Excess Returns Podcast — Episode Summary

Episode Title: The Precarity Line | Ben Hunt and Adam Butler on the Broken Math of the American Dream
Guests: Adam Butler (Resolve Asset Management, author of “The Bureau of Missing Children”), Ben Hunt (Epsilon Theory)
Host: Matt Zeigler
Date: December 19, 2025

Overview

This special crossover episode features a deep and candid discussion about America’s eroding middle-class stability and the “precarity line”—a concept the guests argue is more relevant than the traditional poverty line. Drawing inspiration from viral essays by Mike Green and Adam Butler, and hosted amid a widespread online debate, the episode addresses the growing disconnect between standard economic indicators and the lived reality of modern American families. The conversation covers why metrics like “poverty” have become less meaningful, how debt and structural costs have pushed middle-class security out of reach, the consequences of relying on credit, and the political and policy failures underlying these shifts.

Key Discussion Points and Insights

1. From Poverty to Precarity

(Starts ~01:00, Deep Dive at 04:00)

• Adam Butler: Motivated by personal concerns for his own children, Butler explains he wrote “The Bureau of Missing Children” to highlight the real dangers of “precarity”—living on the edge, rather than traditional poverty metrics.

  • Quote: “It’s not poverty per se. It’s precariousness. Precarity. It’s debt is that source of precarity. And when...that credit starts to be withdrawn...then that’s when the precarity starts to bite.” (Ben Hunt, 01:21)

• Host’s Framing: The conversation is a response to Mike Green’s critique of the poverty line, and Butler’s work broadens the scope to “participation in modern economic life” as the relevant measure.

2. Measurement, Vibes, and Human Flourishing

(02:00—13:20)

• Disconnect Between Data and Reality: Standard metrics, such as inflation and poverty rates, do not capture people’s actual experience.

  • Adam Butler: “What this concept...reflects is a clear and growing disconnect between the metrics that we use to measure human flourishing and the reality on the ground.” (01:48, 11:51, reiterates at 12:11)

• Technocratic Gaslighting: Both guests discuss the frustration of technocrats and economists dismissing widespread feelings of economic insecurity as mere “vibes,” which is harmful and politically destabilizing.

  • Quote: “If you felt precarious in your life, you know, it ain’t just some freaking vibe. It means you’re on the edge of your whole life going in a really bad way.” (Ben Hunt, 10:54)

3. Defining the Participation Budget & Broken Math

(22:17—26:47)

• Participation Budget Exercise: Butler describes constructing a “participation budget” that captures what it actually costs to form a family and participate fully in the economy (housing, childcare, health, transportation, student debt), and uses Monte Carlo simulations to see where real families stand relative to that threshold.

  • Result: Approx. 60% of households are below the minimum needed to cover basic expenses required for full economic participation—much worse than traditional poverty metrics indicate.

  • Quote: “You need $151,000 pre-tax income to service all of those...that household budget.” (Adam Butler, 26:13)

4. Debt, Industry Rationalization, and Modern Precarity

(27:50 – 40:11)

• Ben Hunt observes that modern life has seen ordinary family activities (children’s sports, pet care, schooling) “rationalized” into expensive, extractive industries. These rising costs and the necessity to use debt to keep up create systemic precarity.

  • Quote: “So many aspects of our economy are driven by efficiencies of capital to extract more and more from the elements of the experience that we want to associate with having children.” (Ben Hunt, 28:19)

• Relates to Robert Frank’s concept of “Darwin’s wedge” and positional goods (33:10), where individual competition for scarce, desirable goods (e.g. good school districts) pushes up prices for everyone and leaves most worse off.

5. Credit, Off-Balance Sheet Subsidies & the Role of Grandparents

(39:13—45:08)

• Obscured Reliance on Credit and Family: The facade of middle-class stability is increasingly supported by off-balance sheet subsidies—grandparents providing unpaid childcare, families going further into multigenerational debt, etc.

  • Quote: “Because we don’t measure [this help], it doesn’t show up in any of the statistics...it does play a very specific role economically.” (Adam Butler, 40:38)

• Ben Hunt connects this to human “eusociality,” emphasizing intergenerational care as foundational for our species but largely ignored by economic measurement (42:24).

6. Historical Perspective and Structural, Policy Shifts

(46:09—57:26)

• Changing Reasons for Family Formation: The rationale for having children has changed dramatically (once subsistence or “old-age insurance;” now more about self-actualization and participation in society).

  • Demographic Transition (Ben Hunt, 48:00)

• Compression of Choices: Labor mobility—a former engine of growth and family security—has been stifled by high housing costs, student debt, and geographic sorting. Today’s families face a much narrower “escape route” from precarity than prior generations.

  • Quote: “The limitation of opportunity...to make, choices to make it work, have just compressed so enormously.” (Ben Hunt, 55:58)

7. Policy: What’s Broken, and What Might Work

(58:20—72:39)

• Decline of Public Mission and Imagination: Guests lament the collapse of American ambition for major, public works—“the moonshot mentality.” Butler argues neoliberal deference to markets alone no longer works; top-down or mission-based strategies, “Operation Warp Speed”-style, are needed for major challenges.

• Debate: Visionary Leadership vs. Decentralization

  • Hunt worries about the dangers of putting too much faith in visionary leaders, fearing “moonshots” led by demagogues or oligarchs like Elon Musk or Trump. He advocates for decentralized, bottom-up community-building and policy nudges to empower the middle class rather than create new billionaires.
    • Quote: “I want a thousand millionaires more than I want one billionaire.” (Ben Hunt, 68:18)
  • Butler counters that Silicon Valley, left to its own devices, has partially proven the limitations of pure market experiments: “What’s come out...has mostly been exploitative technologies that earn extraordinary outsized profits from immiserating an increasingly sizable portion of the population.” (68:55)

8. What’s Next? Civic Bonds, Carrying the Fire, and Cynicism vs. Action

(72:40—79:10)

• Search for a ‘Third Attractor’: Both guests, wary of market fundamentalism and authoritarian leadership, seek a middle ground that restores community trust, shared identity, and civic obligations.

• Cynicism, Resignation, and Quiet Hope:

  • Adam Butler: Many, especially professional peers, “throw up their hands” in response to these challenges—retreating to private spheres rather than risking public stands. Nonetheless, he feels compelled to keep sparking the conversation: “I am frothing energetically with the desire to have these conversations.”
  • Ben Hunt: Cites Cormac McCarthy’s “carrying the fire” as a personal duty: “We just got to keep the fire alive. And we can do that, Adam. We can do that. Yep, we really can.” (79:10)

Notable Quotes & Moments (with Timestamps)

• “If you felt precarious in your life, you know, it ain’t just some freaking vibe. It means you’re on the edge of your whole life going in a really bad way.”
  — Ben Hunt (10:54)
• “We’ve lost this imagination...we need a visionary leader to say, ‘No, we’re going to cure cancer in the next 15 years’...and then unleash the private sector in pursuit of that objective, with the government guaranteeing some proportion of the purchase of whatever comes out.”
  — Adam Butler (62:26)
• “I want a thousand millionaires more than I want one billionaire.”
  — Ben Hunt (68:18)
• “I think the strong leader is not really…maybe a model where we’re using technology to pull and engage citizens about what their long-term goals and priorities are…then using the federal balance sheet to empower it in a way.”
  — Adam Butler (70:16)
• “We just got to keep the fire alive. And we can do that, Adam. We can do that. Yep, we really can.”
  — Ben Hunt (79:10)

Structural Flow of the Episode (with Timestamps)

• Opening and Context (01:00—03:34)
• Emotional and Intellectual Motivation for Reframing Poverty (Butler’s Angle) (04:00—07:34)
• Reaction to Technocratic Criticism and the Poverty Line Debate (07:39—13:20)
• Detailed Breakdown of Precarity, Participation Budget, and Changing Costs (22:17—26:47)
• Industries and Rising Costs (sports, housing, schooling) and Darwin’s Wedge (27:50—36:39)
• Debt, Family Support, and Economic Measurement Blindspots (39:13—45:08)
• Historical Comparison: 100, 40, 25 Years Ago (46:09—57:26)
• Policy, Systemic Discussion and Disagreements (58:20—72:39)
• Finding hope, carrying the fire, why this conversation matters (72:40—79:13)
• Endnotes, Social Handles and Calls to Action (80:28—End)

Final Thoughts

This episode is an urgent, nuanced exploration of the “broken math” beneath the American dream. Rather than focusing just on abstract statistics, Ben Hunt and Adam Butler forcefully argue for acknowledging precarity and rebuilding the social, political, and community bonds that sustain genuine human flourishing—while being honest about the challenges, political obstacles, and difficult trade-offs ahead.

Connect with the Guests:

• Adam Butler: @Gestaltu on Twitter, The Choice Engine (Substack), investresolve.com
• Ben Hunt: @EpsilonTheory on Twitter, EpsilonTheory.com

For further discussion or feedback, visit excessreturnspod.com.

“Carry the fire.”