Side Note: Why do I share this article? Not because I share the opinion of the author in regards to ‘inequalities’. I share it because I want families to be aware of what happens in the various layers of society. While Radical Liberals have black and poor families drowning in the quagmire of grievance politics, others are busy solidifying their family wealth and life experience. It is my goal to wake people up to the fact that while uber wealthy may publicly state they are for liberal ideologies, they privately keep going with business as usual and at the end of the day or of our lives, wouldn’t we want to leave a legacy for our children that is more than played out slogans and protest signs?
– Leah Love
Getting to the airport can be a hassle for anybody, from highway gridlock to the long security lines. But thanks to Manhattan-based helicopter service Blade, you can travel from the West Side of Manhattan to JFK or Newark in just 10 minutes for $195 per person — three times the cost of a taxi.
And for some Blade clients traveling with American Airlines, passengers are dropped off near the gate, where a car waits to take them directly to the plane, bypassing the airport entirely.
“You get out of the chopper and into your Cadillac,” Blade’s cofounder Rob Wiesenthal explained in an interview with The New York Times. “You don’t even have to wait with other people at the gate, let alone deal with security.”
This isn’t the only way that life is getting easier for the rich. As Nelson D. Schwartz explores in “The Velvet Rope Economy: How Inequality Became Big Business” (Doubleday), out Tuesday, American companies are increasingly going out of their way to “pamper the biggest spenders and punish everyone else.”
The target demographic for the velvet rope economy, Schwartz says, are the one-percenters: the 19 million Americans who make, at the minimum, $871,320 a year, according to the 2018 Global Wealth Report from Credit Suisse Research Institute.
“By definition, the one percent is always just 1 percent, but that group has gotten much wealthier and their purchasing power is bigger,” Geoff Yang, a co-founder of venture-capital firm Redpoint Ventures, told Schwartz.
The rich are getting richer, in other words, and they “want the best and are willing to pay for it,” Yang says.
Never Miss New Posts
Please Subscribe to My Weekly Newsletter
Those willing to spend up to $1,000 for “Legends” tickets at Yankee Stadium get priority seating along the first- and third-base lines, with a “moat” (as disgruntled fans have dubbed it) separating them from the masses and menu items like swordfish ceviche.
At Levi’s Stadium, home of the San Francisco 49ers, a $5,000-per-season membership gets you access to an exclusive tailgate party hosted by Michelin-star chef Michael Mina. Menu items include Kusshi oysters, truffle mac and cheese, and Maine lobster pot pie.
At theme parks like SeaWorld, where visitors paying standard admission rates wait in endless lines, “priority” guests willing to spend thousands get private cabanas and a chance to swim with the dolphins. And at Stanford Hospital in northern California, select patients are given red blankets, which “quietly signal to doctors and nurses that they are treating a VIP,” writes Schwartz.
The velvet rope economy has crept into every aspect of modern life — health care, education, travel and leisure — providing those with enough money a friction-free existence, while the have-nots face “an increasingly Darwinian fight for a decent seat on the plane, a place in line with their kids at the amusement park, a college scholarship, or a doctor’s appointment.”
The velvet rope economy is often hidden from the rest of us. The details of Disney’s VIP Tours — which offer a guided and queue-free park experience for around $4,000 a day — are buried in the fine print of its Web site
At Blade, a Special Ops program with special amenities is available to only 500 of their best customers. When people inquire about the upgrade, the staff is instructed to play ignorant. “We don’t really talk about it,” Wiesenthal says.
Companies are learning how to use algorithms to “pinpoint and favor wealthy customers in ways unimaginable even a decade ago,” writes Schwartz.
How long you’re stuck on hold while calling a bank or other financial institution probably has nothing to do with whether you called during a peak time. It’s determined by your CLV, or “customer lifetime value.”
“This is a calculation of how much your business is worth to whoever you are calling,” Schwartz writes. “The higher the number, the better the service.”
If you find yourself waiting on the phone for 20 minutes or more, it has nothing to do with how many callers are ahead of you. The grim reality is: The longer the wait, the less your business is worth to them.
Never Miss New Posts
Please Subscribe to My Weekly Newsletter
And it’s not always a matter of pampering. The velvet rope can often mean the difference between life and death.
On average, it can take up to 21 days to get an appointment with a cardiologist in the United States. In Boston, just getting an appointment with the family doctor can take more than three months, which is almost twice as long as it took in 2009.
For an average patient trying to make an appointment with Dr. Ethan Weiss, one of the top cardiologists at the University of California, San Francisco Medical Center, “it’ll be next year,” Weiss admits. But as a patient of Private Medical, not only will you get to meet with him within days, you’ll be the focus of his attention.
“I can spend an hour and a half or two hours with these patients,” Weiss told Schwartz. “There’s a lot of psychiatry involved, and maybe a little rabbi and a little bartender.”
The cost to be a Private Medical patient can run upwards of $60,000 a year, and often into the six figures for a family plan. But what they get for the money is priority treatment.
“I don’t cut the line, I eliminate it.” says Dr. Jordan Shlain, who founded Private Medical.
If clients need urgent care — for a cancer diagnosis requiring a specialist ASAP — the wait will be almost nonexistent. They’ll get an appointment with a highly sought-after surgeon within days, not weeks or months.
“It’s not because we pay them,” says Shlain. “It’s because we have relationships with doctors all over the country.”
This same principle — paying for relationships, not just expertise — happens at IvyWise, a Manhattan-based private college counselor that’s “akin to a high-powered lobbying or public relations firm in Washington,” writes Schwartz.
For up to $150,000, the IvyWise counseling service gives high-school students applying for college insider information, like which schools need a goalie on their hockey team or are short on poetry majors. But IvyWise also offers connections.
“Let’s say we have a student who plays the cello and the top cellist at a school on her list is graduating,” founder Kat Cohen explained to Schwartz. “In some cases we can find that out.”
They may not be able to advocate on behalf of a student — which is technically illegal — but “we may be able to find out what their institutional needs are.”
It’s a system that works. According to IvyWise, more than one-third of their clients who applied to Harvard between 2014 and 2018 were admitted, compared with 4.7 percent of all other applicants. And forty percent of IvyWise applicants to Yale, Brown and Columbia were admitted, far more than those who couldn’t afford the service.
Our velvet rope system isn’t just infuriating for lesser mortals — it might also be doing more harm than we realize, Schwartz argues. By avoiding the routine friction that most people experience on a daily basis, America’s wealthiest individuals are barely aware that any friction exists at all.
When they “routinely bypass traffic jams and deteriorating trains and buses and get to the airport via a luxury helicopter service, the political impetus to improve public transit systems fades,” Schwartz writes.
And if you never have to face people who experience way harsher social and financial challenges, “it’s much easier to demonize them.”
Nick Hanauer, a Seattle entrepreneur worth hundreds of millions of dollars, told the author that he “hasn’t waited in a line in 10 years.” But he’s not bragging. He thinks the widening gulf between economic winners like himself and ordinary Americans is pushing the country towards civil war. “If you’re not genuinely concerned about the future of the United States, you are not paying attention,” he says.
Class warfare seems far-fetched but it’s not completely inconceivable. A 2016 study of major airlines (none were named specifically) by the University of Toronto and Harvard Business School found a significant link between “physical and situational inequality” among airline passengers and incidents of air rage.
Velvet ropes won’t be disappearing anytime soon. “The economics are too powerful,” Bill George, a professor at Harvard Business School, explained to Schwartz.
Even those who enjoy the luxuries of the velvet rope economy may soon find themselves priced out. During Schwartz’s visit to Yankee Stadium as a $500-per-ticket Legends ticket holder, he noticed a fancy lounge that was off-limits even to VIPs like himself.
A guard told him the room is reserved for front-row Legends members. Even though Schwartz was in the second row, he wasn’t welcome.
“It turns out that when it comes to exclusivity,” Schwartz writes, “there always has to be a sanctum sanctorum to remind you that you haven’t really reached the pinnacle.”