In “The Rise of the New Global Elite,” The Atlantic’s Chrystia Freeland investigates the lives of the upper-echelon businesspersons whose work means globetrotting, hobnobbing with their income-equals and a feeling of victimization (because policy makers challenge their financial success in the name of economic crisis and the growing inequality gap). Today’s uber-wealthy are earning the old fashioned way.
In 1916, the richest 1 percent of Americans received only one-fifth of their income from paid work; in 2004, that figure had risen threefold, to 60 percent.
And overall, they’re less sympathetic to those who aren’t self-made.
For the super-elite, a sense of meritocratic achievement can inspire high self-regard, and that self-regard—especially when compounded by their isolation among like-minded peers—can lead to obliviousness and indifference to the suffering of others.
And it’s an attitude that is bearing out in research as well. Because the elites spend so much time with their socioeconomic peers, they’ve lost touch with the struggles of the Average American. When you can throw money at jet shares and homes in exotic locales, money may define your key relationships rather than community interdependency. While a group of PTA moms bond over carpool schedules and football games, the business elite are trying to out-status each other. And it shows.
A recent study published by the Association for Psychological Science found that subjects from top education or socioeconomic status levels were less able to read the emotions of people in photos or simulated interviews than those from lower education and socioeconomic tiers.
Earlier studies have suggested that those in the lower classes, unable to simply hire others, rely more on neighbors or relatives for things like a ride to work or child care. As a result, the authors propose, they have to develop more effective social skills — ones that will engender good will.
The differences do not end there. Living in the lap of luxury may actually impact the capacity for business leaders to act responsibly in the workplace. A recently released Harvard Business School paper found that:
people who were made to think about luxury prior to the decision-making task have a higher tendency to endorse self-interested decisions that might potentially harm others.
In a follow up experiment, after viewing either luxury or affordable items, subjects were asked to complete a word recognition exercise involving blended pro- and anti-social words together. While each group scored about the same on anti-social words (like “rude, stingy, and selfish”), but the group that saw luxury items before the exercise saw fewer pro-social words (nice, giving, and helpful). Researchers concluded that the respondents prepped with luxury items in each case were primarily thinking of themselves, not others.
If these studies are applied to the business world, the self-concerned may be making decisions affecting profit and personal gain with little concern for the people that could be adversely impacted by any of the options on the table. A life of luxury could be making it harder to make decisions with broader positive impact. Considering Wall Street’s fight against tighter regulations and the banking industry’s foreclosure mills, it doesn’t take much to make the leap from the research to its real world implications.
That research puts the anecdotal indifference in Freeland’s Atlantic article in a new light.
In a recent internal debate, [a hedge fund CEO] said, one of his senior colleagues had argued that the hollowing-out of the American middle class didn’t really matter. “His point was that if the transformation of the world economy lifts four people in China and India out of poverty and into the middle class, and meanwhile means one American drops out of the middle class, that’s not such a bad trade,” the CEO recalled.
Certainly, the power of luxury over social and environmental circumstance is also being tested. Last year, several dozen of America’s billionaire’s made The Giving Pledge to donate “the majority of their wealth to the philanthropic causes and charitable organizations of their choice either during their lifetime or after their death.”
The question is how to make larger community considerations the standard, not the exception?
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