|
Advertisement
|
« Recommended Reading | Main | French Engineers Set Rail Record — With a Bullet »
May 8, 2007
Think You're Smarter Than Donald Trump?
The middle class in the U.S. is waning, and not since the Roaring Twenties have the rich been so much richer than everyone else. Yet intelligence doesn't explain it, according to a new report that says IQ has really no relationship to wealth. So the rank-and-file are likely to be just as smart as millionaire CEOs? You don't say.
It's pretty clear that overall wealth does not necessarily equate to talent or even basic business ethics. And it seems pretty safe to assume that it doesn't take a rocket scientist to make a lot of money.
On the matter of the latter assumption, now we have the proof. A recent report concluded that intelligence is not linked to overall wealth.
A nationwide study recently found that people of below-average intelligence were, overall, just about as wealthy as those in similar circumstances but with higher scores on an IQ test.
"Your IQ has really no relationship to your wealth," according to Jay Zagorsky, a research scientist at Ohio State University's Center for Human Resource Research and author of the study.
Although other research has also found the IQ-income link, this is one of the first studies to go beyond income to look at the relationship between intelligence and wealth and financial difficulty, Zagorsky said.
"Financial success for most people means more than just income," the research scientist continued. "You need to build up wealth to help buffer life's storms and to prepare for retirement. You also shouldn't have to worry about being close to or beyond your financial limits."
Past studies have shown that intelligence positively affects income, or the money a person makes per year, as LiveScience recently pointed out. "Individuals with a higher IQ typically have a higher educational attainment and a higher occupational status and that is very well established," said Ruth Spinks, a behavioral and cognitive neuroscientist at the University of Iowa, who was not involved in the latest study.
However, just because someone has a high-paying job doesn't mean he or she is wealthy, which is a measure of the difference between a person's assets and debts.
The study, which has appeared online in the journal Intelligence, was based on data from 7,403 Americans who participated in the National Longitudinal Survey of Youth, which is funded primarily by the U.S. Bureau of Labor Statistics (BLS). Participants completed the Armed Forces Qualification Test (AFQT), a general aptitude test used by the Department of Defense (DOD). Participants also were surveyed about their income, total wealth and three measures of financial difficulty: if they currently have any maxed-out credit cards; if over the past five years they had any instances where they missed paying bills; and whether they ever declared bankruptcy.
(Of course, basic psychology states that there is more than one type of intelligence; some say five, seven or more, in fact. The AFQT score, however, was derived from performance only on the verbal and math subtests of the ASVAB; specifically, word knowledge, paragraph comprehension, arithmetic reasoning and mathematics knowledge, according to Kaplan Test Prep and Admission. But we digress.)
Researchers at the University of California at Berkeley may call it "disinhibited," as Richard Conniff, author of "The Natural History of the Rich," recently addressed in the International Herald Tribune:
Researchers led by the psychologist Dacher Keltner took groups of three ordinary volunteers and randomly put one of them in charge. Each trio had a half-hour to work through a boring social survey. Then a researcher came in and left a plateful of precisely five cookies. The volunteer who had randomly been assigned the power role was also more likely to eat it with his mouth open, spew crumbs and get cookie detritus on his face and on the table.
It goes without saying that people with money typically have more power than those without. And Keltner theorized that "elevated power leads to behavioral disinhibition and reduced vigilance," as he says on his university Web page. Simply put, the UC-Berkeley researchers theorized that getting power causes people to focus so keenly on the potential rewards — such as money, sex, public acclaim or an extra chocolate-chip cookie — that they become insensitive to, or even oblivious to, the people around them.
Of the recent Ohio State University study, participants with higher IQ scores tended to earn higher incomes, with each additional IQ point associated with an income boost of $202-$616 each year. "The results showed a financial sweet spot of sorts that hovered around the average IQ score, for which people had the lowest financial distress," LiveScience noted.
Yet, even though the study's brainiacs earned higher incomes on average, they didn't have the savings to show it. In fact, some higher-IQ people had more problems with maxing out credit cards and missing bill payments.
Compared with people of other industrialized countries, U.S. citizens do not save much money. In fact, 43 percent of all consumers spend $1.22 for every $1 they earn, according to Carl George, chairman of the National CPA Financial Literacy Commission.
And in 2005 and 2006, the national savings rate swung to a negative number for the first time since the Great Depression.
When people make a lot of money, they're able to spend a lot of money. The problem isn't a single extravagant purchase, but a lavish lifestyle in which they spend more than they earn. Even the rich are subject to the fundamental law of wealth. "Real wealth isn't about earning money — it's about keeping money," notes the Get Rich Slowly blog.
So, although Zagorsky's results confirmed research by other scholars that show people with higher IQ scores tend to earn higher incomes, when it came to total wealth and the likelihood of financial difficulties, people of below-average and average intelligence did just fine when compared with the super-intelligent.
(It seems only fitting that some mainstream news coverage of this intelligence-wealth finding is accompanied by a picture of Paris Hilton with the caption, "Paris Hilton ... you do the math.")
"Intelligence is not a factor for explaining wealth. Those with low intelligence should not believe they are handicapped, and those with high intelligence should not believe they have an advantage."
Tell us what you think: Is there a link between wealth and intelligence?
Resources
You Don't Have to Be Smart to Be Rich, Study Finds
Ohio State University, April 24, 2007
Not So Smart? You Can Still be Rich!
by Jeanna Bryner
LiveScience, April 25, 2007
When the rich get stupid
by Richard Conniff
International Herald Tribune, April 4, 2007
Early Tests Predict Adult IQ
by Melinda Wenner
LiveScience, April 16, 2007
The Most Important Money Tip
by J.D. Roth
Get Rich Slowly, July 5, 2006
Dacher Keltner, Ph.D., Stanford University
UC Berkeley, Dept. of Psychology
Bankers, experts decry lack of savings
by Sherry Slater
The Journal Gazette, April 16, 2007
Intelligence not linked to wealth, study shows
Agence France-Presse, April 25, 2007
Trackback Pings
TrackBack URL for this entry:
http://news.thomasnet.com/mt41/mt-tb.cgi/1033
|
Advertisement
|
Comment
8 CommentsThe best quote on this that I saw was attributed to anonymous. It went like this:
"The wise know the value of riches, seldom do the rich know the pleasures of Wisdom."
It seems to make sense. It also gives rise to the question of whether wisdom and smartness are the same thing or not. Probably they overlap and also have some differences. Hitler was smart and rich; wouldn't want to be like him though.
To some degree, in order for the wise to survive, they have to be smart too.
May 8, 2007 2:55 PMMonkey Hockey: Pure Monkey Dung.
May 23, 2007 3:13 PMI've had the IQ tests and the early AFQT test. Scored scary high on both - and I wasn't rich for a long time. Not sure I am now, but I make good money and have little debt. Of course, I live quite modestly compared to folks that make 1/2 of what I do.
The 'smart - rich' cliche works for a little bit, but not for long. I think for the very rich, it's usually a willingness to be ruthless in pursuit of wealth. There's plenty of evidence for that (Carnegie, Rockefeller, Kennedy, Gates). There's also evidence for the 'bootstrap' fallacy; a fair amount of 'new wealth' is built on the shoulders of older wealth or access to resources not available to most (Trump, Turner, Gates).
It's almost impossible for someone to get rich and be moral without someone else giving them a big boost in footing the bill.
May 23, 2007 3:23 PMThe only people I know who are really happy are those who are willing to give it away if necessary. They don't live for wealth or possessions but enjoy them because their happiness does not depend on them. It's never a matter of intellegence, morals, ethics, its what you value in your heart that makes one happy. Sounds philisophical 'cause it is. It's not money that corrupts, the love of money does.
I save money and buy with cash. I own all I have and live a very stress free life. What about you?
May 23, 2007 5:16 PMWhat's this about wealth not being fullfilling? Baloney! That's a lazy mans excuse.
I've been told I'm intelligent, have held high responsibility positions, nearly been bankrupt twice (but refused to file and paid off $500,000 in business related debts). If you look closely around you, you'll see a school teacher who owns $2 million worth of rental properties, a carpet installer who owns strip malls and car washes, and an oilfield worker with a paid off home and enough money to live irresponsibly. The key is they don't live irresponsibly. They are today's millionaires and no one sees them.
As for me, I'm debt free, employed (no more self employment for me)and well on my way to a million in the bank - furthermore I give to everyone and everything I want to help. Want an excuse? Blame your IQ, accuse the love of money of having no nobility, but you know deep inside you can't figure out why you don't get what you deserve. Ah, but you do get what you deserve with your responsibility.
May 23, 2007 7:15 PMI'm rich, smart, and happy. Wonder what went wrong with the theory espoused by the researchers. Could it be that they overlooked some facts and relationships?
May 23, 2007 8:12 PMIn fourth grade, I could draw a complete schematic of a TV set, and understand how it functioned. My IQ test said I was in the top one-quarter of one percent of the population. I was valedictorian of my high school class. In undergraduate engineering school, I was first in my department, out of 92 people. The graduate school I went to was rated first in my field in the entire country, at the time I was there. I work in a government organization that supposedly is one of the top research organizations in the country. (Although I sincerely think that, in recent years; it has been greatly over-hyped, and witnessed a major decline.)
Am I bragging? No - but I may be bitter. By now, you would think I should have been the president of a major corporation, if success was based on intelligence alone.
But I'm one of the lower-paid salaried employees in the entire division. I see people with only high school educations, and who have IQs demonstrably 40 points lower than mine, being promoted into positions nearly as well-paid as mine.
I see people with questionable qualifications and very marginal degrees in non-technical fields being promoted above me; and given salaries $20K higher. Somewhat dim "Good Old Boys" run this supposedly sophisticated research institution, and hire their somewhat dim pals to fill up the government gravy train.
I've been told that I'm considered to be "The Nutty Professor". The person who told me this apparently didn't mean any offense. But considering the original Jerry Lewis movie, NO ONE would want to be seen like the bumbling, socially-outcast title character. I'm marginalized in a back office, doing calculations. I am usually not involved in the mainstream activities or planning. They're afraid of what might happen if I might actually start getting recognition. But they know they've got me effectively walled off.
Our 8th grade advanced-placement English teacher told us, on the last day of school; that our intelligence would prove to be our curse. She said that we would notice things that would bother us, while the great mass of people would live happily in ignorant bliss. She said that we would never be able to relate to ordinary people, and would always be excluded from the mainstream.
Her prediction was right. Intelligence can hold you back in society. The "normal" people can socialize with the other "normal" people better, and develop relationships that will get them ahead.
But then again, I think I have more sense of values than most of the people who blatantly ingratiate themselves with management. There's a great amount of pride in knowing that I stand on the work that I do, rather than on ingratiation. I've always enjoyed the technical portion of the work, and found the management aspects boring. So I stuck with what I enjoyed. But it's the ingratiation that gets you ahead. I've always said what I think; and what I think about people. It's been my downfall.
I no longer get much identity from my job, and get most of my satisfaction from hobbies and working at home. Those who desperately try to ingratiate themselves will dig themselves into early graves, trying to get just a little more cash. I am going to take some time to relax, and savor what life has to offer. That's what I believe is the real reason we are on earth for.
May 24, 2007 3:12 PM
