Do You Hate the Rich?

A few weeks ago, before the Winograd inquiry published its findings, one of the papers wrote a flattering article about Dan Halutz, who resigned as commander of the army before he could be forced out, and who heard of the committee's damning conclusions from a distance of 8,818 km, as the bird flies.

Halutz, the paper wrote, went to study at Harvard, but before leaving, he had a chance to examine possibilities for his post-army career. Among other things he met with four leading business figures, just to get an impression, nothing binding.

The pictures of the four appeared at the bottom of the page: Nochi Dankner, Idan Ofer, Yitzhak Tshuva and Zadik Bino.

Trivial, really. That was a pretty obvious list: they're among the richest and most influential men in the land. 

But sometimes the trivial needs to stand up and shout to make you understand what it really means.

In Israel model 2007, a top official, a leader, in this case  of the army, steps down from his public position, and what is the first thing he does? Checks off his list of billionaires. He starts with Dankner, passes through Bino, goes to Ofer and meets with Tshuva for dessert. If you're really assiduous you drop by Dudi Wiessman and Lev Leviev too. No luck? Onto the next six richest men.

It is only natural, what Halutz did. The four tycoons with whom he met, and two or three more, possess fantastic economic power.

It is not their personal financial might that makes them so monumental: no, it's their control, direct and indirect, over hundreds upon hundreds of companies.

Pure hypocrisy and shortcuts to power

For Halutz or any other retiring public figure, these four or six business leaders sit on the most precious resource there is: jobs.

The media sputters about jobs for the boys, mainly in Likud circles. But that's pure hypocrisy. The entire Israeli marketplace, including the ostensibly advanced ones, are based on social networks that hand out the jobs. The Likud Central Committee just has worse PR.

What jobs? Jobs that assure these former officials of a life in clover, and the power to which they have become accustomed, and are loathe to lose.

It is natural for the business barons to control this resource. They lead gigantic concerns that have hundreds upon hundreds of managers, directors and chairmen on the payroll.

Natural, but scary too. No matter how high, every bureaucrat, every minister, every policy-maker knows that one day, one night, he'll run into the Six. As a hiree, an adviser, or supplier to one of their companies.

The implications for Israel, for the concentration of power, for the independence of the policy-makers is clear. A handful of men can direct the direction of the entire economy. Of the country. Not only in business, either: it's no coincidence that they have dozens of hundreds of former politicians, judges, policemen, generals, regulators and government figures on their payrolls.

These tycoons aren't just buying management skills. They are buying short-cuts to power. To the ministries, police, army, health officials, enforcement, regulation and government.

Who'se our water guy?

Ran into a regulatory obstacle? Tap your guy who stepped down from the relevant authority the year before. The ruling will be professional, of course.

Need somebody to set up the kid in the right unit in the army? Got the very guy. A phone call to the right place and the placement officer will understand that there had been a misunderstanding and that it's in the general good that the kid go to the right place, for professional reasons ocourse.

Had a little run-in with the local authorities. Dear dear, thatcanbefixed. And health comes first: we'll get you the head of department in hospital, personally. He's on the boards of some of our companies, we donated a whole department for him and he's an ace consultant  to biotechnology startups.

Last week TheMarker Magazine published its list of the 500 richest people, for the fifth year.

In the last year, the top 500 increased their combined wealth by nearly 25% to $81 billion.

When we began publishing the list, the entry point was $20 million. Now it's $50 million to get through the door.

And the rich grow richer

The leap was the result of international processes -  globalization, investments by Israel's tycoons outside the country, the tremendous leverage available to them in other places, global growth driven by India and China.

But your average reader doesn't care about nuances. The Top 500 usually inspires one of two reactions: "I love the rich" and "I hate the rich".

In reality, the rich is not a homogenous group. There are all sorts. Some made their money from industry, hi-tech, business initiatives. Some inherited it, some finagled a government tender or indulged in something smelly with government, some fought like tigers in the free market, some made it through a combination of leadership, wisdom, and originality.

Some broke into new markets, and are models for emulation as they forge on creating jobs, and some are experts mainly at transferring public assets to their private pockets.

Some see that they have to give back a lot of their money, before they die; and some view their fortunes mainly as a lever to make even more money.

Some believe they should serve as role models and adopt the highest ethics. Some bribe politicians, threaten regulators and trample every public interest in the name of their own aggrandizement.

Being rich in and of itself tells us nothing. Some of the rich are decent men. Some are not.

Great wealth and power should engender a deep sense of responsibility. Not only to the companies and clients and shareholders, but to the public that put you there as well.