The co–chief investment officer and chairman of Bridgewater Associates warned in a LinkedIn post on Thursday that large deficits, high taxes, and high inflation combined with widespread wealth inequality and unprecedented Washington partisanship will lead to civil war, “though these fights can be more or less violent,” he said. 

When foreign powers like China and Russia challenge a country dealing with high levels of disagreement, “it is an especially risky period,” wrote Dalio. “I believe we are in this period now.” 

An increase in populism and extremism, plus fights between the left and right, are classic indicators of future warlike conflict, he said. Political extremists see respecting the law as secondary to winning, and internal conflicts become self-reinforcing, added Dalio, alluding to Jan. 6, 2021, when supporters of President Donald Trump stormed the U.S. Capitol in an attempt to overturn the outcome of the presidential election, resulting in the deaths of five people and numerous injuries. 

Dalio, who is promoting his new book about economic histories and the rise and fall of nations, also laid out what he described as six stages of internal disorder and order. It begins with the creation of a new government followed by periods of peace and prosperity. Eventually, excess spending and the accumulation of wealth and power weigh on the system, leading to “bad financial conditions and intense conflict,” the stage we’re in now, according to Dalio. The next step, he says, is civil war and revolution, which leads back to step one. 

“History shows that raising taxes and cutting spending when there are large wealth gaps and bad economic conditions, more than anything else, has been a leading indicator of civil wars or revolutions of some type,” he said. 

Dalio has long voiced concern about issues such as income equality and has called for higher tax rates for the wealthy. In the past, he’s made campaign contributions to late Republican Sen. John McCain, but he has made no contributions in recent years.

In the 2022 midterm elections, Dalio predicts moderates will lose seats while extremists and populists in both parties will gain them. He also predicts that Supreme Court rulings will become more contentious, leading to big tests of power. By the 2024 presidential election, he said, there will be a “battle between the populists of the right and the populists of the left in which neither side will accept losing.”

“Such a sequence of events will be consistent with the typical path that leads to civil war,” he said.

And while Dalio says this civil war could look very different from previous ones, it’s not unfathomable that people will die, just as they did on Jan. 6. 

“The most obvious clear marker of going into a bad civil war is people dying,” he wrote. “History shows that when people start dying in conflicts—even just a few of them—that one expects much worse because then emotions and the need for retributions fuel more fighting.”