The Myth of the American Meritocracy
Lately, I have been reflecting on my place in America’s socioeconomic landscape. Specifically, I am pondering why it is that a college-educated tutor like me can earn more money than the average American worker while laboring fewer hours.
The undercurrent of human nature desires to believe that one’s success comes from one’s talent, perseverance, intelligence, and overall “merit”. We consistently have a bias to overestimate the value of our own contributions. For example, if you ask the members of a research team to each estimate what percentage of the group work they did, the sum of everyone’s answers is around 140%.
As individuals, it is healthy (and indeed psychologically vital) to be proud of the work we do, the things we build, and the way we conduct ourselves in daily interactions. In my life, I am indeed proud of my achievements in the field of education at a young age. But I also modestly reckon with the fact that I was very fortunate to attend elite schools debt-free and to have connections to help build a clientele for my small business.
Deconstructing the Meritocratic Myth
The difficult truth we must face is that our society is not meritocratic. This is particularly true when it comes to wealth.
A comprehensive study of the Forbes 400 found that 40% of the ultra-rich people on the list grew up with family inheritances of over $1 million, and more than 20% made it on the list solely through inheritance. Another report indicated that those in the top 1% inherited an average of $4.8 million. By the lottery of birth, these people started with a level of privilege unthinkable for the vast majority of Americans.
Those with wealthy backgrounds can take risks that others cannot. To simply not have debt to pay off, the fear of becoming homeless, or the short-term need to save money for a possible emergency bill is an enormous luxury. This luxury enables risky investments, while still having a strong safety net to re-invest after failure.
Furthermore, many successful entrepreneurs began with easily accessible startup money and a Rolodex of connections…