Forbes released it’s annual list of the world’s billionaires and it shows that America is increasingly becoming a nation of self-made elite. Since Forbes started keeping track in 1984, the number of completely self-made billionaires (who grew from little wealth) tripled to 8.5%, while the number of those who inherited all of their current wealth fell from 24% to 7%.
This year, the youngest self-made billionaire is both a woman and a college drop out, Elizabeth Holmes, who revolutionized the blood testing market through her company, Theranos.
“With the large improvements in information technology and the substantial increase in value of the securities markets over the last 30 years, skilled individuals can now apply their talent to much larger blocks of capital,” concluded the University of Chicago’s Steven Kaplan [PDF].
Generally speaking, the billionaires are getting younger. Snapchat founder Evan Speigal is a billionaire at the incredibly young age of 24, while Facebook’s Mark Zuckerberg is just 30. The young set of the world’s elite began their massive companies with little more than a laptop.
It is tempting to argue that the rise of young super-wealthy has coincided with growing financial inequality, but that is not quite the case. Much of the total inequality between the rich and poor has mostly grown between the sort-of-rich and the mega-rich.
“It turns out that wealth inequality isn’t about the 1 percent v. the 99 percent at all. It’s about the 0.1 percent v. the 99.9 percent,” wrote The Atlantic’s Derek Thompson.
Inequality is still a (very big) problem. But, the changing nature of the elite means that wealth isn’t confined to an exclusive class of individuals who renew their unearned wealth at the expense of everyone else.
Read more about Forbes’ list of billionaires here.
*The Ferenstein Wire is a syndicated news service. Clients may edit each story. For questions, email Greg Ferenstein at greg@gregferenstein.com
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