‘Wealth inflation’ has led to ‘elite overproduction’

I saw this tweet, which I will copy verbatim:

Seems like a good model that every Great Man gets there through some combination of Money, Power, and Status (in the right crowd), and all 3 of these are basically impossible to get simultaneously, causing the Great Man Sadness Epidemic

Elon has Money, but is constantly angling for political power and is clearly hungry for intellectual recognition from those he considers worthy

DJT now has both Money and Power, but he really really wants status, the validation of a Nobel Prize etc

Henry Kissinger had Power and Status, but was openly envious of his richer colleagues such as Peter Peterson

Peter Thiel has Money and some Power, but is quietly insecure that the ivory tower crowd don’t respect his thoughts — to such an extent that it kind of defines him

and so forth. As such, every great man is doomed to be sad — unless they manage to find the philosopher’s stone of all 3, in which case they’re John Maynard Keynes, and can finally be happy?

An astute observation. As society becomes wealthier on a real-basis, non-monetary signifiers of status (e.g. academic credentials, thinness, social media followers, math or writing ability, being ‘ripped’) become more important or valued. Wealth alone is not good enough compared to in the ’90s: physical appearance matters more than ever too, due to the rise of social media. In the ’80s and ’90s, it was primarily women who felt compelled to adhere to high body standards (e.g as typified by fashion magazines), but post-Covid, with the surge of social media and ‘fitness influencer culture’, now men face similar pressure.

At the same time, there has been significant ‘wealth inflation’. In the ’80s and ’90s, a Rolex signified uncommon, enviable wealth, but now you need something like Patek Philippe or an Audemar Piguet to stand out. Another example is seen in automobiles. In the ’90s, the car market largely operated on a two-tier hierarchy: true luxury brands like Mercedes-Benz at the top, and everything else (e.g. the standard midsize sedan, minivan, small pickup truck, or hatchback). Since the post-Covid surge in wealth and spending, that divide has blurred. Expensive vehicles such as lifted trucks, large SUVs, and Teslas–often priced on par with traditional luxury cars–have become far more common, making high-priced automobiles feel less exclusive and more mainstream.

Because America has become so wealthy in recent years, one must pursue non-remunerative routes to stand out, as wealth alone will no longer suffice. Hence ‘elite overproduction’. As Rob K. Henderson notes in his excellent post “Rage of the Falling Elite, “Al-Gharbi notes that many young, college-educated people would prefer ‘to be a freelance writer or a part-time contingent faculty member rather than work as a manager at a Cheesecake Factory.'”

As I argue in “‘Thought leader’ is just another form of elite status,” it’s not enough to have a lot of money, a legacy as one of the most successful industrialists ever, and making products used by millions of people. Today’s industrialists and financiers also want to be seen as having valuable and insightful opinions about society, or having some role in shaping society, beyond just making cars or founding startups.

In this sense, Noah Smith and Matt Yglesias, who are hugely successful and widely-read pundits and whose policy views are shared and are taken seriously, have the best jobs in the world, as even billionaires want their jobs, but it’s not like pundits aspire to be billionaires. Everyone wants the pundit job. There is no billionaire who is comparable to the likes of Noah Smith, Freddie Deboer, Scott Alexander, or Matt Yglesias when it comes to writing ability or punditry, in agreement with my assessment about the extreme rarity of this skill, in my 2024 post “Talent is a Scarcer Resource than Wealth.”

Jim Simons’s and Musk’s success owes more to timing, connections, and coordinated teamwork than to purely individual skill. Writing, by contrast, is largely a solitary pursuit, where talent shows up more directly in the finished product and can be judged on its own. Business is inherently collaborative. Jim Simons, brilliant as he was, depended on a team of equally sharp math researchers. The same is true of Elon Musk, who relies on a huge team of engineers.

Elon Musk has tried his hand at punditry by tweeting, but it always comes off as crude and is dismissed by Serious People, compared to professional-level social criticism. As Scott Alexander notes in his post about the legacy of the late Scott Adams, “The Dilbert Afterlife“:

One, the world’s greatest comic writer, who more than anything else wanted to succeed in business. The other, the world’s greatest businessman, who more than anything else wanted people to think that he’s funny. Scott Adams couldn’t stop frittering his talent and fortune on doomed attempts to be taken seriously

Scott Adams was clearly successful terms of readership. But his ideas were never taken that seriously by Important People, so in that sense he failed, as Scott notes. Having lot of readers and social media followers, as he and Elon Musk clearly have, is no substitute for recognition or validation by Important People.

Overall, I think many tech billionaires, especially Peter Thiel, Marc Andreessen, or Alex Karp want the permanence that comes with the ownership of ideas and other intellectual accomplishments–than only ownership of wealth, companies, or material goods–which are fleeting or collaborative–compared to an intellectual legacy, which outlives its originator. With business success, it’s always in the context of some sort of broader economic environment or teamwork, compared to owning or conceiving an idea or founding a movement.