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As unrest spreads throughout the US, sparked by the atrocious killing of George Floyd, a broad systemic crisis has been steadily burning for decades beneath the surface.
1. If there is one chart that best shows the years of anger & social unrest that has now made its way onto the streets of the United States, it would be this one.

The wealth of the bottom 300,000,000 Americans compared to the wealth of the top 33,000 Americans.
2. As you can see, around the late 1980s, the wealth of the bottom 90% of America began a strong down trend that has continued for the last thirty years.

Who were the President during these times?

Bush Sr. (1989-1993)
Clinton (1993-2001)
Bush Jr. (2001-2009)
Obama (2009-2017)
3. The second most important chart to understand what we see going on in America today.

"The Productivity-Pay Gap"

Post WWII, as the US economy expanded, American workers reaped the rewards of expansion, but in the 1970s, this started to change.

Pay and productivity diverged.
4. The third most important chart to understand what we see going on in America today.

"US Trade Balance"

In 1970s, for the first time in a century, the US had a negative trade balance.

A trade deficit which has continued to grow over the last fifty years.
5. What fundamentally changed about the US dollar in the 1970s?

In 1971, the United States ended convertibility of the US dollar to gold rendering the US dollar a fiat currency.

The Bretton Woods era came to an end.

A period notably marked by zero banking crisis.
6. Around this same time, the US average tariff rate made it's final descent towards zero, ending two hundred years of high tariff rates and protectionist policy.

The era of "free trade" or "globalism" began.

In other words, the era of no tariffs.
7. President Abraham Lincoln said, "Give us a protective tariff and we will have the greatest nation on earth." Lincoln warned that "the abandonment of the protective policy by the American Government… must produce want and ruin among our people."
8. Looking back at US history, tariffs were more of a rule than an exception. Taxing foreign goods and encouraging home industry.

President Theodore Roosevelt said, “Our past experience shows that great prosperity in this country has always come under a protective tariff.”
9. This brings me back to those first three charts.

It's a fact that 300,000,000 Americans got poor while 33,000 Americans got rich.

How much of the social unrest today is due to the fact that Americans are broke and in debt?

Which policy decisions caused this?
10. Executive pay skyrocketed after the 1970s.
11. While the homeless population skyrocketed.
12. As Americans got poor; anxiety, stress, and depression increased.

Deaths of despair from overdose & suicide climbed.
13. According to the fed, between 1989-2018, the top 1% increased its total net worth by $21 trillion. While the bottom 50% actually saw its net worth decrease by $900 billion over that same time period.

So what major economic policy changed while these four were in charge?
14. Global trade changed.

Specifically, the "North American Free Trade Agreement" (NAFTA) and the "World Trade Organization" (WTO).

These deals would architect how money, goods, and services would flow between borders for the next three decades.
15. NAFTA was first signed by George Bush Sr. in 1992, approved by congress shortly after, and signed into law by Bill Clinton in 1993.

Bush and Clinton promised that it would lower the US trade deficit, usher in new era of prosperity, and good-paying jobs for the middle class.
16. Instead, the opposite happened.

The trade balance with Mexico went from a $1.7 billion surplus in 1993 to a $15.8 billion deficit in 1995.

The deficit kept growing and hit $75 billion by 2007.
17. Chrysler, Ford, and GM moved their vehicle production from the US to Mexico.

In 1993, the year before NAFTA, the US imported 225,000 cars and trucks from Mexico.

By 2012, the US was importing 1,400,000 vehicles a year from Mexico.
18. Corporate profits soared to new highs, CEO compensation followed, but worker's wages in Mexico and America remained the same.
19. US CEOs took those newfound profits overseas.

Why would they invest in the US when they could set up in cheaper countries?

There they could pay workers cents an hour, avoid the cost of environmental regulations, and not have to worry about workers rights or unions.
20. NAFTA paved the way for China to enter the WTO.

The political establishment, hand in hand with the banks and corporations, signed Permanent Normal Trade Relations (PNTR) in 2001 allowing China to enter the WTO.

Clinton, Bush, and Obama supported China's entry into the WTO.
21. Once again, the promise was lower trade deficits and better paying jobs for US workers.

But once again, the opposite happened.

Shortly after China joined the WTO in 2001, the US trade deficit soared to $700 billion by 2005.
22. Between 2001-2014, the US went from 348,513 to 274,756 manufacturing establishments.

A loss of 73,757 factories.
23. The fed estimates, the US exported nearly 30M jobs between 1992 and 2010.

The US worker participation percentage fell 4% between 2001 and 2013 as millions of Americans gave up on looking for a job.
24. China didn't play by the WTO rules. They used child labor, ignored worker's right & pollution regulations, and actively promoted the theft of American IP.

A 2018 study concluded that, "Chinese theft of American IP currently costs the US between $225B and $600B annually."
25. As regulations climbed in the US, large corporations closed tens of thousands of factories, and outsourced American jobs to low-wage countries overseas, where there was little to no regulations.

Smaller competitors who couldn't afford global operations vanished.
26. After 1971, with the US dollar no longer tied down by the gold standard, money supply (M2) quickly increased.

Followed by foreign aid, another way of taking from the poor in the US and giving to the rich in foreign countries.
27. For example, after the US invaded Iraq and Afghanistan, the politically connected received lucrative construction contracts via foreign aid.
28. Although NAFTA and the WTO were heavily favored by the majority of the Washington political establishment.

A handful of politicians opposed these "free trade" deals.

For example, Bernie Sanders.

29. Ron Paul also vehemently opposed NAFTA and the WTO since they formed in the 1990s.

30. In 1992, the billionaire presidential candidate, Ross Perot, explained exactly how NAFTA would suck jobs out of the US in front of fellow running mates George Bush Sr. and Bill Clinton.

31. Perot said, "If you're paying $12 - $14 an hour for factory workers, you can move your factory south of the border and pay a dollar an hour for labor, have no health care, have no pollution controls, and no retirement, and you don't care about anything, but making money."
32. Since the 1980s, Donald Trump has also been a vocal critic of NAFTA, WTO, "Free Trade" deals, and the trade deficits that the United States has accrued around the world.

33. Donald Trump has also been a vocal critic of the US policy of defending other countries and the world's commercial shipping routes at the expense of the US taxpayer.

washingtonpost.com/news/worldview…
34. The US is bound by a number of treaties, signed since WWII, which forces it to defend 75% of the world's economic output and a quarter of the world's population at the expense of the American taxpayer.
35.This has been perhaps the most costly policy decision for US taxpayers, with military spending going from $100 billion in 1947 to $700 billion in 2010.

While the world has been able to depend on the defense of the US military at relatively no cost, Americans went broke.
36. In the 1980s, interest rates peaked around 18% and began descending, while M2 entered an expansionary period, leading to a generational market boom.

"91% of the price appreciation for the classic portfolio came from just 22 years between 1984 and 2007." @vol_christopher
37. This stock market boom also disproportionately helped the wealthy as they were the largest holders of stocks.

While the bottom half of the country did not invest their money, saw their wages stagnate, and the continued decline of the purchasing power of the dollar.
38. The era of "Free Trade" & "Globalism" has benefited a small minority of the world at the expense of the large majority.

The rise of wealth & income inequality has been a global phenomenon.

The world's 26 richest people now have more than the world's poorest 3,900,000,000.
39. As people lost their wealth and opportunity, they lost faith in their establishments & institutions.

Trust in government and media plummeted as people lost sight of the "American Dream".
40. The common man has increasingly no longer felt represented by their governments and institutions, massive protest took to the streets in 2019; Hong Kong, France, China, Ecuador, Haiti, Lebanon, Iraq, Iran, Chile, Spain, Netherlands, Indonesia, Turkey, Venezuela, Brazil, etc.
41. Populism rose around the world.

In other words, a rebellion of the "common man" against the "elite establishment".

Disenfranchised by the system, voters voted for anti-establishment leaders.

Perhaps best exemplified by the 2016 vote for Brexit and the election of Trump.
42. Call it the end of @RayDalio's long term debt cycle.

43. Call it @HoweGeneration's fourth turning.

44. Or call it @RaoulGMI's downward pressure from baby boomer retirement.

45. But would there be this much global anger and social unrest if workers wages had gone up alongside corporate profits?

I personally think it's because after decades of failed policy people are broke, in debt, and pissed off about the destruction of the "American Dream".
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