Re-thinking Wealth in the 21st-Century Economy
What is the future of wealth and prosperity in the 21st century? Earlier this month, Washington took the country over the so called “fiscal cliff” and back. Despite their retroactive resolution the debate over income inequality, tax revenue, spending cuts, and job growth (all of which deal with our current concepts about wealth, currency, entitlements, and “fairness”) rages on. These debates stem from a larger problem that is not being addressed at the highest levels of leadership in our country. That problem is our collective mental model of wealth. We have very specific biases and assumptions about the way the world works, the way our economy works, and what is fair and unfair. The underlying premise of that mental model is unlimited growth, unlimited resources, and unlimited opportunity. However, we live in a finite world with limited resources, limiting growth and opportunity [within our current framework]. The irony here is that our concept of limitations are limited to the framework we place them in. So yes, in today’s economic paradigm we are limited in what we can actually do and acquire. As a result, we continue to struggle through a downward economy because we are focusing on yesterday’s standards of prosperity, which define wealth by the acquisition of currency, property, power, etc. So how do we shift our mental model to embrace new concepts of wealth?
We must start by understanding that the definition and perception of wealth will almost certainly be different in the future. Imagine your mental models, your biases and assumptions about wealth, as a portfolio of sorts. When we invest in the stock market or put money into retirement plans, the best advice is always to spread the risk among different investments, which in turn creates a diversified portfolio. Just as in nature, diversification helps to insure longevity and resilience in the face of adversity.
The same principle of diversification must be applied to our overall concept of prosperity. By doing so we begin to uncover hidden wealth, new forms of value, and new opportunities to grow and become more fulfilled in business and in our personal lives. Uncovering hidden wealth involves finding monetary value in diverse abstract concepts such as quality, creativity, and sustainability. You may be thinking, “That’s great Jared, but quality, creativity, and sustainability, won’t pay my mortgage or make payroll this month.” I wholeheartedly agree. However, just as we make investments to increase our long-term wealth in our current economic system, we must also begin to invest in the qualities to create a new sustainable economic infrastructure. This is the process of thinking long-term. We must begin to rethink growth, value, and wealth in order to make the right investments today that will ensure a prosperous and valuable future.