In defense of the doomsday-minded super-rich

Post Syndicated from Michal Zalewski original http://lcamtuf.blogspot.com/2017/02/in-defense-of-doomsday-minded-super-rich.html

Several days ago, The New Yorker ran a lengthy story titled
“Doomsday prep for the super-rich”. The article revealed that some of the Silicon Valley’s most successful entrepreneurs – including the execs from Yahoo, Facebook, and Reddit – are planning ahead for extreme emergencies, “Doomsday Preppers” style.

The article made quite a few waves in the tech world – and invited near-universal ridicule and scorn. People sneered at the comical excess of blast-proof bunkers and bug-out helicopters, as if a cataclysm that kills off most of us would somehow spare the nouveaux riches. Hardcore survivalists gleefully proclaimed that the highly-paid armed guards would turn on their employers to save own families. Conservatives rolled their eyes at the story of a VC who is preparing for the collapse of the civilized world but finds guns a bit too icky for his taste. Progressives were repulsed by the immorality of the world’s wealthiest people wanting to hide when the angry underclass finally takes it to the streets. In short, no matter where you stood, the story had something for you to hate.

My first instinct was to join the fray; if nothing else, it’s cathartic to have fun at the expense of people who are far wealthier and far more powerful than we could ever be. Sure, I have written about the merits of common-sense emergency preparedness, but to me, it meant having a rainy day fund and a extinguisher, not holing up in a decommissioned ICBM silo with 10,000 rounds of ammo and a pallet of canned cheese. Now hold my beer and let me throw the first stone!

But then, I realized that the article in The New Yorker is a human interest piece; it is meant to entertain us and has no other reason to exist. The author is trying to show us a dazzling world that is out of ordinary and out of reach. It may be that the profiled execs spend most of their time planning ahead for far more pedestrian risks, but no sane newspaper would publish a multi-page expose about the brand of fire extinguishers or tarp favored by the ultra-rich. The readers want to read about helicopters and ICBM silos instead – and so the author obliges.

It is also a fallacy to look at the cost of purchases outlined in the article in absolute terms. For us, spending $5M on a luxury compound and a helicopter may seem insane – but for a person with hundreds of millions in the bank, such an investment would be just 1% of their wealth – a reasonable price to pay for insurance against unlikely but somewhat plausible risks. In terms of relative financial impact, it is no different than a person with $10k in the bank spending $100 on a fire extinguisher and some energy bars – hardly a controversial thing to do.

What’s more, although we’re living in a period of unprecedented prosperity and calm, there’s no denying that in the history of mankind, revolutions happen with near-clockwork regularity. We had quite a few in the past one hundred years alone – and when the time comes, it’s usually the heads of the variously-defined aristocracy that roll. Angry mobs are unlikely to torch down Joe Prepper’s cookie-cutter suburban neighborhood, but being near the top of the social ladder carries some distinct risk. We can have a debate about the complicity of the elites, or the comparative significance of this risk versus the plight of other social classes – but either way, the paranoia of the rich may be more grounded in reality than it seems.

Of course, an argument can be made that preparing for the collapse of the society is immoral when their wealth could be better spent on trying to bridge the income gap or otherwise make the world a more harmonious place. It is an interesting claim, but it rings a bit hollow to me. We would not deny the rich the right to buy a fire extinguisher or a bug-out bicycle; our outrage is rather conveniently reserved for the purchases we can’t afford. But more importantly, prepping and philanthropy are not mutually exclusive; in fact, I suspect that some of the folks mentioned in the article spend far more on trying to help the less fortunate than they are spending on canned cheese. Whether this can make a difference, and whether they should be doing more, is a different story.