"If you're so smart, why ain't you rich?"
Neither intelligence nor general ability has anything to do with wealth.
Simply look at the wealthiest people in the world. These are not the best of humanity, nor the brightest. They are merely the wealthiest.
If anything, ability tends to relegate one to the upper edge of the lower classes, because it only makes sense that ability should be used. If you have dancing ability, you should dance. If you have musical ability, you should make music. With remarkably few exceptions, using real abilities does not make much money. In the end, it is always limited by time, and time is always too short for riches.
I once calculated that I was worth $2000/hour to one company. They didn't pay me that, of course, or anywhere near it. But had they paid me that, and had I been able to sustain that work for a full year, I'd have earned four million dollars. A typical lawyer, working at $300/hour, would require nearly seven years to earn four million dollars. A mechanic, working at $50/hour, would work for 40 years to earn four million dollars.
You cannot earn a hundred million dollars in one lifetime with ability. You certainly cannot reach a billion dollars.
The only way to accumulate such a substantial fortune is through leverage, which means -- one way or another -- gaining a legal claim on the labor of others, and taking for yourself a disproportionate share of their earned reward. There simply is no other way to do it.
That doesn't require ability. It requires understanding the truth that underlies the game: that it isn't about your ability at all. It is about other people's abilities, and their willingness to work for a lot less than they are worth.
Sunday, August 08, 2010
Stolen
Quiet days here. Experimented with some coke liquor thing they manufacture in Holland, nice stuff :-P Feels like the real thing, only more expensive. The only reason why anything is legal is just so they can tax your ass. Nah, I don't really believe that. While randomly browsing the web, I found this post from Socks and Violins.
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ReplyDeleteThe only way to accumulate such a substantial fortune is through leverage, which means -- one way or another -- gaining a legal claim on the labor of others, and taking for yourself a disproportionate share of their earned reward. There simply is no other way to do it.
ReplyDeleteYeah, only no.
The key trick in that paragraph is "disproportionate share" (and "earned").
Unless the original writer can tell me which of the (for example) Microsoft employees that helped make Bill Gates rich did not get a "proportionate" (?) share of their "earned reward" (?), he'll have a big problem.
(? meaning that "proportionate" and "earned" have no meaning outside of whatever the two parties negotiate, but the writer really wants them to, as near as I can tell.
He seems annoyed that what he calculated his "value" at was not equal to what he was given - problem being that if he was given exactly what he created for the company, it would never bother to hire him, since you can also balance to zero by simply not employing.)
Yes, wealth is not amassed by ability or intelligence particularly (especially to people like Sultans) - but neither does that mean that the Ellisons and the Gateses did so with a "legal claim on the labor of others" (ie, the old Communist canard of "exploitation").
They did so by creating (or being instrumental in the creation of) something of incredible value, and got wealthy precisely because free people in a relatively free market decided it was valuable... and raised the value of shares of it.
Most people, it turns out, DO work for about what their abilities are worth.
The problem is that the author acts as if "worth" means "the total of all gains related to the labor", not "what someone will pay for it".
Like all economic goods, labor is worth only and precisely what you can get for it.
Authors who say "there simply is no other way to do it" without explaining why the obvious counter-examples aren't what they appear, is, as the movie says, trying to sell you something.
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