Wealth-Creation In A Pandemic
Forbes India|May 07, 2021
Covid-19 brought terrible suffering, economic pain, geopolitical tension—and the greatest acceleration of wealth in human history. Why this pandemic paradox could become a cause for celebration, not concern
Randall Lane

On March 18, 2020, the United States registered its 150th coronavirus-related death while trying to gauge, along with most of the world, just what was happening. Major market indices fell 5 percent after jumping 6 percent the previous day. Spring breakers partied blithely in Florida while officials decided to close the border with Canada. And a statistical team at Forbes locked the numbers for our 34th annual ranking of the world’s billionaires, unwittingly creating a snapshot of global wealth at the precise moment the world lurched into its most disruptive 12 months since World War II.

Over the ensuing year, those 150 US deaths swelled to 550,000; some 3 million souls were lost worldwide. Tens of millions of jobs evaporated, along with hundreds of thousands of small businesses. Remote work went from exotic to standard. The suburbs went from dull to desired. The death of George Floyd triggered a reckoning concerning race and social justice. The presidential election tested democratic norms. Simultaneously, though, many individuals, industries, and investments thrived.

One year after that fortuitously timed snapshot, we repeated our March billionaires audit, taking the measure, at the point of the pyramid, of the past year’s seismic changes. The results defy hyperbole. Over the past 12 months, 493 people worldwide joined the Forbes list—a newly minted billionaire every 17 hours. Rising asset prices vaulted another 250 previous drop-offs back over the ten-digit mark. Amid widespread economic insecurity, precious few billionaires fared worse financially: Just 61 dropped off the list for reasons other than death, representing the lowest percentage of drop-offs for any year on record. All told Forbes estimates that there are now 2,755 billionaires globally, up from 2,095 last year, and the notion that the rich get richer has never been more apt: They’re worth, in aggregate, $13.1 trillion—a staggering $5.1 trillion more than at the start of the pandemic.

These figures will engender endless amounts of consternation, most of it justified. There’s no getting around a collective $5 trillion wealth surge during a pandemic, when most of the world felt scared, sick, besieged. Capi tales, the greatest system ever for generating prosperity, rests upon a social compact of expansion, unequal by design, ultimately lifting all boats. The Covid-19 economy has strained that concept; yawning economic disparity poses arguably the greatest threat to modern social order.

But as miraculous vaccines chart a course back to normalcy, the factors driving these numbers conjure a different emotion: Optimism. The pandemic’s most enduring positive legacy will turn out to be an accelerant, compressing decades of change into one year. And the newly super-rich, proxies for the opportunity, or lack thereof, have never felt more different, looked more different, or acted more different. It’s worth spending some time to deduce why.

We’re at that rarest of inflection points—the kind that’s apparent even as it happens. Vaccines will wash across the planet at the same time the global economy seems primed to roar back. And while the initial reaction to the billionaire surge of 2021, a newcomer tally 70 percent larger than any we’ve logged before, will lean toward outrage, the underlying trends offer a road map to greater prosperity for all. Like anything else salvaged from a once-a-century plague, we just need to be brave enough to harness it.

For pretty much all of human history, wealth has been dynastic. The John D. Rockefellers and Henry Fords of a century ago launched the first era of entrepreneurship, but even those successes turned into entrenched family wealth. The very first Forbes 400 list of the richest Americans, in 1982, remained chock-full of their progeny, as well as plenty of Mellons, DuPonts, and the like— some 63 percent of that inaugural Rich List pretty much inherited it. Many of the rest had a background that involved starting life on first, second or third base, in the mold of Rupert Murdoch or Donald Trump.

The technology revolution changed that dynamic, here and around the world. By 2002, a slim majority, 52 percent, of the Forbes global billionaires were self-made, including 59 percent of Americans. Ten years ago, that total had jumped to 69 percent globally.

The 493 new members of the Covid Newcomers of 2021, however, are in a class by themselves: 84 percent of them are self-made (including 90 percent of Americans), swelling the figure among billionaires overall to 72 percent—a record in each case. People like Whitney Wolfe Herd, who flipped the script on dating apps by empowering women; Tyler Perry, who started producing his own movies and television shows in Atlanta because no one would give him a break in Hollywood; and UÄŸur Åahin, the Turkish immigrant to Germany whose BioNTech helped produce a Covid-19 vaccine in months rather than years—all embody economic dynamism, not bloodline dynasties.

Opportunity stems from this dynamism, as these new billionaires illustrate. A decade ago, the median length of time it took a new billionaire in America to create his or her fortune, according to our data, was 18 years. Historically speaking, that’s extraordinarily fast. Among this year’s 88 new self-made Americans, that number has decreased drastically, to 13 years. The ability to rapidly translate ideas into riches helps level the playing field. Code (intellectual resources) trumps capital (accumulated resources), with the latter desperate for the former. A generation ago, fortunes went to those with the luck or pluck to secure funding; today, a good concept chooses which funding to accept.

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