Well I for one would much prefer people get rich in the private sector, and then go into politics, instead of going into politics and then getting rich, which seems to be standard-operating-procedure these days.
The notion that wealth prior to politics might deter in-office enrichment is understandable, but the reality is a bit more complex.
Wealth doesn't inherently negate the potential for conflicts of interest or policy biases that could benefit a politician's own financial interests. After all, the same drive that helps individuals amass their fortunes—ambition, competitiveness—doesn't just switch off once they're in a position of public power. And personal integrity isn't tied to one's bank account balance; it's about character and the robustness of political and legal accountability systems.
So, regardless of whether someone is wealthy before politics, without strong ethical standards and transparent oversight, the risk of using political office for personal gain remains.
> And personal integrity isn't tied to one's bank account balance; it's about character and the robustness of political and legal accountability systems.
Absolutely disagree with this—you can't acquire a billion dollars without sacrificing major ethics.
Which ethics and how does one determine if they are major or not?
I’ve seen statements in this vein a lot. It’s quite vague and often confusing one’s relative morals for what society has collectively deemed acceptable.
Well, what do you consider ethics? I was coming from a place of you should give away all the money you don't need because the world would be better for it.
Notional wealth is just a number. A fair number of billionaires started something, retained equity, but exited their business that then went on to be wildly successful. Further many billionaires are born into their wealth. I think this pervasive attitude erodes both the standard the extremely wealthy should be held to and is overly simplistic. There are many billionaires who are at their core unethical. There are many who are very ethical but their outsized influence puts them in situations to make decisions with no easy answers. And there are many that are simply people that happened into the wealth randomly.
> risk of using political office for personal gain remains.
It may remain, however that doesn't mean the temptation isn't crippled.
A 1 billion net worth person is less likely to be tempted by a $50,000 "enrichment" opportunity compared to someone making $174,000 with a net worth of less than 100k.
A 1% chance of a 1% change in a $1B portfolio is worth $100k. Do you think it would be difficult to arrange for that 1% chance of a 1% change through plausibly deniable policy changes? Do you think it would be possible to achieve larger swings at higher reliability? How much do you think those plausibly achievable swings would be worth on a $1B portfolio?
Working for a living and owning things for a living provide very different incentive landscapes that are often opposed to one another. Assets pay you in proportion to how much you own, so "owning things for a living" is roughly synonymous with a net worth above a line that lands somewhere between $10M and $100M depending on how you draw the line. In any case, if you work for a living, you definitely do not want to be represented by politicians who own things for a living.
I don’t know about that - people in positions of wealth are fairly likely to shoplift. If you make $200k a year, why shoplift an $80 bottle of liquor? I would think the same holds true when considering your given scenario.
That is very exclusionary to would-be bribes^H^H^H^H^H^Hdonations from people of lesser means.
As an alternative I propose the Aztec method. While they are in office, the elected is given every possible luxury and upon leaving their sacrifice is ceremonialized in a very public way so that all know the elected did not perform their duty for personal gain.
> A 1 billion net worth person is less likely to be tempted by a $50,000 "enrichment" opportunity
This is a good point. People act rationally all of the time, plus nobody has ever become a billionaire by compulsively capitalizing on every opportunity to gain wealth.
I mean, you'd think, but look at the petty corrupt bullshit Trump got up to! Going to his hotels with his secret service people... then overcharging them for rooms. Like, just ridiculous, and not a consequential amount of money for him, but he still _did it_.
Eh? I mean you could argue about how _important_ it was (personally I would class it as somewhat important, but very, _very_ funny; it's just so petty), but it did clearly happen; there's not much doubt about that.
According to the NPR article, the SS has a $200 per-diem limit for hotel expenses and by staying with Trump at his hotel (where rooms run about $1k/night), exceeded this limit.
This raises the question: how do accommodations work for president's entourages when traveling? I have a hard time believing that they restrict themselves to Holiday Inn tier establishments. Hotel rooms in larger cities can easily run $500/night, especially on a short notice.
Yeah. The risk of corruption doesn't just "remain" for wealthy politicians -- their investments give them a much more lucrative avenue through which they can get paid for policy and through which their well-heeled donors can monetize policy changes!
A 10% chance of swinging a 001M position 10% is worth $10k.
A 10% chance of swinging a 010M position 10% is worth $100k.
A 10% chance of swinging a 100M position 10% is worth $1M.
A 10% chance of swinging a 001B position 10% is worth $10M.
A 10% chance of swinging a 010B position 10% is worth $100M.
A 10% chance of swinging a 100B position 10% is worth $1B.
To you and I, lobbying and politicking is an expense. To the rich, it is an investment with expected monetary return.
> the same drive that helps individuals amass their fortunes—ambition, competitiveness—doesn't just switch off once they're in a position of public power
I was hoping it would switch off when they amass more money than they can spend in their lifetime
> the risk of using political office for personal gain remains.
You're absolutely correct. I think the person you were replying to was being pithy about the fact we have essentially in-the-open legal corruption happening in the US today where politicians can get elected to high office with minimal personal fortunes and be millionaires before they complete their first term simply due to the nature of that corruption (for instance, legalized insider-trading for Congress).
I believe the insider-trading thing pretty small in real world impact.
Paid speeches, book deals, consulting payments and jobs for family members or after holding office are the more significant items.
We have a funny system where paying a politician $250k for a one hour speech to your company, trade group, union, political action committee or whatever is treated as a perfectly reasonable speaker fee, and totally different than just handing the politician the money in a briefcase. Or hiring a politician's 22 year old new-grad child at an executive salary.
Oh, I may have missed the nuance there, thank you!
I very much am against the corruption we witness so blatantly. Personally I thought that if wealthy people were elected to office we may be able to eliminate some of that, but it seems as though if anything they are just better at it.
at the same time, we do want poor people to be able to represent people. It would also be bad if Congress was only out-of-touch rich people.
There was a bit of a brouhaha with the last few Congresses where incoming freshmen representatives who had poor backgrounds were having difficulty securing housing due to poor credit history, even though their new salaries put them squarely in upper tax income brackets.
In practice, I think this gets you politicians who are completely detached from the common man – what do you mean you don’t have a personal maid that does all your shopping for you?
I don't think that's true – look at your average Wall Street first generation finance bro, I don't think they can understand the plight of the single mother clipping coupons to scrape by.
Is the 'system' failing, or did an individual fail to understand the system and then learn to adapt and overcome against the odds?
I would prefer to vote for the person who grew up in poor/difficult circumstances and managed to succeed (in some way) despite those circumstances, over someone who grew up in the same poor circumstances and couldn't figure out how to make it.
Which person is better equipped to help people help themselves? The one who did it? or the one who couldn't figure out how to do it?
Name a "self made" person - presumably an infant who was abandoned and somehow survived on their own, and then built everything they used to live on. Pedantic I'm sure, but it's such a ridiculous idea in a modern industrial society as to be meaningless anyway.
either way it's wrong, the "rich" people often get there through cutthroat practices and then want to keep their fortune via policy making... not much better
> instead of going into politics and then getting rich, which seems to be standard-operating-procedure these days.
I can't think of a single billionaire who made their wealth while in politics, or after. You can come out of politics and get a kushy low-seven-figure lobbying job, at best. Maybe if you were really senior (congressional leadership, VP, president) you can write a few books and give a bunch of speeches and get to the tens of millions in income, but that's as far as it goes.
Basically "politics" produces maybe 5-6 people per decade able to pull what a median FAANG acquihire founder gets. That sounds... pretty democratic to me, really.
> I can't think of a single billionaire who made their wealth while in politics, or after.
Common in extremely corrupt authoritarian regimes; Putin would be an obvious example. But yeah, less common in democracies; I'm struggling to think of a modern example.
Sure, but those are two of the least egalitarian things that can happen in a democracy. Conflicts of interest abound. Business and politics should be discouraged from intertwining at the individual level like that.
I prefer strongly applying ethical standards in politics. This would protect the public against corruption by public officials than just one variety of conflict of interest.
I would rather they get rich after being in politics, but not because of special consideration while in politics.
When I was younger, I used to have the attitude that “if they got rich running a business, clearly they know how to succeed and would be great to run the country”. But that turns out to be naive thinking.
I have absolutely no problem with a former politician becoming a millionaire (or billionaire or they can do it!) from using what they learned while in office, provided they didn’t use their time in office setting up for that against the betterment of the public. In my experience, it’s easy to quickly forget what it is like to be an “average citizen“ when you can pay $10 for a banana. How can you truly represent what you don’t understand?
Seeking political office is asking for punishment. The media can be brutal. A small slice of the general population will be haters no matter what and in absolute numbers that's a lot of people that hate you.
Billionaires can insulate themselves from this brutality and may have some experience with it already. Non-billionaires can't, and so it's just not worth it to run for office unless you care more about power than about yourself and your family.
Not saying that billionaires are great politicians or anything, but it certainly makes sense. If we want something better we need more civilized discourse.
"The media" can also be pretty favorable in practically any set of loosely held beliefs you want to cobble together into a campaign. You'll find some platform willing to give you a mic to espouse the ideology with a nudge, nudge, wink, wink to working closer together once you accumulate power. I'm skeptical that tying politics and wealth in any form leads to a good outcome.
Favorable in that they may support your acquisition of power. Almost never favorable at a human or family level.
So if all you care about power, they media is a great ally. If you also have ordinary human desires, like not having a constant mob of haters saying horrible things to you and your family, then the media is not great.
In other words, the media filters out most normal people from politics by the sheer horrribleness of the process.
It also costs money to be a politician. Billionaires are able to loan to their campaigns pretty heavily, Michael Bloomberg loaned himself $65M to get re-elected as NYC mayor in 2009. There’s no political expenditure cap in the US and media slots are not cheap.
- Working behind the scenes doesn't seem to be enough. Otherwise, why bother running for office. Of course, it can not be enough in different ways - not enough power, not enough fame.
- The same people are successful in wildly different fields - or these fields aren't so different at all.
> The same people are successful in wildly different fields
I mean, define _successful_. I can't think of any _highly regarded_ billionaire politicians. In democracies they rarely even get elected; they just blow a load of money on a futile campaign.
"Held or sought" is quite a catchall category. People concerned with the influence of money on elections should take solace in the time Bloomberg spent $100 million in the Presidential primary to win American Samoa.
Meg Whitman, although not a billionaire, is another encouraging example. By the end it's estimated she had so saturated the California airwaves that her ads were losing her votes.
I think that actually worked out in his favor, too, because had someone like Elizabeth Warren or Bernie Sanders won, he'd have had a much larger tax bill than that.
They’d have no control over tax policy in Presidential office. Bloomberg burned almost $1B to realize he was unviable. If that’s how billionaire wish to divest their wealth, with enormous spend that gets no traction, we should not get in their way.
What about the billionaires/multimillionaires who don't seek any positions but donate to campaigns, PACs, ideological think-tanks.
This article would never have the Koch brothers in their study because, technically, they never sought to be in office, even though we know they donate billions of dollars to their think-tanks and super PACs.
Interestingly, there's huge variance by country. Billionaires are much more likely to seek office in countries where this is either a source of valuable behind-the-scenes connections (e.g. China) or a way of preventing the regime from plundering their wealth (e.g. Russia).
Notably, it's only 3.7% in the US, & 5% across democracies – but 29% in autocracies, and 36% in China.
There are some fishy things in their choices, with potential rationales but still creating caveats about their results. For example:
• "excludes politicians and royal family members whose wealth and political power cannot be disentangled. Vladimir Putin, for example, is not on the list despite speculation that he may be the world’s wealthiest person"
• those who had political roles before they became billionaires, like Sheryl Sandberg, are excluded because "they reflect a different dynamic than the wealth-to-politics trajectory that we explore in this paper" (?!)
• it even includes failed runs (election losses & early-aborted campaigns) & some positions that can be almost entirely ceremonial (ambassadorships to minor countries)
Further, the only comparison to rates of participation of non-billionaire groups is a vague mention of that only "4%" of people in "pipeline fields" like "law, business, education, and community activism" who "consider" running-for-office do so.
Notably, that's about-equal to the US billionaire's "3.7%" participation. And, it'd be interesting to drill-into the mega-political-feeders (in the US) – like children/family of politicians, or law degrees from top/Ivy schools. I suspect those may blow billionaire involvement rates out of the water.
> those who had political roles before they became billionaires, like Sheryl Sandberg, are excluded because "they reflect a different dynamic than the wealth-to-politics trajectory that we explore in this paper" (?!)
She was a civil servant, who then moved into the private sector doing ad sales, and won the lottery twice (she joined Google in 2001 and Facebook in 2007). Not to say she wasn't skilled, she clearly was, but she was also very lucky with timing and with which companies she joined. Going from public to private sector isn't uncommon, and her role in Google wasn't closely related to her civil service role. There are, presumably, hundreds if not thousands of civil service people who left the same year she did, took roles in the tech sector, but oops, most of them joined Yahoo or Pets.com, or a million companies who were gone by 2003, and that was the end of that. She's such an edge-case that it probably makes sense to exclude her.
Now, if Nick Clegg (former leader of the LibDems and Deputy PM of the UK, now works at Facebook) were to become fabulously wealthy, that would be more relevant (and arguably more worrying); so far that hasn't really happened tho.
EDIT: Yahoo may be a bad example; thinking about it I'm not sure it actually was in decline in 2001. Worldcom? Webvan? Netscape? Whatever; loads of examples available; most high-flying exec types joining tech companies, just as well-regarded as Google at the time, out of the civil service (or anywhere else) in 2001 would've ended up with some worthless paper, but joining _Google_ was winning the lottery, and then she did it again with Facebook.
> • those who had political roles before they became billionaires, like Sheryl Sandberg, are excluded because "they reflect a different dynamic than the wealth-to-politics trajectory that we explore in this paper" (?!)
That seems sensible to me. Official corruption seems like an entirely different phenomena to successful businessman interested in second careers in politics or philanthropy. Xi Jinping is a billionaire, and Mike Bloomberg is a billionaire, but when they are seeking votes for an elected position, it's rather different things...
Sure, that's what they want to focus on & they have a high-contrast read on "Forbes-certified-billionaire-then-politics".
But without even accusing Sandberg of any "official corruption", she was already in the sort of "feeder roles" towards politics (Ivy-league Economics BA, MBA, position at global QUANGO World Bank) – that I find this paper under-considers as useful comparison-classes – before her first US government position.
And, she was already potentially a centi-millionaire (via her Yahoo exec then SurveyMonkey CEO late husband) before her roles at Google & Facebook. (If there were enough data, it might be found that centi-millionaires are in even more of a "sweet spot" for politics than "billionaires", given the extra attention/resentment towards the upperest-top.)
So while I don't blame the authors too much for their choice of what to emphasize, & data-limitations, she's indicative of other parts of the full picture.
Characterizing the full probabilistic 'state-machine' of people's transitions between [education, inheritances of money or name-recognition, levels-of-wealth, private-sector-offices, public-offices, etc] could be a valuable extension of this tiny cross-sectional analysis.
And, given that they did enough analysis to exclude Sandberg-types from their counts, it'd be good to have seen how many such people were so-excluded – a salient detail I didn't notice from a skim of their paper.
Thinking about this comment; I imagine some are sincere, but I imagine for more it's PR as you say, or just a thing to do at that strata of wealth - they have all kinds of means at their disposal of influencing political or cultural change, actually running for office seems (as you point out) likely less about obtaining the office or the power.
I also wonder if resigning yourself to some sort of business that you can make appear successful while you live off your inheritance is like their working retail, and getting yourself onto a board, or into office is like being a doctor or lawyer to us ;)
This is just pure poor person musing though for funsies on lunch :P
A few poor souls accidentally won their seats. And since backing out would be a sign of weakness, they've had to keep up the facade for going on decades now.
Is this increasing or decreasing? If it 's increasing it 's worrying, because it means that more power lies with in the State than with private enterprise. If it's decreasing it would mean that rich people feel their money has more power. Obviously money is more equally distributed than positions of state power.
Maybe that explains why billionaires are so enmeshed in public function in autocratic states: their money doesn't give freedoms. Extreme examples are the Saudis where money and power are one and the same.
Wild. If I was a billionaire I'd be way too busy figuring out how to spend money and time with my loved ones before we're all dead. I'd maybe join a non-profit, but a political office wouldn't even cross my mind.
The Base rate: It is the proportion of individuals in a population who have a certain characteristic or trait. For example, if 1% of the population were medical professionals, and remaining 99% were not medical professionals, then the base rate of medical professionals is 1%.
The base rate for people who have never held or sought office is much higher than 89%. It's not enough to mirror the number around 100% to make a small number into a big number, you also have to compare with the base rate.
"Large portion of asset-controlling people seek to influence laws"
Tell me, has there ever been a government not controlled by wealthy people? Does the form of government really matter if the laws are all written by lobbyists and company PR (democracies) or bribed officials (dictatorship) or both (socialism)?
I think more people would be shocked if they knew how common this was.
As a high-net worth individual, either be present or pay someone to do your bidding - but don't ignore your chance at maintaining and growing your assets!
