When is Enough enough?

“Nothing is enough for the man to whom enough is too little,” advised Washington Irving (1783-1859), a first generation of Americans named after President George Washington. Irving was one of the first American writers to win world acclaim. He was a unique combination of author and diplomat; his literary successes included “Rip Van Winkle” and “The Legend of Sleepy Hollow” as well as biographies of George Washington and the prophet Muhammad. He also served as the Secretary of the American delegation to London and served as the Minister to Spain under President John Tyler.

 

While history does not indicate the person to whom Irving was referring, his quote could easily have referred to the life and morals of another famous American, Cornelius Vanderbilt (1794-1877), who lived about the same time as Irving. Vanderbilt ultimately became one of the richest men in the country, dominating the transportation industry with his ownership of steamships and railroads. At death in 1877, his wealth was estimated to be $100 million, the equivalent of $143 billion in 2007. By comparison, his modern equivalent, Bill Gates, had an estimated net worth in 2014 of $81 billion. Vanderbilt’s entire estate was willed to his family without deduction for any charities or estate taxes, creating one of America’s first extraordinary family fortunes.

 

Vanderbilt represented the emerging American businessman—self-taught, self-made, ruthless, and focused on building wealth and power—who began to dominate the world’s economies. Like other powerful businessmen of the era, they considered ethics primarily for others or public consumption without application in their own lives. While they preferred to negotiate on friendly terms (since it was faster and easier, they were not adverse to buying off politicians, double-crossing partners, or using the friendly police to break strikes or intimidate workers.

 

According to a New York Times article, Vanderbilt was a “notoriously hard man” who had little room in his heart for charity and none at all for guilt. He admitted that he had been “insane on the subject of moneymaking all my life” and had little concern about laws that might limit his growing wealth. When asked if he worried about the Government’s reaction to his monopolistic tactics, he responded, “What do I care about the law? Ain’t I got the power?”

 

Rather than suing those who he thought had wronged him, Vanderbilt’s practice was to ruin his enemies, punishing them and their families with no mercy. Not surprisingly, Vanderbilt, though feared, was the often vilified for his tactics and considered to the poster boy of the Robber Baron elite. His son and 95% heir, William (Billy) Vanderbilt was equally arrogant, having learned his business skills from his father. When publicly questioned in the newspapers about the public’s reaction to doubling the price of transit fare, Billy famously declared, “The public be damned.” A chip off the old block, Billy carried on his father’s legacy, doubling the family wealth in his lifetime.

 

What drives men like Cornelius and William Vanderbilt to pursue such levels of wealth that it persists long after their death or the deaths of their children and grandchildren? What makes men practice cutthroat business tactics—dishonesty, cheating, lying, disloyalty, theft, inequality, even murder—for another dollar of revenues or profits? If wealth makes you happy, does more wealth makes you happier? As Irving asks, how much is enough?

 

The link between wealth and happiness has been the subject of numerous studies. A 2006 study suggested that happiness and wealth go hand-in-hand until reaching an annual income of $70,000 ($151,000 in 2014), but there appeared to be no correlation after reaching the $70,000 income level. Nobel laureate psychologist, co-author of the 2006 study, and Princeton professor Daniel Kahneman claimed that people with above-average incomes are relatively satisfied with their lives but are barely happier than others in moment-to-moment experience. They also tend to be more tense and spend less time in enjoyable activities. At Vanderbilt’s death, the estate was tied up for years with family lawsuits. As far the benefits of the inheritance to his children and grandchildren, grandson William Kissam Vanderbilt said, “Inherited wealth is a real handicap to happiness…It has left me with nothing to hope for, with nothing definite to seek or strive for.”

 

As for me, I realized a long time ago that a future as a nationally-known tycoon, jet-setting around the world with legions of retainers to satisfy any conceivable want was not for me. The cost to pursue wealth was simply too high when compared to the benefits of privacy, more family time, and less hassle and worry keeping up with my investments. Dropping out of the asset competition has helped me overcome or avoid the psychological stressors of greed, envy, and jealousy that frequently accompanies wealth accumulation and plagues every human being to some extent.

 

More recent happiness/income studies suggest that the amount of money you have is less important to your happiness than how you spend it. According to a Wall Street Journal article, giving money away makes people happier than lavishing it on themselves. And spending money to buy experiences and recover memories is more satisfying than purchasing assets. Whether you are starting a career or ready to retire, it is important to realize what will make you happy and pursue those conditions and experiences than wealth itself. As rich men and women invariably discover, hearses do not pull U-Hauls to grave sites.