How the wealthy Obamas could become wealthier
FORMER FIRST FAMILY COULD SPEND DECADES MAKING A FORTUNE FROM MULTIPLE INCOME STREAMS
Speaker? Professor? Author? Board member? Owner of a professional basketball team? Those are among the job prospects being bandied about for Barack Obama’s time postpresidency.
All ex-presidents receive an annual pension of $205,700 annually (all figures US), which is pegged to inflation. And Obama’s kicked in on Jan. 20. They also receive federal money for offices and administrative help. Beyond that, they are on their own.
Obama is a relatively young man of 55, so the ex-president — who is kicking back for a few days near Palm Springs in Rancho Mirage, Calif. — could spend decades making a living from several income streams.
One safe bet is public speaking, which has enriched most former presidents. An ex-president can command $250,000 and more for a speech.
“We don’t know what Obama is going to do, but I’m comfortable saying he isn’t going to go out and grab as many highpriced speeches as he can get,”
said James Thurber, director of the Center for Congressional and Presidential Studies at American University. “He’s going to lean toward book writing, writing his memoirs. He’s an intellectual who has had good success with two books and probably will have good success with future books.”
In just 2009, Obama earned $5.1 million from those two books, The Audacity of Hope, and Dreams from My Father.
The New York Times estimated that Obama and his wife, Michelle, could earn anywhere from $20 million to $45 million from future book contracts. And Obama said in his farewell news conference that he would like to write after leaving office. It worked for former president Ulysses S. Grant. Grant secured his family’s financial future when the Civil War hero finished his memoirs while suffering from terminal throat cancer.
The Obamas are already wealthy. One report a year ago pegged the president’s net worth at $12.2 million. That and his pension should keep him comfortable as he rents a home in Washington’s upscale Kalorama neighbourhood for
$22,000 a month. Obama, an avid golfer, is also reportedly noodling around for a home in Rancho Mirage, where golf is akin to a religion.
Obama could go back to teaching. He was a lecturer at the University of Chicago Law School for 12 years before he was elected to the U.S. Senate. The Harvard Law School graduate could return to Chicago, where the Obamas own a $1.5-million home, or teach in Washington, D.C., or at Columbia University in New York, where he studied as an undergraduate.
“Any university would love to have him,” Thurber said.
Law professors generally earn $150,000 to $200,000, but that can vary depending on their experience.
There are other options. The former president could follow the Clintons and start a sprawling foundation. Any corporate board would probably be happy to have a former president at the table.
Corporate boards pay well, with many offering healthy six-figure fees and private jet travel to and from the meetings. Obama has said he does not want to travel by commercial air
in the future.
“He doesn’t seem like the type to serve on boards of corporations,” Thurber said. “Maybe on a board of a university and maybe a foundation, but even that is unlikely.”
Time magazine recently speculated that the lanky executive, who is considered the best basketball player to serve in the White House, may want to own a professional basketball team some day. But most NBA teams throw off little wealth to their owners, who are generally super-rich businessmen who own the team for reasons other than income.
Besides, even if he earns tens of millions in his post-presidency, Obama would be hardpressed to afford even a small chunk of an NBA team. Forbes magazine estimates the average NBA team is now worth around $1.25 billion. Of course, he could be a part of a group that buys all or a piece of a team.
In the end, Thurber sees Obama following more the Jimmy Carter model, with fewer paid speeches, some social and do-gooder involvement and lots of book writing.
HE’S AN INTELLECTUAL WHO HAS HAD GOOD SUCCESS WITH TWO BOOKS AND PROBABLY WILL HAVE GOOD SUCCESS WITH FUTURE BOOKS. — JAMES THURBER, DIRECTOR OF THE CENTER FOR CONGRESSIONAL AND PRESIDENTIAL STUDIES AT AMERICAN UNIVERSITY