The economy is down but America's wealthiest are up, proving that it pays to be your own boss.
Despite the stalled economy, the nation's wealthiest are worth a combined $1.53 trillion, nearly equivalent to the GDP of our neighbor Canada. Their total wealth is up 12% in the year through August 26, when we took a snapshot of everyone's net worth, meaning these affluent folks did slightly better than the markets; the S&P 500, for instance, was up 10% in that time.
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Youngest American Billionaires
Billionaires in the Making
But it's not simply a case of the rich getting richer. The Forbes 400 grows more meritocratic over time. An all-time high 70% of this year's list are self-made, up from 55% in 1997.
Bill Gates was the richest person for the 18th straight year, worth $59 billion; the last time he didn't rank no. 1 was in 1993 when his good friend Warren Buffett was on top. Buffett, who's been spending a lot of time talking about raising taxes on the rich, is still no. 2 but the gap is widening. His fortune tumbled $6 billion in the past year, making him the biggest loser in terms of total dollars. He gave away $3.27 billion since last year's rankings but was also pinched by a 10% drop in Berkshire Hathaway's stock.
Rounding out the top 10 on The Forbes 400: Oracle founder Larry Ellison ($33 billion), industrialists Charles and David Koch ($25 billion apiece), Wal-Mart heirs Christy Walton ($24.5 billion), Jim C. Walton ($21.1 billion) and Alice Walton ($20.9 billion), hedge fund investor George Soros ($22 billion), and casino king Sheldon Adelson ($21.5 billion).
The headlines in this our 30th year of The Forbes 400 belong not to the old stalwarts but to a younger group of entrepreneurs marching their way up the ranks, particularly those who are profoundly impacting social behavior online. These entrepreneurs are using technology to unleash power and make fortunes, and it is these folks who will likely help jump-start the American economy again.
Leading the pack is Facebook's Mark Zuckerberg, who added $10.6 billion to his fortune, making him the year's biggest gainer and pushing him into the top 20 for the first time — he ranks no. 14 with a net worth of $17.5 billion. That puts him ahead of Google rivals Sergey Brin and Larry Page, who added $1.7 billion apiece to their fortunes but slipped five spots in the rankings and are tied at no. 15.
The hoodie-clad 27-year-old Zuckerberg is one of 6 club members to get rich from Facebook. Others include newcomers Sean Parker and Jim Breyer, Facebook's venture capitalist, as well as Zuckerberg's former roommate Dustin Moskovitz, whose birthday is eight days after the Facebook chief's, making him America's youngest billionaire. Three other social media mavens made their debut including LinkedIn's Reid Hoffman, Groupon's Eric Lefkofsky and Zynga's Mark Pincus.
Other notable entrepreneurs among the 18 newcomers include Green Mountain Coffee's Bob Stiller, Go Daddy's Bob Parsons, and energy tycoons Farris and Dan Wilks. Six people, including Starbucks' Howard Schultz and Quicken's Dan Gilbert, returned to the list after a year or more absence.
Three members of last year's list have died: John Anderson, William Cook and Jess Jackson. Twenty-one missed the cut, including at least a dozen billionaires, like University of Phoenix's John Sperling, whose net worths were just shy of $1.05 billion, the price of admission in 2011.
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Net Worth: $59 Billion
Residence: Medina, WA
The top mission for the world's most magnanimous human being Bill Gates (he's already given away $28 billion) is to end polio, which still exists in four countries and requires $1 billion a year for vaccinations; his foundation chips in $200 million. He's also tackling malaria by providing more bed nets and backing development of a low-cost vaccine. Slower progress on the education front: After delivering $2 billion-plus in grants to help high schools from 2000 to 2008, Gates admitted that efforts "fell short." Just one-fourth of his net worth is still held in Microsoft (Nasdaq: MSFT - News); the rest is in private equity, global stocks, bonds and private companies. With help from billionaire buddy Warren Buffett, he's convinced nearly 70 of the world's wealthiest to sign his "Giving Pledge," promising to donate the majority of their wealth to charity either during their lifetime or after death. In April toured Amazon ruins and jungles with wife, Melinda, and their children.
Net Worth: $39 Billion
Source: Berkshire Hathaway
Residence: Omaha, NE
Warren Buffett, the second richest man in America, thinks he and his fellow billionaires should be paying more money to Uncle Sam. In August Buffett penned an opinion piece in the New York Times arguing that tycoons need to pay more taxes: "While the poor and middle class fight for us in Afghanistan, and while most Americans struggle to make ends meet, we mega-rich continue to get our extraordinary tax breaks." That same month Buffett went bargain shopping and invested $5 billion in beleaguered Bank of America, a move similar to his backing of Goldman Sachs during the credit crisis. Buffett suffered a rare blemish this March after top executive and potential successor, David Sokol, resigned amidst allegations of self dealing; charges were never filed. Meanwhile shares of his conglomerate, Berkshire Hathaway (NYSE: BRK-A - News), have fallen 10% since last August, while the S&P 500 climbed 10% over the same span. Along with billionaire buddy, Bill Gates, Buffett continues to push the Giving Pledge, wrangling new tycoons to agree to ultimately give away 50% of their fortunes. The son of Nebraska stockbroker met value investor Benjamin Graham while studying economics at Columbia. Took over textile firm Berkshire Hathaway in 1965, company now holds vast investments including banks, insurance, railroads and restaurants.