One more great Orwell quote from 1984 that I also believes echos the reality of our current societal dynamics:
“Heavy physical work, the care of home and children, petty quarrels with neighbors, films, football, beer, and above all, gambling filled up the horizon of their minds. To keep them in control was not difficult…. All that was required of them was a primitive patriotism which could be appealed to whenever it was necessary to make them accept longer working hours or shorter rations. And when they became discontented, as they sometimes did, their discontentment led nowhere, because being without general ideas, they could only focus it on petty specific grievances.”
“The American Dream didn’t get more expensive. It became structurally impossible. This isn’t a future scenario. This is now. This happened through decades of bad management and weak choices. Each choice seemed reasonable in isolation. Together they created systematic impossibility. No ideology. Just math. And math is dangerous because it proves the decline is real – not imagined, not nostalgic, not entitled. Real.” This is EXACTLY RIGHT!
As retired baby boomers (both engineers), my wife and I agree that our generation was the last to realize the “American Dream.” We purchased our first home for 1.8x my (sole) gross income at that time. By 30 years old, we had two children and my wife had chosen to quit working in engineering and stay home to raise our children (ultimately 3 sons + 2 daughters). I worked hard to provide for the family, but life was very good. Unfortunately, our children don’t enjoy the America that we had. In the early ‘80’s when I graduated from a state university (with zero student loan debt), America was still a manufacturing powerhouse – and that made a lucrative engineering career possible. In addition, legal and illegal immigration were strictly limited, so our salaries and hourly labor rates weren’t being intentionally squeezed.
The biggest changes during my career happened after the NAFTA and GATT treaties were signed and China was allowed to enter the WTO. That’s when corporations were incentivized to offshore manufacturing to China and elsewhere. Between 1997 and 2020, more than 90,000 factories were closed within the United States – and that was devastating to the American people (everywhere, but especially in the Heartland). My children (all Millennials) are exceptional people – highly educated professionals working in their chosen fields, but none of them are homeowners and they struggle with the cost of living. It’s appalling.
There are two things that I would add to your list of bad management and weak choices:
1. Offshoring the manufacturing of goods, and replacing it with debt expansion.
2. Elimination of “defined benefit” pension plans – especially for blue collar workers. Replacement with 401-K plans that drive the “passive flows” of today’s markets.
I really do admire your decision to address the problems in our political system. It’s my opinion that we’re too late in the “Fourth Turning” for this approach to resolve our problems. I suspect that we’re heading for an incredibly bad socio-economic crisis, greater than anything our nation has seen since its founding. My goal is to prepare for this kind of scenario and be ready to offer aid to my adult children and extended family. And pray.
Mike, I’m 36 and I’ve spent the last 15 years digging a wealth advisory firm out of the dirt with my own hands. We’re approaching a billion in assets now, and I’m proud of what we’ve built, but I need to say something most people in my position won’t say.
I’m the anomaly in my generation.
My story isn’t normal.
My outcome isn’t something I can honestly tell younger people to replicate.
I sit across from real families every day and watch them struggle against math that simply doesn’t work anymore. They feel the squeeze even when they’re doing everything right. And your writing is the first thing I’ve read that actually reflects the reality I see on the ground. You articulated what I’ve been carrying in my gut for a long time.
You’ve pushed me to speak more honestly, and you’ve made me seriously consider stepping into a bigger arena because sitting quietly while the floor erodes under the next generation feels wrong.
If you’re open to it, I’d genuinely appreciate the chance to connect. I think we’re wrestling with a lot of the same truths, and I respect your work more than you know.
Great piece. FWIW, the entire Democratic establishment is talking about this paper https://decidingtowin.org which states that they should focus on cost of living issues (though no concrete policy proposals).
Personally, I don't think we have the time for any kind of systemic economic reform until we run into the wall at full speed on the fiscal front.
Maybe it's being in Silicon Valley but my current read is "explosive economic growth from AGI or bust".
Living on the other side of the Atlantic, my answer is a straightforward “no, I’m not an American” but I have always been an optimist about America. It’s a country founded on the principle of being run by the people and for the people - which for generations has seemed like an attractive proposition for people suffering hardship in Europe.
As someone interested in economic history I have always been fascinated by the economic expansion that took place in the US starting in the summer of 1940 (18 months before Pearl Harbour), when an enormous spending bill was passed to effectively double the size of the US navy. With the fall of France the US Congress realised the imminent danger of war in the Pacific & Atlantic at the same time.
What is astonishing is how quickly a country that had been mired in the Great Depression suddenly sprang to life and managed to build not just ships but planes in numbers that were unimaginable just a few years earlier.
Millions of Americans who had been unemployed or underemployed in the South or rural areas migrated North and West to take up the factory work suddenly available. Many had never earned such high and regular wages before. Many became tax payers for the first time.
All this activity meant that the economy expanded rapidly, full employment was achieved, war time rationing meant that a lot of income was saved in war bonds which helped to continue the expansion when the war ended. What about all the debt? Well at least people knew where the money went - they had won the war.
All of this was a huge vindication of Keynes thinking, in the sense that unless all the machines in a factory are running 24 hours a day, and everyone who wants to work is working, then you can always do better. The United States is an astonishingly well endowed country, with more coastline, rivers, farmland and minerals than anywhere else on earth. It just seems to have had bad luck with its politicians recently.
The great safety valve is a federal structure where powerful states like California can power ahead in technology or creative industries while Washington is ineffective. There is nothing that America can’t do (build the Hoover dam, the B29 bomber, an atom bomb, walk on the Moon, create the iPhone). So much anxiety and stress for young people seems to revolve around housing, the Financial Times in London seems to be suggesting that treating property as an investment asset rather than as a home is an issue which should be looked at. Perhaps there is an idea there.
Many government programs were set up in the past to make housing affordable for many. VA, FHA, USDA mortgages with low down payment requirements. 30 year fixed mortgages. GSEs that sponsored these loans and more. With the financialization of housing the opposite effect has taken place.
Great rant! I (old boomer) agree with most of your points. I'd simplify your math though, to one word INFLATION. Didn't Lenin (1st Soviet Union dictator for those uneducated in history) say the way to destroy capitalism is by debasing the currency?
Mike - thank you for this. You’ve made me a paid subscriber. I fully support what you wrote and commend you for the call to action.
I think it would be great to have Mandani on. Everything I know about him is that he’s a well intentioned, good faith guy and is willing to be open and talk to anyone who can help tackle the affordability crisis in NYC.
And I think as an accomplished finance and intellectual heavyweight like yourself , and from a differing background, it
Will be great for you guys to talk and trade ideas.
I don’t know Mandani directly but I’m
Part of the greater NJ Muslim community and I am can try to get in contact with someone who knows him. Please let me know if you would be interested
Thank you for another amazing article. We are currently working on what we believe to be a solution, that would empower the American people. Would love to share it with you when the time is right.
Fantastic post, Mike—smart, nuanced, compassionate. Also a fellow Racket book reader I gather. Thanks for this—much food for thought.
(And you didn't rail against BTC once, which means your IQ wasn't immediately halved! Seriously, your comments on crypto aren't going to age well. But that's another topic...)
Michael, I thought last week blew me away, and now this!
Your breakdown of the property tax arithmetic is devastating proof: it’s not "entitlement," it’s a systematic extraction. I really enjoyed how perfectly nailed the Orwellian Dynamic: the promise to "own nothing" is enforced through the "Mockery Machine." We are being told to accept precarity as patriotism, while the original promise of abundance for hard work is withdrawn. We have to get our level playing field back and re-price that option. Thank you for framing the fight with such clarity and thank you for taking it back to 'them'!
Great article and inspiring conclusion. I have a friend (fellow mid-30s Millennial) who is early in considering running for office in Florida. Will reach out if he moves forward with that.
Great piece. I’m starting to detect a theme between your recent pieces and your passive critique: firstly we, as a society, crowd around some local maxima (rationally, on the individual level). We mold society and regulations around this new found demand and end up ruining the market mechanism entirely (we also realize the local maxima isn’t worth maximizing in the first place, ie the college degree is worthless. The signal of the college filtering process is valuable. Begin to hand out too many degrees and the signal ceases to exist).
Is the “true issue” more of the former, or the latter? Is the issue that we tend to crowd (social media and tv probably have a large role to play) or that we so willfully mold our governments and society towards these local maxima (a deeper conservative critique)
I went back to college for a degree in mechanical engineering (graduated 2018 from UMD). For the last 7+ years I have worked hard and have continued to develop my skills in the field becoming a valuable individual contributor to the companies I have worked at. Despite this, I am treading water and unable to improve my financial situation which is why I have resorted to speculation in markets (carefully as one can). Due to my situation, I probably shouldn’t purchase Substack subscriptions however some provide information that could help me make better decisions, like yours. This write-up hit home and I want to thank you for taking an interest in the subject even though you may be selfishly doing it for your children. If I come across any candidates or think of any other way I can help I will let you know.
One more great Orwell quote from 1984 that I also believes echos the reality of our current societal dynamics:
“Heavy physical work, the care of home and children, petty quarrels with neighbors, films, football, beer, and above all, gambling filled up the horizon of their minds. To keep them in control was not difficult…. All that was required of them was a primitive patriotism which could be appealed to whenever it was necessary to make them accept longer working hours or shorter rations. And when they became discontented, as they sometimes did, their discontentment led nowhere, because being without general ideas, they could only focus it on petty specific grievances.”
Thank you for doing this.
Excellent piece!
“The American Dream didn’t get more expensive. It became structurally impossible. This isn’t a future scenario. This is now. This happened through decades of bad management and weak choices. Each choice seemed reasonable in isolation. Together they created systematic impossibility. No ideology. Just math. And math is dangerous because it proves the decline is real – not imagined, not nostalgic, not entitled. Real.” This is EXACTLY RIGHT!
As retired baby boomers (both engineers), my wife and I agree that our generation was the last to realize the “American Dream.” We purchased our first home for 1.8x my (sole) gross income at that time. By 30 years old, we had two children and my wife had chosen to quit working in engineering and stay home to raise our children (ultimately 3 sons + 2 daughters). I worked hard to provide for the family, but life was very good. Unfortunately, our children don’t enjoy the America that we had. In the early ‘80’s when I graduated from a state university (with zero student loan debt), America was still a manufacturing powerhouse – and that made a lucrative engineering career possible. In addition, legal and illegal immigration were strictly limited, so our salaries and hourly labor rates weren’t being intentionally squeezed.
The biggest changes during my career happened after the NAFTA and GATT treaties were signed and China was allowed to enter the WTO. That’s when corporations were incentivized to offshore manufacturing to China and elsewhere. Between 1997 and 2020, more than 90,000 factories were closed within the United States – and that was devastating to the American people (everywhere, but especially in the Heartland). My children (all Millennials) are exceptional people – highly educated professionals working in their chosen fields, but none of them are homeowners and they struggle with the cost of living. It’s appalling.
There are two things that I would add to your list of bad management and weak choices:
1. Offshoring the manufacturing of goods, and replacing it with debt expansion.
2. Elimination of “defined benefit” pension plans – especially for blue collar workers. Replacement with 401-K plans that drive the “passive flows” of today’s markets.
I really do admire your decision to address the problems in our political system. It’s my opinion that we’re too late in the “Fourth Turning” for this approach to resolve our problems. I suspect that we’re heading for an incredibly bad socio-economic crisis, greater than anything our nation has seen since its founding. My goal is to prepare for this kind of scenario and be ready to offer aid to my adult children and extended family. And pray.
I'm in engineering now, and it's a stark difference to what you describe
I’d love to understand your perspective
I'm what ways?
Mike, I’m 36 and I’ve spent the last 15 years digging a wealth advisory firm out of the dirt with my own hands. We’re approaching a billion in assets now, and I’m proud of what we’ve built, but I need to say something most people in my position won’t say.
I’m the anomaly in my generation.
My story isn’t normal.
My outcome isn’t something I can honestly tell younger people to replicate.
I sit across from real families every day and watch them struggle against math that simply doesn’t work anymore. They feel the squeeze even when they’re doing everything right. And your writing is the first thing I’ve read that actually reflects the reality I see on the ground. You articulated what I’ve been carrying in my gut for a long time.
You’ve pushed me to speak more honestly, and you’ve made me seriously consider stepping into a bigger arena because sitting quietly while the floor erodes under the next generation feels wrong.
If you’re open to it, I’d genuinely appreciate the chance to connect. I think we’re wrestling with a lot of the same truths, and I respect your work more than you know.
I would be happy to
Thanks, Mike. I appreciate that.
What’s the easiest way for us to connect?
Whenever the timing works, I’d value a real conversation
DM me here or Twitter
Thank you!
Great piece. FWIW, the entire Democratic establishment is talking about this paper https://decidingtowin.org which states that they should focus on cost of living issues (though no concrete policy proposals).
Personally, I don't think we have the time for any kind of systemic economic reform until we run into the wall at full speed on the fiscal front.
Maybe it's being in Silicon Valley but my current read is "explosive economic growth from AGI or bust".
Living on the other side of the Atlantic, my answer is a straightforward “no, I’m not an American” but I have always been an optimist about America. It’s a country founded on the principle of being run by the people and for the people - which for generations has seemed like an attractive proposition for people suffering hardship in Europe.
As someone interested in economic history I have always been fascinated by the economic expansion that took place in the US starting in the summer of 1940 (18 months before Pearl Harbour), when an enormous spending bill was passed to effectively double the size of the US navy. With the fall of France the US Congress realised the imminent danger of war in the Pacific & Atlantic at the same time.
What is astonishing is how quickly a country that had been mired in the Great Depression suddenly sprang to life and managed to build not just ships but planes in numbers that were unimaginable just a few years earlier.
Millions of Americans who had been unemployed or underemployed in the South or rural areas migrated North and West to take up the factory work suddenly available. Many had never earned such high and regular wages before. Many became tax payers for the first time.
All this activity meant that the economy expanded rapidly, full employment was achieved, war time rationing meant that a lot of income was saved in war bonds which helped to continue the expansion when the war ended. What about all the debt? Well at least people knew where the money went - they had won the war.
All of this was a huge vindication of Keynes thinking, in the sense that unless all the machines in a factory are running 24 hours a day, and everyone who wants to work is working, then you can always do better. The United States is an astonishingly well endowed country, with more coastline, rivers, farmland and minerals than anywhere else on earth. It just seems to have had bad luck with its politicians recently.
The great safety valve is a federal structure where powerful states like California can power ahead in technology or creative industries while Washington is ineffective. There is nothing that America can’t do (build the Hoover dam, the B29 bomber, an atom bomb, walk on the Moon, create the iPhone). So much anxiety and stress for young people seems to revolve around housing, the Financial Times in London seems to be suggesting that treating property as an investment asset rather than as a home is an issue which should be looked at. Perhaps there is an idea there.
Many government programs were set up in the past to make housing affordable for many. VA, FHA, USDA mortgages with low down payment requirements. 30 year fixed mortgages. GSEs that sponsored these loans and more. With the financialization of housing the opposite effect has taken place.
Great rant! I (old boomer) agree with most of your points. I'd simplify your math though, to one word INFLATION. Didn't Lenin (1st Soviet Union dictator for those uneducated in history) say the way to destroy capitalism is by debasing the currency?
Mike - thank you for this. You’ve made me a paid subscriber. I fully support what you wrote and commend you for the call to action.
I think it would be great to have Mandani on. Everything I know about him is that he’s a well intentioned, good faith guy and is willing to be open and talk to anyone who can help tackle the affordability crisis in NYC.
And I think as an accomplished finance and intellectual heavyweight like yourself , and from a differing background, it
Will be great for you guys to talk and trade ideas.
I don’t know Mandani directly but I’m
Part of the greater NJ Muslim community and I am can try to get in contact with someone who knows him. Please let me know if you would be interested
Please do. I would love that
Thank you for another amazing article. We are currently working on what we believe to be a solution, that would empower the American people. Would love to share it with you when the time is right.
Please do. Dm on Twitter is apparently easiest
Thank you Mike. I believe you have to follow me back on X so that I may send you a DM. My handle is @colasaccomar
Fantastic post, Mike—smart, nuanced, compassionate. Also a fellow Racket book reader I gather. Thanks for this—much food for thought.
(And you didn't rail against BTC once, which means your IQ wasn't immediately halved! Seriously, your comments on crypto aren't going to age well. But that's another topic...)
This is a wonderful read. Thank you Mike.
Michael, I thought last week blew me away, and now this!
Your breakdown of the property tax arithmetic is devastating proof: it’s not "entitlement," it’s a systematic extraction. I really enjoyed how perfectly nailed the Orwellian Dynamic: the promise to "own nothing" is enforced through the "Mockery Machine." We are being told to accept precarity as patriotism, while the original promise of abundance for hard work is withdrawn. We have to get our level playing field back and re-price that option. Thank you for framing the fight with such clarity and thank you for taking it back to 'them'!
Great article and inspiring conclusion. I have a friend (fellow mid-30s Millennial) who is early in considering running for office in Florida. Will reach out if he moves forward with that.
Please encourage him and have him reach out
I'll reach out to a few people. Hopefully will have at least one for you to speak to. We'll be in touch. Much appreciation for this initiative!
Great piece. I’m starting to detect a theme between your recent pieces and your passive critique: firstly we, as a society, crowd around some local maxima (rationally, on the individual level). We mold society and regulations around this new found demand and end up ruining the market mechanism entirely (we also realize the local maxima isn’t worth maximizing in the first place, ie the college degree is worthless. The signal of the college filtering process is valuable. Begin to hand out too many degrees and the signal ceases to exist).
Is the “true issue” more of the former, or the latter? Is the issue that we tend to crowd (social media and tv probably have a large role to play) or that we so willfully mold our governments and society towards these local maxima (a deeper conservative critique)
Why not run for office yourself? Got my vote.
Worst choice ever. But thank you.
That's why we rarely get good people though 😭
Thinking the same thing myself!
I went back to college for a degree in mechanical engineering (graduated 2018 from UMD). For the last 7+ years I have worked hard and have continued to develop my skills in the field becoming a valuable individual contributor to the companies I have worked at. Despite this, I am treading water and unable to improve my financial situation which is why I have resorted to speculation in markets (carefully as one can). Due to my situation, I probably shouldn’t purchase Substack subscriptions however some provide information that could help me make better decisions, like yours. This write-up hit home and I want to thank you for taking an interest in the subject even though you may be selfishly doing it for your children. If I come across any candidates or think of any other way I can help I will let you know.