Idle Rich Are the Best Rich. Here’s Why.

The college-admissions cheating scandal of 2019 has provided plenty of opportunities for schadenfreude at the expense of the lower-upper class: hangers-on and minor celebrities who needed a bit of lift to get their underachieving children into elite colleges. (The true upper class does not struggle with educational admissions; those are negotiated before birth, and often involve buildings.) The fallout has stoked discussion, internet-wide, about social class in the United States.

I’m 35 years old and don’t have any children, so college admissions are not (at least, not now) my fight. I care quite little about the topic itself because, to be honest, I find all this noise irrelevant. There’s the global climate crisis. There’s the imminent collapse of the wage market, due to automation. I have my own personal projects– I’m a year behind schedule on Farisa’s Crossing, my novel. (This is good lateness, insofar as I continue to discover ways to make the book better, but it is still lateness.) So, with all the things that actually matter, I don’t have a whole lot of cognitive bandwidth for the topic of college admissions. That issue’s mostly one of parental narcissism, and I’m not a parent.

Besides, just as the 1929–45 crisis (“Fourth Turning“, if you will) made irrelevant who went to Harvard versus Michigan in 1923, I believe the near future will find today’s obsessive attention given to minor differences in educational institutions to be absurd.

Still, not all of my readers are in the United States, and so many lack the privilege of knowing how bizarre and corrupt American college admissions are. It’s not that admissions officers intend it to be this way. They don’t. But there are a lot of absurd non-academic factors that go into college admissions, and the rich have far more time to assess and exploit the process than the poor.

Is this our society’s biggest issue? Hardly. Rich parents do all sorts of unethical things– often, completely legal ones– to give unfair advantages to their progeny. It has been going on for centuries, and it will likely continue for some time. College admissions fraud is a footnote in that narrative. I am glad to see the laws enforced here, but there are bigger issues in society than this.

Instead, I want to talk about the problem exposed by this scandal. See, it’s not enough for the American rich to have more money than we do, and all the material comforts that follow: bigger houses, speedier cars, golden toilets. They have to be smarter than us, too. But God did a funny thing: when She was handing out talents, she didn’t even in look in the daddies’ bank accounts. So, here we are. We live in a world where people make six- and seven-figure incomes helping teenagers cheat on tests. This isn’t new, either.

As a society, we suffer for this. Having to pretend talentless people from wealthy backgrounds are much more capable than they are, as I’ll argue, has major social costs. It keeps people of genuine ability in obscurity, and it leads to bad decisions that have brought the economy to stagnation. It would be better if we were rid of such ceremony and obligation.

How I Stopped Worrying and Learned to Love the Idle Rich

I want to talk about “the idle rich”, the aristocratic goofballs who don’t amount to much. They get a bad rap. I don’t know why.

They’re my favorite rich people, to be honest about it.

I don’t much like the guys (and, yes, they’re pretty much all “guys”, because our upper class is not at all progressive) at Davos. They do significant damage to the world. We’d be better off without them. Their neoliberal nightmare, a 21st-century upgrade of colonialism, has produced unwinnable wars, a healthcare system that has exsanguinated the middle class, and an enfeebled, juvenile culture that has lain low what was once the most prosperous nation in human history.

If we as a society decide to do something about the corporate executives who’ve gutted our culture and downsized the middle class out of existence, I’ll volunteer to clean up the blood. These people have a lot to answer for, and the quicker we can stop further damage, the better.

Do I hate “rich people”, though? I’ve met quite a number of them. Billionaires, three-digit millionaires, self-made as well as generationally blue-blooded, I’ve met all kinds. The truth is: no, I don’t hate them. Not really. What is “rich people”? Someone with more money. But, to 99.9 percent of humans who have ever lived, I am (along with most of my readers) “rich people”, just because I was born in the developed world after antibiotics. People born in 2200 may never know scarcity, and live for thousands of years. Good for them. I won’t burden the reader with my own philosophy on life, death, the future, spirituality, or life’s meaning (or lack thereof); suffice it to say, I believe that in the grand picture, material inequalities are fairly minuscule. If I’m still flying “klonopin class” in ten years, I’ll deal. The health of society, on the other hand, is of major importance. We only have one planet and, today, we are one civilization. Getting the big things right matters.

I don’t especially want to “eat the rich”. I don’t even care that much about making them less rich (although the things I do want will make them less rich, at least in relative terms, by making others less poor). I want our society to have competent, decent, humane leadership. That’s what I care about. Eradicating poverty is what matters; small differences and social status issues, we can deal with that later.

American society seems to have a time-honored, historic hatred for “idle rich”. Why? It does seem unfair that some people are exempt from the Curse of Adam, often solely because of who their parents were? It’s hard to accept it, that a few people don’t need to work while the rest are thrown into back-breaking toil. From a 17th-century perspective, which is when the so-called puritan work ethic formed, this attitude makes sense. It was better for morale for communities to see their richest doing something productive.

In the 21st century, though, do these attitudes toward work apply?

First, we can toss away the assumption that everyone ought to work.

We already afford a minimal basic income to people with disabilities, but most of these people aren’t incapable of work, and plenty of them even want to work. They’re incapable of getting hired. There’s a difference. Furthermore, as the labor market is especially inhospitable to the unskilled and young, it is socially acceptable for people of wealth to remove their progeny from the labor market, for a time, if they invest in education (real or perceived).

I support a universal basic income. On a related topic, there’s a problem with minimum wage laws, one that conservatives correctly point out: they argue that price floors on labor result in unemployment. That’s absolutely true. Some people simply do not have the ability to render work that our current labor market values at $15 per hour. A minimum wage is, in essence, a basic income (often, a shitty one) subsidized by low-end employers. They respond by cutting jobs. We can debate endlessly why some work is valued so low, but the truth of wages seems to be a trend toward zero.

As technology progresses, the fate of an everyone-must-work society is grim. The most important notion here is economic inelasticity. Desperation produces extreme nonlinearities in price levels. If the gasoline supply shrunk by 5 percent, we wouldn’t see prices go up by 5 percent; they’d likely quadruple, because people need to get to work. (This happened in the 1970s oil crisis.) We’re seeing it in the 2010s with medicines, where prices are often malignantly manipulated. It doesn’t take much effort to do that. Desperation drives extremity, and people are (in our society) desperate for jobs. Are we at any risk of all jobs being automated by 2030? No. But it takes far less than that to tank wages. No matter how much the technology improves, I guarantee that there will be trucking jobs in 2030. There might be fewer, though. Let’s say that 40 percent of the industry’s 8 million jobs disappear. That’s 3.2 million workers on the market. No matter how smart you think you are, some of those 3.2 million can do your job. And some will. As displaced workers leave one industry, they’ll tank wages where they land, causing a chain reaction of refugee crises. No job is safe. The jobs will exist, yes, but they’ll get worse.

In our current society where everyone just work to live or-else, the market value of almost everything humans produce (at least, as subordinates) is doomed to decrease by about 5 percent per year. That’s not necessarily a bad thing; another way to look at it is that things are getting cheaper. It’s only bad in a world where work is a typical person’s main source of income.

Ill-managed prosperity was a major cause of the Great Depression. In the early 20th century, we figured out how to turn air into food. That advance, among others, led to us getting very good at producing agricultural commodities. Cheap, abundant food. As a result… people starved. Wait, what? Well, it happened like this: farmers couldn’t turn a profit at lower prices, leading to rural poverty by the early 1920s, causing a slowdown in heavy industry in the middle of that decade. It was finally called a “Depression” when this problem (along with “irresponsible” speculation that is downright prosaic compared to what occurs on derivatives exchanges today) hit the stock market and affected rich people in the cities.

Why did we let rural America fester in the 1920s? Because the so-called “puritan work ethic” had us believing poverty was a sort of bitter moral medicine that would drive people to better behavior. Wrong. Poverty is a cancer; it spreads.

Ill-managed prosperity hit us hard in the 1930s; it’s likely to do the same in the 2020s, if we’re not careful.

All else being equal, for a person to show up to work doesn’t make society better. What she does at work, that might. The showing-up part, though… well, that in fact depresses wages for everyone else. It would be better for workers if there were fewer of them. That there are so many workers willing to tolerate low wages and terrible conditions devalues them.

For many workers out there, their bulk contribution to society is… to make everything worse for other workers. It is not their fault, it is not a commentary on them. It is just a fact: by being there, they cause an infinitesimal decrease in wages. And, today, we have this mean-spirited and anachronistic social model that has turned automation’s abundance into a possible time bomb.

Really, though, do we need so many TPS reports?

Obviously, if no one worked, that would be catastrophic. We don’t really need to force everyone to work, though. People work for reasons other than need: to have extra spending power, to gain esteem in the community, or because it gives their lives a sense of meaning. Fear of homelessness, though, doesn’t make anyone’s work better. It always makes things worse.

We could get at least 90 percent of society’s current revenues without forcing people to work. There’s no reason we couldn’t have a generous basic income and a free-market economy. That’s quite possibly the best solution. And, while I say “at least 90”, I really mean “more likely than not, more than 100”. That is, I think we’d probably have a more productive economy if people were free to allocate their time and talents to efforts they care about, rather than the makework they have to do, to stay in the good graces of the techno-feudal lords called “employers”.

It is not such a travesty for a person to remove himself from the labor market; for the rich, who already can, I don’t see it as a reason to shame them.

The second problem with the everyone-even-rich-people-must-work model is that it fails to create any real equality. Let’s be honest about it. “Going to work” is not the same for all social classes. Working-class workers are treated like the machines that will eventually replace them. Middle-class workers have minuscule autonomy but are arguably worse off, since it is the mind that is put into subordination rather than the body. For the rich, though, work is a playground, a wondrous place where they can ask strangers to do things, and those things (no matter how trivial or humiliating) will be done, without complaint. The wizards of medieval myth did not have this much power.

In other words, the idea that we are equalizing society by forcing the offspring of the rich to fly around in corporate jets and give PowerPoint presentations (which their underlings put together) is absurd. It would be better to let them live in luxury while slowly declining into irrelevance. When rich kids work difficult jobs, it’s toward one end: getting even richer, which makes our inequality problem worse.

Third, when we force rich kids to work, they take up most of the good jobs. There are about 225 million working-age adults. Whatever one may think of his own personal brilliance, the truth is that the corporate world has virtually no need for intelligence over IQ 130 (top 2.2%). We could debate, some other time, the differences between 130, 150, 170 and up– whether those distinctions are meaningful, whether they can be measured reliably, and the circumstances (of which there are not many) where truly high intelligence is necessary– but, for corporate work, 130 is more than enough to do any job. I don’t intend to say that no corporate task ever existed that required higher intelligence; it is, however, possible to ascend even the more technical corporate hierarchies with that much or less. So, using our somewhat arbitrary (and probably too high) cutoff of 130, there are still 5 million people who are smart enough to complete any corporate job. For the record, this is not an implication of corporate management’s capability. A manager’s job is to reduce operational risk and uncertainty, and dependence on rare levels of talent is a source of risk.

There are 5 million people who are smart enough, in any corporation in America, to competently fulfill an entire path from the entry level to the CEO. 5 million. For a contrast, there aren’t 5 million people in the U.S. with meaningful connections. I doubt there are even 500,000. Talent is fairly common. Connections are rare, and therefore more valued. The rich and the well-connected get the first dibs on jobs. The rest can’t possibly compete. No matter how smart they are, it doesn’t really matter.

Frankly, it’s of infinitesimal importance that Jared Kushner slithered into a spot at Harvard, causing a more-deserving late-1990s 17-year-old to have to settle for Columbia or Chicago. Whatever 17-year-old got bumped, I doubt she cares all that much. We all know that college admissions are more about the parents, anyway. No one intelligent really believes that American college admissions are all that meritocratic in the first place.

On the other hand, the U.S. corporate world is a self-asserted “meritocracy” (and, should you point out its non-meritocracy, you will soon be without income) despite being thicker with nepotism and corruption than third-world governments. That, I care about. Admissions corruption might lead a talented student to have to take her roughly-identical undergraduate classes from slightly less prestigious professors. In the work world, though, personal health, finances, and reputation are on the line. The false meritocracy of college admissions is a joke; the false meritocracy of the corporate world kills people.

Fourth and finally, when rich kids go to work, what do they do? Damage the world, mostly. A large number of them are stupid and incompetent, the result of which is: bad decisions that cause corporate scandals and failures that vaporize jobs. Most of the smart ones, worse yet, are evil. See: the Koch Brothers, Roger Ailes, and Erik Prince.

We would have such a better world if we convinced these guys it was OK to goof off.

The European aristocrats, to their credit, were content to be rich. Our ruling class has to be smarter than us.

I don’t mind that the corporate executives fly business class and I don’t. I do mind being forced to indulge their belief that their more fortunate social placement is a result of their being (intellectually speaking) what they think they are but are not, that I actually am. That galls me. If these people could admit to their mediocrity and step aside, it’d be better for all of us. The adults could get to work; everyone would win.

I don’t hate “the rich”. In fact, I wish everyone were rich. There may be a time in our future when that is, in effect, the reality. I hope so, because we seem thus far to be an “up or out” creature and, in 2019, we are effectively one civilization. Our current state is unsustainable. In the next two hundred, we either get rich or (at least, as a culture, although we may survive in the biological sense) we shall die. In the former case, I do not forecast utopia. There will always be disparities of wealth and social position. More likely than not, those advantages will be uncorrelated to personal merit– this as true of today’s upper class “meritocrats” as much as it was of medieval lords. On its own, that’s benign. So, to hate “rich people” is like to hate a tornado.

On the contrary, though I do not hate the rich, I hate their effects. I hate living in a society run by morons and criminals– one where housing in major cities is unaffordable for almost everyone; one where people have to buy insurance plans on their own bodies that cost $1,000 per month and provide half-assed coverage; one where bullshit jobs and managerial feudalism are the norm.

Furthermore, I do not think it makes the rich happy that we force them to work. It certainly does not make us happy to be shoved out of important, decision-making roles because the well-connected incompetents (or, far worse, the self-serving and evil) need those scarce jobs.

We, as a society, have reached a point where idleness is the most harmless of vices. We do not need more people hunting on the Serengeti; we do not need more internal combustion engines hauling people around to say “Yes, sir”.

Most so-called “work” has trivial, nonexistent, or even negative social value. The vast majority of corporate jobs exist to perpetuate or enhance private socioeconomic inequalities, rather than to better society. The so-called “protestant work ethic” would have us predict that price signals (salaries) correlate to the moral value of work. They don’t. Anyone who thinks they might needs to leave the 1970s because Studio 54 closed a long time ago.

If rich people stop working, they stop hogging the good jobs. They stop hogging the investment capital and wasting it on artisanal dog food delivery companies. Since they’re enjoying life more, they will feel less desire to exact revenge on society for forcing them to make four PowerPoint presentations per year, which will make them less aggressive in squeezing employees. So they’ll hog less of the damn money, too. People will start leaving their office jobs while the sun is shining, writing their own performance reviews because the bosses are skiing all month, and everyone will be better off for it.

Let’s not eat the rich. Instead, let’s get them fat, and roll them out of the way, so competent adults can take the reins of this society, before it’s too late.

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23 thoughts on “Idle Rich Are the Best Rich. Here’s Why.

  1. > and, yes, they’re pretty much all “guys”, because our upper class is not at all progressive

    It may not have little to do with progressiveness. I’ve seen a black guy conclude through systemic thinking that the reason that white guys are far richer than black guys is due to cronyism, not racism.

    Cronyism is basic human instinct, so you cannot do much about it. It is present in every human mind. How can you not help a child of someone who helped you with your career in the past? How can you not help your children? How can you not help your close friends who were of help to you in the past?

    It just happens that white guys accumulated more wealth by luck in the form of proximity to important people. Thus, if you live in social promixity to important people, you are much more likely to succeed regardless of your gender or your race.

    It’s also possible that women from rich families are not interested in davos for the same reason that there are only guys in many technological conferences despite the fact they don’t particularly discriminate women for any reason. To me, davos looks like a meeting of boring guys in suit.

    • I heard many women feel uncomfortable when they are surrounded by too much sexual attention from a lot of (creepy) guys. That can be a partial reason for why women don’t usually go to technological conferences full of (creepy) guys.

  2. I think rich with an important life purpose is better than idle rich.

    For example, Elon Musk wants to prevent extinction by building multi-planetary civilization although human nature can easily outpace colonization effort. Elon Musk has monster productivity and an important life purpose.

  3. Great Read. so many questions lets start with this one,
    theres a subset of the rich who have all the qualities we like(intelligent, empathetic, visionary, etc.) who we should encourage to be active in society…encouraging the few to be active would create a dynamic where the remaining rich we don’t want to be active will feel the need to prove they should be active in society.

    • Being inspired to be active is far better than being forced to have a job.
      When the rich take inspirations from Elon Musk, the world will become better.

  4. I think the ideal isn’t idle rich, but idle rich in positions of authority who don’t interfere with a company’s inner workings. I’ve come to accept that having rich kids in a company is inevitable. Investors trust them, clients instinctively say “yes” to them, and they can conjure up huge amounts of money as if by magic. This means the company is not entirely dependent on the market – it has a life vest. And since it is almost impossible to predict wherher a company will be succesful, this is about as close to a sure thing there is.

    Talent alone can’t do this. Most businesspeople don’t have the same view of it – at best, they ignore it, and at worst, they go out of their way to punish it. That’s the world we live in, and I accept that, as humiliating as it may be.

    I think the personal character of the rich guy in charge matters more. I’ve worked in two startups with rich guys. The first was breezy, hands-off, and an overall decent guy, who understood that his purpose was to line up clients and investors. The second was a complete shithead – lying to us, getting us in all kinds of financial hell, shifting our paydays around, firing people who disagreed with him, and making personal threats to people. When you’re looking at a company, pay particular attention to the rich guy. He won’t be hard to sniff out – is he rude, do people avoid eye contact with him, does he say offensive or unnecessarily critical things, and does he behave as if his company was the greatest thing since Jesus? Avoid people like this at all costs.

    • How do you spot the rich guy? Look for the guy who wafts through the office, unburdened by anything, with a slightly soapy aura.

      • And, while we’re on the subject of talent being worth less than connections, let’s think about why that is. I wonder if investors and clients have internalized the “returns over volatility” thinking in high finance. Investors want this for obvious reasons, but clients also want it because they’re looking for stability in whomever is providing a service.

        The best asset is something with high returns and low-volatility. A well-connected rich guy has high returns and extremely low volatility, simply because saying “no” to him means saying no to his family, and then suddenly you have an entire army of financial entities against you. A well-connected MBA, not necessarily rich, has high returns but higher volatility, so they’re less valuable – people can say “no” to them with impunity, but when they win they still win big. Someone with non-business talent, however, is screwed by this metric. They can only show returns if they work for a company where they’re free to do what they feel best, where they’re not blocked by less talented coworkers and managers, where they don’t have to wrestle with inefficient legacy, and where they’ve had extreme foresight to predict what the market wants. And when they do get returns, they’re probably not given credit – that goes to management. For these people, volatility comes from within and without. Within, meaning burnout, moodiness, creative dry spells, all the things that intelligent people have to deal with, and mediocrities don’t. Without, meaning sabotage, in the form of being ignored, in the form of workplace harassment/mobbing, in the form of being cut down by vindictive middle management. Low returns, extremely high volatility.

        It would not be this way if companies were forced to prioritize talent by some external circumstance. The Allies, facing an existential threat, were forced to prize the genius of outsiders such as the Jewish Feynman or the gay Alan Turing. During the Cold War, the humiliation of Sputnik put mathematical and engineering prowess at the forefront. But in both cases, Western Civilization had a gun held to its head. Startups don’t prize talent because they feel they can get by without it. When there is a startup with extremely talented people, that fosters a culture of excellence, and beats the market, its acquisition quickly snuffs it out. The revolutionaries are pensioned off with a couple million bucks. Or, the company grows and the MBA’s come in and turn it into a normal salt mine. A company that managed to be big *and* keep its culture of excellence would be an existential threat that would change the industry. Google was almost that, but then, through their draconian hiring practices and their love of MBA’s, they became a normal company. The returns/volatility ratio prevails in the current regime, but as any market practitioner will tell you, regimes change.

        • I think you’re right.

          Do you think that existential risk and violence are humanity’s only hope, then? Sometimes I feel this way; it seems that the only thing that can get people to do the right thing is a state of severe danger leaving no room for fuckery.

  5. Do you know what the real problem with society is, Michael? It’s that you’re 35 and have no kids. Your IQ must be 140 at least.

    Who is going to save the planet from global warming, or whatever else? The fictional people in your book? You need to get real and have some kids, for all our sake.

    • The world has no demand for high-IQ people. It has low demand for children (and therefore the highly fertile people tend often to be those who aren’t paying attention) in general, as evident by the massive financial penalties on procreation, and this does not change as you get smarter. If anything, it gets worse if you’re smart, because the positions and resources your kids will deserve are going to be handed off to mediocrities who had the good fortune to come out of a richer and better-connected man’s pecker.

      If humanity is in a shutdown routine, no sense in creating more suffering.

      • Intellectual labor is generally not compensated fairly. Regardless, the world clearly needs smart people.

        We have a glut of unskilled, unintelligent people, and it is getting more extreme. In the near future, we are more likely to end up returning to servants than having robot helpers. That is the real shutdown routine.

        Whatever problems you think exist, they will not be solved if enough people like you decide not to have children. If you don’t want kids, fine, but your personal preferences are not helping the human race.

  6. For us to be able to *afford* a universal basic income (that isn’t so miniscule as to be beside the point), wouldn’t our society have to have so much surplus wealth that the average middle class person could afford to subsidize at least another person’s existence at a middle class level? We don’t seem to have that kind of spare wealth. And the rich aren’t going to pay for it (Seriously, how are you going to make them? Go ahead, try to print that money, or tax it, and see what happens.)

    We have a welfare system targeted at a small fraction of our population right now, because that is what we can afford. We don’t really live in a robot utopia, we just pretend with overseas slave labor.

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