Where the Money Is
In Los Angeles, almost all the skyscrapers bear the names of corporations that handle money: banks, accounting firms, insurance companies. This seems right. These organizations, one reckons, ought to have lots of money because, well, they have lots of money, even if it’s mostly other people’s money. Once you get past the fact that these super-rich cartels construct their towering edifices with wealth created almost magically, alchemically, accumulated either by selling our money back to us at prices hundreds-of-percent above what they pay for it (banking), pooling our money and amortizing the risk while skimming off the vigorish like an old-timer bookie (insurance), or counting it in creative ways (accounting), these enormously profitable concerns announce their spectacular success with tangible evidence poking into the clouds Their wealth is real. They have real estate to prove it.
Depending on your politics and sense of history, the fact that financial firms dominate your downtown skyline is either a testament to the elegance of capitalism or a dismally ironic commentary on our collective capacity to be bamboozled by so many Harold Hills in pinstriped suits.
No, they’re not selling us trombones and band uniforms. But like the Music Man they are selling happy illusions, and as the world’s most successful religions have amply demonstrated, charging premium prices for imaginary products tends to be a splendid business.
Money is a mythical concept, a theory that almost all of us agree to. Just as art transforms a rectangle of painted muslin into something of perceived value, printing numbers and presidential busts on paper makes those (smaller) rectangles of paper suddenly worth a lot more than if they were merely used to jot down someone’s phone message. It’s a $5 bill because we understand the theory behind money. An authentic Jackson Pollock is worth more than an expertly forged Pollock because we understand the theory behind art. Money exists only because we agree that it does. Likewise, the financial corporations that own the tallest buildings exists because we agree that we need them to referee the game of capitalism.
The rich corporations that handle money certainly provide a service, the importance of which is reflected in their jillion-dollar towers. Like the gaudy casinos that line Las Vegas Boulevard — in a city that functions like a colony of hyperactive banks, insurers, and accountancies — the companies that own the prime properties near your civic center got rich by merely handling money. They produce nothing other than monthly statements. They create nothing other than new financial “instruments” for folks to bet on. They don’t really do anything other than pass the money back and forth, bleeding off a few cents with each transaction, like a slot machine. But we seem to need them to preserve and enhance our way of life. How can one buy homes and cars and other expensive stuff without loans and collision coverage and someone to keep track of how much we’re winning and losing?
The miraculous part is the transformation: at some point, the firms that have nothing but fingers on everyone else’s wealth eventually have everyone else’s wealth in their pocket, collected and stacked neatly in their 72-story monuments to entrepreneurship.
It’s a pretty cool trick.