By Doug Casey
International Man
March 6, 2026
International Man: As inflation accelerates and the US dollar drifts toward its intrinsic value, how does that enrich asset owners while eroding wage earners' purchasing power?
Doug Casey: Inflation has always benefited rich asset owners at the expense of current earners. That's true for several reasons.
First, the earners have to pay taxes on the money as it comes in, but asset owners don't pay tax on the increase in value of their property until they sell. And then it's at lower capital gains rates.
Second, even though earners typically don't keep up with the rate of inflation, they're constantly pushed into higher tax brackets as their wages rise.
Inflation-currency debasement-enriches asset holders in the short run, but hurts everybody in the long run.
Your house may be worth 10 million dollars, but it's still just an expensive consumer good. It's Lewis Carroll's famous Red Queen effect. If prices are rising 10% per year, even a rich man has to increase the value of his assets by more than that just to stay in the same place. Your standard of living is dropping, but you may not fully realize it because you have more dollars.
One reason that the old saying, "the rich get richer and the poor get poorer", is true is because the rich own assets, and the assets benefit from inflation. That helps create an atmosphere of envy and class warfare.
International Man: At what point does the public conclude that they're working harder and losing ground ? And what will the response look like?
Doug Casey: Revolutions typically have economic causes that are later gussied up with political slogans.
The US is deeply in debt. That's true of the federal government, state and local governments, most corporations, and most individual Americans. The average person is buried under mortgage debt if he's lucky enough to have a house, automobile debt for cars that cost what houses used to cost only a couple of generations ago, student debt, and credit card debt. The trillions of dollars floating around outside the US are a gigantic liability.
When all that debt becomes unserviceable, when millions of houses and cars get repossessed, the torches and pitchforks come out.
I would refer everybody to the Michael Green study that we referenced ( link), which showed that a couple with 2 kids earning $140,000 a year is probably falling into poverty.
The decline in Americans' standard of living is evident with things like the average car on the roads being 13 years old now, the oldest in history.
Inflation is money printing. I'm amazed at how Boobus americanus slavishly accepts the term "quantitative easing" for the destruction of his money. Currency inflation is a scam that enriches the government at the expense of citizens. And especially enriches government cronies who get the money first.
Inflation makes for a very unstable sociological and political situation. Economic collapse usually results in political revolution. Opportunists arise, presenting harebrained collectivist solutions to the situation.
International Man: How does monetary debasement translate into politics-specifically, the rise of socialism on one side and populism on the other?
Doug Casey: People always look for political solutions to economic problems. Economic solutions are individually based; they amount to producing more and consuming less. Political solutions are collectively based; they amount to some people deciding how much wealth to take from some other people. The question is, how do political solutions manifest themselves?
Socialism is defined as a system where the State owns the means of production, but individuals can still own consumer goods such as houses, cars, and retail stores. Socialism usually devolves into a bureaucracy, with nameless NPC's* robotically pushing the buttons. Socialist ideology was spelled out by Karl Marx in the 19th century.
Populism doesn't have an ideology, however. It's just mob rule. Populist movements are generally led by a "Big Man". His main qualifications tend to be street smarts, charm, and arrogance. The Big Man is always flawed. Among other things, he's a narcissist, a liar, and a megalomaniac. But he knows how to manipulate popular discontent. What will he do ? Whatever seems like a good idea at the time.
Populist Big Man solutions inevitably involve lots of State intervention. So populism can look like socialism, or fascism/state capitalism-or whatever. Populism is an amorphous shape-shifter. The results are always more or less the same disaster. Mussolini and Peron were archetypal populists, as is a certain current leader, whose name escapes me at the moment...
Plan your life around this dictum: When times get tough, people look for the government to kiss it and make it better. They want a Big Man, with his certainty and idiotic magical solutions. Until things go bad "bigly." Then they'll turn on him.
International Man: If the asset/income divide keeps widening, where does it lead: capital controls, civil unrest, authoritarianism, outright default?
Doug Casey: All of the above. And that's exactly where we're headed in the U.S. and the West.
Let me draw your attention to Peter Diamandis interesting blog. He's a billionaire tech bro who paints a marvelous case for a happy ending to absolutely everything, paying about zero attention to the problems that you just mentioned. He only looks at technology. I'm sympathetic to that because over the last 10,000 years plagues, wars, governments, and every manner of disaster have come and gone, but tech continues advancing.
Technology is why the world has gotten better over the last 10,000 years. If that trend continues, it will result in a happy ending for humanity. But plan on some really significant bumps in the road-the kind of bumps that kill scores of millions of people and wipe out whole countries.
The Super Bulls believe everything will go right in the long run. I believe they're correct. But as Keynes said, "In the long run, we're all dead."
To answer the question briefly, tough times are coming, regardless of how good things may be over the hill and around the corner because of technology.
International Man: In the US, California is spearheading a push for wealth taxes. How do you see this trend spreading as a "solution" to this problem?
Doug Casey: Government solutions are almost always worse than the problem. Everywhere, governments are bankrupt, obviously including the US federal government. But it's also true of most state and local governments, not to mention the national governments of most countries.
Government as an institution is genetically programmed to grow. Bureaucrats move up to the next pay grade by getting more people to supervise, which requires more taxes to pay them and do all the wonderful things that government does.
At the same time, the prime directive of all living things, whether we're talking about amoebas, individuals, corporations, or governments, is: Survive. Unfortunately, since governments don't produce, the only way they can survive (barring conquering and looting a foreign country) is to tax, borrow, and inflate their currency. Since governments are programmed to grow, taxes, debt, and inflation inevitably rise.
I don't see the situation turning around. This is something that the failure of Elon Musk's DOGE demonstrated: the growth of government is essentially unstoppable. It's like a virulent cancer.
The answer that everybody comes up with is, "Well, that's why we have to vote good people into office". I've always felt this nostrum was so naive as to be stupid. With extremely rare exceptions, good people don't go into government. Those who go into government are exactly the types who are philosophically and psychologically oriented to make it worse, i.e., bigger and more powerful.
So the prognosis is not good. What will happen to the push for wealth taxes ? We'll get them.
International Man: What should the average person be doing to ensure they aren't among the poor as this trend takes off in earnest?
Doug Casey: Ayn Rand was asked, in her last public speech, "Ms. Rand, what would you do about the poor?" She answered: "Make sure you're not one of them." That's the best philosophical and practical answer to the question.
From a practical point of view, the answer is to build assets. Now. If that means cutting your consumption to a bare minimum and working two jobs, do it while the economy is still hanging together.
The big danger is politics. So if you possibly can, you should diversify politically. I understand that the average person isn't in a position to get a second citizenship or a second home abroad. But at least take the advice in the titles of two great Kurt Russell films, Escape from New York and Escape from LA.
If you do manage to diversify internationally, as you should, most Americans would naturally look to Canada. But that's probably a case of jumping out of the frying pan and into the fire. Canada is much further down the road to perdition than is the U.S.
*An NPC (Non Playable Character) is what you call minor robotic characters in a video game who don't do much other than fill space-like most people, actually.
Reprinted with permission from International Man.