Jan 16

Who are the 1%? Finance, Function and Family

By Joost van Steenis

The elite is a more or less closed group that possesses more power and money than anyone else. We can determine who belong to the top of the 1% with the factors Finance, Function and Family.  The Theory of the three F’s.
Finance. He (occasionally a female) has vast amounts of capital at his disposal to use in the economy.
Function. He has a prominent position in which he can contribute to the decision-making process.
Family. He has a network of trusted Family Members with comparable positions. By confidential contact with family-members he gets special information nobody else possesses.

Bush, Kennedy, Roosevelt or Rockefeller belong to the 1% while Eisenhower, Clinton or Obama are less important. Pressure on these stooges is hardly effective.
Gates has no high-placed family-members but is important because of his huge private financial possibilities.
Former minister of defence Colin Powell had a high position but no Finance nor Family. He did not have much influence on American policy.

The 1% uses the elitist democracy to warn newcomers to stay in line. Martha Stewart, investment banker Quattrone, QWest CEO Joseph Nacchio and Adelphia Communications founder John Rigas have been put under pressure by the judicial system.
Bernard Ebbers, founder of Worldcom, started as milkman. Before the concern crumbled away when the telecom-bubble busted he was regarded as a savvy entrepreneur, cementing his reputation in 1988 with the $40 billion purchase of MCI, at that time the largest acquisition in corporate history. The 63-years-old was sentenced to 25 years in prison and had to surrender most of his personal assets. It seems a light sentence in view of the 20,000 workers who lost their jobs and the many shareholders that lost about $180bn when the company filed for bankruptcy protection. Ebbers advanced to the top without the backing of a powerful Family and he did not abide by the unwritten laws of the 1%. He was punished as a warning to other upstarts.



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