How Great American Fortunes Are Acheived

by Dual Income No Kids on November 2, 2009 · 0 comments

Hello Folks,

In my spare time, I’ve been working through a copy of C.W. Mills The Power Elite. For those of you who haven’t heard of the book, its a treatise from the 1950s by Colombia University sociologist C. Wright Mills. The work is a masterpiece and provides a convincing explaining how wealth and power are distributed in American society.

Here is what Mills has to say about how great fortunes are generated in the US. If you’re interested in attaining a great fortune – and you probably are otherwise you wouldn’t be reading this blog – here an excerpt from the book:

I. No man, to my knowledge has ever entered in the ranks of the great American fortunes merely by saving a surplus from his salary or wages. In one way or another, he has come into command of a strategic position which allows him the chance to appropriate big money, and usually he has to have available a considerable sum of money in order to parlay it into really big wealth. He may work and slowly accumulate up to this big jump, but at some point he must find himself in a position to take up the main chance for which he has been on the lookout. On a salary of two or three hundred thousand a year, even forgetting taxes, and living like a miser in a board shack, it has been mathematically impossible to save up a great American fortune.

II. Once he has made the big jump, once he has negotiated the main chance, the man who is rising gets involved in the accumulation of advantages, which is merely another way of saying that to him hath shall be given. To parlay considerable money into the truly big money he must be in a position to benefit from the accumulation of advantages. The more he has, and the more strategic his economic position, the greater and the surer are his chances to gain more. The more he has, the greater his credit – his opportunities to use other peoples money – and hence the less risk he need take in order to accumulate more. There comes a point in the accumulation of advantages, in fact, when the risk is no risk, but is as sure as the tax yield of the government itself.

Once you have a million, advantages will accumulate – even for a man in a coma.

I hope you’ll excuse the archaic language, gender roles have become significantly more egalitarian since Mills wrote and its possible for the same processes to apply equally well to women in todays world, otherwise Mill’s core insight remains relevant and important to understanding how true fortunes are built.



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