Watch QVC Hosts Debate Whether the Moon is a Planet or Star (and a Lesson on Basic Economics)
If you need something to brighten up your day (or make you feel despondent depending on how you look at it), this is living proof that all you have to do to be successful in life is give people what they want at a price that is higher than the cost it takes you to deliver it to them, with sufficient margins for risk, capital tie-up, and opportunity cost. You can literally fail 3rd grade science and, if you satisfy a want, make six, seven, or even eight figures a year. The system we have now forgives a lot of shortcomings if you prove useful in other areas.
Skip to 7:15 in the video and behold the train wreck of scientific ignorance.
You know what’s really scary? This isn’t unusual. There is a very real culture of anti-intellectualism and anti-science in the United States that makes no sense at all. A lot of people think of “science” as a four-letter word rather than a process involving specific steps. They think of critical thinking as blasphemy; the idea that ideas should be ranked based on evidence “True”, “Mostly True”, “Somewhat True”, “Unable to Determine”, “Somewhat False”, “Mostly False”, and “False”. They want black and white, yes and no answers with little nuance even though that is not the way the universe works in most areas.
Even our choices in elected leaders reflect this priority. Have you ever looked at the occupation of most of the legislative branch? Take the 111th Congress as an example (it’s the quickest, easiest occupation list I could find but it doesn’t change much so it will serve our purposes). Out of 535 voting members, a mere 6 were scientists; the same number of representatives who were also car dealers. Only 5 were engineers.
Some of the people assigned to positions in Congress for the Senate and House committees dealing with the environment and scientific areas are about as ignorant of respective areas of influence as these QVC hosts are of space. No joke. Look it up if you don’t believe me.
Going back to the original theme, though, the top comment on YouTube at the moment, with several hundred upvotes, is:
HOW ARE THESE PEOPLE MAKING MORE MONEY THAN ME?
I’m thoroughly convinced that idiots are paid to run the world, while the most intelligent just sit back and laugh.
The answer, which you may not want to hear, is they are providing more value to more people. They are giving people what they want. Nobody is going to pay you for being smart unless you can offer them a product or service that makes their lives better somehow or that they need to survive. You have to convert that intellect into financial capital, exchanging one for the other.
In this case, Isaac Mizrahi is able to create things that a lot of people find attractive and a price point they are willing to accept. He then goes to manufacturers and retailers, working out contracts where he gets royalties or profits on the things that are sold. His official store sells a wide range of stuff; watches, dresses, shoes, purses, necklaces. Someone buying one of those items doesn’t care about his knowledge of celestial bodies. It’s inconsequential. And he exchanges enough of his ideas for cash that The Wall Street Journal finds it newsworthy to report on his multi-million dollar real estate acquisitions in Manhattan.
I think a lot of people were sold a bill of goods. They somehow got the idea just knowing something translates into a nice life; do well in school, go to college, follow your passion, and success will come. That’s not how it works. That’s not how it has ever worked. You have to sell something – your time, your skills, vacuum cleaners, software – that people find of high enough value they are willing to give up their own resources in a trade. Your odds of doing well can be increased if you are passionate about what you’re selling because you’ll work longer and harder at it, but I’ve said it over and over again but it is always true in a free society: Nothing happens until something is sold. You have to either be out there yourself, selling, or own a stake in an enterprise that is.
Should a person be well-educated, knowledgable, and introspective? Sure. Should they seek wisdom and try to better themselves by understanding the basic world in which we live? Absolutely. But those have value beyond monetary value and are not, by themselves, sufficient to provide financially. I spent my undergraduate years in philosophy, ethics, music and liberal arts, along with the finance and accounting courses, to learn how to think; to become a better person who understood the world. While that’s given me a huge advantage in converting my ideas to money – I have a tool box of mental models I can pull upon much more readily – it never, directly, put a cent in my pocket. In the early years, I sold wedding favors and jewelry, sporting goods and freelance services. I used the savings from those activities to buy shares of companies manufacturing everything from airplane engines to teen apparel, collecting dividends from other people selling on my behalf while I slept. It was all a virtuous cycle creating additional streams of cash that came in our CCDA using the business model I’ve written about in the past.
You sell at a profit, build your capital, reinvest that capital, wash, rinse, and repeat. At its core, that is the entire economic game.
For some reason, it seems like people, especially who are coming out of college, think “sales” is a dirty word, convincing themselves that they are somehow exempt; that certain jobs are beneath them or they have a higher purpose that isn’t quite so utilitarian. You’re handicapping yourself if you fall into this trap. I don’t care if you have an advanced degree from one of the most prestigious universities in the world, if the best opportunity you see involves selling hot dogs, sell the hot dogs. If you’re really worth as much as you think you are, you’ll figure out how to get rich from it. Otherwise, you might be deluding yourself as to your own economic value.
You are entitled to nothing. Nobody is going to give you money because you’re a good person. Nobody is going to write you a check because you read Sartre. Nobody cares what your grades were unless you can convert that into tangible benefit. All of those things are vitally important but equally as irrelevant when it comes to your financial self-sufficiency. You have to give back to society by providing something your fellow citizens want. Do early advantages in life matter? You bet. But they aren’t necessary because the upshot is, if you figure out what to sell, you can by-pass a lot of the necessary credentials.
Real world illustration: When he died a few years ago, J.R. Simplot was the 89th richest man in America. He was an 8th grade drop-out who earned more than all of the college graduates working for him combined. What did he sell? Potatoes. The man was the potato king of the United States. Every time you ordered a french fry from McDonald’s, you were indirectly putting cash in his pocket. He then used that money and helped fund Micron Technologies, what is now a $31+ billion market capitalization semi-conducter manufacturer. He understood one, basic truth: He was in the sales business. Whether selling you potatoes or processors, he didn’t care. He just wanted to provide you with something you wanted; something you were willing to hand him cash to acquire. Did you ever once, at any point in your life, eat a french fry and say, “I should inquire as to the college education and transcript of the man who supplied these potatoes to the McDonald’s Corporation”? I doubt it. It probably never even crossed your mind.
When it comes to your economic situation, you are a corporation of one and you are always selling something, even if you are fortunate enough to be living off a trust fund and those sales are being transacted on your behalf. If you’re blessed enough to have married someone who shares your dreams and goals, and will always be loyal to you, you can think of yourself as a general partnership of two, gaining all sorts of economies of scale. Never forget that.
Those who understood this basic truth wouldn’t be surprised that a person can make a fortune despite not knowing the moon is neither a planet nor a star.