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The Winners and Losers in 21st Century America April 28, 2025
Statistical games can be played to mask the realities of our neofeudal economy, but "narrative control" can't obscure the facts or the banquet of consequences that these realities have set.
Not everyone in America gained ground as a result of the rampant hyper-financialization and hyper-globalization of the 21st century. Let's begin our analysis of who gained ground and who lost ground in the year 2001, when China entered the WTO (World Trade Organization) and offshoring / globalization shifted into high gear and when the Federal Reserve began ramping up its financialization / monetary manipulation--oops, sorry, policy interventions. The top 1% and the top 10% gained ground. The bottom 90% lost ground, especially the bottom 50%. Wage earners lost ground, while corporate insiders, financiers, speculators using leverage and those lucky enough to be born long enough ago to buy assets at pre-bubble valuations gained ground. If you want to argue with these facts, argue with the Federal Reserve Database. All these charts are drawn from the St. Louis Federal Reserve FRED Database. Let's start with the varying multiples generated by asset bubbles since 2001. NASDAQ up 9.3X Corporate profits up 6.2X Case-Shiller Housing Index up 3X Those are some serious bubbles, given that $1 in 2001 is $1.80 in today's currency. If the NASDAQ index had risen at the same rate as inflation since 2001, it would be 3,340, not 17,166. Corporate profits would be $1.26 trillion annually, rather than $4.3 trillion. Hmm, $3 trillion a year is a nice chunk of extra change for gutting national security, quality and durability by offshoring essential industries. The Case-Shiller Housing Index would be up from 110 in 2001 to 200 today, rather than 323. So how did each household sector do since 2001? Net worth of top 1% up 5X Net worth of 90-99% up 3.9X Net worth 50-90% up 3.2X Net worth bottom 50% up 3X How much of the nation's total household net worth does each sector own now in dollars? Total net worth: $160.2 trillion top 1%: $49.4 trillion 90%-99%: $58.3 trillion Top 10%: $107.7 trillion Bottom 90%: $52.5 trillion Bottom 50%: $4 trillion Note that the top 1% own roughly the same net worth as the bottom 90%. How much of the nation's total household net worth does each sector own now as a percentage of total net worth? Total net worth: $160.2 trillion Top 1%: 31% 90%-99%: 36.5% TOP 10%: 67.5% Bottom 50%: 2.5% 50%-90%: 30% BOTTOM 90%: 32.5% Since wealth is concentrated in the top layer of each sector--the top 1% own the lion's share of the top 10%'s net worth, and the top 10% of the 50% to 90% sector own the lion's share of that sector's net worth--we can say with confidence that the top 20% own roughly 80% of the net worth--in line with the Pareto Distribution (the 80/20 rule). What's lost in this aggregate number is the extreme concentration of income-producing wealth (and thus political power) in the top 0.1% of the citizenry and the mere crumbs left to the bottom 60%. As many of us have pointed out over the past 15 years, the only accurate description for this system is neofeudal, where a New Nobility owns the wealth and political power, the bottom 80% are modern-day debt-serfs and the "middle class" is now the 90% to 99% sector, with those in the 80% to 90% sector having just enough home equity to fancy themselves "middle class" in name if not in ownership of income-producing assets or political influence. What do we call a system in which the top 1% own roughly the same net worth as the bottom 90%? Neofeudal. Any other description is misdirection / propaganda aimed at protecting the interests of the Nobility at the expense of the serfs. The NASDAQ stock market index: up 10X at its recent peak. 
Corporate profits up 6.2X as surveillance pricing, monopoly price-gouging, crapification, planned obsolescence and extortion have worked marvelously well in stripmining the citizenry to enrich the top 10% who own 90% of all stocks, the "shareholders." 
Wage earners' share of the nation's income has been slashed over the past five decades. Unsurprisingly, hyper-financialization and hyper-globalization did nothing to reverse this decline of American labor in favor of global capital. 
If housing fell 40% from its current valuation, it would return to the trend line. 
Here's a chart of net worth since 1950. Approximately $100 trillion was added above and beyond what inflation dictated. 
Some percentage of the bottom 50% benefited from the housing bubble, but even with the bump to $4 trillion in net worth, the bottom 50% owns a grand total of 2.5% of total net worth. 
Here's the 50% to 90% sector: 
Here's the 90% to 99% sector: 
Here's the top 1% sector: 
Statistical games can be played to mask the realities of our neofeudal economy and society. But narrative control by the well-paid apologist-punditry class--everyone's doing great because I'm doing great--can't obscure the facts or the banquet of consequences that these realities have set. A simple request of those who copy any of these charts: could you please publish the chart with the annotation credit intact rather than lop it off? Thank you. New podcast: Adaptability: The Key to Future Success, with the Contrarian Capitalist (53:40 min) New podcast: Trade, Tariffs and Globalization with Richard Bonugli (35:51 min) My recent books: Disclosure: As an Amazon Associate I earn from qualifying purchases originated via links to Amazon products on this site. The Mythology of Progress, Anti-Progress and a Mythology for the 21st Century print $18, (Kindle $8.95, Hardcover $24 (215 pages, 2024) Read the Introduction and first chapter for free (PDF) Self-Reliance in the 21st Century print $18, (Kindle $8.95, audiobook $13.08 (96 pages, 2022) Read the first chapter for free (PDF) The Asian Heroine Who Seduced Me (Novel) print $10.95, Kindle $6.95 Read an excerpt for free (PDF) When You Can't Go On: Burnout, Reckoning and Renewal $18 print, $8.95 Kindle ebook; audiobook Read the first section for free (PDF) Global Crisis, National Renewal: A (Revolutionary) Grand Strategy for the United States (Kindle $9.95, print $24, audiobook) Read Chapter One for free (PDF). A Hacker's Teleology: Sharing the Wealth of Our Shrinking Planet (Kindle $8.95, print $20, audiobook $17.46) Read the first section for free (PDF). Will You Be Richer or Poorer?: Profit, Power, and AI in a Traumatized World (Kindle $5, print $10, audiobook) Read the first section for free (PDF). The Adventures of the Consulting Philosopher: The Disappearance of Drake (Novel) $4.95 Kindle, $10.95 print); read the first chapters for free (PDF) Money and Work Unchained $6.95 Kindle, $15 print) Read the first section for free Become a $3/month patron of my work via patreon.com. Subscribe to my Substack for free The Mythology of Progress, Anti-Progress and a Mythology for the 21st Century print $20, (Kindle $9.95, Hardcover $24 (215 pages, 2024) audiobook, Read the Introduction and first chapter for free (PDF) 
What if growth--and policies to accelerate growth--are no longer working because our fix for every problem--growth for growth's sake--is failing? We're told Progress is inevitable as a result of technology, but everyday life is getting harder, not easier--the opposite of Progress, what I call Anti-Progress.
What if the real source of the unraveling is far deeper than economics or politics? What if the problem is what we see as the inevitable destiny of humanity--Progress--is actually a modern mythology, disconnected from the real-world consequences of growth for growth's sake? We indignantly reject that Progress is a mythology, but our need for mythology hasn't gone away because we've mastered technology; we've created a modern mythology of technology that is heedless of its own consequences. To truly progress, we need a new mythology aligned to 21st century realities. That's the goal of this book. Read the Introduction and first chapter for free Self-Reliance in the 21st Century print $18, (Kindle $8.95, audiobook $13.08 (96 pages, 2022) Read the first chapter for free (PDF) 
Just as no one was left unaffected by the rise of globalization, no one will be unaffected by its demise.
The only response that reduces our vulnerability is self-reliance: de-risk your life by carving a path that works for you.
When Ralph Waldo Emerson wrote his famous essay Self-Reliance in 1841, the economy was localized and households supplied many of their own essentials. Now we're dependent on distant sources for our essentials. For Emerson, self-reliance is thinking for ourselves rather than taking the conventional path. Self-reliance today means reordering our priorities and values. Self-reliance is often confused with self-sufficiency--the equivalent of Thoreau's cabin. But self-reliance isn't about piling up money or an isolated cabin; it's about cooperating with trustworthy others in productive networks. The book details the essential mindset of self-reliance and 18 nuts and bolts principles of self-reliance in the 21st century. Podcast with Richard Bonugli: Self Reliance in the 21st Century (43 min)
Recent entries: The Winners and Losers in 21st Century America April 28, 2025 The Wile E. Coyote Recession April 23, 2025 What's "Normal" in a Hyper-Normalized World? April 21, 2025 The Family Home: From Shelter to Asset to Liability April 18, 2025 This Nails It: The Doom Loop of Housing Construction Quality April 16, 2025 Trade, Tariffs, Currencies, Colonialism, the Gold Watch and Everything April 14, 2025 Last Gasp of the Landfill Economy April 10, 2025 A Decade of Headwinds April 9, 2025 The Financial Kessler Effect April 7, 2025 After the Tariff Earthquake April 4, 2025
The Global Trade Game: Jokers Are Wild
April 2, 2025
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Extra-Special Bonus Aphorisms:
"There is no security on this earth; there is only opportunity." (Douglas MacArthur) "We are what we repeatedly do." (Aristotle) "Do the thing and you shall have the power." (Ralph Waldo Emerson) "Any intelligent fool can make things bigger, more complex, and more violent. It takes a touch of genius and a lot of courage to move in the opposite direction." (E.F. Schumacher, via Tom R.) "He who will not risk cannot win." (John Paul Jones) "When we drink coffee, ideas march in like the army." (Honore de Balzac) "Progress is not possible without deviation." (Frank Zappa, via Richard Metzger) "Victory favors those who take pains." (amat victoria curam) "The man who has a garden and a library has everything." (Cicero, via Lee Bentley) "A healthy homecooked family meal and a home garden are revolutionary acts." (CHS) "Do you know what amazes me more than anything else? The impotence of force to organize anything." (Napoleon Bonaparte) "The way of the Tao is reversal" Or "Reversal is the movement of Tao." (Lao Tzu) "Chance favours the prepared mind." (Louis Pasteur) "Success consists of going from failure to failure without loss of enthusiasm." (Winston Churchill) "Where there is ruin, there is hope for treasures." (Rumi) "The realm of gratitude is boundless." (CHS, 11/25/15) "History doesn't have a reverse gear." (CHS, 12/22/15) Smith's Law of Conservation of Risk: Every sustained action has more than one consequence. Some consequences will appear positive for a time before revealing their destructive nature. Some consequences will be intended, some will not. Some will be foreseeable, some will not. Some will be controllable, some will not. Those that are unforeseen and uncontrollable will trigger waves of other unforeseen and uncontrollable consequences. (July 8, 2014)(thanks to Lew G. for retitling the idea.) Smith's Neofeudalism Principle #1: If the citizenry cannot replace a kleptocratic authoritarian government and/or limit the power of the financial Aristocracy at the ballot box, the nation is a democracy in name only. The Smith Corollary to Metcalfe's Law (The Network Effect): the value of the network is created not just by the number of connected devices/users but by the value of the information and knowledge shared by users in sub-networks and in the entire network. (CHS, 4/6/16) My Credo of Liberation: I no longer care if the power centers of our society--the distant, fortified castles of our financial feudal system--are changed by my actions, for I am liberated by the act of resistance. I am no longer complicit in perpetuating fraudulent feudalism and the pathology of concentrated power. I no longer covet signifiers of membership in the Upper Caste that serves the plutocracy. I am liberated from self-destructive consumerist-State financialization and the delusion that debt servitude and obedience to sociopathological Elites serve my self-interests. (Thank you, Klaus-Peter L., for reminding me) "We've become a culture of excuses rather than solutions: solutions always require sustained effort and discipline." (CHS 4/9/16) "Fraud as a way of life caters an extravagant banquet of consequences." (CHS 4/14/16) "Creativity = problem solving = value creation." (CHS 6/4/16) "Truth is powerful because it is the core dynamic of solving problems." (CHS 7/21/17) "We live in a system of human emotions that masquerades as a science (economics)." (CHS 1/1/18) "Always remember, your focus determines your reality." (George Lucas) "Diversity is for poor people. Sameness is for the successful." (GFB) "When power dissipates suddenly, it dissipates completely." (CHS 7/14/19) "Disobedience is the true foundation of liberty. The obedient must be slaves." (Henry David Thoreau) "Markets cannot price in the value of non-monetized natural assets such as diverse ecosystems." (CHS 7/14/19) "Magical thinking isn't optimism, it is folly." CHS 1/3/22) "Tune in (to self-reliance), drop out (of hyper-consumerism and debt-serfdom) and turn on (to relocalizing capital and agency)." (CHS 1/5/22) "The path to everything you desire starts here: like yourself as you are right now." (CHS 11/20/22) "There are only two signals: how many essentials you produce and share and if you're consuming less with better results. Everything else is noise." (CHS 12/17/22) "Liberation is no longer needing any confirmation or feedback from others or the world for one's sense of self. Wealth, fame, recognition, admiration, praise, prestige, approval, sainthood, martyrdom, success: none are needed, none are desired." (CHS 12/26/22) "When fame, wealth, prestige, status and glory are out of reach, you're free to pursue other more valuable things." (CHS 2/6/22) "It is the sacred duty of every activist who seeks to better their community to grow and share as much life-giving food as is humanly possible." (CHS 6/15/23) "Being anonymous, gray and unknown is the ideal state of freedom." (CHS 3/15/24) "We seem to have entered a world of anti-leisure and anti-productivity in which the unpaid shadow work demanded to keep all the complicated digital bits in motion obliterate our leisure and productivity." CHS (5/22/24) "It is axiomatic that failing systems work the best just before they fail catastrophically." Ray W. "Looking younger is mere technique; thinking younger demands creativity." CHS (10/16/24) "Tell me what's taboo and I'll tell you the truths that threaten the status quo." CHS (12/15/24) "This is the core of the Attention Economy: the ultimate addiction is the addiction to ourselves." CHS (1/28/25) |
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