I’ve called this system neofeudalism for years now because that’s what it looks like to me. Growing obscene inequality. I follow English economist Gary Stevenson on YouTube. He also says inequality is the problem and the only way to solve it is to tax the rich, with wealth tax not income tax. MAGA is so nostalgic for the 50’s but they don’t want to talk about the 90% corporate tax rate that made it all possible! They think returning to 19th century tariffs aka taxes will replace the need for income tax. How’s that working out so far?
It would be literally impossible to tariff enough to replace income tax, unless you want every import to cost like 5x what it costs now, and then, if you did that, and the world economy didn't literally collapse, we would eventually succeed in making everything in the US, but then we would have 0 imports, ergo 0 tariff income, and then what?
They can't have their cake and eat it too. If we succeed in bringing manufacturing back to the US, then we end up with 0 tariff income, and still need national income tax.
They want to go back to 1789, when the only tax the government could levy was import tariffs. It is the ultra-conservative idea that applying the past to the future is the only way, even when circumstances change so radically it cannot make sense. The same delusion applies to denying climate change.
I don't know what just happened to my original comment. It disappeared without a trace. Until TODAY, I haven't heard ANYONE discuss our stratified society as a serfdom, but that's how I've felt almost my entire life; that I and others like me are indentured servants, sharecroppers, borrowing from the company store, who charges outrageous prices and loanshark interest rates because our wages are a pittance that will forever keep us indebted to their employ.
Additionally, as someone with lifetime Type¹ Diabetes, I've had to battle not ONLY a killer disease, but the SYSTEM whose SOP is to Delay Deflect Deny coverage of ESSENTIAL medications that would enable me to merely survive. When Luigi shot and killed that United Health Care Insurance CEO, I wasn't horrified (My usual response to violence) I felt VINDICATED, in a way.
We're not just RESENTFUL at the systemic disparity; we're ENRAGED.
Every living soul deserves the basic necessities; a home, quality food, quality healthcare, a quality education, a LIVING wage, and OPPORTUNITIES to create and contribute to the world we live in. 🌏💖🕊
I feel like our entire debt debate is the biggest scam, only seconded by the way we've actually handled the debt for the last 50 or so years.
The idea that we lowered the taxes for the richest people in the country, only to turn around and borrow those very would be taxes from them at interest, then turn around and suggest that we need to tighten our belts by cutting the social safety net because now we owe "too much" is a level of absurdity that couldn't make it into a book or movie because it's too on the nose. Especially when you consider the incredible amount of wealth that this debt has successfully generated...
Oh, also the big jump in 2013 is partially because the Census didn't create reports on wealth distribution for about 10 years, which is highly annoying. And then, the federal reserve graphs no longer show in quintiles, they do 0-50% 50-90, 90-99 then breakdown of top 1%.
I don't even mind that as much, I just find the quintile distribution much more useful. Bundling 2.5 quintiles in one group makes it very difficult to really watch how wealth is changing over time across poor/working/lower middle class people.
Maybe I'm being paranoid, but I feel like they did it intentionally precisely so you can't see that info easily. Plus, when you group the entire bottom 50% together, you can't see that 20% of the population (bottom quintile) has essentially 0 wealth, and the second quintile has almost 0 wealth too (~1% of total wealth).
Agree, we need deciles, by me, probably by 5s for real insight.
This is related to one peeve, which is Bernie constantly saying the top 3 billionaires have more than the bottom half of the USA, and others repeating that.
The top 3 may have more than the bottom half ** of the world ** -- but NOT the bottom half of the USA. That's not a good thing for the world, but we have to support the bottom half of the USA and inspire them.
The bottom half of the USA estimate we can see, and they have about $4 Trillion. The top 10 billionaires don't quite get to $1 Trillion, especially after Elon's deflation, last I tried to add it up.
This is very important, BECAUSE IT IS POWER. The top billionaires are NOT the boss of even the bottom half of the USA population . . . !
It's the 99 of US, who have to keep that 1 honest. We can do it -- b.rad
I think we might have actually missed some crucial data! I'm just looking through more of the tables in the federal reserve. The 190 trillion in assets isn't even all the assets in the U.S.
it does seem to suggest that the net wealth is close to 160T, so I don't know... seems odd to me, unless the 61.9/28.1 trillion for Corporate and Non Corporate business is already reflected within the household amounts...
The reason for the title is that it's in part a response to the Atlantic article, which is titled "Congressional Republicans Might Set Off the Debt Bomb"
Really appreciated how you reframed the conversation — it’s not the size of the debt that’s the real threat, but the way the wealth it creates gets siphoned off by a shrinking elite. That’s the kind of structural problem that changes everything, and it’s not talked about enough
Really appreciated how you reframed the conversation — it’s not the size of the debt that’s the real threat, but the way the wealth it creates gets siphoned off by a shrinking elite. That’s the kind of structural problem that changes everything, and it’s not talked about enough
Thank you for this explanation. I’m not super experienced with money but just critically thinking I’ve suspected this was the case. But I didn’t have the words to explain well or even ask questions. This helps so much. I’m going to print it so I can study it more, make notes, write out questions and share. I know my partner will appreciate this as well and we can go over it together. He is well educated but sometimes has difficulty with new concepts and unfamiliar jargon. He’ll say “explain it to me like I’m a third grader”. 😌I often contemplate that request in my own writing or talking. Simplifying communication so anyone can understand it is a huge challenge.
The charts are great at helping picture what you’re explaining. I appreciate you and your writing so much.
Thank you for this article, and the data references. Your logic is very sound. Adding to the discussion would be to consider all types of debt apart from government debt, because this also impacts economic stability and wealth distribution. Companies have been taking on more debt (corporate), homeowners more mortgage debt as house prices rise, more personal consumer debt (ie car finance debt). Also there has been a big increase in financial sector debt. I do not have any detailed knowledge of the economics of this, but understand a lot of this debt is about companies like hedge and private equity funds, who borrow to manipulate markets or buy and sell companies. They still accumulate debt that has to be paid back, and if they default at scale they dump assets and so prices crumble. So if you add this total-debt up, and measure it as a % of current GDP, this total-debt as % of GDP, has not been as high as it is now since 1930. Bravos Research did a neat graph of total-debt as % GDP over the last 150 years, on to which I imposed income of top 1% families as % GDP since 1918. Pity cannot add image in comment. The two lines follow each other quite well. Most American government debt (and total-debt) is owned by other Americans as you say, so the link of inequality rising as total-debt rises is not surprising. ==== Sorry to go on but linked to this idea of inequality v total-debt (as % GDP) is the idea that the current situation is not sustainable, because a viable economy and viable democratic system cannot continue under these conditions. The people behind Trump and MAGA, the conservative billionaires with their think tanks - institutions, know this truth, which is why Trump was empowered to take over the GOP and get a MAGA regime elected. During the Great Depression the conservatives were too late, FDR got in there with New Deal style reforms and rearmament to fight the global fascist threat. In 1933 the wealthy elite plotted a coup under General Smedley Butler and failed miserably. This time it is the Democrats who have failed miserably. Now powerful Americans have too much wealth and economic power to lose. This is the engine which is driving the Trump regime, to those who think the regime will back down, or that it will just be voted out in 2028, I would say they have not reckoned with the whole of the forces against American democracy. The under-educated MAGA crazies who believe Trump was sent by God to save them are the weakest part of the anti-democratic disaster the US is bringing to itself and by extension to the democratic West.
Nobody understands our government's finances. And our government likes it that way! That's because the budget is where you find the truth. As you have said, if you know how to read a balance sheet or an annual/quarterly report--& know what to look for--you can tell exactly what a company or other entity is doing.
I’ve called this system neofeudalism for years now because that’s what it looks like to me. Growing obscene inequality. I follow English economist Gary Stevenson on YouTube. He also says inequality is the problem and the only way to solve it is to tax the rich, with wealth tax not income tax. MAGA is so nostalgic for the 50’s but they don’t want to talk about the 90% corporate tax rate that made it all possible! They think returning to 19th century tariffs aka taxes will replace the need for income tax. How’s that working out so far?
It would be literally impossible to tariff enough to replace income tax, unless you want every import to cost like 5x what it costs now, and then, if you did that, and the world economy didn't literally collapse, we would eventually succeed in making everything in the US, but then we would have 0 imports, ergo 0 tariff income, and then what?
They can't have their cake and eat it too. If we succeed in bringing manufacturing back to the US, then we end up with 0 tariff income, and still need national income tax.
Exactly! They don’t think anything through.
They want to go back to 1789, when the only tax the government could levy was import tariffs. It is the ultra-conservative idea that applying the past to the future is the only way, even when circumstances change so radically it cannot make sense. The same delusion applies to denying climate change.
I don't know what just happened to my original comment. It disappeared without a trace. Until TODAY, I haven't heard ANYONE discuss our stratified society as a serfdom, but that's how I've felt almost my entire life; that I and others like me are indentured servants, sharecroppers, borrowing from the company store, who charges outrageous prices and loanshark interest rates because our wages are a pittance that will forever keep us indebted to their employ.
Additionally, as someone with lifetime Type¹ Diabetes, I've had to battle not ONLY a killer disease, but the SYSTEM whose SOP is to Delay Deflect Deny coverage of ESSENTIAL medications that would enable me to merely survive. When Luigi shot and killed that United Health Care Insurance CEO, I wasn't horrified (My usual response to violence) I felt VINDICATED, in a way.
We're not just RESENTFUL at the systemic disparity; we're ENRAGED.
Every living soul deserves the basic necessities; a home, quality food, quality healthcare, a quality education, a LIVING wage, and OPPORTUNITIES to create and contribute to the world we live in. 🌏💖🕊
I feel like our entire debt debate is the biggest scam, only seconded by the way we've actually handled the debt for the last 50 or so years.
The idea that we lowered the taxes for the richest people in the country, only to turn around and borrow those very would be taxes from them at interest, then turn around and suggest that we need to tighten our belts by cutting the social safety net because now we owe "too much" is a level of absurdity that couldn't make it into a book or movie because it's too on the nose. Especially when you consider the incredible amount of wealth that this debt has successfully generated...
Thanks!
Great to see our wealth detailed like this, just skimmed it so far.
For me, your title is a bit labored. Even after reading some, it’s hard to parse.
You know that for me, the point is ‘WE ARE NOT IN DEBT.’ That is the Biggest Lie.
Bill Gates and the zillionaires have credit cards and loans. They are not in debt.
The graph that woke me up the most is the one showing the shift in wealth holdings that takes a quantum jog up up up around 2013, for the wealthiest.
That’s a keeper ! Lead with that in your promotions of this work, maybe. I’ll give that a try too.
Note: They are all keepers !
thanks again for all the work you put into this eye opener!
cheers! — b.rad
<uswealthclock.com>
Oh, also the big jump in 2013 is partially because the Census didn't create reports on wealth distribution for about 10 years, which is highly annoying. And then, the federal reserve graphs no longer show in quintiles, they do 0-50% 50-90, 90-99 then breakdown of top 1%.
I don't like that at all, personally.
The Federal Reserve distribution numbers are frustrating, partly good.
They are based on surveys, every 3 years, and then applied to the whole numbers, which I believe is what the Fed can really see and measure.
But really — surveys? ‘Mr Bezos, how much shit do you have ?’
Those numbers should be by assessor and audit. That’s what most of us face for our primary asset.
Granularity at the top is valuable, but as you say some specifics in the 90% would be so much better. Looking . . . b.rad
I don't even mind that as much, I just find the quintile distribution much more useful. Bundling 2.5 quintiles in one group makes it very difficult to really watch how wealth is changing over time across poor/working/lower middle class people.
Maybe I'm being paranoid, but I feel like they did it intentionally precisely so you can't see that info easily. Plus, when you group the entire bottom 50% together, you can't see that 20% of the population (bottom quintile) has essentially 0 wealth, and the second quintile has almost 0 wealth too (~1% of total wealth).
Agree, we need deciles, by me, probably by 5s for real insight.
This is related to one peeve, which is Bernie constantly saying the top 3 billionaires have more than the bottom half of the USA, and others repeating that.
The top 3 may have more than the bottom half ** of the world ** -- but NOT the bottom half of the USA. That's not a good thing for the world, but we have to support the bottom half of the USA and inspire them.
' . . . 2021 Oxfam study says top 10 have more than bottom 3 billion people . . . . ' <https://en.wikipedia.org/wiki/Distribution_of_wealth>
The bottom half of the USA estimate we can see, and they have about $4 Trillion. The top 10 billionaires don't quite get to $1 Trillion, especially after Elon's deflation, last I tried to add it up.
This is very important, BECAUSE IT IS POWER. The top billionaires are NOT the boss of even the bottom half of the USA population . . . !
It's the 99 of US, who have to keep that 1 honest. We can do it -- b.rad
I think we might have actually missed some crucial data! I'm just looking through more of the tables in the federal reserve. The 190 trillion in assets isn't even all the assets in the U.S.
https://www.federalreserve.gov/releases/z1/20250313/html/default.htm
B.101 Balance Sheet of Households and Nonprofit Organizations
https://www.federalreserve.gov/releases/z1/20250313/html/b101.htm
(This shows the 190 trillion from the wealth clock as of 2024Q4)
But then there are the following 2 additional tables
B.103 Balance Sheet of Nonfinancial Corporate Business
https://www.federalreserve.gov/releases/z1/20250313/html/b103.htm
61.9 trillion as of 2024Q4
B.104 Balance Sheet of Nonfinancial Noncorporate Business
https://www.federalreserve.gov/releases/z1/20250313/html/b104.htm
28.1 trillion as of 2024Q4
That means that the total assets is actually 280 trillion and the net assets is not 160T but more like 250T (when you subtract debt held by the fed)
The weird thing is that in this table
B.1 Derivation of U.S. Net Wealth
https://www.federalreserve.gov/releases/z1/20250313/html/b1.htm
it does seem to suggest that the net wealth is close to 160T, so I don't know... seems odd to me, unless the 61.9/28.1 trillion for Corporate and Non Corporate business is already reflected within the household amounts...
The reason for the title is that it's in part a response to the Atlantic article, which is titled "Congressional Republicans Might Set Off the Debt Bomb"
Really appreciated how you reframed the conversation — it’s not the size of the debt that’s the real threat, but the way the wealth it creates gets siphoned off by a shrinking elite. That’s the kind of structural problem that changes everything, and it’s not talked about enough
Really appreciated how you reframed the conversation — it’s not the size of the debt that’s the real threat, but the way the wealth it creates gets siphoned off by a shrinking elite. That’s the kind of structural problem that changes everything, and it’s not talked about enough
Thank you for this explanation. I’m not super experienced with money but just critically thinking I’ve suspected this was the case. But I didn’t have the words to explain well or even ask questions. This helps so much. I’m going to print it so I can study it more, make notes, write out questions and share. I know my partner will appreciate this as well and we can go over it together. He is well educated but sometimes has difficulty with new concepts and unfamiliar jargon. He’ll say “explain it to me like I’m a third grader”. 😌I often contemplate that request in my own writing or talking. Simplifying communication so anyone can understand it is a huge challenge.
The charts are great at helping picture what you’re explaining. I appreciate you and your writing so much.
Awesome article. Thanks, Lukium.
Thank you for this article, and the data references. Your logic is very sound. Adding to the discussion would be to consider all types of debt apart from government debt, because this also impacts economic stability and wealth distribution. Companies have been taking on more debt (corporate), homeowners more mortgage debt as house prices rise, more personal consumer debt (ie car finance debt). Also there has been a big increase in financial sector debt. I do not have any detailed knowledge of the economics of this, but understand a lot of this debt is about companies like hedge and private equity funds, who borrow to manipulate markets or buy and sell companies. They still accumulate debt that has to be paid back, and if they default at scale they dump assets and so prices crumble. So if you add this total-debt up, and measure it as a % of current GDP, this total-debt as % of GDP, has not been as high as it is now since 1930. Bravos Research did a neat graph of total-debt as % GDP over the last 150 years, on to which I imposed income of top 1% families as % GDP since 1918. Pity cannot add image in comment. The two lines follow each other quite well. Most American government debt (and total-debt) is owned by other Americans as you say, so the link of inequality rising as total-debt rises is not surprising. ==== Sorry to go on but linked to this idea of inequality v total-debt (as % GDP) is the idea that the current situation is not sustainable, because a viable economy and viable democratic system cannot continue under these conditions. The people behind Trump and MAGA, the conservative billionaires with their think tanks - institutions, know this truth, which is why Trump was empowered to take over the GOP and get a MAGA regime elected. During the Great Depression the conservatives were too late, FDR got in there with New Deal style reforms and rearmament to fight the global fascist threat. In 1933 the wealthy elite plotted a coup under General Smedley Butler and failed miserably. This time it is the Democrats who have failed miserably. Now powerful Americans have too much wealth and economic power to lose. This is the engine which is driving the Trump regime, to those who think the regime will back down, or that it will just be voted out in 2028, I would say they have not reckoned with the whole of the forces against American democracy. The under-educated MAGA crazies who believe Trump was sent by God to save them are the weakest part of the anti-democratic disaster the US is bringing to itself and by extension to the democratic West.
https://larakeller.substack.com/p/linking-economics-conservative-elites and other bits on LK substack
Nobody understands our government's finances. And our government likes it that way! That's because the budget is where you find the truth. As you have said, if you know how to read a balance sheet or an annual/quarterly report--& know what to look for--you can tell exactly what a company or other entity is doing.