Not Smart Enough to Succeed: IQ Inequality = Income Inequality

From the Atlantic: Total Inequality

Total Inequality is not merely income inequality (although it matters) nor merely wealth inequality (although that matters, too). Total Inequality would refer to the sum of the financial, psychological, and cultural disadvantages that come with poverty.

It’s not that the poverty causes psychological and cultural imbalance but rather the poverty is caused by it. Although it can be difficult to disentangle genes from environment, many traits, from intelligence to psychopathy, seem to have strong hereditary component:

So how did they get that way? Is it an innate biological condition, a result of social experience, or an interaction between these factors? Longitudinal studies have shown that the personality traits associated with psychopathy are highly stable over time. Early warning signs including “callous-unemotional traits” and antisocial behaviour can be identified in childhood and are highly predictive of future psychopathy. Large-scale twin studies have shown that these traits are highly heritable – identical twins, who share 100% of their genes, are much more similar to each other in this trait than fraternal twins, who share only 50% of their genes. In one study, over 80% of the variation in the callous-unemotional trait across the population was due to genetic differences. In contrast, the effect of a shared family environment was almost nil. Psychopathy seems to be a lifelong trait, or combination of traits, which are heavily influenced by genes and hardly at all by social upbringing.

Simple tests such as ‘marshmallow experiment’ can single out children who may be doomed to underachievement later in life due to ‘high time preference’. Lows IQs, which can be measured children as young as four years old, manifest as impulsiveness, slow learning speed, inability to make inferences (poor critical thinking skills), and poor risk/reward analysis, and these characteristics, while generally harmless in the coddled environment of a school or household, come back to bite in the harsh realities of the hyper-competitive ‘real world’ when these lifelines and artificial environments are severed.

However, college, which values intellectualism, competence, and individualism (result-orientated) over social skills (collectivist), is an exception to the incubator that is primary and secondary school…The world is becoming more like college-like (or maybe graduate school) and less like kindergarten. This means fewer employees getting paid to just ‘show up’ and now more emphasis on ‘value creation’, results, and productivity. Pre-2008 we were in a ‘mediocrity bubble’, with most jobs being the equivalent of finger painting or scribbling with crayons. There’s a joke that to get job at a General Motors (or Chrysler or Ford) plant, you only need to know how to operate a remote that has three options: ‘on’, ‘off’, and ‘jam’. There are stories of employees who would ‘punch in’, quietly exit to hit the bar for the rest of the day, and return at the end of the day to ‘punch out’. Is it any surprise these companies failed and overpaid, coddled union jobs are going away, with high-IQ jobs like coding doing better than ever.

In this new, college-as-reality economy, intellectual poverty is almost the same as literal poverty, and IQ disparity is almost becoming tantamount to wealth disparity, as I discuss in Paul Graham: Economic Inequality and The Refragmentation.

If income vs IQ correlations are any clue, all too often, a poverty of IQ points often entails poverty income-wise.

As the sun sets on union and manufacturing jobs, The harsh reality is that less intelligent people are (and will continue) to be relegated to service sector or gig jobs, which may not pay well but at least create more economic value for employers.

Although entrepreneurs in blue collar industries can do very well, entrepreneurship still requires a strong work ethic, which like intelligence tends to be biological and normally distributed, meaning that a low intelligence combined with low work ethic is a recipe for failure.

How about bad upbringings or racism? Even the birth lottery does not preclude meritocracy, as shown by The Bell Curve (Herrnstein & Murray, 1994):

The Bell Curve (Herrnstein & Murray, 1994) presented general readers an
update of the evidence for the hereditarian position along with several policy
recommendations and an original analysis of 11,878 youths (including 3,022
Blacks) from the 12-year National Longitudinal Survey of Youth. It found that
most 17-year-olds with high scores on the Armed Forces Qualification Test,
regardless of ethnic background, went on to occupational success by their late 20s
and early 30s, whereas those with low scores were more inclined to welfare
dependency.

But it’s also the meritocracy within the birth lottery; the two need not be mutually exclusive, and that’s the way I reconcile the birth lottery wit the meritocracy. Look at the Silicon Valley tech culture, which epitomizes the meritocracy, but is mostly restricted to high-IQ people. Lower IQ people also have their meritocracies within their own IQ caste.

A person who has a PHD in a STEM field but is unemployed has much more earnings power than a barista, even if the latter is employed and the former is not. The PHD has the luxury of being choosy, deferring immediate income in search of a lucrative 6-figure or better job, whereas less educated people have to constantly jump from one low-paying job to another, as the turnover rates tend to be high and the advancement opportunities low. The PHD (or any high-IQ) person can more readily acquire skills that pay well; less intelligent people will find adapting to an economy of automation and ‘low-paying’ service and gig jobs to be more difficult, as good-paying skills will be cognitively out of reach.

Generations ago, in some ways, standards were higher for men (having to start a family, get a good job, get married, serve in war, etc), but also lower in other ways, particularly intellectually. The college and high school completion rates were much lower, and students had much less homework and testing. If you were relatively unskilled, you could still get a good-paying job out of high school. You have to understand, basic abilities like writing cogent sentences were coveted skills back then, whereas today you have an endless supply of freelancers who can write passable prose for little money. And this is because of mass education, which has made these medium-IQ skills more common. This means that an IQ of 140, for example, while very high, is like having an IQ of 120 a generation ago. Likewise, an IQ of 100 today, which is average, is like having an IQ of 80 a generation ago. That’s why so many authors, rejected, are forced to go to Amazon due to the over-supply of literacy in America. It’s not that education is boosting IQ scores; instead, it’s allowing more people to live to their full cognitive potential, which has the side effect of devaluing average IQ. This means that average-IQ people, in order to be competitive and make a decent living, will have to learn skills more suited for IQ >115 people, and this will prove difficult. Genius IQ is still valuable since it’s so rare, but the middle (85-115) is hurt the most due to saturation of skills that one paid well and were uncommon but no longer so.

The ‘UBI’ is a solution that often arises in these discussion, but a A UBI without preconditions (which no longer makes it ‘universal’) will just perpetuate the growing entitlement spending problem. May as well give it to people who are most likely to generate a positive ROI from the income, which is why I advocate the high-IQ basic income.