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I’m not going to debate whether you can be too rich or too thin... especially because it was something of a witticism.
Undoubtedly, you can be too thin, but you can also be too rich. When you can no longer really spend money, because your wealth is more-or-less infinite, you are too rich.
It really doesn’t help if you give most of it away. How many of those who are too rich try to overcome the condition by giving all or most of away to charity?
Today, Thomas Sowell has a column about the political dangers of “too much of a good thing.”
He explains: “Higher miles per gallon for cars is a Good Thing in politics, even if it leads to cars too lightly built to protect occupants when there is a crash. More students going to college is another Good Thing, even if lowering standards to get them admitted results in lower educational quality for others.”
Sowell begins by asking how pure is pure. If we can remove 99% of a chemical from the water supply, how much does it matter whether or not we can remove the last 1%? Obviously, it depends on the chemical.
As he remarks, the poison is in the dosage. In small amounts arsenic can be good for you. In large amounts it will kill you.
Sowell’s more salient question is whether removing that extra 1% is worth the cost. Should it be removed if it poses a very small health hazard? Should it be removed if the cost of removing the small health hazard is enormous?
Anyone who exploits our moral sense of what is good in order to impose an ideological agenda based on the idea that there can never be much of a good thing is a fanatic. Beware fanatics peddling goodness.
Sowell adds an important note about the current financial crisis, the one that was produced by an excess of bad mortgages.
Why did we flood the nation’s financial system with bad mortgages? In Sowell’s analysis, we as a society decided that home ownership was a Good Thing. We believed that it was such a good thing that we could not have too much of it. Thus, we tried to ensure that everyone could own a home, regardless of whether everyone could make a down payment or afford the home.
Whatever the benefits to more home ownership, we forgot, as Sowell explains, that too much of a good thing has a cost. Today, that cost is the solvency of the banking system.
Undoubtedly, you can be too thin, but you can also be too rich. When you can no longer really spend money, because your wealth is more-or-less infinite, you are too rich.
It really doesn’t help if you give most of it away. How many of those who are too rich try to overcome the condition by giving all or most of away to charity?
Today, Thomas Sowell has a column about the political dangers of “too much of a good thing.”
He explains: “Higher miles per gallon for cars is a Good Thing in politics, even if it leads to cars too lightly built to protect occupants when there is a crash. More students going to college is another Good Thing, even if lowering standards to get them admitted results in lower educational quality for others.”
Sowell begins by asking how pure is pure. If we can remove 99% of a chemical from the water supply, how much does it matter whether or not we can remove the last 1%? Obviously, it depends on the chemical.
As he remarks, the poison is in the dosage. In small amounts arsenic can be good for you. In large amounts it will kill you.
Sowell’s more salient question is whether removing that extra 1% is worth the cost. Should it be removed if it poses a very small health hazard? Should it be removed if the cost of removing the small health hazard is enormous?
Anyone who exploits our moral sense of what is good in order to impose an ideological agenda based on the idea that there can never be much of a good thing is a fanatic. Beware fanatics peddling goodness.
Sowell adds an important note about the current financial crisis, the one that was produced by an excess of bad mortgages.
Why did we flood the nation’s financial system with bad mortgages? In Sowell’s analysis, we as a society decided that home ownership was a Good Thing. We believed that it was such a good thing that we could not have too much of it. Thus, we tried to ensure that everyone could own a home, regardless of whether everyone could make a down payment or afford the home.
Whatever the benefits to more home ownership, we forgot, as Sowell explains, that too much of a good thing has a cost. Today, that cost is the solvency of the banking system.
2 comments:
"Why did we flood the nation’s financial system with bad mortgages? In Sowell’s analysis, we as a society decided that home ownership was a Good Thing."
That was certainly part of it. Another part was that simplistic but impressive-looking mathematical models were used to assess the risk of mortgage pools, creating a false sense of confidence. Basically, PhDs with IQs of 145 and MBAs with IQs of 130 made lending decisions that an old-line banker with an IQ of 110 would have almost surely known to avoid.
False/exaggerated assertions of expertise are one of the major plagues of our society.
Excellent point. David... it's amazing how people who are not only brilliant but who are working with numbers... which are supposedly more reliable than opinions or ideas... can pretend that their analysis is anything more than glorified opinion.
I agree with you entirely on the tyranny of experts... isn't it the opposite of the free market.
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