DAN THOMASSON: Who can afford $12.5 million log cabin?
This isn’t your great-great-grandfather’s log cabin. That’s the thought I had the other day when I picked up The Wall Street Journal’s Friday section called “Mansion” that featured a 7,000-square-foot version of what my ancestor and Daniel Boone built in Kentucky more than 200 years ago. The difference, of course, was those were mainly one-room with a dirt floor and didn’t cost $12.5 million.
Should you have any doubts that Americans aren’t quite as bad off as they may want to believe, I suggest you go out to your newsstand and pick up a Journal Friday and check out the section just mentioned. Your perspective might change dramatically. But if you are like most of us who still think a million is a lot of money, your sensibilities might just be offended.
The weekly feature displays page after page of eye-popping advertisements and features of multimillion-dollar residences that make one believe, as humorist Will Rogers said, that America ultimately would ride to the poor house in a limousine. One time I actually found a house under $1 million, and I’m sure there have been a few more, but the average has to be above $3 million.
That is particularly so when a large display listing on one page, including pertinent information like “sitting on an acre within walking distance of the (Los Angeles) strip,” was a mere $28.8 million, and the other two featured on the page were $22 million and $19.5 million, the latter on Long Island that works out to a cool $1 million an acre for the 19 acres of the estate. That same page announced an auction for two properties in Aspen, Colo., with minimum opening bids of $17.5 million and $15 million.
The first thing I asked myself: Who buys these monsters and then sells them only a couple of years later in many cases? Who has $12.5 million to sink in a house? That’s a sum that would permit any frugal person, even at today’s low interest rates, to live out one’s life in comfort without doing anything much.
But then I discovered at least a partial answer. I picked up The New York Times and discovered a list of the 200 chief executive officers with the top incomes in the nation for last year. They ranged from $96 million to $11 million. None of these guys would have any problem buying any of the properties in the “Mansion” section. In fact, some of them probably have.
These are public-company CEOs. The Times doesn’t list the incomes or fortunes of private-company owners and executives. Forbes Magazine is the place to go for that information.
Just as shocking as the considerable increase in pay of most of those listed is another compilation by the newspaper that cites the 10 executives with the largest exit packages. You know, the so-called golden-parachute boys who, for one reason or another, have decided to leave their companies. That range is $155 million to $23.6 million, from James Mulva of ConocoPhillips Oil to Lynn Eisenhans of Sunoco.
Am I jealous? You bet I am. Most of us are lucky to walk away with a two-bit watch and enough of a monthly pension to take the spouse out to dinner every two weeks. That is, if your company hasn’t abandoned its pension like so many.
Huge fortunes always have been made on real estate, but it was the air out of the housing-market balloon that brought about the great recession, vestiges of which are still lingering. But these men and women, far fewer of them than their male counterparts, with often more dollars than sense, as my clever grandmother liked to say, have survived quite nicely, even though their companies may not have.
Oh, well. It is pleasant to look at the opulence available if one could win the lottery. That is, if there is enough left over from the winnings after settling for half the announced pot and paying taxes to buy one of the smaller places, say a million or so. There’s even a possibility that a two-room log cabin might be available.
It probably would have to be located up some holler in Appalachia, however.