Billionaire investor and Bridgewater Associates founder Ray Dalio has sounded a stark warning about the growing economic fragility of the United States, arguing that the country has developed a dangerous economic “dependency” on its top 1% of workers while the bottom 60% are falling behind—struggling with stagnating productivity, weak education, and declining financial stability.
Speaking at the Fortune Global Forum in Riyadh, Dalio emphasized that the U.S. can no longer be analyzed as a single economic entity. Instead, it has split into two economic realities—one thriving and one in decline.
“You can’t look at the U.S. as a whole nowadays,” Dalio said. “We have two economies: the top 40%, especially the top 1%, who are doing extremely well—and the bottom 60% who are economically unproductive, financially stressed, and socially disconnected.”
A Divided Workforce: Prosperity vs. Fragility
Dalio’s assessment reflects a deeper shift in America’s labor market. In recent decades, economic growth has been increasingly concentrated among high earners—particularly those working in technology, finance, and professional services. Meanwhile, the majority of Americans have seen wages stagnate, education quality fall, and job security deteriorate.
Two Economic Realities in the U.S.
| Group | Share of Population | Economic Status | Contribution to Growth |
|---|---|---|---|
| Top 1% | 1% | Wealth and salary surge | Drives innovation and investment |
| Top 40% | 39% | Stable or growing wealth | Beneficiaries of capital markets |
| Bottom 60% | 60% | Income stagnation, debt, low productivity | Increasingly dependent on government aid |
Dalio argues that America now relies disproportionately on the output and tax contributions of the top earners, which has made the system financially and politically unstable.
Warning Signs: Declining Productivity and Rising Debt
Dalio pointed to weak productivity growth in lower-income regions as a key concern. He noted that regions representing the bottom 60% show productivity levels nearly unchanged from the 1980s, while the top performing regions have surged ahead with advanced technology and high-skilled labor.
Other warning signs include:
- Household debt is rising faster than income among the bottom 60%
- Education levels have deteriorated compared to other developed nations
- Life expectancy is declining in many low-income U.S. counties
- Mental health and social division are both worsening
Dalio called this trend “a structural economic time bomb.”
“If productivity doesn’t improve across the population, the system breaks. You can’t support a nation where most of the population doesn’t participate in productivity growth,” he said.
A Crisis of Opportunity
Dalio also highlighted that economic mobility—once central to the American Dream—is fading. Children from the bottom 20% income bracket have just a 7% chance of reaching the top 20%, according to Harvard research, compared to 16% in the 1940s.
The key drivers, according to Dalio:
- Failing public education systems
- Limited access to capital and entrepreneurship
- Weak infrastructure investment
- A widening digital and skills divide
Social and Political Risks Ahead
Beyond economics, Dalio warned of escalating societal and political risk in the United States. Economic inequality has fueled polarization, resentment, and distrust in institutions.
“Internal conflict is now one of the biggest threats to America,” Dalio said. “No great empire falls from external powers first—it collapses from within.”
Dalio has long cautioned that the U.S. is entering a “classic late-stage empire cycle,” characterized by high debt, widening wealth gaps, populism, and declining global influence.
What America Must Do—Dalio’s Proposed Fix
Dalio argued that the U.S. must urgently invest in productivity and opportunity for the majority of citizens—not just the elite. His recommendations include:
✅ Education reform and vocational training
✅ Rebuilding U.S. infrastructure
✅ Public–private partnerships to boost small business
✅ Fiscal discipline to prevent debt crises
✅ Reducing political extremism and social division
Conclusion: A Turning Point for the U.S. Economy
Dalio’s message from Riyadh is clear: America’s future depends on rebuilding its economic foundation—from the bottom up. Without intervention, dependency on the top 1% of workers and wealth creators may push the country into deeper instability.
“The U.S. still has tremendous resources and innovation,” Dalio concluded. “But unless the bottom 60% becomes more productive, the system is unsustainable. This has reached a point where we can no longer ignore it.”
