Part 1

All the Money in the World: How the Forbes 400 Make - and Spend - Their Fortunes
by Peter W. Bernstein, Annalyn Swan

Published to coincide with the twenty-fifth anniversary of the Forbes 400, All the Money in the World, the work of a team of prominent editors and business writers, goes behind the celebrated list to paint a vivid and revealing portrait of the wealthiest Americans of the past quarter century. Abundantly anecdotal, with insights gleaned from original research, interviews with Forbes 400 members, and never-before-compiled data, it is filled with illuminating "infographics" - tables, sidebars, factoids. The book shows how the superrich succeed, how fortunes are made in various industries, and how, once made, they are saved, enhanced, and sometimes squandered.

From Wall Street to the West Coast, from blue-collar billionaires to blue-blood fortunes, from the Google guys to hedge fund honchos, All the Money in the World gives us the lowdown on, among other things: the all-time richest Americans, who made and lost the most money in the past twenty-five years, the fields and industries that have produced the greatest wealth, the biggest risk takers, the most competitive players, the most wasteful family feuds, the trophy wives, the most conspicuous consumers, the biggest art collectors, the most and least generous philanthropists.

Produced in collaboration with Forbes magazine, All the Money in the World is a vastly entertaining, behind-the-scenes look at today's Big Rich, a subject of enduring fascination to all Americans.

The Forbes 400 is the dominant symbol of wealth in America. It recalls the earlier 400 list of Mrs. Astor but differs from hers in one telling respect. Whereas the original 400 referred to the collection of socially prominent New York families who filled the ballroom of Mrs. Astor in the late nineteenth century, the Forbes index spotlights individual wealth. It measures the size of this or that personal fortune. It asks not where you came from or who you work for, but who's richer? It's the big-banana index - simple, primal, direct - and for those reasons irresistible.

Malcolm Forbes, a passionate believer in fortune-making, established the list in 1982. There was nothing elitist in his ebullient approach to wealth. Forbes was unashamed by his fortune; he relished the idiosyncratic (and he knew the value of publicity in promoting his brand). His favorite form of transportation was neither the everyman's Chevy nor the aristocrat's polo pony, but a motorcycle and a hot-air balloon - both of which kept him and his eponymous magazine, Forbes, in the news. Several years before the creation of the 400 list, Forbes developed a Cost of Living Extremely Well Index (CLEWI), a cheeky riff on a traditional Cost of Living Index, which measures the price of staples. The CLEWI charted the changing prices of yachts, caviar, cigars, and private planes. Similarly, Forbes presented its 400 as celebrities, treating them the way People treated actors or Sports Illustrated home-run hitters. The reported numbers had a kind of celebrity flash: A fortune was a batting average.

It seems remarkable that the Forbes 400 list, today endlessly quoted around the world, is only twenty-five years old. (B.C. Forbes, Malcolm's father and the magazine's founder, published a brief precursor of the list in 1918, naming the thirty richest Americans of the time, but it did not take hold.) The Forbes 400 is a particular product of its era, a living reflection of recent history. It captures a period of extraordinary individual and entrepreneurial energy, a time unlike the extended postwar years, from 1945 to 1982, when American society emphasized the power of corporations. The gross domestic product (GDP) in the United States has more than doubled since 1982, and may soon triple. The size of American personal fortunes has more than kept pace.

In 1982 only thirteen billionaires were on the Forbes list, and you needed $75 million to make the cut. Today you must be a billionaire. In 1982 the combined net worth of the 400 represented 2.8 percent of the GDP. By 2006 that figure had risen to 9.5 percent. (The percentage actually reached 12.2 percent of the GDP in 2000, during the Internet boom.) More generally, in 2005 the wealthiest 1 percent of Americans claimed a percentage of the national income not equaled since 1928. Only the Gilded Age, the period from the Civil War to the 1890s, and the 1920s can withstand comparison to the last twenty-five years in terms of wealth accumulation.

For many people (not least, before his death, Malcolm Forbes himself) the Forbes 400 represents a powerful argument - and sometimes a dream - about the social value of wealth in contemporary America. In this view, great wealth does not (at least in the United States) suggest an aristocratic or privileged group of people who inherited their positions. It means enterprising individuals, a marvelous meritocracy of money. Those who make fortunes are an ever-changing, ever-churning group of remarkable people who flourish in the land of opportunity. They bring jobs, energy, ideas, and even joy to their society. They have been responsible, in the late twentieth century, for extraordinary advances in technology, the invention of new financial instruments, and the efficient restructuring of American industry. Money is fluid. Money is restless. In 1982 twenty-four Du Pont heirs were among the four hundred wealthiest Americans. By 1999 no Du Ponts remained on the list. New money was supplanting old. It was wealth's way.

To be sure, many take the other side of the argument. Why commemorate greed, competition, and dollar one-upmanship? What does it say about America that the wealth of four hundred individuals should, in 2006, equal almost one-tenth of the annual output of a nation of 300 million people? To skeptics, the Forbes 400 symbolizes a period of avarice, excess, and selfishness.

All the Money in the World does not join in these arguments. Instead it recounts a more nuanced and personal story. At times anecdotal, at times analytical, All the Money in the World tells the story of the individuals who actually made the money, many of whom were interviewed for the book. Taken together, their stories illuminate how fortunes are made, lost, and spent today. The book is organized into three sections.

Copyright © 2007 by Peter W. Bernstein.

About the Author

Peter W. Bernstein and Annalyn Swan are veteran journalists and editors who between them have worked at U.S. News & World Report, Time, Newsweek, and Fortune magazines over the last twenty-five years. Bernstein is the coeditor of The New York Times Practical Guide to Practically Everything and editor of The Ernst & Young Tax Guide. Swan is coauthor, with Mark Stevens, of de Kooning: An American Master, which was chosen as one of the ten best books of 2005 by The New York Times Book Review, and which won a Pulitzer Prize and a National Book Critics Circle Award. Bernstein and Swan are cofounders of ASAP Media, which helped produce Secrets of the Code: The Unauthorized Guide to the Mysteries Behind the Da Vinci Code. They live in New York City.