Making Sense — Scott Galloway

On: Wealth and Happiness

Episode: 189

Date: March 2020

Background: Marketing professor, entrepreneur, author of ”The Algebra of Happiness”.

Key Subjects:

  • Mixed relationship between wealth and well-being. (see also “Making Sense — Kahneman”)
    • As wealth increases, well-being:
      • Levels out for the “experienced self”:
        • In the moment happiness.
        • Increases up to USD 75k per year, then levels out.
      • Continues to increase for the “remembered self”:
        • Retrospective (achievements, rewards, etc.).
        • Exposed to more opportunities, experiences.
        • Have the means to hire people for the stuff you don’t want to do.
      • Of course, more wealth is not always and not necessarily better.
        • Can achieve perfectly acceptable well-being with average wealth.
        • Increasing wealth creates its own (different) type of stressors.
        • Capitalism creates ever more incentives (to make, spend money).
        • Drives segmentation and separation.
  • Greatest wealth transfer in history to wealthiest generation in history.
    • Young carry the burden, old enjoy the spoils.
      • “Socialist economy for the boomers”.
      • Inflated asset prices due to low interest rate.
      • Lower corporate and wealth taxes.
      • Social Security.
    • Self-corrects through war, famine, revolution.
      • In the middle of a “soft-revolution” now.
    • Wealth-tax probably not a useful solution.
      • Violates “property principle”: taking away someone’s property.
      • Triggers capital flight.
    • More sensible options:
      • More equitable corporate taxes.
      • Capital gain taxes in line with income taxes.
      • Better government spending (infrastructure, education, technology).
      • Means-testing Social Security.
  • Dangers of Big Tech monopoly power.
    • Small businesses are forced to use it.
      • You may not like coal-fired plants, but you need electricity.
    • No new seed funding for potential competitors.
      • Doesn’t make economic sense to try and compete.
    • No competitive incentives to invest and differentiate to do the “right thing”.
      • For instance, investing in technology to remove fake news from platform.
    • Too much regulatory influence.
      • Not paying or held responsible for any externalities.

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