The Jewish super-success in America

An Indian living in the West writes:

Jews and part-Jews make up 36 percent of the Forbes list of the 400 wealthiest Americans. If that is not utterly incredible I don’t know what is. Thirty-six percent of the billionaires from an ethnic group that is two percent of the U.S. population.

This cannot be explained by IQ alone. There is more to it than that—ambition, drive, hard work, brains, education, perseverance. It is almost as though the legendary Jewish business acumen found its best haven when it arrived in America. Where else could Jews thrive so well?

LA replies:

I’m probably the least affluent Jew you know.

ILW replies:

Don’t worry about that! You have some company. I have a few Jewish friends who have spent their life “in the pursuit of knowledge” as they call it.

Of course not all Jews are rich in the same way that not all Indian Parsis are rich. Individual differences do count for something.

ILW continues:
Here’s another anomaly: the under-representation of Indians and East Asians in the list. In the initial stages, at least, the first Indian immigrants to America were very intelligent—they were the cream of the scientific crop in India. Many went on to work for NASA (which at one time was filled with Indians). The East Asians may not have been highly selected for high IQ but they were the more intelligent part of their high IQ population in their country of origin.

So, clearly, IQ doesn’t do it all by itself. You need more. I think the biggest difference I have seen between Jews and non-Jews is the attitude to risk-taking. Jews will go off and take the kinds of risks that most Indians would consider insane. I think fear and shame of failure dominate the minds of Indians far too much, as also does the desire to remain “respectable” within their middle class milieu even if this comes at the cost of hyper-success.

The only people I know that are as comfortable with risk-taking as Jews are the white Texans (perhaps my views here are skewed by my own personal experiences). Texans (and Oklahomans) seem to have this inherited “wildcatter” gene that drives them to take utterly insane risks. But on an average their IQs are not as high than those of Ashkenazi Jews and so they are not as vastly over-represented in the ranks of the hyper-successful.

If I had to draw the distinction between Jews and white Texans/Oklahomans, it would be this: the Jews are calculated sharp risk takers whereas the Texans and the Oklahomans are often out and out gamblers. The opposite of that in Europe would be Germans—method and discipline overpowers everything. Risk and gambling are to be avoided like the plague.

LA replies:

That’s interesting about risk-taking. What that means in my mind is, you go out on a limb, you do something that isn’t correct according to established ways of doing things—something that you realize in advance is going to present further problems, perhaps unpredictable problems. But somehow you have the confidence that whatever problem does appear, you are going to be able to find a solution to it or work your way around it—and, most of the time, you do.

And not only that, but the fact of making mistakes and running into problems, and then finding solutions to them, makes the final result better than it would have been had the mistake or problem never occurred.

Sage McLaughlin writes:

Your post on Jewish affluence in America got me to thinking about something about my own family. Your correspondent ILW really is onto something about the Jews—it’s definitely more than just a raw IQ thing, or at least my own personal experience would seem to suggest as much.

As you know, my father was an Irish Catholic and my mother was an Ashkenazi Jew. They had two sons, my older brother being the middle child. Now, even though he inherited my father’s name, there is no question he also inherited my mother’s “Jewish temperament.” He is probably a bit above average in IQ, but not obviously brilliant. I, on the other hand, definitely inherited my father’s Irish temperament—moody, cantankerous, impractical, and all the rest. Still, while people have always remarked on my intelligence, my brother finished college at a much younger age than I did and never really had a rebellious or self-destructive phase, as I had.

Guess which one of us is a millionaire? Him, of course. My brother’s most valuable trait is not really his IQ, though you do have to be reasonably sharp to do what he does. What he has in spades is a remarkable natural instinct for thrift, hard work, dependability (he held the same job, as a cashier at a grocery store walking distance from our suburban home, from the time he was old enough to work until he finished college), and common sense in handling his financial affairs. Practically everything he touches turns to gold, and everyone who knows him has commented on how easily it appears to come to him—he seems to have been born just “knowing” how to turn himself into a financially successful man. I have the more gregarious personality (!), but he has a natural air of responsibility about him, which was evident from the time we were very young. Meanwhile, it will be a miracle if I am ever affluent enough even to get so much as a new car loan.

Now, I don’t know very many family members on my Jewish side—they shunned my siblings and me with an almost impressive unanimity. I do know, though, that most of them are entrepreneurs of some means, one cousin being a bona fide Jewish brain surgeon in New York. Are they all really high-IQ types? Probably not, but I doubt many of them are stupid and I’d bet even more that they’re all more like my brother than they are like me.

ILW writes:

You wrote:

That’s interesting about risk-taking. What that means in my mind is, you go out on a limb, you do something that isn’t correct according to established ways of doing things—something that you realize in advance is going to present further problems, perhaps unpredictable problems. But somehow you have the confidence that whatever problem does appear, you are going to be able to find a solution to it or work your way around it—and, most of the time, you do.

Yeah you’ve said it. That is the heart of it and that’s all there is. All risk involves a leap into the unknown. It means plunging into something that does not represent the tried and tested path, which is already crammed with half the world’s risk-avoiders. The issue then is what type of personality is willing to take the risk. The personality that is terrified of failure or concerned with any shame connected with failure cannot take it, or will not be able to sustain it to really pull it off.

So with Jews, there is an inherent self-belief that the risks they take can be controlled and calculated with some degree of precision. This is why Hedge Funds are totally dominated by Jews as this requires super-high mathematical ability to be able to control the outcome while maximizing profit. Wildcatting, on the other hand, is a total gamble. No one can possibly know what lies underground (this was before 3D seismic technology allowed oil prospectors to find oil deposits miles beneath the surface of the ocean). The Texans and the Oklahomans dominated wildcatting as they were not ashamed of total failure. To them life and business was a high risk poker game in which the worst that could happen to you is that you lost your shirt but not your life. You lose your shirt and start all over again and play to win. To my knowledge, this kind of wildcatting attitude is hard to find in Asia (except probably among the Chinese who are addictive gamblers). [LA replies: This reminds me of the James Garner Texas oil-man character in the 1963 movie The Wheeler Dealers, who says, “This isn’t about money—money is just the way you keep score!” And guess what—Garner was born in Oklahoma. Also he first became a star in the TV series Maverick in which he played a gambler.]

The Europeans are generally not good risk-takers. The best risk takers I know of among the Europeans are actually Greeks. But on the whole, their attitude to risk is more of total avoidance and the Germans are probably the most determined risk-avoiders you will find. I have always found the contrast between Americans and Europeans fascinating for this reason. Americans, as a whole, have a much greater appetite and willingness to take risks and are less afraid of failure. And among Americans, certain ethnicities come out on top when it comes to risk-taking.

Speaking of the gamblers of Texas and Oklahoma, here are two recent good examples well known to investors on Wall Street:

Aubrey McClendon

T Boone Pickens

With both of these men, all I have heard are stories. But they are really incredible. In early 2000, Pickens took a series of gambles on natural gas prices that would have frozen my blood had I been speculating with my own money. McClendon has also taken all kinds of wild risks and pulled them off. While most people should never ever try to emulate these men (the law of probabilities almost certainly guarantees failure), their presence is what makes life colourful and amusing as well. And you are unlikely to find men like them almost anywhere in Western Europe.

Jeremy G. writes:

I live near a rural fundamentalist Christian community (comprised mostly of northern Europeans) and travel regularly with my family to Ultra-Orthodox Jewish communities for Jewish holidays (I am Jewish). I was just commenting to a friend the other day how my three children have difficulty sitting still, whereas most of the children of my Christian friends can sit quietly for long periods of time. It’s not just my children. When I go to shul in Ultra-Orthodox neighborhoods, the other Jewish children can’t sit still either and are commonly running around, into and out of the prayer room. In contrast, every time I go to a Church to visit with friends, their children are all sitting peacefully in a neat row, listening quietly to the sermon. There is clearly a large difference in energy level and temperament between these two white groups.

LA replies:

I don’t think this is a good example of the point being discussed. Children naturally don’t want to sit still, especially during long uneventful activities done by adults, but want to run around. They have to be trained by their parents and other adults to sit quietly. I would say that the different behaviors of the Jewish children and Christian children you are describing are more a result of parental and social expectations and training, than of the children’s in-born genetic traits.

In my neighborhood in the upper West Side of Manhattan, you’ll commonly see a mother walk into a restaurant with her small children, and the children running ahead of her and making a disturbance, which the mother doesn’t mind at all. Or you’ll see a father walking on the sidewalk with his small children, and the children are jumping up and down maniacally and getting in the way of other adults, and the father doesn’t stop them. This disgusting parental conduct is true of all white parents in my neighborhood, not just Jews. These parental expectations are a function of white liberalism. The expected, and indeed, actively encouraged, behavior of small children in white liberal precincts is that they constantly jump around, so as to express their “creativity” and be “free” and not be repressed. It’s not about Jewish as compared with gentile. It’s about the norms of white liberals.

(However, I would have to add that this objectionable behavior pattern, after running rife for some years, seems to have declined somewhat in the last couple of years. Maybe it got so obnoxious, and the parents got so many complaints, that the parents realized that having their children running and jumping all over the place was not so cool. But that too was a cultural change, not something stemming from genes.)

LA continues:

A personal observation: When I used to attend conservative conferences regularly, I found it unbearable to sit through an entire session. So I would walk to the back of the conference hall and stand during the speeches.

ILW writes:

Here’s an interesting thing about personality: I spent a few days in Vegas three years ago. It was my first ever trip to Vegas, which is still the unquestionable gambling capital of the world. In my three day stay there I never gambled even once. It wasn’t that I was not willing to take risks but to me the risks were not controllable. There was too much luck involved. I say this as someone who has speculated on all sorts of things from lean hog prices to currencies to stocks. To me, speculation in the markets involved some hard analysis and the ability to calculate the risk with some degree of certainty. This meant greatly reducing the risk of failure and being able to predict success with some certainty. In that respect, you could say that I am more Jewish within the risk/spectrum rather than the Texan/Chinese gambler type.

For me the slot machines, the poker/black jack tables were not interesting. I did not even put a single coin into the slot machine in the entire three days that I was there. I was fascinated by all the gamblers throwing money at the tables knowing that the odds were stacked against them. That is something I could never do. Some of the businessmen I met there could not get themselves away from the tables. To me, they were an amusing distraction but nothing that could really entice me to take a punt.

Jeremy G. writes:

Thanks. That’s an interesting point. It may be less about in-born differences than parental expectations, as you say. However, in my example I was referring to Ultra-Orthodox Jews and their children. They are raising their children to conform to biblical standards of behavior, not to liberal standards. So the constant jumping around and even fighting with siblings is not desired by the parents. Perhaps the Christians are more successful at controlling their children because they are more comfortable using physical force, which religious Jews generally don’t use except in rare cases. I don’t know. The different behavior between the children of Jews and Christians just seems so striking to me, but I suppose it could be entirely a factor of parenting.

LA replies:

Obviously I didn’t mean to suggest that the ultra orthodox are conforming to liberal standards. I meant that, for whatever reason, the Jews are ok with their children running around and don’t train them not to behave that way.

But I suppose that your suggestion is also possibly true, that the Jewish parents do want their children to sit still, and they just can’t succeed in making them do that. But I doubt that. In every culture, small children behave the way their parents expect and require them to behave.

ILW replies to LA:

Yes, James Garner’s character sounds like your stereotypical Texas/Oklahoma character. The region is filled with such types, or so my few Texan acquaintances tell me.

This tradition goes back a lot further than the Texas oil boom (which started in the early 20th century). Texas was ruined during the Civil War and life had to begin anew. The Texas cattlemen rode enormous distances with their herds to sell their livestock to beef-starved northern factory workers after the Civil War. These journeys were immortalised in numerous Westerns including, most famously, John Wayne’s Red River. [LA replies: More accurately, they drove the cattle enormous distances to get them on trains heading for northern cities.]

Those cattlemen were gamblers (though not just that because cattle ranching was a hard job physically and very demanding). The gamble was taking everything you had on a dangerous trail likely to be attacked by dangerous renegades or Red Indians. I think that the gambling tradition got well entrenched in Texas as a result of this. When the oil boom arrived, the Texans took to it like fish take to water. There are some very colourful stories from the Texas oil booms of the early 20th century, most famously those involving a certain H.L.Hunt (and his lunatic sons who tried to corner the entire global supply of silver—who but a Texan would attempt something that crazy? A Jew maybe? Marc Rich tried to corner the global Zinc market ten years later).

Posted by Lawrence Auster at July 16, 2012 02:21 PM | Send

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