The American Middle Class Crisis

Noam Chomsky outlines the 10 principles that underlie the concentration of wealth and power, resulting in unprecedented levels of inequality and the erosion of the American middle class. Fix these, and more of us can retire early.

(226) The American Middle Class Crisis | Real Stories Noam Chomsky Wealth Inequality Documentary - YouTube



The video is not available in Portugal. Did Noam Chomsky include the Power Law or Pareto Distributon as one of the ten?

The Captain

No. He focused more on how the wealthy use their money and power to buy politicans and have them pass rules and regulations that prevent any price competition for the businesses they own. Left unchecked, no doubt that leads to the Power Law or Pareto Distributon. The natural progression of unfettered capitalism is a small clique of people own everything and the balance of the population is in serfdom. That’s why things like taxation of the wealthy and antitrust regulation is important.



Here’s what’s wrong with that in this instance. The Natural Law, as it were, is not good enough for those Chomsky is talking about so why talk about it? They are not the beneficiaries of the 80/20 thing as much as they are creating and maintaining just who those 20% are. Only of course, it’s really less than 1%. Another reason the 80/20 rule is not applicable to this. The bottom of that 20% are way way way the hump closer to the bottom 10% of the 80% than they are to the top of that 20% so the comparisons are for marketing purposes only.

Also, why should everyone else, 80% or the 99% simply give up and allow ourselves to be subject to some random outcome of who this 20% (or 1%) are? The real answer is: We don’t have to. Unless you think “It’s a NATURAL LAW” ergo God will smite us if we do not obey" Sure some would believe that if stated that way.

Another massive point always side-stepped by those who spout 80/20 or other such “natural” economic laws is: If anyone’s success is due to this natural law that justifies essentially not doing anything except letting the outcomes fall where they may, then their success is not theirs, is never earned, and requires no protection. Unlimited taxes and shut up about it. It was never yours anyway. Now they’re not some fortunate 20%. All of a sudden no more 20/80 rule. Now they “worked hard” and “earned it” and the government that ought to be small enough to drown in the bathtub has to protect their property.

Humans are always and everywhere attempting to subvert, I mean improve these laws of nature anyway. The 80% to get a fairer deal. The 20% to become the 1%. A heavier than air machine will never fly. You can’t sail around the world you’ll fall off the edge. They told Marconi wireless was a phony. You’ve seen it before


Not just humans, all primates, all mammals, all life forms. Its not the survival of the least fit.

One group of humans who are on my ‘bad’ list are bankers. These humans are so powerful that they coerced the government to create the Fed to protect themselves from their own greed and folly. Is the Fed on Chomsky’s list?

I would love to see a list of successful egalitarian societies since the dawn of history. In theory that was Marx’s idea and objective. How did that work out? Whoever invented the universe created an unthinking protocol of abundance and waste. How many of your sper…m made it? 1%? The fittest or the luckiest survive. The rest are just fuel to keep the system going.

The ethics to try to even out the playing field are noble, no doubt. Can humans ever create such a system and make it successful? I doubt it. It is very difficult to improve the least able and every attempt at egalitarianism relies on handicapping the most able – not the most moral, the MOST ABLE.

I was asked if I was an anarchist, I said no because it does not work. Anarchism devolved into Communism because self imposed egalitarianism, one of the principal aims on Anarchism, simply does not work.

How many of us try to make sure everyone else is on the par with us? Even when we try we get lots of pushback. Camels and weigh loss? I was told, without a shadow of a doubt, that we are not camels. Obviously not but how much camel are we? I had to look it up.

Around 57% of the camel’s genetic code is also found in the human genome.

Unravelling the camel's genetic sequence - News - Nature Middle East.

Humans and chimps share a surprising 98.8 percent of their DNA.

Capitalism and Democracy are the least bad of all the systems we have tried. What was that thread about limiting the trading of government people? Do we elect and hire bad people to run our countries? How stupid if us!

The Captain

TMF does not allow reproduction, sper…m are forbidden !


The entire issue is do we up production in the US? We need a bigger pie.

The wealthy are not simply against everyone else. The left and moderates in the 1% want demand side econ and all boats to rise. If production levels rise, or better put the real GDP growth substantially increases, all of this improves.

The Great American Middle Class is being reborn as we speak.

This should have begun in 2008 instead of 2023. Sheer ignorance and greed have delayed us. Lets see that for what it is. The people in the cheap seats saying give me a tax cut. What a joke they are.


So the wealthy use government, and the power of government to expand and maintain their extreme wealth.

It’s not even close to unfettered because it is using government. Unfettered may be better or worse, but quite possibly better because of the way the very wealthy use government as described above. Realistically, there would never be unfettered for various other reasons (slavery, environment, etc), but maybe getting a little closer to unfettered might do a world of good. For example, business GiantA uses govt to enact legislation that requires $10M in regulation costs each year, that causes business SmallB to not be able to compete in that arena because since they are just starting, they don’t have an extra $10M of capital to spend each year while they catch up to business GiantA (this literally describes all pharma development, for example).

Yet, despite the above logic, somehow so many people come to the conclusion that government ought to become bigger (“more taxes”) and more powerful (“more regulation”). Is there some sort of magic that will stop the very wealthy from using the bigger and more powerful government for their own purposes?

What’s a middle class?

Is it wealth based? i.e. rich, middle, poor
Is it career based? i.e. professionals, workers, laborers
Is it lifestyle based? i.e. cell phones, broad-band internet, new cars, x square foot homes
Is it population based? i.e. the center 2/3 of any given category

Definitions are as big problem as the ‘crisis’

The poverty line seems well defined. The middle class is above the poverty line. Its the upper boundary of the middle class that is fuzzy. It seems to depend on the subject under discussion.

The best definition is rarely used but always front and center if not vague in our minds. The assets of a country per capita. This means are we putting in the infrastructure for people to live a wealthier life style. Then it means are we paid well. Our the investments in the marketplace on a more sound footing.

Perhaps that sounds obscure but if you ask people how they are doing in fact most do not realize it but this matters a great deal to them.

It is a more important definition than did you make $120k this year?

The people that want the $120k are cool but wont get theirs without the country doing well over the longer run.

Yep. We seem to define the middle-class as the 20th to 99.9th percentile in income. Nobodys want to admit they’re “rich”. And the “poverty wage job creators” are always telling the working poor (i.e., 20th to 40th percentile) that things are just fine, and would be better if they worked more uncompensated overtime.



For comparing countries, that’s useful. Even internally, it might be a good measurement as to how well the median compares with the per capita for the country.

BUT, a middle class implies other classes, and their definitions are needed in order to address/fix any ‘crisis’.

I think @intercst says it best, everyone except the very poor identifies as middle class, making it difficult to even identify the problem.

I would say that the class structure has changed (like everything else) over the last 50 years, but the problem is that people don’t recognize that.

Maybe we need better naming for classes - poor, working class, middle class, well to do, wealthy.
Maybe use terms like proletariat and bourgeois as appropriate.

Middle class is really a political term rather than an economic one…

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An appropriate bit of entertainment…

BARBARIANS AT THE GATE story of ROSS JOHNSON nabisco takeover

The Captain

That’s only one side of the coin. What good is having the world’s highest assets per capita if half the people can’t afford healthcare? I have the feeling that people in Portugal are happier than in the USA.

The Captain


Yep. The assets in the US are concentrated in the top 10% of the pyramid. Most Americans have little to no financial assets.

And on items like health care and housing, the wealthy are artificially increasing costs for consumers through regulatory capture and political corruption. All you need to say is “socialism”, and the most racist, ignorant and innumerate 35% of the population keeps voting for the status quo. I’m not hopeful for any improvement, but you can make major bank as an investor if you understand the dynamic.



A well educated voter should be able to figure it out.

Money and power seem to be drivers of public opinion. How about a grass roots effort to educate voters on what is in their best interest. Can they overcome the “socialist” “progressive” labels? Or is it hopeless?

Depends how you define “A well educated voter”–and whether the person WANTS to be “well educated” in the first place.

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The past 40 years have convinced me “it’s hopeless”. As economic conditions continue to decline for the bottom 80%, you’d think there’d be revolution by now. (Well, I guess you could say “January 6th” kind of was. But the soldiers in that revolution really didn’t understand the source of their poor economic outcomes.)

Lyndon Johnson said it best in the 1960’s when he was touring the nation in support of Civil Rights and Voting Rights legislation.

“I’ll tell you what’s at the bottom of it,” he said. “If you can convince the lowest white man he’s better than the best colored man, he won’t notice you’re picking his pocket. Hell, give him somebody to look down on, and he’ll empty his pockets for you.”



Concentration of wealth has always been the stated goal of “supply side economics”. As noted before, I heard Jack Kemp say words to the effect “the rich do all the saving and investing, so the rich should have all the money”.

As the “supply side” narrative has said for forty years: the rich know the best use for money, not “big gummit picking winners and losers”.

And we have seen that shift in the last few years. Instead of telling people that, if the rich are made richer, their boat will “rise”, now, the narrative is everything will be better, if only all the brown people and the Muslims and the gays are gotten rid of.

None of this should be “breaking news”, as the agenda has been publicly stated for decades.



What is in my best interest is not necessarily in the best interest of the country. That is, unless you are a verified, true blue, dyed in the wool idealist. How many people pay more taxes than is taken from them forcibly?

The Captain

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