Grubstakers - Episode 179: Bernard Arnault (Part 1)

Episode Date: July 24, 2020

This week we tackle the richest man in Europe, and briefly this year, the richest man in the world, luxury megabillionaire Bernard Arnault. We investigate his privileged upbringing, the sketchy background of the company he built his wealth on, and speculate on his relationship with Alligator mississippiensis. Part 2 will be available later this week on https://www.patreon.com/grubstakers. Rest in power Michael Brooks.

It's the kind of thing that makes the average citizen puke. I look at this system and say, yeah, you know, what's going on? I don't know anything about this man except I've read bad stuff about him. And I don't like, you know, I don't like what I read about him. We are more than just one coin. We create the world around this coin. Cop. Invention. Cop. Cop.

In 5, 4, 3, 2. The evil has gone. Hello and welcome back to Grubstakers, the podcast about billionaires. Thank you for being here with us today. My name is Sean P. McCarthy and I'm joined by all of my co-hosts. Andy Palmer. Steve Jeffers. Yogi Poliwal.

And this week we've got a big episode. We've got a big topic. We're talking about currently the third richest man on earth. The richest man in Europe. We're talking about currently the third richest man on earth, the richest man in Europe. We're talking about French billionaire Bernard Arnault. And you may or may not be aware of a company called LVMH. It stands for Louis Vuitton Moet Hennessy. It's a massive luxury conglomerate. It's got over 75 different brands under it. As of July 22, 2020, it has a stock market cap of $237.08 billion. Bernard Arnault, according to Forbes, as of July 2020, is worth

$113.2 billion. So he's on an entirely different scale compared to the billionaires we typically talk about. This guy is a mega billionaire. He's on the Jeff Bezos level. Bill Gates are the only two who are ahead of him. He's richer than Warren Buffett. So this is an extremely influential, powerful person who I think a lot of particularly Americans are probably not familiar with going into this episode. He's very private. He enjoys his privacy. And a part of that is, is a France has been known to cut the heads off the people that own the country. And,

uh, Bernard Arnault should be rightfully afraid. Uh, the man certainly is an oligarch in his nation. It's, it's interesting too, because a lot of his wealth comes from other wealthy people paying, uh,

tribute to him to display their own wealth. Right, right. But Yogi is right. It is like how, you know, chameleons will develop particular camouflage that's like with the trees that they typically live in. So if you're a billionaire in France, you like develop the keep your head down camouflage.

You like, you learn to hide the length of your neck so that people can't measure it out for the guillotine. Keep your head down, keep your head on. Protect your neck. We mention sometimes that these billionaires own several countries, but we rarely mention all of them. And so I'm going to do my best to mention as many as I can. Louis Vuitton, Moet, Hennessy.

They got Wines and Spirit Lines, Clos de Lambre, Chateau de Quim, Dom Perignon, Ruin It, Moet and Chandon, Hennessy. They got Wines and Spirit Lines, Clos de Lambre, Chateau de Quim, Dom Perignon, Ruinette, Moet, and Chandon, Hennessy, Vaux of Clicquot, Ardègue, Chateau Cheval, Blanc, Glan Moranger, Cape Mantel, Chandon, California, Chandon, Brazil, Newton Vineyard, Cloudy Bay, Chandon, Australia, Belvedere, Terraras, Delos Andes, Bodega Numantis, Cheval des Andes, Woodinville, Shandong, China, Aeon, Shandong, India, Clos 19, and Vulcan D.M.E. Terra. And that's just the wines and liquor lines.

The fashion and leather goods companies are Berluti, Celine, Christian Dior, Emilio, Pucci, Fendi, Fenti, Givenchy, Kenzo, Lowe, Loro Piana, Louis Vuitton, Marc Jacobs, Moniat, Nicholas Kirkwood, Patois, Pink Shirtmaker, Rimo Wad, The Perfume and Cosmetic Lens, Aqua D, Parma, Benefit, Cosmetics, Chaling, Fenti, Beauty by Rihanna, Fresh, Givenchy Parfums, Garland C, Kenzo Parfums, KBD, Vegan, Beauty, Chaling, Fenty Beauty by Rihanna, Fresh, G1 Sheeper Parfums, Gorlency, Kenzo Parfums, KBD Vegan, Beauty, Maison, Frances, Kirkjohn, I'm almost done, Makeup Forever, Marc Jacobs, Beauty Parfums, Cushion Duo Parfums, Lowe, The Watches, and Jewelry Lines, Bulgari, Chamo, Fred, Hublot, Tags, Uhur, and Zena. And he owns portions of many other businesses with an eye to purchase the brand Tiffany's, the blue box company, ladies and gentlemen. We got four more minutes if you want to make up some companies.

He owns the French restaurant company, Escargot. He owns the French airlines, Oui Oui, Pigeon Fly Fly. Oh, man. Oui, oui, pigeon, fly, fly. Oui, oui, work. Pepe Le Pew and Ors de Vores, I can't take it anymore. He owns the Pink Panther, Inspector. Chaco, yuck. The man owns way too much shit.

And the reason he does is because he's clearly a hoarder, ladies and gentlemen. This is a mental disorder that he has exploited to the nth degree i just want to say for the record i would have pronounced all of those company names correctly and i've been naming them instead of yogi he would have messed up rihanna but the rest he would have gotten pretty good it is true like he owns and you know so yog through, again, 75 different luxury goods companies, but he owns the majority stake in Rihanna's company, Fenty. She owns like 50% of her beauty company. He is the one getting the majority of money off it. And like Yogi said, in 2019, he bought Tiffany & Co., the jewelry company, for $16.2 billion. I mean, this is like such a worldwide scale. He owns over 4,650 retail stores throughout the world with all of these different products.

And again, you just, almost any luxury company you can think of, this guy owns. He's LVMH, LVMH is the largest luxury goods company in the entire world. He also is connected to several cruise lines and hotels as well. I mean, these are the companies where he has a majority control. But, you know, everything I've just mentioned is connected to the rich elite. They dress, as Andy said, in homage to this person when they try and dress nice. And just to talk very briefly about the scale of his wealth, to try and conceptualize it, because I think it's hard to get your mind around

just a person being this rich compared to everyone else on Earth. Just from the World Socialist website, in 2019, Bernard Arnault's income in 2019 was so large that on average, his wealth grew by 1.23 billion u.s dollars every week uh assuming he slept an average of eight hours he went to bed every night and woke up 58 million dollars richer so he makes 58 million dollars every time he goes to sleep and wakes up in the morning

his wealth grew by two thousand dollars every second jeez louise so you you work two weeks for two grand this guy or you know a month or however long it takes you this guy makes it every single fucking second he's one of those guys where he's so rich that his if you trace his net worth especially like over the period of covet it will go up and down by like three billion or uh ten billion like over the course of weeks yeah just depending which is is a very like it goes beyond you know our our regular uh the your regular loser one billionaire where you know he he absorbs and rejects several of those idiots just in a very short period of time. And it doesn't really, I mean, maybe it affects him emotionally, but it doesn't really have any major effect on his life. It's just kind of a marker of how insanely wealthy he is.

Yeah, right. He is so wealthy that he killed Carl Sagan so that nobody would be able to describe the scale of his wealth. Nobody would be adequately able to conjure metaphors that describe how wealthy he is. The size of his wealth goes on for eons and

eons of eternity and light years. He'd relate his wealth to like Sagittarius A or something, or, like, a black hole or something. His wealth is like if you stand on the beach, every single grain of sand is one dream that he has crushed throughout his life. If you consider the GDP of Tajikistan, Kosovo, or Somalia, a bad day for Bernard Arnault is losing that much money.

Billions of billions of dollars being lost and gained on luxury goods that truly nobody needs when you really think about it. Sorry to break the impression there, but the reality is this man makes his money off a luxury good that is only as valuable as the brand itself hell grubstakers loc is worth trillions of dollars if you consider what our brand identity is worth to ourselves oh yeah notionally sure yeah but our brand uh value goes down every time i post on twitter so sorry about that but you know just because of the scale of the wealth again third richest guy on earth we're gonna need multiple parts to tell the story we're gonna do this first part here on the free side we will continue on the patreon but we will with the time we have run through as much of his

biography as we can then we will continue it on the patreon and we will also kind of continue some of the scandals we can't get to today. Because that's the fucking thing. Like, we're talking about 75 different luxury brand and good companies. You know, each of those has their own scandal. We can't talk about every bad thing this guy has done, but we'll try to get to the hits. And I guess, you know, just to like kind of give you an overview of some of the things that this guy is responsible for. Well, of course, you know, labor abuse throughout the entire supply chain, like anybody else who's involved in the fashion industry or making perfumes or whatever else. We will talk a fair bit about labor abuse.

We'll talk about animal cruelty is, I think, a very horrific aspect of his business empire. Environmental damage. Interestingly enough, the Notre Dame Cathedral in France, you might remember the fire there, aspect of his business empire environmental damage um interestingly enough the notre dame cathedral in france you might remember the fire there as a publicity stunt he pledged 200 million euros to rebuilding it and has only given 10 million euros uh so one advantage of owning the media is that you can just have them put what you pledge to give in big bold letters and then not mention what you actually give later on. Of course. In terms of fraction of net worth,

I probably contributed more to the Catholic Church by watching Young Pope. We'll talk a bit about kind of what he's been doing with the coronavirus crisis. We'll talk about his government connections, tax evasion. He's a major tax evader. And, you know, and also kind of a follow up from a previous episode we did on Joe Lowe and the Malaysian State Bank, one state fund, the 1MDB fund, which they robbed the Malaysian state blind. For some reason, Bernard Arnault was sitting on the board of 1mdb and he was apparently sitting there at the personal invitation of joe lowe um he claims that this court case is ongoing

but he claims he actually never attended a board meeting but kind of weird that he would go and agree to sit on the board of this extremely fraudulent uh multi-billion dollar theft to be fair i heard from an article that he was only sitting on that board because he had a bad back. He just happened to be there and was like, I need a chair. And they went, yeah, you can sit here. We cannot cover every scandal

that LVMH is a part of, but for $5,000 a month or a flat fee of $250,000, we can be stopped. It's true. Bernard, we will release one episode every week until our demands are met. We will cover one new scandal for the next 10 years until we get to every one or you pay us a quarter of a million dollars. We know where the bodies are hidden, Bernard.

We know where you buried those French bodies. I mean, for Uncle Bernard here, I think we should probably boost it up to maybe $20,000. I think so. I think a total of a cool $2 million flat fee, if not $20,000 a month.

He'll pledge $20,000, and that's how he'd get $2,500 or something. Right. So based on the Notre Dame Cathedral, we have to ask for 10 times more than what we actually would need or 20 times more. But I think like the main thesis of this episode is the fact that this guy, like what we would say about this guy is he's really someone who's introduced, let's say, American business or American neoliberalism. He's really one of the people most responsible for introducing that to France, you know,

because like we'll go through some of his business dealings throughout these episodes. And what you find is almost every major business deal that this guy is involved in, there are people who say, hey, this guy fucked me over. This guy straight up lied to my face and made, you know, X, hey, this guy fucked me over. This guy straight up lied to my face and made, you know, X, Y, and Z commitments to me. And then he broke all those pledges as soon as the deal was done. So, you know, this guy's kind of a lying scumbag businessman. And the other thing is, he's not a fashion mogul. Like, I think people get this idea that because he, again, owns the largest fashion conglomerate in the

world that he has like a fashion sense but no he was just a regular businessman his dad and grandfather were in construction and real estate and he just saw a play which we'll talk about that he was able to buy into a fashion conglomerate with support from the french government and political connections but he's really just a businessman, a lying businessman, and he has since used his wealth, power, and influence to influence the French government, particularly the current president, Emmanuel Macron, into all these sorts of reforms that have made him even more rich and even more powerful. I mean, the man has been nicknamed the wolf in Kashmir,

but if you ask me, the man's a skunk. He stinks all around, ladies and gentlemen. I'm just tired of people like this bulldozing their way into industries and then being lauded as legendary house owners, when in my mind, he seems to just be the largest slave owner of intellectual property. The idea of Christian Dior is owned by bernard arnold and in the same way that a slave owner owns a person he owns the idea of christian dior but that doesn't make him christian dior it just makes him a fucking skunk smelly and uh like pepe lepew offensive to women right and we haven't even mentioned the fact that they kill

three million pangolins every day to make their bags yeah not including the way that they treat alligators to get their alligator leather bags just straight gutting them I mean like you know you can envision the

fucking like Scarface scene with a chainsaw just imagine that but with alligators and alligators are fucking raw like they don't fucking die off one cut so a lot of these alligators were just alive just fucking cut across the neck fucking steel beam being pushed down their fucking uh noggin and the alligator legs like is still kind of moving pita had to buy stocks in lVMH to enact any change for them so they didn't treat alligators that way. But if they're fucking treating gators like this,

imagine how they're treating cows. Imagine how they treat people when they're going to be using human skin for bags in the near future. Check out the new Louis Vuitton. It's got the skin of LeBron James. It's going to happen, ladies and gentlemen. Trust me.

Now, if they do it with stem cells, is that okay? It's only excess skin, so. Yeah, people will sell some. If you grow human skin in a lab, is that acceptable? See, this is his plan. Get Americans fat, give them liposuction and take some of their skin, and then resell that skin as luxury products back to the americans i'm telling you it's all cyclical so you're gonna get

americans uh addicted to human human skin leather products yes his nickname is the silence of the lambs billionaire he's actually selling americans these cosmetic creams to make their skin more better for his belts and purses he's playing playing 12d chess here what do you think is going to happen when animals are extinct what is going to happen when oh we don't have any more animals well you can start rocking human skin trust me it's fucking it's in vogue there will always be someone willing to pay for the real thing yeah even if they know that even if they don't know that it's actually fake which we will cover in terms of labor abuses later on in this episode and yeah so again the scale of his wealth is kind of incomprehensible he owns properties all over the world did just want to mention he

owns a private island in the bahamas and as we all know only the most up and up people own private islands near the bahamas um you know and also he hires he has a very close relationship with uh basically every government france has had since the 1980s uh he hires former french security heads to do his security. He has his own little company spies. This guy has a lot of money and a lot of fucking power. And I guess before we start at the biography, I did just want to spend a second on France. Because, you know, as an American, and most of our listeners are American, you might have this idea in your head that France is a bad place to be a billionaire, especially compared to the United States. You might think, oh, they get hosed with taxes,

and there's much better union protection. And in fact, we mentioned this on our episode on Bernie Marcus, the Home Depot billionaire. He was worried, and he gave a quote, that he was worried that if the U.S. passed card check labor union laws, that the U.S. would become France. That was the quote that he gave. That was his nightmare scenario. And the thing is, like France, you know, it's a little harder to be a billionaire there than in the United States, but things are changing. Things have definitely been changing since Emmanuel Macron, a close friend of Bernard Arnault, neoliberal reformer, became president of France in 2019. I just want to give you an example of this, again from the World Socialist website in 2018. In the first half of 2018, France's 13 wealthiest people became $27.8 billion richer than at the start of 2018.

This has made France the country in the world where billionaires are increasing their wealth the fastest, according to a report published by Bloomberg. They give the example in the first half of 2018, the wealth of French billionaires increased by 12.2%. This compares to only 1.2% for the wealth of American billionaires, and 6.3% for the wealth of Chinese billionaires. So, you know, compared to the United States, it's not necessarily a great place to be a billionaire, France, but it's getting better. It's getting much better. And part of this is because President Macron eliminated the solidarity tax on wealth, what's called the ISF, in France in 2017. This was a wealth tax that existed in France since 1981. It's a tax on assets in excess of 1.3 million euros. So he eliminates that. He won't bring it back. Macron slashed the corporate tax rate. He's cut income taxes for the rich. And all at the same time, he's demanded pension reforms.

He's increased working hours. He's tried to cut wages for average workers. He tried to impose an austerity gas tax. And this is what led to the yellow vest protests. But Macron's entire argument— Had sex with his teacher. Yes. But Macron's entire argument for these kind of austerity and these pension reforms and all this stuff is that there's no money.

But the reality is the first thing Macron did when he came into power was cut taxes severely for the richest and most powerful people in France. And he won't put back the wealth tax so it is just something where you might have this idea in your head about France but the reality is right now no country on earth are billionaires having their wealth increase faster than they are in France hey hey ho ho western culture's gotta go it's crazy how like you know as an american i grew up with like a not indicatively propaganda but just like a general pejorative like fuck france you know and i've had a moderate change of heart recently with seeing the french protest footage with like french motherfuckers can fucking bang but then also seeing the amount of fashion documentaries and bernard and all documentaries

i've seen so far i've just been like like, oh, fuck this side of France. Like, I can love a croissant, but hate the elitism that comes across with the snobbiness of French people that is perceived to be all French people. But in reality, is this elite core group of people that certainly seem to own the idea that French is better than everything else. The previous administration running France, the Socialist Party, which is not really a socialist party, but that's their name, they would receive endless shit for making very small tweaks to the wealth tax,

but still basically having it in place, and in some cases proposing to strengthen it which um arnold actually had some some feelings about um but like the the socialist the previous socialist president uh francois aland was trying to like um strengthen the wealth tax for a while and arnold actually got into a thing about trying to get it uh belgian citizenship to dodge it for a while and one of the main newspapers in france liberation they they posted like a big headline um like with a picture of him saying like i think it was get lost you rich idiot

and uh i mean it was in reference to like all right we'll just go to belgium then basically like we don't need you but we do need you do you want your money though and like he tried to sueation magazine for this depiction of him when he was very clearly trying to skirt tax laws. In the documentary I watch, Intriguing Portraits, Bernard Arnault, the 30 billion euro man from 2017 uh they asked him about how he was attempting to move to belg gain he was attempting to gain belgian citizenship to avoid taxes which he vehemently denies but then they found that he paid 13 000 euros to the belgian government in 2011 and he's like no i've i've always paid taxes to the french government like walked out on the interview he got so heated so the man's got tax secrets wait they found out that he paid 13 000 euros to the belgian

yeah so like apparently in the documentary they talk about how in 2011 i believe he stayed in belgium for belgium for 11 days so he paid them because he wanted to be considered a resident like he was starting the paperwork for, I can now legally say I live in France because I have this apartment since X amount of time, you know? But then the things that Steven just mentioned about the magazine running that,

that spread on him among a few other things, he decided to renege that. But I mean, the man was just straight up skirting tax law and got caught doing it. He's like, I guess I probably can't do that. I can see why he wanted to get in with Belgium, because I sound like a cheap bribe. To Sean's point, you can see how far things have gotten out of control with right-wing governments.

I mean, we used to be very critical. People on the left were critical of francois and the socialist government for like doing minor tweaks but now we have people just eliminate straight up eliminating wealth tax wealth taxes and stuff and it like it almost makes you wish for those sort of neoliberally but still center-left governments right yeah and we'll we'll talk about belgium in more detail because you again, when we say there's a hundred different scandals we could talk about, one of them is tax evasion, and we will talk about tax evasion in a bit more detail. It's ridiculous. owns 75 companies he incorporates a bunch of them in belgium and then they'll have like you know one office or they'll have you know one floor with all of the companies on him and like two employees and they'll book you know 800 million euros profit that year in belgium right because

they could pay cheaper taxes on that it's just straight tax avoidance and he's also doing uh was doing shady shit with his foundation to pass on his wealth to his children. And we'll talk about all that. But I did just want to mention French National Assembly member Danielle Obano was quoted in Jacobin saying that, quote, tax evasion costs public services in France 80 to 100 billion euros every year. And she specifically names Bernard Arnault as one of the greatest tax avoiders in France. So the thing is, with all this coronavirus pandemic, there have been demands to reinstate the wealth tax. Because, you know, why should regular people be paying the burden?

Why not, you know, one of the third richest man on earth? But so far they have resisted. And one other thing on the coronavirus, according to Mark Botenga, quoted also in Jacobin, the European Central Bank's pandemic emergency purchase program was checked by a Dutch website, and they saw that a lot of the billions that they have been loaning out have been going directly to LVMH. They get cheaper loans from the ecb than spain or italy could get on financial markets so when we talk about how he's using his government connections we will talk about that and a lot of it is just again free money from the government but also preference in terms of when it's time

for you know collective belt tightening there's no ask that he'd be the one to do it the man's a skunk he stinks he's trying to fuck cats with white stripes on their back okay you don't know what a skunk look like he's just trying to fuck another puss is this racist somehow to compare bernard arnold to pebble to skunks i mean yeah i think there's there's certainly a american imperialistic uh racial view but i i mean french people aren't a race so you know i and it certainly as an indian man i'll get away with it i don't go fuck okay we'll leave it to you then so i've been reading the memoirs of julius caesar and I think this guy had the right idea about French people. He's really, you know, like, this guy had some innovative solutions, and I think we need to give him his due when it comes to the Gallic peoples.

But I guess just before we start the biography, I did want to mention those government connections. When we talk about him being, Bernard Arnault being close to the current president, Emmanuel Macron, he wrote an op-ed endorsing him two days before the election. Macron's wife, the aforementioned school teacher,

Brigitte Macron, Brigitte Macron, she was a teacher of two of Arnault's younger children. She exclusively wears LVHM luxury brands in public. That's like free advertising. Apparently the wife of Nicholas Sarkozy also did that. She exclusively wore Dior in public.

So of course, you know, the first lady of France wearing your brand, that's great advertising. He did a similar thing with the Princess Diana where he gave her a Dior bag and she would take it everywhere and people loved it and they were like, I want Princess Diana's handbag. I want to be just like her.

You think when she stopped wearing it he sent some paparazzi to follow her into a tunnel? It turns out she decided to stop carrying my bag. Send in the hounds. That's Bernard Arnold under closed doors. That's what he sounds like.

Oh, Dan, I am so sorry to hear that you don't want to use my bag. Is this your driver? Would you like some wine? Yeah, what people don't know was at the funeral, he was handing out that bag to people that came so sad the the chilling last phone call he gave to diana where he said you're about to know what an alligator feels like uh but uh regarding macron president macron his um his chief strategist, his former chief strategist, is a guy named Ismael Emelian.

He left Macron's government in 2019 and is now a high-ranking LVMH executive. So this is Macron's chief strategist, is, of course, engaged in revolving door politics between the biggest luxury company in the world. Also, regarding those connections to former French President Nicolas Sarkozy, Bernard Arnault was apparently one of just two witnesses at Sarkozy's marriage in 1995. The wedding of Arnault's daughter was attended by Sarkozy, by the wife of former French President Jacques Chirac, by leading Socialist Party official Hubert Vedrin. Vedrin was a foreign minister in the Socialist government from 97 to 2002. Before that, he was an advisor to the Socialist government of

Mitterrand. He was a state secretary in the 90s. And in 2009, in fact, he joined the board of LVMH, where he has remained since. So you could find a million different examples of this kind of revolving door between the French government and LVMH. Yes, his daughter Delphine Arnault from his first marriage, both of them, her marriage and his first marriage, obviously, have gotten divorced. So you know they don't eat butt but uh delphine arnault is now with a partner who is also billionaire who's wrapped up in some scandals involving uh sex trafficking and we'll talk more about that later on right they divorced because the guy just couldn't bring himself to kill an alligator every time so that she could get off tired of torturing the blood of the alligator just gets me so horny please please please cut please cut the knife please cut

please not the knife cut the alligator you guys think the alligator horny blood bit goes a little too far uh i think it'd go a little farther oh if the alligator is still alive when you have sex with me i just my my my body cannot orgasm please i need i need the blood of the innocent alligator to allow my body to or please please please cut oh the metal rod needs to go deeper. All the way down the tail. Please, please cut. Can I make a request? Yeah, please. Have her talk about how wet her pussy is.

Oh, the blood, once it's revealed, it just, as it comes out, makes me so... Oh, it's like as if my vagene is just as wet as the blood coming out of the alligator, or the lizard from the reptilian blood just fuels my horniness. Yes, please. Now, wait a minute. Yes. Yes.

Release the blood onto my cervix. Yes. Yes. I will divorce you for a man that sex traffics. I die. All right. I've lost interest. I don't know why, but I guess we can continue with this episode. Julius Caesar goes, yeah, you see why I killed all these people?

It's what they're all like. But yeah, and so before we kind of start the biography of bernard arnold i do want to give a couple thanks and a couple citations in terms of what our sources is because again these are this big episode a lot to cover um we drew from a variety of sources uh i read most of the book deluxe how luxury lost its luster by by Dana Thomas. I recommend that one. My three co-hosts watched the documentary Mercy Patron by Francois Ruffin as an activist filmmaker in France who made a documentary about him. Yeah, I want to highly recommend that one. The best way I can describe it is it's Michael Moore tactics as performed tactics uh as performed by french nathan fielder

very excellent documentary yeah you're not right it's imagine michael moore if he takes a cigarette break every 15 minutes and that's and also if you don't have access to that film we have a pink panther source that we can share with you if you would like. And lastly, I do also want to thank one of our podcast listeners, a guy named Ben, who hit us up and helped us out. You can find him on Twitter at Sour Sopin, S-O-U-R-S-O-P-P-I-N. He's a native French speaker. He helped us out with some of the documents and some of the kind of cultural nuances that we miss or that we don't really know as Americans. So big thanks there for the help in researching. And in terms of starting the biography, I think even before we go to the actual birth of Bernard Arnault, which occurs in 1949, I think before we even go there, we should just talk a little bit about the history of both

Dior and Louis Vuitton.itton because you know he buys these brands these companies in the 1980s so he's not directly responsible for the things that he that they did before the 1980s but part of what makes these companies so valuable is their their long history and their reputation as luxury brands you know like if if you buy Louis Vuitton and you know it goes back to the 1850s, goes back to 1854, that has, there's a value to that that just like a company found it two years ago doesn't have. So... I mean, there's a value that we perceive, but that's also artificial.

I want to make that clear. You know, Grubstickers has been around since 2008, but that doesn't make us any better than a podcast that started yesterday. You know what I mean? Not to say that we're not awesome, but the idea that brand legacy is something that has value is artificially inflated by Bernard Arnault. It's certainly impressive, but if you show me a car that's from a company that's been making cars for 300 years and it's shittier than a car company that started two days ago i'm gonna go with the car company that started two days ago yeah absolutely and dior actually so bernard arnold makes his fortune first by buying dior and then by using the profits to buy the louis vuitton company um but dior actually is kind of his first interest and he claims in an interview with

the Financial Times, he recalls a story of when he was living in New York City or in New York in the 1980s, early 1980s, he took a New York City taxi driver who didn't know the president of France who it was, but he knew the brand Dior. So this is like the kind of story he gives about how he recognized the value of these luxury brands is that americans didn't know the president of france but they knew the luxury brands from france um so again there's a real value on that yeah from that documentary i watched when he leaves france for the united states in the early 80s he talks about being in new york and the cab driver being like, oh, I like French culture. And him saying, do you know the French president?

And the guy being like, no, but I do know Christian Dior. But when you think about cab drivers and people that work in the tourist industry, they're just trying to make conversations that they can get a better tip, if you ask me. The fact that this cab driver inspires him to do what he does, I don't know. I kind of think all of his stories are bullshit. He talks at one point that he had a conversation with Steve Jobs, who he considered an idol. him to do what he does i don't know i kind of think all of his stories are bullshit like he talks at one point that's he had a conversation with steve jobs who he considered an idol and

steve jobs told bernard arnold that hey in 50 years i don't know if people are going to be rocking ipods and iphones but i bet they'll be drinking don perry own and bernard arnold champions that story and it's like i don't i don't don't. Steve Jobs not thinking iPhones were going to be fucking popular in 50 years? No. If you ask me, the man's filled with hooey. He stinks like a skunk and a daughter that can only come if she sees alligator blood. He recalls the story of a New York City taxi driver telling him, Hey, buddy, if you want to kill an alligator in the back seat you're gonna have to pay extra um but yeah so to start with uh dior or christian dior as it was originally

called another thing he did with that brand is he took the christian dior he shortened it out just a dior um apparently i'm sure some marketing person told him to do that. It was set up originally in 1946 by a French fashion designer, Christian Dior. This was originally a Paris fashion house focused mainly on clothing and perfume. But what's interesting is Christian Dior was the designer, but he set it up with financial backing from and ownership by a businessman named Marcel Boussac. And that would be who Bernard Ernault would eventually buy it from. He buys it in 1984 and will tell that story. But I did just want to mention this businessman who gave Christian Dior the financial backing, Marcel Boussac,

he was a member of the Council National, a consultative body created by the Vichy French regime during the Nazi occupation. Boussac was very cozy with Nazi officers. Apparently, he was an owner of thoroughbred racehorses, some of which the Nazis actually stole back to Nazi Germany when they were fleeing France. They loved his racehorses so much that they stole some of them. Also, they were facing a gas shortage. You want to get out of there as fast as you can. So another horse billionaire is what we're trying to say here.

Yes. Well, horse Nazis as well. Right. But more important to that, apart from being close to the Vici regime he supplied um busac supplied 110 million meters of high quality fabric to the craigsmarine the german nazi navy so you know in terms of like how does this brand dior come to get the reputation it has today uh the nazi marine craigsmarine yes yeah that's uh that'll be an interesting

side detail when we cover the guy from craig's list uh krieg's marine i guess but anyways looking for undersea boat commander 30 30 marks per hour should be a quick job i'm just imagining the thoroughbred racehorses that the nazis are trying to like desperately gallop out of france and they're going no stop goose stepping go faster Stop goose-stepping. Go faster. But so Marcel Boussac, the money behind Dior, Nazi collaborator, made some money selling fabric to the Nazis. Louis Vuitton, similar story, but it goes back longer. Louis Vuitton is founded 1854. It's first a luxury trunk designer. Trunks were very important for the well-to-do back in the mid-1800s.

You get to go travel. You're some of the few people who get to travel you bring all your stuff on a trunk in the train or the steam liner or however you're getting around the steamer trunk um so it's luggage it's fucking right you need luggage to fucking carry your shit right and so you know to kind of skip to uh their relationship to the nazis uh the brand goes from 1854 up to, of course, the 1930s. Quoting from the book Deluxe by Dana Thomas, the Louis Vuitton family, you know, some members of it resisted. Even I think one died in the concentration camps. But the patriarch of the family was a guy named Gaston Louis Vuitton. He sided, of course, with French General Philippe Pétain's Nazi-backed government in Vichy, again quoting, for, quote, both political as well as business reasons, and instructed his oldest son, Henri Louise, to go to work with Pétain's regime to keep Louis Vuitton going. The company had a store on the ground floor of Vichy's elegant Hotel de Parc

next to other luxury goods shops, including the jeweler Van Cleef and Arpais. All were shut down by the Nazis except for Vuitton. Furthermore, Vuitton opened a factory to produce propaganda items, including more than 2,500 busts of General Vuitton, and his son, Henry Luis, was decorated by Patan's regime for his loyalty. So, you know, this company survives the war because they collaborated

with the Vichy government. And what I also found very kind of funny is this quote from Electronic Intifada talking about Louis Vatan's links to Israeli apartheid and kind of illegal settlements, which we'll talk more about on the next episode. In 2004, LVMH, the company tried to avoid the bad publicity that its Louis Vuitton division collaborated with the Nazis during the German occupation of France. While writing about the history of Louis Vuitton in honor of its 150th anniversary, author Stephanie Bonvinci requested the company's wartime documents, quoting, she was told that the company documents for the period 1930 to 1945 were destroyed in a fire.

So not impossible. It was World War II, but very convenient that the fire ravaged 1930 to 1945 documents entirely. These are those files talking to Gaston. I'm sure I've been burned by you before. This happened to be burned in a fire in one of the uh only cities in europe not to be firebombed it is actually you know minor history note um paris was of course not bombed like andy just said hitler when they were retreating did give the order to destroy paris but you know his uh nazi general in charge could not bring himself to do that.

So the mass murder and deportation of all Jews in Paris was one thing, but the destruction of the city itself was a bridge too far for the Nazis. They just couldn't stop thinking about that alligator blood, dog. They're like, we're going to stop that? Come on, man.

Come on, Hitler. I know you went to that alligator blood post. Come on, dog. They're like, these people aren't alligators they have rights um but you know and again just kind of the thing that's worth noting is so much of the brand's value when it comes to louis vuitton and dior is they survived the wartime period they survived the wartime period by collaborating with the wartime period by collaborating with the Nazis, and this is what gives them the cachet to say,

we go back to 1854, or we go back to 1946, because we're the only people who had money after the fucking war, because we collaborated with the fucking government. But to start the actual story of Bernard Arnault, he was born March 5th, 1949. He was born in a city in northern France, right on the border with Belgium. At the Roubaix Hospital. Right.

His grandfather was in construction. The family company was called Ferret Savinelle. It was founded in 1926, his grandfather's construction company. And apparently, when he was a child, his grandfather took him to these construction sites and it should just be noted that post-war france you know both world war one and world war two there was a construction boom and a baby boom so that was a good business to be in to found a construction company in 1926 because of course france is devastated by the first and then the second world war there's a lot of rebuilding a lot of construction to be done um yeah he's he was instilled by his mom to play piano and his mom and grandmother's love of uh dior and louis vuitton because at that time those companies were known for

making like jackets for old ladies that was kind of their brand's mo in terms of what they produced in that region because the textile factories were in where he grew up according to that documentary watched on amazon uh when his grandfather passed he put a report this is a story from his own mouth which i think is bullshit but when his grandfather died he put a report card saying that he was the top of the class in the coffin as a testament to his grandmother who raised him with a strict catholic upbringing to be the top of the class and to always try and put the family's honor above everything else basically i don't believe i don't believe that this this boy was able to put his report card in his grandfather's coffin kind of odd and creepy if you ask me um but there is a close

relationship to his grandparents who grew up uh not too far from his folks as well and that uh instilled his dedication to being the fucking skunk he became i like how he he made it about his religion like oh this will get you into heaven grandpa i got i got an a and you know the other thing is i couldn't find anything about his family during the occupation itself and i have no idea what they did they probably just kept their heads down but i'm just gonna assume that if they were involved in the resistance the most uh richest person in france would publicize that you know like nothing wrong with keeping your head down, but I would assume they were not active resistors.

So Bernard's father, Jean Arnault, was an employee of his grandfather's company. He graduates from the École Centrale in Paris, a French engineering school. He marries Bernard's mother in 1947. As we mentioned, you know, his mother apparently had a, he says, a quote, fascination for Dior. She wore the perfumes a lot. She also taught him, as we mentioned, the piano, but also horse riding and tennis. He still plays tennis today. And these are class markers in France. These are like kind of bourgeois, at least upper middle class activities to be engaged in, typically. He was partly raised by his grandmother.

He describes her as loving and kind, but, quote, rigorous. His sister he was close to, Dominique, she died of cancer in 2006. And he describes as what he was growing up. He describes breathing through, breezing through high school and not having to work too hard. Then upon entering a preparation program to get into a grand Ecole, he becomes surprised at the amount of effort involved, describing it as quote,

a cold shower. And he has to adapt quickly. He's accepted at the Ecole Polytechnique in Paris in 1969. And just from our listener, Ben, the concept of Grand École, I was not familiar with. Of course, I didn't grow up in France. Basically, Grand Écoles are considered the best school in France in a given domain.

So a Polytechnique is, this is an engineering school, a very prestigious engineering school. And education is highly subsidized in France, so most of these Grand Écolets are public, and the tuition fees are very low. However, they're extremely selective with extremely low admission rates, so the wealthy people, such as, to an extent, Bernard Arnault, they have a leg up because they can, of course, hire private tutors

and do all this other studying that the general public does not have access to. As well as have the connections to the people that run the positions of who gets accepted and who doesn't. Money begets money. Right. So you can increase your odds of getting in by going to an elite prep school. And the prep schools tend to mostly just take students from the elite high schools. And these are mostly white and well-off people within France.

But so he graduates in 1971 from the École Polytechnique, again, France's most prestigious engineering school. He joins his father's company. Again, a very common story with these billionaires we cover. He joins his dad's construction company in 1971. In 73, he marries Anne de Waveren. This is his first wife. She's from a prominent textile manufacturing company, or family, I should say. And through her,

he will get some of the political connections that we'll talk about further on the next episode. But just kind of a weird note, Arnault, from the book Deluxe by Dana Thomas, Arnault kept the marriage a secret from the employees at his father's company. He didn't wear a wedding band, and when his daughter was born,

his secretary didn't even know. What a fucking stinky skunk. What a fucking piece of shit move is that? Right. Well, some people in France really go to the extra mile to have their mistresses not know where to contact the family at. That's fair. But yeah, so as we mentioned, 1971, he's a civil engineer at his dad's company, his dad and his grandfather's construction company. And he convinces his dad, there's various stories of how this actually comes about, but he convinces his dad to basically sell off construction entirely and move into vacation real estate.

So in like 71 or just after they sell off the construction related assets for 40 million francs um they rebrand it from ferret seven l to just uh farinel um in uh 1974 let me interject here sean yeah so this would be at the age of 25 he would help dismantle the construction business and morph it into a rental property empire. In this era, in the early 70s, and with an ad campaign funded by Bernard Arnault, he would create Farinelle into a very popular vacation rental property. In the documentary, he would confide with a co-worker that it was good that his dad was away because I'm going to invest 20,000 francs into an ad campaign on the radio for the company.

The ad campaign was this commercial where this woman is like running around a dude and the guy's like, what are you doing? And she's like, I'm running around the owner of the property. And then there's a jingle. We have the drop right here so this this fucking jingle is his fucking crown gem in the beginning that at age 25 he puts uh 20 000 francs which as mentioned, the construction company they sold off garnered them 40 million. So he uses a percentage of the wealth that he has into advertising these new rental properties and it works like gangbusters.

Because apparently in France, fucking... This is fucking hot. Our listeners can't see, but actually in in that advertisement they're murdering an alligator but yeah this you know it's a fucking it's a jingle in the 70s and it promotes extravagant vacations and this shit this shit works this ad campaign is his entry into high society and what begins the Bernard Arnault story. Right. And so I got the timeline a little wrong there. He joins the company in 71, then in 74, as Yogi mentioned, he becomes the head of construction when he's 25 years old. And this is where his dad apparently gives him the keys to the real estate business,

allows him to run it. He apparently had about a thousand people working for him at the time. So, you know, pretty well to do already. He becomes the CEO in 1978. And just quoting from the book Deluxe by Dana Thomas, within five years of the time he becomes CEO, the company's development arm, Farinelle, had become one of the top private home developers in France, specializing in vacation homes. So this decision to sell off the construction business and just focus on vacation homes and real estate,

it's actually doing very well. He's making good money. But in 1981, Francois Mitterrand is the first popularly elected socialist president of France. He becomes the first socialist or avowed socialist to become elected president of France. And unsurprisingly, the business community freaks out. You know, he starts by nationalizing banks and major industrial businesses at the start of 1981. So, you know, rich people panic. And Bernard Arnault is one of them.

He actually flees France and moves to the United States for about three years. Right. Yeah, he moves to Florida and decides to develop properties in Palm Springs, Florida. In that documentary, Intriguing Portraits, Bernard Arnault, the 30 billion euro man, he says, I wasn't escaping France. No, no, no, no, no. I went out to see the ocean. The water was calling me.

He literally goes, I wasn't leaving because I was afraid that the government was going to cut my head. I was leaving because the water beckoned me. Word, the fucking Mediterranean Sea wasn't close enough. You had to go to fucking florida right and you know so of course uh this is the period where he's living in the united states from like 81 to 84 where he has the thomas friedman talking to a cab driver to get your worldview experience right um i also wanted to get some like hands-on experience on the alligator strangling great you gotta really start to understand your product um but again from the book deluxe by dana thomas he moves out to

long island with his wife and his two children at the time uh he buys a splendid splendid mediterranean style home facing new york's Island Sound. He enrolled his children in good schools. He began building vacation homes in Florida with moderate success. But Bernard gives a quote, quote, It's tough in the United States if you haven't moved in the right circles from the start, unquote. So basically, yeah. So, I mean, you know, look, we can't deny that this guy knows how the game is played, where he makes some money. It's hard to see what he was actually doing, but it's kind of an obscure period of his life. But he was clearly moving in Florida real estate. But he even admits as much, like, it's harder to make a fortune in the United States if you haven't moved in the right circles from the start. And so what's going to happen, and we'll continue this on the next episode, is President Mitterrand of France is going to make a neoliberal turn around 83, 84.

He's going to fire some of the more socialist advisors. He's going to turn the page and go in a new direction. And Bernard Arnault is going to be smart enough to see that and come back to France, where he has moved in the right circles from the beginning, and he is able to make a fortune with these political connections. And I guess just the last thing I'll say on this side is, as we mentioned, this guy is not a fashion icon. He's just a businessman. And so he's in real estate, he's in construction, and he recognizes that the brand Dior and all the other companies that are folded up into it is going to be in trouble in 83-84, and he's going

to come back and he's going to buy it with the help of the French government, basically out of bankruptcy. And he's going to reorganize it, and he's going to do all this kind of, let's say, American business downsizing, firing employees, streamlining operations, you know, getting rid of all the manufacturing bullshit, eliminating 8,000 or so jobs, just get rid of everything except Dior and go back on his promise to keep those jobs. And this is how he

makes his first score. And just from there, it's been all the way up. And we'll continue this discussion on the Patreon site. Before we go, we lost a very, very well-respected and a friend of our show's, Michael Brooks, suddenly and tragically passed away. He was graciously on our show and was very kind and generous

to not only be on, but to let us know he enjoyed what we were making. I think I might have been the least acquainted with his work, but after his appearance, I got to know more of it. But the thing I gleaned from my short time with them was just how kind and generous he was. I think that it's maybe a misnomer, but oftentimes in the podcast world, if you have heat, you could be a dick. I mean, just in any industry, if you're popular, you could be an asshole. And Michael Brooks was so kind and considerate. Oftentimes, I usually dislike people associated with Boston.

But Michael Brooks, surprisingly, was exemplary in kindness, compassion, and truly listening. Not wanting to talk louder than you when you were speaking, but to be able to comprehend what the person across the table was saying to make sure that what you said was heard equally. It's a tragic loss. Yeah. Michael Brooks died suddenly at 37 years old. It's very sad.

And, you know, I'd known the guy less than a year. And he actually just Twitter DM'd me kind of out of the blue one day. And I've read a lot of people have had that experience. You know, our listeners might know he came and he did our episode about Adir Macedo, the Brazilian billionaire. He would later, he told us at the time, but he hadn't announced it yet, he would later go and interview former Brazilian president Lula.

And that was, of course, a major highlight for him because Lula's an inspiration to him as well as the rest of us. And it was so nice because he came out and it's somebody who is coming onto a smaller podcast just for the fuck of it. He didn't really get anything out of doing it, but he was the nicest fucking funniest guy you could meet. And I mean, it's just such a tragedy because like I said, I only knew the guy less than a year. Twitter DM'd back and forth.

The only time I got to meet him was when he came and did the podcast. And it's just something you assume, like, he's in his 30s. As soon as this coronavirus is done, we're going to go get a beer or we're going to go hang out or I'll go see him at a show. Or, you know, the next time there's a leftist book party or whatever else, you'll just see him around in New York. And it's very tragic. And I just I hate that he would hit me up from time to time and, you know, be like, hey, man, check out this video. And, you know, I would. Or I, in one case, there was like one I was like, you know, sorry, I'm busy right now.

I will check it out later. And then it's like, you just don't realize that this, that it's going to end suddenly like that with no way of knowing. And I was very grateful for the time that we all got to spend with him. And it's just a fucking tragedy that it all ended so suddenly and there won't be any more time. And I guess the last thing I would say is there's factional stuff on the left you know we all have political disagreements and it can be very passionate and very heated sometime and michael was one of those guys who was a peacemaker he was loved by all sides but he was a very smart thinker he thought he talked to everybody you know part of why he kind of sometimes got it from all sides was he'll talk to everybody

no matter what your views are. If he thinks your heart is in the right place and you're a smart person, he'll talk to you and he'll try to understand where you're coming from. And it's just such a tragedy to me because I know, as you might know, based on my particular Twitter preferences and grievances, I am not a coalition builder. What? I am not a, let's say, universally beloved figure. I have my partisan biases. But Michael was the kind of guy who is beloved by people on what can be called, quote unquote, my side, but also the other side on every side of the left. And I think the only hope going forward is that there are people like Michael that can build bridges across all sides

of these very at times passionate political disputes and um you know when I thought of what the left would be going forward it was people like Michael who would be leading it and kind of you know he had all these plans to build all these media networks and and bring all these people together and explore all these different ideas. And I don't know, man, just on both a political level and both on a this guy was my friend and I'm so fucking sad that I won't get to see him anymore level. It's a major tragedy and I'm going to miss him. But I am grateful for the time that I got to know him. Yeah, losing him was just heartbreaking

and gut-wrenching. And I think his, you know, from the little time we had with him, he seemed really devoted to bringing joy to activism, which can be often a very uh joyless task if you if you let it get to you and uh i i think that a great way to i think honor him and remember him is to just continue in that spirit that you know uh even when we're facing tremendous adversity as we are now um you know try to try to take a

page from his book and and just celebrate the victories and try not to let the losses get to you because, uh, otherwise you'd be overwhelmed. And I think a lot of, a lot of what he did and a lot of, you know, what I've, I've,

I've seen from the outpouring of support, um, for him, for what he did was, it was, you know, really helped people in, in just getting,

getting through this fight and doing it with such a positive and funny uh perspective and and losing that is i i think a a big loss for all of us yeah i mean i i didn't know michael other than through his interactions with our podcast and like really mainly through his work with Jacobin and stuff. And how I going to remember him as someone who was like really keen to create a platform for, and bring back rigorous debate among leftists where you're free to say what you want. And it's not like a,

you can all be free thinkers and passionately debate things and it brings you closer together it doesn't uh divide you up and he wanted he was like very compassionate in that way and he combined it with this like burning desire to really to to win those electoral battles and to win those policy fights and like all get like he wanted everyone to get a lot sharper but also more compassionate and i think that was like he's a really dynamic guy in that regard i'm gonna miss him for that yeah i um i remember so the episode we did we um recorded with him at the time of uh we just found out about the wipeout of the the labor party under corbin in the united kingdom and we were all feeling very depressed going into it but i just remember having him there and talking to him for hour and a half or we did a long, I just remember how much better I felt at the end of it.

And that's kind of like what he was so good at, is like he wasn't a Pollyanna. He understood how the world worked very well, but he had such a good attitude. And, you know, there were a lot of people who talked about how good he was at kind of talking callers and just other people off the ledge after bernie won and everything else just the work goes on and we and we have to and we have to play our role in that and he just had this one quote that i that i loved that i that i retweeted i'm paraphrasing i'm sorry but it's um be kind with people and be ruthless with systems and i think that's the best approach that you can have going forward. And also, I did get to DM him one time, because

when he did our episode, if you listen to it, he does this very funny Trump impression about Trump gives that speech where he goes, you know what my second favorite book is? The Out of the Deal. And you know what my favorite book is? And then, you know, the crowd applauds. He goes, you know what my second favorite book is? The Out of the Deal. And you know what my favorite book is? And then, you know, the crowd applauds. He goes, that's right, the Bible. And I just remember, I just had that in my head for like months, just like his impression of Trump going, that's right, the Bible. And I got to DM and just tell him how funny that was.

And it still makes me laugh. And, yeah, thank you, Michael. And if you're listening to this, just the people you want to spend time with, just hit them up because, you know, even if they're young, people can die like that at 37 years old, and you'd never know. So just be nice to people and spend time with your loved ones and with that this has been grub stakers i'm yogi polly wall i'm eddie palmer i'm steve jeffries uh i'm sean p mccarthy uh we will continue this discussion of bernard arnold on the patreon

we'll talk further about his labor abuse animal cruelty environmental damage um government connections tax evasions all of his scandals. We will continue this story on our Patreon. Thank you for listening. Rest in peace, Michael Brooks.