Does Money Make You Stupid?

Sarah Ferguson/Image © Shutterstock

Like many of you, I woke up yesterday to the news that Sarah Ferguson, the Duchess of York, was caught on camera accepting money in exchange for access to her ex-husband, Prince Andrew, who also happens to be the British trade representative. Looking as disheveled as you’d expect someone who had no idea she was being filmed to look, Fergie said, “If you want to meet him in your business, look after me and he’ll look after you … you’ll get it back tenfold.” Looking after Fergie, it turns out, costs $730,000, though you can get through the door with an initial down payment of 40 grand.

Of course, the whole thing came crashing down around her. The person on the other side of the transaction was an undercover reporter who apparently specializes in getting the rich and famous to do stupid things. About the only good thing one can say about the Duchess is that, unlike the recently scandal-plagued Rand Paul and Richard Blumenthal, she learned the lesson of Richard Nixon and apologized pronto. “I very deeply regret the situation and the embarrassment caused,” she said, then noted, “It is true that my financial situation is under stress.”

Which raises an interesting few questions: Why does money cause people to do stupid things? Does money in fact turn us into different, less-rational versions of ourselves? And how much money does it take for that to happen? Let’s break it down.

It’s not just the money that causes people to behave irrationally, explains Wall Street Journal columnist Jason Zweig, author of Your Money and Your Brainit’s the loss or potential gain of money. Fergie had both. Her financial situation deteriorated over the past year or so and she’s reportedly hundreds of thousands of dollars in arrears. “Losing money is very painful,” Zweig says. “People can find it very disorienting and it makes a lot of people really distraught. This is particularly true if you used to have a lot of money and you lost a lot.” Bingo.

Moreover, he notes that the emotional feelings associated with that loss can make it very hard for people to not only think clearly at the time but to envision any longer-term consequences of the actions they’re taking. “When emotions are running high, when people are in a hot state, it’s hard for them to picture or remember how they’re likely to feel about this decision in a cold state.” That might explain how she’d be able to put her relationship with Prince Andrew on the line at the same time she’s living in a wing of his house.

What money does not do, argues Psychologist Gail Saltz, author of Anatomy of a Secret Life, is turn you into a totally different animal. “Just like alcohol doesn’t make people do things they weren’t capable of doing, I don’t think money could take a person with no sociopathy and turn them into [someone else],” she says. “For the most part, this is not a woman who has never done anything unethical in her life.” The underlying problem is one of acquired narcissism. When you’re in a position of power and entitlement it grows your idea that you can do whatever you want. “Someone like Sarah Ferguson could feel that without [the money] she wouldn’t have status and power and that’s frightening. But to cross the line from “I’m scared” to “I’m going to do something that risks my reputation and my relationship with my ex, the father of my children,” that’s a person who is thinking pretty exclusively of themselves.”

But the more money on the line, the more logic flies out the window. When the jackpot is really big, it focuses your attention and crowds out everything else in your mind. All you can really think about is that big chunk of change, says Zweig, not the morning after when you have to think about what you did. Want proof? Think the last time the Powerball jackpot got really big. Even people who don’t pay attention when the jackpot is a million dollars get excited about buying a ticket. They say to themselves, “Look at how much money this is” – not, “My odds of winning just got significantly worse.” The bigger the payoff, the less rational we tend to be. And for most people – including Sarah Ferguson, evidently – $730,000 is a big payoff indeed.

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