Carlos Slim Helú: Telecom titan

Welcome to Good Bad Billionaire from the BBC World Service. Each episode we pick a billionaire and we find out how they made them money. Then we judge them, are they good, bad or just another billionaire? My name is Xing Singh and I'm a journalist author and podcaster. And I'm Simon Jack, the BBC's business editor. And on this episode we have Mr. Mexico himself.

Exactly. Very hard to walk out of the door in Mexico without putting money in this man's pockets. No slim pickings for this guy. No. And he is indeed called Slim. His name is Carlos Slim Elu. Although everyone just calls him Carlos Slim. Now 84 years old, Carlos Slim has been compared to the so-called robber barons of the US. People like Rockefeller, Carnegie, JP Morgan, people with monopolies of certain industries. But he is just one man and his vast business empire is a conglomerate in every sense of the word.

Hundreds of companies in construction, mining, oil, real estate, insurance, publishing, airlines, hotels, oh my god, I'm running out of breath. But that is not the end of it. Your average Mexican interacts with one of his companies almost every day. And that is, by the way, 130 million people who wake up in a house heated by Slim's oil, paid for by a mortgage at his bank, they shop in his department store, eat at his restaurant and smoke his cigarettes before driving home on roads built by him.

Yeah, such is his dominance that Mexico has sometimes been called Slimlandia. And in the late 2000s, he actually became the richest person in the world, a title he held for several years. I remember that moment when he was named as the richest person in the world, because I thought, who the heck is this guy? I'd never heard of him, and there he is edging out Bill Gates.

Yeah, I think maybe if the first and only Mexican to become the richest man in the world. But despite his vast wealth and he is a centy billionaire, that means he's got over $100 billion, he's described as frugal. He once apparently haggled with a store owner for several hours to get $10 off a tie.

And he has lived in the same relatively modest six bedroom house for decades. He's actually said the house where I was born in was better than the house where I now live. He actually drives himself around Mexico City, although of course he is followed by a convoy of heavily armed bodyguards. And he does have an idea of a good time, which is smoking a Cuban cigar while reading about his hero, the Mongol warlord Genghis Khan. Hmm. Interesting hero. That's one business mentor.

And as the richest man in the world, back then, he didn't even use a computer, much to the chagrin of Bill Gates, I'm sure, who he edged out. Instead, he used to keep track of his business dealings in notebooks. Now, his real extravagance only really comes down to art and artifacts. So if we step into Slim's office, you'll see Michelangelo, Van Gogh, Renoir and Rodar. Yeah, he's got so much he founded an art museum called Museo Sumaya to help house it. That's named after his wife. Reportedly, art collection worth a cool billion dollars.

Now, as he mentioned, he's no longer the richest person in the world. But this year, he's still saying pretty at number 14. Yeah, that's partly because we've seen in other episodes the rise of the tech titans. So as they've got richer, he's slipped down the list. But as you say, still worth over $100 billion. And his most valuable business, the industry he's probably best known for, is the Latin American telecoms company, America Mobile.

So he's so dominant in that market that he's widely been called a monopolist and in fact many blame Carlos for Mexico's slow economic development which we'll get into later. Yeah, in a country where over a third of the population live in poverty, he's seen by some as a symbol of massive inequality. So is Carlos Slim good, bad or just another billionaire? We'll find out.

Let's go back to the beginning. Let's take him from zero to a million. So Carlos Slim was born in Mexico City in 1940, the fifth of six children to Lebanese Christian immigrants. Before Carlos was born, his father opened a general store in 1911.

And that's always pretty successful. So his dad invested the profits in commercial real estate. And by the time Carlos came along, his dad was a rich businessman with a significant property portfolio. And like father like son, the dad encouraged young Carlos to take an interest in his business, taught him how to read financial statements, keep records. And every Sunday, he would give Carlos a five peso allowance telling him to record every purchase in one of those notebooks. Now, dear dad would actually tell Carlos money that leaves the business evaporate.

Which turned out to be very interesting, because it was through the reinvestment of all those proceeds in more and bigger companies. It is kind of the secret of his wealth. Yeah, it really supercharged his finances. And Carlos actually still keeps the ledgers from his dad's store in his office, as well as his own childhood ledgers. You know, we mentioned as a billionaire, he still uses notebooks rather than computers. Clearly, he's a man who prefers paper.

Yeah, at 10 years old, he opened a checking account, a current account, but he quickly realized he wasn't getting much return on his deposit. So instead, he bought government savings bonds. Those are things that the government will issue. You can save money. They give you a rate of return and that money the government can use to spend. So we have the similar sort of thing here in the UK and you get a better rate of return than just leaving your money in the bank.

But I'm going to guess that there are not a lot of 10 euros in the UK currently investing in those. No, unless their parents have done it for them. And by the age of 12, he made his first stock market investment buying shares in the Mexican bank. I was just talking to a billionaire called Ray Dalio, who now runs the world's biggest hedge fund last week. He said he made his first stock purchase at exactly the same age, age 12. What is it about 12-year-olds? 12-year-olds. Some 12-year-olds are clearly just meant for business.

But tragedy struck when Carlos was just 13. His father died from a heart attack. And it's obvious Carlos found his death extremely painful. He actually stopped socialising. He says he stayed in his home for two years. But he was smart. Two years later, he studied high school. He became top of his class despite being bullied as the son of Lebanese migrants. Interesting background. Maybe that immigrant mentality pushed him to work hard.

But, you know, he was still a fan of things like baseball. He traded baseball cards in the playground. He became a New York Yankees fan. And as an adult, he actually doesn't have that many hobbies apart from baseball. He's said to have a moneyball memory for baseball stats, something he also uses in business. Yeah, moneyball referring to that movie made about the way that manager came along and used stats to compile the best value team he could for money. And it turned out to be a fantastic success.

And also something used across different sports now, like, you know, Premier League football. Exactly. He was a precocious investor. He attended his first AGM general meeting of shareholders as a teenager when he was interested in a mining company. By 17, his net worth was 32,000 pesos. Now, the average annual wage in Mexico at that time was roughly 10,000.

So he's doing pretty well for himself as a teenager. Yeah, if I can translate that into UK terms, the average annual salary in the UK is £35,000 give or take. So three times that would be £100,000. So at £17,000, he's doing pretty well.

but he was also interested in further education. So he didn't drop out like most of our billionaires. He attended the National Autonomous University of Mexico studying engineering. Yeah, he was a top student. He was even asked to teach some of the other students, algebra, and he formed a student investment club with an entry requirement of a few hundred pesos. Think of book club, but you bring ideas to invest to the club rather than books.

And also you have to pay a membership fee, which is quite a canny business. So clearly destined for something in the markets. So he became a stockbroker after finishing his studies in what was a fledgling stock market in the early 1960s in Mexico. He was part of a group of young stockbrokers who became known as Los Casa Boceros or the stock market boys. They were traded by day and played dominoes by night.

A fellow Casa Bolseros said Carlos wasn't that interested in partying and trading. He never liked money as much as the rest of us, weird. He just wanted to be a good businessman. And Carlos had read business guides, including how to be rich by Jay Paul Getty, who was then the wealthiest man in the US that said one should cultivate a quote, millionaire mentality by being always and above all cost conscious

and profit minded. So by his mid 20s, he opened his own stock brokerage firm and founded a real estate business. His name was a combination of his and his future wife's name. Now, Samaya Domet, the love of his life, he met her when she was around 16 and he was 24 through their mums, but it seems like a kind of genuine love story.

pictures of the couple looking very old-school Hollywood glam staring into each other's eyes. I mean, it kind of looks almost a little bit Adam's family, like because Samaya has such a gigantic hairdo. Yeah, it does look like the golden years of Hollywood there. So they married in 1966, at this point he's 26 years old. They went on a fantastic honeymoon, England, Greece, New York, Naples, Spain, France, about 40 days, seeing different places, cities and countryside.

Luckily, he can afford all this international travel. His brokerage firm does well and combined with the real estate by the time he was married, he was worth $400,000. So he is at this point almost halfway to a million. A million US dollars is a lot in Mexico as well.

And this is Mexico in the mid 60s, so big money. So he then sets about using this cash to get into all sorts of businesses. He said his success comes from spotting opportunities early, something he learned partly, apparently, from reading futurist writer Alvin Toffler, whose best selling future shock book explores the psychological and societal effects of rapid technology and social change.

Now, actually, interestingly, later in life, the author himself sent Carlos Manuscripts to review. That sounds like a job application to me. Bring me on as a consultant. Exactly, please. I hear you're a fan. So, at the time, it didn't seem to matter what industry. The thing that he was on the lookout for was a bargain. So, an unloved asset that could make him a tidy profit. Yeah, that reminds me a bit of one of our other billionaires there, which is Warren Buffett, always on the lookout for companies which have got great potential at knockdown prices.

So in Slim's example, he would buy a bottling plant, a soft drink company, a copper mine, a printing company, and then he goes around turning around their fortunes. And interestingly, these are all very different businesses. Clearly hasn't got specific knowledge of each individual business area. He just has a sense of what's undervalued, what isn't, what's going to prosper, what isn't, and having a diverse portfolio in lots of different businesses, having your eggs in more than one basket, can insulate you against risks of which there will be plenty in this story.

It's so interesting because to non-investors, like myself, the idea that you could invest in something you don't actually know very much about or have specialist inside a knowledge of seems quite strange. It seems that you're taking an unnecessary risk. But clearly, this isn't the first billionaire we've heard of who's invested in a vast majority of things.

I think the mentality is you look at the market share of the business it's currently got, whether that market is going to do well, whether it's telecoms or finance or cement or whatever it is, and then you look at the returns you're getting, the profitability of the business versus the price. You add all those things together, you can begin to get an idea whether something's a good investment or not. It's almost like the moneyball approach, right? Yeah, exactly.

Now, in 1976, Carlos spends $1 million buying 60% of Galas de Mexico, a small company that prints the labels for cigarette packets. Now, this is an investment that will soon become very significant. Indeed. And in 1980, he combines all of his business interests into a conglomerate company called Groupo Galas, later changing the name to Groupo Caso, again borrowing the initials of his much loved wife.

So by 1980 his conglomerate is starting to take shape and with a huge raft of profitable companies and if he's buying just one of them for one million dollars it's safe to say that Carlos Slim is almost certainly a millionaire. 1980 he's made a million but he's about to make possibly his most important purchase which will help him get from a million to a billion.

Now, it can be hard to determine why and how some of our billionaires do what they do in business. But Carlos actually wrote his 10 business principles for Group Ocasso very early on. And these principles are distributed annually to all employees, a little guidebook for employees. They're available on coloslim.com, a wonderfully 90s website. Do check that out.

Yeah, it looks like a little retro Geo City's website. And we're not going to cover all of them, but I think it's quite interesting to read about his kind of guiding philosophy, one of which is that, and this is rule number two, you have to maintain austerity in good times as this strengthens profits and accelerates the development of the company by avoiding drastic adjustments in times of crisis.

This reminds me of something that George Osborne of Chancellor in the UK once said, you've got to fix the roof while the sun is shining. And what it means is sometimes when the good times roll, it can be tempting to over expand, grow too quickly, and sometimes you can get into trouble that way. So, Carlos Slim, you know, thinking of business as a kind of philosophy and attitude towards life. There are a couple of the other ones I quite like. It says, all times are good times for those who know how to work and have the means to do so.

An optimistic guy, you'd say? Yeah, in fact, one of his other principles, firm and patient optimism, always yields its rewards. I wonder how much of an inspiration this was to rest of the employees in his company or whether this is just something they kind of received in their inboxes with another kind of like, oh, Carlos, is that a game? The principal's company came and printed on the back of your past to get into work. It's one of those kind of things I reckon. Interesting. If you work for Group of Castle, let us know.

Back to 1981, he buys another company that will be an incredibly important purchase because he uses the profits he's made from Galastamexico, his company that prints cigarette labels and buys 51% of the company's biggest customers, the cigarette maker Sigatam.

Now, Sigatam was Mexico's second biggest tobacco company, which had the license to make malbros in Mexico. Yeah, this business gave Carlos something he needed, a very strong cash flow to spend. And there are some businesses which are highly cash generative. Cigarettes is definitely one of them. Even today, the returns you make on buying cigarette companies, which a lot of people don't want to do anymore,

are incredibly high. And what cash does is if you got cash flow, you can use that cash to service any debt you want to take out. If you got cash coming in, banks will lend you extra money. Right. And that's because people will always just buy cigarettes because people are addicted to smoking. Well, it's a bit like newspapers were back in the Murdochs era. They generate a lot of cash coming in every day, not so much now, of course, with the internet and what that's done to newspaper empires.

So the importance of having a kind of cornerstone of your cash engine, right at the center of it, hugely important. A big roaring furnace of cash. Yes, exactly. And his timing on this was pretty good because Mexico was about to go into a debt crisis. Mexico had had huge debt for some time, but it was also a major oil producer, so I was able to service those debts. But in the early 80s, international oil prices were collapsing.

And this led to Mexico declaring what's known as a sovereign default in 1982. Now, sovereign default is a country saying, I cannot afford to pay the money that I've borrowed and basically governments borrow money on international markets from international investors. And there comes a point sometimes in some countries where they default on this debts and say, I can't afford to pay it. It's a very big deal.

Right. Is it basically like a big red alert emergency sign? The problem is, is that no one wants to do a sovereign default because it can really hamper your ability to ever borrow money in the future. Either people won't lend it to you at all, or they'll charge you an awful lot for the privilege of borrowing it.

And presumably it's also terrible for the businesses that are in your country, right? It can be because those businesses also borrow money on international markets. And if the country itself is defaulted on its debts, it basically makes the entire country look less credit-worthy and all the companies in it.

So how did Mexico respond to the sovereign default? Well, the outgoing Mexican president, Jose Lopez-Potillo, nationalised the banks, which made capitalists feel the country could be becoming socialist. Yeah, so investors, business owners, they fled the country, which meant they were putting up companies for sale, going seriously cheap, some fought as little as 1% of their value on paper.

And Carlos Slim was looking on. He remembers of that time. The year 1983 was crazy. People wanted to sell not only their investments, but also their companies. And so he uses this influx of cigarette cash because people still light up in a financial crisis. Maybe more. Maybe more, because they're so stressed. And he went on a shopping spree. And this is a fantastically interesting moment because, again, Warren Buffett, who the greatest investor of all time, some say, saying, you invest at the point of maximum fear.

Right. So this takes incredible courage to be rushing in when everyone else is rushing the other way.

Yeah, well, I mean, it's sort of like, what was it? One of those business principles he writes about where all times are good times for those who know how to work and have the means to do so. He's got the cigarette cash, companies are going cheap. So he goes all in while others were getting out, inspired perhaps by his father who had bought out his partner in their general store during another turbulent time in the country's history, the Mexican Revolution. So basically, when all around losing their heads, keep your cool.

Yeah, keep your cool and invest. But at the time, Carlos was actually reassuring his friends. He was saying things like, countries don't go broke. And in a way, that's true. One thing that country can always rely on is it has the ability to tax its population. And that means they can always get money in. Plus, if you own the central bank, you can just get them to print some money. Now, sometimes that can cause inflation, but a sovereign country will always have the financial resources of its citizens to draw upon through the form of tax.

Right. So that phrase, too big to fail, that applies in this case. Well, yeah, a country can't ultimately fail forever. You know, people still need to buy and sell things and people still need to make a living. And that living can be taxed. So a country will always have some resources. So Carlos Slim was experiencing a bit of a bargain basement shopping spree. Yeah. And he was buying dozens of big companies at bargain prices, including General Tire and Renault's aluminum.

And by the end of the 80s, the companies under his conglomerate had revenues of more than $1.5 billion.

So the next big purchase for Carlos is part of a now familiar story for good bad billionaire. This was the big wave of privatisation publicly government owned assets being sold to private markets.

And this was the 90s. So like many governments at the time, then President Carlos Salinas de Gautari began privatizing those industries. He wanted to help kickstart the failing economy. Yeah, he was a controversial figure, President Carlos Salinas. His presidency was marred by scandals. He believed improving Mexico's telecommunications infrastructure could help businesses grow and grow the economy.

Right. And actually much the same way that, you know, China and Africa's telecoms industry were like huge drivers of growth. Yeah, particularly in Africa, because in Africa, for example, they kind of leapfrog telegraph wires and went straight to mobile. And that really accelerated their growth. So telecommunications is like the lifeblood of an economy.

Right. Because you can't really call up a business owner and make a deal if the telephones don't work. And at this time, the national phone monopoly Tel-Mex was in a pretty poor state. It had just five lines for every 100 people. That was half the global average of 10 lines per 100 and 50 lines for every 100 in the USA at that time.

Now when Telmexas privatised in 1990, the sale was the largest privatisation in Latin American history and Carlos won the bid. He put up half of the US$1.8 billion cost and got a controlling 20% stake. He became the biggest shareholder as well as chairman. And upon buying Telmex, he promised a phone in every village and to be fair, he did spend billions on infrastructure. Some did question whether buying a failing telecoms company was a good investment but as one executive said at the time,

It's like selling water in the desert. Within a year of his purchase of Talmec's net profit was up 44%. Which meant that in 1991, Fortune magazine, which does people outside of the US, they listed Carlos Slim as one of just 202 billionaires in the world.

So at the age of 51, Carlos Slim is officially worth $1 billion. He is a billionaire. But he's still a long way off being the richest person in the world, which he became at one point. So how does he get there? But on his way to a billion, let's learn a little bit more about Carlos the person.

Yeah, all the money in the world can't keep you healthy forever, and in 1997 he almost dies. Yeah, at the age of 57 he had a heart valve replaced, it didn't go according to plan. He was briefly declared dead on the operating table after suffering a massive hemorrhage. Yeah, and remember his dad died of a heart attack, and after this health scare, he starts handing over some of the day-to-day running of his empire to his children.

He had six kids with his wife, Simaya. Remember, that's the love of his life, the person for whom his Museum of Art is named after. But in 1999, she died aged 51 from kidney problems. As you say, love of his life, he never remarried. Their wedding photo remains on his desk.

Although he did actually quip to a telegraph reporter back in 2011, the only sports he prepses nowadays is High Boy in Box Spring referring to cocktails and mattresses. Yes, nice. Anyway, most of his children still work in his business empire. They've taken on different aspects and different parts of the conglomerate.

And every Monday, he meets his three sons and two sons-in-law for a home-cooked meal at his house to discuss business. Just kind of reminiscent of LVMH bosses. Oh, yes. Bernardo knows kind of monthly lunches of his kids. I know, and we've remarked at the time on that one, and you can hear that episode in our archive about whether his kids look forward to that meeting. I'm just wondering.

Yeah, you kind of wonder how they look at the great calendar. Oh, great. It's time to go and have dinner with that again. Anyway, his health scare doesn't stop him back on the business story. After buying Telmex, he then bought one of the two main suppliers of the copper cables that Telmex used for telephone wise. That is proper vertical integration.

And then he made sure that Telmecs didn't buy any cables from the other pick supplier. But perhaps the secret to his vast wealth was a little detail of the deal that was done. Remember when he bought Telmecs, the ailing telecoms company back in 1990? There was an extra bit that he bought at the time, which nobody could know how important it was going to be because he had the sellier like the mobile license for the entire country. And just think what that does in the age of the internet and wireless communication.

right because nobody could really predict the rise of the smartphone or the rise of digital communication. So he was sitting on a goldmine which he hadn't previously realised. Now this is huge because by 2001 the cell phone division of Telmetz called America Mobile became a separate company and with the rapid growth of cell phone usage the company absolutely dominated Mexico.

Incredible numbers. By the late 2000s, Tel-Mex controlled over 90% of Mexico's phone lines, and America Mobile controlled over 70% of Mexico's cell phone market. And don't forget, the 2000s are also the time of the dot-com crash, which Carlos took advantage of. So he bought other telecoms companies on the cheap, including AT&T Latin America. Today, America Mobile is Latin America's biggest telecom company, which effectively means, to my mind, that Carlos Slim operates a monopoly on the telecoms market.

Yeah, he's often been accused of being a monopolist, one of the big criticisms that people have of him. And some people say monopolies are very good for the people who own them, but they're not very good for the rest of the economy, because you don't get the kind of competition, the kind of innovation, the kind of, you know, that race to try and be better than the next person, which makes services better and cheaper. You don't get that with monopolies.

And arguably that has knock-on effects for the consumer, right? Because you can basically charge whatever you want, you can provide a bad service, and you don't have a kind of worthwhile competitor to go to to give your money to and say, hey, I'm not having a good time with this other guy. Can you provide me with a better contract? You've got no choice. Like it or lump it. So many argue that Carlos' control of the Mexican telecoms industry slowed down the nation's development.

Yeah, the OECD, that's the Organisation for Economic Cooperation Development, the club of some of the most advanced economies, estimated that it cost Mexicans an extra $13 billion a year between 2005 and 2009, because there was no price competition.

In a 2007 study from the World Bank asserted that public and private monopolies were the main issue for slow economic growth and development of the Mexican economy. In fact, it's one of the worst countries in the world in terms of competitiveness. Well, no wonder if he's got 70% of the telecoms market and he dominates in other areas. And so why was he allowed to have such dominance? Well, you know, he's the country's largest private employer and the biggest taxpayer.

Yeah, when he put it that way, he's got a lot of power indeed. And according to the Wall Street Journal, Mexican Congress routinely killed legislation that threatened his interests. And because his firm's account for a big chunk of the nation's advertising revenue, that makes the media reluctant to criticize him because they live off advertising revenues.

Right. You know, you've got to imagine also that his riches have brought him enormous amounts of political influence. I imagine when you become political leader in Mexico, one of the first people you are invited to meet is Carlos Slim. And though he has a reputation for being a pretty personable guy, when you do meet him, he's known also to have a short temper and to be sensitive around press criticism. We should say that Carlos himself denies his monopolist. I like competition. We need more competition as a quote from him.

Conveniently, however, he also thinks there's no harm in dominating a market if they offer a good service and low prices. In his words, if a beer in Mexico costs one peso and in the US it costs two pesos and I don't see the problem. Yeah, unless in fact, unless one of the competitors could sell it to you for half a peso. So you are still paying double what you might otherwise pay, even if it's half what it is in the US.

a very good point. Now, he denies that his companies charge high prices, despite many analyses suggesting otherwise. He's also told the New Yorker, if society would have told me to get out of business, I would do it. But please ask my critics what they have done for the country, how many jobs have they created?

Oh, how they hate me. That's funny. With the money he was making from his telecoms empire, he invested further into other sectors, construction, mining, oil, broadcasting, airlines, hotels, rail, you name it, he owns it. And by 2007, he controlled more than 200 companies across his portfolio. So in 2007,

Carlos Slim companies made up one third of the $422 billion Mexican stock exchange. You remember when we did Mukesh Ambani and we were talking about the percentage of the stock exchange and this is dwarfed by the dominance of Carlos Slim at 5% of Mexico's gross domestic product. Mukesh Ambani was something like 3% and so he's almost double the size of Mukesh Ambani's grip on the Indian economy.

And you can listen to that episode in our archive. If you recognize the name and Barney, remember, that's the guy who paid for this $600 million wedding featuring, you know, very famous guests, including Beyonce and one Boris Johnson. Anyway, this is the moment when he sneaks ahead of Microsoft founder Bill Gates. He can listen to that episode too. And they vie for the title of world richest person over the next few years.

Now, some people say that the reason why Slim was beating Gates at the top is because Slim, unlike Bill Gates, was rather slow to adopt charity and philanthropy. Yeah, it's worth remembering just how big these numbers are. So he's $59 billion at the age of 67 in the 90s. That means for at least two years, Carlos would be making $27 million a day.

Just for context, by the way, because we're talking about Mexico, a fifth of Mexicans were getting by on less than $2 a day. Incredible inequality. But it wasn't just in Mexico who's spending money. Throughout the 2000s, he pushed beyond Latin America. He purchased some stakes in US businesses. So in a very typical move for Carlos, when the financial crisis hit in 2008, he actually bought a $150 million stake in the Wall Street Bank Citigroup.

Yeah, going back to that thing, invest at the moment of maximum fear and having lived through the financial crisis as a journalist and reporting on it, I can tell you, people thought that the financial world was on the brink of collapse. But did you still hear about Carlos Slim and people like Carlos Slim going around picking up the wreckage? Yeah, people like Warren Buffett bought in and lent some money to Goldman Sachs, for example, so Carlos Slim's buying into city. So this takes incredible courage to be rushing in whenever else is rushing the other way, because banks were going bust left, right and center.

So what does the richest person in the world do with all that money? Besides going a bit of a shopping spree, he buys a newspaper to add to the portfolio. He bought a 7% stake in the New York Times, put $250 million into the company through a six-year loan. And again, this was during the height of the financial crisis where it was pretty hard to borrow money from banks who didn't have any.

And in 2015, he spent another $101 million to buy more shares, bringing his state to 17%. Newspapers are a funny business. They haven't been great investments financially, but they do get you influence and power. Witness right now in the UK, there is a bidding war going on to try and buy the daily telegraph, which is actually a profitable newspaper, which is pretty rare among newspapers. But often they are trophy assets, witness Jeff Bezos buying the Washington Post.

Yes, and one of our other billionaires, Patrick Sunxiang, who's a biotech entrepreneur who is now the billionaire owner of the LA Times. Yeah, so it gets you influence, it gets you control of the narrative. It gets you power, it gets you a direct line to the editor-in-chief who may themselves also be very well connected. And also it gets you a lot of sway with politicians because politicians are very, very sensitive to editorial lines that newspapers will take.

And understandably, when the stakes are this high, you are bound to make some people very angry with the purchase. Now, in fact, a New York Times Mexico correspondent said slim is the consummate monopolist. Does being embroiled in a business culture of back scratching and unseen forces make him a great partner for the times? I don't think so. We've talked a lot about successes. It hasn't always been easy.

Now, in the second half of the 2010s, Carlos actually started slipping down the rich list rankings. Now, this was partly due to, as we mentioned, the rise of the detect bros like Mark Zuckerberg and Jeff Bezos. Also, Latin America is prone as a continent to basically have financial crises from time to time.

And there was a currency depreciation against the dollar. There was a recession in Brazil. Argentina would be in problems. So that can affect the purchasing power of the pesos you're making in Mexico when you translate that into purchasing power in other currencies. And unlike some of our other billionaires like Jeff Bezos and Mark Zuckerberg, he's actually tied quite regionally to Latin America. Yeah. The net result of that is that his fortune is worth less in dollar terms. So that's another reason he starts falling down the list.

Now, one other issue is that when a new government took power in Mexico in 2012, they also brought an anti-monopoly law as designed to increase competition in telecoms. And they were pretty much designed to curb the power of America Mobile. Yeah, a competition consultant said the government's attitude towards his empire was quite a big change. This is the first time Slim does not have a copy of all the keys according to this unknown consultant.

Now under the new law, his company couldn't charge fees to its smaller competitors when their users called into its network, and it has to share its infrastructure like its cell towers. This meant a steep fall in profit for America Mobile over the next few years. But Carlos Fortback, arguing the new laws, forced America Mobile to subsidise its competitors

And in 2017, a Mexico Supreme Court ruled that allowing competitors to use its network free of charge was unconstitutional. Despite this back and forth, having a conglomerate which operates across many industries means you spread the risk so he could weather storms in particular industries and markets pretty well. Now Carlos has repeatedly claimed he's about to retire, but then

suddenly branches out into a new territory, and it's a move that's been compared to the tactics of his hero Genghis Khan, who used to kind of lower his rivals into a false sense of security with tactical retreats before going on the offense. Yeah, and age 84, it doesn't look like he's stopping. In June of this year, he got into the UK telecoms market. He paid £400m for a 3% stake in BT, formerly known as British Telecom, a lot of former monopoly.

And this year was the first time his wealth topped $100 billion according to Forbes, so Carlos is officially a centibillionaire.

But $102 billion these days, sadly, only brings you to number 14 on the list. So he's no longer the richest person in the world. But still, when you're talking about people who earn hundreds and hundreds of billion dollars, number 14 isn't too bad a place to land at. OK, so we're going to judge him. He's 84 years old. He's worth $102 billion. Let's assess him in our categories.

So we assess all our billionaires according to different metrics. Wealth rags to riches. How far have they traveled to their wealth? Levels of villainy and we rank them from zero to a 10. So let's start with wealth. How much is Carlos Slim worth? 102 billion. He was richest man in the wealth of many years. Out of 10, I'm going to give him a very solid nine, particularly because he comes from one of the poorer countries in the world.

I'm actually not going to give him his higher ranking because part of how we judge this category is how they spend it and he's not exactly a lavish spender. So apparently for decades he didn't own any houses outside of Mexico and he still lives in this unpretentious house in Mexico City. Like Warren Buffett lives in the same house he's had since the 1950s in Omaha.

Yeah, I mean, I feel like his palate is probably a little bit more adventurous than Warren Buffett. Warren Buffett, famously big lover of McDonald's. I kind of feel like maybe Carlos Slim has slightly more elevated taste than that. I'm still going to give him a nine simply because of the wealth relative to his country. For example,

In 2007, his wealth was 6% of Mexico's entire national income. Now, if Bill Gates were to have a similar chunk in the United States, he would have to be worth $784 billion rather than the actual $59 billion that Carlos Slim was worth back in 2007.

Still, I feel like if you want to make it in the world stakes for me, you've got to spend like a billion years. You like to see the cash flash, don't you? I like to see the cash flash. I want to see submarines with missile detection systems, you know, super car collection. So I'm going to give him a modest seven out of 10. OK, nine for me, seven for you. Rags to riches. How far has he come? Well, it's an interesting one because his family comes from pretty humble origins as, you know, Lebanese immigrants to Mexico.

But by the time Carlos was born into the family, they were doing quite well. Basically, a pretty solidly successful business person, teaching him the ropes, giving him some advice on how to get ahead. But he did get very, very rich. So I'm going to give him a six. And in the country, I guess, where getting very, very rich was actually quite rare at the time. Yeah. Six for me.

I would say six for me as well. You know, he's done pretty well for himself. OK, so villainy, have his monopolies damaged Mexico? Yes, according to some, an Oxfam report, for example, said that extreme wealth inequality in Mexico continues to grow. The total wealth of Mexico's 14 ultra-rich individuals has doubled since the start of the COVID pandemic. In particular, that of Carlos Slim writes Oxfam, the richest man on the continent, has as much wealth as around 64 million Mexicans.

And as we said earlier on the monopoly question, the OECD reckoned that between 2005 and 2009, his monopoly of telecommunications cost Mexicans $13 billion a year.

Oh, that is a lot of money. And also the environmental costs of his business. You know, he's been called out for businesses in oil and mining. You know, his company actually won a $774 million contract on a Maya train project, which has caused serious environmental damage. So apparently,

legal complaints were filed by groups living along the route trying to stop the railway's progress. Yeah, and the Guardian newspaper named him as a top carbon emitter alongside 11 other billionaires, including Jeff Bezos and Roman Abramovich. You can listen to those episodes on our archive. And they went on 12 of the world's wealthiest billionaires produce more greenhouse gas emissions from their yachts, private jets, mansions and financial investments than the annual energy emissions of 2 million homes. I mean, it's amazing that Carlos Slim has kept such a

clean profile, given the fact that Mexico is often racked with organized crime, violence, drug trafficking, etc. He seems to have risen to the top, the very top of the economic tree, without any of that tainting his international reputation. Especially going through several decades, right? He's kind of sat pretty and made money continuously throughout the years. It's an incredible survivor. On villainy, I'm going to say that monopolism is bad for a developing country.

America decided monopolies were bad. That's why you have something called the anti-trust laws, which are competition laws because they wanted to break these big steel trusts, banking trusts, railroad trusts because they realised they were holding America's development back. So it was a monopolist, I'm going to say that that's villainy. So I'm going to give him an eight on that basis.

I mean, for you, the reason why he's villainous is the monopoly aspect. I would say for me, the environmental aspect is kind of what tips it over for me. I think that it seems incredible that he's one of the billionaires who are producing the energy emissions of two million homes. That seems wild to me. I'm going to give him an eight on villainy for his monopolistic tendencies, and you're going to give him

I'll give them an A2 for different reasons. Okay. Let us then talk about philanthropy. How much of your villainy can you absolve through your philanthropy?

So on karloslim.com, there's a rather long quote from Bill Clinton that begins with, Carlos Slim is one of the world's most important philanthropists and most people have never heard about his humanitarian activities. So let's talk about them now. Okay, he does donate billions to various charities from education to health. Although many have argued that he doesn't give enough, given the poverty and Mexico and how ubiquitous his companies are. If you can't step up your front door without giving Carlos Slim some money.

Now interestingly he's been publicly skeptical about whether money spent on philanthropy is actually worthwhile. Back in 2007 he said he had no intention of going around like Santa Claus giving away his money. And at the time when he was the richest person in the world he was actually openly critical of the giving pledge started by Bill Gates and Warren Buffett to give away half your money in your lifetime.

He said charity doesn't solve poverty. How much charity has been done in the past years, trillions of dollars? Instead, he argued, many of the problems will be solved by business activity and development. But presumably his business activity and his development. Not so much of that of his competitors. Well, funnily you should mention that, because he said, wealth is like an orchard. You have to share the fruit, not the trees.

And he liked to own the trees. Yeah, he liked to own the trees and any trees that want to be planted. I'm sorry, you're not coming into the orchard. So I don't know what to think about philanthropy. He's given away a lot of money. Are they skeptical about how much good it does? So I'm going to do a straight down the middle, give it a four maybe.

Yeah, I would say a four out of ten. So, okay, four from both of us on philanthropy. Power. In 2018, Forbes ranked Carlos the 20th most powerful person in the world. Now, understandably, given that Bill Clinton wrote a four word for his website, he's also been known to host Clinton at his home.

Yeah, he's had a turbulent relationship with Donald Trump, and Donald Trump, of course, had a turbulent relationship with Mexico and Mexicans. In 2015, Carlos' TV production studio scrapped a TV deal with Trump after Trump said, remember this, some Mexicans crossing the border into the United States were rapists. Yeah, Trump once described Carlos Slim as the string pulling manipulator who orchestrated the media conspiracy to defeat his election campaign.

Two years later, however, Carlos offered to help Mexico negotiate with Trump and he actually praised Trump's negotiation skills and said Trump would create positive change for those in Mexico. So a very weird relationship. Denise Dresser, a Mexican academic who won a journalism prize in 2009 for an open letter she wrote to the billionaire. It says, past presidents made, I'd say, feeble attempts to regulate Carlos Slim, but they created a monster so big it's very hard to domesticate him at this point.

Wow, so sounds as if Mexico has a very turbulent relationship indeed with Carlos Slim. So power, I would say in Mexico. In Mexico, it's a 10. Yeah. I mean, he's the most powerful person in Mexico, probably more powerful than the president. I mean, imagine if Rupert Murdoch owned important companies across every single kind of industry in the UK and you get someone like Carlos Slim. Yeah. Within Mexico, he's a 10.

And Mexico is one of the world's most important developing economies. I'm going to give him an eight for worldwide power. Right. I'm going to go with an average. So 10 in Mexico, eight for worldwide power. So I think he's a nine out of 10 for me. Yeah. I imagine if you get elected to lead Mexico, one of the first people you call is Carlos Slim. Yeah. Okay. So you're giving him an eight. You're giving him a nine on power and then legacy. How will people remember him? What will he leave behind?

Well, interestingly, when Carlos was asked if money motivated him, he said, the truth is, when I pass away, I will not take one cent with me. In my opinion, wealth is a responsibility and in some ways a compromise. You must keep it growing and use it to society's benefit.

New York Times editorial board member Eduardo Porter wrote, it takes about nine of the captains of industry and finance of the 19th and early 20th century to replicate the footprint that Mr. Slim has left on Mexico. So he's talking about people like Rockefeller, Vanderbilt, Astor, Carnegie. So Carlos Slim's impact on Mexico is bigger than a bunch of those combineds. That's quite a legacy.

Yeah, and in fact, if you go to Mexico City now and you wander around central historical, that entire district has been completely cleaned up, that historic old town by Carlos Slim, because it was once full of all these crumbling buildings, it was a real kind of hotbed for crime.

And walking through it, it's hard to imagine it ever was like that. It's now beautiful, vibrant, completely well-preserved. Yeah, it's a tricky one, isn't it? Because he's become vastly rich. And he would say he's taken Mexico with him. Do you know what I mean? I think he would argue that he's tried to do good things for his country. He's pulled the country up alongside his own vast increase in wealth.

And not many of our billionaires can say that they've done that for the country they were born in. Some billionaires like Ambani, yes. But if you say Jeff Bezos or Mark Zuckerberg, you've left a huge impact on the world. But on America, did you pull up America from being a pretty developing nation? No, you can't really say that. But Carlos Slim can say that for Mexico.

Okay, so I mean, legacy within Mexico, he'll probably be one of the most famous people ever. He'll be like Rockefeller in the US, won't he? I mean, he'll be member for generations as being the rich guy. So I think, again, in Mexico, I'd give him a nine least for legacy. So yeah, will he be remembered in the rest of the world? Not so much. So overall, I'm going to give him a seven for legacy.

Oh, so nine in Mexico is seven internationally. What's that divided by two? Eight. Eight. I think an eight out of ten works for me. Split the difference. Split the difference. And then we've got to decide, this is always the hardest pit, whether he's good, bad, or just another billionaire.

Oh, it's difficult, isn't it? I mean, I did rank him quite high on villainy. Yeah. I'm going to say he's marginally bad. I think he probably has done great things for Mexico. He's being described as incredibly competent. But because of his monopolistic tendencies, which I'm convinced is bad for a country, I'm going to say he's just shades into the bad territory.

I think when you think about the level of inequality in Mexico, and you know, putting aside the billions he's done philanthropically, it clearly hasn't really made a dent on inequality in Mexico, and he's become this real symbol of the gap between the rich and the poor, something that's only really expanding. Oh, it took you on this. Do you blame the rich people for inequality? Do you know what I mean? Is it the people who get rich's fault that there's inequality, or is it the way the society is organised?

But then when the rich people are engaging in business practices like you point out of monopolies and strangling competition, and actually some might argue costing people money out of their pocket because they excess such a monopoly on their daily life, then I think, yeah, I think you have to say that. That's a good argument. OK. Or like I say, he wanders into bad territory for me. So, Carlos Slim, you are, sadly, a bad billionaire. I'm sure he'll be gutted.

So who do we have on the next episode? We have a woman who spotted a gap in the market, a gap between generations, and named a company after it. Her name is Doris Fisher, and she, with her husband Don, founded the clothing giant, The Gap, which was born in the summer of love, faded in the 1980s, was totally dominant in the 1990s. And we'll update the story to tell you how she made a billion from that.

Good Bad Billionate was produced by Hannah Hufford and Louise Morris with additional production support from Emma Betteridge. James Cook is the editor and it's a BBC Studios production for BBC World Service. For the BBC World Service and the podcast commissioning editor is John Manel.