Nobody You Would Ever Know : PEOPLE LIKE US<i> by Dominick Dunne (Crown: $19.95; 403 pp.) </i> : PRIVILEGED LIVES<i> by Edward Stewart (Delacorte Press: $18.95; 512 pp.) </i>

“What have you got with short chapters, about rich people?” asks the senator’s widow of her Madison Avenue bookseller in Dominick Dunne’s latest novel. The implied answer (and one of the book’s better jokes) is “People Like Us,” which in the course of its 403 pages (and 54 chapters) details the clashes between Old and New Money in New York during the months leading up to Black Monday. At an average of just over nine pages per chapter, Edward Stewart’s “Privileged Lives” operates likewise on a principle announced by one of its characters, that “Folks in Kansas and Osaka can’t get enough of the private lives of society’s public people.” Both novels depict moneyed Manhattan in so complete a state of moral disrepair, however, that readers may emerge from the narratives much as we do after our first glimpse of drinking water through the microscope: rather wishing we hadn’t been shown all the stuff really happening in there.

“People Like Us” belongs loosely to the Gatsby tradition in American fiction, in which the novelist tries simultaneously to evoke a privileged society and exorcise his own private demons. But its form is more nearly journalistic: something like the effect of the gossip and agony columns grafted together. Its plot is almost negligible. We follow the mostly independent lives of a number of New York’s have-mores through the rather voyeuristic eyes of a divorced, middle-aged writer whom they have admitted to their social midst and selected (unconsciously, it seems) as their confidante and chronicler. This writer, given a mysterious Hollywood past and called Gus Bailey, is of course a version of Dunne himself.

Old Money in the novel is represented by the regal Altemus family, and especially by its matriarch Lil (born a Van Degan), for whom “there were only ten buildings in Manhattan where people like themselves could live.” (We are also informed that “Earned money, no matter how abundant, never impressed Lil Altemus the way inherited money did.”) Lil’s views are undercut, however, by what we see happening in her family. Her heiress daughter Justine marries and divorces a philandering television anchorman; her son Hubie is arrested for lewd conduct in Central Park and contracts AIDS from a Puerto Rican boyfriend (Lil steadfastly maintains that “people like us” don’t get this illness); her father engages in sexual acts with Dodo Fitz Alyn (“a Van Degan poor relation and the object of family jokes”) while watching pornographic videotapes.

New Money seems only marginally more appealing here. Perhaps the novel’s central story concerns the rise and fall of Elias Renthal, a Ivan Boesky-like inside trader and corporate raider, crude but somehow likable, whose seed money has come from airplane wheels and hamburger franchises. Dunne depicts a world in which Old and New Money, though natural adversaries, profit from their mutual association: New Money seeks style and social standing; Old Money seeks simply more money. Thus Renthal advises Lil’s brother on the stock market and is admitted to the prestigious Butterfield Club in return.

Some readers will doubtless derive vicarious pleasures from the uncommon diversions here depicted. (Mrs. Renthal, for example, shops for furniture by taking the family jet to London auctions.) And they may be reassured about the advantages of their own penury by the recognition that no one here is especially happy.

For me, the novel fails as fiction (however intriguing it might remain as journalism) because its various stories are so superficially and episodically crafted. It’s difficult to care very much about these people, and impossible to be surprised by anything that happens to them. “People Like Us” is a triumph of the powers of observation--over the powers of invention.

Dunne’s problem may stem from the fact that he becomes distracted from his task as social historian by an incompatible autobiographical impulse. He gives his alter ego Gus Bailey a daughter who has been strangled by a former boyfriend, and he devotes much of the book to Gus’ plotting of revenge against this man, who has received an absurdly lenient prison sentence. To most readers, this will all sound very familiar. Dunne has written movingly in Vanity Fair about his own daughter’s murder. One can also sympathize with his desire to use fiction as a further act of expiation and catharsis. But the handling of this revenge story, besides feeling utterly disconnected from the novel’s “people like us” focus, suggests that Dunne has ironically fallen victim to the very infirmity his ostentatious characters share: an almost pathological need to make everything about themselves public. Like many physicians before him, Dunne seems to have contracted the virus he sought to diagnose.

“Privileged Lives” is part police procedural and part high society procedural; it too is set in a contemporary Manhattan where “shrill is beautiful” and “ostentation is the rage.” Stewart splices two seemingly independent stories together here. The first, and less engaging, centers on Babe Devens, a beautiful heiress and fashion designer who awakens after a seven-year coma (induced, shades of Von Bulow, by a mysterious injection of insulin) to pursue the question of who among her family and friends has attempted to kill her. The more effectively-realized story begins with the discovery of a mutilated corpse in an empty midtown co-op apartment. Investigating both cases and eventually discovering the trail of drugs and dollars that links them, Lt. Vince Cardozo seems out of place in this luxurious world as he scrapes by with a 4-year-old Honda Civic and a $48,000 salary.

Stewart’s plot at times strains credibility (Vince and Babe improbably fall in love), and his research into police methods occasionally reads like research. But this is a fairly gripping novel, very much in the Lawrence Sanders “Deadly Sins” mode. If it (like “People Like Us”) essentially reduces to the absolute statement that the very rich are very depraved, that’s a homily that a lot of us have apparently found comforting down through the years.