“Financial status is the way we demonstrate to others (and ourselves) that we are successful—hence the fancy watches, the expensive cars, and the bespoke suits. We use these things to show other people not just that we are prosperous, but that we are prosperous because we create value.
There is nothing strange about measuring our success with money; we measure things indirectly all the time. I require my students to take exams not because I believe their scores have any inherent value, but because I know these scores correlate extremely well with how much they have studied and how well they understand the material. Your doctor draws your blood to check your cholesterol not because blood cholesterol is interesting in and of itself, but because it measures your risk of having a heart attack or a stroke. In the same way, we measure our professional success with green pieces of paper called ‘dollars.’
What scholars often portray as an ignoble tendency—wanting to have more than others—is often evidence that we are driven to create value. Wanting to create value is a virtue, not a vice. The fact that it also brings us happiness is a tremendous blessing.
Have you ever wondered why rich entrepreneurs continue to work so hard? Perhaps you’ve said, ‘If I had a billion dollars, I’d retire.’ This is what Mack Metcalf [a forklift driver who won a $65 million Powerball Jackpot, and died 4 years later from cirrhosis of the liver] actually did when he won the lottery. But if he had earned that money doing something creative and productive, things would almost certainly have gone differently for him. People who succeed at what they do tend to keep doing it. The drive to succeed, as opposed to just having more money than others, explains why the super-rich—who already have so much more than virtually everybody—continue to work.
Take the case of billionaire Larry Ellison, founder of Oracle. The world’s 14th-richest man, he would need to spend more than $30 million per week, or $183,000 per hour, just to avoid increasing his wealth. Further, he would have to spend it on items with no investment qualities, meaning that, unless he sets his money on fire, or (better yet) gives it away, he simple cannot not be filthy rich. Yet he continues to slave away, earning billion after billion. Being rich, and having more than the average Joe, simply cannot be driving Larry Ellison. It is the will to succeed and create value at greater and greater heights.
Who enjoys the benefits created from the slaving of Bill Gates, Warren Buffett, and all of America’s other success-addicted, ultra-rich entrepreneurs? We all do: As long as fortunes are earned—as opposed to stolen, squeezed from governments, or otherwise extorted from citizens—this is good for all of us.
Oracle has not made Larry Ellison a rich man without any benefit to society. The firm currently has tens of thousands of employees, people with well-paying jobs to support their families. The company has introduced technology that has benefited all parts of the economy, and it has paid billions to its shareholders. And we can’t forget that Oracle has rendered generously unto Caesar, year after year: In 2007 alone, it paid $1.2 billion in corporate taxes, totally apart from the personal taxes paid by Ellison and his employees.
Money is a measure of success, and a handy one at that. But there is a dark side to this fact: People tend to forget that money is only a measure. Some people focus on money for its own sake, forgetting what really brings the happiness…
In 1978, for example, researchers presented a sample of adults with a list of 24 big-ticket consumer items (a car, a house, international travel, a swimming pool, and so on). They were asked how many of these items they currently possessed; they were also asked, ‘When you think of the good life—the life you’d like to have—which of the things on this list, if any, are part of the good life as far as you are personally concerned?’
Inevitably, people felt that the ‘good life’ required more things than they currently possessed. Among the people between 30 and 44 years old, the average number of items owned was 2.5, while the ideal number was 4.3. The same people were interviewed 16 years later, in 1994, and presented with the same list. Naturally, most people had more items; the ones formerly in their 30s and early 40s (now in the next age category, 45 to 59 years old) had 3.2 items, on average. They were closer to the good life, right? Wrong. Their requirements for the good life had now shifted, to 5.4 items. In other words, after 16 years and lots of work, the ‘good life’ deficit had stayed almost exactly the same. The more stuff you have, the more you want.”
From Arthur Brooks’s article Can Money Buy Happiness?.
Tomorrow is my last day working at the American Enterprise Institute, of which Arthur Brooks is the current president.
Following his graduation from high school and a brief stint at the Annapolis Brass Quintet in Baltimore, Brooks moved by himself to Spain to become the principal French hornist of the City Orchestra of Barcelona. While eating lunch in the AEI dining room the other day, I overheard Brooks recount this personal story too improbable for any novel, which he capped off by saying he was leaving the table to head to catch a flight — to western India to meet with the Dalai Lama. Needless to say, he’s a pretty compelling case.
Below is an excerpt from Marvin Olasky’s recent interview with Arthur Brooks:
How many French hornists have become presidents of the American Enterprise Institute? One.
What are the similarities between playing the French horn and being president of AEI? Creativity… the working out of ideas that are of interest to other people… and the privilege of having audiences enjoy your work. The only barriers in front of you are those put in place by your own imagination.
Why did you decide to move from a prestigious orchestra position to academic work? Things were going well … and I wasn’t happy. What I wanted to be was an economist. I wanted to do that analysis of how the gears turn in society. I hadn’t even gone to college, so at 28 I had to go to college and get a graduate degree.
When you told your dad about your new plan, what did he say? I said, “Dad, I want to become an economist.” After a silence he said, “Why would you want to do that? You’re at the top of your career.” I said, “Because I’m not happy.” He said, “What makes you so special?”
A Harvard economist once told me he did not plan to have any children because he figured that every child would cost him a book, and he wanted to publish books rather than have children. You have three children, and you’ve published lots of books. Does having children inspire you to publish more? I do believe the world will benefit more from my children than it will from my books, but there is a connection. My wife and I had had our two sons biologically. I was writing this book about charity and finding that when people give to charities their lives improve dramatically. I wrote a chapter on it, and everything I write my wife Esther reads.
That’s wise. For sure. She’s spiked a lot of my stuff. Susan probably spikes your stuff too sometimes, right?
Yeah. A couple times that she hasn’t I wish she had. Exactly. So I brought home this chapter that shows charitable actions make you happy and healthy. Esther ruminated on it for a while, then said, ‘We ought to use the information in this book to change our lives a little bit. I think we should give more.’ I said, ‘OK, I’ll write a check.’ And she said, ‘I think we should adopt a baby.’ I said, ‘It’s only a book!’ Then of course I had no argument, so we did. We adopted our daughter from China. She’s now 8 years old.
Two questions: First, how should we define fairness? Seventy percent of Americans believe that true fairness means rewarding merit and creating an opportunity society, which is exactly what the free enterprise system is designed to do. The fairest system is one in which people have an opportunity to rise. That doesn’t mean they shouldn’t have a safety net, but a safety net is not middle-class welfare. It’s not spreading the wealth and getting rid of risk: It’s simply making sure that people don’t have the most abysmal poverty and starve.
Second question: “Earned success” is a key concept in your book. What does that mean? Earned success is the idea that you’re creating value with your life and value in the lives of other people. It’s not money per se: It’s the value you create with your life. You can denominate it with souls saved, or neighborhoods that are habitable, or clean drinking water in Africa, or lots of money, or beautiful works of art, or having children who are honest and have good values, or whatever. People who say they’ve earned their success are the happiest people. It has to be earned.