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The Value Of Wealth
Submitted by Raul Ilargi Meijer via The Automatic Earth blog,
We need to do a lot more thinking, and take a far more critical look at ourselves, than we do at present. We’re not even playing it safe, we’re only playing it easy. And that’s just not enough. The marches in Paris and numerous other cities today were attended by people who mean well, but who should ask themselves if they want to be part of what was predictably turned into a propaganda event by ‘world leaders’. One thing is for sure; the murdered Charlie Hebdo staff would not have approved of it.
The leaders hark back to usual suspect slogans like we defend ‘Liberty’, ‘Freedom of Expression’ and ‘Our Values’. But we can’t turn our backs on the fact that ‘our values’ these days include torture and other fine ‘tactics’ that make people in other parts of the world turn their backs on us. We might want – need – to march to express our feelings about torture executed in our name, as much as to express our horror at cartoonists we never heard of being the target of automatic weapons.
There are major armed conflicts going on in 6 different Arab countries, and ‘we’ play a part in all of them. We get up in the morning and prepare to march against violence in our own streets, but we should perhaps – also – protest the violence committed in our name on other people’s streets just as much. We may feel innocent as we’re marching, but that’s simply because we refuse to look at ourselves in the mirror. And we must be able to do better than that. Both to be the best we can be (which is still a valid goal), and to prevent future attacks.
And that’s not nearly the entire story. Our governments play ‘divide and rule’ both domestically and abroad. They play nations against each other in far away parts of the globe, and poor vs rich and generation vs generation at home. If you want a better world, don’t look at your leaders to make that happen. They like the world the way it is; it got them where they are. Moreover, they’re all beholden to numerous supra-national organizations that are the real power behind the throne across the globe; NATO, IMF, EU, World Bank et al.
If you want a better world, and one in which the risk of attacks like the one this week goes down, you’ll have to look at yourself first, and take it from there. Marching in a mostly self-righteous parade in which the wrong people form the first line is not going to do it. You’re not going to solve this sitting on your couch. Our world is not just financially bankrupt, and in deep debt to boot, it’s also about as morally broke as can be.
We therefore have to rethink our world just about from scratch. Or else. We’ve lived chasing the recovery carrot for years now, but the economy won’t recover; it can’t. There hasn’t been any real growth since at least the 1980s, the only thing there’s been is increasing debt levels that we mistook for growth.
A great first example of how to do this rethinking was provided late last year, and I referred to it before, by UofM Amherst economics professor James K. Boyce:
Imagine that without major new investments in adaptation, climate change will cause world incomes to fall in the next two decades by 25% across the board, with everyone’s income going down, from the poorest farmworker in Bangladesh to the wealthiest real estate baron in Manhattan. Adaptation can cushion some but not all of these losses. What should be our priority: reduce losses for the farmworker or the baron? For the farmworker, and a billion others in the world who live on about $1 a day, this 25% income loss will be a disaster, perhaps the difference between life and death.
Yet in dollars, the loss is just 25 cents a day. For the land baron and other “one-percenters” in the U.S. with average incomes of about $2,000 a day, the 25% income loss would be a matter of regret, not survival. He’ll find a way to get by on $1,500 a day. In human terms, the baron’s loss pales compared with that of the farmworker. But in dollar terms, it’s 2,000 times larger. Conventional economic models would prescribe spending more to protect the barons than the farmworkers of the world.
It’s how we think. Boyce describes it perfectly. We chase money, no questions asked, and even call it no. 1. And unless we change the way we think, one Manhattan land baron will be saved, and 1000 Bangla Deshi farmers and their entire families will either drown or be forced higher inland, where there are already too many people just like them. A dollar or a person. Our present economic models know which one to choose. But we should have more than mere economic models guide us.
Michael Lewis – yes, him – provides another wonderful example in the New Republic. I tried to make the quote as short as I could, but, hey, Lewis is .. Lewis. The original title was ‘Extreme Wealth Is Bad for Everyone – Especially the Wealthy’ (Getting rich won’t make you happy. But it will make you more selfish and dishonest). The Week turned in into this:
When I was 14, I met a man with a talent for restoring a sense of fairness to a society with vast and growing inequalities in wealth. His name was Jack Kenney, and he’d created a tennis camp, called Tamarack, in the mountains of northern New Hampshire. The kids who went to the Tamarack Tennis Camp mostly came from well-to-do East Coast families, but the camp itself didn’t feel like a rich person’s place: It wasn’t unusual for the local health inspectors to warn the camp about its conditions, or for the mother of some Boston Brahmin dropping her child off, and seeing where he would sleep and eat for the next month, to burst into tears.
Kenney himself had enjoyed a brief, exotic career as a professional tennis player — he’d even played a doubles match on ice with Fred Perry – but he was pushing 60 and had long since abandoned whatever interest he’d had in fame and fortune. He ran his tennis camp less as a factory for future champions than as an antidote to American materialism – and also to the idea that a person could be at once successful and selfish.
Jack Kenney’s assault on teenaged American inequality began at breakfast the first morning. The bell clanged early, and the kids all rolled out of their old stained bunk beds, scratched their fresh mosquito bites, and crawled to the dining hall. On each table were small boxes of cereal, enough for each kid to have one box, but not enough that everyone could have the brand of cereal he wanted. There were Froot Loops and Cheerios, but also more than a few boxes of the deadly dark bran stuff consumed willingly only by old people suffering from constipation.
On the second morning, when the breakfast bell clanged, a mad footrace ensued. Kids sprung from their bunks and shot from cabins in the New Hampshire woods to the dining hall. The winners got the Froot Loops, the losers a laxative. By the third morning, it was clear that, in the race to the Froot Loops, some kids had a natural advantage. They were bigger and faster; or their cabins were closer to the dining hall; or they just had that special knack some people have for getting whatever they want. Some kids would always get the Froot Loops, and others would always get the laxative. Life was now officially unfair.
After that third breakfast, Kenney called an assembly on a hill overlooking a tennis court. He was unkempt and a bit odd; wisps of gray hair crossed his forehead, and he looked as if he hadn’t bathed in a week. He was also kind and gentle and funny, and kids instantly sensed that he was worth listening to and wanted to hear what he had to say.
“You all live in important places surrounded by important people,” he’d begin. “When I’m in the big city, I never understand the faces of the people, especially the people who want to be successful. They look so worried! So unsatisfied!” Here his eyes closed shut and his hands became lobster claws, pinching and grasping the air in front of him. “In the city you see people grasping, grasping, grasping. Taking, taking, taking. And it must be so hard! To be always grasping-grasping, and taking-taking. But no matter how much they have, they never have enough. They’re still worried. About what they don’t have. They’re always empty.”
“You have a choice. You don’t realize it, but you have a choice. You can be a giver or you can be a taker. You can get filled up or empty. You make that choice every day. You make that choice at breakfast when you rush to grab the cereal you want so others can’t have what they want.”
On the fourth morning, no one ate the Froot Loops. Kids were thrusting the colorful boxes at each other and leaping on the constipation cereal like war heroes jumping on hand grenades. In a stroke, the texture of life in this tennis camp had changed, from a chapter out of Lord of the Flies to the feeling between the lines of Walden. Even the most fantastically selfish kids did what they could to contribute to the general welfare of the place, and there was not a shred of doubt that everyone felt happier for it. The distinction between haves and have-nots, winners and losers, wasn’t entirely gone, of course. But it became less important than this other distinction, between the givers and the takers.
So far for the Jack Kenney story. Michael Lewis continues:
What is clear about rich people and their money — and becoming ever clearer — is how it changes them. A body of quirky but persuasive research has sought to understand the effects of wealth and privilege on human behavior — and any future book about the nature of billionaires would do well to consult it.
One especially fertile source is the University of California at Berkeley psychology department lab overseen by a professor named Dacher Keltner. In one study, Keltner and his colleague Paul Piff installed note takers and cameras at city street intersections with four-way Stop signs. The people driving expensive cars were four times more likely to cut in front of other drivers than drivers of cheap cars.
The researchers then followed the drivers to the city’s crosswalks and positioned themselves as pedestrians, waiting to cross the street. The drivers in the cheap cars all respected the pedestrians’ right of way. The drivers in the expensive cars ignored the pedestrians 46.2% of the time – a finding that was replicated in spirit by another team of researchers in Manhattan, who found drivers of expensive cars were far more likely to double-park.
In yet another study, the Berkeley researchers invited a cross section of the population into their lab and marched them through a series of tasks. Upon leaving the laboratory testing room, the subjects passed a big jar of candy. The richer the person, the more likely he was to reach in and take candy from the jar — and ignore the big sign on the jar that said the candy was for the children who passed through the department.
Maybe my favorite study done by the Berkeley team rigged a game with cash prizes in favor of one of the players, and then showed how that person, as he grows richer, becomes more likely to cheat. In his forthcoming book on power, Keltner contemplates his findings:
If I have $100,000 in my bank account, winning $50 alters my personal wealth in trivial fashion. It just isn’t that big of a deal. If I have $84 in my bank account, winning $50 not only changes my personal wealth significantly, it matters in terms of the quality of my life — the extra $50 changes what bill I might be able to pay, what I might put in my refrigerator at the end of the month, the kind of date I would go out on, or whether or not I could buy a beer for a friend. The value of winning $50 is greater for the poor, and, by implication, the incentive for lying in our study greater. Yet it was our wealthy participants who were far more likely to lie for the chance of winning fifty bucks.
There is plenty more like this to be found, if you look for it. A team of researchers at the New York State Psychiatric Institute surveyed 43,000 Americans and found that, by some wide margin, the rich were more likely to shoplift than the poor. Another study, by a coalition of nonprofits called the Independent Sector, revealed that people with incomes below 25 grand give away, on average, 4.2% of their income, while those earning more than 150 grand a year give away only 2.7%. A UCLA neuroscientist named Keely Muscatell has published an interesting paper showing that wealth quiets the nerves in the brain associated with empathy.
If you show rich people and poor people pictures of kids with cancer, the poor people’s brains exhibit a great deal more activity than the rich people’s. “As you move up the class ladder,” says Keltner, “you are more likely to violate the rules of the road, to lie, to cheat, to take candy from kids, to shoplift, and to be tightfisted in giving to others. Straightforward economic analyses have trouble making sense of this pattern of results.”
But that wouldn’t work, you think? Not for you, not in today’s world, and certainly not for the political class? Well, we happen to have the example of a real life president of a nation who questions all we tend to think is ‘normal’. Back in October, HuffPo had this portrait of Uruguayan President José Mujica. And please see this against the backdrop of US presidential candidates raising hundreds of millions of dollars even just for their preliminary campaigns.
Mujica says what I often have, that money should be kept out of a political system, because if it isn’t it will end up buying and eating that system whole. Too late for the US and Europe, but perhaps not for Uruguay.
‘World’s Poorest President’ Explains Why We Should Kick Rich People Out Of Politics
People who like money too much ought to be kicked out of politics, Uruguayan President José Mujica told CNN en Español [..] “We invented this thing called representative democracy, where we say the majority is who decides,” Mujica said in the interview. “So it seems to me that we [heads of state] should live like the majority and not like the minority.” Dubbed the “World’s Poorest President” in a widely circulated BBC piece from 2012, Mujica reportedly donates 90% of his salary to charity.
Mujica’s example offers a strong contrast to the United States, where in politics the median member of Congress is worth more than $1 million and corporations have many of the same rights as individuals when it comes to donating to political campaigns. “The red carpet, people who play – those things,” Mujica said, mimicking a person playing a cornet. “All those things are feudal leftovers. And the staff that surrounds the president are like the old court.”
“I’m not against people who have money, who like money, who go crazy for money,” Mujica said. “But in politics we have to separate them. We have to run people who love money too much out of politics, they’re a danger in politics… People who love money should dedicate themselves to industry, to commerce, to multiply wealth. But politics is the struggle for the happiness of all.”
Asked why rich people make bad representatives of poor people, Mujica said: “They tend to view the world through their perspective, which is the perspective of money. Even when operating with good intentions, the perspective they have of the world, of life, of their decisions, is informed by wealth. If we live in a world where the majority is supposed to govern, we have to try to root our perspective in that of the majority, not the minority.”
“I’m an enemy of consumerism. Because of this hyperconsumerism, we’re forgetting about fundamental things and wasting human strength on frivolities that have little to do with human happiness.”
He lives on a small farm on the outskirts of the capital of Montevideo with his wife, Uruguayan Sen. Lucia Topolansky and their three-legged dog Manuela. He says he rejects materialism because it would rob him of the time he uses to enjoy his passions, like tending to his flower farm and working outside. “I don’t have the hands of a president,” Mujica told CNN. “They’re kind of mangled.”
Mujica is the kind of man, make that human being, who should be in charge of all countries. Money and politics don’t mix, or at least not in a democracy. And I don’t see any exceptions to that rule. Mujica is right: if and when the majority of people in a country are poor, which is true just about everywhere, and certainly in the Anglo world and most EU countries, then their president should be poor too.
And inevitably, if you would follow the example of your president, so should his people. Not dirt poor, not starving, just being content with basic necessities for you and your family. And then tend to your flower farm, or your vegetable farm, your kids.
Sounds stupid. I know. But we haven’t had any real growth in decades, and the wizard’s curtain is being lifted on the fake growth we did have since too. So maybe the economy’s not all that cyclical after all, or maybe the cycles are longer than we would like, Kondratieff 70 year like. Or even longer.
Ask anyone if they would like to have $1000, or $10,000 or $1 million or more, and you know that the answer would be. But Michael Lewis shows that none of it would make you any happier, if you already have – or make – enough to survive on. Still, it’s generally accepted that more is always good.
And then you have the president of Uruguay, admittedly a small country and in South America to boot, who says that only poor people can truly represent poor people, who will always be in the majority in whichever country you may live in, and that that is the core of democracy.
Here’s thinking we are absolutely clueless when it comes to the value of wealth, and that we keep chasing more of it because we’re not smart enough to recognize that value. And that that’s why we have torture and wars and all the other things that make us so ugly. We have absolutely no clue what the value of wealth is. And as long as we don’t, we shouldn’t have any.
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"There hasn’t been any real growth since at least the 1980s, the only thing there’s been is increasing debt levels that we mistook for growth."
Folks... we wouldn't NEED constant growth in the economy if our money was debt-free. That's the dirty little secret. It HAS to grow in order to keep up with the non-stop infusion of counterfeit capital borrowed into existence. It's really that simple. Eliminate the usury-based monetary system and so many problems will go away (including the usurers themselves).
It's all Bullshit!!! The same 1% who got rich thanks to the Fed are going to continue getting rich. The rest of us are going to continue to get fucked by the Fed.
Very true, and anyone who fails to recognise the impossibility of infinite growth isn't even worth a place at the table!
We have aspired and strived for external growth at the expense of our internal growth. As a result, the fuller the stomach the emptier the soul. The emptier the soul, the greater the unhappiness.
The world is unhappy not because there isn't enough to go around, but because the more you have the more you need to sustain the addiction.
Who is this royal WE?
The Kleptocrats and the Banksters run this show.
WE need to enforce the laws, especially those regarding high treason.
Ask me how I feel when my wealth is forcibly taken from me, will you?
Bleh, this study actually sounds biased. I don't want to find myself defending the rich, but the study itself reads like it's worthless.
1) When they did all their street tests, they were testing for expensive cars. Wealthy people do not necessarily drive expensive cars. In fact, it is more likely they were simply testing the arrogant sons-o-bitches who like FLAUNTING their wealth, not necessarily the wealthy.
2) this:
Demonstrates to me only that those who are wealthy spend less of their time thinking about the general state of other people. But this says more about human solipsism than about empathy. Rich or Poor, we all live in our own constructed worlds. If you have wealth, you can isolate yourself better than anyone. It's not that wealth damages your empathy, it simply allows you to isolate yourself more. If you are poor, you simply have to deal with reality more on a day-to-day basis, which by nature forces you to consider other people more often.
Study smells like BS.
What little I have I use for peace of mind. Anything to keep me off the hamster wheel. As far as expenses go, I try to get by with the absolute minimums.
Mind you, this solution works only for me. I'm a very strong believer in being in complete harmony with who you are as well as your surroundings. It takes a while for a person to be able to be brutally honest with themselves. Then, things fall into place.
Anyone who thought debt piling on since the 80's was signs of growth shouldn't be listened to.
An interview with Professor Fekete may add to this debate:
http://www.thedailybell.com/exclusive-interviews/35987/Anthony-Wile-Dr-A...
Guess I'll move to Uruguay..
I would recommend Montevideo. There should still be mucho silver at the bottom of the Platte.
Uruguay is a highly rational and progressive country.
But.....whenever I spend a night in Montevideo I wish I was in Buenos Aires!
Use we much?
Wheeeee!
https://www.youtube.com/watch?v=6qJpUVtYfwM
What I see from my circle of upper middle class group I speak with and refuse to wake up. They prefer to blame below them instead of the real problem above them. They are so afraid of falling a peg or two for a stress free life, that they just run faster and faster on the hampster wheel each year. Also they can't believe the 180 I have done since 2007. It gets louder and angrier each time we get together.
Last week I sadly ended the 40yrs of my girlfriend thinking there was a p in hamster, honestly, sorry to break it to you Seasmoke mate, no offence.
They blame the poor in part because the establishment shields them so rigorously - they're all hard-working, competent, down on their luck folks. None of them fucked off all through school while the rest of us were working. None of them are stupid or violent. They all have 'skin in the game'.
When will people learn? Public sector monopoly courts and governments can never match up to Private courts and private governments in an anarchocapitalist society.
I am Danny I's rabbi. Be patient. You will understand. Not long now. Debt is wealth. Not for you but for us. Time is coming. Our shield of red will cover you. It is the only way. You will see.
seasmoke-spot on; the u.middle is vaporizing too. califonicated is first (and my sis can tell you first hand). ha fucking ha i say to them all uppity mid ups, whoosh, what happen'd. clueless educated, oxymoronic
The way I see it, it's a chicken and egg thing.
Does a lot of money make you a cheater, or do cheaters make a lot of money?
If the latter, money isn't the cause for what we're seeing today. It's the lies, frauds and boondoggles required to succeed under crony capitalism.
Plus the currency is literally made of lies and deceptions
I could not concentrate on reading anymore after a laxative became constipatory?
Here’s thinking we are absolutely clueless when it comes to the value of wealth, and that we keep chasing more of it because we’re not smart enough to recognize that value. And that that’s why we have torture and wars and all the other things that make us so ugly. We have absolutely no clue what the value of wealth is. And as long as we don’t, we shouldn’t have any.
Actually, it is more like they recognize the value of wealth, but do not recognize the value of everything else. Or perhaps some do, but self-consciously chose to be predators and cause endless harm to others. And yes, I said cause, not merely ignore. They cause. In fact, virtually zero wealthy get wealthy without causing misery and injustice to others. For those who become wealthy without harming anyone, through sheer force of production without destruction (harm, pollution, etc)... they're not the problem. If any of these kind of people remain.
"In fact, virtually zero wealthy get wealthy without causing misery and injustice to others"
Your moniker should be IgnorantFullofEnvy&ResentmentAnn"
I am endlessly amused by all you failures who cannot earn your own wealth, erecting yourselves as self-appointed authorities on all aspects of the process, morality, impacts, etc.
I delight in knowing that you will all struggle your entire lives and die never having achieved anything more than being complaining irrelevant serfs.
So lame, and so wrong. What a combo.
And you'd know I'm no serf if you read my posts.
Who do you imagine I envy? Or resent?
Also, how you interpret my message depends on what you consider "wealthy". My rough boundary is somewhere between $10M and $100M. Some people can earn $10M, but very few can earn $100M without ripping people off. Or so I reckon.
"very few can earn $100M without ripping people off. Or so I reckon."
You reckon WRONG, especially when you "reckon" from ignorance (ie YOU have never done it yourself or with other people who have done it together), arrogance, egotism, and the envy of those who have and the bitterness of knowing that you never will.
Your pseudo-moralistic arguments are the way that the failures soothe their hurting egos, ie "the only way to get wealthy is to be immoral, and I prefer to be moral rather than be wealthy".
My suggestion to all those who share your ideology:
Create the products and services that people are willing to buy at prices that are profitable, build the market and sales around those products and services, AND STOP WHINING AND BITCHING AT THOSE WHO HAVE DONE SO !!!!!!!!!!!!!
Then you tell me, just to enlighten me, who has $100M and earned that $100M without cheating anyone, or taking advantage of political favors (which is cheating and ripping people off --- even if you did not lobby for the political favors (laws, regulations, etc)).
Give us some examples.
-----
You know what? You are a utter disingenuous PUTZ. You blame me for "bitching at those who have done so", when I say in my own freaking posts that I have no problem whatsoever with anyone who earned extreme wealth honestly though extraordinary productivity. So WTF are you talking about, dimwit?
Ignore the dumbshit who can't provide coherent facts.
I actually know of one case where I believe a formerly pretty poor person/couple made $100+M within <10 years by not cheating, at least not in 1st or 2nd degree.
If however selling totally overpriced product to willing customers counts as 3rd degree cheating, then they would've been guilty of that.
Thanks for a thoughtful reply. Frankly, I'm willing to give someone like that a pass, assuming the labels on their products were 100% true and complete, and they operate in a business that doesn't have artificial support by government laws.
Which reminds me. Recently a friend in the states mailed me some labels off of food products and I almost fell over when I read them! In huge fancy fonts in several places the product labels scream 100% natural and 100% organic... but when I read the label, it reads like something out of a chemical factory. Holy crap what is considered "legal" today in the USSA is beyond belief!
Oh, and in case some smartass out there is about to tell me that some stupid manufacturers list chemical names instead of "Vitamin A, B, C and so forth" (nominally innocuous and potentially natural if sourced and manufactured properly). I'm aware of that, and only talking about "really gross stuff".
Though I consider it minor fraud, I'm not even talking about when they mix in big heaps of sawdust which they call more palatable names like "cellulose", because maybe the sawdust was taken from real trees (sheesh). I'm talking real artificial chemicals, made in huge vats from blatantly non-organic sources.
So, I'll nominally take your word it can happen in this age of ABSOLUTELY CLUELESS MORON customers.
Great article if the globull warming sprinkles were removed.
Also while no conclusions are noted,
the statement
Yet it was our wealthy participants who were far more likely to lie for the chance of winning fifty bucks
will likely lead to the same quick and wrong conclusions
as the other famous test which was misinterpreted for decades:
A child is put in a room at a table with a big piece of candy on it. It is told that it will be left alone in the room and if it doesn't eat the candy until the adult comes back, it will receive another big piece of candy in addition to the one on the table, both for it to keep.
Contrary to popular belief that test did not tell anything about the child's ability of self-restraint...
So flower gardens have an inherent moral superiority because of their apparent disconnect from currency?
Sigh. Will we never be free from the philosophical detritus of the French Revolution?
Being rich vs being wealthy, there's a difference.
https://www.youtube.com/watch?v=AdmW0rnvF_s
I decided to try reading this until I came across crap.
Imagine that without major new investments in adaptation, climate change will cause world incomes to fall in the next two decades by 25% across the board,
Thats as far as I got.
I don't understand why so many people keep bashing the 1%ers and then claim they keep getting fucked by the fed. It's time to get off your ass and do something about the fed fucking you. Create some wealth, get a job and buy some land, gold, silver, etc.... I get the impression that there are a lot of big babies that frequent this site, constantly whining how everybody is out to get them
We believe in a meritocracy of deserved and earned wealth.
Inherited, unearned wealth has no place here.
So "wealthy" is an attitude not an amount?
Nothing new here:
"He has the most who is most content with the least." - Diogenes
Since when is ZeroHedge a platform for Marxists? I'm in the top 5% income and wealth wise but I drive a 16 year old Jeep Cherokee with 234,000 miles on it. I see a lot of (new) BMWs and Mercedes in the poor neighborhoods around here. You can't judge a person's wealth by the vehicle they drive. That is typical of the Marxist intelligentsia's "analyses" that "prove" all rich people are "bad." No, people who are narcissists and feel they need to have status seeking vehicles are "bad" no matter how much money they have. Can you prove narcissists tend to acquire power (and wealth)? Certainly - but they are aided and abbeted by the big government crony capitalism we are stuck with - not the free market kind. This is perhaps the saddest thing I have ever read on this site...