The wealthy aren't just rich — they're scared. Scared of losing face. Scared of taxes. Scared of change. In this video, I explore how the wealthy protect their status by opposing reform, hoarding money, and resisting innovation. And the cost to the rest of us? Enormous.
This is the audio version:
This is the transcript:
If you've ever met a wealthy person, and I mean, a really wealthy person, and I have as a consequence of my job as an accountant, you've met another type of person as well, and that is a worried person.
The wealthy are amongst the worst worriers I know.
You'd think that all that wealth would make people happy, and that's the myth that we are sold.
More wealth equals more happiness and the end of stress, and to a certain degree, of course, this is true. If you've got hundreds of thousands of pounds in the bank, or maybe millions in the bank, any bill that turns up is unlikely to cause you a great deal of stress, even if it was unexpected.
So those things that most people worry about, most of the time, the unexpected repair or whatever it might be, aren't a cause of concern to the wealthy.
But trust me. The wealthy are worriers, incredible worriers, and that's what we're going to look at in this video.
This is the sixth in our series on the wealthy.
So far, we've defined wealth and said, 'Who is wealthy?'.
We've made clear how they got to be wealthy, whether that be by exploitation or through a very favourable tax system. And we've said that the wealthy don't really know how much they're really worth, which is the first cause of their paranoia, but now we need to look at what else they're worried about.
And the thing that the wealthy are most worried about is losing their wealth. There is nothing that they probably worry about more than falling down the pecking order in society.
The wealthy think they're top of the pile.
They aren't sure they're worth it. In fact, they suffer very badly from impostor syndrome, which is what we suffer if we're trying to take on a role we aren't really sure that we should possess, and as a consequence, losing their wealth is their greatest paranoia of all.
The shame of having to travel economy class.
The shame of having to send their children to a state school.
The shame of just being, well, not as wealthy as they used to be in comparison to their peers.
All of that, and the fear that they might no longer command respect as a result, is the thing that worries them most of all.
These people are petrified of not being wealthy.
In fact, if anybody is jealous of the wealthy, it is curiously the wealthy, because they are so desperate to remain in their company.
They're obsessed with status and power, but they compare themselves to each other constantly, and that's why they're paranoid.
So what do they do about this? They go out of their way to defend their position as wealthy people. They fight tax changes because tax might reduce the amount of wealth they have.
They ignore the fact that, of course, it will reduce the wealth of everybody. They'll presume that it will be targeted particularly at them, and their accountant won't know the tax scheme to get around it, or whatever else.
And for the same reason, they also hate regulation and other reforms because they think these might reduce their wealth. Not that, again, the amount of money they have might fall that matters to them, so much as the fact that they might, particularly and personally, see their wealth decline and their status would fall apart, and for that reason, they absolutely obsess about these things because they want to be seen to be wealthy and to maintain their privilege.
So they use their money to protect that privilege, and that's why they fight governments. And this matters. There is a real cost to their behaviour, not only in the undermining of regulation and everything else that goes on, and the methods that they use to fight fair taxation and all of that, but there's also a cost to something else, and that is the cost of their hoarding, because remember, they hoard money. That's how and why they're wealthy. If they didn't have hoarded money and value, then of course they couldn't be considered to be wealthy, but as I've explained in other videos, most of saved money is dead money.
This isn't money that's in use in the economy. This is money that's taken out of use in the economy to protect their status, and that's all it's there for.
And they do this sometimes by buying status symbols. For example, they buy very old houses, but that usually involves putting their funds aside in secondhand assets. And that's also true when it comes to their investment profile. They will usually invest in incredibly safe companies because they don't want to lose, and so they'll go for stability.
But there's another cost as well. They will hide money offshore, for example, and that money really is not used in circulation, and they mistrust innovation and uncertainty, so they do almost nothing to grow the economy. That's the price of their obsession with status.
But more than that, they want to do something else as well. They want to maintain the divisions in society that protect their status as they see it. So, they are actually opposing the advance of anybody else in society. The people they hate, most of all, are new money.
The story that there's a division between old money, that is inherited wealth, and those who've had it for generation after generation after generation, and new money, is entirely justified.
New money - that which has been made relatively recently, maybe out of banking, maybe out of tech, whatever it might be - old money hates new money because it's brash and it's a threat to them. And all of this creates stress in our society.
The consequence is that people with wealth destroy progress. They maintain inequality. They prevent change, unless it suits them, and they create structures that support their wealth, but not wealth creation, because actually wealth creation threatens them. And all of that's because they're worried about status, preserving it, and the threat to it, and that's really challenging.
So, what are the consequences?
Wealth is saved unproductively.
We still have a divided society in the UK and England in particular, most of all.
And we have lost opportunity for many because money that is put aside by the wealthy isn't used for real investment, and as a consequence, our economies massively underperform.
We have a lack of growth, we have a lack of productivity. We just don't achieve our potential.
And all of that because the wealthy want things to stay as they are and blow the rest of us.
This is something we really can't afford, and it's all because wealth breeds anxiety, stress, division, even paranoia, but most definitely not peace or security.
Previous videos in this series:
The Wealth Series introduction: Do we need the wealthy?
Wealth Series 1: What is wealth?
Wealth Series 2: Who are the wealthy?
Wealth Series 3: Why are the wealthy so wealthy?
Wealth Series 4: Why are the very wealthy so very wealthy?
Wealth Series 5: What are the wealthy worth?
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Greed has burned a hole in their heart that will never be filled. They will never have enough.
We should pity them.
Alain de Button’s ‘Status Anxiety’ and Oliver James’ ‘Affluenza’ spring to mind.
Indeed. I have read both.
When I was a child our family used to rent a house on a farm in Wales each summer.
The farmer had bought it after he left the Army at the end of WW2
One day – this was in the mid 70’s when taxes were much higher the man he had bought the farm with who by now was in his 70’s paid a visit with his much younger wife and their new baby.
The farmers comment was along the line of the fact that while he made very little from the farm bis former business partner had made a lot but was constantly on the move trying to stay one step ahead of the taxman and that it was no way to live.
OK, the farmer was pretty ‘wealthy’ even if the income the farm produced wasnt that good but he had the life he had wanted since he had been a farmers boy in his early teens.
Quite so…
Pleonexia (Ancient Greece)…………….Dragon Sickness (Tolkien) ………………money is a drug to some people, apparently stimulating the same part of the brain as cocaine I think. It makes you ill for sure, and less human, more like a god of some sort I imagine, and at a time of hyper-individualisation it’s a recipe for disaster.
The wealth series index – weally gweat idea! 😉
Today’s edition would also make a great sermon at a midweek service in one of the City’s Nash churches.
🙂
If I understand correctly, the savings the rich own is part of the Government Debt. Of course all saving including pensions are also included.
If this was understood the dreaded black hole of the government debt would disappear in a puff of smoke.
Not all savings are public debt.
You are overstating your case.
“Not all savings are public debt”
sorry Richard that contradicts my understanding of MMT. If you have time I’d really appreciate clarification.
How are shares or bank balances part of public debt?
They are not. I am offering a simple observation of fact.
MMT does not alter reality.
I’m not sure it helps to caricature a varied group of people like “the wealthy” who share just one characteristic, ie financial wealth.
They can be worried about financial matters of course. Just as “the poor” or “the middle class”. But each group is heterogeneous and includes all sorts of people with different hopes and dreams and fears and worries. Being wealthy does not stop you having the usual range of family, emotional or health worries. But it does mean you have the resources to make the situation more comfortable.
And you have the paranoia about losing wealth
And that is so little understood it is definitely worth pointing
I have just had an interesting conversation with an ex-colleague of mine (we are both retired now). He was very upset about your recent posts about the wealthy. He accused you of being offensive (well he was certainly offended) by the terms you use to describe them. He and his partner have acquired their wealth by a combination of hard work, life choices (eg they have no children) and some inheritance from hardworking working class parents. He objects to the suggestion that their wealth is the result of exploitation and that it is not deserved. I see his point, but was taken aback by the strength of feeling he expressed….it was almost like he thought you were challenging his good intentioned life choices and insulting his character. Do you get many challenges of this sort and if so how do you respond?
How about, I don’t believe him, and that his anger reveals his own paranoia?
Am guessing funds would have been accumulated over the working life via saving from regular income, work pension, share investments and perhaps increase in property value. Which is fair enough? I guess there’s also the arguement that those avenues are relatively under taxed which is another issue…
This might be an appropriate place to remind people of this piece by neuroscientist Dan Goyal (I recall that it’s been mentioned on this blog in the past)
Among other observations he says this:
“For those consumed with greed, they are missing out on the best bits of life. Consistently, the evidence shows they are miserable. Indeed, they are so miserable that neuroimaging studies show actual changes to the structures of their brains. They are also angry and more likely to be aggressive. Evidence shows that those with Dispositional Greed seem to oscillate between being miserable and being angry.”
https://dangoyal.substack.com/p/the-motivation-behind-the-oligarchs?r=1kxgoi&utm_campaign=post&utm_medium=web&triedRedirect=true
Thanks
I read his stuff
Excellent and spot on. I live a few miles from Glydebourne and on the few occasions that I’ve been there, I have been all too aware of that scare. Terrified that they are wearing the ‘right clothes’, that they know the right people .. and even that their marriageable children will meet the right class of partner. I come away feeling oppressed for them. And I wonder how many of them actually enjoy opera …?
I was invited once. Never again.
I pity the wealthy.
They are slaves to their possessions.
I have slept rough! now I am ‘comfortably off’
As a rough sleeper I experienced kindness and humanity from unexpected quarters.
I miss that.
Wealthy people may not have a fully conscious fear of losing their wealth.
They are driven rather by instinctive loss aversion, a common human instinct which in terms of evolutionary psychology can be explained by the recognition that downside risks are more threatening to survival than upside opportunities are beneficial – organisms that treat threats as more urgent than opportunities have a better chance to survive and reproduce.
The poor dears can’t help it, they have so much more to lose than the rest of us.
We, as empathetic fellow humans, must do all we can to mitigate their plight by encouraging the widest possible circulation of Richard’s Wealth Series together with his Taxing Wealth Report.
[…] the wealthy are worried. But, as I have explained in the wealth series, the wealthy are always paranoid about maintaining their wealth, and so there […]