Occupy Wall Street: Economic Prosperity Is Rewarded by Effort
The rise of the Occupy Wall Street movement has brought with it a renewed emphasis on the impoverishing notion of envy. To the Occupiers, along with much of the political class, society’s economic rules favor the top 1 percent at the certain expense of the other 99.
Great rhetoric for sure, but also quite a lot of nonsense. People who should know better bemoan the economic means possessed by the 1 percent, but rarely do they consider the gargantuan efforts required by those at the top to get there in the first place.
To show why this is true it’s useful to reference an opinion piece written by Thomas Sowell long, long ago. Having witnessed a caricature artist draw a willing individual, when the artist collected his payment after services rendered he was dismayed to hear the customer complain about the “high” cost of something which took five minutes to draw. But as the artist correctly pointed out, the customer didn’t see the 25 years of hard work and practice that preceded his ability to sketch an individual in five minutes.
The age of Sowell’s op-ed can be measured in decades, his point within concerned the huge upfront investment required by pharmaceutical firms ahead of tiny pills that “cost way too much”, but his reasoning surely applies much the same to successful individuals today. The envious see the success on the way to obnoxious anger and calls for wealth redistribution, but very few see all the work and sacrifice that precedes entrance into the 1 percent club.
Considering the myriad business owners that dot the American landscape, as owners they’re often demonized for their possession of the means of production. What’s left out is the grand deal they’re offering the 99 percenters who work for them.
Basically the owners provide the capital, conceive the business plan, and then if the plan fails, as owners they stand to lose all that they ventured. As for the allegedly exploited laborers, they get paid no matter what. Not a bad deal.
In modern times cable television visionary John Malone is known for his billions, along with landholdings said to be greater than those held by any other American. Not often mentioned is that on the way up, desperate to keep his cable vision afloat, he shared motel rooms with fellow owner Bob Magness.
Of course many of today’s owners began as employees, and even there we perhaps learn that the 1 percent are made of different stuff. Looking for work in an increasingly prosperous Cleveland, OH in 1851, John D. Rockefeller’s biographer Ron Chernow observed that for the future titan of commerce, “prospects were momentarily bleak.” As Rockefeller later described it, “No one wanted a boy, and very few showed any overwhelming anxiety to talk with me on the subject. But as Chernow put it, “When he exhausted his list [of potential employers], he simply started over from the top and visited several firms two or three times. Another boy might have been crestfallen, but Rockefeller was the sort of stubborn person who only grew more determined with rejection.”
Readers of the above doubtless sense a rhyme to Rockefeller’s early history with that of the late Apple CEO, Steve Jobs. As Jobs’ biographer Walter Isaacson recounts in his book about the man, Jobs arrived at Atari’s offices early in his career and told those willing to see him that he would not leave the premises without a job offer. Having written a major bestseller that was more recently turned into a blockbuster film, Kathryn Stockett, author of The Help, is firmly ensconced now inside the top 1 percent. What’s perhaps less well known is how many years it took Stockett to write her book, not to mention the 60+ rejection letters she received from agents before finding one willing to take her vision to publishers.
1 percenters generally have the nerve, drive and self-assurance that the rest of us could only dream of. We see where they are or were, but what the envious among us never consider is what they did to get there.
Former Congressman Richard Gephardt once said that the rich, far from having achieved wealth through hard work, had simply won “life’s lottery.” The story of the Rolling Stones as told by guitarist Keith Richards exposes Gephardt’s musings as patently absurd.
Indeed, as Richards noted about the band’s early days, “Benedictines had nothing on us. Anybody that strayed from the nest to get laid, or try to get laid, was a traitor. You were supposed to spend all your waking hours studying Jimmy Reed, Muddy Waters, Little Walter, Howlin’ Wolf, Robert Johnson. That was your gig. Every other moment taken away from it was a sin.”
Grant Achatz is the chef/owner of Alinea which is widely considered America’s best restaurant, and surely by now among the demonized 1 percent. But what many don’t know is that he got his start flipping eggs at his parents’ diner in Michigan.
Importantly, it’s not where we start in life that dictates where we end it, and having learned the basics as a child and teenager, Achatz eventually matriculated to the Culinary Institute of America. Once there, not content to rest on the achievement of having gotten in, Achatz skipped the “bars and partying” that animated the experiences of his classmates and instead “hit the gym every day and then spent each night reading cookbooks.” Early sacrifices that others wouldn’t make now have Achatz at the top of the culinary world.
He may not know it, but Achatz would have soulmate in the form of Aaron Rodgers, Super Bowl-winning quarterback of the Green Bay Packers. Those who only know the modern Rodgers story might think of a wildly talented athlete with a brilliant arm who only knows how to throw touchdown passes all the while collecting millions from his employer.
What they don’t know is the different path he took in high school so that he could get where he is today. As Rodgers’ high school friend Ryan Gulbrandsen told Sports Illustrated recently, “We both just decided that we wouldn’t be the kids who would party in high school.” Instead, Rodgers studied hard in school (1310 SATs), and also unrelentingly studied football film.
Despite all the work and sacrifice, as a high school senior Rodgers could claim stature of the 5’10”, 165-pound variety, which was decidedly not the stuff of Division 1 college football. Though he could have played in the Ivy League given his academic prowess, Rodgers went the JC route, impressed the coaches at Cal, eventually starred there, but even then he was forced to agonize on NFL Draft day as 23 teams passed him by in the first round.
Rodgers’ reward for waiting 23 picks with cameras fully trained on him was to be drafted by the Green Bay Packers; Brett Favre’s Packers. When Favre eventually left Green Bay Rodgers had to suffer a fan base very loyal to Favre, and that was none too happy to see him under center. The rest is history now, Rodgers is a few more great seasons away from the Hall of Fame, and his millions put him well into 1 percenter category. What’s unknown is how many of us 99-ers would have done what he did to get there.
It’s said also about Rodgers that during practice as a backup to Favre, that he “took every scout-team possession like it was the last possession of his life.” This rhymes with the stories basketball fans used to hear about Michael Jordan. The Jordan they saw on television possessed staggering talent, but less known was the fact that Jordan, much like Rodgers, approached every practice like it was his final game. Jordan and Rodgers, both one percenters, and both extraordinarily hard workers.
It should be said that right or wrong, much of the angst about the 1 percenters is directed at Wall Street, or the investment bankers and traders who supposedly get paid for “moving money around.” The naivete there is staggering.
As Schumpeter noted, investment bankers are capitalists par excellence for securing the capital that has enabled all the great individuals listed here to accomplish what they have. After that, it would be interesting to know if many in the Occupy crowd have friends in the investment banking world.
It seems they don’t, because if they did they’d understand that these providers of capital have no lives, particularly the ones who make the millions. Without defending the bank bailouts for one second, Wall Streeters are generally paid large sums because they’re engaging in work that very few know how to do, that is highly valued by the marketplace, and that can disappear with one bad deal. In short, we decry the financiers of our economic ascendance at our peril.
It was presumably F. Scott Fitzgerald who once observed that “the rich are different from you and me.” Yes they are. The rich, or as they say today, the 1 percent, generally work a lot harder and smarter than do the rest of us, and for doing so, make all of our lives easier, cheaper, and more entertaining.
What’s not said enough about the 1 percenters is how difficult were their paths, but perhaps even more to the point, how much easier and better our paths will be for what they did ahead of us. Rather than bemoan their wealth, it’s time we start thanking them.
John Tamny is editor of RealClearMarkets and Forbes Opinions, a senior economic adviser to H.C. Wainwright Economics, and a senior economic adviser to Toreador Research and Trading.
Further Reading: Here’s Why the Eurozone Solution is Fraught with Uncertainty>>