The U.S. is following a classic late-stage empire playbook by financializing its economy while outsourcing manufacturing. This practice creates an illusion of prosperity through cheaper goods and labor, but it masks the underlying decay of the domestic economy and middle class.

Just as 1990s free trade brought cheap goods by outsourcing manufacturing, AI will bring cheap digital services by outsourcing cognitive labor to a "new country of geniuses in a data center." This analogy suggests the result will be concentrated wealth and broad job displacement.

Wage stagnation is not accidental but a result of two concurrent policies. By sending manufacturing jobs overseas and simultaneously bringing in low-wage labor, corporations create a market where domestic workers lose nearly all leverage to demand higher pay for remaining jobs.

The celebrated economic growth of the 2000s, driven by asset-light companies like Google and Meta, had a hidden cost: the US dismantled and offshored its critical physical infrastructure. This 'capital-light mentality' created massive supply chain fragility, now exposed by geopolitical conflicts and driving inflation.

Moving away from globalization to fix the K-shaped economy is a direct trade-off. While consumers will pay more for goods, the nation gains supply chain control and empowers the domestic workforce, which can rebuild the middle class. There is no utopian solution.

By shipping millions of jobs overseas, globalism forced American workers to compete with a much larger, cheaper international labor pool. This eliminated employers' need to compete for a finite domestic workforce, leading to wage stagnation. The proposed solution is to bring manufacturing jobs back to the U.S.

The growing gap between company productivity and employee wages isn't solely due to corporate greed. The ability to outsource work globally gives companies immense leverage, weakening the negotiating power of domestic workers and suppressing their wages.

The argument that developed nations can thrive by outsourcing manufacturing and focusing on services is a fallacy. True value is added in manufacturing. The only service sector that truly expanded was finance, which primarily fuels unproductive asset speculation, leading to inevitable booms and busts.

Globalism was highly successful, lifting millions from poverty. Its failure wasn't the concept itself, but the lack of strategic boundaries. By allowing critical supply chains (like microchips and steel) to move offshore for cost savings, nations sacrificed sovereignty and created vulnerabilities that are now causing a predictable backlash.