Balneus

Australian Lefty on Politics, Governance, Science and Info Management

Green-eyed monsters and golden treadmill (2)

Posted by Dave Bath on 2007-08-07


In "Green-eyed monsters on the golden treadmill" I took at a NY Times report on millionaires who feel poor and indicated Howard’s aspirationals are in a similar trap.

I’ve moved a response to Michael Sutcliffe’s comment into this separate post, continuing my argument that the Howard aspirationals are indeed on that treadmill and it’s unlikely to make them happier.

Michael, you say… "You losers. Just because you can always find someone who is dominated by greed to a fault doesn’t mean that this somehow represents ‘Howard’s aspirationals’.  The vast majority of these people love their lives, love being productive and working hard, love the way the extra material goods enhance their lives, and love the fact that wealth allows them to take holidays overseas and pursue more expensive hobbies/sports/recreations."

The folk I refer too are not necessarily out-and-out greedy (I want more), but suffering the effects of needing positional cues for their happiness, a Red Queen scenario. The aspirationals are getting caught in the same trap, although the demonstration is less stark than with the millionaires that feel povo.

I’ll refer back to the Christmas 2006 edition of The Economist, where they are critical of the treadmill as creating unhappiness, and include Adam Smith (I believe you’re a libertarian, which is why I mention Smith) to back up their arguments, and talk of people placing value on "positional" things, i.e. where they are in the pecking order. Bolding is mine.

From Happiness and Economics: Economics discovers its feelings:

Happiness, as measured by national surveys, has hardly changed over 50 years. The rich are generally happier than the poor, but rich countries do not get happier as they get richer. The Japanese are much better off now than in 1950, but the proportion who say they are “very happy” has not budged. Americans too have remained much as Alexis de Tocqueville found them in the 19th century: “So many lucky men, restless in the midst of abundance.”

To clamber up the pecking order, some people slave away nights and weekends at the office. They gain in rank at the expense of their free time. But in making that sacrifice they also hurt anyone else who shares their aspirations: they too must give up their weekends to keep up. Mr Frank reckons that many people would like to work less, if only others slackened off also. But such bargains cannot be struck unilaterally. On the contrary, people compete in costly “arms races”, knowing that if they do not work harder, they will lose their standing to someone who does.

Unfortunately, most of the Affluence (Xmas 2006) article is off line, but it too talked of the disconnect between affluence and happiness in a theoretically booming economy.

2007-07-12 saw the Where money seems to talk article, which said wealthier countries and people within countries correlated with happiness (although Cubans were pretty happy despite being p-ed off about lacking freedom, but overall happy because they had no need to worry about health and education of themselves or children if you go deeper into the polls they reference):

Ever since social scientists at the University of Pennsylvania found that mansion-dwelling American millionaires are barely happier than Masai warriors in huts, some economists have been downplaying the link between cash and contentment.

In fairness, the “new happiness” economists, such as Mr Layard, never claimed there was no connection at all between money and feeling good. What they have said is that once people climb out of poverty, the link is weak, and may not work at all above a certain point (as one British pundit put it, extra money “is now proved beyond doubt not to deliver greater happiness, nationally or individually”). The evidence for this comes from surveys in most rich countries (such as America’s general social survey), which show that happiness has been flat for decades, even though incomes have risen sharply.

In both issues, The Economist explicitly or implicitly linked the Australian (and UK) experience to the US trends, while the Nordics weren’t suffering the same neuroses.

Yes, some may criticize The Economist as becoming lefty, but it’s pretty hard to argue against their data and analyses which are driven by the highly respected EIU.

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2 Responses to “Green-eyed monsters and golden treadmill (2)”

  1. raf said

    Michael,

    I’m not saying that material success is a bad thing or that people shouldn’t want a better life. I think the original post was looking specifically at the Red Queen effect and that people could show signs of stress at their circumstances even when they were in the top 1% of the population.

    Surely there must be method in this madness, a purpose to having more material goods? If you aren’t happy with $10m, its unlikely you will be happy with $20m. It suggests the problem is internal.

    All studies of happiness (GPI, ISEW and other indices) all say the same thing. In the end, it isn’t about money. It’s how you feel that counts.

    Of course we must pass certain thresholds in our Maslowvian framework but even then there are those who would seem without material success who are quite happy.

    I think the thrust of Dave’s post is that people are continually sucked into thinking that more and more material prosperity is the answer to their dreams.

    I know happy and contented people who have very little and very unhappy people who have much.

    I am extremely grateful for the abundance i have in my life but i do not believe i would be any less happy with less. That is the lesson i have learnt and my observations having worked in a business populated by extreme wealth.

  2. The folk I refer too are not necessarily out-and-out greedy (I want more), but suffering the effects of needing positional cues for their happiness, a Red Queen scenario. The aspirationals are getting caught in the same trap, although the demonstration is less stark than with the millionaires that feel povo.

    I’d still classify all of this as greed. Greed is where you are driven by a negative and irrational emotion to have more of something than is rationally benefitting you. I’d also say a healthy dose of individualism wouldn’t go astray either, rather than trying to ‘keep up with the Jones’ you should really be looking to yourself and asking what it is that you want out of life.

    I think we agree here that the issue is overcoming the negative emotions like greed and ‘Red Queen’ syndrome. My problem is that all too often the left try to use combatting these negative emotions through really bad legislation. For example, Clive Hamilton’s argument that taxes are good because they discourage people from working and therefore spend more time with their families. This is destructive policy and really typifies the solutions we see coming from that side of the political fence.

    Also, I do actually believe in my previous post that Australian individualism is still pretty strong and with the ‘aspirationals’ you’re really just looking at a lot of people who really feel that they are building the life that they want for themselves, grateful that they have the opportunity to do this, and are largely devoid of the negative emotions described above.

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