The Economy Is So F%*$#D

Added: 2026-05-28

[00:00:00]A lot of people don't seem to recognize that the general like boomer hate is a misdirection. It's almost as much of a misdirection as um animosity towards um immigrants or black people or whatever as a distraction from the fundamental problem. The fundamental problem is capital.

[00:00:17]It's capital. The reason old people on average have so much is because they benefited from the early investment boom that generated the current wave of financialization. They were around to buy the houses before they became an ultimate speculative commodity. They were around to invest in the businesses before everything took off. It's not like an innate property of being old or whatever. They were just the guys who were there at the ground floor of the the boom of of western I don't know hyper capitalism or whatever. Like it's not actually a property of them being old. So getting you know directing your animosity towards the boomers is it's it's correct in a stereotypical sense but it doesn't lead you to correct information.

[00:00:59]I see globe heads are mad about this article as well. Nah, man. It's totally sustainable. It's It's fine. It's completely fine. The case for California's billionaire wealth tax.

[00:01:09]Nah, it's fine. It's fine. Whatever.

[00:01:11]California's wealth tax might not even work conceptually because capital flight is a much more real thing when you're dealing with like state taxes. I don't know. Has to happen at a federal level.

[00:01:21]You said the opposite about NYC. Was that for a wealth tax or for a business tax? I thought we were referring to um the uh the business tax, second house taxes. Yeah, there's a difference between taxing businesses that operate in California where they have nowhere else to go, right? You're not going to just not operate in California versus um personal taxes for people who can just move to a different state. It has to be done federally. Who knows? Any chance they can they can also leave the US if there's a national tax increase? Well, in that case, you have a lot more power because you can individually sanction people. Um, you can uh uh enact federal policy to block people from accessing US wealth in the US stock market unless they pay the [ __ ] up. You can you can hold people to account with the federal government in a way that you just can't with the state government. Also, isn't taxation bound by citizenship in the US?

[00:02:07]Yeah, but we should tax everyone.

[00:02:08]Everyone everyone whether or not they're citizens. The United States should tax everyone on Earth. We should be taxing unhoused war refugees in the Congo. I mean, you can tax the properties they have in the state. That's not enough.

[00:02:21]Oh, nice 3D graphic here in the New York Times. Now, archray of everyone. The idea that the lower classes shouldn't pay taxes is sloppilism and it's uh misdirected by the wealthy. This is why Jeff Bezos was on uh CNBC the other day talking about how the bottom 50% shouldn't pay taxes. Everyone should pay taxes. You're not getting tricked when you pay taxes. It's a cost to participate in civil society. We need to get rid of this like general attitude we have where taxes are like a burden the smart and wealthy get to worm their way out of. It's just not everyone has to pay. Everyone everyone is is is sharing in the pie. They receive and they pay in. It's a it's a collective right of uh of social participation. You should be proud to pay your taxes. But a vast majority of Mr. Zuckerberg's wealth is hidden from income taxes. Look at this graphic they got here. Look at this graphic they got here. Huh? Also, you can bet they won't get rid of sales taxes. We should get rid of sales taxes.

[00:03:17]It is a very good representation. Why?

[00:03:20]Because they're regressive. Poor people spend a greater percentage of their income on um stuff you would pay sales taxes on. Capital gains and property and estate taxes. Don't worry, don't inheritance taxes. Oh, we got to take everything. Being poor is expensive.

[00:03:34]That's true. We fundamentally we have created a system where everyone is incentivized to put all their money in the stock market and then nothing in the stock market gets taxed. It's insane.

[00:03:48]It's genuinely insane. There is no reason once you have enough money that you can leverage your existing assets to take out a loan. There's no reason to ever touch the money you have in the stock market. Which means that all that money, the trillions and trillions and trillions of dollars sitting there are just never taxed. all the money in retirement accounts, 401ks, uh uh uh uh the the stock market, all of it. It's just there never being touched, never being taxed. It's also anti- capitalist if you truly want the system to function. Again, it should be noted I am not making a socialist critique right now, at least not in so far as I'm critiquing the system for being fundamentally unequal. This system doesn't work in its own principles.

[00:04:33]like the the logic of capitalism is failing here. The purpose of the currency, the purpose of capital is to flow for investment. This is irrational on its own terms. This is why Markx was such a smart fellow. Sure, he talked about how capitalism leads to inequality and oppression, blahy blahy blah. You've heard it all before. An idiot could figure that out. He was the one who wrote it down, who penned the ways in which it was innately self-destructive, a flawed system which contained within itself its own criticisms, its own seeds of destruction. That was what made his writings unique. That's why people give a [ __ ] Not just because, oh, he wasn't the guy who came up with the idea that capitalism is oppressive. Corporate America's borrowing at super high levels, of course, that's how they don't touch the principle. commercial and industrial loans at US commercial banks jumped 211 billion year-over-year in the week ending May 13th to 2.89 trillion.

[00:05:26]That's cool, man. And it's it's already like so high. Anyway, man, this chart goes back to 2006, though. So, corporate borrowing has gone up from what 800 to 28. It's like it's tripled basically.

[00:05:37]It's tripled in the past two decades.

[00:05:39]That's cool. Again, it just doesn't work on its own terms. What's to stop them from using the borrowed money to borrow more money in some kind of Ponzi scheme?

[00:05:47]They they do that. That's like the main That's how the economy works now. That's like the main way the economy happens.

[00:05:52]That's what they do. They're doing it right now, man. The proposed wealth tax, the 5% wealth tax of billionaires in California would be enough to pay for highspeed rail on its own. That's crazy.

[00:06:02]Do you have a better idea than just taxes, buddy? Nobody has ever come up with a better idea than taxes. If it works, you don't need to fix it. Mine charts on wealth inequality in America.

[00:06:13]Sure, why not? As long as we're feeling populist this morning. Distribution of family wealth in 2022 seems normal. Ah, look, we can go back through the ages.

[00:06:22]1963, 1983. We'll just skip to 2022.

[00:06:26]Yeah, there we go. Families near the bottom of the wealth distribution between 1963 and 2022 went from having $23 in debt to 450 in wealth. Me, a globe head on Twitter defending this.

[00:06:38]Uh, families near the bottom of the wealth distribution have experienced an infinite percent rise in their overall household wealth. Those in the middle nearly quadrupled their wealth from 50,000 to 200,000. But how much of this wealth is just caught up in real estate?

[00:06:51]You know, like, can you really say that your household wealth has increased if the only way in which your wealth is increased is that the property that you live on is worth more? Like you don't really have any more spending money.

[00:07:01]It's just like in theory if you ever sold your house, you'd have more from that, but then you'd have to get another house and that would cost just as much.

[00:07:08]So like if every house is getting more expensive, it's it's not like you can really leverage that wealth. It's it's like a it's it's not really that liquid, you know. Wealth gaps by race and ethnicity are large. Really? Wealth gap between black and white families widens with age. Difference in lifetime earnings widens wealth gaps. Racism.

[00:07:27]Racism. Racism. Racism. Racism. Racism.

[00:07:29]Racism. Racism. Nice. We love racism.

[00:07:31]Well, no, we don't. We love charts about racism. Well, you can sell your house and buy a cheaper house, which gives you tons of liquid cash. Yeah, that's like the kind of uh the the kind of uh hypothetical that keeps the liberal econ while they're, you know, stroking it. Uh not really something that happens that much in day-to-day. Oh, actually, your household wealth uh valuation, it's its growth in valuation over the past 50 years is liquid wealth because you could just sell it and buy a cheaper house.

[00:07:56]It's just not happening. Like that's just in a in a practical sense, that is just not how it works. Wealth caught up in real estate is illquid. Every fund in the market is dependent on AI. I could have told you that. The authors of the article suggest a onetime 5% tax that would not work, right? Well, no. They're defending a tax propo not proposed, but like defended by Roana, a specific policy that people are banding about.

[00:08:19]This on its own would not be enough. It wouldn't really fix the problem. I'm not sure if I'm even in favor of this necessarily. Like, it would be a good thing. I just I I don't want people to be satisfied with uh you know, fantasmal victories. God, look at that, man.

[00:08:34]wealthiest billionaires from 2005 to 2026. Doesn't really matter if their wealth is liquid or not. For the billionaires, no. No. The ili liquidity of their wealth is meaningless. They can they have enough spending cash also.

[00:08:45]They can leverage uh their wealth uh uh to borrow. You can't really do that with your h. I mean, you can take out a mortgage, but like that's not a great idea, right? You're you're not you're not Larry Page, you know? When when Larry Page leverages his assets to take out a loan, he's doing money maneuvers.

[00:09:03]He's He's paying accountants to do big boy [ __ ] Okay. You taking out a mortgage so you can buy a new car, that's not a that's not a big boy play.

[00:09:10]That's a little boy play. You don't want to be doing that. The game works differently for them. Bosch, I disagree.

[00:09:15]Well, I disagree with you disagreeing.

[00:09:16]And where does that leave both of us?

[00:09:18]The author uh says even if all billionaires leave California, it would take 25 years for their loss of their income tax payments to surpass the amount collected with the 5% one-off wealth tax. No, no, no. It would be good policy for California. It's just like the problems are so fundamental, man.

[00:09:32]They're so fundamental. You You cannot have an economy where the smartest place to put your money is in dragon vaults that the IRS can't touch. It's insane.

[00:09:47]It's insane that we've in we've incentivized that. It makes no sense. If you described it to like uh uh an economist back in the 1800s or something, they would shoot themselves.

[00:09:58]Like it's it's obviously insane.