Review: Richistan

This appeared in USA Today on June 17.

By Russ Juskalian, Special for USA TODAY
Somewhere in the world, 100-foot yachts are derided as "dinghies," it takes five people and a handful of e-mails to remove a mouse from the kitchen and "true wealth" starts at a hefty $10 million.

That's "Richistan"

The term, which journalist Robert Frank defines as a "parallel country of the rich," is also the title of his new book about its inhabitants, whom he calls Richistanis. The book got its start in 2003, when Frank, who reports for The Wall Street Journal, picked up a fresh, full-time beat: the new rich.

"I immersed myself in their world, hanging around yacht marinas, slipping into charity balls, loitering in Ferrari dealerships and scoping out the Sotheby's and Christie's auctions," he writes.

Meet Jeeves 2.0

It's telling that Frank's first chapter, "Butler Bootcamp," is not about the rich themselves, but about the men and women who care for the rich: "household managers," aka butlers. Strike the image from your head of a stuffy, balding, accented man named Jeeves, Frank writes. The rich actually prefer their household managers to be something more akin to a "chief operating officer for My Life Inc."

"Jeeves 2.0" should be able to manage a budget of a few million dollars a year, prepare Excel spreadsheets documenting all facets of the house, program security and household technology systems, take care of travel plans, and oversee the systematic management, cleaning, and organization of a 30,000-plus-square-foot house that employs dozens of full-time and part-time workers.

Household managers of this caliber have become such a sought-after luxury that trainees pay as much as $13,000 or more to hone their service skills at specialized institutes. Graduates of these programs command starting salaries in the $80,000-to-$120,000 range (including free housing and other perks).

The new Gilded Age

The reason household managers are so sought after is that the ranks of the rich, in America in particular, are expanding at a startling rate. From 1995 to 2003, the number of millionaires in America doubled. During the same period, the number of households worth $5 million, $10 million and $25 million, respectively, all doubled. In 2005 alone, America minted 227,000 new millionaires.

It's a boom so big that Frank is not alone in calling it the new Gilded Age, or Frank's preferred term, the "third wave." The first two waves were the Gilded Age, after the close of the Civil War, and the Roaring Twenties (1920s).

Frank speeds through the causes of this current boom, namely, IPO stock offerings, sophisticated — and global — means for moving money around, a foreign savings glut and the general effects of globalization and technology adoption. But he's far more interested in showing us how "the other half" lives.

While Richistan might not be the most informational book on the shelves, Frank's candid look at how the ultrarich live is thoroughly entertaining. Unlike other such accounts (sometimes labeled as exposés), Frank indulges in neither idolatry nor condemnation of his subjects.

Wealthy ways

We meet a group of formerly middle-class characters who somehow struck it big in everything from the tech boom of the late 1990s to things as esoteric as selling ceramic villages, creating a new type of mozzarella cheese or inventing the Dogloo (an igloo-shaped doghouse). Frank writes that many of the rich came to their wealth by becoming "masters of the banal."

Unlike inherited Old Money of the past (aristocratic families that can be traced to Europe), this new crop of arrivistes inhabits a bipolar world. On one hand, many claim to be down-home, simple, middle-class folks. On the other hand, they have taken conspicuous consumption to new heights — or lengths, in the case of 450-foot yachts.

And in comparing Old Money with New Money, Frank draws on material that is sure to delight both the vicarious and the voyeuristic.

There are squabbles in Palm Beach, clashes over $400,000 golf club memberships and general one-upmanship all over the place.

New model of philanthropy

Richistan doesn't set out to make any serious waves in the world, but it closes on an interesting note. The new rich have a different approach to philanthropy that might in fact make big waves — and Frank's notice of this is surely an early account of more to come.

Instead of donating money to major charities with sizable overhead costs, many of the new rich have devoted the second part of their careers to running their own philanthropies based on business principles, some as for-profit organizations.

They are trying to eliminate inefficiencies, doing analysis to find out what is the best investment per dollar with regard to progress made with their donations, and running teams to do their work that must present detailed business plans of the work.

Andrew Carnegie (the Gilded Age iron and steel tycoon), for all his faults, started a philanthropic trend that has persisted to this day.

Perhaps the new rich will significantly improve on the dream that Carnegie pioneered, and in doing so, leave the world a better place.

As Frank prescribes for the rest of us, "We can only hope."