By Daniel Lacalle

I frequently receive comments about the strength of the United States economy and the unfairness of perceiving things as less than stellar. Is it really the “strongest economy ever”? It’s evident that it’s far from being the “strongest economy ever.”

The United States unemployment rate has risen to 4.1%, the highest in three years, which is also significantly higher than the level seen in 2019. In June, a 70,000 increase in government jobs boosted payroll employment by 206,000. One-third of job creation is public sector jobs paid with more debt. Both the employment-to-population ratio and the labor force participation ratio are below the pre-pandemic level, and immigrants account for all the labor force growth since the pandemic, according to the Bureau of Labor Statistics and Ned Davis Research.

Inflation remains persistent and citizens have lost more than 24% of their purchasing power since 2019, with a 0.6% negative real wage growth in the January 2021–June 2024 period. Real wage growth in 2024 is rising only 0.8% year-on-year.

This shows why the United States Misery Index is rising to 7.4% in June from 6.8% in January. The Misery Index, which measures unemployment and inflation, bottomed out at 6.8% in 2023 and has been worsening since then. Furthermore, the index is far away from the pre-pandemic level of 5.4%.

All these measures allow us to understand why Americans are negative about the economy. Despite messages of redistribution, social policies, and equality, the average citizen is poorer, and only the wealthy have been able to improve their position and navigate high rates and inflation thanks to investments in the stock market. While this shouldn’t come as a surprise, it’s important to remember. There is nothing social about increasing debt, deficit spending, and taxes.

The problem for most Americans is that it is increasingly difficult to make ends meet despite record government spending, or because of its negative impact on inflation and taxes.

There is a reason why we should be worried about rising discontent and impoverishment. The placebo effect of government spending on GDP is declining. Real gross domestic income (GDI) increased by 1.3 percent in the first quarter, a downward revision of 0.2 percentage points from the previous estimate and a market slowdown. The average of real GDP and real GDI, a supplemental measure of U.S. economic activity that equally weights GDP and GDI, increased by 1.4 percent in the first quarter, according to the Bureau of Economic Analysis.

If we look forward, Americans are going to have to choose between two options: further impoverishment with Keynesian policies or making a dramatic pro-growth turn where policy is targeted at improving disposable income, increasing investment, and strengthening productivity and real economic growth.

We know that it will be impossible to cut the current deficit with tax hikes. There is no revenue measure that will generate two trillion U.S. dollars per year, and it is impossible to increase taxes further without punishing investment. The problem in the United States is mandatory spending, as the CBO expects outlays to reach 24.9% of GDP in 2036, while revenues will reach a record but insufficient 18%. If the Federal Reserve continues to monetize debt, Americans will suffer from the inflation impact as well as the rising cost of housing. The U.S. dollar’s purchasing power will continue to decline. However, it is easier to create two trillion U.S. dollars of productive GDI than to tax two additional trillion dollars per year out of the existing fiscal base.

Yes, the only solution for the United States is pro-growth, pro-business policies that defend the purchasing power of the U.S. dollar. So-called social policies have only made everyone poorer and hurt the middle class.

• About the author: Daniel Lacalle, PhD, economist and fund manager, is the author of the bestselling books Freedom or Equality (2020), Escape from the Central Bank Trap (2017), The Energy World Is Flat​ (2015), and Life in the Financial Markets (2014).
• Source: This article was published by the Mises Institute

The draft is three weeks away now. GM Ryan Poles and head coach Ben Johnson have pieced together an off-season that is earning widespread praise across the league. The question is whether they can stick the landing with their 1st round pick in the draft. Current projections have the top three picks likely being a mix of Cam Ward, Travis Hunter, and Abdul Carter. After that, it gets tricky. People in Chicago want to know where running back Ashton Jeanty will end once the dust settles.

Widespread belief has been that the Las Vegas Raiders are the heavy favorites to take him at 6th overall, with New Orleans at #9 also being a possibility. It makes sense. Las Vegas’ best option right now is a 33-year-old Raheem Mostert. New Orleans knows Alvin Kamara turns 30 in July. Both teams need to think about the future at that position. Both have head coaches who like to run the ball. One thing is clear. A source told SM that those around the league believe one thing is certain.

“He likely won’t get passed Chicago if he falls that far.”

Ashton Jeanty is a strong probability for the Bears.

Whispers from Halas Hall indicate they love the Boise State star. It isn’t hard to see why. He nearly broke Barry Sanders’ single-season rushing record in 2024, nearly winning the Heisman in the process. The guy carried his team to the college football playoffs. He’s built like a brick house with power, speed, contact balance, and vision. There aren’t any truly glaring weaknesses in his game. He’s earned comparisons to the likes of LaDainian Tomlinson and Marshawn Lynch. The Bears haven’t had a back of that caliber since Matt Forte.

Try to imagine what this offense could look like with Ashton Jeanty, Rome Odunze, D.J. Moore, and Cole Kmet all as options for quarterback Caleb Williams. Throw all of it into Johnson’s offense, and you can understand why some people around the league aren’t wild about the idea. They are quietly hoping Jeanty goes somewhere else. One thing is certain. If he gets past the Raiders, the noise will get loud in a hurry. It would mark the first time in 20 years the Bears have taken a running back in the 1st round.