Forbes Ranks Kluge as Richest American : Walton Ends 4-Year Reign by Dividing Fortune Among Children
Metromedia Co. Chairman John Werner Kluge is worth an estimated $5.2 billion, but he had to back into first place on Forbes magazine’s annual list of the 400 richest Americans.
Kluge displaced Sam Walton, head of the Wal-Mart stores discount chain, who divvied his $9-billion fortune among himself and his four children and ended a four-year reign as Forbes’ wealthiest person.
Among other notables on the list, developer Donald J. Trump compounded his already considerable fortune and financiers Michael Milken and Carl C. Icahn joined the billionaires club.
Overall, Forbes’ richest are worth an estimated total of about $269 billion, up nearly $50 billion from the previous year, a 22% increase that substantially outpaced last year’s 4.4% inflation rate.
Prototypical Member
By comparison, the total wealth of the richest would come just short of bailing out the nation’s failed savings and loans over the next 30 years, the cost of which was estimated by Congress at $285 billion.
The list, released Monday, appears in the Oct. 23 edition of Forbes and is based on estimated holdings as of Sept. 8.
The prototypical member of Forbes’ ultra-rich was a 63-year-old male with 3.1 children who has been married 1.4 times and had a net worth of $672 million last year, more than the gross national product of Lesotho, Forbes stated.
For the richest, the last year has been a very good one. Many of the wealthy rebounded nicely from the October, 1987, stock market crash.
The number of billionaires increased to 66 from 51. The minimum net worth to make the list rose to $275 million from $225 million.
At the pinnacle was Kluge, 75, of Charlottesville, Va., whose holdings rose an estimated $2 billion from last year thanks to a tripling in the value of his holdings in cellular telephones, Forbes said.
Kluge moved up from the No. 2 spot. The magazine noted that “klug” in German means smart.
For Walton, charity began at home. The 71-year-old from Bentonville, Ark., who milked cows during the Depression to support his family, split his Wal-Mart and other assets equally with his four children. While the family’s total holdings increased to $9 billion from $6.7 billion, the individual family members tied for 20th on the list.
Moving up to second from 12th place was investor Warren Buffett, 59, of Omaha, Neb., the head of Berkshire Hathaway whose stock market-based fortune nearly doubled to $4.2 billion. Behind him was Sumner Murray Redstone, head of National Amusements Inc. and entertainment giant Viacom, with $2.88 billion.
New Billionaires
America has more billionaires than any other nation--Japan is second with 41--but the richest of the rich live abroad.
Kluge’s fortune makes him the ninth-wealthiest private individual in the world, according to Forbes. He is topped by six Japanese, a South Korean and Canadian publisher Kenneth Roy Thompson. Japan’s Yoshiaki Tsutsumi, who made his money in land, railroads and resorts, is worth about $15 billion, Forbes said.
Eighteen new billionaires joined the Forbes American list, including Laurence and Robert Tisch of Loews Corp. at $1.36 billion apiece, entertainment mogul Kirk Kerkorian at $1.29 billion, indicted junk bond financier Milken at $1.27 billion and TWA boss Icahn at $1.2 billion.
Trump also was among the individual standouts, adding $700 million to his empire of hotels, casinos and an airline for a $1.7-billion total.
For the second straight year, the youngest self-made billionaire was 33-year-old William Henry Gates III at $1.25 billion. Gates dropped out of Harvard University to found Microsoft in 1972.
St. Louis beer and baseball magnate August Anheuser Busch Jr., who died on Sept. 29 at age 90, was included on the list with $1.5 billion. Forbes said it compiled its profiles before the death.
The youngest on the list is 32-year-old Caroline Marie Getty, daughter of the late George Getty, with her $330-million inheritance. The oldest of the wealthy remained 94-year-old Mansfield Freeman of Greensboro, Vt., who holds a stake in the insurer American International Group, with $360 million.
Among the losers were real estate investor and builder Fred Trammell Crow, whose net worth, Forbes estimated, sank to $300 million from $775 million, thanks to softness in commercial real estate. Penthouse publisher Bob Guccione slipped into something less comfortable and dropped off the list.
New York Address
The list contains 346 men and 54 women; 159 inherited their wealth; no one from Maine, North Dakota or Alaska qualified; Yale had 22 of the richest, Harvard 17 and the University of Pennsylvania 12; the 45 with master’s degrees in business had an average net worth of $895 million, while the 10 high-school dropouts had an average of $854 million.
About 20%, or 82, of those listed live in or near New York City, with Los Angeles second in plutocratic residences with 32 and San Francisco third at 19. Twenty-one people on the list own at least one-third of a major league sports franchise.
Publisher Malcolm Forbes included his own biographical data and reported estimates of his net worth but refused, as usual, to divulge his wealth. Forbes’ sketch was included in the under-$500 million category. “I’m solvent,” he said.
