The history of wealth is not what most people have been taught or believe IMO … so here’s my take on it …
I got into a discussion on Facebook with an acquaintance of mine there, Michael Perez. He posted this:
History shows us that when wealth is forcibly redistributed, even with the best of intentions, those people who started out with the wealth tend to be exactly the same sort of people (if not the exact same people) who end up with a wealth when all is said and done.
We can also learn from history that If we want to reduce disparities of wealth, we can teach people to generate and communicate value while also teaching them how to delay gratification and manage resources.
Then I came back with this (very long) comment …( essay???)
Michael I “THINK” I get where you’re going, but where are you getting your data???
If we look at real data what we find is that “wealth” is typically created by a single driven individual (very Graves Five value-set orientation, e.g.: Giovanni di Bicci de Medici, Mayer Amschel Rothschild, Cornelius Vanderbuilt, John D. Rockerfeller, Joseph Kennedy – or much longer ago, a very Graves Three value-set orientation, e.g.: Alexander The Great, Ghangis Khan, Attilla The Hun …). This wealth was then passed onto succeeding generations and in some cases with the knowledge of how to manage and build it further.
With enough wealth came the possibility of manipulating the system further to retain the advantages that wealth brings, including the ability to further grow the wealth. This includes manipulating the political and legal systems via the “rulers” in place at any given time, e.g.: the Pope, the King/Queen, the Parliament, the President … whomever necessary.
In addition there is clear evidence that the legal system can be bought, despite the claim and public image of fairness and “rule of law” being evenly applied to all members of society. The reality is that your legal standing greatly increases based on who you are/know, and how much money you can apply to maintaining, defining and “buying” your rights in society, both criminally and civily.
Using the ability to gain momentum via accumulated wealth, including political and legal favoritism, even greater accumulation of wealth becomes possible. This is clearly evidenced in the history books.
The “best of the best” establish forms of protection that virtually guarantee that the wealth will be retained, e.g.: family offices (the legal entity), foundations and trusts. However these require a certain degree of wealth to establish and sustain in the first place.
Further if we follow those who are “new” to wealth and lack deep and proper guidance about maintaining and passing on their wealth what we find is that seldom does it last (maybe this is what you are saying, huh?). Instead succeeding generations squander the wealth they receive, because they’ve never learned how to generate it themselves, and there is an ever widening base of distribution, e.g.: children to grandchildren to great grandchildren … and so on … eventually eliminating sufficient concentration of wealth to sustain the dynasty. This is avoided when the proper mechanisms are in place and are not circumvented by succeeding generations … i.e.: family offices, foundations, trusts, etc.
Now we see that the possibility of accumulating truly significant wealth requires A) extraordinary luck and timing, i.e.: right place/right time/right idea … e.g.: Bill Gates, Richard Branson, Peter Theil, Mark Zuckerberg … B) willingness to do whatever it takes to circumvent the normal societal constraints and systems – including the collusion of the political and legal system surrounding them to make this possible, i.e.: transferring significant public wealth into private hands, e.g.: Mikhail Kordorkovsky, Carlos Slim, Lakshmi Mittal and on a lesser scale (financially) Dick Cheny and others … (a scheme theoretically perfected by Milton Friedman and the Chicago School), or C) becoming famous enough via talent or position to create an extraordinary success and draw incredible wealth to you, e.g.: Michael Jackson, Steven Spielberg, George Lucas, Bill Clinton, J.K. Rowling …
However the among the most common ways of accessing extraordinary wealth are the oldest … inherit it, marry into it, or accumulate it over many generations (this is more common that is widely know about, because the scions often seem to have come out of nowhere, versus being the result of “selective” breeding programs).
Now I come to your re-distribution comment directly … there is no clear evidence that in a fair system those who did not begin wealthy, but came into wealth had any less success retaining it than others. First of all there is just no data, and second of all there is no fair system – every system on the planet today and for the last few millenia has been rigged in favor of the already wealthy.
There is however evidence that a significant number of “poor” people given the chance will do what it takes, e.g.: get the required knowledge and skill, and then work relentlessly hard to accumulate wealth if given a reasonable chance. This is the immigrant tale in the U.S. that’s been running here for centuries and has produced the world’s greatest concentration of millionaires and billionaires. The challenge today is that the opportunities for doing this going forward is shrinking … NOT BECAUSE OF UNFAIR TAXATION AND WEALTH DISTRIBUTION … but rather because of the unfair leverage held by those already in possession of the wealth.
Limiting regulatory measures have always been a greater hinderance to the generation and accumulation of wealth than taxation. In fact with enough wealth taxation is merely a bother, almost without implication (see Warren Buffet’s statement about the taxes he pays versus his secretary). However, things like patents, licensing, government oversight and regulation, e.g.: FDA, intellectual property laws … make it far more difficult today to create wealth than just 100 years ago.
None of the above is to say that we don’t need a major re-hauling of the tax codes and re-thinking of the social systems in place. But for my money I’d re-think and overhaul the political and legal systems first any day. Then I’d educate the sheeple about the revolutions that have given them the freedoms they enjoy, those they dream about … and most importantly those they have lost.
I’d add in that what I think of as “real wealth” goes beyond just addressing financial considerations. When I think of what wealth is it’s more akin to Trevnanian’s character “Nicolai Hel” in his novel, “Shibumi.”
I’ve been making noise about this idea for many years (over two decades actually, going on three) … and most recently I’ve upped the ante so to speak, by coming out directly about my focus on developing a much more “yin” approach to balance the “yang” of the society with live in, with all of its excess.
Many years ago now I began expressing my ideas about wealth and the creation of “real wealth” … i.e.: that which leads to true personal freedom and liberty, which can only become present when you remove the concerns of finance from a central position in the overall consideration of wealth. I designed and delivered a program to this effect, ‘Secrets of Wealth Attraction Success” in 2005 and presented the strategies I’d uncovered that truly wealthy and successful families pass down from one generation to the next.
The real keys to wealth creation and retention are elusive for the average person who hasn’t absorbed the lessons of wealth from the time they were in the crib … at the dinner table … and in every interaction regarding it in their life. Instead of building the mindset held by virtually every wealthy individual since money was invented, the average person in today’s society is fed a pablum of lies literally designed to detain, distract and deny them from every entering the ranks of the truly wealthy.
Think about it …
- Who would the wealthy hire if no one would take minimum wages to do what they’re unwilling to do themselves?
- Also, when you understand leveraging and compounding wealth based on the labor of others, how would it be possible to create or accumulate great wealth if no one was willing to join the masses of the working poor?
There’s more I could add, but this should get you percolating if you’re of a resonant spirit.
I’m curious what you think about it all.
Joseph Riggio, Ph.D.
Architect & Designer of the MythoSelf Process and Soma-Semantics
P.S.: I want to pass along a free bonus handout from the “Seven Secrets of Wealth Attraction” program material I prepared that you can download, with some of the strategies and secrets I learned in my study of the truly wealthy, there’s nothing to sign up for, or sign in to, it’s just a link to download the PDF:
P.P.S.: I also converted the “Seven Secrets of Wealth Attraction Success” CD to a downloadable MP3 format and if you’re interested you can get that here: