Sunday, June 23, 2013

Wealthy and Weak

Dr. Dawson has lamented Lou Reed's prostitution to big marketers:

The latest greedfreak to take a dive onto the sword that is the Hicks Dictum* is none other than Lou Reed, he of the supposed avant garde. According to Advertising Age, visiting on tape at the Cannes crapfest with “Tim Mellors, vice chairman and chief creative officer at Grey Group,” Reed said this:

“Ad people play fair with you. A is A, B is B, C is C.”

...That a human being with pretensions to thought and social conscience could have run through the amount of money Reed has devoured and then turn around and say such howling, sycophantic garbage is yet another notable Orwellian aspect of our late capitalist epoch...

*The words of the late Bill Hicks: “Do a commercial, you’re off the artistic roll call. Every word you say is suspect. You’re a corporate whore and eh, end of story.”
To which we say, "Hey, gotta feed the monster."

One-off celebrities don’t tend to have the kind of influence that long-established lines do. Established elites were able to get rid of Shakur and Lennon rather handily when the latter pair refused to play ball. When Tupac died, people were shocked that, despite several platinum albums, he didn't even legally own the house he lived in. It wasn't really a shock--a lot of young black stars get completely shafted by the financiers who control their earnings.

There's an aspect of self confidence and popularity there also, particularly when you're getting older and realize that you're not longer young and hip anymore. No matter how rich you are, elements of relevance and influence can make you feel worthless. Fronting products sold to young people can make you still feel relevant.

...which is massively sad, and which does not exonerate him in the slightest.

A lot of the one-time artist wonders, like the professional athletes, are different than, say, George Clooney. They got where they are simply by talent and passion, rather than family connections. Once they're at the top, they're incredibly easy pickings for powerful brokerage/law/accounting firms, real estate interests, and entertainment conglomerates.

Remember Trent Reznor, or many of Bernie Madoff's clients: being "rich" does not make you immune from the system. All you are is living "proof" that "anyone" can make it. In exchange for living in a mansion, driving fast cars, and banging groupies, you turn over your life to the businessmen who truly understand what it means to be "worth" $20 million. Ben Bernanke's nameless friends are far more evil and powerful than the snobbiest rock star to ever throw bottles of Dom at the housekeeping staff.

The personal finances of a lot of younger, rural white or African-American basketball/football ultra-rich are abhorrent. Because they don't understand stocks, bonds, commodities, real estate, et cetera--and they know it, and are made to be ashamed about it--they turn over almost all of their affairs to the undying class of major banks and investment houses. Those places lock up their wealth in absurd "retirement plans," using contractual rules with team- and league-owners to control players' (and artists') access to liquid funds. Any "irresponsible" investing or spending choices are met with a horde of managers, including people from the record company and/or sports team, who scold the person for being selfish and arrogant. It's not a joke: record deals or next-season's contracts can literally depend on how willing the "superstar" is to sign over their investments to old money.

Sure, the superstar gets a Ferrari, a house in the hills, and gets flown (by the company) all over the world to eat at nice restaurants. $4-5 million in expenses, right? But who controls the governments that collect property taxes and sales taxes on everything the superstar buys? Who owns the construction company that built the mansion, and the developer that developed the land? Who owns stock in Ferrari to make the car, CSX shipping to ship the car, the dealership that marked it up, and the bank that financed it at the dealer and consumer level?

Even when superstars spend money, all they're really doing is cycling it through the system of thousands of middlemen that takes cuts out, at every level, for the already-wealthy. And who built that mansion? Who trims the grounds? Who washes the Ferrari and takes it for an oil change? That's right--a bunch of poor California Hispanics, or rural whites shipped into the city for superstar labor. The elites are not doing any of the work; it is a simple task to redirect a few luxury toys to the occasional one-hit wonder to make them feel that they've "made it."

That's why it's such a big deal when an actor, player, or musician gets the freedom to do something like start a pukey theme restaurant or a production company: it represents a level of savviness where they've at least wrested some of their investments away from the old-line bankers, and are trying to found independent power. Not just the "wealth" aspect of it, but the ability to control and direct that wealth.


  1. Why is it so hard for the occasionally suddenly rich to simply retire, downsize, and have a fulfilling and comfortable life - which even the con annuity schemes can provide - living simply,doing whatever they want, travelling the word, read a book, be amused by kids etc.?

    At least some of them ought to have enough self-awareness to see the precarious situation of a-lot-but-not-too-much-money? How is being stuck on the treadmill any better, even if it means a bit more luxury. (I personally wonder what's in their heads, because I am barely at the solid middle class and yet I'm already looking for ways to work less - not because I couldn't use the money, but because getting more is only possible through continued whoring...)

    1. It seems silly, but it's easy for a recession to wipe out even large holdings, like $10 or $14 million. That's why recessions are held so often--not just to knock out the middle class, but to water-down the talented wealthy.

      Corporations stop paying dividends, and banks stop paying interest, which forces the lower-upper-class to start selling their holdings in order to pay for basic living expenses. Portfolio value drops by the millions during the recessions, as stocks and currencies are artificially devalued.

      Again, it will seem silly, but imagine that you were worth $14 million (Lou Reed's estimated figure, courtesy a gentleman at Dr. Dawson's site), and then there was a recession. Stocks drop around 30%, so you're then worth $10 million.

      In the meantime, you're still getting assessed 30 grand in yearly property tax on your house (which has taken a massive value hit). You have to register your vehicles, buy insurance, pay the doctor, buy food, et cetera. You're getting older, facing normal considerations like $12K monthly rent in assisted living facilities (we may be lowballing for southern CA), taking care of loved ones, and potentially having surgeries or more expensive health situations arise.

      Suddenly, you realize that you're not that far from having to downsize to a "normal" life. A comfortable life, yes, but a life where you live on a publicly accessible street. All of a sudden, every person who had a problem with your public image will be able to ring your doorbell, send you mail, and call your telephone.

      U.S. Presidents get Secret Service protection for life, but celebrities don't. If you're not able to pay a private security firm anymore, you become publicly accessible--which could be a threat for some people. Remember the Scarlet Pimpernel and Batman, right? The rich are aware of how important it is to be able to stay inaccessible.

      Once you do downsize to upper middle class life, it keeps on dropping. Your property taxes go up; your broker screws you a little more; the water heater breaks; you have to go to the ER; a tree branch crumples the hood of your car. The arrow is pointing straight toward solid middle class.

      And below solid middle class is lower class, and below that is the street.

      I'm not throwing a pity party for Lou Reed, or other rich celebrities. However, some of them are aware--as are we all--that in the society with no guarantees, we're all not that far away from starving in the park.

      (Oh, and remember also--if you drop out of the upper class, all of your friends instantly abandon you. You become an untouchable leper, and the corporate media makes sure that you are called a reckless drug and sex addict who ruined your life due to irresponsible spending, which is shorthand for "Didn't let the investment firm manage all your money forever." The entire country unites in mockery of your outlandish spending habits, and laughs at your descent.)

  2. OMG, that is indeed horrible. One of the examples is Nicholas Cage, who actually tried to sue his money manager, but ultimately got mocked at all levels.

    I missed the part how much it costs to be insulated, but I have to wonder though - as the self-insulation of the elites becomes ever more logistically challenging and capital intensive (private ships, private jets, private airports, fortified enclaves, private cities, private islands, private supply chains etc.) how sustainable that is?

    Such complex systems require quite a bit of cooperation and maintenance, and what happens when the poor are simply too many? Is it just a matter of installing self-firing machine guns (yes, these horrors exist already) on every corner, or genocide? And if not, what good is insulation if it ultimately also means an easily encircleable location. Cut their water, cut their power, and just wait them out, no?