Average

“Tough times create tough men. Tough men create easy times.
Easy times create weak men. Weak men create tough times.“
American proverb
“Wealth lasts only for three generations: one to make it, one to keep it, one to squander it“
Chinese proverb
“If you raise your children, you get to spoil your grandchildren.
If you spoil your children, you get to raise your grandchildren.“
Popular word of mouth

There’s no denying that, on average, each generation fares better than its predecessor.

Then why some people end up worse than their parents?
Is it a social thing?
Is it in their upbringing?
Is it the consequence of bad personal choices?

The easy way out would be to consider that legislation, material status, the culture one was born into and even the upbringing offered by the parents are nothing but circumstances. And, ultimately, it’s the individual who makes the call. And bears the consequences…
But the above mentioned individual doesn’t rise from and into a complete void… so I need to go deeper!

An equally true but somewhat more useful observation would be that we’re dealing here with something more important than mere wealth.

‘There’s no such thing! Nothing is more important than Wealth!’

Yeah, right… Individual people keep squandering the personal wealth accumulated by their forefathers, the humankind keeps going forward and you tell me personal wealth is the most important thing here…

But you do make a good point. Your insistence, obsessive even, about wealth being the crux of everything is very relevant.
Since I agree with you that wealth is important, indeed, then maybe it’s the ‘insistence’ which is causing the problem…

First of all, allow me to make a simple distinction.

There is wealth – structured opportunity, I’ll discuss this notion in another post, and there is personal wealth. Opportunity which belongs to somebody.
When an individual squanders the wealth inherited from their parents – or even that which they had managed to put together themselves, the wealth itself – the accrued opportunity – doesn’t disappear from the face of the earth. It just passes from one hand to another. Most of it, anyway. For the simple reason that most of today’s wealth is expressed in money. Which is fungible.

‘OK. So individual people squandering their inherited wealth do not represent such a big problem. The total wealth already present ‘on the face of the Earth’ remains (more or less) the same, no matter who owns it. And since new wealth is created everyday, the humankind, on aggregate, goes forward.’

That’s how things used to be. That’s how things had evolved for the last ten millennia or so. Ever since our forefathers had invented agriculture. Agriculture and money… Land and money cannot be destroyed. Buildings and almost everything else which carries value can. Be destroyed. Land and money also, actually, but it’s a lot harder to do it.

But there’s a catch here.

For wealth to do its trick – to function as an opportunity, people have to have access to it.
That’s why, for example, people do not keep their money under the mattress. When deposited in a bank, money will end up being used. The bank will lend them to somebody who needs it and that somebody will put that money to work, In no matter what shape or form. Kept under a mattress, money becomes mostly useless. At least for the time being…
And this is where ‘insistence’ – our obsessive insistence – that money is the only worthwhile goal for any respectable person becomes counterproductive.

‘Are you a communist?!?’

On the contrary, my dear Watson!

In fact, Marx had been just as infatuated with money as Milton Friedman was going to be a century later. With more or less similar results…
Friedman taught us that greed is good. Profit uber alles. That getting money trumps everything else. That getting money is not only good for the individual itself but also commendable. That everybody should make it their goal to become rich!
Marx, on the other hand – please remember that the ‘other’ hand is nothing but similar to its twin – advocated for all wealth to be stripped from its rightful owners.
See what I mean? Both Marx and Friedman had been thinking only about ownership. Who owns that wealth!

On average, we deal with the same situation.
According to Friedman – pushing his advice to the very limit, there’s no problem if someone owns all the money in the world. If it so happened, so be it.
According to Marx, nobody should own anything.
On average, the wealth corresponding to each living human in both situations would be the same.

We already know the consequences of Marx’s teachings. When all the wealth present in one country is managed by a very small number of people, the whole situation goes south. Fast. Very fast!
We also know what happens when the market is cornered. Becomes suffocated by a monopoly. The whole situation goes south. That’s why we cherish the freedom of the market!

Doesn’t make much sense?
To insist that the market must be free and simultaneously maintain that ‘greed is good’?

Yep! My point exactly…