Meet the New Richest Man in the World
“Every billionaire is a policy failure.” — Dan Riffle
Most people haven’t heard his name, but they certainly know the brands that his massive French conglomerate has swallowed whole:
Moët & Chandon
After watching his wealth more than double during a global pandemic, the world’s wealthiest man now has a net worth that clocks in at nearly
Bernard Arnault — nicknamed The Terminator and The Wolf in Cashmere — was able to create the most valuable company in Europe for one reason: Society has failed to stop him from swallowing his competition.
After working for his father’s real estate empire, Arnault’s first deal came in 1984 when he partnered with a banker to acquire a luxury goods company, which then bid to acquire the parent company of Dior. He promptly fired 9,000 workers who’d built the company, stripped it to the bones, and took off with Dior.
From there, he performed a hostile takeover of LVMH and ousted its CEO. After that, he set his sights on Céline, then Berluti, then Kenzo, and even went after a French newspaper. He attempted a hostile takeover of Gucci, but the board managed to outmaneuver him so he took them to court. When the dust settled several years later, he LVMH walked away with a $700 million profit.
And so it has continued for decades — financialization, hostile takeovers, mass firings, consolidations, integrations, rinse and repeat. Business. American-style. Winner take all, loser workers be damned.
Today, Arnault controls more than seventy former competitors, including Marc Jabobs, Stella McCartney, Loro Piana, Princess Yachts, Bulgari, Sephora, a winery that’s been around since the 1300s, and more than 40 hotels, trains, and cruises.
As of this morning, Arnault presides over an empire with a market cap of nearly $400 billion. (If Arnault’s company was a meme stock like Tesla and had a similarly outrageous price-to-earnings ratio, he would be the world’s first trillionaire.)
It may be surprising that Arnaud’s company thrived during a pandemic in which hundreds of millions suffered, but LVMH’s revenue actually rose by 35%, particularly due to strong demand from wealthy Chinese shoppers. Even Arnault’s buying spree continues unabated through the crisis — in January, LVMH bought Tiffany & Co for $15.8 billion, possibly the biggest luxury brand acquisition in history.
For all his machinations and manipulations, society has rewarded Arnault richly —he’s been awarded the Grand Officier de la Légion d’Honneur, the Woodrow Wilson Award for Global Corporate Citizenship, and an Honorary Knight Commander of the Most Excellent Order of the British Empire. He also owns Picassos, Andy Warhols, and a 333-foot yacht.
But what has he contributed to society, really?
Has it been a net societal benefit worth $190 billion, worth more than, say, all the doctors and nurses in England’s National Health Service?
It’s ironic that our global economy rewards people like Bernard Arnauld. He doesn’t sew handbags. He doesn’t harvest grapes. He doesn’t mine diamonds. That’s what sweatshops, migrant workers, and African children are for.
Arnault doesn’t even start companies — he just manages corporate capital; and in a corporatist economy, that’s the only job that’s truly valued.
Arnaud’s rise to the top should trouble anyone who isn’t a sociopath. It should be deeply concerning that in a world where one million people per day are forced into the abject poverty and danger of slums, the wealthy spend $39,000 on Louis Vuitton handbags and further enrich a billionaire monopolist who will literally never stop until he is stopped.
The massive spike in luxury spending during a global health crisis should make it painfully obvious: The hyper-rich simply do not care if our global family starves.
It’s why we need a global minimum corporate tax rate.
It’s why we need to end tax havenry.
It’s why we need an obsenity tax on outrageous luxury purchases.
Because the gap between the rich and poor is growing, and our inevitable economic trajectory is clear:
- A handful of isolated trillionaires
- Deep economic hardship for the current middle class due to rising prices
- The bottom 3+ billion in squalid slums
- A collapse of the natural world
Friends, we’re headed in the wrong direction. We need a circular bioeconomy that works for everyone, but especially the poor and the planet.
We need to turn this ship around.
The first step is to return that handbag.