Why Do We Assume "Rich" Also Means "Intelligent?"

It has always seemed weird to me that we inherently (and almost 100% universally) associate he or she is affluent with he or she must be smart. Some of the absolute dumbest human beings I’ve ever met are very well-off. I know a guy in real estate — and admittedly real estate is a tanking market for this particular moment — but in 2021, he essentially unlocked the door for someone on a $900,000 home, got tied in as the “buyer agent,” and made 3% despite basically opening a door and filing some paperwork. Nothing else, and he openly admits that. If my math is right, that’s $27,000 for about two-three hours of work. The best lawyers in the entire world barely make that. Now, if that’s his only sale of the year, that would be troubling. But repeat that process 10 times — less than once per month — and you brought home $270,000 that year for limited work. A lot of people working at Living Spaces would like that.

Of course, then you can easily get into the argument of “Well, why don’t people at Living Spaces go become realtors?” That’s a valid argument and one that should be entertained. The short answer is: “Well, probably don’t go become a realtor at a time when Wells Fargo is reporting 90% less mortgage originations.” But beyond that, the argument seems to imply that the Living Spaces floor rep isn’t smart or isn’t willing to work hard, and in reality neither is necessarily true. It’s hard to work the floor at big box stores; you need ample degrees of intelligence, conversation, resilience, generalized acumen, etc. Maybe they’re just lazy and they like that job and what it can provide in good months and years; they don’t want anything more than that.

Or maybe, and this is a key point we always gloss over, they don’t really have the financial means or the network to enter $900,000 real estate. Here, let me tell you another quick story.

I know a dude in commercial real estate who works with his dad. His constant narrative is that when he started, his dad didn’t give him any leads or contacts. Absolutely noble of the dad. What that story glosses over is that he had the same name as his dad (last name) and many people his dad did business with remembered him from growing up. That’s not quite a “born on third base” scenario, but it’s definitely born beyond the batter’s box. That’s how some of this all works.

The Halo Effect, Part I

We have a halo effect around making a bunch of money, because “make a bunch of money” is one of the only understandable models for “success,” in part because most of the first world is about getting your nut and very little else.

Maybe the easiest example of the last decade is Trump, right? He has achieved a decent amount: top TV show, name on buildings, supermodels, beat a political dynasty for President. Nice achievements. Would it be reasonable to argue he’s smart? Sure, he’s smart in certain ways. He understood (or his people understood) what was happening in America around changes and grievances , and he exploited that for political gain. That’s smart in a way, absolutely. But have you ever seen him talk or tweet or anything else? Linguists and whatnot have weighed in on this.

Now, if you’re a big Trump guy and you love “telling it like it is” and “owning the libs,” you will easily dismiss that video (or any similar video) as some “academic bullshit” that’s “not reality.” So I understand this won’t change minds. But in any type of conventional reality, which we all seem to want more than ever, Trump is intelligent, but in very specific ways — not universal ways.

The entire “self-made billionaire” movement, in fact, is largely about fleecing the government and public money safety nets:

Even Musk, who is definitely smart in the engineering/process way but has revealed himself to be a little bit unhinged member of the far right in the last six months, is kind of a myth:

The Problem With “Success” Definitions

A lot of this discussion is tied to our need for a new understanding of success. Money is nice, and leaving your family in a better position is nice, absolutely. But “success” should ideally be about:

• Relationships
• Role in the community
• Having purpose
• Finding meaning
• Working on stuff that matters, or at least helps your family have cool experiences
• Religion if that’s your bag
• Being nice to others
• Caring about what others are going through
• Etc, etc.

That’s “success,” at least in my woke eyes. Massive amounts of money are nice, and get rid of one major set of problems for another, but it’s not necessarily “success” per se — although many of us think of it as success, so the narrative holds.

The Halo Effect, Part II

Then we come to the generalized halo effect mentioned before. You see this in work all the time. It partially explains the Peter Principle. Some dude is good at one thing — tracking documents, selling, shipping, kissing ass, etc. — and because of that one thing, overburdened and busy-worshiping executives think “Oh, Tom must now be good at everything we do,” so they promote Tom to have 12 direct reports. Within six months, eight of the 12 are gone. They quit in a recession. Powerful statement, and showcasing that Tom is a terrible manager and probably an asshole. But the executives cannot see that, because Tom serves some function for them, typically getting stuff off their plate that they don’t want to deal with.

I worked for a lady at TCU who has had about 4–5 people on a team of nine quit in the last six-eight months, myself included. Her bosses like her and will never move her anywhere except up. Why? One reason I heard was that she’s good at managing remote meetings and the people above her don’t know how to let in people logging in remotely. LOL. Hey, if that increases your pay grade, more power to you.

The halo effect stuff is why we assume someone who is “rich” might also be “intelligent.” They probably have a specific type of intelligence, yes — that’s why we speak sometimes of “multiple intelligences,” although I think that theory has been cancelled by the current crop of undergraduates — but they are not conventionally that smart. Usually making money is a function of these things:

• Your personality
• Your industry
• Luck
• Your work ethic
• The overall market at the time you’re in peak earning years
• Availability of credit/capital
• Tolerance for risk
• Who you associate with / your mentors
• Your skin color
• Your gender

If you look at that list from one political angle, the first thing you will pull out is “work ethic.” Yes, that’s important. We all know Musk talks about 20-hour days and sleeping above the factory floor. Totally. Awesome. (If you have $200B dollars and sleep above a factory floor, is that a sign that capitalism is working well?) Work ethic definitely determines a lot, and I’d argue that someone who can work like a dog can beat a “conventionally intelligent” person any day of the week.

But all the other factors matter too. So making money really doesn’t have much to do with broader intelligence, writ large.

Takes?