Gateway to Sources and Information About Income Inequality in the United States

Millions of Americans are working longer hours for lower wages, and yet almost all of the new income and wealth being created is going to the top one percent. While the top one percent have seen their incomes rise 18 percent over the past decade, those in the middle have actually seen their incomes fall. 
  Scholars, from the Nobel-Prize-winning Paul Krugman to the widely respected economist James Surowiecki, have been working to analyze these disparities. Americans are not generally aware of the extent of this income inequality. In most developed countries, there is a direct relationship between income inequality and the public's views about the need to address the issue – but not in America, where income inequality is worse but the concern is lower. The most commonly accepted measurement of income inequality, the Gini Index, ranks the United States sixth-worst among 173 nations. 
   Private-equity companies are far more obviously connected to an undue concentration of wealth at the expense of workers and communities than are collateralized-debt obligations, which were at the core of our 2008 Great Recession. Within the one percent, there is a top one percent that consists disproportionately of private-equity and hedge-fund principals.

BILLIONAIRES’ ART TRANSACTIONS

“DMITRY RYBOLOVLEV [a Russian Oligarch] was the billionaire whose money was building the freeports [that the Economist described as ‘Uber warehouses for the ultra-rich.’] From 2008 onward, his life and finances became increasingly unsettled, but the net result was that his spending on art dramatically increased. That year, he and [his wife] Elena separated. According to [Yves] Bouvier, Elena had always been conservative. With her out of the way, Rybolovlev seemed to have fewer inhibitions. Through a network of trusts, he bought Donald Trump's mansion in Palm Beach, Sanford Weill's apartment on [New York’s] Central Park West, and the island of Skorpios, in Greece, which used. to belong to Aristotle Onassis. And he pressed forward with his art collection.

“Rybolovlev had other reasons to spread his money around. In late October, 2008, the oligarch was summoned to Moscow, where he was told that a government investigation into an accident at his potash company, Uralkali, was being reopened. Uralkali had previously been cleared of any liability after an
incident, in 2006, in which a mine in the Ural Mountains flooded with brine and a huge sinkhole opened in the ground. The fresh investigation caused Uralkali’s stock to plummet. The company paid two hundred and fifty million dollars in compensation, and the inquiry recalled the authorities' pursuit of other state-owned assets that had been questionably acquired in the nineteen-nineties.

“The pressure persuaded Rybolovlev that his assets were no longer safe in Russia. In June, 2010, he sold his controlling stake in Uralkali for an estimated five billion dollars. This sudden influx of cash brought its own complications, however. By this time, every one of Rybolovlev's financial maneuvers was being scrutinized by his estranged wife and her lawyers. The oligarch instructed [Yves] Bouvier to find him ‘mobile assets.’

“He [Bouvier] went to work. Between 2003 and 2007, Bouvier had sold the Russian six art
works. Between 2008 and 2013, he sold him twenty-eight. He summoned every hunch, every contested inheritance, every paid informant, every whispered tax problem gathered from two decades operating inside an art market that had never paid him much attention. ‘If nobody knows
you, you take all the information,’ he told me. ‘It is to be like an octopus.’

“Rybolovlev had a taste for Modigliani nudes, for example. Bouvier knew that Steve Cohen, the New York hedge-fund manager, had one of the finest, ‘Nu Couche au Coussin Bleu,’ but also
that he had no plans to sell. In November, 2011, however, Bouvier learned through an informant that Cohen had just bought four Matisse bronzes from Sotheby's in a private sale for more than
a hundred million dollars. Approaching Cohen through Lionel Pissarro, a dealer in Paris, Bouvier managed to buy the Modigliani, for $93.5 million.

“In 2013, he secured a Gustav Klimt masterpiece, ‘Wasserschlangen II,’ that had been seized by the Nazis. The day after lawyers concluded a lengthy dispute over its ownership, Bouvier sold it to Rybolovlev for a hundred and eighty-three million dollars. He bought a Gauguin that had not been sold since the Second World War and a lost Leonardo da Vinci, ‘Salvator Mundi,’ that had been sensationally rediscovered. On its display at the National Gallery in London, the da Vinci became one of the most talked-about pictures in the world. According to [Rybolovlev’s confidante, Tania Rappo], Rybolovlev wanted it for the wall of his study. Bouvier brought the painting to the Russian’s apartment in New York, where, Rybolovlev told me, he experienced a profound emotional reaction – ‘vibration' – in its presence. He bought the picture for $127.5 million.”

Sam Knight, “The Bouvier Affair, How an Art-World Insider Made a Fortune by Being Discreet,” New Yorker, February 8, 2016, pp: 62-71(67).