This weekend former hedge fund trader-turned-philanthropist Sam Polk wrote an op-ed in The New York Times that simply explains Wall Street’s problem with “wealth addiction.”
You may be more familiar with the term more commonly used for it — greed.
What’s interesting about Polk’s column isn’t that he grew up living paycheck to paycheck, made his way through Columbia while wrestling with an addiction to drugs and alcohol, or lied his way onto Wall Street.
What is interesting about the column is that he understands that Wall Street’s problem with money is tied to a very well-known, innate human desire — the desire to feel powerful (from the NYT):
I felt so important. At 25, I could go to any restaurant in Manhattan — Per Se, Le Bernardin — just by picking up the phone and calling one of my brokers, who ingratiate themselves to traders by entertaining with unlimited expense accounts. I could be second row at the Knicks-Lakers game just by hinting to a broker I might be interested in going. The satisfaction wasn’t just about the money. It was about the power. Because of how smart and successful I was, it was someone else’s job to make me happy.
Still, I was nagged by envy. On a trading desk everyone sits together, from interns to managing directors. When the guy next to you makes $10 million, $1 million or $2 million doesn’t look so sweet. Nonetheless, I was thrilled with my progress.
The same way politicians use favors, or media moguls use their voice to hold sway, Wall Streeters use money to shape the world in their image, to swing fate in their favor.
On Wall Street though, as Polk points out, the junior guys get a significant piece too. It wraps them in and makes them want more.
That piece takes away from the larger pie, not that Polk’s peers wanted to admit that. Any tiny attack, any suggestion that taxes should be raised, bonuses should be cut, that what was happening was unfair, was an attack on every individual’s power and the power of the institutions that supported them.
But in the end, it was actually my absurdly wealthy bosses who helped me see the limitations of unlimited wealth. I was in a meeting with one of them, and a few other traders, and they were talking about the new hedge-fund regulations. Most everyone on Wall Street thought they were a bad idea. “But isn’t it better for the system as a whole?” I asked. The room went quiet, and my boss shot me a withering look. I remember his saying, “I don’t have the brain capacity to think about the system as a whole. All I’m concerned with is how this affects our company.”
And of course, this elevation of the company or the individual over the wider system had to be rationalized. That is why, before coming to the realization that he was a wealth addict, Polk told himself that he was smarter, that he worked harder, and that he and his peers deserved the massive pieces of the pie they were taking.
They believed that their appetite was appropriate.
Polk’s therapist told him that, as a college student, he had been using drugs and alcohol to cope with his powerlessness. As an adult, he used money to banish it all together. It was this understanding that gave him the strength to leave the Street.
None of this is to say that every Wall Streeter is a wealth addict. Polk wrote that if you have millions, and you think you have enough, you’re likely not an addict.
But if you have enough, and you believe you deserve more — that you deserve it more than other professions like nurses, or doctors, or other people whose purpose in society is very clear — you likely have a problem with greed.
And admitting the problem is the first step to recovery.