By Philippe Gastonne
Sam Wilkin is an economist and
has been studying the very rich for most of his working life. And he's not
talking about ordinarily loaded here… No, he's talking about 'a fortune of
yachts and personal helicopters, of diamond-encrusted light fixtures, of
stately homes and private islands, of your name emblazoned upon landmark
buildings and a charitable foundation bravely tackling world issues'. A fortune
that ensures your name will live forever, even if you can't.
Suppose such a fortune was
your goal. How would you acquire it? Wilkin seeks to answer this question by
studying the relatively small number of people in history who have achieved
this. And he finds a certain number of common factors.
Wilkin has determined that
behind almost every great fortune, there lies what he calls a 'wealth secret'.
This is a piece of knowledge or a technique that, while not exactly criminal,
certainly skirts the customs of the time, and possibly the laws as well. All of
them, he says, involve 'some sort of scheme for defeating the forces of market
competition'. Many involve legal maneuverings or the exercising of political
influence. Boldness and fearlessness are a given. Psychopathy helps, too.
That the super-rich are not
like you and me is no surprise. Among other differences, they have billions of
Federal Reserve Notes to their name – more than they can possibly spend. How
does one join them?
The author profiled in today's
article asks that question. He finds that massive wealth most often arises from
having "some sort of scheme for defeating the forces of market
competition." Usually this includes "legal maneuverings" and
"political influence."
Your correspondent has long
questioned the simplistic American narrative that working hard, thinking
positively and having great ideas brings financial success. That theory simply
doesn't match the empirical evidence.
We all know people who work
hard, think positive and have great ideas, yet are not wealthy.
We also know lazy fools who
somehow amassed a fortune.
Since the correlations clearly
aren't causative, some other force must be at work. Professor Wilkin's book
suggests the wealthy become so not by excelling in a competitive economy, but
by making it uncompetitive. This applies to modern tech titans as well as 19th
century robber barons.
Would today's large
corporations exist if government didn't grant them special privileges and/or
restrain potential competitors? Maybe some would, but the majority clearly
would not. This means they would not have grown so large, and their founders
would not have grown so wealthy.
Their main tool is the modern
regulatory state. The reams of regulation that govern manufacturing and
distribution of practically anything create economies of scale where none would
otherwise exist.
For example, Apple can afford
to have hundreds of engineers and attorneys decipher the technical rules of the
Federal Communications Commission, and equivalent agencies in other countries.
The person who thinks he can build a better smartphone in his garage can't call
on that resource. He won't succeed no matter how great his idea is or how hard
he works.
Maybe some people do acquire
great wealth without political influence, but we can't think of many examples.
Wealth, political corruption and moral weakness always seem to find each other.
As the article says, "It's all very well being the best in your field, but
it's much more lucrative to be the only."
No comments:
Post a Comment