The Road to Freedom (4 page)

In 1978, economists from the University of Connecticut presented a group of adults in a national sample with a list of twenty-four big-ticket consumer items, such as a car, a house, international travel, a swimming pool, and so on. The economists asked how many of these items the participants currently possessed. They also asked, “When you think of the good life—the life you'd like to have—which of the things on this list, if any, are part of the good life as far as you are personally concerned?”
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Virtually everybody said that the good life required more things than they currently possessed. Among the people between thirty and forty-four years old, the average number of items owned was 2.5. Their ideal number was 4.3.
¹¹

The same people were interviewed sixteen years later, in 1994, and were presented with the same list. Naturally, most people had more items; the former thirty- to forty-four-year-olds (now forty-five to fifty-nine-year-olds) had 3.2 items on the list. But had they reached the good life? Of course not. Their requirements had now shifted to 5.4 items.
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In other words, after sixteen years and lots of work, the good life was just as far off as it had always been. The more stuff people have, the more they want.

IF NOT MONEY
, then what do people really crave? The answer is
earned success
, the ability to create value with your life or in the lives of others. It does not come from a lottery check or an inheritance. It doesn't even mean earning a lot of money, given all the blissfully happy social entrepreneurs I've met who are basically living on ramen noodles and tap water.

To earn your success is to define and pursue your happiness as you see fit. It's the freedom to be an individual and to delineate your life's “profit” however you want. For some, this profit is measured
in money. But for many, profit is measured in making beautiful art, saving people's souls, or pulling kids out of poverty.

Earned success is what the Founders were talking about in the Declaration of Independence. Charlatans and scoundrels promise happiness. The “Ministry of Plenty” in George Orwell's
1984
promised “our new, happy life.”
¹³
Soviet propaganda called Josef Stalin—on his way to murdering tens of millions—the “Constructor of Happiness.”
¹⁴
The Founders didn't guarantee happiness. They didn't even say people have the “right to happiness.” They said they have the right to
pursue
happiness.

The Founders knew that the role of a moral government is to create the conditions of liberty and opportunity so that each of us can define success as we see fit and then work with all our might to attain it. Their visionary insight was that allowing us to
earn our success
is precisely what gives each of us the best chance at achieving real happiness.

Modern evidence shows that the Founders were absolutely correct. The General Social Survey reveals that people who say they feel “very successful” or “completely successful” in their work lives are twice as likely to say they are very happy about their lives than people who feel “somewhat successful.” And it doesn't matter if they earn more or less income; the differences persist.
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This finding shows up in survey after survey. A 2001 survey conducted by researchers at Ohio State University found that people who said they did not feel responsible for their own successes spent about 25 percent more time feeling sad than those who said they felt they
were
responsible.
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This was true whether they were materially prosperous or not.

Here's what all this means to you and me: If I make $50,000 a year and feel I have earned my own success, I'm probably going to be happier than a billionaire who inherits his wealth and
doesn't
feel he's earned his success. Let me define my own success and earn my own way, and then I'll flourish. But take away my ability or incentive to earn my success, and I'll be miserable. If I'm not actually poor, it doesn't matter how many material things I'm given. It doesn't matter how much I receive in government services. I will not be able to achieve what America's Founders said is my “unalienable right” to pursue.

MAYBE YOU AGREE
with me here; it's earned success, not money that we want, and that brings us true happiness. It shouldn't be a problem to close the budget gap by taxing people more, because taking away their money won't take away their happiness, right?

Not so fast, Taxman. While it is earned success that really matters, people are nevertheless wired to “keep score.” Take away the scoreboard, and they don't play hard (or enjoy the game). This is true in all areas of life. I like to watch professional football because it is interesting and fun, not just to see my beloved Seahawks win. But if they took away the scoreboard and I didn't know who won, I would probably lose interest.

Just for fun, find a Marxist college professor—who scoffs at the idea that people work less if they lose the incentive of money—how he would feel if his name were not put on any of the academic articles he published. Instead the articles would be published under the name of another academic who needed the recognition more than he did. After all, he would still have the satisfaction of having written the articles. Why shouldn't that be enough? His completely reasonable response would be that he
earned
the right to have his name on those articles, and denying him that measure of earned success is viciously unfair. Exactly.

Joseph Schumpeter, often called the godfather of modern entrepreneurship, said of entrepreneurs, “The financial result is a secondary consideration.” It is, however, “an index of success and . . . a symptom of victory.”
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Money is the index of success—an imperfect one at that—not success itself. Nonetheless, people still need that index.

Of late, many entrepreneurs have spoken eloquently on this issue. Take BET (Black Entertainment Television) founder Robert Johnson, for example. In reaction to President Obama's calls to raise taxes on “millionaires and billionaires,” Johnson said,

I grew up in a family of 10 kids, first one to go to college, and I've earned my success. I've earned my right to fly private if I choose to do so. And by attacking me it is not going to convince me that I should take a bigger hit because I happen to be wealthy. . . . It doesn't mean that I am a bad guy. . . . I went into business to create jobs and opportunity, create opportunity, create value for myself and my investors. And that's what the president should be praising.
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Johnson is not a conservative. In fact, he has donated hundreds of thousands of dollars to Democratic candidates and causes. But he has discovered the key to American happiness. He wants to live in an America where hard work and success are rewarded, and the
measures
of hard work and success are protected.

Think about your own life and work—the jobs you've enjoyed and the jobs you haven't. Have you ever quit a job because, no matter how hard you worked and how clever you were, your material rewards had stalled? Consider this: 70 percent of people who say their chances for promotion are good are “very satisfied”
with their jobs, versus just 42 percent who say their chances for promotion are not good. To be happy, people need clear paths to success and the ability to measure and keep rewards.
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IT IS FAIR AND RIGHT
for people to want to keep the measures of their earned success. But it is easy to become focused
only
on money as a measure of success. This is a dangerous mistake.

People do awful things for money, including unearned money, which the evidence shows brings zero (or even negative) happiness. They fight over inheritances; they steal from others; they gamble compulsively. How can it be that even many rich people still haven't figured out that earned success—not money—is the correct object of their desires?

The short answer is that people screw up. Or, as social scientists prefer to put it, people commit an “epistemic error.” People mistake what they want for the
measure
of what they want. I want a blood pressure reading of 120/80, but that is nothing more than an indicator of the force of my blood running through my arteries; it is not heart health itself. For years, I tried to explain to my university students, who always worried a lot about their grades, that their grade point average was only a rough measure of wisdom. (Somehow this brought them no comfort.)

In economic life, earned success itself is messy and hard to define. Money is a neat and convenient measure of it, so people focus on money instead. The common word for that kind of epistemic error is
materialism
, and it leads to misery. As the Roman poet Persius said, “Oh, what void there is in things.”

Social scientists have repeatedly proven Persius right. In 2011, a group of psychologists at several American universities found that kids who were most attached to material objects were the least
grateful for the blessings in their lives, most envious of others, and enjoyed their activities outside of school least. Materialistic kids are unhappy kids.
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But materialism's curse is most brutal later in life, especially for men. One of the common findings in studies of happiness is that there is a distinct low point in men's happiness in their mid-forties. (Women don't have this dip.) Using the General Social Survey data from 2004, I have found that the happiness nadir occurs right around age forty-five for the average American male, even after correcting for income, education, race, religion, and politics.
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So what's going on at age 45—the clichéd male midlife crisis? Psychologists have explanations that revolve around marriage and family. They basically say that the problem for men at age forty-five is that wives have pretty much figured out their husbands are boring. In addition, there is probably at least one sullen teenager living at home.

But there's an economic explanation, too. When men start their careers, earned success and money track together pretty well. They get better jobs, win promotions, make more money, acquire more responsibility, and live their dreams, year by year. But the roads between money and earned success begin to diverge, so subtly that it is hard to notice at first. Men tend to follow the professional superhighway, the one with the big neon dollar signs. The road to self-realization, the pursuit of happiness, is a little path through the woods that they easily miss.

By forty-five, a lot of guys realize they took the wrong road. They recognize their epistemic error. Some can trace back their steps. Personally, I got lucky and saw fairly early that I was going the wrong way, and went back to find the little path. The trouble is that not all forty-five-year-old guys can retrace their steps (or
think they can't) and end up saying, “I
hate
my job, but I have to pay my mortgage.”

EARNED SUCCESS
has a flip side: learned helplessness. This term was coined by the social psychologist Martin Seligman at the University of Pennsylvania.
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Learned helplessness is a state in which, if rewards and punishments are not tied to merit, people simply give up and stop trying to succeed.

Seligman examined learned helplessness in experiments on both animals and humans. In one study, he found that dogs subjected to inescapable and arbitrary electric shocks had greater difficulty taking steps to escape pain from predictable sources than dogs that hadn't gotten the arbitrary shocks.
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Experience taught them that they were powerless to positively influence their circumstances. In later studies, human subjects presented with insoluble problems or exposed to inescapable unpleasant noises subsequently had greater difficulty with ordinary tasks.
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Their helplessness early on incapacitated them later.

Just as earned success brings happiness, learned helplessness brings unhappiness. As Seligman noted in an interview in the
New York Times
, “We found that even when good things occurred that weren't earned, like nickels coming out of slot machines, it did not increase people's well-being. It produced helplessness. People gave up and became passive.”
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The implications for the welfare state are too obvious to miss. If the government gives people rewards they did not earn—welfare checks, make-work jobs, or whatever—it will not improve their well-being. Even worse, it will make them helpless.

This is surely why people go to such contortions to act as if their unearned rewards from government were actually earned. In
the 1970s, it was common to refer to welfare as a “salary.” Today, the easiest way to get yourself shot at a retirement village is to suggest that senior citizens are taking more out of the Social Security system than they ever put in.

As bad as unearned rewards are, unearned punishments are even worse. That is why onerous regulation and punitive taxation are so harmful, and why it is so demoralizing for the general population to learn that we pay taxes to fund public-sector benefits and pensions that, in the case of the federal government, are 61 percent more lavish than equivalent workers receive in the private sector.
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It is also why it is so discouraging to see tax dollars bail out politically connected banks and car companies.

The message is clear: People thrive when they can earn their success, and they suffer under conditions in which they can't, or are trained not to, succeed. People flourish when they control their lives. When that is taken away from them by the state or corporate cronies, everyone suffers.