"Too Big to Care" and the Illusion of Choice

In a functional economy with real competition and transparency, every one of these cartel-corporations would be driven out of business by their 'too big to care' incompetence.

We've all heard of Too Big to Fail, a description of the consequences of consolidating capital and power in a few corporate entities, the net result of which is monopolies and cartels becoming so large that their collapse would send the entire economy into a crisis without easy solution, as the void left cannot be filled by competitors because there are no competitors.

Given the risks generated by this consolidation of capital and power in cartels, the federal government and central bank had to bail out these systemically critical corporations in 2008, regardless of the cost or political precedent being established.

One would be forgiven for reckoning that the first thing the federal government would do post-meltdown was break up the Too Big to Fail entities as an unacceptably dangerous source of systemic risk. But the Central State did nothing of the sort, and the dominant firms in every sector of the economy have continued consolidating by snapping up competitors and start-ups and merging with other giants.

Everywhere we look, a few firms dominate each sector--the perfection of state-cartel-capitalism in which the core dynamics of open markets--competition and transparency--have been suffocated as obstacles to expanding profits and power. Eliminating competition and transparency is the unstoppable logic of increasing profits by any means available, for eliminating competition and transparency are the lowest-risk ways to increase profits without bothering to increase productivity or quality.

This consolidation into quasi-monopolies and cartels has moved from too big to fail to too big to care: these companies now occupy the commanding heights of the economy and so they have no incentive to improve quality and durability or seek efficiencies that can be passed on to customers. Rather, they have every incentive to reduce quality and durability to boost profits via planned obsolescence and disregard for customer service.

Cory Doctorow has performed distinguished public service in revealing the endless chicanery corporations pursue to cloak their stripmining of customers, customers with no alternative other than another member of the cartel that offers the same low quality, the same products and the same prices.

This is the sweet spot for profitability: customers have only the illusion of choice and the chicanery of too big to care is well hidden. Once the customer has no real choice, or they're now dependent on or addicted to a product or service, then prices can be jacked up and quality can fall off a cliff to boost profits, with no blowback.

Here is a chart of U.S. corporate profits. Note the dramatic increase. If we ask "did profits soar 50% because corporations boosted productivity and quality by leaps and bounds or were they just too big to care?"



Consider the sector that is almost 20% of the entire economy: healthcare. Here is a chart of healthcare insurance costs. Do we really have a choice of healthcare and insurance? No. We get the same overpriced meds, long wait times, bankruptcy-triggering costs and abysmal mental-health care everywhere.



Speaking of cartels, consider the rest of the insurance industry. Prices rise, policies are cancelled, coverage is reduced, and where's the competition?



The government is of course the classic monopoly, and many state agencies are equally too big to care. I've posted my chart of The Lifecycle of Bureaucracy many times in the past 14 years, and if my own experience is any guide, the dynamics of too big to care in the public sector have increased in step with corporate cartels.



Consider tech. Does any "choice" actually eliminate malicious web traffic, or offer a device that lasts a decade rather than an obsoleted-brick that must be replaced every few years, or any service that doesn't collect the same quantity of user data to sell for immense profits?

The chicanery of monopolies and cartels is literally endless: dynamic pricing to squeeze a few dollars more out of customers trapped into using different versions of too big to care Addiction Capitalism, rusting "stainless steel" that I call stainless steal, and thousands of fines and settlements for corporate malfeasance, which you can review at your leisure in the remarkable data base of Corporate Fines and Settlements from the early 1990s to the present compiled by Jon Morse.

Can we risk being honest about all this? Or does the whole house of cards collapse if we're actually honest about too big to care and the illusion of choice? The problems here are scale and concentration of capital and power: once any entity, private or state, reaches a scale and consolidation of resources / power that leaves customers / citizens no real choice, no real feedback / pushback and no real transparency on the inner workings of too big to care, then the system is ripe for collapse not from externalities but from its intrinsic instability.

Do we have any real choice in Department of Motor Vehicles, appliances, or anything else? Sure, there are dozens of toothpaste options, but we all know these are merely marketing gimmicks. The "alternative healthcare" brand is owned by a corporate conglomerate.

There is literally no bottom in the too big to care abyss. I'll share one example from my own life to illustrate this; you will no doubt have your own. The electronics in our crumbling Samsung range (rusting "stainless steel," etc.) finally failed after a few brief years of service, so we bought a new GE range from Home Depot, largely because this model was in stock.

GE shipped the new range with a defective thermostat that never worked. GE didn't care, and neither did Home Depot, which carefully refuses any warranty responsibility for the appliances they sell. When we called GE to honor their warranty and send a repair tech, the process was pre-Soviet-collapse painful--hours squandered trying to get a response via phone, online chat, emailing, none of which produced any timely results. We finally reached a staffer who took our address and scheduled a tech visit.

The day of the service call arrived and the tech texted us that he's on the way--to our address of ten years ago, 2,500 miles away in another state. After more wasted time, the customer service staffer we finally reached said their system was buggy and updating addresses generally failed.

In a functional economy with real competition and transparency, every one of these cartel-corporations would be driven out of business by their too big to care incompetence. Instead, we all move from one form of extortion and indentured shadow work to the next, regardless of sector or whether it is public or private.

Don't complain, it could be worse. "I am altering the deal, pray I don't alter it any further."



And what does too big to care and the illusion of choice do to democracy? In time, it transforms the republic into a state-corporate oligarchy.




New podcast: Seeking a Culture of Honor and Integrity with Emerson Fersch and Amy LeNoble (59 min)

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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


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What If Solutions That Worked in the Past No Longer Fix What's Broken?

You see the irony here: the more successful the old solutions were, the greater our compulsion to cling to them even as they fail.

Humans use inductive reasoning to solve problems. If a solution fixed a problem in the past, we assume it will solve the problem again. This is a rational expectation based on prior experience.

But if conditions change, the solution won't fix the problem. It might even make things worse.

The difficulty is what's changed isn't always visible or obvious. On the surface, things look the same. What's changed is buried deep in the structural machinery grinding away beneath the superficial sense of continuity with the recent past.

This describes the current global system: conditions have changed but these structural changes are not visible. On the surface, the present looks like the recent past. Yes, technology changes, but this constant churn of new technology has long been part of the system.

Make America Great Again is an explicit call to return to the solutions that worked in the past, specifically The Reagan Revolution of the 1980s, which was characterized by these policies:

1. The federal government is the problem, not the solution. The solution is to reduce the influence and financial footprint of the federal government.

2. Deregulation of private industries, starting with finance. Loosen regulations to enable financial / market solutions, even if they're disruptive.

3. Focus on growth. Grow the economy by loosening up credit, drill baby drill, reducing regulatory burdens and taxes, etc.

4. Pursue a muscular global policy of America First. No more wishy-washy playing nice: choose sides, but choose carefully because there will be consequences.

5. It's morning in America. We can get back on track by unleashing America's native optimism and vigor.

These solutions from the past are compelling because they delivered decades of growth. Of course reality is complicated, and it wasn't just these policies by themselves that spawned decades of expansion. Demographics, the "peace dividend" and many other factors helped.

And there were spots of bother: deregulation enabled the Savings and Loan debacle in which a third of the nation's S&L associations closed as $180 billion went up in smoke, losses that cost taxpayers $132 billion in bailouts.

Beneath the political rhetoric, these policies boil down to Keynesian stimulus which has been the de facto go-to policy "fix" for 60+ years: loosen credit, increase government borrowing and spending, encourage risk-taking and "animal spirits."

As for regulations, the machine increases regulatory burden until it is restrained politically. Unproductive dead-weight regulations pile up along with the occasional regulation that serves the public interest. Sorting out the unproductive regs from the useful regs is tedious, and so private interests "help" by lobbying to get rid of whatever was inhibiting their expansion into malfeasance and fraud, and then we end up with the S&L debacle in the late 1980s and the Global Financial Meltdown of 2008.

Then the political machine rushes new regulations into law. The pendulum swings back and forth.

Political realities are glossed over to fuel optimism for "hope and change." No politician ever wins re-election by reducing the federal budget. This is an abstraction we claim to care about but in the real world, we care more about decaying bridges where we live, the cost of medications, whether jobs or plentiful or scarce, etc., and so politicians win re-election by sluicing federal funding to repairing the bridge, reducing the cost of medications and funding the defense plant making weapons the Pentagon didn't want but Congress loved because "defense spending" is viewed politically as a jobs program.

This process cannot be repealed. Congress controls the government's purse strings, and when re-election comes around then slashing $2 trillion in federal spending will mean defeat and a loss of power. Not many politicians will fall on their sword, and for those who do, to what purpose? Whomever replaces the politician will pursue the same "guns and butter" free-spending budgets that the new leadership vowed to slash and burn.

Beneath the surface, things have changed structurally, and so the tried-and-true solutions won't work as they did in the past. Our inductive reasoning will slip into magical thinking, and we'll think that the reason the past solutions aren't working as anticipated is that we're not pursuing them vigorously enough, so we do more of what's failing.

Magical thinking then slips into denial: the old solutions are working, we just have to do push harder. The problems that the solutions were supposed to fix get worse, and we refuse to change course because we don't have any other solutions in the toolbox except the old solutions that no longer work.

You see the irony here: the more successful the old solutions were, the greater our compulsion to cling to them even as they fail. This clinging strikes us as completely rational: these solutions worked like magic, they will work again in the same way, it's cause and effect. But conditions beneath the surface illusion of continuity with the past have changed, and so the effects are different.

While we're focusing on the first-order effects, the second-order effects are melting the buffers we assumed were permanent and forever. Once the buffers are gone, we're forced to admit the solutions we were confident would work didn't work, and due to our confidence and unwillingness to admit they weren't working, it's too late to stave off collapse.

What if solutions that worked in the past no longer fix what's broken? We're too busy doing more of what's failed to forge new tools that might fix what's broken--but there's no guarantee of that, either, if we misdiagnose the problem.




New podcast: Seeking a Culture of Honor and Integrity with Emerson Fersch and Amy LeNoble (59 min)

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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


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A Christmas Gift from Marcus Aurelius

"Whenever you want to cheer yourself up, consider the good qualities of your companions."

We turn to Marcus Aurelius for the realistic wisdom of stoicism, but he has another gift to offer us. What's striking--and rarely discussed--about his Meditations (free online text) is the nature of the first chapter of the book.

Book One is a lengthy and heartfelt expression of gratitude to those who taught and nurtured him. It begins with these lines:

"From my grandfather Verus I learned good morals and the government of my temper.

From the reputation and remembrance of my father, modesty and a manly character.

From my mother, piety and beneficence, and abstinence, not only from evil deeds, but even from evil thoughts; and further, simplicity in my way of living, far removed from the habits of the rich."

Marcus then extends his gratitude to all those who helped and guided him.

"From Rusticus I received the impression that my character required improvement and discipline.

From Apollonius I learned freedom of will and undeviating steadiness of purpose; and to look to nothing else, not even for a moment, except to reason.

From Sextus, a benevolent disposition, and the example of a family governed in a fatherly manner, and the idea of living conformably to nature; and gravity without affectation, and to look carefully after the interests of friends, and to tolerate ignorant persons, and those who form opinions without consideration.

From Alexander the grammarian, to refrain from fault-finding, and not in a reproachful way to chide those who uttered any barbarous or strange-sounding expression.

From my brother Severus, to love my kin, and to love truth, and to love justice.

From Maximus I learned self-government, and not to be led aside by anything; and cheerfulness in all circumstances, as well as in illness; and a just admixture in the moral character of sweetness and dignity, and to do what was set before me without complaining.

In my father I observed mildness of temper, and unchangeable resolution in the things which he had determined after due deliberation; and no vainglory in those things which men call honours; and a love of labour and perseverance.

To the gods I am indebted for having good grandfathers, good parents, a good sister, good teachers, good associates, good kinsmen and friends, nearly everything good. Further, I owe it to the gods that I was not hurried into any offence against any of them, though I had a disposition which, if opportunity had offered, might have led me to do something of this kind."

As with everything of value, gratitude has been commoditized into an empty, ersatz expression of virtue-signaling for public consumption, a canned commodity delivered like a product from a factory in every speech given by the winners of the game: I'm grateful for Coach, my teammates, and so on, punching the "gratitude" ticket for public approval.

Authentic gratitude is private, a meditation on the sacrifices made by others on our behalf, offerings of life experiences and understanding. This gratitude is a gift we can give ourselves, and others.

Consider the grace and gratitude in this advice from Marcus Aurelius:

"Whenever you want to cheer yourself up, consider the good qualities of your companions, for example, the energy of one, the modesty of another, the generosity of yet another, and some other quality of another; for nothing cheers the heart as much as the images of excellence reflected in the character of our companions, all brought before us as fully as possible. Therefore, keep these images ready at hand."



New podcast: Seeking a Culture of Honor and Integrity with Emerson Fersch and Amy LeNoble (59 min)

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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

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The Core Skill Going Forward: Frugality

Speaking of lean years, it took the NASDAQ stock market index almost 17 years to recover its March 2000 high of 5,048.

The core skill going forward--frugality--is largely a forgotten skillset. So let's examine frugality.

Conspicuous waste is part and parcel of conspicuous consumption, which is a signifier of wealth and status. The more one wastes, the higher the status, as waste implies "I'm so rich, I can waste as much as I want."

This reach for status by consuming (and wasting) more is the engine of the waste is growth Landfill Economy.

In good times, when jobs, stock market/real estate gains and credit are all plentiful, even those with average income earn enough to waste money, food, etc. Even though we complain about the high cost of food now, there is little evidence that we're no longer wasting up to 40% of the food we buy / order out.

In a deep, prolonged recession, jobs, capital gains and credit become scarce, and so we have less to spend, and so frugality--eliminating waste and superfluous spending--is either incentivized or forced by necessity: forced frugality. TINA is the first source of frugality: there is no alternative.

(So you wanna be a writer? First take a vow of extreme poverty / frugality.)

Frugality has another source: the desire to save income to invest in long-term goals via careful planning. It's well established that the difference between "rich" and "poor" in middle income brackets is deferred gratification, the ability to defer consumption today (instant gratification) to serve long-range goals, such as buying a house or saving for a child's education.

A third source of frugality is genetics. Some of us are naturally frugal by nature, others naturally profligate. What others consider normal--throwing out the leftover rice in the pot because eating leftovers is for poor people--is absolute anathema to us.

Others mock those of us who save plastic bags and rubber bands, while for us it's second nature: why throw something away that can be re-used? We save random screws in a jar (a real treasure for handy people), smoothed out wrapping paper and scraps of wood. Composting kitchen waste is second nature. And so on. (You want to see my collections of stubby pencils, extra screws and plastic bags?)

Cultural values are another source of frugality. It's common for the third generation to remark on the extreme frugality of their grandparents from The Old Country, with the implication that poverty-induced frugality no longer makes sense in The Land of Plenty.

A fifth source of frugality is ideological / ethical: 1) waste is a sin, and 2) wasting one's income enslaves one to the grindstone of the debt-serf / wage slave status quo. From this perspective, frugality is necessary to be free.

As I've noted in previous essays, frugality and self-reliance were core tenets of the Counterculture of the 1960s and 70s. Yes, sex, drugs and rock-n-roll received the wide-eyed, sensationalist media coverage, but escaping servitude to The Establishment by learning how to do things for oneself and being frugal were core to the Counterculture. I discussed this in Access to Tools, Tools for Living: 50 Years of Forgetting https://charleshughsmith.substack.com/p/access-to-tools-tools-for-living

The book How To Live On Nothing by Joan Ranson Shortney sold thousands of copies in the 1960s and 70s. (You can find a used copy on eBay). It makes for interesting reading now because its entire point of view and value system is so alien to the present-day zeitgeist, which we can describe thusly: 100,000 smart, well-paid people are working feverishly every day to break down our deferred gratification and persuade us to impulse-buy something at full price.

Another 100,000 smart, well-paid people are working feverishly every day to trigger our innate desire to enhance our status with a costly signifier of consumption that we can brag about on social media: look at me!

An even larger army of smart, well-paid people are working feverishly every day to make us believe that "buying now" will "save us money" because "this deal won't last."

Frugality and consumption are relative, of course. If you've been living in a pup tent in a field without running water or electricity for weeks (as we did), then moving into a plywood shack (ahem, a micro-home) you built with hand tools is the acme of luxurious living: life is good, and looking up.

If you've been evicted from your foreclosed mansion on the golf course and are offered a plywood micro-home as your replacement living arrangement, your reaction will be considerably different.

In the old days, eating out was a luxury reserved for birthdays or the once-a-year family vacation. Fast food, snacks or a soda were luxuries enjoyed a few times a year. Now we consider eating out multiple times a week as a birthright, and giving that up a hardship that's beyond bearing.

What is frugality? We can start with a simple dictum: waste nothing. Food costs less when none is wasted.

We can then ask: what is the bare minimum we need to survive? Those struggling with everyday life in the wake of Hurricane Helene offer an object lesson to the rest of us. Frugality is both stripping life of non-essentials and also making sure we have the real essentials on hand. This takes planning and preparation.

Another useful question: what expenses can I eliminate as the means to meet larger goals?

A related question: what can I learn to do for myself so I don't have to pay someone else to do it for me?

What is the point of frugality? Is it all about saving money? Or is it really about freedom from the invisible shackles of conspicuous consumption and a burdensome sense of entitlement? Or is it about the confidence of knowing how to do a great many things, and knowing we can get by on much less?

Perhaps it's also about authenticity. There's something artificial about relying on conspicuous consumption for one's identity and sense of self. No longer caring makes one "poor" in appearance but rich in invisible ways.

I don't think frugality is about not spending money per se. It's about focusing on building a foundation we own, control and maintain of life's essentials, a sense of self disconnected from consumption and freedom from want, debt and servitude.

Frugality is a value system, a lens to view the world and a set of skills that become increasingly valuable should the good times fade and the seven lean years begin. I discuss this in my book Self-Reliance in the 21st Century.

Speaking of lean years, it took the NASDAQ stock market index almost 17 years to recover its March 2000 high of 5,048. That high wasn't reached until October 31, 2016. Adjusted for official inflation (i.e. lower than real-world inflation), the index needed to top 7,358, a level not reached until January 2018--18 long years after its euphoric bubble peak in the dot-com era (AI! Oops, sorry, that's today's euphoric bubble.)



Bubble symmetry suggests a retrace of the current NASDAQ might finally hit bottom around 2032, seven long years ahead. Yes, yes, this is "impossible," as the Federal Reserve will never let it happen, but the Fed was very active in 2000 to 2003, and the NASDAQ still lost 80% of its value.



Perhaps we should add a sixth source of frugality: the evaporation of all the phantom wealth inflated in speculative credit-asset bubbles.


New podcast: Seeking a Culture of Honor and Integrity with Emerson Fersch and Amy LeNoble (59 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

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The Economy Has Failed the American People, But It's Taboo To Say Why

Addiction, illness and derangement are all immensely profitable, along with monopoly, cartels and collapsing quality.

The economy has failed the American people, but it's taboo to say why because that would undermine the entire power structure that so richly benefits the few at the expense of the many. The few have an extremely compelling motivation to obscure the "why" and to enforce the taboo on saying it aloud.

The economy has failed the American people because it's a two-tiered power structure that's essentially neofeudal, meaning it's an updated version of traditional feudal social orders. To understand this, we must start by understanding traditional feudalism.

In feudal societies, life is pretty good for the nobility in the castle on the hill. For the powerless peasants working the fields below to fund the nobility, life is less good, and so the peasantry is open to changing this asymmetric power structure to a fairer balance.

To maintain its grip on power, the nobility must promote a social zeitgeist in which the peasantry's powerlessness is the natural order of things and therefore resisting this structure is not only a sin, it's futile.

One key feature of feudal social orders is the impermeability of the line between nobility and peasantry, what we call social mobility. Nobility and serfdom were established at birth, never to change. Serfs were bound to the land of their birth and could not leave; their servitude was for life.

This was a regression from the Roman Empire, which allowed ownership of land by free citizens, and relatively free movement of citizens throughout the vast empire.

Wedged between these hereditary classes were the merchants and craft workers whose services were essential to the nobility's maintenance of power. As Fernand Braudel documented in his massive three-volume series Civilization and Capitalism, 15th-18th Century (Vol. 1: The Structure of Everyday Life, Vol. 2: The Wheels of Commerce, Vol. 3: The Perspective of the World), the story of capitalism is the steady expansion of commerce and production eventually generated a class with sufficient power to unseat the feudal power structure and replace it with various flavors of capitalism.

Another key feature of feudalism is the union of state and ownership of capital: there is only one nobility. The nobility owned the productive capital--mostly land, but also toll roads and other assets--and they were also the government: each fiefdom ruled its peasantry and controlled whatever judiciary was available.

The Catholic Church provided a separate power structure that interacted with the secular feudal structure in complex ways, as it owned vast tracts of land and was powerful enough to impose some counterbalancing measures on the nobility--for example, imposing numerous religious holidays for the peasantry. The church held religious authority and wealth via its monasteries and papal hierarchy, and the remarkably complex history of the Holy Roman Empire illustrates the interweaving of these church-economic-political structures.

The church also provided cover for feudalism, by promising the peasantry just rewards in the afterlife for their faith and acceptance of the status quo in this life.

The key to understanding the current neofeudal structure of our economy is to recognize the taboos against describing this structure publicly. The present-day nobility--as in classical feudalism, one class that holds both economic and state power--exerts tremendous sway via its control of media and technology, i.e. the tools of propaganda / influence.

The present-day nobility glorify a staged play in which free-market entrepreneurs battle oppressive government. The purpose is to mask the reality that our nobility is one class: the controls of state and capital are in the same hands. Who did Hank Paulson--former CEO of Goldman Sachs, then Secretary of the Treasury -- call in the 2008 financial meltdown? Warren Buffett. And so on.

These tools are deployed to obscure the neofeudal realities with euphoric (and often delusional) claims of Technology-Driven Progress-- everything's getting better every day, in every way, we're all richer in every way, don't you see all the wonders dazzling us daily?

This is simply not true. As I documented in The Big Shining Lie: We're Better Off Now--No, We're Poorer, Much Poorer, the purchasing power of wages has declined for decades, forcing wage earners to borrow money or speculate in asset bubbles to fill the gap opened by the erosion in the value of labor.

The balance between labor and capital has shifted to favor capital over the past 50 years. The owners of capital have benefited mightily, reaping vast gains in unearned income and capital gains, while those "owning" hours of work have seen the purchasing power of an hour's wage collapse, a collapse masked by the easily gamed charade of "inflation."

As I explained in All Three Pillars Holding Up the Economy Have Cracked, the three mechanisms used to fill this gap--government subsidies, cheap credit and asset bubbles--are all self-liquidating systems due to their inner dynamics. Simply put, debt eventually consumes all the seed corn, and all asset bubbles pop.

As for Progress, the reality is the American people have experienced the opposite of Progress, what I term Anti-Progress across the entire spectrum of everyday life. Our life expectancy is plummeting, and not just from Covid. The rates of cancer in young Americans is skyrocketing, 53% of the adult populace is diabetic or pre-diabetic, with horrendous consequences, and the solution presented by the nobility isn't the source of this catastrophic collapse of public health--manufactured junk food and unhealthy lifestyles shaped by Addiction Capitalism--the more we addict you, the more you buy--but by pushing the government to pay tens of billions of dollars for weight-loss medications with numerous (generally under-reported) side effects.

In the upside-down world of Addiction Capitalism, every addictive device and product is glorified for its addictive nature. The little addiction stimulation device that we all carry and obsessively check 300 times a day is a wonderous "tool" for communicating--yeah, communicating derangement and addiction.

That our lives are consumed by shadow work imposed on us by corporations and the state is ignored in the frenzy of techno-hype. The fact that AI is reducing the quality of what little customer service is available--just another manifestation of the controlled demolition of quality and durability that Corporate America relies on to boost profits--never mind, AI is changing your life by, well, um, enabling the rapid expansion of malicious emails, SMS, worms, spam, etc.

The implicit message is that Progress is measured by two things--rising corporate profits and soaring stock valuations. AI is great because the companies are worth hundreds of billions of dollars. Sugary, fat-soaked snacks are great because "you can't just have one" and they're immensely profitable.

As for social mobility, it's also over-hyped to mask the reality. With the right combination of talent, drive, family assets and luck, it's possible to ascend from powerless peasant to well-to-do merchant or professional supporting the status quo with one's labor and taxes, and a handful of super-glorified go-getters reach the nobility, but these are Cinderella stories that promote the illusion of a porous border between classes.

Meanwhile, back in the real world, life is becoming more precarious, stressful, demanding and deranging even as we're pounded with hype glorifying profitable Progress that isn't actually progress. The inevitable result of this disconnect between the ceaseless hype of Technology-Driven Progress and our lived experience, and the widening gap between the value of labor and the value of capital, is the fabric of society starts unraveling, something that is obvious but also taboo to describe accurately, as a self-reinforcing feedback where each thread that unravels takes two adjoining threads with it.

Anyone breaking the taboos against describing the neofeudal nature of our economy, Anti-Progress, Addiction Capitalism and the profitable decline of quality and durability is instantly slammed as a secular sinner in the religion of Technological Progress. How dare you question the endless bounty of technology, how dare you declare our "god," technology, is a tool of control and addiction, a chimera of prosperity projected on billions of screens.

The indignation of the promoters is in direct proportion to their fear that we'll see through the artifice and awaken to neofeudalism's inevitable decay and collapse. Addiction, illness and derangement are all immensely profitable, along with monopoly, cartels and collapsing quality.

For goodness sakes, don't abandon junk food and fast food for home-cooked meals made with real food--demand the government give everyone hundreds of billions of dollars of weight-loss meds with horrific side effects:



We got your social mobility right here. The vast majority of the top-tier elites in both public and private sectors (remember, there's only one nobility) attended two universities, not for the education but for the opportunities offered by networking:



Nothing says "progress" quite like this chart of social-media dominance....




...and this chart of loneliness. Gosh, could these be related?



The nobility obfuscates its nature with a profusion of sub-classes: dukes, princes, earls and so on in the old days, as if anything matters but the stark division between the nobility and its well-paid class of enablers, and the powerless peasantry watching the pageantry with an unsettling mixture of admiration and alarm.

Tell me what's taboo and I'll tell you the truths that threaten the status quo. As in Kafka's novel The Castle, the nobility's power structure is obscured, and the castle is bustling with activity--but very little productive results of this 24/7 activity ever waft down to the impoverished residents of the village.


New podcast: Seeking a Culture of Honor and Integrity with Emerson Fersch and Amy LeNoble (59 min)

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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


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All Three Pillars Holding Up the Economy Have Cracked

All three pillars propping up workforce spending are cracking. Plan accordingly.

Karl Marx and Henry Ford both understood the key pillar of an industrial economy: the workforce has to earn enough to buy the output of the economy. If the workforce doesn't earn enough to have surplus earnings to spend on the enormous output of an industrial economy, then the producers cannot sell their goods / services at a profit, except to the few at the top as luxury goods--and that's not an industrial economy, it's a feudal economy of very limited scope.

Marx recognized that capitalism is a self-liquidating system as capital has the power to squeeze wages even as the output of an industrial economy steadily increases due to automation, technology, etc.

Henry Ford understood that if his own workforce couldn't afford to buy the cars rolling off the assembly line, then his ambition to sell a car to every household was an unreachable chimera. (There were other factors, of course; the work was so brutal and mind-numbing that Ford had to pay more just to keep workers from quitting.)

If we say the three pillars holding up the economy, the conventional list is: 1) consumer spending (i.e. aggregate demand); 2) productivity and 3) corporate profits. These are not actually pillars, they are outcomes of the core pillar, wage earners making enough to buy the economy's output.

As the statistics often cited here show, the purchasing power of wages has been declining for almost 50 years, since the mid-1970s. This means the workforce's surplus earnings have bought less and less of the economy's output.

There are three ways to fill the widening gap that's opened between what the workforce has to spend as surplus earnings and the vast output of the economy:

1. Government distributed money. The government distributes "free money" to the workforce via subsidies, tax cuts and credits, or direct cash disbursements.

2. Cheap abundant credit. The cost of credit is lowered to near-zero and credit is made available to virtually the entire workforce so workers can borrow money to buy goods and services they cannot afford to buy from surplus earnings. If auto loans are 1.9%, the interest is a trivial sum annually.

3. Asset bubbles. Boost the value of assets via monetary policies to generate unearned "wealth" that can be spent (by either borrowing against the newfound wealth or by selling assets). This expansion of "free money" also generates the "wealth effect," the feel-good high of feeling richer, which increases the confidence and desire to spend more money.

There are intrinsic, unbreachable limits to each of these solutions.

1. The government either "prints" or borrows the money it distributes to the workforce. Over time, low interest rates are unsustainable, despite claims to the contrary, and the interest paid on the state's vast borrowing consumes so much of the state's revenues that it starts limiting how much the government can spend. Once state spending stagnates or declines, this pillar breaks and the economy crumbles into recession / depression.

In other words, depending on the government to fill the gap between wages and the economy's output is a self-liquidating system.

2. The expansion of credit leads to defaults and bankruptcies. Relying on the ceaseless expansion of credit based on the declining purchasing power of wages is also a self-liquidating system, as the number of marginal borrowers steadily increases, as does the volume of marginal loans issued by lenders. Marginal borrowers default, triggering losses that push lenders into bankruptcy. This is a self-reinforcing cycle, as the economy rolls over into recession as credit contracts. More workers lose their jobs and default, more loans become uncollectible, and so on.

3. Asset bubbles concentrate the newfound wealth in the top 10%, exacerbating wealth-income inequality and pushing those left behind to gamble in an increasingly speculative financial sector as the only available means of getting ahead. Speculation is also a self-liquidating system as risky bets eventually go bad and the losses trigger a self-reinforcing feedback of selling assets to raise cash which then pushes valuations lower, triggering more selling, and so on.

All three of these pillars propping up the economy are self-liquidating systems, and they're all buckling. Federal borrowing is pushing up against the limits posed by the interest payments on soaring debt. Credit costs are rising and cannot return to near-zero due to inflationary forces. All asset bubbles eventually pop, and the higher they ascend, the more devastating the collapse.

Wages' share of the economy have been in structural decline since 1975:



Federal debt: and no, we can't "grow our way out of debt" by inflating asset bubbles and subsidizing consumer spending with federal debt:



Total debt, public and private: the acme of a self-liquidating system:



The pillars of consumer credit and federal borrowing are reaching intrinsic breaking points, and so everything is now depending on the asset bubbles in housing and stocks to keep inflating phantom wealth at rates high enough to support more borrowing and spending.

The problem is all asset bubbles pop, despite claims that "this is a new era." That was widely held in March 2000, too, just before the dot-com bubble burst and the Nasdaq fell 80%.



All three pillars propping up workforce spending are cracking. Plan accordingly.


New podcast: Seeking a Culture of Honor and Integrity with Emerson Fersch and Amy LeNoble (59 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


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Subscribe to my Substack for free

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Truth, Beauty and the Unseen Craftsperson

I think of Bill whenever the breeze brings his chimes to life.

Today I want to honor Bill Murath, a friend and fellow craftsperson who recently passed away from AML. (Acute myeloid leukemia). Like the vast majority of those I have come to know through countless emails, Bill and I never met in the physical world, but we bonded in the realms of spirit and craft. Bill was a unique spirit and gifted craftsperson.

Bill was a father, husband, business owner and musician, and in his younger days, a surfer who lived on the North Shore of Oahu and worked in a pizza shop to fund his surfing. I know the North Shore well and when I see a photo of him on his board, in my mind's eye I am swimming beside him.

Bill and I go way back.

When he read my post When an Old Friend Takes Her Own Life (December 1, 2007), he responded by making two wind chimes of craft and beauty, which he mailed to me in remembrance of my dear friend.

That Bill understood my loss and responded by investing his time, skill and artistry in making a gift that continues to enrich my life every day--how can I express my gratitude?

I asked what I could do for him in return, he shrugged. It was a gift. When I asked him to explain how he designed the length of each chime to achieve the various tones, his explanation went over my head.

I've learned to avoid discussing beauty in my public posts because it inevitably draws the ire of those anxious to accuse me of elitism, as the mainstays of American culture are "beauty is in the eye of the beholder," i.e. entirely subjective; "only elites can afford beauty," i.e. fine art / costly objets d'art that serve as signifiers of wealth and status, and "aesthetic sensibility is snobbery," so to recognize beauty is verboten.

This is a misunderstanding of the meaning of craft, which is an expression of truth and beauty that is not subject to fads or opinion.

I too am a craftsperson, but of a different sort than artists like Bill. My craft is purposefully unseen, invisible, as my skill is in doing work that goes unnoticed because it blends in with what is already there.

Bill understood the Tao of craft. If you read Zhuang Zhou (Chuang Tzu in a previous era), you'll find stories of butchers whose blade never dulls because they never hit bone, and masters who catch birds with sticks. These stories reflect that the Tao flows as skills mastered by years of discipline and effort, as the result of experience with unique situations with uncertain solutions--precisely what is beyond the reach of machines and AI, despite overblown claims to the contrary.

Though our culture claims to glorify beauty, it actually glorifies ugliness. This is why it's so verboten to even discuss beauty, for that would inevitably lead to a recognition of the sea of ugliness.

To those imbued with the Tao of craft, there is immutable truth in the materials we work with. This truth is not subjective; we feel it as our second nature. The same holds for beauty: if the work is done right, it has beauty on multiple levels that is not a matter of opinion.

This immutability is offensive to those who claim equal rights to "decide what's true and beautiful." The craftsperson knows from long experience, in a way the opinionated non-master-craftsperson cannot.

A machine can mix pie crust dough, and the result is low quality because there is a craft mastery to a truly wonderful pie crust. The master baker knows just how much water to add by the feel of the dough, which is partly based on the humidity and temperature of the environment. The feeling of rightness cannot be measured by instruments or taught online; it must be acquired by long experience of trial and error in unique circumstances with uncertain solutions and outcomes, what author Donald Schon called "reflection in action."

This training is never complete, of course, but the practitioner reaches a point of natural confidence that the ignorant mistake for pride or superiority. The practitioners sense the truth of the materials and the path to beauty.

My own experiences this year illustrate the point. I replaced several delaminating interior doors in a 50-year old house. I had to trim the doors to fit the opening, drill a hole for the existing lockset, and so on. The tricky part wasn't the carpentry, it was the finish. The existing doors had been "blonded," a process of rubbing white paint over the veneer and quickly wiping it off. The same technique had been applied to the tongue-and-groove redwood wall boards.

The technique looks easy, and it is, unless you're seeking to match an existing set of doors that have aged with time. Then the trick is to know how long to let the paint soak in and when to wipe the excess off so it looks like the older doors. If you wait too long, the paint dries and the finish is uneven. If you wipe it off too soon, then it's visibly lighter than the older doors.

The goal is to replace the doors in such a way that casual observers don't see the new doors as replacements.

In the same house, an old pipe had been removed long ago in the bathroom and the hole had been filled with an ugly wood plug. There is no way anyone could claim this plug was anything but ugly. So I used a couple of tricks and mixed up several shades of paint to match the existing linoleum flooring. The casual observer won't see it.

A spot of dry rot on an exterior window frame turned out to be a fist-sized sponge of rotted wood that included some of the siding, frame, sill and trim. A robot would have opted for the "obvious" solution which was replacing the entire window frame, window and siding--a job that would cost a lot of money. I knew this was unnecessary and so I set the blade depth of our wormdrive Skilsaw and free-handed a surgery which I completed with a hammer and chisel.

Firing up a Skilsaw to free-hand cut away parts of the window sill, frame, trim and siding of a single-wall house demands a certain level of experience, as each such job is unique. It's not a factory environment. The saw weighs 13 pounds, it's threatening to rain so there's a pressing time element, the ground is uneven and the tool is inherently dangerous. A YouTube video isn't going to give you the skill that only experience provides. It boils down to the feel you have for the blade and the wood.

This is the craft. It becomes part of you, a second nature called up as needed, for your hands do the work "all by themselves," without conscious guidance. Your mind isn't wandering, it's observant, but no more than that. You let the work get done by staying out of its way.

Again, the truth is in the materials: you sense the density and soundness of the wood by the feel of the chisel. The beauty is in the invisibility of the repair, which required fashioning three small complex multi-cut pieces of new wood with a chisel and a hacksaw, as the blade is finer than our handsaw.

I think of Bill whenever the breeze brings his chimes to life. My craft is not up to his, but given my 50 years of experience, I can recognize and honor his achievement, and admire the truth and beauty of his craft and life.

I miss you, Bill.

Here are photos of his chimes, and a brief recording of one.

One holds court in a corner of our kitchen, where it catches the tradewind breezes from the dining nook windows. It is a musical "kitchen god" for those familiar with Chinese traditions.



The other holds court in our living room, where it comes to life in the tradewinds wafting through the windows overlooking our yard. That it shares the space with our very old embroidered dragon seems appropriate.



This book helps us understand Bill's level of craft. The Unknown Craftsman: A Japanese Insight into Beauty (1972)


New podcast: Seeking a Culture of Honor and Integrity with Emerson Fersch and Amy LeNoble (59 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


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The Big Shining Lie: We're Better Off Now--No, We're Poorer, Much Poorer

This is proof-positive we're not just poorer now than we were 40 years ago, we're much, much poorer.

Armies of well-paid apologists, apparatchiks and propaganda peddlers--economists, pundits, statisticians, influencers--spend their entire careers pushing a big shining lie; we're more prosperous now than ever before. This is demonstrably false, as the truth--that we're much poorer than we were 40 or 50 years ago--would disrupt the status quo in which the few at the top get to control the narratives and wealth as long as the masses believe the propaganda that we're all better off.

This is the reason why the four-decade collapse of the purchasing power of wages must be papered over with propaganda and gamed statistics. If we accept the reality of our declining standard of living and well-being, then a few reforms will be recognized as insufficient; we'll awaken to the necessity of a Reformation, not just a handful of standard-issue policy tweaks.

Inflation statistics are easily gamed. So are statistics such as median wages. Official inflation is gamed by various statistical tricks (hedonics and what's in the price basket) to understate the real-world decline in purchasing power.

There is only one true measure of prosperity: the purchasing power of an hour's labor / wage. It doesn't matter what the wage or price numbers are, what matters is: how much can you buy with an hour's wage?

Fact: in 1977, it took 2.25 days of work (18 hours) to pay the monthly rent on my studio apartment in the most expensive city in the U.S., Honolulu. In virtually any other city or town, the rent would have been less. I was 23 years old, working as a non-union apprentice carpenter for a small contractor. The pay was a bit above average, but by no means fabulous. I wasn't working at Goldman Sachs. The rent was fair market; it wasn't some special deal offered by a relative.

Since this was a cheap apartment, let's round that up to 3 days of work to pay the monthly rent.

OK, so how many young wage earners today can pay the rent for their own apartment with 3 days' pay? Any hands? OK, the Ivy League MBA working at Goldman Sachs, making mega-six-figures in annual compensation. Any average folks out there paying their rent with 3 days' pay? No?

Today, that would require an hourly wage of $60 to $90 an hour. The median annual wage is around $60,000, around $30/hour--half or a third of what it takes to pay the rent on a studio apartment in a high-cost urban area with 3 days of work.

It's important to understand that I didn't have the only cheap apartment in the city. Most of my friends had similar cheap housing, because there were more nooks and crannies in the housing market and in the economy: more small landlords and lower costs of doing business. One friend rented a converted WW2-era Quonset hut on the edge of an upscale neighborhood. Another lived in an old apartment next to the freeway. Another rented an in-law cottage in a single-family home neighborhood. I rented a wealthy couple's poolside cabana for a year. (Most of the space was filled with their stuff, but the price was right.)

Much of this low-cost housing has been demolished or rehabbed into high-priced rentals.

Fact: in 1985, it took about four hours of work to pay my individual healthcare insurance premium for the month ($54). This wasn't phantom insurance with a huge deductible--it was the standard insurance offered by employers large and small. Being self-employed, I paid the premium myself.

OK, everyone who can pay a market-rate, non-subsidized, non-giant-deductible monthly healthcare insurance premium (for an individual) with good coverage with 4 hours of work, raise your hand. With an average cost around $350 a month according to reputable sources, that requires a wage of $87 an hour--roughly triple the median wage.

Costs were lower across the board: my monthly utility bill: two hours of work. Three full lunches at a working-class cafe--one hour of work. And so on. The key takeaway here is that the cost of doing business was lower across the board, so everything from auto repairs to going to the dentist was much cheaper. Compared to the present, it took very few hours of work to pay for auto repairs, dental work and other services.

We're told our vehicles are so much better now, but this too is open to debate. Cars and trucks cost a fortune now, and they're bigger and heavier and dependent on electronics that can't be repaired at home and that are super-costly to repair. And what exactly makes them so much better? Recall that we all managed to get by without rearview cameras and hands-free mobile phone technology for decades. Let's look at vehicles as transport, not rolling entertainment centers.

My 1979 Honda Accord (bought used for $2,600 ($7,350 in today's dollars) operated for many years with little more than routine maintenance despite being 8 years old when I bought it. It got about the same mileage (40 MPG) as my current 2016 Civic, which has a bigger engine and is much heavier. Is it a "better" vehicle given that repair estimates of $3,000 or more are now the norm? I could still replace a defective sensor in my 1998 Civic myself. Now--forget it.

In terms of repairability, modern vehicles are off-the-scale worse than the highly reliable vehicles of 30 or even 40 years ago.

Given the impossibility of doing much more than changing the oil at home and the insane costs of repairs, it's clear that the hedonics aren't worth the stupefying increases in costs. The same can be said of the 4-cylinder pickup trucks of that era, which did the same work as the far larger, far more costly and unrepairable trucks of today that cost $80,000. How many hours of work does it take now to own and operate a vehicle? Far more than in the past.



In the 1980s, I paid my annual home insurance with a few days' labor. Is that possible now? Sure, if you make $80/hour. Even at that rate, it takes a couple weeks' earnings to pay home insurance in some areas. And yet we're all more prosperous now?



How about the cost of building a new home? In the early 1980s, I built my own 1,400 square foot conventional house with a two-car garage for $26,000, which equates to about $90,000 in today's dollars. It took 2,600 hours of work to pay for my house in full (not counting my carpentry labor). I performed all the labor other than the licensed subcontractors (electrical, plumbing, cesspool excavation, carpet installation, etc.).

Can an owner-builder construct the equivalent house today for 2,600 hours of work? At $30/hour, that's $78,000. Good luck building a middle-class house turnkey (all appliances, flooring, etc.) for $78,000, even if you do all the carpentry yourself. That might cover the materials--but maybe not.

Around this same time (1983) I built numerous modest starter homes as a fully licensed and insured contractor for under $35,000, which equates to $110,000 in today's dollars. Compare this to today, where you need a construction loan of $400,000 to build a nothing-special middle-class house.

Are the houses "better" today? In terms of the quality and durability of materials and appliances, they're worse. The materials today are low quality, as are the appliances. 30 or 40 years ago, you could buy a fridge, washer, stove/oven, etc. and it would last decades. Now, all I hear are accounts of costly appliances failing in a few years--and that's been my experience. Today's lumber is lower quality, too, as is the hardware. Standard (i.e. not fancy-expensive) locksets in 50-year old houses are still untarnished and working fine. Modern hardware is--sorry to be blunt--mostly rubbish.

Meanwhile, as the costs in hours needed to pay for essentials have soared, we're told by apologists and propaganda pundits that cheap TVs and clothing have offset the the collapse of our purchasing power. Does anyone else find this ceaseless spew of lies irksomely misleading?

The collapse of quality has stripped away the purchasing power of earnings. Two generations ago, you could buy just about anything you needed used for a low cost, and that product would last for years or decades. My Mom bought a "vintage" dining set in 1970 that supposedly came around the Horn. Given the square nails and other indicators, I would estimate it was 100 years old at that time. I still use it today, so it's 150 years old. I've reglued some of the chairs, but other than that, they've been zero-cost for 50 years.

Are the chairs being bought today at Ikea going to last 150 years? I've repaired many that fell apart in the first year. The same can be said of almost everything being manufactured today. This collapse of quality has dramatically reduced the purchasing power of wages in fundamental ways.

Then there's this chart: wages' share of the economy, which has dropped from 51.6% in 1975 to 43% today. Given that the U.S. GDP is $29 trillion, each point of that decline translates into major money. 8% of $29 trillion is $2.3 trillion. Now there are various ways to measure this, but you get the point: wage earners are receiving a smaller share of the economy's output.



How many hours of work does it take to buy essential products and services now, and how long do the products last? By this measure, we're poorer, much poorer. After paying for essentials, we have less disposable income available to save or spend on non-essential stuff.

In the mid-1970s, I was having lunch with two older buddies. One was a public school teacher (he taught science) who'd served in West Africa in the Peace Corps, the other was an ex-Marine officer who'd served boots on the ground in Vietnam. Both agreed that if anyone was serious about achieving anything that required money, they had to save 40% to 50% of their net pay. Anything less indicated they weren't actually serious.

With even an average measure of frugality, this was entirely possible. It was well within reach. How many wage earners today save 40% - 50% of their net pay? Sure, some do, but how many do so without help from the family, special discounts or subsidies, or earnings in the top 10%? Not many. And this is proof-positive we're not just poorer now than we were 40 years ago, we're much, much poorer.

If we refuse to accept reality, what are the chances we'll be able to fix what's broken? Delusion and wishful thinking are not successful survival strategies.

New podcast: Seeking a Culture of Honor and Integrity with Emerson Fersch and Amy LeNoble (59 min)

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