“That’s why they call it the American Dream, because you have to be asleep to believe it.” George Carlin. American humourist

The image the US has promoted about itself is that it is a beacon of prosperity and stability, for the rest of the world. That image only reflected reality from the late 1940s to the middle of the 1970s and was largely due to the social, economic and political reforms that were undertaken by Franklin Roosevelt during the 1930s and early 1940s. Since the mid ’70s those reforms have been systematically undermined and overturned by the US financial and political elites, in a concerted effort to return to the pre-Rooseveltian era.

Since that time, these efforts to return America to the Gilded Age have created crises across the broad range of economic, political, cultural and social spheres of American life. While the nation remains a global superpower, internal disintegration has accelerated to a point where it threatens that superpower status. Scholars and social critics such as Noam Chomsky, Richard Wolff, Michael Hudson and Chris Hedges have documented these trends, warning of probable decline, possible fragmentation and internal rebellion if these existential issues are not addressed. That raises the question of what are the indicators that this process is well underway.

The first is economic decline or the hollowing out of the productive economy. Since the last three decades of the 20th century, the US has shifted from a manufacturing-based economy to one dominated by services and finance. Neo-Liberal globalisation, with the accompanying outsourcing of manufacturing to low-wage economies like China, has decimated industrial towns, leaving millions of workers unemployed or underemployed (Wolff, Hudson). While corporate profits soared, wages stagnated, and economic insecurity spread. As a consequence, public, corporate and private debt have reached unsustainable levels. The total level of all three sectors amounts to over US$65 trillion which is well more than twice the national GDP.

The US Government budget has been in deficit continuously since 2001, while the Federal Reserve’s quantitative easing has inflated asset bubbles rather than fostering real economic growth (Hudson). Household debt, particularly in healthcare and education, has left working-class Americans in increasing poverty and having to hold at least two jobs to meet their financial obligations. Corporate mergers and acquisitions driven by hedge funds and corporate managers intent on short-term gains in share prices has stifled competition, allowing monopolies to dominate sectors like tech, healthcare, and agriculture (Chomsky, Wolff). Meanwhile, despite very substantial productivity gains, real wages have barely risen since the 1970s, while prices and costs have continued to escalate, exacerbating inequality.

Rather than investing in productive industries, the US economy, as a result of the broad adoption of neoliberal economics, has become increasingly financialised – reliant on stock buybacks, derivatives, and speculative trading (Hudson). This shift has created volatility, as seen in the 2008 financial crisis and recurring market instability.

Money in politics and corporate capture of both the Congress and the presidency is another area that has dramatically reduced the confidence of ordinary Americans in their political system. The outsized influence of corporate lobbyists and wealthy donors has corrupted democratic governance (Chomsky, Hedges). Policies increasingly favour Wall Street and multinational corporations over ordinary citizens, eroding public trust in institutions, both political and economic. Electoral systems have been manipulated through gerrymandering and restrictive voting laws, disenfranchising minority and low-income voters (Hedges). The result is a political system that no longer reflects the will of the majority. Hyper-partisanship in the Congress and in the broader society has paralysed governance, with politicians prioritising ideological battles over practical solutions (Hedges). The rise of far-right extremism and leftist disillusionment has further fractured national cohesion.

The most obvious and most commented upon reason for US decline is that it spends more on its military than the next 10 nations combined, diverting resources from vital domestic needs such as national infrastructure, health and education (Chomsky). Endless foreign interventions have required vast borrowings from the rest of the world since the Vietnam era, (The US is now by far the world’s largest debtor nation) trillions of dollars whilst failing to bring the promised international stability as those conflicts created a vast increase in terrorist activities around the planet.

A further factor leading to a fracturing of the community bonds so essential to a functioning polity is the creation of consumerism as the motivating factor in all human behaviour. American culture has become increasingly materialistic, prioritising consumption over community bonds (Hedges, Chomsky). Advertising and corporate media promote endless consumption, contributing to environmental degradation and personal alienation. The focus has been shifted from the community to the Individual. The decline of shared national narratives has led to a fractured society where identity politics often supersedes collective action (Hedges). While diversity is a strength, the lack of unifying social bonds weakens solidarity. Corporate-controlled media and underfunded education systems discourage independent thinking (Chomsky). News outlets prioritise sensationalism over investigative journalism, while standardised testing replaces critical pedagogy.

An extreme growth of wealth inequality has created a situation where the top 1% now control more wealth than the bottom 50%. This fuels resentment and instability (Wolff, Hudson). Occupy Wall Street and the recent major growth in strike activity also reflect growing discontent and division. Decades of neoliberal policies have eroded welfare, healthcare, and education systems (Wolff, Chomsky). The lack of a robust safety net leaves millions vulnerable to economic shocks. The American Dream, once a promise of upward mobility, has become a myth for most (Wolff, Hudson). The cost of education and housing locks many into generational poverty. Rates of depression, addiction, and suicide have surged, reflecting societal despair (Hedges).

The opioid epidemic and declining life expectancy underscore a public health catastrophe. The US spends more on healthcare than any other nation, yet leaves millions uninsured or underinsured (Wolff, Chomsky). Medical bankruptcies are common, and preventable deaths persist due to profit-driven care. Unlike other developed nations, US life expectancy has fallen, driven by opioid deaths, obesity, and poor healthcare access (Hedges). The COVID pandemic exposed systemic failures, privatised healthcare, underfunded public institutions, and political incompetence (Chomsky, Hedges). The US suffered one of the highest death tolls globally.

The US is a nation in disrepair as public infrastructure, once the engine of economic growth, crumbles as decades of underinvestment have left roads, bridges, and utilities in a ramshackle state (Hudson). The sell-off of public assets to private corporations has led to inefficiency and higher costs (Hudson). From water systems to toll roads, privatisation has harmed citizens who have suffered health and other problems which did not exist when the infrastructure was publicly owned. Now they are just havens for private rent-seekers. Skyrocketing rents and speculative buying have made homeownership unattainable for many (Wolff, Hedges). Homelessness surges as wages fail to keep pace with costs.

Conclusion: Is recovery possible?

The US faces interconnected crises, economic instability, political corruption, cultural decay, and social breakdown. Without systemic reforms, such as wealth redistribution, campaign finance reform, and public reinvestment, the decline may accelerate. However, history shows that societies can rebound through collective action. The question is whether America can muster the political will to change course before it is too late.