Since 2008, economically and socially, we’re also seeing the rise of the ‘deferers’ – the high-IQ kids who deferred eating the marshmallow, now grown-up, and are reaping all the fruits of prosperity in our ‘new economy’, getting richer than ever while the ‘eaters’ are on the lower echelons of society, stuck with crappy, low social status jobs and bad relationships, assuming they even have jobs.
…In follow-up studies, the researchers found that children who were able to wait longer for the preferred rewards tended to have better life outcomes, as measured by SAT scores, educational attainment, body mass index (BMI), and other life measures.
In follow-up studies, Mischel found unexpected correlations between the results of the marshmallow test and the success of the children many years later. The first follow-up study, in 1988, showed that “preschool children who delayed gratification longer in the self-imposed delay paradigm, were described more than 10 years later by their parents as adolescents who were significantly more competent.”
This is just more evidence of how little ‘free will’ we have, how from a very early age through simple experiments it’s possible to separate society’s future winners from the losers.
Beyond the experiment sample, marshmallow ‘eaters’ are analogous to people with poor impulse control and or mediocre IQs that until recently did well economically and socially due to an abundance of overpaid jobs that rewarded mediocre talent, but now in light of recent economic changes find themselves much worse-off than the ‘deferers’, with fewer opportunities in an economy where ‘average is over‘ and productivity, efficiency, merit, quantifiable results, and talent rule. From Paul Graham: Economic Inequality and The Refragmentation:
Everything has become much more efficient (both in the stock market and in corporate america) and competitive, with droves of college graduates applying for jobs that can be completed by high-school dropouts.
The 2008 recession gave employers a great excuse to thin the herd, and keep it thin long after stock prices and earnings made new highs. There were too many people being overpaid to do jobs that could otherwise be automated, outsourced, or simply eliminated.
Today the low-paying service sector dominates, as the labor force becomes bifurcated with the ‘creative class’ or ‘cognitive elite’ on one extreme everyone else on the other.
This echoes James Altucher in his best seller Choose Yourself of how companies used the 2008 financial problem as an excuse to ‘thin the herd’, ushering a new era of hyper-productivity, with S&P 500 profits & earnings growing long after the crisis subsided:
As you can see, profits are at record highs, and I predict they won’t be falling anytime soon:
This parallels the rise of the ‘gig’ and ‘temp’ economy – ‘DIY’ jobs that, unlike the overpaid salaried jobs of a decades ago, may not pay much, are more demanding, have no perks, and where DIY-entrepreneurs are directly accountable for their success or failure.
But as I discuss in Pencil Pushers, the problem with the ‘gig’ economy is that it requires top 5% skills to make a top 50% income, and by virtue of the Bell Curve most people just won’t cut it. There are other gig jobs that are less intellectually demanding – landscaping, dog walking, or making greeting cards. But even then, while a top 5% IQ is not required for these jobs, a top 5% work ethic is (because you have to get the customers yourself, promote yourself, etc), and most people don’t have that either. In the ‘old’ economy, you could get away with a ‘50%’ work ethic and a ‘50%’ talent. From a social darwinistic standpoint, these ‘eaters’ are at a major disadvantage.