The rich and powerful become more rich and powerful every day. With such a massive bull market since 2009, the wealth gap has widened immensely.
My friend invited me to a party to support our city's mayor, Ed Lee, may he rest in peace. The cost was $500 per person, which is the limit for political contributions per person, per event.
Usually, I would just pass because of my disdain for politicians in general. However, Ed Lee was the incumbent, and was willing to provide tax breaks for firms like Twitter and Zynga to stay in San Francisco, and therefore keep jobs in San Francisco.
I deliberated for a while and decided, what the hell. My friend was college classmates with the host, who so happened to be named Marissa Mayer, 37, the first female engineer at Google, and now the CEO of Yahoo. This was back in 2012.
The Rich And Powerful People
Marissa hosted the party at one of her penthouses somewhere in San Francisco which I shall not disclose for privacy purposes. She and her husband were gracious hosts to us all. At the party, there were only a total of around 70 people, 70 very influential people.
Ron Conway, the founding father of Angel Investing rolled in with his dark-rimmed classes and silver hair. Former SF Mayor Willie Brown was there in his suit and hat. Rose Pak, “The real Mayor of San Francisco” hobbled in due to a sprained ankle. Mark Pincus, founder of Zynga, who really is only about 5 feet 6 inches tall, came in a black turtle neck.
And of course, MC Hammer, 1990's super start rapper and now VC investor joined the party as well.
Funny enough, the people I talked to the most were Hammer for an hour and Rose Pak for about 45 minutes straight. It was fun to hear Hammer talk about his projects, what his son “Booby” is doing, and how he went back to Japan during the earthquake tsunami tragedy to help out.
He felt a kinship with the Japanese people after having performed at Tokyo Dome five times in his career. We talked about collaborating on charitable events in the Bay Area as well. At the end of the night, we traded text messages and promised to keep in touch.
Power Of Rose Pak
Rose Pak was just as interesting given she was the main reason why Mayor Ed Lee ran for Mayor and got re-elected. She controls the Chinatown vote, which is one of the most important groups of people in San Francisco given the size of the Chinese population.
Rose provided an inside glimpse into the other candidates and how respect for the community and for one's elders was tantamount. About every 5-10 minutes, a couple younger fellas would come by and ask if Rose was alright and whether she needed any food or drinks. Aunty Rose was the god mother and more important than anybody else in the room.
Unfortunately, Rose Pak also passed away on September 18, 2016, four years after this party. Hence, please enjoy every day of your life as I now realize both Ed Lee and Rose Pak both died unexpectedly.
Access And Networking Is The Key To Success
As I observed the crowd of 70 mingle and exchange stories, I came to the realization that once you are rich and powerful, it's easier to get that much richer, and that much more powerful.
If you have a promising start-up but face tremendous competition, you likely won't have a chance to stand out. But, if you have Ron Conway on speed dial, you are golden because everybody's ears will perk up and pay attention.
When you've got money, you can afford to buy access. It sounds contrite, but that's what rich people do. They are able to participate in fund raisers and charity events to get to know other rich and perhaps famous people who can also afford to attend.
Even though I am financially independent now, $500 is not chump change to me. It's how much I gave to the Yakezie Writing Contest and it does affect my budget.
Sometimes the price of admissions is $1,000, or even $38,000 for the party Robert Mailer Anderson hosted for President Obama this past February.
The party was exclusive and to everybody there except for me, $500 was an afterthought. I just so happened to be a friend of a friend. If I wanted to join Yahoo now, getting at least an interview might have gotten a little easier.
Ah, to be rich and powerful!
The Playing Field Will Never Be Level
The reason why those with money and power have the responsibility to do good is because the playing field is not level. If you so happen to be born to a poor single mother who works two jobs to feed you and your brother, it is hard to compete against someone who grows up in a wealthy household. From tutoring needs, to private school, to having parents as alumni of prestigious universities or who are in senior roles at companies, wealth makes a difference in getting ahead.
Some of us are simply just luckier than others. If so, then it is up to us who are the most lucky to help those less fortunate. Since July 2009, I've been motivated to help people achieve financial freedom sooner through Financial Samurai, where everything will always be free. The better grasp you have on your finances, the more confident you'll be.
America is the best country where there is the highest correlation with effort and success. I am very thankful for the public school education I received, and the ability to invest my money and work towards entrepreneurship. However, getting rewarded solely based on merit is impossible given we all have biases.
Can the government bureacracy improve for small businesses? Absolutely! But the point is, there are many qualified individuals who are also smart and hard working, but dont't succeed.
A lot of success has to do with luck. Plenty of success also depends on who you know. For those who are connected and who have luck, don't forget those who helped bring you there.
The Rich And Powerful Will Always Have More
Money buys power. And once you're powerful, you'll gain even more money if that is what you wish. My fellow partiers weren't there for either really. We were just there to help keep an incumbent Mayor in office and help keep jobs in San Francisco.
But if you listen carefully, you'll notice the discussions revolve around the charities we support. There weren't really conversations about business. Dialogues were all about trying to figure out ways to give back to others.
Pity the person who did not have any cause they cared deeply about in which they could speak its merits. That is when you become an outsider because nobody cares how much money you have or who you know at such events.
The net worth in Marissa's apartment that night was probably close to $4 billion dollars. With this much money comes a tremendous responsibility to help others and that's exactly what so many of the attendees are doing.
Primary Photo: Hammer came up to Mark and said, “I'm a big fan! Can we get a picture together?” Hammer handed over his black iPhone and asked me to take a shot. I did, but my finger was in the way, and the flash whited out their faces, so I asked them to pose and took another.
Related: Invest Like The Richest Members Of Congress For Big Gains
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[…] are not only smart, but who are well connected. The system is institutionalized to take care of people who are rich and powerful. Everybody else has to compete only on merit, and merit doesn’t really matter when you can’t […]
[…] How The Rich And Powerful Become More Rich And Powerful […]
What I don’t get about all is…why feel guilty for having money? Its not dirty or immoral to be rich. There seems to be this idea floating around society these days that having money is something to be ashamed of. Its not, there is no reason to be ashamed of your success.
It’s hard to explain, but you’ll know more about the guilty feeling once you get to $3+ million I think. You’ll start asking yourself how could you have so much when so many others have so little.
And this post isn’t about the guilt. It’s about going defensive and blending in because you want to avoid the attacks.
Thank you for this. For me the most important thing you shared was about foundations and causes. Thank you for making that connection.
Overall, well said.
Interesting… Your post reminded me of that Clint Eastwood movie, “In The Line of Fire”. John Malkovich’s assassin character bought himself access to a presidential fundraiser with a couple of multiple-zeros checks to the National Party Committee (I forget whether it was D or R — doesn’t matter). Enough money, judiciously donated, buys all kinds of opportunities.
Nice party! It’s always great to hear stories about celebs who aren’t always marketing themselves are have a “I own the world” attitude. Usually those are the ones who get all the press, and it’s ridiculous. I love giving, and it’s even cooler that these folks can give on such a HUGE level. I’ve always said, if I come into money, I won’t retire, I’ll just hire myself as a full-time philanthropist! And I’m sure Hammer will text you back, why not? Seems like a legit guy.
Great article Sam.
We’ve been texting back a storm :)
Congrats on your success.
I wonder if the guilt they may feel is the result of the intuitive calculation that many people on many levels sacrificed to enable their road to success? One thing I am trying to wrap my meager neurons around right now is how the system subsidizes the wealthy by basically allowing them to write off their bad investing bets. If you made money on a particular investment transaction, good for you. Pay taxes on it. If you lose money on an investment transaction, should you really expect the government to bail you out and allow you to write it off against income you earned that year? How much revenue is lost each year because the IRS allows people to write off their bad debts?
You’ve always been very helpful Forest! I appreciate it. You and others who don’t live in the US must find us a very contentious bunch between the left and the right yeah?
Wow, sounds like you had a great night. I hope Marissa is successful too. I have always liked Yahoo! and it’s too bad they have been on the slide lately. One of my friend works there and he likes it.
I don’t think rich people should feel guilty at all. I assume they worked hard to get there or at least worked to maintain their wealth. Hopefully they’ll manage to give others a hand, but that’s their prerogative.
Yeah, it was fun hanging out with everyone. The only difference between them and most people is that they have more money. Everybody’s basic human spirit is the same.
I read the Obama comments as saying that successful business owners had help along the way, whether it was employees that took a chance, family that supported them, new customers that took a leap of faith…I think what he said was probably worded poorly but also got taken out of context.
It is pretty impressive how those who are vehemently against Obama have taken the quote way out of context. Spin, baby, spin! Which is why I hate politics in general.
It took me a while to really believe, but outside of routinely collecting a paycheck (although office politics are tough to ignore), networking is how you make things happen. You can be the smartest guy around, have the best ideas or have a lot of money to put to work, but if you don’t connect with the right people, your chances of making something big happen are quite limited.
Exactly. Nobody really cares about what you do or how great you are, unless they know you.
Yes, I’ve got several pictures. It was all casual and fun. It wasn’t like a fan to celebrity type atmosphere at all. You can see Marissa in the third picture standing in the background if you look closely.
Powerful people are not always affluent. The power you describe is wholly materialistic – the kind that’s not humble or enlightening. Politicians are responsible for turning the world into a powerful mess! I wouldn’t call these people powerful as I am so often disturbed about what lies beneath the numbers! Powerful people do not enjoy parading themselves, they are quiet leaders and work on enhancing their intellectual property portfolio over bricks and mortar.
How is being the CEO of 14,000 people at Yahoo materialistic? How is being the Mayor of SF materialistic? These folks in my post aren’t parading themselves to the public at all.
Help me understand your anger and what is bothering you in your personal situation?
“If you’ve got a business – you didn’t build that. Somebody else made that happen.”
I think it was much more than a political gaffe. I honestly believe it’s how the President thinks about business owners. He regards them as over-priviliged and under-taxed. Most likely, because he has never run a small busines. Sure, they have a huge advantage of environment and infrastructure here in the U.S. But, they have paid for much of that with their taxes.
This comment has been blown way out of proportion and used by the Romney campaign for political posturing. But, it certainly hasn’t endeared the President to small business owners, many of whom are struggling. It also isn’t likely to help small businesses create jobs and reduce unemployment, knowing he wants to raise their taxes.
The red tape small business owners have to go through, and the amount of forms and taxes here in California is SHOCKING! Makes many small business owners want to just give up. Hopefully our mayor is doing some streamling for us. $850 in an annual franchise board tax for example is taking advantage of small business owners, for example.
If you and SBOs hate taxes, why don’t all Americans vote against politicians who raise taxes? Or, do we only complain when we are affected, and don’t care about other’s people’s taxes getting raised if ours isn’t?
@Bret: Whether you like Obama or not, it is silly to deliberately take him out of context. Romney should criticize him for real things, not fake things. Obama said “Somebody invested in roads and bridges. If you’ve got a business, you didn’t build that. ” THAT obviously referred to the roads and bridges (i.e. infrastructure)
For Romney to come back with “To say what he said is to say that Steve Jobs didn’t build Apple Computer…” makes him a liar and untrustworthy.
Janna,
Whether you like Mitt Romney or not, calling him a liar seems silly. I’m not a big Romney fan myself, but I think you could make your point without sinking down to name calling.
I didn’t vote for President Obama and I don’t agree with many of the things he does. I have both praised him and taken him to task on my blog a couple of times. One thing I have always been is respectful of any standing President, whether I agree with them or not. Another thing I don’t do is take someone out of context. We are all aware of the entire conversation, which I addressed in my comment. As I stated above, I honestly believe the President feels that way about small businesses, or I wouldn’t have said it.
Two of my brothers have small businesses in our town and they have a fair amount of employees. Both are very concerned about the future, which has put a damper on hiring. They are the most concerned about their healthcare costs rising drastically. This is one reason why unemployment remains so high. Business owners are afraid to hire in this climate. They definitely pay their fair share of taxes, which helps pay for the roads and bridges they use. They both believe less government is preferable to higher taxes. I tend to agree with them.
I agree with you that we need to give small business owners who are creating jobs a big break. I think we should be doing that and not giving tax breaks to businesses who are sending jobs out of this country. I’m sorry if you were offended by my calling Romney a liar. When I saw that quote of context yet again I had to say something. I’m sure there are many who still haven’t heard or understood the entire context.
Janna,
I was not offended whatsoever by your Romney comment.
I am not thrilled with either cadidate and wish we had better choices.
Thanks for the lively debate and for respecting my views and opinions.
Bret
Sounds like you’ve mapped out your safety net in case if you get bored with the sabbatical, Sam! Yaaahooo! That’ s the best $500 investment you can make for sure. :)
Guess so! Love Yaho!
That must have been one incredible night! I think it’s very exciting to see what’s going happen with Mayer’s new venture while also being a first time mom. If she pulls this off it’s going to inspire women everywhere. I’m actually already inspired even though she hasn’t been there long enough to really make any big changes yet.
I think networking is much more powerful for the rich because they tend to be surrounded by highly successful people whether it’s their colleagues, neighbors, family, or friends. It isn’t to say they only hang out with rich folks though, they just tend to be in circles with other rich and powerful people.
On a side note I do wonder if the Chinatown rail station they’re building in SF wouldn’t have been started if Lee wasn’t in office. It’s insane how much they are tearing up the downtown streets in order to make the build out. Good for construction jobs though, and freeing up the bus madness in Chinatown.
The odds are against her since she is the 7th CEO in several years I believe, but I’m rooting for her. Her success will be good for:
* Women
* People who might be discriminated against due to their youth.
* Fans of education.
* Fans of loyalty.
It’s obviously easier to care for a family when you can afford help. I’m sure others will attack this angle. But, overall, her success brings much more success than criticism.
What an awesome event! I do believe money buys access. It is interesting how indirect some of the benefits networking can be. Sometimes just being a part of certain circles means that you hear something years before it becomes common knowledge. I am not even talking about anything unethical, just industry-specific. I hope MC will text you back.
Good luck to Marissa. She caused quite an uproar this week by suggesting that she will not miss much time from the “struggling” Yahoo due to her pregnancy/upcoming baby.
I wish her luck too. And I applaud her for being driven and hiring help. Women shouldn’t feel they have to drop everything just because they are giving birth and that’s what society “expects” them to do. There are more and more dads becoming stay at home parents and there are tons of full time working moms out there. She and her husband will find ways to make things work and I think she’s exactly the type of person who has the momentum and motivation to hit the ground running at Yahoo and in her personal life as a new mom.
Sounds like it was a very cool event! Very true about the playing field — not everyone’s had the same start or access the opportunities.
Thanks for the insight! I will probably never participate in these kind of fundraising events. The phoniness of politics bothers me too much, although your experience sound worthwhile. Do we judge people based on the quality and value of their network? Absolutely! The hostility with the rich is based in envy and jealousy. The rich do not think much about what other people think very often. I think most rich people do not seek publicity or want to be the center of attention. No matter what we do or want to do to make things more level, it cannot be done. The rich and powerful have something we wish we had, access to other rich and powerful people. It is like having the keys to the kingdom!
There definitely is easy access to “the kingdom” if you are rich and powerful. There’s no way our mayor will ignore Marissa’s call for example, even though he governs over almost a million people. And why should he? We don’t ignore our friends.
Very true! If I were the Mayor, I think it would be very tricky because you need the fundraising,b ut you do not want to be bought. I wonder what it will be like the next time she calls and it goes against his principles or values. Do you stay true or sell out!
My brother loves MC Hammer. He actually saw him perform at a Six Flags about a year ago.
I think there are some people who feel lucky to have gotten to be rich and some people who think they’ve sweat for every penny. Some of the folks who attribute their wealth only to their hard work can be a little frustrating. They sometimes think that they have worked hard to get where they are and everybody else should do the same. I don’t think everyone who is rich has that attitude but there are some.
Yes, there are some, and it’s too bad. There will always be some.
Interesting article and as usual it included many thought provoking questions.
“What he means to emphasize is, “If you were successful, somebody along the line gave you some help.” It’s not that you didn’t work hard and take risks. It’s just that ff you live in America, you have the infrastructure to help make your dream a reality. America is the best country where there is the highest correlation with effort and success. I am very thankful for the public school education I received, and the ability to invest my money and work towards entrepreneurship.”
I totall agree with this!!!!!
Hear, hear!
This is quite a cool experience if you ask me. You got to meet some really neat people.
I think networking and exposure go a long way so for Marisa this could be a real help.
I agree with Lance too. You need to earn being rich. Make a contribution first and then get rewarded. It’s the only fair thing.
The cool thing is, Marissa isn’t making any money out of the event. She just provided the avenue and the ability for others, and her friends to contribute and help a cause. The money goes directly to Ed Lee’s campaign, and he won.
Helping support someone’s beliefs goes a lot farther sometimes than directly supporting that person.
He may have, but he is well connected, and I’m sure he’s doing very well now.
I’m happy to be an Angel investor in anything I think is a good idea that could work. I allocate about 10% of my Net Worth to higher risk investments. I’ve currently got one that has been alive for the past 6 years. Let’s see what happens!
Congrats Sam- you are a bona fide celeb now…
-Mike
Au contraire. I am nobody.
This reminds me of when I heard Bill Gates speak about that meeting with Warren Buffet, Oprah, Richard Branson, and about a dozen other billionaires.
News outlets were speculating on the front page, what they were talking about. But Mr. Gates simply said they were discussing ways to help the world, and looking for more people that wanted to help also.
Ah, very interesting! Sounds exactly like what this party was about. Michael Kirsch, who sold Bebo for $700 mil was there talking about Charity Water as well. He’s donated some $3 million+ to the cause and won’t stop.
MY challenge, when coming to charity, has been that I feel I need to “establish” myself in the world before I can effectively give back to it.
I mean, I actively look for ways to give back to people, usually through either listening to them (what they’ve wanted to say sometimes for years), and/or educating them (such as through personal finance). But, the limitation of this is it’s very one-on-one. I haven’t been able to mass produce “being of service,” and am looking for ways to actually do this, and figure it will be much easier once I have an 11-figure net worth.