Thursday, October 26, 2006

More Class Warfare

Andrew Samwick shares some thoughts about the issue of Rich v. Super-rich. He argues that what the Rich resent is that their occupations are not rewarded as they think they should be, under some sort of socialist economic system:
I think the educated trade classes resent that the contributions they make through their intellect and efforts are not valued by the market as highly as the returns to innovation and risk taking in product markets. The amenities that would accrue to them under (their idealized notion) of a more socialist system are becoming more expensive.
I have to disagree with Andrew. And I think I can pinpoint the source of our disagreement: I don't think that the division betwen the Rich and the Super-rich is occupation-based. In other words, I'm skeptical that it's as simple as Andrew describes, wherein well-educated professionals (doctors, lawyers, etc.) are merely Rich, while the Super-rich are entrepreneurs and financiers.

My hunch is, instead, that there are both Rich and Super-rich people from each of these various occupations. Some doctors, lawyers, as well as entrepreneurs, entertainers, and athletes become Super-rich, but most of each group do not. And that's where the trouble starts. Those who are merely Rich look at their peers who have become Super-rich, and feel cheated. And resentful. They gripe and complain. They gnash their teeth. And then they vote to soak the Super-rich.

If the divisions between the two groups are indeed not occupation-based, then the success of the Super-rich could seem much more arbitrary to people, and thus be a much greater potential source of bitterness. After all, if it's simply a question of choosing a different occupation to become Super-rich, then you have only yourself to blame. But if you see others with your exact occupation becoming Super-rich, then that's different.

Shorter Kash: I think being lucky has a lot more to do with becoming Super-rich than being in the right occupation.

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