The Rotten, Horrible People of Palm Beach, Florida
The New York Times' David Segal has gone to Palm Beach, the collapsing redoubt of vile and petty aristocrats, and brings an alternatively joyous and revolting tale of corroded souls and disappearing fortunes.
There has been much reportage on Palm Beach lately, both as ground zero of Bernie Madoff's crimes and as a barometer of the recession's impact, such as it is, on ostentatious wealth. But nothing so far has captured so well the mixture of entitlement, defensiveness, and rank opportunism on display among those in the overclass who, having lost fortunes yet remaining wealthy beyond all reason, feel permitted to participate in the national sense of despair over our calamity. Segal describes it as "catastrophic loss in the midst of spectacular plenty," but the loss in question is, in most cases, the diminution of a marginal amount of wealth that afforded its owners not things—they already had enough to buy whatever they wanted—but a sense of self. When he asked a local shop owner why local millionaires have cut back on jewelry purchases even though they could still afford them, he answers that "you'd need a shrink to get to the bottom of it."
Or a burning cop car. It stirs the blood to revolution. Here's an extended passage, from Segal's canvassing of ludicrously high-end retailers along Palm Beach's Worth Avenue (pictured above) to find out how shrinking hedge fund accounts have impacted sales of $6,800 jackets:
At a men's store called Crease Liberty, a longtime customer recently told Jennifer Inga, a saleswoman, that he wouldn't be buying anything for a while, because his net worth had dropped to $12 million from $30 million.
"He said, ‘Now is not the time.' It's mind-boggling to me," Ms. Inga said. "How can someone with $12 million feel like they can't afford a new pair of pants?"
As she was talking, another businessman, Bruce Beal of Boston, came out of a dressing room, barefoot, in a pair of trousers he was trying on. He'd overheard the question and he had a very detailed answer.
He imagined a hypothetical couple, in their 60s, who started last year with $15 million—one-third with Madoff, one-third in the stock market and one-third in bonds. The Madoff millions are gone; the stock market money is down 40 percent. Maybe they've got $350,000 a year in income from bonds and dividends.
They've also got expenses. "Taxes and maintenance on their New York co-op and their Palm Beach house are $150,000 a year. They belong to two country clubs, at $50,000." Plus taxes, living expenses, medical, cars, charitable commitments. And perhaps they have children and grandchildren who depend on them.
"It doesn't take a huge stretch of the imagination to see how these people feel poor," Mr. Beal says. "One feels poor the day you spend a dollar more than your income."
Soon after, a man who Ms. Inga says is a member of the Palm Beach Country Club - where the initiation fee is reportedly $300,000 - entered the store. He looked over the merchandise on sale, then turned to the full-price stuff and asked for a 50 percent discount.
Blood will run in the streets, brothers and sisters. There's much more, including some great anti-semetism and an encounter with Madoff's $2,000 pants. Read it.