Thursday, July 12, 2012


The British press is having a field day over the tragic death of billionaire Eva Rausing, who was married to the third generation heir of the man who invented the cardboard milk carton. There is a third generation curse, this Telegraph article says. Many people with too much money and too little purpose in life drift into self-destructive ennui:  

In 1944, Evelyn Waugh wrote a letter to an old friend, Coote Lygon, saying: “I am writing a very beautiful book, to bring tears, about very rich, beautiful, high-born people who live in palaces and have no troubles except what they make themselves and those are mainly the demons, sex and drink.” ..
If Waugh was writing Brideshead now, he’d throw in a third demon – drugs. Poor Eva Rausing, who was found dead this week, was the daughter of a rich American Pepsi-Cola executive who multiplied her fortune – and her troubles – a thousand times, with her marriage to Hans Kristian Rausing, joint heir to the £4.5 billion Tetra Pak fortune. It didn’t help that they met in rehab. As they don’t teach you in maths lessons in smart public schools, Predisposition Towards Drugs + Limitless Cash = Big Trouble.
There is a third element to the equation: too much playtime. It’s the drugs that actually shut down the body; but it’s the relentless dreariness of one empty day after another, with nothing to do – except the odd charity ball committee meeting and the forever unfinished screenplay – that buttresses the need for drugs.

It's very sad. It also illustrates a theme I keep coming back to: people find it hard to live and be happy without a sense of purpose. But our economic system at best delivers purpose only as a side-effect.

When people are released from economic constraints, the results are often not good.

Step back and think: our whole society is steadily being released from material constraints. Much of the disruption of the current economic crisis is - paradoxically - a consequence of that, just like farm work dried up in the face of automation in the nineteenth and early twentieth centuries. That was a huge step forward for society, but it didn't feel good if you were a displaced farmworker.

Sheer economic efficiency means we have basic material abundance. A lot of older kinds of work is starting to dry up. And our economy increasingly has a tendency to go on the equivalent of heroin benders.

We are in the midst of a huge economic phase shift, to levels of needs which require evolution of our economic institutions. It isn't actual material shortage which has created recent volatility, it's psychology and behavior: misperception of risk, lack of restraint, debt benders, welfare ponzi schemes, bad incentives and misbehavior.

The problem isn't wrestling enough to eat from nature any more. It's us. Our problem isn't shortage, but addictions.

The new "commanding heights" of the economy is not to feed people, or give them stuff or routine services. It's to give people purpose and help them flourish when we have satisfied most of the lower levels on the hierarchy of needs. It's finding the good life when you don't spend your day in cubicles.

At present the cubicle is, by default, our vision of the good life, with the corner office its highest expression. But the world of work is starting to be turned upside down.

Aristocratic follies and tragedy should serve as a warning. Near the beginning of this blog I talked about Keynes' famous essay Economic Possibilities for our Grandchildren. Keynes looked several generations into the future:

Thus for the first time since his creation man will be faced with his real, his permanent problem-how to use his freedom from pressing economic cares, how to occupy the leisure, which science and compound interest will have won for him, to live wisely and agreeably and well. ..
Yet there is no country and no people, I think, who can look forward to the age of leisure and of abundance without a dread. For we have been trained too long to strive and not to enjoy. It is a fearful problem for the ordinary person, with no special talents, to occupy himself, especially if he no longer has roots in the soil or in custom or in the beloved conventions of a traditional society. To judge from the behaviour and the achievements of the wealthy classes to-day in any quarter of the world, the outlook is very depressing! For these are, so to speak, our advance guard-those who are spying out the promised land for the rest of us and pitching their camp there. For they have most of them failed disastrously, so it seems to me-those who have an independent income but no associations or duties or ties-to solve the problem which has been set them.

Eighty years on and an eightfold increase in economic wealth later, those problems are live and on stage now.

Keynes, the Bloomsbury aesthete, was suspicious of purpose of course. But purpose is now our main problem. The trouble is our reflex liberalism makes it difficult to talk about ends, and purpose, and substantive content to human flourishing. Our economic institutions have become outworn, devoted to solving the problem of material scarcity that is steadily less relevant, and procedural neutrality.

Economic wealth is insufficient for happiness, as most ethical and religious traditions have always known. It is necessary, perhaps: few people can be happy with monk-like austerity and deprival. But at some point the main obstacles for society become ethical rather than purely economic.

In some ways, our society is like sad Eva Rausing. We haven't figured out how to make wealth work for us, and some of the pathologies lead to foolish decisions and crisis instead.



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