I know I just finished quoting this Chris Ballas article,i but it was buried in a footnote and now bears examination in the full light of day :
The target demoii is not the 1%; the target demo is the Aspirational 14%. They know they are supposed to like quality and goodness and etiquette and discretion, but no one ever taught them what those things look like, so when someone does point it out to them they will go all in. Hence: anything in Trading Up. And they don’t care about the next generation. Not really. They don’t want them to be eaten by zombies but anything past 2069 is of no consequence. What they do care about is how a product brands them, what it says about them now, now that time is running out. Can’t afford to be subtle, which is the same thing as saying I’m willing to pay $10000 to get the message across. There’s a difference between what the brand is and what the brand says about you. You’ll pay 10x for the former and 100x for the latter.
To put the quote above in its proper perspective, the average net worth of an Americaniii in the top 1% is ~$20 mn and the entry point is ~$5 mn,iv whereas the top 1% of salaries are those over ~$400k. Recognising that salaries are easily frittered away on fine dining, exotic vacations, leased luxury cars, and low-interest mortgages, let’s focus on the “net worth” for now, keeping in mind that this twenty million bucks is an average of a steeply sloping power law distribution and therefore isn’t particularly representative.
That being said, the thing about Ballas, for all his scything insights, scathing rebukes, and scotchy breath, is that he’s not a particularly wealthy man – in fact, he’s firmly in the middle class, if perhaps as high as the 85th percentile and therefore at the threshold between the top 15% he aims to describe here and the indifferentiable masses beneath him, and has apparently never been otherwise. As such, as is necessarily the case in all such upward-looking exercises,v despite a “first-class education” and a very healthy degree of inborn skepticism, Ballas sees anyone who’s wealthier than him as “rich people” generically, and can only scarcely make out the edges of the gradations,vi Unfortunately, this perspective lacks a considerable degree of nuance and discernment,vii much like the worm can’t tell one bird of prey from another and has no way of accounting for the contradistinctions between a golden eagle and a peregrine falcon. From such an unenviableviii patch of terra firma, how could he ?
In praxis, this translates into some holes in Ballas’ endlessly entertaining, thoroughly thought-provoking (and in-channel gavaging) theories about the depths of the actual 1% and the sorta-close-behind aspirational set nipping at their heelsix not from the 14% below them, who are contented as they are, but from within the 1%. Where Ballas goes completely off the rails and ends up failing so spectacularly is, tragically, right at the very beginning with his assumption about what an “expensive” watch costs, namely, what a Patek Philippe costs : no, it’s not $10`000 for the Chronograph in those ads… it’s $200`000. Hmm. Off by a bit, wouldn’t you say ?x
With this discrepancy between real and perceived costs in mind, let’s look at another quote from the same piece :
In these adsxi the legacy is quite different: not wealth, or the business, or dynasty, but the hopefully enduring commodities approved for use by women: beauty, art, joy. It’s mom and daughter and love, packaged in refined ostentationism, which is defined as subtle quality visible from 1000 yards. Not pictured is Dad, because he’s at work or one of those parties in Eyes Wide Shut.
A Financial Times reporter incorrectly interpreted this as an expansion of the campaign to target women. This is where my training in neurology is helpful: precisely where in the brain did the stroke have to occur to cause that kind of deficit in logic? Expansion? In 2009? That makes no sense: expensive jewelery, like a car, is almost always purchased by or with the husband. The wives of the Aspirational 14%, even if they have good jobs, do not roll into a jewelry store by themselves and buy $10000 watches, unless they are the 0.5% or it is a present for their man.
What sort of nonsense is this ?! Well-heeled professional women buy themselves things all the goddam time ! This is a “progressive” society after all, is it not ? Seriously, last I checked,xii women were outright purchasers of 60+% of all big ticket items and key decision makers in 90+%. Is this state of affairs different for the 1% ? Not in terms of the purchase process.xiii Is it different for the 14% ? Not a chance. A priori presumptions to the contrary might feel internally coherent, but this observational blindness is a sandy foundation on which to build an intellectually rigorous worldview, even though it does make for a compelling story.
The newsflash is this : the 14% can afford $10k watches, but this only lands them in Tag Heuer Monaco territory,xiv and Tag Heuer Monaco dood doesn’t aspire to Patek Philippes. He knows his station in life and he’s perfectly content to make the most of it. At best, he might dream that his great-grandchildren will know the heights of heirloom quality timepieces, but more likely than not, he’d be thrilled to have even a single one of his children achieve the same level of distinction that he did, namely that of professional practioner or small business owner. That’s the scary truth about the 14% : Ballas is in it. If just. And the actual 1%, which is by and large families with net worths in the $5-20 mn range,xv are the ones buying Patek Philippes, if not quite the ones buying inflation-proof art. The 14% class beneath the 1% is buying $10k watches, to be sure, but that and 5 bucks buys you coffee.
What this tells us is three-fold :
- The 1% are actually reading The Economist and slurping up its gossip with a straw. In this, they’re the same as the 14%.
- The Patek Philippe ads are for the 1% because the 1% reads The Economist and can actually afford the watches.
- The vast majority of the 1% is in fact the “aspirational” set that Ballas attempts to describe, not the 14% beneath them.
With thirty seconds of research, Ballas could’ve figured out that two hundred grand isn’t in the domain of the 14%. What he couldn’t have seen from his vantage point between the 85% and the 14%, and what I can see precisely because I’m at the threshold between the 1% and the 14%,xvi is that the 14% composing the upper-middle-class (aka. the professional class) has no other aspirations than that their children should not fall too far beneath them, which it aims to accomplish through the accumulation of post-secondary certificates because that’s what worked before and why shouldn’t it work again ? While Ballas couldn’t see this, instead constructing a narrative that attributed loinful lust to men who largely don’t have it, I can. He misattributed the aristocratic desire for power to those with the middle-upper-class desire for comfort and contentment ; I can tell you that he was mistaken, even if I, in turn, can only make out the edges of the distribution above me.
Ironically, Ballas is stuck inside the same exit-less mental maze as the readers of The Economist that he so readily decries and belittles, making him that very typical
reader subscriber of the rag, the one who does little more than look at the nice pictures and regurgitate the key points of the cover piece because, quite simply, it’s too expensive to go deeper and… golf longa, vita brevis.xvii
Indeed, Ballas is as fallible as the rest of us and as human as the best of us. It’s little wonder that he didn’t even check his priors, lest the facts get in the way of the story he wanted to tell. And oh, quelle histoire !
But what does that really tell us about inequality ? You tell me.
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- Luxury Branding The Future Leaders Of The World, November 28, 2011. [↩]
- For Patek Phillipe ads such as :
- We’re using US data here because a) there’s a shit-ton of it available and b) USians, more than anyone else, are the ones who groan and moan about inequality ad nauseum. Despite the fact that no one gives a shit about
black livesfeelings and that all the feelingstards are really accomplishing, in point of fact, is punching their own tickets for the camps. [↩]
- Granting that measuring relative stations is fundamentally an exercise in futility when using a metric for which there’s no upper bound. [↩]
- A quote from MP is indispensable on this point, that being the sheer impossibility of so much as imagining the view from atop the mountain without ever having climbed to the peak :
Powerful men behaving badly is not a matter open to the judgement of powerless men (because they are biased – by envy, and this point is not open to any sort of debate), nor to the judgement of females (because they are biased – by gender). The only who may judge the behaviour of powerful men are other powerful men and yes this will be a credential-based discussion so you don’t get to participate without a WoT presence.
And you thought that the story of Moses ascending Mount Sinai and bringing down his views from the top was little more than a factual account. Ye of little allegorical faith. [↩]
- To Ballas’ mind, anyone richer than him are some combination of materialistic, sociopathic, and in possession of magical dragon powers. [↩]
- As we already well know. [↩]
- Middle class life is desirable for those who’ve either seen too much pain and suffering in their lives and want to distance themselves from the uncomfortable triggers of their past, or for those who’ve not seen nearly enough pain and suffering in their lives and can’t imagine themselves in the position of having to kill. Basically, it’s for quitters, even if the former type was at least honourable once upon a time and is therefore immensely more worthy of our sympathy than the others. Now, I didn’t say that either was “worthy” of sympathy, just that one was more so than the other. To each his own ultimate threshold. [↩]
- Whether the latter group ever catches the carrot dangling in front of their faces… or not. [↩]
- Sure, you can pick up a Nautilus for $50k, but that’s still well outside of the realm of affordability for the 14%. Could wannabes buy a used one on eBay for $10k ? Of course, but no one buys heirlooms on eBay. We’re biologically encoded to understand WoTs better than that. [↩]
- And I actually checked! [↩]
- If you’re in the top 1%, spending 1% of that net worth on what you perceive to be an heirloom quality item, whether it ends up being one or not, is far from outlandish. Quite the opposite, in fact. Distributing 1% of your wealth, and no more, even, to the next generation, while fostering their personal development that they may use their time wisely with this modest measure of money, is entirely reasonable and actually a pretty decent bar to set. Bestowing 10% or 50% of your wealth on your children is as liable to corrupt them as not spanking them. Giving them a taste of wealth (not comfort) – as well as a bit of a financial boost, that they might more readily separate themselves from the herd – is pretty judicious in my estimation. [↩]
- Tellingly, Tag Heuer used Tiger Woods as their spokesman for the Monaco for many years, speaking directly to the middle-upper class men who tee it up 40+ times per season at their members-only course. Said target demo isn’t impoverished by any stretch of the imagination, but nor do they confuse themselves for landed gentry. They drives Lexuses for chrissake.
(And in case this reference is lost on you (you lucky dog), driving a Lexus means that you’re automatically the least interesting person to talk wherever you happen to be, regardless of whether it’s at a baseball game, a wine+cheese party, or a bar mitzvah. Why ? Because they’re “educated” in the worst possible sense of the term ; they’re Bernanke-blowing dunning-krugerists through and through. Really, garbage men are 1000x more compelling conversationalists. So if you value your sanity, the rule of thumb is DON’T TALK TO LEXUS DRIVERS. Mkay ? [↩]
- As you can well imagine, the preponderance of individuals in the 1% must necessarily be coalesced at the lower end of the spectrum to balance the statistical scales for those worth hundreds of millions and billions of dollars. For every billionaire, there are easily hundreds of men worth $10 mn. [↩]
- Bitcoin doesn’t make it easier for you to know how many people are above you in terms of wealth, being pseudonymous and all, but it does inform you as to exactly what proportion of the intellectual capacity on the planet you possess. It’s definitely a step in the right direction! [↩]
- Seriously, count the hours it takes to play even 40 rounds of golf a year. If you calculated less than 280 hours including travel time to and from the course and beers after the round, you’ve underestimated, my friend. Now multiply by 20 years and gawk in amazement at the opportunity cost.
And don’t give me this “business happens on the golf course” nonsense either. Getting out of the office, swearing, and drinking happen on the golf course. Not that this isn’t perfectly enjoyable! [↩]