There’s an interesting section in Michael Moore’s Dude, Where’s My Country about the “Horatio Alger Myth” in the US. His version is a variant of the common observation that people tend to “vote their aspirations” instead of voting their reality: people who believe that they will one day be rich often vote for policies that benefit the rich (including their future fantasy selves) even if those policies hurt them in the present. Therefore, by feeding them a steady diet of Great American Success Stories it’s possible to make people vote against their own self-interest.

I think there’s an even more insidious aspect to this, though. Due to the prevalence of such stories a certain percentage of people believe that if they show some entrepreneurial spirit and work hard they not only can become rich but must become rich. Never mind that no amount of hard work can overcome the handicap of making or doing something that people just won’t pay that much for. Never mind that no economy is perfectly efficient; even if the market exists you might not find it or be able to penetrate it. No, say the self-imagined capitalist heroes; if I put in the time I deserve to be rich and if I’m not then it’s somebody’s fault. It’s a pretty amazing sense of entitlement coming from people who deny every other kind of entitlement. What do people like this do when they feel they’ve been cheated? One is that they become very angry, and become ever more strident in their denunciation of the people – liberals, generally – who they feel have robbed them of their supposedly-deserved success. The other is that they decide that if they’ve been made a victim by the rules then the rules don’t apply to them. That’s where Ken Lay and Bernard Ebbers and Richard Scrushy (whose portrayal on 60 Minutes last night initiated this chain of thought) come from.

By giving people an unrealistically positive portrayal of the odds for success in the entrepreneurial world, we guarantee that a certain number of them will turn into the jerks who infest our civic dialog and cheaters who fill our court dockets. We need to work harder to make sure that people know the relationship between risks and rewards. If you want to shoot for the really big money you must understand that the odds are slim, and be prepared to accept that your failure might not be anybody else’s fault. If you can’t handle that, you should accept the likelihood of lower rewards in return for lower risk. Nobody has a right to both low risk and great reward.