Thoughts about wealth

Is wealth really a good thing? Or rather, is wealth really necessary? I suppose in the capitalist system that we’ve set up it’s necessary. But overall, is wealth essential to the advancement of society? I would argue that the very idea of wealth is entirely unnecessary and even disadvantageous in certain ways.

I first started thinking about this while talking with a good friend about economic policy. As any good capitalist will tell you, wealth is an incentive. And indeed, that is the current paradigm. We go to work to earn a paycheck, people invest to turn a profit, and corporations are responsible for generating increasing amounts of wealth for shareholders. When I stopped and thought about this, the idea of wealth as an incentive left a rather sour taste in my mouth. So we invest, create, and innovate to be rewarded with money, with the promise of being wealthy? Isn’t that the same logic that a dog uses when it does a trick on command for a biscuit?

And then I started thinking about what being “rich” really means. Becoming wealthy is part of the American dream, isn’t it? We extoll the rich, put them on pedestals, admire their wealth, and look at them as the paragons of success. But ultimately, why is being rich good? What good does being wealthy do for the individual? The more I thought about it, the more I wondered what the point of having more money than you can spend is. The only thing I could think of is giving away most of it to charity–at which point I’d have to ask what was the point of being wealthy at all?

In my opinion, the idea of wealth speaks to our advancement (or lack thereof) as individuals and as a species. I understand why some people feel a need for wealth, for the accumulation of things. From an evolutionary standpoint, such behavior was once advantageous to survival. Early man had to stockpile things of value–namely food–because he could never be sure when he would eat next. As time goes on and technology advances, it makes sense that man would be preoccupied with acquiring land–the means of producing food, of having water, etc. On a very basic biological level, having wealth could attract potential mates, since it indicates a better chance of survival.

But do we really need that current paradigm? A squirrel spends most of its time collecting and hiding nuts–more nuts than it could ever eat–because that’s its survival strategy. Other animals will find and eat the nuts, so it needs to collect more than it needs to make up for the losses. But really, aren’t most rich people essentially acting like squirrels? Spending the majority of their lives collecting money–more money than they’ll ever be able to spend–and hiding it in offshore accounts, dummy corporations, and other tax shelters?

And I think that’s what sticks out the most to me–wealth is an outdated concept. It’s not necessary at this point in civilization. It’s an anachronism. It appeals to ancestral parts of our brain that we no longer need to use. I would think–hope, even–that at this point in the development of mankind that we wouldn’t need to be financially motivated to do things anymore. That the incentive to do things would be the betterment of communities, society, and civilization as a whole. Dr. Jonas Salk refused to patent the polio vaccine–a move that would have made him super wealthy–because he believed that things like that belonged to all mankind. Where has that line of thinking gone?

It’s still out there, obviously. I’m not trying to argue that philanthropists don’t exist. Of course they do. But they’re eclipsed by the Donald Trumps of the world, and by the millions and billions of people who see wealth in the movies, on TV, etc and aspire to it for no other reason than to simply have things, material possessions. People who have been sold the notion that having wealth increases happiness. And to a certain degree they’re right. Studies have shown that happiness does indeed increase as income increases…but only up to a certain point. And that number is nowhere close to what most people would think. It’s not in the billions, or the millions, or even the hundreds of thousands. It’s about $75k/year. That’s the magic number, folks. That’s the number that researchers and individuals have identified as what it takes to be happy. To be secure, to be able to provide for a family, and to be able to pursue interests and hobbies.

Ultimately the wealth-as-happiness idea doesn’t serve anyone, because as long as everyone is competing for wealth, there will be losers. And the more people accumulate wealth, the less there is for everyone else. It’s a zero sum game. And before you argue that it isn’t, practically speaking it is. We’re capable of generating new wealth–but who do you think gets the bulk of that new wealth? That’s right–the people who are already wealthy. Not the poor folk at the bottom.

We’re at a point in history right now where our civilization is at a crossroads. There is enough money, enough wealth in the world right now, to give every adult person in the world $49,000/year. So a family with two parents or adults in the household would be making $98,000/year, which is well above that magic $75,000 mark. I can already hear people crying out at their monitors, “BUT IF WE TAKE AWAY MONEY WHY WILL PEOPLE GO TO WORK?!” My answer to that is that’s flawed reasoning from the get-go, and a way of looking at things that’s outdated and unnecessary.

Imagine a system whereby tomorrow morning at 9:00 am all of the wealth in the world–about $223 trillion US dollars by current estimates–was redistributed to the figures I listed above. Imagine a world where instead of being motivated by some temporary financial incentive, like the dog is motivated by a treat, people were motivated by intellectual curiosity, by a sense of exploration, by the pursuit of knowledge and the betterment of society. Imagine a world where people didn’t need to have 8 children because they could afford access to medical care, providing them with contraception, and because they had better access to education. The population would plateau (and maybe even dip a little), while the amount of wealth driven by production and innovation would only increase–thereby increasing everyone’s share of the pie. Instead of being siloed into the “me-me-me” mentality of material wealth, people would start thinking about each other, and what benefits everyone–not just their profit margins.

Sounds fanciful, I know. But really, the only thing that has stopped us from organizing the planet in such a way is ourselves. There’s no rule about how we have to set up our economy, our societies, and our incentives–we just make that shit up. And in the past, people made it up out of the survival instincts of our ancestors. But culture changes, values change. Personally, I hope they shift away from the egocentric philosophies to which material wealth speaks.

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5 thoughts on “Thoughts about wealth

  1. As always I enjoy your posts Ryan. I too dream of this type of society. Sort of like the one from Star Trek, which is perhaps the reason I love the show. It’s sort of nerd food. A civilization who thrives on exploration and discovery.

    I am going throw a couple of wrenches into this plan, and it’s not because I like being a Debbie Downer, but actually because I have thought about this before and I don’t know how to get around these wrenches, so perhaps you can help.

    The first one is evolutionary. Civilization is certainly not a plan of evolution, ultimately all life actually requires is survival and reproduction. Everything else is just bonus, and it is a wonderful bonus that makes me so happy we cast aside our lives in the wild. There is a part of us that wants to be safe and once we feel we are safe and secure our brains are going to be like….”what now?” Now in this new world it will be great that all of us are getting this awesome education to do scientific investigations, create art, run a restaurant, whatever, however there still has to be people who pick up trash, clean buildings, fix roads, mine coal, spend all days on an assembly line, pick fruit, etc. Most jobs in the world are fairly mindless, labor intensive, and not a whole lot of fun. Who does these jobs in a new society. Especially if they have a good family income, are getting a good education. Everybody at the university loves their job and was happy to have students come for free and teach them. That’s fine…but now Mr. Graduate you need to go out there and clean bathrooms at the train station all your life. Well because someone has to do that. Your needs will be met, but because you live in a society that values education you now get to realize your full potential. But the down side is you still have to clean toilets. Is the fact that all your basic needs are being met, you have a house and can get your kid a bicycle for Christmas enough of a satisfaction that makes cleaning toilets in a train station seem worth while? Maybe it is, I am not sure. But I suspect that we wouldn’t have enough people to do those jobs. Arguably sanitation is extremely important and leads to a better society, but if I have a choice, I’d probably choose to do something else to better society.

    The second wrench is about supply and demand. Maybe I’m a manufacturer. Let’s say I make these really sharp awesome knives made of titanium. There isn’t much titanium, it’s hard to mine. But let’s say everybody from the miners to smelters to the assembly line workers love their job. And because I’m not greedy I don’t even have a patent, I just love making good knives for people. Eventually I am going to run out of supply…or this is just a physical limit to how many I can make a year. Knives are a pretty useful tool and so who wouldn’t want the best knife possible? Especially since the knife is free. And it’s not that they are even being greedy and hording knives, they just want one. With 300 million people I need to make a knife every 0.1 seconds in an entire year to just give everybody a knife. Obviously this isn’t possible. So there are always going to some people who have and those who don’t. This disparity will either force me to come up with some system where I get something in return in trade for preference on who gets the knives first, or the general population competes amongst themselves to try and outbid each other. We after all naturally competitive. I may try to be further egalitarian and share my knife design with other manufacturers. But even then there are only so many titanium deposits even if we all do work together to mine it. Not to mention if I am trying to be fair about things then I have to keep a census on who has a knife and who doesn’t? By the time I have all these knives made, more people are born and are at an age where they need a knife. What about the people who had a knife but lost it and need a replacement? Will those that didn’t get a knife try to steal knives from other people that have one? Ultimately any resource is finite and so this sets up a list of goods that are somewhat better or somewhat worse. It creates disparity in wealth, even if we are all making the same amount of money. Cheap knife makers know their knives suck, but they sell them at a low price. Also in this society there are probably going to be people who love to sell and market things. They might try to push a lesser knife as equal to mine, and thus charge as much, fooling people into thinking they are getting a great knife. When their knife dulls or breaks quickly, all of a sudden people are out of some of that 98,000 they make with a broken knife and have to buy another one.

    Anyway, sorry for the long post, but I guess this awesome society that both of us wants boils down to two main problems for me. How do we get everyone to enjoy their job? And is it possible to not have disparity between people despite everyone having an equal income?

    1. Very interesting questions, and I can only respond to them in brief, but I’ll follow up with more later.

      My first thoughts about the disparity idea is that even of they still existed, teu wouldn’t matter. The key to any disparities is that it’s a *perceived* inequality. But so long as people’s basic needs were met (or even exceeded), and they were free to pursue their own passions and interests, would people even care about disparities in material goods?

    2. To throw it back to Star Trek, a reporter once asked Roddenberry about Picard being bald, “wouldn’t they have cured baldness by the 24th century?”

      Roddenberry’s famous retort was, “By the 24th century nobody would care about baldness anymore.”

      Humorous, but I think this is demonstrative of the kind of cultural evolution that would need to occur for the new type of society we are talking about to success.

  2. Haha…I agree with Roddenberry…I think we are already seeing that as some people simply like how they look bald and so why should anybody care.

    Using knives was just one possible example…you could extend it to many other things and some material goods are important not all of them are luxury items. The reason I used a titanium knife is because I wanted to use a metal that was long lasting, low maintenance and tough. In the current society we live in some things that are necessary and of quality are more costly. Partly because of the skill and materials they use. After all it would also be nice to not live in a throw away society and actually build things to last instead of the consumerist approach where you have to buy things anew every few years. But I agree that in theory we shouldn’t mind the disparity so much. Perhaps it is the idea of wealth that prevents us from truly enjoying what we have. When I went to India to visit my dad’s side of the family…we always found the poorer families more welcoming and friendly than the richer ones. Quite likely because they knew they couldn’t change their financial position much and pursued other things in life to bring them happiness. But I am sure it is more complicated than that. There has to be a catalyst for this cultural revolution…what would it be?

  3. I think that, ultimately, time is the only thing that can provide such a catalyst. The industrial revolution that birthed the modern world and capitalism as we know it today is less than 200 years old. I think, as with any relationship, the so-called honeymoon phase of our relationship with wealth and capitalism will eventually wear off, and we’ll be left staring at it all without the rose colored glasses.

    I also think that we’re just now becoming far enough removed from the starting point to begin to see that the honeymoon phase is ending. Since the industrial revolution is barely a memory, there really have only been a few generations who have lived through the system. As a result, I think that we’re just now beginning to see a disconnect, since it’s been long enough for patterns and trends to emerge.

    For example, I know that a lot of people my age look at our parent’s generation, and we see a lot of things that we don’t like, but were the paradigm several decades ago. A lot of my peers saw our parents essentially enter corporate slavery–they spent the majority of their lives working as a faceless cog in the gears of a company that didn’t hesitate to drop them like a sack of bricks for the sake of cutting costs. We saw them enter into mortgages that take entire lifetimes to pay. We saw retirement accounts that took a lifetime to accrue vanish overnight because of shady practices and bad investments. Mind you, all the while this is happening somehow the CEOs and investors that caused the economic collapse managed to keep their jobs and somehow increased their pay and bonuses.

    On a systems level, we’ve seen decades of wealth redistribution from the bottom to the top, under the faulty premise that giving the wealthy more money would translate into more jobs. We’ve seen a system perverted by money, where whoever has the most money has the loudest voice.

    In short, we’ve experienced more wealth than at any other point in history as a society, but as individuals we are hard pressed to find the benefit in that. We’re looking around at all of the money and wealth in the system, seeing how it’s abused, and scratching our heads, asking what’s the point of it all? Why should I spend all of my life working so that someone else can get rich and not have to work? Why should I spend more time at a thankless job than with my family?

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