(International Man)—There is only one way to rescue America’s faltering economy and that’s the wholesale abandonment of Washington’s reckless spending, borrowing and printing policies of the last quarter century. These policies did not remotely attain their ostensible goals of more growth, more jobs and more purchasing power in worker pay envelopes. What they did do, of course, was to freight down the main street economy with crushing debts, dangerous financial bubbles, chronic inflation and stagnating living standards.
For want of doubt, go straight to the most basic economic metric we have—real compensation per labor hour. The latter metric not only deletes the inflation from the pay figures, but also measures the totality of worker compensation, including benefits for health care, retirement, vacation, disability, sick leave and other fringes.
Needless to say, the purple line below makes crystal clear that historic worker gains have ground to a complete halt.
Per Annum Increase In Real Hourly Compensation:
- Q1 1947 to Q1 2001: +1.79%.
- Q1 2001 To Q1 2020: +0.71%.
- Q1 2020 to Q2 2024: -0.01%.
It doesn’t get any cleaner than this. No matter how the White House, the Fed and the fawning financial press cherry pick the “incoming data” you flat-out can’t say the US economy is “strong” when the growth of the inflation-adjusted pay envelope of 161 million workers has deflated to the vanishing point. Indeed, it has literally been dead in the water for the last 52 months running.
Real Nonfarm Worker Compensation per Hour, 1947 to 2024
Moreover, the above graph covers all workers, from the bottom to the top end of the wage scale. But when you look at the most recent trends for the highest paid jobs in the durable goods manufacturing sector, the stagnation has been even more dramatic. There has been zero net gain in real compensation per hour in this high-pay sector during the last 15 years; and an obvious contributor to that baleful outcome has been the surge of inflation since 2020 when Washington went off the deep-end with fiscal stimmies and upwards of $5 trillion of newly minted central bank credit.
And we do mean deep-end. During the one-year pandemic stimmy bacchanalia, Washington spent $6.5 trillion on a one-time basis or 150% of the regular Federal budget for war, welfare and everything else as of 2019. At the same time, the Fed printed $5 trillion of new credit during the 30 months between October 2019 and March 2022, which was more than it had printed during the first 106 years of its existence!
In any event, these reckless fiscal and monetary policies had long since caused much of the high productivity, high-pay industrial sector to be off-shored. Yet that happened not because free market capitalism has a death wish in America. It happened because Washington policies generated so much internal cost and nominal wage inflation that vendors of goods to the retail markets had no choice except to source from far lower dollar cost venues abroad, and most especially China and its associated supply chains.
Inflation-Adjusted Compensation in Durable Goods Manufacturing, 2010 to 2024
Nor is this just a manufacturing sector issue. The fact is, stagnation and shrinkage has afflicted the entire goods-producing sector of the US economy, including energy production and mining and gas and electric utility production. As shown below, during the heyday of American economic growth after WWII, these sectors were the motor force of prosperity. Between 1947 and 1978:
- Real hourly earnings (purple line) in good-producing doubled, rising by 23% per annum.
- Total hours worked (black line) increased by nearly 20%.
Since that late 1970s peak, however, no cigar with respect to either pay rates or total hours worked. In fact, by 2023–
- Real hourly pay was down by 2% versus 1979, meaning it had stagnated for 45 years!
- Total hours worked were even more debilitated, having been rolled all the way back to the late 1940s level.
That’s right. There were once 24 million high paying jobs in the good-producing sectors, which represented more than 28% of total US employment of 90 million in 1979. But by 2023, total hours worked in the goods-producing sectors have fallen to levels first achieved 75 years earlier.
Goods-Producing Sector: Index Of Real Hourly Wages Versus Index of Total Hours Worked, 1947 to 2023
In light of the above, all of the Biden-Harris palaver about a “strong” economy actually gives the concept of humbug a bad name. Like the claims of the Trump Administration before them, it is based on such egregious manipulation and cherry-picking of the data as to amount to the classic Big Lie, if there ever was one.
The fact is, neither every job counted by the BLS nor every dollar of GDP computed by the Commerce Department is created equal when it comes to economic significance. And it is exactly low pay/low productivity “jobs” and government-fueled “GDP” which has accounted for much of the ballyhooed “strength” of the US economy in recent years and decades.
For instance, at the time that good-producing employment peaked in 1979, jobs in the low-pay, minimum wage, episodic employment Leisure & Hospitality sector were just beginning to attain lift-off. During the next 45-years, hours worked in the later sector rose by +128%, even as the index for goods-producing hours per the black lines (both above and below) fell by -18%.
Needless to say, the economic weight of the purple line is only a fraction of that implicated in the black line. For instance, hours worked in the Leisure & Hospitality (L&I) sector average just 23.9 per week and average wages currently stand at $19.66 per hour. This computes to an annual pay equivalent of just $24,400 per L&I “job”.
By contrast, the equivalent figures for the goods-producing sector are 40.6 hours per week, $31.26 per hour pay rates and an annual equivalent of $66,000 in gross pay. That is to say, in terms of economic throw-weight a L&I “job” is equal to only 37% of a goods-producing “job”.
Index of Total Hours Worked: Leisure & Hospitality Sector Versus Good-Producing, 1978 to 2023
Not surprisingly, therefore, the Biden-Harris claims about 15.9 million jobs “created” on their watch should be taken with a grain of salt.
In the first place, about 9.1 million of these purported new jobs or 58% were actually “born-again jobs”. That is, jobs that were lost during the massive lay-offs triggered by UniParty lockdowns during 2020-2021 that have been subsequently recovered. Specifically, the total nonfarm job count peaked at 152.05 million jobs in February 2020 versus the 158.78 million total posted in August 2024.
So the net gain of 6.73 million jobs is a far cry from the nearly 16 million gain ballyhooed by Biden-Harris, which includes all the born-again ones.
But that’s not the half of it. When you look at the net gain of 6.73 million jobs, only 763,000 or 11% were in the good-producing sector. By contrast, 2.54 million or 38% of the net new jobs on the Biden-Harris Watch were in the low-pay or low productivity L&H, retail, government or private education and health sectors.
Indeed, these data remind that the GDP numbers reflect the same misleading distortions. Since Q1 2007, for instance, the health care sector has expanded in real terms by 57.4% compared to just 35.7% for the balance of real GDP. Likewise, since Q4 2020, the health care sector has expanded by 17.2% in real terms or nearly double the 9.8% gain for all other components of real GDP.
Then again, the health care sector is overwhelmingly a ward of the state via Medicare/Medicaid and upwards of $300 billion per year in tax subsidies for employer-sponsored health plans. So it’s a case of “if you spend it, it will grow.”
Index Of Real Health Care PCE Versus Total Real GDP, Q1 2007 to Q2 2024
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Two Storms, One Harvest
Every food crisis in living memory has been a one-shock event. The 2008 price spike was a commodity bubble. The 2020 shortages were a logistics failure. The 2022 grain scare was a war on one exporter’s ports. Each time, the system bent, adjusted, and recovered, and each time the experts assured us afterward that global markets are simply too big and too diversified to fail.
What nobody in Washington seems eager to discuss is that 2026 is shaping up to be something the modern food system has never actually faced. Two independent shocks, one climatic and one geopolitical, are converging on the same harvest cycle at the same time. Not sequentially. Simultaneously.
Start with the weather. The Pacific Ocean is currently building toward what forecasters now openly call a record event. NOAA’s Climate Prediction Center puts the odds of at least a strong El Niño near 88 percent, with roughly two in three odds it reaches “very strong” status, the tier reserved for perhaps three or four events in the entire satellite era. Every major global model now projects a median peak in Super El Niño territory, and most of them project it exceeding the 2015-16 event, which until now held the modern record. Sea surface anomalies were already brushing the super threshold in mid-July, months before these events normally peak. The atmosphere has already shifted into El Niño mode, and the event is forecast to crest in late fall and early winter.
This is not about “climate change.” It’s about the standard cycles of weather, and the cycle we’re currently in is one that has likely devastated societies in the past. We’re better prepared as a society today, but not all Americans are equally prepared.
Serious households have started doing the quiet math on their own. Grocery bills tell part of the story, and the forecast maps tell the rest, which is why long-term food storage has moved from fringe hobby to mainstream line item in the family budget, with established suppliers like Heaven’s Harvest seeing demand from people who five years ago would have rolled their eyes at the idea. That instinct is not paranoia. It is pattern recognition, and the pattern is worth walking through carefully.
Editor’s Note: Heaven’s Harvest IS a sponsor, but the warnings of this article are real and would be written even if we didn’t have a survival food sponsor. With that said, those who take advantage of what they offer can use promo code “Patriot” for 15% off.
The Fertilizer Clock Is Already Running
While the Pacific warms, the second shock has been unfolding in the Strait of Hormuz. The conflict with Iran turned the world’s most important energy chokepoint into a contested waterway, and the consequences reach far beyond the gas pump. Roughly a third of global fertilizer trade moves through Hormuz, and the disruption sent urea prices up 86 percent year over year by March, with a 53 percent jump in a single month.
The World Bank projects energy prices rising about 24 percent in 2026 and fertilizer about 31 percent. By its own accounting, fertilizer prices ran 35 percent higher in the first five months of this year than the same period last year.
Here is the mechanism the nightly news will not explain. Fertilizer is not a grocery item. It is a time-delayed input. The nitrogen a farmer in Iowa or Punjab could not afford to apply this spring does not show up as a problem this spring. It shows up as a thinner harvest six to twelve months later.
The World Bank’s own food security brief concedes that the effects of reduced applications earlier this season “are likely to become visible only later in harvest outcomes.” Translate that from institutional language into plain English and it means this. The damage is already done, it is already in the ground, and we are simply waiting for it to arrive on the shelf.
Now check the calendar. Six to twelve months from the spring planting season lands us squarely in late 2026 and early 2027. Which is precisely when the strongest El Niño in the instrumental record is forecast to peak, bringing its signature droughts to Southeast Asia, Australia, southern Africa, northern Brazil, and South Asia, the very regions that grow the world’s rice, sugar, and oilseeds.
The World Bank warns openly that a strong El Niño “could disrupt multiple crop belts simultaneously” on top of the conflict-driven input costs. Their baseline projection assumes the Middle East disruptions ease by autumn. What in the last two years of Middle East history suggests that assumption is safe?
The System Has No Slack Left
The comfortable answer is that global markets always adjust. But adjustment requires slack, and the slack is gone. Global cereal production is expected to decline from last year’s records even before El Niño does its work. The UN World Food Programme, hardly a den of right-wing preppers, is calling this the most significant disruption to its supply chains since Covid and the invasion of Ukraine, and its supply chain director put the stakes bluntly.
Today’s supply chain challenges are tomorrow’s hunger crisis.
There is also a political dimension that markets cannot price. When food gets scarce, governments do not behave like economists. They behave like politicians. Export bans, hoarding mandates, and panic buying at the national level turned the modest rice shortfall of 2008 into a global crisis, and analysts are already warning that import-dependent nations are the first dominoes.
The 2015-16 Super El Niño, a far weaker event than what is now forecast, threw tens of millions into food stress across Africa and Asia. This one is projected to be stronger, and it arrives with fertilizer already rationed by price and shipping lanes already contested by missiles.
What Joseph Knew
Scripture does not treat preparation for lean years as faithlessness. It treats it as wisdom delivered in advance to those willing to act on it.
Behold, there come seven years of great plenty throughout all the land of Egypt: And there shall arise after them seven years of famine; and all the plenty shall be forgotten in the land of Egypt.
Joseph did not respond to that warning with a hashtag or a committee. He stored grain during the years of abundance, and when the famine came, Egypt stood while its neighbors begged. The lesson is not that famine is certain. It is that the time to prepare is precisely when preparation still looks optional.
Nobody who filled a pantry in a year of plenty has ever regretted it, and nobody standing in an empty aisle has ever been glad he waited for certainty.
None of this calls for panic, and panic is the enemy of sound judgment anyway. It calls for the same unglamorous prudence our grandparents considered ordinary. Keep some cash margin, know your local growers, and put real food in deep storage while it is cheap and available, because the entire arc of this story is that cheap and available is a closing window.
Families looking for a straightforward place to start can visit Heaven’s Harvest and use promo code Patriot for 15 percent off long-term storable food. The forecasts may yet soften, the strait may yet reopen, and we should pray they do. But hope is a fine thing to hold and a foolish thing to eat.
