Readers Sound Off on Luck vs. Skill in Business and Investing
I’ve spent the last several columns discussing New York Times columnist Robert Frank’s provocative thesis about the myth of the meritocracy.
He claims that if your income and net worth put you in the top 1% or 2% in the country, the deciding factor was not talent, education, hard work, risk-taking, persistence, resilience or all of the above.
In the end, it boils down to luck, plain and simple.
He argues that there are millions of talented and hardworking people who never achieve any great economic success - and the deciding factor, in his view, is simply fortunate (or unfortunate) personal circumstances and breaks.
I disagree with this analysis, as well as his call for a highly progressive consumption tax on the “undeserving” rich.
But I’ve sounded off on this topic long enough. Today, I want to share a few thought-provoking responses from readers.
Some of you agreed, at least partially, with Mr. Frank.
George Buranyi commented...
It is humbling to admit that surrounding us there are any number of people who could contribute as well as we have. Science is filled with examples of someone becoming famous by being weeks or months ahead of equally talented people who sometimes are just footnotes in history because they did not get to press or the last critical experiment was run late.
That’s true, of course, and I noted throughout the series that not everyone’s success is due to talent and hard work alone.
Steve Chapman chimed in...
Clearly, to improve your chances of success in life, you should work hard, try to make educated decisions, etc. But how many people do you know who work hard and make educated decisions do OK but don't hit it big? I think what [Mr. Frank] is saying is that you have to do all those things AND get lucky to be fantastically successful.
That’s also no doubt true in some cases. However, most respondents disagreed with Mr. Frank’s thesis.
Rupert MacLean wrote...
In my view, there are four elements to success: A. The opportunity must present itself. B. Someone must recognize that opportunity. C. That same person must be qualified to take advantage of the opportunity. D. That same person must have the courage and intestinal fortitude to act on the opportunity.
Indeed. As Louis Pasteur noted more than a century ago, “Chance favors the prepared mind.”
William R. Smith said...
I am a retired practicing lawyer (45 years), and I agree with you. Most of my successful clients/wealthy clients worked their butts off, took risks, and succeeded only because of their efforts; some to the detriment of their families because they were at ‘work’ so much.
James Burton pointed out that Mr. Frank has an agenda, soaking the rich:
This is how success is framed by progressives. They refer to people who have built strong businesses and considerable wealth as society's lottery winners. All credit for success is because of the sweet spot they were born into and has nothing to do with hard work. That thinking makes it an easier argument to say they owe a greater amount of wealth to society, as it is society that made all success possible.
And, finally, Michael Churchman shared this message:
Mr. Frank has a lot to learn. I was raised in virtual poverty by hardworking parents. I worked my way through engineering school and entered the workforce. While all my co-workers went on and on about wanting to start their own businesses, I quit and did it. Being a white male in the ‘70s, the SBA had no programs to help me out.
Financing anything was impossible. I started with real estate, leveraging one purchase into three and doing all the repairs/remodeling myself. Using these funds for startup created a business with 26 employees; then everything was lost to a devastating fire (yes it was arson, could not prove it was one of my people).
Starting again with a negative $250,000 (at 17% interest) was not easy, but I bootstrapped my next business into a multimillion-dollar company (profits, not gross sales); again with no financial support/aid.
I worked for my education. I personally overcame great odds and adversity. I paid for everything and never left a creditor hanging. After becoming successful, I was graced with all the comments on how I was lucky because I had money! Banks that turned me down repeatedly when I needed help now came offering to show me how to invest my money.
Excuses are many for the failure to succeed, but that is what they are: excuses. Some actually have reasons, but I am here to tell you that you can start with nothing and become successful. I did it with no advantages; so can you. It will not, however, come free. One has to make an effort and a commitment to move forward.
Kudos to you, Mr. Churchman, for sharing your personal story.
Feel free to continue sounding off below. And, in case you were wondering, the most common response from readers was the oldest chestnut of all:
“Yes, it’s all about luck. And the harder I work, the luckier I get.”
Thoughts on this article? Leave a comment below.