The billionaire ‘nepo baby’ boom

In every country and culture, capitalism depends on an ideological mirage of equal opportunity and reward for effort, to conceal, as much as possible, the reality of brutal exploitation and inequality. In the US it’s the “American dream”—the idea that every person has the “equal opportunity to achieve success and prosperity through hard work, determination and initiative”, as defined in the Oxford Dictionary.

Here in Australia, we are more familiar with the “fair go”—a term beloved by Labor and Liberal politicians alike. It fits neatly with the myth of Australia as the “lucky country”: a land of promise and opportunity where, with the right work ethic and a bit of gumption, anyone can get ahead.

Last week Forbes magazine unveiled its rankings of the richest billionaires on the planet. An annual sycophantic tradition, this year the billionaires’ club ballooned to a record 2,781 members, collectively owning US$12.7 trillion—seven times the annual product of the entire Australian economy.

Beneath the headline figures was concealed a particularly galling fact. Of the fifteen billionaires who made up the “under 30” cohort, none amassed their fortunes through anything resembling actual work, investments or so-called entrepreneurialism. All of them received their vast wealth through inheritance from their families.

This phenomenon is just the latest consequence of a decades-long global neoliberal assault, involving privatisations, deregulations and attacks on workers’ wages and rights. What we’ve seen in this time is a massive transfer of wealth to the super-rich, to the point where today—according to the UBS Global Wealth Report 2023— the richest 1 percent of the population own 45 percent of the world’s total wealth.

The trend is clear here in Australia. According to data released by Oxfam in January, “the wealth of the three richest Australians, Gina Rinehart, Andrew Forrest and Harry Triguboff, has more than doubled since 2020 at a staggering rate of $1.5 million per hour”. And a 2023 report by the Australia Institute, Inequality on Steroids: The Distribution of Economic Growth in Australia, found that in the decade from 2009 to 2019, 93 percent of new wealth created through economic growth flowed to the richest 10 percent of households, while the bottom 90 percent got just 7 percent.

Amid the windfall being enjoyed by the billionaire class and their ultra-privileged and pampered spawn, it seems the “self-made” types—those like Facebook founder Mark Zuckerberg who can lay claim (in capitalist terms at least) to having built their fortunes for themselves—are not being replenished. Where are the new, young faces of innovation and entrepreneurship? You won’t find them among the under 30s in Forbes’ billionaires list.

We are now witnessing the beginnings of what has been described as the “great wealth transfer”. Over the next two decades, 1,000 or so ageing capitalists are set to pass on more than US$5.2 trillion to their heirs. Among them is 75-year-old Bernard Arnault, the world’s richest person, who has more than $233 billion, and 88-year-old Charles Koch, one half of the infamous Koch brothers, with $58 billion.

The children of these ageing tycoons will, in the coming years, be joining the billionaires’ club at an increasing rate. As with the film industry, so is it with the super-rich: instead of any new ground being broken, all we’re getting, increasingly, are sequels and remakes of existing franchises.

Who makes up the rogues’ gallery of beneficiaries? There’s Remi Dassault, who has $2.5 billion—grandchild of Marcel Dassault, the founder of Dassault Aviation. Remi’s wealth fell into his lap in 2021, when his father Olivier died in a helicopter crash. The Dassaults amassed their wealth, among other things, by manufacturing warplanes for the French military. Dassault Aviation also maintains cosy relations with the brutal el-Sisi regime in Egypt, its biggest international client.

Then there are the Mistry brothers, Zahan and Firoz, who each possess $4.9 billion thanks to having been born into a family with a significant stake in one of India’s largest conglomerates, Tata Sons. The company, which got its start wreaking devastation through the opium trade under British occupation, now spans 29 subsidiaries ranging from engineering to automotives, energy and hotels.

Or take the youngest member of the billionaires’ club, Livia Voigt. She’s only 19 years old and is studying at university. That hasn’t stopped her amassing a fortune of $1.1 billion, which might seem impressive until you learn that it was through being given that much in shares in the Brazilian electrical equipment giant WEG, which her grandfather was a co-founder of.

If you’re a 19-year-old in Australia starting university and hoping that—in accordance with the myth of the “fair go”—hard work and gumption will get you to the top, the chances that you’ll ever see your name among the members of Forbes’ billionaires list are approaching zero. More likely your hard work and gumption will, like the vast majority of other students, leave you with a gigantic HECS debt and lifetime of struggle just to attain the basics like a secure roof over your head.

To the extent that the myth of the “fair go” was ever a reality, it has long since died. If you’re a young aspiring billionaire, you’d better hope you’ve got a billionaire family to give you a leg-up. In today’s economy, that’s the only real path to success.