John Williams runs a site called Shadow Government Statistics, based on the premise that the Federal government has been lying to you since the mid 1990's about some crucial statistics. His most critical calculation is on unemployment. I have regularly been using the U-6 measure that counts discouraged workers and part-time employees who wish to work full-time. But Williams says, even that undercounts the unemployed.

"Up through 1994, this was the definition of discouraged workers: You met all the other qualifications, but you haven't looked for work in the last four weeks," Williams said. "In '94, they changed the definition so that in order to be discouraged, you had to have not looked for work in the last four weeks, but you had to have worked in the last year. The result knocked several million people out of consideration. ... Those who hadn't looked for work in the last year just weren't counted." The result, he said, is an army of unemployed workers that the government simply redefined out of existence.

But then you read in the same issue of the Times this quote.

All seems well indeed atop the food chain. Whole Foods, purveyor of richly priced organic onions and other groceries, last week raised its best estimate for same-store sales growth this year to as much as 7 percent from as little as half that. Its shares have gained 45 percent this year, while those of price-conscious Wal-Mart are down a bit.

Other anecdotes tell a similar story. The chief executive of one of America's biggest banks contends that the strength of the American economy will surprise everyone. The hedge fund manager John A. Paulson has been busy telling investors he is seeing the upward side of a V-shaped recovery. His investments in banks and other economy-driven stocks back up the view.

So first you have to look at who's got the money.

We should start with the top 5% of American households that control 72% of America's wealth. I call them The Insiders. At the very top of the insiders, Business Week recently noted that the average income reported by the 400 highest-earning U.S. households grew to almost $345 million in 2007, while they paid an average tax rate of 16%? Much of this wealth come from the world of finance as opposed to industrial production as is evident by this chart.

I will not try to address the question of whether the very remunerative activities of these speculators is a net benefit to our society, but it does seem quite obvious that The Insiders privilege is like a festering boil in the class conflict that is at the root of the Tea Party Movement. But this "class consciousness" is necessarily obscured by the fact that the proprietors of the main source of media information for the Tea Party (Rush Limbaugh, Glenn Beck and Rupert Murdoch) are all members of of the Insider Club of the top 5%. They have no interest in turning the Tea Party rage on their own privilege. They are Private Jet Populists.

The second group in the Four Americas is the next 15% of our society that owns 21% of the wealth--The Middle Class. Most of them still have their jobs and though the ranks of the middle class may shrink, they don't feel embattled and so they have a certain optimism about the recovery that is crucial. But this group is probably split politically by age, with the older demographic being much more conservative on social issues like gay marriage or support for military spending. In general many of the middle class are professionals (doctors, lawyers, teachers) and so they have a generally liberal outlook and are probably among Obama's strongest supporters. But they are realistic. They know that on a day like the Flash Crash, The Insiders with their dark pools of capital and their high frequency trading platforms get to the front of the line in the trading queue. They know the fix is in.

The third group in our cohort is the Working Class--the 65% of the country that has very little financial wealth and as the CEO of WalMart said yesterday, "more than ever our customers are living paycheck to paycheck." These people are pissed off, but because they are fed so much propaganda by Fox News, they are pissed off at the wrong people. Their anger should be directed at The Insiders, but they have no way to express their outrage at the leaders of Citibank or Goldman Sachs. What are they going to do? Cut up their credit cards? Put their money in a mattress? So their anger gets channeled towards the Middle Class (liberal professors are one of Glenn Beck's favorite strawmen) and towards the politicians that have taken the money and the cues from The Insiders.

The final group is The Outsiders--the 15% permanent unemployed underclass that has now risen to 20%. Many of them have mental or physical disabilities but as a society we don't know what to do with them. They are totally removed from politics--they don't vote and they don't protest--and so we ignore them. We see them walking the streets of our big cities at night, pushing their earthly belongings in their pilfered shopping carts, talking to the moon. In a just society, many of them would be hospitalized, but long ago we emptied out the mental wards and decided it was a law enforcement and not a mental health problem.

There are two ways to think about the Four Americas. One is to believe that the country will continue to prosper as the rich continue to spend. A Citibank analyst report was fairly succinct in this regard.

Back in October,we coined the term 'Plutonomy'. Our thesis is that the rich are the dominant drivers of demand in many economies around the world (the US,UK, Canada and Australia). These economies have seen the rich take an increasing share of income and wealth over the last 20 years, to the extent that the rich now dominate income, wealth and spending in these countries. Asset booms,a rising profit share and favorable treatment by market-friendly governments have allowed the rich to prosper and become a greater share of the economy in the plutonomy countries.

The social controls (of advanced industrial society) exact the overwhelming need for the production and consumption of waste; the need for stupefying work where it is no longer a real necessity; the need for modes of relaxation which soothe and prolong the stupefication; the need for maintaining such deceptive liberties as free competition at administered prices, a free press which censors itself, free choice between brands and gadgets.

I have no idea how to create a class consciousness in this country, but any democracy in which 5% of the people call all the shots, cannot represent itself as "the last best hope of mankind."