The coronavirus has destroyed the lives, savings and small businesses of innumerable Americans — but the year wasn’t a financial washout for everyone.
The bifurcated economy that took shape in the wake of the Covid-19 pandemic destroyed the lives, savings and small businesses of innumerable Americans, but the year wasn’t a financial washout for everyone.
Between roughly mid-March and Dec. 22, the United States gained 56 new billionaires, according to the Institute for Policy Studies, bringing the total to 659. The wealth held by that small cadre of Americans has jumped by more than $1 trillion in the months since the pandemic began.
According to a December report issued jointly by Americans for Tax Fairness and the Institute for Policy Studies using data compiled by Forbes, America’s billionaires hold roughly $4 trillion in wealth — a figure roughly double what the 165 million poorest Americans are collectively worth. The 10 richest billionaires have a combined net worth of more than $1 trillion.
America’s 659 billionaires hold roughly $4 trillion in wealth — roughly double what the 165 million poorest Americans are collectively worth.
It’s a stunning snapshot of how the pandemic has distorted large sections of the real economy and exacerbated the nation’s stubbornly persistent economic inequality — one that persisted, largely along racial and ethnic lines — even in a pre-pandemic economy with unemployment at a half-century low.
This roundup of the stratospherically rich includes familiar names like Jeff Bezos, Elon Musk and Bill Gates, and emergent billionaires include Kanye West and Tyler Perry.
Most of the new entrants to the billionaires’ list aren’t household names, and for many, the stock market gets much of the credit for their burgeoning net worth. MacKenzie Scott, whose 2019 divorce from Bezos netted her a spot on the list under her own name for the first time, is one example of how the market has made the rich even richer. At the time of her divorce, Scott’s share of Amazon stock was worth around $38 billion. Now, less than a year and a half later, her net worth is estimated by Forbes to be nearly $59 billion. (Scott has made headlines in the ensuing months for her commitment to philanthropy and generous, no-strings-attached donations to nonprofit organizations and educational institutions.)
“Billionaires who started these companies and had a huge stake in these companies did really well this year,” said Frank Clemente, executive director of Americans for Tax Fairness.
A key driver of billionaire wealth concentration was the unprecedented monetary policy response to stabilize financial markets in the early days of the pandemic, which spurred the stock market’s gravity-defying rise. When Wall Street was on the verge of panic in March, the Federal Reserve intervened with the promise of low rates and an open-ended liquidity spigot.
“That gave market participants the assurance that the market volatility would be met with an enormous amount of force, and liquidity can be the salve for most economic wounds,” said Keith Buchanan, portfolio manager at Globalt Investments.
The combination of easy money and an abrupt shift in economic activity that favored digital commerce, communication, education and business activity gave technology firms — both startups and big companies — an unexpected tailwind.