Should we rent or should we buy? Middle-income families ask themselves that question all the time. But these days so do the fabulously rich. The rise of “the increasingly itinerant global rich,” notes CNBC analyst Robert Frank, has sent the demand for luxury rentals to record heights. How high do these heights go? In hot spots like Manhattan, Miami, and Beverly Hills, units renting for $100,000 per month now raise few luxury realtor eyebrows. New York currently hosts at least seven $100,000 publicly listed rentals. Some run higher into the six figures. One apartment that composer Cole Porter called home in the 1930s comes with five bedrooms and twice-daily maid service. Only $150,000 at the monthly rate . . .
Carlos Ghosn, the CEO of the Nissan autoworks since 2001, has become the highest-paid corporate exec in Japan. Ghosn last week announced that he took home $12.38 million in 2011, an enormous windfall by Japanese standards. Ghosn’s top competitor, Toyota CEO Akio Toyoda, only earned $1.7 million last year. Ghosn’s Nissan paycheck in 2011 totaled more than the entire combined pay that went to the top 21 executives at Sony. But Ghosn apparently feels underpaid. His top U.S. automaker rival, Ford’s Alan Mulally, pulled in over twice his pay, $29.5 million, and nine other U.S. CEOs grabbed over $30 million in 2011. Japan, says Ghosn, is “going to have to make more investments in executive compensation” to remain “competitive” in world markets . . .
If stuffing CEO pockets made economies more “competitive,” then the most competitive nation on Earth ought to be the United States, home to the world’s most highly compensated CEOs. But a new report from the OECD, the economic research agency for developed nations, says the United States is “stagnating” on the innovation front and “slowly slipping down the global rankings” for coming up with “valuable new products or processes.” The OECD study, released last week, rates the U.S. capacity to innovate as no better than “average.” Where the United States remains distinctly above average: its level of economic inequality. That level, says the OECD, “has continuously increased over the last four decades.” High-income Americans, the OECD urges, should pay more in taxes.
Quote of the Week
“Apple is rapidly becoming the symbol of what’s wrong with our economy: a highly profitable enterprise where all the gains go to those at the top and the vast majority, including those with college degrees, struggle to get by.”
Larry Mishel, Working Economics, June 25, 2012
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THIS WEEK July 2, 2012
In July 1776, only about 2.5 million souls lived within the confines of the newly independent 13 American colonies, about the population of today’s Denver area.
But a great deal more than population size, of course, separates all of us from the generation of 1776 we fete this week. We live, for instance, in one of the world’s most unequal nations. They didn’t.
This week in Too Much we explore the egalitarian back story to the original red, white, and blue. Our contemporary fans of grand fortune always do their best to blur this story. The rest of us can’t afford to let them.
So this Fourth of July holiday week, why not share this issue of Too Much with a friend who could use a little hidden history. Too Much, by the way, will be going on a little holiday break the next two weeks. We’ll be returning later this month. In the mewantime, keep cool — and stay committed! Continue reading »
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