“And here’s another important point. Since more wealth is only interesting from a RELATIVE point of view…that is, it is only useful when it gives you higher status…a normal, healthy human being cares more about “fairness” than he does about absolute wealth. Of course, fairness can mean practically anything you want it to mean. It can mean fairness of opportunity – as in, we all play by the same rules. Or it can mean fairness of outcome – as in, we all end up in the same place.”
But even in a more specific context, human nature lends itself to comparing ourselves to others. We don’t really perceive ourselves as rich or poor in the absolute sense; we tend to compare ourselves to our peer group. If you happen to socialize primarily with folks who make over a million dollars every year, you’re going to feel relatively “poor” in comparison even if you earn a six-figure salary. The reverse would be true if this exact same person primarily associated with people who made less than $100,000 and lived more modestly. It’s all relative.
And that’s the point being brought up by Bill Bonner of The Daily Reckoning. The quote above comes from a larger article he published on relative wealth. He has written NYT best-selling books on finances, debt, and other money-related concerns.
He reminds us that we may have started from the perspective of “fairness of opportunity,” in that we should all be provided with the same chance for success. However, the Occupy movement has pushed itself more toward “fairness of outcome.” They’re saying that it’s unfair that the top 1% have so much wealth and so much control. It’s unfair that they are able to game (and control) the system in such a way to maintain that top 1% position.
“In an up and coming economy, with limited government and low taxes – like the US in the early part of the last century – people care more about fairness of opportunity. People are making money. They’re creating status for themselves. Things change fast. You are responsible for creating your own wealth, power and status.
“Later, as the economy matures, fairness of outcome becomes more important. New wealth is harder to get. It’s harder to move “up” in society. People get a hold of the government and turn it into a zombie-protector. They use it to make sure the rich get richer and the poor stay poor.”
While I agree that old money more easily supports new money, it is still possible to “move up” in society. No one said that upward mobility was easy, but that’s a price you have to pay if you want to succeed, to be happy, and to give the next generation more opportunities than you were able to have.