The 20 Percent World: Dissaffection

Look around the politics of the Western world, and you’ll see that a lot of once-unthinkable ideas and fringe candidates suddenly have a genuine chance of succeeding. The odds are usually somewhere around one in five — not probable, but possible. This “20 percent world” is going to set the tone in democracies on both sides of the Atlantic — not least because, as anybody who bets on horse racing will tell you, eventually one of these longshots is going to canter home.

.. Corruption and inefficiency — whether in the form of America’s money politics or the EU’s lack of accountability — partly explain why the ills of the Western world have not been solved. But another reason is that problems like inequality don’t lend themselves to easy or swift resolution. A generation doesn’t become educated overnight; an economic realignment brought about by technology doesn’t resolve itself in short order. In other words, the 20 percent world is here to stay. Get used to it.

How to Cover the One Percent: Web Reporting

When donors approach a nonprofit, “they’re more likely to say not ‘How can I help you?’ but ‘Here’s my agenda,’” Nicholas Lemann, the former dean of the Columbia School of Journalism, told me. Mainstream news organizations haven’t caught on to this new activism, he said, adding that most of them are into covering “the ‘giving pledge,’” by which the rich commit to giving away at least half their wealth in their lifetime. David Callahan, the founder and editor of Inside Philanthropy, a website that tracks this world, says that “philanthropy is having as much influence as campaign contributions, but campaign contributions get all the attention. The imbalance is stunning to me.”

.. As John Cassidy observed in The New Yorker, “The more money billionaires give to their charitable foundations, which in most cases remain under their personal control, the more influence they will accumulate.”
.. As a number of the above examples suggest, much of today’s philanthropy is aimed at “intellectual capture”—at winning the public over to a particular ideology or viewpoint. In addition to foundations, the ultrarich are working through advocacy groups, research institutes, paid spokesmen, and—perhaps most significant of all—think tanks. These once-staid organizations have become pivotal battlegrounds in the war of ideas, and moneyed interests are increasingly trying to shape their research
.. Naked Capitalism, an influential financial blog, recently ran a long post about how private equity companies “are far more obviously connected to an undue concentration of wealth at the expense of workers and communities” than are CDOs (collaterized debt obligations) and the other finance instruments that once drew such attention.
.. as Susanne Craig reported in the Times in 2012, the company has exerted “enormous influence as a behind-the-scenes adviser to troubled governments” in places like Greece and Ireland. When seeking to analyze the health of a bank, the US Treasury Department often turns to BlackRock, leading a senior bank executive to call it (in an article in Vanity Fair) “the Blackwater of finance, almost a shadow government.”
.. They described how in the spring of 2012 Google—facing possible legal action by theFTC over the dominance of its search engine—played a behind-the-scenes part in organizing a conference at George Mason University, to which it is a large contributor. It made sure that the program was heavily weighted with speakers sympathetic to Google and, according to the Post, it arranged for many FTC economists and lawyers to hear them. In the end, the commission decided against taking legal action. Just why could be a good subject for inquiry. Today, Google is working hard to protect its right to collect consumer data and to that end has sought the support of conservative groups like the Heritage Foundation. The type of string-pulling described by the Post goes on routinely and deserves more routine coverage.
.. As a 2014 Oxfam briefing paper explained, most of Slim’s wealth derives from his having gained near- monopolistic control of Mexico’s telecommunications sector when it was privatized twenty years ago.
.. Earlier this year, Slim more than doubled the number of shares he owns in The New York Times Company (to nearly 17 percent), making him its largest individual shareholder (though the Sulzbergers retain control). It’s interesting to note that Slim rarely appears in the paper’s news pages. On the surface, this seems a glaring conflict of interest.

This billionaire thinks the Fed is missing the hyperinflation in the Hamptons

His latest investor letter recycles all these ideas, inveighing against the Fed’s “fake prices,” “fake money,” and “fake jobs,” before zeroing in on where inflation is really showing up — his wallet:

Check out London, Manhattan, Aspen and East Hampton real estate prices, as well as high-end art prices, to see what the leading edge of hyperinflation could look like.

That’s right: Paul Singer thinks Weimar-style inflation might be coming because he has to pay more for his posh vacation homes and art pieces.

Now, it’s true, if you’re a billionaire who’s interested in decorating your high-end real estate with high-end art, then, yes, your personal inflation rate is higher than others. But tough luck. (I’m pretty sure you’ll manage). The Fed, you see, isn’t worried about the Billionaire Price Index. It’s worried about inflation on goods and services we all face. And that, despite zero interest rates, is still below the Fed’s 2 percent target. That’s not going to change anytime soon, either. Indeed, just because the super-rich are bidding up the prices of houses in the Hamptons doesn’t mean that middle-class people, whose wages are flat, are going to bid up the price of, well, anything.