I should point out that, although Lanai was formed millions of years ago by a volcano, there aren't actually any active volcanoes on that island. The only active ones are on the Big Island (also known as Hawaii).
HONOLULU – Landowner Castle & Cooke has filed a transfer application with the Public Utilities Commission. Castle & Cooke owns 98 percent of the island’s 141 square miles. The buyer is Lawrence Ellison, co-founder and chief executive officer of Oracle Corporation.
Governor Neil Abercrombie today released the following statement: “It is my understanding that Mr. Ellison has had a long standing interest in Lana'i. His passion for nature, particularly the ocean is well known specifically in the realm of America’s Cup sailing. He is also a businessman whose record of community involvement in medical research and education causes is equally notable.
“We look forward to welcoming Mr. Ellison in the near future.”
From an environmental perspective, a single landowner like this, who isn't going to put it to intensive development or use, is probably the best thing which could happen to a place like Lanai, other than becoming a park or nature preserve of some sort.
I live in California, US and I keep seeing news paper articles warning each year that our State Government is short on cash and considering sale of State Land...
I also read of the added costs of cleanup after the latest meth-lab/pot-farm bust finds terrible accumulated waste and in some cases, caustic chemicals left behind... Illegal operations have little incentive to be kind to the land.
He might develop some of it, but not intensively -- he's not going to build 100k condos or anything like that (why would he bother?). It's presumably going to be a high end/exclusive place for him, like Necker Island is for Branson.
It's private property, why should you get any assurance?
A state or federal park program is about as far away from an assurance as you could get. The feds and states sell off land all the time for development, and given the entire US Government system is bankrupt, that trend will accelerate.
Richard Branson, Elon Musk. Even Larry, Sergey and Eric recently acquired a fighter jet.
Then you've got Silvio Berlusconi, who bought himself the Prime Ministership of Italy and spent the whole time having what he called "Bunga Bunga Parties", which is closer to my fantasy at sixteen than my fantasy at nine, but it'll do.
Actually Silvio was "forced" into politics by the demise of his protector, Bettino Craxi (who, incidentally, was instrumental in engineering Silvio's rise to riches). He was into bunga-bunga before, he just carried on despite his 70+ years.
His "billionaire behaviour" was more about buying or building outrageous McMansions around the country, which is typical of his original background (a property developer with shady links to the mafia).
I once read that Ellison had very little wealth outside of his Oracle holdings. In fact, that he had borrowed against his stock in order to make the vast majority of his enormous purchases. Does that mean there will be one hell of a fire sale in Hawaii should Oracle hit the skids? And what sort of mind must one have to borrow upwards of a billion dollars rather than just sell some shares?
It's a common financial strategy among the fabulously-wealthy. Selling shares would incur all kinds of taxes, but he can get a line of credit with a reasonable interest rate quite easily, pay no income taxes, and actually deduct the interest he pays from his taxes. So he carries a lot of debt but it's all backed by assets and paying the interest is tolerable.
Yes, if that's what he's doing, then in the event that his assets utterly evaporate he'll be in a spot of bother. But it's a pretty well-trod path, and probably some non-trivial portion of his assets are quite stable and reliable and not terribly volatile. I won't pretend to know the precise details of his situation, but living off a line of credit isn't at all uncommon and perhaps isn't even unreasonable (from the perspective of financial self-interest alone) for a person in his position.
Almost all the property on the island was acquired by Dole as a pineapple plantation back in Ye Olden Days when it was easy for Dole to do that sort of thing (1920s), and somehow the property has never gotten broken up in the decades since then, so Ellison just bought it from the til-now-current owner, who owns it via a chain of purchases from Dole and subsidiaries.
This isn't a post about any economic theory or about debating the morality of the fixed pie fallacy. It's about knee-jerk moralistic responses to complex phenomena.
It's just weird to see such things pop up on HN these days.
It goes against the spirit of this community (satisfying intellectual curiosity) because even though a knee jerk reaction has its place, it can't help you find the answers. It just muddies up the waters.
Monarchy may be making a big comeback. And that's a GOOD thing. Try taking a break from jerking your knees and read "Democracy: The God that Failed", by Hans-Hermann Hoppe:
MONARCHY, DEMOCRACY, AND THE IDEA OF NATURAL ORDER
From the vantage point of elementary economic theory and in light
of historical evidence, then, a revisionist view of modern history results.
The Whig theory of history, according to which mankind marches continually forward toward ever higher levels of progress, is incorrect.
From the viewpoint of those who prefer less exploitation over more and
who value farsightedness and individual responsibility above short-
sightedness and irresponsibility, the historic transition from monarchy
to democracy represents not progress but civilizational decline. Nor
does this verdict change if more or other indicators are included. Quite
to the contrary. Without question the most important indicator of exploitation and present-orientedness not discussed above is war. Yet if this
indicator were included the relative performance of democratic republican government appears to be even worse, not better. In addition to
increased exploitation and social decay, the transition from monarchy to
democracy has brought a change from limited warfare to total war, and
the twentieth century, the age of democracy, must be ranked also among
the most murderous periods in all of history.
That knee jerk objection must have taken you all of two seconds to come up with!
Like most interesting ideas, this one is NON-obvious. Try at least looking at the Amazon page for the book, or check out Lew Rockwell's enthusiastic endorsement of Hoppe's work, if you are part of the tl;dr crowd. It's FAR from ridiculous.
The resources won't be used efficiently if the few with all the power/money can press their priorities on the rest of the populace. In the US, this takes the form of billionaires heavily influencing government policy, both through party funding to draw up the legislature and propaganda to win votes. In looser countries, this effect is even more direct.
You have to count on benevolent tyrants if you allow wealth concentration to run its course. That's hoping for a lot.
We're not really seeing this efficiency, though. For all the money being funneled into a small set of people, most of whom are not entrepreneurs but well-connected parasites, there's very little coming of value out of it.
Take human transportation. We're abysmal at it. Sure, we've gotten great at sending bits around, but for a person to travel from New York to London still costs several hundred dollars. The average person who works in New York commutes for about 35 minutes each way, and the inefficacy of our transport systems (all around the world) is reflected in ridiculous real estate prices. All of this is an unmitigated disaster, and the concentration of wealth isn't solving any of it.
(For local transport, the solution is to tax landowners at extremely high rates and use the proceeds to build the world's best public transportation system in every major city, thus bringing housing costs down by increasing the available supply. The long-distance problem is harder and requires innovations in our energy policy.)
There are big, real problems for humanity to solve, and rich people living out dreams based on what they saw in "kid-gets-rich" movies written decades ago do not solve them.
"We're not really seeing this efficiency, though. For all the money being funneled into a small set of people, most of whom are not entrepreneurs but well-connected parasites, there's very little coming of value out of it."
Wow, that's such an absurdly broad, unprovable statement. You're talking about millions of people around the planet that qualify as millionaires (most of which are in the developing sections of the Asia Pacific region). So would you care to be very specific when slandering millions of people? Is Larry Page, or Jeff Bezos a parasite? How about Ellison? How about Gates? How about Sheldon Adelson, who built his empire from nothing and employs 40,000 people. How about Steve Jobs, was he a parasite? Who did Larry Ellison steal his wealth from in building the first major relational database company? How about the founders of Twitter, they're scumbag parasites, right? They're worth hundreds of millions. How about the founder of the 99 Cent stores? Was Sam Walton a big evil parasite? And on and on the list goes.
Oh but you didn't mean THOSE rich people. So which very specific ones did you mean? Care to go down the Forbes 400 and name them all? No? Because for every one you can name, I can name ten that are not parasites.
Sure it is. If we have an economy of ten people, it is inherently bad for one person to control 100% of the wealth while 9 people starve to death. That is, in fact, inherently bad.
To put it another way, we know that the marginal utility of wealth decreases as wealth increases. Therefore under the standard principle of greatest good for the greatest number, social good is maximized when wealth is evenly distributed.
In this case however it would be more like 10 people having $1, then one of them building something and all of them agreeing its worth $100. The other 10 haven't lost anything in the one becoming much wealthier.
The marginal utility of consuming wealth for one's personal use diminishes, but empirically that is not what the wealthiest people do. They give their wealth away in intelligently measured ways. It's quite possible that giving 10 million random middle-class Americans more of Bill Gates' money would do less good than Bill Gates has done with it trying to solve the whole malaria problem.
Sure does. It's the concentration of wealth into the hands of a government, which is made up of people.
Oh, you're only talking about the concentrating of wealth into private hands? I reject that arbitrary separation. It still matters where wealth is concentrated, even if you choose to disregard such so long as it's controlled by people in government positions.
You don't think the $236 billion paid out to federal civilian workers every year is concentrating of wealth? Yeah right.
According to the USA Today:
"By 2009, there were 383,000 federal civilian workers with salaries of more than $100,000"
That's not concentration of wealth?
How about: "In 2010, federal worker compensation averaged $126,141, or double the private-sector average of $62,757."
Oh, look how counter-intuitive this reasoning is! It must therefore be deeply insightful.
Except it requires throwing out most normal definitions of "concentration" and "wealth", and requires the belief that government is the "other" rather than government (in a democracy) being some reasonable approximation of public will (I'm not suggesting that government can't, or hasn't frequently within history become a horrible other -- but one has to adopt a rather extreme anti-government position to subsequently see the current U.S. government as the enemy, and equate accountable government power with unaccountable private power).
Which federal employee can spend 0.5% of their wealth and completely change the outcome of an election to the Senate? Or 0.1% of their wealth and get subtle legislation written at a 10x ROI? Or spend 0.05 % of their wealth and fund three professorships at a university whose primary role is to intellectually buttress their own self-serving ideology?
Trillions of dollars controlled by a few hundred men and women in the lower house of the Congress. And even fewer on the subcommittees that controls each of Pentagon spending, welfare benefits, and salary budgets.
... and they can be removed from these positions every two or six years. And they have to glad-hand and defend their positions and votes regularly. And even if you contend that they might be bribed or engage in dubious deals, their compensation for doing so is orders of magnitude less than the kinds of lobbying returns found by industries that generate billions of revenue each year.
Seriously, billionaires and those who have ownership and direct control over billion-dollar-enterprises are accountable to no one. History has shown that wealthy interests have repeatedly exploited their advantages politically and financially to the detriment of everyone else (yes, governments fail too, but rarely democratic ones). You are telling me that I should be more concerned about the power society has decided to give to their elected representatives, and relatively less concerned about the influence of an increasingly wealthy elite, who, with every additional dollar at their disposal, render less powerful everyone else?
Government is ultimately accountable to the people. Private individuals are not.
Talking about the middle class as the concentration of wealth is laughable. It's the super-rich's wealth that is the concentration, because all that power is held by a small group that have interests and priorities different than the vast majority. A large middle class, by definition, is a bulwark against this, because they are a large amount of people with interests more in line with the general populace. They need health care, good roads, various government agencies. The super-rich really, really don't.
Also, if you think a $100,000 salary in the US is rich, you're wrong. It's very nice, but it's not "rich".
It could be bad. Wealth that moves through the economy tends to keep people employed. Now, take all the money that's being spent and therefore paying N people, and put it in a room. That's bad, I think.
jellicle addresses your first claim well. As for the second, it is because there is a government, elected by the people (ie. everyone), that imposes laws on everyone, that Ellison will not be able to abuse his ownership dramatically. Were Ellison an independent count in 10th century West Frankia (France), I would not be betting on his generosity.
After being "discovered" by Europeans, the island was used for ranching. Most of it was owned by one guy, Walter Gibson. Then James Dole (of Dole food company) turned the island into the world's largest pineapple plantation. Castle & Cooke acquired Dole, then changed their name to Dole, then spun off a new company called Castle & Cooke, which was bought by the CEO of Dole, David Murdoch. Murdoch just sold his 98% of the island to Ellison. Currently there is only one town on the island, population 2,000.
There are also two pretty nice resorts and a couple of golf courses. It is a weird ecology compared to the rest of Hawaii; Maui gets most of its rain so it is rather dry and has pine forests and a lot of deer.
The Louisiana Purchase was a scam that went awry. Napoleon "sold it" so he could raise money for his European campaign. The plan was to sell it to the Americans then take it back through force after he successfully conquered Europe.
Really? By my understanding it was more of a fire sale--between trying to conquer Europe and the slave revolt in Haiti, Napoleon was convinced that it wasn't worthwhile to hold onto useless colonies in America when he could have all of Europe in his grasp.
Sorry, I don't. Just an opinionated, french father-in-law steeped in french history and colonialism.
One of the things I quickly learned after leaving the US is that American historical events are viewed very differently in different sides of the world. Maybe some of the french HNers can give the french perspective.
My understanding is just the interpretation of US history books and one grumpy, old frenchman.