During the last year, I have spent a considerable amount of time in
An order of magnitude is a multiple of 10. In this case, an order of magnitude more than $41,000 is $410,000. Ten people working at $41K earn as much as one working at $410K. Alternatively, one person working for ten years at $41K earns what another working at $410K earns in one.
I recently was at a meeting at Harvard and visited some students in the business school there. One of the students told me of a potential job offer with a private equity firm where the starting compensation package was approximately $410,000. It was pure coincidence that the offer was exactly an order of magnitude more than the one I had been offered to teach. In the face of the magnitude all I could say was, “wow!”.
I wonder about the implications of such a difference, about an order of magnitude difference between financial management and teaching young people. In the most simple comparison, if two people at these respective salaries work for five years, one will have amassed nearly $2.5 million and the other just shy of $250,000. Let me write those numbers: two million four hundred sixty thousand dollars versus two hundred forty six thousand dollars over five years.
What is really happening that can create such an enormous difference? Since when is financial planning and the buying and selling of companies so astronomically more important than everything else? If we dig beneath the standard arguments in support of the free market and its aggressive promotion of individualism, what does this order of magnitude really say about our collective instincts? In many ways the occupations dealing with social justice and education and the laying of hands on people are so devalued monetarily that they appear almost trivial, a wasteland for the less talented. Why must wanting to make an immediate difference in someone’s life require an almost cherubic sacrifice in your own?
A teacher holds on to a young person, looks at them in their eyes and battles with them day in and day out to ensure that they learn, that they grow, that they can comprehend the system into which they are born. In many ways they serve as guards protecting young people from the darkness of ignorance. How do we really say that that activity is on par, in terms of money, with picking up garbage? Indeed, that it is ten times less valuable than a financial modeler? Ten times?
Clearly I am biased on the side of social justice, education and personal contact. Having said that, I do not underestimate the significance of a viable business class and sound financial markets. I am baffled though, by a whole order of magnitude.