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Continuing the analysis of the Yahoo! Finance article 21 Ways Rich People Think Differenly, a condensed “interview” with Steve Siebold, author of How Rich People Think.

5. Average people long for the good old days. Rich people dream of the future.

“Self-made millionaires get rich because they’re willing to bet on themselves and project their dreams, goals and ideas into an unknown future,” Siebold writes.

“People who believe their best days are behind them rarely get rich, and often struggle with unhappiness and depression.”

Well . . . honestly, who can disagree with that?

I mean, it makes sense, right? If you’re always looking backward, you can’t move forward. If you take risks, the rewards can be commensurately better. It’s just common sense. Right?

Common sense, yes, but set up in such a way as to gloss over some fairly important details and lead the reader to a false conclusion.

To being with, Siebold presents the usual false dichotomy (which he’s been doing from the beginning, and continues to do throughout) of “Average” = looking backward vs. “Rich” = looking forward in such a way that each statement strongly implies it’s converse, but he doesn’t actually come out and say the converse statement, because doing so would immediately expose the fallacy. If he actually said the following:

1) Self-made millionaires look to the future and take risks;
2) People who look to the future and take risks are (or will be) self-made millionaires

the readers would pretty quickly figure out that he’s stating a falsehood. But by leaving statement #2 unspoken, he leaves the reader to fill in the blanks, whether they know they are doing so or not. This is two logical fallacies in one: affirming the consequent (If A then B; therefore, if B then A) and hasty generalization (this instance of A is B; therefore, all A are B).

The second statement (“People who believe their best days are behind them . . .”) is yet a third logical fallacy, cum hoc, also known as the “correlation equals causation” fallacy. He states it in such a way as to strongly imply that “not getting rich” is caused by “believing one’s best days are behind one”, when in fact the two may correlate for completely different reasons.

All of this is for the purpose of leading the reader into making a fourth logical fallacy, the sweeping generalization, in which a broad generalization (whether true or not) is applied to a case which, because of its specific circumstances, may be exempt from the generalization. Specifically, he leads the reader into thinking:

1) People who take risks and look to the future become self-made millionaires;
2) If I take risks and look to the future, I will become a self-made millionaire

when in fact there may be (and usually are) many other factors involved.

Now, one might argue that these “other factors” are the other “ways” that Mr. Siebold talks about in this article, and, as far as Siebold’s intent in concerned, you’d likely be right. But this particular “way” is really a microcosm of the entire article, which is a series of logical fallacies intended to lead the reader into committing fallacies of their own; specifically, “If I do all of the things Siebold says rich people do, I will become rich.” While it may be true that doing so will increase one’s overall odds at making oneself rich (because success does in fact require effort), what he doesn’t say is that it’s a matter of going from “no chance” to “a small chance”.

Tomorrow, I’ll look at more sweeping generalizations, why they may be true, and how it doesn’t really matter anyway.


Previously in this series: Prelude and Introduction | Part 1 | Part 2 | Part 3 | Part 4


( 5 comments — Leave a comment )
Sep. 11th, 2012 01:10 pm (UTC)
You'll probably be getting into this during the course of your series, but one of the biggest flaws I see in the article is that Siebold interchangeably refers to "The Rich" and "Self-Made Millionaires" as if they were the same thing, implying that ALL wealthy people earned their own fortunes. Which is simply not true, as you and I discussed earlier.
Sep. 11th, 2012 01:16 pm (UTC)
Yeah, that conflation occurs a lot, which is another example of affirming the consequent: All self-made millionaires are rich, therefore all rich people are self-made millionaires.
Sep. 11th, 2012 06:19 pm (UTC)
I commented on that in installment 1. Self-made millionaires tend to be more gracious than those who started rich and just got richer. Elizabeth Warren started out poor and made good. Mitt Romney started out rich and got richer.
Sep. 11th, 2012 06:24 pm (UTC)
And there ya go. Although that doesn't always hold. Steve Jobs started out dirt poor and turned into a ruthless rich guy. Warren Buffet started out rich, but is surprisingly egalitarian for a billionaire.
Sep. 11th, 2012 10:33 pm (UTC)
*bwah ha ha sob*

And this is why so many rich republicans want to turn the calendar back to the bad old days of no unions, only white people voting, womens' sexuality existing solely for the benefit of men, and so on?

(You knew somebody was going to say it...)
( 5 comments — Leave a comment )

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