America’s Idiot Rich

Nice piece by Alex Pareene in 3 Quarks Daily from Salon today at:

The 1 percent is complaining louder than ever. There can be no reasoning with people this irrational

Some unknown but alarming number of ultra-rich Americans are now basically totally delusional and completely divorced from reality. This is now an inescapable fact, confirmed by multiple media accounts of billionaire thought and an entire special issue of the New York Times Magazine.

Here’s a brief list of insane things that are apparently common knowledge among the billionaire class:

  • That President Obama and the Democratic Party have treated wealthy finance industry titans maliciously and unfairly.
  • That the fact that they are perversely wealthy and growing richer during a period of mass unemployment and staggering debt is a sign that the economy is functioning correctly.
  • That poor people, and not the finance industry, are responsible for the financial crisis and subsequent recession.
  • That the ultra-wealthy are wealthy because they are smarter and work harder than everybody else, and that they are resented for their success.
  • That the ultra-wealthy in general, and finance industry executives in particular, are the victims of widespread prejudice akin to that faced by ethnic minorities.

There can be no reasoning with people this irrational. Any attempt to do so will fail, as Barack Obama, whose main goal is to maintain, not upend, the system that made these people so disgustingly wealthy, is learning. It’s growing harder and harder to pretend that the fantastically wealthy have a sophisticated understanding of politics — or math, or economics, or cause-and-effect.

The Times Magazine has the story of the Obama campaign’s difficulty in matching its record 2008 contributions from the finance sector. It contains this now surely infamous passage, a true marvel of that classic rich guy cocktail of self-pity mixed with self-regard:

One of the guests raised his hand; he knew how to solve the problem. The president had won plaudits for his speech on race during the last campaign, the guest noted. It was a soaring address that acknowledged white resentment and urged national unity. What if Obama gave a similarly healing speech about class and inequality? What if he urged an end to attacks on the rich? Around the table, some people shook their heads in disbelief.

The problem with inequality in America, you see, is apparently that it has led to rhetorical attacks on the winners of the class war. Greg Sargent wrote, in response to this story: “One wonders if there is anything Obama could say to make these people happy, short of declaring that rampant inequality is a good thing, in that it affirms the talent and industriousness of the deserving super rich.”

I’m not sure even that would help, because there is already another presidential candidate who likely believes that. In the same issue of the Times Magazine, we have the story of Edward Conard, a retired Bain Capital executive who is about to release a book (presumably against the wishes of his friend and former colleague Mitt Romney) arguing “aggressively” that massive wealth disparity is an unalloyed Good Thing. In fact, Conard thinks “the wealth concentrated at the top should be twice as large.” (Paul Krugmandoes not think much of his argument.)

Conard also detests charitable giving and has developed a statistical method for finding a spouse, because he is a sociopath. Because he is very wealthy, he is very used to his ideas being taken seriously — even economists offer him (qualified) praise. He is utterly convinced that his book will convince every serious person that wealthy finance industry titans not only deserve their wealth, but make society a better place for all. He has basically taken what is a gut feeling among his class and turned it into a philosophy and an argument.

Perhaps the most persuasive argument — for Republicans — for nominating Mitt Romney was that he is of this class. The fact that he is more comfortable in a boardroom than a Pizza Ranch is actually a major asset, because the Democrats had, since the Clinton years, gradually won over much of Wall Street, helping them to erode the GOP’s massive Reagan-era fundraising advantages. Romney can win that money back. Our friend Ed Conard even created a shell corporation for the sole purpose of secretly donating $1 million to Romney’s super PAC. The Sunlight Foundation shows in Figure 5 here that the share of finance money going to Democrats skyrocketed during Clinton’s first term, and rose again in 2008. Clinton rewarded his super-rich donors with extensive deregulation — and they rewarded him by shifting the majority of their donations back to the GOP. (Finance, naturally, likes to chase winners: They give more to whichever party seems to be on the upswing, as Obama learned in 2010 and will learn again this year.)

They are one of those industries that is used to getting exactly what it always wants from Washington, because they essentially own both parties. (As opposed to say, oil and gas, ally of Republicans, or the entertainment industry, ally of Democrats.) So Dodd-Frank made them very, very mad. But not just mad: Confused, hurt, betrayed. There is a psychosocial element to the response, clearly on display in the story of the rich people who wish for a speech about how they are not evil. They are essentially spoiled children who have just been lightly reprimanded for the first time that they can remember.

Obama has not been remotely unkind to Wall Street, even as he’s grudgingly adopted a slightly more leftist tone. The grotesque nature of our campaign finance system has effectively made economic populism impossible. Even populist rhetoric not backed up by any sort of action is apparently hurtful to these masters of the universe.

But Conard is wrong. The rich are not intrinsically more virtuous or hardworking than the masses. They are also, decidedly, not any smarter. And they receive their news, and their political opinions, from the exact same organs as everyone else. They may be more likely to read the Wall Street Journal than the New York Post, but both of those Murdoch-owned newspapers carry similar lies on their editorial pages. In other words, they actually believe their bullshit. They honestly believe that mean Democrats invented “Occupy Wall Street” in order to make them scapegoats for a crisis that they feel no responsibility for. People who are in the business of extracting fees and interest from consumers, or moving rich people’s money around, unironically think of themselves as “job creators.”

The result of their last few decades of job creation has been the decoupling of productivity grown from wage growth andskyrocketing compensation for CEOs and finance industry workers.

But appeals to logic, history and common sense will not get you far with a roomful of very rich guys who feel paranoid and victimized. The Wall Street types asked to become Obama donors wanted assurances that the president would not criticize his opponent’s finance industry record. It’s not enough that they’re ridiculously wealthy: They wish to be utterly above criticism. That’s the most important thing to remember: These people, the .01 percent, are mostly childish idiots. Idiot children have now accumulated all of the nation’s wealth and they are terrified that someone might try to take some of it away


About creativeconflictwisdom

I spent 32 years in a Fortune Five company working on conflict: organizational, labor relations and senior management. I have consulted in a dozen different business sectors and the US Military. I work with a local environmental non profit. I have written a book on the neuroscience of conflict, and its implications for conflict handling called Creative Conflict Wisdom (forthcoming).
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7 Responses to America’s Idiot Rich

  1. Kyrie Eleison says:

    There were a few seemingly independent points and ideas put forth by the author in this piece that struck a chord with me. Each one on their own merits are things that would provoke much discussion and debate.

    However, my thought processes tend to lean towards the macroscopic. Getting lost in minutiae and splitting hairs can be academically enriching, but in this case I’d have to say that the message I took away is much more simplistic, and is greater than the sum of its parts:

    ** Why on Earth should I care when I know full well that it is not possible for the feeling to be mutual? **

    In other words, I find it extremely difficult to be empathetic with people who lack the capacity, regardless of whether it is innate or merely a learned behavior. We can discuss it, study it, and so on ad nauseum but ultimately will it bring us any closer to a lasting conflict resolution?

    No matter how much we may understand each other, I can’t make someone care, and that ultimately is the crux.

    I’m willing and fully prepared to step outside of my comfort zone – I have serious reservations about whether this favor would be returned, and even if it was, that anything of substance would be learned from it.

    Perhaps when this fundamental question is adequately addressed and answered, there can be further meaningful discussion about all that other stuff.

    Apologies in advance for the perfect storm of cynicism, pessimism, and skepticism. My views are largely shaped pragmatically in some semblance of the scientific method, and to date I’ve yet to experience any meaningful evidence to the contrary. It is either becoming far more pervasive as I age, or perhaps I just need to get out more.

    • @Kyrie Eleison. Excellent points on which I have some views as Getting Empathetic is the critical third stage in the Creative Conflict Model (see top of Home Page) of this blog.

      I make a strong distinction between sympathy, which is what I think you are talking about, and which is hard for us in negotiating with people whose values seem to us to suck, and empathy, which I use to mean having a ‘theory of mind’ of the other side in conflict. By this, I mean we come to go beyond their positions and come to understand their interests, their emotions and their world view, without accepting them as valid in any objective sense; simply that they are how they see things. And often their perspective (like our own before we drill down to our real interests) is very positional: they want X. They demand Y. Whatever. They feel self righteous.

      I have negotiated with people, with whom I had no sympathy whatsoever, including a break away union with racist neo-Nazi leanings. Hostage negotiators negotiate to free hostages without any sympathy for the hostage takers. But they do come to understand them, their delusions even. It is very feasible and involves a mental detachment that can be demanding. The aim of the process is to creatively expand solution space. And so even in Washington, even with people refusing to compromise, it is still possible to use empathy, even if we use in as Sun Tzu the Chinese military strategist suggested to ‘know our enemy’ and fight them better.

      Unfortunately, the situation of conflict often causes us to lose any empathetic reading of the other side. I call this tendency Conflict Autism: the lack of theory of mind of the other side. As one of my military friends put it: ‘once we have been bombed, we switch off the radar’ which is opposite of what we need to do if we want a good outcome. Getting the other side to see its real long term interests is the ideal in Step 3 of the Creative Conflict Model. But failing that, we do it unilaterally. We uncover as best we can their real interests and try to come up with a deal that meets both our real interests (we have uncovered in Step 2 of the Creative Conflict Model) and theirs. It is best done by working through the whole 7 Step Model in writing….

      Hope this helps and yes it does work in my decades of experience using this approach as a professional negotiator.

      • Kyrie Eleison says:

        What I am getting at are those among us (whose figure is grossly underestimated in my opinion) for whom it is simply not possible to have any feelings of empathy whatsoever, i.e. sociopaths and their ilk, who succeed where others do not simply because they do not have those pesky “feelings” of moral responsibility to weigh them down.

        In essence, you can try to negotiate with them but all you will get is manipulation in order for them to get what they want. It must be tiring to have such a one-track mind, always living in the immediate moment, having no sense of history and no concern for the future.

        With the reptilian mind, these efforts are futile. You can calm it, you can placate it for a time, but in the end the world is its plaything and there for its sole amusement.

        Where do you think you fit in with someone like this?

        It’s interesting that the author uses the term “childish idiot” to describe them. Developmental psychologists assert that the mental development of young children is, to borrow from Sigmund Freud, largely (if not solely) id-based. A child screaming for some toy in the aisle of a supermarket is a relatively easy negotiation for obvious reasons. I trust you can extrapolate where I am going with this.

        A lot of people like to discount this notion, for whatever reason. If they look just like us, then there’s no way there could be a monster lurking within… however this form of denial is a huge part of why the shenanigans have been going on for so long. I am unsure if I had raised this issue before, but simply take a look at cases like John Wayne Gacy or even Jim Jones. Truly disgusting people surrounded by the unwitting who defend them until the bitter end. This is not conjecture or sensationalism, this is fact.

        Thank you for your thoughts and insight.

      • @Kyrie Eleison. I have negotiated with such sociopathic folk, though I think just based on the statistical sample of three decades of my negotiating, their number is relatively small. There are far more people who lapse into a bit of sociopathy some of the time. In either case, real or temporary sociopath, you need to make sure you have a rock solid BATNA or Best Alternative to a Negotiated Agreements. In other words, you need to know what you can do unilaterally without their agreeing and don’t settle on an agreement that is worse that your BATNA. In Iterative Prisoner’s Dilemma games, pathological defectors do well against naive cooperators, but do appalling against retaliators, and generally become shunned by the community. As a negotiator, I am a Tit for Tat player punishing sociopathic cheaters and as a species we are wired to do this even at cost to ourselves, and we are good at ganging up on cheaters and free riders, just as we eventually did on the Nazis. But we have been conned by a whole tribe of free riders aka the top 1% and many of them got to that position via mild sociopathy. My monster meter is pretty sensitive too. 🙂 In any event, to date I have not been taken by a sociopath so maybe my approach is at least partly proof against them?

  2. Kyrie Eleison says:

    I recoil at the notion that a person needs to lower oneself to the level of these types in order to effectively deal with them.

    I also have serious doubt as to whether or not we as a species are wired to root out the cheaters and free riders. This view may be clouded by the current social climate in this country. Simply take a look at the behaviors we reward and punish collectively.

    To borrow from your own idea in another discussion about the corporate world, if these are the kinds of behavior we signal to others as valuable and accepted, then it should come as no surprise when it spreads everywhere.

    Just one example to illustrate: I’ve read countless news articles about how some person or company either escaped prosecution entirely or had stupefyingly low penalties handed down simply as a function of having the resources to throw up a really good smokescreen and worm around the issue by focusing on loopholes, procedural technicalities, and so on. Then, as if in the same breath, these perpetrators become a little too vocal when they discover that there are people crawling out of the woodwork to return the favor. It’s okay to SLAPP people around, but when one is on the receiving end, suddenly there is a great wave of indignation over these “frivolous lawsuits”. I wonder why they have become so commonplace? These cause and effect dots have an uncanny ability to evade connection.

    Another point of contention is, who really has the power to combat something like this? I know I am not of the 1%, and I’m quite certain they could care less about my philosophical ideas. People like Michael Bloomberg, however, in fact do have this kind of power and when people like him get involved with a little self-policing and fire a salvo across the bow of one of their own it fills me with at least a small glimmer of hope for our future. Was this done to make a point ideologically, or was it done with self-preservation in mind? We can never be certain, but to me the underlying motivation makes a big difference. Regardless, there are far too few willing to rock the boat they are in and thus the status quo perpetuates.

    There was a bit in there about the practice of charitable giving, and in closing I’d like to share the following which I feel applies to this incessant need for praise, qualified or not:

    2 “So when you give to the needy, do not announce it with trumpets, as the hypocrites do in the synagogues and on the streets, to be honored by others. Truly I tell you, they have received their reward in full. 3 But when you give to the needy, do not let your left hand know what your right hand is doing, 4 so that your giving may be in secret. Then your Father, who sees what is done in secret, will reward you.” – Matthew 6:2-4

    (Note: I do not consider political contributions as “charitable giving” and to twist this passage to apply to them is disingenuous and appalling.)

    • @Kyrie Eleison. I don’t think we need to drop our standards at all in dealing with sociopaths. On the contrary we stick to them. Bill Ury’s approach is called principled interest based bargaining and it seeks to use both side’s interests creatively. Now of course the current corporatist world has plenty to depress us but that is part of the tactic: making us feel it is hopeless to contest it. But contest we must. and if you think how much nastier resistance the folk in Burma had to overcome or the Eastern Europeans, then what is asked of us is relatively minor. We do need some sort of strategy and what really disappointed me about Occupy Wall Street is that they were all opposition and no concrete right now demands. To be honest John McCain’s McCain Feingold Act was more of a threat to the political status quo as the Supreme Court showed by over turning it. The other problem we have is that the Democrats are culturally liberal, politically correct but most of them are completely into the status quo economically and it is only by changing the economic status quo that real change happens. And that will take time, wisdom and effort. I am with you on the hypocrisy of giving…

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