In a pamphlet from 1711, Jonathan Swift expressed his dismay over the “folly” of those who “confuse the echo of a London coffeehouse with the voice of the nation.” He noted that these informal gathering places were filled with individuals whose wealth hinged on investments in the Bank of England, the East India Company, or “other stocks.” The responses to the Trump administration’s tariff strategies are a stark reminder that, akin to many of the issues Swift criticized, the troubling tendency to equate stockholders with the nation persists.
The primary divide in American society is not between so-called red and blue states or between urban and rural residents, but rather between individuals who own stocks and those who do not. For stockholders, financial security is assessed through portfolio statements; the remaining 40 percent of Americans rely on outdated indicators such as housing costs or even egg prices.
This division extends beyond economics; it permeates ideology as well. While a significant number of Americans possess some shares, just 10 percent own 93 percent of all stocks. The elite stock-holding class has convinced itself that the prosperity of the S&P 500 directly translates to the well-being of America. Alarmingly, many individuals investing in retirement or pension plans have adopted this perspective, despite their interests rarely aligning with those of multimillionaires.
Consequently, we encounter a phenomenon of ideological capture, where any policy not aligned with shareholders’ immediate interests is branded as reckless, radical, or economically ill-informed. The common good, if acknowledged at all, is required to be articulated in terms of market returns. Is there any benefit if it doesn’t lead to an increase in stock prices? The question, we are told, answers itself.
Much like awestruck visitors to the oracle at Delphi, we turn to the Dow Jones and the S&P 500 with grave belief, interpreting their erratic fluctuations as signs of divine favor or warnings of impending doom from heavenly powers. All presidents, including Donald Trump, bow before this financial deity, and many of us implicitly view any policy that offends Wall Street as sacrilege. We regard the stock market as the ultimate judge of our collective prosperity.
However, the stock market does not equate to the overall health of the United States and frequently fails to provide a reliable reflection of economic conditions. This misconception not only obscures the reality of material circumstances but also incapacitates us from differentiating between widespread prosperity and concentrated wealth. In April 1990, the Dow Jones industrial average was at 2,710. Despite the undeniably tumultuous events of recent weeks, it now sits at 40,200. Does anyone truly believe that Americans are roughly 15 times wealthier than they were 35 years ago? Gross domestic product — another contentious measure — has only quintupled over the same period.
Consider alternative indicators. In 1970, the median household income was below $9,000. A new vehicle cost around $3,400 while the average home price was approximately $26,000. Today, median household incomes have jumped to $80,000, yet a new car sits at about $49,000 and average home values exceed $400,000.
These numbers hardly reveal the complete picture. The median income from fifty years ago typically represented a single wage earner’s income, and car prices reflected the expenses required to pay fair wages to unionized workers. Today, dual-income households are commonplace, and a considerable portion of vehicles are manufactured by nonunion labor, with many produced overseas.
These examples should also be weighed against social challenges that are not always easily quantified: the rise of gig work; the commodification of housing; the emergence of a semi-legal cannabis sector, payday lending, and online gambling; the decline in reading habits; the shrinking of attention spans as nearly all aspects of contemporary life are enveloped by digital communication technologies. Surprisingly, many of these trends have “benefited the market.”
In the post-Cold War period, Americans have become convinced that economic decision-making is free from value judgments. When market-advancing policies are implemented, we tend to believe they conform to an unassailable natural law. However, elevating shareholder value is merely one objective; another could be boosting domestic steel production, or encouraging skill development within the lower middle class. These are all political decisions, just as much as whether to regulate or privatize.
A flourishing stock market does not equate to genuine prosperity when real wages remain stagnant, housing becomes unattainable, and infrastructure deteriorates. Hence, we should approach with skepticism the usual voices — financial analysts, think tank members, and chronic critics of Mr. Trump — as they express concern over supposed harm to “the economy.” What, precisely, are they lamenting?
There are numerous valid criticisms of Mr. Trump’s erratic tariff policies. However, mere spasms of economic activity directed toward Wall Street cannot be considered a genuine concern. If nothing positive emerges from this tumult, a call for a comprehensive national objective that transcends the simplistic aim of “making the number go up” would represent a meaningful step towards improvement.
When John F. Kennedy proclaimed that “a rising tide lifts all boats,” it’s likely he did not foresee some yachts sailing off into the distance while a fleet of rowboats capsized. That tide has indeed risen.
