Can “The Rich” Teach Us Anything About Money Philosophy?

We should all do ourselves a favor by studying an approach to money so we, too, can be monetarily wealthy.

Jun 22, 2014 at 8:33AM

I can think of two fairly recent instances in publishing that elucidate just how “the rich” or “the one percent” are different from everyone else, and we should all do ourselves a favor by studying their approach to money so we, too, can be monetarily wealthy.

Steve Siebold wrote a book, How Rich People Think, and the author was a guest of Tom Dziubek on the Consumerism Commentary Podcast a few years ago. Prior to recording the interview, the author sent a copy of the book for me to read and gather ideas for the podcast interviews. I no longer have the book; it was part of a significant collection of financial books I recently donated to a local library.

But as I remember, it was an easy read, filled with a contrasting generalizations about “rich people” and “average people.” Here’s one:

Average people think selfishness is a vice. Rich people think selfishness is a virtue.

Of course, this statement, as far as I’m able to see, is inaccurate, and that’s the most kind. Talk to your average upper-middle-class business person, and you will probably get the idea that they believe that their success is due to their self-centered focus, their drive for personal achievement, and their unwillingness to give freebies. They’re most likely to complain about welfare freeloaders and harbor misconceptions about poverty.

This starts to change once you get away from the people who like to talk about being rich, your millionaire entrepreneurs, business coaches, and people who are more focused on their personal image and brand than actually doing work, and you start looking at the actions of the historically wealthy. Selfishness still exists, certainly, but so does selflessness in many ways. Things look different when you stop listening to what the “rich” say about themselves and start reviewing what the wealthy actually do.

If How Rich People Think idolizes the attitudes of a select collection of wealthier individuals, The Rich and the Rest of Us, by Dr. Cornel West and Tavis Smiley, looks at the rich in a different light. Jay Frosting and I chatted with Tavis Smiley for another episode of the Consumerism Commentary Podcast. This book doesn’t take rich people to task, per se, but follows a “poverty tour” by the authors in which they met people living in or close to poverty in cities across the United States, during which they found average people were not nearly as philosophically poor as painted by Siebold.

Yet, it still did paint a troublesome picture of those in power, who manipulated the “average people” through marketing, advertising, and even regular television programming, into spending money with credit cards to upgrade their own lives to match the lifestyles of those they see in the media. The authors offer this warning:

Every empire, especially shortsighted societies that catered to greedy and powerful rules and dictators at the expense of the poor, eventually crumbled.

Back in the other direction, CNN is the latest media outlet to erect a monument to the wealthy class. But this time, what we see is not too bad, nor is it as self-serving or chest-thumping as Siebold’s book. Here, we left behind your “everyday millionaires,” those millionaires next door who, let’s face it, aren’t rich in today’s terms: the small business owner, the entrepreneur with a side job, the business coach who earns his living from talking about earning his living.

Instead, we look at the historically richest Americans, where the unit of measurement is today’s dollars, so all wealthy men — not surprisingly, they’re all men — are competing on the same playing field. We put aside what they might have written about being wealthy, or any speeches they may have given on the topic, or any out-of-context quotations that mention the words “money” or “wealth,” and just look at what the records show.

And CNN was quick to point out that most of these men were not perfect. Some were morally troubled, some allegedly (or definitely) broke the law. But it turns out that if we look at these twenty richest Americans of all-time as a group, there are some trends that stick out.

Most people on this list owned major businesses. Even the only one individual of twenty who inherited all his wealth was a business owner. But these weren’t proprietors of the local automobile repair shop. These weren’t the electricians who start their own businesses and stay there, like your millionaire next door. These are business owners who were involved with the highest technology of the day, whether that may be shipping, railroads, or computers. Not only that, but these were owners of businesses that innovated their technology and changed the world. William Gates III changed personal computing forever. He now changes the world through the Bill and Melinda Gates Foundation.

Marshall Field revolutionized retail shopping. Samuel Walton revolutionized it again. Henry Ford revolutionized personal transportation, and he did so by paying his employees double the competition’s rates. Russell Sage revolutionized Wall Street, and unlike the “greedy traders” we see in literature like The Wolf of Wall Street, he gave away most of his fortune.

Some people on this list owned real estate. Stephen Van Rensselaer was in a position since his birth to come into ownership of over a million acres of land in the New World, bestowing vast wealth on him as real estate in the United States proved to be a good “investment.” Land grant recipients didn’t even have to earn that wealth! But like the technologists and major land owners, he gave back to society by funding what in the 20th and 21st centuries would be public works projects.

But don’t get the idea that real estate today is the same as it was in the 17th century.

Most people on this list have changed the world. Everyone changes the world in some way. Every reader makes a difference in the lives of their families, every blogger makes a difference in the lives of their readers, every business owner makes a difference in the lives of their employees. But those who endeavor to change the world in some marketable way — and succeed — find their way to lists like this one presented by CNN.

If you want to learn something about living your life the way rich people do in order to attract wealth into your life, don’t bother with the self-help literature. Don’t look for motivational books. Skip studying the small-time entrepreneur (like myself). Rather than buying courses and attending seminars about how to get rich, start looking at the actions of those who most inspire you. Discover how to change the world like the wealthiest Americans in history, and try to remain humble like most of them, and you’re on the right track.

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4 in 5 Americans Are Ignoring Buffett's Warning

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Jun 12, 2015 at 5:01PM

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David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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