Too Much: Fetch a Fortune

	March 26, 2012
THIS WEEK
Wealthy people worried about their health, press reports inform us, have come up with a new strategy for postponing premature demises. They’re installing full-fledged emergency rooms right in their homes, each complete with an array of medical gear that mirrors what the White House has available for the President. The company that installs these emergency rooms charges up to $1 million per installation. For another $6,000 to $12,000 per month, the company offers clients immediate, anytime teleconferencing access to top-notch private physicians. Few of us, of course, can afford our own emergency rooms. But don’t let that unfortunate fact get you too down. Public health experts have some new advice for us. We all don't need our own emergency rooms to have a shot at living in a healthy society, they counseled last week. What do we need? More equality. We have the details — and lots more — in this week’s Too Much.
GREED AT A GLANCE
The world’s super rich are digging deep these days, but not for charity. They’re digging deep to add “trophy basements” to already luxurious manses. Why go low? Mega millionaire Mauricio Oberfeld told the Wall Street Journal earlier this month that he added a 3,000-square foot basement — a space larger than the typical American home — because he doesn’t “like to be ostentatious.” Oberfeld’s unostentatious Los Angeles basement features “an ornately tiled spa.” In the Hamptons on Long Island, builder Joe Farrell’s home now sports a basement over three times larger than Oberfeld’s. His includes a spa, too, plus a squash court, two-lane bowling alley, and skateboard half pipe. But all that leisure can get tiresome. Farrell has his Hamptons hideaway on the market, for $43.5 million . . . The CEO of the holding company that owns retail giants Sears and Kmart has plenty of time to think big thoughts while he commutes. Sears chief exec Louis D'Ambrosio has been shuttling, ever since his hiring a bit over a year ago, between his home in Philadelphia and corporate office near Chicago. What big ideas have occupied D'Ambrosio during all his long commutes? Shutdowns and layoffs, apparently. Sears will be closing 173 stores this year, and as many as 14,000 workers may go jobless. One thing D'Ambrosio never has to think about: how much getting to works costs him. Sears is picking up the entire commuting tab for his air and ground commuting. That came to $803,856 for D'Ambrosio’s first year on the job, says Sears. The rest of D'Ambrosio’s first-year pay deal totaled slghtly under $10 million . . . Average American families with four-year-olds, says the National Association of Child Care Resource and Referral Agencies, spend up to $11,300 for child care over a year’s time. What do ultra wealthy households spend? The Pavillion Agency, a New York outfit that matches deep-pocket parents with top-drawer domestic help, offers the services of one nanny who takes home $180,000 a year, plus a holiday bonus and a $3,000-a-month apartment overlooking Central Park. Elite nannies, says Pavillion executive Seth Norman Greenberg, speak fluent French or Mandarin and can groom a horse. One top Pavillion nanny even drove a Zamboni to clean off her household’s private ice rink.	Quote of the Week “'Big government' isn’t the problem. The problem is the Big Money that’s taking over government. Government is doing fewer of the things most of us want it to do — providing good public schools and affordable access to college, improving infrastructure, maintaining safety nets and protecting the public from dangers — and more of the things big corporations, Wall Street and wealthy plutocrats want it to do.” Robert Reich, former U.S. secretary of labor, The Nation, March 21, 2012
PETULANT PLUTOCRAT OF THE WEEK
The governing business isn’t going too well for embattled Wisconsin governor Scott Walker. His top 1 percent-friendly administration now faces a recall election this June, and prosecutors have filed corruption charges against six of his former aides. Earlier this month an exasperated Walker confided to a conservative activist audience that maybe the time had come to retreat into the private sector to “make some real money.” Walker’s political soul mate in Washington, congressman Paul Ryan, is moving to help his buddy make the most of whatever “real money” he ends up making. Ryan last week introduced a House GOP budget that would slash taxes on Americans making over $10 million a year an average $1.4 million in 2014, about ten times Walker’s current $144,000 salary as governor.	Stat of the Week To earn as much as much as America's top-earning hedge fund manager made for one hour's labor in 2011, calculates economic analyst Les Leopold, the typical America family would have to work 29.2 years.
inequality by the numbers
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IN FOCUS
Is Our Health Care Debate Just a Sideshow? We obsess over health care in the United States, because we all want to be healthy. In the process, new evidence suggests, we're ignoring the social dynamics that actually determine our health. The U.S. Supreme Court this week begins the process of deciding the fate of the Obama health care reform, and much, as the pundits like to say, will be at stake in the high court’s decision. The extent of federal authority. The political momentum into November. Access to health care for millions of Americans. What won’t be at stake in the Supreme Court’s health care reform decision: the ultimate health of the American people. Most Americans, of course, assume otherwise. We’ve become totally accustomed to equating “health care” with “health.” If you have health care, our conventional wisdom goes, you’re going to have health. But that connection — in real life — doesn’t hold. And last week brought stunning new evidence of the disconnect between health care and health from a respected professional journal, the Annual Review of Public Health. The United States, this new evidence shows, has been spending more and more on health care over the last half-century, much more than any other nation, and we have precious little, as a society, to show for that investment. On nearly every global yardstick that measures life expectancy and health, the just-published Annual Review of Public Health analysis shows, the United States now ranks either last among major developed nations or close to it. What’s going on here? Inequality is going on. Inequality generates a chronic stress that saps and zaps our physical health, and no major developed nation has become more unequal over recent decades than the United States. The research on inequality’s adverse health impact has built steadily over recent decades, as the author of the new Annual Review of Public Health analysis, the University of Washington’s Dr. Stephen Bezruchka, knows quite intimately. A Bezruchka essay on inequality and health, published in Newsweek 11 years ago, gave the linkage one of its earliest public exposures. In his new Annual Review of Public Health paper, Dr. Bezruchka brings together for the first time ever all the many metrics that compare nations on how long and how well their populations live, everything from infant and maternal mortality statistics to the numbers on life expectancy at birth and age 50. Some of these yardsticks go back decades, and the United States, decades ago, ranked high on most all of them. In the 1950s, the numbers demonstrate, Americans lived in one of the world’s healthiest and long-lived nations. On maternal mortality, for instance, the United States rated as the world’s safest place for the 1951-1953 period. On overall life expectancy, Americans ranked seventh in the world in the early 1950s, not all that far from first place. But since then dozens of other nations have leapfrogged over the United States in what Dr. Bezruchka has come to call the “health Olympics.” The United States, the latest data detail, ranks 39th in maternal mortality, 34th in life expectancy at birth, and 29th for remaining years of life at age 50.    One somewhat newer global yardstick, Dr. Bezruchka notes, traces how many 15-year-olds die before they hit 60. The United States, on this metric, ranks 44th in the world. American males at age 15 now have “twice the chance of dying” before age 60 as have 15-year-olds in this category’s top-ranking nation. These American 15-year-olds are living in a society that outspends every other nation on earth — by a vast margin — on health care. In 2009, the $2.5 trillion the United States spent on health care represented 42 percent of the entire world’s spending on health care. Why haven’t America’s vast outlays on health care produced better health outcomes? Dr. Bezruchka discusses — and dismisses — the various rationalizations for America’s declining global health standing. Some blame the low U.S. rankings on the increased immigration of unhealthy people into the United States. But Americans of Hispanic origin, Dr. Bezruchka notes, turn out to “have better health status than do non-Hispanic whites.” Others blame Americans’ poor personal health habits. But Americans have better personal health habits — lower levels of smoking, for instance — than people in many more longer-lived nations. Access to health care doesn’t explain the poor U.S. global health standing either. Americans with access to health care don’t live as long or as well as their counterparts with access to health care elsewhere in the developed world. We can only make sense of America’s declining global health ranking, Dr. Bezruchka posits, if we look at the nature of our social relations, most particularly at how economically unequal the United States has become since the middle of the 20th century. Health care, as Dr. Bezruchka points out, “mainly treats disease manifestations later in life.” Health care cannot treat the basic “social determinants” of health that make and keep us sick. And just how does inequality make us sick? Another veteran observer of the American health scene, American Journal of Health Promotion editor Michael O’Donnell, has just taken a noble stab at an explanation in a passionately penned column just published in his journal’s most recent issue. What difference does inequality make? The more unequal a society, O’Donnell explains, the more people “judge themselves negatively relative to other people” and the more they feel threatened. This sense of threat has a biological impact. The stress triggers the “release of cortisol and pro-inflammatory cytokines” that wear down human immune system functions and invite a wide range of diseases and disorders. The heightened “importance of maintaining status” in an unequal society, O’Donnell adds, also “increases the social pressure to divert limited financial resources” away from basic necessities that help preserve good health to purchases that signify higher social status — or to outlays for drugs or drink “to help cope with the stress.” Elevated stress, O’Donnell’s American Journal of Health Promotion editor’s column continues, can be especially damaging during pregnancy, “increasing the likelihood of low birth weight, premature birth, or other congenital defects.” Against all these dynamics, modern medicine in and of itself can only have a limited impact. In fact, notes Dr. Stephen Bezruchka’s Annual Review of Public Health analysis, if modern medicine somehow eliminated all U.S. cancer deaths, average American life expectancy would increase by just three years, not enough to cover the life expectancy gap between the deeply unequal United States and the much more equal Japan, the nation with the world’s longest life expectancy. For better health, in short, we need a political overhaul that encourages a substantially more equal distribution of income and wealth. “Medicine and politics,” as Dr. Bezruchka concludes, “cannot and should not be kept apart.”	New Wisdom on Wealth Eduardo Porter, Inequality Undermines Democracy, New York Times, March 20, 2012. Our growing income gap “has bred a gap in political clout that could entrench inequality for a very long time.” Alan Dunn, Average America vs the One Percent, Forbes, March 21, 2012. A serial entrepreneur explains why wealth that concentrates at the top signifies “a suffering economy.” Mark Ames, The One-Percent’s Doctrine For The Rest Of Us, The Exiled, March 22, 2012. In the modern U.S. economy, the "best-performing" firms and CEOs turn out to be those those squeeze employees the most. Richard Schiffman, The rich really are different, Philadelphia Inquirer, March 23, 2012. Many wealthy people, research shows, are losing the capacity to imagine life on our great divide's other side.
In Review
Fetch, Rover, Fetch! Fetch a Fortune! Frances Foster, Should Pets Inherit? Florida Law Review, July 2011. Five years ago, billionaire hotelier Leona Helmsley — the arrogant “queen of mean” who at one point had gone to jail for tax evasion — died at the age of 87. Helmsley's exit would generate quite a hefty hubbub. The reason? She left $12 million to a dog named Trouble, her beloved poodle. Comedians and columnists would quickly have fun aplenty with Helmsley’s generosity. Dogs, one commentator quipped, make for “notoriously bad money managers.” But the Helmsley bequest, law prof Frances Foster argues in this rather fascinating Florida Law Review article, actually raises serious concerns about our contemporary inheritance law that go well beyond matters canine.     The basic issue: Our current inheritance law privileges a decedent’s “closest relatives by blood, adoption, or marriage” and “exalts family status over affection, support, and behavior.” If you die without a will, those “closest relatives” automatically inherit what you leave. The daughter who abandoned her father, Foster points out, inherits. The old friend “who shared his life does not.” We live, Foster argues, in a world increasingly full of nontraditional families. In this world, the traditional “family paradigm” now sits obsolete. Sticking to it “denies inheritance rights to the very individuals” the departed consider their “nearest and dearest.” Sometimes these “nearest and dearest” have four legs. Foster wants to see new laws on inheritance that help society better identify and respect “decedent intent,” and she introduces us to a series of average decedents who had their intent ignored, people who sought nothing more than decent care for their pets. They didn’t get it. Courts threw out their wills. These pet owners deserved better, Foster contends. They weren’t asking too much. But they couldn’t afford the ace legal help necessary to make their modest wishes stick. Concludes Foster: “The plight of decedents‘ pets exposes a larger systemic flaw — inheritance law‘s outdated family paradigm.” But the plight of pets like Leona Helmsley's Trouble — who ended up with $2 million — exposes an even larger systemic flaw. We have an inheritance system that lets the holders of grand private fortunes make decisions that significantly impact society long after they’ve departed from it. These decisions can be silly. No pet needs $2 million to live out life in comfort. These decisions at other times can endanger our democracy. Bequests of grand fortunes — in and outside the traditional family paradigm — can lock into place an aristocracy of wealth that undermines our deepest values.