0:11

Peter Franklin had been running a successful

0:13

woodworking business on Lanai, Hawaii,

0:16

when Larry Ellison, one of the richest people

0:18

on the planet, but nearly the entire

0:20

island for about three hundred million dollars.

0:23

This was back in There

0:25

are feelings of both angst and excitement

0:28

as Lenite residents prepared to welcome new

0:30

billionaire owner Larry Ellison.

0:33

Larry Ellison loves to go shopping

0:35

for big things seton bought a Hawaiian

0:37

island recently. In his first interview

0:39

since buying three months ago, Larry

0:41

Ellison shows he's as ambitious

0:44

as he is rich. The news

0:46

meant that Peter had a new landlord, and

0:49

at first things went relatively well.

0:52

For one, he had a new spending client. Ellison's

0:55

people asked Peter to make some furniture and

0:57

hired his shop, Lanai Woodworkers, for

1:00

one of his first projects on the island, building

1:02

a Nobu, you know, the Japanese

1:05

restaurant known for its celebrity sightings. Here's

1:08

Peter remembering one of the earlier projects

1:10

he did for Ellison. Mr. Ellison

1:13

was starting to spend more time here and

1:16

the story was he didn't like rectangular

1:19

square tables. He didn't like corners,

1:22

and so they wanted this massive round

1:24

table and they're like so

1:26

many other jobs. We did it, We got

1:28

it done. It was a nice table. Massively.

1:31

The Nobu job was finished six months

1:33

after Ellison bought the island. Chris

1:36

Andrews, one of Peter's employees, remembers

1:38

meeting Ellison for the first time during

1:40

its opening in late December of that year.

1:44

We're down there for the soft opening. At

1:47

one point I had to go to the rest of us, so I pushed my chair

1:49

back and bumped into someone. All I apologize,

1:52

is so sorry, And I turned around.

1:54

Here's a scrubby looking guy. Couldn't he believe

1:56

use their flannel shirt head shape?

2:00

He said, Oh, I'm Ellison And

2:02

I said, oh, Mr Ellison, Well we did these walls

2:04

were lynn I would workers. We

2:06

did your hostess stand. He shakes

2:09

my hand and says, we're going to do great work together.

2:11

January one. We had a distinction of

2:13

being the first company that he killed, the

2:16

first company he kills, but not the last,

2:19

and it would be a slow death. Ellison's

2:22

management company, Palama Nai, which

2:24

means to cherish Lenai, first

2:27

came to Peter with an ultimatum,

2:29

either he could sell his business to Polama

2:32

or vacate the building. When

2:34

Mr Ellison bought the island, they

2:36

came to me and said,

2:39

listen, we owned this building, we

2:41

want to use the building. You can work

2:43

for us, or you can go do something else. For

2:46

Peter, the choice was simple, keep

2:48

doing what he'd been doing for years. He

2:50

sold the business and worked for Ellison for another

2:53

six years. Then not of

2:55

nowhere again, Ellison's

2:57

company decided to shut down Lanai Woodworkers

3:00

entirely. Masamoto

3:03

called me into his office and,

3:06

as a surprise to me, called me into his office

3:08

and uh, well, me was closing a woodshop.

3:11

Kurt Matsumoto is the president of Ellison's

3:13

management company. After that, I asked her

3:15

if we could buy any the equipment, and

3:19

he told me no. He recommended

3:21

I leave the island, and I was kind

3:23

of shattered by that, kind of made

3:25

up my mind. Well, I guess I'm not leaving. The

3:28

problem for Peter is he might not

3:30

have a choice in the matter. Ellison

3:33

also owns the apartment where he lives,

3:36

and there's a stipulation in the billionaires

3:38

residential leases that if you work

3:40

for one of the landlords companies and are

3:42

fired. That's grounds to terminate

3:45

your lease. In other words, Ellison

3:47

could kick him out of his apartment at any

3:49

time. So you're holding your bronake.

3:52

It easily say, well, listen you, you don't work for

3:54

us anymore. You have the vacate. And

3:56

so it goes on an island owned by

3:58

a man who's so rich that

4:01

if he wanted to, he could afford

4:03

to buy Lennai three hundred

4:05

times over. Jobless

4:07

claims coming in, I mean really jumping from

4:10

the week before, pretty brutal. Three

4:12

point to a million records

4:14

six point six million Americans filed

4:16

for unemployment lost week. Indian

4:18

booking reminable, the worst impacted

4:21

by the pandemic. Well, now to the billionaire

4:24

boom. According to Bloomberg's supriocht

4:26

charters are up over three

4:28

hundred and a billionaire

4:31

was created every twenty six

4:33

hours during this condetic Larry Ellison

4:35

loves to go shopping for big things.

4:37

You bought a Hawaiian island recently.

4:40

No one not waiting in line for

4:42

a COVID test with the public roads.

4:45

It is time for a wealth tax

4:48

and America

4:53

welcome back to the paycheck I'm

4:55

Rebecca Greenfield. The

4:57

growth and wealth inequality around the world

5:00

in recent decades has been driven by

5:02

explosive wealth creation at

5:04

the very top. Before

5:06

the pandemic, billionaire wealth was

5:09

booming. The

5:11

top twenty richest people in the world held

5:13

as much wealth as half of humanity,

5:17

that's almost four billion people. Then

5:20

during the pandemic that gap got

5:23

much wider. Here's a bile Aghmed,

5:25

a strategist from ox MAM International.

5:28

This pandemic, we're witnessing the biggest

5:30

increase in billionaire wealth since

5:33

records began. In fact, billionaire

5:35

wealth has increased more during the pandemic

5:37

than it has in the fourteen years combined,

5:40

and a billionaire was created every

5:42

twenty six hours a year

5:44

into the pandemic. It only took ten

5:47

billionaires to get all the wealth held

5:49

by half of humanity. Wealth

5:52

isn't inherently bad, and a lot

5:54

of people argue that billionaires have benefited

5:57

society by innovating, creating

5:59

jaw new companies, and

6:02

they were in part incentivized to do

6:04

that by the prospect of getting very

6:06

wealthy. Many of them also

6:08

use their money to give back in ways that better

6:10

the world, by, for example, funding

6:12

research that creates things like vaccines.

6:15

But money is power, and increasingly

6:18

one group of people is accumulating so

6:20

much wealth that in some ways, it

6:22

can bend the world to its whims at

6:25

the expense of others. One

6:29

such billionaire is Larry Ellison. According

6:32

to Bloomberg's Billionaires Index, which tracks

6:35

billionaire wealth, he's worth around

6:37

ninety billion dollars depending on

6:39

the day. That's nearly double what

6:41

he had before the pandemic. Ellison

6:44

made his money as the co founder of Oracle,

6:47

a software company. He's part of

6:49

a new generation of scions, wealthier

6:52

and more powerful due to a soaring

6:54

stock market that has primarily

6:56

benefited American technology giants.

6:59

They have an unfathomable amount

7:01

of wealth to most people, even

7:04

probably themselves. Ellison

7:07

may be best known for how he spends

7:09

his money, mansions, yachts,

7:11

a tennis tournament, and buying

7:15

of the island of Lenai, the two Four

7:17

Seasons resorts there, around a third of

7:19

its housing stock, and practically all

7:21

the commercial properties. Plenty

7:24

of wealthy people own private islands,

7:26

but Lanai stands out. It's

7:28

home to around three thousand people, many

7:31

whose families have lived there for generations.

7:34

Overnight, when he first bought it back in Most

7:37

of those people got a new boss, or a

7:39

new landlord, or both. Now

7:43

they have a new neighbor. Like

7:46

many office workers stuck in their homes during

7:48

lockdowns, Ellison relocated

7:51

to one of his many properties on Lanai.

7:54

With the billionaire's attention focused on the

7:56

island now more than ever, residents

7:59

are anxious. None of them wants

8:01

to become the next Lanaii woodworkers.

8:05

Sophia Alexander, a reporter on Bloomberg's

8:07

Wealth Team, went to Hawaii to see

8:10

how things are playing out. There's

8:17

a reason people conjure images of

8:19

Hawaii's sandy beaches, sunny

8:21

blue skies, and rolling green

8:23

mountains when they think of paradise.

8:27

Lanai is no different. Approaching

8:30

the island on the ferry from Maui's Lahinah

8:32

Harbor, It's hills look buttery

8:34

soft. The Pacific water that

8:36

surrounds it is a deep blue, so

8:38

clear. In some parts you can see the ocean floor

8:41

and a ring of clouds hovering around the islands.

8:44

Mountain Peak is called Mount a Lay

8:46

because it looks like the island is wearing a lay

8:49

the Polynesian flower garland. It's

8:51

idyllic so it's easy

8:53

to see why someone would want to buy a Hawaiian

8:55

island if they could. We know that you've

8:58

made tons of headlines recently ying

9:00

in island in Hawaii, Lenna, buying

9:02

tons of homes. How many homes do you own right

9:04

now? Um,

9:07

well, let's see homes that I live

9:09

in? Or why do you buy the home if you

9:11

don't live in? Well, for example, I bought a home in Newport,

9:13

Rhode Island, which I'm converting into a nineteenth century

9:15

European art museum. Larry Ellison

9:18

didn't respond to my emails asking to talk

9:20

to him for this story, and his management

9:22

company didn't make any of its executives

9:25

available to me. We did find this one

9:27

interview he did on CNBC back

9:29

in two thousand twelve. Back then,

9:31

he said he wanted to make Lenai a sustainable

9:34

paradise and help local start

9:36

small businesses. He

9:38

also goes on and on about his plans

9:40

for his own art museums and his

9:42

desire as a kid to be a pilot,

9:45

which is why he now has his own planes

9:47

to fly. But Lenny

9:49

isn't just a mansion or a jet. It's

9:51

a community and one small decision

9:54

from Ellison can change everything.

9:57

It's like a real life version of SIMS, the

9:59

World Building video game. Now

10:02

a decade has passed and Ellison

10:04

and his company have changed a lot. On

10:06

the Nai Lanai woodworkers

10:09

closed, so did the family owned pokey

10:11

shop and the car rental business and

10:14

more recently the cafe down the street.

10:17

Most day. They were given no explanation

10:19

for their demise in and of itself.

10:21

When they buy this business or take

10:23

over this business doesn't seem much but

10:25

in totality that that

10:28

is a concern from an economic

10:30

standpoint, and just from the I think

10:33

from the perception residents have

10:36

of what they're doing on much control

10:38

they have. Was it a metaphorm

10:41

looking at is throwing a crab, you know, part

10:43

of cold water and turning on the stole and you

10:46

know, realize that they're being boiled

10:48

to death. That's Bochema, a

10:51

retired social worker who grew up on the island

10:53

and is one of the most vocal members of the community.

10:57

We're in Dole Park, the quasi

10:59

town square of Nay City, which

11:01

got its name from James Dole, who bought

11:03

the island in one

11:06

years ago. Dole decided to turn the

11:08

island into the world's largest pineapple

11:11

plantation. So yeah,

11:13

I mean the Pineapple dictated

11:15

how life went, you know here in our community.

11:18

And the old Pineapple, I

11:21

mean they basically took care of everything. They

11:24

ran the barge to and from Oahu. You

11:26

kind of ran the clinic, they ran

11:28

the hospital. I mean, you know, they

11:30

ran everything. So they had a lot

11:33

of control over

11:36

what happened in town. Butch grew up

11:38

on the island during plantation days, when

11:40

everything was regulated by the company. Whistles

11:44

marched the start of our work day and whistles

11:47

marked the a p m. Curfew. The control

11:49

over seemingly every aspect of life

11:52

and the dependence on the company for family's

11:54

well being created what locals

11:56

still referred to as a plantation mentality.

11:59

What's this in the plantation? Is

12:01

this idea that if you work for the plantation,

12:04

you don't speak out against them, and that

12:06

holds true no matter what to this

12:08

day. That's Solomon pele Halla

12:11

Halla, a seventh generation Lenian who

12:13

goes by Saul. He also grew up during

12:15

the plantation days. My parents

12:18

then, we're both the workers of

12:20

the pineapple plantation. My mother

12:23

was a pineapple picker and

12:25

my father became a heavy

12:27

equipment operator and a truck

12:29

driver irrigating the pineapple fields.

12:32

First all, there was one instance in particular

12:34

that crystallized the wealth gap between the Nays

12:37

residents and Lenie owners, a

12:39

divide that's only grown bigger With Ellison.

12:42

I took a part time job. In the evening,

12:44

I did bartending as our part

12:46

time, you know, And on

12:48

one day a group of people came in

12:51

to have lunch, and

12:53

they are unusual group of people because the women

12:55

had Mike strolls on and

12:58

I was serving their drinks. So

13:00

they were ordering martiniz for lunch. And

13:03

then when they were getting ready to leave after

13:05

their lunch, they were walking out with their

13:07

martini glasses and as

13:10

a bartender, I'd just said I better

13:12

go and retrieve the glasses. So I

13:14

started to walk out of the hotel

13:17

and then the manager saw me, and then

13:19

she stopped me and she says, where

13:21

are you going? And said, I'm going to go and

13:24

get the martini glasses

13:26

from those people that are

13:28

leaving, And then she's stopped

13:30

and she says, no, let them go. And

13:33

I said, why they're taking

13:35

our glasses and she says, these

13:38

are the board of directors for

13:41

the Doll company. Yeah,

13:45

that helped me to realize

13:48

that this plantation was

13:51

supporting the people

13:53

that we're having martini lunches. And

13:56

so I asked her, I said, so they're

13:58

leaving right now, Are they going

14:00

to go in into the pineapple fields

14:03

to thank my mother and my father for

14:06

what they do to give them

14:08

their flaunting wealth?

14:11

And she says, I don't think so, And

14:13

then I was crushed at that moment.

14:31

Doll closed its plantation after

14:34

its parent company was bought by a billionaire

14:36

named David Murdoch. Murdoch

14:39

is what locals now call a poor billionaire.

14:42

He was only worth a couple of billion dollars compared

14:44

to Ellison's roughly nine billion dollar

14:46

fortune. People told

14:49

me they remember Murdoch routinely complaining

14:51

about how much money he was losing from the island.

14:54

Ultimately, when he could no longer afford

14:57

to keep it running, he sold it to Ellison.

15:00

But Murdoch's impact on the island was enormous.

15:03

He's the one who built the two hotels and

15:06

oversaw the transition from pineapples to

15:08

tourism. The change wasn't

15:10

easy, and he tangled with many of Lenais

15:13

residents during his reign, often

15:15

getting into screaming matches with locals.

15:17

But unlike Ellison, people here told

15:20

me the island's previous owner was at least willing

15:22

to talk to them face to face. For

15:25

me, that is a

15:27

relationship, and that is one that

15:30

allows us to interact whether we agree

15:33

or disagree. I've had

15:35

that relationship with with Murdoch because

15:37

when he was wrong, when he had no idea

15:39

about it, I wouldn't hesitate to him,

15:42

and he would always tell me, you know, you're

15:44

a thorn in my side, you know, And

15:46

I took that as a compliment. Now

15:50

with Ellison, it's a completely different

15:52

story. Solve remembers

15:54

approaching the president of Ellison's company

15:57

to ask for a meeting with the new owner. I

15:59

say, Kurt, I would like to request

16:02

a meeting with Ellison in

16:04

person. Kurt's response

16:07

to me, and I'll never

16:09

forget this, He says,

16:12

I don't mean to be disrespectful, but

16:15

that is not Ellison's style. Those

16:17

are the exact words they've been ingrained

16:20

in me from that very moment. And my

16:22

response to Kurt was, first

16:24

of all, that is disrespectful,

16:27

But beyond that,

16:30

I still have an expectation that

16:33

we need to sit down and meet, you know,

16:35

and so I make my requests.

16:39

So I've been waiting now for ten

16:41

years to have a conversation, just

16:44

to get to meet this person

16:47

who somehow this mystic and

16:50

this mover and shaker in a community

16:52

of which we don't get to see you or no, and

16:54

my requests have never been acknowledged

16:57

or responded to. I also

17:00

to speak with Kurt Matsumoto, the president

17:02

of Ellison's management company, but

17:04

he didn't respond to my emails. A

17:08

spokesperson for Poulama did suggest

17:10

I talked to Diane Presa, who acts

17:12

as a liaison between the company and the

17:14

community. She didn't seem

17:16

to want to talk much about Ellison's plans,

17:19

but she was the only person from Ellison's company

17:22

who agreed to be interviewed. So I

17:24

had to ask, do you feel

17:26

like you have a broad sense of what the plans

17:28

Polama has for the community? Are?

17:31

You know? Things change at Puloma all the time. So

17:34

I hate to say something and then it

17:36

doesn't happen, you know, I guess

17:38

like long term plans, you know, um

17:44

I would say no, while

17:48

the uncertainty is scary for people

17:50

like Saul and Butch, who have lived

17:52

on l Nay for decades. There's

17:54

more at stake for the younger generation that

17:56

worries about its future here on the island. Take

17:59

Michelle Fuji, a thirty eight year

18:01

old high school math teacher who grew up

18:03

here and is raising her two kids here. She

18:06

loves lenai An enthusiastically

18:08

offered to drive me around to show me her

18:10

favorite parts of the island. Like pretty

18:12

much everyone else here, her speedometer rarely

18:15

topped, and

18:17

it seems like she waved at every passing car

18:19

and person. Let's see if Auntie

18:21

wants to ride because she's walking to the rain.

18:24

Sorry, that's Auntie.

18:28

You like when ride it is raining?

18:31

You sure? Okay, you go girl

18:34

with your exercise. Everyone

18:37

seems to know everyone here. People

18:39

refer to their elders as aunties and

18:41

uncles. I routinely saw people

18:43

hugging. A stranger even invited

18:45

me to his kid's birthday party on the beach. Ellison

18:48

is not part of any of that, and

18:51

it doesn't go unnoticed. I

18:53

think a big difference between Murdoch

18:56

and Allison is is just the connection to

18:58

the community. Like I and

19:00

and I maybe it's like, you know how there's like

19:02

the five love languages and what is your

19:04

best like love language UM,

19:07

And so maybe Murdoch was

19:09

like words of affirmation or service,

19:12

you know, where he would actually come out UM

19:15

or quality time and spend time with the

19:17

community members, like people knew him by

19:19

like first name, and you know, whenever

19:22

he would come home, like sure there's still that plantation

19:24

boss mentality and everybody

19:27

bowed down and you know, praise

19:29

you. But at the same time, it's like people

19:31

knew who he was. When you've seen his face,

19:33

you would recognize him and he would greet

19:35

you. Ellison is a little

19:38

bit different. I've never met him.

19:40

Without any insight from Ellison, that

19:42

leaves Michelle to fill in the blanks about

19:44

how his company's plans will affect her

19:46

life. I don't think that I'm

19:49

fully Like

19:51

if I had to put my money on whether or

19:53

not Poulama is

19:56

solely in it for the

19:59

best interest of our community, I

20:01

would not put my whole fortune on

20:03

it, you know what I mean. Since the pandemic

20:06

started, more rich people seem to

20:08

be moving to the island. Michelle

20:10

is worried about the community becoming more divided

20:13

economically. One of

20:15

my biggest fears is that the people

20:17

of this community will sort of be

20:19

the ones that would

20:22

be caring for the elite rich

20:24

that can't afford to actually live here one day,

20:26

and that's our sole purpose. Like

20:29

as an educator, you would think that we

20:32

would want our students

20:35

to graduate and aspire to be more

20:38

than just somebody's servant. Michelle

20:45

and her fiance have three kids between

20:47

the two of them and are excited about getting

20:50

married, but she says it's getting impossible

20:52

to find housing, especially after

20:54

Ellison moved to the island and the pace

20:57

of his construction projects have picked

20:59

up. All those

21:01

projects need people to build them,

21:03

which means more construction workers living

21:06

on the island taking up the already

21:08

limited housing options. There's

21:10

no houses. Really, isn't

21:12

any homes

21:15

that we could affordably

21:18

rent, you know, Like I think now, if we

21:20

were to try and find the house that was being

21:22

rented by some local family, we would be paying

21:25

like two dollars a month, because

21:27

that's what construction workers would pay,

21:29

or that's what you know, the market would

21:31

allow for. To alleviate

21:33

the housing crunch, Ellison is building

21:35

more homes on the island. The plan

21:38

initially had units for sale, but

21:40

something changed and now they're all

21:42

only for rent. At first, Michelle

21:45

was against the project because of the change

21:47

and the fact that the units will all be fully

21:49

furnished, making it feel like they're

21:51

for outsiders moving to the island temporarily.

21:55

But with her wedding coming up, she's desperate

21:58

for options. That where

22:00

my sway changed, you know, Like

22:02

then it's like, okay, well, if we're thinking about

22:04

the future as a married couple and

22:06

we're not able to live together unless

22:09

we you know, I don't want to

22:11

say sell out because it's not really selling out

22:13

because we're not really selling anything, but it

22:16

definitely changed my perspective

22:18

of things versus it just being like,

22:22

you know, we gotta think about ways that we're going to merge

22:24

our family, and that

22:26

right now would be a solution. Younger

22:31

families like Michelle's have been moving

22:33

off the island recently. Michelle

22:35

said she worries that if she did leave and

22:38

gave up her housing and her job, then

22:40

there'd be no way for her or her kids to return

22:43

because everything is becoming so expensive

22:47

and there are so few employment opportunities

22:50

outside of working for the billionaire around

22:53

the world. As the rich get richer and

22:55

decided to move into your neighborhood, changing

22:58

it to fit their tastes. People

23:00

often throw around the word gentrification,

23:04

but on the night it goes beyond that,

23:06

because it ultimately comes down to the tastes

23:09

of one person who increasingly

23:11

dictates who and what is

23:13

allowed on his island. And in this

23:15

version of gentrification, you're not

23:18

pushed further from the city center. You're

23:20

pushed into the ocean, and who

23:22

knows if you can come back. When

23:34

I first started reporting on this season of The

23:37

Paycheck, an economist named Gabriel

23:39

Zuckman told me something that's stuck

23:41

with me. He said, if

23:43

you think about it, extreme wealth inequality

23:47

is inefficient. To

23:49

someone like Larry Ellison, an extra

23:52

billion dollars doesn't change

23:54

his life that much, but

23:56

that amount of money for the thousands of people

23:59

on the island, it would drastically

24:01

change their lives. When you own

24:04

a hundred billion dollars, it's just useless.

24:06

It's not changing their lifestyle. It

24:10

has no meaning. And

24:12

whereas an extrat billion, you know that that could

24:14

be I don't know, paid in taxes

24:17

spent on education and

24:20

healthcare, on infrastructure that

24:23

that is valuable. Next

24:25

week on the Paycheck. We had to a place

24:27

where the government's decisions about

24:30

how to manage the pandemic had

24:32

unintended consequences for women.

24:35

I mean, as public had professionals.

24:37

We must do better. We have

24:39

to educate people. We had to educate

24:42

communities, We had to educate

24:44

po data. It will be a mainting if

24:46

we can help them to work together

24:48

with the physicians, for

24:51

them to learn more and to be working

24:53

together. Thanks for listening

24:55

to The Paycheck. If you like our show,

24:57

please head on over to Apple Podcasts

24:59

or ever you listen to podcasts and

25:01

rate a review and subscribe. This

25:04

episode was hosted by me Rebecca

25:06

Greenfield and reported by Sophie

25:08

Alexander. It was edited by

25:10

Shelley Banjo with help from Francesca

25:12

Levi, Janet Paskin Rocksheeta

25:15

Soluja, and me. We also

25:17

had editing help from Daniel Balby, Kristin

25:20

B. Brown, Gildaa, Carly, Nicole

25:22

Flato, Melissa McDonald, and

25:24

Kai Schultz. This

25:26

episode was produced by Gildaa, Carly and

25:29

sound engineered by Matt kim

25:31

Our. Original music is by Leo Sidron. Special

25:34

thanks to Magnus Hendrickson, Mckinnonda

25:36

Keeper, Margaret Sutherland, Stacy

25:39

Wong, and Aisha Diello. Francesca

25:41

Levy is Bloomberg's head of podcasts. See

25:44

you next week.