look, it's harder and harder for the middle class to make it. Over 50% of the people now, when I wrote the book, it was 40%, over 50% of the people now, and the working Americans, live paycheck to paycheck. The reality is, one of the reasons we have such a huge national debt isn't necessarily all due to Congress, it's also due to the ban. It's also due to how we've structured the global economy in the sense that we are the global reserve currency, and one person's debt is another person's asset.
And so, treasuries, you can look at it the opposite way and say, there's $35 trillion of treasuries out there held by people who are believers, and they hold it because it's the great place, and especially today's interest rates, it's a great place to hold money. Welcome back everyone to the Geeks, Geeksers and Googleization Show, the home of Googleization Nation, where we talk with HR and business thought leaders about the crazy, never-normal shift going on all around us. Our goal is to bring you ways to reimagine tomorrow and explore the ever-changing convergence of people, business, and technology. Here's your host, Ira Wuul.
Hi everyone, welcome back to the Geeksers and Googleization Show and another edition of our new monthly series at the corner of Main Street and Wall Street, where we're talking each month about the intersection of the economy, politics, community, and technology. We realize you have a lot of listening and watching options and are grateful you've taken the time to join us today. Joining me once again at the corner of Main Street and Wall Street will be two familiar guests, Matt Van Allstein and John Aidenburn. In addition, we have a special guest on each episode, and this month we're thrilled to welcome a claimed business entrepreneur, best-selling author, and yet this, the father of modern cheerleading, Jeff Webb.
You'll hear more about and from Jeff in just a few minutes. On today's show, we're going to tackle a vexing and provocative problem, the shrinking middle class. There are many reasons why this is important, but at near or at the top of the list is it is the middle class that is likely to decide who the next US president will be. But the importance of the middle class goes well beyond the election, and that's why we're so excited to have Jeff here today.
Let me just offer a few disturbing trends that I uncovered while prepping for this conversation relating to the middle class, and also which you can find a whole lot more in Jeff's book, which we'll be talking about. The share of Americans in the middle class has fallen since 1971, but also the share of total US household income held by the middle class has plunged, but since 1971 as well. Four in 10 children in the US live in lower income households, while only one live in upper income, and about 130 US workers in the information financial services sectors are in the upper income tier. There's a whole lot more that we'll get into and beyond that of why that's taking place.
But before I welcome Matt John and Jeff to the Googleization Nation stage, I want to thank Jim Toes and Security Traders Association for sponsoring today's show. You can join SDA at their flagship event, the 91st annual market structure conference. This year's theme is shifting the landscape and a schedule for September 18 to 20 at the J. W.
Mary at Grand Lakes or in Orlando. You can learn more about SDA and the conference at the SDA website, www.securitytraders.org. Now it's time to dig into this middle class mayhem and its implications for the economy, business, and our communities. I am pleased to welcome back Matt Van Allsign, co-founder and managing partner of Odeon Capital Group, a leading full service broker dealer to institutional clients.
Many of you know Matt from his commentary on this show, and also his outlook on the highly rated Odeon Capital Conversations podcast. John Aidenburn is a veteran Wall Street business journalist, editor, filmmaker, and successful podcast host of Odeon Capital Conversations and Dig Life Deep. And John's newest ventures are two movie projects, one on the legendary life of the Wall Street CEO and scholar and the other on Norman Rockwell. And our special guest, as I mentioned, he's an acclaimed business entrepreneur, he's CEO of Human Events Media Group, which includes digital platforms to post-millennial and human events.
He's the founder of Varsity Spirit and the president of the International Cheer Union. He's widely recognized as the father of modern cheerleading, and he revolutionizes sport by establishing establishing, if I can speak, variety of Varsity Spirit, which has become a global leader in cheerleading. He's also the author of the Amazon best-selling American restoration, How to Unshackle the Great Middle Class. As an aside, Jeff secured cheerleading as an official Olympic sport, although I don't believe we'll be seeing it next week at its launch.
So it's time to welcome everybody to the Googleization stage, and John, Matt, and Jeff. Welcome, gentlemen. Good to be here. Good to be here.
So Jeff, your book's fascinating. And I can say, you know, from that, although I suspect, although we just met literally minutes ago, our political affiliations are probably polar opposites. I'm reading your book and, you know, I agree with everything. So, you know, it's from, I don't know, everything, but I mean, in general, the outcomes and the intentions and the suggestions and the accountability that you're suggesting that that needs to take place and a shift is remarkable, which just shows that regardless of, you know, where your stance is, what your attitude is, we're all agreeing on the outcome that we need change.
And, and, so again, I thank you for that. As I said, although we probably have very, very different stances where we came from, but I pulled up some stats and just to share some graphs. And again, I think one you might have shared in your book, some of the others were more recent. I think your book came out in 2021, 22, or is that least written in that timeframe?
But this was from Sautista, and, you know, they drew this from Pew Research. It's pretty dramatic from 1970, 71 to 2021. And again, so this would have been about the time your book came out, that the lower income percentages, the number of people versus the aggregate income. So the number of people in the lower income class is, it was increased to 4%, you know, almost 20%.
But their income, the amount of income that they had was spread out, you know, even further. And then you look at the jump in the high income class that, you know, there was a good news is that 21, you know, increase almost 50% of the number of people moved into the high income class. But the share of aggregate income was, you know, almost doubled as well. That half of the income is held by 21% of the population, which is creating this problem.
So I think when we talk about, you know, if you just talk about, and this is an issue in the, in the, in some of the, I'll say, agendas or propaganda, whichever side of the aisle you're on, of which direction that we're moving is, yeah, we are probably better off. We are wealthier, you know, higher wages, higher retirement accounts, but the problem is it's not distributed fairly. Well, you're exactly right. I mean, the numbers show it.
I mean, it's pretty stark. And the bad news is it's not getting better. It's getting worse. And, you know, there's a lot of speculation on what does this trend mean if we, if it continues on and on and on.
And I've had people ask me, is this going to be what's going to happen? What's our country going to look like, you know, the, when you really look at the kind of the American economic engine, which was the greatest in the world, frankly, which, which I, I, as you know, from the book, I feel like you can kind of start at the end of World War II when the, when the GIs came home and, you know, they, you know, went to when you got their education, started families and started up the corporate ladder. We built this incredible middle class with compared to other countries, a very, very affluent and large middle class. I think that's what made the difference in America and the rest of the rest of the world.
And it's what really sets us apart among other things, but I think it's important element in the differentiation. And again, as when you start looking at the last 20 years or so, 25 years ago, the squeeze began to occur where the people had smaller and smaller amounts of disposable income. Both parents went, when I was a child for a while, we get one person working in my family. I grew up very much a middle class family, but we were able to get by, we went to, you know, decent public schools.
I mean, we really get by. We didn't consider ourselves poor, that's for sure. But, you know, again, as you look, it's harder and harder for the middle class to make it. Over 50% of the people now, when I wrote the book, it was 40%, over 50% of the people now, and the working Americans live paycheck to paycheck.
That means they don't have any extra money for a medical emergency to put toward their kids' college tuition to help with the sick loved one. They don't have any of that. And it's a dangerous, dangerous situation. And you can only imagine the amount of stress that that means.
They're not saving for retirement. They can't do it. They can't buy a bigger home. It's a squeeze and it's creating a big problem here.
I heard this last night from, and again, probably somebody who we agree with the outcomes with polar opposite Scott Galloway, he's an NYU professor, I believe, he's written a whole bunch of books. Hey, JD Vance, I'm sorry, go ahead. Yeah, yeah, yeah. This was after though.
But it was interesting because he was promoting the draft. And, you know, and again, from forcing people of different cultures to work together, to be teammates, to understand what the rest of the world looked like. But the other stat that he had was that there was a transfer of wealth, which is certainly confirmed by the slide and I've got other ones that we can put up there as well. And I don't remember the exact number, but it was in the 20s.
So it was like 25 or 26 or 27 percent of the wealth has been transferred from younger generations to older generations. And speaking of what, all white baby boomers here, and he was as well, is what are the implications of that? That there has been a transfer of wealth, and we talked about the transfer of wealth going from older to younger in the past through estates and people passing it on. But for the living, the people that are trying to live paycheck to paycheck or day to day, the wealth transfer has been from the younger generations to the older generations.
Right. I mean, I mean, monopolize here. You talk to young people on millennials and see, and they're, you know, they talk about, they're now going to point where it's like, I'm not sure I'll ever own my own home. You know, all of the money in my health insurance has gone through the roof.
All the money is going to the older generation. There's a level of resentment there. I have to agree with part of it today, the truth. Yeah, but doesn't that depend on the demographics?
You know, and I guess that's the issue is, you know, I just came back from a cruise and, you know, I'm a formerly in a position to be able to do that. And we ended up in Boston, and, you know, Sunday we had the opportunity to meet some family up there, and then I'm looking over the seaport. And it's like, what economy? Like, what gap?
Because there's a whole lot of expensive boats and buildings, and we're walking down, and there was a for sale sign on one of the new buildings went up, and it's a 2,000 square foot, they call them homes. They're not even condos anymore. They got a few times a square foot home for $4.8 million. And it's the last one.
And we so we, there's just, there's a lot of it. You didn't buy it. I know. I did not buy it.
But it's crazy. I mean, it's so we have this, you have it on one side how we're prosperous. And on the other hand, we've got a group living paycheck. I want to come in here, and then Jeff and Matt will have an interesting take on this.
The numbers you referenced there for 2023, they also signified the widening of the wealth gap. I think the opportunity went to 70% and then the loyalty expanded out. But there's a lot of theories on that that a lot of the widening gap was fueled by excessive COVID spending, a money few pumped into the US economy trillions by the Federal Reserve. And so it benefit those at the top tier, their equity holdings and public companies are bailed out.
So we don't know if it's temporary blip or not. But this is pretty disturbing because I think the bigger point that Jeff makes in his book is that we don't have to stable middle class, a strong one. We risk anarchy and revolution. And in some people believe we're on the verge of some kind of anarchy or revolution, if we don't have a satisfactory outcome in the coming election, my final point just to add to the horrible statistics, a recent survey by Intuit Credit Karma said that 27% of Americans are skipping meals because of skyrocketing food costs.
According to the same study, many are changing their food shopping habits. About 37% say they are now shopping at this kind of gross source. And you have to remember how the CPI is calculated. If consumers shift from one popular product to another in the meat category, they fed automatically recalculates how inflation is produced.
So actually, if they were going by the initial gods that people have stopped buying, inflation would be probably higher today than the 3% of rises are still rising, by the way. Yes. I wanted to pull up something, Jeff, and curious in your take on it on how it applies to your book. I pulled up the latest Gallup poll.
I guess they do this monthly on economic confidence in the country. And right now, they said 76% of people rate the overall economy either poor or fair. It's 48% say poor, and then the other 26% say fair. But then when they're asked about their personal economic conditions, only about 5% say fair or poor, 80% say excellent, and 15% say good.
So, you have this massive economy of I'm fine. It's my neighbor that's not. Or actually, they actually have the other question. They rate the community.
And they rate 75% say the community economy is good. But they think the national economy is the one where it's bad. So it seems to be like there's a big disconnect between these data. And when I like about the chart, I'm going to go and grab your book.
I don't know if I ever pulled that chart from your book or if that was something else you came up with. But I also noted what John noted was that the number of people in the upper echelon grew as a percentage of people. And so it seems like is it possible that the data and our feelings are just totally too shits passing the night? Yeah, you mean that it's the publicity and the just kind of the imagery, if you will, that things are bad, but for each of its veterans.
Look, it's a great question. The one about the statistic about people feeling like they're fine. It's kind of hard to believe, but it is what it is. But anecdotally, when you just talk to the average person, average American citizen, this whole the impact of inflation, I think it's real.
And those of us who are fortunate enough to have the kind of things that I was talking about, inflation has affected us. But in some ways, it's good. I mean, it's made the value of our property go up, right? It's done.
It's made our stock portfolios go up. And the person that really doesn't have any of that is dealing with what amounts to around 25% that increase in the last three years. It makes a difference. And I think those statistics a lot.
I do think that the amount of money that has been pumped into the economy, as John was talking about during and slightly post-COVID and the fact that we're continuing to run these huge deficits, I think that money is being pumped in the economy. And I think we're just kind of kicking the can down the road here to what could be a really really tough situation. And when that kind of tightening takes place, we all know who gets sort of the worst, right? It's going to be those people in the middle class and the working Americans.
So it's going to be interesting. I think it's it has not played its way out yet. I think the interesting one of you, there's many interesting lines in your book, but the one that stood out to me and it maybe summarizes the entire theme, your words. So long as big business and big government stay connected, American free enterprise and American freedom are in jeopardy on page 76.
Yeah, I mean, it's just whether you believe it or not. And as they say, it depends on who's Ox is being gored, I guess. But I think, again, we see more and more of it. Look at the some of the companies, especially the tech companies, you look at, you know, even someone who admire Elon Musk, you look at, I mean, Trump is right when he's probably not saying it now.
After the announcements in the last week or so with it, you know, Elon Musk, well, much of it has been created through government subsidies for many of his companies. And I just, again, especially, I think that to the extent that we can really create an environment where small business can thrive again, where we can have more entrepreneurship, more innovation, more creativity, you can't prove it, but just intuitively, seems like that would really be a good thing for our country. I think you can prove it. And you're going ahead, Matt.
No, I think it's proven. I mean, you look around the world and there's a strong correlation, once you get away from oil countries between lack of regulation and prosperity. And there is a reason why Hong Kong got extremely wealthy being hands off on clave of the United Kingdom. And there was a reason that Singapore started off as a backwater, I don't know what it was of the United Kingdom.
And you know, it's probably one of the richest, if not the richest country on earth using free market. And as a society, they also show that they can do it while having immigration and while having, you know, people who aren't born there coming in assimilating and being part of the society and contributing to the wealth and creation of the society. So I agree. And I also think, you know, you can prove it by looking at the differences in states.
So one of the great things about America is the state situation. We're not one country, we're 50 states. And you can look at states. And I think it's a really compelling argument.
When I hear, you know, Gavin Newsom defend heavily California's success, in spite of what, you know, people from the outside look at as, you know, tyrannical laws, but all of the richest countries in the United States of America, you know, aside from Microsoft Amazon, but they're in high-tax states too. But, you know, Nvidia, all of all Teslas, all of Elon Musk's companies started there. I know that he's moving into Texas, but California does have a long, long, defendable track record of building massive, massive companies. And they're doing something that's working that also doesn't necessarily seem to be aligned with, we need to have small business favors because there's nothing in California that seems to favor small business, believe me, I haven't pleased there.
No, it's an interesting fact that so many of those companies are beginning to leave now and have left. But you know, again, listen, it doesn't take that spending much time. People haven't spent time in California go there for the first time, look around and you've got to climb it and you've got the other mountains and no bugs. And it's like, this is going to be a great place to live and millions and millions of people live there.
But you're right, a lot of the big companies are either headquartered there or started there. But I think that, I don't know, it's going to be interesting to see what happens over the next 10 years with this migration of companies to Texas and Florida, Tennessee, places where taxes are low and they're very business friendly. It's so again, I think it's going to be interesting to see how the trend plays out. You mentioned, Jeff, about how in 2017, I think it was Trump had some kind of a symbolic ceremony about cutting Fed regulation.
And I think the number of pages that his age calculated, constituted the number of regulations in America came to it fast, 185,000 pages. Nobody in the right mind could go through all that, no attorneys. The whole thing was Ron and Mark, and he vowed to get that way, way back, maybe back to 20,000 pages and to simplify the language. And you do make a compelling case that the less regulation there is, the more prosperity there is.
And the ordinary, I shouldn't use the word ordinary, but a lot of Americans are not aware of that, that when small business tries to start up, many of them are deeply discouraged because they say, what the heck is not worth all this red tape? And many of them fail because of the red tape. Even if they get started, that's right. When I speak to young entrepreneurs, we talk about, when I go through the story of building the company that I built from scratch, I always say at the end, it's like, I do think that in some ways it's easier to start a small company now, especially tech.
You don't need a lot of people and all of those to that kind of complexity. But on the other hand, as you begin to scale that business, I think your regulations make it tougher. I think it's harder. And I think that I think we're probably going to see if if Trump is elected, and if there's not a new brushy gig, which I'm sure there will be, I think you're going to see a lot more aggressive whacks at the federal bureaucracy, regulations, the federal budget, and so on.
I know that's a claim. You have to remember, Trump never expected to get elected. They didn't have any they didn't have any bench ready to go. So I think you'll see a lot more if that happens.
Do you think how do you think interstrate policy affects the middle class and what we're talking about today? I think it's well, obviously interest rates affect the economy and good, as far as growth in the economy. And I mean, we can talk about whether we really should have had 20 years of lower interest rates and what the long term effect of that's going to be. But again, look at what our home mortgage is now.
I mean, it's just, you know, you get again, the three major issues for the man on the street are, you know, it's groceries, it's gas and it's housing. I mean, that's what they're thinking about. And that's where they're affected most by day to day. So I think that it's a very good question.
There's no question that high interest rates, if they're high for very long, they're going to have, they're going to have an effect. What it's done so far, I think is kind of arguable. But again, I go back to these young people and the number of people that feel like that they've kind of gotten a bad, you know, they've gotten a bad draw when they came along and when all the different crises they've developed, they've been in the middle of it and been affected by it and whether they will ever recover or not. You know, I think there's a lot of concern.
I could, there's a part of me that wonders how going back to my first question on the gap between people, you know, talking about themselves and then talking about others, amongst young people who are, you know, you listen to Scott Galloway and he's, he presents such a compelling, just tight synopsis of why younger generations are, I don't know where we'd be, I don't want to call them bitter or whatever, but like they feel like for some reason that they've been left behind. And then I'm in the securities industry and we go to these conferences and all we talk about is the mountains of transfer of wealth that's going to happen as the greatest generation is, you know, moving on and then the baby boomers start dying and passing on, passing on this immense amount of wealth. And you know, you can look at different charts depending on how they angle them. There are charts out there that show millennials are just as wealthy on average age 30 as their parents were as we were as anyone else was.
And a lot of this is just perception and then not only is it just the perception, but the perception doesn't match the reality. You know, my kids talk to me about, like, oh, when you were growing up, was it cool and you got your first color TV and like, you know, yes, the technology has changed a lot in my lifetime. But my parents were there, my grandparents didn't have TVs and my grandfather didn't have indoor plumbing. You know, my parents had TVs, they had cars, they had, my dad talks about how he used to take a cruise ship to go to Europe because they couldn't afford to fly.
And now it's no big deal for even the lowest middle-class family to plan a trip to Europe. We all have, you know, the entire world body of knowledge and and news real time in your pocket. Our society has an abundance of calories so much so that when I was growing up, we used to do fundraisers to, you know, to feed the starving kids. And now it's all about obesity, even in Africa, even in Asia, I know there's pockets of poverty throughout the world and stuff.
But I just wonder if there's just a disconnect between people's live lives because our lives are actually pretty darn great. Yeah, yeah. Well, you have medical care so much better now than it used to be. I mean, with all the advancements there.
So there are those basic things that you make a good case for that. But it's certainly true that most of them feel like, like he's like, maybe some of his perception. I know, I know one of the things I hear a lot about is kind of what's happening with social security, the medical care insurance rates that they're just so high and that all that money for medical care is being transferred to take care of our generation, if you will. And it'll be interesting to that there is some.
Some of what Matt was saying may be related to a kind of a, I go back to it all the time, this moral relativism that has crept into our culture, the walkism, if you will, and by the way, Charlie Gasparena was a new book, I was a new book, broke its great context. And you know, you know, a kind of a despair because you're right, things ain't too bad. I wanted to ask you, although there are definitely pockets of poverty, let's be very clear about this. But Jeff, you mentioned tariffs in your book, you have a special section on fair trade and fair trade.
And you're going to get beaten up by some people on this because those fears now that if there are tariffs imposed under Trump, it'll lead to more inflation. But I think your argument is that it's done strategically, it protects us all. Well, I think that's right. I think it's, you know, it's like most things, right?
It all comes down to execution. Again, the one thing I'll say about Trump is that he knows how to make a deal. And I think that I think that he's smart enough to let smart enough people around him where the application of these kind of targeted tariffs, you know, in the long run, certainly, who knows in the short run, will be balanced. And I think, and I think good for good for us.
But who knows, it really just depends. I mean, tariffs can be used, they can be weaponized, and they can even, even with the best of intentions, they can end up hurting us in the long run. So I think it'll have to be very targeted and analyzed the right way for the short term and the long term. But I do think, but also, again, I know I'm sounding like this, I guess this because I just came back from Milwaukee, but J.D.
Vance's story is remarkable as a person. And, you know, coming from Appalachia and talking about the ruin that happened with the loss of manufacturing jobs and what that did culturally to the people in those small towns, the drug use, just the lack of the ability to have a job and do the things that need to be done to move forward. So I think that there has to be some type of balance. And, you know, it's going to have to be in this country, we're going to have to have, I believe, even with AI and even with technology, what it is, we're going to have to have manufacturing in this country.
We're going to have to have good jobs for average people. And I think we can do a better job at it. And I don't think there's a silver bullet, you know, I don't think so. But I think you kind of have to get started and you have to have that as your as one of your objectives.
And I think it's that yes, the pie can get bigger, but we've got to make sure that everybody gets to benefit as things move along. Easier said than done, I understand. But I think you got to start with that. Beyond Paris, which is beyond the scope of what a lot of people would even understand, but that means and how it affects it, you basically went through almost step by step.
You went through a number of different changes of how we got here, you know, and if you don't fix the cause, we're just treating the symptoms. So there's a number of different scenarios that you shared in your book that you outlined saying how do we get into this situation? How, why are we having this conversation today? Why does it matter?
Can you highlight, you know, what you feel are some of the strongest points there that, you know, if you had to prioritize your list. That about how we got to this discrepancy. How we got here, which is the causes and then, you know, what some of the remedies might be. Yeah, well, look, I think that I think that I keep putting this at the top of the list now.
It's evolved to the top of the list. I am scared to death of the national death and where we're going with no with no solution with no end in sight. And very few people even talked about it, right? And how do we get out of that?
When you talk about something that we're leaving to our children and our grandchildren. I mean, I read the other day that the that in 2025, that the next the interest payment on the national debt will be a trillion dollars a year. I'll try what could we do with the trillion dollars in this country? What could we do really for infrastructure?
What could we do to invest in the future? And I think as that is interest on the debt that continues to expand and it takes money out of kind of the normal operating cycle within our society. I think it's a huge problem. And I don't think there are too many ways to pay back that debt that are going to be, you know, less than painful.
I mean, you know, something like this, what you inflate the currency? Well, we're seeing what happens there, I guess a little bit now. The company go bankrupt to start over. You can't do that.
I mean, I actually think Trump has the best idea and that is drill, baby drill. I mean, back to the oil, the hydrocarbons, oil and gas, and the reserves that we have in this country, more than any other country in the world, to the extent that our country could be selling oil and gas, which is going to be here for a long time to the rest of the world. I think that's I think that's the best solution. But the national debt, I think also what's happening now, we didn't talk too much about this in the book, I think what's happening with our colleges and universities and their inability to keep up with.
And this is not all of them, keep up with what's needed for our society going forward. I also don't think they're very doing a very good job of teaching our young people about the history of our country and our economy. And to your point about less regulation, more free markets, things that got us to this point. And there's just, there seems to be this lack of general direction and how we're going forward and how we're going to get better as a society.
But I think the natural, the national debt is a ticking time bomb. I want to challenge you on that one. Okay. First off, I don't think, I try to be contrarian when I can at least put forth a good foot on it, but I'm not necessarily trying to take the other side.
Japan has national debt of around 300% debt to the U.P. And they've been above 120% debt to GDP for 30, 40 years. And everyone's been calling through the end of Japan or like, this is the year when the end finally goes to 300. This is, you know, and that's the first example you have out there.
And it doesn't seem to have mattered to Japan for at least three or four decades. Second, we are not any other country in the world. We are the US dollar. We can print the US dollar.
Your point was you said, I don't know how they plan to solve it. Well, there's actually a bunch of plans to solve it. Most of them are wackadoodle. But they do work.
They do work. And the reality is, is one of the reasons we have such huge national debt isn't necessarily all due to Congress. It's also due to the ban. It's also due to how we've structured the global economy in the sense that we are the global reserve currency, some like 90% of all cross border transactions that aren't into a Europe use the US dollar or currency as reference to the US dollar.
And a lot of people hold US treasuries, not because they're long term believers in the United States, but because they don't anywhere else to park for money. And one person's debt is another person's asset. And so treasuries, you can look at it the opposite way and say there's $35 trillion of treasuries out there held by people who are believers. And they hold it because it's the great place and especially today's interest rates, it's a great place to hold money.
And so I just wonder like everyone uses I guess household accounting when thinking about the national debt, but it's actually something else. The national debt is assets and it's reflection in the United States. So I just wonder if maybe you're not being a little bit too negative on that. Well, I probably couldn't, I'm pretty conservative.
And I know how I feel about debt. I don't have any. I never have had any, thankfully. But I do, again, I go back, is the debt gets larger, the interest payment is going to get larger.
And let's interest rates come down again, which we can argue about whether that's going to happen or not. I mean, it has to happen. But at what point, and what's really happening with inflation is that thank John was saying a minute ago, prices are still going up. I mean, we see it every day.
And is it going to become normalized? Or can we live with this level of inflation over on and on? But I do think, I mean, I do think, I hear what you're saying about people investing here, Matt, and they're being up being, our debt being kind of an asset, if you will. But at the end of the day, it's still is that it's going to have to be paid somehow, some way.
And I, you know, we don't have the answer. As far as Japan is concerned, my only push back there is I can remember when Japan was leading the way in all type of innovation and business and manufacturing. And, you know, they're okay now, they're good, but they're not what they were. I mean, we were all trying to emulate Japan and the way they did business and the way they ran factories and everything.
And even though they're doing pretty well when it comes to automobiles, you know, I think that I think that their leadership is slowed down to some extent. So let's get something in here, which was very interesting on Labian in Washington, DC, which you cover in Jeff and your book. And you mentioned the lot of Americans don't know about this. The 1984 Chevron deference ruling, if you will, or decision of the Supreme Court, which is effectively introduced, Labian as an industry into DC.
And you come up with some number, I don't know where you got it, like an average of $3 million over a four year cycle is given to each Congress person. Now, it may not, maybe not individually. And that's highly detrimental to the functioning of a healthy democracy and it's on due influencing. And it really takes, it really hurts people in the middle of middle class, ultimately.
Yeah, I mean, people have been buying favors for a long time in government, right? But the matter is that, well, and by the way, on Chevron, Chevron being overturned to some extent, in the last couple of weeks kind of got lost in the shop of the moment, right? Because people don't really understand it. And it's pretty complicated.
But to the extent that we're, we allow non-elected government officials who can't be fired pretty much to actually have more to do with how the laws are applied once they've been made in a general way by Congress, people don't understand what a negative influence that has been on our society. But I do think that, I mean, look, look at all these people that go to Congress and are very, very, not affluent at all. And they spend 10 or 12, even more years there, they all retire multi-millioners. I mean, they just do.
I mean, somebody should look at Paul Ryan, for instance, if you want to take a good look at that. But it happens, and you're right, does it really, it doesn't always go directly to them and they go to their campaign? They're all, it's very common also for these, you know, first of all, these, these Congressmen here about plans and what we're doing and what the next big construction push is going to be. So, you know, so they end up with their family members, you know, involved in bidding on big projects or their best friends, and then they go on the board of that company.
I mean, the one of the term limits to me would be one of the most positive things that could happen in this country. And we should say, well, we can have changed because, you know, we can do it at the ballot box. Look at the number of people who have encumpts, the percentage of encumpts that are reelected every time, every time. And, you know, we can argue about, you know, how long term should be and whether or not having somebody there that has experience is important.
I just think you have to look at some of the problems that have been created. And I think that having people with almost a lifetime of employment in the government is not a good thing. And I do think that there is kind of this wealth transfer there. I think it's unfair.
And I think it hurts in a lot of different ways. We're coming up toward the end. And I'm sure there's a million other topics that we can go down. What I'd like to do is just go around the kind of circle here and ask, you know, start with John.
If there was a question that he hoped we asked, but we didn't. And then hopefully somebody else can partake in or participate in response. We just enough time to, you know, drill even deeper in Jeff's book and his thoughts, because he mentioned one of his themes is consolidation of power in American industry and financial services. And there's a really striking stat on the banking industry.
At the time of the financial crisis, there was what 7200 commercial banks. That was in 2007, 2008, in 1985, there was 14,000. The number of commercial banks is even stronger, even further still. And you say that the big banks get too much of a pass, too big to bail banks, have a monopoly position and it hurts the middle class.
I think so. I mean, you know, listen, I have my own own shared experience in the NHS, by the way. But I do believe, you know, I think it's big as bad as what we say on the John, but I do think that that the banking industry is a good example. I mean, you have less competition, you have more power and a smaller number of institutions.
And what industry, what company should be too big to fail? I mean, how the hell do you have the kind of discipline you should have if you know you're going to be bailed out if you make bad decisions? I mean, it's like, you know, what we saw, you know, with mortgages and I would suggest what we've seen in the student loan business, by the way, where, you know, you again, the people at the end of the line, the people who really end up you know, financing all these things are going to be bailed out. And it's just, it's not, it's not reasonable to think that people are going to make the kind of decisions we all have to make when we make our own decisions and take our own risks, when we weigh out risk versus reward.
So I kind of feel like that's more of a cycle, a cyclical thing of, you know, going back to even the founding of the country with Alexander Hamilton, we started with a totally different economic system where everyone had local banks and those banks issued local currency and there was an exchange rate if you want to go from B.C. to New York, I don't exist at the time, but if you're going to New York, you had an exchange rate and you know, you can take it all the way to Andrew Jackson with the second bank of the United States and him shutting down that charter and you bring it forward to, you know, JP Morgan, not the bank, but James Kirpont Morgan, the man, you know, kind of doing the role of a Federal Reserve Bank in the 1910s during the economic crisis before the World Warring 20s, you know, and then you had Glass-Steagall, which was, you know, kind of in response to that, and then you had the repeal of Glass-Steagall and so then you have the financial crisis and you have the new regime, we're in with four or five, two big to fail banks that are really, I agree, doing huge economic distortion because what they, what they're kind of incentivized to do is to grow their balance sheets and take free money knowing that they're going to be built out, whereas the traditional role of the bank was to create money through loaning, loaning, and having a personal relationship with the community that they're in and now you have five of the top biggest banks, I can't remember it, I think it's like some of like 50 or 60 percent of the deposits are in five banks, which is basically one bank, I mean, because they're all under the same special rules and so I totally agree, I didn't mean to hog the floor and take big names from John, but I totally agree. Great explanation. My question would be, you know, when I feel like my real question, I have is do the definitions count anymore and I go back to this LBJ stuff of Warren Poppy and there's a good definition back then, I don't know what it was, there's probably like a dollar a day or something like that and and you know, you look around and my daughter, my kid's schools, we do a lot of charity work and we go to various areas where you help people who are of need and I'm not sure I'm going to the worst places, I'm definitely not going to Appalachia, I'm not, but we everywhere we go, the people who are poor that were helping out have air conditioning, have cars, have TVs, have plenty of food and you know, I listen to my parents talk about like, especially my dad when he took a road trip across the south in the 1960s, early 1960s before, you know, before the civil rights acts were passed and before all the changes and he would describe to me poor, like no shoes, kids are running around with no shoes, they have an outhouse, they're drinking dirty water, they can't afford to go to school because they can't afford like, I feel like the definition hasn't kept up and today's poor, live better than 99 percent of the people did in 1900 and then we're like, oh but the poor, but they're poor, well are they really that poor is it just in my head and it's like and you want to have empathy and we're not actually giving society credit for how much progress that today's poor, broadly speaking has access to health care, access to air conditioning, access to clean food, access to clean water, access to transportation, cell phones, I mean I live in New York City and I walk around and you see the homeless people and it's awful, but homeless people, they used to go for shelters, now they go for where they can find an outlet and charge their device overnight, so I just wonder if the definition hasn't quite kept up.
Yeah I think some of that too is a social breakdown, social delays, family breakdown, the fentanyl crisis obviously, on changing social and cultural and more and the law of rising expectations, each generation feels they deserve more than the previous, so we have to reestablish some kind of a in-you-norm as aware. I would just say to Matt and to everybody, I'm on the board of the YMCA, regional YMCA and I can tell you that there are children that do not get fed, there are children that are homeless, there are people, there are, I guess it's word elderly but I'm considered amongst them. Does that do the lack of resources or is it a allocation of resources? Yeah the issues that are being worked on are lack of affordable housing, which is a huge problem.
The only way that children, that many, many young children receive meals, any meal during the summer is through nonprofits and the Y and feeding programs because there is no food at home. So it's, again it's getting into certain areas but they've almost been isolated areas. They're almost protected, almost camps and a lot of them are in the cities but I live in Lehigh Valley, so we've got pockets of that in Allentown, Pennsylvania. We've got it in Bethlehem, Pennsylvania, we've got it to East in Pennsylvania, you have it in some of the small communities.
So it's there but it's usually, oh it's in a particular part of the city and therefore it's isolated and you don't go there, so you don't necessarily sit it and that's sort of, I mean that's the Appalachian, I mean I grew up in in the northern parts of Appalachian, the coal mining town. We used to have 12,000 people thriving downtown. Now it's infested literally, it sounds like JD Vance. I mean it is at this 5,000 people and the biggest industry is probably drugs, in fentanyl and it was really, my classmates will still say it's the best place we grew up in the world but it's really not the ideal place anymore but they weren't foreign immigrants.
I mean it was they were coming because it was cheaper than doing it in North Philly, it was cheaper to move to the coal regions and manufacture and do this stuff. So yeah it's a challenge but it exists, Matt. Yeah. So there was really poverty.
Yeah. There was really what I really agree with your definition because when I looked up the definition, when I started to research this and and get more, not that I was aware that the middle class was shrinking but not the extent that Jeff has exposed is that when you look at what the range of how they define middle class, it went from like $47,000 to $187,000. I mean I can, you know, and again it depends on where you're living. Yeah but $47,000 isn't a lot to live on, almost anywhere.
I mean there are discrepancies between that and living in Manhattan but there are discrepancies there and so I think, I think your question is incredibly valid that we need to take a look at these definitions of that and again and there's always this asterisk after middle class depends on demographic and geography. I think in that chart, maybe I'm remembering it wrong, I think it defined it as anyone living below two thirds of the median income line. Yeah. If you're going to use median income as your starting point, you're always going to have statistically people below that.
If that's what you're measuring then you're never going to succeed because there's only going to be a third of the society has that level of income. Yeah. One thing too, I think you were talking about allocation and John you were talking about the cultural effects. I mean, we look at much more money we spend in trying to address this issue.
I think the question becomes how are we spending that money and I think you're right about drugs being number one with the number one industry in a lot of these places. I agree with that. I just think that, well again, what we're going about poverty is a much bigger conversation. I guess.
Exactly. I agree with poverty. We see it at the food banks. Nobody wants to be callous or it's a real problem obviously.
But Matt's question was very valid. Yeah, I know Matt needs to log off. But Jeff, what's the question? And Matt, if you need to go, we appreciate it's always great to have you and appreciate you to be here.
We'll be back next month, hopefully with another conversation. But I want to give a fair time to Jeff too. So Jeff is something that you needed to you wanted to ask that we're when you wanted to talk about that we didn't. No, I think look, this has been a great conversation and you know, it's a conversation that will never end.
You know, and I do feel like there's we can we can look a lot of the charts and numbers statistics we need to do. But there's also there's this intuitive there's almost this intuitive sense about what's happening to these people. It's a lot of us anecdotal. I try to talk to as many of them as I can.
And whether it's the fact that this perception that things are getting worse or they really, I guess we'll never really know. But I do think that I think that what's happened with inflation in the last couple of years is such a negative impact on their psyche. And one would assume they're actual wallets, but that's they're starting to there's not the same sense that they're going to have the same level of opportunity that people have had in the past. And that's something that we have to address all the way around whether it's reality, whether it's perception, whatever, in order to keep the country, keep the middle class doing what it's done for our country and our economy.
There has to be a positive attitude sense that I can do this. I can achieve more. I can do more for my family. And that's what slipping away.
And I think it's dangerous. Yeah. And I think despite everything that's going on there, there's a recognition that there's a huge difference between data and emotions. And you know, that's what we're talking about with deflation and hopefully that recognition that we need to listen to how people feel and not with the data, you know, not with the data reflex and all the time.
And I've got one last quick question for you, Jeff. This is probably the compelling question that we didn't talk about. When will we see cheerleading in the Olympics? You're talking about my other life now, right?
So, you know, that's a that's a that's a there's a long answer to that. And the I'm going actually going to be in the affairs, the IOC meetings next week. But you know, the Olympic Games, people don't understand there. It's not that it's political.
It's the fact that there's a set number of athletes and coaches they call it and the trainers they call it entourage. They can be in the game. So that's a lot of its costs and so on. And so for somebody to go in, somebody has to come out and all of those international sports federations will fight to the desk to stay in there.
But you know, we're we're we got to we got recognized as fast as any sport ever. Incredible. We you know, we've got a sport that's that's this huge, young is for you know, all genders, all body types, it's entertaining, it's telegenic and involves music. It fits the bill of what young people are looking for.
You know, so we're we're doing everything we can to get in as soon as we can. But it ain't easy. Let me put it. It's a it's a great story.
I know there's so many people that I know that you know, I was shocked when people said, Hey, every weekend they're going to a cheerleading competition and it gave a lot of people both young young girls and young boys an opportunity to do something that you know, if they weren't good at baseball or basketball or soccer, they had another opportunity. So he created a huge opportunity for people. Jeff, what's the best way to get for people again? Touch with you?
You know, the best thing I've done for especially on things like this is JWAM at humanevents.com. Okay, and your book's available up on Amazon. Encourage people to go up and get that. We want to thank you.
I know you had a incredibly busy schedule got up really, really early and I appreciate you beating your commitment and being here with a great conversation. Great to see you. And before we log off, I just want to make sure that we acknowledge Security Traders Association again. You can go to their website at securitytraders.org and get information about the organization and also their upcoming annual conference, which is focused on shifting the landscape, which is what we've been talking about today.
And until next month, don't let the shift hit your plans. Thanks for watching Geeks, Geysers and Googleization. Be sure to listen to the podcast and follow us on YouTube.