One Economy to Rule Them All

WE FILTHY RICH:

Reflections on Americans’ Net Worth (Bryan Caplan, Sep 02, 2026, Bet on It)

1. Economists have long known that inequality is relatively low for consumption, medium for income, and high for wealth. What they rarely emphasize, however, is how much wealth depends on age. The richest Americans aged 65-69 are worth about 30x as much as the richest Americans aged 18-24.
2. Net worth is very high in absolute terms. The median is over six figures by the mid-30s. Americans at the 75th percentile are millionaires by their mid-50s. Americans at the 90th percentile are millionaires by around 40. Claims about middle-class, middle-aged Americans who “can’t afford” eggs or gas or beef are nonsense.
3. The most sensible argument for worrying about trade deficits is that we’re “living beyond our means.” Trade deficits represent borrowing, and we can’t keep borrowing forever. But given Americans’ extraordinary net worth, the most sensible argument for worrying is still senseless. After 50 years of unbroken trade deficits, we’re wealthier than ever.
4. Americans of staggering net wealth are all around us. If you walk around an American mall on a weekend, you probably cross paths with several decamillionaires. But except for being older, you probably couldn’t pick them out of a crowd. Even their cars rarely scream extreme wealth.
5. Whatever your complaints about American capitalism, you’ve got to admit that a large share of Americans use the system to become staggeringly wealthy by the time they retire. Not 1% or 5%, but 25%.
6. Americans with low or negative net wealth are also all around us. But who ever thought otherwise? In my 20s, I had very low net worth, and so did all my friends. And that fact contains a lesson: Almost all low-wealth Americans are young. If you have a regular job and age a couple decades, you’re rarely poor anymore.
7. If you’re old and your wealth is still low, your financial situation is basically hopeless. You can still be happy, but it would take a miracle (like winning the lottery) for your finances to dramatically improve. Every other American, however, is already rich, or could become rich with durably cautious budgeting. The math behind “Skip a $5 coffee every day from the age of 18, invest the savings in the stock market, and you’ll have hundreds of thousands of extra inflation-adjusted dollars when you retire” is sound.
8. Earning regular high income is the easiest way to end up with high wealth. But it’s neither necessary nor sufficient. A high-skilled worker who blows his whole paycheck week after week ends up with a net worth of roughly zero. A Costco cashier with a high savings rate ends up a millionaire. That’s not just a freak anecdote. It’s math.
9. Wealth peaks around age 70, roughly what you’d expect given the permanent income hypothesis. What’s surprising is how slowly wealth declines from this peak! Americans over 80 are still loaded, generally having higher net worth than they had 30 years earlier. And despite this wealth, Social Security checks keep rolling in.
10. Given their current net wealth, a solid majority of Americans can comfortably retire without Social Security. The federal government could cut them off completely and they’d still do fine. The best rationale for the status quo is paternalism, but most Americans are well-prepared for their futures even ignoring Social Security.

WE COULD USE A CHALLENGE:

The $40 Trillion Question: Can America Turn Debt Into Renewal?: History suggests that fiscal crises need not destroy nations — and America may be uniquely equipped to emerge stronger. (Lewis M. Andrews, September 5, 2026, American Spectator)

But it should also be remembered that a sovereign debt crisis is not a national death sentence. As Ray Dalio, founder of the hedge fund Bridgewater Associates, notes in his 2018 study of Principles for Navigating Big Debt Crises, there are many cases throughout history when the reforms needed to rescue a fiscally troubled country were not only enacted in time but actually produced significant economic and social improvements.

Fortunately for the U.S., some measures that could help trim federal spending have wide popular support. These include work requirements for Medicaid (estimated to save $32.6 billion per year), tighter screening of all entitlements for fraud ($233 to $521 billion per year), and a 10 percent across-the-board cut to all non-defense and non-entitlement discretionary spending ($73 billion per year).

Many left-wing groups are predictably fighting to preserve these expenditures, accusing reformers of everything from racism to greed. But as it becomes increasingly clear to voters that something must be sacrificed to keep the country solvent, they will clearly back the cuts most already accept.

Equally fortunate for the U.S. is that while its government added $29.8 trillion to the national debt after the financial crisis of 2007, the total value of all the country’s assets, public and private, simultaneously skyrocketed from $195 trillion to $513 trillion. In other words, America is currently worth nearly 13 times what it owes its lenders. Which means its credit is good enough that needed spending reductions can be stretched out to be less painful and even trimmed as an improving economy yields higher tax revenues.

But the country’s biggest advantage going into a financial crisis is that it is a remarkably diverse and technologically sophisticated society, which means that many spending cutbacks, while hard in the short run, will likely surface cheaper and even more beneficial alternatives. Something we read about all the time in business but is by no means unknown in the public sector.

YOU ARE THE WEALTHY:

A record number of millionaires created in US by rock-solid 401(k) market (Jasmine Fernández, 04 September 2026, Independent)

A soaring stock market and persistent employee contributions pushed the number of 401(k) millionaires in the United States to an all-time high in the second quarter.

Data from Fidelity Investments shows that the number of 401(k) accounts on its platform holding at least $1 million expanded by 19 percent from the first quarter, reaching a record 769,000 accounts. The jump marks the largest quarterly growth in seven-figure balances since late 2023, according to a report released Thursday.

Should have adopted W’s SS reforms.

LEFT/RIGHT ECONOMICS IS SELF-HARM:

America Suspended the Jones Act. Americans Were the Winners.: In under five months, waiving the protectionist law opened up whole trade routes and sent fuel to areas that needed it. Why go back? (Veronique de Rugy | 8.13.2026, reason)

Since March, America has been running an accidental experiment and glimpsing what the country might look like without one of its dumbest statutes. The results are in, and they embarrass a century’s worth of U.S. lawmakers and defenders. […]

The numbers speak for themselves. The Cato Institute’s Colin Grabow documented that in under five months, Puerto Rico took in more mainland fuel than in any full year since 2015. Shipments to the West Coast, Alaska, and Hawaii hit nearly 14 million barrels, about 170 percent of the recent annual average. Whole trade routes quickly appeared: Gulf Coast fuel to Hawaii, New Jersey jet fuel to California, propane to Puerto Rico.

America’s government-protected fleet seldom served these locales. Remove a prohibition and the market pours resources where they are needed. As Grabow noted, “That’s strong evidence for the longstanding critique that the Jones Act suppresses domestic commerce by preventing economically viable trade between Americans.”

WE ARE UNIMAGINABLY AFFLUENT:

WHERE’S MY FREE LUNCH?:

‘Free Stuff’ in Norway Still Costs Half of Average Pay: Taxes claims half of middle class paychecks, leaving households with subpar public services and less disposable income (Joakim Book, July 27, 2026, Daily Economy)

THE rIGHT IS THE lEFT:

Who pays for tariffs? Insights from recent research (Kimberly Clausing (PIIE) and Maurice Obstfeld (PIIE), August 3, 2026, Peterson Institute)

Still, study after study of the 2018-19 US tariffs found that US buyers of imports suffered essentially the entire burden of the tariffs, with nearly complete pass-through shown in the data.[1] Preliminary assessments of the 2025 tariffs, reviewed in Clausing and Obstfeld (2025), also held that US consumers and firms were likely to bear the vast majority of the burden.

ALWAYS BET ON THE dEEP sTATE:

Trump’s New Fed Chair Deserts Trump (Robert Kuttner, July 29, 2026, American Prospect)

As expected, the Federal Reserve did not raise interest rates today, but neither did it lower them from its current target range of 3.5 to 3.75 percent for short-term rates. And the vote was 9-to-3, with three regional bank presidents—Beth Hammack of Cleveland, Neel Kashkari of Minneapolis, and Lorie Logan of Dallas—voting to raise the target range for the federal funds rate by a quarter percentage point. It was the first time since 2016 that three officials dissented in the same direction.

THE DELUSIONS OF THE PROGRESSIVES:

Scottish tax hike for high earners backfires with loss of £22m: A top rate of 48p for incomes above £125,140, intended as a ‘progressive’ move to raise money for public services, has instead reduced revenues, expert analysis shows (Daniel Sanderson, July 25 2026, Times UK)

Dan Neidle, a tax policy expert who was part of the Scottish government’s recently axed tax advisory group, said its decision to impose a 48p top rate had instead reduced revenues.

All comedy is conservative.

BORROWING MILEI’S CHAINSAW:

‘I’m over the moon’: New York’s small business owners rejoice as Mamdani cuts red tape: Initiatives including cutting permits just to serve ice-cream amount to a sweeping program of deregulation (Christopher Mathias, 25 Jul 2026, The Guardian)

Red Scare? The democratic socialist mayor of New York City spent this week talking about red tape.

On Tuesday, Zohran Mamdani – the politician at the center of a revived rightwing panic about socialists and purported communists winning elections across America – posted a video on X of himself putting a sheet of paper with the phrase “RED TAPE” into a paper shredder. Other pieces of paper, with phrases like “cumbersome fees and fines” and “a permit you need just to serve ice-cream”, were shredded too. The video, set to Wu Tang Clan’s If Time Is Money, shows Mamdani joining a handful of city officials and small business owners throwing the resulting paper shreds into the air like confetti.

“New York’s small business owners have said it over and over: endless paperwork and the uncertainty of dealing with City government has made getting their stores up and running too difficult,” Mamdani wrote on X, announcing a package of 50 policy changes aimed at easing the financial burden of fines, fees and regulations on mom-and-pop shops across the five boroughs.

Economics trumps ideology.