Singin' Them Billionaire Blues: Why Are America's Richest Feeling So Threatened?

By all accounts, life for the wealthiest Americans has never been peachier: for the past decade the top tier of earners have accumulated as much as 50 percent of the national economic value created. The unionized workforce is at its lowest level in almost a century and regulation is moribund. Income inequality in the US is higher than it has been since 1928.

Yet some of the richest have taken to making ever more extreme comments about those who criticize the unequal distribution of spoils. Buy-out king Steven Schwartzman compared the threatened repeal of a finance tax loophole to the Nazi invasion of Poland. Home Depot founder Ken Langone attacked Pope Francis for 'failing to understand rich Americans' and, most recently and bizarrely, venture capitalist Tom Perkins, a co-founder of the legendary Kleiner Perkins firm that bears his name compared recent criticism of tech wealth's impact on Bay Area real estate prices to Nazi attacks on Jews.

Where is this paranoia coming from?

Since many of those affected embrace market-oriented symbolism, it may help to think of this in terms of market cycles. Markets go up and down. For a few, especially those fortunate enough to be working in finance and technology, the past couple of decades have been pretty sweet. But mathematics teaches us that things revert to the mean, or whatever goes up, must come down. Meaning the cycle may be about to swing the other way. And those feeling threatened are smart enough and knowledgeable enough to understand that there is an element of luck in the how things have gone for them, chest-thumping encomiums to their own brilliance, dedication and hard work notwithstanding.

So, the re-election of Barack Obama despite almost universal billionaire support for his opponent, the selection of a religious leader unafraid to comment on the economic state of his ministry and the increasingly outspoken protests of those who object to their declining station may well be creating a certain amount of fear among the richest that all of this signifies that a market top - for them - has been reached. That some of the little people have the gall to suggest that the gains of their betters were illegitimate only enhances the sense of violation.

The more extreme the rhetoric, the more likely it may be that this is a market signal to which attention should be paid. JL

Patrick May reports in the San Jose Mercury News:

In a bizarre dispatch from one of Silicon Valley's most fabled and outspoken characters, venture-capital legend Tom Perkins wrote a letter to the editor of The Wall Street Journal comparing recent activism against the Bay Area's tech elite to the early anti-Semitic actions of the Nazis.

In the letter published Saturday in the Journal's weekend edition, Perkins suggests that the "outraged public reaction to the Google (GOOG) buses carrying technology workers from the city to the peninsula high-tech companies which employ them" could be a precursor to the sort of violent attacks the Nazi's waged against Jews on "Kristallnacht'' in November 1938.

The co-founder of Kleiner Perkins Caufield & Byers drew shocked reactions throughout the blogosphere for his sharp attack on what he called the Bay Area's "progressive radicalism."
In the letter, Perkins said:
"Writing from the epicenter of progressive thought, San Francisco, I would call attention to the parallels of fascist Nazi Germany to its war on its 'one percent,' namely its Jews, to the progressive war on the American one percent, namely the 'rich.'"
Kristallnacht, also called the Night of Broken Glass, was a pogrom against Jews throughout Nazi Germany and Nazi-controlled parts of Austria and Czechoslovakia in which paramilitary forces and civilians attacked stores owned by Jews, killed dozens of Jews and rounded up more than 30,000 others.
Perkins went on to trash the Occupy movement, along with the San Francisco Chronicle, which he accused of stoking the "demonization of the rich."
Referring to recent protests in the Bay Area against the Google buses that ferry commuters up and down Highway 101, Perkins said that same anger that some people feel toward Google employees has also carried over to "outrage over the rising real-estate prices which these 'techno geeks' can pay."
Then, in another strange twist, he comes to the defense of his ex-wife, author Danielle Steel, whom he refers to as "our number-one celebrity," who he says has suffered "libelous and cruel attacks in the Chronicle," alleging that "she is a 'snob' despite the millions she has spent on our city's homeless and mentally ill over the past decades."
In closing, Perkins brings up the Nazi metaphor.
"This is a very dangerous drift in our American thinking," he writes. "Kristallnacht was unthinkable in 1930; is its descendent 'progressive' radicalism unthinkable now?"
Reaction against Perkins' letter has been swift and mostly negative, particularly for his suggestion that Nazi fascism and anti-tech protests are somehow synonymous.
Neither Perkins nor representatives with the company he co-founded could be reached for comment. But on Twitter on Saturday, Kleiner Perkins said: "Tom Perkins has not been involved in KPCB in years. We were shocked by his views expressed today in the WSJ and do not agree."
And on The Verge blog, "ruddyD" wrote: "No matter how you feel, Perkins' comparison is way, way, way out of proportion. With comparisons like that you diminish the actual horrors that came with and after the Kristallnacht."