Sometimes truth is actually harder to believe than fiction. This story is one of them.
In 1973, 16-year-old oil heir John Paul Getty III (JP 3), was kidnapped by the mafia in Rome. His billionaire grandfather, John Paul Getty Sr (JP 1), refused to pay the ransom for his return.
Correction, JP 1 wasn’t just any billionaire. Fortune magazine pegged him as ‘The Richest Man in the World’ in 1957, and the Guinness Book of Records doubled down in 1966 with the title of ‘Richest Private Citizen’.
Photo by Giles Keyte
JP 1 told the press, “if I pay one penny now, I’ll have 14 kidnapped grandchildren.” Even so, we’re talking about pocket change here. The asking amount was US$17 million (approximately US$98 million today.)
At the same time, thanks to the oil crisis of 1973, those very same six months JP 3 was held hostage (July 10 – December 15), JP 1 was making obscene daily profits akin to the entire ransom sum.
He could have had all of his 14 grandchildren kidnapped 11 times consecutively in those 157 days, and paid it off with the bonus profits he was taking in alone. Leaving his existing billion-dollar fortune completely unscathed.
For us everyday plebs, the mind boggles to think that granddaddy Scrooge wouldn’t cough up the cash, despite the 80-something edging closer to his last days on Earth. And we’re not alone. Director Ridley Scott and screenwriter David Scarpa had their own crack at the Shakespearean tragedy in 2017’s All The Money In The World.
Eventually, after receiving JP 3’s severed ear in the mail, the magnate haggled the ransom down from US$17 million to US$3 million. In the end, he only paid $2.2 million from his own pocket, which was the maximum amount his accountants could declare as tax-deductible. He loaned his son John Paul Getty II (JP 2) the rest, at a ruthless 4 percent interest compounded annually.
JP 3 was eventually released; earless, and traumatised. When JP 1 died in 1976, he left JP 2 $500, and JP 3 nada. To the rest of us, he endowed the J. Paul Getty Museum in Los Angeles.
How do you even start to unpack this unfathomable level of cheap?
All the money in the world and no sense?
It’s important to differentiate the man from the money, and more importantly, the man from his story about the money. Because we all have a story about money. We carry it with us everywhere we go.
To some of us, money represents security, love, freedom, access to healthcare, the ability to splurge on nice things, power, respect, and for most – the opportunity to live a life more comfortable than the one we were born into.
But in many ways, money is a completely intangible illusion; numbers on a screen, or rapidly depreciating assets. Which is perhaps precisely what makes every tragic figure who falls prey to its power so sad. The way it can both simultaneously free us and rule us is a tale as old as time.
It’s not correct to assume JP 1 didn’t love JP 3, it’s just that he loved his money more. The push and pull between his money and his heartstrings was a common theme throughout his life. Despite his eye for art, critics noted his renowned collection was limited because he never wanted to overpay to purchase art and, more importantly, he bloody loved a bargain.
He may have loved JP 3 so much that he was teaching him to survive on his own, like the tough love dished out by other similarly mega-rich parents. Except it massively backfired. JP 3 was haunted for the rest of his life and spiralled into drug and alcohol abuse. Leading eventually to a stroke, disability and early death.
Yet what’s all the money in the world worth if you can’t use it to express love, appreciate life, or experience happiness?
How much money is enough money?
JP 1 used his fortune to make him feel safe and secure. But money is not static, nor necessarily liquid. As his wealth increased, so did his goalposts for what he considered to be safe.
This is pretty relatable, no matter how many zeroes might be in your account. Most of us have a ‘magic number’ we believe will make us feel secure. The trouble is, what happens when you catch up to your number?
As per Maslow’s hierarchy, we don’t need a whole lot to have our basic needs of survival met; food, water, warmth, rest, security and safety. Hence the trend of CEO’s across the U.S. rolling out the ‘minimum income experiment,’ slashing their own salaries to ensure their employees can have their basic needs met.
Beyond a base level, some people fair better feeling satisfied with the wealth they amass. They consider anything above ‘basic’ a delightful bonus. Just by sharing his salary around, Gravity Payments’ CEO Dan Price noted his “life has gotten richer for it.”
Some mega-rich who have been around the block have lived the experience of splurging and failing to find happiness with it. So instead of being stingy with appreciating assets, they just become really careful about depreciating assets. Their money is kept hidden away, and to the rest of the world, that can look cheap.
But here’s where it gets tricky. We’re just using our own stories about money to judge each other’s conclusions about money. What some people call frugal and cheap, others define as smart budgeting, being well prepared, and making considered choices and investments.
And for many multi-millionaires, it’s precisely these cheap characteristics and attitudes which created their wealth in the first place. Did they become rich because they were frugal?
Chicken or the egg?
If not for family connections, or sheer luck, you clearly need a certain amount of hubris, drive, and work ethic to amass a certain amount of cash – but then what happens? The outcome is based on your life history and your mindset.
Growth mindset:
This is the billionaire who realises there is no fixed limit to what they can earn. Ironically, it can be their overspending and lavish lifestyles that enable the very connections and networks that allow them to perpetuate more and more money.
Scarcity mindset:
The billionaire who is endlessly trying to protect every last cent they have earned, at all costs. Often because this is the type of thinking that got them to be able to hold so many assets in the first place.
Paul Piff, a doctoral candidate in social and personality psychology at UC Berkeley, has concluded, “the more money a person makes or has, the less generous, helpful, compassionate, and charitable he is toward other people.” Case in point for cold hard JP 1.
But many who inherit their wealth, use the realisation that they never earned it themselves to drive generous spending and philanthropy, which they hope can buy them the validation and respect they crave of their peers.
Author and entrepreneur Tim Ferriss (of 4-hour work week fame) has not only amassed his own financial success but studied many billionaires in his #1 NYT bestseller, Tools Of Titans.
He told Business Insider, money doesn’t change you, but rather “fame, power, money, and alcohol just make you more of who you already are.”
“If you’re neurotic, add 100 million to that, you’ll be super neurotic!” If you’re generous, add 100 million to that, you’ll be even more generous.
So it all comes down to who you are and what you value before you get your filthy mitts on the money.
Balancing an age-old dilemma
Firstly, we all handle money and we all have a perception of it no matter how much your net worth. Being able to master your main motivators and drivers is going to keep you in control of your cash, and not have it control you.
Secondly, how the mega-rich spend their cash, or not, actually affects you. A lot. In a release by the Fidelity Institutional Wealth Services, a “millionaires’ outlook is a leading indicator of the direction of the economy.”
We are all susceptible to the ebbs and flows of the market, regardless of your penny-pinching or how many times you splash out and cop another avocado on toast brunch.
Let the incredible legacy of the Getty’s and the curse that surrounds them serve up a good lesson: know when to haggle, but never lose yourself and the things you love to that almighty dollar.
RELATED: How Does Red Bull Make Money?
