Ken Langone vs Pope Francis: Fat wallet, thin skin
Is it a law of evolution that the fatter the wallet, the thinner the skin? The wallet of Ken Langone, the billionaire co-founder of Home Depot, is so fat he he must sit on it funny, yet there he was the other day, crabbing to CNBC about Pope Francis’ missive to the effect that the rich are indifferent to the poor.
Langone was careful to attribute his complaints to an unnamed fellow plutocrat, who being a rich person ostensibly took the Pope’s remarks as an insult. Langone claimed his friend was so upset by the Pope’s remarks that he was reconsidering a donation for the renovation of New York’s St. Patrick’s Cathedral.
If Langone sounds a little like the guy with an embarrassing condition opening his medical consultation with the words, “Doc, I’ve got this friend...,” so be it. Langone told CNBC he advised Cardinal Timothy Dolan of New York that the pope should cool it with the finger-pointing at the rich. (“You get more with honey than with vinegar,” he said.) Dolan promised to explain to the reluctant donor that he was “misunderstanding” the pope’s words and suggested he would explicate the pope’s words in a more emollient way. “And then,” Dolan said hopefully, “he’s going to say, ‘OK, if that’s the case, count me in for St. Patrick’s Cathedral.’”
Remember, this is all about a $180-million project to renovate the big cathedral on Fifth Avenue, which suggests that the priorities of the New York diocese may not leave so much room for “misunderstanding” the pope’s message.
That message, in part, was that “while the earnings of a minority are growing exponentially, so too is the gap separating the majority from the prosperity enjoyed by those happy few.... A new tyranny is thus born, invisible and often virtual, which unilaterally and relentlessly imposes its own laws and rules.”
Langone’s complaint (or his friend’s) is strongly reminiscent of the last outburst of self-martyrdom by billionaires feeling themselves dissed by the outside world. This was the great billionaires’ revolt of 2011, which was spearheaded by the hedge fund manager Leon Cooperman.
Cooperman launched the revolt just after Thanksgiving that year with an open letter upbraiding President Obama for the “divisive, polarizing tone of your rhetoric.” It was the period when Obama was giving speeches observing that “millionaires and billionaires” were shouldering their lowest tax burden in decades and needed to pay their fair share of the cost of running the country. To Cooperman the President’s words threatened to cleave “a widening gulf...between the downtrodden and those best positioned to help them.” (He meant himself and his fellows.)
“People of differing political persuasions can (and do) reasonably argue about whether, and how high, tax rates should be hiked for upper-income earners,” Cooperman wrote; “whether the Bush-era tax cuts should be extended or permitted to expire, and for whom; whether unemployment benefits and the payroll tax cut should be extended; whether the burdens of paying for the nation’s bloated entitlement programs are being fairly spread around...”
Cooperman didn’t take a position on these or other arguments, though his reference to “bloated” entitlement programs rather gave his feelings away. What he chiefly found objectionable, he wrote, was the “highly politicized idiom in which this debate is being conducted.”
Cooperman was joined by Ken Langone for a second letter, this one published as a full-page newspaper advertisement and complaining similarly about “new lows in polarizing rhetoric...aimed at successful people in the business sector.” Obama’s words, the ad charged, “are really just political tricks to distract from the President’s own policy failures.”
Under the circumstances, these complaints seemed hopelessly peevish and petty. After all, as Chrystia Freeland, a veteran financial journalist (and now a liberal member of the Canadian parliament) observed in the New Yorker, “Obama has served the rich quite well.”
He had supported the TARP bailout of Wall Street without insisting on much from the banks in return. By the time of the Coopeman and Langone letters, the stock market had recovered almost all of its losses from the crash of 2008. As economists Emanuel Saez and Thomas Piketty had found, the top 1% had pocketed 93% of the gains from the economic recovery.
Things have only gotten better for them since then. In his latest update of the figures, Saez reports that the top 1% share of income gains in the recovery is up to 95%, and the portion of all income in the U.S. collected by the top 10% has exceeded 50% for the first time. Or at least since 1917, which is as far back as Saez’s records go. The stock market has just notched its best year since 1997, a gain of 32.39% for the Standard & Poor’s 500 Index.
Yet the chief beneficiaries of these trends continue to grouse about being disrespected. Freeland conjectured that they feel that despite their hard work and long hours spent getting to the top of the economic pyramid, they’re disdained as though they’re no better than “a leisured, hereditary gentry.”
To borrow a trope from Cooperman’s first letter, it’s unclear whether they’re articulating a “principled belief” or they’re just being cynical. After all, the working class puts in hard time and long hours too, and for an ever-shrinking share of the national economic pie. The super-rich who complain about the “rhetoric” of the debate over economic inequality are bobbing atop of the rising tide brought in by Obama’s policies while the great mass of their countrymen are still struggling to get to the surface -- helped to a certain extent by those “bloated entitlement programs” Cooperman so casually slandered.
Cardinal Dolan told CNBC that he’ll strive to mollify his reluctant donor by assuring him that the pope didn’t mean to be nasty. “The pope loves poor people, he also loves rich people--he loves people, all right?” If these honeyed words get that donor and others to unbelt for St. Patrick’s, fine. But do they really need honeyed words so much? After all, they already have almost all the money.