Bernard Madoff and the Confidence Man

Everyone's been talking about the newest conman, Bernie Madoff. What some might not know is that the con man (con is from confidence) is a staple character of American culture. Mr. Dr. Frugal Scholar is a scholar of, among other things, American literature. So I asked him for his thoughts on the confidence man. Here are his thoughts, Part 1.
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We shouldn’t be too surprised at the revelation of Bernard Madoff’s “success” at bilking major institutions and well-connected, savvy individuals out of billions of dollars. As a number of observers have pointed out, the confidence man is something of a cultural icon in America, and has been around since—without much exaggeration—the European discovery of the New World. In about 1616 John Smith tried to recruit participants in his colonization scheme by selling New England as a sort of sportsman’s paradise, where one had to work “but three dayes in seaven.” (No mention of winter, ice storms, etc.) He wasn’t successful, but about a century later in our neck of the woods John Law managed to sell a whole lot of worthless stock in Louisiana land to the French merchant class and aristocracy—the famous “Mississippi Bubble”—ruining a lot of people who should have known better. So the pundits are wrong—it’s not just the poor and uneducated who get scammed.

In the late 1840s there was William Thompson, to whose escapades we owe the term “confidence man.” Thompson developed an ingenious and effective strategy: he’d engage prosperous looking people in conversation, lament the decline of confidence and trust in contemporary society, and then ask “Have you the confidence to trust me with your watch until tomorrow?” A surprising number of his interlocutors did, and they never saw their watches again. It wasn’t just the mid-19th century popular New York press who found Thompson fascinating; the confidence man in one form or another has been a staple ever since. Just think of Herman Melville’s The Confidence Man, published eight years after Thompson was arrested, or the King and the Duke in Twain’s Adventures of Huckleberry Finn, or--to bring things up to date—McMurphy in Ken Kesey’s One Flew Over the Cuckoo’s Nest, Dr. Gonzo in Hunter Thompson’s Fear and Loathing in Las Vegas, or a whole slew of movies like "The Sting," “Catch Me If You Can," "The Grifters," “Matchstick Men,” "The House of Games," “The Spanish Prisoner,” and on and on.

So Madoff is nothing new; in fact, he’s a familiar type. And that got me to thinking about the connections between confidence and frugality, and I wrote the little “meditation” below. In the spirit of economy (I can’t throw anything out), I’ll post it, even though it did not get the most enthusiastic reaction from Ms. Dr. FS (“what are you talking about?”). But I have full confidence in you, my trusted readers.


Part 2 will be posted later. Be on the look-out.