived and worked in—would have ended had there not been a bailout. But Henry Paulson’s world is not the world most Americans live in—or even the world in which our economy as a whole exists.” Damn skippy.

That’s just one example of rent-seeking in one industry. And 2008 is merely the most naked example. Unfortunately, though, Freeman does a bad job of providing specifics about rent-seeking, merely muttering darkly mostly about deregulation, which is not the main driver of crony capitalism. Like Rana Foroohar in her book "Makers and Takers," we never get the details, and as I complained when talking about Niall Ferguson’s recent "The Square and the Tower," despite its immense power, the network of Goldman Sachs is never unraveled and exposed. (I was talking to a Jewish friend of mine yesterday, who by chance mentioned that many Jews see criticism of George Soros and Goldman Sachs as anti-Semitic dog whistles. For the record, I think Jews, and Israel, are awesome, and not just in the “some of my best friends are Jews” sense. Even so, Soros is the Great Satan.) In fact, deregulation is irrelevant to the point at hand, since regulation is mostly not designed to hamper crony capitalism, but rather to reduce fraud, so deregulation, to the extent it leads to a free market and is promarket, rather than probusiness, is the opposite of crony capitalism. Freeman glosses over that this is exactly what Zingales says, even though she quotes him for this precise point. The real problem, which Freeman only touches on in passing, is regulatory and legislative capture—the reader would benefit from more detail, such as for example how the stock offering market, which was hoped to be democratized by the Internet, is still a walled garden for underwriters who take no actual risk, just a massive slice off the top, of money that should go to stockholders. Freeman isn’t wrong about rent-seeking, but her explanation is deficient.

The free market creates winners and losers, to be sure, and there is a strong argument that in the modern world, with the leverage that technology and globalization provides, the talented will always pull away from the mass. Freeland hints at this, quoting Andrew Carnegie, “The experienced in affairs always rate the man whose services can be obtained as partner as not only the first consideration, but such as render the question of his capital scarcely worth considering: for such men soon create capital; in the hands of those without the special talent required, capital soon takes wings.” This is the truth; I can count on the fingers of one hand the number of people I know personally with the real talent to create capital in this way. The vast majority of people, even those in the elite, simply are not capable at operating at the top level of actual wealth creation. Such rare people (almost all men, again) will nearly always become rich, if they desire it. But that does not absolve them of responsibility to the rest of society, and it is that disconnect that is the real problem with today’s plutocracy. Freeland tell us, of “the institutions that permit social mobility,” that it takes “economic redistribution—i.e., taxes—to pay for those institutions.” That’s false—almost all taxes are spent to line the pockets of the elite, or to provide create incentives for the poor, not the working masses, who struggle along. Not to mention that most social mobility is not the result of government “institutions,” but of the right culture not hampered by the government. The responsibility of plutocrats here is not to pay more taxes, but to pay attention, in business and politics, to the interests of those less successful.

Freeland ends by comparing us to Venice, which is said to have declined after its oligarchy closed its ranks to new entrants and clamped down on vigorous entrepreneurialism. True enough, I think, but given that Venice never regained even a fraction of its power, security, or relevancy, that doesn’t help us much, nor does Freeland offer us even a hint of what we should do.

I have a few ideas, though! We can start by having Congress break up all large finance entities and aggressively discourage future rent-seeking, capture and revolving door activity. Among other methods we should forbid, under penalty of ten years’ imprisonment, any work of any kind in the financial industry by former government employees. Also, anyone who has ever worked at Goldman Sachs, even as an intern or secretary, should be instantly fired from any position in the federal government and barred from ever working in government again.

It’s not just finance, though. That’s the tip of the iceberg. I think we should return to the Brandeisian view of antitrust law, viewing with deep suspicion all concentrations of corporate economic power. In fact, Zingales and his podcast partner, Kate Waldock, were just discussing this on their excellent podcast “Capitalisn’t,” which I highly recommend you check out. And there are some books coming out on this very topic, which I expect to review as well, since I think this is a critical matter. For current purposes, we should just agree that we can erode the power of the plutocrats, and increase opportunity for all Americans, by judicious hammering of entities that have acquired excessive power and are using that power in a way that does not benefit all of America.
Profile Image for Matthew Jordan.
71 reviews53 followers
December 23, 2022
Extremely instructive, quite distressing. There’s a global class of people rooted to no sense of place, who exist in their own kind of multinational ultra-wealthy world, whose main tribal affiliation is to the powers of global capitalism.

As always, the thing that really opened my eyes here was learning more about the history. So much of this is due to macroeconomic changes in the 1970s and 1980s. I can’t claim to understand this deeply, but I think the story goes something like this: World War II happened and shook the world to its core. After the war, there was a period of unprecedented economic fortune, especially in the United States, Western Europe, and Japan. Many countries grew rich and many people’s quality of life improved, in part because governments were growing in size to introduce welfare programs. The shake-up of the war, coupled with progressive taxation, meant that wealth was more evenly distributed, and more people had an opportunity to live a middle-class lifestyle. People lived in suburbs where their day-to-day experience of living was overhauled by new technologies like the refrigerator, dishwasher, and television, not to mention air travel. People had tons of free time and used it to experiment with drugs and invent new genres of music. Some people worried about overpopulation and starvation, but that never came to fruition; we were too good at inventing new kinds of fertilizers and pesticides and producing tons of food.

The fun could not last forever. Something happened in the 1970s (one imght ask: WTF happened in 1971? https://wtfhappenedin1971.com/) and the era of big government was apparently over. People like to point to the 1973 oil crisis as the sign things were untenable: a bunch of Middle East and North African countries decided to stop selling oil to the West and so the price of oil skyrocketed, and maybe this was because governments had been playing a role in artificially controlling the price of oil, so big government is bad? Or perhaps it has something to do with the removal of the gold standard in the US, meaning that the government will not turn your money into gold; your money is just your money and its value is dependent only on the value we all agree it has by virtue of having money, not by virtue of how much gold it’s worth. Or maybe it’s something something neoliberalism Salvador Allende something Augusto Pinochet. I have no idea. The point is, something changed starting in the 1970s.

In the years after the oil crisis, a bunch of the changes that took place in the postwar period were reversed. These include deregulation of financial markets, the reduction in size of the welfare state, the expansion of global markets for many goods and services that were previously public goods or non-market commodities (e.g. housing, healthcare, education, public utilities like electricity), and liberalization of trade (i.e. fewer tariffs of restrictions on global trade). These changes, combined with improvements in global telecommunications and cheapening air travel, meant that people seeking to become wealthy no longer needed to just look to their own local or national markets when thinking about vendors, employees, or customers. Fast food chains could open around the world; shipping companies could have complicated global supply chains; American companies could move their factories to China or Bangladesh or the Philippines so they could pay lower wages to workers.

Side-note: I am particularly interested in how effective altruism ties into all of this. Peter Singer’s drowning child experiment is a direct result of being able to watch conflicts play out across the world and feel like he has the means to help. This isn’t really possible without global media and international charities. EA is largely premised on the idea that we are all “global citizens”, that our primary moral obligation is to the world as a whole. I am very curious to know more about this idea. I think that Marshall McLuhan invented the term “global village” in the 1960s. The 30 Hour Famine and Doctors Without Borders, both staples of my high school education into issues of global poverty, both started in 1971. This feels consequential. Where did the idea of people wanting to “save the world” come from? I’ll be thinking more about this.

Anyway, returning to the plot: the people who ran this new crop of international companies became extremely wealthy. Barenaked Ladies wrote “If I Had a Million Dollars” in 1992; Travie McCoy and Bruno Mars sang “I Wanna Be a Billionaire” by 2010. If you wanted to be rich, you were no longer competing with the wealthy people in your city or country; you were now encountering plutocrats from all corners of the world. Not coincidentally, these changes coincided with stricter admissions policies at the world’s top universities, creating a feedback loop between entry into hyper-elite spaces and access to global wealth.

But this wealth did nothing to lift up the communities these billionaires were a part of, because the money was not coming from their local community in the first place. This is uprooted global wealth, connected more to arbitrary and identical-looking boardrooms in London, New York, Shanghai, Hong Kong than they are to the place where the goods are being bought or sold. When the internet came into play in the 1990s, this phenomenon only grew more pronounced, and still more pronounced when software started eating the world in the 2000s. Tech entrepreneurs could become part of the global elite from their comfort of their own homes.

And that brings us to today. We are in a pretty untenable situation. Not to get all Bernie Sanders about this, but the wealthiest people on earth really do control a silly amount of money. Much of the productive labour on earth seems to go into the hands of corporation owners, rather into the hands of the people and communities doing the work. We are beginning to see the downsides of globalization: easy spread of pathogens, people losing jobs to offshoring, homogenization of culture, disconnectedness from local ecosystems and communities, real estate owned by global private equity firms that drive up prices. Even the positive spin on these things: “van life”, “digital nomadism”, something feels a little bit off about it when you see it in the context of these broader political and economic forces.

I am not an expert in anything I just said, and surely my understanding is flawed, but that’s my sense of the big-picture way we got to where we are today. Of course, this is not a new phenomenon: in the late 19th century, a small class of ultra-wealthy businesspeople who owned the oil, the trains, the gas, and the steel became ultra-wealthy and presided over an enormous societal overhaul. The Rockafellers and Carnegies and Vanderbilts of the world were the 0.01% of their day. They used their wealth to endow universities and research centers and libraries, many of which persist today. Today’s billionaires, at least the ones who do philanthropy, spend their money on things like global health and education, reflecting the change in the scope of these billionaires’ concerns.

Once again, this is SO closely tied to effective altruism. Is the “expanding moral circle” really just about more people falling under the purview of global capitalism? If anyone anywhere in the world can be your customer and buy your software, is that the reason that we now view those same people as falling inside our circle of moral concern? Is taking an “impartial global moral view” only possible if you’re a member of a global class of people who feel no particular affiliation to their local context?

I think the reason this book was so eye-opening to me is because I’ve spent the last 5 years among this very group of people. The moment I arrived in Oxford, and in particular the moment I was introduced to the community around the Rhodes scholarship, I was struck by the feeling that this was somehow my invitation into the global elite. The following year, I participated in a fellowship program based in Silicon Valley and felt the same way; that I was being invited into an exclusive club of highly concentrated wealth, its own little independent pocket of the world, tucked away from pedestrian concerns.

The strangest thing of all, though, was how closely these two communities were connected. I was constantly seeing the same people pop up between these two places. Ivy league graduates and high-profile scholarship winners and entrepreneurs bouncing between the UK, San Francisco, and New York City, as though these were the three legitimate places one could live. I have been very tempted to participate in this lifestyle myself—it’s very hard to escape it once you’ve been introduced to it. But something about it feels wrong, in a way I am not quite able to place. Perhaps the strangeness is simply rooted in the fact that I am witnessing my own friends and peers become part of a class of people one step removed from the Plutocrats Freeland documents in this book. It’s the cognitive dissonance of knowing that some of the most interesting and brilliant and best people I know are essentially courtiers to the ultra-rich. There is also the terrible feeling I acquired from Oxford that if I spend my career teaching at a great Canadian university, I am not doing enough to fulfill my potential to make a truly “global impact”. I dunno. Maybe we need less global impact. Plutocrats is all about people making a global impact, and they don’t seem that enviable to me.

I worry with these book reviews that I’m not actually saying anything about the content of the book and am more just talking about my own experience and takeaways. You might read this book and find that what I’m talking about takes up like 15 pages total of the actual book. But that’s what I do! Sue me! Sometimes the virtue of a book is not in its contents at all, but in the thoughts that were lying dormant that it can bring to the fore. Either way, this book is good and brought out lots of latent thoughts for me. Pairs well with The Tyranny of Merit by Michael Sandel (GOAT) and Winners Take All by Anand Giridharadas.
Profile Image for David Stephens.
481 reviews10 followers
December 24, 2012
In Plutocrats, Chrystia Freeland examines "those at the very top: who they are, how they made their money, how they think, and how they relate to the rest of us." She makes a distinction between the richest 1% and the richest 0.1% because there is a large discrepancy between these two groups that is less frequently noticed than the one between the top 1% and bottom 99%. In fact, she suggests there are two separate economies: one for the rich—a "plutonomy"—and one for the rest of the country. And, it is the economic gains made by the plutocracy that have masked weak economic growth for everyone else.

The economy flourishes best for everyone when there is less income inequality and more social mobility. The balance struck between the government and the business world in response to the era of robber barons led to a period of outstanding economic growth (roughly, the 1940s through the 1970s). This balance included banking reform like Glass-Steagall, the New Deal's social welfare programs, and higher taxes on the richest Americans. Unfortunately, these reforms have slowly eroded—though, not on their own—and returned the country to extreme levels of inequality. These deregulations haven't been the only source of trouble, though; globalization and quick advancements in technology have substantially aided this inequality as well.

Freeland takes a level-headed approach to her topic (she is Canadian after all) and doesn't mischaracterize rich financial types as evil schemers who laugh at the plight of the poor. To do this would be to grossly oversimplify an incredibly complex situation, something Freeland does an outstanding job avoiding. Instead, she reasonably dispels some of the unfair myths about plutocrats. She notes how many of the current richest Americans have earned their wealth as opposed to inheriting it as many robber barons did in the late nineteenth and early twentieth centuries. She also defends—to an extent—financial elites who precipitated the crisis of 2008, as they were unable to respond adequately to the changing world economy. The crisis did also involve corruption, but there was more to it than just that.

Even though Freeland uses a pleasant tone, that doesn't mean she lets problematic thinking and situations slide. All too often, plutocrats' views illuminate their separation from the less affluent and point to problems in their thinking. Perhaps, most pernicious is the idea that business interests always coincide with those of the state. However, since financial elites are more a part of isolated international communities than of their country of origin, this is becoming less and less so. On top of that, it is easy for people in general to believe what suits them even when others are clearly suffering as a result. As Duke professor Dan Ariely puts it, "When you have a financial incentive to see reality in a certain way, you will see it that way, not because you're bad, but because you are human."

Overall, this is a balanced look at the world of plutocrats.
Profile Image for Owlseyes .
1,649 reviews266 followers
Want to read
January 12, 2017


I have watched the interview Matt Taibbi and Chrystia Freeland gave to Bill Moyers. CF spoke about her book. Some notes I’ve taken, ahead:

(a) The topic of the inequality/super-rich (the top 0.01%) is still a taboo, as the debates between M. Romney and B. Obama showed; the think-tanks feel good about approaching “poverty” ,though. The former topic, in the words of CF is “very frightening”.

(b) CF spoke of several phenomena under way: a hammered middle class, the attack of the plutocrats on “entitlements”, the economy growth has been “stifled”; the social mobility has been “squeezed”; the problem of some thinking “you’re part of the DEPENDENT 47%” . Also, the "cognitive capture".

(c) Matt compared the present situation in the USA to that one in Russia in the mid-nineties: when the State merged with the private power, and a “tiny little clan was empowered” [the Oligarchs]. To Matt, it’s a tough situation for the poor, who feel “demoralized” …finding “obstacles to rise up”, including the mentality “it’s your own fault”.

(d) The “global tax over wealth” was spoken about; also the “battered wife” e-mail reaction of some plutocrats, when Obama considered the issue.

(e) CF though being a Canadian-born editor (almost “socialist –born”) ...,she believes in capitalism.
[!]



UPDATE

Trump, as president. will make a huge difference in the economy, if one believes he'll enforce/fulfill his many promises. Then, will this book become obsolete?
I'll be back on it.

24th Nov 2016

Canada names Chrystia Freeland, leading Russia critic, as foreign minister
in:
https://www.theguardian.com/world/201...

12th January 2017
Profile Image for Caren.
493 reviews102 followers
October 31, 2012
I wanted to read this book after seeing the author on "Moyers & Company:
http://billmoyers.com/episode/full-sh...

(If you go to the website, notice the "Dig Deeper" link on the left. Mr. Moyers is starting a book club, with this book as his first selection. There is a discussion and will be a chat with the author coming up soon.)

This is a topic which seems to be gathering interest. Charles Murray's book, "Coming Apart", Geoffrey Faux's "The Servant Economy", and other recent books have addressed the issue of the rising super-rich.
The author is a Canadian journalist who was able to study the rise of an oligarchy at close range while covering Russia after the break-up of the Soviet Union. She seems to have had extraordinary access to plutocrats worldwide and gives a measured account of the inner workings of the very rich. She says our new Gilded Age came about as a result of three factors. First was what she terms the "Washington Consensus" which replaced the Treaty of Detroit (a sort of pact that labor would be granted generous benefits in exchange for fewer work disruptions through strikes). The Washington Consensus (when President Reagan in the USA and Margaret Thatcher in Britain "reined in trade unions, cut social welfare spending, and deregulated the economy", pg 17) was made possible by the fall of communism, which had previously acted as a sort of ideological foil to capitalism. This consensus combined with the technology revolution and globalization to make possible the unfettered rise of the ultra rich. The interesting thing about Ms. Freeland's book is that she is not just looking at the rise of a plutocracy in western industrialized countries, but has included the rising BRIC (Brazil, Russia, India, China) and emerging economies to make this a global phenomenon. Globalized industry, she shows, does not feel itself a part of any individual nation. She quotes GE's Jeff Immelt as saying that the U.S. consumer "is not going to be the engine of global growth. It is going to be the billion people joining the middle class in Asia...". Further, she quotes the CEO of Allstate, Thomas Wilson's, remarks, "I can get [workers] anywhere in the world. It is a problem for America, but it is not necessarily a problem for American business..." (p. 64)
The author included a very provocative quote from that classic economic text, "The Wealth of Nations" by Adam Smith: "The proprietor of land is necessarily a citizen of the particular country in which his estate lies. The proprietor of stock is properly a citizen of the world, and is not necessarily attached to any particular country." (p.67)
Ms. Freeland goes on to say, "But while capital--and capitalists--have gone global, governments and most of their middle-class citizens operate within national boundaries. Figuring out how the plutocrats are connected to the rest of us is one of the challenges of the rise of the global super-elite." (p. 67)
What sort of people rise to the status of the super rich? According to the author, they are pragmatic technocrats.She says the very brainy are rising to the top of both the left and the right. Just as Charles Murray pointed out in his recent book, "Coming Apart", these people move in circles that are insulated from the rest of us. It used to be that an industry captain may have married his secretary; now, he probably met his wife in an Ivy League grad school and, even if only one of them is working, they are both from the very tip-top intellectual class.
In a very telling paragraph Ms. Freeland says: "Indeed, at a time of fierce partisan conflict, one of the striking paradoxes is how much the champions of liberals and conservatives have in common: Mitt Romney and Barack Obama are both disciplined , dogged millionaires who describe their more popular wives as their better halves, hold degrees from Harvard Law School, and have a preference for data-driven arguments rather than emotional ones. Both men struggle to connect with the grassroots of their parties, coming across as cold and robotic. You might call it the cognitive divide--the split between an evidence-based worldview and one rooted in faith or ideology--and it is one of the most important fault lines in America today. To his critics on the right, Obama is a socialist with dangerous foreign antecedents. To his critics on the left, he is a waffler with no real point of view and a craven desire to be liked. But the best explanation is that, like the rest of the rising intellectual class to which he belongs, the president is an empiricist. He wants to do what works, not what conforms to any particular ideology or what pleases any particular constituency. His core belief is a belief in facts." (p.93)
From where are these new intellectual elites pulled? Here are some of Ms. Freeland's comments about that: "Revolution is the new status quo, but not everyone is good at responding to it. My shorthand for the archetype best equipped to deal with it is 'Harvard kids who went to provincial public schools'. They got into Harvard, or, increasingly, its West Coast rival, Stanford, so they are smart, focused, and reasonably privileged. But they went to public schools, often in the hinterlands, so they have an outsider's ability to spot the weaknesses of the ruling paradigm and don't have so much vested in the current system that they are afraid of stepping outside it." (p.146-7)
She relates that some analysts say "that responding to revolution is a biological trait, genetically inherited, and that one way to be sure your society is good at it is to open your borders to immigrants, on the theory that moving to a new country is an example of responding to revolution." (p.147)
I have just scratched the surface of all of the interesting topics explored in this book. My copy is well-marked with lots of underlined passages. I think this well-written book is fascinating and worth the time you'll invest in reading it. I liked one of Ms. Freeland's closing remarks: "...Low taxes, light-touch regulation, weak unions, and unlimited campaign donations are certainly in the best interests of the plutocrats, but that doesn't mean they are the right way to maintain the economic system that created today's super-elite. Elites don't sabotage the system that created them on purpose. But even smart, farsighted plutocrats can be betrayed by their own short-term self-interest into undermining the foundations of their own society's prosperity." (p. 286)
Profile Image for Paul.
Author 26 books8 followers
September 12, 2013
If you truly, really genuinely believe that there's nothing wrong with our economy that can't be fixed by rich folks being a little bit less greedy, then you'll want to read this book. Unfortunately, like a certain presidential candidate, the author is not competent to present her own case. When a capitalist quotes Marx, as Freeland does, it's a bad sign. When she misreads him, along with much else, it's a sign of desperation. Used to be that Harvard graduates and Rhodes scholars were well equipped to defend their class. Not anymore.
Profile Image for Sean.
157 reviews32 followers
December 16, 2012
I found this book on plutocrats interesting but mostly composed of loosely related vignettes rather than an all-encompassing thesis rigorously defended by its author and what that I had hoped to find. Yes, the growth in technology and globalization have increased inequality. Yes, you point to the rise of the intellectual class and the importance of human capital. And yes, you describe the plutocrats and how they ascended. But I wanted the author to tie it all together in a coherent thesis that offered a new perspective and did not find it.
Profile Image for Al.
160 reviews6 followers
October 28, 2012
Henry Ford said that mass production required mass consumers. This was his way of saying that his success was dependent on the existence of a successful society. I think he also understood that gains made by adding value to society will lift the boats of everyone for the most part.

The problem comes in when those at the top "arrive." They almost certainly try to set up barriers for others in order to maintain their privileged positions (think Citizens United). This is when the whole system becomes a cancer on a society, and the whole thing turns into a zero sum gain.

I have read that in America, the richest four-hundred, and forty individuals have as much personal wealth as the bottom one-hundred, fifty-one, million combined. This figure represents one half of the entire American population. In fact, in this book she tells of a well educated financial insider that went home to India to warn political leaders to protect their country from becoming an Oligarchy on the scale of Russia, or the United States.

We are not use to thinking of America in these terms, but the writing is becoming more visible on the wall every year. Ford was right; mass consumers are needed. However, just like their employees, this time around it will be just as easy for the Plutocracy to find them elsewhere in the World. These elite few are truly World citizens, and they have built a very insulated society for themselves. America's elite have never held so strong a hand, and America's middle class has never held such a weak one.

I won't debate the politics surrounding this issue, I'll just say that it is in your interest to figure out where you fit into the "Big Picture."
Profile Image for Sera.
1,164 reviews93 followers
August 5, 2013
3.5 stars

This book pretty much confirmed what I already thought:

*The game is rigged against those of us who don't fall into the 0.1% of the top 1% of wealthiest in global society, known as the "Plutocrats".

*The Plutocrats live in a bubble of self-entitlement that has extended to the point where this group of people feels that they can do better for society than any government.

*Much of the wealth that this group has earned comes from both illegal and legal corruption. They are not as "self-made" as they profess to be unless we now believe that using bribes and other means of non-meritorious advantages that these people obtain is acceptable.

In the end, the Plutocrats are a bunch of d****bags. They are currently looking for an island or planet where they are can live together and where no government can reach them. I say I hope that they get to that place soon. As the saying goes, "[D]on't let the door hit your ass on the way out." Most of these people are adding nothing to society. They are not "value creators". They are "value siphons".
Profile Image for Dave.
422 reviews10 followers
November 20, 2012
Today's world is going through two Gilded Ages simultaneously, the 2nd for the U.S. and the 1st for the BRICs. The income inequality in these nations has created a situation in which the top 1% have more in common with each other than with their own countrymen. Charles Murray did an incredible job of covering this and analyzing from the perspectives of American culture splitting along class and education lines to the point that we're a pair of de facto separate societies. Herein Freeland analyzes and interviews the upper echelons of the top 1% and, though it's never really clear if she views this group as bad, good, a mixture, or what, it is a very important book for understanding today's society.

In many ways there are two kinds of plutocrats,rent seekers - those who obtained their wealth through government connections and services that do not create value for society, like trading mortgage-backed securities - and innovators - Jobs, Gates, etc. The former is generally reviled by society because their wealth accumulation did not better society, while the latter is largely (and I believe deservedly) applauded for their contributions and seen as more "deserving" of their gains. Unfortunately Freeland largely only has access to the bankers and their quips about "eating what they kill" fall on deaf ears when $750 billion in taxpayer money was needed to prop them up when their zero sum trading scheme's bills came due. They think they're John Galt's when in reality society is in no way dependent upon them, which is of course not the case for tech innovators who created a need - PCs, smart phones, etc. - and then made a profit off delivering these life-bettering products to society en masse.

Freeland seems to find it difficult to balance between the idea that the top of the pyramid create jobs and industry for everyone else and the opposite side of the coin that states societies tend to unravel, often violently, when power and wealth is concentrated in the hands of the few. She uses the words "Harvard" and "Goldman Sachs" more than the word "the" and her writing does suffer from this homogenous cast. Wharton and Columbia have produced as many billionaires as Harvard, and if Stanford's class were the same size it would have as well.

The author is correct in that capitalism has won, with nearly every nation on earth embracing it in some form, and with nearly every society better off for it. The problem is that the U.S. now has 84% of the wealth concentrated in the top 20%, incomes have flatlined if not slightly fallen for the middle class over the past 39 years, and our legal corruption ranking places us in the same neighborhood as Russia and China. Left unchecked those at the top can change the laws and use legacy admissions at top schools to create a hereditary oligarchy that chokes off class mobility and decreases economic competitiveness. She effectively uses the example of Venice rising to the world's richest city, creating an aristocracy based on family lineage, and then falling behind more innovative European cities as their meritocracies created more wealth. A similar fate looks to be in its initial stages in the U.S., Russia, and China, amongst others, and it may be that the country best able to resist this urge to consolidate wealth and position and then denying others access to it will be the one best able to take advantage of the next century.

Parts of the book are out of place - performers make more now because the audience is now the globe rather than a concert hall - and much of the last third of the book (excluding the strong conclusion) was repetitive. However, this was a 4-star book overall and the content within is extremely useful knowledge as we navigate a Gilded Age from one corner of the earth to the other.
Profile Image for Bobbi .
69 reviews10 followers
January 7, 2013
A well-researched overview of the steep income disparity that characterizes our current gilded age (the second robber baron era for the West and the first gilding for China, India and others). I enjoyed how Freeland offered both historical context and took repeated stabs at defining the psycho-social fallout of towering wealth built on dwindling resources and the consumerism of the creaking middle classes. The fallout, though, isn't actually the focus of Plutocrats. Rather Freeland simply tries to capture a moment in time; painting a portrait of those who live in "the bubble."

She offers rare inside glimpses of how the 1 percent lives, in Russia, China, India and the US. Universally, the wealthy are lauded, admired, watched and hated. In China, where becoming a billionaire often involves government collusion, getting too rich and boastful about it carries a serious risk of being hauled up on criminal charges and even executed. (I'll let Freeland explain further.) That doesn't happen in the US, where there's also ample collusion or "rent seeking" by moneyed interests needing government access or acquiescence. We already know this is how the world works, still reading the case studies is enlightening.

The details of how the 1 percent or the .1 percent climb the mountain and live atop it helps the rest of us understand why the wealthy come see themselves as especially deserving of their largesse; and the unwashed masses as responsible for their own economic fix. Thus, we have put-upon Wall Street billionaires, who complain about getting an unfair shake in the public eye, and developing world bazillionaires who live in unimaginable luxury in high-rise castles a stone's throw from the lowest of slums.

This book shines when it examines our cultural views and caste systems, taking a closer look at our "hero" entrepreneurs hypocritically dressed down in jeans as they board their private jets (in Silicon Valley) and the hugely compensated and self-righteous Wall Street financiers who're both adored (by a public that wants the same opportunity to strike it rich) and skewered (by the Occupy movement).

Freeland does not vilify the wealthy, but lays out a detailed picture of how they live and think. She even includes a discussion of how the current crop of billionaires may be an inevitable outcome of technological and social upheaval. At the same time, she makes no apologies for their greedy, self-centered, moat-building and resource-hogging behavior.

This journalist's approach may frustrate those who're looking for strong conclusions, and I agree with the reviewer who said not to expect Naomi Klein. But Plutocrats isn't a call-to-action, so much as a portrait of our economic times.
33 reviews6 followers
November 26, 2021
Freeland is an intelligent author, but as others have found, the delivery of this book is awful. The narrative is aimless and meandering, which makes it difficult to pay attention. It feels like Freeland is just throwing info at the reader to sound impressive.

Read Dark Money by Jane Mayer for a more engaging and illuminating book in the same genre.
Profile Image for Julian Douglass.
304 reviews11 followers
October 19, 2022
I had to change my rating becasue after taking some time to digest this book, this one was a slog. First of all, this book really doesn't highlight anything new if you have been knowledgeable of what has been going on in current affairs for the past 30 years or so. Second, each chapter is about 50-60 pages and goes on and on about the same topic with different anecdotes but all talking about the same thing. Third, she inserts herself into the story way to much to make it seem like she is apart of this lifestyle and is offering a defense of the lifestyle rather than a critique as the title implies.

A good idea for a book, but rather misses the mark and is more of a survey of the lifestyles of the plutocrats rather than a look into the culture and ways to fix the problem. Glad to be finished reading it.
Profile Image for Rachel.
131 reviews
January 2, 2013
If you were expecting Naomi Klein, you will be disappointed. Chrystia Freeland's Plutocrats is more pastiche than polemic. You will find some important information in respect to the growing income and wealth disparity in America and the world. For instance, 20% of Americans own 84% of the nation's wealth (compared to 36% in Sweden); in 1970 the top 1% took 10% of the national income, today they take over 30%; in 1980 the average CEO made 42x the wage of the average worker, today they make 390x the wage of their employees; 93% of the gains from the 2009-2010 "recovery" went to the top 1%; the top 25 hedge fund managers are each paid over a billion dollars a year; the richer you are, the lower your effective tax rate--the top 400 tax payers paid less than 17%; inequality in Russia is higher than it was under the czars. Interesting. Depressing. She also includes a number of anecdotal stories that are more praise than censor of plutocrats from around the world. She does include some analysis in the concluding chapters of the reasons for the growing disparity and what it portends for the future of democracy in the world and our nation. Not promising. The momentum seems as unstoppable and the results as catastrophic as that other obvious threat to global well-being, global warming. She cites the collapse of the economic power and cultural hegemony of 14th century Venice as the exemplar of our own inevitable demise.
It is surprising to discover how recently the course of events have changed to facilitate the rise of a plutorcracy. The revolution, and it was a revolution, began with the development of hedge funds in 1949, venture capital in 1946, and, finally, the origin of private equity in 1990 with its attendant hostile takeover and dismantling of our manufacturing infrastructure. Thus, the financial sector went from the conservative stewardship of other people's money to specializing in risk, leverage, and outsized returns (120). The revolution is not confined to the financial sector. Irving Kristol created right-wing institutions to reshape our culture and values by establishing think tanks, foundations, schools, media, and other culture-forming apparatus. A process he calls, apparently unaware of its Orwellian connotations, "thought leadership". Its particular target is the humanities--the state of humanities is evidence of the success of Kristol's "thought leadership" in shaping public attitudes and political policies that defund and devalue (remember Obama praising the humanities anyone?) the humanities in education. Chrystia did not raise the point, but the recent backlash against teachers is simply another feature of the right's "thought leadership". Chrystia does note that the success of the right's "thought leadership" is evidenced by the fact that the pro-business interests do not need to rely on bribery or lobbying their interests because they have coopted the regulators and legislators into adopting a paradigm where they fail to see differences between themselves and the businesses they are supposed to regulate. Chrystia portrays America as becoming (isn't it already?) an "extractive" state--one controlled by a ruling elite whose objective is to extract as much wealth as possible from the rest as opposed to America being historically an "inclusive" state--where everyone is given a say in how their society is ruled and equal access to economic opportunity. I think many would disagree with her characterization of America as ever being an inclusive state, but few would disagree that it is becoming more and more extractive. Finally, almost as an afterthought, she notes the parallel between Venice's Book of Gold to reify the elite and the role of elite universities in "perpetuating privilege" rather than recognizing merit. Conspicuously missing from Freeland's book are any suggestions, or even hope, for addressing this crisis of democracy. But it is a good place to begin the discussion.
Profile Image for Conor Ahern.
657 reviews189 followers
February 22, 2017
I ended up really liking this book, but it took a little while. As others have mentioned, the first 1/3 or so reads like a “Lifestyles of the Rich and Famous” and is devoted to explaining the trappings of extreme plutocracy and the ways by which the purseproud rich have bent the machinery of government and the economy to their wills and fortunes. Freeland, herself a Harvard graduate and a Rhodes Scholar—undoubtedly the single likeliest pedigree for shameful self-promotion and aggrandizement—does not waste an opportunity to mention an academic credential, nor a peak salary earned, nor a second-home-maintained’s location in Cote d’Azur, Southhampton, or Belgravia.

But the book redeems itself in its latter parts. Freeland ably demonstrates the maudlin lamentations of the persecuted rich, who imagine themselves besieged by business friendly regimes such as the Obama administration. She explores what are, amazingly, sincere beliefs held by moderate and democratic stalwarts such as Chuck Schumer (ugh) and Mike Bloomberg (ugh), who earnestly believe that “overregulation” of the financial industry is inimical to the prosperity of places like NYC and the United States. And she concludes with the cautionary tale of Venice, once the most prosperous and populous of Europe’s cities, which launched to prominence on the strength of inclusive economic policies and stagnated on a retrenchment of opportunity.

It sounds like we’re in for some long-term decay unless we get our policies and priorities in order.
Profile Image for Josephine.
138 reviews17 followers
July 7, 2013
For the past four years, Carlos Slim Helu, the Mexican self-made multi-billionaire, has topped the Forbes Billionaire list, with an estimated net worth of $73 billionaire as of March 31, 2013.

Do you know what that translates to? Carlos’ net worth is equal to about 400,000 of his fellow Mexicans.

A more often cited comparison is this: the combined incomes of Bill Gates and Warren Buffet equals the wealth of the bottom 40% of the nation.

Former Financial Times deputy editor Chrystia Freeland’s “Plutocrats” is full of interesting nuggets of information like this. Not being in the top 1%, it’s easy to burn a little with resentment, when you think about how middle-class incomes have stagnated while the average American CEO makes about 380 times more than the average worker.

This book actually focuses on the top 0.1% — nevermind the 1% — and who these people are. More often than not, they come from humble beginnings and claw their way to the top, making their own money rather than inheriting it. They’re intellectual elites, going to the best schools, and they make their first fortunes early.

Plutocrats often think that what’s good for them is good for everybody else — which clearly shows how out-of-step those at the very top are with the rest of us. I’ve seen it, time and time again, in nearly every place that I’ve worked at. More often than not, those at the very top have zero clue of what it’s like to work on the frontlines.

Freeland cites globalization and technological change as huge drivers of economic inequality; but also points to political forces — lower taxes, deregulation, privatization, weaker protection for unions.

While it’d be easy to dismiss this book as an exercise in dredging up disgust for the super-wealthy, this book isn’t about flaunting the exploits of the 0.1% in our faces; rather, it’s an economic analysis…but one that’s completely absorbing to read.
479 reviews2 followers
November 21, 2012
Entertaining reporting by a former Financial Times reporter on the rise of the 1% and what it all means. A lot of reporting and some very interesting anecdotes, although an even deeper analysis at times on why/how it all happened would've been helpful (she gets into that too, and I generally agree with the analysis, I just wanted even more details). Also, she seems to have a shallow understanding of so-called free-trade: apparently it's a fact of life for manufacturing workers, but highly skilled labor like doctors, lawyers, accountants, etc... seem to be immune. There's a lot of highly skilled and educated doctors, for example, in countries like India and elsewhere. I'm a big advocate of 'free-trade', but it SHOULD mean an exchange of good and services regardless of income strata and lobbying power. If only the AMA (American Medical Association) weren't such a powerful and protectionist lobbying firm. Oh well, c'est la vie, I guess.
Profile Image for Abhijit Selukar.
15 reviews9 followers
March 27, 2013
Not sure if I should rate the bool.
The book is so mediocre that I had to stop half way into reading it. The book is nothing but verbalization of data gathered from sources all around the world.
The book does not provide any solution. Just plain Data.
The author has again taken advantage of the current turmoil for her benefit and released the book.If the book was released in 2006-07, no one would have cared.

Read this book if you are a socialist.
NOT recommended if you believe in capitalist ideology.

All said and done, the income inequality is a big question around the globe. The problem is people (particularly policy makers) just talk about it and do not provide solution. Trust me taxing the rich will not work. There has to be a better solution. Better pay and less corruption will go a long way.

AVOID this book.
Profile Image for Kristine Morris.
561 reviews14 followers
October 30, 2013
I read many of the reviews of this book, and while I have no doubt that experts in labour economics, the financial crisis and those who study of capitalism may disagree with some of what Freeland has written, for the average jane it provides a readable in-depth understanding of why the income divide is happening and why (most of) the plutocrats don't understand why the 99% might have a bit of a problem with their wealth generation.

The hardest chapter to read was the second last chapter when Freeland, based on many interviews of the plutocrats, described what THEY think of us. I imagine it would be terribly hard not to get defensive about your wealth and position in life. A very divisive topic.

I studied the sociology of labour and labour economics in school and this was a great update for me as to what's been going on in the last 20 years.

Profile Image for Lisa.
314 reviews21 followers
February 5, 2013
I quit after 55 pages of unorganized drivel about how wonderful it is to be a plutocrat. The author has clearly been rubbing elbows with her subjects too long. There are frequent allusions to winner and losers, and the poor and middle class must simply suck it up and deal, because having the ultra-wealthy around is somehow good for the rest of us. I had my suspicions about the book early on when Freeland unironically quoted the F. Scott Fitzgerald saw "the rich are different" without Hemingway's reply. I gave it another chance. It didn't get any better.
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