11 ms·

What's behind rich people pretending to be self-made?

138 points by wilsonfiifi 9y ago

hkmurakami 9y ago
Shame. Especially now that social responsibility has decoupled from privilege. Such duty and stewardship helped justify and bring balance to their privilege in days past. No longer.
- Clubber 9y ago
  Well, we don't know if they are philanthropic or not, but they seem to be conflicted about their wealth. It's not so much them, but how much value our society puts on money.
dawhizkid 9y ago
I was maybe a little too excited to read "When to Jump" (https://www.amazon.com/When-Jump-Have-Isnt-Life/dp/1250124212 https://www.amazon.com/When-Jump-Have-Isnt-Life/dp/125012421...) about taking a big risk in making a major career/life change against perhaps the wishes and/or expectations of your family, friends, colleagues, society, etc from an author I hadn't heard of before (but somehow got Sheryl Sandberg to write the forward for and Reid Hoffman to endorse) who left a cushy VC/finance job to travel around the world to play squash for 2 years. After doing a little more research, I found that the author grew up in a wealthy east coast family, is a close blood relative to Sheryl Sandberg, went to an Ivy League school (likely aided by privileged upbringing and family connections), landed at a prestigious finance/VC firm straight from college (probably made possible again by an Ivy league pedigree/family connection), and could easily make the "jump" to doing something that paid nil for 2 years due to this enormous safety net of family wealth that most people simply don't have. If there's one thing about the Travis Kalanick saga I wish the media would've told is that he is a rare successful founder who legitimately grew up in a middle class family and struggled for many years post-college trying to get to ramen-profitability on a series of failing startups before hitting it big. This is strictly in contract to the Zucks and Spiegels of the world who grew up very wealthy and went to the best schools and could take on the big risks associated with entrepreneurship because if everything failed they still had that big safety net to fall back on.
- rvo 9y ago
  Thanks a lot for pointing this out. I wish there was a way of surfacing these connections for other authors, media personalities, founders, etc.
- amorphid 9y ago
  I saw Travis K. give a talk a few years back at Failcon in San Francisco about his previous startup Red Swoosh. What I remember about that talk is how he persevered through some serious s* which was the opposite of easy & fun. I'd add that while deciding when to jump, you should honestly assess whether you're really willing to go shopping for a fire extinguisher while simultaneously being burned alive.
- paul7986 9y ago
  I participated in at the time a no name incubator on the east coast(decade ago). Only one of the ten companies got funding and its founder had offers already going into the incubator. Offers all from his rich VC father’s other wealthy friends. I’d love to see a list of all the successful founders who came from extreme poverty. Middle class startuppers have one or two shots at it if they live at home with a relative. The rich kids can keep trying and learning from their mistakes until well they become richer. Such is life.
  - dawhizkid 9y ago
    Makes you wonder how different the world might be if society provided a similar safety net for aspiring entrepreneurs (at least psychologically) as coming from a wealthy family.
    - aaomidi 9y ago
      Personally for me, if I had some basic income, I'd be more willing to take a risk and potentially create hundreds of new jobs.
    - JBlue42 9y ago
      Well, this exists in most of Western Europe right? They do have entrepreneurs (and I'm not talking solely VC-funded startups here) but I've read that at times there's some cultural issues with 'going above your station' (thinking maybe Scandinavia). Maybe some of our European founders could detail that a bit more.
kapauldo 9y ago
I don't know why the writer think Americans link wealth with merit. I think Americans are suspicious of wealth because it's either lottery zuckerberg money or inherited trump money and most Americans know this.
darepublic 9y ago
This article implicitly assumes that intensity/amount of labour should translate directly into income. Dunno why it should, but it would be interesting to think of what the world would be like if that were truly manifested in reality. I wish upon all these socialist academics that they could live in such a world as they thoughtlessly describe/claim to desire.
- okonomiyaki3000 9y ago
  The article doesn't implicitly assume that at all. You seem to have missed the entire point.
  - airstrike 9y ago
    From the article: > Meanwhile, few who make the “I did it all myself” argument question the absurdity of seeing earnings as a measure of grit and moral worth. Does anyone really think that a CEO, whose pay is on average 271 times greater than that of his typical worker, works 271 times harder than his employees, who might actually be doing strenuous physical labor?
    - okonomiyaki3000 9y ago
      Exactly. Rather than "implicitly assuming" one thing, it quite explicitly states the opposite.
  - ams6110 9y ago
    I think it does. Whether it's the subhead about linking work and reward or Johannes Siegrist's study of "unfair compensation: “effort/reward imbalance” (ERI)" The implication is clear that some people are rewarded less for the same effort. Well not all effort is equally valuable. Anyone can sweep a floor, so the effort of doing so isn't worth much.
    - uyholes 9y ago
      This argument always seems backward to me, because the important issue with this topic isn't about the supply and demand for the floor sweeping, it's the assumption that the supply for the work of the CEO position is lacking, as opposed to restricted due to power structures or incentive for control of money. What I mean is, yes, everyone can sweep, the compensation is lower, but there is less power also. As you move up the hierarchy, you are not only potentially going up in skill, but also in the amount of power afforded and compensation enjoyed. Let's take a hypothetical case where all employees are equally skilled. Just for argument. Now you create positions of more and more power. By definition, there will be fewer positions of greater power, otherwise those higher positions would not have so much power. Because of the power those positions afford, there will be more competition for positions of more power, under the assumption that people want more power. Because those workers are all equally skilled, though, something other than skill must determine success in gaining those positions. And once they have those positions, they can use that power to increase their compensation relative to other employees. They can also use that power, consciously or subconsciously, to create or shape a narrative that they deserve that compensation more than others. This is hypothetical, and reality involves something in between the "floor sweepers get paid pennies because everyone can sweep" and "CEOs are randomly assorted into positions of unlimited power" but the point is that there are properties accrued by the inherent nature of power structures, and those properties lead to inequities just as much as supply and demand of skills. I can't believe that in the US the power structure side of reality is ignored so much in favor of the supply and demand side of reality, even when it's staring us in the face and glaringly obvious. And that you can't see society as complex and nuanced, and have to choose to be either a rabid capitalist or socialist.
jarsin 9y ago
It's not just pretending to be self made most of them run sham charities and universally lie about their own charity giving too. I'll never give to a rich pricks charity knowing what I know now.
- hkmurakami 9y ago
  Do they just raise funds but not disburse effectively?
  - jarsin 9y ago
    No they use the charities as a way to do business deals. Want the deal with the billionaires company...better give to his kid's charity etc.
  - jessaustin 9y ago
    It seems common for "personal" charities to have really high overhead. A typical cause would be that highly paid executives are actually family members with little commitment to the stated purposes of the charities.
    - candiodari 9y ago
      Or they deliver services directly to those executives. Particularly egregious example: https://nypost.com/2016/10/02/bill-clintons-executive-suite-is-a-private-pad-above-165m-library/ https://nypost.com/2016/10/02/bill-clintons-executive-suite-... (the story goes that back when executive compensation was highly taxed in the first part of the 20th century, many companies took out services for their executives which were tax free advantages. Things like yachts. Walt Disney is famous for building out a business for exactly that sort of thing : https://en.wikipedia.org/wiki/Club_33 https://en.wikipedia.org/wiki/Club_33 )
      - zimpenfish 9y ago
        Not that egregious considering > Clinton isn’t the only former president to include a residence in his library. George H.W. Bush’s library at Texas A&M University in College Station and Jimmy Carter’s in Atlanta both have them.
airstrike 9y ago
One's (monetary) value isn't defined by one's amount or intensity of labor, but rather by the value lost should one be removed from the equation. Factory workers can be replaced by virtually anyone else (and often by machines) while Hedge Fund traders / managers often cannot. While algorithms are increasingly prevalent in Wall Street, at the end of the day there's a human who either writes them or reads their output before making a decision, and that person is not easily replaceable. Beyond that, for every successful Hedge Fund there are countless that failed catastrophically, so any analysis of "how much a Hedge Fund manager makes" is subject to severe survivorship bias. [0] The disparity between the CEO of a public company and its hordes of workers is even clearer. Very few people possess the combination of skills that make a high-caliber CEO successful, which is why very few people are rewarded like them. LeBron James also doesn't work 1,000 times harder than a factory worker. Finally, it's worth remembering that 70% of wealthy families lose their wealth by the second generation, and a stunning 90% by the third. [1] I wouldn't lose any sleep over rich kids who feel troubled about their "entitlement". [0] https://xkcd.com/1827/ https://xkcd.com/1827/ [1] http://time.com/money/3925308/rich-families-lose-wealth/ http://time.com/money/3925308/rich-families-lose-wealth/
- lovich 9y ago
  I'd have to disagree with your point about CEO's having rare skills. CEOs appear to not be rated against anything. you have giant failures like Yahoo under Mayer or the executives at Toys R Us giving themselves bonuses as they are going through bankruptcy. Instead of not getting compensated for their failure they are getting amounts of money that most Americans could retire in. When the business does well people say it's due to the CEO, but when they fail people argue about how bad it might have been. There's no way to know. It seems more like a scam vs investors or employees than some measurements skill that actually merits compensation
  - Banthum 9y ago
    We don't know how Yahoo would've done under someone else. It could've been much worse. It's perfectly possible Mayer did unique work that paid her compensation and much more in savings. Without the counterfactual, we cannot judge her.
jzymbaluk 9y ago
My experience, having dealt with successful people who were also born rich, is that they often legitimately feel that they are self-made. Because the truth is that no matter how privileged you are, you do still have to put the work in if you want to be successful. It is true that rich people have much better safety nets, but being successful will always take at least some level of hard work. It's difficult to have the perspective it takes to admit that your success may be more due to a privileged starting position and luck than solely the hard work, especially when it's so easy to claim all your success is self-made and the hero worship of self made people in the United States
- jdtang13 9y ago
  I attended a talk hosted by a wealthy founder who was born into privilege, and he said something like this: "Startups are really hard. You need to use every card that you've been dealt in order to succeed."
  - hkmurakami 9y ago
    That's what meritocracy is, really. It's a system that rewards the most physically fit, the most genetically endowed, the people with the most resource rich support system, etc. It's not necessarily a bad thing, but the fact that we're conditioned to think that a non level playing field is bad no matter what (vs a societal expectation that those with the most must give back the most), asking with a fetishistic of monetary success, really warps our outward facing behavior.
    - cimmanom 9y ago
      How is a strong support system that one was born into reflective of "merit"?
    - BoiledCabbage 9y ago
      > the people with the most resource rich support system, etc. I'm not sure you even realize, but that's the exact opposite of the definition of meritocracy.
everdev 9y ago
If my skill is common, it doesn't matter how much physical energy I expend, I probably won't make much because the supply of labor is high. If it was easy to be a hedge fund manager, more people would do it. It's easy to cherry pick these professions that seem overpaid, but in a free market, people tend to make what the market values them at. You could say that teachers are so important that they should be paid more and in a free market education system they might be paid differently than they are now.
- tetron 9y ago
  Or maybe certain professions have a limited number of openings, which tend to go to people with connections, and cooincidentally these professions deal with large amounts of money, so taking 1% commission on a hundred million dollar deal for very little work seems reasonable.
  - ghufran_syed 9y ago
    So why assume hedge fund managers get their jobs through “connections” but professional basketball players don’t?
    - harry8 9y ago
      Why would you assume the converse? Hedgefund managers and more junior employees deal with ie sell to the rich, be they extremely wealthy or others in the finance industry. Do you think that's going to work better as Dennis Rodman or James Van Der Something with the accent and style to match? Dennis got a game to rack up his astounding numbers because he's very tall. He wouldn't get a game as fund manager as 25 year old no matter how smart he was. I'm a CFA, I have grades, never got a look in for fund manager jobs. Pivoted to computing at the age of 30 where I "look the part" or whatever. Don't kid yourself about this stuff. I'm not from an underprivileged background by any stretch of the imagination and nor do I have any time for socialism and socialist posing. Young Dennis will get a game somewhere and put up compelling numbers and will likely get to the NBA. The equivalent can't be said for young potential fund managers who won't get a chance to impress. Positive discrimination is not the answer to this, but neither is the ostrich strategy.
ryandrake 9y ago
I've met my share of "self made" people who when self-classifying as such, ignore things like: * Well-off parents who funded their education, allowing them to start off without the huge debt ball-and-chain most of us start off with. * Well-off family who can act as a safety net / backstop for failed risk-taking. Baseball is easy if you can keep swinging until you hit the ball. * Well-connected family or friends who helped with that critical first job, which often can set an entire career's trajectory. * Pre-populated contact list of well-off or well-connected people, drawn from family or Ivy league classmates. I don't think you can honestly call yourself self-made with these advantages.
- wmccullough 9y ago
  cough Tim Ferriss cough
  - jhwang5 9y ago
    It's amazing how many people buy his story, given he grew up in Hamptons, went to boarding schools all his life, went to Princeton with no student loans, etc
- joshontheweb 9y ago
  I get your point but where do you draw the line? It seems pretty subjective. Who truly starts off with nothing? EDIT: spelling
  - bilbo0s 9y ago
    The truly poor do. Although even they have, at least, access to the public infrastructure of the nations that they live in. France, Kenya, China, Argentina, the US etc. It's not much... but it's something.
  - dragonwriter 9y ago
    > Who truly starts off with nothing? No one; everyone starts off in a particular social context with a particular set of assets and opportunities and limitations. There's no need to draw a line; there's no valid binary classification here.
stmfreak 9y ago
I've come to realize that hard work is not what we get paid to do from 9-5 each working day, but what we choose to do with our spare time that either improves or degrades our position in life. And it is the thousands of choices from early years through middle age that separate those with rarified skills and high wages from those with common skills and envy for their higher paid, lesser working (now) friends. It does not matter where you start. When you spend most of your life studying or smoking dope, the end is predictable.
- acct1771 9y ago
  What about if you do both?
- WWLink 9y ago
  You make a valid point, but a lot of people spend their spare time studying common skills - basically free training for their current and/or future employers. At least, I feel that way..
- uyholes 9y ago
  The problems we face today are not explained by the difference between studying or smoking dope. There's something more pernicious involved. Yes, if you smoke dope all the time your outcomes in life will probably be worse than if you study some "rarified" skill, to borrow your phrase. But studying takes resources, and time, and those are bought through money and social connections and luck. And increasingly, despite what we read about MOOCs and the new educational order, it doesn't matter if we study and learn, what matters is that we have a certificate of studying, a placeholder. And those placeholders are not the same as our knowledge, or one's ability to learn, and are subject to corruption and greasing like every other placeholder. And in the end, what does this say about how much value we should place on that rarified skill? Does our society really allocate financial reward according to actual value? Does Amazon really improve my life that much compared to the plumber or electrician who fixed my house? Is Facebook a net benefit to society? If it disappeared tomorrow, would nothing replace it? Could our healthcare be delivered under a different provider structure? Do I pay my ISP because it's the best of many choices, or because it's acceptable enough to not go without internet access? Is Amazon successful because of Bezos in particular? If Bezos was going around spouting all the ideas in his head, marshaling an army of imaginary workers, without any actual labor, would we still have Amazon? The point of this article is it's trivial to point out that hard work should and often is compensated. The problem is that the compensation structures in many fields are completely absurd in many cases relative to the actual value created.
jnordwick 9y ago
Oh please HN, stop posting articles that are 100% political theory without a single link to tech. At the least, please create a category for naked politics. No, hide doesnt work very well (multiple devices, times out, etc). One time a mod told me that articles with no link to tech got deleted. That really doesn't appear to be the. This is yet another capitalist vs communist (literally, the labor theory of value was a Marx thing) diatribe that has no relation to the tech oriented stuff many came here for. There are plenty of other political sites for stuff like this. I often wonder, if you could vote down stories, these would probably have a severe split and maybe not make the front page or stay there. Only being able to upvote let's a small contingent push something up (just ask the bitcoin people).
- dragonwriter 9y ago
  If you think it's off-topic, then click “flag” and move on.
  - jnordwick 9y ago
    I did. And hid it. Now I'll just have to hide it everywhere else, and ignore when it comes up looking through through old articles and search results. Just because you can flag isn't carte blanche to post anything. I like the site much better (and I'm sure many others too) when it stays in its technical oriented wheelhouse.
    - dragonwriter 9y ago
      > Just because you can flag isn't carte blanche to post anything Just because you have certain preferences isn't carte blanche to launch off-topic diatribes in threads on articles that don't adhere to them about how you prefer HN should be focussed. > I like the site much better (and I'm sure many others too) when it stays in its technical oriented wheelhouse. That is neither the official focus [0] nor, evidently—from what the community submits and keeps on the front page—the consensus of the community. [0] From the guidelines: “On-Topic: Anything that good hackers would find interesting. That includes more than hacking and startups. If you had to reduce it to a sentence, the answer might be: anything that gratifies one's intellectual curiosity.” Obviously, whether any particular article meets they standard is subjective, which is why we have upvotes and flags and algorithms taking them and other factors (e.g., the flamewsr detector) into account.
Swizec 9y ago
My favorite quote on the topic comes from Arnold Schwarzenegger, arguably one of the most self-made people you can find. He said: "I am not a self-made man. Every time I give a speech at a business conference, or speak to college students, or do a Reddit AMA, someone says it. “Governor/Governator/Arnold/Arnie/Schwarzie/Schnitzel (depending on where I am), as a self-made man, what’s your blueprint for success?” They’re always shocked when I thank them for the compliment but say, “I am not a self-made man. I got a lot of help.”
- okonomiyaki3000 9y ago
  In Japan, we call him Shuwa-chan.
  - yread 9y ago
    where do they have the best okonomiyaki? :)
    - okonomiyaki3000 9y ago
      Off topic.
hi-im-mi-ih 9y ago
I can't wait for my own success and fortune. After I've sacrificed my personal life and weekends for ten years, I'm glad that reputable, non-biased publications like the Guardian will have fed the rest of the population an ideology that places me as a undeserving oppressor, regardless of my individual characteristics or political viewpoint. That way, I'll only have to wait a year or two before I'm thrown in the White Privilege (TM) gulags, to spend the rest of my days carrying 100 lbs. bags of salt from one end of the gulag to the next. Thanks, The Guardian!
- ahstilde 9y ago
  I fear you're taking this article too personally. No one is discounting your personal sacrifice. You work damn hard. You stay in when others go out drinking. You've done this for a long time, and you're working towards the payout. That takes an immeasurable amount of perseverance. The Guardian is not discounting you or your efforts. The Guardian is saying: there are those with a safety net to experiment, and there are those without a safety net. When we look at the achievements of both populations, is it truly fair to compare those with such different circumstances?
  - candiodari 9y ago
    It's saying more than that. It's saying that you may get nowhere unless you have the connections high up in other companies that you'll only have if you're rich to begin with. Without those, in many cases, no amount of perseverance will pay off.
- dang 9y ago
  Could you please not post ideological rants to HN, regardless of how wrong someone or some publication is? It makes for lousy conversation, and HN is supposed to be for good conversation. One needn't approve of The Guardian to see this. https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html
  - hi-im-mi-ih 9y ago
    Sorry Dang. I'll try to not do this in the future, as it does make HN a worse place for everyone.
jim-jim-jim 9y ago
"When a man tells you he got rich through hard work, ask him 'whose?'"
HumanDrivenDev 9y ago
IME, most people want to craft a narrative that lets them feel OK about themselves without too much introspection. If their lives are good, they'll take credit for their fortune like the people in the article. If their lives are bad, they'll blame everyone but themselves. I've made a small jump in socio-economic class, and I try and keep it in perspective. I try and remember the bits of help I got a long the way. And at the same time I'm trying to let go of my resentment about people whose parents set them up with cars, tuition and house deposits - because one day I hope to be that parent.
- fjsolwmv 9y ago
  Why not be a better parent and citizen than that, instead if spoiling your children?
  - HumanDrivenDev 9y ago
    Biology I suppose
RhysU 9y ago
Where is the line between transferring property and transferring advantage?
mrep 9y ago
> Does anyone really think that a CEO, whose pay is on average 271 times greater than that of his typical worker, works 271 times harder than his employees, who might actually be doing strenuous physical labor? I'm not against the general mindset the author is telling, but this garbage thought process needs to stop. This isn't about working harder, but smarter and you can easily provide 271 times more value through decisions that higher ups are tasked with than a bottom level individual contributor. ***Anecdotal*** The top level people at my company are making decisions daily that govern multi-million dollar investments which can be vastly beneficial or detrimental to our profitability. When working on investments that large in size, marginal improvements on decision making provide huge sums of value which somewhat justify the pay. Now, are these people self made? That's more open to debate but every C*O and SVP has been with the company for at least 10 years and most VPs also have also been here for that long/have an amazing track record. You generally don't get 10+ years of promotions providing nothing.
- knightofmars 9y ago
  There have been many studies surrounding CEOs.[1] A large portion of them keep showing that a bad CEO is worse than no CEO, an average CEO likely isn't actually doing anything, and a good CEO is probably just lucky. This topic has been researched and had the data poured over to the ends of the earth to find that "special CEO sauce". The reality? There is likely a tiny subset of all CEOs that are actually worth 271 times what the typical worker is making (Steve Jobs comes to mind). That subset of actual talented visionary CEOs is probably a ridiculously small number (eg 1% of CEOs in a global pool). The rest of the time it's just a good ol' boys club for the already rich. [1] an example https://hbr.org/2015/11/are-successful-ceos-just-lucky https://hbr.org/2015/11/are-successful-ceos-just-lucky
TheFullStack 9y ago
To be fair, people are not born with a built-in frame of reference. I used to think I was good at math due to hard work/dedication but I have since met people who worked far harder than me and still were not nearly as good at math. It works the same way with money and pretty much everything. Good-looking people think they are charming, naturally athletic people think they train harder, etc. It's just what it is.
deleted 9y ago
[deleted]
deleted 9y ago
[deleted]
suff 9y ago
What's with clueless authors and confirmation bias?
Balgair 9y ago
In reading the reactions to the article, it seems like most of HN is onto the game: Feign poverty. That said, whom are some people that really did 'make it' from rags to riches? What can we learn from them? I'll start: Andrew Carnegie Jack London George Soros Larry Ellison Ursula Burns Ingvar Kamprad JK Rowling Sam Walton Oprah The only thing that I can think of that all of them had in common was that they were really hard workers that got lucky. That hard work was the price of the lotto ticket. What am I missing here?

138 points by wilsonfiifi 9y ago

Shame. Especially now that social responsibility has decoupled from privilege. Such duty and stewardship helped justify and bring balance to their privilege in days past. No longer.

Clubber 9y ago
Well, we don't know if they are philanthropic or not, but they seem to be conflicted about their wealth. It's not so much them, but how much value our society puts on money.

dawhizkid 9y ago

I was maybe a little too excited to read "When to Jump" (https://www.amazon.com/When-Jump-Have-Isnt-Life/dp/1250124212 https://www.amazon.com/When-Jump-Have-Isnt-Life/dp/125012421...) about taking a big risk in making a major career/life change against perhaps the wishes and/or expectations of your family, friends, colleagues, society, etc from an author I hadn't heard of before (but somehow got Sheryl Sandberg to write the forward for and Reid Hoffman to endorse) who left a cushy VC/finance job to travel around the world to play squash for 2 years. After doing a little more research, I found that the author grew up in a wealthy east coast family, is a close blood relative to Sheryl Sandberg, went to an Ivy League school (likely aided by privileged upbringing and family connections), landed at a prestigious finance/VC firm straight from college (probably made possible again by an Ivy league pedigree/family connection), and could easily make the "jump" to doing something that paid nil for 2 years due to this enormous safety net of family wealth that most people simply don't have. If there's one thing about the Travis Kalanick saga I wish the media would've told is that he is a rare successful founder who legitimately grew up in a middle class family and struggled for many years post-college trying to get to ramen-profitability on a series of failing startups before hitting it big. This is strictly in contract to the Zucks and Spiegels of the world who grew up very wealthy and went to the best schools and could take on the big risks associated with entrepreneurship because if everything failed they still had that big safety net to fall back on.

rvo 9y ago
Thanks a lot for pointing this out. I wish there was a way of surfacing these connections for other authors, media personalities, founders, etc.
amorphid 9y ago
I saw Travis K. give a talk a few years back at Failcon in San Francisco about his previous startup Red Swoosh. What I remember about that talk is how he persevered through some serious s* which was the opposite of easy & fun. I'd add that while deciding when to jump, you should honestly assess whether you're really willing to go shopping for a fire extinguisher while simultaneously being burned alive.
paul7986 9y ago
I participated in at the time a no name incubator on the east coast(decade ago). Only one of the ten companies got funding and its founder had offers already going into the incubator. Offers all from his rich VC father’s other wealthy friends. I’d love to see a list of all the successful founders who came from extreme poverty. Middle class startuppers have one or two shots at it if they live at home with a relative. The rich kids can keep trying and learning from their mistakes until well they become richer. Such is life.
- dawhizkid 9y ago
  Makes you wonder how different the world might be if society provided a similar safety net for aspiring entrepreneurs (at least psychologically) as coming from a wealthy family.
  - aaomidi 9y ago
    Personally for me, if I had some basic income, I'd be more willing to take a risk and potentially create hundreds of new jobs.
  - JBlue42 9y ago
    Well, this exists in most of Western Europe right? They do have entrepreneurs (and I'm not talking solely VC-funded startups here) but I've read that at times there's some cultural issues with 'going above your station' (thinking maybe Scandinavia). Maybe some of our European founders could detail that a bit more.

kapauldo 9y ago

I don't know why the writer think Americans link wealth with merit. I think Americans are suspicious of wealth because it's either lottery zuckerberg money or inherited trump money and most Americans know this.

darepublic 9y ago

This article implicitly assumes that intensity/amount of labour should translate directly into income. Dunno why it should, but it would be interesting to think of what the world would be like if that were truly manifested in reality. I wish upon all these socialist academics that they could live in such a world as they thoughtlessly describe/claim to desire.

okonomiyaki3000 9y ago
The article doesn't implicitly assume that at all. You seem to have missed the entire point.
- airstrike 9y ago
  From the article: > Meanwhile, few who make the “I did it all myself” argument question the absurdity of seeing earnings as a measure of grit and moral worth. Does anyone really think that a CEO, whose pay is on average 271 times greater than that of his typical worker, works 271 times harder than his employees, who might actually be doing strenuous physical labor?
  - okonomiyaki3000 9y ago
    Exactly. Rather than "implicitly assuming" one thing, it quite explicitly states the opposite.
- ams6110 9y ago
  I think it does. Whether it's the subhead about linking work and reward or Johannes Siegrist's study of "unfair compensation: “effort/reward imbalance” (ERI)" The implication is clear that some people are rewarded less for the same effort. Well not all effort is equally valuable. Anyone can sweep a floor, so the effort of doing so isn't worth much.
  - uyholes 9y ago
    This argument always seems backward to me, because the important issue with this topic isn't about the supply and demand for the floor sweeping, it's the assumption that the supply for the work of the CEO position is lacking, as opposed to restricted due to power structures or incentive for control of money. What I mean is, yes, everyone can sweep, the compensation is lower, but there is less power also. As you move up the hierarchy, you are not only potentially going up in skill, but also in the amount of power afforded and compensation enjoyed. Let's take a hypothetical case where all employees are equally skilled. Just for argument. Now you create positions of more and more power. By definition, there will be fewer positions of greater power, otherwise those higher positions would not have so much power. Because of the power those positions afford, there will be more competition for positions of more power, under the assumption that people want more power. Because those workers are all equally skilled, though, something other than skill must determine success in gaining those positions. And once they have those positions, they can use that power to increase their compensation relative to other employees. They can also use that power, consciously or subconsciously, to create or shape a narrative that they deserve that compensation more than others. This is hypothetical, and reality involves something in between the "floor sweepers get paid pennies because everyone can sweep" and "CEOs are randomly assorted into positions of unlimited power" but the point is that there are properties accrued by the inherent nature of power structures, and those properties lead to inequities just as much as supply and demand of skills. I can't believe that in the US the power structure side of reality is ignored so much in favor of the supply and demand side of reality, even when it's staring us in the face and glaringly obvious. And that you can't see society as complex and nuanced, and have to choose to be either a rabid capitalist or socialist.

jarsin 9y ago

It's not just pretending to be self made most of them run sham charities and universally lie about their own charity giving too. I'll never give to a rich pricks charity knowing what I know now.

hkmurakami 9y ago
Do they just raise funds but not disburse effectively?
- jarsin 9y ago
  No they use the charities as a way to do business deals. Want the deal with the billionaires company...better give to his kid's charity etc.
- jessaustin 9y ago
  It seems common for "personal" charities to have really high overhead. A typical cause would be that highly paid executives are actually family members with little commitment to the stated purposes of the charities.
  - candiodari 9y ago
    Or they deliver services directly to those executives. Particularly egregious example: https://nypost.com/2016/10/02/bill-clintons-executive-suite-is-a-private-pad-above-165m-library/ https://nypost.com/2016/10/02/bill-clintons-executive-suite-... (the story goes that back when executive compensation was highly taxed in the first part of the 20th century, many companies took out services for their executives which were tax free advantages. Things like yachts. Walt Disney is famous for building out a business for exactly that sort of thing : https://en.wikipedia.org/wiki/Club_33 https://en.wikipedia.org/wiki/Club_33 )
    - zimpenfish 9y ago
      Not that egregious considering > Clinton isn’t the only former president to include a residence in his library. George H.W. Bush’s library at Texas A&M University in College Station and Jimmy Carter’s in Atlanta both have them.

airstrike 9y ago

One's (monetary) value isn't defined by one's amount or intensity of labor, but rather by the value lost should one be removed from the equation. Factory workers can be replaced by virtually anyone else (and often by machines) while Hedge Fund traders / managers often cannot. While algorithms are increasingly prevalent in Wall Street, at the end of the day there's a human who either writes them or reads their output before making a decision, and that person is not easily replaceable. Beyond that, for every successful Hedge Fund there are countless that failed catastrophically, so any analysis of "how much a Hedge Fund manager makes" is subject to severe survivorship bias. [0] The disparity between the CEO of a public company and its hordes of workers is even clearer. Very few people possess the combination of skills that make a high-caliber CEO successful, which is why very few people are rewarded like them. LeBron James also doesn't work 1,000 times harder than a factory worker. Finally, it's worth remembering that 70% of wealthy families lose their wealth by the second generation, and a stunning 90% by the third. [1] I wouldn't lose any sleep over rich kids who feel troubled about their "entitlement". [0] https://xkcd.com/1827/ https://xkcd.com/1827/ [1] http://time.com/money/3925308/rich-families-lose-wealth/ http://time.com/money/3925308/rich-families-lose-wealth/

lovich 9y ago
I'd have to disagree with your point about CEO's having rare skills. CEOs appear to not be rated against anything. you have giant failures like Yahoo under Mayer or the executives at Toys R Us giving themselves bonuses as they are going through bankruptcy. Instead of not getting compensated for their failure they are getting amounts of money that most Americans could retire in. When the business does well people say it's due to the CEO, but when they fail people argue about how bad it might have been. There's no way to know. It seems more like a scam vs investors or employees than some measurements skill that actually merits compensation
- Banthum 9y ago
  We don't know how Yahoo would've done under someone else. It could've been much worse. It's perfectly possible Mayer did unique work that paid her compensation and much more in savings. Without the counterfactual, we cannot judge her.

jzymbaluk 9y ago

My experience, having dealt with successful people who were also born rich, is that they often legitimately feel that they are self-made. Because the truth is that no matter how privileged you are, you do still have to put the work in if you want to be successful. It is true that rich people have much better safety nets, but being successful will always take at least some level of hard work. It's difficult to have the perspective it takes to admit that your success may be more due to a privileged starting position and luck than solely the hard work, especially when it's so easy to claim all your success is self-made and the hero worship of self made people in the United States

jdtang13 9y ago
I attended a talk hosted by a wealthy founder who was born into privilege, and he said something like this: "Startups are really hard. You need to use every card that you've been dealt in order to succeed."
- hkmurakami 9y ago
  That's what meritocracy is, really. It's a system that rewards the most physically fit, the most genetically endowed, the people with the most resource rich support system, etc. It's not necessarily a bad thing, but the fact that we're conditioned to think that a non level playing field is bad no matter what (vs a societal expectation that those with the most must give back the most), asking with a fetishistic of monetary success, really warps our outward facing behavior.
  - cimmanom 9y ago
    How is a strong support system that one was born into reflective of "merit"?
  - BoiledCabbage 9y ago
    > the people with the most resource rich support system, etc. I'm not sure you even realize, but that's the exact opposite of the definition of meritocracy.

everdev 9y ago

If my skill is common, it doesn't matter how much physical energy I expend, I probably won't make much because the supply of labor is high. If it was easy to be a hedge fund manager, more people would do it. It's easy to cherry pick these professions that seem overpaid, but in a free market, people tend to make what the market values them at. You could say that teachers are so important that they should be paid more and in a free market education system they might be paid differently than they are now.

tetron 9y ago
Or maybe certain professions have a limited number of openings, which tend to go to people with connections, and cooincidentally these professions deal with large amounts of money, so taking 1% commission on a hundred million dollar deal for very little work seems reasonable.
- ghufran_syed 9y ago
  So why assume hedge fund managers get their jobs through “connections” but professional basketball players don’t?
  - harry8 9y ago
    Why would you assume the converse? Hedgefund managers and more junior employees deal with ie sell to the rich, be they extremely wealthy or others in the finance industry. Do you think that's going to work better as Dennis Rodman or James Van Der Something with the accent and style to match? Dennis got a game to rack up his astounding numbers because he's very tall. He wouldn't get a game as fund manager as 25 year old no matter how smart he was. I'm a CFA, I have grades, never got a look in for fund manager jobs. Pivoted to computing at the age of 30 where I "look the part" or whatever. Don't kid yourself about this stuff. I'm not from an underprivileged background by any stretch of the imagination and nor do I have any time for socialism and socialist posing. Young Dennis will get a game somewhere and put up compelling numbers and will likely get to the NBA. The equivalent can't be said for young potential fund managers who won't get a chance to impress. Positive discrimination is not the answer to this, but neither is the ostrich strategy.

ryandrake 9y ago

I've met my share of "self made" people who when self-classifying as such, ignore things like: * Well-off parents who funded their education, allowing them to start off without the huge debt ball-and-chain most of us start off with. * Well-off family who can act as a safety net / backstop for failed risk-taking. Baseball is easy if you can keep swinging until you hit the ball. * Well-connected family or friends who helped with that critical first job, which often can set an entire career's trajectory. * Pre-populated contact list of well-off or well-connected people, drawn from family or Ivy league classmates. I don't think you can honestly call yourself self-made with these advantages.

wmccullough 9y ago
cough Tim Ferriss cough
- jhwang5 9y ago
  It's amazing how many people buy his story, given he grew up in Hamptons, went to boarding schools all his life, went to Princeton with no student loans, etc
joshontheweb 9y ago
I get your point but where do you draw the line? It seems pretty subjective. Who truly starts off with nothing? EDIT: spelling
- bilbo0s 9y ago
  The truly poor do. Although even they have, at least, access to the public infrastructure of the nations that they live in. France, Kenya, China, Argentina, the US etc. It's not much... but it's something.
- dragonwriter 9y ago
  > Who truly starts off with nothing? No one; everyone starts off in a particular social context with a particular set of assets and opportunities and limitations. There's no need to draw a line; there's no valid binary classification here.

stmfreak 9y ago

I've come to realize that hard work is not what we get paid to do from 9-5 each working day, but what we choose to do with our spare time that either improves or degrades our position in life. And it is the thousands of choices from early years through middle age that separate those with rarified skills and high wages from those with common skills and envy for their higher paid, lesser working (now) friends. It does not matter where you start. When you spend most of your life studying or smoking dope, the end is predictable.

acct1771 9y ago
What about if you do both?
WWLink 9y ago
You make a valid point, but a lot of people spend their spare time studying common skills - basically free training for their current and/or future employers. At least, I feel that way..
uyholes 9y ago
The problems we face today are not explained by the difference between studying or smoking dope. There's something more pernicious involved. Yes, if you smoke dope all the time your outcomes in life will probably be worse than if you study some "rarified" skill, to borrow your phrase. But studying takes resources, and time, and those are bought through money and social connections and luck. And increasingly, despite what we read about MOOCs and the new educational order, it doesn't matter if we study and learn, what matters is that we have a certificate of studying, a placeholder. And those placeholders are not the same as our knowledge, or one's ability to learn, and are subject to corruption and greasing like every other placeholder. And in the end, what does this say about how much value we should place on that rarified skill? Does our society really allocate financial reward according to actual value? Does Amazon really improve my life that much compared to the plumber or electrician who fixed my house? Is Facebook a net benefit to society? If it disappeared tomorrow, would nothing replace it? Could our healthcare be delivered under a different provider structure? Do I pay my ISP because it's the best of many choices, or because it's acceptable enough to not go without internet access? Is Amazon successful because of Bezos in particular? If Bezos was going around spouting all the ideas in his head, marshaling an army of imaginary workers, without any actual labor, would we still have Amazon? The point of this article is it's trivial to point out that hard work should and often is compensated. The problem is that the compensation structures in many fields are completely absurd in many cases relative to the actual value created.

jnordwick 9y ago

Oh please HN, stop posting articles that are 100% political theory without a single link to tech. At the least, please create a category for naked politics. No, hide doesnt work very well (multiple devices, times out, etc). One time a mod told me that articles with no link to tech got deleted. That really doesn't appear to be the. This is yet another capitalist vs communist (literally, the labor theory of value was a Marx thing) diatribe that has no relation to the tech oriented stuff many came here for. There are plenty of other political sites for stuff like this. I often wonder, if you could vote down stories, these would probably have a severe split and maybe not make the front page or stay there. Only being able to upvote let's a small contingent push something up (just ask the bitcoin people).

dragonwriter 9y ago
If you think it's off-topic, then click “flag” and move on.
- jnordwick 9y ago
  I did. And hid it. Now I'll just have to hide it everywhere else, and ignore when it comes up looking through through old articles and search results. Just because you can flag isn't carte blanche to post anything. I like the site much better (and I'm sure many others too) when it stays in its technical oriented wheelhouse.
  - dragonwriter 9y ago
    > Just because you can flag isn't carte blanche to post anything Just because you have certain preferences isn't carte blanche to launch off-topic diatribes in threads on articles that don't adhere to them about how you prefer HN should be focussed. > I like the site much better (and I'm sure many others too) when it stays in its technical oriented wheelhouse. That is neither the official focus [0] nor, evidently—from what the community submits and keeps on the front page—the consensus of the community. [0] From the guidelines: “On-Topic: Anything that good hackers would find interesting. That includes more than hacking and startups. If you had to reduce it to a sentence, the answer might be: anything that gratifies one's intellectual curiosity.” Obviously, whether any particular article meets they standard is subjective, which is why we have upvotes and flags and algorithms taking them and other factors (e.g., the flamewsr detector) into account.

Swizec 9y ago

My favorite quote on the topic comes from Arnold Schwarzenegger, arguably one of the most self-made people you can find. He said: "I am not a self-made man. Every time I give a speech at a business conference, or speak to college students, or do a Reddit AMA, someone says it. “Governor/Governator/Arnold/Arnie/Schwarzie/Schnitzel (depending on where I am), as a self-made man, what’s your blueprint for success?” They’re always shocked when I thank them for the compliment but say, “I am not a self-made man. I got a lot of help.”

okonomiyaki3000 9y ago
In Japan, we call him Shuwa-chan.
- yread 9y ago
  where do they have the best okonomiyaki? :)
  - okonomiyaki3000 9y ago
    Off topic.

hi-im-mi-ih 9y ago

I can't wait for my own success and fortune. After I've sacrificed my personal life and weekends for ten years, I'm glad that reputable, non-biased publications like the Guardian will have fed the rest of the population an ideology that places me as a undeserving oppressor, regardless of my individual characteristics or political viewpoint. That way, I'll only have to wait a year or two before I'm thrown in the White Privilege (TM) gulags, to spend the rest of my days carrying 100 lbs. bags of salt from one end of the gulag to the next. Thanks, The Guardian!

ahstilde 9y ago
I fear you're taking this article too personally. No one is discounting your personal sacrifice. You work damn hard. You stay in when others go out drinking. You've done this for a long time, and you're working towards the payout. That takes an immeasurable amount of perseverance. The Guardian is not discounting you or your efforts. The Guardian is saying: there are those with a safety net to experiment, and there are those without a safety net. When we look at the achievements of both populations, is it truly fair to compare those with such different circumstances?
- candiodari 9y ago
  It's saying more than that. It's saying that you may get nowhere unless you have the connections high up in other companies that you'll only have if you're rich to begin with. Without those, in many cases, no amount of perseverance will pay off.
dang 9y ago
Could you please not post ideological rants to HN, regardless of how wrong someone or some publication is? It makes for lousy conversation, and HN is supposed to be for good conversation. One needn't approve of The Guardian to see this. https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html
- hi-im-mi-ih 9y ago
  Sorry Dang. I'll try to not do this in the future, as it does make HN a worse place for everyone.

jim-jim-jim 9y ago

"When a man tells you he got rich through hard work, ask him 'whose?'"

HumanDrivenDev 9y ago

IME, most people want to craft a narrative that lets them feel OK about themselves without too much introspection. If their lives are good, they'll take credit for their fortune like the people in the article. If their lives are bad, they'll blame everyone but themselves. I've made a small jump in socio-economic class, and I try and keep it in perspective. I try and remember the bits of help I got a long the way. And at the same time I'm trying to let go of my resentment about people whose parents set them up with cars, tuition and house deposits - because one day I hope to be that parent.

fjsolwmv 9y ago
Why not be a better parent and citizen than that, instead if spoiling your children?
- HumanDrivenDev 9y ago
  Biology I suppose

RhysU 9y ago

Where is the line between transferring property and transferring advantage?

mrep 9y ago

> Does anyone really think that a CEO, whose pay is on average 271 times greater than that of his typical worker, works 271 times harder than his employees, who might actually be doing strenuous physical labor? I'm not against the general mindset the author is telling, but this garbage thought process needs to stop. This isn't about working harder, but smarter and you can easily provide 271 times more value through decisions that higher ups are tasked with than a bottom level individual contributor. ***Anecdotal*** The top level people at my company are making decisions daily that govern multi-million dollar investments which can be vastly beneficial or detrimental to our profitability. When working on investments that large in size, marginal improvements on decision making provide huge sums of value which somewhat justify the pay. Now, are these people self made? That's more open to debate but every C*O and SVP has been with the company for at least 10 years and most VPs also have also been here for that long/have an amazing track record. You generally don't get 10+ years of promotions providing nothing.

knightofmars 9y ago
There have been many studies surrounding CEOs.[1] A large portion of them keep showing that a bad CEO is worse than no CEO, an average CEO likely isn't actually doing anything, and a good CEO is probably just lucky. This topic has been researched and had the data poured over to the ends of the earth to find that "special CEO sauce". The reality? There is likely a tiny subset of all CEOs that are actually worth 271 times what the typical worker is making (Steve Jobs comes to mind). That subset of actual talented visionary CEOs is probably a ridiculously small number (eg 1% of CEOs in a global pool). The rest of the time it's just a good ol' boys club for the already rich. [1] an example https://hbr.org/2015/11/are-successful-ceos-just-lucky https://hbr.org/2015/11/are-successful-ceos-just-lucky

TheFullStack 9y ago

To be fair, people are not born with a built-in frame of reference. I used to think I was good at math due to hard work/dedication but I have since met people who worked far harder than me and still were not nearly as good at math. It works the same way with money and pretty much everything. Good-looking people think they are charming, naturally athletic people think they train harder, etc. It's just what it is.

deleted 9y ago

[deleted]

deleted 9y ago

[deleted]

suff 9y ago

What's with clueless authors and confirmation bias?

Balgair 9y ago

In reading the reactions to the article, it seems like most of HN is onto the game: Feign poverty. That said, whom are some people that really did 'make it' from rags to riches? What can we learn from them? I'll start: Andrew Carnegie Jack London George Soros Larry Ellison Ursula Burns Ingvar Kamprad JK Rowling Sam Walton Oprah The only thing that I can think of that all of them had in common was that they were really hard workers that got lucky. That hard work was the price of the lotto ticket. What am I missing here?