Marc Faber, an investor and publisher who is almost as gloomy as I am, made a splash Tuesday when he said on CNBC that the kind of bank failures that have just occurrred in Cyprus could occur anywhere in the world.
He pointed out that 5 percent of the world’s population holds 92 percent of the wealth.
In other words: Our world is an awful lot like the world in The Hunger Games. Maybe the the Academy of Motion Pictures Arts and Sciences stiffed The Hunger Games at the Oscars partly because the kinds of folks who vote on the Oscars are, in effect, the residents of the Capitol of Panem.
I don’t want to create any spoilers, but I think it would be fair to say that, for many reasons, it would be difficult for a producer to sell annuities or long-term care insurance (LTCI) in Panem.
But, on the other hand: The world has always been pretty unfair. It’s not clear that it’s all that much more unfair in a negative way than it used to be. To me, it seems as if the world is “more unfair” because the rich are richer, not that the poor are all that much poorer than they were 100 years ago.
To the extent that, in some places, the poor are more poor, I think that has mostly to do with people who know very well that they’re being obnoxious, violent pigs being obnoxious violent pigs, not with any conscious, organized effort by the rich to keep the poor down. One of the strangest things about the actual Wall Street arm of the Occupy Wall Street movement is that the protesters were, in a lot of cases, yelling at rich 1 percenters who had given generously to Democrats, and, in some cases, to Greens.
My guess is that most of the 1 percenters who were to the right of the protesters sincerely thought that their philosophy would do more to help the poor. I question whether anyone can really come up with 10 rich Americans who truly want to keep poor people poor, on purpose.
So, why do most have so little, and a few so much?
One reason is that, of course, even though few people consciously think of themselves as wanting to rig the system in their favor, people who get a chance do so all the time, with gusto.
Many rich people are lucky, talented and driven, and they have fun seeing a big number in the net worth cell of the spreadsheet.
Some rich people want to have enough money to enjoy expensive hobbies, such as owning palaces and sending people to Mars; to make their descendants rich; and to support their favorite nonprofit organizations.
But, then, even rich people worry about financial security. Plenty of rich people have died poor. Rich people can lose money because of overspending, fraud, outright theft, the collapse of banks, confiscatory tax policies, political persecution, riots, war, natural disasters, or the collapse of countries or entire civilizations. Maybe it will take having $1 million in cash to buy a cup of coffee in 2050. Who knows?
Of course, many people of modest means end up looking rich on paper, simply because they or professionals have managed their pension or retirement savings arrangements well.