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Is Wealth an Indicator of Genius?

The quick answer to that question is an unqualified “no.” The evidence for it lies in Ohio St. U. researcher, Jay Zagorsky, and his longitudinal study of 7,400 persons over an observational period of 25 years. He measured IQ against future wealth accumulation. His findings showed there was no correlation at all between the two factors (1979 to 2004). The bright, the average, and the dull were equally as likely to accumulate wealth. [1]

But isn’t that exactly what you would expect to find given that the great bulk of wealth is inherited? Some inheritors are bright, some are average, and some are as dumb as dirt. Neither the inheritance laws, nor Mother Nature, nor the pleadings of those like Donald Trump can alter the facts imposed on us by virtue of birth, and by the chance factors behind choosing your parents wisely. Put in a graphic way, when you stuff the IQ curve into the proverbial meat grinder, you get the same IQ distribution out, albeit in “ground round” format.

Just as a reminder, the Donald inherited some $30 million from his daddy, and, after nearly 47 years of his “genius” level wheeling and dealing, he has managed to compound his wealth almost exactly according to the growth pattern in the New York City real estate market over the same time period. Average hamburger meat in, average Whopper burgers out.

I won’t drag this essay out into something very boring with a lot of numbers. There are very few people—perhaps none at all—who can lay claim to being a product of the American Dream, or a genuine example of the “rags to riches” story. There are a few poor to rich tales to be found, but show me one that tops this one that is typical of the very rich:

Sam Walton, the founder of Wal-Mart, died in 1993 and left his kids $23 billion of wealth, mainly in Wal-Mart stock. His 5 siblings did nothing to create or to inherit that wealth. But today—just a short 22 years later—they are worth an estimated $140 billion. And still, they did nothing in becoming 6 times richer than dear old dad ever dreamed about. Holy karma come get me!

I don’t know if one of them ever set foot in a Wal-Mart store. If they did, it wasn’t to walk away with any of that cheap merchandise you and I might sort through there. Nope. Their wealth should have made them a lot more discerning, and that would be due to the incredible generosity of the inheritance laws and the ignorance of the American public in not knowing about them. They have been further aided and abetted in their quest for $trillionaire status by a host of tax avoidance techniques carefully imbedded in our tax laws.

Still, I would not want you to think that I am one of those 47 percenters that Mitt Romney called jealous, or whatever term he used. I am plain old fashioned mad as hell. He and his cronies want to eliminate the inheritance laws, thus greasing the skids and accelerating the pathway for inheritors to find their unjust rewards much faster and with ever more certainty.

Perhaps the sample is too small, but Romney and Trump did manage to get through Harvard Business and the Wharton School of Finance. Although money and graduation from either institution were and remain highly correlated, there is no evidence that either of them excelled in their academic studies. Still, the lack of academic achievement has not deterred either of them from elevating their own mental abilities, while downplaying their family’s money. They have also by boastful suggestions proclaimed that they are among the chosen few who deserve our adulation as well as residency in the White House. If the road to hell is paved with good intentions, what dare we now say about the road to 1600 Pennsylvania Avenue?

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[1] In OSU research archive, “You don’t have to be smart to be rich,” April 27, 2007.