Why we are so fascinated by liars

George Santos did not attend the elite schools or colleges he lists on his resume. He has not worked at Goldman Sachs or Citigroup. He was also not on the elite high school volleyball team. His parents did not die in the World Trade Center murder, his grandparents did not escape the Holocaust, and his employees did not die in a shooting at a gay club in Orlando, Florida.

Nor is Santos Jewish, as he pretended, nor “Jewish,” as he somewhat clumsily corrected. He also seems to have a bad personality. People associated with him report being robbed by him. He allegedly even embezzled the money he raised for a homeless veteran’s dog operation.

Perhaps Santos, if his name is Santos at all, is more than a petty criminal. Several research firms are beginning to take an interest in how he was able to pay $700,000 out of pocket for his campaign. The year before, he reported an annual income of just $50,000. He also worked for a fund that is now being investigated for box fraud worth millions.

In short: George Santos is a political backbencher and possibly a con artist. In any case, he is a trickster – which is exactly why he has become a person who has been dominating people’s imaginations for weeks now not only in the US but worldwide. Why?

An obvious explanation is that cheaters have always existed and have always fascinated people. The example of Carl Friedrich von Münchhausen is cited as evidence for this thesis. This legendary lying baron captivated people in the 18th century with boasting such as pulling himself out of a swamp by his own bootstraps or riding a cannonball.

Another explanation is the clothes make the man theory. Crew neck sweaters, a blue blazer, a striking neckerchief and a brown cashmere coat have become Santos’ trademarks. This is no coincidence. “It’s the uniform of a student for whom math and grammar are part of their education, but whose ultimate goal is power,” Robin Givhan wrote in the Washington Post.

Besides the school uniform, Santos lacks any sense of wrongdoing. The man is completely shameless. He protests how he is portrayed in the media. “But he does it with the demeanor of a man comfortable in his shame,” Givhan said.

Munchausen’s thesis is too general to capture the phenomenon of George Santos, and the statement that clothes make people does not go far enough. Sam Bankman-Fried (SBF), an impostor much better than Santos, has also been in the news for months. And what is considered the biggest con artist in the US since Bernie Madoff is anything but a man who values ​​his looks. His trademarks are shorts and a curly head.

It is therefore natural to look for other reasons why barons of lies have it so easy in our time. One who has done that is Mihir Desai, professor of finance at Harvard University. In a recent column in The New York Times, he identified the rampant magical thinking and belief in technology in modern society.

Kryptos as a good example of magical thinking

For the finance professor, cryptocurrencies are the best example of magical thinking. “I have come to believe that cryptocurrencies are more than an exotic asset,” said Desai. “Rather, they are the manifestation of a magical thinking that gripped parts of the generation that grew up after the Great Recession — and American capitalism in general.”

The meteoric rise of crypto exchange FTX shows how powerful magical thinking has become. SBF built more than a Ponzi scheme that was bound to collapse at some point. He did what only central banks can do: create his own money. In this way, SBF was able to build up billions in capital in a short time. He has not only scammed unsuspecting small savers. Well-known figures on Wall Street have fallen for his deceit, well-known financial publications have hailed him as the JP Morgan of today.

SBF has managed to do all of this, although to this day cryptocurrencies do not fulfill any of the three basic functions of money. They are not suitable either as a medium of exchange or as a unit of account, and certainly not as a store of value. How can this be explained?

Desai sees the cause in a fatal combination of magical thinking, belief in technology and hatred of the establishment. “The illusory and ridiculous promises, a collective anti-establishment sentiment fueled by a technology most of us don’t understand. Who needs government, banks, the traditional internet or the realization that you can only operate with money you own?»

Magical thinking and belief in technology have now gripped large parts of society and the economy. Elizabeth Holmes, for example, managed to fool prominent corporate representatives and politicians into believing that she and Theranos co-developed the iPhone for healthcare. Or, thanks to Techno-Speak, WeWork founder Adam Neumann has stylized the banal renting of office space into a technological sensation. Desai also rightly points out that despite all the techno-glam, Google and Facebook are ultimately little more than gigantic advertising agencies.

The combination of magical thinking and belief in technology is not to be trifled with. “Neither new technologies nor cheap money have undermined the fundamental laws of economics,” warns Desai. All attempts to repeal these laws have ended in tears.