Sunday, December 2, 2012

Choices We Make

 Is your life path predestined by your socioeconomic status at birth?  Or are you more directly affected by the choices you make?

Why are some people rich and others poor?  Why do some people become Doctors, Lawyers, Investment Bankers, and others become fast-food chefs or cashiers at Wal-Mart?  Is it destiny, our personal choices, connections, a fix - or a combination of these things?

The answer is probably the latter.  To get ahead in the United States, you need some luck.   It helps to come from money, wealth, and connections, too.  But fundamentally, your personal choices make all the difference in the world.  You can come from a wealthy family, go to all the right schools, and have all the best opportunities handed to you, and still end up working at minimum-wage jobs.

How do I know this?  Well, I grew up in fairly affluent neighborhoods - Old Greenwich, Connecticut, Lake Forest, Illinois, and such.  Most of the kids I knew went to private schools.  Many came from old money.  Their parents owned vacation homes.  They were upper-middle-class or upper class families.  And their children had all the opportunities in the world - prep school, college, business connections, inheritances, etc.

And yet, many of these children-of-the-wealthy ended up on the skids - working at slacker jobs and living at a near-subsistence level.  Often, they lived on handouts from their wealthy parents.  And in fact, it was such a common occurrence, that many parents of that era became alarmed about their "boomerang" or "bounce back"children (just as many parents are equally as alarmed today).

While having "all the advantages in the world" might give you a head start on life, these advantages can be quickly negated by making poor choices.  It turns out that personal choices are far more powerful than inherent advantages, in most instances.

This is not to say that utter slackers, like George W. Bush, can't get ahead in spite of their poor life choices.  With enough money, even an utter idiot who does nothing but drink beer and snort cocaine, can end up as President of the United States.  However, to be fair, one has to note that at some time along that path, he did have to make some better choices - to give up the booze and drugs and decide to run for office.  There was at least some modicum of effort involved - and a choice to make that effort.

A lot of us make poor choices in life - perhaps most of us do.  And unfortunately, it is very easy to blame your poor choices on others - to externalize your problems.  And part and parcel of this is to criticize those of us who made better choices, were lucky, or had better options - or usually a collection of all three.  Those "rich folks" don't deserve their wealth, right?  After all, they didn't have to work very hard for it!

And in a minority of cases, such as inherited wealth, perhaps this is true.  A person who inherits $100 Million at age 21 certainly didn't do much to deserve that.  On the other hand, what that person does with the $100 Million is a matter of choices - and whether they parlay that into a Billion, or squander it all within a generation or two, is usually a matter of choices, not predestination.

And the beautiful thing about this country is that in most cases, heirs opt for the squander route - as they had no training in how to make money, only in how to spend it.  And within a generation or two, dynastic wealth is dissipated and room is made at the top for the next hungry entrepreneur.  Old money, in this country, is rarely more than a generation or two old.  Anything older than that is often old, but usually not a lot of money.

When I was a young slacker, my opinions on the matter were pretty much the same as other young slackers.  Those "rich folks" didn't deserve their wealth, I thought, since I didn't have any myself.  Doctors, Lawyers, and Bankers were all overpaid, in my opinion.  But of course, I had not chosen to go to medical school, law school, or business school.

And funny thing, it is just that - a matter of choice.  And one day, I woke up and realized I was making a lot of poor choices.  I was not getting good grades. I was not saving money.  I was living at a level of subsistence, rather than trying to get ahead.  And of course, my choices to consume drugs and alcohol, as well as who I chose to hang out with, had a lot to do with this.  And in that mindset, success and wealth were something that "other people" did.

So I took time off from work, went back to school, got good grades, and graduated.  Was it easy?  No.  Was it impossible?  Hardly.  And then I chose to go to law school.   Funny thing, it turns out they let just about anyone in, who has a halfway decent grade average, a good LSAT score, and the cash money to pay for the tuition.  It was just a matter of deciding to try.

And law school turned out not to be that hard.  But people who never bother to even try it will tell you that it is "hard" and not worth it, or that they don't want to be lawyers.  But they will grouse about how rotten it is that others are - or that they make money at it.

Of course, my legal career is hardly that of a Harvard grad.  A friend of Mark's did a similar thing - going back to law school.  But he went to Harvard, graduated in the top 10% of his class, in Law Review, and got one of those high-paying jobs at a big city law firm.  Now, he is partner in that firm, living in London, and no doubt making a quarter-million a year or more.  Probably more.

Am I jealous?  Perhaps.  But on the other hand, he made different choices that I did, and the choices he made, allowed him to pursue better opportunities.  And he did that, as a kid from rural Maine, whose parents ran a dairy farm.  It is not like he had big connections with New York law firms through his Dad or anything.  It was a matter of his choices.  More power to him.

Now granted, there are others who might reach that level of success aided more by connections than by choices.  Perhaps they get into Harvard as a "legacy" - having a parent who went there.   And perhaps they get that first job through a family connection.  But often, in the business world, keeping that job and advancing still requires a modicum of talent.  Not always, but usually.

The slacker will seize upon the undeserving who achieve success and cite that as the only model.  In their mind, anyone who succeeds in this country is along the lines of George Bush - a coddled Momma's boy who got ahead through family connections and the old school tie.  But for every one of those sorts, there are 100 who get ahead by their own merits.  It is possible to do, and in fact, happens more often than not.

Your choices are the major predictor of your success.  And yet, statisticians are willing to say just the opposite.  In the book Freakonomics (which is now a website, television show, magazine, radio programme, and a soon-to-be-opened theme park) the authors posit that your parent's economic status is the greatest predictor of your success.  And of course the Freakonomics people fail to understand the difference between correlation and causation - while railing it is others that don't.

If you come from a prosperous family, chances are, they will provide you with positive normative cues - to study hard, attend college, to get a job.  If you come from poverty, chances are, these values will not be as strongly stressed.

But ultimately, it is your personal choices that make all the difference in the world.  The spoiled rich kid who decides to do drugs and drop out (about half my friends in high school) will not advance despite all the advantages of his birthright.   And the girl raised in the ghetto who decides to eschew drugs and teenage pregnancy, can end up as a lawyer with the Navy's elite JAG corps.  And yes, I've met her - I went to law school with her.

No, these are not probabilistic outcomes, but they are predictable outcomes, once the right choices are made.   Never let someone pigeon-hole you into an ethnic or socioeconomic box - and tell you that it is OK to just give up on trying, as you won't succeed anyway.   You do have choices, at all economic levels.  Some have better and more choices than others, it is true.  And yes, that isn't "fair" but that's life.  Make the best of the choices you have.

What is sad to me - and the reason for this posting - is that so many middle-class and upper-middle-class kids negate the advantages of their birthright by making poor choices.   And this is the reason why our middle class is "shrinking".   Middle-class parents have stay-at-home 30-year-olds working slacker jobs and doing nothing with their lives - poor choices.   And drugs and alcohol are often the cause of this.

I don't realistically expect all the kids from the ghetto to suddenly become Billionaires by making better choices - although they can improve their lot in life by doing so.   What is sad, to me, is that we have lost an entire generation of middle-class people, and I am not sure it is due to external forces or tax rates or the decline of unionism.   I think it has more to do with personal choices.

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