The Broken Promise: How Economic Despair, Culture Wars, and AI Are Undermining American Democracy

In the early 1990s, as the Berlin Wall lay in rubble and the Soviet Union dissolved, a giddy certainty gripped the American ruling class. History, it seemed, had ended. Liberal democracy and free-market capitalism had triumphed, not just as the best system but as the final system. Francis Fukuyama’s The End of History and the Last Man gave this moment its name—a triumphalism that threaded through think tanks, op-eds, and the global institutions that shaped the post–Cold War order.

But history, it turns out, had not ended. It was merely regrouping.

From Reagan to Trump, the United States experienced a seismic reordering: an unraveling of the postwar consensus, a collapse of faith in institutions, and a steady retreat from the idea that democracy can deliver a decent life for most people. The promise that globalization and technology would lift all boats has proven hollow for much of the population. What emerged in its place was a new coalition of grievance and power—one that has increasingly upended America's role in the world and its understanding of itself.

The Long Drift: Debt, Displacement, and the Crisis of Belief

The American economic consensus, forged in the crucible of postwar prosperity, began to fracture in the 1980s with Ronald Reagan’s embrace of neoliberalism: lower taxes, deregulation, free trade, and a shrinking welfare state. Over the next four decades, both major parties would accept this framework—even as it undermined the very coalitions that sustained them.

Poor choices across multiple administrations compounded the damage:

• Globalization dismantled the industrial base in pursuit of efficiency, leaving millions behind and hollowing out the working class.

• The Iraq War, built on hubris and false premises, drained trillions of dollars while destabilizing a region and squandering U.S. credibility.

• The 2008 financial crisis, a direct consequence of bipartisan deregulation and financialization, wiped out household wealth and led to mass unemployment, followed by a lopsided recovery that favored the already-rich.

• COVID-19 triggered trillions in emergency spending—but also revealed something deeper: that America had outsourced its industrial capacity to the point of near-total vulnerability.

Suddenly, Americans discovered they couldn't produce masks, ventilators, or basic pharmaceuticals without foreign supply chains—many anchored in authoritarian regimes. Years of “efficiency” had eroded resilience. The pandemic exposed what economists like Oren Cass and nationalists like Steve Bannon had long argued: that the pursuit of cheap labor and just-in-time logistics had made the U.S. economically brittle and strategically dependent.

Each of these failures expanded the federal debt. From 1980 to 2024, the national debt grew from under $1 trillion to over $34 trillion. These were not just accounting issues; they reflected a deeper failure of strategic judgment. America repeatedly chose short-term fixes and elite-consensus policies that served markets—but not citizens.

By the time Trump arrived, the debt had become a symbol of this betrayal.

The Trump Doctrine: Re-Shoring as Populism and Defense

Trump’s campaign and presidency marked a rupture—not just in tone, but in geopolitical orientation. “We can no longer afford to be the world’s policeman,” he warned. The debt, he claimed, was proof that America could no longer supply global public goods—security guarantees, trade liberalization, and development aid—that had defined the post-WWII order.

Instead, Trump offered a new doctrine: protectionism, tariffs, and industrial policy. He pulled out of multilateral agreements, imposed tariffs on allies and rivals alike, and refashioned America’s role as a transactional hegemon. He abandoned the Republican commitment to free markets and embraced economic nationalism.

At the core of this shift was a belief that America had abandoned the very people it needed most. With an estimated 54% of the U.S. population reading at or below a sixth-grade level, millions of citizens had been left out of the high-skill, globally integrated knowledge economy. The logic of neoliberalism had no use for them. Trump—and his ideological allies like Cass and Bannon—saw re-shoring manufacturing not only as an economic policy, but as a social and national defense imperative.

Rebuilding domestic production would, in theory, provide stable, semi-skilled jobs for displaced workers, revitalize decaying communities, and reduce the nation’s dependence on foreign suppliers in key industries like pharmaceuticals, semiconductors, and steel. It was, in essence, a new version of the old New Deal bargain—but recast in nationalist, not universalist, terms.

Is Life Actually Worse? A Sober Assessment

Amid rising national anxiety, populist rage, and cultural fragmentation, a basic question must be asked:

Is life in America actually worse than it used to be?

The answer is not as simple—or as bleak—as it often feels.

By many conventional measures, American life has improved in the decades since the 1970s and 1980s:

• Life expectancy, despite recent setbacks from COVID-19 and the opioid crisis, is still higher than in the postwar period.

• Absolute poverty rates have declined significantly, particularly among children, thanks to tax credits, food assistance, and Social Security.

• Access to higher education has expanded dramatically—though costs and debt have soared alongside it.

• Technology has delivered immense convenience, connectivity, and medical breakthroughs.

• Consumer goods are cheaper, more abundant, and more advanced than ever before.

The U.S. economy remains the largest and most dynamic in the world, still a magnet for capital and innovation. American workers are, in the aggregate, more productive than their predecessors, and the U.S. dollar retains its central role in global finance.

Yet beneath these gains lies a deeper fracture—not of wealth, but of distribution, meaning, and security:

• Wages for non-college workers have barely budged in real terms since the late 1970s, while the top 1% has captured the lion’s share of income growth.

• Wealth inequality is at its highest level in a century, with the richest 10% owning over 70% of all assets.

• Housing, healthcare, and education costs have vastly outpaced wage growth, putting core elements of the American Dream out of reach for many.

• Union power and job stability have eroded, replaced by gig work, contract labor, and precarity.

• Social mobility has declined. A child born in 1940 had a 90% chance of earning more than their parents; for a child born in 1980, that chance is closer to 50%.

• Deaths of despair—suicide, alcohol abuse, and opioid overdoses—have surged, especially in working-class white communities.

So, while life is not universally worse, it is increasingly unequal, insecure, and fragmented. It’s not that America is a failed society—it’s that it is two societies, diverging along lines of class, geography, and education.

And this divergence is not just economic. It has become cultural, emotional, and existential. People sense that their institutions are no longer responsive, that their work is no longer dignified, that their futures are no longer assured. The rage we see is not always about material deprivation; often, it’s about moral abandonment.

The contradiction at the heart of contemporary America is this:

We are richer than ever—but feel poorer than ever.

We are more connected than ever—but feel more alone.

We are more powerful globally—but less able to govern ourselves at home.

In this dissonance, demagogues thrive. And unless we reconcile this paradox—not only with new policies but with a new civic ethic—the American experiment will continue to fracture under the weight of its own contradictions.

Culture Wars as Substitute for Class War

Amid these shifts, economic class fell away as a dominant political category. Culture filled the vacuum.

With wages stagnant and upward mobility eroding, Americans increasingly defined themselves by identity, not income—race, religion, education, geography. The culture wars became the terrain on which broader anxieties played out.

Trump turned every cultural flashpoint—immigration, transgender rights, critical race theory, even professional sports—into a battlefield. For millions, he offered something neoliberalism never could: a moral narrative of restoration, even revenge. He didn’t promise new jobs so much as he promised recognition, a reversal of shame.

And in a cruel twist, this cultural combat also served the economic elite. While Americans argued over school curriculums and mask mandates, the richest 10% amassed over 70% of all new wealth during the pandemic. Culture wars became a substitute for class war, redirecting anger away from oligarchy and toward one another.

The Evolutionary Logic of Capitalism—and Its Moral Reckoning

Beneath the policy failures, economic shocks, and technological disruptions lies an even more profound structural truth—one rarely admitted in polite discourse: capitalism, in its purest form, is not a system of fairness. It is a system of selection.

At its core, capitalism is evolutionary—driven by competition, efficiency, and the survival of the fittest. In its finest moments, this dynamic has fueled innovation, expanded wealth, and improved standards of living. However, left to its own devices, it also has a Darwinian underside: there will always be losers, and increasingly, those losses are not marginal—they are existential.

With each new wave of consolidation and innovation- from railroads to Big Tech- capitalism has revealed its natural tendency toward monopoly or oligopoly, especially when economies of scale reward those who dominate early and then close the door behind them. Today, a handful of companies—Amazon, Google, Meta, and Microsoft—control the infrastructure of communication, commerce, and even cognition. The market does not reward the many, but the few.

Therefore, the central question is not whether capitalism produces winners and losers—because it does—but rather:

How many losers can a society tolerate before it collapses from within? And who bears the responsibility for them? Historically, the answers fell along three lines:

• Markets, it was assumed, would self-correct—creating new jobs as old ones disappeared. But that assumption, especially in the age of automation, now appears dangerously naïve.

• Government could intervene—through taxes, transfers, regulation, and investment—to soften the blows of creative destruction and ensure a degree of social cohesion.

• Charity and civil society would pick up the slack, providing moral and material support where institutions fell short.

Yet in modern America, all three pillars are failing. The market has become more extractive. Government is paralyzed by polarization and influenced by capital. And charity, however noble, is structurally inadequate to address widespread precarity—it serves as a Band-Aid on a systemic hemorrhage.

As more people are pushed outside the bounds of economic inclusion, they do not vanish. They grow angry, desperate, and become fertile ground for demagogues, who offer simple narratives with clear villains: immigrants, minorities, elites, globalists, and the “woke.” The scapegoating we now witness is not a product of irrationality—it is the political voice of disenfranchisement, channeled through resentment and rage.

In this light, the culture wars are not separate from economics; they are its emotional residue. They occur when a society abandons large portions of its population to structural failure and then tells them it’s their fault.

Without a moral reckoning regarding the limits of capitalism—and a political vision that includes rather than excludes—this cycle of exclusion and vengeance will not break; it will only deepen.

AI and the Fragility of the Democratic Order

Now, a new storm is gathering. The rapid rise of artificial intelligence threatens to deepen inequality, destabilize labor markets, and undermine public trust in truth itself.

Unlike previous waves of automation, AI targets routine tasks and cognitive labor: journalism, legal research, design, and diagnostics. Millions of white-collar workers—once thought immune to disruption—may soon face displacement. And unlike previous economic shifts, this one arrives after decades of failed adaptation.

America is poorly equipped for this transition. With a shredded safety net, weak labor protections, and polarized governance, the risk is economic pain and democratic decay. As more people lose their place in the economy, they may also lose faith in democratic institutions that seem incapable of managing the future.

Worse still, AI undermines epistemological authority. With deepfakes, algorithmic echo chambers, and synthetic media, the very notion of shared reality is eroding. Democracy depends on facts, compromise, and trust. AI corrodes all three.

If left unchecked, these forces may push the United States toward a techno-authoritarian future in which political legitimacy is maintained through surveillance, algorithmic control, and perpetual crisis management.

The Emerging Paradox: Free Riders, AI, and the End of Work

A bitter paradox simmers beneath the surface of American political life—one that may soon escalate into a crisis. The Republican Party, now centered around populist-nationalist rhetoric, has become fixated on the idea of “free riders.” On the global stage, it condemns NATO allies, China, and trade partners as beneficiaries of U.S. military power and market access, contributing little in return. Domestically, it portrays undocumented immigrants, welfare recipients, and the urban poor as ungrateful dependents—draining resources from the productive, tax-paying citizen.

But what happens when free-riding becomes systemic, involuntary, and inevitable—not through moral failing or foreign policy, but through technological progress itself?

The rise of AI and automation, guided by the logic of capital, is poised to decimate employment across various sectors, not only among factory and retail workers but also within the white-collar class. As productivity increases and the labor share of income diminishes, an expanding population segment may become structurally unemployable- not due to a lack of willingness but simply because the economy has no place for them.

Thinkers like Andrew Yang have already proposed a Universal Basic Income (UBI) to address this looming problem, a modern-day equivalent to the welfare state—but without the stigma. Bill Gates, somewhat surprisingly, suggested a “robot tax”—a levy on machines that replace human labor- to be redistributed as public revenue. These ideas remain outside the mainstream, but their relevance is only increasing.

What’s glaring is the absence of any coherent conservative or capitalist plan for what happens next. How do you sustain a market-based democracy when millions are excluded from production and consumption? How do you preach the virtues of work when work itself is evaporating?

Here lies a profound, unresolved contradiction: a political movement obsessed with moralizing work and punishing dependency is hurtling toward a future where dependency may become ubiquitous and work optional—not by choice, but by design. Furthermore, the complaint about “elites" is exacerbated in this future market dominated by technological oligarchs holding monopolies over many services requiring minimal labor. Additionally, the chance to become an elite demands ample intelligence, particularly in mathematical intelligence, which most people lack.

If the Republican obsession with “free riders” is not tempered by a willingness to rethink the distribution of wealth and power, it may soon become politically untenable or, worse, morally catastrophic. The unwillingness to reconsider the taxation of corporations and the wealthy and to promote a fair and dignified method of redistribution represents a blind spot in their agenda. If Democrats also fail to present a bold vision of inclusive prosperity in the AI age—beyond vague commitments to retraining or STEM education—they too will have abandoned the very people on whom democracy depends.

How will society treat and engage the bottom 50% in work and citizenship? We are at a moment when they could be left behind and viewed as nothing more than a cost. Technology is reshaping the value of human labor and, consequently, the value and viability of certain types of humans within a capitalist system. Recall that Trump said, “I love the poorly educated.” Can he create a new economic structure that sustains US competitiveness and living standards while employing the least among us, all amidst the rise of massive automation?

In this sense, Karl Marx’s prophecy of a proletariat alienated from the means of production may return not as revolutionary ideology but as empirical reality—only this time without factories, no organizing principle, and no movement to speak its pain.

Conclusion: After the End of History

The promise of the post–Cold War order—that markets would bring peace, technology would bring equality, and democracy would triumph—now lies in ruins. The rise of Trump, the shift toward protectionism, the inability to reform amid repeated crises, and the looming threat of AI automation all indicate a reckoning not only with policy but also with purpose.

What replaces the old consensus remains uncertain. Republicans are fashioning a new industrial-populist identity. Democrats—having lost the working class—remain adrift, struggling to align their progressive moral language with an economic platform that might win back those left behind.

But one thing is clear: unless economic power is rebalanced, democratic institutions revitalized, and technological disruption governed with foresight and equity, the United States will continue to drift toward division and dysfunction—not because democracy was defeated, but because it was abandoned.

History has returned. And it asks whether America can still govern itself.

Bibliography

Books and Scholarly Works

1. Francis Fukuyama. The End of History and the Last Man. Free Press, 1992.

2. Thomas Piketty. Capital in the Twenty-First Century. Harvard University Press, 2014.

3. David Autor, David Dorn, and Gordon Hanson. “The China Syndrome: Local Labor Market Effects of Import Competition in the United States.” American Economic Review, 2013.

4. Karl Marx. Capital: A Critique of Political Economy, Volume I. Penguin Classics, 1990 [original 1867].

5. Oren Cass. The Once and Future Worker: A Vision for the Renewal of Work in America. Encounter Books, 2018.

6. Samuel P. Huntington. The Clash of Civilizations and the Remaking of World Order. Simon & Schuster, 1996.

Reports and Policy Analyses

7. Congressional Budget Office. The Budget and Economic Outlook: Fiscal Years 2022 to 2032. February 2022.

8. Bureau of Labor Statistics. Union Membership Summary. 2023.

9. Economic Policy Institute. “CEO pay has skyrocketed 1,322% since 1978.” 2023.

10. Brookings Institution. “Automation and Artificial Intelligence: How Machines Are Affecting People and Places.” January 2019.

11. World Inequality Database. https://wid.world

12. Pew Research Center. “Public Trust in Government: 1958–2023.”

13. Institute for the Future of Work. “The AI Disruption Index.” 2023.

News and Commentary

14. Matthew Rose. “The Real Meaning of ‘The End of History’.” The Atlantic, July 2020.

15. George Packer. “How America Fractured Into Four Parts.” The Atlantic, July/August 2021.

16. Ezra Klein. “Andrew Yang’s Big Idea.” The New York Times, March 2020.

17. Kevin Roose. “Bill Gates Says We Should Tax Robots. Elon Musk Agrees. Do You?” The New York Times, February 2017.

18. Zachary Karabell. “America’s Supply Chain Wake-Up Call.” Foreign Affairs, May 2021.

19. Fareed Zakaria. “The Self-Destruction of American Democracy.” The Washington Post, January 2021.

Government and Official Sources

20. U.S. Treasury Department. Historical Debt Outstanding.

21. Federal Reserve Board. Survey of Consumer Finances, 2019 and 2022 editions.

22. White House. American Rescue Plan Fact Sheet. 2021.

23. Congressional Research Service. National Debt and Fiscal Policy. 2023.