June 25, 2009
In writing the series of posts on spreading the wealth and on financial frauds, I started musing on what wealth is and what it means to different people. For many people, becoming wealthy is seen as a desirable goal, an end in itself. Our media is soaked in wealth-porn, the endless regaling of how much wealthy people earn and the details of their lifestyles.
It seems to me that there are three pathways to becoming wealthy: inheriting wealth, acquiring wealth as a byproduct of trying to reach some other goal, and actively seeking it for its own sake because it is important to you.
There is not much one can say about the first category. One either has rich relatives who die leaving you their money, or one hasn't.
The second type of person is like that of some artists, like J. K. Rowling the creator of the phenomenally successful Harry Potter books, who achieve massive and unexpected success. My guess is that what drives such people is similar to what drives academics, they want to do something for its own sake and seek above all to produce a successful work of art that is recognized as such. Commercial success is very welcome but is not the primary goal. Evidence for this lies in the fact that such people usually do not stop creating new works even when they have no financial reason to continue working. It is the very rare author or actor or painter or musician who stops producing new work simply because they have made lots of money. For such people their primary goal is to produce something they are proud of and is valued by their knowledgeable peers.
There is a subset of this second category that consists of inventors. Such people like Thomas Edison, Henry Ford, Bill Gates, and Steve Jobs are similar to artists in that they are trying to create something new. But at the same time, they necessarily must have a business orientation since their idea is to produce something useful and valuable, not a work of art, and the main yardstick by which that is measured is by selling a lot of it. So making a lot of money is an important measure of whether they have produced something of value. This is different from an academic or artist or poet who can be considered a success while still not being rich.
The third type of person is one for whom making a lot of money is the primary goal in life and it does not matter to them how they achieve it. Such people are willing to spend their entire lives doing something they dislike as long as it enables them to become rich. They tend to view life as a competition and the winner is the person who dies with the most money. They may, in the course of making money, produce something of value and merit, but their primary goal is to be rich. So for them, it does not really matter if they became so by producing a better widget or creating a chain of stores or winning the lottery. Those are just the means to the end of becoming wealthy.
This is why I will never be wealthy. I do not have rich relatives and can expect no inheritance. I do not do the kind of work that is likely to make a lot of money as a side effect. But most crucially, I simply have no desire to be wealthy. While I will of course work to make a living and to "put food on my family" (in George W. Bush's memorable words), I simply cannot see myself doing something just for the sake of making a lot of money.
There are a very few occasions when I think it would be nice to have a lot of money. When I travel on long airline flights, I sometimes have to get to my coach seat by passing through the first and business class sections. When I see the comfortable and spacious seats they have compared to my cramped one, I think how nice it must be to be able to easily afford to pay the extra thousands of dollars for that luxury. But then I realize that in order to be able to be able to splurge for those few hours of comfort on a plane, I would have to work at a job I dislike on a daily basis all my life. That would not be a good trade-off.
In order to become rich for its own sake, you must be willing to spend a lot of time at it. If you want to become a successful investor in the stock market (say) you have to study the market and company reports and the business world and so on. The catch is that you would have to devote a lot of time towards this and that is something I have no wish to do.
What would be the point? My preferred lifestyle is one that is very simple. I don't much like to travel to exotic places or stay at fancy hotels or resorts, eat at expensive restaurants (or eat out at all for that matter), go to shows and concerts, etc. I like to live what others might consider a really boring life: reading, writing, thinking, and spending time with friends. My idea of a great weekend or holiday is when I have no place that I must go to and nothing that I must do. If I were to sacrifice my time and other interests to make a lot of money, I would have lost more than I gained.
POST SCRIPT: Signs of the times
Kodak announces that after 74 years it is is discontinuing production of Kodachrome film due to the public shift to digital photography.
Don't tell Paul Simon, he's going to be really upset.