Zero Sum Empire A Census of the Billionaire Class

Housekeeping: We take a minute at the start to talk about a new segment we are introducing, tentatively called “The Mindset Segment.” We are taking suggestions for a better name.

In the News: Only one topic this time: The Pandora Papers. A massive leak of private financial records revealed that the world’s wealthiest and most powerful people siphon wealth into black holes of secret offshore accounts, and most of it is perfectly legal. We already knew this, but I guess we know it even more now? We also talk a little bit about how both tax evasion and financial records leaks have changed as a result of The Computer Age.

Billionaire #1: Jay-Z 1/10 on the David Koch Memorial Asset Liquidation Index

As Joe points out, it would be extremely unusual if you, the person reading this, did not already know who Jay-Z is so I’ll skip the bio. Joe soft launches the mindset segment with an exploration of the key concept of Jay-Z’s career and outlook: Hustling. We talk a bit about the history of the concept of hustling, from the con artist to Black hustling to “hustle and grind” people. In the end, though he was at one time a crack dealer, it doesn’t seem like Jay-Z has done a tremendous amount of harm compared to most of the people we talk about, so he only got a measly 1.

Billionaire #2: John Catsimitidis: 6/10 on the DKMALI

John “Cats” Catsimitidis made his fortune with a chain of Manhattan supermarkets called Gristedes. He is a mean, paranoid man who uses his great wealth to spread hatred and fear of the powerless and vulnerable. Lucky for us, he’s incredibly ineffective. He’s very involved in New York Republican politics, as are his children. If you want to get a sense of who he is, just imagine a guy who believes all the same things as Rudy Giuliani but is less articulate in expressing those ideas.

Links:
https://www.icij.org/investigations/pandora-papers/global-investigation-tax-havens-offshore/?utm_source=pocket_mylist

Jay-Z:

Subway lady:
https://www.youtube.com/watch?v=lydYYyD9c_A

Dyson bio:
https://www.amazon.com/JAY-Z-America-Michael-Eric-Dyson/dp/1250230969

Catsimitidis:

Unanue Humanitarian Award: https://www.amny.com/news/goya-foods-president-robert-unanue-receives-humanitarian-awards/?utm_source=pocket_mylist

Cats family takes over NYC GOP: https://www.nytimes.com/2020/10/17/nyregion/giuliani-republican-party-nyc.html?utm_source=pocket_mylist

Story on Cats’ Daughter: https://guestofaguest.com/new-york/nyc-society/the-tackiest-heiress-in-new-york-is-also-the-face-of-the-manhattan-republican-party?utm_source=pocket_mylist

Editorial by Cats and Bernie Marcus: https://www.wsj.com/articles/making-money-is-a-patriotic-act-11565737046?utm_source=pocket_mylist

We’re adopting a new episode naming strategy. We’re doing descriptive titles. Complaints will be stored in the cylindrical file!

In the News: We discuss the recent outer space adventures of three people so impossibly wealthy that they each had vanity fleets of rocket ships built for them, seemingly to reaffirm their unshakeable sense that they were each earth’s main protagonist.

Billionaire #1: Steven A. Cohen 8/10 on the David Koch Memorial Asset Liquidation Index

Welcome to Flavortown! Steven A. Cohen is probably best known for owning the Mets, but a few years ago his firm SAC Capital Advisors was caught up in the biggest insider trading investigation in history. Hedge funds are machines designed to widen the wealth gap between the richest micron of elites and everybody else. They are also often criminal enterprises—organized ways to cheat the markets without getting caught. Steven A. Cohen was the all-time biggest cheat, but he never really suffered any consequences and now he just buys the world’s most expensive artworks and sports teams. He also reportedly paid Guy Fieri $100,000 to recreate an episode of Diners, Drive-ins, and Dives with him.

Billionaire #2: David Hindawi 2/10 on the DKMALI

David Hindawi is a ghost man who started a cybersecurity firm. His son seems like a very uncool boss. Joe takes us on a journey through cybersecurity, John McAfee, information infrastructure, risk society, Batman, and anxiety. I think the takeaway was that there are specific anxieties and fantasies associated with the information infrastructure we’ve erected around ourselves. We are all over the place here, but I think it was a fun conversation.

Links:
https://www.goodreads.com/book/show/25814289-dark-territory
https://www.bloomberg.com/news/articles/2017-04-13/tanium-s-family-empire-is-in-crisis
https://www.tripadvisor.com/Hotel_Review-g580328-d573907-Reviews-Daurada_Park-Cambrils_Baix_Camp_Costa_Dorada_Province_of_Tarragona_Catalonia.html
https://www.thefiscaltimes.com/Columns/2012/03/05/Insider-Trading-How-Hedge-Funds-Look-for-an-Edge
https://www.newyorker.com/magazine/2014/10/13/empire-edge
https://www.newyorker.com/magazine/2017/01/16/when-the-feds-went-after-the-hedge-fund-legend-steven-a-cohen
https://www.nickiswift.com/15287/shady-side-guy-fieri/
https://en.wikipedia.org/wiki/The_Physical_Impossibility_of_Death_in_the_Mind_of_Someone_Living

Billionaire #1: Bruce Karsh: 3/10 on the DKMALI

Joe introduces us to Bruce Karsh, a vulture investor. Vulture investors buy distressed securities from failing companies or people, and then use legal and financial advantages to increase the value of that debt. We have a long discussion about an academic article that argues vulture investing is ethical. Seems weird that someone would have to do that. In our opinion, it’s generally not a good sign when you have to develop byzantine philosophical arguments to convince people that the thing you’re doing to make money isn’t as extremely unethical as it seems. While Karsh made his money in a pretty awful way, he otherwise hasn’t done much that we could find, so he only gets a 3 on our rating scale.

Billionaire #2: Bernie Marcus: 8/10 on the DKMALI

Bernie Marcus was one of the founders of Home Depot. Chad doesn’t say too much about Home Depot itself. Instead, he focuses on other dimensions of Marcus’ life, including his self-mythologization, his political and philosophical views, and his propaganda outfit the Job Creators Network. Although Marcus has made a big name for himself in the philanthropy game, he has done even more work to lobby against social programs that might actually help with the causes to which he donates money. Marcus is a true ideologue, a free-market fundamentalist to the core.

Links:
Vulture Investors article:
https://link.springer.com/article/10.1023/A:1005718715162
Job Creators Network sampler:
https://www.youtube.com/watch?v=03bmtmDvoA0
https://youtu.be/13CJO7BVEYk

David and Rick Berman
https://www.brooklynvegan.com/silver-jews-end/
https://www.nytimes.com/2014/10/31/us/politics/pr-executives-western-energy-alliance-speech-taped.html?_r=1

https://www.motherjones.com/politics/2015/03/rick-berman-job-creators-network/

Zero Sum Empire's hosts have had a busy year that included two new babies and entirely relearning our day jobs because of the pandemic, and that's made us a little slow putting episodes out. Sorry everybody! Thank you for sticking around. We are mentally, physically, and emotionally recommitting to our once-per-month release schedule.

This week in the news we mostly discuss the Amazon unionization drive in Bessemer, AL. We also talk about a rash of billionaires dying in helicopter crashes. If you're a billionaire, your chances of dying in a helicopter crash are around 1/500.

Billionaire #1: The Bass Brothers, 6/10 on the David Koch Memorial Asset Liquidation Index

All of the billionaires in today's episode happen to be Texans. Lots of big, beefy boys in the bunch. The Bass brothers inherited their fortune from their uncle Sid Richardson, one of the big mid-20th century Texas oilmen. We spend most of our time talking about Richardson and his partner Clint Murchison. Although most people have probably never heard of these guys, they had every president from FDR to Nixon doing personal favors for them. They were two of the five richest people in the US for a time. They funded LBJ's political career and had bunga bunga parties with J. Edgar Hoover and Joseph McCarthy. Also, they made their fortunes by running criminal enterprises that used political influence to avoid having to obey laws.

Billionaire #2: Janice McNair (and son), 7/10 on the DKMALI

Janice McNair owns the Houston Texans NFL team. She also has a large adult son, Cal, who has been compared to Billy Madison. For some reason, he runs the team. He also hired an evangelical life coach named Jack Easterby as Executive Vice President of Football Operations. Easterby is a wild character who seems to have fallen fully formed from Danny McBride's brain. Janice and Cal McNair are trying to "be better" after husband/dad Bob McNair got in trouble for making racist comments.

Links:
Bass Bros:
https://www.sandiegoreader.com/news/2011/jan/05/cover-oil-politics-la-jolla/
https://en.wikipedia.org/wiki/The_Big_Rich
https://www.washingtonpost.com/archive/opinions/1995/06/24/the-bass-dispute-at-yale/03c68321-5857-4fdf-a4f5-223973a645fb/
https://www.dailymail.co.uk/news/article-2161030/Hyatt-Bass-adds-security-Manhattan-home-mother-Anne-held-hostage-Connecticut.html

McNairs:
https://www.si.com/nfl/2020/12/10/ex-chaplain-jack-easterby-houston-texans-chaos-after-power-struggle-daily-cover
https://www.si.com/nfl/2018/04/05/texans-bob-mcnair-inmates-comment

Billionaires in the News: Zero Sum Empire goes international. There were two strange international billionaire stories we wanted to talk about: the death of the world’s richest banker, Joseph Safra, and the deadly poisoning of Chinese billionaire Lin Qi. Our last story is about the Corporate Transparency Act that was just passed as part of the defense spending bill. Surprise! It will do very little to mandate corporate transparency for the corporations and LLCs run by the rich and powerful.

Billionaire #1: The Ziff Brothers, 3.5/10 on the David Koch Memorial Asset Liquidation Index (DKMALI)

Joe introduces us to the Ziff brothers. The brothers inherited their wealth from their magazine publishing magnate father. Instead of continuing in the publishing business, they decided to create an investment firm. The brothers gave Joe the opportunity to investigate family offices a little more, as he promised last episode. The rise in popularity of family offices should be linked to the increasingly oligarchic control of the planet. It’s a consolidation strategy that provides greater cover from scrutiny for the super-rich. Do you remember that the Ziff family was embroiled in the infamous Manafort/Kushner Trump Tower meeting with Russian lobbyist Natalya Veselnitskaya? I didn’t! Joe also goes over some of Dirk Ziff’s (that’s his real name) other assets, which you’ll want to stick around to hear about.

Billionaire #2: Scott Cook, 5/10 on the DKMALI

Scott Cook is a boring man. He started the software firm Intuit, and if you’ve ever used TurboTax, then you’re familiar with at least one of the company’s products. Chad discusses a story some of you may have heard about from last year involving Turbotax, which involves a controversy that’s a little too complicated to explain in the show notes. However, please heed this Public Service Message: you can almost certainly use TurboTax for free and you should. Chad then discusses how the practice of double-entry bookkeeping (which is what Intuit’s bread-and-butter product Quickbooks does) is the notation system that makes modern capitalism as we know it possible. Double-entry bookkeeping is a necessary precondition for any capitalist system that extends beyond limited, local boundaries. P.S., in case you didn’t recognize it, the final clip is from The Grapes of Wrath.

As always, thanks for listening! Tell you friends. Leave a review.

Links:
Ziff Bros:
https://www.motherjones.com/politics/2017/10/memo-undermines-russian-lawyers-account-of-trump-tower-meeting
https://www.newyorker.com/magazine/2018/08/20/how-bill-browder-became-russias-most-wanted-man
https://www.google.com/amp/s/amp.economist.com/leaders/2018/12/15/how-the-0001-invest
https://beachgrit.com/2020/06/breaking-dirk-ziff-owner-of-world-surf-league-also-co-owner-of-plantation-that-once-housed-500-slaves-but-is-now-americas-most-expensive-and-snootiest-private-clubs/

Scott Cook:
https://www.propublica.org/article/turbotax-just-tricked-you-into-paying-to-file-your-taxes
https://darkpatterns.org/
Accounting for Rationality: Double-Entry Bookkeeping and the Rhetoric of Economic Rationality: https://www.jstor.org/stable/2781637?seq=1 (if you don’t have JSOTR and want this, I’ll send you a copy)

Billionaires in the News: American Billionaires as a group surpass $1 Trillion in increased wealth during the pandemic. Elon Musk gets COVID, launches manned spacecraft, and makes a fool of himself on Twitter again. Sheldon Solow, New York real estate billionaire and “art collector,” has died.

Billionaire #1: Safra Catz, 9/10 on the DKMALI (19:55)

Safra Catz is the current co-CEO or Oracle. Oracle makes enterprise software and database projects, and was instrumental in building the communication infrastructure necessary for the rise of the US government surveillance apparatuses (I think I said CIA when I meant to say NSA a couple times). She has been helping steer the Oracle project for decades. She loves Trump and thinks he’s smart. She’s good pals with Sheldon Adelson. Much like Adelson, it appears she is an Israeli nationalist. You go, #girlboss!

Billionaire #2: Familia Santo Domingo, 4/10 on the DKMALI (47:20)

The Santo Domingo family’s fortune is rooted in the beer business, although it has become a sprawling cosmopolitan network of investments. This is a different kind of billionaire family than we’re used to. This is the sort of family that seems like it would feel more at home in the 1920s than the 2020s, because everyone is described as a “socialite” and half of them are European royalty. Downright Hapsburgian. Joe tells us a lot about how the beer industry is controlled by a duopoly, and why that’s the reason you can’t get that great microbrew you tried on vacation.

Links:
Solow Foundation: http://www.solowfoundation.org/hours-of-operation/
CIA Project Oracle: https://paleofuture.gizmodo.com/larry-ellisons-oracle-started-as-a-cia-project-1636592238
Larry Ellison, NSA supplier: https://www.theatlantic.com/business/archive/2013/08/guy-who-provides-nsa-databases-loves-nsa-surveillance/312223/
Ellison NYT editorial: https://www.nytimes.com/2002/01/31/opinion/IHT-a-single-national-security-database.html
Catz at Israeli ambassador’s house: https://www.youtube.com/watch?v=6yiMYts63kU
Leigh Stein on #girlbossing: https://gen.medium.com/the-end-of-the-girlboss-is-nigh-4591dec34ed8
Oracle's Social Enabled Policing brochure: http://www.oracle.com/us/industries/public-sector/social-enabled-policing-wp-2541916.pdf
Beer duopoly: https://slate.com/business/2020/07/break-up-big-beer.html