Philanthropist with Panache: The Homeless Billionaire Do-Gooder

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October 2011; Source: Wall Street Journal Magazine | The Wall Street Journal Magazine theme for October 2011 is “Playboys, Philanthropists, Surfers, Entrepreneurs, & Dandies.” It’s a bit hard to sort them out in order to determine who the philanthropist might be, but let’s try a process of elimination. It’s not David Beckham, soccer’s fading “golden boy” (pictured on the cover wearing a $1,495 sport coat). It’s not Luca Cordero di Montezemolo, the chairman of Ferrari, who might want to replace Silvio Berlusconi as Prime Minister of Italy one day. It’s not the “Beau Brummels of Brazzaville” who consider “stylish dressing…a refuge from poverty and war” in the Congo. And it’s not the six surfers modeling the latest knits and cardigans (one priced at $3,295).

No, the philanthropist in the group is Nicolas Berggruen, described as “rich, handsome and homeless” with a desire to “save the world.” Looking a bit like a cross between John Edwards and Jimmy Fallon, Berggruen is pictured lying on his bed in his bathrobe, holding two stuffed animals, in his room at the Carlyle Hotel in New York City, where he calls home. Apparently, the billionaire—who owns stakes in Germany’s Karstadt department store chain and Spain’s Prisa media conglomerate—eschews such luxuries as homes, cars, wristwatches, spouses, and children, though he does keep a private jet for transportation purposes.

It’s a little hard to discern exactly what the high-end WSJ Magazine defines as “philanthropy” in Berggruen’s case. Maybe it was his acquisition of Karstadt (for the sum of one euro, since Karstadt was insolvent at the time), which WSJ Magazine says saved 25,000 jobs. Maybe it was the fact that he loaned his art collection (his father, a friend of Picasso’s, was a major art collector) to museums as he sold off his homes (including an island estate in Florida and an apartment in New York) to become a homeless billionaire philanthropist.

More likely, the philanthropist tag comes from two things: (1) Berggruen’s attempt to establish a regional commodities exchange in East Africa and (2) his efforts to fix the government of California. WSJ Magazine says that Berggruen convened a meeting that included Condoleezza Rice, George Schulz, Eric Schmidt, Gray Davis, and Arnold Schwarzenegger, from which emerged two ideas: establishing a Rainy Day Fund and allowing the California legislature to pass a state budget with a simple majority rather than a two-thirds supermajority.

Apparently, Berggruen has “poured tens of millions” into this California big-name committee and presumably he has helped fund meetings concerning the East Africa commodities exchange as well. More recently, he got Gerhard Schroeder, Tony Blair, Felipe Gonzalez, and Joseph Stiglitz to form the “Council for the Future of Europe,” to review proposals that have stymied sitting politicians. According to WSJ Magazine, Berggruen’s goal is to “revive the proverbial smoke-filled room, a place where ‘eminent’ figures can gather behind closed doors and calmly redesign government.”

This strikes us as the worst side of billionaire philanthropy. Somehow money becomes the means to remove voice and power from the people and leave it to the gentlemen (and they are all men in the WSJ Magazine article) in smoking jackets at exclusive clubs (or hotels like the Carlyle) to dispense their enlightened judgments.—Rick Cohen