Meeting of the minds?

Bernanke: “If you get to choose between being rich or famous, I would vote for rich.”

On Twitter, Paul Romer responded:

Nah. Rich is over-rated. It’s too hard to turn money into satisfaction.

The links are here.  What should we infer from this dialogue?  Model this, so says I…

Addendum: Romer adds comment on Twitter…and more…and more.

Comments

Depends on temperament. Rich is always nice, but famous invites stalkers. If you're concerned about the latter, keeping a low profile is best. Some people don't care about that. Some people ride motorcycles at high speed. To each his own.

Hollywood movies have taught me that while the rich don't get stalkers, there's a constant threat of kidnapping, extortion, blackmail, etc. Plus, you have to deal with everyone you ever knew bugging you for a handout.

The correct answer here is obvious. People inevitably want what they don't have and think that (the missing thing) would "solve" their problems.

I agree. It's as if Bernanke makes his mind on margins. He is famous, the law of marginal diminishing returns on fame applies to him. Romer, on the other hand, less famous and the law does not apply to him.

Is it any easier to turn fame into satisfaction? I would not think so.

The two are in a sense exchangeable. It's pretty easy to turn wealth into fame (if you have a sufficient amount of wealth) and vice versa.

Wealth can make life easier. Fame probably makes it more difficult.

+1

I think it is easier to turn wealth into fame than the other way around. Especially if you are very rich.

My thought as well. For me, at least, it would be harder. I don't lust for riches, but I absolutely loathe the idea of fame. And if I had riches--my standard "what would I do if I won the lottery"--my thoughts turn to things that would leave me obscure, like buying a big spread of land out west and putting up no trespassing signs.

Using wealth to become famous seems more likely to succeed than using fame to acquire wealth.

I think the inequality reverses at some threshold.

Ryan,

I think you underestimate the impact of celebrity.

Look at Kim Kardashian. She's richer than most hedge fund managers.

This is boring dialogue because it has been hashed over so many times.

Unless Tyler is asking us to model the specific life histories of the people involved in this rehashing of the discussion.

What does "famous" mean to PR? He is certainly famous among his peers and for a very specific subset of the general population. But Rihanna he ain't. You do not want to be famous for the wrong reasons and with the wrong crowd. Subway Jared was famous. He is even more famous now.

As for "rich" - blahblahblah.

It sounds like a reference to a Bill Murray quote:

"I always want to say to people who want to be rich and famous: 'try being rich first'. See if that doesn't cover most of it. There's not much downside to being rich, other than paying taxes and having your relatives ask you for money. But when you become famous, you end up with a 24-hour job."

http://www.brainyquote.com/quotes/authors/b/bill_murray.html#CyU32EpgtYOwGMYX.99

other than paying taxes and having your relatives ask you for money.

Your assets are not taxed other than real property and legacies. I do not think you could find a portfolio of income taxes wherein the marginal rate exceeds 100%, so taxes are not a downside, just an irritant. The wealthy man in my circle of acquaintances will tell you that in 30-odd years he's fielded precisely 0 requests for money from his cousins, precisely 0 from the older generation, and precisely 2 from his siblings. I suspect the real downside to having money concerns its effect on the development of your children (and your own personal tastes).

There are different kinds of fame, obviously, and some are quite transient. Professional athletes, for instance, tend to reach the peak of their fame in their late 20s or early 30s at best. I'd imagine it is pretty depressing to be in your 40s and 50s with all of your greatest accomplishments in the distant past and with little hope of equalling them. Just as people don't like being much lower in status than their acquaintances or neighbors, I don't think people like spending most of their lives feeling that they are a shadow of their former selves.

Since Romer is an academic, he is probably thinking of academic or professional fame, which tends to come later in life and can be less ephemeral.

Bernanke might have been the worst kind of famous as he held one of the most power bully pulpits in the world, but was not allowed to use it.

I don't understand the appeal of fame. People think every little detail of your life is their business to shred in to. And then there's always the fake fake people trying to hang onto coat tails. Whenever I've done volunteering in politics or music, I always leave when the famous people come because I'm embarrassed for humanity at how pathetic people become when there are famous people around. I guess that means I'm not very good at networking, so I'll probably never be rich.

Kissing some powerful dude ass is just a single flavor of networking. However, bootlicking will just land you a middle manager job. Networking can a be as pleasant as talking and drinking an entire night with your colleagues and build something great together when the hangover passes. I think it's common to describe these process as vertical & horizontal networking.

Yes,vertical networking sucks, but what's the problem with horizontal networking? Are you 20 years old?

How often does one encounter the famous in any volunteer endeavour? I've met Paul Sarbanes (who makes a satisfactory impression one-on-one), John Anderson (who makes a passable impression), and Mark Green (who repels). I cannot imagine encountering prominent politicians or musicians so frequently that you'd have a general policy about what to do when they came into a room.

Volunteering at music festivals gives lots of opportunities to meet famous musicians. In fact, that's a major reason for many people to volunteer (I guess the list tops out at "could have met Bono in Timbuktu"), but I just do so for free tickets and the opportunity to chit chat with music aficionados.

In political stuff, if you want to make your effort relevant, you volunteer in districts which are hard fought over, and party leaders always use the same logic and make plenty of appearances in these tight races. Add to that by-elections (when someone leaves politics), party leaders always have the time to make appearances since there's only one or a few battles being fought at a time.

Also, in attending conferences (which you can also usually attend for free as a volunteer), there can be heavyweights like retired generals, ex or current ministers of state, premiers (Canada's equivalent to a governor), CEOs of large corporations, internationally recognized experts in subject matters, political party leaders or deputies, heads of NGOs, etc. who are routinely mobbed by bootlickers (obviously not everyone is...) every second they are off the stage. If I happen to pass by them at the cocktail stand and they are presently being mobbed though, I usually have a few lingering questions.

correction, NOT presently being mobbed ... if so, I might have a question.

I get what you mean. I was first a chronically broke student and then a freelance translator (all via the internet), so I never really had colleagues to do that with. Lots of nights out building stuff with people in lots of places, but in very vagrant ways while traveling ... never really kept touch, just enjoyed the experiences for what they were.

My basic understanding of good networking is that it's more about being aware of what you can do for someone (e.g., provide them with a contact in something they're working on, be a good sounding board for their project) than what they can do for you, then build and build the network until reciprocity kicks in on the occasion that YOU provide the service that one of THEIR contacts is looking for.

Your depiction of networking is altogether more appealing than the sort of situation I described in the original post.

Rich team here. I'm assuming this Rich vs. Famous means the "Rich" is wealthy but not a celebrity.

Bernanke was likely being ironic. In response to Romer, I would observe that fame is often more ephemeral than wealth; or as Andy Warhol predicted, "in the future, everyone will be famous for fifteen minutes". Romer may be an accomplished and respected economist, but he achieved his fame by suggesting that "mathiness" is often used by academics in order to allow academic politics to masquerade as science. More seriously, in the dialogue with Bernanke, Romer was likely alluding to one's calling, whatever it may be, finding and pursuing one's calling bringing far more satisfaction in life than wealth. Of course, one's calling could be wealth, pursuing wealth, finding wealth, and keeping wealth. In that case, Bernanke and Romer would be in agreement.

Romer was the son of Roy Romer -- Governor of Colorado -- so he was born to both some wealth and some fame. At that level, only a ridiculous amount of money would be even comparable to modest wealth and professional fame as a star young economist. The whole "mathiness" dustup is a trivial part of his fame among the elites. His work on growth plus his promotion of charter cities are where his real fame comes from and he finds it easy to convert that into good speaking fees, grants, etc. But in the end, he was working to be more successful -- in his own way -- than his already established father.

Fame? Paul Romer was past 30 when his father was elected Governor of Colorado. I'm from New York, and read the newspapers more than most. Off the top of my head, I think I could recall the name of a couple of Nelson Rockefeller's many children and a couple of Mario Cuomo's, and the occupation of two of the above (one the current Governor or New York and one a TV news presenter). We've had five other governors. Let's see, I think Elliot Spitzer had a couple of daughters he could have put through Binghamton with the money he spent on hookers....

As I said, "some wealth and fame." One doesn't have to be a household name to enjoy some fame in local circles and one doesn't need to have a billion dollars to be relatively rich. If you define wealth and fame to mean Forbes 400 or constant tv exposure, you're setting an arbitrarily high cutoff. Romer almost certainly felt his dad was locally successful, and I'm sure Romer, and possibly Bernanke would count as borderline rich today. If not the latter, only his own reticence is keeping Bernanke from monetizing his fame and influence.

What are you talking about? Public officials are not wealthy unless they started that way, were on the take while in office, or traded on inside information and influence (see Hastert, Dennis, "real estate investment", "eminent domain", and "earmarks"). They can get that way after they leave office by ... trading on connections. I cannot figure how you qualify as 'famous' if 99 voters out of 100 would not know you from a cord of wood. I was once tangentially acquainted with Adlai Stevenson's grand-daughter. No one in that town had a clue she was from that Stevenson family. It took her amiable and voluble next-door-neighbor months of girl talk to pry that wee bit of information out of her.

Of course, the trump is being both, right?

Well, those VW executives are now famous for trying to get rich by cheating. When will Germany ever learn to emulate the superior American model?

Being famous these days isn't great.

Open Twitter or Facebook and you'll immediately see all the bad things said about you.

Volcker or Greenspan didn't have to face the barrage of nasty blog posts from every conspiracy theorist or jealousb Nobel prize winner.

Sure they got criticism, but it was more through traditional media.

It's never a better time to be rich (or poor for that matter). Just about every amazing experience is within reach if you have enough money.

Rich is more comfortable, being famous is a job.

The best bet is to be rich, but nobody to know.

Where is Ray Lopez? Why is he taking so long to weigh in?

He is cutting chickens throats while fooling with his underage girlfriend.

Ben is right only because being rich is grossly overrated but being famous is actually a negative.

I think some famous people (Joe DiMaggio, Johnny Carson, John Kennedy Jr) develop strategies to minimize the extent to which they are molested in public places, some of which are quite simple. Others simply are not bothered by being accosted by strangers as long as the strangers are pleasant (Sonny Bono, Howard Cosell).

You win.

There is no counter argument to Sonny Bono.

I think Howard Cosell's strategy was to be nice to fans but an insufferable asshole to everyone he worked with.

i can imagine few things more hellish than being famous yet poor. doesn't everyone who seeks fame plan on leveraging it into wealth?

Here is the link to Matt Yglesias's comment to the discussion of NGDP targeting that is in Bernanke's book - MY believes it's the most important part of the book. http://www.vox.com/2015/10/8/9472807/ben-bernanke-ngdp-targeting Bernake reveals in his book that the Fed considered NGDP targeting back in 2011 but rejected it for political not economic reasons. According to Bernanke, he rejected it because he didn't believe that either the public or Congress would accept it as an alternative to inflation targeting - after years of applying inflation targeting to then adopt something vastly different, especially during a time of crisis, could undermine the Fed's credibility ("do these guys know what they are doing!"). Of course, NGDP targeting is Scott Sumner's proposal, and is supported by (among others) Krugman and Romer. I mention this here because I wonder what Romer thinks about Bernanke in light of this part of Bernanke's book.

I wouldn't be to surprised if you could map most of rich/famous preference to introvert/extrovert.

Neither Bernanke nor Romer are famous. Maybe 1 in 100 people know who the Fed chair is.

Are either "rich"? Bernanke complained a few years ago about being turned down for a mortgage.

So how can they pick?

Substitute "high status" for "famous" then. Bernanke can probably show up in pretty much any city anywhere in the world and will likely know enough people to get an invitation to speak or a lunch or dinner invitation with the local power-brokers. And historians and economists will likely still be talking about him after he dies.

Rich guy here. I think the amount of aggravation you get from family and friends asking for money hugely depends on how you got it.

Poor guy with poor family members who won the lottery / became a pro athlete? Guess what, you'll always be harassed for money, and will likely give it to them. They need it, are willing to ask, and there's a sense that you didn't really earn it in the first place.

Upper middle class guy who happens to make it big in tech or finance? Your parents and siblings will be proud of your accomplishment, and perhaps a touch envious, but won't ask for any of your money unless they are in dire need.

Little brother of rich guy here. Ummm...yep!

This mostly matches my experience. Although I would give a little more weight to the difference in starting SES vs. end SES of the rich person.

Seems a lot of commentators are missing the front-end of the statement: "If you get to choose between..." In other words, pick one, not both. Pick one, not turn one into both.

I can't imagine most people preferring famous-but-not-rich to rich-and-obscure. I think someone who would prefer fame is telling you something important about his/her personality, and not necessarily a good thing.

I do agree that rich is overrated, however.

The only way I would choose fame over wealth is if I were motivated to use the fame to make the world a better place. Mother Theresa comes to mind.

Folks who say "rich is overrated" have likely not spent much time being poor. "Fame is overrated" I can believe.

No, that's not it.

Being comfortably middle class is a bazillion times better than being poor. But being rich is only a little better than being comfortably middle class. Hence, being comfortable is highly underrated and being rich is overrated.

If that comfortable middle class person is a salaryman or salarywoman, I'd say he or she underestimates the risk of downward mobility. If you are rich and have your money suitably diversified, you don't have to worry about scrimping and saving for retirement, losing your job in a recession, or sucking up to the right people at work. Wealth doesn't buy non-stop awesomeness for the rest of your life but it does buy the sort of independence and security that middle class people only pretend to have.

In March of this year, there was a news story about that guy who posted an admittedly rude video on Youtube of him ranting at a Chick-fil-A employee in 2012. At the time, he was a CFO earning $200,000 a year. Now he is unemployed and living on welfare. Rich people don't have to worry about having their lives destroyed over a single mistake unless that mistake is a violent felony or an outrageously ill-advised investment.

What's your angle here? Are you suggesting that there are important benefits to being rich? If so, I already agree.

I think it's pretty unusual for a financial professional whose labor has been deemed worth that much to be unemployable over adhering to common haut bourgeois attitudes expressed with bad manners. While we're at it, for which 'welfare' program is he eligible? In New York, what he might garner would be general relief (which is quite spare and has a two-year time limit), housing vouchers (the waiting list is looooong), SNAP (which is worth about $4,000 per household per year), and...well that's about it.

False dichotomy. Plus 'poor' is as much a relative phenomenon as 'rich' is.

There are critiques of my comment that make sense. This is not one of them.

There are not too many famous people that are not rich these days. Bernanke must be pretty rich, too. So the divide seems highly artificial to me.

I've heard that neither of them are to be what they claim.

Bernanke sounds like a rapper who just isn't very assured of himself.

Get rich or... be moderately inconvenienced... trying.

Cash rules... some... things around me.

Gary Coleman was famous but not rich for most of his adult life. How'd that work out for him.

BfVntSEcfzIhbuvQyL 7422

Comments for this post are closed