CURIOUS SORT OF STAGNATION (via Robert Schwartz):

Don't Blink. You'll Miss the 258th-Richest American (NINA MUNK, September 25, 2005, NY Times)

THE latest Forbes 400 list of the richest people in America has just hit the newsstands. The idea for the Forbes 400 - rather than, say, 300 or 500 - was inspired by Mrs. Astor's 400, the definitive list of New York high society in the 1890's. It's rumored that Mrs. William Backhouse Astor Jr. limited her social list to 400 because only 400 people could fit into her ballroom, but that may not be true. In any case, they had to be the right 400 people. As her escort, Ward McAlister, explained to reporters in 1888: "If you go outside that number, you strike people who are either not at ease in a ballroom or else make others not at ease."

The first edition of the Forbes 400, dated Sept. 13, 1982, included mainline families like the Rockefellers, the Mellons and the du Ponts. But they found themselves together with self-made men, some of whom were not terribly at ease in a ballroom: William R. Hewlett, who had started Hewlett-Packard in a one-car garage with his classmate David Packard and was then worth $1.3 billion; Robert C. Guccione, the founder of Penthouse magazine, then worth $400 million; Saul P. Steinberg, a corporate raider who had accumulated a $260 million fortune; An Wang, originally of Shanghai, who had started Wang Labs with $15,000 in 1951 and was worth around $400 million in 1982; Meyer Lansky, a mobster whose estimated net worth that year was $200 million; and Laurence A. Tisch, who built a fortune then valued at $600 million by assembling a huge conglomerate, the Loews Corporation. (Note: all net worth figures are in 2005 dollars.) All you needed to join the Forbes 400 list was money.

Right from the start, the Forbes 400 reflected an American ideal: we were a nation of smart, hardworking, resourceful, determined, innovative, daring self-starters. Above all, the Forbes 400 suggested mobility and unlimited opportunity. Every year, more of the old names fell off the list, only to be replaced by names you'd never heard of - names of people who had been inspired to build something from nothing. Inherited wealth, which once dominated the Forbes 400, has over the years come to account for less than 40 percent of the list. The number of Ivy League graduates has dropped, too. And New York City is no longer the epicenter of American wealth.

A few days ago, I read through the newest Forbes 400 list of the richest people in America, hoping to find many names I'd never heard of. They're not there. Through no fault of its own, the list no longer reflects a dynamic and elastic economy; instead, it reflects a growing concentration of wealth and economic power. Warren E. Buffett, Paul G. Allen, Kirk Kerkorian, John W. Kluge, Carl C. Icahn, Michael R. Bloomberg, Ronald O. Perelman, Leona Helmsley, Henry R. Kravis, the Waltons, the Pritzkers, the Newhouses, the Lauders - the same old names, one after another.

It's hard to say when the Forbes 400 list started to stagnate, but 1999 may have been a turning point.

As Mr. Schwartz points out, the chart that accompanies the story put paid to its argument:

Posted by Orrin Judd at September 26, 2005 9:22 AM