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Comment by solatic | Hacker News Reader

Implicit is the presumption that the smartest people optimize for wealth, or that the smartest people are good at optimizing for wealth. Outside of Wall Street, "smart" people - academics, doctors, lawyers, engineers, etc. - are just as likely to make bad personal finance decisions and/or to stay in labor (rather than management) positions for most of their careers (leave aside the dual-track IC/management ladder at a relatively small handful of companies). People don't bother to max out their earning potential because, after you earn enough to meet your needs, it quite frankly doesn't matter anymore compared to other means of personal fulfillment.

This is besides the point that the ranks of upper management are typically filled with people who are socially/politically smart, and not necessarily STEM-style smart; the cognitive ability of whom may or may not be adequately captured by this study.

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It also disregards the type of lottery game that is a part of wealth accumulation.

Of course, it is not all luck but to believe wealth accumulation is a type of purely deterministic meritocratic game without a giant stochastic factor is ridiculous.

That might even be the dumbest aspect of our society. Believing the powerball lottery winner is a genius for picking the numbers they picked is obviously stupid. Yet we basically have that view with everything else besides the actual lottery.

Not accounting for luck as a factor of success is one of my pet peeves.

I'm reading "So good they can't ignore you" and although I'm loving it, it's also guilty of that.

Cal Newport tells the story of a Clean Tech VC and how he got the job using a personal connection to VC. But then he dismisses it by saying that "such small breaks are relatively common".

Why is it so hard to admit that someone success is partially due to luck?

Because few people are objective enough to put aside their deep emotional attachment to the notion that their particular bit of hard work and skill meant nothing without that luck.

I’m wealthy now: very wealthy by any standard (mid 7-figure net worth). I came from humble beginnings (nearly homeless frequently as a youth with a single mom), but I am quite intelligent (PhD in physics) and I worked hard. I would have retired with the same 401k any other white collar worker would have but for the sheer luck of choosing the right company at the right time to win an IPO lottery. I wouldn’t have got hired without the work I put in: but there’s no doubt in my mind that my wealth is the product of luck more than that work. Literally billions of people worked harder than I have in that same period of time and have nothing but poverty to show for it. But to hear my engineer peers talk you’d think luck was negligible. They simply don’t want to discount their hard work and bias toward putting much more weight on it than is merited

Many people with your net worth grind it out without any windfalls, the product of consistent hard work and reasonable choices over decades. It was always a possibility. Most people don't require an IPO to achieve that. Luck can accelerate that outcome but it is not necessary in any meaningful sense.

It requires significantly greater extremes of wealth before luck plays a more frequent role. I know people well into 8-figures who were never anything more than blue-collar grinders. They worked hard and smart for decades with nothing that you could identify as being particularly lucky.

> I know people well into 8-figures who were never anything more than blue-collar grinders.

Can you elaborate? I don’t see how that’s possible unless they started work in their early 20s, have been maxing their retirement, never had an accident or have been unemployed, made incredible investment decisions, and are now 60+? Even then I dont see how it’s possible for blue collar folks. Well into 8 figures is like … at least 30 million.

This sounds like a classic "small business owner" success story. One can imagine a scenario where a person owning a landscaping, construction, vehicle repair, or similar business starts out with "can do a thing" and also is good at "get other people to do thing" and "operate / scale business without accidentally going out of business" and so they scale from doing to overseeing to organizing and eventually end up with a business that's got some substantial value.

Having been involved in small businesses, it's exhausting and often times it's simply impossible to transition from "doing" to "overseeing" (hiring people to do things is much harder than you'd imagine) and there are plenty of easy ways to accidentally blow the whole thing up. But if it works out, it can work out really well.

Assuming it is possible (it's probably not), it certainly wouldn't be possible without the luck of having been in an insanely strong market for whatever blue-collar trade (allegedly) got them there.

Start a small blue-collar business doing what you know, be good at it, and iterate. It compounds over decades through good times and bad times. Everyone I know that has built their wealth this way is insanely hardworking but they keep at it, creating value little by little. This is the "construction worker becomes general contractor" story or the equivalent in many boring blue-collar businesses.

I have a few of these in my extended family and seen how they've done it over my life. It is repeatable but I don't think many people would put in the level of work required and it is a slow, long game. Maxing retirement is easier but it also won't buy you beautiful estates on three continents. The people that do this also never really stop doing it in my experience, their work becomes a part of who they are.

It is lucky they didn’t have a calamity that affected their personal finances, particularly in blue collar where injuries are relatively common. I’ve heard it takes 7 years of no unexpected expenses to grind oneself out of poverty. That means no healthcare scares, no dependents, no victim of crime, not even a car breaking down randomly.

Yes, and for every one of those people, there's at least a child or two of theirs who again is back to the completely lucked out scenario because they were born to into a wealthy life, so in the end, it seems like luck plays more of a factor in success than hard work.

Luck, like capital, is all about compounding.

That’s not true. To start with, you have a huge leg up being born in a place where opportunities such as getting a PhD in physics (to take the GP post example) are available, or even in a place where schools that can prepare one to go to university in order to even think about such things. It also helps a lot to grow up in an environment that’s supportive of such things.

How can you “hard work” yourself into any of that?

> It requires significantly greater extremes of wealth before luck plays a more frequent role. I know people well into 8-figures who were never anything more than blue-collar grinders. They worked hard and smart for decades with nothing that you could identify as being particularly lucky.

Simply avoiding major adverse life events is also a form of luck, as are a whole host of other environmental factors.

I’d be very interested in hearing how a blue collar grinder can get to 8 figures.

Luck and/or violations of civil/criminal law (e.g. tax shenanigans, shortcutting regulations in things like contracting/plumbing/etc., and so on).

Blue collar grinds to wealth are mostly fantasy. There is a large amount of luck involved: friends/family helping build the business, market conditions, location, etc. That hard work is also required doesn't mean luck didn't play a role (and outsized at that).

> They worked hard and smart for decades with nothing that you could identify as being particularly lucky.

Being born in, or allowed passage into, a society that allowed one to do so in the first place is considerably lucky.

Added to clarify: To say "nothing that you could identify as being particularly lucky" is overlooking what Warren Buffet would call the "ovarian lottery" [0]. The average woman born into, say a rural Taliban stronghold and conservative household with many brothers and uncles is unlikely to ever have even a remote chance at being able to "work hard and smart" to become independently wealthy. So if not being born into that situation, is not considered lucky in terms of being able to create wealth, then are we only talking about luck after that fact? Just chopping off that inconvenient truth because it is so far removed from the blue-collar working class that grinds their way to a decent retirement? I come from a blue-collar working class family from the US mid-west that were heavily involved in the old union movements, and ignoring the above truths is something I was raised to believe - because "anything is possible with hard work and elbow grease". Sure, as long as you are lucky enough to be able to do so in the first place, but I guess that's not considered luck here?

[0] https://www.cnbc.com/2018/10/16/warren-buffett-says-being-a-...

> hard work

It is not about working hard. It is about working smart, i.e. working on the right things. You choose those things, it is not luck.

This is literally survivorship bias. I'm sure there were people in the same period, working on a similar problem and they didn't hit the IPO lottery.

The startup was a choice people made. The business plan was a choice. Executing the plan (or failing to execute it) was a choice. Accepting a job at a startup is a choice. Choosing to do an IPO is a choice.

No lotteries there.

The fact that they came across the start up in the first place had no element of luck? The fact that they were born with the genetics to be smart enough to contribute to it was fully within their control? The fact that they weren't killed in a car accident when they were 12 was due to their agency?

Success is mostly attributable to luck, and ignoring that is just an exercise in outsized ego & shows a sense of agency that borders on the absurd.

> The fact that they came across the start up in the first place had no element of luck?

Did they "come across" it in their mom's basement?

> The fact that they were born with the genetics to be smart enough to contribute to it was fully within their control?

You don't need to be a genius to be successful. Doing drugs and alcohol is also sure to reduce your smarts.

> The fact that they weren't killed in a car accident when they were 12 was due to their agency?

You can blame your parents for your life up until 18. After that, it's up to you.

> Success is mostly attributable to luck, and ignoring that is just an exercise in outsized ego & shows a sense of agency that borders on the absurd.

Baloney. Successful people 1) make their own luck 2) make it easy for luck to find them.

> Did they "come across" it in their mom's basement?

No, they came across it by being in the right place at the right time, supported by habits and behaviours that were mostly determined by their environment.

> You don't need to be a genius to be successful. Doing drugs and alcohol is also sure to reduce your smarts.

Some people are just not born with the brains to "make it". I know people who will never be able to contribute to a high growth field like ours who are excellent nurses, childcare workers and teachers. This, yet again, isn't decided by agency but by circumstance.

> You can blame your parents for your life up until 18. After that, it's up to you.

I'll remember that the next time a drunk driver tbones me.

> Baloney. Successful people 1) make their own luck 2) make it easy for luck to find them.

Our attitudes, talents and disposition are a sum of the actions we have taken, and experiences that have influenced us. Those actions are informed by our previous attitudes, talents and disposition. The experiences aren't in our control completely either. It's a feedback loop that we have minimal control over.

You can't honestly tell me that you'd come to the exact same conclusion that you are now if you hadn't had gone through what made you you. Just as I couldn't claim to come to my conclusion if I didn't have my experiences.

You're obviously successful mate. Just remember that even if some people can make it to your position, that doesn't mean everyone will. Most people do the best they can given the hand they're dealt, and that's okay. Enjoy your full house.

> You can't honestly tell me that you'd come to the exact same conclusion that you are now if you hadn't had gone through what made you you.

Yeah, I can. There is nothing particularly special about me or my background (lower middle class). I know lots of people with the same attitudes I have - all have survived failure and went on to success.

> I'll remember that the next time a drunk driver tbones me.

My dad told me he was once driving on a 2 lane country road, when a drunk passed him at high speed in a corvette. There was a stop light up ahead, and the drunk stopped at the light. My dad cautiously stopped about a quarter mile behind him. Good thing he did, because the drunk took off at full throttle in reverse.

More generally, there is a technique called "defensive driving", which is not merely following the traffic laws, but keeping an eye out for threats. I don't drive drunk, I don't get in a car with drunk drivers, I watch for erratic drivers and stay well clear, I wear my seat belt tight at all times (that one saved my life), and when I brake I check my rear view mirror, and have pulled off on the shoulder as the driver behind me hit the guy in front of me. I look both ways when crossing an intersection, even when I've got the green. I stay off the road on New Years Eve, and am generally on extra alert on the road after the bars close.

> It's a feedback loop that we have minimal control over.

You can change your thoughts and attitudes. They are under your control.

People aren't doing the best they can if they believe their lives are victims of chance rather than consequences of their choices.

I bet if I knew the details of your life, I could point out the choices you made that decided things for you.

> I know lots of people with the same attitudes I have - all have survived failure and went on to success.

Yes, however those attitudes aren't derived from the ether are they? They'd be informed by circumstance and background. You can "choose" to take an attitude towards something much like a rock "chooses" to fall when dropped. If your prior beliefs and experiences would have led you down the same rationalisation for that choice every time, is it actually a choice?

> re: defensive driving Defensive driving covers both how to avoid bad situations and how to recover from them IIRC. The implication there being that defensive driving is risk mitigation, not elimination. You're still relying on factors outside of your control to keep yourself safe.

> You can change your thoughts and attitudes. They are under your control.

idk man, hormones are a bitch and genetics predisposing people to addiction and suicide say otherwise. You do the best you can, but looking at every situation and stating that everything is a consequence of choice is assuming that some people's faculties aren't compromised from the start. Things like CBT can help, but not everyone is self aware enough to understand that cognitive distortions exist let alone treat them.

> People aren't doing the best they can if they believe their lives are victims of chance rather than consequences of their choices.

I'm sure you would find dozens of people per successful person with the same mindset as you described, purely due to a knowledge or talent gap. They'd see the same choice, make the wrong one where we'd make the right one and then suffer for it. Feedback loop, little control.

> I bet if I knew the details of your life, I could point out the choices you made that decided things for you.

So could I, but only because I made the bad choices based on the available information and influences in the first place. It's a feedback loop.

I mean, I eat dinner every night now so it's not like I'm not successful.

> however those attitudes aren't derived from the ether are they?

People choose their attitudes. I changed several of mine that were unhelpful.

> hormones are a bitch and genetics predisposing people to addiction and suicide say otherwise

I never said making choices was easy.

> I made the bad choices based on the available information and influences in the first place

It's always someone else's fault? The Marines have no tolerance for excuses. One takes responsibility. I'm not a Marine, but I admire them. I've had the privilege of working with some, and enjoyed their "no excuses" attitude and behavior. I'm not surprised the Marines are winners.

> it's not like I'm not successful

You also get to choose what success means for you.

> People choose their attitudes. I changed several of mine that were unhelpful.

The literal idea that people can change is one you have to learn on either reflection or outside influence. You do realise that, right? If that idea isn't in your vocabulary, it just isn't an option.

>> hormones are a bitch and genetics predisposing people to addiction and suicide say otherwise

> I never said making choices was easy.

When in that position, the most "logical" choice is usually a hit or a noose. It feels like you ignored the point about reasoning capacity being compromised in the first place due to whatever reason. Alternatively - I met a street preacher who was convinced god wanted him to do things he didn't want to (homelessness, etc..). Did he meaningfully have a choice, or does this fall under the "no excuses" doctrine too?

>> I made the bad choices based on the available information and influences in the first place

> It's always someone else's fault?

I'm not asserting fault here. I'm just talking about state diagrams.

Are you implying that people can make choices without knowing they exist? You only learn about possibilities and consequences from either external influence or experience. The mere idea of "no excuses" expects people to grow from their _previous experience_. You know, taking feedback from previous experience and having it inform future ones. Coming to reasonable conclusions based on that experience. It's a feedback loop.

> You also get to choose what success means for you.

I mean, besides my issue with the whole choose thing yeah, expectations for success moderate what you consider successful.

> Are you implying that people can make choices without knowing they exist?

Yes.

> You only learn about possibilities and consequences from either external influence or experience.

You can choose to do research.

Buying a lottery ticket is a choice.

s/hard/smart/g

You're making a distinction without difference. I literally had no idea whether the company I work for was even going to go public, much less how successful (or not) it would have been. There was no skill or intelligence involved in picking it. It was pure luck.

And yet you put yourself in a situation where luck could find you. Keep doing things like that, and you'll inevitably get lucky.

There’s very little skill or intelligence involved in that, though.

If you choose to join a company without doing any research on it, that's YOUR CHOICE, not blind luck.

A few mil is very wealthy? I thought it's what every SV code monkey has at 35.

That may be the picture HN paints. In the real world, "SV code monkey" engineers earn in the very low 6-figures, maybe eventually breaking $200k/year total compensation. Outside of FAANG, they're somewhat better compensated than elsewhere in the country. Within FAANG, most will burn out or plateau around the $250k - $350k total compensation mark. That's certainly affluent, and for the financially literate/careful enough to be "plain old wealthy" (high 6-figure/barely 7-figures after a decade or two). By comparison relatively few, even at FAANG, get to the worth I have unless they've been grinding at FAANG well into their 40s. It does happen, but it's not nearly as common as (perhaps) the picture HN paints implies.

Besides that, one must be incredibly lucky to land a FAANG job. Every applicant knows they have to do the leetcode grind and be up on their highly scalable distributed systems design knowledge. There are hundreds of thousands of wanna be FAANG engineers. To be one chosen out of any given round of hiring is sheer luck. The hard work is also required--but it's no harder than any other applicant worked.

There's a theory that admitting you have no control over you own life is too scary for most people.

Believing that your local witchdoctor/economist can predict the weather/economy is perhaps stupid. Believing in Karma might be too. But what's the alternative? Accepting you live in an uncaring universe where you have no control and terrible things could happen to good people at any time?

Much more psychologically safe to blame the victim as a way to ward off the thought that you could suffer the same fate.

https://en.m.wikipedia.org/wiki/Just-world_hypothesis

Luck is the particular details. Not luck is the broad arc of one's career. For example, you're not going to meet a parter sitting in your basement. You meet one by going out and interacting with people. The particular partner you wind up with is luck, but finding someone compatible is not.

I.e. the trick is to enable luck to find you. At some point, it becomes inevitable.

For another example, stock investing. You can't make money in stocks if you don't invest in stocks. Individual stock performance is a bit of a crap shoot. But if you're a patient investor, pick good companies, follow a sensible investment plan, the math is inevitable that you're going to make money in it.

I think a lot of people underestimate the persistence factor. A lot of getting lucky is about getting through the times when you are unlucky. If you can weather the storm, the sun comes out eventually.

People like stories of people who bet it all on black and win, though, so they think that's the model for success. Really, the way to win is just to not lose.

That's one way to put it. Another way is you're not going to get rich from stock options if you don't get a STEM job, and you won't get a STEM job without going to college and getting a STEM degree, and you're not going to college unless you stay in school and graduate.

Lots and lots of choices one made to get there.

Persistence is very important, but we also can't ignore the factors allowing for persistence. If two people fail with their startup and only one goes on to found a new one, the two-time founder is not necessarily more persistent. Maybe he has a social safety net and the other one doesn't, maybe he is only responsible for himself and the other one has a family, maybe he happens to get a loan which the other doesn't.

Treating each and every case as fully comparable based on just their outcome merely hurts those that have already been hurt.

Conversely, that safety net is often a product of preparation as much as a product of luck. Sure, kids of rich parents can come back to do startup after startup, but almost all of them fail at it precisely because they can run back to mommy and daddy for more.

For most successful people, the safety net comes in the form of saving money wisely, making the right friends who can give you some work to fill in the gap, or - like my multi-millionaire landscaper - being willing to be underemployed for a period of time while you get back on your feet. If you support a partner or a family, it can be a lot harder to keep yourself safe like this, but you might also have another income to fall back on.

I'm sorry to sound harsh, but I fully disagree. This is making the exact same mistake as the GP.

> the safety net comes in the form of saving money wisely

This FULLY ignores the many reasons that make it harder so save money exactly BECAUSE you don't have a safety net. A genius born into a bad environment with some medical preconditions might never be able to save ANY money due to needing to spend it to stay alive.

And that's not even looking at the many very expensive aspects of being poor like preventative care.

> making the right friends who can give you some work to fill in the gap

Right, except that poor neighbourhoods have fewer people able to employ you. So you're either lucky to meet the right people and have them like you (!) or you move out of your poor neighbourhood with the money you don't have.

> being willing to be underemployed for a period of time while you get back on your feet

Okay, and how will this help anyone pay their bills? Should people just say "guess it sucks I can't feed my family, but they just gotta power through, soon it will be worth it"?

---

Please don't read this as me saying that things like safety nets are 100% absolutely luck-based. But it's incredible to me just how much people are willing to look at "what they can do for themselves" without being willing to see why the same could be harder for people in different situations.

A friend of mine once described this as a "critical hit chance" (ala video games). There's not much chance of a 'critical hit' if you're just hanging around home, for example. But if you're on the road, stopping in at a random pub for dinner? There's that chance something special happens.

Sometimes it might be better to trade the option with higher average damage for one that is more volatile, because you might get lucky at just the right moment.

> Not accounting for luck as a factor of success is one of my pet peeves.

Why do you model life as a single bet where you have a 1 or 2% chance of winning? In reality you are making bets every day, each with a range of odds of succeeding and each success can produce a range of outcomes.

Look at poker, a game that has a massive "luck" component, people still consistently win.

Poker is a well studied, and more importantly, closed system where all of the variables are either known or known unknowns. We literally have bots now that can play poker better than any human.

The amount of decisions you make in a game of poker vs the amount you make in a lifetime are not even remotely comparable. And unlike life, in poker there's no risk in making bad decisions during the game while you're still learning. Worst case scenario you just start a new game until you get the hang of it. Life is not like that. There's no practice run, and when you make what turns out to be the wrong decision it can follow you around for the rest of your life.

His point is that it's extremely possible, and in fact happens every day, that you can be a talented, hard worker who put in the same amount of hard work and time that someone else did, and make all the objectively correct choices, and the difference between the levels of success you both achieve can and will be huge.

> We literally have bots now that can play poker better than any human.

This is not true but will be at some point.

> And unlike life, in poker there's no risk in making bad decisions during the game while you're still learning

You haven't met most poker players, they almost all start playing with real money before they even have a clue. What make s poker a truly terrifying game is that you can win a lot while making all the wrong decisions and get hooked for life while being a terrible player.

> Worst case scenario you just start a new game until you get the hang of it. Life is not like that. There's no practice run, and when you make what turns out to be the wrong decision it can follow you around for the rest of your life.

Yes, there are many unfortunate people that have made life altering decisions while young and the decisions follow them forever. Thankfully not all failures in life hold such dire consequences, in fact some failures seem like the end of the world but in reality the consequences are not as big as you expect (eg getting fired from your first job or failing an exam).

Let’s start with you have to grow up in an environment where you can the rules of the game, generally by watching others. If you know how to “hard work” yourself into growing up right, I’d like to know how.

> I’d like to know how

1. stay in school

2. pay attention in school

3. go to college

4. don't do drugs

5. don't do crimes

This is a solid ticket for anyone wishing to get into the middle class.

You forgot:

6. Don't have children out of wedlock

That derails a lot of people.

Also, "be born in, or be able to get to a country that has enough opportunities."

Choose to move to another country, choose to fix your own country, choose to do nothing but curse the fates.

I've been reading your replies in this thread, and I'd highly recommend you to just take a moment and reflect on what you've been suggesting to other commenters. Your replies have been ignorant at best and pure nonesense at worst. I'd elaborate but I don't have the time and energy to justify myself, so I understand if you take this with a grain of salt, but I wanted to let you know nonetheless.

You're welcome to express your opinion. I'm not interested in defeatism. It doesn't work for me, and I've never seen it work for other people.

On the other hand, I've seen plenty of people who took responsibility for their lives, and thereby improved them dramatically.

If I may assign you some homework:

1. what do you want to accomplish in life?

2. what are you going to do about it?

I know the current popular narrative in the United States is nobody ever actually accomplishes anything. It's always luck, privilege, you didn't build that, etc. I don't buy it. It's all excuses, defeatism, envy and misery. If you want to improve your life, don't buy it, either.

I was once told I was so "lucky" that I had a propensity to work hard. Geez. I laughed at the guy. (Actually, I'm very lazy. My dad said I was never afraid of hard work, I'd lie down right next to it and fall asleep.)

Here’s something that puts a wrench in your idea: disabled people exist and are often denied immigration explicitly because of their disabled status. Statistically everyone is simply not yet disabled. Some people are just disabled earlier in life than others, permanently affecting their capacity for work, immigration, or other self improvement without external assistance (such as medical intervention, without which they would die). In the disability community there’s a lot of just plain luck: how severe is your condition? How much support can your family supply? Are you in a country with a robust healthcare system? Are you able to afford medication, or are you able to dedicate the time to fight for medication, medical equipment, etc? Does your country have accessibility laws?

And before you call this defeatism: actually pushing harder than is realistic usually makes disability much worse! It’s instead important to realistically understand what’s available to you and frankly speak upon factors beyond your control. Otherwise people end up despairing and killings themselves way more, because they keep setting up expectations and blaming themselves when their circumstances prevent them from doing things they used to do before their disability.

Usually I preface comments of mine on this topic with "legally consenting adults with a reasonably sound mind and body."

Then you’re already applying luck there.

Isn't this kind of a motte and Bailey fallacy, though? You mention disabled people (a population of millions in the world) as your example of luck, but use it to justify the idea that you have to be born in a stable country with resources (arguably disadvantaging almost all of the world's population except for a billion or so).

Those are not even remotely comparable conditions.

No, they’re saying that someone who’s disabled isn’t allowed to even try and overcome the condition of being born in the “wrong” country.

Correct. You can’t just move countries when you’re disabled lol

Not to mention judging who’s “worthy” to contribute to society, along with the old racist dog whistle of “personal responsibility.”

I agree with the role of luck and yet it can't be the only explanation. After all, winning the lottery is pure luck, but buying the ticket isn't. People are taking risks (monetary, reputational, personal, opportunity, etc.) putting ourselves out there, increasing their "luck surface", so when the luck strikes they are the one that can benefit from it.

I prefer to think society doesn’t believe this because they are innocently misguided but because those with wealth and power have an incentive to push such narratives. If people think you’re rich because you’re a genius, they’re more likely to accept that you “deserve” your wealth and success and be less likely to think it should be redistributed. It’s also a useful way of downplaying all the other factors like social status, family connections, etc.

> those with wealth and power have an incentive to push such narratives

The luck narrative is often used to justify wealth redistribution.

> It also disregards the type of lottery game that is a part of wealth accumulation.

The article does not disregard this - luck and family wealth are the two factors they propose as causative.

In other words, luck and luck. That is, unless you know how to control what family you’re born into.

If you're in America, you can be a success by making the right choices. Choices like not doing drugs, for example.

Correction: if you're lucky enough to be in America.

Millions of people come to America. Just in my neighborhood there are Indian, Chinese, Korean, Vietnamese, Japanese, and Iranian first generation immigrants. I often hear Russian at the local park. The local real estate agent is first gen Romanian. A good friend is a Polish immigrant. I've run into three first gen Afghan immigrants nearby. The other two members of the D Foundation BoD are Romanian and Turkish. My mother was an immigrant. My sister married an immigrant.

They all came to America by choice.

In fact, America is a nation of immigrants. They came here to establish a country based on freedom, and took advantage of that freedom.

Any country could do what America did, if their citizens chose to.

Great. Now what about the other ~7.5 billion people out there? It's extremely elitist to say that anyone who wants to succeed should "just" get to America. Even if you wanted to claim that just touching the shores of the USA meant automatic success (and I am not suggesting you are), not everyone literally can do that.

> extremely elitist

LOL. First generation immigrants everywhere you look in the US.

> not everyone literally can do that

There is nothing special about America that every other nation could not do if their citizens wanted it. America was created by immigrants to be what they wanted it to be.

None of that is relevant. The fact is that other nations simply have not done those things that make America special, for whatever reason. Not everybody has the literal means to be able to just leave their country, and most people certainly don't have the means to improve it. You are again making pronouncements from atop your elitist throne here.

> The fact is that other nations simply have not done those things that make America special

That's right. They chose not to.

> most people certainly don't have the means to improve it

There are many, many historical examples of individuals of no means rising to strongly influence and even command a nation. There are also many examples of citizens toppling their government and replacing it.

You know, like the American Revolution, which revolted against the British that ruled the world at the time.

None of those are the least bit relevant at the individual level.

You sound like you subscribe to the "great man" theory of history. That theory is, quite frankly, bunk. No man is an island, and one, single person can't accomplish anything meaningful without the support of others.

You allude to this in another comment, but I do know who you are, and, no, you didn't build that. Everything you accomplished was built on the backs of what people who came before you did, and you got lucky to end up in such a privileged position to be able to even have some of the opportunities you had, much less take advantage of them.

Do you even remember what your argument is? Because I don't.

> Everything you accomplished was built on the backs of what people who came before you did, and you got lucky to end up in such a privileged position to be able to even have some of the opportunities you had, much less take advantage of them.

Yeah, if I'd just watched TV the whole time, the outcome would have been the same. Right?

> single person can't accomplish anything meaningful without the support of others.

Great men go out and get the support of others.

Do you think Apple would have existed without Steve Jobs? SpaceX/Tesla without Musk? The Soviet Union without Lenin? The Church of England without Henry 8? The US without Washington? Why is the US so different from the other North and South American nations? The Haber process without Haber?

Do you know about Norman Borlaug, who is credited with saving over a BILLION lives?

https://en.wikipedia.org/wiki/Norman_Borlaug

There are great men, and they have great influence over history.

Do you think Steve Jobs could have done any of the things he did 30 years prior?

Haber and Borlaug? Yeah, I know they bear a lot of responsibility for overconsumption in the world today.

Likewise for every single person you named. You couldn’t have done what you did had you been born a serf in 1375, and had you been so born, I would wager nobody would know your name even 10 years after you died.

No, sir, you didn’t build that.

> any of the things he did

I see you admit Jobs did it. Oops!

> what you did

You admit what I did, too. Oops!

> you didn’t

Too late!

Yeah but presumably averaging over many people or situations in a study like this would reduce that noise.

But that just averages to systematic error.

The same mistake has much worse consequences if you don't have wealth.

Nailed it. If you're Elon Musk, do some dumb mistake and lose 200 billion, your life barely changes. If you live on minimum wage, and loses half of it, starvation ensues for your family. The impact of losses is disproportional between rich and poor.

So you’re saying the poor have much more to gain through hard work and shouldn’t be discouraged?

They are already pretty motivated and usually do work a lot more than middle class folks.

The poor people who burn out completely and stop working end up on the street and either die pretty fast or find some more motivation to keep going even in that state.

Also, sadly what many poor people lack is not work ethic but capital, in the sense that they can't just take on a ~20-30M loan to send their kids to school and wait for them to start working and then pay it back. So instead of doing this they are forced to do very near-zero ROI things.

You have it completely reversed. Hard work for the poor most likely means they will still be poor and therefore have very little to gain from it.

This is just not true, at least in Australia (and I suspect most other first-world countries, including the US).

If anything, it's easier to go from having nothing to a comfortable, middle-class lifestyle than it is to go from middle-class to wealthy.

First-world is not most world. And even those places face welfare state dismantlement since at least the 80s.

Funnily enough, most of the people that seem to express this sentiment live in the first world and are educated.

I guess people who live in the third world and have mastered English see living proof every day of where their hard work can get them.

We certainly disagree. You do you guys.

So you’re saying the rich have much less to gain through hard work and shouldn’t be incentivized?

Isn't that a given? The idle rich as a class has been a thing for a long time. Rich people do not generally work shitty dead end jobs, as a general rule.

For some reason companies still agree to pay huge bonuses to their (already rich) executives to incentivize them working more/better.

There’s probably a lot more of a self actualization and entertainment component to it at that level.

Quite the opposite. While a $200M loss for Elon Musk might be nothing significant, a $200 loss for someone who is truly poor could be a huge setback. The poor have to play the game much more conservatively than the rich, which means they can’t make the big bets that have those huge upside outcomes.

Whether or not they should be discouraged is a very different question from what they have to gain.

Could you imagine saying this to a poor person with a straight face?

Case in point: the tech industry has generated at least as much wealth for right-place-right-time homeowners as for its elite-educated LeetCode warrior engineers.

> It also disregards the type of lottery game that is a part of wealth accumulation.

It's not a lottery game, it's a poker game (and in reality, it's much easier than poker because the economy is positive sum and poker is zero sum). If you only consider "wealthy" to be people who have made billions or hundreds of millions then it's a lottery. But someone that consistently makes decisions that maximize expected monetary gain can consistently become a "rich" person if our definition of rich is have more than $10million.

(Poker is negative sum if you are playing in a raked game)

Fun fact: The average American perceives “wealthy” as having just over $2.2million in net worth.

https://www.kiplinger.com/personal-finance/605075/are-you-ri...

This is very achievable to most HN types. Maybe not in our 30’s, but easily by retirement. Just maxing out your 401k for an entire tech career will get you there.

Interesting. 2.2 million seems to be around the top 10% in the US, and around 20x the median (Federal Reserve data from 2016). It also places one in the global top 1%.

Sounds right. Around 2.2 million, your money starts to generate more income than your labor can, unless you have an exceptionally high paying job.

So maybe people with a net worth above 2.2 million should be paying a wealth tax instead of an income tax.

Well they do have to pay taxes on dividends and capital gains, so its not like its totally tax free.

Even if they're 70 after working a lifetime?

At that age there’s the estate tax … plus you’re paying taxes on withdrawals since mist retirement savings are tax deferred. There’s also capital gains taxes that hit you I think.

That's called inflation.

Maybe by then (one's retirement) the average American will perceive "wealthy" as having $4million in net worth.

If I understand right, this is the perception right now, not in the future. Probably then it will be higher.

That sounds likely. Inflation and all that.

Would also be interesting to know if people in general even count 401k as “wealth”. I feel like it occupies a different bracket in many people’s minds.

> his is very achievable to most HN types. Maybe not in our 30’s, but easily by retirement.

Should be pretty easy to reach 2.2m for many people in 40 years, inflation corrected that's something like 500k.

No, the game is Monopoly. And those who entered the game late are out of luck.

Ah yeah, you should have told that to my immigrant parents who came here with nothing.

The game features a set of dice, so anecdotes such as this one are not impossible, it's just that you need to be extremely lucky.

No, if it was actually like monopoly there is 0 chance of succeeding once people have established themselves.

You have a finite number of bets you can make in your life, if you waste them by partying, gambling and being high on drugs then yeah, I can see how it can feel like it's impossible to succeed.

And life is a lot easier than these board games, there isn't one winner in life.

I think it's interesting that partying and drug use make 2 out of 3 slots in your list of useless bets that are sure to make you fail. Aren't there whole classes of extremely wealthy people who are known for drugs use and constant partying? The real central point here is wasting time. If your partying and drug use is using money for no return, your time is not paying off and you're heading down. But parties and drugs can absolutely be tools of social connection and creative exploration, which can be rewarded very highly depending on who your socializing with and what you create.

>Aren't there whole classes of extremely wealthy people who are known for drugs use and constant partying?

Yes, and they deplete their family's centuries-old hoards of wealth within 2 generations.

This seems unlikely to me, do you have any stats to back it up.

Also immigrants usually don't come to literak nothing. While its certainly difficult for them, usually there are cultural or religious groups that help them out or they have family that immigrated before them to help them get on their feet.

My parents came with literally nothing because the government they escaped took everything from them. Both of my grandfathers had their education but they could not practice their craft because their accreditation did not matter in the US, my father could not speak english, neither could my mother. My mother knew so little english that she couldn't even ask to go to the bathroom in her first week of school so she peed her pants.

From what I've seen, unsuccessful immigrants are the exception rather than the norm.

Your decisions and choices have an enormous impact on the arc of your life. Far more than luck.

This analysis seems to disprove your theory.

This resonates with me. Once our household income hit a tipping point of being financially comfortable and secure we started making decisions on a different set of criteria that optimized for dealing with less crap rather than maximizing income. In the last 6 months we didn't play by that criteria for one key decision and I can't wait to have that decision rewound even though it will cost us financially.

Society pays CEO/music/football stars much better than Stephen Hawking and other good researchers.

People like Stephen Hawking likely considers working as a CEO as a really boring job: just a lot of obvious decisions and tons of boring meetings. This kind of people will rather work as a badly paid researcher instead.

hawking probably made a lot of money from his books. As for research I think the fact is that 99% of research is useless and doesn’t matter in the long term. So it makes sense that it’s not rewarded that highly. Meanwhile every LeBron James entertains millions.

even that 1% of research has almost infinite value (but let's discount it, saying that as time goes on even hard scientific questions become easier thanks to ambient progress in other fields), whereas sport events are completely ephemeral and very fungible.

and, while I don't want to make assumption about your preferences, for me the value in sports is exactly that "being there in the moment" aspect. watching it through a screen? nah.

I believe that the sampling to enter the highest strata of top earners is also partly lottery. You get to a well paid engineering role by acing studies. But to transit from low-generational wealth to non-low generational wealth status requires you either to marry, found a company or be at the right position of an up and coming company. All of those are partly lottery - yes, you likely need to be of some talent to enter the lottery in the first place - but above that bar, which is tens of percents of society, chance has a quite a large effect on outcomes.

> But to transit from low-generational wealth to non-low generational wealth status requires you either to marry, found a company or be at the right position of an up and coming company.

Steve Jobs founded the biggest company in the world financed by selling his Volkswagon. Bezos started in a garage. Dell started in a dorm room.

The last time I founded a company, it cost me $30.

My intent was not to imply that founding a company is hard or expensive (just that creating a company that results in generational wealth is an unlikely proposition, if we take as the potential founder pool "those that statistically are likely to reach the swedish 60k limit").

It seems the above reads like something else - thanks for the clarification.

Plenty of Wall Streeters also make bad personal finance decisions.

the ranks of upper management are typically filled with people who are socially/politically smart

I used to think this still meant a sort of philosophical brilliance, an high minded intellectual mastery of manipulation.

I’ve started to realize it might be more of an instinctual animal cunning; they just have a sense of the right thing to do or say. The remaining question is whether they learned that sense or were born with it.

It is curious to entertain the latter; perhaps a hundred people are born with a hundred different calibrations, and only one of the hundred is born with just the right instinct.

When you say, in your first sentence, that there are implicit presumptions, who is making them? I don't think the study itself is predicated on those premises. Maybe people who find the result surprising had such presumptions built into their preconceptions.

>academics, doctors, lawyers, engineers

Another presumption, that people who hold these jobs are necessarily smart. I used to be fooled into believing it. I think many people are fooled.

In the pandemic I became astonished seeing how a lot of doctors were quick prescribing the likes of chloroquine, and other ineffective treatments, even after they were proven bogus. Really shaked my trust in the profession. Today I'm afraid of taking medical advice before I have the opinion of at least two and they agree.

> Outside of Wall Street, "smart" people - academics, doctors, lawyers, engineers, etc. - are just as likely to make bad personal finance decisions

It's true in finance, too!

Unless you define "smart" in finance as financially successful. It's implicit that you think finance is mostly skill based and not mostly luck based. There's a mountain of evidence that the vast majority of trading success can be explained by noise.

Are they really smart then? You are using a straw man fallacy by redefining who’s smart.

The study apparently used some flavor of IQ test, which already makes assumptions about what “smart” means.

And is who “really smart then”? I knew plenty of people in college who were of similar general IQ as me but chose career paths specifically to maximize income (finance, largely). And I knew plenty who were smarter than me who went into fields such as education or PT/exercise science because that’s what they wanted to do.

So it doesn’t surprise me in the least that IQ correlates with high income to a point, but beyond that point other factors (largely desire to be wealthy) play a larger role.

Maybe you're thinking of No true Scotsman?

https://en.wikipedia.org/wiki/No_true_Scotsman

Actually, thinking of it, https://en.wikipedia.org/wiki/Moving_the_goalposts is more fitting (since No true Scotsman is about redefining irrelevant criteria).

When there are no true goalposts, it's time for moving the straw Scotsman.

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