May 2004When people care enough about something to do it well, those whodo it best tend to be far better than everyone else. There's ahuge gap between Leonardo and second-rate contemporaries likeBorgognone. You see the same gap between Raymond Chandler and theaverage writer of detective novels. A top-ranked professional chessplayer could play ten thousand games against an ordinary club playerwithout losing once.Like chess or painting or writing novels, making money is a veryspecialized skill. But for some reason we treat this skilldifferently. No one complains when a few people surpass all therest at playing chess or writing novels, but when a few people makemore money than the rest, we get editorials saying this is wrong.Why? The pattern of variation seems no different than for any otherskill. What causes people to react so strongly when the skill ismaking money?I think there are three reasons we treat making money as different:the misleading model of wealth we learn as children; the disreputableway in which, till recently, most fortunes were accumulated; andthe worry that great variations in income are somehow bad forsociety. As far as I can tell, the first is mistaken, the secondoutdated, and the third empirically false. Could it be that, in amodern democracy, variation in income is actually a sign of health?The Daddy Model of WealthWhen I was five I thought electricity was created by electricsockets. I didn't realize there were power plants out theregenerating it. Likewise, it doesn't occur to most kids that wealthis something that has to be generated. It seems to be somethingthat flows from parents.Because of the circumstances in which they encounter it, childrentend to misunderstand wealth. They confuse it with money. Theythink that there is a fixed amount of it. And they think of it assomething that's distributed by authorities (and so should bedistributed equally), rather than something that has to be created(and might be created unequally).In fact, wealth is not money. Money is just a convenient way oftrading one form of wealth for another. Wealth is the underlyingstuff—the goods and services we buy. When you travel to arich or poor country, you don't have to look at people's bankaccounts to tell which kind you're in. You can seewealth—in buildings and streets, in the clothes and the healthof the people.Where does wealth come from? People make it. This was easier tograsp when most people lived on farms, and made many of the thingsthey wanted with their own hands. Then you could see in the house,the herds, and the granary the wealth that each family created. Itwas obvious then too that the wealth of the world was not a fixedquantity that had to be shared out, like slices of a pie. If youwanted more wealth, you could make it.This is just as true today, though few of us create wealth directlyfor ourselves (except for a few vestigial domestic tasks). Mostlywe create wealth for other people in exchange for money, which wethen trade for the forms of wealth we want. [1]Because kids are unable to create wealth, whatever they have hasto be given to them. And when wealth is something you're given,then of course it seems that it should be distributed equally.[2]As in most families it is. The kids see to that. "Unfair," theycry, when one sibling gets more than another.In the real world, you can't keep living off your parents. If youwant something, you either have to make it, or do something ofequivalent value for someone else, in order to get them to give youenough money to buy it. In the real world, wealth is (except fora few specialists like thieves and speculators) something you haveto create, not something that's distributed by Daddy. And sincethe ability and desire to create it vary from person to person,it's not made equally.You get paid by doing or making something people want, and thosewho make more money are often simply better at doing what peoplewant. Top actors make a lot more money than B-list actors. TheB-list actors might be almost as charismatic, but when people goto the theater and look at the list of movies playing, they wantthat extra oomph that the big stars have.Doing what people want is not the only way to get money, of course.You could also rob banks, or solicit bribes, or establish a monopoly.Such tricks account for some variation in wealth, and indeed forsome of the biggest individual fortunes, but they are not the rootcause of variation in income. The root cause of variation in income,as Occam's Razor implies, is the same as the root cause of variationin every other human skill.In the United States, the CEO of a large public company makes about100 times as much as the average person. [3]Basketball playersmake about 128 times as much, and baseball players 72 times as much.Editorials quote this kind of statistic with horror. But I haveno trouble imagining that one person could be 100 times as productiveas another. In ancient Rome the price of slaves varied bya factor of 50 depending on their skills. [4]And that's withoutconsidering motivation, or the extra leverage in productivity thatyou can get from modern technology.Editorials about athletes' or CEOs' salaries remind me of earlyChristian writers, arguing from first principles about whether theEarth was round, when they could just walk outside and check.[5]How much someone's work is worth is not a policy question. It'ssomething the market already determines."Are they really worth 100 of us?" editorialists ask. Depends onwhat you mean by worth. If you mean worth in the sense of whatpeople will pay for their skills, the answer is yes, apparently.A few CEOs' incomes reflect some kind of wrongdoing. But are therenot others whose incomes really do reflect the wealth they generate?Steve Jobs saved a company that was in a terminal decline. And notmerely in the way a turnaround specialist does, by cutting costs;he had to decide what Apple's next products should be. Few otherscould have done it. And regardless of the case with CEOs, it'shard to see how anyone could argue that the salaries of professionalbasketball players don't reflect supply and demand.It may seem unlikely in principle that one individual could reallygenerate so much more wealth than another. The key to this mysteryis to revisit that question, are they really worth 100 of us?Would a basketball team trade one of their players for 100random people? What would Apple's next product look like if youreplaced Steve Jobs with a committee of 100 random people? [6]Thesethings don't scale linearly. Perhaps the CEO or the professionalathlete has only ten times (whatever that means) the skill anddetermination of an ordinary person. But it makes all the differencethat it's concentrated in one individual.When we say that one kind of work is overpaid and another underpaid,what are we really saying? In a free market, prices are determinedby what buyers want. People like baseball more than poetry, sobaseball players make more than poets. To say that a certain kindof work is underpaid is thus identical with saying that people wantthe wrong things.Well, of course people want the wrong things. It seems odd to besurprised by that. And it seems even odder to say that it'sunjust that certain kinds of work are underpaid. [7]Thenyou're saying that it's unjust that people want the wrong things.It's lamentable that people prefer reality TV and corndogs toShakespeare and steamed vegetables, but unjust? That seems likesaying that blue is heavy, or that up is circular.The appearance of the word "unjust" here is the unmistakable spectralsignature of the Daddy Model. Why else would this idea occur inthis odd context? Whereas if the speaker were still operating onthe Daddy Model, and saw wealth as something that flowed from acommon source and had to be shared out, rather than somethinggenerated by doing what other people wanted, this is exactly whatyou'd get on noticing that some people made much more than others.When we talk about "unequal distribution of income," we shouldalso ask, where does that income come from?[8]Who made the wealthit represents? Because to the extent that income varies simplyaccording to how much wealth people create, the distribution maybe unequal, but it's hardly unjust.Stealing ItThe second reason we tend to find great disparities of wealthalarming is that for most of human history the usual way to accumulatea fortune was to steal it: in pastoral societies by cattle raiding;in agricultural societies by appropriating others' estates in timesof war, and taxing them in times of peace.In conflicts, those on the winning side would receive the estatesconfiscated from the losers. In England in the 1060s, when Williamthe Conqueror distributed the estates of the defeated Anglo-Saxonnobles to his followers, the conflict was military. By the 1530s,when Henry VIII distributed the estates of the monasteries to hisfollowers, it was mostly political. [9]But the principle was thesame. Indeed, the same principle is at work now in Zimbabwe.In more organized societies, like China, the ruler and his officialsused taxation instead of confiscation. But here too we see thesame principle: the way to get rich was not to create wealth, butto serve a ruler powerful enough to appropriate it.This started to change in Europe with the rise of the middle class.Now we think of the middle class as people who are neither rich norpoor, but originally they were a distinct group. In a feudalsociety, there are just two classes: a warrior aristocracy, and theserfs who work their estates. The middle class were a new, thirdgroup who lived in towns and supported themselves by manufacturingand trade.Starting in the tenth and eleventh centuries, petty nobles andformer serfs banded together in towns that gradually became powerfulenough to ignore the local feudal lords. [10]Like serfs, the middleclass made a living largely by creating wealth. (In port citieslike Genoa and Pisa, they also engaged in piracy.) But unlike serfsthey had an incentive to create a lot of it. Any wealth a serfcreated belonged to his master. There was not much point in makingmore than you could hide. Whereas the independence of the townsmenallowed them to keep whatever wealth they created.Once it became possible to get rich by creating wealth, society asa whole started to get richer very rapidly. Nearly everything wehave was created by the middle class. Indeed, the other two classeshave effectively disappeared in industrial societies, and theirnames been given to either end of the middle class. (In the originalsense of the word, Bill Gates is middle class.)But it was not till the Industrial Revolution that wealth creationdefinitively replaced corruption as the best way to get rich. InEngland, at least, corruption only became unfashionable (and infact only started to be called "corruption") when there started tobe other, faster ways to get rich.Seventeenth-century England was much like the third world today,in that government office was a recognized route to wealth. Thegreat fortunes of that time still derived more from what we wouldnow call corruption than from commerce. [11]By the nineteenthcentury that had changed. There continued to be bribes, as therestill are everywhere, but politics had by then been left to men whowere driven more by vanity than greed. Technology had made itpossible to create wealth faster than you could steal it. Theprototypical rich man of the nineteenth century was not a courtierbut an industrialist.With the rise of the middle class, wealth stopped being a zero-sumgame. Jobs and Wozniak didn't have to make us poor to make themselvesrich. Quite the opposite: they created things that made our livesmaterially richer. They had to, or we wouldn't have paid for them.But since for most of the world's history the main route to wealthwas to steal it, we tend to be suspicious of rich people. Idealisticundergraduates find their unconsciously preserved child's model ofwealth confirmed by eminent writers of the past. It is a case ofthe mistaken meeting the outdated."Behind every great fortune, there is a crime," Balzac wrote. Excepthe didn't. What he actually said was that a great fortune with noapparent cause was probably due to a crime well enough executedthat it had been forgotten. If we were talking about Europe in1000, or most of the third world today, the standard misquotationwould be spot on. But Balzac lived in nineteenth-century France,where the Industrial Revolution was well advanced. He knew youcould make a fortune without stealing it. After all, he did himself,as a popular novelist.[12]Only a few countries (by no coincidence, the richest ones) havereached this stage. In most, corruption still has the upper hand.In most, the fastest way to get wealth is by stealing it. And sowhen we see increasing differences in income in a rich country,there is a tendency to worry that it's sliding back toward becominganother Venezuela. I think the opposite is happening. I thinkyou're seeing a country a full step ahead of Venezuela.The Lever of TechnologyWill technology increase the gap between rich and poor? It willcertainly increase the gap between the productive and the unproductive.That's the whole point of technology. With a tractor an energeticfarmer could plow six times as much land in a day as he could witha team of horses. But only if he mastered a new kind of farming.I've seen the lever of technology grow visibly in my own time. Inhigh school I made money by mowing lawns and scooping ice cream atBaskin-Robbins. This was the only kind of work available at thetime. Now high school kids could write software or design websites. But only some of them will; the rest will still be scoopingice cream.I remember very vividly when in 1985 improved technology made itpossible for me to buy a computer of my own. Within months I wasusing it to make money as a freelance programmer. A few yearsbefore, I couldn't have done this. A few years before, there wasno such thing as a freelance programmer. But Apple createdwealth, in the form of powerful, inexpensive computers, and programmersimmediately set to work using it to create more.As this example suggests, the rate at which technology increasesour productive capacity is probably exponential, rather than linear.So we should expect to see ever-increasing variation in individualproductivity as time goes on. Will that increase the gap betweenrich and the poor? Depends which gap you mean.Technology should increase the gap in income, but it seems todecrease other gaps. A hundred years ago, the rich led a differentkind of life from ordinary people. They lived in housesfull of servants, wore elaborately uncomfortable clothes, andtravelled about in carriages drawn by teams of horses which themselvesrequired their own houses and servants. Now, thanks to technology,the rich live more like the average person.Cars are a good example of why. It's possible to buy expensive,handmade cars that cost hundreds of thousands of dollars. But thereis not much point. Companies make more money by building a largenumber of ordinary cars than a small number of expensive ones. Soa company making a mass-produced car can afford to spend a lot moreon its design. If you buy a custom-made car, something will alwaysbe breaking. The only point of buying one now is to advertise thatyou can.Or consider watches. Fifty years ago, by spending a lot of moneyon a watch you could get better performance. When watches hadmechanical movements, expensive watches kept better time. Not anymore. Since the invention of the quartz movement, an ordinary Timexis more accurate than a Patek Philippe costing hundreds of thousandsof dollars.[13]Indeed, as with expensive cars, if you're determinedto spend a lot of money on a watch, you have to put up with someinconvenience to do it: as well as keeping worse time, mechanicalwatches have to be wound.The only thing technology can't cheapen is brand. Which is preciselywhy we hear ever more about it. Brand is the residue left as thesubstantive differences between rich and poor evaporate. But whatlabel you have on your stuff is a much smaller matter than havingit versus not having it. In 1900, if you kept a carriage, no oneasked what year or brand it was. If you had one, you were rich.And if you weren't rich, you took the omnibus or walked. Now eventhe poorest Americans drive cars, and it is only because we're sowell trained by advertising that we can even recognize the especiallyexpensive ones.[14]The same pattern has played out in industry after industry. Ifthere is enough demand for something, technology will make it cheapenough to sell in large volumes, and the mass-produced versionswill be, if not better, at least more convenient.[15]And thereis nothing the rich like more than convenience. The rich people Iknow drive the same cars, wear the same clothes, have the same kindof furniture, and eat the same foods as my other friends. Theirhouses are in different neighborhoods, or if in the same neighborhoodare different sizes, but within them life is similar. The housesare made using the same construction techniques and contain muchthe same objects. It's inconvenient to do something expensive andcustom.The rich spend their time more like everyone else too. BertieWooster seems long gone. Now, most people who are rich enough notto work do anyway. It's not just social pressure that makes them;idleness is lonely and demoralizing.Nor do we have the social distinctions there were a hundred yearsago. The novels and etiquette manuals of that period read nowlike descriptions of some strange tribal society. "With respectto the continuance of friendships..." hints Mrs. Beeton's Bookof Household Management (1880), "it may be found necessary, insome cases, for a mistress to relinquish, on assuming the responsibilityof a household, many of those commenced in the earlier part of herlife." A woman who married a rich man was expected to drop friendswho didn't. You'd seem a barbarian if you behaved that way today.You'd also have a very boring life. People still tend to segregatethemselves somewhat, but much more on the basis of education thanwealth.[16]Materially and socially, technology seems to be decreasing the gapbetween the rich and the poor, not increasing it. If Lenin walkedaround the offices of a company like Yahoo or Intel or Cisco, he'dthink communism had won. Everyone would be wearing the same clothes,have the same kind of office (or rather, cubicle) with the samefurnishings, and address one another by their first names insteadof by honorifics. Everything would seem exactly as he'd predicted,until he looked at their bank accounts. Oops.Is it a problem if technology increases that gap? It doesn't seemto be so far. As it increases the gap in income, it seems todecrease most other gaps.Alternative to an AxiomOne often hears a policy criticized on the grounds that it wouldincrease the income gap between rich and poor. As if it were anaxiom that this would be bad. It might be true that increasedvariation in income would be bad, but I don't see how we can sayit's axiomatic.Indeed, it may even be false, in industrial democracies. In asociety of serfs and warlords, certainly, variation in income is asign of an underlying problem. But serfdom is not the only causeof variation in income. A 747 pilot doesn't make 40 times as muchas a checkout clerk because he is a warlord who somehow holds herin thrall. His skills are simply much more valuable.I'd like to propose an alternative idea: that in a modern society,increasing variation in income is a sign of health. Technologyseems to increase the variation in productivity at faster thanlinear rates. If we don't see corresponding variation in income,there are three possible explanations: (a) that technical innovationhas stopped, (b) that the people who would create the most wealtharen't doing it, or (c) that they aren't getting paid for it.I think we can safely say that (a) and (b) would be bad. If youdisagree, try living for a year using only the resources availableto the average Frankish nobleman in 800, and report back to us.(I'll be generous and not send you back to the stone age.)The only option, if you're going to have an increasingly prosperoussociety without increasing variation in income, seems to be (c),that people will create a lot of wealth without being paid for it.That Jobs and Wozniak, for example, will cheerfully work 20-hourdays to produce the Apple computer for a society that allows them,after taxes, to keep just enough of their income to match what theywould have made working 9 to 5 at a big company.Will people create wealth if they can't get paid for it? Only ifit's fun. People will write operating systems for free. But theywon't install them, or take support calls, or train customers touse them. And at least 90% of the work that even the highest techcompanies do is of this second, unedifying kind.All the unfun kinds of wealth creation slow dramatically in a societythat confiscates private fortunes. We can confirm this empirically.Suppose you hear a strange noise that you think may be due to anearby fan. You turn the fan off, and the noise stops. You turnthe fan back on, and the noise starts again. Off, quiet. On,noise. In the absence of other information, it would seem the noiseis caused by the fan.At various times and places in history, whether you could accumulatea fortune by creating wealth has been turned on and off. NorthernItaly in 800, off (warlords would steal it). Northern Italy in1100, on. Central France in 1100, off (still feudal). England in1800, on. England in 1974, off (98% tax on investment income).United States in 1974, on. We've even had a twin study: WestGermany, on; East Germany, off. In every case, the creation ofwealth seems to appear and disappear like the noise of a fan as youswitch on and off the prospect of keeping it.There is some momentum involved. It probably takes at least ageneration to turn people into East Germans (luckily for England).But if it were merely a fan we were studying, without all the extrabaggage that comes from the controversial topic of wealth, no onewould have any doubt that the fan was causing the noise.If you suppress variations in income, whether by stealing privatefortunes, as feudal rulers used to do, or by taxing them away, assome modern governments have done, the result always seems to bethe same. Society as a whole ends up poorer.If I had a choice of living in a society where I was materiallymuch better off than I am now, but was among the poorest, or in onewhere I was the richest, but much worse off than I am now, I'd takethe first option. If I had children, it would arguably be immoralnot to. It's absolute poverty you want to avoid, not relativepoverty. If, as the evidence so far implies, you have to have oneor the other in your society, take relative poverty.You need rich people in your society not so much because in spendingtheir money they create jobs, but because of what they have to doto get rich. I'm not talking about the trickle-down effecthere. I'm not saying that if you let Henry Ford get rich, he'llhire you as a waiter at his next party. I'm saying that he'll makeyou a tractor to replace your horse.Notes[1]Part of the reason this subject is so contentious is that someof those most vocal on the subject of wealth—universitystudents, heirs, professors, politicians, and journalists—havethe least experience creating it. (This phenomenon will be familiarto anyone who has overheard conversations about sports in a bar.)Students are mostly still on the parental dole, and have not stoppedto think about where that money comes from. Heirs will be on theparental dole for life. Professors and politicians live withinsocialist eddies of the economy, at one remove from the creationof wealth, and are paid a flat rate regardless of how hard theywork. And journalists as part of their professional code segregatethemselves from the revenue-collecting half of the businesses theywork for (the ad sales department). Many of these people nevercome face to face with the fact that the money they receive representswealth—wealth that, except in the case of journalists, someoneelse created earlier. They live in a world in which income isdoled out by a central authority according to some abstract notionof fairness (or randomly, in the case of heirs), rather than givenby other people in return for something they wanted, so it may seemto them unfair that things don't work the same in the rest of theeconomy.(Some professors do create a great deal of wealth forsociety. But the money they're paid isn't a quid pro quo.It's more in the nature of an investment.)[2]When one reads about the origins of the Fabian Society, itsounds like something cooked up by the high-minded Edwardianchild-heroes of Edith Nesbit's The Wouldbegoods.[3]According to a study by the Corporate Library, the median totalcompensation, including salary, bonus, stock grants, and the exerciseof stock options, of S&P 500 CEOs in 2002 was $3.65 million.According to Sports Illustrated, the average NBA player'ssalary during the 2002-03 season was $4.54 million, and the averagemajor league baseball player's salary at the start of the 2003season was $2.56 million. According to the Bureau of LaborStatistics, the mean annual wage in the US in 2002 was $35,560.[4]In the early empire the price of an ordinary adult slave seemsto have been about 2,000 sestertii (e.g. Horace, Sat. ii.7.43).A servant girl cost 600 (Martial vi.66), while Columella (iii.3.8)says that a skilled vine-dresser was worth 8,000. A doctor, P.Decimus Eros Merula, paid 50,000 sestertii for his freedom (Dessau,Inscriptiones 7812). Seneca (Ep. xxvii.7) reportsthat one Calvisius Sabinus paid 100,000 sestertii apiece for slaveslearned in the Greek classics. Pliny (Hist. Nat. vii.39)says that the highest price paid for a slave up to his time was700,000 sestertii, for the linguist (and presumably teacher) Daphnis,but that this had since been exceeded by actors buying their ownfreedom.Classical Athens saw a similar variation in prices. An ordinarylaborer was worth about 125 to 150 drachmae. Xenophon (Mem.ii.5) mentions prices ranging from 50 to 6,000 drachmae (for themanager of a silver mine).For more on the economics of ancient slavery see:Jones, A. H. M., "Slavery in the Ancient World," Economic HistoryReview, 2:9 (1956), 185-199, reprinted in Finley, M. I. (ed.),Slavery in Classical Antiquity, Heffer, 1964.[5]Eratosthenes (276—195 BC) used shadow lengths in differentcities to estimate the Earth's circumference. He was off by onlyabout 2%.[6]No, and Windows, respectively.[7]One of the biggest divergences between the Daddy Model andreality is the valuation of hard work. In the Daddy Model, hardwork is in itself deserving. In reality, wealth is measured bywhat one delivers, not how much effort it costs. If I paint someone'shouse, the owner shouldn't pay me extra for doing it with a toothbrush.It will seem to someone still implicitly operating on the DaddyModel that it is unfair when someone works hard and doesn't getpaid much. To help clarify the matter, get rid of everyone elseand put our worker on a desert island, hunting and gathering fruit.If he's bad at it he'll work very hard and not end up with muchfood. Is this unfair? Who is being unfair to him?[8]Part of the reason for the tenacity of the Daddy Model may bethe dual meaning of "distribution." When economists talk about"distribution of income," they mean statistical distribution. Butwhen you use the phrase frequently, you can't help associating itwith the other sense of the word (as in e.g. "distribution of alms"),and thereby subconsciously seeing wealth as something that flowsfrom some central tap. The word "regressive" as applied to taxrates has a similar effect, at least on me; how can anythingregressive be good?[9]"From the beginning of the reign Thomas Lord Roos was an assiduouscourtier of the young Henry VIII and was soon to reap the rewards.In 1525 he was made a Knight of the Garter and given the Earldomof Rutland. In the thirties his support of the breach with Rome,his zeal in crushing the Pilgrimage of Grace, and his readiness tovote the death-penalty in the succession of spectacular treasontrials that punctuated Henry's erratic matrimonial progress madehim an obvious candidate for grants of monastic property."Stone, Lawrence, Family and Fortune: Studies in AristocraticFinance in the Sixteenth and Seventeenth Centuries, OxfordUniversity Press, 1973, p. 166.[10]There is archaeological evidence for large settlements earlier,but it's hard to say what was happening in them.Hodges, Richard and David Whitehouse, Mohammed, Charlemagne andthe Origins of Europe, Cornell University Press, 1983.[11]William Cecil and his son Robert were each in turn the mostpowerful minister of the crown, and both used their position toamass fortunes among the largest of their times. Robert in particulartook bribery to the point of treason. "As Secretary of State andthe leading advisor to King James on foreign policy, [he] was aspecial recipient of favour, being offered large bribes by the Dutchnot to make peace with Spain, and large bribes by Spain to makepeace." (Stone, op. cit., p. 17.)[12]Though Balzac made a lot of money from writing, he was notoriouslyimprovident and was troubled by debts all his life.[13]A Timex will gain or lose about .5 seconds per day. The mostaccurate mechanical watch, the Patek Philippe 10 Day Tourbillon,is rated at -1.5 to +2 seconds. Its retail price is about $220,000.[14]If asked to choose which was more expensive, a well-preserved1989 Lincoln Town Car ten-passenger limousine ($5,000) or a 2004Mercedes S600 sedan ($122,000), the average Edwardian might wellguess wrong.[15]To say anything meaningful about income trends, you have totalk about real income, or income as measured in what it can buy.But the usual way of calculating real income ignores much of thegrowth in wealth over time, because it depends on a consumer priceindex created by bolting end to end a series of numbers that areonly locally accurate, and that don't include the prices of newinventions until they become so common that their prices stabilize.So while we might think it was very much better to live in a worldwith antibiotics or air travel or an electric power grid thanwithout, real income statistics calculated in the usual way willprove to us that we are only slightly richer for having these things.Another approach would be to ask, if you were going back to theyear x in a time machine, how much would you have to spend on tradegoods to make your fortune? For example, if you were going backto 1970 it would certainly be less than $500, because the processingpower you can get for $500 today would have been worth at least$150 million in 1970. The function goes asymptotic fairly quickly,because for times over a hundred years or so you could get all youneeded in present-day trash. In 1800 an empty plastic drink bottlewith a screw top would have seemed a miracle of workmanship.[16]Some will say this amounts to the same thing, because the richhave better opportunities for education. That's a valid point. Itis still possible, to a degree, to buy your kids' way into topcolleges by sending them to private schools that in effect hack thecollege admissions process.According to a 2002 report by the National Center for EducationStatistics, about 1.7% of American kids attend private, non-sectarianschools. At Princeton, 36% of the class of 2007 came from suchschools. (Interestingly, the number at Harvard is significantlylower, about 28%.) Obviously this is a huge loophole. It does atleast seem to be closing, not widening.Perhaps the designers of admissions processes should take a lessonfrom the example of computer security, and instead of just assumingthat their system can't be hacked, measure the degree to which itis.
