There is always someone better than you

The Scarcity Mindset vs The Plenty Mindset

Aug 03, 2024

There are two types of people in the world:

Those with a scarcity mindset and those with a plenty mindset.

The key difference between these two types of people is that the former always looks at the glass as half empty, while the latter always sees the glass as half full.

Defining these two types of people:

The Scarcity Mindset Person

The person who is never satisfied, always complaining or finding alternative reasons for what could have been, and always thinks that the grass is greener on the other side. They are always looking for a reason as to why they didn’t get what they wanted, often blaming someone other than themselves.

The Plenty Mindset Person

The person who is accepting of an outcome or situation, even if it did not go according to plan, focuses on what can be done better in the future to ensure success. This person does not blame anyone else but always looks inward to see how the situation can be improved.

Let’s take an example sentence and see how the framing of these sentences separates these two types of people.

The Plenty mindset:

“I fulfilled my financial goals and was able to buy the dream house I wanted. I know I can achieve much more if I follow and stick to my process. I can learn from my mistakes and do even better the next time”

The Scarcity Mindset:

“I could have made much more if I had invested in that other stock or fund and would have been able to buy an even bigger house in the same time period as my friend. I regret making such poor mistakes and wish I had done something else ”

The scarcity mindset always frets on the past and never lives in the moment. Always comparing.

Don’t confuse this mindset with ambition.

Ambitious people look inward to see how they can do better and are never satisfied with themselves. They are always looking to improve rather than blaming someone else.

The scarcity mindset is typically seen among us corporate office folks, who are always benchmarking our achievements against someone else within or outside the organization and comparing metrics rather than asking ourselves difficult questions and questioning why we are not getting what we want to work towards.

Companies prey on people with a scarcity mindset.

They can easily manipulate someone who is never satisfied, as this person is always looking for alternatives, deviating from a plan by complaining or comparing.

Many products and services are customized in such a way that they capture the person with a scarcity mindset, as this person will never be satisfied and always want more.

Around 20 years ago, a group of Harvard students were asked in a study by Solnick and Hemenway whether they would prefer $50,000 while everyone else received $25,000, or $100,000 while everyone else got $250,000.

The majority chose the former option by a large margin.

A British economist, Sir Richard Layard, breaks down this phenomenon with two observations:

It’s not how well you are doing, it’s how well you are doing relative to others.
The income we are earning today is short-term; our attention eventually shifts to someone who is earning more than us.
Even Jeff Bezos and Bill Gates will face this. It's impossible for it to have any end.
Your current income is judged relative to your previous income.
Once you make X and your salary is doubled to 2X, now 2X becomes your new benchmark. However, there is a limit to this growth given certain circumstances, and it will not continue to grow in the same way it did before but the comparisons will never stop.

There is a paradox that explains these two points called the Easterlin Paradox: just as with this phenomenon with the incomes of individuals, so does it happen with countries.

Rich nations operate with a scarcity mindset.

Ironically, as these nations chase more wealth, it does not translate to happiness; otherwise, the richest countries would be the happiest.

There are three indices independent of GDP that measure the contentment of people in these nations:

The Prosperity Index (a mix of national economy and personal well-being)
The Happiness Report (inflation-adjusted GDP-per-capita, life expectancy, someone to count on, perceived freedom to make life choices, freedom from corruption, individual generosity)
The Happy Planet Index (life satisfaction, longevity, ecological footprint)

A growing GDP is mandatory, and there is no compromise for this, but the expectation of a growing GDP is not necessarily correlated with happiness.

A growing GDP with a scarcity mindset only adds to the ever-growing problem of envy and scarcity mindset.

This means we must look within ourselves as our economy continues to grow and we work harder to contribute, without relying too much on the material outcomes of our success, because there will always be someone doing better than us.

Morgan Housel beautifully captures this concept with his tweet:

The scarcity mindset is one that never ends.

When you don’t open up to people, you trigger a scarcity mindset because you are prone to lying or over-selling yourself which creates a dangerous environment of low trust, which can cause one to feel scarce.

You lie to prove your worth, but honesty will always require a plenty mindset.

Because telling the truth requires you to be brutally honest about yourself.

Robert Greene, in his book The 48 Laws of Power, mentions this in the 10th Law of Power, which advises avoiding unhappy people, whom I refer to as people with a scarcity mindset.

He provided an interesting example of this law by referencing Cassius, Brutus, and Caesar which brought back memories of my10th-standard ICSE Julius Caesar English Literature textbook.

"The unfortunate sometimes draw their misfortune on themselves, and they will also draw it on you. Associate with the happy and fortunate instead."

Julius Caesar could sense the envy in Cassius and knew he was a man driven by jealousy.

Therefore, he passed on the position of first praetorship to Brutus, whom he trusted with his life.

Cassius, who was envious, always hated Caesar for this and poisoned Brutus’s mind against him, never considering how he might prove his own worth through genuine effort.

Brutus was not like Cassius in this regard.

Although Brutus was also opposed to Caesar’s dictatorship, if he had remained patient and not been influenced by Cassius, he could have become the leading figure after Caesar’s death.

There might have been better ways to handle the situation, but Cassius chose the path of envy and deceit.

"Yond Cassius has a lean and hungry look. He thinks too much…."

"I do not know the man I should avoid so soon as that spare Cassius…."

"Such men as he be never at heart’s ease whiles they behold a greater than themselves, and therefore are very dangerous."

— Julius Caesar, William Shakespeare, 1564-1616

The people who see the glass half full have the ‘plenty mindset,’ while those who see the glass half empty have the ‘scarcity mindset.’

Source: VisualHustles on Instagram

How you speak to yourself says a lot about you, and this is a vicious, endless cycle we can carry to our grave.

Conclusion

Life is a never-ending game of comparison for even the most powerful and well-to-do people in the world.

Developing a 'plenty mindset' over time is crucial because what is the point of working hard towards our goals and for the people around us if we can’t take joy in the effort we have put in and are always benchmarking ourselves against others to see how we can do better than them?

But this does not happen with the click of a button; it is something we need to constantly practice, and it gets easier over time

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