The French Revolution Didn't Help The Poor — It Killed Them. America Is About To Learn That The Hard Way | Tom's Deepdives

Welcome to Impact Theory with Tom Bilyeu. In today's episode, we dive deep into the economic forces pushing America toward a critical inflection point—one that mirrors the conditions before every major social upheaval in history. Speaker A explores how escalating inequality and unaffordability, paired with runaway deficit spending and inflation, are squeezing the middle class and threatening the fabric of society. Drawing lessons from past crises, revolutions, and uprisings, Speaker A argues that reform is not only necessary but urgent—and that real change comes not from violence or blaming the wealthy, but from understanding economic mechanisms and demanding responsible policy. Get ready for a high-stakes analysis that blends history, economics, and actionable strategies—because in times of turmoil, understanding the real levers of power can make all the difference. 00:00 - Intro 02:02 - Part 1: The Two-Sided Squeeze 07:56 - Part 2: Let the Games Begin 15:31 - Part 3: Balance the Budget or There Will Be Blood 25:27 - Part 4: Moving Forward Well Regardless of Lunatic Politicians What's up, everybody? It's Tom Bilyeu here: If you want my help... STARTING a business:join me here at ZERO TO FOUNDER https://tombilyeu.com/zero-to-founder?utm_campaign=Podcast%20Offer&utm_source=podca[%E2%80%A6]d%20end%20of%20show&utm_content=podcast%20ad%20end%20of%20show: https://tombilyeu.com/zero-to-founder?utm_campaign=Podcast%20Offer&utm_source=podca[%E2%80%A6]d%20end%20of%20show&utm_content=podcast%20ad%20end%20of%20show https://tombilyeu.com/zero-to-founder?utm_campaign=Podcast%20Offer&utm_source=podca[%E2%80%A6]d%20end%20of%20show&utm_content=podcast%20ad%20end%20of%20show SCALING a business:see if you qualify here. https://tombilyeu.com/call: https://tombilyeu.com/call Get my battle-tested strategies and insights delivered weekly to your inbox:sign up here. https://tombilyeu.com/: https://tombilyeu.com/ ********************************************************************** If you're serious about leveling up your life, I urge you to check out my new podcast,Tom Bilyeu’s Mindset Playbook https://open.spotify.com/show/47VE90Cittmo6TGGFqg2xf —a goldmine of my most impactful episodes on mindset, business, and health. Trust me, your future self will thank you. ********************************************************************** FOLLOW TOM: Instagram:https://www.instagram.com/tombilyeu/ Tik Tok:https://www.tiktok.com/@tombilyeu?lang=en Twitter:https://twitter.com/tombilyeu YouTube:https://www.youtube.com/@TomBilyeu Blinkist: Start your free trial at https://blinkist.com/impactQuince: Free shipping and 365-day returns at https://quince.com/impactpodShopify: Sign up for your one-dollar-per-month trial period at https://shopify.com/impactKetone IQ: Visit https://ketone.com/IMPACT for 30% OFF your subscription orderQuo: Try for free PLUS get 20% off your first 6 months at https://quo.com/impactAT&T Business: Switch to AT&T Business at business.att.com http://business.att.comNetsuite: Right now, get our free business guide, Demystifying AI, at https://NetSuite.com/Theory https://netsuite.com/TheoryMonetary Metals: Future-proof your wealth at https://monetarymetals.com/impactIncogni: Take your personal data back with Incogni! Use code IMPACT at the link below and get 60% off an annual plan: https://incogni.com/impact Learn more about your ad choices. Visit megaphone.fm/adchoices https://megaphone.fm/adchoices See Privacy Policy at https://art19.com/privacy and California Privacy Notice at https://art19.com/privacy#do-not-sell-my-info.

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:00Tom Bilyeu?

  Let's talk about the moment your side hustle becomes a real business. Now, I see way too many founders stay stuck running their business like it's a hobby, and then they wonder why nothing ever feels real. It doesn't feel real because it's not. I've helped thousands of entrepreneurs build real businesses through Impact Theory University, and the first step in the path to building a legit business is registering it. And Taylor Brands will help you do just that in a few clicks. An LLC, a limited liability company, is an official business structure. It's inexpensive to form and very simple to maintain. It's how you open a business bank account. It's how customers know they're dealing with a real company. And Taylor Brands doesn't stop at the filing.

• 0:45Tom Bilyeu?

  Their dashboard tracks what comes next based on what your business actually needs. So EIN number, registered agent, licenses and permits, bookkeeping, business banking. I tell every founder the same thing. Just make it official. Click the link in the show notes to check out Taylor Brands and get started on your business today. This is a paid advertisement. Right now, the United States is at the same kind of instructural inflection point that has preceded every major social eruption in recorded history. All you had to do was pay us enough to [bleep] live. There goes your inventory. It was a six-alarm fire that burned the place to the ground.

• 1:26Tom Bilyeu?

  He uploaded the video to Instagram himself because he knew that the public was going to be on his side. His name is Kamal Abdul Karim, a 29-year-old making roughly $37,000 a year. The problem? An average one-bedroom near the facility in Ontario, California runs over $2,000 a month. To him, the injustice of the situation was obvious. The rich abuse the masses, and the masses suffer as they must. Therefore, his act to him, despite being arson, was actually a service of justice. Now, how do I know that he and a growing number of people believe that this act of vigilanteism was actually justice? Because on his very first phone call while

• 2:10Tom Bilyeu?

  in custody, he compared himself to Luigi Mangione. Mangione is the all-too-popular murderer who shot and killed a health insurance CEO in cold blood on a Manhattan sidewalk back in December of 24. A murder so shockingly well-received by the public that his legal defense fund has already raised nearly a million dollars from roughly 30,000 donors. Approximately 50% of American college students sympathize more with Mangione than the man that he killed. Inequality has already surpassed intolerable, and now instability in the Middle East threatens to become the straw that breaks the camel's back, and I'm gonna prove it. There are just two paths before us.

• 2:55Tom Bilyeu?

  If you want to avoid calamity, it is imperative we take the right one. I'll explain why in four parts. Part three is what the vigilantes do not understand, so regardless of what you think now, do not skip that part. Welcome to Part One: The Two-Sided Squeeze. Since 1979, worker productivity in the United States has grown by 80.9%, but wages have only grown by 29.4%. The last time America's wealth concentration was this out of whack was the Gilded Age. You know, the era of the robber barons? And I mean that comparison literally. You can actually measure inequality. You use something called the Gini coefficient.

• 3:37Tom Bilyeu?

  It peaked in 1890 during the Gilded Age with a Gini coefficient of 0.87. It was a catastrophe that almost destroyed America. Now guess what today's Gini coefficient is? 0.86. We're only .01 behind our all-time war score. In the Gilded Age, the richest 4,000 families in this country held as much wealth as the other 11.6 million households combined. Today, the top 1% hold as much wealth as the bottom 90% combined. Same stupid, socially suicidal picture, but 130 years later. This isn't just kind of uncomfortable, it's genuinely destabilizing.

• 4:20Tom Bilyeu?

  And given all of the local and global upheaval that we're all living through right now, I really hope I don't have to spend time convincing you that things right now are extremely unstable. This is what happens. Inequality starts building up. Right now in America, 10% of Americans own 93% of all stocks and financial assets. But that by itself does not cause people to burn warehouses and shoot CEOs. For that, you need a second ingredient: inflation. Why? Because inflation is what created the unaffordability crisis. Right now, people are convinced that billionaires are stealing money. But the reality is, this is a politician and central banking problem,

• 5:01Tom Bilyeu?

  where we run these insane deficits and then we money print to cover the problem. And that is what drives a K-shaped economy, and that is what creates the billionaire class. And guess which political party is driving the unaffordability crisis? That's right, both of them. Until state and federal budgets are balanced, you are being stolen from by your elected officials. It's not the wealthy stealing from you. It is the politicians in charge of the budget. An unbalanced budget forces the government to money print. And when the government prints money, and it has been printing historic amounts of money for over a decade, the price of everything goes up, way up.

• 5:43Tom Bilyeu?

  And when that happens, your purchasing power goes down, way down. And the only protection from that absolutely despicable, immoral, secret tax is to own assets. That relationship is what creates billionaires. Assets are things whose value rises as more money is printed: stocks, real estate, business ownership, etc. Assets are the only escape from inflation. The bad news: 90% of Americans barely have any at all. It's like being inside of an X-ray machine with no lead vest. In the moment you don't realize, a terrible thing is happening to you. But in reality, that thing is doing massive damage. You just can't see it.

• 6:28Tom Bilyeu?

  But it's the very reason you can't afford your rent. And all of the rent control in the world is not going to help. But that's a story for another deep dive. In fact, it's right here. Now get this. For six consecutive years through 2025, the bottom 80% of American consumers failed to keep up with inflation. It's been six straight years of falling behind on the kinds of things you can't cut. Housing, grocery, energy, healthcare. These are necessities, and they're getting even more expensive faster than before. So when you've got a full-time worker making $18 an hour and taking home roughly $37,000 a year, but

• 7:09Tom Bilyeu?

  a one-bedroom apartment in his neighborhood runs over $2,000 a month, you're spending 65% of your take-home pay just on rent. That's before food, before gas, before saving any money, before being able to buy the assets that would protect you from the inflation. When the necessities are unaffordable and people's Instagram reels are full of rich people flying around on jets, shit gets burned and uploaded to Instagram. History shows us over and over that what breaks a society is when inequality and unaffordability happen at the same time like they are now. People get squeezed from both sides and they start looking for a way out, even if that way is ineffective and violent. Now

• 7:53Tom Bilyeu?

  there's a famous experiment in behavioral economics. Researchers give one person $100 and tell them to split it with a stranger. The stranger can accept or reject the offer. If they reject it, though, nobody gets anything. By pure logic, the stranger should accept any amount of money above zero. Something is always better than nothing, but they don't accept it. Consistently, across cultures, people will choose nothing over watching someone else take a disproportionate share. But what happens when the cause of that disproportionate share is misunderstood? For an individual, rejecting the offer and getting nothing is completely irrational. But the instinct evolved because groups that tolerate unfairness

• 8:36Tom Bilyeu?

  stop cooperating and fall apart. What breaks a society is the compressed middle, the people with just enough time and money to see the Justice and do something about it. And ultimately, it's not the baseline suffering that causes people to snap on mass anyway. It's having inequality, meet unaffordability, and then be hit with a fresh shock when people have completely run out of cushion. The bad news for us is that shock is coming right now. Welcome to part two, Let the Games Begin. The world has a wild history of economies getting out of whack and then getting slapped back into place. In 1786, American farmers who had just fought the Revolutionary War for liberty

• 9:19Tom Bilyeu?

  were facing an unaffordability crisis. Many were losing their farms to debt collectors. Daniel Shays led an armed revolt. In 1892, Andrew Carnegie announced an 18% pay cut at his most profitable steel plant. A gunfight ensued and 12 people were killed. In October of 2019, Chile raised the price of a subway ticket by four cents. It was the straw that broke the camel's back and 1.2 million people took to the streets. Thirty people died, billions in property damage was done. These kinds of unaffordability revolts happen constantly throughout history all over the world. They are mechanistic as well as emotional.

• 10:02Tom Bilyeu?

  When people can't make ends meet, someone will eventually meet their end. Now let's zoom in on the Shays Rebellion. By 1786, roughly three years after the farmers and tradespeople who fought in the Revolutionary War returned home, they were losing everything, not to a foreign enemy, to debt collectors. Massachusetts had slapped heavy taxes on its citizens to pay off its own war debts. Sound familiar? Money was scarce, credit was impossible, courts were seizing farms and throwing men in debtors' prison for falling behind. These weren't hooligans causing trouble. These were the men who had fought and bled for the principle that no government gets to crush the people who built the country. So Daniel Shays led his infamous armed revolt.

• 10:47Tom Bilyeu?

  Ultimately, it was put down, but it terrified the founders. Madison wrote about it obsessively. Hamilton cited it by name. Both of them pointed to Shay's Rebellion as proof that the first framework for the American government, the Federalist Papers, wasn't strong enough to handle the reality of economic despair. It couldn't stop the rage. It couldn't channel it anywhere productive. The revolt was a direct catalyst for the Constitutional Convention of 1787, the very thing that gave birth to our Constitution, which, believe it or not, most people don't know this, it didn't get written and ratified until 12 years after the Declaration of Independence was signed. The Constitution was literally, partly, America's structural answer

• 11:32Tom Bilyeu?

  to what happens when the economy breaks. A deeper look at what happened in Chile proves that this is not a thing of the past, nor something unique to America. This is an artifact of the human mind and the societies that we create. Chile wasn't a failing state. In fact, it was one of the most economically successful countries in Latin America. The protesters who took to the streets due to a 30 peso price increase, again, it's about 4 cents in US dollars, had a phrase that said everything. No son 30 pesos, son 30 años. It's not 30 pesos, it's 30 years. Meaning, this most recent raise is just the straw that broke the camel's back. The middle class had been getting squeezed for decades,

• 12:16Tom Bilyeu?

  and people will only put up with so much. The 4 cents was just the moment that the last bit of margin disappeared and people simply weren't going to put up with it anymore. Now, the important thing for all of us in this moment is to understand that the baseline inequality is now colliding with a baseline unaffordability crisis. And the trap is set. It's going to snap closed when a fresh shock hits this already-taught system. Now with that in mind, look at where we are right now. The bottom 80% of American earners have been getting hammered by inflation for years. The ends officially no longer meet. Personal debt is drowning most people, and they see no way out. And right at that moment, the United States and Israel launched Operation Epic Fury against Iran.

• 13:01Tom Bilyeu?

  Iran responded by closing the Strait of Hormuz, the narrow waterway, which sees roughly 20% of the world's oil supply pass through it. Oil ended up going from $70 a barrel to over $120 at one point. It's all over the map, all the time. Gas went from under $3 a gallon to over $4 nationally, over $5 here in California. The IMF has a specific formula for oil-created inflation. Every 10% rise in oil prices produces a 0.4% rise in inflation. Oil is up more than 70% since the war began. That's 2.4% inflation. Now, in fairness, the price has gone up and come back down, gone up and come back down again.

• 13:45Tom Bilyeu?

  So who knows where it will be by the time you hear this? But know this: if inflation doesn't come back down and stay down, there's likely to be a real problem. The US is already in the grips of an unaffordability crisis, and we will not be able to tolerate an increase in prices via inflation. Whether it comes from oil or good old-fashioned money printing to cover deficit spending, this will become our version of Chili's 4 cents. Different country, but it's the same mechanism.

• 14:15Tom Bilyeu?

  Stick around, we'll be right back after this. There's a reason Quince sells cashmere for $60, and it isn't the cashmere. It's real 100% Mongolian cashmere. It's the same stuff luxury labels charge a fortune for. Quince just works directly with ethical factories and cuts out the middleman. So there's no need for a markup and no logo tax. The $60 goes to the actual sweater, not the fancy name on the tag. That's why everything they make runs 50% to 80% less. And it's not just the cashmere. I ordered a few things myself: their fleece joggers, a couple of their tees, which I wear obsessively. First thing I noticed was the quality: soft, well-made, built to hold up.

• 14:59Tom Bilyeu?

  They make down jackets and wool outerwear now, too. So upgrade your stuff to things you'll actually wear. Find your next fall favorites at Quince. Download the Quince app for app-exclusive offers, or go to quince.com. Get free shipping on your order and 365-day returns, now available in Canada and the UK, too. And when Quince asks where you heard about them, let them know it was Impact Theory. It's the best way to support the show. Let's talk about something that genuinely keeps me awake at night. My team at Impact Theory gets hit with phishing scams from bad actors pretending to be me all the time, and they keep getting more sophisticated attacks with details specific enough to look legit.

• 15:43Tom Bilyeu?

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• 16:28Tom Bilyeu?

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• 16:41Tom Bilyeu?

  All right, let's pick up where we left off. So, welcome to Part Three: Balance the Budget, or There Will Be Blood. Every major period of sustained economic inequality in recorded history has ended one of two ways: structural reform or mass violence. History says that there's no third option: the Gilded Age, pre-revolutionary France, Romanov Russia, Weimar Germany. Every time you combine extreme inequality with an unaffordability crisis long enough, one of those two things happens: the structure gets fixed, or the structure gets destroyed. This is why the Democrats will rightly run on a platform of affordability during the midterms. But watch the policies they put forward.

• 17:23Tom Bilyeu?

  If they aren't about balancing the budget, it will all be for naught. Same with the Republicans. Independent voters will swing from one side to the other and back again, hoping one of them is finally going to fix it. But you can't fix it with words. The budget must be balanced. The great news is, the way out of our problems is relatively simple. But if it doesn't begin with a balanced budget, you can know every word out of their mouths after that is completely illogical and is not going to save you. Even the historical violence didn't solve the problem. And that's one of the most important things I want to get across today. I understand why someone wants to burn a warehouse. I understand why people feel violently towards those that they think are holding them back.

• 18:06Tom Bilyeu?

  But the reality of how violence impacts the actual change is that it simply makes things so painful that everyone will finally be willing to accept austerity and balance the budget. But there's no way around needing to balance the budget. And here's the part that people cheering on Kamal Abdul Karim and Luigi Mangione have to contend with. When the structure gets destroyed, when mass violence is the path that people choose, the people who suffer the most are never the people at the top, at least not the bulk of them. They have lawyers, security, insurance, continuity plans, and extreme mobility. You'll catch a few of them, but overall, they're going to be fine. Kimberly Clark's supply chain was already routing around the fire

• 18:48Tom Bilyeu?

  as it was still burning, and ultimately, they didn't miss a beat. The people who will suffer from that fire are the people who were already struggling to make ends meet, namely, the 20 coworkers of Abdul Karim, who lost their job when he burned the place down. It had nothing to do with the wage structure, the inflation rate, or the balance sheet of NFI Industries that owned the warehouse. They were just working a night shift, trying to put food on the table. The fire does not help them at all. Only a balanced federal budget and a strong economy will help. Now, let me show you something about how the anger-as-solution path actually works. Take one of the most famous examples of a violent uprising bringing about change: the French Revolution.

• 19:32Tom Bilyeu?

  The whole idea of "let them eat cake", it was so out of touch. Kill the morons and let peace reign, right? That's how people think about it. But Marie Antoinette never actually said the line that supposedly justified killing her and the other aristocrats. The whole "let them eat cake" thing was written by Jean-Jacques Rousseau in 1765, when Marie Antoinette was only nine years old, living in Austria and had never even been to France. Rousseau attributed the line to someone else that he called a "great princess". It wasn't her. Not one newspaper from the actual French Revolution ever cited that quote. The people who guillotined her never used it as evidence against her. It wasn't attached to her name in print until 1843, 50 years after her execution, as people were trying to whitewash

• 20:17Tom Bilyeu?

  and sanitize what had actually happened. And we all risk losing the actual lesson of the catastrophe of the French Revolution. The French Revolution did not produce equality. It produced the reign of terror. 17,000 executions. The majority of them not aristocrats, but instead, the middle class. Lawyers, merchants, journalists, farmers, and eventually, the very revolutionaries themselves. Robespierre, the man who built the guillotine murder machine, was himself fed into it. And into all of that chaos stepped Napoleon. Not somebody who ushered inequality. Instead, it was somebody who took all of that revolutionary energy

• 21:02Tom Bilyeu?

  and pointed it outward and created 20 years of war all across Europe. Three to six million people dead. The working-class men who had stormed the Bastille, dreaming of bread and dignity, ended up dying in Russian snowfields. Again, the rage is justified. It was justified then, it's justified now. Reform was necessary then, reform is necessary now. But we've got to get the policy right. Because when policy is dictated by bloodlust and raw emotion, rather than the physics of money, the outcome is guaranteed to be terrible. And there's a knowable reason why. Because it doesn't address the underlying economic... Policy decisions that caused the problem in the first place.

• 21:46Tom Bilyeu?

  And that brings me to a brutal truth. This moment in history is going to be more difficult to unwind than the Gilded Age. To turn the ship around during the Gilded Age, Teddy Roosevelt, one of the four people on Mount Rushmore, what he focused on was breaking the monopolies. Always a good idea. Labor laws got passed. Absolutely fantastic. Progressive taxation came in. Wonderful. That was sufficient to change the underlying math. And it gave birth to the longest sustained run of middle-class wealth growth in American history. But the Gilded Age reformers didn't have to crawl out from under crushing debt and the devastating effects of money printing. When Teddy Roosevelt went after Standard Oil and US Steel,

• 22:29Tom Bilyeu?

  the government wasn't already running a $2 trillion annual deficit. Wages weren't being eroded every year by the money printing that those deficits that we now have require. The structural reforms they put in place had room to work because the fiscal foundation wasn't actively rotting beneath their feet. But our foundation is rotten. Right now, the inequality that we're suffering from is being driven by deficit spending and money printing, not monopolies and under taxation of the wealthy. I know that is a very popular mantra. The US already spends the same amount per citizen

• 23:11Tom Bilyeu?

  as Sweden, France, Germany, and the Netherlands. And we massively outspend places like Canada and the UK. And the countries that spend more than us while still sticking to something closer to a balanced budget do so by taxing everyone. And they do it through taxes like VAT. Now, a lot of people don't understand what VAT is. But a VAT is a value-added tax, meaning it's a consumption tax. Everybody's going to pay it if they buy something. So the poorest of the poor are going to be paying that tax when they buy. And this is why people say consumption taxes hurt the poorest the most.

• 23:50Tom Bilyeu?

  So if you're a Trump fan and you support massively expanding tariffs and other consumption taxes, then you can at least partially tax your way out of this hole. That would... alleviate a small part of the burden if you didn't increase your spending, but you will still usher in austerity. You'll just do it via tax instead of spending cuts and taxes on the people who can least afford the taxes. Given the level of fiscal mismanagement and fraud, you will have all of the pain and only a very small fraction of the gain if you try to do this via income tax. That's why increased taxation is not the sensible solution to this problem. You'll have to tax the very people you're trying to help.

• 24:33Tom Bilyeu?

  The only way to capture an additional $2 trillion via tax without destroying the economy is to somehow, some way usher in an absolutely unprecedented amount of economic growth. But given that our GDP right now is currently growing at a slower than expected rate, I would absolutely not count on that. The reality is, without dramatic change to how we think about government spending, inflation will keep destroying the middle class. As long as we run grotesque deficits, everything is a Band-Aid on a severed artery. The government is currently collecting a staggering $5 trillion in tax.

• 25:12Tom Bilyeu?

  That's about twice what China collects, and they have four times the population. The US does not have a tax revenue problem. America has a spending problem. Despite our insane $5 trillion tax raise, we come up $2 trillion short because of our ridiculous $7 trillion a year budget. And that gap has to be funded somehow, and the way it gets funded is by using inflation to steal from everyone who holds dollars. Again, it hurts the working and middle class the most. And that means the reform this moment demands is harder than what the Gilded Age required.

• 25:51Tom Bilyeu?

  You have to fix the inequality precisely by fixing the mechanism that keeps making affordability worse. If you don't do that, nothing will solve the affordability crisis. You could tax the wealthy at 100%, and even if in some magical fairyland where that actually increased your tax revenue, spoiler In the real world, it never does. Look up the Laffer curve. But even if it did, you would still only buy yourself an extra handful of years before you were right back in this position. But you would be much, much worse off because you would have decimated the economy by destroying the only machine that has ever created prosperity, namely the free markets.

• 26:34Tom Bilyeu?

  And you have to somehow get people to vote for austerity at the exact moment that they're angry enough to burn buildings. So, welcome to part four, moving forward well regardless of lunatic politicians. The last time America grew its way out of a debt crisis of this magnitude was right after World War II. Americans were happy, optimistic, and they were helping much of the world rebuild. GDP grew at over 4% annually for nearly three decades. We're currently growing at roughly 0.5%. And for everyone marching in the streets and campaigning on more tax, you have to contend with this reality. For every dollar of new tax revenue collected since 2019,

• 27:19Tom Bilyeu?

  the federal government has added a dollar fifty-eight in new spending. You can't fill a bathtub with the drain open. Every country except Japan that has spent any meaningful time above 130% debt to GDP has ended in internal conflict, revolution, or outright economic collapse. The United States is currently at roughly 123% and climbing. For those reasons and more, right now, America is on a one-way collision course with mass violence. Now, let's talk about the solution and what's standing in the way of it. Then I'll map out how I'm thinking about positioning myself in case the political machine continues its insane dysfunction. Remember Shay's Rebellion? Farmers who fought for liberty because they were losing their farms to debt collectors?

• 28:04Tom Bilyeu?

  The founders looked at that rage and didn't just dismiss it. They asked what structural failure produced it and built the United States Constitution as an answer. Remember Homestead? Workers who bled for wages that couldn't cover their bills? The violence didn't fix the math. It was a generation that looked at the carnage and demanded specific structural reform. Anti-trust law, labor protections, progressive taxation, until the math actually changed. Both times, the people who solved the problem understood one thing the angry people didn't. The target isn't a group of people, the target is the mechanism. The way that the economy actually works, what specific part of the economy is broken? And then address that, and it's going to be different every time.

• 28:48Tom Bilyeu?

  If we try to run the anti-monopoly playbook when monopolies aren't our problem, or we try to tax people more when we're already nearing the top of the Laffer curve, it's not going to work. The politicians and central bankers didn't wave a magic wand and break the economy. They enacted specific policies that had negative consequences. We have to fix those policies and change the mechanism if we want to solve the problem. Taxing billionaires more doesn't actually generate more revenue, at least not enough to deal with the problems that we have. And even if it did, it wouldn't solve the problem of a chronically unbalanced budget. The only thing that actually stops the middle-class destruction machine is a balanced budget and a deglobalized world. Could do a whole deep dive on that.

• 29:30Tom Bilyeu?

  Now, I know that sounds like fantasy right now, and honestly, politically, it probably is. No one's going to get elected on austerity right now, certainly not during a populist moment like this one. But crazier things have happened, and I think we all have to try and make sure that this message gets heard. So as a quick aside from our economics, ask every candidate in the midterms one question regardless of party. What are you going to stop spending money on so we can balance the budget? Okay, let's talk about the go-forward plan. First, we need to understand how Trump's radical and so far reckless restructuring of the world order is likely to play out. Trump's stated plan was growth. Tariffs to bring manufacturing home, deregulation to unleash the private sector,

• 30:13Tom Bilyeu?

  onshoring critical industries to bring investments and jobs. The theory being that if you can generate enough economic growth, you can outrun the debt math. It's not a crazy idea on paper. The problem is the scale of what's required now. The debt is soul-crushing. The annual deficit is staggering, the growth rate needed is historically unprecedented and our current trajectory is terrible. We have slower than expected GDP growth, layoffs up dramatically over 2025, and a wildly K-shaped consumer economy running on a shrinking cohort of wealthy spenders. None of that supports the bet that we're going to grow our way out of this. So as I think through how to invest, how to position myself,

• 30:57Tom Bilyeu?

  I know that I've got to think through the global chaos that we are going through right now. Because of what's happening in Iran, we are in an incredibly precarious situation. So I am trying to build a mental map of what Trump is doing, what will happen whether he succeeds or fails, and from that, I'll be able to think my way through the problem. Now, I think Trump's original plan went something like this. Accept a multipolar world, but do everything we can to stop China from taking the number one spot and replacing the dollar as the world's reserve currency. Exit the world stage and focus on building up the Greater North America. Kick China out of our hemisphere and control as much oil as he can.

• 31:39Tom Bilyeu?

  Shore up the Petro-dollar and control more oil by targeting Iran. Strengthen the US economy by betting big on AI and crypto. AI is the ultimate military weapon and the ultimate prosperity generator. And whoever wins AI is going to win everything. And crypto solidifies the US dollar's dominance by creating massive global appetite for our debt. Think he was also thinking secure foreign investments in the US AI infrastructure via the GCC nations as they have become the global home for capital. But as Mike Tyson says, everybody has a plan until they get punched in the face. But even if we face plant in Iran, like it looks like we're going to, there's plenty of lemonade to be made from those lemons.

• 32:23Tom Bilyeu?

  If oil becomes more expensive because it has to travel through contested waters, people can start buying oil directly from the US. We start to look like a rogue nation, there's no doubt about that, but it will still boost the US economy. America is the world's largest oil producer. When 20% of global oil supply gets strangled in a choke point that we don't depend on, we will potentially capture some market share from every competitor who does depend on it. Now, I don't think that was Trump's plan when he started. This was not some brilliant 4D chess move. And honestly, I think he's going to keep fighting in the Middle East long past when he should have ejected out. But even if he does, there's money to be made in both victory and failure.

• 33:06Tom Bilyeu?

  The question is, will it be enough to get us out of our debt? And I think the answer is no. Not unless we balance the budget. AI is the only thing that might just be enough, but that still feels a little too fairy tale to count on. The growth required to actually outrun this debt math is so historically unusual that I would not bet my financial future on it happening. Which means you need a plan that works whether it succeeds or fails. Here's how I'm thinking my way through it. First, I have to understand what inflation actually is and stop trying to fight it politically before I protected myself from it financially, and I highly encourage you to do the same. Second, own assets, always and forever. In an inflationary environment, you have to have assets.

• 33:50Tom Bilyeu?

  And in the current geopolitical setup, assets don't just protect you from inflation, they allow you to benefit from the GCC funneling their sovereign wealth into American AI infrastructure. But do keep your eyes peeled that if things go poorly for the GCC nations in the Iran conflict and they're forced to pull their investment dollars back, that should influence the way that you're thinking about investing. Third, watch the cost of energy. If oil stays elevated, the roughly 2.4% additional inflation is likely to bring with it an acceleration of anger in the populace. Fourth, make sure you're emotionally immune from the narrative manipulation that will

• 34:31Tom Bilyeu?

  be used to rile up both sides of the political aisle as we approach the midterms. And make sure you watch how those narratives are affecting others. And fifth, keep some cash on hand so that your options are open. The only guarantee I can make is that the future is going to be surprising. Also, markets tend to follow the path of maximum pain. The things people already understand are already priced in. The surefire bets that make the headlines will get priced in almost instantly. The vulnerabilities almost always come from some unexpected oblique angle. The people who came out ahead after the Gilded Age weren't the ones who predicted the crash specifically. They were the ones who understood the structural direction of the economy,

• 35:14Tom Bilyeu?

  positioned accordingly, and held through the inevitable volatility that came with a system under that much pressure. The system that we're in is under enormous pressure. That is going to create opportunity and calamity in equal measure, so be paranoid. Do not assume you're on the right side of any one equation. Brace yourself for unrest, but don't crawl into a bunker. Let me leave you with this. Kamal Abdul Karim, the guy that burned down the toilet paper distribution center, he was right about one thing. People have to make enough money to live, and if they don't, they will burn down the system. He was right that the math doesn't work for millions of Americans. He was right that the people at the top of this economy have accumulated an obscene amount of wealth,

• 35:58Tom Bilyeu?

  while the people at the bottom have been systematically stripped of any cushion whatsoever. What he gets wrong is massive, and it's the mechanism by which all of this is happening. The insurance executive and the warehouse owner, they're not the machine, they're inside the machine. The machine is a $2 trillion annual deficit that turns the gap between what you earn and what you owe into somebody else's asset appreciation. You don't fix that with a lighter, though. You can't burn or kill your way to a solution. You fix it by making it politically impossible for any candidate from any party to get elected without a credible plan to balance the budget. That's a harder ask than burning a building, I get it. It requires economic literacy instead of the raw emotion that is so easy to come by, especially right now.

• 36:43Tom Bilyeu?

  And it requires us all to hold the line on the standard that we will expect candidates to balance the budget. But it's also the only ask that has ever actually worked. That's what this moment demands. Economies have physics that can't be ignored. That doesn't mean people shouldn't be angry. Right now, they should be. But it does mean that if they don't aim their anger at the actual source of the problem, the rage will only bring more suffering, not less. The people who understand the physics of this moment have an enormous advantage over the people who don't. Once you understand it, you can at least use it to protect you and your loved ones. With enough will and focus, anything is possible. These problems are hard, but they certainly aren't new. Every generation that has faced the collision of inequality and unaffordability

• 37:27Tom Bilyeu?

  has had a choice between the rational path and the emotional one. Most choose emotion, but we certainly don't have to. We can solve this problem. All right, that's it for today's episode. If you got value out of this, it would mean the world to me if you would go give us a five-star rating. It helps more than you know. All right, thank you, and until next time, my friends, be legendary. Take care. Peace. Let's talk about a pattern that is guaranteed to be killing your progress. You know what you need to do. You need consistent nutrition. We all do. You need vitamins, probiotics, greens. We all know that we should be doing more of it. When your morning gets chaotic, you skip it. When you travel, you skip it. When your routine breaks, everything tends to break, and that inconsistency compounds against you every single day.

• 38:12Tom Bilyeu?

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