By Nelson D. Schwartz

The Velvet Rope Economy: How Inequality Became Big Business
Editions:Paperback: $ 17.00
ISBN: 9780525435655
Hardcover: $ 28.95
ISBN: 9780385543088
ISBN: 9780385543095
ISBN: 9780593169421

From New York Times business reporter Nelson D. Schwartz comes a gripping investigation of how a virtual velvet rope divides Americans in every arena of life, creating a friction-free existence for those with money on one side and a Darwinian struggle for the middle class on the other side.

In nearly every realm of daily life - from health care to education, highways to home security - there is an invisible velvet rope that divides how Americans live. On one side of the rope, for a price, red tape is cut, lines are jumped, appointments are secured, and doors are opened. On the other side, middle- and working-class Americans fight to find an empty seat on the plane, a place in line with their kids at the amusement park, a college acceptance, or a hospital bed.

We are all aware of the gap between the rich and everyone else, but when we weren't looking, business innovators stepped in to exploit it, shifting services away from the masses and finding new ways to profit by serving the privileged. And as decision-makers and corporate leaders increasingly live on the friction-free side of the velvet rope, they are less inclined to change - or even notice - the obstacles everyone else must contend with. Schwartz's "must read" book takes us on a behind-the-scenes tour of this new reality and shows the toll the velvet rope divide takes on society.


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Reviews:Anonymously on Publisher's Weekly wrote:

"Schwartz explains economic concepts clearly and succinctly, and avoids anticapitalist dogma in making his case for reform. Entertaining and infuriating, this carefully balanced inquiry strikes the right chord."

Kanishk Tharoor on New Republic wrote:

"Schwartz’s book has the virtue of making inequality less the measure of income disparity and hypothetical figures, and more the matter of lived outcomes. In his reporting, he brings to bear everything from the byzantine hierarchies of airline boarding groups to the vagaries of ticket pricing at new sports stadiums to reflect a single reality: Free-market forces are restructuring the economy to provide more services and perks for those who can afford them, while constricting whatever remains for everybody else. [...] In what reads at times like a series of reported newspaper features stitched together [...] Schwartz tours the many arenas of the velvet rope economy, noting how it stokes envy among some consumers while dangling the promise of exclusivity and ease before others. [...] The Velvet Rope Economy is unrelenting in its assault on the facade of the country’s meritocratic order. But the book has a harder time showing what is new about much of this. The wealthy were perfectly capable of separating themselves from the masses throughout the nineteenth century and for much of the twentieth. [...] a note of nostalgia seeps through his analysis, as he harks back to an ill-defined age when American life was not as stratified, when the private sector worked in greater harmony with the public interest. When was that time? [...] Schwartz offers conventional center-left remedies to the various ills of the velvet rope economy, including tax hikes, the closing of loopholes that allow companies to evade taxes, expanded Medicaid programs, higher reimbursement rates for Medicare, more fine-tuned regulation of the airline industry. But we will still have to learn to live with segmentation. “Barring a revolution—and I’m certainly not calling for that—Velvet Ropes will not disappear,” he writes."

Anonymous on Kirkus Reviews wrote:

"While Schwartz expresses dismay about how so many owners of the businesses offering these discriminatory services seem to lack a moral compass—a sentiment that will resonate with nonwealthy readers—he does understand that the profit motive driving expensive privilege is unlikely to disappear in this ultracapitalist nation. Refreshingly, the author also discusses businesses that treat individuals of all income levels more or less equally, including Southwest Airlines, Starbucks, Best Buy, Target, and the Green Bay Packers NFL franchise, which is publicly held. Schwartz opens the book with a Bob Dylan lyric: “Money doesn’t talk, it swears.” Some readers may swear at the compelling yet maddening examples the author uses to illuminate the privileges reserved for the ultrawealthy. While Schwartz doesn’t offer many solutions, his description of the problem is well rendered. An original entry in the growing literature on income inequality."

Kyle Burbank on Dyer News wrote:

"you might be expecting a 300-page Bernie Sanders stump speech. However you may (perhaps) be relieved to learn that that’s not really the case. While you may pick up on overtones that might feel at home in the presidential candidate’s campaign platform, the book goes well beyond looking at how inequality has grown but why it has. This latter question is actually far more complicated than you may expect, with Schwartz exploring everything from psychology studies to some shocking business stats. For example, one of the most interesting statistics I found was that just 5% of Delta fliers supply more than one-quarter of the company’s earnings — no wonder the perks for elite customers have grown more and more elaborate. [...] If there’s anything that I didn’t care for in the book it’s that it can feel a bit repetitive at times as it consistently refers to a handful of examples, harping on them a tad too much. That said, while airplanes and cruise ships are two very obvious instances of the 'velvet rope' Schwartz refers to, there are plenty of other implementations highlighted that you might not have thought of. [...] Despite some pointed jabs and criticism at the haves and have-not dichotomy that many businesses have created, The Velvet Rope Economy doesn’t fully villainize the practices presented across the board. Instead, the book seems to serve more as a call for awareness regarding this trend and push back if they don’t like it, “voting with their feet.” In that way, the book might be more pro-capitalism than you might expect. Schwartz even makes clear he isn’t calling for revolution — noting that some of the practices are far less egregious than others. And, to his credit, I felt as though Schwartz was fair when profiling his numerous examples, highlighting facts that might not always play into his premise. [..] Rather than rant about pet peeves and annoyances, the author clearly poured a lot of time and research into the book, leading to a work that is not only well-written and entertaining but often persuasive as well. "

Barbara Spindel on The Christian Science Monitor wrote:

"Schwartz’s examples are wide-ranging. [...] In the private sector, this escalating tiering of customers is driven by pure economics. [...] But Schwartz is particularly concerned with the extent to which a velvet rope is being erected in the public sector too. [...] The author not only tells fascinating, readable stories, but he explains why they matter, especially now, when our politics and culture seem more polarized than ever. He bemoans the fact that there is less incentive for the wealthy to invest in public spaces when they increasingly have the ability to opt out of them entirely. [...] Perhaps in a discouraging sign of how intractable these caste conditions have become, Schwartz is less effective when it comes to proffering solutions for the problems he so forcefully describes. [...] Reading this enthralling book is not a downer, but its inescapable implication – that we’re fast becoming an even more divided society with an irreparably frayed social fabric – sure is."

Chris Bond on his company's blog wrote:

"The reader cannot tell which side of the rope Schwartz stands on politically until the book’s conclusion, almost as if he stuffed it in at the 11th hour behind the backs of cautious Doubleday execs with their just-the-facts-ma’am edict. In the end, we learn he’s a bit sickened by tax cuts which exacerbate rising inequality, noting how troubling it is that 40% of Americans make less than $15 an hour and 50% don’t own a single share of stock. Informative as it is, this would be a better book if he threaded its eight chapters with some color commentary. When learning about luxurious bunkers being constructed for obscenely wealthy people who fear “we are one unjustified police shooting away from having riots across the United States,” this reader for one would appreciate an embedded reaction, perhaps something along the lines of how billionaires might recognize that the real problem is appalling social injustice, not limited shape options for the bomb shelter swimming pool. It’s still worth reading. Just know when you crack this one open you’re gonna see dickheads galore on the other side of the rope."

Schwartz Talking about the Book

Relevant Links

About Nelson D. Schwartz

Nelson SchwartzNelson D. Schwartz has worked at The New York Times for a decade and has covered economics since 2012. Before that, he wrote about Wall Street and banking for The Times, and also served as European economic correspondent in Paris from 2008 to 2010. He joined the paper in 2007 as a feature writer for the Sunday Business section. Schwartz is a graduate of the University of Chicago, and worked for 10 years at Fortune Magazine before joining the Times. A native of Scarsdale, N.Y, he lives with his family on the Upper East Side of Manhattan.

Table of Contents of The Velvet Rope Economy

  • Introduction

Inside the Velvet Rope

  1. Envy
  2. Eclusivity
  3. Ease
  4. Access
  5. Security

Outside the Velvet Rope

  1. Exclusion
  2. Division
  3. Isolation
  • Conclusion