February 15, 2012 columns

Why We Get Mad at (some kinds of) Rich People

I’m intrigued by a disconnect between the general rhetoric of anger toward the rich by folks like the Occupy movement and the actual categories of rich people they seem to be mad at. Occupy Wall Street rails against the “1%,” which would presumably include anyone and everyone rich enough to be in that top slice of earners. But there are quite a lot of very rich people Occupy spends little or no time attacking. Actors. Athletes. The late Steve Jobs. In fact, the range of the rich who draw nearly all of Occupy’s ire is decidedly narrow: bankers, non-Steve Jobs CEOs, hedge fund managers, and so on.

The Occupiers might respond that actors, athletes, and Steve Jobs aren’t harming the 99%. But neither are most bankers and CEOs. What I want to suggest instead is that part of the animosity toward the wealthy—a large part, I’m inclined to think—has nothing to do with harms or benefits caused by individual rich Americans or whether one member of the 1% is a jerk or not. No, I believe what drives much anger toward those who earn more than us results from a simple lack of understanding about just what those people did to get so rich.

I know how to throw a football, even if it’s wobbly and only sails a handful of yards. So when I watch Tom Brady hurl a perfect spiral to a wide receiver sprinting through heavy traffic at the other end of the field, I can recognize Brady’s skill and its relationship to the enormous paycheck he takes home at the end of the game. Tom Brady has a “clear job.”

Likewise with Tom Hanks, whom I can see act and can compare to other, less talented actors. I may not be able to read a script in anything other than a wooden and unconvincing cadence, but I know what good acting looks and sounds like. And I know what enjoying a movie is like, so I can, again, directly understand the connection between Tom Hanks’s skill and the millions he earns from it.

Steve Jobs’s role, too, is relatively easy to grasp. He made my iPhone. I love my iPhone and even though I know lots of other people were involved in its design and construction, Steve Jobs was the vision behind the device. So Jobs had a clear job.

But I don’t know how to run a hedge fund. I simply can’t do it—or even really understand what it is I can’t do—no matter how bad I’m willing to let the result be. Because of that, I can’t recognize hedge fund managing skill, so I can’t identify good hedge fund managers except by looking at their net worth. This means that I also can’t quite evaluate the relationship between a hedge fund manager’s skill and his enormous paycheck the way I can with Brady, Hanks, or Jobs. A hedge fund manager has an “unclear job.”

What does the “clear vs. unclear” distinction have to do with the anger of the Occupy movement? Perceived cheating. We really dislike it when someone cheats, when someone gets something he didn’t deserve, especially if he got it at the expense of someone else. Thus when we see someone making huge returns, we automatically begin looking for evidence of cheating. Unfortunately, not seeing a clear connection between the action taken (or the product produced) and the monetary benefits often counts, in our minds, as evidence of cheating. In other words, because I can’t be sure you didn’t cheat, I take that as evidence that you did.

Of course there are cheaters among investment bankers. But there are also cheaters among professional athletes. When we do discover cheating—actual cheating—we ought to get mad about it, and if it rises to the level of fraud, we ought to prosecute it. However, just as it’s not the case that most athletes and actors are cheaters, it’s also the case that most investors and CEOs are honest. The mere fact that someone manages stocks for a living no more makes him automatically corrupt than the fact that being a politician means someone is crooked.

Clearly this doesn’t explain the whole of the anger directed towards the 1%. But if it explains any of it, it means there’s a real opportunity to improve both our perceptions and our policy through simple education. If people knew more about what every sort of worker does to earn his paycheck—if we could clarify the unclear—we could begin to target our anger against those individuals who really deserve it, who really cause us harm, and who really cheat.