"When people get rich, they lose control of their preferences, substituting constructed preferences to their own, triggering their own misery. And these are the preferences of those who want to sell them something (a skin-in-the-game problem as their choices are dictated by others who have something to gain, and no side effects, from the sale).
I've mentioned here the following anecdote. I once had dinner in a Michelin-starred restaurant with a fellow who insisted on eating there instead of my selection of a casual Greek place. People in the restaurant were of the very constipated style, that kind of atmosphere. Dinner consisted in a succession of complicated small things. It felt like work. I left the place starving. Now if I had a choice I would have had some time-tested recipe (say a pizza with fresh ingredients, or a juicy hamburger) in a lively place--for a tenth of the price. But because the fellow could afford the expensive restaurant, we ended up the victims of some complicated experiments by a chef judged by some Michelin bureaucrat (one that would fail the Lindy effect[*], instead of eating some minute local variation around a progress through Sicilian grandmothers).
(Footnote: Hamburgers are tastier than filet mignon, because of the higher fat content, but people have been convinced that the latter is better because it is more expensive to produce).
The same with real estate. Most people, I am convinced, are happier in close quarters, in a real barrio-style neighborhood, where they can feel human warmth, but when they have big bucks they end up pressured to move into a humongous impersonal and silent mansions, far away from the neighbors. Not counting the fact that their house will be professionally managed like a corporation.
I am saying this because, with the passage [of] time, I am more and more convinced that very few people understand their own choices, and end up being manipulated by those who want to sell them something..."
Of course readers here at Casual Kitchen are well-familiarized with the idea that a simple, homemade recipe often satisfies far more than a costly, conspicuous consumption-type meal at an ultra-high-end restaurant. And it does so at a fraction of the cost.
Make that a tiny fraction of the cost.
Note also that "constructed preferences" affect people at all levels of wealth, not just "the rich." Wherever you happen to be on the income or socioeconomic spectrum, and with almost everything you buy, various constructed preferences await you, all thought up by marketing experts who "segment" their marketplace, lumping you into various euphemistically described consumer types (e.g.: value buyers, luxury buyers, conscientious buyers, and so on).
Not to mention: a member of any socioeconomic class living here in the USA is by definition among "the rich" in the context of global living standards. But sadly, thanks to our culture of consumerism and other Veblen-esque acts of socially competitive signalling, even objectively wealthy people here in the USA don't feel rich at all. That’s yet another deeply ironic aspect of the system Taleb describes.
The irony gets still deeper. If we aren’t truly mindful about what we’re really buying with our money, we create more and more economic waste the more we spend. We allow price, branding and other cues to signal quality for us, and we instinctively believe that branded or higher cost products offer more value when they almost never do. Things like the Diderot Effect come into play, where an "upgrade" in one area of our lives inevitably results in costly upgrades in other areas of our lives. Thus we confuse branding and other peoples’ preferences with what we truly value. Many consumers do this constantly, inevitably, without questioning or even realizing it.
One last point. For many people, and particularly for highly consumerist people, Taleb's quote above simply does not compute. They'll spontaneously reject his entire line of thinking. Why? Because no one likes to think they aren't thinking for themselves.
Read Next: Lessons Learned From a Bathroom Renovation
For further reading: I owe a great debt of gratitude to Taleb and his books The Black Swan,
Fooled by Randomness
and Antifragile,
all of which radically reshaped how I think. I recommend all three to any open-minded and intellectually curious reader. * The Lindy Effect: the idea that the longer something lasts, the longer it will continue to last. Pertains generally to ideas, products, technologies, cultural traditions, institutions, etc. (and not to living beings or people, obviously).
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