The establishment continues to dismiss the growing support for socialism among young people as nothing more than college indoctrination. That is only part of the story. If we refuse to understand why an entire generation is losing faith in capitalism, then we are destined to repeat the very mistakes that gave rise to socialism throughout history. The Fox News analysis citing Heartland Institute and Rasmussen polling noted that 53% of Americans aged 18 to 39 said they would support a Democratic Socialist for president, while 76% favored nationalizing industries such as health care, energy, and big tech. The overwhelming motivation is not ideology, it is economic despair.
Young Americans have entered adulthood during one of the most distorted economic periods in modern history. Housing has become unattainable for millions. According to the same polling, 74% of young voters believe America is facing a housing crisis, 62% say the economy is unfair to young people, and 36% describe themselves as struggling financially or in outright crisis. When asked why they supported democratic socialism, the most common answer was simple: housing costs. This is precisely what governments never want to admit. People do not abandon free markets because they suddenly become Marxists. They lose faith when the system no longer appears to reward hard work or provide a realistic path toward owning a home, raising a family, or building wealth.
This is hardly unique to the United States. Across Europe, Canada, Australia, and much of the developed world, younger generations face soaring rents, stagnant real wages after inflation, enormous student debt, and some of the weakest housing affordability on record. Many graduates cannot find careers matching their education, while others remain trapped in temporary work or are forced to live with their parents well into adulthood. Governments spent decades inflating asset prices through endless debt expansion and artificially low interest rates. Those who already owned homes and financial assets became wealthier, while those entering the workforce found themselves permanently priced out. That is not capitalism functioning properly. It is the direct consequence of governments manipulating markets and accumulating unsustainable debt.
The politicians will blame corporations. Universities will blame capitalism. The socialists will promise that government ownership is the solution. They all conveniently ignore that governments created much of this crisis themselves.
History demonstrates that socialism gains support not when capitalism succeeds, but when governments corrupt free markets until ordinary people no longer recognize them. The Roman Empire followed the same path, debasing its currency while expanding state control until confidence collapsed. Every sovereign debt crisis eventually creates demands for greater redistribution because people become desperate. We are watching that cycle unfold once again. The danger is that socialism will not solve the underlying problems of debt, declining productivity, or demographic collapse. It merely transfers more power to the same governments whose reckless policies created the crisis in the first place.
All are welcome to attend the upcoming seminar I am hosting on July 25, Understanding the World Economy. I’ve spoken to a number of people who said they are bringing their kids or nieces/nephews. If you have teenagers or young adults in your family, bring them along. Schools teach theories, but they rarely explain how the real world economy actually functions. Understanding capital flows, debt, history, and the cycles that shape society is knowledge that can benefit every generation. The sooner young people learn how the world truly works, the better prepared they’ll be for the future.
The Federal Reserve minutes from the June 16–17 meeting showed policymakers divided over where interest rates should go next. The official minutes admit the problem plainly. Inflation had “increased further and remained well above” the Fed’s 2% objective, while officials blamed tariffs, supply disruptions tied to the Strait of Hormuz, and demand from the AI boom. That is not a normal business cycle. That is government-created chaos colliding with war, energy, trade barriers, and capital flows.
The Fed voted 12–0 to hold rates at 3.50% to 3.75%, but unanimity on the vote hides the split underneath. The minutes state that “a few participants” saw a case for raising rates immediately, while others thought policy was already “slightly restrictive.” That is central-bank language for confusion. They do not know whether inflation will fade or accelerate, because this is not simply consumer demand. The old Keynesian playbook does not work when prices are being driven by tariffs, war risk, energy shocks, and government deficits.
The minutes also said “many participants” believed elevated commodity prices and supply disruptions could persist longer than expected. That is the key. They keep pretending inflation will return to 2% if they wait long enough. But confidence is collapsing in government itself. Rates are not rising merely because the Fed wants them higher. Rates rise when capital demands a higher return to buy government paper. That is the part the academics never understand.
The Fed even admitted the ownership of Treasury securities has shifted away from “price-insensitive official-sector holders” toward “more price-sensitive private investors.” That is a major warning. Foreign central banks are not absorbing U.S. debt the same way they once did. Private capital wants compensation. This is why rates can rise even with a weakening economy. It is the sovereign debt crisis creeping into the room while everyone stares at CPI.
Warsh is now trapped. Trump may want lower rates, Wall Street may want lower rates, and politicians always want cheap money. But if inflation reaccelerates, the Fed will be forced to raise because Keynesian economics is the only model they have. They will not admit the real problem is fiscal. They will not admit Washington’s endless borrowing, tariffs, war spending, and regulation are creating the very inflation they claim to fight.
The minutes removed the prior easing bias and said the Committee “will deliver price stability.” That sentence is important. It means the Fed is preparing the public for the possibility that cuts are not coming. The split is no longer between hawks and doves. It is between those who still believe inflation will magically fade and those who can see that the system has changed.
This is what I have explained many times. The Fed does not control the entire yield curve. It can influence short-term rates, but it cannot command global capital. If capital begins to distrust government debt, rates rise. If war escalates and capital flees Europe, the dollar can rise with gold. If inflation comes from energy, tariffs, food, and supply shocks, crushing small business with higher rates will not solve the problem. It will only expose how fragile the debt system has become.
Lithuania, Estonia, Latvia, Poland, and Greece are projected to exceed NATO’s new 3.5% core-defense spending target this year, nearly a decade ahead of the 2035 deadline. Lithuania is projected at 5.33% of GDP, Estonia 5.1%, Latvia 4.92%, Poland 4.68%, and Greece 3.65%. These are not small accounting changes. This is the militarization of Europe before the people have even been asked whether they want this future.
NATO pretends this is about “security.” Governments always use that word when they want unlimited money and no debate. The old 2% target was once treated as unbearable. Now they have moved the goalpost to 5% of GDP, 3.5% for core military spending and another 1.5% for cyber, infrastructure, and anything else they can stuff into the war budget.
The nations closest to Russia are spending first because they know Brussels and Washington have turned Ukraine into the excuse for a permanent war economy. Poland and the Baltics are not waiting until 2035 because they understand where this is going. But the real question is never asked: who benefits? The average European cannot afford housing, food, energy, or basic living costs, yet suddenly there is endless money for weapons.
Reuters reported that total NATO defense spending is projected to exceed $1.8 trillion in 2026, with the United States still accounting for nearly 57% of the alliance’s military expenditure. So even after all the lectures about Europe stepping up, America remains the piggy bank. This is why I have said the United States should get out of NATO and let Europe deal with Russia if that is the future they want. America’s real strategic threat is China, not financing another endless European war.
Germany, France, and Britain remain below the new 3.5% benchmark, while smaller nations on Russia’s border are racing ahead. That tells you the whole story. The countries that feel exposed are arming. The larger European powers are talking. Brussels wants a European army, NATO wants more money, and the people get the bill.
I have received numerous requests to host a technical training conference similar to those I conducted in the 1990s. Those sessions were intensive—and at $5,000 per seat, they were not inexpensive. By today’s standards, however, that would be a bargain. Consider that DAVOS currently charges between $27,000 and $35,000 per attendee. I am giving this serious consideration, particularly because I recognize that the need for such training has become urgent as we approach 2032. That said, it is a monumental undertaking. I would need to author an entirely new textbook to accompany the program. Let me reflect on it.
PS Thanks for the photo of my badge from New Orleans
COMMENT: Well, Marty, Socrates is right again. You even had the week correct. Trump just announced the end of the ceasefire and cannot escape this unpopular war. It is so obvious why mainstream media will not quote you; Socrates puts everyone else to shame.
GH
REPLY: Trump is trapped. He cannot escape without admitting this was orchestrated by the Neocons, and it is Netanyahu’s war. I will write to President Trump. I seriously doubt the Neocon-Deep State will allow it to get to him. When I send it, I will let you know. Perhaps if others write in maybe it will get beyond the Deep State Bubble.
Opinion and $5 will get you a coffee at Starbucks. Socrates is unbiased and the only way to see what lies ahead.
I have created this site to help people have fun in the kitchen. I write about enjoying life both in and out of my kitchen. Life is short! Make the most of it and enjoy!
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