The Folly of Wealth

I briefly glimpsed how the elite live.  A long time ago, I was the web development manager for a company which published classified ads for boats.  These could be anything from rubber dinghies to large yachts.  Management deemed it important that we present our glossy magazines at a conference of yacht builders and owners.  The gathering was held in Monaco.

My sales colleague was the lead; she was not at all technical, hence, I was invited to come along.  I was there to answer any questions about the website that accompanied the publication.  I ended up carrying a heavy bag full of magazines.

In contrast to most of the attendees, my colleague and I travelled via EasyJet.  We got a taxi from the airport to the principality of Monaco. 

Monaco is an anomaly; it’s an independent state surrounded by France on one side and the sea on the other. It’s known as a playground for the ultra wealthy and for its casinos. It’s also known for Formula 1 racing. There are boutiques featuring clothes and shoes from all the best designers. From what I saw, that was about it. Normal people had to make do with gawping at supercars parked in front of plush hotels, and eating fast food from kiosks. In short, it appeared to be a place for very well off people to flex their wealth and for the rest of us to look at it.

My colleague and I eventually made it to the exhibition.  From the start, it was clear that we had entered a completely different world.  I recall a stand manned by Dassault, the French aerospace manufacturer.  They had colour, wood, and leather samples on display for the interiors of private jets.  A video in the background showed a Dassault private jet flying towards the horizon above clouds that looked like massed cotton buds.  

My colleague and I discovered that rival publications were there. We felt outclassed. Unlike ours, they came in a variety of languages including Russian and Mandarin Chinese. We distributed what we could, had a break to get a soft drink, then scuttled back to the airport and took the first flight home.

The exhibition was a look into a world where someone can see a stand selling a private jet and think, “Yes, I’d like one of those,” write a cheque and have one delivered. However, over ten years after this experience, it seems the ultra wealthy now live in a stratosphere that floats even higher: I doubt they would bother to go to an exhibition, Dassault would perhaps go visit them.

But what is the point?  No matter how wealthy someone is, an individual has only one body.  There are limits to the number of fine meals one can eat, expensive wines one can drink, homes that one can possess and actually live in, beds in which one can sleep.  The amount of luxury that it is possible to consume or appreciate does have definite barriers.  And yet, the ultra wealthy have far more than this.

For the purposes of comparison, Elon Musk paid $44 billion for Twitter. This is sufficient to buy the Washington Commanders American football team nearly 8 times over. He could, theoretically, have bought a number of football teams and created a league of his own. This might have been more profitable, if not more fun.

That said, even if he loses his Twitter investment and has “just a few” billion left, he simply will not feel this loss in terms of his day to day existence. His pride may be damaged, but it won’t change the quality of his living conditions. He has more money that he and his reported ten children can spend in their lifetimes. Musk may have more than his ten children’s descendants can spend. He will never be able to appreciate or realise his wealth except as an abstraction.

There are ways out of the trap; philanthropy is one of the most positive. Andrew Carnegie made a great deal of money and was quite ruthless. However, he did build Carnegie Hall. Carnegie Mellon University is one of the finest in the country. Bill Gates has donated substantial sums via his foundation. If you have more wealth than you can possibly use, then why not use it to better the world around you? At least one’s reputation may grow in stature.

However, some appear to go for idle amusements.  Musk fits into this category.  He is treating Twitter as some sort of personal playground as opposed to a vital utility despite proclaiming its necessity for public discourse.  Some want power. The Koch brothers and their promotion of far-libertarian ideas are an example.  Some find that appetite increases with the eating and continue to build fortunes which are simply no use to them.

Meanwhile, we pay a price for this aggregating inequality. The very wealthy can keep growing their fortunes very easily. If they stick their assets into an index-linked fund, they need not actively intervene in their investments.  Yet wages for most people have stagnated; the standard of living in the United Kingdom is in active decline.  The only people who appear to be able to make a fortune are those who have one already.  

Viewed through this prism, current economic policies, by and large, are wrong. They are based on the notion that the wealthy, if given greater economic power, will invest more in businesses which will stimulate employment and growth. However, the wealthy don’t need to actively invest. Furthermore, most employment in Western economies comes via small and medium sized enterprises. The wealthy tend not to start these firms. Rather, those who have limited access to capital tend to be their initiators.

Small firms usually sustain themselves by appealing to those who have a desire to spend: individuals who require goods and services. Because of the limitation of any one person’s needs, the place to look for customers tends to be among those who aren’t wealthy. Thus, paradoxically, the ultra wealthy don’t necessarily create economic growth and widespread prosperity. Rather, it is via a more even distribution of wealth, i.e. equity, that best outcomes for the many can be achieved.

Although the logic applied here is based upon realistic market conditions, no doubt some would describe it as “radical”, even “socialist”. So be it. However, these ideas may also be “necessary”.

Political systems rely on promises. Some promise order, some offer prosperity, some pledge both. Western democracy has long had the following compact: work hard, and your children will be better off than you are. But what happens if that promise proves to be untrue? In the case of right wing populism, current fallacies stay in place. Minorities receive the blame for the contract no longer being valid. This populism has proven to be so enduring partially because it also contains the thrill of transgression, being able to say and do hostile and offensive things as if it were a natural right.

Unfortunately, the re-emergence of Donald Trump and the continued success of figures like Marine Le Pen suggest that society is not yet willing to face its problems directly.  Rather, it is willing to cater to the absurdity of someone buying a private jet or multiple private jets with a choice of interiors as a matter of mere personal choice, as rather than a symptom that something may be wrong.  If we don’t diagnose the illness properly, then we will never arrive at a cure.  Until we arrive at a cure, we will all stay sick. 

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