The 0.01 Percent
The last few years have seen a lot of discussion about income inequality in the U.S. We all recall that brave band of "Occupy" protesters and campers that lasted longer into the fall and winter than their quarry on Wall Street thought they would. They and others (including President Obama, our very own Bernie Sanders, and a certain Nobel laureate who writes for the New York Times) keep drawing our attention to the Uber rich in this country, the so-called one percenters. Apparently, this select group owns something like 35 percent of the country’s wealth, and this remarkable rising tide just seems to float a few yachts, not all boats.
Well, it turns out that there are some very wealthy people in developing countries, too, and many of them seem to want to flaunt their wealth by riding expensive motorcycles. Following the scent of money, major bike manufacturers are flocking to these places, including our own Harley Davidson.
India, with its enormous population of 1.3 billion people, is a prime example. According to a recent estimate from Credit Suisse, there are 182,000 millionaires in India. So lemme see ... that means that 0.014 percent of Indians have a million dollars or more -- sometimes much more -- to throw at monuments to themselves. There’s the guy who decided to build a 24-story house that can be seen for miles. He’s making sure that his dinner guests don’t need a GPS to get there before the hors d’oeuvres are gone. "Anoop’s place? Easy. You see that tower over there? What? Oh, yes, he has a very fast elevator!"
So he, and many others like him are choosing to ride fancy motorcycles. If Anoop wants to look like Arnold in the first Terminator movie, he can get a Harley Fat Boy for 40 percent more than we pay here, but who cares, he’s in the 0.01 percent.
Harley now has four dealerships in India, and I’m sure there will be more. The U.K.’s Triumph motorcycles have been there for several months now, and a well-heeled Indian can spend more than $32,000 to ride one. This figure, by the way, is some 20 times what the average Indian makes in a year. BMW is there, and America’s oldest motorcycle company (vibrantly reborn just a few years ago) also wants to be in on the game. Indian motorcycles says it’s going to sell the Chief for about $33,000, not a lot more than it goes for here. There are not expected to be any PC issues with brand names in India - after all, everyone there is an Indian. But only 0.014 percent are chiefs.
So what’s going on here? Why is everyone tripping over themselves to get into the markets of the large, developing countries like India, Brazil, and China? Answer (of course): Lots of people, many of whom are getting rich. And, if you’re a newly minted millionaire, on the move and away from your trophy palace, trophy garage, trophy everything, you can make sure that the rest of the citizenry knows you’ve hit the jackpot if you’re driving a Mercedes or riding a glistening, chrome-bedecked Harley. You can even study your successful reflection because you have someone to shine the bike’s chrome.
But there’s also another issue at play for these companies. There are a few marquee brands that are still selling well in the U.S. (Harley Davidson, BMW, KTM, and Ducati). But the U.S. is slipping as the leading motorcycle consuming country in the world. Fewer of us are riding, and those who are seem to be getting a little long in the tooth. How to grow your marketshare then? Head for the developing world. After all, a country like India has produced 24,000 new millionaires in the last two years. At least some of them will sign on for a big V-twin with that characteristic rumble. The Monsoon Palace garage has a lot of room in it.
So why do the Uber rich always need the most and best stuff? In a recent NY Times article on the new economic powerhouse, South Korea, one citizen didn’t mind the flashy toys his neighbors made sure everyone saw. Instead, he wondered what was wrong with him for not having the same things. It’s a reminder to those of us old enough to remember such things that the Smiths really do feel that they have to keep up with the Jones, as do the Parks with the Kims.
So what do you get with your expensive goods? A rich and fulfilling life? All the research says no. Money and fancy stuff does not equate with longterm happiness. You may get a three month happiness "bump" when you drive your new Porshe Boxter into your 12-car garage, but after that, it’s back to baseline.
As an evolutionary biologist, I am inclined to think that our brains haven’t gotten a lot better since those good old days in the cave. Ork and his family ate as much of the mastodon as they could, and most of us still do. And when Ork got the paleolithic equivalents of a Viking range and a Subzero refrigerator, he had more wives than he could manage, just as our monied illuminati do today. We’ve come a long way, baby.
Bob Engel lives in Marlboro with his motorcycles, wife, and cat.